Electricity (Privatisation)

Part of the debate – in the House of Commons at 7:07 pm on 7 March 1988.

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Photo of Mr Trevor Skeet Mr Trevor Skeet , Bedfordshire North 7:07, 7 March 1988

I see the hon. Gentleman springing up, but I shall not give way.

The leasing of selected coal mines to named generators might also be considered, although the ownership of facilities would remain with British Coal. In determining prices for the consumer, more is likely to be gained by the industry and the public through a rational import policy on coal at international rates and the retention of comparable rates of fuel oil tax than through competition.

Finally, I refer to nuclear electricity. I have a feeling that the arrangements could lead to a scaling down of nuclear power projects in England, although not in Scotland. The historical approach has not been of advantage. Over the past eight years, there have been very few orders. The chief executive of the British Oxygen Company said: We see a real danger that fragmentation will mark the demise of Britain's nuclear programme. We believe this programme is essential for strategic diversity of fuel sources and will for all plausible levels of fossil fuel prices over the life of the plant prove to be commercially correct. The CEGB has about 3,460 MW of Magnox power, most of which is to be retired by the end of the 1990s. The advanced gas-cooled reactor programme is 4,720 MW. That is considerable, but, in turn, it will have to be retired later. Unless we have new buildings and the engineering facilities of the CEGB are maintained at the scale that has been achieved, it will be extremely difficult for a nuclear programme to continue in the United Kingdom.

The nuclear research and development programme is already in jeopardy. I noticed in The Independent of 3 March a report saying that the research programme for decommissioning has been abandoned. I have also noticed that the CEGB has abruptly withdrawn from building an £18 million new laboratory for microscopic examination of material bombarded by radiation. Why could these programmes not have been continued? Would this proposal have been an incentive for the CEGB to go ahead with its projects, or would it regard itself, because it is to be cut in size, as not having the same incentive to go ahead with its obligations, bearing in mind that its statutory commitment to supply has been taken away?

The paragraph 49 statutory obligation imposed on distribution companies is avoidable. They will have to take nuclear power, but they can take it from Scotland, where there is a heavy preponderance of nuclear power, or from France. They could get together and have a second cable from the continent to draw this power, or they could take it by other means.

The hon. Member for Truro mentioned compensation for nuclear acidents. We have learnt, through questions today, that this is covered by a convention, of which the total liability is £20 million. Then it is over to the taxpayer if any further sums have to be paid. I remind my right hon. Friend the Secretary of State of Chernobyl. The compensation for that great state calamity in 1986 has worked out at £7·56 billion, and that is beyond the capacity of either a large company or a minor country to bear. There is no cash fund to make provision for decommissioning, so there will be a charge on Her Majesty's Government.

With those reservations, I support what has been proposed. It is important that I should make those reservations, while I intend to support the Government, hoping that they will bear in mind the points that I and others have made, and will decide to make modifications. I know that they cannot chop and change too much at this stage, but it is important to keep the grid as one unit, and keep it independent or divided between the CEGB and the distribution organisations. It should be either completely independent or they should all have a share in it. If that happened, it would be more satisfactory as a commercial operation than under the suggested arrangements.