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Nuclear Power

Part of the debate – in the House of Commons at 7:47 pm on 22nd October 2002.

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Photo of Vincent Cable Vincent Cable Shadow Spokesperson (Trade and Industry), Liberal Democrat Spokesperson (Trade and Industry) 7:47 pm, 22nd October 2002

I certainly shall. As the hon. Gentleman well knows, there are different ways of reducing carbon emissions, not least by placing far greater emphasis on energy efficiency, energy conservation and new renewables than the Government have placed on them so far.

I recognise that we must pose questions as well as make assertions. I acknowledge that the Government face difficult choices—for example, thousands of people working in one generator or another being at risk of losing their livelihood is clearly a serious matter. I recognise, too, that the Government have inherited some serious problems in energy policy, not least the privatised company British Energy.

It is important to delve into the past to some extent. The circumstances in which British Energy was privatised were scandalous: it was sold at a price that barely covered the construction costs of one of the eight reactors that were sold off. We saw such rip-offs in Russia in the early days of the post-communist era, but it happened here in this country with British Energy. The people who have subsequently run the company have displayed a mixture of stupidity and greed comparable to that seen in some of the other utilities. In 1999, when severe losses were already accumulating, the company decided to pay out #430 million in an extra dividend to its shareholders. Earlier this year, when the company had already recorded very large losses of more than #500 million, the chief executive was awarded a performance bonus. Those who ran British Energy went around the world making acquisitions—for example, in north America—but did not concentrate on the increasing competitive problems within their own industry. That is the company whose shareholders the Government now want to rescue.

There are other factors to be taken into account—for example, many of the reactors are old. The nuclear power industry has a long and complex history: it started in the 1950s, often inspired by genuine and admirable idealism—people wanted to convert the dangers of nuclear warfare into creating a form of cheap energy that would last indefinitely. Policy was taken forward in the 1960s by Harold Wilson, Tony Benn and others who believed that big science and state planning could drive the nuclear energy sector. Mrs. Thatcher was a great fan—perhaps inspired in part by the fact that it was a form of energy that did not pass through the hands of either Arabs or coal miners. Nuclear power had strong patronage from both sides for a long time, but then came an abundance of reports from the Organisation for Economic Co-Operation and Development and others, including the Brundtland report in the mid-1980s, which shows that not only did the nuclear power sector pose serious environmental problems—waste disposal and so on—but it was not economically competitive. It beggars belief that in introducing an energy market the Government did not anticipate the development that has taken place in the past few months.