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Green Energy (Definition and Promotion) Bill

– in the House of Commons at 9:33 am on 3rd July 2009.

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Consideration of Bill, as amended in the Public Bill Committee

Third Reading

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey 9:50 am, 3rd July 2009

I beg to move, That the Bill be now read the Third time.

It has been a privilege and a pleasure to help to pilot the Bill through the choppy waters of parliamentary procedure thus far. Private Members' Bills are notoriously fragile vessels and the waters are full of dangerous beasts, but I am happy to say that when I sought navigational assistance from the Government, they responded avidly. In fact, they seem to have taken over the ship, but I am not concerned about that. I am concerned about getting a Bill on to the statute book, with cross-party support, which will help to move the green agenda forward and help businesses, communities and individuals to play their part in meeting the challenging target of an 80 per cent. carbon reduction by 2050, and the perhaps even more challenging 2020 target that the Government have set us for renewable energy.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

The hon. Gentleman is now facing his third Minister on the same Bill. Before he leaves the subject of the history so far, may I ask whether he agrees with me that he enjoyed a good, co-operative relationship with the previous two Ministers—particularly my right hon. and learned Friend Mr. O'Brien, who decided that the Bill was valuable and should be supported, and the Minister of State, Department of Energy and Climate Change, my hon. Friend Joan Ruddock, whose co-operation in Committee ensured that all the amendments were carried unanimously?

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I was coming to exactly that point. There has been a good working relationship, demonstrating that when it comes to important matters relating to climate change and carbon reduction we need to work together, and proving that we can work together. I am very grateful to successive Ministers. I might wish that there had not been so many of them, but the hon. Gentleman is of course a beneficiary of the way the doors have revolved in Whitehall in recent weeks, and I am pleased about that as well.

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Photo of Andrew Dismore Andrew Dismore Labour, Hendon

I congratulate the hon. Gentleman on getting this far. One of his master strokes was asking me to be one of the Bill's supporters. I thought that the best way I could help was by taking a Trappist vow of silence on a Friday, but I want to compliment him on what he has been able to achieve. Energy efficiency and renewable and low-carbon sources have an important role to play in the long-term strategy, and I think that his Bill will make a major contribution towards the meeting of our share of the 2020 renewable energy targets. I hope that it will receive an unopposed Third Reading.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

That is rare praise for a private Member's Bill. It may have something to do with the fact that the hon. Gentleman's own private Member's Bill is due to be dealt with later today, but I am delighted by what he has said. I return to my metaphor involving ships, pilots and navigators. The hon. Gentleman is, of course, one of the most notorious Friday morning pirates in the House, and it is good to have him onside on this occasion.

Let me extend my gratitude beyond the ministerial team to the civil servants in both the Department for Energy and Climate Change and the Department for Communities and Local Government, who have worked together to help the Bill to make progress and, in some cases, to make sense. I am also grateful to those in the Public Bill Office who, as ever, have worked their secret ministry, and to my hon. Friends Gregory Barker and for Wealden (Charles Hendry), both of whom have spoken from the Opposition Front Bench during proceedings on the Bill.

Almost inevitably, given that this is a "green" private Member's Bill, I owe a particular debt of gratitude to Ron Bailey, that Whitehall scourge of counter-revolutionary forces and ardent upholder of anarcho-syndicalism—it is on the record now!—who, along with Jacky Howe, has been immensely helpful and influential behind the scenes. I also thank the Micropower Council for its support and hard work, particularly in encouraging members of the public to make known to their representatives their feelings about the importance of these measures.

The purpose of the Bill is to help the United Kingdom to meet its carbon reduction target of 80 per cent. by 2050, to help to tackle climate change and fuel poverty, and to increase the diversity of our energy supplies, thus making us both greener and safer. It aims to make it easier for households and businesses, including agricultural businesses, to generate energy in a more sustainable way, and to contribute to the meeting of the challenging renewable energy target set for 2020.

No one should underestimate the scale of the task ahead if we are to meet the climate change targets. Nor should anyone underestimate the benefits of moving swiftly towards those targets, not only the benefits in avoided costs—as Members will recall, the key message of the Stern review was that if we do not take action now, the consequences will be vastly more expensive and difficult—but the positive advantages of job creation, economic security, technical innovation and investment. In addition, if the United Kingdom is seen to take a real lead in practical terms, not just in terms of rhetoric, that will greatly strengthen our negotiating position in the vital international discussions that are taking place this year in the run-up to the summit at Copenhagen.

It is often the small, humdrum changes that make a big difference. The Bill contains a number of small measures: changes to permitted development rights for air-source heat pumps and micro-wind turbines, the inclusion of small-scale combined heat and power in the definition of green energy, the extension of permitted development rights for microgeneration to non-domestic land, and a timetable for a revised and up-to-date microgeneration strategy that includes raising the capacity limit for microgenerated thermal from 45 kW to 300 kW, which may help significantly with the development of community-based heating schemes.

I believe that all those measures add up to something potentially substantive. Above all, perhaps, they should make it easier for more people to benefit from green energy, with the added benefit of enhancing social engagement in the cause of carbon reduction. They may also help social cohesion where small, community-based schemes are made possible and introduced, bringing people together and—literally—empowering them. That is a useful social spin-off from the implementation of the micropower agenda.

In dealing with the whole question of climate change, we need to be bold, we need to have vision, and we need the grand designs; but we need to get the detail right as well, and we need to get people involved. That will only happen if there are easy, low-cost ways of getting involved. In green circles there is much talk of behaviour change, but it will not happen unless political policies are in place that enable people to change their behaviour. It was put to me the other day that the main religions of the world have been working on behaviour change for millennia without any notable success, and that human beings remain at heart selfish, short-term chimpanzees.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I should make it clear that I am certainly not speaking for my constituency, although I may well be speaking for that of my hon. Friend.

Chimpanzees respond to bananas. They respond to incentives. We need incentives: we need to make life easy, and we need inducements and encouragements. We certainly do not need punishments—and we do not need any number of Government strategies and reviews.

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

I congratulate the hon. Gentleman on getting this far with his Bill. He was right to say that all-party co-operation has made that possible. May I pick up his point about incentives? Does he agree that it is slightly disappointing that the Government were so opposed to the part of the original Bill that would have helped to preserve people who used microgeneration in their homes from the danger of increased council tax, and does he share my hope that the Government will deal with the problem at a later stage?

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

The hon. Gentleman makes a very good point, and I made it clear in Committee that I was disappointed that that clause—clause 6 in the original Bill—did not find favour with the Government. It seems to me illogical that people who take the trouble to invest in improving their properties by installing micropower may face an increase in their council tax on revaluation. That is anomalous, and if this Government do not change it I hope a future Government will.

Returning to the need to engage people and the importance of accumulating small, detailed measures to make changes—and moving rapidly away from chimpanzees and bananas—one of my favourite quotes is, I think, from Ghandi. I have not managed to trace the source of the quote, and I would be very grateful if anybody can, but what Ghandi said was, "The effect of an insignificant action is greater than the effect of no action by a factor of infinity. And when a multitude each takes an action which may itself seem insignificant, the effect can be huge."

The Committee stage was a thoughtful and useful process. It also enabled the Minister of State, Joan Ruddock, to make the very welcome announcement that the Department for Environment, Food and Rural Affairs had committed to a complete review of the environmental consent process for micro-hydropower. That is very welcome news. When the Minister makes his—no doubt brief—contribution to this debate, I would be grateful if he would let us know a little more about the detail of that review, and in particular the timetable.

If the Bill completes its voyage to the statute book, I hope that it will be regarded as a useful piece of legislation by the micropower industry, consumers, households and green campaigning groups. However, as I said on Second Reading, lack of time is always potentially lethal to private Members' Bills, and on that basis, and in anticipation that the House will wish to debate the commendable Industrial Carbon Emissions (Targets) Bill, which Mr. Kennedy will introduce later this morning, I shall conclude my remarks with an exhortation to Members, and in particular the Minister, to keep their contributions brief.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras 10:02 am, 3rd July 2009

As this is the first time that I have spoken in the Chamber since you were elevated to the Chair, Mr. Speaker, may I congratulate you and wish you well? May I also make it clear that it is not my intention to delay proceedings on this Bill, or the commencement—or even termination—of Bills further down today's agenda?

I welcome the Bill and congratulate Mr. Ainsworth and his fellow sponsors of all parties, including, rather unusually, my hon. Friend Mr. Dismore. The Bill's proposals augment, in part at least, the Energy Act 2008 and the Climate Change Act 2008, which the Government successfully piloted on to the statute book. I particularly welcome the Bill's clarification of the fact that green energy includes energy saving and efficiency measures. They are not especially glamorous; they do not stand out as much as alternative sources of producing energy either physically, in people's minds or in most of the talk about trying to reduce our carbon-based energy consumption. Double glazing is not as eye-catching as a windmill. However, although energy efficiency and saving do not get the attention they deserve, their scope for benefiting us and the whole of mankind is enormous. Huge amounts of energy are still being wasted, and we can reduce that wastage quite quickly. Investment in energy saving produces much quicker returns than money invested in windmills, heat pumps or photovoltaics.

Most things in life involve dilemmas; there are advantages and disadvantages. Energy saving, however, is almost dilemma free; it is mostly gain. If we save energy, we reduce the need for carbon-based supplies—or, indeed, supplies of energy from any source. Through energy saving, we can rapidly reduce the cost of heating and lighting, because if we reduce the amount we waste, we have to buy less and that costs us less. The installation of energy-saving measures also creates jobs in the supply of various materials and in the process of installation itself, and the great virtue of that is that it will be done in homes and businesses in this country by people in this country; the jobs created by the installation of energy-saving measures have to be carried out here, not by some impoverished person working for the tyrannical regime in China.

There is also a very substantial element of social justice involved in pushing forward with energy-saving measures, because it is a lamentable fact that the worst-off families and pensioners tend even now to be living in the worst insulated homes. They are getting the worst of all worlds: they are not keeping warm, yet they are paying more for their gas and electricity than better-off people who are keeping warm. That is absurd. I therefore welcome energy efficiency and its inclusion in the definition of green energy.

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Photo of Justine Greening Justine Greening Shadow Minister (Communities and Local Government), Vice-Chair (Youth), Conservative Party

The right hon. Gentleman raises an important point, and I would like to take this opportunity to put on record my support for the Bill. The more we can kick-start these technologies, the better they are likely to develop and the less they will cost, which will make them more affordable to a broader cross-section of the population. Today we can perhaps start a snowball effect that gradually makes all these technologies, whether energy efficiency or energy saving, available to everyone. Also, as the right hon. Gentleman says, often it is lower income people who suffer most from poor energy usage.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

I entirely agree. This point is probably most starkly illustrated at present in the field of photovoltaics, which are currently very expensive, but if they were produced in tens of millions of units, the unit cost would come hurtling down. We have seen something similar happening in IT, and there are some strong parallels between that industry and photovoltaics.

The Government should be stepping up their action in this area. I know there is talk of reducing capital investment, but in my view there ought to be more Government and private capital investment in energy saving, particularly in people's homes. That is green, and it would save energy, create jobs and promote social justice, all of which cannot be said for many things in this life. I am therefore strongly in favour of it.

There must also be energy efficiency in non-domestic buildings. A lot of businesses need to do more to reduce their consumption. Quite a lot of them spend quite a lot of money on the physical security of their offices, factories and warehouses, but the fact of the matter is that despite the value of all the things that might be vandalised and stolen, they lose a lot more every day from energy escaping through the roof, chimneys, doors and windows of the buildings that the security guards are roaming around. I think they need to pay a lot more attention to that.

We must also recognise that there is a great deal of waste through overheating and over-lighting. As for the IT industry, I always smile wryly when I see somebody being interviewed on television advocating green measures while they are standing in a room with about 40 visual display units flashing away, with all the electricity consumption that that entails. I also think that there is a timeless element to energy saving, because once we have done it, we have done it—we may need to do a bit of maintenance occasionally, but it is done. Any form of energy production that we consider may go out of fashion, or its relative costs may change, whereas the relative gains of energy saving are permanent and continuous.

I am not a recent convert to the idea of energy saving. I can recall that within two or three days of being elected to this place some 30 years ago I had a drink on the Terrace—I have not done that very often since, but that has nothing to do with the particular incident I am describing—and talked to someone who had been a No. 10 adviser to the Callaghan Government. I asked why the Government were not putting more money into energy saving and instead of putting more money into building power stations, to which the response was, "It is so much more difficult to monitor and control that sort of investment, and it is less easy to demonstrate to the public that it is being done." That did not seem to me to be a particularly good answer at the time and it has not become one since.

When I first started working for a living, I worked for the Central Electricity Generating Board, whose chairman at the time was a most distinguished engineer, Sir Christopher Hinton. He was the boss of the generating organisation; he was probably the person who made possible the establishment of nuclear power stations, and he did that by what can only be described as engineering and managerial genius. He also had a great deal of common sense. He used to upset the marketing side of the electricity industry by saying that it was making money out of ridiculously high temperatures in offices. Even at that time—this has grown since—the custom was that everybody went to work and then took off their jacket. He used to say, "I can remember when I was a graduate engineer for the Great Western Railway at its Swindon offices. During the winter we did not just wear a jacket; we put on a jumper or a waistcoat under our coat in order to keep warm." He pointed out that if everybody in an office in Britain did that, we could probably close two 2,000 MW power stations. So we need to examine our own individual behaviour to see whether we could tolerate not being roasted in a hotel, train, plane and so on—it does not matter what example we use. We ought to be pursuing that approach; we ought to try not to consume energy wastefully through our own behaviour, rather than just look at other people's energy saving.

I move on to the other aspects of the Bill, which do involve dilemmas. The microgeneration proposals for dwelling houses and non-domestic land are intended to make it easier to install wind turbines—I call them windmills, because I am so old-fashioned—or air source heat pumps, and I am in favour of doing that. The proposal seeks to make it easier by amending the permitted development controls, and I support that. In relation to the proposal's application to domestic buildings, we need to take care not to end up with someone's wind turbine causing a nuisance to the house next door, the flat upstairs or the flat below. That is not likely to happen where modern, properly installed and continually well maintained wind turbines are involved, but wind turbines will need to be modern, of a high standard, properly installed and continuously well maintained. I do not know whether they already have a noise rating, but we clearly need to address that issue.

I do not say that because I want to prevent wind turbines from being installed. I want them to be installed and I do not want to be negative about things, but it would be a real setback if some are installed using the general permission only for there to be a tremendous row about a particular incident involving a particular old lady who is being driven mad by the windmill next door. All the enemies of all the green measures that we wish to push for would jump on that, publicise it and gloat, and could set back all the developments that we want to take place.

I note that the Bill's definition of "non-domestic land" for these purposes includes "buildings" and that the proposal would not apply only to rural areas. I am happy about that because my constituency is at the urban end of things, despite containing Primrose hill, Chalk Farm, Oak village, Elm village and so on. Much more use should be made of non-domestic urban buildings as, in effect, the towers for wind turbines. There is a great deal of scope for wind turbines in urban areas, provided they are not too intrusive on particular parts of the urban landscape. I say that because urban landscapes are just as valuable as rural ones and many of them need to be protected. The source of electricity in some shopping streets could literally be above the shop.

One of the most famous sights in my constituency used to be the gasometers behind St. Pancras station. Some of those have been temporarily demolished, whereas others have gone for ever. Their example prompts me to suggest that a perfectly sound site for wind turbines, and one that would be inoffensive in terms of the urban landscape, would be on top of the new, modern extension of St. Pancras station. We need to take that sort of approach all over our urban areas.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

Obviously I know the site well, and I agree entirely with the right hon. Gentleman's suggestion. Would he be willing to join some of us in speaking to people at Network Rail, which looks after some of the big sites in London? We could suggest several huge railway sites whose use in this regard would be consistent with what goes on at the moment and inoffensive in terms of tradition. They present very good opportunities to get new sorts of energy into the middle of the capital city.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

As my constituency is the proud possessor of King's Cross, Euston and St. Pancras stations, I have a bit of an interest in major railway stations and the approaches to them. I have already made a suggestion about St. Pancras, King's Cross is being redeveloped and a proposition for the redevelopment of Euston station is rather further back—I am meeting the proponents of that next week and I intend raising this matter then.

One other thing that I should say, if this is not too far off the topic, is that huge swathes of land in my constituency and in other parts of inner London are alienated by having a railway running over them. These railways are sometimes 10 or 20 tracks wide, and I recall that when I was leader of Camden council I got the engineers to look into the possibility of building over the railways as they come into the main line stations. We cannot create any more land, so we must make better use of what we have. Perhaps some sources of new energy could be built into those areas, if what I suggested were to happen.

I come back to my main point about domestic buildings, because I think we need to be very careful about using the general permission approach in respect of non-domestic buildings. We need to ensure that all these things are subject to the consideration of their impact on neighbours, be they commercial and business neighbours or, as is most likely, residential neighbours. That would help to promote microgeneration while also being sensitive to neighbours. It should not be too intensive or intrusive in particular landscapes, whether urban or rural. Instances of microgeneration being unpopular, or being exploited by newspapers and complained about week in week out on the "Today" programme on the BBC, would not help to achieve any of the benefits that we are all hoping for.

On the whole, I very much welcome the Bill. I congratulate the hon. Member for East Surrey on introducing it. I hope that it succeeds and that we can get on to the other measures that are before the House today.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change 10:21 am, 3rd July 2009

I wish to take my first opportunity to congratulate you warmly, Mr. Speaker, and wish you all the very best.

I also congratulate Mr. Ainsworth on his choice of Bill, his stewardship of it, and his co-operative efforts to get his key objective on to the statute book, which look as though they will succeed.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I am grateful to the hon. Gentleman for giving way and I apologise to you, Mr. Speaker, for failing to welcome you to the Chair in my previous remarks, as that was the first time that I have contributed since your elevation. I also apologise for not mentioning the very co-operative assistance that I have received from Liberal Democrat Members on the Bill.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

The hon. Gentleman is very kind. I know that my hon. Friend Steve Webb, who did my job when the Bill was introduced, is happy to be a sponsor, and also that my hon. Friends the Members for Cambridge (David Howarth) and for Cheltenham (Martin Horwood) were happy to serve on the Committee. My hon. Friend the Member for Cambridge is in his place today to ensure that the Bill proceeds satisfactorily today.

I shall be brief, because I made my substantive points on the Bill at Second Reading. My core point is that we will again have a microgeneration strategy for England. That is what we need as part of the energy mix. My vision is of a country where energy is not provided for people by bigger and bigger organisations run across borders with less and less personal control, but instead where we regain personal control of the link between the energy we need and the use that we make of it. The more we can make the link between the person and the provider—between the village, town or community and the provider—the better.

It will be good for this country if people can begin to see that link. It will encourage the sort of initiative mentioned by Frank Dobson. If people realise that the wind turbines or solar panels at King's Cross, Euston or St. Pancras—or at London Bridge station in my constituency—provide the heat or energy for their community, they are more likely to be positive about them. Indeed, just outside London Bridge is SELCHP—the South East London Combined Heat and Power plant—which has been there for 10 years. It is an incinerator so it is more controversial, but it had the same intention of linking the communities with the production of energy, in what was thought to be the best way at the time. Microgeneration should be part of the energy mix and it should come from individuals and communities as a contribution to the grid.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

The hon. Gentleman said "again", so he recognises that we have already had a strategy. He mentions the public face of the strategy, but does he agree that, as I have found in my discussions with the supply chain, people are more confident about investing in their businesses, equipment and the skills of their work force if a strategy is in place?

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

That is true, and I concede that there has been a strategy, but this new strategy will ensure that our efforts do not stop.

The second good thing about the Bill is that it includes dates and deadlines. The first is that the Bill will come into force within two months of the date on which it is passed. That is much shorter than many pieces of legislation, and it is very important. Other deadlines provide that the consultation must begin within six months of the coming into force of the Act and must be published within six months, beginning with the end of the consultation. The only thing that is not specified is the length of the consultation. I ask the Minister to ensure that the Government take as long as necessary for the process to be perceived to be fair, but not so long that it loses momentum. I am sure that they would not want that to happen, but we need a commitment from the Front Bench to keep up the pressure—

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

To make the obvious point, the Cabinet Office guidelines on consultations are that they should take 12 weeks. We will not truncate the consultation, and nor would we want it to overrun.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

My third point is about definitions. We had a debate on Second Reading about the phrase "green jobs", which was in the original Bill. The Government were all over the place on that definition at the time. The Prime Minister was promoting green jobs from the Front Bench, but one of his ministerial colleagues said in a parliamentary answer that there was no such thing as a green job, because all jobs were green jobs, so it is probably good that the attempt to define a green job has disappeared from the Bill. My colleagues and I hope that more and more jobs will be genuinely green jobs that provide sustainable solutions to our economic and ecological crisis, but any attempt to limit and circumscribe that definition to certain things to do with the energy industry is probably inappropriate.

The definition that remains in the Bill of "green energy" is not as controversial. Clause 1(1) states:

"The principal purpose of this Act is to promote green energy."

We all know what we mean by that—at least, we think we do—but the Bill defines it more specifically. We had two small debates about this point in Committee. The Bill defines it as

"the generation of electricity or heat"— the word "heat" was a welcome addition in Committee—

"from renewable or low-carbon sources".

It also contains a capacity limit of 5 MW for electricity and 5 MW thermal for heat. I am happy with that definition for the purposes of the Bill, but I would not want to think that that would be the final word on the definition of green energy. My hon. Friend the Member for Cheltenham made the point in Committee that some of us do not think that nuclear energy is the green energy that others may think it is. Energy produced in such a hugely complicated and technological way is not green energy. I do not want to open the Pandora's box of that debate, but I make the point that the definition in the Bill works well. We are talking about small schemes in this instance, but I hope that when we have other debates on strategy for energy policy generally we can look at what we mean by green energy and reach common agreement.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

As the hon. Gentleman knows, there is no such thing as small-scale nuclear energy generation.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

I do know that, and I read that the hon. Gentleman made that point in Committee—

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

That could be a new strategy to try to gain friends and influence people by the nuclear industry— [ Laughter. ]

To complete my words on the definition, it is good that as well as the Bill's principal purpose of promoting green energy it retains two other objectives: the desirability of alleviating fuel poverty—that point was mentioned by the right hon. Member for Holborn and St. Pancras in the context of his constituency and it is also a big issue in mine—and the desirability of securing a diverse and viable long-term energy supply. Those two objectives are properly retained, and I am very pleased about that.

May I add my usual rider? I am never sure that fuel poverty is the right phrase—it is not what people talk about on the Caledonian road, the Old Kent road or in the villages of Staffordshire or Surrey. We need to talk about warm homes if we mean warm homes and we need to use phrases in this debate, as far as possible, that people can relate to and that are understandable.

Finally, I note that two parts of the Bill have disappeared, and I lament their passing. One has been referred to and one has not. We have lost the good but controversial proposal—described in Committee as radical or revolutionary—to offer people an incentive to have green energy at home: introducing microgeneration or energy efficiency measures would affect what occupiers paid in council tax. Obviously, my hon. Friends and I are not supporters of council tax as a method of paying for local government services, but there will always be a method of some sort and we think that, if that method is attached to the property, there should be ways of incentivising people to ensure that they see the benefit of such a move. I am sad that that provision has gone, but the issue will not go away and will come back elsewhere.

The other provision that disappeared in Committee was the requirement that in updating the microgeneration strategy the Secretary of State should at least consider financial and fiscal measures. I hope that the Minister can reassure the House that such measures will at least be considered as part of the process of updating the strategy. Carrots and sticks are always important as we change people's culture and behaviour, and financial and fiscal carrots and sticks are probably the most useful things that the Government can introduce. We all respond positively to financial and fiscal incentives and the Government have the mechanisms to introduce them. They know that they use them in every Budget and regularly at other times.

I do not want to go on further. This is an important Bill and I am sure that the House of Lords will be keen to ensure that it continues its passage and becomes law in this Session. We have two very important green Bills on our agenda this morning. My right hon. Friend Mr. Kennedy is waiting patiently to propose his, and we look forward to that. We could do very good work if the Government responded positively to both of the Bills. I know that they will respond positively to this Bill; I am not so clear about whether they will be quite as positive about my right hon. Friend's Bill. I hope that they can be persuaded.

This Bill has been a piece of very good work. The hon. Member for East Surrey is to be commended and we all wish him and his Bill well. It will make a difference to the energy sources in this country, to people's engagement with the production of energy and to the response to the terrible risks to the climate about which we increasingly know.

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Photo of Gregory Barker Gregory Barker Shadow Minister (Energy and Climate Change) 10:33 am, 3rd July 2009

It is a pleasure to follow the thoughtful and interesting speeches of Frank Dobson and Simon Hughes. The right hon. Gentleman was absolutely spot on; he made the point about the absolute imperative of energy saving extremely well. In the 21st century, energy saving is the great no-brainer, but we need to provide greater leadership and incentives for people to grasp the energy saving agenda. However, that is business for another day.

I am delighted to be welcoming the Bill back to this Chamber for Third Reading. I congratulate my hon. Friend Mr. Ainsworth on his not inconsiderable achievement in bringing this important Bill so far. I am sure that his delightful, intelligent and responsible constituents will be extremely proud of the measure.

I am also pleased that for a second year running those on our Benches have produced an ambitious and progressive Bill which will drive forward the climate change agenda. The green energy and microgeneration agenda lies at the heart of the new Conservative vision for a low-carbon Britain. It also proves that even in opposition there is the opportunity to make a real difference.

It is a testament to the importance and substance of the Bill as well as to the skills deployed by my hon. Friend that he has been able to attract such a wide degree of bipartisan support, as reflected in the cross-party support of a number of Members whom he has gathered. That is more important on this issue than on almost any other. Climate change calls for a new form of responsible politics and it is critical that we embrace bipartisan politics and consensus where possible, not because it makes the passage of any one Bill any easier but because of the very important signals that such consensus sends to the outside world. It not only shows our determination to tackle this agenda but sends out a critical message about long-term direction and strategy to the capital markets.

The Bill hints at the huge scale of investment, the large part of which will come from the private sector, that will be required to transform our economy over the next decade, not in a piecemeal or step-by-step way but in an almost revolutionary way. It is vital that we in this House act responsibly in giving that long-term direction to the capital markets, the private sector and large and small investors so that they can have faith and confidence in the agenda, which will outlive any Government, any Parliament or any party leader. It is something that Britain plc is determined to see through and it will outlive all of us.

I am pleased that despite major changes to its wording the Bill that went into Committee has in the most part been preserved. The changes in Committee were mostly constructive in clarifying and strengthening the Bill's intent. I support efforts made by the Minister and his officials to bring the definitions and language of the Bill into line with its parent legislation, the Energy Act 2004. Indeed, it is appropriate that a Bill concerned in part with definitions should have been improved by amendments that reinforce the use of terms such as "renewable or low-carbon source", which not so long ago were poorly understood and vague and are now part of the established vocabulary of climate change legislation in this country. I am also pleased that the Minister made allowances in Committee to include heat in the Bill. Heat makes up more than half of UK carbon emissions and measures to promote low-carbon, small-scale heating will be an important part of rising to the significant challenge of decarbonising our heat supply.

I followed with interest the record of the Committee's proceedings, particularly the confusion over the feed-in tariff cap for combined heat and power. My hon. Friend Charles Hendry was typically perceptive in his questioning and both his point and the Minister's response satisfy my concerns over the apparent contradictions between this Bill and the energy legislation over the level of the cap.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I agree with the hon. Gentleman's comments about Charles Hendry, who was very perceptive in Committee. Has Gregory Barker seen the letter that my hon. Friend the Minister of State sent to the hon. Member for Wealden to clarify that point afterwards?

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Photo of Gregory Barker Gregory Barker Shadow Minister (Energy and Climate Change)

I have indeed; I have it beside me, in fact.

As I said on Second Reading, in promoting local energy economies and facilitating the permitted development of low-carbon solutions this Bill will do much to empower smaller generators of power, whether those generators are households, businesses, communities or community-based organisations.

The tackling of the issue of permitted development is particularly timely, as for too long there has been a lack of consistency between words and action on the ground. Permitted sound levels for air source heat pumps and small wind turbines have caused a great deal of confusion and anger in the industry, with some small entrepreneurial firms brought to the edge of bankruptcy by delays and confusion in decision making. Ultimately, I hope, the Bill will help the Government to join up their thinking on microgeneration and ensure that there is an impact out there in the real world.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

After the Bill has achieved Royal Assent, as I hope that it will, one thing that the hon. Gentleman might do, possibly with the help of Mr. Ainsworth, is ensure that those farmers, landowners and householders who have had frustrating experiences in trying to develop their new energy sources can come together and share them, so that Ministers can really respond, particularly as they change the planning regulations.

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Photo of Gregory Barker Gregory Barker Shadow Minister (Energy and Climate Change)

It is an excellent idea that we should share experiences, because there are a lot of individuals—I have them in my constituency—who just do not seem to be able to get through the tangle of rules, yet they are trying to respond to the national agenda. I would be happy to work with Simon Hughes on that.

As I say, ultimately, the Bill will help to join things up, and will cut through the tangle of legislation with new purpose. Meaningful consultation with stakeholders in non-governmental organisations and the industry is required in any microgeneration strategy, and conversations will need to be had between officials in the Department of Energy and Climate Change and those in the Department for Communities and Local Government to ensure that pre-permitting is fair. That will give a much-needed boost to our deployment of small-scale low-carbon technologies, many of which are still in their infancy but show real signs of potential. They are being spurred on by the new surge of innovation that is coming through as we start to develop in earnest a low-carbon energy economy. To that end, I ask the Minister to consult on fiscal and financial measures in drawing up the strategy. He will correct me if I am wrong, but I think that it was clause 4(3)(b) that was removed in Committee. I ask him for reassurance that, although that provision is no longer in the Bill, fiscal and financial measures will be an important part of his consultation.

I should like to finish by acknowledging, as did my hon. Friend the Member for East Surrey, the extraordinary force for change that is Ron Bailey and his team. I also thank the officials who have done so much to bring the Bill into line with other relevant legislation while maintaining its obvious powers, and colleagues on both sides of the House who have supported and endorsed the Bill in the Chamber and in Committee.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change 10:42 am, 3rd July 2009

May I start, as everybody else has done, by congratulating Mr. Ainsworth on his choice of subject, which is a perfectly good one, as we have found in this good debate? The Bill is well supported in every part of the House. I also congratulate him on his persistence in ensuring that it got this far—I hope that it will go all the way to the statute book in the not-too-distant future—and on his co-operative approach. He does not just say that such issues need cross-party co-operation; he demonstrates it by his behaviour.

As the hon. Gentleman acknowledged in answering an intervention of mine, he had good relations with the previous two Ministers responsible for handling his Bill. When the Minister of State, Department of Health, my right hon. and learned Friend Mr. O'Brien, was a Minister at the Department of Energy and Climate Change, he had a meeting with the hon. Gentleman. At the time, it was not entirely clear to the Minister from the advice that he was receiving that he should support the Bill, but he and the hon. Gentleman together saw the value of it as a vehicle for promoting microgeneration more widely in this country. My right hon. and learned Friend made a difference, thanks to his meeting with the hon. Gentleman.

When my right hon. and learned Friend moved on to other business, my hon. Friend the Minister of State, Department of Energy and Climate Change took over. She conducted the Bill through the Committee. The slight thing that I have done to assist so far is to secure the money resolution for any expenditure that will be needed to put the Bill into effect practically. She worked hard with the hon. Gentleman on the amendments that made the Bill acceptable to the Government and, as we have heard, to the House. Gregory Barker acknowledged that most of the amendments in Committee were constructive and have improved the Bill, and that is pleasing for all of us.

I think that my two predecessors would agree that it is a pleasure working with the hon. Member for East Surrey—a pleasure that I have enjoyed for many years in other settings before recently becoming a Minister. I should like to join others in paying tribute to all the members of the Public Bill Committee for the constructive and helpful discussions that characterised their debates in Committee on this important Bill.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I am blushing horribly at the Minister's kind remarks, for which I am very grateful. He will be aware that the process is not over yet; the Bill now has to go to another place. He will also be aware that there appear to be some timing problems in the other place, regarding when it can consider the Bill. I hope that he and his colleagues will do all that they can to get it listed for debate in the other place on 10 July, because if the debate does not happen then, there is a risk that the Bill, which everybody seems to support so strongly, will fail to get into the final harbour and on to the statute book.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

The hon. Gentleman pre-empts a point that I would have liked to have made later. I will make it now instead. I anticipate, from all that has been said so far, that the Bill will be agreed to by the House today, which is welcome. It will go to the other place, where it will need some time, as he says, in order to be agreed to there, too. The Bill has had the detailed debate, consideration and scrutiny that will, I hope, satisfy Members of the other place that it needs very little additional attention at their end of Parliament. I hope that they will not take too long over it. I am conscious, as he is, that there is some pressure on the time that can be given to the Bill in the other place, especially before the summer recess. Clearly, if it has to start its passage there in the autumn, it will have limited time in which to get through all its stages there. Members of the ministerial team in my Department are conscious of those difficulties, and we will do all that we can to ensure that it has a safe passage through the other place and becomes an Act of Parliament in the autumn; that is what we want to happen.

The Green Energy (Definition and Promotion) Bill represents an excellent opportunity for us to build on the solid foundation of the Government's ongoing support for small-scale on-site low carbon and renewable energy generation. Part of that makes clear the Government's ongoing support for microgeneration. That support has developed as a result of actions included in the Government's current microgeneration strategy, a point that I raised with Simon Hughes.

The Government see an important role for microgeneration installations, which are small-scale on-site energy technologies. Microgeneration, such as small-scale heat pumps in local community halls, can engage and interest communities in generating their own energy. It can also help us, as a nation, to tackle climate change and achieve energy security. I am pleased to say that the Government are continuing that impetus by maintaining their strong support for the Bill as amended in Committee.

We talk about microgeneration in the abstract, and in the legal terms of definitions, but it actually makes a difference in people's homes and communities, as I have seen in my constituency. I recall visiting a man, in his cottage in a conservation area, who had installed solar thermal in the roof of his property. He was confident that he was making a difference to his energy bills, and contributing to tackling climate change. Of course, he was a member of a community. All his neighbours saw what he had done, and hopefully will be willing to follow his example. To digress for a second on to the subject of permitted development rights, which I shall talk about later, he put in his installation before there was general permission to do so, so he had to go through the planning process. As he was in a conservation area, he also needed consent. It is important to point out that the Bill retains the ability of local authorities to impose limitations and conditions in certain circumstances, such as those where the property is in a conservation area. That way, they can ensure that character is not damaged in pursuit of a fine objective, such as tackling climate change or lowering people's energy bills.

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Photo of Simon Hughes Simon Hughes Shadow Secretary of State for Energy and Climate Change

I welcome the Minister to his responsibilities. Will he agree to meet, at some time convenient to him, the sponsor of the Bill, Mr. Ainsworth, Gregory Barker and me so that we can provide examples of people whose proposals, possibly including some that might apply in national parks, would not offend the wider conservation interest, but who have struggled to get through the system, so that we can achieve the best possible process, both in special areas—conservation areas and others—and generally?

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

The hon. Gentleman knows that I am a new Minister, so I am very much in meeting mode. How could I resist such a polite request to meet people with an interest that I share personally to discuss such issues? We will make arrangements for that to happen in due course.

I want to mention one or two of my own experiences which show the practical support that exists for microgeneration, which we need to tap into as a result of the Bill. I want to describe the day I climbed on to the roof of my local school, King Edward VI high school—as I am mentioning that, I should declare an interest: both my son and my daughter went to that school. It had installed a solar thermal installation on its roof to contribute to the heating of the school's water. The people at the school were very proud of the installation, because it immediately provided a reliable source of energy and they saw a reduction in heating costs. They wanted me to come to the roof of their building to celebrate their success with them.

The point about a school having a microgeneration installation is that it is educative in the general sense. The entire school population every day was seeing and benefiting from that installation, so when my right hon. Friend Frank Dobson talks about having microgeneration installations in public places such as railway stations, I thoroughly agree with that suggestion because of the educative effect, in addition to all the other benefits, that such public sitings can provide.

Another example that I shall give from my experiences of microgeneration installations—yet again a solar thermal installation—is the Staffordshire wildlife trust in its headquarters in the beautiful rural location of Wolseley Bridge, just outside Stafford. With the help of the industry, which wanted a public display of its technology, and with the help of a grant under the low-carbon buildings programme, the trust was able to have both the installation and install a real-time meter in the entrance to its premises. There was an interpretation board next to the real-time meter to provide an explanation to the thousands of visitors who come to the centre every year so that they could see and learn more about microgeneration installations. That is a good example of educating a much wider audience than the people who benefit directly from the installation.

In case the House thinks that the only thing I can talk about is the Stafford constituency, brilliant though that constituency is, I want to draw attention briefly to the Sustainable Development Commission's latest report, "Sustainable Development in Government 2008", which contains a marvellous photograph of the Foreign and Commonwealth Office's Wiston House. It is a beautiful building, in a beautiful location in a rural setting, but the importance of the photograph is in the forefront—the biomass boiler fuelled with woodchip taken from the surrounding woodland, giving a carbon saving of 160 tonnes per year. I know that hon. Members would say the Government should go further and faster, but that is one instance of the Government setting an example and demonstrating the benefits of microgeneration installations.

I do not need to remind hon. Members of the difficult economic times that we face at national and global levels. While Governments must deal with the problems and consequences of the global recession, we must also bear in mind that, at this point in history, there can be no relaxation of our need to focus on the importance of sustaining our individual, national and global efforts to tackle the major challenge facing us all—climate change. We cannot shelve the issue until we have steered our way out of the economic downturn. Mañana is not the time to tackle it. Tomorrow will be too late.

The Stern review demonstrated that the costs of responding to unchecked climate change are incomparably higher than the costs of taking action to combat it now. The review also estimated that the economic and environmental costs of a failure to act could be as much as 20 per cent. of GDP or even more.

The current glorious weather in Wimbledon week seems to improve the quality of life in the British isles, but the current unusual health warnings may well foreshadow similar warnings in the summers of 2030, 2050 or 2080. Children being born now will have to endure these and other extreme events as a result of changing weather patterns. They will be only 40 years of age in 2050, by which time we need to have reduced our carbon emissions by 80 per cent.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

It has been glorious weather for Wimbledon, although probably rather too hot. I am told that the temperature in central London yesterday hit 32º C. Meanwhile, in other parts of the country there has been torrential rain and flooding. Is that not entirely consistent with what the scientists have been telling us for a long time about the likely effects of climate change?

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

Of course, with my new responsibility for fuel poverty, I have learned a great deal more about excess winter deaths—the increased number of people who die in the winter months because of the cold—yet recently we had a summer when there were excess summer deaths because of a heat wave that was outside the norm. I agree that the evidence before our very eyes is quickly catching up with what the scientists have warned us about for many years. It must be increasingly difficult for the few deniers of climate change and its causes to maintain their opposition.

We must not be lured into excuses or slacken the pace at this crucial point. DEFRA recently released the UK climate projections, which give climate information for the UK up to the end of the century. The projections are based on a new Met Office methodology. It allows a measure of the uncertainty in future climate projections to be included in the information, but that element of uncertainty only covers a range of negative scenarios, not the possibility that climate change is not happening at all, a point reinforced by the hon. Gentleman.

Almost all climate scientists agree that the climate is changing and that that is due to man-made climate change, caused mainly by an increase in emissions of human-made greenhouse gases, such as carbon dioxide from burning coal and oil. I am informed that the Met Office has graphically described it as heading into a change of temperature equivalent to

"the opposite of an Ice Age".

Changes of this magnitude normally take thousands of years to develop, but in this case have taken just over 100 years. I hope hon. Members will agree that this is no time to downgrade climate change from being the leading challenge facing humanity today. Everyone who contributed to the debate had that as their unspoken text and motivation for their support for the Bill.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

Would it not be difficult for anybody to deny that some amount of climate change is taking place? Most people believe that humanity is contributing to that, but even those who do not believe that ought to accept that it is extremely stupid of us to waste the carbon-based energy supplies, which are clearly limited, particularly oil and gas.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I served on the Joint Committee of both Houses that carried out the pre-legislative scrutiny of the Climate Change Bill. We had evidence from Lord Lawson, who is one of those who would say that there are other causes of climate change, it will not all go in one direction endlessly and we have no reason to worry. I agree with my right hon. Friend that that is a very dangerous attitude to take on many levels.

My right hon. Friend mentions carbon-based fuels running out. We probably still have centuries of coal supplies. It is an expanding source of energy, particularly in developing countries, and it is urgent that we tackle the emissions that come from burning fossil fuels. However, as he says, it is so pressing, demanding and obvious that we should follow a precautionary approach and take the actions that we are describing here and in other forums. They are the right actions to take if we are to ensure that the world does not get into the dangerous circumstances that scientists say will otherwise prevail later this century.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

The Minister makes an extremely important point. Whatever anyone's views about climate change, does he not agree that we should have been promoting resource efficiency and energy efficiency anyway, and that in the developed west we have scandalously neglected those things for far too long? Dealing with those issues presents an enormous opportunity for good in the future.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I agree. This is a fascinating discussion, although we are in danger of going a long way from the Bill. The hon. Gentleman's point is important for two reasons. First, there is the great unspoken issue of population growth; there are already more than 6 billion people in the world, and some say that by the middle of this century, there will be 9 billion. In that context, resource efficiency is an important subject. Secondly, to be a little selfish for my own country, as we are all entitled to be, there will be skills and technologies from which we can benefit if we are more resource-efficient in future. Britain could be at the forefront of finding the technologies for low-carbon and renewable energy sources and benefit from immense trade in those technologies. There is every good reason for us to be resource-efficient.

I want to respond to one or two points made by the hon. Gentleman, and I shall answer the question that he asked me. He said that taking his Bill so far had been a privilege and a pleasure. I wondered about his use of the word "pleasure"; perhaps tonight, as he looks back on his Bill's successful passage, he will feel a lot more pleased than he does now in listening to me drone on in support of it. I was pleased that he recognised how the Government had co-operated with him during its passage.

My two predecessors have been models of co-operation with the hon. Gentleman. I learned the secret of his success in getting this far when my hon. Friend Mr. Dismore popped up and reminded us that he is a sponsor of the Bill. Recruiting him was a shrewd and clever move on the part of the hon. Gentleman.

I am also glad that the hon. Gentleman has recognised the contribution made by the civil servants. I am new to my post and have been with the civil servants for only a short time, but I, too, have been impressed by the commitment and dedication evident in their assistance to me and the House in getting the Bill into good order. Who could not join in the praise for Ron Bailey? I would not describe him as a scourge, but as a friend of the family to Parliament because of his work over many long years in pushing us along the route on which we should have been anyway. I am glad that he has been able to contribute to the hon. Gentleman's success today.

The hon. Gentleman mentioned that raising the heat capacity limit for microgeneration to 300 kW would benefit community projects, and I agree. The Government's entire intention was to see many more of the kind of community projects that I described—in schools, in wildlife trust centres and community centres. As well as being of public benefit in themselves, such projects are educative and mean that people learn more about microgeneration.

The hon. Gentleman also spoke about behavioural change. If he does not mind, I shall not follow his comments about chimpanzees; I shall merely say that he is right in saying that the policies have to be right if behaviour is to change. He mentioned that incentives should be a part of policy, and I agree—but it is only one among many parts. In a green revolution, regulation is an important part of the whole package. The hon. Member for Bexhill and Battle spoke, as I will later, about the need for investment in the sector. Strong, clear lasting regulation gives confidence to people so that they can make those investment decisions, so regulation is important, as well as incentives.

Investment is also important. As the hon. Member for Bexhill and Battle said, a lot comes from the private sector, but the public sector is also involved, especially when there is a need to pump-prime or kick-start projects when they begin. Some technologies would not have gone far without some public support and investment; now they are more established and look like making lasting contributions to our future strategy. As several hon. Members have said, sticks are important as well as carrots, and some of those sticks should be fiscal. I agree with all that.

My last example of the right policy relates to the setting of examples: we should ask people to do as we do, not as we say. If lights are on in Departments at night, that will be a bad signal to people; a biomass boiler at Wiston House, however, is a good signal.

Finally, I come to the question that the hon. Member for East Surrey asked about micro-hydro. In Committee and on Second Reading, there was pressure in favour of micro-hydro's being included in the Bill's extension of the permitted development rights, but the Government resisted that pressure. In Committee, my hon. Friend the Minister of State announced that there would be a review of the consent and licensing system for all hydro projects. As the hon. Gentleman demonstrated during the short debate on the night when I moved the money resolution, he knows that there are some difficult issues with micro-hydro, mainly because there is only one system for consents and licensing. It applies to every hydro project, however small or large. As a scheme could be very large, the system is complex and demanding. I can see that going through that process would be a great deterrent for somebody proposing a micro-hydro scheme. I am pleased that my hon. Friend announced to the Committee that there will be a review of the system to see whether we can come up with a second system for micro-hydro that will streamline the process and make things quick and easy for people who want to suggest good microgeneration projects that include a component of hydro.

The hon. Gentleman asked me to give some detail about the review. It will be carried out by the Environment Agency, which administrates the existing scheme. It has a time limit of one year to complete the review, to stay inside the time scale of this Bill in respect of the review of the microgeneration strategy. I hope that everything will come together for micro-hydro in a year's time. That is my wish.

My right hon. Friend the Member for Holborn and St. Pancras made an important point about the contribution that saving energy makes to tackling climate change and ensuring security of supply. He said that the issue should not be underestimated, and it is certainly not underestimated by the Government or the hon. Member for East Surrey. Energy saving is specifically referred to in the Bill. My right hon. Friend is absolutely right to say that it can cut costs for individuals. The Government estimate is that most people could save about £300 a year on their energy bills if they made their homes as energy efficient as possible. As he said, if we promote energy saving as an industry, that will create jobs in the supply chain. I am keen for that to happen, because one of my areas of responsibility relates to skills in the low-carbon economy, and I am keen to see an expansion of jobs—highly skilled and well-paid jobs—in the sector. That is my ambition.

My right hon. Friend also mentioned those who do not have the money to keep themselves warm in their homes. He said that the worst-off families and pensioners often live in the worst-insulated homes. That is why there is a fuel poverty strategy in this country. It has been going off-target in recent years because of high rises in fuel costs, so it is being reviewed this year. It is a sobering thought that many people in this country die in the winter months partly because of extreme cold from which they are unable to protect themselves in their homes. Last year, the figure amounted to 25,000 individuals, a statistic that should make us all determined to put energy efficiency at the top of our list of priorities.

My right hon. Friend observed that the more we can promote microgeneration technologies, the greater the likelihood that their costs will fall, which will put them within the reach of more people and more businesses, and therefore promote further take-up of microgeneration—a virtuous circle that all of us in the House want to achieve. When he went on to mention that a lot of businesses do not take up energy efficiency measures, he reminded me to say that in the Energy Saving Trust we have an excellent, trusted organisation that can give advice to domestic householders about energy efficiency measures. I would argue equally that we have an excellent, skilled organisation in the Carbon Trust, which gives similar advice to the owners of non-domestic business properties. I would urge any business that is wondering what to do about energy efficiency measures and what help there is for doing it to contact the Carbon Trust if they have not already done so.

My right hon. Friend noted that there is great waste in over-heating and over-lighting properties. At that point, I was reminded to state my message that Departments should also turn their lights off at night. The sustainable operations on the Government estate targets, which are monitored by the Sustainable Development Commission, help to ensure that Government set a good example; I am anxious that that is what we should do.

My right hon. Friend said that when he worked in the power sector, the boss, rubbing his hands, said that they made a lot of money out of the over-heating of premises. That reminded me of the importance of trying to incentivise energy companies to help people to make energy savings instead of simply promoting greater sales of their products.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

I would not like my hon. Friend to misinterpret what I said as meaning that the great Sir Christopher Hinton rubbed his hands with glee. He thought that it was absolutely stupid that the country was building two power stations so that people could take their jackets off at work. Indeed, he used to cause terrible offence to people selling electricity by insisting on having gas-fired central heating at home because he thought it was more efficient.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I am grateful to my right hon. Friend for that useful clarification. The attitude that he describes feeds into today's carbon emissions reduction target programme, whereby energy companies make a great commitment to helping customers to make energy savings in order to cut their bills. That is the kind of approach for the future that the Government want to encourage.

My right hon. Friend made an important point, which was not much taken up on the Liberal Democrat Benches, about the potential effect on neighbours of the installation of new micro wind turbines and air source heat pumps. One person's benefit can be a neighbour's nuisance, and it is important for us to ensure that we avoid any negative developments from what is a very good policy. That is why when the Government extended permitted development rights for many microgeneration technologies last year, further time was taken on micro wind and air source heat pumps in order to ensure that we got right issues such as noise and vibration and did everything possible to minimise the effect on neighbours so as not to attract negative publicity that would harm the cause of promoting greater microgeneration.

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Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

I am sorry to interrupt my hon. Friend in mid-flow.

It is likely that a wind turbine or an air source heat pump will be quiet and not vibrate much when it is first installed; the big problem is whether there will be high-quality maintenance. A car that is fairly quiet eventually turns into an old banger, and it is called that because it makes a lot more noise. We must try to ensure that there is sufficiently good maintenance so that a wind turbine does not become an old rattler that used not to be offensive but becomes so as the years go by.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I am grateful to my right hon. Friend. I was about to remind the House that the Bill permits there to be limitations and conditions on permitted development rights. I am not aware that we were planning to suggest that there should be a condition about regular maintenance, but certainly the advice and guidance would say that that is good practice. Today's modern designs do everything possible to minimise the risk of excessive noise and vibration. The time since the relaxations were introduced last year has been well used in terms of Government consideration and consultation about noise levels that might be acceptable to neighbours. I hope that when we come to make decisions about the precise detail of these permitted development rights we will strike the right balance between satisfying neighbours and those who want to install the technologies.

I am delighted that my right hon. Friend drew our attention to railway stations. I had forgotten that he had three such great ones on his patch—St. Pancras, King's Cross and Euston. I wish him the best of success next week in his meeting on Euston in terms of ensuring that microgeneration is taken into account as part of the design of the project for the refurbishment of that station, which I visit every week on my way to and from Parliament and my Stafford constituency. I agree that it would be a delight to see examples of microgeneration technologies at our major railway stations across London, always taking account, as he says, of preserving the urban landscape, which is just as important to this country as its rural landscape. His warning to us to get this right so that we do not have public misunderstanding and negative reporting by the media of microgeneration is an important one to act on after today. We want the media to join us in promoting microgeneration as something that is positively beneficial to householders and business owners, and to the wider aims of tackling climate change and ensuring energy security in this country.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I have said on every occasion when it has been possible to do so that I am certainly not in favour of a free-for-all in micro power that causes a nuisance. That is not the purpose of the Bill, and there are safeguards built into it. The Minister may wish to confirm that when consulting on any proposals to do with microgeneration in domestic properties, a noise limit of 45 dB from the nearest window of a habitation will be taken as a benchmark. I hope that that will provide enough of a safeguard during the consultation period for the Government to satisfy themselves that an installation will not cause a nuisance.

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

I am grateful to the hon. Gentleman. I certainly exonerate him from any suggestion that he is gung-ho about installing microgeneration anywhere at any time; of course, he has been extremely responsible, as are the Government. I am merely saying that we should continue to balance possible conflicting interests to ensure that we stay on the right side of the public and maintain their support. The limit that he mentioned is indeed the Government's thinking in terms of the permitted development right for wind turbines and air source heat pumps. A further reassurance that he did not mention—I will do so in order to join him in saying how responsible his attitude is—is that the whole thing will be reviewed after two years to ensure that it is attracting public support and that there are no areas that need any extra attention. We are all doing the best we can to ensure that this is an entirely positive experience for people.

The hon. Member for North Southwark and Bermondsey agreed that the strategy for England, which will be the second one, gives confidence, and stressed the importance of that confidence to the public at large. That is an important subject as we try to attract more and more people's attention towards considering microgeneration. I join him in that view and add the importance of giving confidence to those in the supply chain that provides microgeneration technology, be they manufacturers, sellers or installers. I am keen that we have a healthy supply chain with the confidence to invest in its business, its equipment and the skills of its work force because it knows that a lasting and sensible strategy is in place.

The hon. Gentleman is pleased that there are dates and deadlines. I suppose that as a Minister I should not be so pleased, but I assure him that I am determined to keep to them. I look forward to meeting them in future. He mentioned the loss of the definition of "green jobs" from the Bill and described the conceptual difficulty that people have with the term. I attended the launch yesterday of a document jointly produced by British Gas and the GMB trade union called "Green Collar Britain". That is a good way of looking at jobs in the environmental industry, as people can identify with the idea of green-collar jobs. We already have more than 800,000 jobs that exist because of trade in green goods and services, which is worth more than £107 billion a year to this country. As a country and as a Government, we want to capitalise on that success and create more jobs and more wealth in environmental industries.

The hon. Gentleman made a point about the capacity limits in the Bill. The hon. Member for Bexhill and Battle reminded us that there had been a teeny bit of confusion at one point in Committee about how the different definitions in the Energy Act 2004, earlier electricity legislation, and the Bill would mesh together. As he said, however, we have now established that they are perfectly compatible and mostly desirable.

In an ideal world for the Government, we would try to leave specific capacity limits out of primary legislation, because we never know how things will turn out in future. However, they started to appear in primary legislation back in the 1980s, and there were some in the 2004 Act, so we are where we are. I am pleased that we have established the relationship between the definition of green energy, the limits for future feed-in tariffs and what is meant by microgeneration, and we can all work with the limits that we have for the time being. I noticed the touchiness on the Liberal Democrat Benches about nuclear power, but for today we will pass quickly over that.

I agree with the hon. Member for North Southwark and Bermondsey about the language of fuel poverty. I am the Minister for tackling fuel poverty, and I am charged with a target of eradicating it in this country by 2016, which is an immense responsibility. I agree that the public might be more engaged with the debate if we talked more about warm homes. As a member of the all-party warm homes group I am familiar with that term, which is a positive one to engage people in dialogue about. I am with him on the importance of using that language.

I understand why hon. Members were disappointed to lose the points about council tax and non-domestic rates from the Bill. In Committee, my ministerial colleague gave a detailed explanation of why each was unattractive to the Government, and I have nothing to add to that. The hon. Gentleman asked me about fiscal measures, and I was also asked about future consultations on such measures. I am certainly willing to say that the Government keep all fiscal measures under review, and consultations are planned quite soon on feed-in tariffs, for example. There will be further discussions, and who knows, perhaps when I meet him and the hon. Member for East Surrey we can touch on that subject.

The hon. Member for Bexhill and Battle stressed the importance of energy efficiency. We all agree about that, which is why it is important that it appear in the Bill, as it does in the Government's thinking about how to improve our energy security and tackle fuel poverty. Like myself, he stresses the importance of giving people confidence to invest in the technologies in question, which is why long-term strategies and firm regulation that gives the market clear signals are very important for the future. Like him, I am pleased that we are making good headway on the subject of heat. He is right that although we have begun the march towards getting much more of our electricity from renewable energy, it will be a much longer march to decarbonise heat. That is an important priority for us.

The hon. Gentleman was keen to stress that we should make much more use of permitted development rights. That is a good point, subject to the warning from my right hon. Friend the Member for Holborn and St. Pancras that we should be considerate of our neighbours in this matter, as in every other, and that we should be wary of losing public support by going too far too quickly.

The hon. Member for Bexhill and Battle also asked me to confirm that we will consult on fiscal measures. I have given the example that there would soon be consultation on feed-in tariffs, and I am sure that each step of the way as we consider other fiscal measures, we will want to consult hon. Members and all the organisations that he mentioned.

I turn to my own contribution to the debate. Met Office projections demonstrate that changes that sound small, such as a 2° C global temperature rise, will actually have serious impacts on the whole world through rising sea levels and extreme events such as droughts, hurricanes and floods, leading to disruption— [Interruption.] Hon. Members really should pay attention. This is very serious stuff. It will lead to disruption to natural and man-made habitats. Many communities across the UK will struggle to cope with the effects of warmer summers and wetter winters. The resulting disruption to their homes and lives will be the physical consequences of doing nothing now, and of failing to get an international agreement at Copenhagen.

In the absence of effective international effort, greenhouse gas emissions will continue to grow rapidly over the coming decades. On current projections, that will result in warming of between 1.7° C and 4° C by 2100. Rising temperatures will cause a range of stresses to our planet, causing radical changes to rainfall patterns; water shortages; loss of glaciers; loss of agricultural land; and extreme weather events of increasing frequency. We have seen in the dramatic flooding in the UK in recent times, which caused social upheaval and severe economic effects in flooded towns all over the country, how easily such weather events cause chaos. We have also seen how much it costs to tackle and remedy them. Stern was undoubtedly right about the costs of not acting.

Those are some of the reasons why the Government and Parliament have committed to cutting greenhouse gas emissions by 80 per cent. by 2050. We are not suggesting that reaching that target will be easy. It will require radical action, and we will need to roll out cost-effective quick wins such as insulation. We will also need to decarbonise the supply of electricity and heat, which we cannot live without. The challenge is clear when we consider, for example, that space heating accounts for 47 per cent. of our overall carbon emissions. In that context, it is critical to encourage renewable heat technologies.

As hon. Members know, microgeneration technologies are varied. They can deliver both renewable electricity, through micro-wind, photovoltaics and micro-hydro generation, and renewable heat through heat pumps, biomass and hopefully in future micro fuel cells. Microgeneration can help us contribute towards our 2050 target of reducing our emissions by 80 per cent. It can also help communities and householders work together to tackle the damaging effects of climate change, and it has the potential to increase the diversity as well as the security of UK energy supplies. In many cases, fitting microgeneration will help us to be aware that we must use energy more efficiently.

In the shorter term, those technologies, some of which are mature already and some of which are still developing, have the potential to help us meet our EU 2020 targets on renewable energy. We all know that those are challenging targets, which require a significant increase in renewable generating capacity. Indeed, we will need no less than a tenfold increase in renewables, which is a very daunting prospect. Our recent domestic supplies of gas and oil have come from domestic sources, putting our starting point for renewables behind that of many other EU countries. That is one more reason for supporting the Bill, which represents a second push towards reaching the microgeneration levels that will make a serious contribution to our 2020 targets.

We have already put in place an energy strategy to generate a baseload from technologies such as nuclear power, and to develop carbon capture and storage. Last year, the Energy Act 2008 set the framework for moving forward to ensure that the market is capable of delivering the changes that we need now and in the future. However, it is important that householders, communities and businesses can also play their part effectively. We are therefore working on a smaller community and householder scale strategy, too.

When we talk about energy saving, we must fully consider the fact that about 80 per cent. of the housing that we see around us today will still be standing in 2050. Those buildings include many millions of homes that are today highly energy inefficient. Problems can range from the cost and difficulty of double-glazing old windows to the lack of flues in houses that were built for gas central heating.

It is deeply unfortunate that much of the most energy inefficient housing is in the most deprived areas of Britain. However, with a need to ensure that everyone can heat their homes when it matters, initiatives like Warm Front will continue to be important. Hon. Members may be pleased to learn that yesterday I signed the new regulations on Warm Front, which will permit some installation of microgeneration technologies through Warm Front grants for properties that are off the national gas grid.

The Government's forthcoming heat and energy saving strategy will try to tackle many of those issues. It will aim to support and encourage everyone—individuals, communities and the Government—to work together and make the changes needed in the fairest way possible.

We all know that homes and buildings currently use a lot of energy inefficiently. Wasting electricity on inefficient appliances and losing heat through poorly insulated walls and ceilings could cost the average household more than £300 a year. We are therefore looking at new delivery models and packages to provide whole house, house-by-house and street-by-street approaches, targeted particularly at the poorest communities. We are also considering ways of linking financial support to the property, rather than to the householder, so that subsequent house owners take on the overall costs, as they save money on their own energy bills. We will examine new measures to stimulate community-scale generation. Pilots of pay-as-you-save may be an important driver of the wider take-up of microgeneration technologies.

It is a sobering thought that about a quarter of all UK emissions come from the domestic homes sector. To meet our target of reducing emissions by 80 per cent. by 2050, we will have to eliminate emissions almost completely from households. That sounds like a tough ask, but when we consider how difficult it will be to hit those targets in other sectors, there is little option.

There are two separate but complementary ways of radically reducing domestic carbon emissions. The first is radically improving energy efficiency and the second includes looking at ways of generating energy more sustainably. That means that we need real growth in small-scale, low carbon and renewable energy technologies. Microgeneration will definitely have a key role to play, if we are to get where we want to be by 2020.

By brigading the concept of energy efficiency with renewable and low carbon sources under the broad definition of "green energy", the Bill enables us to promote their use at that smaller scale. We recognise that, to tackle climate change, each and every person needs to play their part. We need to make it easier for individual householders and businesses to install microgeneration equipment and increase the amount of green energy generated. That is exactly what permitted development rights do—they grant planning permission at a national level and remove the financial and administrative burden of submitting a planning application. The Government have already made progress on that and granted householders permitted development rights for technologies such as solar panels and ground source heat pumps. However, we also know that that we need to go further.

Micro wind turbines and air source heat pumps have a big role to play in contributing to the generation of green energy. The Bill recognises the Government's commitment to those technologies by ensuring that we will grant permitted development rights for them in a domestic setting in six months of the Act's coming into force.

However, home owners are not the only ones who can help. The potential for green energy generation on land occupied by farms and premises used for commercial purposes, such as offices, is huge. Our job is to grant permitted development rights that allow developments in the right place without adverse impacts on neighbours. Let us not pretend that that is easy—what is acceptable to one person is a nuisance to someone else. It is important to get the balance and the pace of change right.

The Bill commits us to consider introducing permitted development rights in a non-domestic setting in six months of the Act's coming into force. We have already started work on proposals, and we will produce a consultation paper later this summer.

Of course, those are not the Government's first steps on promoting microgeneration. I mentioned earlier that we have already had one microgeneration strategy, which was published in March 2006, and had the objective of creating the conditions for the technologies to become a realistic alternative or supplementary source of energy generation. Of the 25 actions that the strategy contained to tackle the barriers to widespread uptake of microgeneration, 21 were completed and three were closed. The only outstanding action was in relation to "deeming" under the renewables obligation. That is now covered by provisions in the Energy Act 2008 to introduce a feed-in tariff for small-scale electricity generators.

Work on the microgeneration strategy allowed us to benefit from a greater insight into how the market for microgeneration works and to understand better its potential as we move towards creating a low carbon economy. As I have already mentioned, relaxed planning from permitted developments, for example, will help communicate to a wider audience the real need to act on climate change now. By facilitating an easier process for installing microgeneration, it is to be hoped that schools will take a more active role in developing renewable and low carbon microgeneration projects, allowing children to gain valuable, practical knowledge about what they can do as contributors in a lifelong effort against dangerous climate change. The Building Schools for the Future programme gives immense scope for acting sooner rather than later in both primary and secondary schools.

While it is vital to engage readily with home owners, small businesses and community actors, we must ensure that future generations will be keen to act, able to judge what it is possible to deliver in homes and communities, and equipped with skills to use that knowledge positively.

Another key achievement of the microgeneration strategy was the introduction of the microgeneration certification scheme—MCS. I am pleased to say that it is making good progress, in terms of product and installer certification, with more than 310 installer companies certified. To bring down costs, we opened up the scheme to 14 new certification bodies, five of which—BRE, NAPIT, British Board of Agrément, NICEIC and Action Renewables—have already achieved accreditation from the United Kingdom Accreditation Service for MCS. In the next few weeks, they will be joined by EC Certification and TUV NEL. That is an excellent opportunity to build on what BRE has achieved, and a new microgeneration strategy will ensure that we continue to push forward with a robust certification process.

MCS will not only provide consumers with impartial certification of installer companies and products but offer enhanced consumer protection and a means to register complaints. Through MCS, consumers can have confidence that complaints will be dealt with effectively and faults corrected. The scheme will also ensure that consumers get accurate estimates of the likely performance of the largely unfamiliar energy technologies before they sign up to them.

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Photo of Gregory Barker Gregory Barker Shadow Minister (Energy and Climate Change)

That is all terribly interesting, but the Under-Secretary has been on his feet for nearly an hour. Will he assure us that he is reaching the conclusion of at least his opening remarks?

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Photo of David Kidney David Kidney Parliamentary Under-Secretary, Department for Energy and Climate Change

The hon. Gentleman is too cruel. I can assure him that we are almost there. I hope he will agree that certification is important for ensuring the greater use of microgeneration technologies and for the reassurance that it gives to the public about the standards that are set for them. Certification to robust standards is the key to delivering a sustainable industry in the UK. We have learned lessons from countries where negative media reports about installers over-promising energy outputs or about low-quality or even unsafe installations have scared off potential consumers, deeply damaging the wider microgeneration industry.

Confidence is key to moving forward. We recently convened a citizens' dialogue about how we will need to heat and power our homes and communities in the future—in other words, about how they will make the big energy shift. Participants from communities in England, Wales and Northern Ireland came together for that dialogue. It was clear from their questions that, as well as economic incentives to make microgeneration attractive, they want free, impartial and reliable advice before making investment decisions on such a scale.

People also want information about the support and services available to them. Last year, the Act on CO2 helpline was accessed by 1.5 million people and was able to point home owners towards the best and most cost-effective means of saving energy, and of course money, by raising awareness of the opportunities for energy efficiency products in the marketplace today. I am also informed that the Energy Saving Trust's online interactive diagnostic tool for microgeneration technologies is now live. It will allow consumers to enter details about their properties and get advice on which technology would be most suitable, and equally importantly, which would not. Information provision, support and skills are just some of the issues for consideration as work begins in earnest on the new microgeneration strategy required by the Bill.

As action elsewhere continues apace, we need to ensure that the financial support is available. The Government are working hard on two financial incentives that will have a genuine impact on pushing microgeneration into the forefront of our energy future. Our renewable heat incentive will be one of the world's first financial mechanisms to support the generation of renewable heat. As with feed-in tariffs, our aim is to make the renewable heat incentive as accessible, flexible and user friendly as possible to potential investors in renewable heat at all scales, from the domestic up to large industrial installations.

We are building the renewable heat incentive from scratch, as currently there is no physical or regulatory market for heat, so there is a lot of work ahead of us. The powers in the Energy Act 2008 are broad and allow maximum flexibility in designing the details of the incentive. That flexibility will allow us to work with all parts of the energy industry and other stakeholders to understand better any issues that could arise from implementing the mechanism. The details of the renewable heat incentive have not been finalised, but we will be consulting on these towards the end of the year. We aim to have the incentive in place by April 2011, and through it we expect to see a genuine impact on domestic heating technologies such as solar thermal, and air and ground source heat pumps.

That is one financial incentive. Feed-in tariffs will also act as a major incentive for the development of small-scale electricity generation. We are committed to having them in place by April 2010. The tariffs are intended to be a simple, easy-to-understand mechanism to provide certainty of reward to make small-scale low-carbon electricity generation a more economically attractive proposition to anyone wishing to invest in it. We will consult on the feed-in tariffs this summer, alongside a consultation on changes to the renewables obligation. There is much work yet to be done. My Department will look particularly at lessons learned from abroad where similar schemes have already been introduced.

At this moment, I am unable to say what the levels of the feed-in tariffs reward will be, as they may differ for different technologies and may depend on the size of the installation and the initial cost to buy equipment. Such features can be decided only following further analysis and the consultation that I have described. However, there is no doubt that they will offer the opportunity to draw small-scale generation fully into the mainstream. By not restricting such incentives to the domestic sector, we hope to allow for plant of a size used for community-scale generation. That includes buildings such as schools and hospitals, and small businesses. We wish to open up the opportunities offered by small-scale energy generation to all who can benefit from installing such technologies.

Another support mechanism to encourage take-up of microgeneration is the low carbon buildings programme, which I mentioned earlier. The programme has delivered very successfully, not only by helping to create the first microgeneration capacity in the UK, but by helping to create the supply chain needed to support the introduction of feed-in tariffs and the renewable heat incentive. In light of that ongoing success, in this year's Budget the Chancellor announced a further £45 million of funding for the low carbon buildings programme. That additional £45 million will help to avoid a potential gap in funding before the new incentives are put in place and will bring the total level of support through the programme to more than £130 million.

On Wednesday of this week, phase 2 of the extended programme for the low carbon buildings programme opened to new applications. We have introduced a pot for solar PV of £9 million, bringing the total budget committed to solar PV through phase 2 to more than £40 million. The remaining budget will support a wide range of technologies. We want to provide support for the heat technologies through to the intended start of the renewable heat incentive in April 2011. That is excellent news for microgeneration technologies and demonstrates the Government's commitment to helping microgeneration move to a sustainable position.

I want to emphasise that there is already a great deal of activity to support microgeneration. Over the past few years, we have begun to develop the tools with which to tackle the energy challenge ahead on the small scale. As a consequence, it is now time to draw on the lessons that we have already learned and build on the successes of the first microgeneration strategy. In order further to promote the use of renewable and low carbon sources, the Green Energy (Definition and Promotion) Bill provides us with the opportunity to consult on, and thereafter publish, a new microgeneration strategy, which will take us into the coming decade. That will be critical in giving greater certainty to industry and the microgeneration sector. Although the new strategy will be applicable only to England, I am sure that the devolved Administrations will join us in our commitment to deliver a prosperous future for microgeneration throughout the UK.

I am pleased to draw my comments to a close. I know that there is already much support for the Bill. I am sure that it is about to receive its Third Reading in this House, before passing to the other place, where I wish it equally great success and approval and, given what we said earlier about the shortness of time there, a speedy passage on to the statute book.

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Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey 11:47 am, 3rd July 2009

May I thank the Minister for his exhaustive speech? By the time he reached his "live diagnostic tool", I think that even he was losing the will to live. However, the other place will notice the thoroughness of his remarks, which will no doubt be helpful when it considers this legislation.

I thank all right hon. and hon. Members who have contributed to what was, until the last hour and a bit, a fascinating debate. I apologise to the citizens of Bexhill and Battle for an unwarranted slur on their character. I did not mean to single them out: they are no more nor less selfish chimpanzees than the rest of the human race. Finally, may I again implore the Government to do all that they can to ensure that the other place expedites its consideration of the Bill? Otherwise all our labours will have been in vain.

Question put and agreed to.

Bill accordingly read the Third time and passed.

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