Renewable Energy Infrastructure

Energy and Climate Change – in the House of Commons at 10:30 am on 7th July 2011.

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Photo of Nicola Blackwood Nicola Blackwood Conservative, Oxford West and Abingdon 10:30 am, 7th July 2011

What recent assessment he has made of the incentives available for investment in renewable energy infrastructure.

Photo of Nicky Morgan Nicky Morgan Conservative, Loughborough

What recent assessment he has made of the incentives available for investment in renewable energy infrastructure.

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

The current financial mechanisms to incentivise renewable electricity are the renewables obligation and the feed-in tariff scheme. We are currently undertaking reviews of the RO banding and the FIT scheme, and the renewable heat incentive is due to go ahead this year. The Government have also set aside up to £60 million of direct support for the development of offshore wind manufacturing at port sites in English assisted areas.

Photo of Nicola Blackwood Nicola Blackwood Conservative, Oxford West and Abingdon

There are some fantastic community-led renewable projects in my constituency, including Oncore—Oxford North Community Renewables—which is a project to build solar panels on Cherwell school in north Oxford. However, despite the fact that we all recognise that such projects are vital to our efforts to reduce our reliance on fossil fuels, they often struggle to raise sustainable funds. Will the Secretary of State tell me how he expects projects such as the green investment bank to help support community renewables projects such as these?

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

Access to finance is clearly a major issue for projects such as those in my hon. Friend’s constituency, and the green investment bank will certainly play a role eventually. Our FIT scheme reforms have focused on ensuring that money goes to community schemes rather than City speculators. The banks are increasingly taking a favourable attitude to this matter and finance is increasingly available from the high street banks. I am pleased therefore to confirm that yesterday the Treasury opened a consultation on the provision of other finance and on ensuring that enterprise investment schemes and venture capital trusts investing in FIT schemes through community-interest companies, co-operative societies and community benefit societies continue to qualify for improved support, as will those generating electricity from micro-hydro schemes. I hope that this change will focus investment on schemes that benefit local communities.

Photo of Nicky Morgan Nicky Morgan Conservative, Loughborough

I have written previously to the Secretary of State on behalf of Evance, a manufacturer of small wind turbines in my constituency. One of the main issues it has raised has been the need for clear guidance for planners on how to deal with small wind systems. Will he tell me what discussions he and his ministerial colleagues have had with the Department for Communities and Local Government on this issue? In particular, would any guidance include specification of acceptable noise levels for these small—less than 50 kW—wind systems?

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

I am grateful to my hon. Friend for raising this important issue. It is a matter for DCLG, as she implied, although I have discussed it with that Department, and I expect an announcement shortly that I hope will indicate that some progress has been made.

Photo of David Hanson David Hanson Shadow Minister (Treasury)

Will the Secretary of State tell us precisely what percentage of the respondents to the recent FIT consultation supported the Government’s view? What assessment has he made of the impact of the review on manufacturers such as Kingspan in Hollywell in my constituency and Sharp in Wrexham, which he visited and lauded but has now pulled the rug from under?

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

I respect the right hon. Gentleman for standing up for his constituency—I would expect nothing less—but the responses to the FIT consultation were not as binary as he suggests. People did not give yes or no answers. We had to take a decision on the FIT programme for a simple reason, which was that, unfortunately, the planning that went into the announcement assumed that there would be no large-scale solar projects for three years. If the right hon. Gentleman, who was a Minister in the previous Government—as I well remember—is prepared to take responsibility for those assumptions, I would be very pleased, but sadly I am not. We have had to amend those assumptions and ensure that we have an affordable scheme that can provide steady growth—

Photo of Gloria De Piero Gloria De Piero Shadow Minister (Culture, Media and Sport)

Underground heat pumps and solar panels will become a fact of life for us all in the not-so-distant future. What are the Government doing to help areas such as mine—former coalfield areas—to play a part in manufacturing these things so that once again we can power Britain and the world?

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

We have seen enormous growth in low-carbon goods and services. In fact, the sector now employs 910,000 people across the UK economy so it is no longer a cottage industry—it is serious stuff. In relation to the green deal, particularly some of the kit being manufactured for it, we are in discussions with manufacturers to try to ensure that they are thinking about the scale on which the green deal will operate, because obviously if the market is relatively small, there will not be the economies of scale that can get prices down and the opportunities up. I am determined—

Photo of Andrew George Andrew George Liberal Democrat, St Ives

My right hon. Friend mentioned the review of the renewables obligation certificates. He will be aware of the great opportunity presented by the wave hub project located off the north coast of my constituency. In respect of the review, however, what reassurances can he give me and the House that there will be an even playing field north and south of the Scottish border?

Photo of Christopher Huhne Christopher Huhne Liberal Democrat, Eastleigh

The devolved Administration—the Scottish Government—have the ability to vary ROC support somewhat, which they do in the case of advanced marine renewables. We are determined on both sides of the border to see progress on those technologies, because they have enormous potential in the years to come, and I am sure that there is enough to satisfy those both south and north of the border.