Low-carbon Electricity Projects

Energy and Climate Change – in the House of Commons at 9:30 am on 19th June 2014.

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Photo of Julian Huppert Julian Huppert Liberal Democrat, Cambridge 9:30 am, 19th June 2014

What progress he has made in increasing investment in low-carbon electricity projects.

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills , Minister of State, Department of Energy and Climate Change, Minister of State for Portsmouth

We estimate that nearly £29 billion has been invested in renewable electricity generation projects in Britain since 2010, and the Energy Act 2013 provides the framework for an increase in that investment. Last month we signed investment contracts, an early form of contract for difference, for eight projects: five offshore wind farms, two coal-to-biomass conversions, and one dedicated biomass plant.

Photo of Julian Huppert Julian Huppert Liberal Democrat, Cambridge

According to Bloomberg, there was a 59% increase in finance for new renewables in the last year, making a total of £7.3 billion. Just in the last couple of days the East Anglia ONE scheme was approved, which will power 820,000 homes using clean energy.

What will the Government and Minister do to extend this success and to tell people about our great success in renewables?

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills , Minister of State, Department of Energy and Climate Change, Minister of State for Portsmouth

I think my hon. Friend has almost just done that, and I confirm that the Bloomberg analysis shows that investment has doubled during this Parliament. It increased by 20% last year at a time when it was falling in Germany. We now have the largest amount of offshore wind installed anywhere in the world. Two of the biggest wind farms in the world were opened last year. I know my hon. Friend welcomes the East Anglia ONE approval given this week, which will power over 800,000 homes, and more projects are coming on stream this year.

Photo of Alan Whitehead Alan Whitehead Labour, Southampton, Test

Has the Minister made any assessment of the support costs for the procurement of low-carbon capacity such as field solar and biomass compared with the support costs for securing high-carbon capacity, such as gas, through the capacity auction mechanism?

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills , Minister of State, Department of Energy and Climate Change, Minister of State for Portsmouth

Of course, we look at the different costs of the different technologies all the time, and we have to make sure all those costs are manageable within the levy control framework and within the figures that we have set out right through to 2020.

Photo of Duncan Hames Duncan Hames Liberal Democrat, Chippenham

I note the progress the Minister cites in agreeing contracts for difference for biomass and offshore wind. Is the Department negotiating contracts for difference for any other renewable energy technologies?

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills , Minister of State, Department of Energy and Climate Change, Minister of State for Portsmouth

There are already investment projects proceeding in a range of different technologies. We have some 120 renewable projects under way which are not limited to offshore or onshore wind, but include solar, biomass, dedicated biomass with combined heat and power, and some of the other renewable technologies.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

May I press the Minister on this? If we want to improve innovation in this sector, is not the real problem that we are not getting down to small and medium-sized enterprises enough, and is not one way of doing that through having good partnerships involving universities? Could we stimulate local enterprise partnerships and universities to do more in partnership to move this on?

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills , Minister of State, Department of Energy and Climate Change, Minister of State for Portsmouth

A number of the LEPs have put forward energy-related projects in the strategic growth plans that we are considering at the moment, and which we hope to finalise and announce early next month. In addition, there is the community energy strategy that encourages precisely that kind of work, and I look forward to visiting the university of Sheffield tomorrow morning to see the research that it is doing on carbon capture and storage.