Climate Change Levy: Nuclear Power

– in the House of Lords at 2:44 pm on 6th January 2004.

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Photo of Lord Peyton of Yeovil Lord Peyton of Yeovil Conservative 2:44 pm, 6th January 2004

asked Her Majesty's Government:

Whether, to assist in meeting their Kyoto undertakings, they will relieve nuclear power stations from payment of the climate change levy.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

No, my Lords; the Government have no plans to relieve nuclear power stations from the levy. While nuclear power does not generate CO 2 emissions, it does have other significant environmental impacts, and it is right that those are acknowledged.

Photo of Lord Peyton of Yeovil Lord Peyton of Yeovil Conservative

My Lords, I feel almost crushed by disappointment at the foolishness of that Answer. The Government have declared themselves in favour of reducing carbon emissions. One field of generation that is absolutely innocent of producing such emissions is the nuclear field. Will the noble Lord do himself a good turn, and ask his colleagues to do themselves a good turn, and reread the report Towards a Non-Carbon Fuel Economy published in April by the House of Commons Select Committee on Science and Technology, which was chaired by one of their own Members? It is a very intelligent report. It says that renewables are much too slow in coming on stream and that there will be a gap which must be filled by nuclear power. The Government will look very shameful; they ought to be thoroughly ashamed now of their failure to take this matter seriously.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, I am really worried by the degree of emotion which the noble Lord, Lord Peyton, gives to his responses to my answers. His Question and my Answer were about the climate change levy. Of course there are wider issues raised in the Select Committee report, but, of itself, exempting nuclear power from the climate change levy would not actually help. What we have to do is to reduce energy use in total. We are dealing with that through many policies, including enhanced capital allowances and encouraging generation from new renewables. I agree with him that progress on that is in many respects too slow. However, it would not help to exempt nuclear power from the climate change levy.

Photo of Lord Tomlinson Lord Tomlinson Labour

My Lords, perhaps I may therefore ask my noble friend to pursue the logic of his own argument and say that, until we have actually reduced energy consumption and have the alternative energy sources on stream, the Government see a vital role for the continuation of the nuclear generation of electricity so that we have the energy resources to fuel our manufacturing industry and our domestic and other needs.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, that is why the energy White Paper and the Energy Bill—which is soon to be debated in this House—deal with these matters. It is certainly true, as we have said on many occasions, that we have to keep options open for the continuation of nuclear energy beyond the life of the existing power stations. However, that is not affected by the climate change levy, which was the subject of this Question.

Photo of Lord Ezra Lord Ezra Liberal Democrat

My Lords, bearing in mind the lower than planned contribution from renewables and the fact that power stations have resumed adding to emissions, which is a serious situation, what further measures do the Government contemplate to achieve their Kyoto objectives, in addition to those already mentioned by the noble Lord?

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, that is very much wider than the Question on the climate change levy. I do not know whether the noble Lord, Lord Ezra, will be encouraged by my statement that, for the first time, in 2002 carbon emissions actually declined by 3.5 per cent, and in the climate change levy sectors there was a reduction of 13.5 million tonnes of carbon emission, which was three times the target planned. However, if he wants to ask questions on the wider issues of renewables and progress towards renewables, I am sure my colleagues from the Department of Trade and Industry will be happy to answer them.

Photo of Baroness Miller of Hendon Baroness Miller of Hendon Conservative

My Lords, can the Minister help us? Since nuclear power stations do not produce greenhouse gases, and since the Government keep repeating—as indeed the Minister stated today—that they are keeping the nuclear option open, can he tell us what consultations or deliberations on this matter the Government are currently engaged in, with whom, and how soon a decision may be made?

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, we are in constant negotiations, as we have to be, with British Energy because it is struggling very hard to keep out of administration. Therefore, the future of the nuclear power industry in this country is of constant concern to a number of government departments. But that does not mean to say that we are simply neglecting these issues. It is clear that that is not the case.

Photo of Lord Lea of Crondall Lord Lea of Crondall Labour

My Lords, does my noble friend agree that right from the start it was somewhat anomalous that the climate change levy rebate did not embrace nuclear? The Question on the Order Paper tries to relate the climate change levy rebate to the purposes of Kyoto. Kyoto was essentially concerned with carbon dioxide. Therefore, the climate change levy rebate should embrace it.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, we ought to be clear what the climate change levy is. It is a levy only on the business use of energy. It is designed to be revenue neutral; in other words, employers are compensated through reductions in national insurance contributions. Through the discount system for heavy energy users it is also neutral as between manufacturing and service industries. It is not meant to be the one magical cure for all of the problems in respect of carbon emissions.

Photo of Lord Marlesford Lord Marlesford Conservative

My Lords, does the Minister recognise that nuclear power can be regarded in practice as a renewable? When he talks about the environmental impact of nuclear power does he recognise that, for example, wind power has a huge environmental impact through its visual intrusion? Does he further recognise that to produce the equivalent output of one nuclear power station, say, Sizewell B, which produces 1,200 megawatts, you would need 600, 300-foot high wind turbines, which would cause huge environmental degradation to the landscape?

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, I am well aware that there is a great deal of controversy about some forms of renewable energy and certainly that there is controversy about the use of on-land wind energy and the environmental impact of that. Those matters can be debated at the appropriate time, not during discussion on a Question about the climate change levy. However, the definition of renewables is not up to us to decide. It is sometimes nonsensical, as with methane, but there it is, that is what renewables are and we cannot change the English language.

Photo of Baroness O'Cathain Baroness O'Cathain Conservative

My Lords, will the Minister expand on his comment about the Energy Bill that will be debated in this House? I got the impression from his answer to one of the questions that the nuclear option would be debated. That is news to me. Will the Government introduce an amendment to the Energy Bill before we see it?

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Parliamentary Under-Secretary, Department for Culture, Media & Sport, Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Media and Heritage)

My Lords, my supplementary answer referred back to my first Answer which concerned the environmental impacts of nuclear power. That, of course, is one of the issues in the Energy Bill.