Energy Bill [HL]

– in the House of Lords at 2:49 pm on 1 April 2004.

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Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips) 2:49, 1 April 2004

My Lords, on behalf of my noble friend Lord Whitty, I beg to move that the Bill be now further considered on Report.

Moved, That the Bill be further considered on Report.—(Lord Triesman.)

On Question, Motion agreed to.

Debate resumed, after Clause 157, on Amendment No. 217H.

[Amendment No. 217L, as an amendment to Amendment No. 217H, not moved.]

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

My Lords, in the debate on Report on 30 March I said all that needed to be said about Amendment No. 217H. Two amendments were made to Amendment No. 217H on that occasion. I have already moved the amendment.

On Question, Amendment No. 217H, as amended, agreed to.

Clause 158 [Payments of sums raised by fossil fuel levy]:

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

moved Amendment No. 218:

Page 122, line 16, leave out from "question" to "and" in line 18.

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

My Lords, Clause 158 enables Scottish Ministers to make use of the Scottish Fossil Fuel Levy surplus to promote the use of renewables in Scotland. Subsection (3) as currently drafted provides that Scottish Ministers, in making budget proposals to Parliament in respect of the surplus, should subtract any amount that has already been spent in the year in question. However, since the budget proposals were made to Parliament before the start of the financial year in question, that subtraction becomes redundant. Amendment No. 218 simply tidies up Clause 158(3) by removing an unnecessary calculation. It is a simple amendment for that simple purpose. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs

moved Amendment No. 218A:

After Clause 158, insert the following new clause—


(1) The Sustainable Energy Act 2003 (c. 30) shall be amended as follows.

(2) In section 7 (use of certain money held by Gas and Electricity Markets Authority)—

(a) In subsection (2) omit from "total" to end of subsection and substitute with "amounts directed each year to be paid under this section shall be divided between Renewable Energy projects and Energy Advice and Demonstration Centres."

(b) After subsection (2) there is inserted—

"(2A) Subsection 2 shall apply for six years following commencement of this section, after which the matter will be subject to review by Parliament.""

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs

My Lords, I notice that the Minister has made a small adjustment to the clause that is of interest to us. The amendments that I have brought back in a different form from those proposed in Grand Committee address the issue of the moneys raised from the non-fossil fuel obligation contract. When we discussed this in Grand Committee we learned, first, that the total amount in the pot was £122 million, of which the Sustainable Energy Act 2003 has made provision for up to £60 million to be spent on renewable energy projects. It remained unclear from the Minister's reply how the rest, given that it is now the greater part of that amount, would be spent.

As we have a large amount of money, either doing nothing or about to be redeemed by the Treasury, and, particularly, given that in between our consideration in Grand Committee and on Report the results of the Powergen survey were released—they showed that 86 per cent of consumers were aware of the environmental impact of CO2 but that only 39 per cent were ready to change their domestic energy decisions—it is clear that a large number of people need much more help with making practical decisions on saving energy.

In addition, since Grand Committee, there has been a debate in this House and a television programme which showed that we should be worried about the energy gap. For those reasons I have decided to combine the surplus moneys that the Government have not allocated from the non-fossil fuels obligation contract with the need for energy advice and demonstration centres, so that there is easily accessible, practical advice on what people can do in their homes to save energy and invest in new technology—such as microgeneration—which, as a result of amendments in your Lordships' House we now have on the face of the Bill. My amendment proposes that easy access to much more than Internet advice, which is all that is available now, needs to be provided in the high streets of towns with a population of more than 40,000—not every high street in every village and small town can have an energy advice centre.

In Grand Committee we observed that the Energy Saving Trust offers admirable advice as do the power suppliers, to some extent. However, that advice is not comprehensive, it is not available on the high street and is not readily available beyond the Internet.

The noble Lord, Lord Triesman, when he replied on 1 March, said, at col. GC 198, that he could not accept the amendment in that form and that, in any event, legal advice was that the provisions of the Sustainable Energy Act do not permit the use of further moneys beyond the purposes that are specified. Therefore, my current amendment seeks to free up the purposes of the money in that pot, as long as it achieves the Government's ultimate aim, which is the reduction of CO2 emissions. Rather than always concentrating on the means of achieving, as the Government have done—perhaps they have been further complicated—I am interested in the end result. The success of that end result is largely dependent upon consumers. If they are unable to access sufficient advice regarding the availability of technology and how that might be applied in their own homes, given that most people do not live in newly built homes, the Government have no hope of achieving what we need—a dramatic reduction in CO2 emissions. Therefore, I beg to move.

Photo of Lord Ezra Lord Ezra Shadow Minister, Trade & Industry

My Lords, I have no hesitation in supporting my noble friend's amendment, particularly as it is an essential part of the Government's energy policy that there should be energy saving in the home. If there are no advice and demonstration centres of the type that she has recommended, how can people be properly advised, given that the old gas and electricity showrooms have nearly all disappeared and that there are now no major centres where people can be informed about energy saving? Independent arrangements that could be financed out of the funds that are now available would be an important part of the Government's plan to improve energy efficiency in the home, on which they are shortly due to be producing a report. If it does not include advice and demonstration centres, it could, in my opinion, be extremely deficient.

Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative 3:00, 1 April 2004

My Lords, there is a great deal to be said for the amendment. Now that most appliances are bought otherwise than through electricity or gas showrooms—for example, department and cut-price stores—it is difficult for people to obtain the information they need. They may buy a new washing machine and ask, "How can I be sure that it will use less energy?". The message is slowly getting across that there is a great need to reduce energy consumption.

I welcome what the noble Baroness said about keeping one's eye on the main ball, which is the reduction of carbon dioxide emissions. As I have said several times during proceedings on the Bill—and it is good to hear it from the noble Baroness—the Government need to pay more attention to the objective of the exercise, which is to reduce CO2 emissions, than on the number of windmills to be erected.

I want to ask the Minister the same question I asked in Grand Committee. If the fund is to be available in the terms of the amendment for renewable energy projects as well as for advice centres, is there not a case for it being available as a last resort if the hole in the buy-out fund cannot be filled in any other way? It has been accepted by all that the buy-out fund is deficient because of the insolvency of firms which need to contribute to it so that the money can be distributed as subsidy for the renewable fund. Therefore, in the interests of promoting renewable energy, the fund should be available for that purpose.

We have not yet had the Government's final answer on how the problems relating to that will be dealt with. We have had various amendments to the Bill and they have been welcomed as far as they go. However, the Government have not found a way of filling the hole. To have the fund available for such a purpose would ensure that those investing in new renewable energy projects will receive the payments which they believed they would receive when they embarked on the investment.

The fact that there was a hole in the fund has reduced the ROC payments, and that has not been resolved. Why cannot this fund be used for that purpose?

Photo of Baroness Byford Baroness Byford Conservative

My Lords, I thank the noble Baroness for tabling the amendment. I referred to the demonstration centres at Second Reading and I still believe that they have a valuable role to play. However, I am sure that the noble Baroness will be disappointed to hear me say that the amendment as it stands is too specific. I would rather it had been wider, but the noble Baroness can return to the matter at a later stage.

I apologise to noble Lords that I was not present in the Chamber when today's debate began. I was in my office when suddenly the business collapsed. I have not come down the stairs so quickly in a long time and now nearly all my energy is used up.

I have great sympathy with the need and drive to save energy. We have shared that objective during the passage of this Bill and the waste and water Bills. The noble Lord, Lord Whitty, is not in his place, but I believe that the noble Lord, Lord Triesman, is getting the impression that whenever we take Bills through the House we want to try to conserve the precious gifts that we have—in this case, water.

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs

My Lords, I thank the noble Baroness for giving way. I apologise if in introducing the amendment I did not sufficiently express the fact that I do not intend that the surplus money should go only into energy advice centres. It should be divided between renewable energy projects and such advice and demonstration centres. I wonder whether on that basis she feels more inclined to support it.

Photo of Baroness Byford Baroness Byford Conservative

My Lords, I had read the amendment and that was the conclusion to which I had come. I am pleased that the noble Baroness has clarified the position with other Members of the House.

Like my noble friend Lord Jenkin, I firmly believe that the energy gap is real and that in some ways moneys will be made available to us. It is a missed opportunity if we do not encourage people to realise that there are other ways of using energy efficiently. In theory, I support that, but even accepting what the noble Baroness said, I have reservations about the amendment. However, that does not stop me supporting the sentiments which lie behind it and adding weight to them.

I want to pose two questions. It was suggested that the current position is not comprehensively spread. In other words, the ways in which we inform the general public are not sufficiently strong. First, if that is so, do the Government have any thoughts on how they could be improved? Secondly, if the money is not to be used to facilitate that, what is it to be used for?

Photo of Lord Davies of Oldham Lord Davies of Oldham Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, I am grateful to the noble Baroness, Lady Miller, for introducing the amendment. She will recognise that the Government have considerable sympathy with the objectives for which she is striving. I recognise support in other parts of the House for the amendment.

Let me make it clear that we have only recently legislated, through the Sustainable Energy Act, on the use of £60 million of the England and Wales fossil fuel levy surplus, which is the subject of the amendment. We allocated that £60 million for the promotion of energy from renewable sources. This meets the commitment the Government made in the Energy White Paper to increase funding for renewables capital grants by a further £60 million. The noble Baroness will therefore see that it is difficult for us to accept the amendment because we have already allocated a substantial part of the sums and are largely fulfilling her broad objectives in the amendment.

We appreciate fully the value of local centres advising on energy efficiency. The burden of the noble Baroness's remarks and those of the noble Lord, Lord Ezra, was the importance of spreading among householders an understanding of the way in which they can make a contribution to the advancement of energy efficiency.

The Government already fund the Energy Saving Trust to manage a network of energy efficiency advice centres. There are already 52 such centres throughout the United Kingdom—44 in England, Wales and Northern Ireland and eight in Scotland. The centres provide free, impartial advice on energy efficiency to households. A number already receive funding from the DTI's renewable energy advice service in England and from the Scottish Executive in Scotland to provide advice on renewables.

The programme is a dynamic one because consideration is being given by both Defra and the Energy Saving Trust on how best the advice the centres provide may be extended. Defra is already discussing the way in which local sustainable energy advice centres may evolve to cover energy efficiency, renewable energy and transport.

We are also tackling energy efficiency in a range of ways. We went through many of these points in Committee but perhaps they bear elaboration at this stage. We have, for example, the Market Transformation Programme; Action Energy, run by the Carbon Trust; the Carbon Trust's Innovation Programme; and the Enhanced Capital Allowance Scheme, introduced by the Government in April 2002 as part of the climate change package, offering tax incentives to firms investing in an approved list of energy-saving technologies. In addition, we shall soon publish our combined heat and power strategy to 2010. I know that it will be of some comfort to the noble Lord, Lord Ezra, that the strategy will underline our belief, which we have sought to reiterate at various stages in the Bill, that combined heat and power has an important role to play in moving the UK towards a new energy-efficient economy. The noble Lord has constantly reminded the House of the importance of that. The support measures set out in the strategy will significantly help combined heat and power and will reaffirm the Government's commitment to their target of at least 10 gigawatts of installed good-quality CHP by 2010.

Similarly, we have demonstrated our commitment to renewables through our renewable energy policies and programmes and we continue to do so. The £60 million that I mentioned in my opening remarks is mainly for capital grants, which will help to drive forward renewables deployment. Some of the funding will be used to support offshore wind developments. These have an extremely important role to play in the achievement of our 10 per cent renewables electricity target by 2010. Thus, we shall obtain real added value for renewables from that additional funding.

In Committee, we explained extensively the fossil fuel levy. At present, the fund for England and Wales stands at £134 million, and there is now a £60 million limit on amounts that the Secretary of State can direct for use on renewables. I want to point out that no decisions have yet been taken on the use of the remainder of the fund in England and Wales, apart from the need to keep a £30 million reserve. Further additions to the fund from the future auctions of NFFO ROCs are expected, and consideration will be given to the use of future sums in the fossil fuel levy fund in due course.

The noble Lord, Lord Jenkin, asked—not for the first time in the House—whether some support could be given to the renewables obligation. We do not believe that we should take the steps he recommends to make good the shortfall. The renewables obligation is a market-driven mechanism. Any intervention by the Government in this way would be a direct intervention in the free market in relation to ROCs, and that might have serious consequential effects on the perspective which might develop in respect of the ROCs market. The noble Lord outlined with great force the gap which occurred some months ago and which caused real difficulties, as we recognised at the time. But we would be concerned about the precedent that would be set if the Government intervened in the way that he recommends with what would effectively be a direct subsidy. Therefore, I do not believe that that is a way forward.

I hope that the noble Baroness, Lady Byford, has been reassured that we are committed to making an extensive, geographically wide-ranging provision of energy efficiency advice. I emphasise that, out of the fund of £60 million, £30 million is to be held in reserve. There is a whole range of potential demands, but it will be recognised that the Government are at one with everyone who has spoken in this debate. We shall need to concentrate significant resources on providing support for, and understanding of, the role which renewables can play in the energy market if we are to hit the targets that we set for 2010. I hope that, with those reassurances, the noble Baroness, Lady Miller, will feel able to withdraw her amendment.

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs 3:15, 1 April 2004

My Lords, I thank noble Lords who have spoken in this debate: my noble friend Lord Ezra, the noble Lord, Lord Jenkin, and the noble Baroness, Lady Byford. I also thank the Minister for his reply. I agree that the DTI is already doing a considerable amount to change the potential for renewables and their development on the ground. However, the department is not doing enough to stem the increase in CO2 emissions that we have seen this year. Those emissions are no longer going down and this country is no longer meeting its Kyoto targets. This year, the emissions went up by 1.5 per cent. Therefore, I again emphasise that the key is to change consumer habits and consumer technology and to show people that they can have the same standard of living while using less energy.

I do not believe that that is an open-ended commitment: my amendment allows for the provision to take place over a six-year period. I believe that six years will be long enough for the energy advice and demonstration centres to have a considerable impact on everyone's energy consumption habits.

In his reply, the Minister referred to the 52 energy advice centres that already exist. I agree that they exist but I challenge anyone in your Lordships' House—perhaps with the exception of the Minister, who may have made an official visit—to tell me whether they have seen one and, if so, whether they have visited it. I notice that the Minister's noble friend is nodding but I do not notice any other noble Lord rising to his feet. Those advice centres are not obvious; they are hidden and, unless they are obvious and on the high street, they simply will not work.

The Minister also said that Defra is discussing how to encourage more local action. However, as the Minister knows, the bald fact is that, unless Defra has the resources to back that up, very little will result. My amendment proposes a simple mechanism by which that resource can be found.

The Minister has said a great deal about what the DTI is doing, but he has not said much about what the DTI planned to do but is no longer doing. I can give him the example of the Smart Metering Working Group which was set up in 2001. It recommended a pilot study of a completely different way of metering, which the DTI working group suggested would have a number of outcomes, including making consumers far more aware of the energy that they use. Deciding not to continue with such a study is regrettable. By now we might have had net metering, encouraging consumers to be aware of the energy that they use. I had in mind the fact that the DTI is not carrying out that kind of work when drafting the amendment. The Minister may or may not feel convinced by what the department is doing.

I appreciate that the noble Baroness, Lady Byford, does not feel that my amendment is perfect, but I hope, with the rise in CO2 emissions and the fact that action on the ground is failing in that respect, that she will feel the amendment is worth supporting. Therefore, I would like to test the opinion of the House.

On Question, Whether the said amendment (No. 218A) shall be agreed to?

Their Lordships divided: Contents, 44; Not-Contents, 102.

Division number 2 Private Parking: Ports and Trading Estates — Energy Bill [HL]

Aye: 42 Members of the House of Lords

No: 100 Members of the House of Lords

Aye: A-Z by last name


No: A-Z by last name


Resolved in the negative, and amendment disagreed to accordingly.

[Amendment No. 218B not moved.]

Photo of Lord Ezra Lord Ezra Shadow Minister, Trade & Industry 3:29, 1 April 2004

moved Amendment No. 218C:

After Clause 162, insert the following new clause—


The Authority shall with the passing of this Act, and in consultation with relevant agencies, review, and within six months publish its findings, of—

(a) the rules surrounding the disconnection of domestic premises from the supply of gas and electricity for debt in order to minimise the level of disconnections for debt;

(b) as far as is reasonably practicable disconnections in error;

(c) increase protection for vulnerable groups; and

(d) expand the definition of what constitutes a vulnerable group."

Photo of Lord Ezra Lord Ezra Shadow Minister, Trade & Industry

My Lords, Amendment No. 218C concerns gas and electricity disconnections. Currently disconnections run at the rate of 20,000 a year. In Grand Committee my noble friend Lady Miller of Chilthorne Domer and I tabled an amendment that would have ended the right of companies to disconnect in these circumstances because of all the social problems that can be created. None the less, for various reasons there was opposition to the move. However, it was agreed that the number of people being disconnected each year remained alarmingly high, as did the number of those cut off in error, and that something needed to be done about it.

Amendment No. 218C does not take away the right of energy companies to disconnect consumers for debt. Therefore, we had regard to the views expressed in Grand Committee. However, it ensures that the regulator Ofgem reviews the rules surrounding disconnections in order to minimise disconnections for debt and ends, as far as reasonably practical, disconnections in error. The amendment will also ensure that the regulator looks to increase protection for vulnerable groups in the disconnection process.

I was very pleased to receive a communication from the Energy Retail Association after the amendment had been tabled. It told me that it has assumed responsibility for the disconnection issues raised in the amendment. On behalf of the energy suppliers the Energy Retail Association is conducting a consultation to agree a definition of vulnerable groups that can be applied to all work streams designed to help vulnerable customers. Its intention is to work with government agencies, Energywatch, citizens advice bureaux and charities to identify how current billing and debt prevention procedures can link up with support offered by social services.

At the end of the exercise it hopes to have proposals for new processes and a list of early action to prevent disconnection that can be taken before the winter months. It states that it shares the aim to end all disconnections of vulnerable customers and believes that identifying them early and providing a range of support is the best way to achieve that.

I regard that as very valuable support for the proposals in the amendment. In those circumstances, I hope that we can give further support to the endeavours of the Energy Retail Association by agreeing to the amendment. I beg to move.

Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative

My Lords, everyone must have sympathy with the problems faced by households who find themselves with energy bills that, for one reason or another, they are unable to pay. The temptation is to argue that—the noble Lord, Lord Ezra, has not done so—if it is right to avoid disconnecting such households from the water supply for non-payment of debt, surely it is right to avoid disconnections in the case of energy.

The argument from the water industry is quite conclusive that when the law was changed and it was not allowed to switch off a person's water supply for non-payment of bills, bad debt rose in the sector by 17 per cent and debt recovery costs rose by 28 per cent. So, I am glad that this time around the amendment does not suggest that we should avoid disconnection.

However, one must look at the context. There is no doubt about it that the retail price of electricity is going to go up. Ofgem has warned us about that. All the pressures are now in that direction. People must become used to the fact that over the next few years power supplies to their homes and offices will become more expensive. I do not want to go over the ground of a previous debate, but that is much the best way to encourage people to save energy. To have energy that is artificially cheap is not a good incentive to save it. However, if electricity is going to become more expensive, as we are being warned that it will, the number of people on low incomes facing difficulties in paying their bills may well increase.

I have knocked about a bit in politics. My earliest memories of taking an active part—although not in the Palace of Westminster—were in relation to the Churchill government of 1951. That government came into office facing a very substantial bill for food subsidies inherited from their predecessors, the post-war Labour government. The argument was, "Well you cannot possibly cancel the food subsidies because that would be a great hardship to the people on the lowest incomes". R A Butler—later Lord Butler in this House—as Chancellor of the Exchequer, over a period of two or three years very skilfully phased out all the food subsidies and used much of the money saved to increase social security payments to the people who might otherwise have suffered.

Therefore, I argue in this case that if, indeed, there are categories of people who find paying their energy bills difficult, it makes no sense to keep the price down for all of us in order to protect them. The price for electricity and gas should be the proper economic price that produces a return for the companies that generate and the companies that transmit the supply. That has not happened in the past two or three years. The effect of the NETA—the new electricity trading arrangements—meant that prices were driven right down; several substantial generators were driven out of business; and the British Energy problem made life extremely difficult for the Government because they were unable to maintain their payments without government support.

It seems to me that the Government should now be looking to do what R A Butler did 50 years ago and recognise that we are going to face higher energy costs. It makes no sense to try to keep them down artificially and protect everybody. They should be looking at ways in which vulnerable households can be helped. That could be done through any number of channels in the social security network. I find it quite ridiculous that both my wife and I are going to get £100 to help to pay our community charge. Perhaps I may say that that is absolutely barmy. Why not concentrate that help on the people who really need it? The Government seem to be terrified of doing that. However, I am sure that it is the right answer for dealing with the issue.

I have difficulty with the last two paragraphs of the amendment, which contain the requirement to,

"increase protection for vulnerable groups; and . . . expand the definition".

The noble Lord, Lord Ezra, has been quite unspecific as to what that means. I certainly could not support an amendment with those very general and vague phases. There are other ways that vulnerable households could be helped. I hope I have said enough to indicate what I think they should be.

Photo of Lord Monson Lord Monson Crossbench

My Lords, although the amendment is obviously well intended, I suggest that the drafting is seriously flawed. Indeed, the noble Lord, Lord Jenkin of Roding, hinted at that in his closing remarks.

Paragraph (a) is essentially fine, although in order to avoid ambiguity it would be better if a comma were to be inserted after the word "debt" in that paragraph's second line. However, in order to make sense, paragraph (b) needs to be prefaced by a phrase such as "the number of", "the frequency of" or "the pattern of". Even more importantly, paragraphs (c) and (d) need to be prefaced by, for example, "ways to", so that they refer to,

"ways to increase protection for vulnerable groups; and . . . ways to expand the definition of what constitutes a vulnerable group".

This is not a question of being pedantic; the point is that if the clause is to be incorporated into the Bill, it will impose strict obligations upon the authority. The authority will not be able to fulfil those obligations unless they know precisely and unambiguously what they are.

Photo of Baroness Byford Baroness Byford Conservative

My Lords, I rise to echo the wise words of my noble friend Lord Jenkin of Roding. We all realise and accept that there are families that struggle to pay their bills. Let us agree that in the first place. When I read the amendment, I had picked up paragraph (d) as the one that was particularly worrying me. I will not add to what my noble friend has said, or go over it again. When the Minister responds, and the noble Lord moving this amendment responds, will they address the question of errors? Errors are made, and people are disconnected when they should not be. We perhaps need to have something in the Bill to address that. As it stands, I could not support the amendment fully. I highlight this issue, because it has not been addressed, and it should be.

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs

My Lords, I rise to support the amendment proposed by my noble friend Lord Ezra, to which my name is also attached. I accept that the drafting of our amendment is not perfect, for reasons that the noble Lord laid out when discussing paragraphs (b) and (c). However, the Conservative Benches found the last amendment too specific, but they find this amendment too general. They will obviously not be content with anything this afternoon.

The spirit of this amendment is extremely important. All that it is asking is that the authorities shall, with the passing of this Bill, and in consultation with the relevant agencies, review and publish their findings on disconnections. There are certainly some issues there. While this amendment may not be perfectly drafted, it is surely entirely reasonable. All it is asking is that the authority should review and publish its findings about what will be done to ensure that those who are classified as vulnerable groups are correctly classified, so that we are not leaving groups out of the classification who are vulnerable, and that the present rules and regulations with regard to those groups are reasonable. Surely, the publication of such a study would be in everyone's interests.

Photo of Lord Davies of Oldham Lord Davies of Oldham Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, we do not legislate in spirit, but in words. I am grateful to the noble Baroness for identifying that fact, and for supporting the burden of the remarks made by the noble Lord, Lord Monson, and the noble Baroness, Lady Byford, that there were conspicuous weaknesses in the amendment, which, if we sought to translate them into a law, would cause us real trouble.

This is an important debate, and I do not want it to look as though I am merely nitpicking about the text of the amendment when important issues are at stake. Lest noble Lords think that the Government come under pressure only when issues are debated in this House, with our combined wisdom, there is an Early-Day Motion in the other place signed by 100 Members of my party seeking far more dramatic action against disconnection—in fact, action against disconnection—whereas this amendment only expresses a general hope.

Let us not delude ourselves. What the noble Lord, Lord Ezra, did in introducing the amendment was highlight an issue that should, and does, concern us all. I assure the House that what the amendment seeks to achieve in the Bill is already being done. Ofgem already closely monitors disconnection activity. Where there are any unexpected trends in that activity, it seeks explanations. It has recently, with the encouragement of the DTI, been in extensive discussion with suppliers about all aspects of disconnection activity. These discussions are firmly in line with the expressions that have been made on all sides of the House today, and are also to be heard with some fervour in the other place. In particular, the discussions have focused on improved processes for identifying and dealing with vulnerable customers, and clarification of procedures for notifying relevant agencies where vulnerable customers were in payment difficulties. We expect this to lead to proposals for improved arrangements right across the industry, which will be the subject of consultation with key relevant bodies and the wider public.

The noble Lord, Lord Jenkin, mentioned water. He accurately identified the reason why water has significant consequences, when the issue of water disconnection came to the fore. Water is different from electricity and gas, because it is not just the consumer and the company that are affected by the disconnection of the utility. We all potentially suffer, in public health terms, if there is a suspension of water supply. Therefore, it fits into a different category, although the noble Lord has provided some help to the House in identifying what the consequences may be of pursuing a straightforward ban on disconnection. I emphasise that this short debate has highlighted a matter that greatly concerns the Government. It is clearly an issue that must be tackled.

When it comes to the general issue of support on fuel, it may be that we can go further down that road with regard to energy prices. The noble Lord, Lord Jenkin, did not mention the winter fuel allowance, but that perhaps was a slip. He did not recognise that some help is given with regard to increased prices and increased usage of fuel during the winter. I heard what he said about potential strategies with regard to energy prices, although that is a little remote from this amendment. Nevertheless, I hope that it will be recognised that the Government take the issues raised in this debate seriously. I hope that the noble Lord will see fit to withdraw the amendment.

Photo of Lord Ezra Lord Ezra Shadow Minister, Trade & Industry 3:45, 1 April 2004

My Lords, we have had an extremely useful debate on this important issue. Although a number of noble Lords have queried the wording of the amendment, I do not think that any have queried the motivation behind it. Reference has been made to the identification of vulnerable groups and to disconnections made in error. I am reassured by what the noble Lord, Lord Davies, said about the work already being done. I am also reassured that his colleagues in another place are being much more vigorous on this than we are, in our relatively tentative approach. I wish them every success in their endeavours.

It is satisfying to note that Ofgem, the Government, and other bodies are taking this extremely seriously. I have referred to the Energy Retail Association, which is also moving in this direction. I am satisfied that this matter is being taken seriously. I am glad that my amendment has led to this discussion, that there is a unanimous view that this issue must be taken with great concern, for the benefit of our compatriots who are not in a position to pay their bills for vital commodities, and that this is being looked at very carefully indeed. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Baroness Byford Baroness Byford Conservative

moved Amendment No. 219:

After Clause 167, insert the following new clause—


In this Act—

(a) all powers of exploration, exploitation, collection, transmission, distribution and connection to any other network shall be constrained by an overriding requirement to care for the natural environment;

(b) in this context the doing of anything that will cause, or causes, major lasting damage to the natural environment creates an offence; and

(c) an offence under this section will fall within section 77 of this Act."

Photo of Baroness Byford Baroness Byford Conservative

My Lords, I hesitate to rise and move the amendment standing in my name on the Order Paper, having been accused of not being able to be persuaded by the noble Baroness, Lady Miller of Chilthorne Domer, and the noble Lord, Lord Ezra. This amendment is hugely important. I accept that our wording might not be perfect, but I wanted to return to this issue.

In response to the amendments that I moved in Committee, the noble Lord, Lord Triesman, said:

"The amendments would not achieve their objective, as they propose introducing environmental considerations too early in the process, when the REZ is established".—[Official Report, 3/2/04; col. GC 320.]

I am trying again. As we know, environmental damage is of primary importance to our planet and the survival of its inhabitants. To say that it does not matter at a particular stage in a development rather misses the point. Exploration and the proving of reserve and geological structures can cause damage. It varies only in extent from operational damage.

Since we debated the issue in Committee, the House of Commons Environment, Food and Rural Affairs Select Committee has published its sixth report on the marine environment. It is hot off the press, having been published on 21 March. That is why I wanted particularly to refer to it. In the introduction of its report, the committee says that its predecessor, the Environment, Transport and Regional Affairs Committee, in a report on UK biodiversity, concluded that,

"the Government must address the range of problems and inadequacies in their approach to marine biodiversity. As an island nation, the conservation of marine biodiversity should be paramount and the Government should consider whether a new statutory agency is required to deal with marine biodiversity issues".

I raise that to provide background.

Item 10 on page seven, entitled "Lack of 'joined-up Government'", states:

"Although Defra takes the lead on marine conservation, other departments (including the Ministry of Defence, Office of the Deputy Prime Minister, Department for Transport, Department of Trade and Industry) are responsible for many of the activities that can affect the marine environment".

Item 12 on page eight is entitled:

"Lack of mechanisms to assess and manage cumulative impacts of different human activities at sea".

Under that heading, the report states:

"The consenting procedures for developments and activities at sea are generally handled on a sector-by-sector basis by the relevant sponsoring Department. Environmental groups express concern that the cumulative and 'in-combination' effects of industries such as oil and gas extraction, wind farms, coastal developments and fishing are not assessed under the present system".

Page 13 deals with the review of development in marine and coastal waters, for which the noble Lord, Lord Rooker, is the Minister responsible. The report concludes:

"The review has taken longer than expected to reach a conclusion, which has caused concern, but is due to report this year".

As I have said, we are considering the Bill now, not later in the year.

On page 20, paragraph 4 of the conclusions and recommendations states:

"At present, the different Departments involved do not appear to have a common approach to sustainable development in the marine environment and there is no formal arrangement allowing them to come together. Given the complexity of this area of policy, the Government should put in place a clearly defined co-ordinating mechanism to bring together, on a regular basis, the key parties with a role in protecting the marine environment".

The last extract that I wish to quote is paragraph 8 on page 21, dealing with the strategic environment assessment directive. It states:

"Wherever in Government the authority was based, it would need to ensure that the concerns of all users of the sea were taken into account".

During the passage of this Bill we have raised issues about fishing and protecting the seabed environment. This is my last chance to raise the issue again on Report. I am sure that the noble Lord, Lord Davies of Oldham, will not dismiss the issue, because we have talked about it at length. In some way, particularly as it has now been highlighted and supported by the recently published Select Committee report, there should be something in the Bill to deal with the issues raised.

We are concerned that the possible consequences of wind turbine construction at sea may be appreciated only after the damage becomes apparent, and that it may be some considerable time after it happens. Proposed paragraph (b) of my amendment refers clearly to,

"in this context the doing of anything that will cause . . . major lasting damaging".

We are trying to address lasting damage.

If developers know that they have a legal duty to avoid major lasting environmental damage, and that there is a penalty if they fail, they should build environmental protection into their plans from the very beginning. That is what we are trying to do. If there is no such provision in the Act then no case could be brought against those who did not take care of the environment, even if the effects are mostly hidden from all but a very few eyes.

If the Government cannot accept my amendment as drafted at this stage, I hope that they will give it serious consideration before Third Reading. I beg to move.

Photo of Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer Shadow Minister, Environment, Food & Rural Affairs

My Lords, throughout the Bill's passage I have expressed—particularly to the noble Lord, Lord Whitty, who is not in his place—what a pity it is that it was introduced before the Government had brought forward a marine Act. That would have laid the framework for marine spatial planning and protection. I believed that the Government intended to introduce such a Bill, but that has not been forthcoming. We now face development at sea without any planning framework or adequate protection.

I was, however, cheered to see that recently the Joint Nature Conservancy Council has made a substantial proposal for a pilot in the Irish Sea, which should result in the introduction of a marine Bill very soon. I urge the Government to keep a close eye on the pilot's progress.

As regards the amendment, the marine environment is critically important, as I have said throughout. However, my concern is that throughout the passage of the Bill Conservative Members have expressed considerable reservations about land-based and marine-based wind power in general. The amendment would place on wind-power developers an onus that does not apply to current producers of lasting damage. Notable among such producers is Sellafield, which recently withdrew from a position that until now has upset our Irish neighbours considerably—it had been continuing to release unacceptable levels of radioactive material that affected the marine environment.

Although I fully support action to protect the marine environment, it is against the context that I have outlined that I do not support the amendment. Although perhaps unintentionally, the amendment would adversely affect wind power developers. Those on the Conservative Benches agree that we need more renewable energy, and we should not try to undermine its development in this way.

Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative 4:00, 1 April 2004

My Lords, I am tempted to say that we have come nearly full circle with the noble Baroness's final remarks. She may remember that I opened my Second Reading speech with a description of the episode over which I had to preside as Secretary of State for the Environment relating to the discharge of radioactive material from Sellafield into the Irish Sea. I made the point that, in the past 30 years, discharges from that plant have been cut to about one thousandth of what they were at the beginning. I recognise what the noble Baroness says about the continuing complaints from the Irish Republic, but I am sure that I will have the Ministers with me when I say that they are almost wholly without foundation now.

I have one point to make about the amendment. If one reads the press and the correspondence columns and hears what is said, one can be in no doubt that there is growing opposition in this country to land-based wind farms. They are seen as unsightly and, if sited near local inhabitants, noisy. They are seen as a danger to wildlife, especially birds. For those and other reasons, such wind farms arouse a good deal of hostility. The Government say, "Don't worry. We are going out to sea. We will establish our renewable energy zones right out beyond territorial waters, where none of those things will apply". Lo and behold, what do we find? The Royal Society for the Protection of Birds becomes extremely concerned at the likely damage to bird life.

In her amendment, my noble friend has rightly pointed to the fact that this is yet another threat to the marine environment. By hanging their hat so firmly on their targets for wind power and turning away from the primary objective—the saving of carbon—the Government delude themselves and delude a declining number of members of the public. I am sure that they are beginning to realise that supporting the idea that our energy gap can be closed by a combination of wind power and energy saving is living with the fairies. It will not happen like that.

As my noble friend so eloquently said, when we are faced with the growing concern about the impact of wind farms and all the other things on the marine environment, the policy becomes hopelessly unbalanced. We have discussed those matters at some length during the Bill's passage, and I have no doubt that they will be discussed in another place. My noble friend has done us a valuable service in tabling the amendment to remind Ministers once again that there is an environmental cost with their policy of building wind farms on the Continental Shelf.

Photo of Lord Davies of Oldham Lord Davies of Oldham Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, I am grateful to all who participated in our short debate, particularly to the noble Baroness, Lady Byford, who moved the amendment. It is the last amendment before the Government's amendments, which, I trust, will not cause much controversy, so it is appropriate that our last debate should cover the broad issues with which the Bill is concerned. I can think of no amendment that has greater breadth. The noble Lord, Lord Jenkin of Roding, took us back to Second Reading: he could have taken us through Committee as well, when all the issues were discussed at considerable length.

I make the obvious point that, of course, we share the sentiments behind the amendment. If we did not share the sentiments behind an amendment requiring us to take care of the natural environment, why would the Bill be the kind of Bill that it is? It is concerned with reducing carbon emissions and encouraging the development of an electricity supply from more benign sources.

The noble Lord, Lord Jenkin of Roding, is right to remind us that nothing in this difficult world is cost-free. There are some environmental costs with any aspect of new development. I have not the slightest doubt that, if we were able to produce all the wind energy that we wanted from one turbine, the people who lived closest to that turbine would have identified for us the environmental costs to their neighbourhood. That is in the nature of such issues. We cannot have an entirely cost-free proposal, but it is clear that the development of energy in this way will go some way towards our broad objective of meeting the Kyoto targets and will be in line with our general position on energy generation. The inspiration behind the Kyoto targets is concern about the natural environment on the whole planet. We are all aware of the consequences of doing too little, too late in that regard.

The only powers in the Bill to which the amendment relates in practice are the powers that enable the development of renewable energy installations in the renewable energy zone. In Committee, we had a lengthy debate on the decision-making process concerned with giving developmental approval to renewable energy installations. We considered the importance of ensuring that the process gave proper and adequate consideration to the impact on the natural environment. We continued the debate earlier on Report, when we discussed some key amendments. Throughout those debates, the Government have sought to provide genuine reassurance that the decision-making process will ensure, through the incorporation of strategic environmental assessment and site-specific environmental impact assessments, that there is protection and concern for the natural environment. Our argument today is unchanged from those advanced by myself and, most forcefully, by my noble friend Lord Whitty, who, regrettably, is not present to produce a summation of the debate.

I remind the House of our need to recognise the bigger environmental picture. It goes beyond even the local marine environment and ecology, which is why we need to create the renewable energy zone. In developing renewable energy installations, we seek to achieve net environmental benefits by reducing our dependence on carbon-based fuels that not only deplete the planet's limited natural resources but, as we all know, pump damaging carbon into the atmosphere, a major factor in global warming.

I cannot do justice to all the issues raised in our short debate, but neither could the noble Baroness who moved the amendment or others who spoke. We are considering the broad, general issues that we all face with regard to protecting the natural environment. I emphasise that, obviously, substantial sections of the Bill are concerned with the natural environment and how we meet the necessary targets for protecting it and the health of the planet as a whole. I hope that, on that basis, the noble Baroness, having once again raised a very important issue, will be able to withdraw the amendment.

Photo of Baroness Byford Baroness Byford Conservative

My Lords, I am grateful to the Minister for that full response. I am not satisfied with his answer, and I think that he will understand that.

Before I return to the Minister's answer, I thank the noble Baroness, Lady Miller of Chilthorne Domer, for her overall support in our concern for marine protection. We agree on that issue. We too would like to find out from the Government what they are going to do in the long term. Will they publish a marine Bill? Perhaps, that is for another day.

I particularly thank my noble friend Lord Jenkin of Roding. He is right to point out that there is growing opposition to wind farms—not just to the wind farms themselves but to the fact that they will not produce what was initially hoped. It is certainly true that the RSPB has been in touch with us and, I suspect, other noble Lords, because of its concern about the deaths caused to wildlife, especially birds, on existing wind farms.

The noble Lord, Lord Davies of Oldham, said that I had not gone over the track to the full extent. I have borne his words of warning during our earlier days on Report in mind and made sure that I came back only with additional information, which he must have been pleased to have. That is why I find his answer very unsatisfactory. I wonder whether the officials who briefed him on the matter have read the report, because it was, as I said, published only on 21 March. His response to my questions did not deal with any of them. One thing that is clear from the report is that the present process is totally inadequate.

I feel strongly that the issue is important and will look carefully at what the Minister said. I am not prepared to put the matter to a vote at this stage, but I urge the Minister and his officials to have a good look at the report and my amendment to see whether they can come back with an amendment acceptable to the Government. I recognise that, in the short term, there may well be damage, as there is with other business conducted in the sea. We are trying to protect it from long-term damage.

For noble Lords who are quietly sitting listening to the debate, the Government acknowledged earlier on Report that some wind farms offshore could consist of 200 windmills. They are not one-offs; they are big areas. So it is all the more important that we get it right, which is what we are trying to do.

So I thank the Minister for his response. In particular, I thank my noble friend Lord Jenkin of Roding for his input. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 168 [Repeals]:

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

moved Amendment No. 220:

Page 131, line 26, leave out paragraph (b) and insert—

"( ) section 11(1) to (3) (provisions as to shares in BNFL and the Radiochemical Company).

( ) In section 11(4) of that Act (subscription for shares by the Secretary of State) for "either of the companies" substitute "the Nuclear Fuels Company".

( ) In section 12(1) of that Act (loans to BNFL and the Radiochemical Company), for "either of the companies" and "the company to which the loan is made" substitute, respectively, "the Nuclear Fuels Company"" and "that Company"."

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

My Lords, Amendments Nos. 220, 221, 225 and 226 are tidying provisions which have emerged recently. Noble Lords will appreciate that the legislative background of nuclear matters is long and complicated. Roughly speaking, there is about 30 years of legislation in this area and much of it is now redundant. This may be a case of redundant legislation decommissioning—an opportunity to correct some of those matters.

The amendments relate to Amersham plc, formerly known as the Radiochemical Company, and allow the Government to acquire shares in, and make loans and guarantees to, the company. Since the company was privatised in 1982, those powers are no longer necessary or appropriate. Having spotted those redundant provisions, we concluded that it was sensible to use the opportunity provided by the Bill to make this minor tidying up of the statute book. We have informed the company, which has no objection to our proposals.

This is the last of the amendments before we go through some formally. I was reflecting that there have been 11 days in Grand Committee, six days on Report and something in the order of 500 amendments and we still look forward to the joys of Third Reading. As this is the first substantial Bill which I have had the privilege of debating with your Lordships, may I observe that many have brought great wisdom from their long and distinguished careers to the debate. Others of us have simply come to the point of retirement during our lengthy deliberations. We are all, if a little older, somewhat wiser.

I thank noble Lords, including those who have disagreed so profoundly with us and especially the noble Baroness, Lady Miller of Hendon, who was not in her place today, but who has played such an important, leading role in the debate. I thank all noble Lords for the thoroughness of the attention brought to vital issues for the United Kingdom for its nuclear legacy and its possible nuclear future, which is not excluded, and to its obligations to the world environment through the promotion of renewables.

The amendment concerns a much smaller matter, one worth correcting. I beg to move.

Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative

My Lords, on behalf of my noble friend Lady Miller of Hendon, I am sure that she would very much appreciate the kind remarks of the noble Lord, Lord Triesman. In all parts of the House, we have been full of admiration for the way in which she handled a hugely complex Bill. It was extremely kind of the noble Lord, Lord Triesman, to say so. I must also say that the noble Lord has whetted my appetite: a redundant legislation decommissioning Bill? I cannot think of anything better. It would be a very fat Bill.

On Question, amendment agreed to.

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

moved Amendment Nos. 221 and 222:

Page 131, line 29, at end insert—

"( ) In section 11A(10) of the 1989 Act, in paragraph (b) of the definition of "relevant licence holder", the words "(by virtue of anything done under section 33(2) of the Utilities Act 2000)" shall cease to have effect." Page 131, line 29, at end insert—

"( ) In section 1(1) of the Nuclear Industry (Finance) Act 1977 (c. 7) (Government guarantees for BNFL and the Radiochemical Company), the words "or The Radiochemical Centre Limited ('T.R.C.L.')" shall cease to have effect.

( ) In subsection (1) of section 2 of that Act (financial limits)—

(a) for the words from "financial limits" to "B.N.F.L.," substitute "financial limit applicable to B.N.F.L. is";

(b) paragraph (b) and the word "and" immediately preceding it shall cease to have effect; and

(c) for "either company" substitute "the company".

( ) In subsection (2) of that section for "either of the two companies" substitute "B.N.F.L."."

On Question, amendments agreed to.

Schedule 23 [Repeals]:

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

moved Amendments Nos. 223 to 227:

Page 246, line 40, column 2, at beginning insert—

"Section 2(2)(d)."

Page 246, line 40, column 2, at end insert—

"In Schedule 1, paragraph 4."

Page 247, line 30, column 2, leave out "(3)" and insert "(1) to (3)" Page 247, line 35, at end insert—

"Nuclear Industry (Finance) Act 1977 (c. 7) In section 1(1), the words "or the Radiochemical Centre Limited ('T.R.C.L.')" and "concerned".
In section 2(1), paragraph (b) and the word "and" immediately preceding it."

Page 248, line 11, column 2, at end insert—

"In section 11A(10), in paragraph (b) of the definition of "relevant licence holder", the words "(by virtue of anything done under section 33(2) of the Utilities Act 2000)"."

On Question, amendments agreed to. Clause 169 [Short title, commencement and extent]:

Photo of Lord Triesman Lord Triesman Lords in Waiting (Whips)

moved Amendments Nos. 228 and 229:

Page 131, line 41, after "paragraphs" insert "A1,"

Page 131, line 42, after "4," insert "5A,"

On Question, amendments agreed to.