[Mr David Amess in the Chair] — Energy Supply

Part of the debate – in Westminster Hall at 2:30 pm on 6th September 2012.

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Photo of Tim Yeo Tim Yeo Chair, Energy and Climate Change Committee 2:30 pm, 6th September 2012

I, too, am grateful for that entirely unsolicited intervention from my colleague.

I also point out that I have been a strong and consistent advocate of greater investment in renewable energy for almost two decades—ever since I first took an interest in climate change when I was rather unexpectedly given ministerial responsibility for it in 1993. I believe that Britain needs investment in many forms of low-carbon technology, which of course includes nuclear power, and the suggestion that my views on the subject could possibly have been influenced by interests that I did not acquire until 2006 is simply absurd.

I warmly welcome the new Minister to his post. He comes in at a very challenging time in his Department’s history. We, as a Committee, look forward to working closely with him. We worked very closely with his predecessor, my hon. Friend Charles Hendry. I would like to take this opportunity to pay public tribute to him as an exceptionally conscientious, straightforward, knowledgeable and trustworthy Minister. He will be much missed—certainly by me, and I think by the whole Committee—and his knowledge of the issues, at a time when rather complex legislation is going through the House, is something that I hope my hon. Friend the new Minister will also soon acquire. I wish him well in his task.

I also thank my colleagues on the Committee for their work in producing not just the report that we are debating, but an extraordinary number of reports over the past 12 months. I also pay tribute to our very hard-working staff.

It is almost a year since the publication of the report that we are debating, and the concerns that we expressed then are almost exactly the same as those that we would express now. Britain is, of course, very dependent on imported fossil fuels for its energy, and anxieties about the level of generating capacity remain. The concerns about the fact that much of our existing capacity, in the form of the old coal and nuclear plants, will retire very soon, and about the need for that to be replaced, are as acute today—if not more acute—as they were last year. Absolutely enormous investment is needed in new capacity, storage facilities and so on. In the past year, there has still been progress, albeit insufficient, on energy efficiency, and on carbon capture and storage.

Britain remains a big net importer of energy—the figure was 29% last year. We are very lucky to have Norway on our doorstep, which is a friendly and reliable supplier of gas, but it is still desirable that we try to minimise our dependence on imports. In my view, that supports the argument for exploiting our shale gas reserves, for which we look to the Department of Energy and Climate Change for early approval, as has been recommended by the Committee. We will soon return to that subject, and I hope that we get the go-ahead soon.

Norway is a friendly supplier of gas, but even that fact cannot insulate us from future gas price spikes. Those who advocate relying mainly on gas to generate our electricity must recognise not only that, without the so far unproven economic availability of carbon capture and storage, gas cannot possibly get us to the 50 grams per kWh emissions target set by the Committee on Climate Change for 2030, but that there is also a real danger, as the Asian economies continue to grow, that global demand for gas will drive prices up, meaning that Britain’s economy will become less competitive if gas is our principal source of electricity generation.