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Renewable Energy (S&T Report)

My Lords, I think that I am the first member of the committee other than the noble Lord, Lord Oxburgh, to speak in this debate. I would like to thank him for his chairmanship of the committee, which was admirable, and I thank the right reverend Prelate the Bishop of Liverpool for coming together with the noble Lord, Lord Oxburgh, to initiate this debate. I would also like to thank the clerk   to the committee, Chris Johnson, and our two specialist advisors—Professors Anderson and Elliott. Together, we put together a very powerful report, which has already had quite a considerable influence on government policy. As all noble Lords who have spoken have made clear, the focus of this report on renewable energy emerged from the White Paper and from the urgency of the agenda for climate change. As the noble Lord, Lord Oxburgh, indicated, if this planet is to survive we cannot go on as we are. We have to cut back on carbon emissions and greenhouse gas emissions. It is very depressing that at present, if we look at the figures for carbon emissions, this country has been increasing them, rather than decreasing them, over the past few years. Yes, we have met our Kyoto targets, but we met those in the 1990s with the shift from coal to gas. Now, partly because of the very fast rise in transport emissions, total carbon emissions in this country are increasing. That increase reinforces our call in the report for the development of carbon-free technologies such as wind, tidal and solar power—which admittedly when one counts in the initial capital investment are not totally carbon free, but are so when working—and the carbon-neutral technologies of biomass energy. In the growing of biomass crops, the carbon being emitted is consumed. While the target priority must lie with cutting carbon emissions, other greenhouse gases are also important. I refer to coal mine methane emissions, which I believe the noble Baroness, Lady Platt, will talk about at greater length. Methane is 64 times more powerful in its emissions than carbon. That indicates why energy efficiency is so important. As the noble Lord, Lord Whitty, pointed out, the more we can cut back on our use of energy, the better. Many savings can be made through greater efficiency. It is the subject of the report the Committee is currently working on and which will be published before the House goes into Recess in July. It develops and carries forward themes in the current report. An issue that concerned us is the diversity of energy supply. The shift to gas means that we shall be very dependent on imported supplies from distant countries with unstable regimes. So the push towards renewables is urgent and in that regard it is clear that the committee has been critical of the Government not only for not placing enough priority on the push to renewables, but also for putting all their eggs into one basket, that of wind power. We have heard already the speech of the noble Earl, Lord Selborne, about biomass energy, and other noble Lords will talk about tidal and wave power. I also want to pick up on the noble Earl’s remarks about microgeneration. It is an important means by which we can move quickly to make carbon emissions savings. I was pleased to note that the right reverend Prelate picked up on the issue of R&D spend. Yes, to their credit the Government have increased the annual spend on R&D from £40 million to £70 million, but if this issue is of the highest priority, is that really enough? I shall be interested to hear what the Minister has to say. The title of the report concerns the practicalities of renewable energy. By how much are the Government’s targets practical? They are a 2010 target of a 10 per cent renewables contribution to electricity generation and the ““aspirational”” target of 20 per cent by 2020. We cast particular doubt on the 2010 target. The figures we had at the time showed clearly that in 2003, something like 3   per cent of our electricity was being generated from renewable sources, but half of that percentage came from hydro power and landfill which, under the renewables obligation, are not directly accountable. Only 1.5 per cent came from acknowledged renewables obligation sources. The figure given by the DTI for 2004–05 is 2.8 per cent. We must give credit for the gains made over the past couple of years and accept that the percentage is 2.8 per cent this year. But only 25 per cent of it comes from wind power. In their response, the Government placed a lot of emphasis on the 50 megawatts of new wind power that they expect to see installed during this year. So if 25 per cent of the percentage comes from wind power, it means that currently wind power makes a contribution of 0.7 per cent. Doubling that by the end of 2005 or the beginning of 2006 would take it to 1.4 per cent. Planning consents already in hand look like more or less doubling the percentage again. Over another two years, by 2008 we will have reached 2.8   per cent. But even if we add in the extra margin from other renewable sources, that is still a very long way off the target. We will have only two years in which somehow to make the leap from a renewables supply of somewhere in the region of 4 to 5 per cent up to that 10 per cent target. In spite of the Government’s faith that they will meet the target, there are real doubts about it. I am glad that the noble Earl, Lord Selborne, mentioned Woking. What is being done there with CHP—a scheme based not on incineration but on gas—with the by-product being electricity—is good work. The electricity is sold to low-income people in the area and is run on a private network. That private network was a limitation. One of the barriers was that there could be only 3,500 subscribers to your private network. When we said that that was silly, and that the scheme should be expanded, the Government stated:"““If the Committee’s recommendation were implemented, there would potentially be tens of thousands of domestic consumers on unlicensed distribution networks without regulatory protection and without access to the competitive market””." That is tantamount to saying that private consumers who pay 9.5p per kilowatt hour for their electricity would be pleased to know that they were benefiting from competition and not locked into a single supplier who was charging them 7p per kilowatt hour—which is what Woking is charging its users. Is that promoting competition? The other limitation is the question of tariffs—that when you generate your own electricity and put it into the grid, you receive the wholesale price of about 2p   per kilowatt hour, compared with 9.5p. In Germany, it is the other way round. For every kilowatt that you put into the system, you are paid roughly four times the consumer price. Some of you who have travelled in Germany may have noticed that little windmills are sprouting up on many chimneys for precisely that reason. Some German commentators to whom we spoke felt that some uneconomic investment was taking place. Nevertheless, there are many technologies which we, as consumers, could invest in now. For example, a mini windmill can generate enough electricity to cope with standby power requirements, such as those of a refrigerator. Similarly, passive solar energy to heat water and solar panels on the top of office buildings to supply air conditioning are used in Woking. All of that represents unexploited potential. It is an area that we should examine in more detail and develop. I should be interested to hear what the Minister has to say about today’s announcement that the Government are pushing forward on that front and precisely what they are planning to do.