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Renewable Energy (S&T Report)

My Lords, I want to concentrate today on one simple question: why do we need renewable energy? The answer seems obvious: it is because of the fears of global warming and resultant climate change, and also, in government eyes at least, because of our Kyoto commitments. But now the question begins to get more complicated. Perhaps we should first ask why our national efforts are concentrated on wind power, demanding huge subsidies met by the electricity consumer alone, despite the fact that replacement of fossil fuels by renewable sources is a national policy. No measures are proposed to apply a levy to gas or transport users to enable their fuels to be replaced or even used more efficiently. How can that be, given that transport is the most profligate producer of CO2 and that gas is a direct competitor of electricity in some fields? The answer is, I think, both simple and discreditable. It arises from the fact that wind, the most readily available renewable energy source, finds its outlet through electricity and so can be easily promoted through electricity regulation. For the Government, that provides a very convenient and rewarding source of funds not subject to Treasury scrutiny—a degree of freedom never previously experienced by spending departments, and an unforeseen and unfortunate consequence of the privatisation of the electricity industry. As a result, the renewable energy effort is very incomplete, despite the fact that some government resources are available for development projects. Those projects, many of them familiar to us for several decades, are a long way from commercial exploitation and will certainly prove very expensive. But since wind is the only practical game in town at present—in the Government’s eyes at least—let us dwell for a moment on its economic situation. The Government’s own estimate is that the subsidy, not the cost, of wind power until 2020 will be some £30 billion. The fact that such a sum can be spent in that way stems in part from the lack of Treasury oversight but perhaps more from the freedom of multiple departmental committees to reach consensus conclusions in what might be generously described as a policy vacuum with no effective ministerial leadership. We are all familiar with the description of a camel as a horse designed by a committee. Given the plethora of committees involved in renewable energy, one might expect their outcome to be a white elephant, or perhaps a herd of white elephants. In that connection, and in an effort to put the wind subsidy of £30 billion in more accessible terms, let me point out that that sum would provide 40 Millennium Domes or 1,200 brand-new city academies. Diversion of resources on that scale can only realistically render the UK less competitive with its overseas competitors. We are all aware of the development plans and potential of, for example, India and China, to say nothing of established industrialised countries in Europe and America. We are unique among those countries in our efforts to restrict CO2 emissions and there is no reason to expect that our approach will be mirrored by others. Are we then involved in a gigantic quixotic gesture without regard to our international competitive position? If so, then let us at least acknowledge that we are prepared to sacrifice our economy in a way that will have a minimal effect on the world’s problem—a quixotic gesture indeed. An approach that would simultaneously address the   problems of climate change and international competitiveness would be the acceptance of a renewed nuclear power programme. Our present programme, which has served us safely and well, is nearing the end of its commercial life, with a resulting inevitable increase in CO2 emissions exceeding the promise of the renewable energy aspirations. We need leadership to promote the only available solution to the need for CO2 reduction at an affordable cost. Let me say—I have said it before—that a nuclear programme to save the same amount of CO2 as that hoped for from wind generators would cost in total less than half the subsidy envisaged for wind generation. What kind of fantasy land are we living in? I know the Government will say that the PIU report of 1992 did not   conclude that nuclear power was cheaper than wind power. I have read that report and I found it   astonishingly superficial and na&-uml;ve. There are authoritative analyses of comparative costs available world-wide which deserve—but do not receive—serious and professional evaluation. Not least of those reports is that of the Royal Academy of Engineering last year. There is a need for a more open-minded approach in   government to this problem and I welcome the rumoured intention to revisit the policy which has led to the exclusion of the essential contribution of nuclear power, ineffectively disguised by the claim that the option is ““being kept open””—those magic words. The actions of government over the past eight years have been of neglect, delay and downright hostility, all of which must be brought to an end. The problem is much too serious to be decided by ill-informed prejudice. I claim some experience of this subject and I plead for a return to the leadership which any government owes to the nation on such issues. I fear that the Minister will attempt to brush aside the points I have made, but I ask him at least to drop his customary references to ““market forces””, which are nullified in practice by government intervention and bias. What we have is, at best, a highly directed market designed to promote an irrational policy. This cannot go on.