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Climate Change and Sustainable Energy Bill

I want to make a few points, but first I congratulate the hon. Member for Edinburgh, North and Leith (Mark Lazarowicz) on such a good Bill. In his remarks, he concentrated on micro-generation, but I want to say something about the renewable heat obligation, as it is a vital part of the Bill. I am aware that Sir Ben Gill’s taskforce recently came out against renewable heat obligation, but I also note that the Royal Commission on Environmental Pollution recommended such an obligation. Furthermore, as I mentioned in an intervention, a report from the Scottish Executive showed that biomass could not only contribute to reducing climate change, but create about 2,000 jobs in rural areas of Scotland. Our farming and forestry industries face tough times so that would give them an important boost. Yesterday, when the Government introduced the renewable transport fuel obligation, the National Farmers Union in Scotland issued a press release that can only be described as glowing—the first time it has ever done so for a Government policy. That just goes to show what those obligations can do for industry in rural areas, in England as well as in Scotland. The renewable heat obligation would not only tackle climate change by reducing carbon dioxide emissions, but would stimulate the biomass industry and help with energy security. We worry about having to get supplies of gas from places such as Kazakhstan and Russia, and we worry that coming winters may be extremely cold; the measure would do more to assure energy security with supplies from small-scale developments in our own nation. The Bill mentions fuel poverty, although not in great detail. A worrying thing in Scotland is that a rising number of people are suffering fuel poverty as the cost of energy increases. All the energy companies recently announced high hikes in both gas and electricity prices, which puts thousands more Scots, and other people in the UK, in fuel poverty. Renewable fuel obligations would help to diversify energy supply and thus tackle fuel poverty. However, when considering all such schemes, we must bear in mind the fact that costs are important. To reduce fuel poverty, we must reduce the cost of electricity to consumers. We should not get carried away by micro-generation. Renewable energy also means that we have to feed into the national grid. The Minister will not be surprised to hear me mention transmission charges; my colleagues and I have tackled him on that subject on many occasions, going back to the Standing Committee on the Energy Act 2004. It is something that we are very concerned about, because the transmission charge regime proposed by Ofgem will be a huge detriment to the development of renewable energy in the north of Scotland—an area that is particularly suited to the development of renewable energy. The 10-year cap is too short to allow a payback on many of these developments, and of course they only get the full 10 years if they are up and running when the cap comes into being. This is a serious issue. I know that the matter is out to consultation. I do not expect that the Minister will have anything to say about that today, but it is an important arm in dealing with renewable energy. The Bill will go a long way to help the provision of renewable energy, but there must be action on transmission charges to ensure that we get the benefit from the massive potential from wind, wave and tidal power that there is in Scotland, and which may well be crippled by the transmission charge regime that is currently proposed.