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Energy Bill

moved Amendment No. 11: 11: Before Clause 80, insert the following new Clause— ““Provision for greenhouse gases emissions performance standard for electricity generation (1) The Secretary of State may by regulations, make provision for a greenhouse gases emissions performance standard to set the maximum level of carbon dioxide that may be emitted per unit of output by any generating station requiring consent for construction or extension under section 36 of the Electricity Act 1989 (c. 29) (consent required for construction etc of generating stations). (2) Regulations made under subsection (1) may include provision specifying— (a) how proposed generation stations may comply with any greenhouse gases emissions performance standard and demonstrate compliance with any regulations made under this section, including by the capture of carbon dioxide at the generating station and its transport to and injection into geological storage provided that such activities are licensed in accordance with applicable laws and regulations; (b) the basis on which emissions of greenhouse gases from combined heat and power generating stations shall be calculated such that the unit of output includes useful heat produced in addition to electricity generated by any such generating station; and (c) any sources of electricity generation, including electricity generated from renewable sources, that are deemed to be compliant with any greenhouse gases emissions performance standard. (3) No consent shall be granted under section 36 of the Electricity Act 1989 for any generating station that does not comply with regulations made under subsection (1). (4) Before making regulations under subsection (1) (including setting the level of the greenhouse gases emissions performance standard), the Secretary of State must consult such persons as are, in his opinion, likely to be affected by or have an interest in the regulations. (5) Regulations made under subsection (1) shall be made by statutory instrument, and shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament. (6) In this section ““greenhouse gases emissions performance standard”” means a standard prescribed by regulations setting the maximum level of carbon dioxide that may be emitted per unit of output from an individual generating station.”” The noble Lord said: My Lords, many amendments have been tabled to this Bill, but it seems to me that this area is one of the most obviously important and straightforward in terms of concept, in terms of being able to deliver it and in terms of the positive effects that it would have on future greenhouse gas emissions. We are very clear and we understand very well that for ordinary capital goods such as you and I might buy, such as motor cars, there are regulations about emissions. One of the successes, and one of the ways in which Europe is starting to lead the world, is in emissions regulations for motor vehicles. In doing so, it leads the world and the rest of the world catches up, because Europe is such an important market in that area. Cars produce a certain amount of carbon dioxide, and transport is important; but the energy generation sector is even more important in terms of emissions. Why do we not then apply emissions standards to power stations? That is hardly a eureka moment; it seems so totally obviously that we should do that. To make that reasonable, since power stations have long lives, it would be unacceptable to apply such a standard to existing power stations, because it would be very difficult to make them comply. We do not want to allow the lights to go out across the nation. This amendment makes the straightforward proposal that the Secretary of State should have powers again to set such standards. This is one of the areas in which we could again show leadership within Europe; more than that, it is particularly important because power stations are pieces of capital equipment that have very long lives indeed. If you build them and you start operating them, they will operate to those standards for many decades, and it is, therefore, important that we get the standards of emissions of such power stations right now. There is an argument, which the industry makes, that none of this is necessary because the EU Emissions Trading Scheme has a carbon cap which should solve the power sector’s issues around carbon emissions by itself. That is a completely erroneous argument. The EU ETS is extremely important, but we all know—and this has been accepted on all sides of the House in many other ways—that just relying on one type of instrument is not sufficient in the area of climate change. We have to use a number of those instruments. If the power sector used up a large number of the carbon units allowed under a cap-and-trade system, that would technically work, but it would mean, because of the inelasticity of the demand for energy, that the rest of the economy had to deal with a hugely lower number of carbon credits, because the rest would have been used up by the energy sector, given that it was unable to respond quickly enough because of its old technologies. That would create a situation that everyone, from the Stern review to the Government, wished to avoid. It would force the rest of industry to go through a forced and accelerated decarbonisation process in the main part of the economy, whether it be manufacturing, services, mining or farming—all of those areas—particularly in terms of the EU ETS. Large areas of industry would have to adjust even quicker to those caps coming down. The answer to that is to have other instruments as well. Regulation, which is accepted for every other sector of product design and installations, should be applied to this area. Should we really allow power stations that will last for some 50 years to be built to the wrong standards, when they cannot necessarily be modified? That would be unacceptable. Even in terms of the timescale for the 2050 targets under the Climate Change Bill, power stations that are built now will still be operating at that time. That time is not far ahead. When I researched this subject, I was interested to note that the EU Large Combustion Plant Directive—the Minister probably knows far more about this than I do—covers noxious substances such as sulphur dioxide, nitrogen oxide emissions and particulates. Nitrogen oxides are some of the worst greenhouse gases. Yet, strangely, that directive does not include carbon dioxide. I would say to the Government that there is a route. There is an organisation that I did not realise existed called the UK National Emission Reduction Plan, NERP—which I noted from the Defra press release was a rather unfortunate term; I would not work for an organisation called that—whose secretariat has an important role. If the Government cannot accept this type of enabling amendment, I would at least like to hear that they would lobby the European Council and the Council of Ministers very strongly to widen that directive to include emissions that are equally important in terms of climate change and carbon dioxide. I beg to move.