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Energy Bill

It is about £70 billion, but I have slightly lost track; there is, however, a mounting pile of both waste and cost. I should add that the nuclear industry does not want to know about making a level playing field. Returning to my theme, the whole process would be made a great deal easier if we had a sensible carbon price. If we had such a carbon price, we would not need to exact so much money through a levy from electricity consumers. It is the electricity consumers who will have to pick up the tab for the levy, and £9.5 billion is quite a lot of money. It could be raised through a carbon tax—that was a Freudian slip. I have long advocated our having a carbon tax, but I should have referred to it being raised through a carbon price—although that does not really matter because a sensible carbon price would, in effect, be a carbon tax, so that is just semantics. It has now become really quite respectable to suggest that we should have a mechanism for underpinning the price of carbon. That has now been suggested by Lord Turner, chair of the Committee on Climate Change, and by many others. If we had a realistic carbon price, that would help to level the playing field for competition in generation. We need to do that, because it is unrealistic to think we can continue to subsidise everything, as we have to do now to get decarbonised electricity supply. We cannot do that through regulation because of the liberalised market. We could regulate, however, to say not only that no coal-fired power station will be built without CCS in place, but that there will be no coal-fired generation at all. Under that restriction, only zero or low-carbon generation technologies would be licensed, but we would not get those power stations built, because the capital markets are in such a bad state that no one would invest in them. We are therefore, in effect, having to cough up subsidies in order to satisfy bankers. It all comes back to bankers—I am sorry to have to say that, but it is true. They want to see returns on their investments, and the only way they can get them is through subsidies: in this case, it would be the CCS levy, and in the case of wind and other renewables, it would be renewables obligation certificates. Either way, there has to be the subsidy. That brings me on to the first matter that I would have liked the Bill to address. As has been mentioned, we have some of the best raw energy-producing resources of any country in the world in terms of wind, wave and tidal stream, but although some of our wave power and tidal stream technologies are at the point of being ready for commercial exploitation and deployment, that will not happen under our current market support regimes. Even if the double-ROCs for offshore wind could be accessed, it would not be enough because such new technologies have higher capital costs, which can only come down with increased scale, the development of supply chains and so forth. Other countries, notably Germany and Denmark, have deployed market support systems that will develop technologies so they reach the point of cost reduction. In the process, although such countries may have to invest a bit, they will gain enormously in terms of the green industries they develop. We could have had the wind industry in Britain if we had done that. Like Germany, we might now have 250,000 extra jobs and several billions of pounds-worth of turnover from the manufacture of wind turbines. We have an opportunity with wave and tidal stream technology, but it will not happen unless we put in place a market support mechanism—to be brutally honest, a subsidy—that will bring that through. I would have liked to have seen a provision in the Bill to extend the levy principle to support and foster new technologies, because none of the current market support systems are doing the job. We could have a magnificent tidal stream industry in this country, as exemplified by the first commercial machine, SeaGen, in Strangford lough. There is a danger, however, that those involved in the industry will be forced to go to other countries, where there is a market support mechanism.