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Revised Draft Overarching National Policy Statement for Energy (EN-1)

I thank all noble Lords who have contributed and all those who have come to listen; it is much appreciated and shows the keenness with which we take this subject. As the noble Baroness said, we finished the year off with energy, we are starting it with energy, and, my goodness, we are going to be spending a lot of time on energy over the next month. We have got a lot on our plate. I hope that despite some complaining in the ranks, noble Lords here recognise that this Government do listen. I think that it is probably mistaken to get into the technicalities of a lot of the parliamentary procedure, because we have a lot of conversations outside the Chamber—we have a lot of listening; we have breakfast; we have had all sorts of things. I hope that you agree that we are listening. The reason we are doing this is that this is a subject that transcends all Governments. It is fundamental to the country that we have a time line that goes to 2100, as I shall enunciate in a few minutes. In fact, our own pathway goes to 2050. So this is a major subject that in my view is largely outside the subject of party politics. As I think everyone will also understand, we have some serious heavy lifting to do. We have had a long time of inactivity; a long time of resting on the laurels of the wonderful wealth of oil from the North Sea which has kept this country afloat. As I said in an earlier Question today in answer to some of the noble Lord’s questions, we have got to spend more than £110 billion on our infrastructure just to get it up to scratch in the next 10 years. This is a massive project that confronts the Government today. I turn to the specific questions which, if I may, I shall take in order. The noble Lord, Lord Giddens, as always, is excellent on this subject. He questions our striving for renewables and indicates that we want to achieve 30 per cent. In fact, as I said in our opening speech, we are committed to 50 per cent—which, even for a thicko like me, is larger than 30 per cent. That is our commitment: to have half our energy from renewables by 2050. The noble Lord is also right that there is a huge amount to do. The noble Lord also asked what happens if CCS does not work. I am very grateful to my noble friend Lord Oxburgh, who really said it all for me. It means that I have to say very little—so I will not. If it does not work, which we fully intend it to do, we will obviously rely on nuclear. I shall come back to the CCS demo project later, if I may. The noble Lord also asked whether we should put faith in ETSs. ETSs are what we have got as a European standard. As the noble Lord, Lord Deben, said, we should listen to the EU on these subjects. I do not entirely agree with him, but we should listen on some things, and I think that this is good because it works. We should challenge it the whole time and ensure that it is ticking the box. But there is a considerable take-up in this area. If I could wave a magic wand, of course we would have targeted regional planning. It makes complete sense. It requires a lot of cross-government co-operation, and now that we have been in government for six to nine months, it is a subject where we should be looking to achieve, particularly if we are going to develop the offshore renewables industry. If this is going to become one of our great exporting subjects, we should have a centre of excellence, and I have suggested to our Secretary of State that that is a subject we should take on. I am grateful for those comments. The noble Lord, Lord Teverson, asked about the CCS competition update. As I am leading the negotiations on the competition, I can tell the Committee that next week we have our second meeting with the chairmen of Shell, National Grid and Iberdrola at 8 am on 19 February. They are coming back to us with their offer regarding what they can achieve within the budget that we have set them. I have no doubt that we will not accept their offer, they will go back and then come back again, hopefully, with something that is more acceptable. The timetable that we have set ourselves is a vigorous one; I want to see heads of agreement signed early this year with a view to having a legally binding document by October, and they are committed to that timetable. It is important that this should happen, and I am grateful that my noble friend Lord Oxburgh should give such encouragement in this area from a scientific point of view. The noble Lord, Lord Teverson, mentioned consultation with local planning authorities and where we go on that. It is a requirement of the Act that local planning has to happen first. That is the normal practice that we have had in this country and we are not changing it. For major infrastructure projects, we are abolishing the IPC because we believe that it is a quango—it is not an elected body—and ultimately it should be the Secretary of State who makes the decision on major planning projects. We have debated and talked about that on many occasions. The noble Lord also talked about the biomass timescale. That is set out in the Renewables Obligation Order 2011, which should be implemented in April this year. I enjoyed hearing the dulcet tones of the right reverend Prelate the Bishop of Liverpool this morning on ““Thought for the Day”” as I was trying to think for the day and about how to deal with this debate; it was marvellous to hear them coming through on the subject of bankers. He can talk about any subject, can’t he? It is marvellous to have such expertise in this House and indeed in Liverpool. The right reverend Prelate wants to know what goals we have set ourselves. Pathway 2050 is one of the clearest documents that have been produced by the Government and shows the enormous challenges and the principles that we have to confront. The document is there as a target, and 2050 is a long way off. The right reverend Prelate asked us to raise the subject of nuclear risk assessment, particularly in the flood areas. We can do no more than consult the experts, who have laid out the agreement up to the year 2100—hopefully, I will still be alive then—which is the timeframe within which the flood assessment is contained. He also mentioned carbon counting, an issue that he has raised before, and I am grateful for that. There is a suggestion that the IPC should be responsible for carbon counting. We think that the Government’s policy in this area is perfectly adequate. Obviously it is something that we have to take seriously and, as with all these things, I will take the right reverend Prelate’s suggestions away and consider them further. With regard to his comments on China; yes, these issues have been raised with the Chinese delegation at a private meeting with the Secretary of State as well as through the Prime Minister’s Office. There was the issue of the gap between planning applications and the IPC and when that will happen; the noble Baroness asked about that as well. As my noble friend Lord Jenkin said, we are grateful that the IPC has thoroughly co-operated in this process, and it is to be commended. In fact, I think that my noble friend went public in saying that it should co-operate with us, and I am glad that it has taken on board what he has suggested. There are two planning applications for power stations that are likely to be approved by the IPC, but anything other than that will be in this interregnum period, which looks like being a fairly smooth process. My noble friend Lord Jenkin, eruditely as always, asked a number of questions on the issue of offshore and onshore. It is our belief, and I think it is a Conservative tenet, that market forces are best placed to determine how the two marry up together. I have referred to that, and I will do so again at a later stage. The noble Lord also mentioned shale gas, as have a number of noble Lords. We welcome shale gas, of course; if it reduces the price of gas, that will be fantastic. There are no signs as yet that the Americans are going to supply it to the outside world, as they are intending at the moment to keep it within their own country, but anything that reduces the price of gas will be of great benefit. I have mentioned parliamentary process, but will now mention it in more detail. I am not going to try to second-guess the parliamentary process regarding these national policy statements. It is not for me to do so; I am only a young whippersnapper in this world. But the changes that are being made through the Localism Bill will give the opportunity, within a 21-day period, for people to register their amendments, and then there will be a vote on them. The difference between now and then is that that vote will be binding, whereas before it was not worth the paper it was written on. If you add that to the general consultation that we are having through these various debates and parliamentary issues, I feel confident that all noble Lords will recognise that we are having our say. The Energy Bill is starting in this House, where it will be honed, argued over, debated and made fit for purpose. That shows the intent of the Government and the recognition of the excellent contribution that noble Lords make here. My noble friend Lord Jenkin raised a number of other issues. I will be happy to discuss them with him afterwards or put them in writing to him. Some of the issues refer to nuclear and I will deal with them, if I may, in the nuclear debate, on which I notice his name is down to speak. He asked why we have an interim milestone of 2025. We have to have interim milestones; we have to have something that most of us can believe we will actually see, and 2025 is a perfectly reasonable figure. I was disappointed that the noble Lord, Lord Judd, was not as complimentary as he might be, although I took some of the serious and excellent comments that he made on board. I take no persuading of his view on overhead power cables; in fact, when I was a parliamentary candidate I was asked what was the one Private Member’s Bill that I would introduce and I said the removal of overhead cables, so he is preaching to the converted. Of course the CPRE is an excellent organisation, and we listen to it with great intent—well, I do, anyway. I really think that the noble Lord has got the wrong end of the stick on the Holford rules. I want to read something that I read earlier, paragraph 2.8.5 in EN-5: "““Guidelines for the routeing of new overhead lines, the Holford Rules, were originally set out in 1959 by Lord Holford, intended as a common sense approach to the routeing of new overhead lines. These guidelines were reviewed and updated by the industry in the 1990s, and the IPC should bear them and any updates in mind as they examine applications for overhead lines””." It goes on to list what the Holford rules state—on pages 12 and 13, for those who have the statement—and then continues: "““In considering whether all or part of proposed electricity lines should be placed underground to obtain the benefits of reductions in landscape and/or visual impacts, the IPC will need to weigh the reductions in visual intrusion against the impacts (economic, environmental and social) and technical challenges of undergrounding””." That seems to be a common-sense approach.