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Energy Bill [HL]

My Lords, as the noble Lord, Lord Oxburgh, said on the previous amendment, it is clearly the general target of the Government—as shown by providing the ROCs incentive—to increase the amount of renewable energy in this country by 2020, and to make offshore wind the major component of the provision of that quota. We have already done reasonably well, in that there are already 1.3 gigawatts of offshore wind operating around our coasts, and other projects are in the pipeline. However, the process takes considerable time. For it to happen—again, as the noble Lord, Lord Oxburgh, said—we need not only the incentive of the ROCs in place, but the means of mobilising substantial sums of private capital. That private capital needs to minimise risk. At the moment, the problem for an offshore wind facility, either in operation or provisional—with a lease granted by the Crown Estate or with an agreement to lease—is that the prospect of an oil or gas facility being put in the same area will kill that investment stone dead. It would certainly put off prospective investors in that scheme or potential scheme. The amendment therefore seeks to ensure that investors in the industry and the supply industry—an important economic by-product of offshore wind—have sufficient confidence to invest sums of money in offshore facilities that are not threatened by effectively being displaced by a future oil or gas facility. That is needed because of the present disparity of provision in the rules governing offshore oil and gas consents. The amendment would prevent a forced intervention by the Secretary of State to consent to an oil and gas works on top of an existing lease, or agreement to lease, for an offshore renewable project. It would allow the offshore oil or gas project to occur were consent to be given by the operator or potential operator of the offshore activity—in other words, provided that negotiations could operate and an agreement could be reached, there could be coexistence. Although theoretically both sides of the equation recognise the need for coexistence, there is no balanced system for dealing with them. It is not that we are creating a special, privileged position for offshore wind, because the consenting system for offshore renewables in general—tidal and wave power would also be covered by the amendment— includes a requirement to negotiate with other sea users. The offshore operator is required to negotiate with the potential gas operators and other users of the seabed. On the other hand, the current guidance from the Infrastructure Planning Commission—which, until the Government get their way, is the planning authority—requires that the views of other sea users must be sought out, that action taken in response to those views must be reported and that justification must be given where no action is taken. However, the Petroleum Act requires oil and gas activity to take due regard of other projects, such as renewables, but there is no requirement to negotiate in those circumstances. We are not talking about a level playing field at the moment, and I therefore hope that the Minister and the Government will recognise that there is an issue here. There is particularly an issue about discouraging the substantial amounts of private investment that will be needed in these offshore technologies in order to meet the Government’s targets for renewables. It is already public policy to reach those targets, but the present system threatens confidence in investments in those targets. It is certainly the case that for those seeking finance from the City and elsewhere for these projects—particularly as we go further offshore, as we will need to do—questions of confidence and the possibility of the leases being overridden by a subsequent decision on oil and gas facilities are major considerations and some of the reasons why such investment is inhibited. I hope that the Minister will at least recognise that this is a problem. If he is not prepared to accept the exact wording of this amendment, I hope that he will recognise that this is something that the Government have to address and that some degree of equal treatment will be needed down the line. I think all sides of this Committee recognise the importance of meeting these renewable targets and want to remove any inhibition in doing so. Therefore, this amendment, or something like it, is a necessary step to ensure that the investment is there to meet those targets. I beg to move.