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Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011

My Lords, first, we welcome these regulations and the new clauses on this issue added in the other place to the Energy Bill. They all lead towards ensuring that we have the available infrastructure in place and that necessary powers will be available. The noble Lord knows that we fully support CCS, and indeed that we made a commitment in government to fully fund the first CCS project. The regulations pave the way to that. However, as the comments from other noble Lords have highlighted, they do not remove the uncertainties that remain. Perhaps, in the light of the regulations before us, the Minister will be able to offer some reassurance on when the investment for the schemes will be available, because we have had no information on that yet. The CCS levy has been scrapped, the Government's argument being that the burden on business was unfair. Instead, the taxpayer is now to be funding the scheme through the Treasury but we do not know when that is going to happen, so any clarification from the Minister would be welcome. I want to ask two specific questions on the order. I understand what the Government are seeking to do here and I support that. I will talk through this and see if the Minister can follow, as I have not given him notification of this question. My understanding is that an applicant seeking access to or modification of a pipeline can seek the approval of the Secretary of State or another consenting authority—it need not be the Secretary of State—if negotiations fail to secure such access or modifications as are required. The legislation before us allows an appeal to be made if the consenting authority, which will mainly be the Secretary of State, thinks that there has been a reasonable time in which to reach that agreement. I hope that would only be in exceptional circumstances as it seems to me that, more often than not, the problems in reaching agreement will be not on technical issues but on the commercial aspects. The evidence base for decisions determines the criteria on which the consenting authority will make decisions, and it does not include commercial considerations. What if the stumbling block to agreement is not technical in any way but commercial? What if it is about price? It seems very difficult for the Government or any consenting authorities to intervene, as stated in the order. As I read it, the Government would not have the power to intervene. There may be an intention that there should be a regulator to ensure that the pricing mechanisms are fair but, unless I am misreading something in the order before us or its Explanatory Memorandum, I do not see that. Indeed, if we look at the evidence base for option 2, which is on page 10, the impact assessment says on these issues: "““If the consenting authority is required to determine the financial terms for access or modification for … pipelines and storage sites … they would be guided by principles similar to those already used in other sectors””." That implies that there is a role for the consenting authority and the Secretary of State to intervene on financial or commercial matters. It would be helpful to have some clarification because I am not sure I really welcome a Secretary of State intervening on commercial decisions. There could be a potential difficulty or a minefield if they are required to do that without sufficient guidance about which criteria they should take into account and how that should be conducted. My only other question is: in terms of the time allowed for negotiations before the applicant can make an appeal to the consenting authority, will there be any guidance on what is reasonable? It seems that different kinds of applications could take different amounts of time, as some will be more complex than others. If the negotiation is around price, that could make it even more complex as it could be that company A is trying to preserve a position that it may want to take in the future. While I certainly support the principle, I would like some further information on those points if possible.