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Davey quizzed

March 9, 2012 11:01 AM

• [Mar 08] Glyn Davies (Montgomeryshire, Conservative): HOW many households he estimates will be taking part in the feed-in tariff scheme by 2015 following implementation of his reforms.

• Edward Davey : We now estimate that, thanks to our reforms, there will be nearly 1 million installations under the FITs scheme by 2014-15, compared with only 350,000 under the old scheme. Final numbers will of course depend on future technology costs and market growth. As for household share, 97% of current installations are classified as domestic, and it is likely that the majority will continue to fall into that category.

Glyn Davies (Montgomeryshire, Conservative): The feed-in tariff regime, as recently reformed by the Secretary of State, strikes a fair balance between those who install solar PV and the consumer who meets the cost. It will result in far more installations and it will be more popular. Does my right hon. Friend agree that, in a democracy, striking that balance in achieving his renewal energy targets and the consequent support of the people should always be his objective?

• Edward Davey : I think I can agree with that. My hon. Friend is right to say that our reforms will boost solar power, help more families and reduce costs in consumer bills.

David Hanson (Delyn, Labour): The way in which this has been handled has been a bit of a disaster. I accept that the Minister has made some changes, but they have been detrimental to the overall confidence in the scheme. Putting that to one side for a moment, may I ask him to look seriously at enabling bigger entities such as community centres, schools and other community facilities to benefit from the scheme, to provide a kick-start over and above that given to the householders who participate in it?

• Edward Davey : In our proposals, smaller community projects will benefit from the decision to apply only the lower aggregated tariff to generators with more than 25 installations. We are now consulting on a definition of "community"

and on how that could be used, including a possible tariff guarantee process and a higher rate for community-owned multi-installations, compared with commercial ones. I have to say to the right hon. Gentleman that that type of community approach was not in the old scheme.

. .

• [Mar 08] Michael Connarty (Linlithgow and East Falkirk, Labour): When he expects energy companies to secure investment for new nuclear power stations.

• Edward Davey : The timing of investment decisions in new nuclear is a commercial matter. The Government are encouraging investment in new nuclear through a range of actions, including its proposals on electricity market reform. The Government have also committed to working with relevant developers to enable early investment decisions to progress to timetable, including those required ahead of electricity market reform implementation.

Michael Connarty (Linlithgow and East Falkirk, Labour): I thank the Secretary of State for that tortuous and absolutely uninformed answer. As secretary of the nuclear industry all-party group, I strongly support this industry, but the problem is that progress has been stalled for some time as it would appear that there has been not much talking and no

action. The Government have to do more, because we are seeing the resources in this industry and the commitments to investment and technology going elsewhere and not coming to the UK as we hoped when we started to think sensibly about using this very low-carbon source of energy.

• Edward Davey : I have to say that I am extremely surprised by what the hon. Gentleman has said, given the Labour party's record on this issue, as it dithered and delayed for all its time in office. I do not recognise the situation he describes. Three consortia are putting forward proposals for 16 GW of new nuclear. Let me tell the hon. Gentleman that people are investing serious money in this industry and that we are making real progress.

Priti Patel (Witham, Conservative): May I welcome my right hon. Friend to his new role as Secretary of State? How confident is he that Britain will possess the world-class skills necessary to create a thriving UK nuclear industry?

• Edward Davey : I am very confident. When I joined the Prime Minister for the Anglo-French summit in Paris recently, we were signatory to 12 commercial agreements, which included agreements with further education colleges that will be helping with that supply chain. However, it is not only FE colleges that will be involved, as there are supply chain improvements for training British employees in this new industry all over the country.

Mark Durkan (Foyle, Social Democratic and Labour Party): Apart from the wider policy issues arising from the Government's attempting to skew investment towards nuclear through the carbon price floor, has the Secretary of State been able to consider the particularly adverse implications in the context of investment for energy in Northern Ireland, given the serious implications stemming from the single electricity market there.

• Edward Davey : I have to disagree with the hon. Gentleman. The carbon price floor is important if we want to move to a low-carbon future, to which I am completely committed. We understand the impact of the carbon price floor on energy-intensive industries. The Minister of State, Department of Energy and Climate Change, my hon. Friend Charles Hendry is talking with his colleagues in Northern Ireland to try to mitigate those issues.

Bob Blackman (Harrow East, Conservative): Clearly, Labour Members forget that they dillied and dallied on nuclear power for 13 years. Following the UK-French summit, what action is my right hon. Friend taking to accelerate putting base load nuclear electricity into our grid, which is of course the cleanest form of energy we can have?

• Edward Davey : I am continuing the policies set out by my predecessor, who gave strong support for that. I have to tell my hon. Friend that when I was reading my brief on this issue, I had only one worry: the design of many of these new nuclear reactors is called European pressurised reactors, and I know that Europe can create pressures and get reactions in this House-but I hope that on this occasion, we can unite.

Tom Greatrex (Rutherglen and Hamilton West, Labour): Is the Secretary of State aware of the concern that if Areva were to win the contract to build the reactor at Wylfa, the supply chain work may not be likely to go to UK companies? Given the comments in the Business Secretary's confidential letter to the Prime Minister, which received some publicity earlier this week, what do the Government intend to do to maximise the opportunities for UK firms in the supply chain by encouraging contractors to buy where they build?

• Edward Davey : The Government have been focusing on this with great intensity from the Prime Minister down. Indeed, when we held discussions with our French colleagues and EDF, we made it clear that we expected there to be British involvement in the supply chain, and that is beginning to happen. I refer the hon. Gentleman to the many agreements that were signed in Paris, including a ground-breaking £400 million deal on nuclear projects between Rolls-Royce and Areva.

. .

Charlie Elphicke (Dover, Conservative): What steps he is taking to lower consumer energy bills.

• Edward Davey : First, we are directly helping about 2 million vulnerable households with their bills through the warm home discount scheme, and many more households are benefiting from subsidised energy efficiency measures under the carbon emissions reduction target scheme. Secondly, later this year the green deal and the energy company obligation will provide energy efficiency measures at no up-front cost to households. Thirdly, we are looking to help consumers get better prices by harnessing their collective purchasing power.

Charlie Elphicke (Dover, Conservative): I thank the Secretary of State for that answer. On consumer energy bills, does he agree that it is wrong in principle to finance carbon commitments on the back of the poor, which was the policy of the previous Government, and that we need a more imaginative way forward?

• Edward Davey : I agree with my hon. Friend. I am a liberal, but I strongly believe that collective action can help solve some of society's ills. That is why I promoted collective purchase and switching as consumer affairs Minister and am continuing to do so as Secretary of State for Energy and Climate Change. It is a shame that the party of Keir Hardie and Aneurin Bevan forgot the power of collective action in its 13 years in government.

Luciana Berger (Liverpool, Wavertree, Labour): It is interesting that the Secretary of State referred to the CERT and Warm Front schemes, which Labour introduced and the Government are scrapping. I welcome today's announcement on funding for green deal training, however. It is a good first step towards delivering the apprenticeship scheme that a Labour amendment added to the Energy Bill. Yesterday, however, DECC released figures showing that 7 million homes still need cavity wall insulation, yet the Government impact assessment for the ECO shows that under the green deal cavity wall insulations are set to plummet by 67% next year. At our

last question time, I warned that that will lead to a loss of 3,000 jobs. What is the Secretary of State going to do to ensure that these jobs can be safeguarded?

• Edward Davey : The green deal and the ECO are extremely good proposals. They replace proposals that had a place, but which were not as effective as our proposals will be-[Interruption]-because our proposals are in a package and we have a range of other regulations to help on energy efficiency. We will conduct another impact assessment to show how beneficial our measures are for jobs and the industries concerned.

Gordon Birtwistle (Burnley, Liberal Democrat): Does my right hon. Friend agree that the project in Burnley to clad hundreds of Calico Homes, which is funded by British Gas, Calico and this Government, is the right way forward as it will save money, keep the houses warmer in winter, keep energy bills down and help achieve the aim of having green energy?

• Edward Davey : My hon. Friend is a huge champion of energy efficiency in his constituency, and he is absolutely right. It is the ECO scheme that is making such policies possible. As a result of such measures, we can move on to solid-wall insulation, which for too long has been a poor second cousin.

Graham Stringer (Blackley and Broughton, Labour): AF Consult estimates that huge savings could be made by changing the energy mix away from windmills. Why does the Energy Secretary not truly dash for gas and utilise the huge shale gas resources that are in Lancashire?

• Edward Davey : We need to balance a range of priorities in energy policy, including energy security, affordable bills and tackling climate change. That is why this Government have a portfolio approach to energy generation. We are looking at low-carbon technologies, including wind power, carbon capture and storage, and new nuclear.

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Andrew Turner (Isle of Wight, Conservative): What his policy is on encouraging onshore wind energy production.

Chris Heaton-Harris (Daventry, Conservative): What his policy is on encouraging onshore wind energy production.

• Edward Davey : A responsible energy policy for this country is one that includes onshore wind. Well-sited wind farms, offering the benefits to local communities that we are introducing, are one of the cheapest ways of cutting our dependence on imported gas over the next decade and keeping emissions down.

Andrew Turner (Isle of Wight, Conservative): I thank the Minister for that answer. Is he aware of the new blade tip generation technology, which is more efficient than traditional turbines and can be installed with no lasting adverse effect on the countryside? Will he support moves to manufacture this innovative form of renewable energy on the Isle of Wight in support of the eco island initiative?

• Edward Davey : I am grateful for my hon. Friend's question. It is good to see examples of the economic benefits that wind power can bring. We are aware of companies developing new technologies for turbines, including for small-scale wind power generation such as the blade tip technology he cites. The support we provide for wind power generation in the UK will encourage use of appropriately sited and efficient wind developments.

Chris Heaton-Harris (Daventry, Conservative): Can the Secretary of State confirm that if we add the number of existing turbines to those going through the planning system, we have enough in

place to hit his Department's 2020 targets? If that is the case, does that not suggest that the level of subsidy for these things is too high?

• Edward Davey : I thank my hon. Friend for his question. He and I may disagree about the significance of onshore wind, but I appreciate the measured way in which he has engaged with me and the Prime Minister on this issue. I can tell him that 5 GW of onshore wind power generation has already been built, that there is planning consent for a further 6 GW and that planning permission is being sought for 7 GW-worth of projects, only some of which will be approved. Given that the ambition was for 13 GW, most of the development that the country needs is indeed already on the table. As for subsidy, the subsidy levels go down as costs go down, and we are proposing a 10% reduction in subsidies for onshore wind.

Dennis Skinner (Bolsover, Labour): The previous Energy Secretary opposed the idea of limiting how close wind farms could be to homes and residential areas, as is the case in Scotland. What is this Energy Secretary's view?

• Edward Davey : The hon. Gentleman will know that, as my right hon. Friend the previous Secretary of State said, this is a planning issue that needs to be determined at the local level.

Jim Shannon (Strangford, DUP): Given the news the Minister has just given regarding the progression of energy production from onshore wind, can he assure us that wildlife migratory routes will not be inhibited by the establishment and development of wind energy production? I want to make sure that wildlife will not be harmed by energy provision and development measures.

• Edward Davey : I know that environmental impact assessments have to be done and I believe that those sorts of assurances have to be given.

Andrew George (St Ives, Liberal Democrat): May I congratulate my hon. Friend on securing his new position? He said that wind is the most efficient form of renewable energy, but what will the Government do to ensure that communities benefit from new wind energy projects?

• Edward Davey : First, we need to make sure that communities are listened to during the planning process, and the planning reforms will do that. We are committed to ensuring that local communities capture the full economic benefit from hosting renewable energy projects, particularly the retention of all the business rates that these installations pay.

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Pauline Latham (Mid Derbyshire, Conservative): What discussions he has had with the Secretary of State for Business, Innovation and Skills on the Green investment bank.

• Edward Davey : I have regular meetings with Cabinet colleagues to discuss a wide range of issues. My Department works closely with the Department for Business, Innovation and Skills on the Green investment bank, given the bank's potential to play a major role in catalysing private sector investment in the low-carbon economy.

Pauline Latham (Mid Derbyshire, Conservative): I thank the Secretary of State for that answer and welcome him to his new post. I have been championing Derby as a potential location for the Green investment bank, because we have had one or two knocks to our confidence in Derby and lost some jobs. [Hon. Members: "Too late."] If I am too late-I have not heard the announcement-I would like to suggest that the Secretary of State works with his colleagues to see what other investments the Government can make in Derby to return confidence to the area.

• Edward Davey : I know that my hon. Friend is a real champion for Derby and is trying to get investment into the city, but I must tell her and the House that the Secretary of State for Business, Innovation and Skills has announced that the headquarters of the Green investment bank will be located in Edinburgh, with its main transactions team based in the London branch.

Chi Onwurah (Newcastle upon Tyne Central, Labour): In his discussions with the Secretary of State for Business, Innovation and Skills, did the Secretary of State make an assessment of the number of nuclear power stations, green chemicals plants, wind farms or tidal power generators that would be located in the City of London, and does that account for his decision to locate the Green investment bank there?

• Edward Davey : I think that the hon. Lady needs to read the Secretary of State's written ministerial statement, which sets out his reasoning in detail. We spent a long time looking into the matter because there were 32 proposals and we wanted to do them justice. I refer her to the statement.

Julian Smith (Skipton and Ripon, Conservative): Many people in Yorkshire who worked really hard to attract the Green investment bank to Leeds will be gutted by this decision. To compensate for this bad news, will the Secretary of State and his Department commit to giving the Yorkshire carbon capture and storage cluster as much support as possible over the coming months?

• Edward Davey : I know how hard my hon. Friend works to promote investment in his constituency and I am sorry that he is disappointed, but he will realise, as I am sure the whole House will, that the Green investment bank will be investing across the country and, therefore, driving our low-carbon economy.

Charles Kennedy (Ross, Skye and Lochaber, Liberal Democrat): May I unambiguously and warmly welcome-it will be welcome across the whole of Scotland-the decision to site the Green investment bank in Edinburgh? Does the Secretary of State agree that this will also give a further shot in the arm to other sites in Scotland, such as Kishorn in my constituency, that are pursuing renewable energy initiatives with great employment prospects? I congratulate the Government. This is a very good start for my right hon. Friend in his new post.

• Edward Davey : I thank my right hon. Friend for his welcome. He is right. Edinburgh is an established centre for financial services and it couples that skill with a thriving green sector. That is why I believe my right hon. Friend the Secretary of State for Business, Innovation and Skills has chosen it. I know that my right hon. Friend Mr Kennedy has been a champion of investment for Kishorn point and welcome the planned investment for redeveloping the point.

. .

Nadhim Zahawi (Stratford-on-Avon, Conservative): If he will make a statement on his departmental responsibilities.

• Edward Davey : This is my first departmental Question Time as Secretary of State for Energy and Climate Change. Since my appointment in February, I have been rather busy, following on from the successes of my predecessor. I have opened the world's largest offshore wind farm off the coast of Cumbria, launched the energy efficiency deployment office to help the Government deliver their energy efficiency policies, and published reforms to the feed-in tariffs scheme. In addition, the Department of Energy and Climate Change and Ofgem have published a report on cutting the costs of offshore wind connection.

Nadhim Zahawi (Stratford-on-Avon, Conservative): I welcome my right hon. Friend. Will he confirm that the Government are committed to exploring the full range of possible renewable technologies

-marine, tidal, geothermal and so on-as part of a portfolio approach to a mixed energy economy, which plays to the strengths of this country both economically and environmentally?

• Edward Davey : My hon. Friend is right that this country is blessed with huge potential for renewable industries. We can therefore seek a transition to the low-carbon economy, support energy security and build a green economy, which will benefit businesses, create jobs and increase our exports to the world.

Caroline Flint (Don Valley, Labour): The Labour Government committed £60 million to supporting manufacturing for offshore wind in this country. In October 2010, the Government promised to continue our scheme. Eighteen months on, when there are reports that manufacturers are holding off on investing in offshore wind in Britain because of uncertainty about Government policy, why has only one grant been awarded and why does 98% of the budget remain unspent?

• Edward Davey : The Government are supporting the wind turbine industry in this country. It was under the last Government that a factory closed, the Vestas factory in the Isle of Wight. The right hon. Lady needs to examine our record, which is very strong. We are seeing more and more investment in the industry.

Caroline Flint (Don Valley, Labour): I asked a pretty straightforward question. The Government have signed up to a £60 million budget, and so far only one grant has been provided. Why is that the case, and why does 98% of the budget remain unspent?

Twice this week I have asked the Government why they are failing to back British businesses, and twice they have had no answer. After his leaked memo, we now know that even the Business Secretary agrees with me. On Monday, I said:

"We have to do more to develop our supply chain and to support manufacturing in this country".-[Hansard, 5 March 2012; Vol. 541, c. 597.]

On Tuesday, the Business Secretary said that

"there is as yet little attention given to supply chain issues."

That is a straight quotation from his memo. Is not the truth that the Government's mixed messages and failure to get behind British businesses mean that jobs and investment in industries that could come to this country are now going overseas?

• Edward Davey : The right hon. Lady is wrong on this point. Many companies from around the world are looking to the UK as the premier place to invest in the offshore wind industry. She is talking down great places such as Hartlepool that want to attract investment in the industry. We are looking at the supply chain, and we have set up the offshore wind developers forum, which has pledged that 50% or more of the work in the supply chain will be in Britain.

Nigel Mills (Amber Valley, Conservative): Will the Secretary of State update the House on measures to support the training of installers, assessors and suppliers of green deal home improvements?

• Edward Davey : I am grateful to my hon. Friend for his question, because I have today announced £3.5 million to train green deal assessors, delivering on the Deputy Prime Minister's announcement last March of the creation of 1,000 green deal apprenticeships. That money will help hundreds of people gear up for the green deal and ensure that the scheme is a real success on the ground. I have also announced today £10 million of innovation funding to improve the energy efficiency of non-domestic buildings.

Paul Flynn (Newport West, Labour): Will the Minister congratulate the firm of Mabey Bridge in Chepstow, which was started last year? It has just doubled its work force to 200 and has a full order book for 35 wind power towers. Will he take this opportunity to denounce the doubters on his Back Benches and give a clarion call of support for wind as a job-rich form of energy that is British, eternal and clean?

Charles Hendry (Minister of State (Renewable Energy), Energy and Climate Change; Wealden, Conservative): The hon. Gentleman gives a perfect answer to Caroline Flint. That is an example of a company investing to take advantage of the opportunities that exist. I was delighted to be able to open the factory extension last year and to meet the company again last week. It is doing a tremendous job, and it is a great British success story.

Chris White (Warwick and Leamington, Conservative): In Warwickshire, we are fortunate to have many people who are seeking to design community-based renewable energy solutions, ranging from solar panels on public buildings to hydroelectric power. In the run-up to the Budget, will the Minister ask the Treasury to consider extending community investment tax relief to matters such as investment in community energy, which delivers both social and economic benefits? That could provide a significant incentive for people to invest in such schemes.

Gregory Barker (Minister of State (Climate Change), Energy and Climate Change; Bexhill and Battle, Conservative): I thank my hon. Friend. He, like me, is a great champion of community energy, but I am afraid he is tempting me down the path of forecasting the Budget, which is a somewhat career-limiting move for junior Ministers. I can say, however, that we have established a community energy contact group to discuss those issues, about which he knows I am particularly passionate.

Julie Hilling (Bolton West, Labour): Does the Secretary of State support WWF's earth hour on 31 March, when across the world, everyone will be encouraged to switch off lights for one hour to highlight the issue of climate change? What will he do to promote earth hour?

• Edward Davey : That is a very good initiative, and I can certainly commit my Department to supporting it.

Elizabeth Truss (South West Norfolk, Conservative): Many of my constituents are concerned about the number of proposals for biomass plants that are springing up in an area of high-value agricultural production. In these times of concern about food security, what steps is the Secretary of State taking to ensure that we do not use high-value crops in such plants?

• Edward Davey : The Government will not allow the growth of bio-energy to compromise food security. There are many other feedstocks for bio-energy, including wastes. Crops for energy can be grown in ways that do not compete with food, for example, through using marginal land. We want our farmers to share the economic opportunities offered by bio-energy as well as realising the benefits of clean, secure energy for the country.

. . Alan Whitehead (Southampton, Test, Labour): The Secretary of State has today informed us where the headquarters of the Green investment bank will be, but has he also broken the news to Edinburgh that it will host not a bank but a cash-limited fund until at least 2017? Does he intend to go to the Treasury on behalf of Edinburgh to seek permission for the green investment fund to become a bank substantially before that date?

• Edward Davey : I am surprised the hon. Gentleman talks down the bank. It has £3 billion to spend in this Parliament and will leverage in billions more of private sector investment. That is good news for our economy and for the transition to the low-carbon economy.

. . Barry Gardiner (Brent North, Labour): Green economic development will be the central focus of the United Nations conference in Rio in June. Given that, which Ministers will attend? Now that the Brazilian Government have changed the date to 15 June in deference to the Queen's diamond jubilee, will the Prime Minister himself attend?

• Edward Davey : I am grateful for the hon. Gentleman's question. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs is leading on our preparations for Rio. I know she will want other senior Ministers to accompany her.

• Full Debate in Parliament