Energy Bill

I am pleased to follow the hon. Member for Sherwood (Paddy Tipping). I agreed with much of what he said, but I will be supporting the EPS. I do not consider myself to be a vertebrate or whatever—I am a very cautious person—but we need to pin things down. In introducing this debate the Minister talked about the need to decarbonise the energy supply. I do not think that anybody in the House would disagree with that. I agree entirely that we have got to get CCS to work. Coal and gas are important to our current energy supply and are likely to remain so for the foreseeable future, so CCS is vital. Indeed, I am pleased to see that there will be a change, with gas perhaps being allowed later. However, if we are to persuade people of the need to pay for CCS, we will have to show results. Much has been said about investment today. The CBI has sent me—and, I am sure, every other Member—its paper on investment, which says:""An EPS could deter investment in CCS which would have an adverse impact on energy security"," and continues:""Introducing an EPS risks the unintended consequence of diverting investment away from UK clean coal, and towards CCS projects in countries where the risk profile is lower."" That is a point of view, but as was pointed out earlier, there is one thing being done in this country that is not done elsewhere, and the Minister said it herself. No other country has a statutory funding mechanism. She has talked about £9.5 billion from the levy for four demonstration plants. That is a considerable amount of the investment that will be needed for those four plants, but the money will not come out of thin air; rather, it is money from the levy on the energy companies, the cost of which will be met by the consumer at the end of the day. We are therefore talking about giving £9.5 billion of consumers' money to the energy companies to demonstrate CCS, and possibly also for retrofitting. Earlier the hon. Member for Cheltenham (Martin Horwood) mentioned the increasing scepticism about climate change shown in polls of late. However, another type of scepticism is increasing, and that is scepticism among energy consumers, who are being asked to bear more and more costs, for environmental issues, helping with the grid and so on. As we are in a period when wages are not rising and are not likely to rise for the foreseeable future, yet energy bills continue to rise, and more and more is being put on those bills, there is a squeeze on the energy consumers who pay them. If we are going to take consumers with us down this route, we have to convince them that we are getting value for money for the huge amounts that we are putting into CCS and other things. One way to do that is by putting the EPS in place. I understand the point that the hon. Member for Sherwood made about timing, and he is right. A year is a short time when we are talking about CCS, which we have talked about for many years but have never really got off the ground, for various reasons that I could go into at length, but will not. We have to show the consumer that we are putting real pressure on the companies to perform, to ensure that the money is well invested, that we will have a CCS system that works and reduces carbon emissions, that the cost is worth while for reducing the long-term emissions into the atmosphere and for helping to meet our challenging targets for carbon emissions reduction. I understood the points that the Minister was making earlier, and I do not disagree with a lot of them, but the reality seems to be that the only new coal plants that will come into being in the next few years will be those sanctioned through the levy. No one in their right mind will operate a coal plant without the levy. To digress slightly, we talked about gas earlier, and I made the point in Committee about the terms of the national planning statement in England, which I think will prevent new gas plant from being developed. We took that up with the Minister, Lord Hunt, when he appeared before the Committee, and he promised to look into the matter again. This needs to be sorted out, because it could stand in the way of the development of gas plant. The EPS will show a determination to ensure that consumers are getting value for money and that they are actually going to get somewhere with these companies. It will show that we are not just giving them money to build new plant. This brings me to my worry about new clause 8. I do not doubt the Minister's sincerity on the new clause. I do not doubt that the Government intend its effect to be that, in reviewing the measure in future, we will consider an EPS if we are not making fast enough moves towards decarbonisation. To me, however, that is not what the new clause actually says. The new clause says that we will look at""whether coal-fired generating stations for which appropriate consent is given on or after 1st January 2020 that are built in Great Britain can be expected to be constructed so as to enable use of carbon capture and storage technology on all their generating capacity"." Subsection (3) then says:""A report under subsection (1) must also include a review of whether, having regard to the other matters contained in the report, any government policies should be revised"." It does not talk about whether policies should be strengthened, or whether we should consider introducing an EPS; it simply talks about whether they should be revised. We should bear in mind the fact that by that time the energy companies will have invested money in the plant, and the Government will have invested £9.5 billion—perhaps a lot more. If, disastrously, carbon capture and storage is not working economically, there will be massive pressure on the Government of the day. Let us remember that 2020 is two Parliaments away, and with the best will in the world, whatever happens later this year, the Minister is unlikely still to be in her post—no offence meant to her, of course. In those circumstances, there will be massive pressure on the Government of the day to allow the plants to continue to operate without CCS because of the money that has been put in, and because of the effect on the energy system if they were taken out of commission. For all those reasons, it seems perfectly sensible—indeed, absolutely essential—that we make it clear to the energy companies from the outset that there must be an emissions standard and that they must meet it. We are putting this money in to help us to achieve our carbon reduction targets, and if we do not do that, there is real dangers ahead. I also suggest that we would have grave difficulty in convincing the energy consumers—who, ultimately, are paying for all this—that that is the right thing to do. I will support the emissions target tonight, and I hope that the measure goes through. I foresee great difficulty if it does not.