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22 Oct 2002 : Column 225—continued

Mr. Kevin Hughes: Coal has a future; it has a key role in our energy supply. It can produce fewer emissions with the use of the new-generation clean-coal technology that could come on stream with some support and help from the Government. My hon. Friend rightly points out that we need to maintain diversity. Any sensible Government must do that.

Mr. Robinson: I entirely agree with my hon. Friend, and I am grateful for his intervention. Coal is seen as old technology that has to be subsidised; nuclear technology is new, yet subsidy is implicit in its use. What price do we want to pay?

What of security? If the House decided that the free market should reign and that we should again let loose the dash for gas that we halted in 1998, we would be 90 per cent. dependent on gas within 20 years. I do not believe that we can obtain much more than 10 per cent. from renewables. However, even if we get 15 per cent. of our energy from renewables by 2020, we will still be 85 per cent. dependent on gas. Where will it come from? What security will there be? I mean no disrespect to the gas-producing countries, but there are thousands of miles of pipeline. Countries that do not have—

Gregory Barker rose—

Mr. Robinson: I am aware of the hon. Gentleman's views and although we are under time restriction—[Hon. Members: XNo".] Very good. I shall give way in a moment—

Dr. Alan Whitehead (Southampton, Test): Will my hon. Friend give way?

Mr. Robinson: I shall give way to my hon. Friend, too.

The argument was made at the Treasury in the past: how can we let this country become 90 per cent. dependent on gas that travels thousands of miles from countries that are subject to political turbulence, to put it no more strongly than that? That scenario is not acceptable. Rather than letting the free market—although it would not be entirely free even in that context—hold sway, this country would do much better to plan. I hate to use the word Xplan" because I know that it is anathema to both sides. However, we need an arrangement or a scheme to provide a balanced source and diversity of energy supply.

Gregory Barker: The hon. Gentleman looks to the future by as much as 20 years, yet the solutions to our

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energy problems have been distinctly 20th century. He has made no mention of fuel-cell technology or combined heat and power. Surely, we should be investing in new technologies such as those, and breaking the grip of large-scale generators, rather than trying to project 20th-century solutions on to 21st century challenges.

Mr. Robinson: On the contrary, I think that I have something of a reputation for being a pioneer in new technologies—new industry. I believe, though, that one cannot be totally dependent on their coming off. That is one thing on which we cannot depend. One can plan on the basis of one's coal reserves, knowing what they are and being reasonably sure of extraction and production rates. We do not know so much about the new technologies, in which, as I am sure my hon. Friend the Member for Eccles (Ian Stewart) would agree, we must invest more. We must move towards fusion and so on. What we cannot do is count on technologies being available in future and close down what is available to us now.

Dr. Whitehead: Does my hon. Friend accept that one cannot rely on market mechanisms alone to ensure the future of energy supply—that, almost uniquely, requiring renewables to come to market by predominantly market mechanisms is not a logical part of a future energy policy?

Mr. Robinson: I agree with my hon. Friend entirely. I believe that it is a desirable part of a future energy policy, and I would support those new technologies, as all Labour Members do. The Liberals support them in theory, but—as always with the Liberal party—not in practice. We have to put in place every mechanism that is available to us to help the new technologies succeed in due course. But what I cannot do, and what I am sure, in light of his intervention, my hon. Friend would not do, is to base the security and diversity of our supply on their realisation.

Mr. Tynan: Will my hon. Friend give way?

Mr. Chaytor: Will my hon. Friend give way?

Mr. Kelvin Hopkins (Luton, North): Will my hon. Friend give way?

Mr. Robinson: I give way to my hon. Friend the Member for Hamilton, South (Mr. Tynan).

Mr. Tynan: On the question of new technology, does my hon. Friend accept that as regards nuclear waste, there is an urgent need to ensure that we invest in technology that can deal with our present problem; and that if we do, we should not necessarily agree that that would open the door for nuclear energy to be used as a fuel in the future?

Mr. Robinson: I agree with my hon. Friend, and I think I accept what the chief scientific adviser to the Department of Trade and Industry said: broadly speaking, in the absence of any immediately credible alternative to nuclear fuel, we have to see that nuclear fuel, at 20 per cent. approximately, is replaced by

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nuclear fuel. That is the position that we come to. We must have a big national debate on that, focused on the House and decided on in the House. I noticed that the Tory party was agnostic in its approach, although I suspect that its Members agreed with me that the option has to be decided one way or the other, because if it is left open for ever while the reactors close down, it is clear to everyone that one no longer has an option.

Mr. Chaytor rose—

Mr. Hopkins rose—

Mr. Robinson: I give way once more, but I do not think that I should give way again after that.

Mr. Hopkins: I listened with interest to my hon. Friend's speech and agree with much of what he is saying, but I was disappointed by his slighting reference to planning. Some 22 years ago I was co-author of a document called XA Planned Energy Policy" for a fine trade union called NALGO. I think my hon. Friend would agree that had we followed a planned energy policy for the last 22 years, we would not be in the mess that we are now in.

Mr. Robinson: I am grateful to my hon. Friend. I was not suggesting that I had changed my spots over the past few years. I still believe that in certain areas, planning is a very sensible thing to do. We have not always got it entirely right in the past, but I am sure of one thing—that in energy, a sensible Government overview of the whole situation and a sensible principle that will guide the decisions that we take, are essential.

I shall now discuss the immediate crisis, which is the occasion of our debate. The transfer of the liabilities—the legacy—must be carried through in the next Queen's Speech. The agency must be set up. These are things that we all, as Governments and consumers, have accumulated and inherited. The agency must be set up, to enable us to move to a new situation in which there is a solvent British Energy. That too will require a very sensible, commercial approach to dealing with what will be left of British Energy, together with BNFL.

I put this concept to the Minister. There is a possibility, admitted throughout the House—even by the Liberals, who say that we should continue research into it—of an ongoing role for nuclear energy. It is well known that BNFL owns Westinghouse, has the licence to generate electricity from pressurised water reactors and has created 200 power stations throughout the world. The Minister and the Government should therefore consider bringing together BNFL and British Energy in a new public-private enterprise, in whichever way one wants to structure it and in whichever of today's acceptable terms one wants to define it, so that they can be shorn of the inherited liabilities and free to make their case to join in a role—the House must decide if there is one—for nuclear energy in the future.

9.20 pm

Mr. Michael Jack (Fylde): The hon. Member for Coventry, North-West (Mr. Robinson) made some important points about the way in which the electricity

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generation market and the pricing thereof has developed over time, but I want to spend a few moments saying a few words on behalf of the 1,500 nuclear energy workers at BNFL Salwick in my constituency. With the exception of the fuel for the pressurised water reactor at Sizewell, they make all the nuclear fuel in this country. If some of them had been in the Public Gallery tonight, they would have scratched their heads in disbelief, particularly at the terms of the Liberal Democrat motion, given that it simply expresses concern, without giving an opinion, about the very proper action that was taken to safeguard British Energy's short-term future.

The Liberal Democrat motion also refers to the so-called competitive market proving that nuclear-generated electricity is uneconomic and also generates long-term environmental costs. Neither in the motion, nor with great clarity in the remarks made by the hon. Member for Twickenham (Dr. Cable), was any serious comment made about energy security, carbon dioxide emissions or a proper, sustainable balanced energy policy—all of which are vital to the United Kingdom.

Although the Minister was excellent in his scathing denunciation of Liberal Democrats' equivocation and double-dealing in their policy statements, the Government motion is equally unclear on the industry's future, which affects so many of my constituents. It says that it:

At the heart of our nuclear policy lies a publicly owned company—BNFL. It is very much the key to some of the issues involving the disposal of the waste of the nuclear electricity generating business, but there is not much mention of that in the Government motion.

One company's difficulties do not necessarily make a policy, but the Minister touched on the new electricity trading arrangements. That illustrated the important failure in the Liberal Democrat motion to acknowledge that Governments have effectively determined the market for electricity and its price in the United Kingdom since the end of the second world war.

To return to the remarks made by the hon. Member for Coventry, North-West, if the previous market had some failings, one must acknowledge that there may be something wrong with NETA. If a company such as British Energy, which turns over #1.9 billion a year, is effectively on the brink of not making any profit and having to be shored up by a Government loan, given the disparity between the receipts from the sale of the electricity and its wholesale price, there is, as they say, something wrong in the state of Denmark, which ought to be investigated without delay.

Those of my constituents who are involved in the manufacture of nuclear fuel have observed that the current market arrangements lack any serious long-term underpinning. The base load characteristics of nuclear electricity generation are not properly recognised in the present market arrangements.

To put it very simply, we have to decide whether this country wants to enjoy what it has been happy to enjoy until now—a balanced electricity portfolio including coal and nuclear energy, which is under our direct control, and gas, which is questionable because it comes

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from more volatile and less secure sources of supply, as was mentioned by the hon. Member for Coventry, North-West.

If we want to keep those issues in balance, we had better quickly reach decisions about the future disposal and legacy of nuclear waste, about the right pricing model to ensure that the base load characteristics of nuclear energy are properly recognised and about the need for some long-term assurances to enable planning to take place, for example, with the improved technology of the AP1000-type generator, which would certainly be more economic and efficient in the future.

The nuclear fuel workers in my constituency have striven to improve their operation and to reduce their production costs. They have an excellent safety record. As a company, they have taken full cognisance of their environmental responsibilities, yet their prospects seem deeply uncertain.

Everyone who speaks in the debate will wish to acknowledge the important role of renewables. However, with the kilowatt hour charge for landfill gas of between 2.5p and 3p per kilowatt hour, for wind of between 4p and 5p and for renewable crops of between 6p to 8p, we are considering important economic developments, but at a cost. With energy, we cannot have our cake and eat it.

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