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Dr. Whitehead: This is another clause that originated in a Bill that, as the right hon. Member for Bromley and Chislehurst (Mr. Forth) will remember well, had a Second Reading a while ago, and has now been incorporatedI thank my hon. Friend the Member for Edinburgh, North and Leith (Mark Lazarowicz) for assisting in that processinto the Bill.
Dynamic demand is a system whereby a machinebe it a refrigerator, a freezer or a microgenerating devicethat is not necessarily to be switched on all the time can detect the difference in the current that is coming into that device. That means, and it is potentially very important, that where a current fluctuates it indicates the extent to which there is a load on the circuit in generalthat is, how much current is going around the grid and how much is therefore being supplied and used or not used. Where a machine is able to make use of current intermittently and switch itself off when it does not require that current, dynamic demand technology enables that device to do just that, and that would mean
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that if dynamic demand technology were to be made available on a widespread basis for machines such as that, it would enable the grid to operate much more efficiently. It would no longer be necessary, for example, to bring in coal-fired power stations for one hour in every three months to cope with a peak; that peak could be smoothed out as a result of dynamic demand technology judging by an intelligent device how that current is going and therefore whether that machine should draw that current off or not, or should export that current into the grid or not.
The cost of achieving that is absolutely minimal, inasmuch as all that is needed is to place in each device a small piece of electronic equipment, costing probably a few pence, which could be supplied with the device when it was installed. To all intents and purposes, therefore, it is not a serious cost in the way that the right hon. Member for Bromley and Chislehurst suggested. However, the benefits, as I am sure he would agree, are enormous in terms of energy use, not just in terms of the use of the grid, but in terms of the use of energy by the specific device. So the net saving in the generation of electricity in general and the use of electricity by the device that the person has installed in their house would be enormous.
Mr. Forth: I am grateful to the hon. Gentleman for his explanation. If the technology is that simple, if he knows so much about it, and if it costs only a few pence, why do we need a 12-month review by the Secretary of State to establish how wonderful it all is? Why do we not just get on with it anyway? Why do we need a rather elaborate clause to achieve all the things set out in it when he seems to know about the matter already?
Dr. Whitehead: As the right hon. Gentleman will imagine from the account I am giving, if the system is to work well, it will require the widespread installation of dynamic demand devices into various machines that could collectively make the change to the way in which electricity is used from the grid, or exported to the grid, to achieve the savings that I outlined. A report that sets out, for example, the collective changes in manufacturing protocols that might be necessary to place the devices in machines would be a good way of going about things. I would imagine that standards, arrangements and protocols on the stage at which the devices come on stream would be part of a report to investigate the potential for dynamic demand technology and the savings that could result from it. It would be prudent and appropriatepartly because of several of the points that the right hon. Gentleman makesto have such a report to ensure that the technology is implemented in a beneficial way, rather than a haphazard way that does not work at all. It is wise to suggest that a report making conclusions that would lead to the widespread establishment of the technology is produced in such a way.
Does the hon. Gentleman accept that such a report should include the provisions that my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) cites in his amendments?
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Dr. Whitehead: If the report was sensible, it would difficult for it to have no regard to such issues. However, it would, at the very least, be gilding the lily to provide in the Bill that the report should be written in a particular wayI am sure that the right hon. Member for Bromley and Chislehurst does not intend to gild any lilies in any way. On the basis of the fairly full, but succinct, information about the way in which dynamic demand technology will work that I have given, I hope that the right hon. Gentleman will agree that the provisions in the Bill for a report would be the best way to proceed and that it might thus be appropriate for him to withdraw the amendment.
Gregory Barker: The whole House has benefited from the short talk on dynamic demand technology by the hon. Member for Southampton, Test (Dr. Whitehead)we are all enlightened. Likewise, my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) made interesting and sensible points about the terms of reference of any possible report. If there is to be wide take-up of such useful technology, a report will be not only welcome, but necessary.
The technology would enable us to manage the relatively rare peaks that necessitate large generation capacity. In layman's terms, it would enable the fridges of the country to be turned off for a few minutes during the adverts in "Coronation Street" so that the nation could make its cups of tea, and thus negate the need for a large amount of electricity generation.
Mr. Forth: Does my hon. Friend think that only new appliances will be fitted with the device costing a few pennies, or does he envisage retrofitting, which, as I am sure that he will acknowledge, could cause complications?
Gregory Barker: I daresay that it would. I am sure that the question of new fit or retrofit costsmy right hon. Friend has raised that pointpay-back periods, methods of installation and the variety of manufactured installations would come under the scope of the sensible report that the Secretary of State would be required to commission under the terms of the Bill. I do not believe, however, that it is necessary to prescribe that in the Bill; nor do I believe that it would be consistent with the views of my right hon. Friend the Member for Bromley and Chislehurst, whom I have heard, Friday after Friday, lamenting the amount of prescriptive legislation that is brought to this House and put on the statute book. Like him, I believe in a light touch in this place, so that we legislate only for the absolute necessities of life.
Where it is possible for us to be anti-regulatory, we should be. Mindful of the good Tory principle that we legislate only where absolutely necessary, I am happy, on behalf of the Conservative party, to leave the Bill to direct the Secretary of State to commission the report. Given that these points have been fully aired by my right hon. Friend, I believe that they will be embraced in the report. I am mindful that we all need to keep our comments brief to ensure the Bill's passage.
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The amendment would require the Secretary of State, when taking a view on whether it was appropriate to promote dynamic demand technologies, to have regard to the installation costs of those technologies together with the resultant pay-back period. When forming a view as to whether action in a particular area is appropriate, the Secretary of State will ensure that all relevant factors are taken into account, including costs, benefits and pay-back periods. Therefore, the amendment is unnecessary. Amendments Nos. 73 and 74 are merely consequential to the incorporation of amendment No. 72. I oppose all the amendments.
Chris Huhne: We, too, oppose these amendments, essentially because it seems to us that the clause already contains provisions that encapsulate them. There is no point, as the hon. Member for Southampton, Test (Dr. Whitehead) said, in gilding the lily.
First, clause 15(2) says clearly that the Secretary of State should deal with what steps are appropriate. That, I hope, would include costperhaps I am betraying my economics background. Subsection (3) says that
and I should have thought that cost is clearly a factor that could prohibit or inhibit the use of such technology. Certainly, before I buy something I usually like to know the cost of it. It is unnecessary to proceed any further with the amendments, and we should reject them.
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