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Power Stations

Viscount Hanworth asked Her Majesty's Government:

The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, the timing of closures of existing stations is a commercial matter for the companies concerned. There is a wide range of technologies available already to meet future electricity demand.

Viscount Hanworth: My Lords, I thank the Minister for that reply. However, does he agree that there is a very limited number of stations, or types of stations, that can provide the type of energy that we are likely to need and that certainly no renewable form of energy is available? Therefore, does the Minister agree that we have the choice of coal, oil, gas or nuclear? Does not the noble and learned Lord think that nuclear is inescapable?

Lord Fraser of Carmyllie: My Lords, as I am sure the noble Viscount is aware, the nuclear review considered the costs and benefits of keeping the nuclear option open. It reached the view that it was reasonable to assume, even if no more nuclear power stations were

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built—and at present they are certainly not competitive in price terms with other fuels—that the existing technology would not be lost and that the option to build nuclear power stations would be available for some time to come. It may be after the year 2010 that that option emerges as a realistic one. But certainly, on present calculations, there would not seem to be a commercial basis for so doing.

Lord Jenkins of Putney: My Lords, do the Government have plans for replacing the present nuclear stations with renewable stations? As regards the stations which will be time-expired in 2020, what are the Government's plans for disposing of the consequences of having such stations?

Lord Fraser of Carmyllie: My Lords, although there are changes to come following recent announcements on the use of the non-fossil fuel obligation, the emphasis with regard to renewables will be maintained. Indeed, through the application of that mechanism, it is expected that of the order of £150 million per year will be the cost to the consumer of ensuring that a wide base of renewables is available. That seems to be an important way forward. Following on the third order, going from the second one, it would appear that, encouragingly, they are becoming more competitive.

Lord Mackie of Benshie: My Lords, is the Minister saying that the whole of the provision of power for the United Kingdom will be left to private enterprise, according to the degree of profit that may be expected? Alternatively, do the Government have any foresight at all as to the power required for the country?

Lord Fraser of Carmyllie: My Lords, as my original Answer indicated, the timing of closures of stations and particular fuels used will indeed be a matter for the companies concerned. Following the nuclear review, it appeared that there was no immediate, present justification for the building of a new nuclear power station. It is always difficult to predict how prices will move in the future. I indicated in an earlier answer that

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it is possible that some time after 2010 the matter might be reviewed. However, there does not seem to be any immediate proposal to do so.

Lord Mackie of Benshie: My Lords, is not that a matter for the companies concerned?

Lord Fraser of Carmyllie: Yes, my Lords. I think I have now made it clear for the third time that it would not be a matter that the Government would advance.

Viscount Mersey: My Lords, I think my noble and learned friend has said that nuclear power is expensive. How does he square that with the fact that we are importing so much cheap nuclear electricity from France?

Lord Fraser of Carmyllie: My Lords, the generation of nuclear energy using nuclear power stations in this country is expensive and it is quite clear that gas is a cheaper option. So far as one can ever predict these things with any absolute certainty into the future, that appears to be the likely case. There continues to be access to large gas supplies; indeed the reserves now available are probably as great as they were in 1980.

Lord Stoddart of Swindon: My Lords, in any future energy policy, will a great deal of attention be paid to conservation? Does the Minister agree that when building power stations, whether they be powered by gas or coal, due account should be taken to ensure they are small enough and localised enough to use the combined heat and power option?

Lord Fraser of Carmyllie: My Lords, that is certainly an attractive option where it can be introduced. The noble Lord will appreciate that there are a number of circumstances where just that approach is being taken. Similarly, where renewables are being introduced, in the main they tend to be on a rather smaller scale and one hopes that in those circumstances greater advantage can be taken of the generation beyond simply the production of electricity.

Lord Jenkins of Putney: My Lords, if the House will permit me, will the noble and learned Lord be good enough to answer the second part of my supplementary question in which I asked what is being done to make sure that when the present nuclear reactors expire they do not become a menace to everyone around them?

Lord Fraser of Carmyllie: My Lords, if the noble Lord would like to sit around for the later part of this afternoon when we discuss the Atomic Energy Authority Bill, he will appreciate that the one part that will remain within government control is the licensing and the decommissioning of nuclear power stations. However, we can doubtless expand upon that at length later this evening.

Lord Peston: My Lords, I interpret the noble and learned Lord's answer to be essentially that our generation is now entirely within the private sector. Therefore he seems to be saying that it is no business of the Government's at all; in other words, the Government have ceased to have an energy policy. Will he confirm that that is what he said and that that is now the

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Government's position? Will he also confirm therefore that all the civil servants who used to work for his department in the energy division, who were previously, I believe, in the old Ministry of Energy, have left as well and that at least we have had some corresponding savings for the Government's abandonment of 50 years of policy in this area?

Lord Fraser of Carmyllie: My Lords, I do not accept that that is what I said. If that is what the noble Lord understood me to say, I must renew what I was saying. As regards the non-fossil fuel obligation, there is a clear continuing desire on the part of government to use that to stimulate the market in those renewable technologies which we hope in the years to come will increasingly play an important part in the provision of electricity in the United Kingdom. That remains clearly part of our obligation but otherwise, generally speaking, the selection of a particular fuel for the generation of electricity is indeed one for the companies involved.

Railway Passenger Franchise Bids

2.47 p.m.

Lord Peyton of Yeovil asked Her Majesty's Government:

    Whether they will instruct the franchising director, in assessing the first bids for railway passenger franchises, to make a comparison in each case with the cost of British Rail continuing to run the services, and to publish the results.

The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen): No, my Lords. Under the Railways Act these are matters for the franchising director.

Lord Peyton of Yeovil: My Lords, does my noble friend accept that I am able on this occasion to restrain my gratitude for that Answer, even though it was hardly surprising? Why is that the case? This information must be readily available and would be useful and interesting in order to make it possible to follow the processes of thought of the franchising director, or perhaps he is affected by coyness on this subject.

Viscount Goschen: My Lords, I understand from the franchising director that, as part of his assessment of passenger franchising bids, he will be making a comparison between the bids and the cost of BR continuing to run the service, and therefore an instruction would not be necessary. The second part of my noble friend's Question concerns publication. The franchising director is unlikely to be able to publish the results of his comparison because much of the material involved would by its very nature be commercially sensitive.

Lord Clinton-Davis: My Lords, does not what has happened as regards the blocking of British Rail's application for a franchise indicate quite clearly that there is no accountability to Parliament on this issue; and that what the franchising director has done is quite

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flagrantly to breach the will of Parliament, which was to enable British Rail to enter freely into applications for franchises which he is now evidently denying?

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