Select Committee on European Communities Report


Letter from Lord Tordoff, Chairman of the Committee, to John Battle MP, Minister for Science, Energy and Industry, Department of Trade and Industry

  The above proposal was considered by Sub-Committee B at its meeting this morning.

  Your Explanatory Memorandum (EM), dated 30 January, states that the overall European Union target for gross inland European Union energy consumption from renewables by 2010 is "very ambitious" and that the Government are concerned that the Community should not commit itself to unrealistic ambitions. You go on to say that the Government intends to support the principle of action to promote renewable sources of energy but will "argue against the endorsement of any unrealistic targets and the adoption of measures which would impose disproportionate costs on consumers, industry or the taxpayer". Given that your EM states that "A Compliance Cost Assessment (CCA) has not been produced as the White Paper does not itself place any additional burdens on UK business", but that you estimate costs to be in the range of £1-3 billion per annum, the Committee would like to know how you arrived at that estimate, which in itself is very wide. Our understanding is that, following the adoption of a Resolution on the White Paper individual proposals produced will themselves be subject to scrutiny in the usual way. We would be grateful for your assurance that CCAs will be included with the individual EMs in each case.

  The Committee supports the Government's negotiating position on this proposal. Given that renewable sources of energy are not in all cases necessarily environmentally sound, we would urge the Government to encourage the Commission to undertake a more rigorous analysis of the debate on renewable versus non-renewables. We would appreciate being kept informed at the earliest opportunity of the outcome of discussions on this proposal at the 11 May Energy Council. In the meantime, this letter maintains the scrutiny reserve.

13 March 1998

Letter from John Battle MP, Minister of State for Science, Energy and Industry, Department of Trade and Industry, to Lord Tordoff, Chairman of the Committee

  Thank you for your letter of 13 March, concerning scrutiny of the renewable energy White Paper. I welcome the Committee's support for the Government's overall stance towards the White Paper proposals.

  You ask how I arrived at the estimate of £1-3 billion per annum as the UK's share of the cost of achieving the White Paper's target. The Commission's own estimate is that a total investment of £110 billion will be needed to achieve their 12 per cent target. This represents about £10 billion a year for the EU as a whole. The UK "share" of this clearly depends on the base on which it is calculated (for example, the UK share of EU GDP, EU energy consumption etc), but would on most bases give a figure in the range of £1-2 billion. However, if the UK wished to bring its renewables consumption closer to the EU average, a heavier investment would be needed. I provided an "estimate" of the possible cost to the UK, which is necessarily very crude, to give the Committee an idea of the scale of the investment needed and I hope this was useful.

  I did not submit a compliance cost assessment on the White Paper, but said that any specific proposals arising from the White Paper will be examined for potential burdens and subjected to a compliance cost assessment as appropriate. I am happy to give the assurance you seek that cost compliance assessments will be included with the individual EMs for all proposals flowing from the White Paper which impose a burden on business.

  I note the Committee's view that some renewable sources of energy can have adverse effects on the environment. You may be interested to learn that the ALTENER II programme to be launched later this year is expected to call for proposals for studies comparing the impact of traditional and renewable energy sources.

  The White Paper, together with the Commission's proposal for an Energy Framework Programme, will be debated by the Commons European Standing Committee B on 1 April. The Energy Council on 11 May is expected to adopt a Resolution on the White Paper and this was the subject of an OTNYR EM submitted to you on 16 March.

  I would be grateful if you could complete your scrutiny of both the White Paper and draft Council resolution in good time for the Council.

24 March 1998

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