---

Lord Dixon-Smith: My Lords, I enter this series of debates, promoted by the noble Lord, Lord Tombs, with considerable trepidation. The debates have been going on for a number of years, and this is the first in which I have sought to take part. I want to talk about the subject from a slightly different perspective.

Like my noble friend Lord Jenkin, I was pleased to see the briefing from Ofgem, which it kindly supplied for the debate. I was interested to read it, but when I did so I was disappointed. As my noble friend said, the document is essentially short term. It makes no mention at all of global warming and the problems of carbon dioxide generation.

One has to assume that that is outside the context of the work that Ofgem does. But I had always assumed that the work that it does was established by the Government. My fear is that the subject is outside the perspective and time horizon of the Government themselves.

I hope that that is not the case. The Prime Minister pays lip-service to the problems created by global warming, although there are doubts from some of his recent remarks on whether his devotion to the subject is as keen and clear as one would wish. The subject is very important. The only mild genuflection in that direction is a passing comment about 185 megawatts of wind generation at present on stream.

What is the situation if we look at the problem of global warming from the global perspective? Carbon dioxide is currently at 375 parts per million in the atmosphere, as measured by the Mamalahoa observatory in Hawaii. It was 280 parts per million a century ago. There appears to be an increasing problem because, for the past two years, instead of going up at one part per million, which the century's progression implies, it has been rising at more than two parts per million per annum.

Against that is a growing scientific consensus that the upper limit at which we ought to accept the growth of carbon dioxide in the global atmosphere is probably somewhere around 500 parts per million. Beyond that, there is a point at which the consequences become wholly unpredictable. Certainly, 550 parts per million is probably when the safety valve bursts. If you put two parts per million into the time interval, we have 70 or 80 years to solve the problem. In the context of the electricity supply for the next five years, that may seem a long time. However, in the context of the strategic decision mechanism of the noble Lord, Lord Tomlinson, it is a remarkably short time, because we do not have such a mechanism.
 
19 Jan 2005 : Column 834
 

I have considerable scepticism about the Kyoto agreement. The noble Lord, Lord Bridges, says that devotion to Kyoto cannot be allowed to interfere with our national energy security; I took it that that was what he was really implying. I am afraid that I take a rather different view—that we cannot avoid and escape from the consequences of what is happening globally so far as CO2 emissions are concerned. The Kyoto agreement now in place is the only game in town. If it works—there is an if—something more than 480 million tonnes of carbon dioxide emissions per year will be saved by 2012.

In that time China has 562 coal-fired power stations planned but not all approved, while India has 213 planned but not all approved. The United States has not helped us—it ought to know better—as it has 72. If those power stations come on stream, they will produce more than 2,500 million tonnes of additional carbon dioxide emissions per annum, five times the saving that Kyoto will achieve. The arithmetic is deadly. Its relevance to today's debate is that the need to reduce carbon dioxide emissions must be a paramount priority in everything that we do for increased generating capacity.

Lord Bridges: My Lords, will the noble Lord allow me to correct a remark that he attributed to me? I think I said not that we must obediently disregard Kyoto, but that we should apply it with some caution. My argument at the moment is that that is not being done. It is being taken as something engraved in tablets of stone, and we have to get on with it and think of something else. Maybe we do, but we have rather more flexibility than he suggests.

Lord Dixon-Smith: My Lords, I apologise to the noble Lord if I tightened his remarks, but I am afraid that I was trying to say what he has just said in a much more brief way. If that was inaccurate, I apologise.

If carbon dioxide emissions are the priority concern, replacing coal with gas is not an option because they are both carbon dioxide emitters. Although one is better than the other, it is still part of the problem. Where do we go? The noble Lord, Lord Ezra, has for a long time been an advocate of carbon dioxide sequestration—so-called clean coal technology. It is proposed that two of the new American power stations will have that built into them during their construction.

The success of the process is not guaranteed and the costs are unknown, so we need to be wary of that. Certainly a major effort needs to be put into that if it is to come forward. My own feeling is that, unless carbon somehow becomes a raw material for the materials industry, it will not succeed. Simply burying it may be a short-term solution, and so-called carbon sinks producing more trees may give us a 50-year time relief, but that is about all. Once the tree is mature, it stops absorbing more carbon. That means that we need to move on.

One of the questions that one has to ask in all this is what would happen if the £30 billion subsidy that the wind industry received were reapplied to other more reliable sources of energy, such as the Severn barrage
 
19 Jan 2005 : Column 835
 
or, indeed, a Thames barrage. Such a barrage is now being talked about as flood protection for London, with no mention of its energy-generating possibilities. I find that odd. The noble Lord, Lord Palmer, will talk about alternative crops so I shall say nothing about that, but they will make a contribution. I merely observe that one can extract rather more energy from solar power per acre, using solar panels, than you can with plants.

It was the noble Lord, Lord Flowers, who remarked to me one day when I worked with him on the Science and Technology Committee that, in fact, we have only one source for our energy—nuclear. The question is whether we have nuclear generation 98 million miles away or here. It is worth remembering that all the hydrocarbon fuels that we consume are the product of solar energy built up over immense periods many millennia ago, and are being burnt off at a rate of knots.

All the other factors—energy conservation, combined heat and power, heat recovery and so on—will have to contribute. What do we see? We see little progress and little leadership or urgency from the Government. If the facts are uncomfortable, we push them out of sight if that can be done. On this issue, the Government are putting party politics before national interest.

Lord Palmer: My Lords, it is with great trepidation that I rise among a distinguished group of speakers. I do so as a farmer and the unpaid president of the British Association for Biofuels and Oils, more commonly called BABFO. For years I have been concerned about all our energy supplies, most especially where fossil fuels are concerned. I, too, am grateful to my noble friend for his excellent introduction to the subject. I am a new recruit to his loyal band of followers on their annual outing, although I did have my trials and tribulation during the passing of the Energy Bill. As by far the youngest member of tonight's band, I have become more and more depressed as speaker after speaker has warned of the dangers we are likely to face in future.

The problems of gas have been mentioned tonight. With oil at around 50 dollars a barrel, we ought to be urgently seeking alternatives—and so desperately need a cohesive strategic decision mechanism where the electricity supply industry is concerned. This is where I feel the role of renewables can be very useful. The Government's strategy to replace electricity generation from fossil fuels by low-carbon alternatives is in tatters. Leaving aside wind, which many noble Lords have mentioned tonight, and which is no more than partly replacing nuclear in all its unsightly placings—let alone its heavy subsidy—the biomass alternative has sadly been little short of a fiasco.

BABFO warned years ago that unless a proper commercial strategy were put in place, the effort would be wasted. It is tragic to think that after several years and nearly £100 million of research and development—yes, £100 million—that is has effectively been written off. The
 
19 Jan 2005 : Column 836
 
total area of relevant energy crops is hardly more than 1,000 hectares out of a total of 6 million. What a terrible waste of £100 million and, indeed, of land.

Farmers are in fact feeding the nation with half a million hectares which are set aside, wasted, idle and out of production. One obvious use for this land would be for biofuels, but there are biofuels and biofuels. For some extraordinary reason, Defra bureaucrats seem to have an infatuation with specialist biomass crops. The noble Lord, Lord Whitty, has recently announced a further £3.5 million of sweeteners for biomass. I had naively believed and hoped that the role biomass could play had been properly evaluated, especially bearing in mind the time taken for a biomass crop to come on stream, in comparison with the fuel use for a nine to 11-month growing crop such as sugar beet, wheat and oilseed rape. It must not be forgotten that energy from biomass crops costs a lot more than energy from fossil fuel.

We have already had the disaster of ARBRE. Until the actual costs of energy from these crops is known and the gap with fossil fuels known and bridged, I fear that Defra's dalliance with willow, grass and waste is doomed to fail. Liquid biofuels are different. They come from existing crops, they use known technology and have been fully costed. One must not forget that our current energy requirements are prone to unknown market forces all from increasingly unstable parts of the world, with no long-term supply guaranteed, let alone the volatility and fluctuation in price. The noble Lord, Lord Tomlinson, made this point most effectively.

It is also worth reminding your Lordships how relatively clean biofuel crops are to burn. I believe they have an important part in helping the Government to meet their Kyoto targets. Farmers are ready and willing to help Her Majesty's Government, which would in turn help their ailing industry.

Why do Her Majesty's Government not fund, for example, a small trial of biofuel plant to supply the National Grid? It would not be horrifically expensive. Farmers need help, guidance and a sympathetic ear from the Treasury. They could so easily play a significant role in a realistic and successful electricity industry. I urge the Government to seize the opportunity, before it is too late.

---