Energy Bill [Lords] — House of Commons, 2016-03-14
Topic: Energy
Andrea Jacqueline Leadsom (Conservative, Centre-right): Before dealing with other proposals, I would like to speak to Government amendment 50. As I made clear during our last debate on this issue, I would like to see an equivalent approach taken right across the UK to the early closure of the renewables obligation to onshore wind, to provide consistency to industry and to protect consumer bills. Amendment 50 relates to clause 81—the backstop power regarding Northern Ireland In Committee, I introduced a clause with a view to protecting consumers in Great Britain from the costs of any additional support that Northern Ireland may decide to provide to onshore wind. I remind hon. Members that the clause received considerable support at that stage and that it is a backstop power—this is to say, it is intended to be exercised only if Northern Ireland decides not to close the Northern Ireland renewables obligation scheme to new onshore wind on equivalent terms to those in Great Britain The new amendment simply clarifies the drafting of the clause to ensure consistency with the provisions relating to the early closure of the renewables obligation in Great Britain by making it clear that the power in clause 81 extends to capacity added to existing onshore wind stations, as well as to new stations. I should highlight that the intent behind the clause has not changed at all I thank all hon. Members for their comments on the non-Government provisions. A number of them—specifically amendments 1 to 21, tabled by the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell)—were discussed in some detail and at length in Committee. As far as I can see, the amendments have not changed at all since we last discussed them. Following our agreement not to include them then, the hon. Gentleman has tabled them here once again To ensure clarity for hon. Members who did not attend the Committee debates and to move forward with this debate, and indeed the Bill, I am happy to set out the Government’s position again. I will first remind hon. Members of the intended effect of clauses 79 and 80. Clause 79 implements the early closure of the renewables obligation to new onshore wind in Great Britain. Clause 80 sets out the grace period conditions under which certain projects may continue to accredit beyond the early closure date Let me be clear: the Government remain committed to delivering our manifesto pledge to end new subsidies for onshore wind, and I am grateful to my right hon. Friend the Member for Wokingham (John Redwood) and my hon. Friend the Member for Daventry (Chris Heaton-Harris) for the clear support they expressed. The Government are, however, also conscious of the need for industry certainty. Therefore, in response to the question from the hon. Member for Southampton, Test (Dr Whitehead), I would like to make it clear that, if Royal Assent for the Bill goes beyond 31 March, the Government intend the provisions to come into force from the date of Royal Assent and do not intend to backdate them. I reiterate that there is absolutely no change to our commitment to end new subsidies for onshore wind, and our actions have shown that we will be tough on subsidies to keep bills down for families and businesses Onshore wind has deployed successfully to date. Based on our analysis, and taking early closure of the renewables obligation into account, we still expect the deployment of onshore wind to fall within our electricity market reform delivery plan projections of 11 to 13 GW by 2020. That is our best estimate of what is needed to meet our 2020 targets and of what is affordable under our low-carbon spending cap When we announced early closure on 18 June, we made it clear that it was appropriate to curtail further deployment of onshore wind, balancing the interests of onshore wind developers with those of the wider public. As I explained in our earlier debates, the grace period conditions in clause 80 were developed following extensive stakeholder engagement and have been designed specifically to provide certainty and clarity for industry. In particular, we engaged in detail on the core grace period conditions, referred to as the "approved development condition" in the Bill. This requires projects wishing to accredit under the RO beyond 31 March 2016 to provide evidence that, as of 18 June 2015, they had, first, relevant planning consents; secondly, a grid connection offer and acceptance of that offer, or confirmation that no grid connection is required; and thirdly, access to land rights Following further industry engagement and analysis by my Department, the Bill’s provisions have been improved in a number of ways: first, to capture those projects that had a planning application refused on or before 18 June 2015, or where the relevant planning authority failed to determine a planning application where a decision was due by 18 June 2015, and which are then subsequently granted consent on appeal; secondly, to introduce an "investment freezing condition" allowing certain projects that qualify for the grace period an additional nine months in which to accredit where they have been unable to secure debt funding due to legislative uncertainty; and thirdly, to provide that the existing grid and radar grace period will continue to be available so that projects that have suffered delays outside their control in this area will have a further 12 months in which to accredit Let me take a moment to reflect on the important point about investor confidence. The Government believe that the early closure and grace period provisions that we have presented within the Bill strike the right balance between protecting investor confidence and ensuring our ability to control costs under the levy control framework.