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Ed Davey talks about Energy Bill on the Today Programme: Transcript

  • 23 Nov 2012, 15:30
  • Freya Roberts

Ed Davey explained what's in - and not in - the government's new energy bill on this morning's BBC Radio 4 Today Programme. Some of the finer details of the bill are also available in a statement by the Department of Energy & Climate Change. Our look at the media coverage of the announcement is here.

Below is a transcript in full of the interview between the host, Evan Davies, and the Energy Secretary, Ed Davey, which begins 2 hours and 11 minutes into the recording:

Ed Davey on the Today Programme

Davies: The big issue for most people clearly is their bill and I do want to talk about that in a moment because it is going to have implications for that. But lets just get some clarity first over what our energy future is, because we seem to be stuck in paralysis between a vision of sort of gas fuelled electricity sector and a perhaps more expensive but less emitting renewable and nuclear electricity future and i'm not clear we've really made up our mind about which way it is to be yet, are you clear about which we're going down, which route?

Davey: Absolutely, I don't think it's gas or renewables, I think you need both, and actually they can be very complimentary. Some of the renewables like wind and solar - wind doesn't always blow and the sun doesn't always shine, so you do need other types of energy generation. And therefore the mix is what's important, and having a diverse and balanced approach where you're not just putting all your eggs in one basket is the best way to: a) keep the lights on so you've got more security, and b) make sure you get the best prices.

Davies: Right, but just to be one hundred per cent clear, everybody's always accepted we're going to have gas there for standby for when the wind isn't blowing if we're using a lot of wind, but you're saying gas will play a part on top of that? a significant part in electricity in 2030 on top of any need to be just sort of reserve power in the background?

Davey: We've always said that, when Chris Huhne published the Carbon Plan to try to reduce our carbon emissions there was a clear part of the modelling which showed we'd need a lot more new unabated gas plants over the next two decades.

Davies: And we're going to get a gas strategy or a statement in the next couple of weeks as well aren't we? Is that going to sort of open the door to fracking, to finding the gas reserves under Blackpool and pulling them out of the ground?

Davey: Well I have to make a decision about whether Cuadrilla can continue its fracking there, and that's a sort of quite a judicial decision, and i'll be making that shortly. But i've been very clear and the chancellor's been very clear that shale gas does offer an opportunity to the United Kingdom.

Davies: Are we still entirely committed to the 2050 target, so the 80 per cent reduction on carbon emissions by 2050?

Davey: Yes, totally.

Davies: There's no target for 2030 as I understand it. Now the worry that some people have, and indeed it seems the Committee on Climate Change who are the official advisers on this appear to have a bit of a worry about this, is that if you don't have a target for 2030, you don't meet the target in 2050.

Davey: I think you're muddling up targets, there is a target for carbon emission reduction and we will have one for 2030. We've got currently four carbon budgets going up to 2027 and they show how the whole economy should reduce its emissions so we aren't polluting as much. There will be a fifth carbon budget which will cover the period 2028-2033, published in 2016 and at that time there'll be another target for the power sector, just the power sector.

Davies: But it's the power sector one everyone was saying you needed to hit by 2030, you almost needed to decarbonise the electricity sector by 2030 to be on course to meet the big one, the 2050 one, right, and that's the one you wanted and you had a big argument with the Chancellor about and you lost that argument.

Davey: Well I wouldn't characterise like that - we had a good negotiation and I think it's really important that two parties have come together and will be delivering the biggest boost to clean energy - we're doing it and labour failed as one party. But on the decarbonisation issue, lets be clear - we've agreed that we'll take a power in the energy bill so that the Secretary of State can set a decarbonisation target for 2030. That will help make sure we give confidence to investors, but we're going to set that target, not now, but in 2016.

Davies: After the election, basically?

Davey: Yes, but when we set the carbon budget which will cover the same period.

Davies: But it's the election that's the crucial thing there, isn't it. Because you're going to go into the election, and probably actually labour will too, according to Ed Miliband yesterday - you'll both go into the election saying we want a decarbonised... basically decarbonised the power sector by 2030. We get rid of all the carbon, its basically nuclear, renewable and gas in the background. That's what you'll go into the election promising, no?

Davey: Well I can't actually write the Liberal Democrat manifesto now but we do have policy passed this autumn which would commit the Liberal Democrats to a 2030 decarbonisation target. That would include all low carbon by the way - nuclear, CCS and all forms of renewables.

Davies: Indeed so. If I want to build a gas fired power station now, that's going to last 25 years, can I do that knowing it will be allowed to operate until 2040?

Davey: Yes.

Davies: So it will be allowed to operate until 2040? Even though...

Davey: Yes, that's always been the case. This is all about jobs, you know, we are going to see a massive increase in investment in clean energy and in gas, and in other parts of energy infrastructure - that's exactly what industry's been wanting, it's actually what the green groups want as well, and this decision today actually is going to unlock and unblock massive investment and jobs.

Davies: But the green groups are not as happy as you're suggesting, because you're suggesting it's all love and peace, and you're suggesting it's always been inevitable that it was going to be rough like this and this is what you wanted. But of course it isn't what you wanted, it isn't what your party wanted, it's not what your party suggested it wanted at its own conference, and there isn't a target for 2030 - that's delayed until after the election. Just to be quite clear about it.

Davey: Well, we've got a power for a decarbonisation target. We've got a huge amount of money that's going to go into clean energy, the investors and industry have been asking for this, and actually I think...

Davies: We've got some clarity, but not until after the election...

Davey: They've got a lot of clarity because we've got the carbon budgets already, we've got the Climate Change Act already. And what the green groups I think will see when they look at more of this detail is that this is a once in a generation change to our energy infrastructure, moving away from dependence on fossil fuels which you have to import from the other side of the world at increasingly high cost, so we go to low carbon and clean energy.

Davies: Reducing, but not eliminating. Right, I want to move on to bills very quickly because of course there are implications for bills and there are a lot of different figures being bandied around. We've got 7.6 billion being committed, per year, to expensive green energy by 2020. What do you think is going to be the implication of your energy bill for the average household?

Davey: At the moment, the biggest impact impact on energy bills is of course gas imports, its also the renewal of the transmission system. Much of the impact from government policies is actually on energy efficiency and on tackling fuel poverty. The impact from supporting clean technology is only 2% on people's bills at the moment. By the end of the decade that will grow, and by 2020 it'll be about 7%...

Davies: In today's money, does 7%... we're talking then about £170?

Davey: No, no we're not. Absolutely not. We're talking about under £100 in 2020. In 2012, today, we're talking just £20. The figures that are being bandied about are just, utter, rubbish. And if you take account of all our policies, which I think when you're talking about energy you should look at all aspects of the energy policy, and we are making measures on energy efficiency which will help people save money. If you look at our reforms of tariffs that I announced, that will help many people save money. And if you look at the net impact, which I know you as an economist, Evan, would want to look at, the net impact by 2020, the average saving for people will be £94. So actually rather than increasing bills, our green energy policies are going to reduce bills.

Davies: Just to get a figure for the green power surcharge, so to speak, the 7.6 billion translates into an amount below £100, per household, you say.

Davey: By 2020

Davies: By 2020. Ed Davey, energy secretary, thank you very much.

Transcript ends 2hrs 20mins into the programme

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