Energy Policy
Good morning. The first item of business is a debate on motion S2M-3543, in the name of Richard Lochhead, on energy policy. Mr Lochhead, you have 14 minutes.
Thank you, Presiding Officer. I shall use my time to make a number of good points. It is a pity that the Government and Tory seats are so empty for a debate that is important to the future of Scotland, but I take great pleasure in opening on behalf of the Scottish National Party.
As a result of the rise in global demand for energy, rocketing fuel prices, the fact that the United Kingdom is becoming a net importer of gas, international instability and global warming, energy issues increasingly dominate the headlines in Scotland, in Europe and internationally. That is because our standard of living depends on plentiful, accessible and affordable energy. We produce energy to heat and feed ourselves, to travel and to go about our daily lives. We know to our cost that countries will go to extreme lengths to secure access to energy supplies—indeed, they will go to war.
We in Scotland must turn our attention to our energy future. In the 21st century, the success of our economy will depend on our ability to find, produce and distribute energy and its major by-product, electricity. As we speak, Scotland is at an energy crossroads. The SNP believes that we need a Scottish energy strategy to guide us and ensure that we take the right road. We need to decide how and where we want to produce our energy and how much we need to produce. We also need the right information so that we can make informed decisions. The last thing that we need is a haphazard, ad hoc series of energy developments with no reference to any national energy strategy or policy. Indeed, the Enterprise and Culture Committee called for such a strategy in a recent report published under the convenership of my colleague Alasdair Morgan.
Scotland is a lucky country. We have abundant energy resources and we have cutting-edge energy sectors, but we need a Scottish energy policy to ensure that those resources work for the benefit of the nation. We need to protect and grow our energy sector. However, we must recognise that a dark cloud is hanging over one of our two major power companies, with the threatened takeover of Scottish Power, Scotland's third-biggest company. The loss of that major corporate headquarters would be a body blow to Scotland, to our economy and to Scottish prestige. It would be bad for the Scottish Power employees and for Scotland.
Does the member agree that it was only because of Margaret Thatcher that that company was established in Scotland with a major corporate presence? Will he also take into consideration the fact that Scottish Nuclear has, through British Energy, become the UK's voice?
No matter what the member's intervention is about, he always turns the debate around to nuclear energy.
One thing is certain: the Government and the Parliament must fight to retain Scottish Power's independence. We must make sure that we do all in our power to resist any foreign takeover of such a major Scottish company.
It is not just Scottish Power's future that is uncertain, but Scotland's energy future. Key decisions must be taken by the Scottish Parliament on our future energy policy. If the Parliament is capable of taking decisions on the future of our education and health policies, we are certainly capable of taking decisions on the future of our energy policy. We have to make sure that our energy resources work for the people of Scotland. That is why today the SNP calls on the Parliament to support the formation and implementation of a Scottish energy policy that will give us security and continuity of energy supply and energy self-sufficiency, reduce carbon emissions so that we can tackle global warming, eliminate fuel poverty and deliver affordability and energy efficiency.
Will the member enlighten the Parliament on what the SNP means by "self-sufficiency"? Is the SNP's policy that Scotland should continue to be a net exporter of energy or does "self-sufficiency" mean that Scotland's share of the electricity generating market should reduce?
The SNP's position is clear. Scotland's energy resources must benefit the people of Scotland first and foremost. If there is potential to export energy thereafter, that will be all very well, as long as certain conditions are met.
The UK's energy policy is failing Scotland. We are not receiving the benefits of living in an energy-rich nation at a time when the value of energy is at an all-time high all over the world. Let us consider Scotland's oil and gas resources. We have two thirds of the European Union's oil. There is a lot of life left in the North sea industry; even Government ministers now say that there are 30 years of production left in the North sea. The oil company Talisman, whose representatives I met a few weeks ago, is the biggest independent operator in the North sea. It said that oil fields that were due to close a few years ago are having their lives extended until 2023 and it thinks that the North sea will produce oil and gas for another 50 years, not 30 years. That, of course, should mean a lot of oil revenue flowing into a Scottish exchequer and not being squandered by London and the Westminster Government. Gordon Brown should not be looking to smash and grab oil profits from the North sea, as that would destroy thousands of jobs and undermine the new-found confidence in the North sea that has been built in recent years.
We are also rich in terms of our renewables potential. We have hit the jackpot for a second time. This country has the potential to become Europe's renewables powerhouse. We have 25 per cent of Europe's wind resources, a quarter of Europe's tidal resources and 10 per cent of Europe's wave resources. We have other renewables potential as well—biomass and hydropower, which we use already, solar power and many other areas. The Government's 2001 report into Scotland's renewables potential found that we have the potential to generate six times the amount of electricity that we generate at the moment. Offshore wind power alone could generate twice the present amount of electricity in Scotland. We also have coal resources—we produce one third of the UK's coal.
As the SNP is explaining, the UK's energy policy is failing Scotland badly. Let us consider the scandal of fuel poverty. This nation is rich in energy resources, but tens of thousands of Scottish households cannot afford to heat their homes in winter. That is a scandal in 21st century Scotland. Only yesterday, we found out that there will be further increases in household fuel bills from Scottish and Southern Energy. We should not forget that every 5 per cent increase in fuel bills plunges an extra 30,000 Scottish households into fuel poverty. At the beginning of the 21st century, in one of the most energy-rich countries in the world, 13 per cent of our households are fuel poor and one in 20 deaths is a result of the cold. I commend the motion that Margaret Ewing lodged in the Parliament yesterday on excess winter deaths. It asks members to agree that the Parliament
"believes that, as an energy-rich nation, the people of Scotland should expect warm, dry and affordable ways to heat their homes".
I hope that every member will sign that motion. It is difficult to think of a bigger price that Scotland pays for being part of the UK. We have all those energy resources but people are dying of the cold in Scotland and tens of thousands of households cannot afford to heat their homes.
The business community has also been hit by high fuel prices. The Scottish Council for Development and Industry has passed figures to the SNP that show that fish farmers in the Highlands are now paying 52 per cent more for their fuel than they were last year. Manufacturers in Cumbernauld are paying 40 per cent more.
The UK's policy is also failing Scotland because of its obsession with nuclear power. During the past few weeks, we have witnessed with amazement the UK Government trying to soften up public opinion and turn it in favour of nuclear power. Some years ago, we were famously told that nuclear power would be "too cheap to meter", but now we know the truth. Scotland cannot afford to pay the economic, health, social or environmental costs of nuclear power. It will cost £85 billion just to clean up the legacy of nuclear waste. Five sites in Scotland have been earmarked by Nirex to become nuclear dumps. The Parliament must make every effort to stop any Scottish community being turned into a nuclear dump by Westminster or this Government.
Last week, my colleague Bruce Crawford received an answer to a parliamentary question that confirmed that, today in 2005, 11 farms in Scotland are still subject to restrictions as a result of the incident at Chernobyl in 1986. Surely that speaks volumes about the price that Scotland would be required to pay for nuclear power.
Does the member accept that the accident that happened at the Chernobyl nuclear plant was the result of technology that is in no way comparable to that which has been used in this country and western Europe? Does he accept that his argument about Chernobyl is a complete red herring?
I can tell the Tories that the only thing that our party accepts about nuclear power is that it is dirty, dangerous and expensive. The Parliament must reject it.
UK energy policy is also failing our environment. Instead of having an energy sector that is currently Scotland's biggest emitter of carbon emissions, we should be investigating alternatives and accelerating the development of renewables. Six years into devolution, latest Government figures show that the percentage of electricity that is generated from renewables has gone backwards rather than forwards, despite all our country's potential. The Deputy First Minister and Minister for Enterprise and Lifelong Learning recently announced that he will support projects in the marine renewables sector for energy generation from wave and tidal power, but that announcement came six years into devolution and only after the public outcry that arose when it was discovered that Portugal had stolen leading wave technology from under our noses. People in Portugal will now benefit from wave technology that was developed in Scotland before the people of Scotland will. We need to consider using a mix of renewable energy sources—including offshore wind, hydrogen, biomass, biofuel, solar and even the possibilities of geothermal—to benefit the people of Scotland.
Energy policy is important because it deals not just with electricity—which accounts for only 20 per cent of energy—but with heating and transport. However, I draw to the Parliament's attention the on-going discrimination in the transmission charges that are imposed on Scottish power generators by the UK Government and its regulatory sidekick, the Office of Gas and Electricity Markets. The charges threaten to undermine renewables development in Scotland and must be opposed. We urge the minister to challenge that Westminster legislation, which threatens to destroy Scotland's renewables potential. As things stand, a generator in Skye will be forced to pay £23.10 per kilowatt for access to the grid, whereas a generator in Cornwall will receive a subsidy of £8.04 per kilowatt. That is a ridiculous anti-Scottish state of affairs and the situation must be changed if we are to deliver energy benefits for Scotland.
We need to manage demand through an energy efficiency strategy, which ministers have promised for a long time but will not—we are given to understand—deliver until spring 2006. We draw to the Parliament's attention the fact that the regulatory powers are reserved to Westminster—the Scottish Environment Protection Agency has rightly highlighted the fact that, because of that, it will be toothless to act on energy efficiency, despite the issue's importance. That is another example of why energy powers must be transferred back to Scotland.
Other opportunities for the future of Scotland's energy industry include carbon capture and storage. That could provide a huge opportunity to create new jobs in a new industry that would secure our energy future. Given that the world's largest hydrogen power station will be built in Peterhead and will supply carbon-free electricity to 0.25 million homes, we need to find similar huge opportunities elsewhere in Scotland.
Another example is clean coal. We know that, by 2015, 45 per cent of Scotland's generating capacity will close. Some 34 per cent of that is represented by the coal-fired power stations at Longannet and Cockenzie. By installing clean-coal technology and using carbon capture and storage technology, we could not only keep those stations open and allow them to continue to deliver energy to the people of Scotland, but tackle global warming at the same time. We have the expertise in Scotland to do that, but we are crying out for Government support to allow us to lead in those technologies not just here in Scotland, but internationally.
In the North sea alone, we would have the capacity to store 755 gigatonnes of carbon dioxide emissions under the sea if we could put in place the technology that already exists in the offshore industry. That would be equivalent to Scotland's output of carbon emissions for 5,000 years. Scotland could lead the world in a whole new industry.
The SNP recognises that securing our energy future will require difficult and radical decisions, but we can keep the lights on, keep our homes warm and fuel sustainable economic development in Scotland. We have the know-how and the resources in oil and gas, renewables and other technologies, but we need the powers for Scotland to take decisions on those matters as part of a Scottish energy policy.
I move,
That the Parliament considers it unacceptable that in energy-rich Scotland fuel poverty blights our society; notes with concern that, despite Scotland possessing massive energy resources, urgent action is required to avoid an energy gap in the next decade; calls for the development of an energy policy for Scotland that will deliver security of supply, affordability, self-sufficiency and energy efficiency; recognises that the transmission charges for power generators, as permitted by the UK Government, will undermine these objectives; rejects nuclear power in favour of an energy mix that includes making Scotland the world leader in renewable energy and carbon capture and storage technology; believes that such a policy will boost our economy and meet our environmental obligations, and recognises that the Scottish Parliament requires the necessary energy powers and control over our oil and gas resources to deliver the nation's energy needs in the 21st century.
I thank the nationalists for giving us yet another opportunity to debate energy policy. Although I can agree with much of the nationalists' motion, I suspect that, as ever, the principal dividing line between us is that the nationalists want to turn our principal market for our electricity generation—the rest of the UK—into a foreign country and thereby change our position from being a net exporter of energy to the rest of the UK to being a net importer.
Contrary to the nationalist position, we are committed to working with the UK Government, regulators and energy companies to achieve a balanced energy policy. Such a policy will deliver security of supply through diversity of supply. It will deliver affordable energy for householders and businesses, bring down the number of people who are in fuel poverty and—a critical issue of which Richard Lochhead made no mention—reduce carbon emissions. It will make the most of Scotland's natural and intellectual resources to deliver a strong energy sector.
Having heard the minister's words, I want to ask whether he realises that the target that he has set for renewables is less than what is currently achieved by Spain. Does he realise that recently Spain's system almost collapsed and was saved only by France's nuclear industry?
The renewables targets that we have set are certainly ambitious—Mr Gallie is correct at least on that point—but they are also deliverable. The targets are compatible with the energy policy that I outlined. Renewables have an important part to play in delivering security of supply through diversity of supply.
As time will inevitably be limited, I will mention only some of the Executive's achievements to date and the ambitious targets that we have set. On fuel poverty, a review of the first year of the central heating programme showed that nine out of 10 people who were fuel poor were lifted out of fuel poverty after receiving support from the programme. Over 2003-04, the average annual savings on fuel bills under the central heating programme were more than £376 for those aged 60 and over in private sector accommodation and more than £324 for those in local authority or housing association accommodation. By March 2007, all social sector housing tenants who want central heating will have it. The Executive has spent £140 million through the programme and we have provided central heating systems to more than 56,000 homes.
On energy efficiency, the Executive has allocated a further £64 million to the warm deal. Under the warm deal, more than a tenth of Scotland's housing stock has been insulated—that is more than 218,000 homes. Over 2003-04, that resulted in savings of £99 on the fuel bills of private tenants and £26 on the bills of those in housing association accommodation. As Richard Lochhead acknowledged, we are also developing Scotland's first energy efficiency strategy. Last year, we invested an additional £20 million in improving public sector energy efficiency.
On renewables, to which Mr Gallie referred, we have set a target—but not a limit to our ambition—of generating 40 per cent of our energy supply from renewables by 2020. That is a fourfold increase on current levels of renewables generation. We have also invested £3 million in the Marine Energy Centre in Orkney and we recently announced our intention—as Richard Lochhead mentioned—to amend the renewables obligation certificates scheme to award increased numbers of ROCs for wave and tidal output.
Does the minister accept that there is growing demand for a specific Scottish energy policy that looks at where we should produce energy, how we should produce it and how much energy we need? When will he produce that kind of policy, even within the limits of devolution? Why has he not responded positively to the request for such a policy by the Enterprise and Culture Committee?
We are producing an energy policy. The member acknowledged the forthcoming strategy on energy efficiency. Later today, I will announce the expected publication date for our independent review of Scotland's intermediate and future energy needs. We have committed ourselves to developing the very policy that the member seeks. However, it is critical that we do so in association with the UK Government, rather than by turning the rest of the UK into a foreign country or countries. It is fundamental that we have that perspective on the overall British energy market.
Will the minister give way?
No. I want to make progress.
We anticipate announcing a biomass support scheme after the new year. I believe that the thriving biomass and marine energy sectors in Scotland are second to none. They present us with the potential for an additional 1.5GW of installed capacity and up to 9,000 new jobs and they give us the opportunity to establish Scotland as a global renewables powerhouse. In the process, they would provide us not simply with security of supply, but with a sustainable energy policy into the future.
Will the minister give way on that point?
I want to make an announcement, if the member does not mind.
I am pleased to announce that, as a crucial part of having a considered and informed debate on energy policy—the point on which I was just challenged—we will release the first two volumes of the Scottish energy study by the end of the year. We commissioned the study to provide a factual overview of energy supply and demand trends in Scotland.
We recognise that conventional fuel sources are integral to meeting Scotland's energy needs. That is why we will continue to work with the UK Government, not least on the forthcoming UK energy review that was announced by the Prime Minister earlier this year. We will also work with regulators, which is critical, and with those involved in the energy sector in Scotland to ensure that demand is met and that we get the best possible deal for consumers, within market constraints.
We are also represented on Pilot, the joint industry-Government group that is tasked with creating a climate for the UK continental shelf to retain its position as a pre-eminent active centre of oil and gas exploration. We have that concern in common with the nationalists; we want to develop production and to keep the UK contracting and supplies industry at the leading edge in overall competitiveness.
We recognise the contribution to the energy mix that can be accrued from development of clean-coal technologies, to which Richard Lochhead referred. Scottish Enterprise commissioned a report, which was published in September 2005, on carbon capture and storage, to complement the Department of Trade and Industry's carbon abatement technologies strategy, which was launched in June this year. DTI commitments to invest in CCT research and development projects amount to £13 million since 1999.
BP, Royal Dutch Shell, ConocoPhillips and Scottish and Southern Energy have invested £330 million in developing a new 350MW station at Peterhead, which is to come on stream in 2009. That is leading-edge, state-of-the-art technology. BP suggests that it could extend the life of the Miller field by 15 to 20 years and increase oil recovery by up to 40 million tonnes.
Scotland is an energy-rich country that currently exports a sizeable chunk of its electricity to England and Northern Ireland. I want that to continue. Our current total generating capacity goes well beyond what Scotland consumes. Our commitment, set out in our amendment, is to an energy supply mix that strikes the right balance—an equilibrium between, on the one hand, meeting demand in Scotland and making energy affordable to consumers and, on the other, working for a sustainable future by employing strategies to make energy savings, to meet a growing proportion of supply from renewable sources and to encourage a change in culture among energy consumers.
I move amendment S2M-3543.4, to leave out from "considers" to end and insert:
"supports the Scottish Executive's continuing commitment to the development of a wide range of renewable energy technologies in Scotland as a key element of a balanced energy supply mix; supports the Executive's commitment to achieving 40 per cent renewable electricity generation by 2020; supports the Executive's attempts to eradicate fuel poverty by 2016; looks forward to publication of the revised Scottish Climate Change Programme and the consideration given to the contribution of energy efficiency and renewables to reduce carbon dioxide emissions; recognises the Executive's commitment, as set out in the Partnership Agreement, not to approve the construction of any new nuclear power stations in Scotland until the issue of waste has been addressed, and supports the Executive's commitment to continue to work with the UK Government and energy supply industries to ensure that the immediate and future energy supply needs of Scotland are met."
It is something of an irony that, as we discuss renewable and other forms of energy, I am being blinded by the sun.
Will the member give way?
If Alasdair Morgan has a serious intervention to make.
It is serious. This is the first time for many years that the sun has shone on the Conservative front bench.
We must accept it when it comes our way.
I am glad that the Scottish National Party has raised the issue of energy policy for us to debate this morning. That is part of a process that is beginning to deliver some understanding of the ground rules on energy policy in Scotland and what we need to discuss. Too often in the past, it has been easy to bring forward ideas and to be extremely controversial in our presentation of them. Politicians like to butt heads occasionally. However, in his opening remarks today, Richard Lochhead did the whole Parliament a service by setting out the types of discussion that we need to have. He provided a comprehensive description of the situation in which we find ourselves. There was much in his interpretation with which Conservative members, like the minister, can agree.
Will the member clarify whether he agrees with his new leader that energy policy should not be devolved further or whether he agrees with his new deputy leader that it should all be devolved?
That is a spurious interpretation.
There is much in the SNP motion and all the amendments that have been lodged this morning with which I agree. However, there is much in the motion that we must debate and consider in greater detail. I agree with Richard Lochhead that security of supply is an important issue that we must address. However, if we are to have security of supply, we must be all encompassing in how we consider future and present technologies as part of an electricity-generating programme for the future. If we are to address affordability, we must consider the cost of becoming increasingly dependent on renewables and as yet undeveloped technologies, as Richard Lochhead suggests. How can we guarantee affordability if we do not consider current technologies?
The motion also mentions energy efficiency. We accept that energy efficiency has an important role to play, but we cannot address the issue, especially in the domestic setting, without addressing affordability. Members from other parties have suggested that building regulations should be enhanced. That is a good idea—we can increase domestic energy efficiency by that means. However, if we do that in such a way as to increase the basic costs of housing, affordability of housing will become a problem. We must address energy efficiency in an all-encompassing way and ensure that account is taken of affordability and security of supply.
I understand that the Conservative party's policy in favour of nuclear power would override any of the considerations to which the member referred. Does he agree that, if we spend £X on energy matters, the value that we get from energy efficiency will be seven times greater than that which we get from building a nuclear power station?
The member misunderstands the Conservative position. We are not prepared to sell our souls for nuclear power at any cost. We believe that nuclear power is part of a rational and well-developed energy policy and should be addressed as part of the debate.
I move on to some of the issues with which Richard Lochhead deals in his motion. Transmission charges for electricity will add cost to the transmission of electricity from Highland wind farms. However, we must accept that the charges deliver reduced costs to the consumer in Scotland by spreading the cost of Scottish grid development across a much larger base in the UK, rather than targeting it on Scottish consumers. It is swings and roundabouts.
The member talks about swings and roundabouts in transmission charging. Does he acknowledge the Scottish Executive's success in introducing into the Energy Act 2004 provision to cap transmission charges in the north of Scotland?
Indeed, that was an important change in the procedure for charging for electricity.
I have taken a few interventions. I now intend briefly to run through the issues, in particular the North sea oil industry. North sea oil is a great windfall for this country—no one would say differently. However, the idea that a windfall tax should be levied against companies operating in the North sea is wholly unacceptable, as stability in the marketplace is essential to future investment. Any change in the administration of North sea oil and gas fields would undermine confidence, particularly if such a change led to this Parliament having absolute control. The suggestion that the future stability of the North sea oil and gas industry should be thrown to the winds of this chamber would undermine confidence in the industry forevermore.
I will address the points that have been raised in interventions. On the Conservative benches, we believe that nuclear power has a future. It is important that we address that issue now; the debate must be had. Resolving the waste issue and commissioning new nuclear power stations can and must run in parallel, as the lengthy commissioning process means that decisions about new nuclear stations cannot be left until the last minute. We want to ensure that we have secure, sustainable electricity supplies through the use of existing and new technologies.
Will the member give way?
The member is finishing.
If in the long term we are to have affordable and available electricity, we must ensure that we have secure supply. We should not allow our nuclear stations to be decommissioned and not replaced, because we do not have a policy adequately to supply power in the future.
I move amendment S2M-3543.1, to leave out from first "recognises" to end and insert:
"believes that renewable and nuclear energy are complementary and that, in order to achieve a balanced energy policy, no existing or potential resource should be ignored; urges the Scottish Executive to revisit its renewable energy policy to provide proper planning guidance to local authorities, communities and developers in relation to the siting of wind farms and, until this guidance is implemented, calls on the Executive to declare a moratorium on the determination of locally-opposed wind farm planning applications, and believes that the North Sea oil and gas industry is best served by the current regulatory arrangements."
The Green party very much welcomes this debate, which is extremely important, as Richard Lochhead said, and timely. However, although we agree with the bulk of the SNP motion, it does not go far enough either in recognising the role of energy in the generation of greenhouse gases or in promoting policies that will be needed to address climate change and to develop the energy networks of the future.
Climate change must be at the heart of the decision-making process in developing an energy policy for the coming century. It is hard to overstate the importance of climate change, but suffice it to say that it remains the greatest threat that faces us, our society, our environment and our economy. It is worth bearing in mind the fact that the sectoral emissions data for Scotland show that energy in all its forms accounts for no less than 79 per cent of our carbon emissions. We agree with the SNP that decisions on energy should be devolved to Scotland, but the content of the policy is more important than the body that determines it.
How can the member accuse the SNP of not addressing global warming in its motion when it refers to the need for renewables and for carbon capture and storage technology?
That is not what I meant: I said that climate change was not mentioned, but should be at the heart of all our decisions.
We have a clear picture of the energy future that Scotland needs, which includes a combination of radical energy efficiency gains and a sustainable energy supply. The ways in which we generate, distribute and use energy today are woefully inefficient. In coal-fired, gas-fired and oil-fired power stations, more than two thirds of the energy content of the fuel is wasted before energy reaches our homes. We emit 100 per cent greenhouse gases, but get the benefit of only about 30 per cent of useful electricity. We can do better than that.
We need to make dramatic gains in energy efficiency across all sectors—in our housing stock, in our businesses and in our transport use. Much of Scotland's housing is in poor condition, but in spite of many welcome initiatives, growing numbers of households are in fuel poverty. A focus on energy efficiency can transform lives and, in some cases, save them. Our businesses often pay scant regard to how they use and misuse energy. I have never understood why many hard-nosed businessmen overlook energy efficiency as a way to save money—as far as I am concerned, it is a no-brainer.
Which businesses has Shiona Baird talked to? I can hardly find one that does not have an efficiency engineer in order to address issues such as she raises.
Just look at the number of lights that are left on at night in all sorts of industries, factories and shops. There is Phil Gallie's answer.
In transport, improvements in engine efficiency are being outweighed by an increase in the volume of road traffic and an increase in the use of larger and less efficient, but supposedly more desirable, cars. Are we serious about tackling climate change and reducing energy use? If we are, why do we have this continuing fixation with wasting money on building more roads, which can result only in more traffic and increased carbon emissions? It is time for some joined-up thinking—although this is not a transport debate, so I had better watch my step.
Perhaps housing is the sector in which gains can most easily be made and can result in most savings. In addition to insulating our lofts and cavity walls to ensure that increasingly expensive fuel supplies are not used to heat the neighbourhood, there are now ways for households to take control of their own energy futures by generating their own energy. Several Scottish companies now offer domestic solar water heating, which can cut gas bills in half. Small-scale wind turbines will become affordable over the next couple of years and could transform not only our city skylines but our electricity bills.
Will the member give way?
I am sorry, but I need to move on.
We cannot sit back and wait for microgeneration to happen by itself, which is why I am proposing a micropower bill, which would set targets for installation of micropower systems, overhaul the planning system to make installation of home renewables easier, create an obligation for new buildings to have microgeneration capacity, and offer council tax and business rates rebates for people who install such capacity. Sarah Boyack also has an interest in the subject; I hope that we can work together to bring about a quiet revolution in how we generate energy.
An expansion in microgeneration must go hand in hand with changes in how our electricity supplies are transmitted and distributed. The national grid is currently wired up to support a small number of large power stations. We need to turn that on its head. Our vision is of a much larger number of small generators. Such a decentralised energy network would be more stable, more efficient, more democratic and more accountable. In the long run, it would also be much cheaper to operate.
Scotland and the UK have one of the most centralised electricity networks in the world. The majority of consumers do not know where their power comes from, other than that it comes out of a wee hole in the skirting board. A decentralised network, whereby every home, office and factory has the potential to create its own energy, makes the connection between supplier and consumer, and inevitably breeds efficiency and innovation.
Energy and the environmental problems that arise from its generation and use remain the most pressing issues that face us today, but if we have the imagination and political courage to grasp the nettle, we can go a long way towards gaining a secure and sustainable energy future for our children. If we delay and fail to open our minds to the sustainable solutions that are out there, we will condemn our children to a future of hardship and uncertainty. That is not such a hard choice.
I move amendment S2M-3543.3, to leave out from "to deliver the nation's" to end, and insert:
"in order to deliver Scotland's sustainable energy needs and to tackle climate change which is recognised as one of the greatest threats to our economy, communities and environment; further considers that, if we are serious about tackling climate change, a radical overhaul of our energy use is urgently required, particularly addressing contradictory transport policies which are increasing carbon emissions, and further notes that a truly sustainable energy policy will require the widespread adoption of domestic and community-based renewable micro-generation as well as the development of decentralised energy networks."
Allan Wilson's amendment sets out clearly how we see energy policy—it should be founded on a wide range of renewable energy technologies as a key element of a balanced energy supply. As Richard Lochhead outlined, we have huge natural resources in Scotland, including wind, wave, tidal and hydropower. He also said that we have another 25 years of North sea oil. It seems that for as long as we have had oil in the North sea, we have had a receding 25-year horizon. However, there is a lot of resource in the North sea, as well as potential for carbon storage, which is useful.
Yet again, the Tories call for a moratorium on wind power development, about which many myths exist. Strategic planning guidance has been produced on such development—we have national planning policy guideline 6 and planning advice note 45. Local authorities have avoided grasping the nettle and have assumed a sloping-shoulders policy. They cry that there is no strategic direction, but strategic direction exists and some councils have acted on it. I commend Aberdeenshire Council, which has produced supplementary planning guidance for applicants. Local authorities should develop the strategic guidance: planning is a local authority responsibility, so authorities should take it.
Does Nora Radcliffe accept that a Scottish strategic policy on siting wind farms can be dictated only from the centre, not by local authorities, and that therefore strategic guidance from Scottish ministers is essential?
Watch my lips. We have strategic guidance in the NPPG and PAN. The guidance exists, but it must be developed by local authorities. The people who oppose wind farm developments at all costs do not seem to realise that uncertainty and delays cost Scottish jobs.
Does Nora Radcliffe agree that, in order to be consistent in supporting renewables, members must consistently support projects that deliver renewables capacity?
Yes—that is right. We must take the hard decisions and stand up for what we believe in.
We have sometimes to challenge the perceived wisdom, which can turn out to be not so wise after all. A new wind farm has just been commissioned in my constituency. Many concerns were expressed about it beforehand, but now that it is up and running, there are no problems. Once people see developments on the ground, they find that many of the myths about the downside of wind farms are just that—myths.
Does Nora Radcliffe agree that the minister's intervention does not mean that he will approve all planning applications for renewables developments that come before him for adjudication?
Exactly. Planning is about having the right development in the right place and people must make decisions within the policy framework. We have a strategic policy and local authorities should have local policies. Decisions must be made in accordance with those policies, but local authorities must make those decisions. The difficulty is that people shy away from making such decisions, which creates uncertainty and delay. That is not good for business and it means that Scottish workers are being laid off. I recently spoke to a businessman who manufactures stems for wind turbines and who had to lay off 30 people because delays in planning meant that orders were not coming through. He could not retain his workforce, which is a tragedy.
I turn to wave power. What is wrong with the fact that the Pelamis device is being used in Portugal? The Scottish company that developed the system has sold its expertise abroad, but the profits are coming back here and we will benefit from the development. We do not need to keep everything within our borders. Scottish Power has more than 5 million customers, 60 per cent of whom are outside Scotland. That is fine because we are an exporting nation. We are tiny, so we do not want to keep everything within our borders.
I welcome exports when they happen because they may benefit our economy, but do we not need to use the Pelamis technology here to tap into our renewable resources? Does Nora Radcliffe agree that the company's move has been criticised because it means that that will not now happen?
That is a fairly apocalyptic view. We will use the technology here, in time. Pelamis was developed because we had the European Marine Energy Centre in Orkney. Without that, the company could not have progressed the technology to the point at which it could be taken to Portugal.
Hydropower will make a huge contribution to our target of 40 per cent of electricity generation from renewables by 2020. There is scope for new hydro developments, but people do not always realise that tremendous scope also exists to upgrade old hydro systems, which use plant that is 50 years old that could be replaced with much more efficient and productive modern plant to get an increase in hydropower generation.
You have one minute remaining.
Oh, crumbs! I had better get a move on.
At community level, we should consider local combined heat and power systems and community wind power. In Castlemilk in Glasgow, an excellent project has been established involving two wind turbines that benefit the local community. Such developments are a super way forward. We may need fiscal incentives for combined heat and power systems, but we also need a mindset change. People need to realise that the technology is perfectly viable and that they can do it. We want a can-do mentality on combined heat and power.
Tremendous opportunities exist for biomass and biodiesel systems. The National Farmers Union of Scotland is keen on development of such systems because they allow farmers to diversify. As Shiona Baird said, much can be done domestically through measures such as wind microgeneration, solar-powered water heating, ground heat and photovoltaic energy. We should consider reversible metering and give people information and perhaps grants to encourage them to do what they can domestically.
I must mention nuclear power. The Executive amendment says that we will not have new nuclear power stations until we have cracked the waste problem, which has not happened. Members know my views on nuclear power, so I will not go into that.
You must finish now.
We should never forget that energy efficiency is only half the answer.
I intend to speak to two lines in our motion and my colleagues will speak about the rest. The two lines, which are the most important, read:
"That the Parliament considers it unacceptable that in energy-rich Scotland fuel poverty blights our society".
I know that that view is not shared by the Conservatives or the minister and the Liberal Democrats, because their amendments would delete those lines, which is absolutely appalling. It is a bitter irony that we are compelled again to mention fuel poverty in our energy-rich nation. I do not complain that we are a net exporter of energy, but it is a bitter irony that, even as we debate the matter, people are choosing whether to eat or to heat.
The 2002 figures showed that 46,000 children lived in fuel-poor homes. I suspect that given the fuel price rises that have occurred and the fact that every 5 per cent rise puts another 30,000 households into fuel poverty, the figures are on the increase. Fuel poverty is defined as when more than 10 per cent of a household's income, including household benefit or income support for mortgage interest, must be used for household fuels.
The member rightly mentions fuel prices but, at the recent SNP conference, Richard Lochhead called for eco and carbon taxes to be put on the agenda. Surely that would have an impact on taxes for companies and, potentially, on fuel prices, too.
My point is that people on low incomes are unable to cope with fuel price increases. It is significant that fuel poverty leads to respiratory problems among children, which means that they are off school. Those children are not only fuel poor, they are opportunity poor.
In a parliamentary answer to me yesterday we were told yet again—using figures that are three years old—that 286,000 households, or 13 per cent, are in fuel poverty. It would be churlish of me not to applaud the Administration's central heating programme and other targeted initiatives such as the warm deal.
Will the member take an intervention?
I must make progress.
I would like the central heating programme to be extended to faulty and still-functioning systems, which fall outwith its remit at the moment, as do homes with children living in poverty or homes in which there are people who are disabled or severely disabled. In addition, I would like the programme to be accelerated for people who can show medical need, so that they are not just put into a queue. Those initiatives would, if they were implemented, pay dividends in human happiness, health and well-being and—incidentally—would cost society less in health care and other demands on the public purse. In the meantime, against the background of the worthy initiatives and notwithstanding the winter fuel payment, the system continues to fail children and elderly people. It is a fact of life that low wages and low pensions bind people into poverty, which keeps them in poorly insulated poor-quality homes.
Given Christine Grahame's obsession with the cost of electricity, why did she oppose the privatisation of electricity, which saw costs reduced significantly to a sustainable level?
Phil Gallie is always trying. Sometimes he is more trying than usual; that question was very trying. [Interruption.] I have more important issues to deal with—only a few members have dealt with fuel poverty.
The Administration has pledged to eradicate fuel poverty, as far as is practicable, by 2016. That will not happen. The Administration parties and the rest of Parliament would like it to happen, but we simply do not have the power or the opportunity to achieve it. We are constrained within the limitations of devolution. Independence is not an academic point; it is a practical, deliverable point.
Will the member take an intervention?
No. I have only six minutes and will not get extra time for interventions.
Excessive winter deaths remain a scandal: last year's figure was 2,760, and that was a good year. In 1999, when there was a flu epidemic, the figure was nearly 6,000. It is not scaremongering to say that, given the situation in households in Scotland, the impact on Scottish people of avian flu would be far greater than even in the Scandic countries, which, although they are far colder than Scotland, suffer nothing like the number of winter deaths that we have. The minister's hands are tied because of our limited powers. We should have a thriving economy, but without the power to raise the basic level of our people in society, those winter scandals will continue. Poverty is the root of many social ills and it condemns many Scots families, our elderly people and our young people to a cold and uncertain winter. I say to the minister that that is not scaremongering. The scandal of fuel poverty will be on all our hands, and the cold winter reality approaches fast. Without independence and the power to really deliver for the Scottish people, we will not radically change the situation.
I apologise because I will have to leave fairly shortly. We have visitors from the European Parliament, whom I am to take round Parliament.
I refer members to the Enterprise and Culture Committee's 2004 report into renewable energy, copies of which are at the back of the chamber. I was and remain a member of that committee. Page 7 of the report states:
"The Committee believes that the opportunities and potential benefits presented by the renewables energy sector are so great that the Executive should be prepared to invest significantly in the sector. It should be treated as a priority sector by the enterprise networks and the full range of business support mechanisms should be brought to bear on its development. In circumstances where the private sector is risk averse the Scottish Executive should take the lead."
We have heard of the welcome investment in Orkney and we heard the minister's announcements earlier. However, I would like to direct colleagues' attention—if they are not already aware of it—to a Canadian set-up called Blue Energy Canada Inc. It is well worth a look—its details are on the internet. What the company proposes is quite detailed. Such is the force of the tidal current flowing through the Pentland firth that I have in previous debates on energy described it as having the potential to be the Saudi Arabia of tidal energy. What Blue Energy has been developing is particularly interesting. It is broadening out beyond tidal energy to ocean currents, which are permanent and do not change direction—they are there for ever. We all know that as long the earth goes round the sun and the moon goes round the earth there will be tidal energy. Other members have referred to the massive potential in that, but I want to home in on it.
I do not want to pre-empt the report into growing the Scottish economy before it has been published. I see that Alex Neil, the convener of the Enterprise and Culture Committee, is eyeing me carefully, so I will not drop him in it. However, it would be fair to say that what we have heard about research and development and the way in which it is conducted in other countries is very interesting. I hope that our report will reflect that. Research and development on tidal energy continues; when we were writing the report we saw the work that is being done at the Robert Gordon University on devices that can be put on the sea bed. They are small things—not much bigger than two chamber desks—but achieving the huge construction that is needed is where the R and D and commitment will have to come in.
Will the member give way?
I will if I have time—I have only a short time for my speech.
It is on fronts such as tidal energy that useful work could be done. The Robert Gordon University is involved; what about the University of the Highlands and Islands? What could not be achieved in engineering development?
Richard Lochhead referred to the oil sector. I worked in that sector in the 1970s and 1980s on projects such as the Hutton tension-leg platform and the Ninian central platform—albeit that I worked at skivvy level. It is the vision and the drive to get those huge technologically cutting-edge structures out there that mean that Richard Lochhead can say that we will have 25 more years of oil, and possibly more. However, the commitment of the private and public sectors in those years is essential. We need to get into fifth gear on tidal energy potential—all of us, in all parties, must keep our eye on that. If we miss that opportunity we would be making a big mistake. Denmark strode ahead and leads the world on wind energy; we have the opportunity to get in on tidal energy and we must move fast.
Can Jamie Stone give us a date on which sufficient tidal energy will come from the Pentland firth to enable us to switch off a nuclear or a coal-fired power station? I can give him dates when those power stations will have to close.
I cannot give the member a date, but I hope that it will happen as soon as possible, so that we can get the maximum energy out of the Pentland firth and use it for the good of Scotland. Arnish yard in Stornoway is already benefiting from the construction work that Nora Radcliffe talked about—think what it could do for the Nigg yard and the other fabrication yards in Scotland if we really got going on those big structures. It is too important an opportunity to miss. I commend Blue Energy to colleagues; if they have not already done so, they should take a look at what that company is doing. It is well thought out, and a lot of the technology for what it wants to do already exists.
I am pleased to have another opportunity to debate energy policy. It is an important issue, which tends to provoke fairly lively debate. I note that there has been some attempt to include the perpetual debate about the constitution, but I am pleased that most members have chosen to stick to energy matters. I am pleased that the Scottish National Party has chosen to have only one Opposition debate this morning, rather than the customary two, because energy is an issue that is important enough to require the development of ideas. As the minister and Alex Johnstone did, I agree with many parts of the motion. I will say more on that in a minute.
The minister referred to the Executive's ambitious targets for energy generation from renewable sources.
Dr Murray agrees with much of the motion, so does she regret the fact that the Executive's amendment would delete the reference to fuel poverty?
The minister has made clear our commitment to the eradication of fuel poverty. We all appreciate that it is an exceedingly important issue.
The target for renewables is 40 per cent by 2020. The SNP has said that it would prefer that to be increased to 50 per cent, and its motion calls for Scotland to be
"the world leader in renewable energy and carbon capture and storage technology".
I do not disagree with that aim, but I remain to be convinced that such a target can be achieved under the SNP's current plans. If the SNP wants a target of 50 per cent to be met in the next 15 years, why do SNP politicians so often voice their objections to wind turbine developments in their back yards? Christine Grahame, Roseanna Cunningham, Fergus Ewing and Angus McNeil have all objected to such developments.
I am not opposed in principle to wind turbine developments, but the fact is that there is no national framework. Modifications have already been made to the proposals to which Dr Murray referred for a wind farm at Walkerburn; that has happened as a consequence of a proper campaign to have it moved off the southern upland way. The member should get her facts right.
Christine Grahame objected to wind farms in her own back yard. Why has the SNP's economic policy over the past decade been predicated on the exploitation of a non-renewable carbon-generating source of power?
I return to the part of the motion with which I agree.
Will the member take an intervention?
No. I am sorry, but Christine Grahame made a rather long intervention.
The motion says that we should develop
"an energy policy for Scotland that will deliver security of supply, affordability, self-sufficiency and energy efficiency".
I argue that we should develop a policy that will deliver the export of power. The motion is right, which is why I support the development of a balanced energy policy that includes a wide range of renewables—other members have said that—including tidal wave power, clean coal, biomass, energy efficiency measures and nuclear power. Whatever side of the argument a person takes, the time is coming when difficult decisions about nuclear power will have to be made. I am afraid that the wriggle room in the partnership agreement will not exist for much longer.
Will the member take an intervention?
No. I am sorry, but I must make progress.
The Committee on Radioactive Waste Management report on management of our existing nuclear waste is due next July and I understand that it will suggest a solution that could encompass disposal of future nuclear waste. We must dispel the myths about the new generation of nuclear power stations. They do not have to be linked to the production of nuclear weapons. That was true of the Magnox reactors, such as the reactor that is currently being defuelled at Chapelcross in my constituency. That reactor was not viable without the sale of tritium, but that does not have to be the case for Chapelcross 2. Unlike the Magnox reactors, the new reactors—such as the advanced passive reactor—do not produce large volumes of irradiated graphite in the reactor cores. Over 60 years, an AP 100MW reactor would produce approximately 2,000m3 of low-level radioactive waste and 700m3 of medium-level waste. The solutions that must be found for our existing nuclear waste could encompass the disposal of some of that nuclear waste.
I fear that, without nuclear power, we will not only struggle with our base-load capacity, but may become increasingly dependent on imported sources of fuel over time. I fear that the country may change from being an exporter of fuel to being an importer of fuel and that we may have to import from countries such as France and Finland, which have decided to include nuclear generation in their energy portfolios.
Will the member take an intervention?
I am sorry, but I have only another minute and a half left.
I do not want to talk only about nuclear power; I am sure that my colleague John Home Robertson will return to the issue.
I whole-heartedly support the development of a variety of renewables technologies. Nora Radcliffe referred to the contribution that hydroelectricity has made over the years and the contribution that it will make to the achievement of our 2012 target.
Offshore wind has its place, too. I have voiced concerns about proposals for large-scale developments that would use huge turbines in locations in my constituency, but I do not oppose wind power per se, and I have an alternative solution. [Interruption.]
Order.
Biomass is an increasingly important and interesting opportunity. We have heard concerns about E.ON UK, but it has recently been given the go-ahead for a 44MW dedicated biomass power station at Steven's Croft in Lockerbie, which should commence generation in December 2007. That power station should support 40 jobs directly and an estimated 300 jobs in forestry and farming. It will provide a use for by-products of the forestry industry and offer an opportunity for farmers to diversify into willow production. Therefore, I was a bit surprised that the Green regional list member, Chris Ballance, attacked the proposal in the local press. Perhaps that demonstrates that it is not only SNP members who are inconsistent on energy policy.
I support the Executive's amendment, but say to members that serious debates and difficult decisions are looming on the horizon about the place of nuclear power—which is the alternative to big wind farm developments—in a balanced energy policy.
I point out to Christine Grahame that the Tory amendment would retain the words "fuel poverty" and that the amendment would start to apply from the fifth line of the motion. I hope that that is acknowledged. In the interests of balance, the Labour-Liberal Executive's amendment also includes the words "fuel poverty". It is important to be accurate.
The motion is wide ranging and there needs to be a wide-ranging debate on energy policy—or the lack of it. Jamie Stone—I am sorry that he has left the chamber—was right to talk about tidal power. I commend the excellent research on decommissioning that is taking place at the North Highland College. Cutting-edge, worldwide decommissioning research is being done in the north Highlands and more than 17 PhD students are leading the world in that respect. Tidal power is being looked into. In considering energy, we should consider the excellent research work that academics are doing in this country.
Obviously, the race to embrace wind farms through renewables obligation certificate payments results in higher prices for all consumers. Therefore, we should remember that there will be higher prices and more fuel poverty as a result of wind power. I will return to that topic later.
Elaine Murray said that any reasonable debate must include the nuclear option. Members could ask the people of Caithness whether they want their county to be covered in wind farms or whether they would like to have the next nuclear station. Those people should know the answer, as they have had Dounreay since the 1950s, and I can tell members what their answer would be.
I want to deal with something that other members have mentioned. I note the SNP's commitment to wind farm energy, which Richard Lochhead talked about passionately—I listened to him carefully. However, the member of Parliament for the Western Isles won his seat on the basis that he was opposed to wind farms. That is acknowledged in a paper that I have with me.
Will the member take an intervention?
Not at the moment.
How can someone pursue his opposition to wind farms in a party that is totally committed to wind farms? That is simply impossible. I do not mourn the loss of a Labour politician, but I acknowledge honesty and SNP members must be honest when they debate.
Is the member saying that it is wrong to support offshore wind farms? Does the Tory party oppose all kinds of wind energy?
The member should have listened to what I was saying. The SNP MP for the Western Isles won the election on the basis that he was opposed to wind farms, but the party's policy is totally in favour of wind farms. There should be a bit of honesty in the debate.
There is no doubt that, to date, the Executive has seen renewable energy predominantly in terms of wind farms. I commend much of what Elaine Murray said. All members need to consider what plans are in place to replace the gas, coal and nuclear power base-load stations when they close less than two decades from now. That is a crucial question that has not yet been answered. Wind-generated power is unpredictable—gales do not always blow in the Highlands—and requires 80 to 85 per cent back-up to ensure consistent supply.
In seeking equilibrium in the energy market, we must focus on supply, although it is obvious that we cannot lose sight of demand. I note what Shiona Baird said about energy efficiency, which must always be part of the debate. The Conservatives introduced the warm deal to encourage energy efficiency, provide warm homes and save consumers money. The Executive's free central heating programme has undoubtedly helped many elderly people to live more comfortably in their own homes, but the Minister for Communities is considering extending the programme to cover people who are in receipt of pension credit. Given the huge cohort of people on pension credit who could be taken out of fuel poverty by the programme, why has the warm deal budget been cut by £12 million over the next two years? The budget will go down from £57 million to £45 million. If we are serious about extending the warm deal, we should realise that that cannot be done through cuts.
I am sorry that I did not make an intervention during Nora Radcliffe's speech. I point out to her that, apart from the fact that the planning bill will come before the Parliament next month, the Executive's reason for putting NPPG 6—the planning guideline for renewable energy—out for further consultation in January is that it is not sufficient for dealing with the demands that planning departments, wind energy development companies and local objectors are placing on the wind power sector. The Liberal-Labour coalition is re-examining that guideline because it is not sufficient; I agree, although I disagree with the fact that the guideline will apply in parallel with the planning bill yet lie outwith its scope. I doubt whether those who object to wind power will get the same option to be consulted as those who will be included in the consultation for the planning bill. I welcome the consultation and I hope that it will give equal powers to objectors to wind farms and objectors to other developments.
No debate on energy in Scotland can ignore the key role of Scotland's third-largest company, Scottish Power, with its 6,000 staff in Scotland and 15,000 staff worldwide. Scottish Power operates coal power stations, hydroelectric power stations, wind farms, gas storage facilities and, in central and southern Scotland, transmission and distribution networks. It also has a retail electricity and gas supply operation that serves 5 million customers in the United Kingdom. Scottish Power's corporate headquarters are at Atlantic Quay in Glasgow; its human resources and finance departments are at Bellshill; it has call centres and administration centres in East Kilbride and Hamilton; and about 2,000 of its staff are based in my Glasgow Cathcart constituency.
Scottish Power is a progressive company in several respects. In respect of investment, the sum of £3.1 billion is earmarked for investment in UK generation infrastructure. In respect of corporate social responsibility, the company is ranked second in WWF's European Union rankings for power companies dealing with climate change. The company's lifelong learning department has assisted communities, staff and their families, and has provided training to around 10,000 unemployed young people. In respect of industrial relations, Scottish Power pays above-average wages and applies above-average conditions of service, especially for its call-centre staff; such staff do not always get a good deal. It provides good pension schemes. It has a good health and safety record. It has good relations with the unions that represent the workforce.
However, these are worrying times for Scottish Power. Its acquisition of PacifiCorp in the United States is acknowledged to have been a strategic error and a new strategy is now in place. As part of that strategy, PacifiCorp is now for sale and a £60 million per annum savings target is being implemented. Sadly, one of the main consequences of meeting that target is that 450 jobs at Scottish Power, including 300 jobs at Cathcart, will be lost over the next 18 months. Any job losses are, of course, very regrettable and everything possible will be done to assist people who are made redundant. Let us not forget, however, that Scottish Power created about 1,200 new jobs in Scotland last year. Scottish Power's retrenchment strategy, given a chance to work through, may well stabilise the company. It is still a strong and respected company with an international reputation. Until the acquisition of PacifiCorp, it is arguable that it had not put a foot wrong.
There are other reasons to worry about Scottish Power's future. I refer to the fact that the German company E.ON, the owner of Powergen, is considering a takeover bid for Scottish Power. As a lifelong trade unionist, and through my 18 years in local government, I have been involved in many battles to retain jobs. I am strongly of the view that no politician and no party has the right to play politics with people's jobs, but I am partisan about Scottish Power in one respect: I am on the side of its workers. As members would expect, I am in close contact with the workforce unions and I share their view that an autonomous future for Scottish Power is still a viable option. Let us not overlook that option or write it off. Let us not make a takeover a self-fulfilling prophecy by default.
Having said that, I recognise that the directors of a publicly quoted company such as Scottish Power have a fiduciary duty towards their shareholders to consider any appropriate bid that is made formally. Such a bid would inevitably increase the worries that my constituents feel. For my part, I can never view with equanimity the practice whereby, with a stroke of the accountant's pen, the lives of hundreds of hard-working families may be blighted.
Consumers, too, might have something to fear from the success of such a takeover bid, with the consequent diminution of competition. An E.ON acquisition could result in a company with 30 per cent of the UK market. For that matter, a Scottish and Southern Energy acquisition could lead to a virtual monopoly in Scotland. I therefore wish to make it clear that, in the event of a formal bid emerging for Scottish Power, I am likely to refer the matter to the UK Competition Commission.
Here we are again, discussing energy. It is a regular occurrence—we do it week in, week out, whether the debate is led by the SNP, the Tories or the Executive. There is no doubt that energy is the strategic question of our time, which the world will have to resolve. With every debate that we have held on energy, there has been no fundamental change in the strategy and policies that are advanced in the Scottish Parliament and there have been no major breakthroughs on how energy will be supplied in Scotland—and elsewhere, taking into account technology exports.
Christine Grahame referred to the 286,000 households who cannot keep themselves warm. In Scotland today, people are sitting freezing cold, wrapped up in blankets, with thick socks on. The minister says that we are an energy-rich nation, so why on earth can we not deal with that? Why have we not resolved that situation?
Will the member give way?
Not at the moment. I am asking Allan Wilson a question. Why are we impotent on this matter?
Let the minister answer.
He is not answering the question in my time—he gets 15 minutes to sum up. Why is the Executive so impotent and unable to change the situation? We have the research, the statistics and the annual motion on winter deaths. All the charities give us their figures. The cycle repeats itself over and over again and we still cannot solve the problem.
What is the point of having power if we cannot wield it to meet a basic human need—to keep warm? One of the reasons is that the Executive is addressing only one half of the equation. The warm deal is fair enough and promoting energy efficiency in homes is fine. The big problem—the other half of the equation—is that the Executive has no control over pricing or over the costs that households pay for their energy. I have lived in lots of energy-inefficient houses without gas central heating. Whether I was freezing cold or warm depended on two things: my income at the time and the cost of gas and electricity. The Executive has no control over the cost of electricity or gas.
I thought that Charlie Gordon was going to apply for a job in Scottish Power's public relations department. The same company that made £273 million profits, as announced in the news this morning, is trying to justify across-the-board increases in fuel costs in a country with low wages.
Will the member give way?
No thank you.
What will the Executive do, given that we have no control over oil either? Over the next 20 years or more, energy prices will go through the roof. What we have seen happen with oil is just the tip of the iceberg. We do not know where our energy supply—our natural resource—will be owned. Will it be owned in America or Germany? What influence will we have over that?
The Government has given away oil, electricity and gas, and now we are discussing renewables. Given that oil supply has peaked, everybody accepts that we need to find an answer to the energy supply problem in renewables. A race is on throughout the world in the development of that technology, but we in Scotland are about to hand it over to private companies. Renewables will be a higgledy-piggledy jigsaw puzzle.
I agree with Alex Johnstone: there is no strategic plan or strategy.
Will the member give way?
No thank you.
There is no way of working out where we will have the alternatives of wind, wave and biomass technology or how we will invest in such technology. How the technology will develop comes down to the figures in the papers of private companies' accountants; it is not for the Scottish Executive or the Scottish people, who are represented here, to decide. We need companies that are publicly owned and funded with strategic investment to develop renewables in Scotland.
We spent decades subsidising the nuclear industry because Governments thought—although I did not—that it was strategically important. The Government handed over £370 million to British Nuclear Fuels 18 months or two years ago. Every time that BNFL holds out its hand, the Government says "There you are", because of the problems with waste. The amount of public money that has gone into nuclear power is absolutely disgraceful. If we were to transfer that investment into publicly owned renewables, we might make some progress in this debate.
Are we going to have private nuclear power stations? Is that what the Tories are after? I would not trust any of the companies—where the dollar is the bottom line and the shareholders come before anything else—to run a private nuclear power station in Scotland. We saw what happened with the privatisation of rail and other services. Let us not go down that road. We need publicly owned, publicly funded companies with public profits going back into renewables.
I regret the distortion from Mary Scanlon, who has now departed the chamber. The MP for the Western Isles has called for a public inquiry, because consultation has been limited and the potential for intrusive imposition is high. Members should look at the map and see what is being proposed for the Western Isles. Nevertheless, the people who oppose the Western Isles development are in favour of wind farms. We have had one major distortion, which is enough.
The SNP is pro-enterprise and yet it is not unquestioning about the workings of the free market. We have major UK or international headquarters in only five sectors of our economy—oil and gas, banking and financial services, beverages, transport and electricity—whereas other developed countries have headquarters operating in their jurisdiction in 20 or more sectors. Two of our five sectors are energy sectors.
As Charlie Gordon told us, Scottish Power is a major part of those crucial sectors. It is our third-largest company and our largest industrial one. Given the criticality of energy in the economy and the potential for renewables in Scotland, it is important that the threatened E.ON or Scottish and Southern Energy takeovers evoke memories of the decision to maintain the independence of the Royal Bank of Scotland in 1981. By any definition, Scottish Power is strategically crucial to Scotland's future prospects; that is why we must ask questions about such takeovers.
Don Young, a former director of Redlands Aggregates, tells us that relatively few people benefit from such moves. Usually just the current senior management of both companies, the market makers, the stockbrokers, the corporate bankers, the lawyers and the accountants benefit; the shareholders rarely benefit. Those people who benefit want the churn of mergers and acquisitions and are less worried about optimisation of the economy as a whole. However, in a Scottish context, the latter objective is exactly what we should be out to achieve. After all, economic growth is the top priority.
Along with Charlie Gordon—we welcomed his speech today—we are of the firm opinion that there are grounds for referral of the proposed takeovers to the Competition Commission. Such a move proved to be right for RBS and Scotland in the 1980s and that strengthens our belief that it is right now for Scottish Power and Scotland. That is true, in particular, because we are on the cusp of a renewables bonanza, when it is critical that we lift all the Scottish boats as part of an economic revival.
The member referred to the situation with RBS in the early 1980s. How does he reconcile his position with the fact that RBS, having survived, went on to grow as an aggressive acquirer of companies beyond the United Kingdom and Scottish borders?
I reconcile my position readily. As I said, we have headquarters present in only five major sectors. Scotland has to maintain and grow from that base position as a branch economy—as created by the Tories—not to shrink further and become even more of a branch economy. In 30 years, including the 18 years of Thatcherism that Phil Gallie lauded, not one major Scottish company was created, other than through the privatisations and deregulation of buses. That is no badge of pride. We must stick with what we have and grow it.
Many jobs, including senior posts, would be at risk. Again, I welcome what Charlie Gordon said in that regard. On the basis of a clear-cut appreciation that the takeover would have a detrimental effect on many people, primarily those Scottish Power employees, we appeal to Scottish public opinion that we must use politics to maximise Scotland's future. Consumers can expect to continue to pay more than people pay elsewhere if they are charged by a supplier whose economic interests are unlikely to be those of the Scottish economy. Local Scottish suppliers would find, as countless have found before, that when control moves outwith Scotland, the new brand status instantly leads to less business, which reduces further over time.
We aspire to having Scotland run its own economy. With a takeover there would be fewer senior jobs to tax, fewer jobs in total and Scottish firms would pay more for energy and have smaller profits to tax. There is an issue for shareholders. There is plenty evidence to suggest that the long-term investor rarely does well out of such takeovers. A 1998 study by Daimler Chrysler showed that companies failed to thrive in 73 per cent of cross-border mergers.
The threat comes at a time when Scotland has suffered a 30-year period of low growth, which has caused massive social and economic problems and encouraged the Government to indulge in massive deception regarding our economic performance.
Masses of people, such as Tom Peters, Don Young, W Edwards Deming, Professor John Kay, who was here last week, Iain Macwhirter and Sir Iain Noble are queueing up to tell us that we need to indulge in Adam Smith's proposition of enlightened national self-interest. Scotland deserves a much more questioning approach from its political leaders, which is simply not forthcoming.
The situation is different now that people have the added clarity of seeing things in a post-McCrone-report era. Whether it was about our major oil reserves in the 1970s or whether it is about a major corporation now, facile compliance by the Government of Scotland is unacceptable. We cherish the proposition that we need to move forward and stop making it open season on Scottish assets while other countries cherish, nurture and root in place their assets.
The fact that, in 1981, the Royal Bank of Scotland's senior management backed the takeover of their own bank is evidence that Don Young was right: that would have been disastrous for Scotland. Imagine Scotland or Edinburgh without RBS. I urge members to support the motion in Richard Lochhead's name.
Before I call John Home Robertson, I advise the following speakers that they will have only five minutes. I call John Home Robertson, to be followed by Jamie McGrigor.
The SNP motion starts by expressing admirable aspirations for sustainability, the security of energy supplies and the elimination of fuel poverty. However it then goes adrift, rejecting the most likely solution to the imminent energy gap and concluding with the inevitable nationalist mantra about a constitutional solution to an engineering problem. Parliaments are wonderful institutions, but they are no substitute for power stations. It is not enough to vote for motions about secure supplies of electricity; we must provide for ways of physically generating the electricity that our communities and industries need.
Fuel poverty is a serious problem. We are helping by providing insulation and efficient heating for vulnerable citizens, but when there is a shortage of energy, market forces drive prices up and people on low incomes get cold. Insulation can provide only limited protection to pensioners if they are being held to ransom by energy suppliers. We are also becoming increasingly dependent on imports of gas and oil from sources that may not be entirely secure. Pipelines from central Asia and tankers from the middle east could be subject to all sorts of risks and threats.
It is madness to burn limited global resources of gas in power stations. Natural gas and oil are precious resources that should be used very efficiently and sparingly. The burning of fossil fuels also produces enormous quantities of carbon dioxide, which, as we now know, is causing global warming. It would, therefore, be wise to minimise the use of oil and gas in power stations.
The motion, rightly, refers to the energy gap. At present, Scotland is in the happy position of being more than self-sufficient for electricity. We have nearly 12,000MW of generating capacity, which leaves a good margin for safety over our peak domestic demand. We export a lot of electricity to other parts of the UK, as the minister said, and that is good for the economies of areas such as East Lothian, where people work at power stations and wind farms. The problem is that that will change.
Some of our power plant is nearing its retirement age. Cockenzie, Hunterston B and Longannet will have to close within the next 10 to 15 years, which will take 4,646MW out of our generating capacity. That will take us close to the safe margin for security of supply for Scottish homes and businesses. If we do not replace those power stations with new generators, we will eliminate our ability to export power and sacrifice a lot of jobs in Scotland. There are lessons to be learned from the power blackouts that have occurred in California, Italy and New York. If we do not plan for the future, that could happen here.
I support the Executive's ambition to increase generation from renewables. The target of generating 40 per cent of energy from renewables is phenomenally ambitious, but renewables can make a big contribution towards our energy mix for the future. However, even if we achieve the target of generating 40 per cent of energy from renewables, that will still leave 60 per cent to come from base-load power stations. That is the point that the nationalists are missing.
The lead time for making a business case for, planning and constructing a new power station is probably close to 10 years. The time has come to face up to our responsibility to plan for secure electricity supplies for the future. The responsibility for that planning decision lies here, in Scotland.
The last nuclear power station to be built took 12 years from the submission of planning to the completion of construction. Does the member not accept that the SNP, in our opening speeches, laid out options for plugging the energy gap with non-nuclear sources, which could be up and running much sooner than a new nuclear power station?
Mr Lochhead is overstepping himself. If he really thinks that we could fill the whole of the energy gap in that way, he is living in cloud-cuckoo-land.
The big question is where that 60 per cent of base-load electricity will come from. I mean what I say about the need for a mix. Some of that power should come from clean-coal technology, using Scottish coal. However, we should keep the use of oil and gas in power stations to an absolute minimum, for the reasons that I have explained.
The Executive has rejected, rightly, the idea of building new nuclear plant until decisions have been made about the safe storage of nuclear waste. Having listened to the Committee on Radioactive Waste Management and the nuclear decommissioning authority, and having read about the work of Nirex, we know that it is technically feasible to store nuclear waste safely. That is being done in Finland and lots of other places, and it will be done in Britain.
Will the member take an intervention?
I am sorry, but I am in my last minute.
The Prime Minister made an interesting speech in Brighton on 27 September. He concluded that we need an assessment of all energy options, including civil nuclear power. If Britain is going to consider the possibility of new nuclear generators as part of the energy mix, Scotland should not opt out of that process. It would be madness for us to sacrifice our share of the British electricity industry and to become dependent on imports of nuclear electricity from across the border.
Scotland has a lot of experience and expertise in the nuclear industry, at Torness, Hunterston, Chapelcross and Dounreay. For goodness' sake, British Energy used to be called Scottish Nuclear. Public opinion in those areas would not take kindly to a decision made by politicians in Edinburgh to reject building clean, new nuclear generators to replace decommissioned plant when the decision is made about the permanent storage of nuclear waste. Public opinion in other areas is shifting, too. How often have I heard people say that they would prefer nuclear power stations to wind farms?
The First Minister was absolutely right when he said, on 3 October:
"I think it's right and proper that … we keep energy options open."
He is serious about our energy policy for the future; I respectfully suggest that the SNP is not.
I am afraid that we are extremely short of time. Jamie McGrigor has five minutes.
I find myself in agreement with practically everything that John Home Robertson said.
Like many people in the Highlands and Islands, I am horrified by the number and sheer size of the new pylons that could be erected throughout the Highlands. If a subsea cable is planned to take electricity from Lewis to the Scottish mainland, surely it could stay subsea until it gets nearer to where most of the electricity will be used.
I was interested to hear Shiona Baird's comments. I believe that the Government should encourage micro wind turbines, which provide on-site generation of electricity. Unobtrusive small systems, which make individual houses and buildings energy independent or at least partly independent and save CO2 emissions, should be an important part of future energy policy.
I want to talk about fuel poverty. Too many Scottish households on lower incomes spend too high a proportion of their income on fuel costs. It remains a serious problem. The Executive must act now to ensure that continued support is available for those who need assistance in upgrading their heating systems and in improving the energy efficiency of their homes. It must also ensure a far better delivery of the schemes. At the moment, I am dealing with more than 80 cases to do with Eaga Partnership applications in the Highlands and Islands. Constituents have experienced significant delays in getting work done; there has been shoddy or even dangerous workmanship in some cases; and people have simply been denied such work on dubious grounds. Although there seems to be movement in some of the cases that I am dealing with—I congratulate the Eaga Partnership on that—too many are still waiting to be resolved.
I continue to highlight the issue and encourage more people to come forward with their experiences. Who knows how many more cases there are? Who knows how many elderly and vulnerable people in the Highlands and Islands face a cold winter without adequate heating because of the Scottish Executive's failure to ensure full delivery of its schemes? The Executive is always quick to congratulate itself; it must also take responsibility when things are not working. Although there are many cases in which work has been delivered successfully, there are just too many in which constituents have experienced real and potentially dangerous problems.
For example, a constituent in Grantown-on-Spey says that she feels that she is living in a "danger zone", with live wires protruding as a result of shoddy work. She calls it "a chapter of errors". A Shetland couple have waited two years for electric heaters to be installed. A lady in Campbeltown had a contractor who left a hot pipe uncovered and rubble under her carpets. Her carpets were ripped during the installation, her fire alarm was turned off for a week and a cable was left lying across the corridor upstairs at night. She ended up at the doctor's with stress. A constituent on Islay, whose heating broke down within a few weeks of its installation, repeatedly phoned Eaga and the local contractor to get the problem sorted out before she went to stay with her family for the winter. On her return, she was told that the guarantee had run out. A Caithness woman was told that she could not go on the scheme because she already had heating—a 20-year-old peat-burning Rayburn.
Will you be returning to the motion and the amendment at any stage, Mr McGrigor?
I am dealing with fuel poverty, which is mentioned in the motion.
In too many cases, contractors turn up when they have been advised that no one will be at home. I ask the Executive to do something for senior citizens such as those I have spoken about today.
You have one minute left.
I end by reading out one of the letters that I received from a constituent.
"Dear Jamie McGrigor, MSP,
I kept your letter from the Northern Times about difficulties people are experiencing in getting help with central heating …
I am a disabled woman of 75 living with my disabled husband of 80. Because of my disability I am unable to move rapidly to keep warm or wear thick clothes. I daren't get cold or my pain levels rise to a point where I am confined to a chair. It has taken me three years to achieve the vertical.
My central heating system was so old that it was repaired in January, February and March this year. I am lucky to have a plumber who understands my situation. I phoned EAGA on his last visit but they refused to replace the system because it had been repaired.
I applied for a grant through Care and Repair who awarded me £1696. Unfortunately my heating finally died during a cold snap at the end of May.
My gallant plumber put in a new system rapidly. It was his quote that had been accepted by Care and Repair. Unfortunately the grant hadn't been rubber-stamped before the work started although it was before the work was finished. Because of that the grant has been withdrawn.
I appealed to the Sutherland Committee who upheld the withdrawal because it would have set a precedent and have disastrous consequences on the Area Grant Budget.
I have thought a lot about it and it seems to"—
You must stop now.
— "me that a precedent must be set where a person's well-being is at risk. As the money was allocated, I don't"—
Mr McGrigor, I have been very careful to point out to you that you had five minutes; you are now well in excess of that. I am sorry to stop your speech, but I have to protect time for members later in the debate.
I shall, of course, keep strictly to five minutes. The debate is about whether the lights will go out all over Scotland. I do not think that the Scottish Conservatives' lights have ever been switched on, because some of the nonsense that we have heard from them about wind farms, for example, was beyond belief.
Being in favour of a wind farm strategy does not mean that one is in favour of every single wind farm proposal. It is like taxis in Edinburgh—we are in favour of taxis in Edinburgh, we just do not want too many taxis in Edinburgh or the abuse of any taxis in Edinburgh. Wind farms are in exactly the same category.
I do not have time to take an intervention from Mary Scanlon.
One of the great tragedies of the debate is that we do not have the study that the minister has promised by the end of the year. That will be a factual analysis of the supply and demand for energy in Scotland for the period ahead. It would be helpful to have that information so that the next time that we have an energy debate, we will be able to make a much better assessment of the energy gap that might arise in 15, 20 or 25 years.
Like the rest of the world, we have two major driving forces in energy policy. One is the insatiable demand for energy worldwide. In China and India alone, the annual demand for oil is rising by 16 per cent a year because of the massive industrialisation of those two countries.
The exponential increase in the demand for energy is side by side with the increasing evidence that if we do not do something about global warming, we will face very serious problems in the years ahead.
The question for this and every other country is how to strike a balance between satisfying the needs of industry and individuals for increased energy while at the same time protecting our planet from global warming.
Scotland is in a unique position. We are an energy-rich country: we are rich in oil; we have been rich in gas although it is a declining asset; we are rich in coal; and we are even rich in uranium deposits, which is not something to welcome particularly.
The nuclear argument must be argued on four key issues. I do not accept, as John Home Robertson tried to kid us on, that there is an acceptable solution to the problem of nuclear waste.
There is the issue of cost. The cost and economics of nuclear energy in the past have shown that it is not economically viable as a major energy source.
There is the problem of the potential for accidents. We have seen the results of the surveys in and around Dounreay, Rosyth and other areas where there has been potential for and actual fall-out of nuclear and radioactive material.
The final danger of which we must take cognisance in all energy policy is the threat of terrorism. If a terrorist attacks a coal-fired power station, they will do enormous damage and put people's lives at risk. However, if they successfully attack a nuclear power station, they could wipe out not just one community, but a whole country. Those facts cannot be ignored.
That is why nuclear, at the moment and for the foreseeable future, is not a viable or realistic option for Scotland or any civilised nation. That is why we have to look at all the other alternatives, including conservation. We are not doing nearly enough to conserve our energy at the present time.
It is unfortunate that I have run out of time—I made a commitment to keep my speech under five minutes, but there is so much more to say. I hope that the next time that we have a debate on energy we will have the facts and figures before us so that we can dispense with some of the nonsense that we have heard this morning.
Jackie Baillie has five minutes.
I will try to be equally disciplined. I share the analysis of the potential problem. We need to address security of supply, affordability, self-sufficiency, energy efficiency—all of that. However, the means of doing so suggested by the SNP is once again that we should haul up the ladder, close the doors, go it alone and effectively say, "Could the last person out please switch the light off?"
SNP policies lack credibility if every one is proposed through the constitutional prism. Remarkably, I agree with Shiona Baird's comments that the substance of what we do on energy policy is much more important than which body does it.
I will not spend a lot of time analysing the problem; others have done so before me. We can all trade the statistics about the increasing cost of oil, the reducing level of traditional supplies, our increasing dependence on imported energy and the gradual decline—which we will need to face—of supplies from the North sea. Businesses and domestic consumers can see that as energy prices rise.
Will the member give way?
No. None of Bruce Crawford's fellow party members took an intervention from me, so I will not take one from him.
I turn to the subject of fuel poverty. My starting point is to acknowledge the Executive's target to produce 40 per cent of our energy from renewable resources. Whether that is wind, wave, biomass or other emerging technologies, it is all critically important as part of a sustainable and balanced energy policy.
It is nonsense for members to say in the chamber that they support renewable energy, and yet to give in continuously to local pressure and block wind farm development out there. That is dishonest and it exposes the inconsistencies inherent in the SNP, not just here, but among its Westminster colleagues.
I agree with John Home Robertson: we need to focus our attention on the 60 per cent of energy that will potentially be missing in the future. Like Elaine Murray, I do not believe that we should exclude any potential future source of energy and that includes nuclear. The status quo is not an option; we need new, secure and affordable supplies.
We also need to look at the other side of the coin—we need to look at energy efficiency and approach the problem from the other end. At present, members assume that the supply of energy has to increase to meet ever rising demands. We need to consider that we already consume too much energy—a point that Shiona Baird made—and that the aim should be to cut back to make our energy use much more effective and efficient. In that regard, this Administration has raised housing standards to improve energy efficiency. For example, as members across the chamber have recognised, our central heating and warm deal programmes have insulated and heated thousands of homes across Scotland.
I should also point out that, since the central heating programme was introduced, nine out of 10 pensioners in Scotland have been lifted out of fuel poverty, with each household saving more than £300 per year. Because of the actions of this Labour Executive working—however much it might pain the SNP to hear it—in partnership with a Labour Government at Westminster, thousands of pensioners throughout Scotland do not need to choose between heating and eating. People without a central heating system get one and, thanks to Gordon Brown, every pensioner household receives £200 every single winter.
However, we must not rest there.
Will the member give way?
No.
I am pleased that ministers are thinking about how to expand the scheme and hope that they reflect on the speeches that have been made. Christine Grahame and Frances Curran know that fuel poverty is about income, physical improvements, energy efficiency and the cost of fuel. In recent weeks—and, in some cases, days—Scottish Gas, Scottish Power and Scottish and Southern Energy prices have gone up. A 5 per cent rise in the price of power automatically puts 30,000 households into fuel poverty.
My colleague John Home Robertson is right to say that we cannot tackle fuel poverty by energy efficiency measures alone. However, we cannot resolve the problem simply by being independent—the SNP's answer for everything—or by following the SSP's suggestion that everything should be renationalised. Both proposals are complete nonsense, all the more so because neither addresses the fundamental problem of how to deal with decreasing supply and increasing costs.
We need a mature debate on how we address the potential energy gap, because we have to come up with affordable and sustainable solutions that ensure energy supplies for future generations and tackle fuel poverty.
We move to closing speeches. I call Patrick Harvie to close for the Greens. Mr Harvie, you have a strict six minutes.
Thank you. I will try to do justice to a complex and interesting debate in those six minutes.
Richard Lochhead began by talking about national control. As SNP members well know, I agree with their objective on independence. However, to what end? Shiona Baird is right to say that, sometimes, the decisions that we take are more important than where we take them.
Allan Wilson was right to question the reference in the SNP motion to "self-sufficiency". Self-sufficiency should be about tapping into this country's local energy resources. That is our responsibility, and we are not yet exercising it adequately.
Members will disagree with very little of what has been said about fuel poverty. Certainly, no one can doubt the sincerity with which all members approach the issue. However, in the current context, only the lever of energy efficiency is fully available to us. We have no influence over fuel prices and very little influence over incomes.
At least the SNP's position on nuclear power is clearer than the Labour-Liberal Democrat sticking plaster. The almost innuendo of the coalition's claim that it will not embark on new nuclear generation programmes until waste management issues are resolved allows John Home Robertson to say, "Those issues will be resolved next year, and then we'll build the stations," and the Liberal Democrats to refer to some far-off, future technology that will make nuclear waste safe. That is not going to happen. When that sticking plaster has to be ripped off next year, we will see the divisions between Labour and the Liberal Democrats.
Richard Lochhead's speech clearly illustrated the SNP's addiction to burning Scotland's oil. In fact, in the recent Cathcart by-election, the only message that the SNP was putting out was:
"Stop the Rip-Off! SUPPORT THE SNP DRIVE FOR CHEAPER PETROL".
As John Home Robertson made clear, burning that oil is a waste of a precious resource that is likely to run out. However, my questions to the advocates of nuclear power who have spoken in this debate are: how renewable is uranium? How much high-grade uranium is out there? How long will it last? Will it last as long as—or longer than—the oil? What then? [Interruption.] If the minister wishes to intervene, he should do so on his feet. He is more than welcome to come in.
How does ruling out nuclear power for ever as a potential, alternative source of energy contribute to the Greens' stated objective of combating climate change?
As I was about to make clear, we might move on to low-grade uranium when high-grade uranium has gone, and processing that material will result in more CO2 emissions and an even greater contribution to climate change. People should not be allowed to suggest that nuclear power is a sustainable, CO2-free technology.
I do not have time to mention everyone's speech, but I say to Frances Curran that, one day, we might have an interesting discussion about the role of the public sector, the private sector and community-owned industries such as the Castlemilk wind farm that Nora Radcliffe mentioned and which is in Charlie Gordon's constituency. Such wind farms are smaller than Scottish Power, but equally worthy of note.
However, as far as renationalisation is concerned, state-owned oil is still oil; state-owned nuclear power is still nuclear power; and neither is sustainable. No matter whether it is operated by companies that are owned publicly, privately or by the community, renewable energy production is the way forward. Indeed, the debate should have focused on the source of our energy generation.
I have addressed nuclear power, but another of its advocates, Elaine Murray, referred to a criticism that Chris Ballance made about a biomass plant in Lockerbie. Like the rest of the Greens, Chris Ballance is a strong supporter of biomass, and his criticism centred on energy waste at the plant and the positive way in which other countries harness that waste.
Will the member give way?
I will, if the member is very brief.
Mr Harvie, you have one minute left.
Mr Ballance either must be mistaken or must have been misinformed. What he claims to be energy waste is used to dry willow and other forestry products for the next batch of biomass.
I will happily ask Mr Ballance to discuss the matter with Dr Murray. However, the fact that an estimated 100MW of waste heat is being poured into the atmosphere should certainly be addressed.
Alex Neil is always worth listening to in the chamber—
Mr Harvie, you have 30 seconds.
I have never had a 30-second warning before.
Alex Neil set out some of the debate's global aspects such as the exponential increase in energy demand. As a developed society, we have no right to expect developing countries to restrain themselves if we do not restrain ourselves. We need nothing less than a transition to a green society in which we live within our ecological means. That will not happen with nuclear power or with the current fossil fuel economy. We—
No, Mr Harvie. I gave you a strict six minutes. You are now over your time. I must stop you and call Euan Robson to close for the Liberal Democrats.
Mr Robson, you, too, have a strict six minutes.
I am grateful for the opportunity to close this debate for the Liberal Democrats. It is six years or more since I last gave a speech in a professional capacity on fuel poverty; for 12 years before that, the issue was high on my daily agenda at the now-dissolved Gas Consumers Council. This morning, I will focus on it again.
Obviously, I support the Executive amendment, particularly its important reference to
"a balanced energy supply mix".
I should point out that gas has an important role to play in base-load. Certain types of gas are not usable in domestic and industrial systems. For example, high-sulphur sour gas from the Miller field is burned at the combined cycle gas turbine at Peterhead. Such an approach is sensible. Even if imported, gas will remain an essential part of our energy supply mix. I realise that we must debate the components of that mix.
There is clearly a difference between the Liberal Democrats and Labour about the future of nuclear power, but that is something that we will all need to address when we come next year to the long-awaited but necessary review that the UK Government proposes.
I will use my short time to concentrate on fuel poverty. We know what the definition of fuel poverty is, but there is a part of that definition that is never given sufficient focus. The definition is that, in order to maintain a satisfactory heating regime, people are required to spend more than 10 per cent of their income on all household fuel. The difficulty is fairly obvious; it is to do with what is a satisfactory heating regime. That is the missing element in any debate. The definition refers to 10 per cent of income, but why not a lower figure? Why does it refer to all household fuel, however it is used?
The definition is there, although it is not as adequate as it might be, which is something that we need to look at. However, we all know what fuel poverty is when we see it. Anyone can appreciate intuitively what constitutes a cold, damp home. A number of us spent years explaining the link between bad health and poor housing when Government was trying its very hardest not to listen. As Christine Grahame said, the phenomenon of excess winter deaths is unknown in Scandinavia, where there is far better housing stock than we have here.
The figures are fairly clear and members have quoted them. The 2002 Scottish house condition survey showed that there were about 286,000 households in fuel poverty, and a 5 per cent increase in prices brings in another 30,000, so the number of households in fuel poverty at present is probably somewhere between 300,000 and 350,000. However, that figure is down from the figure in the 1996 survey, which showed that 738,000 households were in fuel poverty; we should not underestimate the impact of policy.
There is a conundrum in the definition of fuel poverty. In many houses where there is fuel poverty, there is simply no satisfactory heating regime. Eradicating fuel poverty in that context is unachievable, because the appliances are inadequate, out of date, obsolete or partial. To achieve a satisfactory heating regime in such households will require either appliance replacement or the introduction of an appliance or a heating system. That is why the Executive's programme is so important, but experience also demonstrates that energy use can and will rise as a result.
If Euan Robson is so keen to improve energy efficiency in homes, can he explain why the amendment to the Housing (Scotland) Bill relating to improved energy efficiency was not passed?
The amendment was not passed because it was defective. Nevertheless, we can come back to that, and we may well do so at stage 3.
More energy may need to be used to eradicate cold and damp in a home, even with a new appliance. Also, quite rightly, there may be a welcome increase in comfort levels in a home from an improved heating system. In circumstances where partial heating is replaced by full heating, energy use will rise. The point is that heating installations must be accompanied by energy efficiency measures, so when the Executive reviews its central heating programme, it must link the two. Much also depends upon the improved use of appliances and on better advice on their use. We have to redouble our efforts to ensure that greater advice is available when appliances are used, and the free central heating scheme must remain.
I shall make one final observation. Thirty years ago, huge numbers of central heating systems were installed, but they are now drawing to the end of their useful life. Failure to replace those old, inefficient appliances will inexorably draw vulnerable groups back into fuel poverty. Where are the resources to come from? The Executive will clearly continue to input finance, but I believe that there is no substitute for a part of the increase in fuel prices being devoted to energy efficiency measures. In days gone by, there was a proposal for an E factor. In fact, it was applied on gas bills for a while when there was a monopoly supplier. There is no substitute for going back to that regime when we come to review energy policy next year.
Unusually, I will start at the back end of the debate and pick up on the speech from Alex Neil, who, after a wondered start, got into the energy issues that we really have to face. I was surprised to hear Mr Neil's remarks, given his global perspective on the world economy and what goes on in other nations around the world. He suggested that there was no solution to the problems of nuclear waste. I suggest that he should look at Finland, France and the new, emerging economies, such as China, and ask why those countries have continued to develop nuclear programmes. They have done so on the firm basis that there is a solution to nuclear waste and that we should not take the depressed view that Alex Neil takes.
The same arguments must prevail with respect to economic issues. Those nations all see the benefit of nuclear programmes, and Europe as a whole has benefited from investment in them. In recent times, France and Finland have kept Europe's generation going—thank God they had those programmes.
Does Phil Gallie accept that countries such as France do not have the resources that Scotland has in oil, gas and all the alternatives? We do not need nuclear.
We do not want to burn oil and gas, because that has an adverse effect on climatic conditions. We want to use a source of energy that is friendly to the climate change aims that we all argue about.
I should declare an interest, Presiding Officer: as a former employee of Scottish Power, I am a small shareholder in that company. I point out to Frances Curran that I was also an employee of the South of Scotland Electricity Board and of the Central Electricity Generating Board—nationalised companies under the Government. From the time that they were privatised, fuel prices dropped by more than a third. That was something from which every citizen in the United Kingdom could benefit, and I ask Frances Curran to bear that in mind when she pursues her line of argument about nationalised industries.
I agree with the first part of the SNP's motion. If Christine Grahame were to look again, she would see that we accepted that. However, there are other aspects of the debate that I would like to draw to the attention of Parliament, and they concern the economic and social issues surrounding the supply of energy. Energy is the foundation on which our modern society is built; without secure energy, our homes, our streets, our industry and our businesses are lost. Our hospitals and schools are even more dependent on a secure supply of energy, which is the fundamental issue for Conservatives in this debate. The Conservatives have seen the light, and we want to ensure that it continues to shine all across our nation.
We are right to say that in our energy-rich Scotland there are oil and gas resources that can be used in future, but we must recognise that they are finite. In future, this nation will be entirely dependent on external sources, especially for gas, as John Home Robertson said. That poses a threat for whoever is looking after energy sources in this country. There is a place for wind generation, but I differ from the minister in that I think that the current renewables targets are far too ambitious. Wind generation is basically the only known way of meeting those objectives.
Does not Phil Gallie accept that hydro technology and biomass technology are both means by which we can provide critical base-load transmission from renewable sources?
I agree that we must invest in those technologies. It is interesting that although we have considered such initiatives in the past, nothing has ever really developed, even after great deliberations on projects such as the Severn barrage. Onward research is necessary.
Although there is potential in the waves, and we must investigate that option, above all we must ensure that we have a secure energy supply. In that context, I mention Europe, as members would expect me to do. I totally agree with the Lisbon agenda objectives on energy supply, and my feeling is that the targets that the minister has set perhaps threaten that.
I would like to respond to many comments that have been made.
But you do not have time.
I recognise the time limit.
Shiona Baird said that energy accounts for 79 per cent of Scotland's carbon emissions. I say to her that, in comparison with other nations, Scotland is a small player. Two coal-fired stations operate in Scotland, but China builds a coal-fired power station per week.
Mr Gallie, there is no time for you to continue. I cannot make the position any clearer. Allan Wilson has a strict seven minutes.
I share the common cause that has been displayed around the chamber with much of what Phil Gallie and Richard Lochhead said and with much of what is in the nationalists' motion.
The motion asks the right questions, but our problem with it is that it gives us no answer; worse, it would probably give us the wrong answers if we were to extrapolate from it. The motion also displays a paucity of ambition for Scotland in the energy context. On the contrary, the Executive's amendment reflects a commitment to a realistic balance, by tackling climate change, addressing energy inefficiencies and at the same time working with the United Kingdom Government, the industry regulators and generating companies to ensure security of supply and affordable energy for Scots.
On the scale of the Executive's ambition, from his discussions on issues that I have drawn to his attention, is the minister satisfied of the need to have imaginative and innovative renewable solutions, such as biomass projects for major public sector works? Is the Government demonstrating enough ambition to deliver those objectives? From where I am standing, that is not obvious.
John Swinney and I have discussed that issue on several occasions. I agree that historically we could have done more, but I am pleased to be able to tell him that in the near future we will make an important announcement on biomass, which I suspect will go a long way towards meeting his demands.
As if we needed to be reminded, today of all days, energy markets in Scotland are affected not only by UK markets but by what happens in global markets. In that context, Frances Curran's cheap jibe at Charlie Gordon was misplaced. Charlie Gordon is right to reflect his constituency interest with regard to Scottish Power. I can tell the Parliament that the First Minister has been approached to meet E.ON should a bid be realised. It is important to put the situation in context. FirstGroup, Scottish & Newcastle and the Royal Bank of Scotland have all benefited from foreign acquisitions; we cannot be hypocritical about such matters. As John Home Robertson and Elaine Murray said, we currently benefit from the market by exporting to those around us who consume more than we do.
In contrast, the approach in the SNP motion would cut electricity generation in Scotland by 30 to 40 per cent. The SNP's answer to the energy gap has come out in the debate, but it is contrary to everything that Jim Mather said about the sector leading economic growth in this country. The SNP says that the gap is to be filled by cutting capacity, or by—or presumably in concert with—burning more gas. It is interesting that the SNP would import the extra gas from England, which by then would be a foreign country. If SNP members cannot see the hypocrisy in that position, I am not sure what I can do.
I am not sure whether the minister has listened to a word that SNP members have said in the debate, because what he says bears no relation to what we said. The SNP has laid out a clear route map to meeting Scotland's energy needs without nuclear, but the minister says that he disagrees with that approach. Does that mean that he thinks that we could achieve our energy needs only with nuclear?
I intervened on Patrick Harvie on the matter. At the moment in history when global warming is the greatest challenge of the 21st century and energy policy is, as never before, based on a recognition of that fact, does it make sense to get rid of the one significant source of carbon-free generation that exists?
Will the member give way?
With respect, I will move on. If Patrick Harvie does not mind, I will not get caught on that particular hook.
What is interesting is what is not in the SNP motion. Alex Johnstone raised the tax regime in the North sea. At the SNP conference, Richard Lochhead called for equal taxes and carbon taxes to be on the agenda, because he saw Scotland not just as a world leader in the renewables sector but as the world leader. It is hypocritical of him not to say the same to Parliament and not to mention that while he talks about introducing new taxes, carbon taxes and equal taxes to protect the environment, his colleague Fergus Ewing stalks the country and in debates with Patrick Harvie and others calls for cuts in fuel duties and in petrol prices. There is rank and apparent hypocrisy in that position.
What serious political party other than the nationalists would talk about Scotland being the energy capital of Europe and, in the next breath, would recommend reducing energy output by 30 to 40 per cent, which would make us dependent on energy imports? That is some policy; we would be some capital. Intermittent generation cannot replace base-load, so to say that Scotland can chop off the nuclear contribution and be self-sufficient with the power that remains is a pretence on the part of the SNP. The reality is that the SNP's policy must be based on Scotland—like the rest of the UK—importing gas. In that context, Scotland would be no different from the rest of the UK. The inescapable logic of the SNP's position is that it would convert Scotland from being a net exporter of energy to England to being a net importer from England, which it would turn into a foreign country. [Laughter.] That is true. SNP members should deny it.
The nationalists talk a good game on renewables but, as many members have said, they do so only to mask the opportunism of their actions at a local level. They give no consistent support to projects that would turn targets into reality. Why have the nationalists not taken the opportunity today to support grid infrastructure?
Please conclude now.
On that point—
No, minister. I have to apply the same standards to you as I do to other members.
I thank members for what have been, for the most part, thoughtful speeches. As Richard Lochhead said, at the beginning of last year, when I was its convener, the Enterprise and Culture Committee produced a report on renewable energy. One of the report's unanimous conclusions was that the Executive should create a comprehensive energy policy. We made that recommendation for sound reasons, which have not lost any of their validity in the past 17 months. Many members have emphasised those reasons today, because they have become more compelling as global warming has become more of an issue; as our existing power stations near the end of their useful life; as our energy demands grow; as the Westminster Government seems to get nearer and nearer to making a decision in favour of building new nuclear power stations; as opposition grows to many proposals to generate or even transmit renewable energy; and as some of our external sources of fuel become politically more precarious.
The lack of direction that comes from the lack of a comprehensive energy policy causes us difficulty at different levels. At a national level, unless our policy is far clearer than it is now, it is difficult to see how the necessary stimulus—both to people who will do the generation and to manufacturers who make the equipment that will generate the power—can be given to whichever methods of generation we decide to favour. The uncertainty also causes great difficulty at local level, particularly for the only kind of renewables technology that is coming to maturity: wind technology.
Wind farms may well be ugly to some and beautiful to others, but the current lack of certainty about how much wind generation the Executive wants to see or where it wants to locate wind farms allows those who will brook wind farms at no price or in any place to conjure up exaggerated scare stories through which they would have us believe that there will be a wind farm on every hill and the whole of Scotland will be devastated and changed beyond recognition as a result.
Clearly, not every development is acceptable, but it is important that local communities and councils make decisions on proposed developments in the knowledge of the number of proposals that can reasonably be expected to be made. That context does not exist at present, so every member in this or any other chamber has the right to take a view on each project based on the merits of the individual project alone.
I will deal with some of the points that were raised in the debate, one of which was about Scottish exports of electricity. If Scotland were to become an independent country, electricity exports would be treated in the economic books in the same way as any other kind of export would be treated. The SNP believes that Scotland should continue to export electricity, particularly to those who are less fortunate in natural resources.
However, we would not generate that electricity in a way that damages our environment. Specifically, we would not do it by building new nuclear power stations, given their legacy of high costs before and during construction—and very high costs after they have been shut down—and of waste that remains for generations. Interestingly, the Scottish Executive's own report of a few years ago said that we had a capability in Scotland of 59GW of electricity; we need to view that against the current figure for total production in Scotland of 49GW.
Another point that was raised was cost. Alex Johnstone linked the issues of electricity efficiency, building regulations and cost. Two points arise, the first of which is that energy efficiency can often be built into houses. Doing so is part of good design; it does not need to cost more and, even when it does, there is a payback over the lifetime of the asset.
Alex Johnstone also raised a bizarre point about the oil industry, when he said that it would be in a sorry state if—and I paraphrase him—it was under the control of this chamber. It is sad to see a member run down the abilities of his country, his colleagues and himself in such a way. One wonders how small countries such as Norway manage to work hand in hand with the global oil industry.
Nora Radcliffe said that we should upgrade existing hydro. I agree, but one of the problems is that, under the current renewables obligation Scotland, assistance is given only to hydro developments of less than 20MW. In recent times, nine hydro stations have reduced their capacity as part of refurbishment in order to get financial support. The problem is that our rules seem not to be based on a coherent strategy.
In several interventions, Phil Gallie asked members to acknowledge that Scottish Power's existence is due to Mrs Thatcher and privatisation. I agree that Scottish Power was a result of privatisation, but the result could have come about in another way. There are other models: I ask Phil Gallie to consider the example of France, where EDF—Électricité de France—is still largely in state hands. The company is only now beginning to sell off some of its shares and yet it is one of the major world players—indeed, it owns several UK power plants.
The SNP motion notes that Scotland is an energy-rich country. We may be energy rich, but we must ask ourselves whether, with all that richness, we have done the best by our fellow citizens.
Will the member give way?
I am sorry.
We have not had the foresight of Norway, which has invested its vast oil revenues to the extent that the amount from interest on its oil fund alone is now as high as its annual oil revenues. Almost as much oil has yet to be extracted from the North sea as has come out of it to date. It is not too late for Scotland to be as prudent for the future as Norway was in the past.
It is not as if all that profligacy—the spending of all that oil wealth—without any provision for the future has brought us very much; otherwise, why would so many people in Scotland suffer from fuel poverty? Given that we have extracted so much cash from the energy of the North sea, why do so many people die unnecessarily from cold each winter?
We need to plan ahead more effectively. We need to use our resources better to exploit them for the benefit of the economy. We need to use energy much more efficiently and generate it much more cleanly. We need to make it easier for our engineers and scientists to invest in and mature the kind of energy technology that the whole world will need in the near future. We need to invest and not squander the income that we get from our energy richness. All the evidence of the past three decades shows that we will need to do that ourselves, in Scotland, because no one else will do it for us.