Press Office

Aired: Sunday, 25 July, 2010 10:00
Sunday Live with Adam Boulton

Any quotes used must be attributed to Sky News, Sunday Live with Adam Boulton

ADAM BOULTON:

On Tuesday the new government makes its first major statement on energy provision, bracing the country for a huge increase in wind turbines. With me now is the Energy Secretary, the Liberal Democrat MP Chris Huhne, a man who played a key role in brokering the coalition government, welcome to you indeed. The basic message on energy, I keep on reading this, is if we carry on as we are we are going to have an energy shortage and a real crisis in a decade or so.

CHRIS HUHNE:
We can’t carry on as we are, we’ve got to make sure we are more energy independent, that we’re producing more electricity at home. We are going to have an economy which is increasingly electric, where we are using electric vehicles, where we are using electricity for all sorts of our needs and we need to have a whole array of power sources to make sure that we are generating that and that we are moving from a situation where we are going to be very dependent on imports over the next ten years back to a situation of the sort we were in when we had a lot from North Sea oil and gas and were more independent.

ADAM BOULTON:
I also encounter a lot of businessmen who say to me, well the only answer is nuclear power.

CHRIS HUHNE:
Well I think we will put in place a framework of incentives to make sure we become more energy independent and that we decarbonise the economy, in other words that we move towards a low carbon, low emitting sources of energy. Then it is up to the marketplace to decide but I expect that there will be investment in nuclear. We have two big major global players, both EDF in France and RWE in Germany who very interested in investing very heavily in the prospect of new nuclear power stations.

ADAM BOULTON:
Can you really leave it to the market? It is strategically so important to the country but also so costly that in the end industry needs some sort of subsidy, some sort of support.

CHRIS HUHNE:
Industry needs a very clear framework and my job is to make sure that the framework is there so that whatever detailed decisions are taken by businesses and by the marketplace, we end up with a situation where we have low carbon electricity and we are more independent from the sort of pretty horrendous shocks that we are likely to get from geopolitically stressed parts of the world like the Middle East and Russia.

ADAM BOULTON:
You believe that wind turbines, I mean what percentage of our energy do you think wind turbines …

CHRIS HUHNE:
At the moment, overall renewables are responsible for a little less than 3% of our total energy and we are committed on the legal targets for getting that up to 15%.

ADAM BOULTON:
By 2020.

CHRIS HUHNE:
By 2020, so we are the third lowest in all of the member states of the European Union, all of the other European countries have already decided that it makes sense to go further and faster than us on renewables. Now it is part of a portfolio of different sources of energy which is going to include nuclear and also carbon capture and storage …

ADAM BOULTON:
So can you hit those renewable targets do you think?

CHRIS HUHNE:
I think we can, I think it’s a stretch, I think it’s ambitious but I think we can hit it and I think it’s important that we do because it does provide us with a guarantee against these big oil and gas price shocks which in the past have always derailed the economy.

ADAM BOULTON:
And that involves offshore and onshore both?

CHRIS HUHNE:
Well onshore at the moment is very interesting because actually although there are a lot of public concerns often when there are proposals for it, the costs of onshore have now come down so much that they are competitive with other sources of energy. Offshore similarly coming down but we have enormous potential offshore. I mentioned for example Dogger Bank which is a shallow area of the North Sea the size of Wales …

ADAM BOULTON:
An the north east of England is becoming a bit of a hub for developing these.

CHRIS HUHNE:
The north east and Scotland. I think we have immense capacity for renewables, not just wind but also tidal stream and wave.

ADAM BOULTON:
And when you are looking at onshore are we talking about every home having a windmill in the back garden or are we talking about big blots on the landscape?

CHRIS HUHNE:
No, I can say absolutely certainly that we are not talking about every home having a windmill. I have got one on my constituency home and it is touch and go as to whether it is really commercially viable. It was a nice idea but I don’t know if it really makes sense particularly in more urban areas because what you get is not enough wind frankly but there are parts of the country where certainly people will come forward with proposals and I for example have said already that local authorities should be able to pioneer some of these things and feed their electricity into the grid.

ADAM BOULTON:
So while you say you won’t be subsidising nuclear, you will be subsidising wind and renewables?

CHRIS HUHNE:
I think there is a big difference between two different types of subject here. One is that we have to have an overall framework to make sure that we get low carbon electricity and that we become more energy self sufficient, that will be available to everybody but no special subsidies for nuclear compared with these infant technologies precisely because nuclear is not an infant technology in the same way. All the economic literature tells us that yes, it is legitimate for the government to do what we did with onshore wind, encourage it at the beginning and then later when it becomes cost competitive it can fly on its own but with nuclear it has been there now for many decades and it doesn’t deserve that sort of infant industry subsidy.

ADAM BOULTON:
Now you have already warned about a possible oil shock so obviously there is a demand for more oil but knowing what we now know about the Gulf of Mexico, should BP be starting deep, even deeper drilling off Libya given the environmental concerns?

CHRIS HUHNE:
Well that’s really up to Libya. I hope very much that countries looking at the possibilities of deep sea drilling do as we have done and as other regions have done and make sure that the regime for regulating that work is really tough.

ADAM BOULTON:
As the Americans didn’t do?

CHRIS HUHNE:
Well the Americans I think certainly have lessons to learn. I mean we had our own disaster back in the 1980s, Piper Alpha, and as a result of that we toughened up our regulatory regime, we split out the operational licensing from the health and safety regulation which the Americans hadn’t done in the Gulf of Mexico but I am sure there will be further lessons to learn when we get the results of the Presidential Enquiry and the other enquiries into what happened.

ADAM BOULTON:
What is your view? You have obviously been deeply in touch with the government, do you think they have made very serious mistakes?

CHRIS HUHNE:
Well we have been briefed on a weekly basis by BP and I think we have to wait to see what are the results of the enquiry, it’s wrong frankly to pre-judge what is a very in depth enquiry, there are a lot of technical questions, there are always potential human errors, technical errors and we have got to make sure we know exactly what went wrong so we can make sure it doesn’t happen again.

ADAM BOULTON:
And changes at the top, would they help?

CHRIS HUHNE:
Well I see speculation continues that Tony Hayward, the chief executive of BP, may have to move on but that is obviously a matter entirely for BP and it is a very strong company with I think a lot of talent at the top and I very much hope it is able to continue playing a very important economic role in both the UK and the US. We actually own very similar shareholdings in BP, it is almost like an Anglo American company.

ADAM BOULTON:
Speaking of strong companies at the top, what about the Brokeback Coalition?

CHRIS HUHNE:
Well David Davis I noticed, he was quoted as saying that he quoting somebody else and he had been misquoted so I think that that was … I don't think it should be taken too seriously.

ADAM BOULTON:
It’s going to stick though isn’t it?

CHRIS HUHNE:
Well what people say in the privacy of a City bar after a few drinks in my experience is not necessarily something that they consider …

ADAM BOULTON:
What about what you say in the privacy of the Chequers dining room at the political cabinet on Friday? You were looking at the political direction of the government and it would seem for your part of the Liberal Democrats to be pretty gloomy, down to 13%.

CHRIS HUHNE:
I don't think so. I can remember being a member of my party when we were so low in the polls that we were an asterisk under Paddy Ashdown and within the margin of error so the reality is that my party is very used to having opinion polls bounce around but the only poll that really matters is the poll when people go out and put their cross by the party that they prefer and I’ll just remind you that ever since the 1970s we’ve been on a rising trend and I think that will continue and I think our participation in government will be very important in that because one of the things which has traditionally caused people to be reluctant to vote for the Liberal Democrats is that we thought we couldn’t actually deliver on real objectives and what they are going to see I believe at the next election is they are going to be able to identify really big important changes, like for example the number of people taken out of income tax which is solely due to the Liberal Democrats.

ADAM BOULTON:
So you don’t feel that you are giving cover to the Tories at the expense of your principles?

CHRIS HUHNE:
I notice that there are some back bench voices, a very small minority in both the Liberal Democrat party and in the Conservative party …

ADAM BOULTON:
Not in the Labour party.

CHRIS HUHNE:
Well the Labour party is obviously going to say whatever the Labour party says but there are some back bench voices who are saying that the other party is getting a better deal. Now at the moment they seem to be fairly equal, there are some right wingers in the Tory party saying the Liberal Democrats are running away with it, there are some people in the Liberal Democrats saying the Tories are running away with it. Well, rather like the BBC when it gets equal number of complaints from both sides and so they must be getting it right, it suggest to me that if we have got that sort of balance then I think we are getting it right.

ADAM BOULTON:
What happens if the referendum goes ahead and the Liberal Democrats get a no vote on alternative voting.

CHRIS HUHNE:
Well we have no intention on getting a no vote.

ADAM BOULTON:
Even if you have David Cameron campaigning against you?

CHRIS HUHNE:
Well we’ll see. I think that the really key thing is that it is the first time that the British people have ever had an opportunity to make a judgement about how they want to elect their own MPs and the system that has been proposed is not the ideal system but it is a serious step in the direction of fairness because it means every single MP will get more than half of the votes within their constituency and that will provide them with an enormously stronger mandate than the one they have at the moment. At the moment we can elect people with just a quarter of the vote.

ADAM BOULTON:
How do you win though with the Conservatives being opposed and large sections of the …?

CHRIS HUHNE:
We went with the strength of our argument and the strength of the argument is absolutely enormous, precisely because we have such a ludicrously unfair system at the moment. If you look at first past the post you get bizarre results, often parties get more votes and if you look back at our history a different government is elected. You get no relationship between what people have voted and …

ADAM BOULTON:
But it might not go your way, if it doesn’t go your way does it mean that …?

CHRIS HUHNE:
All sorts of things might or might not happen but our intention is that we are going to make sure we put those arguments as strongly as possible and I am absolutely confident that when that argument is had, when people see the benefits of voting one, two, three, four rather than just a simple X which was after all always the mark of illiteracy historically, I think they are going to say yes, let’s have more choice. You go to the supermarket, you go shopping, you get a lot more choice today than you ever had before. All we are saying is here with the electoral system, let’s have a lot more choice.

ADAM BOULTON:
Chris Huhne, thank you very much indeed.