01-211 6402 PERSONAL AND CONFIDENTIAL 2...
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SECRETARY OF S T A T E FOR ENERGY THAMES MILLBANK
HOUSE LONDON
01-211
SOUTH SWIP
4QJ
6402
PERSONAL AND
CONFIDENTIAL
2£May 1979.
T.P. L a n k e s t e r , E s q . ,
Private Secretary to
the Prime M i n i s t e r ,
10 D o w n i n g S t r e e t ,
L o n d o n SW1.
PRIME M I N I S T E R S V I S I T TO THE
DEPARTMENT OF ENERGY
I a t t a c h a f i r s t - v e r y rough - d r a f t o f a
n o t e o f t h e p r i n c i p a l p o i n t s made i n
d i s c u s s i o n on F r i d a y . I ' l l be h a p p y t o
t a k e on b o a r d a n y comments y o u may h a v e .
The p r e c i s e s t y l e i n w h i c h i t i s r e p o r t e d
w i l l p l a i n l y d e p e n d on t h e c h o i c e o f
circulation.
Private
End.
Secretary.
DRAFT
P R I N C I P A L POINTS MADE BY THE PRIME MINISTER ON HER V I S I T TO
THE DEPARTMENT OF ENERGY : 18 MAY 1 9 7 9 .
Oil
The
Prime M i n i s t e r expressed
consumption i n c u r r e d agencies could
t h e v i e w t h a t J&*% c u t s i n
t h r o u g h o r on b e h a l f
n o t be t o p p r i o r i t i e s
o f i n t e r n a t i o n a l
f o r t h e UK* ' J t was much
more i m p o r t a n t t o k e e p i n d u s t r y g o i n g b y m a i n t a i n i n g supplies
of fuel.
figure of 5
o/
She was v e r y
adequate
concerned that a o p o o i f i e U o ^ X ^
wn? a b l a n i r o d F G O t r i e ^ i o n
which d i d n o t take
s u f f i c i e n t account o f the circumstances o f i n d i v i d u a l on f u e l
Generally if
there
should
stocks
f o r t h e coming w i n t e r
be a n y d i f f i c u l t i e s
n e e d o f maximum r e s e r v e s
of other
i n supply
fuels,and
c o n t r i b u t i o n t o w a r d s f l e x i b i l i t y we s h o u l d fired with steps
power s t a t i o n s . supplies
I f there
should
countries.
she noted
that
felt
that as a
h a v e more
dual
p r o v e t o be d i f f i c u l t i e s
i t w o u l d be a b s u r d n o t t o h a v e t a k e n a n y p o s s i b l e
s p e c i f i c a l l y what c o n s t r a i n t s a p p l i e d
to t h e import o f coal
t o support c o a l s t o c k s . / I h e ~ e n q u i r e d about the
v
*
*
causes o f t h e d e c l i n e in/^exploJHfation/ana
as to the r i g h "
b a l a n c e , o f i n o e n t i v e a n d c o m p u l s i o n f o r f u t u r e p o l i c y , c m d;
felt
that
regardless
t h e r e Jwas a r e a l r i s k of
h a v e a d a m a g i n g J e f f e e t on
ime
we w o u l a h a v e
towards s e c u r i n g a l t e r n a t i v e s u p p l i e s , and she asked
i n order
that
balancing confidence.
e a i r o t e would
do w i t k t h e
M i n i s t e r a s k e d what wo WOPO
£J00 m i l l i o n l o s s w h i c h t h e NCB e x p e c t e d t o make t h i s
•VI 1
year
DRAFT/2.
St^ant? r e c a l l e d t h a t G o v e r n m e n t ' s r e l a t i o n s w i t h
t h e NCB
had
l a r g e l y c o n s i s t e d o f a '^offie <^*of w r i t e - o f f s f o r so l o n g c o u l d remember.
she
before
i t could
be
She
a s k e d how
c l o s e d , and
much a p i t had
as
t o be
expressed confidence
losing
t h a t many
m i n e r s w o u l d be h a p p y t o accept" c l o s u r e p r o v i d i n g t h a t were g i v e n g e n e r o u s t e r m s o f r e d u n d a n c y . c i t e d a s an a r e a w h e r e e x t e n s i v e
was—horrr~8nxf~15re<5. ia^B^^Bxea^yf t h a ^ t ^ f e i f e r ^ w € f i * e ^ t o o few
v^ry
much hopftd t h i n
d i f f i c u l t y i n seeing continuously
the^s'elvoir
t h e monoy w h i c h t h e
%heht (over t h e
been p u t
had
Government
had
f r e q u e n t l y been p r o m i s e d t h a t a few w o u l d see
the
i n d u s t r y round the
great
kind of serious
l i k e l i h o o d of
i r . Sho
years o f her knowledge of the
she
Britain..and She
c o n l i n d u s t r y as a n y
t h e money w h i c h had
prevented
development
areas l e f t i n
i n v e s t m e n t p r o p o s i t i o n ^ ; * * t h e r e r e m a i n e d no r e t u r n on
not
was
She i-smarke& t h a t
p r o j e c t would r i o t prooood.
i n t o the
put
Rhondda
p i t c l o s u r e s had
the development of economic p r o s p e r i t y .
felt
The
they
«h
a
y o o a l l o d agaiw
industry^it
more y e a r s o f
had
investment
U
corner U.I'Jm
Electricity
On
r e - o r g a n i s a t i o n , the
been a b l e was
t o see
against
otherwise
the
P r i m e M i n i s t e r s a i d t h a t she
had
case f o r a f u r t h e r r e - o r g a n i s a t i o n .
i t b e c a u s e i t t e n d e d t o a b s o r b e n e r g y Which
be a p g l i e d t c t h e p r o b l e m s w h i c h t h e
industry
never
She
could
faced.'
•
There had -fulled
been ^any PO orgsuaisationc i n the paot which h i d
I .
lu yiuJudc a w h o l l y s a t i o f a c t o r y r t m i t u r e and she
f-alt theae- was She
I need ,to i n j e c t more c o m p e t i t i o n
r e c a l l e d t h a t the
r e a r s ago
Conservative
P a r t y had
i n t o the
field.
s u g g e s t e d many
a s t r u c t u r e o f r e g i o n a l power b o a r d s , r a t h e r t h a n a
V
DRAPT/3.
c e n t r a l i s e d i n d u s t r y and
remarked that she
felt
i t would
be
h i g h l y b e n e f i c i a l i f the consumer could have the o p t i o n of buying
surplus who
e l e c t r i c i t y from any
producer-such as a l o c a l manufacturer-,
might happen to have excess production,
t i e d to a -CEGB monopoly. the i n d u s t r y ^ s h e
r a t h e r than
Rather than a r e - o r g a n i s a t i o n
would l i k e to see f a i r l y small
open the i n d u s t r y up
to competition
"V?r why
changes to
to the Tr-ado
^^orrjitiarytm- Competition B i l l which i s being' d^volojo^d She
of
and wondered whether i t
would be p o s s i b l e to a'ad something to t h i s end
moment.
being
remarked on the d i f f i c u l t i e s which had
the d e c i s i o n by the i n d u s t r y to use
at the
attended
500 Mw/sets and
expressed s u r p r i s e that more a t t e n t i o n had not
wondered
the Government d i d not have the power to discourage
Board from such imprudent t e c h n o l o g i c a l adventures.
_)
;he
She
also
been g i v e n
over
0
the years to the r e l a t i v e l y high l o s s e s ofr the
electricity
^J>^
Nuclear
—t**.
The
Prime M i n i s t e r s a i d that she was
and
b e l i e v e d that we would only come cl
problems i n energy supply when we of e l e t t ^ Q j L see
from n u c l e a r
power.
the C D F R . p r C j e c t proceed.
She
very keen on n u e l e a - power
had
a
s u b s t a n t i a l .prfflfl la^lbw
She would very much Like to was
not i m tho l o a o t
-by. the Three M i l e I s l a n d i n c i d e n t and wan
:
e«n^erS*. in
engineers
cut cfcrners i n a way-that mig>t expose us to
similar
£ he noted w i t h r e g r e t that the French •#*ucluui"' orogramme
fast reactors w h i ^ ^ ^ * I ^ g m ^ * ^ p ^ ^ ^ ^ ^ f i r
ci£ us-.
worried
oure that wjiuu-^sueh
raaetoye ofuno \p be oono true ted i n t h i o eemxtnry mfc woul not
ou
,
She
<
noted that the Government was
p
ww° nnw
committed to a
ahead
DRAPT/4.
major p u b l i c enquiry move a h e a d as noted the
on
f a s t as
the
CDFR b u t
possible w i t h i n that
d e s i r a b i l i t y of ensuring
problems were f u l l y worked out work comnenced, as had
She
felt
would l i k e
not
before
commendei a l e c t u r e ^ w h i c h that a c r i t i c a l
place-would
f o r the
the
the
be m a k i n g
programme.
great and
o f c o a l as
a fuel^had i t
e x p l o i t a t i o n o f c o a l became common
I f we
were t c have a d e q u a t e s u p p l i e s
future this re-assurance
by t h e
She
r e m a r k e d on n u c l e a r
w a s t e t h a t she
v o l u m e o f w a s t e w h i c h was e f f i c i e n t way
produced.
of d e a l i n g w i t h
of
power was
had
She
not
energy
^
need^i*
essential.
been b o r r i f i o d
by
the
h o p e d t h a t some more
such a l a r g e q u a n t i t y of
founcL^ nnrl thn I in
messy
Government o f t h e
fundamental a c c e p t a b i l i t y of^nuclear
be
f i r s t AGR
S i r J o h n H i l l fead g i v o n whiej*^ r e m a r k e d
and
could
She
c e r t a i n l y h a v e condemned s u c h a d a n g e r o u s and
power s o u r c e .
material
h r ^ i p n n r i ^ n r *
•foreign technology for. t h i o purposei
Gas
The
P r i m e M i n i s t e r h o p e d t h a t t h e p r i c e o f gas
increased t h e new
f o r r e a s o n s o f e n e r g y p o l i c y a Lone.
G o v e r n m A i t had
pressures
which
t h r o u g h the additions
to
foould
system. thase.
i n h e r i t e d a great h a v e t o be a l l o w e d
She
fool j*»ju}'
construction
jower^infc. p o s i t i v e l i g h t
a n a l y s i s o f the use
been p e r f o r m e d b e f o r e
constraint.
relevant
happened w i t h
to p r e s e n t n u c l e a r
^hia'Jwf
that a l l engineering
t h a t a l l o f t h o s e c o n c e r n e d sho i l d
efforts
t o se seee
would not
would not
be
She
that
noted
many i n f l a t i o n a r y
to work t h e i r
w i s h to see
way
unnecessary
WW*** . - *
DRAFT/5
BNOC The P r i m e M i n i s t e r
made c l e a r
t h a t s h e s a w no v a l u e i n h a v i n g
a n o t h e r c o m m e r c i a l o i l company. real restraints existing
accooomoat a# / B N O C * ^ . r o l g - i i a i t s
on a
c o n t r a c t s and commitments w h i c h w o u l d h a v e t o be
respected. interest
She n a t e d t h a t t h e r e w e r e
She saw no a d v a n t a g e o f s e l l i n g o f f a
public
i n BNOC, on ^he l i n e s o f BP, a n d w o u l d p r e f e r t o
dismember i t .
The eqi i t y i n t e r e s t s
c o u l d be s o l d
offy s u b j e c t
t o f.ny J ^ j J ^ T s ^ p - r e q u i i ed t o r e t a i n af%»5flHGJ8??(? U K - 4 ^ e r e o t - i n the
UKCS o r t o r e t a i n Government c o n t r o l .
She was n o t c o n v i n c e d
t h a t h a v i n g o i l i n t h e hands o f BNOC p u t t h e Government i n a n y rgtJi
stronger position i * ^ i n
xim
i n o f f o c f y i g EEC r e s t r i c t i o n s than-set w o u l d
t h e a b s e n c e o f BNOC.
1
4
*
