Energy Price Freeze

Debate between Alan Whitehead and Baroness Primarolo

Wednesday 6th November 2013 Commons Chamber

[Dr Whitehead]

Obviously, the world gas price varies considerably. The UK market is currently based around the gas price. If gas is no longer the market-maker over the medium and long term, a number of interesting consequences will arise, particularly in terms of how we would relate volatile markets to retail prices.

That is one of the issues that would be dealt with by the Opposition’s proposals to introduce a pool. If there is a pool into which everybody transparently sells their products and the pool then sells to energy retailers, that would deal with a number of problems that have arisen as a result of the imperfections in the market, and which would remain despite the Energy Bill trying hard to address them. If there was a pool, they would be dealt with even if gas was still the market-maker, but the market would be much more efficient in the long term if that was not the case.

We should consider in this context the fact that independent generators do not believe they have a clear market for their products. That issue remains unsolved by the Energy Bill provisions. If there were a pool, it would be substantially solved in as much as they would know they had a buyer into the pool and a seller out from the pool. If the current dysfunctional market were reset in the way the Opposition propose—with a price freeze while the market is reset, a pool, and a regulator that can properly relate what is happening in world prices to how they are being passed on through the pool and out the other side—a lot of the issues we have been talking about today would become far more simple and transparent, and the future solutions would be customer-oriented.

I do not say that that would solve the problem of increased energy prices in the future, because it is certainly true that world energy prices continue to increase and that there would be price increases for the consumer. It is not true, incidentally, that under those circumstances energy companies would simply take back the money lost during a price freeze, because there would be regulation reflecting world prices. Although prices have gone up, the world gas price has not gone up over the past year and a half. A fair relationship between world energy prices and retail prices could be achieved through a combination of new forms of regulation, an energy pool and a reset of the market.

We must look at these proposals as part of a wider package that, at its heart, is on the side of the consumer. At present we have a dysfunctional market that will never end up on the side of the consumer unless it is fundamentally reset so that it points in the right direction. My sorrow is that, although the Energy Bill has many good provisions that deserve to be supported, it does not do that, and that is what the Opposition proposals are trying to do, and that is why they should be looked at seriously—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Time is up. I call Debbie Abrahams.

Fisheries

Debate between Alan Whitehead and Baroness Primarolo

Thursday 12th May 2011 Commons Chamber

[Neil Carmichael (Stroud) (Con)]

The hon. Gentleman is absolutely right. I generally welcome the motion and will be happy to support it, because it is absolutely necessary that we have a different approach to the common fisheries policy. I wish to draw the House’s attention to a report produced many years ago by a House of Lords Committee, which highlighted the need to apply science and technology—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. The hon. Gentleman is making an intervention. If he wishes to draw the House’s attention to something, he can make a speech, but he cannot do so in an intervention, so we will leave it at that.

[Dr Whitehead]

I thank the hon. Gentleman for his intervention. If he wishes to intervene again briefly, I will give way.