Department for Energy Security & Net Zero

There was no allocation for debt servicing within the Energy Price Guarantee.

The ECO scheme is not funded directly by government, rather it is funded by obligated energy suppliers who then recoup the cost from their domestic customers. Government does not hold data on the geographical distribution of ECO spending.

To end of December 2023 (the latest available data) ECO schemes have supported the installation of 2,668 measures in 2,069 homes in the Suffolk Coastal constituency.

Source: https://www.gov.uk/government/statistics/household-energy-efficiency-statistics-headline-release-april-2024.

On 30 March, my Rt Hon Friend the Secretary of State and I wrote to the Chief Executive of Ofgem, highlighting the importance of keeping standing charges as low as possible.

Ofgem launched a call for input in November 2023 on standing charges in the non-domestic and domestic retail markets, looking at how they are applied to energy bills and what alternatives could be considered. Ofgem is currently analysing the responses and will publish its response in due course.

Ofgem issued a Call for Input on standing charges which closed on 20 January 2024. It included an invitation to submit views on the issues affecting standing charges in the non-domestic retail sector. Ofgem are currently analysing responses and reviewing the make-up and structure of standing charges.

The Government recognises that businesses are facing pressure through their energy bills. That is why on 30 March 2024, my Rt Hon Friend the Secretary of State and I wrote to Ofgem, highlighting the importance of keeping standing charges as low as possible.

https://twitter.com/ClaireCoutinho/status/1774001008953217079

The Boiler Upgrade Scheme provides grants of £7,500 to support the installation of air source, ground source and water source heat pumps including plants installed as part of a shared ground loop. We are increasing the shared ground loops system capacity limit in May from 45kW to 300kW to address the concerns that groundworks for ground source heat pumps are a significant barrier to deployment.

Shared ground loop installations which satisfy the eligibility criteria for the Green Heat Network Fund can apply to the scheme for support. To be eligible, applicants must demonstrate that their networks can deliver a minimum of 2GWh per year of heat.

The Government ‘help to heat’ schemes supports deployment of low carbon heating in rural areas through ECO, Wave 2 of SHDF and HUG2.

The Boiler Upgrade Scheme also provides grants of £7,500 towards upfront cost and installation of air and ground source heat pumps. Up to the end of February 2024, 57% of grants paid out were for clean heat installations in rural areas

Through the Heat Network Transformation Programme, the Government is working with industry and local authorities to develop new heat networks and improve existing ones, including investing £500 million half a billion pounds in funds.

I refer my hon Friend to the answer I gave on 21 March 2024 to my hon Friend the Member for St Ives (Derek Thomas) to Question UIN 18922.

Licensing is matter for the expert independent regulator, Ofgem. Licence conditions require that a customer’s bill is based on the best available metering information, and that where a supplier visits a customer’s premises, staff are properly trained to carry out such visits safely and effectively. Suppliers must take all reasonable steps to obtain meter readings at least annually.

National Grid ESO manages network constraints. In 2023, constraint costs were £1.4bn and the volume of balancing services used to manage constraints was around 12TWh. Data are not available on exact timing of curtailment and the split of costs between renewable and gas generators in 2023.

The Government is working with Ofgem and network companies to accelerate network delivery in line with the Winser recommendations and is halving the construction time of new transmission infrastructure from 14 years to 7, delivering the grid capacity needed to alleviate network constraints. The Review of Electricity Market Arrangements consultation considers several options which could help to reduce constraint costs, including locational pricing, electricity storage deployment and establishing constraints markets.

National Grid ESO manages network constraints. In 2023, constraint costs were £1.4bn and the volume of balancing services used to manage constraints was around 12TWh. Data are not available on exact timing of curtailment and the split of costs between renewable and gas generators in 2023.

The Government is working with Ofgem and network companies to accelerate network delivery in line with the Winser recommendations and is halving the construction time of new transmission infrastructure from 14 years to 7, delivering the grid capacity needed to alleviate network constraints. The Review of Electricity Market Arrangements consultation considers several options which could help to reduce constraint costs, including locational pricing, electricity storage deployment and establishing constraints markets.

National Grid ESO manages network constraints. In 2023, constraint costs were £1.4bn and the volume of balancing services used to manage constraints was around 12TWh. Data are not available on exact timing of curtailment and the split of costs between renewable and gas generators in 2023.

The Government is working with Ofgem and network companies to accelerate network delivery in line with the Winser recommendations and is halving the construction time of new transmission infrastructure from 14 years to 7, delivering the grid capacity needed to alleviate network constraints. The Review of Electricity Market Arrangements consultation considers several options which could help to reduce constraint costs, including locational pricing, electricity storage deployment and establishing constraints markets.

National Grid ESO manages network constraints. In 2023, constraint costs were £1.4bn and the volume of balancing services used to manage constraints was around 12TWh. Data are not available on exact timing of curtailment and the split of costs between renewable and gas generators in 2023.

The Government is working with Ofgem and network companies to accelerate network delivery in line with the Winser recommendations and is halving the construction time of new transmission infrastructure from 14 years to 7, delivering the grid capacity needed to alleviate network constraints. The Review of Electricity Market Arrangements consultation considers several options which could help to reduce constraint costs, including locational pricing, electricity storage deployment and establishing constraints markets.

The UK is the first major economy to halve its emissions – having cut them by around 53% between 1990 and 2023. We have the most ambitious 2030 emissions reduction target of any major economy.

The UK over-achieved against the first, second and third carbon budgets. Taken together, the policies set out in last year’s Carbon Budget Delivery Plan keep us on track for Carbon Budgets 4, 5 and 6, our 2030 Nationally Determined Contribution, and ultimately for net zero by 2050.

Renewables, which have increased from 7% in 2010 to nearly half of our electricity generation, will help ensure our energy security – providing homegrown energy, and reducing our exposure to volatile fossil fuel markets. The UK is home to the five largest operational offshore wind farm projects in the world and no country has built more offshore wind than the UK bar China.

The Net Zero Innovation Board provides strategic oversight of government funding of net zero innovation programmes and has met four times since February 2023 – in July, October and December 2023 and March 2024.

The Net Zero Innovation Board provides strategic oversight of government funding of net zero innovation programmes and has met four times since February 2023 – in July, October and December 2023 and March 2024.

The Net Zero Council has met four times since it was established in 2023. As a strategic partnership between government, business and finance it has catalysed action across the economy. Under its leadership, industry-led roadmaps representing around 80% of UK territorial emissions have been produced in line with clear, consistent guidelines developed by the Council. The Council has also taken action to tackle issues and address barriers, including supporting the re-launch of the UK Business Climate Hub which provides information and resources to SMEs.

To build retrofit workforce capacity, the government has invested nearly £29m since 2021 to deliver around 34,000 retrofit training opportunities. This includes an £8.85m Home Decarbonisation Skills Training Competition to deliver 8,000 insulation installation and retrofit professional qualifications, and a £5m Heat Training Grant to support 10,000 training opportunities relevant to heat pumps and heat networks up to 2025. The government launched a new Low Carbon Heating Technician apprenticeship in Autumn 2023 and is working with industry to develop occupational standards for insulation and building treatments to create new apprenticeships and T Levels for retrofit work.

The standing charge is matter for Ofgem. Ofgem launched a call for input in November 2023 on standing charges in the non-domestic and domestic retail markets, looking at how they are applied to energy bills and what alternatives could be considered. Ofgem is currently analysing the responses and will publish its response in due course.

On 30 March, my Rt Hon Friend the Secretary of State and I wrote to the Chief Executive of Ofgem, highlighting the importance of keeping charges as low as possible.

Standing charges are a matter for Ofgem as the independent economic regulator. Ofgem recently conducted a call for input looking at how standing charges are applied to energy bills. Ofgem is analysing the submissions it received and will publish its response in due course. www.ofgem.gov.uk/publications/launch-review-standing-charges-energy-bills

The Government recognises that businesses are facing pressure through their energy bills. That is why on 30 March 2024, my Rt hon Friend the Secretary of State and I wrote to Ofgem, highlighting the importance of keeping standing charges as low as possible.

https://twitter.com/ClaireCoutinho/status/1774001008953217079

The standing charge is matter for Ofgem. Ofgem launched a call for input in November 2023 looking at how standing charges are applied to energy bills and what alternatives could be considered. Ofgem is analysing the responses and will publish its response shortly.

Contract negotiations are a matter for businesses and their energy supplier. If a company is concerned about their ability to pay their energy bills, the Government suggests contacting their supplier as soon as possible. It may be possible to negotiate a new contract, including whether a contract without standing charges is available, or to agree a payment plan to help the company to better manage its energy payments.

The Department for Energy Security and Net Zero has inherited or published 35 consultations, for which a response by the department is still outstanding:

• Data sharing regulations for a safeguard energy tariff
• Review of consents for major energy infrastructure projects and Special Protection Areas
• Improving the energy performance of privately rented homes
• Improving home energy performance through lenders
• Introducing a performance-based policy framework in large commercial and industrial buildings
• Non-domestic Private Rented Sector minimum energy efficiency standards: EPC B implementation
• Energy retail: opt-in and testing opt-out switching
• Phasing out the installation of fossil fuel heating systems in businesses and public buildings off the gas grid
• Phasing out the installation of fossil fuel heating in homes off the gas grid
• Review of consents for major energy infrastructure projects and Special Protection Areas, 2022
• Managing radioactive substances and nuclear decommissioning
• Decarbonisation readiness: updates to the 2009 Carbon Capture Readiness requirements
• 33rd Seaward Licensing Round Appropriate Assessment
• Future System Operator: second policy consultation and project update
• Heat networks regulation: consumer protection
• Capacity Market 2023: Phase 2 proposals and 10 year review
• Transmission license exemption for array systems connecting to offshore substations
• Climate Change Agreements: consultation on a new scheme
• Carbon capture and storage (CCS) Network Code: updated Heads of Terms
• Amendments to Electricity Supplier Obligation Regulations to implement power CCUS Dispatchable Power Agreement business model
• Home Energy Model: replacement for the Standard Assessment Procedure (SAP)
• Home Energy Model: Future Homes Standard assessment
• Hydrogen Storage Business Model: market engagement on the first allocation round
• Hydrogen to power: market intervention need and design
• Hydrogen Transport Business Model: market engagement on the first Allocation Round
• UK Emissions Trading Scheme: future markets policy
• UK Emissions Trading Scheme: free allocation review
• Proposals for heat network zoning 2023
• Long duration electricity storage: proposals to enable investment
• Proposed amendments to Contracts for Difference for Allocation Round 7 and future rounds
• Approach to siting new nuclear power stations beyond 2025
• Alternative routes to market for new nuclear projects
• Empowering drivers and boosting competition in the road fuel retail market
• Transitional support mechanism for large-scale biomass electricity generators
• Future ownership of Elexon: licence and code changes

The Department will respond to each in due course.

The Government takes the security of the electricity grid and electric vehicle infrastructure extremely seriously. The Department for Energy Security and Net Zero works closely with Ofgem, the National Cyber Security Centre, and operators to strengthen infrastructure against attacks, share threat intelligence, and set clear and robust regulatory standards that are enforced through the Network and Information Systems Regulations 2018.

The 2021 electric vehicle smart charge point regulations include cyber security requirements. These require that all private charge points meet physical tamperproof requirements, check regularly for security updates, and encrypt all communication to and from the charge point.

The Government has recently published a detailed consultation package, 'Delivering a smart and secure electricity system: implementation'. This sets out proposals for minimum security and grid stability requirements for Energy Smart Appliances and load controlling organisations to further mitigate risk.

Aberdeen has 102 staff (as at end March 24) and our ambition is to increase this to 135 by March 2027, however this is the overall target for this location; targets are not specific to grades or staff groups.

Relocation of roles out of London is being managed via voluntary relocation of internal staff and through recruitment, therefore we are unable to predict grade composition of staff that will be based in Aberdeen in 2027.

Network regulation, including the ability to grant Distribution Network Operator licenses, is a matter for Ofgem as the independent energy regulator. As such, the government does not comment on Ofgem’s decision making on licence applications.

Network regulation, including the ability to grant Distribution Network Operator licenses, is a matter for Ofgem as the independent energy regulator. As such, the government does not comment on Ofgem’s decision making on licence applications.

The Government response to the consultation on amendments to the Boiler Upgrade Scheme sets out the responses received by industry stakeholders, including evidence to support the removal of the legal requirement to have no outstanding recommendations for cavity and loft insulation which was determined a barrier to access the scheme.

As well as supporting UK energy independence, low carbon hydrogen will be critical to helping British industries transition from oil and gas, provide greener energy for power, transport and potentially home heating. Government’s working closely with the oil and gas industry to achieve a managed transition, including through the North Sea Transition Deal. Deal recognises the world-leading skills of the sector and supply chain and key role it could have in helping deliver net zero and Hydrogen production ambition. The Offshore Petroleum Licensing Bill sends a strong signal to support the continued investment necessary to our energy security and transition to cleaner technologies.

The network build proposed in ‘Beyond 2030’ supports the connection of 21GW of offshore wind and other low carbon generation, covering £58 billion estimated investment into the electricity network.

Network expansion will support energy security and decarbonisation goals including connecting renewable energy to the grid, and the electrification of industry, heat and transport. The proposals will accelerate delivery of low-cost, homegrown energy to homes and businesses and reduce curtailment of renewable energy resulting from network constraints.

National Grid ESO estimates the proposals could add £15 billion to the UK economy and support over 20,000 jobs annually.

The Energy Company Obligation (ECO) places a requirement on larger energy suppliers to deliver heating and insulation measures to eligible low-income and fuel poor households. Energy suppliers recoup delivery costs through consumer bills.

Homes benefitting from ECO4 will cut approximately £430 off their energy bills.

The Department does not hold data on the number of households affected by poor standards of workmanship under ECO. Through the ongoing evaluation of ECO4, we are gathering feedback from a sample of households on their satisfaction with installations.

The Energy Company Obligation (ECO) places a requirement on larger energy suppliers to deliver heating and insulation measures to eligible households. Energy suppliers are assumed to recoup the cost of delivery through consumer bills. Homes benefitting from ECO4 are assumed to cut an average of £430 off their annual energy bills based on the latest price cap.

As part of the ongoing evaluation of the current iteration of the Energy Company Obligation, ECO4, we are gathering feedback from a sample of households on their satisfaction with installations. Installation companies must be registered with TrustMark, the UK Government endorsed Quality Scheme for home improvements. TrustMark registered businesses are required to adhere to Publicly Available Specification (PAS) standards, providing a warranty to the householder when a measure is installed in case something goes wrong. Ofgem, the scheme administrator, has a route to redress for consumers should they be dissatisfied with the measures delivered.

The scheme administrator, Ofgem has set out a comprehensive route to redress for any issues arising from measures installed under the scheme, which can be found at: www.ofgem.gov.uk/eco4-complaints-process.

In response to the Competition and Markets Authority (CMA) green heating and insulation review, the government also announced work which is being undertaken to improve consumer protection. A link to the government’s written statement of 21 February 2024 can be found here.

We remain fully committed to protecting all consumers undertaking home retrofit work.

As part of the ongoing evaluation of the current iteration of the Energy Company Obligation scheme, ECO4, we are gathering feedback from a sample of households on their satisfaction with the installation of energy efficiency measures.

Installations of measures under ECO4 are carried out by TrustMark registered businesses and must adhere to the industry-developed Publicly Available Specification (PAS) 2035/2030 standards.

Minsters and Officials have regular meetings with Ofgem to discuss a wide range of issues, including standing charges.

Ofgem recently sought views on standing charges and is currently analysing the responses. Further information is available at https://www.ofgem.gov.uk/publications/standing-charges-call-input .

It is not uncommon in consumer markets for companies to recover costs, such as customer debt, from their wider customer base. Otherwise, it could risk the company being inadequately funded for the services they provide, including help and support to vulnerable customers. Without adequate funding, it could also risk suppliers going insolvent, giving rise to potentially significant additional costs of a supplier of last resort or special administration regime.

In England, estimates indicate that the government support provided prevented 389,000 households from becoming fuel poor in 2023.

Despite unprecedented support with bills, the Government recognises consumer energy debt as a large and growing issue and understands the cost-of-living challenges households are facing.

Ofgem has a responsibility for setting the price cap at which suppliers can recover costs they incur, and the government expects suppliers to do all they can to support customers in debt, particularly vulnerable customers.

We welcome Ofgem’s ‘Affordability and debt in the domestic retail market – call for input' published 11 March 2024 and look forward to seeing the results and Ofgem’s next course of action. Details of Ofgem’s consultation can be found here: https://www.ofgem.gov.uk/publications/affordability-and-debt-domestic-retail-market-call-input

Ofgem, the independent regulator, is responsible for compliance and enforcement of license conditions.

As an Alternative Dispute Resolution scheme, the Energy Ombudsman does not have the enforcement powers of Ofgem does. The Energy Ombudsman can however tell suppliers to take practical action, make an apology, offer financial awards up to £10,000, and make recommendations to prevent an issue from happening again. Energy suppliers are legally bound to implement decisions made by the Ombudsman.

The Department recently consulted on a proposed policy for siting new nuclear power stations after 2025, which set out a criteria based approach. While EN-7 will be the primary basis for development consent decisions on nuclear power stations after 2025, we recognise that the sites listed in EN-6 are likely to retain many inherent advantages. EN-6 will not be withdrawn, and we expect it to remain an important and relevant consideration in any planning decision for projects at any of the sites listed in EN-6.

The Department monitors and is evaluating all aspects of ECO4, including ECO Flex.

The Department publishes information on the number of homes retrofitted for energy efficiency in the last five years through the following government schemes: Energy Company Obligation (ECO), Great British Insulation Scheme (GBIS), Green Homes Grant Vouchers Scheme, Local Authority Delivery, Home Upgrade Grant, and Social Housing Decarbonisation Fund (SHDF).

SHDF retrofits social housing only. A breakdown of the number of homes retrofitted in the social and private sector can be found in the ECO and GBIS statistical releases.

The Government will not raise Minimum Energy Efficiency Standards (MEES) to EPC Band C for privately rented homes, but continues to encourage homeowners to improve the energy performance of their homes where they can.

We are spending £6bn this Parliament on making buildings cleaner and warmer. That is in addition to the £5bn that will be delivered through the Energy Company Obligation (ECO4) and the Great British Insulation Scheme up to March 2026. We have also announced a further £6bn worth of support up to 2028 to help around a million families cut their energy use.

The Department does not yet have final figures for its 2023/24 advertising and marketing expenditure, the first full year since the Department was created. This information will be published in the Department’s annual accounts on GOV.UK.

In November, Ofgem announced a review into standing charges, exploring how it is applied to energy bills and potential alternatives. The review had now closed and Ofgem is currently analysing the input it has received. Ofgem will publish its response in due course.

The variance in standing charge is mainly due to regional differences in energy distribution costs. These costs reflect the expenses of maintaining a live supply in a specific area, and the number of consumers those costs are spread across.

On 30 March, I wrote to Ofgem, highlighting the importance of keeping standing charges as low as possible.

The Boiler Upgrade Scheme opened to applications in May 2022. Up to the end of February 2024, there were 65 grants paid for installations in properties in the constituency of South Holland and the Deepings.

Fuel poverty is devolved.

The UK has a secure and diverse energy system – including through access to our own North Sea gas reserves, the second largest Liquefied Natural Gas port infrastructure in Europe, investment in renewable energy sources and steady pipeline gas imports from reliable partners like Norway.

The annual Statutory Security of Supply Report 2023 (December 2023) concluded that Great Britain is anticipated to maintain adequate supplies of electricity and gas to meet consumers’ demands over the short- and long-term.

Weblink: https://assets.publishing.service.gov.uk/media/6574ae1a33b7f2000db72144/statutory-security-supply-report-2023.pdf