Warm Home Discount (England and Wales) Regulations 2026

Lord Jones Excerpts

Monday 23rd March 2026 Grand Committee

[Baroness McIntosh of Pickering (Con)]

My Lords, I thank the Minister for introducing these regulations, which I broadly support. I declare my interest as the honorary president of National Energy Action, from which I am delighted to have had a written briefing.

I have a question for clarification at the outset. A piece on the Government’s website titled “Help with the cost of living in 2026” talks of

“an average of £150 off the costs of energy bills”.

It goes on to say:

“This support is on top of the Warm Home Discount Scheme—a one-off £150 discount off your electricity bill—a total package of £300”.


Do people have to apply separately for the £150 off the cost of living and for the £150 from the warm home discount scheme? The figure cited in the regulations, by the Minister and on the GOV.UK webpage is £150. From memory, I thought the figure for the warm home discount scheme was £350. If that is the case, £350 to help those most in need because they are suffering the most from fuel poverty will obviously go a lot further than £150. I do not know whether that is an erroneous memory on my part, but that is what I remember.

The NEA is concerned—this is my wording, not the NEA’s—about one potential consequence of the regulations. The idea is to lift 1 million homes out of fuel poverty, setting new standards for landlords to meet to help do so. However, as we saw with a recent Bill, whose name I forget, under which landlords were meant to improve housing, in fact they sold it because they simply did not have the means to upgrade it. Does the Minister share my concern that instead of rented properties being upgraded at the cost of the landlord or, potentially, with the help of the Government, the landlords may not have the means to do so and therefore the rented properties will go off the market? That is a very real concern.

Is any attention being focused on rural areas? My experience, having been in the European Parliament and represented two separate constituencies in the House of Commons, is that homes in rural areas tend to be less well insulated and more isolated. It is more expensive to heat a house than a flat. Is any particular attention being given to rural areas in that regard? That could make a real difference to reducing fuel poverty.

National Energy Action has a good record on giving advice and doing what it calls hand-holding to guide people through the system; I commend it for doing this. I like to think that I am moderately intelligent but, if I have difficulty in understanding the system, I can understand how tenants and others who wish to apply for the scheme may need help. Have the Government considered offering such help to those who are hopeful of benefiting from the warm home discount—and, indeed, from the cost of living reduction?

Are the Government planning to address the vexed issue of standing charges on energy bills? I know that this is a great theme of the energy champion, Martin Lewis. I never manage to watch his programme because we always seem to be voting here when it is on, but in my experience this is the only utility where the customer is paying up front for the infrastructure to be put in place. Normally, with telecoms and broadband, the customer pays for the infrastructure after it is in place.

The point that I would like the Government to consider is this: all of us can, as consumers, control our unit costs by using less power—that is, less electricity and less gas—and reducing our consumption in that way, but we have absolutely no control over the standing charge. When I go on to Uswitch, I see that it is creeping up: it was 40p per day last year but, this year, it is 50p or 60p per day. We have seen that energy bills are projected to come down from April for three months, but, given the backdrop of the Middle East, there is now an expectation that, if not from July then certainly from the next increase in September or October, people will face the very real issue of finding that they cannot control their household bills.

Finally, National Energy Action refers to the debt mountain. A growing number of households are averaging debt balances exceeding £1,200 a year. This is posing real problems for them. They are paying for last year’s electricity use before they have even saved up for next year’s electricity use. In the words of the NEA, many are trapped in a cycle of paying for last winter’s energy alongside current usage, often with no formal repayment arrangement in place. Are the Government looking at the possibility of trying to address this issue?

In conclusion, as I say when I have already used up all my “finally”s, can the Minister use his good offices to ensure that the warm homes plan is embedded not just in his department’s work but in the 10-year health plan, to make sure that this issue is reflected in health—older people can become unwell if they are not able to heat their houses properly—as well as in the new child poverty strategy, to make sure that there is completely joined-up government at this level? Otherwise, I like the regulations.

[Lord Jones (Lab)]

My Lords, it is always instructive to follow the noble Baroness. I thank the Minister for his shrewd analytical introduction and his insight. Tangentially, for me, it conjured up memories of chilblains, hot-water bottles and ice on the inside of the windowpanes—the considerable discomforts of a post-war Britain barely out of the VE Day and VJ Day celebrations. It was an era of greyness, rationing and lengthy bus queues—not to mention the frequent and unannounced power station electricity cuts in our ever-cold homes.

These regulations aim to help some 6 million households, with the best part of £1 billion of state money going to fellow citizens. The Minister might be pleased and these regulations are surely to be welcomed in these most uncertain times. Can he say how many Welsh households are in receipt of such moneys? It is the case that Wales is a place of low wages and unusual weather patterns.

--- Later in debate ---

[Lord Whitehead (Lab)]

I am delighted to tell the noble Baroness that I cannot speak for the Cabinet Office’s website, but I take her point that these things need to be clarified as much as possible.

The noble Baroness also asked about standing charges, both generally and in relation to this particular measure. She will be pleased to know that we have announced our intention to move warm home discount costs from the standing charge to the unit rate; Ofgem has confirmed that this charge will be included in the price cap from 1 April 2026. That will offer a cleaner and more accurate basis of cost recovery while addressing widely raised concerns around standing charges. It does not overcome the overall question of whether standing charges should exist at all. Obviously, that is a wider question for review of standing charges and how they impact on the costs of energy in general.

The noble Baroness, Lady McIntosh, the noble Earl, Lord Russell, and the noble Lord, Lord Moynihan, also mentioned debt. That is an important issue, because each consumer pays around £52 a year towards the cost of managing and writing off debt. If the debt were to become unsustainable, it would place an even higher cost on consumers, so we are working urgently with Ofgem to drive debt out of the energy system alongside delivering reforms that put people first. Ofgem has published an updated debt strategy, setting out its near-term actions and priorities to support suppliers to reduce the level of debt in the sector and subsequently lower the cost of managing this for consumers, lowering that £52 a year that is being paid. That includes proposals for a debt relief scheme to tackle debt built up by some consumers during the energy crisis.

Noble Lords mentioned the disproportionate impact of fuel poverty in rural areas and asked whether any additional measures were being looked at on that. This issue is very pertinent in Wales, as a larger number of people are off-grid and in fuel poverty than in England. I am pleased to inform noble Lords that about 300,000 Welsh households will benefit from this expanded scheme, a substantial increase from previously. As far as rural fuel poverty is concerned, some of the additional measures that can be undertaken by energy firms as part of the overall scheme are relevant to making sure that people who are in fuel poverty and in rural areas, and who have higher costs, are adequately addressed.

Noble Lords also asked about the adequacy of the £150. Certainly, the Government will keep that under close review, but we have taken the view that it is £150 for 2026-27, partly because of the substantial expansion of the scheme, how that indirectly falls on customers as a levy and how that can be sustained. The suggestions put forward this afternoon have certainly been heard and are well received, and we will keep those issues under close review.

I hope I have covered most of noble Lords’ points but, as I said, if I get back to my office and realise that I have completely missed a key point, I will try to make up for it by communicating with the particular noble Lord or noble Baroness at the earliest opportunity.

Tackling fuel poverty is a priority for this Government and the views expressed underline how critical it is that we continue to tackle it.

[Lord Jones (Lab)]

Did I hear the Minister answer the question on paragraph 5.3 of the Explanatory Memorandum about automated data matching and privacy?

[Lord Whitehead (Lab)]

I apologise to the noble Lord. I am afraid I did not address that question directly, but the privacy notice for the warm home discount is published on the GOV.UK website, where it can be easily accessed. That privacy notice is in line with those from other areas of government with regard to the privacy of people whose data is being shared.

--- Later in debate ---

[Lord Jones (Lab)]

Shall there be an answer to the question about paragraph 5.3 of the Explanatory Memorandum? I am not sure I heard my noble friend answer that.

Great British Nuclear: Modular Reactors

Lord Jones Excerpts

Monday 2nd December 2024 Lords Chamber

[Lord Hunt of Kings Heath (Lab)]

My Lords, I think the noble Baroness will know the answer, because 16 months of the lifetime of GBN occurred under her party’s Administration. The fact is that we are working very closely with GBN. It has to go through considered processes. It has done two rounds of assessment and, as I have said, four technologies have been shortlisted, all of which are viable options for development. Crucial talks are now taking place. Companies will be invited to make final bids, and decisions will be made in the spring. I am confident that GBN will ensure that we get to that final decision as soon as possible.

[Lord Jones (Lab)]

My Lords, will my noble friend the Minister please consider how we might give good news to those sites in north-west Wales, principally the Wylfa plant in Ynys Môn—Anglesey—now dormant, and Trawsfynydd in Meirionnydd, now dormant? The communities around those great plants that generated nuclear power for Britain deserve consideration in so far as, throughout north-west Wales, skilled jobs with good wages and status are very rare and both communities have deserved investment from our Government.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I think I get the point my noble friend raises. He is absolutely right: new nuclear can bring many high-quality jobs, enhance our skills chain and help us grow the economy. He mentioned Wylfa in particular, and I well understand. He will know that Great British Nuclear has bought Wylfa, which is one of the sites identified in the planning statement in relation to nuclear. We are looking to make our siting policy more flexible to give us more opportunities in the future. We see new nuclear as having a hugely important role to play in our future energy structure.

Carbon Dioxide Transport and Storage Revenue Support (Directions and Counterparty) Regulations 2024

Lord Jones Excerpts

Monday 13th May 2024 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Energy Security and Net Zero (Lord Callanan) (Con)]

My Lords, I beg to move that these regulations, which were laid before the House on 15 April this year under the affirmative process, be approved. I will also speak to the draft Carbon Capture Revenue Support (Directions, Eligibility and Counterparty) Regulations 2024. To save a considerable amount of time, I will hereafter refer to these regulations as the CO₂ transport and storage regulations and the carbon capture regulations.

These regulations are part of a series of secondary legislation made under powers in the Energy Act 2023, a landmark piece of legislation, which received Royal Assent on 26 October; I am grateful for the support that noble Lords gave me in getting that important legislation through. I will first provide some important background on the UK’s carbon capture landscape before turning to the rationale and the details of the regulations.

Carbon capture, usage and storage, commonly known as CCUS, supports the UK’s legally binding commitment to reduce greenhouse gas emissions to net zero by 2050. In 2021, HyNet and the East Coast Cluster were announced as the UK’s first CCUS clusters, where CO₂ will be captured from a range of sources to support the low-carbon economic transformation of our industrial regions. The CO₂ transport and storage network—the T&S network—is essential for building that CCUS capability, as it is the enabling infrastructure for captured CO₂ to be transported to permanent, offshore storage.

To facilitate the development of T&S infrastructure, the Energy Act 2023 makes provision for revenue support to be available to any eligible transport and storage company, abbreviated to T&SCo. Revenue support is part of the broader T&S regulatory investment model, or TRI model.

Under the TRI model, an allowed revenue will be determined for transport and storage companies, and exposure to revenue gaps, which refer to instances where annual revenue from user charges is less than a T&SCo’s allowed revenue, will be mitigated. For example, where a revenue gap arises beyond a T&S company’s control, such as where a network user is late joining the network, a shortfall in allowed revenue may arise. In those instances, T&S companies can increase charges across the user base up to a cap.

Should the increase in charges across the user base up to the cap be insufficient, we are proposing that T&SCos be entitled to revenue support as a last resort mechanism, funded by the Government, enabling T&SCos to recover shortfalls through a revenue support agreement—hereafter shortened to RSA. Without this, there would remain a significant barrier to investment in T&S infrastructure in the early stages of development of the CCUS sector.

I turn to the detail of the transport and storage regulations. RSAs will be offered as a contract between a T&S company and a counterparty, which will be done under a direction of the Secretary of State in accordance with Section 60 of the Act. To maintain integrity of RSA allocation, the first aspect of these regulations places requirements on the Secretary of State’s directions and sets out circumstances in which a direction ceases to have effect, including where the Secretary of State revokes a direction before a T&S company accepts a contract in writing.

Secondly, the counterparty will be responsible for publishing each RSA contract, as well as for establishing and maintaining a public register of key project information. Ensuring transparency of these contracts is essential for encouraging greater understanding of the level of support for, and confidence in, this critical but nascent sector.

To be clear, the regulations allow sensitive information to be redacted by the Secretary of State, ensuring that any sensitive commercial information—for example, information that constitutes trade secrets—or personal data is removed before documents are made public. The statutory instrument’s final measure will require the counterparty to promptly notify the Secretary of State if it is unable to perform its duties.

Turning to the carbon capture regulations, I will first set out the context of industrial carbon capture, ICC, which is critical to decarbonising industries with hard-to-abate emissions and achieving net zero by 2050. The Government’s ambition is to capture and store 6 megatonnes annually of industrial emissions of CO₂ by 2030, increasing to 9 megatonnes of CO₂ annually by 2035. The ICC business models are designed to incentivise the deployment of carbon capture technology by industrial and waste users who often have no viable alternative to achieve deep decarbonisation.

I turn now to the role of the carbon capture regulations in facilitating the business models. The regulations broadly mirror those that I detailed on transport and storage in respect of the Secretary of State’s directions to a counterparty—in this instance for offering a contract with an eligible carbon capture entity, including where directions cease to have effect or may be revoked. The reporting requirements for a counterparty also remain, including a duty to publish contracts entered into, establish a public register and promptly notify the Secretary of State if the counterparty is, or considers that it is likely to be, unable to carry out its functions.

However, the regulations also satisfy the duty in Section 68(4) of the Act, by determining the meaning of “eligible” in relation to a carbon capture entity, specifically one where the CO₂ to be captured and stored is produced by commercial or industrial activities, as set out in the Act.

In short, the regulations set out who can be eligible for support. The transport and storage regulations do not include a definition of eligibility, as an eligible transport and storage company is defined at Section 60(2) of the Act as a person who holds an economic licence or has been notified in writing by the appropriate parties that an economic licence is to be granted. The ICC business models have been developed to support decarbonisation of the industrial sector, including the waste management sector.

We do not consider it appropriate for the ICC business models to support carbon capture deployment for certain parts of the power sector. Therefore, the regulations set out that an entity would be ineligible if it is capturing CO₂ produced by the generation of electricity and is connected to one or both transmission and distribution systems in respect of all the electricity that the generation station produces.

However, capture from combined heat and power plants and energy recovery generating stations would be eligible, regardless of how and whether they are connected to the transmission and distribution systems. It should be noted that these regulations form only one part of the assessment for whether projects would be awarded an ICC or waste ICC contract. Further eligibility criteria are expected to be set for individual allocation rounds in the appropriate allocation guidance.

In conclusion, in implementing transport and storage infrastructure and the industrial carbon capture business models, these draft regulations represent an essential step towards achieving our 2030 deployment ambitions and, ultimately, net zero. I therefore commend them to the Committee.

[Lord Jones (Lab)]

My Lords, I thank the Minister for his explanatory and informative remarks, for these regulations are complexities for the uninitiated in these deceptively thinly paged dual sets of regulations. Surely, they are regulations to be welcomed. It is the war against CO₂, and the Minister, if I may say so, has escaped the thickets of Brexit legislation to display insightful knowledge of the huge energy world.

Climate change is upon us. We should not be complacent. I hope the regulations will facilitate the successful overcoming of a big challenge. There are certainly ambitious targets. Can the Minister explain a little further the register and the counterparty in Regulation 6(2)? Also, in paragraph 4.2 of the helpful and necessary Explanatory Memorandum we see the power of the Secretary of State to “direct”. It is reasonable for a Back-Bencher in a Parliament to query that word. Here, at first glance, it is the granting of all-powerful influence. Is that so? I think I know the Minister well enough in parliamentary terms to know that he is not a person who seeks all-powerful directions, but he might like to explain with his usual expertise what that is all about. This is, after all, a Parliament.

At paragraph 4.3 of the Explanatory Memorandum, we have references to the nations and, not least, to Wales. How many likely carbon capture projects are mooted or in the pipeline for Wales, Scotland and England, not forgetting Northern Ireland? At paragraph 5.3, what is the department’s understanding of

“a reasonable return on investments”?

Is there a percentage in mind? Shall it not be a blank cheque? Can the Minister also explain further, for the uninitiated, what the “CCUS cluster” is at paragraph 5.5?

At paragraph 6.5, the department rightly points to “large upfront capital expenditure”. Can the Minister give a possible list of the scale of this up front? Surely there are in existence projects quite far down the line. I ask for the Minister to give his best guesstimate. At paragraph 5.9, it is welcome—to be very positive—that the public are to be made aware of deployment of a public register of projects. That has to be good.

Time is of the essence. I am aware that in north-east Wales, Connah’s Quay Power Station proposes carbon capture. This station is in the constituency that for 31 years one represented in another place. One visited regularly. It was once mooted for nuclear power, being on the substantial River Dee estuary. I emphasise that I have no registered interest whatever in raising this matter, but since I still live in the shadow of this establishment and have had a connection with it for the best part of 54 parliamentary years, I raise the matter. Currently the station is owned by a company called Uniper, about which I know very little. The company is briefing in the locality. I quote from the letter of invitation to visit for briefing. It is from a shrewd, practical managerial team that I encountered in response to its invitation.

Briefly, it says that it is

“developing plans for a new low-carbon, highly efficient gas-fired power station with carbon capture technology at the site … We expect to reuse an existing pipeline, which will connect to the regional CO₂ infrastructure currently under development by Eni, enabling the captured CO₂ to then be transported to permanent offshore storage facilities in repurposed depleted offshore gas fields”.

I visited this plant as a result of receiving that invitation for briefing and, on the face of it, the project seems to be very much related to these regulations. That is why I have quoted from that letter.

Civil Nuclear Road Map

Lord Jones Excerpts

Monday 15th January 2024 Lords Chamber

[Lord Callanan (Con)]

The noble Lord makes a number of good points. Clearly, there are some lessons to be learned from the process of Hinkley. We absolutely funded it in the right way, to go back to the point made by my noble friend Lord Howell, because the cost is being borne by EDF—and it is very kind of the French taxpayer to help us out in our nuclear programme. That is one of the reasons why we needed to look at alternative funding mechanisms for the Sizewell project. Of course, there are always lessons that can be learned in the regulatory process, the planning process and so on to try to bring these projects onstream a little sooner.

[Lord Jones (Lab)]

My Lords, the Minister will know of the great contribution made to the generation of nuclear power by the plants of Trawsfynydd, in the magnificent landscape of old Meirionnydd, and Wylfa on Ynys Môn, Môn Mam Cymru, or Anglesey. Can he give any encouragement today to people who wish to see further generation at the Trawsfynydd plant and the renewal of energy production at Wylfa? Does he know that those plants are far-flung in the north-west of Wales, where well-paid and skilled work is very rare? Can he give any encouragement at this stage?

[Lord Callanan (Con)]

I welcome the noble Lord’s comments. We recognise the substantial contributions that many communities in Wales have made over the years towards our nuclear policy in the UK and all the energy that we have received. Part of the consultation is a check on the siting of new nuclear plants, and community support, the existence of existing grid connections and so on will play important roles in future siting policies. The plants that he mentions score very well in that regard.

Decarbonisation

Lord Jones Excerpts

Thursday 13th July 2023 Lords Chamber

[Lord Callanan (Con)]

My noble friend has been steadfast for many years in his support for free trade—a cause that I manifestly agree with. But it is a complicated issue. It looks as though the EU and US are going down the road of carbon adjustment mechanism taxes, but, as I said in my Answer to the noble Baroness, Lady Blackstone, it is a complicated issue. For instance, do we want to incentivise the installation of poorer-quality solar panels that may be constructed with lower carbon intensity, or better-quality solar panels? That is one example of millions that I could give.

[Lord Jones (Lab)]

My Lords, does the Minister acknowledge that, while we need green policies, there is a major problem concerning the British steel industry? Successive Governments have imposed what have been, in effect, green taxes on a great foundation industry. Now, very little of the steel industry remains. For example, does he realise that the great integrated steelworks—the only remaining integrated steelworks in Britain—is hanging on by its fingertips? The ailing steel company Tata calls for more investment. How can he see his Government urgently giving more investment to save Britain’s steel industry? If Britain is to remain a great nation, as she must, she needs the foundation industry of steel. If ever there shall be war, you need steel.

[Lord Callanan (Con)]

I totally understand the point that the noble Lord is making. He highlights the dilemma of carbon-reduction policies in these areas, where we impose carbon taxes and emissions trading systems and schemes, and of course that has an effect on domestic industries that emit a lot of carbon—the so-called carbon leakage problem. We are working closely with the steel industry to try to help it adjust to greener manufacturing methods, and of course it receives free emissions permits.