Energy: Action on Bills

Baroness Worthington Excerpts

Monday 2nd December 2013 Lords Chamber

[Baroness Worthington (Lab)]

My Lords, I am grateful to the noble Baroness for repeating the Statement.

I will start by commenting on why we have the Statement, which has all the hallmarks of being rather rushed. Only a month ago, we were debating the Annual Energy Statement. That was intended to be the document in which the Government set out their near-term priorities on energy policy—but here we are, less than a month later, considering a whole raft of new announcements. It is a bit odd, and the timing seems to be related more to trying to air difficult discussions ahead of the Autumn Statement than to anything else.

The rushing of this has serious implications. As noble Lords will be aware, the Statement does not have an impact assessment attached to it. It is subject to consultation—although you would not believe that given what we have read in the newspapers—which will not begin until January. We are in danger of having energy policy being made up on the hoof. The serious implications are that that will destabilise people’s confidence in our market. If we had an impact assessment, we could see what the full implications of this raft of policies would be. That would help us understand the impact on jobs in the insulation sector and the implications for households, including fuel-poor households. How many of them will now miss out on ECO measures as a result of the announcement today? I should be grateful if the noble Baroness could give me an estimate of how many households will now not receive much-needed help to insulate their homes as a result of the carbon-saving proportion of the ECO being cut by one-third.

The other curious aspect of this package is that we are now being told that the Government have managed to get a voluntary commitment to reduce network charges. Why is that voluntary? Do we not have a regulator that is meant to be putting the consumer first and assessing whether distributed network charges are appropriate? It is highly irregular for a department to be ringing round asking for voluntary cuts to a charge that is subject to price regulation. Clearly, our price regulator is not up to the task.

That raises another question about whether any of this will actually be delivered. Is it true that Ofgem has powers that it can use to ensure that the savings that the Government are making for the energy companies will be passed on to the consumer? Given that it seems incapable of regulating the distributed network operators, why should we believe that it will do any differently with this package of measures?

I am grateful that the noble Baroness repeated the acknowledgement that fuel poverty is still a priority. At the moment, the fuel poverty targets have been abolished and we are expecting to see new targets for what the Government propose to do on that policy. When we will see targets being re-established to deal with fuel poverty—not to “address” it but to tackle it and reduce the number of people who fall into that category?

The package also contains a number of measures to try to boost uptake of the Green Deal. I think that that is being wrapped up as an additional boost, but actually it is clear that the Green Deal is failing so abjectly that the Government have been forced to rethink and introduce the very incentives that were suggested and should have been included right from the start, including stamp duty rebates.

There is now a vague commitment that landlords will somehow be able to help people take up energy efficiency measures. Reading the detail, it seems that 15,000 households are expected to be supported by this landlord intervention. Can the Minister tell me what percentage that represents of households in the rented accommodation sector? It does not seem a huge number. Also, what proportion of least-efficient households is that likely to address?

On the issue of landlords and the energy efficiency of their properties, it has come to my attention that the Government were recently forced to pay £6 million of taxpayers’ money to the administrating body that looks after the energy performance certificate policy for rented accommodation because the number of people who have actually complied with the law in providing energy performance certificates is vastly under what was expected. Why is this? Why do we have a situation where landlords are not complying and not providing the energy performance certificates they are mandated to provide for their tenants?

The other question about the 15,000 households is: how will the Government ensure that the target is actually met? Their progress on the Green Deal is, as we know, lamentable. Fewer than 1,000 households have taken it up, against an overall target of 100,000. If the policy is to succeed, how on earth are we going to ensure that it is auditable, measurable and will actually be delivered?

I will make a couple of comments on the carbon implications of this package. The Government have been relatively clear that this will see a 3 million tonne increase in carbon emissions and have sought to introduce policies to mitigate that, one of which is a totally non-specified policy in the transport sector. Can the Minister give us any more information on what that policy is likely to be? The transport sector is not renowned for cheap or affordable carbon saving, so I would be interested to see what the impact assessment will say on the cost of that transport policy compared to the cost of cutting carbon through energy efficiency. We all know that energy efficiency is one of the best ways to reduce carbon. It is one of the most cost-efficient ways forward. Yet here we are, reducing that very policy.

When it comes to value-for-money policies on carbon cutting, will the noble Baroness also comment on the fact that, as we saw in our debate on the Energy Bill, the most cost-effective way of reducing carbon is to switch from coal to gas. In this House we passed an amendment designed to encourage that and to make sure that we do not have coal burning continuing at very high levels on into the next decade. Yet it seems that on Wednesday it seems that the Government will be whipping against it. Will the noble Baroness also comment on that?

In closing, I have a horrible suspicion that the organisation that will be celebrating the most out of this will be EDF Energy, which seems almost word-for-word to dictate government energy policy. I notice from its press release that it is now gunning for the home-display elements of the smart metering rollout. I wonder how long it will be before they are cut. It is also interested in reducing network charging. The thing I find most regrettable in all this is that the Secretary of State in the other place stated that he was standing up to the big six. I am afraid nothing could be further from the truth. This is policy as dictated by the big six. A Labour Government would stand up to the big six, split up the companies so that they are ring-fenced from generation and supply, and introduce far greater competition into the energy market. That is the way to get prices down. Much greater competition in every element of the energy supply chain is the only way that we can get out of the bind we are in at the moment. It is regrettable that the Government do not seem able to do that.