Warm Homes Plan

Lord Moynihan Excerpts

Tuesday 27th January 2026 Lords Chamber

[Lord Moynihan (Con)]

My Lords, I thank the Minister for responding on the Statement made in another place.

I very much appreciate that this plan has taken longer to finalise than expected, with a year’s delay, but I have to say that we will join those who support a measured and incremental move towards low-carbon home heating systems. If that is the objective, there are many measures in the plan today that are worthy of support, not least, for example, the greater role for home batteries.

Where our concerns lie is with the test against which any transition must be judged; namely, its impact on the capital and operating costs for families—in other words, on household bills. Having read the Statement and the impact assessment, our view is that what should be a welcome and important initiative to save consumers money looks more likely to have the opposite effect, with rising energy bills and taxpayer-funded initiatives, not least through the recently locked-in energy costs well above market rates.

In the impact assessment, there was no reference to the impact on tenants as a result of the requirements placed on landlords. I very much hope the Minister will address whether these costs can or in his view will be passed on to tenants.

Regarding heating systems, 50% of the British public are unlikely to install low-carbon systems, such as heat pumps, due to high installation costs. Even if the warm homes plan takes the proclaimed £200 off bills for the 5 million projected homes over the next four years, which is unlikely given current energy and projected costs, that will still leave 25 million homes without respite, worrying about the installation costs of the new heating systems. How does the Minister intend to reach the other 80% of the country struggling with higher bills?

Does the Minister agree that the central and more enduring problem is the ongoing operational costs of low-carbon heating? Two-thirds of people with heat pumps now find it more expensive to heat their homes than they did with their previous system. Frankly, that is no surprise. The price of electricity per unit currently sits at a multiple of that of gas, yet the Secretary of State’s plan offers no redress for the long-term costs of this policy. Perhaps the Minister can now lay out whether the department has plans to address the high operating costs of heat pumps.

The Secretary of State has also announced the founding of a new quango, the warm homes agency. The Government claim to be offsetting this with the abolition of Salix, but I am sure your Lordships are aware that this is not a like-for-like trade-off. Can the Minister now confirm what his colleague in the other place could not and give an estimate of the cost of both the new arm’s-length body and the net cost of this quango reorganisation?

Another key element of the plan is the move to introduce widespread solar panels in the UK, set out in the Warm Homes Plan as

“Unleashing the rooftop solar revolution”

on page 33. This is timely, given the Prime Minister’s visit to China. The reason this is so important is that well over 80% of PV modules used in the UK have significant Chinese content. The true figure is very likely to be above 90% when we include panels made by Chinese-headquartered manufacturers. As so many non-Chinese brands still rely on Chinese wafers, a panel can be assembled in, say, Vietnam, Malaysia or the EU and still be heavily Chinese in content. That is why estimates based only on the brand’s country of assembly understate the real proportion. Including these brands, most energy analysts treat around 90% of UK PV panels as having Chinese content in their supply chain.

China’s share of the global supply of polysilicon is some 80% to 85%, and the Xinjiang Uyghur Autonomous Region’s share of China’s solar polysilicon has been variously estimated at between 35% and 45% at its peak, all of which implies that 25% to 35% of global solar polysilicon has plausibly been sourced from Xinjiang-based plants. Can the Minister inform the House how Great British Energy can meet its legal obligation to track exactly which polysilicon plant was used for any UK import, whether that plant is in Xinjiang or elsewhere, and whether specific batches are verified as free of Uyghur labour?

The noble Lord, Lord Alton, has spoken in this House and discussed with me this morning his concern that forced labour has been widely documented in the region and that there is a need to shut the door on forced labour components found in Chinese supplies of polysilicon. Does the Minister therefore accept that independent auditors and NGOs still argue that full traceability is patchy due to multisite production in different factories and different time periods, continuously shifting new contracts and new plants coming online, and lack of full transparency at the level of polysilicon origin?

As I have said, the intentions behind the warm homes plan are commendable, and the help with capital costs is welcome, but this must be accompanied by plans for lowering operational costs, coupled with wider reforms to bring down the cost of electricity. Otherwise, this well-intentioned plan will become a passport to higher domestic electricity bills. I look forward to the Minister’s response.

[Earl Russell (LD)]

My Lords, I welcome this Statement. Promised nearly two years ago as a “flagship response” to soaring energy bills and poor home efficiency, it has taken some time. Delays have consequences, particularly for the millions of families living in homes that are cold. They are paying the price.

That said, this plan brings forward welcome innovation and greater policy coherence, particularly through its focus on climate adaption and mitigation. It marks a significant milestone amid a national affordability crisis and an accelerating climate emergency. But if warm homes are one side of the equation, cheap, clean energy and market reforms are, indeed, the other. We need both to succeed.

The commitment to £15 billion of public investment is ambitious and right. Ministers forecast upgrades for 5 million homes and relief from fuel poverty for 1 million families by 2030. These are the benchmarks by which this plan will be judged. Too many families still live in cold and damp homes, causing ill health and rising health costs. Labour is right to call out the “lost decade” under the Conservatives, when investment collapsed and home upgrades fell by 90%. Greater vulnerability followed Russia’s invasion: 85% of our homes were still dependent on fossil fuels, and £40 billion in emergency support was required. This was the cost of the Conservatives’ delay.

Against this backdrop, the plan’s innovative pathway is welcome. Partnerships with British climate tech firms could, if implemented well, build a world-class retrofit industry, but SMEs need support, predictable regulation and open markets to bring products from design to real homes quickly. The proposed retrofit innovation panel and sherpa approval models are positive, if they deliver.

I am concerned about the six-month cliff edge gap between previous schemes winding down and new schemes starting. I ask the Minister for greater clarity, particularly on the use of the £1.5 billion reserve to help fill this gap.

I welcome the focus on climate adaption. Increasing heat will be a slow-motion killer, so homes must be built for cooling as well as warmth. Including air-to-air heat pumps and supporting communal ground source systems is vital. Passive measures are also needed. The plan’s emphasis on consumer-led energy flexibility is encouraging, with an ambition to triple solar by 2030. Integrating solar batteries, EVs and smart meters can turn homes into virtual power grid participants, cutting bills and easing pressures on the grid. However, this “rooftop revolution” will falter without faster grid connections, planning reform and more resources for local authorities.

The transition must create good jobs and uphold ethical standards. I supported the amendment from the noble Lord, Lord Alton, to the Great British Energy Bill on forced labour. Our clean energy revolution must not rest on exploitation. What measures are we undertaking with our EU partners and others to build our solar manufacturing capacity?

Despite the promising direction and other areas of overlap, this plan stands in isolation from Great British Energy and our community energy plans. This is a missed opportunity. We welcome the support for the UK heat pump industry but question whether £19 million will be enough. The dilution of deployment ambition is troubling—well below the 600,000 a year target by 2028. Even with a £7,500 grant, typical households still face a £5,000 shortfall, which will be too costly for many.

I reiterate the Liberal Democrats’ call for free heat pumps and insulation for low-income families. We welcome the innovation financing models but ask for greater details. Can the Minister assure the House that these will be properly regulated and transparent, and will not put people’s homes at risk?

The new rented sector standards, benefiting some 3 million over the next four years, are also welcome, but how will their effectiveness be measured? We welcome the warm homes agency as a single point of leadership. What more can be done to make sure that people are not the victims of energy scams? Can the Minister explain how the plan will be monitored and reviewed, and confirm some level of flexibility?

Too often in the past, insulation was missing or simply done badly. Government must work to restore confidence. It is essential that we do insulation and we do it well. Without insulation, the best technology cannot prevent heat loss.

Finally, I agree with the Opposition: we need energy market reform, and clean energy needs to be affordable. Electricity costs are too high; while they are that high, households will not change from fossil fuels, so we must balance levies and take them off bills.

To conclude, we welcome the ambition and the funding, but ambition must now be met with urgency, coherence and fairness. Ministers must close the funding gap, put insulation back at the heart, reform markets to make clean energy affordable, and back British workers and innovators. If Ministers rise to that challenge, this plan can deliver not just warmer homes but a fairer, cleaner and more secure future for Britain.

Offshore Wind

Lord Moynihan Excerpts

Monday 19th January 2026 Lords Chamber

Let me close by saying that Britain faces a choice over the coming years. We can seize the opportunities of clean, homegrown energy to cut bills and create jobs, or we can double down on our exposure to fossil fuels. In calling for us to cancel this auction, our opponents made their choice: they are setting their face against cheaper, clean, homegrown power; against 7,000 jobs supported today and thousands more to come; against taking back control of our energy sovereignty; and against action on the climate crisis to protect our children and grandchildren. This Government have made our choice: we choose energy security, lower bills, good jobs, and the climate. I commend this Statement to the House”.

[Lord Moynihan (Con)]

My Lords, I declare my interests. I am chair of Amey UK Ltd, Acteon and Buckthorn Partners LLP. As this is the first time that I have spoken to a Statement on an energy debate from the Front Bench since I was Minister for Energy, I inform the House that I have spent my working life in the energy sector. I was also Minister for Energy in the Margaret Thatcher and John Major Governments and aimed to maximise a low-cost oil and gas province in the UKCS, always emphasising production with the highest importance attached to the environmental impact of all offshore activity, while in 1990 simultaneously launching the non-fossil fuel obligation, the renewable support framework and establishing the UK renewable energy advisory group. I place that on record because that political experience informs the contributions that I intend to make and the questions that I will be asking.

It is axiomatic that we should judge the Statement against the principles of creating greater energy security; increased affordability to all consumers, both industrial and domestic; strengthening the base of low-cost, firm power in the grid; and moving towards cleaner energy. Every decision we take should be addressed against fuel poverty. How can this be so when the order promises the highest prices for intermittent offshore wind in over a decade? How can it be affordable to the UK industry when this order is still more expensive than the £80 per megawatt for gas—which goes down to £55 if you deduct the government-imposed carbon taxes? How can it be when the overall price of contract extension is 24% higher than last year? Why are the Government using the levelised cost of energy matrix when we should be using the only true cost comparator, a full systems cost? As it is intermittent power, do the Government acknowledge that we need more firm gas power plants anyway? Is it not the case that the Government told NESO that there need to be 40 gigawatts of backup generating capacity?

Let us look at what is happening this evening. At a time when the wind is hardly blowing, is it not the case that we are here, this evening, generating nearly 60% of our power from firm gas and only 18% throughout the whole of the United Kingdom from intermittent wind? Worse still, is it not the case that we are importing gas from an increasingly unstable global economy and burning more CO₂ through imported LNG than we would if we developed our own resources to the full, while this minute continuing to burn biomass in Drax, which is more polluting than coal and comes, at this point in time, to only 50% of the total wind generation throughout the whole of the United Kingdom?

Does the Minister agree with Prime Minister Støre of Norway who, at the same time as the Secretary of State was making this announcement, faced the country and stated that he regarded Norway as facing many similar choices to us in the North Sea? He said:

“gas … is crucially important for Norway, and should be developed, not phased out”.

He also said:

“The oil and gas industry is crucial for Norwegian jobs and our welfare state. At the same time, Norwegian gas has never before been as important for European energy security as after Russia’s full-scale invasion of Ukraine”.


Does the Minister agree with him?

Does the Minister agree with Jensen Huang, the CEO of Nvidia, who came to these shores in September 2025 and stated on a visit that the UK will need to utilise natural gas-fired power alongside renewable energy to meet the massive energy demands of new artificial intelligence data centres? For without that strategy, we will have no chance of generating thousands of jobs with competitive new data centres.

We need to keep our eyes open to the economics of energy and to the wider UK economic and political consequences of this Statement and the Government’s energy policy. Does the Minister agree it reduces energy security by increasing the need to buy more foreign LNG to meet the need for firm power; that it increases unemployment through higher energy costs; and that it accelerates the Government’s deindustrialisation of the chemical and petrochemical industries, which was all over the news this weekend, by pricing them out of the market? It drives a coach and horses through affordability for households and industries alike, and it takes us in the direction of significantly increasing the cost of energy when the rest of the world is managing to reduce costs in a highly competitive global market.

Yet, in this order, are we not faced with record subsidy contracts for offshore wind? Is there not a rise in the annual budget for fixed-bottom offshore contracts from the £900 million when the terms were first announced in October—only three months ago—to £1.8 billion last week?

Is the consequence not a poorer UK economy and a loss of jobs from the once prosperous Aberdeen now facing the chill winds of offshore recession? Is it true these are massive wins to the Germans who totally dominated the round and won the lion’s share of the contracts?

I conclude by asking the Minister whether he agrees with the analysis in the FT of the article which covered this round. One reader wrote:

“We have … just about the highest electricity prices in the world despite access to relatively low cost North Sea gas…We have loads of gas boilers…so ongoing gas grid upgrades are required irrespective of…investment in extremely expensive renewables”.


Do the Government agree with Sir Dieter Helm that current UK electricity prices are high because the true system costs of integrating intermittent renewables—wind and solar—plus grid upgrades and back-up are not fully priced in? Does the Minister agree that we all want clean, low-cost renewable energy, and we all want, and can have, domestic gas production which has far lower impact on the environment than imported LNG or high-cost CO₂ emissions from Drax? Why can we not strive to deliver a policy built on these three pillars? I look forward to the Minister’s reply.

High Temperature Gas-Cooled Reactors

Lord Moynihan Excerpts

Monday 19th January 2026 Lords Chamber

[Lord Vallance of Balham (Lab)]

The point raised about the heat production of HTGRs is very important. This is not just about the electricity; it is about the heat and what can be done with it. It is why we are keen to encourage advanced modular reactors in the UK. There is also an opportunity to make them much smaller and to site them in different places, which will free up the link directly to industrial purposes. The advanced nuclear framework lays this out very clearly and encourages the private sector and others to join in putting forward new technologies.

[Lord Moynihan (Con)]

My Lords, given that the Minister has mentioned new technologies, is he aware that the Japanese high-temperature gas-cooled reactors operating at 950 degrees—he mentioned the importance of heat—produce hydrogen at scale and at reasonable cost? Would it not be beneficial to co-operate further with the Japan Atomic Energy Agency on multi-purpose nuclear heat applications, especially hydrogen production, using its high-temperature engineering test reactor, since the low-cost production of energy should be our overall policy objective?

[Lord Vallance of Balham (Lab)]

We have had two collaborations with the Japanese over the last couple of years, one on HTGRs and one on coated fuels, and we have an ongoing one on robotics. The point made about heat production is crucial. The Japanese, through our collaboration with them through UKNNL, have the demonstrator HTGR ready to go in 2028, specifically focused on hydrogen. We will keep in close contact with them over that, because that production of green hydrogen through nuclear is a very interesting opportunity.

COP Climate Negotiations: Cities

Lord Moynihan Excerpts

Wednesday 14th January 2026 Lords Chamber

[Lord Spellar (Lab)]

My Lords, will there not be greater support for these measures from the citizens of those cities and towns in the UK if they can see the benefit coming through to them in their work? What steps are the Government, and those towns and cities when they are commissioning work, taking to ensure that, whenever possible, the work is sourced from the United Kingdom, unlike so many cities that are, for example, buying buses from China with all the other attendant issues?

[Lord Moynihan (Con)]

My Lords—

[Noble Lords]

Oh!

--- Later in debate ---

[Lord Moynihan (Con)]

My Lords, I declare my interests as non-executive chair of Amey and Acteon. In returning to the Front Bench, I pay respect to the Minister’s outstanding parliamentary contribution and extensive knowledge of energy and net-zero policies. I have no hesitation in asking him whether he agrees with the Prime Minister’s warning at COP 30 that the “consensus is gone” on fighting climate change? Does the Minister agree that it is now time to pause to reflect that last week, on the bitterly cold day of 5 January when the UK generated 47 gigawatts of electricity, over 52% had to come from gas because the wind was not blowing, and that fully developing our own offshore natural gas reserves, akin to the strategy adopted in Norway, would not only increase our energy security but be environmentally preferable and cheaper for the people living in British cities than relying heavily on imported LNG from the Middle East and the US?

[Lord Whitehead (Lab)]

I warmly welcome the noble Lord to his place as the opposition spokesperson as far as DESNZ is concerned. He has had a distinguished career in energy, being a former Energy Minister himself, and a distinguished business career in renewables. I look forward to having a very fruitful and constructive dialogue with him over the next period, as the energy discussions move forward.

As far as his question is concerned, I say gently that last year had the highest-ever number of days that were powered completely by renewable energy—more than 80 days—so his concern about particular days being powered by mainly non-renewable power should be set against that overall trajectory, which will continue, particularly with the results of AR7 that have just come out today.