Stephen Kerr

The Renewable Heat Incentive (RHI) compares favourably to other ways of saving carbon or generating renewable energy across the economy, contributes to our renewable targets, and plays a significant role in supporting supply chains in the renewable heating industry.

The Department for Business, Energy and Industrial Strategy (BEIS), and prior to BEIS, the Department for Energy and Climate Change (DECC) has made regular assessments of value for money in the RHI subsidy mechanism. The latest scheme Impact Assessment was made in February 2018 and is available on GOV.UK.

The RHI was reformed in 2017 and 2018 to focus on long-term decarbonisation, improve consumer protection, support supply chain growth and improve value for money for the taxpayer. These reforms included setting maximum heat demand limits for biomass, air source and ground source heat pumps in the Domestic RHI, removing wood drying as an eligible heat use for the Non-domestic scheme and giving Ofgem greater enforcement powers.

In the Clean Air Strategy, the Government committed to consult on removing Renewable Heat Incentive Scheme support for new biomass installations in urban areas which are on the gas grid. The Government published the consultation Renewable Heat Incentive: Biomass Combustion in Urban Areas, seeking views on a number of proposals including the removal of RHI support for some or all or some new biomass boilers in urban areas, imposing geographical restrictions on biogas combustion and introducing regular maintenance checks on existing biomass boilers under the RHI. We will be publishing a government response to this consultation shortly.

Biomass plants in receipt of subsidies must comply with the UK’s sustainability criteria. Plants with a capacity of 1 megawatt and above must also prepare an annual sustainability report, compiled by a third-party auditor, which will provide assurance that the biomass is from sustainable sources.

Wood is a globally trade commodity. Prices are influenced by global demand, currency exchange rates and weather conditions. Our Wood Fuel Disclosure Survey concluded that most of the wood fuel used for electricity generation in the UK is imported and that the volumes of UK wood used are expected to remain constant.

Energy markets have grown in recent years and this has benefited woodland owners and contractors who have increased harvesting rates. Availability forecasts suggest there is potential to increase production further if businesses are willing to invest in the supply chain and encourage more woodland owners to enter the market.

In December 2018 we published in ‘Heat networks: Developing a market framework’ our estimate of the fuel sources that will be used in projects that will come forward under the Heat Network Investment Project. The assumed technology mix is displayed in the figure below. The estimate is based on analysis of HNIP pilot data and surveys of the project pipeline. The estimate is dynamic as it is assumed original CHP plants are replaced with lower-carbon systems at the end of their operational life.

The estimated technology mix is 22% gas back-up boiler, 33% gas CHP, 20% EfW incinerator, 5% biomass, 10% heat pump and 10% waste heat recovery.

The Government launched the scheme as part of the Good Work Plan in response to concerns that rates of employment tribunal payments are unacceptably low. Employers who have failed to pay a tribunal award of £200 or more at least 84 days after the original judgment will be eligible for naming.

The scheme was launched on 18 December 2018 and the Government will publish the first list of employers in due course. Therefore, it is too early to have assessed the effectiveness of the scheme.

It is right that people get what they are owed, and we know employment tribunal awards are not always paid promptly. Government commissioned research in 2013 found that only 53% of successful claimants received full or part payment without enforcement action. 35% had not received any payment at all.

Following this research Government introduced the BEIS penalty scheme in 2016 and have since recovered over £1.5 million to workers of previously unpaid awards. We will now also name employers who do not pay employment tribunal awards within a reasonable period.

We have also recently commissioned research on employment tribunals that will include payment rate information for employment tribunal awards, Acas conciliated and private settlements.

The basis on which levels of support provided to biomass technologies is calculated varies according to each scheme.

(a) Legislation[1] requires a series of factors to be taken into account when setting Renewables Obligation (RO) support levels, including the generation costs and revenues for each technology; the desirability of securing long-term growth and industry viability as well as costs to consumers and impacts on the market for Renewable Obligation Certificates. The most recent comprehensive review of RO support levels was completed in 2012[2].

(b) Strike prices awarded to successful projects in Contracts for Difference (CfD) allocation rounds are determined through a competitive bidding process[3]. Strike prices for biomass projects that were awarded contracts under the Financial Investment Decision Enabling for Renewables programme, an early form of CfDs, were set out in the Electricity Market Reform Delivery Plan and Annex B: Strike Price Methodology [4].

(c) In the last review of Feed-in Tariff levels for Anaerobic Digestion projects undertaken in 2016[5], a return on investment of 9.1% was assumed.

(d) Renewable Heat Incentive (RHI) tariffs are set to compensate generators for the added cost of renewable heating, over and above what would have been paid otherwise. For a given installation, the lifetime cost of the renewable technology and the alternative system (e.g. oil boiler) are considered. The RHI tariff is then set using an economic model so that the rate of return targeted for the applicant population is achieved over the full lifetime of the heating system.

[1] Section 32D(4) of the Electricity Act 1989, as amended by the Energy Act 2008.

[2] Renewables Obligation consultation at: https://www.gov.uk/government/consultations/renewables-obligation-banding-review

[3] https://www.gov.uk/government/publications/contracts-for-difference/contract-for-difference

[4] Electricity Market Reform Delivery Plan and Strike Price Methodology Annex: https://www.gov.uk/government/publications/electricity-market-reform-delivery-plan

[5] https://www.gov.uk/government/consultations/review-of-support-for-anaerobic-digestion-and-micro-combined-heat-and-power-under-the-feed-in-tariffs-scheme

The number of individual installations in receipt of biomass support payments in each of the last five financial years is shown in the table. The table includes data for technologies supported by these schemes which generate electricity, heat or Combined Heat and Power from biomass, which is material derived directly or indirectly from plant or animal matter, fungi, algae or bacteria, including wastes and residues of biological origin. The biomass technologies eligible for support under each scheme are set out in the relevant legislation and guidance.

[1] The Renewables Obligation figures are based on Ofgem’s certificate report as at 23/08/2018 from their Renewables and CHP Register.

The estimated cost of support to renewable technologies burning wood for fuel under three of the schemes in each of the last financial years is shown in the table to the nearest million pounds (in nominal prices). Wood burning is not supported by any technology eligible for support under the Feed-in Tariff scheme.

For the Renewables Obligation, information is not available on the value of support specifically for renewable technologies burning wood. Therefore, the figures provided are the support for technologies capable of burning wood, but other biomass fuels may have been used. The figures for the Contracts for Difference reflect total payments, including to biomass projects, made during the first two financial years of the scheme’s operation and reported by the Low Carbon Contracts Company, the scheme administrator, in its annual reports. Payments by technology type are not reported separately. Wood fuel burning is subsidised under the Domestic RHI biomass tariff and the Non-domestic tariffs for biomass and solid biomass CHP. This assumes all fuel for CHP is wood, as it is not possible to disaggregate wood fuel for CHP. Other types of solid biomass fuel are also eligible for RHI CHP support.

[1] The Renewables Obligation figures are based on Ofgem’s certificate report as at 23/08/2018 from their Renewables and CHP Register.

[2] The actual spend may be different, due to delayed submission of meter readings.

The Government recognises that not being able to recharge at home can dissuade drivers form making the switch to electric. Government’s Electric Vehicle Homecharge Scheme supports eligible electric vehicle owners with up to £500 towards the costs of installing a chargepoint in domestic properties, including in blocks of flats.

In addition, as announced in November 2017 in the Industrial Strategy, Building Regulations will be amended to ensure that cabling infrastructure is provided for chargepoints when new dwellings are built, to help future-proof new homes and avoid retrofitting costs.

For those without off-street parking facilities, Government’s On-street Residential Chargepoint Scheme also provides grant funding for local authorities towards the cost of installing on-street residential chargepoints for plug-in electric vehicles.

Under licence conditions, energy suppliers must inform their customers prior to the installation of a smart meter that they may lose meter functionality when switching. In addition, before any switch is concluded, the new supplier must tell the consumer about any change in how their meter will operate and the service they will receive.

These requirements aim to help consumers make informed decisions about switching, in the period before first generation smart meters are enrolled into the national data and communications platform and thus can be operated by any energy supplier. This upgrade will be done remotely.

Second generation meters use the smart metering infrastructure run by the Data and Communications Company and will enable all consumers to retain their smart functionality when they switch supplier.

During the course of the Review of Modern Working Practices, the panel held events across the UK including in Wales and Northern Ireland. Unfortunately due to the General Election in 2017, the scheduled event for Scotland was cancelled. Officials in the Department speak regularly to their counterparts in the Devolved Administrations and we look forward to engaging with them through the further work set out in the Government response to the Review of Modern Working Practices.

As part of our ambitious Industrial Strategy, BEIS will provide up to £13m to fund "Be the Business", a charity set up by the Productivity Leadership Group to help firms become more productive. Be the Business is currently in set-up phase. BEIS officials will arrange to meet with their Scottish Government counterparts and Be the Business to discuss how its privately and publicly funded activities can benefit Scottish business, within devolved arrangements.

Under licence conditions, energy suppliers must inform their customers prior to the installation of a smart meter that they may lose meter functionality when switching. In addition, before any switch is concluded, the new supplier must tell the consumer about any change in how their meter will operate and the service they will receive.

These requirements aim to help consumers make informed decisions about switching, in the period before first generation smart meters are enrolled into the national data and communications platform and thus can be operated by any energy supplier.

Second generation meters use the smart metering infrastructure run by the Data and Communications Company and will enable all consumers to retain their smart functionality when they switch supplier.

We want the UK to be the best place to start and grow a digital business. As announced in the government's Industrial Strategy, the new Business Basics Programme will trial innovative approaches to drive up the adoption of tried and tested technologies and business practices that can improve businesses’ productivity. The programme will test and encourage SMEs to adopt technologies and practices such as new accountancy software or performance management systems.

In addition, more than four million free digital skills training opportunities will be created as part of a Digital Strategy to make Britain the best place in the world to start and grow a digital business and ensure our digital economy works for everyone.

In addition, the Digital Skills Partnership (DSP) will see Government, business, charities and voluntary organisations coming together to make sure people have the right skills for the jobs in their area and are aware of all the digital training opportunities on offer.

The DSP will also build upon the 4 million pledges of free digital skills training opportunities that our corporate partners pledged as part of the Digital Strategy, published in March 2017. More than 2 million of these pledges have already been delivered; DCMS will continue to work with DSP members to develop new opportunities, direct training to areas where need has been identified, and to encourage the sharing and scaling up of best practice in digital skills provision.

The strategy includes new commitments, including a plan by Lloyds Banking Group to give face-to-face digital skills training to 2.5 million individuals, charities and small and medium businesses by 2020.

The Department for Business, Energy and Industrial Strategy and the Department for International Trade have actively supported the Global Vehicle Trust (GVT) in seeking investors and manufacturing partners. This support included helping arrange for the OX to be displayed at the Low Carbon Vehicle show at Millbrook, Bedfordshire in 2016, and introducing GVT to potential international partners at the show; and discussions in 2017 between our Post in India and potential local partners.

We are unable to provide statistics on smart meter installations broken down by region and nation.

Collectively across both large and small suppliers, around 7.36 million smart meters (SMETS1) have been installed in domestic properties in Great Britain to the end of June 2017.

It should be noted that large supplier statistics are collected at the end of each calendar quarter and small supplier statistics are collected annually, at the end of the calendar year. Therefore installations carried out by small suppliers since 31 December 2016 are not reflected in the above figure. The rollout is also across Great Britain only.

We are unable to provide statistics on how many consumers with SMETS1 meters have switched energy suppliers since the programme began.

According to Ofgem’s report, ‘Consumer engagement in the energy market 2017’, 23% of consumers who say they have a smart meter have switched supplier in the past 12 months, compared to 17% of those who say they do not have a smart meter.

The Government is working hard to support businesses and entrepreneurs across the UK to ensure they can access the finance and wider support to grow and have the right conditions for companies to invest long-term. The Department for Business, Energy and Industrial Strategy publicises these services in a range of ways, including online channels, information delivered by local partners; and regular engagements with businesses, entrepreneurs, representative bodies and others.

Ministers in the Department for Business, Energy and Industrial Strategy regularly discuss matters of mutual interest with their counterparts in the devolved administrations.

The most recent meetings took place on 7 September 2017 when my right hon. Friend the Secretary of State for Business, Energy and Industrial Strategy and my hon. Friend the Minister for Climate Change and Industry met with both Ken Skates AM, Cabinet Secretary for Economy and Infrastructure in the Welsh Government and with Paul Wheelhouse MSP, Minister for Business, Innovation and Energy in the Scottish Government. There are currently no Northern Ireland Executive Ministers.

BEIS Ministers and officials regularly meet energy supply companies to discuss a wide range of issues. We are working with Ofgem to make switching supplier quicker and easier for consumers.

As set out in my responses to PQ 411 and PQ 2586 the UK and Scottish Governments have been in discussion at both ministerial and official levels.

Business support in Scotland is largely devolved however, the department engages with all the devolved regions on a number of initiatives aimed at supporting small businesses. Government programmes, backed by the British Business Bank (BBB), the Enterprise Finance Guarantee Scheme (EFGS) and Innovate UK are investing over £700m to support around 4,500 Scottish companies including: -

• BBB programmes are currently facilitating approximately £405m of finance in Scotland.
• Over 2,600 loans totalling over £15m via the Start-Up Loans programme. The Enterprise Finance Guarantee scheme is currently facilitating over £61m of finance to 700 businesses in Scotland.
• The Investment Programme is currently facilitating over £214m of finance to over 1,000 businesses.
• Innovate UK is committed to support some 206 innovation projects and to invest £28.8m.

The objective of Government’s Industrial Strategy is to increase productivity and drive growth across the United Kingdom. We have provided a framework to build on the strengths of different places and address the factors that hold others back. This will include investing in key infrastructure projects, increasing skill levels, and backing local innovation strengths.

The Industrial Strategy will build on the £12 billion Local Growth Fund (2015-16 to 2020-21) for local areas; 8 Devolution Deals; and 48 Enterprise Zones that will unlock £2.7 billion of private sector investment. We have also agreed ambitious city deals in Scotland and Wales and we will work towards further such deals across the Devolved Administrations.

I refer the hon Member to the answer I gave him to Question UIN 411 on 29th June 2017.

We have announced the first six challenges of the Industrial Strategy Challenge Fund (ISCF) that will bring together the world leading research from across the UK with business to meet major industrial and societal challenges. The ISCF is a UK wide fund so its competitions for funding, and the programmes it will deliver, will be open to businesses and researchers across the UK.

This Government is committed to building an Industrial Strategy that works for all of the UK, to drive growth and prosperity across the country.

In the green paper my Rt Hon Friend the Secretary of State for Business, Energy and Industrial Strategy issued an invitation to Ministers in the Devolved Administrations to take part in Ministerial forums to address productivity barriers and to ensure that economic plans and strategies closely align to benefit citizens in the devolved nations. The first of these forums with the Scottish Government took place on the 11^th April and has been supported by a series of ongoing discussions at official level.

Small businesses play a central role in driving economic growth across the UK and this Government is committed to supporting their continued success.

The industrial strategy will build on this to make the most of the diverse strengths of all of Britain’s cities and regions including Scotland, and grasp the opportunities that could drive faster growth in each of them.

Glasgow, Aberdeen and Inverness City Deals have seen £702m of additional funding from the UK government flow into Scotland. Projects and programmes agreed are helping businesses by: establishing new incubation and innovation hubs; improving local infrastructure; extending and improving the quality of broadband; and tackling key barriers to growth in certain sectors.

Moving forward we are committed to working with the Scottish Government and local communities to agree further deals with: Edinburgh and South East Scotland; Stirling and Clackmannanshire; Tay Cities; and Borderlands.

The table below lists the most recent meetings between Ministers from DCMS and their counterparts in the devolved administrations and the next planned meetings:

We do not hold these figures. For one provider quarterly data on the average length of time for commercial and residential properties to be connected to Openreach’s network is publicly available from their website at https://www.homeandwork.openreach.co.uk/OurResponsibilities/our-performance.aspx.

DCMS has sponsored many programs that have helped support and grow the UK digital skills base. Some of them include the following:

• Through grant funding, we have supported Ada, the National College for Digital Skills to build and pilot an innovative, online platform that will teach coding skills using elements of peer-to-peer and gamified learning. The first school-age students started using the platform in June 2017 in a pilot that was rolled out to 30 schools across the UK. Over 1,000 students – more than double the initial target of 500 – benefited from this learning

  
  

• DCMS is leading on a new digital skills partnership programme which will convene stakeholders across the public, private and charity sector to tackle the digital skills gap in a co-ordinated and coherent way. The DSP will also deliver on the 4 million training places announced in the Digital Strategy

  
  

• DCMS is also leading on a number of short and long-term government interventions to address the cyber security skills gap, funded through the National Cyber Security Programme including a programme targeted at 14-18 year olds and a range of activity in further and higher education.

Ministers regularly discuss a wide range of issues with BT and Openreach.

The use of utility infrastructure to deploy telecommunications fibre has been made easier by the Communications (Access to Infrastructure) Regulations 2016, which transposed the EU Broadband Cost Reduction Directive to UK law. This ensures that digital communications providers can access other providers’ physical infrastructure, across a range of sectors, on fair and reasonable terms.

Ministers regularly discuss a wide range of issues with BT and Openreach.

Openreach has introduced an online mapping tool, which provides other telecoms providers with the locations of its poles and underground ducts, although the tool was introduced in the context of PIA (its duct and pole access remedy).

DCMS has worked with a number of local communities to progress community broadband schemes and, as a result, information and guidance for communities has been developed and published on the Department’s website: https://www.gov.uk/government/publications/community-led-broadband-schemes. This also includes case studies such as Broadband for the Rural North (B4RN) (https://b4rn.org.uk/) and other examples.

My department has regular meetings with mobile network operators at both ministerial and official level to discuss a range of issues, including improving mobile coverage in rural areas across the UK including Scotland. Furthermore, as a result of the Government's landmark agreement with mobile operators each mobile operator will deliver mobile coverage to 90% of the UK's landmass by the end of this year. Additionally O2 will deliver indoor 4G coverage to 95% of premises in Scotland, also by the end of 2017.

The Secretary of State does not have any statutory powers to intervene in the removal of Channel 4 HD from the Freesat satellite television network. The High Definition version of Channel 4 is not a public service channel. Therefore, Channel 4 Corporation may provide Channel 4 HD to platforms on a commercial basis.