Offshore Wind
Tracy Gilbert Excerpts(2 weeks, 3 days ago)
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Ed Miliband
We will certainly not be doing that. We want as much as possible of this to be built in Britain.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
I strongly welcome my right hon. Friend’s statement. The port of Leith in my constituency is well placed to support logistics and manufacturing for Berwick Bank, which has been successful today. Will my right hon. Friend meet me to discuss ensuring that every job possible is secured as a result of this investment?
Factored Energy Arrangements: Pricing
Tracy Gilbert Excerpts(2 weeks, 3 days ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Martin McCluskey)
It is a pleasure to serve under your chairmanship, Mr Stuart. I congratulate the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter) on securing this debate and giving Members across the House a rare and, I am sure, welcome opportunity to discuss factoring arrangements in Scotland.
The Government recognise that households in factored buildings and their equivalents face more complexity in securing the energy they need than typical households. I hope to address the six points that the hon. Member made at the end of his speech, but if there are any that he would like to discuss further with me, I will be more than happy to do so after the debate.
Factors and other property managers have an important role to play in ensuring that they secure the best-value energy contract for their building. When looking to renew their energy contracts, they should be actively comparing quotes across the non-domestic market and considering available customer service data such as Citizens Advice’s energy supplier performance league table.
Small tenements have different needs for communal area pricing from those of a large council complex, for example. Although the existing approach has generally benefited households and offered protection from unfair reselling, some households can be exposed to high prices, as we have heard from the hon. Member and others. The Government are committed to ensuring that our approach to these issues delivers the best outcomes for our citizens as our energy system evolves.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
I welcome this debate and congratulate the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter) on securing it. I am grateful that the Minister recently took the time to visit my constituency and meet residents who had been battling with their factors. They manage a heat network but are all too often left without heat and hot water, which happened again over the Christmas period. My constituents were very grateful to hear the pace at which the Minister is working to put in place regulations and projects that will protect residents like them. Does he agree that we need to see action from the Scottish Government to redress the balance of power between factors, companies and residents?
Martin McCluskey
I thank my hon. Friend for all her work to advocate on behalf of her constituents—I think it was at Saltire Square in Granton, and my hon. Friend the Member for Edinburgh East and Musselburgh (Chris Murray) is doing the same with a heat network in Greendykes. At that meeting, we heard how important it is that we get on top of this. The Ofgem regulation kicks in on 27 January, and we will be looking to Ofgem to implement it as quickly as possible. I agree with my hon. Friend the Member for Edinburgh North and Leith (Tracy Gilbert) that there are more actions that other Governments across the UK can take in this space. I will turn to that point in a moment.
As I say, the Government are committed to ensuring that our approach to these issues delivers the best outcomes for our citizens as our energy system evolves. Ofgem keeps all the standard licence conditions under review to make sure that they are working in the best interests of consumers. As part of that, Ofgem will look again at standard licence condition 6 to ensure that the definitions continue to meet the needs of consumers and the evolving energy market.
Before I turn in detail to other energy policy issues, let me briefly say something about factoring as a whole. It is a devolved responsibility, and it is for the Scottish Government to make decisions relating to it. However, there is widespread interest in factoring reform in Scotland, and there is clearly an interaction between the effectiveness of the factor and our ability to provide the best deal in energy, and many other areas, for the consumer.
There is clearly a need, and there are widespread calls, for factoring reform in Scotland. There have been no major reforms to factoring since 2011, when my hon. Friend the Member for Glasgow West (Patricia Ferguson), in her time as a Member of the Scottish Parliament, took a Member’s Bill through Holyrood. The Scottish Government have recently rejected amendments to housing legislation that would have increased transparency in charging and made it far easier for homeowners to take action against factors. I believe that further work in the area would be welcomed by many across this Chamber and by tenants and homeowners in Scotland.
As we have heard from the hon. Member for Moray West, Nairn and Strathspey, when residents do not have direct control over their energy supply, access to the Energy Ombudsman depends on the specific arrangements between them and the intermediary contracting with the supplier. If residents do not have control over the party that contracts with the supplier, allowing them access to the ombudsman fundamentally changes the role and purpose of the Energy Ombudsman as a service between the supplier and the contracted customer. Ofgem is always happy to clarify where consumers are currently able to access the ombudsman, to make sure that customers are not missing out on any avenues of redress to which they are entitled, but I am happy to take away the hon. Member’s point and raise it when I next meet the Energy Ombudsman in person.
Meter profile classes, which the hon. Member also raised, are the responsibility of Elexon. Ofgem has previously clarified that, for communal supply arrangements, profile classes should not be the final determining factor in the supply type offered by suppliers. If further clarification is needed in that area, it can be explored by Ofgem and Elexon. I encourage the hon. Member to write to both of them on that point.
We are aware that not having direct control over all aspects of the supply can create difficulties for households. Where households do not have direct control over their individual supply arrangements, Ofgem’s maximum resale price rules protect them from being overcharged by limiting the price of energy charged to consumers to the price paid by those procuring the energy. The principle is that profit should not be made when reselling energy in those kinds of arrangements. The Government are very clear that resellers such as factors or landlords should not profit from the resale of energy. The maximum resale price is set at cost pass-through, meaning that the maximum price at which energy can be resold is the same as the price that the reseller paid. Many who are resold energy have limited choice over who supplies them. The maximum resale price is important, as it is the main protection against resellers exploiting their position.
The energy system has evolved significantly since the last substantive review of maximum resale price. The transition to an increasingly decentralised, digitalised and decarbonised system, driven by net zero ambitions and technological innovation, has seen new challenges and opportunities emerge. Ofgem has begun a review of the maximum resale price to determine whether it delivers fair, transparent pricing and adequate consumer protection and whether it enables investment in the low-carbon infrastructure and services necessary to deliver net zero at the lowest cost.
Ofgem has identified that enforcement mechanisms for the current maximum resale price rules are failing to protect some consumers. That is a key area of its current review, and decisions on any further action that may be needed will be made on the basis of those findings. The review started with a call for input in autumn 2025 to gather evidence, and Ofgem aims to publish a policy consultation in summer 2026. The MRP has an important role across the energy industry: as well as improving the situation for households, changes to the MRP have a potential positive impact on other areas of the energy industry.
I will like to touch briefly on the point that the hon. Member for Yeovil (Adam Dance) raised about his constituent. He may already know that we have announced regulation of third-party intermediaries. We will take that forward through upcoming legislation—this is an important point—to give people more power in brokered energy deals.
Ultimately, households in factored properties feel that their energy costs, for communal areas and otherwise, are too high—because fundamentally they are too high. As hon. Members will know, international gas prices are still 40% higher than in 2021. Permanently reducing energy prices can be achieved only by moving to home-grown, clean power that we control. That is why my Department’s central mission is to deliver a clean power system by 2030 through renewables and through new nuclear power. This is the way to break our dependence on global fossil fuel markets and permanently protect bill payers from higher prices.
The Government are determined to deliver on that mission, and my Department is leading an ambitious programme of work that will make it happen. For example, the creation of GB Energy will help us to harness clean energy; contracts for difference will continue to drive clean power investment, as we have seen from today’s announcement of allocation round 7; the results of AR7 improvements to the capacity market will ensure security of supply while maximising bill payer value for money; and network improvements, with network providers finally making significant investment after years of under-investment, will reduce the costs of operating the energy system for decades to come.
Across all fronts, the Government are taking action to drive down energy bills. Many households in factored properties will also benefit from the announcements that the Chancellor made in the autumn Budget, with action to take an average of £150 off the cost of domestic energy bills by closing the energy company obligation scheme, and providing Exchequer funding to reduce the cost of the renewables obligation for domestic energy suppliers from 1 April. Those measures are designed to provide immediate relief for people across the country and set the foundation for sustained long-term reductions in energy bills through a transition to clean home-grown power. That support, as many hon. Members will know, comes on top of the £150 off energy bills, a measure that was provided by the Government for about 6 million families and was extended—almost doubled—under the warm home discount this winter. It is cutting fuel poverty right now for those consumers who are in receipt of it.
In addition to our work on reducing energy prices, the Government are delivering record investment in upgrading our housing stock through the warm homes plan. We have committed £15 billion to making the biggest ever public investment in home upgrades, upgrading up to 5 million homes by accelerating the installation of heat pumps, solar panels, batteries and insulation. When it is announced, it will come with Barnett consequentials for the devolved Governments, including the Scottish Government, to develop their own schemes under the funding. Alongside our action to make electricity cheaper and more flexible, that is how we are delivering warmer, more affordable homes and repairing a broken energy system.
I thank hon. Members again for being present at the debate, for raising these issues and for all their contributions, which I assure them will be taken into consideration by the Government and by Ofgem as we move forward.
Question put and agreed to.
Oral Answers to Questions
Tracy Gilbert Excerpts(3 months, 2 weeks ago)
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Ed Miliband
There is a two-decade disagreement between the right hon. Gentleman and me on these issues. The biggest threat to the countryside is the climate crisis. That is why this Government are tackling it.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
Oral Answers to Questions
Tracy Gilbert Excerpts(6 months, 2 weeks ago)
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Michael Shanks
The hon. Gentleman is assiduous in raising these sorts of questions with me. I am very happy to look at the possibilities. He is right to outline the potential of sites such as that, and we will look at it.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
Nova Innovation in my constituency is pioneering floating solar, which is generating clean energy. Will my right hon. Friend outline what steps the Government are taking to support the development of floating solar?
Ed Miliband
That sounds incredibly exciting, and I look forward to finding out more.
State of Climate and Nature
Tracy Gilbert Excerpts(6 months, 2 weeks ago)
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Ed Miliband
I wish my hon. Friend luck with the event on Sunday, which sounds important. He is absolutely right: for millions of people the whole warm homes plans is about cutting their energy bills, creating warmer homes and cutting emissions—and they go together.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
Today’s Met Office report says that we need to put in place a highly localised network of rain gauges, as extreme rainfall can be very dangerous. In July 2021, Stockbridge in my constituency faced flooding after a torrential downpour one afternoon, following several days of soaring temperatures. A network of rain gauges will help to analyse the impact of climate change, and also help communities such as Stockbridge to prepare. Will my right hon. Friend outline the Government’s plans in that regard?
Ed Miliband
My hon. Friend draws attention to what sounds like an important recommendation, and as somebody whose constituency saw two once-in-100-year flooding events within about a decade, I know from local experience how serious such issues are. I am glad she has drawn my attention to that recommendation, and we will look carefully at it.
Electricity Market Review
Tracy Gilbert Excerpts(6 months, 3 weeks ago)
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Ed Miliband
The hon. Lady makes a really important point, if I may say so, about the SSEP and, more broadly, about the role of community energy and, for example, rooftop solar. Even before we introduce the future homes standard, we are seeing an increase in the number of new homes with solar panels on their roofs. We have got community energy—which is much more successful in places such as Germany and Denmark—which GB Energy will be powering forward. Also, I am really interested in how we make it more worthwhile for individual householders to install solar panels. It is right for them and it is a way to cut bills. That is what is really exciting about it. We definitely see small-scale and community energy not just as part of our planning for the future, but as something we want to drive forward.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
I warmly welcome my right hon. Friend’s decision today. Zonal pricing sounded like a good idea, but the reality is that the uncertainty about future arrangements was risking investment and would not lead to jobs in green manufacturing in my constituency of Edinburgh North and Leith, or indeed across Scotland. To meet the needs of consumers and businesses, we need a more flexible energy network, so can he set out in more detail how he envisages that happening?
Ed Miliband
I thank my hon. Friend for that really important question. The impact on Scotland is an important dimension here, because Scotland has really exciting plans to drive forward renewable energy, particularly offshore wind. It can be a massive job creator for the future, and it is something we are really focused on. One other issue with zonal pricing is that I fear it would have had quite an adverse effect on the Scottish green economy, which was a point powerfully made by lots of different stakeholders. I can definitely say to my hon. Friend that we are 100% committed. We think that Scotland has a rightful place as an energy capital and an energy powerhouse, and offshore wind is a crucial part of that.
Marine Renewables Industry
Tracy Gilbert Excerpts(1 year ago)
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Tracy Gilbert (Edinburgh North and Leith) (Lab)
It is a pleasure to serve under your chairship, Ms Jardine. I congratulate the right hon. Member for Orkney and Shetland (Mr Carmichael) on securing this important debate.
I want to begin by talking about the exciting link between the Edinburgh North and Leith constituency, and Orkney and Shetland. Nova Innovation, based in Leith, has a very simple mission: to be a global leader in marine energy, delivering clean, predictable energy across the world. In 2016, it installed the world’s first offshore tidal array in Bluemull sound, in the right hon. Gentleman’s constituency, and ever since then the array has went from strength to strength. Three turbines were installed in 2016, a fourth in 2020, and a fifth and sixth two years ago. That installation is not just the world’s first offshore tidal array; it now has the largest number of tidal turbines anywhere in the world. In last year’s contracts for difference allocation round, Nova secured contracts to deliver 6 MW of tidal energy at the Fall of Warness site in Orkney. It is innovating at pace and is demonstrating the potential for tidal and new marine renewables to deliver energy security, and to help with the sprint to clean power.
It is essential that the Government support and guide marine renewables—first, by setting a 1 GW tidal stream target by 2035, which would send a signal to industry about their support and ambition. I am keen to hear from the Minister what consideration the Government have given to putting in place such a target.
Secondly, GB Energy could help to harness the potential for tidal power here and across the globe. Nova in my constituency has demonstrated that the technology can work, and our tides and sea mean that we have 11 GW potential domestically. If GB Energy took equity stakes in tidal stream projects, those projects could be scaled up not only to benefit from that 11 GW earlier, but to build up domestic manufacturing, domestic supply chains and to deliver jobs. I appreciate that there is smaller demand for tidal overall than for other renewable sources, but at present 8% of the tidal supply chain is in the UK.
Thirdly, we need to speed up the consent process, and I welcome the decisions taken by the Department for Energy Security and Net Zero in that regard. Stakeholders have expressed their dismay to me that, although Canada can secure consent and start construction within two years and France can do similar within three, the process can take up to a decade in the UK. I am concerned that if the timescales cannot improve, we will fritter away our competitive advantage not just with marine renewables but across a large number of established and innovative technologies. I appreciate that consenting is devolved to Scotland; the Minister knows that I have raised the unacceptably long process for consent decisions with the Energy Consents Unit and Marine Scotland, and I would welcome an update on the recent discussions he has had with Scottish Ministers on consenting.
I hope that the Government will listen to today’s debate and fully back marine renewables, and that in the future there will be a stronger link between Edinburgh North and Leith, and Orkney and Shetland, with more tidal energy generated.
Oral Answers to Questions
Tracy Gilbert Excerpts(1 year, 3 months ago)
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Michael Shanks
I was not aware when my right hon. Friend the Secretary of State changed the titles of the ministerial portfolios that we had moved away from having a Minister for consultation, but it seems that all the hon. Gentleman was doing in his time in office was launching consultations. We are going to get on with delivering and we are moving at pace on the whole of the electricity system, including on nuclear, and delivering on the things that he failed to do.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
The Secretary of State for Energy Security and Net Zero (Ed Miliband)
As well as our measures on onshore wind, solar and renewables, this Government have begun legislating for Great British Energy and setting out our plan for proper standards for private and social renters to take 1 million families out of fuel poverty, and on Friday we announced deals to kick-start Britain’s carbon capture industry. All of this will deliver our mission to make Britain a clean energy superpower. It is right for bills, right for energy security, right for jobs and right for climate leadership.
Tracy Gilbert
I welcome the actions outlined by my right hon. Friend, particularly the recent announcement that GB Energy will be headquartered in Aberdeen, with satellite offices in Edinburgh and Glasgow. Can he outline the role that he expects the satellite offices to take? Given the investment already under way in the port of Leith for a number of renewable companies, as well as the prospects for the supply chain and manufacturing, will he consider Leith as the location for the Edinburgh site?
Ed Miliband
My hon. Friend is absolutely right to draw attention to our announcement on Aberdeen as the headquarters of Great British Energy and the important role that it will play, and also to the importance of the satellite offices. I know from my visit to her constituency of the huge potential of her area on these issues, and we want to drive jobs throughout the supply chain through Great British Energy.
Contracts for Difference
Tracy Gilbert Excerpts(1 year, 4 months ago)
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Ed Miliband
I think that tonight, the hon. Gentleman will think that that was not a very smart point to make. Weeks after we came into office, the price cap went up. I have explained why the price cap went up—because of our reliance on international gas markets. The decision that he has to make is this: does he support our mission to make Britain a clean energy superpower in order to bring bills down, or does he not?
Tracy Gilbert (Edinburgh North and Leith) (Lab)
There is one notable absence from the allocation round results today, which is Berwick Bank wind farm. Located in the North sea, Berwick Bank has the potential to deliver up to 4.1 GW of clean electricity, and to lead to further investment in the supply chain and manufacturing. The port of Leith in my constituency is a prime location for the project, but we are still waiting to hear about the consent. Can the Secretary of State confirm that he will push the Scottish Government to speed up their section 36 consent process, so that Berwick Bank can come forward in the next allocation round and we can get on with delivering a sprint to clean energy?
Ed Miliband
I am glad that my hon. Friend has raised that point. We face planning decisions and questions at a policy level, if I can put it that way, right across the United Kingdom, including in Scotland and in England. We will work with the Scottish Government and others to make sure that we have a planning system that is fit for purpose, and that can build the clean energy that we need.