Lord Frost (Con)
My Lords, I thank the right reverend Prelate, the Government and the Minister for proposing and enabling this debate today. It is an extremely important subject. I also thank the noble Baroness, Lady Parminter, for her committee’s report on this subject, as has been mentioned.
We all agree, I think, that decarbonisation is a very desirable goal, but that aspiration is different from the specific net-zero 2050 policy. That target was essentially invented by the Climate Change Committee in 2019, passed through secondary legislation in this Parliament with limited debate and, since then, has been creating radical change to the economic structure of this country. My own party is just as much to blame for this situation—possibly even more so—as the parties of noble Lords opposite.
To be fair to the Climate Change Committee, it correctly stated in 2019 that there would need to be policy change to deliver this goal. It specifically mentioned decarbonisation of industry, the grid, insulation, renewables, boilers, carbon capture and storage, and so on. Now, however, we find, first, that all these technical measures are extremely expensive to install; secondly, they make energy and normal life very expensive for people; and, thirdly, they are increasing the unreliability of the energy sector, worsened by the destruction of energy supply that is actually reliable and by the addition of too many renewables that destabilise the grid.
We see a situation where the technology does not deliver the goal or aspiration by 2050 and behavioural change is beginning to fill that gap, which I find somewhat troubling. I will make three remarks. First, “behavioural change” is a nice phrase, but let us look at what it actually means: it means making it harder for people to do things that they would otherwise choose to do. One of the Government’s slogans is:
“Make the green choice affordable”.
Another way of putting that is: subsidise substandard and ineffective technologies, chosen politically by government, which people would not choose to use otherwise. Behavioural change, then, reduces human welfare, making people do things that they do not want to do, rather than things they do.
Secondly, if we take the phrase at face value, behavioural change should be voluntary. It means encouraging or nudging, but it often feels as though that is not what is being described. In 2021, the Climate Change Committee said:
“Behaviour change … comes through consumer adoption of low-carbon technologies such as electric cars”.
You do not get any choice about that: from 2030, you have to buy an electric car. That is not nudging but compulsion. The same is true for heat pumps from 2025 and closing roads for cyclists—it is all compulsion.
The same is true of the aspiration to learn from the pandemic set out in the committee’s report, from which I note my noble friend Lord Lilley wisely dissented. Yes, behavioural change was encouraged during the pandemic, but the key aims were achieved by legal compulsion: making it illegal to leave your home and meet people, and fining you if you did so. That is not nudging but simple compulsion, and if people mean legal compulsion, they should say it.
Finally, we are already in a society where far too much is governed by politics, which is too much in every sphere of everyday life. I worry that behavioural change and climate measures are shrinking the private space of individuals. They turn every decision—every time you go to the supermarket or travel—into a political act, which is a bad thing for society. Free societies should have large spaces where there is free choice.
I conclude by urging the Government on this. They have done quite enough encouragement of behavioural change as it is; there is no need for more. The right way to the decarbonisation goal is on the supply side. Provide the energy that people need but do not tell them not to use it. The right way forward is from natural gas to nuclear, with renewables at the margin, and investment in new technology—batteries and hydrogen—so that we have the low-carbon power that a modern industrial society needs. That is the way forward.
The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)
I thank everyone who has contributed. On the last point made by the noble Baroness, Lady Blake, she is perhaps attributing more power and influence to me than I might have in the selection of the next Prime Minister, but I thank her for her faith in me.
I thank the right reverend Prelate the Bishop of Oxford for bringing forward this very important debate on steps the Government will take to support behaviour change as part of the pathway to net zero emissions. I also thank the House’s Environment and Climate Change Committee for its report on the Government’s approach, and all those who contributed to that report. I start by assuring the House that the Government recognise that achieving our net zero target will be challenging and will require enormous changes to our energy systems and infrastructure. I want to reassure the right reverend Prelate that we take the concerns raised in the Select Committee report seriously and will carefully consider all its recommendations.
In response to the noble Baroness, Lady Parminter, we know that public concern about climate change is high and has doubled since 2016, with 85% of people telling pollsters that they are either concerned or very concerned, although it is fair to point out that the potential solutions are not as well known to members of the public. Many people think that they are doing their bit by putting their recycling out, which of course they are, but the extent of the additional changes required is quite severe, and I am not sure that there is so much support of that.
Nevertheless, in terms of the information that is given to them, many members of the public have shown that they are willing to make green choices to combat climate change and to reduce their own costs, provided that they are not too severe or too impactful on their everyday lives. As many businesses and civil society organisations are already leading the way in engaging the public on net zero, the role of government is to set the overall direction, our priorities and a narrative to support that transition.
I agree with my noble friends Lord Frost and Lord Lilley that we want to support the public in making these green choices in a way that maintains people’s fundamental choices and freedoms. My noble friend Lord Frost made some excellent points but, based on very good Conservative principles, we should be supporting more renewables because they are cheap. The cost of offshore wind is now a sixth of the price of gas-generated power. From good Conservative liberal principles, we should be supporting more of that. I totally accept that he will say, “but it’s intermittent”. He would be right, so we need more baseload power from nuclear and other carbon-free sources. Nevertheless, at the moment, with sky-high gas prices, renewables producers on contracts for difference are paying hundreds of millions of pounds back into the system, because the prices are above their strike price, and are subsidising people’s bills, which would have been even higher without this production.
Whatever view you take on climate change, however sceptical you are, just from an energy security point of view we should be generating more power on our own shores, rather than paying some very unstable and unpleasant people in other parts of the world for our power, and we should be doing this because it is cheap at the moment. The CfD scheme has been so successful, particularly in generating large amounts of offshore wind power, that the rest of Europe is trying to follow us with essentially the same systems. We have very ambitious plans to roll out more of it, but that will probably be quite difficult, given the supply chains and that everybody else will be trying to do the same.
As referenced by the noble Lord, Lord Grantchester, and the noble Baroness, Lady Blake, in our net-zero strategy we set out clear principles outlining how we will empower the public to make green choices by making those choices easier, clearer and more affordable, and by working with industries to remove barriers to those cleaner choices. I can happily assure the noble Baroness, Lady Blake, and the noble Lord, Lord Browne, that we are indeed helping people to know how they can play their part by supporting them in making green choices. It is not through a hectoring campaign or through compulsion, but by providing people with clear advice on what they can do to save themselves money and save the country money. It is set out in our Heat and Buildings Strategy, which is about enabling people to do the same things differently and more sustainably. It sets our approach for engaging the public, both in communicating the challenge and in giving people a say in shaping future policies.
Let me give some examples of government support. We are putting our principles into action using a range of policy measures that support the public to make those greener choices across different sectors. We are of course helping people to travel more sustainably. We are not preventing them from travelling—that would be wrong—but helping them to do it more sustainably by better integrating transport modes, by having more bus routes serving railway stations, and by improved integration of cycling and walking networks.
The noble Baroness, Lady Sheehan, welcomed the uptake of electric vehicles. We do need that, of course, but we are also investing £2 billion in building more cycle lanes and low-traffic neighbourhoods—which have varying degrees of popularity, depending on where they are implemented. We also announced funding worth £200 million for new walking and cycling schemes across England, through a new body called Active Travel England, overseeing 134 fairly ambitious projects. This new body will ensure that the Government’s unprecedented investment in active travel makes the green travel choice easier for the public.
In response to the noble Baronesses, Lady Sheehan and Lady Parminter, and the noble Lord, Lord Grantchester, the Government’s approach to decarbonising our heat and buildings is set out in the Heat and Buildings Strategy, which provides a clear long-term framework to enable industry to invest and deliver the transition to low-carbon heating and retrofitting measures, In this strategy, the Government have set out a combination of policy measures to address a range of practical barriers to some of those choices.
From good conservative principles I am also a great believer in energy efficiency. The cheapest energy is that which we do not use. There is some practical advice that we can offer to people—again, not in a hectoring way but clear and simple advice. The one that I am the keenest on is turning your boiler flow temperature down. You can achieve the same heat in your house and be just as warm, but you can do it about 8% to 10% more efficiently, saving on your gas bills, saving the country money—saving taxpayers money at the moment, because we are subsidising energy prices—and helping our energy security. What is not to like about these measures? This is something that we can clearly and easily support, and we will provide advice to the public on how to do things such as that. Many energy companies and others are already doing that, and we will support them in those advice sessions.
We are making the transition to low-carbon heating cheaper for households because—I again agree with my noble friend Lord Frost—people will not make these choices until we make them simple and easier, and we can demonstrate to them that they will save money by adopting measures such as heat pumps and other low-carbon heating measures. We can do that by rolling them out and decreasing the costs over time, but it is very much in its infancy at the moment, so it will take time to build these policies up. Nevertheless, we are supporting the transition with the £450 million boiler upgrade scheme, which is providing £5,000 in capital grants to households. We are also rolling out a consultation on a new market-based incentive for heating system manufacturers.
In response to the noble Lord, Lord Grantchester, who referenced the ECO scheme—the energy company obligation—we are boosting its value under ECO 4 from £640 million to £1 billion a year from 2022 to 2026. That will help an additional 450,000 families with measures such as insulation and better boiler control. The noble Lord also referenced the ECO Plus scheme, one of the measures that so far seems to have survived from the mini-Budget.
In response to the noble Baroness, Lady Sheehan, and my noble friend Lord Lucas, on addressing information gaps and helping consumers make informed decisions, this summer we launched a new energy advice page on GOV.UK. I encourage all noble Lords to check it out. This is a website where you can put your personal details in, and it links to the EPC database and provides home owners with personal, tailored advice about the energy performance of their homes. We hope to extend it even further to provide signposts to the different measures of support that are available to people in future. Nevertheless, it provides excellent advice to home owners on how they can save themselves money and increase the country’s energy security.
These policies, which seek to address some of the major practical barriers to individual behaviours, will bolster the low-carbon heating market and create new opportunities for businesses and better choices for consumers. My noble friend Lord Lucas and the noble Baroness, Lady Parminter, made some acute observations on the affordability of making green choices. Both noble Lords will be aware that Chris Skidmore MP is leading a rapid review of the Government’s approach to net zero to ensure that we deliver on that now legally binding target in an economically efficient and sensible manner. I do not want to pre-empt the findings of the review but I believe his intention is to publish by the end of the year.
As I have set out today, the Government recognise that achieving the legally binding net-zero target has to be a shared endeavour and requires action from everyone in society, including people, businesses and the Government. We are committed to taking practical steps to support the public in making green choices in a way that supports their fundamental freedoms, supports their freedom of choice and maintains their individual freedoms. We will continue to take this approach across net-zero policies to support the UK’s transition to a green and sustainable future. As I said, we are carefully considering the recommendations in the Environment and Climate Change Committee’s report. We will publish that response in due course, in line with normal parliamentary procedures. I thank the committee for its consideration.