Access to Broadband Services

Debate between Ben Lake and Liz Saville Roberts

Wednesday 6th September 2023 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

It is a pleasure to serve under your chairmanship, Sir Christopher. I congratulate the hon. Member for Stirling (Alyn Smith) on securing the debate and making such an impressive introductory speech. Indeed, I agree with all his points, so I will try to keep my remarks brief.

As with other Members—especially those who represent rural areas—the need for better broadband is something that fills my inbox almost weekly. As the hon. Member put it, broadband and digital connectivity have become the fourth utility, so it is no surprise that in my constituency, where 14% of premises can receive speeds of only up to 10 megabits per second, a lot of people are concerned about improving their digital connectivity, given the demands of education, businesses and leisure. Sadly, in Ceredigion the percentage of premises that cannot receive what Ofcom describes as decent broadband is 2.2%, compared with the UK figure of 0.2%.

As others have, I place on record my belief that there has been great progress in recent years in improving broadband infrastructure, in Ceredigion as well as in other parts of the United Kingdom, but there is more that we should do. As others have mentioned, the Government could make changes to the gigabit voucher scheme and Project Gigabit to accelerate progress. One concern among my constituents in communities that do not have decent broadband—certainly not gigabit broadband—is that they will have to wait several more years before any progress is made with their communities.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

Knowing my hon. Friend’s constituency, I am sure he will recognise the problem faced by the small community in Nantmor and Beddgelert in my constituency, where there is no mobile signal—an EE Home Office mast is in place, but it is not turned on—and a history of electricity outages, not over hours but over days. Analogue copper lines were switched off earlier this year, and the community is now awaiting a decision on whether the exchange will be eligible for a fibre community partnership. This is a real challenge—a real crisis—for many of our communities, and they have nowhere else to turn.

[Ben Lake]

I thank my right hon. Friend for that important point. In the 21st century, it is rather strange to stand here and talk about communities in the United Kingdom that are completely cut off from the outside world, especially during severe weather events. She mentioned a community around Beddgelert. I also have communities, such as Cwmystwyth, that have been told that, as soon as the copper landline network is switched off, they will have to depend on a broadband connection. Sadly, Cwmystwyth does not have one, and it does not have mobile signal, so it is left without any form of communication in the event of a storm.

As has been pointed out already, adequate and improved broadband infrastructure in rural areas can make a significant contribution to the community in not just a social but an economic sense. This afternoon, I received an email from a constituent who explained that she works for a company—a charity, as it happens—that is based and does work across the UK. She very much wants to stay in Ceredigion to continue that work, but she depends on a decent broadband connection. Sadly, where she lives is unlikely to receive an upgrade any time soon.

The last census showed that the population of Ceredigion constituency had dropped by 5.9%. We will not get into the technical detail of why that happened, but we know from covid in particular that a number of people who were doing hybrid working decided to relocate to Ceredigion. So rolling out good connectivity across the county would make a massive demographic contribution. It is probably worth emphasising that it would also make a contribution to the delivery of public services, getting staff into our schools, care homes and other important public services, which is something we already struggle with.

One thing I would like to emphasise is the good work that the Government have done to date on the gigabit voucher scheme. Ceredigion is very fortunate in being one of the pilot areas. I have tried to gauge the demand from communities to sign up to the vouchers, and I am pleased to say that communities in Ceredigion responded very positively—I believe it is one of the best areas in terms of the number of declarations of interest. Since then, community co-ordinators have gone to considerable effort to ensure that communities are aware of the different options and that they register their interest and their vouchers, and some communities have succeeded. Some communities in Ceredigion have had their broadband connections improved considerably, and it has made a fantastic difference.

However, as the hon. Member for Westmorland and Lonsdale (Tim Farron) mentioned, others have found themselves caught in a bit of a limbo in recent months, because the voucher funding does not seem to be forthcoming from BDUK. It is possible that that has to do with work the Government are doing with Project Gigabit in mapping out the intervention areas, and I would be grateful if the Minister could clarify that.

Nevertheless, some of the community co-ordinators and those participating in the schemes are growing restless. In Wales, they have seen the best part of a decade of promises of improved connectivity that have come to nothing, so it is inevitable that people start to question whether the schemes will actually work for them. I fear that a lot of the demand and interest will dissipate the longer we go without any real progress. Will the Minister clarify whether the Government intend to accelerate some of the voucher schemes in the interim as we wait for the Project Gigabit areas to take off? It strikes me that, where community areas have engaged with each other, organised and registered an interest, we might as well get on with connecting them. Even if that means that it is only a couple of hundred or 1,000 premises in Ceredigion, it is better than nothing.

That brings me to Project Gigabit and the intervention areas. Although I very much welcome the fact that the Government are investing so much money in that endeavour, I have a concern about part of Ceredigion—sadly, we have been split in two in this process; the north is in a type C procurement contract, and it remains to be seen what the south-west Wales lot will look like. The point I want to raise with the Minister and seek his assurances on is that we will not drag our feet in making a decision, as opposed to the south-west Wales lot. I have already heard rumours that a decision might not be made until summer 2024. I am told by industry officials that, once contracts have been awarded, there will be a good six months of scoping, surveys and all the preparatory work and that, depending on where people are, it could then be two or three years before the connection is sorted. That concerns me because many of these communities will be in rural areas that do not have a mobile signal. They have no alternative methods of connectivity, and that is holding them back.

As my right hon. Friend the Member for Dwyfor Meirionnydd (Liz Saville Roberts) mentioned, many of the hardest-to-reach properties lack any other form of communication. There needs to be greater co-ordination and prioritisation of the effort to connect the hardest-to-reach areas. By co-ordination I mean that we should think about the areas that lack a mobile signal, full fibre or broadband of any description and ensure that the digital switchover of landlines is paused. I know that that will entail work with BT and Ofcom, but that co-ordination is essential if we are to ensure that communities are not cut off.

In terms of prioritisation, I can foresee a situation with the Project Gigabit and intervention area approach whereby residents who currently enjoy superfast broadband download speeds of 17 megabits per second will be connected to full gigabit, which is great—fantastic. At the same time, constituents who currently lack any broadband whatever will still be left waiting. Will the Minister assure me that there will be some prioritisation and that premises that currently receive decent broadband are perhaps second in line to those that lack anything at all?

Energy Company Obligation Schemes

Debate between Ben Lake and Liz Saville Roberts

Tuesday 27th June 2023 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

I beg to move,

That this House has considered the implementation of ECO4 and ECO+.

It is a pleasure to serve under your chairmanship. Mr Paisley. I am grateful for the opportunity to discuss the importance of energy efficiency schemes for domestic properties in general, and more specifically the implementation of the energy company obligation 4 and energy company obligation plus schemes.

As everybody will be aware, households have had to endure wave after wave of challenges to budgets in recent months, with each adding to the financial burden on families and eroding living standards. Although we have recently received welcome news that falling wholesale energy prices will begin to feed through to households, it is unlikely that energy bills will return to pre-crisis levels any time soon.

A frequently cited statistic that bears repeating, lest we allow current prices to be normalised, is that in April 2022 the Welsh Government estimated that energy bills of £1,971 would push 45% of Welsh households into fuel poverty. Next month, when Ofgem’s price cap kicks back in, it will still be marginally higher, at £2,074. The New Economics Foundation suggests that that pressure will continue into next year, with energy bills in April 2024 estimated to be as high as 70% above pre-crisis of 2021 levels. To put it simply, for too many households energy prices will continue to be a significant pressure on their budgets for some time to come. Households will also be more vulnerable this coming winter, after being forced to use savings or take out debt to make it through last winter.

Citizen Advice Cymru has seen an increase in the number of people seeking debt advice, and reports that more people are falling into arrears on essential household bills. The number of people seeking advice on debt relating to energy bills, for example, has more than doubled between May 2021 and May of this year. Although that is not the purpose of today’s debate, it demonstrates why short-term relief with energy bills is still required, including another round of the alternative fuel payment for off-grid households next winter.

In the long term, the energy crisis has thrown into very sharp relief the urgent need to implement measures to bring down energy bills permanently for households and businesses. One solution is to transition to renewable energy sources, another—the focus of today’s debate—is to introduce comprehensive policies to enhance the energy efficiency of the UK’s housing stock.

That issue is particularly acute in Wales, given that we have some of the oldest and least efficient housing stock in western Europe. Data from the Department for Levelling Up, Housing and Communities shows the percentage of dwellings within each local authority with energy performance certificates rated level C or above. The data shows that five out of the 15 local authorities with the smallest percentage of dwellings with EPCs rated level C or above are in Wales, with Gwynedd third from bottom at 23% and my constituency of Ceredigion only slightly better at 25%.

It is perhaps not surprising that Ceredigion does so badly, when we consider that 35% of our homes were constructed in the 19th century. It is sobering to reflect on the fact that the vast majority of the county’s 2050 housing stock has already been built, more than a third of it in the Victorian age. The case for action is, therefore, quite clear and simple. We need to upgrade the energy efficiency of our housing to reduce people’s exposure to increased energy costs. Almost a quarter of tenants in the private rented sector live in fuel poverty, with those living in the least efficient homes spending as much as £950 more per year on their energy bills, compared with homes rated EPC level C.

The UK Government have made the case that it is unsustainable to maintain support indefinitely for households with energy bills. By retrofitting, we can mitigate the need for ongoing and future support packages. Indeed, the New Economics Foundation estimated that had all homes in England and Wales been upgraded to EPC level C by October last year, the energy price guarantee would have cost £3.5 billion less over its first six months and households would have saved an average of £530 over the year.

Of course, retrofitting would also have significant beneficial outcomes for health. We know that living in a cold home can worsen asthma and other respiratory illnesses, and increases the risk of heart disease and cardiac events. It can also worsen musculoskeletal conditions such as arthritis, as well as having a detrimental impact on mental health. Wales’s Future Generations Commissioner estimated that a comprehensive home retrofitting programme could save the Welsh NHS as much as £4.4 billion by 2040 by tackling some of those health issues.

Finally, reducing household energy demand is of course vital for us to improve energy security, reduce our reliance on fossil fuels and, of course, realise our climate targets. A coalition of charities, including Fuel Poverty Action and Green Alliance, have warned that without action on housing and buildings, there is no plausible path to achieving the fifth carbon budget or meeting the 2030 statutory fuel poverty target.

It is clear that home retrofitting is vital and that action taken now will place the UK in a good position in the future. The UK Government’s flagship fuel poverty reduction scheme, the energy company obligation or ECO, has a key role to play in upgrading our homes to permanently reduce the cost of heating for households and to address fuel poverty. ECO has operated since 2013 in several iterations and up to March of this year it had delivered a total of 3.6 million energy efficiency measures in Great Britain. The energy performance improvements that have been delivered have saved low-income customers as much as £17.5 billion in lifetime energy bills and saved the average home some £290.

ECO4 is, of course, the fourth iteration of the scheme. It began in April last year and is planned to run until March 2026. In the past year, however, installations have dropped quite significantly. All versions of ECO have experienced difficulties in some form or other, but ECO4 has undoubtedly been delivering at a slower rate than previous iterations. Energy suppliers and installers are now warning that structural issues are preventing the scheme from fulfilling its potential and I want to dwell on those issues today.

Between April last year, when ECO4 commenced, and March this year, approximately 45,000 households had received support under the scheme. Given that that is around 10% of the 450,000 households that the scheme is supposed to support over its four-year lifetime, there is concern about the pace of the roll-out so far. One reason might be that the number of measures installed per property during the roll-out of ECO4 to date has been much higher than expected, with an average of nearly 3.5 measures per property since April 2022 compared with the average of 1.8 measures expected in the scheme’s final impact assessment. In the first quarter of 2023, the figure increased to an average of 4.93 measures per household.

E.ON Energy estimates that, as result, industry could achieve its overall national bill saving target by delivering ECO4 to only 215,000 properties of the 450,000 targeted. Of course, it is not a bad thing that energy efficiency is being significantly improved for those households supported by ECO4, but it raises a question about the adequacy of the funding in place if ECO4 is to achieve its target of supporting 450,000 households, as I am sure that Members will agree.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

I agree entirely with my hon. Friend, as I am sure that many would, that this is primarily a question of funding. We should take a step back and realise that Shell has directed £5 billion in windfall profits towards its shareholders in the first quarter of this year, so there is surely a good case to be made for an emergency windfall tax to enable additional work for the other households that would benefit so much from it.

[Ben Lake]

I am very grateful to my right hon. Friend for that important intervention and you will be unsurprised, Mr Paisley, to hear that I agree with her that there is an important opportunity to introduce emergency measures. At the end of the day, energy companies are making eye-watering amounts of profit at a time when households across the country are struggling. I think it is very appropriate for us to consider ways of recouping some of that potential income to put against this important measure.

Adjustments are required to get the scheme back on track so it can achieve its full potential. The first adjustment requires the UK Government to look again at ECO4’s cost assumptions. They were finalised in April 2022 and do not reflect current market conditions, including the escalation in costs caused by labour shortages and manufacturing prices. More recent cost assumptions, such as those included in the Great British insulation scheme’s impact assessment, reflect those price increases.

For example, the fixed assumed costs of installing external solid wall insulation, which comprises 12% of measures installed under ECO4 to date, increased from £4,200 in 2021 to about £5,000 in 2022—by almost 20%. Meanwhile, the UK Government estimate that the cost of installing cavity wall insulation for bungalows, as well as detached, semi-detached and end-of-terrace houses, has increased by 50% to 63%. That is all without factoring in the inflationary pressures we have seen in 2023 so far. At the start of 2023, insulation and associated material prices increased significantly, many by close to 10% and some by as much as 35%, compounding similar increases seen last year.

Another aspect of the scheme that requires attention is the minimum requirements threshold, which means that a household’s energy performance certificate must be improved to a particular level. For example, if band D and E homes are to be eligible for the scheme, they have to be upgraded to at least band C, and band F and G homes must be upgraded to at least band D. We should welcome the intent of that requirement. Providing support to the poorest households in the least efficient homes by bringing them up to a significantly higher energy performance rating is an important objective. Nevertheless, the requirement is proving to be a limiting factor on the scheme’s delivery. I have spoken to installers and energy suppliers who say that the minimum requirements are too inflexible compared with previous schemes.

It is suggested that the requirements are making it difficult to find eligible properties, and installers are reporting difficulties in proving how properties in higher EPC bands, such as those in band D, as well as on-gas properties, can meet the requirements. E.ON Energy estimates that around 90% of qualifying fuel-poor households cannot have works delivered to their properties, as either they fail to meet the minimum requirements threshold or it would be economically unviable to upgrade them to the levels required to meet it.

[Ben Lake]

The reality is that a very high proportion, if not the majority, of homes in rural constituencies find it difficult to access the scheme because they are not on the mains gas network. In my constituency, some 72% of properties are not connected to mains gas and they are struggling uphill to get on to the scheme. The Government would do well to look again at whether we can change the ECO Flex pathways to allow local authorities greater flexibility to support off-grid properties in particular. That might be a way forward. We certainly need to address the issue. If we do not, I worry that rural areas, which often have an older, less efficient housing stock, will be left behind. I am grateful to the hon. Gentleman for making that important point.

As greater investment is required per property to meet the minimum improvement threshold requirements, the current iteration of the scheme appears to be more exposed, and therefore more vulnerable, to the inflationary pressures that I mentioned earlier, so we need to look again at how it is funded. I ask the UK Government to look at that very carefully.

Another aspect of ECO4 that is welcome in principle, but which is putting pressure on those delivering the scheme, is the Flex pathway. The pathway is important, because it enables local councils to identify low-income households that are in need of support, but that are unlikely to be eligible under the scheme’s standard approach. It also provides an opportunity for local councils to better tailor energy efficiency schemes to their respective areas, and I refer back to the remark from the hon. Member for Central Suffolk and North Ipswich (Dr Poulter) about rural properties. The issue, however, is that local councils feel that the Flex pathway is too onerous and that the information required of them for each application takes up significant staff time and resources. Indeed, I am told that the level of detail required can make the Flex pathway inflexible when considering different local factors.

One of those factors is the nature of the housing stock in an area, and I have already mentioned that Wales has some of the oldest and least efficient housing stock in western Europe. I spoke to representatives of Gwynedd Council, who expressed concerns that the products available via ECO do not always work well with the design of older houses.

[Liz Saville Roberts]

On that point, I would like to mention Meilyr Tomos at Gwynedd Council, who supplied me and others with advice on this debate. In relation to the ECO Flex programme, another issue in Gwynedd is second homes. Younger people are now priced out of staying in their own homes, and more non-dependant children are remaining with their parents—between 2011 and the 2021 census, in Gwynedd the figure increased by 6.8%. Given that non-dependant children artificially inflate household incomes, that has a knock-on effect on ECO Flex. The Government would be wise to give due attention to such rural issues.

[Ben Lake]

I agree with my right hon. Friend. The Flex pathway offers a real opportunity to allow the policy to be tailored to the specific needs of local areas, so as to accelerate the delivery without impacting on the broader scheme that the Government have implemented.

The consequence of rising costs and a perceived inflexibility in the structure of the scheme has been that supply chains are starting to stutter, and I am told that many installers are leaving the market. The Installation Assurance Authority warns that there are now fewer than 10,000 people involved in the industry and public-funded schemes, whereas there were 54,000 in 2012. Those who have moved away from ECO4 are reluctant to return. If installers continue to leave the market at this rate, it will make it very difficult not just to deliver ECO4, but to achieve the level of home retrofitting required to meet our future climate and fuel poverty targets.

If those issues are not addressed, thousands of eligible households will miss out on crucial energy-saving measures, meaning that they will face higher energy bills this winter and beyond. I believe that the Department for Energy Security and Net Zero is consulting on the deliverability of elements of ECO4. If it intends to do so, I ask that they publish the consultation before the summer recess in order to allow sufficient time ahead of April 2024 for industry to adjust accordingly. A failure to do so may mean that even more installers drop out of delivering the scheme due to continued uncertainty.

It is not too late to get ECO4 back on track, and I would argue that a consultation could play a key part in doing so, but I would appreciate it if the Minister could explain what consideration has been or will be given in a consultation to the following points. Could ECO4’s cost assumptions be revised in line with current supply costs to reflect current market conditions? Could the eligibility of homes be widened to ensure that more people can benefit from the scheme? That could include increasing the number of fuel-poor households eligible in the private and social rental sector, or it could mean enabling the Flex channel to be more responsive to local needs in order to be able to capture more fuel-poor households, such as those in receipt of means-tested benefits or with health conditions.

Another suggestion is that we investigate the possibility of extending the buy-out mechanism, so that others besides energy suppliers can take on obligations, and enable local councils to deliver ECO. Other suggestions are: making long-term funding available for training, so that we can boost the supply chain, and considering measures to boost recruitment and careers in the retrofitting energy efficiency industry; ensuring continuous and open engagement with installers, energy suppliers and other industry and fuel poverty experts, to guarantee that the scheme remains on the right track and to ensure that the UK Government can respond effectively to any future issues that arise; and finally, exploring the possibility of expanding the range of technologies that will be considered in scope in future iterations of ECO4 to, for example, water control technologies, which can help bring down the cost of energy used to heat water.

I will briefly touch on ECO+ or, as it is now known, the Great British insulation scheme. I of course welcome the scheme, which is designed to support households in installing single energy efficiency measures in their homes, but again possible adjustments could vastly improve delivery. Can the Minister say what consideration has been given to refining the scheme’s targeting, so that it better helps fuel-poor households? For the majority of the scheme, households are expected to make a financial contribution to the cost of the measures. That will effectively make a large proportion of the scheme inaccessible to the lowest-income households, which cannot afford to make those contributions. In a cost of living crisis, when disposable income is diminishing across the UK, surely the requirement for contributions should be taken out of the scheme, or the percentage of participants who are expected to make contributions should to be lowered.

It would be remiss of me not to mention that I have heard from constituents who were unfortunately let down by contractors delivering measures under the ECO4 scheme. Of course, any measures installed are now covered by the UK Government-endorsed quality scheme, TrustMark. I appreciate that incidents of poor delivery may be isolated examples, but in those worst-case scenarios where delivery goes horribly wrong, the protection and security for households is still inadequate.

[Liz Saville Roberts]

I would be grateful if the Minister addressed the issue of providers who place solar panels on agricultural land, but do not guarantee against damage caused by animals. Obviously, placing panels on agricultural land is very convenient, and it makes access cheaper, although attention is not always paid to planning requirements. However, the convenience may be outweighed by the risk for the householder of damage caused by animals that is not covered by a guarantee. I very much wish the Government to address that rural issue.

[Ben Lake]

I thank my right hon. Friend for raising another important point. It perhaps illustrates the need to strengthen the accountability of the scheme. In Ceredigion, households have had measures installed that were of substandard quality, and they find it almost impossible to get information about redress and holding the installers to account for the sub-par work. Her concerns would be captured by a broader effort to improve the scrutiny and accountability of the scheme. Will the UK Government consider ways of improving oversight of installations? We need a stronger mechanism by which installers can be held to account.

Before closing, I will touch on the need to incentivise those who are ineligible for the ECO scheme to invest in retrofitting—those who might have the means to do so. A few measures come to mind. First, could we look again at removing VAT from insulation products, and not just from the installation of these products, as well as from storage batteries? I appreciate that that might be a Treasury matter. What work might the Government undertake on providing interest-free loans to those who wish to install energy efficiency and low-carbon heating measures? Providing access to such support will be even more important in the face of steep interest rate hikes.

Finally, I come to another area that deserves a brief mention in a discussion on how we can help households to bring down energy bills and expand our renewable capacity: incentivising households to invest in smaller-scale renewables. I have been contacted by several constituents who are concerned that the reduction in support from the feed-in tariffs—and now their replacement, the smart export guarantee—has vastly reduced the incentive to invest. I urge the Government to consider increasing the tariffs that the energy suppliers are required to offer to homeowners who generate renewable energy. I draw my remarks to a close, and very much look forward to the comments of my colleagues.

Spring Budget: Wales

Debate between Ben Lake and Liz Saville Roberts

Wednesday 29th March 2023 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

Diolch, Mr Hollobone; it is an honour to serve under your chairmanship. I congratulate the hon. Member for Newport West (Ruth Jones) on securing this important debate. It is a pleasure to follow my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards). I fear that I need not reiterate many of his points in my own speech because he made them so eloquently and effectively.

Before I address the substance of the spring Budget, it would be remiss of me not to comment on the report published earlier this week by the Senedd’s Public Accounts and Public Administration Committee, which found that due to a budget underspend in 2021-22, the Welsh Government breached the limits of the Welsh reserve. Other Members have commented on that this afternoon. I would just add, echoing the point made by my right hon. Friend the Member for Dwyfor Meirionnydd (Liz Saville Roberts), that it cannot be right—it is certainly inconsistent and illogical—that any underspend in a UK Government Department returns to the UK Government, but the same does not apply to any underspend in Welsh Government Departments.

I turn to the issues facing the spring Budget. High on the agenda was the rising cost of living. Much has been made of the measures included in the Budget that aimed to support households and businesses with energy costs. We have heard comments to that effect this afternoon. The Chancellor was right to identify that as a key concern, but given that energy bills are still expected to increase by some 17% next year, the Budget did not go far enough. To help families see out the spring, the Government could and should have considered extending the energy bills support scheme.

I do not dismiss the extension of the energy price guarantee, which will be a great service to a lot of people across Wales, but the measure does not offer the 74% of my constituents living in off-grid homes support with their fuel costs. There should be further support for off-grid households; I would welcome a further round of the alternative fuel payment, for example. It is difficult to deny the inconsistency in the level of support offered to off-grid households compared with those connected to the mains gas grid, and I am sure the Government would want to address that.

Meanwhile, small businesses have been left without any additional support with energy costs. We know of the increased percentage of business insolvencies last year in England and Wales. I fear that we will see a further escalation in insolvencies this year, unless the UK Government expand the energy bills discount scheme or at least require energy companies to allow small businesses to renegotiate their contracts early in order to reflect falling prices.

I mentioned that 74% of properties in my constituency of Ceredigion are not connected to the mains gas grid. Much has been made of the plight of households and rightly so, but for off-grid businesses, the situation is quite acute. They have been offered only a one-off payment of £150. We do not need to be experts in business to know that that falls woefully short of reflecting the increase in energy prices that these off-grid businesses have experienced over the past 18 months to two years.

Let us remember that these off-grid businesses are local post offices, village shops, swimming pools, and rural factories in Ceredigion—key pillars of rural society and economy, and the lack of meaningful support has placed them at a competitive disadvantage to those companies connected to the mains gas grid. When we consider that most off-grid businesses are located in rural areas, that failure surely flies in the face of the UK Government’s professed levelling-up agenda.

Of course, part of the long-term solution to bringing down energy bills for both households and businesses is to improve the energy efficiency of our buildings. I have previously called for the £6 billion committed to energy efficiency in the autumn statement last year to be brought forward in the term of this Parliament, but it is critical that the current energy company obligation schemes—the ECO schemes—are delivered properly.

E.ON Energy estimates that as of December 2022, only 11% of the ECO4 scheme obligation had been delivered, compared with an expected delivery rate of some 19%. By comparison, at the same point during the ECO3 scheme, it estimated that 29% of the obligation had been delivered.

The company has suggested that inflation is partly to blame for this underperformance, having escalated costs beyond the funding assumptions originally set for the installations. But it is also important to note that the scoring limitations of the scheme have set the bar far too high for the minimum improvements required for a property to be eligible for support under the scheme. The result is that many eligible households fail to secure an installer willing to undertake work on their properties. This is something the Government need to review with some urgency.

I now want to take a step back from the immediate issues facing households and society more broadly, and look at the longer-term problems. I echo many of the points that the hon. Member for Carmarthen East and Dinefwr made in his very eloquent speech. I agree that this Budget wasted an opportunity to tackle some of these longer-term productivity issues that have hampered prosperity in Wales for decades. I am concerned that businesses in Wales, particularly in rural areas, risk being left behind due to poor digital connectivity. For example, gigabit connectivity in Wales stands at some 50% compared to the UK average of 68%, and—as always—the problem is far more acute in rural areas, with only 27% of Ceredigion connected to gigabit internet.

We cannot allow rural areas to miss out on productivity-boosting technologies, whether that means simple broadband connectivity or the integration of new AI technologies. I therefore urge the UK Government to release the funding allocated to Project Gigabit without delay and in accordance with recommendations set out in the report of the Select Committee on Digital, Culture, Media and Sport. In addition, the Government should consider accelerating the timescales for the roll-out of gigabit broadband in very hard-to-reach areas, which often lack both fast broadband and a 4G signal. Sadly, many are located in my constituency of Ceredigion, and I know that the Minister is deeply aware of the impact of such notspots on the people living there.

The National Infrastructure Commission for Wales estimated that it would cost about £1.3 billion to connect every property in Wales with fibre-to-the-home technology, yet the Government have only released £1.2 billion of Project Gigabit funding so far for the entire UK. There is a real opportunity to boost productivity in all parts of the United Kingdom, if only the Government were willing to bring forward some of the funding that they have already allocated for this purpose. If fibre-to-the-home technology is too challenging in the short term, let us instead see greater effort made to expand projects designed to target very hard-to-reach areas, such as the rural small cell projects or work on gigabit-capable, fixed wireless access technology.

There must also be a way to reform the self-defeating systems that currently see fibre taken to the curtilage of some rural properties only for residents to be forced to pay exorbitant excess construction charges if they want that connection extended to their actual home—in other words, if they actually want it to work. In rural areas, where the curtilage of a property may lie some distance from the house, this is proving a real barrier to improved connectivity.

Another key area that should be prioritised if we are to boost the Welsh economy is, of course, renewable energy. Others are far more informed than I am on this topic and could make contributions, so I will just say that we have considerable generation potential along the Welsh coastline in both marine renewables and offshore wind, and an opportunity to seize a first-mover advantage in technologies such as offshore floating wind and become a world leader in the manufacture of components, and in the export of skills and expertise into a growing global market.

[Liz Saville Roberts]

There is a risk that we keep repeating ourselves, but there is a reason for us to do so. In Scotland, the Crown Estate 12 miles out to sea is devolved to Scotland, so that policy can be made in relation to it and the profits that arise from the Crown Estate remain in Scotland. Why, if it is good enough for Scotland, is it not good enough for Wales?

[Ben Lake]

I am grateful to my right hon. Friend for posing that question. It is indeed a question that keeps me up at night. Why is it good enough for Scotland but not good enough for Wales? Perhaps the Minister will address that point when he winds up.

The Welsh Affairs Committee recently published a report setting out that offshore floating wind technology could represent the single biggest investment opportunity in Wales for decades, and recommended that the UK Government take the necessary steps to ensure that its potential is realised. I very much hope that they do.

Wales desperately needs an economic strategy capable of providing adequate funding for its public services, reducing poverty, improving incomes and ensuring that we realise our potential contribution to the global effort of tackling climate change—a strategy that, I am afraid to say, the spring Budget did not deliver.

Support for the Welsh Economy and Funding for the Devolved Institutions

Debate between Ben Lake and Liz Saville Roberts

Tuesday 5th July 2022 Commons Chamber

[Ben Lake (Ceredigion) (PC)]

It is a pleasure, as always, to follow the hon. Member for Clwyd South (Simon Baynes), and I join him and the hon. Member for Cynon Valley (Beth Winter) in thanking the staff of the Welsh Affairs Committee. A number of Committee members are present this afternoon, and we benefit from their hard work and diligence in preparing what I would argue is an impressive range of inquiries. We punch above our weight—very much like Wales, perhaps.

I congratulate and thank the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) for securing this debate and for leading the Welsh Affairs Committee in the way that he does. His contribution, and those of my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards) and the hon. Member for Aberconwy (Robin Millar), have already caused us to discuss the structural long-term problems that Wales and its economy are facing, and the demographic consequences of those structural problems. Mention has already been made about recent census results in which Ceredigion reported a 5.8% fall in its population. I do not intend to pursue that line of inquiry in my remarks this afternoon, but it is an important area for us to consider and debate in future, because it is intertwined with the debate about levelling up and building a more prosperous economy, and indeed society. In many rural areas, and particularly areas such as Ceredigion, we are seeing a demographic trap in which some of our biggest and most valuable exports are our young people and skills. Yes, that has been happening for many years, but sadly the trend has been accelerating in recent decades. We need to get a handle on that.

I want to focus my remarks on the impact of the recent cost of living crisis on both households and businesses. Set against that backdrop, the debate is timely. As right hon. and hon. Members will be well aware, our constituents, whether households, businesses or community groups, are struggling under the weight of increased fuel and energy costs in particular. In anticipating some of the Secretary of State’s arguments and comments in summing up, I acknowledge that there has been a package of measures and support from the UK Government. As the Library’s briefing informs us, it amounts to some £37 billion and includes: £400 to help all households with energy bills; £650 for households receiving means-tested benefits, with an additional £300 for pensioners and £150 for people receiving disability payments; and a further £150 council tax rebate for households in council tax bands A to D.

[Liz Saville Roberts]

My hon. Friend is making an excellent speech. On that £400 household grant, does he share my concern that the residences of farmers count as businesses and therefore do not qualify? That is significant for us in Wales and would make a difference to an awful lot of people in rural areas.

[Ben Lake]

I am grateful to my right hon. Friend for raising that important point. Indeed, a number of hon. Members are concerned about that. There is still a lack of clarity arising from the technical consultation on the energy bills support scheme about whether farms—I am told that most of them will have a commercial electricity contract that also includes their household premises—will be able to receive that £400. It is important for the Government to look at that now before introducing the scheme in the coming months. She is right that it would not be appropriate or fair if farmers—many hon. Members in their places represent a great number of them—lost out due to a technicality. I am certain that the Government intend to support those individuals and households; it is just that the technical eligibility criteria need to be put right.

One thing that the useful House of Commons Library briefing tells us is that, despite that rather impressive package of measures, once we take into account changes to income tax and national insurance contributions, some of that support is offset, at least in net cost to the Treasury. If we were to take tax increases into account, net Government support stands at about £14 billion in the fiscal year 2022-23.

We need to consider whether the package of support is sufficient, given that we know that domestic gas prices increased by 95% between May 2021 and May 2022 and that domestic electricity prices rose by 54%. In nominal monetary terms, the April price cap saw an increase in the maximum for average bills from £1,277 a year to £1,971 and, in May, the chief executive of Ofgem mentioned that he expected the price cap to rise by potentially 40% in the autumn to a maximum of £2,800. That would be a doubling in less than 18 months, and that is why it is important that we consider the sufficiency of the measures already announced. Just after April’s price cap came in, the Welsh Government estimated that 45% of households in Wales could fall into real fuel poverty—and, of course, that does not take into account further increases that may come in the autumn.

As MPs representing rural areas know, the energy price cap offers solace only to households on the mains gas grid. Many off-grid properties have not been offered the same level of price protection and have been exposed to significant price increases in terms of heating oil and liquefied petroleum gas. It is particularly true in Ceredigion, I am sad to say. According to the Mid Wales Energy Strategy, as many as 72% of properties in Ceredigion are off the mains gas grid. I am sad to say that we have the accolade of being the constituency most dependent on heating oil of any in the UK Parliament. On average, the price of heating oil has risen by 150% in the last year. In some circumstances, the increases have been significantly higher.

There is a debate we need to have, perhaps not for today, on whether we need to change approach in how we tackle the price hikes. Are we certain that they are just one-off temporary increases? Some suggest that we have underestimated and under-costed the risks, and that some increases are here to stay. Indeed, we could see further price increases. I note just today turbulence in Norway that might cause a further increase in the price of wholesale gas. There are a lot of uncertainties at a time when wholesale prices are already at an elevated level.

Before drawing to a close, I should mention that we need to do more to support small businesses and community groups facing energy and fuel price increases. I have been speaking to many hospitality businesses in Ceredigion. One told me that its energy bills have increased by 450% and to such an extent that it had to really consider whether it could continue to operate. The situation is not unique to that business. I know a great number of many other businesses that are struggling in a similar manner. We cannot allow otherwise valuable and successful businesses to fall foul of the price hikes. I sincerely believe that the situation warrants further Government intervention.

To add to that, because I do not want to portray this as solely an economic problem, there is also a community or social impact of the current crisis. We will all have heard from community groups, halls and swimming pools—you name it—that are struggling at the moment with higher than average energy bills. We are currently in the summer months, so usage is a lot lower than it will be in the winter. If they are struggling now, I dread to think where they will be in autumn. For example, in my own constituency, Calon Tysul, a community-run swimming pool in Llandysul in the Teifi valley, is already spending about £1,500 a week just to heat the swimming pool. That does not include the dry side of its facilities. That is already forcing it to make very difficult decisions about the provision of swimming lessons for our young people.

UK Emissions Trading Scheme: Wales

Debate between Ben Lake and Liz Saville Roberts

Tuesday 13th July 2021 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

I beg to move,

That this House has considered the operation of the UK Emissions Trading Scheme in Wales.

It is a pleasure to serve under your chairmanship, Sir Edward. I commend the co-operative approach taken by the UK and devolved Governments in establishing the emissions trading scheme and in agreeing a common framework that treats each nation as an equal partner in our climate efforts. The scheme has brought coherence to one element of our combined efforts to achieve net zero.

There is, of course, room for improvement. I draw the Minister’s attention to concerns expressed by the Green Finance Observatory:

“The elephant in the room is that offsets are fundamentally not about mitigating climate change, or even about removing past emissions, but about enabling future emissions, about protecting economic growth and corporate profits.”

I hope that the Minister will reflect on those remarks when she sums up the debate. They raise two critical questions. First, how will businesses fundamentally reduce aggregate emissions, and do so rapidly? Secondly, what is the role of Government in facilitating that change?

In order to meet our climate targets, we must not only reduce overall emissions but adopt carbon-negative strategies. The most economical and natural of those is tree planting. I hope to expand on that point today and in doing so make a case for more closely linking the UK emissions trading scheme with a separate and voluntary carbon offset market. Both schemes encourage businesses to reduce overall emissions. They are currently unconnected in policy; they run parallel to each other. I accept the technical and policy challenges associated with directly incorporating carbon offsetting into the UK ETS, but I believe that an association between the two schemes, if established, would bring rigour, scrutiny and additional resources to the offsetting process.

Governmental intervention is urgently required to bring much-needed stability to the voluntary carbon offset market in Wales. My hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards) recently highlighted that large companies are already purchasing vast tracts of agricultural land in the upper Teifi and Tywi valleys for forestry and carbon offsetting and are doing so in a manner that internalises financial gain and externalises the social, economic and cultural costs.

Those costs increasingly pose an existential challenge to Welsh farmers and rural communities and are inimical to efficient land use and a just transition. To echo the National Farmers Union, we urgently need to ensure a system that makes carbon offsetting mean the right tree in the right place. The Government, by acting as a broker and data-backed co-ordinator, can help to ensure appropriate land use for carbon offsetting, support the sufficient scale of planting and empower local farmers and rural communities to make a carbon-negative effort for themselves.

Wales’s forests are a natural economic and national asset at the very heart of our decarbonisation efforts. The lungs of our nation, our forests sequester approximately 1.84 million tonnes of carbon dioxide equivalent annually, while pollution removal by woodland was estimated to have an ecosystem value of more than £385 million back in 2015. Our forests are also essential for our environment and biodiversity. Indeed, of the 542 listed species of principal importance to the Welsh Government, 210 rely wholly or partly on woodland habitats.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

Will my hon. Friend acknowledge the crucial importance of restoring Wales’s peatlands, given that their climate change mitigation potential is 3,000 tonnes of carbon a year, equivalent to 5% of Wales’s transport carbon emissions? I am sure he will also take the opportunity to welcome the peat restoration projects led by parc cenedlaethol Eryri, the Snowdonia national park.

[Ben Lake]

I thank my right hon. Friend for that intervention and, indeed, will join her in congratulating the parc cenedlaethol on that work. Peatland restoration will be an incredibly important part of our carbon mitigation and sequestration efforts. More work to ensure that local actors such as the parc cenedlaethol can fully benefit from and engage in that process is what we as politicians and policy makers should focus on in the future.

The area of land covered by trees and woodland in Wales has tripled since the early 20th century, increasing from 88,000 hectares in 1905 to more than 309,000 hectares as of March 2020. It accounts for about 14.9% of the Welsh land area. That is significantly greater in percentage terms than in England or Northern Ireland, but the coverage lags behind our Scottish cousins and is lower than both European Union and wider European averages, so we have much further to go.

The “Woodlands for Wales” strategy suggests increasing tree planting to at least 2,000 hectares per year from 2020. The Climate Change Committee, recognising the challenge of reaching net zero, has been even more ambitious, recommending an increase to woodland cover in Wales from present levels to 24%. That would mean planting 43,000 hectares of new trees by 2030 and 180,000 hectares by 2050.

Set against that backdrop, Welsh farming finds itself at a perilous juncture, buffeted on the one hand by increased trade barriers with our largest market and uncertainty over future income support, and on the other by increasing pressure on land use. Welsh land, like all land, is of course a finite resource. If climate goals are to be met in a sustainable and fair manner, solutions cannot be imposed on rural communities. Instead, solutions can and should be implemented in conjunction with rural communities, and in a way that protects them from any damaging consequences. That is especially important when it comes to Welsh forestry and carbon sequestration. If we are to achieve the desired objective of reducing carbon emissions and promoting biodiversity, rural communities must be at the heart of implementation. Welsh farmers play a vital but often overlooked role in the climate equation, with over 109,000 hectares of woodland—just over a third of the total woodland in Wales—located on Welsh farms. To fulfil the stated tree-planting objectives, therefore, we need to understand the implications for the farming and food and drinks sectors, which rely on this agricultural land—land that is also essential to the wellbeing of the rural economy.

At scale, concerns about food security are increasingly valid. We must also account for the real risk of displacing food production elsewhere, to countries that may have higher carbon footprints and lower environmental standards. The last thing that any of us would want is for an unregulated carbon offset market to bring about the perverse scenario of productive agricultural land in Wales being sold to large corporations for the purposes of carbon offsetting while we increase our food imports from across the world. Such a scenario—namely, the offshoring of our food production—would make a mockery of wider sustainability efforts. I must warn the Government that there are anecdotal examples of such a scenario beginning to take root in some parts of Wales. We must therefore act now to ensure that it does not become widespread.

The best way forward would be to increase the support for farmers and rural communities looking to enter the carbon offsetting market for themselves. I pay tribute to the fantastic work by academics based at Bangor University. In particular, I thank Professor John Healey, Dr Prysor Williams, Dr Sophie Wynne-Jones, Dr Tim Pagella and Ashley Hardaker for their outstanding research, which I commend to the Minister. If she were to review their work, she would note that substantial barriers to entry still exist for farmers and local landowners hoping to diversify into agroforestry. The UK ETS could play a transformative role, not only by better regulating the offset market but by providing the resources to encourage tree planting that is locally grounded rather than purchased by external, big business actors.

Practically, ETS revenues could be used to hasten a system of payments, as has happened in Ireland, so that farmers can afford to wait for a crop of trees to mature in order to derive an income stream. We could also look at land tenure restrictions and review contractual clauses that prohibit the planting of trees, which are especially important because over 30% of Welsh landed is tenanted.

Although such measures may seem parochial, they are fundamental to ensuring that we actually deliver a transition that is just as well as sustainable. We must work with farmers, who manage over 80% of land in Wales, to deliver a forested future that is critical to the overall success of our decarbonisation efforts. The alternative, in which big business can buy land, plant trees without any reference to local biodiversity and the optimum use of different parcels of land, all the while continuing with their polluting, business-as-usual practices, is unacceptable. Greenwashing, as the Minister will know, is an ever-present danger, but in this instance it would devastate Wales’s rural communities, culture and economy.

I hope that the Minister will address concerns that the ETS is not moving fast enough nor fundamentally reducing emissions. I also hope that she will agree that local groups and farmers should be supported to play an important part in the carbon offset market and in so doing lead the transition to net zero. We must not allow large corporations to buy farms, put rural communities out of home and land, and weaken local food production for the sake of greenwashed business as usual. More specifically, I would welcome any thoughts that the Minister might have on integrating carbon offsetting into the wider UK ETS framework to ensure that we have effective regulation of the market, the promotion of sustainable practices and the rewarding of responsible practitioners.

I hope that today’s debate, short as it is, has demonstrated the need for co-operative action across the UK to ensure that our greener future is ecologically, socially and culturally sustainable and, therefore, that the transition to it is a just one.

Electricity Generation: Local Suppliers

Debate between Ben Lake and Liz Saville Roberts

Wednesday 14th October 2020 Commons Chamber

[Ben Lake (Ceredigion) (PC)]

I am grateful for the opportunity to open this Adjournment debate on an issue that I know is of great importance to not only communities in Ceredigion, but, as is evidenced by the attendance of hon. Members in the Chamber this evening, communities across these islands.

We face many pressing challenges as a society: the health and economic consequences of the covid-19 pandemic have been debated today, but just as pressing are the devastating impacts of climate change. If we are to meet these challenges and, ultimately, emerge stronger, more secure and more prosperous, it is vital that we transition rapidly to a society powered by energy generated from renewable sources. The Committee on Climate Change has been clear that the UK is off track to achieve our commitment to net-zero greenhouse gas emissions and meet our obligations under the Paris climate agreement. At present, renewable electricity generation accounts for only 11% of all UK energy use, and our transport and heating networks need to be electrified to decarbonise our economy. If we were successful in doing this, new policies and regulations would be needed to ensure that the resulting rise in electricity demand was met by renewable generation.

There is good news: villages, towns and cities across the land possess incredible potential for community renewable energy projects, such as solar arrays in fields, wind turbines, and hydro units in rivers. Such schemes support local skilled jobs and offer local economic opportunities.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

Does my hon. Friend agree that to fully realise our local energy-generating potential we must invest in grid-integrated, locally situated batteries? They will smooth out the problems that hamper the grid supply in so many of our rural communities.

[Ben Lake]

I am grateful to my right hon. Friend for making that point. She anticipates a few of the arguments I wish to make this evening, but she is right to emphasise the role that batteries and improving storage will play in the future. If we are to balance local generation and local demand, being able to store a lot of this renewable energy will be key. These local, community-owned renewable energy projects support local skilled jobs and offer local economic opportunities, which will be very welcome in the face of the covid-19 pandemic’s impact on so many of our communities.