Draft Electricity and Gas (Energy Company Obligation) (amendment) Order 2017

Debate between Jesse Norman and Michael Fabricant

Wednesday 22nd March 2017 General Committees

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Jesse Norman)]

I beg to move,

That the Committee has considered the draft Electricity and Gas (Energy Company Obligation) (Amendment) Order 2017.

It is a pleasure to serve under your chairmanship, Mr Hanson, especially since you are not Geraint Davies, whose name I see on the form. In addition to thanking you, I thank all colleagues who have come at this early hour to assist us with this piece of legislation.

[Michael Fabricant (Lichfield) (Con)]

We are keen.

[Jesse Norman]

Especially my hon. Friend, who is—

[Jesse Norman]

If other Members wish to proclaim themselves keen as well, I welcome that.

In the Prime Minister’s first speech of her term in office, she acknowledged the hardships faced by poorer households in Britain—those hard-working families who, in her words

“can just about manage but worry about the costs of living”.

As part of the response to that dilemma, the Government are committed to helping households in fuel poverty or on lower incomes and those living in homes that are expensive to heat. The order is designed to move us further towards that goal.

[Michael Fabricant]

Regarding the cost of living and the cost of heating people’s homes, I have one question, having briefly looked through the explanatory notes. I wonder whether these tighter regulations, while perhaps helping to save the planet, might increase the cost of installation or operation. Has the Department made any analysis of the effect that the order will have on installation?

[Jesse Norman]

I am very grateful to my hon. Friend for that intervention, and I congratulate him on making it when my remarks have barely started, such is his eagerness. The Department of course scrutinises the cost of legislation, and the order is designed to allow a transition period precisely to set the suppliers up for the next supplier obligation, which will be introduced in 2018. That should allow time for any costs associated with the changes to be absorbed within the system.

The order will also make an important contribution to the Government’s clean growth plan and to reducing carbon emissions. We are making amendments to the existing Electricity and Gas (Energy Company Obligation) Order 2014, which covers the period from 1 April 2015 to 31 March 2017. The amendments extend the current scheme from 1 April 2017 to 30 September 2018 to enable reforms to be introduced while also allowing the industry time before further improvements are made through a new longer term scheme that will run from 2018 to 2022. Planning ahead to 2022—beyond the life of this Parliament—reflects announcements on funding made in the 2015 spending review. The longer term confirmation of funding is designed to give greater certainty to energy suppliers, installers, local authorities and other energy stakeholders.

The Government are facing up to the enormous energy challenges our country faces over the coming years. With the overhaul of the electricity market and continued investment in renewable technologies, we are making good progress towards ensuring that the UK’s energy is secure, low carbon and affordable. Improving the energy efficiency of the UK’s homes is central to that challenge and to reducing fuel poverty. The energy company obligation scheme helps occupants to keep warm, reduce their energy bills and protect their health and wellbeing by requiring energy suppliers to reduce carbon emissions and energy costs through installing energy efficiency measures in households across Great Britain. The supply chains involved in that endeavour also provide economic benefits across the country.

Since the introduction of the ECO in 2013, the scheme has proved to be a remarkably reliable and cost-effective means of upgrading our housing stock. Altogether, more than 2 million energy efficiency measures had been installed in more than 1.6 million homes by the end of December 2016, with around 1.2 million of those measures going to 900,000 low income and vulnerable households and households in deprived areas. That is a significant investment in addressing energy efficiency and fuel poverty. Thanks to the amendment order we are introducing today, we forecast more than half a million more insulation measures and around 45,000 more heating measures will be delivered through the ECO by 2018.

Oral Answers to Questions

Debate between Jesse Norman and Michael Fabricant

Tuesday 14th March 2017 Commons Chamber

[Jesse Norman]

I am unsure whether I entirely caught the hon. Gentleman’s remarks, but the Government have been clear in their support not just for the UK continental shelf and the companies on it, but for Aberdeen through the £250 million city deal.

[Michael Fabricant (Lichfield) (Con)]

22. Is my hon. Friend aware that at this very moment crude is trading at just $48.31? Has he read the OECD report which states that and many other structural factors mean that an independent Scotland would have a worse debt to population ratio than even Greece?

[Jesse Norman]

I am sure that my hon. Friend will understand that I will not comment on that specific economic issue. However, I admire his awareness of the oil spot price. The Government have managed to engineer a significant fall in oil and gas supply costs on the continental shelf—[Interruption.]

Oral Answers to Questions

Debate between Jesse Norman and Michael Fabricant

Tuesday 31st January 2017 Commons Chamber

[Mr Speaker]

Marvellous.

[Michael Fabricant (Lichfield) (Con)]

The Minister is quite right to say that he will analyse this in the round, because while I think many of us will recognise the economic advantages, particularly over a long period such as 100 to 150 years, the environmental impact will be considerable. Can he perhaps amplify what sort of things he will be looking at, including how tidal lagoons affect fish life, marine life and bird life?

[Jesse Norman]

It is of course true that, as well as the economic case and value for money issues that that raises, there will be wider consideration of environmental impacts, but in relation not just to individual schemes as they can be understood now, but to the way in which they might concatenate across a programme of tidal lagoons.