Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Mr Mike Weir (Angus) (SNP)
One of the best ways of achieving energy efficiency is replacing old and inefficient boilers. In Scotland the green homes cash-back scheme provides some help—albeit limited—with off-grid home fuel and liquefied petroleum gas boilers, but the ECO schemes of the main energy companies still do not cover those boilers. Will the Minister press the companies to reconsider?
Gregory Barker
I understand the hon. Gentleman’s point. We are keen to do even more for people living off the gas grid, particularly in rural areas. However, the hon. Gentleman failed to mention the significant payments that are available, through the new renewable heat incentive, to help such people manage the transition from expensive heating oil to new affordable technologies such as heat pumps.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
The hon. Lady raises a valid point. Frankly, successive Governments have failed to act sufficiently for park home residents. Although the measures that we have taken move the agenda on, we accept that there is more to do, and we want to do more to help park home residents. Providing better information and support is part of that strategy, and we are making more information available to residents. We are looking to see what further steps we can take to help to insulate the homes of park home residents.
Mr Mike Weir (Angus) (SNP)
One problem with energy in many park homes is that the supply is in the name of the operator of the site, who then sells on the energy to the tenants. One quirk of that is that under the warm home discount the name of the tenant must be on the bill, and it is not in these cases, so although these tenants would otherwise qualify, they do not in fact get the warm home discount. Will the Minister look at that and see whether there is a way around that anomaly?
Gregory Barker
I fully accept the hon. Gentleman’s point. That has made it difficult for successive Governments to reach out and act effectively to help park home residents. We are determined to try to crack this, and we are looking carefully at exactly the point he makes.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir(10 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gregory Barker
I am afraid I cannot off the top of my head give the specific figure, but I will happily write to the hon. Gentleman with it and make it available to the rest of the House. I can tell hon. Members, however, that we are doing, and are determined to do, much better than the previous Labour Government.
Mr Mike Weir (Angus) (SNP)
One way to increase energy efficiency is to have modern boilers. The current affordable warrant schemes under the ECO, however, do not include home fuel oil or LPG boilers, discriminating against those in rural areas who are off the gas grid. The Minister has said that the coalition wants to do something for rural areas, so will he look again and ensure that, as he has promised before, all such schemes will be technologically neutral?
Gregory Barker
We take this issue very seriously. We are meeting suppliers again next month, and I can assure the hon. Gentleman that there will be progress. That has eluded Governments in the past, but we are determined to make progress.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir(10 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
I certainly commend not only Worcester Bosch but the work my hon. Friend does in his constituency with the public and the fuel-poor, and particularly in getting that information to them. Last month, my right hon. Friend the Secretary of State wrote to all Members of the House and asked them to share with their constituents a guide developed by our Department, in conjunction with charities such as Age UK and National Energy Action, which explains how householders can cut their energy bills and where they can go for help this winter. There is help on offer.
Mr Mike Weir (Angus) (SNP)
T7. This morning it has been reported that in looking at the costs of energy, the Government are considering changing the cost of transmission. Will they take the opportunity finally to get rid of the discriminatory locational system for transmission and distribution costs that raises prices in the north of Scotland?
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Mr Mike Weir (Angus) (SNP)
T7. Ministers have rightly made it clear that replacement boilers under the green deal and the ECO should be technologically neutral, yet the reality on the ground is that most of the big six energy companies will not include liquefied petroleum gas or oil boilers within the scheme, citing cost. Yet again, it seems that off-grid customers are being left out. Can Ministers do anything to put pressure on these companies to include such boilers within the schemes?
Gregory Barker
I understand the hon. Gentleman’s point. Obviously, it is a commercial decision for each company that operates within the green deal which technologies they are going to stock and offer to their customers. If customers are not satisfied, they should shop around. The great thing about the green deal is that it involves a plethora of choice; there are more than 1,000—I believe there are 1,250 or more—green deal installers now, so customers should shop around. We want to drive choice.
Prepayment Meters
Debate between Lord Barker of Battle and Mike WeirWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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The Minister of State, Department of Energy and Climate Change (Gregory Barker)
I congratulate the hon. Member for Angus (Mr Weir) on securing this debate on fuel poverty and the use of prepayment meters. He is an acknowledged champion in this place of the fuel-poor, and from my time on the Select Committee on Environmental Audit I know of his personal commitment and professional expertise. Whenever he speaks on the subject, we listen carefully and thoughtfully even if we do not always agree. I reassure him that the coalition Government are committed to helping hard-working families and consumers with the rising cost of living. We recognise that the rising cost of energy is currently one of the biggest worries for householders.
The modest fall in the number of households living in fuel poverty was confirmed in April. The latest figures show that in 2011, 4.5 million households in the UK were in fuel poverty. That was a slight decrease from 4.75 million in 2010, which saw the first fall in the number of fuel-poor since 2004. Throughout the last Parliament and for a couple of years before, there was an inexorable increase in the number of fuel-poor. Despite the modest falls, encouraging as they are, there is absolutely no room for complacency. The figure is still far too high and we are honest enough to realise that some of the problem is beyond the Government’s control. The steady growth in the number was driven primarily by increases in the wholesale price of gas. There is a direct correlation not between the sympathy that the Government of the day feel for the fuel-poor and the rhetoric they employ, but between the wholesale cost of gas and the price of energy that people must pay. We must do more to decouple that link and to cushion consumers from the international gas markets.
Mr Weir
I do not disagree with what the Minister has said so far. He is correct about what is driving rising fuel prices, but does that not make it imperative that the Government adopt the little things I suggested to ameliorate the situation? It is all very well talking about wholesale gas prices, but it is the people at the sharp end who are suffering them. My suggestions would not solve the problem, but they would ameliorate the situation for those vulnerable people.
Gregory Barker
The hon. Gentleman made several points that I hope to cover, but I want to set out the framework and the context in which we must operate. Of the 3.2 million fuel-poor households in England in 2011, around 20% paid for their electricity and 24% paid for their gas with prepayment meters. Many hon. Members and certainly members of the public will be surprised that the figure is so low, because there is often an assumption that “fuel-poor” and “prepayment meter” are synonymous. In fact, only a relatively small number of the fuel-poor—20%—are on prepayment meters. Prepayment meters enable customers to monitor and control their energy expenditure in a direct and immediate way and, as a last resort, they can be a valuable alternative to disconnection for non-payment of bills.
Where prepayment meters are installed to recover a debt, that element of a customer’s payment must be set at a level that takes into account their ability to pay. The hon. Gentleman rightly says that there must be an equitable balance in such situations between debt repayment and the real ongoing needs of a household to cook, to heat the home to a safe level and to light the premises, particularly where there are children, or elderly or vulnerable people. It is understandable that he seeks a cap for weekly payments. Customers in debt repay a fixed amount at fixed intervals—for example, weekly. The amount repaid is calculated for each customer based on their personal circumstances and their ability to pay. He asked what would happen if their circumstances changed. In those cases, customers should talk to their supplier about the change and how it may impact on their ability to repay debt.
I recognise that a percentage repayment, such as 20% of the amount spent, may feel fairer, and that fixed payments can be a blunt instrument, but there are two sides to the coin. There is a risk that setting a percentage limit may create a floor rather than a ceiling. It may encourage suppliers to use the limit as the automatic default position rather than, as they do now, individualised payment plans, which are surely in everyone’s interest.
The hon. Gentleman makes the valid point that in some cases customers may feel that they are set an inappropriately high debt recovery level. If that is the case, they need to speak to their supplier. If that does not satisfy them, they should speak to Ofgem or the energy saving advice service, which is run by the Government, for further advice on what to do.
Mr Weir
Does the Minister not accept that if Citizens Advice Scotland is coming across rates of 70%, where £7 in every £10 goes towards paying down the arrears, something is seriously wrong? It is not just one case; Citizens Advice Scotland cites several. That cannot be right.
Gregory Barker
I agree with the hon. Gentleman that it does not seem right, but I am not aware that it is the norm; it is the exception and if he is aware of such cases, I encourage him to take them up. I want to know more about the individual circumstances of the household and how the debt built up to such a level. We cannot have a situation where we ignore moral hazard and certain households do not feel an obligation to repay debt, because that penalises and is unfair to those on low incomes who struggle to pay their electricity and heating bills on time. We simply cannot give away heating when their next-door neighbours are struggling hard to do the right thing and pay the bills. There is a balance of fairness to be met.
Energy Bill
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
The hon. Gentleman asks a fascinating and timely question, one which deserves a proper answer. He may have misheard me, because when I said “global turnover” what I actually meant was UK turnover. Nevertheless, that is clearly a very significant amount.
Our approach would allow for a relatively straightforward resolution of relatively simple cases. Accepting amendments to remove the cap would require us to make changes to the appeal mechanism, which could deny consumers access to the timely compensation they are due, as it could result in a far lengthier resolution of cases if the stakes are much higher. In considering whether such a trade-off is justifiable, we should take into account just how unlikely it would be for consumers to lose out on this scale. Exceeding a 10% cap of annual turnover would mean penalties and compensation of over a £1 billion for the very largest domestic energy supplier. The largest penalty imposed to date by Ofgem has been £15 million and under our legislation the cap for the largest would be set at £1 billion. A cap on redress is therefore unlikely to hinder Ofgem’s ability to impose appropriate redress orders.
In addition, there are unintended consequences of removing the 10% cap on penalty and redress, as that could also increase the costs of capital and insurance premiums for energy companies. Again, that would particularly affect the smaller companies—the very ones we are trying to attract into the sector—with all the adverse impacts on consumer bills that I mentioned earlier.
Energy companies should be in no doubt, however, that these powers are designed to ensure that consumers receive appropriate compensation. The combined 10% cap on penalties and redress will apply to each separate regulatory breach. If companies flout the rules on a number of occasions, they will therefore face correspondingly larger payouts. For the reasons I have set out, I hope that hon. Members will, on balance, agree not to press their amendments to a Division.
Mr Weir
I find myself in the unusual position of agreeing with a lot of what those on both Front Benches have said. I have a lot of sympathy with the amendments and, unlike the Minister, I do not find any difficulties with amendments 2 and 5. If a company has been doing over consumers, whether it has been doing it the day before the Act comes into force or the day after does not seem to make any difference. If we are seriously considering making such companies pay such large sums for their misdemeanours, I would be happy to support those two amendments. That would send a clear message that we are fed up with some of the things that have been coming to light in recent years and with how the consumer has been mistreated, taken for granted and, frankly, milked, by some companies.
My hon. Friend the Member for Glasgow North West (John Robertson), if I may call him that, made very good points about turnover.
Gregory Barker
I am grateful to the hon. Gentleman for giving way, particularly as I have only just sat down. Let me be absolutely clear on this important point. For investigations by Ofgem that are already under way, Ofgem will continue to negotiate compensation on behalf of affected consumers. Companies that fail to negotiate and agree satisfactory redress can expect Ofgem to reflect that lack of co-operation in the penalty it sets.
Mr Weir
I accept that, and I understand what the Minister is saying, but he said in his speech that the maximum penalty to date had been £15 million. Under the Bill he is talking about £1 billion. There is a massive difference between the two and my point stands: if consumers have been ripped off, it does not matter whether it happened just before the new system was introduced or just after that. The same should apply, in my view, and I do not have any great problem with that proposal.
However, I have a big problem with amendments 3, 4, 6 and 7. As I said in an intervention on the hon. Member for Liverpool, Wavertree (Luciana Berger), I have a worry—the same sort of worry as the Minister—about the effect that the amendments would have on the company. It seems that one aspect of the Bill is about trying to get investment into the energy industry. For far too long there has been insufficient investment; a lot of modernisation and new investment is needed to get our energy system up to scratch. The figure is 10% of the turnover, whatever that turnover will be—I am still not clear what the word covers. That takes me back to the days when I served on the Select Committee on Energy and Climate Change with my hon. Friend the Member for Glasgow North West and we had the big six in one day and asked them about their profits. We asked whether they had made their profits selling to the consumer and they replied, “Oh no, we didn’t do that.” We asked whether they made them through generation, and heard, “Oh no, we didn’t make it from that.” We asked, “Where did you make those profits? You have large profits,” and no one could answer the question. There is great difficulty in pinning down what is meant by profit and turnover. In a time when we have six big energy companies, five of which are effectively multinational companies—we have seen in recent weeks what happens with the tax of multinational companies—we need a bit more clarity about what is meant by turnover.
Although the sums involved in 10% of turnover are significant, my bigger worry is that a company could be under investigation for an alleged breach for a considerable time. If there is a set limit, whether it is 10%, 20% or whatever, anyone thinking of lending that company money for infrastructure projects—most of them borrow from large financial institutions or other lenders—will know the contingent liability and what they are dealing with. I grant that if the liability is absolutely unlimited the sums involved are unlikely greatly to affect the big companies, given their size, but the uncertainty might well affect them. As we all know, those lending sums of money of such magnitude will consider the state of the company. A potential unlimited liability going into many billions of pounds, if there has been such an incident, could seriously undermine the company’s ability to borrow the money for much-needed infrastructure in our energy supply system.
I have a great deal of sympathy with those four amendments and understand what the hon. Member for Liverpool, Wavertree is trying to do, but I have a difficulty with them. Perhaps when she winds up she could expand on them and reassure me on the points I have made.
We must also remember that the provision would affect not only the big six energy companies but all regulated persons. If I understand correctly, that would include the small companies that are trying to get into the market. The Government say that they want to bring new entrants into the market, including the smaller companies that are beginning to nibble away at the edges of the big companies. If they were faced with such a penalty—let us hope that none of them would be—it would be the death knell for them.
Energy Generation
Debate between Lord Barker of Battle and Mike Weir(11 years, 7 months ago)
Westminster HallRead Full debate Read Hansard Text
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Gregory Barker
I am afraid that I will not give way, because I have very little time to cover all the points.
It is interesting that I do not think that I have heard anyone in this debate refer to consumers, to consumer bills or to the ability of the British taxpayer to shoulder the subsidies that are necessary to pay for this agenda. As hon. Members know, I am a great champion of greening our economy. I am one of the few Members present who played a part in the passage of the Climate Change Act 2008, which is one of the proudest moments of my parliamentary life to date. I am absolutely committed to that, but we have to reconcile the difficult challenge of cost and delivery.
The Prime Minister has been emphatic. I am glad that my hon. Friend the Member for St Ives mentioned that we are the greenest Government ever. That was the Prime Minister’s pledge when he visited the Department of Energy and Climate Change on day four of the Government, and he reiterated the pledge only a matter of weeks ago to the Royal Society:
“we are in a global race and the countries that succeed in that race, the economies…that will prosper are those that are the greenest and the most energy-efficient… it is the countries that prioritise green energy that will secure the biggest share of jobs and growth.”
There is no fundamental difference between the two sides of the House in our direction, destination or determination to meet the goals that are embedded in the Climate Change Act. In fact, there is not so much between us on the decarbonisation target, either. We have tabled an amendment to the Energy Bill that will allow us to set a decarbonisation target alongside the fifth carbon budget, and I will go on to address that in detail.
My hon. Friend the Member for St Ives mentioned marine energy in his opening speech. I am extremely proud of the huge leaps forward we have made on that exciting technology over the past three years with the establishment of the UK’s first marine energy parks—first in the south-west and now in Scotland. I am extremely proud of that investment. Our commitment in the last review, despite all the pressure on public finance and energy bills, was to increase substantially the renewable obligations certificates that we are giving marine, to give it the investment punch that it needs.
My hon. Friend kindly invited me to visit Cornwall and see FaBTest. I will be there next week. I must admit that it was already in the pipeline, but he can take back the good news this weekend and tell every Cornishman good and true that the Energy Minister is coming.
Gregory Barker
Quite right. I stand corrected. Although I am blowing my own trumpet, the hon. Member for Rutherglen and Hamilton West (Tom Greatrex) chided my Department for its turnover in Energy Ministers. Coming from the Labour party, that is a bit bleeding rich. Under the previous Administration, there was a revolving door on the Department. I think I am now the longest-serving Energy Minister since the previous Conservative Administration—
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir(11 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Mike Weir (Angus) (SNP)
One group that suffers most from fuel poverty is those on prepayment meters. Hon. Members have heard evidence from witnesses in the Energy Bill Committee that the Government’s proposals will make reductions to the lowest tariff only within the type of tariff people are already on. How will that help those on prepayment meters?
Gregory Barker
Those people should also see reductions; they certainly will not be stranded on previous deadweight tariffs.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
This is a significant issue. In Sussex I am one of those customers, and the cost of heating oil is staggering. My hon. Friend the Member for Wealden (Charles Hendry) did terrific work in this area when he was a Minister in the Department. Last year, he looked extensively into possible cartels and competition issues, and we continue to look very carefully into that. Again, I would happily meet my hon. Friend to explain exactly what we are doing.
Mr Mike Weir (Angus) (SNP)
The Minister only talked about on-grid electricity and gas in his original answer, but there are also serious off-grid disconnection problems. Sometimes they arise because people are unable to afford supplies, and sometimes there are involuntary disconnections because of difficulties in getting supplies through in bad weather. Has the Minister spoken to the major suppliers in this market to remind them of the difficulties faced by those on low incomes and to ensure there are no disconnections this winter?
Gregory Barker
I have not personally spoken to suppliers of heating oil because that is not part of my portfolio; it is part of the Energy Minister’s portfolio. As I have just said, however, the former Minister, the hon. Member for Wealden (Charles Hendry), was extremely forensic in taking this through, and his work continues in the Department.
Feed-in Tariffs Scheme
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
The growth prospects are very strong. There is now real visibility, not just for the next few months or until the next political review. Industry and investors alike can plan for the long term with real confidence, because there is no end date on the scheme. There is no sell-by date for the formula we have established; it is an enduring, long-term scheme—certainly much better than the appalling car crash of a scheme that we inherited from Labour. People can invest with certainty and the predictability of reasonable, sensible returns.
Mr Mike Weir (Angus) (SNP)
Everyone, including the industry, accepts that the cost of PV is coming down. The PV scheme has been one of the most successful at getting home owners involved in renewables. Does the Minister not think it is sending the wrong signal to choose the smallest domestic installations as the only ones where he has not gone for the highest possible tariff under his new options?
Gregory Barker
The hon. Gentleman should understand that I am not using consumers’ money—that is what it is: subsidy that comes directly from consumers and consumer bills—to send signals or to play politics. The tariff needs to reflect the genuine underlying costs of installing solar. That was totally missing from the scheme we inherited; it is now at the core of the new tariff framework. As a result of the particularly strong falls in the costs of smaller systems, we are able to set a tariff that accurately reflects, as far as we can, the return of around 6% that we think is sensible and makes it attractive for people with the right roof to install solar.
Energy Bill [Lords]
Debate between Lord Barker of Battle and Mike Weir(13 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gregory Barker
As this is defined as consumer finance, it will be the Office of Fair Trading, rather than the FSA, that will regulate this market. My hon. Friend makes a good point, however. It is our intention that there should be robust consumer protection, and we expect that the guidelines will be improved and refreshed to reflect the green deal. We will also expect the Office of Fair Trading to take a robust line from the very start, to ensure the integrity of the selling, and to ensure that any mis-selling is stamped out at the outset and full compensation is paid to any victims.
Mr Mike Weir (Angus) (SNP)
One of the problems with energy mis-selling was that it was a long time before many of the cases came to light. Does the Minister have any thoughts on ensuring that the standards that are to be imposed on those selling green energy are regularly inspected to ensure that any problems can be detected at an early stage, rather than finding a huge range of problems several years down the line, which is what happened following the doorstep mis-selling in the past?
Gregory Barker
I can assure the hon. Gentleman that we will keep all elements of the green deal under close review. We are embarking on a really new, large-scale proposition; there is nothing quite like it anywhere in the world. We are pioneering a new model for energy saving, at scale, and as a result we will need continually to monitor all aspects of it, especially those relating to selling and mis-selling. We will need to ensure that the legislation that we have put on the statute book, the codes of practice that underpin it and the secondary legislation that we will introduce in due course before the launch of the green deal remain pertinent. If we identify any areas in which we think improvements can be made, we will not hesitate to make them.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
I can assure my hon. Friend, who is an expert on these matters, that there will be the maximum possible ambition in the EMR documents that we will publish next week, but there is much more work to be done. We will need to consult the industry. Demand reduction is not like alternative forms of energy generation. We are creating a new model, and different types of indices and accounting will be necessary. We will need a robust system of measurement as well as the market mechanism. I have absolutely no doubt that we can crack it, and I can assure my hon. Friend of our ambition and determination to do so.
Mr Mike Weir (Angus) (SNP)
Last week I received my gas bill, which showed that my consumption had been 25% lower than it had been during the same period last year. At the same time, however, the direct debit payments requested by the company were rising substantially. How confident is the Minister that demand-led measures will help hard-pressed consumers?
Gregory Barker
I congratulate the hon. Gentleman on his heroic efforts to reduce consumption. He is right: the best way of ensuring less exposure to rising gas prices, oil prices and fossil fuel prices generally is to reduce consumption. The green deal—the most ambitious roll-out of home energy efficiency since the second world war—will be a massive bonus for all our homes, and we hope to have applied it to 26 million homes by 2030.
Energy Bill [Lords]
Debate between Lord Barker of Battle and Mike Weir
Mr Weir
I thank my hon. Friend, but again, I would refer to what the Secretary of State said. My hon. Friend may understand what the clause means, but from the answer I received earlier I am not sure the Secretary of State does. I want clarity about what is intended.
On the green deal, we welcome any moves to increase the number of homes with good energy efficiency and make use of domestic microgeneration, but we have some concerns about the Government’s approach. There is talk of amendments on warm homes, and we are generally sympathetic to what they are intended to achieve. However, I wish to mention a point made by the Federation of Master Builders in its briefing on the Bill. It quotes the Minister as saying that the Government’s aim is to have 14 million homes transformed by 2020, and states that that
“would require work to be completed at the rate of 1.5 million homes per annum which equates to almost 30,000 homes per week or put another way 4,274 homes per day!”
There is nothing wrong with such an ambitious target, but to achieve it we need to ensure that there is a veritable army of installers to take on the work.
I fear that, because of the way in which the green deal is being set up, it might be dominated by a few large companies, as my hon. Friend the Member for Na h-Eileanan an Iar (Mr MacNeil) said to the Secretary of State. The Minister may remember that I have previously raised with him the concerns of SELECT, which represents the Scottish electrotechnical industry, about the microgeneration certification scheme, which it feels works against small firms in several ways. It drew up an alternative scheme, which should be acceptable under the relevant EU directive and is consistent with the Scottish Government’s building standards system, but DECC would not agree to that system being put in place.
I understand that under the current scheme, it is difficult for firms to become certified. For them to qualify, the equipment that they install must be MCS-certified and installed by an MCS-certified installer. The difficulty for small firms, particularly those in rural and island areas of Scotland, is that many are unable to obtain certification because they cannot provide the required number of installations. Nobody is likely to want such installations unless they are certified. I fear that that problem will be transferred from the MCS to the green deal scheme if it is carried out by larger companies.
Gregory Barker
I am listening carefully to the hon. Gentleman, and I am aware of and responsive to his concerns, but which technology in particular is he talking about? The MCS covers a whole range of technologies, and some providers are perfectly happy with the scheme whereas others have specific problems.
Mr Weir
The Minister says that, but firms involved in a range of technologies have approached me. Scottish Renewables has raised problems with the scheme, and it covers all sorts of microgeneration technologies that will be important in providing renewables in future, particularly in remote rural and island areas. We hope that those technologies will be financed partly under the green deal. Unless the problem of not allowing small firms to install equipment is solved, smaller communities in rural areas may not get the benefits that could come from the green deal. They may not get the jobs that the Secretary of State talked about.
Gregory Barker
The MCS is quite outside the scope of this Second Reading debate, but I take the hon. Gentleman’s point entirely. I have had concerns about it myself, or at least about some parts of it, and I have been considering how we can improve it. If he would care to come to see me, I would be very happy to sit down and talk to him about it to see whether we can address his concerns in more detail.
Mr Weir
I thank the Minister very much for that offer, which takes two pages out of my speech. I will certainly take him up on that. It is an important point: although we support the aims behind the green deal, it must benefit all areas of the country and not just the B&Qs of this world—not that I have anything against B&Q.
I note with interest clauses 80 to 89, relating to offshore petroleum and gas and particularly to the difficulties of a common carrier arrangement. The Select Committee on Energy and Climate Change considered that matter back in 2009, when I was a member. We heard evidence on the issue, and it is fair to say, and hardly surprising, that there was a great deal of difference of opinion on the need for a common carrier arrangement for North sea infrastructure.
With specific reference to the future development of fields west of Shetland, which may or may not proceed given the Government’s tax grab, the Committee noted:
“We understand the Government’s argument for not wanting to interfere in a heavy-handed way in the establishment of a common carrier arrangement for oil and gas west of Shetland. But two things are clear: west of Shetland resources offer enormous potential—possibly a fifth of our remaining oil and gas resources; and putting in place a shared infrastructure to exploit those resources is expensive and complex. The Government should continue its dialogue with industry and agree a timescale for the establishment of such a shared infrastructure and the arrangements governing its use. If progress does not meet that timescale the Government should be prepared to take a more active role, probably through regulation but not precluding assistance with funding.”
The all-party group on the British offshore oil and gas industry recently heard from a representative of small companies working in the North sea, who talked about the difficulties that exist. The problem with the common carrier arrangement is that many of the fields in the North sea are now smaller fields that have been sold off by the majors and redeveloped by smaller companies. However, to bring the oil and gas ashore those companies need access to the infrastructure, which is generally owned by the majors. There are sometimes difficulties in gaining such access.
The group was told that there is a legal process known as a determination, whereby if negotiations on access to infrastructure fail, DECC can be called on to set terms and conditions and a tariff price. A determination has never been effectively used, and although DECC is making efforts to address that shortcoming, a determination is a backstop that comes too late in the process. Oil & Gas UK set up a voluntary agreement, but it says that it is difficult to get much of the information it requires, particularly on tariffs and previous commercial deals. It is therefore difficult for smaller operators to gain access to infrastructure.
The Bill continues the existing arrangements and does not address that difficulty. I recognise the difficulty of Government action, but such action is necessary to ensure that small companies that currently work fields that would otherwise not be worked can access that infrastructure. Currently, the Secretary of State can make a decision, but it is difficult to see how he could do so unilaterally without referral from one or other party.
On an allied matter, RenewableUK notes that the Crown Estate currently gives oil and gas developers leasing priority over offshore wind farm developers if supplies are found, with no compensation payable to the developer. It says that the existence of that measure leads to insecurity and uncertainty in development at a time when offshore wind is rapidly expanding. The Minister needs to consider that matter in more detail, although the obvious solution is to devolve the Crown Estates to Scotland and we will sort out our own solution.
That brings me to my final point, on offshore transmissions, which is allied to my shared infrastructure concerns. Ofgem makes the point in its briefing that
“the Bill contains provisions to facilitate the next stage of the enduring offshore regulatory regime, allowing wind farm generators to build network assets before transferring their ownership to the successful winner of the tender.”
However, how will the energy be brought onshore from those offshore wind farms? There is a lack of joined-up thinking on how offshore energy is fed into the national grid. To illustrate, there are three wind farms off the coast of my constituency. I have asked their developers how they intend to bring the energy to land, and each has its own proposal. We are in danger of running into public opposition to offshore wind farms not because of the wind farms themselves, but because of the on-land infrastructure needed to bring the energy ashore, especially if there are myriad onshore connections within a small distance of one another.
I have urged those developers to speak to one another about linking up offshore so that they can bring one cable on to land, but that does not seem to be happening. The Government need to look at that to ensure that we do not run into the difficulties with offshore wind that we ran into with onshore wind.
If the Minister gives me some assurance on those points, I might remain quite happy to recommend supporting the Bill to my hon. Friends. The Bill has many good measures in it, so the little clause on swapping bits of our continental shelf is odd. That gives us cause for concern, particularly given actions by previous Governments on the continental shelf that mean that I look out from my constituency on to an area of water that is English for fishing purposes.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir(13 years, 8 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gregory Barker
This is a DCLG lead, but there should be no doubt about our commitment to the transformation of the housing stock. We know that the Opposition are still addicted to targets, but the difference is that the Government are addicted to real progress and to transformational change. They can carry on creating new targets and we will get on with making real changes in real life.
Mr Mike Weir (Angus) (SNP)
9. What recent discussions he has had with ministerial colleagues on the construction of new nuclear power stations.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir(13 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gregory Barker
I would be happy to look into that case, but obviously, the energy supplier and not Ofgem, the regulator, is responsible for dishing out those payments, which should be made quarterly. If my hon. Friend is aware of longer delays in Colne Valley—he is a doughty champion for his constituents—I will be happy to look into those specific cases on his behalf.
Mr Mike Weir (Angus) (SNP)
Is the Minister aware of the concerns in Scotland that the take-up of domestic solar panels through the feed-in tariff has been hampered by the unsatisfactory nature of the microgeneration certification scheme? Will he or his officials meet installers’ representatives to discuss why the Department refuses even to engage with their proposals for a scheme to meet specific Scottish needs?
Gregory Barker
I am aware of considerable unease about the MCS, which was set up by the previous Government. A number of complaints have been made to the Department, and I take them extremely seriously. I would be happy to look at the issues that the hon. Gentleman raises.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Mr Mike Weir (Angus) (SNP)
In Scotland, some of the money for lending by the GIB will have been accumulated through the fossil fuel levy. This is money that came from Scottish consumers, and which the Secretary of State’s party promised to release unconditionally to the Scottish Government. Will the Minister press for the immediate release of the money to enable investment in renewable energy now, rather than waiting perhaps years for the setting up of the GIB?
Gregory Barker
There already is dialogue with the Scottish Government on this important issue. The way in which we administer those funds must ensure that they are used to help to drive forward green growth and green jobs.
Oral Answers to Questions
Debate between Lord Barker of Battle and Mike Weir
Gregory Barker
We can see the absolute merits of a super-grid, but we do not yet have a fully evolved policy. I am sure the hon. Gentleman will play a key role in helping that policy emerge.
Mr Mike Weir (Angus) (SNP)
14. What recent discussions he has had with his EU counterparts on carbon pricing; and if he will make a statement.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
The current carbon price is simply not providing a sufficient incentive for low-carbon UK investment. That is one of the reasons why we are pushing for the EU to increase its target for cutting emissions to a 30% reduction by 2020. My right hon. Friend the Secretary of State discussed that when he met our European counterparts at the Environment Council on 11 June.
Mr Weir
I thank the Minister for that answer, but is not the truth that the floor in the carbon price is a way of giving a hidden subsidy to new nuclear power stations? Given the difficulties that already exist in the emissions trading scheme with the free permits being given to heavy industry, how will he convince European partners to go along with the idea? If he cannot, is it the Government’s intention to introduce a carbon floor price in the UK alone?
Gregory Barker
My right hon. Friend the Chancellor of the Exchequer announced in the Budget that we would publish plans for a UK carbon floor price in the autumn. It is a key part of our plans for a transition to a low-carbon economy. We see that transition as an advantage and a competitive economic opportunity for the UK, but critical to that is providing a long-term strategic framework for industry to invest with confidence and certainty.