Energy Bill [HL]

Lord Bruce of Bennachie Excerpts

Committee stage
Monday 16th January 2023 Grand Committee

Moved by

[Lord Bruce of Bennachie (LD)]

234: After Clause 237, insert the following new Clause—
“Energy Efficiency Commission(1) Within six months of the date on which this Act is passed the Secretary of State must establish an Energy Efficiency Commission.(2) The role of the Energy Efficiency Commission is to advise on targets and timetables for effective ways of using energy more efficiently and conserving energy across—(a) generators,(b) industry,(c) commercial developers and real estate managers,(d) households,(e) transport agencies, and(f) any other relevant sectors,to ensure minimal wastage of energy, improved conservation and best practice towards achieving net zero.(3) The Energy Efficiency Commission must also advise the Secretary of State on targets set in relation to energy storage.”Member's explanatory statement
This amendment would seek to establish an Energy Efficiency Commission to advise on targets and timetables for effective ways of using energy more efficiently.

[Lord Bruce of Bennachie (LD)]

My Lords, I rise to move Amendment 234 in my name. We are at the end of this Committee stage, but this could in a way have been taken at the beginning. We have had an interesting debate over the last few hours with contradictory views about different forms of generation. However, we should all agree that the best possible outcome is to use whatever energy we generate much more efficiently than we do.

My amendment basically suggests that we need a dedicated commission to test all the possible ways of using energy more efficiently, to ensure that—although we have achieved quite a lot—we achieve a great deal more. That will help us to get to net zero an awful lot quicker. That is the essence of this amendment.

There is quite a lot of evidence that investing in energy efficiency delivers returns three or four times greater than investing in energy generation. Of course, in the present climate, when energy costs are very high, people will themselves be taking steps to use energy more efficiently because they have to—although, for some people, the only way they can use it more efficiently is by not using it at all, which leads to considerable hardship.

It is possible to accelerate energy efficiency in a whole variety of ways, and I accept that the Government have promoted quite a lot of them. I also accept that the Secretary of State is perfectly capable of interesting new policies, but unless we have a dedicated commission, I do not think that all the possible permutations will be explored quickly or thoroughly enough to deliver the results.

It has been estimated that simply raising the quality of home insulation in the UK could deliver £10 billion to £20 billion of benefit a year. Energy conservation has been called the fifth fuel—after coal, hydrocarbons, nuclear and renewables. It is interesting that the Energy Saving Trust has identified that:

“Retrofitting homes to an Energy Performance Certificate standard of ‘C’ would save as much energy as six times the forecast output for the Hinkley Point C power station.”


That raises the whole question of why we are building the power station rather than investing in energy conservation. I really believe we can do a lot more, and remarkably quickly. It also creates a whole economic activity: it creates employment.

We have discussed these issues in the past, and policies have been introduced. I seem to remember that, when he was Environment Secretary, the noble Lord, Lord Prescott, as he now is—then John Prescott—suggested that every new house should have solar generation capacity installed on its roof. That did not seem to happen. We have seen examples of passive planning to ensure that houses are built and designed to get the maximum benefit from the environment. Again, it happens here and there but it is not a policy overall. We have discussed district heating systems and domestic combined heat and power, which has always been around the corner but never actually delivered.

As an aside, there is clearly potential for heat pumps, but they do not suit every situation. In Scotland, the Green Party has persuaded the Scottish Government to basically ban the installation of any new oil-fired boilers after 2025. I think they will find that very difficult to enforce. For many people in my part of Scotland, Aberdeenshire—the highlands—who are off the gas grid, the alternatives just do not exist yet, and they are not likely to exist in 2025. Most of those houses are reliant on oil and many are old and hard to heat. I had a conversation with my local plumber who said that he had installed a number of heat pumps in and around the village, but in the last 12 months he had been asked to take quite a few of them out because they did not deliver the ambient heat that was required, and people found that they were having to pay for additional heating to supplement the heat pumps.

Clearly, we have to identify the properties that can benefit from insulation and heat pumps and assist them to get there as fast as they possibly can. At the moment—I guess in the short run the Government have no option—billions of pounds are being spent simply enabling people to get a contribution from the Government towards paying their bills, but over any length of time that money would surely be much better invested in increasing the efficiency of those homes so that they are more affordable.

I suggest that a commission makes sure it looks at the best practice nationally and internationally and tests all the options; is able to make very clear recommendations about priorities and what could be achieved, how quickly and at what cost; and suggests what mechanisms might be better—whether grants or loans. In some cases, just having access to advice and information would enable people to make their own decisions.

I must be honest: I have a concern about those who think that we can just turn off oil and gas now when we clearly have not developed the alternatives. People say that in transport, for example, we need to move to hydrogen, but the technology is not yet there. Even with electric cars, there are still enough problems with charging units, batteries and so forth that there is a question of whether we can get there as fast as we want. We have to find ways of doing it—I am not suggesting that we should not—but we cannot switch off what we have until we have developed the alternatives.

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[Lord Callanan (Con)]

I thank the noble Lord, Lord Bruce, for his amendments. I will take up the question from the noble Lord, Lord Teverson, first. The answer is absolutely; we have an extensive programme called the Energy Efficiency (Energy Using Products) Regulations. They are largely similar to those we had in the European Union, but we have extended them and taken them further. We have recent regulations on more efficient lighting and there are others coming, as well as some on the more popular white goods that people use. I would be happy to send him more details of that.

I move on to Amendment 234 from the noble Lord, Lord Bruce. The Government agree of course with the principle of having an independent body to advise on targets and timetables for energy efficiency policy and net-zero policy more broadly. But we already have that body: the Climate Change Committee fulfils that role. He will also be aware that the Government will announce further details about the energy efficiency task force that was announced by the Chancellor and the Business Secretary late last year. There is a lot of detailed work happening on that at the moment. We hope to have more to say very shortly.

On Amendment 235, the Government fully recognise the importance of energy storage and its ability to help us to use energy more flexibly and decarbonise our electricity system more cost-effectively. Our measure to define electricity storage provides long-term clarity and certainty over its treatment in regulatory frameworks. That will facilitate storage deployment going forward. At this stage, however, it is premature to set a target for the sector. We do not yet know the full extent of the system requirements for storage. Especially in the context of high energy bills and having to pay for increased storage, it would not be responsible to set storage target at this time, as we could set a target that is too high or too low and favour a more expensive technology over a relatively cheaper one. Instead, our approach is to remove barriers and spur innovation for all low-carbon flexibility technologies. We published the 2021 Smart Systems and Flexibility Plan with actions to facilitate the deployment of these technologies, including storage at all scales.

The Government are not in disagreement with the noble Lord, except on the narrow issue of targets. I hope he recognises our commitment to enabling the deployment of flexibility, including energy storage, across our energy system to even out fluctuations in generation and demand and therefore deliver the best outcomes, which we all want, for our consumers. Therefore, I hope that he will see fit to withdraw his amendment.

[Lord Bruce of Bennachie (LD)]

My Lords, I am grateful to the Minister for that response. As I said, I accept that the Government have been doing quite a lot, but I still believe they can do an awful lot more. I hope that those initiatives yield results.

On the noble Baroness’s intervention, I do not think it is a question of people not knowing how to install heat pumps; it is about people having expectations of heat pumps that do not suit every property. I speak from my own personal concerns. I have a house built in 1910; it is not the most efficient house. I inquired about a heat pump, and was told that if I was lucky I would get an ambient temperature of about 14 degrees, which would cost me about £10,000. I could get the ambient temperature up to 18 or 19 degrees as long as I spent £120,000 on increasing the insulation in the house. But other houses could be upgraded much more cheaply, so I suggest that they should be prioritised.

I am sorry, but I do not think the Scottish Greens are realistic about what they think can be achieved between now and 2025. In places such as Aberdeenshire and the Highlands, they will find a kickback when people are told that they cannot have an oil-fired boiler, there is no gas and we do not have a viable alternative for their property—yet.

[Baroness Worthington (CB)]

I am sorry; I was saying to myself that I would not do this, but I point out that when it comes to energy efficiency, electrification, which is a tried-and-tested way of providing heating to homes, is a fundamentally more efficient way of getting energy. The total primary energy demand of the UK could go down by one-third if we were to electrify our heating and transport, because of the lack of efficiency of anything that is combusted. The combustion inefficiency of engines and boilers cannot be fixed. Electricity is the best vector.

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[Lord Bruce of Bennachie (LD)]

The noble Baroness took the next sentence out of my mouth because the advice I was given for my house was to electrify it, but I cannot be guaranteed green, renewable electricity at the moment. For hard-to-heat houses, that is the way forward, but we have to ensure that we generate efficiently and economically, and deliver. I completely agree that that is exactly the result. We have got to get there as fast as possible, so I am on the same page. I just think that some people are being unrealistic in thinking we can choke off options before we have developed the alternatives. It is a question of how quickly we can get there. That was the purpose of my amendment.

I heard what the Minister said, and I urge him to keep moving and to do this as fast as he can. I beg leave to withdraw the amendment.

Amendment 234 withdrawn.