Energy Prices Bill

Lord Framlingham Excerpts

2nd reading
Wednesday 19th October 2022 Lords Chamber

[Lord Foster of Bath (LD)]

My Lords, on these Benches we too support the broad thrust of the Bill, but like the noble Lord, Lord Lennie, we wonder what it might look like by the time it gets to us in Committee just next Monday. We also share the concern of the Delegated Powers and Regulatory Reform Committee about the unfettered powers being given to the Secretary of State without any time constraint—powers that enable the Secretary of State to make large changes to the sector without consultation or the right to appeal. As others will no doubt point out, we are concerned that the measures in the Bill treat renewables such as wind and solar less favourably than oil and gas. However, I will concentrate on two issues not covered in the Bill which I believe should be.

The Long Title of the Bill is:

“A Bill to Make provision for controlling energy prices; to encourage the efficient use and supply of energy; and for other purposes connected to the energy crisis.”


So, in addition to pricing and supply, the Bill is also meant to be about the efficient use of energy, yet it is hardly mentioned. Unlike those in many other countries, it seems our Government have no strategic interest in encouraging anyone in the UK to save energy. The International Energy Agency describes energy efficiency in priority terms as the “first fuel”. It reckons that at least half of the improvements needed to deliver net zero by 2050 will come from greater energy efficiency. However, in the UK, far too many people cannot use energy efficiently: their homes leak heat because they are poorly insulated. Around 15 million homes are below energy performance certificate band C. In other words, 15 million homes are inadequately insulated, so they cost more to heat—on average, almost £800 a year. Yet in the absence of a clear national programme, home insulation work has plunged by 50% over the past year, leading Doug Parr of Greenpeace to say:

“It’s frankly astonishing that this dip in insulation rates comes at exactly the time we should be ramping up this proven, long-term solution to the cost of living crisis.”


Even the Conservative-inclined Sun newspaper said in August:

“Householders faced with astronomical heating costs need lagging for their homes, not a government lagging behind.”


So, measures to improve energy efficiency should be a top priority for the Government, with a clear strategy and evidence of real commitment.

As the Minister knows, I have spoken many times about the need to establish the Government’s own energy efficiency targets in law. I have argued that it is the retrofit industry that will deliver the Government’s energy efficiency targets, but the industry has lost confidence after being let down by numerous failed schemes. The industry has shrunk, and the amount of energy efficiency work has fallen dramatically. The industry itself argues that to persuade it now to invest in research, training and equipment, it needs the confidence that putting targets into legislation would give. Conservative Ministers, including the current Chancellor, have claimed numerous times to believe in doing just that—enshrining targets into law. A Defra document states:

“A legally binding long-term target gives a clear signal to industry of the direction of future government policy. This may increase investor confidence and encourage industry to invest in infrastructure and research that will drive innovation”.


The Government have two main targets: for all fuel-poor homes to be EPC band C by 2030; and for all remaining homes to be EPC band C by 2035. However, to date, the Government have refused to put those targets into law to make them legally binding as the industry has requested. I have received no credible explanation for this failure, so I will table an amendment to the Bill in Committee. Last night, your Lordships agreed an amendment to the Social Housing (Regulation) Bill which did at least put an energy efficiency target for social housing into legislation. I hope noble Lords will agree that all the Government’s energy efficiency targets should follow suit. I hope the Minister will explain in detail the Government’s plans in relation to energy efficiency and why it is absent from the Bill.

I now turn to another issue I recently raised which I believe should form part of the strategy to improve the supply of energy: the role that solar energy can play. Residential solar systems are already very popular, reducing bills and often being able to supply excess energy back to the grid at times when it is under pressure. I recently installed solar panels on my own home, adding to the 1.2 million homes that have done the same. Together, these domestic solar PV systems have the same generation capacity as the forthcoming nuclear plant at Hinkley Point. We should be encouraging more households to do the same and helping those with existing systems to get them working more efficiently.

In the March Spring Statement, it was announced that certain energy-saving materials would be eligible for a 0% rate of VAT on both labour and parts, and I welcome that. Solar panels and batteries, which store energy from solar panels for later use, are covered if fitted at the same time, but any battery added separately at a later date is not covered. Retrofit batteries will continue to be subject to VAT at 20%. Modern solar systems usually include a battery, but many systems installed just a few years ago do not. With more efficient and cheaper batteries now available, it makes sense for those with older systems to add a battery. The solar energy their panels generate can be used far more efficiently to the benefit of the home owner and the country overall. However, the 20% VAT rate is likely to deter many. I believe that retrospectively added batteries should also benefit from zero VAT and will bring an amendment to that effect in Committee.

Indeed, there are many other energy-saving items such as double glazing and draught excluders which are not covered by the zero VAT rate. Their take-up would increase were they to be included, which would again be to the benefit of the home owner and the country. I hope the Minister can share his view on this proposal.

[Lord Framlingham (Con)]

I am listening to the noble Lord’s speech with great interest. I understand that there are thousands and thousands of acres of factory roofs in this country. Would it not be a very good idea for them all to be encouraged to have solar panels?

[Lord Foster of Bath (LD)]

Indeed. The noble Lord is absolutely right. I was going to come on to that point. The UK Warehousing Association says that if we could get solar panels on all its warehouses, we would get 15 gigawatts of energy. The difficulty—perhaps the Minister can comment on this—is that there is difficulty in many cases with connecting to the grid. We need to find ways to help them achieve that for the benefit that the Minister just mentioned. I hope we can hear the Minister’s views on these issues, without him just shrugging them off as he has in the past, saying that this is a matter for the Chancellor.

Just like warehouses, other forms of non-domestic solar are vital; solar farms provide one such example. But we hear from media reports—the Minister can perhaps confirm whether this is true—that the Environment Secretary wishes to prevent new ones being built on the apparent basis that they are a threat to food security. Yet solar farms are a major UK success story that does not require subsidy. The chief executive of the trade association Solar Energy UK told the Financial Times last week that there is more than £20 billion of private capital in the project pipeline—investment, as well as the jobs and extra finance to support farmers it would bring, that would be lost under the Environment Secretary’s apparent plans. Yet there is no serious evidence to suggest that solar farms present a threat to food security. In fact, the opposite is true. Land around and under solar farms can and does support the UK’s nature recovery and biodiversity targets with wildflower meadows, ponds and wetlands. Solar farms drive investment, create jobs and generate clean electricity. I hope we will hear from the Minister that what we hear about the Environment Secretary’s views is incorrect.

As I said at the beginning, we support the main provisions of the Bill, but believe it is a missed opportunity to, for example, set out a clear strategic plan for addressing energy efficiency and expand and make better use of solar energy.

Queen’s Speech

Lord Framlingham Excerpts

Monday 16th May 2022 Lords Chamber

[Lord Framlingham (Con)]

My Lords, I want to talk about what must, alongside defence, be the most important concern of any Government: feeding the people. There used to be a great department of state called the Ministry of Agriculture, Fisheries and Food. It did what it said on the tin. Agriculture has now been absorbed into Defra and gets only a passing mention in the gracious Speech. Now that department’s title has gone and with it, I fear, has gone the belief that maximum food production is essential for the nation’s welfare. The spotlight has turned on to all things environmental and, if we are not careful, we shall forget what matters most of all.

I have followed the fortunes of agriculture all my life and, until recently, in helping to feed the nation it has been a huge and greatly appreciated success story. So much has changed since the old days of strict planning, marketing boards and fixed prices for farm produce set by government. Grain production has increased dramatically, as has meat production with increased welfare standards. Dairy farmers, under dreadful financial constraints, have responded superbly to the demand for milk. Over the years we have drained more land and cultivated as much as possible to provide the means of feeding the nation. The result has been, no doubt, a change in the look of the countryside, particularly in some regions, but it is important to acknowledge that this was recognised and accepted many years ago and steps have been taken to correct the situation.

In any case, what cannot be denied is that anyone travelling through our countryside today, despite larger arable fields and the yellow of oilseed rape, will find it still intact and very beautiful, so our policy must clearly be twin track. We must continue to produce as much food as possible while modifying our practices in order to protect and enhance our countryside. It is not either/or; we can, with thought and care, do both.

We are already doing so much. We are laying hedges and planting new ones, planting trees, leaving headlands uncultivated and modifying ploughing techniques to improve soil condition. We are looking again at what can be learned from the old practices of crop rotation. Fertilisers and pesticides, long a bone of contention, are now applied only when necessary, rather than routinely as in the past—better for the environment and cost- saving for the farmer.

We can protect the countryside without a loss in food production. What we must not do—but I fear we are very much in danger of doing—under any circumstances is seriously damage our food production by slavishly following the demands of the extreme climate change advocates, who, not content with rewetting and rewilding good farmland, would like, I am told, to see our dairy cows wearing methane gas masks. There is a new government slogan: “Public money for public goods”. It sounds vaguely like George Orwell’s Nineteen Eighty-Four. Perhaps, when the Minister replies, he will explain precisely what this means for farmers and how it will be administered. Who will check the hedgerows for nests and birds? Who will search the headlands for wildflowers? Who will count the hedgehogs? How will this translate sensibly into payments for farmers?

We used to pay farmers by the tonne or by the pint, which made sense. We now make payments by the acre, which does not. How will these new payments work in practice? With a rapidly growing population, and now the war in Ukraine, the shortage of grain could soon become extremely serious. For the sake of the country in both the short and the long term, we must not allow ourselves to be dragooned into ill-advised and fundamental changes in agricultural policy. We must think very carefully before we make what could turn out to be a monumental blunder.

Finally, I would like to say that sometimes our farmers are criticised for what is happening in our countryside, but who is really doing damage to our environment? Planes, trains, cars, factories, pylons, substations, wind turbines, road widenings, and huge, ugly housing developments that are completely out of place. HS2 is ploughing through ancient woodlands as we speak. Water companies are spewing raw sewage into our precious rivers. Tens of thousands of householders are concreting over their front gardens to park their cars. Townsfolk drop litter and fly tippers leave mattresses. How blessed we are to have our farmers, and how grateful we should be for all they do.

Competition (Amendment etc.) (EU Exit) Regulations 2019

Lord Framlingham Excerpts

Tuesday 4th December 2018 Lords Chamber

[Lord Henley]

My Lords, I thank all three speakers for their comments and questions and shall endeavour to answer as many as possible. First, I emphasise that, as with other statutory instruments that will be coming before the House, these are no-deal regulations. If there is a deal—if everything goes through—they will not be necessary. I do not know where they will sit, but they will gradually perish, die or whatever.

There will be more regulations—I am not absolutely sure whether there will be more regulations on this specific subject—and the noble Lord, Lord Stevenson, and others will be debating them with me in due course, and I am sure we will have a busy time over the coming months. I hope that we will at least get a break for Christmas.

I can assure the noble Baroness, Lady Burt, that the regulations will not affect our ability to tender for contracts. They are merely about mergers and anti-competitive behaviour. Ability to tender for contracts is a matter for debate on another day. She also asked about the impact of the regulations. I can assure her that they will have minimal impact on the taxpayer and businesses, as the changes in the instrument only remove deficiencies and enable the statute book to continue to function after exit. This statutory instrument aims to create clarity in law, which would minimise litigation risks. Most of the costs associated with the changes to the competition regime flow directly from EU exit, not from this statutory instrument. There may be some cost to business associated with familiarisation with the regulations, but that is the case with any legislation.

The noble Lord, Lord Berkeley, asked what happens to live cases at exit. In a no-deal scenario—I re-emphasise that that is what we are talking about—there would be no agreement between the UK and the EU on jurisdiction over UK aspects of live cases. This instrument does all it can unilaterally to clarify jurisdiction and provide clarity and certainty in the event of that no-deal exit. After exit, the CMA may conduct investigations into breaches of UK competition law that occurred before or after exit day, including live European Commission cases. In practice, I believe that the CMA would undertake a review to ascertain, among other things, the litigation risk and impact on UK consumers of opening an investigation. But if the European Commission has reached a decision before exit, the CMA will not have the power to open a new case.

The noble Lord also asked what would happen to live merger cases. It does all it can to clarify the jurisdiction in the event of a no-deal exit. At the point of exit, the EU merger regulation no longer applies. Consequently, if the European Commission has not issued a decision before exit, that regulation will not prevent the CMA taking jurisdiction over the UK aspects of the merger. The Government recognise the importance of continued co-operation between the CMA, the European Commission and national enforcement agencies. In a no-deal scenario, the Government would seek to establish bilateral or multilateral co-operation agreements with key member states and the European Commission as soon as possible.

The noble Lord, Lord Stevenson, also asked about changes to Section 60. There is a deficiency in the wording of the current section, because it requires UK courts and regulators to act consistently with EU law. The Government have therefore removed the section and introduced the new Section 60A. This provides that UK courts will continue to be obliged to ensure consistency with pre-exit EU competition case law when interpreting UK competition law, but allows them to depart from such pre-exit law where it is considered appropriate. That would be a matter for the CMA in the light of specified circumstances. This approach will provide continuity and consistency in the law for businesses and consumers, as pre-exit EU competition law will form the bank of case law from which courts and regulators will draw, while also allowing them to diverge from old case law where appropriate.

The noble Lord, Lord Stevenson, also asked what regard the courts would have for decisions of the European courts after our exit. The withdrawal Act is clear that the UK courts will not be bound by any judgment of the European courts after the UK exits the EU. However, it will be possible for UK courts to have regard to such judgments, so far as they are relevant to the matter before the court. The noble Lord also asked about the clarity of the wording of the new section. We believe that the changes to Sections 60 and 60A are targeted, reasonable and proportionate. They will reduce litigation risk for the CMA and provide courts and businesses with legal clarity.

The noble Lord, Lord Stevenson, also asked about resourcing for the CMA. We are confident that it will be ready for exit day and it continues to plan for such an outcome. My department continues to work with the CMA to ensure that this is the case. It will obviously represent a significant challenge but it will also be an opportunity for it. The National Audit Office reviewed the CMA’s exit planning and readiness and concluded that it has robust plans in place to take on a larger competition case load. As part of the Spring Statement, the Chief Secretary to the Treasury announced that the CMA had been allocated an additional £20.3 million in 2018-19 for competition, in preparation for the EU exit. The Treasury has received the CMA’s bid for additional funding for EU exit preparations in 2019-20. We will be announcing further details in due course.

The noble Lord also asked about the time limits in paragraph 7.7 of the Explanatory Memorandum. If the noble Lord is content, I would prefer to write to him on that matter, and obviously I will write on any other matters that I have failed to address. But I think that I have picked up most of the points.

[Lord Framlingham (Con)]

Before the Minister sits down, can he confirm that these regulations are simply to ensure a smooth transition if we finish up with no deal, meaning that we would have a smooth transition in that eventuality? Is it appropriate for us to keep on calling it “crashing out”?

[Lord Henley]

I have never used the expression “crashing out”, but I am grateful to my noble friend for making that point. These regulations, and a whole series of other regulations which I and other colleagues will be bringing before the House, are entitled “EU exit regulations”, and they are for dealing with that eventuality. It is essential that we make the right preparations for a no-deal situation, and this statutory instrument is part of that. It provides clarity for businesses and the clarity that will reduce litigation risk, protect consumers and provide for a smooth transition from the current system in the EU to a stand-alone UK competition regime.

Queen’s Speech

Lord Framlingham Excerpts

Monday 26th June 2017 Lords Chamber

[Lord Framlingham (Con)]

My Lords, I make no apology for returning to the vexed question of HS2, as this ridiculous scheme is getting under way. Demolition is starting, burial grounds dug up, trees felled and communities disrupted. The utmost pressure must be kept on in the hope that government common sense will prevail and an urgent review will be ordered.

I begin with the title of a comprehensive article written by the journalist Simon Jenkins, which traces the history of HS2, entitled, “HS2: the zombie train that refuses to die”. He wrote:

“It is the most extravagant infrastructure project in British history—but nobody can say why we need it. How did HS2 ever get so far?”—


a question we must ask ourselves and, depending on the answer, take the necessary action. Even at this late stage, it can be halted. The London garden bridge, another vanity project, has been reviewed and is unlikely to go ahead, despite the considerable sums already spent on it.

It is difficult to comprehend the enormity of the folly that is HS2. It is so monstrous that most people simply cannot believe it. On 31 January this year, I moved an amendment to the Third Reading of the HS2 Bill that would have put an end to it. Most of your Lordships voted against my amendment, while telling me privately that they agreed with it, but 26 Members of this House voted with me to stop HS2.

Were these 26 ill informed, or were they perhaps the best-informed Members of your Lordships’ House? Two of them were former Permanent Secretaries to the Treasury. Terry Burns, the noble Lord, Lord Burns, saw HS2 at first hand under Gordon Brown, and the noble Lord, Lord Macpherson, studied it under David Cameron and George Osborne. Both of them were so convinced of the case against continuing that they voted to stop it even at that stage.

Every dispassionate observer who is properly qualified and experienced in our railway system is opposed to it. A long list of railway experts who have no axe to grind have written to Ministers pleading for a meeting to put their case to help the Government to understand the dangers. They have been rebuffed.

Every supposed benefit of this project, including speed and capacity, has been comprehensively taken apart by those professionals, who really know what they are talking about. The noble Lord, Lord Darling, when he was Secretary of State for Transport, was so worried about the scheme that he commissioned a no-nonsense report from Sir Rod Eddington, the former boss of British Airways. Eddington’s report, which was published in 2006 was emphatic: this kind of scheme was wrong in principle and should not be undertaken. His report was enthusiastically welcomed by the Secretary of State and officials in Whitehall.

A critical report by Sir Jeremy Heywood in 2016 has not yet been made public. I wonder why. A consultant in this field, Michael Byng, was commissioned by the noble Lord, Lord Berkeley, to scrutinise the costings of HS2. His results showed that the scheme is likely to cost twice as much as the original estimate. We are talking about unbelievable amounts of money. The forecast cost was £56 billion, now thought to be nearer £70 billion, and some say eventually £100 billion.

I am reliably informed that for the price of HS2 we could rebuild and re-equip every hospital in England and Wales. Today we launched our new aircraft carrier HMS “Queen Elizabeth”, which cost £3 billion, described as an astronomic sum. In HS2 terms, it is peanuts. This scheme will last for years, a running sore constantly reminding whatever Government are in power of the massive mistake that was made through sheer obstinacy and an unwillingness to listen. It will be an ongoing financial and environmental nightmare.

Serious disruption will soon start in Camden despite the fact that there are still uncertainties surrounding how the scheme will work in the area. Homes are to be demolished, burial grounds dug up, businesses disrupted, and mature London plane trees felled. The Woodland Trust tells us that, further afield along its route, 63 ancient woodlands will be lost or damaged. This entire project is not worth the life of a single tree.

To defend the indefensible, HS2 is reported to be employing 17 PR firms to sell its case—gravy train upon gravy train. One firm is reported as being paid £280,000 to extol the virtues of HS2 to primary schools along the route. There is a constant stream of reports of hirings, firings and squabbling over contracts by those seeking a slice of the huge sums involved.

What we need, and what we must have before things go any further, is an urgent, open, Treasury-led review of the situation with proper professional independent advice taken and listened to. What harm can that do? What are people afraid of? Perhaps it is the truth. Surely, when such huge amounts of public money are being spent and such immense damage is being done, both to our urban environment and our countryside, it is vital to get at the truth.