Energy Bill

Debate between Lord Jenkin of Roding and Lord Kerr of Kinlochard

Wednesday 6th November 2013 Lords Chamber

[Lord Jenkin of Roding]

Some years ago I moved amendments to an energy Bill to the effect that the bills should actually show the breakdown of the costs on the supplier that is then charged on the bill. I was therefore quite pleased when I found that my electricity bills—I draw my supplies from British Gas—in fact do that. They do not show the details of what it paid up but have the total cost of government, environmental and social schemes. It is 11%. I can understand the desirability of providing people with an opportunity to break that down and find out how that figure is made up.

When we debated this in Committee, the right reverend Prelate the Bishop of Chester made this case very strongly. As it was in Committee there was quite an exchange between him and my noble friend on the Front Bench, at the end of which my noble friend said very firmly:

“My Lords, as I said earlier, I am taking the amendment away and shall reflect on what the right reverend Prelate the Bishop of Chester has raised. Like noble Lords, I am very keen that information is available, simple and understandable, but I am also keen to ensure that I can deliver what I am able to. Part of that is by taking this away and giving it further consideration”.—[Official Report, 9/7/13; col. GC 80.]

That she did, and subsequently sent a letter to those of us on the Committee. I will not read the whole passage, but it is headed “Information on consumer bills” and states:

“I undertook to reflect on”—

the right reverend Prelate the Bishop of Chester’s—

“suggestion that companies should be obliged to include information on consumers’ bills about Government environmental levies and programmes”—

thereafter pointing out that the bills are pretty crowded documents. My bill not only tells me what I have incurred during the quarter in question but what my estimated total consumption will be and how that compares with the estimated total consumption of the previous year. All those things are quite interesting, but one feels, how far does one go?

My noble friend continued:

“I agree that we must be transparent about the impact of Government environmental levies and programmes on consumer bills and that is why the Government has committed to publishing this information annually, through the Price and Bill impacts Report. In addition Ofgem produces fact sheets that provide a breakdown of costs which make up a typical energy bill”.

How many consumers are aware of those documents? Even if they were aware, how would they get hold of them? I understand the difficulty in seeking to break down that 11%. If someone is really interested in that, no doubt they can pursue it by looking it up on the internet, where I am sure that the figures are available. I hope that my noble friend can give us some reassurance about the information. As my noble friend Lord Ridley said, the public have rumbled that already; they now know that that is what is happening; hence the suggestion from the Prime Minister that some of it should be placed on taxation and not on the bills. That will no doubt be considered.

My noble friends Lord Forsyth and Lord Marlesford have a point here. I am not entirely sure that the letter from my noble friend Lady Verma has dealt with that. Can we not be told how people can best get hold of that information if they want to? Why is it not possible for every energy supplier to do what British Gas does on my bills and what Southern Electric does on a sample bill which it has given to me, which shows the cost of government, environmental and social schemes to be 11%. That does not seem an unreasonable thing to ask for, and I shall listen to what my noble friend says with considerable interest.

[Lord Kerr of Kinlochard (CB)]

My Lords, it is probably quite unnecessary to add to the avalanche of support for the amendment of the noble Lord, Lord Forsyth, which I am sure that the Minister will accept. Just in case she is still in any doubt, I will add my support for the amendment, which is absolutely right. Of course, this is the anti-hypocrisy amendment. It is much needed today, when we have spent a lot of time discussing fuel poverty. One very good way to deal with fuel poverty would be to keep prices down and finance environmental and social objectives through general taxation. That would be socially wise and would assist in dealing with the problem of fuel poverty.

I should say that my interests recorded in the register include the fact that I am the director of a power company. I am delighted not to hear boos and hisses—although I think that there was a silent one. There is hypocrisy in the current criticism of the power companies, given that this year sees the introduction of the Energy Companies Obligation and the Green Deal. The energy companies are obliged to spend huge sums of money on insulating domestic property. Then they are criticised for putting prices up.

Energy Bill

Debate between Lord Jenkin of Roding and Lord Kerr of Kinlochard

Tuesday 16th July 2013 Grand Committee

[Lord Kerr of Kinlochard]

It is comforting to know that the tweets are flowing. The trouble is that CCS has not yet been made to work. I support this amendment. I supported the efforts of the previous Government and the present Government, in partnership with the private sector, to make CCS work. I supported the £1 billion that was on offer from both Governments. I supported the EU competition, which added yet more prizes that no one has managed to win. I was involved with two companies that tried very hard. No one anywhere in the world has yet made CCS work economically.

I understand the point made by the noble Lord, Lord Deben, but I think it is important not to make this a central part of the answer when we do not yet know if we can make it work. We have to find other ways of achieving the objectives that the noble Lord, Lord Deben, has concerns about. Let us hope that this is made to work, and if these amendments increase the chances that it does, then fine. I am certainly not against the amendments and I think it is the answer. In fact, it has been the answer that people have seen coming for a long time, at least 10 to 15 years. I fear that it is still 10 to 15 years away, but by all means let us go on trying.

[Lord Jenkin of Roding]

I say this with some hesitation and with great respect to the noble Lord who has just spoken. It is not right to say that there is no place in the world where CCS is working. A couple of years ago, some of us paid a visit to the BP research centre at Sunbury, where we were given a very interesting demonstration of their plant in Algeria. BP is extracting gas from very widespread gas deposits, stretching over perhaps 20 to 25 miles in various pockets. There is a substantial refining operation that includes CCS, and the resultant CO₂ that is extracted is then pumped straight back into the gas reservoirs from which the gas has been extracted. The gas supplied for the market is then piped to the coast and goes across the Mediterranean. The noble Lord, Lord Kerr, will perhaps be able to explain his gestures. It is a single plant, I accept that, but it has been made to work and it is economic for the company that operates that gas field in Algeria.

BP also made the point that there are CCS plants in the Far East. One does not know what the circumstances are, commercial or otherwise, but there is a lot of work going on internationally on this. I started by being sceptical about the Government’s competition and the £1 billion that they have put up. I have become persuaded that, although it has taken an incredibly long time to get underway, they now have two very firm takers that are going to develop CCS. I think therefore that the noble Lord’s guess of 15 years may be unduly pessimistic.

I absolutely agree with my noble friend Lord Deben that CCS must be an essential part of our armoury if we are going to get anywhere near our 2050 target. Anything that can encourage this must be right, and for that reason I, too, support this amendment.