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

Debate between Alan Whitehead and Michael Fabricant

Wednesday 22nd March 2017 General Committees

[Dr Alan Whitehead (Southampton, Test) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hanson. I thank the Minister for his Panglossian commentary on the measure. The Opposition do not want to stand in the way of these detailed regulations. I am sure the hon. Member for Lichfield, having looked in detail at the explanatory memorandum, will note—

[Michael Fabricant]

Was the hon. Gentleman looking, as I was, at the schedules? I think that, like me, he is a chartered engineer. I am slightly disappointed that there was no integration, but merely fractions involved.

[Dr Whitehead]

Regrettably, the hon. Gentleman has not done his homework about my qualifications—I am not a chartered engineer—but he makes a valid and important point about the appendices. I draw his and the Committee’s attention to an earlier part of the explanatory memorandum, which enjoins us to pass this measure because:

“The 31st March 2017 is the latest that the instrument can be brought into force, as otherwise the period set for meeting all of the targets under the 2014 Order would come to an end on 31st March 2017 and a failure by any supplier to fully meet their targets by measures installed before that date would be a breach, which could lead to enforcement action by the Administrator.”

We are discussing this order a week before we are in breach of that order. The Government are to some extent trading on Her Majesty’s Opposition’s generosity of spirit and warm-heartedness. We are sailing very close to the wind in terms of the management of the measure. The Minister might wish to have a word with his business managers to ensure that nothing like this happens again. We really should not be discussing the measure so close to that date, as we would be in breach if there were any hiccups or halts in its progress through the House.

Although I said that we do not want to stand in the way of the regulations, I am not mollified about their overall thrust. We need to be clear that the regulations will represent a reduction on the reduction in the ambition of the ECO as far as energy efficiency measures are concerned, both for those in fuel poverty and for the climate change purposes of increasing energy efficiency in properties. They are an endorsement of the collapse of the energy efficiency measures going into all homes, and even with the change of emphasis toward the fuel-poor and those receiving measures under the carbon emissions reduction obligation, other parts of the ECO have in effect been removed.

The draft regulations represent a diminution of measures to assist with fuel poverty to such an extent that, even according to the explanatory memorandum, we will barely meet the Government’s own targets, reset from previous fuel poverty targets—people in fuel poverty living in properties not worse than EPC band E by 2020 was a substantial revision of previous targets. The Government are therefore almost failing to reach their own new target in the regulations, and they are certainly endorsing a substantial reduction in measures overall.

The reduction in measures is to such an extent that, were we to look over the past five years on a graph, we would see that the measures peaked in 2012, largely as a washover of the previous Labour Government’s obligations—the carbon emissions reduction target and the community energy saving programme—to be followed by a precipitous and cliff-like fall of 80% in energy efficiency and home improvement measures up to 2015. Today’s measures, as outlined by the Minister, represent a further reduction in the ECO from £860 million per annum under the previous obligation, which was itself a reduction in ambition from the original £1.2 billion, to £640 million a year. That is for the interim scheme, and I understand that is also to be the limit for the longer term scheme, if we ever get to consultations on that in the not-too-distant future.

Under the new regime, that will be the limit of ambition for all energy efficiency measures in homes. That was not quite as the Minister set out today in terms of the progress of the obligation. As hon. Members will recall, the cut in green obligations was imposed in response to the infamous “get rid of all the green ****” period that the previous Prime Minister oversaw. As it happens, ECO measures bore the brunt of those cuts, which is why we have less money available for the ECO now, not only for today’s interim scheme, but for the scheme after 2018, assuming it happens—I will make some comments on that in due course.

We are barely reaching fuel poverty targets. I welcome the important emphasis on fuel poverty in the measures—a substantial and welcome shift of fuel poverty-focused measures up from 30% to 70% of measures within the ECO as a whole—but I emphasise that that is within an overall reduction of the pot. The consequence of that is that the measures under the CERO part of the ECO scheme reduce substantially and carbon saving community obligation measures disappear entirely. The measures under CERO represent a reduction, in that smaller pot, from 34% to 30% of the total. That is very important in terms of the treatments of properties that might be available under ECO, in terms of the energy efficiency climate change targets.

Those targets are fairly stark. In the fourth carbon budget, which was adopted and accepted by the Government, the Committee on Climate Change considered that 2.2 million solid wall treatments by the early 2020s should be included in that, to make the contribution to energy efficiency climate change targets. Hon. Members may want to reflect on the targets that are in this measure today: 32,000 treatments envisaged in the 18 months up to 2018. If extrapolated, and even if that amount is maintained over the full period of the next ECO, when it succeeds the interim measure we are discussing this morning, that would mean we would fall short of the target, which was agreed by Government, by 1.8 million treatments. That is an astonishing shortfall. That is not a question of falling slightly short—it is effectively extinguishing any serious consideration of those targets over the period, which is potentially catastrophic for our ability to meet our obligations under the carbon budgets.

The Minister will be aware that there is feverish work going on at the moment in the basement of his Department looking at how a low carbon plan can be drawn up. It has repeatedly been put off and delayed. There are assurances that it will come out later this year. I understand that there are people in the Department at the moment with towels around their heads working out how on earth a low carbon plan can possibly meet the terms of the fourth carbon budget, in terms of what the Government are presently undertaking. The complete failure in this measure to get to grips with solid wall insulations is one area where those towels will have to be tied much more tightly around heads.

Does the Minister intend to review the figure and the mechanisms behind it when looking at the longer term ECO? As set out in the 2015 autumn statement, that is scheduled to take us on from 2018 to 2022. If he is not looking at reviewing those measures, what explanation might he offer for this abject failure to get to grips with solid wall insulation? Are there any other measures that he might be thinking about that could get us back on track as far as those treatments are concerned?

I would also like to ask the Minister about the very wise consultation response that came forward to him. I am sure the hon. Member for Lichfield will also be aware that there is a passage on the consultation at the back of the explanatory memorandum. It indicates that those people who were consulted thought that local authorities should be involved in identifying 20% or more placements for treatments, particularly as far as the fuel poverty element of ECO is concerned. That was an overwhelming endorsement in the consultation of the role of local authorities in identifying and assisting those treatments at local level. There was also an overwhelming endorsement by those obliged suppliers themselves, who have for a long time said how difficult it was to find people in those fuel poverty categories, in order to apply treatments, and the substantial additional burden of finance that often placed on them.

[Michael Fabricant]

Would it not be fair to add that this is just during the testing period, as it says in the explanatory notes? The Government can then come back with the alternative percentage.

[Dr Whitehead]

The hon. Gentleman anticipates my next paragraph. The explanatory statement mentions that this is a testing period. The whole of the obligation we are discussing is essentially a transitional testing period from the old ECO to the new ECO.

Bearing in mind that both those responding to the consultation and those obliged suppliers all thought that local authorities should have a much more substantial, economical and effective role in bringing forward people in fuel poverty who require treatments, why have the Government, even in this transitional period, limited that role to 10%? Is there a reason that the Government have decided it should be 10% for local authorities, when the evidence overwhelmingly points in the opposite direction? Do the Government not trust local authorities to identify those people, or do they believe that what the obliged companies are saying is not so, and that it is a walk in the park to find people in fuel poverty, so that the arrangements can proceed as before? If the Minister is not able to say anything today about that 10% figure, what is he going to do during the period of transition, pointed out by the hon. Member for Lichfield, to appraise whether local authorities can have a greater role? Can he assure me that when we are able to look at the detail of the later ECO, that will be reviewed and that the position of local authorities in deciding who gets treatment and how it can best be related to obliged suppliers can be established on a coherent basis?

I do not wish to detain the Committee further, but I do emphasise that the Opposition consider the measures to be woefully inadequate for those in fuel poverty and to address wider concerns about climate change. If we had the opportunity, we would fundamentally revise their scope and extent in order to make a proper impact on fuel poverty and the overwhelming imperative of getting energy efficiency under control in the context of concerns on climate change.

Draft Onshore Hydraulic Fracturing (Protected Areas) Regulations 2015

Debate between Alan Whitehead and Michael Fabricant

Tuesday 27th October 2015 General Committees

[Dr Alan Whitehead (Southampton, Test) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hanson.

This simply is not good enough. It defies belief that arrangements set out in the Infrastructure Act can be separated out in the way that the Minister has described, talking about fracking underground as if it had no relation whatever to the pipe that leads up from the underground fracking, that leads to the drill head at the top of the pipe, that leads to the water coming out of the pipe and being held in containment ponds on the surface, that leads to the vehicles bringing the water to go down the pipe for fracking. It is preposterous to suggest that associated hydraulic fracking is nothing to do with the rest of the process of fracking that inevitably has to take place on the surface and down through the ground to the point at which the drill bit turns left or right and goes into the horizontal seam and then begins the fracking.

We can see why that suggestion is preposterous in the Infrastructure Act. As the Minister has indicated, this SI does indeed arise from section 50 of the Act, which is headed “Onshore hydraulic fracturing: safeguards”. Section 4B(4) of the Petroleum Act 1998, which is inserted by section 50, requires the Secretary of State by regulation to specify descriptions of areas that are protected in the section. That is essentially what the Minister has told us this afternoon: it is something she is thinking about at the moment and she may come back at a later date with a definition. However, the definition is already required by section 4B. The protected areas are numbers 5 and 6 of the table in section 4A, which state that

“The associated hydraulic fracturing will not take place within protected groundwater source areas”,

and

“The associated hydraulic fracturing will not take place within other protected areas.”

One might think that that is clear. The regulation defines the areas—what is in, what is out and what is the extent of the areas.

It is clear also because those two items in the table directly arose from an amendment to the Infrastructure Bill accepted by the Government at the time, which specified that,

“Any hydraulic fracking can not take place...in land which is located within the boundary of a groundwater source protection zone…within or under protected areas”

or

“in deep-level land at depths of less than 1,000 metres”.

The amendment was modified to some extent during the passage of the Bill through another place, but by and large it remained intact as a list of prohibitions on or conditions attached to the fracking process that is a hydraulic fracturing consent issued by the Secretary of State. So clear was it that upon acceptance of the amendments even before the Bill went to another place, the Secretary of State declared:

“we have agreed an outright ban on fracking in national parks, sites of special scientific interest and areas of outstanding natural beauty.”—[Official Report, 26 January 2015; Vol. 591, c. 586.]

So that was that: no fracking pads, no trucks, no water retaining ponds, no drill heads, no drilling rigs in those areas. All that was left to do would be to winnow out the precise designation of what those areas were, and that is what was required in the regulation that is in the legislation. There might have been an issue, for example, about the exact extent of groundwater source protection zones, but the regulation would sort that out.

One might ask: what could possibly go wrong? Well, quite a lot has gone wrong. Yes, the instrument before us defines what is in groundwater source protection zones; it defines other protected areas, including national parks, the broads, areas of outstanding natural beauty and world heritage sites; as has been pointed out, it defines out all but zone 1 groundwater source protection zones; and it defines completely out sites of special scientific interest—but then, as in the fracking process, it veers away at 90 degrees. It uses a very curious definition of what constitutes associated hydraulic fracking within those defined zones. It merely adds an additional protection zone of 200 metres to the 1,000 metres nationally above which the process of fracking can take place. If the Government really intended to undertake as a separate exercise the process of deciding in which areas fracking would be banned completely—and these would be identical to the areas defined in this statutory instrument—why would they introduce a zone below which fracking can take place? Why does regulation 3, at that point, state that associated hydraulic fracking can take place at depths below 1,200 metres, rather than 1,000 metres, as is the case nationally, if indeed there was to be no fracking at all in those particular areas? It simply makes no sense.

Reading the definitions in the statutory instrument, along with the provisions of the Act, we can see that only the associated hydraulic fracking that might otherwise take place within that chunk of defined land—it is all underground, from 0 metres to 1,200 metres—cannot happen. That is the protected lump of rock in this particular statutory instrument.

[Michael Fabricant]

On a point of order, Mr Hanson. I am sorry to interrupt the hon. Gentleman, but I understand that there will be a vote at 3.5 pm, which will be followed by a second vote. Can you define when Committee members have to come back? There will be a suspension during the vote, but if it is a 20-minute vote followed by another, will we have to come back and then go back down to the Chamber?