Energy

Amanda Solloway Excerpts

Tuesday 7th March 2023 Commons Chamber

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Amanda Solloway)]

I beg to move,

That the Alternative Fuel Payment Pass-through Requirement (England and Wales and Scotland) Regulations 2023, dated 19 February 2023, a copy of which was laid before this House on 21 February, be approved.

[Mr Deputy Speaker (Sir Roger Gale)]

With this we shall take the following motion:

That the Non-Domestic Alternative Fuel Payment Pass-through Requirement and Amendment Regulations 2023, dated 22 February 2023, a copy of which was laid before this House on 23 February, be approved.

[Amanda Solloway]

The instruments were laid between 11 January and 23 February 2023, and their purpose is to ensure that benefits from the alternative fuel payment, both domestic and non-domestic, are passed through to consumers. Throughout this winter, the Government have delivered critical support to households, businesses and other non-domestic consumers in response to the unprecedented rise in energy prices. The Government brought forward emergency legislation on energy support, paving the way for this support package to be delivered rapidly across the entire United Kingdom.

The alternative fuel payments scheme provides support to households, organisations and businesses that do not use mains gas and use alternative fuels such as heating oil. Eligible domestic consumers using alternative fuels will receive a one-off fixed payment of £200. Non-domestic consumers will receive £150.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Can the Minister tell us how many households are still waiting to access the £200 payment?

[Amanda Solloway]

I thank the hon. Gentleman for that question. With his permission, I will get back to him with the answer.

The pass-through requirement regulations are an important part of the support package and of ensuring that support reaches those who need it. The alternative fuel payment and non-domestic alternative fuel payment pass-through schemes set out in the regulations take the same approach as other energy schemes, particularly the energy bills support scheme and the energy bill relief scheme. They make it mandatory for intermediaries to pass the financial benefit of the schemes through to end users, which is necessary because that benefit is being delivered through electricity suppliers. In some cases, a supplier will have a contract with an intermediary such as a landlord or a heat network rather than with the end user, so we need to ensure that the support that it provides to the intermediary is passed on to the end user in a fair way.

Let me clarify what I mean by “end user”. In the case of both the alternative fuel payment and the non-domestic alternative fuel payment, an end user is an individual who consumes energy and pays for its usage through an intermediary such as a landlord. We are talking about tenants of different types—they could be domestic tenants, businesses or any kind of organisation.

Like other energy schemes, the schemes set out in the regulations require that support be passed on in a “just and reasonable” way. The regulations have been drafted in that way to account for the many kinds of relationship between an intermediary and an end user. If we used a narrow definition of “just and reasonable”, we could run the risk of inadvertently excluding some intermediaries from the pass-through requirements.

The regulations also accommodate scenarios in which there are multiple end users to whom intermediaries pass on support. They make it clear when and how intermediaries should communicate with end users regarding the benefit that is being passed on.

Our approach to enforcement is consistent with the approach taken in other energy schemes, particularly the energy bills support scheme in Great Britain. If an intermediary does not pass on the benefit to a user who is entitled to it, that user will be able to pursue recovery of the benefit debt through civil proceedings. Should a court rule in the end user’s favour, the end user will be entitled to the payment plus interest at 2% above the Bank of England base rate.

The Government have published guidance on gov.uk to ensure that the requirements are clear to all parties. If necessary, there are also template letters that tenants can use to contact their landlords if they are concerned about their energy bills. The Government are working with a wide range of stakeholders to ensure that the pass-through regulations work for everybody in scope, including vulnerable people and vulnerable groups.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

It is apparent from my constituency casework that there are people who have already received the payment through their energy company, but who probably should not have. I ask the Minister to confirm on the Floor of the House what she has told me in correspondence:

“Government will not require customers to repay an Alternative Fuel Payment which they have received, even if they use electricity to heat their homes.”

[Amanda Solloway]

As the right hon. Gentleman will know, I am very new in post, so I will check that point before I respond, if I may.

The regulations are vital to ensuring that support reaches the people it is designed to help. They are essential to the effectiveness of the alternative fuel payment in GB and the non-domestic alternative fuel payment across the United Kingdom. They will ensure that intermediaries pass on the support to those who really need it: the households and non-domestic energy customers most vulnerable to high energy costs. With all those important reasons in mind, I commend the regulations to the House.

--- Later in debate ---

[Amanda Solloway]

With the leave of the House, I will respond to the debate.

I thank my hon. Friends and other Members for their valuable contributions tonight. I will send on some information about some of the figures that I am unable to give at the moment. The regulations are necessary to ensure that we implement the alternative fuel payment scheme, in Great Britain, and the non-domestic alternative fuel payment scheme by allowing support to reach those who need it, and I think we all agree with that. The schemes are already in place and are delivering support to organisations across the United Kingdom.

As we are all aware, the domestic alternative fuel payment scheme is delivering £200 to households that use alternative fuels such as heating oil, liquified petroleum gas, coal or biomass, helping some 2 million off-grid households to meet their energy costs this winter. The scheme particularly supports households in rural areas that are not connected to the gas grid. Support was doubled to £200 in the autumn statement to reflect the price rises facing people using alternative fuels in their houses. The vast majority of eligible households should have received the payment automatically via their electricity supplier in February.

The non-domestic alternative fuel payment is delivering £150 to non-domestic customers who use alternative fuels for heating, helping premises in Great Britain and Northern Ireland meet their energy costs this winter.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

I want to pick up the point about park homes and site owners and ask the Minister to address that specific point in her closing remarks. There are concerns that site owners are not always passing on the benefit of this payment to the residents of park homes. I would like some reassurance that there are proper measures in place and penalties that will make a difference in ensuring that site owners pass the benefit of these payments on to residents.

[Amanda Solloway]

I will address that in a moment. As I was saying, the scheme supports a wide range of domestic and non-domestic customers, including businesses, schools, hospitals and churches that are not connected to the gas grid. It will also deliver a top-up payment to the highest users of kerosene heating oil. Most eligible non-domestic customers should receive their £150 payment automatically in March, and we continue to update and publicise our guidance on the gov.uk website to ensure that energy users and intermediaries understand their rights and obligations.

I turn now to a couple of other questions that have been raised—as I have said, if I do not address any of the questions that have been asked, I will write to hon. Members. One thing I can confirm is that the Government will not require customers to repay an alternative fuel payment that they have received, even if they use electricity to heat their house.

Thinking about how to ensure that energy users know how to make necessary claims, end users can recover claims to pass-through amounts as civil debts in the county courts, in the same way that other outstanding amounts owed to an individual can be claimed. However, for future pass-through requirements, we will be keeping ahead of that position and making sure that we review it on a constant basis. We have reflected on advice we have received regarding previous pass-through regulations and meaningfully engaged with stakeholders across the United Kingdom to promote and disseminate requirements for all the schemes. That includes working side by side with delivery partners such as utility regulators and energy suppliers, and key stakeholders including consumer ombudsman services.

We considered introducing sanctions on intermediaries if they failed to notify the end user of their rights. However, we decided that the incentive for end users to make an application for sanctions to be applied would be insufficient, given the time and the administrative burden involved in doing so. None the less, notification requirements were included in the statutory instruments, on the basis that many intermediaries are likely to comply with the requirements set out and that the published guidance clarifies the contents of this obligation. Furthermore, it was considered important to ensure consistency in approach across the pass-through regulations of all energy support schemes.

We will continue to seek views and feedback from those impacted by all these regulations, as well as from key delivery partners. I commend the regulations to the House.

Question put and agreed to.

Resolved,

That the Alternative Fuel Payment Pass-through Requirement (England and Wales and Scotland) Regulations 2023, dated 19 February 2023, a copy of which was laid before this House on 21 February, be approved.

Energy

Resolved,

That the Non-Domestic Alternative Fuel Payment Pass-through Requirement and Amendment Regulations 2023, dated 22 February 2023, a copy of which was laid before this House on 23 February, be approved.—(Amanda Solloway.)