Energy Bill [HL]

Baroness Parminter Excerpts

Wednesday 22nd December 2010 Lords Chamber

[Baroness Parminter]

My Lords, I add my welcome to the Bill, which will, if implemented successfully, no doubt help the transition to a low-carbon economy for the UK, deliver much needed green jobs and guarantee energy security, which a number of noble Lords have mentioned. However, there are four areas on which I should like to ask for further clarification and perhaps, as the Bill goes through Committee, for some tightening up.

The first issue, which a number of noble Lords have raised, is delivering on the Government’s ambition. As my noble friend Lord Teverson mentioned, the Government have stated on a number of occasions that, by 2020, 14 million homes might benefit from retrofitting if the Green Deal is successful. However, the Government have not been clear on the level of energy and carbon savings that that would achieve. That is crucial, as this is our flagship policy for ensuring that we reduce emissions from our homes, which account for nearly 25 per cent of our total emissions. If we do not achieve it in this way, other sectors will have to deliver those savings, which, as we know, can often be done only at much greater cost than through energy saving. Does the Minister believe, as I do, that the Bill would be much stronger if it provided for an annual report to Parliament on progress with targets, with appropriate indicators, so that we can see that the necessary targets for emission reductions are being met?

The second issue is incentives. I agree with the noble Lord, Lord Jenkin, that, although we may well appeal to people’s better nature to introduce energy saving, what is encouraging about the Bill is that the Government have realised that we have to nudge people forward and offer incentives. Like other noble Lords, I should like some reassurance about the level of incentives that are being proposed. WWF has issued research showing that 7 per cent of home owners are keen to take part in measures such as those proposed in the Green Deal when interest rates are 6 per cent or lower, but that that figure reduces substantially if interest rates go up. I would be interested to know whether the Government have done any research into the level at which interest rates for the Green Deal might be set and the impact it might have on possible further incentives, such as those mentioned by my noble friends Lord Teverson and Lady Maddock, to ensure that we reach the essential uptake in this area. I have been interested in these issues for some time, certainly since I was involved in the whole area of planning, including the issue of how one can get community benefits that are targeted rather more towards the individuals within communities. Planning applications for renewable energy sites are an example. If planning applications are approved, you might be able to get discounts for the people in the local area, rather than parks, as the community benefit. I would like to see that area explored rather more fully.

Thirdly, I would like to pick up an issue that was mentioned by the noble Lord, Lord Grantchester—redress. The Bill is right to focus on ensuring that it delivers. However, it is not as clear as it might need to be on redress. As we all know, consumer confidence will be critical to ensuring the success of the Bill. The Bill indicates that the Secretary of State can issue a code of practice and regulate the conduct of assessors, producers and, indeed, their installers, but it is much less clear on the process for resolution when things go wrong—when bad advice is given or installations go wrong. The summary document talks about elevation,

“to an independent body for resolution where necessary”.

That really is not strong enough. If we are to make a success of the scheme, people need to know up front that they will not be passed from pillar to post in such circumstances. As the noble Lord, Lord Grantchester, said, with the abolition of Consumer Focus, the Bill would be immeasurably strengthened if there were a regulator or green energy ombudsman with statutory power so that people know that there is somewhere they can turn to if they receive—I hope it does not happen but am sure it will in certain cases—bad advice or are subject to mis-selling.

Fourthly and finally, I want to address an issue which I do not think other noble Lords have addressed today—the need to create a level playing field for renewables. The Bill clearly expresses the Government’s aim of achieving the co-existence of the UK gas and oil sectors with the renewable energy organisations, but to deliver this parity the Government will have to address one long-standing issue—the possibility of early repeal of Crown Estate leases when an oil or gas bid is received prior to the expiry of the lease. This creates an unacceptable level of risk for investors in offshore development. The Government say that it has not been a problem to date, and indeed Warwick Energy, the company that has recently been responsible for the largest offshore wind farms, has said that it has managed to find a way of working alongside the oil and gas companies. However, I think we need to realise that the offshore projects currently under development are much larger, further offshore and within known oil and gas provinces. If we do not address this issue soon, it will come back and bite us. I know that the Government are looking at that, but I should hope to see as a matter of urgency a protocol that learns from the experiences we have gained through companies such as Warwick Energy that can create a framework for co-existence. Without such a framework there could seem to be a bias in favour of the oil and gas industry.

We also need to find ways of creating early dialogue between the respective companies, despite the fact that much has been achieved in the planning process. I certainly hope that there might be some changes in the granting of consents under the Petroleum Act in order to ensure that there is much earlier dialogue between the renewable industry and the oil and gas industry.

Like the majority of noble Lords, I welcome the Bill. However, I ask the Minister in his summing up to comment first on the possibility of an annual report to ensure that we deliver on the targets that the Government are setting. Will he comment, secondly, on the issue of incentives, which a number of Members have raised? Thirdly, will he address the possibility of a green energy ombudsman? Fourthly and finally, will he comment on further measures for creating a much needed level playing field between the renewable energy and the oil and gas sectors?