Solar Industry

Bill Grant Excerpts

Tuesday 5th March 2019 Westminster Hall

[Claire Perry]

I am coming to that point. We have not said that the feed-in tariff is no more, and that there is essentially no value out there; there is huge value in having decentralised energy generation. My hon. Friend the Member for Eddisbury and others made some powerful points about the role of community energy, which I am passionate about. As she mentioned, it is often a way in which people drink the green Kool-Aid and realise that they can be part of this transformation; zero-carbon faith groups, for instance, are amazing movements. That is why we have continued to support communities.

I was pleased to extract from the Department for Environment, Food and Rural Affairs a commitment to the rural community energy fund, which will be reopening for bids later this year; it is an important part of delivering community schemes in many of our constituencies. We have invested £8 million in local energy hubs, which are helping some of the local authority-led schemes that the hon. Member for Hornsey and Wood Green mentioned, both in London and across the country. We have a local energy contact group, and we are working closely with communities through investments in energy efficiency, local energy schemes, and combined heat and power plants through the £350 million heat network scheme. There is a lot of support for communities that want to move forward.

The smart export guarantee is not just to provide a route to market for those who have installed, or will be installing, decentralised installations; it is intended to do a couple of things. My hon. Friend the Member for Eddisbury is quite right to say that this energy should not be provided for free, or indeed at negative prices, as is sometimes the case in other countries. She will be pleased to know that the consultation has not yet closed, although it closes at a quarter to midnight tonight, so hon. Members can make their representations.

The plan is essentially for this scheme—which, as my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) pointed out, is a market-based approach—to help move us towards the smart energy system of the future that we all talk about, in which we have decentralised energy and people are able to do the energy balancing for their home or their community, plugging in their electric vehicles and doing peer-to-peer energy trading. The scheme is designed to support all those exciting things that are out there. I had a very effective meeting with suppliers of products and services who really support this, and who want to get to that decentralised energy future. They accept the points about tariffs needing to be fair and reasonable, and needing to provide an incentive, but they support creating those prosumers, as my hon. Friend the Member for Eddisbury has said. They support creating that aggregated demand side, meaning that all of us who install solar panels will have some power and some value in the system.

[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

Is the Minister minded to ensure a fair minimum market rate for small-scale generators of exported electricity, to give them some incentive and some degree of confidence?

[Claire Perry]

That is an important question that will come out in the consultation. Frankly, I would ensure that the market rate was always greater than zero, but that it varied at different times of day, because many of us may have excess energy that we wanted to sell into the grid at a particular time. I want to see what proposals come forward for setting that market rate. There are ideas out there, including that the rate should be wholesale price minus, or that it should be entirely market led.

I take the point made by my hon. Friend the Member for Eddisbury about speed being of the essence when coming forward with a response, but I really want to get this right. I do not want this to be a scheme that we are debating in three years’ time because it has suddenly become unaffordable and has not delivered. My hon. Friend will be aware that installers are already scrutinising with care what we are saying and doing. We do not want to create a hiatus, but we want to produce a set of incentives that works for the future.