Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 26th January 2012 Commons Chamber

[Chris Huhne]

I realise that the right hon. Lady supported a different candidate for the leadership of her party from the winning candidate; nevertheless, given her repeated attempts effectively to undermine the former decisions of the Leader of the Opposition, as well as her failure to recognise their consequences, I would merely remind her, as she now likes to lecture us about the impact assessment, what the impact assessment showed in February 2010. It is important that she should go back—as she wants to look at this—because that impact assessment showed that the cost of the scheme introduced by the now Leader of the Opposition had a net present value of £8.6 billion, while the benefits had a net present value of £400 million. If she thinks that is the sort of policy making of which she is prepared to be proud, good luck to her.

[Mr Speaker]

Order. May I just say to the Secretary of State that that answer—about which he felt strongly—was too long? There must not be a repetition of that, and if there is, I will cut it off. That is the end of it.

[Jo Swinson (East Dunbartonshire) (LD)]

The Secretary of State is right to say that the design of the scheme he inherited from Labour was flawed. However, by continuing with that scheme for 18 months, coupled with apparently poor legal advice, the implementation of FITs that he has presided over has been somewhat chaotically managed for consumers and businesses alike. I am concerned that a letter from the Minister of State says that if there is no action, proposals may have to be brought forward to close the FITs scheme. What reassurance can the Secretary of State give that FITs will be put on a sustainable footing for the rest of this Parliament?

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[Chris Huhne]

As my hon. Friend knows, the Chancellor of the Exchequer announced in the autumn statement that we will bring forward a package to help the energy-intensive industry—

[Mr Speaker]

Order. I enjoy greatly listening to the Secretary of State, but can he please face the House? Then we will all have the benefit of his eloquence.

[Chris Huhne]

We will therefore bring forward that package with a consultation paper, and there will be detailed proposals at that point.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 1st December 2011 Commons Chamber

[The Secretary of State for Energy and Climate Change (Chris Huhne)]

I am sorry, Mr Speaker, but I do not have the answer to the question.

[Mr Speaker]

It is on what discussions the Secretary of State has had with major energy companies on their pricing policies.

[Chris Huhne]

Thank you, Mr Speaker. I was under the impression that the question had been withdrawn, but I am happy to answer my hon. Friend.

We have had a number of discussions with energy companies, most recently the energy summit, in which we discussed consumer pricing.

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[Chris Huhne]

The eco-consultation and that jobs estimate obviously came out before the Chancellor’s announcement in the autumn statement of £200 million of incentives for the uptake of the green deal. Those introductory incentives have been warmly welcomed across the industry and will ensure that we have substantial uptake of the green deal. On the point about funding, the whole model of providing energy efficiency changes with the green deal. That was supported across the House, including by the last Labour Government. It will, I believe, unlock substantially more money that was ever available from publicly funded, Exchequer-funded sources.

[Mr Speaker]

Order. I hope that the Secretary of State will not overuse his renewables.

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[Chris Huhne]

The hon. Gentleman has a long-standing interest and expertise in this matter, and I am delighted to answer his question.

I could not have gone to Durban any earlier than Sunday, because that is the beginning of the ministerial segment, but the hon. Gentleman can be assured that I have been involved in talks with a number of other ministerial participants ahead of the conference, including Chinese, Colombian and South African Ministers. I believe that we have a real chance of making progress. Some of the gloomiest reporting tends to appear just before the talks begin in earnest, and I have not given up yet.

[Mr Speaker]

I am pleased to learn about the ministerial segment, of which I had not previously heard.

Annual Energy Statement

Debate between Chris Huhne and John Bercow

Wednesday 23rd November 2011 Commons Chamber

[The Secretary of State for Energy and Climate Change (Chris Huhne)]

It is important that when we discuss feed-in tariffs later today we understand the impact of our policies, and that is why we have brought forward the annual energy statement—so that the House can discuss the matter in its proper context during the debate later.

I am today publishing alongside the annual energy statement a consultation document on secondary legislation to provide for the green deal. It is important that we get this consultation under way as soon as possible because it will allow an expectant industry to begin planning for this vital energy saving policy.

The statement on our energy policy fulfils a commitment in the coalition agreement, and in describing the progress made and the policies under way, the statement also honours one of the coalition’s principles: our commitment to open and transparent government.

The consumer is at the heart of everything we do. Our decisions must ensure that the consumer is protected as far as possible from rising prices, and so we will secure our energy at the lowest cost. We will do so in the short term by promoting competition, in the medium term by insulating our homes and in the long term by steering us away from excessive reliance on fossil fuels and on to clean, green and secure energy.

The ultimate goals of the Department of Energy and Climate Change are to deliver clean energy for the future and to tackle dangerous climate change. Our vision is of a thriving and globally competitive low-carbon economy with cleaner energy, more efficient homes and lower bills. Over the past 12 months, we have taken significant steps to achieve just that. On both supply and demand, we have begun to deliver key coalition commitments, starting with energy efficiency.

Energy saving is now an equal priority with energy production. An economy that wastes energy cannot thrive in a high-demand, low-emissions world. Improving energy efficiency will save money and cut carbon, which is why we are creating a new energy efficiency deployment office within the Department. Our first task is to make our homes and businesses less leaky and wasteful. The Energy Act 2011, which received Royal Assent earlier this year, provides for the green deal—the pioneering programme under which businesses will install energy saving measures in our homes and recoup the costs over decades from the energy savings.

I am today launching the consultation on the secondary legislation that will allow green deals to begin next autumn, including the energy company obligation, which will support those who need the most help. Improving our buildings is vital but we must also change how we warm them in the first place. We are determined to help consumers heat their homes and businesses securely and affordably, and we will publish a heat strategy next year.

We are also making it easier for people to save energy. In March, we set out the strategy and timetable for introducing smart meters, which can help consumers to manage their energy use. Furthermore, we continue to push for ambitious EU vehicle emissions standards, and are providing £300 million in consumer incentives for ultra-low emissions vehicles and further support for research and development.

We are also working to secure Britain’s energy supplies. We need significant new investment in power plants and infrastructure to meet future demand. In July, we published the White Paper on electricity market reform, heralding the biggest change to the market since privatisation. We are also introducing a new system of long-term contracts, to remove uncertainty and attract investment, and a new mechanism for back-up electricity generation, to keep the lights on. We are setting new standards on emissions from power stations, to ensure that they are clean, and the Treasury is supporting low-carbon generation with a floor price for carbon, to help encourage low-carbon investment in the UK. Together, the reforms will deliver secure, affordable electricity from a diverse mix of sources, including renewables, new nuclear and fossil fuels, including carbon capture and storage.

Each of those energy sources will be important. They will work together in concert to deliver a reliable energy system, and over the past year we have introduced a range of policies to support them. We have published the first ever renewables road map, setting out the barriers to deployment and what must be done to deploy renewable energy at scale. We have also published a consultation on the right level of subsidy to support jobs, investment and growth. Professor Weightman’s report into nuclear safety after Fukushima reassures me that nuclear can be an important and safe part of the energy mix without public subsidy. In October, as part of our work to enable new nuclear build, I published the regulatory justifications for two reactor designs. Fossil fuels will remain important. That is why we are firmly committed to carbon capture and storage, with £1 billion still available for projects in the CCS programme, despite the disappointment of the Longannet project. Promising projects have been proposed, and we are developing a streamlined selection process, which we will set out shortly. Gas will continue to feature strongly in our energy mix, and our policies are designed to allow new gas plant to be built. I welcome Ofgem’s proposals to sharpen incentives for reliable gas supply.

We may need further measures to ensure that we are ready for low-probability, high-impact events. I am asking Ofgem to report to us by next spring on any such measures. We are improving the technical foundation of our energy security. Earlier this month, we laid the statutory security of supply report before Parliament, which sets out future supply and demand forecasts, and discusses risks and drivers. We are also making it easier for new nationally significant energy projects to be delivered. In July, this House approved the national policy statements for energy infrastructure, against which major energy projects will be assessed. Developers can now have greater certainty about how applications for consent will be considered and absolute certainty on when decisions will be made, with statutory time scales to ensure investor confidence.

Our actions will maintain the diversity and security of our energy supplies. We are working hard to ensure that they are delivered at the lowest possible cost. In a world of volatile fossil fuel prices—we all know about the events in the middle east and Libya—those objectives complement each other. We believe that the policies we have introduced will deliver the best value for consumers, as we move towards a cleaner energy future. However, as we embark on the transformation of our energy system, we must take people with us. That is why I am today publishing an assessment of prices and bills, and the impact of our policies.

Overall, we anticipate that rising world gas prices will push up bills for both gas and electricity, but our policies will moderate that rise. By 2020, we expect household bills to be 7%—or £94—lower than they would otherwise be without our policies. Moreover, bills will be lower during this Parliament. Britain’s homes will be cheaper to heat and to light than if we did nothing, in this Parliament and in the longer term. Those savings will result above all from our energy-saving policies and from market reform. In addition, we decided to fund the renewable heat incentive and carbon capture and storage commitments from general taxation, rather than from planned levies.

To sum up again, rising global fossil fuel prices and decades of under-investment will mean that prices for energy will rise in the UK, just as they will elsewhere. We cannot control global gas prices, but we can, as a Government, soften the blow. Prices and bills are forecast to rise, but we can ensure that they rise less than they would otherwise have done.

We want to leave a fairer energy legacy than those before us did. Between 2001 and 2009, fuel poverty doubled. The warm home discount and the affordable warmth part of the ECO, on which we are consulting, are targeted at the poorest and most vulnerable households. The warm home discount will support up to 2 million homes each year, helping more than 600,000 poorer pensioners, with £120 off their energy bills this winter. Other vulnerable people will also be eligible for a rebate. That discount scheme is worth two thirds more than the voluntary scheme that operated under the last Government. The Warm Front programme helped 130,000 households last year, providing advice and installing heating and insulation, with a further 90,000 set to benefit over the next two years. As it phases out, the affordable warmth part of the ECO subsidies will phase in to replace it.

We are also helping consumers more generally to take advantage of a competitive energy market. Consumers could save up to £200 by shopping around for the lowest online rate, but last year fewer than one in five households switched suppliers. We are making it easier and faster to switch, and we have launched a campaign to encourage consumers to check, switch and insulate to save.

We are also mindful of the impact on businesses. Earlier this year we published our proposals on the simplification of the CRC—carbon reduction commitment—energy efficiency scheme and for the new climate change agreements. We are committed to simplifying the regulatory burden on industry, while driving behaviour change to improve efficiency and reduce emissions.

Lower levels of energy efficiency savings mean that our policies will typically have a larger impact on energy bills for businesses. By 2020, policies are estimated to add 19% to the average energy bill of businesses that are medium-sized energy consumers. For large energy-intensive users, who are more exposed to fossil fuel price volatility, that figure is between 2% and 20%. It is important that these industries play their part in the transition to a low-carbon economy, but it is also important that they remain competitive. That is why we are working with the Department for Business, Innovation and Skills and the Treasury to announce measures before the end of the year to support those energy-intensive industries whose competitiveness is most at risk.

The energy sector is a vital part of our economy. Energy industries employ 173,000 people, contribute nearly 4% of our gross domestic product and provide more than half of our industrial investment. More than 51,000 companies in Britain provide low-carbon and environmental goods and services. Exports are now £11.3 billion a year—up 3.9%. Last year, nearly 4,500 new jobs were created in the sector, which grew by 4.3%.

We expect that our policies, like the renewable heat incentive, will strengthen supply chains across the country, bringing jobs and growth. The green deal alone will kick-start at least £14 billion of investment in the decade to 2022 and support at least 65,000 insulation and construction jobs by 2015. We want to ensure that young people today can play their part in the industries of tomorrow, so we are supporting green apprenticeships to build the skilled work force we need to deliver the green deal.

In conclusion, between now and 2030, our relationship with energy will change fundamentally. We have to build a new energy portfolio—one that is equal to our changing needs and our ambitious carbon targets. It has to be supported by a new consensus. Helping consumers to understand their energy costs, and how our policies affect them, is key. The decisions we take now will affect the way our energy is delivered for decades to come. I commend the statement to the House.

[Mr Speaker]

We are grateful to the Secretary of State, who has significantly exceeded his time. I gently remind him of the merits of the use of the blue pencil. So far as today is concerned, I must obviously make an allowance in respect of the response from the shadow Secretary of State.

[Caroline Flint (Don Valley) (Lab)]

I thank the Secretary of State for briefing the media about his statement today, before informing either the House or the Opposition. Is it any surprise that he is becoming increasingly rattled by growing opposition from his own Benches to the Government’s cuts in the solar power sector, and has chosen to bring his statement forward in order to squeeze time in our Opposition day debate this afternoon? Perhaps he is also trying to put a gloss on the Government’s energy policy before the energy statistics are published tomorrow—or perhaps advisers or lobbyists with “excellent contacts” with Ministers advised him to bring his statement forward. Whatever the reason, disrespect has been shown to the House today.

The Secretary of State said, “The consumer is at the heart of everything we do.” Will he start by telling us what the Government will actually do to deal with soaring energy prices? Energy bills are up by 20% this year, and standard tariffs rose by £175 between June and November alone, driving up inflation and squeezing household budgets. The Government, however, are so out of touch that their only answer is to tell people to shop around, and their only policy is to cut help to pensioners this winter. Can the Secretary of State explain why, with the end of the Warm Front scheme, for the first time since the 1970s a British Government are not offering grants to help to reduce fuel poverty?

The most effective and sustainable way of cutting bills is to reduce energy use, but the Government’s flagship energy efficiency programme, the green deal, has been delayed and is in chaos. We were expecting the green deal consultation back in September. More than two months later, it has finally appeared, but we are still not clear about what incentives households will be offered to take up the green deal, or what the Government will do to ensure that the 10p rate for a green deal package is low enough to secure the widest possible range of energy efficiency measures and the best deal for bill payers. Can the Secretary of State confirm that the Government’s forecast of the number of jobs to be created by the green deal has been slashed from 100,000 to just 65,000 by 2015?

Earlier this year, my right hon. Friend the Leader of the Opposition set out bold plans to break the dominance of the big six by requiring energy companies to sell power into a pool, thus allowing new suppliers to enter the market, increasing competition, and driving up choice for consumers. Will the Secretary of State explain why he is so afraid of standing up to vested interests in the energy industry, and delivering the reform that our energy market needs?

The green economy currently employs 800,000 people. It is estimated that the global market for low-carbon goods and services will be worth £4 trillion by 2015, with the potential to create 400,000 new jobs, but as a direct result of the uncertainty that the Government have created, the UK is falling behind. Last year, when we left office, it was ranked third in the world for investment in green growth. We are now ranked 13th, behind Brazil and India. That is bad for our economy, bad for our energy security, and bad for the prices that consumers pay, because it makes us ever more reliant on events overseas that are beyond our control.

Just yesterday, the Science and Technology Committee in the House of Lords accused the Government of complacency over the skills required for the nuclear industry. Given that power stations in the UK already import staff from the southern hemisphere to run them, given that many of the firms currently providing solar power are about to go to the wall, and given that British Gas has just announced that 850 jobs are to go, will the Secretary of State tell the House how he plans to halt the worrying decline in investment in the UK?

We look forward to the Government’s forthcoming announcements on how they propose to support energy-intensive industries, and we hope that their proposals will extend to both gas and electricity, but will the Secretary of State tell us exactly how much of the proceeds of CRC are going back into Treasury coffers? Under Labour's scheme, the money was returned to the hands of businesses to be invested in energy efficiency.

We shall have time to deal with the Government’s cuts in feed-in tariffs later this afternoon, but what sort of message does this whole debacle send out? How can the Government encourage investors to support the renewable heat incentive, the green deal or any other green policies in the future, when a growing sector, built on a flagship policy that had cross-party support, has been cut off at the knees with just six weeks’ notice? How can anyone have enough confidence to make the investment that we need when the Government are so short-sighted and so short-term, and chop and change their policies at every turn?

Today’s statement is just more evidence that the Government are out of touch, are cutting too far and too fast, and have no plans for jobs and growth.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 20th October 2011 Commons Chamber

[The Secretary of State for Energy and Climate Change (Chris Huhne)]

The UK low-carbon and environmental sector is growing strongly, despite the disappointing recovery. It employs about 910,000 people, and this could reach more than 1 million by 2015—[Interruption.]

[Mr Speaker]

Order. I think the Secretary of State might have the wrong link-up between question and answer.

[Chris Huhne]

You are absolutely right, Mr Speaker.

We have negotiated a voluntary agreement with suppliers to provide consumers with a prompt on their bills to cheaper deals this winter, and an additional communication to their customers who pay by cash or cheque to let them know how much they could save by moving to the cheapest direct debit tariff. There is also a commitment from suppliers to assess the impact of the prompt on bills and to improve it in the light of this evidence.

--- Later in debate ---

[Chris Huhne]

As the hon. Gentleman knows, I am very much in favour of increasing the amount of renewable energy throughout the United Kingdom. The renewables obligation review proposes that support should be targeted particularly on areas where there is the most wind, because it is in no one’s interest to build wind turbines where there is an inadequate wind resource.

[Mr Speaker]

I call Stephen Gilbert. He is not here, so I call Julie Hilling.

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[Chris Huhne]

I am grateful to the hon. Gentleman for his question, not least because I have had discussions with Rio Tinto about the Alcan plant. It is regrettable that it made its decision ahead of the publication of the renewables obligation. That was published today, so, to answer one of the hon. Gentleman’s questions, those figures are now available, and we have just heard from the Minister of State, my hon. Friend the Member for Wealden (Charles Hendry), that the energy efficiency package for energy-intensive industries will be in place by the end of the year. In our discussions with Rio Tinto I asked the company whether it would give a guarantee about local employment if it received the support that it wanted in converting the electricity generation plant to biomass. It did not give that guarantee. That is regrettable, and the hon. Gentleman will have noticed that the Alcan decision is part of a wider programme of worldwide disposals by the company.

[Mr Speaker]

We are all significantly better informed.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

T2. Following on from the comments of my hon. Friend the Member for Wells (Tessa Munt), with energy prices at an all-time high, many low-income families are opting to convert to prepayment meters for their gas and electricity supply. However, according to Consumer Focus that can cost up to £195 extra per year. Will the Secretary of State consider introducing regulation of the market to ensure that low-income families pay the same regardless of whether their payment method is by prepayment meters, direct debit or quarterly bills?

Weightman Report (Fukushima)

Debate between Chris Huhne and John Bercow

Tuesday 11th October 2011 Commons Chamber

[Mr Speaker]

I am grateful to the hon. Gentleman, but the House and the nation now need an answer.

[Chris Huhne]

All I can say is that I am delighted; I could not expect anything less from the hon. Gentleman, who is a member of the Gorsedd of Bards: what he lacks in facts, he is able to make up for in poetry and rhetoric. Let me a deal with a couple of his key points.

I believe that the e-mail exchange reported in The Guardian, to which the hon. Gentleman drew attention and quoted, came from an official in the Department for Business, Innovation and Skills rather than from the Department of Energy and Climate Change. No, I do not approve at all of the tenor of those remarks; nor are they the tenor of the policy making we conduct in DECC. We are very clear that safety is absolutely the No. 1 concern. The hon. Gentleman will be aware that we made a clear provision in the coalition agreement that nuclear power could go ahead, providing that there is no public subsidy and providing investors are prepared to do that. That is exactly what is going on.

I think the hon. Gentleman misinterprets what Dr Weightman said about the issue of costs. The situation is exactly as I said. Dr Weightman could have looked at costs had he wanted to; the reality is that he, quite rightly as the chief nuclear inspector charged with safety, takes the view that safety comes first—regardless of the cost issues. That is why he has come up with a report that does not look into whether the measures he puts forward will or will not have excessive costs. That is for the potential operators to judge, not for Dr Weightman, and the operators will do so.

Let me end my response to the hon. Gentleman by pointing out that a published study, commissioned from Arup, available on the DECC website, puts the costs of nuclear at £71 per megawatt-hour in comparison with the lowest marginal cost at the moment, which would be a gas plant operating at £77 per megawatt-hour. Although he is absolutely right that stringent safety measures might add to costs, the other factor that needs to be taken into account is that precisely because some other countries have not gone through the same process as we have—of assessing the facts and attempting to base our policy on the evidence—they have pulled out of new nuclear construction. The result of that is that demand for new nuclear power stations has fallen. Normally, according to my basic economics, when demand falls and supply stays the same, the price goes down, not up.

--- Later in debate ---

[Chris Huhne]

The hon. Lady asks an important and interesting question, because I am determined that on the new nuclear programme we should be as open as we can be about all the considerations. Anybody looking at our past historic nuclear programme would have to be shocked. The hon. Member for Hove (Mike Weatherley) has already mentioned the £100 billion cost of potential liabilities. On an ongoing basis, that means that literally 55% of the Department’s budget this year is being spent on nuclear clean-up. Perhaps it should be called not the Department of Energy and Climate Change, but the Department for nuclear and coal clean-up, energy and climate change. That percentage goes up to two thirds next year, so the ministerial team is acutely aware of the importance of ensuring that this never happens again. There are various reasons for that. I would be trespassing on Mr Speaker’s ruling were I to go on at greater length, but I will be giving a lecture on this matter to the Royal Society on Thursday, and we will try to arrange an invitation to that for the hon. Lady.

[Mr Speaker]

The advance notice from the Secretary of State is greatly appreciated, and we thank him for that.

--- Later in debate ---

[Chris Huhne]

I certainly agree with the hon. Gentleman about the importance of using less energy. The Government are very proud of the fact that we are four-square behind a real emphasis on saving energy, which is one of the four key supports for our energy policy. That can be seen in the Energy Bill, which I hope is about to receive Royal Assent, and will be seen in the green deal next year. However, I disagree with what he says about nuclear power. Unfortunately, there are no energy sources to speak of without potential risks, downsides and detractors, whether we are talking about gas or coal. A substantial number of people worldwide are still killed mining coal every year—far more than have ever been killed as a result of nuclear energy—and there are substantial environmental consequences in parts of the world that do not apply such high standards for emissions from coal burning as we do in Europe.

[Mr Speaker]

I thank the Secretary of State and colleagues.

Electricity Market Reform

Debate between Chris Huhne and John Bercow

Tuesday 12th July 2011 Commons Chamber

[Chris Huhne]

The right hon. Gentleman makes a very good point; he is expert in this area. The Energy Bill, which we hope will achieve Royal Assent in the autumn when we come back from the recess, contains provisions that ensure that we are able to be informed about these measures and ensure greater security of supply. He will have read in the press about long-term arrangements being contracted, for example, between Centrica and the state of Qatar. We have a number of these longer-term arrangements. Security of supply is important in physical terms, and we also think about it in price terms. The 30% increase in gas prices over the past year has been a significant shock to a number of consumers. One of the reasons we want to get to low carbon is to protect the economy and consumers against that sort of shock.

[Mr Speaker]

I always enjoy reading the Secretary of State’s book, but on the whole I prefer the abridged to the “War and Peace” version.

[Tony Baldry (Banbury) (Con)]

As a Minister in the Department of Energy at the time of the privatisation of the electricity industry, I have watched with concern as a market that had 13 participants at that time has shrunk to just six under Labour. How will my right hon. Friend’s proposals drive competition?

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

Does the Secretary of State agree that a targeted capacity mechanism almost inevitably becomes untargeted as it chases lagging investment? That inevitably also leads to overcapacity, at a high price. Does he accept that a representation market, coupled with interconnection, storage and demand reduction arrangements, goes with the grain of a low-carbon energy economy and the electricity market reform measures that he is proposing? If he does, why is he holding a further consultation on capacity mechanisms outside the time scale of his main proposals? Does he have no idea what a capacity mechanism might look like, and is someone twisting his arm in the whole process?

[Mr Speaker]

I was not very good at maths at school, but I counted five questions there. I know that the Secretary of State will provide a pithy reply.

[Chris Huhne]

There is a clear description in the White Paper of the different models on which we are consulting, and we are clear that there are essentially two families. One is the strategic reserve, which is effectively bought by the Government and released into the market at a clear trigger point, and the other is a wider range of capacity that is bought through a generalised mechanism for the market as a whole. Either of those targets a particular level of spare capacity, because we have to avoid black-outs in future. If the hon. Gentleman reads the detail of the proposals, I think he will find them compelling. We will reach decisions by the end of the year.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 7th July 2011 Commons Chamber

[Chris Huhne]

I respect the right hon. Gentleman for standing up for his constituency—I would expect nothing less—but the responses to the FIT consultation were not as binary as he suggests. People did not give yes or no answers. We had to take a decision on the FIT programme for a simple reason, which was that, unfortunately, the planning that went into the announcement assumed that there would be no large-scale solar projects for three years. If the right hon. Gentleman, who was a Minister in the previous Government—as I well remember—is prepared to take responsibility for those assumptions, I would be very pleased, but sadly I am not. We have had to amend those assumptions and ensure that we have an affordable scheme that can provide steady growth—

[Mr Speaker]

Order. I am extremely obliged to the Secretary of State.

[Gloria De Piero (Ashfield) (Lab)]

Underground heat pumps and solar panels will become a fact of life for us all in the not-so-distant future. What are the Government doing to help areas such as mine—former coalfield areas—to play a part in manufacturing these things so that once again we can power Britain and the world?

[Chris Huhne]

We have seen enormous growth in low-carbon goods and services. In fact, the sector now employs 910,000 people across the UK economy so it is no longer a cottage industry—it is serious stuff. In relation to the green deal, particularly some of the kit being manufactured for it, we are in discussions with manufacturers to try to ensure that they are thinking about the scale on which the green deal will operate, because obviously if the market is relatively small, there will not be the economies of scale that can get prices down and the opportunities up. I am determined—

[Mr Speaker]

Order. We must make some progress at Question Time.

[Andrew George (St Ives) (LD)]

My right hon. Friend mentioned the review of the renewables obligation certificates. He will be aware of the great opportunity presented by the wave hub project located off the north coast of my constituency. In respect of the review, however, what reassurances can he give me and the House that there will be an even playing field north and south of the Scottish border?

--- Later in debate ---

[Chris Huhne]

The hon. Gentleman raises an important question, especially as we approach the winter months. As he may know, we have put the warm homes discount scheme on a legislative basis and it is absolutely crucial that our targeting efforts continue. We are doing a lot of work, not least with the Department for Work and Pensions, to try to ensure that we can identify the people who will be most in need, and of course the green deal, which will start next year, will prioritise those in fuel poverty so that we tackle the root causes of the problem and do not merely seek to apply a sticking plaster—

[Mr Speaker]

Order. We are grateful to the Secretary of State for his answer.

[Bill Esterson]

The Secretary of State did not answer the point about the big six, so I will give him another chance. We have some of the highest energy prices in Europe. What action is he taking with the big six to ensure that electricity and gas prices in this country are fair for those whose living standards are being squeezed by his Government?

[Chris Huhne]

The hon. Gentleman is incorrect about the comparison with other European countries’ electricity and gas prices. In fact, in both cases our prices are among the lowest. They could certainly be lower, and I am determined to try to make sure that we have the maximum competition in the market, because in my experience that is always the best guarantee that the consumer will get the best deal. That is why we want more companies to enter the market, and the electricity market reform will encourage more market entrants on the generator side. That is also why in the long term—

[Mr Speaker]

Order. I think we have got the thrust, and we are very grateful, but we must have shorter answers. Exchanges are taking too long.

[Barbara Keeley]

The charity Age UK predicts that rising energy bills will take 250,000 more pensioners into fuel poverty, and those pensioners are under-heating their homes by rationing their consumption of fuel and thereby increasing their exposure to potential ill health, misery and depression. What action will the Secretary of State take to ensure that gas and electricity prices are fairer, something that the Prime Minister promised those pensioners?

--- Later in debate ---

[Chris Huhne]

I was quite intrigued by the whole issue of double summer time because I, perhaps like the hon. Gentleman, thought that it was a bit of a silver bullet and an easy solution. Unfortunately, it turns out that there are more complications, not only north of the border but certainly there, and that the extent of the carbon reductions is not as clear cut as it may appear. However, it is a matter not for my Department but for the Department for Business, Innovation and Skills.

[Mr Speaker]

Last but not least, I call Tessa Munt.

[Tessa Munt (Wells) (LD)]

Sir Michael Pitt from the Infrastructure Planning Commission, supported by the Department, requested a fair, independent and transparent report on the cost of undergrounding and any alternative to cables and pylons. Now that KEMA has been sacked, the Institution of Engineering and Technology cannot endorse a report because there is not one. National Grid is implicated for not providing the figures that are necessary for whole-life costs. The public are left with buried figures rather than buried cables. What can the Minister do to get information on costs available to people before the development consent applications have been received by the IPC?

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 19th May 2011 Commons Chamber

[Mr Speaker]

Order. The questions are becoming too long and they need to be shorter.

[Chris Huhne]

I am grateful to my hon. Friend, and I am extremely enthusiastic about the thrust of the question. I am delighted that Ofgem is looking at this issue, because as we have known ever since the middle ages—if not before—if a market is to work effectively, we need common weights and measures, so that people can compare prices in the marketplace properly, and that is exactly what tariff simplification would enable them to do.

[Mr Speaker]

I call John Robertson. Not here.

Nuclear Industry Safety

Debate between Chris Huhne and John Bercow

Wednesday 18th May 2011 Commons Chamber

[Mr Speaker]

The Energy and Climate Change Secretary will answer the urgent question on behalf of the Government. I appeal to right hon. and hon. Members leaving the Chamber to do so quickly and quietly, affording the Secretary of State the courtesy of a decent hearing.

[The Secretary of State for Energy and Climate Change (Chris Huhne)]

Earlier today I laid before the House the chief nuclear inspector’s interim report on the events at Japan’s Fukushima Dai-ichi nuclear site in March. Dr Weightman’s final report is due in September. Safety is, and will continue to be, our No. 1 priority, and I believe that it is vital that the regulators and industry continue to adhere to the principle of continuous improvement for all existing and future nuclear sites and facilities. Dr Weightman has drawn a number of conclusions. He states:

“The direct causes of the nuclear accident, a magnitude 9 earthquake and the associated 14 metre high tsunami, are far beyond the most extreme…events that the UK would be expected to experience.”

In that respect, he concludes that there is

“no reason for curtailing the operation of nuclear power plants or other nuclear facilities in the UK.”

Nevertheless, Dr Weightman notes:

“severe events can occur from other causes and learning from events is fundamental to…the robustness of”

our nuclear safety arrangements. I can therefore confirm that once further work on the recommendations is completed, any proposed improvements to safety arrangements will be considered and implemented in line with our normal regulatory approach to nuclear safety.

The interim report also identifies various matters that should be reviewed to improve the safety of the UK nuclear industry. I consider it an absolute priority that the regulators, industry and Government should act responsibly to learn from the 26 recommendations in today’s report and respond to them within one month. My officials will review the interim report carefully, but from my discussions with Dr Weightman, I see no reason why we should not proceed with our current policy—that nuclear can be part of the future energy mix, as it is today— providing that there is no public subsidy. The interim report does not identify any implications for the strategic siting or assessment of new reactors, and I do not believe that the final report will either. Subject to careful consideration of the detail of Dr Weightman’s interim report, I intend to bring forward the energy national policy statement for ratification as soon as possible. I strongly welcome Dr Weightman’s interim report. I encourage the regulators to work closely with industry and other partners to take the recommendations forward, and I look forward to receiving the final report in the autumn.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 10th February 2011 Commons Chamber

[Chris Huhne]

Obviously, we are trying to eliminate uncertainty as rapidly as we can and trying to be as clear as possible about the policy framework. As can be seen from the announcement of the review of feed-in tariffs, it is important to get these policy details right. We cannot have a situation in which the budgeting is so badly miscalculated that there simply will not be the money to support it. We are determined to go ahead with this. Individuals will be supported under the renewable heat incentive and the details will be forthcoming.

[Mr Speaker]

May I ask the Secretary of State to face the House when speaking and not look behind him with his back to the Chair?

[Albert Owen (Ynys Môn) (Lab)]

The Secretary of State mentioned that the Office of Fair Trading was looking at off-grid gas customers who have been ripped off in the way the hon. Member for Vale of Glamorgan (Alun Cairns) explained. Will the Secretary of State consider extending the scope of Ofgem to look at both on-grid and off-grid energy supplies so that there is a level playing field? The OFT takes an awfully long time and looks only at competition, whereas Ofgem has a wider responsibility.

--- Later in debate ---

[Chris Huhne]

My hon. Friend may be referring to the debate that has been going on about the fuel duty stabiliser, but that of course is the responsibility of the Treasury and the Chancellor of the Exchequer. I understand that work is continuing on that. The key for my Department is to ensure that we speed the transition to a low-carbon economy as quickly as possible. We have to get off the oil price hook, and this episode of oil prices rising above $100 a barrel demonstrates the urgent need to make good progress on that, which is precisely why the Government are, for example, bringing forward subsidies for electric vehicles, pushing within the European Union for tougher standards on energy-efficient vehicles, and why we have the green deal. We want to ensure that our population is not vulnerable to precisely those sorts of shocks. Our policies will be—

[Mr Speaker]

That is extremely helpful.

[Nigel Mills]

I am grateful to my right hon. Friend for that information, but, given the current high price and the risk of uncertainty increasing it further, does he agree that there is now no need to encourage my constituents and his to change their behaviour through further duties, and that if we do such things we risk driving our constituents out of economic activity completely?

[Hugh Bayley (York Central) (Lab)]

I agree with the Secretary of State that our country needs to reduce its dependence on oil. Does he agree with me that the Government should do all in their power to promote democracy in north Africa and the middle east? Democratic countries are better for the people who live in them, better in terms of human rights and make for better trade partners of countries such as our own.

[Mr Speaker]

Order. A brief answer that relates to oil prices would be helpful.

[Chris Huhne]

Mr Speaker asks me to relate oil prices to democracy, which is the sort of A-level question that would test any Member.

Obviously, and crucially, open societies in particular are easier to deal with and easier to understand, and in our experience they tend to be more stable. That is a point we make to our friends right the way around the world.

[Mr Speaker]

I think the Secretary of State gets an A*.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 16th December 2010 Commons Chamber

[Chris Huhne]

I am grateful to the hon. Gentleman for his question. The first and most important point is that Ofgem, as the regulator, ought to have considerable influence over the margin above the wholesale price, and that is the subject of the inquiry launched by Ofgem. If I remember the figures correctly, that margin has risen from about £65 or £70 on a typical bill to about £90, and that is what triggered Ofgem’s interest in the matter and the review. I have encouraged Ofgem to be firm with all the suppliers as to whether such margins are necessary to bring forward the investment we require in the sector, and we await with interest Ofgem’s review.

The hon. Gentleman also asked about the vulnerable. He may have seen that we have announced support through the warm home discount scheme, which will run both for the next year and the year after—and subsequently, I hope. It will provide discounts for the vulnerable. We are also continuing to make sure that energy efficiency measures are available, such as by extending the carbon emissions reduction target, so we can help the vulnerable get through what I know can be a very difficult period, particularly if there is a hard winter.

[Mr Speaker]

May I remind the House of my keenness to get down the Order Paper and accommodate as many Back-Bench Members as possible?

[Alex Cunningham]

According to the House of Commons Library, between 1996 and 2004 the number of households in fuel poverty fell from 6.5 million to less than 2 million, but now, in the face of massive increases in energy prices, it has nearly doubled again to more than 4 million. Does the Secretary of State agree that energy companies must cut prices now and reflect the reality when wholesale prices go down, and does he also agree that those companies should play a greater part in tackling fuel poverty?

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 16th September 2010 Commons Chamber

[Chris Huhne]

The passion of the right hon. Gentleman’s oratory reminds me that I ought to wish him luck in the forthcoming Labour leadership campaign. The reality is that we are struggling: we are struggling with the fiscal legacy that his Government left us and we are having to take some very tough decisions. It is fundamental to our national interest that we are not next in line among the countries affected by the sovereign debt crisis. I know that the right hon. Gentleman has in the past pooh-poohed that as the Greek defence, but the reality is that on the weekend after the general election in our country every single finance Minister in the European Union, including—

[Mr Speaker]

Order. I am grateful to the Secretary of State, but we do not need to have a Second Reading debate on the state of the economy and we are not going to do so.

Oral Answers to Questions

Debate between Chris Huhne and John Bercow

Thursday 1st July 2010 Commons Chamber

[Chris Huhne]

The hon. Gentleman knows that it was precisely because there were very clear differences between the Conservative part of the coalition and the Liberal Democrat part of the coalition that we dealt with that as one of the key issues—we reached agreement on how we would treat it—in the first coalition agreement. We set out very clearly that there will be a framework in which there will be no public subsidy for nuclear, but that if investors come forward with proposals they will without any doubt be able to get them through the House of Commons, as there is a majority on the hon. Gentleman’s side of the House in favour of nuclear power, and the Conservative party is in favour of nuclear power.

I must say that the hon. Gentleman does a slight injustice to my personal position, which has been very clear. As an economist, I am sceptical about the economics of nuclear power, but I recognise that it is entirely up to investors to make that decision. If there is no public subsidy and if investors think that it is worth taking the risk, as they increasingly do, looking forward to rising oil and gas prices and a rising carbon price, they will take those decisions.

[Mr Speaker]

I am sorry, but I must tell the House that progress is simply too slow. We need snappier questions and snappier answers.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

Will my right hon. Friend reassure the House that he will not be put off building nuclear power stations by exaggerated fears of the dangers of disposing of nuclear waste in one or two sites, especially as those who promote those fears seem to have no doubts about the problems of sequestering CO₂ from carbon storage and capture in thousands of sites for thousands of years?

[Edward Miliband (Doncaster North) (Lab)]

Can the Secretary of State explain why it was right to give a grant to Nissan to make electric cars—a proposal we support—but wrong to provide a commercial loan to help a British company, Sheffield Forgemasters, to be at the centre of the nuclear supply chain, particularly in light of the admission by the Minister of State, Department for Business, Innovation and Skills, the hon. Member for Hertford and Stortford (Mr Prisk), that £110 million would have come back to the Government from that loan and that the Government would have got extra money if the company had made a profit?

[Mr Speaker]

The Secretary of State will keep his answer within the confines of nuclear power.

[Chris Huhne]

The right hon. Gentleman knows that the loan to Sheffield Forgemasters was not a commercial loan. If it had been, it would have been arranged through the banks and not the Government. It was precisely because of the public subsidy element and the fact that that was not affordable that the Government decided not to proceed with it.

--- Later in debate ---

[Chris Huhne]

We will come forward with a lot more detail on that in the annual energy statement, which the hon. Gentleman will be able to examine for himself, but I assure him, as I said, that the lights will stay on. Inevitably, as new generating capacity comes on stream we will see the margin increase, and as the economy recovers we can expect that margin to shrink. However, he should also bear in mind what is going on with energy saving and, particularly, the development of smart meters and smart grids, whereby in the long run there will be a possibility of, for example, turning off freezers during power peaks, to reduce the need for electricity generation.

[Mr Speaker]

I gently encourage the Secretary of State to face the House. I understand the natural inclination, but he must face the House and address the House.

[Tony Lloyd (Manchester Central) (Lab)]

The Secretary of State’s faith in market solutions is touching—like that of all those with great religious fervour. However, can he give an example of anywhere in the world where the market has actually allocated secure energy supplies?

--- Later in debate ---

[The Secretary of State for Energy and Climate Change (Chris Huhne)]

I have to say, I thought we had had this question on security of energy supply before.

[Mr Speaker]

I say to the Secretary of State very gently that that does sometimes happen at Question Time. The fact that something has been raised once has never inhibited several colleagues from wanting to raise it over and over again—nothing new there.

[Chris Huhne]

Excuse my reluctance to be repetitive, Mr Speaker.

We are determined to increase the UK’s security of supply, for precisely the reasons that I gave in answer to the hon. Member for Stratford-on-Avon (Nadhim Zahawi) earlier. Our energy import dependence will increase dramatically over the next 10 years as oil and gas production from the North sea gradually diminishes. We have to work on our renewables and on energy saving to try to ensure that we are energy-secure. One element of that is not just physical security but resilience against price shock.

Budget Resolutions and Economic Situation

Debate between Chris Huhne and John Bercow

Thursday 24th June 2010 Commons Chamber

[Mr Speaker]

I fear that we are going to have a flurry of points of order. [Interruption.] No, they are not points of order. I therefore call the Secretary of State.

[Chris Huhne]

Thank you, Mr Speaker. Let me merely assert, until the hon. Member for Rhondda (Chris Bryant) has had the opportunity to check this for himself, that the distributional analysis of changing the main VAT rate produced by the IFS today shows that there is not a regressive pattern to that when looked at by decile of expenditure.

I am very happy to defend this Budget, not least on the basis that, astonishingly, it is the first Budget in which we have a serious distributional analysis of the impact of its measures. We had 13 years of a Labour Government producing Budget after Budget, and on not one occasion in one Red Book was there a section devoted in this way to distributional analysis.