Energy Prices

Christopher Pincher Excerpts

Wednesday 14th January 2015 Commons Chamber

[Christopher Pincher (Tamworth) (Con)]

I congratulate the right hon. Member for Don Valley (Caroline Flint) on the élan, and not a little brass neck, with which she outlined her case. There is no disguising the fact, try as she might, that Labour’s energy policy is in chaos. If she takes the trouble to read her leader’s speech at the party conference—the one that the right hon. Member for Doncaster North (Edward Miliband) wrote down and therefore remembered—she will see that he said time after time after time that he would introduce an energy price freeze: never a mention of a cap and never a mention of prices going down, only a price freeze. It was only after Labour realised it made that schoolboy error that it morphed its policy into a price cap. It now seems to have transmuted even further. It is a policy in chaos.

Does it matter that Labour’s policy is in chaos? Yes it does. Tony Cocker, the chief executive of E.ON, a company the right hon. Lady praised a short time ago, said in evidence to the Energy and Climate Change Committee that every time the Leader of the Opposition opens his mouth the cost of its capital goes up. Whatever we may think of the big six, we need those companies to invest in our energy infrastructure. In the past five years, each of the big six has invested about £5 billion. We all accept, even the right hon. Lady does not demur, that we need to invest about £110 billion in the next 10 years in our infrastructure—the pipes, pylons and the power stations—to keep the lights switched on. At the current rate of spend, the big six are going to invest about £70 billion only, which is an investment gap of £40 billion. Unless we can encourage those firms and others to invest more, the shortfall will have to be made up by the consumer through higher bills or the taxpayer in higher taxes, or we will have to borrow the money, meaning that market interest rates may go up and everyone’s mortgages go up as well.

The Labour party’s proposal has a very real negative effect on people’s energy prices and on their lives. Just at the time when we are discouraging investment from the big six, Labour’s proposal will entrench their position. As Ovo Energy and First Utility—the provider of choice for the Leader of the Opposition—have said, the proposal for a price freeze will drive them out of the marketplace. It will reduce competition, so there will be even fewer companies to invest and fewer companies to buy energy from. The best, simplest and right approach to deal with the cost of energy for our constituents is to reduce the confusing array of tariffs that have discouraged people from switching.

[Mark Reckless (Rochester and Strood) (UKIP)]

Will the hon. Gentleman give way?

[Christopher Pincher]

I will not give way. I will let the hon. Gentleman make his speech later on, if he so wishes.

The best and simplest proposals to reduce energy prices are to reduce tariffs so that people know what the prices are; put people on the lowest tariff that is best for them; and roll back green levies, which will save in total £250 to £300 a year for our constituents. They are not an ill-conceived sham, which is what Labour’s proposal is. Labour’s proposal is no way to run an energy policy and no way to run a Government.