Gas and Electricity Costs

Lord Mackinlay of Richborough Excerpts

Tuesday 18th January 2022 Westminster Hall

[Jamie Stone]

I have no hesitation in joining my right hon. Friend in making that plea. His points are well made.

I hope that in getting this debate under way today, we start a dialogue with energy companies, Her Majesty’s Government and all concerned parties—not least those people who stand to be faced with crippling debts. I think of a young mother I know, who lives in the village of Balintore in my constituency. She tells me that she has to budget absolutely to balance the books; it is just a few pounds between surviving and going into the red. She says to me that if the electricity bill or the cost of diesel for her car goes up, she is in trouble. To square the books, she would then have to cut down on her expenditure. In turn, that hits the local shops, the local chemist and so on, in the seaboard villages of my constituency. I hope there will be a dialogue.

There have been, in what I have said, a lot of “coulds”, “shoulds” and “woulds”. What we really need from the Government is real, urgent action. I would suggest that they have failed millions of hard-working families and thousands of pensioners, at a time when energy bills are going through the roof. At this stage, the nation is plummeting further into a fuel poverty crisis. As far as I can see, there seem to be no plans to tackle it, but I await the Minister’s comments with great interest and expectation. At the end of the day, old people, single parents and people on very limited incomes are wondering how the heck they will get through the next period, because we all dread getting into debt.

Members from across the House have put forward suggestions to the Government on how to stop this disaster in its tracks. I respectfully suggest to Her Majesty’s Government that we stop the dither and delay, get talking, and do something about it.

[Craig Mackinlay (South Thanet) (Con)]

I thank the hon. Gentleman for securing this debate. It is a fact that all economies are facing an energy price rise, for international reasons. The hon. Member has not mentioned gas at all. No matter anyone’s views on gas, it will be part of our energy mix for a generation. I wonder if he might agree that we have been uniquely silly in diminishing our storage capacity, with the closure of the Rough field. Mother nature has given us a gift in this country: a lot of gas. No matter anyone’s view on the path to net zero, a super report by the House of Commons Library charts the reduction in our gas use over the years, and shows that we have reduced our gas capacity and production even faster, leading to imports. Does the hon. Member agree that it might be sensible to increase our domestic supply while gas is such an important part of our energy mix? That might give a longer-term solution to price volatility.

[Jamie Stone]

I will conclude in just a moment or two. I thank the hon. Member for his intervention. The bottom line is that if we care about the people I have mentioned, who are petrified of getting into fuel poverty, then we must look at all possible solutions. There will be a mix to the answer. I would not rule out anything that the hon. Member said. We will take a look at it.

Of course, if we get hydrogen production right, that also makes enormous sense, because it is absolutely neutral for the environment. Hydrogen is a gas, and we should be thinking about that as a possibility. I conclude my remarks there, Sir Edward. Thank you for your forbearance.

--- Later in debate ---

[Wera Hobhouse (Bath) (LD)]

It is a pleasure to serve under your chairship, Sir Edward. I reassure you that I will be brief. I congratulate my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone) on securing this urgent debate. In Bath, in north-east Somerset, more than 10% of households are already living in fuel poverty and, as we have heard, that is likely to increase dramatically.

The council is working hard to provide a local household support fund, with grants of £250 to help the least well off with their energy costs this winter but, again as we have heard, energy costs are likely to rise by about £600. That grant is something, but it is clearly not what is needed. Many more of my constituents are worried about their next heating bill. What have the Government done to protect them? They have scrapped the programmes to insulate our homes, which would have reduced bills long ago. They have cut universal credit and increased the UK’s dependence on imported gas, rather than investing in renewables: green energy homemade in the UK—something the Minister knows I keep saying in these debates. That is what should have happened a long time ago.

I hear reports that the Treasury is scrapping the energy company obligation scheme, which has been a powerful driver in reducing household emissions. The Government must not touch that scheme. Instead, they should double and extend the warm home discount, as has been said. It cannot be right that gas companies are profiting from record prices, way up from where they were last year, when millions cannot afford to heat their homes. The Liberal Democrats are calling for a one-off windfall tax on the profits of oil and gas firms, to fund support for those who are struggling. Seventy-one per cent. of people support that move, as do 75% of the Government’s own voters. Why are the Government not severely and sincerely looking at the proposal of a windfall tax on the profits of oil and gas companies?

We need a long-term plan to prevent another energy crisis. Where is the urgent plan for a long-term home insulation programme that will cut bills permanently? This is a particular challenge for my constituents in Bath. Bath and North East Somerset Council proposes that the Government require landlords to bring housing up to an agreed energy certification standard, and I urge the Minister to look at that. The Government’s heat and buildings strategy was a missed opportunity for real ambition in this area. We have one of the oldest, least energy-efficient housing stocks in Europe. It is an emergency, and the Government should finally treat it as such.

Liberal Democrats are committed to reducing most emissions by 2030, which means a massive expansion of renewables and the replacement of the gas grid. In the context of this debate, we all know that there are some energy companies leading the way. Companies such as E.ON pride themselves on the fact that nearly all of their electricity is generated from renewables, but the shocking fact is that, while the price of renewables falls continuously, the customers of E.ON and other renewable electricity companies will find that their electricity bills go up by just as much as those of customers who buy electricity from burning gas. I have asked E.ON directly—

[Craig Mackinlay]

The hon. Lady has a high number of listed properties in her constituency of Bath, as I have in mine. Sandwich is the oldest medieval town in the country. Has she considered how old buildings, which are listed or in conservation areas and structurally virtually impossible to insulate, can be dealt with in a way that is affordable or achievable?

[Wera Hobhouse]

I thank the hon. Gentleman for his intervention. We have had a debate on listed buildings and how we can help owners. It is complicated, but I do believe it is important that owners of listed buildings get proper support, including help from the council to change the structure of their buildings to make them more energy efficient.

As I said, it is shocking that those trying to do the right thing by buying from companies getting their electricity only from renewables are facing the same cost rises as those buying their energy from companies making electricity from burning gas. It is a massive failure of Government, who have set the terms of the wholesale market to ensure that everybody pays when gas prices go up, even if they do not use gas. That is shocking and unforgivable. The Government must urgently look into how this issue can be fixed now.