Ed Davey
Main Page: Ed Davey (Liberal Democrat - Kingston and Surbiton)
Diana Johnson (Kingston upon Hull North) (Lab)
1. What assessment he has made of the effect of changes to the feed-in tariff on the number of solar PV installations in the last 12 months.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
In the last 12 months, there have been approximately 270,000 photovoltaic installations registered on the microgeneration certification scheme database, against a forecast of just 35,000 installations when the scheme was launched in 2010. Moreover, having substantially reduced the cost of each installation to electricity bill payers, the coalition is now in a position to significantly expand the ambition of the feed-in tariffs scheme.
Diana Johnson
Following the chaotic cut to the feed-in tariff, there has been a 90% fall in solar panel installations, and 6,000 jobs have gone in the industry, including more than 100 in my constituency of Kingston upon Hull North. Does not the Government’s mismanagement and this debacle mean that the industry could be strangled at birth? It also puts at risk investment in the renewables industry, which is so important to areas such as Hull.
Mr Davey
I am surprised the hon. Lady reaches that conclusion. Since the 21p tariff came in 10 weeks ago, there have been more than 26,000 installations with 86 MW of capacity, which is equivalent to the installation rate achieved in August 2011, when the tariff was at 43p. The installation rate in the period is 1.7 times what it was in the same period last year.
Mr Philip Hollobone (Kettering) (Con)
Feed-in tariffs are not the only way to encourage solar PV installations. Can more be done with building regulations, especially to encourage solar to be built in to new-build properties at the start?
Mr Davey
I am sure local authorities will look at that proposal, but the key thing is to ensure that our new, more stable and predictable regime supports the solar industry, as we believe it will. We need to ensure that the message goes out that the solar industry is back in business and on a sound footing. There will be many more solar installations compared with what happened under the solar installation regime we inherited from the Labour party.
Caroline Flint (Don Valley) (Lab)
Last week, just 900 installations took place and two thirds of businesses had empty order books, but my question is about the Government’s next round of cuts to solar, which is due on 1 July. Last night, the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker), tweeted:
“Having listened carefully to industry, we are looking at scope for pushing back a little the next proposed reduction in the #solar tariffs”.
The truth is that the Government have missed the deadline legally required to provide notice to Parliament for the next round of cuts to come into force. Is not the Government’s incompetence the real reason why they are backtracking?
Mr Davey
The right hon. Lady seems to think that we should not listen to the industry, but I do. We are considering tweaking the start date for the next tariff reduction—if we change it, it will be a tweak, not a massive change. She needs to understand that the changes that we have consulted on and are introducing will bring stability and mean that we have solar power for the many, not the few.
Caroline Flint
There will be laughs echoing outside the Chamber at the Secretary of State’s suggestion that the Government have been listening to the industry, but my question was about parliamentary procedure. Parliamentary procedure requires that due notice must be given in advance of the cuts being brought into force on 1 July. My understanding is that the Department has missed—legally—the deadline required. Will the Secretary of State therefore confirm whether the Department has missed the deadline required to give notice to Parliament? If it has, it is absolutely the truth that the Government cannot legally impose the cuts on 1 July. Why does the Secretary of State not just own up, end the uncertainty and commit to scrapping the next round of cuts on 1 July?
Mr Davey
The right hon. Lady started by saying that the industry will be laughing, but Paul Barwell, the chief executive of the Solar Trade Association, said in The Independent on 9 May 2012:
“The current 21p subsidy can actually give a return up to 10 per cent, tax-free, index-linked, for 25 years, making it one of the most attractive investments around.”
That is what the industry is saying. The Government will abide by all the procedures required by the House and lay the regulations when required.
David Rutley (Macclesfield) (Con)
2. What progress his Department has made on the introduction of the green deal.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
4. What steps he is taking to help households with their energy bills.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
The Deputy Prime Minister recently announced an agreement with energy suppliers to ensure that all consumers have good information on their supplier’s best tariff. This builds on previous actions by the Government to help people to control their bills, and complements Ofgem’s proposals in the retail market review to protect consumers. We are also encouraging consumers to harness their collective purchasing powers.
Debbie Abrahams
I thank the Secretary of State for his reply. In my constituency, 6,563 over 75-year-olds would benefit by £200 a year from being put on the lowest tariff. I appreciate what the Government are doing, but many of those people are unable to access online facilities easily. What else can the Government do to ensure that they benefit from these measures?
Mr Davey
Thanks to the deal that we have negotiated and that the Deputy Prime Minister has announced, those pensioners in the hon. Lady’s constituency will be written to every year by their energy supplier and advised of the best tariff for them. Furthermore, because of the warm home discount for which this Government have legislated, 600,000 of the poorest pensioners in the country are getting a direct discount of £120 off their energy bills. That is real action.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Will the Secretary of State commend the work of the Energy Saving Trust on reducing household bills? Will he also point it in the direction of reducing the cost of heating water, as a means of reducing overall energy costs, by heating only the water that a household needs to use each day?
Bill Esterson (Sefton Central) (Lab)
If the Secretary of State is serious about the green deal, why will he not ensure that the energy companies have to put the 9,914 pensioners over the age of 75 in my constituency, and others around the country, on to the lowest tariff?
Mr Davey
I think the hon. Gentleman is mixing up the green deal with the action that we are taking to help people with their consumer bills. The warm home discount, which targets the 600,000 poorest pensioners, is one of the most effective ways of providing that help. Under the scheme proposed by Labour, some of the wealthiest pensioners would get the discounts, and I am afraid that that shows that it is no longer the party of the many.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)
I very much welcome the move to ensure that the market works as efficiently as possible, so that consumers pay no more than is necessary. Should we not make it clear to consumers, however, given the amount of investment that needs to be made in our energy infrastructure, that future generations will have to pay a higher price to ensure that we can keep the lights on in a low-carbon way?
Jim Shannon (Strangford) (DUP)
People have real concerns about energy prices. They also have real concerns about the amalgamation of energy companies—be they electricity, gas or oil companies—and the control of prices that results from that. What assurances can the Minister give us that the Government will always be the protector of prices for the consumer?
Mr Davey
The hon. Gentleman is right. Energy bills are a real concern for many households around the country. That is why we are taking the action we are. He refers to consolidation in the sector. That certainly happened under the last Government. What we are doing is trying to make sure we can get more competition into the sector. We have seen Ofgem’s proposals for dealing with liquidity in the wholesale markets, while the work I am leading on collective switching is intended to enable consumers to generate more competition. Competition is what we want to see.
Tessa Munt (Wells) (LD)
5. What discussions he has had with the Secretary of State for Communities and Local Government on the potential long-term community benefits of the Hinkley Point C nuclear power station and other major infrastructure projects.
Mr Edward Leigh (Gainsborough) (Con)
7. What steps he is taking to listen to a diversity of views on the causes of change in the Earth’s climate.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
My Department considers many views on the causes of climate change, and I encourage my officials to take all available scientific evidence into account when developing policy. However, the fact that we are open to a range of views does not mean we ascribe equal value to each.
As with all scientific endeavour, climate science involves uncertainties, but it is considered very likely that human activities are the major cause of current climate change, and compelling evidence shows that climate change brings major risks for us all. It would be deeply irresponsible not to act decisively and urgently to deal with climate change in the United Kingdom and globally.
Mr Leigh
I am no scientist, and I do not know the truth about the controversies that are raging around global warming, although I note that Dr James Lovelock wrote recently that, in his view, temperatures had remained broadly constant over the last 12 years. I do not know whether that is right or wrong; what I do know is that before we spend trillions of pounds on reining in our competitive economy and desecrating our country with wind farms, we should actually listen to a range of views.
Mr Davey
I know that, as a former distinguished Chair of the Public Accounts Committee, the hon. Gentleman wants to take evidence and science into account, and that he understands risk and probability. The case for action is overwhelming, whether it is made by the Intergovernmental Panel on Climate Change or the Stern review.
Mr David Hanson (Delyn) (Lab)
8. What assessment he has made of the change in the number of solar panel installations since he announced changes to the feed-in tariff.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
When we announced proposals to reform the feed-in tariffs scheme for solar PV at the end of October 2011, approximately 126,000 solar PV installations were registered on the microgeneration certification scheme database. Since then, an additional 190,000 installations have been registered. In the 10 weeks since the introduction of new tariffs for small-scale installations on 3 March, more than 26,000 solar PV installations have been registered. That is equivalent to the installation rate in August last year.
Mr Hanson
I hear what the Secretary of State says, and I heard what he said in response to my hon. Friend the Member for Kingston upon Hull North (Diana Johnson) and my right hon. Friend the Member for Don Valley (Caroline Flint), but I can tell him that in my constituency there has been a catastrophic collapse in the demand for feed-in tariffs. It has been particularly catastrophic for small businesses which have invested many thousands of pounds of their own money in what would have been a very positive regime. Will the Secretary of State clarify, very soon, what will happen after July, so that my constituents who have invested money in this scheme can ensure that they will still have their businesses in October and at the end of the year?
Kelvin Hopkins (Luton North) (Lab)
We are soon to see a new generation of highly efficient solar panels, and we are also soon to see efficient domestic battery storage technologies. Combining that with a mass programme of insulation and a Severn barrage would remove the need for nuclear generation. Will the Government think again about the need for it?
Mr Davey
The uncertainty surrounding climate change, and surrounding all technologies, is such that it would be irresponsible not to pursue every possible low-carbon technology. The hon. Gentleman is right to suggest that renewables have a positive future, as does solar power. We propose to deliver an additional 620,000 installations at a cost of just £500 million by 2015—that is, to deliver nearly three times as many installations as were delivered under the old scheme, at a third of the price.
John Robertson (Glasgow North West) (Lab)
9. What recent discussions he has had with the Scottish Government on the effect of potential Scottish independence on energy policy.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
I have had no recent discussions with the Scottish Government on the effect of potential Scottish independence on energy policy. The UK Government’s position on the independence debate is clear: Scotland is stronger in the UK, and the UK is stronger with Scotland in it.
John Robertson
I think that a few people will have been slightly disappointed by the Secretary of State’s answer. According to evidence given to the Select Committee on Energy and Climate Change by Peter Atherton of Citigroup Global Markets, investment in Scottish renewables in an independent Scotland would be “highly questionable”. Given that other companies are also saying that they are withholding investment, should not a referendum on Scottish independence be held now rather than later, for the good of energy in this country?
Mr Davey
The hon. Gentleman knows the position of Her Majesty’s Government. He knows that we would like a referendum to be held sooner rather than later. We are very committed to ensuring that there is investment in the UK’s energy infrastructure, whether it takes place in Scotland, England, Wales or Northern Ireland. However, some people are saying that uncertainty about an independent state is putting off some investors, and that is one reason for thinking that the independence referendum should be held sooner rather than later.
Alec Shelbrooke (Elmet and Rothwell) (Con)
10. What steps he is taking to reduce domestic energy bills.
Graham Stringer (Blackley and Broughton) (Lab)
17. What steps he is taking to reduce domestic energy bills.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
The Government are committed to reducing domestic energy bills, and have put energy efficiency at the heart of their energy policy. The green deal will drive the take-up of energy efficiency measures in homes, helping to reduce energy bills. In addition, the roll-out of smart meters will further reduce energy use. Vulnerable customers will also benefit from the warm home discount, which is worth £1.1 billion over four years.
Alec Shelbrooke
My right hon. Friend will be aware from his constituency, as I am aware from mine, of the pressure that people are coming under with their fuel bills. Will he outline for my constituents, as well as everybody else’s, what the electricity reform Bill will do to help keep costs down?
Mr Davey
My hon. Friend is quite right to point to the fact that one reason for bringing forward electricity market reform and the energy Bill is to ensure that we meet this country’s energy infrastructure needs, which are huge, as we see 20% of power plants coming offline over the next decade and the need to make the transition to low-carbon energy. That is a huge challenge, which could be very expensive for consumers. One of the reasons we need to reform the electricity market is therefore to ensure that that infrastructure investment can be made at the lowest cost imaginable.
Karl MᶜCartney
Can my right hon. colleague update the House on his Department’s progress in cutting red tape for small energy suppliers to help increase competition in the market and thereby keep prices down for my constituents in the city of Lincoln?
Mr Davey
I am grateful to my hon. Friend for that question. There are two things I would point him to. We are helping small suppliers to compete by increasing the customer threshold for participation in schemes such as CERT and CESP—the carbon emissions reduction target and the community energy saving programme—and the warm home discount scheme. Ofgem is currently consulting on proposals for a mandatory auction in the wholesale electricity market to improve liquidity, and has recently completed a consultation on tariff simplification. All these measures will, we believe, help small suppliers in my hon. Friend’s constituency and elsewhere.
Graham Stringer
Will not the biggest impact on reducing domestic energy bills be achieved by bringing shale gas online as quickly as possible?
Mr Davey
I do not think so. We had a seminar at No. 10 recently, which the Prime Minister participated in, along with myself and the Business Secretary. We heard from experts in the shale gas industry who had been working in America and looking at the major opportunities in places such as Ukraine and China. They were clear that it would take some time for shale gas to be exploited in the UK. They were also clear that we needed strong regulation to proceed and that the shale gas reserves in this country are not quite as large as some people have been speculating.
Andrew George (St Ives) (LD)
Given that so few large companies took part in last week’s big switch, does my right hon. Friend agree that we should be concerned about the responsiveness of large companies to customers’ concerns? What can the Government do to ensure that all companies engage with any such initiative in future?
Mr Davey
At least three of the big six were involved. I thought that the way in which the reverse auction was conducted by the consumer association Which? was a real success, and I am delighted that my hon. Friend noticed it. It brought a saving of £25 million to consumers who were part of that collective switch, with an average saving of £120. It was therefore a success, and I want to see more energy companies getting involved in such schemes.
Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
As the hon. Gentleman will know, my Department’s key objectives are to have secure, clean and affordable energy and we have been working hard on those objectives. The energy Bill measures to reform the electricity market are very important for that. We hosted the clean energy ministerial very recently, which was attended by Ministers from 23 leading economies, and we worked together on clean energy technologies. I was particularly pleased to see that Professor John Hills’ report—the independent review of fuel poverty—was published.
Gregg McClymont
I thank the Minister for that answer. Last week it was Centrica and this week it was Scottish and Southern Energy announcing record profits at a time when household bills continue to rise. In those circumstances, why will not the Government insist that the big six must write to customers telling them what is the cheapest tariff rather than directing them to the phone or the internet, where there is no guarantee that they will get the right information?
Mary Macleod (Brentford and Isleworth) (Con)
T2. Under the previous Labour Government the number of households living in fuel poverty rose to almost 6 million. What are this Government doing to help the poorest households in my constituency?
Mr Davey
We are doing a huge amount, from the warm home discount to the push on collective switching. My hon. Friend will know that today’s figures on fuel poverty show a fall of 0.75 million, but we should not celebrate that because those figures are based on the current measure of fuel poverty. If they were recalculated using the methodology proposed by John Hills, the fuel poverty figures would stand still. There can be no room for complacency; we have to redouble our efforts to tackle fuel poverty.
Caroline Flint (Don Valley) (Lab)
This week, we learned that the Foreign Secretary—for whom I understand the Minister of State, Department of Energy and Climate Change, the hon. Member for Wealden (Charles Hendry) was once the chief of staff between elections, just to add to his biography which we are learning about today—does not think the Government are doing enough to support the low-carbon economy. I absolutely agree with him. We also learned that the Energy Secretary and the Business Secretary wrote back urging caution. It was bad enough when the Chancellor was talking down the green economy, but for him to be joined by the Energy Secretary absolutely beggars belief. Is not the Foreign Secretary right that unless Britain shows strong leadership on the green economy, there is no hope of securing international agreement on climate change?
Gordon Henderson (Sittingbourne and Sheppey) (Con)
T4. Despite assurances from my hon. Friend the Minister, small double-glazing companies in my constituency still feel that they are being elbowed out of green deal work by larger national companies. What more can my hon. Friend say to reassure small and medium-sized enterprises in Sittingbourne and Sheppey that they will be able to access green deal work?
Julian Sturdy (York Outer) (Con)
T6. As high energy bills continue to affect local households in my constituency, can the Minister outline what the Government are doing to improve the UK’s long-term energy security problems? If energy security is not addressed—I stress that it is a long-term issue—energy bills will continue to soar.
Mr Davey
My hon. Friend is exactly right. Later this month when we publish the energy Bill, he will see that we have very ambitious electricity market reforms to deliver, among other things, energy security in the future. We need investment of £110 billion in our energy infrastructure over the next decade. That is a real task, and we need to make sure that there are incentives to bring forward that low-carbon investment.
Dr Julian Huppert (Cambridge) (LD)
T9. Earlier, the Secretary of State mentioned the excellent Which? big switch scheme to save people money. What I particularly like about it is the fact that it is based on co-operative action—individuals choosing voluntarily to work together rather than a statist top-down approach. Does my right hon. Friend share that view and what support was he able to give?
Mr Davey
I am grateful to my hon. Friend for his question. He will know that when I was at the Department for Business, Innovation and Skills, I stimulated a huge amount of research and work on collective purchase and co-operative principles so that together we can purchase not just energy but other things more cheaply. I asked if the Department had any detailed research, because I thought the previous Government, who were supposed to be in favour of collective and co-operative principles, might have done some—they had not.
Barry Gardiner (Brent North) (Lab)
In his preparation for COP 18, what analysis has the Secretary of State made of Professor Sir David King’s proposals for common but differentiated cap and trade schemes, using the human development index as an appropriate measure?
Mr Davey
We are taking forward a lot of analysis, not just on that scheme, but on a number of other things. COP 18 in Doha at the end of the year will be really important; I met the Deputy Prime Minister of Qatar recently, to discuss how we can make sure that it is a successful set of discussions.
Jeremy Lefroy (Stafford) (Con)
T10. What discussions is my hon. Friend having with energy-intensive industries such as ceramics and steel, which are key employers and exporters, to ensure that their prices are competitive with countries such as Germany and France?
Caroline Lucas (Brighton, Pavilion) (Green)
Will the Secretary of State join me in congratulating Brighton energy co-op on its launch last night of the first community generation scheme in Brighton? What is he doing to ensure that the electricity market reform proposals will properly support community energy schemes, particularly those by co-ops, housing associations and local authorities?
Mr Davey
I can congratulate the scheme in the hon. Lady’s constituency. It shows that under the new regime of solar feed-in tariffs that we have introduced, there are still many communities that are going forward and making those investments. That belies much of the criticism we have heard in the House today. I can assure the hon. Lady that we want to continue to encourage such community schemes in our future policies. Quite a lot of those schemes will still get the more standard and common renewable obligation approach support. Some of those community schemes will not have to go to the larger-scale contracts because of the difference in the electricity market reform.
Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)
Will Ministers redouble their consistent and very welcome efforts of the past couple of years in support of the onshore manufacturing sites for offshore wind turbine production—not least sites like Kishorn in my area, which I raised with the Minister’s predecessor—which have lost out in enterprise zone status, and therefore find themselves at a bit of a competitive disadvantage over the next five years? I am sure that a summer recess ministerial visit to Kishorn and the west highlands would be most welcome and would boost morale.
Ian Swales (Redcar) (LD)
I welcome the current carbon capture and storage competition. As the Tees Valley has 18 of the top 30 UK carbon emitters, I am sure the Minister will agree that its bid has a lot to commend it. Will he ensure that the needs of heavy industry are given due weight alongside the needs of energy generators?
Mr Davey
I am grateful for my hon. Friend’s question. I know he does a huge amount to support industry in his constituency. I can tell him that in the competition that we announced at the beginning of last month, we were very clear that we wanted to encourage clustering, so after listening to the industry we were encouraging change. Bigger pipes are needed, so that more than one power plant can take part in those schemes with other industries that emit a lot of carbon.
Ian Lavery (Wansbeck) (Lab)
Coal will continue to provide between 27% and 50% of electricity in the UK for the foreseeable future. Can the Minister explain what Government support will be given to the British deep-mined coal industry to prevent it from extinction in the next few years?
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
The Secretary of State knows that if we are to get energy security and diversity, we have to invest now in big infrastructure projects, but he knows also that nimbyism, often so rampant in the questions put in this Chamber, is a great barrier to planning permission. What is he going to do about planning for decent infrastructure to achieve those objectives?
Mr Davey
The hon. Gentleman knows that this House passed a relevant national planning statement and that the Department for Communities and Local Government produced the national planning policy framework. The hon. Gentleman must recognise that there is a balance to be struck between the need to make sure that the local democratic voice is heard and the need for the types of investment that both he and I support. There is a balance, but we are determined to ensure that, with electricity market reform, we get the investment needed in this country.