Gordon Birtwistle
Main Page: Gordon Birtwistle (Liberal Democrat - Burnley)(11 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gordon Birtwistle (Burnley) (LD)
The problem is that electricity suppliers buy the fuel that produces the electricity from the world markets. Gas, oil and other fuel supplies are bought on the open market: the gas supplied in Russia, for example, can be sold to the United Kingdom, or indeed to any country, at a price. When the price of gas rises, the end result is that the price of electricity also rises, and the same applies to oil.
Gordon Birtwistle
That is true, but my point is that fuel is bought and sold on the open market. We need to ensure that the supply of both gas and nuclear fuel in this country is secure for the long term. We do not want to rely on foreign suppliers, because that could bring about a situation similar to that in Chechnya when the Russians turned the gas off.
Barry Gardiner
The hon. Gentleman is right to focus on security of supply, which is an essential part of the future of the market. He said that the price of gas would go up and down in accordance with the cost of procuring it on the open market. Can he explain why the wholesalers who generate the electricity by means of that gas do not drop their retail prices when wholesale prices have dropped in the international markets?
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. May I remind those who continue to intervene that they will be placed at the bottom of the list rather than the top, because they have already spoken? I am sure that they will want to save something for their speeches.
Gordon Birtwistle
I take the hon. Gentleman’s point, and I agree with him. Maybe it takes a while for the price of gas to go down. Gas is bought in advance, and gas bought six months hence could be a lot cheaper than that bought now, but the expensive gas might have to be used up before the cheaper gas can be used. I do not know the gas market; I am only trying to make the point that we are in a world market and we buy in those markets.
As for the idea of pooling—a suggestion made by the Opposition Front-Bench team—who will be the suppliers? We do not know who they are. That is an issue, but the main issue is that we have to be able to understand the tariffs. I do not understand the tariffs. I have been with the same supplier since I signed up many, many years ago. I buy my gas and electricity from British Gas, because it tells me that I am getting the best deal. Every time British Gas changes the tariff, it tells me what the tariff is and assures me that, because I am a loyal customer, I am on the bottom deal. I have never checked: I believe British Gas and I accept what it says, because basically I cannot be bothered to have a look. However, at the end of the day, we have to resolve the issue by ensuring that the people who can be bothered have a chance to do that, if they are able. The collective switching arrangement that has been suggested by the Secretary of State is an extremely good idea—certainly the arrangement is extremely good for Cornwall, where everybody can take advice from a switching consortium, as is the arrangement taken up in Oldham only yesterday. Indeed, the same thing can take place right across the country.
If I remember rightly, many years ago we had things called co-ops. We used to buy from the co-operative, which had itself made purchases, with discounts given through the system. I remember that my mother’s divvy number was No. 50, and we got a divvy every year from the savings that the co-op had achieved by buying in bulk and selling to the general public.
In the time I have left, I would like to talk about the real way to save money on electricity: by using less. If people use less, they obviously pay less. I would like to mention a scheme from my constituency of Burnley, where well over 15,000 properties got solid-wall insulation from outside cladding. It was done in co-operation with the Government, British Gas and the registered social landlord that owned the properties, a company called Calico. I took great notice of what happened—it was the biggest scheme in the UK, I was told—and I have since followed it up and visited quite a number of people who had their properties done. I said to them, “Apart from the house looking a lot better than before—you’ve had the outside cladding done, your roof spaces all clad and all the new boilers fitted—can you tell me whether you have had a substantial change in your electricity bill?” The first gentleman I spoke to said to me, “The house is now so warm that I’ve persuaded my wife to turn the thermostat down, which in itself is a major achievement. I had my loft space insulated and my wife volunteered to turn down the thermostat, because it was now too warm to wear the extra jumper that she was wearing.”
When I asked people, “So have you found that by turning your thermostat down you have seen a major saving?” the answer every time was “Yes, and a substantial saving.” In one case, the gentleman had taken a note of the savings he had made, which were approaching 30%. No matter what tariff someone is on, no matter where they look for discounts and no matter what allowances are made for certain people, they will never, ever be able to get a 30% discount. The Government could not fund a 30% discount, the companies supplying the electricity could not give a discount of 30% and the tariff changes will never give a 30% discount. I believe that the way forward and the way to save money is to spend money on cavity-wall insulation—the outside stuff: I am not keen on filling the cavity with insulation, because that creates damp—plus everything that goes inside, plus the new high-efficiency boilers. That is why I welcome what happened in Burnley and why I welcome the new green deal, which will enable RSLs to provide such insulation on the properties they rent out, particularly in my constituency. I do not really accept that what is in today’s motion will change things.
Finally, on Ofgem, I have to say that I am definitely anti-quango. We have far too many quangos. The day we get rid of 90% of the quangos will be the day I can leave this place and say that I have really done something. However, we do not replace a quango that is inefficient with another quango. The way to do it is to get the existing quango to do its job. I hope that the Secretary of State will lean on Ofgem and make it do what it is paid to do and make it deliver to the general public what it is supposed to deliver. If Ofgem is not doing that, we should not change it, but get rid of the people in it who are not performing and replace them with people who will deliver what Ofgem is supposed to deliver.