Off-grid Homes: Energy Support

Debate between Graham Stuart and Victoria Atkins

Wednesday 19th October 2022 Westminster Hall

[Graham Stuart]

As ever, my hon. Friend is absolutely right, and has gone to the heart of the issue. The Government recognise and understand the pressures that people are facing with the cost of living. This is a deeply worrying time for many of our constituents, and we will continue to listen to their concerns, which have been well expressed by many colleagues today.

Wholesale energy prices have been rising due to global pressures, and the UK is hardly alone in feeling the pinch. It is important to recognise how significantly this Government have stepped in. Back in May, £37 billion of support was announced, which altogether means that the most vulnerable households are receiving £1,200 a year—£100 a month—before we get to the energy price guarantee and the alternative fuel payments. It is important to put that on the record. There is a lot of support for all of our more vulnerable and rural constituents. The hare that is running—and this has been repeated by my hon. Friend the Member for Brecon and Radnorshire today—is that it is inequitable. On the face of it, that £100 intuitively does not feel right. However, I will take colleagues through the numbers and explain why there is equity, while also recognising the issue of monitoring. That is important, and the Government are going to monitor the situation going forward.

Heating oil prices have risen more than prices for other alternative fuels such as coal, biomass and others. The Government have picked a point in time; we looked at what the situation was going into winter last year and compared it with this year—then we have sought to provide protection. We have looked at the numbers for September last year to September this year. LPG, coal and biomass have risen less than heating oil. The average price of heating oil in September 2021 was 40.6p per litre in Great Britain. A year later, that average price is 100.3p. For those colleagues who have talked about a 60% rise, it actually comes to a 147% rise. The average use of heating oil over a year is 1,514 litres; that used to cost £615, but has gone up to £1,415. That has a serious impact on those with the least. I have already talked through the £37 billion package. The difference in the current bill is around £100—that has been the rise.

The cost of heating for the average on-grid home would have increased by approximately 220% in that same year to October. The energy price guarantee lowers that increase, through unparalleled Government intervention to support people, which I think we can be proud of and should do a better job of trumpeting. Over the same period the price of heating oil rose by 150%. It has been dampened by the EPG for on-grid homes to 130%. Probably due to market competition and lack of Government intervention—I am not saying that that is the only explanation—heating oil rose by 150%. That is where the £100 comes in. I beg colleagues on all side of the House to stop the hare running; there is comparable support. I can say that as someone with many oil-heated and LPG homes in my constituency; it is comparable.

The question is about going forward—what if prices spike? That is why, quite rightly, colleagues have pressed me and the Government to monitor the situation and to be prepared to intervene if necessary. I cannot pledge precisely that that intervention would happen, but we are going to monitor the situation with a view to being able to intervene if necessary and maintain the equity that I assure colleagues is in place.

[Victoria Atkins]

I thank my right hon. Friend for putting that explanation on the record. The £100 figure has been totemic. As that is a very technical response, it would be ideal if he were able—with his copious free time—to provide us with a “Dear colleague” letter that we could all share with our constituents. I also acknowledge the enormous help that the Government have provided to people on the grid. The energy price guarantee and the vulnerable household payments that the Minister set out are incredibly helpful. The next question I am bound to ask—I sense some parliamentary questions—

[Victoria Atkins]

I apologise, Mrs Murray. When will the payment be made?

[Graham Stuart]

Let me return to my scripted speech, which I seem to have entirely ignored so far, and hope to get to that answer. The energy bill support scheme—there are so many; I struggle with the acronyms myself, and I am responsible for them—provides £400 per household to assist with the cost of rising energy prices and in most cases is being delivered automatically through domestic energy suppliers.

There is a small proportion of households, including off-grid homes, that will experience increased energy costs but do not have those domestic energy supply contracts. I assure hon. Members that the Government are committed to ensuring that they receive support for energy costs. We are working rapidly to ensure that off-grid households will be able to apply for the scheme. We do not have a centrally controlled society. We do not have a database of everybody—they are not forced to register—so we are finding practical ways and looking to find designated parties to help to administer the scheme, and to do so in real time, this winter; having a perfect system next winter is of no help to people who need help now.