Energy Bill [Lords]

Guy Opperman Excerpts

Wednesday 14th September 2011 Commons Chamber

[Mr Baron]

I thank the hon. Gentleman for making that point. I hope that there will be no discrimination in how the information is presented. It is as simple as that. Bills go out to everyone in the land, and the information would be pertinent on those bills. Again, the research would ensure that we reached all sectors of our communities.

[Guy Opperman (Hexham) (Con)]

Does my hon. Friend agree that the clarity of bill point that he is making eloquently and well would not necessarily be of use without clarity of ownership? He will be aware that a multitude of companies supply heating oil, which we debated in Westminster Hall in January this year, but the market is dominated by one monopolistic company—DCC Energy—which is being investigated by the Office of Fair Trading. Does he agree that the proposal should include clarity of ownership, so that proper price comparisons can be made?

--- Later in debate ---

[Caroline Lucas]

I thank the hon. Lady for that intervention. I welcome the fact that health and wellbeing boards are now interested in fuel poverty, although whether that will bring significant new resources into play is another question. I hope that the hon. Lady is right, but I am not convinced that she is, or at least that there will be enough resources without hypothecation of some of the revenue sources from emissions trading and so forth.

New clause 18 would allow fuel poverty and energy efficiency programmes to be better targeted at those in greatest need through the sharing of data between the Government and energy companies, with all due consideration for privacy and data protection issues. I believe that such improved targeting would also reduce wasteful administration costs, which have been estimated at about £120 per household. Money spent on trying to identify low-income and vulnerable consumers would be much better spent on helping them out of poverty.

I strongly support amendments 2 to 5, tabled by the hon. Member for Manchester, Withington and signed by me. I had tabled similar amendments to improve clause 42, but withdrew them to support those tabled by the hon. Gentleman.

[Guy Opperman]

It is no exaggeration to say that the citizens of Northumberland are often faced with a straight choice between heating and eating. I am lucky enough to represent 1,150 square miles of south and west Northumberland, and while in the rest of the country 6 million people—one in 10—may suffer from fuel poverty, it is well accepted in my constituency that the position is far worse there. The north-east has the second highest level of fuel poverty in the country, and we take the issue very seriously.

I support what the Government are doing in the Bill and with the green deal. It is a wonderful step forward. Listening to the hon. Member for Liverpool, Wavertree (Luciana Berger), one might have believed that nothing had happened since the present Government came to office, that everything had been rosy in the preceding 13 years, and that fuel poverty magically mushroomed out of nowhere in May 2010.

I want to discuss energy efficiency and fuel poverty in the context of new clause 19, which was presented very impressively by my hon. Friend the Member for Basildon and Billericay (Mr Baron). My constituency is particularly affected in the context of oil and liquefied petroleum gas, although we are obviously affected by other energy issues. I applaud all the efforts to improve the energy efficiency of homes through the green deal, but I am concerned about, in particular, the variances in the price of heating oil and LPG. We discussed the issue during an important debate in Westminster Hall in January to which a number of Members, including the hon. Member for Ynys Môn (Albert Owen), made impressive contributions. I hope that that debate is a source of ongoing development in relation not just to the Bill and the green deal, but to other proposals made by the Government.

Fuel poverty is not an abstract issue. It is talked of as though it affects other people, but account should be taken of the sheer increase in fuel prices. The price of heating oil in Northumberland, for instance, rose from approximately 41p to 71p in the three months between September and December last year. That is a massive price rise. Everyone accepts that prices are affected by consumption and by oil and gas prices generally, but there is undoubtedly an element of profiteering, and naked monopolies and cartels have been created by individual companies. We have campaigned strongly on the issue.

It is well known that I am no fan of the company known as DCC Energy. I am pleased to say that it is being subjected to an investigation by the Office of Fair Trading, which was launched on 14 March this year and will report in October. I hope very much that the OFT will fully address the difficulties that individuals face. I touch upon this matter because it relates to fuel poverty and energy efficiency. We in Northumberland have at least 20 or 21 fuel companies that provide heating oils and other products. If the practice had not been made public by Members and The Sunday Times—whose campaign I applaud and endorse—it would not be known that all but four of those companies are owned by DCC Energy. Long-standing customers of, for instance, a heating oil company that had been bought-out might be told, “We’re the independent and long-established company that you’ve always purchased from,” when that was manifestly not the case. That company is now clearly controlled by a parent company.

[Mr Weir]

That problem also arises in many other parts of the country, particularly in Scotland. The traditional response of Governments when asked to address the issue of tariffs was that there were too many suppliers, but it is clear that we are now moving towards a situation in which this market is controlled by just a few companies, as in the energy market, which is dominated by the big six. Does the hon. Gentleman agree that it is time that the Government looked at an equivalent to social tariffs in this area?

[Guy Opperman]

I would certainly welcome hearing what the Minister has to say on that. The point, however, is that there is regulation of the big six energy companies, but there is no regulation of the heating oil companies and others. I accept that we must wait until we know the results of the Office of Fair Trading investigation, however. After that, we might want to come back to the House and argue that changes must be made.

[Sarah Newton]

My hon. Friend is giving a comprehensive account of a problem that we in the west country also face, as there are very high levels of fuel poverty, which is related to the fact that so many people are off the gas grid, and they rely on heating oil and LPG, just as people do in my hon. Friend’s Northumberland constituency and in Scotland. As he says, we must wait for the publication of the OFT’s full findings at the end of the month, but does he agree that its initial findings were welcome in that at least there will now be clarity in respect of websites offering people advice on where to purchase their heating oil? Thanks to the intervention of Members—and especially the Minister, who asked the OFT to look into oil supply as part of the off-grid energy review—this winter, when prices are rising and people are increasingly concerned, at least accurate and fair information will be available on where to purchase heating oil.

[Guy Opperman]

I agree with all those points and applaud the efforts of the Government, and especially the Minister, in pursuing the point about websites. One such site, BoilerJuice, is supposedly a price comparison site yet is owned by one company—DCC, unsurprisingly —and it markets only the products it owns. That is manifestly unfair and wrong; it is not good for either the consumer or our constituents in general. I endorse the OFT response, and it is to that company’s great shame that it behaves in that way. I welcome the actions of the Minister, the OFT and especially The Sunday Times, which has done much to help tackle what is, frankly, a scandal.

The message must go out that this issue is about not only what the Government can do through the Bill and the guidance they issue, but about the fact that our constituents must ask questions and shop around as well. They will not be able to do that unless they know who owns the business that is supplying them with fuel or heating oil. If they do not have such information, they will be subject to what amounts to a monopolistic cartel. That is manifestly wrong. We cannot do all the work, however; people must address this issue themselves as well. We have to sell that message to them.

[Sarah Newton]

My hon. Friend is being very generous in giving way. Does he agree that there are some very good initiatives in which communities are gathering together to form co-operatives? In villages, people join together, often enabled by voluntary organisations such as Community Energy Plus in Cornwall, to get a better deal for customers in their villages.

[Guy Opperman]

I totally endorse that. In certain areas in Northumberland, such as in the communities of Tarset and Allendale, similar approaches are being pursued by local communities’ grouping together and purchasing from a local supplier. In my area, we thought we had 21 different companies but in fact we have one company masquerading as 17 providers and four independents. Fortunately, the four independents have been identified and should be supported; indeed, I assure hon. Members that they will be supported because of the way they are trying to do business and support the local economy and are not an Irish-based provider in a cartel.

Following on from the community projects we have been talking about, I endorse the work of organisations that have addressed this issue and worked to improve the position for the individual consumer and constituent. To their great credit, Age UK and the National Farmers Union have done tremendous work to address the matter. It is worth noting that of the 10 things most likely to be stolen in thefts and burglaries of people’s houses, the sixth-highest is fuel—in Northumberland, the figure is probably even higher. The Countryside Alliance should also be complimented because the rural action that it has proposed is massively successful; it is identifying ways in which the community can be assisted, and not just in farming communities and market towns. In my constituency there is no question but that fuel poverty is an issue in residential parts of places such as Prudhoe, Haltwhistle and west Wylam. Those are not areas of farmland and sheep—they are nothing other than normal houses where people are struggling to stay above the fuel poverty line.

Today, I met representatives of the Young Foundation, which supports The U—a citizens’ university-based organisation in Hexham that is working for specific energy efficiency projects. Those projects are just the sort of thing that will benefit from the green deal in future. They, along with the Green Alliance and several Members of Parliament, are working together to try to provide flagship examples and leadership for the type of constituency and community that is putting green policies at the heart of the community. There is great scope for a community-based way forward to try to strengthen our ability to address energy efficiency.

I support the Bill, but I want to touch briefly on new clause 19, which was tabled by my hon. Friend the Member for Basildon and Billericay. It will be no surprise to hon. Members who have listened to my contributions to hear that I should like to see clarity of provider ownership on bills. At the moment, individual consumers are being misled by their failure to understand which parent company owns particular providers. I accept and endorse my hon. Friend’s comments that new clause 19 is a way forward. It addresses the additional information that should be supplied by energy suppliers on bills and I hope that the Government will support it. It is supported by Which?—an organisation that self-evidently works on behalf of individual constituents and consumers—and a number of other organisations that are greatly to be credited. Anything that ensures that a generic signposting message is displayed prominently on all customers’ energy bills, detailing how they might reduce those bills, should go ahead. We should ensure that such messages are on bills. Indeed, I go further in saying that it would be of great benefit if something were supplied on that issue this year, although I accept that it might be difficult to do that by 1 December given the bureaucracy involved.

I should like to have seen a further subsection added to new clause 19—it is to my detriment that I failed to table an amendment to it—that would have touched on clarity of ownership, but perhaps we can return to that after the OFT has produced its report, when we know what it says about the role of DCC Energy.

I support the Bill and the green deal. The constituency that I represent and the whole of Northumberland is well behind the green deal and the objectives that it seeks to achieve.

[Albert Owen]

It is a pleasure to follow the hon. Member for Hexham (Guy Opperman). I welcome him back to the House. He is in good campaigning mode on fuel poverty and off-grid fuels in peripheral areas of the United Kingdom. I support new clause 1 and the other Opposition new clauses and amendments, but I shall limit my remarks to new clause 19, tabled by the hon. Member for Basildon and Billericay (Mr Baron). He highlighted in his opening remarks how important energy issues are to households and how the price hike of recent months and the trend that is forming are hurting every household in the United Kingdom. That is something that we need to address.

Good measures have been taken by previous Governments and, indeed, this Government with social tariffs, but the market simply does not work for many people. The price hikes are unsustainable, hurting and causing fuel poverty across the country. I welcome new clause 19 when it talks about clarity and simplifying bills, so that people have ready information.

I am glad that the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker) is still on the Front Bench. He is on record as saying that he was so confused by the information available when he tried to switch supplier that he just gave up. I am in the same league as him. Energy companies deliberately give so much information to their potential consumers and customers that they do not bother.

I am a member of the Select Committee on Energy and Climate Change. We have held a number of inquiries and a mini-inquiry when price rises were announced just before the recess. We took evidence from three of the big six companies. There has been a review and there will be further reviews of energy pricing and tariffs and how the companies present their bills. It was interesting that 40% of those who decide to switch supplier are no better off when they do so, and many of them do so under duress; they switch just to get rid of cold-callers. So it is important that we have such a clause as well as other legislation and regulations that allow individuals to have clear and concise bills, so that they can make clear and concise choices and, we hope, reduce their energy prices, thereby reducing fuel poverty.

We will extend the retail market inquiry being undertaken by the Department of Energy and Climate Change to find out more from experts, including consumer groups, which have been helpful. I join hon. Members in putting on record my appreciation of the work done by consumer groups, such as Which?, Consumer Focus and Citizens Advice, in helping to frame proper protection guidelines for energy consumers.

The confusion needs to be addressed, and new clause 19 would go some way to doing so. When I intervened on the hon. Member for Basildon and Billericay to ask whether he would expect the measure to be extended to people off-grid and not on the mains, he said that he would. Of course, such an extension would be difficult because, as has been said in the previous contribution, the off-grid is not a regulated market. I am not sure—I am willing to take an intervention—how he envisages that independent suppliers would do what would be required of the big six, with dual tariffs and so on. Obviously, people without gas supplies cannot get the dual tariffs or other reductions that many people have.