Energy Prices Bill

Helen Morgan Excerpts

2nd reading
Monday 17th October 2022 Commons Chamber

[Helen Morgan (North Shropshire) (LD)]

I am most concerned about what is missing from the Bill, particularly the lack of support for those in rural areas who are off the gas grid and rely on heating oil or liquefied petroleum gas. As an off-grid homeowner, I can verify that the cost of heating oil has almost doubled since this time last year, meaning that the average off-grid household is spending £1,200 more than last year to heat itself. I am afraid that £100 will not go near helping those families who are struggling to make ends meet in rural Britain. Beyond that, the scheme is confusing. It is unclear how consumers will be able to prove that they are eligible and submit a request for the grant to be applied to their electricity bills.

However, it is not just rural off-grid households that are struggling, as I am sure a number of Members will testify this evening. Many on-grid users are also feeling the squeeze, given that £2,500 for an average household is still almost double what it was paying this time last year. Today Cornwall Energy predicted that next April bills would be more than £4,300, over 70% more than households are paying this year and more than 3.5 times more than they were paying last year. What will the Chancellor be saying to the millions of people who are worried about their energy bills next year, despite the Government’s promising them certainty. How will he help those who, while also dealing with spiralling mortgage costs, will struggle to make ends meet? The Government could have provided much more responsible assistance by extending the windfall tax on the oil and gas giants which continue to rake in extraordinary profits at the expense of British consumers, instead of botching a Budget and leaving taxpayers and mortgage holders to pay for this mess for years to come.

The Government have also failed to take any steps to encourage reductions in energy use. Last week’s flip-flopping on the most simplest of options, a public information campaign on energy efficiency, highlights just how chaotic the plan for this winter is. The Conservatives have scrapped energy efficiency schemes, despite UK homes being the least efficient in Europe, and have reduced the standards for new homes, which means that 1 million homes have been built since 2015 to lower standards than before. Insulating homes is an important, practical step that would have helped people to help themselves. Also missing is the certainty that is needed for businesses to plan for the future. Six months of assistance is welcome, but, as with the rest of this Bill, it does not go nearly far enough. If the Prime Minister wants to promote economic growth, she must recognise that stability and certainty are vital preconditions for businesses to invest. This assistance is too little, too late: many businesses have already closed, and many more do not see how they can operate beyond the winter.

The need for large-scale intervention to prevent many households from facing unimaginable difficulty this winter is beyond dispute, but the Government have made the choice—the wrong choice—to allow heating costs to double while refusing to properly tax the eye-watering profits of oil and gas companies.

Energy Prices Bill

Helen Morgan Excerpts

Committee stage
Monday 17th October 2022 Commons Chamber

[Guy Opperman (Hexham) (Con)]

We—both this country and the entirety of Europe—are in an energy price war. It is an honour and a privilege to speak in support of this Bill and to make my first speech from the Back Benches in, I think, about seven and a half years.

It is unquestionably the case that I support the key measures. It is quite right that we support households up and down this great country, who are facing such difficulties over the next year. The measures come on top of the £37 billion package brought forward by the previous Chancellor bar one in spring this year, which offered £400 in support to every household in October, and the £1,200-plus support for the most vulnerable, including pensioners, who are particularly supported by that.

I have three points. First, I urge the Government, as I urged the Prime Minister and the then Chancellor of the Exchequer last week in questions on the Floor of the House, to conduct a communications campaign to send a message out to households and businesses about the nature of the support and how they could save money on an ongoing basis.

That is not the nanny state; it is outlining the support that people can take advantage of, and I urge the Secretary of State and the esteemed Minister to take that forward. Doing so will save the state money, because the state is subsidising the energy consumption of people up and down this country. If there is less usage, the state needs to provide less subsidy, providing savings to the Chancellor. Surely that is both self-evident and a self-fulfilling prophecy of reduction in expenditure.

Secondly, there is genuine concern about the proposed contracts for difference for biomass, given that there is already a renewables obligation subsidy that expires in 2027. I hope that the Minister will address the question of a severely subsidised biomass sector competing for timber and forestry with a non-subsidised sector that struggles to compete in those particular circumstances. I hope he will give some assurances on that.

Finally, I urge the state to follow the precedent enjoyed by Germany, Italy, France and other countries that have embraced energy saving on a much wider basis than we have here. You will be aware, Mr Evans, that in the House of Commons some rooms are heated to 30°. That is utterly ridiculous. In Germany and France, they do not heat their buildings to more than 19° and they have proper localism to drive forward energy reduction. They do not light buildings at night and they turn off hot water on a regular basis. Why does that matter? It matters because potentially they can save 2% of their energy consumption. We need that sort of leadership from the Government on energy consumption. I hope that as this matter progresses, the Minister and the Secretary of State will go away and consider how we can have either direction by the state or empowerment of localism so that our local public sector institutions, which are paying the most on energy, can be encouraged to reduce their expenditure—which, after all, is in all our interests.

[Helen Morgan]

I will not speak for too long, but I want to draw attention to the amendments tabled in my name, which I would have liked to see incorporated into the Bill.

One of my greatest concerns about the support available is for non-domestic users, which have only been given six months of certainty. As I alluded to on Second Reading, businesses need certainty to be able to plan ahead and invest. We also have local authorities raising distress calls about their budgets. To enable them to plan for the future, I would have hoped to see two years of support. That is why I tabled amendment 5. For the same reason, I support new clause 18, which provides support for non-domestic users.

Non-domestic users who signed a fixed-tariff agreement between December 2021 and April 2022 have also been left high and dry by the Bill. Amendment 7 would ensure that they also benefit from capped energy charges. Again, I draw Members’ attention to the plight of local authorities, many of which are struggling to balance their budgets for the remainder of the year.

Many businesses in my constituency are off grid, as everyone will be aware, and some of them are not covered by the energy bill relief scheme, so amendment 6 would provide them with support that has parity with that given to other non-domestic users. I urge the Government to consider that because rural businesses are up against it and struggling to see a way forward.

That brings me to off-grid homes, which have been hardest hit, but the Bill provides only £100 of support for them. People living in rural areas are hit hardest by the cost of living crisis. Not only might they be off grid and living in an older, poorly insulated home, but they face higher fuel costs to move around and higher food costs at supermarkets, so £100 of support is not enough. As I have mentioned, their heating bills have risen by about £1,200, so new clause 12 would ensure that those off-grid homes received energy cost support equivalent to those who are on grid, and amendment 9 would ensure that such payments were made directly to their bank accounts, making it easier for them to access that support. These changes would support the rural areas hit hardest by the cost of living crisis and would stop people being penalised for the misfortune of being off grid.