Energy Price Support: Northern Ireland

Debate between Kevin Hollinrake and Paul Girvan

Wednesday 16th November 2022 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)]

It is a pleasure to speak with you in the Chair, Sir Gary. I congratulate the hon. Member for North Down (Stephen Farry) on securing this very important debate, and I thank the hon. Members for Strangford (Jim Shannon), for Belfast South (Claire Hanna) and for South Antrim (Paul Girvan) for their interventions. They all made important and salient points relating to the problem in Northern Ireland.

Given the record energy prices, the Government understand the pressures being faced by households and businesses in Northern Ireland and right across the United Kingdom, and we are taking direct action to address the issue. Clearly, the crisis has been driven by Mr Putin’s illegal invasion of Ukraine, which has caused a surge in the global price of wholesale gas, leading to an unprecedented increase in the amount that households and businesses are paying for the gas, electricity and oil they use. This has compounded already high prices in economies across the globe that are recovering from the covid-19 pandemic. The effects of the price rises are being felt up and down the country, but the Government are determined to ensure that families can provide power for their homes and that businesses can power the economy.

[Paul Girvan]

While we have been sitting here, I have taken the opportunity to check on today’s oil price. In England, people can buy a litre of 28 kerosene for 85.9986 pence, but the current price in Northern Ireland is £1.0835—a difference of 22 pence. How can we address the imbalance in transporting oil from GB to Northern Ireland? We have no refinery in Northern Ireland, and no way of dealing with it.

[Kevin Hollinrake]

The hon. Gentleman makes a very good point, and I heard his comments earlier about the increased price of oil in Northern Ireland. The hon. Member for North Down spoke of the very high number of households in Northern Ireland that are off-grid, and that is extremely important. I will try to cover that point in my remarks.

The announcements made by the Government in September demonstrated our commitment to protecting UK households and businesses through the energy price guarantee, the energy bill relief scheme and the energy bills support scheme, which is the key matter under discussion. Under the plans, households, businesses and public sector organisations across Northern Ireland will be protected from significant rises in energy bills, thanks to the Government’s support. As well as outlining the support that still needs to be delivered, I will set out what the UK Government are already delivering in Northern Ireland, and what is to follow shortly.

The energy price guarantee in Northern Ireland launched on 1 November, offering equivalent support to that provided in Great Britain for domestic households. The scheme reduces the price that energy suppliers charge customers for units of gas and electricity, providing money off energy bills. Households will receive backdated support to cover October 2022 through a higher discounted rate. Through the EPG scheme, a typical household in Great Britain with both gas and electricity contracts will save around £700 this winter, based on current prices. Equivalent support will be provided for households in Northern Ireland.

Government support will also be provided for households that use alternative fuels for heating, such as heating oil or liquified petroleum gas instead of mains gas. The alternative fuel payment scheme will provide a one-off payment of £100 to ensure that all households that do not benefit through the energy price guarantee receive support for the cost of the fuel they use. The £100 payment has been calculated with reference to increases in the cost of heating oil between September 2021 and September 2022. The aim is to ensure that a typical customer using heating oil will be offered support that is broadly in line with that offered by the energy price guarantee for those using mains gas to heat their homes. However, I hear what hon. Members say, and we are monitoring the price of heating oil and other alternative fuels very closely, now and in the months ahead, to see whether further payments are required at a future point in time.

Households in Great Britain that are eligible for the payments will receive £100 credit on their electricity bills this winter. For Northern Ireland, the Government are working with electricity suppliers to explore how the payment could be delivered via electricity bills under a similar delivery model. Details of when the payment will be made will be confirmed shortly—we have heard that word a number of times from Ministers at the Dispatch Box—so I cannot give the hon. Member for North Down a firm date, but we are very keen to deliver it as quickly as possible.