Lord Grantchester
Main Page: Lord Grantchester (Labour - Excepted Hereditary)Energy Bill [HL]
Lord Grantchester Excerpts
Lord Marland
My Lords, we come to yet another huge group of amendments that the Government have tabled, which recognise the points made in debates in Committee and at Second Reading.
These amendments serve to clarify the powers currently set out in Clause 67. They pertain to the Secretary of State’s ability to transfer from “the Authority” to himself or another body the administrative powers and responsibilities for the energy company obligation. The authority is defined as the Gas and Electricity Markets Authority, the functions of which are presently carried out by Ofgem. The Government are currently reviewing the role of their various delivery bodies, including Ofgem, and it would be helpful to have powers already available that would enable us promptly to take account of the results of that review, thus ensuring certainty for those being regulated by the ECO.
In tabling this amendment, we are in no way prejudging the outcome of the review. This series of amendments refines the policy objective contained in Clause 67 by enabling the Secretary of State to transfer directly to another body, or to him, the functions currently performed by the authority. The refinement will preclude the need to make two sets of orders—one establishing the ECO and another moving some or all of the authority’s functions to another body or to the Secretary of State. The process for doing so has been streamlined. I beg to move.
Lord Grantchester
I thank the Minister for his explanation of what is indeed an extensive list of amendments that address issues touched on in Committee. The amendments are necessary to ensure that future recommendations of the Government’s delivery review can be implemented without unnecessary delay and without causing unnecessary uncertainty to those energy companies caught by the future energy company obligations. It is possible that the Government’s delivery review may conclude that administrative responsibilities for the ECO should be transferred to a body other than the authority, which is currently Ofgem. This series of amendments enables any future ECO to be administered by “the Administrator”. The amendments make the authority the default administrator but give the Secretary of State a power to transfer the administrative functions away from the authority and place them on another body, or to transfer the functions to himself. We are content with these amendments.
Lord Grantchester
“( ) in subsection (3)(g) after “consumers” insert “(including adherence to and independent Code of Practice for Installation).”
Lord Grantchester
With the permission of my noble friend Lord Whitty, I shall move his amendment. I pay tribute to him for his clear leadership on consumer interests. He has laid out in his amendment a very clear way forward regarding smart meters. I could not do justice to the exposition that he would have made far more adeptly than me. However, there is an important element that we should debate tonight and on which we should question the Minister on the way forward.
As we all know, there is considerable anxiety and resistance from consumers, arising by and large from misunderstandings over the operation of smart meters. However, smart meters offer the opportunity to reduce inaccurate bills to consumers, as well as to lower their costs. We had a full debate in Committee and wish to build on the positive discussions and proposals being considered with the Energy Retail Association and Energy UK, especially with regard to the code of practice. I know the Minister is also keen to bring in the benefits of smart meters in a constructive manner. He spoke in Committee of his dialogue with the energy companies, without saying exactly what he would do on this matter. This amendment would allow him to construct a good way forward. I beg to move.
Baroness Northover
My Lords, Amendment 157 draws attention to the need to ensure that the smart meter installation visit promotes consumer confidence and protects customers. We have already proposed to require suppliers to develop a code of practice governing the installation process and to ensure that the installation is not used for unwelcome sales activities.
Since the prospectus was published, suppliers have made good progress in drafting a code, with input from consumer groups and others. The smart metering programme has made it clear that the code will not be voluntary. We will shortly set out our detailed decisions in this area as part of the government response to the consultation. We have all the necessary powers to put the code in place, backed up by a licence obligation, under Section 88(3)(g) of the Energy Act 2008 as it now stands.
Amendment 158 in this group would require the Government to consult on a strategy to deliver the intended benefits of smart meters to consumers and to report on progress. Therefore, I assure your Lordships that the Government are clear that they are accountable for the successful delivery of the programme and its benefits. Indeed, this recognition was behind our recent decision that DECC would take direct responsibility for the next phase of the programme. We made this clear in announcing that decision in December, and it includes accountability for ensuring delivery of benefits.
However, provision in primary legislation is not required. Indeed, this provision would cut across the things that the Government are already doing to achieve the intent behind these amendments. The Government are already consulting on our strategy to achieve the benefits sought for the programme. As many of your Lordships will know, the Government published a prospectus in the summer last year containing a wide range of proposals for consultation. These proposals covered the policy design for the implementation of smart metering, including a wide range of proposals for the technical, commercial and regulatory arrangements required to deliver the benefits.
This has already been a very full and detailed consultation, with several hundred pages of published consultation documents. The prospectus was supported by two full impact assessments setting out clearly the benefits that we seek. We will shortly publish the conclusions of this process, which will confirm the Government’s strategy and plans. It would therefore be unnecessary to reconsult on this strategy and it would cast doubt on our conclusions to do so.
It is important to say that there will need to be further work to develop the benefits management arrangements and, crucially, the consumer engagement strategy. If necessary, we will bring forward proposals for changed or additional measures using the Secretary of State’s powers. It is also important that we have strong programme management arrangements, and that the measurement and reporting of benefits is robust and rigorous. We will set out how this will be taken forward. All these matters will be specifically addressed as the programme is taken forward by the Government.
I hope that the noble Lord will be able to assure his noble friend that much of what he is seeking is already in train and that his amendments would cut across that. I am sure that that is not what his noble friend intended. On that basis, I hope that the noble Lord will be willing to withdraw the amendment.
Lord Grantchester
I thank the Minister for her fulsome acknowledgement and exposition of where we are with smart meters and of everything that is going on within her department with regard to the industry. I shall certainly reassure my noble friend and he will enjoy the most fulsome remarks that she has just expounded. With that, I beg leave to withdraw the amendment.