Energy Bill [HL]

Lord O'Neill of Clackmannan Excerpts

Wednesday 19th January 2011 Grand Committee

[Lord O'Neill of Clackmannan]

The attraction of this amendment is that it affords flexibility. A range of options will be available and, if an assessment is being done, it would be sensible to have a clear list. Let us face it, there may be a number of people who, having become interested in the Green Deal, will be able to purchase some of the items that are outwith the terms and purposes of the Green Deal but which might come cheaper if they get the whole job done at the one time. If a tradesman is visiting a house, it could involve just one visit and a person would have to pay only for another hour. Other pricing mechanisms might involve a second visit, with the first hour costing so much, et cetera.

It is important that we get an idea of the ideal deal as well as the Green Deal so that we can see all the requirements of the household and so that, when the assessment is done, the individuals, within the criteria of the Green Deal, are able to pick and mix. Within certain guidelines and appropriate standards, we should provide a range of options. This amendment may be unnecessary, but I would hate to think that this deal, as I have already characterised, is perhaps in reality more limited.

The Minister and I were not quite in dispute, but he noted his disagreement with me when I said that a number of properties will probably be too expensive to fall within the Green Deal. I identified the solid-wall rural household outwith the gas network, which would be very difficult to fund. The savings may not be sufficiently large to make the loan repayable over a 15-year period, but that should not mean that at least part of the work could not be done in the household under the Green Deal.

If people have enough money, they could take on a private financial arrangement with a bank, add to their mortgage or do whatever to carry out the other improvements. It would be helpful if the Minister could indicate whether he envisages the system being, in the first instance, capable of accommodating a whole list of possible options and being sufficiently flexible before the contract is signed to include some of the options, if not all, on the original list. The system should allow the individual, if they see fit, to have the other works done at their own expense and paid for by whatever means they can privately arrange, whether that be the credit card, the bank loan, adding to their mortgage or simply hard cash.

If we had that, we would get a clearer idea of the potential for flexibility. We do not want so much flexibility that people could be ripped off by cowboys, but qualified tradespeople, good assessors and a wide range of options would be a selling point for the Green Deal. That will not do everything, but it will help. It will perhaps free up resources for people so that they can do the things that they would like to do but otherwise might not consider to be a possibility.

[Lord Moynihan]

My Lords, as one who enjoyed spending Monday night in your Lordships’ House reading through every clause, including the details of the impact assessment, the Explanatory Notes and everything that goes with the Energy Bill, I may have overlooked something but I think that my noble friend’s point is, in effect, already answered. A request to list all the energy efficiency improvements that may or may not fall within the Green Deal would be fairly simple because it is already covered by the Bill. It was made clear by the Minister that under Clause 1(4) there would be an order made by the Secretary of State setting out the qualifying energy improvements. Anyone would be able to see those energy improvements. We would be at risk of repetition if we were now to add into this clause, and lift from the order, all those improvements that would qualify under the Green Deal.

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[The Deputy Chairman of Committees]

Time is up. I suggest that we resume.

[Lord O'Neill of Clackmannan]

My Lords, on a point of order. I do not know if one can do this on this Committee, but we are breaking for 10 minutes but the vote has not finished yet. I realise that you have exercised a degree of flexibility, but we are going to have a number of Divisions. Surely we should have breaks commensurate with the length of time it takes for the Division to be held and announced next door, because, at the moment, we are having a Division on closure followed by a Division on substantive amendments, and the two follow one after the other.

[The Deputy Chairman of Committees]

I appreciate that. I am afraid that I had to call the noble Lord, Lord Marland, between the two Divisions. I recognise that there is a problem when we get Divisions back-to-back like this. I have given some leeway; I gave about five minutes on the last Division.

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[Lord O'Neill of Clackmannan]

My Lords, will the noble Lord bear in mind that these same electricity and gas companies have the postal codes of their consumers, and that it does not take a computer genius to link the postal districts with areas of great disadvantage and social vulnerability? It is quite clear that there are a number of people in second homes who find it very convenient for understandable reasons to have prepayment meters. However, the argument advanced by the energy companies that they do not really know who the poorest people are, is self-serving, because they make a lot of money out of charging a higher rate for these meters. It has been one of the great sources of antagonism for many of us against the power companies, that they have disadvantaged people who are already vulnerable. The ones who have second homes we can understand; but the correlation between the postal codes of poor neighbourhoods and the fact they are on prepayment meters is simple to establish, but they never want to do that because they hide behind so-called Freedom of Information provisions, which I do not think stand up to close scrutiny when they are set against the disadvantage of the people exploited by this form of charging, in many instances.

[Lord Jenkin of Roding]

The noble Lord is perfectly entitled to make his point, but it does not refer to the point I was making. My point was that, yes, prepayment meters are used by many poor households and of course the gas and electricity companies have a very clear idea of who they are. Under the previous arrangements, they had to get 40 per cent of their carbon dioxide savings from people in that priority group, so they had to find out who they were, however difficult it was. That is not the point that I was making; my only point was that the presence of a prepayment meter in a dwelling is not of itself a good surrogate for who is fuel-poor. As the noble Lord himself has recognised, there may be many people with second homes; there may be people doing short-term lets who prefer to put in a prepayment meter, but whose tenants, the bill payer, may be miles from fuel-poor, but that is one of the ways that a landlord can make sure he is not landed with a bill at the end of the day. It is just not accurate to say that all prepayment meter households are inevitably fuel-poor or poor. They are not, and I think it is very important to recognise that fact and not take refuge in abusing the companies, which the noble Lord is so fond of doing.

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[Baroness Maddock]

An amendment of mine is in this group. I support what has been said about the importance of looking at how successful things are and looking year-on-year at figures. Mine is a more general measure. Indeed, I had placed it much further on in the Bill, but it was obviously seem to be convenient to debate it at this time; I do not mind that. Mine is about the assessment of the costs and benefits of energy saving, as opposed to those of energy generation.

Energy saving is universally acknowledged on all political sides to be the cheapest and cleanest way to achieve our energy policy objectives. That view is behind the Green Deal. As I understand it, an assessment of the costs and benefits of investment in energy generation capacity compared to the costs and benefits of demand-reduction policies has never been carried out. As noble Lords have said, I have been involved in the area for a number of years and have worked closely with the Association for the Conservation of Energy. I therefore know that it has pursued the issue but has never received a satisfactory answer. Over the years, as I have looked at, sat through and taken part in all sorts of legislation—a lot of it reforming legislation—I have learnt that reviewing and taking note of what has happened before moving on to the next piece of legislation is something that Governments seem to be bad at, particularly in the area of energy efficiency.

That is important when you have a lot of sceptics around and people argue about what is the best way to do things. The European Climate Foundation reports that emissions from buildings can be reduced by 95 per cent. It breaks it up into a 40 per cent as a result of reduced demand and 45 per cent as a result of the electrification of heating. Its predictions of energy efficiency mean that overall electricity demand increases only by about 40 per cent with full electrification of heating and, largely, of transport. That is in stark contrast to DECC figures, which predict a doubling, and possibly a tripling, of UK electricity demand. It is therefore important, when debating an Energy Bill, to consider that.

I hope that I can get a positive response from the Minister that he will take the issue seriously. I am not saying that the amendment has to be in the Bill in this form, but it is an important issue—particularly now that we are moving ahead with the scheme.

[Lord O'Neill of Clackmannan]

I support the amendment. We have had repeated statements from the Minister to the effect that, in many ways, the Green Deal will be market-driven, that there is little public funding but that there is a great deal of public provision, in the sense that the Bill will mark the paving of the way for the Green Deal. I think that, therefore, it is important that there is a degree of public reporting of what we are trying to do so that we can measure its effectiveness, whether in environmental terms or the penetration—which parts of the country respond better. We would anticipate that continuing for many years, so it would be desirable for us to have proper indications of take-up rates, the environmental impact and, in particular, who is getting it and where they stay. While we are not asking for a street-by-street report, it would be useful on a regional basis or a local authority basis to get an indication of what is happening. It might even be useful to see the take-up within the devolved Administrations and see whether they are playing their part alongside the Whitehall-driven part of the exercise.

I take the point that the first line of defence of most Ministers, when faced with amendments which seem to be rather good in intent, is that the wording is wrong, or it is not properly drafted. That is why the ministries have masses of civil servants; not necessarily to do the drafting themselves but to instruct those who do it to do so. Therefore, before we get any feeble excuse that it is not properly worded, many of us would be very happy if the Government were prepared to take the amendment away, look at it in some shape or form, and see whether we can achieve that. As we have said in respect of so many aspects of this Bill, while it is very ambitious and wide-ranging, it is not rocket science. This information will be held somewhere. It is just a question of making sure that we can get it from that somewhere into the public domain so that on a draughty Friday morning we can have one and a half hours of debate on it in order to subject the whole proposal to some kind of public scrutiny and public accountability. While we might not be spending much public money on this, we are going to be investing a great deal of, I think, Westminster prestige. There is not a lot of that going about at the moment, but what is there, if it is to be effective in this instance, ought to be reported. If it is not as effective as it should be, we ought to be doing something about it, not on the basis of prejudice but on the basis of hard information, which I think a report of this nature would provide.

[Baroness Maddock]

My Lords, I suggest that, if we were not repealing the Home Energy Conservation Act, it is precisely under that Act that the figures could be got together by local authorities.