Fuel Poverty and Energy Efficiency

Mark Reckless Excerpts

Wednesday 16th January 2013 Commons Chamber

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

I am grateful to the Opposition for this opportunity to set out the many things the Government are doing this winter, and in the winters to come, to help people to keep their energy bills as low as possible and to keep their houses warm. I am under no illusion about how hard it is out there this winter. Times are tough, many people’s incomes are not going up, and the cost of necessities such as food is rising. I understand that higher energy prices are hitting some people hard, so let me make it very clear that rising energy bills are one of my greatest concerns.

We need to set the story straight on why energy bills have been rising. They have been driven remorselessly up by wholesale fossil fuel prices, as the right hon. Member for Don Valley (Caroline Flint) admitted. Global gas prices were 50% higher in the five years to 2011 than in the previous five years, and they have continued to rise. Sustained higher world oil and gas prices have taken some by surprise because, in the past, prices have fallen when the developed world has experienced recession and low growth. But today, probably for the first time in modern history, the fast-growing economies of China, India, Brazil and other parts of the emerging world are all demanding oil and gas. So world oil and gas prices have remained stubbornly high, and are likely to remain high.

[Mark Reckless (Rochester and Strood) (Con)]

My right hon. Friend referred initially not to rising oil and gas prices but to rising fossil fuel prices. Is it not the case that, although coal prices have fallen significantly, we are seeing no benefit from that because we are closing coal-fired power stations, including Kingsnorth in my constituency on 17 December, because of an EU directive?

[Mr Davey]

My hon. Friend is not quite explaining the situation fully. There is an awful lot of coal being burnt in this country and elsewhere, because of its low price, but that has not changed the picture because of the high price of gas.

Britain cannot control the global market. We cannot drive down international wholesale prices, but we must still do everything we can to help the people and businesses facing those rising global prices, especially the most vulnerable and those in fuel poverty—and, despite what the right hon. Member for Don Valley said, we are doing that.

Government policy is designed specifically to drive a wedge between global energy prices and energy bills, now and in the future. It is designed to enable us to cushion and insulate people from the hikes in global fossil fuel prices as best we can. The coalition has a plan to tackle ever-rising energy bills. When the Labour Government were in power, they talked big but did very little. They did not effectively target help on those who needed it most, they did not establish a new market in home energy efficiency and they did not reform the electricity market. We are doing those things. We are acting, whereas they just talked.