Oral Answers to Questions
Miatta Fahnbulleh Excerpts(6 days, 7 hours ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
We know that people are worried about their energy bills, and that too many are struggling to afford them. We agreed £500 million of industry support, alongside our warm home discount, to ensure that £1 billion of support was available for households struggling with their energy bills this winter. We will continue to take action to support consumers in the short term, as we sprint towards clean power in order to bear down on energy bills for good.
Sarah Edwards
In my constituency, a local hospitality business’s energy provider, E.ON, has behaved appallingly by back-billing and incorrectly billing, leaving that business nearly bankrupt. While I welcome the new expanded remit of the Energy Ombudsman, we need to ensure that it has the capacity and powers that it needs to protect businesses. Would the Minister meet me to discuss this case, and what are the Government doing to ensure that our local businesses are not driven to bankruptcy by the outrageous behaviour of energy suppliers?
Miatta Fahnbulleh
I am happy to meet my hon. Friend to discuss this case. However, there are clear rules in place to protect consumers from unfair back-billing, and energy companies must comply with those rules. I have met Energy UK, the industry body, and Ofgem to reinforce our expectation that if rules are not complied with, Ofgem will take enforcement action. The broader point is that we have to ensure that the energy market is working for consumers and is fair. We are reviewing Ofgem to ensure that it has the mandate, the duties and the powers—including the Energy Ombudsman—that it needs to be an effective and strong consumer champion.
George Freeman (Mid Norfolk) (Con)
For the record, I and my constituents are proud of the southern North sea development—the largest wind farm in the world, begun under the last Government. However, we are not happy about this Government’s rush to force our consumers to pay higher bills; to see, as a result of vast subsidies, farmers in a very important agricultural area of Norfolk farming solar panels, rather than the food that we need to ensure affordability and our security; and to abandon agricultural leadership on net zero. Can the Minister reassure my consumers that £250 is adequate compensation for higher bills and the defoliation of a large part of Norfolk? That is what has happened in the rush towards ill-thought-out net zero targets, set in London, without any consideration of local people.
Miatta Fahnbulleh
The past few years have shown us why we must break our reliance on global fossil fuel markets. Under the hon. Gentleman’s Government’s watch, energy prices spiralled, and consumers across the country paid the price. That is a reality that Opposition Members were happy with, but it is not a reality that we think is tenable, so we will sprint to clean power, because that is the route by which we achieve energy security for the country, and financial security for families. We are on the right side of history, and on the side of consumers. Opposition Members are deluded.
Chris Webb (Blackpool South) (Lab)
In Blackpool, we have more than 250 charities that are doing incredible work supporting people with their mental health, in getting back to work, and also with the cost of living, but too many people tell me, week in, week out, that they cannot afford to pay the bills. What conversations has the Minister had with energy companies about supporting these charities? Will she agree to meet me to discuss this important issue?
Miatta Fahnbulleh
My hon. Friend is absolutely right: charities and third-sector organisations play a vital role in getting support to households, which we know are struggling with bills. Part of the reason we thought it was so important to agree £500 million of industry support was to make sure that we got additional support to households. We are also consulting on extending our warm home discount to 2.7 million more households, so that more than 6 million people get help. We will work with the energy sector to make sure that we use the vital network of charities to get that support to the households that need it.
Richard Tice (Boston and Skegness) (Reform)
The price of gas is some 20% lower than it was at the beginning of this year, and the Secretary of State promised that bills would come down. Can the Government say when bills will come down for consumers, given that they are going up by 6% on 1 April?
Miatta Fahnbulleh
I encourage the hon. Gentleman to check his facts. The price cap went up, which was disappointing for families, because of the spike in wholesale prices. That is because of our reliance on global fossil fuel markets. [Interruption.] I will say it incredibly slowly for him, so he can understand: it is because of our reliance on global fossil fuel markets. We must break that reliance. We have to wean ourselves off this rollercoaster of price spikes and price falls, which is harming consumers across the country. The sprint to clean power will achieve that. It is a shame that he cannot see that.
Joy Morrissey (Beaconsfield) (Con)
Consumers are concerned about the rising energy price cap. What will the Secretary of State do to strengthen existing energy schemes and initiate new schemes? Will it include delivering the £300 reduction in energy bills that Labour promised during the general election?
Miatta Fahnbulleh
We know that households are struggling with bills and are worried about them. That is why we are doing everything we can to bear down on bills. We are doing that not just because it is a manifesto commitment, but because it matters to households across the country. While we sprint to clean power—we are clear that that is the route to bearing down on bills—we will support households. Whether it is the £500 million agreement we made with energy suppliers, the extension of the warm home discount to more than 6 million households, or the debt support we are providing to consumers with energy debt, we are taking short-term action. Let me be clear that the way we get ourselves out of this bind is by delivering clean power for consumers across the country.
Harpreet Uppal (Huddersfield) (Lab)
Mr Joshua Reynolds (Maidenhead) (LD)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I thank the hon. Gentleman for his question. We are very aware of the issues with park homes, and industry support is provided to residents. As we think about expanding the warm home discount and the support we provide for households that cannot afford their energy, we will, of course, have park homes in our mind.
Chris Murray (Edinburgh East and Musselburgh) (Lab)
Geothermal Energy
Miatta Fahnbulleh Excerpts(2 weeks, 4 days ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I thank the hon. Member for Bexhill and Battle (Dr Mullan) for bringing this important issue to the attention of the House. I also thank my hon. Friends for their contributions and for the valuable way in which they have engaged in this debate. The hon. Member for Bexhill and Battle has been a great champion of deep geothermal energy in recent years, and the role he has played in the formation of the all-party parliamentary group on deep geothermal is commendable. I was very pleased to attend its meeting in December, and I am grateful for the engaged and constructive discussion that we had.
I agree with the hon. Member that there is a huge opportunity here, and I echo his desire for action and pace; I will briefly say why I share that desire. He will know, as I do, that we are coming out of the worst cost of living crisis that we have seen in a generation, and energy has been at the very heart of that crisis. The reality is that energy is unaffordable for too many people and increasingly out of reach for people who absolutely rely on it as an essential good, and we as a Government are determined to fix that. That means that we need to take action to lower energy bills by breaking our reliance on international fossil fuel markets and sprinting towards clean, home-grown power. That is why the Government are so committed and why we are running at our clean power by 2030 mission, but it is also why our warm home plan is absolutely critical. I reassure the hon. Member that we see that geothermal power has a critical role to play in our energy mix, following its success in the fifth auction round of contracts for difference.
I agree that geothermal energy represents an important opportunity�if the hon. Member hears nothing else I say today, I ask him to hear that. It has the potential to deliver clean and secure energy and heat, reducing our reliance on fossil fuel markets. As he mentioned, we are acutely aware that geothermal energy could also support a just transition by creating thousands of jobs that use skills from our oil, gas and coalmining sectors. The Government provide financial support for geothermal projects today, and we will continue to do so. The critical thing is ensuring that this is done at an acceptable cost to consumers and in an environmentally friendly way.
As the hon. Member mentioned, the most widespread potential for deep geothermal in the UK is as a low-carbon heat source for heat networks. I am convinced that heat networks have a really important role to play as we roll out clean heat and upgrade millions of homes across the country. We have the opportunity to grow their market share from 3% today to 20% by 2050. One of my first visits as the Minister for energy consumers was to the Mersey heat network, where heat from the Leeds and Liverpool canal is being used to provide hot water and low-carbon power for thousands of people, thanks to a water source heat pump. That is a great example of how communities can benefit from local energy sources, which is what the hon. Member and my hon. Friends are advocating for in this debate. I completely commend that and support it.
There are significant geothermal success stories, such as in Gateshead, where the first mine water heat network to become operational in the UK received �5.9 million from our heat networks investment project. That money enabled the council and Gateshead Energy Company to install 5 km of new heat network pipes and a 6 MW water source heat pump. Today, that network heats 350 council homes and the Baltic arts centre, with 270 more homes to be added.
The hon. Member for Bexhill and Battle referred to the public sector scheme. Geothermal heat projects supplying public sector sites are eligible to apply for support provided that they meet that scheme�s eligibility criteria, and again, I agree with him that there is a big opportunity here. I would add, however, that any changes to the scheme would need to be considered once the current spending round is completed. That is what he would expect me to say, but I reassure him that I am very happy to meet him and members of the APPG to discuss their proposals.
Dr Mullan
The point to emphasise is that the current scheme is based on going project by project, which undermines our ability to bundle up the risk, which is so vital to deep geothermal. That is the key change we are looking for: the opportunity for a number of sites to be pulled together, which is what will be most attractive to investors.
Miatta Fahnbulleh
We want to think about creative ways in which we can unlock the potential for investment, so I am very keen to meet the hon. Member and members of the APPG so we can hear those proposals. I give him that reassurance.
Not just today but over recent years, the hon. Member has made a convincing case for the merits of pursuing deep geothermal. The Government remain committed to exploring the renewable energy opportunities afforded by our geography and geology. However, I hope the hon. Member will understand that the priority now�and the thing my boss has tasked me with�is developing the warm homes plan. It would be premature for the Government to set a geothermal strategy with detailed targets in advance of that plan. For us, it is a question of sequencing; for instance, if we are to make the most of geothermal�s potential, we need to start by creating an environment that enables the growth of heat networks and, crucially, protects consumers along the way.
To that end, the Department will bring forward a market regulatory framework in January 2026 to improve consumer protection. We are also consulting on heat network zoning, which is an essential part of our plan to establish and accelerate heat networks. We think that will significantly increase private sector investment and remove some of the barriers. We are committed to taking a long-term, strategic view, and we are trying to sequence this work so that we develop the warm homes plan and build the enabling environment. However, I absolutely recognise the need for us to set a policy framework in which geothermal energy can thrive.
James Naish
The Minister knows that I really admire the work she is doing in this space, and my intervention is more of a query than anything else. She has mentioned the warm homes plan; is a sense emerging of how many of the 5 million properties we are targeting through that plan might be fed by district heating and associated technologies? Is there a crystallisation of what that construct might be, to get us to the 5 million homes that we are targeting?
Miatta Fahnbulleh
We know that there is a big opportunity for district heating, particularly in some of our urban centres. In the work that we are trying to do through the warm homes plan, we are thinking about where those opportunities are and making sure that we work with regional and local government to do some of the planning and the identification of those opportunities. That means that we can take a strategic approach, area by area and place by place.
Rachael Maskell
I am really grateful for all that the Minister is doing in this area. However, some of this work is quite time-sensitive; for instance, we have a major development in York, the first phase of which goes into planning in September. We very much want to work with Government to see what we can deliver in York Central. Would the Minister be prepared to work with us to see whether we can get this model working on some of those micro sites?
Miatta Fahnbulleh
We are keen to work with Members across the House, and with local and regional government. We have set ourselves a challenging set of ambitions, so we are clear that we need to work with anyone that can unlock and bring forward investment opportunities, so as to realise those over the course of the Parliament.
It would be remiss of me if I did not say that we recognise that for all the opportunities, there are still challenges faced by industry to secure the necessary investment. As a result, as the hon. Member said, few deep geothermal projects in the UK are financially viable without Government support, unlike what we see on the continent and in other countries.
The hon. Member mentioned the role of Great British Energy. We are clear that it will provide further opportunities for investment in clean energy. The Great British Energy Bill sets out that
��clean energy� means energy produced from sources other than fossil fuels�,
including geothermal, so let me reassure him that it is within scope. Great British Energy is an independent organisation, but we will give it clear direction that it should be looking at all the opportunities that could be exploited across the country and at different technologies, such as geothermal.
Deployment at scale is also unlikely unless there is a demonstrable pathway to bringing down the cost of geothermal heat to make it comparable to other renewable technologies. We know that. It is why we have been working with stakeholders to improve our knowledge and understanding in this area. In 2024, we commissioned a costs research project, to which the hon. Member referred. We intend to publish that this year. I am asking my officials to work at pace to do that, but I reassure him that we will be engaging with industry prior to publication, and he has my assurance that I will facilitate that to ensure that it happens.
My hon. Friend the Member for Rushcliffe (James Naish) commended the British Geological Survey, and I share his enthusiasm for it. We have commissioned work from it on open access tools that show the technically viable opportunities for geothermal projects in the UK, and we will continue to work with it. The UK is also an active member of the International Energy Agency technology collaboration programme on geothermal energy�that was a mouthful�which has enabled us to gather further learning and to learn from other international examples.
All that is to say that we see the opportunity and we are trying to build the evidence base. We want to work with industry to think about how we unlock geothermal, because we see it as a viable route to the expansion of heat networks and to delivering the objective of warmer homes and cheaper bills.
In conclusion, we are absolutely committed to the project and to delivering warm homes. We know that we need a range of technologies to do that. We cannot do this sprint on our own, so we will always want to work with industry to enable us to get there. I thank the hon. Member for Bexhill and Battle again for securing this debate, and I thank my hon. Friends who are here for being such avid champions of geothermal. My Department is keen to work with them, and I look forward to meeting in due course.
Question put and agreed to.
Warm Home Discount
Miatta Fahnbulleh Excerpts(3 weeks, 6 days ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
With your permission, Madam Deputy Speaker, I would like to make a statement about the action we are taking to protect families in the face of the global spike in gas prices. In recent months, wholesale gas prices have risen to their highest level in two years. They are up nearly 15% compared with the previous price cap period. As a result, this morning Ofgem announced the energy price cap will rise by around £9 a month between April and June. We know this will be unwelcome news for families across the country that are already worried about their bills, but as Ofgem’s chief executive officer, Jonathan Brearley, said today,
“our reliance on international gas markets leads to volatile wholesale prices, and continues to drive up bills”.
This week marks three years since Russia’s invasion of Ukraine, and once again the British people are paying the price of our country being exposed to fossil fuel markets controlled by petrostates and dictators. The truth is that every day we remain stuck on gas is another day families, businesses and, indeed, the public finances are at risk from these kinds of price spikes. That is why sprinting to home-grown, clean energy is the only way to end our exposure and our vulnerability as a country. In the meantime, we are determined to do all that we can to protect people, and today I want to set out the measures we are taking.
First, we want to provide greater help to the most vulnerable in time for next winter. The warm home discount currently gives around 3 million families a £150 rebate on their energy bills. The current system provides help to those on means-tested benefits, but excludes millions of people in homes not classified as hard to heat, as a result of criteria introduced by the last Government in 2022. These criteria are seen by many as arbitrary and unreliable, and they mean there are families in almost exactly the same circumstances with some receiving help and others not.
Today, we have announced that we will consult on proposals to abolish this restriction, meaning all households receiving means-tested benefits would be eligible for bills support next winter—from 3 million families in the current system to more than 6 million with our proposals—so that one in five families in Britain would get help with their bills through this scheme, including an additional 900,000 families with children and a total of 1.8 million households in fuel poverty. This Government are determined to do everything in our power to help people struggling to pay their energy bills and support the most vulnerable in our society.
Secondly, because of our exposure to fossil fuels, the cost of living crisis saw bills rocket to £2,500 and families plunged into unstable debt—debt that continues to accumulate today. In the system we have inherited, every bill payer pays for managing this debt burden. We are determined to act on behalf of those in debt and all the bill payers who are paying the costs of it. So we are working closely with Ofgem to accelerate proposals on a debt relief scheme that will support households that have built up unsustainable energy debt through the crisis and have no way of paying it. This will be an important first step to cut the costs of servicing bad energy debt, and under these plans the target would be to reduce the debt allowance paid by all bill payers to pre-crisis levels.
Thirdly, we know that one of the best answers to high bills is upgrading homes so that they are cheaper to run, so we will shortly announce the details of around £0.5 billion pounds of funding under the warm homes local grant and £1.3 billion under the warm homes social housing fund to invest in home upgrades over the coming years and cut fuel poverty. In all, up to 300,000 households will benefit from upgrades in the next financial year through our warm homes plan—whether it is new insulation, double glazing, a heat pump or rooftop solar panels—which is more than double the number supported in the last financial year. We will also ensure that landlords invest in energy efficiency upgrades that will make homes warmer and bring down costs for tenants, lifting up to 1 million people out of fuel poverty, so that we are doing everything we can to ensure people have the security of a home they can afford to heat.
Fourthly, we are clear that we need a regulator that fights for consumers. That is why we have called on Ofgem to use its powers to the maximum to protect consumers by challenging unlawful back billing, taking action on inaccurate bills, driving the smart meter roll-out, giving every family the option of a zero standing charge tariff so they have more choice in how they pay for their energy, and ensuring that compensation is given for wrongful installation of prepayment meters. We are moving forward on our review of Ofgem to ensure it has the powers it needs to stand up for consumers and clamp down on poor behaviour by energy companies.
This set of measures shows a Government willing to use all the powers at our disposal to help protect consumers. However, important as these measures are, I must stress to the House that there is no proper solution to rising energy bills while this country remains exposed to the rollercoaster of fossil fuel markets. That is why this Government are moving at speed to deliver clean power by lifting the onshore wind ban in England, consenting nearly 3 GW of solar, setting up Great British Energy, delivering a record-breaking renewables auction, making it easier to build the next generation of new nuclear power stations, and getting on with the job of implementing the reforms to the planning system, the grid and renewables auctions set out in our clean power action plan.
I have to report to the House, however, that despite the importance of this mission and the fact that we are running it, we continue to receive representations from Opposition parties not to speed up, but to slow down and to reject solar power, reject onshore wind, reject offshore wind and reject new transmission infrastructure—representations that, if accepted, would leave us more vulnerable and more insecure, with the British people paying the price. Let me tell the House that we will reject those representations. We know that every solar panel we put up, every wind turbine we build and every piece of transmission infrastructure we construct makes us more secure, and every time the Conservatives oppose those measures, they double down on their legacy of leaving this country exposed and the British people deeply vulnerable.
This Government will do whatever it takes to stand up for working people now and in the future—protecting families and businesses from the consequences of global events, driving forward our plans to bring down bills for good and doing everything in our power to support those most in need. I commend this statement to the House.
Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
I thank the Minister for advance sight of her statement. Today, the Government have announced an expansion of the warm home discount, with a change to the criteria that will see more low-income households receive a £150 payment to heat their homes, but for many this payment will be immediately eaten up by the increase in the energy price cap. We must be clear that the best protection for vulnerable households is to prioritise cheap energy. The announcement today is, frankly, a sticking-plaster approach to rising energy bills.
This Government fail to grasp the core issue: energy costs in this country are far too high for businesses, industry and, of course, bill payers. When the energy price cap rose in 2022, the now Secretary of State called it a “national emergency”. He called for an urgent freeze on energy bills and cited a lack of leadership. Now that he is in government, the only thing he is able to freeze is vulnerable pensioners by taking away their winter fuel allowance with no notice. Does the Minister think that shows leadership? I know that my constituents, and presumably hers too, will be concerned about their bills rising, concerned about inflation creeping back up—hitting 3% in January, despite the hard work done last year to bring it under control—and angry that Labour’s promise to cut bills by £300 is being broken.
The worst part of all of this is that this Government, led by ideological zealotry from the Secretary of State, are doubling down. Their obsession with going further and faster than any country in the world to meet their own self-imposed 2030 target is going to increase people’s bills even further. The renewables industry has warned that their rush to build record renewables in the next five years will push up prices and “consumers will lose out”. The Government’s rush to build twice as much grid in the next five years as was built in the last decade will increase the network costs on people’s bills. The Office for Budget Responsibility has said that the environmental levies will increase to £14 billion in 2030, largely driven by the hidden cost of renewables, all of which will end up on people’s energy bills.
The Labour party was not honest about its promise during the election to cut bills by £300, it was not honest about its plan to take the winter fuel payment away from millions of pensioners living in poverty, and now it is not being honest with the British people about what its plans will do to our energy bills. If we have learned anything over the past few years, it is that the cost of energy is absolutely critical to any modern economy. We cannot go on following ideology over evidence and putting political targets ahead of what will cut the cost of energy in this country. However, this Government are in denial, which is why they scrapped the full system cost analysis commissioned when the Conservatives were in office.
Will the Minister say when proposals for a debt relief scheme will be published? Will she confirm by how much she expects levies to increase over the next five years? Will she commission a full system cost analysis of what the 2030 target will do to people’s energy bills? Will she confirm by how much bills will rise before we see the £300 off, which we were all promised?
Miatta Fahnbulleh
The hon. Gentleman is right that energy prices are too high—on that, we agree. We also agree that that is worrying for families and businesses across the country. However, I would point out that 80% of this rise has been driven by wholesale prices. I would also gently remind him that the reason we are in this position—the reason we are so exposed to global fossil fuel prices over which we have no control—is because the Conservatives spent 14 years in government squandering the opportunity to accelerate the transition to clean power and reduce our dependence on global fossil fuel prices, leaving families across the country exposed.
The status quo is not tenable. We are at a point where energy prices are at an historic high, and we got here under his Government. That is a status quo that we are not willing to contend with. That is the reason—not because of ideology, but because we see the obvious: as long as we are dependent on global fossil fuel prices, we will be on this rollercoaster. That is what is driving the push to clean power. While the Conservatives have no alternatives, we have a clear alternative: we run to clean power; and while we do that, we support the most vulnerable households in the short term.
To answer the shadow Minister’s question, Ofgem is in the process of consulting on the debt support scheme as we speak, and we will support it to put that in place. We know that the debt burden has increased by £3.8 billion, and more than 1.8 million households in need of help will be supported by that scheme. We are absolutely committed to cutting bills—everything we are doing as a Government is driven by that desire and clear commitment. We will do that both through short-term measures and, critically, by running at clean power by 2030.
We have a plan to deal with energy bills. The Opposition have a plan to slow down and do nothing, and it will be the British public who pay the price.
Jon Trickett (Normanton and Hemsworth) (Lab)
It is clear that the Conservative party left this country dependent on global fossil fuel supplies, which both burn the planet and are damaging in terms of price controls. However, the Tories left something else as well: a rigged energy market, which gave £480 billion to the energy industry yet left 8 million households—probably 17 million people—in fuel poverty, spending more than 10% of their income on energy.
It is therefore welcome that the Minister has today announced an additional £150 for the warm home discount, but that, as I understand it, is a one-off payment for next winter. A £150 one-off payment will not resolve the underlying problem—today, the regulator has increased the cap by £111 or £108, depending on how it is calculated, per year on an ongoing basis. I welcome the Government’s announcement and recognise the Minister’s commitment to changing the way that things work. However, will my hon. Friend confirm to the House that the Government intend to end this rigged market, which works in favour of the profiteers, and tackle the scourge of fuel poverty, while at the same time securing a just transition to clean energy?
Miatta Fahnbulleh
My hon. Friend is absolutely right. We have an energy market that does not work sufficiently in the interest of consumers, and we are committed to turning that around. That is why we are reforming the electricity market, why we are trying to drive forward a shift from fossil fuels to clean power, and why we are putting in place the review of Ofgem, to ensure that customers and consumers are at the very heart of everything we do in the energy market. This is an important step to supporting households in the short term. We took action this winter, with up to £1 billion of support through Government and industry to help the most vulnerable customers, and the measures announced today will ensure that we will provide support next winter. However, it is not the end of our ambition; it is the start of our ambition to reform the energy market.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Madam Deputy Speaker
When will you set those out, Minister, since I will not be responding at the Dispatch Box?
Miatta Fahnbulleh
The hon. Lady is right that insulating and upgrading people’s homes is the route by which we will reduce bills and deliver homes that are warmer and cheaper to run. That is why we are absolutely committed to the warm homes plan. Rather than there being a pause, we are running at this.
Next financial year, 300,000 homes will be upgraded, which is double the number in the previous financial year, and that is just the start for our warm homes plan. We are working with colleagues in the Ministry of Housing, Communities and Local Government to bring forward the future homes and buildings standards. Critically, we have spoken to industry, installers and local government, and we are acutely aware that there should and cannot be a hiatus. We are moving forward with the local grant and the warm homes social housing scheme to ensure that there is not one. I ask the hon. Lady to write with the specifics of that scheme, because we are trying to design it to stop that.
Critically, on the social tariff, we are clear that clean power is the route by which we will bear down on energy costs in the long term, but that we will need to support the most vulnerable customers as we get there. There are different ways to design a social tariff, and we are looking at options for how to support the most vulnerable at the moment, and the warm home discount is a key part of delivering that.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Luke Murphy, a member of the Energy Security and Net Zero Committee.
Miatta Fahnbulleh
I thank my hon. Friend—that was well said.
The Conservative party left us with the highest energy prices that we have seen in a generation. That is a legacy that, quite frankly, should see them hang their heads in shame. Rather than criticising us for trying to unpick and deal with their legacies, I would strongly caution them to support our action. [Interruption.] It is their legacy!
My hon. Friend is right: the way that we get out of this bind, left by and inherited from the Conservative party, is through clean power, delivering renewables that we know are cheaper and clean power by 2030. My hon. Friend is right; the Conservative party continues to be misguided. Thankfully, we are in the driving seat.
Madam Deputy Speaker
I call a member of the Energy Security and Net Zero Committee, Bradley Thomas.
Bradley Thomas (Bromsgrove) (Con)
Rising energy costs affect not just households but industry. Sir Jim Ratcliffe has said that deindustrialising Britain is a false economy because it “shifts production and emissions elsewhere”. Can the Minister tell the House what is more important: chasing an arbitrary target or protecting industry and jobs?
Miatta Fahnbulleh
Businesses are under pressure from high energy prices. We know that. Again, I remind Conservative party Members that given their legacy, they should perhaps be a bit more humble about that. We are working with industry and it recognises that the way to drive down energy bills is through clean power. The Confederation of British Industry came out this week saying that our energy revolution is good for business. It is the route to lower energy costs for business and to creating jobs across the country. We have a plan, not just for energy bills but for jobs and the economy, which is rooted in clean energy, and that is much better than the legacy that we have inherited.
Nesil Caliskan (Barking) (Lab)
Thousands of my constituents are still dealing with the cost of living crisis, finding themselves in debt because energy prices hit record levels under the previous Government. Energy prices continuing to go up makes those constituents’ lives more difficult, so I welcome the Minister’s statement. Will she, however, provide further reassurance about the immediate action the Government can take to regulate energy companies who are taking their customers for a ride, such as the thousands of my constituents who still do not have meters in their homes and who are being billed unlawfully for backdated energy and, in some cases, energy that they have not used? Will the Minister give the House further reassurance that there needs to be immediate action, as well as a long-term plan from the Government to see the transition to clean energy?
Miatta Fahnbulleh
My hon. Friend is absolutely right to point out the cost of living crisis that blights constituencies across the country, with many people facing energy debt totalling £3.8 billion. She is also right, however, to point out that there are things that must be done to ensure that customers are served by the energy market. That is why we are ensuring that the regulator has the power—we are also instructing it to use the ones it has—to ensure that things such as back billing, which we know is an issue, do not happen. The rules are very clear and we need them to be enforced to ensure that when customers do not receive the best customer service from their suppliers, there are consequences. Our review of Ofgem is to ensure that it has the powers it needs to be that champion for consumers. In the end, the energy market must work in the interest of people. We agree that that is not happening at the moment and it must happen after we reform it.
Wera Hobhouse (Bath) (LD)
In the UK, electricity prices are linked to the global fossil fuel market, which is at the bottom of UK households’ paying the highest energy costs in Europe. To fix that, the use of a single levy-controlled system has been suggested, with two simple rates—one for electricity and one for gas—set by Ministers. That would allow the Government to manage the cost for households and lower prices, especially for clean energy. Will the Minister look into that suggestion? I am happy to meet her to go through those details further.
Miatta Fahnbulleh
Our reform of the energy market arrangements looks at all the aspects of our electricity market that are not working. The Under-Secretary of State for Energy Security and Net Zero, my hon. Friend the Member for Rutherglen (Michael Shanks) is looking at that question and the Department is willing to work across the House to ensure we get to the right arrangements. As long as gas continues to drive the cost of energy, that will create a problem and have an impact on consumers. We are alive to that question and will report on that in due course.
Amanda Martin (Portsmouth North) (Lab)
I thank the Minister for her statement. I hear from many constituents who suffer with energy debt as a result of the previous Government’s failure to protect billpayers during the energy crisis. Many of them are petrified, unable to move or change providers. I welcome the proposed acceleration of a debt relief scheme, but can the Minister provide more details on how that will help families in my constituency of Portsmouth North?
Miatta Fahnbulleh
We know that energy debt is a big problem. I have spoken to people across the country who are suffering with accumulated debt that they have no way of paying, with many having to forfeit energy as a consequence. Ofgem is consulting on a range of options, but at the heart of that is the principle that there needs to be a debt relief scheme. Whether we write off some of the energy debt that cannot be paid, or put in place payment plans, we want to ensure that those 1.8 million households have the opportunity to drive that debt in a way that means their energy will be sustainable. That is absolutely critical. It deals with the legacy of the energy crisis and the fact that many households have had to accumulate debt because they just could not pay £2,500. It is an important step and one that we are keen to support the regulator to deliver.
Sir Julian Lewis (New Forest East) (Con)
I entirely agree with the Government that, as the Minister said in her statement, we should not be “paying the price of our country being exposed to fossil fuel markets controlled by petrostates and dictators.” Given that we cannot move completely to clean energy tomorrow, why do the Government insist on closing down and, indeed, concreting over our potential fossil fuel gas reserves until such time as we can move completely to clean energy? Why should we import it from other states while piously saying that we will not extract it from beneath our own country?
Miatta Fahnbulleh
There will be a role for gas in our energy mix, but we are very clear that the route and the quickest way to getting ourselves off that dependence is through clean power. We have made a decision that we will put our energy into driving clean power by 2030. In the end, that is the quickest and best route to delivering for consumers and businesses and ensuring that we can deliver energy security, which we all, across the House, agree will deliver financial security for families across the country.
Perran Moon (Camborne and Redruth) (Lab)
I thoroughly welcome the statement, particularly on the reform of Ofgem and back billing. It is a key plank in the just transition as we move away from a rigged energy market that is totally reliant on imports of gas from dictators such as Putin. It is not, however, just about the transition to renewables. Does the Minister agree that in that transition we will also create hundreds of thousands of new green jobs right across the UK, including in Camborne, Redruth and Hayle, covering onshore wind, offshore wind, geothermal, tidal and solar?
Miatta Fahnbulleh
My hon. Friend is absolutely right. At the heart of this is the opportunity to create jobs and boost local economies across the country. That is good not just for our energy independence and family finances, but for every single part of our economy. That is why, rather than slowing down, we are committed to accelerating to deliver clean power by 2030.
John Glen (Salisbury) (Con)
Families and businesses obviously operate in an environment with lots of different costs. When they see increases in their tax bills, the burdens of potential new regulation and additional energy costs, they are bound to challenge themselves on what they can afford to invest. The Minister is clear on the Government’s strategic direction, but does she not accept that in the short and medium term the burdens during the journey to change are enormous for business and will have a massive effect on the level of investment in this country? Does that not concern her?
Miatta Fahnbulleh
I challenge the right hon. Member on this matter. Businesses are completely behind us because they can see that clean power is the route by which we reduce energy costs and, critically, create jobs and invest in our industry. That is good not just for people’s pockets, and for dealing with the energy problem, which we know we have to deal with, and the affordability problem, but, ultimately, for the economy. It is good for business. This is a win-win situation. It is a shame that the Conservative party cannot see it, because it is obvious to us, obvious to industry, and obvious to businesses across the country. That is why we will continue to power forward with our plans.
Deirdre Costigan (Ealing Southall) (Lab)
The previous Conservative Government abjectly failed to insulate our leaky homes and get our home heating systems ready to take advantage of the cheaper, clean energy that Labour is now creating. In addition to the very welcome discount that the Minister has announced today, does she agree that Labour’s plan to upgrade hundreds of thousands of homes with heat pumps and better insulation next year is a vital part of this Government’s commitment to lowering household bills?
Miatta Fahnbulleh
My hon. Friend is completely right: the previous Government failed to insulate and upgrade enough homes to protect people from energy price hikes. Conservative Members are hanging their heads in shame and rightly so. She is also right that we are committed to upgrading hundreds of thousands of homes. That is critical. The way that we ensure that households are insulated from price rises and the way that we drive down prices is to upgrade those homes. That is a central part of our plan. We are already running at it with 300,000 homes in the coming year, but we will build on that, because we want to ensure that homes across the country benefit.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call a member of the Energy Security and Net Zero Committee.
Claire Young (Thornbury and Yate) (LD)
Chopping and changing home upgrade schemes, as we saw under the previous Conservative Government, causes uncertainty and confusion, which is damaging for both consumers and installers alike. Will this Government avoid that mistake by setting out long-term plans for energy efficiency schemes that go beyond 2026?
Miatta Fahnbulleh
One hundred per cent. We need a long-term plan, so that every part of the system can respond to that. Our warm homes plan will try to set a long-term trajectory, so that we can marshal every part of the system necessary to deliver hundreds of thousands of upgrades, year in, year out.
Dr Jeevun Sandher (Loughborough) (Lab)
May I welcome the Minister’s announcement around the expansion of the warm home discount scheme? About 160,000 homes in my region will get £150 more help with their energy bills, but, clearly, the root cause of higher prices is higher natural gas prices, which have doubled since the election in July 2024. We know that natural gas is 50% to 75% more expensive than wind and solar, because the sun and the wind are free, and natural gas is not. Can the Minister assure me that we will get into clean energy by 2030, so that we can get our energy bills down for good?
Miatta Fahnbulleh
I thank my hon. Friend for making the point so well. He is absolutely right that this is the route by which we can deliver cheaper energy. I can assure him that we are committed to driving this for the reasons that he said. This is the way that we break the stranglehold that we are in. This is the way that we get off this rollercoaster of price rises and price falls that is impacting households across the country. The commitment is there, and we are running with that commitment.
Dave Doogan (Angus and Perthshire Glens) (SNP)
Yet again, an Energy Minister comes to the House to tell us that they are moving at pace. The only thing moving at pace is the last shred of credibility from that Department as it talks about protecting consumers from higher energy prices. Let us not forget that this is the Labour party that stripped 900,000 Scottish pensioners of their winter fuel payment, and that told us that fuel prices would go down £300, when they are now £600 higher than the level it promised they would be ahead of the election. Can the Minister explain three things to me? Did the Labour party profoundly misunderstand how energy in the United Kingdom works, or was it misleading the electorate? Why is it that the Minister is making such a big deal about Ofgem doing its actual job of getting after back billing? Should it not be doing that anyway? Why is that an announcement? Thirdly, when will consumers in GB finally see some response from this Government about higher energy bills?
Miatta Fahnbulleh
I remind the hon. Member that the Scottish Government have jurisdiction in this area. We are working in collaboration with them to deliver this, but the Scottish Government do have responsibility in this area and he knows it. We are committed to bearing down on energy bills—of course we are. It is the central driving mission of everything that we are doing as a Government. It has been eight months. I hope that everyone can see from what we have done—whether it is removing the ban on onshore wind, whether it is a record-breaking auction, or whether it is the plans that we have to support the most vulnerable households—that we are running at this. We take our commitment seriously, and we are doing everything in our power to drive it. I suggest that the hon. Gentleman reminds his colleagues in Scotland that they should be using the power that they have, including with the warm home discount, to protect their consumers.
Chris Vince (Harlow) (Lab/Co-op)
I welcome the Minister’s statement. This extra support will make a huge difference to residents in my constituency of Harlow. One of the issues with living in a post-war new town is that all the houses were built at roughly the same time, so the issues of insulation all appear at roughly the same time. At this morning’s crisis summit, which I and the hon. Member for Mid Dorset and North Poole (Vikki Slade) attended, there was a strong feeling that cross-departmental communication is key to ensuring that funding gets to the people who need it the most. Does the Minister agree?
Miatta Fahnbulleh
I completely agree with my hon. Friend. That is why we are working with the Department for Work and Pensions and the Ministry of Housing, Communities and Local Government, and across Government, to target this support at households, so that we are helping people who we know are struggling.
Mr Richard Holden (Basildon and Billericay) (Con)
It was interesting to hear the Minister say how humble we on the Conservative Benches should be. Clearly, the Secretary of State for Energy, Security and Net Zero is so humble that he has not even bothered to turn up for this supposedly important statement. It is no more than a smokescreen, as we are seeing energy bills go up yet again. When will my constituents see the £300 energy cut that was promised by the Government? The Minister talked about international markets. Why on earth are this Government not looking again at drilling in the North sea? It is vital that we do so today; then, rather than just helping out a little bit with means-tested benefits, they could perhaps afford to do more for my constituents who are on £12,000 or £13,000 a year, and for pensioners who are losing their winter fuel payments this very year. Why will they not take a look at that?
Miatta Fahnbulleh
Given the legacy of the right hon. Gentleman’s party, a bit more humility is warranted. We are committed to driving down energy bills. Everything that the Department is doing hinges on the central task of getting clean power. Everyone, including the regulator and industry, recognises that prices are going up because of our reliance on global fossil fuels. We are committed to dealing with that, and to providing support to the most vulnerable. We are taking action. The Conservatives were in power for 14 years and did absolutely nothing. Absolute shame on them.
John Slinger (Rugby) (Lab)
I welcome the Minister’s statement. Will my hon. Friend join me in praising the work of Citizens Advice teams, such as those that I have seen in my constituency of Rugby, who provide really useful support? They help people to navigate the numerous support schemes that the Government have put in place. They also deal with debt management and income maximisation. They are helping our constituents at a difficult time with the cost of living crisis that we inherited. Does she agree that this is valuable work that deserves our continuing support?
Miatta Fahnbulleh
My hon. Friend is completely right. Citizens Advice teams, and the network of third-party organisations and charities that they work with, are providing some of the most vital support to our constituents at a really difficult time. Citizens Advice is a key partner. We work with it and engage with it. I am going across the country meeting its teams, because we absolutely need their help to target support at the most vulnerable.
Lee Anderson (Ashfield) (Reform)
I thank the Minister for her statement, but not for the madness contained within it. Recently, we have discovered a new gas field in Lincolnshire. We could frack the gas, yet we are still importing fracked gas from the United States, which is creating all sorts of mayhem in the atmosphere. Does the Minister agree that it would be better for the environment if we fracked our own gas, rather than importing it from America?
Miatta Fahnbulleh
I am disappointed that the hon. Member did not listen to my statement. If he had listened to it properly, he would not have come up with that statement. Once again, there will be a mix, but we are clear that the quickest route to driving down energy bills is through clean power by 2030. That is sprinting at it. There is no other route to delivering energy security and financial security for our country. The industry is behind us on this, and we are working to deliver it.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
I welcome the support in this statement, and the fact that 300,000 houses will be insulated in the next year. Does the Minister agree that the only long-term solution that will lead to energy security is our clean power plan? It will be good for areas like mine. The Confederation of British Industry pointed out yesterday that the green economy is growing three times quicker than the wider economy in this country. People want us to speed up, not slow down.
Miatta Fahnbulleh
My hon. Friend is 100% right. This is the route by which we will deliver for people’s pockets and, critically, deliver the jobs that we need across the country and boost our economy. We are clear-sighted about what needs to be done. It is a shame that the Conservative party is so blinkered.
Lewis Cocking (Broxbourne) (Con)
We need to produce more energy at home from renewables and oil and gas, as we need a diverse energy mix in the UK. That will help us to deal with the volatile global energy markets. When will the Government change course and support the UK’s oil and gas industry, including the cluster based in north-east Scotland, and issue new oil and gas licences to help bring down bills for residents across the country and in my constituency?
Miatta Fahnbulleh
I direct the hon. Member to the clean power plan, and the analysis done on the way to deliver energy security. We are clear that this is the quickest and best route by which to do that. In the end, one thing guides what we do: the need to get lower bills for the long term. We believe that this is the way to do it. The rest of the system agrees with us, from the regulator through to NESO. Our job is to crack on and deliver that.
Tom Collins (Worcester) (Lab)
I welcome the Minister’s statement, which has practical steps to support people with their bills, and a long-term plan, delivered at speed, to transition to a resilient, sustainable, clean energy system that takes advantage of the incredible advances in renewables in recent years. Offshore wind is providing really low-cost power, underpinned by UK-led innovation in technologies such as hydrogen. The Minister has laid out ambitious plans for supporting households in upgrading their homes, and has made excellent early progress on those upgrades. Will she continue working in partnership with UK innovators and manufacturers to make it not just possible but easy for homeowners to keep their homes warm with dependable, clean and affordable energy?
Miatta Fahnbulleh
My hon. Friend is completely right. We are committed to working with industry on upgrading our homes. We believe that that is the way to drive down bills, but we need to make this as easy as possible for consumers across the country. We are working with industry and across the piece to deliver at pace.
Luke Taylor (Sutton and Cheam) (LD)
I welcome many of the measures in the statement, although I echo the request from my hon. Friend the Member for Bath (Wera Hobhouse) that we consider decoupling electricity and gas prices; that would make such a difference. In 2023, Sutton council was blocked by the opposition Conservative group from partaking of an EU grant to help upgrade some of our council houses to energy performance certificate rating C. I welcome the warm homes social housing fund, but I encourage the Minister and the rest of the Government to increase the amounts available in these funds, so that we reward as often as possible councils that are ambitious to provide better, warmer homes for their residents.
Miatta Fahnbulleh
We are committed to working with local and regional government. We are increasing the support provided and are ensuring that it is long-term support, because we agree that the route to insulating lots of homes is through partnerships with local and regional governments, to deliver homes that are warmer and cheaper to run.
Carla Lockhart (Upper Bann) (DUP)
Northern Ireland is the only region of this United Kingdom where the warm home discount scheme is not available. Since 2011, the UK Government have failed to grasp this issue. The reason given is that fuel poverty is a devolved issue, but the same can be said of Scotland and Wales. When the price increase in Northern Ireland is announced next week, the assistance will not be available. Will the Minister meet me to discuss this matter? Furthermore, will she open conversations with the Northern Ireland Executive about righting this wrong?
Miatta Fahnbulleh
We are reaching out to and working with the Northern Ireland Executive. I would be happy to meet on this issue.
Ann Davies (Caerfyrddin) (PC)
Extending the warm home discount to all households that receive means-tested benefits could make a difference to many, especially those who have not received their winter fuel payment this winter. However, £150 off will not go far enough to help the 56% of adults in Wales likely to ration their energy over the next three months, according to National Energy Action Cymru. With the energy price cap rising again in April, will the Minister admit that we need long-term solutions that ensure energy affordability, such as the social energy tariff, which I have asked for since I came to this House last July, in order to support—
Miatta Fahnbulleh
I agree that we need long-term solutions. That is why we have talked constantly about the clean power mission, and why we are clear that while we make the transition to clean power, we will support the most vulnerable households. As an important first step, we are extending support next winter to over 6 million people who we know are struggling. We will continue to build on that in the weeks and months ahead.
Fuel Poverty: England
Miatta Fahnbulleh Excerpts(1 month, 1 week ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I thank my hon. Friend the Member for Normanton and Hemsworth (Jon Trickett) for securing this really important debate. He has a great record of speaking up for low-income and vulnerable families in his constituency and across the country. I share his desire to tackle fuel poverty and his anger that energy is simply unaffordable for too many people in this country. The Government are determined to take the action necessary to lower bills and support the most vulnerable in our society.
I thank all Members for their contributions, and for highlighting the heartbreaking stories of families across the country that are struggling.
John McDonnell (Hayes and Harlington) (Ind)
The Minister talks about heartbreaking stories. My hon. Friend the Member for Liverpool West Derby (Ian Byrne) and I have just come off a Public and Commercial Services Union picket line outside a Department, and one of the issues that was raised with us was the cost of living, particularly fuel poverty, because those workers are on low wages and are experiencing poverty. One of the things that Ministers could do now is go back to their Departments, review all their contracts, end the outsourcing and bring those workers back into an insourced service.
Miatta Fahnbulleh
We know there is a challenge with the cost of living. We are coming out of the worst cost of living crisis that we have faced in a generation, and tackling it is central to what we are trying to do in my Department and across Government.
It is important that we situate this debate in the context in which we find ourselves. We published a review of our fuel poverty strategy last week, and the headline was staggering: fuel poverty stagnated in this country under the previous Government. In 2023, an estimated 13% of households in England—3.17 million people—were in fuel poverty according to the low income low energy efficiency metric, which is a narrow statutory definition. We know that out there in the country a lot more people are feeling the pressure of energy bills and have the sense that they cannot cope and cannot afford to heat their homes.
In 2023, about 46% of all low-income households in England lived in properties with an energy efficiency rating of band D or lower. That creates a cycle that is difficult to escape: the poorest in our country live in cold homes. Behind those statistics are lives, and I have heard the stories directly. People are scared to turn on the heat because they fear the bill at the end of the month. Parents are having to make the impossible choice between feeding their kids and heating their homes.
We know that the reality is intolerable for too many people. That is the legacy of the previous Government that we inherited, but we are determined to turn it around. Every family and business in the country has paid the price of our dependence on global fossil fuel markets that we do not control. We inherited sky-high energy bills. Yes, they are down from the crisis peak, but they are still at record highs.
Our clean power mission is not ideological; it is a primary solution to this problem. We are running to deliver clean power at this pace because we see that as our route to delivering home-grown energy that we have more control over, that will deliver energy security for the country and, critically, that will take us off this rollercoaster of price hikes, which are impacting families, and deliver the financial security that families across the country are desperate for. But we recognise that, while we do that, we also need to reform the electricity market. The review of electricity market arrangements, which we are working on at the moment, is looking at the very question of how we decouple gas from clean power prices. Our judgment is that, as we increase the amount of clean power in the system, we will do the job of decoupling, alongside market reforms, so that people can benefit from the big changes we are trying to make.
We recognise that we also have to support struggling families while we make that transition.
Robbie Moore
I thank the Minister for allowing an intervention. I raised concerns in my speech about the fact that 64,000 pensioners are struggling now to make that difficult choice between putting food on the table and heating their homes, and she has rightly acknowledged that. Does she recognise that the choice she and the Government made to remove the winter fuel allowance was wrong, when so many pensioners are in a dire state as a result of that choice?
Miatta Fahnbulleh
The hon. Member raises winter fuel payments, as hon. Members across the House have done. The Chancellor had an impossible job to do and made a tough call, but we have been clear that we will do whatever is needed to support the most vulnerable. Everything I am charged with doing, everything that my Department is trying to do, is to ensure that households struggling with bills can be protected and insulated.
The Government reviewed the fuel poverty strategy, “Sustainable warmth: protecting vulnerable households”, because we recognised that the trajectory we were on was not the right one. The review showed that progress on meeting the statutory target has stalled. Alongside that review, we are consulting on how to up our strategy to respond to that problem.
Jim Shannon
In questions, urgent questions and statements in the Chamber, I have been keen to ensure that every part of this United Kingdom of Great Britain and Northern Ireland can benefit from strategies in this House and that the ripples go out to everywhere. In my contribution, I asked the Minister again whether there would be an opportunity to discuss the matter with the relevant Minister back home. I know the Minister is committed to that. Will she please update me on where those talks and discussions have gone, so that we can all benefit?
Miatta Fahnbulleh
Let me reassure the hon. Member that we are talking to all devolved Administrations. There are common challenges that we all face and common solutions. We are working in collaboration; we have an interministerial working group, and I am having direct conversations with all devolved Administrations as we take forward our plans.
We are also trying to work with everyone. The challenge we face to turn around the trajectory on fuel poverty is huge and the inheritance is tough, so we want to draw on the expertise of consumer groups, industry and academia as we develop our plan on fuel poverty.
Nick Timothy
The Minister talks about the tough job the Chancellor faces. Does she acknowledge that the job is tough because of the Chancellor’s own choices? The Minister talks about the inheritance but, as I said in my speech, the Labour manifesto said that Labour would increase spending by £9.5 billion a year, while the Budget increased it by £76 billion a year. That is why the Chancellor faces tough decisions—they originate with her own political choices. Does the Minister acknowledge that?
Miatta Fahnbulleh
That is pretty audacious of the hon. Member, given the record of the previous Government, their financial position and the wrecking ball they took to the economy. We have to clean up the mess of the previous Government, so yes, we have had to make tough choices before that. Candidly, if I were in the hon. Member’s position, I would be hanging my head in shame, rather than lecturing this Government on how we clean up the mess they created. What I will say is that, whether on the economy or fuel poverty, we understand that we have been given an atrocious inheritance. We are not complacent about that. Things that the Conservatives were willing to accept, we are not willing to accept.
Miatta Fahnbulleh
I will make progress. On the critical issue of fuel poverty, we are consulting in order to improve our strategy, looking at how to make progress on our statutory target for 2030 and asking questions about wide affordability. As we take action, we must ensure that we are dealing with our statutory obligation and the more fundamental problem of affordability across the country.
Alongside our consultation on the fuel poverty strategy, we have also taken steps to try to lift half a million people out of fuel poverty by improving standards in the private rented sector. Last week we published a consultation on increasing minimum energy efficiency standards in the domestic private rented sector by 2030. Our proposals would require landlords to upgrade their homes so that tenants can benefit from warmer homes through insulation, cavity wall insulation and double glazing first, and then through other measures such as solar, batteries and smart meters.
My hon. Friend the Member for Normanton and Hemsworth asked about the impact on renters. I would say two things. Our analysis suggested that if we get this right, it could save renters about £240. We know that there is a risk of landlords potentially hiking bills, but when we have upgraded homes in the past, we have found that landlords have not increased bills, so we do not expect them to do so this time. Critically, we have also been surveying landlords, and the feedback is that the majority would cover the cost of the upgrades, which they know is the right thing to do. I should add that 50% of landlords have already upgraded their homes up to EPC C, so they will pay for this through those savings. We are therefore confident that renters will not be penalised, and we believe that the measures in the Renters’ Rights Bill will provide enough safeguards to ensure that renters can benefit from £240 off their energy bills and the security of knowing that their rents will not be increased.
Robbie Moore
Does the Minister recognise that many landlords are not in a sound financial position themselves, and that the challenge of getting the energy performance rating of their rental properties up to C can therefore be incredibly costly and sometimes unachievable, given the old housing stock? Will she outline what support will be available to achieve the Government’s ambition of upgrading to an energy performance rating of C?
Miatta Fahnbulleh
We have estimated that the average cost of upgrading homes to C is about £6,000. To protect landlords, we have put in place a cap of £15,000 and created mechanisms to provide exemptions for those landlords who we know will genuinely struggle. Alongside that, we are already providing support through our boiler upgrade scheme and warm homes local grant, which landlords can access, and we will be setting out more measures in the warm homes plan to support landlords on this journey. I should say that the vast majority of landlords want to do this—50% have already done so. We need to level the playing field for renters, so that all landlords are delivering homes to a standard that will ensure that they are warmer and cheaper to run for tenants.
A big plank of what we know we need to do to tackle fuel poverty—alongside what we are trying to do on minimum energy efficiency standards in the rental sector—will be our warm homes plan, which will transform homes across the country to make them cheaper and warmer. The idea behind it is simple and will mean upgrading homes with insulation, solar and heat pumps. In response to the points made about delays in rolling out the warm home plan, I would say that we are running at this. This year alone, we have massively increased the number of upgrades that we are expecting to 300,000, backed by £3.2 billion-worth of investment, and we will come forward in the spring with our plans to ramp that up.
The key thing that we are trying to achieve is moving from the hundreds of thousands of upgrades that we have seen—the inheritance of the last Government, who frankly slashed home upgrades, despite knowing their huge impact on bills and the comfort of consumers —to upgrading millions of homes. That will mean taking a comprehensive look at how we increase demand for home upgrades and deliver at scale in different places, working with regional government and suppliers, and, critically, how we ensure that when people go on this journey of upgrading their homes, they have the confidence to know—to the point made earlier—that the work will be done to a quality standard, and that if things go wrong there will be redress and protection. The current system that we inherited was far too fragmented and ad hoc. Consumers are not at its heart, and we absolutely must turn that around.
Ellie Chowns
I thank the Minister for giving way and for her comments so far. On the point about tackling the fragmentation and ad hoc nature of the previous system, does the Minister agree with me that home insulation upgrades are a win-win-win policy. They are good for people’s warmth and health, they are really good for jobs and they help to save the climate as well. One key barrier in recent years has been the stop-start, year-on-year type of policy that means that nobody in the supply chain is able to plan and have the strategic direction that they need to make the investments, build the labour force and so forth. Will the Government provide the long-term certainty about the policy direction and level of investment required so that everybody can pull together in the same direction?
Miatta Fahnbulleh
I absolutely agree that home insulation is a key part of how we tackle the problem of fuel poverty. Unless we have homes that are insulated, whatever energy we put into people’s homes, at whatever price, is going out of their windows. That is why it is so important to what we are trying to do through the warm homes plan. We seek through the plan to provide long-term certainty: for consumers, so that they know there is a programme that will support them through a journey, and, critically, for the supply chain.
I have spoken to many installers who tell me they are living hand to mouth. The ability to build, to plan, to recruit apprenticeships and to build up capacity is constrained by a stop-start approach. We are clear that the plan needs to be long term. We are working to make sure we can underpin that with long-term certainty on funding, so that we can see the level of ramp-up and scale-up that we need to insulate and upgrade millions of homes, rather than hundreds of thousands of homes.
Clive Efford (in the Chair)
Order. Can I just say that I need to bring in the mover of the motion for a couple of minutes at the end? Thank you, Minister.
Miatta Fahnbulleh
Let me address the points made by Members from rural constituencies. This plan has to work for every part of the country and we have to have solutions for every house. Rather than the Government dictating solutions from on high in Whitehall, we need to empower the system to figure out the best way to deliver warm homes for people across the country. That means thinking about the range and mix of solutions that go into people’s homes, so that they can have low-carbon options, but also options that work for their pockets.
Alongside what we need to do through our warm homes plan, it is important to say that we must also deal with the question of supporting households on bills. That is why going into this winter, wanting to do everything we can to support the most vulnerable, I worked with energy suppliers to get them to commit to £500 million of industry support for people this winter so that we can get help to households that we know are struggling. The Government have also extended the household support fund until 31 March 2026 with an extra £752 million. We are providing the cold weather payment and our Department is providing the warm home discount to more than 3 million households. The Warm Home Discount (England and Wales) Regulations 2022 expire in 2026, so we want to consider options for the future.
Members talked about a social tariff. The challenge with the social tariff, which we are hearing about across the piece, is that it means different things to different people. However, we are looking at all the options to make sure we can provide the support that people need.
In conclusion, I understand Members’ passion; I share their passion and their commitment. Energy is not a luxury good. It is not a “nice to have”. It is foundational for people, but it is out of reach for some. That is a shame and a stain on us, and we are determined to turn things around.
Draft Energy Bill Relief Scheme and Energy Bills Discount Scheme (Amendment) Regulations 2024
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I beg to move,
That the Committee has considered the draft Energy Bill Relief Scheme and Energy Bills Discount Scheme (Amendment) Regulations 2024.
The regulations were laid before the House on 16 December 2024. They amend two schemes that were created by the previous Government in response to the energy crisis. The amendments address an issue that was not considered in the rush to create the schemes, but has now come to the fore as we bring the schemes to an end. The issue is somewhat technical, so I ask hon. Members bear with me.
Both the energy bill relief scheme and the energy bills discount scheme, which I shall refer to as the EBRS and the EBDS, supported non-domestic energy users, including businesses and heat networks. The EBRS supported energy bills from October 2022 to March 2023 and the EBDS supported bills from April 2023 to March 2024.
The schemes have processes in place to ensure that, as bills are revised with accurate meter readings, the difference between the discount applied to the estimated bill and that applied to the final bill is reconciled. Suppliers then come back to Government to recover additional discounts they have paid out, or to pay back any excess discounts stemming from an over-estimation of the energy used in the first instance. That is right—the intention behind the schemes has always been for the Government, not the energy suppliers, to meet the cost to the consumer.
The regulations allow for the Secretary of State to determine when a supplier should leave the scheme on the basis of an assessment that there will be no further material amount owed by the Department to that supplier. Once a supplier has left the scheme, they are unable to claim back any further moneys from the Department for discounts they paid out on behalf of the schemes.
However, as the regulations currently stand, suppliers are still required to pay out discounts on any newly billed energy supplied during the periods of either scheme, even when that situation arises through no fault of their own. This could result in suppliers funding Government support without the ability to recoup those costs from the Department. That is contrary to the intention of the schemes. Consequently, suppliers have been reluctant to leave the schemes, which must come to an end in a timely manner.
The amendments in the statutory instrument remove the obligation on suppliers to provide the discounts to customers, except in instances when the consumer has lost out due to poor practices by their energy supplier. In those instances, we have provided carve-outs to balance the interests of suppliers with support and protection for consumers. Carve-outs are in place when a supplier has failed to provide their customers with a bill for energy supplied during the scheme period, when unreasonable delays or another failure has led to the energy not being billed accurately, or when the supplier has unreasonably failed in the duty to provide the discount. The customer should not and will not lose their entitlement to the discount in those circumstances.
If any dispute arises between the supplier and the customer in relation to the carve-outs, the resolution mechanisms will be those normally used in the industry, via a complaint to the Energy Ombudsman, investigation and potential sanction by the regulator, Ofgem, or court action. The amendments apply to energy suppliers in Great Britain.
Separately, the regulations amend the Energy Prices Act 2022 to allow the devolved Administration in Northern Ireland to make amendments to address issues in the Northern Ireland scheme. That is because their power to amend their equivalent legislation has expired.
Let me end by saying a few words about the challenges that non-domestic consumers face because of high prices. I know that Members across the Committee are concerned about that. Energy prices for non-domestic customers have dropped below the record peaks during the crisis, but the Government recognise that they remain high and pose issues for some businesses. The Government believe that our mission to deliver clean power by 2030 is the best way to break our dependence on global fossil fuel markets and to protect bill payers, including non-domestic consumers, permanently.
In the short term, the Government are taking action to better protect businesses from being locked into unfair and expensive energy contracts. Last year, the Government launched a consultation on introducing regulation of third party intermediaries, such as energy brokers. That is aimed at enhancing consumer protections, particularly for non-domestic consumers. The consultation has now closed and the Government will respond in due course.
The Government are also empowering businesses to challenge unfair and poor practices by suppliers. Since December 2024, small and medium-sized enterprises with fewer than 50 employees can have access to free support to resolve issues with their energy supplier through the Energy Ombudsman. That expands the service to 99% of British businesses, allowing them to access up to £20,000 in financial awards. Those are important steps, on which we will continue to build.
I hope that hon. Members will support the important regulations, which I commend to the Committee.
Miatta Fahnbulleh
I thank the hon. Member for his response. I am glad that we have consensus across the Committee about the regulations.
The hon. Member is right to point out that energy bills are high. All hon. Members know that, and it is a central focus of the Government’s. I come back to the fact that we inherited a position whereby bills were at record heights. That is a result of our dependence on global fossil fuel markets over which we have no control. I have said this before and I will say it again: the Opposition were happy with that status quo, but we are not willing to put up with it. We believe that it must be changed. Our drive for green power will deliver home-grown clean energy, which will give energy security to the country and financial security to families.
While we do that, our manifesto commitment to reduce bills remains central to what we are trying to achieve. It is the core of everything that the Department is trying to do. We will bear down on bills through clean power and we will ensure that we take short-term action to protect bill payers who are struggling. Critically, we will upgrade millions of homes so that we can deliver lower bills and warmer homes. We are committed to that because we understand that, throughout the country, people face a cost of living crisis, which we inherited from the Conservative Government, who did not do enough to insulate and protect people. We will not make that mistake. We are determined to do this. Again, I commend the regulations to the Committee.
Question put and agreed to.
Oral Answers to Questions
Miatta Fahnbulleh Excerpts(1 month, 2 weeks ago)
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Wendy Chamberlain (North East Fife) (LD)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
The previous Government’s record on fuel poverty was absolutely woeful, and we have had to inherit an incredibly challenging trajectory. We are doing everything we can to shift that by upgrading homes for families in fuel poverty, driving up standards in the rental sector so that we lift 1 million people out of fuel poverty and supporting over 3 million households with our warm homes discount, all while running with our mission for clean power.
Chris Law
Despite Scotland being one of the most energy-rich nations in Europe, decades of mismanagement by different colours of UK Government—whether Labour or Conservative—have led to a shocking one third of households in Scotland living in fuel poverty. That number is set to rise, along with energy bills. The Government were elected on Labour’s pledge to cut energy bills by £300, but yesterday the chair of GB Energy admitted that that was “not in its remit” and was completely unable to say when bills would come down, alleviating fuel poverty. If this is not another broken promise from the Prime Minister, can the Secretary of State confirm exactly when in this parliamentary term consumers in Scotland will see that reduction?
Miatta Fahnbulleh
Fuel poverty is devolved in Scotland. The Scottish Government have had the opportunity to make a dent in this problem for almost 20 years and they have not. Even now, as we are ramping up upgrades to help people with fuel poverty, the Scottish Government are raiding more than £200 million from retrofitting funds that could help families today. I will take no lectures from the hon. Gentleman on how we tackle this problem.
Mr Speaker
I call Wendy Chamberlain. She is not here. I call Frank McNally.
Frank McNally (Coatbridge and Bellshill) (Lab)
I commend the Minister for the announcement of support for those in most need this winter. Given Scotland’s colder climate, does the Minister share my view that, as she has just expressed, the Scottish Government’s decision to cut £200 million from the retrofitting budget is failing people in Coatbridge and Bellshill and across Scotland, and that with record funding from this UK Government in the Budget, they should reverse that cut?
Miatta Fahnbulleh
My hon. Friend is completely right. There is no justification for raiding retrofitting budgets, because we know that is the route by which we upgrade people’s homes to deliver homes that are warmer and cheaper to run. We are doing our bit to drive down energy bills and deliver clean power, which is the route to energy security and financial security. The Scottish Government need to crack on and do their bit.
Chris Webb (Blackpool South) (Lab)
Ms Polly Billington (East Thanet) (Lab)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
We know that this winter has been difficult for many people who are struggling with high energy bills. We agreed the winter support package with industry and Energy UK to get support to the people who need it, and £500 million is being provided through industry. When combined with the support that we are providing through the warm home discount, that amounts to £1 billion for the families who we know need help this winter.
David Williams
As well as residents, businesses in the ceramics sector struggle with high energy bills and face many other pressures. Sadly, only yesterday more than 80 workers in my constituency lost their jobs when Royal Stafford, a historic ceramics manufacturer for nearly 200 years, went into liquidation—a devastating blow for the workers and their families. Will the Secretary of State meet GMB officials, Ceramics UK and me as a matter of urgency to explain how the Government will support the ceramics sector, protect jobs, and tackle the serious difficulties that energy-intensive industries face in decarbonising?
Miatta Fahnbulleh
My hon. Friend is right to point out that we need to reduce energy bills for businesses, including those in energy-intensive industries. I was sorry to hear about the job losses in his constituency, and one of the ministerial team will be happy to meet him. I must add, however, that this is exactly why we are running our clean power mission. We see that the route through which we can drive down bills is breaking our dependence on global fossil fuel markets over which we have no control, in order to take ourselves off the rollercoaster of price rises and price hikes that is so damaging to businesses. While we do that, we are working with Ofgem and industry to ensure that businesses are not being locked into expensive contracts, and to ensure that they have much stronger redress when things go wrong.
Michael Wheeler
I thank the Minister for all her work in this area. I know from conversations with my constituents that energy costs are a large part of the cost of living crisis for them. Following the Conservative party’s failure to protect our energy system and invest in home-grown clean power, can the Minister give us an update on what steps are being taken to tackle my constituents’ high energy bills?
Miatta Fahnbulleh
My hon. Friend is 100% right. The reason we are so exposed as a country to global fossil fuel markets and the rollercoaster that is damaging business and hurting consumers is the Conservative party’s failure to invest in home-grown clean power and to upgrade people's homes to insulate them from high prices. That is a record of which the Conservatives should be ashamed, and it is a record that we are determined to change.
Rachel Hopkins (Luton South and South Bedfordshire) (Lab)
Many households in my constituency are struggling with high energy bills because the last Government left us exposed to the unpredictable fossil fuel market. Does the Minister agree that the only way in which to protect residents in my constituency and across the country permanently is to unlock clean power that we control here in the UK?
Miatta Fahnbulleh
My hon. Friend is completely right. Every solar panel and every wind turbine that we put up takes us closer to delivering the energy security that we need to achieve financial security for families. That, combined with our drive to upgrade people’s homes, is what will protect households in the long term. It is the central mission of this team, this Department and this Government, and it is why we are running at clean power by 2030.
Ms Billington
In anticipation of the energy market reform that the last Government neglected to carry out, I look forward to hearing confirmation from my colleagues on the Front Bench that we may be able to find a way of insulating people in the long term—for the transition to decarbonising heat, for example. Can my hon. Friend confirm that, in future, we may be able to have a social tariff that protects the most vulnerable from the excesses of energy prices?
Miatta Fahnbulleh
I agree with my hon. Friend that we urgently need to tackle the challenge of affordability. Energy is not a luxury good; it is foundational, and for too many people, this essential good is not affordable. A social tariff is one mechanism of responding to this, and there are different ways in which that can be implemented. We are looking at all the options, to ensure that families can get this essential good at more affordable prices.
Dr Andrew Murrison (South West Wiltshire) (Con)
People living in rural locations disproportionately live in housing stock that is older and colder and does not have gas. In the Minister’s discussions with energy suppliers, will she please not forget to talk to the suppliers of liquefied petroleum gas and oil, since many of our constituents—particularly with the withdrawal of the winter fuel payment—are suffering a great deal?
Miatta Fahnbulleh
We are very alive to the issues in rural communities, and we are working to ensure that there are solutions for all types of homes. We had record applications to our boiler upgrade scheme for heat pumps, a large number of which were from rural households. We are very clear as we roll out our plan that there will be a solution for every single household, so that everyone can benefit from homes that are warmer and cheaper to run.
Calum Miller (Bicester and Woodstock) (LD)
This winter, many of my constituents are concerned about energy outages. Last Thursday, the Cooper school and Glory Farm school had to close for the entire day when they lost all electricity supply. Will the Minister meet me to discuss how we can ensure the grid has the capacity to avoid these outages, which are so damaging to homes, businesses and critical public services?
Miatta Fahnbulleh
Yes, we will meet the hon. Gentleman. We are working to ensure that outages are not the norm. This is obviously linked to weather issues that we are having to respond to, but the team has been working to ensure that households are not put in a difficult situation, and when they are, that we are responding as quickly as possible.
Dave Doogan (Angus and Perthshire Glens) (SNP)
What would help bill payers is the £300 cut to energy bills that the Labour party promised in its manifesto. Instead, bills went up £149 in October, they went up £21 in January, and they are going up again by £99 in April. Can the Minister explain where the source of this departmental ineptitude lies, and would she like to apologise to the people of these islands for writing cheques that her party cannot cash?
Miatta Fahnbulleh
The hon. Member explains exactly why we need to wean ourselves off fossil fuel markets. That is why it is critical that we deliver clean power by 2030—that is the central mission of this team, and we are running at it. The Scottish Government do have the levers to protect households in fuel poverty. Before the hon. Member criticises us, they should get their house in order and get on with the job.
Sir Ashley Fox (Bridgwater) (Con)
Prior to the election, the Secretary of State promised to cut my constituents’ energy bills by £300. Would the Minister repeat that promise at the Dispatch Box?
Miatta Fahnbulleh
We have a manifesto commitment to reduce energy bills by £300. We are doing everything we can. We have a legacy of record high energy bills. We are running at clean power because we think that is the route to delivering lower energy costs. We are upgrading people’s homes because we know that is the route to delivering homes that are warmer and cleaner to run. We are doing everything we can. The Conservative party oversaw a crisis for households, so before its Members start lecturing us on what we should do, they should be hanging their heads in shame.
Patrick Hurley (Southport) (Lab)
Jessica Toale (Bournemouth West) (Lab)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
The warm homes plan will upgrade up to 5 million homes with low-carbon solutions such as heat pumps, solar and insulation to deliver homes that are warmer and cheaper to run. We have already kick-started delivery, with up to 300,000 homes being upgraded this year alone. We will set out our plans in the spring on how we will ramp this up.
Anna Dixon
In 2023, it emerged that a number of substandard retrofitting works were carried out as part of Government schemes. In some cases, properties were left with structural damage. When households sought redress, they found that many of the authorised contractors had folded, and they have been left to pick up the bill. Will the Minister assure me and my constituents in Shipley that, under the warm homes plan, sufficient safeguards will be put in place to protect households from rogue companies?
Miatta Fahnbulleh
My hon. Friend raises an important point. We are aware of too many cases where home upgrades have not been done to the required standard. We are very clear that the ad hoc, fragmented system of regulating home upgrades that we inherited from the last Government is in dire need of reform. We will overhaul that system so that when people have home upgrades, they can be confident that they will be of the highest standard and that when things go wrong, they will have as much protection as possible and redress within the system.
Deirdre Costigan
The previous Government were content to sit back and allow developers to build homes that have locked people into years of expensive and dirty gas heating. How will the Minister ensure that the 1.5 million new homes the Government will deliver will not keep people dependent on outdated and costly gas heating systems?
Miatta Fahnbulleh
My hon. Friend is absolutely right; the new homes we build must be fit for the future and must be decent homes that comply with our carbon standards. We are working with the Ministry of Housing, Communities and Local Government to bring forward the future homes standard, and we will set out our plans for that in due course.
Jessica Toale
I have been shocked by the number of mouldy and damp homes that I have visited in my constituency. No one should be forced to live in such conditions. We have some of the leakiest homes in Europe as a result of the last Government’s failure to deal with the problem. Will the Minister tell me how our warm homes plan will improve housing conditions and bring down bills for my constituents in Bournemouth West?
Miatta Fahnbulleh
Cold, damp homes that are hard to heat are the reality for too many households in this country. That is the legacy of the party opposite and a legacy that we are absolutely determined to turn around. We are committed to upgrading homes in the rental sectors with our minimum energy efficiency standard so that we can make cold, draughty homes a thing of the past. We will ramp up our warm homes plan so that my hon. Friend’s constituents and constituents across the country will benefit from homes that are warmer and bills that are lower.
Sir Julian Lewis (New Forest East) (Con)
Will the Minister acknowledge the amazing contributions of groups such as New Forest Friends of the Earth, which this very morning have been lobbying their MPs in Parliament Square on warm homes initiatives? They will be coming to the Government with some possibly costly proposals, but I hope that the Government, despite the economic legacy that they allegedly inherited, will give them a sympathetic hearing.
Miatta Fahnbulleh
I thank the right hon. Gentleman for reminding us about our economic inheritance. We are reaching out to organisations and stakeholders across the country—industry, charities and third sector organisations—to feed into our warm homes plan, so we are keen to hear ideas. We are conscious that we have an ambitious programme and we need to do a big scaling-up of home upgrades across the country, so we are definitely in the market for hearing from and reaching out to organisations that can come up with ideas.
Sammy Wilson (East Antrim) (DUP)
Is it not a fact that, regardless of how much money is put into a warm homes scheme, social tariffs or whatever, consumers can never be insulated against the massive cost of the mad net zero policy that will require thousands of new turbines, acres of solar farms and miles of new transmission lines, all at a cost to the consumer? How on earth does the Minister believe that we will deal with the issue of fuel poverty in this country with that cost?
Miatta Fahnbulleh
I will say to the right hon. Gentleman that at the moment, families are not insulated from fossil fuel markets. We have seen one of the worst energy crises, which has had a huge impact on the cost of living. The status quo is not tenable. We already have record-high energy prices and the only way that we are going to bear down on that is through clean power. The alternative is to do nothing—but we have seen the impact of doing nothing over the last 14 years and consumers and constituents across the country are the ones being impacted. We will absolutely drive forward with clean power by 2030 because that is our route to providing an energy system that delivers energy security and that can deliver financial security.
Jim Shannon (Strangford) (DUP)
The Minister came to the House previously and gave us some encouragement about the warm homes scheme and how it has been discussed with the regions, the Northern Ireland Assembly in particular. Since that statement, has she had the opportunity to speak to the relevant Minister in the Department of Enterprise, Trade and Investment in Northern Ireland to ensure that we can all gain from the warm homes scheme, which the Minister is proposing in a positive fashion?
Miatta Fahnbulleh
We are speaking to all the devolved Administrations. We are constantly engaging with them, including in our inter-ministerial group. On this specific issue of home upgrades and how we drive up standards, we are working with the Scottish, the Welsh and the Northern Ireland Administrations.
Andrew George (St Ives) (LD)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
Home insulation delivers warm homes and lower bills. I have visited Government-backed schemes across the country and seen their impact on households and consumers, but we also know that there are too many examples of homes not being upgraded to the required standard. We are not happy or comfortable with that. We are committed to overhauling system so that when people have home upgrades, they can be confident that they will be of the highest standard and that, if things go wrong, they will have redress so that we can take them on this journey with us.
Andrew George
Further to the questions raised by the hon. Member for Shipley (Anna Dixon) and several other hon. Members, I, too, have picked up numerous cases in my constituency of Government-sponsored defective home insulation work and of extortionate, poor-quality and defective work of unscrupulous cowboy contractors who masquerade as operating under Government schemes. This includes Mrs King in Helston in my constituency who has paid out £19,000 to have insulation installed and then removed. I am pleased with the Minister’s response, but surely the Government need to do more to give householders confidence that these projects are both cost-effective and provide proper redress.
Miatta Fahnbulleh
The hon. Gentleman is right: it is just not good enough for any householder to get a home upgrade that is not up to standard. I am sorry to hear about the example of Mrs King. We are working with Members across the House on supporting a number of individual cases. If it is a Government-backed scheme that is at fault, mechanisms are in place for the work to be remediated at low cost. But, at the end of the day, we have acknowledged that the system requires root and branch reform so that when consumers opt for upgrades they can have the confidence of knowing that they will deliver what we are saying: warm homes that are cheaper to run.
Madam Deputy Speaker (Caroline Nokes)
I call the Chair of the Energy Security and Net Zero Committee.
Bill Esterson (Sefton Central) (Lab)
Next week, the Select Committee will be hearing from some of the victims of the botched solid wall insulation installed under the previous Government’s energy company obligation and GB insulation scheme. That includes people whose homes may well have to be rebuilt, as the cost of repairing the damage may be higher. Will the Minister tell us how such a thing could have happened, and will she confirm that she is happy to come back to the Select Committee to add to the comments that she has already made about rebuilding consumer confidence after the disaster under the previous Government?
Miatta Fahnbulleh
What is clear to us as a new Government is that the system of regulating home upgrades was too ad hoc and too fragmented. Accountability was not clear enough and consumers were not at the heart of the system. We are committed to turning around that system. Put simply, when someone has a home upgrade, they need to have the confidence that it will work for them and that, when things go wrong, redress will be put in place. I am committed to update the Select Committee on the progress that we are making on getting a grip of what we have inherited and on making sure that such a thing never happens again for consumers.
Pippa Heylings (South Cambridgeshire) (LD)
As we have been hearing, Dickensian conditions of cold, damp and mouldy homes are shamefully on the increase. In my constituency, more than 4,000 households are having to make that difficult decision between eating and heating because of the previous Government’s dither and delay on insulation. However, even now, local authorities and families are in limbo, anxiously awaiting confirmation of the 2025-26 funding for ECO4 and the Great British Insulation scheme through a ministerial statement. Will the Minister act with the urgency that is needed to bring those schemes and the warm home scheme forward to tackle fuel poverty?
Miatta Fahnbulleh
I thank the hon. Member for pointing out the inheritance and the legacy. That is material, because it is the backdrop to everything we are trying to do. We are clear that we need to drive forward with momentum and pace. That is why we are already upgrading up to 300,000 homes this year alone. It is also why we are working with local authorities and social housing providers to deliver warm homes that are cheaper to run for communities across the country. We are absolutely moving at pace with our warm homes plan. We will be setting out that plan, and at its heart is an ambition to ramp up the number of upgrades massively, so that more families across the country can benefit from what we know works: warm homes and lower bills.
Victoria Collins (Harpenden and Berkhamsted) (LD)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
We know that people are frustrated with standing charges, and we are committed as a Government to reducing them. As an initial step, the regulator Ofgem is consulting on giving people the option of no standing charge tariffs within the price cap, and we will continue to work with the regulator to ensure that we lower standing charges in the fairest way possible.
Victoria Collins
Lesley from Tring is one of my constituents who just missed out on the winter fuel allowance. She said she will be
“spending most of the winter in bed”
because she is struggling with energy costs. While so many are struggling with the cost of energy, standing charges disproportionately affect those on lower incomes such as Lesley. Will the Government meet Ofgem to discuss those disparities and prepare detailed action to review standing charges for a fairer system?
Miatta Fahnbulleh
I am sorry to hear about the case of Lesley, and I know there are people across the country who have this frustration with standing charges. I reassure the House that we have a commitment to reducing them. We are working with Ofgem on a set of options. Our challenge is to ensure that standing charges do not penalise some households and that they are as fair as possible. That is what we are committed to doing, and that is what we are working every day to deliver.
Greg Smith (Mid Buckinghamshire) (Con)
Tim Farron (Westmorland and Lonsdale) (LD)
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I am happy to meet the hon. Gentleman. We know that we have a job to do to ensure that all insulation is up to standard and that we have the right measures for every type of household. I am keen to engage with him and Members across the House.
Alistair Strathern (Hitchin) (Lab)
The UK has a fantastic £26 billion clean tech sector, leading the way in innovation and carbon reduction for everything from clean power to sustainable agriculture. However, all too often, red tape and bureaucracy are locking in dependency on fossil fuels and foreign oil and gas. How can we work across Government to cut back on this unnecessary red tape, and ensure that our schemes support the leading tech and innovation that our best-of-British producers are bringing forward?
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Miatta Fahnbulleh
The right hon. Member is right to raise this issue. We have to deliver on the teleswitching transition. We are behind where we need to be, but we are working with industry and Ofgem to make sure that households are not left in the dark, and that everyone can upgrade to smart meters, which will be much better for them. I am keen to work with him and Members from all parts of the House to make sure that we get this right for his community and other communities that are affected.
Sarah Champion (Rotherham) (Lab)
The Government procurement budget is around £300 billion. Can the Minister please tell us what percentage of his allocation will go to British businesses? Will he confirm that where we have to import, no modern slavery will be imported into this country?
ECO4 and Insulation Schemes
Miatta Fahnbulleh Excerpts(2 months ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
With permission, Madam Deputy Speaker, I would like to make a statement about the energy company obligation 4 and Great British insulation schemes. The Government have identified an emerging issue of poor-quality solid wall insulation installed under those two inherited schemes.
Energy company obligation 4 began in April 2022, and the Great British insulation scheme began in May 2023. Around 65,000 households have had solid wall insulation installed under the schemes. In October 2024, TrustMark, the independent body that oversees tradespeople working in homes, did routine audits and found significant examples of solid wall insulation under those schemes that did not meet the requisite standard.
At that point, TrustMark began suspending a number of the installers responsible. After officials in our Department were made aware of the issues, they asked TrustMark to conduct a much fuller audit, which concluded in mid-December. Officials informed Ministers at the start of December about the situation, and told them that early findings suggested that there were widespread cases of poor-quality installations that did not meet the required standard. Since that point, we have consulted the certification bodies responsible for overseeing the work, and the Building Safety Regulator, to understand the true scale and nature of the emerging problem.
It became clear to me that there is a serious systemic issue around ECO4 and GBIS solid wall insulation. It ranges from minor problems, such as missing or incomplete paperwork, to major problems, such as exposed insulation or poor ventilation, which, if not fixed, could lead to damp and mould. As more poor-quality work has come to light, a total of 39 businesses have been suspended from installing new solid wall insulation in people’s homes. I can inform the House that suspended installers will not be able to deliver new solid wall insulation under any Government schemes until they have fulfilled their obligations to put any issues right.
Additional on-site audits are being conducted as I speak, so that we can get a full picture of the scale of the problem and identify affected households. The auditing work continues at pace, and we have put in place a comprehensive plan for immediate repair and remediation where needed. Let me be absolutely clear about this: installers must fund any repair work themselves and carry it out as soon as possible. Consumers should not be asked to pay a penny towards the cost of getting the problems fixed.
We have instructed Ofgem, the energy regulator, to oversee that work. Ofgem will work with TrustMark and certification bodies to ensure that it is delivered at speed. Non-compliant work found through the audits is already being fixed. In the very small number of cases in which TrustMark audits found health and safety concerns, including wires not being fitted properly, the problems are being fixed urgently, with the expectation that they should be resolved within 24 hours.
Critically, I reassure the House that additional monitoring and checks are being put in place to ensure that future solid wall insulation is done to the requisite standard. It is also important to say that, based on what we know so far, we believe that the issues we have discovered are specific to solid wall insulation installed under ECO4 and GBIS. Stronger systems of checks and balances are in place for other schemes that involve local authorities and social housing providers, so we do not expect to see the same scale of problem there. However, the Government are reviewing the quality of solid wall insulation under other schemes. I will update the House on the results of that work as soon as they are available. We will continue to require the urgent remediation of any issues found across all Government energy efficiency schemes.
I know that this will be concerning news for families who have had solid wall insulation fitted through those schemes. Getting this sorted for those customers is our No. 1 priority. Since I was informed of the problems, I have worked with Ofgem to develop a full plan for assessing all affected properties and getting any problems fixed. Let me set out what our plans mean for those families. Ofgem will now oversee quality checks on all solid wall insulation installed under either scheme, to identify households that might be affected. That will begin with every measure being examined over the coming weeks by qualified professionals, and that will include looking at photographic evidence. If a quality check raises issues, the certification body that oversees the installer, or TrustMark, will arrange an inspection of the property and the problem will be fixed as soon as possible. Installers will be required to provide evidence to TrustMark that issues have been properly fixed. Let me reiterate our assurance that where solid wall insulation under the schemes has not been done right, consumers should not have to pay a penny to fix that.
We are clear that the responsibility for finding and fixing any problems lies with those who carried out the work. Consumers do not need to take any action now. However, given the inevitable concern among those who have had those measures installed, all households with solid wall insulation fitted under the schemes will be sent a letter from Ofgem in the next three weeks. It will set out the steps that we are taking, and how households can proactively raise concerns. We are also setting up a gov.uk advice page specifically for those affected.
The Government are moving fast to protect households, but I must be honest with the House: these issues are the result of years of failure in a system that must be reformed. Home upgrades are, we believe, one of the best tools to get bills down for good and deliver warm homes. That is why our warm homes plan will cut bills for millions of households by upgrading their homes, including with solar panels, batteries, heat pumps and energy efficiency measures such as double glazing and loft insulation. However, the Government have inherited a fragmented and confusing system of protections for people who want to insulate their homes—too many organisations with different roles and responsibilities, not enough clarity for consumers about who to turn to if things go wrong, and problems that should have been picked up earlier being missed. The system is in dire need of reform.
Installers are responsible for poor-quality installations, but they have been allowed to operate in a failed system that has left some households exposed to bad practices. The system can no longer command confidence, which is why we are committed to overhauling it, and to driving up quality and protecting consumers through the warm homes plan. We will look at the entire landscape —from how installers work in people’s homes and are certified and monitored, to where homeowners turn for rapid action and enforcement if things go wrong—and we will ensure that there is more of a guiding mind overseeing upgrades across the system.
The steps I have set out demonstrate that the Government will do whatever it takes to protect consumers. We will regularly report back to the House about the steps being taken. We have set up a process through which colleagues from across the House can raise concerns about their constituents. Above all, we are determined to ensure that families are never let down in this way again. We will put in place a robust system of compliance, audit and regulation, so that consumers have the confidence to take up the offer of upgrading their homes. We will do what is necessary to ensure that families can have warmer homes and lower bills. I commend this statement to the House.
Madam Deputy Speaker (Judith Cummins)
I call the shadow Minister.
Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
I thank the Minister for advance sight of her statement, and for taking the time to meet me this morning prior to making the statement.
The ECO scheme and the Great British insulation scheme were set up because we know that improving the energy efficiency of homes is one of the best ways to cut energy bills and keep people warm. This is especially the case for those who are in fuel poverty. When we took office in 2010, just 14% of homes in this country had an energy performance rating of A to C; today, that figure is around 50%, and for social housing, we went from 24% in 2010 to 70% today. That is a record that we are proud of—a record of reducing bills for households and keeping families warm. Almost half of the measures installed under GBIS have been in low-income households.
Solid wall insulation is a small proportion of the overall work that the ECO scheme and the Great British insulation scheme undertook. The vast majority of installations under those schemes have been cavity wall and loft insulation, alongside installations of smart thermostats and boiler upgrades under the ECO scheme. However, it is deeply concerning that examples of substandard solid wall insulation have been identified in some of the installations under those schemes. We of course support the action that the Minister has announced today, and Ofgem being given responsibility for overseeing the repairs and remediation, and it is right to conduct additional on-site audits to inform action moving forward. I thank TrustMark for the work it has done to identify examples of poor-quality solid wall insulation, and we also welcome the fact that there will be a review of the quality of solid wall insulation under other schemes. It is absolutely right for installers to fund the repair work, and to ensure that the situation is remedied for affected households as soon as possible. Nobody should have to live in a house with damp or mould as a result of poor-quality insulation.
Could the Minister, in addition to taking the action that she outlined in her statement, please answer the following questions? First, have the audits undertaken so far identified what proportion of the solid wall insulations are affected by poor-quality work? Can she confirm that all 39 companies that have been suspended still exist, and set out the mechanism by which they will be required to remedy their work? What action is being taken to make sure that remedial work is of the required standard, to ensure that consumers are protected from yet more poor-quality work? What action is the Minister taking to make sure that everyone who had solid wall insulation installed under the schemes is informed promptly and in full, and that nobody will be missed? Will she publish a full list of the 39 companies suspended from the scheme for carrying out poor-quality work, and has the Department considered taking legal action against them?
Members in all parts of the House want to ensure that families have a warm and comfortable home that is efficient and cheap to run. The Minister has our assurance that we will work cross-party to ensure remediation for those affected.
Miatta Fahnbulleh
I thank the hon. Member for his response. I am glad that there is consensus across the House that energy efficiency measures and home upgrades are key to delivering warmer homes and lower bills, and I hope all Members are supportive of the action the Government are taking.
In answer to the hon. Member’s questions, we are still conducting audits to get a full picture. From sampling that has been done—I stress that the sampling was geared towards the installers that we thought were most risky—it seems that a significant proportion of that sample has major issues, which is why we are taking this action. On the 39 installers that have been suspended, we are working through certification bodies and TrustMark to require them to go into households and remediate the work. In the cases that we have audited, that is happening. The vast majority of installers want to do the right thing and want to do a good job, and where issues have been flagged, they are repairing the work. Where we think there are problems, we have mechanisms in place for making sure that the installers deliver on their obligations, and the guarantee system acts as a backstop.
A crucial question is how we ensure both that where remediation work is being done, it is being done to the right standard, and that future solid wall insulations are done to a better standard. We are putting in place additional spot checks across the piece to make sure that where work has been remediated, it has been done to the required standard, and critically, all solid wall insulations will be given more monitoring and checks. Suppliers have committed to that, so that when people are having this work done, they can be confident that it is being done to a much better standard than we have seen.
On keeping everyone informed, we will be writing through Ofgem to all households that have had solid wall insulation installed. We will be doing quality checks on all 65,000 solid wall insulations. I should stress that we hope the vast majority of those will be okay and that any issues will be minor, but we want to do a quality check across the piece. Our priority is getting in, making sure we are doing a proper inspection of the property, and getting key issues remediated as quickly as possible. Through all of that, our priority is the consumer, whose experience has to be as hassle-free, stress-free and cost-free as possible. This should never have happened in the first place, and we are determined to get this right and fix it on those consumers’ behalf.
Imran Hussain (Bradford East) (Ind)
As the Minister knows, I have long campaigned in this area, and I am grateful to her for meeting my hon. Friend the Member for Burnley (Oliver Ryan) and myself, along with the SSB victims support group, last year to discuss these important issues. As such, I welcome the concrete steps that the Minister intends to take in this area. She will know that many of the victims of the SSB Law scandal were directly impacted through faulty cavity wall insulation, but the steps that the Minister has outlined today are about solid wall insulation. Can she confirm that exactly the same actions will be taken when we are dealing with cavity wall insulation, and if not, why not? Will she also agree to make sure that compensation is available—whether through remedial work or in other ways—for all those impacted by the cavity wall insulation scandal?
Miatta Fahnbulleh
I thank my hon. Friend for his avid and consistent campaigning on these issues. As he knows, there is an ongoing investigation into the case of SSB Law at the moment.
To answer my hon. Friend’s specific question, for any insulation that is installed under Government schemes, we expect that the system will kick in and respond. We are aware of cases that have been raised with TrustMark and other bodies, and we are working to make sure those are remediated. Where the insulation has not been installed under a Government scheme—we have examples of that, where constituents have engaged with insulation schemes that are not Government schemes—there is a different set of mechanisms. We are working with the system to make sure we are responding to households, because as I have said, this is not the fault of individual households; the system is not working properly. We are going to prioritise Government schemes, because we have the levers, but we recognise that there is an issue for households that have had work done outside Government schemes.
Madam Deputy Speaker (Judith Cummins)
I call the Liberal Democrat spokesperson.
Jess Brown-Fuller (Chichester) (LD)
I thank the Minister for advance sight of her statement. I can only imagine the frustration that consumers feel when they go through the quite often complicated process of trying to upgrade their home to bring down their bills for good, only to be met with substandard work and a subsequent lack of enforcement. Liberal Democrat Members recognise that the Government have inherited a fragmented and confusing system, and that the focus today is on consumers and on remedial work affecting the shoddy work they have had installed. I am glad that the Government are committed to ensuring that the onus of that remedial work does not land in the pockets of consumers.
We agree that the system needs a complete overhaul, especially since the last Conservative Government left the Great British insulation scheme falling woefully short of the targets it set for itself and supporting far too few people far too slowly, while some who did receive installations have found them to be well below the required standard. If faults are found with other energy efficiency measures, will the Minister guarantee that consumers do not have to pay a penny for those, as for the ones she has highlighted? How soon can consumers expect their quality checks to be delivered, and will priority be given to households in fuel poverty as well as to the elderly and the vulnerable?
Miatta Fahnbulleh
I thank the hon. Member, and I am again glad to hear that she agrees we need a big overhaul of the system, which is absolutely our focus and our commitment. On other measures under ECO and GBIS, audits are not finding the same scale of systemic problems. We think the problem is focused on solid wall insulation in particular. We are doing stress tests and additional audits of other measures to make sure, but we think there is a specific problem with those measures, so we are focusing on them and moving at pace to get them remediated. Where we are finding major issues, we are setting expectations that that work is prioritised, and installers are coming in and remediating it as soon as possible.
Under the existing publicly available specification framework, remediation after installers have not put the work right has to be done within 12 weeks, and we are setting the expectation so the system moves at pace to respond to consumers. We will absolutely be looking to prioritise households in fuel poverty and vulnerable households. We are doing two things: we are contacting them, but we will also create the ability for people to reach out if they are worried or vulnerable, so that we are doing the necessary triaging and, critically, getting into properties to fix work that has not been done right.
Oliver Ryan (Burnley) (Lab/Co-op)
I sincerely thank the Minister for her great work on this. In the six months she has been in post, she has made more progress than the last lot did in 14 years. This has been a serious problem for victims in Burnley, so I thank her. I am glad she is looking at earlier schemes, too, because many homes have fallen victim to cowboy builders and failed insulation over several years. I look forward to her updates on earlier schemes, which needed to be actioned by the previous Government but were not, and were ignored for an awful long time. I particularly welcome the stronger regulation, the clarity for consumers and the clear process for complaints, which will make a genuine difference.
I have two questions. Will the bans on particular companies follow the directors of those companies? Too often, we have seen companies being established and putting in poor insulation, and then the directors go away, extinguish the company and start again somewhere else. As my hon. Friend the Member for Bradford East (Imran Hussain) asked, will this cover cavity wall insulation where it has been Government-backed?
Miatta Fahnbulleh
I thank my hon. Friend for all the work he has done on this, and for engaging with me and my Department. We are aware of instances where companies have folded so as not to deliver on their obligation to remediate work, and have then set up again. We are putting in place processes through the certification bodies to mitigate that, with a clear expectation that companies will not be taken on by another certification body if they do not get the work right.
Our priority at the moment is solid wall insulation, because that is where we think there is an immediate problem with ECO and GBIS. We are aware, from Members contacting us, of the wider issues that need to be addressed. I come back to the fact that we understand that the system has not been working for consumers. Quite frankly, the quality—and quality assurance—across the system has been far too fragmented and patchy. Critically, consumer protection has not been underscored in the way it needs to be. We are looking to overhaul the system, and we are conscious that there are issues with other schemes and are thinking about the best way in which we can resolve them.
Sir Edward Leigh (Gainsborough) (Con)
I refer the Minister to the last words in her statement, which were that the Government will “ensure that families have lower bills.” There will always be a problem with insulation in a country with a massively degraded and older housing stock, which underlines the vital importance of cheap energy. We have had a month with virtually no wind and no sun, and so-called green energy is producing hardly any of our energy. We are importing energy, we are stopping drilling in the North sea and we are not building gas-fired power stations. What about old people? Their heating allowance has been taken away, and we are crucifying them with ever higher bills. Meanwhile, China—its annual increment in emissions is more than our entire emissions—is going on pumping out emissions, and “Drill, baby” Trump is pumping out emissions. Why are we crucifying our old people?
Miatta Fahnbulleh
I would say to the right hon. Gentleman that the status quo is not fit for purpose. He says we should not take action, yet the last Government presided over the worst energy crisis we have seen for a generation. Over the past two and a half years, we saw his model result in record energy bills. The Conservatives were willing and content to accept that, and they thought it was tenable. It is not acceptable to us. Our view is that we have to wean ourselves off our over-reliance on global fossil fuel markets that are volatile and that, critically, will not guarantee lower bills.
We are committed to delivering clean power—yes, because it delivers on our climate requirements, but critically because we think that that is the route by which we will deliver homes that are warmer and cheaper for consumers. At the heart of everything we are doing is ensuring that consumers—who rely on energy not because it is a luxury good, but because it is absolutely foundational—have energy at stable prices that they can access and afford. This is not a status quo we are willing to accept, and that is why we are taking action.
Terry Jermy (South West Norfolk) (Lab)
I thank the Minister for her statement, and I commend her for the work she has been doing. It must be said that we have inherited an almighty mess from the previous Government, which is incredibly frustrating. She will know how important this issue is to my constituency, which is rural, with too many people on low wages. We have more than our fair share of poorly insulated homes, and fuel poverty is therefore a real concern. Can the Minister reassure my residents, and I am sure many residents across the country, that the news of this latest setback will not delay progress on the improvements in rural communities such as mine?
Miatta Fahnbulleh
I thank my hon. Friend, and we are absolutely committed to upgrading people’s homes. We believe that that is the route to delivering warmer homes that are cheaper to run, and that commitment stands for all communities. We want to move at pace with our warm homes plan because we want to deliver upgrades in people’s homes. However, we are very clear that part of that has to be an overhaul of the system, because if consumers want to go on this journey, they need to be confident that the work done will be of the utmost quality and standard, and that if things go wrong, we have proper redress systems in place. That is not what we inherited, but it is absolutely what we must deliver.
Christine Jardine (Edinburgh West) (LD)
I welcome what the Government are saying about the need to address this issue, and it will be reassuring for the very many people who have raised the problem with their MPs. However, are they also going to look at whether there is a wider problem with insulation generally, as has been mentioned, and have they had discussions with the devolved Administrations about schemes in the wider UK?
Miatta Fahnbulleh
I thank the hon. Member, and yes, we have spoken to the devolved Administrations. We have spoken to the Scottish Government and the Welsh Government, and we are working closely and collaborating with them. It is important to stress that schemes operate in slightly different ways. In the case of the Welsh Administration, we think greater checks and balances are in place in the schemes with local authorities and social housing providers. I think there is a collective appetite and desire to work together, because everyone agrees that home upgrades are fundamental to delivering warmer homes and cheaper bills. We need to get the delivery right to make sure we deliver at the scale and pace of our ambition, but do so with quality at the heart of it.
Nick Smith (Blaenau Gwent and Rhymney) (Lab)
I thank the Minister for her statement. Parts of my constituency are 1,000 feet above sea level and our winters can be bitter, so good-quality insulation schemes are really important. I welcome the Minister’s emphasis on much better standards, but on a wider scale, can she please tell me how she is going to grow the workforce needed to deliver these initiatives for the future?
Miatta Fahnbulleh
My hon. Friend is absolutely right: building the supply chain and the workforce will be critical to delivering the pace and the scale of our ambition. We are already putting in place training schemes to build up the next generation of installers, and we are working with local and regional government on how to build our supply chain. A key part of the warm homes plan will be working with a range of organisations from local to national level to build the supply chain and ensure that, through that, we are delivering quality jobs that pay a decent wage. This is a big opportunity. There is an opportunity for consumers, but we also believe that this is good for the economy, including particular local economies, and working with local and regional government to ensure that we realise that is a priority.
Harriet Cross (Gordon and Buchan) (Con)
I thank the Minister for her statement, in which she confirmed that the 39 suspended companies are suspended from providing new solid wall insulation under the scheme. Are they also suspended from providing other sorts of insulation, such as external, loft and cavity wall insulation?
Miatta Fahnbulleh
We have suspended the 39 companies, and under Government schemes they will not be doing any work on solid wall insulation. The vast majority, particularly those installers that TrustMark believes are risky, are prohibited from doing other work. Where we have evidence that some of the companies are delivering loft insulation, for example, and other measures to standard, they are allowed to do that, but we are keeping this closely under review. TrustMark is looking at the 39 companies constantly, and there is a big onus on the requirement on those companies to deliver and remediate the work in order to be able to any further work.
Julia Buckley (Shrewsbury) (Lab)
I congratulate the Minister on her sterling work to tackle this minefield of rogue companies who abuse the good will of residents when installing energy saving measures, by scamming them with substandard products and damaging their homes. Will she work with colleagues in the Ministry of Housing, Communities and Local Government to consider extending the scope of this excellent regulation to look at spray foam insulation? My historic market town constituency of Shrewsbury has many beautiful older properties and many older residents. It saddens me that it was elderly residents such as David and Sue, and Mr and Mrs Balcombe, who were approached by ruthless companies offering spray foam insultation, despite the fact that it was inappropriate for their older properties. As a consequence of the damage caused, those families have faced bill after bill for surveys and remedial work, costing tens of thousands of pounds. Crucially, they are now struggling to sell their homes, as lenders will not approve mortgages for homes with faulty spray foam insulation. David and Sue now face bills to replace their roof, and sadly Mr Balcombe passed away recently, leaving his widow to continue the fight for a resolution to this nightmare. May I ask that families such as those be considered for the same enhanced regulation and compensation scheme?
Miatta Fahnbulleh
I thank my hon. Friend for raising the issues in her constituency. We are aware of the issues with spray foam insulation—indeed, a number of Members from across the House have raised it with us—and we are working with MHCLG. For example, we have done a lot of work on mortgages, and have worked with lenders to ensure that there is not a blanket policy of not giving mortgages where there is spray foam insulation within the property. We acknowledge that there is a problem and that we need to strengthen the regulation, assurance and consumer protection across the piece with all energy efficiency measures. That is why, alongside remediating the immediate issues that we find within ECO4 and GBIS, we are working at pace to deliver wholesale regulation of the way the system works.
Bob Blackman (Harrow East) (Con)
Over the past 14 years, I have regularly raised the building industry and its failures to provide decent homes of decent quality. The one strand that follows all the way through is the failure properly to inspect independently work that has been carried out, to certify it, and to ensure that it is fit for purpose. Will the Minister ensure that, beyond the current audit, all future work is properly inspected, certified and signed off, so that the people receiving the insulation can feel confident that the work has been done properly?
Miatta Fahnbulleh
The hon. Gentleman is right. There is a poor and weak system of inspection, certification and assurance. We believe that that is one of the reasons why we have ended up where we have, and we are clear that we must reform that part of the landscape. In the end, we must command the trust and confidence of consumers, and problems such as this fundamentally undermine that trust and confidence. As part of reforming the system we will look at how we inspect work when it is done, how we monitor what has been done and, critically, how we can have that assurance so that when consumers have work done, they can be confident that it is done to the highest standard.
Henry Tufnell (Mid and South Pembrokeshire) (Lab)
I commend the Minister for her statement. I have heard from many constituents in Pembrokeshire who have been affected by these schemes, with incorrect insulations of air source heat pumps, faulty or shoddy building work, lack of valid warranties, grant misuse, and regulators such as TrustMark simply siding with the contractors. All of that has a disproportionate effect on vulnerable groups. Does the Minister agree that it is only thanks to this Labour Government that we are finally sorting out the failed system of regulation?
Miatta Fahnbulleh
My hon. Friend is right to highlight the problems we are finding across the piece. We are clear that the system we inherited is not fit for purpose. It is a patchwork of disjointed, fragmented regulation and consumer protection, it is frankly a nightmare for consumers to navigate through, and it is not fit for purpose. There has to be a root and branch overview of how the system works. Our priority is to ensure that if consumers choose to do home upgrades, it is as easy as possible for them to navigate the system, and they can have quality. The difference between this Government and the previous one is that we believe there is a role for Government. There has to be a guiding mind overseeing home upgrades across the piece, and we must ensure that the system is delivering for consumers.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
I welcome today’s statement, but it is not just about solid wall insulation. It is not right that anybody has to take any ECO4 supplier to the small claims court to get recompense for fixing shoddy work. TrustMark as a process is intrinsically ill-designed to protect vulnerable people, because it presumes that acceptance of a supplier on to the scheme is a sufficient safeguard. Will the Minister consider—I bear in mind what she has already said—empowering local authorities to sign off work before a penny is paid?
Miatta Fahnbulleh
The right hon. Member is right to highlight the important role that local authorities can play. Across the country, including in Wales, where local authorities or regional government are overseeing this work and providing additional quality and checks, we are not seeing the same scope of problems. We are looking at this in the round. We are clear that the status quo is not fit for purpose and that we must put in additional checks, balances and assurances. We think there are lessons to be learned from what is happening in Wales and Scotland, and what is happening in regional and local government.
Clive Efford (Eltham and Chislehurst) (Lab)
I welcome my hon. Friend’s statement, and congratulate her on the detail with which she is answering questions and on showing how much she is on top of her brief. Only on Friday, a constituent came to see me who had a new boiler fitted and insulation done under an ECO grant. The work had been subcontracted by the company that originally won the contract, and that something that exacerbates the problem. That company clearly was not up to the standard required to carry out the work, and lots of remedial work was required. How can we ensure that the people who win these contracts do not subcontract to companies that are not capable of carrying out the work, meaning that we end up with the situations the Minister has described?
Miatta Fahnbulleh
My hon. Friend is right to highlight subcontracting within the system. Often we find that subcontracting is happening two or three times, and the starting client is not overseeing the work in the way that they should. That is why we are clear that we must look at the entire system, and part of that is looking at who is delivering the work, how they are delivering it, and how we ensure that there is proper accountability in the system. It is obvious to me that the current system does not allow for that accountability, and that is what puts consumers in a difficult position.
Tom Gordon (Harrogate and Knaresborough) (LD)
I am sure the Minister will recall our intimate Adjournment debate before the House rose for the Christmas recess—it was just her and me here. [Interruption.] Yes, and it was the day after our Christmas party, so it was an interesting debate.
I sincerely welcome the steps that the Minister has outlined for solid wall insulation. The problem I have is that, fundamentally, all these issues apply to spray foam insulation, as I said in my Adjournment debate. There are blanket bans by some mortgage providers: research by the BBC showed that one in three of the top 12 mortgage lenders have such policies. I am more than happy to send on that information again. There is a real issue of fairness and justice here. It is right that we are seeking to get this right for people done wrong by those who have not installed insulation to spec, but the same must be true for those who are victims of the spray foam insulation scandal, including my constituents Tom and Norma in Knaresborough.
The Minister has acknowledged in her statement that there are systemic issues, that TrustMark is not doing its work and that there are to be audits of solid wall insulation. However, when I asked whether there was an understanding of how many people had been impacted by spray foam insulation, I was told that there was not a number. How can it be that we are counting how much of one sort of insulation has been installed, but not another? Some 250,000 people have been affected by spray foam insulation. Will she give justice to them, too?
Miatta Fahnbulleh
I thank the hon. Member for all the work he has done on spray foam insulation and the campaigning he has done for his constituents. I fondly remember that Adjournment debate with just the two of us, and I vividly remember the stories he told of Tom and Norma. I reiterate the commitment to work together to try to resolve this.
The difference between spray foam insulation and work done under the ECO and GBIS schemes is that, because those are Government-backed schemes, we have the data. Large numbers of people have had spray foam installed, and some but not all of that work was done through the green homes grant.
We recognise that there is a problem with the system of quality assurance and regulation across the piece—we have acknowledged that very clearly in the House. We will continue to work with MHCLG and other colleagues to think about what we can do on spray foam. The priority, as the hon. Member will understand, is households who have had work done under ECO and GBIS that, if we do not fix it quickly, could result in damp and mould. We must act quickly on that. However, I acknowledge that there is an issue with households that had spray foam insulation done under the old system. As I said when we had the debate, we will continue work to think about ways in which we can resolve that for those households.
Phil Brickell (Bolton West) (Lab)
I welcome the Minister’s statement and, in particular, her remarks on consumer protection. Following on from the hon. Member for Harrogate and Knaresborough (Tom Gordon), a constituent recently told me at my surgery about work carried out on their home under the last Government’s green homes grant. Following spray foam insulation being put into their loft, they have a leaking roof that cannot be accessed, as well as damp that was not there previously. Those issues have had a huge detrimental impact on their lives. They find themselves unable to afford remedial works amounting to thousands of pounds. What message can the Minister share with my constituents? Will she meet me to discuss spray foam insulation installed under the green homes grant scheme?
Miatta Fahnbulleh
I will absolutely meet my hon. Friend to discuss spray foam insulation. Given the correspondence and parliamentary questions I have received on this issue, I offer to meet with hon. Members more broadly, because we need to ensure that we are listening to constituents. If the work was done under the green homes grant, we need to think about how we can get the system to respond as it should. I give that commitment to him and other hon. Members across the House who have cases in their constituencies and are worried about this.
Vikki Slade (Mid Dorset and North Poole) (LD)
I apologise to the Minister, because like the hon. Members for Shrewsbury (Julia Buckley) and for Bolton West (Phil Brickell), and my hon. Friend the Member for Harrogate and Knaresborough (Tom Gordon), I will raise the issue of spray foam. My constituent Matt was told that his house was unmortgageable with the nation’s largest building society, despite his paying extra for an extensive survey of his timbers to prove that there was no problem. He has since been forced to replace his roof at a cost of £21,000 just to get a chance to remortgage and perhaps one day sell his house. The roofing companies told him that the market is booming for spray foam removal by the very same people who put it in, which feels like exploitation. How will the Government address that, and why are Government sites still promoting and recommending spray foam insulation?
Miatta Fahnbulleh
It is important to stress that the Government never recommend a particular solution. The approach that the last Government took and that we have adopted is that, in the end, people have to find the right measure for their home. We never promote any particular measure.
I acknowledge that there is a problem with spray foam, and that installers in the market are putting spray foam in properties where it is not fit for purpose. We have been doing a lot of work with colleagues at the Ministry of Housing, Communities and Local Government to respond to that point about lenders. If there are specific cases where a lender finds something problematic despite a survey saying that it was absolutely fine, please feed that through to us, as we are continuing to work with the industry on that. There should not be a blanket ban.
It is important to stress that where spray foam insulation is carried out well and is appropriate for a property, it is a good thing, but I agree that there are too many cases where it has not been carried out well and is not appropriate. I therefore extend an offer to meet. We need to think about what we will do in response. We have inherited this system, and I wish I could change the past, but I cannot. What we can do is draw a line under it. We can absolutely ensure that we reform the system so that this never happens again, and so that we can command the trust of consumers.
Harpreet Uppal (Huddersfield) (Lab)
My constituents have unfortunately faced a double whammy of not only having had defective cavity wall insulation installed, but being pursued by law firms such as SSB for adverse legal costs. Consumers were badly let down, and we need to ensure that does not happen again. Will the Minister assure us that this will not happen again under future programmes, such as the new warm homes plan? On pipelines, are the Government working cross-departmentally to ensure that we have the right skills and training for future programmes? We want to ensure confidence in the system.
Miatta Fahnbulleh
Let me reassure my hon. Friend that we are absolutely working to ensure that the lessons learned from the schemes we inherited are applied to the warm homes plan as we develop it, and that we put in place systems for checks, assurance and advice, so that consumers can have confidence. We are working across Government, because building up the supply chain and making sure that we have installers with the skills to do the work well is an absolute priority. We are working to deliver that.
Jim Shannon (Strangford) (DUP)
I thank the Minister for a comprehensive response and, as importantly, for giving hope to all those people affected. That assures people and gives them confidence through their elected representatives in this House. In Northern Ireland, we have the affordable warmth scheme, which is different, but the goals are the same. Shortcomings have been identified; will the Minister be so helpful as to share the lessons learned with the Northern Ireland Assembly and the relevant Northern Ireland Minister? That is vital. If something goes wrong here, the lessons learned could help us to solve problems in Northern Ireland.
Miatta Fahnbulleh
We will engage with colleagues in Northern Ireland. We are working closely with all the devolved Administrations. We are building up the evidence base on what happened and thinking about our response, and we are keen to share with other authorities any insights that we gain.
Draft Heat Networks (Market Framework) (Great Britain) Regulations 2025
Miatta Fahnbulleh Excerpts(2 months ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I beg to move,
That the Committee has considered the draft Heat Networks (Market Framework) (Great Britain) Regulations 2025.
The draft regulations were laid before the House on 28 November 2024. As heat networks have not yet been debated in this Parliament, I want to say a few words about the context for the draft regulations. Some 23% of the United Kingdom’s carbon emissions come from heating buildings, so decarbonising heat is key to reaching our net zero commitments and to reducing our reliance on international fossil fuels as we sprint to clean power by 2030. Heat pumps and heat networks are the two principal technologies that we believe will achieve that.
We believe that heat networks will be key to reducing bills for the next generation. Their energy can be drawn from large, efficient heat pumps or even from heat that would otherwise be dumped into the air, such as from data centres and waste incinerators. Heat networks, which have been proven internationally to provide affordable low-carbon heat, are especially suited to dense urban areas. The Government therefore expect that about 20% of the UK’s heat demand will be met by heat networks by 2050, up from 3% today. I have visited Mersey Heat in Liverpool and seen at first hand the huge potential of heat networks, not just to benefit consumers but, critically, to regenerate our urban centres.
Alongside growing the market for heat networks, we need to ensure that the 470,000 households supplied by heat networks today, as well as the many households that will be connected in future, can receive a fair deal as the market grows. One of the biggest barriers is that heat networks are inconsistently regulated. As people on heat networks cannot change their supplier, heat networks are effectively a monopoly with a captive market, which makes it harder to ensure that consumers are treated fairly. Through lots of conversations with consumer groups and through Government-commissioned research, we can identify gaps where the current market is not providing consumers with a fair service, heating is less reliable, suppliers are less transparent and it is harder for consumers to represent themselves or make complaints.
The current situation is clearly intolerable. These are not just consumers, but people trying to keep themselves healthy and warm and trying to live their life. I spoke to the Association for Decentralised Energy in October about the need to ensure that these people are at the very heart of the energy market transition that we need to make and at the very heart of how we think about heat networks.
The Energy Act 2023 provides powers for the Secretary of State to introduce regulations across Great Britain that will protect heat network consumers comparably to consumers of other regulated utilities. The draft regulations are the first step in introducing this regulatory framework. They will introduce an authorisation regime to be implemented by Ofgem, which will work in a similar way to the gas and electricity licensing regimes that Ofgem already regulates. They take an outcomes-based approach to reflect heat networks’ diversity of scale and their nascent market position.
The draft regulations will ban running a heat network without an authorisation. To phase in market regulation, existing heat networks will automatically be given an authorisation. The conditions for authorisation are set by either the Secretary of State or Ofgem and apply rules for running a heat network. Ofgem will be able to monitor compliance with the regulations and act where appropriate. Actions that Ofgem can take include issuing information notices for compliance data, investigating suspected non- compliance, inspecting commercial premises and issuing a range of orders to require remedial action. Consumer redress orders can also be issued to require that affected consumers be given compensation.
The draft regulations will require Ofgem to publish statements of policy on how powers are used. Penalties will be proportionate to the authorised person’s size and the scale of harm that their non-compliance has caused. Additionally, the draft regulations will give Ofgem powers to set standards of performance for heat networks, determining minimum performance levels of service provision to consumers.
Graham Stuart (Beverley and Holderness) (Con)
Like the Minister, I have visited heat networks around the country and I think they have a significant part to play. She has told us what she expects the heat network contribution to be in 2050, but can she tell us what she expects it to be in 2030? What steps are being taken now, other than changing the regulatory environment, to encourage the take-up of more heat networks around the country?
Miatta Fahnbulleh
We are running at the roll-out of heat networks. We want to get to 20%—for me, that is the minimum level to reach by 2050—and we want to make huge progress in this Parliament. That means getting the investment framework right, so we are talking to industry and are thinking about what investment looks like so that we can scale it up in the UK. We are trying to create a regime in which local authorities can work in a co-ordinated way to incentivise the roll-out of heat networks in their patch. Critically, we are putting in a regulatory framework, because in the end we need consumers, whether they are commercial or domestic, to have faith and confidence that heat networks will deliver for them. The draft regulations are critical to showing people that a heat network is not just good for heating their home, but good for their pockets.
Graham Stuart
I appreciate the Minister’s enthusiasm. Can she put any kind of number on her expectation for this year and for the coming years until 2030? The year 2050 is a long way off, so I would like to know the trajectory and the Government’s priority now.
Miatta Fahnbulleh
I would love to give the right hon. Gentleman a number, but as it is not fully in our gift, because we are working with industry partners to get to the scale we want to achieve, I will refrain from doing so at the moment. But will he please be absolutely reassured that we are trying to run at pace? I see the huge potential of heat networks. They are a way in which we can not only decarbonise our urban centres, but fundamentally lower bills for large numbers of consumers. We are doing everything we can to reassure industry, put incentives in place and ensure that we have a regulatory framework that absolutely works for industries and for consumers so that we can get to 20% sooner rather than later.
Let me say a little about how the draft regulations will apply parts 1 and 2 of the Consumers, Estate Agents and Redress Act 2007 with some modifications to apply them to heat networks. They will create the roles of consumer advocacy bodies for heat network consumers, which will be key to providing access to advice. They will also extend the Energy Ombudsman’s redress scheme to heat network consumers. The draft regulations will automatically enrol all heat networks into the scheme.
Hon. Members may have noted that the commencement dates for some of the provisions are slightly different. That is because delays to the passage of the Energy Act mean that Ofgem cannot commence regulatory activities before January 2026. To ensure that heat network consumers are afforded some support before then, because we know that that is critical, we are establishing the roles of consumer advocacy, advice and redress scheme providers earlier: in April 2025.
Finally, the draft regulations will make amendments to the Heat Networks (Scotland) Act 2021 to ensure that Ofgem can regulate consistently across Great Britain. My Department has consulted extensively with counterparts in the Scottish Government to reach agreement on those amendments.
The content of the draft regulations is based on two consultations: a 2020 consultation on creating a market framework and a 2023 consultation on consumer protection. Across both consultations, broad support was expressed for the structures that are being created in the draft regulations. The content of the authorisation conditions is still being consulted on; the outcomes will be published before the authorisation regime commences.
The draft regulations are the first step to introducing comprehensive regulation to the heat networks market. I am absolutely committed to ensuring robust consumer protections across the energy sector, because we have to maintain the confidence and the trust of consumers. Heat networks have huge potential to transform clean power, as I am sure everyone in this room agrees. Delivering cheap and efficient heat across the country is an absolute priority. The draft regulations will pave the way for a fairer industry that does not grow at the cost of consumers.
Miatta Fahnbulleh
I thank hon. Members for their valuable contributions to the debate. It is great to see cross-party consensus on these important regulations.
The heart of our approach has been putting consumers front and centre in our energy transition. I reassure the Committee that that is not unique to heat networks; it is the approach that we are taking in every realm of the heat transition and the energy transition as we sprint to clean power by 2030. The draft regulations will begin the process of ensuring that existing and future heat network consumers both get a fair deal. I know of cases in my constituency, and in the constituencies of hon. Members I have spoken to across the House, where that is not happening, so we need to move at pace to ensure that it does.
I am excited about the potential of heat networks and what they can achieve, both for people’s pockets and, critically, for regenerating our urban areas. I hope that the consensus that we have achieved in this Committee Room today will continue in future debates as we move on to other areas of the energy transition.
Question put and agreed to.
Energy Company Obligation 4 and Great British Insulation Scheme
Miatta Fahnbulleh Excerpts(2 months ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
This statement will be made at a later date.
[HCWS373]
Draft Clean Heat Market Mechanism Regulations 2024
Miatta Fahnbulleh Excerpts(2 months, 1 week ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)
I beg to move,
That the Committee has considered the draft Clean Heat Market Mechanism Regulations 2024.
The regulations were laid before the House on 21 November 2024. It is this Government’s mission to deliver warmer homes that are cheaper to run. Low-carbon heating is key to our efforts to lower emissions. It is also central to how we alleviate fuel poverty. Our goal is to make energy fair and affordable for all by strengthening the nation’s energy security and by reducing our reliance on fossil fuels and international markets that we cannot control. That is at the heart of everything that we are trying to do as a Department.
We have experienced a particularly cold start to 2025 and we can no longer afford to leave consumers facing high energy bills and cold, draughty homes. That is why we are charting a way forward through our warm home plan: a new approach that will result in millions of homes being upgraded and lower energy bills for families across the country. At the same time, it will back British businesses and create new opportunities for jobs and skills in every part of the country.
We are running at this. We have already set in motion the development of new standards for minimum energy efficiency in the private and social rented sectors that will lift 1 million people out of fuel poverty. We have announced changes to planning restrictions—including the removal of the outdated 1 metre rule—that will make it easier for people to install heat pumps. We are expanding our boiler upgrade scheme, almost doubling the budget to £295 million for next year, so that more people can have access to support for installing heat pumps, and we are working with the Ministry of Housing, Communities and Local Government to make sure that we are building future-proof new homes.
Making the transition to cleaner, cheaper heating is one of the most important challenges that we face as a country. We are absolutely determined to make that transition in a way that is ambitious, achievable and, critically, absolutely affordable for consumers. Every household deserves the security of a home that they can afford to heat and we believe heat pumps have a key role to play in that. Heat pumps are, on average, three times more efficient than gas boilers and are powered by electricity that becomes cleaner every year as the share of renewables on the grid grows. Heat pumps can therefore slash the level of energy we use for heating and reduce our reliance on gas. That reliance cannot be overstated: nearly half of the UK’s total natural gas consumption every year is currently used for heating buildings, producing roughly a quarter of total greenhouse gas emissions.
The proposed changes to our energy system will not happen overnight but it is important that we communicate that this is part of a long-term plan, and that we will keep this as a key priority. Nowhere is that more important than the critical work we must do with business as we make this transition. It is essential that the businesses that we work with, throughout the supply chain, know that they can put in the steps they need to build skills, and that they will have incentives and support to deliver this transition, and to do the critical job of helping households benefit from the switch to the cleaner, more efficient heating that we believe heat pumps can provide.
That is why, in addition to direct support for heat pump installations through schemes like the boiler upgrade scheme, the warm homes social fund and the warm homes local grant, we are providing investment in home-grown heat pump production through the heat pump investment accelerator competition. It is also why we are supporting installers through the heat training grant and why we are stimulating further investment in the supply chain by introducing the clean heat market mechanism with this instrument.
Since taking office, we have taken steps to engage with and listen to all parts of industry about the overall approach that we need to take on this policy. We are committed to continuing those conversations in the months and years ahead, including in relation to the clean heat market mechanism. We are proposing a reformed scheme that will provide the UK’s heating industry with the stability, clarity and policy direction to build a strong and resilient heat pump market that will benefit from the transition as we sprint towards low-carbon heating. The changes that we have made to the previous Government’s proposal for the mechanism will ensure that manufacturers have the time they need to scale up the supply chain and expand sales without penalising consumers. We will also need manufacturers to have the incentives and clarity to drive the innovation we need in the market, so that we can ensure we are delivering heat pumps that are cheaper and that respond to changes in the market.
The scheme will require boiler manufacturers to achieve the sale and installation of a proportion of heat pumps relative to their gas and oil boiler sales or the equivalent credits from other heat pump manufacturers. For the first year of the scheme, starting on 1 April this year, this is set at 6% of relevant boiler sales. As set out in the consultation response published in November, we have also decided to reduce the payment in lieu for any missing heat pump credits to £500 for the first year from the £3,000 previously proposed. We have also aligned the periods over which boiler sales and heat pump installations will generate obligations and credits, respectively, providing manufacturers with more time to prepare.
We are confident that between 2025 and 2026, the market can achieve the volume of heat pump deployment that the scheme is targeting, building on the substantial growth in sales seen in 2024. We are committed to working with industry to do the vital work of boosting demand for heat pumps and ensuring that it is as easy and painless as possible for consumers to go on this journey with us.
We are committed to ensuring that the transition to clean, affordable heating works for homes and businesses. That means having consumers firmly in our mind’s eye as we develop policy in this area and ensuring that we are working in lockstep with industry. That will be at the heart of our approach in the warm home plan. The statutory instrument is just one part of our overall strategy for delivering homes that are warm and cheaper to run, but it is an important part of how we deliver warmer homes with lower energy bills. It signals our ambition to tackle fuel poverty, which is still experienced by far too many people in this country, as we make that vital sprint, as we must, to clean power by 2030.
Miatta Fahnbulleh
When the Conservative party was in government, it was willing to see sky-high energy bills. The reality in this country today is that, quite frankly, many people cannot afford the cost of energy. That is the reality that the Conservatives were happy to deal with, but it is not a reality that we believe is either tenable or acceptable, and it is one that we are determined to change. That is why we are making the sprint to clean power and are determined to deliver a warm home plan that can deliver cheaper and warmer homes for consumers across the country.
I will address some points that are quite frankly wrong. First, there will be no compulsion to impose heat pumps. Our job as a Government is to work with industry to make them as attractive a proposition for consumers as we can. We will not force people to adopt them, but we believe that heat pumps are three times more efficient than gas boilers and will be an attractive proposition for consumers. We saw demand for our boiler upgrade scheme reach record levels in 2024, because consumers are starting to realise what we know from the evidence base: that this proposition absolutely works for their pocket and for their homes. Our job is to ensure that not just wealthy households but every single household across the country can benefit from it.
To debunk the second point made by the hon. Member for West Aberdeenshire and Kincardine, this is absolutely not a tax. There is no requirement for industry to impose costs on consumers. We have worked very hard with industry to reform the proposal put forward by the Conservative party, which industry absolutely hated, to get to a proposition that we believe will do the job of incentivising the market for heat pumps, as everyone recognises we need to do, while protecting consumers.
Finally, we have to get to the right solution for every household in the end. We are not ideological about this. We care about getting consumers warmer homes and lower energy bills, and we will find a range of solutions that mean that where heat pumps work—we think that they will work in the majority of households, including in rural households—we will make it as easy as possible for consumers to adopt them. Where there is a need for alternative technologies, we are keeping those technologies under review so we can ensure the right solution for every single household.
The status quo is not tenable, nor should the Conservative party be proud of it. Quite frankly, it is a status quo that we are absolutely disgusted to have inherited. Our job is to take the country on the journey that we need, which is why we will not resile from driving forward with our clean power mission. In the end, we have to take ourselves off the rollercoaster of international fossil fuel markets over which we have no control. That is why we will drive forward our warm home plan. Heat pumps and the clean heat market mechanism will be a key part of that. I commend the draft regulations to the Committee.
Miatta Fahnbulleh
I thank my hon. Friend the Member for Worcester. We absolutely will approach it in that way. We know that we cannot do this on our own, and that we must work in collaboration with industry—that is what has got us to this point.
My hon. Friend is completely right to point out the flip-flopping from the Conservatives. Let me quote what the hon. Member for West Aberdeenshire and Kincardine said about the clean heat market mechanism when he was in government:
“The Government back the dynamism of industry to meet the needs of British consumers, which is why we are taking a market-based approach that puts industry at the heart of leading a transformation of the UK heating market, while keeping consumers in the driving seat with choice. Through the planned low-carbon heat scheme—the clean heat market mechanism—we will provide the UK’s world-leading heating appliance industry with a policy framework that provides the confidence and incentive to invest in low-carbon appliances. That will make heat pumps a more attractive and simpler choice for growing numbers of British households.”––[Official Report, Energy Public Bill Committee, 6 June 2023; c. 145.]
That was when the hon. Member was enlightened.
Miatta Fahnbulleh
What happened to that guy, indeed. It is a shame to see the Conservative party flip-flopping rather than doing what it knows is right for the country and right for consumers.
Question put.