Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, whether his Department has made an assessment of the effect of proposals to remove appeal rights in the draft Domestic Gas and Electricity (Tariff Cap) Bill on levels of investment in (a) the energy sector and (b) other sectors; and if he will make a statement.
Answered by Claire Perry
The Bill, subject to the will of Parliament, will place a new duty on Ofgem to implement a cap on standard variable and defaults tariffs, so it does not remove an existing right of appeal. Energy companies would be able to challenge Ofgem’s decision on the setting of the cap by way of judicial review.
The Domestic Gas and Electricity (Tariff Cap) Bill is also clear that Ofgem must have regard to the need to ensure that holders of supply licences who operate efficiently are able to finance activities authorised by the licence. It would be for the independent regulator, Ofgem, to make its assessment of efficient operations. Ofgem is not required to have regard to investment projects that are outside the scope of the activities authorised by the supply licence.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy for what reason his the draft Domestic Gas and Electricity (Tariff Cap) Bill proposes a removal of appeal rights to the Competition and Markets Authority, and if he will make a statement.
Answered by Claire Perry
The draft Bill would place a new duty on Ofgem to implement a cap on standard variable and default tariffs, so it does not remove an existing right of appeal.
Energy companies would be able to challenge Ofgem’s decision on the setting of the cap by way of judicial review, and the Government believes that a Court is capable of considering these matters.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the draft Domestic Gas and Electricity (Tariff Cap) Bill, through what route will organisations (a) challenge and (b) appeal the level of a price cap in the event that the right to appeal to an independent body is removed, and if he will make a statement.
Answered by Claire Perry
The draft Bill would place a new duty on Ofgem to implement a cap on standard variable and default tariffs, and provides a bespoke power for Ofgem to implement the price cap through an amendment to the licence conditions. Energy companies would be able to appeal an Ofgem decision on whether to proceed with the licence modification by way of judicial review. It does not remove an existing right of appeal.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, for what reasons his Department's impact assessment for the draft Domestic Gas and Electricity (Tariff Cap) Bill does not include quantitative data on the effect of a price cap on (a) investment in the energy sector and (b) customers, and if he will make a statement.
Answered by Claire Perry
As set out in the Impact Assessment for the draft Bill, the costs and benefits will depend on the detailed methodology the independent regulator Ofgem adopts to set the level of a tariff cap. The Government does not wish to pre-judge Ofgem’s work in establishing the methodology by including quantified analysis of the costs and benefits in the Impact Assessment.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the draft Domestic Gas and Electricity (Tariff Cap) Bill, whether he plans to publish quantitative data on the effect of a price cap on (a) levels of investment in the energy sector and (b) costs to customers before a Bill is presented to Parliament, and if he will make a statement.
Answered by Claire Perry
As set out in the Impact Assessment for the draft Bill, the costs and benefits will depend on the detailed methodology the independent regulator Ofgem adopts to set the level of a tariff cap. The Government does not wish to pre-judge Ofgem’s work in establishing the methodology by including quantified analysis of the costs and benefits in the Impact Assessment.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy what assessment his Department has made of the effect of an energy price cap on the a (a) rise and (b) fall in wholesale energy prices.
Answered by Claire Perry
In designing the method for setting the level of the price cap we would expect that Ofgem would need to consider how to take account of relevant changes in wholesale energy prices, whilst maintaining incentives for switching and enabling effective competition.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, for what reasons the draft Domestic Gas and Electricity (Tariff Cap) Bill proposes he rather than Ofgem or the Competition and Markets Authority makes the final decision on extending or terminating a domestic energy price cap in 2020.
Answered by Claire Perry
The decision on whether to introduce a price cap will be made by Parliament approving a Government Bill on a matter that was a manifesto commitment. It is therefore right for Government to decide whether such a price cap would remain in place, after a report and recommendation from Ofgem.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy for what reasons the draft Domestic Gas and Electricity (Tariff Cap) Bill does not propose a review of the effect of the energy price cap in 2020, (a) every six months and (b) quarterly; and if he will make a statement.
Answered by Claire Perry
The draft Bill proposes to require Ofgem to review and report on whether the conditions for effective competition are in place and to make a recommendation to the Secretary of State. This will inform the Secretary of State’s decision on whether the cap should remain in force. The first review and report would be in 2020 and each year, up to 2023, that the price cap remains in place. The first review in 2020 is to allow key reforms of the market, such as the smart meters programme, to be implemented while ensuring protection for dis-engaged consumers from poor value tariffs.
In designing the methodology for setting the level of the price cap we would expect that Ofgem would need to consider how to take account of relevant changes in costs such as for wholesale energy.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what the time period is for the funding settlement for Growth Hubs which the Government committed itself to in its Industrial Strategy.
Answered by Andrew Griffiths
Through the Industrial Strategy White paper we have announced our intention to ensure all businesses in every region have access to a ‘Growth Hub’. We will build on this programme, providing continued funding to Local Enterprise Partnerships (LEPs) for Growth Hubs to enable them to carry on building their reach, developing peer to peer networks and signposting businesses to the best support available from the private and public sectors.
We will confirm the level and duration of funding to be awarded to LEPs for their Growth Hubs at the earliest possible opportunity.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the Industrial Strategy, published in November 2017, (a) what additional funding will be made available and (b) what the length of the funding settlement will be for Growth Hubs.
Answered by Andrew Griffiths
Through the Industrial Strategy White paper we have announced our intention to ensure all businesses in every region have access to a ‘Growth Hub’. We will build on this programme, providing continued funding to Local Enterprise Partnerships (LEPs) for Growth Hubs to enable them to carry on building their reach, developing peer to peer networks and signposting businesses to the best support available from the private and public sectors.
We will confirm the level and duration of funding to be awarded to LEPs for their Growth Hubs at the earliest possible opportunity.