Energy Price Freeze

Robert Syms Excerpts

Wednesday 2nd April 2014 Commons Chamber

[Mr Robert Syms (Poole) (Con)]

I was going to give a comprehensive solution to the energy problems but, given that the time limit has gone down from six to five minutes, I hope the House will forgive me if I do not say anything about how we can sort out those problems.

This is, of course, an important debate, because the issue impacts on so many people: energy bills are among the largest things they have to pay. I would point out, however, that since the industry was privatised, energy bills have generally been lower than in most other countries in Europe. However, privatisation did not work well in that it inherited quite a lot of capacity to generate and we did not get the sort of investment we should have. That should have been addressed by former Governments.

If I have a worry, it is more about supply than price. The reason fuel poverty is mentioned is that people cannot afford to have their heating on, but if it is not possible to generate heat such that people will not be able to have it on anyway, that will have the same impact on many of the most vulnerable people, such as the elderly, because they will not be able to heat their homes. We really have to sort out the question of supply.

I am a little frustrated because the Budget mentioned reducing tax to incentivise companies to invest and increase productivity, but now we are having a debate about energy policy and what seems to be a stalled investment programme. In his sensible speech, my hon. Friend the Member for Warrington South (David Mowat) mentioned some of the plants we are closing but, although there are planning permissions on the books, people are not investing. That means that we have a real problem, because capacity is reducing and, as we all know, there is likely to be 4% surplus capacity in 2015. That is very close to having black-outs. Some say that high-energy producers could send their workers home and we could turn off the energy to those plants, but the reality is that if we want the British economy to grow and if we want jobs and exports, it would be bonkers not to invest in energy supply, because otherwise we will not be able to generate the energy we need to generate the economic wealth we want as a nation.

We need to provide more incentives for people to invest. There seem to be a lot of things preventing them from investing. Perhaps there is a strong argument for referring the issue to Ofgem to conduct a big review of the market, but it will slow down investment. I am worried about that, because there is going to be a gap for the next three or four years, and that means that there is a very real risk that the lights will go out. If Members think that the politics of high prices are difficult, they should be aware that the politics of cuts in energy are severe for any Government who do not keep the lights on. That is my main concern. I want Government Front Benchers to keep an eye on the issue and push investment. We need it, because even if nuclear power, which I welcome, follows on from the European Commission review, it will be some years before that 7% of valuable additional generating capacity will become available.

Of course, we are trying to stretch the life of existing Magnox nuclear stations and the last debate we had on energy was about trying to keep some of the coal-fired stations open. I think it is silly to allow stations to close when there is no guarantee that we can generate the electricity through new investment. That is my principal message.

There are other subsidiary issues. Transmitting power is very important. All the transmission engineers say that we are painfully short of people to provide transmission cables, and we will need many such cables if we invest in new nuclear power. There is a lot more to be done. I am sorry I have made only a brief contribution, but I emphasise that the supply of energy is very important and could very quickly, if we get this wrong, rise to the top of the political agenda.