Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if he will make an assessment of the potential merits of reducing the energy price cap for winter 2024-25.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The energy price cap is set by Ofgem and not the Department for Energy Security and Net Zero. More information on how Ofgem calculate the price cap can be found on its website - https://www.ofgem.gov.uk/energy-price-cap.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what steps he plans to take to help ensure that people (a) who use a prepayment meter and (b) in fuel poverty are able to heat their homes in Winter 2024-2025.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The Government is committed to supporting households with the cost of energy this winter, and we are continuing to deliver the Warm Home Discount which provides a £150 rebate off energy bills for eligible low-income households.

The setting of prices for customers on a prepayment meter or on a fixed contract is a commercial matter for energy suppliers. The Ofgem price cap for the period 1 October 2024 to 31 December was published in August, and the price cap level for prepayment meter customers is £1,669 compared to the level set for direct debit customers which is £1,717 for an average household.

I have also outlined our expectation to energy suppliers that they should do everything they can to support customers who are struggling with their bills, especially vulnerable consumers. Last month I met with energy suppliers and encouraged them to sign up to the Voluntary Debt Commitment for this winter, and I will work closely with them in the weeks ahead to ensure vulnerable consumers are supported through this winter.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if he will make an estimate of the potential impact on consumer energy bills of the total lifetime cost of delivering (a) the Western Link and (b) all current and future stages of the Eastern Green Link offshore cabling.

Answered by Michael Shanks - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

Electricity network reinforcements are only approved where they are in the interests of consumers and help reduce overall system costs. For both the Western Link and the Eastern Green Link projects, decisions to proceed were based on robust cost-benefit analyses, approved by Ofgem. Ofgem review proposed project costs and ensure that network companies spend efficiently, protecting consumers from unduly high costs.

These reinforcements are designed to help balance the GB grid, bringing renewable generation in Scotland to demand centres further south. While they have significant build costs, they will help reduce balancing costs, bringing overall savings to consumers.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what steps he is taking to enable people on a prepayment meter to move onto an energy contract.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

It is a commercial matter for energy suppliers and their customers to determine which payment method customers should use. Any consumer who wishes to change their payment method or amend their contract should speak to their supplier. It is worth noting that some consumers may choose to have a prepayment meter as it can help them to budget their energy more effectively.

Last year, Ofgem introduced stringent rules for the installation of involuntary prepayment meters, to improve protections for vulnerable consumers. The Government will continue to work with Ofgem to ensure that suppliers only install involuntary prepayment meters as a last resort.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if he will take steps to ensure that people on a prepayment meter pay no more for energy than those on a contract.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The setting of prices for customers on a prepayment meter or on a fixed contract is a commercial matter for energy suppliers. The Ofgem price cap for the period 1 October 2024 to 31 December was published in August, and the price cap level for prepayment meter customers is £1,669 compared to the level set for direct debit customers which is £1,717 for an average household.

More information can be found on the Ofgem webpage - https://www.ofgem.gov.uk/energy-policy-and-regulation/policy-and-regulatory-programmes/energy-price-cap-default-tariff-policy/energy-price-cap-default-tariff-levels.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if his Department will make an assessment of the potential merits of reprioritising the grid connection queue to favour viable projects with planning consent over (a) stalled and (b) speculative projects that have booked grid capacity.

Answered by Michael Shanks - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

Government is working at pace with Ofgem, the Electricity System Operator (ESO), and network companies to accelerate electricity network connections. The ESO is developing proposals with stakeholders to raise requirements to obtain and retain a connection agreement. Under these proposals, stalled or speculative projects that cannot demonstrate sufficient progress would be removed from the connection queue and capacity reallocated to viable projects.

The ESO expects to submit its proposals to Ofgem in December 2024, for a decision in spring 2025.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if he will make an assessment of the potential merits of increasing imports of renewable energy.

Answered by Michael Shanks - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

In 2023, imports via interconnectors provided 10.2% of gross UK electricity supply, highlighting the key role that they already play. Imports via interconnectors can provide access to lower-cost electricity for GB consumers, reduce the need to dispatch higher carbon domestic generation during peak times, and enhance our security of supply. We expect interconnectors to continue to be an important component of our future decarbonised electricity system.

Ofgem are responsible for taking regulatory decisions for new interconnector projects. Their draft analysis for projects being assessed as part of the current regulatory window can be found at: https://www.ofgem.gov.uk/energy-policy-and-regulation/policy-and-regulatory-programmes/interconnectors

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, whether the Local Power Plan will contain measures to enable community energy schemes to sell electricity that they generate directly to local customers.

Answered by Michael Shanks - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The Local Power Plan will put local authorities and communities at the heart of the energy transition, giving them a stake in the shift to net zero as owners and partners in clean energy projects, allowing more to come online. Small-scale electricity generation sites can benefit from an exemption, which means they do not require a licence from Ofgem to generate electricity or to supply to local customers. Ofgem has further flexibility to award supply licences to generation sites that are above the exemptions threshold when restricted to specified local area.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if his Department will make an assessment of the potential merits of changing grid connection rules restricting operators from directly supplying households unless they acquire the same supply licence as large scale utility companies.

Answered by Michael Shanks - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

Small-scale electricity generation sites can benefit from an exemption, which means that they do not require a licence from Ofgem to generate electricity or to supply to local customers. Ofgem has further flexibility to grant supply licences to generation sites that are above the exemptions threshold when they are restricted to specified local areas.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what recent assessment he has made of the potential impact of district heating schemes on levels of energy poverty.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

As the sector has never been regulated, the Department has not collected pricing data for consumers on communal or district heat networks. However, we are bringing in regulation to appoint Ofgem as the heat network regulator and giving them powers to monitor the market and intervene on high heat prices. The Department is also exploring options to protect vulnerable consumers in the upcoming heat network consumer protection consultation. As heat networks can efficiently use waste sources of heat, they are well placed to cut bills, as well as to reduce emissions, and our reliance on imported fossil fuels. In urban areas, heat networks are often the lowest cost low carbon heating option for consumers.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, whether his Department plans to reduce the standing charge on household energy bills.

Answered by Miatta Fahnbulleh - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The Government has worked constructively with the regulator on the issue of standing charges, and we are committed to lowering the cost of them. Ofgem’s recently published discussion paper sets out the options for how standing charges could be reduced, including by moving supplier operational costs off standing charges onto the unit rate, increasing the variety of tariffs available for consumer in the market, and in the longer term, reviewing how system costs are allocated. We will continue to support Ofgem in this work and ensure that standing charges are reduced.

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