The Government has failed on fuel poverty

There were questions on Energy and Climate Change yesterday.

Henley MP John Howell (right) asked about fuel poverty:

"Given that the term “fuel poverty” does not seem to have been used once in yesterday’s Budget statement, can the Secretary of State confirm that Warm Front will be sufficient to address Age Concern’s assessment of the Budget that its failure to tackle fuel poverty will continue to leave more pensioners out in the cold?

Edward Miliband: I disagree with the hon. Gentleman—and, of course, the Conservative party cannot support any of the measures that we took on public spending, because as we know it is completely opposed to increasing public spending at this time. The measures that we took on housing, including specifically £100 million for energy efficiency in the social housing sector, will help precisely some of the most vulnerable people in our country. My hon. Friend the Under-Secretary of State for Energy and Climate Change will announce in a written statement this morning an increase in the maximum Warm Front standard grant from £2,700 to £3,500. I think that will be widely welcomed, alongside other improvements in Warm Front, because it is helping some of the most vulnerable people in our society. I am very proud of the record of what we are doing to help some of the most vulnerable people in our country who are facing fuel poverty."

It is, of course, a lie to say that you can't freeze or even cut a department's overall expenditure whilst concurrently increasing spending on certain individual projects.

Shadow Secretary of State Greg Clark went on the same issue:

"The Secretary of State knows that the coverage of the Warm Front scheme is limited, but does he accept that for most homes investing in energy efficiency saves money on fuel bills?

Edward Miliband: I do, which is why we unveiled plans in February for “pay as you save” insulation, whereby people will be able to spread the costs of energy efficiency measures over a number of years; it will not be linked to the person in the house but to the house itself, so that the costs can be spread over 20 years or so. Therefore, part of the savings from the energy bills will be able to be used to fund to kind of insulation that we need. We have very ambitious plans for 7 million houses to have whole-house refurbishment by 2020 and all houses to have it by 2030. Unlike the Conservative party’s plans, those are costed plans; they have been worked through and they will work.

Greg Clark: Yesterday, Greenpeace described the Secretary of State’s plans as strikingly lacking in ambition. If he accepts that savings can be made through investment in insulation, why, when households will face higher tax bills for years to come, is he resistant to our policy, which would give every home in the country an entitlement to £6,500-worth of immediate energy efficiency improvements, paid for from the savings that people make on their fuel bills? Why is he resisting that?

Edward Miliband: I will explain this to the hon. Gentleman. My hon. Friend the Under-Secretary of State for Energy and Climate Change wrote him a letter—he may have replied, but I am not aware of his reply. His proposal is that £6,500 will be available to every household in the country. That would cost £170 billion up front. As far as I can see, he has no idea where that £170 billion will come from and how he will raise it. I hope that he comes forward with that. I look forward to his having interesting discussions with the shadow Chancellor about how £170 billion of funding will be provided. I think it is the largest uncosted commitment made by the Conservative party, but of course it is not the only uncosted commitment that the Conservatives have made, and it shows that they simply cannot be trusted with the nation’s finances."

Shadow Environment Minister Greg Barker asked about carbon capture and storage:

"The news that the Government have effectively abandoned their previously slow, embarrassingly unambitious and unfunded CCS competition and moved towards the vision for CCS that was articulated by my right hon. Friend the Member for Witney (Mr. Cameron) last year is welcome, but there is still huge scepticism that this is just another Labour smokescreen of spin and rhetoric. We are to have a statement shortly on CCS, but can the Minister answer one fundamental question? Can he guarantee that not a single new coal-fired power station will be built without CCS being up and running from day one? Or is this just another Labour “Sometime never; well into the future; not on my watch” strategy to get the Government through a difficult political period?

Mr. O'Brien: We can see that the Conservative party’s attitude towards the coal industry during the 1980s and early ’90s, when the Conservative Government closed the pits, remains in place. The vehemence with which the hon. Gentleman put his points demonstrates how miners in this country have faced the Conservative party’s opposition to their even being employed.

We will be making a statement within the hour—or very shortly; it depends on the first statement, sp perhaps in two hours—in which we will set out in detail how we will be taking CCS forward. The hon. Gentleman’s claim that the Leader of the Opposition has been in some way an advocate for the coal industry is laughable. Ensuring that we have a low-carbon economy, with coal as a part of that, and that we generate electricity from coal using CCS, is a key component of our policy."

Shadow Transport Minister Robert Goodwill expressed qualified approval for the Government's policy of including nuclear power in the energy mix: 

"As vice-chairman of the all-party nuclear energy group, I certainly join in welcoming the decision, which is not before time. However, it often takes as long to get planning permission for a new nuclear power station as it takes to build it. Can the Secretary of State reassure me that the Government’s Planning Act 2008 will do what it says on the tin and get planning permission through rapidly and effectively?

Edward Miliband: I can give the hon. Gentleman that reassurance. It is only regrettable that the Opposition did not think it appropriate to support the Planning Act and its Infrastructure Planning Commission, which is designed precisely to do what he says should be on the tin—to speed up the development of new nuclear. Just to make it clear to the House, the process will involve the publication of a national policy statement in the autumn with the strategic sites attached to it. There will then be a period of consultation—including, I think, with a Select Committee. The plan is then to designate by the spring. So, all being well, we have tackled the big issue around planning and I hope that we have done so in a fair way that gives people a chance to air their views. I am pleased to hear the hon. Gentleman’s support for our plans on planning."

Shadow Minister for Energy Charles Hendry chipped in:

"We agree with the Secretary of State about the role for unsubsidised nuclear alongside renewables and gas and coal with carbon capture in a balanced energy mix, but does he recognise that the energy crunch will be with us by 2016 at the latest, as one third of our existing coal capacity is due to come offline before then, and that because of the Government’s failure to secure investment earlier, most of the new capacity, including all new nuclear, cannot come on-stream until well after that date? Does he understand why so many people believe that the Government’s failure to lead in carbon capture technology, their failure to secure adequate levels of gas storage and their over-reliance on onshore wind at the expense of other forms of renewables all mean that our energy security has been fundamentally compromised—and that without energy security, affordable and clean energy become much harder to achieve as well?

Edward Miliband: I have great respect for the hon. Gentleman, but it takes a real brass neck to say to us that we should have gone faster with new nuclear, when the Leader of the Opposition was opposing us on new nuclear and saying that it was a last resort; he was dragged, kicking and screaming, to support us on new nuclear. New nuclear will make an important contribution to our energy mix in 2017 and 2018. Carbon capture and storage can play an important role as well, as can renewables. We have plans in place to move towards low-carbon energy supply, and I am confident that we will meet them."

Wellingborough MP Peter Bone was worried about onshore wind farms:

"What recent assessment he has made of the cost-effectiveness of (a) onshore and (b) offshore wind farms in electricity generation. [270301]

The Minister of State, Department of Energy and Climate Change (Mr. Mike O'Brien): Our onshore and offshore wind farms are cost-effective, large-scale renewable energy generators and they are supported through the renewables obligation. The Chancellor announced yesterday that we are looking to increase the renewables obligation certificate support for offshore wind.

Mr. Bone: I am grateful to the Minister, particularly for the last part of his response. There is a great deal of concern in my constituency about an onshore wind farm. Although offshore wind farms are to be welcomed, would the Government consider the possibility of a presumption that onshore wind farms should not be developed unless the local community wants them?

Mr. O'Brien: I cannot comment on Nun Wood farm in the hon. Gentleman’s constituency; obviously, that is part of the planning process. If we are serious about dealing with the creation of a low-carbon economy, we must have both onshore and offshore wind generation; we cannot do it with offshore alone. Therefore, onshore wind is a key component of making the changes that we need to make in the generation of energy to create a low-carbon economy. Obviously, each planning application will have to be considered on its merits in the appropriate way. We want to ensure the focus to get the investment so that wind provides the renewables generation that this country needs."

Sir Nicholas Winterton made the point that turbines have to be imported:

"I fully support the views expressed by my hon. Friend the Member for Wellingborough (Mr. Bone); there is huge opposition to onshore wind farms. What is the subsidy for every wind turbine erected in this country? Is it not true that there is a shortage of such turbines and that we have to import them, which is certainly not helpful to the country’s manufacturing base?

Mr. O'Brien: The hon. Gentleman is right: we do have to import most of our wind turbines. Although until recently wind turbines were made in the United Kingdom, they were exported to the United States. We are talking to a number of manufacturers with the intention of returning those jobs to the United Kingdom in due course, because that is important to us in the long term.

I should point out to the hon. Gentleman that while the Leader of the Opposition says that he is in favour of creating a low-carbon economy, Conservative Members of Parliament are going around the country constantly running down the whole issue of the need to ensure that we have a level of onshore wind generation. We cannot build that low-carbon economy without onshore wind.

Appropriate levels of support are provided, although the precise level of subsidy varies according to the value of the renewables obligation certificates."

Kettering MP Philip Hollobone was concerned about the efficacy of turbines:

"Surely it makes sense to put wind farms onshore in the windiest places, but according to the London Metropolitan business school, in 2007 the mean load factor of the 81 wind farms in England was just 23 per cent. In other words, they were working for less than a quarter of the time. How can that be an efficient use of resources?

Mr. O'Brien: The normal working level is about a third of the time. Intermittency has always been an issue in the build-up of the renewables economy, and, as the hon. Gentleman says, it must be addressed. We can reduce the intermittency problem by ensuring that, once it is switched on, nuclear generation has a reliable base load, and also by building renewables, including wind. We need to deal with both intermittency and the variability of demand and supply. In the case of gas and coal, that can be done through carbon capture and storage.

Broadly speaking, we need to create the right level of generation, but it is also important for us to deal with intermittency. The decision to locate wind farms in areas where they will generate must be made by the companies that fund them."

Ludlow MP Philip Dunne asked about biomass:

"At a public inquiry last week on a potential biomass plant at Bishop’s Castle in my constituency, one of the objectors suggested that the Environment Agency is now indicating that the carbon emissions from electricity generated by biomass plants are greater than those generated by fossil fuel plants. Is that the Government’s view?

The Minister of State, Department of Energy and Climate Change (Mr. Mike O’Brien): I have not heard that particular suggestion before, but I shall certainly consult the Environment Agency to see whether it has said that and, if so, what the basis for making such a claim is."

Shadow Work and Pensions Minister Andrew Selous asked about the cost of petrol:

"In October last year, when oil was around $70 a barrel, a litre of unleaded petrol cost the motorist about £1.07, yet in June 2007, when oil was around $71 dollars a barrel, a litre of unleaded cost 97p. Does that not indicate a degree of market failure among some of the major petrol retailers? Why have the Government not instructed the Competition Commission to instigate an inquiry to make sure that the beleaguered motorist is treated fairly, not least because the motorist was clobbered again in the Budget yesterday? Does the Minister not realise that many people have no choice but to use their car?

Mr. Mike O’Brien: It is the case, of course, that the escalator was introduced by a Conservative Government. But let us not go there; let us instead deal with the real issue of the price of fuel for cars. The price of petrol and diesel spiked last year; that was a substantial burden for the motorist, but the price has gone down sharply. It is dependent, obviously, on the overall world economic situation. The demand for oil responds very quickly to global financial circumstances and, as a result, prices have fallen, but it is interesting that they have started to rise again, albeit not to a substantial extent. On the price of oil there is not only a need to ensure that we are able to get out of the recession without it spiking too high; we also need to sustain investment in the oil and gas industry, particularly—from the UK’s point of view—in the North sea."

Congleton MP Ann Winterton rounded off matters with a sceptical broadside on climate change:

"Can we not have a more balanced discussion on climate change? We are told so often that the north pole is melting, yet Arctic ice has reached a maximum area this winter, and the British Antarctic Survey has confirmed that over the past 30 years, the area of sea ice around the continent has expanded. In fact, the south pole has experienced significant cooling in the past 30 years. Why do we not hear the facts, so that we can make up our mind about what is happening?

Edward Miliband: I am all for unconventional thinking, but I say to the hon. Lady that on these sorts of questions, it is best to trust the science. [Interruption.] If she will let me finish my answer, I can point out that the overwhelming scientific consensus is that climate change is real, is happening, and is man-made. I really worry about an approach that says, “We can leave all this to one side, because perhaps it is not happening”, as that is not what the scientists are telling us. To take one year, or one fact, and say that somehow it shows that climate change is not happening is precisely what the scientists tell us that we must not do. We must look at the trend over 20 or 30 years, and that shows unequivocally that climate change is happening."

Tom Greeves