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Energy and Climate Change

Volume 506: debated on Thursday 25 February 2010

The Secretary of State was asked—

Fuel Poverty

Three and a quarter million of those 4 million households in fuel poverty are designated as being vulnerable households. How are the Government going to meet their 2010 target for eradicating fuel poverty in such households, if that is still possible?

We have to recognise the additional challenge that has been set by rising energy prices over the past few years, but we still intend to work as hard as possible for those vulnerable households, giving help through the obligation on suppliers to insulate homes and through Warm Front, through which we directly fund home insulation. We are also giving help through people’s incomes by means of measures such as the winter fuel and cold weather payments, and through the control of prices, including the present voluntary agreement, which we are seeking to turn into a mandatory social price support scheme through the Energy Bill.

Does my hon. Friend accept that a large element of fuel poverty relates to the energy efficiency of the homes in which fuel-poor people live? Does he also accept that efforts to ensure that those homes are made properly energy efficient are a vital part of our attack on fuel poverty? What is his assessment of the likely impact of community energy response teams, community energy saving programmes, and other schemes, such as the Great British Refurb, on improving the energy efficiency of homes?

I agree that the most sustainable way of helping people to stay out of fuel poverty is to ensure that their homes are energy efficient. That is why we have concentrated so much on the energy companies’ obligation, under which more than 6 million homes have been insulated. Another 2 million have been insulated under Warm Front. The community energy saving programmes scheme is also important in guiding us towards choosing the best policy for sustainable energy programmes, which we intend to reveal shortly in our latest strategy.

As the promoter of the Bill that became the Warm Homes and Energy Conservation Act 2000, I am naturally disappointed that the targets that were set will not be reached this year. The Department is undertaking a review, so will the Minister tell the House when the results will be announced? What instructions will be given to officials to ensure that the strategy is put back on track?

I pay tribute to the hon. Gentleman, who has a long and distinguished record of campaigning on these issues in the House and outside it. He is right to say that we are undertaking a review of our present policies to see whether they can be made more effective, or whether we need new ones. I am giving evidence to the Select Committee in March, and I hope to be able to talk about the emerging findings of the review at that time.

In order to fight fuel poverty, Ofgem is now going to force energy supply companies to print on customers’ bills details of how their tariff compares with the company’s standard direct debit tariff. Why will that information be given out only on an annual statement? That will discriminate against active switchers who might not get such a statement because they have not been with a company for 12 months.

Again, I think that praise is called for. The hon. Gentleman knows that I wrote to him to praise his campaigning on the issue of supplying information to customers, and I am happy to take this opportunity publicly to do so again. The annual reports start this year, so it is perhaps a little early for us to say that it is not a good enough scheme. Every energy bill will contain information about consumption and costs to customers, and I am working with Consumer Focus, the watchdog and champion of all consumers, on improving the quality of such information so that we will be able to give better information to members of the public every day of the year.

Does my hon. Friend agree that there are three components of fuel poverty: dwelling energy efficiency, fuel prices, and household income? Should not Opposition Members recognise that, although things are harder because of fuel prices, a lot more people would be living in fuel poverty if it were not for the increases in child benefit, the working tax credit and the winter fuel allowance?

My right hon. Friend is right about those three issues, and this Government have been determined, even during the worst global recession of my lifetime, to maintain spending on measures such as the winter fuel payment and child tax credits. Such payments have helped vulnerable consumers to pay their bills.

Given that, when we talk about fuel poverty, we are actually talking about poverty itself, what specific measures are being targeted at people who live in council houses?

My hon. Friend is right to say that general poverty is an important issue for the Government to address, which is why we have worked so hard to eradicate pensioner poverty. Now we are even legislating to eradicate child poverty in this country. We pay attention to helping council house tenants, through the payment of their rent and council tax through the benefits that we offer them.

It is nearly 13 years since the beginning of this Labour Government, and is it not a sign of the priority that they have given to dealing with the massive fuel bills that customers regularly receive—we still have no strategy to make every home a warm home—that within three months of the end of this Parliament there is still no coherent Labour policy on the issue?

Now come on. We have arranged, through the energy supply companies’ obligation, for insulation to more than 6 million homes. Through Warm Front, we have directly funded insulation for an additional 2 million homes. We have a policy that every home with a cavity wall or loft that is uninsulated will be insulated by 2015. Having dealt with those so-called easy wins, we recognise that the next issue for us to tackle is hard-to-treat properties, such as those requiring solid wall insulation. Our strategy, which we will unveil shortly, will show how we will address those matters too.

I thank the Minister for his kind words to my hon. Friends the Members for Southend, West (Mr. Amess) and for Billericay (Mr. Baron) for their campaigning on fuel poverty issues. Has he seen the recent report by Ofgem showing that the number of customers falling into debt on their electricity bills has increased by 105 per cent. on the previous year, and by a shocking 147 per cent. in the case of gas customers, and that those figures are getting worse? Does he recall the Secretary of State brushing aside our calls in 2008 for a Competition Commission investigation into energy prices, saying that it would cause two years of uncertainty? Does he accept that such an investigation would have been completed by now, and we could have had real evidence about the level of electricity and gas prices rather than the understandable suspicion and anxiety?

No. The investigation by the Competition Commission of the domestic oil companies took five years from complaint until remedies. In fact, Ofgem conducted a probe, completed its conclusions and issued the new licence conditions, which are now all in force, in less than two years. I completely reject the hon. Gentleman’s suggestion.

My hon. Friend will be aware of the profit results announced by British Gas today. Does he agree that now is the time for energy companies such as British Gas to cut their prices to consumers?

I completely agree with my hon. Friend. We have just come through one of the most severe winters for decades, with customers struggling to pay their high energy bills. Any help that energy companies can give to those customers at this difficult time is welcome. As we can see from energy companies’ profit results, they can afford that help, so others should follow the lead that British Gas gave earlier this month and cut their prices now.

Gas Storage

National Grid’s recent “Ten Year Statement 2009” expects just over 0.5 billion cubic metres of additional gas storage capacity to be commissioned by 2011-12, or an addition of more than 10 per cent. to capacity, including Aldbrough, which will be the second largest facility in the country. In addition, 20 other projects are planned for completion beyond that date, including the Gateway project, which will provide 1.5 billion cubic metres of extra capacity by 2014. That storage capacity is on top of the increase in import capacity in recent years, representing 125 per cent. of annual demand.

But in layman’s language, does that not mean that there will be just two days of additional gas storage available by the end of 2012? At a time when we are hugely dependent on imports, is the Secretary of State satisfied that that is sufficient?

I do not know whether the right hon. Gentleman was present for the energy security debate in the House some weeks ago, but the hon. Member for Tunbridge Wells (Greg Clark) discovered in that debate and through asking other questions that simply quoting storage numbers when we have the North sea, import capacity and liquefied natural gas facilities tells only a small part of the story. Indeed, the National Grid dismissed his statistics as a “meaningless number”. We do need more storage capacity, but the most important thing is changing the planning system. We are doing that through the Infrastructure Planning Commission, which will now be responsible for onshore wind. The suggestions of the right hon. Member for Bracknell (Mr. Mackay) would best be directed at those on his Front Bench, who oppose our reforms in relation to the Infrastructure Planning Commission.

The Secretary of State will be well aware of the major contribution, certainly over the past few months, of the two LNG import terminals in Pembrokeshire and the Isle Of Grain in Kent. Up to 27 per cent. of annual consumption is provided through those terminals. Bearing in mind the future reduction of North sea capacity, and the possible risks of the continental connection, will the Secretary of State talk to the Crown Estate, with which the UK gas storage association is having major difficulties in reaching agreement about offshore storage?

My hon. Friend has made two important points. The first was about LNG facilities. I can tell him that the LNG facility at Milford Haven, which was not in operation last year, currently meets about 10 per cent. of total UK gas demand. That is one of the ways we are meeting our gas needs as the supply of the North sea declines. As for my hon. Friend’s second point, although the Crown Estate is independent of Government, we continue to think about the issues involved. The recent licensing of the Gateway project suggests that they can be dealt with.

The right hon. Gentleman agrees that we need more gas storage. Can he tell us how many days’ supply we have at this moment?

There are different estimates. It depends whether we take account of the North sea, LNG facilities, and the fact that medium-range storage can be refilled.

The hon. Gentleman tried this in January, when we experienced very cold weather. It was not me but National Grid that said he was producing a “meaningless number”. I can tell him that alarmism about energy security does him, and political debate, no good at all.

I should have thought that the Secretary of State would inform himself of the day-to-day storage levels. For 18 months the Business, Innovation and Skills Committee, chaired by my hon. Friend the Member for Mid-Worcestershire (Peter Luff), has been warning that we need more gas in storage. Let me give the Minister the answer that he was unable to give me. As of last night, we have three days’ worth of gas in storage. That is the lowest level for many years, despite the fact that as imports increase we need a greater security margin. Other countries have more storage, Ofgem says we need more storage, and the Select Committee says we need more storage. Does the Secretary of State agree that it is time the Government had a policy on what our security margin should be?

The strange thing about the hon. Gentleman is that, although he talks a lot about gas storage, he has not one single policy in favour of having more of it. [Interruption.] The hon. Gentleman asks me, from a sedentary position, what my policy is. The single most important policy that we are pursuing relates to the Infrastructure Planning Commission, which will deal with one of the biggest gas storage issues that we face by reforming planning. What is the hon. Gentleman’s policy on the Infrastructure Planning Commission? His policy is to abolish it, and that says all we need to know. Once again, the Conservative party’s policy has not been thought through, and they are not ready for government.

Greenhouse Gases (India and China)

4. What recent discussions he has had with the Indian and Chinese Governments on their policies to reduce greenhouse gas emissions. (318543)

I had many discussions with Indian and Chinese representatives at the Copenhagen negotiations which led to the Copenhagen accord, in which both China and India set targets in time for the 31 January deadline. Since Copenhagen I have also discussed climate issues with the Chinese ambassador to the United Kingdom—until she recently became China’s Vice Foreign Minister—and various issues, including those relating to climate and energy, with Anand Sharma, the Indian Minister for Commerce and Industry.

Many people in this country do their bit to cut carbon dioxide emissions—I, for instance, drive a biofuel car—but that will pale into insignificance unless we can persuade the Indian and Chinese Governments to do more. Why does the Secretary of State think so little progress has been made?

I think more progress has been made than would seem apparent from the disappointment of the Copenhagen negotiations. The Copenhagen accord covers about 80 per cent. of global emissions. This is the first time that we have secured an agreement that covers such a wide range of emissions across the world. We need to turn it into a legally binding document, which is, in a sense, the biggest challenge that we face. The reason the task is so difficult is that these are very big issues about the future of different economies across the world.

My right hon. Friend will be aware that not far from his constituency, in Brigg and Goole and other constituencies on the south Humber bank, are companies such as Corus, Singleton Birch and, in Goole, Guardian Glass, which are being expected—rightly—to reduce emissions as part of the Government’s overall strategy, but are competing against companies that are setting themselves up and building new plants in countries with fast-growing economies, such as India and China. They feel that is unfair and that there is no level playing field, because they are having to take action that the companies in those other countries are not. When will my right hon. Friend be able to make more progress, so that we can report to workers in this country that they are not being unfairly discriminated against?

My hon. Friend has made an important point. It is because of that situation that there are provisions in the EU emissions trading scheme to protect against so-called carbon leakage. We give out allowances free to the most exposed sectors, rather than auctioning them. The European Commission is currently examining the different criteria, and will make further announcements later this year.

The other point I would make is that there is also a first-mover advantage for us in getting ahead in this low-carbon technology, and it is important that we do that as well.

As you know, Mr. Speaker, the shadow Minister with responsibility for climate change, my hon. Friend the Member for Bexhill and Battle (Gregory Barker), cannot be here today as he is in Beijing meeting Chinese Ministers responsible for those issues.

We admired the Secretary of State’s work in advance of Copenhagen—I think he knows that—but in the aftermath of Copenhagen, perhaps for reasons of understandable frustration, he accused China of trying to hijack the summit and of holding other countries to ransom. On reflection, does he regret that approach, and does he believe that as no global deal is possible without China, he should take steps to understand why China felt a global deal was not in its interests, with a view to persuasion rather than condemnation? Also, does he have a positive—

Order. I have said on innumerable occasions that questions from the Front Bench are all too often simply too long. The hon. Gentleman has put a question, and I know he will look forward to hearing the reply.

I do not regret being open and honest with people about why the Copenhagen negotiations did not achieve all that we had hoped, because I think that is a very important duty in politics. We went to the Copenhagen negotiations to try to secure a legal treaty and global targets, and it is right to explain to people why those ambitions were not achieved. It is also right to say, as I made clear in my discussions with the Chinese ambassador, that the task now is to move on and work with China, India and others to try to resolve the remaining differences.

Does my right hon. Friend agree that, in our discussions with the Chinese, we would be in a better position when talking about emissions from coal-fired power stations if the previous Tory Government had not been so short-sighted and closed down the clean coal technology research project and research into improving the thermal efficiency of coal-fired power stations? [Interruption.]

My right hon. Friend is absolutely right, and it is very clear from Conservative Members’ responses to that question that they do not like to be reminded of their past, and it is no wonder—although I know that the hon. Member for Tunbridge Wells (Greg Clark) was in a different party in the period referred to.

My right hon. Friend is right. I think there is an important future for clean coal in this country. That is why it is important that the Energy Bill makes the carbon capture and storage levy available to support that.

Project Discovery

Ofgem’s consultation is one of a number of resources that my Department is taking into account in its ongoing work on maintaining secure and affordable energy supplies during the transition to a low-carbon economy.

Why have the Government done so little to prepare for the hon. Gentleman’s Department’s forecasts that up to 16 million households could be sitting in the dark by 2017, and is the fact that only three Labour MPs have questions on the Order Paper today indicative of his party’s lack of concern about this issue?

I am sorry that the hon. Gentleman takes such a low view of policies that are delivering on investment, price and supply in this country. If he wants solid evidence of that, he need only look back one month to one of the severest winters in decades, when the system in this country coped extremely well.

My hon. Friend will recognise that Ofgem faces difficult problems. We, as the former owners of the generating facilities and energy companies, have suffered badly in that we were ripped off. We did not realise that the payment was only a down payment, and we have been ripped off every year by these companies ever since. When will my hon. Friend ask our right hon. Friend the Secretary of State for Health to provide a set of NHS gnashers to give to the toothless watchdog we have got—the regulator?

I am grateful to my hon. Friend for his robust expression of a dissatisfaction that is felt throughout the House with the performance of the regulator since privatisation of the energy sector. However, I can assure him that in the Energy Bill that this House voted in favour of last night there are measures to strengthen the powers of Ofgem.

As the Minister will be aware, it is estimated that about £200 billion will need to be invested in energy production in the next decade if the lights are not going to go off. In the light of that figure, does he think that the £800 million-plus profit that British Gas announced today should be used for further investment or cutting bills?

The hon. Lady invites me to answer one of the key questions. We want energy companies to invest £200 billion in infrastructure projects in this country over the next decade, so we should celebrate the fact that they are successful global companies that do make profits. However, when those profits are excessive and members of the public are struggling to pay high energy bills after four successive years of very big increases, we are entitled to say that as world prices fall the customers should share in that benefit.

Given that the big energy companies have made the highest ever profits over the past five years and that only today British Gas announced a profit of nearly £600 million, which is an increase of more than 50 per cent., why should anybody support a party that, as the hon. Member for Tamworth (Mr. Jenkins) indicated a moment ago, has so abysmally failed to take on the big energy companies, stand up for consumers and give us a regulator that does anything useful to justify its existence?

The hon. Gentleman clearly did not listen to the previous question and answer, nor the one before that. It is important that we have successful energy companies but, equally, because of the monopolistic elements of their industry, it is important to have a strong regulator. As I have just said, we are legislating in the Energy Bill to make that regulator stronger.

Last July, the Secretary of State told the House that

“gas imports…will be kept to 2010 levels for the whole of the following decade”.—[Official Report, 15 July 2009; Vol. 496, c. 293-94.]

Yet both Ofgem and the National Grid Company say that gas imports will rise substantially during the next eight years and that 70 per cent. of our gas will be imported. Who is right?

The Government stand by the UK low carbon transition plan, which we published last year and which contains our favoured scenario for what will happen by 2020. The hon. Gentleman asks who is right and who is wrong. There are a range of views on this and we are taking them all into account as we develop our energy market assessment, the first findings of which will be announced alongside this year’s Budget.

The Minister has just confirmed that the Government take a different view from the regulator. When it was disclosed that his Department expected power cuts in 2017, the Secretary of State dumped the data and changed the figures. Yet this month Ofgem, the regulator, has said:

“In 2017 we get to the really sweaty-palm moment in terms of possible shortages”.

It talked of the “profound” and “worrying” state of

“collapse in energy supply from 2013”.

Ofgem has rubbished the Secretary of State’s complacent assumptions on gas and electricity and has called for a different policy on security. Why has the energy regulator lost confidence in this Secretary of State?

I just mentioned the low carbon transition plan, which suggests a major investment in the trinity of clean coal, nuclear and renewables. It is unfortunate that in every one of those areas the hon. Gentleman’s party is obstructive—I am thinking of the approach it has taken on the planning system for nuclear power with the Infrastructure Planning Commission, on the proposed levy, and on the introduction yesterday of the proposal by some Opposition Members of an emissions performance standard. On renewables, he does not have to look far behind him to see the Members who do not agree with developing wind power in this country.

Coal-fired Power Stations

8. What plans he has to limit the level of carbon dioxide emissions from coal-fired power stations after 2020. (318547)

The Government’s “A framework for the development of clean coal”, which was published in November, delivers a comprehensive package of policy measures that will drive the transition to clean coal to 2020 and beyond. Our ambition is that any new coal plant constructed from 2020 will be fully carbon capture and storage from day one and that coal-fired power stations with demonstration projects will retrofit CCS to their full capacity by 2025.

The energy industry needs a stronger signal now that the Government are serious about getting carbon out of energy; otherwise it will not make the necessary investments. The emissions trading scheme is not working, and last night the Government blocked the introduction of an emissions performance standard. Why will they not take on the power giants, introduce legal limits on power stations and force them to cut their carbon emissions drastically?

I have to tell the hon. Gentleman that we have the most radical and most environmentally demanding coal policy in the world, and we have the greatest incentive to industry to invest with the CCS levy. Frankly, not a single company and not a single independent adviser such as the Committee on Climate Change would support him in saying that introducing an emissions performance standard at this point would be appropriate.

Why have the Government rejected the findings in the report they commissioned from Oxera, which recommended raising the cap on the amount of biomass that coal-fired power stations such as Drax can blend with coal from 12.5 to 17.5 per cent.?

I thank my hon. Friend for that important question. We are looking at the whole field and at the use of biomass. This is not a technology in which we can have total confidence at the moment. There are issues of sustainability in the production of the biomass, if it involves new crops, and the burning of biomass brings up air pollution issues, too. We have to take some time over this. We are in discussions with people at Drax and we will be considering the issues that they raise about investment, incentives and the cap.

National Grid (East Anglia)

9. When he next expects to meet representatives of local authorities in East Anglia to discuss the operation of the national grid. (318548)

The Secretary of State has no plans to meet the representatives of local authorities in East Anglia to discuss the operation of the national grid.

Is the Minister aware that Centrica is going to double the size of the King’s Lynn gas-fired power station, which will mean that it will need the national grid to connect the new power to its main power lines with new pylons, which will be extremely unsightly. What is his policy for burying such new pylons underground?

I think I am right to point out to the hon. Member for Tunbridge Wells (Greg Clark) that this is one of the hon. Members who is against developing wind power in this country. We need £200 billion of investment in our energy infrastructure over the next decade, some of which will be for the cables that deliver the power from the place of generation to the place of consumption. On the whole, overhead power cables have been the most robust and cost-effective way of delivering that energy in the past.

Microgeneration

10. What recent estimate he has made of the likely proportion of the UK’s electricity supply to be generated by microgeneration technologies in 2020. (318549)

Among EU countries, the UK lies behind everyone except Luxembourg and Malta in renewable energy use. What lessons does the Minister think he can learn from more successful EU member states?

Clearly not to follow the example of Conservative Members in opposing renewable energy developments, but rather to follow successful Labour policies, such as the one that makes us the lead in the world in offshore wind. The hon. Gentleman’s question was about microgeneration, so perhaps we can return to the subject of feed-in tariffs, which a Labour Government are introducing from this April and which will encourage these developments.

Does my hon. Friend know that Carbon Connect’s progress report on low-carbon technologies, on the commercial barriers and on how we overcome them will be launched somewhere around Westminster this lunch time?

Carbon Emission Reduction (Local Government)

11. What recent assessment he has made of the contribution of local government to meeting the UK’s carbon emission reduction targets. (318550)

Local authorities have a key leadership role in reducing their emissions and those occurring within their areas. The Government have announced a pilot of local carbon frameworks, which aim to increase the contribution of local authorities to meeting the UK’s carbon emissions reduction targets.

Estimates of per capita CO2 emissions for 2007, and revised estimates for 2005 and 2006, for all UK local authorities and Government office regions were published on the DECC website on 17 September and were updated on 9 November.

DECC also collects statistics on the CO2 emissions of local authorities’ own estate and operations. The Department is analysing returns for the year ending 31 March 2009 and will publish the figures soon.

I thank the Minister of State for that answer. May I press her on what powers and resources the Government intend to give to local authorities to enable them to promote green technology and sustainable development and to meet their carbon reduction commitments?

I shall begin with the carbon reduction commitment, which is, of course, a national scheme being introduced this April. Within that, local authorities will have a duty to look to their energy efficiency, and their resulting emissions will have to be measured. They will have the opportunity, in the first year, simply to record that information. We will, of course, assist in that. In order to reduce their emissions and increase their energy efficiency, they get assistance from the Carbon Trust and Salix finance loans are available. We have a very good record of working with local government. The indicators are there through the local government performance framework, and local authorities have sufficient powers to make the necessary changes. Of course, they will make a vital contribution.

An appropriate planning regulatory regime is essential for local authorities to develop local emissions reduction projects in their areas. What assessment has been made of potential changes to planning regulations that impede such developments?

Some concerns have been expressed by local authorities, and, indeed, by individual households and businesses, about the ability to introduce new technologies in a way that is consistent with local needs and local views. We have given local authorities the right to determine their own planning policies to an extent, as well as, more recently, to agree permitted development so that we can make some progress with small-scale microgeneration.

Prepayment Meters

Prepayment meters play an important role in helping some customers to control their energy expenditure and should remain an option for consumers. Smart meters will in due course replace current prepayment meters and we are committed to rolling out smart meters to all households. Meanwhile, the replacement of the older-style token prepayment meters was due to be nearly completed by the end of 2009. I await an update on the present position from Ofgem.

There is a lot of concern about energy prepayment meters because they are used mainly by those on lower incomes. Is it right that such people should pay more for their gas than those who are better off? When will prepayment meters be entirely phased out? Phasing them out would be a good thing, and that idea is warmly supported by Labour Members.

For the reasons that I have given, I do not, regretfully, agree with the hon. Gentleman about the presence and use of prepayment meters, but they will all be gone when we have smart meters by the end of 2020. In the mean time, one of the Ofgem licence conditions that I mentioned earlier was to rule out any unfair discrimination against users of prepayment meters. As a result, the differential between prepayment meter and standard credit rates has effectively been eliminated.

Does my hon. Friend agree that, while we wait for smart meters, it is right that the Government should intervene to prevent the most vulnerable people from being ripped off for having to use prepayment meters?

Yes; we called on Ofgem to carry out that probe, we supported the licence conditions that it proposed and I am pleased that they have been implemented.

Gas Storage

I am obliged to the Secretary of State, but may I refer him to the answer that he gave to the hon. Member for Carmarthen, West and South Pembrokeshire (Nick Ainger) regarding developments under the sea bed? Clearly, the Crown Estate holds the key to future developments under the sea bed, but the gas storage operators group accuses it of behaving it as a monopoly. What influence can the Secretary of State bring to bear on the Crown Estate to ensure that it behaves in a commercial manner?

It is fair to say that negotiations between the Crown Estate and gas storage operators are commercial negotiations, but we engage with that and we are in discussions with the Crown Estate. They make their own decisions about tariffs and fees, but we are due to talk to them about that. We can also help by making tax changes. For example, the tax change that we made in relation to cushion gas has helped to make storage more viable.

Boiler Scrappage Scheme

15. What assessment he has made of the effectiveness of the boiler scrappage scheme against its objectives. (318554)

The boiler scrappage scheme commenced on 5 January this year and is proving to be highly successful. It has, to date, received more than 95,000 applications. The scheme contributes to DECC’s objectives to reduce greenhouse gas emissions in the UK through reduced energy consumption and to ensure that the UK benefits from the business and employment opportunities of a low-carbon future. We estimate that the scheme will reduce CO2 emissions by between 1.1 million and 1.4 million tonnes a year.

I am grateful to the Minister for that answer. I am not surprised, and I am encouraged to hear about the take-up, but is she aware that, when condensing boilers are retrofitted, the water run-off pipe is often fitted on the outside of a building? When those pipes freeze, as is happening in the current freezing conditions, the boilers break, with the result that households have no heat or hot water. What are the Government doing to stop that happening?

From what the hon. Gentleman has said, perhaps Ministers ought to be taking a course in plumbing, although I must tell him that I have no plans to do so. I have a condensing boiler myself, and my external run-off pipe has not frozen, but he may be correct about this being something that we need to look into. However, I hope that he will not want to detract in any way from the great success of the boiler scrappage scheme and the huge savings in CO2 emissions—and therefore the good effects on climate change—that it is achieving.

Climate Change Research

16. What recent research he has (a) commissioned and (b) evaluated into the scientific case for man-made climate change; and if he will make a statement. (318555)

Last year, DECC and the Department for Environment, Food and Rural Affairs launched the AVOID research programme on avoiding dangerous climate change which assessed the scientific research published since the Intergovernmental Panel on Climate Change’s fourth assessment report. The findings informed the UK delegation ahead of Copenhagen. The integrated climate programme at the Met Office Hadley centre is also providing new climate science research and expert advice on the findings of that research.

I thank my hon. Friend for that answer. In this country, there has been a broad consensus that the risk of dangerous climate change is real. It is based on broad and deep scientific evidence, with acknowledged uncertainties, that we cannot go on pumping billions of tonnes of greenhouse gases into the atmosphere without serious adverse effects. Does she agree that, if we are to continue to take the right decisions for the long term, it is important that that political consensus is maintained, and that we should not be distracted by the noise being made by those who claim that climate change is not a serious risk?

I agree absolutely with my hon. Friend. We have seen nothing that undermines the main body of climate research, which goes back many decades and has involved some of the best scientists in the world. Although it is clear that there have been some errors and possible misjudgments, we know that CO2 emissions in the atmosphere are growing at an unprecedented rate. We have every reason to accept that that is the result of human activities. I am pleased that the consensus that it is human activities that are leading to the excessive warming that we see, and to the other climatic effects that we associate with climate change, holds across this House.

Oil Refining

17. What recent discussions he has had with the petroleum industry on capacity reductions in the oil refining sector. (318557)

The UK operates a market-based approach to the supply of refined products, and it is therefore a matter for individual companies to determine how best to meet their customer demand and what level of refining capacity is needed to do that. However, my Department has an ongoing dialogue with the UK downstream oil sector, including the oil refining industry as represented by the UK Petroleum Industry Association. As part of that dialogue, we recently commissioned and published a report by respected independent consultants on the UK downstream oil infrastructure.

I thank the Minister for that reply, and for making time before Christmas to meet me to discuss this issue. However, is he aware of the enormous concern among UK refiners about the renewable heat incentive? They believe that it will load them with an additional cost burden and place them at a severe competitive disadvantage, which will only raise and heighten fears about potential plant closures and enormous job losses as a result.

Yes, I am aware of the concern that the hon. Gentleman refers to, and I met members of the PIA this week to discuss that and other issues. The Government are listening to their point of view, and we have responded to their representations already. I know that the Treasury has certainly got in mind their point of view as it works toward this year’s Budget.

My hon. Friend will be aware of the sale of Grangemouth, and that Stanlow in my constituency is up for sale. Will he ensure that the Department keeps a close eye on the broader public interest and, specifically, that it helps at a local level to ensure that the work force are properly protected in such circumstances?

I am grateful to my hon. Friend. There have been a number of reviews by participants in that market in recent years, and I agree that it is important that all members of the industry are engaged in such reviews, including the work force and their trade union representatives.

University of East Anglia Climatic Research Unit

19. Whether he has had recent discussions with representatives of the university of East Anglia on the work of its climatic research unit. (318560)

The Secretary of State has not had any recent discussions with representatives of the university of East Anglia on the work of its climate research unit.

Does the Minister not agree, though, that it would be useful to have such conversations with that climate change unit in order to argue that, for the sake of belief and faith in climate change, those figures should be credible? Do you think that we should ask the university to conduct an independent inquiry, or, if it is unable to do so, that the Government themselves should initiate an independent inquiry?

Indeed, I do, Mr. Speaker. I do not think it appropriate for us to be in discussion with the university of East Anglia. It has announced that an independent review, chaired by Sir Muir Russell, will look into the data and the e-mail hacking incident. It will report later in the spring, and those findings will of course be made public. That is appropriate.

On our belief in the science, I have already said in answer to my hon. Friend the Member for Birmingham, Selly Oak (Lynne Jones) that the Government remain absolutely convinced. We believe that the data worldwide are robust, and we have no reason to question them. However, it is appropriate that the East Anglian incident be investigated thoroughly.

Topical Questions

My Department works with others to ensure that Britain can take the lead in low-carbon manufacturing. Today we are announcing a new research and development facility for offshore wind blade testing in Blyth, following Government investment of £18.5 million. We also welcome Mitsubishi’s announcement that it will locate its offshore research and development facility in the UK, creating 200 skilled jobs, following last week’s announcement by Clipper Windpower about its factory in the north-east.

I obviously thank the Secretary of State for that detailed response, but it will not have anything to do with my question.

A 92-year-old, partially sighted, disabled constituent has written to me on the advice of Age Concern about her serious problems over two years with the Warm Front team, which installed a condenser boiler. The problem to which my hon. Friend the Member for Ludlow (Mr. Dunne) referred but did not receive a sensible reply has caused a total breakdown of the boiler. Warm Front can do nothing about it, and my constituent has had to spend more than £200 herself on a private contractor to provide her with heat. Will the Government do something about it, and will the Secretary of State look into Warm Front’s ineffective and inefficient operations?

The hon. Gentleman raises a serious question about his constituent, and I assure him that if he passes the details to us my hon. Friend the Under-Secretary will look into it urgently and talk to Warm Front about sorting out the problem. When the Department came into being, there were a number of complaints about Warm Front, and we took a whole series of actions to improve the value for money and operation of the scheme. I think that they are having an effect, but when things go wrong, we want to take action as quickly as possible, working with Warm Front, and we will do so in that case.

My hon. Friend will be aware that there have been 592,000 chronic obstructive pulmonary disease claims and 170,000 vibration white finger claims. In other words, 750,000 claims have gone through his Department, so a great deal of experience in them will have been gained. Will he ensure that in future, if there is a potential liability relating to a prescribed disease in the mining industry, it will be dealt with by a scheme, rather than by the courts at an enormous cost?

Yes, I acknowledge the huge scale of the two compensation schemes that my hon. Friend mentions, and more than £4 billion of taxpayers’ money has been paid out in compensation to miners who have suffered some horrendous injuries. I think that my hon. Friend alludes predominantly to the knee injury litigation that is ongoing, and I assure him that we have attempted to learn all the lessons of those earlier schemes in order to ensure that, if liability is established, we act in the way that he asks me to do. In the meantime, I credit my hon. Friend and others who have made representations to the Government about that knee condition for a new industrial injury benefit, which is now in place.

The recently announced feed-in tariff creates a two-tier structure for small generators that feed into the grid, leaving those who were prepared to take the initiative in the early stages, at their own financial risk, much worse off. How do the Government justify that unfairness?

I have sympathy with the point that the hon. Gentleman has raised. However, he needs to bear in mind the fact that all the schemes impact on everyone, and we all have to make a contribution if the issue is to be addressed. The whole point of setting the feed-in tariff now is to enable the generation of more renewable energy, and that is why it requires the best possible incentive. Those who have already taken the initiative on their own account will not be producing more generation, and the Government’s aim has to be to get more in place and to create the incentive to make that happen. If we were to equalise the payment, that would not create more generation or more CO2 savings.

In my home town of Dundee, tens of thousands of people have claimed the cold weather payment over the past year. I hope that the Minister agrees that there is still much to be done. Does he also agree that without the cold weather payment and the winter fuel allowance, many of the most vulnerable in our society would have to endure the unacceptable face of fuel poverty?

I am grateful to my hon. Friend. That is part of our strategy of addressing the problem of people’s incomes and ability to pay energy bills. He is right that even during this toughest of times and the recession that we have been through, a Labour Chancellor has maintained the higher amounts of both the winter fuel allowance and the cold weather payment this year, because he understands that that is the right thing to do for the vulnerable people involved.

T2. Ofgem’s latest figures show that prepayment meter customers, who are often from the poorest households, are still paying up to £60 a year more for their electricity and up to £107 a year more for their gas. Given the profits being made by the energy companies, will the Secretary of State ask them to eliminate that differential completely? (318566)

We have eradicated the differential between prepayment meters and the standard credit, so the hon. Gentleman has now moved on to the differential between the prepayment meter and direct debit. At present, the licence condition is that a cost differential is permissible to reflect simply the extra cost of providing the means of payment. According to Ofgem, a prepayment meter costs about £88 a year more to administer than a direct debit. That would be the difficulty for me in acceding to the hon. Gentleman’s latest request.

On steel and energy, will the Secretary of State support the view of the Community union that the carbon credits for Tata’s Teesside plant should be held in trust until the company agrees to talk with the Government and the union on resuming work there? Will he also meet me and colleagues to look at an over-rigorous interpretation of an EU regulation that might seriously damage electric arc furnace steel making in the UK?

I am sure that we can arrange a meeting with my right hon. Friend on the second question that he raised. On his first question, I should say that the Teesside issue is important. My right hon. Friend Lord Mandelson continues to be in discussions about the serious matter of what can be done at the plant. We will continue to take those discussions forward.

T3. The disparity between wholesale and retail energy prices is woefully lacking in transparency. Even Consumer Focus, the Government’s own watchdog, has said that households could be paying as much as £74 a year too much. The Government seem to have dithered over the issue. Will Ministers follow our advice and take some decisive action by referring the matter to an independent inquiry? (318567)

As I have said before in the House, I am not in favour of referring these matters to the Competition Commission if we can avoid it, because that will tie the whole energy industry up in knots. What is our strategy as a Government? It is to give the regulators more power, as we are doing in the Energy Bill; to eliminate some of the worst unfairnesses—in respect of prepayment meters, for example; and, rightly, to say to companies that they have a responsibility not only to their shareholders but to customers. We are doing all those things.

On transparency, it is only because the Government have got Ofgem to publish a quarterly report on the relationship between wholesale and retail prices that we now know what that relationship is.

Does the Minister understand that up to 40 per cent. of domestic energy bills can be accounted for by heating hot water, and that much of that can be wasted through inefficient installations? Is he talking to the Minister with responsibility for water at the Department for Environment, Food and Rural Affairs about the synergies between smart metering roll-out in water and electricity and other synergies between water efficiency and energy efficiency?

I clearly should be, and following my hon. Friend’s request I am sure that we will do so. She makes an important point about the heating of hot water and the role that can be played by the kind of technology that can both heat hot water and help to heat people’s homes—combined heat and power. There is a lot to be done in that area. We are introducing the renewable heat incentive, which will make an enormous difference to people in heating their homes, but we will also engage in the discussions that she suggests.

T5. Will the Secretary of State speak to Unite in the strongest terms about its proposed industrial action at the port of Milford Haven, which, although temporarily postponed, would risk cutting off access to vital supplies of crude oil and liquefied natural gas? Our energy situation is too fragile for security of supply to be used as a tool in industrial disputes, no matter how legitimate the grievances of the employees concerned. (318569)

The hon. Gentleman raises an important issue. While this is of course ultimately a matter for unions and management to resolve, we have engaged in discussions with both sides on these issues. I am pleased that the strike action that was due on Tuesday of this week did not go ahead, and I very much hope that a satisfactory resolution can be reached.

I am sure that my right hon. Friend shares my concern that we exploit every drop of gas and oil in and around our own waters. May I congratulate him on the introduction of the field allowance in the North sea, which is proving so successful? I put it to him, in the same terms, that the brownfield sites around the same area, but a bit further away from the existing production facilities, may have 80 per cent. of what is recoverable, and that we should introduce something that makes those equally viable.

My hon. Friend draws attention to an important decision made by the Chancellor about the field allowance, which I believe was initially introduced in the last Budget. He built on that in the pre-Budget report, and has since made further announcements on it. I will ensure that this is brought to his attention, and I am sure that he will be looking at the issues that my hon. Friend raises.

T7. Thank you, Mr. Speaker. [Interruption.] I come hot-foot from a meeting at your office, Sir. Does the Secretary of State agree that despite the controversy over the university of East Anglia e-mails, the science is very clear, not least from other data sets, that global warming is real, and that we should not be distracted by this controversy from insisting on our policies? (318571)

I congratulate the hon. Gentleman on his just-in-time questioning. He raises an important issue. Clearly, mistakes have been made, and it is important that those are looked at and that the Intergovernmental Panel on Climate Change looks at its procedures. I have written to Dr. Pachauri to emphasise our support for the organisation, but also our wish that it looks at its procedures to try to eliminate such errors. The overall picture is very clear: climate change is happening, it is real, and it is man-made. It is very important to say that.

I should like to press the Secretary of State on the answer that he gave earlier on Warm Front. Does he think that there is a potential conflict of interest while Eaga is effectively allowed to award itself contracts for Warm Front grants? What steps is he taking to put a stop to that practice?

I am grateful to my hon. Friend, who recently came to see me personally to talk about that issue. Among the changes that my right hon. Friend the Secretary of State mentioned was ensuring that Eaga is put on the same footing as any other contractor in having to bid competitively for contracts under Warm Front, in the same way as anybody else.

T8. Will the Secretary of State make every effort to republish and promulgate the conclusions of the Stern review, which make very clear the huge cost to our children and grandchildren if we do not take action now to tackle climate change? The costs will be huge and fall heavily on future generations. (318573)

The hon. Gentleman makes a point that is central to this debate. We need to be open about the fact that there are costs to acting on climate change, but we know that the costs of not acting would be greater. That central conclusion of the Stern report is important in shaping the climate change debate, and he is right that we should emphasise it.

Will my right hon. Friend the Secretary of State look closely at what is happening in terms of sustainability and progressive environmental policies in Kirklees council, in whose area my constituency sits? Will he particularly examine the warm zone initiative, which is so successful that many local authorities are coming to look at it? May I invite him to come and look at it himself?

My right hon. Friend the Secretary of State will have to answer for himself on whether he can go and look at that, but many of us have had conversations with Kirklees council and visited it, because there is no question but that it has been exemplary and pioneered work involving local government, energy companies and community groups all working together to get community solutions. It was part of the inspiration behind the community energy saving programme, which the Government recently rolled out and which is going extremely well. The programme will provide £350 million of funding in order that we get such real community endeavours off the ground on the same basis as Kirklees’ pioneering warm zones.

T9. Recent polls show that the British public have had a dramatic change of mind about whether climate change is man-made. Will the Government change their mind about the huge subsidies for land-based wind farms, which are not only ineffective but despoil the countryside? (318574)

No, we will not. Here we see what people worry about in relation to the Conservative party: an unchanged party, with people saying that climate change does not exist and that we should not go ahead with onshore wind. So no, Labour will not follow the hon. Lady’s advice.

My hon. Friend will be aware that progress is being made in the administration of Bowater in my constituency. Energy is a huge component part of the problem, so will he assure me that his Department will work with the Department for Business, Innovation and Skills to help facilitate the recovery of the business on that site?

As my hon. Friend knows, I take a keen interest in this issue, and I stand ready to help him in any way I possibly can.

As Britain is now a net importer of gas, is the Secretary of State happy with the fact that we have only 16 days of gas storage, compared with 99 days in Germany and 122 days in France?

I expect better from the hon. Gentleman. [Interruption.]Perhaps I should not expect better. The truth is that, as I said in our earlier discussion, the National Grid has clearly said that those numbers are meaningless, because they do not take account of our indigenous supplies. It is really important to emphasise the role that our indigenous supplies continue to play along with imports and storage.

Now that the Energy Bill, which relates particularly to carbon capture and storage, has passed all its stages in this House, will my right hon. Friend talk urgently to the Crown Estate and the energy companies operating in the North sea about the continuity of maintenance of pipelines between oil and gas extraction and carbon storage?

My hon. Friend raises an important issue, and we are in dialogue with the Crown Estate about a whole range of issues including the one to which he draws attention. I thank him for his role in the Bill, and the important thing now is to get it on the statute book as soon as possible.