Motion made, and Question proposed, That the sitting be now adjourned.—(Mr. Heppell.)
I am pleased to have the opportunity to raise the issue of home energy efficiency and fuel poverty. When I applied for the debate, there were a few key issues that I wanted to bring to the Chamber’s attention and to press the Government on, but I was inundated with a huge variety of information and lobbying from a great diversity of sources. I must apologise to some of those people who brought such issues to my attention because I cannot address them all, but perhaps other Members will. I shall concentrate on a few areas in which I have a particular interest or concern.
On the basic issue of fuel poverty, we should recognise that we are almost back to where we started from 10 years ago. We saw a dip in fuel poverty, but it has risen sharply and it is estimated that between 4.5 million and 5 million households across the United Kingdom are in fuel poverty, which is back to the same levels that we experienced 10 years ago. Being a Member of Parliament for a Scottish constituency, I must emphasise that the proportion of people in fuel poverty or suffering from the problems of high-cost heating is much higher. Statistics compiled by the House Condition Survey in Scotland show that 618,000 households in Scotland—27 per cent. of the total—are in fuel poverty, which is up 47 per cent. over the past five years. A third of those are in extreme fuel poverty, by which I mean that they spend more than 20 per cent. of their income on fuel.
Energy Action Scotland believes that even those figures are an understatement and that as many as 750,000 households could be in some degree of fuel poverty. Such statistics are central to the debate, but for every household in fuel poverty, there are others who are not technically in poverty but have real problems with heating their home and paying their bill, and they are equally interested in what the Government can do to deal with the situation.
I shall raise a few aspects of home energy efficiency and fuel poverty, and await the Minister’s reply with interest. Let me start with hard-to-treat homes. It is astonishing to discover what proportion of the UK housing stock is classified as hard to treat. Some 43 per cent. of households in England and more than 50 per cent. of households in Scotland are, in one form or another, hard to treat. They are mostly houses with solid walls or the early timber-framed houses, and flats and homes in multiple occupancy.
Under the carbon emissions reductions target, energy companies are required to promote insulation and efficiency, but evidence suggests that they tend to take the easy way out by, for example, issuing low-energy light bulbs rather than investing in significant insulation or alternative forms of heating. Hard-to-treat houses have pretty well been ignored by the energy companies. For many, the main way to tackle the problem is through external wall insulation, or external cladding, or, in some cases, internal cladding. By definition, such houses are hard to treat. Cavity wall insulation or loft insulation does not do the job. In addition, they need lower cost, carbon-free, low-tariff fuel systems, and for many, the packages are simply not available.
It is worth recording the fact that the social housing sector faces huge bills to tackle the problem. Dealing with the existing housing stock reduces the pool of funds available for providing new houses. A couple of examples have been brought to my attention. Aberdeen city council, which has been considering its high proportion of hard-to-treat houses, has recently upgraded 4,505 dwellings in multi-storey flats through a combination of cladding and combined heat and power district heating systems. The cost of the cladding was such that the council concluded that it could not clad them all. Effectively, it ended up installing more efficient heating systems, which heated the air as much as the buildings. Therefore, although such a system was beneficial to the tenants in that they could afford the heating, it did not solve the entire problem of the waste of energy.
Orkney council has also instigated a pilot scheme and spent £3.5 million on external cladding on a number of its houses. All over the country, local authorities and housing associations are independently tackling the problems without any real exchange of information or co-ordination, which is not the most efficient way to deal with the matter.
I welcome you to the Chair, Mr. Cook, and congratulate the right hon. Gentleman on obtaining this Adjournment debate. He will know that the Scottish Government home insulation scheme attached some criticism to the time it was taking to bring schemes to different areas of Scotland and to bring homes up to standard, as was the case with Northern Ireland in relation to the criteria used for how people apply for such schemes.
Does the right hon. Gentleman think it would be beneficial for the two regional Ministers to consult, and therefore exchange ideas, on how we could move the schemes forward and help in particular those suffering from cancer, who really suffer from the cold and need their homes to be insulated?
I take the point. As the hon. Gentleman will know, I believe in devolution, but I do not think that that means that we cannot co-ordinate effectively. The UK Government have a role to play in encouraging such co-ordination, particularly when it is about facts, information, best standards, value for money and cost-effectiveness. I completely agree with him, and the Minister will have his opportunity to address that matter. I will say only that the Government roll out schemes one after another, but it is difficult to find out how they co-ordinate them.
Let me finish on the issue of hard-to-treat homes. I have had a long and extended conversation with one particular constituent who is exercised by the issue. She is very aware of what is going on, and thinks that a lot of her neighbours do not realise how inefficient their homes are. She has had a thermal imaging take done on her house, which shows just how much energy is leaking, and her house is the same as all the others in the street. Her concern is that no one will tell her what is the best thing to do. She does not know what materials to get, there is no financial assistance or technical advice, and she has not been able to resolve her problems. She suggests a co-ordinated approach that applies the best technique and best advice, possibly reducing or abolishing VAT on the materials and providing certificated standards across the country. The Government should consider such issues rather than just accept the appalling situation in which half our housing stock is hard to treat and we have no co-ordinated response to deal with it.
Let me say as an aside—I do not want to dwell too long on this—that whenever we discuss the issue we should also consider the extra winter deaths that are directly attributable to fuel poverty. Such deaths have increased this year because of the cold winter. That issue never arises in Scandinavian countries because they do not have hard-to-treat homes. They have much better standards and efficiency, and I believe that we, too, should tackle the problem in a much more effective way.
Does the right hon. Gentleman agree that in rural areas such as Norfolk, where my constituency is located, an awful lot of retired people and pensioners have no choice but to use oil, because no other source of energy is available to them? They are penalised for living in a rural area and by the punitive costs that the oil companies place on them. Therefore, their poverty becomes worse.
I am very grateful for that intervention, because it precisely anticipates the next paragraph of my speech, which is about that point. People in rural areas who do not have access to mains gas depend on other forms of heating—mostly oil, but sometimes liquefied petroleum gas or some other alternative.
I was surprised by the figures on the issue. They might be incorrect and the Minister might have more accurate ones, but my information is that 1.5 million households do not have access to mains gas and 1 million of those households are in Scotland, which is a much more rural country. The rest are probably in Norfolk—I do not know.
The cost of heating fuel for someone who is not on the gas mains is, on average, a third higher than for someone who is on the gas mains. I have been a Member of the House for rather a long time and when British Gas was being privatised, I served on the Committee scrutinising the Bill that privatised it, which became the Gas Act 1986. I also got involved in a stand-up, dragged-out row with Sir Denis Rooke—not a difficult thing to do—on behalf of my constituents at the time, because the gas mains were not being extended. As a result of that row, I got significant gas mains extension in several communities across my constituency.
However, I predicted that the privatisation of gas—this issue is about not the ideology of privatisation, but its consequences—would pretty much stop the extension of gas mains to anything other than major new developments, which has happened, although it is somewhat unacceptable.
In that context, if the Government are unable to do more to ensure the extension of gas mains—I would add that, even if they do ensure that extension, a lot of properties cannot be put on the mains—I wonder whether they will specifically address the needs of those households that are not on the gas mains.
I congratulate the right hon. Gentleman on securing the debate and on his speech. However, the situation is even worse than he describes, because the gas companies hold the individual households to ransom, charging ridiculous sums for connection fees. That is so unfair, given that the connection fees for everybody else who is connected were all lost in the capital costs. Those people without connection are being forced to pay the total cost of connection.
I completely agree with that point. At the time of the privatisation of British Gas, I formed a good alliance with the gas regulator, who challenged British Gas over its assertion that it could not afford such connection costs. He said that, if he was not satisfied with the costings of British Gas, he would force it to absorb the costs itself and he did so. Unfortunately, such engagement does not appear to exist any more.
Therefore, I repeat my question to the Minister: why, for example, should the energy companies not be required to prioritise in their alternative energy, renewable energy and insulation programmes those people who are not on the gas mains? Furthermore, on the proposal to introduce micro-combined heat and power, which could be a benefit, why are the Government also proposing a tax break that will make micro-CHP less attractive for gas and oil-fired CHP systems, even though those systems double the efficiency of a house’s heating arrangements?
It seems to me that there are things that the Government could do to ensure that people in rural areas who are off the gas mains receive priority treatment from the energy companies, but there is no indication that the Government are prepared to do those things.
I am sure that that would improve matters. The hon. Gentleman will appreciate that we have a different arrangement in Scotland, but I am aware of the issue involving double glazing. Double glazing is not the most efficient measure that may be taken, but clearly it is a relevant factor. There is not much point in putting in cavity wall insulation and loft insulation if all the heat goes out of the windows.
I want to move on to a subject that is topical, given the cold winter—cold weather payments. They are a very specific mechanism for dealing with fuel poverty. However, the mechanism for delivering cold weather payments means that millions of people lose out on them. It is estimated that 1.7 million people who would be entitled to the pension guarantee have not applied for it, and because they have not applied, they do not achieve the threshold—the “gate”, as it were—and so they are not eligible for cold weather payments, which they would otherwise automatically accrue.
In my constituency, it is estimated that 1,600 pensioners would be eligible for cold weather payments, but they have not applied for them, and I am sure that other Members have similar figures for their own constituencies. I do not wish to labour the point, but it is simply a geographical fact that Scotland is colder than the average for the United Kingdom.
Said with feeling by my hon. Friend.
The cost of heating a house in Stornoway is 62 per cent. higher than that of heating an identical house in Bristol. Within the cold weather payments, no account is taken of that fact. Therefore, the contribution that those payments make to people who live in colder parts of the United Kingdom is reduced.
I can testify that, in my own part of the world, we have had snow on the ground pretty well continuously, with only the odd break of a couple of days, since before Christmas. We have also had frost pretty well every night, and indeed for most of the day, for most of the period since Christmas.
I accept that it might be colder in Scotland than in other regions of the United Kingdom, but does the right hon. Gentleman accept that wages for people in Northern Ireland are lower than for those in the rest of the UK, and that, therefore, a higher percentage of people’s wages is used to heat their homes? People have to choose between heating their home and putting food on the table. That is a great cause of concern within my constituency.
Of course I completely accept the important point that the hon. Gentleman makes, and that situation increases the incidence of fuel poverty, given the percentage of people’s wages that is being spent on fuel.
I want to give an example. I am sure that many of us are out pounding the streets and highways and byways of our constituencies at the moment, even more frequently than we are wont to do normally. I left my home on Saturday morning to do just that. The temperature when I left was -6° C and there was about 20 cm of impacted snow on the ground outside my house. By the time I reached the Aberdeen city part of my constituency, the temperature had reached 6° C and there was no sign of any snow—indeed, the crocuses were up and the daffodils looked as if they were coming out.
However, that area in Aberdeen city is the base from which the cold weather payment calculation for the inland western part of my constituency is determined. As I say, the temperature difference between different parts of my constituency is astonishing.
I make a plea on the issue regularly, but I again want to say something, quite specifically, about the weather stations that determine where cold weather payments are made in my constituency. The two most important stations are at Dyce and Braemar. Anybody who knows Scotland will know that Dyce is 3 miles from the coast and that Braemar holds the record for the lowest recorded temperature in the United Kingdom. However, one part of my constituency, around Alford, receives cold weather payments based on Braemar. Meanwhile, 3 miles up the road in Huntly, which is further inland and further up the hill so that there is more snow and lower temperatures, people have their cold weather payments assessed from the coast at Dyce. That is ridiculous and unjustifiable.
I simply say that the cold weather payments for that part of my constituency—the Huntly area—should be based on temperatures in Braemar, or temperatures somewhere else more appropriate than Dyce, possibly Aviemore. They should certainly not be based on temperatures in Dyce. That is my special plea, and I have to say that it is a very important point. If the Minister ever wished to come to my constituency, I could show him the temperature difference between different parts of my constituency with no difficulty whatever.
Thanks to a lot of pressure from Members in all parts of the House, the Government are in the process of introducing feed-in tariffs. However, I refer to the early-day motion tabled by my hon. Friend the Member for Orkney and Shetland (Mr. Carmichael) on that subject, which I have signed, as have many other Members. Fundamentally, the issue is that those people who have pioneered the use of generating capacity run the risk of being penalised for being involved in that area too early.
I want to press the Minister on the issue, because there is some suggestion that a review is going on to determine whether people who have already installed generating capacity that feeds into the grid should benefit from the new arrangements, rather than being penalised for being pioneers.
For example, I have a constituent who has told me that he installed a solar photovoltaic system in two phases—1.82 kW of capacity in July 2008 and a further 2.56 kW of capacity in July 2009. He has two issues. One is that the equipment he used was subject to microgeneration certification scheme approval guidelines. His concern is that the scheme approves only the most expensive systems. He was able to find cheaper systems that met European standards but not the certification standards, and he thinks that that is inefficient and unfair. Again, I leave the issue with the Minister.
My constituent’s second and more specific point, having made that investment, concerns why on earth he should not benefit from the feed-in arrangements. I know that my constituent would be extremely pleased and grateful if the Minister gave him some encouragement.
May I take the right hon. Gentleman back to UK-wide matters on the cost of energy? I wish to make three brief points. First, does he agree that the hundreds of social tariffs should be simplified and standardised, and that they should be more generous? They are very confusing and do not give everyone access. Secondly, we should end the obscenity of people on pay-as-you-go tariffs, with the poorest in society paying more per unit of energy. Thirdly, we must ensure that people without access to direct debits—again, the poorest in the country—have access to the discounts that are available.
Those are pertinent points, and I am sure that the Minister will take note of them. However, as I said at the outset, there are so many dimensions to the matter that it is impossible to cover them all in one speech—and I am now near the end of mine. Indeed, if I tried to cover all those points, I might get less useful answers from the Minister on the particular issues that I wish to raise.
None the less, the intervention by the hon. Member for Castle Point (Bob Spink) is pertinent. The situation is most confusing. Too many things are going on, and there are too many obligations. People who by definition are poor have to worry how the heck they are to access all those things, including whether they are getting the best deal and who they should ask for advice. Those are questions also for those who are not technically fuel poor, but who wish to improve the energy efficiency of their homes and to use greener energy systems.
I do not know whether other Members have tried this, as I have, but when one seeks information someone will say, “This is who supplies solar, and these people do wind, and these do heat pumps.” People then phone those suppliers, but of course they want to sell them the products that they market. What people really want is access to an objective, impartial energy audit that says, “Your house needs this in the way of insulation and would benefit from that energy mix. Here is a range of the people who can provide you with installation quotes and costs, and they work to approved standards.” If that happened, I suggest that people would then want to know what grants and long-term loans were available.
One scheme that seems to have been successful is the boiler scrappage scheme. Those running it say, “The phone is ringing off the hook with people wanting to replace their boilers and take advantage of the scheme.” I say in passing that it is regrettable that the scheme has not been extended to Scotland. I know that Scotland has the money and may be spending it differently, but I am not trying to make a party political point. However, given the scheme’s success, I suggest that the Scottish Government could usefully consider it.
If so, I am glad to hear it. The latest information that I have is that it is not available, but perhaps it will be, and I would welcome that. It is a simple scheme and it works. Devolution allows the Scottish Administration to do things differently, but I believe that if the scheme works we should use it. That is all I wish to say about the matter.
People also say that we should have smart meters, but smart meters are of value only if they tell people what is going on. They have to be able to record in real time, so that people can make active decisions. We should be clear when talking about smart meters that we need the whole package, not just half of it.
Home energy reports are of rather limited value—almost a gesture. They could be much more rigorously enforced. Indeed, if we are raising standards, the standard of home energy reports should rise with them. People should know their real value and, if they are below value, what should be done. That should be included in the negotiations on buying and selling houses—people should know what they have to do to bring the reports up to standard.
We are in the middle of the deepest recession in living memory. We face the huge challenges of hard-to-treat homes, fuel poverty and the need to develop and introduce greener forms of energy. I can think of nothing that would do more to stimulate employment, investment, economic growth and recovery than a major investment programme in that area. My concern is that the Government have failed to come forward with a comprehensive way to ensure that we deliver the materials and the installation capacity, and the carbon reductions and poverty reductions that should go with them.
I have no doubt that the Minister will refer to yesterday’s announcement. He will not be surprised to hear that, like so many announcements, it is a statement of good intent that sounds attractive, but when will the detail be available and when will anyone be able to use it? If people want to invest in energy efficiency and renewable energy in their home, they will want not only the best advice, but the right financial package to cover the cost of installing it and to give them savings at the same time.
I welcome the principle behind yesterday’s announcement by the Secretary of State, but I shall be much more convinced when I see the colour of his money and we hear details of how people can get hold of the money. I suspect that it will not be this side of the general election.
We are debating an important subject with many dimensions to it, and I am sure that other Members will wish to mention other aspects. I hope the Minister can answer some of the key points that I have raised.
It is a great pleasure to speak under your chairmanship, Mr. Cook. I congratulate my right hon. Friend the Member for Gordon (Malcolm Bruce) on securing this debate, which is on an important topic and is being held at an apposite time.
I agree with all the points that my right hon. Friend made, but I particularly endorse what he said about the effect that the location of the weather stations has on the cold weather payment. I am sure that Members from all parts of the north of Scotland have similar problems with the location of the weather stations; it leads to communities living in certain geographical circumstances that experience very cold weather being disadvantaged when it comes to the allocation of those moneys.
I hope that the Minister takes on board what my right hon. Friend said about the weather station in his constituency, and that he is willing to extend the principle. Perhaps he will don his snowshoes or his skis and tour the north of Scotland, to experience for himself some of the variations in weather that occur in geographically contiguous areas.
It was not in the highlands or in the snow, but I was in Aberdeen last month.
I am delighted to hear that. I hope that the Minister enjoyed his visit. He is welcome to visit the north of Scotland at any time, not least if one purpose of his visit is to consider the issues raised by my right hon. Friend.
This debate is taking place during a long period of severe winter weather. When I arrived home in Aviemore last Thursday, I found my home under 2 feet of snow. When I woke in Friday morning, almost another foot had fallen, which meant that I had to work from home. All the roads were closed and I could not fulfil my constituency engagements. As my right hon. Friend said, with snow on the ground in Aviemore and many other parts of my constituency consistently since 16 or 17 December until now, and probably for several weeks more, such matters are particularly important.
I wish to speak about a particular group of people—those who live in rural and remote areas. As my right hon. Friend said, many use heating oil or liquefied petroleum gas to heat their homes, as they are almost exclusively off the mains gas grid. That has a number of consequences. First, people are more likely to suffer fuel poverty. Secondly, more are likely to suffer extreme fuel poverty. Thirdly, they are more likely to have much higher energy costs, and they tend to live in harder-to-treat homes.
I bring some evidence to the debate. It is based on a survey that I carried out with my right hon. Friend the Member for Ross, Skye and Lochaber (Mr. Kennedy) last autumn. We focused specifically on the rural parts of my constituency and his—Badenoch and Strathspey in my constituency, parts of rural Inverness-shire, Ross-shire, and Skye and Lochaber in my right hon. Friend’s constituency. The evidence demonstrates that fuel poverty is felt more extremely in those parts of the country.
We found that 15 per cent. of people spent more than 10 per cent. of their household income on energy bills. Of those people, 21 per cent. spent more than 20 per cent. of their income on energy bills, which, as my right hon. Friend the Member for Gordon said, is the definition of extreme fuel poverty. For 49 per cent. of those people, the main source of heating was heating oil. Ten per cent. were using LPG, some were using electric heaters and a few were on mains gas. Over the past year, 70 per cent. had seen their bills rise and 43 per cent. had struggled to pay their energy bills. Various points were raised about energy sources. It was interesting to note how few people received help through social tariffs and how few had tried to switch suppliers.
Does the hon. Gentleman agree that a weakness of the CERT—carbon emissions reduction target—scheme is that the lack of transparency means that energy companies do not have much incentive to prioritise groups that are in fuel poverty? Too often, they go for the early easy wins, which are homes that are easier to heat.
I agree with the hon. Gentleman. In many stone-built houses without double glazing, the energy-saving light bulbs that have been sent through the post are piling up, when different sorts of help would make a bigger difference. He is right about the transparency and support in CERT schemes. That is also a problem with social tariffs, which can be hard to understand and to get information on because of the complex systems that vary from company to company. Those things militate against people receiving the help to which they are entitled.
I wish to raise a number of issues with the Minister in relation to hard-to-treat homes where heating oil or LPG is the main energy source. The first point is about regulation. There are obligations on major utility suppliers, such as gas and electricity companies, to engage in schemes such as CERT, to provide support and to offer social tariffs. There is no such regulation of heating oil providers. There is also a major gap in the access and involvement of statutory consumer bodies such as Consumer Focus, which take up and pursue issues.
Does the hon. Gentleman agree that there is great concern within communities about the price of heating oil? When the market price rises, the consumer price immediately goes up. However, when there is a reduction in the market price, the price that people pay for oil to heat their homes is not reduced at the same speed. There is a demand for transparency in that regard.
I am grateful for that intervention, which made one of the points I was intending to make. That trend applies not just to the oil sector, but to gas and electricity. Companies are quick to increase the price but not as quick to pass on reductions. Certainly in my constituency and across the north of Scotland, small providers in the heating oil sector do their best to pass price reductions from the major oil companies on to their customers as quickly as they can. The lack of will is not with the local providers, but with the major oil companies from which they receive their supply.
Does the hon. Gentleman agree that one difficulty with the pricing of fuel, including gas, is that it is traded at least four or five times through commodity dealing before it reaches the shores of the United Kingdom, whether in Scotland, Northern Ireland or elsewhere?
On this important point, does the hon. Gentleman agree that the situation is even worse than has been stated because many energy companies forward-buy their oil or gas at a fixed rate? Therefore, when prices rise, they do not necessarily go up for the companies straight away; often it takes up to six months. However, they are quick to increase prices for the consumer. The regulators need to take more firm action to make this matter transparent and to stop it.
I am grateful for that intervention. I am sure that the Minister heard the point and will respond.
Some smaller heating oil companies in my constituency endeavour to help people struggling with their bills, for example by allowing them to spread payments regularly over weeks or months so that they do not have to pay huge lumps of cash up front when the oil tank has to be filled up every couple of months. My constituents have had to fill their oil tanks more frequently over the past two or three months because of the severity of the winter conditions. After Christmas, the road conditions made it difficult for oil companies to get oil to people’s homes and there was a serious risk of shortages. I am grateful to the Government for acting to lift some of the working-hours regulations to address that issue. Many companies would like explicitly to provide social tariffs in this sector to people in the most difficult financial circumstances, but are unable to do so because of their relationships with large oil companies and the lack of regulation.
My second point about such households concerns access to home insulation and other energy efficiency measures, to which my right hon. Friend the Member for Gordon rightly devoted a large portion of his speech. As such help is delivered partly through electricity and gas companies, those who have an unregulated oil provider have less access to such help to improve their homes.
I have investigated the systems that have been put in place in Scotland, such as energy helplines. Although in theory there are measures available to help people in older homes that use heating oil, in practice they are hard to get. One organisation I talked to could give only one example of someone having an air-source heat pump installed as an alternative to oil, but could give hundreds of examples of people who had received a bit of loft insulation. I am not decrying the importance of loft insulation, but the people I am describing tend to need more expensive measures that are just as necessary, if not more necessary, because of the circumstances in which they live.
The hon. Gentleman is touching on an important point. In parts of the UK, particularly Northern Ireland, advantageous schemes are unveiled by devolved Ministers. Sometimes, as advantageous as the schemes are, the people who could benefit most from them, namely the lower socio-economic groups, are unaware of the advantages. Unless such schemes are promoted more vigorously, the people who are supposed to benefit are also the ones who are least likely to avail themselves of them.
I would state the point in a different way: many of the schemes sound good, but are difficult to access for the people who need them most, who are often those living in older homes, for whom the schemes would be more expensive. They are difficult to access partly because of the information and the lack of awareness of what is available, but partly because the way in which the schemes are administered often means that the priorities are more to do with volume than with helping the people with the greatest need. I would like the Minister to address that issue.
My hon. Friend will have been to many presentations in this House by energy companies, where they offer all kinds of new technology but point out that the costs are disproportionately high. Does he agree that if the Government got their act together and put all of the schemes together, the market would be unlocked and a whole new industry created, which would reduce costs and benefit everybody, whether poor or better-off?
I am sure that my right hon. Friend is right. An extension of the principle behind the boiler scrappage scheme to other technologies over a fixed period would provide an incentive, which would encourage industries to flourish and the training of technicians. That would make a big difference to the availability of such support.
Before I move on to another issue, I should say that I would be interested to hear the Minister update hon. Members on the status of the renewable heat incentive. I have big concerns about a scheme that is based on adding to the costs faced by those people who already have the highest costs—people who use oil, gas and coal—to fund improvements that are necessary to reduce those costs. The financial burden of those sorts of improvements should not fall most heavily on people who are already facing the highest costs. The Government were consulting on and considering that issue, so I would be grateful for a status update and an assurance that the Government do not intend to place extra financial burdens on users of heating oil and LPG, whatever the environmental merits of the schemes that will be paid for.
I also want to ask the Minister one or two questions on another form of fuel that can help to deal with such issues and provide an alternative to healing oil: wood fuel. Wood fuel is renewable, available and, very often, local. For example, in a housing development where I live in Aviemore, a district heating scheme warms 100 homes and is fuelled by a wood fuel boiler that uses wood material sourced from the sawmill 7 miles down the road. That has reduced costs, had significant environmental benefits and is an example of the sort of thing that could be done more often with wood fuel.
A very good European co-operation programme is going on between people in Scotland and other European countries. It has been set up by an organisation called Highland Birchwoods, which is considering how the use of wood fuel can be encouraged and how wood fuel boilers on a domestic scale can be pushed forward.
I would be grateful for the Minister’s help on the issue of the VAT regime on wood fuel. Hon. Members will know that VAT on fuel is charged at 5 per cent. As wood has a wide variety of uses, however, suppliers of wood fuel face a VAT charge of 17.5 per cent. at wholesale level. The Government provide very little information proactively to suppliers of wood specifically for fuel uses—whether to providers of pellets wood chip, or anyone else who might be taking wood on a wholesale basis and converting it into wood used specifically for fuel—about how to reclaim the VAT difference.
In my constituency, for example, log suppliers have in good faith understood that they were required to charge VAT at 17.5 per cent. on logs when, in fact, they should have charged 5 per cent., which would have made a big difference to relative costs, principally to the consumer. Government should try to make clear the VAT rates on wood fuel and ensure that information about how to reclaim the difference is made easily available to small suppliers. That would make a big difference to promoting wood fuel.
More skilled technicians who can install wood fuel boilers as part of a domestic or district heating scheme are also needed. I commend to the Minister the work being done at Inverness college in my constituency to train up such technicians. As the technology becomes available and is more widely promoted, and the supply chain for domestic wood fuel builds up, it is important to ensure that there is a network of people who can install the technology.
I shall end on the same point with which my right hon. Friend the Member for Gordon concluded. We are just coming out of the depths of the worst recession that this country has experienced for 60 years, and there is a significant need to create jobs. We have the opportunity to move the economy in a more environmentally sustainable direction. However, we need to ensure that any changes operate on the basis of the overriding principle of fairness that I certainly believe in and that is so well established in this country.
An effort to enhance support for measures to tackle fuel poverty—particularly home energy efficiency and home insulation—and to bring people in remote and rural areas who use much more heating oil and LPG within the reach of those measures, would have a dramatic impact on jobs, on the financial burdens on families who are struggling to make ends meet, and on ensuring that our society is fairer. For all those reasons, I urge the Minister to take any steps that he can to ensure that people in remote and rural areas who rely on off-gas-grid heating sources are given a much higher priority than they receive currently in the Government’s thinking.
I apologise, Mr. Cook, for your not being informed that there was a change in the Liberal Democrat spokesperson for today’s debate. I congratulate my right hon. Friend the Member for Gordon (Malcolm Bruce) on initiating the debate at this most opportune time and on raising a number of issues that affect my constituency and that of our hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) as much as they affect his.
The problem affects not only rural and remote areas, but urban areas. Indeed, the difficulty of dealing with energy inefficient homes is particularly acute in the private rented sector, where the cost of improving the efficiency of a home falls on the landlord, but the benefits accrue to the tenant and to the country as a whole through the reduction in carbon emissions. Particularly in houses in multiple occupation, the incentive to invest and contribute capital is sometimes not supported as well as it could be by the current systems.
First, I shall discuss families in fuel poverty and their difficulty in budgeting for fuel costs. Such families are faced not only with variability in the weather—we have just experienced one of the coldest winters for many years, when people needed to use more energy and to produce more heat—but with the incredible volatility of energy prices. As a consequence, it is very difficult for them to budget for their energy needs. People in fuel poverty spend more than 10 per cent.—or, if they are in extreme fuel poverty, more than 20 per cent.—of their income on fuel. Fuel takes up so much of their income that any changes in that amount have a disproportionate effect on the money that they can spend on other things.
The Government have a duty to consider that matter in some way. I know that the Minister cannot influence the weather, although he may wish to do so in the future if he ever gets the opportunity again, but providing some stability in energy prices so that people can budget much better would be to their advantage and would reduce the impact of fuel poverty. There are ways in which that can be done, for example, social tariffs, to which I may return, but first I shall pick up some of the points that my right hon. Friend the Member for Gordon made, particularly about hard-to-treat homes.
The people who live in such homes often suffer from a triple whammy because their homes are not only an older type of property, with solid walls and other types of construction that make it difficult to improve efficiency, but they are off the gas mains. The people who live in such homes suffer many accumulated problems of fuel poverty. An issue that perhaps has not been discussed very often is listed buildings. Double glazing was raised in another context, I think, but it is often not allowed in listed buildings because of the planning process, so one form of fuel efficiency is often ruled out for such buildings. However, many innovative builders and carpenters are designing double-glazed windows that reflect the architectural traditions of listed buildings and could be used, so perhaps the Minister could intervene with his colleagues in the Department for Communities and Local Government to see whether something could be done along those lines.
My right hon. Friend mentioned external and internal cladding, but one can imagine the planning difficulties that would be incurred if people set about altering the appearance of listed buildings. That is one problem that has not been addressed to any extent. I live in a listed building—perhaps I should have declared an interest—and recently had to apply for planning permission to install solar panels. Although that process has been eased recently, it certainly was not an encouragement to involving myself in that type of improvement.
Households that are off mains gas can experience problems. Households in my constituency use not only oil, LPG and wood, but coal, because many of my constituents live in old mining communities and for a long time benefitted from free coal because they worked in the coal industry. Not many of those families still benefit from that, but the widows of former coal miners still have coal delivered on the street outside their house and have to get their sons or nephews to cart it round the back so that it can be used. There is a range of fuels, but all are much more expensive than mains gas. Indeed, in a little village in my constituency, Garth, I came across a group of elderly people living in local authority accommodation who had decided to switch off their LPG supply because its sheer cost made it impossible for them to heat their homes. The homes were poorly insulated and they were putting their health and lives at risk as a result.
What can be done? My right hon. Friend mentioned extending the gas mains, which really would be a long-term solution for fuel poverty for so many people. However, as the hon. Member for Stroud (Mr. Drew) pointed out, the cost to individuals of having the gas mains extended is often beyond their means, and the investment would probably not produce a return in their lifetime, or even that of their children if they live in the same home after them. Will the Government consider either encouraging or subsidising gas companies to achieve a greater reach for gas mains? As I said, that would be a long-term solution to the problem.
I thank the Minister for that comment, which indicates that the Government recognise the value to the fuel-poor of being on mains gas.
I would like to refer briefly to a concern about LPG supply that I raised with the Minister during Energy and Climate Change questions. Following my predecessor’s work on competitiveness in the LPG industry and pressure I put on the Office of Fair Trading, it conducted an investigation into the competitiveness of the LPG market and found several practices that made it difficult for families to change their supplier because of the need to change the bulk tank and other fittings associated with the supply. Regulations have now been brought in that ensure that customers can now shop around between suppliers and get much better deals.
The community in another village in my constituency, Llanspyddid, were able to get together and reduce their energy costs substantially by getting competitive quotes from different companies. My concern is that that is available to those in the know. One thing that the Department of Energy and Climate Change could do is publicise the fact that people can shop around for their LPG supply. I do not think that the companies are proactively competing against one other by advertising better prices, and certainly any improvement arises only when the customers are proactive. Any raising of awareness or advertising of the possibility of changing supplier will make a real difference to people on LPG supplies.
My right hon. Friend the Member for Gordon and my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey both referred to cold weather payments, and we certainly all have our stories about those. The weather station that serves the Ystradgynlais area is situated in Swansea, which makes it sound as though it is by the seashore. Certain parts of the Swansea valley area are by the sea, but parts of it are back up in the mountains in mid-Wales—Coelbren, for example, is about 1,500 feet above sea level and is very exposed. Cold weather payments are not triggered for those living there because the weather in Swansea is more benign and tropical.
We have been campaigning to have the weather station moved to Sunnybridge, which is often on the weather map as the coldest place in the UK. That would be much more beneficial in our area. I was talking to a Gurkha the other day who said he had trained in the Arctic, which was cold but dry, in the jungle, which was wet but warm, and in Sunnybridge, which was cold and wet, he needed a high degree of personal organisation to survive. I recommend it as the site for the weather station that should be consulted in those matters.
I will finish my remarks by referring to social tariffs and the ability to switch between suppliers. I remember participating in a debate in this Chamber on a similar topic, during which we discussed the ability to switch supplier. Of the several Members present in that debate—more than are present today—my hon. Friend the Member for Twickenham (Dr. Cable) and I were the only ones who had not switched, and we concluded that it was an age thing, as we were brought up in a time when we received energy supplied by a nationalised company and did not shop around among other companies. It would be interesting to know which people do and do not switch by age band, and which of those people have access to IT equipment, which makes switching much easier. I am sure that we have all heard horror stories from constituents who have attempted to switch and then found that they were billed by two companies at the same time. All those deterrents make people cautious about whether they would benefit from switching.
Social tariffs are very complex. I looked recently at a few quotations from companies, and they have different standing charges and different prices for the first 100 units and for the rest of the units, so it is difficult to put those details together and know whether a particular tariff would benefit the consumer. If there were some standardisation of the quotes for tariffs, that would make the process much easier, and people would be able to switch with much more confidence and receive greater benefit.
On social tariffs, and further to the point made by the hon. Member for Castle Point (Bob Spink), who is no longer in his place, I have figures for an average household consumption of 4,200 kW of electricity per year. Paying by standard credit, that would cost £977; by direct debit, £902; but by prepayment, £1,049. The people who use prepayment tend to be the most vulnerable: they have more difficulty budgeting for their fuel costs, yet are penalised the most.
The sharing of data between the Department for Work and Pensions and the electricity companies on those who should qualify for social tariffs would be beneficial. There has been some talk of smart meters, and I am advised that there are super-smart meters that automatically change the supply to the most advantageous supplier for the customer’s circumstances.
This is a subject that we all have experience of in our own lives, but our most vulnerable constituents have the most difficult experiences. I have read the Government’s proposals for green loans, as well as the Conservatives’ proposals. They have many good ideas, but we need to implement them and prioritise them, so that the most vulnerable and needy in our communities—the ones who suffer from ill health and are at risk of premature death—get the greatest help.
I congratulate the right hon. Member for Gordon (Malcolm Bruce) on securing the debate. He has an excellent track record and is widely respected in the House for his knowledge of the subject and the wider agenda. This has been an excellent debate, albeit the contributions have come from one party and from outside England; nevertheless, some sensible ideas and analysis have been offered by the right hon. Gentleman and the hon. Members for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) and for Brecon and Radnorshire (Mr. Williams).
As well as the points about heating oil and the difficulties of the most vulnerable, and some excellent comments on the potential of wood fuel, with which I thoroughly concur, the right hon. Gentleman’s opening remarks were absolutely spot-on. He said that, sadly, after 13 years of Labour Government, it is groundhog day on fuel poverty. In absolute terms, we are back to where we came in, despite the money that has been spent and the progress that we thought had been made. It is depressing that we are back at the bottom of the tall mountain that we have to climb to overcome fuel poverty.
Simply business as usual is not an option if we really want to crack the problem and make progress on a far greater scale and to a far more ambitious timetable. That is why my party proposes a completely new and radical approach to fuel efficiency. The measures to date have not been up to the scale of the task, not for lack of good will on the part of the Government, nor for a lack of interest in the agenda, but simply because their policies have not been up to it. I am therefore grateful to the right hon. Gentleman for providing an opportunity to set out in a little more detail how we would tackle the twin challenges of carbon emissions and fuel poverty that domestic energy efficiency throws up.
As Members know, carbon emissions from the UK’s housing stock are some of the worst in Europe. Without urgent action to reduce emissions, we will struggle to stay on track to satisfy the targets implicit in the Climate Change Act 2008 and the recommended emissions reduction trajectory laid out by the Committee on Climate Change. Moreover, fuel poverty is a ballooning social justice crisis throughout the UK. The average gas bill has increased by 169 per cent. since 2003 and the average electricity bill has nearly doubled. Ofgem predicts that energy bills will rise by another 60 per cent. by 2015 and, with 40,000 people pushed into fuel poverty by every percentage point rise in fuel costs, it is clear in the statistics that we have a serious problem indeed.
It is also clear that there has been systematic failure in this Government’s efforts to tackle the problem with the policy toolkit that they have had available. As right hon. and hon. Members have said, there have been too many schemes. They have often been well meaning in themselves, but the sum total of the parts is not a coherent and ambitious whole. There have been too many stop-go initiatives, too much talking and not enough action.
The Government had promised that, at the turn of 2010, no vulnerable household would be left in fuel poverty, yet current estimates suggest that nearly one fifth of UK households were still spending more than 10 per cent. of their income on energy—the key definition of fuel poverty—at the same time that British Gas announced a surge in profits. The Government have relied for too long on falling wholesale energy prices to reduce fuel poverty and have not taken any real, concrete steps to tackle the challenge on a much larger scale. The average fuel bill is now a shocking £1,300 per year, yet competition in the sector is a fraction of what it was when the industry was privatised, nearly 20 years ago.
For off-grid gas customers, the problem is particularly acute, as has been mentioned. Heating oil and electric heaters compare poorly with even fairly old gas heaters in terms of value for money, and off-grid properties tend to be less efficient and harder to insulate as they are often older, single-skinned rural buildings, or, in the case of my constituency, static homes. There is an urgent need to address energy consumption in those often vulnerable households.
Rising bills have been compounded by other Government failures. The value of the winter fuel payment has decreased in real terms. When instigated, it covered one third of the average bill; now, it barely covers one fifth. In addition, the Government have slashed the budget for their Warm Front programme. Whatever concerns we may have about the programme’s effectiveness, the bottom line is that the budget reduction from £1 billion to £810 million this year will lead to 50,000 fewer vulnerable households receiving assistance from that programme this year.
Yes, but, as I understand it, the money announced in the pre-Budget report was exactly that—it will not do anything to help vulnerable people this winter. To put the figures into context, the Treasury collected £9 billion of VAT receipts from UK utilities and £1.2 billion from domestic fuel customers last year.
Rising bills have been fuelled by the Government’s lack of a credible energy policy. Allowing utilities to sweat assets and the failure to bring a greater strategic focus to infrastructure renewal have left the UK a net importer of gas with a looming energy crunch. That, combined with only 14 days’ gas storage, leaves the UK vulnerable to spikes on the spot market, gives utilities a fig leaf for raising electricity bills, and is a particular threat to off-grid consumers.
The solution to many of those challenges is simple, straightforward and pays for itself: greater energy efficiency. In the home, that means energy saving and insulation. Some 33 per cent. of the heat lost from an uninsulated house is lost through the walls. One could save around £90 on energy each year in an average home by insulating wall cavities alone. That would save about £720 million of energy a year, or 9 million tonnes of carbon—enough to power 1.8 million homes for the same period.
Despite the clear economic and social advantages of increasing energy efficiency at scale, we are not moving at the scale and pace that is needed. That is why, a year ago, the leader of my party announced an energy refit programme, the Conservatives’ green deal, that would establish a new model with a far greater sense of ambition for delivering energy efficiency throughout the UK—a new way of tackling this embedded social and economic problem. Under the Conservatives’ approach, households would get instant access to measures to make energy efficiency improvements, the cost of which would be paid back, not by the householder, but by the owner of the property who pays the electricity bill over 20 years through a surcharge on bills, just as transmission charges, for example, are currently levied on an electricity bill. That would guarantee immediate savings, so homeowners would see not only an improvement in their quality of life, but an immediate saving. With a street-by-street roll-out in partnership with local authorities and by targeting vulnerable households, that policy will also bring together the dual priorities of reducing fuel poverty and reducing carbon emissions, but on a far more meaningful time scale than has been achieved by the Government over the past 13 years.
When we first set out the principle of our energy efficiency measures, they were then routinely rubbished by Labour Ministers. The Secretary of State for Energy and Climate Change dismissed as a
“a bad combination of…reheated and…uncosted”
policies. They pooh-poohed the figure of £6,500, saying that it could not be afforded, yet the beauty of our scheme is that there would be no overall charge to public funds. The scheme will be privately financed by banks and investment funds; I have met many of their representatives and they are keen to enter this new, exciting market. But one year on, it is no surprise that the Government have realised that they simply cannot go forward with their own policies and have produced, I am glad to see, something that is remarkably similar to the Conservatives’ programme, with a few tweaks at the edges. Imitation is the sincerest form of flattery, but it is disappointing that it has taken the Government 13 years to do that. Now in their death throes, in their last weeks in Government, they have finally had to admit that their policy has not worked and they need to come up with something else. However, that is welcome in so far as it means that, in the new Parliament, there will be much greater consensus on the way forward on tackling this urgent problem.
I am concerned that the Government have not really had a genuine change of heart and that this is just a political ruse. Their policy is undermined by its being twinned with renewable energy and renewable energy feed-in tariffs. Burrowing into the Government’s statistics, their own anticipated forecast and target is that by 2020 only 1.6 per cent. of our energy will come from decentralised energy sources supported by feed-in tariffs. If that fact is married to the “Warmer Homes, Greener Homes” strategy, that is a pathetically unambitious and impoverished figure that shows that that is not a genuine adoption of the agenda but is merely a political manoeuvre to try to parry a radical proposal from the Conservatives. I am sorry that the Government are not really, in their heart of hearts, keen to embrace this agenda, but I welcome any moves towards it.
I want to give the Minister time to reply to the many points that have been raised, but in so far as we see any consensus in the Chamber today, there is consensus on business as usual not being good enough. We are not making the progress that we need to make. We need fresh ideas, new thinking and a far more ambitious time scale on implementation. We need to embrace new technologies as well as new financing models. I look forward to hearing what the Minister has to say. Ultimately, the only way that we are going to get to grips with this agenda to do justice to the fuel-poor as well as to our carbon transformation is to sweep away this tired, end-of-life Government.
I congratulate the right hon. Member for Gordon (Malcolm Bruce) on securing an important debate on a important subject, and on his thoughtful, constructive approach to it, which was in stark contrast to that of the previous speaker, who turned it into a party political argument.
In respect of the point made by the right hon. Member for Gordon partway through his speech—that real people really die in the cold of winter if we do not get this right—eradicating fuel poverty is an important challenge to Government. That is my responsibility in this Government and I take it seriously.
I prepared what I think is a brilliant speech to respond to the debate, but I did so before I heard hon. and right hon. Members speak. It would be a much more constructive use of my time, certainly to begin with, to try to answer the points that were raised, so that is what I intend to do.
The right hon. Gentleman mentioned the trend in fuel poverty. Back in 1996, 6.5 million households were in fuel poverty. By 2003, partly because of benign global prices, partly because of the system of regulation of energy companies and partly because of the first successes of some schemes that I may have time to mention later, that figure decreased to 1.5 million, which is a huge change. Then came four years of incredibly high price rises. The hon. Member for Bexhill and Battle (Gregory Barker) mentioned that huge growth in prices in quite a short time. However, no hon. or right hon. Member has said that there was something that the British Government could do about worldwide oil prices and their knock-on effects on energy prices around the world, but clearly that blew us off course in eradicating fuel poverty in this country.
The result of all that is that the 2007 figures—frustratingly, for me, those are the latest official statistics—based on all the information having been collected and assessed, show that 4 million households in the United Kingdom are in fuel poverty. Doubtless, prices continued to rise after 2007 and, although there was a fall-off more recently, which I might mention in a while, the figure is probably higher, not lower, as we speak. I take seriously my responsibility for trying to get that figure down again, rather than have it go up, despite what happens to global prices.
I acknowledge what the right hon. Gentleman said at the outset about certain properties. My hon. Friend the Member for Stroud (Mr. Drew) also mentioned what happens when we have taken all the quick wins and insulated all the lofts and cavity walls. That has been done to great effect over the past 12 years—perhaps I will be able to provide some statistics later—and by 2015 we aim to insulate every loft and cavity wall that can be filled, provided that the owners and occupiers of properties permit the work to be done.
When all those easy wins have been achieved, we are left with the harder-to-treat properties, many of which, as the right hon. Member for Gordon said, have solid walls with no cavity. It is incumbent on us to find the solutions to deliver sufficient energy efficiency measures to those properties to bring them up to a good standard of energy efficiency.
In the past, as the right hon. Gentleman said, the answer has been a fairly cumbersome system, usually external wall cladding, which sometimes, although I should stress not always, leaves quite a visual impression on a property that most people do not like. Developers have been working hard on modern forms of external cladding that are much easier on the eye and, crucially, on clever technologies and innovations in technology for internal-wall cavities that can be created with a modest loss of space inside the property, which is key to consumer acceptance of the technology. I do not know whether the right hon. Gentleman has visited BRE’s research centre at Watford, as I have, and seen some of the work that is going on to develop such technologies, but that work is in hand.
The right hon. Gentleman mentioned the Government’s strategy that was launched yesterday. When I say “HEM” from now on, that stands for the household energy management strategy. He is right to ask for all the details of that strategy and when it will take effect. The point about the strategy—given sufficient time, I will mention the works that we are doing up to 2012—is that it is our view of what happens from 2012 to 2020 to improve properties, especially those that have so far been regarded as hard to treat.
The right hon. Gentleman asked about local authorities working independently and not being co-ordinated or given the tools to do the job. HEM gives local authorities a central role in co-ordinating our activities to tackle fuel poverty and make properties more energy efficient. He referred to a woman who said that what she really needed was accurate advice from someone. HEM provides the solution of a new cadre of certified and well-trained advisers who can provide independent advice on all the options.
In the meantime, I do not want to diminish in any way the excellent advice given by the Energy Saving Trust, which is funded by my Department and provides a national system of call centres to provide advice. On the internet, through our branded website, actonco2, people have access to accurate and independent advice from the Energy Saving Trust.
The right hon. Gentleman asked about watching out for cowboys, whether installers or those who offer products, and it was suggested that there should be a reliable system of certification. In the HEM strategy, we discuss how we intend to provide a reliable system of certification. I hope that he can see how the strategy in each area will be valuable, although I acknowledge that, as he said, it will come into effect in coming years and is not in effect today.
The right hon. Gentleman made an important sally on the significant issue of properties that are off the mains gas grid, most but not all of which are in rural locations. I shall start with his request for statistics. He said that 1 million properties in Scotland are off the gas grid. If so, my figures are not sufficiently accurate, so I must be careful. According to my statistics, in 2007 in Scotland, 278,000 properties were off the mains gas grid, which is 12 per cent. of the total. In the same year in England, 2.6 million were off the grid, representing 13 per cent. of the whole. In Wales, 230,000 were off the grid, which is 19 per cent. of the total.
The picture in Northern Ireland is very different. There is effectively no mains gas grid, and 621,000 properties are off the grid, which is 88 per cent. of the total. I hope that those statistics are helpful in showing the scale.
The right hon. Gentleman asked what we are doing to help people who are off the mains gas grid to keep the cost of keeping their homes adequately warm at a reasonable level. I mentioned the drive by the regulator, Ofgem, to incentivise the energy companies to extend the mains grid to 20,000 more households that are in fuel poverty during the current five-year price control round. That is one measure.
Under schemes such as CERT—the carbon emissions reduction target, which is the obligation on energy companies to deliver energy efficiency measures—there is no reason why properties off the mains gas grid should not be helped, but I take to heart the point made by the right hon. Gentleman that the Government should direct energy companies to do more work in such areas, because, as my hon. Friend the Member for Stroud said, they too, driven by volume targets for reducing carbon dioxide emissions, have taken the easy wins, which are often in concentrated areas such as urban areas. Perhaps they have not given the necessary attention to that in the past. Under HEM, as we continue the obligation on energy companies, we intend to take more power to give directions on the sort of work that we want done.
As an example of how we are already flexing our muscles, we recently consulted on extending CERT from 2011 to the end of 2012. In the consultation, we asked for people’s views on directing the energy companies to do more of their work as energy efficiency measures—no more free light bulbs posted to people’s homes—and to aim more of its work at a super-priority group, which we intend to define as those most in danger of being in fuel poverty to have more work done to their properties under CERT. That is an example of the more activist approach that the right hon. Gentleman urges on me.
Very recently, in September, we launched CESP, the community energy saving programme, which is the next step on from CERT and our publicly funded programme, Warm Front. Under CESP, we ask energy companies, local authorities and community groups to form local partnerships and go house by house, street by street, to improve the energy efficiency of every property, whether hard to treat or not. CESP has been a good forerunner of what we expect the landscape across all those schemes to look like post-2012.
Two of the first schemes announced by British Gas were in Glasgow and Dundee in Scotland, but they are urbanised areas. My ambition, as a Minister with a keen interest in rural communities, is to see some CESPs formed in rural areas. There is no reason why they should not be, if energy companies and local authorities form partnerships in such parts of the country.
I urge right hon. and hon. Members who have taken part in the debate to go back to their local authorities and to use their contacts with energy companies to ask why there is no CESP in their area. That is another example of what we can do for such areas.
The feed-in tariffs that will start in April are an incentive for people in rural areas to consider microgeneration as a source of energy, and now as a source of income as well. In 2011, there will be a renewable heat incentive, which will be hugely significant, especially in rural areas and for people off the mains gas grid to take their energy from renewable sources of heat, and to receive a reward from the Government for doing so. That is a strong message to people, as is that about microgeneration.
The right hon. Gentleman asked what efforts are being made to promote microgeneration. This Government had the first ever microgeneration strategy in 2006. We are renewing and refreshing it to deliver an up-to-date microgeneration strategy. There is a certification scheme for the goods and services under microgeneration, and grants are available for people under the low-carbon buildings programme to fit some forms of microgeneration to their properties. There are already encouragements for microgeneration.
First, will the Minister answer my question about the range of products available under the microgeneration certification scheme? My point was that they are more expensive. Secondly, will there be some sort of retrospective allowance for people who have already invested in microgeneration to benefit from feed-in tariffs?
I will deal with those points. On the range of products, when we go from no certification to certification—there is already a certification scheme for microgeneration—it takes time to build up sufficient products and sufficient people with the skills to carry out the installations, but we are determined to drive that forward. On a different point, the right hon. Gentleman said how important it is that there are certification schemes to avoid the cowboy scenario. We need to do the work, and I am keen to do so.
I had not quite finished explaining what we want to do to help people who are off the grid. The social price support, about which several Members spoke approvingly, means that there would be money off the bills of fuel-poor households for their electricity. Generally speaking, people have an electricity supply wherever they live, so off-mains gas grid customers will have the benefit of social price support if they are in danger of fuel poverty.
For those who must pay for heating oil or liquefied petroleum gas and have difficulty with the up-front cost of bulk buying, National Energy Action is carrying out work at the request of the Department of Energy and Climate Change to see whether there are ways—for example, through credit unions—to help people with up-front costs. That could be a significant development.
On feed-in tariffs, our judgment is that people who decided to fit renewable energy sources before we announced the scheme based their decision on the scene as it was at the time. They may have received a grant from the low-carbon buildings programme, but they did their own calculation, so we do not feel too guilty about the fact that the system is to drive more investment in future, not to reach back to reward those who based their judgment on the situation at that time.
The right hon. Gentleman also asked about the location of weather stations and cold weather payments. The Department for Work and Pensions reviews the locations every year and takes into account the representations made by hon. Members and the public. I remember statements by that Department of changes that it had made in response to representations. I urge right hon. and hon. Members to make their representations.
I have so much more to say just in reply to right hon. and hon. Members’ questions, but on the issue of confusion, no one has mentioned Consumer Focus, the consumers’ champion. I am keen to support it so that everyone talks about its role—its help is very significant.