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Energy Bill [Lords]

Volume 532: debated on Wednesday 14 September 2011

Consideration of Bill, as amended in the Public Bill Committee

New Clause 10

Green deal installation apprenticeships

‘(1) Before making the first framework regulations the Secretary of State must lay before Parliament a report on what, if any, steps the Secretary of State has taken to encourage green deal installation apprenticeships.

(2) A “green deal installation apprenticeship” is an apprenticeship which provides training on how to install energy efficiency improvements at properties.’.—(Gregory Barker.)

Brought up, and read the First time.

With this it will be convenient to discuss the following: new clause 8—Support from the Green Investment Bank

‘(1) The Secretary of State must, within six months of this Act receiving Royal Assent, report to Parliament with proposals on the ways in which the Green Investment Bank could maximise the take up of the Green Deal.

(2) The report required by section (1) shall include an examination of the extent to which action taken by the Green Investment Bank could—

(a) reduce interest rates linked to the repayment of Green Deal loans and the impact this may have on consumer demand;

(b) support the research into and development of technologies which could increase household energy efficiency.’.

Government amendment 29.

Amendment 26, in clause 3, page 4, line 29, at end insert—

‘(j) Prohibiting the sale of products and services during Green Deal assessment and installation visits which are not eligible for Green Deal financing unless those products are recognised as being able to reduce household CO2emissions.’.

Government amendment 30.

Amendment 49, page 5, line 2, leave out ‘may’ and insert ‘will’.

Amendment 28, in clause 4, page 6, line 16, at end insert—

‘(9A) The ninth condition is that the green deal provider meets any requirement specified in the framework regulations as to the level of interest charged on the plan’.

Amendment 50, page 6, line 16, at end insert—

‘(9A) The ninth condition is that the green deal provider meets any requirement specified in the framework regulations to enable the consumer to compare recommendations and estimated costs and savings.’.

Amendment 27, in clause 5, page 6, line 34, at end add—

‘(e) a term permitting the improver to specify whether the instalments will be paid via his electricity bill or his gas bill;

(f) a term permitting the improver to change his decision taken pursuant to paragraph (e).’.

Government amendments 31 to 34.

Amendment 45, in clause 18, page 15, line 4, after ‘may’, insert ‘and may not’.

Government amendment 36.

It is a pleasure to be back in the House to debate this historic Energy Bill one last time before it moves back for the last time to the other place. To better inform the debate on the amendments before us, I shall update the House briefly on the progress made over the summer on a number of issues that were raised in Committee.

We had a lively discussion on measures eligible for green deal finance. That was led by the hon. Member for Ogmore (Huw Irranca-Davies), who championed the power shower. I committed to an early refresh of the Government paper to take into account queries about our position on water efficiency and recommendation of measures outside the green deal. That has been done. After our exploration in Committee of the detail of the energy company obligation—an important part of the Bill—I agreed that my officials would meet the hon. Member for Southampton, Test (Dr Whitehead) to discuss our brokerage proposal. That has been done.

The private rented sector was another important subject of debate—fruitful debate, I hope—with contributions from the hon. Member for Wells (Tessa Munt), among others. I shall say more about that later. My officials are setting up a new workshop to look specifically at how the provisions can best work with older buildings, which present a challenge to the green deal, particularly older historic buildings.

Lastly, I am pleased to report progress on energy efficiency for service family accommodation, following the excellent suggestion of my hon. Friend the Member for Richmond Park (Zac Goldsmith). My officials have had a number of meetings with their counterparts in the Ministry of Defence and, having agreed the shared objective of improving the energy efficiency of accommodation, are investigating the best ways to achieve that. As I mentioned in Committee, it is a complex problem owing to the unique nature of service family accommodation. None the less, I am optimistic that a solution will be found to satisfy the House and, most importantly, service families.

We have a large group of amendments, not all of which were tabled by the Government. I propose to speak to the Government amendments in my opening remarks and address the other amendments in my closing remarks, rather than pre-empt them before the Members who tabled them have spoken. That should make for a more orderly debate. There is nothing more annoying than having one’s arguments addressed before one has even had a chance to make them to the House.

The Government amendments are largely technical. Government amendments 31 to 34 cover disclosure. They enable the Secretary of State, if necessary, to require a green deal provider to produce a further document containing information about the green deal plan as part of the confirmation process. This would be in addition to the energy performance certificate. Both documents would then have to be disclosed to future bill payers. These amendments therefore enable the Secretary of State to require, if necessary, additional information about the green deal plan to be given to future bill payers as part of the disclosure process. This small amendment responds to the concerns of stakeholders and the concerns that were expressed in Committee about consumer protection, particularly in the rented sector. We have moved to tighten that up.

On the transfer of payments, Government amendment 29 is a technical amendment that makes it clear on the face of the Bill that when collecting payments, energy companies are acting in an agent and trustee capacity for the green deal provider, which, in many cases, will not be the energy company itself. This is in line with the policy that I set out in Committee. Liability for green deal payments should sit on the balance sheet not of the energy companies, but of the green deal provider.

Without this clarification, there is a risk that payments received would be the property of the energy company until they were remitted to the green deal provider, which might enable an administrator to claim green deal payments in the event of energy company insolvency. Through the amendment we can minimise this risk and, as with all risk minimisation in this process, help to push down the cost of green deal finance.

On assessment and installation, I shall deal with a number of Government amendments relating to the role of professionals operating under the green deal, and consider them with amendment 26, tabled by the hon. Member for Brighton, Pavilion (Caroline Lucas). Amendment 26 and Government amendment 30 relate to the role of professionals and the importance of protecting customers, while allowing the green deal to thrive. I apologise for breaking the rule that I said I would abide by in my opening comments, but this makes more sense, so I hope the hon. Lady will forgive me. I am grateful to her for raising the issue of cross-selling.

It is important to consider how and when green deals are likely to take place. Many will come about as a result of other activities, such as the installation of a new kitchen or boiler in a home. We do not wish to limit these trigger points. They will often be important opportunities to promote the green deal alongside other renovations or improvements that are happening in the home, which the householder may not have considered ahead of planning for a new bathroom, kitchen or other improvement.

Our market research has shown that customers would welcome and are therefore more likely to trust the involvement of local authorities, community groups and third sector organisations when thinking about entering into a green deal. This was a recurring theme in Committee, when we all agreed that the involvement of local authorities and community groups was vital to ensure the successful large-scale roll-out of the green deal. Such organisations may see participation in the green deal as a way of making people aware of other valuable services—for example, loft clearance for the elderly is an essential prerequisite for putting in insulation. Some voluntary or community groups might offer such a service in some areas at no cost or at a reduced cost.

A blanket ban could reduce the willingness of these organisations to play a full and positive role in the green deal. This could be especially detrimental to vulnerable groups such as the elderly, who are most likely to benefit from energy efficiency. It could also affect the ability of enthusiastic volunteers and community groups to encourage their neighbours by knocking on their door, sharing their enthusiasm and urging them to join in community projects. Members of a community or neighbourhood group are more likely to go round and speak to their neighbours individually, rather than e-mailing or writing to them. We are concerned that a blanket ban could be detrimental.

Our approach is therefore to be mindful of the points raised by the hon. Member for Brighton, Pavilion. She is right to identify the need for strong consumer safeguards, but we believe the right way forward is to build on existing regulations that protect customers, and set out a clear enforceable framework within the green deal code of practice for such activities. This will be clearly set out in our consultation and we will seek further views on this important aspect then.

Does the Minister agree that there is a world of difference between a community group knocking on a door in order to clear a loft so that loft insulation can go ahead, and selling wallpaper, carpets and sofas, which was the example that the Minister gave in Committee? Would he come some way towards supporting my amendment, given that it clearly says that it is permissible to knock on people’s door if the aim is to reduce CO2, but not if the aim is to sell a sofa?

I am sympathetic to the thrust of the hon. Lady’s amendment, but it is not illegal to sell things door to door. There is already a code of practice for that, but we do not live in a country where it is illegal for people to sell products door to door. That is already a fact of life and we do not propose to alter it; however, we do think there should be a strong code of practice. However annoying and regressive such practices may be, trying to address them outside a code of practice—that is, through blanket legislation—could affect not just loft clearance services, but the ability to go door to door, just as we as politicians go door to door trying to convince people of our ideas.

The mobilisation of community groups across a range of issues is important. We are seeing the involvement of a number of new social enterprises and community partnerships, some of which the hon. Lady is encouraging in her constituency. Indeed, one of the most exciting things about the green deal is its potential to give rise to new third sector involvement in delivering energy efficiency services. I appreciate the intention behind her amendment 26, and although I cannot support it I hope she will engage with us on the consultation that we will undertake in the autumn on strengthening the code of practice. Her input will be valuable, as it has been for other elements of the Bill.

We believe that existing legislation and the green deal code of practice will protect consumers while encouraging a healthy promotion of the green deal. However, we are also clear that elements of the green deal process must be impartial if consumers are to trust the information with which they are provided. That is particularly true of the assessment.

On the code of practice, will the Minister ensure that all lessons are learned from the failure of the energy companies to act properly on the doorstep—a fact that they are beginning to recognise themselves by abandoning doorstep selling—and that none of the bad practices from which constituents have suffered in the doorstep selling of energy are transposed into the green deal?

Yes. I have a great deal of sympathy with that point. We believe strongly that high-pressure sales tactics, which cold callers sometimes use illegally, should be prevented. When I referred previously to cold calling by assessors, that is the kind of activity to which I was referring and is, I think, what the hon. Member for Brighton, Pavilion was thinking of too.

Will the Minister also ensure that when the new measures under the green deal are being touted door to door, there will be no opportunity for the simultaneous selling of energy?

That is a good point. We certainly do not anticipate that assessors would be able to go door to door, give an assessment and then have people sign up there and then. There will be a cooling-off period. We considered in Committee whether an assessor could also be a representative of a commercial organisation or company. We came to the view that that could be possible, but that there would have to be a clear distinction between the roles they performed. An assessor would have to make their assessment on a uniform format and to the same standard right across the industry, so that it could be taken to other providers of green deal services. We would encourage all consumers to get a competitive quote before committing. If consumers wish to go with the first person who knocks on their door or the first person whom they invite in to make an assessment, it is obviously their right to do so. However, we are building in apparatus to ensure that that is not encouraged.

I am grateful to the Minister for giving way again; he is being extremely generous. Will he confirm whether he believes it would be possible under the legislation for an assessor, who is there to give impartial and independent advice about one’s energy consumption, also to be a representative of an energy company and to engage in the selling of energy to the consumer? It would be dangerous if the legislation permitted that.

Is the hon. Gentleman suggesting that an assessor would knock on someone’s door, undertake a green deal assessment and, at the same time, encourage them to switch to another tariff? [Interruption.] He is suggesting that they would switch hats and do that. I do not expect that to happen, not least because the assessment must be independent. However, there can be a degree of cross-selling, provided that the independent assessment is truly independent. However, I shall clarify that when we come to the technical detail of the Bill. I understand that what the hon. Gentleman describes is possible, but energy company practice would be covered by the regulations, such as the code of practice. We shall have an opportunity to look at the detail of what they can offer under the code of practice, but I would expect that type of activity to be strongly regulated.

However, it would not be impossible—indeed, it would not necessarily be a bad thing—for people to be able to switch to a better tariff at the same time as they were considering their energy usage. We are encouraging consumers to switch. Far too many families in this country are on the wrong tariff and do not take advantage of the cheaper tariffs that are available, often from their own supplier, particularly by switching to a direct debit. I would therefore not want to rule out the possibility of a consumer taking a green deal assessment and, at the same time, switching to a cheaper, more appropriate tariff. Indeed, that might seem quite sensible, but it will be covered by the code of best practice.

Although I agree that it should always be open to people to switch to a cheaper tariff, I am sure that the Minister would agree that energy advisers operate in an independent capacity and therefore engage with the consumer in a capacity of trust. Will he therefore ensure that if any energy adviser offers advice about switching tariffs, they will have to offer independent advice and will not be able to give it as a tied agent? Otherwise, there will be a perverse incentive for the energy companies to use a new doorstep sales technique, which will involve getting through the door as an independent adviser, switching hats—which will not always be obvious to the consumer—and then selling their own product.

I will need to consider that more carefully, because we accept that assessors can be part of commercial organisations. It is not a requirement of the green deal legislation—we went through this in detail in Committee—that they have to be totally impartial and that someone else should act as a salesman. For example, gas boilers have to be fitted to the high and rigorous standards set out in CORGI guidelines, and that work must be done independently. When we take our cars for a service and MOT, that must be done impartially and to a certain standard; yet at the same time, those doing that work are selling a service. Indeed, there are several examples of where it is quite possible for professional bodies to undertake professional services independently, transparently and to a uniform format, but where at the same time they have opportunities to sell.

Indeed, that is part of the attraction of the green deal. There is a quid pro quo at work: we are using the power of the market to scale-up the deployment of energy efficiency. Although we hope to go for an ambitious and large-scale eco-subsidy to work with the green deal, ultimately we are talking about a private sector proposition. We are creating a new market, but the investment that will drive take-up will come from the private sector, and obviously those making that investment will be attracted by more than just lagging. That is a good thing, because it will drive innovation and drive prices down as it increases competition, opening up energy services from the big six companies to a new array of retailers and, we hope, small and medium-sized enterprises and local groups. Competition will be good, but for competition there must be something for people to compete for. I hope that that reassures the hon. Member for Brent North (Barry Gardiner), but I will perhaps come back a little later to the point that he has raised.

Government amendment 30, which relates to the impartiality of green deal assessors, is a result of a commitment I made in Committee, given that so many Members were seeking reassurance on this point. It clearly sets out our intention to ensure the impartiality of the assessment process, and I urge the hon. Member for Brent North to look at it closely. We believe that it should be possible for assessors to be employed by a green deal provider, allowing for a more holistic service for consumers, but that should not interfere with the impartiality of the assessment process. The code of practice for assessors will therefore include robust requirements for green deal assessors to act in an impartial manner and declare to consumers any links that they have with green deal providers—or, indeed, energy companies. That is vital in order to retain consumer confidence in the information that they are being provided with.

The green deal seems to be a financial services product, and there will be similarities between selling that and, say, selling an ISA, rather than double glazing. This process will certainly involve selling a financial services product. Can my hon. Friend reassure me that, if the proverbial little old lady who lives alone is sold a product with a usurious interest rate, she will have recourse to the financial services ombudsman? Also, is there any intention for the Financial Services Authority to regulate the funding providers?

As this is defined as consumer finance, it will be the Office of Fair Trading, rather than the FSA, that will regulate this market. My hon. Friend makes a good point, however. It is our intention that there should be robust consumer protection, and we expect that the guidelines will be improved and refreshed to reflect the green deal. We will also expect the Office of Fair Trading to take a robust line from the very start, to ensure the integrity of the selling, and to ensure that any mis-selling is stamped out at the outset and full compensation is paid to any victims.

One of the problems with energy mis-selling was that it was a long time before many of the cases came to light. Does the Minister have any thoughts on ensuring that the standards that are to be imposed on those selling green energy are regularly inspected to ensure that any problems can be detected at an early stage, rather than finding a huge range of problems several years down the line, which is what happened following the doorstep mis-selling in the past?

I can assure the hon. Gentleman that we will keep all elements of the green deal under close review. We are embarking on a really new, large-scale proposition; there is nothing quite like it anywhere in the world. We are pioneering a new model for energy saving, at scale, and as a result we will need continually to monitor all aspects of it, especially those relating to selling and mis-selling. We will need to ensure that the legislation that we have put on the statute book, the codes of practice that underpin it and the secondary legislation that we will introduce in due course before the launch of the green deal remain pertinent. If we identify any areas in which we think improvements can be made, we will not hesitate to make them.

Given the Minister’s response to the question from the hon. Member for South Northamptonshire (Andrea Leadsom), it would be useful to know whether there have been any developments over the summer following our discussions on the golden rule. The distinction between the green deal and other financial products is that the cumulative cost of the rate of interest and the cost of the installation should not exceed the amount that people are currently paying on their energy bills. We discussed that in Committee, and it would be useful to know whether there have been any developments on that front.

There has not been any substantive development on that because we have not yet undertaken the consultation on the secondary legislation that will bring in the regulations. We have begun to hold discussions with stakeholders, and we will consult on the detail of the golden rule because it forms an important part of the measures, but there was no substantive movement over the recess.

The Office of Fair Trading will regulate the contracts. Has the Minister been in contact with his counterpart in the Department for Business, Innovation and Skills to check on the reduction in the number of officers who are able to enforce the measures? The process will put a considerable new responsibility on to the OFT.

I have not raised the matter in person, but my officials are working closely with a number of Departments—including, importantly, BIS—on that important element of the green deal proposition. We are satisfied that the OFT will have sufficient resource properly to monitor the green deal, and we will keep that under review as the green deal rolls out.

I will deal now with new clause 10 and the consequential amendment 36. The new clause has been tabled to replace the Opposition’s amendment on green deal apprenticeships, which we accepted in Committee—a great personal victory for the hon. Member for Liverpool, Wavertree (Luciana Berger). As I said at the time, it is important that we take expert drafting advice on any amendment to a Bill, however well intentioned it might be. I reiterate that we fully support the creation of apprenticeships in green deal-related trades, and we will be happy to report to Parliament on our progress, as the hon. Lady requested. We believe that the new clause captures the spirit of her amendment; it simply clarifies a couple of technical matters regarding the exact nature of the new obligation. It requires the Secretary of State, before making the first framework regulations, to report to Parliament on the steps that he has taken to encourage green deal installation apprenticeships. I hope that that satisfies the hon. Lady.

Taken together, these are important measures in what will be the most ambitious home improvement programme since the second world war, and I hope that the whole House will support them. There are other amendments in the group that I have yet to address.

Getting back to the financing of the green deal, is the Minister aware that 1.9 million people are in arrears with their energy bills, and that that number is increasing by the day because of the increasing price of energy? Is he also aware that 5.5 million people are living in fuel poverty, and that that figure is also rising by the day because of the problems with the energy companies? Will not those people who have been unable to pay their bills have difficulty in gaining access to finance for the green deal?

Of course they will have access, although it might vary in individual cases—I cannot give a universal commitment. The hon. Gentleman is right to raise fuel poverty, and in the Adjournment debate this evening called by his hon. Friend the Member for Glasgow North West (John Robertson) we will be able to debate the matter more specifically. Importantly, for the most fuel-poor there will be the energy company obligation. We fully recognise that a significant number of families will simply not be able to afford to pay for the green deal interventions through paid-for savings, because if they cannot afford to spend the money on heating in the first place, they will not capture the savings. We will therefore ensure that the very substantial energy company obligation will be directed towards meeting the needs of those vulnerable consumers.

The energy company obligation does not wholly focus on the people I mentioned, though. My worry is that the 1.9 million people in arrears and the 5.5 million people in fuel poverty—the poorest and most vulnerable, many of whom are elderly—will not be able to get finance under green deal. I am worried that that will create more poverty and do great harm to those who need help the most.

One or two, or small numbers, may fall through the net, but by and large we have to think about how the green deal will be implemented. Many of the families and individuals the hon. Gentleman is worried about will be captured by community roll-out and street-by-street roll-out of energy efficiency improvement schemes. We have the ECO so that we can offer whole communities the same service on an equal footing, regardless of their ability to pay. We will have to think about how to ensure fairness, because we want to include people living in isolated communities or those living in a relatively prosperous areas in a detached home, perhaps on their own, but I think the vast majority of the types of vulnerable consumer the hon. Gentleman is worried about will be captured by the whole-community approach that we anticipate will be taken up by many local authorities in street-by-street approaches. We need the ECO to be able to offer insulation and home improvements to whole streets, regardless of income, to ensure that we do these things at scale. I do not pretend that we have the perfect solution, but I believe that what we have is by far the best approach in comparison with anything tried before.

With that, I will finish. I will respond to the other amendments raised by hon. Members when I wind up the debate on this group.

We are delighted that the Government are keeping the amendments proposed in Committee. We accept the proposals to make the provisions more workable, as the Minister set out.

I wish to speak to my amendment 28. I am delighted to hear the Minister say that he will respond to it later, which allows me to make my points before they are addressed.

I say at the outset that I think the green deal is a fantastic idea. As we went into the election campaign, I was very enthusiastic about it and I found a lot of support for the concept on the doorstep. I pay tribute to the ministerial team for bringing it forward so quickly and in such a concise manner. It is especially important because it provides for improved energy efficiency of our housing stock, which is vital to protect not only the environment, but residents. It will also have the benefit of reducing carbon emissions and hopefully, if it works correctly, insulate our residents and consumers against rising energy prices. If the “pay as you save” model works as envisioned, many more homes will be made much more energy efficient than could have been achieved under the previous schemes, whose limitations anyone who has served as an MP or a local councillor will have seen. This model is a great improvement.

Affordability is a massive issue for our constituents, as no doubt all of us have seen over the summer, with a large amount of correspondence in our postbags arising from various energy companies raising their prices. Citizens Advice has informed me and other Members that there has been a 78% increase in hits to its advice websites compared with a year ago. That clearly demonstrates how welcome is any measure that helps to bring down prices and encourage energy efficiency. It is in all our interests that the green deal works properly and effectively and is accessible to as many residents as possible on an equal basis.

There are some concerns—the Minister probably heard them in Committee—about the attractiveness of the green deal to certain sections of our constituents. The Great British Refurb campaign has said that although the green deal is attractive, mass demand will be contingent on a number of factors. I believe it surveyed about 2,000 people across the UK and found that whereas 56% of respondents saw the green deal as attractive, only 7% said that they would be prepared to take it up if a 6% interest rate applied. That is why my amendment focuses on interest rates.

We need to ensure that the interest rates are as low as possible to make the scheme as attractive as possible to as many people as possible. That is what amendment 28 would allow. The advantage of setting a single scheme interest rate is that it will stimulate demand from as many people as possible while forcing green deal providers to compete directly for customers based on the cost and quality of the energy efficiency measures and installation, rather than on the headline interest rate of the finance. I believe that it will also help to increase transparency and empower consumers who would find it much easier to compare different offers and the services provided by different companies.

Does the hon. Gentleman agree that the people most likely to be affected by high interest rates are the poorest, so having a level playing field will ensure that everyone gets the same deal rather than only those who can afford it getting the best deal?

I thank my hon. Friend. I am aware of his work in this area. He has said exactly what I am going on to say. It is important to ensure that the scheme is as attractive as possible to the poorest households, which, as he knows, are at the greatest risk of fuel poverty.

The alternative to a single scheme interest rate is risk-based pricing. In my view, green deal finance providers must not be able to price green deal finance packages based on the perceived default risk of the original occupier, given that the work done will stay with the property probably long after that household has moved on, sold up or moved to a different private rented property. It would be unfair and illogical to allow that to happen, given that there is no way of predicting the default risk of any future occupants. We cannot price with accuracy on that basis.

I perfectly understand the hon. Gentleman’s point that the debt will be tied to the property and that the rate should be based on an average, but does he not accept that there is a very real tension between the need to persuade householders to embark on the green deal in the first place, which will happen only if they can see financial gain for themselves over the period that they propose to occupy the property, and the potential financial gain to the average family in the future? His proposal may create tension between the ability to sell the property and fairness to subsequent occupiers.

That, of course, is exactly what the golden rule is designed to protect against. My concern is that we offer residents—people living in the properties now—an equal interest rate across the whole area. We need to avoid people in more affluent areas being encouraged to take up the green deal by a lower interest rate than is offered to people in poorer areas or those perceived to be a higher credit risk, particularly tenants. There is a risk that landlords might be put off the green deal if they perceive that the cost is based on the occupancy of a particular tenant.

I very much support the tenor of the hon. Gentleman’s remarks and I wonder whether he supports my new clause 8, which would serve to make the green investment bank a vehicle whereby we could ensure that a common and low interest rate—one that is subsidised—is applied?

I looked at the hon. Lady’s new clause and amendments, which are interesting. I look forward to hearing the debate and listening to the Minister’s response to them. I am sure that he will say something to reassure her.

I am concerned that landlords might be unwilling to take out a finance package if they perceive it as reducing the market value of their property. Under risk-based pricing, those with a poor credit rating—often people on low incomes, who are at the highest risk of being in fuel poverty—might find themselves, by accident rather than design, excluded from accessing a green deal finance package. Tenants in the private rented sector may be at a high risk of exclusion from green deal finance, because the underwriting process for mortgages is such that home owners are likely to have a better credit rating. The Minister rightly said that we should extend as much choice as possible to residents. We need therefore to ensure that as much choice is offered to tenants in the private rented sector as is offered to property owners, and that is, I am sure, what the green deal is intended to do.

I am very sympathetic to the hon. Gentleman’s suggestion that there should be a non-discriminatory interest rate across green deal finance, but does he not accept that the golden rule itself is, to an extent, a measure of mitigation of what may well be universal high interest rates, set by green deal providers on the grounds that they are private companies providing finance? Does he accept that ensuring that there is a level playing field for finance in general does not resolve the problem that the golden rule may result in very few changes being made to a property as a result of high interest rates, and that additional measures such as green investment bank intervention may well be needed?

I take the hon. Gentleman’s point and will be interested to hear Ministers’ response to it. Although we understand how the green deal must operate, we all want to ensure that it is made as attractive as possible and that there is as much choice as possible. What worries me is that if we go down the route proposed, poorer households and, in particular, landlords may be put off.

With risk-based pricing, I fear that people with short tenancies may be charged a higher interest rate than owner-occupiers or tenants who have lived at the same address for a long time. Short-term tenants who default may be difficult to pursue and may already have a chequered credit-rating history. More important, however, is the fact that risk-based pricing is probably unnecessary. As others have pointed out, the golden rule should mean that no one, whatever their credit rating, ends up paying a higher energy bill than they would have without the green deal.

If risk-based pricing is permitted and finance providers try to charge households with poor credit ratings higher interest rates, the total cost of the measures could exceed the golden rule threshold, with the result that such households are likely to be refused green deal finance altogether. I think that that is the point that the hon. Member for Southampton, Test (Dr Whitehead) was making. Although it is possible that the golden rule will hold interest rates at a reasonably low level for most consumers, it will not do that for all of them. As the Minister said, other options are available, but while the energy company obligation may help the very poorest, some consumers could be trapped between the two. I should be interested to hear his response to that as well.

As I said at the beginning of my speech, we must design a system which, as well as being future-proof, can be drawn as widely as possible. I represent a great many people in private rented accommodation, particularly in Goole, and much of it is of poor quality, consisting of single-skinned brick terraced houses to which earlier schemes could not be applied because they had no cavity walls. I do not want private landlords to be deterred from encouraging tenants to take up the green deal because they fear that their properties will be devalued in the future as a result of the higher energy costs.

Many tenants have told me that they have huge problems with damp, meaning that there are rooms that they cannot use. Their houses are crying out for energy efficiency measures. I do not want them to be the ones who do not benefit from the green deal, while constituents living in leafier areas who happen to own their properties do benefit from it, and I know that the Government do not want that either.

The Minister mentioned the ECO, which focuses in two directions. Does the hon. Gentleman agree that it should focus solely on those who most need energy efficiency measures and who are unable to pay for them?

That is entirely the right principle. The communities to which I have referred, many of whom I represent, risk fuel poverty because they live in the very worst properties with the very worst energy efficiency ratings.

I will not press my amendment to a vote because I think that the green deal is an exciting proposal, I strongly support it, and constituents to whom I have spoken find it very attractive. However, I shall be interested to hear what assurances Ministers can give me and people outside that the scheme will be designed to be as accessible as possible to as many people as possible, and that it will not exclude anyone. No matter how small their number—it may be just the odd one or two—there are people who are very much at risk, and they must be drawn into the scheme by some means.

My name is attached to five of the 15 new clauses and amendments in this group. New clause 8 would require the Secretary of State to report to Parliament within six months of the Bill’s becoming an Act with proposals on how the green investment bank could maximise take-up of the green deal.

Much more needs to be done to make the green deal as attractive and appealing as possible. Given that the energy companies have found it difficult to give away energy efficiency measures in the past, I fear that the “pay as you save” mechanism, as currently designed, will not be enough to drive the level of adoption, or the depth of the improvements that are needed for the delivery of huge emissions savings from our housing stock. In Committee we discussed possible drivers, including council tax or stamp duty rebates linked to the green deal, and reduced VAT rates for products bought under it. I support all those options, but I think that we should chiefly explore the idea of using the green investment bank to subsidise the interest rates, for all the reasons given by the hon. Member for Brigg and Goole (Andrew Percy).

The hon. Gentleman mentioned a survey. I have figures from the same survey. A key statistic that the hon. Gentleman did not mention was that about a third of home owners said that if the interest rate were set at 2% per annum, they would be “very” or “fairly” likely to take up the green deal. As the hon. Gentleman said, the figure fell to just 7% of home owners when an annual interest rate of 6% was suggested. It is clear that if the Government are still considering interest rates above 6%, they will face real challenges in attempting to drive sufficient take-up.

In Germany—which I realise operates a different scheme—an energy efficiency household loan programme offers publicly subsidised interest rates of 2.65%. That programme has achieved 100,000 residential retrofits in a year. The Government must achieve 145,000 every month if they are to fulfil the ambition that they set out at the beginning of the process, and they are intending to do that at market interest rates, which are much higher. I do not see how that will work.

It is not correct to compare the two schemes. The German scheme consists of a normal personal loan, secured in the normal way. It must be applied for through the banks, and in the case of a successful application the interest rate is subsidised. That is the nub of the programme, which I have discussed in Berlin with the German environment Minister. There is a great deal more to the green deal, which involves substantial subsidy not of the interest rate, but of the interventions themselves. We expect that most solid wall installations will attract a substantial element of subsidy, and that other interventions for fuel-poor households and more vulnerable customers will also be able to attract subsidies. Customers may pay a competitive interest rate, but they will be doing so on a significantly subsidised final bill, and I would have thought that it was much better to pay a competitive interest rate on a smaller bill than a subsidised interest rate on a higher bill.

This is a fundamentally different proposition, therefore. The German scheme simply involves subsidies of existing loans. What makes the green deal unique is that it is not a personal loan in the way the German scheme is. It will be secured against savings on future energy bills. It will not add to the personal debt of the individual who benefits from the installations, and it will remain with the home. There is also the golden rule. I apologise for making such a lengthy intervention, but it was important to put that on the record.

We discussed this matter in Committee, so I know that the Minister and I do not agree. I still do not think that the measures under the green deal will be significantly subsidised. I agree that we have the ECO pot of money for the fuel poor and hard-to-treat homes, but the figures that have been discussed in respect of the ECO are about £1 billion to £2 billion, which is a small amount given that we hope there will be mass take-up of the green deal. Most people who take up green deal provisions will therefore not feel that they are being significantly subsidised. I still do not agree with the Minister that this proposal will in its current form be attractive enough.

In the light of the Minister’s intervention, the hon. Lady might want to point out to him that the logical consequence of setting a market rate in respect of the green deal and the golden rule is that a significant proportion of those who cannot access the green deal at a market rate will be pushed into the ECO. That underlines the point made earlier about the purpose of the ECO: is it a fuel poverty device, or is it a device to mop up, as it were, those people who cannot afford the green deal at a market rate, which the Minister appears to think is the case? If it is the case, perhaps it ought to be clearly spelled out in our discussion.

I am extremely grateful for that helpful intervention. It focuses on some of the contradictions in respect of the purpose of the ECO, and I hope that in this debate we can make clear what exactly the ECO will be for, how big it is going to be, the extent to which it is intended to subsidise those who are in genuine fuel poverty, the extent to which it is intended to subsidise those who cannot afford market interest rates, and the extent to which it is for hard-to-heat homes. There is a lack of clarity, and I worry that ECO is being used as a kind of get-out-of-jail-free card, in that whenever there is a difficult question, the ECO tends to be the answer. There simply is not enough money in the ECO for it to be the answer, however. The financial community has much less appetite than has been suggested for providing affordable green deal finance, which is why the green investment bank must step in.

As Members may remember, on Second Reading the Secretary of State quoted Conor Hennebry, director of global capital markets at Deutsche Bank, as having said that

“‘the City is practically champing at the bit to finance the government’s green deal.’”—[Official Report, 10 May 2011; Vol. 527, c. 1059.]

That sounds very good, but the Secretary of State failed to add that Mr Hennebry went on to say:

“Financing the green deal is absolutely possible for us”—

the City—

“but whether the figures will stack up for you is a different matter.”

That is the crux of the issue: will the figures stack up in respect of rolling out this programme as widely as possible? I do not think they will. It is not at all clear that the figures will stack up for householders, unless there is Government support through either the green investment bank or the ECO. If the ECO is to be used, that is fine, but we must make it an awful lot larger and make its provisions a lot clearer.

No matter what interest rate is applied to the loans, it is vital that consumers have confidence that their rights will be protected if they take up a green deal offer, and I seek to strengthen those protections in amendments 26, 49 and 50. Amendment 26 would ensure that only products and services that reduce household emissions could be sold during green deal assessments and installation visits. Amendment 49 would ensure that consumer protections on the repayment of a green deal loan are extended to energy advice services or energy plans that are not specifically green deal plans. Amendment 50 would ensure that the Secretary of State can make regulations to ensure that quotes provided for green deal goods and services are easily comparable.

The Minister mentioned amendment 26 on what can and cannot be sold as green deal assessors go house to house. I do not propose a blanket ban. The amendment has changed since Committee. It is perfectly okay for somebody to knock on doors if they are talking about measures to reduce CO2 emissions, but it is not okay if they want to talk about wallpaper, for instance. I do not mention wallpaper in order to be frivolous. Rather, I wish to remind the Minister of what he said in Committee:

“If Marks and Spencer, or any other retailer, went into someone’s home to offer them a green deal, I am sure that it would also take the opportunity to market wallpaper, carpets and, if the walls are being lined, curtains and perhaps a sofa. This is a huge opportunity for home improvement, which will not be lost on responsible retailers. They will offer not just additional energy measures, but a whole package of other home improvement measures in a commercial atmosphere.”––[Official Report, Energy Public Bill Committee, 9 June 2011; c. 120.]

I am not at all relaxed about that, because I think it will lead to the pressurised mis-selling of products unrelated to energy efficiency, and that could completely undermine the green deal. There have already been similar problems in the small-scale renewables market, and they must be prevented in the context of the green deal. Sales in the home do not happen in a commercial atmosphere. Green deal assessors or providers are invited in because consumers are interested in energy efficiency. It is vital to ensure that commercial enterprises do not abuse the terms of those visits by pushing products that will not improve a home’s energy efficiency. I agree with the hon. Member for Brent North (Barry Gardiner), who pointed to the danger of some enterprises using the opportunity of being in someone’s home to try to persuade them to change to a different tariff as well.

The hon. Lady will remember that when the financial services regulations were introduced, banks had to declare up front whether they were providing information and advice to their customers in an independent capacity or as a tied agent for themselves. Does she agree that it is also important in terms of the green deal that people who have gained a householder’s trust and entered their home on the basis that they are providing impartial and independent advice do not, once inside the front door, switch hats and start offering advice as a tied agent of another service provider?

I completely agree. Trust is crucial if the green deal is to be successful. We want people to be talking about it, telling their friends and neighbours how great it is; we want there to be a real buzz and momentum behind it. If there are just a couple of cases of such mis-selling, the whole process will be undermined.

I also seek to extend the same consumer protections for the repayment of a green deal loan to energy advice services or energy plans that are not specifically green deal plans. If a householder decides after the initial green deal assessment to pay for the services up front without the need for a green deal loan, they ought to be eligible for the same kinds of protection they would receive if repaying the loan in a different way. If the clause in question is left in its current form, regulations regarding protection and redress will hang not on what a consumer buys, but on how they pay for it. That is perverse. If the consumer pays up front, the protections and regulations will not cover them. Only if they take the green deal loan will they have those protections. If people are not protected until they have signed a contract, how will that help consumers during the advice and contracting stage when they may not have decided to pay for green deal services yet, let alone how to pay for them? Also, who can the consumer complain to about pressurising sales tactics if they walk away before they have signed the contract? Will consumers choose the financial option that is best for them if they have to use green deal finance to get ongoing support from the advice line and redress scheme? I hope the Minister will address those questions in summing up.

My final concern in relation to this group of amendments is about the comparability of green deal quotes. It is vital that consumers are in a position to make an informed choice about which green deal is best for them, and that could be nigh impossible if the different quotes received are hard to compare. I should like the Minister to address this by ensuring that all green deal quotes are provided in a way that makes them very easy to compare with one another, to judge and to assess.

I have detained the House for some time so I shall conclude. My final amendment in this group would give consumers the right to choose which energy bill their green deal loan repayments would be applied to. In 78% of occupied British buildings, heating and hot water are provided by natural gas, so that is the fuel most likely to be reduced after a green deal makeover. It therefore seems logical for customers’ gas bills, where possible, to carry green deal loan repayments because if the golden rule is working, their gas bills will not become more expensive after the green deal repayments have been applied. It is there that the advantage of the green deal will be most apparent to householders.

If the repayments are added to electricity bills, those electricity bills are not likely to fall so much after a green deal makeover unless a home’s space and water are heated by electricity, but far fewer homes are heated by electricity than by gas. That means that in the vast majority of cases, green deal customers will potentially have lower gas bills but higher electricity bills. That makes it harder to see whether the golden rule is working and risks undermining the central pay-as-you-save principle, as well as eroding customers’ confidence in the value of the deal. I hope the Minister will therefore consider allowing consumers to choose which bill they want their green deal payment to be applied to so that their management of the green deal is as straightforward as possible.

I am delighted to follow my hon. Friend the Member for Brighton, Pavilion (Caroline Lucas), who has made a very informed speech about exactly the points at the heart of the measures. I, too, want to address the green deal to dig out more about the golden rule and the energy company obligation. We all agree that it is right that energy efficiency improvements should be provided at no up-front cost. That is a good thing that we all support across the House and want to see implemented. As has been pointed out, however, the loans will be provided at commercial rates through the green deal and will attach to the property, not the householder, for up to 25 years.

The golden rule has been introduced to require that all green deal loans are less than the repayment cost resulting from the installation of the measures. The qualifying energy efficiency improvements will be determined through the energy performance certificate. This means that any savings will be estimated and based on standardised use. As a result, there are no guarantees that actual savings will match or better the estimated savings, as I pointed out to the hon. Member for Brigg and Goole (Andrew Percy). The Bill’s central premise is that consumers will save more on their energy bills than they will repay in loan costs and that that will be enough to drive consumer demand. However, the Bill provides little detail about how demand for the green deal will be driven beyond that basic finance mechanism other than through the introduction of the new ECO, which will underpin the deal and subsidise properties that require energy efficiency improvements but for which the golden rule would not be met.

It is estimated that the green deal will reach more than 40 million homes by 2020 and a further 12 million by 2030. That amounts to the retrofitting of 1.7 million homes a year—that is 4,800 a day—between 2012, when the green deal starts, and 2020. The Committee on Climate Change has estimated that, between 2012 and 2022, we would need to insulate 8.3 million lofts, 5.7 million cavity walls and more than 2 million solid walls to meet the UK’s carbon budget. The Government’s expected take-up of those measures, through the green deal and the extension of the carbon emissions reduction target, misses those requirements by 3.8 million lofts and 2.7 million cavity walls.

Although I support the aspiration behind the green deal, it is difficult to see how it can be achieved under the proposals. Indeed, the Committee on Climate Change’s third progress report to Parliament concluded that the Government proposals should help to strengthen incentives for the take-up of energy efficiency measures. However, there is a significant risk that they will not adequately address the range of financial and non-financial barriers. I do not want to talk the measures down because Members on both sides want them to work, but it is important that we are realistic about their likelihood of success.

The economies of energy efficiency retrofits at today’s energy prices simply are not attractive, as my hon. Friend the Member for Brighton, Pavilion has pointed out, because of the gap between projected returns based on current energy prices and the cost of borrowing—a gap that can be met only if substantive subsidies are applied. Recent analysis by E3G has highlighted that at today’s prices and with the commercial interest rates that the Government intend to apply to green deal financing, the golden rule cannot be met on a 25-year loan. The Government have quite rightly identified that the up-front costs of improvement and access to capital are significant barriers to the uptake of energy efficiency, but we should be clear that the green deal alone will not overcome them. Without intervention to limit the cost of borrowing, consumer demand for green deal programmes could be very low indeed.

Furthermore, access to capital is not a universal problem. For those who can afford them, savings, mortgage extensions and personal loans have long been readily available to provide up-front capital for energy efficiency investments, yet they have not been used on any scale, despite the fact that many people are able to procure those borrowings at 5% or 6%, let alone at the 11% that the Government are suggesting. Financing through the green deal simply does not stack up for the rational investor, and particularly for low and middle-income households.

Let me give an example. The annual energy bill for an average household is calculated at £1,029 a year. A good whole-house retrofit would be expected to save approximately 50% on the average energy bill—in this case, just over £500 a year. Solid wall insulation was identified by the Committee on Climate Change as the main energy efficiency measure that could usefully be financed by the green deal, but according to DECC’s own analysis, the capital cost of solid wall insulation ranges between £7,600 and £12,600. Let us take the cost of £12,600 and the maximum saving of £500 a year; in fact, DECC’s analysis estimates that solid wall insulation would save only £400 a year, but I give it the extra £100. Through the green deal, if we pay back £500 a year, through the savings on the energy bill for that average house, against the £12,600 loan over 25 years, we still do not pay back the full amount. That deal fails the golden rule.

An energy company obligation is being introduced to subsidise the difference, reducing up-front costs to the point that they are less than the energy savings. The Committee on Climate Change estimates that up to £17 billion of support will be required through the ECO to insulate 2.3 million solid walls by 2022, but the Government estimate that the total ECO support will be only £1 billion. The fact that the golden rule cannot be met even before the cost of finance is factored in is a matter of huge concern.

The Government have calculated that the green deal’s financial cost will be cheaper than a market personal loan, but they concede that it could mean rates of up to 11%. At today’s energy prices, to drive demand by meeting the green deal’s golden rule, 25-year loans would need to be offered at rates of 2% or less. E3G’s recently published analysis concluded that a £15,000 loan at 0% over 25 years for changes that delivered a 50% energy saving and lifetime savings of £2,461 could meet the golden rule in year 8, but that the same loan offered at just 2% would incur losses of £1,747 over that 25-year period, whereas a similar £15,000 loan for changes that delivered just a 35% energy saving would not break even at all even with interest at 0%.

At more commercial rates, the economies of the green deal are simply unmanageable. Households with access to capital—those with the option of using savings, mortgage extensions or personal loans—are not using it for this purpose and will not be incentivised to do so under the Bill. Low-income households could require up-front grants of 55% of the overall cost of making energy efficiency improvements, simply to reduce costs to a level where the remainder of the capital could be borrowed at commercial rates over 25 years without any negative impact on annual household outgoings. For many investments to break even over that 25-year period, they would need a significant subsidy via the ECO.

The ECO’s objective is to support low-income and vulnerable households and properties that need energy efficiency measures that do not meet the golden rule. The cost would be recovered from increases in consumer bills. That is a worryingly regressive means of funding energy efficiency measures, particularly given the likely subsidy that will be required to make the green deal viable. In my example, under the ECO, many households that do not benefit from energy efficiency improvements could subsidise those that do.

The ECO will be accompanied by the withdrawal of the Warm Front scheme by 2014. It will be replaced by the affordable warmth element of the ECO, the purpose of which is to provide up-front support to help households heat their homes affordably. In 2009-10, Warm Front delivered more than 21,000 cavity wall and 40,000 loft insulation measures, as well as 80,000 boiler replacements. I should be grateful if the Minister he clarified what proportion of the overall ECO will be targeted at the affordable warmth element and the criteria that he will apply to determine what low-income households will be eligible and how many retrofits the Government estimate will be carried out under the affordable warmth obligation.

It is helpful at this point to refer to the Treasury levy cap, which has not yet been mentioned. We will not know for some time whether the Office for National Statistics will determine that the ECO should be considered in the same vein as the warm homes discount, the feed-in tariff and the renewable obligation. If it does, the ECO could be even more constricted and less than the figures that my hon. Friend is talking about.

The shadow Minister is absolutely right that there has yet to be clarity on the issue, and clarity is vital. If we are to meet the targets that the Committee on Climate Change has set and the budgets, we must know that sufficient funds are available for the ECO to meet those targets. At present, my analysis and other analyses are quite clear that up to £22 billion is required, although an absolute cap of £1 billion might be provided under the ECO. As my hon. Friend suggests, that £1 billion might prove not to be a full £1 billion after all.

On new clause 9, the Secretary of State for Energy and Climate Change has estimated that the green deal will lead to employment in the sector increasing from 27,000 jobs currently to something approaching 250,000 jobs by 2020. That involves the creation of 27,875 jobs every year from the start of the green deal until 2020. Double the number of jobs that currently exist must be created every year. We heard earlier at Prime Minister’s Question Time about the latest unemployment figures and particularly the problems of youth unemployment. Of course, if those jobs were created, we would all welcome them, but there must be a doubt about these provisions.

In opposition, the Prime Minister called for a revolution in skills and training, so that the skills system responds far more effectively to the needs of individuals and businesses in a greener economy, but the recent green economy road map recognises the importance of that and refers to the introduction of new skills for a green economy and the grouping of sector skills councils to help businesses understand the changing skills requirement. It is crucial that that new grouping of sector skills councils supports the development of the additional 27,875 jobs every year between now and 2020. It would be of considerable interest to the House if the Minister explained what financial provision will be made to the sector skills councils to enable that sort of expansion—a tenfold expansion—to take place in the next nine years.

I should like to start by thanking the hon. Member for Brighton, Pavilion (Caroline Lucas) for tabling amendments 49 and 50 and my hon. Friends the Members for Manchester, Withington (Mr Leech) and for Brigg and Goole (Andrew Percy) for tabling amendment 28.

Amendment 49 would require that any energy efficiency services provided or products sold by green deal participants, in addition to those paid for with green deal finance, should be subject to the green deal regulatory framework. It is important to note that the green deal is an innovative form of finance agreement that is attached to the meter and therefore passes between bill payers. I think that we all understand that. So it needs specific protections, which are not necessarily relevant to those who do not take out the green deal.

I should like to assure hon. Members that we intend to require customers to be made fully aware of the difference between offers that fall under the green deal scheme, with all its specific safeguards, and those that fall outside. However, many of the forms of mis-selling that rightly concern the House can be prosecuted already under existing general consumer protection legislation. We will not accept companies using green deal accreditation as cover for less appropriate goods and services.

Amendment 50 would ensure that recommendations and estimated costs and savings are clearly and transparently communicated to the consumer as part of the green deal plan, thus enabling customers to compare offers. I should like to reassure hon. Members that we intend to require green deal providers to set out clearly how the proposed savings and costs meet the golden rule principle, as enabled by the power in clauses 4 and 5. I urge hon. Members to look specifically at clause 5.

In addition, the Consumer Credit Act 1974 will apply to domestic green deal plans in full, bar a few essential amendments, thus ensuring robust consumer protection, and it already regulates the provision of information to consumers who enter into credit arrangements.

I wonder whether the Minister can clarify things a little further. On amendment 50 and comparability, is he saying that there are some guidelines somewhere that will ensure that many different green deal providers will be required to present the savings that are likely to accrue from investing in a green deal package in a similar way, so that they are genuinely comparable? On amendment 49, if a green deal assessor goes in and after a big assessment the householder decides not to take a green deal finance package but to pay up front, will they be unable to access things such as an advice line?

Such people can certainly access the advice line. If people choose to pay in full and not to take finance agreements, they will not be any less covered by the accreditation of all green deal service providers and the protection and warranties that go with all green deal products. We must not forget that the green deal is not just about financial arrangements where consumer protection kicks in. We will set out in further detail in secondary legislation, which hon. Members will thoroughly scrutinise, and go to great lengths to ensure that there is a rigorous consumer protection element to the accreditation of all services that are green deal applicable. That will apply whether or not they are financed by consumer credit. Obviously, all products must be specified and approved for use under the green deal to ensure that they meet the golden rule.

I welcome the fact that the Minister has said that customers and consumers will be protected by consumer credit legislation, and I welcome the fact that robust secondary legislation outlining further protections will be put in place. Will he tell the House at this stage whether he believes that consumers will be protected by the legislation that applies to the financial services industry so that an adviser can act either as a tied agent or as an independent agent, but not mix and match the two roles—at least not in the same consultation? If that protection is not provided by existing legislation, will he ensure that it is introduced in the secondary legislation to which he referred?

We will have to disagree on this. I understand the protections that the hon. Gentleman is trying to insert into the Bill, but I take a slightly more optimistic view of the potential both for introducing competition in the green deal process and for home improvement.

The biggest driver for take-up—and this is different from the German experience—is not concern about climate change and, surprisingly, it is not even concern about saving money on energy bills. The consumer research that our stakeholder forums have commissioned is revealing, because the majority of consumers said that the biggest factor in their taking up the green deal would be a desire to make their home nicer. That may seem counter-intuitive and surprising, given the high cost of energy, but more than half of respondents indicated that home improvement was the driving force. We need to harness that, and it is little wonder that people failed to respond to energy companies that were not in the home improvement game. They will be responsive, however to new entrants to the market such as B & Q, Marks and Spencer, John Lewis and so on, which excel in offering aspirational consumer propositions. Many people will seek to improve their house, and see no contradiction in making improvements by purchasing new wallpaper and carpets while, at the same time, undertaking energy improvements. I regard this not as an either/or conflict, but as an opportunity to ride on the back of that motivation. Rather than offering a hairshirt proposition, we should harness the inherent instincts of the British public to improve their home, and make it both nicer and warmer.

I welcome the arrival in the market of a host of new players offering additional propositions for home improvement that fall outside strict energy efficiency measures, because that will draw in more people and catch their interest, but—and it is an important but—we must ensure that the integrity of the independent assessment is upheld. We must ensure that there is no inappropriate cold calling or hard selling in the home, which is why we will thoroughly review the measures that are in place. If the evidence shows that they are not sufficient, we will introduce strong codes of practice and ensure that assessments are thoroughly independent. However, I do not share the pessimism of the hon. Member for Brent North (Barry Gardiner), or his reluctance to introduce the two measures alongside each other. As long as that is done in a thoroughly transparent and responsible way, it could be a benefit, rather than a negative.

The Minister has said that in his view the green deal is market driven—that is a fundamental difference from the German scheme—so investment by commercial companies will propel the scheme forward. He is telling the House that, in a sense, it is driven principally by the profits that those companies will make. It is not driven by the imperative of increased energy efficiency, or by the need to meet the carbon budgets set by the Committee on Climate Change, or by the need to address fuel poverty. It is driven by the profit motive. I am willing to capture the drive that the market can bring, but the focus of the scheme, as set out by the Minister, is fundamentally wrong.

I know that the hon. Gentleman is not quite an unreconstructed, planned-economy socialist, but he is confusing means with ends. The purpose of the green deal—our starting point and our end point—is to meet our carbon budgets and fulfil our legal and statutory obligations under the Climate Change Act 2008, which was introduced with the support of Members in all parts of the House. For decades, we have singularly failed to drive effective home energy efficiency and, come to that, energy efficiency in the business and industrial sectors. Given the size of the deficit and the burden on the public purse, we are living in cloud cuckoo land if we imagine that we would drive down carbon emissions and transform home and business energy efficiency if we left the private sector untapped. We will achieve our objectives only if we harness effectively the power of the private sector. Of course, people will make profits, but provided that that is transparent and fair, I do not have a problem with it. It is called job and wealth creation, and spreading that widely. We do not have enough wealth creation in the UK—we need more—and the green deal will be an incredibly important vehicle in helping us to rebalance our economy and making us more efficient.

We should not ignore that, but it does not detract from the fact that the central aim of the legislation is to allow us to meet our stretching carbon reduction targets. The coalition is absolutely committed to doing so, and the green deal is the means to that end, so we should not confuse the two as the hon. Gentleman did.

Amendment 28, which was tabled by the hon. Member for Manchester, Withington and my hon. Friend the Member for Brigg and Goole, seeks to ensure that we have powers to place restrictions on interest rates that can be offered as part of the green deal plan. I understand the concerns that my hon. Friend the Member for Brigg and Goole articulated in his thoughtful speech, but I can assure him and other hon. Members that clause 5(1)(b) already provides the power—we accept the point that the hon. Gentleman is making—to limit interest rate structures that can be applied to green deal plans. It will not be possible to create a valid green deal plan, unless it specifically complies with the conditions contained in, or made under, clause 5.

The green deal is a market mechanism, and the golden-rule principle will create a natural incentive to drive down costs, so the Government do not intend to place restrictions on the level of interest charged. However, we are considering broader restrictions to ensure that green deal plans are equitable not just for the first but for all subsequent bill payers. This could mean limiting interest rate structures offered to domestic customers to those with the greatest likelihood of the golden rule being met in the first and subsequent years, and we will be consulting on what is quite a complicated area, not just with stakeholders in the financial services sector, but with all concerned stakeholders.

I would certainly welcome the thoughtful input from Members on both sides of the House into this important area of how we ensure we get the most competitive interest rate for the consumer. I invite my hon. Friend the Member for Brigg and Goole, the hon. Member for Manchester, Withington, and other hon. Members who have spoken in the debate and expressed legitimate concerns, to meet my officials so that we can ensure that we take notice of their concerns and take advantage of some of their ideas. I hope that I have been clear throughout proceedings on the Bill that we do not have a monopoly on the best ideas. As we develop the fine detail of the green deal, I am more than happy to work with them.

We recognise that the interest rate is only one of the drivers of affordability. We do not want unnecessarily to focus just on the interest rate. The actual cost of the products, particularly things like solid wall insulation, will be a key driver. Replacement windows are in a very exciting place. For the first time, because of technical innovation and the increased thermal value of new glazing, and because prices are coming down, we can anticipate that we will be able to include glazing in windows. Consumer-facing home improvements will come within the remit of the green deal, and make it much more attractive. The green deal will not just be about out of sight, out of mind, hidden interventions in a household, but about things that people will really value on a day-to-day basis.

Will the Minister give a categorical guarantee that anyone who cannot pay the green deal part of the bill will not have their supply disconnected?

The hon. Gentleman’s question is predicated on a misunderstanding. It will simply not be possible for any consumer, poor or rich, to disaggregate their bill payments for the green deal, other charges and the energy consumed. There will not be that opportunity to withhold green deal payments, just as one cannot refuse to pay transmission charges or other levies that are included on the consumer bill. That will not be an option for them.

Will the Minister confirm that he is still leaving the door open to using the green investment bank to support and subsidise the interest rates? I am not clear what he is saying specifically about the green investment bank.

That is a very important point. I do not rule it out completely. It is unnecessary to do so at this stage. But we do not anticipate that it will be necessary, and it is certainly not part of our planning and budgeting. Rather than the green investment bank subsidising interest rates at the consumer end of the journey, it is more likely that it will play a role in helping to pump-prime the liquidity in the bond market when we first see companies taking these aggregated packages of green deal finance and seeking to offer them into the bond market as new securitised products. In the long term, there is an exciting future, and there will be a lot of strong institutional demand for such products.

The conversations that we have had with the largest city institutions and banks have been encouraging and we have set up a working group. Short-term interventions to aid initial liquidity are more likely to be a fruitful use of green investment bank money. Although the coalition Government have promised £3 billion, substantially more than anyone anticipated at the general election, to fund this new important piece of financial architecture in the City of London, which will make a substantial difference to our economy and drive green growth, that money can be spent only once. The key to the green investment bank priorities must be to address market failure. We cannot keep spending that money time after time. There are many demands on the green investment bank funding, and if the market, as we believe, is capable of supplying competitive interest rates in a way that is affordable to most consumers, supported by the ECO subsidy, it would be quite wrong to use green investment bank money when we clearly need to prioritise other areas of the low-carbon economy as well.

Likewise, as the hon. Lady can imagine, DECC is pushing for an ambitious ECO. This is a huge opportunity that is extremely cost-effective, and in terms of the hierarchy of spend on the low-carbon transition, the ECO represents incredibly good value, particularly compared with forms of low-carbon generation; but, again, the ECO comes out of consumers’ bills, and there is a balance to be struck. We cannot keep pushing up the ECO, because ultimately that will start to become regressive. When the coalition came into government, we took steps to reduce consumers’ bills by taking off the cost of funding the CCS programme and taking it into general taxation. We took measures to ensure that the renewable heat programme would be funded not through consumers’ bills but out of general taxation, and that is a progressive measure. We have to ensure that we get the right balance and have an ECO that is good for consumers and does the job. We cannot treat it as a magic pot of money. It is paid by every energy bill payer, and more than ever, as world energy prices go up, they are scrutinising bills to ensure that they are getting good value for money.

When the Minister says that he is pushing for a generous ECO, does he mean that he is pushing the Treasury to raise the cap that it has set on levies; that he is trying to ensure that the ECO is as generous as possible within the cap; that the ECO should remain outside the cap and therefore can be as large as he might wish to make it; or that the cap overall ought not to be referred further to the Office for National Statistics for a determination on whether the ECO is inside it at all?

All those issues are the subject of a constructive and thoughtful conversation between my Department and the Treasury.

The Minister has said that interest rates are just one element, and we have argued that it is integral and crucial to whether the green deal will deliver, not only because of the affordability of products—if the interest rate is 8% or more, very few products will fall within the golden rule, and if it is 6% or more, a few more will be added but some of the more ambitious measures would not be included—but most importantly because of public uptake. According to the Great British Refurb campaign study and polling of the public, just 7% of the public said that they would take up the green deal if the interest rate was 6% or more. The Government will not meet their ambition of reaching 14 million homes by 2020 if the interest rate is too high.

There will be a commercial consideration involved, because those matters are not lost on participants who want to carve out a large piece of what will be a substantial market. The interest rate is only one element of the cost. If the product bought is expensive, it does not matter if the interest rate is low. If a product is £1,000 and one is asked to pay an interest rate of 7%, would that be preferable to a product that costs £600 on which one pays 8%? There are many more variables than the absolute interest rate.

Customers will be looking for the absolute savings, taking into account the overall desirability of the package that they are being offered. The industry and new entrants will be looking at which of the levers they are most responsive to. I have no doubt that some companies will offer zero interest rate propositions. It is already possible to grab a sofa in the market and pay nothing until Easter or bank holiday Monday next year, and even then it may be with 0% finance. However, we know, because we are not stupid, that we invariably pay more in such offers than the actual price being offered. A sophisticated blend of different costs will be taken into consideration.

I understand what the hon. Member for Liverpool, Wavertree says, but ultimately consumers will want to know that the actual savings they make will be substantially greater than the cost of doing the green deal, and then of course they will want to unpick the green deal to ensure that they will get value right the way through the chain. Incidentally, I have here the latest draft of the new energy performance certificate, which I am really pleased with. It is still a work in progress, but I will happily share it offline with hon. Ladies and Gentlemen.

I think that the competitive market will be rather more sophisticated and will be able to fish out where consumers will look. I am not dismissing the hon. Lady’s claims. If borrowing is not available at competitive rates, that will clearly have an impact on the green deal, but our working assumption, which is based not on pie-in-the-sky figures formulated in DECC but on the detailed work done by our stakeholder working groups, with financial sector involvement and with my excellent officials, is that the interest rate, although challenging, will not be a barrier to successful take-up of the green deal.

We are obviously aware of the stakeholder groups and the consultations going on in DECC, but as far as I am aware only one or two consumer groups are involved, and the majority of organisations taking part in those discussions are businesses. None of the businesses I have spoken with has indicated that it will seek to present a 0% interest rate on its green deal package. Returning to the polling I just asked the Minister about, does he accept the polling from the Great British Refurb campaign, which indicates that only 7% of the British public would take up the green deal if the interest rate was 6% or more? All the organisations we have spoken with have indicated that the interest rate would be at that level or above.

I am afraid that the hon. Lady is wrong. We have a huge degree of engagement with consumer groups. All the obvious consumer groups have been involved heavily in formulating different parts of the green deal, and that work is ongoing. I have not seen the particular research she mentions, but we have certainly had involvement from Which?, Citizens Advice and Consumer Focus, as well as from sophisticated investors and institutions in the City of London. I do not expect offers to appear until October next year, and it is most unlikely that ambitious new entrants in the market will declare their hand so far in advance: they will wait to see how the market shapes up and look at their competitors before revealing their offers. That is my expectation, which is based on observing what else happens in the market, rather than on what stakeholders have said to me at DECC.

The Minister has explained candidly that the ECO is a regressive measure that will be imposed on general utility bill payers and that it will be an additional cost for them. He has also alluded to the fact that the Government removed the cost of carbon capture and storage from those bills on coming into office. Will he give an undertaking that the additional amount he proposes to impose on bill payers through the ECO will not be greater than what he and his Government have already taken off bill payers through their previous measures? He talks of securitisation in the bond markets, but will he explain how a default rate can be estimated, given his assertion that there will be no possibility of defaulting on that part of the bill?

The default rate will be the same as the standard default rate for electricity bills generally, which is a very low percentage. It is probably higher in the present economic circumstances, but when averaged out over a decade, it is very low compared with other instances, and it will not be extrapolated out of that. On the ECO, the hon. Gentleman seems to be trying to have his cake and eat it. The bottom line is that there is no magic source of money; it all has to come from somewhere and ultimately that is the taxpayer and the consumer, who are basically the same person in this context. We have to be very responsible and we are constantly looking for ways to lighten the load for hard-pressed consumers, who are concerned about rising energy costs.

We will publish in the autumn our expectations of how DECC policies, taken together, will impact on consumers through to 2020. The results of the early work are extremely encouraging. These things must be seen in the round—one strand of policy cannot be taken out as though it was part of a Woolworths pick ’n’ mix. We have to take the energy efficiency measures, the levies and our other measures to encourage greater competition in the energy sector as a whole. We will publish that in the autumn, when I am sure the hon. Gentleman will have an opportunity to quiz the Secretary of State.

The Minister rightly says that there is no magic pot of money, but there are certainly progressive and regressive ways of doing this. Does he agree that putting a levy on all consumer bills, irrespective of the financial situation of the householder, is inherently regressive? Indeed, the impact assessment of the 2009 extension of the carbon emissions reduction target showed that using a levy actually pushed more people into poverty than were pulled out as a result of the CERT money.

The hon. Lady makes an indisputable point. We are mindful of the mistakes made by the previous Labour Government, which resulted in a succession of levies being put on consumer bills without any thought to the long and short-term impact on the vulnerable. That is one reason why we saw such a steep rise in the number of people living in fuel poverty, which increased by millions during the last Parliament alone. It is a difficult balance to strike, and I can understand why Ministers took those decisions, because they had to find the money from somewhere. We are certainly very mindful of the point she raises, which is why, as the hon. Member for Brent North said earlier, we have taken steps to remove the levy for CCS and the renewable heat incentive levy from the bills. The Treasury will insist on clear value for money and due consideration of the impact on those who are least able to pay when we finally settle on the exact figure of the ECO, which will replace the CERT funding.

Amendment 27 tabled by the hon. Member for Brighton, Pavilion, and amendment 45 tabled by the hon. Member for Manchester, Withington, deal with the collection of green deal payments. Allowing either energy bill to be used to collect the green deal charge looks attractive. I asked the very same questions myself and got exactly the same initial response as the hon. Lady, but the devil is in the detail and close analysis reveals significant problems. Requiring gas suppliers as well as electricity suppliers to facilitate the collection of green deal charges, which seems the obvious thing to do, given that heating is the larger element, substantially increases the implementation costs.

I really pushed back on that in the early stages of policy implementation, but our findings indicate that it could increase the implementation costs by up to 50%, which would ultimately be passed on to consumers, mainly because most energy suppliers have separate gas and electricity billing systems. Introducing a choice between collection of the green deal charge via electricity or gas, however desirable—I am all in favour of greater consumer choice—would require regulating two groups of companies rather than one, which would increase the risk of implementation failure and potentially cause a delay to the launch of the green deal in autumn 2012. Auditing payment flows would also be more difficult, because there would then be two possible routes through which the funding might flow.

The idea of allowing the occupier of a property with a green deal plan to switch collection methods at any point also prompted considerable concern in the industry. It would increase the possibility of billing inaccuracies, which in extreme cases could increase disconnections, which I know we all want to avoid, as well as increase the overall risk premium and push up interest rates, which we obviously want to keep as low as possible. I will return in a minute to the issue of disconnection.

That leaves collection only by electricity or by gas; fundamentally, it comes down to an either/or situation. I agree with the hon. Member for Brighton, Pavilion that gas seems the obvious choice, but collection via gas bills would automatically exclude the possibility of billing in that way the 4.3 million households that are off the mains gas grid when they access green deal finance for energy efficiency measures. Many of those properties are in rural communities, and it is important to the coalition that the green deal be available to both rural and urban communities. In contrast, almost all properties in Great Britain are connected to the electricity grid.

The change proposed would also raise the possibility of customers paying summer gas bills that are significantly higher than those before the green deal plan was taken out, which could be very difficult for many low-income families who are prepayment customers and not used to paying large amounts on their gas bill over the summer months. Many breathe a sigh of relief as they reach spring and have that little extra give in the family budget as a result of not having constantly to load their gas prepayment meter. It would be most problematic for prepayment customers on gas, who would then be expected to carry on paying charges equally through the summer, when normally they do not.

We still have a lot more work to do to deal with the iniquity of billing, whereby people on prepayment meters and low incomes often end up paying a higher tariff, so for the foreseeable future it makes sense to ensure that the charge is levelled out across the electricity bill, where we see far fewer lumpy payments, spikes and troughs.

Does the Minister accept that, if we are really to reduce fuel poverty, we need to place the first units on the cheapest tariff, so that those who use least energy pay least for it, instead of, as happens now, their paying most for the first bundle and paying less the more they consume? They should pay least for the smallest amount and, as they increase their consumption, pay more per unit.

I am of course familiar with that argument of rising block tariffs, but that too has unintended consequences, which often hit pensioners in particular. However, I think I would be ruled out of order if I lurched into a discussion of tariffs, which are not necessarily the subject of the amendments before us.

We are left with collection via electricity bills as the only practical solution. The Government accept that that requires measures to strengthen the cognitive link between the green deal charge and energy savings, which in many cases will be realised on the gas bill. That is why the Government plan two requirements to increase the link between the two. First, for the 14.8 million households that receive their gas and electricity from the same supplier, the Government plan to introduce a requirement on energy suppliers to provide a combined energy bill, with the charges for gas and electricity supply and the green deal charge clearly identified on the front page. Secondly, the Government will introduce a requirement for electricity suppliers to reproduce the estimated savings from the green deal assessment on the green deal customer’s annual energy statement.

On the issue of disconnection, it is important that the green deal charge is treated in the same way as normal energy bill payments, so that defaults are kept to an absolute minimum and low-cost finance can be offered. I do not expect the green deal to increase disconnection, given the protection of the golden rule principle.

I shall give way to the hon. Lady, but then I really do need to make some progress so that we can get on to other parts of the Bill.

I am grateful to the Minister for stating the developments for those customers who have the same energy provider for their electricity and gas supply. He says there are 14.8 million of them, but my question, which came up in Committee, is about those customers who have different providers for electricity and for gas. What will happen to them? How will they be able to measure the savings across their two bills? My conversations with many energy providers tell me that their systems do not currently speak to each other, and that to make them to do so would cost a great deal.

There will be access to the energy annual statement, which will make that crystal clear.

Energy suppliers are already prohibited from disconnecting households in the winter months when they know or have reason to believe that the customer is a pensioner or lives with pensioners or with those under 18 years old. We plan to extend those protections to the non-payment of green deal charges.

We have had a very good debate. I have commented on the green investment bank to make clear the Government’s views on what appropriate interventions for the green investment bank would be. Although we understand the intention behind new clause 8, we will not support it. I hope that the hon. Member for Brighton, Pavilion is reassured by my explanation and will not press her amendments 26, 27, 49 and 50 or new clause 8; and that the hon. Member for Manchester, Withington and my hon. Friend the Member for Brigg and Goole are similarly reassured on amendment 28. I hope also that the hon. Member for Manchester, Withington found my explanation regarding amendment 45 equally compelling and will not press that, either. I urge the House to support Government amendments 29 to 34 and 36 and new clause 10.

Question put and agreed to.

New clause 10 accordingly read a Second time, and added to the Bill.

New Clause 11

Agreement about modifying decommissioning programme

‘(1) Section 46 of the Energy Act 2008 (approval of a decommissioning programme) is amended as follows.

(2) After subsection (3) insert—

“(3A) When approving a programme the Secretary of State may agree to exercise, or not to exercise, the section 48 power—

(a) in a particular manner;

(b) within a particular period.

(3B) An agreement under subsection (3A) may subsequently be amended by the Secretary of State and the other party to the agreement.

(3C) The Secretary of State may not make such an agreement or amend such an agreement unless satisfied that the agreement (or the agreement as amended) includes adequate provision for the modification of the programme in the event that the provision made by it for the technical matters (including the financing of the designated technical matters) ceases to be prudent.

(3D) Provision in such an agreement (including the provision mentioned in subsection (3C)) may include provision—

(a) for a determination by a third party in relation to a relevant matter specified in the agreement, and

(b) for the Secretary of State to be bound by such a determination.

(3E) A “relevant matter” is a matter relating to the provision made by the programme for the technical matters.

(3F) Subsections (3A) to (3D) apply notwithstanding that the agreement or amendment fetters the Secretary of State’s discretion.

(3G) In subsection (3A) “section 48 power” means the power of the Secretary of State under section 48 to propose a modification of the programme or a modification of the conditions to which the approval of the programme is subject.”

(3) In subsection (4) for “(3)” substitute “(3B)”.’.—(Charles Hendry.)

Brought up, and read the First time.

With this it will be convenient to discuss the following:

Amendment (a) to new clause11, line 5 leave out ‘, or not to exercise,’.

Amendment (b) to new clause 11, line 9 leave out

‘and the other party to the agreement’.

Amendment (c) to new clause 11, line 15 leave out ‘prudent.’ and insert

‘adequate to protect the interests of the public and taxpayers.’.

Government new clause 12—Adjustment of electricity transmission charges. Government new clause 13— Consultation.

New clause 17—Proposal for modification of approved programme—

‘(1) Section 48 of the Energy Act 2008 (approval of decommissioning programme) is amended as follows.

(2) In paragraph (2)(c) leave out “(provided that the site operator consents to the proposed modification)”.

(3) In subsection (3) leave out “, in particular,” and insert “only”.

(4) In paragraph (3)(a) leave out second “, or” and insert “.”.

(5) Leave out paragraph (3)(b).’.

Government amendments 35, 37, 38 and 39.

Amendment 51, page 93, line 33, in clause 115, leave out paragraph (a).

Government amendments 40 to 44.

We now move on to a series of technical and miscellaneous new clauses and amendments, which cover nuclear decommissioning transmission charging, the process of consultation and the Home Energy Conservation Act 1995 and how it applies in Scotland.

I shall first address the issue of the nuclear decommissioning programmes. In Committee, hon. Members raised concerns about how any agreement that sets out the manner in which the Secretary of State will, or will not, exercise his power to propose a modification to an approved programme will deal with “unforeseen circumstances” in the future. I have listened very carefully to hon. Members’ concerns, we have had very useful meetings and I am very grateful for the constructive way in which they have engaged to ensure that we have a new clause that is acceptable to both sides.

I recognise that the funded decommissioning programme and any agreement entered into under the new clause are very long-term arrangements, and that the arrangements will need to take account of “unforeseen circumstances” that may arise in the future.

In the light of the Committee’s concerns, we wish with new clause 11 to amend the relevant measure in order to require that the Secretary of State enter into an agreement only when he is satisfied that it includes adequate provision for the modification of a programme if the programme no longer secures prudent provision for the liabilities.

Let us be clear: we would not impose an additional test to the existing requirement that the Secretary of State must be satisfied that the programme and the agreement as a whole secure prudent provision for the liabilities. The new clause would make it explicit that, as part of ensuring prudent provision, the Secretary of State needed to be satisfied with the arrangements for making modifications to the programme when he entered into the agreement.

Will the Minister be a little more precise about the exact definition of the word “prudent” in this context?

We have chosen to use the word “prudent” not only because it is a concept that is established in law but because it was important to give the Secretary of State the ability to decide, in future, whether something has ceased to be prudent. We looked at some of the wording that had been discussed in Committee relating to unforeseen circumstances and moved away from that because we were concerned that the legal debate would then be about whether something was foreseen or unforeseen. If people could point to one speech by a Minister who had talked about such issues, then nobody could say that they were unforeseen because they had been discussed in this House. I will clarify that further in a few moments.

It is clear that over the years foreseen and, potentially, unforeseen events will occur that may require modification of the arrangements set out in the programme. The new clause is not limited to unforeseen circumstances, but when the Secretary of State enters the agreement he will need to be satisfied with the arrangements for modifying the programme when it is no longer prudent, be that in unforeseen circumstances or those which were foreseen. The new clause also allows the agreement to set out matters that may be determined by a third party, and for the Secretary of State, if he so agrees, to be bound by that determination. This provides reassurance to operators that there can be a mutually agreed and mutually binding process between the Secretary of State and the operator where disputes can be resolved in an impartial manner. Such a third party would need to be impartial and independent of the operator and the Secretary of State. In addition, both parties would need to be satisfied that the third party in question had the expertise to perform the role required of them. The exact terms of the agreement, including any process for third-party determination, and the method for appointing a third party will be decided on a case-by-case basis with the operator and after taking into account the programme submitted by that operator.

I turn now to amendments (a), (b) and (c) to new clause 11, which are in the name of the hon. Member for Brighton, Pavilion (Caroline Lucas). Under amendment (a), the Secretary of State would not be able to set out in the agreement when he would not use his section 48 power. This would leave him with broad scope to use his section 48 powers and so render the agreement ineffective from the perspective of providing investor confidence, which is the whole purpose. Amendment (b) would have the same effect. Amendment (c), which would omit the word “prudent” and insert

“adequate to protect the interests of the public and taxpayers”,

would not provide further protection for the taxpayer. Arguably, it would reduce protection by introducing a looser term that could be subject to conflicting interpretations and be inconsistent with the rest of the Act, for which the test is prudence.

New clause 17 would amend subsection (2)(c) of section 48 of the Energy Act 2008. That would have the effect of allowing others with obligations under the programme to propose modifications to a site operator’s programme without first seeking their consent. It is clearly unreasonable, we believe, to expect an operator to agree to this. In any case, the Secretary of State would need to seek the views of the site operator and take those views on board before deciding whether to approve the modification.

There is also a legal issue involved in the new clause. The effect of modifying subsection (3) of section 48 in this way would probably be exactly the opposite of what the hon. Member for Brighton, Pavilion intends. Under the Act, if it were amended as proposed, the Secretary of State would be able to impose obligations only on an associate of the operator and not the operator itself. Modifying subsection (3)(a) and removing subsection (3)(b) altogether would mean that obligations placed on an associate of the operator could not be removed even if, for example, those obligations were no longer relevant because they had been fulfilled. This is clearly inappropriate and impracticable. On that basis, I hope that the hon. Lady feels sufficiently reassured to withdraw the amendments.

I will now speak to Government new clauses 12, 41 and 44, which relate to transmission of renewable electricity and the role that renewable generators in peripheral parts of Great Britain could play in meeting low carbon energy targets. Section 185 of the Energy Act 2004 allows the Secretary of State to introduce a scheme adjusting transmission charges in a particular area of the country to help to mitigate any material hindrance to renewables development caused by these charges. Section 185 was introduced to address concerns that a GB-wide charging regime for the electricity transmission network might hinder the development of renewable generation in a particular area of the United Kingdom—for example, in the north of Scotland and the Scottish islands. Under the regime, transmission charges are cost-reflective. In effect, the further electricity has to travel, the higher the transmission charges.

Any scheme introduced under section 185 can be applied for up to 10 years—an initial period of no more than five years with renewal for up to five further years. Currently, any scheme must terminate by October 2024. The new clauses merely extend that time limit until 4 October 2034. This power has never been exercised, and it is possible that a review of the transmission charging regime currently being carried out by Ofgem under Project TransmiT will address any perceived problems in other ways. However, it is not certain that Ofgem’s review will address all such perceived problems in every case—for example, renewable generation on the Scottish islands, where forecast transmission charges are significantly higher than elsewhere in Great Britain. The lead times of proposed developments also mean that no renewable generators on the Scottish islands will be connected to the transmission network by October 2014, and so they would not be in a position to benefit from the full possible extent of any section 185 scheme. It therefore makes sense now to extend the sunset clause by 10 years to October 2034. This will allow maximum flexibility to take account of the outcome of Ofgem’s review and give developers time to bring forward renewable generation and associated transmission links without concerns of exceeding the current 2024 deadline.

Government amendments 43 and 51 relate to the Home Energy Conservation Act 1995. As hon. Members know, having listened to concerns raised during the passage of the Bill, the Government were convinced of the desirability of retaining HECA in England, and this was agreed in Committee on 21 June. Schedule 3 makes a number of amendments that were necessary when HECA was being repealed. However, with HECA being retained, the consequential amendments listed in schedule 3 are no longer necessary. Government amendment 43 is therefore a purely technical amendment that I hope raises no issues of concern for hon. Members.

Regarding amendment 51, I would like to reassure the hon. Members for Kilmarnock and Loudoun (Cathy Jamieson) and for Rutherglen and Hamilton West (Tom Greatrex) that we have fully consulted colleagues in the Scottish Government during the development and passage of the Bill. The intention to repeal HECA in Scotland was at the request of Scottish Ministers, who indicated that they believe that the Climate Change (Scotland) Act 2009, together with the local housing strategy guidance, will be sufficient to ensure appropriate promotion of energy efficiency and the opportunities that the green deal will bring to this. On that basis, I hope that the hon. Members can withdraw their amendment.

Will the Minister confirm that the repeal was part of the legislative competence motion passed by the Scottish Parliament?

The hon. Gentleman is absolutely right. This is a devolved matter that we have discussed with the Scottish Government. We are implementing this measure as the easiest and quickest way of delivering on that.

Finally, I refer to a small set of Government amendments regarding consultation—Government new clause 13 and consequential Government amendments 35, 37, 38 and 39. The purpose of the new clause is to ensure that consultation with key stakeholders carried out before, as well as after, Royal Assent can contribute towards fulfilling the various statutory consultation duties that arise under, or by virtue of, the Bill. Consulting stakeholders is an important part of developing and implementing any policy. Throughout the Bill, there are several provisions that impose a statutory requirement to consult before exercising powers to make secondary legislation. These include, for example, consultation with devolved Administrations or energy companies. In many cases, the consultation requirement can be satisfied by a consultation that takes place before, as well as after, the passing of the Bill. The new clause seeks to ensure parity of approach throughout the Bill.

I hope that I have assured hon. Members that the Government have listened during the passage of the Bill, and I urge them to support our amendments. Similarly, I hope that I have reassured them sufficiently that they feel able to withdraw their amendments.

I am seeking to amend new clause 11, which was based on a clause that was withdrawn by the Government in Committee because of cross-party concerns. I have not been fully reassured by what the Minister has said about the new clause, which has not met all those concerns. My amendments therefore seek to ensure that the Secretary of State cannot decide not to exercise his powers to modify a nuclear decommissioning programme; that a nuclear decommissioning programme can be modified only by the Secretary of State on his own, not working with an operator; and that we clarify what is meant by the word “prudent”. The Minister has helpfully expanded on that term so I feel a little reassured, although I still think that it is a little open.

In new clause 17, I am seeking to amend section 48 of the Energy Act 2008 to ensure that a third party to a nuclear decommissioning programme can propose a modification of it without the consent of the site operator. I make it very clear that it is still the Secretary of State alone who can modify it. I am not suggesting that the associate to the operator can do so. I suggest that they should be able to propose a modification, but that it remains the responsibility of the Secretary of State to decide whether to go ahead with that. I am also clear that changes should not include a reduction of the requirements.

We are not debating the pros and cons of nuclear power per se. The Minister knows very well that I am not a great fan of nuclear power. The debate is about whether the Government should be subsidising, more or less with a blank cheque, a nuclear renaissance in the UK, either directly or indirectly. Ministers know very well that the UK faces a £4 billion black hole in unavoidable nuclear decommissioning and waste costs, which the Secretary of State revealed soon after coming to office last year. At that time, he said the crisis was such that

“my department is not so much the department of energy and climate change, as the department of nuclear legacy and bits of other things”.

It was well reported at the time that there would be additional costs from rising expenditure on nuclear decommissioning and falling income due to the closure of ageing power plants. The Secretary of State went on to insist:

“I do not think it is possible for anyone responsibly to stand aside and say we are not going to deal with it. We just have to, but what we are effectively paying for here is decades of cheap nuclear electricity for which we have suddenly got a massive postdated bill.”

I could not have put it better myself. What clearer evidence of the long-term subsidy of nuclear power could there be?

It is not clear to me how Government new clause 11 will seriously address this problem. By limiting the Secretary of State’s power to place greater responsibility on a nuclear operator to meet the costs of decommissioning its plants, the new clause could even make the situation worse. It is because of the unpredictable nature of nuclear clean-ups and decommissioning that the Secretary of State must retain the option of adding to the liabilities of companies such as EDF, which boldly lobbied Committee members in support of the original clause 102.

Of course, the cost of an accident could be even higher than the cost of planned decommissioning. The Financial Times reported in April that Toshiba and GE Hitachi have both submitted proposals to clean up and decommission the Fukushima site on the basis that the process is likely to cost billions of dollars. The German Government’s estimate for a severe accident such as the one at Fukushima is €1 trillion. These are unimaginable figures. As a result, there are serious ongoing discussions about the need to raise the EU and UK’s nuclear accident liabilities ceiling from €143 million to €1 billion. As one can see, that still falls well short of the total cost.

I believe that limiting the Government’s power to introduce greater demands on nuclear power companies to cover higher decommissioning requirements could place greater financial burdens on taxpayers and amount to a back-door subsidy for nuclear. The Minister may say that such agreements could still be added under new clause 11. Although that might be technically true, a nuclear operator agreeing to add to its own responsibility for contingency or cost would be a classic case of turkeys voting for Christmas—it would be very unlikely to happen.

I tabled my amendments because I want the Secretary of State to retain the power to modify a decommissioning agreement on his or her own, without requiring the agreement of a plant operator. I also want to ensure that a decommissioning agreement can be modified only to ensure that obligations are added, not removed.

I will make a few remarks about amendment 51.

This will perhaps be a rare moment of solidarity with Ministers, as I welcome the position that they have taken on the Home Energy Conservation Act 1995 as it applies to England. The Minister has moved on this issue since the publication of the Bill to retain the statutory provision requiring local authorities to report on their activity with regard to climate change in England. The Minister gave a strong statement on that. I will focus on the importance of the statutory provision.

The situation in Scotland will, of course, be somewhat different if HECA is repealed. I am well aware of the legislative consent motion that was passed in the Scottish Parliament in December 2010. I have no wish to suggest that the Scottish Parliament should not have responsibility for those matters, which are devolved.

In the Public Bill Committee in June 2011, the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker) made the following statement, which has been reinforced today:

“After we consulted the Scottish and Welsh Administrations, they asked that we continue with the repeal of HECA on their behalf, so it will not apply in Scotland and Wales. The devolved Administrations will, however, continue to work with their local authorities to progress the national energy saving initiatives that they already have in place.”––[Official Report, Energy Public Bill Committee, 21 June 2011; c. 366-367.]

I raise this issue today because some of the energy conservation agencies and environmental lobby groups in Scotland are concerned that what has been put in place in Scotland does not meet the test that statutory guidance would have brought, because the new approach uses voluntary arrangements. While I again put it on the record that the Minister chose to continue the respect agenda for the devolved Administrations, I have some concerns that the Scottish Government and the Scottish Parliament have not fully understood what they need to do to ensure that local authorities continue to act appropriately.

The supplementary guidance on addressing climate change through local housing strategies was last issued by the Scottish Government in March 2011. That guidance accepts that since 1995, the main legislative instrument for addressing energy efficiency has been HECA, which placed a duty on local authorities to set out and report on energy conservation measures in residential accommodation in their areas.

Under HECA, councils have taken a wide range of initiatives to improve the energy efficiency of housing stock in their areas. For example, Glasgow city council developed a comprehensive strategy that included funding programmes, technical assessment tools and staff training programmes. As a result, the council reported that over the 10-year period since HECA was introduced, it achieved reductions of 30.4% in the total energy consumption of housing in its area and a 32% reduction in CO2 emissions.

The guidance from the Scottish Government states:

“While the progress made by local authorities in reducing emissions under HECA is recognised, in line with a commitment to reduce local authority reporting requirements the Scottish Government and COSLA have agreed that councils should no longer be required to report under the Act, and that instead they will address energy efficiency planning/greenhouse gas emission reduction within their Local Housing Strategies, and where relevant, in Single Outcome Agreements.”

Essentially, what has happened in Scotland is that there has been no statutory provision and that has been replaced by the use of single outcome agreements. For right hon. and hon. Members who are not aware, those are non-binding agreements that the Scottish Government sign up to with each of the 32 local authorities, if indeed one can sign up to a non-binding agreement. Instead of local authorities being required to report, there is now voluntary guidance and a take-it-or-leave-it approach. One can see why some agencies are concerned.

Some of the areas that the Scottish Government, with all due respect to them, thought would be included in the local authorities’ single outcome agreements, perhaps because there was passing mention of them, such as class sizes, teacher numbers and the sale of playing fields, have proved simply to have been warm words, rather than things that were achieved.

Recently, the Scottish Government raised the issue of the future of HECA in their consultation on the energy efficiency action plan. There were a fairly small number of responses—only 28 in total. The majority of those understood that it was time to change HECA and wanted to replace it with a duty on local authorities to report on energy efficiency.

That brings us to amendment 51, which would keep the statutory provision for which HECA provides. I listened carefully to the Minister and I am sure that other Members from Scottish constituencies will have their own views on this. Perhaps it is time to update or replace HECA, as some people argue. I do have concerns about what has happened in Scotland. However, I have no wish to divide the House on this matter as I do not think that that would be helpful at this time. None the less, it is important to put the matter on the record.

Ongoing monitoring of strategies that will improve energy efficiency, reduce emissions and increase resilience to the consequences of climate change in the housing sector should be a priority in Scotland. I therefore hope that my former colleagues in the Scottish Parliament, and indeed the Scottish Government, who I am sure will be avid watchers of this debate, recognise that although they have gone a considerable way in the Climate Change (Scotland) Act 2009 and the voluntary guidance, they should none the less consider the issue again. The Scottish Government should recognise that the UK Government have listened to their request to remove HECA, take their responsibilities seriously, and look at reintroducing statutory provision in Scotland.

I love it when we get to technical and miscellaneous amendments. They sound innocuous, but, as the Minister knows, there is a great deal of meat within the details—it is the sort of stuff that we love to agonise over. As we heard from both the hon. Member for Brighton, Pavilion (Caroline Lucas) and my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson), there are substantive issues within these proposals.

I shall turn my attention purely to one proposal—we support the Government’s proposals—because I want to pay the Minister and his team some compliments. In respect of Government new clause 11, there was a great deal of debate in Committee on the necessary balance to be struck between certainty for the investor community, and—this is paramount—protection for the taxpayer against the foreseen and unforeseen costs of decommissioning. After a great deal of debate and encouragement from the Committee, the Minister, quite worthily, agreed to remove his measure from the Bill and went away to discuss the options that he could bring back to the House.

I thank the Minister for the way in which he has engaged with Committee members and others, including my hon. Friend the Member for Southampton, Test (Dr Whitehead)—I must single him out. Some of his ideas, including on third-party engagement, have contributed significantly to the ideas behind, if not the drafting of, new clause 11.

The new clause is not perfect, and it never will be, but it makes a very good fist of striking the right balance between looking after the needs of different stakeholders, and—I say this categorically—ensuring that we protect taxpayers. I look forward to the Minister’s response to the remarks of the hon. Member for Brighton, Pavilion, because she made some interesting points. I think the Minister has explained very well the use of the word “prudent”, but I am sure that he will address that and other issues that have been raised.

I thank the Minister, because this is how a Bill should evolve—through constructive engagement. Ministers should take measures away, think about them and listen to all the ideas on the table. He has come back with something that might not be perfect, but it is a massive improvement, on which he and his team are to be congratulated.

I agree with my hon. Friend the Member for Brighton, Pavilion (Caroline Lucas) on nuclear power, which probably does not come as a great surprise to the Minister. I have nothing to add to what she said, because she made her case very well indeed.

I am glad to be able to support Government new clause 12, on transmission charges. It is a very sensible change. I await with interest the outcome of Operation TransmiT. Will Ofgem finally see sense and deal with transmission charges? I am not overburdened with confidence that it will do so, but one lives in hope.

I want to address the points that the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) made about the Home Energy Conservation Act 1995. I received a briefing on that from Friends of the Earth, the World Wide Fund for Nature, and the Association for the Conservation of Energy. I would normally be favourable towards those organisations, but I was not impressed by their briefing, which does not give a reason, other than an emotional one, on why HECA should not be repealed.

Very fairly, the hon. Lady said only that some organisations opposed the repeal of HECA, because some do not. Energy Action Scotland, for example, is much less convinced of HECA’s worth. That is the crux of the matter. She and I probably want to get to the same place, and my argument should be seen not as a political one, but one about the methods of getting there.

As I understand it, the Scottish Government want the repeal of HECA simply because they feel that it did not deliver. HECA places a duty on local authorities to set targets, but nothing over and above that. Out of the 32 local authorities in Scotland, only nine have set targets in the 16 years that HECA has been in operation. Despite the fact that the briefing I received describes HECA as the “main driver” for local authority action on energy saving over the past 15 years, the fact that so few local authorities set targets suggests that it was not particularly effective.

One concern is that even if statutory provision did not act as a driver, a purely voluntary code of guidance would lead to local authorities putting energy saving even further down their list of priorities. Does the hon. Gentleman agree that it is important that the Scottish Government consider how to ensure that targets are set and delivered?

I agree that it is important that targets are set and delivered, but I do not agree that energy saving would necessarily be a lower priority under the guidance system, and I shall explain something about that. As the hon. Lady will know, the Scottish Parliament has often taken a different road from the UK Parliament—the central heating scheme is a classic illustration. Both the previous Administration in Scotland and the current Scottish National party Administration have taken different routes from the UK Government to deal with those matters.

The Scottish Government have decided that they will focus their efforts on each local authority’s housing strategy. As the hon. Lady rightly says, guidance has been issued. They are seeking to make it clear that that strategy and guidance are the driving force behind determining levels of investment in each local authority area—I believe that a significant piece of work was done in the highlands and islands on that basis.

The Scottish Government have also introduced Scottish housing quality standards, which every local authority and housing association must achieve by 2015, and for which an additional £1.5 billion will be spent over the next three years. In a recent case in my constituency, there was a difficulty with lack of insulation, and I took that up with the housing association. It is clear that it is very much aware of the need to react to the 2015 standard. I hope that that problem is resolved before the onset of winter, although time is running out.

The standard has already been achieved in 40% of housing in Scotland. There is still a long way to go, but that is a significant achievement. The standard assessment procedure rating achieved is 7, so clearly the standard is delivering what is necessary in those houses—it is much more effective than HECA in doing so.

In addition, the Scottish Parliament has passed the Climate Change (Scotland) Act 2009, which is acknowledged as world-leading legislation. The Act will drive much of what is done in Scotland. The £33 million energy assistance package has helped 150,000 people on low incomes to reduce their bills since 2009. One in six Scottish homes—a total of 145,000—have been visited for a home energy check, and there have been almost 18,000 installations. The EAP has been extended to help the most vulnerable. In addition to helping pensioners, the scheme has been extended to include disabled families with children under five, disabled children under 16, those with severe disabilities, and those who are terminally ill. The £50 million warm homes fund will also be introduced to help.

In addition to the EAP, the Scottish Government are providing £12.5 million in 2011-12 to support local councils to deliver area-based insulation to save households money, reduce emissions and tackle fuel poverty. It is hoped that councils will target areas across the country that are most in need of free insulation and other energy efficiency measures. The Scottish Government are working with local authorities to help to target the areas that are most in need, which is very much welcomed by Energy Action Scotland.

I am pleased to hear that the hon. Member for Kilmarnock and Loudoun will not press amendment 51 to a Division, but I ask hon. Members to realise that Scotland is doing things differently. In many ways, HECA has been overtaken by events in Scotland, which is why the Scottish Government want it repealed. They want repeal not because of a desire to avoid the implications of HECA, but because they have moved in another direction. Interestingly, the Scottish Government and the Labour Government in Wales have taken a similar view. We might be going in different directions, but I hope that we are all going towards the same goal of making our homes warmer and eradicating fuel poverty among our populations.

I want to comment briefly on new clause 11 and, in doing so, echo the remarks of my hon. Friend the Member for Ogmore (Huw Irranca-Davies). With hindsight, it has been recognised that the clause concerned, which was originally pretty flawed, has been substantially strengthened and clarified as a result of its withdrawal, the discussions that followed and its emergence on Report as new clause 11. In Committee, widespread concern was expressed about that flawed clause on the grounds that it sought to replace an arrangement under the Energy Act 2008 that enabled the Secretary of State unilaterally to invoke sections 48 and 49 of the Act for the modification of a decommissioning programme regardless of any agreement made previously.

The original clause would have replaced that provision with an arrangement that appeared to enable the Secretary of State to waive the ability to make programme modifications, if circumstances changed, by making an agreement when the licensing agreement was first adopted binding him or herself in perpetuity regardless of the objective circumstances in place after the original agreement. That was clearly not satisfactory. I accept that, for logical reasons, it is difficult to place the words “unforeseen circumstances” in legislation—clearly we do not know what those would be—but I think that the question of when a programme ceases to become prudent could be better addressed.

I would be grateful if the Minister clarified a couple of issues relating to the wording of the new clause that might be referred to should a modification action be undertaken by people seeking to understand what the clause really means. I appreciate that, as I have mentioned previously, the background to the new clause is similar to the Marx brothers’ form-guide sketch in “A Day at the Races” in which they have to refer to a large number of separate documents to understand where they were in the first place. Nevertheless, I would be grateful if he confirmed that the Secretary of State may act, by him or herself, to point out that a decommissioning programme subject to the new clause had ceased to be prudent and say, “It appears to me that this programme has become imprudent and therefore needs modification.”

What those modifications might consist of would be a matter for negotiation and discussion with the site licensee. If points in the modification programme could not be agreed, a third party could come in, under proposed new subsection (3D), to determine how those points might best be resolved. When the third party—as the Minister emphasised, it would be an independent party—has resolved those previously unresolved issues, the Secretary of State would, under the proposed new subsection, be

“bound by such a determination”.

It is clear, however, that under administrative law the Secretary of State would not be able to undertake an agreement unless he was satisfied that there was adequate provision for the modification of the programme, including the understanding that the site licensee would also be bound by what the third party had determined.

It would not be logical or reasonable for the Secretary of State to undertake a programme that would enable the licensee to escape being bound by the consequences of a determination of modification and therefore simply not undertake any action relating to those modifications, even after they had been agreed. That is my understanding of the new clause. I would be grateful if the Minister confirmed that and placed it on the record that the process would lead to an agreed modification programme that could be instituted by the Secretary of State, but mediated by a third party, after a programme had been judged to be no longer prudent on a different programme of decommissioning.

I am grateful to hon. Members for participating in the debate. I was surprised by how many of them paid tribute to the Government for listening so hard and making changes—I almost started to wonder whether we had done too much of it. Nevertheless, we remain firmly of the view that the Bill is better as a result of the changes made. I give particular credit to the hon. Member for Southampton, Test (Dr Whitehead) for his work with the hon. Member for Ogmore (Huw Irranca-Davies), and I thank them both for their constructive engagement in getting us to where we are, which, as I said, is better than where we started. It is perhaps an early birthday present for the hon. Member for Southampton, Test—I believe that his birthday is tomorrow—and the House can celebrate by recognising his contribution.

I am grateful to the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) for her comments about the changes that we have made to HECA. Listening to the discussions on the Opposition Benches about how best to address these matters in Scotland, I felt like we were intruding on family grief. However, I have no intention of doing that because they are matters that will properly be resolved by the Scottish Government. Nevertheless, we have to accept that the legislative consent motion is essentially an on/off switch. One either has to have HECA or get rid of it; one cannot have a little bit of HECA or have a different element within it. My understanding from our discussions is that the Scottish Government want to address these issues differently, using different mechanisms. We absolutely respect their right to make those decisions, and the changes in the Bill will simply make that possible.

The bulk of this debate inevitably focused on the nuclear clauses. The hon. Members for Brighton, Pavilion (Caroline Lucas), for Angus (Mr Weir) and I will never agree on the principles of nuclear, but we all want to make sure that if nuclear power stations are built in the United Kingdom, that should be genuinely without subsidy and we should have extremely strict controls on decommissioning, safety and a range of other issues.

There is also a fundamental disagreement between us. We recognise that if investors are to have confidence in the decommissioning programmes, they must feel certain that those programmes cannot be changed at will or on a whim by the Secretary of State at some subsequent date. That was the flaw in the earlier legislation, which we are trying to address. It gave a power at any time for the then Secretary of State to say, “We’re going to change these rules,” and there would have been no right for a company which thought it had a commitment and an agreed programme to resist that. What we sought to do, and what I hope we have achieved, is to agree the right balance between the powers of the Secretary of State and the guarantees and undertakings necessary for the companies involved.

If the liabilities are fixed so that uncertain messages are not being given to the investors, but the costs rise in an unforeseen manner, how is that not a subsidy if the person who is going to meet the difference between the liabilities and the real cost is not the taxpayer?

The hon. Lady raises an entirely separate issue. A funded decommissioning programme is constantly reviewed. If there is evidence that not enough money has been put aside for decommissioning issues, that money will have to be increased. The operators entirely accept that if the costs rise, they will have to contribute more towards the decommissioning pot. The new clause is about whether the Secretary of State should be able to say, “You know, I’ve decided that rather than you putting that money into a pot over 20 years, I’d like it in 12 months.” That would be a fundamental change which, under the existing legislation, the companies would not have been able to challenge. There will be no change in the measures ensuring that enough money is put into the decommissioning pot. If that goes up or down, the amount put in will have to reflect that. That is not touched in any way by the changes that we are making through the Bill.

On the hon. Lady’s new clause 17, at present anybody can write to me as a Minister and say, “We don’t think this is adequate,” and we will consider that. That, as she says, would not be a legal power, but an advisory power. It would still be for the Secretary of State to decide whether to take it forward. The Secretary of State has a number of choices. He can choose to modify, to modify in part or to take no action, so considerable power rests with him.

That comes to the heart of the questions that we were asked by the hon. Member for Southampton, Test. There is something vaguely Rumsfeldian about the concept of unforeseen. What are foreseen unforeseen circumstances and what are unforeseen unforeseen circumstances? I think we have been wise to move away from that. A prudence test is a better one, which both Government and industry are more comfortable with. The Secretary of State will have the power to make those decisions, but we will also make clear in those programmes the role of the third parties.

We have had a considerable amount of discussion with the hon. Gentleman about the nature of those third parties. It would clearly have to be somebody who was acceptable both to the Government and to the operators and who was not prejudiced towards one side or the other. That is a role that the Government are used to developing. The Secretary of State would have significant powers but there would also be a role for third parties. Critically, the Government and the operator would be bound by the decision of the third party. This gives the extra degree of certainty and comfort that the hon. Gentleman sought. I hope we have been able to reassure him.

We have had a useful exchange. I thank the official Opposition for the constructive way in which they have engaged with the issue, so that the nuclear aspects of the Bill are stronger and more effective than they were before.

Question put and agreed to.

New clause 11 accordingly read a Second time, and added to the Bill.

New Clause 12

Adjustment of electricity transmission charges

‘In section 185(11) of the Energy Act 2004 (areas suitable for renewable electricity generation: end date for schemes adjusting transmission charges) for “2024” substitute “2034”.’.—(Charles Hendry.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 13

Consultation

‘A requirement for the Secretary of State to consult which arises under or by virtue of this Act may be satisfied by consultation before, as well as consultation after, the passing of this Act.’.—(Charles Hendry.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 1

Energy efficiency aim

‘(1) The principal purpose of this Part is to deliver energy savings from the building stock which will make commensurate contributions to—

(a) the fulfilment by the Secretary of State of the duties under section 1(1) (reduction of net UK carbon account by 2050) and section 4(1)(b)(carbon budgets) of the Climate Change Act 2008; and

(b) the elimination of fuel poverty by the target date required by section 2(2)(d) of the Warm Homes and Energy Conservation Act 2000.

(2) In performing functions under this Part the Secretary of State will have regard to—

(a) the principal purpose set out in subsection (1) above, and

(b) the recommendations from time to time of the Committee on Climate Change where these are adopted by the Secretary of State.’.—(Luciana Berger.)

Brought up, and read the First time.

With this it will be convenient to discuss the following:

New clause 2—Duty of the Secretary of State to improve energy efficiency

‘(1) The Secretary of State must prepare and publish a plan for achieving the principal purpose set out in section [Energy efficiency aim] in England.

(2) The plan must establish specific aims and describe the proposed means of achieving them, together with methods of reporting on progress towards meeting them.

(3) Where an aim is designated under this section, the Secretary of State must take all reasonable steps to achieve the aim.

(4) The plan prepared under subsection (1) must be published no later the 12 months after the day on which this section comes into force.

(5) The Secretary of State must, as soon as reasonably practicable after publishing a plan under this section lay it before Parliament.

(6) The Secretary of State must, within one year of each order setting a carbon budget under section 8(1) of the Climate Change Act 2008, review the plan prepared and published under this section.

(7) Where, following a review under subsection (6), the Secretary of State varies the plan, he must, as soon as reasonably practicable after so doing, publish the plan as so varied.’.

New clause 3—Carbon emissions in local authority areas

‘(1) Within 12 months of this Bill receiving Royal Assent the Committee on Climate Change shall advise the Secretary of State about—

(a) the scale of action needed in local authority areas to help meet UK Climate Change Act carbon budgets;

(b) climate mitigation and adaptation policies that are effective when locally co-ordinated by councils.

(2) The advice given under subsection (1) should include but not be limited to—

(a) carbon emissions from a local authority’s own buildings and operations;

(b) carbon emissions from the local area;

(c) local renewable energy generation;

(d) national carbon reduction initiatives delivered at the local level

(3) The Committee on Climate Change may advise the Secretary of State on local level adaption to climate change to ensure that individual local carbon budgets are both appropriate for the circumstances of different local areas that the totality of all local carbon budgets is consistent with the requirements of subsection (1)(a).

(4) The Secretary of State must lay before Parliament a response to the advice given by the Committee on Climate Change under subsection (1) or (2), within six months of receiving the advice.

(5) For the purposes of this section—

(a) “budgetary period”, “carbon budget” and “national authorities” have the same meaning as in Part 1 of the Climate Change Act 2008;

(b) “local authority” means a county council or district council in England, or a London borough council, or the Council of Isles of Scilly.’.

New clause 4—Climate change strategy for local authority areas

‘(1) Local authorities must develop and promote a climate change strategy for their local area.

(2) In preparing the strategy, local authorities must take into account any advice given by the Committee on Climate Change on local action to meet carbon budgets.

(3) In preparing the strategy, local authorities must consult with local residents, businesses, social enterprises and co-operatives and other institutions.

(4) Local authorities must publish and promote their local climate change strategy, publish an annual report on progress towards carrying out the strategy and engage with local citizens and community groups.

(5) The Secretary of State must work with local authorities and the Local Government Association to assist them in producing and implementing their climate change strategies, taking into account any relevant advice from the Committee on Climate Change.’.

New clause 7—Supplementing the Energy Company Obligation

‘(1) The Secretary of State must, within six months of this Bill receiving Royal Assent, report to Parliament with proposals on the ways in which the Energy Company Obligation could be supplemented by—

(a) revenues from the European Emissions Trading Scheme;

(b) revenues from the Carbon Floor Price;

(c) an additional tax on the profits of gas transporters and suppliers, and electricity generators, distributors and suppliers; and

(d) such other funds as the Secretary of State considers appropriate.

(2) In considering the supplement to the Energy Company Obligation that may be made by the sources of funds listed in section (1) the Secretary of State must include an estimate of—

(a) the extent to which the additional sources of funds listed in subsection (1) could increase the contribution made by a carbon emissions reduction target and a home-heating target to meeting—

(i) the carbon budgets established under the Climate Change Act 2008; and

(ii) the fuel poverty target established under the Warm Homes and Energy Conservation Act 2000.

(b) the extent to which the additional sources of funds listed in subsection (1) could allow the Secretary of State to increase the level of a carbon emissions reduction target and a home-heating cost reduction target without increasing the cost of household gas or electricity bills.

(3) The proposals reported under subsection (1) of this Clause must include an assessment of the extent to which the Energy Company Obligation could make a greater contribution to—

(a) the carbon budgets established under the Climate Change Act 2008, and

(b) the fuel poverty target established under the Warm Homes and Energy Conservation Act 2000

if charges levied on consumers’ bills under this obligation were levied on a per kilowatt hour basis.

(4) The assessment made under subsection (3) must take into account the effect on equity for those living in fuel poverty of levying charges on consumer bills under the Energy Company Obligation on a per kilowatt hour basis.’.

New clause 18—Disclosure of information for the purpose of reducing fuel poverty

‘(1) The Secretary of State may by regulations make provision authorising the Secretary of State, or a person providing services to the Secretary of State, to supply relevant persons with social security and tax credit information about persons in receipt of welfare benefits.

(2) In this section “relevant person” means—

(a) a person who holds a licence under section 6(1)(d) of the Electricity Act 1989 (c. 29) or section 7A(1) of the Gas Act 1986 (c. 44) (supply of electricity or gas to premises), or

(b) a person providing services to the Secretary of State or to a person within paragraph (a).

(3) Regulations under this section must specify the purposes for which information may be supplied by virtue of subsection (1), which must be purposes in connection with reducing fuel poverty or making homes more energy efficient.

(4) Regulations under this section may authorise the supply of information by a relevant person to the Secretary of State or another relevant person—

(a) for the purpose of determining what information is to be supplied by virtue of subsection (1), or

(b) to enable information supplied to a relevant person by virtue of subsection (1) to be used by that or another relevant person for purposes within subsection (3).

(5) Regulations under this section may—

(a) make provision as to the use or disclosure of information supplied under the regulations (including provision creating criminal offences);

(b) provide for the recovery by the Secretary of State of costs incurred in connection with the supply or use of information under the regulations.

(6) In this section—

(a) “social security information” means information held by or on behalf of the Secretary of State and obtained as a result of, or for the purpose of, the exercise of the Secretary of State’s functions in relation to social security;

(b) “tax credit information” means information held by or on behalf of the Secretary of State and obtained as a result of, or for the purpose of, the exercise of the Secretary of State’s functions in relation to tax credits;

(c) “welfare benefit” means any prescribed benefit, allowance, payment or credit.’.

New clause 19—Additional information provided by energy suppliers

‘The Secretary of State shall make provision for energy suppliers to—

(a) ensure a generic signpost message is displayed prominently on all customer bills from 1 December 2011, detailing how customers may be able to reduce their energy bills,

(b) ensure a letter reaches all of their customers by 1 December 2011, clearly detailing the extent to which customers overpay or underpay compared to that supplier’s cheapest standard direct debit tariff,

(c) implement, by 1 December 2012, the findings of research undertaken on the efficacy of—

(i) a generic signpost message, to be displayed prominently on customers’ bills;

(ii) a more detailed message, quoting pounds saved depending on payment method and tariff, as influenced by the customer’s actual usage over a 12-month period where appropriate;

in encouraging customers to switch to that supplier’s cheapest standard tariff available.’.

Amendment 2, in clause 42, page 27, line 37, after ‘landlord’, insert ‘, or his appointed agent,’.

Amendment 3, page 28, line 4, after ‘may not let’, insert

‘, let on behalf of the landlord as his appointed agent or market to let’.

Amendment 4, page 28, line 7, at end insert

‘such that the property shall not fall below the level of energy efficiency specified in subsection (1 )(c).’.

Amendment 5, page 28, line 13, after ‘“let the property”’, insert ‘and “market to let”’.

Amendment 19, page 28, line 31, at end insert—

‘(5A) The first domestic energy efficiency regulations shall be made no later than 30 September 2012.’.

Amendment 47, page 28, line 33, leave out ‘April 2018’ and insert ‘January 2016’.

Amendment 6, page 28, line 33, leave out ‘2018’ and insert ‘2016’.

Amendment 48, in clause 45, page 30, line 36, leave out ‘April 2016’ and insert ‘January 2013’.

Amendment 7, page 30, line 36, leave out ‘2016’ and insert ‘2013’.

Amendment 8, in clause 46, page 31, line 4, at end insert—

‘(e) any protections to be afforded to a tenant making a request under the regulations, including, if the Secretary of State considers it appropriate, the circumstances in which no notice under section 21(1)(b) or (4) of the Housing Act 1988 may be given pending the outcome of the request.

‘(1A) In determining whether it is appropriate to make provision under subsection (1)(e), the Secretary of State shall take into account the advice of any relevant body or bodies.’.

Amendment 24, in clause 70, page 52, line 28, at end insert—

‘(ab) to publish a report setting out the intended impact of a carbon emissions reduction order or a home-heating cost reduction order on fuel poverty and on the energy efficiency of domestic properties of different tenures.’.

Amendment 25, in clause 73, page 55, line 11, at end insert—

‘(2A) The Secretary of State may in addition require the register referred to in subsection (1) to record information on—

(a) the tenure of each property; and

(b) in the case of a domestic PR property, the name and address of the landlord.’.

Amendment 23, in clause 74, page 55, line 43, at end insert—

‘(2A) The Secretary of State may in addition require the register referred to in subsection (1) to record information on—

(a) the tenure of each property; and

(b) in the case of a domestic PR property, the name and address of the landlord.’.

Amendment 1, in clause 107, page 88, line 33, after subsection (1) insert—

‘(1A) In setting out the extent to which the green deal plans under Chapter 1 of Part 1 and energy company obligations have contributed to the Secretary of State fulfilling the duty under section 4(1)(b) of the Climate Change Act 2008 (carbon budgeting), the Secretary of State must if necessary explain why the appropriate contribution has not been made and the additional measures he will bring forward.’.

Amendment 9, in clause 108, page 89, line 6, leave out ‘residential accommodation’ and insert ‘buildings’.

Amendment 10, page 89, line 8, at end insert

‘in such a way as to ensure that the energy efficiency of buildings makes its optimal contribution to the delivery of a low carbon energy system at least cost.’.

Amendment 11, page 89, line 9, leave out subsection (2) and insert—

‘( ) In subsection (1) “energy system” means the production, transmission, distribution, storage and consumption of energy.’.

Amendment 12, page 89, line 14, at end insert—

‘(5) The Secretary of State must within 12 months of the passing of this Act publish a report on the steps that he has taken and proposes to take to discharge his duty under subsection (1).’.

Amendment 21, page 89, line 14, at end insert—

‘(5) For the purpose of assisting the Secretary of State to fulfil his duty pursuant to this section, each energy conservation authority must—

(a) take reasonable steps to increase the installation of energy efficiency improvements in residential accommodation in its area;

(b) involve persons and communities in its area in seeking to increase the installation of energy efficiency improvements in its area; and

(c) include a description of the steps it has taken pursuant to this section in its report pursuant to section 2 of the Home Energy Conservation Act 1995.

(6) An energy conservation authority must also consider whether, as a means of assisting the Secretary of State to fulfil his duty pursuant to the Climate Change Act 2008, it would be cost effective to draw up a sustainable energy plan for its area.

(7) In this section—

(a) “energy conservation authority” has the same meaning as in the Home Energy Conservation Act 1995;

(b) “energy efficiency improvements” are such measures as are specified by section 2(4), (5) and (6) of this Act; and

(c) “a sustainable energy plan” is a plan promoting energy from sustainable or renewable sources.’.

With so many households struggling under the weight of increased energy bills and fuel poverty at record levels, improving the energy efficiency of our nation’s building stock and reducing our energy use has never been more important. A successful green deal scheme would offer protection to worried consumers hit by unfair gas and electricity price rises and reduce our country’s damaging carbon emissions. As they stand, however, the Government’s proposals lack detail, fail to provide clarity to businesses and risk being inadequate. The new clauses and amendments that we have tabled for debate today seek to rectify the Bill’s weaknesses.

Since the Bill was first published last December, we have endeavoured to work constructively with Ministers to improve the proposals, not just because the green deal was born out of pilots begun under Labour in government, but because we recognise the urgent need to improve energy efficiency across our country. We are disappointed that the Bill did not receive Royal Assent before the summer recess, as the Government promised it would. Meeting that deadline was used by Ministers as a justification for expediting debate during the Bill’s previous stages. In addition, the large volume of secondary legislation involved calls into question whether the green deal will be up and running by October next year, which has been set as the Government’s deadline.

We offered a raft of proposals in Committee to increase consumer protection, boost small businesses and provide extra support for those struggling to heat their homes. Our vision of the green deal is one where co-operatives, small businesses, charities and social enterprises can compete equally alongside large companies that want to take part in the scheme. Our vision is of a scheme that supports Britain’s 2 million small businesses, rather than simply leaving them with warm words and empty order books, which is what the Government risk doing. The Government voted against our vision, although I am delighted that Ministers did not oppose our proposal for a green deal apprenticeship scheme. I assure the Minister that all of us on the Labour Benches will be joining him at the next general election to champion the Government’s policy—Labour’s green deal apprenticeship scheme.

Despite that victory, we still have huge concerns that the Bill will not be as effective as it should be. As a result, we have tabled the new clauses and amendments in this group, which, if passed, would define the scale and purpose of the green deal. They would incentivise councils and engage local communities in the fight against climate change, give businesses the confidence to invest by linking the scheme to the UK’s statutory carbon reduction targets, and end the misery for the hundreds of thousands of men, women and children who are left freezing, shivering under their blankets because they live in cold homes that are not fit for the 21st century.

Labour’s new clauses 1 and 2 would address the lack of clarity in the Bill, better define the purpose of the green deal and ensure that businesses have the clarity and confidence they need in the green deal scheme. Together with amendment 1, our new clauses would explicitly link the green deal to meeting the UK’s targets in our carbon budgets and our fuel poverty targets. New clauses 1 and 2 would place a duty on the Secretary of State to produce a plan for improving energy efficiency and a duty on the Government to report to Parliament on the green deal’s progress towards achieving carbon reductions.

We have heard many soundbites from Ministers about the green deal, such as their description of it as “the biggest home improvement programme since the second world war”, but the Bill contains no strategy for delivering it. We have heard today about the 14 million homes to be improved by 2020, yet we have seen no way to measure whether the green deal is delivering the refit of 4,800 properties a day, or 145,000 a month. None of that is in the Bill. As it stands, there is a danger that the green deal will not live up to the hype. I do not relish saying that: the Opposition want the Bill to be better, not worse, and we want the green deal to succeed, not fail. That is why we believe the Government must go further.

We are not the only ones voicing legitimate concern. After Committee, 51 organisations, including the World Wildlife Fund, Asda and the Federation of Small Businesses, sent a letter to the Secretary of State setting out the concerns that they still had about the Bill. They wrote:

“the debate during the Committee Stage of the Energy Bill has left us concerned that the energy saving programme is not yet guaranteed to be a coherent and ambitious programme, and that the Bill requires further significant improvements. We believe there needs to be an over-arching energy saving plan from the Government to ensure clarity of what is needed to be delivered by the market…Business will find it difficult to be in a position to deliver towards the Government’s aspirations on the Green Deal without this further clarity and certainty.”

The letter concluded:

“It is our view that the Government amendments need to go significantly further and currently do not deliver on the principles reflected in the Warm Homes Amendment. They do not deliver a policy ambition equivalent to the Government’s aspirations or ensure the provision of a plan to cut carbon emissions from buildings and contribute to eliminating fuel poverty.”

The letter proposes three ways to improve the Bill. The first is that

“an aim must be clarified in the Energy Bill that is tied to meeting the target set under…the Climate Change Act 2008, and importantly the individual carbon budgets. The aim must also be tied to the elimination of fuel poverty.”

The second is that an

“amendment to prepare and publish a plan to deliver these aims must be included in the Energy Bill.”

The third proposal is that a

“reporting amendment should ensure…the energy saving programme is linked with other…requirements”.

All three improvements could be made today if the Government accepted our new clauses.

The letter is signed by organisations as diverse as B&Q, Marks and Spencer, Friends of the Earth, the Co-operative Group and the National Insulation Association—the very organisations and businesses that the Government hope will deliver the green deal. Environmental groups, businesses and trade associations are all telling the Government the same thing: “You haven’t got this right. You need to go further.” They are asking the Government to do what the Opposition have suggested in this House and in the other place, but we are now running out of opportunities for the Minister to listen and change his mind.

In Committee, the Government added clause 108 to explain their ambitions for the green deal better, but unfortunately it is inadequate. The clause contains no qualified level of ambition and excludes non-residential properties. By repealing section 2 of the Sustainable Energy Act 2003 and introducing clause 108 to the Bill, the Government are in fact diluting existing energy efficiency requirements. That is why we have tabled amendment 1, alongside new clauses 1 and 2, to ensure that the Government’s green deal definitely results in real carbon reductions. We will press new clauses 1 and 2 to a vote if Government support is not forthcoming, because they are crucial to the success of the programme.

New clauses 3 and 4 would ensure that Britain’s transition to a low-carbon economy is fair. They would place power into the hands of councils and give them the freedom and flexibility to engage with local communities in finding innovative solutions to tackling climate change. They would boost the economy and create jobs by encouraging investment in green businesses. In practice, they would establish a three-stage process. The first part would involve the independent Committee on Climate Change examining the carbon output in every locality and assessing what reasonable action could be taken to reduce carbon emissions; those data would then be used by councils and central Government to agree a local carbon strategy, providing a road map for how the area would reduce its emissions. The local authority could use the strategy to engage the local community and voluntary groups in efforts to reduce carbon emissions and improve energy efficiency.

That idea is not new. The previous Labour Government introduced a pilot programme involving nine councils in January 2010. I am pleased that the Minister announced in Committee that further pilots were to follow, but what we are proposing would allow us to take advantage of economic opportunities that we are failing to exploit. The Federation of Small Businesses, speaking in support of local carbon plans, argues:

“Small businesses are keen to go green…but are not getting the help or incentives they need to do so”.

It goes on to say that they need

“a framework that is flexible and supportive to encourage small businesses rather than penalise them.”

Our new clauses would provide such a framework. They would provide certainty about the scale of carbon reductions locally while allowing local authorities to retain flexibility on how they go about achieving the cuts. It is vital that businesses play an integral role in tackling climate change. According to the FSB, at least one third of the UK’s emissions are from businesses, and the Carbon Trust estimates that 20% of the UK’s emissions are from small and medium-sized enterprises. The FSB calculates that if all UK businesses and public sector organisations install energy-efficient measures, at least £3.6 billion could be saved every year, thanks to the reduction in energy consumption. As well as helping businesses to cut energy usage and reduce costs, estimates of the potential for low-carbon job creation are significant.

Research by Carbon Descent estimates that 70,000 jobs in energy efficiency and renewable energy could be created across the country if all local authorities set about reducing emissions in their areas by at least 40% by 2020. It is easy to see why the proposals have a wide backing both from business and environmental groups, including Friends of the Earth, the Federation of Small Businesses, the TUC, Good Energy, B&Q, the Stop Climate Chaos coalition and, most importantly, local government.

Rather than being seen as a burden by local councils, these proposals have a broad range of backing across local authorities. In March, 40 council leaders from across the political spectrum called for the introduction of local carbon plans. For many councils, the plans build on work they are already doing. By pledging to cut carbon emissions by 40% by 2020 or rolling out grant-funded renewable installation schemes, councils of all political colours—in Liverpool, Manchester, Birmingham, Brighton, Islington, West Sussex and Bristol—are leading the way. Although some councils are making good progress, it is clear that others need to do much more. Any advice to councils from the Committee on Climate Change needs to be meaningful. The level of carbon reductions recommended must be in line with our national carbon budgets and we need to ensure that councils share best practice and policies that successfully deliver local emission reductions, as well as advise each council on the steps that it could take to meet its plan.

The proposals in the new clauses will empower local councils, engage local communities and enhance local economies. They offer a fair way to meet our national climate change targets. We recognise that not every part of our country is the same and that we all need to share the same aim. Ultimately, every one of us needs to do our bit to tackle climate change. We need to go further; we need local carbon plans.

Amendments 47 and 48 would bring forward from 2018 to 2016 the introduction of a minimum standard of energy efficiency in the private rented sector, in line with the UK’s legal target to eliminate fuel poverty. We welcomed the Government’s announcement on Second Reading that they would introduce a minimum standard of energy efficiency for the private rented sector, but we do not believe that a 2018 deadline is adequate; we need to go much faster.

According to the Government, half the properties in the private rented sector are not considered to be of a decent standard. It cannot be right in the 21st century that people are forced to live in unfit homes that they cannot afford to heat. About 1.3 million children live in cold homes. The Marmot review found that this makes them twice as likely to suffer from respiratory problems than children living in warm homes. Anyone who watched the recent BBC documentary, “Poor Kids”, will have seen the haunting footage of Sam who, at the age of 11, said:

“When the gas runs out, the whole house is freezing.”

We must urgently address that problem.

The UK has a legally binding target of eliminating fuel poverty by 2016. How can the Government not introduce the efficiency standard in time to help reach that goal? We know that fuel poverty is at record levels. In July, uSwitch published research showing that a staggering 6.3 million homes across the UK are paying 10% or more of their disposable income towards their energy bills. That means that almost a quarter of all households—24%—find it hard to afford to stay warm. Most worryingly, those figures do not take into account the huge price rises announced over the summer. When those increases hit, the number of people in difficulty will increase dramatically. That should be a wake-up call to the Government. Instead, over the past year, the Government have systematically removed support for fuel-poor households—from scrapping the Warm Front scheme to cutting winter fuel payments by up to £100. They have an opportunity to go some way to rectifying their record by bringing forward the introduction of the minimum efficiency standard.

By ensuring that poor-quality F and G-rated homes are no longer allowed on the rental market, the amendments would improve the living standards of thousands, many of whom are forced to live in the cold simply because their landlords do not know what improvements can be made, or because the owners of properties refuse to improve them. The amendments would end that sooner rather than later, and we sincerely hope that Ministers will support them. The 2016 target still allows adequate time for landlords to be made aware of the changes and to improve their properties.

Amendments 23 and 25 would establish a national landlords register to ensure that the minimum standard is enforceable. A register tightly defined as being for the purpose relevant to the Act would reduce enforcement costs, increase compliance, and help landlords to gain access to appropriate information about the green deal and other schemes such as the landlords energy-saving allowance. It would also leave rogue landlords unable to avoid improving their properties, and with nowhere to hide.

I hope that Ministers will consider carefully the changes that we are proposing, which are intended to improve on what is already in the Bill. I thank the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker), for the way in which he has dealt with Opposition Front Benchers during the progress of the Bill. It was necessary for us to meet him on several occasions and although we did not always agree on the best way forward, he was always courteous in his dealings with us, and I thank him for that.

Our new clauses and amendments would substantially strengthen a Bill that lacks clarity and detail. They would make improving the energy efficiency of our building stock a key part of our strategy for meeting the United Kingdom’s carbon budgets. They would put local communities at the heart of tackling climate change, boost small businesses and non-profit-making organisations —particularly co-operatives and charities—and provide extra support for those who struggle to stay warm. I urge the Government to accept them.

I have now to announce the result of a Division deferred from a previous day. On the motion relating to access to a lawyer, the Ayes were 303 and the Noes were 192, so the Question was agreed to.

[The Division list is published at the end of today’s debates.]

I want to speak to new clause 19, to which my name is attached.

There is much evidence to suggest that too many customers are overpaying for their energy and failing to take advantage of the best offers from energy suppliers. The coalition agreement rightly contains a commitment that energy suppliers will provide information about cheaper tariffs on the bills and statements that they send to their customers, but although energy bills have become longer, evidence suggests that the additional information has had only a limited effect in encouraging customers to switch to cheaper tariffs. What is required is much clearer information on tariffs, tailored to a customer’s actual usage and payment option, to help customers to move to a company’s cheapest tariff. New clause 19 aims to make that a reality.

The case for more clarity on bills is very strong. The average annual energy bill has doubled since 2004; bills have risen significantly this year alone, and may do so yet again before the winter. According to analysis by Which?, the cost of energy is the number one financial concern of nine out of 10 customers. It is of particular concern to the vulnerable in society, especially those who live in fuel poverty. Estimates of their number vary, but I do not think there is any disagreement on the fact that there are between 5 million and 6 million of them.

The problem is that tariff structures are too complex. According to Ofgem’s retail market review, well over 300 tariffs were available to customers at the beginning of 2011. Research by Ofgem and Which? has found that people are baffled by not just the number but the many components of energy tariffs, such as standing charges, tiered rates, discounts and cashback offers. Ofgem calculates that one third of those who switch do not achieve a price reduction, although the vast majority switch in order to save money. That fuels cynicism in the energy market. Only one in three customers trusts the supplier to sell them the best tariff, and Ofgem believes that as many as six in 10 energy customers are inactive, many being completely disengaged from the energy market and potentially paying over the odds.

A further complication is that different payment methods have different outcomes. According to Ofgem, a customer who at the beginning of last year had changed their payment method from standard credit—paying on receipt of a bill—to direct debit could have saved more than £120. Which? estimates that more than 11 million households could benefit from switching to a direct debit payment method. I do not claim that all such households would want to, or that all would be able to, because many do not have a bank account, but that figure is great enough for this issue to warrant closer scrutiny.

Clarification is needed on the green deal and prepayment meters, which are a method that households can use to manage their budget.

The hon. Gentleman makes a decent point. There is a lack of clarity on a range of issues. We want to encourage people to get on to their company’s cheapest standard direct debit tariff. We must try to ensure that bills are clearer, otherwise people will continue to pay too much for their energy.

I am concerned that some people with prepayment meters will not be able to switch to direct debit. What is the hon. Gentleman’s view on prepayment meters? People will load up and pay heavily on the meter in the winter, but budget and save in the summer. Under the green deal, payment rates will now differ, however. By the end of the summer, people may have a backlog in what is effectively a standing charge on the green deal.

That is a fair point, but I would say in reply that we need greater clarity on bills on the availability of cheaper tariffs depending on payment method, which would include prepayment. We are not getting that at present. At best, we are getting generic messages saying, in effect, “You may be able to save money if you ring this number,” but the evidence suggests that such messages are not sufficiently strong to incentivise people to find the cheapest tariff. New clause 19 addresses that specific point.

In the Retail Market Review, Ofgem stated its disappointment that the energy suppliers have not abided by what it considers to be the spirit of its post-2008 Energy Supply Probe standards of conduct, and that they have not always made details about switching as prominent as they might—although some companies have gone further than others. Ofgem is therefore frustrated about the lack of progress in this area.

Having questioned both the previous and the current Governments about the need to do more in this area, I was pleased to see a coalition commitment that energy suppliers should provide information about cheaper tariffs on the bills and statements they send to their customers. In October last year, I sent a letter to the Secretary of State suggesting a solution to these problems, which involved energy suppliers printing clearly on customers’ bills how much money they would save if they were on their supplier’s cheapest standard tariff, assuming different payment methods. I felt that talking about pounds, shillings and pence—I was brought up in the pre-decimalisation era—sent a much stronger message than giving just general signposting information.

Discussions followed and in June 2011 I was invited by the Minister of State to chair a billing stakeholder group to make recommendations about the implementation of the coalition agreement commitment. The group comprised representatives from the Department, from ERA—the energy retail association, representing the energy suppliers—and from consumer groups such as Which?, Consumer Focus, Citizens Advice and Ofgem. Useful meetings were held over the summer and I thank all the members of the group for their contributions.

During that process, two proposals emerged. The first, suggested by ERA, was for a generic signpost message, including a telephone number or website that customers could use to find cheaper tariff options, to be displayed prominently on customer bills. The second proposal reflected the view of Which? and my proposal in my letter of 18 October 2010 for a more tailored message on customers’ bills. This message would quote pounds, shillings and pence saved, depending on the payment method and tariff, as determined by the customer’s actual usage over the previous 12-month period, where appropriate.

I am particularly concerned and exercised about people who never receive a bill, particularly pre-payment meter customers or card meter customers. Of course, there is the opportunity to have a large message printed on the receipt printout that one receives when paying at an outlet, and I hope that that option is included in the proposals. Also, there may be the option of ensuring that people who pay in advance for the sake of convenience or because they have an erratic income might be given a clear definition of what they might save by moving to a standard tariff.

My hon. Friend makes a good point and I shall come to that issue in relation to new clause 19.

Although ERA objected to the second proposal, the general consensus in the group was that the second, more tailored proposal was the way forward, because a message about potential savings in pounds, shillings and pence was thought to be more powerful than a simple signposting message. Ofgem acknowledged that this was in line with its direction of travel and cited research finding that customers are more likely to be interested in information that is personalised to their needs and circumstances. ERA was opposed to the second proposal for a variety of reasons—for example, that suppliers’ billing systems could not handle such a change in time for this winter and that they wished to wait for Ofgem’s retail market review findings.

Let me outline the recommendations from the billing stakeholder group. First, it accepted ERA’s view that the second proposal was not possible this winter. It was therefore agreed that energy suppliers should send out a letter to their customers—not an annual statement, because a lot of people do not get one—in time for this winter, clearly detailing the extent to which customers were overpaying or underpaying compared with that supplier’s cheapest standard direct debit tariff. Ofgem already requires this to be done once every 12 months, but has been disappointed by energy suppliers’ responses to date. We are asking not for anything new, but simply for something that Ofgem already requires energy suppliers to do. The group suggested that suppliers should send a letter rather than a text or e-mail because this is an important communication and such a system would allow consumer groups such as Which? to get behind the letter and mount a co-ordinated campaign to generate interest. Such groups have historically been very good at doing that and many of the stakeholders in the group, including Which?, would be happy to undertake such a campaign. An e-mail would be acceptable only for those already paying by online tariff. We thought the letter should be sent to all customers because even those already paying by direct debit may not be on that supplier’s cheapest standard tariff.

If I may finish dealing with the two proposals, I will give my hon. Friend her chance again.

Secondly, it was agreed that the energy suppliers would introduce their idea of a generic signpost message on bills, again in time for this winter. Thirdly, it was agreed that the two proposals outlined—ERA’s generic signpost message and Which? and my more tailored message—would be market-tested to determine which was the more effective and how best to present such information to customers. Energy suppliers would abide by the conclusions, once researched, in time for the implementation by the winter of 2012-13. The amendments and new clause 19 reflect the group’s recommendations.

I wonder whether my hon. Friend’s proposals and discussions include a number of people who pay by direct debit. It noticeable—is it not?—that people can overpay by direct debit. They might be on the cheapest tariff, but the arrangement in place involves high regular payments. Energy companies never hesitate to contact us to let us know that we should pay more, but I have never been contacted to say that I am paying too much. We need to get a grip on that, because it affects people who do not necessarily understand the fantastically complex information that is sent out on bills, and there is a lack of fairness.

I should like to draw out a point about estimated bills. I met members of various energy companies last week, and they have no idea how many people receive estimated bills. Those who have received estimated bills for a year and are billed now for the outstanding amount will pay the new, inflated prices.

I thank my hon. Friend for those questions. I hope that both of them will be addressed by the research undertaken if the group deemed it necessary.

I apologise for coming in and out of the debate because, like many other hon. Members, I have had to deal with other issues. Does the hon. Gentleman envisage his amendment covering people who are off-grid who are not protected by Ofgem and have difficult suppliers? Indeed, their supplies can be cut off at short notice. We are dealing with people who are connected to both gas and electricity mains, but more than 4 million households are not on the grid. Those people can be highly vulnerable and experience the greatest fuel poverty.

I thank the hon. Gentleman for making that point. I hope that there will be no discrimination in how the information is presented. It is as simple as that. Bills go out to everyone in the land, and the information would be pertinent on those bills. Again, the research would ensure that we reached all sectors of our communities.

Does my hon. Friend agree that the clarity of bill point that he is making eloquently and well would not necessarily be of use without clarity of ownership? He will be aware that a multitude of companies supply heating oil, which we debated in Westminster Hall in January this year, but the market is dominated by one monopolistic company—DCC Energy—which is being investigated by the Office of Fair Trading. Does he agree that the proposal should include clarity of ownership, so that proper price comparisons can be made?

My hon. Friend makes a fair point. Undertaking market research into the two proposals and getting energy suppliers to abide by the findings of the research in time for next winter would have the advantage of making it much easier for a customer to get a figure from their company, based on their actual usage, because the message would be tailored. That would make comparisons with other companies much easier. At the end of the day, all we can do in the House is legislate to try to help consumers as much as possible to gain the necessary information for them to make informed choices. If they have that information, direct comparisons with other companies could help competition and consumers generally.

To pursue the point made by the hon. Member for Ynys Môn (Albert Owen), does the hon. Gentleman not accept that the real problem with the off-grid market is the fact that there are no differential tariffs, as there is a set price for oil and gas? There are no social tariffs as there are for gas and electricity, so does he agree that that must be tackled before his excellent proposal could take effect in that market?

The hon. Gentleman has a point, but his proposal goes only so far. My problem is that energy bills are far too complex. I want to set hon. Members’ minds at rest: I do not stay up at night studying my energy bills, despite what Ministers think, although I might create the impression that I spend my time doing nothing else. The essential information is often contained on one page, followed by five or six pages of bumpf which compares usage with neighbourhood usage, and even usage overseas and so on. It is a lot of nonsense. What we want is clear information to cut through the 300 existing tariffs, which can be confusing. We need greater clarity, and there is no better way of getting that than making sure that we have information on a bill that says in pounds, shillings and pence how much would be saved if that customer was on the company’s cheapest standard tariff, taking into account actual usage and payment method. If that information was clearly laid out in no more than four or five lines, we could cut to the quick very easily indeed.

Before I accepted a series of interventions—hon. Members were right to make them and I hope that I have answered their questions—I described the three proposals suggested by the billing stakeholder group: two for this winter, the letter and the generic message; and one for next year, which would be an obligation on suppliers, following research on which is the clearest message, to put that in place for winter 2012-13 . Ofgem supports the billing stakeholder group’s general direction of travel, but I am aware that it is about to publish detailed proposals, following consultation, as part of its retail market review. One measure that it is considering is increased prescription on suppliers’ communications with customers in bills and annual statements. Having discussed that with the Minister, I understand that he has asked Ofgem to publish its findings before Christmas. He and I have therefore agreed that we will wait to see what those findings are before the billing stakeholder group and the Minister consult on whether Ofgem’s recommendations go far enough. If not, the third recommendation, in subsection (c) of new clause 19 will be triggered.

I therefore seek assurances from the Minister that the recommendations from the billing stakeholder group, as reflected in the new clause, will be agreed by the Government, with the qualification that we await the findings of Ofgem’s proposals in December this year before deciding whether to trigger subsection (c). The Minister has kindly indicated in previous discussions, following my letter to him of 8 September this year containing the stakeholder group’s recommendations, that he supported the proposals—something that I very much welcome, and for which I thank him. I therefore look forward to his response.

I should like to speak to amendments 24, 23 and 25, which deal with the registration of information with landlords, and amendment 47, which would bring forward the date on which the standard came into force from 2018 to 2016.

I am pleased to make a contribution to this vital debate, and I thank my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) for tabling the amendments on landlord registration, as they are important for constituencies such as Hyndburn. The problems that parts of the country such as mine have in trying to comply with any form of action must be appreciated.

During the summer recess, many hon. Members enjoyed the less than balmy summer statistics released on fuel poverty. They show that far too many of our constituents dread the coming of winter because it will mean living in a home that is cold and damp, and the daily choice between whether to turn on the heating or to go without food or other essentials presents itself. Official statistics show that, in 2009, 5.5 million households in the UK could not afford to heat their home to a reasonable level and lived in fuel poverty. My constituency has a worse than average level of fuel poverty, with 7,352 households—one in every five—living in fuel poverty. This summer also brought the dreadful news that the big energy companies are to push up their prices even further, which will increase those numbers. It will result in more misery for the people in my constituency. Citizens Advice handled 104,000 fuel debt inquiries last year.

The worst conditions are too often found in properties rented by landlords. The most recent English housing survey found that more than 40% of private rented homes were not of a decent standard compared with 27% of local authority housing. Some great work on conditions in the private rented sector is being done by charities such as Shelter and Crisis, but we must do more. Last week, tenants in privately rented homes came together to form the national private tenants organisation, a move that I warmly welcome. It certainly has my support. They deserve the attention of the Minister for Housing and Local Government, who seems unable to hear anything but the voices of the landlord lobby. Almost as soon as he stepped through the door of the Department for Communities and Local Government, he declared:

“With the vast majority of England’s 3 million private tenants happy with the service they receive, I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords.”

In my area there is a high demand for private rented accommodation, but many tenants who come to see me feel threatened by their landlord if they raise these issues because, regardless of the state of the property, there is always someone else willing to take it on.

I had intended to raise later the issue of retaliatory eviction and the fact that landlords put pressure on tenants. More specifically, the short answer to my hon. Friend is the Channel 4 programme “Landlords from Hell”, which was broadcast last month. In it a landlord openly boasted that he could act above the law. If tenants did not like what happened, he would take a baseball bat to them. He could manipulate their rents however he wanted, and if they did not like it, violence resulted. The tenants who were interviewed understood this and lived in fear. That is the worst case, but there are many cases where the law on retaliatory eviction is weak, and something needs to be done about that. My hon. Friend raises a good point, which I may return to later.

The Minister seems to be on the landlords’ side, which does not work for a constituency such as mine, and he is being complacent. Rather than landlords’ behaviour improving, it seems to be getting worse as a result of his inaction. In March, Shelter recently reported a 23% increase in the number of people seeking help for problems with private landlords in the past 12 months. Only this week, Shelter found that complaints to local authorities about private landlords have increased by a fifth in two years, with 86,000 made last year.

In Hyndburn, the stark reality is that we have a second-world Britain, with shocking housing conditions that would not have been found in the old East Germany. Private landlords condemn parents and young children to housing misery. As the Housing Alliance reported last week, the UK has some of the worst housing in western Europe, and constituencies such as mine are plagued by this housing crisis. It condemns people to worklessness, as wages cannot keep up with rising costs, and that will impact on the introduction of the Bill.

One measure that would help to tackle the conditions in the private rented sector is a national register of landlords. The Government have seen fit to drop the proposals made by the previous Government for such a register, and that is such a shame. The Bill represented a good opportunity to introduce a register. However, we can still achieve some good by ensuring that the energy performance certificate register records the tenure of the property, where it is rented and the name and address of the landlord. Amendment 23, tabled by my hon. Friend the Member for Liverpool, Wavertree, would achieve that. I cannot see what possible objection there could be to that most minimal of measures. Some might say that it is the thin end of the wedge, or a “landlords register lite”. I wish it were, but it is not, because local authorities would be unable to access the information for other matters they have to deal with. However, it would help them to get accurate information to landlords about the green deal, the landlords’ energy efficiency tax break, their legal duties and other such advice.

Disrepair can take many forms, but in this debate we are obviously concerned with one of the most serious threats to the health of tenants: cold. The increased risk of death for the elderly resulting from cold homes is well established. We have recently seen new evidence in a report by Professor Sir Michael Marmot of University College London about the dreadful damage to the health of children and teenagers that can result from living in a cold home. Children are twice as likely to suffer from respiratory diseases, such as asthma, if they live in a cold home. The very worst insulated properties, those in band G of the energy efficiency rating, are more than four times as common in the private rented sector as they are in the social sector. There are 680,000 private rented properties in England with the worst energy efficiency ratings of F and G. More than 40% of those households live in fuel poverty.

Almost all Members of the House must be aware of, and grateful for, the coalition of 40 organisations that have campaigned during the passage of the Bill to raise our awareness of the problem of cold housing in the private rented sector and that have proposed a solution by championing the idea of a rising minimum standard of energy efficiency for rented homes by 2016, rather than 2018. Without wishing to overlook the contribution of any other organisations, I congratulate Friends of the Earth, Citizens Advice and the Association for the Conservation of Energy on the well-run campaigns that they have pursued.

The Government have responded to this campaign, which is strongly supported by the Opposition, by including legislation that will make it mandatory to improve F and G-rated homes from 2018. This is a step forward, but it is not nearly good enough. Improving F and G-rated homes could have considerable health, climate and consumer benefits, lift 150,000 households out of fuel poverty and save an average of £488 in the annual energy bills of the homes improved. All these benefits will be unacceptably delayed if the introduction of the minimum standards is pushed back to 2018. More than 180 MPs, including many Government Members, have called for the introduction of those standards in 2016. Seven years is an unnecessarily long time to wait, and 2018 is two years after the date by which the Government have a legal obligation to end fuel poverty. In addition, introducing the minimum standard in 2016, rather than 2018, would cost the Treasury nothing.

In Committee, the Minister was unable to give any clear explanation on why 2018 was chosen. He said:

“Ultimately, the date is a matter of judgment and balance. I do not think that we would pretend that there is anything perfect about 2018; there are arguments in favour of setting an earlier date, and I am sure that some would argue for further delay.”

The only reason offered was the proportion of tenancies that would have to be turned over by 2018. The Minister argued:

“Most tenancies, I am told, are 12 to 18 months, so by 2018, we expect that 80% to 90% of tenancies will have changed. .”––[Official Report, Energy Public Bill Committee, 14 June 2011; c. 182-85.]

He was unable to say why 80% or 90% of tenancy turnover was the right proportion, or what the turnover would be by 2016, two years earlier. However, Friends of the Earth calculated that the number of private rented sector tenants who had resided in their current home for five years or less is 80.3% and that the number of people who had resided in their current home for 10 years or less is 89.8%. So when the Minister argues for a delay until 2018 because there is likely to be an 80% to 90% turnover by then, he is wrong; there may in fact be an 80% to 90% turnover earlier than that—it could be expected to occur by 2016.

The independent Committee on Climate Change, in its recent third progress report to Parliament, specifically called for earlier introduction of regulation for the private rented sector, stating that

“there is no reason to delay implementation of this aspect of the proposals.”

It would be a tragedy if the Government’s response to the news that 5.5 million households—many in the private rented sector—are in fuel poverty was to delay a vital measure that would tackle fuel poverty and cut energy bills.

I shall speak to amendments 2 to 6 and 8, in my name and those of right hon. and hon. colleagues on both sides of the House, on energy efficiency in the private rented sector.

I join other Members in congratulating the Department on going a long way to tackle the problem in the private rented sector by agreeing to introduce a minimum efficiency standard and by declaring that it is simply unacceptable to rent out dangerously cold and draughty homes. The Department has gone far further than many expected, and the minimum standard is a major achievement that goes some way to meeting the Government’s pledge to be the greenest Government ever.

I also pay tribute to my hon. Friend the Member for Wells (Tessa Munt) for her work in Committee, to the Minister of State and to my right hon. Friend the Secretary of State for Energy and Climate Change for genuinely engaging with the coalition of organisations that support the introduction of a minimum standard.

My amendments are backed by a coalition of some 40 organisations, and I join the hon. Member for Hyndburn (Graham Jones) in thanking Friends of the Earth, the Association for the Conservation of Energy and Citizens Advice for all their work during the passage of the Bill and for supporting my amendments.

The Government have taken a giant leap forward by agreeing to introduce a minimum standard, and we should not underestimate how far the Department has brought us, but my amendments seek simply to take a further, much smaller step forward.

The most important of my amendments is amendment 6, which would bring forward the date by which landlords have to bring their property up to a minimum standard. So far, 181 MPs from nine different political parties on both sides of the House have signed early-day motion 653, which I tabled in July last year, so there is clearly cross-party support for bringing in the minimum standard by 2016.

The Government have given no good reason why the deadline must be 2018 and not sooner, but there are plenty of good reasons for introducing it sooner. The Warm Homes and Energy Conservation Act 2000 requires the Government to do all that is reasonably practicable to eradicate fuel poverty by 2016, and there must be very compelling reasons not to meet that obligation. According to the most recent figures, 5.5 million households are in fuel poverty, and housing makes up 27% of the UK’s carbon emissions—a strong argument for it playing a central role in the Government’s plan to meet their carbon budgets under the Climate Change Act 2008.

Owing to the lack of available social housing in recent years and the failure of successive Governments to prioritise and tackle the lack of affordable rented property, there has been an increasing reliance on the private rented sector to provide homes. Although there are many good landlords, there are still a number who let substandard properties, and in my constituency some private rented accommodation is among the worst and least energy efficient property available.

The Department’s own impact assessment estimates that 42% of households in F and G-rated properties in the private rented sector are in fuel poverty, and Friends of the Earth-commissioned research by Consumer Focus estimates that 150,000 households would be lifted out of fuel poverty simply by bringing F and G-rated properties up to a minimum E standard, saving an average of £488 on the annual energy bill of the improved homes. It is also estimated that that would save 1.87 million tonnes of CO2 annually and £145 million currently spent by the NHS on treating illnesses caused by cold rented homes. Those are all good reasons to bring forward the date to 2016.

Bringing forward the deadline to 2016 would still give landlords nearly four years to comply with the minimum standards. Ministers have argued that waiting until 2018 means that the majority of private tenancies—getting on for 90%—will have changed hands, which will give landlords the chance to upgrade and retrofit the properties before a new tenant moves in. That is a reasonable argument, as it creates the minimum disruption for the minimum number of tenants and will cover the vast majority of tenants in longer-term lets. However, the vast majority of private tenancies—between 80% and 90%—will also have changed hands by 2016, and so bringing forward the deadline would cause very little, if any, additional disruption for tenants.

The Bill should be amended so that we have a 2016 deadline after which all private rented sector homes must, by law, be at least E-rated for energy efficiency. The 2016 date clearly meets the Government’s stated criteria of being

“a date by which properties with long-term tenancies will have gone through a tenancy cycle”.

The 2016 date has been backed by the Committee on Climate Change, which, since the Committee stage of the Bill, has stated:

“There is no reason to delay implementation of the proposals. The regulation would only apply to F and G-rated properties and improvements would be relatively low cost in most cases.”

Research suggests that the vast majority of these properties could be improved to meet the minimum standard for less than £3,500, and that for 37% of them it would cost less than £900 to make the necessary improvements.

Today’s letter from the Minister to Friends of the Earth made it clear that the Government are not going to concede any ground on the date and suggested that it was a matter for Parliament. Well, I am making it a matter for Parliament today. I would have been prepared to withdraw the amendment if I had received a commitment to a public consultation on changing the deadline, but because there has been no such commitment I feel that it is necessary to seek to put it to the vote.

I have tabled amendments 2, 3 and 5 because clause 42 does not mention the role of letting agents and those marketing rented properties. Ministers say that it is “implicit” that the minimum standard will have an impact on not only landlords but anyone acting as their agent, including letting agents and estate agents. The Department has subsequently stated that the Consumer Protection from Unfair Trading Regulations 2008 will prevent landlords and letting agents from marketing F and G-rated properties. I hope that the Minister can give a clear indication of how the regulations will do that, and then I will be happy to withdraw the amendments.

I welcome the provision in clause 45 that means that landlords cannot refuse consent for reasonable requests for energy efficiency measures. Some tenants already worry about asking for reasonable repairs because of the potential threat of retaliatory eviction, so how many will exercise that right if they face a strong chance of being chucked out of their homes? The National Private Tenants Network has clear evidence that retaliatory action is occurring, including landlords seeking possession of a property under the Housing Act 1988. The Housing Minister has said that it is vital that tenants can ask for repairs without fear of eviction, and I welcome that comment. In Committee, Ministers acknowledged those concerns and set up a stakeholder group on retaliatory eviction. That is a step in the right direction because it is vital that tenants have legal protection against such retaliation.

Amendment 8 seeks to give the Secretary of State the power to include in the regulations protection for tenants by limiting the circumstances under which a section 21 notice for eviction of a tenant can be served once a request has been made by the tenant for relevant energy efficiency measures. I would be grateful if the Minister updated the House on what progress has been made by the stakeholder group in ensuring that tenants are protected against eviction.

Finally, amendment 4 seeks to ensure that improvements that are carried out on a property that falls below the E rating make it reach a minimum E rating. It is not clear from clause 42 that it will be mandatory for improvements to bring it up to band E—the minimum standard the Government want to see. Subsections (2) and (3) suggest that landlords will have to make “relevant energy efficiency improvements”. The clause states that those improvements can be financed by the green deal, the energy company obligation or other financial arrangements. Those improvements might bring the property up to band E, but they might not. For some band F and G properties, landlords will rely on using ECO, a fixed pot of money that will not pay for all improvements or other sources of funding. In such cases, landlords will not know what is expected of them. That will not only create the danger that private rented sector tenants might not benefit in full from the improvements the Government want to see; it will also create uncertainty for landlords.

Once the principle of regulation has been accepted—as it has been by introducing a minimum standard—it is in the interests of landlords for that regulation to be clear and straightforward to comply with. The ambiguity will make it more difficult for local authorities to undertake their enforcement role. They will somehow have to distinguish between F and G rated properties that are legal because they have been improved and those that are illegal because there have been no improvements. We need to mend the legislation to make it crystal clear to anybody what the minimum standard is, and amendment 4 seeks to do that.

I will address my remarks to amendments 9 to 12, which I tabled. I will also put those amendments in the context of the other amendments in the group headed “Energy efficiency”.

I will question to what extent the Bill is attached to anything by which it can be measured. What might we mean by the success of the green deal, the energy company obligation or the energy efficiency aspirations of the Bill? As things stand, it is difficult to attach the good ideas, aspirations and programmes in the Bill to any sort of measure. Most importantly, it is difficult to attach them to one of the key measures we currently have, which is the progress we are making in reducing our carbon emissions under the Climate Change Act 2008. That Act asked for certain actions to be undertaken by the Committee on Climate Change. In its progress reports and recommendations on meeting our carbon budgets, the Committee has increasingly involved itself in specific measures that, among other things, are the domain of the Bill, such as targets for the removal of problems relating to non-cavity wall homes through external and internal insulation. Such measures contribute to greater energy efficiency and, as a result, to reducing carbon emissions.

My amendments would do something very simple: they would require the Department to assess the cost-benefit relationship between undertaking and investing in energy efficiency measures and undertaking investment in and pursuing energy generation. It will be good for policy direction if we know the costs and benefits before mounting programmes that could have a substantial impact on either. The fact is that we do not know and no one has done that kind of work within or outside the Department, yet a substantial raft of policies have been launched on that non-understanding, including a number of policies in the Bill. Frankly, that is not a rational way to make policy, and the Department’s chief scientist, Dr David MacKay, very much agrees. He said recently:

“I agree that this is a crucial comparison to make, and I would love to see us develop a rational, quantitative approach that incentivises energy saving in the same way that, say, renewables are incentivised.”

Amendments 9, 10, 11 and 12 would require the Minister to assess that and report to the House to inform policy making.

Essentially, my proposals are in the same vein as several that we have debated this afternoon. New clauses 1 and 2 would explicitly link the aims of the Bill to the progress made on reducing carbon emissions and to reports from the Committee on Climate Change. The Department would have to provide a clear strategy in its plan for delivery and ensure that the strategy is based clearly on a link with climate change strategy. Similarly, in respect of putting local authorities at the heart of local carbon reduction, a requirement would be placed on the Committee on Climate Change to advise on local area carbon emissions, so that they too are linked.

We need to be able to relate the ambition—the overwhelming imperative—to reduce energy use in the residential and small business sector to what we need to achieve by certain dates in terms of improving the energy efficiency of property throughout the UK. That is one of the key areas on which the Bill remains silent. After the end of Warm Front, the carbon emissions reduction targets, the community energy savings programme and various other programmes, the green deal and the energy company obligation are the only shows in town as far as making progress on energy efficiency in homes is concerned.

The Bill sets out a number of ways in which the green deal and the ECO can move forward, but it does not set out any means by which to assess their success or appropriateness. That is significant in terms of the proposals in the Bill for the development of the ECO. We are asked to accept that an ECO of perhaps £1 billion a year will get close to achieving the loft insulation, cavity wall insulation, and solid wall insulation tasks that face the country over the next period, which relate to the Committee on Climate Change recommendations. Indeed, my hon. Friend the Member for Brent North (Barry Gardiner) described a number of the scenarios that have been set out and said what we ought to be achieving for the third progress report of the Committee on Climate Change. What is the Government’s ambition within the likely terms of the Bill? Will the finance be available to get us anywhere near that ambition?

The figures suggest that by the early 2020s, using a combination of green deal, CERT extension and the ECO, we are likely to be almost 5 million properties short on loft insulation, 4.5 million short on cavity wall insulation and 200,000 short on solid-wall insulation. Those figures assume the Government’s low-scenario ambition, and although they decrease if we adopt their high-scenario intention, they still fall substantially short not only of the imperative and ambition, but of the likely finance.

The ambition for the ECO appears to be about £1 billion to £2 billion per year, yet clear figures are available on the cap within which that ECO obligation will fall. The £11.8 billion cap for the current spending period was set by the Treasury at the last Budget and includes the renewables obligation, feed-in tariff and warm homes’ discount. According to the Treasury, the ECO is likely to fall within the cap, which means either removing from the cap some of the areas currently funded up to 2015, or increasing the cap to accommodate the ECO. I believe that the Department thought that it had agreed the latter verbally with the Treasury, but it appears that that hope has been dashed—certainly it seems less certain than the Department thought it was a little while ago.

We do not know how much funding there will be for the ECO over the next period. We do not know whether the Treasury will place it inside or outside the original cap or inside a larger cap. Significantly, some claimed that the Treasury announced the cap following the referral of the measures in it to the Office for National Statistics and that, because those levies and arrangements, which are similar to the ECO, were declared to be imputed tax-and-spend devices, the ONS considered them to be so. That is not so, however. Only one of those three devices went to the ONS. The Treasury effectively declared that the other two were the sorts of things that the ONS could decide were imputed tax-and-spend devices and so put them within the cap.

That does not augur well for the ECO being taken seriously by the Treasury as a necessary and substantial measure for tackling problems with solid-wall insulation and fuel poverty, where people need assistance outside the terms of the green deal owing to their individual circumstances. It is also a bad augury because it appears that the Treasury can declare by fiat what those things should be and, therefore, how they should be limited. The Minister should bite the House’s hand off to incorporate these amendments into the Bill, but I suspect that he will not.

The amendments relate to targets, to the progress that we need to make on climate change, and to the real cost to the country of tackling the problems of solid-wall insulation and helping people in fuel poverty and those otherwise unable to access the green deal. The Minister would then be able to say to the Treasury, “It is not good enough to impose a cap because of the requirements of the Bill. Even if there is a cap on these arrangements, other measures will be needed that may contribute towards the success of such targets in the fight to make energy efficiency a much more central part of our approach to the fabric of our property and its energy efficiency.”

New clause 7, tabled by the hon. Member for Brighton, Pavilion (Caroline Lucas) sets out, among other things, a number of areas in which one might look for additional funding to augment the energy company obligation in order to reach those targets. We would be able to argue for that if the new clauses and amendments were accepted, strengthening the approach to the overall energy efficiency target that we all know we have to reach.

It would be a good idea for the Government to move towards ECO-mortgages for homes with solid-wall insulation, with the interest perhaps paid by ECO capital under a new golden rule that the net effect must be less than the payments. That would greatly expand the effect that ECO would have, over and above the level to which it seems to be limited at present.

Unless the Bill contains measures that enable us to see where we are going, what we need to do, and how that relates to the wider issues tackled by, among others, the Committee on Climate Change, I fear that in a few years people will say that the Bill was a good try but it did not get very far, despite the good intentions. Adding backbone to the Bill by making clear what it should achieve and why would make it central to our attempts to tackle climate change, energy efficiency in homes, and our obligation to ensure the best energy efficiency arrangements for the homes of those currently in fuel poverty, to proof them as far as possible against future fuel poverty.

I associate myself with the comments made in support of the amendments tabled by the hon. Members for Liverpool, Wavertree (Luciana Berger), for Basildon and Billericay (Mr Baron), Member for Manchester, Withington (Mr Leech) and for Southampton, Test (Dr Whitehead).

I shall say a few words in support of my new clause 7, which I believe would go to the heart of whether the green deal will succeed or not. As the Minister knows, I strongly favour a properly publicly funded, street-by-street, area-based approach to domestic energy efficiency programmes. That would be far more effective than the market-based green deal approach that the Government are pursuing, not least because a market-based approach will not work for those on low incomes living in fuel poverty. I welcome the fact that the Government have acknowledged that the green deal finance mechanism is not appropriate for those groups—essentially low-income and vulnerable households that have under-heated their homes in the past.

It is crucial to recognise that the golden rule is much less likely to work for households, as they are much more likely to use the money notionally saved from their fuel bills to increase their thermal comfort—in other words, to take the benefits of energy efficiency improvements in increased warmth rather than in increased savings. That is why the energy company obligation is so important, yet under the Government’s current proposals, I am concerned that the obligation is being seriously under-resourced.

The purpose of new clause 7 is to try to identify additional support to allow us to create a significantly larger ECO pot of resources and to supplement it with some other sources of revenue. In arguing for more resources, I have tried to be helpful by suggesting possible sources of funding that could come on stream in the years to come—namely, receipts from auctions under the EU emissions trading system, the carbon floor price, a tax on gas and electricity companies, or, if necessary, direct taxation. Let me say a few words about why those resources are so desperately needed.

As other hon. Members have said, the scourge of fuel poverty is getting worse, not better. The latest Government statistics, from 2009-10, show 5.5 million UK households in fuel poverty, or 21% of the total. Retail energy prices have continued to rise since the fuel poverty figures were updated, with five of the six main energy suppliers recently announcing higher charges for gas and electricity, which will inevitably increase the scale of fuel poverty. As a result, National Energy Action estimates that we are currently closer to having 6.5 million households across the UK living in fuel poverty. However, the stark truth is that existing programmes to address fuel poverty through energy efficiency are not equal even to current demand.

If there is to be any prospect of meeting our social and environmental objectives, and if the 2016 target to eradicate fuel poverty in England in particular is to be met, the Government must introduce much more ambitious policies to support and protect low-income and vulnerable groups. That means that the ECO must be much better funded and supplemented with other resources if it is to provide the necessary support for those who are fuel-poor and living in vulnerable households and for the hard-to-treat properties that need it most.

Would the hon. Lady care to tell the House approximately how much she believes is available or needed for the ECO, and how much of that the sources named in her new clause—in particular, those named in subsections (1)(a), (b) and (c)—would provide?

If the hon. Gentleman holds on for just a moment, I will come to those very figures. Indeed, the question that I wanted to ask the Minister was whether he could outline the latest thinking on the level of funding for the ECO pot. The figure of £1 billion has been cited in the past, but a recent all-party report recommended that the annual contribution through the ECO should be no less than £2.5 billion, focused exclusively on low-income and vulnerable households. Other reports have suggested that the contribution should be as much as £4 billion a year.

Let us not forget that the introduction of the ECO will coincide with the end of all Exchequer funding for domestic energy efficiency programmes—the first time in three decades—when Warm Front is phased out. As we have discussed, the ECO will be funded through a levy on all customers’ fuel bills, regardless of households’ financial circumstances. That is inherently regressive and can result in perverse outcomes. I mentioned earlier that if we are not careful, we could push more people into fuel poverty by levying a fee on all bills—rather than by adopting a taxpayer-funded approach—than we take out of fuel poverty. It is simply not acceptable for low-income and vulnerable households effectively to subsidise those who just happen to live in hard-to-treat homes, but who are perfectly able to pay to heat them properly. The dual function of the ECO pot is therefore misguided and risks creating cross-subsidies from the poorest to the better-off.

In their paper “Extra help where it is needed: a new Energy Company Obligation”, published in May, the Government provide further information about the ECO, and in doing so partially recognise the limitations and regressive nature of the policy, as well as acknowledging concerns about targeting and equity. That document says:

“As the delivery costs of ECO are assumed to be recovered by the energy companies through increases in consumer bills and therefore spread across all households, it is important for the credibility of the scheme to ensure that all households have fair access to the benefits, safeguarding distributional equity. In addition to providing for affordable warmth, this includes considering how the benefits of support for solid wall insulation can be delivered equitably. We are looking into learning the lessons from CERT”.

Those are the challenges that need to be overcome. The case that I want to make—the same case as that made by the Committee on Climate Change—is that the funding available from the ECO should be used exclusively for low-income and vulnerable households, including those in hard-to-treat homes. Essentially, what we should not do is use ECO funds for those in hard-to-treat homes who can afford to pay for them.

The hon. Lady is making a powerful case, with which I agree, in criticising the market-based approach to the alleviation of fuel poverty. Is she also concerned about the figures that appeared on the front page of The Daily Telegraph last week, which suggested that the cost of the renewables obligation and the feed-in tariff could, depending on the price of carbon-based fuels, be as much as £300 per household? That would negate most of the benefits of the Bill.

I did not see that piece in The Daily Telegraph, but I would query some of the assumptions on which such a calculation was based in relation to the levels that fuel bills might reach—because fossil fuels are getting so expensive—without some measure of investment in alternative fuels. I take the hon. Gentleman’s point, however, that it would be better not to put more and more obligations that have to be paid for on to people’s fuel bills. That is a regressive thing to do, and any such measures should be funded either through direct taxation or through mechanisms such as the emissions trading scheme’s revenues.

The Committee on Climate Change has highlighted its concerns about the dual direction of the ECO funds. It states clearly that they should be used to prioritise solid-wall insulation in the 1.9 million fuel-poor households that live in solid-wall properties. We should combine the two functions of the ECO: yes, it should be used for low-income and vulnerable families, but it should also be used for low-income and vulnerable families in hard-to-heat homes.

I am listening closely to the hon. Lady, and I admit that the Government have not yet come forward with our proposal on the ECO. She seems quite clear about what it should involve, but I did not pick up the actual figure that she thinks would be right for it. Will she tell us what she thinks that figure should be, so that we can work out whether the sources of revenue would be sufficient to fund it?

I thank the Minister for his intervention, and I am pleased to see his impatience for me to get to the crunchy bits involving the figures, which I will now do. The figures that I was quoting were from an all-party group chaired by the hon. Member for Southampton, Test that involved myself and a few others. The group believed that it would be necessary to have a minimum of £2.5 billion in the ECO pot specifically for low-income and vulnerable households involved; some members of the group felt that it should be £4 billion. We were therefore looking at between £2.5 billion and £4 billion, but that was intended not for solid-wall insulation in the able-to-pay sector; it was focused solely on low-income and vulnerable households.

We considered where we might be able to find such sums of money, including down the back of the sofa and so forth. Based on the Treasury’s own budgetary projections, the EU emissions trading scheme and the carbon floor price will bring in a combined revenue of £2.7 billion in the first year of the green deal’s operation, 2013-14, rising to £3.6 billion by 2015-16. If we were to choose to hypothecate those two revenue streams alone, they could be used to supplement the revenues of the ECO. That is exactly what many groups and individuals have recommended. A 2008 European Parliament directive recommended that at least 50% of revenues from EU ETS auctions of allowances should be devoted to environmental protections, including more efficient heating and improved insulation. In contrast to the UK, countries such as Germany, Hungary and Poland are doing exactly that.

Ofgem provided constructive support in its report to the Chancellor of the Exchequer in 2008, stating:

“In view of these pressures on prices the regulator has identified a windfall to the electricity industry arising from the free allocation of tradeable emission permits.”

That windfall still exists. The report continues:

“This could be used to fund aid for fuel-poor households: those who spend more than 10 per cent of their income on energy.”

The European Parliament and Ofgem are thus both in favour of such a move.

The hon. Lady mentioned hard-to-treat homes and solid-wall insulation. Is she saying that those who are able to pay should not benefit from the ECO?

If money were no object, I would love to see hard-to-treat homes subsidised through the ECO, even for those who are able to pay. We are living in financially constrained times, however, and I am therefore suggesting that we focus all the money in the ECO, which should be increased, on low-income and vulnerable households, of which a subset would be those low-income and vulnerable households in properties that are hard to heat and therefore need solid-wall insulation.

If the hon. Lady is not prepared to subsidise solid-wall insulation, does she accept that many able-to-pay customers will baulk at the substantial cost of such insulation, so there is a very real risk—it is almost certain—that we would be unable to hit our CO2 reduction targets? All the analysis of this problem that has come from a climate change or environmental perspective is absolutely clear that we will need to subsidise these currently expensive measures.

I thank the Minister for his intervention. I hope he will allow me to explain my proposal. It would mean that for at least the first three years the ECO would be used for the low-income and vulnerable families that live in hard-to-heat homes. As about 40% of the low-income and vulnerable households do live in such homes, I am confident that if the revenues from the ECO were focused on that group of people, we would have a much greater uptake of solid-wall insulation and the price would come down far more quickly. If we were to use the bulk of the ECO to go house to house or street by street to some of the poorest, most vulnerable people, I believe it would have a far better environmental impact than sitting back and allowing market forces to see who happens to ring up the advice line to say, “By the way, I’m living in poverty in a hard-to-treat home, so could I have some support from the ECO?” What I am suggesting would be better for dealing with fuel poverty and also better for the environment—the figures suggesting that do stack up.

Was the three-year time scale you mentioned the period over which you envisage this £2.5 billion to £4 billion ECO operating? If not, what time scale are you looking at for the generation and use of the ECO in this way?

I thank the hon. Member for his intervention. I think he is asking me whether, over those three years, I envisage a pot of money of between £2.5 billion and £4 billion, replenished on an annual basis, being used only for these low-income and vulnerable households. If that was the question, the answer is yes.

For how much longer, then, will it go on for the groups that your all-party parliamentary group spoke up for? Is a 10-year programme envisaged for that level of investment? Do you have a longer time scale in mind?

Order. Before the hon. Lady answers, let me say that the hon. Gentleman has been here long enough to know that he should address the Chair, that I am “you”, and he should not therefore ask me what my views are. The hon. Lady should be referred to as either his hon. Friend or the hon. Member.

Thank you. I commend to the hon. Gentleman the report of the all-party parliamentary group, which was co-chaired by myself and the hon. Member for Southampton, Test, as it contains all the detail in it. Off the top of my head, I cannot remember the overall number of years, but my essential point is that both for attacking fuel poverty and for environmental rigour, it makes more sense to target all the ECO resources for at least the first three years on low-income, vulnerable households, including those living in solid-wall and hard-to-heat properties, rather than trying to separate out the ECO into hard-to-treat homes that might belong to able-to-pay groups. A focus for at least three years solely on low-income and vulnerable households would have stronger fuel poverty and environmental outcomes.

Let us not forget that the Government are still bound by their statutory commitments to the eradication of fuel poverty in England by 2016. If that objective is to be met, we need significant additional resources for programmes that will improve heating and insulation standards in dwellings occupied by those households. An impoverished Exchequer, a coalition Government who are averse to high taxation and a policy of funding a range of programmes through levies on consumer bills can only exacerbate the appalling scale of fuel poverty. I think we need a major investment in a national programme to improve domestic energy efficiency, giving priority, as I say, to those in greatest need.

Does the hon. Lady accept that the Government are taking other measures? For example, in the recently published public health paper, the eradication of fuel poverty is highlighted as a public health outcome for the very first time. If health and wellbeing boards are established, they will play a critical role, and they will have additional funds to target on this issue. There is already very good partnership working in such counties as Cornwall—between Community Energy Plus and the local authority, for example—and it is targeting precisely the households that the hon. Lady mentions. That is another way of tackling fuel poverty.

I thank the hon. Lady for that intervention. I welcome the fact that health and wellbeing boards are now interested in fuel poverty, although whether that will bring significant new resources into play is another question. I hope that the hon. Lady is right, but I am not convinced that she is, or at least that there will be enough resources without hypothecation of some of the revenue sources from emissions trading and so forth.

New clause 18 would allow fuel poverty and energy efficiency programmes to be better targeted at those in greatest need through the sharing of data between the Government and energy companies, with all due consideration for privacy and data protection issues. I believe that such improved targeting would also reduce wasteful administration costs, which have been estimated at about £120 per household. Money spent on trying to identify low-income and vulnerable consumers would be much better spent on helping them out of poverty.

I strongly support amendments 2 to 5, tabled by the hon. Member for Manchester, Withington and signed by me. I had tabled similar amendments to improve clause 42, but withdrew them to support those tabled by the hon. Gentleman.

It is no exaggeration to say that the citizens of Northumberland are often faced with a straight choice between heating and eating. I am lucky enough to represent 1,150 square miles of south and west Northumberland, and while in the rest of the country 6 million people—one in 10—may suffer from fuel poverty, it is well accepted in my constituency that the position is far worse there. The north-east has the second highest level of fuel poverty in the country, and we take the issue very seriously.

I support what the Government are doing in the Bill and with the green deal. It is a wonderful step forward. Listening to the hon. Member for Liverpool, Wavertree (Luciana Berger), one might have believed that nothing had happened since the present Government came to office, that everything had been rosy in the preceding 13 years, and that fuel poverty magically mushroomed out of nowhere in May 2010.

I want to discuss energy efficiency and fuel poverty in the context of new clause 19, which was presented very impressively by my hon. Friend the Member for Basildon and Billericay (Mr Baron). My constituency is particularly affected in the context of oil and liquefied petroleum gas, although we are obviously affected by other energy issues. I applaud all the efforts to improve the energy efficiency of homes through the green deal, but I am concerned about, in particular, the variances in the price of heating oil and LPG. We discussed the issue during an important debate in Westminster Hall in January to which a number of Members, including the hon. Member for Ynys Môn (Albert Owen), made impressive contributions. I hope that that debate is a source of ongoing development in relation not just to the Bill and the green deal, but to other proposals made by the Government.

Fuel poverty is not an abstract issue. It is talked of as though it affects other people, but account should be taken of the sheer increase in fuel prices. The price of heating oil in Northumberland, for instance, rose from approximately 41p to 71p in the three months between September and December last year. That is a massive price rise. Everyone accepts that prices are affected by consumption and by oil and gas prices generally, but there is undoubtedly an element of profiteering, and naked monopolies and cartels have been created by individual companies. We have campaigned strongly on the issue.

It is well known that I am no fan of the company known as DCC Energy. I am pleased to say that it is being subjected to an investigation by the Office of Fair Trading, which was launched on 14 March this year and will report in October. I hope very much that the OFT will fully address the difficulties that individuals face. I touch upon this matter because it relates to fuel poverty and energy efficiency. We in Northumberland have at least 20 or 21 fuel companies that provide heating oils and other products. If the practice had not been made public by Members and The Sunday Times—whose campaign I applaud and endorse—it would not be known that all but four of those companies are owned by DCC Energy. Long-standing customers of, for instance, a heating oil company that had been bought-out might be told, “We’re the independent and long-established company that you’ve always purchased from,” when that was manifestly not the case. That company is now clearly controlled by a parent company.

That problem also arises in many other parts of the country, particularly in Scotland. The traditional response of Governments when asked to address the issue of tariffs was that there were too many suppliers, but it is clear that we are now moving towards a situation in which this market is controlled by just a few companies, as in the energy market, which is dominated by the big six. Does the hon. Gentleman agree that it is time that the Government looked at an equivalent to social tariffs in this area?

I would certainly welcome hearing what the Minister has to say on that. The point, however, is that there is regulation of the big six energy companies, but there is no regulation of the heating oil companies and others. I accept that we must wait until we know the results of the Office of Fair Trading investigation, however. After that, we might want to come back to the House and argue that changes must be made.

My hon. Friend is giving a comprehensive account of a problem that we in the west country also face, as there are very high levels of fuel poverty, which is related to the fact that so many people are off the gas grid, and they rely on heating oil and LPG, just as people do in my hon. Friend’s Northumberland constituency and in Scotland. As he says, we must wait for the publication of the OFT’s full findings at the end of the month, but does he agree that its initial findings were welcome in that at least there will now be clarity in respect of websites offering people advice on where to purchase their heating oil? Thanks to the intervention of Members—and especially the Minister, who asked the OFT to look into oil supply as part of the off-grid energy review—this winter, when prices are rising and people are increasingly concerned, at least accurate and fair information will be available on where to purchase heating oil.

I agree with all those points and applaud the efforts of the Government, and especially the Minister, in pursuing the point about websites. One such site, BoilerJuice, is supposedly a price comparison site yet is owned by one company—DCC, unsurprisingly —and it markets only the products it owns. That is manifestly unfair and wrong; it is not good for either the consumer or our constituents in general. I endorse the OFT response, and it is to that company’s great shame that it behaves in that way. I welcome the actions of the Minister, the OFT and especially The Sunday Times, which has done much to help tackle what is, frankly, a scandal.

The message must go out that this issue is about not only what the Government can do through the Bill and the guidance they issue, but about the fact that our constituents must ask questions and shop around as well. They will not be able to do that unless they know who owns the business that is supplying them with fuel or heating oil. If they do not have such information, they will be subject to what amounts to a monopolistic cartel. That is manifestly wrong. We cannot do all the work, however; people must address this issue themselves as well. We have to sell that message to them.

My hon. Friend is being very generous in giving way. Does he agree that there are some very good initiatives in which communities are gathering together to form co-operatives? In villages, people join together, often enabled by voluntary organisations such as Community Energy Plus in Cornwall, to get a better deal for customers in their villages.

I totally endorse that. In certain areas in Northumberland, such as in the communities of Tarset and Allendale, similar approaches are being pursued by local communities’ grouping together and purchasing from a local supplier. In my area, we thought we had 21 different companies but in fact we have one company masquerading as 17 providers and four independents. Fortunately, the four independents have been identified and should be supported; indeed, I assure hon. Members that they will be supported because of the way they are trying to do business and support the local economy and are not an Irish-based provider in a cartel.

Following on from the community projects we have been talking about, I endorse the work of organisations that have addressed this issue and worked to improve the position for the individual consumer and constituent. To their great credit, Age UK and the National Farmers Union have done tremendous work to address the matter. It is worth noting that of the 10 things most likely to be stolen in thefts and burglaries of people’s houses, the sixth-highest is fuel—in Northumberland, the figure is probably even higher. The Countryside Alliance should also be complimented because the rural action that it has proposed is massively successful; it is identifying ways in which the community can be assisted, and not just in farming communities and market towns. In my constituency there is no question but that fuel poverty is an issue in residential parts of places such as Prudhoe, Haltwhistle and west Wylam. Those are not areas of farmland and sheep—they are nothing other than normal houses where people are struggling to stay above the fuel poverty line.

Today, I met representatives of the Young Foundation, which supports The U—a citizens’ university-based organisation in Hexham that is working for specific energy efficiency projects. Those projects are just the sort of thing that will benefit from the green deal in future. They, along with the Green Alliance and several Members of Parliament, are working together to try to provide flagship examples and leadership for the type of constituency and community that is putting green policies at the heart of the community. There is great scope for a community-based way forward to try to strengthen our ability to address energy efficiency.

I support the Bill, but I want to touch briefly on new clause 19, which was tabled by my hon. Friend the Member for Basildon and Billericay. It will be no surprise to hon. Members who have listened to my contributions to hear that I should like to see clarity of provider ownership on bills. At the moment, individual consumers are being misled by their failure to understand which parent company owns particular providers. I accept and endorse my hon. Friend’s comments that new clause 19 is a way forward. It addresses the additional information that should be supplied by energy suppliers on bills and I hope that the Government will support it. It is supported by Which?—an organisation that self-evidently works on behalf of individual constituents and consumers—and a number of other organisations that are greatly to be credited. Anything that ensures that a generic signposting message is displayed prominently on all customers’ energy bills, detailing how they might reduce those bills, should go ahead. We should ensure that such messages are on bills. Indeed, I go further in saying that it would be of great benefit if something were supplied on that issue this year, although I accept that it might be difficult to do that by 1 December given the bureaucracy involved.

I should like to have seen a further subsection added to new clause 19—it is to my detriment that I failed to table an amendment to it—that would have touched on clarity of ownership, but perhaps we can return to that after the OFT has produced its report, when we know what it says about the role of DCC Energy.

I support the Bill and the green deal. The constituency that I represent and the whole of Northumberland is well behind the green deal and the objectives that it seeks to achieve.

It is a pleasure to follow the hon. Member for Hexham (Guy Opperman). I welcome him back to the House. He is in good campaigning mode on fuel poverty and off-grid fuels in peripheral areas of the United Kingdom. I support new clause 1 and the other Opposition new clauses and amendments, but I shall limit my remarks to new clause 19, tabled by the hon. Member for Basildon and Billericay (Mr Baron). He highlighted in his opening remarks how important energy issues are to households and how the price hike of recent months and the trend that is forming are hurting every household in the United Kingdom. That is something that we need to address.

Good measures have been taken by previous Governments and, indeed, this Government with social tariffs, but the market simply does not work for many people. The price hikes are unsustainable, hurting and causing fuel poverty across the country. I welcome new clause 19 when it talks about clarity and simplifying bills, so that people have ready information.

I am glad that the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker) is still on the Front Bench. He is on record as saying that he was so confused by the information available when he tried to switch supplier that he just gave up. I am in the same league as him. Energy companies deliberately give so much information to their potential consumers and customers that they do not bother.

I am a member of the Select Committee on Energy and Climate Change. We have held a number of inquiries and a mini-inquiry when price rises were announced just before the recess. We took evidence from three of the big six companies. There has been a review and there will be further reviews of energy pricing and tariffs and how the companies present their bills. It was interesting that 40% of those who decide to switch supplier are no better off when they do so, and many of them do so under duress; they switch just to get rid of cold-callers. So it is important that we have such a clause as well as other legislation and regulations that allow individuals to have clear and concise bills, so that they can make clear and concise choices and, we hope, reduce their energy prices, thereby reducing fuel poverty.

We will extend the retail market inquiry being undertaken by the Department of Energy and Climate Change to find out more from experts, including consumer groups, which have been helpful. I join hon. Members in putting on record my appreciation of the work done by consumer groups, such as Which?, Consumer Focus and Citizens Advice, in helping to frame proper protection guidelines for energy consumers.

The confusion needs to be addressed, and new clause 19 would go some way to doing so. When I intervened on the hon. Member for Basildon and Billericay to ask whether he would expect the measure to be extended to people off-grid and not on the mains, he said that he would. Of course, such an extension would be difficult because, as has been said in the previous contribution, the off-grid is not a regulated market. I am not sure—I am willing to take an intervention—how he envisages that independent suppliers would do what would be required of the big six, with dual tariffs and so on. Obviously, people without gas supplies cannot get the dual tariffs or other reductions that many people have.

I think I said that subsection (c) of new clause 19 calls for research to choose the best message and consider how to communicate it. I envisage that we could at the very least consider that issue, without making any promises, when subsection (c) was triggered.

I am grateful to the hon. Gentleman for the spirit in which he made his intervention. However, I think that that would be difficult. For some time, I have suggested—the Bill may not be exactly the right place to deal with this, but the electricity market reform White Paper is looking at it—that the regulator should look after people who are off-grid so that they have the same protection and rights as others. As has been said on numerous occasions, people in hard-to-reach areas on the periphery have the greatest need and are in the greatest fuel poverty. They are often off the mains, so they need equal if not better protection than people with access to mains gas and electricity.

I very much agree with the hon. Gentleman. I, too, have called for those changes. Earlier, I was trying to make the point that new clause 19 will not help those people at all because there are no tariffs in that market: there is a set price for the oil that they buy. One of my constituents told me that last winter the supplier would not quote them a price. They had to buy the oil, paying the price set on the day of delivery, as prices were volatile. Unlike gas and electricity consumers, they do not receive a bill so that they can look at those things; they are given a price, and so much oil is delivered.

The hon. Gentleman is absolutely right, which is why those people need greater protection. The Office of Fair Trading is undertaking a review, and I hope that, rather than just refer something to the Competition Commission, it will come up with proposals and take action. I hope—and I know that the Minister is listening, because this is a serious issue—that people who are off-grid receive better protection in future. I shall certainly work with the Government—and I know that the Select Committee on Energy and Climate Change will do so, too—and help them to try to reach those people.

The hon. Gentleman made an important point about the contracts and the sums that individuals have to pay. The hon. Member for Hexham touched on that. I have received anecdotal evidence from my constituents that, during the big freeze in December last year, an individual in an isolated hamlet applied to have their tank filled up. They were told that they could have only half the amount that they usually received, and they were charged 50p a litre. Six weeks later, the company came to replenish the tank, and charged them 70p a litre. Members up and down the country will be familiar with such examples. Those people are suffering real hardship and are in fuel poverty, which is why we should all work together to ensure that people who are off-grid receive the proper protection afforded to those on the gas and electricity mains.

The new clause is a good measure, and we are moving towards clearer bills that include such information: informed people can make informed choices, as I have said. We need that information, and the choice of suppliers should extend beyond the big six. That has been mentioned, and the Government and Ofgem are looking at it. The proposal has cross-party support, because the monopoly enjoyed by the six companies that generate 80% of electricity and gas yet supply 99% of consumers does not produce a fair market. That is why we need intervention and tighter regulations, to achieve the outcome that we all want to achieve: price stability and clarity, so that people know from their bills what percentage of what they pay is going to fund energy efficiency measures, and what percentage is used for external measures such as transmission and so on. Transmission has not been discussed at great length, and it is ironic that people who live at the periphery of the United Kingdom, in areas that generate much of the electricity that goes to the grid, pay more for their electricity and gas than people in other areas.

I cannot resist the opportunity to discuss transmission. Does the hon. Gentleman agree that, in fact, the costs of modernising electricity transmission are minimal compared with the increased prices charged by electricity and gas companies?

Absolutely. To be fair to the national grid, as part of our inquiry into the market, we went to see the National Grid Company which, for the first time, is offering choices and options in transmission, such as underground, overground and subsea. I agree that these hikes are ripping people off. They want choices and if they choose underground and it costs more in certain areas, we might have to consider paying more for it, but at the moment we are getting a poor deal when we have the minimum upgrade to the transmission lines and the infrastructure, and are paying the maximum amount through our bills. That balance needs to be addressed.

I realise that time is of the essence, but in closing I want to highlight the point about off-grid so that all households in the UK are treated equally. We need to ensure that we have a level playing field for people in peripheral areas as well as in large towns and cities when it comes to the green deal and paying for electricity and gas. I am sure that there is consensus on this and we need to move forward.

I congratulate the hon. Member for Basildon and Billericay on raising this important point about simplicity, the changing of the tariffs and how we can get a better deal for all those whom we represent, because at the moment they are being ripped off.

I shall speak to all the amendments tabled by the Opposition and Back-Bench Members in this group. The first important cluster of amendments covers the green deal. I thank hon. Members for all the amendments and the opportunity, even where we have not agreed, to debate a set of issues that are of particular significance to all our constituents. As we look towards the winter, people will be looking to us for leadership on the important issues of our energy bills and energy efficiency.

I start with amendment 1, tabled by the hon. Members for Ogmore (Huw Irranca-Davies) and for Liverpool, Wavertree (Luciana Berger), and new clauses 1 and 2, also tabled by the hon. Members and by the hon. Member for Rutherglen and Hamilton West (Tom Greatrex). The amendments might appear to duplicate existing legislation, but they raise important issues. On our aims for meeting carbon budgets and tackling fuel poverty, legislation already exists to compel this, as the amendments highlight. There is no doubt about the coalition Government’s commitment to both those issues, and we have already met our first and second carbon budgets and published our strategy for the third. We will be publishing our strategy for meeting the fourth carbon budget in the 2020s this autumn.

As I have said, the green deal and the ECO must be seen in the context of our overarching carbon budgets. The amendments tabled by the hon. Member for Southampton, Test (Dr Whitehead) emphasise the importance of taking a broad view to maximise cost-effectiveness. Our strategy will set out the role played by the green deal and the ECO in support of the green deal. We have already committed to report to Parliament specifically on this.

The Climate Change Act 2008 already obliges us to justify any shortfall and to take action to address it. Likewise, the Act also enables the Committee on Climate Change to provide advice, which I will come to later. This aim commits the Government to ensure household energy efficiency makes a fair and appropriate contribution to delivering our existing legally binding carbon budgets. We will report each year on what our energy efficiency policies are delivering and to what extent they contribute to the carbon budgets. It will be clear to all who wish to challenge us if our policies are underperforming. That is already in the Climate Change Act or in the Bill.

Only English households are covered because energy efficiency is a devolved matter. It is not for the UK Government to dictate the ambitions of the Government of Scotland and the Welsh Assembly, but we are working in tandem with devolved Administrations, and I have been pleased with the way in which, particularly at official level, but also at a political level, there has been real agreement. We are definitely heading together in the right direction.

Amendments 9 to 12, tabled by the hon. Member for Southampton, Test, relate to energy efficiency in a broader sense. I certainly support the principle behind them. He is right to say that successive Governments have ignored at their own expense—or rather, at ours—the compelling argument in favour of energy efficiency improvements before leaping to build new generation capacity, and they have failed to pick up the money available from energy efficiency action on the ground. Energy efficiency within that spectrum of measures must always focus on the most cost-effective savings. Cost-effectiveness is enshrined in policy making within the coalition, and all existing energy efficiency policies come with impact assessments for that purpose. The costs and benefits for UK plc are always in the foreground, not stuffed into the small print. It is for this reason that we propose the green deal as a market mechanism. We will publish an updated impact assessment of the green deal and the ECO, along with a consultation and full details of the secondary regulation, next month.

I assure the hon. Gentleman, who has a substantial record of campaigning and contributing to serious debate on energy efficiency, that it is something my Department now takes far more seriously. We are not just using words to show this, and it goes beyond the green deal. The green deal is clearly a radical, ambitious and key part of our efforts and a flagship policy of which we are extremely proud, but it is certainly not the end of the story. We will establish by the end of the year a new energy efficiency deployment office to deliver energy efficiency; it will sit within the Department alongside the office for renewable energy deployment and the office for nuclear energy deployment, and with equal weight. For too long, and for some extraordinary reason, while successive Governments have exalted the building of new energy generation capacity, energy efficiency, when not ignored altogether, has been dispersed around the Department. It will now have its rightful place in the Department’s hierarchy of actions and priorities.

I am happy to meet hon. Members privately to explain in detail our plans for bringing together the energy efficiency deployment office. It will not only be a first for the UK, but set a precedent around the world. In the international forums I attend, I have found real interest in what we are doing. We are looking at new market models that have not been tried anywhere else. We will certainly look abroad for best practice to build on, but I really think that we will come up with something that has a leading edge.

The energy efficiency deployment office will be tasked with identifying ways of driving further carbon abatement across the economy, which the hon. Gentleman seeks in his amendment, and learning from best practice in other countries. At the heart of its mission, as expressed in the amendment, will be analysing the cost-effectiveness of energy efficiency and energy generation, and it will have the resources to do that. We are recruiting the senior staff with appropriate experience to drive that effort. I hope that that satisfies him and that he is content not to press his amendment to a vote.

The amendments also raise the important matter of the role of non-domestic buildings in the green deal. I assure the House that, as I have said on many occasions, the green deal is an opportunity not only for homes and households, but for businesses and communities. There will be more detail in the consultation document, which we intend to publish next month, about how the green deal will be tailored for non-domestic—invariably business—customers. The UK’s building stock is a key sector of our annual carbon reporting, so the green deal’s contribution to both domestic and non-domestic buildings will be covered. I take the green deal’s contribution to our carbon budgets very seriously, which is why I tabled an amendment in Committee to include in the Bill that reporting commitment, as many stakeholders and other members of the Committee suggested.

In Committee we discussed at great length local authority carbon emissions and the role that local authorities have to play in producing and taking ownership of plans to reduce carbon emissions in their area. Hon. Members’ proposed changes—new clauses 3 and 4, tabled by the hon. Members for Ogmore, for Liverpool, Wavertree and for Rutherglen and Hamilton West, and amendment 21, tabled by the hon. Member for Gower (Martin Caton)—deal with the role of local authorities in tackling climate change, and I cannot agree more wholeheartedly that they have a key role to play if we are to meet our national carbon reduction targets and to maximise the benefits of, for example, the green deal.

During our debates in Committee I spoke about how we are working with local government, and since then I have had more opportunity to see at first hand the considerable enthusiasm among many local authorities to engage with the climate change agenda, as demonstrated in the memorandum of understanding between my Department and the Local Government Group. I am delighted that under that MOU a new Nottingham declaration on climate change is being consulted on and is planned for publication this autumn. It demonstrates that councils are able to take the lead without central Government diktat.

We have already announced our intention to retain the Home Energy Conservation Act 1995 in England, providing a mechanism already on the statute book to encourage councils to play a key role, to keep track of their progress and to take action when they fail to step up to the mark. Much of the effectiveness of the 1995 Act will lie in the new guidance that we provide. That will give us the opportunity not only to work with the grain of voluntary activity, with the enthusiasm that we see and with the work that is already under way, but, where appropriate, to focus councils on some of the specific—perhaps new—areas that the proposed changes to the Bill cover.

I have been listening very carefully to the Minister, but I do not quite get how we will measure that, in order to ensure that we are successful.

As the Bill Committee and, in particular, the Chairman of the Environmental Audit Committee suggested I do, I have already met Lord Turner of Ecchinswell and the Committee on Climate Change to discuss how it might inform the guidance that the Government are preparing to help local authorities cut carbon emission in their areas. I expect that the framework and the guidance that the CCC provides will help to answer, at least in part, the hon. Lady’s question. I expect a formal proposal from the CCC shortly; when we met, Lord Turner certainly took on board how crucial it is that the Committee’s advice be completed early next year, so as to feed into the permissive guidance for local authorities being developed by the Department for Communities and Local Government.

Will the Minister undertake to make Lord Turner’s advice available to Members who sat on the Bill Committee and, indeed, to my hon. Friend the Member for West Ham (Lyn Brown), so that we might see exactly how it will operate?

I am very happy to do so. Indeed, I am sure that Members will have further ideas on how to build up the advice that we give local authorities. Given that it will go to councils of every political party, it is important that it is seen to be thoroughly objective, so a sense of co-ownership would indeed be very helpful.

New clauses 7 and 18 and amendment 24 deal with the ECO and fuel poverty. The hon. Member for Brighton, Pavilion (Caroline Lucas), who tabled new clause 7, may recall what I said in Committee in response to a similar amendment: that the Treasury is responsible for the allocation of public funds. Putting a duty on the Secretary of State to report on potential uses of central Government revenues would, I am afraid, conflict with the Treasury’s responsibility. I assure her, however, that the Government are taking great care to ensure that their policies in the round will be up to the task of delivering our climate change and fuel poverty objectives. The ECO is a key part of this, and we will make sure that it has the right level of ambition to achieve our goals without putting an unduly heavy or inequitable burden on energy bills. On that basis, I hope that the hon. Lady will not press the amendment.

Amendment 24, tabled by the hon. Members for Liverpool, Wavertree and for Ogmore, and new clause 18, tabled by the hon. Member for Brighton, Pavilion, focus on data sharing. Although I understand the intent of the proposal, we do not need it now because the existing warm home discount scheme will provide the six major energy suppliers with the details of more than 600,000 older poorer pensioners this winter and information on thousands of further customers over each of the three subsequent years. That information will be used to provide a £120 rebate this winter to those customers, but it can also be used to provide the customers with additional advice, including information about the ECO. Additional powers for further data sharing are therefore not necessary at this time.

The forthcoming ECO consultation will report on the likely impacts of the policy, as will the accompanying impact assessment. The type of statutory duty that amendment 24 would introduce is not necessary for the purpose of showing the intended impact that the ECO will have on fuel poverty and the energy efficiency of properties. I can therefore assure the hon. Members for Liverpool, Wavertree and for Ogmore that the intentions of the amendment are already met in full.

Amendments 2 to 8, 19, 47 and 48 deal with the private rented sector provisions. These were tabled by the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), the hon. Members for Manchester, Withington (Mr Leech), for Brighton, Pavilion, for Leeds North West (Greg Mulholland), for Foyle (Mark Durkan), for Liverpool, Wavertree and for Ogmore, and my hon. Friend the Member for Hove (Mike Weatherley). Amendments 6, 7, 19, 47 and 48 relate to timing issues, and I will consider those first, albeit briefly.

As we debated in Committee, we are providing landlords with a firm legislative position. The tenants’ energy efficiency regulations must come into force no later than 1 April 2016. Under those regulations, tenants will be able to ask for consent from their landlord to make relevant energy efficiency improvements such as those funded under the green deal or ECO, and their requests cannot be unreasonably refused. Amendments 7 and 48 propose that the regulations on tenants’ right to request should be introduced sooner, but as well as regulatory certainty, we need to provide landlords with a reasonable period in which to prepare and get up to speed with the regulations. The dates we have chosen strike a balance between pursuing greater energy efficiency benefits and giving landlords time to prepare.

I draw the House’s attention to the latest survey, published this week, which clearly shows that two thirds of landlords are keen to act and take up the green deal, and that only a relatively small minority—fewer than 20%—are dragging their feet. There are grounds to be optimistic that landlords are not resisting this agenda. We have set the dates of 2016 and, as a backstop, 2018, but I cannot reiterate strongly enough—

I will not give way, because I have to get through these points.

The backstop is 2018—the point at which we must cross the finishing line. Clearly, in the five years to 2018, from the point at which the green deal goes live, it will be up to the Government to monitor progress in the private rented sector. If we see that there is not a significant glide path towards being able to complete by 2018, it remains to us to take further measures and actions, and we will. [Interruption.] If the hon. Member for Brent North (Barry Gardiner) had been in the Committee, he would know that we will have available an improved online register that is much better than the existing data facilities. We will have the information, we will monitor it carefully, and we certainly see the 2018 date as the end line and reserve the right to introduce new powers, measures, regulations and incentives to drive uptake if we do not see it happening.

Amendment 4 considers the implementation of the minimum standard. The principle behind the amendment is that all F and G-rated properties should be brought up to the minimum standard, regardless of how much of the work can be funded through the green deal. However, the regulations come with safeguards. We do not want our regulations to have an adverse impact on the supply of properties in the private rented sector. For that reason, we remain committed to ensuring that there are no up-front costs for landlords. Landlords will either have to reach an E rating or carry out the maximum package of measures funded under the green deal and the ECO, even if that does not take them above an F rating.

My hon. Friend the Member for Hexham (Guy Opperman) raised a very important point. The Government hear and share the concerns that he expressed so eloquently. We were so concerned by the problems in the domestic heating oil sector last winter that the Minister of State, Department of Energy and Climate Change, my hon. Friend the Member for Wealden (Charles Hendry), asked the Office of Fair Trading to undertake an urgent assessment of the whole off-grid sector. I am pleased to say that it has already taken action to ensure that price comparison websites are genuinely independent. We look forward to its final report next month so that we can see what further steps may be necessary ahead of this winter and ensure that there is proper and effective competition in this important sector, where customers consistently get a very raw deal. The Minister of State is absolutely determined to drive home the agenda that my hon. Friend the Member for Hexham articulated so well.

I turn now to the points raised by my hon. Friend the Member for Basildon and Billericay (Mr Baron) and his new clause 19. This is an area in which he has considerable knowledge and I place on record my thanks to him for taking up the challenge of chairing the consumer billing stakeholder group, which has provided invaluable advice to the Government and has helped to drive forward the aim enshrined in clause 74 of providing consumers with additional information about their suppliers’ cheaper tariffs. My hon. Friend makes the good point that we should seek to provide consumers with helpful, clear information at the earliest opportunity, and that we should build on that through research informed by consumer groups and consumer responses. His new clause would put a set of specific implementation actions in the Bill.

As my hon. Friend is aware, because he has been essential to the steps that the Department is taking, we are on exactly the same page as him on identifying what needs to be done to give the consumer the best possible information. This winter we are doing what can reasonably be achieved, with a clear signpost on bills that will start going out in the next few weeks. There will then be an urgent communication—a letter in most cases—advising consumers of the advantages of switching. I greatly welcome the suggestion that that campaign be backed by consumer groups such as Which? and Consumer Focus to encourage a better take-up than sometimes results from similar mail. We are awaiting the recommendations of the retail market review. If we judge that it does not go far enough, we will look to go further and we have the back-stop of being able to legislate. I have conveyed clearly to the energy companies what we expect and that we will not hesitate to legislate if they do not come to a voluntary agreement.

In short, does the Minister accept the three recommendations of the billing stakeholder group, which are contained in new clause 19? I accept that we do not need to press the matter and put them in the Bill.

I broadly support those recommendations, although we might have to address some of the detail, such as the nature of the communication. We want to ensure that we have the best possible advice. However, I am happy to confirm that we are on exactly the same page in broadly supporting the three recommendations my hon. Friend has made.

In summary, although I am sympathetic to the well intentioned principles behind many of the amendments, and I apologise if I have been unable to speak in detail to some of them, I hope that the hon. Members for Liverpool, Wavertree, for Ogmore, for Rutherglen and Hamilton West, for Southampton, Test, for Brighton, Pavilion, and for Gower, and my hon. Friend the Member for Basildon and Billericay, have found my reassurances, explanations and commitments satisfactory, and that they consider not pressing their proposals to a Division, given that we have moved a long way since the Bill was first published—

Debate interrupted (Programme Order, 10 May).

The Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83E), That the clause be read a Second time.

Mr Speaker then put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83E).

Clause 1

Green deal plans

Amendment made: 29, page 2, line 29, at end insert—

‘, and

(d) recovered and held by the relevant energy supplier as agent and trustee for the person who made the improvements (unless the relevant energy supplier is also that person).’.—(Chris Huhne.)

Clause 3

Framework regulations

Amendment made: 30, page 4, line 41, at end insert—

‘(ea) requiring green deal assessors to act with impartiality;’.—(Chris Huhne.)

Clause 8

Confirmation of plan

Amendment made: 31, page 8, line 35, leave out from ‘takes’ to ‘in’ in line 36 and insert—

‘one or more of the following actions as required by the framework regulations’.—(Chris Huhne.)

Clause 12

Disclosure of green deal plan etc in connection with sale or letting out

Amendments made: 32, page 10, line 32, after ‘must’ insert—

‘, in relation to the document, or each document, required to be produced or updated as mentioned in section 8(4)’.

Amendment 33, page 10, line 33, leave out from ‘document’ to ‘has’ and insert—

‘or, if the requirement to produce or update the document’.—(Chris Huhne.)

Clause 13

Disclosure of green deal plan in connection with other transactions etc

Amendment made: 34, page 11, line 22, leave out from ‘obtain’ to ‘has’ and insert—

‘a document required to be produced or updated as mentioned in section8(4) or, if the requirement to produce or update such a document’.—(Chris Huhne.)

Clause 21

Powers under sections 17 to 20: consultation

Amendment made: 35, page 17, line 11, leave out subsection (2).—(Chris Huhne.)

Clause 39

Regulations and orders

Amendment made: 36, page 26, line 32, leave out subsection (14).—(Chris Huhne.)

Clause 42

Domestic energy efficient regulations

Amendment proposed: 4, page 28, line 7, at end insert

‘such that the property shall not fall below the level of energy efficiency specified in subsection (1)(c).’.—(Mr Leech.)

Question put, That the amendment be made.

Amendment proposed: 47, page 28, line 33, leave out ‘April 2018’ and insert ‘January 2016’.—(Luciana Berger.)

Question put, That the amendment be made.

Clause 76

Power to modify energy supply licences: procedure and supplemental

Amendment made: 37, page 57, line 15, leave out subsection (2).—(Chris Huhne.)

Clause 80

Power of the Gas and Electricity Markets Authority to direct a modification of the Uniform Network Code

Amendment made: 38, page 61, line 5, leave out from ‘consultation’ to ‘the’ in line 6 and insert ‘before, as well as consultation after,’.—(Chris Huhne.)

Clause 97

Modification of particular or standard conditions

Amendment made: 39, page 79, line 7, leave out subsection (4).—(Chris Huhne.)

Clause 117

Commencement

Amendments made: 40, page 95, line 32, at end insert—

‘(ia) section [Agreement about modifying decommissioning programme] (agreement about modifying decommissioning programme)’.

Amendment 41, page 95, line 34, at end insert—

‘(ja) section [Adjustment of electricity transmission charges] (adjustment of electricity transmission charges);’.

Amendment 42, page 95, line 44, leave out first ‘section’ and insert ‘sections [Consultation] and’.—(Chris Huhne.)

Schedule 3

Repeals and revocations consequential on section 115

Amendment made: 43, page 101, line 5, leave out Schedule 3.—(Chris Huhne.)

Title

Amendment made: 44, line 12 leave out ‘by a National Park authority or the Broads Authority’.—(Chris Huhne.)

On a point of order, Mr Speaker. Have you received a request from a Treasury Minister to make an urgent statement to the House about the news that the Treasury is about to sue the European Central Bank, as that is being reported in the media at the moment?

No, I have not. The hon. Gentleman is ahead of me. He has heard of information of which I have not heard. I have, however, now heard of it, and I am grateful to him.

Third Reading

Queen’s and Prince of Wales’s consent signified.

I beg to move, That the Bill be now read the Third time.

I begin by thanking the many hon. Members who have contributed so much to the discussions on the Bill. The hon. Members for Hackney South and Shoreditch (Meg Hillier), for Liverpool, Wavertree (Luciana Berger), for Ogmore (Huw Irranca-Davies), for Rutherglen and Hamilton West (Tom Greatrex), for Blaydon (Mr Anderson), for Hyndburn (Graham Jones), for Wansbeck (Ian Lavery) and for Southampton, Test (Dr Whitehead), who is my constituency neighbour, put a lot of work into the Bill during its lengthy consideration in Committee. I extend my thanks to the hon. Member for Bolton North East (Mr Crausby) and my hon. Friend the Member for Gainsborough (Mr Leigh) for chairing the Bill Committee, and to the hon. Member for Brighton, Pavilion (Caroline Lucas), who worked tirelessly and made a substantial contribution to the debate, for which I am extremely grateful.

On the Government Benches, I should like to extend my gratitude to the hon. Members for Richmond Park (Zac Goldsmith), for Mid Norfolk (George Freeman), for Stourbridge (Margot James), for Devizes (Claire Perry), for Winchester (Mr Brine), and for Stratford-on-Avon (Nadhim Zahawi), and to my hon. Friends the Members for Norwich South (Simon Wright) and for Wells (Tessa Munt), for the dedication that they have shown in scrutinising the Bill in its passage through the House. I also thank my officials, who have worked extremely hard to develop the Bill and who helped Members with their inquiries.

The centrepiece of the Bill is the green deal, an innovative finance mechanism to release capital for energy efficiency. The green deal is the first measure of its kind anywhere in the world, and it allows a payback to investors over long periods beyond the normal tenancy or period of owner-occupation, so that householders do not have to pay any of the cost up front, and much more energy saving becomes affordable. It creates a new market in energy saving that will cut energy bills, ensure against future price rises, provide local jobs, boost green businesses and improve our nation’s energy security. We have worked hard to allow hon. Members to scrutinise the provisions in detail, and I believe that the proposal has been strengthened.

Does the Secretary of State accept that wind farms have generated serious concerns all over the country? Does he accept, too, regarding his proposition on the value of the Bill, that the consumer tariff in fact pays significantly for the destruction of the countryside?

I am grateful to the hon. Gentleman for his intervention. The bulk of the Bill is about energy efficiency and energy saving, which means that we will need fewer types of electricity generation of all descriptions, including windmills. I disagree with him, as I think that windmills are beautiful and we should have a lot more of them. They provide the most economical form of renewable energy, and I trust that he will come up with ideas for many more windmills in and around his constituency.

There are provisions in the Bill for a new energy company obligation, or ECO, which is critical for delivering carbon savings in homes that are hard to treat. It will protect the most vulnerable groups and those on the lowest incomes, focusing on households that cannot afford to heat their homes adequately. The provisions relating to the private rental sector are a significant step forward. They are designed to increase efficiency to protect tenants in some of the worst housing and to boost overall carbon savings.

The Bill contains a number of provisions relating to energy markets and infrastructure. It ensures that I will have sufficient information to publish an assessment of future electricity capacity requirements, and that I have a duty to do so. That sits alongside the much more significant package of reforms covered in the electricity market reform White Paper. To improve security of supply, the Bill contains powers that, if taken, will give incentives to gas providers to continue to supply their customers, should Britain suffer its first gas supply emergency. Through this Bill, we will be able to de-designate areas of our continental shelf—a small but important amendment to the existing legal situation. Should negotiations between industry players over access to infrastructure in the North sea break down, the Bill gives us the ability to intervene and work to find a resolution, so that our energy security will not suffer.

The Bill contains powers to ensure that the interests of consumers are paramount. For example, we have taken powers to oblige suppliers to specify whether a cheaper tariff is available.