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Oral Answers to Questions

Volume 563: debated on Thursday 6 June 2013

Energy and Climate Change

The Secretary of State was asked—

Per Capita Carbon Emissions

1. What recent discussions he has had with his counterparts in Germany, the Netherlands and Ireland regarding the level of per capita carbon emissions and the future policy of those countries. (158073)

I frequently have talks with my German, Dutch and Irish counterparts. In April, for example, I attended informal energy and environment councils in Dublin, where discussions with other member states, including Germany, the Netherlands and Ireland, focused on the EU 2030 climate and energy framework.

The March European Environment Agency report confirmed that the UK’s per capita emissions are among the lowest in Europe, and in 2011 they fell at double the rate of those of the rest of the EU. Furthermore, the recent emissions trading scheme vote by the European Parliament means the UK has a carbon price six times higher than the rest of the EU, and now we are seeing several countries moving ahead to build coal stations that will not use carbon capture and storage. Is there a risk that we are increasingly acting unilaterally in this area?

Let me reassure my hon. Friend. We work very closely with our European colleagues, and I formed the green growth group, currently working with about nine other member states, including our German and Dutch colleagues. We need to reform the ETS to make sure we have a functioning and effective carbon market in Europe, and we also need an ambitious 2030 target for greenhouse gas emissions. The UK Government have agreed that we will seek a 50% target in the context of winning a global climate change treaty.

What is the point of us closing coal-fired power stations if Germany is opening 20 of them? What is the point of us having a carbon tax and reducing emissions if we thereby release trading permits for other countries in Europe to emit more carbon?

I am grateful to my right hon. Friend for his question. He is not right about the German position, and I refer him to the April 2013 report by Pöyry, which we commissioned and which is on our website. It examines the reality of what is happening with new coal-fired power stations in Germany, the Netherlands and Spain. Some 10 new coal and lignite coal projects are under construction in Germany, because the final investment decisions on them were taken in 2005 and 2008, when there was a very different policy environment, but four have been postponed and 22 have now been abandoned, so the situation in Germany is different from the one my right hon. Friend describes.

Carbon emissions per capita statistics fail to recognise the effect of imports and exports on consumption. Will the Secretary of State confirm that he will not seek to meet UK targets through policies that close down our energy-intensive industries, thereby exporting jobs and importing carbon?

My hon. Friend is right. We do not want to see carbon leakage; that would not help the climate, and it would not help our economy. That is why I agreed with my right hon. Friend the Secretary of State for Business, Innovation and Skills a very generous package, working with the Chancellor, to compensate energy-intensive industries for the indirect costs of the ETS and the carbon price floor, and it is also why we have exempted energy-intensive industries from the costs of contracts for difference. We want to ensure we make progress on climate change, but we also want to ensure we keep successful businesses in the United Kingdom.

Energy Bills

This coalition Government are determined to help hard-working families with the cost of living. We have a range of initiatives to help with energy bills. From the Prime Minister’s proposals to get consumers on to the cheapest energy tariffs to our flagship green deal, and from the warm home discount to our promotion of collective switching and building a more competitive energy market, this Government are putting the consumer first.

The Minister must be aware that the respected think-tank the Institute for Public Policy Research has produced a report that shows that if the energy market were more competitive, bills could be reduced by at least £70 from efficiency savings alone, so why will he not get behind Labour’s plans to break the dominance of the big six by ensuring that they supply energy into a pool to enable more businesses to access the market and to bring down bills for customers?

The hon. Gentleman will forgive us if we do not take lessons on how to widen the big six from the party that created the big six. When Labour came to office there were 14 major participants in the energy sector; when they left office, the number had shrunk to six. We believe our radical energy market reforms that are going through the House are the way to bring in real competition.

Does the Minister agree that making bills simpler and easier to understand is a big step towards empowering consumers to allow them to make the best choices and get the best deals?

Absolutely. My hon. Friend is, as ever, spot on. We have been working very closely with Ofgem to ensure that consumers are not baffled by the information on their bills and that they can make informed choices. Our market reforms will make it even easier for them to get the best deal.

12. This House was told that the green deal would be the biggest home improvement scheme since the second world war, creating thousands of jobs and hundreds of new businesses. If that were true, why does Enact Energy, which has been in the insulation business for 20 years, cite late payments from the green deal as having put it into administration, resulting in the laying off of all its staff? (158087)

Obviously, we are very sorry when any business goes into administration, but I think the hon. Gentleman is being a little hasty. It is very early days for the green deal and for one business that, sadly, has gone into receivership there are dozens, if not hundreds, of new small and medium-sized enterprises that are starting up to come into the new competitive marketplace that we are creating.

What steps are being taken to stop profiteering by the National Grid, which can charge a fortune to move or change a domestic meter?

If my hon. Friend has real evidence of profiteering, we would love to see it. If he shares it with us, we will take steps to crack down on it.

Does the Minister agree that smart metering gives the consumer—the householder—real information on how much energy they are using? How quickly can we get smart metering into every home in Britain, hopefully along with a carbon monoxide detector that will save people’s lives?[Official Report, 12 June 2013, Vol. 564, c. 1MC.]

First, on carbon monoxide detectors, the hon. Gentleman is the champion in this House of that very important technology and I thank him for his engagement with my Department. We are working closely to ensure that the green deal will push through the roll-out of carbon monoxide detectors.

On smart meters, we now have what we believe to be the most ambitious programme in Europe, beginning in earnest in 2014 and completing by 2019. It is very exciting and very radical.

On 12 occasions the Prime Minister has promised to force the energy companies by law to put everyone on to the cheapest tariff, but clause 121 of the Energy Bill clearly states that the power to require an energy company to change a customer’s tariff applies only to people on closed tariffs. There are 25.5 million households in Britain. How many are on closed tariffs?

I cannot give the right hon. Lady the exact figure off the top of my head, so I will write to her on that. The Labour party is in complete denial. The Prime Minister pledged radical action to put everyone on to the cheapest tariffs for them. We have come forward with a solution and we have put it into law; the Opposition had 13 years to do that and did nothing for consumers. We are taking radical action to cut through the swathe of tariffs that they left consumers when they left office.

I have tabled written questions, I have asked Ofgem and now I have asked the Minister, and nobody can tell me how many people will find themselves on a better deal, let alone save money.

Let us look at another promise. On Tuesday, the Secretary of State told the House that the Energy Bill would give Ofgem the power to force energy companies to compensate consumers, something I called for in October 2011. Ofgem is undertaking 15 formal investigations with another 12 cases at informal review stage. Will the Minister confirm that even after the Energy Bill has received Royal Assent and even if there is evidence of wrongdoing in any of those cases, Ofgem will have no powers to force the companies to pay a single penny in compensation to their customers?

It is a big pity that the right hon. Lady first started taking an interest in these matters in 2011 and not during the 13 years for which Labour was in government when it did nothing to address those issues for the consumer. I am happy to say that our Energy Bill takes those issues into account and Ofgem will be able to take them into account as the investigations go through. This Government are putting the consumer first after 13 years of inaction from Labour.

Decarbonisation Target

4. What his assessment is of the potential effect on the UK wind industry of not setting a target to decarbonise the power sector by 2030. (158077)

The Government have listened to a wide range of views on the issue of setting a decarbonisation target and have legislated to set one. We fully recognise that investor certainty is essential to delivering our energy and climate goals at the least cost and have already provided very clear signals to industry about the long-term trajectory of the electricity sector; for example, through our commitment to the levy control framework, through the Energy Bill, through carbon budgets and through our commitment to ambitious long-run targets on renewables, power sector decarbonisation and carbon emission reductions.

When I asked the Prime Minister yesterday to show some leadership and stand up for British business and green jobs by setting a target, he claimed that business was against it, but when the Secretary of State was asked earlier, he could not name a single business that opposed it. Can he now name a business that has thanked him for voting against the target?

The hon. Lady needs to look at what has happened. We have drafted the legislation so that we can set a target and that has been welcomed. She should remember that when the draft Energy Bill was published and we first started to discuss electricity market reform, there were no proposals to set a power sector decarbonisation target—not from the Opposition or from any other party in this House—but I, as Secretary of State, argued in the Government to set such a target, and that is what we have done.

We have very little economic growth in this country at the moment, but last year the CBI estimated that one third of the growth that there is comes from green business. To keep growing, green businesses say they need certainty about Government policy and they want a target in law to decarbonise the power sector by 2030. Why are the Government refusing to listen?

I am afraid it is the Opposition who are refusing to listen. They should look at the Energy Bill, in which we have legislated for the power to set a decarbonisation target—the first country in the world to do so.

On Tuesday, the Government said they opposed the 2030 decarbonisation target, in part on the ground that it would increase bills. If that were so, one would expect Fuel Poverty Action to agree with the Government, but it does not. Instead, it said:

“in failing to set a target for clean energy, the Government has yet again let down hard-up UK households.”

Will the Secretary of State explain his position in the light of that statement and say whether it would also apply to his long-grass target?

I am afraid the hon. Lady has not read the Bill; she needs to go back and do some more research. The difference in the debate has been about when the target is set, not if a target is set. The new clause tabled by my hon. Friend the Member for South Suffolk (Mr Yeo) dealt with whether it should be set in 2014; the Government have legislated to give us the power to set it in 2016, 14 years before it needs to be met. That is an ambitious position and we are yet again leading the world.

On Tuesday, most Liberal Democrat MPs tore up their own party policy to join the anti-green Tories in voting down a carbon target, which would have provided the certainty needed for Siemens finally to commit to coming to Hull. Would the Government have shown greater urgency if it was about jobs in Kingston upon Thames, rather than Kingston upon Hull?

I worry about all the Kingstons in the United Kingdom and as Secretary of State for Energy and Climate Change, I represent all of them. I am working extremely hard to make sure we get investment in the energy sector in this country and we are working with Siemens. The hon. Lady may be interested to know that, in fact, Siemens did not sign the most recent letter from a number of companies about this issue. In our discussions with Siemens, the issues that have come up are contracts for difference, strike prices, ports and infrastructure, and we are working with the company. The hon. Lady ought to get behind us and support us.

One of the key ways the Government can decarbonise power generation is by increasing investment in the nuclear sector. URENCO has a base in Capenhurst in my constituency. In April, the Government announced that they were to sell their one third share in the company, and in May the Dutch Government announced that they would sell their one third share. Will my right hon. Friend update the House on the progress of the sale?

We will give a full update in due course, but URENCO is owned by three countries—Germany, the Netherlands and the UK—and we are working closely with our partners to take the sale forward.

The Secretary of State’s answer to my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) was not satisfactory. How does he account for the dramatic decline in levels of private sector investment in the renewables sector?

Since this Government came to power, there has been a very big increase in investment in renewables. It is true that in the past few months the investment has not continued at the rate that we have seen. Why is that? Because people are waiting for the draft strike prices for contracts for difference for renewables, which we will publish next month. We are making real progress on our electricity market reform, and I am delighted to remind the House that on Tuesday this House voted for the Energy Bill on Third Reading by 396 votes to 8. That shows that we have cross-party support for our reforms and we are taking them forward.

Mid-Wales Connection Project

5. What assessment he has made of the level of support for onshore wind in those areas affected by the mid-Wales connection project. (158079)

Financial support for onshore wind from 2013 to 2017 was reduced by 10% from 1 April 2013. I hope my hon. Friend will welcome this morning’s announcement that local people will now have more control over wind farm developments in their area. They will be consulted earlier and they will have more say against turbines that are poorly sited or inadequately justified.

Since power to decide large onshore wind farms—those over 50 MW—is not devolved to the Welsh Government, will my right hon. Friend reassure me that the changes to planning policy that will be announced this morning will apply to the wind farms that the mid-Wales connection is being built to accommodate?

I am sure my hon. Friend will understand that I cannot comment on any specific wind farm proposal that is subject to the local planning authority and potentially to the Planning Inspectorate and Ministers, but as he will shortly hear in more detail from the unstarred question which I think you have allowed, Mr Speaker, the planning guidance is to be clarified to ensure that the visual impact of turbines, the cumulative impact of turbines and local factors are taken more clearly into account before consent is given.

I welcome local authorities being allowed to make their own decisions on the merits of wind turbine applications. Does the Minister agree that setting excessive minimum separation distances, as proposed in a private Member’s Bill in the House of Lords last year, or more recently by Wiltshire council, only serves to deny local communities the chance to have their say?

I am not persuaded that minimum distances are the answer, because it is important to take into account the factors that apply to every specific application and these things should be judged locally and individually on a case-by-case basis. However, in the clearer planning guidance that is being issued today it is the visual impact as much as the siting of the turbines that will now be taken more fully into account.

Green Investment

The coalition is committed to growing the green economy. An unprecedented £29 billion of new investment has been announced in renewable energy alone since 2010. We are driving further green investment through the Energy Bill, the green deal and the energy company obligation, the green investment bank, our carbon capture and storage competition, the reformed feed-in tariff, the renewable heat incentive, and our support for low-carbon research and innovation.

I congratulate my right hon. Friend on his article in The Daily Telegraph today showing that we are working closely with Sweden on these matters. What assessment has he made of the proposed EU anti-dumping tariffs on the Chinese solar PVs?

My hon. Friend is right. We are very concerned by the impact of EU tariffs on the UK solar industry. In the past three years we have added about 2.5 GW of solar here in the UK. We are making great progress but that could be jeopardised if those tariffs go ahead. I have personally been to Brussels with a number of key stakeholders from the UK solar industry to lobby the Commission, and we will continue to fight on for open borders and for the interests of the UK renewables industry.

Will the Minister explain why the UK has fallen to seventh in the world for investment in clean energy since the Government came to power?

There are a number of surveys, but the Ernst and Young survey shows that the UK is now the fifth most attractive place for renewables investment and deployment, up one place on last year.

The announcement by the Scottish Government of the relaunch of the marine renewables commercialisation fund, while welcome, has, as my right hon. Friend knows, created an imbalance between that and Wave Hub in west Cornwall. What can the Government do to ensure that the Scottish Government and this Government work in partnership on marine renewables?

As my hon. Friend knows, I am a keen champion of UK-wide marine energy. Under this coalition, we have opened a marine energy park in the south-west, and also in the waters off the north of Scotland. It is vital that we develop the marine resource right the way around the British Isles. However, I take on board the point raised by my hon. Friend, who is a big champion of marine energy in the south-west, and I will be happy to meet him to discuss it further.

Why does research by Bloomberg New Energy Finance show that investment in renewables has more than halved since this Government came to power?

Actually, as I said, an unprecedented sum of over £29 billion has been invested in renewables since the coalition came to power. As my right hon. Friend the Secretary of State said, there has been a slight tailing off in recent months, but that is to be expected, just as we expect a real acceleration once the strike price is announced and the Energy Bill is enacted.

Thank you, Mr Speaker.

I want to pursue further the EU’s imposition of tariffs. Perhaps the Minister could explain how on earth this will do anything to make it easier for people, if they wish, to install solar panels, and how on earth it will do anything to make it cheaper for those struggling to pay their energy bills.

My hon. Friend and I are absolutely on the same page on this matter. That is why I am fighting this EU proposal very hard. It is not just me; 18 other member states take a similar view to us. We are determined to continue to push the EU Commission to come to a sensible agreement with China and to make sure that the EU stands for free trade and open borders.

One significant form of low-carbon green investment that the Secretary of State spoke about during his speech to the Met Office on Monday is carbon capture and storage. His predecessor told the House in October 2011, when Scottish Power pulled out of the Longannet project, that he guaranteed that there would be no Treasury backsliding on the capital funds for CCS demonstrator projects in the competition. Will the Minister confirm whether that remains the case—yes or no—and whether the £1 billion is still available?

I am grateful for that answer, and I am sure that those in the industry who will be slightly disconcerted by the tenor of some of the remarks by the Minister of State, Department for Business, Innovation and Skills, the right hon. Member for Sevenoaks (Michael Fallon), during the passage of the Energy Bill will be gratified as well. However, may I press the Minister a little further? Given that the Cabinet Office project assessment review that I obtained last year said that in the current comprehensive spending review only £200 million was available, will the remainder of the £1 billion be available for the next CSR period? Can he confirm that whatever else he has given up in his less grand bargain with the Treasury on DECC’s budget, that money is safeguarded for CCS in the next CSR period?

I am very happy to scotch the hon. Gentleman’s baseless scaremongering and political point-scoring. The fact of the matter is that we are going forward with the CCS programme, and it is going to be successful, unlike Labour’s failed attempts at CCS. We have two preferred bidders in place, and it is backed by £1 billion, putting the UK at the front of the global race for carbon capture and storage.

Fuel Poverty

Recently published statistics show a modest fall in fuel poverty in 2011 compared with 2010, from 4.75 million UK households to 4.5 million UK households. This is welcome, but we are determined to do more. Our comprehensive policy package includes targeted energy efficiency measures under the green deal and the energy company obligation, direct bill rebates under the warm home discount and, of course, measures through the Energy Bill to back Ofgem’s proposals to simplify the market.

Under the previous Labour Government, the number of people in fuel poverty fell by 1.75 million. In the past two years, the number of households in fuel poverty has gone up from one in five to one in four. When next year’s figures come out, will the number of people in fuel poverty be higher or lower than when Labour left office?

The hon. Lady will know that during the previous Parliament, when Labour was in office, fuel poverty grew in every single year and that, according to the latest figures, it has now gone down. In many ways this is a rather odd debate. The Government commissioned Professor Hills to review how we measure fuel poverty and he has come up with proposals that have gained wide-scale acceptance. We have consulted on them and will respond shortly to that consultation. We believe that the old measurements of fuel poverty, which are still in use, need radical reform so that we can better target fuel poverty policy.

The problem with Government measures such as putting the consumer on to the cheapest tariff—if that ever happens—is that they will not make much difference if the tariff prices themselves and energy prices are high. The main beneficiaries of the green deal are not people on low incomes, but people who will be able to take up the arrangements. What is the Secretary of State doing to help people on low incomes who face high energy bills now, particularly given the high fuel prices over the past few months?

We have a whole range of measures. For a start, the warm home discount helps more than 2 million low-income people, including 1 million of the poorest pensioners, by taking £130 off their bill directly. Schemes such as collective switching mean that we are helping people club together to exercise power in the market to get better rates. The simplification of tariffs proposed by Ofgem will mean greater competition and choice for people. We have a whole range of measures. On energy efficiency, the energy company obligation, through the affordable warmth and carbon saving communities schemes, is helping people in fuel poverty.

The Secretary of State clearly thinks he is doing a great job on fuel poverty. In which case, why does his own Department’s public attitudes survey show that concern about energy bills has risen from 49% last year to 59% this year? Is not this another example of a Government who are out of touch with ordinary people?

I am extremely concerned by energy bills. We need to do as much as we possibly can and some of our new policies will help people. I say to the Labour party that it is this coalition Government who are reforming tariffs to take away the confusion and complexity that the previous Government failed to tackle, who are looking into collective switching to help people get a better deal from energy companies, and who are getting more competition in our energy market. We are taking a whole range of measures to help consumers.

Despite the initiatives that the Secretary of State has referred to, in the real world bills are going up and the energy companies are making massive profits. Thousands of my constituents are having difficulties paying their bills. When did the Secretary of State last meet the energy companies, and did he raise with them the amount of profit they are making and what was their answer?

I think I met the big six together in one group last month. I will have to clarify the date on which we spoke. We discussed a number of issues. I made it clear to them that competition and consumer service are critical. One of the best ways to make sure that companies make reasonable profits is through healthy competition.

Energy Efficiency

This Government’s November energy efficiency strategy clearly sets out the importance of reducing our energy demand and how the UK has an opportunity to lead the world in improving its energy efficiency. Game-changing initiatives such as the green deal, electricity demand reduction and the roll-out of smart meters are central to realising this opportunity.

Does my right hon. Friend agree that helping to improve home insulation is vital when helping to take people out of fuel poverty? What is this Government’s energy company obligation doing to help vulnerable and lower-income families in that vital task?

My hon. Friend is absolutely right. Energy prices have gone up massively on global markets and we as a Government need to cushion people from those rising prices by helping them with energy efficiency, and through the green deal and ECO we are doing just that. The affordable warmth component of ECO is already making a major difference for people in fuel poverty and helping to tackle it.

I welcome the Secretary of State’s saying that he wants to support people, but there has been a 97% plummet in the number of cavity wall insulation installations, one in four insulation workers has lost their job since December and, according to industry reports, just three people are paying back a green deal loan on their electricity bill. When is he going to make the green deal a good deal, so that the ambition that we all share is achieved?

It is already a good deal. I understand the issue in the cavity wall insulation market, but the hon. Lady will understand that there are very few cavity walls left to fill. The real issue in the building fabric of the nation is solid walls. There are 7 million solid walls that are yet to be treated for energy efficiency. The last Government did almost nothing to tackle that. The green deal and ECO will do something about it. That is where the biggest wins are available and we are proud of what we are doing.

Green Deal

The coalition is committed to helping consumers up and down the UK reduce their energy bills by driving energy efficiency. The green deal went live on time, as planned, on Monday 28 January. By the end of April, more than 18,000 assessments had been carried out. Later this month, we will publish data on the number of green deal plans and a breakdown of measures installed through the green deal and ECO.

It is encouraging to hear of so many assessments, but how many providers does the Minister anticipate will be offering plans by the end of the year?

My hon. Friend is right that the number of companies that are able to offer finance is key. I am extremely encouraged that four companies are already writing plans. The Green Deal Finance Company anticipates that another eight companies will start this month and that a further 20 will begin to write plans by the end of July. We think that about 50-plus companies will offer finance by the end of the year. Ultimately, when to start writing plans is a commercial decision for each company because the green deal is primarily a private sector market that is being created by this Government.

Shale Gas

We have strengthened the regulatory framework to protect the environment and to ensure that hydraulic fracturing is done properly and safely. We want to encourage shale exploration. That is why we have announced fiscal incentives for developers and why we are working on a package of community benefits, such as discounts on bills for residents in drilling areas.

Given today’s announcement about community benefits for onshore wind, will my right hon. Friend elaborate on what community benefits the communities that host shale gas reserves may expect if such exploration goes ahead?

We are discussing that matter with the industry and will consult on more specific proposals shortly. It is important that residents who suffer disruption in areas where there is drilling see benefits from it, either for their local community through grants or expenditure, or, better still, through discounts on their bills, which could be significant.

Home Energy Efficiency (Milton Keynes)

I was delighted to visit Milton Keynes in July last year, when I was pleased to launch new guidance for local authorities under the Home Energy Conservation Act 1995 and to visit, with my hon. Friend, the Lakes estate retrofit project, which is improving homes and cutting energy bills for his constituents.

As part of the pioneer places project in Milton Keynes, the National Energy Foundation has engaged with 30 local traders to promote the benefits of becoming green deal installers. What plans does my right hon. Friend have to roll out that scheme nationally?

My hon. Friend has done a huge amount in the Milton Keynes area to work with small and medium-sized enterprises and traders in the supply chain. Nationally, we have provided more than £2 million to support the training of 1,000 go-early green deal assessors and 1,000 advisers as part of our support for the developing market. Since last autumn, DECC has organised a series of 12 roadshows, which have reached more than 1,600 companies across the country. My team has worked most recently with Energy UK to deliver a further regional roadshow programme. It is early days for the green deal, but the prospects are exciting.

Will the Minister agree to my hon. Friend’s request to go to Milton Keynes, because he could then pop down the road to Wellingborough to meet councillors and constituents who are worried about applications for wind farms that, although not in the constituency, would affect them? That would be a great opportunity to explain our new policy.

I would be delighted to return to Milton Keynes, and to visit the constituency of my hon. Friend the Member for Wellingborough (Mr Bone), particularly if there is an opportunity to compare notes with Mrs Bone.

Off Grid Gas

18. With reference to the findings of the all-party parliamentary group on off-gas grid, what plans he has to help residents living off the gas grid. (158095)

I am grateful to the all-party group on off-gas grid for its informative report. I chaired a round table in May with colleagues from that group, consumer groups, local government and industry, as a result of which a better consumer code of practice is being circulated by the Federation of Petroleum Suppliers. Fuel Poverty Action is developing recommendations on information sharing and vulnerable customers, and Ofgem is considering connecting electricity and gas priority service registers to other markets, including heating oil.

I thank the Minister for that answer and welcome the developments that have been made as the all-party group continues its good work. Will the Minister review the progress that has been made and meet the group again so that further representations can be made and we keep the providers of that type of power up to speed?

I reassure my hon. Friend that the round table I was privileged to chair was not a one-off event and I shall be organising a further meeting on 11 September to chase up progress. I am happy to meet specifically the all-party group, as well as continuing to chair the round table.

Topical Questions

Since my Department’s last question time, the remaining stages of the Energy Bill have been completed and approved by this House by 396 votes to 8. The Bill has been introduced into the other place as we make further progress to build the world’s first ever low-carbon electricity market.

For consumers, I published the Government’s response to the discussion document, “Ensuring a better deal for energy consumers”, which confirmed the Government’s backing for Ofgem’s market reforms that are designed to improve competition in retail markets and help consumers. Today, along with the Department for Communities and Local Government, we have published the Government’s decisions on onshore wind to give communities a greater say, setting out an industry-proposed fivefold increase in benefits for communities in England, and keeping financial support for onshore wind at the rate of 0.9 renewables obligation certificates.

Middlesbrough South and East Cleveland has more than 7,000 households living in fuel poverty, and since this Government came to power the energy bill of the average family has leapt by more than £300 a year. Will the Minister please tell the House why the Government have halved support for people in fuel poverty while giving millionaires a tax break?

We have not halved fuel support and will increase it over the lifetime of the spending review. We are changing and reforming it to ensure that it is more effective, which the hon. Gentleman ought to support.

T2. One way we can reduce the cost of heating and carbon emissions is through the use of biomass boilers, which can save households hundreds of pounds each year. The Government have a target of installing 1 million biomass boilers in the UK by 2030, but some are concerned that the target might not be met. Will the Minister outline what steps are being taken to achieve the target, and meet businesses such as Baxi UK in my constituency to discuss the issue? (158098)

I know that my hon. Friend does a huge amount for businesses in his constituency, and I would be happy to meet him, Baxi UK, and representatives of the industry in my Department. The coalition Government are committed to delivering not just cheaper bills but cleaner energy, and biomass boilers are part of that strategy. The good news is that we have recently announced that renewable heat payment vouchers for biomass will increase to £2,000 until March 2014, and later this summer we will provide details for the scheme that we will be launching for domestic renewable heat initiatives next spring.

Apparently, more than 5 million homes could still benefit from cavity wall insulation, so there is still a lot of work that could be done.

The Government have claimed it is too early to set a decarbonisation target for 2030, but next month they will publish their electricity market reform delivery plan, which will determine our energy mix and its carbon intensity. In the absence of a legally binding decarbonisation target, will the Secretary of State at least confirm that his long overdue delivery plan will be in line with our legally binding carbon budgets, or will the Government be rewriting the fourth carbon budget?

No, the plan will be in line with our legally binding obligations. As I have explained to the House, before we set the decarbonisation target in 2016 we will give National Grid guidance on setting the EMR delivery plan to ensure that it is on path to meet our decarbonisation targets in the least-cost way.

T3. The Minister will be aware that I represent Thoresby colliery in my constituency, one of the most efficient and profitable pits in the country. Is he optimistic for the future of coal mining in Nottinghamshire, and does he remember my invitation to visit? (158100)

I would be delighted to visit my hon. Friend’s constituency. He will know that deep-mine coal in this country has suffered a number of setbacks this year, including the serious fire at Daw Mill colliery. I assure him that my officials continue to work with the company to do our best to ensure its continued viability. We are also in touch with the situation in Scotland to ensure that everything possible can be done to replace some of the jobs that were lost when the company there went into liquidation.

T4. On some energy issues, such as setting a date for a decarbonisation target, the Government appear to be extremely slow, but on others, such as the exploitation of shale gas, they want to rush ahead at great speed without looking at environmental and safety considerations. Will the Secretary of State commit to looking properly at those considerations before any extraction takes place? (158103)

In 2016, we will be the first country to set a decarbonisation target, so the idea that we are being slow on that is preposterous. On shale gas, we are behind other countries—she may have noticed that the US has already gone into it. We are determined to see whether this country can benefit from shale gas, but we will ensure that we protect the environment and take the public with us. That is the right way to get the benefits for the country that shale gas might well offer.

T6. I congratulate my right hon. Friend on today’s announcement that local opinion will no longer be trumped at the planning stage by national policy. However, everyone in my constituency wants to know whether that applies to the six large wind farm applications, over which planning power is not devolved, and which are currently being heard at the UK’s largest ever public inquiry, which started yesterday. Everybody in my constituency is desperate to know whether those applications are subject to the new policy. (158105)

My hon. Friend will know that the public inquiry has started, and that it would be inappropriate for a Minister to comment on it. I am sorry, but I cannot give him the answer he looks for.

T5. Will the Secretary of State explain why, at the same time as energy bills are soaring, research from Energy Bill Revolution and the Association for the Conservation of Energy shows that help for people most in need is falling? (158104)

I have not seen the research to which the hon. Lady refers. Given that we have introduced the warm home discount, which targets some of the poorest households in our country, taking £130 directly off their bills, I would be surprised by such findings. I reassure her and the House that the Government are not complacent on the challenge of fuel poverty. We know we need to do as much as possible, which is why we commissioned Professor Hills, why we consulted on many of his proposals, and why we will respond. We will shortly produce a framework on fuel poverty and produce a strategy by the end of the year. The Government believe that that should be a high priority.

T7. When will the British Geological Survey review of shale gas reserves be published? Given that IGas recently found that there are 20 times the previous estimates of reserves, does the Minister agree that shale represents a major strategic advantage for Britain, in meeting energy demand and decarbonisation? (158106)

I can confirm to my hon. Friend that the BGS report will be published before the summer recess. There have been a number of optimistic estimates of the amount of shale in the UK. Shale clearly has enormous potential. It would therefore be irresponsible of us not to encourage exploration to see exactly what is down there.

The Teesside Low Carbon consortium, comprising some of the country’s top companies and experts, was rightly disappointed when its innovative project for capturing and storing the carbon created by our energy intensive industries was rejected by the Government. We know that the project is on the reserve list, but is there any real hope that the project, which would take huge amounts of carbon out of the atmosphere, and which has the potential to drive thousands of jobs in an area where unemployment is as high as 10%, will receive financial and other support from the Government to make it a reality?

Let me be clear: this project was not rejected but placed on the reserve list. We are working with our two preferred bidders to take forward the carbon capture and storage competition. Should one of the two bidders drop out, we will of course look again at the situation.

Following on from the question asked by my hon. Friend the Member for Sherwood (Mr Spencer), Kellingley colliery in my constituency is a profitable, high-performing deep coal mine with 700 highly skilled employees. Will the Minister update the House on what is being done to ensure its viability?

I think my hon. Friend knows that we have been working flat out to help the company to restructure since the fire at Daw Mill. That has involved intensive work with a number of other Government bodies. I understand how frustrating it is for him and, in particular, for those who work in the colliery not to have had an announcement yet, but I am hopeful that we will see progress in the next few days.

Further to that question, the Minister will know that UK Coal has applied for a loan from the Government that would be paid back when the insurance comes through from the Daw Mill fire. What is happening with that loan?

The position is that insurance payments are now coming through to the company, so the financial situation is not quite as the hon. Gentleman describes it. I want to assure him that the Government are doing everything they possibly can to safeguard the financial future of the two collieries, and to assist the company in necessary restructuring following the disastrous fire at Daw Mill earlier this year.

Many village halls, such as the one in East Brent in my patch, have applied for Big Lottery awards for all funding to install PV solar panels and use feed-in tariffs as an invaluable source of income to make repayments on loans to complete their projects. It is a feature of the lottery that it is funded not by Government but by individuals, and that that grant funding is made completely independent of government, as is stated on its website and in its literature. Ofgem seems to have decided in February 2013 that lottery funding is—

Order. It is my ambition in this Parliament to educate the hon. Lady that the second sentence should usually end with a question mark. That is what we want.

It is, Sir. I must explain myself. Will the Secretary of State investigate Ofgem’s administration of the scheme and the lack of information provided to everybody involved, so that it reverses its decision to categorise lottery money as state aid?

My hon. Friend is a doughty campaigner for her constituents in villages, helping them with community halls and so on. I am aware of this issue—it is not just grants from the lottery, but grants from elsewhere in government that prevent installation of micro-technology receiving feed-in tariffs under the Ofgem scheme. This matter has been raised by a number of hon. Members and I hope we are able to look at it in due course.

The Secretary of State does not have to compete with Back Benchers. There is no obligation for the answer to be as long as the question.

Earlier, the Minister mentioned that the Government’s policies would result in energy bills being about 7% lower, but is that not correct only if people go out and buy new energy-efficient TVs, washing machines, dishwashers and combi gas boilers, and that if people do not their bills will actually be higher under this Government?

I am afraid that the hon. Gentleman is wrong. The methodology of the bills and prices report includes examining how often average households replace these types of goods—it is statistically robust.

I thank the Government for listening on wind. Communities across north Yorkshire will be delighted by this decision. The Minister of State, my right hon. Friend the Member for Sevenoaks (Michael Fallon), is already popular in north Yorkshire, but I am sure that they would join me in wanting to give him a collective hug to thank him for this decision.

I am married to a girl from Yorkshire, but I think that a further hug would probably not be appropriate.

It is important that communities understand that they will now have more say against developments that are inappropriate and not properly justified. Too many communities have felt under siege from wholly inappropriate applications, and this measure will now bring them much-needed and long-awaited relief.

The Minister referred to the coal industry in Scotland. I am sure he knows of the devastation in my constituency and in that of my neighbour, my hon. Friend the Member for Ayr, Carrick and Cumnock (Sandra Osborne). What recent discussions have taken place with the Scottish Government to address the serious environmental consequences of restoration work not going ahead?

We are in touch with the Scottish Government. I have ensured that an official from my Department attends meetings of the taskforce set up following the collapse of the Scottish company. We will learn lessons from what has happened in Scotland, and if the British Government can help, of course we will.

Will my right hon. Friend explain what role he sees the energy efficiency strategy playing in reducing demand for energy?

My hon. Friend will know that earlier this year the Prime Minister launched our first-ever national energy efficiency mission. We are determined always to pursue the cheapest option, including where the cheapest option is saving energy rather than building new plant, but we will do that in a way that is good for consumers and gives us lower bills as well as cleaner energy.

Order. If we are to accommodate the several remaining colleagues, very short answers will be required.

Will the Secretary of State have another go at answering my earlier question? He said he met the energy companies last month. Let me put the question this way: when he met them, did he raise any concerns about the level of profits they were making, and, if so, what did they say?

I do not think that profits were part of a specific conversation. This issue is about the whole market: how we ensure more competition and more investment and how we protect consumers from rising global prices by ensuring that they help us deal with energy efficiency.

In order to save money and improve Government efficiency, would the excellent Secretary of State agree to close his Department and transfer its responsibilities to the Department for Business, Innovation and Skills? He, then, could become the Business Secretary, freeing up the Secretary of State for Business, Innovation and Skills, the right hon. Member for Twickenham (Vince Cable), to concentrate on his campaign to become the next leader of the Liberal Democrats. It would be a win, win situation for everyone.

You will know, Mr Speaker, that the Liberal Democrats always listen to the hon. Gentleman’s advice, because it is always meant as a helpful contribution. I can tell him, however, that my right hon. Friend the Member for Sevenoaks (Michael Fallon) is a fantastic Minister of State and does a brilliant job not only in my Department, but in the Department for Business, Innovation and Skills, so we are already very well connected.

The Secretary of State told me earlier that he was concerned about all Kingstons in this country. On that basis, would he agree to meet me and a delegation from Kingston upon Hull to discuss what more the coalition Government can do to support Siemens coming to Hull?

I welcome the Minister’s support for biomass boilers, but the renewable heat incentive was announced in October 2010. Why is it not possible to open up the domestic scheme for payment before spring 2014?

It has been much more challenging than we anticipated, not least because when we entered government we found that the previous Government had done absolutely no work on this whatsoever. This is the first renewable heat scheme of its type in the world, and heat is much more difficult to quantify and value than exporting electricity, but it is good news. We prioritised industrial heat and are now moving on to domestic heat, and I am looking forward to the scheme’s launch this spring.

The Minister claims that the energy company obligation will help people in fuel poverty, but is it not true that nearly 60% of the funding will go to households that can already afford to pay, not to those people in fuel poverty?

It is anticipated that more than £500 million of the ECO funding will go directly to the most vulnerable and those who need it most, but the balance of the energy company obligation is intended to support roll-outs street by street. It was the specific nature of previous Government schemes under Labour that made them so bureaucratic and ineffective. Our view is that we ultimately need to focus on properties, not just the individuals who live in them.

The co-firing of biomass at power stations such as Drax brings enormous opportunities to growers and farmers in Thirsk and Malton, but will the Minister or Secretary of State assure the House that unfair subsidies to imported wood chip are not undermining our home-grown produce?

The hon. Lady will know that our schemes apply to all companies, wherever they are from. We need to ensure that we invest in renewables such as biomass, but in a way that meets our sustainability criteria and creates a proper, fair market.