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Energy Company Obligation

Volume 576: debated on Thursday 27 February 2014

1. What recent assessment he has made of the effects of changes to the energy company obligation on consumers. (902723)

We will shortly be consulting on changes to the energy company obligation. We are aware of a number of ECO-funded solid wall insulation projects that are not going forward, but we have been encouraged by the large number of households that have already benefited from ECO measures, which is now estimated at nearly 450,000 properties at the end of December 2013. Moreover, thanks to the package of changes that I announced on 2 December 2013, which included the proposed ECO changes, consumers across the UK are set to see their energy bills reduced this year by an average of £50.

The Secretary of State already knows the devastating impact that his changes are having on thousands of residents in Clifton in my constituency who live in hard-to-treat homes, but what hope can he offer to the 12 local youngsters who, after completing their initial training, were due to start year-long apprenticeships in installing solid wall insulation when his change of policy put their futures and hundreds more green jobs on hold?

I am sure that the hon. Lady welcomes the many ECO measures in her constituency. The ECO measures that we announced in December prolong the programme for two more years and have a particular focus on fuel poverty, which I would hope that she welcomes. We will announce quite soon our proposals on incentives for people who want to invest in green deal measures, through which I am sure she will see real benefits for solid wall.

I welcome the news that the energy company obligation scheme will offer targeted support to low-income households until at least March 2017. Does my right hon. Friend agree that it is often the poorest families who live in the worst insulated and hardest-to-heat homes, and that these targeted measures have the potential greatly to reduce energy costs in such difficult-to-reach houses?

My hon. Friend is absolutely right. As a result of our changes, we believe that more ECO measures will help more households. The fact that we have managed to ensure that the affordable warmth and carbon-saving community obligation aspects of the ECO will be extended at the existing rate for two more years is extremely good news for our efforts on fuel poverty.

Last month, in answer to a question from me, the Minister of State, Department of Energy and Climate Change, the right hon. Member for Bexhill and Battle (Gregory Barker), said that he would speak to the energy companies about the fact that under the affordable warmth aspect of ECO, as run by them, off-grid gas boilers are not available. Has any progress been made on that, and will the Secretary of State take action to end that discrimination?

We have listened to several representations on that and other areas. We will shortly publish the consultation document on the ECO, to which the hon. Gentleman might want to respond formally, as well as our fuel poverty strategy, which will cover some of the issues that he raises.

Order. He does not look like her and she does not look like him; I apologise to the hon. Gentleman. More specifically, I apologise to the hon. Lady.

This time last year, work under the affordable warmth component of the ECO—the element that helps low-income households—was trading on the brokerage at between 25p and 30p in the pound. Today it is trading at just 6p, which means that a maximum of £840 is available for each job, whereas last year £3,500 would have been available. Given that the Government’s figures on the boiler scrappage scheme show that 96% of boiler replacements cost more than £1,000, what assurances can the Secretary of State give that such work is being done legitimately, safely and responsibly, or even at all?

It is certainly being done in great numbers, and we can contrast the situation with that under the Warm Front scheme that the previous Government introduced. In 2010-11, about 80,000 households received help under that scheme at a cost of £366 million, but in the first year of affordable warmth, 130,000 households benefited at a cost of £350 million.

The hon. Lady—the hon. Gentleman; I am making the same mistake as you, Mr Speaker, so I do not know what it is about the hon. Gentleman today. However, I am surprised that he complains about costs coming down, because I would have thought that he would welcome that. He knows that there is regulation to ensure that standards are met.