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Topical Questions

Volume 576: debated on Thursday 27 February 2014

Since Energy questions in January we have published Britain’s first ever community energy strategy, which is widely welcomed by the sector. This week we published a review by Sir Ian Wood into our oil industry. I have accepted Sir Ian’s recommendations, and we intend to fast-track his proposals. I am grateful to Sir Ian and his team for their work, which we believe is a game-changer in the management of our offshore oil and gas assets. Finally, we announced a second carbon capture and storage project this week—the world’s first ever commercial-scale gas CCS project—and CCS will play a key part in our decarbonisation strategy.

The CCS project is indeed most welcome; it is a pity it did not get here some years ago. The Secretary of State mentioned the fuel poverty strategy currently under preparation. I appreciate that the winter fuel allowance is for the Department for Work and Pensions, but given the impact it could have on pensioners in rural areas will he press for action to be taken to allow the early payment of the winter fuel allowance?

I say to the hon. Gentleman what I said to the previous questioner who raised this. We are looking at all these matters and we are working across Government—with the Department for Work and Pensions, the Department for Communities and Local Government, the Treasury and the Department of Health—on our fuel strategy, because it touches on all areas of government: benefits, health services, flu jabs and a whole range of issues that need to be looked at. I am not going to prejudge the publication of that strategy.

T3. The Secretary of State stated in the Yorkshire Post on 14 February that he expects Eggborough power station to remain open, even if it does not obtain his support for converting from coal to biomass. Will he explain his Department’s detailed analysis, specific to Eggborough, that leads to that conclusion? I appreciate he might not be able to do that in the time allowed here, so will he—not just his officials—meet me and representatives from Eggborough to discuss that detailed analysis as a matter of urgency? (902716)

My hon. Friend is a consistent champion of Eggborough and its proposed conversion. He will know that I have already met him and representatives from the company to discuss the proposal for converting to biomass. We received a large number of investment projects under the intermediate regime. It was not possible, because of a limited budget, to support them all through the taxpayer, but he will know that Eggborough has a number of other options and routes to consider.

I am very pleased that the matter of Eggborough has been raised. The loss of 850 jobs at Eggborough, with thousands more in the supply chain, is very worrying. What steps is the Minister taking to ensure that his Government’s policies create jobs, not cost jobs, and safeguard, rather than threaten, our energy security?

The jobs have not yet been lost at Eggborough, which is still producing power. A large number of investment projects came forward under our intermediate regimes involving hundreds of other jobs. It was not possible, within a limited budget, to accommodate every single investment project. Eggborough has been given its provisional ranking and it has other alternatives, such as applying for a contract for difference under the enduring regime.

T5. The Minister will recall visiting my constituency a couple of years ago to look at a green deal project to make houses on the Lakes estate more energy efficient. Will he update me on how many families were able to benefit from the scheme? (902718)

I cannot give my hon. Friend the figure off the top of my head, but what I saw in his constituency, and what he has championed, is at the forefront of what we want to see: energy efficiency measures that genuinely improve not just the fabric of the building but the community, living standards and the comfort of people there—as well as driving down energy bills.

T2. The Minister of State previously showed faux concern for communities that are off gas grid. Is not the implication of the Government’s energy policy that many, many more communities will be without gas supply if gas supplies are switched off when the energy industry is electrified? When will he tell those communities that they will no longer be able to have gas? (902715)

I do not recognise the hon. Gentleman’s analysis. The idea that the Department has taken the decision to mandate the end of the gas network is simply not true.

T6. Later this morning I will take part in a meeting to assess the progress and way forward on implementation of carbon capture and storage. Alstom, from my constituency, will be taking part. Will my right hon. Friend please update the House on how the UK is leading the world in carbon capture and storage technologies? (902719)

Yes. The UK is extremely well placed to take forward critical low carbon technology. We have all the experience from the oil and gas offshore industry in the North sea. The North sea has some of the largest reserves of carbon dioxide in Europe, and our universities and companies have some of the greatest engineers and scientists who are able to take forward this incredibly low carbon opportunity for the world.

T4. The poorest consumers are among those who use prepayment meters. What steps are the Government taking to ensure that they are not charged more than other customers? (902717)

We take this issue very seriously. We want to ensure that every payment method reflects the cost fairly, and that there is no gaming between the different methods. The issue will form part of our competition test, and we are also working on it closely with Ofgem.

T7. CNG is a north Yorkshire success story, serving gas customers, small businesses and small corporations, but it is anxious about entering the domestic market because of the burden of regulation, compliance costs and risk costs. Can we do any more to encourage companies such as CNG to enter the domestic gas market? (902720)

I am interested to hear about the company in my hon. Friend’s constituency. If he writes to me giving the details, we shall be able to look into the issue. He may also wish to send those details to the independent authorities which are conducting the competition assessment. We have deregulated the energy markets to reduce barriers to entry to the market, but we want to do more.

Will the Secretary of State join me in welcoming the launch today of the fourth GLOBE international climate legislation study, which shows how many more national Governments are taking urgent action to deal with climate change? Given the importance of the climate change debate, will he return to the issue of the review of the fourth carbon budget? Will he recognise that if the United Kingdom and Europe want to continue to take a leading role in climate change negotiations, it makes no sense to have that review now?

I do welcome the publication of the climate legislation study. The United Kingdom, including many parliamentarians throughout the House, has played a leading role in encouraging other countries to enact climate change legislation, and it is encouraging to see how many have responded. I pay tribute to the Members involved, particularly the hon. Member for Brent North (Barry Gardiner).

I cannot add anything to the answer I gave earlier about the fourth carbon budget review, which is currently under way. When we published the fourth carbon budget, it was decided that a review would take place at this time, and I cannot prejudice its outcome.

We have already set up an implementation group in the Department, because Sir Ian Wood published an interim report and we were able to study it and make preparations. I asked Sir Ian to chair an interim advisory panel to help us with our work, and he has agreed to do so. We are also keen to introduce legislation during the next Session of Parliament to implement his ideas about new powers for the proposed new regulator.

As the Secretary of State will recall, I told the House back in November 2013 that the npower call centre in Thornaby was placing 500 jobs in jeopardy through its proposal to close the centre and relocate on its existing Sunderland site. We now know that more than 400 members of staff have opted for voluntary redundancy because npower’s promises of a relocation package and transport have not come to fruition. What conversations has the Secretary of State had with his colleagues in the Department for Business, Innovation and Skills with a view to mitigating the problems of the Thornaby workers?

I know that BIS considers such issues very seriously, and we discuss them a great deal across Government. We want to ensure that support is provided in the event of large-scale redundancies, whether voluntary or compulsory. I cannot say any more about the specific case that the hon. Gentleman has raised, but I will ask my officials to look into it.

Many communities in my constituency will be interested in the community energy initiative. How can they find out more in order to promote their local generating ideas?

Our Community Energy online guide is a great starter tool, opening up the world of exciting community energy projects which are increasing daily under this coalition Government.

The German Chancellor is visiting Parliament today. May I invite the Secretary of State to hold talks with her about the support that her Government give to energy-intensive industries in Germany? I am sure that that support is welcomed by those industries, but it makes it increasingly difficult for energy-intensive industries in our country, such as the steel industry, to compete.

We are already paying emission trading system compensation—some £28 million so far—to 53 companies, including eight steel companies, nine chemical companies and 28 paper companies. I discussed a carbon price floor compensation scheme with Vice-President Almunia in Brussels last week, and I hope that that too will be approved next month.

I recently met 90-year-old Norah at the Phoenix centre in Holmfirth to learn about the energy bill revolution. Does my right hon. Friend agree, however, that one of the best ways of reducing energy bills for those facing fuel poverty is to insulate their homes?

I agree completely that energy efficiency measures are one of the best ways of providing long-term sustainable support to the fuel-poor. I completely understand and appreciate the motives behind the energy bill revolution, although hypothecation itself may not always be the most effective way of managing public expenditure.

What action is the Secretary of State taking to ensure that the new fuel poverty target will address the specific needs of people affected by severe and devastating rare conditions such as muscular dystrophy and neuromuscular conditions?

I am grateful to the hon. Lady for the question, and that is one of the reasons why, in developing the fuel poverty strategy, we are working across Government. She is right to say some health conditions may require people to be at home for longer, and they may not be of pensionable age and getting the winter fuel allowance. I hope we can look at that issue during the finalisation of the fuel poverty strategy.

With Angela Merkel’s forthcoming speech to both Houses of Parliament in mind, does the Secretary of State agree that it would be very wise and sensible to incorporate energy more thoroughly into the single market, and what steps is he taking to bring that about?

I discussed these issues with the German Government in Berlin yesterday and I agree with my hon. Friend that completing the internal market, with more interconnection and work on network codes and sharing, is part of the answer to making Europe more self-sufficient in its own energy and in reducing our dependence on fluctuating wholesale costs.

I draw attention to my entry in the Register of Members’ Financial Interests—and, indeed, also in The Mail on Sunday. The Secretary of State was good enough to welcome the GLOBE conference today in Washington and the fourth legislative study. Will he also welcome the forest legislators initiative that is going alongside that, which is looking into REDD-plus and the expansion of that work in Latin America and Africa in particular?

First, may I pay tribute to the hon. Gentleman for the work he does on forestry and the contribution he has made? I am not aware of the details of the legislative initiative he mentions, but it does sound very sensible. This Government have done a huge amount to support efforts to tackle deforestation in Latin America and elsewhere and I will certainly take note of what he said.

Under the current business rates arrangements, businesses have very little incentive to increase energy efficiency as investing in premises can lead to higher business rates. Did the Secretary of State see last week’s British Retail Consortium proposals for modernising business rates, suggesting a scheme whereby energy efficiency and improvements are rewarded with lower business rates, rather than penalised? Will he discuss these proposals with his colleagues in government?

I am grateful to my hon. Friend for her question. I did note those proposals and I thought they were very interesting. It would be unwise of me to prejudge the work that will be done on them in other Departments, including the Treasury, but the Minister of State, my right hon. Friend the Member for Sevenoaks (Michael Fallon), has a meeting later today to discuss the proposals with business representatives.