1. What steps his Department plans to take to reduce the overall subsidy to UK energy sources. (906708)
The Government recognise the hon. Gentlemen’s point regarding the impact on taxpayers and consumers of Government support for renewable and low-carbon energy. However, Government policies are also aimed at reducing bills. Without Government policies, particularly on energy efficiency, bills would overall be on average around £90 higher this year.
Yesterday the Prime Minister confirmed that he is happy to see the levy control framework increase to £371 per year per household by 2020. At a time of falling oil prices and at a time when the shale gas revolution holds out the tantalising prospect of cheap energy, is not the Department carrying on subsidising windmills unnecessarily, and are we not making policy on the basis of outdated assumptions that need to revised?
We recognise the importance of keeping bills down for consumers, particularly when times are difficult, but this Government’s initiatives are to help reduce bills and our support for renewables is unquestionable. We feel it is essential to have some subsidy to get renewables going. I note that the hon. Gentleman is a big supporter of solar. Those costs have come down and our support has consequently come down. We expect it to reach grid parity by 2020. We are optimistic that wind farms are also beginning to come down in cost, and we have seen a 10% reduction in the support for them very recently.
Does my hon. Friend agree that linking oil prices to energy, and particularly heating bills, is nonsense given that we do not have any oil generation to speak of that generates electricity here in the UK—there is only maybe a tenuous link with heating oil? We should be focusing on driving down the cost of home-grown energy, particularly clean energy.
As always, my right hon. Friend makes an important point. Renewable electricity is essential, and I hope his Christmas tree lights burn even brighter this year, because 15% of that will indeed be from renewable energy, which is twice as much as under the last Government.
At a recent conference, a Treasury official, when asked about the levy control framework, said:
“A priority for the next Government is to review what should happen after 2021.”
He also said that he would hope to get clarity early in the next Parliament about what should happen, rather than towards the end of it, and that:
“We shouldn’t sprint towards a cliff edge.”
Is that the Minister’s position on the levy control framework, or is she sitting there doing nothing about it?
The hon. Gentleman will be aware that those decisions are largely for the next Government. However, the levy control framework is an important part of controlling our expenditure. It is a classic example of the competence under this Government, as opposed to the chaos under the last, who had no levy control framework at all.
The Prime Minister said at the Liaison Committee this week that his party would scrap subsidies for onshore wind after 2015 and he did not expect any more to be erected without subsidy, but onshore wind is one of the cheapest forms of green energy. Does the Minister not agree that an essential part of trying to reduce energy bills is having onshore wind as part of the mix?
Onshore wind has been an important part of the mix and, of course, we have more onshore wind in this country than in the rest of the world, so I think that it may be time for us to spend our scarce resources on other types of renewables to ensure the best return for taxpayers.
One of the technologies we provide support to is carbon capture and storage. Is the Minister aware that UKIP is opposed to carbon capture and storage? It has described it as “expensive, difficult and pointless”. Does she agree with me that UKIP’s policy would mean that there is no long-term future at all for any of Britain’s coal mines or coal-fired power stations?
I share the right hon. Lady’s views on this. Carbon capture and storage is indeed an important part of our energy mix and an important part of supporting all energy sources in this country.