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Community Energy Sector

Volume 723: debated on Tuesday 29 November 2022

Ofgem supports community energy projects and welcomes applications from the sector to the industry voluntary redress scheme. We encourage community energy groups to work with their local authority to support the development of community energy projects through UK-wide growth funding schemes.

Will my right hon. Friend support measures to enable community energy schemes to sell their clean power directly to local customers, as contained in last Session’s Local Electricity Bill, and look at including them in the Energy Bill?

Although I am sympathetic to the outcome desired by proponents of, for instance, last Session’s Local Electricity Bill, I am concerned that mandating suppliers to offer local tariffs may be disproportionate and have unintended consequences. But I am delighted to tell my hon. Friend, who I recognise is a great champion in this area, that as part of a wider review of market mechanisms we are considering retail market reforms and responses to the electricity market consultation.

While the Government seem particularly confused about their position on onshore wind—the most tried and tested and easiest to roll out of all renewables—their focus on community energy is even worse. The creation of strong, well informed, capable communities able to take advantage of their renewable energy resources and create community benefits is embraced by the Welsh Labour Government. Why do the Conservative Government not do the same?

I thank the hon. Lady for her typically partisan contribution. [Interruption.] She is always consistent, and her Front-Bench colleagues rightly point out that I have some things in common with her. The rural community energy fund has provided £8.8 million in development grants for 208 projects focusing on a variety of technologies, which I am pleased to say include solar, wind, low-carbon heating and electric vehicle charging. The Government will be delighted to work with the devolved Administrations and others to drive forward our pathway to net zero.

Referring to the Minister’s response to my hon. Friend the Member for North Devon (Selaine Saxby), energy market reform is critical to ensure the growth of the community energy sector and to splitting out the wholesale gas price from the electricity price and other things. Will the Minister update the House on the Government’s current thinking on wholesale market reform?

Community energy schemes such as Hoy Energy Ltd in Orkney perform a really important role in the community by reinvesting their profits in local schemes and projects. Will the Minister assure me that when it comes to devising regulations under section 16 of the Energy Prices Act 2022, there will be exemptions for such companies to ensure that they can continue to put the profits that they generate back into the community?

The provisions in the Energy Prices Act have been superseded by the announcements made by the Chancellor in the autumn statement, and therefore I do not think that they strictly apply any longer, as the right hon. Gentleman has suggested.

Does the Minister accept that the inability of local energy providers to trade within their local community remains one of the biggest obstacles to the development of community energy overall? If he is not willing to take on board the provisions of the community energy Bill that is presently being promoted by community energy supporters, does he have any other ideas as to how that problem could be overcome in the context of the Energy Bill, which I am delighted to see has resumed its parliamentary process today?

I thank the hon. Gentleman for his question, and for his close interest in this field and knowledge of it. I look forward to sharing with the House further thoughts on how we can deliver precisely that more dynamic situation going forward. As he rightly says, there are provisions in the Energy Bill, which I am delighted to announce is resuming its passage through Parliament.