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28 Mar 2003 : Column 584—continued
10.54 am
Mr. Tom Cox (Tooting): Like other speakers, I warmly congratulate my hon. Friend the Member for Milton Keynes, North-East (Brian White) on his luck in being able to present the Bill and on his presentation to the House this morning. I intend to be very brief, because I realise that other colleagues wish to speak in this important debate, and I shall concentrate on clause 2, which refers to domestic energy efficiency.
I listened with great interest to the speech of the hon. Member for Southend, West (Mr. Amess), as I am sure we all did, and I agree with much of what he said. All of us know that the more a home is insulated, whether in the loft, walls, windows or doors, the better it is for the person who lives in the property and for energy saving. At present, there are two early-day motions on the Order Paper dealing with this matter to which I want to refer. Early-day motion 79, which is headed "Reduction of VAT on Energy Saving Materials", calls for a reduction in VAT on such materials to 5 per cent., although many would say that they should be zero rated. It would be interesting to hear from my hon. Friend the Minister just what the Government's view is on that motion.
I put it to the House that it is by taking action on such matters that we can build up public confidence that the Government are committed to the kind of things that my hon. Friend the Member for Milton Keynes, North-East is seeking to achieve in his Bill. Indeed, such aims
were shared in the Bill that the hon. Member for Southend, West introduced some time ago. Early-day motion 147, which is entitled "Ending Fuel Poverty", states that
- "resources for fuel poverty programmes will need to be increased by . . . 50 per cent."
This week, I received a booklet from Help the Aged—I am sure that all Members of the House will have received it—entitled "Stop pensioner poverty now". On page 8, under the title, "End the outrage of 20,000 avoidable deaths every winter", it says:
- "Despite a government initiative and some useful assistance, 'fuel poverty'—defined as the need to spend more than 10 per cent of your income on fuel to heat your home adequately—is still very common among older people, who often live in cold, damp homes. The current system of means-testing help only for those who receive benefits is not working.
We urge the Government to adopt a more humane and sensible approach. The Scottish Executive, for example, is installing insulation and central heating in all homes that do not already have it by 2006. Until that happens, many thousands of the vulnerable older citizens of this wealthy nation will die, simply because, in the twenty-first century, we cannot cope with the effects of cold weather."
Many people in all our constituencies are retired and on low incomes but have a perfect right to live in a home that has an efficient energy system. The Bill attempts to deal with that. However, such systems cost money and I would like my hon. Friend the Under-Secretary to tell us what financial assistance the Government will provide. I have already cited the early-day motion that states that current funding is inadequate.
Like other Members, I believe that the Bill deserves the House's full support. It is crucial to examine energy needs not only in the immediate but in the long-term future. I have heard the comments about the White Paper. Although I have reservations about it, it contains specific guidelines to which not only the current Government but future Administrations must make a genuine commitment.
For me, there are two key requirements to fulfilling the future energy efficiency needs of our country. First, the Government must make a genuine commitment. Secondly, they must also provide financial support. It is no good having wonderful ideas such as planning the energy needs of our country up 2050. We must make a commitment and back it up with meaningful, continuing financial provision by the Government and future Governments.
I am pleased to have made a short contribution to the debate. Again, I warmly congratulate my hon. Friend the Member for Milton Keynes, North-East on promoting the Bill. Like other hon. Members who have
spoken, I want the Bill to receive a Second Reading, go into Committee and, in the course of the year, to become part of this country's legislation.11.2 am
Dr. Alan Whitehead (Southampton, Test): Many hon. Members have described the Bill as a modest measure. I believe that it is not modest but important. Energy in the future, and especially reducing the amount of carbon dioxide, is not a project. It is not something that we simply do and subsequently leave. We must commit ourselves to it in the long term if we are to achieve the carbon dioxide reductions that the Bill mentions and that are widely acknowledged as necessary to future sustainability.
The Bill sets out methods whereby targets may be regularly reviewed. However, it would achieve more than that. Setting targets is easy; making them work is harder. Achieving targets is not only a question of money. The architecture of service provision and the framework for providing a utility can help to fulfil a target. The way in which a utility performs within a framework can help with setting a target.
Clauses 3 and 4 are especially important. Clause 3 exempts combined heat and power from the renewables obligation. In my view, CHP is important for several reasons. Although it is not a renewable, it is a near renewable. It is an immense efficiency improvement on traditional electricity generation and it is also an urban near renewable. Hon. Members have commented on the rural nature of many renewable sources of energy.
Combined heat and power can be set up in people's back gardens, in neighbourhoods and people's houses. It can power a street of homes right in the middle of cities, where other renewable sources would perhaps be inappropriate. The other urban renewable is photovoltaics and solar power. Combined heat and power can produce a series of small generators in urban areas, putting electricity into the grid. That is part of the future of energy generation.
Clause 3 exempts CHP generators from having to purchase renewable obligation certificates. That is an important step forward in generating the market. Combined heat and power is not experimental technology; it is market ready. It simply needs a fair wind to ensure that it works to provide the benefits that many hon. Members believe can be derived from a vision of large-scale installation of small and medium CHP generators across our urban landscape.
Brian White: When the Utilities Act 2000 was being considered, the Government did not intend to place a renewables obligation on CHP. That was down to drafting and it was not spotted at the time. It was therefore a mistake that needs rectifying.
Dr. Whitehead: It needs to be rectified whether it was a mistake or not. I hope that the Bill will complete its passage with clause 3 intact.
Clause 4 is important to making targets work. It places a sustainability requirement on the regulator. I agree with the comments of my hon. Friend the Member for Harrow, West (Mr. Thomas). In introducing the new electricity trading arrangements, the regulator's actions appear to run contrary to many of our aspirations,
which are set out in the energy White Paper, on progressing with sustainable electricity generation. It is essential that those policies go hand in hand. The electricity generation market's framework should move towards rather than away from sustainability. Clause 4 is important because it introduces the framework whereby we embed and support moves towards sustainability in the electricity generating market.When people switch electricity on and off, they should be switching increasing amounts of renewable electricity. That should be a target. If that process is embedded in people's lives and they make the country more sustainable in terms of energy, we will have secured a victory.
The Bill is an important step towards achieving our goal. I warmly support it and hope that it receives a Second Reading.
11.8 am
Mr. Christopher Chope (Christchurch): It is a pleasure to follow the hon. Member for Southampton, Test (Dr. Whitehead). We both once had a common interest in Southampton and the important work in that city on energy conservation. It was sad that the geothermal project in Southampton never worked in the long run.
Dr. Whitehead: I must contradict the hon. Gentleman. Geothermal energy now heats most of the city centre, including the college of higher education, the civic centre, the health centre and supermarkets. It is an astoundingly successful example of a renewable energy source that municipal enterprise has taken up and made to work throughout the city. It is a good example of what the Bill might encourage.
Mr. Chope: I stand corrected. That shows the danger of referring to the city that one had the pleasure of representing more than 10 years ago. I was always enthusiastic about the project and I am delighted that it is so successful. I am disappointed that the hon. Gentleman needed my intervention in order to make that point in this debate. Similarly, he made a good point on clause 3 in relation to the exemption of combined heat and power from the renewables obligation.
Another point that I would throw into the debate is the issue of solar-powered heating. When new construction, particularly of social housing, takes place, we are not as imaginative as many overseas countries in incorporating systems that enable water to be heated by solar power. The Government are heavily into subsidising and promoting solar energy, but converting solar rays into energy requires much more expensive technology than using the sun to heat water. I hope that we shall see more emphasis on this issue from the Government and more financial incentives for investment in solar-powered heating, rather than just in solar energy. A company based in my constituency, Global Solutions, has been lobbying strongly for such an outcome. Perhaps that could be spelled out more clearly in clause 1(2) when the Bill goes into Committee.
I was also interested in the speech made by the hon. Member for Tooting (Mr. Cox). Going back even further than 10 years, I used to be a member of
Wandsworth council. The hon. Gentleman made an important point about the difficulties that elderly people are in at the moment, particularly those who are just above the benefit level. He said that the current system of means testing meant that those people found it very hard to be able to afford to invest in systems that would enable them to have more fuel-efficient homes. If that is true in Tooting, which is part of Wandsworth—even after 1 May, a band D home in Wandsworth will be paying about £600 less per year in council tax than a band D property in Dorset—I am sure that hon. Members will realise how much more difficult it is for pensioners in those parts of the country that are not blessed with councils that have kept the council tax down as much as they have in Wandsworth or Westminster.One of the most interesting speeches today was made by the hon. Member for Brighton, Kemptown (Dr. Turner), who made a devastating critique of the White Paper. I am sure that I share with the whole House the sense of anticipation at the forthcoming publication of the Select Committee on Science and Technology report next Thursday. We shall wait to see whether it sets out a coherent, affordable and workable energy policy. I am sure that the Government will be very grateful to the Committee for the work that it has done. To describe a White Paper produced by one's own Government as "policy free" was brave, if not reckless, of the hon. Gentleman. The Government should, however, take his comments seriously, because he obviously comes to the debate with an enormous amount of experience and expertise.
I had a disagreement with the hon. Member for Brighton, Kemptown about the relevance of the pricing of electricity, but I think that he was talking about the wholesale price of electricity in Denmark and in this country. I, however, am concerned about the retail price, particularly in the context of elderly people and others being able to live in warm homes. The Government have already said that, as a result of the emphasis being put on renewables, there might be a need for individual domestic consumers of electricity to pay up to 15 per cent. more. In Denmark, they have to pay more than 70 per cent. more. There is obviously a higher proportion of energy generated by renewables there; it has the kind of level that is aspired to by many in the House and is referred to in clause 1 of the Bill. We should not think in those terms, however, without thinking through the consequences for the end users of our domestic power. That is particularly relevant in the context of fuel poverty, and pension and council tax poverty.
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