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Subsidised Electricity

4. Matthew Taylor (Truro and St. Austell) (LD): What saving in the typical household bill has resulted from the subsidy to electricity consumers in northern Scotland under the scheme introduced in April. [24337]

The Minister for Energy (Malcolm Wicks): If we had not replaced the hydro benefit scheme, the typical household bill in northern Scotland would have gone up by £27 per year and fuel poverty in the area would have increased by around 15 per cent.

Matthew Taylor: Will the Minister have a word with his colleagues in the Department for Environment, Food and Rural Affairs to explain why a subsidy is provided that saves electricity bill payers in northern
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Scotland £27 a year, paid for by electricity consumers across the rest of the country and legislated for by this Government, when they rule out help for South West Water customers, who pay double the London bills—not £200, but £400 on average? Those bills are set to rise to £700, even though they are already the highest in the country and are clearly unaffordable. Why is it that electricity customers can be helped in the north of Scotland, but no such help can be allowed for South West Water bill payers?

Malcolm Wicks: It is a clever link, but each utility has different circumstances, ownership, regulatory regimes and costs. I know that my hon. Friend the Minister for Climate Change and the Environment has talked to the hon. Gentleman about that matter. I do not want to get into deep water, so I will not trespass on DEFRA territory.

Linda Gilroy (Plymouth, Sutton) (Lab/Co-op): My hon. Friend has one of the longest track records in tackling and understanding fuel poverty. Will he therefore do all he can to help those of us who are determined to tackle water poverty and bring the issue not only to the attention of Ministers in the Department for Environment, Food and Rural Affairs, but those in   the Department for Work and Pensions and the Treasury? We need all the help we can get to tackle that serious problem.

Malcolm Wicks: We certainly recognise concern about high water bills in the south-west. The cross-Government review of water affordability was published in December 2004, I believe, and my colleagues are following up its recommendations. I will obviously bring those concerns to the attention of my colleagues in DEFRA.

Nuclear-generated Electricity

5. Mr. Desmond Swayne (New Forest, West) (Con):   If   he will make a statement on the future of nuclear-generated electricity. [24338]

The Minister for Energy (Malcolm Wicks): As part of   our general policy to focus on the climate, reliability of energy supplies and affordability for the customer, my right hon. Friend the Prime Minister has said that we will publish proposals on energy policy next year, and the question of civil nuclear power will be thoroughly and objectively considered.

Mr. Swayne: Is not nuclear energy a renewable source of energy?

Malcolm Wicks: There is a technical debate about that. Certainly, nuclear energy shares some scientific characteristics with wind and solar energy. However, although there is a lot of uranium around, it is by definition not a renewable. In any case, those scientific distinctions do not have any impact on the different policy courses that we need to follow.
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Mr. David Chaytor (Bury, North) (Lab): Will my hon.   Friend remind the House what happened to the last Prime Minister who promised to build 10 new nuclear power stations and remind us how many of them were built?

Malcolm Wicks: I am happy to take history tutorials from my hon. Friend, but the fact is that if we are reviewing energy policy, it makes sense to look scientifically and objectively at the question of the future generation of nuclear energy. My right hon. Friend the Secretary of State and I have both said that we are nuclear-neutral at present. In other words, we approach the matter open-minded, but not empty-headed.

Mr. Michael Jack (Fylde) (Con): At a recent meeting   at the Westinghouse fuels division plant in my   constituency, the trade unions rightly drew my attention to the world-class nature of our nuclear fuels manufacturing capability. However, if there is a positive outcome for nuclear in the debate to which the Minister referred, may I have his assurance that the time scale will be short enough to ensure that the skills may be retained in our UK fuel manufacturing capability?

Malcolm Wicks: It is certainly the case that the nuclear industry, like other parts of the energy industry, such as oil and gas exploration, is demographically challenged—to use the terrible jargon. In other words, there are more people aged 50 and over than there are younger entrants. I am giving some priority to the skills issue in the energy industry generally and I have discussed it already with the nuclear industry and other parts of the energy sector. Britain, and especially Scotland, is a centre of excellence for energy, not least because of the skills of our work force, and we need to maintain and improve on that.

Anne Moffat (East Lothian) (Lab): My hon. Friend will be aware that I am pro-nuclear—as opposed to the position he set out as regards himself, the Secretary of State and the Prime Minister in relation to the review—on the basis that there is a nuclear power station in my constituency and 50 per cent. of Scotland's electricity is generated from nuclear power. As there is a possibility of new build, does my hon. Friend share my concerns that the devolved Parliament in Scotland will try to use its planning permission powers to prevent that?

Malcolm Wicks: That is an important secondary, or tertiary, question but the primary question is whether, having studied the evidence, the Government should give a lead in a new generation of nuclear. We are not there yet. If we did so decide—I repeat, if—those important issues about Scotland and planning would need to be discussed among colleagues.

Pre-payment Meters

6. Mr. Edward Leigh (Gainsborough) (Con): Whether the number of people using gas and electricity pre-payment meters has changed as a result of the measures Ofgem has taken to improve billing practice and tighten suppliers' licence conditions. [24339]
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The Minister for Energy (Malcolm Wicks): In July 2005, following a complaint by Energywatch under the Enterprise Act 2002, Ofgem conducted an investigation into the billing practices of gas and electricity suppliers. It made a number of recommendations, designed to take   effect in July 2006. There is no reason why those recommendations, or the measures taken to implement them, should materially change the number of customers using pre-payment meters. Indeed, there are 3.6 million electricity and 2.1 million gas pre-payment meter customers.

Mr. Leigh: As the Minister has made clear, more than   5 million people pay for their gas or electricity with pre-payment meters, despite their being some of the poorest people in the community. In March, the Public Accounts Committee found that on average they were paying a premium to the companies of £60 a year. That is unacceptable. What actions have the Government taken since our report was published to rectify the situation and how much has the premium reduced since that time?

Malcolm Wicks: This is a matter that concerns me but it is not an easy one. The question is whether those choices should be allowed to the customer; I think they should. There are difficulties with pre-payment meters such as the extra costs, which I acknowledge. I worry about that too, but the alternative might be more disconnections and there are many evils associated with that. The matter is difficult and we need to approach it in a balanced way.

David Taylor (North-West Leicestershire) (Lab/Co-op): One obvious problem with pre-payment cards, as well as disconnections, which the Minister has just mentioned, is that if the card is not charged no fuel   is   supplied. A quarter or more pre-payment users self-disconnect in that way every year and a much higher proportion of them are gas users, which reflects the lower income profile of people forced into that position. Will the Minister tell us what he intends to do to tackle that problem?

Malcolm Wicks: As I said, this is a difficult issue because if people were in different systems and there were rising numbers of disconnections, the House would properly be concerned, as some of us have been in the past. We need to enable more customers to be given the   information to make proper choices, including the choice of switching back to the type of payment methods that many of us enjoy. In that sense, the launch of the industry home heat helpline on Monday is important, as it means that a customer, or someone concerned about their welfare, can phone up for advice on those issues.

Mr. Mike Weir (Angus) (SNP): When asked about fuel poverty, Ministers often make the point that consumers should consider switching suppliers, but that   is difficult for people on pre-payment meters, which must be one of the few examples where people are penalised by paying cash in advance. Will the Minister look again at the matter to see whether there is any way in which the electricity and gas companies can be forced to give a
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better deal to those who have to pay through pre-payment meters? Most people do so because they have no alternative but to use such meters.

Malcolm Wicks: There is some switching between suppliers for people on pre-payment meters, but I   acknowledge that that occurs at a lower rate than for other customers. Will I look at the matter again? Yes I   will, because it is a serious concern. We want people on low incomes to be able to enjoy the kind of facilities that we all enjoy. It is true that in this case the poor pay more due to the charging structure. I will look at it again.

Mr. Brian Jenkins (Tamworth) (Lab): That is the point. For a long time my hon. Friend was missing the point of the question. He talked about the market, but not about discrimination by companies against people who opt for pre-payment meters. On several occasions, Members on the Front Bench have defended the marketplace, and the openness of the marketplace, while Opposition Front Benchers and the previous speaker, the hon. Member for Angus (Mr. Weir), have called for more Government intervention and control. On what date did we switch places?

Malcolm Wicks: It's a funny old week, isn't it?

Clearly, pre-payment meters involve capital expenditure. If there was no price differential, other customers, including many low-income people and many pensioners, would have   to subsidise those on pre-payment meters. These are difficult issues. I am not relaxed about the fact that so many low-income families have different payment methods from the mainstream of society. I repeat that there is no easy solution, but I have told the hon. Member for Angus (Mr.   Weir) that I will reconsider the issue.

Mrs. Theresa Villiers (Chipping Barnet) (Con): Would the Minister be prepared to consider looking again at the regulation of the energy market to encourage the installation of smarter, more high-tech meters across the board? The advantage is that the consequences of consumers' energy choices would be   much more visible to them. With that visibility, we could encourage and enhance energy efficiency among consumers because they would instantly see the energy consequences of the appliances that they choose to use in the home.

Malcolm Wicks: The short answer is yes. I am very interested in the concept of smart metering, particularly if it could tell householders how much CO 2 their dwellings were emitting and, with micro-generation in the   dwelling, they could see the savings that they were making. I understand that there has been a roll-out of smart metering in Italy, so the European experience can be considered. We are discussing that option with Ofgem. The investment required would be expensive, but to repeat my short answer, yes, it is worth considering that option.

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