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The Chairman: Order. That is a happy convenience.
5.8 pm
Sitting suspended for Divisions in the House.
5.36 pm
On resuming—
Joan Ruddock: The hon. Member for Wealden made numerous points suggesting that the system was confusing—the hon. Member for Cheltenham followed up with similar remarks—and that it should be much simpler so that people could understand it. I thank the hon. Gentleman for his generous comments about my presentation. I have tried hard to make the issues understandable so that people can follow what is being changed. I am careful to try to ensure that our civil servants present things in an understandable way. The question, however, is whether the public need to understand the system, and the simple answer is that they do not. They need to understand that the Government want to help them to achieve more energy efficiency in their homes and why that matters.
Starting last autumn with the Prime Minister’s announcements, we have consistently conveyed that message to the public. Does it work? Yes, it does. We know that because we have set up two things, one of which is the ACT ON CO2 helpline. We have publicised the phone numbers widely. The helpline is run for us by the Energy Saving Trust. The number of inquiries rocketed when the helpline was introduced. Clearly, that is one means by which people get their information. People get their information using the means provided by the Government, but they also get it directly from their energy companies, which have their own marketing programmes to let people know what they are eligible for and what help they can obtain. The Government’s simple slogan covering the issue is:
“Save Money, Save Energy, ACT ON CO2”.
That is how the public expect us to communicate, and we do.
The hon. Gentleman suggested that the schemes were fundamentally flawed and that people needed much simpler information. I hope that I have shown how they can obtain that. He asked how the schemes and the changes in CERT and the new CESP will be communicated. There will be a certain amount of communication with the public about what is happening this week. I would repeat, however, that the public should be able to access appropriate information and find out their entitlements. Of course, the number benefiting from entitlements goes way beyond those who get free assistance from the energy companies because they fall into priority groups. It also includes those who get discounts—everybody could potentially get some discount. There are, of course, discounts for DIY installation and materials. That is how we think that it is appropriate to communicate, and we have done a more than adequate job on that.
The hon. Gentleman says that the schemes are not up to purpose because millions need insulation. I totally disagree about that because the schemes are up to purpose in terms of the existing legislative base. Unusually, we have increased the obligation on companies in the middle of the current spending period because we agree that more needs to be done. We are making the schemes work as effectively as possible and we are delivering on as great a scale as possible. It is true that millions more need insulation, and I will come to that shortly.
Essentially we are piloting comprehensive programmes that will provide us with the basis on which to move forward. That is an appropriate thing to do. We specified—I asked for this—that the initiative should be directed to low-income areas, because I want whatever we can deliver to benefit those who may suffer fuel poverty.
The hon. Gentleman said that the Government need a sense of direction, and I agree; I believe that we have that. We have produced the heat and energy-saving strategy, with consultation on that, and, as hon. Members have acknowledged, a White Paper is being published this week. In all those ways we are moving the agenda forward at pace, with complexity.
The hon. Gentleman asked about batteries running out in real-time displays. We have allowed for that. There is a 50 per cent. difference in the score for a company that markets or provides RTDs with batteries lasting only up to a year. Companies distributing equipment with longer lasting batteries will get a higher score. Clearly, we want long-life batteries to be used to ensure that people continue to use the equipment after the novelty has gone.
The hon. Gentleman asked that RTDs should not be a distraction and I agree, but the technology is important and teaches people a great deal. There is an export market, and we think it is right that we should encourage the British companies that produce RTDs to go on doing so. They are part of the scheme and will not hold up the roll-out of smart meters. We have already announced that we shall begin next year, and will continue until every home in the country has a smart meter. We cannot do all that work overnight, so why should we not use interim measures that make a great deal of sense?
The hon. Gentleman asked about energy advice and how it would be monitored. There will be proper monitoring by Ofgem. There is a sampling process and audit: it is about 5 per cent. of measures. The hon. Member for Wealden asked me about the RTDs and evidence of how they had worked elsewhere. I can give him some information that has been provided to me. A study was carried out by an official in 2006 who concluded from international studies that the average savings were between 5 and 15 per cent. When we factor them into the CERT uplift, we go for 3.5 per cent. so we have been very conservative about the savings.
Suppliers need to monitor and report to Ofgem, as I have said, and we will be partnering with suppliers on RTD roll-out to find out which displays have the greatest impact. We intend to learn from that. I have a list of different projects and companies, but because we have had such delays, I shall not read it. However, if the hon. Gentleman would like the information, I shall write to him.
The hon. Gentleman made many comments and criticisms about low-energy light bulbs. Has it all been a great mistake? Absolutely not. We have been pioneers in this country in bringing forward the CFLs. They have made important energy savings and will continue to do so, because they last so long. Once people have them, it is a long time before they have to be replaced. The hon. Gentleman is right about the tremendous potential of LEDs. I am a great fan of them. That technology will transform lighting in this country, and commercial lighting, in particular, might benefit very quickly. So, yes, I consider CFLs to be an interim technology, but there will be a great deal of overlap and they are very worthwhile.
The hon. Gentleman asked about health effects. When I was in the Department for Environment, Food and Rural Affairs and dealt directly with this matter—it is a DEFRA competence—we looked into the health effects and got the EU to do the same. We have acknowledged some small health effects, but the answer is for people to move to new generations of lights, rather than to try to hang on to their incandescent bulbs. There are various myths about the time CFLs take to brighten and the rest of it, but I can assure people that the recommended energy-saving light bulbs light up and go out quickly. That should not be a problem.
The hon. Gentleman asked about the focus on solid wall insulation and the points made by the Energy Saving Trust. We need to strike a balance; we need to do various things. As I have said, we shall do some testing, with a limit on behaviour change, but we also want solid wall insulation rolled out in greater numbers. We believe that both are possible. He also asked about the advice, which I have already covered. He said that it is not the right long-term solution and that we need to go much further. He also said that we are confused about energy efficiency and fuel poverty. We are not confused. We want every household to be as energy efficient as possible, but there are costs related to energy efficiency, so we constantly have to factor in and watch the impacts on fuel poverty. We shall continue to do that.
The hon. Gentleman recommends his own scheme—the £6,500 scheme. That point is constantly repeated by Conservative Front Benchers, but my letter, in April, to the hon. Member for Tunbridge Wells (Greg Clark) remains unanswered. We have costed the programme and it is an impossible cost. We would truly like to know how he would make it work. The hon. Member for Wealden ended by saying that he hopes to see a lot in the energy White Paper. I assure him that he will see a great deal in that paper and that he does not have long to wait.
The hon. Member for Cheltenham made some similar points regarding existing homes. We agree that new homes should be carbon neutral and that we need retrofitting programmes as well. He also referred to LEDs, which I have covered. He said that CESP can be part of the solution, but that much more fundamental work needs to be done. He mentioned the complex scores, guesswork and so on. I must tell him, however, that we know what savings have been achieved through the programmes that ended in 2008-09. The Warm Front scheme delivered savings of 9 million tonnes of CO2, and CERT produced savings of 93 million tonnes of CO2, 38 million of which were carried over from the previous obligation on companies. Overall, CERT and Warm Front have delivered savings of 64 million tonnes net—CO2 not carbon.
Martin Horwood: I am impressed by the figure of 93 million tonnes. Is that actual measured savings or extrapolated over a product’s lifetime and so on?
Joan Ruddock: I am not sure of the point that the hon. Gentleman is making. We know about products and what they save. If we have a product, and we know its savings, we can do the arithmetic and end up with a final figure. I am not sure what other methodology he would wish to employ that would give a different answer. He might like to make a suggestion.
Martin Horwood: I will suggest one refinement. Given that the savings over the products’ entire lifetime go some distance into the future, as most of the products are still in place, there is presumably a difference between the savings achieved and banked to the scheme’s credit and the much smaller savings that have actually been made.
Joan Ruddock: We can say what has been done in a particular year or cycle. At other times, we talk about lifetime achievements, because measures, equipment and so on stay in place and continue to function for a period of years. In the case of insulation, that period can be as long as 40 years. I acknowledged that at the moment we do not know for how long people’s behaviour will remain changed with things such as RTDs and advice. That is why we are scoring the anticipated outcomes conservatively. At the moment, all that we have from reports and research studies is a couple of years, because the measures are new. I acknowledge that there are—
Martin Horwood: It’s guesswork.
Joan Ruddock: It is not guesswork. It is not absolutely certain how long the behaviour change will last. We cannot say at this stage, “If this piece of equipment lasts for 15 years, the behaviour change that occurred in years 1 and 2 will continue.” That is why we have scored conservatively. We have made allowances for that. More might be suggested, but I am quite clear about what I am saying.
I am advised to give the further information that we undertake independent reviews into the phases after they are completed. As a result, savings from previous phases increased from 1.8 to 2.1 million tonnes of CO2. When we go over the figures, they sometimes vary, but that is made transparent. There is no question of pretence or of trying to fool anybody. The assumption that hard measures such as loft insulation are uncertain is just not reasonable. They are proven, and we can be certain of what we are doing in that area. None the less, the hon. Gentleman says that he wants us to do more and more. Ultimately, he either accepts that the programme is worth while, and that loft and cavity insulation are worth while, or he does not. Perhaps he is quibbling a little too much.
The hon. Gentleman asked about small areas and the index of multiple deprivation. We do indeed use super output areas, so his area would be covered. He criticised us about the small numbers in CESP. Again, that is the nature of an interim period. We are gaining information. While we have been consulting on CESP, we have been learning how to do things and working out how to put much more comprehensive schemes in place. We anticipate that all cavity walls and lofts will be filled by 2015. We have no doubt about the urgency required, and we intend to get on with it.
The hon. Member for Leominster asked me a specific question about connections to the gas grid and switching. There is no doubt that switching can be extremely helpful and can lower people’s bills significantly. We therefore think that it is appropriate, even though there is a potential cost involved in putting in a meter. Overall, it is definitely a saving and well worth having for both the customer and the climate.
Bill Wiggin: I agree with everything that the Minister has just said. I would like to consider giving Ofgem a well-aimed kick for the hidden cost of gas. I discovered that for myself when I tried to move my meter and found that the minimum cost of moving a meter less than 2 m—6 ft—is £1,000. Hidden costs like that would hit hardest the very poor households that the hon. Lady is targeting. I therefore think that a regulatory body such as Ofgem should be looking at protecting people from such a monopoly power.
Joan Ruddock: I agree, but given the scoring, the approach and the obligation on the energy companies under the schemes, I am not certain that they would pass on such a charge because it would not make great sense. Unless I am contradicted, we would not expect a charge of that magnitude to be passed on. Perhaps the company just recognised the hon. Gentleman and told him that.
Bill Wiggin: No, it is a national thing. Shall I send the Minister details?
Joan Ruddock: Please do. The hon. Gentleman raises a very interesting point and I shall be happy to look into it.
I have endeavoured to answer all the points made by members of the Committee. I am confident that the CERT and CESP programmes are important in terms of both addressing climate change and reducing future household bills. CERT is already delivering such benefits and the order will enable even more homes to benefit with immediate effect. The new CESP programme will further expand the benefits specifically to those in vulnerable, low-income groups, as fuel bill savings can make a significant difference to a householder’s income.
I hope therefore that members of the Committee will support the CERT and CESP orders so that those who will benefit from them can begin to do so as soon as possible. We hope to have the measures in place soon, and clearly it is important that they should be in place ahead of the winter—not that we can perhaps contemplate the winter at this stage, but it will surely come and we want the measures to be in place. I commend the orders to the Committee.
Question put and agreed to.
Resolved,
That the Committee has considered the draft Electricity and Gas (Carbon Emissions Reduction) (Amendment) Order 2009.

DRAFT ELECTRICITY AND GAS (COMMUNITY ENERGY SAVING PROGRAMME) ORDER 2009

Resolved,
That the Committee has considered the draft Electricity and Gas (Community Energy Saving Programme) Order 2009.—(Joan Ruddock.)
5.57 pm
Committee rose.
 
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