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Westminster Hall

Wednesday 3 March 2010

[Frank Cook in the Chair]

Home Energy Efficiency

Motion made, and Question proposed, That the sitting be now adjourned.-(Mr. Heppell.)

9.30 am

Malcolm Bruce (Gordon) (LD): I am pleased to have the opportunity to raise the issue of home energy efficiency and fuel poverty. When I applied for the debate, there were a few key issues that I wanted to bring to the Chamber's attention and to press the Government on, but I was inundated with a huge variety of information and lobbying from a great diversity of sources. I must apologise to some of those people who brought such issues to my attention because I cannot address them all, but perhaps other Members will. I shall concentrate on a few areas in which I have a particular interest or concern.

On the basic issue of fuel poverty, we should recognise that we are almost back to where we started from 10 years ago. We saw a dip in fuel poverty, but it has risen sharply and it is estimated that between 4.5 million and 5 million households across the United Kingdom are in fuel poverty, which is back to the same levels that we experienced 10 years ago. Being a Member of Parliament for a Scottish constituency, I must emphasise that the proportion of people in fuel poverty or suffering from the problems of high-cost heating is much higher. Statistics compiled by the House Condition Survey in Scotland show that 618,000 households in Scotland-27 per cent. of the total-are in fuel poverty, which is up 47 per cent. over the past five years. A third of those are in extreme fuel poverty, by which I mean that they spend more than 20 per cent. of their income on fuel.

Energy Action Scotland believes that even those figures are an understatement and that as many as 750,000 households could be in some degree of fuel poverty. Such statistics are central to the debate, but for every household in fuel poverty, there are others who are not technically in poverty but have real problems with heating their home and paying their bill, and they are equally interested in what the Government can do to deal with the situation.

I shall raise a few aspects of home energy efficiency and fuel poverty, and await the Minister's reply with interest. Let me start with hard-to-treat homes. It is astonishing to discover what proportion of the UK housing stock is classified as hard to treat. Some 43 per cent. of households in England and more than 50 per cent. of households in Scotland are, in one form or another, hard to treat. They are mostly houses with solid walls or the early timber-framed houses, and flats and homes in multiple occupancy.

Under the carbon emissions reductions target, energy companies are required to promote insulation and efficiency, but evidence suggests that they tend to take the easy way out by, for example, issuing low-energy light bulbs rather than investing in significant insulation or alternative
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forms of heating. Hard-to-treat houses have pretty well been ignored by the energy companies. For many, the main way to tackle the problem is through external wall insulation, or external cladding, or, in some cases, internal cladding. By definition, such houses are hard to treat. Cavity wall insulation or loft insulation does not do the job. In addition, they need lower cost, carbon-free, low-tariff fuel systems, and for many, the packages are simply not available.

It is worth recording the fact that the social housing sector faces huge bills to tackle the problem. Dealing with the existing housing stock reduces the pool of funds available for providing new houses. A couple of examples have been brought to my attention. Aberdeen city council, which has been considering its high proportion of hard-to-treat houses, has recently upgraded 4,505 dwellings in multi-storey flats through a combination of cladding and combined heat and power district heating systems. The cost of the cladding was such that the council concluded that it could not clad them all. Effectively, it ended up installing more efficient heating systems, which heated the air as much as the buildings. Therefore, although such a system was beneficial to the tenants in that they could afford the heating, it did not solve the entire problem of the waste of energy.

Orkney council has also instigated a pilot scheme and spent £3.5 million on external cladding on a number of its houses. All over the country, local authorities and housing associations are independently tackling the problems without any real exchange of information or co-ordination, which is not the most efficient way to deal with the matter.

David Simpson (Upper Bann) (DUP): I welcome you to the Chair, Mr. Cook, and congratulate the right hon. Gentleman on obtaining this Adjournment debate. He will know that the Scottish Government home insulation scheme attached some criticism to the time it was taking to bring schemes to different areas of Scotland and to bring homes up to standard, as was the case with Northern Ireland in relation to the criteria used for how people apply for such schemes.

Does the right hon. Gentleman think it would be beneficial for the two regional Ministers to consult, and therefore exchange ideas, on how we could move the schemes forward and help in particular those suffering from cancer, who really suffer from the cold and need their homes to be insulated?

Malcolm Bruce: I take the point. As the hon. Gentleman will know, I believe in devolution, but I do not think that that means that we cannot co-ordinate effectively. The UK Government have a role to play in encouraging such co-ordination, particularly when it is about facts, information, best standards, value for money and cost-effectiveness. I completely agree with him, and the Minister will have his opportunity to address that matter. I will say only that the Government roll out schemes one after another, but it is difficult to find out how they co-ordinate them.

Let me finish on the issue of hard-to-treat homes. I have had a long and extended conversation with one particular constituent who is exercised by the issue. She is very aware of what is going on, and thinks that a lot of her neighbours do not realise how inefficient their homes are. She has had a thermal imaging take done on
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her house, which shows just how much energy is leaking, and her house is the same as all the others in the street. Her concern is that no one will tell her what is the best thing to do. She does not know what materials to get, there is no financial assistance or technical advice, and she has not been able to resolve her problems. She suggests a co-ordinated approach that applies the best technique and best advice, possibly reducing or abolishing VAT on the materials and providing certificated standards across the country. The Government should consider such issues rather than just accept the appalling situation in which half our housing stock is hard to treat and we have no co-ordinated response to deal with it.

Let me say as an aside-I do not want to dwell too long on this-that whenever we discuss the issue we should also consider the extra winter deaths that are directly attributable to fuel poverty. Such deaths have increased this year because of the cold winter. That issue never arises in Scandinavian countries because they do not have hard-to-treat homes. They have much better standards and efficiency, and I believe that we, too, should tackle the problem in a much more effective way.

Christopher Fraser (South-West Norfolk) (Con): Does the right hon. Gentleman agree that in rural areas such as Norfolk, where my constituency is located, an awful lot of retired people and pensioners have no choice but to use oil, because no other source of energy is available to them? They are penalised for living in a rural area and by the punitive costs that the oil companies place on them. Therefore, their poverty becomes worse.

Malcolm Bruce: I am very grateful for that intervention, because it precisely anticipates the next paragraph of my speech, which is about that point. People in rural areas who do not have access to mains gas depend on other forms of heating-mostly oil, but sometimes liquefied petroleum gas or some other alternative.

I was surprised by the figures on the issue. They might be incorrect and the Minister might have more accurate ones, but my information is that 1.5 million households do not have access to mains gas and 1 million of those households are in Scotland, which is a much more rural country. The rest are probably in Norfolk-I do not know.

The cost of heating fuel for someone who is not on the gas mains is, on average, a third higher than for someone who is on the gas mains. I have been a Member of the House for rather a long time and when British Gas was being privatised, I served on the Committee scrutinising the Bill that privatised it, which became the Gas Act 1986. I also got involved in a stand-up, dragged-out row with Sir Denis Rooke-not a difficult thing to do-on behalf of my constituents at the time, because the gas mains were not being extended. As a result of that row, I got significant gas mains extension in several communities across my constituency.

However, I predicted that the privatisation of gas-this issue is about not the ideology of privatisation, but its consequences-would pretty much stop the extension of gas mains to anything other than major new developments, which has happened, although it is somewhat unacceptable.

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In that context, if the Government are unable to do more to ensure the extension of gas mains-I would add that, even if they do ensure that extension, a lot of properties cannot be put on the mains-I wonder whether they will specifically address the needs of those households that are not on the gas mains.

Mr. David Drew (Stroud) (Lab/Co-op): I congratulate the right hon. Gentleman on securing the debate and on his speech. However, the situation is even worse than he describes, because the gas companies hold the individual households to ransom, charging ridiculous sums for connection fees. That is so unfair, given that the connection fees for everybody else who is connected were all lost in the capital costs. Those people without connection are being forced to pay the total cost of connection.

Malcolm Bruce: I completely agree with that point. At the time of the privatisation of British Gas, I formed a good alliance with the gas regulator, who challenged British Gas over its assertion that it could not afford such connection costs. He said that, if he was not satisfied with the costings of British Gas, he would force it to absorb the costs itself and he did so. Unfortunately, such engagement does not appear to exist any more.

Therefore, I repeat my question to the Minister: why, for example, should the energy companies not be required to prioritise in their alternative energy, renewable energy and insulation programmes those people who are not on the gas mains? Furthermore, on the proposal to introduce micro-combined heat and power, which could be a benefit, why are the Government also proposing a tax break that will make micro-CHP less attractive for gas and oil-fired CHP systems, even though those systems double the efficiency of a house's heating arrangements?

It seems to me that there are things that the Government could do to ensure that people in rural areas who are off the gas mains receive priority treatment from the energy companies, but there is no indication that the Government are prepared to do those things.

Christopher Fraser: Does the right hon. Gentleman agree that it would help matters if the Warm Front scheme allowed double glazing to be put into those properties that are not on the gas mains, which it does not allow currently?

Malcolm Bruce: I am sure that that would improve matters. The hon. Gentleman will appreciate that we have a different arrangement in Scotland, but I am aware of the issue involving double glazing. Double glazing is not the most efficient measure that may be taken, but clearly it is a relevant factor. There is not much point in putting in cavity wall insulation and loft insulation if all the heat goes out of the windows.

I want to move on to a subject that is topical, given the cold winter-cold weather payments. They are a very specific mechanism for dealing with fuel poverty. However, the mechanism for delivering cold weather payments means that millions of people lose out on them. It is estimated that 1.7 million people who would be entitled to the pension guarantee have not applied for it, and because they have not applied, they do not achieve the threshold-the "gate", as it were-and so they are not eligible for cold weather payments, which they would otherwise automatically accrue.

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In my constituency, it is estimated that 1,600 pensioners would be eligible for cold weather payments, but they have not applied for them, and I am sure that other Members have similar figures for their own constituencies. I do not wish to labour the point, but it is simply a geographical fact that Scotland is colder than the average for the United Kingdom.

Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): Oh yes!

Malcolm Bruce: Said with feeling by my hon. Friend.

The cost of heating a house in Stornoway is 62 per cent. higher than that of heating an identical house in Bristol. Within the cold weather payments, no account is taken of that fact. Therefore, the contribution that those payments make to people who live in colder parts of the United Kingdom is reduced.

I can testify that, in my own part of the world, we have had snow on the ground pretty well continuously, with only the odd break of a couple of days, since before Christmas. We have also had frost pretty well every night, and indeed for most of the day, for most of the period since Christmas.

Dr. William McCrea (South Antrim) (DUP): I accept that it might be colder in Scotland than in other regions of the United Kingdom, but does the right hon. Gentleman accept that wages for people in Northern Ireland are lower than for those in the rest of the UK, and that, therefore, a higher percentage of people's wages is used to heat their homes? People have to choose between heating their home and putting food on the table. That is a great cause of concern within my constituency.

Malcolm Bruce: Of course I completely accept the important point that the hon. Gentleman makes, and that situation increases the incidence of fuel poverty, given the percentage of people's wages that is being spent on fuel.

I want to give an example. I am sure that many of us are out pounding the streets and highways and byways of our constituencies at the moment, even more frequently than we are wont to do normally. I left my home on Saturday morning to do just that. The temperature when I left was -6° C and there was about 20 cm of impacted snow on the ground outside my house. By the time I reached the Aberdeen city part of my constituency, the temperature had reached 6° C and there was no sign of any snow-indeed, the crocuses were up and the daffodils looked as if they were coming out.

However, that area in Aberdeen city is the base from which the cold weather payment calculation for the inland western part of my constituency is determined. As I say, the temperature difference between different parts of my constituency is astonishing.

I make a plea on the issue regularly, but I again want to say something, quite specifically, about the weather stations that determine where cold weather payments are made in my constituency. The two most important stations are at Dyce and Braemar. Anybody who knows Scotland will know that Dyce is 3 miles from the coast and that Braemar holds the record for the lowest recorded temperature in the United Kingdom. However, one part of my constituency, around Alford, receives cold weather payments based on Braemar. Meanwhile, 3 miles up the road in Huntly, which is further inland and further up
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the hill so that there is more snow and lower temperatures, people have their cold weather payments assessed from the coast at Dyce. That is ridiculous and unjustifiable.

I simply say that the cold weather payments for that part of my constituency-the Huntly area-should be based on temperatures in Braemar, or temperatures somewhere else more appropriate than Dyce, possibly Aviemore. They should certainly not be based on temperatures in Dyce. That is my special plea, and I have to say that it is a very important point. If the Minister ever wished to come to my constituency, I could show him the temperature difference between different parts of my constituency with no difficulty whatever.

Thanks to a lot of pressure from Members in all parts of the House, the Government are in the process of introducing feed-in tariffs. However, I refer to the early-day motion tabled by my hon. Friend the Member for Orkney and Shetland (Mr. Carmichael) on that subject, which I have signed, as have many other Members. Fundamentally, the issue is that those people who have pioneered the use of generating capacity run the risk of being penalised for being involved in that area too early.

I want to press the Minister on the issue, because there is some suggestion that a review is going on to determine whether people who have already installed generating capacity that feeds into the grid should benefit from the new arrangements, rather than being penalised for being pioneers.

For example, I have a constituent who has told me that he installed a solar photovoltaic system in two phases-1.82 kW of capacity in July 2008 and a further 2.56 kW of capacity in July 2009. He has two issues. One is that the equipment he used was subject to microgeneration certification scheme approval guidelines. His concern is that the scheme approves only the most expensive systems. He was able to find cheaper systems that met European standards but not the certification standards, and he thinks that that is inefficient and unfair. Again, I leave the issue with the Minister.

My constituent's second and more specific point, having made that investment, concerns why on earth he should not benefit from the feed-in arrangements. I know that my constituent would be extremely pleased and grateful if the Minister gave him some encouragement.

Bob Spink (Castle Point) (Ind): May I take the right hon. Gentleman back to UK-wide matters on the cost of energy? I wish to make three brief points. First, does he agree that the hundreds of social tariffs should be simplified and standardised, and that they should be more generous? They are very confusing and do not give everyone access. Secondly, we should end the obscenity of people on pay-as-you-go tariffs, with the poorest in society paying more per unit of energy. Thirdly, we must ensure that people without access to direct debits-again, the poorest in the country-have access to the discounts that are available.

Malcolm Bruce: Those are pertinent points, and I am sure that the Minister will take note of them. However, as I said at the outset, there are so many dimensions to the matter that it is impossible to cover them all in one speech-and I am now near the end of mine. Indeed, if I tried to cover all those points, I might get less useful answers from the Minister on the particular issues that I wish to raise.

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