Saturday, 14 January 2012

Fighting the fight against Fuel Poverty

Jobs matter, housing matters, so many things matter...
But fuel poverty is an issue that cuts across politics, and it matters to those who are really struggling. It affects those who have to pay at least 10% of their income simply on heating. In the North East we have 24% fuel poverty and, in Hexham, it is one of our biggest campaigns. Following on from the appearance of Mike and Lauren, representing the North Tyne and Allendale Oil clubs, at the all party DECC select committee, we had a very interesting debate in the House of Commons on Wednesday and it is worth analysing the debate. I could not persuade the Speaker to call me to speak but was able to get in three key questions:
1. To the Labour Energy spokesman, Caroline Flint:
Guy Opperman (Hexham, Conservative)
Today the Select Committee on Energy and Climate Change heard some of my constituents give evidence on the issue of off-grid energy. May I ask a simple question? Is the Opposition’s policy to regulate it—yes or no?

Caroline Flint (Don Valley, Labour)
We have had a number of debates on the subject. One of the problems with off-grid energy is that some of the schemes that the Government are coming up with do not help the people who are affected by it. I shall say more about that later in the context of the green deal. There are real questions about who will be excluded, but we are talking today about energy prices, and about what we can do to make the market more competitive and responsible.

I look forward greatly to learning what the Select Committee has discussed in relation to off-grid energy, and will think about some of its recommendations. We will make up our own minds about what we should do, but I acknowledge that there is a problem. During the three months for which I have had my present job, it has arisen many times in debates. I also acknowledge that there are insulation problems for many people in rural communities whose homes have solid walls. I am afraid that I cannot give the hon. Gentleman chapter and verse today, but he can be reassured that the issue is on my radar.

2. Then to the Liberal Secretary of State Chris Huhne, to see what he would do:
Guy Opperman (Hexham, Conservative)
I merely reiterate the point that with 24% of the north-east in fuel poverty, the situation in relation to heating oil and liquefied petroleum gas for off-grid customers is clearly unsatisfactory. Does the Secretary of State accept that and what specifically does he intend to do about it?
Christopher Huhne (Secretary of State, Energy and Climate Change; Eastleigh, Liberal Democrat)
My hon. Friend makes a good and important point. People who are off-grid have traditionally had to deal with substantially higher costs than those who are on grid, and that continues to be the case. The case for regulating off-grid is weak, because as long as the market is competitive, it ought to deliver a reasonable result for consumers. I was surprised, as were other members of the ministerial team, that when we asked the Office of Fair Trading to look at the market, it was
given a clean bill of health on competition grounds. We need to continue to watch this situation and we are very much on the case. With the renewable heat incentive and the green deal, it will be important that people who are off-grid think about other options rather than being reliant on heating oil, such as ground source heat pumps and biomass, which can already be cheaper than on-grid options.

Regular readers know that we think that the OFT report was a simplistic white wash - a point I put slightly more gently to my neighbour over the border in Durham:

3. Guy Opperman (Hexham, Conservative)
I am the hon. Lady’s constituency neighbour and we share a great deal of common ground on the issue of off-grid problems. So far as my constituents are concerned, there is no genuine competition and fairness of pricing in respect of off-grid, so from their point of view the report by the OFT, which was only a market study, is manifestly insufficient and not right. Do her constituents convey the same concerns?

Pat Glass (North West Durham, Labour)
Yes, exactly the same issues are raised in my constituency surgeries. The OFT accepted that in some parts of the country there are fewer than three suppliers, but in practice even though there may be three advertised suppliers, sometimes only one company is prepared to deliver. That is certainly the case in parts of my constituency, and I am sure that is also the case elsewhere. That may not be a monopoly in the view of the OFT, but for my constituents it is definitely a monopoly. Some of my constituents were faced with increases of almost 100% in heating oil prices in the run-up to Christmas last year, and only one company was prepared to deliver. I call that a monopoly. I urge the Government, and my party’s Front-Bench team, to look again at the regulation of this sector.

We will continue to press the case that there is no real competition and fairness in the provision of heating oil and LPG, and highlight those local companies who are providing a fair rate for their fuel. The DECC committee hearing is available online early next week and I will post it when I have it.