Energy Bill

My Lords, I shall speak also to Amendments 1A and 1C. The amendment may seem long but I can assure noble Lords that its purpose is very straightforward. I think that it is also helpful in setting the Bill into the context of government policy and existing government legislation. The Government have indicated very great ambition for the Green Deal, and I will come to that during the course of today’s debate and further debates. However, what is not clear from this legislation is how those ambitions will be met. The intention of this amendment is to ensure that all aspects of Part 1 of the Bill—that is, the Green Deal, the private rented sector and the other measures—are grounded in the purposes that the Secretary of State has indicated in both the impact assessment and in various speeches and press releases that we have seen from Ministers in the department. The intention of the subsequent four clauses, and the three that I am speaking to, is to define a purpose for Part 1—to place a duty on the Secretary of State, as we will hear from my noble friend, and on Welsh Ministers to produce a plan for improved energy efficiency, and also to create a means of reporting on progress towards achieving the aims set out in that plan. I will say something briefly about each clause. The Secretary of State has described the Green Deal programme as, "““the most ambitious energy-saving plan ever put forward””." If that is the case and it is to be achieved, we need to see that ambition grounded in a concrete set of objectives so that it is more than just an aspiration and really does become a reality. The Government have indicated that the purposes of the Green Deal and the related proposals that appear in Part 1 are: to improve the energy efficiency of existing building stock in the UK, including household and non-domestic properties, in order to reduce greenhouse gas emissions cost-effectively and fairly; and to contribute—I emphasise this—to our legally binding targets and improve the security of the UK energy supply. Under those legally binding targets, the UK is committed to achieving a 34 per cent reduction of CO2 emissions by 2020 relative to 1990, and at least an 80 per cent reduction by 2050. As the impact assessment—a weighty document—makes clear: "““There remains a considerable amount of cost effective abatement potential from energy efficiency measures in the domestic and business sectors which, if taken up, will mean that Carbon Budgets are met at a lower overall cost to society””." The Government have indicated in their summary proposal for the Green Deal that they need to cut emissions in homes by 29 per cent by 2022 based on 2008 levels, which they say will deliver on the target of 34 per cent by 2020. That is obviously an inadequate ambition, and it is not properly defined in the Green Deal document how they will ensure that this really is delivered. Therefore it makes real sense for the ambition of the Green Deal to be linked to the scale required for carbon budgets and take into account the recommendations of the Committee on Climate Change for the future budgets. As the Green Deal is a programme that lasts into the 2020s and through to 2030, the Government will want to ensure that they are delivering at the scale and pace required to meet the carbon reduction targets. We know that the Government’s objective is to make the Green Deal work, ensuring serious carbon reductions. As the Minister Greg Barker said: "““The new Green Deal initiative will help us achieve, or exceed, the binding targets for carbon reductions set during the previous administration””.—[Official Report, Commons, 6/7/10; col. 148W.]" He also said: "““We basically need to retrofit the entire housing stock””," but he does not define what that retrofit would achieve. So there is a clear lack of detail. For the Government to state that they want to transform the whole housing stock and yet not indicate what this transformation will look like or what this means for carbon reduction energy saving is quite a significant omission. The Government are not short on ambition for this legislation. Greg Barker stated that they want to retrofit 14 million homes by 2020. Chris Huhne described the Green Deal as: "““A once-and-for-all refit that will make every home in Britain ready for a low-carbon future””." He added: "““No more half-measures going off at half-cock””." Those are his words, not mine. I have been through a number of ministerial speeches, comments and press releases—as the Minister knows, I look at the DECC website every day—but I cannot find anything about what energy carbon savings the Green Deal is anticipated to deliver even if the take-up is high, as the Government anticipate that it will be. So the Secretary of State has not stated what the carbon reductions from the housing sector need to be or what the standard of an individual home must be in order to contribute to the carbon reduction. So, defining the energy saving to be achieved to meet the reduction will provide more clarity on what will then need to be delivered in terms of improvement to properties. Perhaps I may also address the fairness issue which the Government raised as an objective in the impact assessment. The principal purpose of these provisions should be in line with the statutory target date for elimination of fuel poverty as provided for by the provisions of the Warm Homes and Energy Conservation Act 2000. Aspects of the Green Deal programme—the energy company obligation in chapter 4—are partially aimed at assisting the most vulnerable. During the course of debates and deliberations on this Bill, the Government will need to decide whether the most vulnerable can be assisted early on in the new deal. The intention of subsection (2) of the proposed new clause is to ensure that the Secretary of State and anybody he empowers to carry out anything under Part 1 of the Bill—the Green Deal providers, the energy companies, et cetera—will have to have regard to what will be delivered and provided towards the principal purposes outlined. I turn to the new clause proposed in Amendment 1A, which deals with the Secretary of State’s duty to improve energy efficiency. By 2020 we should reduce carbon emissions from the housing stock by at least 42 per cent in line with the intended carbon budget proposed by the Committee on Climate Change. As I am sure we will repeat often during the course of this Committee, the Secretary of State has said that this Green Deal, "““is going to be a revolution … the most ambitious energy-saving plan ever put forward””." Yet there is not really a plan. There is, however, an intention, and I think there are some good words around the ambition which are welcome. We will do our bit to work with the Government to ensure that we can realise that intention and that ambition. That intention and that ambition, however, is not a substitute for a clearly defined plan that is on paper, that is published and that outlines a policy measure to be introduced. So, publishing a plan that defines that ambition could make real sense. It also gives to business and those seeking to introduce and deliver the Green Deal the certainty that they need to get themselves geared up and ready. I am sure that the Minister has seen the statement from a number of businesses and NGOs, from the Federation of Master Builders, the World Wide Fund for Nature, Marks & Spencer, B&Q and the UK Green Building Council, which all welcomed the Green Deal but emphasise the need for certainty and ambition. It is in seeking to provide that certainty that we put forward this amendment today. The plan has to include a clearly stated level of energy savings to be achieved in each carbon budget period and the level of carbon budget reduction to be achieved. The complementary policies, such as the financial incentives and the means of ensuring that the cost of capital is kept low, will be key in this. How the Government expect it to be delivered and achieved will be outlined in the plan. At present the Government have not outlined how they intend to report on the progress on what has been achieved as we move forward on the Green Deal. The plan can outline the frequency and measures that the Government will introduce to monitor progress towards achieving the plan and carbon reduction targets. This will outline the impact indicators that the Government will introduce. The plan will also have to take into account other plans because the UK energy system is UK-wide. Demand reduction in one part of the system will impact on another. The Government should ensure that the plan takes into account and has regard to what the Scottish Government intend to deliver in energy saving and what the Welsh Ministers intend to introduce as part of their contribution to meeting the carbon reduction targets under the Climate Change Act. There should also be included a means of review. The Green Deal policy will not just exist for a few years. It will be with us until 2030, over several Parliaments and several carbon budget periods. The recommendations of the Committee on Climate Change will change and develop over time. The Government need to have regard to that advice and any increase on the carbon budget targets that will impact on the level of energy saving that will need to be achieved under this programme. I move on to Clause 4, on the annual report on progress. As it says on the tin, the provisions in this section in the new clause seek to integrate the reporting on progress under this plan with those reports already published under the provisions of the Sustainable Energy Act 2003. This will integrate reporting on the progress achieved on energy savings through the energy efficiency provisions in this Act with other sustainable energy reporting requirements. That does not preclude the Secretary of State from defining further reporting requirements in the plan that he is required to produce under Section 2. I believe that the Government are serious in their intent for the Green Deal. However, this intent to achieve carbon reductions needs to be made clear. It needs to be an explicit and real commitment and not just a target or an aspiration. I hope the Minister feels able to support these amendments. I look forward to his support and comments.