My Lords, efficiency has been mentioned rather a lot during the proceedings in this Committee today, and I propose a brief amendment that would improve efficiency and increase the opportunity for all to benefit from the government scheme to introduce renewable heat, which will improve the UK’s most important infrastructure—mentioned earlier by the noble Lord, Lord Whitty—our buildings.
The legislation set out in the Energy Act 2008 does not allow for the assignment of renewable heating incentive payments to a third party as is permitted for feed-in tariffs. Indeed, under current powers, only the
owner of the renewable heating system can receive payments for the scheme. The result is that while those with access to finance can benefit from the government scheme, those without such access will not be so fortunate. Many of them are hard-working rural families who, by living off the gas grid, have higher energy bills and a greater tendency to be fuel poor. My amendment would give the Government options on how to open the scheme most efficiently and effectively to wider funding. It would allow the renewable heat incentive to replicate the successes that have been seen with the Solar PV that has been installed so widely.
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I have also included in this amendment two minor changes to the RHI primary legislation. The aim of both is to make the scheme more efficient and flexible so that the taxpayer and customers get the best value for their money. The first is designed to allow the Government to contest the delivery role for the administration of the RHI. It seems strange to me, when looking at the legislation, that we in Parliament would tie the Government’s hands so that they can only use Ofgem to deliver the scheme. Ofgem may well be the organisation that is best placed to do this and offer the Government the cheapest solution. However, Parliament has, with the current regulations, ensured that we will never know and that genuine accountability for the costs of delivering this scheme for the next 20 years will be the monopoly of a single organisation.
In light of this, I believe it is time for the Government to seek, and for the House to grant them, the power to open delivery of the RHI to competition in order to ensure value for money and the highest possible delivery standards for taxpayers. Secondly, I am suggesting that we streamline the existing regulatory process to allow us to make changes to the existing RHI regulations via negative as opposed to affirmative resolution. The existing legislation states that affirmative resolution must be used to make any changes to the RHI regulations. I understand that, with uncertainty over the delivery and shape of the scheme when it was initially proposed, Parliament originally required a strong say over the development of the programme. That is quite understandable. However, the scheme has now been approved by both this House and the other place, and surely now is the time to revert to a more streamlined process so that we can ensure that this House does not create a bureaucratic paper trail which means that the scheme is unable to respond quickly and effectively to innovations in the market. This change will allow the scheme to stimulate growth by reducing instability and uncertainty for the renewable heat manufacturers and installers and their supply chains, as well as for companies and consumers considering the installation of renewable heat systems.
To illustrate the amount of parliamentary time the scheme has required recently, it was the subject of three debates in both Houses in 2013 and already a further two this year. Although the amendment I have drafted would move all decisions to the negative resolution process, the Government could and should look at the option of some key decisions remaining within the affirmative process, should they accept this amendment. I beg to move.