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There are people who are saying that the way to bring down bills is to reach agreement with the oil and gas companies to charge less for gas in the North sea. Is not the problem with that argument that there is absolutely no way that those privately owned companies will agree—or that their shareholders will allow them to agree, to be more accurate—to a lower price than they can get elsewhere in the world?
There are people who are saying that the way to bring down bills is to reach agreement with the oil and gas companies to charge less for gas in the North sea. Is not the problem with that argument that there is absolutely no way that those privately owned companies will agree—or that their shareholders will allow them to agree, to be more accurate—to a lower price than they can get elsewhere in the world?
My hon. Friend makes the really important, and relatively basic, point that gas is priced and sold on the international market. Whether it comes from the North sea or is imported, it is charged at the same price. And do not just take my word for it; when the shadow Energy Secretary was in post she said that more drilling would not necessarily lead to lower energy bills.
The costs of new infrastructure are a pressure on bills, as the Secretary of State knows. He deserves enormous credit for the results of the allocation round 7 auction today, in which the strike price of renewables was less than half what it would have been with new gas. What is the approach to rolling out extra grid—and, indeed, maintaining the existing grid—which is so crucial to the plans, given that there is so much to make up for following the failure to invest over the many years since privatisation?
The costs of new infrastructure are a pressure on bills, as the Secretary of State knows. He deserves enormous credit for the results of the allocation round 7 auction today, in which the strike price of renewables was less than half what it would have been with new gas. What is the approach to rolling out extra grid—and, indeed, maintaining the existing grid—which is so crucial to the plans, given that there is so much to make up for following the failure to invest over the many years since privatisation?
My hon. Friend is right to draw attention to this morning’s auction, which saw record amounts of solar power. It is the cheapest form of power that we could possibly have in this country, and it costs less than half the price of building and operating new gas. On the point about infrastructure, he is right that we inherited a terrible legacy, and we are building the new infrastructure that we need.
Statement on the publication of the fifth report of the Energy Security and Net Zero Committee, Tackling the cost of the energy crisis (HC 736).
Statement on the publication of the fifth report of the Energy Security and Net Zero Committee, Tackling the cost of the energy crisis (HC 736).
What steps his Department is taking to support businesses with energy costs.
What steps his Department is taking to support businesses with energy costs.
My hon. Friend, through his chairmanship of the Energy Security and Net Zero Committee, is working very hard to highlight the issues of business competitiveness and energy costs to businesses. I would draw his attention to the British industrial competitiveness scheme consultation, which I launched a couple of weeks ago, which is our commitment through the industrial strategy to reduce energy costs for over 7,000 manufacturing businesses by around £40 per megawatt-hour from 2027. I encourage all Members to ensure that manufacturing businesses in their constituencies respond to that consultation.
Reducing costs by £40 per megawatt-hour for 7,000 manufacturing businesses is welcome, as is the news in the Budget of changes to the British industry supercharger scheme. However, there are tens—if not hundreds—of thousands of other manufacturing businesses facing some of the highest electricity prices in Europe, which has been the case for many years. What is the plan to help the businesses facing very high bills right now while we wait for lower electricity bills in the longer term through Government plans for clean power?
Reducing costs by £40 per megawatt-hour for 7,000 manufacturing businesses is welcome, as is the news in the Budget of changes to the British industry supercharger scheme. However, there are tens—if not hundreds—of thousands of other manufacturing businesses facing some of the highest electricity prices in Europe, which has been the case for many years. What is the plan to help the businesses facing very high bills right now while we wait for lower electricity bills in the longer term through Government plans for clean power?
My hon. Friend is right. Alongside the British industrial competitiveness scheme, we have also committed to increasing network charges compensation from 60% to 90% under the network charging compensation scheme. We are also reviewing our energy intensive industries compensation scheme. He is right to recognise the lack of competitiveness on energy prices between the UK and the rest of Europe—a terrible situation that was bequeathed to us by the previous Conservative Government and their ideological adherence to relying on foreign dictators such as Putin for Britain’s energy needs. We are investing in our future energy needs to ensure that they are clean, cheap and secure.
To ask the Secretary of State for Energy Security and Net Zero, what the average price for fuel was at (a) motorway stations and (b) other petrol and diesel stations in the latest period for which data is available.
To ask the Secretary of State for Energy Security and Net Zero, what the average price for fuel was at (a) motorway stations and (b) other petrol and diesel stations in the latest period for which data is available.
The Department publishes average fuel prices for the UK weekly, but the data is not collected at the granularity to determine prices for motorways compared to all other stations.
The Competition and Market Authority’s (CMA) road fuel market study found drivers without access to fuel cards are paying more at motorway service stations than elsewhere. This is due to limited competitive pressures and limited opportunities for customers to observe prices and shop around. Differences in ‘fixed’ and ‘variable’ costs, such as rent, staff wages and fuel volume sold also cause price variations.
To ask the Secretary of State for Energy Security and Net Zero, if she will make an estimate of the trend in the level of average fuel prices in the period between 25 October 2023 and 22 November 2023.
To ask the Secretary of State for Energy Security and Net Zero, if she will make an estimate of the trend in the level of average fuel prices in the period between 25 October 2023 and 22 November 2023.
The Department publishes average fuel prices for the UK on a weekly basis. The average road fuel prices on 20 November in the UK were 150.5 pence per litre for petrol and 158.4 pence per litre for diesel. Both have decreased week-on-week, by -0.6 percent and –0.7 percent respectively) over the past month.
To ask the Secretary of State for Energy Security and Net Zero, whether she has had recent discussions with fuel retailers on the level of fuel prices on motorways.
To ask the Secretary of State for Energy Security and Net Zero, whether she has had recent discussions with fuel retailers on the level of fuel prices on motorways.
I refer the hon Member to the answer I gave to him on 18 September to Question UIN 199075.
To ask the Secretary of State for Energy Security and Net Zero, if she will make an assessment of the implications for her policies of the difference between fuel prices (a) on and (b) not on motorways.
To ask the Secretary of State for Energy Security and Net Zero, if she will make an assessment of the implications for her policies of the difference between fuel prices (a) on and (b) not on motorways.
I refer the hon Member to the answer I gave to him on 18 September to Question UIN 199076.
To ask the Secretary of State for Energy Security and Net Zero, what discussions she has had with fuel retailers on fuel prices within motorway service stations.
To ask the Secretary of State for Energy Security and Net Zero, what discussions she has had with fuel retailers on fuel prices within motorway service stations.
The former Secretary of State met with fuel retailers in July 2023 to discuss the Competition and Market Authority’s (CMA) market study findings and strongly encourage their participation in the CMA implemented voluntary scheme, in place until the government can place the open data scheme on a statutory footing.
The Government is aware customers often pay more at motorway fuel stations than elsewhere. The Government has accepted the CMA recommendation to create a statutory open data scheme and monitoring function, that together will facilitate greater competition and put downward pressure on road fuel prices.
The Government will consult this autumn.
To ask the Secretary of State for Energy Security and Net Zero, whether he has made a comparative assessment of the cost difference between fuel sold by petrol stations on motorway service stations and other petrol stations.
To ask the Secretary of State for Energy Security and Net Zero, whether he has made a comparative assessment of the cost difference between fuel sold by petrol stations on motorway service stations and other petrol stations.
The Competition and Market Authority’s (CMA) final report found drivers without access to fuel cards are paying more at motorway service stations than elsewhere. This is due to limited competitive pressure and opportunities for customers to observe prices and shop around. Differences in ‘fixed’ and ‘variable’ costs, such as rent, staff wages and fuel volume sold also cause price variations.
The Government accepted the CMA’s recommendation to create an open data scheme and monitoring function for road fuel prices and will consult this autumn. These recommendations should facilitate greater competition in the UK market and put downward pressure on prices.
To ask the Secretary of State for Business and Trade, what assessment she has made of the potential effect on industry of delaying the British Industry Supercharger scheme.
To ask the Secretary of State for Business and Trade, what assessment she has made of the potential effect on industry of delaying the British Industry Supercharger scheme.
Since the British Industry Supercharger was announced in February, the government is working to deliver it without delay. A consultation on the Capacity Market exemption concluded on 29 June and a response will be issued in due course, whilst the Network Charging Compensation Scheme is subject to ongoing consultation through to 24 August 2023. It continues to be our expectation that all the measures comprising the Supercharger package be rolled out sequentially between April 2024 and April 2025.
To ask the Secretary of State for Energy Security and Net Zero, what steps he is taking to help the steel industry access competitive wholesale electricity prices.
To ask the Secretary of State for Energy Security and Net Zero, what steps he is taking to help the steel industry access competitive wholesale electricity prices.
Powering Up Britain – Energy Security Plan sets out the steps the Government is taking to ensure the UK is more energy independent, secure and resilient as well as our goal for Britain to have among the cheapest wholesale electricity prices in Europe by 2035.
The Government has also announced new measures to support Britain’s Energy Intensive Industries (EIIs) faced with high electricity prices. The British Industry Supercharger will reduce policy costs by exempting eligible firms from the costs of renewable energy obligations and the GB Capacity Market. It will offer support with network charges and bring an increase in the capacity market exemption, for which we have just carried out a public consultation. This is in addition to other ongoing support providing compensation for the indirect costs of the UK Emissions Trading Scheme and the Carbon Price Support mechanism.
To ask the Secretary of State for Business and Trade, what assessment she has made of the impact of electricity prices on (a) steel producers and (b) the steel industry.
To ask the Secretary of State for Business and Trade, what assessment she has made of the impact of electricity prices on (a) steel producers and (b) the steel industry.
Ofgem has previously carried out research on what drives comparatively high GB electricity prices for energy intensive industries (EIIs) and has compared these with selected European countries. Ofgem published a report in 2021 which can be found here: https://www.ofgem.gov.uk/publications/research-gb-electricity-prices-energy-intensive-industries(opens in a new tab).
The Government recognises that EIIs, including steel producers, are feeling the impact of high energy prices. The 2022 British Energy Security Strategy announced that the EII Compensation Scheme would be extended for a further 3 years.
In February, we announced the British Industry Supercharger: a decisive set of measures aimed at reducing electricity costs for EIIs to bring them in line with those charged across the world’s major economies.
We have already provided extensive energy costs relief to the steel sector since 2013, including through the Energy Bills Relief Scheme. Steel producers will continue to receive support until 31 March 2024 through the Energy Bills Discount Scheme.
To ask the Secretary of State for Business and Trade, whether she plans to implement all the measures set out under the British Industry Supercharger scheme before April 2024.
To ask the Secretary of State for Business and Trade, whether she plans to implement all the measures set out under the British Industry Supercharger scheme before April 2024.
The delivery mechanisms for implementation of the British Industry Supercharger are subject to ongoing consultation, with an expectation that they be rolled out sequentially between April 2024 and April 2025.
To ask the Secretary of State for Business and Trade, if he will make an assessment of the potential impact of industrial energy prices in (a) Germany and (b) France on the UK steel industry.
To ask the Secretary of State for Business and Trade, if he will make an assessment of the potential impact of industrial energy prices in (a) Germany and (b) France on the UK steel industry.
Ofgem has previously carried out research on what drives comparatively high GB electricity prices for energy intensive industries (EIIs) and has compared these with selected European countries. Ofgem published a report in 2021 which can be found here: https://www.ofgem.gov.uk/publications/research-gb-electricity-prices-energy-intensive-industries(opens in a new tab).
The Government recognises that EIIs, including steel producers, are feeling the impact of high energy prices. The 2022 British Energy Security Strategy announced that the EII Compensation Scheme would be extended for a further 3 years.
In February, we announced the British Industry Supercharger: a decisive set of measures aimed at reducing electricity costs for EIIs to bring them in line with those charged across the world’s major economies.
We have already provided extensive energy costs relief to the steel sector since 2013, including through the Energy Bills Relief Scheme. Steel producers will continue to receive support until 31 March 2024 through the Energy Bills Discount Scheme.
To ask the Secretary of State for Energy Security and Net Zero, what assessment he has made of the potential merits of a national retrofit strategy on the Government's ability to (a) reduce energy bills and carbon emissions and (b) increase private investment.
To ask the Secretary of State for Energy Security and Net Zero, what assessment he has made of the potential merits of a national retrofit strategy on the Government's ability to (a) reduce energy bills and carbon emissions and (b) increase private investment.
The Heat and Building Strategy sets out the actions the Government is taking to reduce carbon emissions from buildings in the near term and provides a long-term framework to enable industry investment and deliver the transition to low-carbon heating.
The Government has also established the Energy Efficiency Taskforce, which aims to reduce the UK’s final energy consumption from buildings and industry by 15% by 2030 against 2021 levels. The Taskforce will deliver this by stimulating private investment and increasing green finance options, galvanising supply chains and increasing public and business engagement with energy efficiency. £6 billion of government funding will be available from 2025 to support this objective, in addition to the £6.6 billion allocated in this Parliament.
To ask the Secretary of State for Energy Security and Net Zero, whether he plans to decouple electricity and gas prices.
To ask the Secretary of State for Energy Security and Net Zero, whether he plans to decouple electricity and gas prices.
As part of the Review of Electricity Market Arrangements (REMA) programme, the Government is considering a range of potential options to shield consumers from the
impacts of potential future commodity price spikes and to ensure they benefit from lower cost renewables.
The CfD scheme already insulates consumers against electricity price spikes. Over time this scheme will significantly reduce dependence on fossil fuelled power generation, lowering consumer exposure to gas prices.
To ask the Secretary of State for Business and Trade, what steps her Department is planning to introduce by the end of the Parliament to reduce industrial electricity prices.
To ask the Secretary of State for Business and Trade, what steps her Department is planning to introduce by the end of the Parliament to reduce industrial electricity prices.
The government has announced new measures to support Britain’s strategic Energy Intensive Industries (EIIs) with high electricity prices. The British Industry Supercharger aims to remove policy costs to reduce the long-term industrial electricity price gap between the UK and competitor countries. Proposals will exempt firms from costs arising from renewable energy obligations and GB Capacity Market costs. It will also offer support with network charges, for which an amendment has been introduced to the Energy Bill. We will consult on the capacity market exemption shortly and intend to bring forward secondary legislation on all three measures within this Parliament.
To ask the Secretary of State for Energy Security and Net Zero, whether he plans to have discussions with Ofgem on improving transparency in Economy 7 tariffs under the Price Cap by requiring suppliers to publish Economy 7 tariff price schedules.
To ask the Secretary of State for Energy Security and Net Zero, whether he plans to have discussions with Ofgem on improving transparency in Economy 7 tariffs under the Price Cap by requiring suppliers to publish Economy 7 tariff price schedules.
A decision on whether to require suppliers to publish Economy 7 tariff price schedules is a matter for the independent regulator Ofgem.
Ofgem’s Licence Conditions require suppliers to notify customers of the domestic supply contract terms, including requiring suppliers to take all reasonable steps to inform customers of the principal terms of their supply contracts, and sending a notice if prices increase or the terms of the contract vary in a way that disadvantages the customer.