Oral Question: Topical - Cost of Renewables

- Thursday, 19th March 2015

 

Coin Towers

Chris Evans (Islwyn) (Lab/Co-op): Over the last five years, one of the biggest problems, particularly for elderly constituents of mine, has been complicated, high-tariff energy bills. On 17 occasions, the Prime Minister has said he would force energy companies by law to put their customers on the lowest energy tariff, but three out of four households are still on energy tariffs that cost on average £180 more than the lowest one. What are the Government going to do about that?

 

Mr Davey: We inherited an energy market that was completely broken and a situation where energy bills were complicated and opaque, but we and the independent energy regulator, Ofgem, have acted. We now have simpler bills, fewer tariffs and increased levels of switching, which is helping huge numbers of people. On the specific point the hon. Gentleman raises, Ofgem, in its retail market review, proposed the policy he refers to and is making sure it goes through, but if he has examples suggesting that any suppliers are not delivering on that new regulation, he should bring them to the independent regulator’s attention.

 

Mr Peter Lilley (Hitchin and Harpenden) (Con): Does my right hon. Friend agree that the single biggest boost to the British and world economy has been the halving of the oil price, and does it not follow that forcing British industry to use energy that costs twice as much as conventional energy will have a depressive effect on the British economy? Why oh why is he insisting on our moving to wind, which costs twice as much, and this Swansea tidal power, which, according to the Financial Times, will involve a price three times that of conventional fuels for 35 years? Is that not going to depress the British and Welsh economies?

 

Mr Davey: I have a lot of respect for the right hon. Gentleman, who is known for his intellectual abilities and knowledge, but I am afraid that on this occasion they have failed him, and for this reason: we do not use oil to produce electricity—we haven’t for a long time. His point relates to transport. Oil is a substitute for transport fuels. I think he is talking about gas, but the price of gas has not come down by very much. Moreover, the fall in the price of gas was taken account of in the way we produced the levy control framework, which is the support for low-carbon electricity.

 

 

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