Electricity and Gas (Community Energy Saving Programme) Order 2009

My Lords, of course I have confidence in the work that is undertaken to give noble Lords and Members in another place as clear an indication as we can as to the likely cost. No doubt this House will finally have been reformed by 2020, but if we are still here then we might be able to debate the question of whether I got that figure right or not. It is the best estimate that we have, and we expect that, for the next four or five years, the increase will be minimal. The cost will rise in the latter part of the next decade. I know that there is a disagreement about these costs, and I suspect that the costs to which the noble Lord refers probably do not take account of the potential impact of energy-saving measures. It could be that that is the reason for that discrepancy. I will be happy to discuss this with him to see if we can at least reach agreement on the methodology, as this is a very important matter. I fully understand the point that the noble Lord, Lord Reay, makes about energy bills showing what households are paying towards energy efficiency schemes. He may recall that we debated this very fully last autumn, although I forget whether we were debating the Energy Bill or the Climate Change Bill. We continue to explore with suppliers the best way to strengthen consumers’ awareness of these issues. I have no disagreement with him in terms of the principle. The Government have made it quite explicit today that there will be a cost issue for consumers, and although noble Lords disagree about the figure, I hope they will agree that it is very good to have this in the public domain. I agree with the noble Lord that it is very important that this is understood. It is why, incidentally, we are very keen about home energy advice. I noted the concerns and questions that the noble Lord, Lord Patten, and the noble Baroness, Lady Wilcox, raised. We see this is as one of a range of energy efficiency measures that suppliers can promote. Suppliers have discretion about how they market, and costs will fall to suppliers, although we have already accepted that this can be passed on in customers’ bills. It is the same point about transparency. The more information we can give the consumer, the better. That is why it is important that we have introduced behavioural measures through the scheme. This is also a very good introduction to smart meters. A number of noble Lords are passionate about the impact that smart meters can have. I accept that advice standards need to be of a high quality. My understanding is that only qualified personnel will be allowed to give advice, that Ofgem will require that all advisers have had a CRB check and character references, that suppliers must also provide advice on a specific set of behavioural issues, and these behaviours will obviously come within the kind of framework of regulation which I have suggested. I accept that there must be integrity in this process. I refer to the question of rurality. In the consultation we received many conflicting views about how the programme should be targeted. We consulted on the basis that CESP should use the lower income domain of the indices of multiple deprivation to target activity. These areas are in the lowest 10 per cent of income deprivation in England, and the lowest 15 per cent in Scotland and Wales. This will cover more than 2.5 million households in around 4,500 defined areas. The majority of responders agreed that the indices represented transparent objectives and a simple approach. There were some concerns that this would limit the number of rural areas, but no alternative methodology was proposed that was not excessively complicated. However, if CESP is to have its maximum value, it is important that it should foster a reasonable spread of different types of project in different types of location. The Government therefore expect obligated companies seriously to consider targeting action at a variety of areas around the country, including rural areas. We will facilitate contacts where this would be helpful. We will monitor and evaluate all schemes to ensure that any lessons relevant to rural delivery are considered in future policy development. I say to the noble Lord, Lord Teverson, that I thought my strike rate in answering his questions was rather better than that, and I am rather concerned.