RT HON HILARY BENN MP, MS SUSANNA MAY AND MR PAUL CHAMBERS

20 FEBRUARY 2008

  Q60  Lynne Jones: I am told that one of the major problems is that the 2,500 cap is too low. I have even heard that officials have advised on that, that it should be at least 5,000. If you really want to get these installations done should you not be doing something to look at that rather rapidly so that you can get this programme back on course?

  Hilary Benn: Yes, we will look at it.

  Q61  Dr Strang: Given what you said about the Low Carbon Buildings Programme, and I think we would all agree there is slow progress in this country on micro-generation, are you satisfied that once we get to 2009 we will be able to move forward on micro-generation? How do you see that and whether this money will be spent?

  Hilary Benn: I think the decision to look at the contribution that feed-in tariffs can make is, in my view, very significant because look at the evidence from other parts of the world. If you can set up an incentive structure with a degree of certainty about what you are going to get back for what you invest then it seems to me you open up the market, you bring the investment in, you bring it forward in a way from other sources and not from the Government saying, "We have to put more and more money into these kinds of projects". You are achieving the same objective but by a different way. Part of the reason for saying we will look at feed-in tariffs is both because of the experience of elsewhere but also because in the light of the EU package we are going to have to do a darned lot more.

  Chairman: Secretary of State, the Committee will drop you a line in a couple of months to see how all this looking is progressing. We are looking forward to a reply.

  Q62  Mr Drew: If we can look at the actual mechanism for trying to get this progressed, which is obviously the CERT scheme, the Carbon Emissions Reduction Target, there are four key criticisms, and this is not just CERT but what lived before CERT, the various energy efficiency commitments. The first is that it is still quite a bureaucratic scheme even though CERT is better than what went before. Secondly, there are relatively high marketing costs to try and identify what is an appropriate set of properties to apply. Thirdly, it is target driven and targets can result in feast and famine, sometimes there is money and sometimes there is no, so that can skew the targets and that has an impact on the need to try and encourage areas to lead to various forms of better energy efficiency. Lastly, the issue which has already been touched on that in effect the consumers are paying for this and yet it is not necessarily transparent to consumers that their commitment is yielding much benefit for them. I know that is a complicated rationale but this, as the Chairman has said, is quite a complicated area. How would you respond to those criticisms?

  Hilary Benn: With respect, I am not sure I would agree that it is bureaucratic. On the marketing costs, energy suppliers are pretty creative, I have to say, in my experience in the ways in which they try to identify suitable customers to assist, and you can look at the different forms that marketing takes. It absolutely is target driven, and I make no apology for that, that is the purpose of it. Yes, of course in the end consumers end up paying, but consumers pay for feed-in tariffs, consumers pay for lots of things. Ultimately, all of these things do have to be paid for but the benefit in terms of overall reduced energy consumption as a result of the work having been done and the reduction in carbon emissions is tangible and real.

  Q63  Mr Drew: Just to finish on this area, how would you measure the effectiveness of Government in relation to the companies? Effectively you work in partnership but there is an awful lot of exhortation rather than stick involved in this. What is to say that this will really begin to revolutionise the way in which households do see their responsibility to reduce their energy use and to do much more to make sure their properties are as energy efficient as they possibly could be?

  Hilary Benn: In terms of investment, EEC Phase 1 suppliers put in £400 million, Phase 2 £1.2 billion, CERT will be £2.8 billion, so you can see a very considerable increase there. EEC Phase 1 600,000 cavity walls insulated, Phase 2 1.2 million, under CERT Phase 3 estimate 2.8 million. It is a tangible benefit. There is no doubt that if you asked members of the public, "Do you know about EEC or CERT's existence? Do you think the Government has got anything to do with it?" I suspect probably very few people would know that the offer of the free light bulbs or we will come and do your cavity wall or the loft, or money off your fridge if you buy an energy efficient model, is as a result of Government placing the obligation on the energy supply companies and people would know that is the mechanism. I think that is a fair point, and it goes right back to your original question, Chairman, which was how do you pull all of these things together in terms of telling the story of what it is that we as a society, and Government playing its part, are doing. Then we come to the question of how you get people to do things to change their behaviour. Giving advice is one and giving free support to improve the energy efficiency of their homes is another, the advertising, the Act on CO₂ campaign, the carbon calculator that three-quarters of a million people have now gone on to. Those are all part of the steps that we are taking to try and engender a sense that this is something we have got to do and each of us has got to play our part.

  Q64  David Taylor: Can we turn to renewable heat. The last time I looked we are closer to the North Pole than about 80 per cent of our fellow residents of the EU and yet the governments that represent that 80 per cent seem to be doing vastly more than we are in terms of encouraging the development of renewable heat. Why are we seen as having such a laggardly and leisurely approach? How can you account for that?

  Hilary Benn: I think it goes back to the point I was making earlier in answer to Lynne Jones' question about renewables generally. I would say for the same reason, so it is historic, but I absolutely get the point about the need for us to do more and that is why the Office of Climate Change did its bit of work on renewable heat and why the Prime Minister in his speech in November said that we will have a Call for Evidence so that we can make progress on this. The truth about heat is for large energy generation if you can find a large potential user then you can make the connection but where it is more difficult, because we do not have that infrastructure, is if you are trying to have district heating schemes, for example, because we have not got many examples of that is the truth.

  Q65  David Taylor: The local authority on whose housing committee I served for some years prior to my time on that council in the 1960s and 1970s had good numbers of local authority estates served by district heating schemes. There is nothing exactly space age about this, is there?

  Hilary Benn: No, and I can think of one estate that was in the ward that I represented as a councillor for 20 years and I remember when it bust. This was just one example, maybe it was the way it was built, but they had so many problems with it that they packed it in and installed individual heating units in each of the flats.

  Q66  David Taylor: But we have moved on. What bright ideas do you and your colleagues have as to how people can be encouraged to use a district heating scheme, for instance, or other forms of renewable heat?

  Hilary Benn: The purpose of the Call for Evidence is precisely to get views and ideas about how we can make further progress on this because I accept the point you make that as a country we have not done very well on it. We get the point, we get the argument, and that is why we are taking the steps that we are.

  Q67  David Taylor: How much confidence do you personally have in the office of Climate Change?

  Hilary Benn: A lot.

  Q68  David Taylor: Do you?

  Hilary Benn: Yes, I do.

  Q69  David Taylor: Would a good performance indicator as to the extent of that confidence be you would not particularly want to revisit and rework things that have already been done by the OCC? They have considered this issue in-depth, why on earth are we going to retrace their steps and their tracks? Is this not a waste of time? Is this a diversion?

  Hilary Benn: A diversion, no. Why would we be interested in a diversion?

  Q70  David Taylor: So why are we consulting again?

  Hilary Benn: Because you have got to turn the ideas that were in the report that they produced into practical action and it seems to me a sensible thing to do and it is absolutely not a diversion.

  Q71  David Taylor: We seem to be replicating some of the things that they have already done, some of the fact-finding, some of the collection of ideas that are already in the public domain. Why are we doing that? Is it a lack of self-confidence?

  Hilary Benn: A what?

  Q72  David Taylor: A lack of self-confidence on the part of Government that it has the necessary analytical talent and resources within its midst?

  Hilary Benn: No, I do not think so.

  Q73  David Taylor: Why does it have to go out to the general public yet again for the second time within a short period?

  Hilary Benn: The OCC did this piece of work internally and produced it, not everybody out there has followed every dot and comma of that, and it seems to me having done that work, and if you look at how lots of policy develops you will find a similar process, is it not very sensible to then say, "Right, folks, what do you think? How are we going to move on this? What kind of renewable obligation would help to take this forward?"

  Q74  Chairman: Secretary of State, you asked Sir Ben Gill to undertake the work and publish a report from the Biomass Task Force and it produced a very comprehensive report, it looked at all of the detail, the technology. I remember we have discussed it on umpteen occasions and there was a tremendous body of knowledge and expertise in that document. It beggars belief that we now almost have to say, "Right, well Sir Ben was asked to do the job, the Biomass Task Force reported, so we are now going back and starting all over again".

  Hilary Benn: I do not quite agree that we are going back and starting all over again.

  Q75  David Taylor: Are we not repeating what in essence the OCC were asked to do? Is this not a classic example of what was once called paralysis by analysis? When are you actually going do something instead of marking time?

  Hilary Benn: I just do not accept, with respect, the premise of the question because we have spent an hour and a bit on a number of things that the Government is getting on and doing.

  Q76  David Taylor: I am talking about renewable heat here. There are a lot of worthwhile advances in other areas and renewable heat has very, very significant potential but we are way behind other rather warmer countries in terms of what we have done within our own sphere of influence and you have given some of the reasons for that, but the time for talking, the time for analysis, the time for reflection, consultation and review passed ages ago. Let us get cracking on it for goodness' sake; we are at five to midnight on these matters.

  Hilary Benn: That is exactly why we are taking forward the work on renewable heat in the way that we are.

  Q77  Miss McIntosh: You said that we do not have that infrastructure but the infrastructure exists. My uncle lives in a house in Denmark that has what they call distance warming and it is true that it can only apply to a new development, but it has been hugely popular with households because you are disposing of waste and it means you are getting heat at a reduced cost. I think most recently there was an example in Immingham. The infrastructure and technology is there, why have we not learned from other European experiences?

  Hilary Benn: What I meant was not that the technology does not exist, I did not mean we have not got the infrastructure in that sense, I meant if you look at the UK we have not got a lot of systems of the type that you have described.

  Q78  Miss McIntosh: But we could have put them in in the same timeframe.

  Hilary Benn: That is a product of our history and decisions that were taken or not taken in the past. I do not know if you want to add something.

  Mr Chambers: All I was going to say is there is a difficult trade-off because where you have existing homes that have high heat load, that is where district heating is—

  Q79  Miss McIntosh: I accept that, Chairman, I am looking at new developments. This was a new development 40 years ago. We have had masses of new developments of the same scale over successive governments, I am not just pointing the finger at one administration. It is tried and tested, it is getting rid of waste and the householders are benefiting from cheap heat.

  Mr Chambers: Homes built to the 2006 Building Regulations and those that have been signalled for 2010, 2013 and beyond have such a small heat load that district heating is extremely difficult to justify for domestic use only. Obviously if you have mixed use developments then it is easier to find a balance of heat loads, but you need hardly any central heating at all for a house built to the standards we propose for 2010, 2013 and 2016, so it will get progressively harder and harder.