The government’s flagship energy bill will come before the House of Lords for a series of potential amendments on Monday that campaigners say could help protect the poorest households from the worst of soaring energy bills.
The bill is to enter its committee stage, at which influential peers are expected to advocate crucial changes to the legislation that if accepted could help to reduce costs for consumers.
Measures are needed to insulate more homes, boost renewable energy generation and help the most vulnerable heat their homes, according to a coalition of charities and civil society groups.
However, some of the key measures are likely to be blocked by the government. The outcome of the leadership vote among Conservative party members will be announced on Monday afternoon, and the new prime minister – either Liz Truss, the favourite to win, or former chancellor of the exchequer Rishi Sunak – will take office on Tuesday.
Parliament returns on Monday after the summer recess to face a growing crisis over the cost of living. The price cap on energy bills for average households will rise to £3,549 from October. Academics have warned that by January, two-thirds of households could be in fuel poverty and millions of people on lower incomes may have to choose between heating and eating this winter.
But Truss has set firm against some of the key measures that experts said would alleviate hardship among poorer households. She firmly opposes any extension of the windfall tax on energy producers, even though oil and gas companies have reaped an unprecedented bonanza this year, owing to the impact of Vladimir Putin’s invasion of Ukraine rather than any investment or productivity improvements on their part.
Russia has now switched off the Nord Stream 1 gas pipeline to Europe, as G7 countries pledged to cap the price they are prepared to pay Russia for energy, putting further pressure on energy supplies.
Truss said little during the leadership campaign on insulation, and vowed to avoid any form of energy rationing, even though experts have warned it is likely to be needed as Britain faces the possibility of acute energy shortages this winter and small companies are going out of business under the impact of soaring bills. Her likely choice of business secretary, Jacob Rees-Mogg, is also broadly against government intervention in the markets.
Truss has pledged instead to push forward with the licensing of new oil and gas fields in the North Sea, and supports fracking, even though these will take years or decades to produce any new fossil fuel. She is against onshore wind farms and solar farms, even though these can produce energy quickly and at a lower cost than gas.
Squeezing more from existing gas fields in the North Sea, as Truss wants to do, is also unlikely to help UK consumers, as gas is traded on international markets so any extra production can be sold to the highest bidder abroad, increasing oil company profits but doing little for bills, experts have warned.
The UK has been hit harder by the global energy crisis than other western European countries because of our dependency on gas and failure over decades to improve home insulation, according to recent studies.
As peers prepare to start their committee stage scrutiny of the energy bill, the Warm This Winter campaign has sent them all, and all MPs, a briefing document showing that direct financial help to low-income households, a national rollout of home insulation and a tripling of renewable energy generation are all feasible and could help to alleviate hardship this winter and reduce the UK’s expensive dependency on gas.
Simon Francis, of the End Fuel Poverty Coalition, one of the Warm this Winter members, said: “This summer, MPs will have seen first-hand the anxiety and desperation their constituents are experiencing and will be wanting to do everything they can to help. That means more emergency money for people this winter, funding to help everyone cut their bills with better insulation, and a rapid move away from expensive gas and on to cheaper, renewable energy.
“We urge MPs to back these calls for genuine solutions to help people this winter and in future, and to ignore the special pleading of the oil and gas industry. The seriousness of this crisis demands that they back measures that will tangibly make a difference to people’s lives.”
Tessa Khan, the director of the Uplift group, which campaigns against exploitation of North Sea fossil fuels and is also part of the Warm this Winter coalition, said: “In every constituency across the country, households and businesses are looking at their energy bills with dread, knowing that they cannot fix this on their own.
“Finally, MPs now have an opportunity to push for measures that will help people this winter and make sure the country is in a better position in winters to come. Even if it were possible, more domestic gas won’t lower bills. All it will do is increase industry profits and lock us into an unaffordable energy source for longer than necessary.”
A government spokesperson said: “We know people are incredibly worried about rising energy bills, which is why one in four of all UK households will see £1,200 extra support, provided in instalments across the year, and most people will receive a £400 discount on their energy bills over winter.
“We’re also investing £6.6 billion in total this parliament to improve energy efficiency across the country, benefiting tens of thousands of homes and delivering average savings of £300 a year on energy bills.”
