Baroness Curran (Lab)

My Lords, I thank the noble Lord for that contribution, and on that very note I welcome his remarks. We debated some of these issues on my very first outing at the Dispatch Box on the Floor of the House, and I think we will debate some of the fundamental points that he made about the direction of energy policy. He is right to contextualise this within that wider debate about energy policy. It is perhaps one of the great debates of our time and will dominate our thinking and discussions in the time ahead. I am tempted to go into a very long discussion about that; I am sure we will have lively debates going forward. He will know, as I said on the Floor of the House, that the Onward report faced some criticism and there were some arguments from the sector about the report’s premises, but I will leave that because I am sure that we will return to it. At the end of my contribution today, I will comment on the general policy of our approach. I will now address the boiler upgrade scheme. I put on record that I recognise and respect the noble Lord’s detailed points about it and will pay great attention to the arguments that he is putting forward. It is an argument that this Government want to win, and we believe we can win it, but we will do that only by paying attention to the substance of what he said—and I recognise that substance. I will go through the points that he raised. I will not repeat that the boiler upgrade scheme remains the Government’s flagship scheme for supporting the decarbonisation of heat in homes and small non-domestic buildings across England and Wales, because we see decarbonisation as fundamental to the challenges facing the country and as offering solutions to some of the great issues around climate change and its consequences. I will return to that. I shall focus on the points raised by the noble Lord and the detail of what he said. He acknowledged that the boiler upgrade scheme is directly funded by the Exchequer. It does not put any direct costs on consumers’ bills. Furthermore, our scheme evaluation data shows that people who have received grants from the boiler upgrade scheme most commonly find that their energy bills decrease as a result. Some 50% of boiler upgrade scheme grant recipients reported that their total energy bills decreased when replacing a gas boiler with a heat pump, compared with just 15% who reported an increase. As he acknowledged, eligible low-carbon heating installations currently benefit from 0% VAT, which further reduces costs for consumers.