Energy commission idea rejected

No new advice body needed to guide policy, decides Lords debate

The government has rejected a proposal to set up a powerful new independent commission to advise on energy policy.

The House of Lords economic affairs committee recommended in a recent report that a new commission should be set up to advise on the best way for delivering energy policy.

Under the peers’ proposal, the new body would manage the electricity generation auctions, which it said should not favour one technology over another.

The committee’s chair Lord Hollick, opened a debate on the report in the House of Lords this week and said that the commission would provide “welcome continuity” in a department which had seen five different energy ministers in the past five years.

The proposed commission would work alongside the climate change committee, he explained.

However, responding to the debate, higher education minister Lord Younger rejected the proposed commission.

He said: “We are not convinced that a new energy commission is necessary to provide further advice.”

Lord Younger also rejected the committee’s recommendation that generation auctions should be run on a technology-neutral basis. While he said he understood the benefits of such a move, he argued that it would result in a “big upheaval” for investors and the energy industry.

In addition, the minister said that the government would publish its latest estimates of the impacts of energy policies on domestic bills in the “near future”. And he said the government would “fine tune” its approach to encouraging supplier switching in the energy retail market.

Other comments made during the debate came from the economic affairs committee’s incoming chair Lord Forsyth, who said that the uncertainties surrounding the Hinkley C nuclear power station project meant that it was “a severe risk to security of supply”.

The former Tory Scottish secretary of state added that the government needed to take a wider-angled approach to electricity costs rather than prioritising climate change objectives.

He said: “It is surely possible to take account of the fact that if the economy has turned down or if new batteries or other kinds of technology are available in future, they might take a view which will lessen the pressure on consumers. Consumers are finding things getting pretty tight.

“If there is pay restraint in the public sector and the end of the business cycle, it could only help if government were to look at the cost of electricity in the context of their other objectives.