11:00 Matthew Pennycook (Labour)

Of course, that is welcome, but it provides little comfort to heat network customers who are not getting a fair deal and for whom every month that passes without effective protections being put in place means continued poor service and expensive bills. That should concern us all deeply, and I know it concerns the Minister, not only because of the Government’s avowed aim to keep customer bills as low as possible, but because of the possibility of the widespread loss of consumer confidence in heat networks, which would make it harder for the UK to decarbonise heat and reduce overall greenhouse gas emissions.

As the Minister is aware, if the UK is to meet its future emissions reduction targets, we have to do more to decarbonise heat. The Committee on Climate Change estimates that about 18% of UK heat will need to come from heat networks by 2050 if the UK is to meet those targets cost-effectively. From a consumer protection and an environmental perspective, we cannot allow the benefits of heat networks to be tainted as a result of our failure to address promptly the flaws in the sector before it grows significantly over the next decade.

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11:13 The Minister for Energy and Clean Growth (Claire Perry)

It is a pleasure to serve under your chairmanship, Mr Davies, in particular as you have a long-standing interest in the whole area of decarbonisation.

To set the scene for why this is an important debate for the hon. Gentleman’s constituents and more generally, we believe that heat networks have an important part to play in the decarbonisation of the heat system in future. About half a million customers are part of a heat network, with about 14,000 individual schemes throughout the UK. As he has pointed out, however, there have been ongoing concerns about treatment of consumers and effective regulation of a small monopoly provider. That is why the CMA produced a report, to which we responded.

As I said at the beginning of my speech, that is not just because we want to ensure that consumers have adequate redress, particularly if they are on low-performing networks, but because there are huge potential benefits, both for customers and for decarbonisation. Heat accounts for about one third of the UK’s carbon emissions. We have to cut emissions from heat. We have had various other schemes, such as the renewable heat incentive and the energy company obligation. In February, I opened the heat networks investment project, which will see up to £320 million of capital funding invested in heat network projects through grants and loans across England and Wales.

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