How can energy policy get the scrutiny it deserves?
End of the Energy and Climate Change Select Committee
There was a sense of inevitability about the announcement that from October 2016 the Energy and Climate Change Select Committee will be no more. In the Committee’s seven year history it has done an excellent of job of examining the deeply complicated and entwined nature of energy policy, which typically lies on the political margins. However, as capacity margins tightened and the UK underwent the greatest reform of the electricity market since privatisation, the committee played a vital role in stress testing policy and providing a platform for industry to inform.
But with the Department of Energy and Climate Change (DECC) being scrapped earlier this year, it seemed the writing was on the wall for its departmental select committee. The Government was quick to allay fears that climate change and energy would drop down the agenda following the dismantling of DECC. However, fewer energy questions during BEIS questions or a specific committee to some may be seen as evidence of those fears coming into fruition.
Due to the miasmic nature of energy policy it needs to be examined holistically in order to join the dots between the complex relationships that exist between generation, demand, efficiency, technology, international targets and consumer behaviour. So where will energy policy get the scrutiny it deserves?
Other Select Committees
Despite the Energy and Climate Change Select Committee being the obvious go-to-committee that does not mean it is a closed shop for energy. Firstly, the new BEIS Select Committee will have an important job examining departmental policy. Industry must do its utmost to identify the areas of energy policy that need acute examination now and for the remainder of this Parliament.
Thinking laterally, the Environmental Audit Select Committee (EAC) remit covers Government policies related to climate change, sustainability, the environment and green taxation. This is incredibly broad and means things like meeting carbon budgets or the Levy Control Framework easily fall under the EAC’s remit. Whilst the committee had in recent years seemed redundant, it may now take on a higher profile. Another benefit of the EAC is that it is not confined to one department. It can examine policy holistically. For example, they can ask Ministers from DfT, HMT, BEIS and Defra to give evidence on how they plan to meet the Fifth Carbon Budget. The EAC has one of the strongest team sheets when it comes to understanding energy policy. Alan Whitehead, Peter Aldous, Zac Goldsmith, Peter Lilley, Rory Stewart and Caroline Lucas all have differing but knowledgeable understandings of energy and environmental policy. So over the coming months don’t be surprised if the EAC grows in stature and potentially beyond its current remit.
Another and maybe less obvious avenue is the Lords Select Committees. Although they are not as high profile or generate the headlines of their counterparts in the Commons, they should not be overlooked. Unlike the Commons where members are first appointed with next to no experience, Lords Select Committees consist of peers who are often appointed due to their extensive experience and knowledge in the field. Therefore providing evidence to a Lords Select Committee tends to be even more daunting prospect as they have the ability for more incisive questions and are not afraid to focus on the detail. Lords Committees have much more free reign and can produce incredibly detailed reports that can often be more future gazing. The Lords Science and Technology report on electricity infrastructure resilience or Lords Economics Affairs current inquiry into the economics of UK energy policy are just two examples of the excellent work conducted by Lords committees.
Outside of Parliament
However, the ability to scrutinise policy is not a monopoly owned by Parliament. Research institutes and think-tanks have always played an important role in dedicating more time and resources to examine policy areas. Longer, thorough and independent research allows time to really get under the skin of a particular issue. Robust findings with extensive research chimes with civil servants as it makes it easier plug that research into their own modelling. Being objective and non-partisan avoids entering the messy political fray too. The key for any future research will be to ensure that it fits into the Government’s future industrial strategy. Therefore an energy policy’s multiplier effect on a region, jobs, growth and skills is just as important as whether it meets government targets. If energy policy is not getting adequate parliamentary scrutiny then reports from Policy Exchange, Oxford Energy Institute or Pöyry could become even more influential in shaping Whitehall thinking on energy. The important next step that comes with independent research is ensuring that the right people actually read it.
Role of industry
Alternatively, the best policies are the ones that have been tested in real life. A common problem is that policies are concocted in the Whitehall laboratory but can struggle in the real world. The Green Deal is good example of this. On paper it was a good idea but in practice the aims of the policy turned out to be wishful thinking. We are fortunate that we have hindsight but this does represent the old age problem of theory translating into reality. It is well-known that policies that have been tested in the real world are always more valuable than detailed research. This is where industry can help. Companies in the energy sector can conduct their own pilot studies. They are better placed than Whitehall to experiment and test policy. Industry has the opportunity to think more creatively and try new novel ideas that can actually change and disrupt the energy sector for the better. Plus it will result in hard data, case studies and evidence to give any policy a head start.
The Energy and Climate Change Select Committee will undoubtedly be missed. However, it is not the end of the scrutiny for energy or climate change policy. There are avenues both within and outside Parliament. Industry can now take a proactive role to ensure energy gets the scrutiny it deserves.