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Energy Prices Act 2022 (Extension of Time Limit) Regulations 2026

My Lords, I will respond to the Energy Prices Act 2022 (Extension of Time Limit) Regulations 2026 and the related Utilities Act 2000 (Amendment of Section 105) Order 2026, which has already come into force as a companion SI. I thank the Minister for his introduction.

These instruments are technical and minor, but important. They enable the Government to continue to deliver support through the RO to Exchequer scheme, under which 75% of the domestic cost of the renewables obligation is funded by the Exchequer, rather than passed through to household bills. This matters because households remain under intense pressure from high energy costs at a time of renewed global energy insecurity. The renewables obligation is a legacy scheme that was closed to new generators in 2017 but will continue for existing participants until 2037. The Government’s decision, announced in the November 2025 Budget, to shift 75% of the domestic cost to the Exchequer was therefore welcome. This continuation is expected to reduce average household bills by over £100 a year. This alone will not resolve the wider cost of living challenge, but it is a sensible and pragmatic intervention.

The purpose of this statutory instrument is relatively straightforward. It extends by six months, from 25 April to 25 October 2026, the time limit under the Energy Prices Act 2022, allowing the Government to keep using these powers while legislative changes are prepared. In the absence of primary legislation, this is the only way to avoid a gap in this financial support. We therefore support the Government’s intention to maintain assistance under the scheme.

Support to reduce consumer energy bills is needed now more than ever. However, the possible need for repeated short-term extension does raise some broader concerns about timetabling and certainty. Households should not risk losing support simply because the powers needed to deliver it are temporary and expire before replacement legislation is ready. I understand that the Government expect that further instruments will be needed—the Minister confirmed this in his speech—to extend this period again. Without primary legislation in place by October, another SI will need to be brought forward. I understand that the department is working on permanent legislation, which we welcome, but this SI is in effect a short-term bridge, not a long-term permission to proceed indefinitely. It buys the Government time either to legislate or, failing that, to bring forward a further SI.

I will therefore ask the Minister a couple of questions. First, when does he intend to bring forward the proposed primary legislation? What legislative vehicle might be used: will it be the energy independence Bill? How will the department ensure that there are no gaps when temporary powers are replaced?

4.15 pm

I wanted to ask the Minister some questions, because I was concerned about the use of the six months and why the Government were not seeking a longer extension

period, but the Minister has been kind enough to answer those questions in his statement to me. I do not see any realistic prospect of legislation coming in within the six-month period, so my understanding is that this measure will need to be extended. The Minister said quite clearly that, as far as he is concerned, this instrument is the only way to do that, because of the sunset clause in the original Act, but it would be good if he could confirm this.

The companion instrument, the Utilities Act 2000 (Amendment of Section 105) Order 2026, is an information-sharing counterpart to this SI. It came into force in March and allows the Government to share information on draft energy prices to enable these powers to be enacted. I ask the Minister what has happened since March. How is that information-sharing process working? What safeguards will be in place to protect data, privacy and competition as more detailed information is shared? More broadly, will the Government review the wider information-sharing arrangements across the energy system, including future replacement schemes? I am sure the Minister will agree that there is a need for greater information sharing between government departments to ensure that greater, more targeted energy support can be provided.

In short, we support these regulations in principle. Continuing support for households facing higher energy bills is essential, but much more remains to be done to deliver a lasting reduction in energy costs and greater predictability for consumers. Households need stable and predictable help, not piecemeal extensions. Suppliers need clarity on data and processes, as well as legal frameworks that underpin that help. These regulations are a welcome step, but the real test will be whether the Government turn this temporary fix into lasting solutions that serve consumers, suppliers and the low-carbon transition alike.

Beyond this SI, the Government must accelerate renewables deployment; advance long-term energy market reforms; move more policy costs off bills and into general taxation; and bring forward a social tariff that is supported by improved data sharing and targeted assistance. We on these Benches will continue to hold the Government to account, but we will also support them where we can in the face of what may prove to be the most serious global energy crisis that our generation has ever seen.