Energy plight facing north householders 'simply unforgivable'
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It is "simply unforgivable" that Sutherland and other areas rich in renewable resources face some of the highest energy bills in the UK, Maree Todd has said.
The SNP MSP for Caithness, Sutherland and Ross described the energy system as "broken", with many of her constituents facing "crisis point". And she argued: "A complete overhaul of the market is needed to guarantee energy security and to deliver fair energy prices for our rural communities."
Ariane Burgess, Scottish Greens MSP for the Highlands and Islands, also spoke of the "broken regulatory system" and its impact on the cost of living. "This is one of the wealthiest societies in the world and nobody should be having to choose between freezing and starving," she said.
Edward Mountain, Scottish Conservative MSP for the Highlands and Islands, argued that the UK needs to stop being reliant on energy produced overseas and that nuclear power should be encouraged.
Caithness campaigner Iain Gregory agreed that nuclear is "vital" and said it was essential to set up a national energy company.
Caithness Poverty Action Group's Allan Tait noted that local charities are seeing people "struggling to cope" and pointed out that an initial discussion had taken place with wind farm developers locally on the possibility of additional support to help the most vulnerable this winter.
The Northern Times sister papers - the John O'Groat Journal and Caithness Courier - contacted a number of MSPs, as well as local groups with a direct interest in the energy cost crisis, and put three questions to them – about the impact of the prices rises; about possible solutions to bring bills back down to affordable levels; and about the circumstances that have resulted in some people in Caithness and Sutherland facing extreme fuel poverty despite living close to large renewable energy developments.
Liz Truss unveiled measures to limit energy bill rises soon after becoming Prime Minister. Her intervention was met with a sense of relief, although concerns persist over the plight of many householders who will continue to struggle.
Ms Truss announced that the typical household energy bill will be capped at £2500 annually for two years from October 1. It had been due to rise from £1971 to £3549 in October.
She also said businesses will get a package for six months which will provide equivalent support. After the six-month period, further support will be targeted at “vulnerable industries”.
Ms Todd said: “The belated announcement of a cap of £2500 annually on average household energy bills will not prevent low-income families in my constituency from experiencing extreme fuel poverty this winter. Targeted support and additional devolved funding are needed urgently to prevent households from plunging into destitution.”
Iain Gregory is co-founder of Caithness Roads Recovery, which has developed into Caithness Roads "to" Recovery – reflecting the increasingly wide range of its campaigning work.
Allan Tait, senior development officer at Caithness Voluntary Group, was commenting on behalf of Caithness Poverty Action Group.
How did we get into this position and what impact is it having?
Maree Todd: “While the nation mourns the passing of the Queen and we extend our condolence to the royal family, we must also recognise that every effort to mitigate the worst impacts of the deepening energy crisis must continue.
“The increase in energy costs is attributed to the global rise in the wholesale price of gas but the impact on consumers in the UK is significantly more compared to the likes of our European neighbours. The French government, for instance, chose to cap the rise at four per cent rather than passing on the high wholesale price on to consumers. Spain lowered VAT on energy bills from 21 per cent to 10 per cent and cut taxes on electricity from seven per cent to 0.5 per cent. Meanwhile, the UK government – which holds the key levers to address this crisis – wasted the entire summer sitting on its hands, causing huge anxiety for families and uncertainty for businesses.
“The lack of early intervention from the UK government has left many of my constituents facing crisis point.
“The belated announcement of a cap of £2500 annually on average household energy bills will not prevent low-income families in my constituency from experiencing extreme fuel poverty this winter. Targeted support and additional devolved funding are needed urgently to prevent households from plunging into destitution.”
Iain Gregory: "There are numerous factors at play here, as well as the Ukraine situation. Energy costs have been rising fast for many years, and we cannot ignore the fact that the energy supply industry in the UK is exactly that – an industry – where profit is the main driver. In addition, we have allowed ourselves to become dependent on the import of foreign gas (and electricity), with huge extra costs piled onto consumers via various levies and tax, while vast profits are being made by companies and shareholders. The impact on individuals and businesses is catastrophic."
Ariane Burgess: “People in rural communities are already far more likely to experience fuel poverty and face far higher costs for travel, delivery and household goods. Now they are being squeezed on all fronts – with soaring inflation and skyrocketing energy prices.
"This isn’t just a market failure; it is also a failure of Ofgem and the broken regulatory system. This is one of the wealthiest societies in the world and nobody should be having to choose between freezing and starving.
"Without immediate action, these price rises will undo the recovery so many businesses have worked hard on since the pandemic and plunge families all over the country into destitution and poverty.
"That’s why it’s such good news that this year’s Programme for Government includes measures to protect and support tenants, who are some of the most vulnerable to cost-of-living rises as winter approaches. Scotland will bring in a rent freeze and a halt to evictions until at least March 31, 2023. This emergency legislation will be robust, properly worked up and effective.
"It’s part of a wider package of help, including widened access to the Tenant Grant Fund and an increased fund for discretionary housing payments. And the Greens will keep pushing for further wins, such as reforms to rent adjudication and civil damages for illegal eviction.
"And I’m delighted that this Programme for Government will implement the Greens’ and government’s shared commitment to increase investment in energy efficiency and renewable heat, to make it cheaper and greener to heat your home.”
Edward Mountain: "The cost of energy is rising exponentially because of Putin’s invasion of Ukraine and his decision to slow wholesale gas supplies to Europe to a trickle. The impact of this is being felt across every community, especially households on lower incomes and businesses. Farming is hugely dependent on fossil fuels too, and the massive spike in input costs is already having a dramatic impact on food prices."
Allan Tait: "Energy prices have been going up for a number of years and, even before the proposed October price cap, prices have doubled in the last year. Add in rising food costs and it is no surprise that local charities are seeing people struggling to cope and also seeing people getting very anxious as to how they will cope this winter."
Some financial assistance is being made available, but what can be done to achieve a longer-term solution to bring bills back down to affordable levels?
Maree Todd: “The energy system is broken. A complete overhaul of the market is needed to guarantee energy security, to deliver fair energy prices for our rural communities and to prevent this situation from recurring in the future.
“For me, the long-term solution is independence. Without the powers of borrowing, taxation and energy regulation, the Scottish Government is significantly constrained in its response to a crisis such as this.
“We cannot rely on Westminster to do the right thing, as this emergency has only further emphasised."
Iain Gregory: "The price cap has been suspended for two years (or at least held to £2500). The 'green levies' have been suspended. I maintain that setting up a 'national energy company' is essential. Steps are being taken to open up oil and gas fields, so that will go some way to achieving 'energy independence'.
"Nuclear is still vital. I maintain re-nationalisation must still take place. And as to tax thresholds in Scotland, the position is unchanged – they need to be brought back in line with the rest of the UK."
Ariane Burgess: "There is a big role for government in providing direct support to people and lowering the cost of living.
"I’m proud that the Greens have worked with colleagues in government to double the Scottish Child Payment, which is now worth over £1000 a year for every eligible child. This has been a lifeline for thousands of children and their parents. We have also introduced free bus travel for everyone under 22 while ensuring that all Scottish Government contracts pay at least the living wage.
"There are vital steps that can be taken to mitigate the impact, but the biggest ones can only be done from Downing Street.
"But the Tories seem obsessed with tax cuts, which will do nothing to help those with the lowest incomes. The new Prime Minister has vowed to approve new drilling in the North Sea, instead of investing in clean power from our own renewable resources, recognising how much the cost crisis is a product of fossil-fuel addiction in the first place.
"There are big steps that can be taken right now that would make a huge difference. But, whether it is nationalising the big five energy companies, reversing this terrible rise, raising minimum wage to a liveable level or reversing the cruel cuts to Universal Credit, they can only be done by the Prime Minister.”
Edward Mountain: "I welcome the energy support package outlined by the Prime Minister, which helps address the price rise in electricity. It’s important that the government also helps those who use oil to heat their homes, like many Highlanders do.
"The most important thing that this country can do is to stop being reliant on energy produced overseas. To that end, we should be encouraging nuclear power to become part of our energy mix. We should also look at offshore wind farms, which are less detrimental to the natural landscapes of the Highlands."
In Caithness we have large renewable energy developments both onshore and offshore, with others planned, yet many people living close to these projects are facing extreme fuel poverty. Why is this?
Maree Todd: “It is simply unforgivable that areas like Caithness that are rich in renewable assets are presented with some of the highest energy bills in the whole of the UK.
“The high percentage of dwellings off the gas grid combined with the colder weather and an energy pricing regime that penalises our rural communities means that the threat of the current crisis to livelihoods and lives in my constituency is even greater.”
Iain Gregory: "Once again, we come back to the question of private versus public ownership. It is insane to be major exporters of energy in Caithness while many people cannot afford to heat or eat. The energy flows south (and then back again) and local people are largely priced out. From day one of the rush to renewables, the emphasis should have been on public benefit – not private profit."
Ariane Burgess: “Renewable energy is the best and cheapest form of energy, yet, at present, the energy created from renewable sources is fed into the National Grid along with the energy created from non-renewable sources.
"It is a broken system which needs to be reformed alongside more community ownership so that renewable developments benefit those that have them on their doorstep.
"It doesn’t need to be like this. Our communities have the skills, infrastructure and geography. They are already at the forefront of green technology and can lead the renewables revolution that our country so badly needs. We need to harness these resources while ensuring that local people are at the heart of our decisions.”
Edward Mountain: "As a way forward through this energy crisis, I believe that the wholesale price of green generated electricity – wind, tidal or hydro – should be temporarily frozen at the predicted price that justified these developments in the first place. This would ensure that there remains a green dividend for those that need it but would also de-link the price of green energy from gas. That would ensure homes and businesses receive green energy at a fair price."
Allan Tait: "Decisions around planning years ago clearly did not put enough focus on public benefit to the local community. Going forward, we need to address this and as part of that Caithness Poverty Action Group has had an initial discussion with wind farm developers locally to see if there is additional support they can provide this winter to help the most vulnerable. These discussions will continue."
The new Prime Minister Liz Truss told the House of Commons the week before last: "This government is moving immediately to introduce a new Energy Price Guarantee that will give people certainty on energy bills.
"It will curb inflation and boost growth.
"This guarantee – which includes a temporary suspension of green levies – means that from October 1 a typical household will pay no more than £2500 per year for each of the next two years, while we get the energy market back on track.
"This will save a typical household £1000 a year. It comes in addition to the £400 Energy Bills Support Scheme.
"This guarantee supersedes the Ofgem price cap, and has been agreed with energy retailers.
"We will deliver this by securing the wholesale price for energy, while putting in place long-term measures to secure future supplies at more affordable rates.
"We are supporting this country through this winter and next, and tackling the root cause of high prices, so we are never in this position again.
"For those using heating oil, living in park homes or those on heat networks, we will set up a fund so that all UK consumers can benefit from equivalent support.
"We will also support all businesses, charities and public sector organisations with their energy costs this winter – offering an equivalent guarantee for six months. After those six months we will provide further support to vulnerable sectors, such as hospitality, including our local pubs."
Ms Truss made it clear that "we will not be giving in to calls for this to be funded through a windfall tax".
She said: "That would undermine the national interest by discouraging the very investment we need to secure home-grown energy supplies. You can’t tax your way to growth.
"Instead, we are taking an approach which is pro-growth, pro-business and pro the investment we need for energy security.
"This is the moment to be bold. We are facing a global energy crisis and there are no ‘cost-free’ options."
