Westminster Effect means Scots experience more fuel poverty than any EU nation.

In a week of freezing temperatures, Scottish households are counting the energy cost of the Union. In energy-rich Scotland, fuel poverty rates are higher than any EU country and more than double that of England.

Not only that Scottish businesses pay the highest commercial prices for energy in the world. 

Almost a third of Scots are shivering in homes they cannot afford to heat during this cold spell. Scotland’s rich resources are producing lots of valuable energy - but Scots don’t get the benefit. 

Poverty Alliance chief executive Peter Kelly said: "It's just wrong that in an energy-rich country like Scotland, we have nearly a third of our households living with the injustice of fuel poverty. 

“When cold weather hits, people need to be able to heat their homes properly - but we've heard examples of people spending a third of their income topping electricity meters, and others being terrified to put their heating on at all. The bills are unaffordable for people on low incomes. They will cause stress, anxiety, illness, debt and death."


So much for the old saying about the ‘broad shoulders of the Union’ - the idea that being in partnership with a larger country should mean that Scots are better off than they would be in an independent country but precisely the opposite is true.  

As part of the UK, Scots are being penalised by an unfair energy system that doesn’t serve the needs of the people. Scots pay more for energy than people in England where fuel poverty stands at 13%. It is warmer in England and standing charges there are lower. Plus most households in England have access to the gas network, which rural Scots don’t.

Age Scotland Chief Executive Katherine Crawford said: “This harsh cold weather and the snowy and icy conditions it brings are causing older people great anxiety. Older people in Scotland are the group most likely to be living in fuel poverty and a quarter are in extreme fuel poverty. Having lost their Winter Fuel Payment, many will be living in colder homes, eating fewer hot meals and are now facing a further increase in energy bills as of the new year.”

Westminster policy means Scots experience more energy poverty than any EU country 

In the EU, the highest rates of fuel poverty are in  Portugal, Spain, Bulgaria and Lithuania where around 20% of households are in fuel poverty. Even former Soviet states like Romania do better, at 12.5%. 

In Ireland the rate is just 7.2%. In Denmark and Sweden where temperatures are below what Scotland typically experiences, fuel poverty is around 6%. In Finland fuel poverty is about the lowest in Europe - just 2.6%

There are few areas of Scotland where the rate is as low as 20%. The average across Scotland is 31%. Most of Scotland is at least 25% and in the Western Isles it is 40%. 

The situation is even worse for pensioners - about 40% of them are in fuel poverty in Scotland. About 900,000 of those who were expecting to get a winter fuel allowance of about £100 to £300 this year lost out on even that at short notice, thanks to decisions taken at Westminster. (The Scottish Government plans to mitigate this but that won’t take effect until next year).

Three key Westminster policies that creates fuel poverty in Scotland

  • UK governments that Scotland didn’t vote for privatised energy 

One reason for the difficulty Scots face is that Scotland’s energy infrastructure was privatised by UK governments Scotland didn’t vote for. Only one other European country has done that - Portugal, which was forced to do so by an economic crisis. Portugal is next after Scotland in terms of energy poverty now.

Private companies based in Scotland or with large holdings in Scotland make huge profits 

Scotland generates around 15.5% of the UK’s electricity – nearly double its population share of 8.2%. 

In 2023, Scotland exported a total of almost 18 TWh of energy to England. It imported about 1.5 TWH so the net total was 15.5 TWH exported - enough to power almost 3 million homes. 

If Scotland were an independent country with a publicly owned power company, like Iceland, it would be generating much more money from this than ends up in the public coffers under the current arrangement. 

The theory of a privatised energy system was that the regulator would enforce fair treatment of consumers. Few would argue that regulation has been effective for Scotland. 

  • Standing charges are higher for Scots

Energy companies in Scotland charge more for distribution infrastructure which is paid for by customers in each region. The current daily standing charge is 61.97p a day for northern Scotland and 64.17p for southern Scotland. London and the South East have lower costs at 41.57p and 57.84p respectively.

  • Energy tariffs are held at the same rate across the UK

Scots might not mind paying a higher rate for distribution infrastructure if they also got a cheaper tariff for energy because so much is produced here.

Many countries offer cheaper renewable energy close to where it is created - obviously it would be much cheaper and easier to move electricity produced by wind turbines on Shetland to homes in the area. 

But the UK government’s regulator Ofgem mandates that every household across the UK pays the same tariff per unit of energy consumed - even though those in the north of Scotland have to use much more of it to keep their home warm. 

They even spent more than £200 million of public money last year turning off the wind turbines and other renewable power because there was no capacity on the grid to move it to England. That energy could have been used locally if the price was lower.

There is a regional rate for standing charges - but one UK-wide tariff for energy. That system penalises Scots. 

Conclusion

Scots see their old folk and struggling families struck with fuel poverty rates that are way beyond what other European countries have to face.

This is entirely down to decisions taken at Westminster. Privatising the energy infrastructure was an experimental idea put into practice by governments Scotland didn’t vote for.

Scots are counting the cost of allowing another country to take responsibility for our affairs. 

Creating Scotland is back on January the 18th in Glasgow for 'A Celebration of Burns and Scottish Culture' click here or the image below to get your ticket or find out more!