Secretary of State for Energy & Climate Change Edward Davey has made the positive case for the UK's single energy market, showing how independence would increase people's energy bills.
Launching the UK Government’s Energy Paper analysing the potential impact of independence on Scotland’s energy, Mr Davey argued that because the single UK energy market is ten times the size of Scotland’s energy market, Scottish energy bills are lower.
He listed a range of reasons, including the way investment in transmission and distribution networks are currently shared across the whole of the UK, to the way the subsidies for energy distribution in remote rural areas like the Scottish Highlands and Islands are currently paid for by all British consumers not just Scottish bill payers.
The government’s analysis shows that energy bills in an independent Scotland would be higher by at least £38 a year and perhaps by up to £189, once the full cost of supporting renewables are included. #
In addition, if the full costs of supporting large scale Scottish renewables fell to Scottish bill payers the total potential increase would rise considerably for businesses as well to around £110,000 for energy costs for a medium-sized manufacturer in 2020 and £608,000 for a medium sized manufacturer in 2020.
These figures do not include the costs an independent Scotland would face for its share of decommissioning and legacy costs for old coal and nuclear industries and oil and gas infrastructure. Nor do they include the likely increased costs for consumers of reduced competition.
“The UK works better together, and our single energy market shows why,” said Mr Davey. “As a United Kingdom, we keep energy bills down for all consumers, regardless of where they live, and this works well, especially for people in Scotland.
“Without unrestricted access to the integrated GB market, the costs of supporting Scottish energy network investment, small-scale renewables and programmes to support remote consumers would fall on Scottish bill payers alone – this would add at least £38 to annual household energy bills and around £110,000 to energy costs for a medium-sized manufacturer in 2020.
“In addition, if the full costs of supporting large scale Scottish renewables fell to Scottish bill payers the total potential increase would rise considerably up to £189 for households and £608,000 for a medium sized manufacturer in 2020”.