A publicly owned Scottish energy company would struggle to persuade people to switch providers and differentiate itself from existing operators, according to industry representatives. MSPs at Holyrood’s economy, energy and fair work committee heard about the challenges the proposed new entity would need to overcome. Analysis provided by PWC, the accountants, for the Scottish government this year had suggested a new company would need £3.5 million to set up and about £9 million of running costs in its first year. The report also pointed out that many existing businesses in the sector run at a loss. Yesterday at Holyrood, Alister Steele, chairman of Our Power Energy Supply, which is owned by housing associations in Scotland, warned that the supply market is extremely competitive. He said: “I would question whether this is the right thing for government to be doing. There are a lot of risks involved in entering the market.” Nicholas Gubbins, chief executive of Community Energy Scotland, said: “I struggle to see how a publicly owned supply company would add value.” Mr Steele said he had yet to see the evidence that a new provider would be able to get more people to change supplier and help to reduce fuel poverty. He said: “It is very difficult to get people who are not engaged with the energy sector to switch.” There was also concern over whether the new company would be able to invest in community renewable energy schemes. Mr Gubbins said he could not see how a publicly owned body “would make much difference” in that area. However, Peter Speirs, public affairs manager at Scottish Renewables, said: “I think the difference a publicly owned company could [make] is the political will to do it. “The financials may be difficult from the perspective of the private sector but the political will could exist to support community level generation.” Gail Scholes, chief executive of Robin Hood Energy, the supplier owned by Nottingham city council, said her organisation hoped to invest in its own generation schemes in future but only when its profit improved. There was support for the company to act more like a government agency covering matters such as encouraging greater awareness of energy sector changes and use its position to join up initiatives used at a local authority level. Mr Speirs said: “That would represent an opportunity to behave a bit more like other countries, perhaps Denmark and Sweden, and have an organisation embedded within government that is committed to maximum renewable generation.” Mr Gubbins said: “We need to move to a position where the consumer is informed and engaged.
Times 24th Oct 2018 read more »