Scottish ministers are weighing options for setting up a new state-owned company that would supply household power and could invest in renewable energy. The model set out in a consultancy report could extend in the long term to providing broadband. One of the options is for a national provider to sell electricity and gas through local councils. The plans have been drawn up by consultancy EY. The report estimated the cost of setting up the company could be up to £3.5m, with first year running costs at £9m. However, it has warned that there is already tough competition on price, with 42 rival companies in the Scottish market. EY also highlighted the risk to the Scottish government of making a loss. Of those 42 firms, half reported a loss in their most recent accounts, including two of the so-called “Big Six”. More than half of them highlight their competitive prices in trying to attract customers. Yet the market still fails to operate properly because so many people fail to consider switching providers to get a better deal. EY sets out the possibility of operating under a “white label” company. As happens in some cases already, energy suppliers operate through trusted brands. But as such a brand, the Scottish government would lack control of prices. It is seen as being able to focus instead on boosting more efficient use of energy, to reduce the amount used in households where people struggle to afford adequate heating and fuel.
BBC 9th April 2018 read more »