The Scottish government has confirmed its commitment to setting up a public-owned energy company despite last week’s collapse of Our Power.
Aileen Campbell, cabinet secretary for communities and local government, told the Scottish parliament that the Holyrood administration had been notified before Christmas that the not-for-profit supplier was in financial difficulties.
She said: “We will, of course, continue to develop proposals that will deliver the ambition of a public energy company, and we are on track to deliver that ambition by the end of this session of parliament.”
The next Scottish parliament elections are due to take place in 2021.
Campbell added that the Scottish government’s plans for a public energy company complement its “much wider work” on energy consumers and fuel poverty.
And she said that, given that more than half of all customers are still on “expensive” standard variable tariffs, the new supplier would provide Scottish consumers with more choice.
But the minister expressed “disappointment” with the failure of Our Power, which has resulted in around 70 job losses, mainly in the poor Edinburgh neighbourhood of Craigmiller.
“The approach was a new attempt to find a way to give predominantly social tenants access to low-cost power. Our Power did so for three and a half years. I reiterate and underline how disappointing it is that, ultimately, the approach has not quite succeeded in this case.”
She also said that the Scottish government would provide energy efficiency support to Our Power customers as needed, through its home energy Scotland service.
Citing the statement by Our Power chairman Alister Steele that it is “unclear what the level of financial backing is required for a new entrant to cope with market volatility and regulatory change”, Liberal Democrat MSP Alex Cole-Hamilton asked the minister for guarantees that setting up a public energy company will be a safe use of taxpayers’ money.
Our Power’s customers will be transferred to Utilita under Ofgem’s supplier of last resort process.