Emergency support call as Scots face UK's highest energy bills

A postcode lottery of average dual fuel energy bills in Scotland has emerged with the gap between the average highest and lowest dual fuel bills across Scotland's local authority areas alone is set to soar from £728.67 in April, last year to £1260.60 from April 1.

On Thursday some households saw their annual energy bills rise typically by £693 in the UK after the regulator Ofgem hiked the price cap by the biggest increase yet as the Bank of England warned the nation is about to suffer the biggest fall in living standards since comparable records began three decades ago.

The sharp 54% rise, which will impact half the population, is said to be driven by a record rise in global gas prices over the last six months, with wholesale prices quadrupling in the last year. But the Herald can reveal that in some parts of Scotland, average dual fuel prices will be over 60% higher than the UK average with Argyll and Bute facing a whopping increase of £1344.70 - over 60% more than the price cap level

It comes as it emerged that charges for household water and waste water in Scotland will increase by 4.2% for the next year.

It means water charges, set by Scottish Water and collected alongside council tax, will increase an average bill by 31p per week or £16.31 a year, piling even more pressure on struggling households.

Chancellor Rishi Sunak has said help of £350 per household would "ease" people's anxiety over the increase and take the "sting" out of the rise.

But the scheme was criticised for not being targeted on those most in need.

The SNP has said the UK government is failing to get a grip of the Tory cost of living crisis and "actively undermining Scotland's progress" on tackling poverty.

And finance secretary Kate Forbes will confirm next week how much extra money households in Scotland will receive to cope with the cost of living crisis during the final stage of Scotland's Budget Bill.

From April 1, the three in four dual fuel customers on default tariffs paying by direct debit will see a typical bill standing at £1971, an increase of £833 (73%) since a year ago.

New analysis of official Scottish Government data has revealed that for 1.5m Scots on average dual fuel energy bills the expected to rise by over £1000 from £1375.97 to £2382.13 over the same period because prices are higher north of the border.

The analysis reveals a postcode lottery of average dual fuel energy bills in local authority areas with people on Argyll and Bute, which includes the islands of Bute, Islay, Jura, Mull, Iona, Coll and Tiree, set to witness a huge increase since last April of nearly 60% more than the Ofgem set norm.

While Argyll and Bute residents will pay typically £3,186.76 a year from April 1, that is nearly two thirds more than the UK average and £1260.60 more than the typical household will pay in Glasgow City, which at £1,926.16 will be the cheapest areas for bills in Scotland.

Residents of Comhairle nan Eilean Siar, the council that covers the Western Isles face a rise of £1,281 with typical bills from April 1 set to stand at £3035.80 - that is £1,109.64 or 57.6% more than typical prices in Glasgow.

According to housing analysts one of the culprits in the energy bill gap is the extra cost of supplying and distributing electricity to northern Scotland which is said to be 2p more per kilowatt hour than in the south. That extra cost is passed on to the consumer through network distribution charges and now calls are being made to have them scrapped.

Also blamed is the colder and wetter weather, the condition of the housing stock, and the limited availablility of gas in rural Scotland meaning many only heat their homes with oil or electricity which is more expensive.

The Scottish Liberal Democrats said the energy price analysis showed there needed to be a cost-of-living rescue package to "save households on the brink" and reassure all those worried about how they’re going to pay the bills.

Scottish Liberal Democrat leader Alex Cole-Hamilton said: "We need a cost-of-living rescue package to save households on the brink and reassure all those worried about how they’re going to pay the bills."

Organisations on the Western Isles have raised concerns that this was plunging people living in areas in the north of Scotland into a "desperate plight".

Tighean Innse Gall, the Stornoway housing and energy agency believed the Western Isles already suffers the highest level of extreme fuel poverty in Scotland, and that the latest increase will mean more local people will struggle to pay their bills.

"It is essential that we in the community look after those who are struggling," they said.

the Scottish Housing Condition Survey estimates that 40% of all households in the Outer Hebrides are in fuel poverty compared to the Scottish average of 24%.

Angus McCormack, chairman of the Western Isles Anti-Poverty Group said: “I am deeply concerned at the implications of these increases. Coming on top of other price increases and reduced incomes this is an appalling situation and one which will lead to many in our communities struggling financially.

"We know that there are unacceptable levels of child poverty in the islands and Brexit and Covid have already made standards of living worse for many families. This latest blow will make matters even worse, and I would call on government and all agencies to do what they can’t mitigate the desperate plight that many people will face.”

The Comhairle nan Eilean Siar council leader Roddie Mackay, has written to Ofgem to call for regional variations in the price cap to protect vulnerable communities in the Western Isles and other areas against "debilitating" energy price rises which he said will leave many households in a "totally unacceptable ‘eat or heat’ situation".

He has suggested a lower price cap for areas demonstrably suffering from fuel poverty.

He has also demanded the removal of the "unfair and discriminatory" distribution surcharge placed on all customers in the north of Scotland.

"It is patently unfair that Ofgem and the government appear to have a ‘one size fits all’ approach around an increase in the energy price cap but are happy to allow a geographically differentiated electricity distribution cost," he said.

Ian Blackford MP has called for the Chancellor to bring forward an emergency Budget with a meaningful package of measures to boost household incomes, warning current proposals "won't even scratch the surface and are nowhere near enough to help families cope".

The SNP Westminster Leader said the Tory cost of living crisis "has been a decade in the making", with a toxic combination of Tory cuts, regressive tax hikes, stagnant wages, poor economic growth, and the soaring cost of Brexit all contributing to squeezed household incomes and rising poverty.

Meanwhile, the governor of the Bank of England has come under fire from unions and earned a rebuke from 10 Downing Street for suggesting workers should not ask for big pay rises to help control inflation.

Andrew Bailey said he wanted to see “quite clear restraint” in the annual wage-bargaining process between staff and their employers to help prevent an upward spiral taking hold.

And Ofgem has said it could update the energy price cap as often as every three months instead of every six months as it braces for further volatility across global markets.

Jonathan Brearley, Ofgem’s chief executive, said it would be better to have the option to update the price cap more frequently to allow households to “adjust much more quickly” to some of the changes in the market.

A Scottish Government spokesman said: "As the First Minister said in Parliament yesterday, every penny of additional funding will be put towards helping ease the cost of living crisis.

“The Scottish Government remains in discussion with the Treasury to understand how the Chancellor’s statement impacts on the consequential payments it expects to receive and will confirm the position once finalised.

“Ministers remain committed to the extra £120 million already announced for local authorities.”