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Could Scottish independence lead to higher energy bills?

Yes, according to Energy Secretary Ed Davey

Ed Davey says Scottish independence will lead to higher energy bills for Scots

Ed Davey says Scottish independence will lead to higher energy bills for Scots

The energy secretary has warned that as Scotland’s three million homes have their energy subsidised by the 33 million across the UK, bills would rise should Scotland become independent.

He added that Scotland would need to invest a larger percentage of its national budget in renewable energy generation.

‘The United Kingdom is greater than the sum of its parts’

Speaking ahead of the Scottish Renewables Annual Conference, Davey said: “I have no doubt, that with the talents of its people, and its natural resources, Scotland could make a go of it alone, but the United Kingdom is greater than the sum of its parts.

“When it comes to energy, the positive case for Scotland in the United Kingdom is simple. The size of the United Kingdom protects Scottish consumers from the full costs of Scottish power generation.

“In the United Kingdom, Scotland’s households pay less than they would in Scotland alone. Why? Because, the UK’s integrated energy market is ten times larger than that of Scotland’s alone.”

One tenth of homes and one fourth of the renewable budget

Davey added that although Scotland accounted for a tenth of all UK households, the nation currently benefitted from one fourth of the UK’s renewable generation budget.

Should Scotland leave the UK, according to Davey, higher energy bills, taxes or general cuts would be needed to maintain the same level of investment.

Scottish Government: Claims are ‘Inaccurate and misleading’

A spokeswoman for the Scottish Government dismissed Davey’s claims.

“The whole of the UK needs to produce and supply greater amounts of renewable energy to meet legally binding targets and help keep the lights on, and the costs of paying for this energy are spread across all electricity consumers – there are no taxation issues involved whatsoever,” she said.

She said that energy bills in Scotland would actually go down if the nation became independent, as the Energy Companies Obligation and the Warm Home Discount levies would be removed from bills.

The spokeswoman added that the reason Scotland currently takes up a large percentage of the renewable budget has little to do with its population and much more to do with the fact the nation produces much of the UK’s renewable energy.

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  • Daniel Norton

    Don’t forget the Hydro Benefit (AAHEDC) where bill payers in England & Wales subsidise the higher distribution costs in the north of Scotland. This is worth £55m in 2013/14 or about £90 per household in the north of Scotland. It’s barely noticable when shared amongst the 25m households in Great Britain but would be a much bigger burden for bill payers in an independent Scotland.