Scotland to set up publicly owned electricity supplier

The leader of the SNP, Nicola Sturgeon, has announced this week that she plans on creating a publicly owned not-for-profit electricity supplier which will operate in Scotland. The supplier will only sell renewable energy. She believes this will make energy more affordable for poorer income families and help get people out of fuel poverty.

It was made clear that this will be an electricity supplier only and the Scottish Government do not plan on controlling any power generation facilities of their own. The publicly owned supplier will purchase electricity for a low price and sell it on to customers at as close to the price they paid for it as possible.

Critics of this plan point to the fact that the margins for electricity suppliers in the domestic market are already relatively low and that even a publicly owned supplier would still have overheads to pay.

This would not be the first not-for-profit to set up in this sector with organisations already in operation in cities such as Nottingham. Interestingly enough, these not for profits are not always the cheapest option on the market.

The SNP plan to have the new supplier operating in the market by 2021 and Ofgem have already announced that they will welcome the new entry. There will be a number of countries around the world watching closely at the success of the supplier, as world electricity prices increase and they become increasingly pressured by the public to deliver affordable energy.