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Energy / Government plans to cut electricity bills by £17

Lerwick power station is set to produce electricity well into the next decade.Lerwick power station is due to close in 2025.

HOUSEHOLDS in the north of Scotland are likely to save £17 a year – less that £1.50 per month – should government plans to spread the extra cost of providing electricity to islanders in Shetland more fairly be implemented by April next year.

The department of business, energy and industrial strategy has just launched a two month long consultation on the proposal.

According to the UK Government it cost £18 million a year more tokeep the islands’ 23,000 residents’ homes and businesses powered than it does to provide power on the mainland. These cost are expected to rise to £27 million per annum from next year.

Up until now these extra cost were picked up by consumers in the north of Scotland, but they could soon be spread across all UK customers, which would lead to a £17 per year reduction in north of Scotland electricity bills.

The idea was first mooted five years ago, but received very little media coverage, when then prime minister David Cameron was shown around Shetland by isles MP Alistair Carmichael just two months ahead of the Scottish independence referendum.

Carmichael said on Sunday: “We all know that the wheels of government grind slowly but for it to have taken five years to get this fairly modest measure over the line is ridiculous.

“That said, it is still very welcome. Obviously there are extra costs involved here and it is right that these should be spread across the whole network and not confined to an area that is already disadvantaged in other ways.”

Minister for energy and clean growth Chris Skidmore said: “Consumers in the north of Scotland should not have to fund the costs of maintaining Shetland’s energy security alone.

“The ability to share costs more widely is one of the benefits of being part of the United Kingdom and these plans will mean consumers in the north of Scotland will soon receive a welcome saving on their bills.

“Shetland is different to other Scottish islands as it’s the only part of Britain’s licensed distribution network that is isolated. It’s unable to benefit from the economies of scale enjoyed by other islands, which are part of the integrated network, which is why costs have always been higher.”

The consultation can be found here.