Energy firms to work with Scottish Government to cut bills for vulnerable customers

Energy firms are working with the Scottish Government to deliver a “social tariff” that could cut fuel bills for vulnerable customers.

Ministers are working with E.On, EDF Energy, Scottish Gas (Centrica) and consumer organisations on a new working group which aims to design the special tariff – which it is hoped could provide more affordable energy for those in need.

The move comes after the Scottish Government’s climate action minister Alasdair Allan chaired a roundtable event to consider what could be done to help those struggling with energy costs.

Allan said: “The Scottish Government has repeatedly called for a social tariff for those who need it the most, including those in extreme fuel poverty.

“It’s great news therefore that the energy suppliers and consumer organisations have agreed to work with us on this.”

The minister accepted there is “some way to go” before a social tariff – which would see certain customers charged a reduced rate for their gas and electricity – becomes a reality.

He said: “This is a real step forward and could produce a model for fairer energy pricing not just in Scotland but in other nations too.”

It comes as the average household energy bill is set to increase by £149 from October after industry watchdog Ofgem confirmed it was increasing its price cap.

At the same time, the Government is withdrawing winter fuel payments from millions of pensioner households across the UK who are not in receipt of benefits.

Timescales for the Scottish Government’s new working group are to be agreed shortly but Allan added: “We recognise the urgency in delivering extra support for consumers struggling with their energy bills.

“We remain committed to working closely with the UK Government, Ofgem, suppliers and consumer organisations, advocating for the delivery of a social tariff across Great Britain.”

Gillian Martin, acting energy secretary in the Scottish Government, wrote last year to the previous UK government, setting out the principles ministers at Holyrood think should be key features of a social energy tariff.

She made clear the Scottish Government believes such a scheme should be used to provide additional support for customers rather than acting as a replacement for existing forms of support.

Ministers at Holyrood agree any new social tariff should be applied automatically to anyone in receipt of means-tested benefits – but could also help those on low incomes who just miss out on qualifying for benefits and who are at risk of fuel poverty.

People who have high energy bills because they need to use medical life-saving equipment for long-term conditions should also be eligible for any such scheme, the Scottish Government believes.