New energy idea for Scotland put forward by Jenny Marra MSP

18 January 2012

Jenny Marra MSP put forward a new idea for Scotland today to Dundee City Council that could see household fuel bills fall in the City by 20%.

Ms Marra has been investigating fuel poverty since she was elected last May.

She brought a debate forward in parliament on the subject and has been challenging the SNP government on their cut to the fuel poverty budget as more and more Scottish households fall into fuel poverty as gas and electricity bills increase.

After researching what other countries in Europe are doing about fuel poverty, Jenny Marra has uncovered an idea that is working in Holland and is being trialled in Manchester to use collective community bargaining to negotiate a price with energy companies.

Speaking today during Big Energy Week, Jenny Marra said:

"This is a simple but exciting idea.

"Councils or housing associations seek the permission of their residents to negotiate a bulk buy price with the energy companies.

"The more tenants involved, the greater the buying power. If Dundee City Council were to negotiate with the energy companies on behalf of all its council tenancies, tenants could save up to 20% on their annual fuel bills.

"I had this idea recently when I visited the Dallfield multis on the Hilltown.

"The multis are getting a new efficient boiler to serve all four multis but tenants still have to buy their energy from separate companies.

"I thought this seemed silly and I asked British Gas why communities didn’t get together and bulk buy their energy.

"British Gas were quick to tell me that European Competition Law prevented this as every consumer has the right to choose their supplier.

"But lawyers at Ofgem, the energy regulator, have confirmed that as long as each individual opts in to the collective bargaining scheme, then there is no contractual obligation and they can be part of a collective bargaining unit for energy prices.

"Then I discovered that such a scheme operates in Holland and the City Council in Manchester is taking forward the same idea at the moment for their tenants.

"The obvious negotiator in Dundee is the Council.

"They have nearly 14,000 tenancies and could bulk buy energy for all their tenants.

"They also have the information and infrastructure to seek the permission of all their tenants at not much extra cost since they are in regular contact with their tenants.

"I’m sure Council tenants in Dundee would like to be the first households in Scotland to try this scheme. I have written to Dundee City Council today to ask them to set this scheme up.

"There’s no time to waste. 25% of households in Dundee struggle to pay their bills, and there is no sign that energy costs will fall soon. We need practical solutions and I think this one is worth trying."

Click here to view the 'Going Dutch' research paper by the New Local Government Network 


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