Cable costs could result in higher bills

There is a warning that the high cost of replacing expensive subsea electricity cables could lead to a direct price hike in bills for customers in places such as Orkney.

Fuel poverty campaigners have warned of the potential increase this week as Scottish Hydro Electric Power Distribution (SHEPD) continues consulting on plans to replace many of the cables to the islands over the next eight years.

The project had been expected to cost £44million – but there are fears the bill could rise to £300million because of a recent requirement in Scotland’s National Marine Plan that all the cables be buried instead of lying on the seabed.

Any increase would have a knock-on impact on consumers in northern Scotland because distribution costs account for about a quarter of bills.

The region already pays more for electricity than any other part of the UK because of regional distribution costs.
The Highlands and Islands Housing Associations Affordable Warmth Group has estimated that “every” consumer in northern Scotland would be hit with a bill rise of 5.8% – an average of £73. But for those who already pay more and live in remote areas – such as Orkney – the group said it could mean a 10% increase of up to £235 a year.

New local charity Tackling Household Affordable Warmth in Orkney (THAW Orkney) responded to Scottish Hydro Electric Power Distribution’s consultation on Submarine Electricity Cables back in October and stated that the potentially massive additional cost on consumer bills was the most significant and extremely concerning drawback of the proposals for increased submarine cable protection.

Robert Leslie, a trustee of THAW Orkney, who also sits on the Highlands and Islands Housing Associations Affordable Warmth group, described the potential hike in bills faced by electricity customers in Orkney as ‘eye-watering’ and ‘an injustice’ when the islands had already generated more than their annual electricity demand in 2013 and 2014 (103% and 104% respectively).

He also said it is also fair to say that it will impact on the costs for businesses in Orkney as well as domestic customers.
He said: “THAW Orkney was formed to promote a co-ordinated effort to help householders achieve affordable warmth. The concern from our point of view is that any improvements that we can bring about will be negated if any additional costs associated with cable protection are paid for by electricity consumers in Orkney and the rest of the SHEPD network.”

“Orkney is second only to the Western Isles in terms of fuel poverty levels, and this is largely due to increases in electricity costs in recent years, along with our windier, wetter climate, longer heating season, and older housing stock with associated low energy efficiency. Any further hikes would be eye-watering for many customers and basically an injustice for a place that more than meets its electricity demand through renewable generation.”

Mr Leslie said that he understood that SHEPD were looking to set up further consultation events in Orkney and the Western Isles, possibly in early February, and urged folk who felt strongly about the impact of increased costs to look out for these.