Not the job of the trust (John Tulloch)
It has been claimed elsewhere that oil central heating in Shetland costs 4.5p per unit (kWh).
In Argyll it costs about 3.3p per unit (kerosene, 27.8p per litre), which raises an important question over how much dearer oil is in Shetland where more heat is needed due to the harsh climate. Little wonder fuel poverty is rife.
Last Friday you reported that Shetland Heat, Energy and Power (Sheap’s) planned new heat pump system for recovering heat from the sea is intended to replace supplementary oil burning in the district heating system.
Sheap is a subsidiary of Shetland Charitable Trust, created to provide income for the trust.
The heat pump will cost £1.6 million, funded initially with a low interest loan from the Scottish government, to be repaid by some combination of Sheap customers and the charitable trust.
Presumably then, those stakeholders may look forward to a reduction in the price of heat and/or an increase in income for the trust?
Oddly, neither price reductions nor increased trust income were mentioned. Given Shetland’s shocking level of fuel poverty (over 40 per cent), surely Sheap would be boasting about any such benefits – if there were any?
Gaps exist in Sheap’s information, however, and from my own personal experience as a power station engineer it seems highly unlikely that this project is viable without major subsidy.
A (low interest) loan from the Scottish government is mentioned and energy minister Fergus Ewing is quoted as saying: “Heat is … responsible for nearly half of Scotland’s greenhouse gas emissions, so the imperative to take action is very clear.”
Ewing declares that “… the imperative to take action is very clear” yet he doesn’t mention any subsidy?
The “imperative to take action” may well be “very clear” to Mr Ewing but it is neither the job of the charitable trust to act nor, especially, to subsidise it.
Surely, as a subsidiary of the charitable trust in its current regime of spending cuts, Sheap would not spend £1.6 million on a financially unviable project that will become a drain on customers’ pockets and/or trust reserves?
The Sheap operations manager is quoted as saying: “The primary aim is not to increase the number of households joining the district heating scheme, but to offset some of the oil we burn with a renewable source.”
What, even if it puts up heating costs or reduces trust income?
Key questions need answers:
• What is the price of heating oil in Shetland?
• What subsidy is available to make SHEAP’s investment viable?
• What will be the effect on district heating charges?
• What will be the effect on charitable trust income?
• Is the trust’s priority to burn less oil or to make energy affordable?