Shetland’s MP has called for an “island tariff” in recognition of the higher energy needs in his constituency.
Alistair Carmichael made the comments after Ofgem’s announcement to cut the energy price cap.
While the regulator’s reduction brings the average price down to £1,923 for a dual household – a saving of £151 – Mr Carmichael said customers in the isles will likely pay more. The new cap comes in from 1st October.
Mr Carmichael said: “While any drop in the energy price cap is welcome, the last year of rocketing prices makes calling it a “cap” a joke in poor taste.
“We all know that the energy market is not fit for purpose, either for families’ bills or for our wider need to improve energy efficiency and generate more renewables.
“Until we take a grip of that seriously then price cap changes are just tinkering at the edges.”
Mr Carmichael said price caps meant little to people in the isles where energy requirements were far higher.
“Whether it is differentiated tariffs for areas with higher fuel poverty or outright decentralisation of the system, Ofgem needs to recognise that one-size-fits-all does not fit the isles,” he added.
“Now is the time to bring back social tariffs for energy.
“More to the point, the acceptance of the need of a social tariff by Ofgem surely opens the door to a geographical tariff – like an islands tariff of the sort we have been calling for here, which would take into account not just income but the reality of our climate.”