Carmichael renews call for islands tariff as energy crisis deepens

Orkney and Shetland MP Alistair Carmichael. Photo: Parliamentlive.tv

A call has been made for greater government assurances over the ongoing energy crisis.

Isles MP Alistair Carmichael says a reassessment of the role of the energy regulator Ofgem was required.

That, he said, was needed to help prepare for the growing instability in the energy market.

But Mr Carmichael has also pointed to Shetland’s key role in energy production as further evidence of the need for a specific isles tariff.

Several energy firms have ceased trading in recent days due to the challenging conditions, although Ofgem has said any customer of a company that closes will not lose coverage.

Speaking in Parliament, Mr Carmichael raised questions over the implications for the exploitation and extraction of gas within the UK continental shelf.

Responding for the government, business secretary Kwasi Kwarteng said: “As far as 2020 was concerned, 48 per cent of our natural gas came from the UK continental shelf, so that’s clearly a strong, sustainable source of gas into this country.

“Gas is a transitional fuel, it’s something where in our pursuit of Net Zero by 2050, that’s something that we want to transition away from, and that’s why we are developing carbon capture and hydrogen as well.”

Mr Carmichael later said: “While gas supply itself is less of a direct issue for the isles, the uncertainty this week has been a timely reminder of the role we play in energy supply for the whole country – still more reason too that we need proper consideration of an isles energy tariff to fight fuel poverty going forward.”

He added: “First and foremost we need the government to give a sense of stability. People are understandably nervous about rising energy costs, particularly as the colder season starts to draw in. We know that energy firms are coming under pressure but their customers should not lose out as a result of any company closures or volatility.

“Whatever the immediate causes, there is clearly a long term issue with the regulation of the energy market – we need a rethink of the way the market works – and Ofgem’s remit to act – to anticipate and mitigate these sorts of events.”