Friday, 6 February 2009

Oil price plunges but not our energy bills

Wednesday's Herald points out that oil is now trading at $40/barrel [ 'Oil falls on more economic bad news'].
Like millions of other Scots families we've just received our gas and electricity bill for November/December which unlike the oil price is still sky high.
I well recall Scottish Power and the other energy companies citing oil at $145 per barrel as the reason for their unprecedented price increases last autumn.
As a result of their exorbitant bills Energywatch estimates 5.5million households now find themselves living in fuel poverty. And Scotland suffers disproportionate pain in this regard as the Scottish Government well knows. It announced in October that 36% of households were in fuel poverty. To fall into this unwelcome category a household must pay 10% of its income in fuel bills. In Scotland in 2008 an astonishing 10% of households paid 20% of their income to power companies. And to add even more insult to injury those on prepayment meters, usually the poorest, are paying the highest tariffs of all. How on earth did things come to this? And how can these multinational energy corporations justify sky high bills when their basic raw material now costs almost one quarter of what it did 6 months ago?
It is not difficult to see why there is considerable contempt for the energy companies and indeed with an ineffectual government as people struggle with the severest winter in years and with the highest gas and electricity prices ever.
There is a widespread view that this industry is out of control and ought to be back in public hands. Then the poorest would be on the cheapest tariffs and not the most expensive. Then responsibility for providing heat and light to everyone, particularly in the dead of winter would not to be left to faceless multinational corporations who repeatedly put their profits before the needs of the population.

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