Tuesday 20 October 2015

High energy bills, unfair fuel prices and people living in cold homes having to choose whether to eat or heat their homes is increasingly common.

Now Sheffield City Council has announced that it is exploring options to set up a local energy company to tackle these issues and provide a better deal for residents.

This could take a number of different forms – from a new company created to sell energy in the local area, to a partnership with an existing company looking to grow their business. A Sheffield energy company could also help increase the use of locally generated renewable energy which is low carbon.

A small number of local energy companies have already been set up by councils across the country. Nottingham Council opened its own energy company – Robin Hood Energy – this September, and one in Bristol is expected to launch later this year. Cheshire, Peterborough and Southend-on-Sea have also set up lower-cost initiatives by working in partnership with an existing community energy company.

The council is now looking at the different options, their costs, financial impacts and how they might operate in Sheffield. This follows the opening of Sheffield Money this summer which the council helped set up to provide residents with an affordable alternative to high-cost credit and unscrupulous lenders.

An estimated 15 per cent of households in Sheffield (34,000) live in fuel poverty, with children living in cold homes being twice as likely to suffer from conditions like asthma and bronchitis. Research by competition watchdog, the Competition and Markets Authority, shows that people are being overcharged by £1.2 billion when comparing the highest and lowest energy charges, with people on pre-payment meters paying up to 10 per cent more than standard rates.

Councillor Mazher Iqbal, cabinet member for public health and equality, said: “Some families in Sheffield struggle to make ends meet and have to make stark choices about whether to eat or heat their homes. This is appalling. It puts terrible pressure on people and only makes a bad situation worse.

“We are already working hard to tackle this through the Big Sheffield Switch but more is needed. We want to get a better deal for people.

“We’re looking into how a local energy company might help tackle the issues of unfair prices and rising energy bills, through cheaper tariffs for all residents. We don’t yet know what the investigations will show but we want to work with our city partners on this and are committed to looking at all of the options. As a city, we opened Sheffield Money to help people escape the trap of unfair lending and we are bold in our approach to tackling poverty.”

An outline business case is being carried out by the council over the next few months. A more detailed investigation will be carried out next year depending on the findings.

This work builds on the council’s Big Switch campaign which it runs twice a year to help residents switch onto cheaper energy deals. Figures from the first four campaigns show nearly 3,500 people have switched tariffs and saved an average of £228 each year, with £825,000 saved in total.

More than 2,750 people have already signed up to this year’s Big Sheffield Autumn Switch. The cheapest tariff through the campaign shows an average saving of £287 on an average yearly bill of £1,083. People can sign up to receive this deal until 16 November by visiting: www.bigsheffieldswitch.org.uk