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Publicly Owned Energy Company

Publicly Owned Energy Company

Background

The draft Energy Strategy Consultation which ran from January – May 2017 included a question on the potential role and remit of “a Government Owned Energy Company to help the growth of local and community projects”. In addition to the consultation a workshop was held, and well attended, on the 27 March 2017 to explore with stakeholders’ first-hand their views on the potential for a Government Owned Energy Company. 

Proposition

On 10 October 2017, the First Minister, Rt Hon Nicola Sturgeon MSP, confirmed the Scottish Government’s intention to establish a publicly-owned not-for-profit energy company by the end of the current Parliament. The working principles, as set out by the First Minister is for such a company to sell energy, whether bought wholesale or generated in Scotland, to customers at as low a price as possible, and in so to offer people more choice, particularly those for whom fuel poverty is a key concern.   The Scottish Government is committed to having a Company operational by the end of this current Parliament (March 2021).

Activity

The Scottish Government engaged Ernst & Young LLP (“EY”) to advise on the preparation of an independent Strategic Outline Case for the development of a Publicly Owned Energy Company. This provided an opportunity for the options for the establishment of a Publicly Owned Energy Company to be viewed through a commercial lens prior to any final conclusions being presented to Scottish Ministers.  This approach will ensure that all early decisions taken support the development of a viable and market compliant solution. 

The EY advice has now been received and is contained in their report dated 29 March 2018 which can be accessed in full below. Attention is drawn to the transmittal letter included at the front of EY’s report which explains that the report was prepared solely for the use of the Scottish Government. Accordingly EY disclaims any responsibility or liability to any other person relying on the report.

Next Steps

As announced in December, we are committed to ensuring public consultation as part of the development process and will look to start this engagement later in the year.

Future Consultancy Support

If the Scottish Government needs to procure future goods or services in support of the Publicly Owned Energy Company, we will do so in compliance with all applicable rules.  This might include new competitions advertised through the Public Contracts Scotland Portal (here) or pre-existing contracts and frameworks.

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Downloadable document:

Publicly Owned Energy Company: Strategic Outline Case Publicly Owned Energy Company: Strategic Outline Case [PDF, 1833.1 kb: 05 Apr 2018]
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