THE UK Government is under increasing pressure to overhaul the energy system in a plan that proponents say could save up to £18 billion a year.

The SNP have joined trade body Energy UK and the Scottish Greens in calling on Westminster to decouple renewable energy prices from the cost of gas.

According to Energy UK, this would save the average household around £250 a year while saving businesses up to a whopping £11bn in the same period.

Currently, unit prices for all forms of energy are tied to gas prices which have risen dramatically in recent years.

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SNP MP Alan Brown said this means that consumers using domestically-produced renewable energy, which is cheaper and more environmentally friendly than fossil fuels, are being unfairly impacted by soaring gas prices.

The Kilmarnock and Loudoun politician has written to Minister for Business, Energy and Industrial Strategy Grant Shapps urging him to overhaul the energy system.

He urged the minister to act immediately to untie the price of renewables from the price of gas.

The National: The SNP said it was unfair that those using renewable energy are paying high prices due to the skyrocketing cost of gasThe SNP said it was unfair that those using renewable energy are paying high prices due to the skyrocketing cost of gas

Commenting, he said: “One way the UK Government can ease the pressure on households and businesses is by decoupling the price of retail energy from expensive gas bills.

“Right now, the unit prices for all forms of energy are pegged to gas prices, meaning that those using renewable energy to power or heat their home, which is much cheaper, are still being adversely affected by rising gas prices.

“The UK Government must urgently fix this unfair system. Doing so could lower energy bills by up to £18 billion a year, and benefit both businesses and households, according to Energy UK.

“Beyond that, it must also address the unjust system that sees consumers in Scotland pay higher standing charges.

“It is ridiculous that this is even the case.”

The National:

Scottish Greens MSP Mark Ruskell told The National that renewables are being "held back" by "dirty energy".

He said: "With the price of gas soaring and the planet burning, it's more vital than ever that we make the transition from fossil fuels.

"Renewable energy is the cheapest and cleanest energy, but it is being held back by a system that links it to the cost of the dirty and polluting energy sources that we desperately need to leave behind.

"Our energy market is broken. If we are to have any kind of sustainable future then it must be fundamentally restructured to ensure that it works for people and planet rather than shareholders."

Frazer Scott, CEO of Energy Action Scotland, which campaigns for an end to fuel poverty, told The National it supported the call.

He said: “Scotland's households need and deserve a fairer energy system at the same time pricing of energy is in need of radical reform.

“Decoupling renewable energy generation from the high price of gas or indeed nuclear has the potential to reduce costs.

The National: The UK's current system means the price of renewable energy is linked to the cost of gasThe UK's current system means the price of renewable energy is linked to the cost of gas (Image: PA)

“Scotland is energy rich yet many of our communities derive little or no benefit from renewables generated on their doorstep. With over 1 in 3 households in fuel poverty we need to see a fairer pricing structure with people at its heart.

“Unaffordable energy will cost lives this winter and beyond, placing an intolerable burden on health services. But warm words do not heat homes.

“This is a crisis of pandemic proportions that demands to be treated and prioritised in an equivalent manner.”

An Energy UK spokesperson told The National: “The current energy market doesn’t allow customers to fully benefit from the cheapest form of electricity; domestically produced low-carbon generation.

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"This proposal could reduce bills by up to £18 billion per annum, delivering much-needed cuts to bills for both households and business customers.

“By giving generators the chance to secure a longer-term agreement with lower returns in place of selling electricity at wholesale market prices, this scheme would be a significant first step to decoupling gas from retail electricity prices.

"Removing the link between gas and retail electricity prices will be complex and take time, but this solution provides a quick fix for up to 40% of our generation capacity”

“Much will depend on how the details of the scheme, but with gas prices likely to remain high for some time, we are confident that it can deliver significant savings for customers next year.”  

The UK Government was approached for comment.