Bills are threatening to rise for households in the island due to increases in global oil prices. Alderney generates all its electricity by burning diesel and so there is no respite from rising prices for islanders.
Alderney’s Policy & Finance Committee has called the move a ‘temporary fuel cost relief subsidy’. The money will come from the States general revenue reserve and will be paid directly to Alderney Electricity, which will then apply a discount directly to customers’ bills.
The subsidy will only apply where the Brent crude oil price exceeds $100 a barrel at the time AEL purchases fuel.
P&F chair Jeannie Cameron said recent rises in global oil prices had the potential to place additional financial pressure on households and businesses at a time where they are already managing increased costs.
She said the temporary measure provided a level of protection against exceptional fuel price increases while ensuring that public funds are only used where they are genuinely needed.
‘The subsidy has been carefully structured so that it only applies under clearly defined circumstances and is directed solely towards the fuel cost element of electricity bills. Unlike Jersey and Guernsey, Alderney does not have a cable supplying electricity from France and diesel fuel is required to generate it. The committee recognises that this temporary subsidy complements, rather than replaces, AEL’s continuing work to secure the most competitive wholesale fuel procurement arrangements available.
‘Reducing underlying fuel costs remains the most effective long-term way to minimise future electricity costs for consumers.’
The temporary measure will be applied from the start of this month and will last until the end of the year unless the committee decides otherwise.
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