The ‘lottery’ of prices in the unregulated LPG market has been attacked, amid fears that nearly 70% of adults in Argyll and Bute face fuel poverty.
People who have to rely on LPG or oil have missed out on the price cap announced by Liz Truss’s government – instead being offered a one-off payment of just £100.
And households on the Rosneath Peninsula and Arrochar areas have been quoted renewal prices ranging from 49p to 97p a litre.
In one case occupants of a semi-detached house were quoted 49p, while their next-door-neighbours – in the same building – were simultaneously quoted 80p by the same supplier.
The council has called for the government to take action including a price cap on oil, LPG and solid fuel, while MP Brendan O’Hara has said people could die this winter because of fuel prices.
He branded the £100 payment ‘frankly insulting’, adding: “Reports of neighbours, particularly those sharing the same building, being charged wildly different prices for the same LPG product are inexplicable, and I am extremely concerned that LPG suppliers could be operating a lottery on how much customers are going to be charged.
“I have repeatedly called on the UK Government to introduce an energy price cap for those households which do not have access to mains gas supply and to give OfGem regulatory oversight of the LPG and heating oil market in order to protect off-gas grid customers from skyrocketing prices, cartelisation and possible profiteering.
“Having been made aware that this practise is happening, I have now written to the all the main gas suppliers in the constituency, including Calor, raising my concerns and asking them to explain exactly why this is happening.
“Depending on the response, I will also raise this issue directly with the energy minister when I return to Westminster next week.”
Residents have reported prices for bulk tank LPG of up to 85.5p per litre in Portincaple, 87p in Rahane, 97p in Clynder, 73.5p in Portkil, 67p in Tarbet and 80p in Kilcreggan. Suppliers were Calor, Avanti and Flogas.
Many people said their original suppliers had offered greatly reduced prices – by up to 23p per litre – after they had threatened to switch to another company, though this is now becoming less common.
Argyll and Bute Council is set to call on the government to help tackle the cost of living crisis by taking four key actions:
- To urgently provide information on funding for people who do not get their energy through typical means: 50% of Argyll and Bute households are non-gas compared to 14% of all Scottish properties.
- To apply price caps to oil, LPG and solid fuel to ensure all households are given the support they need to heat their homes.
- To remove the variable standing charge rate that compounds the already higher costs for households in remote and rural areas. This, the council says, must be changed to a uniform charge.
- To deliver equity in all support for the cost of living and fuel cost crisis by making sure that support measures are pivoted to take account of the additional costs of remote, rural and island living.
In a briefing for tomorrow’s full meeting of the council, executive director Kirsty Flanagan said: “The on-costs of living in our communities range from 13% to 185% above costs in urban UK areas.
“Because of this, and issues of heating fuel and housing types, nearly 70% of all households in Argyll and Bute are at risk of fuel poverty or extreme fuel poverty.
“This is a great part of the world to live, key to the economic success of Scotland and the UK more widely.
“However average income is lower, costs are higher.”
A spokesperson for Calor, which offered the dramatically different prices to two parts of the same house, said: “There are a number of factors that go into our pricing which means that customers pay different prices for their LPG from us; this might be linked to their usage or if they benefit from being on a fixed price deal or an introductory price if they have recently switched to us from another supplier.
“In accordance with competition rules, customers enter into a two-year contact with us.
“After that time customers can continue on their existing terms, renew with us, or terminate on 42 days’ notice and are then free to switch to another supplier and find a new deal.
“The LPG, and wider off-grid energy market, remains a competitive one. We would encourage any of our customers to speak to us if they have any concerns or questions relating to their bills.”
A spokesperson for Avanti said: “When providing a quotation there are many factors taken into consideration such as the current wholesale LPG market, operational costs, etc.
“All domestic LPG agreements are for a two-year term, usually we are able to offer a 12-month or 24-month fixed price option depending on the offers available and the customers preference.
“A 12-month fixed price provides security for the first year of the agreement, then during the second year the price is variable and will move in line with clause 6.5 of our terms and conditions.
“A 24-month fixed price is usually a slightly higher pence per litre, however the price is secured for the full two-year term.
“Our quotes are valid for five working days at a time to ensure they are in line with the ever changing wholesale market.
“Our terms and conditions do not include surcharges unlike some of our competitors, a fixed price with AvantiGas truly does mean fixed and you will not see your price increase during a fixed term.”
Flogas did not respond to a request for comment.
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