THE publicly owned energy company promised by the Scottish Government must be placed at the “heart of decision-making”, according to an MSP.

The SNP aims to establish a provider by the end of the current parliament in 2021 as part of moves to tackle fuel poverty.

Setting out the plan in October last year, Nicola Sturgeon said energy would either be bought wholesale or generated in Scotland and then sold to householders at “as close to cost price as possible”.

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She said: “No shareholders to worry about, no corporate bonuses to consider. It would give people – particularly those on low incomes – more choice and the option of a supplier whose only job is to secure the lowest price for consumers.”

Proposals on establishing such a body are under consideration by MSPs.

But as the Economy, Energy and Fair Work Committee delivers its recommendations, Gordon Lindhurst, its chair, has called on the Scottish Government to set out how it will deliver on its aims amidst high expectations on cost, impact and the environment.

The Scottish Conservative MSP, who represents the Lothian region, said: “If a publicly owned energy company (POEC ) is to provide cheaper energy and tackle fuel poverty, it must sit at the heart of decision- making and market transition.

“However, in an already crowded market place, we would like to see a clear mission statement on how the company plans to build a sustainable customer base, how it will operate, how it will align with existing initiatives, and what extra value it will add.”

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He raised concerns that the scheme may not be capable of delivering on all aspirations: “With so many expectations placed, there is a danger it ends up pleasing nobody.

However he added: “We hope that will not be the case – for the sake of affordable fuel bills and decarbonisation.”

In a letter sent on Friday, the committee says a POEC must be positioned at the heart of policy making and be “sufficiently independent” from the Scottish Government to avoid breaking anti-competition rules.

The advice, which follows evidence sessions and draws on research commissioned by the Scottish Parliament Information Centre on behalf of the committee, also said the company “would have to compete on equal terms with others” for any public sector contracts.

It cites the example of Bristol Council, which struck a deal with an outside supplier rather than its own Bristol Energy initiative.

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It goes on to state that “public resources could not be used to promote a government-owned supply company in the market” and warn that the Warm Home Discount is amongst issues which could create conflicts of interest.

The paper also reveals that Edinburgh-based non-profit energy supplier Our Power has built up a customer base of almost 30,000 since its foundation in 2015.

The Scottish Government-backed social enterprise – which is owned by social housing providers, community organisations and local authorities – aims to turn a profit by 2021 and currently takes 90% of its electricity from renewable sources.