Escalating Global Tensions
What the Impact Could be for the Resilience of Rural Highland Communities
While the crisis involving Iran may appear geographically distant from the North of Scotland, global energy and supply systems mean that events thousands of miles away can quickly affect daily life in the Highlands. Oil markets, gas supply routes, electricity pricing and global shipping networks are all interconnected. When instability occurs in one part of the world, the effects can travel rapidly through those systems. For remote and rural communities in the Scottish Highlands, this matters more than it might elsewhere. Geography, infrastructure and long supply chains already make these communities more vulnerable to disruptions in energy and transport systems. The current escalation therefore sits on top of vulnerabilities that already existed. Understanding what may lie ahead requires looking closely at how energy and supply systems actually work across rural Highland communities.
The Highlands Have Very Different Energy Availability and Usage from Urban Scotland
Statistics for the Highland Council area can sometimes create a misleading picture of energy use because Inverness is included in the figures. Inverness is the largest settlement in the region and has infrastructure that resembles other Scottish cities, including access to the mains gas network. Many rural and remote communities across Ross-shire, Sutherland, Caithness and the west Highlands have no gas infrastructure at all. Across the wider Highlands and Islands region around 66 per cent of homes are off the gas grid, equivalent to roughly 136,000 households. In many smaller communities the proportion is significantly higher. For those households there is simply no option to connect to mains gas.
Common Heating Fuels in Rural Highland Homes
Heating instead relies on a mixture of alternative fuels. These typically include:
• heating oil
• electricity
• solid fuels such as coal or wood
• LPG in some areas
Heating oil remains one of the most common systems in rural housing because oil boilers allow full central heating in detached homes and croft houses without requiring gas infrastructure. Across the Highland Council area roughly 30 per cent of homes rely primarily on oil heating, although in many rural villages the proportion is considerably higher. Electric heating is also used widely. Around 40 per cent of homes across the Highlands rely on electricity as their primary heating system. However it is important to understand that fully electric homes are relatively new in many rural communities. Historically, remote Highland homes relied heavily on oil, coal, wood and peat. Electric heating became more common in flats, some social housing developments and newer builds where oil systems were not installed.
Solid Fuels Still Play a Role
Solid fuels have not disappeared either. Coal fires, wood burning stoves and in some areas peat burning remain part of the heating mix in rural homes. While coal use has declined significantly across the UK, it still exists as a secondary heat source in a small proportion of Highland households, particularly in older homes that retain fireplaces or solid fuel stoves.
LPG in the Rural Energy Mix
Liquefied petroleum gas, or LPG, also forms part of the rural energy picture. LPG is typically delivered by tanker and stored in external tanks, much like heating oil. It is used in homes that require gas-based heating or cooking but cannot access mains gas. While LPG represents a smaller share of Highland household energy overall, it remains an important option for some off-grid properties. Taken together, this means Highland communities depend far more heavily on delivered fuels than most urban parts of the UK.
Fuel Poverty in the Highlands Is Already Significantly Higher
These structural differences are reflected in fuel poverty statistics. Around 33 per cent of households in Highland are classed as fuel poor, compared with approximately 24 per cent across Scotland overall. Approximately 22 per cent of Highland households are in extreme fuel poverty, almost double the national average. In remote rural Scotland the situation can be even more severe. Estimates suggest fuel poverty rates can reach around 44 per cent of households in remote rural areas. These figures reflect a combination of factors including:
• colder climate
• older housing stock
• detached homes requiring more heat
• reliance on expensive off-grid fuels
• lower average incomes in rural communities
In practical terms many Highland households already spend a much larger proportion of their income on heating than households in urban Scotland.
Electricity Prices Are Tied to Gas Even Where Gas Is Unavailable
One of the most significant structural issues affecting Highland communities is the way electricity prices are determined in the UK energy market. In Britain the wholesale price of electricity is generally set by the most expensive generator needed to meet demand. In many cases this is a gas-fired power station. This system, known as marginal pricing, means the cost of gas often determines electricity prices even when renewable energy is available. Gas generation still produces roughly 30 per cent of electricity across the UK. Because gas plants frequently set the wholesale price, spikes in global gas prices often translate directly into higher electricity prices. For Highland households this creates a clear contradiction. Many communities have no access to gas infrastructure at all, yet electricity prices still rise when global gas prices increase. In effect, rural households can end up paying higher electricity costs linked to a fuel they cannot even access. This issue is particularly striking in the north of Scotland because the region hosts some of the UK’s largest renewable energy resources. Major hydroelectric schemes and extensive wind generation operate across the Highlands. Despite this, local households do not benefit from locally reduced electricity prices and remain fully exposed to national wholesale energy markets.
The UK Energy System Has Limited Storage Capacity
The wider UK energy system also has structural vulnerabilities. Britain has relatively limited gas storage capacity compared with many European countries. Estimates suggest the UK can store only around 10 to 12 days of gas demand under normal winter conditions. By comparison:
• Germany can store around 90 days
• France can store more than 100 days
Countries with large storage facilities can build reserves during stable periods and release them when markets become volatile. The UK relies far more heavily on continuous imports and global market purchases. When international supply is disrupted, price changes therefore pass quickly through the system. Although gas itself is not widely used in Highland homes, gas market volatility still affects the region through electricity prices, transport fuel costs and wider economic pressures.
The Closure of the Grangemouth Refinery and Scottish Fuel Supply
Another important change affecting Scotland’s energy resilience is the closure of the Grangemouth oil refinery. For decades the refinery at Grangemouth was Scotland’s only crude oil refining facility and produced a significant proportion of the country’s petrol, diesel and other refined fuels. In 2025 the refinery ceased processing crude oil and began transitioning to an import terminal. This means Scotland no longer refines crude oil domestically. Instead, finished fuels must now be imported before being distributed across the country. Although the Grangemouth site continues to operate as a fuel import and distribution hub, the loss of domestic refining capacity removes an important layer of national energy resilience.
Fuel Distribution Works Very Differently in the Highlands
Fuel distribution across the Highlands involves far longer supply routes than those serving major cities. Large fuel terminals and depots are concentrated around central Scotland and other population centres. From there tanker deliveries travel long distances north to supply smaller filling stations and heating oil depots across the Highlands. Remote areas have fewer filling stations and fewer depots, meaning supply chains are longer and less flexible. When disruptions occur within wholesale supply or transport networks, these longer delivery routes increase the risk that shortages or delays will reach the most remote communities first.
Rural Life Depends Far More on Transport
Energy vulnerability in the Highlands extends well beyond heating homes. Daily life in rural areas requires significantly more travel than in urban Scotland. Workplaces, hospitals, schools and supermarkets are often located many miles away from smaller villages. Public transport options can be limited or absent entirely. Fuel is therefore not simply another household cost. It is essential to everyday life. When oil prices rise, the impact on rural communities is immediate. Petrol and diesel costs increase household expenditure while also raising the cost of delivering goods to rural areas.
The Highlands Sit at the End of National Supply Chains
Most food and consumer goods reaching Highland shops travel long distances through national distribution networks. Large supermarket chains typically supply Highland stores from distribution hubs located in the Scottish central belt or northern England. Goods are transported north by road before being distributed to individual stores across the region. By the time fresh food reaches many Highland communities it has often travelled hundreds of miles. Residents frequently notice that best before or use by dates on fresh produce, dairy products and prepared foods are shorter than those available in supermarkets closer to distribution centres further south. Products simply spend more time moving through the supply chain before reaching the Highlands. When transport networks are disrupted or supply chains tighten, communities at the end of those networks often feel the effects first.
The Higher Cost of Living in Remote Rural Scotland
Rural living already carries a significantly higher cost. Evidence submitted to the UK Parliament suggests the minimum cost of living in remote rural Scotland is between 15 and 30 per cent higher than in urban areas. This rural premium reflects:
• higher heating costs
• higher transport costs
• more expensive goods and services
• limited infrastructure
How the Iran Crisis Could Affect Highland Communities
The escalation involving Iran adds another layer of risk to an already fragile system. The Middle East remains central to global energy supply. The Strait of Hormuz carries roughly one fifth of the world’s traded oil and gas. Any disruption in this region can ripple rapidly through global energy markets. When tensions rise, oil and gas prices often react quickly. These price movements can then pass through to:
• electricity prices
• heating oil costs
• petrol and diesel prices
• transport and delivery costs
For rural Highland communities dependent on heating oil, electricity and road transport, these impacts can compound rapidly.
Highland Resilience Must Be Viewed Through a Rural Lens
The Highlands are not a single uniform energy landscape. Cities such as Inverness operate within a very different infrastructure environment from smaller villages and dispersed rural settlements. When statistics for the Highland Council area are presented without context, the realities experienced by remote communities can easily be obscured. For villages and many communities further north face a very different situation from urban centres. Housing is more dispersed, heating relies heavily on off-grid fuels, and everyday life depends on long supply chains and significant travel distances.
A Region Already Living With Structural Vulnerability
Perhaps the most important point is that these vulnerabilities already existed before the current crisis began. High levels of fuel poverty, reliance on delivered fuels, long supply chains and higher transport costs have long shaped the economic reality of rural Highland life. The current geopolitical tensions do not create these vulnerabilities. They expose them. When global energy markets become unstable, the underlying fragility of rural supply systems becomes far more visible. For the Highlands, resilience is therefore not simply a question of energy prices. It is about the structure of rural life itself. Communities that depend on long supply chains, off-grid energy systems and extensive travel distances will always be more exposed when international disruptions occur. Understanding these realities is essential if the needs of remote Highland communities are to be properly recognised in national discussions about energy security, infrastructure and resilience.
