Thursday, 12 August 2010


Even though many of us will be enjoying the summer, some of us will also be faintly wondering about what our winter fuel bills will be like if we have a bad winter. Some of us may be thinking about making a stark choice between heating or eating this winter. Energy supply wise, we are now in the situation where we are now even more dependent upon imported gas from either unstable regions or dubious suppliers than ever before, and we the customers face unnecessarily expensive bills.

As a matter of urgency the Westminster Government, the Scottish Parliament, the National Assembly and the Northern Ireland Assembly should work with the Irish Government to make these islands entirely self sufficient via renewable non market driven energy resources rather than pursing the dubious and costly (potentially in more ways than one) nuclear alternative that is particularly favoured by Whitehall civil servants.

The renewable energy sector can and should play a major role in creating more sustainable green energy jobs in Wales and elsewhere in the UK. If we can develop a flexible self-sufficient energy development strategy that actually encourages decentralised microgeneration schemes and then actually implement it then we have a fighting chance of creating jobs, useful new skills and will be able to bootstrap the economy out of the recession, as helping consumers and securing a stable safe energy supply.

As part of this process, we need to create a decentralised power generation system, which will create sustainable long-term jobs for local people, not damage the environment and contribute to providing our local communities with a long-term sustainable economic future. We can create more sustainable green jobs with exportable technology e.g. plumbers can install solar water heating and other professionals can install solar panels, micro-generation, biomass systems, green sanitation and water use can all contribute to the sustainable growth of our economy.

However, When it comes to energy supply in these isles, we are subject to the less than tender mercies of the so called 'free market', I say that because what we have is a virtual monopoly on energy supply in the UK. This is a direct result over the last eleven years of so or the departure from the commercial scene of a significant number of the energy supply companies - they fell from twenty two in number to six.

Now we have been told don't worry about it, that's the way the market works, and besides everybody took advantage to buy cheap shares in all the privatised utilities didn't they? Many people might have done so, but, how many people still have them or shares in their successor companies. By way of experiment at one of the Westminster election hustings (in Trelech) I asked that very question - out of well over 100+ people present only one person raised their hand. The only real beneficiary in the medium term was the City. Now the free marketeers will tell us that this was a good thing - I beg to differ the only real end result of the privatisations was that the ever richer minority in the City (and some of their friends in the Palace of Westminster) got richer at our expense.

Anyway, as I said, Free market, I think not, what we have is less than a £30 differential between all of the energy supply companies, which works out to be no more than a few pence a week difference in bills. We are all paying the price, and future generations will continue to pay the price of the economic consequences of an energy cartel which brings minimal benefit to hard pressed energy customers and maximises it's profits and which feeds the UK government impressive amounts of tax.

The Energy companies who have reaped vast profits over (500% between 2003 and 2008) were pretty quick to blame rising oil and gas prices, and even quicker to rake in the profits, as the average annual dual fuel bill rose from £662 a year in 2005 to 1,048 in 2007. The New Labour Government was pretty happy to rake in the extra tax revenues and ignore repeated calls for a windfall tax on excessive profits and the Energy companies were equally slow to pass on any reductions in energy costs to their customers – the only real losers in this pretty picture was us, the unhappy energy customers.

The then New Labour Government ignored repeated warnings that it was setting the UK on a path towards higher prices and blackouts. Over the next six years almost all of our old nuclear reactors, along with nine major coal and oil-fired power stations, will be closed, with nothing ready to replace them - now that is something to think about.

Now it's not all New Labours fault, that would be too easy and too simple. This mess has been along time coming, the real culprits are the Conservatives. Conservative complicity in the headlong dash to gas in the 1980’s was bad enough, but, things were compounded by a real and basic failure in strategic energy planning something that was made worse by the then New Labour Government's perverse decision to half-heartedly look at developing diverse reliable alternative energy sources.

Back in October 2009, the Tory Energy Spokesman, Greg Clark has said that the "cartel" of the big 6 energy firms would be referred to the Competition Commission by an incoming Conservative Government. He also condemned the unacceptable lag between the cost of wholesale gas prices and household energy bills - noting that customers were on average being charged some £74 pound too much for their energy per year.

Many people, at the time, could see the benefits of an 'independent' investigation into the Energy companies refusal to pass on reductions in wholesale energy prices to customers and welcomed the promise of a long overdue 'Energy Revolution' to overhaul the energy sector billing structure and charges. All good stuff, but, and don't get me wrong here, this all sounded great, but, it does seem to have gone awfully quiet over there (in Government).

Also if my memory serves me correctly wasn't it a Conservative Government that was responsible for starting the whole sorry mess in the first place by privatising the energy market in the first place, throwing any rational energy pricing structure upon the questionable whims of the 'market' by allowing the newly privatised energy companies to price gouge customers in the first place? One reason why it may have gone quiet is that the energy cartel helps to feed the fat wallets of their Tory chums in the City?

By the look of it and energy prices are set to rise once again and while no one is disputing that the six main energy suppliers have been ever so slowly (in most cases) reducing their prices since the beginning of this year, energy bills are still too high. Consumer Focus research suggests (in October 2009) that current gas bills should have been at least 7.4% cheaper (some £60.10 annually) and electricity bills should have been at least 3.1% cheaper (£13.80 annually). I suspect that the energy companies will move pretty swiftly to raise our bills if energy prices go up again.

Now the reality is that little has changed, vast profits are still being made by the energy companies. Customer Focus's research showed the reality, that the energy companies are pocketing £1.6bn extra, despite the belated passing on of some energy cost reduction to households, little has changed and if energy prices continue to fluctuate then once again millions of households may yet struggle to make ends meet this winter.

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