EXIT STAGE LEFT PURSUED BY SUBSIDY!

A member of the Big 6

If you are searching for material to build the character of a pantomime villain then perhaps you need look no further than the members of the big six energy cartel, who are busy squeezing every ounce of profit out of their customers (most of us) when not flogging off free low energy light bulbs, etc. With that in mind the news that Centrica, who own British Gas owner reported a rise in half-yearly profits, following the unusually cold winter boosted gas consumption should come as no surprise. Centrica's adjusted operating profit increased by 9% to £ 1.58 billion pounds in the six months up to the 30th June, rising from £ 1.45 billion pounds for the same period in 2012.

Amidst the statistical wizardry and smoke and mirrors that passes for energy profit related statistics, the  residential arm (of British Gas) saw its profits rise 3% to £ 356 million pounds, up from £ 345 million pounds one year ago. Like all the other cartel members last November (2012) British Gas upped its energy prices by 6% - basically because - in their largely unregulated farce that passes itself off as the ‘free energy market’ – they could. The news of Centrica's results came a day after EDF (the French energy company) announced that its UK pre-tax profits were some of £ 903 million pounds.

Interestingly enough, just before the profits were announced, House of Commons, Energy and Climate Change Committee (ECCC) realised a report which said that Ofgem (the Energy regulator) is not doing enough to make sure that energy company profits are transparent. MPs stated that the watchdog was "failing consumers by not taking all possible steps to improve openness". The committee also noted that "working out exactly how their profits are made requires forensic accountants".

Energy Profits before People?

The ECCC believes that Ofgem should force energy companies to standardise their bills to make it easier for consumers to compare the value for money of different energy providers. They also believe that it should be possible to break down the total cost of the bill into its components, i.e. wholesale energy prices, supply costs, the cost of implementing government energy policies, operating costs, and profit. And that consumers should be given details of price changes in pounds and pence, and not just in percentages

At the same time EDF stated that it was pulling out of the US nuclear power market because of the widespread availability of shale gas. This later announcement should come as no surprise, as at the end of the day it comes down to chasing easy money (and making excessive profits) when faced with a complicated and pretty much free energy market (one literally awash with resources) the cartel members will tend to back off seeking permanent subsidies (easy money) which make farcical any suggestion that the UK energy market is neither free or open for completion.   

MAKING THE RIGHT DECISION

The news that the latest sets of questionable plans for a £25 billion pound barrage across the Severn Estuary have been kicked into touch by MPs at Westminster should be welcomed. The House of Commons' Energy and Climate Change Committee criticised a "lack of information and noted a perceived lack of transparency" about the proposal.

The MPs stated that the case for the barrage is "unproven" and that Hafren Power had failed to provide robust and independently verified evidence of the economic, environmental and technological viability of the project. The MPs were warned about the potential of job losses in nearby ports, and came to the conclusion that the barrage scheme did not provide a solution to meeting renewable energy targets and it should not go ahead in its current form.

Hafren Power wanted to build an 11-mile barrage between Lavernock Point near Penarth, Vale of Glamorgan, and Brean near Weston-super-Mare, Somerset. In their report MPs said Hafren had failed to make the case that it would be good for the economy or the environment.

This is a sensible decision on the part of MPs in Westminster should, mean that the way is clear to consider more sustainable less environmentally damaging energy schemes. There are plenty of potential options out there including tidal lagoons (as proposed for Swansea Bay), tidal fences and wave power projects which could produce far more energy over a far longer period (and generate sustainable jobs).

When it comes to generating energy and jobs (here in Wales) it is well worth noting that both New Labour and the Conservatives failed to honour their Welsh general election manifesto promise in 2011 to increase the 1 MW limit for off-shore and 50 MW for on-shore threshold for planning for energy projects – something that does not help us here in Wales. This failure effectively threatens to prevent the development of potential energy schemes above that threshold as they have to be decided in Westminster rather than in Wales.

Back in January 2012, Plaid MP Jonathan Edwards called for energy powers to be transferred to the Welsh Government; his bill would have given the Welsh Government powers over energy generation in Wales. The bill (which was blocked by Labour and Conservative MPs, defeated by 239 votes to 44) would have ensured equality with Scotland and Northern Ireland and would have meant that Wales would have been better placed to fight fuel poverty with responsibility for our own resources.

I have for some time had serious concerns about any proposed Severn Barrage, it does not generate enough energy over a long enough period to justify the cost and it would be environmentally damaging. A more logical solution would be to build tidal lagoons, the one proposed for Swansea Bay would be ideal to test out the technology. Previous attempts to develop this technology (here in Wales) have been repeatedly stalled and delayed by a hostile Department of Energy and Climate Change (DECC) and then powerless (but now vision-less and clueless) Welsh Government.

The last thing we seriously need to do is limit the amount of sustainable energy we can develop, we need to maximise the period of generation well beyond the 3 hour energy pulse offered by all previous incarnations of the barrage. A combination of tidal lagoons and other energy schemes could offer release energy for a far longer period than 3 hours and minimise any damage to the environment. By using a variety of options we could generate sustainable jobs and make Wales a world leader in developing the energy generation technology.