While the Big Six’s profits from us increased fivefold from 2009-2013, one in four people struggle to pay their extortionate fuel bills
Yesterday a new report once again made it abundantly clear that the corporate-controlled energy system is a catastrophe for the UK. The report by the Competition and Markets Authority (CMA) shows that the Big Six energy companies are charging their most loyal customers up to £234 extra a year.
As usual the people hardest hit by this are also the people most vulnerable in cold winters: pensioners, disabled people, single parent families, and people on low incomes.
The energy market has failed. And it has failed the hardest for the people who need energy the most. Yet Ofgem, the government regulator of the energy utilities, sees no other solution to the problem than providing even more market.
In Ofgem’s logic the problem is the Big Six’s virtual monopoly on energy provision. Therefore splitting up the big energy companies into smaller entities would be the only change necessary to right the wrongs of privatised energy.
It doesn’t take more than a quick look at the current situation for millions of people in the UK to see that splitting up the Big Six doesn’t even begin to address the problems of the current energy system. While the Big Six’s profits from us increased fivefold from 2009-2013, one in four people struggle to pay their extortionate fuel bills.
In the past few years fuel bills have risen eight times faster than our wages and Which? have calculated that our bills were £145 too high last year because energy companies failed to pass on savings from falling wholesale energy prices to consumers. That’s just the financial tip of the iceberg of problems with our energy system.
Every year thousands of people die in cold homes because they are unable to afford adequate heating. And it is estimated that more than one in five of us has had to make the difficult choice between heating and eating this winter.
Break up the system, not just the Big Six
The corporate-controlled energy system has not just made us all worse off by increasing our energy bills in general; it has also constructed a system where the poorest consumers subsidise the bills of the richest. People on prepayment meters pay more for their energy and people in debt pay more again.
Every day the Big Six break into people’s homes across the country to impose more prepayment meters and more than four million people are already in debt to their energy provider.
Yes, maybe splitting up the Big Six could provide some benefits for some of the richer part of the population who’re paying their bills via direct debit. But people forced onto prepayment meters and people indebted by energy bills and unable to change providers have nothing to win from this exercise.
Splitting up the big energy companies is not going to provide any support for the people who really need it – or even stop the exploitation of some of the most vulnerable groups in our society. Yesterday’s report from the CMA is just another proof that the ‘free’ market is not bringing down our bills, but instead contributing to more inequality and fuel poverty.
For everyone who wants a more equal society and for everyone that wants to see an end to fuel poverty, the only solution is an end to the corporate-controlled profit-driven energy system.
Taking back power
The solutions to our energy problems are already being created here in the UK and across the world. Instead of looking to big business for solutions, we should look to Germany where the people of Hamburg are taking back control of their energy. We should look to Indonesia and Costa Rica where rural energy coops are providing green, affordable energy and jobs to local communities.
If we want to create an energy system where everyone can access the energy they need and where energy does not destroy our climate, we must take back power from big corporations. More than two thirds of people in the UK want to bring back energy under public control. If our ‘representatives’in Westminster cannot see the need for real change of our energy system, we need to show them the way.
Join the fight for a democratic energy system at www.fuelpovertyaction.org.uk.
Morten Thaysen is part of Fuel Poverty Action and Reclaim the Power. He also works for Global Justice Now.
49 Responses to “Privatised energy has failed – we need to take back the power”
madasafish
Yes: money is unimportant.
No wonder socialism does not work., The supporters of it either think money is unimportant or don’t understand it.
Money is a “trifling” matter. See what happens when you don;t have any.. Greece is a horrible example. But no doubt it’s “trifling”…
littleoddsandpieces
The only way to get nationalised utilities with affordable energy for all is to vote for it, and none of the so-called big parties offer bringing back from privatisation the energy companies.
Renationalising power companies would cost a lot.
But there is a way that people and government can get round buying power from privatised companies altogether and so make them unprofitable.
And that is self generation, which was where electricity came from in the beginning.
See how at:
http://www.anastasia-england.me.uk/free-energy-wish-list/4588115250
But again no so-called big parties would have the political will for this.
There are alternatives to vote for out there in this general election, which is the best election for small parties due to it going to be the lowest voter turnout in UK election history.
Kevin Stall
And government run energy was so successful? Wasn’t there a serious problem with brown outs and energy short falls? Yes Coop energy is good and there is no reason they couldn’t compete. The main thing is to keep it our of government hands. The worse management in the world is government run. They are inefficient and tend to politicize everything and ruin it. ,
ForeignRedTory
Piffle. Taxation. As amply explained.
ForeignRedTory
These derivatives are an insurance against fluctuations. So far so good. Unfortunately, as recent History reminds us again, this kind of insurance does involve placing burdens from private to public shoulders externalisation of cost. Hence, we issue a levy as compensation.
Yes, me bucko: it is that simple. The costs will once again be internalised.
‘ Simply put, profits can be quite low’
That is no excuse for the current externalisation of costs.
‘Transaction taxes might be due, for instance, only on short-term holdings’
I think that is a silly paradigma. Remember the basis of taxation: if money changes hands, we, the Fiscus, get a cut. If assets can be measured on the balance sheet, we, the Fiscus, get a cut.Since there is no property* without the consent of the State, we insist that the State has a lien on any form of assets, fluid or fixed. Property of any nature or description exists only at our pleasure.
*nor any other kind of right. To quote the libertarian Bentham: natural rights are nonsense on stilts.
The length of the holding is no specific parameter in this case.