London's Mayor needs to step up plans for a not-for-profit energy company if he's to have a real chance of cutting fuel poverty and emissions, argues Caroline Russell AM.
Londoners will be left out in the cold – and out of pocket – if Mayor Sadiq Khan fails to stick to a manifesto promise of starting a not-for-profit energy supply company to alleviate fuel poverty and help generate more green energy.
With increasing pressure on cities to take action on climate change, this could provide the Mayor with an essential tool to boost renewables.
Bringing in a serious competitor, for the benefit of Londoners instead of shareholder profits, will force the ‘big six’energy companies to bring down their extortionate prices.
Yet the signs are that the Mayor is getting cold feet. He’s delaying instead of delivering on his promise to get Londoners the best deal for their energy.
In January I suggested a £1.5 million budget boost to set up Energy for Londoners – an amount that mirrors investment made by Nottingham Council when they set up a similar not-for-profit Robin Hood Energy Company. However the Mayor didn’t budge on his budget, and the investments so far haven’t been anywhere near enough to get a company up and running.
‘Energy for Londoners’ offers a real opportunity to do something innovative in London by having a publicly-run energy company that could reinvest its profits in skilled jobs, renewables and our low-carbon future. This is only possible if the company if fully licensed.
I have been pushing the Mayor on this. I asked him at Mayor’s Questions last year to confirm that his company would be fully licenced, so it could directly supply London homes, businesses, hospitals and schools.
He replied ‘that’s the idea’ and went on to talk about learning lessons from Nottingham, Bristol and Scotland. This gave me confidence the Mayor was keen to see the real benefits that a fully licenced company would offer.
But savings for customers and investment in green energy are in jeopardy if Energy for Londoners is down-graded to a ‘white label’ company – meaning it will carry the Mayor’s branding but be run for profit by a third party, leaving less money in the pot to lower future tariffs.
Switched On London recently revealed that Londoners could save £159 on an average dual fuel bill because Energy for Londoners would be able to set its own base tariff of £970.
As energy bills go up and customers feel ripped off, we desperately need a fairer alternative.
Only a fully-licensed company gives the Mayor power to set different rates for people in fuel poverty and competitive rates that challenge the ‘big six’. I backed this option when the London Assembly environment committee looked at the Mayor’s role in domestic energy and fuel poverty in May.
The results of a feasibility study backing one of these options were due in spring but we’re still waiting – the Mayor has pushed back the announcement to coincide with the release of his environment strategy some time next month.
We aren’t asking for the impossible – other cities have shown it can be done. Robin Hood Energy in Nottingham, Bristol Energy and Our Power in Scotland have established similar schemes.
When I raised these companies with the Mayor last June he told me ‘that is not the limit of our ambition’. However that was a year ago, and we haven’t seen any progress yet.
The Mayor really needs to turn up the heat.
Caroline Russell is a Green Party London Assembly Member. Follow her on Twitter.
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