Link to this page: http://www.socialistparty.org.uk/issue/522/3833
Explosive mood on gas profits
BRITISH GAS has announced a 500% rise in profits for last year. This rise is grotesque enough but the announcement, just weeks after they put their prices up by 15% for 13 million customers, made people very angry.
4.5 million people are estimated to live in fuel poverty (spending more than 10% of income on basic fuel costs) in Britain. These new prices, combined with the sharpest recorded rise in food prices and real-term wage cuts, will make living costs hard to handle for millions of workers.
The price rise is being blamed on rising wholesale gas costs but this burden is being carried wholly by us and not by Centrica, the owner of British Gas, or its shareholders.
A report by independent analyst Cornwall Energy Associates, found about £2.3 billion of the £8 billion increase in prices by gas companies cannot be accounted for, in other words it's profit.
The price rise was virtually uniform across the "Big Six" companies dominating the energy market. Ofgem the 'regulator' is launching an investigation into alleged price fixing, although the last 15 inquiries have barely criticised the energy companies.
Clearly all the arguments that privatisation means a more competitive and efficient energy market have proved incorrect. Privatisation has meant uncontrollable price rises alongside record profits for big business.
If the energy suppliers were brought back into the public sector and run by and for workers and other energy users, affordable fuel could be provided for the mass of people while also safeguarding the environment.
In The Socialist 27 February 2008:
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