Oil rig Photo: Jan-Rune Smenes Reite/CC
Oil rig Photo: Jan-Rune Smenes Reite/CC

Nick Hart, West Midlands Socialist Party

Two days in the job, and Liz Truss was already making her first U-turn! Having just a month ago rejected the idea of further ‘handouts’ to deal with the out-of-control cost of living, she has now announced that, rather than going up to £3,500 per year, the energy price cap will now ‘only’ increase to a maximum of £2,500.

In reality, the only ones this represents a handout for is the energy firms. Energy retailers will pocket up to £150 billion to hold prices down, and subsidise the billions to be handed over to energy producers for record, high-priced wholesale energy.

With the average household bill still set to nearly double from its level a year ago at the start of next month, this will do little to change the feeling that many working-class people have of literally not knowing how they’ll be able to keep the lights on this winter.

Many of those struggling to pay the bills will look at the £200 billion paid to shareholders by energy companies in the last 12 years and ask: where did this money go?

Energy industry bosses will point to the rise in wholesale gas prices across Europe during the war in Ukraine. But this overlooks the fact that producers of renewable energy have opportunistically hiked wholesale prices by as much as £40 billion to match the price being paid for natural gas.

Truss is now proposing to reward this price gouging by offering energy producers long-term contracts at inflated prices. But though electricity is now costing households twice as much as it did this time last year, is it taking twice as much work to keep power stations turning? The answer is no!

Despite Truss’ pledge to “end the UK’s short-termist approach to energy security and supply once and for all”, these measures will not stop profiteering and price fluctuations in future years in a capitalist world increasingly dominated by conflict, extreme weather and political instability.

The only long-term solution to the energy crisis is taking control of necessities of life such as electricity out of the hands of the private energy companies and bringing them back under public ownership. This would allow democratic control of energy production and supply for the benefit of the working-class majority, not a small number of speculators and spivs. The fact that Starmer’s Labour has ruled this out only underlines the need for a new mass workers’ party which can advance the socialist policies needed to ensure that ordinary people don’t pay the price for capitalists chasing profits.