Nationalise the energy sector now

The energy crisis is not simply a one-ff 'perfect storm', but is inherent in the profit-driven market economy

The energy crisis is not simply a one-ff ‘perfect storm’, but is inherent in the profit-driven market economy   (Click to enlarge: opens in new window)

Jaime Davies, Caerphilly Socialist Party

While millions will have to choose between heating or eating, the big energy companies are laughing all the way to the bank. BP and Shell are making £900 a second in profit!

Every six months, the energy regulator Ofgem reviews what the maximum amount should be that providers can charge domestic customers for energy bills. When last reviewed in October, around 15 million households in the UK saw energy bills rise by 12% to their highest ever level, as the cap was increased to a staggering £1,277 per year.

This month Ofgem is set to review the cap on prices again, and in all likelihood the cap will be further increased with energy bills going up from April. A ‘sharp increase’ is unfortunately not an exaggeration in terms, with the industry predicting a 50% increase in bills this year, an average annual cost of £2,000 per household.

Providers such as British Gas, Scottish Power, EDF and SSE to name some of the bigger companies, are trying to justify the price hikes, citing the rise in raw energy costs since last summer as their reason. But they are still paying bonuses and pay rises for the bosses and big shareholders. For example, the CEO of Centrica, Chris O’Shea, has a salary of over £750,000 a year that he can put towards keeping his home boiler firing.

While workers in the sector face redundancy, 9.4 million elderly people worry about affording to keep warm; companies like Shell are not making millions but billions out of the energy crisis. Shell is forecast to have made £13.5 billion in 2021. BP boss Bernard Looney is even on record saying that the company is like ‘a cash machine’.

The best solution to the energy crisis is to nationalise the companies involved and bring them under democratic workers’ control. By doing so we could immediately use the massive profits held in the sector to improve services and bring costs down, as well as give all workers a decent pay rise and take on those who have already been made redundant.

Rather than decisions about energy needs being made behind the closed doors of boardrooms, a nationalised sector could be run by the workers themselves, the trade unions and the wider working class. Prices could also be kept down, not having to fund enormous pay-outs and bonuses for private owners and interests.

And with a nationalised energy sector, priority could be given to investing in researching renewable alternatives to domestic gas heating. This is a seemingly utopian prospect under private ownership where it is easier and more profitable in the short term to continue with gas while the planet coughs and splutters.