Energy: We Need to Own it – The London Economic
The LOndon Economic

Energy: We Need to Own it

By Oliver Ward   

Over the last three months, for the first time in history, Britain’s renewable energy production surpassed its coal production. A monumental moment, the palpable demonstration of how far renewable energy has come in the UK and the changing attitudes towards our role as inhabitants on this planet. A view clearly not shared by the Conservative party who have announced that subsidies for renewable energy companies will be ended on the 1st of April next year. Leaving over 1,000 wind farms currently awaiting planning position completely unable to open and produce power without government help.

Cameron’s incentive slashing parade which is bearing down on the renewable energy industry only demonstrates how far behind his party is on the topic. On September 22nd 2013 Hamburg voted in favour of putting electricity and gas under city control, reversing the current trend of privatisation and representing a huge victory for the ‘Our Hamburg- Our Grid’ scheme. Their logic; that a locally run energy system could cater for the local community, make decisions locally rather than in distant boardrooms and significantly boost the local economy. Any surplus energy could be sold into the national grid and the profit put back into the city. The cheapest way to do this? Renewable energy.

Germany incorporates a mix of incentives to help the production of renewable energy companies and as a result they are way ahead in terms of creating cleaner energy (in 2013 25 per cent of Germany’s energy came from renewable sources, compared to four per cent in the US and 15 per cent in the UK). They ensure that any existing energy provider who wants to convert to renewable sources can do so by giving renewable energy priority access to the grid at a guaranteed fixed price. By creating a government regulated price, uninfluenced by fossil fuel factors like the price of oil and coal, they have enabled small providers to go green. It also allowed small cooperatives, like the proposed Hamburg cooperative, to make the change.

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In 2014 alone 29 new energy cooperatives were founded in Germany which allowed over 400,000 new jobs to be created and hastened the cutting of emissions by accelerating the move to cleaner forms of energy production.  Switching to renewable energy and the publicisation of our energy industry go hand in hand. It’s no coincidence that many of the countries committed to switching to renewable energy also have managed to keep much of their energy production under public ownership. With a centralised, privately owned energy system the bill payers are at the mercy of huge profit driven corporations who are able to increase prices in the market without any resistance. By decentralising it in the form of locally run cooperatives, the people can create a system run for them, bringing with it local jobs, lower energy bills (Fergus Ewing, Scotland Energy Minister has estimated the cuts to renewable energy subsidies will cost the public £2-3 billion more in energy bills), and cleaner production. Currently Britain’s National Grid distribution networks are owned by only six companies, four of which are foreign owned. Britain could benefit hugely from more energy providers on British soil, creating jobs, boosting local economies and reducing reliance on foreign energy.

A similar scheme has been rolled out in South Africa. Aptly named 1 million Climate Jobs. In 2008 a coal shortage led to widespread energy blackouts across South Africa so the coalition became committed to finding an alternative in renewable energy sources. (announcing a target that 40 per cent of their energy production would come from renewable sources by 2030.) The government introduced procurement requirements, meaning equipment needed to be sourced locally, creating thousands of jobs in Cape Town and Port Elizabeth where wind turbine production began in earnest. Now 92 new renewable power producers have started companies in South Africa and are building new energy sources. Like Germany’s guaranteed price, South Africa’s procurement requirements demonstrated that with government help the renewable energy sector could create jobs and cut emissions in tandem.

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The problem is that since the 1980s it has been considered a taboo for government to interfere with businesses and free markets. As Naomi Klien argues in her new book, This Changes Everything, business planning by governments has been equated with the political left and shunned in neoliberalist societies, however this was not always the case. Republican President Richard Nixon imposed price and wage controls, and the bailout of the private banking industry in 2008 shows that there needs to be a relationship between government and industry. The energy sector needs to be bound by government regulation to yield a system where the customers are not exploited for a commodity they need. In addition the creation of jobs and movement to clean energy cannot be left to the private sector, if we are to meet our clean energy targets by 2030 (required to prevent 2 degrees of warming) we need to quadruple the investment in renewable energy in Britain and this will not happen unless there is government intervention and regulation in our energy markets. This involves taking our energy companies back from the likes of E.ON, EDF and nPower and putting it back into public hands.

Damian Carrington reported in the Guardian that no less than fifty employees of energy companies like EDF and nPower have actually worked in government on energy issues for the last four years, provided by the energy giants free of charge. So there is clearly already a strong relationship between the energy market and the Conservative government, but this needs to become a positive realtionship which would benefit the country, not the corporations and the Conservative Party.

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