More whinging from ‘Scottish’ energy companies
Scottish (well on the headed paper) energy companies have chipped in again today on the Ed Miliband price freeze.
Scottish Power’s Keith Anderson has warned that the plan to freeze tariffs could jeopardise billions of pounds of investment and thousands of jobs. Doubly strange, because as Dave Watson pointed out last week, Scottish Power has a price freeze offer till 2017. Or perhaps the offer is not all it appears?
Anderson went further, hinting that investment by the company, which is owned by Spain’s Iberdrola, could go elsewhere, “As an international energy company, we carefully analyse all of the major markets in the world. Maintaining principles of sound regulation and avoiding regulatory uncertainty are critical to securing this global investment in the UK.”
Well, others might point to Iberdrola’s own financial struggles and wonder if this is the excuse the Board was looking for? Frankly, if Iberdrola can’t hack it, they should sell up and get out of Scotland. There was a profitable business before they arrived and there will be one when they go.
SSE do at least make a fair, if unrealistic point, that the breakdown of political consensus meant investments becoming riskier, borrowing more expensive and consumers ultimately paying more. SSE CEO Phillips-Davies said, “Without cross-party political consensus on the key issues the uncertainty will remain until 2015 and potentially beyond. Energy policy is too important to become paralysed by politics”. He also said that government policy costs should be put into taxation as the current system is regressive.
The problem for the energy companies is that the energy market now symbolises private market failure at its worst. Even Cameron has intervened to a degree that you would have thought was unthinkable for a Tory. Everyone can see the exploitation of the consumer with annual price increases 3-4 times higher than inflation, the avoidance of corporation tax, the massive pay hikes at the top and the failure to invest in our energy future.
Even for those who still believe in the kid on energy market, the excessive concentration of power and absence of competition clearly undermines their position. The ‘big six’, if not actually a cartel sometimes appear to be moving in lockstep, confusing the market with hundreds of bewildering tariffs and have left five million households across the UK in fuel poverty.
The case for firm action to protect the fleeced customer and to safeguard the national interest is crystal clear. Whinging from the energy companies has come far too late and the blackmail won’t work either. The power company bosses should listen to the views of customers on the phones, as staff do. Then they might get the message.
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