Britain’s electricity supply is in peril. On Monday (20 Sep) the Financial Times reported,
Peter McGirr wanted to modernise the British consumer energy market when he founded Green three years ago, building a customer base of more than 250,000 households. Now, with the sector in meltdown, he says it is “incredibly unlikely” the Newcastle-based supplier will survive until Christmas without government intervention.
Five smaller suppliers have collapsed in the past six weeks, with four or five more expected to join them in the next 10 days as the industry is battered by unprecedented surges in wholesale electricity and gas prices.
Observers are predicting as few as 10 suppliers will make it through the winter, implying 40 could go bust. Some executives have privately suggested the sector could go back to a big four, five or six companies.
How did this happen to us? I know who to blame for setting the UK on this disastrous course. On Tuesday 24 September 2013, eight years ago tomorrow, the then Leader of the Labour party, Ed Miliband, gave his big speech to the Labour party conference in Brighton. One item was particularly popular:
“If we win the election 2015 the next Labour government will freeze gas and electricity prices until the start of 2017. Your bills will not rise. It will benefit millions of families and millions of businesses. That’s what I mean by a government that fights for you. That’s what I mean when I say Britain can do better than this.”
The response from the Tories was immediate and scathing:
Energy minister Greg Barker attacks Labour’s plan to cap energy prices
In response to Ed Miliband’s announcement, the energy minister says capping energy prices would have catastrophic consequences for investment in the UK
Figures from the gas industry chipped in:
The lights could go out if Labour introduces its 20-month freeze on energy prices, Ian Peters of British Gas said. “If we have no ability to control what we do in the retail prices” and wholesale prices suddenly go up within a single year “that will threaten energy security,” he said. Asked if that meant the lights would go out, he replied: “I think that is a risk.”
But Mr Miliband’s policy had equally vigorous defenders. On 25 September 2013, the day after Mr Miliband’s speech, Alex Andreou of the New Statesman thundered:
Ed Miliband’s critics think his energy pledge will make the lights go out. They are wrong
The critics were wrong. Ed Miliband is innocent OK! It was not his pledge that a Labour government would limit energy prices that has brought us so near to having the lights go out.
The Conservative manifesto of 2017 included energy price controls, duly introduced by Prime Minister Theresa May on 1st January 2019.
And here we are.