It was great to be in the hall at conference in Brighton last week during Ed Miliband’s fantastic notes-free speech. He got no fewer than three standing ovations DURING his speech – for his commitment to implement Andy Burnham’s plan for integrating mental health and social care with the rest of the NHS I don't think the media and public have woken up to how radical this could be!); for his commitment to lowering the voting age to 16 and for his pledge to repeal the bedroom tax. Yet the media, pre-briefed on much of the above, focused on the surprise announcement: the freezing of energy prices until January 2017.
Immediately the Tory press and energy industry came out with their predictable message of doom and gloom: it was illegal (yet they regulate prices much more rigidly in other EU nations), it would cause ‘blackouts', it would deter investment in renewables and it was, of course, a Marxist plot cooked up between Ed and his father back when Ed was in his teens. Clearly, this is drivel. Thankfully it seems, according the latest polls, the public have seen through the blue fog of lies and love the idea, hence the change in the Tory's stance from hysterical (Schapps and Pickles) to the more nuanced – ‘energy companies haven’t behaved well, prices are too high, but this isn’t how to deal with it’ (Gove and Cameron).
The public’s passion for this policy is hopefully a sign that they are acknowledging that under Ed Miliband our party’s mission will be to stand up the vested interests (Murdoch, bankers, energy companies, developers who sit on land and payday lenders to give some examples). That said, we can’t be complacent, the reach of the Tory press is still considerable and makes up the majority of newspaper readership. Their message will be a consistent battery of fear mongering bile.
We shouldn’t be put off spreading the word about this policy though; its immediate simplicity is striking and helps us sell it on the doorstep but it is very thought-through if people do want more information. Firstly it won’t cause ‘blackouts’, the energy companies themselves – within minutes of Ed’s speech finishing, were running adverts on Google saying: ‘Don’t wait until the election, freeze your prices until 2017’. 3 of the big 6 are now offering this deal, yet Centrica (who own British Gas) aren’t. Centrica make the biggest profits and yet invest the least of the big 6 companies – and no prizes for guessing who is shouting loudest against the freeze. They can afford this freeze, they deserve this freeze.
Don’t get me wrong. Britain’s energy infrastructure needs massive investment and we have declining capacity and increasing reliance on imports but this is precisely because of the decades of underinvestment from these private energy firms. This prize freeze is only temporary, it is designed to cover the time it will take to pass an Energy Bill through Parliament that would legislate for comprehensive reform of the energy market. Such an Energy Bill would focus on breaking the ‘vertical integration’ i.e. the people owning the plants can’t be the same as those selling the energy. This, combined with a target for decarbonisation by 2030, would open up the production market to smaller renewables firms (i.e. increasing investment in renewables!) and also opening the market to new players willing to work on lower profit margins in order to gazump the others by offering households and businesses lower prices.
This is the message we need to get across to anyone on the doorstep who is having doubts about the feasibility of the proposals:
1) This is absolutely genuine, Labour will definitely freeze prices from the May 2015 to January 2017;
2) This is a pro-business intervention - it will save non-energy sector businesses millions which may well lead to lower prices and/or new jobs in other sectors;
3) We agree investment in new power stations is vitally important, particularly renewables, but that just isn’t happening under the status quo. Therefore we would:
a. Commit to a decarbonisation by 2030 target to give renewables investors assurance that the UK is the place to put their money;
b. Use the 20 month period of the price freeze to change the way the generation market works so that it is focused on high levels of investment and more open to new entrants, particularly renewable producers like solar farms, wind farms and tidal technology;
c. Also use the price freeze to change the way the sales-side of the market works so that its easier for new companies – or even not-for-profit organisations - to enter that market and offer lower prices by working on lower margins rather than affecting investment in generation which will be a completely separate market;
d. The Energy Bill would also tie all providers into providing a much more simple, easy to understand tariff system; and
e. It would also abolish Ofgem and put a really tough new regulator in its place.
The constant refrain pre-conference was that people wanted to hear Labour’s policies. Well on energy Labour have a really comprehensive offer. I haven’t even mentioned that Labour would harness the public sector’s energy use to encourage investment in renewables by committing the NHS, schools and Whitehall departments etc. to use green energy and also giving serious borrowing powers to the Green Investment Bank that would further support investment in this area.
We need to let the public know that Labour is the only party that will lower their bills, instigate the investment that is needed to secure our energy supply and be the only serious green choice at the next election with a fundamental understanding of our collective responsibility to future generations to develop renewables now.