ENERGY company bosses will appear before MPs today for what could turn into something of a needless and pointless show trial.
The gas and electricity utilities have become the new banks in the unpopularity stakes, but today’s meeting of the energy select committee must not turn into another bating session.
Politicians see the utilities as easy fodder; not only monolithic and powerful but seemingly out of control and uncaring.
Whatever the truth, it is becoming clearer by the day that the current level of hostility can only get worse and that changes are required that will revolutionise not only charges, but the way the industry is financed.
While MPs of all shades will accuse the companies of profiteering, the companies will respond with the usual defence that wholesale prices are rising and that the government must carry much of the blame itself. Certainly, the utilities are paying a high price for meeting tough environmental targets. Someone has to pay and inevitably it will be the customer.
Politicians who desperately wanted to be seen as the champions of the green economy during the boom years are now seeing the effects of these levies in times of hardship. At the risk of undermining their own commitments, they must ease back on these ambitions, or else switch funding from the customer to the general taxpayer.
Equally, the government needs to provide greater clarity in energy policy that will encourage the utilities to invest in more efficient plant to meet future demand and reduce costs. Sadly, the committee meeting is unlikely to set a course for improvement in relations between the two sides and instead is likely to provide a platform for more mud-slinging.
Words of warning from Grangemouth boss
THe resignation yesterday of Stephen Deans, the union convener caught up in the Grangemouth dispute, will hog today’s headlines but the row extends well beyond a 1970s-style confrontation.
Jim Ratcliffe, the founder of chemicals business Ineos, has given Chancellor George Osborne a stark warning about the future of manufacturing in Britain unless there are some big changes.
The normally reserved Ratcliffe has left the Chancellor in no doubt that he needs to rethink policy on taxes, tackle energy prices (see above) and provide national insurance holidays for employers taking on apprentices. Behind his presentation is a wake-up call to get the infrastructure right for investment.
Ratcliffe has already shown that he does not bluff when he shut part of the Grangemouth plant until the Unite union agreed to Ineos’s survival plan. Osborne should take note.