Gerald Warner: The energy-sapping debate

Picture: Getty
Picture: Getty
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WHEN war breaks out ­between large energy companies and politicians it provokes the wistful reaction: if only they both could lose. On this occasion, such an outcome is not impossible.

When Ed Miliband ­produced his conference-pleasing pledge to freeze energy prices for 20 months, the knee-jerk Tory reaction was to deride such unsophisticated dirigisme as further ­evidence of Red Ed’s regression to polytechnic Trotskyism.

This dismissive response was justified insofar as the energy price freeze was yoked in tandem with a scheme for land confiscation that suggested Ed, Son of Ralph, had successfully got in touch with his inner Robert Mugabe. On energy ­prices, however, it quickly became apparent that Dave and his sniggering cohorts, not for the first time, had badly misjudged the public mood. Some people take the selfish view that it would be highly congenial to see prices, rather than pensioners, frozen during the winter of 2015 and are threatening to cast their suffrage ­accordingly. The Tories have discovered that talking down to the consuming ­public, in the same style in which they insisted any attempt to curb bankers’ ­bonuses would be infantile and impracticable, is electorally dangerous and they are backtracking accordingly.

The energy companies are embracing victimhood – we all know they are struggling to keep their heads above water. That is why average annual household bills have risen from £625 eight years ago to £1,250 today. Take our own iconic (if Spanish-owned) ScottishPower: its profits doubled from a breadline £350 million in 2011 to a barely sustainable £712m in 2012. Ignacio Galán, chairman and chief executive of its owner Iberdrola, has now warned that if its further profits are put at risk by a Miliband freeze on prices the company may withdraw from a £15 billion investment programme. With SSE announcing an 8.2 per cent price rise this winter, is it likely that ScottishPower and the other four large energy companies will refrain from following suit?

There is already a tangible benefit from this row: the elephant in the room is now acknowledged and, for the first time, is being openly debated. The cause of energy price inflation is not only the companies’ greed, but also the government’s green taxes. The energy suppliers have pushed Dave into a corner by declaring that household bills would fall by £110 overnight if green subsidies and environmental taxes were removed from consumers’ tariffs.

That is true, as far as it goes, but it falls short of addressing the real issue. If the Danegeld extorted from consumers to meet the demands of climate cultists were transferred to general taxation, that would at least reduce the incidence of ­paramedics defrosting grannies found inert in unheated houses; but it would simply shift this unjustifiable burden elsewhere by provoking tax increases.

We should not be paying these ridiculous taxes at all. Nor should we be destroying our once peerless landscape with forests of wind turbines. The current calculation is that £22bn in subsidies will be doled out to “green” energy generators to pay for wind farms across the UK over the next six years. That money will come from consumers’ bills. This is madness. Even if public outrage forces the costs to be transferred to general taxation, that is still insane. Two contenders – the energy giants and the political establishment – are locked in battle, trampling the undergrowth in which the plundered citizenry struggles for survival, unheeding of real needs and concerns.

The political class is out of control. The rampant greed of corporations incapable of distinguishing between capitalism and brigandage – as with the banks – is a cynical but familiar phenomenon: such greed has been curbed in the past and can be again. The political elite here and in Europe is another matter. The climate lie has given the Brussels kleptocracy an all-purpose, comprehensive pretext to bleed its electorates white. There is a fanaticism, an irrationality, about the climate jihadists that defies reality. It is now clear that the True Believers are determined to restrict all energy generation to wind power.

Last week Brussels took the first step towards prohibiting shale gas exploitation in Europe. In the words of Jos Delbeke, director-general of the European Commission’s climate divisions: “We don’t want to copy and paste what happened in the US. We will do things differently in Europe.” What happened in the US was a halving of energy bills due to fracking and allied technology. The jokers at the IPCC have weighed in, plucking another of their notorious statistics out of the air to claim that methane, released by fracking, is 86 times more damaging than carbon dioxide (previously considered the most toxic compound in the universe by True Believers) over a 20-year period. The Stone Age beckons, but will the lights go out before we are all bankrupt? «

Twitter: @GeraldWarner1