Link to this page: https://secure.socialistparty.org.uk/issue/842/20054
Death, taxes and energy profits
Energy companies' rising profits can be added to Benjamin Franklin's famous remark that the only certainties in the world are death and taxes.
Ofgem, the toothless industry watchdog, reckons the 'big six' energy giants will squeeze an average household profit of £114 next year (up from £105), despite wholesale energy costs falling by 30% in the last 12 months.
As usual, the big six protest that they're cutting consumer bills. But this comes after years of huge price rises and, typically, most of the bill reductions will occur after the worst of the winter weather, when energy demand begins to fall.
According to government statistics (the most recent are from 2012) some 2.28 million households were experiencing fuel poverty. However, under the previous definition of fuel poverty - ie spending 10% or more of income to heat your home - some 4.5 million households were affected.
Many people are having to choose between heating their homes or eating properly. Many also are in working households.
It shows that this government is doing next to nothing to assist cash strapped families while the cash tills continue to ring for big business.
Labour, eyeing the forthcoming general election, says it will give Ofgem powers to force energy companies to cut gas and electricity bills if wholesale prices fall, as well as freezing energy prices for 20 months.
The latter promise begs the question as to how Labour would prevent companies, before and after the price freeze, ramping up domestic bills if wholesale energy prices marginally increase? Clearly as long as the big six companies remain privately owned, controlling prices will prove to be elusive.
The obvious solution to setting affordable prices is to nationalise the major energy companies as part of an overall economic plan of production. In other words, you can end fuel poverty by socialist measures.
In The Socialist 4 February 2015:
Socialist Party news and analysis
International socialist news and analysis
Socialist Party workplace news
Socialist Party reports and campaigns