When any crisis faces the country, it falls to the government to act, and to do so swiftly. So with the energy crisis, we need the government to stop the dither and delay of the last decade and act.
In contrast, Labour has already put forward a bold plan to levy a windfall tax on oil and gas producers, who have made billions in this crisis, to limit the expected price rise in April. Our package would save most households about £200, and we would also target extra support to 9 million of the lowest earners, pensioners and the squeezed middle, taking up to £600 off their bills.
But crisis response is about learning the long-term lessons, not just taking short-term action. Of course, there is a global dimension to this crisis, but the British people have a right to ask why we have been hit so badly. In no other country have 28 energy suppliers gone bust – consumers will have to pick up the tab with £100 on bills and rising. They also have a right to ask why our energy system seems so vulnerable to the volatility of international markets and why we have a social safety net that seems so weak and inadequate. This crisis is a parable for the problems of Tory Britain.
First, just as the banking crisis of 2008 exposed the deep flaws at the core of British capitalism, the present crisis is a symptom of the Conservatives’ failure to properly manage our energy policy or regulate markets. Despite warnings from Labour and others at the time, they allowed the UK’s last major domestic gas storage facility to close in 2017 and they ignored repeated warnings that the drive to increase competition in the energy market was being pursued at significant risks to consumers and, in fact, loosened regulations in the middle of the decade.
Second, while some people will tell you that the move towards green energy is the cause of the crisis we face, the truth is the opposite. It’s is our dependence on fossil fuels that makes us more vulnerable and the government’s climate delay that has left us less resilient. Take energy efficiency. A proper home insulation plan could have significantly reduced household energy demand, and therefore our reliance on gas. But we have had systemic failure from the government, with the abolition of the zero carbon homes standard, the disastrous green deal and the chaotic Green Homes Grant. Emissions from buildings are as high now as they were in 2015. We have also seen an effective moratorium on onshore wind, cuts to solar subsidies and the stalling of the nuclear programme. All have made us less resilient.
Third, we cannot divorce this crisis from the wider economic model we have. This crisis exposes the deep insecurity that is now baked into the British economy. Even before this crisis, too many people were living from paycheck to paycheck and without proper savings. And it is not just those on the lowest incomes; many middle-income earners have also seen their economic security undercut by rising prices, too.
The answers on offer from both wings of the Conservative party are inadequate. Dumping the green transition overboard would not just invite climate disaster but make us far more vulnerable as a country, because we would remain reliant on fossil fuels with all the instability we have seen. Nor can we have any confidence that this government can provide the long-term solution we need. It speaks volumes about the Conservative party, its defence of vested interests and its refusal to stand up for working people that it is opposing the windfall tax and the measures it would fund.
A Labour government will bring the long-term changes we need. We need to take a step back and look at the way the energy system works in its entirety. That’s about the regulation of the market, but more broadly about how we have a grid, transmission, generation and supply system that can properly meet the demands of affordable energy bills, security and the climate transition. There are crucial questions to address, including the way that the price of electricity is still tied to gas, the need for clean energy storage and how we have a grid that can be ready for a zero carbon energy system.
We will drive further and faster towards an urgent and just transition. We have pledged to put in place a £6bn a year retrofit and zero carbon housing programme every year over the next decade. Led by local authorities, our aim is to help insulate the 19 million homes in Britain that fall below adequate standards. This could cut households’ bills by up to £400 a year and reduce our emissions. And we would drive forward all the sources of zero carbon power we need.
Fundamental to changing our country in the way we need to is fixing a broken economic model of low wages and low growth, leading to deep economic insecurity. That is where the Green New Deal and Labour’s £28bn-a-year climate investment pledge must be transformational. We will support and create good, unionised jobs in industries from offshore wind manufacture to a national nature service.
The energy crisis is the product of a decade of Conservative failure. There is a new future to shape for our country if we take bold action. A Labour government would stand up to vested interests and put working people first. That is the way we will build an economy that is more prosperous, sustainable and secure for all.