Summary

Whether it’s 11 years or 18 months, we haven’t got long to make the big, bold changes needed to prevent global climate catastrophe.

If we’re going to have a chance of preventing widespread disaster, we can’t keep waiting for the private sector to deliver our clean, green energy future. Public ownership is the way to transition quickly to zero carbon, hand in hand with workers, citizens and communities.


Privatisation failed – if you see Sid, tell him

In 1986, when Thatcher sold off British Gas, the company was floated on the stock market, accompanied by the famous “Tell Sid” advertising campaign. In 1990, the UK’s regional electricity boards were privatised. But a shareholder democracy owned by people like “Sid” never materialised.

We don’t own much of our energy, individually or collectively. The UK is rich in offshore wind, but only 7% is owned by UK entities and only 0.07% is in UK public ownership.[1] We’ve flogged off our nuclear to China and France – for “£17 billion of risk and not much benefit” as Aditya Chakrabortty points out.[2] Our energy infrastructure is owned by National Grid and other private companies owned by investors from Qatar to China, US to Hong Kong. The Big Six supply companies (British Gas, E.ON, EDF Energy, nPower, Scottish Energy and SSE) are owned by UK, French, German and Spanish investors.

These investors aren’t interested in clean, green, affordable energy. They’re interested in their profits. That’s why since energy was privatised we’ve seen rip off prices, burning of fossil fuels and a lack of investment in the infrastructure we need. Bringing energy into public ownership would save us around £3.2 billion[3] in dividends and lower cost of borrowing – money that could be reinvested in getting us to our carbon targets quicker.

As a working paper by Trade Unions for Energy Democracy stated:

The transition to a low-carbon, sustainable future cannot be left to the investor class, CEOs of multinational companies, or governments that refuse to break with the current paradigm of endless growth, the imperative of profit, and the enforced chaos of competition in strategic sectors. Acting alongside other social movements, unions can begin by explaining the challenge in clear terms. Unions must then develop transformational strategies that are anchored in a paradigm of sharing, solidarity, and sufficiency. This is perhaps the only way to ensure a Just Transition for workers, and survival for human society as a whole.[4]
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Across the world, people are taking energy back

The Transnational Institute (TNI) has tracked cities around the world that are taking back control of their local energy supply, sometimes backed by popular votes.[5]

The city of Munich in Germany is particularly inspiring. It has committed itself to developing an electricity supply that is 100% municipal and 100% from renewable energy.[6] The council did this because they were tired of waiting for the private companies to make the necessary investments, and they were confident that the city council could do the job better – putting sustainability before profit. By 2025, the utility company aims to produce so much green energy that the entire demand of the city can be met.

What would public ownership mean in practice?

77% of us believe energy should be in public ownership.[7] A recent report from We Own It aims to outline what energy democracy means in practice, proposing that you would have easy access to data and information, and could give your feedback and ideas online, on the phone or in a shopfront on every high street.[8] You’d be a member of “Participate: Energy” – the new, democratically accountable organisation that represents everyone who uses energy. Energy reps will sit on supervisory boards, alongside trade union reps and civil society reps – like environmental NGOs, fuel poverty groups, renters unions and local community groups.

Public planning processes would include large scale meetings every five years, annual reporting back, open board meetings and citizens assemblies for difficult or controversial issues. 

We need local, regional and national conversations about our energy future. Andrew Cumbers explains how in Norway, the publicly owned company Statoil was set up in 1972 in order to control the use of oil in the interests of the “whole of society”.[9] Although Norway now needs to transition beyond oil, we can still learn from this example. The company was subject to a lot of democratic scrutiny and debate in parliament and a new, independent “Petroleum Directorate” was created, with responsibility for regulating and controlling North Sea oil and gas resources, which led to better health and safety for workers.

The conversations should involve organisations and groups who understand the challenges in the energy supply chain. Controversial, extremely damaging extraction techniques like fracking should be outlawed altogether. Asad Rehman has argued the Green New Deal will be dirtier than we think as the technology often depends on extracting rare minerals from countries like the Democratic Republic of the Congo and Chile.[10]

We need the right to vote against any proposals to privatise or outsource energy. In 2013 the citizens of Hamburg voted to reverse the privatisation of the city’s electricity, gas and heating networks.[11]

These accountability mechanisms and democratic processes would go hand in hand with a bold plan for a Green New Deal, delivered through public ownership at every stage: generation of renewable energy, transmission and distribution across the country, and supply to our homes.

Generating green energy and green jobs

Government has a duty to decarbonise – and that means leaving the oil and gas in the ground. Platform points out that extracting 20 billion barrels of oil and gas will make it totally impossible to meet our carbon targets.[12] The UK and Scottish governments need to switch subsidies to renewables and work with trade unions and communities on a plan for just transition.

The Public and Commercial ServicesUunion (PCS) report “Just Transition and Energy Democracy” explains that over 250,000 mining jobs were lost in the 1980s and 90s – we need to “address the legitimate fears of workers that they will again be left to pay a disproportionate price”.[13]

To answer this, government, councils and unions need to work together to introduce new green, permanent, unionised, skilled jobs and revitalise communities across the UK. We need a new Lucas Plan,[14] with workers at the heart of the process – looking at how technology can be best deployed for social benefit.

As the Campaign against Climate Change has called for, we need to create a million good green jobs in the public renewable energy sector.[15] Growing our public transit systems, retrofitting for low-carbon homes and buildings, as well as changes to our logistics sector are all necessary and achievable through solid education and training programs.

Public ownership can create hundreds of thousands of jobs in generating energy and in new industry supply chains. There are very few places in the UK where renewable energy can’t happen – wind and solar can be delivered almost everywhere. This creates a huge opportunity to reverse decades of underinvestment in ex-mining communities decimated by Thatcher.

Platform estimates that 40,000 existing oil workers (direct and supply chain) may need to be in a different job by 2030. But their research shows that with ambitious government policies we can create three to four times as many jobs in clean energy industries.[16]

Right now, government is undermining renewable energy with regressive policies, failing to give vital support to onshore wind and solar – and renewable energy jobs have plunged by a third.[17] This is a disaster. The government needs to reinstate subsidies for solar and deliver an onshore wind boom.

Workers and climate change protestors joined together in an 11 day occupation against the closure of the Vestas wind turbine factory in 2009.[18] (The company has now created some new jobs but not as many as it axed). We could take control over decisions like this, with a publicly owned British company with a long term strategy for turbine manufacture, with workers, citizens and the public on the board.

Offshore wind is touted as a success, but the real story here is that the public is missing out by leaving it to non UK companies (public and private) to pick up the benefits. Instead we should be following the example of countries like Denmark and Sweden – their publicly owned companies DONG and Vattenfall own 32% and 6% of UK offshore wind capacity, respectively.[19] We need our own “Waterfall”.

The Labour Energy Forum report “Who owns the wind?”[20] proposes the creation of four major publicly owned offshore wind companies: Scottish Wind, Energy for Londoners, Wind of the North and Floating Cornwall. These would lead the way in investing in and directly operating publicly owned offshore wind capacity. Effectively they would also act as anchor institutions, boosting local and regional economies.[21]

The public sector can build its renewables capacity and expertise and ultimately deliver far more efficiently than the private sector. Modelling work by Frontier Economics for IPPR shows how full public ownership through construction and operation can generate substantial savings for consumers because of the lower cost of capital.[22] In addition, there are the profits coming back to the public purse – Swindon Borough Council has a solar bond that generates £1 million every year.

Connecting communities to the grid

The National Grid – which transmits electricity and gas across the country – and the regional distribution companies which distribute energy – were built for an age of coal, oil and nuclear. The future of energy is decentralised and renewable. We need to own this vital infrastructure so we can upgrade it.

The National Grid and regional distribution companies don’t answer to you and me – they answer to often very distant investors. If you’re based in London, your electricity is distributed by UK Power Networks, owned by a Hong Kong company led by one of the richest men in the world. Your gas might well be distributed by Cadent Gas – recently found guilty of leaving residents without gas for up to five months, and putting 775 blocks of flats in danger by keeping no inspection record – owned by a consortium including Macquarie (an Australian investment bank), CIC Capital (owned by China Investment Corporation) and the Qatar Investment Authority. [23] 

These private energy monopolies often make it difficult for community groups who want to develop new renewable energy projects, so the process is slower and more expensive than it should be. Communities in Harris and Lewis have been slowed down by National Grid in their effort to develop a wind farm. Communities in Cornwall were told by Western Power Networks (owned by shareholders in New York) that new solar farms would require “quite expensive” investment in infrastructure.[24]

Under public ownership, National Grid and the regional distribution companies would have a duty to work closely with community groups to develop new renewable energy, and to steward public assets and land. In Germany, renewable energy producers have a guaranteed right of access to the electricity grid.[25]

Public-Common partnerships” can be developed – this means councils create shared institutions with cooperatives or community interest companies to manage common resources in a democratic way.[26] In Wolfhagen in Germany, the town’s energy utility is jointly owned by the municipality and a new cooperative. Community energy projects can also be rolled out to power a solar railway (the “Riding Sunbeams” project) to help decarbonise transport.[27]

As Andrew Cumbers points out, the Danish government has encouraged local, decentralised wind power on a huge scale, through funding and support for local, collective ownership of turbines.[28] The Danish Wind Turbine Owners Association is an independent, democratically elected membership association set up to represent these small scale, private and cooperative owners. With 5,000 members, it provides a strong voice for local communities on energy policy.

Supply companies that work for all of us

Customer satisfaction with the Big Six companies is low.[29] Only 32% of the public trust the energy industry[30]. Tying ourselves in knots to create markets and choice in every sector doesn’t make sense. Energy customers don’t want to switch – 61% of us have never switched company[31] or only switched once – so we pay a loyalty penalty.[32]

Citizens Advice has also shown how we overpay because of the way energy is regulated – this amounts to £11 billion over the past 15 years.[33] The poor are hit hardest, spending 14% of their income on energy and water.

It doesn’t have to be this way. Corporate Watch research suggests each UK household could save £158 a year if energy was publicly owned[34]. Across Europe, bills are around 30% lower when energy companies are in public ownership.[35]

Publicly owned energy supply companies would have a duty to make sure everyone has access to affordable energy. This could include progressive tariffs to tackle over consumption and fuel poverty at the same time by charging high use households more while giving everyone some free energy – alongside a “no cut off” policy.

Forward thinking councils are already created new, inspiring, publicly owned supply companies – with Nottingham-based Robin Hood Energy boldly leading the way and setting up ten white label partnership agreements with local authorities around the country. Bristol Energy and The People's Energy Company are also breaking new ground. We need to sign up to get our energy from these companies – then build on these exciting options across the country. Ultimately when we get the privatised energy companies out, regional distribution companies could offer supply to people in the area, but with local companies taking over wherever they exist.

The Green New Deal should also mean we are energy citizens not energy consumers. We’re all part of the war effort against climate change.

Most of the UK’s 27 million homes were built during the Victorian era, as Ann Pettifor points out.[36] We have some of the least efficient housing in Europe, and the highest proportion of fuel poverty – 11% of English households.[37] The Green New Deal is an opportunity to change all that. Every house can become a power station, with double glazing, insulation and solar panels (unless it’s about to be rebuilt).

Trusted, publicly owned companies can create new jobs for advisors to go door to door. Pettifor proposes a “carbon army” of workers: highly qualified, skilled and unskilled workers to retrofit and reconstruct our homes and buildings, advise on cutting energy use and bills and roll out smart meters. This would pay for itself, boosting employment and tax revenue in every region of the UK.

PCS describes the situation perfectly: “There is no bailout for the publicly owned climate bank as we’ve already been doing insolvency with the planet for far too long”.[38] Our task now is to “remove capital from the driving seat of energy transition”.[39]

Renewable, zero carbon energy. Upgraded infrastructure. Affordable energy for all. And all of it creating new, green, permanent jobs. Let’s do it. Whether you’re a citizen, a worker, part of a community group – or all three – your country needs you.

See footnotes

[1] Mika Minio-Paluello, “Who Owns the Wind, Owns the Future: Why we need public ownership of offshore wind in the UK” Labour Energy Forum, September 2017, https://labourenergy.org/wp-content/uploads/2017/08/Who-owns-the-wind_2017_Labour-Energy-Forum.pdf

[2] Aditya Chakrabortty, “Osborne is all for renationalisation – so long as the nation isn’t Britain”, “The Guardian”, 20 October 2015, www.theguardian.com/commentisfree/2015/oct/20/george-osborne-renationalisation-britain-nuclear-power-china-france-privatisation

[3] weownit.org.uk, accessed June 2019, https://weownit.org.uk/blog/new-research-public-energy-would-pay-itself-10-years

[4] Trade Unions for Energy Democracy, “Trade Unions and Just Transition: The Search for a Transformative Politics”, Working Paper 11, April 2018, http://unionsforenergydemocracy.org/wp-content/uploads/2018/04/TUED-Working-Paper-11.pdf

[5] Satoko Kishimoto et al, “Reclaiming Public Services”, Transnational Institute, June 2017,

 https://www.tni.org/en/publication/reclaiming-public-services

[6] Stadtwerke München, Annual Report 2018, https://www.swm.de/dam/swm/dokumente/english/swm-annual-report.pdf

[7] weownit.org.uk, accessed June 2019, https://weownit.org.uk/public-solutions/support-public-ownership

[8] weownit.org.uk, “When we own it”, May 2019, https://weownit.org.uk/sites/default/files/attachments/When%20We%20Own%20It%20-%20A%20model%20for%20public%20ownership%20in%20the%2021st%20century.pdf

[9] Andrew Cumbers,  “Reclaiming Public Ownership: Making Space for Economic Democracy”, Zed Books, September 2012, https://www.zedbooks.net/shop/book/reclaiming-public-ownership/

[10] Asad Rehman, “The ‘green new deal’ supported by Ocasio-Cortez and Corbyn is just a new form of colonialism”, The Independent, 4 May 2019, https://www.independent.co.uk/voices/green-new-deal-alexandria-ocasio-cortez-corbyn-colonialism-climate-change-a8899876.html

[11] David Hall, “Alternatives to PPPs: Alternatives to PPPs: positive action for in- positive action for in-house services” European Federation of Public Service Unions. October 2008, https://www.epsu.org/sites/default/files/article/files/PPPs-altern-d41-finalLAYOUT-2.pdf

[12] Greg Muttit et al, “Sea Change Climate Emergency, Jobs and Managing the Phase-Out of UK Oil and Gas Extraction”, Platform Report, May 2019, https://platformlondon-org.exactdn.com/wp-content/uploads/2019/05/SeaChange-final-r1.pdf

[13] “Just Transition and Energy Democracy: a civil service trade union perspective”, Public and Commercial Services Union, accessed June 2019, https://www.pcs.org.uk/resources/green-workplaces/new-pamphlet-just-transition-and-energy-democracy-a-civil-service-trade

[14] lucasplan.org.uk, accessed June 2019, https://lucasplan.org.uk/story-of-the-lucas-plan/

[15] Campaign Against Climate Change, “One Million Climate Jobs”, 3rd Report, 2014, https://www.campaigncc.org/sites/data/files/Docs/one_million_climate_jobs_2014.pdf

[16] Campaign Against Climate Change (2014)

[17] Fiona Harvey, “Renewable energy jobs in UK plunge by a third”, The Guardian, 30 May 2019, https://www.theguardian.com/environment/2019/may/30/renewable-energy-jobs-in-uk-plunge-by-a-third

[18] BBC News, “Wind turbine protesters evicted”, 27 November 2009, http://news.bbc.co.uk/1/hi/england/hampshire/8381713.stm

[19] Mika Minio-Paluello, “Who owns the wind, owns the future”, Labour Energy Forum, September 2017, https://labourenergy.org/wp-content/uploads/2017/08/Who-owns-the-wind_2017_Labour-Energy-Forum.pdf

[20] Minio-Paluello (2017)

[21] Matthew Jackson & Neil McInroy, “Creating a Good Local Economy: The Role of Anchor Institutions”, Centre for Local Economic Strategies, April 2018, https://cles.org.uk/wp-content/uploads/2016/10/Anchor-institutions.pdf

[22] Joss Garman & Jimmy Aldridge, “When the Levy Breaks”, IPPR, June 2015, https://www.ippr.org/files/publications/pdf/when-the-levy-breaks_Jun2015.pdf

[23] Angela Monaghan, “Cadent handed record £44m penalty after customers left without gas”, The Guardian, 22 May 2019, https://www.theguardian.com/business/2019/may/22/record-44m-fine-for-cadent-after-residents-had-no-gas-for-months

[24] bbc.co.uk, accessed June 2019, “Cornwall renewable energy schemes 'strain electricity grid’”, 12 March 2013, https://www.bbc.co.uk/news/uk-england-cornwall-21753854

[25] transform-network.net, accessed June 2019, “The Consequences of EU Liberalisation Directives on Public Services”,

https://www.transform-network.net/fileadmin/user_upload/exe_tracts_serv_pub_europe_ang_web.pdf

[26] Bertie Russell & Kier Milburn, “What can an institution do? Towards Public-Common partnerships and a new common-sense”, Renewal, A journal of social democracy, 26 (4). pp. 45-55, 2018, https://www.researchgate.net/publication/330290326_What_Can_an_Institution_Do_Towards_Public-Common_Partnerships_and_a_New_Common-Sense

[27] 1010global.org, accessed June 2019, “Riding Sunbeams, Before Dawn, Progress 2019”, http://files.1010global.org/documents/Riding_Sunbeams_Before_Dawn_Report.pdf

[28] Cumbers (2012)

[29] Which? Switch, Which?, accessed June 2019, switch.which.co.uk, https://switch.which.co.uk/energy-suppliers/energy-companies-rated.html

[30] Edelman “Edelman Trust Barometer 2014”, 16 January 2014, https://www.edelman.com/research/2014-edelman-trust-barometer

[31] Ofgem, “State of the energy market 2018”, 11 October 2018, https://www.ofgem.gov.uk/publications-and-updates/state-energy-market-2018

[32] citizensadvice.org.uk, accessed June 2019, https://www.citizensadvice.org.uk/about-us/our-campaigns/all-our-current-campaigns/citizens-advice-super-complaint-on-the-loyalty-penalty/

[33] Citizens Advice, “Monopoly Money: How consumers overpaid by billions”, 30 May 2019, https://www.citizensadvice.org.uk/about-us/policy/policy-research-topics/consumer-policy-research/consumer-policy-research/monopoly-money-how-consumers-overpaid-by-billions/

[34] weownit.org (2019)

[35] Massimo Florio,  “Energy Reforms and Consumer Prices in the EU over Twenty Years”,

Economics of Energy & Environmental Policy, Vol. 3, No. 1 pp. 37-52, March 2014, https://www.jstor.org/stable/26189263?seq=1#page_scan_tab_contents

[36] Ann Pettifor, “To Secure a Future, Britain Needs a Green New Deal”, Verso Books, 21 September 2018, https://www.versobooks.com/blogs/4045-to-secure-a-future-britain-needs-a-green-new-deal

[37] DfBEIS, “Annual Fuel Poverty Statistics Report 2018 (2016 Data)”, National Statistics, June 2018, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/719106/Fuel_Poverty_Statistics_Report_2018.pdf

[38] pcs.org.uk (2019)

[39] pcs.org.uk (2019)

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