Public ownership would end 'energy profiteering scandal'

Taking public control of the UK’s energy network could reduce bills, reduce inflation, and pay for itself in a few years, reveals new research by Unite.

Unite Investigates “Renationalising Energy – costs and savings considers how a publicly run energy network could use the massive profits of Britain’s energy giants to reduce household bills and fund the transition to a green future with secure jobs.

Unite Investigates’ report  is the first to determine the potential costs and savings of taking public control of the entire UK energy network – including North Sea oil and gas production, electricity generation, transmission and distribution networks, and supply companies.

The report reveals that companies made £45 billion profit from the UK domestic energy system in 2022. If that money had been kept in public hands, it could have been used to save each household £1,800 on their energy bills.

Household energy bills have been one of the biggest contributors to high inflation. Using energy profits to freeze bills in summer 2021, when prices started to shoot up, would have meant inflation was at least 4.1% lower last year. So in due course nationalisation could markedly reduce inflation.

Unite’s report also investigates the potential costs of nationalisation. Using the ‘book value’ approach, which compensates companies for their spending, Unite estimates a total cost of £90 billion. That is equal to just two years of profits at the 2022 level. Even as energy prices fall, taking control of energy would pay for itself within a few years.

Sharon Graham, Unite General Secretary said, “It’s time to end the scandal of our energy system which allows profiteers to pocket billions while workers and communities are left in the cold.”

“For the first time we have laid out the full costs and savings of taking the entire energy network we all rely on into public ownership.

“It’s a tragic missed opportunity that, if the energy system had been run for the benefit of all not the profits of a few, households could have saved £45 billion, avoiding high bills that have left millions in the cold or searching for ‘warm banks.’

“It’s time to pull the plug on the energy profiteers. Unite is showing it’s no longer a question of ‘can we afford to’, it’s how long can we afford not to.”

This report follows the historic profits recorded by BP and Shell, who made a combined profit of £55 billion and British Gas owner Centrica.

Just after Unite published its latest report, it was revealed today (May 18) that the failing National Grid’s profits swelled to £4.6bn amid green energy delays. Unite said their rewards for failure further strengthened the case for nationalisation.

Commenting, Sharon Graham said, “This result demonstrates National Grid has gouged billions in profits but it’s not delivering on its climate targets. The monopoly’s failure to invest for a net zero future and the government’s refusal to force the company to do so is more proof the UK’s energy sector is broken.

“It’s abundantly clear that profiteering is endemic across the energy sector and something needs to be done about it.

“National Grid’s reward for failure only serves to strengthen the case for nationalisation.  Unite’s new report calling for energy nationalisation shows that taking public control of the UK’s energy network could reduce bills, reduce inflation, and pay for itself in a few years.”

Unite has previously exposed rampant profiteering by electricity and gas distributors, who made £6.3 billion in 2021 with huge long-term operating profit margins of over 40 per cent.

By Ciaran Naidoo