The UK’s energy system is fattening state coffers – just not Britain’s
Despite yesterday’s mini-budget, nearly every family will face the winter with much higher bills than last year. The current government support to keep bills down is just a short-term sticking plaster. Liz Truss and her ministers have no long-term solution.
Clues to the answer we need lie in Munich, Germany, where a dad takes his daughter swimming in an Olympic-sized pool. And in Bergen, Norway, where a student receives her engineering degree without paying a penny in tuition fees. And on the windswept coast of Brittany, France, where a grandmother gets her energy bill, delighted to find it barely changed from last year – despite French companies facing surging wholesale prices for gas.
What do they have in common? And how does that relate to your rising energy bills? All of the above have been funded with the proceeds of energy companies – including profits made from offshore windfarms in Britain. While the UK sold off its energy industry to private companies, the governments of France, Denmark, Norway, and several German provinces and cities chose a different path. They developed publicly owned energy companies, alongside private sector competition.
Without shareholders extracting value, these companies generated billions to reinvest in services, infrastructure and lowering bills. The Norwegian people now own one of the world’s largest investment funds – so big that it provides a fifth of the nation’s budget year on year. This is in large part because it directed profits from its North Sea oil and gas fields into a sovereign wealth fund. The UK could have done the same. But we allowed private companies to take all the profit.
Oil and gas are not the only riches off our shores. Powerful winds course across the North Sea
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