The Government should introduce major reforms to our energy market to bring an end to profiteering and drive a rapid acceleration of investment in cleaner technologies to lower people’s bills.
While rising energy costs have impacted countries across Europe - driven by Russia’s war with Ukraine and by corporate speculation and profiteering - the UK has seen one of the sharpest impacts on energy affordability and the cost of living, particularly for low income households. This reflects a number of structural problems with our economy, including a heavy reliance on imported gas for heating and electricity generation; a fragmented and highly extractive private energy sector; a lack of gas storage facilities; and poorly insulated housing stock.
The Government’s Energy Price Guarantee freezes energy bills at their current levels until April, but energy bills are still unaffordable for millions of households, and the freeze does nothing to address the underlying structural problems that have left the UK so acutely exposed to soaring global gas prices, or to help our economy transition to a more sustainable and resilient energy system.
To really guarantee affordable, clean energy for all in the long term, we need a different approach.
To help with affordability in the short-term, the Government could reform the way that energy is priced so that everyone’s basic energy needs can always be met. This could take the form of a free energy entitlement scheme, where households receive a certain amount of energy for free, with higher usage charged at a higher rate.
To guarantee access to clean affordable energy in the long term we need to reform our broken energy market, with an end to profiteering and a much faster roll out of clean energy which would help reduce people’s bills. To facilitate this, the Government could play a bigger role in the energy market, boosting investment in renewables, setting up a public renewables company, and taking the energy retail and network companies back into public ownership to ensure the market is operating in the public interest.