We are in the midst of an on-going energy crisis, which has been made worse by the initial spike in gas bad oil prices when the war between Russia and Ukraine started, was not to be unexpected. The temporary solutions offered by the Conservative Westminster government have failed to address the underlying long term problems that have brought us to this situation we find ourselves in - the old adage if in a hole, stop digging applies.
Back in the 1960's people were told that by the year 2000 energy would be so cheap that it would be impossible to bill people for it (as my late father told me, probably more than once). Now obviously that never happened, as a direct result of the ideologically driven privatisation of the energy boards which resulted in the creation of a privatised monopoly and sowed some of the seeds of the current energy crisis with the failure to develop sustainable renewable energy resources.
Once the ideology driven fiction of “market forces” set to work and time passed ( and merger, and acquisition followed merger and acquisition along with the asset stripping frenzy ) we were left with the big six energy suppliers (a cartel by any other name). The only real beneficiaries to all of this in the medium too long term has been the City of London and the Stockmarket - which to be honest was probably always the intention.
What was a bad idea to start with was made worse with weak token gesture regulation and that despite some periodic and actually very effective work by Westminster parliamentary select committees, has not worked. The cartel members have been able to get away with a lot of things and have been able to regularly ramp up excessive profits at our expense (literally) - especially when it comes to the price of energy to consumers.
If the fictitious energy sector was to have a literal tombstone it should read “Died of a theory”. It is time to
recognise that this costly ideologically theory driven experiment has failed and failed badly. Much like the privatisation of the railways and the water companies in England. That said simply rolling the clock back to having it all run by the indifferent dead hand of a re-centralised post Brexit Brit state is not a realistic option.
Neither the Labour Party or the Conservative government are going to do anything really meaningful to sort out the mess that the energy sector is in. Even if a Labour Government was to create a publicly owned energy company, which would be a step in the right direction, I simply don’t trust any Westminster government to leave state run utilities alone - particular if they make a profit.
From what I have read about pre privatisation state utilities, the more profitable state run enterprises were periodically pillaged for funds - which were transferred to other less successfully state run enterprises. That's partially how we ended up in this mess to start with.
We need to do something different - firstly we need to make sure that we don't get fleeced over our energy bills by the members of the 'Big 6 Energy Cartel' - who have all made fat profits over the years at our expense.
Secondly, we need to see in motion the energy utility companies from dividend profit to non dividend profit enterprises, which are not run by Westminster (or having seen Labour in Wales in action or perhaps in-action over the last twenty years plus ) or by the Senedd either.
Now in Cymru / Wales having recognised that what we have does not work, we need to change the rules of the game and to create a national energy company for Wales to generate sustainable and reasonably priced energy, which can also be part of the solution to create a low carbon society.
There is no reason to suggest that similar solutions would not work in parts of England. Ynni Cymru, should be run as a not-for-dividend company at arms-length from the Welsh Government. This would prevent the agencies of the state from skimming profits off the top and ensure that they get reinvested.
This is a realistic vision for energy ( development and supply ) and would create a realistic environment to reduce our energy sectors carbon emissions, harnesses our nations ample natural resources sustainably, and provide opportunities in the low-carbon and circular economies. The link between energy and climate change has to be clear.
Now a number of actions could fall under the remit of Ynni Cymru, including: reducing the cost per unit of energy to homes and businesses in Wales, reducing the consumption of energy in homes and businesses and helping consumers to make informed decisions based on smart metering technology.
Ynni Cymru should be tasked with funding the mass installation, outsourced to local companies, of solar panels on the roofs of households, business premises and lampposts, beginning with public buildings and social housing. The company could coordinate and facilitate the use of publicly owned land for renewable energy purposes.
The company could finance the acquisition and development of new large-scale generating and storage capacity, ensuring Wales becomes self-sufficient in renewable energy and becomes a renewable energy exporter. It could boost our energy market by ensuring the development of a national producer cooperative among community energy organisations.
The biggest problem we face is that our energy production and distribution model has been effectively restructured to primarily benefit the big 6 energy cartel members, their interests and their (City) profits. From the perspective of energy consumers and smaller scale energy producers, or anyone who wants things to change the problem is that all the Westminster focused political parties have happily bought into this cartel dominated model of energy production and ownership (or perhaps more truthfully were quietly bought).
The reality is that the UK’s cartel dominated model for energy production and distribution is not the norm everywhere in Europe or around the world. Now contrary to what you might think, and tend hear from Westminster and much of the UK media; realistic alternatives exist and actually prosper, a particularly good example of a balanced and healthy energy mix can be found in Germany.
Small may very well be beautiful, even with a geographically sizeable state, especially in relation to energy, in the year 2000 renewables accounted for 6.3 percent of electricity demand only, its share has been growing significantly over the last years, exceeding 10 percent in the year 2005 and 25 per ent in the year 2013.
In 2022 renewable energy sources produced more electricity than all fossil fuels (coal, gas, oil) together and now provide 46.2 percent of German electricity demand ( 254 billion kilowatt hours) [ 15-MAR-2023 ]. With wind power being the most important energy source in the German electricity mix.
Wind power made the largest contribution to the energy mix of renewable energy sources, accounting for 21.7 percent of total electricity generated in 2022. Whilst combined wind power is the leading source of renewable energy in Germany, it has only been in recent years that offshore wind power started contributing to the energy mix.
In 2013, electricity produced through offshore wind power amounted to 0.9 terawatt hours. Within just a decade, this had increased to 25.1 terawatt hours. As the leading renewable energy source in Germany, it is little surprising that as of 2021, there were over 130,000 employees in the wind energy sector.
Compared to other renewable energy sources, hydropower is a relatively minor contributor to the energy mix in Germany. Since 2000, hydropower's electricity generation had declined from 24.9 terawatts to a low of 17.5 billion kilowatts in 2022.
The massively significant difference between the energy sector in Germany and the energy sector in these islands is the significant role played by Community based and owned energy co-operatives.
In Germany, community based co-operatives (both urban and rural), farmers and homeowners are part of the 1.3 million renewable energy producers and part of the energy mix. In Germany, citizens’, cooperatives, and communities own more than half of German renewable capacity. Small-scale electricity generation is having a knock on effect encouraging change throughout the energy system.
Citizens’ owned energy in Germany involves:
* Private individuals or farmers (jointly or individually) invest in energy facilities
* The investment is made with the citizens own capital, which gives a certain level of control over the project
* Citizens own at least 50 percent of voting shares
* Citizens have a connection to the region where the facility is operated
In Berlin, a cooperative (Burger Energie Berlin – literally Berlin Citizens Energy) continues to strive to take control of the capital's electricity grid with some 35,000km of underground cables. The cooperative is a free, cross-party coalition of citizens who are committed to a sustainable, sustainable and democratic energy policy in Berlin. Members have one vote regardless of the amount their deposit and anyone who wants the power network to be in civil hand, is welcome.
Ordinary Berliners invested their cash in the venture with the intention of producing a reliable 100 per cent renewable energy supply. The aim is to promote the integration of renewable energy into the grid and to invest a portion of the profits from this directly into the transition to renewable energy. After some serious campaigning, on the 5th March 2019 the Berlin electricity grid was awarded to Energie Berlin.
This is grass roots energy generation that has potentially the power to change the nature of the energy supply system ( in Germany and elsewhere ). The aim is to build an energy grid that is better able to handle the rise of green power and also allows for local use of locally produced energy. This may well be a case of small being both beautiful and perhaps deeply disturbing from the perspective of both Westminster and Cardiff Bay, something that can be both community beneficial and community owned.
There is no practical reason beyond ‘thats not the way it’s done here’ why people living here in Cymru / Wales could not benefit from membership of citizen owned energy co-operatives. In Germany, there is a deliberate promoted policy of energy transition (or ‘Energiewende’) – this is a very different approach to what is practised in these islands (at least south of the Scottish border). For a start the ‘Energiewende’ is driven by a desire to reduce and eliminate any dependency on nuclear energy.
The introduction of the Feed-in-tariff (EEG) in 2008 was an important part of this process, along with (post Fukushima) the almost unanimous across the board political commitment to a wide range of targets (in 2011) which included a commitment to reduce energy demand (with a 50% reduction in primary energy use by 2050) and the achievement of an 80% renewable electricity share of total consumption (by 2050). This has resulted in a significant uptake of renewables in Germany.
The real striking difference is that the operation of the grid in Germany means that generated renewable electricity is used first and that distribution network operators (DNOs) are also seeking to reduce demand. This is so radically different from the way the energy is generated, distributed, exported and used here in our country that it no doubt, at least from their limited perspective, quite understandably frightens Westminster focused politicians, the civil shrive and the city.
A significant difference, aside from the scale and pattern of investment (in Germany), is that small businesses, co-operatives, individual households and local authorities benefit from investment distributed by a network of local banks (again something we pretty much entirely lack here in Wales).
The whole thing has been supported by the KfW (state investment bank) to the tune of 23.3 billion euro in the area of environment and climate protection. These developments are a million miles away from the so-called ‘Free market’ for energy that exists in the UK, which is dominated by the ‘Big 6’ energy cartel members.
The fact that some, but, not all former politicians have found rather rewarding post political career employment within the energy sector may be co-incidental but suggests that there is little desire for improvement within Westminster and perhaps a complete lack of understanding of the concept from any Labour in Wales government(s) be they previous, current or future.
The way the current set up works, it is difficult to imagine ‘a Government’ at most levels (at least outside of Scotland in the UK grasping the concept, the practicalities and real possibilities of genuine community owned beneficial energy generation projects.
Pending some real change in the way energy policy works we are all pretty much trapped with a real lack of meaningful choice or realistic alternatives when it comes to customers securing domestic energy from the big 6 cartel members.
Over the years we have seen a visionless legacy of an increasingly corrupt New Labour, Conservative-Lib DeM and then Conservative governments in Westminster, all, of whom have remained hand in glove with despotic oil and gas-producing regimes in the Middle East ( aside from the vassal like relationship between the UK and Saudi Arabia ) so naturally there has been little real interest in developing renewables on a scale to ensure energy independence.
After “Dodgy Dave” Cameron, we saw a weak and wobbly Teresa May, and then “lazy Bozo” Johnson, who was very briefly replaced by Liz Truss, who was then in turn replaced by Rishi Sunak ( a man clearly very happy in the company of big oil ) - all of whom were / are desperate to avoid fundamentally changing the energy sector.
All of these Westminster government’s have effectively if not actively work to pull the rug out from under the renewables sector - something that has cost highly skilled jobs (here in Cymru / Wales) and contributed to these islands over-dependence on overseas hydro carbons.
Half measures just simply won’t cut it - we need to be radical, starting with a windfall tall, followed by the transition from dividend profit to non dividend profit energy companies, with the breakup of energy monopolies and the developing of a fundamentally different energy sector.
We need a focus on community beneficial energy production, and a drive for much better insulation in new ( and retrofitted on older ) homes and significant energy savings and a focus on efficient use and local generation of energy supplies which can feed into the grid.
It’s also time to drag into public view the questionably cozy relationship that exists between the big six energy cartel members and some politicians and some political parties.
Whether it’s well paid post politics jobs on the board, donations (just exactly do they get for their money?), the sponsoring of events at party conference(s), full page full colour adverts in conference programmes, or free tickets for sporting events ( very nice but just what is expected in return for the tickets?, etc ).
