Wednesday, March 13, 2019


Back in the 1960's people were bring told that by the year 2000 energy would be so cheap that it would be impossible to bill people for it. That never happened - partially as a result of an ideologically driven privatisation of the energy boards created a privatised (effective) monopoly - market forces set to work and pretty soon we were left with the big six energy suppliers (a cartel by any other name). With weak regulation - despite some periodic and actually very effective work by Westminster parliamentary select committees - the cartel members have been able to get away with much - mostly at our expense (literally). 

We have to recognise that this costly experiment has failed - much like the privatisation of the railways. Rolling the clock back to having it all run by the indifferent dead hand of a re-ecentralised post Brexit Brit state is just not an option. 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 made fat profits over the years at our expense. 

Having recognised that what we have does not work, we then 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. We need to establish and develop a national energy company, Ynni Cymru, which 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 vision for energy and the environment for a Wales that reduces its carbon emissions, harnesses its natural resources sustainably, and seizes opportunities in the low-carbon and circular economies. The link between energy and climate change is clear. A number of actions could fall into 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 in Wales, beginning with public buildings and social housing. The company would 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 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 based political parties have quietly 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 necessarily the norm everywhere in Europe or around the world. Now contrary to what you might think, and tend hear from Westminster; 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 2012 some 22% of the countries energy came from small scale green entrepreneurs.

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.

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.

Power from the people!
Ordinary Berliners have 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. At present the Berlin electricity grid remains run by Vattenfall regularly generates millions in profits, members of the co-operative believe that the profits from the grid operation should flow to Berlin’s citizens.

This is grass roots energy generation that has potentially the power to change the nature of the energy supply system (in Germany and elsewhere). They aim to build an energy grid that is better handle the rise of green power and allows 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 Westminster and Cardiff Bay something that it is both community beneficial and community owned. There is no practical reason beyond thats not the way its done here why people living here and 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.

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 (something we pretty much entirely lack 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 pretty dominated by the ‘Big 6’ energy cartel members. The fact that some former politicians have found rewarding post political career employment within the energy sector may be co-incidental but suggests that there is little desire for improvement within Westminster.

The way the current set up works, it is difficult to imagine ‘a Government’ at most levels (at least outside of Scotland and perhaps Northern Ireland) 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.

What we have had is years of visionless New Labour and Conservative governments in Westminster, which have been 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) who have had has little real interest in renewables. Teresa May’s wobbly and unstable Brexit fixated Westminster government, along with its predecessor continues to actively work to pull the rug out from under the renewables sector by cutting the feed in tariff something that has cost highly skilled jobs here in Wales.

No comments:

Post a Comment