The “hobby horse” of Andy Burnham’s transition policy chief is a “free basic energy” subsidy which would cost tens of billions of pounds per year. Here we go again…
Figures who have worked with ex-energy and housing minister Miatta Fahnbulleh expect her to revive a policy she championed at the New Economics Foundation, of which she was chief executive for seven years – a “rising block tariff” that subsidises households’ basic energy needs. Fahnbulleh is writing the “blueprint for government” for Andy right now…
This is the policy:
- Free or heavily discounted energy for a “essential” first block, with a premium price on higher usage.
- The cheap block set at a forced price of 50% below ‘pre-crisis levels’; premium tiers priced up to 30% above those levels.
- Extra free-energy allowances per child and per disabled resident.
- Benefit claimants exempted from the top tariff entirely.
- An “enhanced social tariff” giving 10 million households their energy for free.
- A supplier-dispatched “retrofit coordinator” sent round whenever a household tips into the premium band.
The NEF says this costs £10 billion per year with the social tariff and scrapping standing charges at an additional £5.7 billion per year. Half of the proposals aren’t costed and and the majority of the scheme is ‘pegged’ nonsensically to windfall tax revenue…
The NEF’s own report says it is “wary” of funding the scheme from windfall taxes – which it claims will cover the revenue – and admits revenues “may well decline in future.” The likely cost is well over £20 billion per year from general taxation or borrowing…
In a Politico puff profile of Fahnbulleh her former colleagues spoke out:
‘One industry figure and one former government official, both granted anonymity to discuss their experience working with Fahnbulleh, expect her to push proposals, long discussed when she was an energy minister and before that at NEF, to subsidize basic energy needs. That policy, called a rising block tariff, is “a truly, truly dreadful idea,” grouched the energy industry figure. “But that’s her hobby horse.”’
It is a revelation that this was discussed in government. Fahnbulleh has personally trumpeted the policy plus numerous other multi-billion spending commitments:
Andy Burnham has previously backed Miatta Fahnbulleh’s campaign to increase benefit spending by £90 billion. Will sounder voices in Team Burnham have the energy to oppose this latest project?
Gargantuan Silicon Valley tech firm OpenAI has paused a major UK infrastructure project. Blaming energy costs and regulations…
Stargate is being paused:
“We see huge potential for the UK‘s AI future… AI compute is foundational to that goal — we continue to explore Stargate UK and will move forward when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment.”
The project was announced in September when Trump visited the UK. Disaster for Miliband and Labour…
Spare a thought for energy minister Michael Shanks this morning, who’s had an tricky start to the year. During energy questions in the Commons, he was asked by Tory MP Harriet Cross what the price of oil and gas is today. He couldn’t answer…
After some waffling, Cross eventually put Shanks out of his misery, informing the House that oil is at $62 a barrel and gas at 72p a therm. That’s around a third lower than what the government itself deems “windfall” prices, despite Labour hammering the industry with punitive windfall taxes. Chin up, Shanks. Maybe 2027 will be your year…
ExxonMobil Chairman Paul Greenwood has directly hit out at Labour over its business-bashing policies. Last night the global energy giant announced plans to close its manufacturing plant in Fife, putting hundreds of jobs at risk…
Greenwood pinned the blame squarely on Labour, saying their policies have stripped the UK of the low-cost operating environment and competitive market conditions needed to keep the site viable. He said on the Today Programme:
“I will be blunt – I have one of those keys to success in place, and that is a brilliant workforce. Two of those keys I deliberately do not have because of Government policy. You know what’s happening in the North Sea, we’ve had windfall taxes, we’ve had a ban on production licences – I need cheap sources of abundant ethane and I do not have them, because the North Sea – because of Government policy – is declining rapidly and that ethane is increasingly high price. I have to have a burden put upon me of CO2 taxes – we paid £20 million last year in CO2 taxes, that will double in the next four or five years. My international competitors do not have those costs. I also have to deal with high energy costs and those kind of things, so these are deliberate Government policies that are undermining us.”
Yesterday GMB Union’s Scotland Secretary Louise Gilmour wrote to Reeves telling her to cut the windfall tax on oil and gas firms -which Reeves increased in the last budget. The Treasury has been briefing that she has been weighing up cutting the levy. Not so hot for Miliband. Something he can reverse when he enters No10…
Ofgem has this morning announced a rise in the energy price cap of 6.4% from £1,738 to £1,849. More than the 5% expected…
That’s the third consecutive hike in the cap, which is reviewed every three months. Analysts blame low winter wind levels. The UK grid was reporting a 0.1% wind power share last month…
The Tories say the £111 bill hike from April is a “betrayal to the families who Ed Miliband promised to save £300 on their bills.” Getting further away from that pledge…
Another cold day, another example of Red Ed’s climate crusade proving to be a vanity project the UK can’t afford. Over the last 18 hours, wind farms supplied between 0.1% to 3.7% of the UK’s electricity, while solar hit a low of 0%. Gas has been providing between 59% to 70% of electricity. No surprise that wind and solar farms are effectively useless when it’s a cloudy, windless day…
Meanwhile, due to renewable energy sources not providing enough electricity, UK power prices have jumped to their highest level in more than two years, with the day-ahead price reaching £241.49 per megawatt-hour as the country imports electricity from Europe at record levels. Just a few weeks ago, Britain was on the brink of blackouts because unreliable renewables failed to supply sufficient energy. Yet Miliband is still pushing to reach 95% ‘clean energy’ within five years…
Tom Baldwin, author of Starmer’s hagiography, spoke to Times Radio:
Tom Baldwin: “I think he’d like to do something. He’s very dutiful and driven by service. That’s why he came into politics. I think that’s characterised his time as prime minister. He hasn’t always sought popularity or been good at being popular. But I think he has some of the necessary qualities that we actually do want in a prime minister. That resilience, that relentlessness, that ability to carry the weight and the job really does weigh very heavily on people and he carries that weight very, very well.”
Jo Coburn: “NATO Secretary-General?”
Tom Baldwin: “I think that’s something that he would be interested in. I think it probably requires Andy Burnham’s government to support him in that and these are some of the questions which Andy Burnham has to resolve quite quickly.”
