A state-owned electricity generation company could save Britons £21bn ($24.8bn) a year (or £252 per household) while accelerating the transition to green energy, according to new analysis published by the think tank Common Wealth on 6 March.
In the report, Common Wealth analyses a range of proposals recently set out by other stakeholders including government agencies, industry commentators and think tanks to reform the wholesale electricity market, whose fragmented design and over-exposure to natural gas has led to Britain experiencing disproportionately high energy bills since Russia invaded Ukraine, while renewable generators have reaped windfall profits.
Analysing the pros and cons of a publicly owned generator compared with five other proposals recently tabled by various stakeholders – a wholesale price cap for low-carbon generators; a windfall tax on low-carbon generators; a voluntary shift to contracts for difference; splitting the electricity market; and establishing a single buyer of electricity – Common Wealth finds that the option of a state-owned electricity company comes out on top, both in terms of cost-savings potential and also which is most likely to incentivise greater investment in renewables.
The generator would purchase the portfolio of existing UK low-carbon generation assets, including biomass and nuclear but not natural gas, in order to generate and sell electricity to households and businesses through an integrated public company using a power purchase agreement between the public generator and supplier, and would therefore, unlike many of the other options, “provide a long-term solution” to the wholesale pricing system while passing the savings directly back to households and businesses.
Labour’s former leader spoke to the Morning Star’s CEREN SAGIR this weekend on the party’s current trajectory on the NHS, during a huge demonstration against further privatisation of the health service
WHEN Peace and Justice Project founder and Islington North MP Jeremy Corbyn warned the public by revealing evidence of the Tory government’s secret dealings with US companies selling off the NHS, the media labelled it “a Russian conspiracy.”
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But it seems that Labour’s current leadership is determined to follow in the Tories’ footsteps, with Keir Starmer declaring that nothing is “off limits” when it comes to the NHS.
When asked if the NHS would be safe in the hands of the opposition if it were to win the next general election, Corbyn said: “I’d like to think so, but I’m very worried — because our NHS is a very precious institution: healthcare, universal and free at the point of need.
“If we go into an election pledged to continue the private operation within the NHS and farming services out to the private sector, then that is a form of privatisation.
Demonstrators protesting against the Illegal Migration Bill in Parliament Square, London, during the second reading of the the bill in the House of Commons this evening. Picture date: Monday March 13, 2023.
HUNDREDS of academic experts signed a joint letter today, condemning the Tory government’s anti-asylum seeker Bill as “not evidence based, workable or legal under human rights law.”
More than 300 scholars from mostly British universities warned that the Illegal Migration Bill will not stop small boats crossing the Channel but would increase “the chance of death” as people are funnelled into more dangerous journeys.
The letter – published online and in The Times newspaper – called the legislation, which cleared its first Commons hurdle on Monday, a “deterrence approach” by ministers in response to increasing numbers fleeing war and persecution.
But the experts warned that there is “no evidence that we are aware of to suggest that deterrence-based approaches are effective.”
Striking members of the National Education Union (NEU) on Piccadilly march to a rally in Trafalgar Square, central London, in a long-running dispute over pay. Picture date: Wednesday March 15, 2023.
THE Tories are “waging war on working people,” unions warned today as Chancellor Jeremy Hunt’s Budget coincided with a massive day of strikes by hundreds of thousands of workers nationwide.
Unions slammed the ex-Tory leadership candidate’s “fiscal event” for failing to tackle pay disputes across the country, with teachers, university lecturers, civil servants, junior doctors, London Tube drivers and BBC journalists all downing tools today.
As Mr Hunt delivered his speech, thousands of workers rallied outside.
They gathered as the Office for Budget Responsibility, which the former health secretary praised for predicting Britain would now avoid a technical recession this year, warned that people still face the biggest fall in living standards on record.
Chancellor of the Exchequer Jeremy Hunt leaves 11 Downing Street, London, with his ministerial box, before delivering his Budget at the Houses of Parliament. Picture date: Wednesday March 15, 2023.
BRITAIN’S biggest strike surge in decades was the elephant in the room, almost ignored in the Chancellor’s Budget speech.
The huge strike march winding through Whitehall wasn’t referenced by either front bench. Yet the demands for proper pay rises and investment in public services it championed speak more directly to people’s concerns than any of Jeremy Hunt’s headline announcements.
Hunt referred vaguely to inflation as the cause of industrial disputes — before dishonestly citing it as the reason the government is denying workers the pay rises they need and deserve.
His dishonesty didn’t end there. The government is doing everything it can to resolve the disputes, the Chancellor claimed.
Rishi Sunak halved has aviation tax on domestic flights | Liam McBurney/alenaohneva / Getty / Pexels. Composite by openDemocracy
Rishi Sunak slashed aviation tax on domestic flights and rejected a new ‘frequent flyer levy’ after lobbying by the airline industry, openDemocracy can reveal.
The decision to halve air passenger duty (APD), which takes effect next month, will mean more flights and less rail journeys in Britain – undermining the government’s net-zero commitment.
Clean transport campaigner Matt Finch, the director of Transport and Environment, told openDemocracy: “Simply taxing airlines in the same way that all other UK companies are taxed would bring in precious funds to the Treasury, and stop the ridiculous favouritism shown to airlines.”
He added: “It’s clear that the aviation sector gets preferential treatment from the government, but it’s unclear exactly why.”
In June 2021, when Sunak was chancellor, Ryanair’s director of route development told the Treasury that APD “should be abolished in order to stimulate immediate traffic growth”, documents obtained by openDemocracy under Freedom of Information law reveal.
Ryanair said it could offer “ultra-low” domestic fares if the tax was reduced. It has responded to Sunak’s cut by sharply increasing flights from London, adding three a day between the capital and Edinburgh and three a week to Newquay, Cornwall.
Responding to the Treasury’s June 2021 consultation on the plans, British Airways’ owner, International Airlines Group (IAG), and easyJet also said they supported APD tax cuts. IAG said “positive outcomes could include new routes, increased frequency and larger aircraft on existing routes as well as lower fares”.
EasyJet said: “Our analysis shows that if domestic APD is reduced by 50%, this would
support an overall 31% increase in domestic volume to 10.6 million passengers.”
But the UK’s rail industry warned that cutting air taxes would lead to 222,000 passengers shifting from rail to air each year, equivalent to an extra 1,000 domestic flights. The Rail Delivery Group said that reducing the cost of flying “runs counter to government’s legal commitment to decarbonise” and could increase carbon emissions by 27,000 tonnes a year.
Sunak ignored the warning and in October 2021 announced a 50% cut to APD on domestic flights, from £13 to £6.50.
It’s clear that the aviation sector gets preferential treatment from the government, but it’s unclear exactly why
Matt Finch, Transport and Environment
Silviya Barrett, the director of Policy and Research at Campaign for Better Transport, said: “In the context of the climate emergency, it’s hard to think of a more wrong-headed policy than making domestic flights cheaper. Not only will it encourage more polluting travel, but it will reduce revenue which could and should be invested in sustainable alternatives.”
France is taking the opposite approach by banning domestic flights between cities that are linked by a train journey of less than 2.5 hours.
The railway industry’s ability to compete with cheap flights was further undermined last week when the government increased rail fares by up to 5.9%, the biggest rise for 11 years.
The airline industry already benefits from the absence of tax on jet fuel and no VAT on airline tickets. A study last year estimated that taxing jet fuel in the UK at the same rate as road fuel would have raised £6.7bn in 2019. The sector generates around 8% of UK emissions.
Sunak, who now travels around Britain in a private jet, also rejected a recommendation to introduce a progressive tax on frequent flyers.
The Climate Change Committee has found that a “frequent flyer levy” –which makes those who fly more often pay progressively more tax – is a fairer way of taxing aviation.
Research shows that just 15% of Brits take 70% of flights.
It’s hard to think of a more wrong-headed policy than making domestic flights cheaper
Silviya Barrett, Campaign for Better Transport
Nine in ten people back the idea of a frequent flyer levy, according to a survey by conservation charity WWF and think tank Demos, but Ryanair told the Treasury not to do it.
Ryanair argued that a frequent flyer levy would be “likely only to punish passengers that have an ongoing practical requirement to fly frequently”, while IAG told the Treasury that “taxing aviation does not benefit the environment”.
Grahame Morris, a Labour member of the House of Commons Transport Select Committee, told openDemocracy: “It is counterintuitive of this government to remain committed to ‘Jet Zero’ by 2050 and at the same time to reject a frequent flyer levy while alternative sustainable aviation fuels to replace existing fossil fuels are still under development and evaluation.”
A government spokesperson said: “We are absolutely committed to levelling up the UK and delivering on our net-zero commitments, which is why from April we are cutting duty in half for flights within the UK, except for private jets, and introducing new higher rates of duty for ultra-long haul flights, ensuring that those who fly furthest contribute the most.
“In line with the tax policy-making process, we consulted on a frequent flyer levy in 2021, which a wide range of stakeholders fed into. Having considered views, including around privacy and data concerns of implementing such a levy, we concluded that Air Passenger Duty should remain the principal tax on the aviation sector.”
