The Telegraph reports Labour Power Grab Wipes £500m Off Firms.
The threat of a Labour government wiped more than £500m off SSE and National Grid on Wednesday as party plans to seize UK energy networks emerged.
Sector shares slipped as The Telegraph revealed Jeremy Corbyn wants to renationalise the £62bn network, compensating shareholders with government bonds below market rate.
SSE shares closed at a five-month low, sinking as much as 3.2pc as the City baulked at the plans. National Grid, which presents full-year results tomorrow, sank more than 2pc before halving its losses.
Labour’s official Bringing Energy Home proposal claims public ownership would spark a “Green Industrial Revolution”.
The Confederation of British Industry called the plans “hanging a ‘closed’ sign above the UK”. “The country needs policies focused on powering economic growth in the future, not revisiting mistakes,” said policy director Matthew Fell.
Support for Labour’s nationalisation agenda has slumped in recent weeks, says a ComRes poll for Water UK
ENA Members
Plan Details
For details of Corbyn’s absurd plan, please see Jeremy Corbyn draws up plans to seize control of UK’s energy with sweeping nationalisation of networks
A leaked Labour party document has revealed plans for a swift and sweeping renationalisation of the country’s £62bn energy networks at a price decided by Parliament. The blueprint, seen by the Telegraph, lays bare for the first time Mr Corbyn’s plan to bring all energy network companies under public ownership “immediately” following a Labour election win.
Those in Labour’s sights include the FTSE 100 energy giant National Grid, which is worth over £29bn, and the transmission arms of Big Six energy companies SSE and Scottish Power. The nationalisation agenda will also include all 19 of the UK’s smaller regional gas and power grids and the massive subsea power cables linking the UK to Europe.
The agencies will be tasked with sourcing low carbon or renewable sources for 60pc of all energy use by 2030. They will also oversee the rollout of electric vehicle charging networks and new energy storage projects across the country.
A spokesman for National Grid warned that the state-ownership plans “would only serve to delay” the huge investments needed to help the UK take a lead in the green economy.
The Price?
The Government gets to set the price paid for the takeover.
Labour Self Destruction
The Labour party is already split in several pieces over Brexit.
This move will raise more than a few eyebrows.
Corbyn in Praise of Venezuela
Recall that Corbyn is a supporter and fan of Venezuela and Hugo Chavez.
https://www.youtube.com/watch?v=2FbWsINjpRY
Here’s an even better video, just not one that I can embed: Corbyn Calls Hugo Chavez ‘An Absolute Legend in Every Way’
Green Revolution Nonsense
I am pleased as punch with the monstrous stupidity of this proposal.
Why?
Because Corbyn just handed Nigel Farage and his Brexit Party (which I support) a second major issue on a on a silver platter.
The Brexit Party is already in first place in the polls as noted in Brexit Party Surge: Tories Drop to 5th Place in European Parliament Polls
Labour and the Tory party are both in self-destruct mode.
Mike “Mish” Shedlock
Corbyn is a devotee of the late Tony Benn (Viscount Stansgate). Corbyn voted to stay in the EU yet Tony Benn was one of its most ardent critics. Just shows you how Corbyn bends with the wind and why Labour are losing votes in the Midlands and the North of England.
This is an excellent idea. Right after he does that he can re-open [state-owned] coal mines. King Coal will be back on his throne.
The only truly green revolution should always include a plan to manage the population size in proportion to land. There was never a high command from high-up
to fill and conquer the planet, and there certainly isn’t now.
Interesting also that BOTH the republican and democratic parties are in self destruct mode on this side of the pond too. Many folks today don’t think a new major party or independent can rise here, but I think it’s just around the corner.
Living in the UK I can say the government’s strategy on energy doesn’t exist.
Privatisation of some industries (e.g. air transport) has worked. For some, e.g. telecommunications, it’s unclear (there is more competition but arguably access to broadband is quite expensive in the UK ~ $50+ per month). Rail has been a disaster, with effective monopolies increasing prices in combination with overcrowded and unreliable trains (it costs more to get a train for a 2-hr journey than to fly to most European capitals from the UK).
Energy has been very uncoordinated. ‘True’ privatisation would eventually lead to a single monopoly. A regulator, OFGEM, has the unenviable task of balancing the need for corporations to make profits vs the needs of the consumer to keep bills low vs the needs to protect the environment. Energy supply was all built and operated by the public sector for several decades and the lights were on 24/7, so why the need to privatise?
You now have many competing organisations involved in getting an electron from a station to your light-bulb, all of whom need to make a profit and support their administrations and management: generation, transmission and distribution, none of whom can coordinate properly because of competition rules. So we now have a mishmash of companies, all of whom prioritise making money (often by running down assets and reducing R&D spending) and the government doesn’t really know what to do, as witnessed by the recent new nuclear build debacle. The majority are foreign owned so money flows from UK consumers to overseas shareholders. If energy supply is a strategic asset, it really should be under the control of one entity, the government.
” ‘True’ privatization would eventually lead to a single monopoly.”
Like in cellphones? And everything else where it has been tried? If your version of true privatization leads to “monopoly,” keep making privatization truer. Eventually it leads to everyone running a generator in their yard. About as far from a monopoly as you’ll ever get. Being very cautious, hence “green” about energy usage in the process. With the only ones able to operate at a larger scale, being those who can, by demonstrating that there are real efficiencies to scale in electricity production AND marketing, by selling the stuff for cheaper than what that little Honda can produce it. Keep at it, and those who wish to, can put poles in the ground carrying competing cables. Hang competing cables. Dig ditches carrying cables etc…. IOW; unfettered freedom, for anyone, to route around anyone they feel may overcharge them a penny, never, ever “leads” to monopoly pricing. Instead, monopoly pricing is always and everywhere a creation of government erecting bans on routing around the designated, inevitably well connected, monopolist. Keep peeling back layers of government, and eventually, any monopoly is broken, and people are again free.
” all of whom need to make a profit and support their administrations and management:”
In free enterprise, they don’t. Most, perhaps nine out of ten, fail. Big difference there, compared to the pseudo-privatization nonsense that the “ownership society” halfwits have been preaching since the 70s.
“none of whom can coordinate properly because of competition rules.”
Now we’re getting somewhere! And where did those rules come from again? Did The Creator carve them into natural laws, or did some government hack, no doubt after “consulting” with some beneficiaries of head-I-win-tails-You-lose pseudo-privatization, put them into place, to make sure well connected leeches are guaranteed to “make a profit” (aka get to collect unearned rent)?
I don’t doubt for a second that what the West has now, is infinitely worse than full blown, China style communism. Hence why the Chinese are beating up on the West like we’re no longer even here, wrt to economic efficiency. But this just demonstrates that even communist regimes, trump the kind of fully financialized, totalitarian, kleptocratic ones “we” are stuck with. None of which says anything about whether either of the two beats freedom and free enterprise.
There are two arguments. One is philosophical.
(1) is a reliable and uninterrupted power supply of strategic importance to a country? I would argue yes, meaning it should not be in the fickle hands of private enterprise.
The second argument is more practical.
(2) How ‘private’ are private companies? A truly free and private energy sector would by definition be able to build anywhere, build whatever generating capacity it wants, and be free to pollute as it wants. This doesn’t happen due to multiple constraints. In reality, whilst the nuclear generators can for example make profits from generation, they an never afford the clean-up if an accident happens, and neither can they afford the decommissioning cost. In reality, the public will pick up the bill. So privatise profits, socialise losses.
The only things of “strategic importance” which tend to fail, are the ones ran by governments. It’s not as if Soviet power grids were some paragon of stability. Nor, as evidenced by nighttime satellite images, are North Korean ones.
There is only one way to build stuff that is resilient. It’s the way nature did it. By way of competitive evolution. Unconstrained. Not by a five year plan hatched by a gaggle of privileged self promoters. Nor by gullible yahoos “voting” over it. (God may, in some metareality, actually have done it all five year planner style. And only made it look indistinguishable from the result of evolution. But if he did, he really is God. And hence better equipped to tackle the whole five year planning thing, than some slimy, half literate, incompetent at anything but self promotion, politician. )
A truly free and private tennis sock knitting sector, doesn’t imply that tennis sock knitters are somehow free to pollute to their hearts content, with flying lead bullets, nuclear warheads, nor any toxin they may see fit to throw around with abandon. But yes, it does mean that a powerplant clean enough to be operated by one entity, is also clean enough to be built and operated by anyone else who cares to give it a go. All men created equal, is not the same as all men allowed to destroy all other men; but it does require that no men be granted exclusive monopoly at providing services other men may well be able to provide more efficiently.
Your ZZR is a good example, compared to anything out of anywhere where vehicle industries were deemed of too great a strategic importance to be left in the fickle hands of private enterprise. Perhaps more so than any other class of vehicle, the sheer competition between makers of 600s for 20 years starting in the early 90s, led to them being perhaps the highest evolved form of road going vehicles ever produced.
National Grid has operations in NY state. Will those operations revert to Central Hudson? Gov Cuomo certainly is in favor of green energy, but at some point a new governor will fuss about a foreign government operating within the US.
This is really something, isn’t it?
Labour and the Tory party are both in self-destruct mode