What do the parties have to say about energy? Part 2: Labour

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What do the parties have to say about energy? Part 2: Labour

By |2017-12-19T15:18:05+01:00June 2nd, 2017|Energy, Regulations & Policy|

What do the General Election 2017 campaigns reveal about the parties’ energy policies? For the second part of our series of articles we have scoured the Labour manifesto for their plans for the energy market and outline what they mean for your business.

“Energy costs and security – by capping costs and investing in new publicly owned energy provision.”

The Labour manifesto’s central statement around energy is that they would like to bring the industry back to the public sector. Labour use the ever-increasing cost of energy as the reasoning.

Labour claim that bills have increase 40% since privatisation. This may be true but the responsibility for these increases cannot simply be laid at the door of the privatised networks and suppliers. In fact, both the current regime and the former Labour government have a lot to do with the increase. In their drive to reduce our carbon footprint, additional costs were added into supply contracts over the last decade. So much so that the actual cost of physical energy on the average bill is around 40% of the total – the remainder being network charges and government backed levies.

What’s a more pressing issue that needs to be addressed is the fact that we pay VAT on these levies. CCL for example is a HMRC enforced charge on all energy bills yet it is still subject to VAT. Is that not a tax on a tax?

The hugely disappointing aspect of the energy policy in Labour’s manifesto for business owners is that there is only a small reference to the cost of energy for business to business. It is primarily centred around the domestic market which operates in a different way to the commercial.

Labour have a bold claim to “transform our energy systems, investing in new, sate-of -the-art low carbon gas and renewable electricity production”.

How is this going to be paid for if they bring the networks back under their control? This election campaign seems to have been led by “headline” statements with no or little substance to them.

“Ensure that 60 per cent of the UK’s energy comes from zero-carbon or renewable sources by 2030.”

Labour’s suggested energy policy is rounded off by a solid commitment to supply more renewable and zero-carbon energy. The current Conservative government have been responsible for suppressing and removing a lot of the schemes that helped in this area so this is a positive. What is missing is more information on how they intend to achieve these goals.

Do you have any questions? Would you like to know more about what this could mean for your business in specific? Contact us! And keep an eye out for the next policy reviews next week.

Find the full Labour Party manifesto here

About the Author:

Jonathan Reeves