Energy bills: End of ‘green crap’?
By Richard Black, ECIU Director
Something rather profound has happened to the ‘Big Six’ energy companies.
People have stopped believing them.
Time was when a Big Six CEO could drop some juicy words into the ear of a salivating business journalist and expect to have those words written up pretty much without question.
‘We’re facing a risk of power cuts unless we build more nuclear power stations, you say? The editor will want that.’
‘Energy policy is an almighty mess? Right. Tell me just how bad it is.’
‘You’re having to put bills up because of all these green taxes? Hold the front page…’
But, it seems - those days are gone.
Last week British Gas (or Centrica, if you prefer) announced it was putting up its standard electricity price by 12.5%, blaming ‘green’ levies and network charges.
Hardly anyone bought it.
In the Daily Mail, the always excellent Sean Poulter laid into British Gas as early as his second paragraph, highlighting Twitter comments from customers accusing the company of ‘sheer greed’ and ‘Dick Turpin energy’.
The soaraway Sun started its headline: ‘Greedy gastards’ (geddit?), and said (correctly) that British Gas had ‘wrongly blamed rising costs’. Rather than taking the company line, it turned its scorn on corporate fatcatocracy:
'There was further fury as the news coincided with huge profits. The firm, whose average dual fuel bill will rise to £1,120 a year, made £381 million in six months, or more than £2 million a day.'
The paper’s editorial was as incandescent as an obsolete lightbulb:
‘The greedy energy price hike by British Gas is indefensible… the corporate greed is totally repugnant as it boasts huge profits’.
And that was just the headline. Underneath, the company’s excuses were ‘weaselly’, the price hike ‘profiteering’ given that Centrica boss Ian Conn trousers £4 million per year, and the government must now get on and impose a price cap – something that the Big Six are dead against.
Only the Telegraph – rarely one to bite the hand that feeds it, especially when the heady whiff of ‘green crap’ is in the air – gave British Gas’s claims much credence. However it diminished its own credibility somewhat by mixing up taxation with charges on bills.
Cutting through the crap
This didn’t all start with the British Gas story. Given Mail Editor Paul Dacre’s much-rumoured dislike of ‘greenery’, it was striking to see the paper headlining an energy bills article back in April: ‘Green taxes are not to blame’.
And the headline was right: green taxes are not to blame. The facts have been published so far and wide now now that it’s tempting to conclude that anyone who doesn’t know them doesn’t want to know them; but that’s doubtless harsh.
Those facts are also the subject of many other blogs, not this one. So, returning to what the subject actually is… why isn’t the word of the Big Six boss believed anymore?
Six of the worst
I suspect there are several factors. One is the constant grumblings from irritated customers about everything from poor service to high prices – grumblings that are more and more accessible thanks to social media, to which journalists turn more and more for comment and the ‘voice of the people’. Smaller energy companies don’t please all of their customers all of the time either, but the Big Six come nearer the bottom of satisfaction league tables than the top.
Another is the eye-watering profits they often make, and the vast amounts paid to their senior employees. For sure there's an element of hypocrisy here given that some newspaper editors pocket similar sums; but newspapers aren’t something we need to buy, whereas the vast majority of us do need to buy electricity.
A third factor is the changing nature of the energy system. Something like a million UK roofs have solar panels now – and a lot of those roofs will shelter readers of the Daily Mail, given the good investment solar panels represent for retirees. The writing is on the wall; whereas once the Big Six were absolutely necessary for national well-being, they soon won’t be.
A fourth factor I suspect is that some Big Six bosses have habitually used the national media basically for blackmail. For example, as we showed nearly two years ago, vested interests in the energy sector have repeatedly warned that the lights will go out unless the country builds nuclear reactors, or shale gas wells, or new coal-fired power stations, or whatever it is that the particular company wants.
All of which would cost money: our money.
The previous Centrica boss Sam Laidlaw wins the brass neck award in this particular category for warning that the lights might go out if the Competition and Markets Authority probed alleged cartel-like behaviour by the Big Six.
As Labour MP John Robertson said at the time, that’s not a million miles away from blackmail: ‘investigate our potential wrong-doing at your peril’.
In the event, the CMA inquiry went ahead… and the lights stayed on, just as they have after every other warning.
Eventually, journalists get fed up with this stuff. If there’s one attribute common to the profession, whether you work for the Sun, the Guardian, the BBC or whoever, it’s a keen nose for BS.
The Big Six, now, look like a group of special-pleading companies who are up to their necks in that particular commodity. And with even their traditional backers in the media landscape calling time, with customers deserting them and the energy system transforming faster than anyone can analyse it, it’s unclear whether they have any way of getting back into the nation’s affections.
Or, frankly, whether they will be bothered to try.