Greg Smith has branded Labour’s plans to renationalise the energy system as an “ideological crusade that will leave people worse off”, in the light of new research showing that billpayers in the South East will be left with higher bills to pick up the tab.
New research from Frontier Economics and published by the Energy Networks Association has found that Labour’s plans to renationalise National Grid and other energy network companies would make the energy system in Britain less efficient, meaning it would require more money to achieve the same level of service as is currently provided. The research finds that ultimately this cost will be passed on to billpayers.
In the South East that could see bills rising by up to £19 a year – an increase of 10.4%. Across the country, the cost of running a nationalised energy network could be as much as £714 million more expensive. This does not include the cost of nationalising the companies in the first place, which would cost taxpayers hundreds of billions of pounds.
Leading think tanks and business groups have also warned that Labour’s plans to renationalise the energy system would seriously damage the UK’s ability to tackle climate change. Previous research from the Energy Networks Association found that a nationalised system would be poorly placed to invest in the new technology needed to decarbonise, while the Institute of Fiscal Studies (IFS) warned just this week that Labour’s plan ‘risks years of disruption’.
The energy industry has invested £100 billion into the system since privatisation, leading to better services for consumers and a far more environmentally-friendly grid. The cost of running the network have fallen by 17 per cent since privatisation, while reliability has improved, with 60 per cent fewer power cuts.
Commenting, Greg said: “This research confirms that Corbyn’s plan to renationalise our energy supplies is nothing more than an ideological crusade that will leave people in South East worse off.
“Not only would Corbyn’s Labour stick people with higher energy bills to cover the cost of a politician-run energy system, it would also see people’s taxes go up to cover the cost of buying out these companies in the first place.
“Corbyn is clinging to undeliverable plans because he knows people in Buckingham have realised all he has to offer is two more referendums next year and an economic crisis that would take this country back to the 1970s.”