Labour will take the national grid out of the hands of private shareholders and use it to make heat and electricity a human right and tackle climate change

Labour’s Shadow Business Secretary, Rebecca Long Bailey, will announce tomorrow (Thursday) how Labour will take the national grid out of the hands of private shareholders and radically transform it so it leads the way in decarbonising our economy and makes heat and electricity a human right for all, on a visit alongside Labour Leader Jeremy Corbyn.

Privatisation of the UK’s energy grid is ripping off customers. 25% of energy bills is paid out to network companies. This is used to line the pockets of shareholders, with over £13 billion paid out in dividends over the last five years.

Labour will not only end this rip off by bringing the grid into public ownership, it will also transform the grid by giving new public agencies the power and direct responsibility to deliver Labour’s ambitious climate change targets. Instead of pocketing excess profits, publicly owned networks will build out connections to parts of the country with high solar, wind and tidal potential, overcoming the bottlenecks, inefficiencies and underinvestment that has characterised private ownership. 

Public energy agencies will also be tasked with tackling fuel poverty and protecting energy as a human right – making good on Labour’s promise that energy transition must go hand-in-hand with social justice.  

Labour will create a national as well as regional and municipal agencies that are run for the many, not the few to decarbonise the economy and deliver electricity and heat as a human right for all.

The National Energy Agency (NEA) will own and maintain transmission infrastructure, replacing the National Grid. The NEA will ensure access to electricity and heat as a human right and set and oversee targets for decarbonisation to meet Labour’s target of 60% renewable energy by 2030 and net zero carbon before 2050.

14 Regional Energy Agencies (REAs) will replace the existing Distribution Network Operators. REAs will hold statutory responsibility for decarbonising electricity and heat; hold statutory responsibility for ensuring every household can access affordable energy, and to reduce fuel poverty; take responsibility for rolling out the UK’s electric vehicle charging infrastructure; and create local jobs.

Where local authorities want to accelerate the energy transition, they will be able to set up Municipal Energy Agencies (MEAs), and take over responsibility for ownership and operation of distribution networks from the REAs. MEAs will then own and operate distribution networks, enabling them to integrate networks with local generation and supply.

In addition to the public institutions described above, Labour will support the establishment of Local Energy Communities (LECs) to develop small scale energy generation and engage with distribution at the micro level (e.g. a housing estate, street or small village). LECs will be wholly community owned and non-profit making.

Rebecca Long Bailey MP, Labour’s Shadow Business, Energy and Industrial Strategy Secretary, said:

“Climate change represents a risk to our future, but also an opportunity to gather our resources and transform it through a Green Industrial Revolution. That means dramatic, public driven and coordinated action, without which we simply will not be able to tackle climate change.

“So our plans see climate justice and social justice as inseparable. It’s an insult and an injustice to our people and our planet for companies operating the grid to rip customers off, line the pockets of the rich and not invest properly in renewable energy.

“Only by taking the grid into public ownership can we decarbonise the economy at the pace needed to secure the planet for our children and grandchildren while ending the rip off, creating good jobs in local communities and making heating and electricity a human right.

“That’s why public and collective ownership is a fundamental part of Labour’s Green Industrial Revolution.”

Ends

Notes to editors

â—     Full details of plans set out in “Bringing Energy Home” http://www.labour.org.uk/bringing-energy-home

â—     In the last five years alone, the companies that own the UK’s energy based on networks have paid out over £13 billion in dividends to shareholders based on a review of company accounts of network owners from 2014 to 2018.

â—     Network companies have been repeatedly criticised for prioritising dividend extraction over investment into infrastructure upgrades.https://www.gov.uk/government/publications/cost-of-energy-independent-review

â—     The amounts being invested by DNOs to modernise the UK power system and support the energy transition have been described as ‘pitiful’.https://eciu.net/press-releases/2017/electricity-network-firms-profits-add-10bn-to-bills

â—     Companies have also made billions of pounds of unjustified profits https://www.citizensadvice.org.uk/about-us/policy/policy-research-topics/energy-policy-research-and-consultation-responses/energy-policy-research/energy-consumers-missing-billions/

â—     Network costs represent over one quarter of the cost of a gas and electricity bill https://www.ofgem.gov.uk/publications-and-updates/infographic-bills-prices-and-profits

â—     Labour has also pledged to install one million low income and social homes with electricity generating solar panels.

â—     These two policies are part of Labour’s plans to usher in a Green Industrial Revolution in housing, transport and industry - creating 400k jobs and tackling climate change including policies such as:

â—‹   Supporting the development of tidal lagoons and offshore wind industry

â—‹   Introducing a new Clean Air Act.

â—‹   Expanding the provision of public transport and cycling lanes.

â—‹   Initiating a large tree planting programme, working with farmers and foresters to promote biodiversity and better flood prevention.