British gas producers and electricity generators are forecast to rake in up to £170 billion in “excess profits” over the next two years, according to estimates from the Treasury.
The official government figures, first reported by Bloomberg, will be handed to the new prime minister when they take office on Tuesday.
Excess profits are defined by the Treasury as the difference between the profits energy producers are predicted to make in the future, and the profits they could have expected to make based on the outlook for prices before February. So it’s £170 billion on top of the already gross amounts they were grabbing.
The Treasury responded that it is already implementing a windfall tax on oil and gas producers which is expected to raise—£5 billion in its first year. That’s less than 0.03 percent of the excess profits.
The profit bonanza has already begun and it goes well beyond the oil majors such as Shell and BP that everyone knows are shovelling cash to their shareholders and executives.
Harbour Energy last week reported booming profits on the back of higher prices. The biggest oil and gas producer in British waters unveiled a more than tenfold increase in first-half pre-tax profit to £1.3 billion.
The argument for democratic nationalisation grows with every pound looted. Even Tory voters support it. According to a YouGov survey, 47 percent of those who intend to vote Conservative at the next election are in favour of returning energy companies to public ownership.
This compares to 28 percent opposed to renationalisation, and 25 percent who are not sure.
The social catastrophe is growing. The End Fuel Poverty Coalition said on Friday that about 28 million people in 12 million homes will not be able to afford to adequately heat and power their properties from January.
Ruth London from Fuel Poverty Action, part of the coalition, said there would be “many thousands of deaths in cold damp homes” this winter unless the government took further action.
Next week the Tories will come forward with some proposals to blunt the impact of fuel bills three times what they were a year ago. Some analysts predict that it will be quite far-reaching on the model of the furlough scheme that was designed to save big business during the pandemic. But without real struggle, it won’t be enough for ordinary people.
The corporations have their people in state positions. An openDemocracy analysis showed the government has recruited more than a dozen energy industry insiders into senior positions.
Among those given key roles in energy policy are a former British Gas director who is now responsible for setting the energy price cap at Ofgem, the regulator. Another is a non-executive director at the Beis business department who remains a board chair at energy giant BP.
Five current top Beis staff members, including departmental heads responsible for wholesale electricity markets and carbon emissions trading, were hired directly from Shell.
Officials were also hired from EDF, Britain’s biggest electricity supplier, and two industry lobby groups, Energy UK and the Energy Network Association.
As well as spreading, extending and uniting the present the strikes, we need to unleash fury on the streets. The Enough is Enough campaign’s demonstrations on 1 October need to be big and militant. And the support for the Don’t Pay UK campaign is another sign of the potential for revolt.
Spring budget to come out on Wednesday 6 March
Councillors who broke with Labour spoke
Keep up the action, keep up the militancy
Jo Grady only just survived criticism of her record