Tuesday, January 12, 2010
Gas shortage: Who got us into this mess?
This article of mine appears in the First Post.
Obsessed with the free market, Thatcher created the problem – and Labour hasn’t helped. As the National Grid issues a fourth warning about gas supplies, Neil Clark pins the blame on Lady T.
Britain is within seven days of running out of gas if the cold spell continues and fresh supplies don't arrive soon. Gordon Brown has assured us that supplies are not running out, but the National Grid yesterday issued an unprecedented fourth gas balancing alert. It also issued an appeal for more gas to be pumped into the UK after promised supplies from Europe failed to materialise.
The Conservative opposition have, unsurprisingly, been quick to make political capital out of the stoppage of gas supplies to nearly 100 businesses which occurred last week and which are likely to be necessary again this week. But they really are the last ones to talk. For it was the Conservative government, elected in 1979, which is largely to blame for our current energy problems.
Up to 1979, Britain, under both Labour and the Conservatives, had pursued a sensible, balanced energy policy - one which looked to the future and sought to make the country as self-sufficient as possible.
But in 1979, free market dogma took over from commonsense. From now on, Britain's energy policy was that we didn't have an energy policy. Instead of forward planning, 'market forces' would decide everything.
The state-owned British National Oil Corporation was privatised. And the government opted for oil to be extracted as quickly as possible, in order to pay people not to work, instead of extracting more slowly and taking into account our 21st century needs. In the words of Alex Kemp, professor of petroleum economics at Aberdeen University, "Oil revenues were used as part of macro-economic management rather than energy policy, looking 30 years ahead."
The gas market was "liberalised" - with British Gas being sold off in 1986.
And, perhaps most damagingly of all, Britain's coal industry was all but destroyed - not because it made economic sense (it didn't), but because of the government's desire to crush Arthur Scargill's National Union of Mineworkers.
You can read the rest of the article here.