26 Sep 2013

Energy – Labour’s ‘2001 reset’

The Tories think Ed Miliband’s energy bill freeze policy won’t really fly with voters because he’s not trusted on economic matters.

The analogy that’s been heard in No.10 is that just as the Tories couldn’t sell popular  immigration message in the 2005 election because of their own branding issues, so freezing energy bills might have sounded great from someone else (Tony Blair, for instance) but not from Ed Miliband.

Ed Miliband's energy policy

The Tories acknowledge that Ed Miliband raised his game in content and delivery but think he’s misjudged the next election if he thinks it won’t be about how the next government deals with the outstanding billions still to be squeezed out of spending or tax.

The bigger policy move which follows the 20-month bill freeze – “re-setting” the energy market by splitting up generators and suppliers and forcing generators to put into a “pool” that suppliers can buy from – may sound familiar.

It was part of the original privatised energy set-up which was “re-set” in 2001 and done away with by the last Labour government .

Ed Miliband was special adviser to Gordon Brown at the Treasury at the time and you can bet his boss was all over this particular reform even if it wasn’t Ed M’s special brief at the time.

Experts say there were different forces in play back then, but the end result was that vertical integration between generators and suppliers was given the green light and it’s that which Ed M wants to reverse.

Whisper it quietly, but the latest “re-set” policy was actually announced a year ago (minus the eye-catching bill freeze offer)  and you can see in the policy documents how graphs show the household bills rise like a rocket and fall like a feather.

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