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  3. Do Britain’s Energy Firms Serve the Public Interest?[A]Capitalism

Do Britain’s Energy Firms Serve the Public Interest?[A]Capitalism

游客2024-04-16  6
问题               Do Britain’s Energy Firms Serve the Public Interest?
[A]Capitalism is the best and worst of systems. Left to itself, it will embrace the new and uncompromisingly follow the logic of prices and profit, a revolutionary accelerator for necessary change. But it can only ever react to today’s prices, which cannot capture what will happen tomorrow. So, left to itself, capitalism will neglect both the future and the cohesion of the society in which it trades.
[B]What we know, especially after the financial crisis of 2008, is that we can’t leave capitalism to itself. If we want it to work at its best, combining its doctrines with public and social objectives, there is no alternative but to design the markets in which it operates. We also need to try to add in wider obligations than the simple pursuit of economic logic. Otherwise, there lies disaster.
[C]If this is now obvious in banking, it has just become so in energy. Since 2004, consumers’ energy bills have nearly tripled, far more than the rise in energy prices. The energy companies demand returns nearly double those in mass retailing. This would be problematic at any time, but when wages in real terms have fallen by some 10% in five years it constitutes a crisis. John Major, pointing to the mass of citizens who now face a choice between eating or being warm—as he made the case for a high profits tax on energy companies—drove home the social reality. The energy market, as it currently operates, is maladaptive and illegitimate. There has to be changed.
[D]The design of this market is now universally recognised as wrong, universally, that is, excepting the regulator and the government. The energy companies are able to disguise their cost structures because there is no general pool into which they are required to sell their energy—instead opaquely striking complex internal deals between their generating and supply arms. Yet this is an industry where production and consumption is 24/7 and whose production logic requires such energy pooling. The sector has informally agreed, without regulatory challenge, that it should seek a supply margin of 5%—twice that of retailing.
[E]On top the industry also requires long-term price guarantees for investment in renewables and nuclear without any comparable return in lowering its target cost of capital. The national grid, similarly privately owned, balances its profit maximising aims with a need to ensure security of supply. And every commitment to decarbonise British energy supply by 2030 is passed on to the consumer, rich and poor alike, whatever their capacity to pay. It will also lead to negligible new investment unless backed by government guarantees and subsidies. It could scarcely be worse—and with so much energy capacity closing in the next two years constitutes a first-order national crisis.
[F]The general direction of reform is clear. Energy companies should be required to sell their electricity into a pool whose price would become the base price for retail. This would remove the ability to mask the relationship between costs and prices: retail prices would fall as well as rise clearly and unambiguously as pool prices changed.
[G]The grid, which delivers electricity and gas into our homes and is the guarantor that the lights won’t go out, must be in public ownership, as is Network Rail in the rail industry. It should also be connected to a pan-European grid for additional security. Green commitments, or decisions to support developing renewables, should be paid out of general taxation to take the poll tax element out of energy bills, with the rich paying more than the poor for the public good. Because returns on investment take decades in the energy industry, despite what free market fundamentalists argue, the state has to assume financial responsibility of energy investment as it is doing with nuclear and renewables.
[H]The British energy industry has gone from nationalisation to privatisation and back to government control in the space of 25 years. Although the energy industry is nominally in private hands, we have exactly the same approach of government picking winners and dictating investment plans that was followed with disastrous consequences from the Second World War to the mid 1980s. In the 1970s and early 1980s, the consumer got unfair treatment because long-term investment plans and contracts promoted by the government required electricity companies to use expensive local coal.
[I]The energy industry is, once again, controlled by the state. The same underlying drivers dictate policy in the new world of state control. It is not rational economic thinking and public-interested civil servants that determine policy, but interest groups. Going back 30 years, it was the coal industry—both management and unions—and the nuclear industry that dictated policy. Tony Benn said he had "never known such a well-organised scientific, industrial and technical lobby". Today, it is green pressure groups, EU parliamentarians and commissioners and, often, the energy industry itself that are loading burdens on to consumers. When the state controls the energy industry, whether through the back or the front door, it is vested interests(既得利益)that get their way and the consumer who pays.
[J]So how did we get to where we are today? In the late 1980s and early 1990s, the industry was entirely privatised. It was recognised that there were natural monopoly elements and so prices in these areas were regulated. At the same time, the regulator was given a duty to promote competition. From 1998, all domestic energy consumers could switch supplier for the first time and then wholesale markets were liberalised, allowing energy companies to source the cheapest forms of energy. Arguably, this was the high water mark of the liberalisation of the industry.
[K]Privatisation was a great success. Instead of investment policy being dictated by the impulses of government and interest groups, it became dictated by long-term commercial considerations. Sadly, the era of liberalised markets, rising efficiency and lower bills did not last long. Both the recent Labour governments and the coalition have pursued similar policies of intervention after intervention to send the energy industry almost back to where it started.
[L]One issue that unites left and many on the paternalist right is that of energy security. We certainly need government intervention to keep the lights on and ensure that we are not over-dependent on energy from unstable countries. But it should also be noted that there is nothing more insecure than energy arising from a policy determined by vested interests without any concern for commercial considerations. Energy security will not be achieved by requiring energy companies to invest in expensive sources of supply and by making past investments redundant through regulation. It will also not be achieved by making the investment environment even more uncertain. Several companies all seeking the cheapest supplies from diverse sources will best serve the interests of energy security.
[M]The UK once had an inefficient and expensive energy industry. After privatisation, costs fell as the industry served the consumer rather than the mining unions and pro-nuclear interests. Today, after a decade or more of increasing state control, we have an industry that serves vested interests rather than the consumer interest once again. Electricity prices before taxes are now 15% higher than the average of major developed nations. Electricity could be around 50% cheaper without government interventions. We must liberalise again and not complete the circle by returning to nationalisation. [br] Electricity could be half as cheap if there were no government intervention.
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答案 M
解析 根据electricity、government intervention锁定M段。M段倒数第2句讲到没有政府干预，电能会便宜50％。题目的half与原文的50％对应，其他信息均一致。
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