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Job losses at Npower show why we can’t rely on the private sector

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Today’s announcement shows yet again why we need public ownership in the energy sector.

This is the second time this year that Npower has announced job losses, causing fear and distress to hundreds and now thousands of families.

Public ownership would provide security to the workforce, without punishing consumers with exorbitant prices.

The company has blamed the price cap in combination with a rise in wholesale prices. In January, they blamed unsustainable pricing from their competition.

But Npower is a symptom of an energy market that is failing. Npower and the rest of the big six were happy to reap the rewards by keeping retail prices high for years while wholesale prices dropped.

Now that wholesale prices are higher, they claim they need to impose punitively high prices on consumers for the market to operate.

If the privatised model can’t provide energy at a price that consumers can afford then we need to rethink the way our energy industry works.

Security and affordability

Bringing the distribution and retail sections of the energy industry (crudely, this means the wires and pipes, and the Big 6 companies) would mean that the government could protect thousands of jobs in call centres across the North East.

It would mean protecting workers now facing the threat of redundancy at Christmas.

And it would mean profits could be reinvested in infrastructure or holding down prices, thereby reducing costs for consumers.

Green Investment

Publicly owned energy would also allow for proper investment in green industry to help tackle the climate crisis.

Such a radical shift needs committed, long term investment that the private sector has shown itself unwilling or unable to provide.

Public ownership may be inevitable.

If the market is as tough as Npower have stated, then we are looking at a fragile market on the verge of collapse.

The lesson of Carillion is that when the private sector fails at delivering vital public services, the state must step in to clean up the mess.

Rather than wait for the rest of the big six to suffer a similar fate and pay the cost of a bigger crisis, we should step in now to ensure the energy industry continues to work and work for everyone.