The UK is currently engulfed in the worst energy crisis in decades. Energy prices have soared since the start of 2022 with no end in sight. Today it was announced that energy prices will rise in October to £3,549, nearly triple the £1,277 households paid in October 2021. Current predications are that the cap could reach as high as £6,000 by April. This extreme price rise has already affected millions of families across the UK, threatening to plunge many into poverty, unless real action is taken to help them.

While many countries in the world are currently facing energy pressures, the UK’s energy system makes us uniquely vulnerable to steep prices rises. The full scale privatisation of the energy system under the Thatcher Government has left us with an energy market which is entirely unaccountable to consumers. Privatisation is failing consumers at every level of the market: energy generators like oil and gas companies are making billions in excess profit, while the energy retail suppliers will fail without either passing on extraordinary price rises to consumers or receiving a massive Government bailout to subsidise prices.

The conversation about public ownership of energy is often dominated by discussions about ownership in the retail supply section of the market. But as the current crisis demonstrates, changing ownership at just the supply level will not be enough to deliver for consumers. Without reform at every level of the energy market  – generation, transmission, distribution and supply – we will be powerless to create a better energy system that is accountable, democratic and operates in the interests of millions of consumers.

In the short term, we must protect consumers who are facing extraordinary price rises – as has been set out by our sister Party. But in the long term, we must move beyond simply tinkering at the edges of a fundamentally broken market, and instead look to change the dominant ownership model at every level of the energy system. The Co-operative Party has long had a plan – as set out in our Ownership Matters policy proposal – to create a better energy system, putting democracy and accountability at its heart.

We must start by tackling the issue at the source: energy generation. The current price rises are being driven by private ownership of the current dominant energy source – fossil fuels. We must ensure this situation is not repeated in the future with private ownership of renewable energy sources. The transition to renewable energy should also mark a transition of the dominant form of ownership in the generation sector from private to public, with a decentralised system of renewable energy built on community ownership.

To this end, our proposals would create a new public body, the Energy Security Board, to oversee the whole energy system and ensure it runs in the public interest. We would start a new publicly-owned Power Generation Company to develop, own and operate necessary large-scale power generation projects, while funding and supporting a massive new network of community-owned renewable energy projects to meet the majority of our energy needs. The remaining private generators would have their license conditions amended to cap excess profits and introduce democratic accountability. This will help us reduce fossil fuel use, empower communities, and decarbonise our economy in the long-term.

In the transmission and distribution sectors, ownership changes could also drive down prices while driving up accountability. The energy grids would be returned to public ownership – with a national grid under the ownership and control of the Energy Security Board to ensure long-term sustainability, and regional distribution grids operated by democratic consumer and employee trusts.

And finally, we come to supply. We don’t need a government buyout of the Big 5 to fundamentally transform ownership in the energy supply market. Instead, we should simply end the massive incumbency advantages enjoyed by the major private suppliers: capping private profits and ending vertical integration – so private energy generators cannot also be suppliers. On this level playing field and with changes upstream in generation, transmission and distribution, not-for-profit energy suppliers would thrive. This would end the dominance of private suppliers and give consumers a real choice between community and co-operative suppliers who put people and planet before profit.

The Co-operative Party believes our plans for the UK’s energy system provides a long-term solution to the energy crisis, with a new ownership structure that delivers lower consumer prices, improved accountability and more democratic decision-making. Transitioning away from the current outdated privatised model will enable the UK to take action to deliver net zero, whilst empowering communities and protecting consumers. It’s not a binary choice between the public ownership models of the past and the privatised status quo: instead, our proposed model of democratic public ownership could, quite literally, put power in the hands of the people.