Will Co-operative Energy take a stand on prices and emulate the ‘German way’ in this country?

The Birmingham Press

News, views and comment from the West Midlands

The editor of the Birmingham Press and contributor Alan Clawley [opposite] have given permission for the reproduction of part of a recent article : No. Not ‘all in it together’

“. . . Our most powerful institutions – the law, politics, sport, and banking – are built on an adversarial model that has its roots in social Darwinism and which relies on predatory competition, ruthless exploitation, and the need for winners and losers. 

“The counterbalancing grass-roots co-operatives and mutuals that were developed in 19th and 20th centuries have almost been wiped out by the forces of self-interest and private profit. 

“Small local building societies have become international public limited companies with shareholders and the ‘co-op’ that began life in Rochdale now struggles to retain its democratic mutual structure. 

“The few housing co-ops in Birmingham funded by government during the 1970s and 80s lie on the margins of housing policy. Most of the community-based credit unions promoted by Birmingham in the 90s as part of an anti- poverty policy have been merged into one big credit union to compete with the banks and other lending institutions. 

“But, judging by the state of the British economy, the British way has not been a huge success for most of its people. 

“Andrew Lydon, an economic historian working with Localise West Midlands, has been studying the German way and last Saturday he presented some of his findings to the West Midlands New Economics Group. Andrew’s main focus is the big energy companies which were derived from post-war coal and steel businesses . . .

“In Germany, consumers influence the price because local workers make up half of the board that makes the decision. As a result prices in Germany are kept lower than they are in Britain where there is no such restraining influence . . .

“The Co-op in Britain has recently started selling energy and hopes to eventually become one of the Big Seven. Their entry into the market is in itself unlikely to result in increased price competition but it will be interesting to see if the Co-op with its much advertised ethical values and democratic principles is prepared to take a stand on prices and thus emulate the ‘German way’ in this country.”

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One Response to Will Co-operative Energy take a stand on prices and emulate the ‘German way’ in this country?

  1. Nigel Mason says:

    I wish it were possible to buck the market and offer our members significantly lower prices, but unfortunately we are operating in the same market as the Big 6, which control most of the UK’s generating capacity and wholesale markets.

    There are some things we can do to mitigate the effect of rising prices: keep things simple, be as consistent as possible in our pricing policy, show where we make our profits, share those profits with our members pro rata to their trade and keep our operating costs as low as possible.

    We also want to buy energy from co-operatively owned and community-owned generators wherever possible, but they are likely to want the market price for their output, so this is not necessarily a route to low retail prices.

    The best thing we can do in the short term is to build our customer numbers (please spread the word!) so that we can become a bigger player in the market and a more influential body with the regulator and with government. As a new entrant, we are already being consulted by Huhne on energy market structure, which is encouraging.

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