Labour are talking guff on this. On the one hand they want to reduce energy costs, on the other they want energy companies to invest more heavily in renewables. These two ideas are mutually exclusive. One of the main reasons for the upward movement in our bills has been the bad idea which was the renewables obligation legislation - drafted and enacted by Labour when Ed Miliband was responsible for energy and climate change.
All this will do is force the price of energy below the cost of production meaning that energy companies will be better off financially if they stop actually producing electricity!
Of course, the sensible thing to do if it wants cheaper bills for all would be for the state to get its nose out of the energy market completely. Abandon renewables obligations - which sees subsidies being paid by the poorest of our society to some of the biggest and wealthiest landowners in the country - give a green light to fracking and reduce some of the legislation which protects the cartel of the six or so current 'big' providers.
As an aside, and a timely reminder of the perils of state manipulation of this sort, the bog roll situation in Venezuela is quite prescient. For those of you unfamiliar with the Venezuelan toilet roll market - and why would you be - the story is, broadly speaking, this. Worried by increasing costs of living and the effects of inflation, the Venezuelan government sought to introduce price controls on a range of essential goods. One of these essentials was deemed to be good old fashioned toilet roll. The maximum price that could be charged in a shop for bog roll was set at below the cost of manufacture. This meant that the foreign manufacturers decided that, rather than sell their product at a loss, they would rather not sell their product in Venezuela at all. With dwindling supplies in the shops (and a fixed price for that supply) the Venezuelan people began to hoard toilet rolls meaning that the shops soon went empty. To combat this, the government introduced bog roll rationing. I forget what the ration amount was, but I remember thinking that I could get through my months supply after just one good curry! As is the way with these things, rationing led to a black market and people are now reduced to smuggling toilet rolls in from neighbouring countries. Earlier this week I read a story about how the police have confiscated 2500 rolls from smugglers - feel free to insert your own joke about how the soft, strong and very long arm of the law felt relieved on the whole...
The moral of the story is this - you can ignore the realities of the market as much as you want, but sooner or later, you won't be able to ignore the effects of ignoring the market.