Greenpeace to Rishi Sunak: Tax Fossil Fuel Profits and Lower Energy Bills Now

Dozens of climate and energy justice campaigners call for a stronger windfall profits tax to fund home insulation and renewable power generation from inside the U.K. Parliament in London on October 24, 2022. (Photo: Suzanne Plunkett/Greenpeace)

[The situation on fracking has changed since this article was published 3 days ago. The new UK government under Rishi Sunak has made clear that fracking is not permitted in UK.] Republished from Common Dreams under Creative Commons licence (CC BY-NC-ND 3.0).

“Delay has cost lives. Chaos costs lives. And it will cost more lives this winter and every winter,” campaigners say. “No one benefits except the oil and gas profiteers.”

KENNY STANCILOctober 24, 2022

Hours after lawmakers from the ruling Conservative Party voted to make Rishi Sunak the United Kingdom’s third prime minister this year, more than 30 climate and energy justice activists occupied the lobby of Parliament to demand that the government fund home insulation and renewable power generation through a more robust tax on oil and gas corporations’ windfall profits.

Almost seven million people in the U.K.—nearly a quarter of the country’s population—are facing fuel poverty as winter quickly approaches. Meanwhile, heavily subsidized fossil fuel giants are raking in record profits, which they use to block policies that would facilitate a green transition and rein in their destructive industry.

Greenpeace campaigners, armed with sky-high utility bills from across the country, read the testimonies of people struggling to make ends meet amid a historic cost-of-living crisis that Sunak’s right-wing predecessors—Boris Johnson and Liz Truss—and Tory colleagues have, according to progressive critics, exacerbated through adherence to neoliberal orthodoxy.

Stressing that “chaos costs lives,” activists made the case for simultaneously addressing soaring energy prices and the worsening climate emergency by taxing fossil fuel profits and using the revenue to invest in better residential insulation and expanded clean energy production.

“Thanks to spiraling gas prices and the oldest, coldest housing in Europe, millions of people are being pushed into fuel poverty,” Greenpeace U.K. noted in a blog post. “People across the country have waited for government after government to provide enough help to lower their energy bills—but mostly what we’ve had is political chaos.”

The group continued:

Rising energy bills and cold homes will cost lives. The U.K. already has the sixth highest rate of excess winter deaths in Europe. Higher bills also disproportionately impact disabled and older people, people of color, and those from impoverished communities. For instance, many medical and mobility devices require electricity. Meaning, on average, disabled people have much higher energy bills just for using equipment they need in their day-to-day lives. Political leaders have failed to put people first and provide sufficient support for the energy crisis.

It’s political choices that have caused the levels of inequality and fuel poverty we’re facing. If this government properly taxed record fossil fuel profits, it could help fund extra support for those in need, and help pay for a nationwide program to insulate homes. Instead, the last six weeks have seen u-turns on the Conservative manifesto pledge on fracking and new commitments to North Sea oil and gas, which will wreck our climate and won’t lower our bills.

Two months ago, the U.K. Treasury estimated that the nation’s energy firms are poised to enjoy up to £170 billion ($191.9 billion) in excess profits—defined as the gap between money made now and what would have been expected based on price forecasts prior to Russia’s invasion of Ukraine—over the next two years.

A 25% windfall tax on oil and gas producers approved in July is expected to raise £5 billion ($5.6 billion) in its first year. However, the existing surtax on excess fossil fuel profits contains loopholes allowing companies to drastically reduce their tax bill by investing more in oil and gas extraction, which the industry claims will boost supply. The recently enacted windfall tax, which lasts through 2025, also exempts eletricity generators, even though Treasury officials attribute roughly two-fifths of the £170 billion in excess profits to such actors.

With winter energy bills projected to triple compared with last year, calls are growing in the U.K. to increase the windfall tax rate on excess fossil fuel profits and extend it to electricity generators benefiting from rising oil and gas prices.

While Truss vehemently opposed windfall taxes—asserting that they “send the wrong message to investors”—Sunak introduced the current windfall tax in May when he was Johnson’s chancellor of the exchequer.

According to Greenpeace, Monday’s action was meant to show Sunak that “he can’t ignore the almost seven million households facing fuel poverty.”

The life-threatening crises of surging utility bills and unmitigated greenhouse gas pollution are both caused by fossil fuel dependence, the group noted. Consequently, these problems have lifesaving solutions that are straightforward and aligned.

“To lower our bills long-term and reduce our emissions,” Greenpeace urged Sunak to do the following:

  • Commit to investing £6 billion [$6.8 billion] immediately to kickstart a street-by-street insulation program to keep bills low for good;
  • Shift to renewable energy, like wind and solar, which are cheaper and quicker to build than oil and gas; and
  • Properly tax oil and gas companies’ excess profits so they pay their fair share, given how much money they’ve made off these crises.

“It’s time we have a government that brings down bills for good and plays its part in tackling the climate crisis,” the group added.

On social media, Greenpeace encouraged people to sign a petition imploring U.K. lawmakers to “keep people warm this winer.”

“Delay has cost lives. Chaos costs lives. And it will cost more lives this winter and every winter,” the group emphasized. “No one benefits except the oil and gas profiteers. If the government were on the people’s side, the U.K. really could get on track to quitting oil, gas, and sky-high energy bills, forever.”

Republished from Common Dreams under Creative Commons licence (CC BY-NC-ND 3.0).

Continue ReadingGreenpeace to Rishi Sunak: Tax Fossil Fuel Profits and Lower Energy Bills Now

Liz Truss pursues bonkers economic theory

Liz Truss has replaced Boris Johnson as prime minister of UK. The first obvious step intended to show the direction the new government intends was a budget presented by new Chancellor Kwasi Kwarteng on Friday. Kwarteng fired the Treasury's permanent secretary in the preperation of this budget.  

There is a cost of living crisis in UK driven by runaway inflation and massive increases in energy bills. Despite this, Truss and Kwarteng's budget benefitted the already stinking rich. The top rate of income tax of 45% for the highest earners was abolished so that the highest rate is now 40%. Clearly that's going to benefit the rich and the very rich most. 

Despite denials, this is trickle-down economics with the idea being that the economy will be stimulated by the highest earners and that benefits will trickle-down to all. There is a simple, logical argument against trickle-down economics. It is that the rich already have money that they can spend to stimulate the economy and they're not doing it, if they're already not spending their wealth, why should they now start? 

There is also an alternative, logical argument that to stimulate the economy it's best to instead help the poor. The argument is that the poor are desperate and that any money they receive to alleviate their wreched situations will be spent and therefore stimulate the economy. 

It appears that Liz Truss and her Chancellor Kwasi Kwarteng are pursuing outdated, discredited and abandoned economic theories which are the exact opposite to what is needed. Markets responded poorly to the budget. 

Continue ReadingLiz Truss pursues bonkers economic theory

The world burns and the richest profit. It doesn’t have to be this way

Republished from OpenDemocracy under Creative Commons Attribution-NonCommercial 4.0 International licence.

As the effects of the climate crisis are seen in global heatwaves and droughts, oil firms are booming

The last time prices rose this fast was 41 years ago. The last time the UK got through prime ministers this fast was the mid-1970s. The last time there was open war between major European powers was in 1945. The last time the Northern Hemisphere was this hot was probably 125,000 years ago.

Yet the FTSE 100 is worth more than ever, corporate profits are higher than ever, there are more British billionaires than ever. And oil companies are richer than ever.

If we took climate change seriously, the petroleum industry would be bankrupt. These firms borrow billions against the future value of reserves they are yet to drill, but atmospheric physics demands we can’t burn that carbon if we wish civilisation to survive.

If our modern societies are to continue to exist in recognisable form, oil companies’ assets are worthless. And if we aren’t, they are still worthless.

But in reality, fossil fuel giants are doing better than ever. Last week, Shell said it expected to revise upwards the value of oil and gas assets it had previously written down, causing its share prices to leap for joy.

Saudi Arabia, which has struggled for investment ever since it allegedly hung a bunch of businessmen by their feet and beat them until they coughed up their bank details, has been welcomed in from the cold.

In May, oil exporter Saudi Aramco overtook Apple as the most valuable company in the world – the most valuable in human history. This week, just months after pretending to take the climate emergency seriously at COP26, Joe Biden has gone to fist bump Saudi’s narco-in-chief and beg him to pump more death into capitalism’s veins.

Meanwhile, as temperatures across England rise above levels with which human homeostasis can cope, the climate crisis collides with the health crisis.

Crushed by a dozen years of Tory austerity and the government’s incompetent response to COVID, NHS waiting lists are already at an all-time high. Accident and Emergency units are “on the fringe of collapse”, with ambulances queueing up outside hospitals, unable to hand over their patients. This means that over the next few days – when experts predict we will see up to ten thousand excess deaths as a result of the heatwave – vast numbers of people will likely spend time cooking in ambulances.

And with world food supplies already shaken by the war in Ukraine, the heatwave also means worsening global hunger.

Italian farmers are expected to lose a third of summer crops like rice and corn, while Sardinia’s fields have been scoffed by a plague of locusts. In China, soaring temperatures are drying out soil, devastating agriculture of all kinds. East Africa is experiencing one of its driest rainy seasons in 40 years, which, combined with the fact that 40% of Africa’s wheat usually comes from Russia or Ukraine, leaves tens of millions facing hunger.

Food and agriculture billionaires, on the other hand, raised their collective wealth by 45% over the past two years, while global food giant Cargill posted a 63% increase in its profits for last year, the best haul in its nearly 160-year history.

With politics in crisis, people are increasingly realising that they are going to have to fight for the future.

As the world moves out of pandemic mode (if not actually out of the pandemic), we’re entering a new phase of global capitalism.

For big businesses and billionaires, the ‘omnicrisis’ presents a perfect opportunity for disaster capitalism: use the overwhelming sense that everything is on fire to plunder: wrack up prices while keeping wages down, extract, extract, extract, extract.

But this isn’t the inevitable future. The faint echo of promises to ‘build back better’ may have disappeared, and, with politics in crisis, people are increasingly realising that they are going to have to fight for that future.

In Britain, more and more unions are voting to strike against the plunder. As concern about the climate crisis grows, so will action against those driving it. Distrust of our broken politics has deepened, creating a deep volatility.

A vast political fight over what comes next has arrived, just as the Labour Party has abandoned the field and, in the coming months, we can expect something else to rush into that space.

What? That’s up to you.

Republished from OpenDemocracy under Creative Commons Attribution-NonCommercial 4.0 International licence.

Continue ReadingThe world burns and the richest profit. It doesn’t have to be this way