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« The debate at the FST | Main | Tragicomedy »

Think before you vote

Tata Steel is to shed hundreds of jobs at its plant in Port Talbot. And the reasons?

Chief executive Karl Koehler said the changes were vital if the company was to remain competitive.

He pointed to the UK's high business rates and "uncompetitive" energy costs as factors in the decision.

So despite all those people who claim that energy costs are nothing to do with the flight of heavy industry from these shores, it seems quite clear that it is in fact an important factor.

It's interesting to consider that most of those who have been flung out of work probably voted for the area's Labour MP Hywel Francis, a proponent of an decarbonisation target during the passage of the recent Energy Bill (and apparently a former communist!). Francis is to stand down at the next election, replaced by the red prince, Stephen Kinnock, another keen advocate of renewables. So to some extent the people of Port Talbot may be the authors of their own misfortunes.

Neither the MP nor his prospective replacement appears to have commented on the news as yet. In such circumstances, keeping one's head down is probably wise.

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Reader Comments (45)

I don't expect Tata will be relocating to Ireland any time soon.

Wind status just a bad as ours no matter how much they tell us otherwise:

Lies, all lies.

Jul 1, 2014 at 2:09 PM | Unregistered CommenterPaul

Can't make Das Autos with sun and wind, need cost effective energy supply, so Germany builds coal fired power stations and mines the black stuff. Simples!

The loss of UK heavy industries is a political decision.

Jul 1, 2014 at 2:11 PM | Registered CommenterGreen Sand

"So despite all those people who claim that energy costs are nothing to do with the flight of heavy industry ....."

It's not 'heavy' industry, but 'energy-intensive' industry which has fled these shores.

Membership of has plummeted.

Jul 1, 2014 at 2:16 PM | Unregistered CommenterJoe Public

Steel, Aluminium, petro chemicals - it's all going or - gone.

Another example [if one were needed], voting Labour = national bankruptcy. Or, being bribed with money we don't have - voting for the green agenda and also the profligacy of left wing kids who've never had a real job but daddy sorted it for me..... [Kinnochio, Straw, Blair, Prescott et al]. Kids - on a spend, spend, spend spree. All it is.......... voting for Miliband the Bolshevik, particularly in areas such as S Wales [ + the north of England, the central lowlands in Scotland] is repeating the same thing over and over and expecting a different outcome = electoral madness.

Jul 1, 2014 at 2:34 PM | Unregistered CommenterAthelstan.

Cheer up. Davies has rescued us again at a net cost of £2 per energy user
Read it and admire this magic play with numbers. The spikes due to lack of wind would cost us £11 but by paying the power companies £1.6 billion/year the lights will not go out and it will only cost us £13. So the net effect is an extra cost of £2 to us. Elegant but unconvincing. Analyst Peter Atherton at Liberum Capital thinks it will be more than £20 to keep the lights on. All Osborne & Cameron would have to do is to offer TATA cheap energy and pop an extra few quids on to our bills. Easy and could possibly be done on the quiet so as not to upset us consumers further. Meantime wind generates 0.14GW or 0.38% of current demand. Maybe Davies needs to up the subsidy another billion to get 95% coverage or we might still get blackouts. What about another ten or so big diesel generator farms?

Jul 1, 2014 at 2:50 PM | Unregistered CommenterJohn Peter

One thing people often miss when calculating the cost to business when energy bills go up is all the knock on costs. Spares, raw materials and even workers become more expensive as they demand more money to cope with their own increasing bills.

Jul 1, 2014 at 2:51 PM | Unregistered CommenterTinyCO2

A politician who robs Peter to pay Paul can always rely on the support of Paul.

This means that the (ex) steel workers in Port Talbot will always vote labour. It's why London is the 6th biggest city in France larger in population than Bordeaux, Nantes or Strasbourg. Any French high earner is fed up with being taxed until the pips squeak by corrupt politicians* and has moved elsewhere.

* French ex-President Sarkozy held over influence claims

Jul 1, 2014 at 2:52 PM | Unregistered CommenterSandyS

Voting Labour = authors of your own misfortune, life-long Labour loyalists. That's what you get from supporting a party that is expert only in the redistribution of poverty, staffed by public school educated Oxbridge PPE graduates who, in truth, despise the working class, and have never spent a second of independent thought on (lack of) global warming or the nature of wealth creation. The Green Labour agenda is just so ironic: de-industrialisation on the march, voted for by those in industry who's prosperity depends on the opposite. And all the while, the BBC recycles green press releases while the scientists bark for more grants to study something that doesn't exist. Whatever happened to common sense?

Jul 1, 2014 at 3:03 PM | Unregistered CommenterLondon Calling

Blue collar workers in the US have figured this out. In the 2010 election, blue collar union members in America's "rust belt" working in private industry voted at barely a 50% rate Democratic. This year with the Keystone XL stall and the EPA's war on coal, there will likely be outright opposition from private sector unions toward the Democratic party candidates. The reason this president needs immigration reform so badly is the Democratic Party needs a new set of voters who are beholding to them.

Jul 1, 2014 at 3:05 PM | Unregistered CommenterSean

"The company spends £60m on electricity in Wales alone, and pays about 40% more for the electricity than competitors in continental Europe."

So in terms of energy, the UK can't even compete with continental Europe ... let alone a North America awash in cheap shale gas.


Jul 1, 2014 at 3:08 PM | Unregistered CommenterBruce

Surely Tata should do some root cause analysis and lay the blame closer to home and name and shame Rajenda Pachauri?

Jul 1, 2014 at 3:20 PM | Unregistered CommenterNick Darlington

This is another one to watch, almost next door:

The reality is that green taxes and regulations making refining in the UK unprofitable, so instead of having the greater security that comes from being able to import crude oil from almost anywhere and refining it ourselves, we must increasingly rely on the few outlets that have surpluses of refined product for sale. For diesel, that means more reliance on Russia, and for jet fuel on refineries of the Middle East.

Jul 1, 2014 at 3:25 PM | Unregistered CommenterIt doesn't add up...

A further nice question is how much do Tata collect in carbon credits this time? Supposedly it was £1bn for Redcar:

Jul 1, 2014 at 3:31 PM | Unregistered CommenterIt doesn't add up...

It would be nice to know what proportion of the costs of energy-intensive industries actually goes on energy. In 'regular' industries, where labour seems to be about 30% of costs, many managements think its worth the hassle of off-shoring to China or somewhere to get that figure down to 20% of costs. So if energy costs are 30% of all costs to an energy intensive industry, surely managements will have a parallel thought process....yes, there are other considerations, but if I'm in a global market and my energy costs are 30% of all costs, and the other blokes are 20% what I suspect is that I am commercially finished unless (a) I do something about that or (b) can seriously claim I am offering a better product so people will pay a premium price.
The other thing of interest in the report above was that Kinnock Junior is being given a parliamentary seat, as young Ms Benn, W Straw etc etc. Don't the People's Party realise how inappropriate for them, of all people, nepotism is? Still I suppose if its allright for a former leader of 'fair shares for all' to be trousering £7m a year or whatever it is, I suppose anything really does go. God knows why anyone votes for them though.

Jul 1, 2014 at 3:54 PM | Unregistered Commenterbill

Tata Group Profile
"Sustainable development cannot be achieved by a single enterprise or even by the entire business community in isolation. It is a pervasive philosophy to which every stakeholder in society and participant in the global economy must willingly subscribe."

What nonsense.

Jul 1, 2014 at 4:10 PM | Unregistered CommenterDon B

One swallow does not a summer make...

Is there a list somewhere in the 'cloud' that can be used to beat these green b*stards with.

They are destroying so many lives

Jul 1, 2014 at 4:19 PM | Unregistered Commenterconfused

Trying to make out that somehow the green nonsense this country's politicians are inflicting on us is somehow a Labour thing is somewhat disengenous, isn't it? How many years of Tory/Lib incompetance would it take to convince folk otherwise?

Jul 1, 2014 at 4:39 PM | Unregistered Commentersteveta_uk

Hywel Francis is in good company down there with Peter (no nukes, we're British) Hain and Paul Flynn. What they all have in common is a monumental lack of knowledge about power generation and distribution but of course that neither stops them sharing their views on the subject nor steering policy in the wrong direction.

Jul 1, 2014 at 4:48 PM | Unregistered CommenterCapell

With respect to the good people of Port Talbot, it probably made little difference whether they voted for the candidate wearing the red rosette, the candidate wearing the blue rosette,the candidate wearing the yellow rosette, or even the candidate wearing the green rosette.

They were all espousing the same bone-headed energy policies.

Jul 1, 2014 at 5:20 PM | Unregistered CommenterAnything is possible

There is no such thing as a former Communist, leopards and spots comes to mind.

Jul 1, 2014 at 5:34 PM | Unregistered CommenterRoger Tolson

One thing people often miss when calculating the cost to business when energy bills go up is all the knock on costs. Spares, raw materials and even workers become more expensive as they demand more money to cope with their own increasing bills.
Jul 1, 2014 at 2:51 PM | Unregistered CommenterTinyCO2

Indeed, and the main reason why I frequent this blog. It doesn't matter whether your politics are left, right, capitalist communist, red, blue, black, white, or sky-blue pink: Increased energy costs will make life tougher and more expensive for everybody.

Central banks can print money, governments can borrow from themselves and their currency, corporations & individuals can buy and float debt, they can beg, steal, borrow, lie, or murder. Scribes can write long into the night describing the merits of a planned political economy, but energy and its costs, per the laws of thermodynamics, really is a zero-sum game or worse. There is no way round it. The piper must always be paid.

Wilfully making the economic-cake smaller helps nobody except Luddite greens who know not what they do.

Money and value is a concept defined and controlled by human beings. Energy is not. Energy is not fungible. Without energy you die. Figuratively and literally.

Jul 1, 2014 at 5:56 PM | Unregistered Commentermichael hart

Bryony Worthington's "wet dream" is turning out to be a national suicide note.

Jul 1, 2014 at 6:33 PM | Unregistered CommenterBitter&Twisted

Calculate how many tons of UK Carbon reduction for each UK Job loss.

Jul 1, 2014 at 8:06 PM | Unregistered Commenterjamspid

michael hart: A mature view of why it makes sense to be on Bishop Hill. Thank you.

Roger Tolson: Not so much. You can't think of a single example of a former communist?

Jul 1, 2014 at 8:39 PM | Registered CommenterRichard Drake

'One reason why we in this country are falling behind the growth of the rest of the world is that in recent years we have had a policy of deliberately driving up the price of energy.

To quote a recent report from the Institute of Directors: “The UK’s energy and climate policies are adding more to industrial electricity prices than comparable programmes in competitor countries, putting UK industry at a disadvantage and making a rebalancing of the economy more difficult”...

A nation can compete on the basis of cheap labour or cheap energy but if it has neither then it is likely to be in trouble. Surely these are not controversial remarks...So, for the sake of pensioners in fuel poverty, for the sake of small businesses struggling to meet their energy bills and for the sake of large businesses all too ready to leave these shores, let us repeat what our ancestors did in the early 18th century and drive down the costs of energy so that we can drive up living standards'.

Viscount (Matt) Ridley- Maiden Speech HoL 14 May 2013.

Jul 1, 2014 at 8:55 PM | Registered CommenterPharos

Really going off topic

Want to see some real lefty environmentalist hypocrisy in action

Lets see these hip Glastonbury Festival Volunteers go Recycling on a rubbish tip in the 3rd world for a few pence per hour for 18 hour everyday.

Why didnt they festival management get a rubbish clearance contractor to hoover up all litter from Glastonbury and cart it off to a recycling plant

The industrialized world we value human being a lot more and let machines sort through our waste.

Jul 1, 2014 at 9:23 PM | Unregistered Commenterjamspid

Before you attack Hywel Francis , a very principled man and outstanding historian. He is the son of Dai Francis the famous Welsh miners leader, so he is hardly anti coal? He admitted tonight on Radio Wales that his view on the Energy Bill was mistaken and had he realised he would have tried to alter it. Unfortunately, highly intelligent men are mere lobby fodder under the Westminster system. His father was a communist, but then so was Ralph Miliband and very much products of a totally different set of economic circumstances.

Jul 1, 2014 at 9:25 PM | Unregistered CommenterTrefjon

Jul 1, 2014 at 9:27 PM | Unregistered Commenterjamspid

Trefjon - drawing the wrong conclusions from a 'set of economic circumstances' is not the mark of an intelligent man. Milliband had no excuse, and neither had anyone else, for believing that Marxism could re-map human nature.

As for Hywel Francis, what sort of intelligence does it take to have missed the howling nonsense that was Miliband Jnr's climate folly?

I can see no reason for letting him, or any other supporter of this wicked legislation, off the hook. They are in Parliament to make correct decisions, not stupid ones.

Jul 1, 2014 at 11:11 PM | Unregistered CommenterUncle Badger

In many industrial and post industrial areas many people live and work in a small area and have very limited experiences.
If people vote, it is for Labour and any redundancies will be blamed on owners and Tories. Most people have no idea of the cost breakdowns of the organisation they work for. Consequently, those in Port Talbot are unlikely to comprehend that increases in energy prices caused the redundancies

Jul 2, 2014 at 12:46 AM | Unregistered CommenterCharlie

Sorry to be OT but I am wondering what everyone thinks about this?

Jul 2, 2014 at 7:53 AM | Unregistered CommenterStonyground

It's even worse than it appears because the power-hungry industries that previously had to shut down are now added into the overall fossil fuel usage figures that attempt to crow that the UK is becoming more energy efficient thanks to the energy policies. It's a self-feeding monster. More jobs lost=> lower carbon footprint=> energy efficiency=> government success story.

Jul 2, 2014 at 8:12 AM | Unregistered CommenterJamesG

The local MP clearly has less clout than you might believe. Eric Joyce of Labour is very much in favour of unconventional gas extraction near Falkirk. It is the local councillors who are against it.

Jul 2, 2014 at 8:16 AM | Unregistered CommenterJamesG

The linked article says "The government introduced measures in the last budget to reduce energy costs for heavy industries but they do not come into force until 2016." so that should help fix things. And we don't know how big effect the business rates have. It's a bit of a non-story really.

Jul 2, 2014 at 9:45 AM | Unregistered CommenterPeter Mott

The local MP clearly has less clout than you might believe. Eric Joyce of Labour is very much in favour of unconventional gas extraction near Falkirk. It is the local councillors who are against it.

A good point JamesG.

And I often ponder on the dynamics of power in this nation.

Up here, in the north of England and throughout the old industrial heartlands of Wales and Scotland too - is it not the case that, in local civic halls and the power base that they create; a totally complaint client state, a bloated public sector stuffed full of minions working under the auspices and guidance of the local alliances created by the Labour party [and Lib dims with able help from the Tories in lots of areas] and with the Unions. Councils in Britain - with rods of "sustainably sourced" rods of iron rule the roost and have done so for a long time, more especially since the local government act of 72-74 when real localism was kicked into the long grass.

In some aspects of local government, particularly ie - social services it very much seems that Westminster writ does not extend to them.

Certainly, with reference to and in the case of the green agenda - local government worships at the altar of UN agenda 21. Witness, the hundreds of thousands of local government jobs reliant on the recycling departments, and all the green mush attendant; global warming officers and agitprop coordinators in the education departments all adds up to "climate change advocacy and maintenance".

Thus, to Hydraulic fracturing and shale gas exploitation even if it makes very good economic sense - but it is anathema to all of these green monkeys. And propagating the very idea of fossil fuel power generation and technology is akin to being daubed as a non person, God forbid...... even a holocaust denying racist.

Labour, has the big metropolitan and unitary councils stitched up - never will there be any common sense strategies but lots of Common Purpose. And still less support of governmental cogent energy policy [ha ha ha ha] coming from your local council. Lastly, even in the leafy shires of England's southern council fiefdoms, "shale gas" is a dirty phrase as are any type of fossil fuels.

In conclusion, one could almost think, that, the councils of Britain do not work for 'the people' nor, did they ever address the concerns of their local electorates. Town and metropolitan councils are almost inviolable, methinks they work in tandem with an altogether higher authority, it's not far away though but it is distant and aloof and non negotiable - and local democracy, certainly doesn't come into it.

Jul 2, 2014 at 10:04 AM | Unregistered CommenterAthelstan.

R4 had a brief summary on this, but needless to say, didn't mention energy costs as being a reason.

Jul 2, 2014 at 10:17 AM | Unregistered CommenterGummerMustGo

Steel manufacture uses large quantities of coking coal - a banned substance under the Carbon Floor Price. You can get a basic insight into production costs here (technical coefficients at least - prices are for the Far East):

Having to import steel will not be such good news longer term for the motor industry.

Jul 2, 2014 at 11:00 AM | Unregistered CommenterIt doesn't add up...

Unfortunately (or perhaps not) local councillors are not in the business of making what might turn out to be unpopular decisions on matters outside their limited experience.
If the government (be it the UK government or the Scottish government) wants shale or oil or coal or more houses or new motorways or any of the other strategic developments that are intended to improve the lot of the nation then it is up to them to make the decision.
Falkirk's councillors are reluctant to support shale development because they have been told by Greenpeace and the Green Party and FoE and the BBC that it is certainly controversial, possibly damaging and most likely unpopular. All of which helps them to conclude that it may also be harmful to their political health. So why stick their necks out especially since energy policy does not apper anywhere in the remit of local government.
If you can persuade them that all these things they have been told are the inane witterings of eco-luddites with a vested interest and that a jobs and business rates bonanza for Falkirk is just round the corner they will change their tune faster than you could possibly believe.

Jul 2, 2014 at 11:30 AM | Registered CommenterMike Jackson

"Think before you vote"

OK, I'm thinking...

Now, who do I vote for if I want fewer windmills and a sensible energy policy?

Hello? Anyone?

Jul 2, 2014 at 12:59 PM | Unregistered CommenterAndrew Duffin

Is this the Stephen Kinnock who became the youngest ever Country Director of the British Council while his father Neil Kinnock was Chairman of the British Council. What a coincidence I wonder what the probability is?

Jul 2, 2014 at 1:53 PM | Unregistered CommenterStacey

From the Ecclesiastical Uncle, an old retired bureaucrat in a field only remotely related to climate with minimal qualifications and only half a mind.

E Uncle to Uncle B

You see no reason not to let a large bunch of politicians off the hook and state they are in Parliament to make correct and not stupid decisions. Nevertheless, I see a large body of reason why one might find it possible to be generous and let the bxxxxxs off the hook while agreeing that they are in parliament to make correct decisions.

Which means that I see a whole host of reasons why the people we put into Parliament are either/both the wrong sort or/and poorly prepared for the work. (As I have argued elsewhere) the poverty of the Parliamentary input is the fault of the system as a whole rather than the individuals who are seduced by it, so I can find reason not to be too hard on them. And, objectivity being the thing these days, I guess most aspiring politicians prepare themselves before diving in to the profession by working for another politician, following the family tradition or getting formal education in the business. So what do they learn? Clearly that public policy will be of little importance to them in the future; instead that keeping one's seat will be the sine qua non. Again, merely a practical recognition of the reality of the political life rather than anything that the individual politician can be held responsible for. So I blame the system for its ills rather than the politicians caught up in it.

Then politicians' decision making processes. As the number of job descriptions recognized by officialdom in the US is approximately equal to the number of MPs in the UK parliament, any system requiring inherently knowledgeable MPs would have to have several times more members than the current house has. It seems unlikely that such a large body could be capable of being an effective organ for making public policy and expecting politicians to be knowledgeable about aspects of public policy is evidently wrong. Instead, as we see in our current House of Commons, we have to recognize that we have to have ignorant politicians. But this situation is not new and we should still expect politicians to work their special magic and come up with correct and not stupid decisions although ignorant of relevant facts. It is what we put them in Parliament to do and you rightly hold them to account when they fail.

Jul 2, 2014 at 2:35 PM | Unregistered CommenterEcclesiastical Uncle

The electorate should certainly think before they vote and our MPs should have thought before they voted for the Climate Change Act. Furthermore, unless they are morons, the MPs should be having second thoughts now.

Jul 2, 2014 at 7:43 PM | Unregistered CommenterRoy

Think before you vote
Most of the political monster that has been created depends upon people's reluctance to think before they vote, fearful as many seem to be of upsetting their fathers and grandfathers. One excellent example is that of Mrs Duffy, famous for Gordon Brown's dismissal of her as a bigot a few years ago; interviewed before the last elections, she extolled UKIP, and disparaged Labour... but, who did she vote for? You guessed - Labour!

Jul 2, 2014 at 10:25 PM | Unregistered CommenterRadical Rodent

Jul 2, 2014 at 7:53 AM | Stonyground

Cherry picking:

Jul 3, 2014 at 1:13 AM | Unregistered CommenterBilly Liar

Must agree with the Uncle here. It is unrealistic to expect politicians to be experts across the board.

What we want is for them to exercise that rarely mentioned but critical quality called "judgement." It is just like what we all have to do in our daily lives - we are not experts in the workings of the internal combustion engine, or plumbing, but we have to make decisions about them which cost money.

Jul 3, 2014 at 5:20 PM | Registered Commenterjohanna

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