Should basic services such as water, gas, and electricity utilities be governed by the free market? Or should they be considered a “public good”, and nationalised to keep prices down? It’s an old leftwing policy that fell out of fashion in the 1980s, but with energy prices skyrocketing and vulnerable households facing energy poverty, could it be time to resurrect it once more?

Proponents of nationalisation argue that private companies hike up prices and focus on profit over people. Utilities often create natural monopolies, and consumers cannot choose to stop consuming water, gas, or electricity – therefore, the logic of the free market starts to break down (or so goes the argument). Critics respond by pointing out that publicly-owned alternatives were inefficient and plagued by political interference from governments who only thought about winning the next election.

What do ours readers think? We had comments on this topic from Любомир (Liubov), Jonathan, Rosy and Nando. To get a response, we put them to Manuela Ripa, a German MEP who sits with the Group of the Greens/European Free Alliance and a member of the European Parliament’s Committee on Industry, Research and Energy.

For another perspective, we also put Любомир (Liubov)‘s comment to Magdalena Maj, Leader of the Energy and Climate Team at the Polish Economic Institute. Our reader had suggested that “All infrastructure utilities should be publicly owned and regulated on a national, and possibly EU level.”

How would Magdalena Maj respond?

It is very difficult topic that Liubok raises in his statement. Do I agree with this or not? I guess I wouldn’t say yes or no definitely. I may say what the experts currently are saying also from other European countries, where this infrastructure is not owned by the state. There are voices that regret that this infrastructure was privatized. But we must firstly hope that this difficult situation in Ukraine, this Russian invasion, will end soon and that the whole energy crisis which started after the pandemic and the pandemic itself, hopefully, will end soon.

So, in a different reality, in a normal reality, I would say that it is better to have privatized infrastructure of production of energy and transmission systems, so the grids and the pipes. because there is a market and competition and there is improvement etc. now in such a crisis it’s easy to forget about it and we may see that the easier and better solution would be to have this critical infrastructure owned by the state, because then it could be easily regulated. But in normal times there are huge disadvantages with that.

From the Polish experience, I may say that after the nineties, Poland made a huge effort for the liberalisation of energy infrastructure. And without this, we would be even more stuck with fossil fuels and old non-efficient infrastructure than we are now. So, I understand the way of thinking, but over a long term period I think it’s better to have private infrastructure.

Should water, gas, and electricity utilities be nationalised? Or is the free market the most efficient way to deliver basic services at an affordable price? Let us know your thoughts and comments in the form below and we’ll take them to policymakers for their reactions!

IMAGE CREDITS: CC / Flickr – Peter Asquith
Funded by the European Union. Views and opinions expressed are however those of the author(s) only and do not necessarily reflect those of the European Union or the European Commission. Neither the European Union nor the granting authority can be held responsible for them.



5 comments Post a commentcomment

What do YOU think?

  1. avatar
    EU-Reform Proactive

    My 2016 opinion remains:

    Our sovereign national governments should be solely responsible and hold resource ownership, rights & obligations (like its mineral & human rights etc.). As such- be free to decide, design, develop, produce, distribute, contract & conditionally share with any reputable private sector partner (PPP) – or relatable countries- to obtain the a.m. basic commodities & services at cost- for the sole benefit of its citizens- ethically, sustainably- without State, political party or corporate corruptions.
    .
    Was raising this issue in 2016 too long ago? What was its conclusion? To analyse & summarize past results could/would be quicker than starting & repeating our previous comments afresh. (Using DE analytics/ AI?) What has changed in the past ~6 years?

    Was it technological advancements? Change in EU ideology, or leadership? National government & voter’s sentiments?

    Or- geopolitical shifts & rifts? Running out of themes?

    Or- revelations by investigative journalists- so far- without any serious consequences? Why cast a political blind eye on the many tax evasions & their enablers & flourishing tax havens?

    https://www.europarl.europa.eu/news/en/headlines/economy/20150529STO61068/tax-avoidance-vs-tax-evasion-fiscal-vocabulary-made-easy

    Q: Who & when will “someone“ show teeth to prosecute, confiscate (nationalise) and/or seriously sanction EU tax havens- like it’s done with Russia?
    Why hesitate to implement EU Agenda 2019-2024- “Big on Big”?

    https://www.investopedia.com/articles/wealth-management/121515/top-10-european-tax-havens.asp

  2. avatar
    Lili

    The prices on everything always shell be controlled and have reasons behind the rises.

  3. avatar
    Petar

    Nationalising???? The entire (ongoing) pandemic was left to the free market and it turned JUUUUUUUUSSSSST FIIIIIINE

  4. avatar
    Petre

    Shipwrecks in any port have been eliminated in ships so that the molluscs do not cross … If you suck the shit out of your nails, is it better?

  5. avatar
    JT HK

    Energy hinges to survival of people and enterprises, it should be the duty and responsibility of government. Overloaded government and privatization are invention of neo-liberalism, which has led to growing disparity of wealth. Privatization means price racing to the bottom at the sacrifice of quality and ethic. More importantly, it has damage the governing efficiency and capacity of the government executive department. As a consequence, government becomes paralyzed in front of natural catastrophic situations including the current Covid-2019 pandemic.

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