Public utility structure energy companies- Jean Paul Escoffer

October 2002 - March 2003

VOL. 3-4 NO.4-5

PUBLIC UTILITY- STRUCTURE ENERGY COMPANIES By Jean Paul Escoffer

If originally the development of the energy companies came true with the private capital, the perspectives of development required a strong demand of financial investments, which led states to put under their control the exploitation of these companies. Either they were established state control, or states handed the exploitation to bodies controlled, mainly by them, as for example the nationalisations.

It is only in the 1980s when, in front of the new crisis of the capitalism, the privatization of the energy sector accelerated.

The ideological battle concerned the fact that it was necessary to break “monopolies” to impose the competition which would have virtue to make lower the prices in favour of the “final customer”.

The balance of the “nationalised” said companies shows that these partially met the needs and the expectations. It is necessary to indicate that these companies widely favoured the big branch of industry, which obtained very good prices to the detriment of the great majority of the users, which bore the difference notably for the gas and the electricity.

Things being what they are, in 50 years, for example, the nationalised company EDF (Electricity of France) multiplied by 20 its production, which is passed from 20 TWh to 400 TWh.

One of the questions today which remains determining, and which has to weigh in the future evolutions of the sector, it is the property of natural resources.

These natural resources are unequally distributed on the planet. All these resources, coal, gas, petroleum, uranium, situated on the territory of a country belong as a consequence to each of the nations which possess them.

The energy question became a major stake favouring tensions, conflicts and wars. The current event is there to remind it to us.

Today, the poor countries, certain number of which possesses these natural resources in quantity, are forced by the IMF and the World Bank to privatize. Multinationals seized these deposits and run them and, by integrating the international financiarisation, make that the profits increase but that, what has to be return to states, is ceaselessly reduced and weakens at the same moment the capacities of economic and social development of these same states.

The structures of the energy companies have to take into account several essential factors:

· the economic dimension:

The extraction of the coal, the petroleum, the gas, appealed to technologies and techniques and important know-how. The researches in the field of the sciences, techniques should allow evolutions notably in the field of the extraction of these resources. The question of the profitability of these companies is to be taken into account. The question of the return on capital invested is a thing, the search for the maximum profit – as it is the case at present – is the other one.

The profit race is made to the detriment of the states which possesses these resources, against the employment, the payment for the employees, opening a permanent risk, that of the non-safety, and the degradation of the environment.

· The social dimension:

The exploitation of the resources of countries, and by means of the just payment, has to contribute to the economic development and to the social development of each of these countries, by favouring the access to the energy, the water and the electricity, in the health, in the education.

· The environmental dimension:

Any exploitation of natural resources has to ask the question of the conservation of this one. That is why must be also integrated the question of the new technologies.

· The democratic dimension

The requirement of more citizenship will assert itself with more and more force in all the countries of the world. The future of natural resources, their exploitation, their end, have to depend on clear political choices which cannot be only delegated to the institutions of every country, but we have to be the object of wide democratic debates implying all the levels of the organisation of the society: local, local, regional and national.

The attempt to remove the idea and the notion of public utility failed in Europe. After more than 10 years of mobilisaion and fight, the European Union is forced to reintroduce this essential dimension that is the public utility.

In the case of the Electricity, that the company is established state control, nationalised or privatised, she has to integrate the question of the public utility.

Why a public utility?

The electricity, to speak only about it, can be on no account dominated by the capitalist profit. With more than two billion individuals who have no access to the electricity, it is indeed in term of universal right that the question of the right for the energy must be put and who impactes at the same moment a contents of public utility.

It is up to the IEMO to favour the debate around the principles of what recovers the notion of public utility. It should allow, towards the cultures, experiences, exchanges between unions and associations, to discuss in every country, to define and to propose the inviolable marks to insure the public utility to every individual, answering the individual and collective interest.

Far from being exhaustive, some marks for a public utility:

1. Access to the electricity for all

2. The electricity is a product, which must not be integrated into the notion of capitalist market.

3. Equity of treatment at the level of the accessibility, of the price, the returned services (interventions, repair)

4. The public utility has to insure the continuance 24H/24H of the supply of electricity

5. Co-operations have to develop with the local and regional governments, the public utilities of health, etc.

6. Authorities of information, exchange and decisions must be organized associating the authorities of the state, one or several concessionary, the local and regional governments, consumers’ associations and humanitarian (flat etc.), the unions of the company and territorial

7. Define an energy policy corresponding on one hand to the national needs and to the choices of the means, notably the productions and the transport to be implemented, taking into account the resources of the country, the technologies and the diversification of the means.

8. The public financing has to allow to insure the development of the networks of nearness.

9. The electricity must be recognised as a world public good

So each of the quoted marks-not restrictive – asks for some of them for more consequent developments to clarify the nature and the mission of the public utility, taking into account needs, expectations of the populations in a perspective of economic, industrial, social development and societal.

Besides, the political powers and the capitalist companies are forced to take into account the ascent of the requirements expressed by the populations. We are indeed in a development of balance of power.

A first element: the ethics of companies

Many companies and multinationals in the energy sector display campaigns of communication to inform about their strategies.

Generally, they evoke three marks:

1) The economic performances, in other words the necessity of making profits. However, it is necessary to us to notice that the majority part of the profits is mainly retroceded to the shareholders in the form of dividends and of stock options for Chairmen and Managing Directors.

2) The social dimension

3) The environmental dimension

One of the reports that we can make, it is that the privatisation in the power sector of the electricity, and for example in Africa, had no important consequences to allow the acess to a bigger number among the African populations.

If we can only agree for companies which can contribute to the development of societies by their economic, social and environmental investments, today these same companies and multinationals auto-appropriate themselves an ethical label.

For a real credibility, it is necessary to create an independent body, which can award this label on the basis of reliable and controllable elements. We also advance the idea of public-private partnershipspraised by the Transnationals and the World Bank. Even there, it shows that the idea of public utility was not annihilated nor buried. It is up to us at first to resist to the privatisation and to lead the battle for the modernisation of the national public utilities and their decentralisation, there where they exist, and by going to the creation of new public utilities, by favouring partnerships with the other public utilities and it, in the sector of the energy., etc...

If public-private partnerships are not to be excluded, they can be made on no account on the back of the public and against the interests of the populations.

Here are some elements which have to lead us to a first debate during our Congress, but especially to pursue it with all the union members and the employees of the sectors of the energy in every country, taking support on the balance of the forces and on the development, on the acquired trade-union experience, on the propositions of contents so much energy policy as the conception of the public utility which has to appear and the initiatives of fights both at the local, national and regional level.

Would not we have to create a group of reflection and animation, appointed by our Congress, leaving elements of the debate to impulse an activity on the initiative of the national syndicates ? And, from their conception of the demands and the fights, could not we also elaborate a text of the IEMO allowing each to be situated on invoilable marks and to give a content to gain an actual application of the public utility?

It is a new trade-union method which implies to work each from the demands and own industrial actions, to work all the possible convergence between employees of the industries of the energy, consumers’ associations, the social associations, favouring the emergence of a project of public utility and to create the balance of the forces imposing the opening of negotiations meeting the needs of populations and for the improvement of the life of the people.


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