Environmental Engineering Reference
In-Depth Information
Energy: who
controls it?
Too important to be left to the
market
Energy is special. It's what keeps us and our way of life going.
Because it is an essential commodity, governments usually take
some responsibility for maintaining it. Because it is an essential
commodity, governments generally like to tax it and occasionally to
subsidize it.
In recent years there has been a widespread move to treat energy as an
ordinary commodity like any other, so as to introduce more competi-
tion in the producing and trading of it. It is, after all, a commodity in the
sense of being standardized, interchangeable collections of molecules and
electrons.
The changing attitude of governments and businesses towards energy
has a historical precedent: salt. While salt was still prized as the sole
preservative of food, some governments as in ancient China or in British
India decreed its production to be a state monopoly or imposed a special
tax on it. But today, salt is a banal commodity, produced and traded
everywhere.
Lowering the barriers to cross-border energy investment and trade
meant national energy companies surrendering their national monopolies
in their national markets. This barrier-lowering process - going under the
name of liberalization or deregulation and often involving privatization -
was also promoted to developing countries, in the name of efficiency, by
international institutions such as the World Bank.
