Power and Public Ownership in Hull, the UK’s “Energy City”

Hull’s recent history raises a number of important issues around the prospect of a large-scale renewable energy transition, and its potential role in addressing deep regional economic inequalities within nations.

Image: © John Bannon ( CC BY-SA 3.0 )

Image: © John Bannon (CC BY-SA 3.0)

The wide expanse of the Humber Estuary is central to the United Kingdom’s ever-increasing energy demands. Two vast oil refineries on the south bank of the estuary—owned by American corporations Total and Phillips 66—refine a third of the UK’s fuel. A third of the country’s coal imports arrive via the Humber, as does a fifth of its natural gas supply. In the last decade, the estuary has also become an essential component in UK offshore wind energy generation, a welcome addition to a landscape long dominated by the infrastructure of fossil energy production. In November 2014, Siemens announced that it had chosen the city of Hull, on the estuary’s north bank, as the location for a new turbine factory. Positioned on England’s eastern coast, Hull provides an ideal site for the manufacture of turbines for the numerous offshore arrays currently being assembled in the North Sea. These arrays supply a British electricity grid still chiefly dependent on coal, gas and nuclear energy.

Hull’s recent history raises a number of important issues around the prospect of a large-scale renewable energy transition, and its potential role in addressing deep regional economic inequalities within nations. As the neoliberal orthodoxies of austerity, financial speculation and privatization come under increasing pressure from the left across the world, the return to modes of public, democratic ownership of energy provision represents a particularly important terrain of political struggle. Hull provides a good illustration of how a politics of public affluence and democratic participation provides an alternative to a world in which we, and our environment, are increasingly beholden to the profit-making motive of multinational corporations.

The provision of the North Sea wind arrays is only the latest chapter in Hull’s long manufacturing and seafaring history, but it is a significant one, given the deindustrialization of the city in the last quarter of the twentieth century. Like many cities in the North, Hull’s recent history is marked by neglect and poverty. Most of the city’s docks closed by the early 1980s as its deep-sea trawler fleet declined due to the “Cod Wars” with Iceland, European fishing quotas, and rising oil prices. No comparable employment base has emerged: unemployment levels in Hull remain among the highest in the UK, and over a third of children in the city live in poverty.

The Labour-led city council has sought to build a different future for the city’s residents. In summer 2013, it launched the ambitious “Hull City Plan” to create 7,500 jobs for local residents and reinvigorate the city’s image. Its central component was the establishment of Hull as the UK’s “Energy City,” the home of renewable energy manufacturing. The Plan would see the city’s large, empty docks put to use once more, with Hull College and the University of Hull playing a central role in establishing the city as a hub of renewables research, education and training.

The launch of the Plan was followed in November 2013 by the announcement that Hull would be the UK’s 2017 “City of Culture.” Awarded every four years, the City of Culture designation aims to attract tourism and investment, direct urban regeneration and provide opportunities for engagement in the arts for the local community. Hull was, in the organizers’ words, a city “coming out of the shadows,” with the City of Culture award “a unique chance to shed its image as a declining and deprived port city and to build a new profile as a vibrant cultural city.” Hull City Council invested £100 million of its capital reserves in the regeneration of large parts of the city centre as part of the City of Culture preparations.

Given the concurrence of the City of Culture and Siemens announcements, it was fitting that renewable energy was at the forefront of the opening weeks of Hull 2017. Artist Nayan Kulkarni borrowed a turbine rotor blade from the new Siemens factory to create his installation Blade. In the early hours of the eighth of January, 2017, the 75-metre blade was carefully manoeuvred through the city’s streets. Installed on two purpose-built plinths, Blade arched gracefully across Hull’s central Queen Victoria Square.

For many, Blade captured a sense of the guarded optimism that has flowed through Hull in recent years, as a result of the opening of the Siemens factory and the City of Culture award. The factory has brought around 1,000 jobs to the city, an unthinkable figure even a decade ago. But Kulkarni’s installation also points to the council’s reliance on Siemens in realising its plan and, by extension, the degree to which states and municipalities everywhere have been denuded of power by decades of privatisation. Speaking shortly after Blade was installed in the city centre, Kulkarni alluded to the reasons why the Humber was chosen as the location for the new factory, besides its geographical advantages: “I knew how many negotiations and deals had gone into getting Siemens to open their plant in the city,” Kulkarni said, “and the impact it would have on the area, so it felt almost self-evident to ask them to donate a blade.” Hull’s bid to be the home of the new Siemens factory won out over cities in the Netherlands and Denmark largely because in 2012 much of the Humber was designated as an Enterprise Zone, where corporations benefit from reduced taxes, business rates and regulations.

Under the austerity politics imposed nationwide by Conservative and coalition governments since 2010, the counterpart to the jobs created at the Siemens factory has been the stripping of public services, increasing casualization of jobs and in-work poverty. The legacy of Hull’s year as City of Culture will be inextricable from the decimation of municipal funding by central government cuts. Hull City Council has lost more than £120 million from its budget since 2010. Further cuts are due to take place by 2020, including £10 million over the course of this year. The visibility of the city’s recent transformation masks how drastic cuts to education, social provision, jobseekers allowance, and disability benefits for its poorest residents have entrenched and deepened inequality. (This tension is examined in vivid detail in Sean McAllister’s excellent documentary A Northern Soul, released earlier this year. The film follows Steve Arnott, a warehouse worker, community activist, and enterprising hip-hop artist, for the duration of Hull’s year as City of Culture.)

The effects of global warming will soon exacerbate existing inequalities in this low-lying, flood-prone city. Over £75 million has been earmarked for improving flood defences in Hull and along the Humber. But in an age of reduced municipal funding, these preventative measures are a partial solution at best. Bigger walls will keep rising seas out for a while, but the question of who pays for large-scale adaptation, particularly the much-needed improvements to housing stock in the poorest areas of the city, is deferred. For many residents, property-level protection (air bricks, anti-flood doors, non-return valves) and energy-efficiency measures are prohibitively expensive.

Hull’s tidal barrier. The barrier was illuminated with text as part of Michael Pinsky’s  City Speaks  installation, which ran between February and December 2017. Image: © Michael Pinsky. Reproduced with permission of the photographer.

Hull’s tidal barrier. The barrier was illuminated with text as part of Michael Pinsky’s City Speaks installation, which ran between February and December 2017. Image: © Michael Pinsky. Reproduced with permission of the photographer.

As things stand, the council’s plans for the coming decade hinge on Siemens expanding its operations in Hull. But the “Energy City” has failed to materialize, largely due to supply-chain companies not following the German corporation to the banks of the Humber. Many of the components for the Siemens turbines are still shipped in from elsewhere and then assembled.

The result of the EU referendum of summer 2016 is one clear factor in this failure. Siemens had initially planned to expand its factory in order to export turbines to other countries in Europe, but these plans were quickly put on hold in the wake of what Tom Hazeldine called the “revolt of the rustbelt.” 67 percent of the electorate in Hull voted to leave the European Union, a pattern repeated across many of the former industrial heartlands of the North, the Midlands and South Wales; all had suffered long periods of unemployment, lack of opportunity and declining living standards, intensified since 2010 by austerity. As Hazeldine emphasizes, this wasn’t the only vector in the Leave vote—age was perhaps the major variable nationwide, and many affluent and conservative areas of the of the South East and South West voted Leave even more decisively—but it was a significant one. While “the rhetoric of Leave was anti-immigrant,” Hazeldine concludes, “the anger that powered it to victory came from decline.”

To further understand the city council’s reliance on Siemens, and to begin to draw the outlines of a different future, we must also look back to the privatisation of public utilities and services instigated by the Conservatives under Margaret Thatcher and continued by Tony Blair’s New Labour after 1997. Few countries have implemented the neoliberal orthodoxy of privatization and outsourcing with as much fervour as the UK: in the 1980s, its communications network, gas, water and airports were sold off, followed by the railways in the ’90s and, since then, elements of the National Health Service and the Post Office. The UK’s energy board, regional suppliers and infrastructure—its grids, cables and transformers, as well as its existing power stations—were divided up and sold to the highest bidders in the 1990s. American companies initially bought up many of the newly privatized companies, but after a period of tumult, large European corporations stepped in. EDF, majority-owned by the French state, began buying parts of the UK electricity network in 1998. It now owns all the UK’s nuclear reactors and many of its coal and gas-powered stations. British electricity was in effect renationalized—but by the government of France.

Inevitably, renewable energy provision in the UK has followed a similar path towards private ownership and the prioritization of short-term profit. A range of large corporations are involved in the wind power arrays in the North Sea, including Orsted and Statoil, the majority state-owned energy companies of Denmark and Norway respectively. The UK’s renewable energy network, particularly its offshore wind provision, is growing rapidly. Yet it remains a complex, opaque and undemocratic mix of state-sized corporations like Siemens and majority state-owned energy companies like Orsted and Statoil that are often unwilling to invest without profitability guarantees, tax breaks or other effective public subsidies.

The failure of Hull’s “Energy City” plan provides further evidence that leaving both large-scale renewable energy transition and regional economic revival to corporations will not suffice. Siemens supplied a good example of the real logic of a putative “green capitalism” (and of the “Lauderdale Paradox”) when it scrapped its solar energy division in 2012, citing its declining profitability as technological and manufacturing developments made solar energy production cheaper. In a similar vein, the corporation’s plans in Hull contain a caveat that has not been widely publicized: the new factory is intended to operate only for around thirty years, at which point, according to Siemen’s original plans, it will be dismantled and the land will “revert to general port use.”

What will a progressive, long-term energy plan for the UK look like? And how might it dovetail with the “remunicipalization” schemes that are developing around the world, in order to return utilities and services like water and electricity to public control after decades of neoliberal privatization? These are questions that have grown in significance since the general election of June 2017 and the relative success of the Labour Party under Jeremy Corbyn’s leadership. The election punctuated Hull’s year as City of Culture; like most cities in the North, Hull is a historic Labour stronghold. If Brexit provided the means for many in the UK’s former industrial heartlands to voice their anger after decades of decline, then the left’s task, one Labour is seeking to address, is to once more articulate a politics of public affluence over private wealth.

Central to Labour’s success in 2017 was its manifesto, which included plans for national and regional investment banks to fund large-scale reinvestment in the productive capacity of the economy, as well as a three-stage plan to bring energy provision back into public ownership. Labour’s Alternative Models of Ownership report, released just a few days after the 2017 general election, laid out an ambitious vision of national, municipal, cooperative and worker control and ownership of utilities and services, with an emphasis on democratic participation at all levels of decision-making. Polls have repeatedly shown that the renationalisation of rail, water and energy networks, as well as the Post Office, are popular policies with the electorate after decades of declining services and shameless price gouging. This popularity offers a window of opportunity to frame the suppression of fossil fuels and a renewables transition not as an elitist environmentalist issue, but as a fundamental element in the construction of a more just, democratic and regionally-balanced economy for all.

Labour policy over the coming years will need to rebuild political consensus around the role of the state in leading innovation and planning for a sustainable environmental future. In his speech at this year’s Labour Party conference in Liverpool, shadow chancellor John McDonnell outlined plans for an “inclusive ownership fund” at every company with 250 employees or more. An IOF will transfer up to 10% of ownership to workers and provide a dividend of up to £500 per employee, with additional dividends going to a national fund to pay for public services and welfare. Providing workers and local communities with the right to take over the running of a plant or business if plans are filed to sell or close it offers another policy that could be implemented immediately on Labour assuming power. In Hull, the Vivergo biofuel plant closed at the end of September, with the loss of 150 jobs and a significant impact on a further 3,000. The plant converted wheat from nearby farms into biofuel for vehicles. It was operational for only five years and was shuttered due to the current government’s ongoing indecision on renewable energy policy, despite the clear transitional role is has to play in the move away from fossil fuels. A “community/worker right to buy” scheme, in combination with a clear renewables strategy, could see the plant reopen.

More radical proposals will need to follow. Like Alexandria Ocasio-Cortez in the US, the economist and Labour advisor Ann Pettifor recently called for the mobilization of a “Carbon Army” and a “green new deal” for the UK economy, in order to address both the impending climate crisis and the deep regional inequalities in the British economy. Jeremy Corbyn’s speech at the Labour Party conference formalized these proposals by laying out plans for a massive expansion of renewable energy provision, in order to create around 400,000 jobs and reduce the UK’s carbon emissions to zero by 2050. This “green jobs revolution” would not only see the massive expansion of wind turbine manufacturing in places like Hull, but also the installation of solar panels and improvements in energy efficiency on a home-by-home basis, such that, in Pettifor’s words, “every one of Britain’s 27 million households becomes a power station.”

In Hull, the Goodwin Trust—a coalition of tenants’ associations established on the city’s Thornton Estate in 1994—has already begun tracing what this future might look like. The Trust recently built a block of “eco-social housing,” replete with various energy-saving measures and rooftop solar panels. These units provide a model for how much of the rest of the city might be refitted, as well as an example of how a future of renewed public ownership and investment could build on existing forms of community-led innovation. On a national scale, a revived Ministry of Technology, working in collaboration with universities and colleges, could direct and coordinate research, development and training, particularly job transition programmes for those currently working in fossil fuel industries. (Will Stronge outlines what a new Ministry of Technology might look like in further detail in his essay “Work and Free Time: A New Social Settlement” in Open Democracy’s excellent New Thinking for the British Economy.)

Labour’s plans should still be the subject of critique, of course. Jeremy Corbyn’s vague mention of “low carbon sources” in his Liverpool speech probably signals a continuing role for nuclear energy in the move to zero emissions by 2050—as Richard Seymour argues in detail, this would be an economic, infrastructural and environmental mistake. Scaling up new models of ownership to effect a wholesale transformation of the economy will be a significant challenge, to say the least, and the efficacy and fairness of the kind of “green jobs guarantee” outlined by Pettifor has also come into question, as Johnathan Guy has examined in detail. In my view, a steadily increasing Universal Basic Income and Universal Basic Services are the necessary counterparts to this project in the long run. So too is large-scale reinvestment in high-quality and energy-efficient transportation (something particularly long-overdue in the North, where rail electrification plans have repeatedly been scrapped or postponed).

The robust defence and extension of welfare provides the necessary counterpart to policies around energy ownership and transition. In the face of automation, the effects on economic activity of a rapidly changing climate and an aging population, the left everywhere must frame UBI and UBS as a supplement to the welfare state, rather than a replacement for it. Jeff Bezos’s recent comments on turning schoolchildren into consumers of education services provide a good example of the right’s case for a version of UBI: the further privatisation of public services in the name of consumerist “free choice.” The left must reclaim the discourse of “freedom” from the ideologues of neoliberalism, rearticulating it as the right to live a dignified and enjoyable life, where dependence on others is not the foundation for demonization and stigmatization, but the basis for collective prosperity and happiness.

As Theresa May lurches from crisis to crisis amid the continuing uncertainty surrounding Brexit, another general election seems likely to arrive sooner rather than later. Should it secure a majority, the first task of a Corbyn-led Labour government will be to ameliorate the lives of the poorest in society after nearly a decade of brutal austerity politics. In particular, Labour must address the disproportionate impact of austerity on women (particularly those on low incomes), people of colour and disabled people. Its long-term task will be to build a broader political project around economic and climate justice, widening and strengthening democratic participation and devolving power from the affluent South East to the regions through a rejuvenated municipal socialism. On the banks of the Humber, gateway to the North Sea, Hull will have a particular role to play in regional and national energy policy; but in this vision, it will be one “Energy City” among many.

Tom White is a contributing editor of the Glasgow Review of Books and a research fellow at the University of Oxford. He has interests in the environmental humanities, climate politics, and the history of media. He tweets @___TomWhite___.

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