In times of crisis, excess profits by energy companies are a moral failure

The late American business mogul Lee Iacocca believed that all business operations can be boiled down to three words: people, products and profits. Even the die-hard auto tycoon has realized that it all starts and comes back with people.

Curiously, this view was shared by another famously tough titan of the automotive world – Henry Ford also insisted that businesses must be run for profit. However, he made an important difference.

“If someone tries to run a company purely for profit, then the company must die too, because it no longer has a right to exist,” he said.

Such thoughts take on new relevance as people ponder crippling energy costs and ESB announces its half-year results show a profit – after tax and exceptional items – of €390m. This is three times the profit of 128 million euros that was generated in the same period last year.

European Commission President Ursula von der Leyen said in Brussels this week: “In these times it is wrong to achieve extraordinary record profits that benefit from the war and at the expense of consumers.”

She pointed out that the bloc faces not only a security threat from Russia’s invasion of Ukraine, but a broader war.

“It’s a war on our energy. It’s a war on our economy. It’s a war on our values. It’s a war for our future,” she said, adding that the bloc’s electricity market “is no longer fit for purpose.”

The urgency to decouple gas prices from electricity costs could not be greater.

Tánaiste Leo Varadkar agreed, saying it was “right and proper” for the government to take back some of the big profits energy companies are making.

But it is also “right and proper” that any measures that can reduce bills must be vigorously pursued.

Taoiseach Micheál Martin confirmed that the Government is the shareholder on behalf of the Irish people in the ESB.

“I think the government can look forward to a much higher dividend than it would have had before [energy] crisis,” he said.

Brussels expects each EU member state to calculate its own numbers when it comes to what windfall tax to charge energy suppliers. As EU Financial Stability Commissioner Mairéad McGuinness said: “The idea is that when consumers are truly suffering from astronomical energy bills and the companies producing renewable energy are making significant and unexpected profits, it is time to redistribute …

They say poverty is the only burden, the heavier the more there is to carry. The needy should have to carry as little as possible. In times of crisis, excess profits by energy companies are a moral failure

Fry Electronics Team

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