Should we be doffing our caps with apologies to Arthur Scargill? The miners' union warhorse has been warning for decades that Britain needs a joined-up energy policy and that we are heading for an almighty energy crisis, one which threatens to be as damaging as those in the 1970s.
Scargill may have been a dinosaur when it came to restructuring his industry but he was a trailblazer in recognising the importance of coal to the economy. By all accounts, the lights could be switched off in 2015 if Britain does not get more electricity on stream to make up for the short-fall as elderly plants are closed before new nuclear is ready.
That's why the Government's decision, due early next year, on whether to build the first new coal-fired power station for 34 years is so vital. If E.ON doesn't get the green light to re-build Kingsnorth as a coal-fired station, the German operator could use gas instead – more expensive and less secure as most of our gas will, by 2010, be imported from Russia, Qatar and Libya.
Kingsnorth has become a political hot potato, dividing the Government and opposition parties alike, because the greens don't like coal. It's a tricky one for Ed Miliband, the newish Energy Secretary, as it will shape the future of Britain's energy policy for decades, if not generations to come. If Miliband gives the go-ahead, there will be uproar from hardcore greens who want to stop coal-powered electricity because of its carbon footprint.
But it looks as though Miliband will have to swallow his green card on this one. Gordon Brown believes that longer-term energy security and fuel costs are more important. Six million people now live in fuel poverty and the energy companies have been told to cut bills. As Brown knows, electricity made from coal, even cleaned-up coal, is now much cheaper than that made from gas.
Kingsnorth could be turned into a landmark. E.ON should be allowed to go ahead but only if it uses all the latest technologies to scrub the coal. Using both pre- and after-burn techniques, the clean lobbyists claim, coal becomes more efficient and less polluting than any other fossil fuel. Australia's White Energy is one of a handful of pioneers of a de-moisturising process which dries out the coal, increasing its thermal efficiency and lowering the sulphur and carbon footprint. After-burn is trickier, as carbon capture and storage involves taking the nasty gases away by pumping them into disused wells under the sea; experts are still working on better solutions and E.ON has agreed to retro-fit the plant.
Britain also has a lot of coal – enough, according to Scargill, for another 1,000 years. Fourteen firms have applied to develop 58 new opencast mines, producing 60 million tons a year, enough to match the UK's energy consumption. This is the biggest attempt to re-launch the British mining industry for 30 years. UK Coal wants to spend £200m reopening the Harworth deep mine in Nottinghamshire while reserves have been discovered in Northumberland which could become Europe's biggest opencast mine. What could be better: clean, cheap energy and more jobs.
Coal fuels 40 per cent of the world's electricity and in countries such as China it's going to grow to 75 per cent in the next few years. If Britain is brave enough to approve Kingsnorth, we can pioneer technologies for reducing carbon output and help solve one of today's great challenges.
Memo to the thundering herd: work part-time or be trampled into the dust
I hear the bulls are raging at Merrill Lynch over the way in which the bears at Bank of America are trampling all over its investment banking business. Bankers at Merrill are furious that BoA's axe is falling hardest on capital markets after its cull of 35,000 jobs at the combined group.
Precisely where the cuts will come are not known yet, but Merrill's London office fears that a big chunk of its 6,000 jobs will go. One Merrill director told me that boss John Thain is fighting a losing battle to keep his bankers on Wall Street and in the City. But Thain shouldn't be surprised. BoA's Ken Lewis was always keen to get his hands on Merrill because of its fantastic retail broking brand in the US. Having avoided big-scale investment banking for most of his highly successful career, Lewis is unlikely to fall for it now as the business is being massacred.
And what a massacre. The latest figures, for the third quarter, show revenues at the world's 12 largest investment banking operations fell by 90 per cent to just under $2bn (£1.3bn).
There is more pain to come too. Total write-downs and credit losses announced by banks have already exceeded $700bn, but the total to be written off by financial service firms will be around $1.4 trillion. Credit Suisse and Goldman Sachs didn't even break even in the third quarter, while BoA's profits were wiped out. No wonder Lewis is taking the axe to Merrill's herd.
On Tuesday, Thain's alma mater, Goldman, will say it has lost money for the first time since it became a listed company. On Wednesday, Morgan Stanley is also forecast to report a loss. Together they employ 10,000 in London. Maybe they should take a leaf from groups like Corus and suggest staff take pay cuts or work flexitime to keep their jobs. There are alternatives to hiring and firing.
Collateral damage: Vague rules must be tightened up
How many more directors have pledged shares in their companies as collateral? That's the intriguing question raised by David Ross's admission last week that he had put up nearly £216.4m worth of shares in Carphone Warehouse, National Express, Big Yellow and Cosalt as security against his personal loans to fund his investment in shopping centres and other property ventures.
Two others have already stepped forward – Ian Farmer at Lonmin and Eli Reifman, president of Emblaze – but there will be more as this recession shakes out. Quite apart from Ross's personal foolishness, this incident shows that the rules surrounding disclosure need to be strengthened, as they are open to interpretation. The main listing requirement is clear: a director must inform his or her chairman that shares have been pledged, and this request must then be granted in writing. But it's the market-abuse rules on disclosing the use of shares as security to other shareholders which are ambiguous and which the Financial Services Authority needs to move quickly to tighten up.Reuse content