I was quite nonplussed to see the Chancellor of the Exchequer wanting "reassurance that energy companies are not using the short-term wholesale price fluctuations as an excuse to push up prices, when most have long-term energy contracts" ("Darling seeks UK energy price talks", 7 January).

Market prices are set at the level that balances supply and demand, irrespective of the actual costs of supply.  Suggesting that energy companies could sell at their average cost of supply rather than at marginal market prices indicates one of two things: either the much-lauded UK energy market is actually not functioning properly, because of bad design or poor regulation, or the Chancellor is ignorant of the basic rules of economics. It is inconceivable that he may be thinking that the public is ignorant of such rules and that he can get away with such blatant politicking.

After twenty years of lectures on the irrelevance of "energy policy" compared to market solutions, it's surprising to hear British complaints about the market-driven industry the UK has done so much to bring about. More sadly predictable, however, is that senior politicians should panic as prices go up, and go for the easiest non-market solution around: blaming foreign energy groups and Brussels.