There is never a good time for a blackout, but for Britain’s energy companies the timing of last month’s power failure could scarcely have been worse.

The best that the owners of the UK’s energy pipes and wires can expect in the coming years is a tighter squeeze on their deflated profits by the industry regulator. A Labour government could support nationalisation. In the meantime, investors are turning their backs on energy network companies.

The industry’s woes have their roots in years of criticism as corporate profits rose in line with household bills. In response, network companies including National Grid, UK Power Networks and SSE have consistently defended their right to profit, in part by pointing to the UK’s enviable record for seamless energy supply.

What, then, when the seams of Britain’s energy system begin to split apart?

National Grid’s report on Britain’s worst blackout in a decade, published last week, leaves more uncomfortable questions than it answers. In the aftermath of the outage, the energy giant was quick to blame the whole episode on a literal bolt from the blue. A lightning strike to the energy grid – capable of felling a gas power plant, a windfarm and a string of micro energy generators – is a conveniently blame-free explanation.

But this ignores the fact that the energy grid’s transmission lines are struck by lightning thousands of times every year. So why, on 9 August 2019, did multiple failures cascade through the system following a single strike?

Why did multiple failures cascade through the system following a single lightning strike?

The truth, buried in technical detail and mind-numbing jargon, is far more damning. It is becoming clear that the answer may be as mundane as a clutch of outdated rules and equipment settings. That lacks the drama of a lightning strike, but the implications are arguably more shocking: the blackouts might have been averted if National Grid had had a tighter grasp of the energy system it operates.

The report comes just months after National Grid was forced to make the system operator a legally separate division, to see off calls for it to be stripped from the FTSE 100 energy business altogether. Critics, including Dieter Helm, professor of energy policy at Oxford University, argue that a company operating in the public good should not be accountable to shareholders.

National Grid admitted in its report on the blackouts that it might need to review the rules for how much back-up power it keeps in reserve, and speed up existing plans to toughen other rules that guard against blackouts.

In the week ahead, the government’s energy emergency committee looks set to turn the glare of scrutiny on to regional energy networks and rail companies too. Its report this week is likely to ask tough questions about why National Grid’s lapse was allowed to engulf planes, trains and hospitals.

Here again, tedious protocols and preparedness will take centre stage in place of discussions over lighting bolts and the systems that keep the energy grid’s fragile 50Hz frequency steady.

These are the nuts and bolts of keeping Britain’s lights on, and they matter. It is the responsibility of the companies that profit from running public infrastructure to keep hospitals running and trains on track, and energy companies have prided themselves on this in the decades since public ownership gave way to privatisation.

If companies believe they are merely defending their record on the events of 9 August, they are mistaken: they are defending the right to profit from an essential service that they had promised to protect.

Europe must say ‘nein’ to Germany and spend, spend, spend

There were only a few bets against the European Central Bank cutting interest rates and restarting its stimulus efforts last week. It was a racing certainty that ECB boss Mario Draghi would react to the dramatic slowdown across the eurozone, especially in manufacturing production. The financial markets were primed.

Draghi was in combative mood, telling Europe’s leaders they must not rely on this cheaper borrowing to revive the 19-member bloc’s fortunes. He said eurozone nations with solid finances “should act in an effective and timely manner” to support growth by loosening their purse strings. The countries he has in mind are the Netherlands, Germany, Austria, Ireland and the Baltic states.

Berlin is understood to have looked at a €50bn spending package of spending after figures for August showed industrial production down 5.2% year on year. But finance minister Olaf Scholz played down the prospect, saying the problems were more about “the optics” than a real crisis.

Chancellor Angela Merkel added to the sense of inertia when she said there was no need for a fiscal stimulus package, claiming that public investment was already high and the abolition of an income tax surcharge for most employees from 2021 would support domestic demand and, with it, overall growth.

Draghi, who will be replaced at the ECB next month by current IMF boss Christine Lagarde, must have his head in his hands. He knows only government spending on education, skills and investment will propel the eurozone economy back to health.

It’s time for Brussels to step in. Pierre Moscovici, the commission’s outgoing economics chief, has backed Merkel’s parsimony. His replacement must take stock of Europe’s economic decline and back a looser spending policy.

Hong Kong’s tilt at the LSE never stood up to scrutiny

Well-played, the board of the London Stock Exchange Group. Its rejection of the Hong Kong exchange’s cheeky £32bn share-based offer was unequivocal. The bid had “fundamental flaws”, said the LSE, and there was “no merit in further engagement”.

Exactly right. The statement on Friday mocked, in effect, the bidder’s pretence that a takeover could be executed swiftly and easily. National and security considerations are always uppermost in deals involving major stock exchanges. The LSE’s own “merger of equals” with Deutsche Börse was killed by the European commission in 2017.

In the case of Hong Kong Exchanges and Clearing (HKEX), political complexities would run far deeper. Despite the attempt of its chief executive, Charles Li, to portray HKEX as an everyday multinational, with a standard collection of bland institutional shareholders, the inescapable fact is that six of 13 board members are appointed by the Hong Kong government.

“There is no doubt that your unusual board structure and your relationship with the Hong Kong government will complicate matters,” said Don Robert, chairman of the LSE. Quite. Hong Kong is in turmoil and China’s commitment to “one country, two systems” governance has rarely looked weaker. The LSE is a major clearing house for euro- and dollar-denominated derivatives, so financial regulators from the UK, EU and US would have crawled all over the deal.

In principle, scrutiny could result in a structure that satisfied regulators; these things are not impossible to design. But the idea that the process could be quick is a non-starter. The LSE would be in limbo for a year or more. Worse, since HKEX is mostly offering to pay in the form of its own shares, LSE investors would be hostage to a HKEX share price that can be blown around by Hong Kong/China politics.

By contrast, the LSE’s proposed $27bn (£22bn) takeover of data and analytics group Refinitiv – which HKEX demanded be dropped – is agreed and popular. A Hong Kong mystery tour has no appeal.