Coalition Disarray on Energy Policy

Usine de la Rance
La Rance Tidal Power Station in France – image by JaHoVil via Flickr

The Energy and Climate Change Select Committee (sic) has produced a report accusing the Treasury of (in the BBC’s words):

making the government’s clean energy revolution unworkable and creating the risk of higher household bills.

Tim Yeo, the Chairman of the Committee, is upset that the government will not now act as guarantor for loans for building green power schemes:

This will result in higher borrowing costs, and make banks less likely to make loans.

Mr Yeo is also championing the wind energy industry:

The chancellor is being urged by backbenchers to make major cuts to the support for onshore wind. That would cause serious damage to the industry.

This is another thing that will have a perverse effect because onshore wind is the cheapest way of meeting our renewables targets.

The Treasury responded that it was increasing the price of fossil-fuelled electricity:

He also pointed out that the Treasury had introduced the controversial carbon price floor to push up the cost of fossil fuel generation, with the aim of making alternative low-carbon energy sources more attractive economically.

So there you have it.

The climate change brigade complaining that the government isn’t providing enough of our taxes to subsidise wind power, and the Treasury defending itself by saying it has made fossil fuel more expensive.

Nobody mentions where those “renewables targets” came from. (They were agreed by Tony Blair.) But they are all agreed on one thing: we should pay more – all of us. They are only debating how much we should pay through our taxes, and how much through our energy bills.

The green power lobby has consistently claimed that green power will be cheaper. They were lying. Green power is more expensive. If it wasn’t, it wouldn’t need government help.

Meanwhile, the government still refuses to give any support at all to the Severn Barrage tidal power scheme. That would provide a huge amount of power from a tidal power station built across the Severn Estuary. The government decided not to build it on the spurious grounds that it couldn’t be financed without government support. It would cost, by the way, less than the HS2 High Speed railway.

The government claims it is in favour of nuclear power. But so far no company has made a final decision to build any new nuclear stations. They take several years to build and the energy crunch comes earlier, in 2016, when the EU shuts down Britain’s big coal fired stations because they produce too much carbon dioxide.

E-On and RWE, two big German energy companies, pulled out of their plans for nuclear stations in Britain in March, saying that

nuclear power was simply too long-term an investment in the current economic climate.

The government’s energy policy is all over the place. It is not that they are supporting the wrong things, or doing the wrong things, but simply that they appear to have no clear or consistent policy at all.

Now it is fair to point out that the Energy (and Climate Change) department did have the misfortune to be led by Chris Huhne for a couple of years. He left in February though. He was replaced by Ed Davey, who has made no impact at all as far as I can see.

What an utter shambles it all is.

The tragedy of this is that there is a workable consensus on energy, regardless of the debate about climate change.

Sure, people like me want coal fired power, and the greens want windmills. We can argue about those until the cows come home.

But let’s all get on with the bits we can agree on. We all ought to be able to support the Severn Barrage and new nuclear stations (with the possible exception of the lunatic fringe of the green movement, and they will oppose anything). The government says it wants to invest in infrastructure – well, here are some ready-made infrastructure projects waiting for their financial support.

Mr Davey needs to get off his bottom and promote a clear vision for Britain’s energy policy. Most of it need not be controversial – but if he doesn’t get a move on, we will face an energy shortage within only a few years.

Wind or Gas? Does DECC Even Know the Difference?

Chris Huhne, environment spokesman of the Libe...
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Chris Huhne – A Bad Case of Wind

The new head of the CBI has warned that the British government’s “green” policies are driving businesses abroad.

Recently, Tata Steel cut 1,500 jobs in the UK, saying that

EU Carbon legislation threatens to impose huge additional costs on the steel industry.

And a new book has been published by the thinktank Civitas called The Green Mirage, that estimates the consumer subsidy (i.e. extra added onto our fuel bills) for renewable energy will total £100 billion by 2030.

Here’s what the Department for Energy and Climate Change had to say:

The Government’s energy policies are focused on keeping lights on in the cheapest, cleanest way, making sure that consumers get the best deal in both the short and long term.

If we don’t shake free of our addiction to fossil fuels, if we have to rely on evermore expensive imports and leave ourselves at the mercy of international oil and gas prices, the impact on bills will be worse, the future for our energy security far bleaker.

You see, we need to make people pay more for their energy to avoid relying on “expensive imports”. And we need to avoid being “at the mercy of international oil and gas prices”, by putting ourselves at the mercy of the wind-speed instead. But hey, they can use the new “smart meters” to cut people off when the wind stops, after all.

I am not completely sure what he meant by the bit about “oil and gas prices”, actually. Oil is not generally used to generate electricity, so the oil price is pretty much irrelevant to electricity bills. Perhaps he was thinking of snake oil.

Britain has a looming energy gap, which will hit us within the next decade. Because DECC have been so keen to go for wind power, they have effectively done nothing to close that gap. Eventually the power cuts will begin, and DECC will come up with an emergency plan to produce more power – claiming, of course, that it is part of their long term strategy to ensure energy security and climate change targets.

The quickest option is gas-fired power stations, which are easy and cheap to build. Expect, therefore, an emergency programme to build gas-fired stations by the next government. They will probably blame it on the short-sightedness of David Cameron, or possibly even claim they are doing it to stay “green” (by replacing coal with gas).

The only issue will be that the output of British gas fields in the North Sea is falling. So we had better keep on good terms with Mr Medvedev and Mr Putin, because we’re going to need their help rather soon with some big imports of gas.

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Let Them Eat Porridge

The government’s “new Chief Energy Scientist”, Professor David MacKay, has given an interview.

He claimed that the UK’s “energy footprint” was twice the amount in the official figures. (I’m assuming he really meant “carbon footprint”.)

The reason our emissions are twice as much as we thought is apparently the fact that we should include the emissions of China when it makes goods for export to Britain. Apparently it is consumption not production that matters.

I look forward to Professor MacKay doing his calculations again, this time removing from the UK figures all the emissions associated with Britain making goods for export.

“Rather than falling by over 15% since 1990, [our emissions] actually rose by around 19%. And even this is flattering, since the UK closed most of its coal industry in the 1990s for reasons unrelated to climate change,” said Professor MacKay.

So the reductions from the move to gas fired electricity generation “don’t count”. Perhaps reductions from the adoption of renewable energy wouldn’t count either, for Professor MacKay. Perhaps it is only cuts in living standards that really would count. (Maybe he did really mean “energy footprint” after all.)

He was quoted as saying, “This not only means that the true scale of required emissions reductions in the Western world will be much higher but that the impact on economic growth and living standards there will also be more severe than so far believed.”

Let me be clear. I am not a “global warming sceptic”. I accept the need to cut CO2 emissions. Where I part company with Professor MacKay is in his apparent insistence that the only solution that will “count” is to cut our living standards.

He wanted us to stop looking at current emissions and instead think about our emissions over the last 125 years. “By historical emissions per capita the top three are America, Germany and Britain so we are right up there on the winners podium for carbon dioxide emissions per person over the last 125 years.”

So it doesn’t matter how much we cut now. We will still be guilty, guilty, guilty.

And that’s what it’s all about, isn’t it, for so many on the extreme fringe of the global warming debate? It’s a guilt trip. They don’t want solutions, they want us to feel guilty.

And to them it’s not the carbon footprint that matters, it’s the energy footprint. We must atone for the sins of the last 125 years by cutting our living standards now.

According to Prof MacKay’s autobiography he “still eats salted porridge”. Obviously he wants the rest of us to join him.