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The real economics of ‘net zero’

Wind turbine in winter. A calm scene, but cold winter temperatures in Britain are often accompanied by zero or light winds… Photo PBouman/shutterstock.com.

Why is it so difficult to have a grown-up discussion – or any discussion at all – about the government’s net carbon zero commitments? But as the costs hit home, discussion cannot be avoided…

Net zero – the ideal balance between the generation of greenhouse gases and their removal from the atmosphere – has become an unquestionable dogma. It’s hard to have rational discussion about it.

Yet the drive to “net zero” is distorting decisions on energy supply. And it fails to recognise the essential part energy plays in manufacture and industry.

November’s COP27 conference in Sharm el-Sheikh, Egypt, is an example of this thinking. We heard the repetition of doom-laden warnings, from the United Nations and myriad other self-appointed climate experts. “We’re on the verge of disaster” they shriek, again. “Tomorrow will be too late, we must act now”. Step forward presidents, prime ministers and other world leaders to nod wisely and concur that something must be done.

With over 33,000 attendees, jamborees like this are big business. They gather a momentum of their own. COP27, as its name implies, was the 27th such meeting since 1995. The United Nations has a whole bureaucracy devoted to climate change, and it runs many other international meetings besides the main conferences.

No debate

But they are not really conferences at all, there is no debate. They are no more than a platform from which to declaim the same message. It’s all about presentation. So when the new prime minister, Rishi Sunak, announced he was too busy to attend, his colleagues, ever interested in embellishing their green credentials, pressured him to change his mind.

What all those attending agree on is that the world must stop burning fossil fuels. The problem with this view is that fossil fuels have been, and are, the engine for progress in the world. Coal, oil and gas are readily available and relatively easy to extract.

Since the industrial revolution fossil fuels have enabled a transition from predominantly land-based agricultural production, typified by feudal economies, to manufacturing production which dominates the world today.

Modern industrial manufacture relies on energy other than human or animal power. It has created a world where food production is at a level previously unimaginable, and it underpins all aspects of life we now take for granted – health, education, housing, science, technology and culture.

Pious aspiration and reality frequently collide where energy is concerned. For example, the German state of North Rhine-Westphalia announced it would phase out the extraction of coal by 2030, as did RWE, the energy company that owns the large Garzweiler mine there.

Now rocketing fuel prices and a dependence on Russian gas have caused a change of heart. In line with the country’s new coal policy, the mine is being expanded, at the expense of a wind farm!

In Britain, the correct decision to approve the construction of a new coal mine in Cumbria has provoked a predictable backlash. Friends of the Earth (FoE) responded that as steel makers move towards greener production methods, the mine’s coking coal would be unmarketable. This claim, repeated uncritically in many media reports, confuses what may be theoretically possible in the future with what is commercially viable now.

Unproven?

Ironically, FoE criticises the government’s 2021 net zero strategy, dubbed “Build Back Greener”, as based too much on as yet unproven technology! There’s plenty to say about the shortcomings of that document, not least the associated costs, which FoE does also point to. But alleging that one set of as yet unavailable technology is better than another isn’t the way forward.

The Climate Change Committee, advisors to government on climate change, joined the charge about the new mine. Its chairman Lord Deben bemoaned the “…damage to the UK’s leadership on climate change”. Even globetrotting John Kerry, now President Biden’s special envoy for climate change, warned that “… he was examining the decision”. He did not explain quite why the USA thinks it has any right to involve itself in the matter.

Trailing along behind as ever, Ed Miliband, shadow climate change secretary, says the Labour Party would “leave no stone unturned” to stop the mine, “if elected” of course. And they would instead deliver green jobs, without saying what they might be and how they would appear.

The claims put forward to support the aspiration of net zero are not backed up with evidence. Rather, they are intoned as articles of faith. The irony that the proposed mine will be an industry leader in controlling emissions, and a significant step towards the greener steel industry they claim to aspire to, is lost on green fundamentalists and uninquisitive politicians.

The energy policy of this government, and its predecessors, appears to be in thrall to the climate lobby, who insist that fossil fuels must be wholly replaced by renewables – and they are not that keen on nuclear power either.

Wind power is the prime example. It is an intermittent power source – onshore or offshore. Other capacity must be on standby, especially when there’s little wind during a cold spell – as we experienced in December 2022. That means using fossil fuels, at least until Britain rebuilds its nuclear power generation, and the additional cost of maintaining standby capacity.

Rebellion

Sunak’s earlier decision to maintain strict planning regulations on the construction of more onshore wind farms has now been effectively reversed in the face of a rebellion of his backbench MPs and current high energy prices. Instead the government will consult on letting local authorities decide – the opposite of a national energy strategy.

The argument that wind power is cheap does not stand up. There is more to consider than running costs and output while the blades are spinning. Wind power is subsidised, yet companies are paid the market price for the electricity generated – currently almost wholly dependent on the spot price for gas, the main component of the energy mix.

‘We’re paying a high price for a form of power which is unreliable and cannot be effectively stored…’

Factor in the cost of manufacture, construction and transport, concrete for the base, steel for the pylon, fibreglass and plastic for the rotating housing and blades, all carbon intensive products in themselves. Then add the cost of connecting to the grid and power lost in transmission; the windiest sites are often remote from cities. And turbines don’t last forever – renewal or replacement costs are not trivial.

Then there is the loss of productive agricultural land. Farmers can get more income from their land from turbines (or solar farms) than from keeping animals or growing vegetables. That increases our imports and reduces food security.

It’s a high price for a form of power which is unreliable and cannot be effectively stored, although there are inevitably promises that effective storage and reliable supply will be possible in future.

Net zero is touted as an unquestionable benefit. But it is cover for an attack on us all, at work and at leisure. Affordable and reliable personal transport will be outlawed, efficient gas boilers will be phased out, and so on. Food and manufactured goods will be much more expensive – out of reach for many, because of a dependence on “the market”.

Vague

There’s a vague, unfounded, hope that we can import what we need, when we need it and that solutions will appear, as if by magic. That approach is short sighted and unsustainable, as recent events have highlighted.

Aside from approval of the Cumbrian mine project, this government has done very little about energy resilience. But we cannot be complacent that it will even stick to that decision. Workers must make it clear that we do not believe the dogma, and that we are determined to make for ourselves a brighter future.

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