Friday, June 22, 2012

The Chancellor's Brain is Borked

Most people agree that action is needed on climate change. But most people also don't want a huge tax hike to pay for that action. Or a larger energy bill. Or a wind turbine at the end of their garden. Or a P45 because their employer is struggling to remain competitive while cutting carbon emissions. So what's to be done?

An inhospitable political climate The Chancellor of the Exchequer, George Osborne, has quickly succumbed to the simplistic idea encapsulated in the image below. "We're not going to save the planet by putting our country out of business", he says. For him, it's a simple choice between doing the right things for the planet and doing the right things for the economy. Environmental considerations are a burden, and the economy is of overriding importance. Hence the cut in support for wind energy, solar energy, and energy efficiency. He has also been trying to back out of Britain's commitments on cutting carbon emissions, while increasing subsidies for the most energy-intensive, carbon-polluting businesses. The fossil fuel lobby exerts a powerful hold on most parts of the Government, and on many MPs, Labour as well as Conservative.

Image: © lucky -
Meanwhile (against all the evidence) the talking points of the fossil fuel lobby have become commonplaces: that green subsidies are why our energy bills are so large; that wind turbines cost more energy than they produce; that wind turbine output is too variable for the National Grid; that turbine blades chop up bats and birds; that offshore wind energy is obscenely costly; that solar energy isn't viable in Britain; that the planet is cooling, not warming; that gas, coal and oil can easily be made clean; that shale gas is the answer to all our problems; that renewables can only produce a small fraction of the country's energy needs; and so on.

At the same time, the nuclear industry also exerts a strange hold over Government. Massive public subsidies for past and future nuclear power plants continue. Somehow subsidies for nuclear are fine; subsidies for renewables are not. And somehow (again against all the evidence) the timescales for new nuclear are going to plug the energy gap and cut emissions in time.

I'm not going to debunk all of these absurd anti-green myths here. Folks with more scientific knowledge have done that brilliantly elsewhere, much better than I could. Suffice it to say that there are good economic reasons why the alleged choice between the planet and the economy is a false dichotomy. Stimulating jobs and growth through green initiatives that generate energy and cut emissions will put the economy on a faster path to sustained prosperity.

All of the anti-green chaff distracts from the real discussions there need to be about questions such as...
  • What levels of support for the various renewable and energy efficiency initiatives give Britain the best economic and environmental returns?
  • Where is best to site turbines and energy storage facilities?
  • Which house-building, transport and broadband initiatives will help address both immediate social needs and longer-term energy efficiency?
And in a way, George Osborne has a point: The Stern Report suggested that the action needed might cost up to 2% of GDP. That's not going to win elections.

No, my purpose here in highlighting the Chancellor's attitude and the public mood is not to trash them, but to observe that the political climate is inimical to the action that is urgently needed to save the planet. Moreover, many of the public who accept the need for action seem to think that we can wait until someone comes up with some great technological solution, or that the US and China will sort it out eventually, or that the problem will somehow just go away. Or they just put the problem out of their minds: not so much apathetic as distracted.

This is not for want of attempts to convince the public. The compelling evidence of the risk of a runaway greenhouse effect did not break the stranglehold of denialism and passivity, perhaps because it seemed the stuff of disaster movies rather than reality.

Next, the equally compelling evidence of increasing risks of storms, floods, droughts, desertification and sea level rises also failed to break through into public concerns. Maybe it seemed too remote: in time, geographically, probabilistically.

Subsequently, alerting people to the financial costs of failing to act similarly got nowhere. For every £1 we fail to invest in cleaner technology before 2020, we'd need to spend an additional £4.30 after 2020 to compensate for the increased emissions [IEA, 2011]. But no dice: a bird in the hand, and all that.

Now we'll have to wait to see whether people are convinced by the argument that the way out of the economic mire is in promoting green jobs and green growth. I'm not sure this will get through to people either: mindsets are hardening around a austerity-stimulus dichotomy that fails to take account of the interrelatedness of the economy, infrastructure and carbon emissions.

And while there are mass protests on the streets about pensions and about certain companies' tax bills, the idea that anyone but a hardcore of green activists would protest about the Government's failure to protect the planet from environmental disaster is seen as slightly wacky.

When Friends of the Earth is wasting its energies during Rio+20 attacking the leading green advocate in the British Government, you know that this inhospitable political climate is not changing any time soon.

So what's to be done?

Germany gets 20% of its electricity from renewables [Guardian, 30 May], the UK under 10%. What's striking though is who owns the means of production. In Germany, over 65% of renewable energy capacity is owned by individuals or communities: typically home solar panels and wind turbines in farmer's fields. In the UK it was less than 10% in 2010 (although this will have increased slightly in the last 18 months, because of the great success of the Feed-In Tariffs scheme, now sadly hobbled).

So British homes and businesses remain under the thumb of the big energy companies, while a huge number of Germans get to control their own energy, get cheaper energy, cut emissions, and make money on the leftover electricity they feed into the grid.

In Britain we like to grumble about our energy bills (driven higher by the rising cost of imported gas) but quite reasonably object to energy companies trying to plonk turbines down in local beauty spots. Why should we bear the environmental downsides of those turbines if the only benefit we'll see is maybe a small decrease in our bills in a few years time, shared out across the whole country, and only if the energy companies are kind enough to pass on the savings to consumers?

Instead, we can drive those energy bills down by owning local turbines ourselves and reaping the benefits.

The Chairman of the Commons energy committee, Conservative MP Tim Yeo, was almost there in his suggestion that local communities should be "bribed" to accept local wind farms.

But getting thrown a few scraps from the big business trough doesn't sound as great to me as your neighbourhood controlling its own energy, getting cheaper energy, cutting emissions, and making money on the leftover electricity that's fed into the grid.

Instead of so much human energy being wasted in emotionally charged planning battles between electricity companies and concerned residents desperately fighting damage to their neighbourhoods, residents can make their own decisions on where (or whether) to site wind turbines.

And not just that: once local councils realize the benefits of supporting these kinds of local initiatives, perhaps funded by taking a small cut of the income, who knows what innovations in energy generation and efficiency may result? For example, maybe the council would choose to invest in offshore wind farms, as the premium its residents are willing to pay to avoid the local environmental cost of onshore wind [Bassi, Bowen and Fankhauser, 2012]. New advanced modelling of the economic impacts show that, despite the propaganda, offshore wind has huge benefits for GDP, jobs and trade [Cebr, 2012].

Onshore or offshore, local communities would be seizing the initiative, rather than waiting for self-serving energy companies and fugacious politicians; and this would be the beginnings of a move from passivity to action.

Maybe people will then eventually notice the lack of political will at national level, and demand action.

As some wise fellow once wrote:
"Citizens need to be able to experience both the benefits and costs of their decisions locally, or we will continue blithely down the path towards environmental calamity."

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