Climate Policies: Real Economic Damage Fighting an Imaginary Problem

Sir Ian Byatt describes the self-induced plight of the UK, the nation perhaps most dangerously undermined by ill-advised energy policies supposedly to control the future weather.

Climate change is not the problem, but policies to fight it are. This blog has noted reports from Australia, Canada, France, Germany, the Netherlands, and the US (links below), with the UK now added.

H\T to Climate Scepticism for providing the text of his presentation UK Economy mired in Green Aspirations. Excerpts below with my bolds and images.

Successive British governments embrace the official policy consensus. Pressure groups, the environmental NGOs, and the science lobby, including the Royal Society (nullius in verba?) have persuaded the establishment, including the current Prince of Wales, that the UK should be an international example of virtuous behavior.

The UK is unique in setting targets for reduction in CO2 emissions in legislation, with government claims to be on target to meet them.

Parliament, with cross-party support, passed a Climate Change Act in 2008 stipulating a 60% reduction in CO2 emissions from 1990 levels by 2050. This was increased to 80% during the passage of the Bill. An independent Parliamentary Committee was established to recommend five-yearly carbon budgets designed to achieve these objectives; this committee has recommended a reduction of 57% in CO2 emissions by 2030.

January 2017 actual low carbon generation and demand (top). Note that the Y-axis scale is daily markers. There are two key observations. The first is that low carbon generation does not yet get close to satisfying 100% of UK demand. Any wind curtailment must, therefore, be down to local grid congestion, especially in Scotland. The second is that the residual is dominated by the diurnal demand cycle which means that high carbon dispatchable power is not yet adversely challenged by the current level of renewable penetration.

From Energy Matters: Centrally Planned UK Generation Scenarios for 2030

The cost of meeting these targets, in the form of levies, taxes, and subsidies, has been estimated by Peter Lilley, one of the handful of MPs who voted against the Bill. He calculates a cumulative cost of over £10,000 per household between 2014 and 2030.[ Peter Lilley £300 Billion: the cost of the Climate Change Act Global Warming Policy Foundation 2016. Already £327 per household, rising to £1390 in 2050.]

These costs, estimated before the shale revolution, and excluding the costs of the EU renewable energy directive, would bear particularly heavily on vulnerable companies and poorer households while benefitting landowners who rent out their land to suppliers of renewable energy.

Policies are also highly interventionist. Ministers have killed the competitive wholesale market in electricity supply, which, following privatization, had reduced electricity prices. The choice of electric power generation is now made by ministers, not the market; the additional costs being loaded on to customers via higher prices.

Environmental pressure groups provide both the inspiration for the virtuous and the votes for the aspiring politician. They emphasize “the tragedy of the commons”, not the power of innovation. They stress the consensus in science, not its challenges and its search for new information.  With virtue comes certainty; rules crowd out compromises, negating the value of cost-benefit analysis, which has become a tool to convince rather than to question.

We need to change the whole storyline, making environmental and climate policy consistent with the pursuit of higher productivity and higher income for the people. Unhappily, economists are failing to do this.

Such a shift should be supported by a focus on incentives and constraints, particularly institutional incentives and constraints, closely linked to the resolution of political and social conflicts.

This should include more honest calculations of the incremental costs of expanding electrical power networks, fully allowing for all system costs, including backup power, not just costs of types of generator, and incorporating the incremental costs of transmission and unpredictable intermittency.
Getting economic analysis back into political, social and decision making will involve incorporating the particularities of human behaviour at both the individual and collective levels. This is not an easy task, but a convincing intellectual victory must respect the conflicts and confusions of our fractured world.

Read more at Science Matters

Comments (17)

  • Avatar

    Spurwing Plover

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    Wind Turbines are harmful to Birds and Bats and the turbines cuase a terrible noise disturbing to neighbors or anyone who has to live close to them and besides radicals enviromentalists would like to see grandma freeze becuase their idiotic ideas on Climate Change is cuased by backyard BBQ.s and SUV’s

    • Avatar

      rakooi

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      After I just informed Always Spurning Plover,
      that I walk daily thru hundreds of these 500 foot turbines
      HE REPEATS the same BS!
      (complete with dreadful spelling and NO punctuation) .
      …and in nearly a decade I have found JUST 1 (ONE!) BIRD that MAY have been killed by a turbine…
      National Statistics indicate the Tens Of Millions of birds and bats are killed by feral cats, and Glass Buildings and Vehicles….ONLY A FEW THOUSAND by these
      Gentle, Quiet and graceful WIND TURBINES kill fewer than a few thousand.

      THANKS to WIND, SOLAR and Nat. Gas competition being enabled by the Obama Admin….ELECTRIC RATES have been CUT by double Digits in Texas Competitive markets…nationally about 1%
      ….WHERE DID RATES GO UP? WHERE the killer COAL & OIL energy monopoly rules!

      • Avatar

        Sonnyhill

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        Consider the spacing required by 500′ turbines, walking past hundreds of them would be a marathon. Do you pack a lunch? Or take a bottle of ripple and dine on pheasant ?

        • Avatar

          Jireland

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          What’s funny about this is that if he isn’t lying he’s just outed himself as a shill for the wind industry. Nice own goal rakooi.

          • Avatar

            Sonnyhill

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            Coyotes find the bird carcasses before dogs like him. RAKOOI is a lying shill.

      • Avatar

        Curious

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        Rakooi, you criticism of anyone’s spelling and punctuation is rather a case of the pot and saucepan!

      • Avatar

        David Lewis

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        RAKOOI, you continue to lump natural gas, a fossil fuel, with wind and solar power so you can create an illusion that competition from wind and solar power drive prices down. Prices have been driven down but it is competition from natural gas. I have mentioned it several times and will continue that anyone who thinks wind and solar power are economical needs to look at the disaster of Germany’s energiewende.

        • Avatar

          Sonnyhill

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          Burning natural gas produces new water, in its vapor form, an acknowledged greenhouse gas. NIMBY’S hate coal ‘s byproducts, so………….
          Nat.gas gets a free pass.

  • Avatar

    Sonnyhill

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    The Nanticoke Generating Station is currently being demolished by the Ecoterrorists from Queens Park, Toronto. Once the source of 25% of Ontario’s electricity, it will be replaced with 44mw of solar panels (noon, not midnight)
    Even if only one of the eight turbine generators was converted to natural gas, 500mw could be saved. Or build nukes, it’s in the middle of nowhere, a pre-requisite getting harder to locate.
    The Liberals won the last election by campaigning against Common Sense.

  • Avatar

    Amber

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    Ontario loves their Liberals . Alberta not so much . BC loves
    money launders and the take over by China courtesy of Prime Minister Photo Op .
    How did Ontario end up as a have not province ? They deserve another pathetic socialist Liberal government .

  • Avatar

    Sonnyhill

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    It would be a win-win for Canada and Ontario if we got back to being a net contributor to Ottawa. These Socialists couldn’t resist parasitism for their business model. Yes, Amber, Toronto is blocking pipelines AND taking handouts from Alberta. Cynical.

  • Avatar

    G

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    Can anyone name a single leftist who understands AND acknowledges economics? (Not just fantasy economics – but systems that work in the real world.)

    Perhaps leftists should be outed as “economic deniers” or “economic illiterates”.

  • Avatar

    Sonnyhill

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    Justin Trudeau’s daddy, Pierre, a lawyer and erstwhile Communist, understood economics just enough to derail Capitalism. Exploited fiat currency like Obama.
    You see, Pierre is long dead, left a trust fund to his kids and suffered not a twaddle in the process. His photogenic child prodigy is carrying on the family line of work, sticking it to Alberta and its oil. How can this keep going? Living off Uncle Sam while hiding behind its military.

    • Avatar

      G

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      That’s a perfect example. Some devoted socialists are certainly smart enough to understand true economics (others are just fools). This gives them an advantage when creating their inevitable deceptions. Socialists like Trudeau must know enough to avoid the most obvious logical or rhetorical pitfalls while establishing their own hold on power.

      In fact, socialists rely upon free market economics to sustain their economies; sometimes over the long term as they build power while playing games of class warfare and entitlements, like Trudeau. Sometimes it’s only a short term concession until they can implement their totalitarian”revolution”, as with Hugo Chavez. After totalitarian control is achieved they don’t much care about economic success; they need only enough function to keep the system itself intact. In Hugo’s case Venezuela couldn’t even clear that low set bar for long.

  • Avatar

    Sonnyhill

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    You have 35 million northern neighbors, most of them think a warming climate is a problem! and paying carbon taxes can fix that problem!
    Fertile soil for political exploitation. If there is a candidate willing to point out the obvious idiocy, he / she has no chance.

  • Avatar

    Spurwing Plover

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    Solar Panels are also harmful to birds so why isnt The Audubon Society or Greenpeace opposing them? Oh yeah their not part of these Eco-Wacko ideology of their wacko paradise

  • Avatar

    Spurwing Plover

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    Liberal enviromentalists weenies need to start using Hot Air but theres only one Al Bore and Greenpeace is too busy sailing all over the world making total pests of themselves

Comments are closed