The FT has reported that:
Philip Hammond has warned Theresa May that her plan to reduce greenhouse gas emissions to net zero by 2050 will cost the UK over £1tn.
In a letter to the prime minister seen by the Financial Times, the chancellor said the cost meant that less money would be available for schools, police, hospitals and other areas of public spending. He also warned that the target would render some industries “economically uncompetitive” without huge government subsidies.
Whwre to begin with simerh8ng as inept as this. I think b6 adding a few more quotes, to add some colour.
Mr Hammond warned in his letter – sent last week – about the implications of going ahead with the new target, which is much tighter than the UK's current policy of cutting emissions by 80 per cent over the same period. The CCC has estimated that reaching net zero will cost £50bn a year, but the department for Business, Energy and Industrial strategy puts the figure at £70bn, according to the chancellor's letter. “On the basis of these estimates, the total cost of transitioning to a zero-carbon economy is likely to be well in excess of a trillion pounds,” he wrote.
H[ammond] added that reaching the net zero target would require heating to be almost entirely decarbonised, leaving households having to replace gas boilers with alternatives such as heat pumps, which cost “three times more”. Homeowners would also need to spend thousands or tens of thousands of pounds on insulation.
Unless, of course, we do a Green New Deal to help them. Which we will if we want to survive. But Hammond revealed his true priority:
Although the 2050 target is backed by some business leaders, Mr Hammond argued that industry would face “significant costs” from shifting to low-carbon processes. He pointed out that unless competitor countries adopted the same policy, the shift could render “key industries” – such as the steel industry – economically uncompetitive or dependent on permanent government support.
And he added:
there would also need to be significant changes to farming practice and a total ban on petrol and diesel cars by 2050, along with a tenfold increase in electric charging points.
And:
there would need to be an “ambitious policy response” in the current Parliament for the new target to have any credibility. This would almost certainly include increased government spending, meaning less money available for other areas of public spending.
As a result;
The chancellor urged Downing Street to support a review by the Treasury that would look at how to minimise the cost of the policy for taxpayers and consumers to prevent “potentially damaging impacts”. He also suggested that the government give itself an “explicit review point”, or a get-out clause to reconsider the target if other countries did not follow suit.
This letter is quite extraordinary. Take the last comment as an indication of why. Hammond still thinks there is an opt out clause from the global environmental crisis. And that what really matters is consumer convenience and keeping everything going on as if nothing is really happening. Whilst he apparently thinks that the costs are just an inconvenience that must be managed, but within existing constraints so that no one has their ambition for a holiday in the Bahamas (or wherever he thinks people holiday) disturbed.
I suspect that Hammond is far from alone in suffering his delusion. He will also not be alone in finding it hard to imagine that if we are to survive as a race here on earth then a very great deal that has to change. Farming will change. So too will travel. And heating. And so our homes. And having said that so too, of course, will our finances change. As will those of government. And the respective roles of the private and public sectors may look quite different as we progress through the transition to a sustainable economy - if we succeed in doing so. And that will mean our economy will not just make different things in different ways (which it will have to, precisely because carrying on as we are is now not possible) but that we will have to accept different ways in which we govern ourselves: like it or not the choice to opt out of this process will not be on any governments' agenda.
Hammond has not got his head around even the lost basic of these issues as yet. His concern remains at the level of new boilers. We need to worry about them, and maybe car charging points. But the truth is that the real issues - the ones that will cause the big stress if we are to really transition via a Green New Deal - are the strategic and governance issues that suggest radical and existential threats to our existing ways of thinking are going to have to be managed. If he thinks what he's looking at now is going to be hard he hasn't a clue how tough it's really going to be. And that worries me. We are in for a rocky ride, most especially with those in denial who will be the obstacles to saving us all.
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Eeeee……………..he’s been at them spread sheets again Richard!
This – and his denial about increased poverty ranks him as an awful Chancellor.
Hammond truly is incompetent. On this and the national economy, he doesn’t know what he is talking about. There is a kind of solution to our fresh water and electricity needs — deep sea volcanic vents. There are two sort of close to us. One is off the coas of Iceland, while the other is on the surface in Iceland itself. They could sell us the fresh water and electricity, though we would need to lay pipes from Iceland to probably Inverness. This would mean that Scotland could control England’s fresh water and electricity supplies. Though, since Scotland is not independent and thus does not have its own sovereign currency, Westminster would pay for this infrastructure. It would be expensive, but as clean as it could ever be.
On the other hand, the UK could put a rig, like an oil rig, down on the ocean floor off the coast of Iceland and pipe the water, minerals, and generated electricity to the UK or through Iceland, probably for a fee. That would be even more expensive. And there is a down side. The disruption of an anerobic ecosystem. We know almost nothing about these systems, but since the choice is between possible extinction and disruption of a small, local anerobic ecosystem, the weighting seems obvious. This is just one avenue that could be explored, but has not been discussed by anyone as far as I know. I know the department of the environment is aware of such a scheme, but as far as I know, they have ruled it out on cost grounds. Off the coast of California there are a number of these deep sea volcanic vents, but no effort in extraction yet. They are relying on solar, which is of course for them a lot easier and cheaper.
“…..there would need to be an “ambitious policy response” in the current Parliament for the new target to have any credibility. ”
And THAT would never do. “A policy response, Minister?” I can hear Sir Humphrey saying it in that inimitable tone of slightly bemused scolding that was his trademark.
What makes Hammond so very dangerous is his air of reasonableness. You need to see his smug, vacuous grinning-Herbert impression on the Front Bench to see the reality of the man. Otherwise one could easily be fooled into thinking him stupid.
“……His concern remains at the level of new boilers. We need to worry about them, and maybe car charging points. ”
No we don’t. They are not something to ‘worry’ about. They are something well within our capacity to deal with. Not the least bit complicated, but time consuming and needing appropriately skilled manpower.
The trouble is, as you say, all of Hammond’s utterances indicate that he doesn’t recognise that there is a problem to be addressed. As far he and his ilk are concerned life as they know it has been entirely sustainable and only the slightest tweaks are necessary to keep it so. Such a combination of faith and willful ignorance brooks no rational argument.
I apologise for being extremely off-topic but I am trying to find out whatever happened to the “Socialist Economic Bulletin”. It and its archives used to be on Blogspot but they both seem to have vanished from there. I have found that it lives on on Facebook or Twitter but I don’t find usable archives there nor do I wish to join either system. I would like to get access to the archives because I rather thought that they many contained quite valuable analyses of economic issues treated from a left-wing point of view.
Or alternatively do you have a short list of places to find studies or analyses of mainly economic but also tax issues written from a left-wing (or at least not right wing – I can find those myself) point of view ?
My apologies for bothering you and many thanks for any information you can provide.
I can’t help
Sorry
David,
The wayback machine is your friend.
https://web.archive.org/web/*/https://socialisteconomicbulletin.blogspot.com/
From the above link you should be able find whatever the wayback machine has archived. It takes snapshots of websites at regular intervals, so hopefully it has the content you are looking for.
I could write at length on this stupidity – I’ll confine myself to this bit of parochialism:
“Mr Hammond argued that industry would face “significant costs” from shifting to low-carbon processes. He pointed out that unless competitor countries adopted the same policy, the shift could render “key industries” – such as the steel industry – economically uncompetitive or dependent on permanent government support.”
Based, as I am in Brussels, I talk to a wide range of industry groups. The steel bunch are one example; the euro-steel industry will go carbon neutral. They will invest billions of euros in a new production process called direct reduction – which uses hydrogen to converst iron ore into steel. The operative word is “will” (& the time frame is 10 years). Large projects are taking place as I write. The other operative phrase is “border carbon taxes”. My contacts in the Commission tell me that this is now on the table & furthermore needs no legislation to enact. Thus the “costs” faced by what is left of the Uk steel industry (working on the basis of Brexit) will be BCTs on steel exported from the UK to the EU – unless the UK steel industry also takes the zero emissions route.
In the case of “costs” – building out off-shore wind needs no subsdiy – it has a “business case”. The energy renovation of housing has a business case that varies somewhat – but is do-able and as noted could be funded through the green new deal. Hammond’s comments suggest somebody out of touch & possibly unbalanced – perhaps that is a good definiton of todays modern tory.
sorry,
I just don’t get how producing steel using the direct reduction method could in any way be described as carbon neutral,
this smacks of the self deluding magical thinking that ignores the realities of physics,
much of what is sold to us as ‘Green’ is often very far from being that,
I think they’re spinning a bit of a yarn on that one.
“I just don’t get how producing steel using the direct reduction method could in any way be described as carbon neutral,”
Hydrogen produced by electrolysis using renewable electricity is used to “reduce” iron ore into a form of iron that can then be fed into an electric arce furnace (also fed by renewable electricity). The physical process is well understood & emits………water (the H2 combines with the oxygen in the iron ore). It has zero to do with “magical thinking” & will deliver a zero carbon “near as dammit” process. Europe’s wind resource is more than capable of delivering the electricity needed (both for society as a whole and for de-carbed processes such as steel).
Thanks Mike
That is fascinating
it is odd that the cost is considered too great to act yet no consideration is given to the loss if enough isn’t done?
I’m also getting a bit nervous that if the green light is given to major changes they might be ill thought out leading to no overall improvement of the situation or even making things worse,
it’s true that part of the problem is the amount of CO2 emitted by modern society but it is equally true that the other part of the problem is the degradation of global flora that’s reduced the planets ability to cope with large amounts of CO2 being emitted,
also in tearing down the entire of our current infrastructure and building all anew we may end up with a rather swanky setup but at the cost of gobbling up much of the remaining, unsquandered, natural resources and emitting oodles of extra CO2 manufacturing and installing the new infrastructure,
I don’t think we need to throw money at the problem like there’s no tomorrow ( actually there is a good chance there won’t be a tomorrow but I meant that as a figure of speech)
when you spend money on real stuff it is rather an act of deploying energy, move something, build something, etc. it all requires energy to be expended,
what we need to do is to reduce fossil energy consumption without having to deploy excessive amounts in the process of doing it,
and at the same time we need to be enhancing the planets natural ability to suck CO2 back out of the atmosphere and radiate heat out into space,
there’s only so much rewilding you can do in Britain, it’s a pretty lush and green place already,
we should be forming partnerships with countries in the regions that are currently turning to desert, possibly former members of the British Empire where we share elements of language and similarities in governmental and civil service structure and have tolerable diplomatic relations,
these places are at the leading edge of climate change, it’s happening there now, today,
these places are where crops will start to fail and populations will see no alternative but to start migrating north to escape,
here is where we should be reversing desertification and rewilding and improving agricultural productivity in a permaculturesque manner,
back home we should be looking at a transformation of transport from private to public, personal electric vehicles for everyone isn’t realistic, we’ve already gone thru half the available lithium making batteries for silly gadgets we’ve been throwing away every 2 years, there isn’t enough for EV’s for everyone forever,
ditching the latest designs of highly efficient domestic gas boilers to convert to heat pumps or somesuch would gobble a vast amount of resources and we’d still need extra electricity to run all the heat pumps,
real world electric trains are actually diesel electric hybrids, they carry their own mini power station on board, we need to get as many trucks and diesel cars off the road and use part of that diesel to run the expanded train network,
we can’t do a lot of things realistically without still utilising portable liquid fuels due to the practicality of their energy density to volume ratio and ease of containment and storage,
a form of diesel will have to be around for a long time, probably transitioning to a bio diesel over time,
natural gas is a no brainer for heating, water heating and cooking to an extent, but we squander vast amounts of this on manufacturing plastics we use only once and making artificial fertilisers and pesticides that ruin the soil and massacre the insects,
what natural gas is available should be used most sensibly and again could transition over time to a bio gas mostly from anaerobic digesters, natural gas to bio gas only require minor metering adjustments,
and we really need to stop exporting all our rubbish and kidding ourselves it’s recycling, everything that comes into this country should stay here and be re used and reprocessed, we need to salvage all the steel, copper and aluminium from our old cars etc. and turn them into wind generators and railway track etc, not shred the cars and ship them to India or China,
the main cost of sorting out Britain is going to have to be labour, we need to do it ourselves and benefit from the fact everyone is fully occupied with the job,
we could do with doubling the cost of food to make British farming actually viable and halving housing costs so we don’t have to pay people a vast wage just so they can afford rent or mortgage payments,
my fear is that if the Tories did accept MMT & GND they’d then just outsource everything to be supplied from China with all their mates taking a skim at every stage of the transaction and we’d get none of the investment expenditure recycled through our economy.
we only have one chance to get this right, we are at the last throw of the dice,
You are saying this isn’t easy
I agree
I am not as pessimistic as you
But you have not got near the really hard bits – like global financial crises to add to the mix
“there’s only so much rewilding you can do in Britain, it’s a pretty lush and green place already,”
The Uk has amongst the lowest levels of forest cover in Europe. As Monbiot noted – the addiction to sheep farming in Plynlimon in wales directly contributes to the massive floods on the River Servern. So the UK might be green – but it’s the “wrong” type of green (grass).
“real world electric trains are actually diesel electric hybrids”
Only in the UK – where around 30% of the network is electric – compared to 50%++ in many other EU countries where electric means only-electric (with all the benefits in terms of O&M & of course emissions)
“natural gas is a no brainer for heating, water heating and cooking to an extent, but we squander vast amounts of this on manufacturing plastics”
The largest single user of natural gas is domestic space heating (e.g. 1200TWh – EU) – which needs to transition from nat gas to hydrogen. Plastics account for less than 20% of natural gas use.
In the case of bio-gas – I was talking to the head of EuroGas on Friday – biogas cannot on its own meet demand in any member state.
Despite the above comments – you made some good points in the rest of your post.
I agree bio gas has physical limitations but it does have a role to play,
I was aware we in the UK use a lot of gas to keep warm but tbh the UK would be a grim place to live without heating 6 months a year,
I know heat pumps can work in a rural or suburban setting when people have enough land around them to lay the pipework into the ground but a heck of a lot of people live in flats, apartment buildings and tower blocks in towns and cities, it’s going to have to be something like gas for them,
I get rather triggered atm whenever anyone mentions hydrogen, it doesn’t occur naturally, it has to be made or seperated from other gas mixes,
the main commercial method for making hydrogen is superheating natural gas and cracking off the hydrogen,
it’s a covert way of just carrying on producing natural gas and kinda ‘greenwashing’ it,
they’re very hazy when you ask them what they propose to do with the remaining portion of the natural gas once the hydrogen is seperated,
they overlook the energy required to perform the process too,
why not just use it as natural gas, avoid the extra energy needed to make hydrogen and sequester the CO2 released using more trees, gas is the cleanest of all the fossil fuels and a lot safer to handle than hydrogen which isn’t compatible with the current natural gas distribution infrastructure,
also the point about trains is really, if we fully electrified our rail network it would require a lot of hardware to be installed that carries a big carbon footprint and also we’d have to increase electricity generation to supply the extra demand,
diesel electric hybrids do achieve maximal efficiency whilst cutting out all the extra stuff required,
a lot of things that appear green at first then turn out to have just displaced a lot of the energy consumption to yet another layer of technology making everything even more complicated than before,
EV’s in cities only really move the pollution out of the city to a huge power station elsewhere no one can see.
sure plastics account for about 20% of natural gas use, but how much is also used synthesising nitrogen fertiliser from it using the Haber Bosch process?
and I’m all for doing whatever regreening that can be done in the UK but the need is so great we must look further afield for some really huge projects to tackle to make a noticable impression on drawing down CO2 from the atmosphere,
even if we could become carbon neutral, which is pretty improbable, we still need to remove legacy CO2 emissions currently in the atmosphere to turn the direction of climate change,
as we reduce the atmospheric CO2 level the oceans will start exhaling some of the CO2 they’ve been absorbing for decades,
we need to ‘go large’ to even make a dent in the problem,
we really are in a pickle!
and most of all, thanks to Richard, you and all the others who come here for tolerating me, I do tend to get rather animated on this subject !
I think the ‘how large we have to go’ issue is only vaguely comprehended as yet
That’s because this extends far beyond the ‘going green’ bit
It impacts everything
I get all this about climate change. But do you honestly think China, Brazil, India et al are going for a zero emission target for 2050. Somehow I don’t think so. As they say, every little helps, but USA is miles behind, Europe is doing its best, but the German powerhouse won’t reach its target…
Difficult one I know
So you say I give up and tell my children they’re not going to make it? Is that what you want? Are you doing that?
We are all doomed.
Time to just start enjoying ourselves while we can.
I hear property on Antarctica is going cheap if you want to survive as long as possible, mind you, you do have to pick your spot carefully.
Spot on Richard…not doing this is NOT an option and should not be dependent on what other countries in the world do or don’t do…they’ll get the message soon enough with worse floods, rising sea levels, air polution etc. I was disgusted to hear Evan Davis interviewing a campaigner for the climate …he asked her why should we throw all this money at keeping global warming to less than 2 degrees if other countries might not do their bit…then he said why not wait till we get to 4 degrees and then spend the money we need to put it right!!! Denial coupled with ignorance is really dangerous.
I’d like to share 2 quotes with you that are more relevent today than ever.
The first from Edward Everett Hale
“I am only one, but I am one. I cannot do everything, but I can do something. And because I cannot do everything, I will not refuse to do the something that I can do.”
..and the second by Sara Parkin, Green Party MEP from late 1980’s to 1992 – such prophetic words..
“There will be no bell tolled before the last but one tree is felled. There will be no siren before that last fateful tonne of carbon dioxide goes into the atmosphere. Our numbness, our silence, our lack of outrage, could mean that we turn out to be the only species to have minutely monitored our own extinction.”
Thanks
Richard,
I have been very interested to read over the last few month, the items you have posted, and the comments, re Green Quantitative Easing and the Green New Deal.
With Hammond’s concern about the cost etc, now being the point of issue, it stuck me as being something that not only completely misses the point, but actually misses it by a country mile.
As far as I’m concerned, the issue of climate change is no longer one for debate. The evidence for it is now so overwhelming as to make it effectively proven fact.
By chance, earlier today, I watched a YouTube video by John Englander he recently gave at the Royal Institution. In it he explains the hows and whys of how we got into our current predicament, but also he gives, in my view, a good account of what is and what is not recoverable.
https://www.youtube.com/watch?v=MvqY2NcBWI8
I recommend that readers watch this, it’s got stuff in it I’d not fully grasped before.
It means that Richard is right, we need the GND and GQE now. The debate should really be about prioritising the actions required, not, can we avoid the cost.
As John Englander says in the video, “When catastrophe hits, it doesn’t weigh up the cost implications”.
He shows that things such as sea level rise doesn’t happen smoothly over time, it has spurts. We could, if we’re unlucky have a large sea level rise relatively soon, we just have no way of knowing.
Just like we don’t know when the next earthquake of volcanic eruption will take place.
Lets just grasp the nettle and the GND and GQE are a good place for us to start, never mind what anyone else is or isn’t doing. This is a no brainer.
Thanks, and I will watch when I find something like a reasonable internet connection – which right now is not for a few hours
As one of those who was conned into buying a diesel car, I refuse to believe that diesels cannot be made cleaner in the years that they are ran down or as other energy sources grow.
It all smacks of a lack of will to me, rather than capability – new markets for these products could be found with opportunities that might keep people in work with retrofitting etc.
It is also a paucity of imagination that seems to be the hallmark of societies kept in line with the supposed ‘discipline of debt’ and investor returns. Instead of the investment society we are the debt consolidation society.