Global warming, climate change, all these things are just a dream come true for politicians. I deal with evidence and not with frightening computer models because the seeker after truth does not put his faith in any consensus. The road to the truth is long and hard, but this is the road we must follow. People who describe the unprecedented comfort and ease of modern life as a climate disaster, in my opinion have no idea what a real problem is.
“Many states and businesses are backing off ambitious climate targets, and Democrats are less vocal nowadays about climate change. Tech companies are using more natural gas to meet exploding demand for data centers. The International Energy Agency, after some browbeating by Mr. Wright, is revising up its projections for how long fossil fuels will stick around.” – New York Times
“Many states and businesses are backing off ambitious climate targets, and Democrats are less vocal nowadays about climate change. Tech companies are using more natural gas to meet exploding demand for data centers. The International Energy Agency, after some browbeating by Mr. Wright, is revising up its projections for how long fossil fuels will stick around.” – New York Times (below)
Brad Plumer, a “a Times reporter who covers technology and policy efforts to address global warming,” recently explained (September 23, 2026) the “energy dominance” position of the Trump Administration. “The Former Fracking Executive Selling Trump’s ‘Energy Dominance’ Vision” began with the subtitle: “Energy Secretary Chris Wright is pitching a future of fossil fuel abundance. It’s not always an easy sell while war drags on and oil prices surge.
A fair article like this would have incensed the late Joe “head exploding” Romm. But the bully is gone, so others of less stature are left to fuss (see the reader comment below).
The Article
Quotations from the Plumer article follow:
“… Energy Secretary Chris Wright brought a sunny message to Houston last week at a gathering of energy ministers from the G20 nations. The Trump administration, he said, was ushering in an era of energy abundance by expanding oil and gas supplies in places like Alaska and Venezuela.”
“Mr. Wright acknowledged some tension, though he insisted it was temporary. ‘Everyone’s frustrated with higher energy prices,” he said of the mood at the meeting. “But I’ve not met one person who’s comfortable with a nuclear-armed Iran. So everyone gets what we’re doing and this is a critically important mission. It creates dislocations in the short term. But the only answer to short-term dislocations is the energy abundance agenda.’”
“Whereas Mr. Trump speaks bluntly about energy — chanting ‘drill, baby, drill,’ calling wind turbines ugly, or claiming that global warming is a hoax — Mr. Wright gives his arguments an intellectual gloss. He cites figures on how solar panels underperform during winter storms. Or he argues that global warming is not as big a problem as energy poverty, which he says can only be alleviated with more oil, gas and coal, even if that means more planet-heating greenhouse gas emissions.”
“Administration allies say that has made Mr. Wright invaluable. ‘He has been one of the most consequential picks for energy secretary I’ve seen,’ said Thomas J. Pyle, president of the American Energy Alliance, a research group that promotes fossil fuels. ‘He’s very experienced, brings a lot of substance, and he articulates President Trump’s vision clearly.’”
“… Ben Dietderich, an Energy Department spokesman, said in a statement: ‘Secretary Wright doesn’t have preferred energy sources. He just believes in being honest about math and energy security. Unfortunately, many in the climate lobby don’t like that. The Department is proud to have ended energy subtraction policies that lead to higher prices, less energy security and human impoverishment.’”
“[Wright] argued that people in developing countries still lacked enough energy to enjoy a decent standard of living and that renewables couldn’t replace oil, gas and coal to provide that power.”
“’At the height of this era when everyone was saying energy policy should just be about climate, Chris Wright was one of the few C.E.O.s that ran oil and gas firms who clearly and vocally spoke out,’ said Arjun Murti, a partner at the energy research firm Veriten.
Mr. Wright also had a flair for the dramatic. He once drank fracking fluid on video to show it was safe. In 2021, he rented billboards around Denver to heckle The North Face after the company declined to work with an oil firm.
“Mr. Wright quickly transformed the department. Out were programs to develop novel technologies to fight climate change, like green hydrogen or low-emissions steel. Instead, federal funds went to help utilities finance gas plants, nuclear reactors and transmission lines or upgrade older coal plants, which officials say are essential for meeting rising electricity demand. Mr. Wright also lifted a Biden-era pause on expanding exports of liquefied natural gas, now the nation’s fastest-growing export, and has pressured Europe to ease rules on methane, a potent greenhouse gas, saying they could hurt U.S. exports.”
“’He brought a whole new attitude to the agency,” said Scott Segal, an energy lobbyist at Bracewell. ‘It’s all about how do we produce enough energy to support A.I. and economic growth.’”
“Mr. Wright, who often criticizes wind and solar for not running at all hours, has cut renewable energy programs and renamed the National Renewable Energy Laboratory as the National Laboratory of the Rockies. While experts agree that the variability of wind and solar poses real challenges, many say it goes too far to call the sources ‘worthless.’ Texas gets roughly one-third of its power from renewables and has kept costs low.”
“Mr. Wright’s supporters say he has helped steer the country away from what they saw as the Biden administration’s unrealistic plans to rapidly phase out fossil fuels. Some say the debate is shifting in his direction. Many states and businesses are backing off ambitious climate targets, and Democrats are less vocal nowadays about climate change. Tech companies are using more natural gas to meet exploding demand for data centers. The International Energy Agency, after some browbeating by Mr. Wright, is revising up its projections for how long fossil fuels will stick around.”
“’There’s been a real shift in how investors and others now talk about energy,’ said Travis Fisher, a director of energy and environmental studies at the libertarian Cato Institute who worked with Mr. Wright to organize the agency’s climate report. ‘Climate has become a lot less salient.’”
“Mr. Wright, for his part, says fossil fuels are too useful to recede anytime soon. ‘We will never, ever come remotely close to running out of hydrocarbons, which means you need better technology and innovations to eventually eat into their market share,’ Mr. Wright said at a Cato event in May. He said he was excited about recent breakthroughs in areas like fusion. But, he added, “the biggest innovations the rest of my lifetime in energy are almost certainly going to be in oil, gas, and coal, because they are what matter.’”
Romm-like Complaint
A comment from ‘bl in Rochester’ was featured in the Times comment section. “It’s appalling to give wright an unchallenged forum to spew out his denialist propaganda,” he began. “Covering [Chris Wright’s] speech as here, or his ‘interview’ at the climate forum, does just that.” Continuing:
He’s conducting a full out war on renewable energy sources and technology using false reasoning, no rigorous scientific argumentation, and manipulative, cherry picking economic analyses that only “answer” the irrelevant questions he chooses to ask to justify his policy choices. This is socially destructive, and will be suicidal if not stopped in the near term.
He offers no coherent reply to the increasing climate instability. He carelessly dismisses the data, and provides vapid bromides to the evident dangers with fantastical assertions while ignoring the very real costs that will be incurred. Still he remains unchallenged in public.
He chooses the present with no concern for the future. That is not leadership. It is profit protection for one energy industry.
This is doubly damaging because all sorts of roadblocks have been imposed to block renewables. He therefore condemns generations to suffer horribly from such unhinged policy insanity.
The fact that no immediate follow up rebuttal by a climatologist is allowed makes this demagoguery even more vile and sickening. Indeed his “interview” with this paper was with a journalist not a scientist, and produced a predictable, unchallenged stream of idiocy without addressing at all the reality of climate change incurred damage,
Ed Miliband, as Secretary of State for Energy Security and Net Zero in the Labour government, spoke at a Good Growth Foundation event. He praised Mariana Mazzucato (UCL professor, often called the “godmother of missions”) for shaping Labour’s approach. Miliband framed the transition away from fossil fuels as delivering both energy security and cheaper energy long-term, positioning government-led “missions” (directed investment, industrial strategy, and public direction of innovation) as the solution to climate and growth challenges.
When Ed Miliband took the podium at the Good Growth Foundation’s National Growth Debate in Westminster last week, he did not disappoint his audience of the converted. Flanked by the economist he has long revered, Miliband delivered a speech that could serve as a textbook case of what I have elsewhere called the “economic illiteracy of UK energy policy”.
Yet to dismiss it as mere stupidity would be a mistake. There is a method to Miliband’s madness—one honed over years in the cloistered halls of “woke” Oxford and the Fabian-inspired London School of Economics and now supercharged by the “mission”-obsessed theories of Professor Mariana Mazzucato of University College London.
In that speech—republished by the New Statesman—Miliband declared that “the era of fossil fuel security is over, and the era of clean energy security must come of age.” He credited “the godmother of missions, Marianna Mazzucato, who’s with us,” for the intellectual scaffolding of Labour’s clean energy push.
The mission, he said, established in opposition and now in government, has “two parts—driving to a clean electricity system but also electrifying as much as we can, as we decarbonise the wider economy.” Informed by the “lessons” of Russia’s invasion of Ukraine and the latest crisis over the closure of the Strait of Hormuz, Miliband insists Britain must “double down” on net zero, tax North Sea oil and gas investments punitively, and “electrify everything” while rejecting any new exploration and development of domestic hydrocarbons.
Pernicious Political Elite
This is not ignorance born of inexperience. Miliband has been a central figure in Britain’s—and the world’s—climate movement for nearly two decades. As Climate Change Secretary under Gordon Brown, he helped shepherd the 2008 Climate Change Act, the legislative foundation for the UK’s self-proclaimed folly of “international climate leadership”. He has since served as Shadow Secretary of State for Energy and Climate Change and, since July 2024, as the government’s Energy Security and Net Zero Secretary.
His fingerprints are on every major escalation: the legally binding net zero target by 2050, the push for “clean, homegrown” renewables, and the deliberate throttling of North Sea production through windfall taxes and regulatory hurdles. Far from a novice, Miliband is a seasoned operator who has consistently placed climate ideology above economic realism. The roots of this approach lie in his education. Miliband read Philosophy, Politics and Economics (PPE) at Corpus Christi College, Oxford, before earning an MSc in Economics at the LSE.
PPE, that notorious Oxbridge conveyor belt of generalist debaters and policy wonks, has long been criticised for producing slick operators fluent in debating abstractions and civil service procedures but often shallow on real world trade-offs and incentives. The degree is seen as a “sure ticket to the top,” having regularly produced numerous UK Prime Ministers (including Cameron, Truss, and Sunak), cabinet ministers and top civil servants.
Add the Fabian socialist ethos of the LSE—long a cradle of central planning and state-directed “progress”—and you have the perfect incubator for learned economic illiteracy. This is not a failure to learn economics; it is the active absorption of a peculiar strain of it, one in which “saving the planet” by a self-appointed expert class from the apocalypse of “global boiling” trumps every mundane consideration of reliability or opportunity cost.
Enter Mariana Mazzucato, the UCL professor whose 2021 book Mission Economy: A Moonshot Guide to Changing Capitalism has become the bible for Starmer’s five-mission Labour platform. Miliband’s praise of her as the “godmother of missions” was no throwaway line. Mazzucato’s framework—bold state “missions” to shape markets, “directionality,” “intersectoral collaboration,” and “public value”—has been adopted wholesale. Starmer’s missions on net zero, health, education, and the rest echo her call for government to move from “fixing market failures” to actively creating markets through “moonshot” ambition.
Critics of Prof. Mazzucato, including economists like Alberto Mingardi in City Journal and Michael D. Thomas in The Independent Review, refer to her work as an example of the “nirvana fallacy”: comparing imperfect real-world markets to an idealised, omniscient state free of rent-seeking, bureaucratic capture, or coordination failures. Her evidence is selective—she overstates the state’s role in innovations like the mobile phone while downplaying government waste, political short-termism, and the knowledge problem that Friedrich Hayek warned against in his critique of central planning’s “fatal conceit.”
Mazzucato’s jargon—“missions,” “moonshots,” “collective intelligence”—is not neutral rhetoric. It is the linguistic scaffolding of a worldview in which experts in white papers and government institutes know better than price signals, consumer choice, or entrepreneurial discovery. Miliband and Starmer quote her not as an economist offering testable hypotheses but as an influencer whose narrative fits the climate zeitgeist.
Since 2023, Prof. Mazzucato has served as a key technical adviser to Barbados Prime Minister Mia Mottley and co-authored with the prime minister two major reports on inclusive and sustainable development for Barbados. A central plank of the government is the Bridgetown Initiative which Mottley launched and invited Mazzucato to join as a founding member in 2022. The Initiative calls on the UN to give climate-vulnerable small island developing states (SIDS) which allegedly face existential threats from sea-level rise expanded access to loss-and-damage funding and climate finance mechanisms.
The Climate Imperative Above All
Economics is the science of ranking alternatives under scarcity, aka “opportunity costs” and trade-offs among various public policy choices by government. When climate change is elevated to existential imperative, trade-offs disappear by fiat. There is only one opportunity (“decarbonize”) and only one cost (“decarbonization”) that matters. The only permissible policies are those that accelerate decarbonisation, no matter the cost to bills, jobs, or growth. Nowhere is this clearer than in UK energy policy. Miliband insists that renewables are “homegrown” and “clean,” and “cheaper” to boot, insulating Britain from volatile global fossil fuel prices.
Yet none of these claims survive scrutiny. Solar and wind components are overwhelmingly manufactured in China, whose coal-fired power underpins the entire global supply chain from mining rare earths to refining polysilicon. The “clean energy superpower” vision depends on Beijing’s dirty energy. The UK has various “on shoring” initiatives to bring about a “manufacturing renaissance” in clean energy. Most are far-fetched to say the least (remember Boris Johnson’s boast about making the UK the “Saudi Arabia of wind energy”?) There are no UK-owned major OEM (original equipment manufacturers). Turbines are still designed and largely supplied by foreign companies (Vestas, Siemens Gamesa, GE Vernova). A “British wind turbine” from scratch would require enormous R&D, capital, and scale that doesn’t currently exist.
In any full-cycle analysis of renewable energy manufacturing, the mining and refining of minerals and rare earths required to produce components in solar, wind and battery technologies is anything but clean. And the myth of “cheap” renewables has been debunked countless times though interminable debates on system costs and intermittency keep being repeated across the energy policy literature. But the real test for all countries embarked on the Net Zero campaign remains as to how long can government subsidies for renewables on the one hand and high taxes on fossil fuels on the other, last before voters revolt over high energy bills and before the bond vigilantes come calling as the country tests its creditworthiness in international credit markets.
Meanwhile, punitive taxes on North Sea investments have accelerated decline in a sector that still provides Britain energy security and tax revenues. IEA’s Executive Director Fatih Birol — who had sounded contrite previously regarding his anti-fossil fuel posture in public meetings with US Energy Secretary Chris Wright — once again echoes Miliband. Since no new oil and gas investments are needed because demand will fall and investments will be stranded, Mr. Birol advises that the UK should forgo much of its potential North Sea expansion “despite the pressure”.
In the energy crises brought on by the Russian invasion of the Ukraine in 2022 and now in the face of the Hormuz crisis, Fatih opined in an “exclusive with the Guardian” interview:
“There will be a significant boost to renewables and nuclear power and a further shift towards a more electrified future…And this will cut into the main markets for oil…The vase is broken, the damage is done – it will be very difficult to put the pieces back together. This will have permanent consequences for the global energy markets for years to come.”
Massive government R&D spending on green innovation — as per Prof. Mazzucato’s call for “moonshot missions”—falls short when subjected to economic scrutiny. Miliband’s £22 billion bet on carbon capture and storage (CCS)—an unproven, outrageously expensive technology—exemplifies the conceit. It is the very industrial policy Mazzucato champions: government “picking winners” while socialising risks and privatising rewards for cronies.
Private firms like Google and SpaceX often lead where government lags. Government R&D subsidies invite cronyism—firms find it easier to lobby for handouts rather than compete in a competitive marketplace. Bureaucratic committees cannot replicate the dispersed knowledge of markets with skin in the game. Nuclear fusion, for instance, always remains “50 years away,” and history is littered with white elephants from state-directed innovation. Miliband’s approach reflects this planner’s hubris writ large.
Lenin’s Useful Idiots
The deeper problem is emotional, not intellectual. As one perceptive X post claims, Ed Miliband suffers from a “saviour complex”. Advisers who understand economics are sidelined because the mission is messianic: Britain must lead the world in “climate leadership,” consequences be damned. This learned illiteracy is shared across the Anglosphere’s progressive governments—from Ottawa to Canberra to Brussels. They double down on net zero dogma even as energy prices soar, industries flee, and voters revolt at the ballot box.
Mazzucato’s ideas provide the perfect intellectual cover. Her missions promise purposeful capitalism without the messy realities of perverse incentives, bureaucratic failure or unintended policy consequences. They elevate “public purpose” above profit and loss, allowing politicians to pose as visionaries while entrenching bureaucratic power and corporate welfare. In this, they serve a larger agenda: using climate as the Trojan horse for expanded state control over the economy.
Lenin famously found “useful idiots” among Western intellectuals sympathetic to the Bolshevik cause—naïve fellow travellers who lent credibility to revolutionary violence. The Greens, it seems, have found their own cadre in the Mazzucato mould: well-credentialed, jargon-fluent economists whose learned illiteracy provides intellectual respectability to policies that immiserate the working class, hobble growth, and enrich cronies.
Call them Mazzucato’s idiots. They are indispensable to the Net Zero agenda precisely because they cloak ideological zeal in the language of economic sophistication. Britain deserves better. Until policymakers rediscover the humility of classical political economy—acknowledging trade-offs, the limits of state knowledge and state action, and the superior information-processing power of competitive markets—the method to Miliband’s madness will continue to deliver higher bills, lower growth, and energy insecurity dressed up as climate virtue and moral triumph.
The mission, it turns out, is not to save the planet. It is to remake capitalism in the image of the administrative state. And the bill, as always, will be paid by ordinary Britons.
Dr Tilak K. Doshi is the Daily Sceptic‘s Energy Editor. He is an economist, a member of the CO2 Coalition and a former contributor (cancelled) to Forbes. Follow him on Substack and X.
For those who prefer reading, below is an excerpted transcript lightly edited from the interview, including my bolds and added images.
Hey everyone, it’s Andrew Klavan with this week’s interview with Bjorn Lomborg. I met Bjorn, he probably doesn’t remember this, but I met him many, many years ago at Andrew Breitbart’s house. Andrew brought Bjorn over to talk in LA, and I listened to him talking about all the simple and inexpensive things that could be done to make actual change and do actual good in terms of climate change, which I think at that point was still global warming.
And you know, we had a small audience, and I asked the question, well, if these are so such smart, cheap ideas, why don’t politicians do them? And Bjorn said, well, because that wouldn’t give them the chance to display their virtue. And I thought, here’s a man who not only knows about science, but actually knows about human nature. And I’ve been following him ever since.
He is a president of the Copenhagen Consensus Center, a visiting fellow at Stanford University’s Hoover Institution, an author of False Alarm and Best Things First, the best writer, I think, on climate issues and other issues. Bjorn, it’s good to see you.
Andrew, it’s great to be here. And I do remember that event, although I remember it for seeing the guy who played on Airplane. Sorry. So I remember that because it was it’s still one of my favorite movies. It’s one of the greatest movies ever made, I think. It really is very, very funny. Yeah.
On a totally different direction. So I was watching with great approval Donald Trump’s appearance at the United Nations. I guess it would be when we’re playing this last week. And he he had this. I’m just going to read just a little bit of the speech. He said in the 1920s and the 1930s, they said global cooling will kill the world. We have to do something.Then they said global warming will kill the world. But then it started getting cooler. So now they could just call it climate change because that way they can’t miss if it goes higher or lower, whatever the hell happens. It’s climate change. It’s the greatest con job ever perpetrated on the world, in my opinion. Do you agree with that?
So I get where he’s coming from. And I think there’s some some truth to this. I mean, Donald Trump always speaks in larger than real life words. Yes. So, it’s not a con job. There is a problem. And actually, in some sense, bizarrely, as it may sound, you know, the world is built all of our infrastructure is built to live at the temperature that we’ve had for the last hundred or two hundred years. That’s true in Los Angeles. That’s true in Boston. It’s true everywhere in the world. And so, if it gets colder or if it gets warmer, that will be a problem. So, there is an issue here.
But obviously, it’s vastly exaggerated when people then talk about the end of the world. You may remember that this was one of the favorite terms of Biden, but not just Biden, but pretty much everyone for the last four years and certainly more as well. That this is an existential crisis. There was a recent survey by the OECD, so in all rich countries in the world, where they found that percent of all peoplebelieve that unmitigated climate change, so climate change we don’t fix, will likely or very likely lead to the end of mankind. And that, of course, is a very different statement.
There is a problem, that’s true. It’s not the end of the world. But the end of the world is a great way to get funding.
And that’s why people are playing it out. But it doesn’t make for good policy. Remember, if you think the end of the world is near, you’re going to throw everything in the kitchen sink at this, which, of course, is what the campaigners would like you to do. But you will probably waste an incredible amount of resources because you’re just going to try everything.
Climate change is a problem. So I disagree with Trump there. But yes, there is an incredible amount of exaggeration. And I agree with him there. So there’s I mean, the climate changes but we’re not living in a glass bubble. And we’ve even in I don’t know, I guess it was the late 19th century, the Thames in London froze over and people went skating on it. It’s so there are these big changes and there have been ice ages, obviously. How much of this or do we know how much of this is is caused by human beings?
I have to preface this with saying I’m a social scientist, so I work a lot on the costs and the benefits of us doing policies against climate change. I’ve met with a lot of the natural scientists who study all this. Please don’t do this at home, but I’ve read the UN climate panel report, most of the pages, not all of them. And it’s incredibly boring, but it’s also very, very informative. So so I have a reasonably good take on this. And what they tell us is that the majority of the recent warming that we’ve seen is due to climate change.
I have no idea to evaluate that, no way of independently evaluating that is due to natural climate change or is manmade, due to mankind. So is it mostly due to us emitting CO from burning fossil fuels?
So there is a significant part of what’s changed over the last century or thereabouts, which is about two degrees Fahrenheit or one degree Celsius. So that’s something and that’s something we should look at. But also, we should get a sense of what’s the total impact of this. Well, actually, climate economics have spent the last three decades trying to estimate: what’s the total cost of everything that happens with climate change.
So, you know, there are lots of negatives. There’ll be more heat waves. There’ll possibly be stronger storms. There’s also going to be fewer cold waves, which is actually a good thing. There’s also going to be CO2 fertilization. So, we’ll have more greenery. You know, if you add all the negatives and all the positives, it becomes a net negative. That’s why it’s a problem. But also get a sense of this.
If you look across all of the studies that we’ve done, we estimate the net negative impact today is about 0.3% of GDP. So yeah, a problem, not the end of the world. And it’s crucial to say, if you look out till 2100 which is sort of the standard time frame, which is a long time from now, we estimate if we do nothing more about climate change, so we end up with three degrees Celsius, so about degrees 5.6 Fahrenheit, then the cost will be about to 2 to 3% of global GDP every year.
That’s certainly not nothing. That’s a lot of trillions of dollars. But again, it’s 2 to 3%. It’s not, you know, the end of mankind, It’s not anywhere near a hundred percent. And this is not me saying this. This is the guy William Nordhaus from Yale university, the only guy to get the Nobel prize in climate economics. And Richard Tol one of the most quoted climate economists in the world. They’ve done separate studies. One to find 2%, the other one to find 3%. That’s the order of magnitude we’re talking about. And just for, for added emphasis, remember by then everyone in the world will be much, much better off.
Just like if you compared people from back in 1925 and until today, the UN on its standard trajectory estimate, the average person in the world by the end of the century will be somewhere around 450% as rich as he or she is today. That’s not the US that will. And you know, people come from Denmark and other rich countries might only be 200% as rich, but many in Africa and elsewhere will be a thousand percent richer. So on average, because of climate change, it will feel like they’re only 435% as rich, which sort of emphasizes, yes, that’s a problem. I would rather have a world that’s 450% as rich trather than one that’s 435%. But it’s not the end of the world.
It’s still a fantastically much better world, just a slightly less fantastically much better world. And that less money that people will have will mean less money you have to spend, what, shoring up buildings. And so the way they measure that is actually in equivalence of how much you would need to get compensated to live with the problems.
So we don’t actually look at whether people will fix it or not. You know, it’s a bit like, if you have a slightly dangerous job, you get more money. And that’s basically a way of saying, but you’ll also have to live with that constant slightly higher risk of dying. Right. So we’re compensating you for that. That’s the, that’s the amount that we’re talking about. So it’ll feel like you’re only % as rich, although you’ll probably in reality, get all that, that slight extra money to get up to 450%, but then you will also have to live with some problems from climate change.
This week I was arguing with a socialist, lovely guy, but just the guy who believes that like all money should be redistributed. And I was pointing out that this was giving a lot of power to the people in power. And one of the things I sent him was this article you wrote in the, in the New York Post, which was exactly the kind of article that makes me angry. And I mean, it makes me frustrated with our politics. I want to read just a couple of sentences. Last year, the world spent over $2 trillion on climate policies. This is Bjorn Lomberg writing in the New York Post. By 2050 net zero carbon emissions will cost an impossible $27 trillion every year. So, this, this will choke growth, spike energy costs and hit the poor hardest and still will deliver only 17 cents back on every dollar spent. Meanwhile, mere billions of dollars could save millions of lives. I’d like to take this apart a little bit, but to begin with all the stuff that we are spending this money on, is it doing anything? Will it have any effect?
It will. I mean, what, what are we spending money on and what will it do? So, these $2 trillion, that’s sort of the official number from the International Energy Agency and many others. It’s a very soft number because obviously what goes into all this money, surprisingly, it’s also all the cost into EVs or electric cars, which of course gives you a thing that can drive you from place A to B, at least if it’s been charged. So, I mean, there are some benefits to this. It’s also spending on solar panels and wind turbines, which again, obviously gives you electricity when the sun is shining and the wind is blowing. It actually also gives you higher electricity costs all the other times, because you now need to have backup power for when it’s not shining or windy, and that capital is being used less.
So, there’s a lot of spending, it’s a very big headline number. There’s $2 trillion, everyone uses it, but it, but it’s not all that informative, because the global economy is about a hundred trillion dollars. It means we’re spending 2% on stuff that we probably wouldn’t have done had we not been scared witless on climate change. And that’s a waste. I mean, remember the total spend on healthcare is perhaps 8%. The total spend on education globally is about 5%.
These are big numbers. This is something that could have done a lot of good elsewhere. But I think the real point here is to say people want to take us to a cost that’s much, much, much higher. Remember all the world’s governments, almost all the world’s government now, not Donald Trump and the US, but most governments have pledged in one form or another that we’re going to go net zero around 2050 or shortly thereafter. But nobody looked at what the cost of this will be, which is a little surprising. Because the numbers I’m going to show you suggest that this one single promise is about a thousand times more expensive than the second costliest policy to which the world has ever committed, which was the Versailles treaty back in 1919, had Germany actually paid all the money it was supposed to. That cost was about half a trillion dollars in today’s money, which of course is why Germany never paid it. But now we’re talking about something that is going to be in the order of a thousand to two to 3000 times more costly.
Yet nobody’s looked at what the cost will be and what will be the benefits? There’s no official estimate of this.
So two years ago, a professor from Yale university, Robert Mendelsohn, gathered a lot of really smart climate economists to try to estimate what’s the cost, and what’s the benefit of net zero. A lot of those really, really smart economists ended up chickening out. You can understand why it’s a really hard question. You’re also asking what will happen in the next hundred years and you’re trying to put estimates on it. At the end of the day, they published a big study published in the journal of climate change economics, which is a period article.
And they had one benefit estimate and three cost estimates. So, this is obviously not great, but it’s the only thing the world has. And so that gives you a sense of how much this cost will and how much good will do. If you take the average of these three cost estimates, that gives you $27 trillion in cost per year throughout the 21st century. That’s where that number comes from. $27 trillion. So that’s about a quarter of global GDP right now, because we’re going to be much richer, that is only going to be about 7% of global GDP across the 21st century. But you know, that’s an enormous cost that’s on the magnitude of bigger than education, a bit smaller than healthcare and for everyone in the world, that’s a lot of money.
Now, if this gave you a lot of benefits that might be worthwhile. I mean, we pay a lot of money for stuff that’s good, but we’ve already established that even if we could entirely get rid of climate change, it would only reduce costs by two to 3%. So, spending 7% to get rid of two to 3% is a bad deal, but unfortunately net zero by 2050 means we’ll only get rid of part of it, right? Because we’ll already have cost a lot of climate change. So, the net benefit is only about 1% of GDP across the century or about four and a half trillion dollars.
So, there’s a real benefit. That’s why climate change is real. There’s a real benefit to net zero, but the benefit is much, much lower than the cost. So, $4.5 trillion in benefits, $27 trillion in cost every year in the 21st century, we’ll be paying much, much more than the benefits will generate for the world. That’s just a bad deal. There’s no other way to put it.
And the fact that we’re not honest about this and that most people just are not honest about it is one of the reasons why we’re wasting money and spending it so badly. The last bit of the quote that you just said was we could do so many other good things. Remember, most people in the world are not living in nice countries like the US or Denmark. Most people are not considering, you know, the biggest problem which of the many programs and series they want to follow are, am I going to take first or watch first? Or, you know, what kind of takeout am I going to have? They worry about their kids dying from easily curable infectious diseases, not having enough food, having terrible education, not enough jobs, corruption, all these other things. And the truth is we could solve many of these problems, not all of them, but many of them to save millions of lives at a fraction, a tiny, tiny fraction of this cost. So instead of talking trillions, we’re talking billions.
Why is it that we’re so obsessed with spending trillions to do almost no good a hundred years from now, instead of spending billions and doing a lot of good right now to avoid people dying from tuberculosis and malaria, avoid people having terrible education, getting better economies, all these things that we know work at much lower cost. That’s my central question to all these feel gooders. I mean, I know that they want to feel good about themselves, but in some sense, I would like to believe that they actually want to have done good at the end of the day.
I think it’s much more a question of saying, if I am doing effective policies, there’s not much money to hand out to friends and to buy more votes and all that kind of stuff. Whereas if I am overseeing, you know, an enormous amount of spending on stuff that doesn’t really matter. So, I can just spend it on whatever. Then clearly, I have a lot more latitude and a lot more opportunity to get people to like me and to show what a good person I am. So, I think in some sense, it’s just plain politics. You know, if you’re saying the world is on fire and you’re at risk. But vote for me and I can save your kids. And it’s only going to cost you 7%. I can see, you know, why people want to vote for that. But if you’re saying, look, things are fine and just give me a little bit of money and I’ll fix the rest of the problems. It doesn’t quite have the same ring to it, does it?
So, so if, if we were to get to net zero, wouldn’t that cripple poor countries? I mean, in other words, it seems to me that people who burn the most fossil fuels are the people who are building up most and the people who are developing most. Whereas we’re sort of, we’ve sort of leveled off, haven’t we?
Yes. So, the truth about the $27 trillion is that this is an, sort of assuming that we’re going to be smart. But I don’t know what the climate future is going to look like. I don’t think anyone really knows, but we have a good sense that we’re good at, you know, innovating stuff. And we know how to get CO2 free energy. We can do it with nuclear. We also know we can get some from solar and wind. We’ll probably have more batteries. We’ll have lots of things. I think the world was sort of, you know, stumble through and we’ll be okay. But the point is we could have been much, much better off.
Does that affect your sense of politics at all? Oh, of course it does. And I’m disappointed that half the world would tend to dismiss a lot of this because these are inconvenient facts, with that said though I also talk about all the incredibly important things we could do in the poor part of the world. This is not true for most of the world, this is a very Western, kind of rich world situation where we have this very clear distinction between right and left. And, and a lot on the left, I think have sort of gone off on the deep end on some of these things.
For instance, on climate change, which has become this identifying totem, that they worship, and not in a smart way. Remember a lot of standard left-wing belief was about helping the downtrodden, which I perfectly agree with. And I think a lot of people would agree, we need to get poor people out of poverty. That’s a terrible situation and it destroys human dignity and liberty and all kinds of things. We should absolutely do something about that. But the truth is that’s where, you know, seven eighths of the world’s population is because they know poverty and they want to get out of it.
Although when you go to these events in New York and, and elsewhere, even politicians from Africa and elsewhere, they’ll of course say all the platitudes that come along with getting some funding from rich Western nations. But in the private cocktail conversations afterwards, you know, they don’t look at Germany and the UK and say: oh yes, deindustrialization and incredibly high energy costs, that’s what we want. No, they look at China because they want to get rich like China did.
And China of course got rich famously by dramatically increasing its energy consumption through coal. At its lowest China’s energy from renewables was 7.5%, and now it’s up to about 11%. So, people think, oh China is this green giant, but no it’s not. It gets the vast majority of its energy from coal. And not surprisingly, because that has been historically the cheap opportunity to drive your economy and development.
2025 may mark the end for such policies as unsubsidized EV sales collapse and impatience with DEI rises
This year is shaping up as a turning point in restoring sanity to public policy. Nowhere is the change more evident than in attitudes to green energy policies, once the rallying cry for left-wing parties in North America. Support has collapsed for three pillars of green energy advocacy:
♦ building electric vehicles to eliminate our need for oil pipelines and refineries;
♦ using the financial clout of the Net-Zero Banking Alliance to force firms to eliminate carbon emissions; and
♦ legally mandating the shift from fossil fuels to green energy.
This turning away from green energy policies is reflected in how industrial policy underpinning electric vehicles(EV) has been discredited over the past year. Companies are delaying or abandoning the building of EV assembly and battery plants, mainly because EV sales are slumping following withdrawal of the artificial stimulus of government subsidies in both Canada and the U.S. Walking away from these investments leaves governments on the hook for billions of dollars they rashly pledged in support of EV projects.
In Quebec, Northvolt stopped work on a $7-billion battery plant,electric bus manufacturer Lion Electric filed for bankruptcy, and the Ultium CAM consortium paused plans to expand production of materials for batteries to be used in GM vehicles, which in turn led the giant mining company Vale to cancel plans for a nickel sulfate plant to supply these batteries. In Ontario, Honda delayed $15 billion of investments to build EV assembly plants and supply them with batteries, while Ford postponed its EV assembly plant plans after its EV division posted losses of $12 billion over the past two and a half years. Just last week, GM stopped producing electric delivery vans at its Ingersoll plant due to slack demand that had “nothing to do with tariffs or trade,” according to GM Canada’s president.
As investment in EV and battery plants collapses into full retreat, the outlook for fossil fuel demand improves. The International Energy Agency has reversed course and now projects demand will rise by 2.5 million barrels a day between 2024 and 2030. The under-investment in petroleum refining resulting from our having bought into the narrative that oil was past peak pushed the industry’s capacity utilization rate to 94.1 per cent in July, the highest of any industry in Canada that month. The prospect of demand exceeding capacity spurred the industry to boost investment to over $3 billion last year, double its average over the previous two decades.
The shift in public attitudes to fossil fuels provoked an abrupt about-face in Prime Minister Mark Carney’s stance on energy policy. In 2021 Carney spearheaded the launch of the Net-Zero Banking Alliance, which proposed to use access to credit to push firms to adopt policies that eliminated greenhouse gas emissions. But last month, after the world’s largest banks left it, including Canada’s,the alliance shut down. Even as it did, Carney’s government revived the Keystone XL pipeline proposal to carry Canada’s bitumen to U.S. refineries looking to replace dwindling heavy oil shipments from Mexico and Venezuela.
The tide is also turning against climate-change activists in the legal world. Just last week, a U.S. federal court ruled against claims by a group of young peoplethat the Trump administration’s gutting of green energy initiatives violated their human rights. The court concluded such an important policy issue should be resolved at the ballot box and not in the courts, a precedent we should all hope helps Ontario courts reach the same conclusion in a similar case brought by teenagers.
The setbacks for green energy policies are reflected in disarray among left-wing parties in Canada and the U.S. In the U.S., The New York Times reports, registration of Democratic voters has fallen by two million since last year’s elections, despite high disapproval of Trump’s economic policies. While the radical left rejoices in the candidacy of self-styled Democratic Socialist Zohran Mamdani for mayor of New York, more centrist Democrats, fearing his radical agenda will hurt the party in next year’s midterm elections, have been slow to endorse him. In Canada, the NDP lost official party status in this spring’s federal election as its vote share plumbed historic lows, revealing the folly of Leap manifesto leaders forcing out Thomas Mulcair as NDP leader in 2017 because they wanted more aggressive opposition to fossil fuels.
Policies such as the Green New Deal are not the left’s only vulnerability. Support for woke social movements such as DEI (“diversity, equity and inclusion”) has also become a liability. A fundamental problem associated with both the green and woke movements is that advocates are so convinced of the righteousness of their causes that they refuse to countenance debate.
Because neither developed arguments that resonated with the public, that same public is not alarmed to see these policies dismantled.
For the last few years, climate and energy policymakers have convinced themselves the world was inexorably moving away from fossil fuels.
Breaking news: it is not.
For the last few years, climate and energy policymakers have convinced themselves the world was inexorably moving away from fossil fuels.The Sydney Morning Herald has the story.
Breaking news: it is not.
The consensus was that consumption of oil, natural gas and coal would peak before the end of this decade.
There was debate about the speed of the subsequent decline, but the conclusion was the same: the end of the fossil-fuel era was within reach. But that tenet, key to achieving the ambition of net zero by 2050, wasn’t as cast in stone as its backers thought.
The annual report being prepared by International Energy Agency, which represents the views of the world’s richest nations, shows the alternative – decades more of robust fossil fuel use, with oil and gas demand growing over the next 25 years – isn’t just possible but probable. That means more carbon dioxide emissions that exacerbate the climate crisis.
It would be easy to blame the pro-fossil fuel Trump administration for the shift, but that would be a mistake: it precedes its arrival.
The idea that a peak in fossil fuel demand was approaching got significant traction in large part thanks to the IEA, whose annual World Energy Outlook tries to imagine the future via a series of scenarios. While the exercise is quite useful, it doesn’t come remotely close to making forecasts.
They are based on assumptions about economic development, population growth, political will, technological developments and prices. While not a crystal ball, the scenarios do offer important insights.
For now, the world isn’t performing an ‘energy transition’ but an ‘energy addition,’ where renewables top up oil, gas and coal.
The IEA long published a main scenario based around the policies of the day – called, unsurprisingly, “Current Policy Scenario” (CPS). The model had significant shortcomings: historically, it undercounted solar and wind power. Thus, in 2020, the IEA discontinued it, in part due to pressure from European nations and green campaigners.
CLIMATEWIRE | Artificial intelligence could cut global climate pollution by up to 5.4 billion metric tons a year over the next decade if it’s harnessed in ways that would improve transportation, energy and food production.
…
“The key will be to channel practical AI applications towards key impact areas to accelerate the market adoption rate and efficiency of low-carbon solutions,” the study said, noting that governments will have a vital role to play.
“Governments must regulate AI to minimise their environmental footprint,” the study said, pointing to the need for energy efficient AI models and the use of renewable energy to power data centers.
…
The International Energy Agency projects that by 2030 data centers will consume twice as much electricity as they do today. Growing energy demands are already challenging the U.S. grid, and oil companies are using AI to find new areas to drill. BloombergNEF has said fossil fuels will provide most of the new power for data centers over the next decade, imperiling efforts to cut carbon pollution.
Artificial Intelligence (AI) can play a powerful role in supporting climate action while boosting sustainable and inclusive economic growth. However, limited research exists on the potential influence of AI on the low-carbon transition. Here we identify five areas through which AI can help build an effective response to climate threats. We estimate the potential for greenhouse gas (GHG) emissions reductions through AI applications in three key sectors—power, food, and mobility—which collectively contribute nearly half of global emissions. This is compared with the increase in data centre-related emissions generated by all AI-related activities.Read more:
One area where the researchers believe AI can help is “nudging and behaviour change”. From the study;
Nudging and behavioural change
Changes in lifestyle and consumer behaviour can reduce 40-70% of greenhouse gas emissions by 205013. Leveraging AI towards supporting more sustainable consumption patterns is important to enable a systemic shift. In the context of increasing global resource consumption (projected to go up 60% by 206023), optimisation of production will not be enough; demand must also adapt by promoting more sustainable lifestyles, conscious consumption and reducing overall environmental impact. However, despite growing awareness and willingness to act, consumers often struggle to identify the most climate-friendly options due to information asymmetry and inefficient market signals. Personalised recommendations can empower consumers to adopt low-carbon technologies by suggesting options that align with their needs while minimising their environmental impact.
The potential for AI to overcome psychological barriers and tailor interventions is also shown by examples in specific sectors. In the power sector, energy management is a key area where AI effectively drives sustainable consumer behaviour. Google’s Nest uses sensors, smart home systems, and AI-driven learning to optimise heating and cooling based on real-time weather and user preferences24. Similarly, Oracle’s Opower combines AI with behavioural science to nudge energy savings through customer engagement25. By channelling complex data into clear, personalised recommendations, it helps to overcome cognitive limitations that hinder pro-environmental behaviour. The potential of technologies of this type is huge, as lowering thermostats by just 1 degree could save UK households £670 million annually and reduce CO2 emissions by 3.5 million tonnes26. …Read more: same study as above
This theme is reinforced in the “Modelling climate systems and policy interventions” section.
… AI models can also be applied to better design and implement policies for climate action, by generating insights and predictions around complex climate policy scenarios or monitoring the effectiveness of policy implementation. The Climate Policy Radar, for example, uses AI to create open-source tools that assist governments in designing best-practice climate policies based on evidence from thousands of case studies30. A recent study used Machine Learning to analyse roughly 1500 climate policies implemented between 1998 and 2022 across 41 countries, to identify those that were able to reduce carbon emissions most effectively31.
Furthermore, AI can also contribute to developing new economic models that include “Beyond GDP” metrics (for a comprehensive review see Jansen et al.32). Policymaking has long focused on economic growth as measured by gross domestic product (GDP), diverting attention from other societal goals, such as sustainability, personal well-being and equality. Thanks to the ability of processing large and diverse types of datasets and running complex modelling tools, AI can help integrate “Beyond GDP” metrics into current macro-economic models. This could facilitate policymakers in making informed decisions that are directed towards shaping a sustainable and inclusive future. …Read more: same study as above
To be fair, the examples the researchers gave were positive, about Winnow Vision’s cameras helping commercial chefs to increase profits by reducing waste, and helping commuters find better routes to their destinations.
AI has the potential to help as much as it hinders regard to personal freedom – AI powered research tools could penetrate the fog of lies and help provide access to reliable information. This freedom AI concept at least has the potential to preserve the current status quo, if not improve consumer knowledge.
Of course, the central premise of the study, that AI has the potential to reduce emissions, seems utterly nonsensical given all the power plants which are springing up in response to the AI boom. If AI was reducing emissions, why would we need all the new power plants? Let me know when the power plant boom starts fizzling out, and we can re-evaluate whether AI is reducing the need for energy consumption faster than new AI data warehouses drive up demand for power.
The G-7 countries are meeting this week in Kananaskis in Alberta, Canada. This G-7 meeting will focus on geopolitical issues. While many disagreements currently prevail among the G-7 countries, all likely agree that African countries deserve a shot at pulling themselves up out of poverty. Africa is the only continent in the world where the population’s electricity access is declining, and poverty is growing. Not only is electricity access in Africa waning, but the G-7 supported policies have led to a new phenomenon—wide-spread establishment of unreliable electricity.
The G-7 countries are meeting this week in Kananaskis in Alberta, Canada. This G-7 meeting will focus on geopolitical issues. While many disagreements currently prevail among the G-7 countries, all likely agree that African countries deserve a shot at pulling themselves up out of poverty. Africa is the only continent in the world where the population’s electricity access is declining, and poverty is growing. Not only is electricity access in Africa waning, but the G-7 supported policies have led to a new phenomenon—wide-spread establishment of unreliable electricity. To avoid consumption of fossil fuels, the G-7 and its supported institutions such as the World Bank have been promoting off-grid solar, and renewable expansion in Africa without expanding baseload power sources such as fossil fuels or nuclear energy. Sporadic electricity can power a lamp or charge a phone, but not industry, water pumps and refrigeration, which are necessary for poverty reduction. It is time for the G-7 to end its embargo on Africa’s access to reliable electricity and remove the World Bank’s limitations on financing fossil fuels production and electricity generation. Africans deserve real electricity.
The G-7 2021 decision to stop financing fossil fuel production and electricity generation was based on the idea that if there is limited access to fossil fuels, people will turn to solar, wind and hydropower. However, in reality, without access to affordable and reliable fossil fuel power plants, most in Africa continue to burn dung and other biomass for energy, rather than consuming more renewable energy. And this increased use of traditional biomass generates greater pollution and emissions and harms health more than fossil alternatives, such as natural gas.
Following the G-7 decision, the World Bank prioritized lowering emissions over poverty reduction in Africa, in defiance of its defined mission. The International Energy Agency also abandoned its mission of energy security and took up climate policy in its place. The organizations recommend more expensive and less reliable renewable energy for Africa, and don’t even suggest fossil fuel options, even though these could more readily power African development and help Africa rise from poverty. Moreover, restricting loans and capital to renewable energy leaves Africans with more expensive power. This does not seem like the right policy for the world’s poorest.
About a quarter of the new electricity access in sub-Saharan Africa in recent years is from off-grid solar energy. Thus, many of the new electricity users do not have full electricity access. In Africa, the World Bank no longer promotes policies for provision of baseload power in electricity supply, in order to avoid admitting that Africa needs fossil fuels. There is no large-scale stable electricity without baseload power.
Global climate policies to restrict public funding and capital for investments in natural gas projects have disproportionately hurt Africa. High-income countries don’t need public funding for energy development, unlike most African states. Private capital markets also reduced investments in recent years in fossil fuel production despite market demand. This drove-up energy prices, pushing energy access out of reach for many Africans and leaving many new gas discoveries in Africa, untapped.
The U.S., Canada and other main donors should not allow the World Bank, International Energy Agency and other entities they fund to count partial electricity access as full electricity access. If a village gets a solar energy unit that provides a few hours a day of power, this does not power machinery and stable supplies for refrigeration and water pumps. As a result, this electricity access is highly limited in its ability to spur economic growth, and it is incorrect to describe these villagers as having real access to electricity. Data on electricity access in U. S. government, IEA, World Bank, and UN reports should be categorized as reliable or not. Africans receiving a few hours a day of unreliable power should not be counted as achieving full electricity access.
It is time to flip the high moral position. Those that aspire to net-zero are condemning Africa to extreme poverty. Those that promote African access to fossil fuels, want Africans to have the chance to rise up.
Prof. Brenda Shaffer is an energy expert at the U.S. Naval Post-graduate School. @ProfBShaffer
This article was originally published by RealClearEnergy and made available via RealClearWire.
The climate movement’s annual showpiece, the United Nation’s Conference of Parties (COP), held this year in Baku, Azerbaijan, has been exposed to an unprecedented level of disinterest – even dissent – from developing nations.
The climate movement’s annual showpiece, the United Nation’s Conference of Parties (COP), held this year in Baku, Azerbaijan, has been exposed to an unprecedented level of disinterest – even dissent – from developing nations.
Leaders of some of the world’s most resource-rich, economically aspiring countries have opted to sit this one out, sending only low-level delegates, if any. This is the latest signal of a growing resistance to an anti-fossil fuel “gospel” advanced by the United Nations.
Last year’s COP28 in the Middle East, where oil wealth underpins entire economies, forced the climate community to confront its contradictions. Today, COP29 in central Asia continues this reckoning and presages the demise of an unscientific and anti-developmental policy framework wrecking global economies.
Host of COP29 Educates Climate Woke Delegates
The tone of COP29 itself is a marked departure from prior gatherings. In Azerbaijan, where oil and gas production are integral to the national economy, the summit’s host, Azerbaijani President Ilham Aliyev, called fossil fuels “a gift from God,” lauding their contribution to global prosperity and stability.
Fossil fuels have moved from being a taboo “elephant in the room” to a subject of open discussion at COPs. The leaders of countries in Africa and Latin America are freely questioning the premise of banning their use of fossil fuels while much of the developed world continues to consume record amounts of coal, oil and natural gas. The notion that high-income nations can dictate the energy agenda is seen as a remnant of a power structure that primarily serves the interests of the world’s most privileged.
The International Energy Agency projects that developing countries will see substantial growth in energy demand over the next decade, an expansion that cannot be met by renewables. Leaders in these regions understand that hydrocarbons are critical to achieving their development goals.
Unprecedented Pullout from COP Conference and Resistance from Global South
In a surprising move, Argentina’s newly elected president, Javier Gerardo Milei, withdrew his country’s 80-person delegation from Baku less than a third of the way into this year’s 11-day COP. He cited the need for pragmatic energy policies that encourage development rather than stymie it.
For Milei, whose presidential campaign was based on a pro-business, anti-bureaucracy platform, the message is clear: Policy must serve the economic needs of his country first. Argentina’s ongoing energy crisis, its untapped shale gas reserves and a crippling economic situation demand a level-headed approach that prioritizes national interests over global climate ideals that are both batty and corrupt.
Milei’s political philosophy resonates with a growing number of leaders in the Global South who view economic growth as paramount and recognize that access to energy is fundamental to achieving it.
Argentina’s departure from COP29 is a turning point that should serve as a wake-up call to the U.N. and its allies. The time for one-size-fits-all mandates is over. The rigid orthodoxy of fossil fuel divestment pushed by the U.N. and wealthy nations is losing ground, challenged by leaders who refuse to sacrifice their national interests to a destructive agenda.
For much of the Global South, the idea of an immediate energy transition remains, at best, aspirational and, at worst, profoundly out of touch. The reality is that fossil fuels still power 80% of global energy consumption. This isn’t just an inconvenient truth; it’s an inescapable basis of modern civilization that developing nations understand viscerally.
As the COP29 circus concludes in Baku, the world is seeing the crumbling of the long-held illusion that a global transition to green energyis feasible, much less fair and desirable. Developing nations are proclaiming that they will not be deprived of necessary energy sources by nations that continue to feast on the very fossil fuels they frown upon. The disconnect between rhetoric and reality is stark, and developing countries are calling attention to it.
Fossil fuels are not a relic of the past; for many countries, they are the key to a prosperous future – truly “a gift from God.”
Vijay Jayaraj is a Science and Research Associate at the CO2 Coalition, Arlington, Virginia. He holds an M.S. in environmental sciences from the University of East Anglia and a postgraduate degree in energy management from Robert Gordon University, both in the U.K., and abachelor’s in engineering from Anna University, India.
This article was originally published by RealClearEnergy and made available via RealClearWire.
The Penrose report sadly has missed a big opportunity to highlight to the public the obscene costs they are already incurring for Net Zero, and to propose radical changes while we still have a chance to pursue them.
The CPS is well known for challenging the left wing consensus, so it is doubly disappointing to see this report by John Penrose:
Press Release
As new government data shows that the UK has the most expensive industrial electricity prices in the world, four times those in the US and 46% above the International Energy Agency median, a new CPS report by John Penrose sets out how the UK can reduce the cost of its energy and find a cheaper route to Net Zero:
Despite international gas prices coming back down in the aftermath of Russia’s invasion of Ukraine, British households are still struggling with high energy bills because of outdated regulations pushing up costs.
‘A Cheaper Route to Net Zero’ by John Penrose, former Conservative MP and minister, Competition Tsar, leading an independent review of UK competition policy, and co-chair of the Commission for Carbon Competitiveness’ argues that the current system is hostage to the volatile international price of gas, to our detriment, and that regulations dictating how energy firms should behave have become steadily more complicated, detailed, expensive and slow – adding to the cost of energy.
The paper sets out twenty recommendations which could be adopted by the new government to help bring energy bills down while still committing to decarbonisation.
The recommendations are broadly summarised as:
uncoupling energy bills from the price of gas
addressing the intermittency of renewable energy in the most cost-effective way
slashing the cost of energy transmission with measures like ‘local discounting’ for customers who agree to pylons or onshore wind turbines being built near them
cutting red tape and strengthening Ofgem’s commitment to competition
reforming the Energy Price Cap
levelling the playing field for UK manufacturers, including through the introduction of a Carbon Border Adjustment Mechanism (CBAM)
Penrose long ago signed up to the Net Zero dogma, so is surely the wrong person to write a report on how to cut Net Zero costs.
This new report ignores the elephant in the room. It is Net Zero policy which is responsible for high electricity prices. Fiddling around at the edges, as Penrose suggests, will not alter that fact.
Direct subsidies for renewables, along with the cost of standby capacity already cost £11.5 billion a year. Add on grid balancing costs, carbon tax and FITs, and this swells to at least £15 billion.
This is equivalent to £50/MWh, a fifth of retail prices.
To that can be added the £100 billion of grid upgrades planned over the next ten years, necessitated entirely by Net Zero considerations.
Penrose makes a big play of the fact that power prices have not fallen as sharply as gas prices since the peaks in 2022. He claims that this is the fault of our market system.
But the main factor has been the steady increase in renewable subsidies. Since 2019, these have risen by £3.6 billion, and will continue to rise in years to come.
There are other reasons why we have not seen the full effect of reduced gas prices in our bills.
Firstly the cost of gas power is artificially raised by carbon taxes. Secondly CCGT plants cannot run efficiently due to the intermittency imposed by wind and solar power, which effectively have priority access to the grid. If we used CCGT as a first resort, rather than a last, its cost would be much lower.
There is also the issue of coal to consider. Most EU countries still use plenty of coal for electricity generation – last year it accounted for 12%. This has helped to keep costs down at a time when gas is still dearer than it was before the Ukraine war.
Another factor is the mix of forward and spot buying on the market. The introduction of wind and solar power has led to the spot market being of much greater importance. This has brought much greater price volatility, and arguably higher prices overall. In an ideal world, electricity suppliers would source most of their power on the forward market, which CCGTs could provide at much lower prices as a result.
Perhaps the most ridiculous recommendation is the introduction of a Carbon Border Adjustment Mechanism, ie an import tariff on Chinese wind turbines and solar panels. The idea the UK manufacturers could make them as cheap as China does is absurd. The end result would be higher electricity prices.
If Penrose is serious about cutting electricity bills, there are things that could be done straightaway, for instance:
Cutting carbon prices to zero – this would immediately reduce the cost of gas power, thus having an effect on wholesale prices which tend to be set by the price of gas.
Cutting Renewable Obligation prices
Cancelling all future CfD auctions – if renewables really are as cheap as claimed, they should be able to compete in the market without govt support.
The Penrose report sadly has missed a big opportunity to highlight to the public the obscene costs they are already incurring for Net Zero, and to propose radical changes while we still have a chance to pursue them. Worst of all, they have not told the public how much higher their bills will go in future to meet Miliband’s mad agenda.
When people get into advocating for this “energy transition,” the stars regularly align to bring forth the most extreme levels of ineptitude. Start with the fact that the “smartest” people are filled with arrogance and hubris, but are not actually very smart.
In my self-designated role critiquing various schemes for total transformation of the world energy system, I get to review large amounts of poor, shoddy, and incompetent work. When people get into advocating for this “energy transition,” the stars regularly align to bring forth the most extreme levels of ineptitude. Start with the fact that the “smartest” people are filled with arrogance and hubris, but are not actually very smart. Add that many innumerate Politics and English majors have flooded into a field that cries out for engineering calculations. Add too that groupthink and orthodoxy enforcement prevent anyone from pointing out obvious flaws. And then throw in a strong dose of religious zealotry that obstructs the intrusion of anything resembling critical thinking. All in all, it’s a prescription for catastrophe.
But in a field rife with bad, worse, still worse, and even dangerously incompetent work, I don’t know if I’ve ever seen anything as shockingly inept as the Report just out from the International Energy Agency with the title “Batteries and Secure Energy Transitions.” The Report has a date only specified to the month of “April 2024,” but the press release came out just two days ago on April 25.
If I had been given the assignment by the North Koreans to write the Report to somehow induce the West to self-destruct, I don’t know how I would have done it differently.
Are you familiar with the International Energy Agency? It is not part of the UN, but rather a separate consortium currently of some 40+ countries, mostly Western and mostly rich, founded in the wake of the oil shocks of the 1970s with a then-goal of promoting energy security. It is based, of course, in Paris. The current (and since 2015) head is a guy named Fatih Barol. Here is a picture of Barol from Wikipedia:
Somewhere along the line the IEA completely lost track of the energy security mission, and turned into an unabashed advocate for the green energy transition. That’s where they are today.
I don’t know how many people work at the IEA, but it seems like most to all of them got in on writing this Report. On page 5 there is a list of some 35 “directors,” “lead authors,” and “principal authors” from among IEA employees, plus another 4 who provided “support,” and then, on pages 6 to 8, some 89 people said to be “high-level government representatives and international experts from outside of the IEA” who somehow “contributed to the process.” From the content of the Report, one has to wonder if any of these people ever completed the study of arithmetic at the sixth-grade level, let alone if any have read any of the important work in this area.
The thesis of the Report is that batteries, and particularly lithium ion batteries, are the key to the impending energy transition, and need to be scaled up massively and immediately with whatever amount of government subsidies and handouts that it takes. Here are a few quotes from the press release:
After their deployment in the power sector more than doubled last year, batteries need to lead a sixfold increase in global energy storage to enable the world to meet 2030 targets. . . . In the first comprehensive analysis of the entire battery ecosystem, the IEA’s Special Report on Batteries and Secure Energy Transitions sets out the role that batteries can play alongside renewables as a competitive, secure and sustainable alternative to electricity generation from fossil fuels. . . . IEA Executive DirectorFatih Birol [said,] “Batteries will provide the foundations in both areas, playing an invaluable role in scaling up renewables and electrifying transport while delivering secure and sustainable energy for businesses and households.
I suppose it would be too much for me to expect these grandees to have read my energy storage report, published by the Global Warming Policy Foundation in December 2022. But if you are claiming that you have at hand a “competitive, secure and sustainable alternative to electricity generation from fossil fuels,” as these guys are, there is a series of very obvious question that must be addressed. Those include:
Quantitatively, how much energy storage, in watt-hours (or gigawatt-hours)will be necessary to provide full back-up to a national electricity grid once all fossil fuel back-up has been banished and the storage is all that is available when the instantaneous generators are not supplying the full demand?
How much will that amount of storage cost?
What is the maximum length of time that energy must be held in storage before it is called upon, and is the proposed storage technology capable of the task of storing energy for that period of time?
There are other comparably important questions, but at least those are absolutely essential.
The IEA Report addresses none of them.
What we get instead is endless happy talk about the wonders of lithium ion battery technology, how the costs are falling rapidly, how deployments are soaring, and how utopia (i.e., meeting UN COP 28 emissions reduction targets) is right around the corner if only we accelerate the process with massive government “support.” The full Report is some 159 pages (with appendices and references), so I can only give you a small sample. But here are a few choice quotes from the Executive Summary:
From page 11: “Batteries are an essential part of the global energy system today and the fastest growing energy technology on the market. Battery storage in the power sector was the fastest growing energy technology in 2023 that was commercially available, with deployment more than doubling year-on-year.”
Also from page 11: “Lithium-ion batteries dominate battery use due to recent cost reductions and performance improvements. Lithium-ion batteries have outclassed alternatives over the last decade, thanks to 90% cost reductions since 2010, higher energy densities and longer lifetimes.”
From page 12: “Policy support has given a boost for batteries deployment in many markets but the supply chain for batteries is very concentrated. Strong government support for the rollout of EVs and incentives for battery storage are expanding markets for batteries around the world.” [For the obtuse among the readership, “policy support” is code for vast subsidies and handouts.]
More from page 12: “Batteries are key to the transition away from fossil fuels and accelerate the pace of energy efficiency through electrification and greater use of renewables in power.”
Still on page 12: “To triple global renewable energy capacity by 2030 while maintaining electricity security, energy storage needs to increase six-times. To facilitate the rapid uptake of new solar PV and wind, global energy storage capacity increases to 1 500 GW by 2030 in the NZE Scenario, which meets the Paris Agreement target of limiting global average temperature increases to 1.5°C or less in 2100. Battery storage delivers 90% of that growth, rising 14-fold to 1200 GW by 2030.”
Check out that last bullet point. Yes, they are so dumb that they discuss energy storage capacity in GW rather than GWh. How did they come up with the line that to reach their goals “energy storage needs to increase six-times” when they don’t even know the right units to do the calculations? You won’t find an answer in this Report. In my own energy storage report, I calculated that to reach a zero-emissions electricity sector that could get through a year without fossil fuel back-up would require increasing energy storage by something around 10,000 times. I used the correct units and showed how my calculations were done.
And how about the question of the length of time that energy must remain in storage to back-up a wind/solar powered grid, and whether the proposed technology is up to the task? In my own report, which only considered scenarios of getting through a single year, I showed that much of the stored energy would need to be held for 6 – 12 months before use. In a further blog post on September 28, 2023, I covered a new report then out from the UK’s Royal Society (described by me as “semi-competent”), which used 37 years of data. Based on the 37 years of data, that report concluded that hundreds of hours worth of grid peak usage would need to be held in storage for multiple decades in order to get through worst-case sun and wind droughts. I had this quote from the Executive Summary of the Royal Society report:
Wind supply can vary over time scales of decades and tens of TWhs of very long-duration storage will be needed. The scale is over 1000 times that currently provided by pumped hydro in the UK, and far more than could conceivably be provided by conventional batteries.
(Emphasis mine.). I’m ready to forgive these IEA guys for not being familiar with my own report, but not for complete ignorance of the Royal Society’s effort.
The entire discussion that I can find in the IEA Report on the problem of need for massive amounts of very long duration storage consists of a chart and one paragraph of text on page 47. Here is the chart:
And the text:
Iron air and other battery technologies that potentially could enable the storage of electricity over longer durations measured in weeks, are still in their infancy. Currently it is not clear whether those technologies can be developed so as to provide what is required in a cost-efficient way. For even longer duration storage, such as seasonal storage, battery technologies are not fit for purpose, and other mechanical, e.g. pumped storage hydro, and chemical, e.g. hydrogen storage, technologies need to be deployed.
So 90 plus percent of the storage needed to back up the intermittently-supplied grid needs to be stored for months and years, but the only battery technologies that can even last for “weeks” are things that are “in their infancy” and where it is “not clear” that they can be provided in a “cost-efficient way.”
Overall, a shockingly inept and embarrassing piece of work from the IEA. Undoubtedly our government will react by piling forth a few more hundreds of billions of dollars to subsidize batteries to do a job for which they are completely “unsuitable.”
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