No, the energy crisis is not an unforeseen consequence of the Ukrainian war. It is the result of years of wishful thinking, smoothing and short-term thinking. We are on 300 years of coal stock. We have captured large amounts of gas in rocks below Central Scotland, Yorkshire, Lancashire and Sussex. We have as much a claim as any other country that we invented civilian nuclear power. Yet, unbelievably, we are faced with power outages and energy rationing.
The disaster we face this winter represents a failed policy under successive governments stretching back decades. The fact that much of Europe is in the same boat – and that poor Germany is barely in it, but clinging to the gunwales with its fingertips – is no consolation.
Like their counterparts in other Western countries, our leaders are now struggling to make up for past mistakes. More nuclear power plants are being proposed. The ban on shale gas extraction is under review. Suddenly, attention is being paid to possible new sources of clean fuel, from hydrogen to fusion. All good things. All too late.
You cannot build a nuclear power plant in less than five years. Even fracking takes about ten months to get online — and that’s assuming you’ve cleared all the planning hurdles first. Hydrogen has enormous potential, and what Britain is doing with fusion, not least at the Atomic Energy Authority’s facility in Culham, is astonishing. We may not be twenty years away from solving all our energy problems. But none of that will help us this coming winter, when the average household fuel bill will soar to over £4,000.
How did we allow ourselves to become so vulnerable? It was hardly as if disruption to global energy markets was unthinkable. Most of the world’s hydrocarbons are buried under countries with vile governments. For every Alberta, there are a dozen Irans; for every Norway, a dozen Nigerians. There is even a theory, first put forth by Juan Pablo Pérez Alfonzo, the Venezuelan energy minister who founded OPEC, that the mere fact of oil turns a country into a dysfunctional dictatorship.
We have seen wars, blockades and revolutions in the petro-dollar economies. We knew that a supply interruption was always possible. And it wasn’t as if Vladimir Putin was hiding the nature of his regime for heaven’s sake.
No, we are in this mess because for most of the twenty-first century we have ignored economic realities in pursuit of theatrical decarbonization. Actually, no, that underestimates our folly. Decarbonization will eventually take place as alternative energy sources become cheaper than fossil fuels. It is appropriate that governments strive to accelerate that process. But that goes much further than emitting less CO2. Our intellectual and cultural leaders – TV producers, novelists, bishops, the masses – see fuel consumption itself as a problem. What they want is not green growth, but less growth.
As Amory Lovins, arguably the foremost writer involved in the abolition of fossil fuels, put it in 1970:
“If you ask me, it would be almost disastrous for us to discover a source of clean, cheap and abundant energy because of what we would do with it.”
The idea that cheaper energy is a positive good – that it reduces poverty and gives people more free time – has been almost completely lost. We have convinced ourselves that if it doesn’t hurt, it doesn’t work. The reason we talk so easily about bans and rationing isn’t just that the lockdown has made us more willing to boss around. It is that we have come to regard the use of power as a sinful indulgence.
But raising the energy price cannot be done alone. When electricity gets more expensive, everything else gets more expensive too. Fuel is not just one of many raw materials; it is the engine of exchange, the engine of efficiency, the vector of economic growth.
When was the last time you heard a politician admit that? When did you hear a public figure glorify cheap energy as a means of poverty alleviation? When have you heard a historian describe how coal and later oil liberated the masses of humanity from the grueling grind and led to the abolition of slavery? For ten thousand years, the primary source of energy was human muscle, and emperors on every continent found ways to exploit and exploit their fellow humans. But why bother with slaves when you can use a barrel of sticky black stuff to do the work of a hundred men—without needing to be fed or housed?
The reason no one says these things (except Matt Ridley) is, to be blunt, that it’s out of fashion. The high-status stance is that we are brutalizing Gaia, that politicians are in hockey for Big Oil, and that we should all learn to get by on less — a stance that’s especially easy to take if you spend the shutdown on it. pay to stay in your yard and don’t feel like commuting again.
Extinction Rebellion, Insulate Britain and various anti-capitalist frondists are openly and shamelessly against growth. For them, cheap energy has dragged humanity away from the closed, local economies they want. As Paul Ehrlich, the father of modern green, put it in 1975:
“Giving society cheap, abundant energy right now would be the moral equivalent of giving an idiot kid a machine gun. With cheap, abundant energy, an effort would clearly be made to pave, develop, industrialize and exploit every last bit of the planet.
The Tories don’t say it that way, of course, not even to themselves. But they are still swept up by the cultural currents of the day. So they find ways to rationalize higher taxes, higher spending and anti-market measures that would normally allow them to have few trucks.
Usually they do this by exploiting the economic opportunities that green technology will supposedly bring. Boris Johnson praises them with such enthusiasm that he seems to have genuinely convinced himself. But it’s pure nonsense. If there really were such opportunities, investors would find them without the state having to ban some fuel sources and subsidize others.
Green growth is a misconception for the same reason that, as Frédéric Bastiat showed in 1850, you cannot make a city richer by stocking up shop windows. That could generate immediate growth – nominal GDP often rises sharply in the wake of a natural disaster – but every cent the retailer spends on new windows (and the glazier who now has extra income, and by the people he buys from, etc.) .on) is a penny that would have been more usefully spent without the fractions. Likewise, every penny spent on green “investments” is a penny taken out of the productive economy through taxes.
All this is not to say that governments should not try to mitigate climate change. They should. I wish they would admit it is expensive. Green jobs are a cost, not a benefit. If you banned the use of excavators and instead had rows of workers with shovels, you could claim that you had “created” jobs; but you would have made everyone worse off.
Conservatives should not approach climate change in a masochistic or messianic spirit, but calmly, transactionally, and stubbornly. If there are good reasons to believe that technological progress will lead to significantly lower costs, then shift the timetable accordingly. Similarly, if something more urgent comes along, make a cool assessment of where your priorities lie. When the coronavirus hit, several fiscal targets were abandoned as there was talk of a more immediate crisis. The current energy shortage should prompt a similar reassessment.
Consider this. The transition from relatively dirty coal to relatively clean gas required little government intervention. The Thatcher government simply withdrew subsidies and let the market do its work. CO2 emissions fell and the air became cleaner.
Since then, however, we have taken a much more interventionist approach, with price caps and green taxes and subsidies for consumers and subsidies for producers and a ban on new technologies (particularly fracking). Result? Prices have risen and supply has fallen – to the point where, like a South American dictatorship, we are about to command our populations to get by on less.
Please ministers, stop trying to help. Stop spending and taxing and printing. Stop fines and subsidize and cap. Stop banning and rationing. Stop setting goals. We’ve had enough of being helped. We need time to heal.