July 31, 2023 - 3:00pm
Rishi Sunak’s government appears to be jettisoning much of its green agenda. Whitehall has just announced that the UK’s carbon trading scheme is to issue more allowances than expected. While this may seem like a boring technocratic detail, it has had profound consequences. Since April, the price of UK carbon emissions has fallen around 40% relative to Europe.
Britain’s emissions are currently ruled over by the UK Emissions Trading Scheme, which was launched in 2021 following Brexit. It is a standard cap-and-trade scheme that puts a price on the emission of carbon, with this price effectively controlled by the Government issuance of allowances. The extra allowances issued recently would allow an extra 53.5 million tonnes of carbon to be issued between 2024 and 2027, or about half a year’s worth of the UK’s total emissions.
At the same time as the Government moved to lower the price significantly on carbon emissions, the Prime Minister has made a trip to Scotland where he’s announced plans for more oil and gas drilling in the North Sea. Sunak said that the Government aims to “max out” energy opportunities in the region.
This U-turn has partly come about thanks to the surprise victory achieved by the Conservatives in the Uxbridge and South Ruislip by-election, widely seen to have come about because of London Mayor Sadiq Khan’s imposition of Ulez charges on motorists. But this is not the only force driving the Tories.
Behind the scenes, the green agenda has been taking a beating for some time. At the end of June the CEO of Blackrock, Larry Fink, announced that the firm would no longer be using the term “ESG”. Blackrock is not just the world’s largest asset management firm, but also a pioneer in the widespread use of the ESG framework. While Fink claimed that the firm was dropping the term because it had become politicised, it is an open secret in finance that ESG investing has turned out to be a farce and has not delivered the returns that advocates promised.
The energy shortages caused by the war in Ukraine and the sanctions on Russia have been a splash of cold water in the face of policymakers. Prior to the war, Europeans could aim to build out large amounts of renewable capacity in their energy grids, safe in the knowledge that Russian piped gas was constantly looming in the background to fill the inevitable gaps this strategy created. Now, with energy prices high and Europe’s industry under threat of deindustrialisation, policymakers are having to face the potential costs of green policies pursued in lieu of cheap Russian gas.
Does this mean we’ve seen the last of green? Hardly. It’s more likely that we see the issue become sharply politicised, with pro-greeners and anti-greeners digging in to defend their policies. Indeed, Labour is already chastising the Tories for backtracking on their green commitments.
There is every chance that the green debate will plug the gap in the political market left by Brexit, with those who waved EU flags seven years ago doubling down on their commitment to climate policies and those who waved Union Jacks highlighting the costs of high energy prices. This would be a godsend to the Conservative Party, which has found it hard to shore up support as the political momentum generated by Brexit has fallen away. Resorting to fighting pitched political battles in order to determine what the country should do with its energy strategy might be depressing, but that’s the position the Conservatives find themselves in.
Philip Pilkington is a macroeconomist and investment professional, and the author of The Reformation in Economics
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SubscribeSome pragmatic realism in this debate is welcome.
I am fully on board with humanity (and primarily the industrliased nations) not doing enough to protect the planet. I have bored people with food miles, peak oil, recycle/reuse, don’t ship tat across the world to go to landfill, the disingeniuty of outsourcing our carbon emissions to Chine (et al) etc etc.
BUT; I am absolutely not on board with the green washing and the virtue signaling of the well off on all this. EV’s, air source heat pumps, solar etc – great for the wealthy, not so good for those on an average and below average wage. Not so good for huge swathes of the world more interested in food on the table than what Saint Greta says.
We can look after the planet without crippling ourselves financially and without pushing even more of the worlds poorest into destitution.
who wants to live on a planet ruled by eco fascists? not me…
“..it is an open secret in finance that ESG investing has turned out to be a farce and has not delivered the returns that advocates promised.”
Who would have guessed ? Worrying that those in charge seem so susceptible to snake oil salesmen.
I have some magic beans is anyone is interested
who wants to live on a planet ruled by eco fascists? not me…
“..it is an open secret in finance that ESG investing has turned out to be a farce and has not delivered the returns that advocates promised.”
Who would have guessed ? Worrying that those in charge seem so susceptible to snake oil salesmen.
I have some magic beans is anyone is interested
Some pragmatic realism in this debate is welcome.
I am fully on board with humanity (and primarily the industrliased nations) not doing enough to protect the planet. I have bored people with food miles, peak oil, recycle/reuse, don’t ship tat across the world to go to landfill, the disingeniuty of outsourcing our carbon emissions to Chine (et al) etc etc.
BUT; I am absolutely not on board with the green washing and the virtue signaling of the well off on all this. EV’s, air source heat pumps, solar etc – great for the wealthy, not so good for those on an average and below average wage. Not so good for huge swathes of the world more interested in food on the table than what Saint Greta says.
We can look after the planet without crippling ourselves financially and without pushing even more of the worlds poorest into destitution.
Net zero will never happen. Period. It will make people much poorer – not exactly a vote winner. The only question is how far each govt and party is willing to travel down that road before reality kicks them in the teeth.
Russian gas won’t make it better either. It may keep energy costs slightly lower in the short term, but energy costs will still become an economic anchor as more wind and solar enter the market.
It’s mandatory. Get used to it.
You don’t understand the ways of the world. Mandatory suddenly becomes very unmandatory when the sh!t hits the fan.
You’re right about that, to a point. However, no one is going to stand up in Parliament and advocate reversing Net Zero policy. They agreed it after all.
No they didn’t. It was slipped through at the end of May’s disastrous period in office and it was not voted for in parliament. This will become an issue as the battle heats up.
We will be amazed at the number of MPs who will suddenly deny that they ever supported the government’s Net Zero stance – They were misquoted. Eventually we will reach the stage where, apparently, no politician approved of it, and we will be left scratching our heads trying to figure out how, in that case, it became government policy in the first place.
What battle?
I will answer that:
The battle between fantasy and reality.
On that we can definitely agree ;o)
Imposing Net Zero on the UK will not solve the world climate crisis, because the UK is not contributing to it in any significant way. Those countries that are responsible for the vast majority of emissions are not going to change their ways to indulge you. They will merely smile at you and carry on as normal – You do not have the power to force them to comply with a policy that they regard as economically and politically suicidal.
China, India, Africa and Asia watch the West demanding action and continue on with more coal and fossil fuels…they’d happily take a few trillion if we want to send it to them
It’s worth noting that one of the reasons the UK and other countries have lower emissions is because they import everything from China, so our CO2 production has effectively been moved to them.
I know. Wonderful isn’t it?
I know. Wonderful isn’t it?
China, India, Africa and Asia watch the West demanding action and continue on with more coal and fossil fuels…they’d happily take a few trillion if we want to send it to them
It’s worth noting that one of the reasons the UK and other countries have lower emissions is because they import everything from China, so our CO2 production has effectively been moved to them.
Imposing Net Zero on the UK will not solve the world climate crisis, because the UK is not contributing to it in any significant way. Those countries that are responsible for the vast majority of emissions are not going to change their ways to indulge you. They will merely smile at you and carry on as normal – You do not have the power to force them to comply with a policy that they regard as economically and politically suicidal.
Indeed, which normally happens around election time!
On that we can definitely agree ;o)
Indeed, which normally happens around election time!
I will answer that:
The battle between fantasy and reality.
We will be amazed at the number of MPs who will suddenly deny that they ever supported the government’s Net Zero stance – They were misquoted. Eventually we will reach the stage where, apparently, no politician approved of it, and we will be left scratching our heads trying to figure out how, in that case, it became government policy in the first place.
What battle?
The general population didn’t agree to it, it was never discussed let alone costed.
No they didn’t. It was slipped through at the end of May’s disastrous period in office and it was not voted for in parliament. This will become an issue as the battle heats up.
The general population didn’t agree to it, it was never discussed let alone costed.
You’re right about that, to a point. However, no one is going to stand up in Parliament and advocate reversing Net Zero policy. They agreed it after all.
It can and will be reversed. The only question is timing – the amount of pain people suffer before it happens, and which party and politician leads the change.
Agree. Today marks the start of a reallignment of the Green Debate. Rishi must disavow the outrageous uncosted blunt Net Zero commitments of the Fool Johnson and Mad May. 90 minutes of debate remember…a traversty. He must argue for a new deal which eschews coercion and putting the burden on the working class. First – back off heat pump coercion. Second- Batter the local council eco zealots LTNs and dodgy ULEZ. Third – sort of the mad energy pricing mechanism which has warped the market artificially inflating even green prices. Then deliver a new grown up eco vision which delivers energy security to the UK by going big and hard on the Mini Nukes hydrogen and carbon capture. Support the North Sea oil and gas industry. Build more storage. Ease up on tight rules in car production to help develop a car industry under huge pressure from China. Maybe move the target to 2035 in line with Germany. Then get heat insulation in all new homes – it makes sense. This will hammer the crude and extreme Milliband ‘Green is Red’ coercive policies of Labour …and their insane demand that the UK show moral leadership to Xi and his x 35 times our emissions China. It will win mature public support for pragmatic green policies..just in time for an election.
Agree. Today marks the start of a reallignment of the Green Debate. Rishi must disavow the outrageous uncosted blunt Net Zero commitments of the Fool Johnson and Mad May. 90 minutes of debate remember…a traversty. He must argue for a new deal which eschews coercion and putting the burden on the working class. First – back off heat pump coercion. Second- Batter the local council eco zealots LTNs and dodgy ULEZ. Third – sort of the mad energy pricing mechanism which has warped the market artificially inflating even green prices. Then deliver a new grown up eco vision which delivers energy security to the UK by going big and hard on the Mini Nukes hydrogen and carbon capture. Support the North Sea oil and gas industry. Build more storage. Ease up on tight rules in car production to help develop a car industry under huge pressure from China. Maybe move the target to 2035 in line with Germany. Then get heat insulation in all new homes – it makes sense. This will hammer the crude and extreme Milliband ‘Green is Red’ coercive policies of Labour …and their insane demand that the UK show moral leadership to Xi and his x 35 times our emissions China. It will win mature public support for pragmatic green policies..just in time for an election.
Yeah okay, let’s wait and see.
You have oil and power companies claiming to be net zero. How does that work?
They are required by law to reduce the co2 emissions incurred in the process of extraction and refining.
What the buyers of the oil and gas products do with it is another matter.
They are required by law to reduce the co2 emissions incurred in the process of extraction and refining.
What the buyers of the oil and gas products do with it is another matter.
You don’t understand the ways of the world. Mandatory suddenly becomes very unmandatory when the sh!t hits the fan.
It can and will be reversed. The only question is timing – the amount of pain people suffer before it happens, and which party and politician leads the change.
Yeah okay, let’s wait and see.
You have oil and power companies claiming to be net zero. How does that work?
It’s also irrelevant. As Konstantin Kisin explained in his Oxford Union speech, the worlds poorest people who are trying to stop being poor couldn’t give a toss about climate change. Even polling done by the UN I believe proves this. The answer to them not being poor is for their countries to industrialise and use the natural resources available within their borders. That will require CO2 emissions, but if it results in their children being healthier, getting a good education and career, they’ll take that any day of their life over being poor to keep some eco-fanatics in the UK happy.
It’s mandatory. Get used to it.
It’s also irrelevant. As Konstantin Kisin explained in his Oxford Union speech, the worlds poorest people who are trying to stop being poor couldn’t give a toss about climate change. Even polling done by the UN I believe proves this. The answer to them not being poor is for their countries to industrialise and use the natural resources available within their borders. That will require CO2 emissions, but if it results in their children being healthier, getting a good education and career, they’ll take that any day of their life over being poor to keep some eco-fanatics in the UK happy.
Net zero will never happen. Period. It will make people much poorer – not exactly a vote winner. The only question is how far each govt and party is willing to travel down that road before reality kicks them in the teeth.
Russian gas won’t make it better either. It may keep energy costs slightly lower in the short term, but energy costs will still become an economic anchor as more wind and solar enter the market.
The whole problem is that there has not been a debate. Theresa May stupidly signed the country up the Net Zero agenda without even a full debate in parliament.
I am a keen environmentalist but I see Net Zero as a massive lie, a scam championed by vested interests, that will have huge and negative repercussions.
The whole problem is that there has not been a debate. Theresa May stupidly signed the country up the Net Zero agenda without even a full debate in parliament.
I am a keen environmentalist but I see Net Zero as a massive lie, a scam championed by vested interests, that will have huge and negative repercussions.
Scrap Carbon trading. Here’s yet another scientist putting his head above the parapet.
https://www.youtube.com/watch?v=KSfdpmEafGI
Ironically the Ukraine war article on this site points out what is likely to happen to Europe and gas thanks to the Ukraine’s refusal to open the Ammonia pipeline, and then claim the Russian’s “bombed/shelled destroyed it” – (Russia sure has form for blowing up its own pipelines!)
Net Zero was always insane, in the timescales claimed for the UK it is also impossible without mass starvation. Even the BBC’s pointing out how ‘sailing ships’ are making a return is ludicrous as the 2 masted Ketch shown will a) Have an engine (all the one’s I’ve been on have – sometimes the wind doesn’t blow!!) b)the Ketch photograph shows the size of modern vessels in the background – we ain’t gonna import enough food via them in the 23 years left!) Why am I talking of sailing ships and starvation?
Try the P6 graphic on this report.
https://www.icax.co.uk/pdf/Absolute_Zero_Report.pdf
The first party to truly understand the scam that Climate modelling has foisted upon the global population will be the one that wins the next GE, because the way things are going we plebs are going to discover quite quickly how catastrophic are the Green’s policies. Possibley helped by the conversion of this Ukrainian ‘Special Operation’ into a true war. Germany is likely to be stuffed, particularly if they don’t get another warm winter or sensible Green denouncing politicians.
Scrap Carbon trading. Here’s yet another scientist putting his head above the parapet.
https://www.youtube.com/watch?v=KSfdpmEafGI
Ironically the Ukraine war article on this site points out what is likely to happen to Europe and gas thanks to the Ukraine’s refusal to open the Ammonia pipeline, and then claim the Russian’s “bombed/shelled destroyed it” – (Russia sure has form for blowing up its own pipelines!)
Net Zero was always insane, in the timescales claimed for the UK it is also impossible without mass starvation. Even the BBC’s pointing out how ‘sailing ships’ are making a return is ludicrous as the 2 masted Ketch shown will a) Have an engine (all the one’s I’ve been on have – sometimes the wind doesn’t blow!!) b)the Ketch photograph shows the size of modern vessels in the background – we ain’t gonna import enough food via them in the 23 years left!) Why am I talking of sailing ships and starvation?
Try the P6 graphic on this report.
https://www.icax.co.uk/pdf/Absolute_Zero_Report.pdf
The first party to truly understand the scam that Climate modelling has foisted upon the global population will be the one that wins the next GE, because the way things are going we plebs are going to discover quite quickly how catastrophic are the Green’s policies. Possibley helped by the conversion of this Ukrainian ‘Special Operation’ into a true war. Germany is likely to be stuffed, particularly if they don’t get another warm winter or sensible Green denouncing politicians.
Simple majority vote winner for the next election: ban and bin ALL net zero legislation, get drilling for oil and gas…. and piss off the eco sandaloids.
As well as dare I say it, stop further unwanted immigration that compounds the problem.
As well as dare I say it, stop further unwanted immigration that compounds the problem.
Simple majority vote winner for the next election: ban and bin ALL net zero legislation, get drilling for oil and gas…. and piss off the eco sandaloids.
You seem quite gullible, Philip. Rishi announces a review of LTNs. Big deal. He hints about being on the side of drivers but Gove says the 2030 deadline is set in concrete. He announces more licences for the North Sea but keeps a 75% windfall tax that makes it very unlikely that many of the licences will be taken up.
It’s just a craven and unprincipled attempt to buy a few extra percentage points on the opinion polls.
You seem quite gullible, Philip. Rishi announces a review of LTNs. Big deal. He hints about being on the side of drivers but Gove says the 2030 deadline is set in concrete. He announces more licences for the North Sea but keeps a 75% windfall tax that makes it very unlikely that many of the licences will be taken up.
It’s just a craven and unprincipled attempt to buy a few extra percentage points on the opinion polls.
Greens are just not serious people. When I see Green advocacy for nuclear and GMOs and the end of callous indifference to developing countries then they’d be worth talking to.
Greens are just not serious people. When I see Green advocacy for nuclear and GMOs and the end of callous indifference to developing countries then they’d be worth talking to.
Maybe, just maybe, the time has come to question the unquestionable and revisit the scientific basis for the AGW theory which started this mess. It is becoming more and evident, with time passing (and predictions not materializing) and scientific challenges, that CO2 is unlikely to be a culprit, and, horror, horror, the warming climate, and higher CO2 content in the air may benefit humanity.
Maybe, just maybe, the time has come to question the unquestionable and revisit the scientific basis for the AGW theory which started this mess. It is becoming more and evident, with time passing (and predictions not materializing) and scientific challenges, that CO2 is unlikely to be a culprit, and, horror, horror, the warming climate, and higher CO2 content in the air may benefit humanity.
The ULEZ has been put in place to reduce local pollution and doesn’t really have anything to do with the climate crisis. Thankfully however the UK net zero policies are fully legislated and we are bound by law to meet them, regardless of how realistic that is – it would be a very brave and futile political move to try and reverse that in parliament.
On that note, if Sunak thinks it’s a vote winner to reverse green policy then he’s a bigger loser than I anticipated. And why can’t he get some trousers that fit him properly for goodness sake?
Oh come on. Khan’s own report showed virtually no change in pollution levels by expanding the ULEZ.
Pure greenwashing and a money grab that will disadvantage the poorest who can’t afford a new car!
And the notion that EVs don’t create pollution is starting to crumble now. The extra weight from batteries causes greater tire pollution.
https://www.theguardian.com/environment/2022/jun/03/car-tyres-produce-more-particle-pollution-than-exhausts-tests-show
in country and fieldsports circles, electric cars, especially Teslas are social death, a bit like a windsor knot in an Old Etonian or Brigade tie….
in country and fieldsports circles, electric cars, especially Teslas are social death, a bit like a windsor knot in an Old Etonian or Brigade tie….
You have a point, my observation however is that it is about pollution, not climate change. Not yet anyway, no doubt in the future all petrol cars will attract a charge, after 2030 perhaps.
I am with you on generalities not specifics. Pollution and CO2 emissions should be discussed separately. My car is an old 3.5L diesel which is fine where I live (middle of nowhere) but would be inappropriate in London. CO2 needs to be looked at on the whole life model from start to finish.
I am behaving in a more eco-friendly way by keeping my car on the road (years of life left, only done 140K!!) as emissions are not a pollution problem here.
Agreed, an old car has paid it’s ‘carbon price’ when it was manufactured. That can never be taken away. Manufacturing a new EV will increase the carbon footprint. It’s an illogical argument to scrap an old car that’s perfectly usable based on carbon emissions.
Agreed, an old car has paid it’s ‘carbon price’ when it was manufactured. That can never be taken away. Manufacturing a new EV will increase the carbon footprint. It’s an illogical argument to scrap an old car that’s perfectly usable based on carbon emissions.
I am with you on generalities not specifics. Pollution and CO2 emissions should be discussed separately. My car is an old 3.5L diesel which is fine where I live (middle of nowhere) but would be inappropriate in London. CO2 needs to be looked at on the whole life model from start to finish.
I am behaving in a more eco-friendly way by keeping my car on the road (years of life left, only done 140K!!) as emissions are not a pollution problem here.
And the notion that EVs don’t create pollution is starting to crumble now. The extra weight from batteries causes greater tire pollution.
https://www.theguardian.com/environment/2022/jun/03/car-tyres-produce-more-particle-pollution-than-exhausts-tests-show
You have a point, my observation however is that it is about pollution, not climate change. Not yet anyway, no doubt in the future all petrol cars will attract a charge, after 2030 perhaps.
Oh come on. Khan’s own report showed virtually no change in pollution levels by expanding the ULEZ.
Pure greenwashing and a money grab that will disadvantage the poorest who can’t afford a new car!
The ULEZ has been put in place to reduce local pollution and doesn’t really have anything to do with the climate crisis. Thankfully however the UK net zero policies are fully legislated and we are bound by law to meet them, regardless of how realistic that is – it would be a very brave and futile political move to try and reverse that in parliament.
On that note, if Sunak thinks it’s a vote winner to reverse green policy then he’s a bigger loser than I anticipated. And why can’t he get some trousers that fit him properly for goodness sake?