By Paul Homewood
Time to look at the new Labour Manifesto’s green strategy:
https://labour.org.uk/manifesto/a-green-industrial-revolution/
First, a few general points:
1) A £250m Green Transformation Fund is being set up, dedicated to renewable and low-carbon energy and transport, biodiversity and environmental restoration.
This will operate via a National Investment Bank. Therefore £250m will not necessarily represent the full cost involved, as this money will be lent, and some presumably repaid at some stage.
2) The Treasury’s investment rules will be rewritten to guarantee that every penny spent is compatible with our climate and environmental targets – and that the costs of not acting are fully accounted for too.
In other words, lending will not have to be commercially viable, and McDonnell can effectively make up his own rules up as he goes along.
3) According to the manifesto, “To balance the grid, we will expand power storage and invest in grid enhancements and interconnectors”
There is no recognition of the fact that storage or other “grid enhancements” cannot cope with the intermittency of renewables, which means we will end up relying in interconnectors. Any government that sells our energy security short in this way does not deserve to be in power.
Below is the core of the proposals though:
It is not clear where they get their 56% for buildings claim from. Residential only accounts for about a quarter. There will be a small bit extra for public and commercial buildings, but that would get you nowhere 56%
The manifesto gives no costings for any of these proposals. However, Prof Michael Kelly, the former chief scientist at the Department of Communities and Local Government, gave some details in his recent GWPF lecture of insulation trials carried out by the Dept in 2010.
The houses were retrofitted with internal and external cladding, double glazing and new appliances, costing an average of £85000 per home, but only reduced energy usage by 60%, the equivalent of about £300 pa. Clearly there is no financial logic for such expenditure.
(Interestingly, the Tory manifesto promises insulation and energy improvement measures for 2.2m homes, aimed at poorer people. This is costed at £6.3bn, about £3000 per home. The Telegraph reckons energy bills would be cut by £750 pa, which sounds to me to be utterly nonsensical).
Kelly reckoned the cost of a total UK wide refit could be £2-3 trillion., though this would presumably include the cost of installing heat pumps. Fitting heat pumps to half Britain’s homes would cost in the order of £130 billion.
As for hydrogen, the CCC has already estimated that a national switchover to hydrogen would cost £50-100 billion just for household conversions. That figure does not include the extra cost of building new hydrogen producing plants.
Already it is evident that £250 million won’t go very far!
As for the rest, it is not clear how “they will build new nuclear plants”, as the UK does not have the expertise anymore. Maybe McDonnell will nationalise Hitachi and EDF! Otherwise he needs to tell us how much Labour are prepared to pay in subsidies for new nuclear.
7000 new offshore wind turbines would increase offshore capacity almost ten-fold, assuming they are 10 MW each, the same as being currently planned for the Moray wind farm. Moray’s 950 MW project is estimated to be costing £2.6 billion. On this basis, Labour’s planned new turbines could cost £190 billion. And that’s before the new onshore wind farms and solar farms!
Quite clearly we are talking incomprehensible amounts of money here. Certainly, if we are to take their plans literally, well over a trillion, and all within the space of ten years. The new £250 billion green fund being set up will only be the tip of the iceberg.
And to what benefit? The manifesto admits that spending will not have to be commercially justified. There will be some savings to be offset, such as reduced energy usage. But most of this expenditure will simply replace what we already have, that is an energy network which works perfectly well.
It is inevitable too that such a bureaucratic spending binge will be hugely wasteful.
And, sooner or later, all of that money borrowed will have to be paid back.
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November 26, 2019 at 08:09AM
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