Daily News 10 Dec 2024

Can Europe afford trillions of euros for its ‘net zero’ energy transition? In a word, no

Spending money on the aim of manipulating the global climate is proving extremely expensive, with no sign of any positive results. It’s noted here that ‘the implementation remains dependent on over a trillion euros in investments every single year between now and 2030—and Europeans are already angry enough with their rising cost of living.’
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Summary:
— A new report estimates the EU’s green transition could cost €1.3 trillion annually until 2030 and €1.54 trillion annually until 2050.
— The high cost of the transition may require higher taxes, subsidies, and potentially national green investment strategies.
–Concerns exist about public support for the transition due to rising living costs and potential harm to businesses’ competitiveness.
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Climate finance is a white-hot topic right now, says OilPrice.com.

The COP2 delegates failed to agree on a generous enough deal for the transition in developing countries; in the U.S., project Veritas revealed that the EPA was funneling billions into climate activist organizations ahead of Trump’s presidency to ensure continued pressure on the government; and in the EU, a think tank put a price tag on the transition.

The EU cannot afford it.

Bruegel, the Brussels-based energy outlet, published a policy brief this week focusing on what the EU needs to get to its stated goals of net zero and how much it would cost.

It appears that, for these goals to be hit, the bloc would need to spend 1.3 trillion euros, or about $1.4 trillion, every year until 2030. After that, the price for the transition jumps to 1.54 trillion annually and stays this much until 2050.

The impressive amount of money that needs to be spent on the transition is divided into three categories by Bruegel: energy supply, energy demand, and transport. It may also be an underestimation by the EU itself—because it does not include all the costs associated with the transition, omitting, for instance, financing costs that could be quite significant in their own right.

As Bruegel points out, “the cost of financing investment will be significant for cash-constrained agents, and public finances will need to step in with de-risking instruments to facilitate private investment.”

What this means is that the European Union will need to step up subsidies in all of its transition directions in order to motivate private investors to join it in funding the transition.

That could be a tough job given the current context in transition technologies, which is one with subdued demand despite the strong government support in the form of subsidies.

Full article here.

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December 10, 2024 at 04:08AM

Daily News 10 Dec 2024

Subsidies Galore!

From THE DAILY SCEPTIC

by David Turver

Last week, I came across a government database that I had not heard of before, namely the Subsidy Control Transparency Database. The database was mentioned in an update email from DESNZ, telling me that the results of the Contracts for Difference Allocation Round 6 (AR6) had been loaded on to it. Of course, my curiosity got the better of me and I had to dig in to see what other Net Zero and energy related subsidies might be lurking within.

In the film Whisky Galore, the SS Cabinet Minister runs aground and its cargo of whisky is harvested by the locals. Our cabinet ministers have yet to run aground, but there are plenty of people eager to harvest the subsidies on offer. Over the past two years, I have come across some egregious things in Net Zero world, but even I was shocked by some of the scale of some of the subsidy schemes that have been implemented.

Subsidy Control Transparency Database

Before we dig into the Net Zero and energy related items, we should note some important caveats about the whole database. First, for subsidies recorded as part of the Contract for Difference Scheme (CfD), the government claims the amounts are a “higher end estimate”. Second, it appears as though there are some duplicate entries, for instance SC10301 and SC10069 are both support measures for the development of film audiences, in the sum of £60 million with identical start dates. Finally, the budget amounts might be suspect because the most expensive subsidy line is SC1005, U.K. Film Tax Relief Prolongation which is supposed to cost £2,960 billion, that’s more than U.K. GDP, between April 2020 and April 2025. It is very unlikely that this figure is accurate and so it calls into question the accuracy of other entries in the database.

Of the 1,169 schemes in the database, 1,025 of them have active status. Of these, I judged 144 of them to be Net Zero or energy-related. The total budget for these items is £328 billion – yes, billion, with a ‘b’.

However, there are two items related to the Renewables Obligation Scheme, items SC11007 and SC10753, that have budget values of £1 and £0 respectively. This suggests the budget is understated by a considerable margin, as the OBR forecasts that the RO scheme will cost well over £7 biilion per year for the next few years. The RO scheme has been running for quite some time, so the cumulative subsidies by the end of the scheme must be measured in the high tens of billions, possibly over £100 billion.

There are so many schemes that it is difficult to cover them all here, so we will focus on the largest items and highlight some of the most grotesque absurdities.

Electricity Generation Subsidies

The largest cluster of subsidies is for generating electricity. This includes Contracts for Difference (CfDs), Feed-in Tariffs (FiTs) and ROs. The budget value for CfDs allocated in Allocation Round 6 (AR6), item SC11117, will cost £45 billion over its lifetime. CfDs from AR5 will cost £5 billion, AR4 will cost £15 billion and CfDs from earlier rounds another £15 billion. Some individual offshore wind farms are listed, such as Hornsea (£3.4 billion), Walney (£2.1 billion) and Beatrice (£1.9 billion). Wind energy on remote islands is scheduled to receive £15 billion of subsidies between October 2017 and March 2025. FiTs are calculated to cost £31 billion (item SC10220).

Subsidies to Mitigate Intermittent Renewables

As well as being expensive, wind and solar renewables are, of course, intermittent, so we need to pay for backup when the sun is not shining and the wind is not blowing – or blowing too hard. The Government has created the Capacity Market to provide the backup, but it too will require a subsidy estimated at £16.1 billion up to mid-December 2024. They obviously need to update this figure, as the OBR forecasts that the annual cost of the Capacity Market will rise from approximately £1 billion in 2023–24 to £4 billion by 2027–28. The total forecast from 2023–24 to 2029–30 is over £19 billion.

There’s even a £14 million subsidy scheme (SC10810) to “support innovative technologies with potential to mitigate impacts of offshore wind farms on U.K. Air Defence”.

Subsidies for Using Expensive Electricity

The largest single energy-related item with the highest value is the British Industry Supercharger Package for energy-intensive industries (EIIs) (Item SC11062), with a value of £51 billion. This is designed to provide “electricity price support” to around 370 energy-intensive businesses in sectors such as steel, paper and batteries. There is another £936 million for the Energy Bills Discount Scheme, again targeted at EIIs.

We have a total of £87.4 billion in subsidies for CfDs, another £31 billion for Feed-in Tariffs, £15 billion for remote island wind plus a very large but unknown amount of subsidies for Renewables Obligations, which are, of course, making our electricity very expensive. On top of that, there is well over £16 billion for the capacity market. To compensate for that, we are going to spend £52 billion supporting energy-intensive industries. It is simply an absurd government merry-go-round of subsidy upon subsidy in a vain attempt to mitigate our insane energy policy.

We pay for more than 4,500 people in DESNZ, at a cost of over £400 million per year, many of them to devise these parasitic schemes that are destroying the economy.

Subsidies for Biofuels

In addition to the subsidies for electricity generation, there is an insane total of £45 billion allocated to various Renewable Heat Incentive (RHI) schemes (Items SC10126, SC10120 and SC10119), which essentially incentivise farmers to burn wood to heat empty sheds out to 2040.

There is also another £2 billion for green gas and a further £1.1 billion for the Teesside CHP biomass plant.

Subsidies to Make Electricity Generation Less Efficient

But the madness does not stop there, because another £30 billion of subsidy has been allocated to the Dispatchable Power Agreement Business Model (Item SC11175), designed to support gas-fired power stations by incentivising the installation of carbon capture and storage (CCUS) equipment. There is another £13 billion to be spent on other CCUS-related subsidies and £2.5 billion more for various hydrogen subsidy schemes.

Subsidies to Transform Society

A total of £1.28 billion has been allocated to transforming the automotive industry to deliver an electrified supply chain and a further £289 million for the Industrial Energy Transformation Fund (IETF).

Several other items relate to decarbonising heat in social housing, worth a total of £2.1 billion and a further £450 million for boiler upgrade schemes. These schemes are designed to implement the same types of measures that the Government DEEP report calculated would have payback times measured in centuries or millennia.

On top of all that, there is another £567 million subsidy for various ultra-low emissions bus projects.

Subsides for Reliable Energy

In contrast to the hundreds of billions to be spent subsidising low-density, intermittent power sources like wind and solar, £409 million (with an ‘m’) will be spent on various nuclear research and development projects. They have also calculated that the Hinkley Point C nuclear power plant will only cost £130 million, which is an anomalously low figure, since they are projecting spending of almost £8 billion on Sizewell C. Even that figure pales into insignificance compared to the various forms of renewable subsidies.

Conclusions

We must exercise some caution when drawing conclusions because of the obvious howlers in the data. Of course, we are not going to spend £2,960 billion on tax relief for the film industry. However, when it comes to the energy-related items, it does appear as though the mistakes tend to underestimate the cost of subsidies. The RO scheme will obviously cost much more than £1, and the Capacity Market will cost more than £16 billion.

We see a truly surreal arrangement of subsidy schemes, ploughing hundreds of billions into renewables, alongside additional tens of billions in subsidies to industry to mitigate the impact of the resulting high energy prices. It is completely insane. All this renewable energy largesse contrasts markedly with just £24.6 million allocated to the Armed Forces Covenant Fund Trust, mostly capital funding for housing.

Imagine what society would look like if we stopped subsidising incompetent and expensive forms of energy and their parasitic cheerleaders. Bills would be lower, taxes could be lower and more companies would have the confidence to invest in Britain and create jobs. Expensive energy and the accompanying subsidies are killing the economy. We must ditch the Net Zero madness now.

David Turver writes the Eigen Values Substack, where this article first appeared.

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December 10, 2024 at 04:02AM

Daily News 10 Dec 2024

Great Cumbrae: Millport DCNN 6186 – a classic example of most that’s wrong with the Met Office.

55.74936 -4.90788 Met Office assessed CIMO Class 5 Installed 1/1/1959

Great Cumbrae is an island of around 1400 souls in the Firth of Clyde with Millport being its main town. The weather station is in the grounds of the Field Studies Council, a charity offering both educational courses at almost all levels as well as holiday facilities outside term times. The site was automated in 2010 following reasonably diligent manual observations that unfortunately were not maintained through the pre Christmas to post Hogmanay celebrations. It looks fairly inoccuous but there are lots of unnecessary problems.

A recent close up post automation view reveals a total lack of any defined or enclosed observations area.

With no attempt at security there can never be any, even vague, guarantee of being tamper proof. The Met Office regularly refers to “enclosures” and “observations areas” with all their websites showing well enclosed sites. Huge numbers, though, are like this above with nothing to stop extraneous effects such as those demonstrated at Banff with cars parking in close proximity. It is worth noting that claiming weather “records” can be very advantageous to an area and potentially motivated.

“Gravesham councillor Mick Wenban (Con) was shocked to learn the news. {closure of Gravesend weather station} He said: “It’s a real shame because it always put Gravesend on the map by recording the highest temperatures in the country.”

Although the Met Office does acknowledge the site’s poor location (the parapet wall behind is south facing) it somehow fails to notice the extensive shading which should be reflected in its rating as 5S not just 5. The Bing aerial image shows the depth of shade quite clearly.

Further street view imagery going back to the site’s manual reporting days in 2009 indicate the building to the north west is absent so the whole area’s climatology has clearly degraded since its construction.

It is also notable that the screen was not in the best of conditions and required holding upright with ropes and stakes – possibly an indication of the strong prevailing winds off the Clyde experienced at this exposed coastal site.

All of these issues seem not to deter the Met Office from proclaiming this unrepresentative island and coastal site as somehow acceptable to regularly claim the “Extreme” for a region that extends a considerable way inland. And should just 8.8°C really be defined as an “extreme” or is this just another example of “spooky language“?

Yet again, though, by clicking on the link for further insight into the day’s readings at Millport you are directed to the rural Glasgow Bishopton site which is well inland and quoted as 18.3 miles away. Furthermore Bishopton itself is over 11 miles from Glasgow and really seems somewhat misnamed.

Why the Met office feels they should sometimes (but not always) fail to offer the data for the site claiming the extreme is never explained. The stranger still because it is freely available elsewhere. I am confident they will be able to offer an “excuse” rather than a reason for this but it clearly is an unnecessary confusion. Here is this “mysterious” data.

In conclusion Millport weather station is insecure, inaccurate (by siting up to 5°C), in front of a new south facing wall and building elevation, with potentially cars parking alongside, subject to heavy shade, with long term observation and reporting deficiencies, set in a windy maritime site on an island and for which its readings are somehow covert……..but the public is supposed to trust its data and have faith in decisions based on the “evidence” drawn from it.

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December 10, 2024 at 03:38AM