New Energy Bill Is A Disaster
Press Release from The Global Warming Policy Foundation
London, 23 May: With the publication of its draft Energy Bill, the government has announced its intention to reverse the course of energy deregulation.
The Global Warming Policy Foundation warns that any attempt to turn back the clock to the dark period of centralised energy planning will not only damage Britain’s economy, but will almost certainly end in failure, just like other attempts to impose a centralised system of energy controls have failed in the past.
Nigel Lawson, the GWPF’s Chairman, who as Energy Secretary was the architect of Britain’s energy market deregulation in the 1980s, warned:
“The Energy Bill constitutes a disastrous move towards a centrally planed energy economy with a high level of control over which forms of energy generation will be favoured and which will be stifled. The government even seeks to regulate the prices and profits of energy generation.”
The government bases the case for green – and more expensive – energy in large part on the assumption that gas prices will significantly rise in the future. This argument is no longer credible in the light of the growing international abundance of shale gas, not to mention the likely shale gas potential in Britain itself.
North American gas prices have dropped from $15 per million British thermal units to below $2 in just 7 years. This price collapse is an indication of things to come in Europe, once its own vast shale deposits are allowed to be extracted.
“At a time when most major economies are gradually returning to cheap and abundant fossil fuels, mainly in form of coal and natural gas, Britain alone seems prepared to sacrifice its economic competitiveness and recovery by opting for the most expensive forms of energy,” said Dr Benny Peiser, the GWPF’s director.
In any case, the complex and inconsistent measures of the draft Energy Bill are unlikely to provide investors with the certainty they require to make substantial investments.
The proposed contracts for difference (CfDs) are extremely complex and convoluted. Neither the profit guarantees offered for different technologies nor the duration of CfDs is known. The government has not provided any numbers and price guarantees for its favoured green technologies. Investors are therefore thrown into limbo since they cannot calculate whether expensive renewables or nuclear reactors are viable and can compete with less expensive conventional power plants.
This lack of clarity will inevitably lead to constant government amendments and continual intervention, which will act as additional barriers to new entrants in the UK electricity market.
In light of government indecision and investors’ uncertainty, the Energy Bill proposes to give the Secretary of State the exclusive authority to offer green energy companies ‘letters of comfort,’ promising them that they will be guaranteed profits once the specifics of CfDs are finalised and introduced. This is both arbitrary and unconstitutional.
Moreover, it is doubtful that what is proposed is actually workable, let alone economically viable. After all, similar interventions in the past have proved inept and uneconomic. They will almost certainly prove to be highly unpopular when the costs of these measures are reflected in energy bills.
Just sayin, look for the roots of what we currently see in front of us.
http://www.un.org/esa/dsd/agenda21/
Ya think this is real yet? Think about it…………
Doug, If you have a free market in energy then electricity has to compete with all sorts of other sources of light and power. True enough that electricity does some things very well. But it is never the most efficient source of power. Natural competition exists for the electrical grid. Yourr natural monopoly has severe limits. Charging the highest possible price will reduce sales, so an electric utility is always seeking to sell the most electricity it can at the highest price which is a completely different animal than solely the, “highest possible price.” Once the generators are turning you might as well sell the last kilowatt for something – the sunk costs in generating electricity are immense. Where energy markets are the most free, all energy prices are lowest.
Prices will fall with shale gas?
This is the most outrageous of the misunderstood shale gas. Prices in the US/Canada have dropped to under $2/mcf due to oversupply, not cost of production & transportation.
Think! Shale gas was not pursued earlier because it was more expensive than conventional supplies. The technology did not exist to produce it in significant volumes, but that technology did not create a low-cost process. Shale gas production is expensive!
Shale gas will be 3X or more the cost to the consumer than whatever it is he is buying right now if the supply-demand is out-of-whack as it is in North America. The price you will pay is cost plus profit.
Look to the companies profiles! Work out the cost base and then double it: long-term costs are greater than short-term.
Shale gas is NOT a low cost energy source. It is a good energy source, but not low cost.
May 23, 2012 at 4:06 pm, youngleftie says:
[ … ] What I am advocating is that the government looks into initiatives that ensures that the little people don’t get screwed [ … ]
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Weird, ay ? So what’s the government been doing forcing inefficient and expensive ‘renewables’ energy onto everybody’s energy bills ? The market left to its own devices would ensure that the energy source cheapest to exploit would be exploited … and consequently “the little people don’t get screwed”.
Green eco-fascism is the cause of high energy costs and the subsequent escalating fuel poverty.
Just remember to vote this year !
This arrived to me via the e-mail, source unkown:
” Ineptocracy ( in-ep-toc’-ra-cy )
A system of government where the least capable to lead are elected by the least capable of producing, and where the members of society least likely to sustain themselves or succeed, are rewarded with goods and services paid for by the confiscated wealth of a diminishing number of producers. “
So “green” electricity is to provide base load is it?
At this moment wind is supplying 0.1% of the supply (http://www.bmreports.com/bsp/) 44 mw
Wonder if enough people will vote UKIP at the next election? i can only hope so as they seem to have the only sensible policy on energy along with most other things. Otherwise the UK will be more like North Korea
John Whitman says: “Didn’t the UK get the memo on the failure of central planning in the 20th century?”
In the insane world of Socialist thought, the solution to the failure of central planning is…{drum roll}…more central planning.
Richard said;
‘It seems David Cameron is determined to supplant Ted Heath as the worst UK PM since the Napoleonic Wars.’
Ha! Yes, i thought that Ted Heath could never be beaten although Blair gave him a fair run for his money. Brown would comfortably occupy that spot if he hadnt kept us out of the Euro but he did, albeit that he didnt want to lose imfluence. Cameron will really need to raise his game if he is not to wrest the prize from Heath, not easy though when you have someone like Clegg around your neck.
tonyb
_Jim at 8pm
Perhaps Gail is referring to foreign tax havens such as the Cayman Islands.
http://abcnews.go.com/Blotter/romney-parks-millions-offshore-tax-haven/story?id=15378566
Don’t get me wrong. I am happy for anyone to pay 15% in taxes, as was finally reported after months of pressure. I just think that should be a flat tax for all Americans.
The increase in wealth of the wealthiest 1000 people in the UK over the last 10 years is more than enough to pay off the UK national debt. That’s just the ‘increase’ in their wealth over the last decade not the actual total wealth.
“Forget the double-dip recession, ignore record unemployment, the rich are getting richer.
The combined wealth of the richest 1,000 people in the UK rose 4.7 per cent last year, surpassing a previous high set before the 2008 financial crisis. The result is a new global elite, living lives of luxury and privilege the rest of us can hardly fathom.
The UK’s capital has become a haven for the world’s super-rich, thanks to attractive tax laws for those who can establish an overseas “domicile”. A trend towards tax cuts for high earners has also given the wealthy, wherever they reside, increased freedom to decide how their riches are allocated.
So what do they spend it on? Super-yachts, super-prime real estate, and large philanthropic donations (tax arrangements dependent).”
http://www.independent.co.uk/news/factfiles/fact-file-the-superrich-7746617.html?origin=internalSearch
good news from Queensland Australia:
24 May: Ninemsn: Govt scraps northwest Qld solar farm
The Queensland government has pulled funding for a solar farm in the state’s northwest to save money.
Minister for Energy Mark McArdle on Thursday said the government had withdrawn its financial support for the Cloncurry Solar Farm to save Queenslanders about $5.6 million…
“These are savings which will benefit all Queenslanders rather than localised climate initiatives,” Mr McArdle said in a statement on Thursday.
***It was up to the private sector to decide whether to invest in such projects, he added…
http://news.ninemsn.com.au/article.aspx?id=8472810
***what a novel idea!
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Solar panels in the UK. Just where is the simple real science. Millions installed, so where is the real data, how much does output really decline over time, how much to maintain, how long do the batteries and inverters last. Huge rail locomotives are stopped in their tracks by leaves on the line. So how are panels cleaned positioned as they are on roof tops.
Wind, how much output does a selected bunch achieve against rated output. How much real actual time off line. How much to maintain and repair. Where is the real operational data. Commercial secret maybe. Hell no, they where bought and paid for with subsidy, paid by the people and run by extorting high prices from consumers. public domain data.
We need to know and know now. Publicly and very visibly, not hidden in some arcane paper, behind a paywall.
@tonyb
The mere fact of repealing the Labour Party’s fascist Identity Card legislation means that Camoron will fail to wrest the number 1 slot away from Heath and will have to be content with joint second with Gurning Gordon, who, as you say, did at least keep us out of the Euro. Blair was never quite bad enough to match this dynamic trio. It’s a close run thing all round though.
Sigh. The quality of politicians has been, with one or two exceptions, tragically low for most of my life.
“richardscourtney says:
May 23, 2012 at 3:32 pm
But history shows the Tories always muck-up our industrial, fiscal, economic and energy policies, so I suppose this was to be expected.”
You have to be kidding right? Don’t you remember the rolling blackouts, power/car/nurse/teacher worker strikes, the winter of discontent?
Germany pulls the plug on emissions trading.
http://uk.reuters.com/article/2012/05/22/us-bavaria-emissions-idUKBRE84L0SN20120522
Just in time for Australia’s carbon tax. Thanks Gillard!
youngleftie argues that it is deregulation that has thrown people into fuel poverty. Utter rubbish!
Fuel poverty is caused by the rising costs incurred paying for the subsidies that green energy attracts. Until the waltz for wind electricity prices in the UK were controlled at a low level by competition. Government insisted on the green route which required the subsidies to encourage companies to build the wasteful windmills. Scrap that plan and prices will fall.
We have another problem with the Secretary of State Edward Davey MP who has carried on where Huhne left off, claiming more and more stupid things about a subject he is totally ignorant about. Well he is a Liberal.
OK firstly, I know someone pointed out i used monopoly instead of oligopoly, but I did use oligopoly earlier, I do know the difference and it was a slip of the tongue for which i apologise. Secondly, people are saying that, were the government to take over energy production, they too would turn into a ‘corporation’ just like those currently running the market. Well ok, maybe that is true (altough i doubt it), what if we turned the ‘corporation’ running the energy sector into a worker’s co-operative, as well as intoduce a constitution into this corporation that only allows minimal profits to be made out of the public, if at all, and that guarantees government funding for those too poor to pay for their own energy?
It really makes little difference for the UK. Their long energy winter started a few years ago. One wouldn’t be surprised to see them tearing apart their homes in all those “snowless” winters they’re having. The issue is whether they even can even decide toclimb back up from their diastorous foolishness at the alter of environmentalism. The choice is stark – cheap energy or mass die off. You simply cannot support the population on the wisp of the wind. That’s not even considering the lead times to build what is needed just for them to survive.
Gives an updated meaning to “mad dogs and Englishmen”. The land of the Enviro Nutters.
Nigel Lawson is as wholly wrong to disapprove of this as he was to be a major part of the flogging off of this country’s formerly publicly owned infrastructure in the 80s/90s. This is the first halfway sensible thing this dreadful government has done since they were elected (?).
Perhaps, if the “free market” were in any sense as “free” as its very vocal supporters seem to think it is, it might work, who knows. However, since the real “free market” simply involves the richest parasites freely buying everything in sight at bargain basement prices, freely stripping the assets for their personal gain and freely racking up the prices paid by the public, also for their personal gain, it is simply legalised theft. Oh, and freely paying their bought-and-paid-for politicians to pass laws to legalise more of the same.
Now let’s see the same approach on water, railways, and all the rest of our stolen infrastructure.
If anyone thinks ‘green’ energy is a good idea, take a look at
http://www.bmreports.com/bsp/bsp_home.htm
which gives a breakdown of the UK’s energy generation.
Earlier this morning all of the UK’s windmills were generating a pitiful 22 MW, and the percentage figure for the last 30 minutes was actually zero. As I write, they are putting out a massive 21 MW.
I don’t kniow why, but the phrase ‘completely barking mad’ comes to mind….
Chris
“youngleftie says:
May 24, 2012 at 2:52 am
Well ok, maybe that is true (altough i doubt it), what if we turned the ‘corporation’ running the energy sector into a worker’s co-operative, as well as intoduce a constitution into this corporation that only allows minimal profits to be made out of the public, if at all, and that guarantees government funding for those too poor to pay for their own energy?”
There are many example of this in what was called the USSR. It didn’t work. Any “profit” went to the elites and nothing was re-invested. But I don’t see why someone else should be bound to pay for the energy I cannot afford to pay. Have you checked out what is happening in Italy and Greece recently?
Having been there at the time the government “flogged “off the infrastructure I saw that after the socialists stole said infrastructure from private hands, at a time it was well maintained and working well, they then failed to maintain it or ready it for the increasing population, this was most obvious in the case of water / sewage and railways, the gas and electricity boards were diabolical to deal with. After privatization money flowed to upgrade services to fit the times. Please dont make unfounded statements based on private prejudices and ignore the facts!
Sic transit gloria Britannia.