John Rentoul’s Fake Cost Of Net Zero

From NOT A LOT OF PEOPLE KNOW THAT

By Paul Homewood

There has been discussion in the media in the last few days concerning claims that Net Zero will only cost the UK £6 billion a year.

The claim originates from John Rentoul of the far left Independent, in response to Nigel Farage’s estimate of £40 billion. Needless to say, the claim is fake.

The big problem here is that successive governments have steadfastly refused to carry out any proper cost assessment whatsoever, so critics of Net Zero have no option but to make their own estimates.

Probably the nearest we got to an official costing was from Philip Hammond’s Treasury in or around 2019, which was in excess of a trillion pounds, £33 billion a year. Given inflation since, Farage’s figures do not appear unreasonable.

https://twitter.com/JohnRentoul/status/1927404927443157491

Rentoul’s figures are based on the CCC estimate of 0.2% of GDP. But there are huge issues with this, which make Rentoul’s analysis grossly misleading.

For a start, the CCC’s Seventh Carbon Budget is clear that the costs will be huge in the early years up to 2040, after which quite miraculously savings will set in.

But people are not interested in hypothetical savings in twenty years time – they are concerned about the immediate future.

The CCC analysis was also full of holes. They assumed, for instance, that wind and solar costs would be half of what they actually are now, and would continue to fall. NESO’s Clean Power 2030 plan confirmed that the CCC’s CAPEX figures had been understated by £30 billion a year.

They also said EVs would achieve price parity with petrol by next year. Both assumptions are plainly absurd, and mean that their estimate of costs has been grossly understated. (See here).

Moreover the CCC ignored the massive costs we are already incurring for Net Zero.

We can however estimate some ball park figures for the period up to 2040.

For a start, according to the OBR, subsidies for renewable energy will run at £19 billion a year between now and 2030. Over the 15 year period to 2040, that adds up to £285 billion. Given the rising cost of offshore wind, that figure is likely to be an underestimate.

Throw in the indirect subsidies of grid balancing, constraint payments and carbon pricing, and the annual figure will be closer to £30 billion.

Then there are grid upgrades costing £100 billion, which are needed for Net Zero. Although this will be paid for by private investors, they will demand a return – say 8%, or £8 billion a year.

Then we come to heat pumps. By 2040, everybody with a gas boiler will need to replace with a heat pump. I believe about 20 million homes have gas boilers. Including extra insulation, hot water tanks and radiators, we are probably looking at £15,000 a go, compared to £3000 for a boiler. That’s a total cost of £240 billion.

EVs remain stubbornly more expensive. Even allowing for savings on fuel costs, the extra cost of purchase will amount to at least £400 billion between now and 2040, if EVs remain more expensive.

And we have not even looked at the crippling cost of upgrading our local electricity networks to handle extra demand for power. Estimates suggest upwards of a quarter of a trillion pounds.

There are all sorts of other less tangible costs – not least damage to industry and destruction of the rural economy, the costs imposed on industry and the tens of billions handed to the idiot Miliband to waste on climate nonsense.

But even the items covered above are frightening:

£1210 billion, of course, works out at £80 billion a year, so Nigel might have underesti