The canary in the coal mine: the energy crisis and Net Zero | Charlie Goulbourne

You would be forgiven for wondering how, in the last decade, the Net Zero agenda has risen from relative insignificance to become the single policy to which all others must be subservient.

It arises particular suspicion that while we are living through a period of universally managed decline, having lost the belief that we are capable of building anything at-all, we are simultaneously pitting the hopes of our civilisation on our ability to lead the greatest age of material progress since the Industrial Revolution.

In fact, our only significant national infrastructure project of the last decade, the modest proposal of a single railway (those things that once covered our country), is currently running three-times over budget, with large parts already abandoned and its completion date pushed back to 2045.

Is it reasonable to believe that between today and the completion of HS2, the UK will have entirely replaced its energy supply with carbon-neutral renewables, entirely replaced all transportation and industrial infrastructure with carbon-neutral alternatives and developed novel technologies to remove huge amounts of carbon from the atmosphere?

At this rate, we would count ourselves lucky if HS2 alone was completed by 2050. It is time to admit that Net Zero was always an absurd policy dreamt up by utopian green ideologues with little interest in grounding their vision in environmental or economic reality. And when ideology conflicts with reality, one thing is certain. Crisis.

Wholesale gas prices rose by around 400% during 2021 causing sudden increases in electricity and heating bills, with another 50% increase in the energy price cap planned for April. As a result, the Green Levy, which covers much of the cost of new insulation and energy-efficient boilers, will likely be scrapped, the government will give huge loans to energy firms and taxes may even be raised on gas producers.

On top of this, ‘energy rebates’ will be handed out to help desperate families pay the bills and must be repaid over the next five years. These essential measures, taken together, will serve to amplify energy prices, shift the burden of the crisis to the taxpayers of the future and critically, set back key Net Zero commitments by years.

We are fortunate enough to have been provided with a short preview of our promised Net Zero economy. In fact, the measures that have led to this crisis are precisely the same measures that have been lauded as paving the way for Net Zero.

The government’s recent ‘Build Back Greener’ report smugly informs us that we are “almost half-way to ending the UK’s domestic contribution to man-made climate change”. Although it is indeed true that our carbon emissions are over 40% lower today than they were in 1990, these reductions largely find their source in a single sector. Energy. 

If we wish to understand how the project of energy decarbonisation has led to our current crisis, it’s worth briefly surveying the history.

Since the first national grid was established in 1926, the demand for electricity has increased almost exponentially and had reached record highs of over 300 TWh by 1990. Yet, during this entire period, one thing had remained constant. Highly polluting coal dominated our energy supply. Only the slow establishment of nuclear power from the late ‘50s onwards had come close to threatening its hegemony.

As the calendar turned to 1990, the greatest revolution in our energy history took place almost overnight and it is to this that we attribute our apparently heroic carbon reductions. The so-called ‘dash for gas’ initially had little to do with the ‘green agenda’, rather it was motivated by a newly privatised and de-regulated energy industry, the development of the North Sea gas fields and the innovation of cheaper, more efficient gas turbine generators.

By 2008, coal had been supplanted by natural gas as our dominant electricity generation source and by 2020 it barely produced 1% of our electricity. As a result of the explosive growth of natural gas, which emits only half the carbon emissions of coal, our energy supply rapidly decarbonised.

On the face of it, this was extraordinary achievement but beneath the surface there were fissures which, if ignored, would soon expand beyond repair. Not only had the privatisation of the energy industry exposed us to the international market but it was also becoming clear that the green lobby would not be satiated by anything but an immediate transition to non-nuclear renewables.

It was too late to change the former and the latter was a naïve dream, decades off at best. So, for the next 20 years, the UK was held hostage by green zealots and coerced to attempt a direct transition to renewables with an ever-dwindling supply of domestic natural gas.

None of this implies that we could not have secured the benefit of decarbonisation without the accompanying weaknesses. This crisis was not inevitable. If our leaders had heeded the warnings of those that had noticed the fissures, they could have been repaired and even acted as the foundation for something much more robust.

For example, we could have built a large fleet of nuclear power stations while there was still a will to do so. Unfortunately, Labour closed the door on that in 2002 and instead gambled on “promoting energy efficiency and expanding the roles of renewables”. 

Although they later corrected their mistake in 2006 by announcing their plans for a new fleet of nuclear power stations, it has since been continuously stifled by the same groups to which they had initially ceded authority. High court battles with Greenpeace, public and private disinvestment due to the Fukushima incident and concern over Chinese state involvement mean we won’t get a new nuclear power station until at-least 2026 with the opening of Hinkley Point C.

The story is much the same for gas. Before 2004, the UK was not only self-sufficient but a net exporter of natural gas. However, as the cost of exploring new gas fields increased and international gas transportation infrastructure improved, the abandonment of our most important natural resource begun.

While Thatcher’s privatisation of our energy industry had facilitated efficient development of our gas-powered grid, without further change, it began to undo the resilience it had created. Instead of remedying the structural instability, Labour continued their hostility to domestic fossil fuel production and insisted on market-driven energy policy which favoured gas imports. In much the same way as nuclear energy, correction has become impossible.

Legal battles with environmental advocacy groups in the High Court and intense public pressure have ruled out fracking and obstructed any attempt to expand our North Sea gas or oil operations. Today, we are left reliant on imports to power and heat our nation and this reliance is expected to rise to 70% by 2030. We had placed our bets on a renewables revolution arriving by now. It hasn’t and so we have lost.

We have identified the fundamental problem of the ideological driving force behind Net Zero. Much like the Marxist, it attempts to capture the technological apparatus gifted by capitalistic innovation and organise an idealistic economy around it.

The unforeseen consequences soon outnumber the foreseen many times over and the folly of man trying to tame the chaos of the economy (or the environment) become clear. Like the pursuit of any utopia, our dreams collapse under the weight of the ignorance and imprudence of mankind.

The utopia here is not a classless society but one that undergoes instantaneous technological change that leads to the banishing of waste from the largest, most prosperous, and most consumptive civilisation ever to exist. Although much like the classless society, it will never arrive.

Thanks to the improvements in our energy sector, it now only contributes one fifth of the UKs total emissions. Not only has this limited the potential for further emission reductions from our energy supply but it has convinced our political class that the ideology which sabotaged the innovation which it was gifted has been successful. From this misunderstanding, they have made a terrifying conclusion. We must apply this approach to our entire economy. 

Once we begin, there is no turning back, lest failure is admitted. This is the rallying cry that Marx himself gave to the workers of Germany. The permanent revolution.

The canary in the coal mine has died and instead of evacuating, we have decided to double down. 

The first mission of the Net Zero agenda has ended in defeat. The lofty goals ahead are many orders of magnitude more complex, the chance of failure is much higher, and the cost of failure is unconstrained. 

Once this is understood, the echoes of this crisis are heard on every page of the 2021 Net Zero Strategy report.

Yet again, appeals to distant and speculative technology are used to justify reckless economic transformation. By my calculations, carbon capture and storage is mentioned 260 separate times in the report. That averages almost one every page.

It is employed as a constant Deus ex machina to solve every incoherency in the Net Zero policy. It is made abundantly clear that without it, not only will Net Zero be a complete impossibility, but we will never be allowed to re-shore our energy or industry. 

The reality though, is that carbon capture is an enormous gamble and it may never be functional at a large scale. Even the most-cutting edge carbon capture projects, the Petra Nova and Kemper plants in the US, have recently been abandoned after tens of billions of dollars yielded capture rates of less than a third and plagued the power stations to which they were attached with constant interruptions.

Hydrogen, mentioned 504 times, is also used as a cure-all for Net Zero. And we’re already relying on its rapid success. For example, the refusal to build any new coal mines for steel production, including the blocking of the plans in Cumbria last year, has left our steel industry (and supply) entirely reliant on coal imports.

The solution? Soon we will have a booming ‘green steel’ industry, produced using hydrogen.

This provides a perfect example of the huge economic fragility we are creating on the faith that future technological developments will produce the fix. The bad news? The ‘blue hydrogen clusters’ that are invoked in the government’s strategy have been fruitless when tried in real life. The technology to produce new steel from hydrogen simply does not exist yet and even if it did recent analysis has demonstrated that blue hydrogen actually emits 20% more greenhouse gas in its lifecycle than fossil fuel equivalents. 

We are jumping out of a plane in the hope that we can weave together our parachute as we fall. 

If the multi-trillion-pound investments, the enormous, front-loaded costs, the billions in stranded assets and the economically unstable transition fail to produce the Green Industrial Revolution, which we have little evidence it will, then it may very well break our country so thoroughly that we will look back on this crisis as if a golden age.

The government must learn very soon that unless the Road to Net Zero is economically sustainable, it will inevitably fail and any environmental good it could have achieved will be undone. In a time that uniquely calls for pragmatism, we seem intent on anything but.

Technological innovation should be embraced but our country should not become dependent on its success until its success has been demonstrated. 

We should all fight for a prosperous green future, but the reckless pursuit of the Net Zero utopia will leave us with a future that is neither green nor prosperous.

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