One front page does not a crisis make. But the malcontent over climate change policy is growing and, with rising energy prices, can only become worse. Green campaigners shouldn’t be complacent about this because while the science and economics of climate change may largely be settled, the politics are not.
Last week’s Mail splash was a mash-up of two stories, both essentially from the same source; the Global Warming Policy Foundation. One part, which is of less interest, is based on a paper by Lord Andrew Turnbull, an economist and trustee of GWPF who served as Cabinet Secretary during the Blair years.
Turnbull’s is the tone of a climate sceptic. And while it would be a mistake to dismiss his views as irrelevant, there is strong evidence that recent controversies have had little impact on public confidence in climate science. But the other part of the Mail’s story should be of more concern, not least because it positioned right on the fault line between climate change policy and the state of the economy (or at least people’s experiences at the household level).
Using GWPF data, the Mail claimed that ‘cash strapped families pay an average of £200 a year in stealth levies to subsidise Britain’s massive expansion of wind farms, solar panels and ‘environmentally friendly’ heating schemes.’
This claim is at least partially debunked on fullfact.org and it’s worth noting that incentives for renewable heat are in fact funded from general taxation rather than by a levy on energy companies that is passed onto consumer in their bills (which makes a difference because the burden falls less on the shoulders of poorer households than had the policy been paid for energy consumers). But at a time when bills are rising – and rising dramatically – and household incomes are falling in real terms, the truth that a not insignificant proportion of people’s bills fund renewable energy is a hard fact to swallow.
There is also a kernel of political truth at heart of the Mail’s hyperbole. The same Cardiff University/Ipsos-MORI polling that shows public acceptance of climate science holding firm also sees 78 per cent of people questioned being ‘fairly’ or ‘very’ concerned that electricity will become unaffordable in the future. The lion’s share of future increases in people’s bills is almost certain to come from rising fossil fuel prices, but politicians may find it increasingly difficult to pile more climate policy costs onto domestic bill-payers; the Coalition has already backed off from doing this in the case of the RHI. But paying through taxation at a time when such stringent public spending cuts are being made also may be hard to sustain.
How then do we defend paying for renewable energy infrastructure at a time when the truth – or a somewhat distorted version thereof – is proving convenient for climate naysayers and fossil fuel lobbyists alike? There are three elements to this.
The first involves stressing the co-benefits. Unless economic growth in Asia grinds to a halt, demand for fossil fuels can only increase and even coal prices are likely to be high. Renewable energy will be essential in ensuring the UK has an affordable and secure supply of energy in future even if it is costly now. There are strong signs that after years of subsidy, solar power is now becoming competitive with fossil fuels; the cost of solar cells has fallen by 60% in the last 5 years, bringing solar to near grid parity at peak demand in the US.
The second involves innovation. In 1984, a well-known consultancy firm advised a well-know US telecommunications company not to bother developing wireless technology because there would never be a sizeable enough market. The same is now being said of some of the key renewables. And yet if we were to apply the same focus to new energy as we have to communications technologies, the costs may reduce much faster than has been the case with solar. In addition, the ability of economies to innovate is key to their future growth.
Finally, since renewable energy is highly capital intensive and running costs generally low, we should reduce the burden on current bill and taxpayers by borrowing to pay for energy infrastructure. Lest this should be dismissed as barking mad at a time when deficit reduction is the only game in town, then note that it is not only think tank wonks that are proposing this, but also avowed capitalists.
Faced with the green energy backlash, we can bury our heads in the sand, continue to incant the mantras about the long term risks of climate change or face up to the energy challenge and acknowledge that while most people are not in doubt about climate change, neither are they likely to prioritise spending money on climate change policy while their incomes fall.
An earlier version of this article was published on the Liberal Conspiracy blog.