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“Climate-Industrial Complex” Wasting £100 Billion And Shutting Down Debate – Warns Lilley

March 5, 2018

By Paul Homewood

 

Former Trade and Industry Minister, Peter Lilley warns that vested interests in the renewables industry, politicians of all parties, the bureaucracy and academia have together largely suppressed debate about their reckless waste of public money exposed by the government’s own Review of the Cost of Energy by Dieter Helm.

In a paper published by the Global Warming Policy Foundation, Peter Lilley highlights Professor Dieter Helm’s devastating critique, outlined in the Cost of Energy Review which was commissioned by the government. “Helm shows that the Climate Change Act objective of cutting emissions of carbon dioxide could have been met for a fraction of the £100 billion so far committed, which has already raised the cost of energy by 20%.”

Lilley argues that, even more significant than the reckless waste of public money exposed by Professor Helm is the success of the vested interests – industrial, political, bureaucratic and academic – in dampening any debate about it. “Normally waste on this scale would cause an outcry in Parliament and elsewhere. But the vested interests simply damned Helm’s review with faint praise and consigned it to oblivion.”

It is evidence, Lilley claims, that President Eisenhower’s famous warning against the power of not just the ‘military-industrial complex’ but also similar combinations in areas of civil policy is coming true. “As Eisenhower presciently warned: ‘…a government contract becomes virtually a substitute for intellectual curiosity…The prospect of domination of the nation’s scholars by Federal employment, project allocations, and the power of money is ever present and is gravely to be regarded’. We are seeing the emergence in the UK of a powerful ‘climate-industrial complex’”.

“Moreover, if the climate-industrial complex can show such reckless disregard for basic economic truths, there is a danger that they may be equally careless in exaggerating the risks arising from global warming science (the basic truth of which, as a scientist, I entirely accept). Most scientists remain scrupulously objective in their own work. But they know it is more than their career is worth to question exaggerated claims others may make of the scale, speed or impact of global warming. So, alarmist claims go unchallenged while evidence that we could adapt to global warming rather than try to prevent it is played down.”

 

 

The full paper is below:

 

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THE HELM REVIEW OF ENERGY COSTS

Lessons to be Learned

The dogs that didn’t bark

Sherlock Holmes was right. The most important clue is often ‘the dog that did not bark in the night’.

So, when the government published a report showing that its own policy has wasted the best part of £100 billion and rising, yet the guard dogs of Parliament, the hounds of the Opposition and the mongrels of the media let it pass without so much as a whimper, we have to ask: ‘why didn’t the dogs bark?

Debate rages about whether it is worth spending £40 billion to leave the EU, or £50 billion on HS2 to shorten journeys to Birmingham by 20 minutes. Yet when Professor Dieter Helm, one of our most respected energy economists, revealed that the government could achieve its target to reduce carbon emissions for a fraction of the £100 billion it has already committed, there was a deafening silence.

It is not as if Dieter Helm is a climate sceptic. Far from it. He shares the concerns about global warming enshrined in the Climate Change Act, which requires British governments to reduce emissions of carbon dioxide by 80% by 2050. His review was commissioned by the government itself to examine how this target ‘can be met in the power sector at minimum cost and without imposing further costs on the exchequer’.

By any standards it is an exemplary study – lucid, logically coherent, original and devastating in its conclusions. One does not have to accept all its analysis or recommendations to recognise that it is an outstanding contribution to policymaking.

Helm sums up why the policy of successive governments has been so unnecessarily costly in a single pithy phrase, which may also explain why his report has met such a comprehensive ‘ignoral’. Governments, Helm reminds us, are not good at picking winners – ‘unfortunately, losers are good at picking governments’. Rather than leaving the market to find the most cost-efficientway of reducing emissions, successive Labour, coalition and Conservative ministers have all taken it upon themselves to select and subsidise specific technologies. So, his phrase indicts as either losers or gullible, the whole subsidised renewables industry along with the politicians of all parties and their officials who picked or ‘were picked by’ them. No wonder they all combined to consign his review to oblivion and almost no-one had an interest in sounding the alarm.

Moreover, governments have not only subsidised research and development (something which Helm supports) or a pilot plant in each technology. Instead, they have financed largescale deployment of immature technologies. And they did so by awarding each technology a price for the electricity it generates high enough to make it profitable, then guaranteeing that price, indexed to inflation, usually for 15 years. Needless to say, the only people who could advise civil servants on the price required to make each technology profitable were the businesses backing that technology!

So, the strategy provided a field day for uncompetitive businesses. In Helm’s words: ‘inevitably – as in most such picking-winners strategies – the results end up being vulnerable to lobbying, to the general detriment of household and industrial customers’.

It also created a playing field for amateur political and civil service enthusiasts for each technology. Amateurism and lobbying combined so that: ‘Government started out with 1 some of the most expensive technologies first, and it could be argued that since then it has at times been exploring even more expensive options’.

Helm’s central proposal is to return decision-making to the discipline of the market, wherever possible. He recommends setting a carbon price (a tax on carbon dioxide emissions reflecting the environmental damage they are expected to cause) and then letting the best technologies prevail. He believes that, had we done so, there would initially have been a further shift from coal to gas, which emits only half as much carbon dioxide, while more efficient versions of wind, solar, other renewables and storage were being developed.

The universal excuse for going straight to full-scale deployment of immature wind and solar technologies is that this was necessary to bring down costs. Yet most new technologies – computers, mobile phones, gas turbines and, perhaps most telling, fracking – have rapidly reduced their costs without governments subsidising large-scale deployment. Making it profitable to deploy immature forms of wind and solar may have slowed, rather than accelerated, cost reductions.

We are simultaneously assured that wind and solar are, or soon will be, competitive with fossil fuels but that ending their subsidies would be disastrous. Recently, the renewables industry has claimed that the winning bids by two planned offshore wind farms prove costs have fallen dramatically. In fact, this drop in prices follows the switch from the government setting the price for energy from each renewable source to using auctions to set the price. It reveals the extraordinary scale of rents and/or inefficiency under the old bureaucratic system. Nobody has identified a sudden breakthrough in windmill technology that has halved costs since 2015.3 Helm recommends more widespread use of auctions, to the dismay of the vested interests.

Because Britain has installed so much high-cost capacity, we are not only committed to pay high prices for up to fifteen years, we have also reduced the scope for installing additional intermittent renewable capacity once costs do become genuinely competitive with fossil fuel generation.

Moreover, the more intermittent capacity we install, the greater the cost of the backup ‘firm’ capacity needed for when wind does not blow or the sun shine. The renewables lobby likes to ignore that additional cost when they claim that renewables have reached ‘grid parity’. Helm proposes to deal with that by requiring renewables to bid on an ‘equivalent firm power basis’ – in other words, they must contract with a generator or storage company able to provide electricity when there is no wind or sun.

In short, Helm takes on all the vested interests – not just commercial, but bureaucratic, political and academic – who are implicated in the existing systemof subsidies and intervention. His proposals would erode their rents, undermine their roles and destroy their credibility. No wonder they damned his review with faint praise before consigning it to oblivion.

 

The climate-industrial complex

In his farewell address to the nation in 1961, President Eisenhower famously warned of a military-industrial complex that might gain unwarranted influence. But in the same speech he also pointed to a wider danger: that ‘public policy could itself become the captive of a scientific-technological elite’.

Half a century on, it seems clear that our public policy has been captured by a ‘climateindustrial complex’. In the field of economics, it distorts the truth, closing ranks and ignoring or distort dissent when its failures are brought to light. It justifies the squandering of 2 astronomical sums of money – waste that has already added 20% to the energy costs of households and industry.

If it can be so reckless about the economics of global warming, is it not just possible that it may be exaggerating the dangers of global warming on which the whole case depends? As Eisenhower spelt out: . .

a government contract becomes virtually a substitute for intellectual curiosity. . .The prospect of domination of the nation’s scholars by Federal employment, project allocations, and the power of money is ever present and is gravely to be regarded.

Having studied physics at Cambridge, I entirely accept the science of global warming: double the amount of carbon dioxide in the atmosphere and the direct effect will raise the average temperature by about 1◦C. But how much that will be amplified or dampened by clouds, water vapour, ice loss and other factors is far less certain. Indeed, the most recent IPCC report was for the first time unable to agree a most likely estimate of the overall effect, but did reduce the lower end of the likely range. Significantly, neither of those points were included in the Summary for Policymakers – presumably because the authors felt it their duty to report only facts that would stiffen policymakers’ resolve to tackle global warming. Most scientists remain scrupulously objective in their own work. But they know it is more than their career is worth to question exaggerated claims others may make of the scale, speed or impact of global warming. To adapt Upton Sinclair: ‘It is difficult to get someone to be critical of something if his salary depends on taking it for granted’. So, alarmist claims go unchallenged while evidence that we could adapt to global warming rather than try to prevent it is played down.

Dieter Helm exposed the fact that billions of pounds of public money have been wasted on renewables schemes, yet the climate-industrial complex has shrugged him off with barely a glance. It is hard not to suspect that their flagrant disregard for sound economics may be mirrored in their approach to the science.

 https://www.thegwpf.com/climate-industrial-complex-wasting-100-billion-and-shutting-down-debate-warns-lilley/

 

As I have long pointed out, this is rather a case of shutting the stable door. Unfortunately we are now lumbered with paying tens of billions in subsidies in coming years, both for existing existing renewable projects, and those contracted to come on stream in the next five years. And that’s not to mention Hinkley Point!

Helm’s suggestion was that the exchequer should take this cost on board, and recover it via general taxation instead of through energy bills. Unsurprisingly that has gone down like a lead balloon.

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22 Comments
  1. March 5, 2018 4:42 pm

    The only proper scientists in the House of Commons (Peter Lilley and Graham Stringer) have been, and still are, totally ignored by the establishment when it comes to “climate change” and energy policy. I wonder why that is?

    One thing that we can hope for is that most of the renewable energy generators that have been installed have performance that rapidly degrades and have a shorter than predicted lifetime.

    • TinyCO2 permalink
      March 5, 2018 5:01 pm

      Because on all subjects the MPs are amateurs pretending to be intelligent and informed adults. However they act like giddy schoolgirls choosing nail varnish they can’t afford. By the time everyone realises that they were messing about they’ve done a runner. Only to be replaced by the next load of giggling idiots. Who wants to listen to grownups like Stringer and Lilley?

      • Paddy permalink
        March 6, 2018 7:28 am

        I think the Civil Servants must bear some responsibility. The Pollies just do what the CS advise.

  2. Robin permalink
    March 5, 2018 5:17 pm

    The lunatics took over the Houses of Parliament asylum some time ago. A combined lack of both commercial & scientific knowledge, allied to a desire for personal power is a recipe for disaster

  3. Bitter@twisted permalink
    March 5, 2018 5:41 pm

    Professor Helm’s report is a damning indictment of the virtue-signaling idiots who purport to represent us.
    Repeal the ruinous Climate Change Act.

  4. Ian Magness permalink
    March 5, 2018 5:52 pm

    This is a brilliant paper and makes a number of really important points, not least about our politicians and relying on unproven, underdeveloped but nevertheless incredibly expensive technologies.
    Why of why, however, did Lilley have to throw the warmists the following bone which could come back to haunt him and the GWPF:
    “Having studied physics at Cambridge, I entirely accept the science of global warming: double the amount of carbon dioxide in the atmosphere and the direct effect will raise the average temperature by about 1◦C.”
    Yes, I know that was a huge simplification and indeed he went on to state that there could be variations due to feedbacks and similar but it’s the initial statement that jumps out of the page. Furthermore I, like many other science trained people that have now spent considerable time studying the subject simply don’t agree with that concept. You can discuss this until the cows come home and get into ever-increasing complexity but, at the end of the day, if the statement was true, the models would be predicting our temperatures much more closely than they actually have been.
    If we are to win the whole argument and consign the AGW meme to the dustbin of history then, yes, we need to show, as Mr Lilley has done so eloquently, how stupid the expenditures are for the potential gains. However, we also need to refute what is clearly dreadful science (and by that I include everything from CO2’s part in the greenhouse effect through coral bleaching to starving polar bears and so on). This needs to be done in a way in which the general public (not just those that studied Natural Sciences at Cambridge) can and will grasp. In this context, using words like “I entirely accept the science of global warming” isn’t helpful at all.

    • ronhave permalink
      March 5, 2018 6:11 pm

      Magnus has it exactly right. In addition to physics, Helm should have taken a course in elementary statistics. Then he would realize that there is no unmistakable signal that atmospheric CO2 has any effect on climate whatsoever.

      • jim permalink
        March 5, 2018 7:01 pm

        The CET record, the longest by far in the world, even tough it has been tampered with, still shows no, zilch, increase in summer maximum temperatures. There is a slight increase in winter nightime minimums which leads to a slight increase in averages. I contend any increase in winter minimums is due to ever increasing density of human habiitation , intensive farming and 24/7 lifestyles. Unless these factors can be shown to be neutral, any costly investigation into more exotic contributory factors should be ignored.
        Yes slight avarage increases are man-made, but not because of a trace gas, but because there are more of us, and our societies are increasingly active 24/7. We are causing an outbreak of mildness.
        I totally agree that Lilley and Helm should not pander to to mob, by including supine comments about AGW. A spade should be called a spade.

    • dennisambler permalink
      March 6, 2018 2:50 pm

      I agree. The use of their language gives them the game.

  5. George Lawson permalink
    March 5, 2018 5:59 pm

    It would be interesting to create a list of the MPs, scientists, businesses and others involved who have benefited so massively from the GW lies, and establish how much each of them has made from this utterly disgraceful and deplorable global warming scam, a scam which is having such a marked effect on the economy of this country. History will prove how parliament and the public were misled and lied to by the collective few whose priorities were purely self interest, and how both political parties allowed such squandering of the country’s finances on a totally false claims that have benefited the few to the extent of £billions. These people should be exposed for us all to see who the culprits are. How can we do this?

  6. March 5, 2018 7:12 pm

    The M.P. have cosseted existences unlike most of the rest of us. Cast iron Pensions based on 4Oths of their salaries and a nice little earner in the house of lords or on a public body when they retire. The Kinnocks apparently struggle along on combined parliamentary/commission pensions in excess of 180Thou for example. In the meantime about 25000 to 30000 pensioners die due to the effects of the cold and this will get worse as the insanity involved with the hugely expensive green energy and nuclear schemes kick in and push costs up even higher. What is happening can only be described as the madness of the mad!

    • Jack Broughton permalink
      March 5, 2018 8:03 pm

      Rather sad, but Neil Kinnock originated the “Me – now” catch-phrase. I think that he probably meant it once. May really believes in the JAMs too. We are truly ruled by morons.

  7. Andrew permalink
    March 5, 2018 7:23 pm

    George- I totally agree. The ruinous climate change act was voted through the commons with little debate and only five votes against. What a disgrace! It’s fairly safe to assume that all the politicians are guilty unless they can prove otherwise (I believe in innocent until proven guilty but this is an exception). Furthermore, if they are incapable of coherent thought on climate change when the cost of getting it wrong is so enormous, then how can they be trusted on anything. In fact they seem to be proving themselves unworthy of our trust a lot nowadays.

  8. Nigel S permalink
    March 5, 2018 10:05 pm

    This comment by Helm on the various unreliables scams is brilliant, governments are bad at picking winners but ‘unfortunately, losers are good at picking governments’. One to savour!

  9. March 6, 2018 7:45 am

    “Moreover, if the climate-industrial complex can show such reckless disregard for basic economic truths, there is a danger that they may be equally careless in exaggerating the risks arising from global warming science (the basic truth of which, as a scientist, I entirely accept). ”
    And, with the bracketed qualifier, Lilley thereby blows his case out of the water! Simply staggering.

    • dennisambler permalink
      March 6, 2018 2:52 pm

      In trying not to be labelled a “denier” he, as you say, blows the whole thing out of the water.

  10. Vernon E permalink
    March 6, 2018 9:22 am

    I agree with Ian. Why on earth did Lilley gift that concession to the warmists? It will quoted ad nauseum and un-does all the good that Helms’s paper might have brought. Its an even worse error since, as others have pointed out, there is not one shred of forensic evidence that traces of CO2 influence climate. Bad, Bad, Bad. Own goal.

  11. Vernon E permalink
    March 6, 2018 9:25 am

    Lilley’s idiotic gift to the warmists will be quoted ad nauseum. Own goal.

  12. March 7, 2018 10:02 am

    I didn’t study physics at Cambridge, I studied climate, at home.

    Intrigued by the ferocious debates, I watched a few youtubes & bought a few books.

    A few conclusions: CO2 ALWAYS rises AFTER temperatures rise.
    Rising CO2 levels are an EFFECT of rising temperatures, not a CAUSE.

    The major source of CO2 in our atmosphere is warming oceans outgassing in the tropics, ~57%. other sources include rotting vegetation & volcanoes. Animals alone contribute 25 times more CO2 to our atmosphere than man does.
    Of the CO2 content of our atmosphere, 95%+ is produced by nature, less than 4% by man.

    Of the greenhouse effect, 95% + is produced by water H2O in clouds, less than 4% by CO2.
    This produces, IMHO, a probable net cooling effect daytime as the Sun’s heat is reflected back to space, & a probable net warming effect night times as Earths heat is reflected (partly) back down.

    Overall, is a possible 1 degC global temperature rise something to worry about? NO.
    The Medieval, Minoan & Roman warm periods were times of plenty.

    To expect to influence climate via regulation of man’s output of CO2 is the sheerest idiocy.

    John Doran.

  13. March 7, 2018 10:34 am

    Climate can be defined (oversimplified) as the distribution of the Sun’s heat from the tropics around our globe. Our oceans absorb 22 times more heat than our atmosphere, & transport this heat via currents. EG: the gulf stream. Are oceans 22 times more important to our climate than our atmosphere?

    Climate can be defined as a complex, linked, non-linear chaotic system, this is the IPCC’s own definition. In short, there are many influences & we do not yet know how they inter-react.
    The IPCC, IMHO, is a fraud factory, a con job. The Summary for Policymakers is a political, not scientific process. I would go so far as to call it a perversion of the scientific process.

    To ignore Milankovich cycles, volcanoes, the evolving Sun, the evolving & growing Earth, our passage through the arms of the Milky Way, the Earths’ & Suns’ varying magnetic fields, to name but a few climate factors, & concentrate on man-made CO2 as the main climate driver, is more than idiocy: it’s lunacy. It’s lunacy at vast cost. Climatologist Dr. Tim Ball likens this lunacy to concentrating on one wheel nut on one rear wheel when assessing a car. drtimball.com

    John Doran.

  14. March 7, 2018 11:19 am

    For me, the climate change lunacy is proof positive that our political process is broke.
    It’s not fit for purpose.
    In theory, our “democratic” system should be working toward the greater good of the greatest number. It is not. It is serving special interests & the landed gentry at the expense of the working & middle classes.
    There are these paths ahead:
    One is vast Parliamentary reform. If Peter Lilley is the nearest thing we have to competence & sanity, this is not going to happen.
    Two is the vast depopulation planned in UN agenda 21, leaving a world of Lords & very few serfs. This is where we are trending now: The Hunger Games is where they’re herding us.
    All behind the Green Cloak of Environmentalism, of course.
    Three is a revolution, God forbid.
    Four is Putin drags the West back to some sort of sanity?

    Two books I reckon should be compulsory reading for our dimwit herd creature MPs:
    Human Caused Global Warming, the biggest deception in history, Dr. Tim Ball.
    A simple primer, suitable as a first step.
    Heaven and Earth global warming: the missing science, Prof. Ian Plimer.
    The formidable Lord Christopher Monckton has an afterword to this excellent & comprehensive work.
    Both are in plain English, aimed at the layman. Tim Ball’s book has recommended further reading, Ian Plimer’s has over 2000 references to historical & scientific literature.

    Tim Ball does not know about the biggest deception, nor do most of our MPs: money created out of thin air, as debt to enslave us serfs & to the vast enrichment & empowerment of the International Banksters driving the climate scam.

    John Doran.

    PS: As Hansen & Wirth were conning Congress, June 1988, to kickstart the whole fiasco, satellites were beginning to notice that increased CO2 levels were benefiting the biosphere.
    Matt Ridley has a Youtube on fossil fuels greening the planet.
    The irony is massive.

    John Doran.

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