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Labour’s Decarbonisation Plan

February 19, 2019

By Paul Homewood

 

 

 

https://www.theguardian.com/environment/2019/feb/12/labour-plan-decarbonise-uk-green-jobs-climate-crisis

 

 

Rebecca Long-Bailey has moved forward (or backwards) on Labour’s plans to decarbonise the UK.

The woefully inadequate Long-Bailey has only got the job of shadow business secretary because she is a hard left acolyte of Jeremy Corbyn, for whom most of his MPs refuse to work for.

Her latest move is to gather together trade unionists, industry leaders, academics, engineers and public institutions to look at the detail. No doubt this will be the usual bunch of renewable lobbyists, paid up members of the green blob and marxist academics.

But I have come across a document she put out last September, which offers some insights into how Labour will start to try to meet its manifesto promise that 60% of UK energy would be low carbon by 2030.

 

 

 

 

It consists of four strands:

Currently there is offshore capacity of 8 GW, due to rise to 14 GW by 2025.

The first, very basic question is how much subsidy is Labour prepared to pay out to obtain this investment.

Current wholesale prices for electricity are £55/MWh, and the official government projections see this coming down to £44/MWh by 2035, at current prices.

By contrast, the lowest strike price agreed via CfDs for offshore wind so far is £63.66/MWh.

Nobody is prepared to build new offshore wind farms at the moment without a guaranteed price well above current market prices, so the only way Labour can achieve their goal is to massively increase subsidies.

Assuming a subsidy of £20/MWh, the extra 38 GW required under this plan would add £2.7bn to the £14.2bn already budgeted for by the current government.

 

 

 

 

Current onshore wind capacity is 13 GW, so this plan would need to more than double what we have.

Again, this raises the question of how much extra subsidy is Labour prepared to pay out.

Since subsidy schemes for onshore were ended, new investment in onshore wind has dried up to a trickle. So how will Labour encourage this investment to return, or will it finance it direct from taxation? And who will pay for excess costs – bill payers or taxpayers?

 

 

Labour wants to raise solar capacity from 13 GW to 35 GW.

But again, new solar build has dried up since subsidies stopped.

Long-Bailey witters on about the falling costs of solar panels, but developers would be queuing up now to build new solar farms if they could make money.

The plan also talks about expanding rooftop solar. But this begs the question of who pays. Will government pay for panels on a privately owned house, or company offices? Clearly not. So how will they persuade private property owners to do it. Government has been trying for years to encourage this via the Green Deal, but the uptake has been distinctly unimpressive, simply because the economics don’t stack up.

Will Labour then resurrect the obscene incentives, previously offered through FITs, which mainly benefit wealthy people, but have to be paid largely by the poor?

She also seems to be totally unaware that solar power runs at little more than 1% of capacity during winter months, when power is at a premium. There is little point in wasting tens of billions of pounds building up solar capacity, which you can only use in summer when you don’t need it, but is not available in winter when you really do.

 

 

What happens when there’s too much wind and sun?

But on top of the question of subsidies, is a much more fundamental one.

Adding offshore, onshore and solar together from her plan, we could expect annual generation of 286 TWh, about 85% of total generation currently. This would equate to an average of 33 GW.

Because of the huge weather related variations in wind and solar outputs, there will be many times when there is far more wind and sun generated power than the grid can absorb. This would certainly be the case in summer.

Even the Committee on Climate Change recognises this problem. In its modelling, it works on a maximum wind/solar capacity of 87 GW, much less than Labour’s 117 GW.

But even then, the CCC calculate that there will be a hell of a lot of surplus power in the system, when wind, solar and nuclear output exceed demand. Under Long-Bailey’s plan, such surplus would be immense.

CCC 5th Carbon Budget

So just what does Long-Bailey propose to do with this excess electricity? If it is just thrown away, the unit costs for the power we do actually use becomes much more expensive.

TRANSLATION- somebody has to pay the cost of this.

If we offload the surplus onto, say, Norway (assuming we have tens of GW of interconnector capacity, which does not exist), are they going to pay full price for it? Of course not.

Even the CCC have realised that there is a limit to how much intermittent capacity the grid can absorb. Apparently, Long-Bailey, whose only experience outside politics is as a solicitor, has not grasped these basic concepts, which should be obvious to anyone with a bit of knowledge of the subject.

 

Unfortunately her plan does not get any better.

She plans to cut demand for domestic heating by 25%, by upgrading 12m homes to the highest energy efficiency standards:

As is the case throughout her plan, there is no mention of cost. But we do have some clues.

She talks about 160,000 new jobs created. At, say, £50,000 each (incl NI, pension contributions, and miscellaneous costs such as travel), we are looking at a cost of £8bn a year. You could easily double this when adding on material costs, such as new windows, insulation etc.

So where does she propose to get £16bn from each year? That would equate to £16k for each of those 12m homes, when spread over 12 years (ie three Parliaments).

And how much would each household save in energy? Probably no more than a couple of hundred pounds a year. Yet the very same households are already paying more than this in green levies.

It would make more sense reducing people’s energy bills, for instance by eliminating VAT, than embarking on an unaffordable programme of energy efficiency improvements.

And what is certain is that if such a programme was organised by government, it would cost twice as much and take twice as long as it would otherwise.

Finally we go back to the question of who pays? Many of these 12m homes are owner occupied, so will owners benefit from government largesse? Or will they be forced to pay the cost, money which they are unlikely to have.

Quite apart from these issues, it is unlikely that all of the energy savings projected will come to pass. Most people who invest in insulation take advantage of warmer homes, and not just reduced bills. Even Long-Bailey talks about “homes that are warmer”. She cannot have it both ways.

Energy savings will only go a small way to meeting Labour’s targets. As far as heating is concerned, 44% of heat demand will need to be made renewable:

The plan makes no mention of how this will be achieved, but it plainly cannot come from electrification. As she admits herself, peak demand for heating six times larger than electricity, which is also much more costly than gas anyway.

This leaves hydrogen. As Lord Oxburgh’s Parliamentary Report has already stated, the only viable way to produce hydrogen is via steam reforming using natural gas.

Even then the costs would be astronomical. Based on estimated costs for a pilot study in Leeds, a national roll out of hydrogen would cost £163bn, plus £11bn a year in running costs.

Jobs and Costs

As noted, Labour’s plan makes no mention of costs anywhere in the document, probably because they assume money grows on trees.

But they do talk about new jobs created, apparently 410,000.

We have heard nonsensical claims like this before from politicians. Remember when Ed Miliband claimed his green revolution would create 400,000 jobs? That was back in 2009. I wonder what happened to them.

But on a more fundamental level, such claims merely display politicians lack of understanding about how economies work.

Put simply, you cannot “create jobs”, as the money to pay for them is taken out of the rest of the economy, particularly when there is no added value.

It also begs the question of just where these bodies are going to come from. After all, there are hardly 410,000 skilled workers sat around unemployed. If these new jobs are to be filled, employees will have to be taken away from other productive sectors of the economy.

Of course, Labour’s policies will probably create many more unemployed workers. But I don’t think a skilled worker at a factory on Merseyside will be particularly happy having to move hundreds of miles in order to take up a new job as a double glazing salesman!

Labour’s plan is here:

Achieving-6025-by-2030-final-version

28 Comments
  1. Gamecock permalink
    February 19, 2019 1:32 pm

    ‘She said a future Labour government would oversee an economic revolution to tackle the climate crisis, using the full power of the state to decarbonise the economy and create hundreds of thousands of green jobs in struggling towns and cities across the UK.’

    The fact that it would be a revolution GUARANTEES it will fail. As Gramsci warned 80 years ago.

  2. A C Osborn permalink
    February 19, 2019 1:39 pm

    Almost as bad as the US Democrats New Green Deal and very similar.

    • February 19, 2019 4:38 pm

      Our excuse is that it’s being led by a 29-year-old whose vast experience in green energy is being a bartender. I’m not sure what the excuse for those whose IQ is supposedly above carrot signing on to the plan.

      • David Wojick permalink
        February 20, 2019 9:48 pm

        At least AOC has a degree in economics, apparently socialist economics. She merely wants a ten year repeat of the WW2 effort. This is crazy of course, but at that level of effort it could actually be done. So in that sense she is not wrong, just nuts. Calling her a bartender masks this reality.

      • February 21, 2019 5:16 pm

        For someone with a degree in economics she seems rather ignorant. Also, she hasn’t worked in her field. The bartender label sticks.

  3. February 19, 2019 1:42 pm

    Great rebuttal
    Where is the Tory party when you need them?

  4. A C Osborn permalink
    February 19, 2019 1:44 pm

    This is almost as bad as the Democrat New Green Deal and is very similar.

  5. Gerry, England permalink
    February 19, 2019 1:44 pm

    It always amazes me that we have all these morons having done PPE degrees and yet have no understanding of the ‘E’. This includes Blue Labour as well as Red. Obviously if a socialist understand economics they can no longer be a socialist as they will understand it is fairyland. In this case, I presume the entry level for solicitors is quite low these days if she became one. Still, the trickle of departures from Corbyn’s antisemites might turn into a flood soon and where will that leave him?

    • A man of no rank permalink
      February 20, 2019 4:47 pm

      Gerry, both Houses of Parliament are stocked out with ‘inumerate wordsmiths’ – a much nicer phrase than morons!
      In their midst is an experienced and honest Labour MP called Dr.Graham Stringer who knows hell of a lot about green fantasies. Wonder why their own expert is not involved in policy making?

  6. February 19, 2019 1:53 pm

    Amazingly all the other major parties, including the Conservatives, will be competing to be even more “green”, with the usual failure to mention cost, except for a comparison with Hinckley C, the gift that keeps giving to the Green Blob.

    There is also a deafening silence on the benefit of all this c**p.

  7. Phoenix44 permalink
    February 19, 2019 1:55 pm

    “Creating” jobs takes jobs out of the economy, which is far more important than money.

    Try a simple example: a small country with ten adults in it has six farmers, one doctor, one teacher, one policeman and one soldier. They decide they want a person to insulate homes – are you going to go without a load of your food,all your health, all your education, what?

    Any person doing any job cannot also be doing another job. Shifting people from a productive job to one less productive makes us all poorer.

  8. February 19, 2019 2:03 pm

    She is very well qualified to be business secretary. She began her working life serving at the shop counter of a pawn shop, an experience that she says “taught her more about the struggles of life than any degree or qualification ever could.” She also worked in call centres, a furniture factory, and as a postwoman before eventually studying politics and sociology at Manchester Metropolitan University before further study to become a solicitor.

    Her knowledge of science and engineering is er, what is the word I am looking for? Non-existent.

  9. Gamecock permalink
    February 19, 2019 2:06 pm

    But Phoenix44, if all are digging the community hole, all will be joyful.*

    The economic illiterate don’t get that jobs are a COST, not a benefit. They brag about ‘creating jobs.’

    *Or else.

  10. February 19, 2019 2:30 pm

    Well left wing policies are mostly like this – Jelly fish. Squishy bubbles with lots of trailing stings in the tail.

  11. BLACK PEARL permalink
    February 19, 2019 2:38 pm

    Without the involvement of the MSM in allowing alternate facts highlighting the costs & fallacy of all this to the currently high proportion of indoctrinated general public (which they appear to block) our future energy production is stuffed.

  12. Ian permalink
    February 19, 2019 4:19 pm

    They clearly haven’t looked into the backlash in thew US:

    https://wattsupwiththat.com/2019/02/13/laborers-international-union-of-north-america-savages-aocs-green-new-deal/

    “It is difficult to take this unrealistic manifesto seriously, but the economic and social devastation it would cause if it moves forward is serious and real.”

  13. February 19, 2019 4:44 pm

    I heard that NYC is converting 23 buildings from incandescent to LED lighting at $1977/apartment. A total of $33 million. Are you sure that the UK cost estimates are in line with actual costs?

    • It doesn't add up... permalink
      February 19, 2019 8:09 pm

      I think we need to know how many Greens it takes to change a light bulb. Must be how they come up with those numbers of jobs generated. They don’t generate much else, after all.

  14. It doesn't add up... permalink
    February 19, 2019 4:59 pm

    So her plans include putting Granny in the freezer (it uses less energy, and provides some heat for her).

    Meanwhile, you can add in the subsides for selling surplus export electricity at very low (or even negative) prices, and the costs of all the extra transmission lines and subsea interconnectors that are supposed to get rid of surpluses (but won’t be able to when there are already surpluses elsewhere for the same reason), and probably a gargantuan bill for batteries that will do nothing to solve the problem either. Still, it would all be part of a Stalinist Five Year Plan. Come to think of it, is it so different from the present plans anyway?

  15. February 19, 2019 5:06 pm

    The jobs they want to create are an extra drain on the wallets of the bill payers, and the expensive power they lead to kills jobs in other industries.

  16. Jon Scott permalink
    February 19, 2019 6:07 pm

    “Unfortunately her plan does not get any better.

    She plans to cut demand for domestic heating by 25%, by upgrading 12m homes to the highest energy efficiency standards:”.

    Call me stupid but IF as the zealots who she believes wholeheartedly to come up with this nonsense are telling us that we are cooking and burning up because of Global Warming then WHY do you need to bother at all with home insulation? Indeed why are there still govt grants for this. A does not follow B!

  17. Chilli permalink
    February 19, 2019 6:55 pm

    Absolute madness from Labour – although it’s little worse than the nutty polcies already being enacted by Clair Perry, Gove and the virtue-signalling Tories. Once you’ve agreed that windmills, solar panels and CO2 taxes are a good thing – then it’s difficult to argue against having more of them. More of a good thing is always better right? The Tories cannot attack Labour’s loony proposals because to do so would be to admit that their own policies are already damaging and were only adopted to signal virtue at bill payer’s expense and curry favour with brainwashed ignoramouses.

    • February 19, 2019 7:58 pm

      It’s a race to the bottom!!

      • Jon Scott permalink
        February 20, 2019 6:39 pm

        And the pious idiots still won’t get it when we just become one more third world country

  18. Svend Ferdinandsen permalink
    February 19, 2019 7:06 pm

    120.000 jobs to produce 52GW, it means 120 jobs to attend a 52 MW generator or 0.5MW/job.They like to to tell how many jobs the green energy gives, but it also tells why it is so expensive.

    • Jon Scott permalink
      February 19, 2019 7:29 pm

      Also do not forget that they are NEVER pulled up on quoting capacity NOT output. Also They NEVER tell about the degradation of the wind turbines over time in respect of their ability to produce elektrikery. Smoke and mirrors and this is all allowing very unscrupulous people who would never be able to compete on a level playing field to become incredibly rich…OFF YOUR BACK

  19. John Palmer permalink
    February 19, 2019 9:10 pm

    She’s the UK’s very own AOC!

  20. M E permalink
    February 19, 2019 11:24 pm

    I have recently found that the economist Thomas Sowell, a professor of economics in the the U S for many years has the answers to most of the questions asked in the replies to this post on the blog. See Youtube Thomas Sowell and choose which interview you wish to enjoy!
    The lack of practical experience in academics is one subject he fulminates on.

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