Andrew Montford: The hidden cost of Net Zero
Do politicians have any idea of where they are taking us? Or does their thinking on energy policy only extend to posturing and pandering to environmental pressure groups?
“We cannot allow debt to keep rising’, the Chancellor said to Parliament last week, repeatedly emphasising the need to ‘level’ with the public about the size of the national debt. Strange then that just days later it was revealed that ministers have been doing the opposite when it comes to the costs of the fashionable cause of ‘Net Zero’. Instead government officials deliberately hid ‘more realistic’ estimates which showed Net Zero would cost billions more than publicised, while agreeing amongst themselves that the predicted costs were ‘highly uncertain’.
These revelations came about after the Treasury was finally defeated in a two-year battle to prevent me seeing documents I’d requested under the Freedom of Information Act. I’d asked for the calculations behind their claim that the cost of decarbonising the UK economy was going to be around £1 trillion.
In the event, after two years, they eventually handed over what was essentially a short memo, discussing two competing estimates of the cost, one from the Department for Business Enterprise and Industrial Strategy (BEIS) and the other from the Committee on Climate Change (CCC).
The amateurishness of the Treasury analysis is extraordinary: a few figures are jotted down, as if on the back of an envelope, and a crude graph is sketched out, after which a picture to present to the public is decided on.
But more importantly, the memo appears to show that the Treasury set out to deceive the public. The mandarins involved felt that the higher BEIS estimate was more credible than the lower figure from the CCC, but shamefully decided to publicise the CCC number anyway.
This kind of behaviour by Whitehall officials has become all too common, but the public may not yet be aware of the extent of the deception regarding Net Zero. The two competing estimates were in the vicinity of £1 trillion pounds, give or a take a few hundred billion here or there. But a moment’s reflection shows that this cannot even be close to the true cost. For example, the Energy Technologies Institute estimates that retrofitting insulation to the UK housing stock will cost in excess of £2 trillion on its own. And you need to decarbonise transport, the power generation system, industry and agriculture too.
At GWPF, where I work, analysts have been building up a more realistic picture of just how much you are going to be required to fork out, and we’ve already reached a total over £3 trillion – or more than £100,000 per household. By the time we are done, it may well be half as much again.
Do you have £150,000 to spare? Coming in the wake of the pandemic, I’m pretty sure most people will not. Forcing taxpayers and consumers to spend sums like this seems the height of economic and social foolishness. To do so only to deliver a world in which you will not know from one moment to the next whether there will be any energy to heat your home or even to keep the lights on defies comprehension.