By Paul Homewood
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Peter Lilley initiated a debate in the House of Lords yesterday, to discuss the impact of the climate agenda on jobs and growth.
This was the crux of his speech:
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“It is hard to overstate how crucial cheap energy is for economic growth and prosperity. The quadrupling of oil prices in 1974 ended three decades of rapid growth in western economies. Energy price rises have invariably been followed by a slowdown in growth. On the other hand, thanks to shale oil and gas in America, that country has had cheaper energy and grown faster than other western economies, and China’s extraordinary growth has been fuelled by cheap coal.
Let me start with a few facts about climate change and the climate agenda impacts. First, Britain has reduced its territorial emissions of CO2 more than any other major economy and they are now back to the level they were in 1879. Secondly, Britain has more offshore wind power than any other country bar China, not to mention its onshore wind, solar and bio energy.
Thirdly, despite or because of this, British industry pays the highest electricity prices in Europe. They doubled in real terms over the two decades up to the start of the Ukraine war, even though real gas prices remained largely unchanged over that period.
Fourthly, we have already lost most of our aluminium industry and are losing our primary steel-making capacity and, with it, thousands of jobs. We are seeing the Grangemouth refinery turning into an import terminal and other British refineries under threat. We import an increasing proportion of energy-intensive goods, such as cement and bricks.
Fifthly, when our manufacturing industry moves abroad, it does not reduce global emissions at all—far from it. We now import many carbon-intensive products, so the reduction in Britain’s carbon footprint is only 36%, much less than the near halving of our reported territorial emissions.
Finally, the Government propose to accelerate the move to net zero regardless of cost, to prevent new North Sea exploration and instead import oil and gas, and to ignore or deny the impact this will have on our energy costs, growth and jobs.
This is an unusually significant debate because, as far as I can tell, it is the first time that Parliament has formally debated the impact on jobs, growth and prosperity of our decision to decarbonise our economy. Our failure to do so has been part of a collective institutional failure by Governments of all parties, both Houses of Parliament, the BBC, the Climate Change Committee and other public bodies to permit or promote an informed debate on the economic costs and benefits of net zero.
Costs were never discussed during the passage of the Climate Change Act in 2008, nor during the 90-minute debate committing us to net zero in 2019. It is extraordinary that we still have no official cost-benefit analysis of net zero, five years after embarking on the project.”
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He goes on to eviscerate the repeated claims about the so-called advantages of pursuing Net Zero, and how debate has been shut down about the downsides. I was tickled by this particular comment:
“The Industry Minister, the noble Lord, Lord Vallance, who pursued the Sue Gray route to the upper echelons of the Labour Party, was given a little section of his own in the Labour manifesto, in which he said that
“by accelerating the transition to clean, homegrown energy”
we will not only
“end the era of high energy bills”
but be
“helping ourselves and exporting our solutions worldwide. But if we choose to go slowly, others will provide the answers, and ultimately we’ll end up buying these solutions rather than selling them”.
Where has he been for the past 20 years? Far from choosing to go slowly, we have outpaced other countries, but we have had to buy the solutions from abroad. Imports of renewable technologies vastly exceed our exports. Foreign suppliers have finally begun to make wind vanes in this country and assemble generators here, which is welcome, but they are largely for our fields, and those companies are not going to make us an exporter. The only turbines we export are gas turbines, which we are phasing out and urging others to do likewise. The only area where we might take the lead in developing a new industry is small nuclear, which I persuaded the Energy and Climate Change Committee to back a decade ago. I hope this Government will give that project more welly than my Government did.”
We have had many debates like this in the past, and they have all been equally depressing. The Minister regularly fails to address any of the real issues raised, and instead reels off the usual Net Zero mantra. Meanwhile, members from all parties queue up to pat him (and themselves) on the back for saving the planet. Having said that, there were two very good contributions from Lord Frost and Lord Strathcarron.
This time the Minister responsible was Lord Hunt, and there was no change. He spent most of his response in telling us that we need to do Net Zero to save the world from a climate catastrophe, while promising “good-quality jobs”.
Nowhere in his answer was there any mention of the number of jobs already lost or put at risk. No mention of the cost of Net Zero. And no mention of the fact that while UK emissions have dropped by 235 mt since 2008. the rest of the world’s are now 4950 mt higher.
Lord Lilley gave a robust summation to close the debate:
My Lords, I am grateful to everybody who has made fantastic contributions to this excellent debate. I pay particular tribute to the Government spokesman, the noble Lord, Lord Hunt, whom we have just heard. His response to everybody and everything that was said was one of the most fair-minded and constructive that I have heard, not least in fairly representing what I was trying to say—though I am not accusing him of agreeing with me.
I want also to congratulate my noble friend Lady May of Maidenhead on an outstanding maiden speech. It was noteless; it was witty; it was compassionate. We are aware, obviously, of her other great legacy on modern slavery. The noble Lord, Lord Willetts, reminded us of her concern for the just about managing in our own country, and she emphasised her concern for the poorest, who are the greatest victims of climate disasters—when you are hit by a flood, it does not matter to you whether they are more frequent than floods in the past; they are still a disaster. But the reason the poor are vulnerable is that they are poor, and the reason that they are poor is that they do not have the access to cheap energy that makes us rich. If we deprive them of access to cheap and affordable energy they will remain poorer for longer. Even if we in this country think that we can afford excessively high energy costs, we should not try to impose them on the poor and slow down their growth.
I next thank the noble Lord, Lord Deben, who offered my greatest support for what I had to say, since, because he could not refute a word that I had said, he chose to criticise things that I had not said. He criticised me for saying, allegedly, that we should not make any contribution on this front. What I actually said was:
“I accept that we must be prepared to make our proportionate contribution”.
He went on to say that I had said something in Cabinet under Mrs Thatcher, which is simply untrue. I remind him of the exchange we once had in John Major’s Cabinet, which was not about this but about statistics, when he was wrong.
The noble Lord did not respond to the points about why he needed to take costly legal action to prevent publication of the analysis that his committee had done on the cost of climate change avoidance in 2050. My general view is that when people do not want to publish facts it is because they think the facts are rather weak. I assume that is why he did not refer to them.
On the general issue of costs, with the exception of the noble Lord, Lord Hunt, almost nobody who was enthusiastic for doing more and spending more and who generally goes around saying that we can do that in a costless fashion commented on the costs I gave. None of them referred to the fact that we have the highest costs of electricity for our industry of any country. One can only assume again that they are embarrassed by the facts. Likewise, when it came to new industries, apart from small nuclear, which I mentioned and have advocated for a long time, nobody gave detail of how these industries are going to generate new prosperity when we have doubled the amount of onshore wind, trebled the amount of offshore wind and quadrupled the amount of solar or whatever it is, when that has not happened so far.
There were a couple of important arguments that it is important for me to address because they go to the heart of the issue. One was on the issue of external costs, which was raised by the noble Baroness, Lady Bennett, and the noble Lords, Lord Willetts and Lord Browne. Theirs was the logical response to what I am putting forward, which is to say: “Yes, you’ve got to balance the costs of doing something against the damage that would be done if you don’t, and the logical way to do that is a carbon tax”. If we take the American Government’s estimates, for example, which say that the carbon tax should be $51 per tonne, which is about the equivalent to $10 per megawatt hour, it does not make any difference to the fact that renewables would still be uneconomic in this country.
Then came the most difficult issue, which people who take my position have to face up to, and that is the threat of existential crisis. If continuing to do nothing—I am not proposing that we do nothing—were likely to result in the extinction of the human race, or even its immiseration, almost no costs would be too great to avoid it. I accept that.
I put down a Question some while ago to the Government asking whether they knew of any peer-reviewed science, or science produced by the Intergovernmental Panel on Climate Change—whose
job it is to consider the science—which forecasts that, if we do nothing over the coming centuries, it will lead to the extinction of the human race or even its immiseration. They said that no, there was no such peer-reviewed science, so those who invoke it are invoking something that is not peer-reviewed science, although that does not mean to say that it is wrong. Some things can turn out to be right that have not yet got through the peer review process. But let us not pretend that we are dealing with a threat that scientists have declared to be existential—they have not.
We are left with the central core of the debate: should we have an honest discussion about the costs and benefits of pursuing the path of net zero? I am glad to say that the Church was on my side on that front—that we want an honest debate. We can do that only if the Government and bodies such as the CCC, the National Grid and the Royal Society have the honesty and integrity to admit that about their information. The Royal Society—or the author I cited—has admitted that his figures were underestimates. We can have that debate only if we have that information from those sources in an unbiased way rather than in a campaigning way. I am grateful to everybody for contributing to the beginning of that debate for the first time in Parliament.