Eye-wateringly expensive, and promising unreliable energy, decarbonisation is a dangerous daydream
You can almost smell the change in the air. A growing number of influential voices are beginning to ask the questions that everyone has been avoiding for the last few years. Can we really nudge people into accepting net zero –the decarbonisation of the economy? Is it practical? Can we afford it any more? Or will it prove to be the white elephant to end all white elephants?
They are right to be concerned. The bill has already been estimated at £1 trillion pounds – £30,000 for every household in the country – an eye-watering figure that was probably unaffordable even before the pandemic hit. But a moment’s reflection shows that even this number is far too low to be plausible. Although it is a tidy sum, 30 grand doesn’t go far when you are trying to decarbonise. Heating the nation’s homes is a case in point. The cheapest way of doing this is a combination of insulation and replacement of gas-and oil-fired boilers with heat pumps. But a heat pump and ancillary equipment will set the average homeowner back well over £10,000, and retrofitting insulation could cost twice as much.
Once you have converted 30 million homes, your £1 trillion decarbonisation budget is pretty much gone, before even thinking about the cost of decarbonising the electricity generation system, replacing petrol and diesel cars with electric vehicles, installing charging equipment, reinforcing the grid to cope with the extra demand, and weaning industry, freight, transport, shipping and agriculture off fossil fuels. Quite what all this will really cost is anyone’s guess at the moment, but it will certainly be well over £100,000 per household.
Forcing people to spend their own money on that sort of scale is hardly going to be a vote-winner, but then coercion seems to be the order of the day. The Committee on Climate Change – the Government’s advisers on decarbonisation – are urging a ban on sales of inadequately insulated homes. Such a policy would land like a lead balloon in the Tory shires.
And that’s only the start. Decarbonisation’s big secret is that we still have no zero-carbon technology that can balance the electricity grid when it is driven by offshore wind farms. Contrary to common belief, batteries are not even a plausible solution, and hydrogen is so absurdly expensive as to make its use unacceptable.
We are therefore heading for a situation in which the only way to meet supply and demand in a long lull in the wind (like the one we have seen over the past two weeks) will be rationing. That’s what smart meters are for – they will enable grid managers to switch off appliances in your home so that the grid doesn’t collapse. Yes, your home may be cold, and the electric car may sit idle in the drive, but at least the lights haven’t gone out.
It doesn’t have to be like this. A study I helped publish a few years ago showed that an electricity grid powered by nuclear and gas could deliver similar emission reductions to the one we are building, but at a fraction of the cost. New technologies like so-called Allam Cycle gas turbines (essentially a gas-fired power station with built-in carbon capture) could make the system zero-carbon.
But instead, we in the UK will be stuck with vast, unreliable offshore wind farms, which seem to exist mainly to mop up subsidies. It emerged last week that several of our latest offshore installations are taking home a third of a billion pounds in subsidy each year. Every year. The latest and largest, Hornsea One, will soon be sucking up over half a billion pounds of annual subsidy.
We have done the easy bits of net zero – replacing coal with gas made economic sense in its own right. The next steps are going to be harder for Tory canvassers on the doorsteps, particularly in Red Wall seats, where heating bills are high, and the kind of money needed to decarbonise isn’t found down the back of the sofa.