About a fortnight ago, the Tony Blair Institute put out a report explaining the need for an energy strategy reset in the UK. So much, so obvious. I decided to actually read the report to see what they recommend as part of this reset, and whether it makes sense.

The first thing TBI emphasizes is something sceptics have said for a long time. Energy is not a goal in itself. It is a means to an end. The end that it is put to might be quite mad (my way of putting it). Next is that “clean” in an energy context – those are my snark quotes – does not automagically also mean cheap, secure, or capable of powering a modern economy. I would say that the kind of energy compatible with “green” thinking is likely to be none of those things.

There is a certain amount of soft soap at the beginning of the report, as it claims that “Clean Power 2030” has been “implemented with discipline and consistency.” I would say it has been implemented with “desperation” rather than “discipline.” The procedure, to an external observer, has been one of signing up “clean” power wherever it is, whatever the cost, and however useful it is.

Nevertheless, says TBI, we need a reset. But not the sort of reset that a sceptic would dream of. This reset keeps the target of Net Zero 2050 – the impossible target of Net Zero 2050. It replaces the existing short-term goal of “clean” power by 2030 with one of “cheap” power by 2030. Unfortunately, a glance at the velocity of the super-tanker United Kingdom shows that the new goal is no more achievable than the old. Small glimmers of reason do occur here. Any new renewables added must work under “realistic assumptions.” Since that is only possible under conditions that new renewables developments would never agree to, that idea is null, I think (or it disallows most new renewables). We must, says TBI, create an “investible” North Sea. Alas, this is fantasyland too. No-one is going to trust that any U-turns the present shower make are going to last more than ten minutes, so no-one is going to invest in the North Sea, unless they are renewables developers with a cushy contract that cannot easily be escaped from (but see Gordon Hughes). TBI wants innovation to be the target, not deployment. Most types of “clean” energy are resistant to innovation, so this seems a pointless suggestion. Yes, if it is innovation in modular nuclear, which climate alarmist and denier alike ought to be able to get behind. But there are fundamental reasons why straining kinetic energy out of the breeze, or collecting sunbeams, cannot be iterated to utopia.

1. Clean Power 2030 belongs to the world of yesterday

The statistics are familiar to Cliscep readers. TBI restate them here: UK’s energy demand peak was in 2001, and its electricity use is down 25% from 2005 to now. This is in direct contrast to the requirements of the “electrify everything” 2050 Net Zero Utopia. Nevertheless, TBI seem to take the world of Net Zero 2050 and try to work backwards from there. We need more leccy, they say, not only because of the next big thing of AI datacentres, but also because the world of Net Zero 2050 will have to have “decarbonised” heat, transport and industry. The sceptic shrugs here and says we have means to do those things without electricity or Net Zero.

TBI note that renewables are “no longer” getting cheaper, and the system cost is growing. The sceptic says they were never getting cheaper, but that it was easier to absorb the damage when renewables made a smaller proportion of supply. Now we are truly reaching the stage of system revolution where we require two complete systems on the grid.

Energy is state power, according to TBI – implying the need for expansion, not rationing.

These three shifts (need more leccy, renewables cost rising and system costs ditto, and energy nationalism) “invalidate the organising logic” of Clean Power 2030. (Funnily enough, I don’t see them as “shifts” but inherent facts that have been studiously ignored.)

2. Redefining UK’s climate leadership

The sceptic says that the UK does not lead in anything climate-related. If I’m in a group of people and I run off in one direction, I can’t claim to be leading unless the others follow. Indeed here the TBI is on the same page. They say the current strategy will bring no followers, as the example we are setting (of astronomical electricity prices) is not an aspirational one. Cheap power is a requisite of Net Zero 2050, but the Clean Power 2030 plan is creating perverse incentives. TBI helpfully list some of these, as follows:

• contracts are for volume, not value, embedding costs for decades (AR7 locking in high costs for 20 years)
• the collateral damage of grid constraints
• not placing supply near demand
• deferring system optimisation
• weakening demand for electricity due to the high price
• gas setting the electricity price (they do not mention the carbon tax).

Rapid deployment of renewables is not the same as rapid deployment of value.

As to their own idea, “Cheaper Power 2030,” it is not a retreat from climate. It is the only way that climate policy survives contact with reality. Alas, there is no way to make electricity cheaper fast (what about cancelling carbon costs?). Instead, TBI want to set the trajectory, to show that rather than drifting up, costs are going to trend down over the next few years. They want contracts for renewables that account for system costs. Unfortunately, this sceptic thinks that the renewables companies will not sign such contracts. TBI says we need to build the grid we need, not the grid that is required to integrate far-flung renewables. So much so obvious. But also obvious to me is that you cannot place vast wind farms close to demand centres. TBI want a market design that takes into account temporal factors – presumably the thing that sceptics have been calling for since forever, i.e. firm power, not “if we have it, you have to buy it whether you need it or not, and if we don’t have it, you’ll have to use the alternative system instead.”

Regarding the North Sea, the UK “cannot afford to treat domestic production as a moral signal rather than a strategic asset.” That’s something sceptics can agree with, but there are problems. First, as noted above, is that no-one will believe a U-turn, if the government makes one. The second is the flock of unibrow MPs perched on the green benches, who would vote to bring Christmas forwards to Easter, if they were turkeys. Anyway, TBI says the “climate realist” perspective is that it is better to extract our own hydrocarbons than import others. That is true, but it’s an idea that bounces off Miliband and others like a dried pea off a windscreen. This is “not about slowing the transition,” TBI insists.

The list of challenges of the future are a mixture of the realistic and the fantastic:

• firm low carbon power
• system balancing at scale
• long-duration storage
• industrial electrification
• last mile decarbonisation

Which of these are the realistic ones, I leave the reader to consider.

In the new utopia, there will be no point competing with China to build wind or solar (does this not imply that our system has uncompetitiveness built in?). Instead, we need to be innovating and building the next generation of technology (implying that wind and solar are dead ends). The current system is one of cost socialisation, when it should be technological progress. We can’t expect consumers to subsidise high cost deployments like floating offshore wind. The new utopia must come about via printed nuclear, or fusion.

TBI’s conclusion is that Clean Power 2030 is measuring the wrong thing – capacity, not affordability.

“A transition that raises electricity prices, hollows out industry and undermines competitiveness will not endure – and it will not be emulated.”

Quite a good quote to end on, but TBI lets itself down by claiming that there is no tension between climate ambition and economic strength. The UK can have both.

Conclusion

My interpretation of the latest effort is that they have noticed the problems, but they are clinging to solutions that won’t work. The undercurrent is that they cannot undermine Net Zero 2050 for fear of being dismissed out of hand.

There is a way to get to Net Zero 2050, but I don’t think most people would enjoy the journey, nor the destination.

As to the reset, yes we need it, but there is no sign of it. Nor do I expect one to happen until something falls over and breaks.

End note

The Times [23 Feb] says new data centres are asking for connections totalling 50GW. Does this imply a reset of energy strategy? They quote some guy as saying, “The choice is stark: stick to legally binding carbon budgets, unlocking even more green growth in the process, or unleash colossal data centres on UK communities and watch emissions soar.”

Sooner or later, even the Times is going to see such fantasies as no longer worthy of reporting, least of all on the front page of the paper of record.