GREEN ECONOMICS TURNS BROWN IN UK
The United Kingdom has been the heralded as most committed country on earth to embrace green economics. P
A
|
Powered by huge government subsidies, environmental and low-carbon businesses now claim to employ over one million people and make up 8% of the UK’s GDP – from biofuels, electric cars, wind turbines and solar installations. But with the nation heading into its third recession in four years and UK losing its AAA credit rating, the British public seems ready to pull the plug on green economics and join the “Dash for Gas” to begin fracking the nation’s immense deep coal deposits. |
Following the Financial Crisis of
2008-09, the UK government committed to Keynesian deficit-spending stimulus
to “grow” the country into the world leader in green economics.
Through public spending and government direct guarantees of high returns
to private leveraged investors, total investments in UK renewable energy
projects grew from $6.9 billion in 2010 to $9.4 in 2011. More than
800 MW of wind, 300 MW of solar and 500 MW of biomass generating capacity
was funded. Phyllis Cuttino, author of the Pew Charitable Trust
Energy Report, Who’s Winning the Clean Energy Race?; stated: “In
part, investment growth in the United Kingdom can be attributed to
investors initiating new projects before policy incentives are
curtailed. To maintain growth, the UK must provide consistent,
long-term market signals that provide certainty to investors.”
Despite international media adulation for
investing public funds in the “industries of the future”, the UK fell
back into recession in 2011. Facing falling tax revenue and rising
feed-in tariff subsidies for solar panels, the government attempted to cut
subsidies to spare slashing social spending. But the UK
Supreme Court ruled cutting solar subsidies was “legally flawed”.
Despite public protests, the government’s March 2012 budget cut $14
billion in child and welfare spending.
With public scorn against the crony
capitalism of green economics mounting, Prime Minister David Cameron
hacked subsidies for future wind turbine, solar and biomass projects by
50%; causing 2012 green energy investments to fall back 11% to $8.4
billion. In September, the Prime Minister, replaced pro-renewable
energy minister Charles Hendry with John Hayes, a known opponent of wind
power.” In Mr Hayes opinion, Britain is already “peppered” with
onshore wind farms and “enough is enough.”
For two hundred years, Welsh coal
mining was the dominant energy source in the UK. But with the mines and
electric utilities nationalized after WWII, Labor government
administration resulted in skyrocketing costs and the peak chaos of 4583
mine strikes in 1979. Margret Thatcher was swept into office and
over the next 11 years uncompetitive Welsh coalfields were mostly shuttered
with a loss of more than 85,000 jobs.
The government sold off the land and
privatized the electric companies in the 1990s. Once freed of political
pressure to burn coal, the electric utilities began converting to
natural gas as a feed stock to benefit from the efficiency of gas
turbine power stations and the cheap new supplies from North Sea natural
gas discoveries.
Having decisively rejected green
economics, the UK government fully committed to the Dash for Gas
movement on December 13, 2012 by lifting its ban on hydraulic
fracturing (fracking)
for natural gas from shale deposits on its derelict coal
fields. Support for fracking now has broad political
support. Mr. Edward Davey, secretary of the UK Department of
Energy & Climate Change and a member of the left-of-center Liberal
Democrats emphasized the decision to lift the ban “is based on the
evidence. It comes after detailed study of the latest scientific
research available and advice from leading experts in the field.”
Richard Davies, Director of Durham
University’s energy institute, commented that the U.K. produces about
1.5 trillion cubic feet of gas a year and consumes roughly 3.3 trillion
cubic feet. “The geology is there but the question is: How much
can we get out?” Jon
Clark, Director of Oil and Gas Transaction Services at Ernst & Young
LLP, said “Shale gas has had a transformational supply impact in the
U.S.” He estimated if the recovery is similar to the U.S., the UK
could enjoy a 75 year supply of natural gas.
George Osborne, will deliver the 2013 UK
budget on March 20 that will slash public sector green subsidies and
embrace the private sector Dash for Gas as the path to create highly
skilled jobs, halt gas imports, increase tax revenues and benefit the
environment. The leftistUK media responded this morning
with the usual demands to
increase deficit spending, increase minimum wage, cap rents, nationalize
banks, and raise taxes on the rich. But what is conspicuously
absent is any willingness to walk the political plank to keep the green
economics from turning brown.
Present
“The American Exceptionalism Radio Talk Show”
Streaming Live Monday through Friday at 7-10 PM
Click here to listen: http://www.ustream.tv/channel/american-eceptionalism-news
No comments:
Post a Comment