Thursday 19 September 2024

The complex economics & trade-offs of 'net zero'

At the polar-opposite ends of the 'net zero' policy debate are two fatuous positions we may caricature thus:

A.  renewable energy is so cheap and creates so many excellent new jobs, the whole thing will easily pay for itself in economic terms alone (never mind "saving the planet"): it's just a matter of some easily-afforded up-front investment and a bit of planning;

Z.  the very attempt to bring about a 'net zero' economy will destroy the entire existing economy.

Along the spectrum between these two extremes are so many subtle trade-offs that have presumably been resolved to their own satisfaction [1] by those who've made their way to one of the extremes.   Except, we don't see their working displayed very often.

Here are a few:

  • Renewables are in fact more expensive than the energy mix they are designed to replace.  True: but we often decide to pay more for a cleaner outcome (cf the Clean Air Act, the water industry, etc etc).
  • The roll-out of what we might call a 'net-zero-intended' programme would create a lot of new jobs.  True: but the industries that will be made obsolete along the way will collapse (often "by mistake"[2]) before any kind of equilibrium, let alone positive balance is established.
  • There are virtually no short term benefits of most[3] individual 'net-zero-intended' projects upon completion: and even the supposed long-term benefits are questionable.  True, but in certain circumstances the Keynsian insight about digging holes has a lot of force.
  • Nuclear energy ticks a lot of 'net zero' boxes.  True, but nobody has truly resolved the short-term / long-term calculus on nukes.
  • Something approximating 'net zero', as currently envisaged, would make us less energy-dependent on imports in the long term.  True, but in detail this is an exceptionally complex issue both to characterise fully, and still more to 'optimise'.

And so on.  

All this deserves better policy-making than we get.  And more transparent, too.  I am heartily sick of being lied to - by both 'sides'.

ND

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[1] Obviously that credits them with at least rudimentary intellectual processes that in practice may not have troubled them too much.

[2]  Watch, for example, the UK oil & gas industry, as illustrated here (always assuming the collapse of the mining sector isn't enough evidence already).  The Unions know this, of course.

[3] Most, but definitely not all.


15 comments:

Matt said...

Nuclear waste dangers are over exaggerated in the same way as global warming, by the same bad actors, and for the same reasons. The outcome is not to improve things in any way (financially or environmentally) but to impose a dictatorial oppressive communism on us.

Wildgoose said...

So-called "dangerous" nuclear waste can also be used as a neutron source for Thorium molten-salt reactors, putting it directly to use and "consuming" much of it in the process.

The "Net Zero" madness is definitely extreme. For example, we need coal to make fresh steel. (Electric Arc furnaces use scrap steel, and we don't have enough of that for our needs). So, we need the new coal mine at Whitehaven.

The Extremists in charge won't allow a coal mine in an area of high unemployment to preserve steel jobs in other areas of high unemployment.

Their extreme beliefs are no different, in essence, to any other extremists such as the Taliban.

Clive said...

Agree with the post. For me, energy, especially electricity is not a market where anyone can say “oh, this is it, this is the answer, this is how it works”. If they do, they’re scamming you. It has always been this way. Is rural electrification a justified social good or an unnecessary subsidising of sub-scale consumers? Will Sizewell C ever make a “profit”? How are generators to satisfy the last kWh on the grid — price it off the network or build new capacity? And so on.

There are no “right” answers to any of this. Just difference political and market-mechanism nudges.

patently said...

Ben Goldacre offered "I think you'll find it's considerably more complex than that" as a universal answer to most public debates. He has a point...

dearieme said...

Damned if I see what's fatuous about option Z, apart from a bit of vagueness. I suppose I could complain that it doesn't go far enough; it doesn't say that the attempt to get to net zero is madness anyway since there is no evidence that recent enmildening is caused by human emissions of CO2.

Remember what the early Global Warmists said (before their field became a hotbed of lying crooks): the warming they predicted would be concentrated overwhelmingly at high latitudes, in winter, at night. The logical response is "Oh goody, longer growing seasons".

Anonymous said...

You got the "polar-opposite ends of the 'net zero' policy debate" quite wrong. They are
1. Global warming is occurring and it definitely is as a result of human action and it is a serious danger with minor benefits.
2. Global warming may be occurring and it may be as a result of human action but it is a huge net benefit with minor dangers.

I favor approach #2. I am in Calgary Canada and we expect -1C tonight this 21st day of September. I'm freezing my arse off and all I want to do is hit alarmists with a clue-bat.

We are currently at the lowest surface Earth temperature in 485 million years. https://x.com/zerohedge/status/1837129533947867555

Nick Drew said...

Anon, I was talking about the policy debate: you're referring to the scientific debate

Policy has long since been based on #1. That battle was lost well over a decade ago. Since when did science take precedence over policy?

Elby the Beserk said...

And very low CO2 levels historically.

Elby the Beserk said...

Climate crisis?

https://x.com/zerohedge/status/1837129533947867555/photo/1

Elby the Beserk said...

Source fyi https://www.zerohedge.com/weather/msm-journos-inadvertently-reveal-shocking-truth-about-global-warming

ps. don't shoot the messenger, it's boring and dumb...

estwdjhn said...

I think the trouble with Nuclear is that low risks of very bad outcomes are particularly hard to quantity. I'm particularly uncomfortable with the SMR concept for this reason - lots of small units statistically present a greater risk of a mishap than a few big ones, and it doesn't matter what size the unit is if you manage to release a plume of radioactive material - you'll still make a big chunk of the country uninhabitable for 50 years.

dearieme said...

"Since when did science take precedence over policy?"

When the chickens come home to roost. The Second Law of Thermodynamics always wins.

Anonymous said...

"you'll still make a big chunk of the country uninhabitable for 50 years"

Whereas playing "how far can we push this?" with Russia is actually safer! Because if they win in Ukraine then Putin's Cossack Hordes will be across the Danube before you can say "how many stotinkis to the lev?".

Nick Drew said...

dearieme - yup, we agree on that one. You can suspend the law of gravity itself - for just as long as the money keeps flowing: and then ...

patently said...

ND, dearieme - We do know that, Feynman reminded us in the context of the Shuttle report that "reality must take precedence over public relations, for nature cannot be fooled". We just choose to forget it from time to time.

(https://www.nasa.gov/history/rogersrep/v2appf.htm)