We do think it would help if people grasped the very basics of economics before proposing economic plans. We have no problem with renewable energy - as long as it has to pass all the usual economic tests of being worth it and so on. But this strikes us as simply being wrong:
UK could unlock £70bn a year in renewable energy, report claims
Plausible for UK to become global clean energy superpower if investment is ramped up
Well, OK, so what is it they’re suggesting?
The UK could unlock £70bn every year by generating enough clean electricity to become a major exporter of energy to mainland Europe, according to a former government economist.
A new report has found that by increasing Britain’s clean electricity generation 50% above its current projections for 2050 it could become a clean energy superpower capable of exporting £17bn of green electricity to Europe a year.
The ambition to generate more green electricity than needed to meet the UK’s climate targets could also create an additional 279,000 British jobs, and support a total of 654,000 British jobs, across the UK’s clean energy industries, according to the report.
Ah, no, that’s not passing the basic economic tests, not at all.
Investment is clearly a cost. We’ve got to - at best - defer consumption in order to devote resources to building these whatever they are. That’s a cost. Jobs are a cost of doing something, so creating 279k. or 654k jobs, is a cost. We can have less NHS, or ballet, or performance poetry, food, housing and whatever because all that human labour is being devoted to renewables. Finally, exports are a cost - that’s our labour that is sent off for Johnny Foreigner to enjoy the fruits of. Sure, exporting so we can buy the fruits of J Foreign’s labour is just fine, but that’s the benefit - it’s still true that exports are the cost.
So, what this report is actually saying is that we should carry the cost of investment in order to also be able to enjoy the costs of jobs and exports. Which does seem to be missing something really rather important - what’s the benefit of this trio of costs?
The analysis by former government economist Chris Walker for the UK Business Council for Sustainable Development
Might we, ever so gently, suggest that these sums get done again? With the right plus/minus signs in front of each of the costs and each of the benefits? At which point it would be possible to actually evaluate this idea.