<address redacted>
Dear Mr Hunt,
You will no doubt be aware of the recent report “Clean
Air, Dirty Money, Filthy Politics,” written by investigative journalist Ben
Pile for the Together organization, of which I am a member. It documents how a
large, opaque network of funding, originating from four rich billionaires, has
operated to channel resources to many organizations that are active in favour
of “net zero” and other green policies. You will also probably be aware that,
when this report was published, both the Daily Telegraph and the Daily Mail
picked up on parts of its content, and in particular the funding by billionaire
Christopher Hohn of a climate activist network called “C40 Cities” [[1]], which
is chaired by Sadiq Khan.
You may not be aware that last week, Andrea Jenkyns MP
hosted a discussion on this report in parliament: [[2]].
I am taking the liberty of copying this to her, if only to thank her for her
kind words, and to suggest some further climate related areas in which she (and
you, and other MPs) ought to find some interest.
I have heard that, following on from this occasion, a
number of MPs are being asked to sign a pledge whose wording, if I have it
right, is as follows: “The public must have transparency into funding on Net
Zero policies, and a proper cost-benefit analysis of Net Zero.” Naturally, I am
fully in agreement with this idea, and would hope that you would be, too. But
while the first part of the pledge all but goes without saying, on the second
part I am able to supply some further information which should be of interest.
Not just to yourself and Andrea Jenkyns, but to all MPs who are concerned that
their constituents ought to be treated justly, fairly and honestly, and should
receive full value for the vast sums they pay to government.
I do apologize if you find what I have written below rather
long and a bit technical. But I feel it is important to document the back-story
of this issue in as much detail as is needed to enable people to appreciate fully
what is being done to them over this.
The Green Book. As chancellor and thus its current
custodian, you will be aware of the green book [[3]], a
set of procedures meant to guide cost versus benefit analyses carried out by
the UK government. You will also be aware of its history since its inception in
2003.
The Stern Review. You will be aware that green book
procedures were already in place in 2006, when Nicholas Stern issued his Stern
Review, an (apparent) attempt to provide a cost versus benefits analysis for
policy action or inaction on reducing CO2 emissions. You may also be
aware that, as documented in Ben Pile’s report, Stern now chairs two institutes
at the London School of Economics, both active in climate policymaking, and funded
by Jeremy Grantham, another of the green alarmist billionaires identified in
the report.
The social cost of carbon. You may be aware that,
at the time, the green book procedures required cost-benefit analysis of
policies affecting CO2 emissions to use the “social cost of carbon” (SCC)
approach. In the words of the government’s historical web page on valuing CO2
emissions [[4]]: “The SCC matters because it
signals what society should, in theory, be willing to pay now to avoid the
future damage caused by incremental carbon emissions.” And in my view, this is the
right measure to use in assigning monetary value to these emissions.
Stern did, indeed, use an SCC approach in this review. But
you may not be aware that, of the three tools (integrated assessment models,
IAMs) Stern had available to him, he chose the one which gave by far the most
pessimistic estimate of the social cost of CO2 emissions. You may
also not be aware that Stern made other assumptions such as a low discount rate,
that resulted in a grossly exaggerated estimate of the cost of not taking any policy
action.
The climate change bill. The 2008 UK climate change
bill did make a token attempt at a cost-benefit analysis. The numbers were, so
I understand, based on the Stern review. But not only were these numbers
dubious for the reasons outlined above, but they had a huge range of
uncertainty too. I myself actually downloaded and read the 200 or so pages of
supporting data and calculations. If I recall right, there was a factor of 7
uncertainty in the costs, and a factor of 12 uncertainty in the “benefits,” of
taking action to reduce CO2 emissions in order to mitigate some
putative climate change.
On 14th July 2008, I wrote a 9-page letter to
you, Mr Hunt, as my MP, giving you a synopsis of the facts on the matter, and
inviting you to inform yourself fully; and then, when you understood the facts,
to vote against the bill. Yet you failed even to acknowledge my letter, let
alone to respond to it! And, you, along with 400+ other MPs, voted for the
bill.
The shadow price of carbon. Between 2007 and 2009,
steps were taken to move away from the social cost approach. I will quote again
from the valuations page I referenced above. “Carbon valuation for policy
appraisal no longer uses the social cost of carbon.” And: “In December 2007,
the approach to carbon valuation adopted the use of the shadow price of carbon
(SPC) as the basis for incorporating carbon emissions in cost-benefit analysis
and impact assessments. However, it takes more account of uncertainty, and is based
on a stabilisation trajectory.”
This page [[5]]
links to the documentation on the change to using the shadow price of carbon.
It also links to reviews on that change by a number of economists. Some of
these are dated 2007, but others are dated 2009, indicating that they refer to a
further change in that year.
Paul Ekins’ 2007 review [[6]]
said: “The issue is how to arrive at such a price in a way that is both
defensible and supports the Government’s climate change policy.” Ekins goes on
to outline a plan “to seek to estimate the MAC [marginal abasement costs]
required to reduce carbon emissions to achieve the desired UK contribution to a
global goal of stabilising carbon concentrations in the atmosphere at a level
thought to avoid unacceptably dangerous climate change.” So, the climate change
policy required a pricing mechanism that wasn’t defensible? That’s a bit of a
revelation. As is the admission that some “global goal” was seen as more
important than the interests of the people of the supposedly democratic UK.
The 2009 review by Paul Watkiss [[7]]
says: “We now have defined policy targets for the short- and long-term, which
were not set on the basis of the social cost of carbon (SCC), and thus there is
a high risk of under- or over-delivery of these targets if Government continues
to use a SCC value.” I read this as an admission that policy targets had been
set without considering cost-effectiveness from the point of view of the people
who would pay the costs. And here we are, 14 years later, and we still
don’t have a proper cost-benefit analysis on “net zero.”
As an aside, Paul Watkiss had been the chair of the group
that in 2003 produced a feasibility study for what in 2008 became the original London
Low Emissions Zone (LEZ).
Today, there seems to be no longer a link from [[4]] to the detail on the 2009 change. However,
the original page is still available, here: [[8]].
The punch-line is as follows: “The old approach based on estimates of the
social cost of carbon should be replaced with a target-consistent approach,
based on estimates of the abatement costs that will need to be incurred to meet
specific emissions reduction targets. The change will have the effect of
helping to ensure that the policies the government develops are consistent with
the emissions reductions targets that the UK has adopted through carbon
budgets, and also at an EU and UN level.”
If I read that right, it means that the UK government had
abandoned any attempt or pretence at trying to work out how big the CO2
problem really was. Cynically paraphrased, their argument seems to have been:
“We know we can’t do a credible cost-benefit analysis that justifies any
political action on this. But we’re already committed to political action. So,
we’ll make up numbers to match the commitments, and hope that no-one notices.”
On that page, there is also a link to a review by Paul
Johnson [[9]].
The following comment is most revealing: “The problem is, of course, that the
natural response of the economist to some of the arguments put forward here –
that the SCC may be inconsistent with targets and international agreements – is
that this just reveals the incoherence of the targets and agreements. I am not
in that camp, but the paper needs more explicitly to rebut that view.” And, a
little further down: “given a target, the consistent approach is to value
carbon in such a way as to ensure we hit the target.” Again, policy cart before
cost-benefit horse, no?
The 2019 CCC report and “cost-benefit analysis.” On to
the run-up to the Commons declaring a “climate emergency” on 1st
May, 2019, without even taking a vote. For this occasion, the CCC (Climate
Change Committee) had produced a report “Net Zero: The UK’s contribution to
stopping global warming” [[10]].
All I could glean from this report is that they reckoned the cost of “net zero”
measures might be 1-2% of UK GDP in 2050. But as we know, government
projects always cost more and take longer.
More interesting than what the report says, are the mugshots
and bios of eight CCC members at the beginning. One of the eight is an
economist called Paul Johnson.
Somebody high up must have decided that going ahead with
“net zero,” without having published any proper cost-benefit analysis at all,
was going to be a little risky. So, this report was produced: [[11]].
It purported to be a cost-benefit analysis for “net zero” CO2
emission policies. You can note that the chairman of the group that produced
this report, Paul Ekins, was the same economist who drove the 2009 decision to
move away from the use of the social cost of carbon. You can see in action the
MAC approach which replaced it, and you can marvel at how obscure and
counter-intuitive it seems. You can also marvel at the lack of monetary numbers
in the report for the estimated costs of a given level of “climate change!”
Shadow price versus social cost. In a 2022 report
by economics consultancy Cebr for Fair Fuel UK, accessible via [[12]],
it was revealed that the number the UK government used to calculate the
benefits of reducing CO2 emissions by a tonne (£255.40) – based on
the shadow price of carbon – was more than five times the sterling equivalent
of the US government’s published value of the “social cost of carbon” per tonne
(£48.54). The replacement of social cost by shadow price made a very big
difference to any costs or benefits calculated using it!
Costs and feasibility of net zero. All this does
not take into account the steeply rising costs of the “renewable” energy, which
net zero policies mandate. We have been repeatedly told by the media that
renewable energy is cheap. But that has never been completely true, and is
becoming less so by the day. Offshore wind “maximum strike” prices have recently
gone up by 66%: [[13]].
The corresponding prices for tidal, geothermal and solar power have also gone
up significantly. It is hard to imagine that these rises will not be passed on,
and sooner rather than later, to hard-hit consumers.
And that doesn’t take into account the huge re-configurations
of the electricity grid, that will be needed to support these new renewables.
Nor does it cover the need to provide conventional back-up energy, for the
times when the wind doesn’t blow, or the sun doesn’t shine; or both, as in a
cold, windless anticyclone in February. Nor does it cover such aspects as global
supply problems, for example of lithium for EV batteries; of likely non-delivery
of technologies required for net zero, such as cost-effective hydrogen
production; or of the level of safety of these new technologies, relative to conventional
ones.
It looks very much to me as if “net zero” and related
projects have not been properly planned, or their consequences thought through.
I sense rising now a tide of very real concern, over the question: Can “net zero”
actually be achieved, in any timescale? And that is on top of the
question: Even if it was feasible, would it be worth doing? (My answer to that
is a strong No.)
Green Book update of 2020. In 2020, there was an
update to the Green Book, described here: [[14]].
It says at the outset: “As ultimate decision makers, ministers are not bound by
recommendations arising from green book appraisals.” That seems rather concerning to me. Why bother to do them, then?
Of its history, it says: “In March 2020, the Government
announced a review of the approach, to improve how the Green Book supports
strategic priorities such as its ‘levelling up’ agenda and the transition to
net zero greenhouse gas emissions.” Later, it says: “The 2020 review of the
Green Book concluded that it failed to support the Government’s objectives in
areas such as ‘levelling up’ the regions and reaching net zero. The review said
this was because the process relied too heavily on cost-benefit analysis, also
known as the benefit-cost ratio (BCR).” And there was “insufficient weight
given to whether the proposed project addressed strategic policy priorities.”
Further, under the new Green Book, “a project with a low BCR could go ahead if
it were the best option to achieve a particular objective.”
This seems to imply that policies that politicians deem to
be “strategic,” including “net zero,” are to be exempt from cost-benefit
analysis! No matter how damaging those policies will be to the people the
government is supposed to be serving. Let that sink in.
And the timing of this update was very, very interesting.
In mid-February 2020, chancellor Sajid Javid resigned, refusing to bow to
pressure from prime minister Boris Johnson to change his advisors. Rishi Sunak
– now prime minister! – took over as chancellor. It is probably no coincidence
that the review of the Green Book began in March.
“Clean Air, Dirty Money, Filthy Politics.” To
justify the main conclusions of his report, Ben Pile cites the following. Large
grants from the Bill and Melinda Gates Foundation to, among others, the United
Nations’ World Health Organization (WHO), Imperial College London, at the
centre of controversy over both COVID and ULEZ, and the BBC and other media
that take the climate activist side. Funding of climate change campaigns by
billionaires Michael Bloomberg and Christopher Hohn. Involvement of C40 Cities and
UK 100 [[15]],
“a network of local leaders who have pledged to lead a rapid transition to Net
Zero with Clean Air in their communities ahead of the government’s legal
target,” in both net zero and air quality campaigns. And funding of UK
university departments active in the climate change and air pollution arenas,
not only by the Gates foundation, but also by Jeremy Grantham.
I can thoroughly recommend a read of this most eye-opening
report. But for those without sufficient time to fully digest the original, I
have made my own summary, here: [[16]].
The Conservative Environment Network. One series of
most interesting grants from Christopher Hohn, via the “Clean Air Fund,” which
have totalled $160k over three years, is to the Conservative Environment
Network (CEN). This organization includes many MPs [[17]]:
indeed, half or perhaps even more of current Tory MPs, including yourself, Mr
Hunt. Other names on the list include:
·
George Eustice, a former secretary of state for
the environment.
·
George Freeman, current under-secretary of state
for science, research and innovation. And custodian of the “Strategic
Priorities Fund,” which funds the government’s “Strategic Priorities Fund Clean
Air Programme.”
·
Chris Grayling, a former secretary of state for transport.
·
Matt Hancock.
·
Mark Harper, current minister of state for transport.
Who claimed that he “did not have the power” to stop the recent ULEZ expansion.
·
Robert Jenrick, who was involved in Michael
Gove’s meeting with Extinction Rebellion in April 2019.
·
Kwasi Kwarteng, former chancellor.
·
Alok Sharma, chair of the CoP26 meeting in
Glasgow, and keeper of two diesel SUVs at the time.
It is hard to avoid the thought that some of these at
least may have been influenced, in ways not in the best interests of those they
are supposed to serve, by activist ideas such as Hohn’s.
The case against a climate crisis. For Andrea Jenkyns’
benefit, I would like to close by giving a link to the following article, which
I wrote earlier in the year, and which was re-published at wattsupwiththat.com,
“the world’s most viewed site on global warming and climate change.” It is
here: [[18]].
(Mr Hunt, I sent you this article back in April.) I will quote from my
conclusions: “Whatever alarmists may say, I for one don’t see any evidence for
a ‘climate crisis.’ Still less is there any hard evidence that emissions of CO2
from human civilization are causing any climate problems at all. Nor is it at
all certain that any amount of reduction in CO2 emissions would
achieve any improvement in the climate.”
In a nutshell, when you disregard the hype and look only
at hard evidence, and when you require a high standard of proof – as you would,
for example, if on the jury at a criminal trial – then there is no case for any
action at all to limit CO2 emissions, or to implement any of the
other associated policies.
To conclude. I hope that what I have had to say on
this occasion may have given you some pause, and may set you thinking about the
conduct, over these matters, of the UK government towards the people it is
supposed to serve. I do not think that the sorry tale I have related – with its
supporting links, many of which come from the government’s own web pages – gives
any reason to be complacent about the situation. You will no doubt be aware
that many people, even very many people, have become extremely unhappy about
the way that, in many policy areas, all the main political parties have essentially the same policies, all of
which are harmful to the people. That is not a situation that can long be
tenable in a democracy. Something has got to slip.
If the case for “net zero” policies is fatally flawed, as
I and many other “ordinary” people strongly believe it is, then government
should be taking extremely prompt action to reverse these policies. For a large
group of MPs to pledge to get a proper, objective, unbiased cost-benefit
analysis done and published before any further policy action is taken on any of
these fronts, would be an encouraging start. If this does not happen, that would
increasingly call into question whether today’s politicians have any interest
in democracy, or in the people they are supposed to serve.
Yours sincerely,
Neil Lock
[[1]] https://www.c40.org/
[[3]] https://www.gov.uk/government/publications/the-green-book-appraisal-and-evaluation-in-central-governent/the-green-book-2020
[[5]] https://www.gov.uk/government/publications/shadow-price-of-carbon-economic-appraisal-in-the-uk
[[6]] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/243828/paul-ekins.pdf
[[7]] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/243823/1_20090714193626_e____pwatkiss__1_.pdf
[[8]] https://www.gov.uk/government/publications/carbon-valuation-in-uk-policy-appraisal-a-revised-approach
[[9]] https://assets.publishing.service.gov.uk/media/5a7c19e640f0b645ba3c6b31/1_20090714193549_e____pauljohnson.pdf
[[10]] https://www.theccc.org.uk/wp-content/uploads/2019/05/Net-Zero-The-UKs-contribution-to-stopping-global-warming.pdf
[[11]] https://www.theccc.org.uk/wp-content/uploads/2019/05/Advisory-Group-on-Costs-and-Benefits-of-Net-Zero.pdf
[[13]] https://www.gov.uk/government/news/boost-for-offshore-wind-as-government-raises-maximum-prices-in-renewable-energy-auction
[[15]] https://www.uk100.org/
[[18]] https://wattsupwiththat.com/2023/03/15/climate-crisis-what-climate-crisis-part-one-the-evidence/
