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Dr Muriel Newman

The Path to Energy Rationing

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The 2009 International Climate Change Conference, hosted by the Chicago-based free market think tank the Heartland Institute, was held in New York last week. It drew together over 700 attendees including world-leading climate scientists, legislators, researchers, policy-makers, and media representatives in order to share new research and fresh insights into the climate change controversy.[1]

What emerged is a very clear appreciation that the debate over man-made global warming has moved on from being about the climate and science, to being about political power and control. At stake is whether individuals will have the freedom to improve their living standards through access to unlimited affordable energy, or whether access to affordable energy will be restricted by the decree of the United Nations and the environmental forces that drive it.

Energy has long been the engine of mankind’s progress. From a world of manual labour, progressive nations have embraced energy-intensive technologies to build the sophisticated living standards enjoyed today. In more and more countries, citizens now take for granted access to fresh water and sanitation, light and warmth, computers and cars, and a plethora of labour-saving devices that previous generations could not have even dreamt of.

But all of this is under threat from the global warming environmental movement, which is driven by the radical ideology that the planet needs to be saved from humans. While the former Labour Government certainly embraced this dangerous ideology, unfortunately for New Zealand, there are strong indications that the new National Government is toying with the idea of buying into it as well through the imposition of an energy tax in the form of an Emissions Trading Scheme (ETS).

There is no sound scientific reason to introduce an energy tax into New Zealand. Taxes are only implemented for the purpose of raising money for the government by making the taxed item – in this case energy – more expensive. And if energy becomes too expensive, not only will it dangerously lower living standards, but it will put the country on the path to energy rationing. In other words, the introduction of an ETS, would seriously contravene National’s 2008 election campaign promise of lower taxes and higher living standards.

While New Zealand’s isolation from the rest of the world is often regarded as an advantage, it can be a real drawback when it shields us from matters that should be of wide public interest. With an ETS on National’s agenda, one issue that we should be closely monitoring is the impact of the European Union’s (EU) Emissions Trading Scheme on member countries. To put it bluntly, with the carbon prices having collapsed not once but twice, an ever-growing bureaucracy, rising energy costs, massive job losses and no appreciable reduction in carbon emissions, the EU’s scheme has been an unmitigated disaster.

Roger Helmer, a UK Conservative Party Member of the European Parliament, explained to the conference that the costs of the European Union’s ETS “are estimated at around €73 billion across the EU, and £9 billion in the UK. It is estimated that this will add around US$300 to the average household electricity bill, and will drive an extra million people in the UK into fuel poverty (where fuel costs exceed 10% of disposable income). The programme will result in unintended consequences and perverse incentives. It will introduce gross distortions into the energy market.”[2]

He explained that if it wasn’t for taxpayer subsidies, nobody in the world would be building windfarms, and he concluded his presentation with words of warning for New Zealand and all of the other countries that are unlucky enough to have governments that are planning to introduce emissions trading schemes (sometimes called Cap’n’Trade schemes): “I’ve seen the future of Cap’n’Trade, and believe me, it doesn’t work.”

In his presentation to the conference, Dr Gabriel Calzada, President of the Spanish think tank the Juan de Mariana Institute and associated professor in economics at the King Juan Carlos University, asked whether the EU’s/Kyoto’s emissions trading scheme had lived up to the promise that it would reduce warming and carbon dioxide in a cost effective manner, while creating jobs. His categorical answer was NO![3]

He presented evidence that total EU emissions had not decreased since the Kyoto Protocol was signed, but had increased at double the rate of the United States with emissions in Spain increasing by a massive 52 percent! On top of that, the cost to the Spanish business sector, which the government promised would not exceed €85 million annually, has risen to more than €3 billion with some companies being forced to close down production because of a lack of access to greenhouse gas allocations, while other companies were relocating overseas because of the ETS burden and related blackouts as well as high electricity costs, not to mention a Kyoto rationing scheme that was placing Spanish industries “in a very grave situation”.

On top of that, Spain, eager to comply with EU renewable energy targets, introduced subsidies of 90 percent over market prices for windpower and 575 percent over market prices for solar power. The predictable result is a massive waiting list of Spaniards wanting to get into the renewable energy business! With some 50,000 green jobs created as a result of over €28 billion in subsidies, each green job has cost a massive €500,000! Further, new research (to be released later this month) will show that for every green job that has been created through subsidies, more than 2 jobs have been destroyed in the real economy.

To date, the only European Union leader prepared to take a principled stand on the global warming controversy has been the President of the Czech Republic, Vaclav Klaus. President Klaus reported to the conference that in his country, a new public opinion poll shows that only 11 per cent of people believe that man has a significant influence in warming the climate. With a President who has been very outspoken about how global warming alarmism is essentially an attack on freedom and living standards, it is little wonder that his public are extremely skeptical of global warming propaganda.

In his keynote address to the conference, No Progress in the Climate Change Debate – which is this week’s NZCPR Guest Commentary – President Klaus, who is also the current President of the European Union, explained how the United Nations IPCC is a massive bureaucracy that is generously funded by those green businesses that have a great deal to gain from maintaining high levels of public fear over global warming alarmism. He also expressed his disappointment that no other leader was prepared to stand up against the propaganda:

“A few weeks ago, at the World Economic Forum in Davos, I spent three hours at a closed session of about sixty people – heads of states and governments with several IPCC officials and ‘experts’ like Al Gore, Tony Blair and Kofi Annan. The session was chaired by the Danish Prime Minister because its main topic was how to prepare the new Kyoto, the December 2009 UN-Copenhagen summit.

“It was a discouraging experience. You looked around in vain to find at least one person who would share your views. There was no one. All the participants of the meeting took man-made global warming for granted, were convinced of its dangerous consequences and more or less competed in one special discipline – whether to suggest a 20, 30, 50 or 80% CO2 emissions cut as an agreed-upon, world-wide project. It was difficult to say anything meaningful and constructive. Among other things I tried to turn their attention to was the argument that they made such radical proposals even though their own countries had not fulfilled even the relatively modest Kyoto Protocol obligations. There was no reaction to that. After the session, one friendly looking president of a relatively large non-European country told me that he had never heard anything like my views, but was interested and wanted to hear more. I gave him my book Blue Planet in Green Shackles.”

The former Chief of Staff to President George Bush (Snr), Hon John H Sununu, focused his presentation on the politics of global warming. He explained, “the alarmists have learned well from the past. They saw what motivates policy makers is not necessarily just hard science, but a well orchestrated symphony of effort. Their approach is calculated and deliberate. Remember the quote from one of the most outspoken alarmists, We offer up scary scenarios, make simplified dramatic statements, and make little mention of the doubts we have.” [4]

Dr Sununu suggested that if we are to avert a policy disaster, “We need to recognize that for at least most of the next decade the real battle will be to win over public opinion and influence the policy makers”.

All around the world public opinion on the importance of climate change is falling. The onset of the global economic crisis has taken the steam out of the issue reducing its importance in the eyes of the public. Not only that, but there is also evidence from the environmental movement that once people have seen the ‘other side’ of the climate change argument twice – that it is nature, not man, that influences the climate – then they begin to question whether the planet’s chief nutrient, carbon dioxide, could possibly be a dangerous gas.

But in spite of these changes, bureaucrats and politicians committed to pushing through climate change legislation will not be easily sidelined. Nor will the vested interest groups that have grown strong over recent years. That’s why your effort to help sway public opinion is needed now – while this issue is still being considered by a Select Committee.

Armed with the knowledge that people begin to question global warming propaganda if they have been exposed to alternative views twice, why not send this newsletter on to everyone on your mailing list? Or print it and pass it on to people who you know would be concerned about higher energy prices.

Why not make your opinion count by writing a letter to the editor of your local newspaper or calling talkback radio? And most importantly, why not visit the Parliament page of the NZCPR website (click here) for the email addresses of MPs and share your views with them directly?

I will leave the final comments to Dr Benny Peiser of John Moores University in the UK, who is an international expert on climate change policy. He explained that with climate policy now undermining “the very fabric of the EU” and with Kyoto undermining “the EU’s international competitiveness”, “there is now a developing consensus within EU governments that its unilateral guiding principle has to be abandoned”.

Dr Peiser is predicting that the cost of Europe’s energy policy is giving rise to a political backlash in many European countries and that, “Above all, Europe’s politicians have recognized that climate taxes have turned to political liabilities that may undermine economic stability and their chances of re-election”.

Any politician wanting to introduce an ETS into New Zealand would do well to reflect on that reality.

1. Heartland Institute Climate Change Conference Proceedings 
2.Roger Helmer, The Emissions Trading Scheme 
3.Dr Gabriel Calzada,  Spain’s New Economy: Boom and Bust of the Spanish Renewable Miracle 
4.Hon John H. Sununu, The Politics of Global Warming