Green Cronies: The £60 Billion Government And Big Business Front-Group

  • Date: 22/01/13
  • Ben Pile, Climate Resistance

A full 36 of the 100 organisations behind the Energy Bill Revolution campaign are in fact  companies, with a direct interest in the government diverting £60 billion towards energy efficiency measures. What company wouldn’t get behind a campaign that would unlock such a vast sum of cash? And we’re not talking small money here — we’re talkign about £6,666 for each of those 9 million households.

Typically, cold weather such as the UK is experiencing — an inch or so of snow that brings the country to a grinding halt — is used as the background to stories which challenge climate change orthodoxy. The tale needs barely any retelling: the milder winters and warmer summers we were promised simply haven’t materialised. As incautious as such arguments (like Boris Jonson’s) are, they are nothing compared to the absurdities of the argument they are countering. It was the extravagation in the first place which gives the ground to people who then ask, ‘where is this climate change, then?’ After all, the weather seems much as it was decades ago.

But today, it wasn’t as much the ‘deniers’ taking advantage of the cold weather, as the ‘Energy Bill Revolution‘ campaign. They got themselves an article on the front page of the Times, in the Daily Mail, and on Sky News. According to The Times,

More than 100 energy companies, charities and businesses have joined forces to warn David Cameron that Britain is heading for a fuel poverty crisis owing to a failure of government policy.

The group of 100 companies’ demands are simple enough:

An unprecedented alliance, including Npower, the Co-operative, Age UK and Barnardo’s, urges Mr Cameron to use money raised from the “carbon tax” to be levied from April to tackle the “national disgrace” of cold homes. A programme to fit houses with proper insulation would, they say, protect the vulnerable, help the environment and boost the economy.

But this is opportunism. The research in question was produced back in November. As this blog reported back then, the plan is to spend the £60 billion revenue from carbon taxes over the next 15 years on fitting the poorest 9 million homes in the UK with ‘energy efficiency’ measures.

But £60 billion is a lot of money. And I didn’t think that such a vast sum of money was worth it. Indeed, it would be enough money to buy 16GW of nuclear power plant. This would make it possible to reduce bills for all domestic energy consumers, and/or, if it was necessary or desirable, subsidise energy bills for the poor:

So how will this benefit people living in fuel poverty? Well, the ongoing plant costs under my scheme cost £1,099,180,017 — roughly a £ billion per year for the entire domestic sector. Between 25 million homes, that is about £43 per home per year, not including the cost of develiery. We’ve met the upfront capital cost of £55 billion through carbon taxes over 13 years. Now we can sit back and enjoy the cheap energy. According to OFGEM, 54% of a £470 electricity bill is ‘wholesale cost’. So that’s £253. And since we’re no longer producing any nasty CO2, we can remove the £47 charge for ‘environmental costs’ the government add to bills. The average bill now looks like this: £43 wholesale electricity cost, £84.6 for distribution, £23.5 transmission charges, £9.2 VAT, and £32.9 ‘other costs’, coming to a total of £193.2 per year. We’ve reduced the average electricity bill by £276.8 for everyone, not just the fuel poor. That’s taken many people out of fuel poverty — especially if they use electricity rather than gas to heat their homes. But if we’re still feeling generous, perhaps we could give some extra relief to the remaining fuel poor.

The problem is one created by making ‘efficiency’ an end of energy policy — a good, in and of itself. But efficiency is not necessarily a virtue. It might be (indeed, it clearly is) the case that energy inefficient homes could be better cared for by reducing the cost of energy, than by plugging up the gaps. If it costs 10 times as much to fill the gaps than it does to double the amount of energy used to heat the home, then clearly the greater virtue is in lowering the cost of energy.

But that’s not how the Energy Bill Revolution see it. Their call today is intended to put pressure on the government to use the Carbon Tax on their preferred measures, no matter what a cost-benefit calculation shows. So, then, it is not a surprise to see that the Energy Bill Revolution campaign counts a number of organisations and companies with an interest in energy efficiency. They include:

Anglian Home Improvements
Association for the Conservation of Energy
Carrillion PLC
Climate Bonds Initiative
Decarbonize consultants
Good Energy
HIS Energy group
Home Heating Solutions Ltd.
Kingfisher PLC
Kingspan PLC
Knauf Insulation
The Mark Group
The Mears Group
The Mineral Wool Manufacturers Association
Nationwide Energy Services
National Insulation Association
N Power
Parity Projects
Passive Systems
Places for People
Red Roof Energy
SSE Energy
SIG Energy Management
STO ltd.
Willmott Dixon Group
WSP Group

So a full 36 of the 100 organisations behind the campaign are in fact companies, with a direct interest in the government diverting £60 billion towards energy efficiency measures. What company wouldn’t get behind a campaign that would unlock such a vast sum of cash?

Then there are the NGOs. I won’t list the usual suspects — the Greenpeaces and FoEs. What is surprising is the number of organisations who claim to be protecting the interests of the elderly, the young, the homeless and the poor. The category of ‘fuel poverty’ that will include 9 million households in just a year’s time would be reduced substantially, were energy bills more affordable. But rather than campaigning for ways to make energy cheaper, leaving more money in the pockets of those people, these organisations have put their names to a campaign that will put money in the bank accounts of energy, construction materials and services companies. And we’re not talking small money here — we’re talkign about £6,666 for each of those 9 million households. In 2004, there were only 1.2 million households in ‘fuel poverty’. Sharing £60 billion between them would amount to £50,000 each — not inconceivably the value of an entire house, never mind a refitting of an old house. Why weren’t these organisations calling for that, in 2004? Why is it only energy that warrants the attention of this coalitions of companies and NGOs? Why not food poverty, clothing poverty, if there’s a category called ‘fuel poverty’? And if 9 million people really are living in inadequate accommodation, why campaign only on the basis of their homes ‘energy efficiency’ ratings? And why now?

Well, the Energy Bill Revolution website informs that

The Energy Bill Revolution is an alliance campaign coordinated by Transform UK, a programme of the sustainable development organisation E3G. Transform UK works to build alliances to accelerate investment into the low carbon economy in the most socially just way.

Transform UK, turns out to be ‘The alliance that campaigns to accelerate investment into the low carbon economy.’ It’s about page explains further:

Transform UK was set up in January 2009 to identify and deliver transformational solutions for accelerating investment into the low carbon economy to help build climate, energy and economic security.

A steering group was set up which included a broad range of stakeholders representing civil society, unions, academics, think tanks, business and finance.

In February 2009, in a collaboration between three members of the steering group, E3G, Climate Change Capital and Friends of the Earth, the first paper proposing the establishment of a UK Green Investment Bank was written and promoted. Subsequent analysis was undertaken by other key stakeholders including the Aldersgate Group, Green Alliance, Policy Exchange and the Institute of Civil Engineers.

This inspirational idea to set up a dedicated institution to leverage billions of private capital into the low carbon economy was agreed as the first campaign priority of the Transform UK alliance.

Transform UK operates as the national hub for the Green Investment Bank campaign and helped to get cross party political support for it in the lead up to the 2010 General Election. The Government subsequently confirmed in its coalition agreement that it would set up the Green Investment Bank.

The Transform UK alliance is committed to supporting the development of the Green Investment Bank, Green Bonds and other solutions for accelerating investment into the low carbon economy.

So Energy Bill Revolution is a project of Transform UK, which is itself a project of E3G, Climate Change Capital (bankers), and Friends of the Earth. The financiers clearly have something to gain, as do Friends of the Earth, who, as the public record shows, are the beneficiaries of many millions of EU and UK public money.

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