The perils of cheap energy

If what scientists tell us about the dangers to the planet's climate is really true - and the government's white paper on energy, issued last Monday, opens with some thoroughly alarming charts and statements, including the possibility that the Gulf Stream could soon be switched off - it demands a response of near-wartime proportions. If millions of people are about to drown or be fried to death as a result of excessive energy use, you would expect official wardens to be patrolling the streets at night, demanding that we put out the lights, rather as air-raid wardens enforced the blackout in the 1940s. The threat of climate change, however, has come at the wrong moment in history, with all forms of state bossiness and command-and-control discredited, individual freedoms to consume at minimum cost beyond challenge, and market solutions paramount. Thus, whatever sense of urgency is created by the white paper's introduction is dissipated a few pages further on, when it states that "we do not believe that the government is equipped to decide the composition of the fuel mix" and that "we prefer to create a market framework". The paper is explicit that from ministers who normally set targets as others set their watches, there will be no targets on this subject.

This is not to deny that the white paper, putting the environment for the first time at the centre of energy policy, is admirable in its way, particularly when Britain, for the first time since the industrial revolution, faces the loss of self-sufficiency in energy supplies. It could very easily have been a document concerned largely with the security and affordability of energy supplies. It is to the credit of the minister responsible, Patricia Hewitt at the Department of Trade and Industry, that it is not. But most people do not follow energy policy closely; the white paper only made page 14 of the Daily Mail. What the public knows is that domestic electricity prices are, in real terms, 26 per cent lower than in 1990 and gas prices 20 per cent lower; that gas-guzzling people carriers are the height of fashion; that a few lorry drivers can easily frighten ministers out of higher petrol prices; that public transport is in precipitous decline; and that (whatever US and British leaders tell us) we seem about to go to war to secure oil supplies. Only the Mayor of London, Ken Livingstone, seems at all serious about restricting car use - and his example shows what politicians, if they are bold enough, can do.

Being green is vaguely smart, in the way that being vegetarian is; but profligacy in energy use does not yet attract the social odium that, say, wearing animal fur does. An excessive concern with energy-saving is still regarded as slightly eccentric, and largely associated with beards, sandals and old folk who are always talking about the war. Just as UK governments pursue cheap food policies, and then seem surprised that so many people become obese, so they pursue cheap energy policies, and then express horror at extravagant use of fuel. It is hardly surprising that Britain's energy consumption, in proportion to GDP, is higher than in most European countries, including France, Germany and Italy. We have created a dynamic market in selling energy (one-third of the population have switched suppliers since liberalisation), where competition can be on little other than price. Doorbells are not rung by local council officials pressing grants for home insulation, but by rival suppliers, pressing promises of cheaper energy if you switch from one to another. True, suppliers have agreed energy-saving targets with the government, and therefore increasingly offer to subsidise condensing boilers or wall insulation. But they have no incentives to offer energy services agreements with customers - providing them with energy-saving improvements and then making a flat quarterly charge for fuel supply over several years - when people have been given the inalienable right to desert them for another supplier at 28 days' notice.

In other words, if it is to put Britain on the road to cutting greenhouse gas emissions by 60 per cent by 2050, as it hopes, the government may have to achieve a profound cultural change. Britain has some of the biggest supplies of renewable energy in Europe - though not the sunniest country, we are the windiest and, being an island, we are surrounded by tides and waves - yet we make less use of it (it accounts for 1.3 per cent of our electricity) than almost anybody else. This is largely because we are unwilling to bear the cost of developing it, either through public subsidies - the white paper's pledge of £60m for research is one-tenth of the money given to bail out British Energy's shareholders last autumn - or through higher energy prices. New Labour has an excellent vision; all it has to do now is find ways to pay for it.

Errors on the right side

On 5 March, we commemorate (celebrate?) the 50th anniversary of Joseph Stalin's death. We must tread carefully. Some sections of the left still hold Uncle Joe in the same respect and reverence that others hold the late Queen Mother. His admirers once included the late Kingsley Amis, Doris Lessing and the current Labour chairman, John Reid. But Stalin was responsible for what are politely called "errors". There were - estimates vary - between six and 20 million of these errors. Still, though nobody now bothers to praise Stalin as a socialist visionary and theorist, he was on our side in the Second World War. As was Saddam Hussein in the 1980s and as is (it is John Reid who makes the comparison on page 22) George W Bush now. The moral implications would tax the combined wisdom of the Pope and Tony Blair; but it seems safe to say that, if a leader is prone to errors, he had best get on the right side at the right time.

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