Now we know: £155bn: the cost of new nuclear power to consumers

It has been a bad week for nuclear power and the prospects of building new power stations.

Last week, Cumbria County Council voted against the area being used as a deep geological dump for existing nuclear waste, sending the whole process of looking for something to do with the country's stockpile back to the drawing board.

Looking after this existing waste takes up more than half of the annual budget of the Department for Energy and Climate Change. That's £1.6bn of public money every year.

On Monday, the House of Commons Public Accounts Committee published a damning report on the management of this waste, which said that "deadlines for cleaning up Sellafield have been missed, while total lifetime costs for decommissioning the site continue to rise and now stand at £67.5bn".

Margaret Hodge, its Chair, noted that: "taxpayers will have to foot the bill" and they "are not getting a good deal". Last year the consortium tasked with sorting out the mess, was rewarded with £54m in fees, despite only two out of 14 major projects being on track.

Also on Monday, Centrica announced it was ending its partnership with EDF, writing off a massive £200m and launching a share buy-back scheme to return another £500m of unused capital to its investors. As with RWE and E.ON last year, and, as Martin Horwood, MP, put it, "like any sane investor in my view, it has decided that it is not going to touch these new nuclear plans with a bargepole".

Finally, yesterday, MPs on the House of Commons Backbench Business Committee debated the question of the subsidy-by-another-name for new nuclear build in this country, contracts for difference, floated in the Energy Bill, but lacking detail of any sort.

The energy chief executive of Electricité de France, Vincent de Rivaz, told the Financial Times that the last thing stopping them going ahead with building a new nuclear plant at Hinckley and Sizewell “is the contract for difference. Once we have that, we’ll have a compelling investment case to attract partners into the project”.

In other words, as Martin Horwood told MPs, “If you don’t subsidise us, there is no business case.”

How much is EDF asking for? The negotiations have so far been shrouded in secrecy, but for the first time, some figures came out in yesterday's debate.

According to the Energy Fair group of energy consultants and academics, the real cost of nuclear power is at least £200 per MWh. This is much more than the cost of offshore wind power (140 per MWh) or that of onshore wind power (£90 MWh).

Based on this, EDF might be asking for something as high as £165 per MWh for the strike price. A similar figure comes from Steve Thomas of Greenwich University and Peter Atherton of Citi: a strike cost price of £161 per megawatt.

This compares to today’s wholesale price for electricity of around £51 per megawatt.

The government would have to enter into a 30-year contract life for the two proposed plants at Hinkley and Sizewell.

Over this period, then, the total cost to householders and businesses or taxpayers would be £155bn by 2050. That is without any of the additional costs, such as insurance and accident protection, dealing with waste, etc.

As Mike Weatherley MP said yesterday: "Imagine the renewable energy industry if we had invested over £155bn in it".

Much of this cash would leave the country as EDF is based in France.

We are talking about not some new technology like tidal power, but a mature and not very competitive industry started in 1956.

MPs were asking for the Public Accounts Committee to scrutinise the economic case for nuclear new build and contracts for difference. Unfortunately, its chair, Margaret Hodge told them that, much as she would like to do this, she couldn't, because the committee can only examine contracts after they have been signed. In this case, that would be too late.

MPs bewailed the lack of information that Parliament had been given about the negotiations with the EDF. Joan Walley said: "It is impossible to understand how Government policy is being taken forward in this area, because of the complete lack of transparency and of an evidence base."

This led Ed Davey to come before MPs and pledge that the House would be told the nature of any contract agreed with EDF before it were signed. Then why haven't they done that already?

Let's be clear, the Treasury’s levy control framework, which caps the costs that can be added to consumers’ bills, currently specifies a figure of £2.6bn a year. There are estimates that the cap would have to rise to £12.5bn or more to provide 16 GW of nuclear power by 2025.

I don't think the Treasury is going to agree to this.

EDF's Olkiluoto plant in Finland was begun in 2005 and should have gone on line in 2009. It is six years overdue and €4.3bn over budget. Its Flamanville facility is now four years late and and €4.8bn over budget.

Clearly, new nuclear cannot be built without a subsidy. Therefore, it should not go ahead at all. Instead, it should yield to other forms of energy, particularly renewable energy.

Ed Davey promised yesterday that "each contract will need to deliver value for money for the consumer and be compatible with state-aid rules". On present evidence, EDF is a not going to deliver this.

Waiting in the wings are Chinese companies. And do we really want state-owned Chinese companies entering into the British energy market and being privy to our nuclear secrets?

The village that took on the planning system - and won

Director Helen Iles at the premier of Living In the Future.

Last week, a remarkable film sold out in all theatres in which it premiered, and I was lucky enough to get a ticket.

It tells the story of a five-year battle by ordinary people fed up with not having access to housing that they could afford, who wanted to build affordable, ecologically-sound housing for themselves on land which they owned.

The story began when nine families occupying 35 acres of land in South Wales innocently submitted boxes of detailed architectural designs and plans to their local council, seeking approval, which was initially met with hostility. The leader of the council is filmed saying: "Not now, not ever. Never!" as he rejected their application.

Their battle eventually succeeded, and resulted not only in a change in planning policy in that council, which has been adopted throughout Wales, thanks to the support of Wales' former Environment Minister, Jane Davidson, but a campaign to change the Building Regulations themselves, which, at present, are totally unfit for the purpose of enabling this type of architecture.

The film is Living In The Future. After the screening I talked to the director, Helen Iles, who has spent several years following, and filming, the development of this project.

The organisation involved, Lammas, set up an eco-village, Tir y Gafel, and are using it as a pioneering project to inspire others to do the same throughout the country.

It contains the first buildings in the country that are of ‘low impact’ and built with planning permission in accordance with Building Regulations.

These buildings use traditional methods of construction: timber frame, round houses, straw bale, and all natural materials: sheeps' wool for insulation, roundwood, mud.

Buildings for all of the families and a community building were constructed for the astonishingly low total cost of about £70,000. Of course, much of the labour was free, coming from the many volunteers who turned up to help.

The local council has stipulated that within three years 75% of the settlement's income must be self generated from the land, as a planning condition. This is a target the village’s inhabitants are still struggling to meet.

I asked Helen why she chose to focus on the planning issue for the substance of her movie. "It is incredibly hard to get councils to understand this type of settlement and building," she said.

"Not only that, but the Building Regulations are geared to conventional types of construction. If, for example, people want to have an outside composting toilet, then officials say: "Why? Surely we've left all that behind!'"

Similar issues apply to the choice of building materials and sewage treatment using reedbeds.

In fact, when the Building Enforcement Officers visited the site they came up with a list of hundreds of things that should have been done. In the end, these were whittled down to a few that were relatively easy to deal with, compared, that is, to knocking the buildings down and starting all over again.

You would class the people pursuing this dream as hippies. But I was reminded of the early days of the Centre for Alternative Technology, where I used to work. This started in much the same way, as an experiment in sustainable living in the early ‘70s, and was also founded by a peculiar mixture of hippies and upper-class dropouts.

The solutions that they pioneered are now mainstream simply because the mainstream has recognised the necessity of making them so.

I am confident that, while the nature of the buildings might change a little, and that the vast majority of people will not live in this kind of housing, a great many do want to live closer to nature, and in buildings that are softer and friendlier which they can design themselves and which are much, much cheaper.

With so many people needing affordable housing, you can hardly argue that there is no demand. The degree of interest in this type of living is evidenced by how popular the film has proved last week.

What is obvious from watching the film is the extreme stress suffered by these pioneers as they struggle not only with bullying of families and growing food, but building their homes and dealing with a non-comprehending bureaucracy.

They were lucky to have a friend in Jane Davidson.

"Jane was a visionary herself," said Helen. "She came and listened to the people at Lammas. She always listened to people. She was the best Environment Minister Wales has ever had. Most of her policies came from the ground up."

Sadly, Jane retired from politics and the Welsh Assembly Government to concentrate on her smallholding, and is now Director of the Wales Institute for Sustainability at the local Trinity St David University.

But the legacy she has left includes the vision of One Planet Living, which underpins the Welsh Assembly Government's Technical Advice Note 6 "Planning For Sustainable Rural Communities", part of Wales' comprehensive planning policy in line with its constitutional commitment to sustainable development, something which makes Wales unique in the whole world.

Planning officers everywhere deserve to take note of the experience of Pembrokeshire and the Welsh Assembly Government. Largely unseen by the majority, a quiet revolution is taking place.

At some point other communities will spring up in other parts of the country.

The film, admirably financed by the Welsh Assembly Government, is available under Creative Commons principles, i.e. it has no copyright, but the makers would appreciate a donation or the payment of a voluntary fee for public showings.

I recommend you to view it, visit the eco-village, and support the campaign to get the Building Regulations changed.

It's Europe that has made our land more green and pleasant

Do you think that the UK's membership of the European Union is a Good Thing or a Bad Thing? If a referendum were held on the UK's membership, how do you think you would vote?

These are the questions that David Cameron is addressing in his speech on Europe, and that are asked in public polling surveys on this most touchy of subjects.

According to one recent survey, which asked just these questions, over 56% would "probably or definitely" answer that they would vote to leave, and 45% think that Britain's membership is a Bad Thing. Only 28% believe it is Good for the country.

But the answer you get depends on the question you ask.

Suppose a pollster asked you this question:

Are you grateful that we have clean beaches?

Or how about:

Is legislation to keep our water and air clean from industrial pollution a good thing?

What about:

Do you think it is a good idea to set targets for manufacturers to make their products consume less energy?

I am willing to bet that well over three quarters of the population would answer yes to all of these questions.

Then the polling company might ask the question:

Are you aware that all of the above are controlled by laws emanating from Europe that have been accepted by the British government?

I am willing to bet that well over three quarters of the population would answer no to that question.

In this debate on Europe we hear a lot from the business lobby about red tape from Europe holding back growth.

As if, were we tomorrow to cast off from the continental landmass, like a hot air balloon we would rise majestically into a sky of profit having jettisoned the ballast of legal compliance.

It is never mentioned exactly which laws are supposed to be jettisoned.

Even the coalition government's own campaign to cut red tape, in which the Department for Environment, Farming and Rural Affairs has played an enthusiastic role, has actually found little besides ancient and redundant legislation that it can bury without affecting health and ecosystems in a way that would cause public outrage.

It is precisely our membership of the European Union that has forced business and agriculture in this country to take care of our environment and protect our health, to safeguard species and habitats from the otherwise careless activities associated with the production of goods and wealth, energy and employment.

These are successes that figure high on people's list of priorities. Breaches of, say, pollution laws, occurring on their doorsteps trigger howls of anguish and outrage.

The Bathing Water Directive protects our beaches. Directives like the Groundwater, Habitats, Industrial Emissions, Landfill, Nitrates and Integrated Pollution Prevention and Control Directive protect us, our children, families and neighbourhoods from dangerous pollution.

Do UKIP and Eurosceptic MPs in all parties wish to abolish all of these as they abandon Europe?

Do they, perhaps, want to make Britain the continent's 'dirty old man'?

Let me ask you: are these protections, instead, not something to celebrate?

We can legitimately ask that, if our national government had not been not forced by Brussels to incorporate these laws into national legislation, whether it would have done so, and indeed whether they would be enforced, and by whom?

Think of how many times Britain has been taken to court for breaches of environmental laws, for example in the case of dirty beaches.

It is because of Europe that raw sewage is no longer poured straight into the sea and our rivers and waterways.

Even now, London is under threat of prosecution from Europe for breaches of air pollution legislation.

These foreigners should not be sticking their noses into our business, you say? Who else is going to protect our environment?

If you want us to leave Europe then you have to be clear on this.

That 'the environment', meaning weather, sea currents, migrating birds and so on, does not respect international boundaries is precisely the reason why we need a continent-wide protection regime.

And it is because it has set, and is due to meet as a bloc, its targets for the reduction of greenhouse gas emissions, for growth in renewable energy, and for increases in the energy efficiency of products made within its boundaries, in its fight against the worst ravages of climate change, that Europe can speak with a louder and more authoritative voice at global climate change talks.

The Waste Electrical and Electronic Equipment Directive and the Landfill Directive encourage recycling. The ambition of the Water Framework Directive is to protect our waterways.

I am sorry, but unless you can convince me that, outside of Europe, we would introduce protection at least as good as these for the environment, and, even more importantly, enforce all of these, I will vote overwhelmingly for us to stay within the European Union.

I'm all for simplifying red tape. But let's hear it for European green tape. Without it, our environment would be even more despoiled than it is already.

The case for the Severn tidal barrage must be improved

Former Welsh Secretary Peter Hain, MP for Neath near Swansea, has given MPs an enthusiastic account of the proposed design by Hafren Power for a tidal barrage across the Severn estuary twice recently.

The first time was in the Commons debate on the Energy Bill and the second was last Thursday in front of the Select Committee on Energy and Climate Change, which is pursuing an enquiry into the scheme.

I have to declare an interest here: I was commissioned to help write a document advocating the advantages of the scheme at an early stage.

I think it is a very exciting project. But at the same time I want to see any negative environmental effects of the scheme minimised.

It's now well known that this is a completely different proposition from the previous tidal barrage proposal that was rejected in 2010.

For example, it is claimed that the turbines are fish friendly, because they operate at a lower speed, enabling fish to swim both ways through them.

These new turbines will also work on the ebb and flow of the tide, meaning they can generate power 24/7.

Peter Hain told the Committee that the developers, Hafren Power, are prepared to settle for a strike price for the electricity generated that is the same as that received by offshore wind under contracts for difference (CfD). That, if true, is very reasonable.

The claim by the developers is that it will generate 5% of the UK's electricity needs, about the same as three new nuclear power stations and 7,000 wind turbines.

But it will last a lot longer. Like any hydroelectric scheme, it will last for up to 120 years, possibly more, and for most of its life it will therefore produce electricity 75% cheaper than coal or gas. Another considerable advantage.

No Treasury (taxpayers') money will be required to help finance it. However, it will use up a considerable amount of the Levy Control Framework. DECC has already indicated that this could be a concern for other low carbon technologies, for which little money would be left. Why put all one's eggs in one project basket?

The developers claim that the project will remove the need for millions of pounds worth of flood defences being built, because in itself it will protect much of the area from the risk of sea level rise and storm surges. They have even offered to build a Bridgwater bund to protect the Somerset Levels, which are very vulnerable.

However, this money saved cannot be offset against the Levy Control Framework, which is passed on to electricity consumers. There is no way to compensate them for the money saved from not spending on flood defences.

Nor has Hafren demonstrated that the project will protect areas upstream of the barrage from floodwaters coming down river.

It claims that it will generate 50,000 jobs, and on this basis it has won the support of Martin Mansfield, General Secretary of the Welsh TUC and Andy Richards, Wales Secretary for the Unite Union. However there is no supporting evidence explaining how so many jobs can be created.

The Angling Trust is adamant that the technology as so far presented to it is not safe for fish. Other conservation groups equally remain to be convinced.

The Habitats Directive requires that any designated ecology threatened by development must be compensated for elsewhere. In order to comply, the estuary would have to be stripped of its special status by application to the European Commission, a process which could take years due to the scientific evidence that would need to be collected and the natural inertia of the Commission.

Hain, in giving his evidence, was bending over backwards to help appease these objections. The man is staking his reputation as an MP on a private company's single project.

It would be tragic if a perfectly good opportunity to tackle climate change, energy security, promote renewable energy and stimulate the economy to the extent that this project has the potential to, were to be scuppered by the traditional, knee-jerk, objections of the traditional wing of the conservation movement.

After all, it is projected that between 10 and 20% of the habitat within the Severn estuary will be lost due to climate change and other factors anyway, in the future. The barrage proposal claims that 25% will be lost. This leaves a net loss of between 5 and 15%, which is perhaps not so significant when comparing to the environmental benefits.

The company has committed to engage with the Angling Trust, the RSPB and other conservation groups in developing the design. It has invited the Trust to test the turbine with them to see if it is a danger to fish. Together they can perhaps develop an even more fish friendly version of the turbine.

Similarly, a war has been growing between Bristol and Port Talbot ports over their mutual future viability, once the barrage is built, and employment prospects. They need to talk to each other and engage with the project to make sure that everyone benefits and no one loses out.

The project also has the potential to divide the south-west from South Wales, over competition for jobs. Developers must make sure that each side benefits here too.

This is a project with such potentially massive benefits that it cannot be dismissed easily. Its impacts will be correspondingly huge.

All big projects represent big change, and this scares people. They find it difficult to imagine what the finished product will be like and how it will affect the surrounding area.

All affected parties must therefore come together and explore it to see if together they can find a mutually acceptable solution.

It behoves Hafren to listen carefully to them all, to take their concerns on board and work with them.

All of this will take time. But it is the only environmentally and socially acceptable way to proceed.

2013 will be the year energy management grows up

The Government continues to claim that it is delivering certainty to potential investors in low carbon technology, while these selfsame investors continue to say they don't have it.

The new Energy Bill and the Finance Bill 2013 all contain reams of assurances or regulations intended to balance the competing requirements of the two wings of the Coalition. This is represented in Westminster shorthand by Osborne, Energy Minister John Hayes and Environment Secretary Owen Patersen and 100 or so back-bench MPs on the one hand, and Greg Barker plus many Lib-Dem MPs on the other hand. Energy Secretary Ed Davey leans towards the latter rather than the former grouping, but manages to defend DECC's turf at least some of the time against the parsimonious tendency of the Treasury.

I'm sorry, I'll rephrase that: the above two documents are intended to balance the competing requirements of keeping the lights on for the UK, improving energy security and combating climate change.

Like the resolution called The Doha Gateway Package, which came out of the latest UNFCCC climate talks (vague ideas to do little until 2015), they represent both a victory for business-as-usual and a beanfest for legions of accountants and consultants who will be needed to interpret them for everyone else. In failing to tackle the dangers revealed by the latest evidence of the rate of climate change, they will satisfy no one but these players.

As the world races to increasingly certain climate disaster later this century, governments' payoffs to the bankers to compensate them for the mistakes they themselves made five years ago, mean that they have a plausible excuse not to cough up the mere 1% of global GDP required to ameliorate and mitigate the worst excesses of climate change.

Even as Chancellor George Osborne simplifies the Carbon Reduction Commitment, for the benefit of businesses affected by it, he introduces even more complex rules, governing the Carbon Price Support (CPS), Climate Change Levy (CCL), Carbon Price Floor (CPF), Capacity Payments and Feed-in Tariffs with Contracts for Difference, terms only civil servants could have dreamed up.

And this is after business complained that an earlier version of the Bill was too complicated.

The Gas Strategy promises support for gas extraction but gives no support for a new gas power station.

As I prophesised at the beginning of this year, the prognosis for concrete action on the construction of a new nuclear power station is still unclear, a year later, despite approval being granted by the Health and Safety Executive for NNB GenCo's European Pressurised Water Reactor design, because no one knows from where the money to pay for it will come.

Offshore wind power remains a reasonably safe bet, but only for turbines erected before 2018, when the Renewables Obligation gives way to the carbon price floor. And no one knows yet how that will work, because the price of carbon insists on staying frustratingly low.

All of which means that at the end of 2012, hopes are pinned on the one set of actions that is easier and cheaper to attain than any of the above. This has been a dark horse, largely ignored by government for decades, but now racing up on the outside with a chance to clinch a win, if the imaginative proposals in a recent consultation document are implemented.

I'm talking about energy efficiency of course. Demand reduction is already included in the Energy Bill's Capacity Market, but the suggestion of businesses and individuals being given premium payments for each kilowatt–hour saved by installing energy-efficient equipment are the centrepoint of last November's proposals for reducing energy demand, published by DECC.

The payments would work in a similar way to feed-in tariffs, but instead of being paid for generating renewable electricity, bill-payers would be paid for not consuming electricity, a solution that is, paradoxically, cheaper for energy companies than building new generators. It was first pioneered by Californian utility Pacific Gas and Electric in the 1970s.

The consultation contains other exciting ideas: an energy supplier obligation for the non-domestic sector to encourage energy companies to insulate business premises, similar to the Energy Company Obligation in the domestic sector, and financial incentives to encourage the replacement of out of date equipment like motors, boilers and fridges with new, more efficient versions.

Financiers say they are seeking certainty from Government. The CBI complains at the length of time it is taking for policies to become law. The Federation of Small Businesses and the manufacturers’ organisation, the EEF, complain about carbon taxes.

But investing in energy efficiency has always been able to provide certainty. Marginal abatement cost curves of energy measures, like those provided by DECC, McKinsey, Mott MacDonald or the Committee on Climate Change, consistently put it up front, on the left, below the line. Sure, different measures have different the internal rates of return, and they are dependent on future energy prices and inflation rates. Yet this is familiar territory for business.

It's just that energy management has not so far attracted the attention of senior executives. But from now on it must and will increasingly do so, especially if these proposals, which we should all back, are made law.

The absolute conclusion is: we can wait forever for government to act, and when it does it will never satisfy each and every one of us. But the logic of energy management, correctly applied, will always yield investor certainty. It will save carbon, save money, and create jobs.

Doha wins 'damage aid' for poor countries

For the first time, developing countries have won recognition of the danger they face from climate change, securing a promise from developing countries that they will receive funding to repair the "loss and damage" incurred.

US negotiators fought hard against this proposal and made sure no term implying legal liability was used, to avoid the possibility of litigation; the money will instead be described as aid. It is already being called 'damage aid'.

But “climate finance is not charity or foreign aid,” said Brandon Wu, Senior Policy Advisor, ActionAid. "The Doha outcome completely fails to provide clarity. Lacking concrete numbers and dates, it lets rich countries off the hook. Developing countries have no idea whether climate finance will go up or down, or even whether it will reliably flow."

Ronald Jumeau, the Seychelles negotiator, told his American counterpart: "If we had had more ambition [on emissions cuts from rich countries], we would not have to ask for so much [money] for adaptation. If there had been more money for adaptation [to climate change], we would not be looking for money for loss and damage. What's next? Loss of our islands?"

Observers now expect armies of consultancies to spring up, which will debate from both sides the scientific basis of attributing specific extreme events and weather effects to climate change

The Doha Gateway Package

“What we have on the table is extremely weak. I think it worse than people expected,” concluded Hoda Baraka, Arab World Project, Greenpeace at the end of the final 36-hour session of the fortnight-long UN climate change talks among 195 nations in Qatar.

The other headline results from what is called the Doha Gateway Package, are:

negotiators resolved the Second Commitment Period of the Kyoto Protocol by adopting amendments;

concluded the long-term cooperative action (LCA) track, including rules around finance, accounting and review;

and agreed to move forward with the Durban Agreement, with a workplan for 2013. This will begin negotiating the global legally binding agreement, which is scheduled to be signed in 2015 and will come into force five years later.

The final Doha Gateway text was rushed through the last plenary by the Qatari host over objections. "Saving the process; killing the planet", as the Sierra Student Coalition's International Committee put it.

Two activists, Libyan Raied Gheblawi, 22, and Algerian Mohamed Anis Amirouche, 19, were deported from Qatar on Thursday after holding up a banner in the central meeting point reading "Qatar, why host not lead?"

Kyoto Protocol

The Doha outcome confirmed the second commitment period of the Kyoto Protocol starting on 1 January 2013. Its participants, however, account only for around 14% of world emissions.

It will run for eight years, up to the entry into force of a promised new global legal agreement in 2020.

The adopted target by the EU and Croatia and Iceland, of cutting emissions by 20% of 1990 levels by 2020, is open to being increased to 30%. The targets of all participating countries will be revisited by 2014 with a view to considering raising ambitions.

The EU and other countries taking on targets will have a limit on the number of purchases they can make of surplus emission allowances ('AAUs') left over from the first commitment period.

The EU Member States, and all other potential buyers (Australia, Japan, Liechtenstein, Monaco, New Zealand, Norway and Switzerland) have declared anyway that they will not purchase AAUs carried over from the first period.

EU finance

The agreement leaves the EU as the world's leading provider of official development assistance and climate finance to developing countries.

The bloc had pledged €7.2 billion in 'fast start' finance for the period 2010-12 and has assured its developing country partners that climate finance will continue after this year.

Several EU Member States and other developed countries such as the UK announced specific finance pledges for 2013, and in some cases up to 2015.

The decisions also extend a work programme on long-term finance for a year, with the aim of helping developed countries identify pathways for scaling up climate finance to $100 billion per year by 2020 from public, private and alternative sources.

Greg Barker, UK Energy and Climate Change Minister, and Dr. Sultan Al Jaber, CEO of UAE’s renewable energy company Masdar, announced they will launch a new roundtable for the world’s largest public and private sector investors in low carbon industries during Abu Dhabi Sustainability Week, in January. This aims to scale up investment to combat climate change in developing economies.

Barker said: “Alongside the formal negotiations taking place here in Doha, there’s a formidable amount of informal discussion around how to mobilise at scale the private finance needed to tackle climate change".

The winners at Doha

“Any government walking out here saying it is a success is suffering from a terrible case of cognitive dissonance,” said Kumi Naidoo, executive director, Greenpeace, articulating the feelings of most leaving the conference.

"They have to align the political reality of these conversations with what the science says. This failure is a betrayal of the people in the Philippines and all the other people who face climate impacts now."

Who was to blame for this failure? “It was only a handful of countries, such as Poland, Russia, Canada, the US and Japan, who held the negotiations to ransom,” thought Samantha Smith, leader of WWF’s Global Climate and Energy Initiative.

Asad Rehman, Friends of the Earth International spokesperson in Qatar, added: "most notably the US”. Sophia McNab, UK Youth Climate Coalition delegate, went even further: “This text is a win for the USA, developed countries and fossil fuel interests. It’s a betrayal of all vulnerable nations, and our future.”

“The coal industry won here, the oil industry won here,” agreed Alden Meyer, director of strategy and policy, Union of Concerned Scientists. "You saw on display the power of these industries and their short term profit to influence the governments of the world."

Wael Hmaidan, director of Climate Action Network International, said: “The path forward is actually quite clear: we have the technology and know-how. But we also need people in all regions of the world to demand leadership from their governments”.

Why Doha failed, and what to do about it

The blame for the failure at Doha to deliver a significant breakthrough to save the future world from devastating consequences of climate change once again lies with the lobbying power of the fossil fuel industry and the failure of politicians to act responsibly, in line with the scientific evidence.

In America in particular, but also in Britain, this industry is allowed to lobby and fund politicians and political parties, and in return they are expected to deliver political decisions in their favour. This is a far cry from responsible, participative democracy that citizens expect and need.

The website opensecrets.org documents the amount of money spent by oil and gas companies lobbying American politicians and financing their election campaigns. The top five companies spent the huge total of $42,470,000 on lobbying in 2012. They are: Royal Dutch Shell, Exxon Mobil, Koch Industries, Chevron and BP.

20 oil companies donated a massive $25,429,233 in political contributions during the last American election. The majority of it went to the Republicans, but enough went to the Democrats to secure the required response, given the make-up of Congress.

The result in Doha reveals what they got in exchange for this cash. For them, it represents a bargain.

For Alden Meyer, director of strategy and policy, Union of Concerned Scientists, COP18 wasn't an environmental conference. It was "a trade fair" on behalf of the oil and gas industry which was there to protect its short-term profits.

Hence, the local paper's headline at the weekend: "Qatar is victory for the climate". This is sheer Orwellian spin, as in 1984's Ministry of Peace being actually responsible for war.

Qatar was widely criticised during the talks for failing to set clear targets for reducing its own emissions. Instead it argues that its liquefied natural gas exports mean it is helping other nations move away from using more polluting coal. This is like saying heroin dealing is okay because it's not as addictive as crack cocaine.

The fact that coal-dependent Poland is to host next year's talks means the takeover of the UN negotiation process by the fossil fuel industry is complete.

So if we can expect nothing of these talks, what can we do? Environmentalists and activists must realise that instead change has to come at a local and regional level.

I am just reading an excellent book, The Leaderless Revolution, by Carne Ross, a former diplomat who was Britain's Foreign Office representative at the United Nations in the run-up to the Iraq war.

His analysis of these types of international negotiations is spot on, and it comes from real life experience.

Entrenched positions and irresponsible decisions are the direct result of decision-makers being both far removed from the impact of their actions and being completely unaccountable for their decisions.

He quotes research showing that even when people with dramatically opposed opinions in a given community come together to make a decision affecting all of them, they will reach a reasonable and appropriate solution only if they know that they have genuine responsibility for the result.

That is to say, if the consequences of their decision affects them or others close to them directly.

Time and again, Ross cites examples where his own reports to ministers resulted in the deaths of innocent civilians in countries that he had never visited, and he himself was completely unaccountable for these deaths, just as they were.

He talks of his undying shame that he took such decisions so lightly. It took him a long time to come to his senses and realise that none of his reports for Whitehall, or the policies adopted by politicians based on his and many similar reports, went anywhere near to solving the problems that they were intended to address, such as making the world a safer place.

In fact, they had the exact opposite effect.

Politicians, he says, are incapable of doing the right thing because they cannot comprehend and arbitrate the forces that we assume, and which they persuade us, they are able to deal with.

Reality is too complex, they are preoccupied with many other concerns, including whether they will win the next election, and their hands are often tied.

An argument in a community today in Britain, over whether a windfarm should be sited nearby, frequently results in acrimonious and polarised debate, because the members of the community are not themselves responsible for the windfarm, or indeed for any form of energy supply to their community.

If they had to decide how to provide all the heat and power their community needed, if they had secured the finance themselves, if they had decided or been given a set of conditions, such as that whatever generation plant they chose should be as low carbon as possible, and if they could manage the plant afterwards, and received the rewards of their investment themselves, then the likelihood is that they would reach a reasonable solution.

In the debate, they would be prepared to listen to each other's point of view and take them into account in the process.

But communities are rarely given that responsibility.

Ross says that as a result we ourselves must take such responsibility, as, for example, citizens are doing with the Isle of Wight's Ecoisland project.

We give political power away at our peril, and when we do there is no guarantee it will result in a better situation than the one we can make on our own.

This would be true Localism, but far from what David Cameron intended when he made it a plank of his election manifesto.

His form of localism was a hollow promise. No politician will ever, in reality, give power away to the people. Why on earth would they ask you to vote for them if so?

Instead, they make promises that they know we want to believe, like “Yes we can” and ‘the greenest government ever”, and we do vote for them.

We are always let down.

Ross decries internet activism also, saying that the technology it uses is too easily appropriated by commerce and politicians.

Instead, he proposes, simply, talking to others in your community, and moving on from there.

It’s where the power revolution has to start. After Doha, it’s the only place to start.

Why Doha failed, and what to do about it

The blame for the failure at Doha to deliver a significant breakthrough to save the future world from devastating consequences of climate change once again lies with the lobbying power of the fossil fuel industry and the failure of politicians to act responsibly, in line with the scientific evidence.

In America in particular, but also in Britain, this industry is allowed to lobby and fund politicians and political parties, and in return they are expected to deliver political decisions in their favour. This is a far cry from responsible, participative democracy that citizens expect and need.

The website opensecrets.org documents the amount of money spent by oil and gas companies lobbying American politicians and financing their election campaigns. The top five companies spent the huge total of $42,470,000 on lobbying in 2012. They are: Royal Dutch Shell, Exxon Mobil, Koch Industries, Chevron and BP.

20 oil companies donated a massive $25,429,233 in political contributions during the last American election. The majority of it went to the Republicans, but enough went to the Democrats to secure the required response, given the make-up of Congress.

The result in Doha reveals what they got in exchange for this cash. For them, it represents a bargain.

For Alden Meyer, director of strategy and policy, Union of Concerned Scientists, COP18 wasn't an environmental conference. It was "a trade fair" on behalf of the oil and gas industry which was there to protect its short-term profits.

Hence, the local paper's headline at the weekend: "Qatar is victory for the climate". This is sheer Orwellian spin, as in 1984's Ministry of Peace being actually responsible for war.

Qatar was widely criticised during the talks for failing to set clear targets for reducing its own emissions. Instead it argues that its liquefied natural gas exports mean it is helping other nations move away from using more polluting coal. This is like saying heroin dealing is okay because it's not as addictive as crack cocaine.

The fact that coal-dependent Poland is to host next year's talks means the takeover of the UN negotiation process by the fossil fuel industry is complete.

So if we can expect nothing of these talks, what can we do? Environmentalists and activists must realise that instead change has to come at a local and regional level.

I am just reading an excellent book, The Leaderless Revolution, by Carne Ross, a former diplomat who was Britain's Foreign Office representative at the United Nations in the run-up to the Iraq war.

His analysis of these types of international negotiations is spot on, and it comes from real life experience.

Entrenched positions and irresponsible decisions are the direct result of decision-makers being both far removed from the impact of their actions and being completely unaccountable for their decisions.

He quotes research showing that even when people with dramatically opposed opinions in a given community come together to make a decision affecting all of them, they will reach a reasonable and appropriate solution only if they know that they have genuine responsibility for the result.

That is to say, if the consequences of their decision affects them or others close to them directly.

Time and again, Ross cites examples where his own reports to ministers resulted in the deaths of innocent civilians in countries that he had never visited, and he himself was completely unaccountable for these deaths just as they were.

He talks of his undying shame that he took such decisions so lightly. It took him a long time to come to his senses and realise that none of his reports for Whitehall, or the policies adopted by politicians based on his and many similar reports, went anywhere near to solving the problems that they were intended to address, such as making the world a safer place.

In fact, they had the exact opposite effect.

Politicians, he says, are incapable of doing the right thing because they cannot comprehend and arbitrate the forces that we assume, and which they persuade us, they are able to deal with.

Reality is too complex, they are preoccupied with many other concerns, including whether they will win the next election, and their hands are often tied.

An argument in a community today in Britain, over whether a windfarm should be sited nearby, frequently results in acrimonious and polarised debate, because the members of the community are not themselves responsible for the windfarm, or indeed for any form of energy supply to their community.

If they had to decide how to provide all the heat and power their community needed, if they had secured the finance themselves, if they had decided or been given a set of conditions, such as that whatever generation plant they chose should be as a low carbon as possible, and if they could manage the plant afterwards, and received the rewards of their investment themselves, then the likelihood is that they would reach a reasonable solution.

In the debate, they would be prepared to listen to each other's point of view and take them into account in the process.

But communities are rarely given that responsibility.

Ross says that as a result we ourselves must take such responsibility, as, for example, citizens are doing with the Isle of Wight's Ecoisland project.

We give political power away at our peril, and when we do there is no guarantee it will result in a better situation than the one we can make on our own.

This would be true Localism, but far from what David Cameron intended when he made it a plank of his election manifesto.

His form of localism was a hollow promise. No politician will ever, in reality, give power away to the people. Why on earth would they ask you to vote for them if so?

Instead, they make promises that they know we want to believe, like “Yes we can” and ‘the greenest government ever”, and we do vote for them.

We are always let down.

Ross decries internet activism also, saying that the technology it uses is too easily appropriated by commerce and politicians.

Instead, he proposes, simply, talking to others in your community, and moving on from there.

It’s where the power revolution has to start. After Doha, it’s the only place to start.

Doha: Climate negotiators fail to meet the scientific challenge

Young UNICEF UK campaigners asking Ed Davey to speak up for children before he left for the UN climate change talks in Doha. Photo: Rosie Reed Gold/UNICEF.

On the last day, talks at Doha aimed at securing a global agreement to tackle climate change are providing scant hope, although individual announcements from nations on the sidelines provide some progress.

The central issue, as always, is fairness over who pays.

US lead negotiator, Todd Stern, told the plenary assembly that he wanted to see “the principle of equity and common but differentiated responsibilities and respective capabilities" provide the basis of agreement, but that "unless we can find common ground on that principle and the way in which it should apply in the world of the 2020s, we won’t succeed in producing a new Durban Platform agreement”.

The U.S. has a target of reducing emissions by 17% by 2020 compared to 2005 emissions (equal to just 4% below 1990 levels). Its negotiators said that this is unlikely to change. They say they cannot see a way of getting a global agreement for seven years; until 2020.

Like 85% of nations, the U.S. has spurned extending the Kyoto Protocol, leaving a group led by the European Union and Australia to take this forward. They believe Kyoto is no longer relevant because emerging nations led by China and India will have no targets to curb their soaring emissions from 2013.

Delegates have been repeatedly told how dire prospects are. "If anything, the science is telling us it's now getting warmer quicker than we had previously expected," said UK Energy Secretary Ed Davey, who is in Doha. "Our actions as a world are going slower than we had previously hoped."

"The question of climate management is extremely serious," Laurent Fabius, France's foreign minister, agreed. "It appears we have already exceeded the 2-degree limit. If that is the case, there are absolutely catastrophic consequences. We must react." Tackling climate change is "the new challenge in world diplomacy".

But so far, too few countries are making the kind of commitments to cut emissions that scientists agree would keep global warming below the 2 degrees Celsius limit that is estimated to prevent the most devastating effects of climate change.

Many attending the Doha talks are saying that 4 degrees Celsius of global warming by 2100 looks almost inevitable.

Meanwhile, countries debate who will pay to save the planet.

Qatar has offered no money. National pledges by Germany, Britain, France, the Netherlands, Sweden, Denmark and the EU Commission in Doha total over 6.85 billion euros for the next two years, more than in 2011-12.

The UK will be allocating around £1.8 billion aid money to climate finance up to 2015. Ed Davey, speaking at Doha, reiterated the UK’s support for contributing to the $100 billion a year by 2020 commitment of new and additional funds.

Germany and Britain this week launched the NAMA (Nationally Appropriate Mitigating Actions) Facility, to support countries to implement action against climate change. Ed Davey, pledging £25 million from the International Climate Fund (ICF), said it will “help support those developing countries that are taking ambitious action to close the gap to 2°C". Countries will compete for the funding to support their own projects. One in Mexico will go towards sustainable new housing by establishing the necessary framework conditions.

Hosts Qatar did say they will develop a 1,800 megawatt (MW) solar energy plant in 2014 costing up to $20 billion, mainly to power its desalination plants. The country has no naturally-occurring pure water. It will increase the proportion of its renewable electricity generation to 16% from zero. "We need to diversify our energy mix," said Fahad Bin Mohammed al-Attiya, chairman of the Qatari organizers of climate talks in Doha. Qatar supplies Britain with much of its liquefied natural gas (LNG) and is the world's top exporter. But it has not set any targets for reducing its greenhouse gas emissions.

A senior Saudi Arabia official said his country was taking the climate change issue "seriously. It is implementing carbon capture storage in the world's biggest oilfield, Ghawar, where injecting carbon dioxide back into the field helps to raise pressure and increase oil output, as well as trapping planet-warming gas".

Indonesia announced it has approved a U.N.-led rainforest conservation scheme under Reducing Emissions from Deforestation and Degradation (REDD), that sets aside nearly 80,000 hectares (200,000 acres), much of it carbon-rich peat swamp forest at risk of being felled for palm oil plantations, and rewards its investors, Russian energy giant Gazprom and German insurance firm Allianz, with 104 million tradable carbon offset credits. Each credit represents a metric ton of carbon, worth almost 500 million euros based on current market rates. It is the first scheme of its kind to win formal backing in the country, and the world's first on protecting 'deep peat'.

Back in the U.S., the Obama administration said it is to invest $120 million in developing cheaper batteries for electric vehicles and grid storage. The five year project will establish a research hub with Dow Chemical Co, Applied Materials Inc, Johnson Controls Inc and the Clean Energy Trust.

Still in the U.S., the Federal Energy Regulatory Commission reported that from January to October, 46.2% of new electricity-generating capacity installed was renewable. Wind accounted for 77% of this.

But the reality is that all of these announcements are nothing like what is required; they are like using a bucket to bale out the rising oceans.

"Some sort of agreement will be achieved – it always is," writes observer Giles Parkinson. However, he concludes, "the more that the UN talks fall short of expectations, the more that domestic politics plays into the hands of vested interests".

Next year, coal-dependent Poland will host the talks. Environmentalists expect little progress there either. They are now looking to Paris, which will host the 2015 talks, for realistic progress.

Energy Bill means a new sunrise for renewable energy

A new Energy Bill, two years in the making, will triple investment in renewable energy and mean the end for coal-powered generation.

The Bill commits the Government to supporting low carbon electricity to the tune of £7.6 billion by 2020, over three times the current level of £2.3 billion for 2012-13.

The Carbon Capture and Storage Association, the Nuclear Industry Association and RenewableUK welcomed the introduction of the Bill, saying it "would help to unlock billions in investment in low carbon generation, enable the UK to meet its energy security and climate change targets, and create thousands of jobs".

Solar Trade Association's PV specialist, Ray Noble, said the Bill means that "solar power will be massive" and called for a dedicated strategy for PV, "like gas".

Announcing the Bill in Parliament, Energy and Climate Change Secretary, Ed Davey, said: "The Bill will support the construction of a diverse mix of renewables, new nuclear, gas and CCS, protecting our economy from energy shortfalls. It will stimulate supply chains and support jobs in every part of the country, capitalising on our engineering prowess and our natural resources, cementing the UK’s place at the forefront of clean energy development."

The push for low carbon electricity will add £95 a year to the average household bill by 2020, an increase of 7%.

Much of the support will be delivered through long-term contracts for difference (CfD), designed to guarantee stable revenues for investors in low-carbon energy. They will provide cash for generators of nuclear power and renewables if the market price of electricity drops below a specified strike price. A new Government owned company will act as a single counterparty to the CfDs.

A ‘capacity market’ will encourage investors to build gas-fired power plants to provide back-up for when wind farms are not generating. The System Operator (National Grid) will decide the level of generation capacity it judges is appropriate and then contract for it through an auction four years in advance.

Carbon emissions

An Emissions Performance Standard (EPS) set at a maximum of 450g CO2/kilowatt hour (kWh) will curb the most polluting coal-powered stations; any new coal-fired power station would have to be fitted with carbon emission capturing technology. "This law will mark the end of any plans for new, highly polluting coal-fired power stations in this country," commented Greenpeace political director Joss Garman.

Gas-fired power plants would remain unabated at this level, however, prompting Green Party MP Caroline Lucas to call for amendments to the Bill to rule out a new "dash for gas".

The Bill pushes the date for setting a 2030 decarbonisation range for the power sector, to 2016, once the Climate Change Committee has provided advice on the fifth Carbon Budget, which covers the period 2028 – 2033.

This has prompted calls, led by Conservative Chairman of the Energy and Climate Change Committee, Tim Yeo, for amendments to the Bill that would introduce a decarbonisation target for 2030 straight away, a move supported by Alistair Smith, Chair of the Institution of Mechanical Engineers’ Power Division. He said: “The lack of an emissions target for 2030 leads to longer term uncertainty on clean energy investments."

The central modeling for the Bill assumes a scenario where the carbon intensity of electricity generation is 100g/kWh by 2030. Two further scenarios modelled for comparison are either side of this figure: 200 and 50g/kWh. The latter is the level recommended by the Committee on Climate Change.

Wind farm builder Alstom UK, one of seven companies who wrote to the Government arguing that a decarbonisation target was vital to permit them to locate factories in the UK, issued a statement saying: "We will continue to invest, but the pace is likely to be slower without a decarbonisation target."

Nuclear power

Oversight of the nuclear industry will be enhanced through creating an independent statutory nuclear regulator, the Office for Nuclear Regulation.

Richard George, Greenpeace nuclear campaigner, said: “The coalition agreement pledged not to subsidise new nuclear reactors. Yet the energy bill offers massive public subsidies to anyone willing to build new nuclear reactors."

Energy efficiency

During the passage of the Bill, proposals will be added to ensure energy companies help consumers to get on the best energy tariff, and to promote energy efficiency through electricity demand reduction.

Andrew Kuyk, Director of Sustainability for The Food and Drink Federation (FDF), welcomed the certainty, but wanted to see more detail. "We look forward to engaging in further discussions on how to enable ours and other UK industries to maximise... their energy efficiency in increasingly competitive world markets.”

The emphasis on energy efficiency was also welcomed by the UK Green Building Council, and Brian Smithers, director of Rexel UK, who, however, issued cautions: "Firstly, unless monitoring energy use becomes standard, it will be impossible for homeowners and businesses to understand where the biggest wins can be made.

"Secondly, the British public is relatively unaware of energy saving technologies. An energy efficiency information "hub" will be key to educating consumers and businesses alike about the benefits of measures including LED lighting, automation and efficient heating. However, we can’t just leave this to the energy suppliers."

Further reactions

John Cridland, CBI director-general, said: “Energy-intensive manufacturing is finally getting its place in the sun today, by the exemption from necessary new energy costs. Equally important is the welcome boost the bill gives to investor certainty."

Pöyry’s Richard Slark thought less certainty was given than is present in the Renewables Obligation, which will be phased put in 2018.

The Bill was welcomed by the electricity generation industry. Angela Knight, head of Energy UK, called it: “a big and positive step forward. This means that the huge investment will now start being made in our energy infrastructure and this will create jobs and help economic recovery."

Ernst and Young’s Power & Utilities Partner, Tony Ward, cautioned: "It may not be until autumn 2013 before this Bill reaches the statute book, so maintaining confidence in its safe passage will be vital."

The view from Doha is uninspiring

What we need from our leaders is: inspiration. In Doha, it seems sadly lacking.

If you fly to Doha in Qatar on he Gulf, you pass 35,000 feet over the oilfields of Iran and Iraq.

In the oily blackness of night, hundreds of orange gas flares outshine city lights by a factor of fifty, visible from space.

Kuwait is sparkly island, as is Doha itself, yet another reminder of the power fossil fuel reserves have over the Middle East.

The tiny desert isthmus of Qatar holds not a drop of natural potable water. It makes £106 billion a year from selling oil and gas that hapnes to be under its barren sands. Its residents have the highest per capita income on earth.

They get all their electricity for free. It is used profligately. The urinals in Doha airport are constantly flushed with hot water. All of the country's water has to be desalinated using oil-fired electricity.

It is here, in the Qatar National Conference Centre, where the representatives of most countries in the world have gathered for yet another round of painfully slow, and apparently almost inconsequential, negotiations to curb global levels of greenhouse gas emissions.

The grandfathers of the oil rich elite that runs this state were bedoin, wandering the desert with their tents and camels. Now they own fleets of Lexus 4x4s and Porsches.

I met a senior account manager for a Fortune 400 listed company that supplies process machinery to the oil industry in Kuwait. He held a Jordanian passport and said he believes in climate change. "But what can I do? It's not up to people like me to change the system. Our machinery will work just as well on renewable energy. But here is where the market is".

A wealthy manager of a pipeline maintenance company, in his spotless white schumagg and thoub, told me that he was aware of the talks going on in the conference centre down the road, but for him it was "just another conference". He won't be going.

Next week is one to promote trade, held by the World Chambers Federation, where 12,000 chambers will be represented. He will attend that. Good for business. The following week is a film festival, peddling dreams and escape stories.

All of this is part of the wish of Emir Sheikh Hamad bin Khalifa al Thani, Qatar's ruler, to be a big player on the world stage, to convince the world that Qatar is not just about oil, but culture.

Maybe he does think, like Masdar's leaders, that the game will one day be up for oil. The country is currently spending £20 million, with Chevron and GreenGulf, on a Solar Test Facility, to investigate what technology can best convert the copious amount of solar radiation that falls on this desert land to electricity. It includes a solar desalination plant.

By hosting COP-18, the Emir is hedging his bets. COP-18 means that these annual horse-trading, long-grass-kicking stand-offs have been doing the rounds of nations for eighteen years.

Knowledge of the threat of climate change is not new.

Twenty three years ago, I was asked by Greenpeace Book's John May to write a comic book explaining global warming to young people.

Three years before that, Margaret Thatcher, in the only act for which I unreservedly admire her, alerted world leaders, especially Ronald Reagan, to it.

If only today's world leaders had Maggie's conviction.

At the heart of the story I wrote for John was a conflict between a greedy industrialist and his brother, an enlightened environmentalist. It was based on the Goldsmith brothers, James, the financier and corporate raider, and Ed, the Ecologist magazine's former publisher.

James' son, Zac, is now Conservative MP for Richmond Park, and as good an example of a Green Tory as you will find.

I suppose what I'm saying is, that at the Doha talks, being held in the context of the most dire warnings yet about global temperature rises, it is political leadership that is needed more than ever.

The talks give the impression of being complicated, and they are, but the principles are simple: the developed nations need to cough up and everyone needs to commit.

Politicians need to talk with conviction, echoing President Kennedy with "ask not what the planet can do for you but what you can do for the planet".

Or echoing Churchill, with "We will fight climate change in the factories, in the fields and in the streets. We will never surrender!"

In a word, what we need from our leaders is: inspiration.

In Doha, it seems sadly lacking.

This Energy Bill is all about tax revenues from North Sea gas

The Energy Bill compromise is about revenues to the Treasury to help pay off the budget deficit before the next election.

The position on renewables in Britain stands in stark contrast to that north of the border.

The Scottish Government is hoping for independence after 2014. 90% of Britain's oil and gas is in Scottish territory. The Institute of Fiscal Studies is arguing that revenues after the possible independence would be split between the two nations proportionately on the basis of population.

But oil and gas production dropped 18% last year. It will continue this inexorable decline in years to come.

The Scots know this. That's why they are aiming for 100% renewable electricity by the end of this decade. They reckon they will even have more to spare. Perhaps to sell to England and Wales. At this rate, England and Wales are going to need it.

Perversely, George Osborne, David Cameron and the rest of the Conservatives are determined to hitch the UK's wagon to Qatar, from which most of our gas flows: there was a moment two weeks ago when almost 100% of Britain's gas fired power stations were running on gas imported from that Arab country.

But why would they do that?

Many authorities have commented on the volatility of gas prices. They are only likely to rise, affecting each and every one of us and the economy as a whole.

The Committee on Climate Change, in its report, Household energy bills – impacts of meeting carbon budgets, said "Of the total £455 increase [in typical household energy bills between 2004 and 2010] (i.e. 75%, compared to general price inflation of 16% over the same period), by far the largest contributor was the increase in the wholesale price of gas, which added around £290 to bills.”

And Ofgem agrees. In Why are energy prices rising?, we read: “Higher gas prices have been the main driver of increasing energy bills over the last eight years”.

But, forget this. Forget, even, Qatar. This decision is directly related to what the Exchequer receives from North Sea gas extraction.

A dash for gas means a market for Scottish-English gas as well. High gas prices mean higher revenues for the Treasury.

I have prepared this chart of Government revenues from UK oil and gas production, available from figures published here.

Most of this revenue comes from the Ring Fence Corporation Tax, rated at 30% and separate from other corporation tax, which was introduced under New Labour. This prevents taxable profits from oil and gas extraction in the UK and UKCS being reduced by losses from other activities or by excessive interest payments.

It explains why George Osborne gave away £500 million towards further gas and oil offshore exploration in September. As he said at the time, it's because he will get it back in spades from revenue to come: “It will give companies the incentive to get the most out of older fields, creating jobs and delivering more revenue for taxpayers.“

The revealing thing is what happens if you plot oil and gas revenues against total tax revenues.

Then we find, that in the crunch tax year, 2008-2009, oil and gas revenues were at their highest as a proportion of all tax revenue: 2.56%.

As the recession hit, it fell again. The following two years it was at 1.37% and 1.67%, but it has begun to rise again to 2.04% in the current financial year. There have only been three years in the last 20 when it is gone above 2%.

Here are the full figures:

Year	% of revenue from oil and gas	Total revenue (£bn)
00/01	1.24	359.3
01/02	1.47	369.1
02/03	1.37	375
03/04	1.08	397
04/05	1.21	427.1
05/06	2.05	456.8
06/07	1.84	486
07/08	1.45	516
08/09	2.56	508
09/10	1.37	477.8
10/11	1.67	528.9
11/12	2.04	550.6
12/13	1.7	569
13/14	1.34	599
14/15	1.19	633
15/16	0.92	664
16/17	0.85	704

Treasury predictions for the next four years show this percentage to fall dramatically, but this is only because there are wildly optimistic expectations for tax revenue to increase in this period, to £70.4 billion in 2016/17, compared to £55 billion in this financial year.

Now consider this: renewable energy does not provide such an income. In fact it’s a cost, because of the subsidies.

Conclusion: the Energy Bill compromise is not about what happens after 2020. That couldn’t be further from Osborne’s mind. It's about revenues to the Treasury to help pay off the budget deficit before then.

To put it bluntly, it's about who wins the next election, since it will most likely be determined by how well Osborne has managed the economy.

Britain's carbon capture dream is over after EU cash refused

""That's nearly £500 million of investment in northern England and Scotland that George Osborne just threw away," tweeted Chris Davies, the Liberal Democrat MEP who led discussion of the funding in the European Parliament.

A failure by the British Government to provide details of funding guarantees means that none of the carbon capture and storage (CCS) projects it put forward will receive funding from the European Union.

According to Chris Davies, the Liberal Democrat MEP who led discussion of the funding in the European Parliament, an EU official speaking on condition of anonymity said the reason for the decision was “a lack of funding detail".

A spokesman for the Department of Energy and Climate Change (DECC) said it had not been informed of the decision and refused to comment.

Under the NER300 competition, governments of Member States propose CCS and renewable energy projects for financial support from sale of greenhouse gas emission allowances from the EU European Emissions Trading Scheme by the European Investment Bank.

Chris Davies said the failure was "a devastating blow" to British hopes of becoming a world leader in CCS technology.

"The government has no excuse,” he said. “The EU funding mechanism was only introduced as a result of British pressure and for us not to take advantage of it is simply woeful."

CCS, which captures carbon emitted from the generation of electricity by burning fossil fuels and places it underground, is supposed to play a key part in the British Government's plans to meet its carbon emission reduction targets, especially under the Energy Bill.

Funding details may have been omitted from the application to the EIB pending finalisation of the contents of this Bill, which is due at the end of this month, and which is the subject of continued conflict between the Treasury and DECC.

"That's nearly £500 million of investment in northern England and Scotland that George Osborne just threw away," tweeted Chris Davies on hearing the news.

The Government submitted two projects at the end of October: Progressive Energy consortium's pre-combustion coal gasification project on Teesside and Alstom's 'White Rose' oxyfuel capture system at Drax's proposed new 304 MW coal-fired power station in North Yorkshire.

It is not clear if the same decision applies to the Sound of Islay tidal renewable energy project that was put forward for funding by the Government.

Britain's attempts to become a world leader in this currently unproven technology is now in a complete shambles.

Firstly, a previous competition which it held to fund pilot schemes fell apart over a year ago, as it proved too expensive and had to be relaunched.

There was no shortage of applicants in the second round, but, to much astonishment, the favourite project was not selected by the Government last month. This was the Don Valley Power Project, which had already earned first place among all NER300 CCS proposals.

DECC might have taken this unexpected decision because it wanted to maximise the UK’s overall financial return from NER300. NER300 support for Don Valley would have amounted to €130 million only, while the project replacing it, UK Oxy CCS Demo, would have got funding of €337 million.

Now it looks like DECC won't get any funding at all.

Europe must adopt a 30% emissions reduction target

With any luck we are about to see a shift in action on curbing carbon emissions.

It's not just that the annual United Nations climate change talks, COP-18, begin at the end of this month at Doha in Qatar. Nor is it that with the re-election of Barack Obama there will be a renewed impetus in the American Senate to get a climate change bill passed.

Over on the other side of the world, Australia's Climate Change Minister Greg Combet has said his country will sign up to a second round of the Kyoto Protocol, joining the European Union and just a handful of other major greenhouse gas emitters in recommitting to the world's only climate treaty.

The Kyoto Protocol, negotiated in 1997, required wealthy nations to limit their emission of greenhouse gases by 5.2% on average for the period 2008-2012 from 1990 levels. It is due to expire at the end of this year.

Through the UN climate change negotiations, countries are attempting to thrash out a replacement treaty. If successful, it would be agreed by 2015 and take effect in 2020, and it would include emissions targets for developing nations such as China and India as well as developed countries.

To date, only the European Union and a handful of other small developed nations have signed up to Kyoto 2, which is intended to start in 2013 and continue until such time as when a new agreement comes into effect.

Japan, Russia, Canada and, currently, the US are among the countries refusing to sign up to Kyoto 2. They want a non-binding agreement.

New Zealand has already said it will not follow Australia.

But Kyoto 1 and 2 has been widely criticised. The main candidates for alternative action are a carbon tax activated at national levels, and a network of regional emission trading schemes.

Already, a carbon tax is back on the agenda in the US and the UK.

Republicans are not expected to be enthusiastic; they dislike taxes. The main American proponent of a carbon tax is prominent NASA climate scientist James Hansen. His proposal is to tax carbon at source, whether oil, gas or coal, with a 100% dividend returned to citizens in equal shares, under the principle of the “commons", that every citizen has an equal right to a portion of the sky.

It is estimated that citizens would each get $3,000 to spend as compensation for the tax.

A similar tax has been in place in Canada's British Columbia for four years and is currently under review. The income from the tax is spent on public works.

But how high would a carbon tax need to be to make a significant difference in the consumption of fossil fuels? Consider the amount of tax (60%) already on a litre of petrol. Does it deter us from driving?

Would it make a difference if the price of a barrel of oil was doubled with a $100 tax? That would put up the cost of a litre of petrol to almost £2.

You can imagine the public reaction, even with a cash dividend. The thing is, it’s a blunt instrument. It affects some people more than others.

British Columbia's tax has been introduced gradually and reaches about 5% of the price of fuel. The review will tell us whether or not it has made any difference at all to consumption levels. The jury is yet out.

Hansen distrusts "cap and trade" agreements such as the Kyoto Protocol, and says why in chapter 9 of his book Storms of My Grandchildren.

But that isn't stopping Korea and China from going ahead with their own local schemes emissions trading schemes. On November 15 a presidential decree in Korea will see a mandatory ETS introduced from 2015 for 60% of South Korea’s total greenhouse gas emissions.

The purpose of an ETS is to minimise the cost of meeting a set emissions target. The Korean ETS and most of the Chinese pilot schemes have watched the European Union's ETS become swamped with excess credits and the price of carbon bomb to an ineffectual level.

To prevent this happening in their schemes, they plan to include the use of market stabilising checks and balances to enable them to adjust to external factors such as significant and sustained changes in gross domestic product. These are said to include: a strategic reserve, limitations on banking and borrowing and a ceiling and/or floor price.

Japan has its own scheme, as do Switzerland, New Zealand, California and a number of other American and Canadian states linked together in the Regional Greenhouse Gas Initiative and the Western Climate Initiative.

If such schemes become more common and the European scheme can overcome its current problems, international trading in permits is an attractive way of achieving reductions at the lowest possible cost. This is because it is cheaper to abate or eliminate a ton of carbon dioxide in some countries than in others, and the market automatically gravitates towards the cheapest solution.

In other words, is not such a blunt instrument. On the other hand, a huge amount of money gets wasted and goes into the wrong pockets.

The question is, whether any of these proposals will get us where we want to be fast enough. The answer depends upon the level of political ambition for the level at which an overall target for, or cap on carbon emissions is set, which in turn depends on the amount of public concern.

European environment ministers met at the end of October to discuss the European Union negotiating position at Doha, and what to do about the EU ETS' glut of allowances.

It emerged from their talks that Europe has already beaten its target of 20% emission reductions by 2020 with eight years to spare.

A leaked draft of the Commission's report on the EU ETS says that there will be a surplus of at least two billion allowances next year, rising in the following years. Removing just 1.4 billion of these would be sufficient to let Europe reach a 30% target by 2020.

This would align the scheme with Europe's 2050 climate goal of reducing emissions up to 95% below 1990 levels.

It's this kind of ambition, at least, which is necessary.

The British government supports a 30% target. It should do, it is already ahead of the game. Officials have been arguing for it for some time.

Europe should immediately adopt such a position and, in three weeks time, take it to Doha and challenge the world to follow suit.

Obama must win for the world to have a chance of beating climate change

Here's the logic of this post:

1. The latest science says we're heading for over 6 degrees C warming.
2.  Romney will do nothing but make this worse
3.  Obama must win
4. Then go to Doha and help broker a global pact on limiting emissions.

Following Hurricane Sandy, and more bad news on climate change today , there has never been so much at stake in an American election for the rest of the world.

If this is not a wake-up call, I don't know what is.

Hurricane Sandy was the worst storm to hit the eastern seaboard of the United States in living memory.

In one dramatic moment, that will end up costing American taxpayers billions of dollars, it has succeeded in doing something by powerful demonstration that no other amount of evidence or eloquence has succeeded in doing: it has brought climate change, at the last moment, into the presidential election agenda.

In its wake, the mayor of New York, Michael Bloomberg, has thrown his support behind Barack Obama. The latest issue of Bloomberg BusinessWeek carries on its cover the slogan: “It's climate change, stupid!"

In an editorial, it says: "Climate deniers exploit scientific complexity to avoid any discussion at all. Clarity, however, is not beyond reach. Hurricane Sandy demands it: At least 40 U.S. deaths. Economic losses expected to climb as high as $50 billion. Eight million homes without power. Hundreds of thousands of people evacuated. More than 15,000 flights grounded. Factories, stores, and hospitals shut. Lower Manhattan dark, silent, and underwater."

The latest scientific climate change research, arriving with chilling timing in my e-mail box today, points to disaster for the planet unless something drastic is done. Current rates of decarbonisation mean that global average temperatures are heading to a disastrous 6oC of warming. This would render much of the planet uninhabitable.

The news comes from fresh analysis by financial consultants PwC. Their Low Carbon Economy Index measures the progress of developed and emerging economies towards reducing emissions linked to economic output. Its latest issue says "To limit global warming to 2oC would now mean reducing global carbon intensity by an average of 5.1% a year – a performance never achieved since 1950, when these records began". [For a copy of the report contact Rowena Mearley, Tel: +44 207 213 4247 or e-mail rowena.mearley@uk.pwc.com.]

It adds that any investments in long term assets or infrastructure, particularly in coastal or low-lying regions need to address far more pessimistic scenarios.

This message seems almost pointedly directed at the East Coast of the United States this week.

On October 31, the New York Times published an article which explicitly linked Hurricane Sandy to climate change.

It said “the storm surge along the Atlantic coast was almost certainly intensified by decades of sea-level rise linked to human emissions of greenhouse gases. And [scientists have] emphasized that Hurricane Sandy, whatever its causes, should be seen as a foretaste of trouble to come as the seas rise faster, the risks of climate change accumulate and the political system fails to respond". It quotes in support Thomas R. Knutson, a research meteorologist with the government’s Geophysical Fluid Dynamics Laboratory in Princeton, N.J.

Hurricane Sandy came hot on the heels of the intense summer drought, which also powerfully affected much of the United States.

Americans now know first-hand some of the effects of climate chaos. It's not happening in some remote atoll of the Pacific Ocean, or in the estuarine delta of a poor, developing country. It's happening right in their homes. It is affecting their power supply, the price of their food, their livelihoods. It's costing lives. It's going to put up insurance premiums.

Most Europeans have not been subject to the same ideologically-driven debate over climate change as Americans have in the last decade. They have not been deprived of the true facts of the situation, or misled by compromised politicians.

Facts have a great way of cutting through ideology. During the Cultural Revolution in China, millions died as a result of ideologically-driven policies on agriculture. The authorities responded with denial and cover-up, because the alternative was to admit that their leaders were wrong. But now we know the truth, sadly too late for those peasants who suffered death by starvation.

Americans need to know that their leaders have been wrong, before it is too late.

There is no doubt that Obama's policies on climate change are better than Romney's, who said in his acceptance speech for the GOP nomination: “President Obama promised to slow the rise of the oceans and to heal the planet. My promise ... is to help you and your family”. That phrase should return to haunt him now.

But for Obama to have spoken out loudly on climate change before now would have, paradoxically, worked against his best interests. Instead, he has during his campaign repeatedly shown support for oil, natural gas, shale gas and coal as well as renewables.

That has not been an obstacle for Bill Clinton, who is on the campaign trail himself. On Tuesday he said: “All up and down the East Coast, there are mayors, many of them Republicans, who are being told, ‘You’ve got to move these houses back away from the ocean. You’ve got to lift them up. Climate change is going to raise the water levels on a permanent basis. If you want your town insured, you have to do this.’ In the real world, Barack Obama’s policies work better”.

The president of the World Resources Institute, a former special envoy for climate change at the World Bank, who also happens to be British, has commented on the fact that both presidential candidates have largely avoided mention of climate change by saying: “Political discourse here is massively out of step with the rest of the world, but also with the citizens of this country. Polls show very clearly that two-thirds of Americans think this is a real problem and needs to be addressed.”

We have to hope that Obama wins the poll this week. Romney has opposed Democratic initiatives to regulate emissions from power plants and vehicles. He has promised to reverse Obama’s air quality regulations. He has said he will renegotiate the auto efficiency standard of 54.5 miles per gallon by 2025 that automakers agreed to this year.

Obama, speaking last week in Iowa, has promised to continue support for wind power projects and federal tax breaks for them, which Romney wants to end. “My plan will keep these investments, and we’ll keep reducing the carbon pollution that’s also heating the planet, because climate change isn’t a hoax. The droughts we’ve seen, the floods, the wildfires, those aren’t a joke. They’re a threat to our children’s future. And we can do something about it.”

He is right. Romney is wrong. It's as simple as that.

Obama must not just win a second term. He must then lead the world in the COP 18 climate change negotiations this December in Doha to a proper, legally binding agreement.

America, the world's greatest polluter, has avoided this responsibility for over a decade, and the PwC report reveals the consequence of this.

There has never been so much at stake for the rest of the world in an American election.

The world is heading for a ”carbon cliff” - PwC

PwC's Jonathan Grant says "we are heading for a carbon cliff" unless habits are changed.

PwC is warning today that the world is heading for 6°C warming unless emissions of greenhouse gases go into reverse.

The annual rate of reduction of carbon emissions per unit of GDP needed to limit global warming to 2°C has passed a critical threshold according to new analysis in the PwC Low Carbon Economy Index, published today. This measures developed and emerging economies' progress towards reducing emissions linked to economic output.

It demonstrates that at current rates of emissions growth, at least 6°C degrees of warming could be possible by the end of the century, which would result in large parts of the world becoming uninhabitable.

While last month, Britain topped a European league table for reduction of greenhouse gas emissions, it is by no means clear that this reversal will continue, as Government policy is to maximise oil, gas and coal extraction, and to build a new generation of gas-fired power plants.

The PwC report

The PwC report shows that to limit global warming to 2oC would now mean reducing global carbon intensity by an average of 5.1% a year, a performance never achieved since 1950, when these records began.

PwC's director of sustainability and climate change, Jonathan Grant, says that "we are heading for a carbon cliff" unless habits are changed. "Even doubling our current annual rates of decarbonisation globally every year to 2050, would still lead to 6oC, making governments’ ambitions to limit warming to 2oC appear highly unrealistic.”

Andrew Sentance, PwC's senior economic advisor, says that "Government policies must radically change", and that for business this "represents an opportunity as well as a risk".

“The challenge now is to implement gigatonne scale reductions across the economy, in power generation, energy efficiency, transport and industry, as well as REDD+ in forested nations,” added Grant.

With less than four weeks to the UN Climate Summit in Doha, the analysis illustrates the scale of the challenge facing negotiations. The issue is further complicated by a slow market recovery in developed nations, but sustained growth in E7 economies which could lock economic growth into high carbon assets.

Emerging markets’ previous trends on carbon emissions reductions linked to growth and productivity have stalled, and their total emissions grew by 7.4%.

By contrast, the UK, France and Germany achieved record levels of annual carbon emissions intensity reductions, but were helped on by milder winters.

Examining the role of shale gas, PwC’s report suggests that at current rates of consumption, replacing 10% of global oil and coal consumption with gas could deliver emissions savings of around 3% a year (1gt C02e per annum).

However the report warns that while it may “buy some time”, it reduces the incentive for investment in lower carbon technologies such as nuclear and renewables, and could lock in emerging economies with high energy demand to a dependence on fossil fuels.

America has been exporting the coal it would have burnt had shale gas not displaced its domestic use, so, globally, a shift to shale gas in one country alone makes little difference to overall emissions.

This underlines the importance of reaching a global deal at Doha, PwC says.

UK oil, gas and coal extraction

At home, British policy on reducing carbon emissions no longer appears as consistent as it did until recently.

On 25 October, Energy Minister John Hayes announced 167 new North Sea oil and gas licences, saying that every last economic drop of oil and gas from the North Sea will be extracted.

In answer to a question from Green MP Caroline Lucas last Friday, about whether the effect of this on achievement of the UK's domestic carbon budgets had been calculated, he gave no indication that it had, instead repeating that the Government “aims to secure over time the maximum economic recovery" of the "20 billion barrels of oil equivalent left on the Continental Shelf".

If all this were to be burnt, it would lead to the emission of 872 trillion kgCO2.

Meanwhile, despite a decline in the demand for coal caused by six British power stations having to close by 2016, the coal industry, through CoalPro, their producer’s association, hopes that the industry will be able to maintain a total of approximately 36 working surface mines across the UK, according to the Loose Anti Opencast Network (LAON).

LAON’s latest review of the stage at which 22 current and possible opencast planning applications across the UK have reached, has just come out.

LAON is calling on the Government to align its planning policy with its energy policy. Steve Leary, its coordinator, says: “It is the Government's intention to phase out the use of coal for power generation purposes, leading to a 75% decline in the use of coal for such a purpose over the next 10 years, whilst at the same time, through provisions in the Growth and Infrastructure Bill, it is possibly making it easier to dig the coal out".

He says this coal would probably be exported if not burnt at home.

This morning, activists from the No Dash for Gas campaign who have been protesting at the Government's policy to build a new generation of 20 gas-fired power stations, are ending a seven day occupation of the 300 foot high chimneys of EDF's West Burton 1,300MW Combined Cycle Gas Turbine (CCGT) plant, currently under construction in Nottinghamshire.

Energy and Climate Change Secretary, Ed Davey, has guaranteed that if built, these stations will be exempted from emissions regulations and can continue emitting CO2 unabated until 2045.

Call to decarbonise
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In a timely move, the Carbon Capture and Storage Association, the Nuclear Industry Association and RenewableUK have today issued a joint call to Energy Secretary Ed Davey to largely decarbonise the power sector by 2030.

The three associations, representing over 1,000 corporate members, make the request  in a letter  copied to the Chancellor, Prime Minister, Business Secretary and Deputy Prime Minister and Minister of State at the Cabinet Office.

The letter states that including a reference to the objective to largely decarbonise the power sector by 2030 in the Bill would reassure potential investors by lowering political risk and bring the cost of capital down for lower carbon generation.

The organisations stress, however, that any target set in legislation should serve a specific and necessary purpose and not contribute to so-called "target fatigue" in the energy sector; and it