In this newsletter:
1) ‘Red Wall’ Tories tell Boris Johnson to act on energy crisis or ‘end up out of power’
The Independent, 12 January 2022
2) Energy bosses demand ministers SCRAP green levies
Daily Mail, 12 January 2022
4) Benny Peiser: 'We have to make energy affordable again'
Talk Radio, 12 January 2022
5) Johnson’s political weakness leaves climate agenda at risk, say campaigners
The Guardian, 11 January 2022
6) Britons give up on going green after just two weeks
The Sun, 12 January 2022
7) Madeline Grant: We're all paying the price for rampant eco hypocrisy
The Daily Telegraph, 12 January 2022
8) Reality check: US oil production set to eclipse previous record despite climate push
Financial Times, 11 January 2022
The Independent, 12 January 2022
2) Energy bosses demand ministers SCRAP green levies
Daily Mail, 12 January 2022
3) Rishi Sunak is planning to ease energy bills crisis
Politics Home, 11 January 2022
Politics Home, 11 January 2022
4) Benny Peiser: 'We have to make energy affordable again'
Talk Radio, 12 January 2022
5) Johnson’s political weakness leaves climate agenda at risk, say campaigners
The Guardian, 11 January 2022
6) Britons give up on going green after just two weeks
The Sun, 12 January 2022
7) Madeline Grant: We're all paying the price for rampant eco hypocrisy
The Daily Telegraph, 12 January 2022
8) Reality check: US oil production set to eclipse previous record despite climate push
Financial Times, 11 January 2022
9) US hints at gas deal as Putin sends jets to Ukraine border
The Times, 11 January 2022
Full details:
1) ‘Red Wall’ Tories tell Boris Johnson to act on energy crisis or ‘end up out of power’
The Independent, 12 January 2022
Tory MPs in ‘Red Wall’ seats are telling a beleaguered Boris Johnson to act on the cost-of-living crisis or “end up out of power”, in a new challenge to his authority.
The Northern Research Group of 70 MPs is warning that voters who put the prime minister in No 10 that they will “lose trust in us” unless taxes and fuel bills are slashed.
Jake Berry, the group’s founder – and formerly a close ally of Mr Johnson – pointed to the way Labour lost seats across the North and Midlands at the 2019 general election, because it didn’t “understand” voters.
And he warned: “I worry that, unless there is urgent action on the cost of living, millions of voters who switched to the Tories in 2019 are going to lose trust in us after just one term.
“It is sadly undeniable that we are all going to struggle to make ends meet over the next few months,” Mr Berry said, adding: “We can all see this crisis coming, so now is the time to act.”
The group’s three-point plan would spare poorer households from the hike in National Insurance contributions in April, by lifting the threshold for paying the tax to £12,570.
The MPs are also demanding a two-year freeze to council tax – to prevent bills also soaring in April – arguing local authorities can dip into their reserves instead.
Third, ‘green levies’ would be removed from domestic fuel bills for one year, to ease the pain of a predicted £600 leap in the energy price cap, also from April.
“This triple whammy is creating a cost of living crisis and it is going to hurt,” said Mr Berry, writing in The Sun.
“Our simple, three-point plan would put hundreds of pounds back into your pocket and demonstrate it is the Conservative Party that is the true party of the North and in touch and on the side of our hard-pressed working families.”
2) Energy bosses demand ministers SCRAP green levies
Daily Mail, 12 January 2022
Britain's spiralling gas crisis could last another two years, the boss of British Gas has warned, as the under-fire chief of Ovo said the UK's poorest people are paying the most, piling pressure on the Chancellor to step in and axe green taxes costing an extra £375-a-year.
The struggling market suggests high prices will continue for at least the next 18 months, chief executive of Centrica Chris O'Shea said.
He said demand was partly being driven by a move away from coal and oil, with gas acting as a transition fuel. But he claimed ministers could save customers £375 off the average bill by slashing supplier fees, VAT and green levies.
Energy bills for millions of households are expected to jump by more than 50 pet cent in April to £2,000 a year, when Britain's energy price cap is adjusted.
Rishi Sunak is under growing pressure among Tory backbenchers to tackle the crisis after the PM said he is 'constantly' meeting him to discuss the leap.
Ovo Energy boss Stephen Fitzpatrick also called for the Government to cut green levies and social costs on energy bills, and instead raise the money through normal taxes.
'It's important to note that consumers will need to pay the real price of energy,' he said. 'But what we have in our energy bills today (is) not only VAT, but also a whole bunch of environmental and social costs that the poorest in our society are paying the highest proportion towards.
'We think these should be paid through general taxation. There's a wide consensus across the industry that the energy charges that go on everybody's bills are really regressive. They lead to the poorest paying the most.
'If we paid for them through general taxation, we could ensure the wealthiest in society shoulder the biggest burden. It's something that the Government could do today. We think there's an announcement coming, but so far - five months into this crisis - we haven't seen anything.'
But Centrica, which owns British Gas, CEO Mr OShea warned Britons should expect the current crisis to remain for the next 18 months to two years. [...]
Boris Johnson is reportedly backing a plan being developed by Business Secretary Kwasi Kwarteng for state loans to firms threatened with closure over the winter.
The move follows an extraordinary Whitehall turf war between Mr Kwarteng and Mr Sunak, which broke out over the weekend, with the Treasury denying there are plans.
Mr Sunak is due to hold talks with Tory MPs in the coming days, according to the BBC, as he tries to dampen Conservative anger on the issue.
Some Tory backbenchers are adamant the Chancellor and the Prime Minister must act now to address soaring energy bills and spiking inflation.
Full story
4) Benny Peiser: 'We have to make energy affordable again'
Talk Radio, 12 January 2022
"We've published this guide of the options the government has to reduce energy bills... and the best options of actually turning this crisis into a radical reform of failed energy policies that have been failing us for the last two or three decades."
The Independent, 12 January 2022
Tory MPs in ‘Red Wall’ seats are telling a beleaguered Boris Johnson to act on the cost-of-living crisis or “end up out of power”, in a new challenge to his authority.
The Northern Research Group of 70 MPs is warning that voters who put the prime minister in No 10 that they will “lose trust in us” unless taxes and fuel bills are slashed.
Jake Berry, the group’s founder – and formerly a close ally of Mr Johnson – pointed to the way Labour lost seats across the North and Midlands at the 2019 general election, because it didn’t “understand” voters.
And he warned: “I worry that, unless there is urgent action on the cost of living, millions of voters who switched to the Tories in 2019 are going to lose trust in us after just one term.
“It is sadly undeniable that we are all going to struggle to make ends meet over the next few months,” Mr Berry said, adding: “We can all see this crisis coming, so now is the time to act.”
The group’s three-point plan would spare poorer households from the hike in National Insurance contributions in April, by lifting the threshold for paying the tax to £12,570.
The MPs are also demanding a two-year freeze to council tax – to prevent bills also soaring in April – arguing local authorities can dip into their reserves instead.
Third, ‘green levies’ would be removed from domestic fuel bills for one year, to ease the pain of a predicted £600 leap in the energy price cap, also from April.
“This triple whammy is creating a cost of living crisis and it is going to hurt,” said Mr Berry, writing in The Sun.
“Our simple, three-point plan would put hundreds of pounds back into your pocket and demonstrate it is the Conservative Party that is the true party of the North and in touch and on the side of our hard-pressed working families.”
2) Energy bosses demand ministers SCRAP green levies
Daily Mail, 12 January 2022
Britain's spiralling gas crisis could last another two years, the boss of British Gas has warned, as the under-fire chief of Ovo said the UK's poorest people are paying the most, piling pressure on the Chancellor to step in and axe green taxes costing an extra £375-a-year.
The struggling market suggests high prices will continue for at least the next 18 months, chief executive of Centrica Chris O'Shea said.
He said demand was partly being driven by a move away from coal and oil, with gas acting as a transition fuel. But he claimed ministers could save customers £375 off the average bill by slashing supplier fees, VAT and green levies.
Energy bills for millions of households are expected to jump by more than 50 pet cent in April to £2,000 a year, when Britain's energy price cap is adjusted.
Rishi Sunak is under growing pressure among Tory backbenchers to tackle the crisis after the PM said he is 'constantly' meeting him to discuss the leap.
Ovo Energy boss Stephen Fitzpatrick also called for the Government to cut green levies and social costs on energy bills, and instead raise the money through normal taxes.
'It's important to note that consumers will need to pay the real price of energy,' he said. 'But what we have in our energy bills today (is) not only VAT, but also a whole bunch of environmental and social costs that the poorest in our society are paying the highest proportion towards.
'We think these should be paid through general taxation. There's a wide consensus across the industry that the energy charges that go on everybody's bills are really regressive. They lead to the poorest paying the most.
'If we paid for them through general taxation, we could ensure the wealthiest in society shoulder the biggest burden. It's something that the Government could do today. We think there's an announcement coming, but so far - five months into this crisis - we haven't seen anything.'
But Centrica, which owns British Gas, CEO Mr OShea warned Britons should expect the current crisis to remain for the next 18 months to two years. [...]
Boris Johnson is reportedly backing a plan being developed by Business Secretary Kwasi Kwarteng for state loans to firms threatened with closure over the winter.
The move follows an extraordinary Whitehall turf war between Mr Kwarteng and Mr Sunak, which broke out over the weekend, with the Treasury denying there are plans.
Mr Sunak is due to hold talks with Tory MPs in the coming days, according to the BBC, as he tries to dampen Conservative anger on the issue.
Some Tory backbenchers are adamant the Chancellor and the Prime Minister must act now to address soaring energy bills and spiking inflation.
Full story
3) Rishi Sunak is planning to ease energy bills crisis
Politics Home, 11 January 2022
The Chancellor has hinted he is planning on intervening on energy bills ahead of the price cap announcement in February as he tries to deflect criticism over the looming cost of living crisis.
Politics Home, 11 January 2022
The Chancellor has hinted he is planning on intervening on energy bills ahead of the price cap announcement in February as he tries to deflect criticism over the looming cost of living crisis.
There is growing anger within the Conservatives that Downing Street is “sleepwalking into this crisis" at a time when the party is already taking a hammering in the polls over the lockdown parties scandal.
The Treasury has invited backbenchers to a series of meetings this week to discuss what support is being offered to households.
Rishi Sunak is said to have told Tory MPs at a meeting on Monday that the government is looking to try and act before the regulator Ofgem confirms how much gas and electricity tariffs will increase and help soften the blow.
PoliticsHome understands Sunak suggested he hopes to make an announcement before the Commons breaks up for half-term recess on February 10, which would coincide with the Ofgem announcement.
Around 60 MPs attended Monday's event, at which the Chancellor appeared virtually. Sunak is reported to understand the need to expand existing schemes to alleviate the impact of rising living costs in April, when people will start to pay a higher rate of National Insurance, as well as the energy price cap rise coming into force.
He asked MPs to give him time to come up with a plan that was targeted at those who are most in need of it, after calls last week to cut VAT on fuel bills and remove environmental levies on energy were dismissed by Boris Johnson as “a bit of a blunt instrument”.
The new cap on how much gas and electricity providers can charge customers won't come into force until April, but the amount by which it will go up by – which utility firm bosses are warning could easily go from £1,277 to above £2,000 – will be confirmed on 7 February.
Options believed to be under discussion to mitigate the increase include an extension to the winter fuel payments scheme, as well a further extension of the Warm Homes Discount, which provides £140 a year to around 2.2 million people.
One Tory MP criticised the potential delay such a move would take in further means-testing, and said they were pressing the government on announcing a universal benefit to all consumers.
Although the cut to VAT appears to have been ruled out, despite Johnson being in favour of such a move previously, the plan to reduce the green levies – that can form as much as a quarter of consumer electricity bills – is believed to still be on the table.
Temporarily removing them was proposed by the Conservative Environment Network, which includes 116 MPs, and was endorsed by the Energy Efficiency Infrastructure Group of businesses and charities.
It was also backed by a group of 20 Conservative politicians in a letter to the Prime Minister, signed by Craig Mackinlay, chairman of the Net Zero Scrutiny Group of Tory MPs, former work and pensions secretary Esther McVey, and ex-ministers Steve Baker and Robert Halfon.
Full story
The Treasury has invited backbenchers to a series of meetings this week to discuss what support is being offered to households.
Rishi Sunak is said to have told Tory MPs at a meeting on Monday that the government is looking to try and act before the regulator Ofgem confirms how much gas and electricity tariffs will increase and help soften the blow.
PoliticsHome understands Sunak suggested he hopes to make an announcement before the Commons breaks up for half-term recess on February 10, which would coincide with the Ofgem announcement.
Around 60 MPs attended Monday's event, at which the Chancellor appeared virtually. Sunak is reported to understand the need to expand existing schemes to alleviate the impact of rising living costs in April, when people will start to pay a higher rate of National Insurance, as well as the energy price cap rise coming into force.
He asked MPs to give him time to come up with a plan that was targeted at those who are most in need of it, after calls last week to cut VAT on fuel bills and remove environmental levies on energy were dismissed by Boris Johnson as “a bit of a blunt instrument”.
The new cap on how much gas and electricity providers can charge customers won't come into force until April, but the amount by which it will go up by – which utility firm bosses are warning could easily go from £1,277 to above £2,000 – will be confirmed on 7 February.
Options believed to be under discussion to mitigate the increase include an extension to the winter fuel payments scheme, as well a further extension of the Warm Homes Discount, which provides £140 a year to around 2.2 million people.
One Tory MP criticised the potential delay such a move would take in further means-testing, and said they were pressing the government on announcing a universal benefit to all consumers.
Although the cut to VAT appears to have been ruled out, despite Johnson being in favour of such a move previously, the plan to reduce the green levies – that can form as much as a quarter of consumer electricity bills – is believed to still be on the table.
Temporarily removing them was proposed by the Conservative Environment Network, which includes 116 MPs, and was endorsed by the Energy Efficiency Infrastructure Group of businesses and charities.
It was also backed by a group of 20 Conservative politicians in a letter to the Prime Minister, signed by Craig Mackinlay, chairman of the Net Zero Scrutiny Group of Tory MPs, former work and pensions secretary Esther McVey, and ex-ministers Steve Baker and Robert Halfon.
Full story
4) Benny Peiser: 'We have to make energy affordable again'
Talk Radio, 12 January 2022
"We've published this guide of the options the government has to reduce energy bills... and the best options of actually turning this crisis into a radical reform of failed energy policies that have been failing us for the last two or three decades."
Click here to watch
5) Johnson’s political weakness leaves climate agenda at risk, say campaigners
The Guardian, 11 January 2022
The government’s climate agenda is under threat as Boris Johnson’s popularity slumps, according to green campaigners who work closely with the Conservative party.
5) Johnson’s political weakness leaves climate agenda at risk, say campaigners
The Guardian, 11 January 2022
The government’s climate agenda is under threat as Boris Johnson’s popularity slumps, according to green campaigners who work closely with the Conservative party.
As the prime minister faces further lockdown party allegations, and angry Conservative MPs seek answers over energy price rises and the cost of living crisis, analysts fear the government’s commitment to net zero is facing its most severe test yet.
Tom Burke, a co-founder of the E3G green thinktank and a veteran government adviser, said: “Johnson has been the standard bearer for net zero, and lots of people were happy about that. There is now a sustained assault from the right on net zero. They see the prime minister’s political weakness, and they see net zero as a flank on which to attack him.”
Rishi Sunak, the chancellor, is meeting backbench Tory MPs this week to calm fears that the squeeze on incomes caused by rising inflation and soaring gas prices will turn away voters, particularly in “red wall” seats in the north of England. He is under pressure from vocal quarters to abandon green measures such as carbon levies, which play a small role in energy bills.
Although experts have criticised the government’s net zero plans as falling woefully short on ambition and funding, Johnson is still seen as more engaged with the climate crisis than any of his Tory rivals and has made net zero a personal crusade, with a 10-point plan to “build back greener”, published after the first Covid lockdown.
He is influenced by close advisers and allies including his wife, Carrie Johnson, who works for a conservation charity, and his father, Stanley, a prominent “green Tory”, as well as friends such as Zac Goldsmith, the former owner of the Ecologist magazine, whom Johnson appointed as a minister in the Lords.
Chris Venables, the head of politics at the Green Alliance thinktank, said: “There is definite jeopardy in Boris Johnson’s weakness, as he has been the champion. But the forces of good are now rallying behind the green agenda. It does help that the facts are on our side.”
Johnson’s main rivals in the cabinet – Sunak and the foreign secretary, Liz Truss, who are both seen as leadership contenders – have been particularly notable in distancing themselves from net zero efforts.
Megan Randles, a political campaigner at Greenpeace, said: “This year there have been more missed opportunities than bold measures by Sunak and Truss. Sunak didn’t mention the climate once in his party conference speech; his spending review failed to kickstart a green recovery, and he is reported to have curbed Johnson’s climate ambitions and hindered Cop26. Truss actively undermined climate action in the Australia trade deal.”
On the Tory backbenches, a small but vocal group – the “net zero scrutiny group” – of about 20 MPs has been courting media attention by blaming gas prices on green measures that they say should be scrapped. Analysts and experts have pointed out that the UK’s overreliance on fossil fuels carries most of the blame, and that insulating homes and investing in green energy at home would alleviate the problem.
Full story
6) Britons give up on going green after just two weeks
The Sun, 12 January 2022
It takes adults an average of 13 days to give up sustainable habits - with ‘meat-free days’ being the first to go, research has discovered.
Tom Burke, a co-founder of the E3G green thinktank and a veteran government adviser, said: “Johnson has been the standard bearer for net zero, and lots of people were happy about that. There is now a sustained assault from the right on net zero. They see the prime minister’s political weakness, and they see net zero as a flank on which to attack him.”
Rishi Sunak, the chancellor, is meeting backbench Tory MPs this week to calm fears that the squeeze on incomes caused by rising inflation and soaring gas prices will turn away voters, particularly in “red wall” seats in the north of England. He is under pressure from vocal quarters to abandon green measures such as carbon levies, which play a small role in energy bills.
Although experts have criticised the government’s net zero plans as falling woefully short on ambition and funding, Johnson is still seen as more engaged with the climate crisis than any of his Tory rivals and has made net zero a personal crusade, with a 10-point plan to “build back greener”, published after the first Covid lockdown.
He is influenced by close advisers and allies including his wife, Carrie Johnson, who works for a conservation charity, and his father, Stanley, a prominent “green Tory”, as well as friends such as Zac Goldsmith, the former owner of the Ecologist magazine, whom Johnson appointed as a minister in the Lords.
Chris Venables, the head of politics at the Green Alliance thinktank, said: “There is definite jeopardy in Boris Johnson’s weakness, as he has been the champion. But the forces of good are now rallying behind the green agenda. It does help that the facts are on our side.”
Johnson’s main rivals in the cabinet – Sunak and the foreign secretary, Liz Truss, who are both seen as leadership contenders – have been particularly notable in distancing themselves from net zero efforts.
Megan Randles, a political campaigner at Greenpeace, said: “This year there have been more missed opportunities than bold measures by Sunak and Truss. Sunak didn’t mention the climate once in his party conference speech; his spending review failed to kickstart a green recovery, and he is reported to have curbed Johnson’s climate ambitions and hindered Cop26. Truss actively undermined climate action in the Australia trade deal.”
On the Tory backbenches, a small but vocal group – the “net zero scrutiny group” – of about 20 MPs has been courting media attention by blaming gas prices on green measures that they say should be scrapped. Analysts and experts have pointed out that the UK’s overreliance on fossil fuels carries most of the blame, and that insulating homes and investing in green energy at home would alleviate the problem.
Full story
6) Britons give up on going green after just two weeks
The Sun, 12 January 2022
It takes adults an average of 13 days to give up sustainable habits - with ‘meat-free days’ being the first to go, research has discovered.
A study of 2,000 adults found carnivorous Brits usually only manage to ditch their favourite foods for a plant-based diet for 12 days in total.
Using eco-friendly products is a behaviour people can keep longest, but even that starts to wane after 15 days.
While measures such as using the food waste bin, using eco settings in the home, and only boiling the water required, last for just two weeks.
It emerged 55 per cent of people have not seen positive changes following their actions, while more than half feel disheartened because it seems no matter what they do, the climate emergency isn’t improving.
The study was commissioned by Utilita, as part of its Planet Pledge campaign which invites people to take part in a 66 day pledge to do something good for the environment - the time it takes to form a new habit effectively.
Sustainability Lead, Archie Lasseter, said: "While it can feel like we're fighting a losing battle, it's so important to remember that even the smallest changes can have a massive impact, and will.
“There are 67 million people living in the UK, and if each person made a small change, the impact would be huge.
“It is sad to see how quickly us Brits give up on our attempts at being green, lasting a little under two weeks for most of us – but it’s reassuring to see that some people are winning, and are able to carry them on indefinitely.”
The study found 24 per cent of adults have been inspired to live a greener lifestyle and take on new habits because someone they knew was doing so.
However, those who decide to get into composting will pack in the new habit after just 14-and-a-half days on average, but will last a little longer before going back to buying non-sustainable fashion.
Other green goals that fall by the wayside early include walking short distances rather than driving and cutting down on using the tumble dryer.
While 22 per cent of adults don't believe they will reduce the amount they fly despite the climate crisis.
More than a fifth (22 per cent) of respondents have been told a green habit they were trying to maintain was ‘pointless’.
Full story
7) Madeline Grant: We're all paying the price for rampant eco hypocrisy
The Daily Telegraph, 12 January 2022
Labour and Tories rail at energy costs, but dare not question the green policies that have increased them
Using eco-friendly products is a behaviour people can keep longest, but even that starts to wane after 15 days.
While measures such as using the food waste bin, using eco settings in the home, and only boiling the water required, last for just two weeks.
It emerged 55 per cent of people have not seen positive changes following their actions, while more than half feel disheartened because it seems no matter what they do, the climate emergency isn’t improving.
The study was commissioned by Utilita, as part of its Planet Pledge campaign which invites people to take part in a 66 day pledge to do something good for the environment - the time it takes to form a new habit effectively.
Sustainability Lead, Archie Lasseter, said: "While it can feel like we're fighting a losing battle, it's so important to remember that even the smallest changes can have a massive impact, and will.
“There are 67 million people living in the UK, and if each person made a small change, the impact would be huge.
“It is sad to see how quickly us Brits give up on our attempts at being green, lasting a little under two weeks for most of us – but it’s reassuring to see that some people are winning, and are able to carry them on indefinitely.”
The study found 24 per cent of adults have been inspired to live a greener lifestyle and take on new habits because someone they knew was doing so.
However, those who decide to get into composting will pack in the new habit after just 14-and-a-half days on average, but will last a little longer before going back to buying non-sustainable fashion.
Other green goals that fall by the wayside early include walking short distances rather than driving and cutting down on using the tumble dryer.
While 22 per cent of adults don't believe they will reduce the amount they fly despite the climate crisis.
More than a fifth (22 per cent) of respondents have been told a green habit they were trying to maintain was ‘pointless’.
Full story
7) Madeline Grant: We're all paying the price for rampant eco hypocrisy
The Daily Telegraph, 12 January 2022
Labour and Tories rail at energy costs, but dare not question the green policies that have increased them
We British specialise in holding two contradictory positions at once, especially when it comes to politics. Avowed NHS-lovers will grumble incessantly about its lengthy waiting-lists. We dislike part-time politicians – but somehow loathe career politicians even more.
The sagas of Pen Farthing and Geronimo the Alpaca strongly suggest that we’ve pioneered a way of being sentimental to the point of soppiness about animals, while showing a noticeable disregard for humans in a similar plight. No one does cognitive dissonance quite like us – an intellectually cost-free way of having our cake and eating it.
Yesterday provided another salient example in the form of the green agenda and the cost-of-living crisis – two utterly contradictory conversations which are happening at once, each without reference to the other. While Labour led a parliamentary debate about cutting VAT on fuel bills in the Commons, Shadow Chancellor Rachel Reeves berated the Government for failing to prioritise UK energy security and called on ministers to do more for struggling consumers. Many of her points were correct; and for the Government to face any kind of pressure to reduce taxes must surely be a good thing. Yet there was also a substantial elephant in the Commons.
The consumer benefits of reducing VAT by 5 per cent would be paltry compared to the potential gains of reducing the various green levies which make up a significant proportion of electricity bills, and depending on the level Ofgem sets the price cap when it is tweaked in April, energy firms might well absorb some of the future VAT cuts. Yet Labour daren’t target the cost of green levies, because this would undermine another key aspect of their agenda; out-flanking the Tories on the environment, so they opt for the lower-hanging fruit of VAT while congratulating themselves for being such valiant defenders of the poor.
It’s not just Labour either. Despite the surging costs facing consumers, the PM held firm on green levies when pushed on the subject last week, citing their importance in sustaining Britain’s renewables industry.
On the same day as Labour’s debate, Ovo Energy was forced to apologise for issuing customers of one of its subsidiaries with deliciously simplistic advice for keeping warm in their chilly homes, worthy of Pippa Middleton’s infamous book on throwing parties. Try “a cuddle with your pets and loved ones to help stay cosy”, they said, a “hula-hoop contest” or cheeky bowl of porridge rather than switching on those pesky radiators.
All this attracted rightful ridicule, but the hula-hoop contest arguably seems an unavoidable outcome of the rapid transformation in our energy use which every major party has signed up to. Hiking prices to discourage use is an explicit aim of many green policies; such as air passenger duty. For all but the most insulated homes, mandatory heat pumps will almost certainly mean cooler temperatures.
Expressions of outrage from Labour and Tory environmentalists about bills are a bad case of “too little too late” when they’ve ignored or opposed viable forms of energy for some time – in their opposition to fracking, and, in the case of the Government, its long-term ambivalence towards nuclear power. Labour has only very recently warmed towards the idea, following a string of 2019 losses in seats like Workington and Barrow-and-Furness with nuclear power stations (indeed, with the Hartlepool by-election, all “nuclear” seats are now represented by a Tory MP).
Certainly, our current energy crisis owes much to worldwide pressures – low renewable generation over the summer, the surging global demand for gas, a deliberate attempt by Russia to exert leverage (potentially to weaken Europe’s response if they invade Ukraine). But we are not just suffering at the whim of international markets. Consider what our Government has done with what is in its remit. We are now paying as much as 10 times more for natural gas than US consumers, partly due to our failure to tap into shale reserves. And still, even in the midst of a consumer crunch, the Government seems reluctant to sanction even a temporary rethink of green levies. When questioned about mounting energy costs, ministers will usually respond by referencing some government subsidy or scheme, never any of the underlying causes.
This reflects a depressing shift in Tory thinking; from supply-side to demand-side. But the entire national conversation operates in a similar vacuum, and such self-contradictory thinking is directly reflected in our policies. Instead of opting for simpler ways of targeting environmental footprints, such as a border-adjusted carbon levy – politicians invariably favour some complex round of taxes and exemptions, inflating bills via green levies; then subsidising the bills of those on low incomes.
As such, energy policy ends up operating a bit like the water cycle, a self-perpetuating round of tariffs, caps and subsidies. At the centre of these ever-decreasing circles of ever-increasing prices is, of course, the consumer. Perhaps cognitive dissonance does have a cost after all.
8) Reality check: US oil production set to eclipse previous record despite climate push
Financial Times, 11 January 2022
US oil production is on course to break pre-pandemic records next year, a government agency has forecast, complicating the Biden administration’s ambitions to shift the country away from fossil fuels.
Output is likely to rise to a fresh annual high of 12.4m barrels a day in 2023, the Energy Information Administration said on Tuesday, eclipsing the previous record volume of 12.3m b/d set in 2019. US natural gas production will also set new records over the next two years, the independent statistics agency said.
It marks a stark reversal for an oil and gas industry that was sent into freefall by the pandemic-driven economic downturn, and defies widespread predictions that the country’s oil industry would not recapture peak production levels.
The forecast comes as higher energy prices spark new investment in developing oil and gasfields. The EIA expected Brent crude oil prices to average $75 a barrel this year and $68 a barrel next year — lower than spot prices, which suggests production could climb even in a weaker commodity market.
While the Biden administration has promised a long-term shift away from fossil fuels, it has recently leaned on the domestic oil sector to lift output to help cool a rally in motor fuel, where prices last year reached their highest levels since 2014.
The expected supply rebound comes even as many of the largest US oil and gas producers have shifted their focus over the past two years away from maximising output growth and towards rewarding shareholders.
Many of the nation’s top producers, including ConocoPhillips, EOG Resources and Pioneer Natural Resources, are setting up new dividend schemes and using cash to buy back their own shares, rather than drill more new wells.
Analysts say the next wave of production growth will instead be led by smaller producers, often family-owned or backed by private equity, which are not under the same shareholder pressure to trim growth.
The EIA also predicts carbon emissions from the energy sector will continue to rise through 2023 after strongly rebounding in 2021 from a sharp fall during 2020.
Full story
The sagas of Pen Farthing and Geronimo the Alpaca strongly suggest that we’ve pioneered a way of being sentimental to the point of soppiness about animals, while showing a noticeable disregard for humans in a similar plight. No one does cognitive dissonance quite like us – an intellectually cost-free way of having our cake and eating it.
Yesterday provided another salient example in the form of the green agenda and the cost-of-living crisis – two utterly contradictory conversations which are happening at once, each without reference to the other. While Labour led a parliamentary debate about cutting VAT on fuel bills in the Commons, Shadow Chancellor Rachel Reeves berated the Government for failing to prioritise UK energy security and called on ministers to do more for struggling consumers. Many of her points were correct; and for the Government to face any kind of pressure to reduce taxes must surely be a good thing. Yet there was also a substantial elephant in the Commons.
The consumer benefits of reducing VAT by 5 per cent would be paltry compared to the potential gains of reducing the various green levies which make up a significant proportion of electricity bills, and depending on the level Ofgem sets the price cap when it is tweaked in April, energy firms might well absorb some of the future VAT cuts. Yet Labour daren’t target the cost of green levies, because this would undermine another key aspect of their agenda; out-flanking the Tories on the environment, so they opt for the lower-hanging fruit of VAT while congratulating themselves for being such valiant defenders of the poor.
It’s not just Labour either. Despite the surging costs facing consumers, the PM held firm on green levies when pushed on the subject last week, citing their importance in sustaining Britain’s renewables industry.
On the same day as Labour’s debate, Ovo Energy was forced to apologise for issuing customers of one of its subsidiaries with deliciously simplistic advice for keeping warm in their chilly homes, worthy of Pippa Middleton’s infamous book on throwing parties. Try “a cuddle with your pets and loved ones to help stay cosy”, they said, a “hula-hoop contest” or cheeky bowl of porridge rather than switching on those pesky radiators.
All this attracted rightful ridicule, but the hula-hoop contest arguably seems an unavoidable outcome of the rapid transformation in our energy use which every major party has signed up to. Hiking prices to discourage use is an explicit aim of many green policies; such as air passenger duty. For all but the most insulated homes, mandatory heat pumps will almost certainly mean cooler temperatures.
Expressions of outrage from Labour and Tory environmentalists about bills are a bad case of “too little too late” when they’ve ignored or opposed viable forms of energy for some time – in their opposition to fracking, and, in the case of the Government, its long-term ambivalence towards nuclear power. Labour has only very recently warmed towards the idea, following a string of 2019 losses in seats like Workington and Barrow-and-Furness with nuclear power stations (indeed, with the Hartlepool by-election, all “nuclear” seats are now represented by a Tory MP).
Certainly, our current energy crisis owes much to worldwide pressures – low renewable generation over the summer, the surging global demand for gas, a deliberate attempt by Russia to exert leverage (potentially to weaken Europe’s response if they invade Ukraine). But we are not just suffering at the whim of international markets. Consider what our Government has done with what is in its remit. We are now paying as much as 10 times more for natural gas than US consumers, partly due to our failure to tap into shale reserves. And still, even in the midst of a consumer crunch, the Government seems reluctant to sanction even a temporary rethink of green levies. When questioned about mounting energy costs, ministers will usually respond by referencing some government subsidy or scheme, never any of the underlying causes.
This reflects a depressing shift in Tory thinking; from supply-side to demand-side. But the entire national conversation operates in a similar vacuum, and such self-contradictory thinking is directly reflected in our policies. Instead of opting for simpler ways of targeting environmental footprints, such as a border-adjusted carbon levy – politicians invariably favour some complex round of taxes and exemptions, inflating bills via green levies; then subsidising the bills of those on low incomes.
As such, energy policy ends up operating a bit like the water cycle, a self-perpetuating round of tariffs, caps and subsidies. At the centre of these ever-decreasing circles of ever-increasing prices is, of course, the consumer. Perhaps cognitive dissonance does have a cost after all.
8) Reality check: US oil production set to eclipse previous record despite climate push
Financial Times, 11 January 2022
US oil production is on course to break pre-pandemic records next year, a government agency has forecast, complicating the Biden administration’s ambitions to shift the country away from fossil fuels.
Output is likely to rise to a fresh annual high of 12.4m barrels a day in 2023, the Energy Information Administration said on Tuesday, eclipsing the previous record volume of 12.3m b/d set in 2019. US natural gas production will also set new records over the next two years, the independent statistics agency said.
It marks a stark reversal for an oil and gas industry that was sent into freefall by the pandemic-driven economic downturn, and defies widespread predictions that the country’s oil industry would not recapture peak production levels.
The forecast comes as higher energy prices spark new investment in developing oil and gasfields. The EIA expected Brent crude oil prices to average $75 a barrel this year and $68 a barrel next year — lower than spot prices, which suggests production could climb even in a weaker commodity market.
While the Biden administration has promised a long-term shift away from fossil fuels, it has recently leaned on the domestic oil sector to lift output to help cool a rally in motor fuel, where prices last year reached their highest levels since 2014.
The expected supply rebound comes even as many of the largest US oil and gas producers have shifted their focus over the past two years away from maximising output growth and towards rewarding shareholders.
Many of the nation’s top producers, including ConocoPhillips, EOG Resources and Pioneer Natural Resources, are setting up new dividend schemes and using cash to buy back their own shares, rather than drill more new wells.
Analysts say the next wave of production growth will instead be led by smaller producers, often family-owned or backed by private equity, which are not under the same shareholder pressure to trim growth.
The EIA also predicts carbon emissions from the energy sector will continue to rise through 2023 after strongly rebounding in 2021 from a sharp fall during 2020.
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9) US hints at gas deal as Putin sends jets to Ukraine border
The Times, 11 January 2022
Russia is moving attack helicopters and fighter jets towards the Ukrainian border even as the White House scrambles to defuse a stand-off with the Kremlin by blocking calls for sanctions on businesses linked to Nord Stream 2.
The new pipeline, intended to funnel Russian gas to Germany, has become a bone of contention for those who believe President Putin’s aggression should be countered with financial penalties.
Talks held this week between the US and Russia on the Ukraine issue remain deadlocked, but in Washington senior Democrats are trying to defeat a motion by Republicans in Congress to hit Moscow with sanctions. The Biden administration has insisted that such action would only serve to inflame tensions further.
US officials said Russian helicopters and ground-attack fighter jets had been moved to bases closer to Ukraine, in the latest sign of planning for an invasion. The build-up has slowed in recent days, but Russia retains some 100,000 soldiers along the border, poised for a ground offensive if Putin decides to act.
American and Russian diplomats met to broker a solution to the Ukraine crisis on Monday, the first of three sets of bilateral talks planned for this week. Wendy Sherman, deputy secretary of state, described the talks as “frank and forthright”, but said there had been no concessions from either side, and no evidence that Putin was ready to de-escalate the crisis.
Russian envoys will hold talks with Nato in Brussels tomorrow, with Moscow still demanding a pledge that Ukraine never be admitted to the alliance. Sherman said the Russian demands were “non-starters” and the US would “not allow anyone to slam closed Nato’s open-door policy”.
Russia, in turn, has rebuffed calls to withdraw its troops from the border, insisting that they are conducting routine exercises and have no plans to invade.
In Washington, the Texan senator Ted Cruz is leading efforts to impose sanctions on businesses associated with the 750-mile Nord Stream 2 pipeline.
Chris Murphy, a Democratic senator, said the proposal would create chaos, undermining American diplomacy and threatening a fracture with the nation’s European allies.
“This is not good policy for the Senate to allow Ted Cruz to break us from our transatlantic partners in the middle of a delicate negotiation over the future of US-Russia, and Europe-Russia policy,” he told CNN.
The Democrats are drafting an alternative to the bill proposed by Cruz that would impose tough new sanctions on Russia only if it invades Ukraine. Yet White House efforts to block the bill are being hampered by several Democratic senators wary of appearing soft on Russia before they face voters at midterm elections in November.
A breakaway by Democrats in the Senate, which is tied at 50-50, could push the bill closer to the 60 votes it needs to pass, inflicting huge embarrassment on the White House at home and torpedoing the diplomatic effort abroad.
Nord Stream 2 was completed in September but is yet to come online. The €10 billion pipeline, which goes through the Baltic Sea, will double gas supplies from Russia to Europe to 110 billion cubic metres per year. The pipeline bypasses Ukraine, a traditional transit country for Russian gas, depriving its economy of fees that represent about 4 per cent of its national GDP.
Robert Menendez, the Democratic chairman of the Senate foreign relations committee who has prepared the alternative draft bill, said his plan represented the “mother of all sanctions legislation” against Russian businessmen and industry — if Putin invades.
Ukraine has called the pipeline a “geopolitical weapon,” intended to punish it for its pro-western stance and drive a wedge between European allies. Other critics say Nord Stream 2 will increase Europe’s dependence on Russian gas and allow the Kremlin to exert political influence at a time of rising tensions with the West.
The Biden administration opposed the pipeline but stepped back from imposing sanctions to avoid a row with Germany. That dismayed Ukraine, which claims Russia is exploiting Europe’s shortage of natural gas to divide regional allies.
Tensions over Ukraine have been building steadily in recent months amid fears that Russia will attempt a repeat of 2014, when it annexed the Crimean peninsula after the pro-western revolution that overthrew President Yanukovych, an ally of Putin. Some 14,000 people have been killed in the fighting in eastern Ukraine, though Russia has repeatedly denied that it has troops there.
Two rounds of direct talks between Biden and Putin last month failed to defuse the crisis, with Russia still demanding the withdrawal of Nato troops and bases from eastern Europe, and guarantees that Ukraine and Georgia be barred from joining the alliance.
However, US officials believe that Russia’s window for an invasion of Ukraine has narrowed, The New York Times reported. A relatively mild winter has delayed the hard winter freeze that would be needed to move heavy weapons, military vehicles and equipment overland before the spring thaw brings a muddy quagmire.
The London-based Net Zero Watch is a campaign group set up to highlight and discuss the serious implications of expensive and poorly considered climate change policies. The Net Zero Watch newsletter is prepared by Director Dr Benny Peiser - for more information, please visit the website at www.netzerowatch.com.
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