Playing chicken with energy policy

(This post was programmed to appear automatically while I was away, but for reasons that I have failed to discover, did not do so. In light of what I have come across in the reading that I have done since my return, there seems to have been few developments since I wrote it, including some press comments that are unlikely to keep Mr Huhne smiling.)

In the aftermath of the general election, Chris Huhne has succeeded Ed Miliband at the helm of the Department of Energy and Climate Change. There can be no doubt that he will be navigating in some extremely stormy waters.

Of all the cabinet posts other than those relating to the public finances, this is probably the one that will come with the highest risks attached. I am not going to rehearse the evidence that, unless the UK gets a viable energy policy together immediately, there is a very real likelihood that we will be suffering a third-world type energy crisis within as little as five years, the intended lifetime of the current parliament. Huhne’s post at the DECC needs to be filled by someone who can think straight, think big and think fast. It is by no means certain that the present incumbent possesses all these qualities.

There is no reason to think that Huhne is a fool. He was educated at Westminster School, like his party leader Nick Clegg, before going on to  the Sorbonne and then Oxford where he took a first in PPE. As a student he was active in Labour politics.

He went of to become an economist in the CIty of London, rising to be the managing director of Fitch ratings, an international credit ratings agency, so it would seem that someone thought that he had management abilities; no bad thing for a minister. He has also had a successful career as a journalist, rising to be financial editor of the Independent and the Independent on Sunday.

After unsuccessful attempts to enter parliament in 1983 and 1986 he turned his attention to Europe and became a Liberal Democrat MEP for South East England from 1995 to 2005, when he was elected to Westminster as member of parliament  for Eastleigh. Since then, his rise has been meteoric.

Less than a year later, he challenged Sir Menzies Campbell for the leadership of the party, and although he lost, he received 21,628 votes to the winner’s 29, 697. Not a bad score for a new boy who started as a rank outsider. Huhne stood for the leadership again in 2007 when he lost to Nick Clegg by just 511 votes. He has served as his party’s environment spokesman.

The picture one has of Huhne is that of an extremely capable, ambitious and successful man in a hurry to get to the top.

For the British, coalition politics are a new experience. We have entered a political era in which some things are certainly being done very differently, but it is far too early to even begin to consider whether they are being done any better. For all the avowals of unity in the face of apocalyptic fiscal problems that we have heard during the last three weeks, there is little reason to suppose that the new Prime Minister, David Cameron, is playing the game so very differently from his predecessors. The pressures to watch your back if the keys of 10 Downing Street are to stay within your grasp haven’t gone away, and certainly not when there is someone like Chris Huhne about.

The formation of a coalition made it inevitable that some senior cabinet posts would go to Lib Dems, and there were quiet chuckles in Conservative ranks when one of the new prime minister’s first appointments was David Laws as Chief Secretary to the Treasury. ‘No bad thing’, said the Tory wiseacres, ‘to have one of those other people playing hatchet man during a time of austerity. It helps keep our hands clean if there is a surprise election’. Perhaps the thinking was similar where Huhne’s appointment was concerned.

Energy and climate change is likely to provide a very rough passage for whoever is in charge over the next few years, and Huhne is possibly the most unlikely person to be able to cope with this and keep any semblance of integrity.

There are two major problems that will face him. As a committed green, he cannot back-pedal on the reduction of carbon emissions. Yet even if clean energy was not a consideration, he would be facing colossal problems keeping the lights on. Can he possibly deal with the problem when many of the obvious solutions are already ruled out?

Also as a committed green, Huhne is anti-nuclear. He has already had to perform some fancy footwork where this is concerned, and it looks as though there will be a lot more to come.

In a recent newspaper article he is reported as saying that:

I am not an ideological ayatollah against nuclear power per se.

I am simply a sceptical economist about the record of nuclear power on delivering on time and to budget in a way that can make returns for investors.

He now claims that his objection to nuclear is entirely based on cost and the possible need for subsidies; merely the reservations of a shrewd economist. This sounds unconvincing.

I wonder whether he will use his fluent French to talk to his French counterpart, who presides over an electricity grid that is nearly 80% supplied by nuclear, with no fears of the lights going out, and supplies abundant enough to export large amounts of electricity to southern England.

Huhne certainly has a point about not subsidising nuclear generators. But he makes no mention of the vast subsidies to wind power, which are being taken straight out of the public’s pockets in the hope that no one will notice that this inefficient, unreliable, environmentally devastating, and very expensive form of generation can appear to be free of subsidy. Instead he talks about the rising cost of carbon eventually making nuclear, and presumably wind power too, competitive and able to stand on its own two feet. Of the obvious consequence that the consumer will have to pay more for electricity in  any case, he says nothing,

Few people who have thought about Britain’s parlous economic plight are now in any doubt that we face years – perhaps even decades – of austerity. Rising costs are likely to be on everyone’s mind, and particularly where something so ubiquitously necessary as electricity is concerned. Celebrating the supposed economically therapeutic effects of rising energy costs is likely to be very short-lived phenomena.

Given that all the opinion polls I have seen recently show an accelerating rise in scepticism about climate change, Chris Huhne’s first venture into public office looks doomed. Only a globally binding agreement on carbon emission reduction at Cancún in the autumn could make relying on green energy even begin to look credible, and if what one sees on the net is even half true, this is not a lifebelt anyone should rely on.

From a purely political point of view, Chris Huhne’s position is a very interesting one. His past activities in European politics must make him aware that present energy policy in the UK is dictated not by Westminster, but by emissions targets imposed from Brussels. The combination of climate scepticism and Euro-scepticism on the Tory back benches is likely to make any discussion of energy policy highly volatile, and this cannot have escaped David Cameron when he made the appointment. Presumably it was agreed with Nick Clegg, and one can hardly blame him for not intervening to protect an ambitious rival who has already tried to get his job twice, and only just failed to do so quite recently.

This all looks like high-risk politics of the most ruthless kind, with the future of the UK economy at stake. No industrialised nation can survive without an abundant, reliable and cheap supply of electricity. No country that is in the midst of a potentially catastrophic debt crisis can contemplate a vast hike in the cost of energy that will jeopardise its competitiveness.

As things stand at the moment, our energy policy is on a collision course with reality, and reality doesn’t usually chicken out.

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If anyone is wondering about the title of this post, my spelling skills are very poor in English and non-existent in German.