Back in 2016, I argued that we needed to tackle reducing the demand for energy as if it was a major infrastructure project. Now the Independent Committee on Climate change have reached a similar conclusion. Of course, translating that report into practice will no doubt take more time, but each year we delay, means a continuing waste of resources.
Obsessed as government is with Brexit, I'm not optimistic that the policy changes we need will be implemented. The recent viral video from the US shows how hard it will be to get politicians to give up their entrenched positions.
“I’ve been doing this for 30 years. I know what I’ve been doing,”
The irony is that, when Feinstein said she’s been “doing this for thirty years,” she described the precise time period during which we could have acted. James Hansen brought the climate question to widespread attention with his congressional testimony in 1988. If we’d moved thirty years ago, moderate steps of the kind that Feinstein proposes would have been enough to change our trajectory. But that didn’t get done, in large part because oil and gas companies that have successfully gamed our political system didn’t want it to get done. And the legislators didn’t do anywhere near enough to fight them. So now we’re on the precipice. Indeed, we’re over it. The fires that raged in California last fall were the fires of a hell on earth.
The graph above is taken from the recently published report by Shelter. It shows the parlous state of social house building since 1923. I've written quite a lot about housing on this blog but this report makes it clear that things are as bad as ever.
From the Second World War up to 1980, we were building an average of around 126,000 social homes every year. Last year, there were only 6,463 new social homes.
...
If we continue as we are, only half of today’s young people are likely to ever own their own home – and a generation of younger people and many who are retired will spend their lives struggling with insecure, expensive renting. Over the next twenty years, hundreds of thousands more people will be forced into homelessness by insecure tenancies and sky-high housing costs.
We can't afford to continue as we are. The collapse of social housing began with the Right to Buy enshrined in the 1980 Housing Act but has continued through successive governments of both main parties and during the coalition period. The ballooning welfare bill is not down to the recipients of housing benefit, Universal Credit or any of the other myriad forms of support available, in theory anyway, to those who can navigate the bureaucracy. It is because those successive governments have simply ignored the problem, the Tories giving way to nimbyism while Labour targeted Tory voters by shifting right and embracing Thatcherism.
We estimate that public expenditure on housing in England was £26.8 billion pounds in 2016-17.
Public spending on housing has lagged behind expenditure on other public services over the past twenty years and the focus of spending has increasingly been on housing benefits rather than investment in new social or affordable housing.
Real terms housing benefits payments in England have been on a long-term upwards trend, more than doubling since the start of the 1990s. The increase is mainly due to rising housing benefit payments per caseload as real terms rents for all tenures have increased. However, an increased reliance on private rented sector tenures has also raised the housing benefit bill and the cost in rents to tenants.
Reduced investment has lowered the number of additional social rent homes being delivered each year. Social rent housing additions have fallen by 79 per cent since the first half of the 1990s.
Grant funding for social housing has been limited since 2011. Instead, the focus has predominantly been on making funds available for affordable rent homes or the Help to Buy equity loan scheme.
In another background paper, Shelter provides estimates of existing unmet need for housing:
Homeless in temporary accommodation
79,900
Rough sleeping and hidden homelessness
128,000
Overcrowded
240,000
Living with poor conditions in the PRS
631,000
Ill health/disability
194,000
TOTAL
1,272,900
On top of that they estimate a need for a further 1.2 million homes to address the anticipated increase in existing and newly forming lower income young households who are not expected to be able to afford home ownership in their lifetimes and some 690,000 homes for older (aged 55 and over) households on lower incomes currently in the private rented sector (PRS).
According to Shelter, this 20-year programme will provide a return on investment in 39 years, and would cost £10.7bn a year on average. However by reducing the demand for housing and other benefits by reducing housing costs this would be reduced to £3.8bn a year. It isn't a part of the Shelter proposals but these savings would be significantly enhanced if these new homes were built to the zero energy standard described in this earlier post
We are now ten years on from the financial crisis, and a worsening housing crisis is affecting more and more people. Adding this to the social polarisation triggered by Brexit it is clear that we need a new political consensus. Building such a consensus around an ambitious commitment to improve social housing offers a way out of that divide.
Back in 2014, I wrote a post looking at the dominance of London and the disproportionate spending on infrastructure in London and the SE compared to the rest of the country. Since then things haven’t improved.
Up to now this has been a Brexit free zone, but inevitably as I disengage from Facebook, that must change.
A frequent mantra from the leave side has been the call for an 'end to free movement of people'. It's worth deconstructing that statement to expose the illiberal elements behind so much of the Leave campaign.
The argument is of course couched in terms of stopping 'them' from coming here and taking our jobs. There is no evidence of that in reality, but we'll pass that by for now. Creating the idea of the 'other' is one of the first steps of dictators and would-be dictators everywhere. That 'other ' doesn't even have to exist of course, but if you have a visible target it makes it so much easier. That's what's behind the hyperbole of the leavers as they endlessly and angrily froth at the mouth every time any of the 'little people' has the temerity to speak up.
But we'll pass over that for now, too.
What none of them are saying is that the end to free movement cuts both ways. As we stand, anyone in the EU has unlimited ability to trade, work or study anywhere else in the EU - that's over 500m people and a collective economy worth around $19m representing about 22% of the world economy. The UK economy makes great use of that facility - watch any news item about medical or scientific research and you will see them. According to a report produced by the British Academy some 40,000 non-UK EU staff work in UK universities. These people are critical to maintaining the high standard of UK Universities in international league tables. Looking the other way, research by the Royal Society (pdf) indicates that almost 70% of active UK researchers in the period 1996 – 2011 had published articles for which they were affiliated with non-UK institutions, indicating that they had worked abroad at some point during that period. Some of those researchers may have moved for relatively short periods, but UK-based researchers also move for longer periods: 21% of UK-based researchers worked abroad for a period of two years or more during the same period.
All of this is at risk. In January it was reported that over 2,300 EU academics resigned from British universities in 2016-17, a 19 per cent increase in departures compared to before the EU referendum, and a 10 per cent rise from 2015-16. It seems likely that this applies outside academia too. The government recently published (pdf) an analysis showing all Brexit scenarios would hurt the economy while a separate report from the Bank of England, warned economic output in the U.K. could drop by as much as 8 percent if Britain drops out of the EU without a deal in place, compared to expectations had the U.K. stayed in. That compares to a 6.25 percent drop during the 2008 financial crisis.
Best estimates for British citizens in the rest of the EU are that there are between 1.8 million to 3.6 million British people living part-time or full-time in the EU27. This is imprecise because of the difficulties of reconciling data from 27 different countries with different definitions (so much for the EU juggernaut) but even the lowest is significantly higher than the suspiciously precise ONS estimate in April 2018 of 748,900, although much closer to the UN estimate that had been previously accepted of 1.22m. The difference lies in the fact that thge ONS definition only includes people living elsewhere in the EU for 1year or longer. This excludes seasonal workers, second-home owners, students and other mobile individuals who move backwards and forwards and who, having exercised their rights to freedom of movement, are as likely as any to be affected by Brexit. I'm a case in point - in 2000-2005 I earned a substantial part of my income from contracts in Ireland, based in the UK, but travelling regularly to Ireland for meetings and site visits.
British residents in Spain appear to be a significant issue. This paper concludes that "there are some frail, vulnerable people that may fall through a support gap, whereby they are no longer the responsibility of UK welfare services, yet not fully recognised in their new country of residence..." Depending on the outcome of Brexit many of these people may find themselves forced to return to the UK, a country they may have left decades before, possibly impoverished and requiring significant social care. The implications for an already stressed adult care system in the UK are unknown.
You have to believe in facts. Without facts there's no basis for cooperation. If I say this is a podium and you say this an elephant, it's going to be hard for us to cooperate.
As Obama said in the same speech, the denial of facts could be the “undoing” of democracy.
“People just make stuff up,” he said. “They just double down and lie some more. Politicians have always lied, but it used to be that if you caught them lying, they’d be like, ‘Oh, man.’ Now they just keep on lying!”
Facebook usage declined in 2018 for the first time ever - at least in the US. It wasn't just a small decline either, but back to 2015 levels from 67 percent of Americans aged 12 and older to 62 percent of that same audience. This drop is seen in every age and gender demographic as well. It’s not as if only young people, or older Americans, or women are using Facebook less. Every studied group is using Facebook less. That's still a huge number of course, but it is significant. I'm not in the US but I'm a good example I think of why this decline is happening.
Their lack of real concern for privacy coupled with the refusal of Zuckerberg to answer questions in the UK about alleged interference in the UK referendum via Facebook (and possibly also in elections via Cambridge Analytica) came together to build a real suspicion of the whole platform. Of course I never trusted them fully in the first place, any more than I trusted any other giant corporation, but now that distrust is active, based on things I suspect they did, rather than passive and based on general suspicion about lack of action on their part.
The other factor in my case, that led me about a year ago to leave almost all the groups I'm in, was a substantial number of disturbing and distressing examples of racism and antisemitism dropped into ordinary discussion threads as if of no consequence. Add to that the increasing numbers of only just literate posts on almost any topic and the apparent inability of too many people to read more than a sentence without missing the point just led to a general stepping back.
I realised that my use of Facebook was also a factor in my failure to keep up this blog. It was easy to post a short paragraph or a link, but also too easy for vituperative arguments to erupt over nothing in particular or over some alleged slight in the choice of a word or phrase leading in the end to as much time being taken, but much less fruitfully, over that paragraph as would have been the case over a couple of thousand words in a blog post. I didn't reach as many people of course, but if a reader can't follow an argument over the equivalent of a page or two of text, they are quite frankly not my target audience anyway. We need to find a way to reach those people but I'm not the one to do it.
Length is not of course a guarantee of meaningful content as the vapid outpourings from the likes of Boris Johnson demonstrate. It's at times like this that I miss the likes of Christopher Hitchens
Beware the irrational, however seductive. Shun the Supernatural and all who invite you to subordinate or annihilate yourself. Distrust compassion; prefer dignity for yourself and others. Don't be afraid to be thought arrogant or selfish. Picture all experts as if they were mammals. Never be a spectator of unfairness or stupidity. Seek out argument and disputation for their own sake; the grave will supply plenty of time for silence. Suspect your own motives, and all excuses. Do not live for others any more than you would expect others to live for you.
We should be, without hesitation or embarrassment, utopians. At the end of the twentieth century it is the only acceptable political option, morally speaking. I shall not dwell on this. I will merely say that, irrespective of what may have seemed apt hitherto either inside or outside the Marxist tradition, nothing but a utopian goal will now suffice. The realities of our time are morally intolerable. Within the constricted scope of the present piece, I suppose I might try to evoke a little at least of what I am referring to here, with some statistics or an imagery of poverty, destitution and other contemporary calamities- But I do not intend to do even this much. The facts of widespread human privation and those of political oppression and atrocity are available to all who want them. They are unavoidable unless you wilfully shut them out. To those who would suggest that things might be yet worse, one answer is that of course they might be. But another answer is that for too many people they are already quite bad enough; and the sponsors of this type of suggestion are for their part almost always pretty comfortable.
I can't claim to match either of these greats, but for the future expect me to spend less time on Facebook and more time writing or blogging.
The decision to go ahead with Hinkley C is I think pretty disastrous. It ties us, probably for the next 40 years, to a nasty, poisonous, highly centralised and potentially vulnerable system of energy production, it lumbers us with a hugely expensive long term contract to pay very high prices per unit for the electricity produced.
All the media coverage of the Hinkley decision is about the so-called ‘gap’ we are facing between the demand for energy and the available supply. Completely missing though is any consideration of the savings that could be made by improving energy efficiency. This is a failure of imagination but it also masks a lot of vested interests. Improved energy efficiency and a move away from centralised generation of energy would damage the profits of the generation companies and their partners the big construction companies. The financial backers also have a lot of money at stake. China in particular has undisclosed political objectives in securing a stake in UK energy and their potential later involvement in design and construction of nuclear plant raises worrying questions of security.
Government failures on energy efficiency
The government has abandoned its commitment to require all new homes from 2016 to be carbon neutral. That commitment would have ensured that all new dwellings from 2016 would generate as much energy on-site – through renewable sources, such as wind or solar power – as they would use in heating, hot water, lighting and ventilation. This was to be supported by tighter energy efficiency standards that would come into force in 2016, and a scheme which would allow housebuilders to deliver equivalent carbon savings off site. This back step was done on the back of a claim (pdf file) to be reducing “net regulations on housebuilders.”
CO2 emissions make up about a third of all greenhouse gas emissions and these are projected to rise to 50% by 2050. The UK’s building stock is among the most inefficient in Europe, has the highest levels of fuel poverty of a dozen comparable EU nations, as well as one of the worst proportions of homes in a poor state of repair. Over 10m British families live in a home with a leaking roof, damp walls or rotting windows. The Coalition’s cut to the Energy Company Obligation will by 2017 have led to 400,000 fewer households getting help to reduce energy bills by improved efficiency. This is despite our treaty obligation to reduce emissions by 80% and the new obligations that will come from the Paris Treaty on Climate Change.
The cheapest energy of all is that which isn’t used.
In practice though, arguments about sustainability, CO2 emissions etc are not required. The cheapest energy of all to the consumer is that which they don’t have to use. The requirement for zero carbon homes would have had a huge impact across the board, by reducing fuel bills for those in the houses built to that standard and in the knock on reduction in demand.
The cost benefit of abandoning the requirement is small. According to a report (pdf) produced in 2014:
At 2014 prices, the typical additional cost of building a semi-detached house to the zero carbon standard could be less than £5,000.
Since 2011, costs have roughly halved. There are a number of reasons for this including the falling cost of solar PV, changes in the zero carbon definition, and greater efficiency in meeting air tightness standards.
By 2020, the cost of building a new zero carbon semi-detached home could be less than £3,500.
There is a range of evidence-based examples that demonstrate that highly fabric energy efficient homes do not cost more than conventional construction if cost strategies, program management and environmental strategies are built into project plans at the procurement stage.
What can we get for the cost of Hinkley?
Hinkley C is estimated to cost around £19bn to build. Inevitably this will be be higher and on past experience of major capital schemes in the UK it could be as high as £45bn. I'm going to assume a figure for the moment however of £30bn and a 15 year construction period. This equates to £2bn pa. Subsidies on generating costs are estimated at £32bn over 35 years. Rounding that up gives us another £1bn pa. So, ignoring financing costs the annual cost of Hinkley C over the first 15 years is going to be of the order of £3bn pa. The total over the 15 years would be £45bn. What can we get for that money?
Research conducted for the Town and Country Planning Association suggests that we need something like 220,000 new houses in England every year for the next 15 years. This is apparently lower than previous estimates but the research also shows that this is because many people now can’t afford their own home – either to rent or buy - and are living with parents or other people longer than they would like to. Other sources suggest a more realistic figure is around 250 – 300,000. For the ball-park estimates I’m going to make I will assume 250,000.
From the studies cited earlier the additional cost of building these new homes to zero carbon standards will be around £3500 per house. For the purposes of these figures I’m going to assume that this remains at this level, rather than reducing further. So, for 250,000 houses the additional expenditure over current standards would be £8.75m per annum. Over 15 years this adds up to £13.125bn.
The average electricity bill was around £600 pa in 2015 and for gas about £750. Assuming 80% savings in gas and 40% for electricity (very conservative assumptions) reduces these to an annual total of £840 per household which would be released for other spending. At 250k houses per year that is a total of approximately £200m for each tranche of houses built. After 15 years this equates to a continuing annual saving for consumers of £3.3bn and cumulatively over the 15 year period of just over £28bn. This money would be spent elsewhere in the economy so having a further impact.
Bringing existing houses up to the same standard is more of a problem of course. As far as I can see the number of houses in England is around 21m. Retrofitting these to zero carbon standards will be difficult for many and impossible for some. Doing so may well also involve accepting significant changes in external appearance. Accepting the need to do so, may also shift the balance of what it is economic to refurbish and thus require additional new houses over and above the figure of 250k pa quoted above.
Again for the ball park figures I am aiming to produce, I’m going to assume that something like 20m houses can be brought up to zero carbon standard at an average cost of £10,000 per property. That equates to a total of £200bn. Assuming this work is carried out over a 25 year period, it would require 800,000 houses to be retrofitted every year, with an annual cost of £8bn. The cost over 15 years would be £120bn This is a substantial sum, but needs to be put into the context of major infrastructure projects such as Crossrail - c£15bn, Crossrail 2 – estimated at £27-32bn, HS2 – estimated at c£50bn including rolling stock, and of course Hinkley itself.
There would also be significant savings in energy use, further reducing demand and energy costs, so releasing money into the economy. Assuming the same levels of reduction in energy costs as with new build, the savings to consumers would be approximately £670m for each annual tranche of improvements, a continuing annual saving after 15 years of almost £11bn, cumulatively over the 15 year period I’m using this adds up to about £90bn and over the full 25 years to an astonishing £235bn.
Other impacts of the programme will be significant.
I have so far ignored the multiplier effects of the increased spending power released by the savings on energy. This depends on household’s marginal propensity to consume (mpc) or its marginal propensity to save (mps).
The following general formula to calculate the multiplier uses marginal propensities, as follows:
1/1-mpc
Hence, if consumers spend 0.8 and save 0.2 of every £1 of extra income, the multiplier will be:
1/1-0.8
= 1/0.2
= 5
Hence, the multiplier is 5, which means that every £1 of new income generates £5 of extra income.
Using that 80/20 split, which seems close to the current figure for lower income households, and applying it to the total annual savings in year 15 of £118bn, would mean the generation of some £600bn of extra income in that year alone. This is probably an overestimate, since this is a transfer of expenditure from energy bills. However the impact of that money dispersed through the economy is likely to be greater than when spent on energy, particularly since so much of the energy sector is foreign owned, so transferring money out of the UK.
Even assuming a figure of only 25% of that, the impact would be significant.
Summary
To summarise therefore:
Cost of Hinkley estimated at £30bn.
Subsidies on generating costs £32bn
Construction period 15 years
This should be set against:
Additional cost of new build to zero carbon standard over 15 years estimated at £13.125bn
Cost of retrofitting existing stock to zero carbon standard over 15 years estimated at £120bn
Estimated reduction in household energy costs over 15 years.
New Build estimated at £28bn
Existing stock estimated at £90bn
Multiplier effect of expenditure transferred from energy bills
in year 15 - £13bn
over full 15 year period - £113bn.
Conclusion.
All these figures are very crude, but show two things:
The approval of Hinkley was a bad decision and poor value for money.
The substantial gains to be made by investing in energy efficiency on a scale comparable to the major infrastructure projects like Crossrail, HS2 and Hinkley. These have been ignored by successive governments. We cannot afford to continue to do so.
C4's conspiracy thriller Utopia has a fascinating web-site attached, describing how we are being watched by government and others and our privacy invaded - but also the many ways in which we collaborate, willingly or from ignorance, in that process. Did you know for example that the government are considering ways to use ANPR cameras at filling stations to restrict access to fuel for uninsured drivers? Of course it
doesn't have to be the uninsured. You just might be on a list somewhere and making you buy fuel more frequently keeps you under observation and limits your mobility.
Remember - just because you are paranoid, doesn't mean they are not out to get you...
The proposal by South Yorkshire Police Authority to replace police on the beat with PCSOs as the first point of contact with the public is interesting for a variety of reasons. It was of course suggested that this would happen when PCSOs were introduced some 10 years ago. It is surprising perhaps it has taken this long. However the very idea of a separate 'public' cuts against the traditional philosophy of policing in the UK as set out in Peel's Principles of Policing, #7 of which says:
Police, at all times, should maintain a relationship with the public that gives reality to the historic tradition that the police are the public and the public are the police; the police being only members of the public who are paid to give full-time attention to duties which are incumbent upon every citizen in the interests of community welfare and existence.
A Police Federation spokesman, interviewed on BBC R4 'Today' programme this morning described PCSOs as 'civilians', thus creating a definite sense of us and them. It seems that the modern pattern of policing, supported by police and politicians alike, has abandoned Peel in favour of the idea of an occupying force, keeping down a hostile populace.
That shift of perspective is dangerous. See for example Principles 2, 3 and 4:
Principle #2: The ability of the police to perform their duties is dependent upon the public approval of police actions.
Principle #3: Police must secure the willing co-operation of the public in voluntary observation of the law to be able to secure and maintain the respect of the public.
Principle #4: The degree of co-operation of the public that can be secured diminishes proportionately to the necessity of the use of physical force.
The more the Police consider themselves outside and above the general public, the worse it will get.
(Greater Manchester )Police have warned anyone planning to cause trouble at a trades union march in Manchester that robust action will be taken against them.
