It’s hard to imagine that Britain could have messed up more. At least in comparison to Norway, who share with Britain the riches that come from underneath the North Sea.
In 2020, Britain’s total oil revenue from there was barely £0.2 billion. Strangely, Norway, producing the same amount of oil, managed to accrue more than £9bn. How can that be, I hear you ask? Britain privatised its oil and gas industries yonks ago, while Norway’s is state-owned. Simples.
Back in the 1990s, Britain was spending its newly-found wealth, while Norway created a sovereign wealth fund, the Oljefondet. It is now the largest such fund in the world, with over $1.3 trillion in assets. That works out at a quarter of a million dollars for every one of its 5.3 million folk! Serious money.
Over a decade ago, John Hawksworth, chief economist at PricewaterhouseCoopers wrote a paper called “Dude, where’s my oil money?” It has been conservatively estimated that had Britain gone down the same road as its North Sea partner, it would then already be worth £450billion. Serious money.
When the oil revenues were flowing in, the Thatcher government lowered taxes. At the top end, mind you, so only the wealthy benefitted. Amazing, but the Tory party never changes. It was only the wealthy that interested them then, and it’s exactly the same today.
Britain remains the only place that doesn’t tax the oil industry. Indeed, it offers tax rebates. And it’s not going to get any better for Britain. It’s estimated that during the next forty years, it will cost over £51billion to decommission the North Sea rigs plus, of course, more billions in tax rebates.
And just to rub it in, those rather smart Norwegians not only helped oil workers losing jobs with their North Sea windfall, but they completely transformed home energy usage, so almost all its energy is now provided by renewables.
So, in answer to the question if Britain has messed up with energy, I would put it slightly differently; what an utter, monumental, foul and catastrophic British fuck-up.
Have we messed up with energy?
I believe, yes, 100 percent. Any proof?
I will try to explain it on an obvious case. It’s been a fashion in Europe and the United States to change from fossil-fuel type energy in favour of some ‘green’ stuff, like solar or wind energy. Yeah, I agree, coal is truly black out the skies, so it was right to skip it. Plus, it wasn’t as efficient as an energy source compared to the existing alternatives.
Public opinion, under media’s left-wing pressure, has begun shifting to it, too. Then it was discovered, like in the UK recently, that those sources could not be sufficient enough in terms of output. Moreover, they are also not reliable enough as the UK just doesn’t have enough sunny days to get energy from the nearest star. Some parts of Europe are not windy enough.
But the biggest point is Germany. Unlike, basically, all other developed countries from the US to Japan, to France to the UK, and, I suspect, elsewhere, Germans decided to abort all their nuclear-powered station networks.
What a stupid decision!
In terms of true resource assessment and strategic planning, it is comparable only to Putin’s bad miscalculation in Ukraine.
The extremist’s ‘green’ lobby put most Germans choosing to refuse nuclear energy, and they started to shut down their nuclear-powered stations. Germany’s remaining three nuclear plants — Emsland, Isar and Neckarwestheim — will be powered down by the end of 2022. Now, without it, they feel considerable gaps on the energy’s supply-side.
They recently realized the truth: all the renewable energy sources, like wind or sun, are just not enough to rely on. Well, as a nice supplement to your meal, probably. But the German’s menu is missing one of the main courses.
It even hits them back when it comes to sanctioning Putin’s regime, when it is time to refuse Russian oil and natural gas.
As a matter of fact, from the statistical point of view, nuclear energy is green and it is safe. We all remember Chernobyl but contemporary nuclear power stations work on a different technology.
Well, sometimes the greens can be the blind ones, too.
Have We Messed Up With Energy?
To my mind this is a non question. Everybody with half a brain knew what would happen to Germany the first time there was a falling-out with Russia. Yet there was big money to be made and the rich didn’t give a damn about what was bound to happen. It seems that politicians around the world are the same. Former German Chancellor Gerhard Schroeder, for example, stands to make real money from Nord Stream II and wants it to go forward, even now.
The Americans are no better: the high plains south of Chicago have been called the Saudi Arabia of Wind. The area has the potential to fill much of the nation’s growing energy needs. I know first hand that the entire region is almost empty. Building massive wind farms away from cities would be easy and solve many problems. The dusty, dead little towns need the money. So of course Trump makes it into some silly political controversy and has convinced many that “good, clean coal” is the answer.
There is a place for coal and it needs to be available. One lesson my Father taught me that still sticks is that you should always use the right tool for the right job. There are areas in the US that are often overcast; nuclear may be a viable answer there. But in general, I will argue the more green energy, the better.
Yet most of the developed world sticks to fossil fuels. There is big money to be made and the major oil companies don’t want to take the risk of moving into a new area (renewables) when they are already winning. Entire nations across the globe have a vested interest in maintaining the status quo.
So the West has ceded producing solar and wind equipment to China. The price of roof-mounted solar panels has fallen dramatically and will continue to into the future. You cannot stop the march of history, even if you’re a big oil multinational. But you can harm your own nation (Nord Stream II) and your own economy. By refusing to embrace renewables, the big energy companies and their politicians are going to harm their own markets.
Simply calling something good and clean doesn’t make it so. Natural gas is considered green in the EU. Its use is growing by leaps in the US. This is good but it should be seen as a part of a larger transition to even cleaner, safer, cheaper sources of energy in the future. Now, you know better, right? Once billions are being made off gas, the folks selling it are not going to give up that income without a fight. No, they will not get out in front of change and start building big wind farms and solar plants. They will take the safe route and hire PR firms to try to change the narrative. The politicians will fall in line and China will be waiting.
Have we messed-up? Some, but there is still time to screw-up big time and I’m sure we will.