It’s a net loss for net zero: The perils of climate coercion


By Ambrose Evans-Pritchard

Climate coercion is a very bad way to cut greenhouse gas emissions in Western democracies.

The reflex of sweeping bans is already provoking a bitter backlash in Europe. If leaders persist in using the sledgehammer of legal prohibitions, they risk derailing the energy transition and perpetuating the expensive fossil fuel order, with all its baggage of rentier autocracies, cartel price-fixing and geostrategic blackmail.

The only choice in Western societies is to face up to it and do what the Biden administration is doing: switch to a war-footing to end reliance on fossil fuels and advance clean energy.

The only choice in Western societies is to face up to it and do what the Biden administration is doing: switch to a war-footing to end reliance on fossil fuels and advance clean energy.Credit: Jessica Shapiro

America is making a better fist of climate politics by investing its way through the Valley of Death, the phase of maximum disruption before you secure the cascading gains of better technology.

It is selling the green drive a) as a pro-growth strategy of “jobs, jobs, jobs”, and b) as a patriotic strategy of national economic security in the face of China’s bid for global clean-tech dominance.

Germany’s failed attempt to impose a de facto ban on the sale of home gas boilers from the end of this year is a lesson in how to destroy national consent; doubly so given that the Green Party behind this extreme measure is also responsible for the lunacy of shutting down three young, safe, and productive nuclear plants in the middle of an energy crisis.

One cannot duck the issue of climate change. That is defeatist nihilism.

The political storm has revived the ailing Alternative für Deutschland (AfD), propelling it past the Greens and the ruling Social Democrats to 20 per cent in the polls. AfD is now the leading party across most of old East Germany and won 53 per cent of the vote over the weekend in a district election in Thuringia.

Germany’s heat pump industry is not physically capable of covering such a sudden switch from gas boilers. Heat pumps will become cheaper over the course of the 2020s, and new technologies are arriving that could let you keep old radiators without having to rip up the house. We are not there yet.

I am all in favour of kick-start subsidies to drive down the costs through critical scale, but you have to go with the grain of public acceptance.

The ban was certain to enrage that chunk of German society that has been pauperised by wage compression, austerity cuts that have fallen chiefly on public investment, and a mercantilist economic model set in the interests of the exporting elites, all now compounded by a cost-of-living shock comparable to the ordeal in Britain (and Australia).


The Netherlands has been living through its own political earthquake. The BoerBurgerBeweging or Farmer-Citizen Movement has risen from nowhere to become the largest party in the Dutch senate and in every regional administration.

That is what happens when you set about the closure of 11,200 farms, by forced sales if need be, and when you compel another 17,600 farms to slash their livestock by a third to meet EU nitrogen emission rules, under orders of Dutch court judges interpreting those rules.

What happened to the EU’s other objective of restoring Europe’s food sovereignty after the shock of Putin’s war?

There is a way to reduce emissions and water use in farming without the brutality of forced shrinkage. It is called ag-tech. It entails broader use of GMO crops, until now obstructed by the EU’s precautionary principle.

Furthermore, the world can meet its entire need for fertilisers (3 per cent of CO2 emissions) from green hydrogen made in desert regions. Nor is it clear to me that farming should be near the top of the ladder for emission cuts when we already have the means to decarbonise electricity and most transport at no marginal cost.

Climate policy is becoming the critical dividing line of ideological politics in the 2020s. Hard-Right parties making hay out of net zero mostly have a electoral ceiling near 20 per cent.

The chief effect is to alarm centre-Right parties, afraid of voter haemorrhage on their right flank. We see it in Bavaria. We see it in Britain where the Tories are scraping away their green tattoos to head off Nigel Farage, who thinks he has found another winning cause.

One cannot duck the issue of climate change. That is defeatist nihilism. Nor can one keep hiding behind China, given that the Chinese are rolling out 55 per cent of the world’s new renewable power in 2023 and 2024 (IEA data).

Steering through the Valley of Death

The only choice in Western societies is to face up to it and do what the Biden administration is doing: switch to a war-footing, mobilise universities in multiple Manhattan Projects to smash the technological barriers, and use unlimited tax credits to achieve take-off across the gamut of electrification, energy storage, green hydrogen and carbon capture.

Pork barrel politics works like a charm. The Battery Belt runs through Trumpland. Republican districts are being bathed in clean-tech investment. It is the method used by Lincoln to push through the 13th Amendment abolishing slavery.

The debt ceiling revolt by the Freedom Caucus ended in a whimper. Joe Biden had to compromise on pipelines and oil and gas licences, but the Republicans essentially accepted his green deal, in part because it was seen as a national security imperative to counter China.


Mobilising trillions is not as easy today as it was when interest rates were at zero and the world was awash with excess capital. However, we may well return to those conditions within two years. A body of scholarship suggests that the natural rate of interest globally remains pinned to the floor.

Personally, I am against the UK’s car and petrol ban in 2030, both because it deprives free people of moral agency and because it is pointless. The life-cycle cost advantage of electric vehicles will be blindingly obvious by then. Range anxiety and chargepoint trauma will be long forgotten. The technology is by now unstoppable.

Nor do I care much about the go-ahead for Cumbria’s coking coal mine. If consenting adults want to lose money investing in an obsolete concept, and if the locals want it, then let them, so long as the company posts a decommissioning bond to cover the clean-up after the project goes bust.

Europe’s steelmakers are already switching to a cleaner DRI [direct reduction in iron] process that moves beyond coking coal.

Polluters must pay

The caveat, always and everywhere, is that CO2 and methane polluters must pay.

If you drive a needlessly large hunk of metal extracted and manufactured at some stress to nature, and expect to draw on scarce resources to power this deadweight for years to come, you ought to pay a stiff surcharge to society. It is not happening yet.

The ETS carbon price in the EU and the UK is too patchy to send a meaningful signal.

An alliance of Nobel laureates and economists of all stripes is calling for a carbon tax and dividend that covers everything and ratchets up each year until the problem is solved (probably circa $US100 a tonne), acting as a potent lever of decarbonisation by steering investment.

The poorest are net beneficiaries since they mostly have a lower carbon footprint. They receive a tax-free cheque in the post every three months marked “climate dividend”. It rises constantly. That is how you get through the political Valley of Death.

Such a scheme does not pick winners and losers. It lets the markets decide on the best technology. It does not boss people around or shout at them. It lets them make their own judgment.

In a free and informed society citizens usually rise to the moral challenge once they have the right information. So let us stop banning things, and please, while we are at it, could we drop the poisonous term “net zero”.

Telegraph, UK

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