Green levies may well be 'crap'. The way to deal with carbon is to bury it

2nd December, 2013

We are going to continue to use fossil fuels, so let's make carbon burial the number one priority

Who knows whether David Cameron really called green levies "crap". Downing Street has denied it, sort of. But everyone seems to accept that the autumn statement will contain a significant rolling back of environmental charges on energy bills.

Environmentalists and Liberal Democrats respond with grim-faced resignation, hoping that any rollback will be small and temporary. But with the roaring success of Ed Miliband's energy price freeze idea, the next election is likely to see the major parties duelling over who can roll back green levies fastest.

In the spirit of "never let a good crisis go to waste", now might be a good time to ask: is making fossil energy more expensive and using the proceeds to subsidise efficiency measures and carbon-free sources actually going to solve the problem of climate change? I'm not convinced it will.

My neoliberal economist colleagues assure me that putting a price on carbon is the most efficient way to reduce emissions. I'm not an economist, but I do get it: put the price up on fossil fuels and people will rationally find other ways to generate that energy or decide they didn't need it in the first place.

Being a physicist, not an economist, I also understand that reducing carbon emissions by a fraction is not going to solve climate change. Carbon accumulates in the climate system. So reducing emissions by 10% means we take 10% longer to reach any given threshold for dangerous climate change. To actually solve the problem, we need to reduce emissions to zero. Defenders of green levies need to explain how they are going to achieve that.

It is easy to point to examples of wasteful uses of fossil carbon today. Of course we could all heat our homes more sensibly. But we don't, that's the point. How many of us honestly even know what our monthly energy bills are?

Even if we do cut down on unnecessary emissions, there will always be productive uses of fossil carbon, no matter what the carbon price. UK petrol duties are equivalent to a carbon tax of over 200 per tonne of CO2, and we're still driving. If we were all to drive Priuses, we could cope with even higher fuel prices.

The only way a carbon tax, or the price of a carbon trading permit, is going to get net carbon emissions to zero is for it to rise high enough that it makes more sense to bury carbon dioxide rather than pay the tax or buy the permit. Estimates of what this means are in the region of 50-200 per tonne of CO2. The green levy on gas amounts to well under 20 per tonne and permits under the European carbon trading scheme are wobbling around 5 per tonne or less. Can anyone imagine our politicians holding their nerve as they ratchet up green levies to price carbon out of the economy?

We already know that a successful climate policy means that carbon burial will have to become, in effect, compulsory at some point in the next few decades. And the chances of this being delivered through a carbon price are nil. The only institution in the world with the resources to get carbon burial technology deployed fast enough to prevent more than two degrees of warming is the extractive fossil fuel industry. They won't do it voluntarily; it won't happen through any conceivable carbon price; so it will have to be done by regulation.

People complain that making carbon burial compulsory is "putting all your eggs in the CCS [carbon capture and storage] basket". But if eggs are what you have, an egg basket is what you need. We are going to continue to use fossil fuels. We are going to burn more fossil carbon than we can afford to dump in the atmosphere. Do not fantasise otherwise.

Every credible scenario for avoiding more than two degrees of warming involves deployment of carbon burial at an eye-watering rate from the 2030s onwards. So we will eventually need large-scale carbon burial and the only way we are going to get it in time is by making it a licensing condition for extracting fossil fuels, as they have done, without any political fuss, in Western Australia.

So when George Osborne announces the rollback of green levies in his autumn statement, the Department of Energy and Climate Change could quietly announce a timetable for the rollout of a compulsory carbon burial regime and no one could complain about the climate.

With climate change taken care of, we can then have a much more sensible discussion of whether "social cost" levies are a good idea in general.

Too few of us are interested in researching home insulation and price-comparison sites to leave energy policy entirely to an open market. So the real reason we need high and consistent energy prices today is to drive the investments in efficiency and generation capacity needed to keep the lights on in the 2020s and 2030s, particularly when the costs of compulsory carbon burial start to bite.

Will the Sun admit "We Was Wrong" to declare war on high energy prices in 2013 when the first power cuts hit? Of course not, because the levies they are complaining about are called "green". But these levies won't solve the climate problem, so call them what they are: nothing to do with the environment, but a small price to pay for longterm energy security..

And solve the climate problem by making carbon burial compulsory. We'll have to do it someday, and the sooner we start, the slower and less painful the rollout.

Source: The Guardian

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