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Contact:
Foundation for Economic Growth,
P.O. Box 10-282,
Wellington, N.Z.
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The Nuclear Option.
By Muriel Newman
Sep 10, 2007, 10:32

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This week (14th September 2007): NZCPR examines the government’s climate change strategy, the NZCPR Guest Brian Leyland concludes their energy strategy is expensive, misleading and futile, the poll asks readers about their support for nuclear energy, and in the NZCPR NOTICEBOARD (at the end of the newsletter) the NZCPR Research Panel are invited to participate in a survey on attitudes to Climate Change…

At the APEC meeting being held in Sydney, member nations reaffirmed their commitment to reducing greenhouse gases with aspirational rather than binding goals. They have also opened the door for a greater use of nuclear energy.

Some Pacific Rim leaders have opposed the Kyoto Protocol’s binding targets - which require greenhouse gas emissions during the five years from 2008 to 2012 to be reduced to below 1990 levels - as they fear the cost impost on their economies is simply too great.

While Helen Clark now understands the huge price to our economy of compliance with Kyoto targets, she remains a staunch advocate. It has been said that the price to her international reputation, if New Zealand backed out of Kyoto, would be too much for her to bear. The question however, is whether the New Zealand public should have to bear the cost of Kyoto, or whether we should be demanding that the government pull out?

The Kyoto Protocol came into force on 16 February 2005. Under Article 27, a country is free to withdraw “at any time after three years from the date on which this Protocol has entered into force”. That means that New Zealand could serve notice of its intention to withdraw any time after 16 February 2008. (For more details on the Kyoto Protocol, click here>>>)

When Helen Clark signed the Kyoto Protocol on December 10 2002, she stated, "In ratifying the Protocol New Zealand accepts responsibility for tackling a critical global problem”. With the science over global warming still being far from settled, New Zealanders are being asked to shoulder the substantial costs - and the significant reduction in living standards that will result - for uncertain environmental benefits.

The key problem still remains that there is no conclusive evidence that man-made greenhouse gas emissions are creating a global warming crisis. As Professor David Bellamy, a recent NZCPR guest commentator has pointed out, since 1998 the world’s average temperatures have been falling, not rising: “The most reliable global, regional and local temperature records from around the world display no distinguishable trend up or down over the past century. The last peak temperatures were around 1940 and 1998, with troughs of low temperature around 1910 and 1970. The second dip caused pop science and the media to cry wolf about a catastrophic ice age just around the corner. As soon as the temperatures took an upward turn in the 1980’s the scaremongers changed their tune switching their dogma to imminent catastrophic scenarios of global warming”.

He explains that: “The concentration of carbon dioxide in the atmosphere has risen throughout this time frame, yet the temperature has gone up and down in a cyclical manner. How can this be explained unless there are other factors in control overriding the effect of this greenhouse gas? There are of course many to be found in peer reviewed literature, solar cycles, cosmic ray cloud control and those little rascals El Ninos and La Ninas all of which are played down or even ignored by the global warming brigade. There are no facts linking the concentration of atmospheric carbon dioxide with imminent catastrophic global warming there are only predictions based on complex computer models”. (To read his article, click here>>>)

In New Zealand, not only is there is no evidence of temperatures having increased, but last summer was the coldest in 30 years. Further, the National Institute of Water and Atmospheric Research (NIWA) has estimated that if global warming did occur, the effect on New Zealand would be at a level of about two thirds the global average. With the latest estimates from the UN Intergovernmental Panel on Climate Change estimating moderate warming in the region of 3 degrees Celsius, even if temperatures did rise by 2 degrees Celsius over the next 100 years, Auckland would still be colder than Sydney is today!

New Zealand’s climate change policy has been flawed from the start: Labour justified our signing up to Kyoto by claiming that surplus carbon credits would deliver us a $500 million windfall gain. But the government had their numbers wrong and the surplus has turned into a massive debt.

According to Simon Terry, Chief Executive of the Sustainability Council of New Zealand, this liability could be as high as $2.23 billion! But that is not the only blunder. He explains that instead of an estimated 10 percent reductions in emissions from the government’s programmes, there has been 0 percent. (To read the Listener article “Heat Treatment” by Simon Terry, click here>>>).

The government’s track record in climate change has turned into a debacle: the decision to sign Kyoto based on the billion dollar miscalculation, the failed ‘fart’ tax, the plan to confiscate forest owners’ private property rights and the subsequent collapse in new forest plantings (from 40,000 ha in 1999 to 6,000 ha in 2005), ineffective emission-reduction strategies, and now an obsessive commitment to uneconomic forms of electricity generation - which are guaranteed to push up power prices – while our huge potential for additional hydro-power remains untapped.

I asked Brian Leyland, this week’s NZCPR Guest Commentator, a consulting engineer specialising in the electricity sector, to share his views on the Government’s energy strategy:

“The recently released draft New Zealand Energy Strategy is dominated by the government’s conviction that climate change (more properly described as "man-made global warming") is happening and that renewable energy will save New Zealand from climate driven disaster. It fails to recognize that meeting our legitimate needs for energy is important; minimizing damage to our economy is important; and, most of all, it is important that we know exactly what it might be costing us to meet the government’s obsession with renewables. As it is, the Strategy is an expensive, misleading and futile exercise”.

He concludes: “Even if man-made carbon dioxide does cause dangerous global warming, all the effort, expenditure and economic damage that will be visited on New Zealand by the Energy Strategy will make hardly any difference to our carbon dioxide emissions, will possibly increase world-wide emissions and, most certainly, will have no effect on our climate. For all these reasons, New Zealand would be better off without a strategy than it would be with the one outlined in “Powering Our Future”. Support for it comes mostly from those who believe that economic development is incompatible with the environment, or see it as a way of making profits from carbon trading or, like Al Gore and his Generation Investment Management company push heavily subsidized renewable energy projects because, without subsidies their projects would bite the dust. Many academics see it as a bottomless source of research money and an excellent way of getting recognition, promotion and income. The government sees it as a way of reaping windfall profits from Meridian, Genesis and Mighty River Power, gaining votes and exerting more control over the economy and our lives”. To read the article click the sidebar link>>>

Of New Zealand’s greenhouse gas emissions, 49 percent come from agriculture, 23 percent from industry and households, 20 percent from transport, and 8 percent from the energy sector. Yet, even though the best policy option to reduce emissions is an economy-wide emissions tax, in order to avoid an inevitable political backlash - as the actual cost of Kyoto becomes evident - the government has chosen to take the ad hoc approach of picking winners by exempting some key sectors and subsidising others.

The Economist reports: “Green energy is fat with subsidies. America's ethanol subsidy, which has led to a huge rise in production, rocketing maize prices and consequent rioting in Mexico, is the sharpest example of why government should not pick winners: once the fertiliser and fuel used in corn production are taken into account, ethanol is probably not much greener than petrol. Europe has similarly daft subsidy regimes with equally perverse consequences—the German subsidy for solar energy, for instance, which has diverted the world's solar-cell production to sun-free Germany, thus raising the price in sunny countries where it might be usefully employed. Consumers pay for these indulgences through surcharges on electricity prices, but politicians like them”. (To read the article click here>>>)

Labour has recently announced that it is contemplating a carbon trading scheme of the sort that have been plagued by corruption and subversion overseas. As Brian Leyland comments, “When you buy "carbon credits" you are buying something that has no real substance and cannot perform any useful purpose. In most cases, the purchase of carbon credits is not associated with a real reduction in carbon emissions. The whole process is wide open to fraud and corruption because the measuring errors are huge - especially if you are buying carbon credits arising from plant growth - and also because both the buyer and the seller benefit if they bribe the auditor to exaggerate the amount that is being bought and sold. There is ample evidence of millions and millions of dollars worth of fraudulent transactions already”.

The pressure that is being applied to ordinary householders to reduce their carbon emissions - even though their contribution cannot possibly have any discernable effect on global warming - will undoubtedly give rise to a plethora of dubious ‘carbon offset’ schemes (if they haven’t already): “To cancel out the CO2 of a return flight to India, it will take one poor villager three years of pumping water by foot” (to read the Times article click here>>>).

With our climate change strategy in disarray, surely the public should be demanding that, rather than inflict significant damage to our economy, the government should pull out of Kyoto next February and align itself with Australia and the US who have taken a far more cautious and circumspect approach. Further, with APEC endorsing the nuclear option as a credible solution to the global warming “problem” - a problem that many believe may not even exist – they have clearly demonstrated the perverse consequences of policy based on poor research and junk science.


© Copyright; Foundation for Economic Growth and various authors. Individual authors retain their own copyright.

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