An announcement from the Government yesterday spelled out the world’s first “greenprint” for decarbonising all modes of domestic transport by 2050.
Plans include a ban on the same of all new “polluting” road vehicles by 2040 and net zero aviation emissions by 2050. The former includes the phasing out of all petrol and diesel HGVs by 2040 – subject to consultation. Consultation will be very important because the practicality of HGVs that need to go long distances without repeated refuelling is important economically. LGVs can probably be electrified but HGVs need to use alternative fuels.
The 2050 commitment applies to aviation emissions and a consultation on that is also launched under the “Jet Zero” banner. It is clear that new technologies and aviation fuels need to be developed to achieve a major reduction in aviation emissions. Whether such changes to reach zero emissions are achievable is not at all clear and the cost, which might be very considerable, is not given.
Similarly, the costs of electrification of all rail transport is likely to be enormous as the UK lags far behind other European countries in that regard. Less than 50% of the UK rail network is currently electrified. For example the cost of electrifying the Great Western mainline to Cardiff was estimated at £2.8 billion.
The Daily Telegraph has speculated on a new system of road pricing to replace the £30 billion currently raised through taxes on petrol and diesel. But the latest Government announcement leaves out any mention of how that issue is to be tackled.
As with all good political missives, the Government document contains lots of fine words about how the environment will be improved while not inhibiting us from travelling when or where we want (for example, taking holiday flights). It’s a policy statement in essence that leaves out all the detail of how this nirvana is to be achieved and at what cost. It ignores a lot of the practical difficulties. But it’s worth reading to get an impression of what might happen in the next few years.
Where is the cost/benefit analysis that justifies this revolution in transport modes? It’s nowhere to be seen. It’s as if the Government has signed up to the global warming religion so as to save humanity while ignoring the fact that reductions in UK emissions, particularly those that are only transport related, will have very little impact on worldwide emissions. The UK generates about 1% of global emissions while transport related emissions are an even smaller proportion. The UK appears to aiming to be a saint among sinners which may make us feel good but may make us economically poor.
What are the implications for investors? It’s clear that many billions of pounds will be spent by the Government to achieve this new world. But there is one simple message to take on board. The UK will be impoverished in comparison with countries that have not become quite so committed to the new religion. So investment in China, India, even the USA, in fact anywhere except the UK and the rest of Europe, might make more sense.
Government GreenPrint Paper: https://tinyurl.com/8ymtap38
Telegraph Article on “Road Toll Confusion”: https://tinyurl.com/edxxh4rp
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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