Fears that Rishi Sunak’s recent watering down of green targets will economically harm the U.K. are unfounded, says Ross Clark in the Telegraph. “If anything, it will do the opposite.” He writes:
Mark Carney did enough damage as Governor of the Bank of England, keeping the economy pumped up on quantitative-easing and ultra-low interest rates for so long that we are now suffering the inevitable consequences as the monetary policy under his leadership is unwound. But at least he isn’t my financial adviser.
Readers may just remember his speech to Lloyds of London in 2015 when he warned that investors exposed to fossil fuels faced potentially “huge” losses as coal, oil and gas assets became stranded. In fact, oil and gas shares have been one of the few ways to preserve your wealth over the past couple of years as much else – including Government bonds issued in Carney’s day – have crashed around them.
But it hasn’t stopped the former Governor from trying to tell Rishi Sunak that he has made a dreadful mistake in slightly relaxing some targets to ban electric cars and gas boilers and in granting new licences for North Sea oil and gas extraction. Apparently, in Carney’s world, it is going to harm inward investment into the U.K., as companies start tut-tutting at the Government’s backsliding on Net Zero. “What I find when speaking to companies is their first question is: am I getting clean power?”
He didn’t specify which companies these are, but I guess they don’t include, for example, German industrials giant BASF which has wound down some operations in Europe because of high energy prices and instead invested £10 billion in China. Nor, I would guess, does it include steel companies which similarly are being driven abroad by high energy costs, carbon levies and so on. Nor, surely, can it include Norwegian state oil company Equinor, which would not be investing in Britain had it not been allowed to develop the Rosebank oil field.
Worth reading in full.