Speech, Reul report, Oct 22nd 2007

Below is a speech I gave in Plenary in Strasbourg last night that I thought you would appreciate reading

Mr. President,

There is much to commend in this report.  Of course it makes the ritual genuflection to climate change hysteria, despite increasing doubts about the supposed link between CO2 and climate.  But it also recognises the importance of diversifying energy supplies, and of using fossil fuels, including coal, in the energy mix.

It emphasises the need for energy security, and in this context, it rightly points to the need for energy efficiency, for continuing use of domestic resources including coal, and for nuclear energy, both the current use of fission, and the vital research on fusion, which is a great hope for the future.

Mr President, the most remarkable factor in the energy debate is the way that the Greens and their fellow-travellers agonise over carbon emissions, yet set their faces against the only mainstream low-carbon generating technology.  With oil at $90 a barrel, it is time to recognise that nuclear is the cheapest, safest, cleanest, most sustainable and predictable mainstream base-load generating technology available.

And as my colleague Alejo Vidal-Quadras has said, “Nuclear waste disposal is a technical problem which has been solved”.

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14 Responses to Speech, Reul report, Oct 22nd 2007

  1. Malcolm Edward says:

    Well said.
    Nuclear fission is of course essential for the next generation of power stations to supply the guarunteed base load securely and at a predictable cost.
    I wam pleased to see you mention nuclear fusion which has tremendous potential and has not always had the political and financial commitment that it deserves.
    Also Nuclear Fusion has the advantage that it will really upset the greenies as it is none of the things they like to complain about (though I’m sure that won’t stop the greenies from moaning).

  2. Ryan Lavelle says:

    Roger

    On the subject of the indispensable nature of nuclear power, regardless of the “carbon footprint” hysteria, we are in total agreement.

    The economics however are complicated, and I do not trust the laissez-faire model to deliver our future energy requirements for such a large scale, capital intensive mode of investment.

    We need public credit for such a massive, decades long project to bring the worldwide nuclear renaissance to the UK.

  3. Ryan Lavelle says:

    I should add that public credit is illegal under Maastricht, and that is the primary reason why we should leave the EU immediately, before we are locked into an economic system that will doom us all to “micro finance” and similar idiocies that are being proposed by well meaning sorts for the “developing world”.

  4. Derek Tipp says:

    I agree with Ryan Lavelle, above. We must retain independence over our energy.

  5. Roger Helmer says:

    Thank you for these comments. But the very successful Olkiluoto nuclear plant which I recently visited in Finland was entirely financed by the private sector — a consortium of energy-intensive businesses. It is now delivering electricity to the shareholders very much cheaper than external sources, even after costing-in waste disposal and eventual decommissioning.

    The one thing that operators have a right to demand from government on these very long-term investments (60 years plus) is that there will not be unforeseen regulatory changes which would undermine their business model over time.

  6. Ryan Lavelle says:

    Agreed. This is a good example of where the private sector has got it right (for now), but what guarantees to the Finnish public have that the consortium will continue to run the plant and sell electricity at a fair price to the grid?

    If the market is regulated and price controls in place, then that is perfectly fine, however, as I said before, in pure Laissez-Faire, the “energy markets” will determine the cost of power and a large percentage of the price is driven by financial speculation and not supply/demand dynamics.

    A case in point was Enron, and we all know where that led to.

  7. Roger Helmer says:

    I’m sorry to disagree; Ryan, but price regulation is the last thing we want! Just go back to a Soviet department store twenty years ago! In fact Olkiluoto is owned by a consortium of energy-intensive companies, so they don’t sell to the grid at all — they just get their own electricity at about half the price of their competitors! If you don’t like that, don’t ask for regulation. Just build more nuclear capacity.

  8. Ryan Lavelle says:

    Roger

    We now have $94 and rising price of a barrel of oil thanks to the “free market” in oil, when the physical cost of producing it is ~$23. This is the biggest tax on the global economy in world history.

    I am talking about the abuse of commodity markets by the financial system, not soviet style price controls.

    I should add that I work in the financial industry, so I have a pretty good handle on this issue.

  9. Roger Helmer says:

    I respect your comments, Ryan, but the value of any commodity is what you or I are prepared to pay for it, and a simple “cost-plus” calculation is irrelevant. It is perfectly natural that scarcity, real or perceived, would drive up prices far beyond production cost. If markets were working well, the high price of oil would drive new investment in alternative energy like nuclear. It is excessive regulation that delays that outcome. So we need not MORE regulation, but less!

  10. Ryan Lavelle says:

    Roger

    Likewise, I respect our difference of opinion on this matter, but it is a very serious one.

    Unfortunately, in the area of national energy, allowing market forces to control the economics has been proven in every case to result in profit gouging and abuse by the financial interests who are taking over these sectors, all at the expense of the most vulnerable sectors of society – the poor, the elderly and the sick.

    In the broader economy, the biggest promoters of free markets have always been the largest and most pernicious monopolies in world history. Lets take a look at some of the worst abusers today – Monstano, Dupont, Debeers, Royal Dutch Shell. You name it, in every case, they all promote free trade.

    Seriously, do you really believe that allowing an Australian hedge fund to operate our water infrastruture in London will result in a better deal for consumers?

    Surely, this paradox is the achilles heel of those who promote universal free trade?

  11. If Global CO2 was measured as a 100 Story Building, human production would amount to just the thickness of the Linoleum on te Bootom Floor.
    Find out the Percentage of CO 2 in our atmosphere.
    It is a Tax scam.
    Suggest to the EU instead that rather than pay taxes, each Person should, on their fith Birthday arrange with their church a local tree planting ceremony with their close friends and family.
    According to the Woodland trus, each tree Produces enough Oxygen to support two People during theor lives, AND soaks up Carbon from the atmosphere…
    Do you think the EU Beaurocrats will adopt this will advocate this.

  12. Far better to let Companies live or die by their innovation and competitiveness than to be forced to adopt policies by beaurocracts who have no knowledge of the subject.

  13. Yes, Ryan, I do believe that markets allocate resources in an optimal way, or as close to optimal as we can get. The Hedge Fund would have bought the business because it thought it could manage it better than the previous owvners. If it fails to do so, the value will go down, someone else will buy it, and try to do better. I can only assume you’d prefer to nationalise it. We all know where that leads. It may seem that benevolent dictatorship is the best and most rational form of government, but our experience is all against it. I suggest you read Adam Smith and Ricardo!

  14. Ryan Lavelle says:

    But Roger, Adam Smith wrote the Wealth of Nations for the British East India Company – the greatest corporate/military monopoly in world history.

    Free trade leads to the kind of corporate/collectivist cartel systems that you say you are against!

    I believe that 50% of a national political economy should be run by the state, and most emphatically that should be the energy, transport, health and education sectors.

    The rest should be run by private enterprise in a regulated fashion to ensure that the free markets you talk about actually exist for the small entrepreneur to operate in.

    Global free trade is imperial economics, and empires are never democratic.

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