This isn’t quite the way to do it but still

More than half of the European Union’s 619 coal-fired power stations are losing money, according to a new report. As a result, the industry’s slow plans for shutdowns will lead to €22bn in losses by 2030 if the EU fulfils its pledge to tackle climate change, the report warns.

Stricter air pollution rules and higher carbon prices are set to push even more plants into unprofitability, according to the analysts Carbon Tracker, with 97% of the plants losing money by 2030. Furthermore, rapidly falling renewables costs are on track to make building new wind and solar farms cheaper than continuing to run existing coal plants by the mid 2020s.

The correct way to do this has always been to work with the capital cycle. That is, the William Nordhaus version of the carbon tax.

We want to use the things we’ve already built and paid for for as long as they still work. To scrap them before they wear out loses us what we’ve already spent.

We don’t want people to build new ones though. Therefore a low tax now, rising off into the future in a predictable manner. That way we sweat those assets we have as they fall apart but still make the transition.

No, please, leave aside all the climate change isn’t happening etc. This is purely about what should we be doing on the assumption that it is. Which is, as people should know by now, the thing that really pisses me off. Just for, and only for, the sake of argument accept that it is happening. The idiots are still doing the wrong things.

14 comments on “This isn’t quite the way to do it but still

  1. So the plants aren’t “losing money”–perhaps burning it instead of coal?–but are being forced out of business by EU eco-bullshit.

    The solution is obvious.

    No more EU.

  2. They are losing money, so why aren’t they shut down?

    Oh, because the “renewables” are only producing power when they feel like it and the German Greens closed down thereliable nuclear reactors.

  3. My understanding is that carbon dioxide production isn’t being reduced at all, the EU is simply shutting down all its industry and moving it to asia, where the carbon dioxide and jobs are now produced. So the entire thing is a giant suicide pact as far as I can tell. The usual attempt by fanatical socialists to impoverish the west.

  4. I want people to build new ones. All this climate change bollocks is really hurting people, those who work in the coal industry, those who cannot afford to heat their homes adequately and those suffering blackouts.

    Advocates of a carbon tax, coal power station closures and renewable subsidies have much to answer for, if not actual blood on their hands.

  5. Well it has caused mass redundancies in SIemens and GE so I wonder if all these people will get jobs in the “green industry” ?

    John77, as weird as it seems, Merkel came up with the idea of closing the nukes herself, without the Greens. A more irrational reaction to Fukushima is hard to fathom, especially as nearly all of them had reached their ROI point and had started making stonking profits.

  6. ‘Furthermore, rapidly falling renewables costs are on track to make building new wind and solar farms cheaper than continuing to run existing coal plants by the mid 2020s.’

    Blah. Blah. Blah.

    No one in the industry gets their guidance from the communists at Carbon Tracker.

  7. “No, please, leave aside all the climate change isn’t happening etc. This is purely about what should we be doing on the assumption that it is. Which is, as people should know by now, the thing that really pisses me off. Just for, and only for, the sake of argument accept that it is happening. The idiots are still doing the wrong things.”

    And the thing that really pisses *me* off is when otherwise sensible people think these people are idiots who doing the wrong things. They’re doing exactly the *right* things, from the point of view of their own political agenda, which is global wealth redistribution, socialist revolution, the destruction of Western industrial civilisation, and the creation of a totalitarian global government ruled by the ‘ecologically aware’ (i.e. them). They’ve made that perfectly plain.

    They’re not the ‘idiots’ here. Everyone falling for their latest imaginary hobgoblin is.

  8. Taking on board Tim’s assumption that the object of the exercise is to reduce carbon emissions, closing existing working plant is almost certainly the wrong way to go about it. How much CO2 is emitted during the production of an equivalent number of new wind turbines or solar* plants? Manufacturing concrete and steel is a rather energy-intensive process.

    Scrappage schemes are rarely a good way of reducing environmental effects. Unless you drive a Jensen Interceptor, building a new car, even if it’s a Nissan Leaf, to replace your existing one is likely to emit far more CO2 than will be saved over its remaining lifespan.

    * In northern Europe, the answer for solar is more CO2 than will be saved by their expected lifetime output.

  9. “To scrap them before they wear out loses us what we’ve already spent.” Ooooh dear, the sunk cost fallacy.

    The folly is that by closing them early you’ll have to spend early on replacing them.

  10. @Bloke no Longer in Austria, December 8, 2017 at 12:51 pm

    Merkel came up with the idea of closing the nukes herself, without the Greens. A more irrational reaction to Fukushima is hard to fathom

    It wasn’t a one-off irrational reaction, “every-one welcome” was another.

  11. ‘Furthermore, rapidly falling renewables costs are on track to make building new wind and solar farms cheaper than continuing to run existing coal plants by the mid 2020s.’

    Regardless of how cheap they become they can not provide power 24/7/365.

  12. The primary purpose of scrappage schemes is virtue signalling, e.g. St Jay Blackout Weatherill of South Australia.

  13. Dear Mr Worstall

    “The idiots are still doing the wrong things.”

    It’s what they do best. They have no idea of consequences* and when they have finally destroyed western industrial capacity and are feeling the hunger and the cold it will all be the evil capitalists’ fault, just like that nice Pres. Maduro said.

    It’s obvious.

    DP

    * or they do and they are planning the cold and the hunger, but for everyone else, not themselves.

  14. @ BnLiA
    The Greens were demanding the closure of the nuclear power stations before Fukushima. [I was agin nuclear power xtations in Japan and California because of the earthquake risk in the 60s, but *for* nuclear power stations in Europe]

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