Politics is intrinsic to energy because without government price guarantees, subsidies and grants, there will simply be inadequate investment. Or there could be huge concentrations in capacity that could suddenly be unprofitable.
We could say exactly the same thing about food, telecoms or jet engines. And we do have a way of dealing with these things as well. Known as a “market”.
But that wouldn’t offer Willy a sinecure from which to pontificate, would it?
Hutton continues to demonstrate how hard it is to attract anyone worthwhile to an Oxbridge college mastership.
“Or there could be huge concentrations in capacity that could suddenly be unprofitable.”
How huge an investment has been made in unprofitable windfarms, solar panels, and biological fuels because of governmental intervention? One might add that the forms of nuclear plant adopted have been restricted to those producing material for atomic bombs, not necessaarily those best for power generation, again because of government intervention.
Government ensures massive investment in the wrong things.
All that government needs to do is to ensure that contracts are adhered to- by means of supplying law courts and an equitablle body of law not prone to unforseeable changes.
Still got half-a-dozen brand new unused airports for sale in Spain.
Sports centres, even the housing boom was with politically cheapened money.
And if I build a gas-powered generating plant and I go bust, what’s the problem? I risk and win or lose. I am bright and will try to take the right decisions. Almost certainly better than ‘ur Willy at the centre of things.
I’m fairly certain oil companies don’t invest billions in a climate of price guarantees, subsidies, and grants from the government. Tax breaks maybe, but they’re quite different.
A huge example of this is shale gas in the US – massive overinvestment by companies has lead to excess gas on the market and a collapse in prices for millions of end-users. The people who’ve lost out are the shareholders and management of those companies – good, they too the risk, they failed and millions have benefited as a result. What IS that numpty Hutton’s problem with that?
No, Hutton is right. Only the government can absolutely guarantee inadequate and malinvestment, and a certainty of undersupply of consumer goods and services. Markets cannot consistently supply these boons of central planning.
Politics is intrinsic to subsidy, not to any particular class of goods (to which it becomes attached once a subsidy is suggested).
Politics is intrinsic to inefficient generation of energy because without government price guarantees, subsidies and grants, there will simply be inadequate investment.
Fixed.
Surely the problem is the other way round.
The reason the lights are quite likely to go out in the next ten years is because government regulation has made most normal technologies for generating electricity (I.e. burning stuff) non-profitable. Ergo, nobody wants to build power stations!
If they hadn’t regulated to close all the coal fired plants down early, if they didn’t let the nimbys stop anyone building anything, if the idiots in H.M. Opposition didn’t keep threatening price fixing when it’s their turn…etc etc we wouldn’t have a problem getting companies to invest in supplying us with electricity.
I like how he justifies further political interference as needed because of the *original* political interference.
Politics is intrinsic to newspaper columns because without government price guarantees, subsidies and grants, there will simply be inadequate investment. Or there could be huge concentrations in capacity that could suddenly be unprofitable.
Quite.