The Week That Was (Sept 20, 2008) brought to you by SEPP


Quote of the Week:


Global warming skeptics are real party-poopers. It's so wonderful to believe that you have a mission to save the world.



“Last year Lehman Brothers released a long and highly publicized report about climate change in which they preached about decarbonization, trying to make their investors keep getting high profits from the Kyoto carbon trade scheme and the support of huge public subventions. All that, of course, with the applause of the usual choir of politicians, the entire media, and the Greens.

     A year ago they couldn't predict their bankruptcy but were predicting the climate 100 years ahead.”--  Joe d’Aleo  [see also Item #6 below]

From an e-mail letter, dated Tue, 07 Aug 2007:

“Dear Jeb, The science in the Lehman report is spectacularly wrong.  Everything else depends on this, of course.  All consequences, conclusions, and recommendations.  There  is NO evidence at all that supports manmade warming -- except some handwaving.

It seems the report authors (JL et al) have not consulted a single scientist -- certainly  not  one who is skeptical of the IPCC.  If they  had, they  would not have cited the (discredited) hockeystick as  evidence.  The latest IPCC  report no longer features it.

This is really funny:  JL writes he had lunch with Nick Stern and also with Bill Nordhaus -- both economists.  But he doesn't reveal that Nordhaus strongly criticizes Stern -- and for good reason.

 Best                     Fred
Security of energy supply must now be seen as taking priority over everything else, even climate change. UK imports of both gas and oil are accelerating, just as the fragility of supplies from Russia and the Middle East becomes more apparent and the UK heads towards the loss of one third of its generating capacity over the next 12 years. A new energy policy must be scheduled to meet the impending energy gap with an overarching long-term vision that will ensure security of supply, protect the environment, and at the same time, be deemed feasible by the engineers, financiers and utility managers who will have to implement it.  --  From the Ian Fells report about the impending UK energy crisis:


SEPP Science Editorial #4 (9/20/08)


A new paper by Ramanathan and Feng [PNAS 17 Sept 2008], using IPCC estimates of climate sensitivity, concludes that the observed increase in GH gases has already committed the world to a warming of 2.4 degC [1.4-4.3 degC] above pre-industrial values.  Any additional release of GHG would further increase the warming during the 21st century.  Even the most aggressive CO2 mitigation cannot reduce the already committed warming of 2.4 degC.  Hmm, so all the calamities envisioned by Gore et al. will come true no matter what we do.  Well not quite.  First, and most important, the increase in GHG likely has nothing to do with the observed 20th century of 0.6 degC [see NIPCC Report].  And secondly, what about the crucial threshold temperature increase of 2 degC.  Where did that come from?  I think I can shed some light on this.  An article I wrote in the Eos Forum [1997] was prompted by the claims of Swedish meteorologists Rodhe and Azar [1997] that the present level of CO2 would lead to a warming of 2 degC. And -- an obscure report by the Stockholm Environment Institute – likely a self-reference – had demonstrated that such a condition would be “dangerous to the climate system” (in the sense of Article 2 of the Global Climate Treaty).  They argued that one must reduce the CO2 concentration by reducing emissions by 60-80 percent.  But there is sufficient evidence that historic temperatures exceeded the 2 degC level without having “endangered” the climate system [Singer 1998]. 


So how did 2 degC become so widely accepted as the ‘critical’ level?  I think it’s because it is the “Goldilocks” solution: not too small, not too large, just right.  If Rodhe and Azar had picked, say 0.5 degC, as the critical level, then the climate system would be in imminent ruin, and nothing could be done.  Perhaps people who moved to the Antarctic could survive, to paraphrase Sir David King.  On the other hand, if they had picked 5.0 degC, then there would have been no need to do anything for many decades to mitigate CO2.  Apparently, enough political types thought that a 60-80 percent reduction was “reasonable” and doable.  The Stern report propagates this kind of nonsense.  That’s what makes the Ramanathan-Feng paper so poignant.  If R-F are correct and if Al Gore is correct, then the situation is hopeless and we might as well live it up. 



Azar, C., and H. Rodhe, Targets for stabilization of atmospheric CO2, Science, 276, 1818-1819, 1997.

Singer, S. F., Unknowns about climate variability render treaty targets premature Eos, Trans. AGU, 78. 584, 1997.

Singer, S.F., Reply. EOS, Trans. AGU, 79, page 188, April 14,1998



1.  White House to veto Congressional energy bill


2.  UK CEOs urge climate change action


3.  But is the UK also guilty of climate ‘vandalism’?


4.  UK's energy crisis -- the storm is about to break

5.  Planned Economic Recession – to meet carbon targets


6.  Lehman Brothers – wrong on GW


7.  How Big Business profits from GW



Two new reports:  NIPCC findings: CO2 is not a pollutant

Climate fears distort rational energy policy


The UK government wants the right to buy its way out of half its CO2 reduction targets, according to a leaked document. It says EU nations should be allowed to trade away 50% of their emissions reductions - up from the 30% currently allowed by the European Commission.


The jury verdict, acquitting the Kingnorth defendants, [TWTW Sept 13] could set a dangerous precedent for violent action against powerplants in the UK and elsewhere.  The prosecution screwed up the case.  Cross-examination would have exposed a number of serious errors in James Hansen's "expert testimony.”  To take just the quote: "If the amount of CO2 in the air were doubled, it would reduce infrared emission to space by 4 W/m2".

    The correct value is of course close to zero.  Outgoing IR emission must closely balance incoming energy from the Sun (minus the fraction reflected by clouds -- here assumed  constant) -- which has not changed.

    The real question now is legal.  What can be done?  Can E.ON be persuaded  to file a civil suit against Greenpeace for damages? 


US provides $30 million, one-third of IPCC budget (1988-2007) – plus gillions in travel, salaries etc of hundreds of US participants


Senators Lamar Alexander (R-TN) and Tom Carper (D-DE) want to reinstate the EPA’s Clean Air Interstate Rule (CAIR), recently struck down by a federal appeals court – and add CO2 to SO2 and NOx.  See


EPRI estimates (Science, 5 Sept. 2008) that by 2030 China will be emitting 4Gt of Carbon, twice the recent estimate of the IEA – and more than 50% of current global emission.


Congresswoman Marsha Blackburn has introduced a bill HR6666 to remove EPA’s authority to regulate greenhouse gases under the Clean Air Act.


Global warming: Stop worrying, start panicking?
Hans Joachim Schellnhuber, published 18 September 2008, 10.1073/pnas.

Question: Is the Proc of the Nat’l Academy of Sciences still a refereed journal?




CNN, 17 September 2008


WASHINGTON (CNN) -- The White House slammed an energy bill that the House of Representatives passed Tuesday night, calling it a waste of time.  The administration accused House Democrats of lacing the bill with "poison pills" that demonstrate a "lack of seriousness about expanding access to the vast domestic energy resources" off U.S. coasts.


President Bush and Democrats have been tangling for months over drilling offshore in an area known as the outer continental shelf, which had been placed off-limits both by Congress and executive order for decades. Bush lifted the executive order this summer as oil prices shot up and gas prices reached record levels at the pump.  He called on Congress to lift its ban but expressed "strong opposition" to the bill passed Tuesday. 


The House bill passed by a vote of 236-189. After months of resisting pressure to allow oil and gas exploration off America's coasts, the Democrats yielded and included provisions to allow more offshore drilling.  But the legislation includes a number of provisions Republicans do not like, including a repeal of tax cuts for the oil industry and a lack of incentive for states to allow drilling off their shores.


"Many of the other provisions contained in this bill are taken from other House bills that failed to pass through the Congress, or have been subject to veto threats," the Executive Office of the President said in a statement Tuesday night as the House voted on the bill, officially known as House Resolution 6899.


"If H.R. 6899 were presented to the president, his senior advisers would recommend that he veto the bill," the White House said.


Bush may never have the chance. The Senate is unlikely to take up an energy bill before next week, and it is unclear whether there is enough time left in this Congress for the two houses to hammer out a mutually acceptable compromise to send to the president.


Fifteen Republicans crossed the aisle to support the bill Tuesday. Thirteen Democrats voted against it.


The bill would allow drilling between 50 and 100 miles offshore, as opposed to the 3-mile line favored by Republicans. It would require states to give their permission for drilling off their shores. It also would include incentives for renewables, require the government to release oil from its emergency reserve and force oil companies to drill on federal areas they already lease from the government.


House Speaker Nancy Pelosi, D-California, told reporters Tuesday: "The American taxpayers have been ripped off for years on offshore drilling. This bill changes that."


Rep. Mike Pence, R-Indiana, said before the vote that the Democratic bill was "a charade," denying it would do what its backers claim.


"This is 'yes, but no drilling in Alaska, no drilling in the Eastern Gulf, no drilling inside 50 miles.' This is 'yes, but no litigation reform that will prevent radical environmental attorneys from tying up leases even before a single shovel of dirt is turned.' "



BBC News


A number of UK business leaders have called for "urgent and comprehensive" measures from the main political parties to tackle climate change.  The Prince of Wales's UK Corporate Leaders Group on Climate Change said "deep and rapid" cuts were needed in greenhouse gas emissions.  The group includes the bosses of Tesco, BAA, Shell, and energy group E.ON.


Greenpeace accused some of those involved of "hypocrisy of a previously unknown magnitude".


In a letter to the three major party leaders, the business leaders urged them not to allow fears of an economic slowdown to divert them from forging a cross-party consensus on policies to cut emissions.  They wrote: "We now urgently need cross-party effort to develop a comprehensive package of policy measures to change every major sector of the economy."  They said "incremental change" would be insufficient to deal with the threat of climate change.  Key policies would focus on:


# higher energy efficiency standards

# support for low-carbon technologies and products

# "bold new specifications" for public sector procurement

# measures to deliver a robust carbon market


Such action would benefit business by stimulating the economy and reducing costs associated with a changing climate, the group added.


Speaking on BBC's Radio 4 Today programme, Ian Cheshire, chief executive of Kingfisher, said leading retailers also had a responsibility to take action to tackle climate change.


But Greenpeace communications director Ben Stewart said: "It's astounding that E.ON would call for action on climate change when they're agitating to build Britain's first coal-fired power stations in decades.  "It makes an environmentalist's jaw drop to see the BAA logo on this letter when they're trying to expand airports across the nation."


Details of the letter come a day after a leaked document showed the UK government wants the right to buy its way out of half its CO2 reduction targets.


The government says EU nations should be allowed to trade away 50% of their emissions reductions - up from the 30% currently allowed by the European Commission.  Officials said the details needed finalising but the deal would help clean energy projects in developing countries.  Environmental groups said some of the schemes would have gone ahead anyway.


Richard North,  18 September 2008

While media attention is focused on the gathering storm of the financial meltdown (or not), many other things are happening.

One of those things is the latest bizarre (a word I am beginning to over-use; does anyone know a better one?) development in the long-running saga of the European emissions trading scheme (ETS) that arcane subject which no one really wants to talk about but which, in the fullness of time is going to cost us all (collectively) many billions.

Anyhow, pushing the story on is The Guardian which tells us that "leaked papers" show that Britain is "trying to weaken plan for EU carbon cuts."
This is a move, storms this distinctly greenie paper, which would "reduce efforts to cut domestic pollution" by which, of course, it means carbon dioxide, which isn't pollution at all, but never mind.

What this is all about is a British inspired idea (although other have had the same thought) of using carbon credits awarded to con artists entrepreneurs in the developing world who have learnt how to milk the system -- installed energy-saving technology, and thus done their bit to make money -- save the planet.

Behind all this is that monument to insanity, the ETS, which, as readers will be aware, creates carbon allowances (called EU allowances or EUAs in the trade) to auction to industry, thus giving them permission to produce carbon dioxide and thus stay in business.

Tied in with this is a plan, year on year, to reduce the number of allowances available, the theory being that this increases the cost of the allowances and thus creates a financial incentive to invest in carbon-reduction measures which, collectively, will reduce emissions and enable the EU to meet its self-imposed emission reduction targets.

That, at least, is the theory, with the major target being the electricity generation industry. And when the scheme was dreamed up, the EU was convinced that this would be achieved by moving away from burning fossil fuel -- and especially coal - and creating zillions of giant subsidy wind farms, all with "zero" emissions.

However, no one with more than two brain cells (which of course excludes most greenies) is now labouring under the impression that wind energy is going to deliver the goods. And, far from coal disappearing, if anything, usage is set to increase as pressure on gas supplies is set to make this energy source far more expensive.

This set the scene for the next fantasy option - carbon capture. Again, though no one with any brains is under any illusions that this will work, which means that we have a slight problem.

As the years progress and the carbon allowances are cut, UK plc faces the situation of having electricity generators standing idle fully tanked up and ready to go but unable to operate because their owners have run out of allocations. This, as you can imagine, would not go down too well with the great unwashed.

Hence, someone in government with a residual capacity for thinking has come up with this bright idea of buying carbon credits off the developing world, an idea which now has The Guardian whipping up its frenzy.

This would allow Europe to make less effort to cut its pollution, it says, enabling it to emit "an extra billion tonnes of CO2 from 2013-2020." The paper could have said it will also enable it to keep the lights on, but that is not the game here.

And, of course, the move has been "condemned" by the climate change industry environment campaigners, who are accusing the UK of "trying to undermine efforts to get European industry to reduce emissions."

Says that great self-publicist and self-centred little madam Caroline Lucas, MEP extraordinaire and leader of the Green party: "The British government is trying to buy its way out of climate change targets using unreliable credits from abroad. It shows how much of the political talk on climate is empty rhetoric, when you have the UK talking up the need for action on one hand, and carrying out this kind of irresponsible climate vandalism on the other."

In the very near future, however, la Lucas had better turn her attention to her beloved EU, which pays her a salary ten time more than she would get if she had to market her skills. The commission and her MEP "colleagues" are working on proposals to combine the ETS with what is called the "clean development mechanism" (CDM) run by the UN to create a global money-making empire emissions market along the same lines that the British are mooting.

Still, when "climate vandalism" gravitates to "climate crime", la Lucas can lock us up in windowless cells with no lights and we can all reduce our carbon footprints that way.  Before that, however, if would be nice if someone could actually demonstrate to this stupid woman the true meaning of vandalism, before she does any more damage.



By Roger Helmer, MEP

I've been batting on for some time about the threat to Britain's energy security which is posed by our government's over-reliance on wind (driven by EU renewables targets).  I believe that wind farms cannot be justified in either economic or environmental terms.  And I believe that even if they could, the grid cannot cope with a high proportion of unpredictably variable wind power, and that the extra cost of the necessary conventional back up (for times when the wind does not blow) would vitiate most of the proposed savings. 

Already today we are paying too much for our electricity because of the government's policy of requiring suppliers to use a proportion of vastly expensive wind energy -- while the French enjoy much lower prices from their safe and reliable fleet of nuclear power stations.

Now two major reports have come out backing exactly this view.  The first is from the Renewable Energy Foundation ("UK Renewable Subsidies"). It supports my case that the environmental benefits of wind are marginal, while the economics are downright bad; and especially the case that over-reliance on wind, and a failure to invest in mainstream base-load generating capacity, is a real threat to the survival of our economy and our way of life.

Now another report, this time from an academic, Professor Ian Fells of Newcastle University, warns that UK could lose one third of its electricity generating capacity and see "dramatic shortfalls" in power supply as early as 2012-2015, as ageing coal and nuclear power stations are set to close in the next decade. This could lead to repeated power cuts.  Fells argues that the Government has failed to develop a coherent and realistic policy to address the problem, and that current policies to reach the EU's green targets have strong elements of "wishful thinking", relying on particular renewables such as wind. He notes that the EU's targets for energy efficiency are "demonstrably unattainable".  Meeting plans for up to 7,000 offshore wind turbines by 2020 would mean installing 10 turbines every possible working day until then, ten times the best current installation rates.

Fells also argues, "It is more worrying that we have signed up to the European energy plan, which is 20% renewable energy by 2020 -- that implies about 40% renewable electricity", adding that Government figures showed that subsidies for renewables last year amounted to 1bn. "If we continue the way we are providing subsidies at the moment, that would gross at between 20bn to 30bn by 2020. This is a staggering subsidy that is being provided to keep renewable energy on the road."

We are staring into the teeth of a crisis which will be hugely more serious than Ted Heath's three-day week.  We need to change course now, and start building coal and nuclear power stations while there is still time. 

[See also ]



Posted by: Roger Pielke, Jr., Sept 9th, 2008  [Prometheus blog]

Last week's Economist provided a characterization of debates over climate change as being "alarmingly prone to zealotry and taboos." One such taboo surrounds observations that the dominant policy approach is bankrupt, which evokes a squeamish reaction among many. In a paper just out in the Philosophical Transactions of the Royal Society A (Phil. Trans. R. Soc. A doi:10.1098/rsta.2008.0138) Kevin Anderson and Alice Bows disregard taboos and squeamishness and observe that the current approach to mitigation policies focused on specific targets and timetables (i.e., 2 degC, 450 ppm) does "not, in isolation, have a scientific basis and is likely to lead to dangerously misguided policies."

This provocative paper ends by suggesting that "it is difficult to envisage anything other than a planned economic recession being compatible with stabilization at or below 650 ppmv CO2e." The squeamish will say not to talk about such things, and the analysis by Anderson and Bows ultimately may not stand up to close scrutiny (though its analysis is quite consistent with Pielke, Wigley, and Green's "Dangerous Assumptions"). On the other hand, others will laugh at the notion of "planned economic recession" and say we should just give up the idea of decarbonization. Both reactions would be wrong - the continuing comprehensive failure of mitigation policies, and its consequences, should be the subject of serious discussion, especially the introduction of radically new options beyond those that have yielded little progress over the past few decades.

Here is an excerpt from the paper, but do read the whole analysis for the basis for the following conclusions: “It is increasingly unlikely that an early and explicit global climate change agreement or collective ad hoc national mitigation policies will deliver the urgent and dramatic reversal in emission trends necessary for stabilization at 450 ppmv CO2e. Similarly, the mainstream climate change agenda is far removed from the rates of mitigation necessary to stabilize at 550 ppmv CO2e. Given the reluctance, at virtually all levels, to openly engage with the unprecedented scale of both current emissions and their associated growth rates, even an optimistic interpretation of the current framing of climate change implies that stabilization much below 650 ppmv CO2e is improbable.

“The analysis presented within this paper suggests that the rhetoric of 2 C is subverting a meaningful, open and empirically informed dialogue on climate change. While it may be argued that 2 C provides a reasonable guide to the appropriate scale of mitigation, it is a dangerously misleading basis for informing the adaptation agenda. In the absence of an almost immediate step change in mitigation (away from the current trend of 3% annual emission growth), adaptation would be much better guided by stabilization at 650 ppmv CO2e (i.e. approx. 4 C).

“However, even this level of stabilization assumes rapid success in curtailing deforestation, an early reversal of current trends in non-CO2 greenhouse gas emissions, and urgent decarbonization of the global energy system. Finally, the quantitative conclusions developed here are based on a global analysis. If, during the next two decades, transition economies, such as China, India and Brazil, and newly industrializing nations across Africa and elsewhere are not to have their economic growth stifled, their emissions of CO2e will inevitably rise.

“Given any meaningful global emission caps, the implications of this for the industrialized nations are bleak. Even atmospheric stabilization at 650 ppmv CO2e demands the majority of OECD nations begin to make draconian emission reductions within a decade. Such a situation is unprecedented for economically prosperous nations. Unless economic growth can be reconciled with unprecedented rates of decarbonization (in excess of 6% per year), it is difficult to envisage anything other than a planned economic recession being compatible with stabilization at or below 650 ppmv CO2e. Ultimately, the latest scientific understanding of climate change allied with current emission trends and a commitment to 'limiting average global temperature increases to below 4 C above pre-industrial levels', demands a radical reframing of both the climate change agenda, and the economic characterization of contemporary society.

“In the absence of global agreement on a metric for delineating dangerous from acceptable climate change, 2 degC has, almost by default, emerged as the principal focus of international and national policy. Moreover, within the scientific community, 2 C has come to provide a benchmark temperature against which to consider atmospheric concentrations of greenhouse gases and emission reduction profiles. While it is legitimate to question whether temperature is an appropriate metric for representing climate change and, if it is, whether 28C is the appropriate temperature (Tol 2007), this is not the purpose of this paper.”



16 September 2008


Al Gore's carbon trading business GIM was banked with Lehman Bros. It will be interesting to see how this will play in the future but I suspect that this increases the risk of participating in Carbon trading.


Last year Lehman Brothers released a long and highly publicized report about climate change in which they preached about decarbonization, trying to make their investors keep getting high profits from the Kyoto carbon trade scheme and the support of huge public subventions. All that, of course, with the applause of the usual choir of politicians, the entire media, and the Greens.


A year ago they couldn't predict their bankruptcy but were predicting the climate 100 years ahead. Thousands of green militants have been using the Lehman report as a proof of global warming and impending chaos. Lehman Bros said it! sacred words! Its scientific advisor is James Hansen! The report is the basis for policies on climate change in Spain, Argentina and several other countries playing the progress game; it is used by economy professors playing climatologists; by newspapers editorials, and even by a State Secretary: Lehman Bros, said it!


Lehman Bros spoke in its report about the climate in 2100 and its economic and financial projections, about climate change costs several decades away. They dared to recommend to their investors what they considered a central value of the carbon ton in 50 years from now. Their sources and support references were taken from the IPCC AR4, AR3, and so on. Really impressive.


But even with their high ability to peek into the future, they couldn't predict their demise one year ahead though there were many people that had been warning about this present crash for years. But Lehman Bros were recommending investments 30, 50, 100 years ahead. Some days, reality imitates fiction. Who was Lehman Bros' 'scientific' adviser on climate? You guessed it, James Hansen, the same guy that wants to drive the world to bankruptcy as he did with Lehman's Bros.


But the story has some connections with Hansen being the 'scientific' adviser to Al Gore, who's the Chairman of the Board of the Alliance for Climate Protection. As seen in Alliance's website

 the managing Director is none less than: Theodore Roosevelt IV.


Theodore Roosevelt IV is Managing Director at Lehman Brothers and a member of the Firm's senior client coverage group, which oversees the Firms client and customer relationships. Mr. Roosevelt is an active conservationist. He is Chair of the Pew Center for Global Climate Change, Vice Chair of the Wilderness Society, and a Trustee for the American Museum of Natural History, The World Resources Institute, the Institute for Environment and Natural Resources at the University of Wyoming, and a Trustee of Trout Unlimited.


The Lehman reports in two parts can be found on this site 'Intellectual Capital'

  In "The Business of Climate Change ll", the following acknowledgement is made: "On the scientific side, we are grateful to Dr. James Hansen, Director of the NASA Goddard Institute for Space Studies, who, at the end of a particularly informative dinner hosted by Ben Cotton of the Man Group, gave generously of his time to clear up a number of scientific questions that had been niggling us. Dr. Peter Collins and Richard Heap of the Royal Society provided valuable input and brought us up to date on the more controversial areas of scientific developments in the domain of global climate change."


Lehman's failure provides a preview of our future if more companies bank their future on the speculative advice of these advocacy scientists, politicians and environmental groups, while ignoring short-term realities.




By Richard North


The Lehman crash opens wide a vein of which we had begun to explore with our examination of carbon capture

 It may be obvious when you think about it, and start doing some digging, but it has not been to forefront of the debate - the simple precept that one of the main beneficiaries of "climate change" is big business.


To that extent, simply to position the climate change issue as greenie propaganda is to miss the point. Green politics itself is a money-spinner, which makes the green-agenda advocates beneficiaries in their own right. Big government, and especially the tranzis like the European Union and the United Nations gain considerably, as indeed do national governments, which are able to expand their tax bases with rafts of green taxes.


Now put big business into the mix and you have a potent cocktail - a triumvirate of vested interest which needs to stoke up public concern about "climate change" in order to reap the financial and political rewards. The big myth in all this, of course, is that the "greenies" and industry are on opposing sides. They are in fact allies (some unwittingly), each standing to benefit in their own ways, alongside their allies in the various levels of government.


Arguably, this is - if one dare use that term - a vast conspiracy of interest, a means by which this triumvirate has found the golden key which enables it to pick the pockets of ordinary people. That turnkey, of course, is the quest to "save the planet", for which no impost or sacrifice is too great to demand.


Focusing on the big business dimension, the benefits of "climate change" are stunningly obvious - but only when you put the pieces together in what emerges as a classic "Baptist and bootlegger” alliance


At the heart of the scam is, in European terms, the European emissions trading scheme (ETS)

 Elsewhere, in the USA and Australia, for instance, it is "cap and trade". What this does is put a notional value on an otherwise valueless waste produce, carbon dioxide -- legitimised by the extraordinary sleight of hand which has turned this harmless chemical into a threat to our very existence.


It is in the electricity generation industry, however, that the nature of the scam is most easily seen. This industry is a particularly valuable target for two reasons. Firstly, unlike most manufacturing industries, it cannot move offshore if costs are loaded onto it. Secondly, it has a very large and captive consumer base which needs the product and cannot easily find a substitute.


Now, the way the scam works is as follows. Through the ETS/cap and trade scheme, a "tax" is applied to the industry, in the form of a government-mandated price increase based on the tonnage of carbon dioxide produced. That is the genius of this "tax" -- disguised as a price increase; it can be passed straight down to the consumer.


Also, unlike other taxes, the industry is given a choice. If it prefers, it can produce the carbon dioxide, collect the tax from its customers and pay it to the government. On the other hand, it can decide not to produce the carbon dioxide and keep the cash which it has collected from its customers. That is where carbon capture comes in.


At first sight, any requirement for carbon capture is a huge impost on industry but it is quite the reverse, as long as the customers' bank accounts can be raided to pay for the costs. Rather than pay the money over to government -- which is the plan under phase II of ETS and the intent of cap and trade - the industry can instead "invest" it in the capital plant required for carbon capture.


Not only does this have tax benefits (maximising capital allowance), it increases the asset value of the generators, which goes straight on the balance sheet. Further, with increased operating costs, constant margins -- at the levels permitted by the regulators -- actually yield considerably more cash in absolute terms.


Putting figures on this, the wholesale value of electricity generated in the UK (2007) data

 is approximately £32 billion at current prices. Assuming that remains static and, in phase II of ETS, carbon fetches about £35 per metric ton (one of the lower estimates) that adds £7-8 billion a year to the cost of electricity production. Siphoned off into asset building (carbon capture plant), that finances an increase in the asset base of something like £80 billion. In other words, this particular response to "climate change" adds that amount of value to the industry.


Nor indeed does it stop there. The other side of the equation is the drive towards renewables, which we have estimated

  will add another £6 billion to electricity prices through the ROC. The industry's turnover thus increases by about £14 billion, a cool 42 percent in one hit.


That is where the attraction lies. In a mature industry like electricity generation, with near 100 percent penetration, opportunities for growth are extremely limited, especially when the drive is towards increasing energy efficiency. The opportunity to increase turnover by 42 percent or thereabouts is a massive business opportunity which no industry could afford to turn away.


All this, of course, relies on keeping the population in a state of fear, convinced that "climate change" is a real and serious threat. Small wonder, therefore, when you look behind the climate change propaganda, the energy companies rather than the greenies are the major pushers.


That is the way it will stay until the bulk of the population wakes up to the realisation that "climate change" is one huge scam calculated to raid their wallets and enrich the owners and shareholders of their electricity providers.


And that is where the political battle lies. So far, the cost of "climate change" has not impacted heavily or obviously on the population. But, as the imposts multiply and become ever-visible, resistance will grow. Those who think the political battle over climate change is finished are wrong. It is only just starting.