Markers Alongside the Street to The Demise of Internet Zero – Watts Up With That?


Francis Menton

What will the death of the green energy illusion look like? From time to time (see, for example, here and here) I have described a vision where some state or country runs headlong into a “green energy wall” — an impassable barricade of physical impossibility, characterized by scarcity and blackouts, into which the country crashes suddenly. Among the net zero zealot countries I have identified as the leading candidates for imminently hitting such a wall are Germany and the UK.

But perhaps, instead of a sudden crash, the demise of the green energy illusion will look more like a slow but steady decline, a gradual withering of economic activity and prosperity. In this scenario, high energy prices brought about by energy restrictions drive important industries out of business and, as good jobs disappear and energy prices increase, the people gradually and inexorably get poorer. Recent events in the UK and Germany seem to point in the direction of this type of scenario.

The latest edition of the GWPF’s Net Zero Watch Newsletter has the headline “Net Zero is dying.” (Go here and follow the link for your own copy of the newsletter. Full disclosure — I am on the board of the American affiliate of the GWPF.). Nine linked news articles from the past couple of days all deal with recent instances of industrial decline in the UK and Germany, each one a consequence of energy prices intentionally driven upward in the pursuit of “net zero.”

Several of the pieces cover the impending closure of the Port Talbot steelworks in Wales, with the loss of up to 2,500 jobs. Illustrative is a January 19 piece in the Daily Telegraph by Allison Pearson, headline “Port Talbot has been sacrificed to the angry god of net zero.” Although the Telegraph is behind paywall, the NZW Newsletter has a lengthy excerpt. Here is a part:

The high price of UK energy makes Port Talbot uncompetitive. . . . [N]et zero. That absurd and misanthropic creed . . . calls British workers losing their jobs “progress” while their carbon will now be emitted in India and China. . . . [The UK will now be] the only G7 nation with no first-class steel manufacturing – are they serious? You might almost get the impression the nation was run by a fifth column plotting its downfall.  

In another item in the current Newsletter, GWPF points to its own warnings of what was coming from 2016 and 2021. From 2016:

“As an energy-intensive manufacturer of internationally traded commodities, the steel sector is particularly sensitive to energy costs. It is the first to feel the pain of the UK’s climate policies, but it will not be the last. [Steel] and the energy-intensive sector more broadly can be regarded as a miner’s canary, giving early warning of general economic damage as the costs of climate policies are passed through from energy to all other sectors of the economy.”

And from 2021:

[T]he underlying and fundamental cause [of the ongoing closure of the steel industry in the UK] is the uncompetitiveness of all heavy industry in the UK, and for this government is itself largely to blame. GWPF has long predicted that Britain’s unilateral climate policies were making it all but impossible to operate heavy industry the UK.

Elsewhere in the Newsletter, the focus is Germany. A January 19 piece from the Times of London has the headline “What’s gone wrong with Germany?” Again it’s behind paywall; but the overall picture is a combination of self-inflicted consumer pain and equally self-inflicted industrial decline brought about by senseless mandates and high energy prices from the so-called “energy transition.” Excerpt:

The coalition has been plagued by unforced errors, typified by a hugely unpopular attempt to force homeowners to install heat pumps instead of gas or oil boilers. It has been riddled with public infighting and has presided over the worst economic performance in the G7.

That Times article does not go into detail on the industrial decline. But for some specifics consider this piece from July 13, 2023 from Politico, headline “Rust Belt on the Rhine.” Example:

Chemical giant BASF has been a pillar of German business for more than 150 years, underpinning the country’s industrial rise with a steady stream of innovation that helped make “Made in Germany” the envy of the world. But its latest moonshot — a $10 billion investment in a state-of-the-art complex the company claims will be the gold standard for sustainable production — isn’t going up in Germany. Instead, it’s being erected 9,000 kilometers away in China. . . . [BASF] is scaling back in Germany. In February, the company announced the shutdown of a fertilizer plant in its hometown of Ludwigshafen and other facilities, which led to about 2,600 job cuts. . . . [T]he company lost €130 million in Germany last year.

The explanation? From Politico:

Confronted by a toxic cocktail of high energy costs, worker shortages and reams of red tape, many of Germany’s biggest companies — from giants like Volkswagen and Siemens to a host of lesser-known, smaller ones — are experiencing a rude awakening and scrambling for greener pastures in North America and Asia. 

Politico notes that in the 15 years since the 2008/09 recession, the U.S. economy has grown by some 76%, while the German economy has grown by only 19%. Oh, that is the same period of Germany’s “Energiewende,” which has included forcing electricity prices to go to triple the U.S. level.

For the big picture of the German industrial situation, here is a chart from, showing the trend over the last 5 years:

After you eliminate the steep Covid-induced valley of 2020-21, you are left with a decline that is steady and inexorable.

Frankly, the UK and Germany would be better off hitting a hard wall, which could wake them up in time to potentially turn things around. The current situation of steady ongoing decline is inflicting damage that may well not be reversible. Even if energy prices suddenly come down in the UK by a factor of 3 or more, is anyone going to re-build Port Talbot once it has been dismantled?

Net zero may be dying, but so are the economies of the UK and Germany. I just hope that the U.S. can be rescued in time.

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