Tuesday, October 28, 2008
Bonkers Hippies Demand £57 Trillion
As you will have guessed by now, this time the bonkers hippies really have taken over the asylum. Despite the fact we're facing the worst recession since the Black Death, the commissars have increased - yes, increased - the sacrifice we must make to the Global Warming God. By 2050 we are now supposed to cut our carbon emissions by 80% from their 1990 level.
The cost will be catastrophic. Because - absent some miraculous and wholly unknowable technological breaktrough - the only way of hitting the target is to slash our GDP.
The TPA has now krunched the numbers. According to their calculations, even if we sustain the same progress in cutting emissions per unit of GDP as we have since 1990 (which is highly unlikely, given that reflected the one-off "dash for Putin's gas" in our power stations), by 2050 our GDP will still have to be 78% lower than otherwise to meet the new 80% target.
Tyler's back of envelope says that means a total sacrifice between now and 2050 of about £57 trillion. Yes, trillion. That's £57,000,000,000,000. Or £2.2 million for every single British household.
Don't know about you, but I reckon I'll ask for my share now. In cash. I'll take my chances on sunnier summers.
(Here's how the calc works. According to HM Treasury, current GDP is about £1.5 trillion pa, and trend output growth is 2.5% pa. So over the next 42 years to 2050 we can expect GDP to reach £4.2 trillion pa (at 2008 prices). But to cut carbon emissions to 20% of the 1990 total we need to cut another... well, bless me... another 80% of current emissions. And our carbon intensity - ie the amount of carbon we produce for each unit of GDP - is only falling by 2.6% pa, barely enough to keep pace with our trend GDP growth rate (see TPA paper). To all intents and purposes, absent that technological miracle, it means that to deliver the 80% target, we can't actually grow GDP at all. Which means we sacrifice £2.7 trillion of GDP in 2050, with correspondingly smaller amounts in all the years up to then. Call it 42 times £2.7 trillion divided by 2 equals £56.7 trillion. Yes, OK, I should do a proper spreadsheet. But just chill. Man.)