Have you ever wondered how I came to write this? If not, the good news is that it might be a little relevant to the economic and energy crisis we face today…
My grandmother was an NHS nurse. This made her so sceptical about… various things… that she refused to take Thalidomide. Unlike the effects of Thalidomide, the scepticism was passed on to my father.
Meanwhile, my grandfather made several innovations in the world of greyhound racing, which included swimming his dogs to train them without injuring them. It worked and at my grandmother’s funeral they played a video of a national race which my grandfather’s lightweight dog won from miles behind thanks to her aerobic endurance.
What they didn’t show at the funeral was a trophy picture of my grandmother and the dog, which ended up on the back page of a newspaper under the headline “Hubble’s Bitch Wins Wembley”.
My father, meanwhile, went on to win Olympic silver and Commonwealth gold in the pool. He did so by combining scepticism and innovation, which included becoming the first to exploit a loophole in the rules which allowed a butterfly kick to be performed off the dive for other strokes.
By the time the UK’s swimming authorities had banned the outrageous practice, it had caught on and every swimmer does it today. It worked so well they limited how far you’re allowed to go under the water.
Years later, my dad took his scepticism and interest in innovation to dietary advice and began reading about Dr. Atkins of the Atkins diet. At the time, he was the pariah of dietary science, which only made my dad more willing to listen given his family’s experiences with scepticism, innovation and challenging the establishment.
The New York Times wrote in 2002 about how things played out…
If the members of the American medical establishment were to have a collective find-yourself-standing-naked-in-Times-Square-type nightmare, this might be it. They spend 30 years ridiculing Robert Atkins, author of the phenomenally-best-selling ”Dr. Atkins’ Diet Revolution” and ”Dr. Atkins’ New Diet Revolution,” accusing the Manhattan doctor of quackery and fraud, only to discover that the unrepentant Atkins was right all along. Or maybe it’s this: they find that their very own dietary recommendations — eat less fat and more carbohydrates — are the cause of the rampaging epidemic of obesity in America. Or, just possibly this: they find out both of the above are true.
Atkins was even hauled in front of Congress to defend his positions, after they had been labelled dangerous.
The company that publishes Fortune & Freedom today is part of the group that includes the company willing to publish Dr. Atkins back then, when he was ridiculed and considered unscientific. And my father began to read their financial work too. He sent me articles over the years and I became hooked.
So, there you have my story. What’s it to do with you?
Well, the world is pursuing the economic Atkins diet – decarbonisation. And I can’t help but be sceptical…
What if we’ve got it all wrong?
What if the climate change establishment has it just as backwards as the medical establishment did with Dr Atkins? After all, the human diet is probably a lot simpler to figure out than climate change.
Of course, I haven’t got a clue who has it right on either count. And when it comes to science, nothing is ever figured out. The science is never settled. It always keeps evolving.
The real issue is the one that the New York Times has pointed out. When government policy based on the fashionable science ends up causing problems such as the obesity epidemic, not to mention Thalidomide.
Indeed, right now, government policy on rolling out the renewable energy boom seems to be triggering a pretty spectacular resurgence in coal, of all things… Not to mention diesel trains – thank God we still have some.
Meanwhile, nuclear was abandoned after a terrible meltdown in Japan killed… zero people. Although one did pass away years later from radiation.
Now, how many people will die of high energy prices this winter?
Sure enough, nuclear is now back on the menu, big time. Japan and the UK are leading the way.
At the heart of what has gone wrong is a classic government mistake. They’ve declared the likes of wind and solar viable, without considering the full system. For example, you can’t just roll out wind and solar on the scale we have without first securing sufficient battery infrastructure. That’s the lesson we’re learning today, the hard way.
Alternatively, you need baseload power which is green, hence the need for nuclear.
It’s the wind energy investors who are learning this the hard way. Negative electricity prices and ridiculously cheap energy prices from wind and solar are being cheered as good. But who’s going to invest in that?
Indeed, because wind and solar are so cheap at the margin, an entirely new pricing system could have to be developed to account for the intermittency.
Meanwhile, the government’s price caps have caused havoc for electricity retailers.
What happens when you try to transition an energy system too quickly? Exactly what you’re seeing today – chaos.
And the chaos isn’t confined to the renewables sphere. Their chosen back-up power is struggling badly too.
It turns out that energy markets and producers don’t want to wait for the wind to stop blowing or the sun to stop shining before they start burning gas and making money. Unless, of course, they’re compensated with very high prices. And so gas prices have done the predictable – soared.
But even here, governments are wreaking havoc.
The Dutch rejected bringing their Groningen gas production back online, having shut it because of their desire to meet their country’s emissions goals. As a result, the largest greenhouses in Europe have gone dark.
It takes up to 3 billion cubic metres of natural gas a year to keep the Paris-sized 10,000 hectares of greenhouse food and flower growing space in the Netherlands heated. But that’s now unaffordable thanks to soaring European gas prices, putting €9.2 billion of exports at risk.
I wonder what that’ll do to food prices, which are already near decade highs…
The UK has woken up and has decided on a different course of action. Two gas projects began production in recent weeks and two more are expected in the next few months. As they say in commodity markets, “the cure for higher prices is higher prices,” because it incentivises supply.
But governments can of course make a big enough mess of things to require a dangerously large price spike before supply comes online…
As Nigel keeps telling subscribers, the green energy boom has become a transfer payment from the poor to the rich.
That’s not all he’s been saying though. Check out his latest project here…
Editor, Fortune & Freedom