It is the revival of British energy independence; it is the end of British climate policy. It is salvation for UK householders; it is ruin for the climate. Of course, Prime Minister Rishi Sunak’s support for new oil and gas projects is none of these things – and burning off the hyperbole is essential to a sensible energy and environmental policy.
Last Monday, the British government announced that hundreds of new licences would be offered for oil and gas exploration and development in the waters around the country. It also confirmed the choice of two new carbon capture and storage hubs.
They promoted this policy on the grounds that it would improve the UK’s energy security, reduce imports, and lower the carbon footprint instead of relying on higher-carbon imported fuels.
Yet the government’s “windfall tax” remains in place despite oil prices now having fallen to historically average levels. And the carbon capture plans, although welcome, remain unfunded, the perennial failing of British government policy for a crucial technology.
Mr Sunak’s Conservatives are well behind in the polls to the centre-left Labour Party, and face an election by January 2025 at the latest. Labour has promised to block new oil and gas licences if it wins power, but not to rescind existing ones.
After narrowly holding on in a by-election for former Prime Minister Boris Johnson’s old constituency, the Conservatives sense an opportunity to paint Labour as environmental extremists.
Their win in Uxbridge and South Ruislip was credited, or blamed, on the plans of London mayor Sadiq Khan, from the Labour Party, to extend the capital’s Ultra-Low Emission Zone for road vehicles to outlying boroughs. This would require users of older, polluting vehicles to pay significant fees.
Current net-zero minister Grant Shapps said that Labour’s was a “Just Stop Oil plan”, after the activists who have disrupted numerous sporting events this summer, and apparently glued themselves to a cooking oil tanker last year.
This desperate ploy to make climate a left-right culture war issue would be disastrous. Europe’s energy and environmental policies have been muddle-headed to say the least, but they have delivered progress while mainly steering clear of the US right wing’s global warming denialism.
The UK has decarbonised faster than any other major economy, helped by a substantial carbon tax, the near-elimination of coal and offshore wind power. But former prime minister David Cameron’s 2013 decision to set aside parts of the green agenda stalled refurbishing houses, blocked onshore wind, stopped solar incentives, froze fuel taxes and cancelled £1 billion for carbon capture.
This U-turn cost Britons billions for energy during last year’s Moscow-inspired gas crisis. Unfortunately, the government has not learnt the lesson. A promise to relax bans on new onshore wind has made no real progress. Mr Sunak and prominent minister Michael Gove have signalled they could backtrack on heat pumps and other policies that appear costly for consumers.
Yet environmentalists’ arguments against the new hydrocarbon licences are also incoherent. They say there is relatively little oil and gas remaining to be produced in the North Sea, which is probably true, but that producing it instead of relying on imports would somehow be disastrous for the climate.
While acknowledging that UK oil and gas production has little impact on global prices, they argue that this extra British extraction will somehow result in much higher global consumption. But the amounts are minor, both in energy and in climate terms.
The fields that could be developed in the near future amount to less than three years of British oil consumption and barely a year of gas.
The environmental movement remains trapped in the early 2000s “peak oil” paradigm, where there is a limited amount of petroleum underground, which will inevitably be extracted if found, instead of the clear situation today where improvements in non-fossil energy systems mean hundreds of billions of barrels will be left untapped around the world at the end of the oil age. It’s just a question of where those unused barrels will be.
Because of this, the shortfall in domestic production will be met, directly or indirectly given the global marketplace, from British allies such as the UAE or the US, but also from adversaries and major polluters including Russia and Iran.
It is the height of hypocrisy to accept burning some oil and gas but to refuse to produce it at home, instead buying it from countries with poor environmental and human rights standards.
They present the energy transition as a zero-sum game, a binary choice between jobs and investment in offshore oil and gas, or in renewable energy. Of course, the two are compatible – indeed, even complementary.
UK oil and gas doesn’t reduce household bills directly, but it pays sizeable taxes - £2.6 billion ($3.31 billion) in the 2021/22 fiscal year – crucial at a time of soaring government debt.
Environmentalists are foolish to walk into a trap laid by climate deniers and those who are wobbling on net-zero aims. Unlike Just Stop Oil, the Insulate Britain protests, which started in September 2021 with motorway blockades, had a constructive aim.
Progress towards net-zero carbon by 2050 will not be determined by a little more or less North Sea output, but by how quickly the UK insulates its leaky houses, builds solar, wind and nuclear power plants, fits carbon capture to its industries, and scraps petrol and diesel cars in favour of electric vehicles.
But that means people being aware of the climate consequences of their lifestyles. That is far less comfortable than supposing the global warming problem will go away if evil oil companies are driven out of the UK. Pro-climate groups, unfortunately, too often favour easy campaigns and fund-raising over educating their supporters on tough choices.
Governments and environmental groups must get ahead of the public debate. They need to promote a coherent combination of all the cleaner, cheaper, better alternatives to carbon-emitting fuels. Fighting one small oilfield at a time burns money and public goodwill, to heat the Earth.
Robin M. Mills is CEO of Qamar Energy, and author of The Myth of the Oil Crisis