28 Jan 2013

HS2 v The Green Deal

It does seem extraordinarily ironic that the government should choose today to launch the Green Deal and simultaneously announce more news on the HS2 routes from Birmingham to Manchester and Leeds. There's no doubt which project will draw the headlines. HS2 is expensive, futuristic and sexy, if you like train sets. The Green Deal is a cinderella story in comparison, all about replacing boilers and stuffing insulation into lofts.

But what boggles me is that whilst preaching austerity to all and sundry, the government still sees fit to fork out £32billion on HS2 as an "engine of growth." There will also be a very generous compensation scheme, all paid for by us, the taxpayer. Yet the business case for HS2 is very weak, almost everybody agrees. If the business case was stronger, then no doubt it would suck in private money. But no, there is no private money involved at all, not even via the Private Finance Initiative. This is plain vanilla government spending.

Contrast it to what is happening with our energy infrastructure. Everyone agrees that it needs tonnes of money spent on it because what we have is knackered. Even those who think global warming is a tissue of lies and decry our carbon reduction commitments have to admit that we need shed loads of new power stations just to stand still and keep the lights on. Is the government seeing fit to throw £32billion at the problem? No way. The Green Deal is arguably much more important than HS2, but it's funded by the end user by way of a loan, topped up if they are lucky with a little with help from surcharges on other peoples' energy bills.

Next time you hear someone say that we can't afford to decarbonise the grid because it's "too expensive", just ask compared to what? HS2?


  1. Yes indeed, but they had to stimulate borrowing some how. I wonder if the old "you may lose your home if you fail to pay" clause will appear on GD paperwork.

    Odd that a number of social landlords have pulled out of the scheme too, rumour has it they are not going to allow their tenants apply.......

  2. I agree and while I'm a big fan of trains, there are so many projects you could do with a fraction of that £32 Bn which have very high prospects to deliver returns. In fact there are probably rail schemes waiting for funding with a higher expected ROI...

    I don't understand the rationale behind funding decisions. Maybe it's part of the chancellor's plans. Maybe it is the only thing that the Lib Dems would support.

  3. I am quite worried about the chancellor's hidden agenda. From what we know it seems designed to ensure that all the cuddly & green things Cameron said remain as just words. Osborne's actions are not explained by simply 'wanting to cut the deficit' as this scheme (and the lack of a plan for growth) demonstrate.

    We didn't vote for Osborne's agenda, we don't even know exactly what it is, and his protestations of just trying to cut the deficit are disingenuous.

    Sorry if this is too political but I saw your last post and thought this is probably OK.

  4. Don't worry about being too political. This blog never set out to be about energy politics but that is what it is turning out to be, because it's what agitates me most. And I think you are right to point out the Chancellor's hidden agenda. £32billion pounds equates to around £1200 per household. Why aren't the Mail and the Telegraph hammering this point home? Why always the £200-odd quid per household on energy surcharges (which will just happen to stabilise household fuel bills for all time). At least the energy surcharges will benefit everyone. What good is HS2 if you live in Cornwall? Or Bristol? Or Norwich? Or Hull? Or Liverpool?