Everything for the transition

Ultra-long read featuring lots of quotes

Note: I will be removing the paywall from this post a week from now. The reason I didn’t make it free to begin with is that I strongly believe paying subscribers have literally earned the privilege to be horrified and infuriated before everyone else here. Also, I got a headache writing it.

Twice in recent stories I’ve referenced a paper produced by the Bruegel think-tank, with a promise to look into it in more detail because of its potential implications for future EU energy policies. The time has come to dissect An investment strategy to keep the European Green Deal on track or at least take out some organs and examine them.

For starters, Bruegel estimates that the EU would need to invest some 7.7% of its GDP in the transition in order to hit its 2030 decarbonisation targets. That’s a modest 1.304 trillion euro until 2030, rising to an even more modest 1.537 trillion euro between 2031 and 2050 for the ultimate net-zero goal.

Neither of these figures is certain, however. It could end up costing either more or less. But it’s unlikely to cost a lot less. In fact, it’s most likely to cost even more than estimated because of the many costs that the EU has not factored into its estimates, such as workforce reskilling “from brown to green jobs” and unspecified “climate adaptation”.

Okay, so we’re talking about a lot of money that has to come from somewhere. In previous references, I mentioned the emphasis that Bruegel puts on so-called behavioural changes such as buying EVs and consuming less energy. But even with behavioural changes, which by the way are not exactly forthcoming, European countries would need to spend heftily on their transition. And they don’t wanna. So some brainwashing is in order.

“Even before the 2024 US presidential election, swings to populist nationalist parties in large countries including Germany and France suggested unease among voters about climate policy,” Bruegel tells us.

“These parties indeed often preach the false belief that decarbonisation is detrimental to competitiveness and security, when it is exactly the opposite. Green investment is fundamental for the EU to meet its pressing competitiveness and security objectives, even if complex trade-offs exist between these different societal objectives.”

It’s good of the authors to admit there are “complex trade-offs”, which is essentially an admission that the transition will cost an arm, a leg, and a pair of… never mind. Yet this admission’s only purpose is to double down and then triple down on:

• prioritising transition industries above all others in terms of accessible capital costs

• subsidising the living hell out of unviable technology, and

• squeezing living standards to fit into the net-zero mould.

And how are they going to do it? By:

• tying transition action to all national policies

• even more regulation, read mandates

• a lot more centralisation, and

• carbon prices