Treasury net zero review is very interesting, in green terms, but also as a mere statement of strategy - eg openly pointing to poor UK productivity performance, in the last few years again the worst in G7 for investment, having been overtaken by Italy...
*Levelling up* code alert - will green policy on cars eventually subsidise wealthy Tesla-drivers in cities, & punish less well off drivers who stick with petrol/diesel for longer, Treasury muses to itself....

Also the £30bn elephant in the room known as “VED” or road-pricing...
Also this translated -

We’ll have to tax gas more and electricity less, because although electricity is now very low carbon/ renewable, we load all carbon levies on to it rather than tax the actual carbon in gas.

But right now after the gas price quadrupled to a record? 2022!
Back on EV point - chief selling points to incentivise people to buy EVs is its cheaper, partly because no VED. But VED will then reduce so much it will be replaced by road pricing, taking away some (a lot?) of the running cost benefit incentive...

One for the 2024 manifestos.
OK Carbon Border Adjustments...

UK no likey. Questions WTO legality and whether
“straightforward” But EU, some big European nations, Canada, are looking at effectively applying a tariff to high carbon intensive goods to prevent “leakage” ie undercutting on climate
UK Carbon Border Adjustment would somewhat complicate doing of trade deals around the world, and we’ve already seen a willingness to not mention even the PAris agreement in eg Oz trade deal... “green trade wars/ protectionism” will be increasing geopolitical issue in coming years
Although this rather interesting chart shows that UK manufacturing is so carbon unintensive that it would be difficult to find a basis to charge a green tariff on the UK... important exceptions here are refineries and plastics...
The review effectively states that “working collaboratively” on “effective international action” beats a Carbon Border Adjustment Mechanism - one to watch, esp those areas where British manufacturing is hurt by UK going faster than others on climate alleviation.
This is very interesting HMT chart - richest decile (10%) emits three times as much carbon as poorest. Though they have 8x as much income on average. Difference is savings. Saving money = not consuming = green,
But 😞- HMT avoids trap of publishing forecast of household impact of net zero policies...
But this it hopes shows that annual bills for power, heating and transport, will be the same via heat pump and EV by 2050, in 2020 prices...

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More from @faisalislam

20 Oct
On comparative Covid picture - interesting thing, noticed by pretty senior UK officials too, about being in Washington DC last week, was it felt like being transported back to UK early spring.

Everyone wearing masks indoors, many outside too...

And just whole town feeling empty
DC has broadly comparable vaccination rates - partial - 72% vs 73%, full 60% vs 67%... but completely different in relation to opening up. Goes to show what many economists stressed - lifting lockdowns is one thing, people to have confidence to end voluntary social distancing too
There are relatively few people able to make such comparisons because ordinary travel to US from UK still just about banned until November, we were allowed under State Dept exemption...

Perhaps its consequence of POTUS focus on caution/ masks etc ...
Read 4 tweets
20 Oct
NEW
Hastily deleted Govt Net Zero research paper, suggests

🍖 shift diet habits to plant based & producers/retailer tax on high carbon foods
🌱 policy “to normalise plant based food”
✈️ make in person meetings requiring biz flights “immoral indulgence”
bbc.co.uk/news/business-…
Government swiftly, deleted & disowned “BEIS Research Paper Number 2021/063” written by the Nudge Unit, aka the Behavioural Insights Team famous for sugar levy and “herd immunity” comments...

source: “We have no plans whatsoever to dictate consumer behaviour in this way” Image
Govt say was never policy, was part of range of inputs into Net Zero strategy considered, but then did not make it into policy... and shouldn’t have been published.

But it shows what influential team say is necessary as regards a Government “nudging” consumers towards net zero
Read 9 tweets
19 Oct
Food & Drink Federation chief Ian Wright tells MPs hospitality inflation is running at 14-18%, which is “terrifying”, says it is a precursor to retail, relays story from the 70s of supermarket prices rising twice in a day… says we can’t go back to that…
“says inflation is bigger scourge than anything else esp for levelling up because it discriminates against the poor…” first part about shortages on shelves - said seasonal produce, traditionally given top place on supermarket aisles replaced by lynx deodorant as that’s available
FDF also broke down the different dynamics of labour shortage, in particular the hundreds of thousands of EU workers WITH settled status, who have nonetheless gone home and not returned (so not a Brexit issue on its own, but In combination with pandemic/ lifestyle changes etc…
Read 4 tweets
15 Oct
NEW French finance minister Bruno Le Maire said he discussed with Chancellor Rishi Sunak at IMF about how supply chain crisis “more difficult” for Britain outside Single Market. He told me “when you ask for more truck drivers.. single market helps facing these bottlenecks”...
In interview with me in DC, Le Maire also said G7 discussed replacing supply chains stretching to China, Taiwan and Korea and rebuilding them in western democracies “building these new value chains among partners among friends has been one of the solutions discussed within G7”
Le Maire reflected that President Biden sounded “Gaullist” in his speech this week saying the US would “never again” become overly reliant on one country or one person for supplies. “I'm a Gaullist. So, I’m fully supportive to that kind of approach...”
Read 8 tweets
14 Oct
Overnight spoke to Chancellor in DC after he chaired G7 finance ministers, on supply chains, inflation, support to heavy industry, and avoiding a trade war with EU over NI protocol...

Said he was “confident there'll be a good amount of Christmas presents available”...
On supply chains Sunak said: British consumers “should be reassured” Govt is doing “absolutely everything we can”... and said events at LA Port showed pressures were global...
I asked him why PResident Biden had got CEOs into the WH to solve the problem, Govt had blamed business
Chancellor said “everyone” including the PM accepts that increasing wages without increasing productivity would be inflationary. He said the move to a high wage high skill economy advocated by the PM would “obviously take time”.
Read 6 tweets
12 Oct
In DC at IMF meetings of finance ministers/central bankers as post lockdown world economic recovery gets messy

IMF just released new forecasts trimming growth prospects this year for UK and US on “longer than expected” supply disruptions and “upside risks” from rising prices...
UK growth is now forecast to be the highest in G7 in 2021 after US was downgraded more than the UK... second to US next year... this reflects welcome rebound from worst hit in G7 last year...
IMF points out pattern of global economic damage is opposite of 08-09 financial crisis, now developing countries are being hit harder, with advanced economies faring better from now, because of “greater protection against further Covid-19 shocks from more widespread vaccinations”
Read 5 tweets

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