Net zero will be far more expensive than public thinks, Lords warned

Comment: “The problem is that net zero is very popular until people get asked to pay for it.” And get pushed into giving up things like fuel-powered private transport and home heating, for alternatives many don’t want at any price. None of this is new, but here it’s getting aired in a national political forum. Chasing climate obsessions and targets at any cost and by any means, including by increasing national debt as suggested here, is an ongoing drag on everyone for debatable reasons.
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Net zero will be far more expensive than the public has so far been led to believe, top economists have warned the Lords Economic Affairs Committee. — The Telegraph reporting.

Transitioning to a low-carbon economy is “necessary” but will be “much more expensive than people imagine”, Olivier Blanchard said.

The former chief economist of the International Monetary Fund said there was a “substantial fiscal cost to achieve anything close to net-zero”.

Mr Blanchard, who is now a senior fellow at Peterson Institute for International Economics in Washington DC, said the exact cost of the transition was unknown.

However, he told the Lords committee: “The public does not believe, or has not been made to understand, that is going to be costly for them. It is going to be costly and that message has to be sent out.”

The economist said that governments would have to borrow more money to fund the shift to net zero, as paying for it purely through higher taxation was not politically feasible.

He pointed to France and Germany where farmers are protesting the phasing out of diesel subsidies and other EU environmental regulation as an example of the political challenges inherent in net zero.

Mr Blanchard said: “I think realistically we have to accept the fact that for a while it will have to be financed by debt, namely the primary deficit will have to be a bit larger as a result. I suspect that for the next few years, probably 0.5pc more is the absolute minimum needed.”
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Charles Goodhart, a founding member of the Bank of England’s Monetary Policy Committee, told the Lords committee: “The problem is that net zero is very popular until people get asked to pay for it.”

Full report here.