Energy: the years of neglect

Monday 20 September 2021  

Alok Sharma, Minister of State in the Cabinet Office and the UK's COP26 stool pigeon, was on the Marr Show yesterday, reiterating the government's devious line on the gas crisis, telling people that they should not be concerned about the risks of gas supply. "We do not see risks of supplies right now", he said.

This, of course, is a glorious red herring, classic misdirection from a government that has nothing to gain from telling the truth, even if it knew how to. The situation is far beyond its control, and all it can do is hope that things don't get worse.

But even if the situation does deteriorate further, a shut-down of domestic gas supplies - which is what is being implied – is not on the cards. That would give rise to an uncontrolled pressure drop in the distribution system, with the risk of air entry, creating an explosive mix. That could be even more disastrous than Johnson's government.

Thus, long before we reach this critical point, the system operators will be taking a series of actions to conserve bulk supplies and keep domestic consumers supplied. This would involve shutting down high volume industrial users and limiting the amount of gas released for electricity generation.

The net effect, as Ambrose Evans-Pritchard in the Telegraph rightly points out, could be the return of a 1970s-style three-day week, with a rolling programme of planned power cuts being instigated to protect the system from a catastrophic cascade failure.

As to the proximate cause of this crisis, informed opinion seems to agree that it was the UK's decision not to encourage investment in Britain's gas storage facilities, leaving us with the lowest level of strategic reserves of any country in Europe (see chart above), and almost uniquely vulnerable to any large-scale perturbations in the supply of gas.

The role of gas storage is well known. With Britain anticipated to move from self-sufficiency to a net importer, the House of Commons Trade and Industry Committee in 2005 observed that the government could ensure that there were no regulatory or economic barriers to maximising gas supplies and storage facilities, and improving the functioning of the gas market.

In 2009, a committee was hearing that while the United Kingdom was not very dependent directly on Russia, Europe was. If Europe did not secure the supplies from Russia, the knock-on effects for the UK, particularly with the new regime in place, would be significant. Thus, the UK needed to get gas storage capacity up to a level that would enable us to have the flexibility to provide a greater degree of security.

Against government reluctance to intervene, another committee in 2011 observed that the government needed to explain and justify why it believed a strategic reserve was needed to ensure a secure supply of electricity, but did not consider it necessary to intervene in the gas market to ensure more gas storage was delivered.

The UK, it said, "needs to significantly increase its gas storage capacity. The Government must develop a strategy for achieving this. Doing nothing - or continuing to give inconsistent signals to the market about which approach it will choose - could result in no storage being built. This would diminish energy security".

This, however, was not to be. Despite it being acknowledged that gas would be the major fuel for heat use well into the 2030s, in September 2013, David Cameron's coalition government, in the person of Secretary of State for Energy and Climate Change Edward Davey, decided not to intervene in the market to boost storage capacity.

Davey told parliament in a written statement that his department saw no clear case for intervention in the gas market, following analysis of three intervention options. "Our analysis shows that, although such interventions could enhance our gas security, under most scenarios they would not do so cost-effectively", he said.

In the accompanying framework, the authors suggested:
Interventions supporting new storage facilities would be unlikely to deliver security of supply benefits until the 2020s. By this time developments in global gas markets, such as the prospects for increased production from new gas sources such as shale gas, could improve an already large and geographically dispersed resource. When considering the extra interventions we have modelled, none gives a clear net benefit, while all carry significant risks of disproportionate impacts on consumer bills, costs to industry and unintended consequences.
Already, though, there were hints of the crisis to come. George Grant, chairman of Britain's Gateway Storage Co, pointed out that, at the end of the previous winter, there had been no LNG at any of the import terminals, gas storage capacity had been almost exhausted and import pipelines had been running at close to capacity. "The market delivered just but if there had been a major import pipeline outage for any period of time we would have been in trouble", he said.

Coincidentally, Davey – now leader of the Liberal-Democrats – was also on the Marr show yesterday. And although he was intensively quizzed about his raft of new policies, Andrew Marr didn't think to challenge him on his past performance as an energy minister.

Back in the day, despite Davey's ruling, the industry didn't give up. In April 2016, the Gas Storage Operators Group, forming the Energy and Utilities Alliance, published a report, stressing the importance of gas as "the single most important fuel in the UK's energy mix". Noting that the UK's secure indigenous supplies of gas were "in sharp decline", it warned that "relying on the global market for imports brings with it new supply risks and price shocks as witnessed over the last few years".

Gas storage, the industry said, can ensure that gas supplies are maintained at times of major supply or demand shocks, also protecting consumers from price spikes and ultimately reducing overall gas bills. Therefore, it said, "gas storage is vital for the efficient operation of the UK energy markets". Sub-optimal levels of storage capacity would result in diminished physical and price security, the effects of which would be felt "at both societal and economic levels".

This time, however, the role of Parliament was less than stellar. It took until October 2018 for Rachel Reeves, chair of the Business, Energy and Industrial Strategy Committee, to announce an inquiry, seeking to examine "what action the Government is taking to ensure we can have confidence in the security of our gas supplies".

By then, the largest facility in Britain, the Rough storage facility – capable of meeting approximately 10 percent of the UK's peak day demand – had been closed. The country had also suffered the "Beast from the East", which had brought a prolonged spell of very cold weather. "Given our increased reliance on gas imports", Reeves said, "we will also be asking what government is doing to guard against gas shortages and the potential knock-on effects of increased energy costs for businesses and domestic consumers".

Yet, even though the British Geological Survey then strongly recommended to the committee that Britain should consider more onshore and offshore gas storage in depleted gas fields and salt caverns, warning that the country's energy security "is closely bound up with how much gas it stores", to this date, Reeves's committee doesn't seem to have produced a report.

At the time, the Survey reported annual UK gas consumption at around 103 billion cubic metres, with storage capacity of approximately 4.6 billion - only 4 percent of annual consumption and much less than many European countries. By February 2019, the storage capacity had dropped to 2.5 billion cubic metres (bcm), in the form of Liquified Natural Gas (LNG) stored at terminals (1.2 bcm) and gas stored underground (1.3 bcm) – less than 2 percent of its annual gas demand.

Thus, based on the average daily demand (209 million cubic metres/day), the UK's total gas storage capacity was equivalent to 12 days of average demand (6 days from LNG stocks, and 6 days from underground storage). The storage capacity that can be called upon to deliver over one quarter of national gas demand on a cold winter's day.

That same February, Claire Perry, minister of state for Energy and Clean Growth told Rachel Reeves:
the UK's gas system is secure and well placed to respond effectively to unexpected changes in supply and demand, benefiting, as it does, from a mature and liquid gas market and an effective regulatory regime. Our system delivers gas prices that are amongst the lowest in Europe whilst maintaining international benchmarks for security of supply. We have also stress tested our resilience over the next twenty years, and we are confident that we will retain our current high levels of security now and in the future.
Yet still the situation gets worse, while a recent report noted that, at the start of March, Britain had experienced its longest spell of low wind output in more than a decade.

For more than a week, calm weather had covered the country. Wind farm output had fallen to as low as 0.6 GW on the 3rd of March, in sharp contrast to the 18.1 GW delivered later on that month. A prolonged period of low wind has been coined in German as a Dunkelflaute - a dark wind lull.

The event at the start of March had been the longest such period that Britain has experienced in the last decade. Between the 26th of February and the 8th of March the load factor of the national wind fleet did not go above 20 percent. Its average over the 11 days was just 11 percent, less than a quarter of their average in the month either side.

It goes on. Yesterday at 7 pm, according to the National Grid, wind was supplying 1.45 GW of generated power (4.6 percent), while gas was churning out 17.54 GW (56.1 percent), against an overall demand of 31.2 GW. By ten in the evening, with demand having dropped to 26.3 GW, wind was producing a mere 0.93 GW (3.5 percent) while gas was still taking the strain, delivering 16.19 GW (61.6 percent).

But now, after years of neglect compounded by complacency spiced with bad advice, it is actually too late to do anything, except throw taxpayer's money at the problem. As Ambrose Evans-Pritchard notes, the UK is now at the mercy of global events. There are various factors which could come to our aid, but none of them can be influenced by our government. 

It is an invidious situation for Britain to find itself in, AEP says: "Downing Street can only hold its breath, and hope".

Also published on Turbulent Times.

Richard North 20/09/2021 link

Energy: mushroom management

Sunday 19 September 2021  

It was only very recently that I found myself writing that ministers in the Johnson administration couldn't even tell the truth if they were ringing up the fire brigade to report themselves on fire and ask for assistance. The lie, I concluded, has become embedded in the very fabric of government.

That was said in respect of the ennobled David Frost but, in the more recent context of the security of energy supplies, it must also apply to business secretary Kwasi Kwarteng.

After a series of meetings with senior executives from the energy industry to discuss the impact of high global gas prices, he is telling us that gas supply this winter is "not a cause for immediate concern".

The UK, he adds, benefits from having a diverse range of gas supply sources, "with sufficient capacity to more than meet demand. The system continues to operate reliably, and we do not expect supply emergencies this winter".

He goes on to say that our largest single source of gas is from domestic production, and the vast majority of imports come from reliable suppliers such as Norway, claiming that we are not dependent on Russian oil and gas.

As to "our exposure to volatile global gas prices", rather than assure us that measures were in hand to deal with this crisis, Kwarteng simply hid behind the government's propaganda line, asserting that this "underscores the importance of our plan to build a strong, home-grown renewable energy sector to further reduce our reliance on fossil fuels".

However, at several levels, there are good reasons to distrust this man and, therefore, to reject the line that he wishes to convey – that there is no cause for alarm. In the first instance, while the honeyed words issued by the minister give a patina of reassurance, textual analysis of what he actually does say is very far from settling the issues of concern.

For instance, Kwarteng tells us that the gas supply is "not a cause for immediate concern". Yet, if that is true, it is also irrelevant. If there is to be a gas crunch this winter, then typically it will occur in March or April, when stocks are traditionally at their lowest.

Similarly, the assertion that UK benefits from having a diverse range of gas supply sources is also irrelevant.. On its own, it is empty rhetoric. For sure we have an element of diversity, but that is of little help if there is global competition for supplies and we are way down in the queue.

Nevertheless, the secretary wants us to accept that there is "sufficient capacity to more than meet demand", again phrasing which seems to convey something of value. The choice of the word "capacity", though, is ambiguous. Undoubtedly, there is sufficient capacity to supply all the UK's needs. But capacity is not the issue.

What matters here is accessibility of supplies – the rate of flow through major pipelines and the amount in storage which can be withdrawn quickly to meet peak demands. The assertion that "we do not expect supply emergencies this winter", in this context, is a non-sequitur. It does not follow that "sufficient capacity" will insure us against shortages in periods of peak demand.

And then there is the phrasing: "we do not expect". This is classic Whitehall-ese which simply paves the way for the back-covering statement when the supplies do run out. At that point, the secretary can simply allude to his earlier statement and say, soothingly, "well, we didn't expect that", as if it somehow absolves him from responsibility.

This brings us to the assertion that "our largest single source of gas is from domestic production". This is true, but it is only 40 percent and falling. And what matters is the rate of production. In the summer, historically, we over-produce so transfer the surplus to storage for the winter, when demand outstrips supply. The crucial issue, therefore, is the amount of gas in storage – about which Kwarteng says nothing.

He does, nevertheless, correctly assert that "the vast majority of imports come from reliable suppliers such as Norway". This is true, but that also means that some of our gas comes from suppliers who are not so reliable. And, towards the end of the heating season, when supplies can be critically low, it is on these that we might depend.

In this context, there have been occasions when the UK has been one or two shiploads of LNG away from disaster, the relief dependent as much on the availability of specialist ships as the supply of gas itself. And, with acute global competition, there are no assurances that supplies will be there when we need them.

As to Russia, it is the case that we are not dependent on supplies from that source, although we do get about eight percent of our gas from Russian fields. That, in itself, is significant, but it is not the point. The crucial thing is that most of Europe is dependent on Russian supplies and if there is interruption in supply, then gas supplies which we might draw from – such as in the Netherlands – might be diverted elsewhere.

Then we have the propaganda line about the importance of building "a strong, home-grown renewable energy sector to further reduce our reliance on fossil fuels". This, bluntly, is insulting. A large part of the problem at the moment is that renewables are underperforming – especially wind. By the beginning of September 2021, the UK had 10,973 wind turbines with a total installed capacity of over 24.2 GW: 13.8 of onshore capacity and 10.4 offshore.

Yet, at 2 pm yesterday, the generation from wind, recorded by the National Grid was 0.5 GW, climbing to 2.76 GW by 7 pm and less than 5GW by midnight. For the day, fossil fuels (mostly gas) provided 52 percent of our generated electricity, averaging 13.69 GW. Wind averaged 5.9 percent, delivering 1.55 GW.

Therein lies the problem. For the whole of the past year, wind has only averaged 5.37 GW, delivering 17.6 percent of demand. This has forced gas to take the load, averaging 12.23 GW amounting to over 40 percent of demand.

Thus we are going into the heating season with reserves depleted and, with post other European countries in a similar position, demand for gas has soared and prices have hit record levels. Renewables are not the solution, as the fool Kwarteng asserts. They are part of the problem – a major part of it.

This propaganda element, in my view, does much to erode the trust one might have in the secretary's statements. And underlying this is another serious element – the lack of reliable information on the status of our energy supplies. To put it mildly, the government statistics in this sector are a mess: difficult to find, incomplete and late. The only official information I can find on gas storage is from November 2020, and that doesn't say very much.

Kwarteng, or course, could have supplied the crucial information in his statements, to back up his assurances, so that we could see for ourselves what the situation is. But this is not the British government's style. It relies on its patronising mixture of reassurance and mushroom management, expecting us mere plebs to accept what we are told from our "superiors".

It comes as no surprise, therefore, that we get more information about our situation from the head of Russia's Gazprom, Alexei Miller, than we do our own government. Miller tells us that that natural gas prices in Europe could rise further because of "shortages in underground storage", with stocks 22.9 billion cubic metres below normal levels.

As it stands, therefore, when Kwasi Kwarteng tells us, "Don't panic", there is every reason to run screaming for the exit. With a government headed by a congenital liar, we would be unwise to trust his minions.

Also published on Turbulent Times.

Richard North 19/09/2021 link

Energy: wishing for a warm Christmas

Saturday 18 September 2021  

With recent events in Afghanistan, and the amount of reading I've been doing on the subject recently, it occurred to me that I probably know more about the secretive ISIS-K terrorist group than I do of the internal workings of the European (and global) gas market.

Yet, as I look morosely upon the eye-watering increases my utilities provider is proposing for this winter, there can be no doubt that, at the moment, my gas supplier is a greater threat to my wellbeing than these homicidal terrorists.

I was thinking perhaps that we should ask ISIS-K to become a gas provider. With that, all our major threats would be in one basket. But then I discovered that the main price reporting agency for energy supplies is a firm called Icis, so truth might be closer to fiction than we imagined.

Anyhow, Mr Ed Cox of said Icis has been setting the scene for the train-wreck that is the UK's energy policy, telling us in the indefatigable jargon of his trade that gas prices in Britain have been "caught in a bullish cycle this year that has covered Europe and Asia".

Cox adds: "The outlook for the winter in both regions is a concern. In Europe, gas storage levels are just 68 percent full, the lowest for the time of year on record. Storage plays a major role in security of gas supply in Europe over the peak winter demand period".

The UK is particularly vulnerable to storage issues as it has less capacity than many of its European neighbours. In addition gas production in the North Sea has fallen this year because of maintenance shutdowns and delays to projects because of the pandemic.

However, according to the Russian newspaper Tass, which has a particular interest in energy matters, European gas storage levels, before the start of the heating season, are not only in deficit, the backlog is so enormous that it cannot be made up in time to cover the winter demand. 

 By way of example, gas storage facilities in the Netherlands have only reached 50 percent of capacity. As of 1 October, they are usually above 80 percent. The Germans and Austrians, other important gas users and countries with large storage, also lag behind with 60 and 48 percent respectively. Only the French are in a near comfortable state, with reserves approaching 85 percent.

This year, because of the cold winter and spring, pumping into storage began three weeks later than usual. But there are also complaints that Russia has been sending less gas to Europe.

One possible reason it that it too needs to refill its storage, but there are suspicions that it is engineering a shortage to force rapid regulatory approval of its recently completed Nord Stream 2 gas pipeline. This undersea pipeline, which by-passes Ukraine, is now ready to deliver gas to Germany and needs only the approval of the German authorities and the EU, although this could take as long as six months.

Meanwhile, as wholesale prices soared above $800 per 1,000 cubic metres of gas (peaking close to $970 on Wednesday) – driving electricity prices to 11 times the baseload level - the Telegraph carried news of 40 MEPs signing a letter accusing Gazprom of "deliberate market manipulation", while retailing claims that Russia is seeking to undermine Britain and the EU's economic recovery from the Covid-19 pandemic.

Tass, on the other hand, cites Brussels-based political analyst and energy market expert, Simonas Vileikis. He puts the prices increases down to a number of "objective factors".

Firstly, gas production throughout Europe is static, with few possibilities of increasing output, especially in Norway, the Netherlands and Britain. Secondly, most supplies of liquified natural gas are moving to Asia where the economic recovery is triggering substantial additional demand for energy.

That problem is only going to get worse. According to Gazprom CEO Alexey Miller, China shows "stunning" potential for gas demand growth, with the Asia-Pacific region is expected to grow by 1.5 trillion cubic metres by 2040.

Vileikis also confirms that the deficit of gas on the EU market is so serious that even increased supplies via existing routes from Russia and Algeria cannot satisfy the demand and also fill Europe's storage facilities. Any extra supplies via Nord Stream 2 will be welcome, especially in an election year in Germany, but they won't be enough to address the structural shortages.

Dermot Nolan, former chief executive of Ofgem, adds another factor. The higher gas prices, he says, have been exacerbated by "relatively low wind output". Wind speeds have been unusually low across Europe for the past few months, which means that wind farms are producing less power than usual.

Then the UK has its own special problems. Although Britain's current peak electricity demand stands at a relatively modest of around 35GW, some 17GW of non-intermittent generation - gas, coal, nuclear and underwater power cables - are offline. Some 3GW of this is nuclear and 2GW have been lost after last week's fire in the French interconnector. Gas plants are having to fill the gap.

This situation does not entirely invoke confidence in the government, which claims that the gas price surge vindicates its focus on moving to greener sources of energy.

A spokeswoman thus tells us: "Our exposure to volatile global gas prices underscores the importance of our plan to build a strong, homegrown renewable energy sector to further reduce our reliance on fossil fuels". Somehow, one gets the impression that they haven't quite got a grip of the situation.

Illustrating how separate strands of the economy are closely interlinked, we see reports that the gas price hike has raised the spot price of electricity to such levels that fertiliser manufacturer CF Industries have halted operations at its plants at Ince in Cheshire and Billingham in Teesside this week, with no indication of when it intends to reopen them.

CF is understood to produce more than 40 percent of the UK’s fertiliser supply. But crucially, the plants produce carbon dioxide as a by-product of the ammonia used in the fertiliser production. This accounts for as much as 60 percent of the UK’s industrial CO2.

With the plants offline, poultry processors are concerned that that supplies for euthanising birds on the slaughter lines will run short, further disrupting food production, exacerbating the ongoing labour crisis and ultimately leading to food shortages.

CO2 gas is also used for modified atmosphere packaging used to extend the shelf life of perishable foods, and especially red meats and products such as cheese. Thus production of these foods could also be affected.

While food producers are struggling, energy suppliers are doubtless hoping that there is no more bad news waiting in the wings. "We're not yet even into autumn proper, so there’s plenty of time for other things - good and bad - to happen ahead of the winter", one industry source told The Times.

If wind speeds pick up and the winter is mild, fears of power shortages may prove overblown, says Tom Edwards, of Cornwall Insight, the energy market consultants. Then adding a statement of the bleedin' obvious, he says he would be concerned about security of supply if we had a "cold, windless day and something else breaks down".

The big danger, or course, is a major, unexpected plant shutdown, triggering a large-scale cascade failure which could leave large parts of the grid without power for days, if not weeks.

Should this happen – on top of all the other crises building up over the winter – as Pete observes, the results won't be pretty. This all the more so as successive governments have had more then two decades to prepare and, more than ten years ago we were forecasting massive price hikes.

Now, it is almost too late to do anything but watch and wait, hoping that the weather is kind and the winter is not too severe. Bizarrely, Johnson's survival may rest on how much snow we get. He will not, we suspect, be wishing for a white Christmas.

Also published on Turbulent Times.

Richard North 18/09/2021 link

Brexit: damp squib on regulation

Friday 17 September 2021  

The mockery has already started, following the government's commitment to review the EU's ban on markings and sales in imperial units and its promise to legislate in due course.

This is one element of the plans "to capitalise on new Brexit freedoms" announced yesterday by the ennobled David Frost, part of a process to make our rules and regulations "best serve the UK national interest".

But those who choose to mock at the return of pounds and ounces to Britain's high streets will be missing the point. Compulsory metrication was one of those landmark issues which illustrated how EU powers were reaching into the lives of ordinary people.

The resentment was given a focus on 4 July 2000, when council officials supported by two policemen converged on a fruit and vegetable stall in a Sunderland market, owned by Steve Thoburn, to seize his scales.

This draconian step had been precipitated by an ordinary action of Thoburn, selling his wares by the "pound", as his customers preferred, rather than in the kilograms that since 1 January had become compulsory. But what was once an natural, legal action had now become an offence for which Thoburn faced criminal prosecution.

This was the first time the EU's new metrication law had been put to the test, the culmination of the process of compulsory metrication that had been imposed on Britain without Parliament ever being consulted. With Thoburn having, in effect, been selected as a test case, his case hit the national headlines, and through the efforts of his fellow marketeer-turned publicist, Neil Herron, the legend of the "metric martyrs" was born. It attracted massive nationwide and international publicity for the anti-EU cause.

When a case taken by Sunderland Council against Thoburn reached the High Court, its decision in 2002 reaffirmed the supremacy of EU law. Metrication thus became a cause célèbre in the growing Eurosceptic community.

The affair took on a more sombre turn in 2004 when Thoburn died prematurely at the age of 39 from a heart condition. His funeral and the subsequent wake at the Stadium of Light, home of Sunderland Football Club, was attended by many devoted followers.

Thus the "metric martyrs" acquired cult status. Their efforts did much to shift political sentiment in the north-east of England against the EU and were almost certainly responsible for the 61 percent leave vote in the 2016 EU referendum, against the 39 percent who voted to remain.

That the result was unexpected is indicative of how little the impact of the metric campaign had registered with outsiders – including a Ukip MEP, who had no more idea than the chatterati what was going on.

In that sense, it represented a microcosm of the entire anti-EU movement, which had been gathering strength under the horizon, decades before Cameron finally committed to a referendum. And the fact that so few of the above-the-liners realised what was happening is the story of the campaign.

It is some of those some people who are currently indulging in their mockery, demonstrating that they still haven't come to terms with Brexit, or understood the forces that were unleased by the growing encroachment of Brussels on our daily lives. Many are beyond reach, and will go to their graves without understanding.

It is entirely predictable, therefore, that the likes of the Daily Mail should have focused on what, in effect, is payback time. Those of a certain age will be able to embrace the return of imperial measurements – a gesture of defiance and a tangible sign that we have left the EU.

In another iconic move, the government is to repeal the EU-derived prohibition on printing the Crown Stamp on pint glasses. It will allow publicans and restaurants voluntarily to "embrace this important symbol on their glassware, should they choose to do so".

This remedies another irritation, imposed by the Measurement Instruments Directive (2004/22/EC) which came into force in 2006, requiring glasses to bear the "CE" mark and prohibiting "supplementary metrology marking".

In so doing, it broke a tradition reaching back to the reign of King William III in 1699, and to the reign of William IV with the compulsory introduction of verification marks in 1835. The Directive thus stood as a testament to the lie that the EU would not have any effect on the British culture. On the accumulation of such small traditions does the culture of a nation in part rest.

That said, as a serious attempt to reduce the burden on EU regulation, yesterday's announcement is pretty thin stuff overall, built as it is on Iain Duncan Smith's Taskforce on Innovation, Growth and Regulatory Reform (TIGRR). This was launched in February of this year with the objective of scoping out and proposing options "for how the UK can take advantage of our newfound regulatory freedoms".

The Guardian tried to make a fist of it, headlining: "Rules on GM farming and cars to be top of UK bonfire of EU laws", adding by way of a sub-head: "Minister reveals plans to change laws inherited from EU, with rules on medical devices also in crosshairs".

The reference to "cars" is an odd one, with Frost's letter stating that the government will shortly "set out ambitious plans which include modernising outdated EU vehicle standards to unlock the expansion of new transport technologies as outlined in TIGRR".

One hesitates here to suggest that the ennobled David Frost really doesn't know what he's talking about – if only because the repetition is so tedious. But he should know by now that the "EU vehicle standards" are actually produced by UNECE's World Forum for Harmonization of Vehicle Regulations (WP.29).

Far from being outdated, the regulatory process is dynamic, with amendments and new standards constantly being framed. Currently, the working party is focusing on electric vehicles, producing global standards, conformity with which will be vital for export sales.

Furthermore, the ennobled David Frost may have forgotten, but the UK is committed to working with WP.29 standards, by virtue of the TCA (Annex TBT-1).

As to rules on genetically modified farming, it is fair to say that progress (if it can be called that) in the EU has stalled, but if the UK wants to join the US in developing and using this technology, it will thereby ensure that much of its agricultural production is excluded from the Single Market.

For much of the so-called plan, though, much of the text is so vague that little can be deduced from it. Some issues, such as procurement and port regulation, look promising, but there will be "double coffin-lid" constraints here and elsewhere, which may shape the final proposals. That much certainly goes for the ideas on financial services and investment reform.

On balance, therefore, much of what we see is not so much a bonfire of regulation as a damp squib, to be taken with a pinch of salt. But, at least that pinch can be measured as a fraction of an ounce rather than a gram. What more can one ask?

Also published on Turbulent Times.

Richard North 17/09/2021 link

Agriculture: another disaster secured

Thursday 16 September 2021  

One does not have to be unduly cynical to suggest that Johnson's reshuffle was aimed at replacing his low-performers with ministers who have the potential to do even worse.

That would certainly explain why Defra secretary George Eustice hasn't been reshuffled. Quite evidently, Johnson was unable to find anyone who could make as big a mess of his new farming policy, thus protecting his administration's reputation for incompetence, limited, it seems, only by the number of activities in which it partakes.

Certainly, the farming policy, is the latest in the long line of clusterf**ks perpetrated in the post-Brexit world of team Johnson. It's the government's idea of a replacement for the EU's CAP, but it turns out to be so bad that most farmers don't want anything to do with it.

So utterly destitute of good sense is it that even the National Audit Office has noticed, issuing yesterday a lengthy report, accompanied by a press release, heralding its critique of what the government calls a "once in a generation opportunity to reform agriculture".

We've actually touched on this recently, remarking on the uselessness of Defra secretary Eustice and his fabled hedgerow policy, but this is only part of a broader initiative which goes under the name of the Environmental Land Management scheme (ELM).

The ELM, we are told, is the primary mechanism for distributing the £2.4 billion subsidies previously paid under CAP. Instead of the direct payments under the EU's scheme, which accounted for about 80 percent of disbursements, ELM (in theory) will pay farmers for environmental improvements, through the Sustainable Farming Incentive (SFI), the Local Nature Recovery and Landscape Recovery schemes.

Farmers, we learn from our own sources, have been discussing these schemes and have concluded that they are basically "tick box" exercises run from Whitehall. This is bolstered by the general view that Defra desk jockeys in charge would be hard-pushed to manage a window box – even a paved one – much less a farm, an observation borne out by the NAO's observation that: "Defra has not yet established objectives to support its high-level vision for ELM".

One of the many weaknesses of the scheme is that, for assessment purposes, the country is lumped together as a single unit, with no quarter given to temperature, structure, crops or weather conditions in different regions, thereby replicating the central flaw in the CAP.

Grass crops, for instance, cannot be taken before 8 May in any year – irrespective of the area, whether in balmy Cornwall or frigid Northumbria. Subsequent cuts of silage can only then be made after 8 weeks. These may be arcane details but experienced farmers will tell you that these restrictions would impact severely on their ability to crop grassland profitably.

Another little gem is the way fallow wildlife strips are treated. Under the CAP, farmers were required to leave one metre uncultivated between the hedge margins and the crop. But Mr Eustice wants 4 metres, either side of a "hedge", regardless of whether that's green or stone or earth banks. That takes such a huge chunk of the working area that cropping some smaller fields would no longer be viable.

Payments are also smaller than farmers have been getting for the CAP scheme and the indications are that they will not be index-linked. Thus, cash paid in year one could be the same as in year ten, despite increases in the costs of inputs to comply over the period.

With so many petty tick box "must do" requirements for so little reward, enforced by legions of inspectors knocking on doors and imposing penalties for non-compliance, it is hardly surprising that the take-up has not met with Defra's expectations. Of the 44,000 eligible farmers in England, only 2,178 have expressed an interest in taking part. Johnson's reputation for securing policy disasters remains intact.

Despite, or because of this, the prime minister was one of the virtue-signalling MPs attending PMQs yesterday sporting heads of wheat in various places on their attire to celebrate the NFU's "Back British Farming Day". Johnson had three heads stuffed in his top pocket, but so far distant has the very idea of farming become that The Sun described them as "sheaves".

It is hardly surprising, therefore, that the only national paper which seems to have run the NAO story is The Times. It leads on the NAO warning that that lack of participation by farmers could undermine the government pledge that Brexit will benefit the environment by allowing farmers to be rewarded for improving soil and water quality and protecting wildlife.

The audit office says that: "Defra has not yet regained enough trust from farmers to be confident in achieving a high level of participation in the environmental land management scheme".

The Department, it asserts, lost farmers' trust as a result of difficulties with its management of past agricultural subsidies. But delays in informing farmers which actions they will be paid for, and how much they will be paid, have made matters worse. "Defra sees rebuilding trust as vital, but both the NAO's and Defra's own evidence show it has not yet succeeded", the NAO warns.

The NFU agrees that there are "significant challenges to overcome" to ensure that the Defra schemes are successfully delivered – typically pulling its punches when it should be slamming Defra in general and Eustice in particular for their incompetence.

One might think though that even this mild rebuke might have Eustice springing into action to make his schemes more palatable to hard-pressed farmers, who are already having to complete against better-subsidised EU farmers who are still able to export their produce to the UK without border checks.

But the only response we have seen so far, though, is another half-baked plan, this one supposedly to help farmers export their produce.

Amongst the goodies on offer are more, dedicated "agri-food attaches" to act as "representatives on the ground" in UK embassies "to unlock key markets across the world". The government will also appoint another quango, a "Food and Drink Exports Council" which – as farmers are doubtless excited to learn – will "work collaboratively to expand our food and drink exports strategy".

And if this wasn't enough, the government will strengthen our technical expertise as well as our farmers and producers' understanding of export markets to ensure that food and drink exporters are able to benefit from market opportunities. I am sure farmers will be delighted to have their understanding strengthened.

All this, though, will have to wait as the "initiative" isn't going to be launched until later in the year, on some as yet unspecified date. The only thing immediately on offer is a raft of patronising slogans from the egregious secretary, who describes our hard-pressed sons of the soil as "the lifeblood of our nation – producing home grown food and acting as stewards of our natural environment".

As if that wasn't bad enough, they also have to suffer the newly-appointed foreign secretary, Liz Truss, telling them that "our food and drink is among the best in the world and [as] an independent trading nation we're seizing new opportunities that were previously denied to us".

Their cups overfloweth as they learn from this source that, "We have already secured better access to lucrative Asian markets, including for UK beef in Hong Kong, Japan and the Philippines". This might be absolutely peachy when or if any UK slaughterhouses are approved to handle this trade.

On the other hand, farmers may just be a little wary after the gushing announcement back in 2019 of a beef export deal to China. With none of the small-print details yet having been satisfied, nearly two years later, not so much as a hoof-clipping has been exported.

Nevertheless, the sycophantic NFU president, Minette Batters, is easily pleased, welcoming this "positive step in the right direction", not specifying how it is possible to have a positive step in the wrong direction. While her membership is being starved of cash and fed a diet of platitudes, she looks forward "to seeing more detail on this proposal and working with government to boost our agri-food exports abroad".

And still, as Mr Eustice is claiming that: "We will incentivise sustainable farming practices and reward farmers for environmental assets on their land", we can see Johnson's point. It is hard to imagine that he could hire anyone worse.

Also published on Turbulent Times.

Richard North 16/09/2021 link

Brexit: pragmatism redefined

Wednesday 15 September 2021  

Formally, the nation was advised yesterday by way of written statements, one from the recently ennobled David Frost addressed to the Lords, and the other from Penny Mordaunt, to the Commons.

The plebs were then advised in a press release, telling us that: "The government has set out a pragmatic new timetable for introducing full import controls for goods being imported from the EU to the UK".

According to our wise and beneficent government, now the UK is an independent trading country, it was our intention is to introduce the same controls on incoming goods from the EU as on goods from the rest of the world.

The initial timetable for the introduction of the final stages of those controls was announced on 11 March, says the ministerial statement – setting the introduction of checks on SPS goods to start on 1 October. And, says the government, its own preparations, in terms of systems, infrastructure and resourcing, "remain on track to meet that timetable".

However, it goes on to say, the pandemic has had longer-lasting impacts on businesses, both in the UK and in the European Union, than many observers expected in March. There are also, it says, pressures on global supply chains, caused by a wide range of factors including the pandemic and the increased costs of global freight transport. These pressures are being especially felt in the agrifood sector.

Given these circumstances, therefore, our wise and beneficent government has kindly decided to delay further some elements of the new controls, especially those relating to Sanitary and Phytosanitary goods. The key requirements will now come into force on 1 July 2022, a further nine months' delay.

In the following press release, Frost is then cited as saying: "We want businesses to focus on their recovery from the pandemic rather than have to deal with new requirements at the border, which is why we've set out a pragmatic new timetable for introducing full border controls".

With that, it's come to the stage when one has to conclude that ministers in the Johnson administration couldn't even tell the truth if they were ringing up the fire brigade to report themselves on fire and ask for assistance. The lie has become embedded in the very fabric of government.

Unimpressed by this outbreak of "pragmatism", the Financial Times reports that Johnson's government has been "forced" to delay imposing checks on EU goods entering the UK until mid-2022, as it attempts to stop Brexit further exacerbating supply chain problems.

This, though, seems to falling for the Labour party schtick, which has it that delays on border controls were due to the government's inability to tackle supply chain problems caused by Brexit.

"This announcement shows what we have all known for months - that the government do not have a workable, sustainable answer to tackling delays and red tape at the border", says Baroness Jenny Chapman, shadow Cabinet Office minister.

Here, we see iNews go with this canard, headlining: "UK delays post-Brexit border checks on EU imports amid fears over Christmas supplies". The Sun treads a similar path, despite a view in much of the food trade that border checks would have relatively little effect on the supply chain.

The Guardian, on the other hand, goes for the Covid meme in its headline, reporting: "Britain to delay some post-Brexit border controls due to Covid", with the sub-heading: "Brexit minister says 'longer-lasting impacts' of pandemic on businesses have led to timetable shift".

However, this self-same newspaper also reports that signs that the government might have to delay the physical checks emerged in the summer when the officials told angry residents in Dover that plans for a giant lorry park for HMRC and SPS checks "had been radically downsized and would not be ready until July 2022".

It thus concludes that the government's lack of planning for Brexit "meant the necessary infrastructure involving border control posts in key ferry ports including Holyhead, Pembrokeshire and Dover has yet to be built". To this can be added Portsmouth while, even now, the locations of some border control posts remain to be announced.

On that basis, as I remarked yesterday, even if the government had wanted to go ahead on 1 October, it could not have done so because mechanisms for carrying out checks uniformly throughout the country simply do not exist.

Interestingly, when the government announced a six-month delay, from 1 April to 1 October – on 11 March – the Guardian then reported that the delay had been forced "because a network of 30 border posts being built to process incoming goods would not have been ready on time".

Now, though, even though the newspaper acknowledges that the network still isn't ready, it seems content to run with the government's Covid excuse. But then, last time the paper had business correspondent Joanna Partridge reporting. Currently, it has its real experts on hand, Lisa O'Carroll, the Brexit correspondent, and Daniel Boffey in Brussels.

The Financial Times, though, does allow some EU officials to "suspect" that Britain's border control regime is not yet fully ready for the new rules, despite Frost's insistence that the government is "on track".

Obviously enjoying the moment, one EU diplomat savours the irony. "They [the UK government] talked about taking back control", he observes, "but they are letting products into Britain without any controls at all. That’s fine with us".

That point is picked up in the Telegraph. It cites Ian Wright, the FDF chief executive, who complains directly that the delay "actually helps the UK's competitors".

"The asymmetric nature of border controls facing exports and imports distorts the market and places many UK producers at a competitive disadvantage with EU producers", he adds. ""Businesses have invested very significant time and money in preparing for the new import regime on 1 October 2021. Now, with just 17 days to go, the rug has been pulled".

Minette Batters, NFU president, reinforces these points, saying: "While our exporters have been struggling with additional costs and burdens, EU competitors have been given extended grace periods by our own government to maintain access to the UK market relatively burden free".

What nobody seems to be talking about, though, is the impact of a nine-month delay on local council port health authorities. In a way, this is hardly surprising as most hacks do not seem to realise that SPS checks are entirely separate from customs checks, and are carried out by local authorities. I even heard Damian Gramaticus on the BBC 6 o'clock TV news talking about "customs agents" carrying out the checks.

Unless the government comes up with serious money – probably running to several million - to enable local authorities to keep their inspection teams together, there is a real danger that, by the time the checks do come into force next July, there simply won't be the personnel available to operate the new border control posts.

In my view, the FDF and others are being rather optimistic about the impact of border checks on incoming food supplies but, if the staffing of BCPs falls short of operational needs, there really will be problems. And, one should recall, this also applies to airports, many of which handle considerable and growing volumes of freight.

Johnson's band of liars may have got away with it for the time being, by redefining the nature of pragmatism, but – as always – they are simply stacking up problems for the future. This one is set to come back and bite them.

Also published on Turbulent Times.

Richard North 15/09/2021 link

Brexit: confusion at the top

Tuesday 14 September 2021  

Archie Norman, chairman of M&S, has asserted that EU controls on exports, due to be mirrored on imports from Ireland and the continent, have added 24-hour delays to his company's deliveries and "serve no purpose at all". Food standards remain aligned to the EU, he says, so: "This is a pointless exercise".

"What we've discovered", he says, "is that the EU rules for governing borders, and their customs union are totally out of date, and not suited for the purpose they are designed for", calling them "a fandango of bureaucracy".

"Our product, our fresh sandwiches and ready meals, going to Ireland or France are delayed by about a day", he complains, adding: "that is not good if you are a sandwich". Only about 80 percent of our product gets through, he observes, "less than that in France because the French, predictably, are draconian".

What is extremely worrying about this is that the chairman of a major UK food retailer is apparently ignorant of the basic principles of the EU's "official controls". By his "customs union" reference, it is not even clear that he understands what he is actually dealing with.

His display of ignorance is at its most profound, though when he notes that "food standards remain aligned to the EU", and thus considers that the controls are "a pointless exercise".

The man seems to be so isolated from reality that Michel Barnier's caution obviously hasn't registered – that in leaving the EU and the Single Market, we are stepping outside the "regulatory ecosystem". Does not Norman realise that alignment with EU regulations is just the basic requirement for export? To be exempted from border checks requires much more.

But even without that, does he not realise that WTO rules require non-discrimination in the treatment of third countries. Without there being a specific "veterinary agreement", the EU must carry out the same checks on UK goods as it does on goods from any other third country.

On a broader level, his company enjoyed the ability to export fresh products such as sandwiches to his shops in other EU member states as a result of the UK's participation in the Single Market, a function of our EU membership. Does he seriously think that alignment with EU rules is sufficient to retain access to the Single Market?

The irony is that M&S has a reputation for maintaining the highest standards of food safety in the business, often imposing requirements on its suppliers that exceed statutory requirements, including requiring them to submit to additional, company-mandated inspections.

He is the very last person in the world to complain of "a fandango of bureaucracy", when doing business with M&S is far more onerous than having to deal with (by contrast) the relatively modest requirements of the EU.

The intervention of Norman (once again) into the Brexit debate, though – and the almost reverential treatment of this "prestige" figure by the legacy media – illustrates the low quality of the discourse, and the difficulty in settling on the relevant issues.

By now, one would have thought, it would have been understood that border controls are here to stay, and the need is to tailor trade patterns accordingly. That includes recognising that much of what was commonplace while we were in the Single Market will no longer be feasible.

As to the other side of the coin – whether the UK should delay the implementation of its own border checks – there is an indication that there is no great enthusiasm for this idea.

Predictably, NFU representative Nick von Westenholz – whose members stand to benefit from the imposition of controls – opposes a delay. It would "do little to address these problems, nor the long-term trade frictions we are experiencing", he says.

The Food and Drink Federation (FDF) takes the view that the big importers such as supermarkets are already prepared for the checks. On balance, a delay will only help small food suppliers in France, Spain and elsewhere in the EU who are not ready to handle the extra controls.

FDF chief executive, Ian Wright, says: "Most of our members who do this stuff regularly have done an enormous amount of work on this and invested really considerable sums in training, in getting new relationships with customs agents and in personnel. That’s all going to be wasted to some degree if it doesn’t start on 1 October".

The Guardian then tells us that sources at high street retailers have conveyed to the government that delays "would not be helpful as they would add more uncertainty".

The source also says that a delay would mean, "there will be an asymmetric relationship for British business where we are doing all the work on exports and paying the costs while EU business don't have any of these checks or costs". The government, he says, "has been telling us firmly for the last six months there will be no changes, so its credibility is on the line here".

However, while reports within the industry say the government seems to be divided on the matter, there is evidently more to this than meets the eye. The Independent is running a story which suggests that some of the ports are simply not ready to carry out the necessary checks.

This does not apply to all ports, by any means, but some are complaining about the lack of guidance about where different kinds of goods will need to be brought into the country. Others say they are struggling to physically build the infrastructure needed for the checks, because of global supply chain shortages for building materials and labour.

One of those ports is undoubtedly Dover, where the extra staff needed have yet to be recruited and trained, and where planning permission for new buildings has not been secured. Even if the government wanted to go ahead, therefore, the mechanisms for carrying out checks uniformly throughout the country simply to not exist.

The problem seems to be exacerbated by the inability of government to set out details of what foods and other products each of the border control posts should handle. The lack of clarity throws out the plans of both businesses and port health authorities – which must plan staffing levels and provide sufficient facilities.

Given that the requirements have been on the cards ever since Mrs May's Lancaster House speech in January 2017, that the preparations haven't already been made is a serious indictment of this administration. There has been plenty of time to get things sorted and we should not still be messing about.

The same goes for the fool Frost, and his Northern Ireland protocol, which continues to cast a shadow over relations with the EU, and hamper the rational implementation of border controls.

Currently, he is threatening to suspend the protocol unless the EU takes his renegotiation proposal "seriously", based on his earlier command paper.

This is another instance of people in high places who seem unable to grasp the basics. There must come a point when the EU finally loses patience, and the issue comes to a head, but there is no value in trying to predict events or second-guess any of the players.

Obviously, the longer this drags on, the greater the uncertainty and the more damage caused, but with all the other issues mounting for this government, Brexit may end up being the least of our problems. It nevertheless remains disturbing that the "top people" seem to be in a world of their own.

Also published on Turbulent Times.

Richard North 14/09/2021 link

Brexit: empty shelves or full coffins?

Monday 13 September 2021  

In my piece on port health inspections last week, with border checks of SPS products entering the country from the EU due to start on 1 October, I speculated briefly on the effects of a delay in introducing these checks.

The issue here is that local authority port health services, up and down the country – which actually carry out these checks – have invested a considerable amount in expanding and training their inspection teams.

And, while local authorities have had some financial help from central government, especially in covering the capital costs of building or enlarging border control posts, ongoing operational costs have to be met from fees charged to the importers of goods.

It follows, I wrote last week, that if the government doesn't go ahead on 1 October with the border inspections, it will dump unrecoverable costs on local authorities; they will still have to bear the employment and other operational costs or running the services, but will have no fee income to cover them.

Unless the government agreed to cover these costs, port health authorities might find themselves having to shed staff, making large numbers of newly-appointed inspectors redundant. Then, by the time the regime is reintroduced, there may be no authorities available to run it, as it would be extremely difficult to recruit new staff.

Now, it transpires, the government is seriously considering suspending the checks (with the Telegraph insisting on calling them "customs checks", which they are not).

Amid concerns that the checks "will fuel further disruption to goods flowing across the Channel and hammer consumers with higher prices", we are told that senior UK officials have confirmed that a decision to delay the checks is now "highly likely".

One suitably anonymous "senior source" states that an announcement is expected imminently, with a range of options being considered. One of those is a delay of six months or more.

There appear to be, though, splits within government over the mooted postponement. Some officials are said to be convinced that another extension will merely prolong the uncertainty for businesses and prevent them from adjusting to the reality of post-Brexit trade.

However, it seems that concerns over the impact on the supply chain may prevail. To that affect, the Telegraph offers a "comfort quote" from Adam Marshall, former director general of the British Chambers of Commerce. He obligingly tells us that: "From a whole economy perspective, given the supply chain crisis and the inflation pressures, delaying friction on imports means no additional transport costs, no additional price pressures from that".

Another senior business figure is called in aid to add: "I wouldn't be surprised if they delayed, given the pressure it is going to put on supply chains coming into the country".

Meanwhile, a third says: "I don't believe we're going to be ready for the disruption to the supply chain. We’re still going to want to eat salami next year. There's so many things that will be disrupted if we do it straight away". He adds: "It would probably be in the interests of the consumers of the UK if the SPS controls were delayed into 2022".

Nevertheless, the Telegraph does note that delaying the new checks is likely to provoke a backlash from UK exporters. They have been forced to comply with the full suite of SPS checks when sending goods into the EU.

Many have been worried about the competitive disadvantage between British exporters and their EU competitors. One business figure complains: "It is an unfair and asymmetrical situation and it's not right. It's not a position that can stay in place indefinitely".

Nothing is said, though, about the adverse impact on local authorities – possibly because the Telegraph doesn't even realise that the checks are carried out by council port health services. But collectively, even if the checks are delayed only for a further six months, they stand to be out of pocket to the tune of several million pounds – the shortfall having to come from the same budgets which fund social care.

But, in terms of "backlash", this may be the least of it. It can surely be only a matter of time before people start realising that we are importing foods and other goods from EU member states, which are produced to standards over which the UK has no control, and sometimes very little information – as we are now excluded from the EU's surveillance systems.

And while the assumption is that the food sent here is produced to rigorous EU standards, monitored by European Commission officials, this has not always been the case, and we have no means directly of ascertaining whether standards are being enforced.

This is illustrated by reports in Dutch newspapers at the beginning of this month, about the conduct of the Dutch Food and Consumer Product Safety Authority (NVWA) over the standards maintained by the Belgian-owned meat products company, Ter Beke, operating under the Offerman banner, from a factory in Aalsmeer, 13 km to the south-west of Amsterdam, close to the famous flower market.

Although the plant has since closed, in 2019 it was implicated in a serious Listeria outbreak from which 35 people became seriously ill, six people died and two pregnant women had miscarriages. Although the outbreak was notified by the European Food Safety Authority, it didn't name the companies involved, even though they supplied the Aldi supermarket chain, which trades in the UK.

But, from de Volkskrant and other Dutch media, that prior to the outbreak, it emerges that the NVWA had repeatedly told Offerman to cease applying over-long shelf life code to their products – a significant issue in listeriosis control, where the bacteria can grow slowly under refrigerated conditions.

In 2016 and 2017, the NVWA had rejected several shelf life studies from the meat company. Offerman, for instance, stated that its luncheon meat could be stored for 31 days without properly substantiating the claim. The NVWA maintained a shelf life of 21 days was more appropriate.

With the problem unresolved, though, after 2017, the NVWA responded by temporarily ceasing routine checks. Subsequently, it claimed insufficient capacity, that it was "too busy"' to carry out re-inspections and needed to concentrate on "other priorities".

Only in September 2019, just before listeria outbreak became public, did the NVWA resume checks, when the company was still applying use-by dates that were too long. It was fined for multiple offences and, the same year, listeria bacteria was found on cutting machines, in drains and on the walls of the company's premises. Salami, roast beef and chicken breast that had been processed in the Aalsmeer factory were found to be consistently contaminated with the listeria bacteria. Millions of product packs were recalled, including ham and chicken fillets.

Offerman was again fined but the company still considered renovating its affected cutting rooms. Then, it was found that listeria was lodged in the walls and the cost of cleaning and decontaminating them turned out to be too high – saying a great deal for the standards approved by veterinary inspectors. The factory has now been permanently closed, with the loss of sixty jobs.

Adding to the detail, the regional newspaper, de Limburger (no link) pointed out that staffing in the NVWA had been cut considerably under former CDA ministers Veerman and Bleker. In addition, the regulator had been transferred from the Ministry of Health to Economic Affairs in 2003, as a result of which inspectors often had to deal with conflicting interests between food safety and the economy.

Since then, the functioning of the NVWA has often been criticised. In the past two years alone, multiple damning reports have been published: in slaughterhouses, NVWA vets have been allowing improper practices without intervention, complaining of intimidation. Supervision of pig exports has been sub-standard, with vets allowing the transport of sick and lame animals.

Last year, Deloitte was asked to investigate the regulator and concluded that the NVWA cannot cope with its workload and is failing in two thirds of its tasks, risking both food safety and animal welfare. In addition, the organisation is ridden with internal struggles.

In this country, through 1988 to 1990, we had our own Listeria "scare", which had a massive and long-lasting effect on the conduct of food safety controls, including the transfer of responsibility of policy-making from the Ministry of Agriculture to an "independent" food safety agency.

Since the turn of the century, the UK had been increasingly reliant on the EU for its food safety policy, with veterinary inspectors and their fabled coloured crayons. But the Offerman outbreak is by no means the only food scandal to affect EU-produced food, with memories of the 2013 horsemeat scandal still fresh.

Now that we have left the EU, if Brexit is to mean anything, the UK should be insisting on border inspections to protect us from unsound EU-produced food, and systems which seem incapable of maintaining basic standards. When it comes to disrupting the food chain, sooner, one might say, empty shelves than full coffins.

Also published on Turbulent Times.

Richard North 13/09/2021 link

Energy: April comes early

Sunday 12 September 2021  

If it wasn't for the fact that we are becoming steadily immunised to the absurdities which beset modern life, a story in the Sunday Times on electric car charging points could easily be mistaken for an April fool joke, except for the minor detail that it's come more than half a year too early.

The gist of the story is that under new regulations, due to come into force in May, electric car charging points in people’s homes will be pre-set to switch off for nine hours each weekday at times of peak demand, from 8am to 11am and 4pm to 10pm.

The precaution is being taken because ministers fear that surges arising from electric car owners plugging in when they come home – or topping up before they leave for work – might over-stress the National Grid and cause blackouts.

The government, we are also told, is also taking powers to impose a "randomised delay" of up to 30 minutes at other times to avoid pressure on the grid if there is a scramble among motorists to recharge their batteries at the same time.

These restrictions are tucked into same regulations which will require all new homes and offices to be fitted with electric car chargers, with industry bodies saying that 700 electric car chargers need to be installed at homes each day to meet demand, but currently only around 500 are being added each month.

Thus, we have the bizarre situation where the government, on the one hand, is to force people to fit home chargers while, on the other hand, restricting their use. And then, there is the "vehicle to grid" provision, where the National Grid can suck the juice out of car batteries when the windmills stop turning, which could leave many drivers with no power at all.

For many people, though, this will not be a problem. As long as they are stereotypical plebs who conveniently work nine-to-five jobs, and are obediently tucked-in overnight, charging their cars as they sleep – provided they have off-street parking – the limitations should not present a problem. Pity the people with non-standard lifestyles.

Nevertheless, the government clearly realises is has what it believes to be a "perception" problem, having last week published on its website a propaganda screed entitled: "Common misconceptions about electric vehicles".

This starts off by addressing the most serious concern of EV drivers – potential and actual – that the cars "don't have the battery range to travel as far as people need". The "reality" says our wise and beneficent government is that 99 percent of journeys in England are under 100 miles. Therefore, we are assured, "most drivers' needs are easily met by an electric car".

For those pesky plebs who insist on driving further in one session, we are happily advised that there are "over 20 models available with a quoted 200-plus mile range". Some new electric cars, we are told, "come with a range of over 270 miles, enough to get from Southampton to York".

What we are not told, of course, is that the longer-range models cost considerably more than the basic "utility" versions and, as I wrote back in August actual range (as opposed to posted figures) varies according to conditions.

Factors such as ambient temperature, battery state of charge and condition, driving style, vehicle payload, vehicle electronics, heating and climate settings, can all reduce range, and driving on a cold night, with lights and heater on, can cut the range by as much as 60 percent.

Assuming 200-mile journey, even for those lucky enough to start with a fully-charged car, that means at least one, if not more, stops to re-charge on the journey. But, for those concerned with how long this might take, the government is nothing if not reassuring.

"Most charging", it says, "will be done at or near home overnight". Thus, it implies, the amount of time it takes to charge doesn't really matter. But if you are rash enough to risk a long journey, it tells us: "new cars are typically capable of charging up 120 miles or more in as little as 20 minutes – the time it takes to enjoy a cup of coffee".

You know it is a million miles away from reality when it uses the word "enjoy" in relation to motorway service station coffee, especially as this chirpy optimism doesn't take account of a Friday night when hundreds of thousand of motorists are all setting off at the same time to travel long distances up and down the nation's motorways.

When we used to live in London, my wife and I used to travel up from Croydon at least once a month to visit her folks in Yorkshire. Originally, we had a Hillman Imp which, coincidentally, had a range of almost exactly 200 miles. With a partial tank after a day's driving at work, we would top up at Hendon, just before joining the M1, and just about make it to Boroughbridge, driving on fumes, filling up again to complete the journey.

Even at 20-minutes a charge, that would add an hour to the journey. But. on a Friday night, we could be waiting ten minutes in a queue for petrol. Does the government have any idea what the queues are going to be like for working EV charging points, once the 14 million electric cars forecast for 2030 are on the road?

But never mind. At least, says the government, you're going to save money. EVs do cost more to buy outright today, it concedes, but "they already benefit from a huge advantage in running costs: as low as 1p a mile for off-peak electricity and far fewer moving parts, so much lower maintenance costs".

Already, in a number of cases, it says that EVs have a lower total cost over four years. Further, owners of EVs don't pay Vehicle Excise Duty and new cars under £35,000 are eligible for a government grant of £2,500. Vehicle manufacturers, including BMW and Nissan, have even reduced prices of electric models to under £35,000 to qualify for the grant.

Clearly, though, our government is not telling the whole story. As the Sunday Telegraph obligingly points out, the government's commitment to phase out petrol and diesel cars and vans by 2030 will leave the Treasury with a £40 billion black hole.

The head of the Climate Change Committee (CCC) is saying that the Chancellor will make "sweeping changes" to transport levies to raise revenue from battery-powered vehicles, not least the £28 billion generated from fuel duty.

Motoring taxes account for 5 percent of total government revenue, which will create a huge problem for the chancellor if people do as expected and buy into the electric car schtick – assuming they have any choice.

One option being considered by the Treasury is a road pricing, or "pay per mile", system, but nothing here is being said of a rather embarrassing elephant in the room. To manage a universal road charging system, a high-accuracy, secure GPS system is needed.

Such a facility could be afforded via the EU's Galileo system – which was the real reason for which, many of us suspected, the system was designed. But, rather inconveniently, with Brexit, we have dropped out of this facility and it will not be available for any UK road charging scheme.

Nevertheless, there will be a revenue "black hole" and the government will have to fill it. Electric vehicles will not remain tax-free for long. No chancellor can afford to let such an easy target go free. A way will be found to load costs onto the electric driving experience.

As time goes on therefore, Johnson's 2030 electric fantasy looks more and more unrealistic. But if the real agenda is to drive the average pleb off the road, leaving more room for ministerial chaikas, then his policy is on its way to being an outstanding success.

Also published on Turbulent Times.

Richard North 12/09/2021 link

Afghanistan: a graveyard of experts

Saturday 11 September 2021  

On the 20th anniversary of 9/11, the subject of the situation in Afghanistan again climbs into prominence, and more so with an article in the Guardian by Jonathan Powell, Tony Blair's former chief of staff.

Using that event of 20 years ago as a hook, he argues that the lesson we failed to learn from 9/11 is that "peace is impossible if we don't talk to our enemies". "We should", he says, "have engaged with the Taliban 20 years ago, but we thought the winner takes all", adding that this failure "undermined our own armed forces".

This is a thesis much favoured by prominent, US-based journalist and author, Anand Gopal, who asserts that, after the US invasion of Afghanistan, when the Taliban government was crumbling, some of the chief lieutenants of Taliban leader Mullah Omar secretly gathered and decided to surrender to the forces of Hamid Karzai.

Some of the Taliban members even saw the new government as Islamic and legitimate, and some senior Taliban officials even surrendered to Afghan authorities in early 2002.

But, Gobal records, Karzai and other government officials ignored the overtures - largely due to pressures from the United States and the Northern Alliance, the Taliban's erstwhile enemy. Moreover, some Pashtun commanders who had been ousted by the Taliban seven years earlier were eager for revenge and were opposed to allowing former Taliban officials to go unpunished.

Widespread intimidation and harassment of these former Taliban ensued. Sympathetic figures in the government told former members of the Taliban that they should flee the country, for they would not be safe in Afghanistan.

The men eventually vanished across the border into Pakistan's Baluchistan province, many later to become leading figures in the Taliban insurgency, playing an important role in rallying the scattered Taliban remnants to rebel against the Americans.

Thus, the narrative goes – picked up and amplified by Powell - if only the US had been disposed to talking to the Taliban, and perhaps offered key members of the movement places in the Karzai government, this would have nipped the insurgency in the bud.

As Powell puts it, "Instead of engaging them in an inclusive process and giving them a stake in the new Afghanistan, the Americans continued to pursue them, and they returned to fighting".

Seductive though this thesis is, and endorsed by many prominent members of the Afghan commentariat, the suggestion that insurgency would have been avoided is nonetheless entirely speculative. However, there is a tendency to play the "prestige" card, to the extent that the prominence of some of its advocates tends to afford it a level of credibility not warranted by its speculative status.

Much of the prestige attaches to members of the so-called Afghanistan Analysts Network (AAN), the go-to source by the media, for much of its information on Afghanistan.

However, while its members pronouncements are often treated on a level akin to papal infallibility, it is well to be aware that they too, on occasions, have feet of clay. One such is Kate Clark, former BBC journalist who was stationed in Kabul 1999 and has covered the country's affairs on and off, ever since, joining the AAN in 2010.

On 1 May 2021, Clark had published by her employer a paper entitled, "As US troops withdraw, what next for war and peace in Afghanistan?". There, she concluded:
… the US is leaving Afghanistan after 20 years, with a negotiated end to the war looking the least likely scenario. More probable is that the Taleban will, sooner or later, move to try to capture territory and attack Afghanistan's provincial capitals. Yet, the likelihood of the movement taking power through military victory also seems remote. The Taleban show every sign of having underestimated the ANSF. There is every prospect that any Taleban drive to intensify the violence will be resisted, with immense suffering to countless Afghans.
Then, on 1 August, as the Taliban were taking more and more provincial capitals, she was telling Channel 4 News: "It's by no means over … I would say the next few months are crucial". Two weeks later, the Taliban had strolled into Kabul and president Ashraf Ghani had fled the country.

Nevertheless, the AAN does produce some good analytical work, even Anand Gopal who, with Alex Strick van Linschoten, in June 2017 produced a paper entitled "Ideology in the Afghan Taliban". This augmented another report, written by Thomas Ruttig, written in April 2010, entitled, "How Tribal Are the Taleban?", with the sub-heading, "Afghanistan’s largest insurgent movement between its tribal roots and Islamist ideology".

This earlier report is particularly interesting because Ruttig writes, amongst other things, that in the Taliban, there are three different types of network: religious; political and tribal. In any given situation, he says, individual Taliban – leaders as well as fighters – can choose from these networks in any given situation, when mobilisation, support, solidarity, etc. is needed.

Gopal and his co-author stress that the Taliban is primarily a Pashtun-based organisation, with its structures and mores reflecting their tribal composition, overlaid by these political and religious influences.

From these and a galaxy of other authors we get reminders of the egalitarian nature of Pashtun tribesmen, the lack of a hierarchical structure, and the inability of tribal chiefs and elders to exercise control over their tribes, particularly when under the influence of religious leaders who have declared a jihad.

One wonders, however, whether the august authors of the AAN fully understand the practical implications of their own work, which tends to indicate that, amongst Pashtun and therefore Taliban leaders, there tends to be a strong element of followership. They either go along with their members or they may be ignored or, at worse, violently deposed and replaced.

The point that emerges from this is that, just because Taliban leaders agree to a course of action, that does not mean that members will follow them, or that the leaders have any way of enforcing their decisions. And, as we have so often seen in such tribal affairs, members who disagree with their leaders commonly set up or join rival groups – or form their own.

A propos the Gopal/Powell thesis, therefore, there is no good cause to argue that, if in the immediate aftermath of the US invasion in 2001 some Taliban leaders had sued for peace, their members would necessarily have followed – especially as the Taliban is by no means a homogeneous organisation.

Something of this dynamic we are seeing between the Taliban of today, and the ISIS-K, where any relaxation of the zealous application of the Sharia code is likely to be met by mass desertions to ISIS-K – most of its membership having come from the Taliban in the first place. The Taliban could find themselves deposed by their own bastard child.

Whatever does happen, in my view there is only one certainty – so complex is the situation in the region that any attempt to second-guess the outcome, past or present, is bound to be frustrated. Afghanistan has been called the "graveyard of empires". That is a disputable proposition but it is certainly turning out to be a graveyard of experts.

Also published on Turbulent Times.

Richard North 11/09/2021 link

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