The UK’s economic “growth” is an unsustainable fantasy founded on a credit and consumption bubble. Long before the completion of Hinkley C, economic failure and fossil fuel depletion will bankrupt the Government’s energy policy, based on 6%-10% annual rises in energy prices. Degrowth is the only viable policy.
Six years after the crash of 2007 the UK economy is now growing at its fastest pace for over three years, but it's only the service sector that has actually recovered from the recession. Industrial production has contracted by 12% and is now 15% below its pre-crash peak. Construction dropped by almost 20% and is still 15% down even after a recent upturn. The balance of economic activity between sectors and regions is now even more off-kilter than it was before the financial crisis.
Not only is GDP growth based on a flawed economic model, dependent on cheap credit, rising debt and a temporary fall in food and commodity prices, but economic data collected from 1972-2000 confirms the Club of Rome's "Limits to Growth" report predicting collapse of the global system midway through the 21st Century. The economy, and especially the poorest groups in Britain today, won't be able to stand the long-term indicators of where energy and economic trends are ultimately heading under current growth-based development models, which in ten years time will effectively double the price of power.
As environmental energy expert Paul Mobbs explains:
"What DECC has enshrined in the subtext of the contract for Hinkley C is an abandonment of any allusion to conventional 'econometric theory' within their energy demand and price forecasts5 – making a mockery of their assertion to have any control over energy markets in general through fiscal or technological measures. They're just "going with the flow" of where the demand-driven market trends are heading.
Quite simply this contract prices future power within the bounds of the expected, depletion-driven present trends to insure a return on EdF's/China's investment at today's capital rates. That's absurd in any case given that local6 and global7 inflation rates, and shortly-to-rise UK8 and global9 interest rates7, are likely to knacker the capital discount model underpinning the economics of the build10 (basically they'll be back for more money11 in about five or six years time when it's half-built!). And what's forcing those prices to rise is not the costs of nuclear (it's still a minimal component of the overall price – and highly intermittent due to shutdowns). It's the depletion of other fossil fuel sources12 which are driving up prices, and that in turn drives power generation costs. And unless we talk about depletion13 as a key factor in current decision making – which DECC/politicians generally will simply not do – then you can't present a rational basis for a whole range of decisions they're taking today; from fracking to new nukes.
There is one strategy which CAN get us away from the fundamentally unsustainable trends which are driving the failure of our current economic process - DEGROWTH."