Bursting the Bubble of Carbon Finance

The idea of a carbon bubble first came to my attention when I was researching a submission to the Environmental Audit Committee's Inquiry into Green Finance on behalf of the Green House thinktank. Anmongst other questions they asked:

'How effective are the financial markets in matching available finance to the required investment in renewable energy and other green projects? To what extent is a potential “carbon bubble” a real risk?'

They referred those providing evidence to a page from the seemingly well funded Carbon Tracker project which seeks to quantify the over-valuation of what they refer to as 'stranded assets'. The project seeks to put a value on the carbon-related assets that cannot be realised if we seriously address the issue of climate change. Once we introduce rigorous carbon limits the fuel their value relies on becomes unburnable and therefore the value is lost. Carbon Tracker reports frighteningly large numbers of potentially stranded assets: they take a value of $4trillion in 2012 that is used servicing $1.27trillion in outstanding corporate debt.

The frightening way of framing of this discussion is that once the over-valuation is recognised it could precipitats another collapse in financial markets and another financial crisis. This always seemed to me hugely naive suggesting that the rich and powerful who control these assets would permit political decisions on climate change to destroy their value. It was in this vein that I responded to the EAC inquiry:

 

'The idea of a "carbon bubble" assumes that legislation passed in the wake of concern about climate change to limit carbon dioxide emissions is more powerful than the political influence of fossil-fuel companies. While we would like to believe that this is the case we suggest that it is a rather naive position. Is it not more likely that, if energy companies find themselves with quantities of fuel that cannot be burned within existing carbon limits, they lobby to have those limits changed rather than allowing their investments to be diminished? We suggest that the EAC is in a strong position to generate evidence on this to prepare for such lobbying.'

Then I simply forgot about the debate. What brought it to my attention again was the machinations of self publicist MP Jacob Rees-Mogg and the internal Tory party debates about green crap and green levies. As I blogged earlier, it seems fairly apparent that the concern of Tory grandees is for their own assets and not shivering pensioners. Here we see the playing out of the political end-game of climate change. The post-fossil world is one of community-owned energy and economic liberation, so there is no surprise that climate change is a battle based in political economy rather than science.

The discussion about the carbon bubble issue has become a dialogue of the deaf between holders of carbon-related assets and those who are fearful about The Financial Crisis round II. How refreshing it was, therefore, to be at the Compass Youth meeting on this issue at Portcullis House last week. Although the meeting itself was advertised in a fairly scary way, through debating the issue we discovered that in reality we may not be facing a catastrophic economic collapse but an orderly transition to a post-fossil future matched by a gradual reduction in the value of carbon-related assets.

In a strange way it is even encouraging that Bloomberg recently launched their carbon risk valuation tool. Investors and those who serve them seem unconvinced by the Tories' dinosaur protection plans and appear to see the wind is blowing in the direction of renewables. And we can all play our part here by encouraging those who hold our assets, whether our pension funds, universities, or local authorities, to divest from carbon assets just as they have or should have divested from assets relating to tobacco, alcohol and arms.

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Ecodynamism Alive and Well in Stroud

A change of focus away from the world of global financial exploitation and towards local investment to develop resilience and build the green economy in our communities. A new renewable energy co-operative was born in Stroud on 25 January, when Ecodynamic's founding Community Share Offer was launched, appropriately enough in our local micro-brewery Stroud Brewery.

Ecodynamic has been founded in association with the Biodynamic Land Trust, as an anchor investor, to reinvest surpluses from renewable energy into sustainable food projects. Ecodynamic is seeking to raise £350,000 by 22nd March to purchase and run a new 55KW Endurance wind turbine in Cornwall. Shares have a projected annual return of 3% rising to 5% after year three over the 20 year life of the project. Greg Pilley said at the launch, ‘I will invest £1,000 in Ecodynamic to keep the local community investment revolution fermenting for renewable energy generation.’

Ecodynamic is applying to HRMC for EIS relief, which if successful, will allow UK tax payers to get 30% tax relief in year one, so a £1000 investment will attract £300 tax relief, if EIS is approved. As a mutual organisation, all members will have equal votes in how the society is run and what projects will be supported.

Founding Ecodynamic director Martin Large, (who set up Fordhall Farm’s pioneering charitable co-op structure in 2005-6, and who is a director of Stroud Common Wealth) says that, ‘Ecodynamic offers the attractive combination of both getting interest on your investment in a community energy project, which is backed financially by the government’s Feed in Tariff , and also reinvesting any surplus into viable food and energy projects.’

Ecodynamic directors are experienced in business, co-ops, renewable energy, farming, banking and finance. Ecodynamic respects co-op principles and has a vision to create a ‘co-operative turn’ towards a sustainable social economy, just like the West Mill Co-op. James Mansfield, also a Director, said ‘I see Ecodynamic as having tremendous potential to contribute to our society’s present and future wellbeing, by reinvesting surpluses from renewable energy projects into sustainable, biodynamic and organic food production.’

If you have some money to invest and you would like to see it used to build resilience into our local economies you know where to go.

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Bristol Green Deal

The election of an independent  mayor in Bristol offers opportunities for truly creative policy-making. In this guest post Chris Cook, a former market regulator in futures and petroleum markets and now senior research fellow at UCL, suggests a novel financing mechanism for funding a rapid expansion of Bristol’s renewable infrastructure as one step on the road to what he calls a ‘natural grid’.

One of the key objectives of any 21^st century political administration – and Bristol is no different - is how to achieve energy independence and energy security by becoming as self sufficient in energy as possible. Energy independence for Bristol can be achieved in two ways: firstly by investment in Bristol renewable energy, and secondly, by massive investment in energy efficiency.  21^st Century problems cannot be solved with 20^th century solutions, but the irony is that the radical funding solutions leading to energy independence may be found prior to the advent of modern banking in1694.

Prepay 1.0

It has been long forgotten, but for many hundreds of years British sovereigns financed their expenditure though issuing undated IOUs – at a discount enabling a profit - to creditors who provided value in exchange. These IOUs were returnable in payment for taxes and that part of the wooden 'tally stick' record issued to a creditor as a token of the IOU was known as the 'stock'.

Interestingly, the phrase 'rate of return' describes the rate at which the creditor could generate his profit by returning his IOU/stock to the Exchequer for cancellation.  The more tax he was due to pay, the quicker was the rate of return of the stock.

Now, while the idea that the mayor's administration might fund itself by issuing prepaid rates 'stock' at a discount in this way is a fascinating one, it happens to be illegal, and this proposal is rather more pragmatic, being achievable immediately, with no change in any law.

Prepay 2.0

Both renewable energy and energy efficiency are free.  Clearly, if renewable energy or energy savings can be packaged and sold to investors at the right price, then necessary capital investment can be funded. But there are several problems with conventional sterling (£) funding of renewable energy.

Firstly, compound interest on bank borrowings: a debt doubles in 10 years at 7% compound interest.  Secondly, electricity is sold at a low price to a wholesaler, who makes as much profit as the regulator permits when selling to retail customers. Thirdly, the high rates of return demanded by investors in respect of shares in Victorian vintage 'Joint Stock' Limited Liability Companies. 

Then, to add insult to injury, because most renewable energy development is by foreign owned companies, most of these fat profits from UK renewable energy are hoovered out of the UK. So, let's put renewable energy investment to one side for the moment and look at the low-hanging fruit: massive investment in energy efficiency – or a Bristol Green Deal.

The Gas Pool

The Gas Pool will be a fund, administered by an ethical and competent provider of financial services such as Triodos Bank. The proposition for Investors is that they may buy units in the Pool, and that these units will be denominated, like their gas bill, in MMbtu's of heat energy.  So investors may invest directly in the value of natural gas. However, in addition to only being able to sell units conventionally (or unconventionally)  to other investors they will also have the 'stock' choice of returning their units in payment for gas bills.

Note here that in the US there are billions of dollars invested in natural gas and other energy funds by investors who observe zero% interest on Treasury Bill investment, while the Federal Reserve Bank prints new dollars massively.  These risk averse 'inflation hedger' investors do not seek a return on their capital: they simply seek a return of their capital.

Gas Loans

The Bristol Gas Pool will invest – alongside the existing Green Deal and complementary to it – in 'micro' level energy saving investments in homes and the resulting 'Gas Loans' will be repaid as occupiers buy back units in the Gas Pool at the gas market £ price via their gas bill.

The conventional bank debt funded Green Deal suffers from two flaws: firstly, compound interest at perhaps 7%, and secondly, the behavioural problem that even though people may save £ there is no guarantee they will save energy. However, with Gas Loans, there is firstly no compound interest, since the return to investors is in the energy value of gas, and secondly unless occupiers use less energy then they will not save £. With the right legal and financial structure, such a Bristol Green Deal could be introduced tomorrow.

A Natural Grid

But of course, investment in homes addresses only part of the problem.  The UK needs a least energy cost 'Natural Grid' which is complementary to the 'least £ cost' National Grid currently festooning the country's beauty spots with pylons. Denmark leads the way here, both with retrofitting 'macro' infrastructure (eg Copenhagen's 150km hot water grid) and with massive 'bottom up' investment in community level heat infrastructure, such as combined heat and power, and heat storage.

Such macro and 'meso' level investment in Bristol – such as a network of community level modular Combined Heat & Power installations- may be funded using similar techniques. But exactly how that works would be - like resolution of unsustainable Bristol property debt using similar investment techniques – for another radical Bristol policy story.

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Demand Clean Energy

A guest post by Friends of the Earth’s Energy Campaigner Paul Steedman

Renewable energy firms, campaigners and Ministers from all over the world waiting for a long over-due keynote speech on the environment were left feeling somewhat deflated last week, as the Prime Minister’s talk at the Clean Energy Ministerial fell far short of expectations. In a speech lasting just seven minutes, Cameron talked up Britain’s natural resources without actually announcing anything new. He said that clean energy, fossil fuels and nuclear would all have an important role to play in future. And in a nod to the Chancellor he stressed that the cost of renewable energy must fall – without setting out ways to drive the investment that’s needed.

David Cameron knows the idea that clean energy is antithetical to a growing economy and a thriving business sector just doesn’t stand up – our full page ad in the FT last week pulled this argument apart. Renewable energy is one of the few sectors growing while the rest of the economy stagnates. New research by the REA shows that the renewables industry already supports 110,000 jobs across the supply chain. The Offshore Valuation says that using just one third of the UK’s wind, wave and tidal resource could create 145,000 more – developing this sector would allow us to export technology and expertise.

When the Electricity Market Reform Bill enters Parliament this year, Ministers will have a once-in-a-generation opportunity to change our broken power market for the better. It’s a chance to end the stranglehold of the Big Six energy firms keeping the UK hooked on expensive fossil fuels, and provide better support to new and smaller companies developing clean British power from our wind, sun and sea. That’s why Friends of the Earth has launched its Clean British Energy campaign, calling on the coalition Government to bin the ‘bad-for-business’ rhetoric and commit to clean energy and a low-carbon future.

Crucially, a switch to clean energy and greater energy efficiency will bring much-needed long-term relief to the pockets of hard-pressed bill-payers – energy regulator Ofgem says it’s our reliance on gas that has driven up fuel bills in recent years. With six million UK households struggling to stay warm in winter, the need to shift from costly gas towards renewable alternatives has never been greater.

If David Cameron is serious about driving down the cost of renewable energy and driving forward low-carbon growth, he needs to act fast. It’s been two years since we were promised the “greenest Government ever” – with the UK entering a double-dip recession, now is the time to deliver. 

Join over 7,000 people who have already taken action, and add your voice to the call for a switch to clean British energy at www.cleanbritishenergy.com.  
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Politicians Paint Themselves into a Market Corner

The shenanigans over the rate of the feed-in tariff is a good example of the way in which politicians have, in accepting the myth of the omnipotent market, limited their room for manoeuvre and made themselves incapable of taking the steps necessary to ensure social and environmental benefit.

We can argue about the appropriateness or otherwise of the 43.3p set by Labour for the rate of the feed-in tariff and whether it was just a deliberate banana-skin for the incoming Tory government, but the broader question of who should pay the cost is what really demands attention. The transfer of money uniformly via energy bills in a market dominated by an informal cartel and from those who can least afford to pay, towards those who have the spare resources to buy solar panels to install and would then receive the tariff was always a questionable scheme.

Imagine a world where the production and distribution of energy was in public hands - local government rather than national, ideally - and where the cost of energy rose as you used more, rather than costing most when you use least. The extra money charged to heavy energy users could be made available via grants to local people, or used to directly fund the installation of solar panels on the roofs of the tenants of social housing, who are least able to pay their energy bills. You have neatly created a just solution and simultaneously generated sustained demand for solar panels, reducing costs and making them available at a lower price to those who can afford to buy their own. This is a political solution, but it is hardly communism.

In the end this decision to set a price to underpin the development of a market for solar in the UK, immediately followed by a reversal, is bad for business too. It gives a mixed message which is exactly the opposite of the clear signal businesses need to make investment decisions. It will have negative knock-on effects in other areas, as managers doubt political commitment to the transition to a green economy.

As the myth of the market itself corners the market in ideas, we see the consequences in terms of inert and impotent politicians, and we all pay the social and ecological price.
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Green Queasing Gathers Support

Last year Colin Hines and Richard Murphy of Finance for a Future called for money to be into businesses helping us make the transition to a sustainable economy, a call which has been by Green MP Caroline Lucas and repeatedly on this blog. If we are to create money it needs to generate truly effective demand, not just disappear into banking black holes.

A recent post to Power Switch, the UK's peak oil discussion forum details how such a scheme might work. Meantime, more rhetorical support was offered by Tim Jackson during his presentation to the Schumacher centenary festivities in Bristol earlier in the month.

Meanwhile a useful piece of research commissioned by WWF indicates another important direction that manufactured money should be directed: towards transforming our energy grid towards sustainability. The report's encouraging conclusion is that:

'This report makes it clear that decarbonising the UK power sector by 2030 in an environmentally sustainable way that avoids reliance on risky nuclear technology and high levels of unabated gas is achievable without compromising the security of the UK’s electricity system.'
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Answers Still Blowing in the Wind

Technical reports about wind-power present a classic picture of statisticians dealing with the unpredictable. Aside from a helpful opening sentence in a BERR advisory note informing us that 'The UK is a very windy country' and a range of pseudotechnical concepts, it is hard to get accurate figures about how much of our electricity could realistically be generated from windpower. But what is fairly clear is that we have a lot of wind 'resource' availabile and, because we have a large Atlantic coast, the wind blows relatively more consistently here than in Denmark and Germany, which both have considerably more installed capacity than we do (Germany has 16.2% of the global total compared to our 2.6%).

This year's annual Ethical Consumerism Report indicates that spending on most areas of fair trade and ethical goods shows large increases (organic food is the exception), but the report's funders Co-operative Financial Services identify renewable energy an example of area that has 'failed to make significant progress'. So what is holding us back, and what can be done to break through these barriers?

Assuming that we are not going to have a government that will see this as an opportunity to create jobs and reduce our carbon impact and thus provide state investment to the sector, we will have to rely on a combination of good will and financial incentives. So in order for this market to take off we need what a technologically constipated economist might refer to as a 'triple coincidence of incentives'. We need the right sort of wind (fairly consistent and not gusty), where people consume large amounts of electricity and where there is spare capital for them to invest in the hardware.

In an earlier post I argued that the main hurdle to be overcome - the resistance of local communities to 'unsightly' windfarms in their vecinity - could best be addressed by a co-operative model but it seems that, even with the generous terms currently available via the feed-in tariff, we still do not have the right model to garner sufficient support to see the response from local communities that would enable us to match Germany's capacity over the next five years or so.

One disincentive for local communities is that cost of the environmental reports needed to get a planning application on its way, when the possibilities of success are still unknown. This might amount to £40,000 or so that must be found from local small investors, who may just be throwing their money away. What we need is a group of Public Interest Planners who can afford to do this work pro bono and, where this is relevant, provide templates for the parts of the reports that are not site-specific. A Community Renewable Energy Toolkit for England and Wales, along the lines of that already produced by the Scottish government, could also help the process.

But rather than knowledge or expertise it may be the financial engineering that is most necessary. On this front, I heard an interesting pitch recently from Tim Helweg-Larsen, formerly of the Global Commons Institute and now at the Public Interest Research Centre. His model, called the Energy Bank, connects well-intentioned investors with local communities in windy places, at least achieving a double coincidence. Whether this turns out to be more successful than the payments offered to smooth the path to planning permission in reluctant communities remains to be seen.
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Bonds Set Local Economies Free

How does anybody in a local economy go about finding the money necessary to make something happen? Whether a local business, community group or the council they are likely to borrow it. Local people, meanwhile, deposit their money in a local bank branch. In a rather murky process this is then sent to the ends of the earth—perhaps even Iceland or the Amazon. It may be invested in something we know nothing of and might well disapprove of if we did, or used to ‘leverage’ the creation of more money. So when I go to the bank to borrow money to do something good it has already been on an extraordinary journey.

This reminds me of how milk from the cows in the field next door goes first to a large milk-processing factory, then to the bottling plant of Dairy Crest in Nuneaton, the to the central distribution hub of a supermarket chain elsewhere in the country, then back to the supermarket shelf where I can buy it. You can’t help wondering whether it wouldn’t be simpler to just take a jug and hop over the fence. When it comes to money, a local investment bond is that jug.

Local bond issues are a great way of enabling people to invest safely in their local economy—while also seeing a good return on their savings. They operate in essentially the same way as borrowing for national public spending: a trusted local body issues a bond (it could be a local authority or community group), which it guarantees to repay after a fixed period, and in return it borrows money from a local person or institution.

The money gained is invested in local infrastructure, for example a wind turbine or programme to retrofit local houses to make them more energy efficient. There needs to be a revenue stream to enable the issuer to pay interest on the bond, and eventually to pay back the loan. In the case of renewable energy projects the introduction of the feed-in tariff can produce this revenue stream. Bond incomes can be paid by generating energy and selling it to the national grid. Although no local authorities in the UK have yet followed this course, it was the method used to fund the upgrade of London’s tube network by Transport for London.

Although a local bond does involve borrowing money and paying interest, it is a deal between local people where no value leaves the local economy and no middlemen benefit. By contrast, the Bloomberg (NB) website notes that the Conservatives are suggesting that local authorities will be free to engage in borrowing through using bonds to raise money from capital markets. Without the local link—and democratic accountability—this is a financial fiddle to allow borrowing without it appearing on the government’s balance-sheet. And to enable the private sector to profit from local economies’ need for investment. Tweet

Seeking In-Vestas in the Future

Our man on the ground at the Isle of Wight Vestas site (well, mostly up a tripod watching for coppers, as it happens) reports that the action to keep the wind turbines in this country is happening now and bodies are needed.

More information is avaiable from the workers' website Tweet

From Our Own Correspondent

An update from James Beecher on events on the Isle of Wight:

I said I was too busy to visit Vestas, but (un) fortunately for me,
the Big Green Gathering was cancelled at the last minute (seemingly a
political decision based on the links to the green movement, in
particular the climate camp).

Instead a few Bicycology people decided to visit the Isle of Wight
protest camp on the 'Magic' mini Roundabout outside the Vestas wind
turbine factory.

'Vestival' as it became known briefly is now a hodge-podge of the
Climate Camp with it's volunteer vegan kitchen, regular consensus
meetings and up-for-it experienced activists, mixed in with a healthy
dose of factionalist lefty groups (Workers Liberty, SWP, Socialist
Party) all doing a stirling effort to put ideological differences
aside and get down to what they do best (usually writing the leaflets,
rather than occupying the roofs of connected factories, but leaflets
are needed too!)

These elements of course combine with a large presense of Vestas
workers, many of whom have joined the RMT since being forced out of
the factory by the management. Unions were banned during there time
working in the factory, so it is a great symbol of defiance for them
to wear orange hi-viz RMT jackets, fly green RMT flags high, and
discuss unions in all their glory and grit.

Many workers joined the RMT becuase they appreciated it's helpful but
non-controlling approach. Many however, including the 6 remaining
occupiers, still feel no need to join a union - they stood up for
themselves anyway, after all, and are organising themselves very
effectively.

Of course, there are a myriad of other people at the demonstration.
There are local teenagers and children, enjoying the music, bands,
face painting and craft workshops that take place (including, the
other night, a bunch of boy racers who showed up to toot there horns
in support). There are local people of all ages in fact, up to a 70
year old man i spoke to yesterday about similar underhand tactics when
Enfield left the island years and years ago to mov e production to
china (then, as now, the workers in britain trained those who would be
given there jobs)

Simon Hughes has visited, and the local lib dem candidate is regularly
in attendance.

There are some notable absentees however. I met two green party
members during my time there, both involved in the Green Left bit. No
Green Party elected representatives have turned up, which means the
workers feel let down by the Green Party, despite their good words on
the subject. Similarly, although the local labour party candidate has
turned out and said helpful thing, Ed Miliband still believes the
fight is over, and he cannot do anything. As Seize the Day sing in
their song they wrote for the occupation, "he can come down here and
support us too" whenever he builds up the courage!
Bob Crow attended court, and spoke at the rallies at the factory early
on, but no other union officials have attended (despite many rank and
file members of unions such as the PCS, Unison, Unite, FBU and others
regularly attending, and bringing their banners).

Dale Vince put out a great press release, and I am hoping to get both
him and David Drew to visit, or at least provide me with a spoken word
recording to take to play to the occupiers and their supporters.
Please consider what you can do.

1. Visit the factory. The atmosphere alone is truly inspiring. Better
even that any climate camp i have been to.
2. Contact anyone in any network you are in who you think could
mobilise support or resources to help.
3. Don't fail to phone Ed Miliband every day and let him know what you
think of the government's environmental credentials
4. Send some money to the redundancy fund for the occupiers (who have
been told they will receive nothing, and will "never work for Vestas
again")
5. Be creative and think of your own solutions to the problem! Order a
wind turbine blade (they *are* 40 meters long though!), Ocuppy your
place of work in solidarity, go on strike, leaflet, get on telly -
whatever you can.

There are days of action called for this saturday and next wednesday.
This is the opportunity many of us have been waiting for to turn
climate change and capitalism around. Please be a part of the
solution!

Photos and more on Indymedia.org.uk, savevestas.wordpress.com, and
ventnor blog (including interviews with me and videos of the seize the
day song)

Love to you all, I have renewed belief that we can win - but we need
to step up to the plate...

James Tweet

Wind Power is Our Mutual Friend

Bob Crow, whose RMT union is representing the workers occupying the Vestas wind turbine factory on the Isle of Wight, asks with understandable frustration why money can be found to keep RBS afloat when the much smaller sum that would be needed to keep this industry of the future in Britain is denied. The answer is simple if unpalatable: the interests of business prevail over those of the people. We might say that capital is dominant and labour discounted.

From a green economics perspective we might look at this in different terms. Our current economy is dominated by money; a green economy would have energy as its central value. If you remove the distorting lens of a capitalist vision the decision to premit the redundancy of skilled workers who produce machinery that can turn moving air into energy is absurd.

It almost makes you join Bob Crow in yearning for the days when there was political direction over vital areas of public life, whether energy, water, or transport. Certainly, many whose own lives have been dedicated to the political freedom of others have looked enviously at the rapid progress towards a sufficiency economy that Cuba made following the ending of cheap oil imports from the Soviet Union. And China seems best placed to shift its economy rapidly towards a low-carbon future precisely because it does not have to worry about selling these changes to a sceptical electorate.

But the answer is not to sign away from our hard-won right to power over our lives, or to return to the days of public ownership and central planning, it is rather to call for ownership and control at the local level. Vestas offers a perfect example of how a mutual future would achieve the advantages of rapid change without the political opposition that arises when people feel they are powerless pawns in another move that is for the benefit of others.

It seems incredible that the market for wind turbines in the UK is too small to keep the plant in production. The reason is the slow rate of agreement on the siting of these desperately needed energy plants because of local planning opposition. Communities will not agree to having windfarms in their 'view' when the profits are extracted and they gain nothing in return. If the turbines are community owned, research indicates that this opposition evaporates.

And if Vestas central - and how strange it feels that the bad guys in this particular story are Scandinavian - has no need of this plant because it is receiving a better 'green new deal' from President Obama, then it should be passed on to the skilled engineeers and lathe-turners who are the heart of the company. Like the workers at Tower Colliery in South Wales, there is no doubt that they will be able to keep the factory going without the dubious skills of managers and money-men.

There are numerous reasons why capitalism is unsustainable but perhaps the most pressing is that, in pitting the interests of labour against those of capital, it slows the process of change. In a time when a rapid transition to a low-carbon economy is essential this could truly be a fatal flaw. As the new Co-operative advert says, the answer really is blowing in the wind. Tweet

Man Armed with Sausage Roll Arrested by Pigs

No, not an indication that her majesty's finest have taken a vegan turn, but rather a sign of the increasingly desperate nature of policing when the political direction of the country is entirely at odds with the well-being of its citizens.

Early evidence that the police are being used to defend the interests of capital (now frequently called 'business') was widespread at the policing of the G20 demonstrations in London in April. Given the shocking amount of public money that had been given to reckless bankers the level of restraint shown by protestors was admirable. The police failed to live up to this standard.

The latest flashpoint in the struggle between the people and the state is on the famously radical Isle of Wight. The Vestas factory near Newport is the country's only producer of wind turbines. Its closure was made public on the same day that the government announced a fivefold increase in the number wind turbines that would be operating in this country. So much for the Green New Deal. Money can be found for the banks but not for manufacturing.

If ever there was an industry that was worth supporting this has to be it. If we have a future at all it clearly belongs to the renewable generators. These are the skills and the products that will be part of our sustainable economy. But yet again hot air has won the day and there is no action to back it up.

The workers have taken affairs into their own hands and reclaimed the factory. They are being supported by protestors who are resupplying them with food, which the police are preventing them from passing on. Hence the sausage roll incident. The Times reports that the arrested man's custody sheet accused him of being 'armed with supplies of food'. Sausage rolls have now been elevated to the status of casus belli. These are the Climate Change Wars and we may have found the 21st century equivalent of the War of Jenkin's Ear.

A full report is available from Indymedia. Tweet