EU Plans Re-Industrialisation Of Europe

Chimneys of ThyssenKrupp’s steel works in Germany.Back to the roots: The European Commission has re-discovered industry as a source of wealth creation. It has vowed to create better conditions for investment in innovation and factories and wants to increase the rate of industrial added value in Europe. “The Commission expects to reverse the declining role of the industry”, according to a strategy paper on industrial policy which EU Commissioner Antonio Tajani will present on Wednesday. The share of industry in the EU’s Gross Domestic Product (GDP) should “be raised to 20 percent by 2020,” promises the policy paper. But that would signal a small revolution because the re-industrialisation of Europe and maintaining its climate goals are contradictory, as business representatives pointed out. Until now, the EU Commission has given unconditional priority to the EU’s climate targets. --Florian Eder, Die Welt, 5 October 2012

Chancellor of the Exchequer George Osborne announced possible tax breaks for shale gas as the U.K.’s energy secretary said he hoped to let drilling resume. “We’re consulting on a generous new tax regime for shale gas, so that Britain is not left behind as gas prices tumble on the other side of the Atlantic,” Osborne told his Conservative Party’s annual conference today in Birmingham, England. --Bloomberg, 8 October 2012

After George Osborne’s speech, a Treasury aide said it was still “early days” for shale, which is still in its pre-commercial testing stage in the UK. But the industry had the potential to create many jobs and bring down the cost of domestically-produced energy, he said. “This is an industry in its infancy and there is a lot of upfront investment needed. We need a new regime to encourage investors,” he said. --Jim Pickard, Financial Times, 8 October 2012

Britain’s energy minister said on Monday he hoped to be able to allow a resumption of shale gas development, partially suspended last year due to environmental concerns about the fracking technology used to exploit it. “I hope it will prove possible for me to give a green light to shale,” Edward Davey said at a gas conference in London. --Reuters, 8 October 2012

Let’s be clear. In principle, I’m all in favour of exploiting shale gas. I would welcome as much as anyone a way to boost Britain’s indigenous gas supplies and to reduce energy prices to consumers and businesses alike… I hope it will prove possible for me to give a green light to shale. --Ed Davey, Energy and Climate Change Secretary, 8 October 2012

Owen Patterson, the new Environment Minister, is apparently "delighted" that he may have shale gas in his constituency, as he told the audience. It had a "spectacular" effect on the American economy, where the locals only noticed it because of the improvements to their infrastructure, he said. It would help us reduce emissions as well, he believed. A role for gas beyond 2030? "Why limit anything?" he said. When asked whether this view was in line with the legal requirements set out in the Climate Change Act, he said that the Act may have targets, but whether we can meet them is a different question. --Alastair Harper, Green Alliance, 8 October 2012

Seven major electricity and nuclear technology firms have threatened to pull future investment from Britain amid fears that the Government’s environmental agenda is being watered down. More than 50 businesses and green NGOs worry that the UK may miss opportunities of a global shift to a low-carbon economy. --The Daily Telegraph, 8 October 2012

Green energy companies are threatening to leave the UK if we don't roll out the subsidies to the promised schedule. This story comes to us via the front page of the Times. And this is a problem why? –Andrew Montford, Bishop Hill, 8 October 2012

In last two years, shares of Chinese solar cell producers have fallen by about half, and more price declines are on the way. The prospects for these manufacturers are poor. More important, the seemingly intractable problems of the sector highlight the limits — and impending failure — of the country’s industrial policy. The industry-wide unprofitability means that Chinese technocrats have to throw their world-dominating industry a lifeline. The only real solution is closing production lines to get capacity in line with demand. In short, central government technocrats, to salvage their industrial policy, will now have to destroy what they worked so hard to create. --Gordon G. Chang, Forbes, 7 October 2012