Subsidize with energy.
I wrote in the last post that nuclear power is a form of subsidy given to industries, and I see that this was the statement that turned out to be (among readers) the most idiosyncratic. And yet, the problem is quite evident, because if we say we "build nuclear power plants", it is almost understood that the state should do it.
To understand this, we need to go back to the whole story. During the Cold War, Östpolitik was born: a German chancellor decided to start doing business with Russia, and since the Soviet Union produced almost nothing in excess, raw materials were chosen. And so Russia begins to export oil and gas, helped by those giants who know how to extract it (Russian companies neither knew how to extract it nor transport it, in the sense that they weren't developed enough and limited themselves to "easy" wells).
This started to bother OPEC, and it started to drive prices down, especially after the historic shock of 1972/73.
As this continued until a few years ago, European entrepreneurs lived in a period of subsidies, only the subsidies came from Moscow. This has produced a European industry that has never been very careful about being efficient:
- non-existent or almost non-existent solar production: the industries with panels on the shed are still very few
- very limited adoption of forms of savings: to push LED lamps over incandescent ones it was necessary to ban the latter.
- limited car use on public transport, neglected urban public transport network
- limited infrastructure (no tube, no tap, no this, no that)
- little district heating infrastructure
- hostility to smart homes
- hostility to telework
- …
The effects of this abundance of energy from a subsidy from Moscow (which would later pay off in geopolitical terms) effectively froze the green transition, since nobody cared about limiting waste. With twenty euros per MWh, but who would have ever spent money to save electricity?
But at some point we piss off Putin and the subsidy ends. The industrialists find themselves with a gas price that has returned to more normal values for what is the relationship between supply and demand.
And they discover that they can't make it, because they use energy-intensive production systems. When it is said that the price of MILK increases due to the price of energy, something has gone wrong in the relevant technology: either someone has electric cows, or everything around the cow consumes too much, if we consider that 100% some milk comes out of the cow.
So, there are two ways to solve the problem.
- Entrepreneurs close the technological gap and start using lighting, heating, production and material technologies that save energy.
- Entrepreneurs ask the state to subsidize energy, taking money from the welfare state, and supplying them with energy at the (unnaturally low) price it used to.
As usual, the latter is chosen. And the bogus "liberals" and "liberals" discover that the energy market of the future is done with state money. Right, Calenda?
So far, I think I've been clear:
AT LEAST 50% of the blame for this crisis lies with the industrialists and entrepreneurs who have little concern for energy costs.
After all, if the solution includes “keep the house one degree colder” or “keep the heating on for one hour less”, well: it could have been implemented sooner, eh.
And it didn't even cost that much: instead of keeping Alexa at home to play music, you could buy something else:
I've been using them for years, and I saw the savings right away. But in Italy I have seen protests against the idea of putting a valve in general, let alone a smart one.
In general, using these you can program them by minimum temperature, time and maximum temperature, and if you open the window above the radiator they understand it and turn it off for you.
This is to say that little has been done, reluctantly, and if the "rationing" measures are sufficient, well, you could have already rationed earlier, and with fewer sacrifices.
But nobody did it because energy was cheap: the proof is that now every day there are people who ask me “what were those smart valves you use? Are you okay?”. Today. But not yesterday.
But let's go back to the industrialists. Who avoided R&D costs for decades when it came to energy efficiency. (except perhaps those who worked in energy-intensive sectors).
They want the subsidy. I say this for a reason.
What is the name of the owner of a company that produces nuclear energy? It is called, you will agree with me, “industrial”. He's definitely an industrialist. And what do you call a typical owner of a regasification plant, whose company imports and redistributes gas? He is still, you will admit, an industrialist.
Good. Leaving aside the useless chatter, I have two questions for you:
- How many regasification terminals intend to buy/build those of Confindustria in the next, say, 10 years?
- How many plants, if nuclear power is built, do those of Confindustria intend to build in the next ten years?
Here comes the dead silence. Why yes, all these things must be done, but it is NEVER that it is the industrialists who put their hands in their pockets and dig out the lira and invest. No.
If we speak of regasification terminals we speak of ENI (CDP, i.e. the state), if we speak of nuclear plants we speak once again of ENEA (the state), we speak of Ansaldo Nucleare, which belongs to Ansaldo Energia, which it belongs to Finmeccanica and the Italian Strategic Fund: still the state.
And where are the industrialists, who are the desperate people who don't know how to live without energy? Instead of investing in schools and hospitals, the state spends the money on projects that in a normal country belong to the industrialists.
It doesn't matter: there is an emergency, and "emergency" means that you don't ask uncomfortable questions and let the state subsidize the industrialists.
After all, it is doubtful that the regasification terminals serve to "free ourselves from dependence on the Russians and not finance Ukraine": what is already happening is that Russia sells discounted gas to other countries (Iran, China, India, etc) and then these countries load it onto ships and bring it to the regasification terminals. At market price. In other words, Russian gas is still being bought, only the loot is divided between the Russians and the proxy countries.
Well done.
In reality, the regasifiers continue to buy gas extracted in Russia, only that their cost was absorbed by the industrialists, not by the state coffers.
It is often said that in 1946 there were no more fascists in Italy, and that everyone said they were communists, even if they weren't. The trouble is that in 1991 the same thing happened: from that moment none of those who believed in the USSR admitted to being a communist. But it was.
Everyone (especially those on the left) called themselves "liberal" or "liberal", depending on the stigma inherited from the past, but in the end none of them is authentically liberal. In a liberal world, it is OBVIOUS that if industrialists need energy, if there is a huge demand for energy, the state must ONLY say that nuclear power is legal, that there are safety rules to respect, and then it is the private individuals (that is, the industrialists) who build the plants.
But those who have recycled themselves as "liberals" coming from the USSR have not understood the problem well. Accustomed by the education of the PCI to thinking that "the state will take care of it", these "liberals" (and I include Calenda too) talk and rant about the market here and there, but when it comes to investing and taking the risk … well … he has to think about it, guess who? The state. Like in the good old USSR in which NOBODY admits they believed anymore.
But I'm sorry to say: when you need something cheaper than the market and the state invests and takes risks to give it to you, you are not in a “liberal” place, you are in the Soviet Union. You are subsidizing.
And again because the Italian liberals and liberals are actually repainted Soviets (and badly too), when I make this objection they tell me "eh, but we also taxed extra income to finance this thing". I don't want to get lost in Marxista Memoria's easy analogy between surplus value and "extra income", but the problem should not be solved with a tax. It had to be resolved with a pat on the back to Confindustria: "Dear gentlemen, I who am the state give you the permits for a regasification terminal in Piombino, now YOU buy/lease it and put it into operation: the first one to arrive wins".
This should have been the "liberal" or "liberal" discourse that Courier and others talk about. But they're not really liberals, they're just repainted communists.
“The state has to do it”.
A liberal state should only give permission to do this and that (plants or regasification plants) and then the industrialists should do things.
But even if we bring up the problem of the emergency, well, the state should say "dear industrialists, I pay the rent of the regasification terminals for a year, I expect that within a year you will be renewed and have become more efficient, or that you propose a consortium to take over the management of the regasification terminal”.
Instead, state-owned companies are used to do everything.
Because communism is over, but also not. And the subsidy is the new market.
How this story ends is obvious because we've already seen it: the state makes the regasification terminals, the state makes the nuclear power plants, and as soon as there's a bit of flab it discovers that "for European rules we need to privatize" . And obviously everything is sold out to the usual friends.
Good. Privatize from the start, then: let them do it from the start. Or, does anyone want to hide the fact that entrepreneurs want ready-made pap from the state?
That is, a subsidized energy?