Transcript: This Isn’t Science, It’s Ideology

First and foremost, we hear this idea that energy prices in Britain are very high. Is this true? Can you quantify that?

KATHRYN PORTER: Well, we have the highest industrial electricity prices in the developed world and the fourth highest domestic electricity prices in the developed world.

KONSTANTIN KISIN: So, yeah, that sounds pretty high. And is that because Britain is uniquely bad at producing energy, or is it for some other reason?

KATHRYN PORTER: We have the dumbest policies, which is saying something because Germany gives us a run for our money on sheer dumbness of energy policy. And in fact, if you take a step back, their policies are probably stupider. But we’re just facing a higher cost premium.

Hidden Taxes and Stealth Charges

KONSTANTIN KISIN: And explain that to us. What is it that Britain is doing to cause our prices, the prices that we pay as ordinary people, to be so high?

KATHRYN PORTER: Well, we’re abusing the retail market and using it as a way of collecting taxes in a stealth way. So normally when the government wants to raise money, they create taxes or they increase existing taxes, and that gets lots of scrutiny by the Treasury and other people. And it’s all looked at in the round as part of government financing.

And then they decided they wanted to encourage renewables, and so they made the subsidies for that be paid through bills instead of through taxation. So it’s effectively a hidden tax. People don’t have any choice about paying it. It’s a mandatory payment, mandatory addition to our bills, and that’s worth billions of pounds a year.

But of course, the renewables that we have are intermittent and they’re located in places where you don’t already have grid infrastructure. You add on billions of pounds to connect them up. You add on billions of pounds to have backup, because it’s not always windy and sunny. You’ve got billions of extra pounds because we didn’t keep pace with the grid infrastructure. So we’re paying them to turn off a lot of the time and we’re deliberately connecting wind farms, knowing we can’t use that output.

FRANCIS FOSTER: What?

The Absurdity of Wind Farm Curtailment

KATHRYN PORTER: So in 2023, October 23rd, Sea Green opened. It’s a wind farm off the Scottish coast. In 2024, two thirds of its output was curtailed, so it was turned off two thirds of the time because there wasn’t enough grid infrastructure to move its output down to where it was needed.

And when that happens, consumers pay a gas power station downstream of the bottleneck to generate the electricity they actually use, and then they pay the wind farm to turn off and they get compensated at the subsidy level. So it’s the wholesale price plus whatever their subsidy level would be.

FRANCIS FOSTER: So.

KATHRYN PORTER: So it’s more than double.

KONSTANTIN KISIN: But this is saving the planet?

KATHRYN PORTER: No, no. And it’s definitely not saving money. I published a report earlier in the year that showed that since 2006, we’ve spent almost £220 billion in today’s money on net zero.

Even the Climate Change Committee says we’re not going to see savings from net zero till the seventh budget period, which is 2038 to 2042. And their assumptions on cost are total garbage. The 2030 assumption for wind is basically double the current price of wind. So it’s really unlikely to halve in five years.

The Impact on Ordinary People

FRANCIS FOSTER: I mean, already I’m speechless because what these people are struggling. People are struggling in this country. Let’s just be honest about this. For most people, if you make it to the end of the month, food on the table, bills paid, rent paid, mortgage paid, whatever it is, that is a massive win.

And then you’re looking at this and you’re just going, this is money being frittered away, which is then being lumped on the ordinary person. This is, quite frankly, disgusting.

KATHRYN PORTER: It is. It’s disgusting. Then they go, “All right, we’ll help out some of the vulnerable people by giving them the warm homes discount.” Well, that is wealth redistribution.

And the way it works is suppliers will have to phone up the Department for Work and Pensions and say, “Tell us which of our customers are eligible for the discount.” So they get the list, then they work out the cost of the discount, they add on an admin fee and then they divide that between all their other customers. This is wealth redistribution. It should be the job of welfare and the DWP, it should not be the job of suppliers.

Hidden from Public Scrutiny

KONSTANTIN KISIN: So one of the things you’re saying is this is all deliberately being hidden from us, the taxpayer.

KATHRYN PORTER: Correct.

KONSTANTIN KISIN: And we don’t know what’s going on, but we’re all paying for it.

KATHRYN PORTER: We are. Yeah.

KONSTANTIN KISIN: Right.

KATHRYN PORTER: And there’s no scrutiny of it either. So nobody’s sitting there doing value for money analysis the way they would on taxation. If Ed Miliband wants to add 22 billion pounds of levies for carbon capture, and a large part of that’s going to be added to bills. Now, if that was going to be done through taxation, then there’d be an assessment of value for money, but it’s going through bills, so that doesn’t happen.

How Britain’s Electricity System Works

KONSTANTIN KISIN: Okay, I feel like with those headline kind of statements in place, can you just take us all the way back and explain to us how electricity is generated in this country? What percentage of it comes from what? What percentage is imported, exported as such? Just give a kind of basic layman overview of the entire energy market so that we kind of understand what we’re talking about.

KATHRYN PORTER: Okay. So in terms of what generates our electricity, most of our electricity is coming from gas. We’ve got a chunk of nuclear, although it’s a declining chunk at the moment. We’ve got five nuclear power stations. Four of them are scheduled to close by 2031. Still got a few decades to go. I actually think those four will probably get new extensions. We’ll go to the early 2030s then.

We’ve got about the same amount of wind installed now as we have gas power stations, but they only work basically a third of the time. So obviously it’s equivalent of only having a third of the gas power stations. And then we’ve got a little bit of biomass where we’re chopping down trees in America and shipping them over to Yorkshire to set fire to them.

And then we’ve got imports, we rely quite heavily on imports, which is a bit risky because right now in Norway they’ve got, they’re approaching 20 year hydro lows. And the hydro system in Norway is kind of unique because they don’t have any pumps. So once the water’s used up, that’s it until next time it rains or the snow melts.

And so if the water levels get too low, they’ll have to ration. And now unless they have a wet autumn, they’re going to be in that sort of territory. So they could very well restrict exports or start importing from us now that the capacity on that cable is the equivalent to about 2 gas fired power stations. So obviously we normally import. If we started exporting, that would be like having four fewer power stations than we normally do. We don’t really have much to spare. So yeah, it’s not a very safe system, I would say.

Critical Infrastructure Risks

Now in terms of how electricity is generated, and I will do a little bit of the nerd stuff here, please. So there are two ways in which our electricity system isn’t safe. One is that we’re just running out of power stations. A third of our gas power stations were built in the 1990s. And normally you’d expect these types of assets to last for 25 to 30 years.

Now, they had upgrades in the early 2000s, most of them, that would give you the 30 years rather than the 25 years. But you’re starting to come to the end of that. We have no replacement plan for these assets. And to buy a new gas turbine now is an eight year lead time. So if they’re going to start retiring by 2030 and you could lose a third of the fleet, this is a major security of supply concern and we need to have already started planning for that replacement and we haven’t done anything.

Grid Stability and Technical Challenges

So the other risk that we have is a stability problem. And the stability problem arises because our power grid uses alternating current and renewables and batteries work on direct current. And trying to put direct current into an alternating current grid is like putting a square peg into a round hole. It’s technically difficult to do.

And one of the things that stabilizes the power system are conventional generators. So the way that works is to create the alternating currents, you rotate one magnet inside the magnetic field of another magnet. And so you’ve got these magnets on the turbines and stuff. And that creates current and voltage that varies in a stable cycle. And you have a nice wave.

And that wave is linked to the speed that the turbines rotate. So in Europe, they rotate at 3,000 RPM. And that gives you 50 cycles of your voltage and frequency and current per second. And that’s called the grid frequency. And it’s a really important parameter in the electricity market. Equipment across the grid is very sensitive to it. And so they all have protection measures that will basically turn themselves off if that frequency goes out of whack.

And it’s also linked to supply and demand. A bit like water in a pipe. So if you put more water in the pipe than you take out, eventually the pressure goes up and the pipe would burst. If you put more electricity into the grid than you take off, the frequency tries to speed up and then the opposite is true. If you’re taking more out than you put in, it will slow down. And if it slows down too much, then everything turns itself off, which is basically what happened in Iberia. Everything turned itself off because the frequency went outside the range that it was supposed to be in. Now, other stuff caused that, but then that was the actual reason for the blackout. So it’s really important that you control that.

The Inertia Problem

The other thing that you get from conventional power stations is not just that they set up that nice wave in the first place. Because they’re big, heavy lumps of metal, they resist changes to their speed of rotation. So if you get a reduction in generation and your demand has gone up and it’s trying to lower the frequency, which would mean slowing down the turbines, well, they’re not very inclined to do it.

So they’re providing this thing called inertia, which is basically a resistance to that change, and that makes changes slower and it then becomes less likely that stuff will be turning itself off. But as you start replacing those conventional generators with renewables, they create this alternating current through electronics. The electronics don’t have any inertia. They’re actually quite even more sensitive than other types of equipment to frequency changes. And so they can contribute to the problem.

We saw that in Spain. We saw solar in particular and wind tripping off when frequency was actually still inside its operating, or what was supposed to be its operating parameters. So they disconnected and then that caused the frequency to drop to a level where everything else turned off, because then it did go outside of their safe parameters.

So the more you try and replace conventional generation with renewables, the less secure and stable your grid becomes. And 11 people died in the Iberian blackout.

The Iberian Blackout: A Renewable Energy Failure

KONSTANTIN KISIN: Let’s talk about the Iberian blackout, because I won’t pretend to understand the full intricacies of it, but we have a super fan of TRIGGERnometry who’s objectively the most intelligent person that we have ever met, who works somewhat in this area. And when he knew you were coming on the show, he said, “Absolutely make sure you talk about this.”

Because he messaged me the day that that blackout was happening and he said this is to do with renewables and most people – nobody – I don’t see that covered in the media remotely. That wasn’t part of the narrative. Nobody said anything about renewables, Net Zero. But what you’re saying is this is a direct consequence of what happens when you become over reliant on these systems that aren’t… I mean, are we being charitable and we’re saying they’re not there yet, or is that too charitable?

KATHRYN PORTER: I think that’s too charitable.

KONSTANTIN KISIN: They’re never going to be reliable enough.

KATHRYN PORTER: No, I mean, I was actually asked recently to write a blog about whether we could actually create a direct current grid, because you can do little micro grids that are direct currents, but actually to do anything large scale, it wouldn’t work. It wouldn’t. You wouldn’t be able to get the stability, the technology doesn’t exist to do that. And so, no, you couldn’t. You’d still have to have alternating currents.

KONSTANTIN KISIN: That’s why I asked about… Did we not develop technology? I mean, we’ve, you know, there was a time when we didn’t have things, and now we do. Is that okay?

KATHRYN PORTER: Well, maybe, but we don’t currently see a trajectory for it.

KONSTANTIN KISIN: Okay, so explain.

KATHRYN PORTER: We could say, for example, that we might be able to make nuclear fusion work, but we’re very far away from that being commercialized at the moment, so we can’t really include it in any sort of useful planning.

KONSTANTIN KISIN: So explain to people in a more basic way what happened in Iberia exactly. And why is it that wind and solar in particular, you did some of that briefly, but just explain it.

The Technical Breakdown of the Iberian Grid Failure

KATHRYN PORTER: Right. So what happened in Iberia was… The first thing was they noticed some funny frequency oscillations that were at 0.2 hertz. And the Spanish grid operator said, “Well, these were a bit funny, but we’ve been seeing these in the European grid for some time, so they’re not unusual.” Now, I would say that maybe you’re normalizing deviance there, and that’s not necessarily smart. But nevertheless.

Then a little while later, they identified 0.6 Hz oscillations. Now, coincidental to both of these frequency oscillations, you had fluctuations in voltage. So it was both a voltage disturbance and a frequency disturbance. Now, the system operator wrote a report that sort of implied that they were causing each other. But I think that was just poor use of language because it was a translate, so the English version is a translation.

It’s a little bit like saying sunshine makes plants grow, and sunshine can give you sunburn, but plants growing doesn’t give people sunburn. So anyway, so you had this 0.6 Hz voltage oscillation. And the system operator tried to… So it was a frequency oscillation and the voltage disturbance. And the system operator tried to engage some pretty static responses to manage what was quite a dynamic situation. And to begin with, they were successful. And then it sort of wore off and the oscillations recurred.

And also at the same time, because it was the middle of the day and because there was lots of solar at the time, quite a lot of solar connected to the distribution network turned itself off because prices went negative. So that shows up as demand on the transmission system. And so all of a sudden you had more demand than generation. And of course, that causes your frequency to start to drop.

Now, the voltage disturbance, they were trying to control that with something called reactive power controls. And these are things that both conventional power stations and inverter based resources like wind, solar and batteries can help to address. But there were two problems with that. One was there was widespread non compliance with grid codes that both inverter generators and conventional generators just didn’t respond the way they were supposed to under the grid codes. The other problem was that the system operators simply hadn’t scheduled enough conventional generation to provide the amount of conventional reactive power that was needed to stabilize the grid. So it was a planning failure plus a compliance failure.

So the next thing that happened was we had some transformers tripped off and some renewable generators tripped off. And this was in response to that reduction in frequency. Now they tripped off when the frequency was still inside what should have been normal operating parameters. So this was another failure to adhere to grid codes. The loss of that renewable generation pushed the grid frequency outside its operating parameters and that triggered conventional generators to trip. So that wasn’t a grid code compliance failure because the frequency was now outside its operational limits. And therefore from that point onwards, the system wasn’t savable.

You had a cascading blackout. Each new power station that tripped off caused another reduction in frequency that made something else trip off. And then everything, it just cascaded down to 0 within seconds. That original 0.6 Hz oscillation was traced back to a faulty solar inverter. So the grid disturbance that caused everything was a renewable asset, a renewable generator.

Lots of renewable generators were non compliant to grid codes, both in terms of reactive power and in frequency. You might have got away with the reactive power. You definitely couldn’t get away with the frequency. And then you had conventional generation non compliant with the reactive power obligations. And then you had the grid operator who tried to use static measures to respond to a dynamic situation and failed to plan enough reactive power and essentially just failed to schedule enough conventional generation on the grid.

About two weeks before that, they’d made a big song and dance about running the grid with 100% intermittent renewables for a very brief period. Immediately after the blackouts, they started saying, “Oh, well, we know what to do to prevent this from happening.” Well, that was just run more gas. And that’s exactly what they have done since – they’ve run more gas. So yeah, renewables definitely were the cause of the Iberian blackout.

And what’s really interesting is when the fault propagated into France, you had a very small region of France that was affected and had a short power cut. Basically France, their generation mix is almost all nuclear plus a good chunk of hydro, which is another conventional source. So big spinning machines, that means that the French grid has very high inertia. And so the fault didn’t propagate into France except this very small region. And they restored power into that region very quickly. So that just shows the difference between a high inertia grid and a low inertia grid. And so if you lower your inertia too much, you’re playing with fire.

The Ideological Drive Behind Renewables

FRANCIS FOSTER: So the question, therefore is, Kathryn, why this obsession with renewables if they quite clearly don’t, are nowhere near as effective as the older types of technology.

KATHRYN PORTER: It’s an ideology. It’s literal ideology. It’s not based on evidence, it’s not based on science, it’s based on wishful thinking.

FRANCIS FOSTER: So if that’s the case, then what we have is people who are telling us that we need to invest into this technology. Billions and billions of pounds, but it’s not based on any type of scientific fact.

KATHRYN PORTER: Yes, correct. And you get people continuing to insist on certain things despite all of the evidence to the contrary. So Miliband keeps saying that energy prices are high because of gas prices. Well, gas prices are down 84% since their peak – bills are definitely not down 84%.

And the subsidy round last year, AR6 offshore wind priced at £83 per megawatt hour in today’s money, the average wholesale power price in 2024 based on gas, because gas is the marginal generation. And so that sets the price was £73 per megawatt hour. So offshore wind last year was 13% more expensive than gas just for the subsidy. And then you’ve got to add on the connections, the backup costs, the curtailment costs and the real time balancing costs, because every cloud, every gust of wind puts that supply and demand balance out.

And obviously you’ve got to maintain the frequency really closely. So you’ve got to keep the supply and demand really matched in real time. And that’s adding billions of pounds a year to our bills. So even that first order level of the subsidy, 13% higher. And Orsted canceled Hornsea 4, which was the flagship project, saying it was not enough money. Yet they’re still spouting this nonsense that renewables are cheap. Renewables are self evidently not cheap, so they’re ideologically captured.

When Will the System Fail?

FRANCIS FOSTER: Yes, we’re pursuing an energy policy which is not only unreliable but also far more expensive. I guess the next question is, well, the rubber’s going to hit the road at one point. When do you think that’s going to be and what is it going to look like?

KATHRYN PORTER: So we had a near miss in January when the market got far tighter than we’d ever expect.

FRANCIS FOSTER: So what does that mean, Kathryn?

KATHRYN PORTER: There’s a lot that we nearly ran out of generation.

KONSTANTIN KISIN: We nearly had blackouts, we nearly had…

KATHRYN PORTER: Blackouts because we nearly just didn’t have enough power stations to meet demand. So one of the problems we have is that NESO, the system operator, is a bit rubbish at forecasting demand. So after that near miss on the 8th of January, they were quite upset with me and lots of journalists were quoting my work to them and NESO tried very hard to discredit me, which the journalists were kind enough to tell me. So I know that this was happening.

And then every week NESO has this thing called an Operational Transparency Forum that anybody can dial into. And a week or so after this event, they decided that they were going to do an audit of their demand forecasting. And the engineer who announced this said it had been 10 to 20 years since they last looked at their demand forecasting.

Now, I’d written a blog about this, because I’d said the section of the grid code that covers this doesn’t look as if it’s been amended meaningfully since it was written basically in 2001, which is when our current electricity trading arrangements were put in place. And this is part of the problem with our system of governance. It actually isn’t anybody’s job to make sure that the system is secure.

FRANCIS FOSTER: What about the Energy Minister?

The Regulatory Gap in Energy Security

KATHRYN PORTER: No, it doesn’t fall with anybody’s remit. Nobody’s responsible for security of supply. So we have all of these industry codes that govern how people should behave in the market. Like the grid code talks about how if you’re connected to the transmission system, how you have to behave, what standards you have to meet, what services you have to provide, what you can and can’t do.

But that was written back in the days when you had a relatively small number of power stations that were big and conventional connected to the grid. Now you have lots and lots of much smaller power stations. They’re not all connected to the high voltage grid. A lot of them are connected to the low voltage grids. So that means that ESO doesn’t directly see them, but they have an impact on the transmission system. So really they need to know.

And it seems like for batteries, they have to tell them information about charging but not discharging or vice versa. And so it’s all a bit nuts, right? It’s never been updated and it’s not anybody’s job on an ongoing basis to say, “Well, given the market change, is this code still fit for purpose? If everybody follows the code and does what the code says they should do, will the system be secure?”

And right now the answer is no, because the code doesn’t take account of the way the market’s changed. So NISO admitting that they hadn’t looked at their methodology for demand forecasting in 10 to 20 years was quite shocking. But I wasn’t shocked because I know how these things work. But objectively speaking, how is it that nobody took a step back and said, “Actually, our demand forecasts are a bit rubbish, maybe we should look into how we’re doing them.”

The Reality of Blackouts

FRANCIS FOSTER: You know, just because we’ve used the word blackouts, and unless you’ve actually lived through a blackout, like, everyone can drink now. I lived. I spent a lot of time in Venezuela. When you have a blackout, that’s very serious.

KATHRYN PORTER: Yeah.

FRANCIS FOSTER: What are the effects of a blackout on a country, on the economy, on people’s lives, et cetera?

KATHRYN PORTER: Well, I mean, they think that the blackout at Heathrow cost tens of millions of pounds, and that was just at one airport. So imagine that across the whole country now in Iberia, 11 people died. And that blackout happened in what I call Goldilocks weather conditions. So it wasn’t too hot and it wasn’t too cold.

The risk points for us in Britain would be a winter evening. That’s when we’re most likely to have a blackout, particularly a nationwide blackout that will be most likely to happen in a winter evening. Now, you think about London at 5pm in early December, it’s dark already. You’d have no street lights, no traffic lights, no ambient light from buildings. All of those stupid illuminated bollards in the road wouldn’t be illuminated anymore. You’d have car headlights and you’d have people’s mobile phones.

At 5pm in the December, early December evening, children are still coming home from school. So your chances of having traffic accidents and road fatalities quite high. Elderly people falling in the home, people being stuck in unheated, unlit lifts, people being stuck in unheated, unlit trains. Anybody with health vulnerabilities there will be in trouble. People who rely on medical equipment in the home.

So the fatalities in Iberia – one was a death from a house fire associated with the use of candles. There were seven fatalities because people were using mechanical ventilators to breathe and the backup generators failed. And then another situation where there was a backup generator, which it didn’t fail, as in stop working. It started to give off carbon monoxide. So not only the patient, but two of the patient’s relatives suffocated.

So this is no joke, right? A winter blackout in Britain, I think you’d see a lot more than 11 people losing their lives.

FRANCIS FOSTER: So it’s not only ideologically reckless, they have been reckless with people’s lives here.

The Hidden Cost of Energy Policy

KATHRYN PORTER: Yeah. And also we have between 6 and 8,000 people dying prematurely each winter as a result of fuel poverty. So I’ve got a good chart in my report which shows wholesale gas and electricity prices going back to the 1990s and household spend on electricity.

And what you can see is that up until 2021, wholesale gas prices were fairly low and stable. Wholesale electricity prices were a little bit higher, but fairly low and stable, which is what you’d expect because gas is the fuel for electricity, so you’d have a little bit more cost coming in with that.

But then from 2006, so up until 2006, the retail price of electricity was also fairly stable. So you had the wholesale price, you add a little bit of gas, you add little bit to get the wholesale price of electricity, then you add a little bit to get the retail price of electricity, and that reflects the cost of delivering it and the accounting. You have to do the billing and stuff. So that was all fine.

And then from 2006, the retail price started to diverge dramatically from the wholesale price. And actually what you then found was it had gone up in this big slope up to 2021. So then you had the gas crisis, and the wholesale gas and electricity prices actually leapt up almost to meet where the retail price was. And so. And the retail price was artificially reduced because the government suspended some of the levies and stuff and started giving people the energy price guarantee, which is effectively a house subsidy to consumers. And then you see the wholesale prices drop off again, but the retail price actually went up before it came down.

KONSTANTIN KISIN: So what you’re saying. I’m converting some thinking of how to convert this into simple language. First for myself and for our viewers and listeners. What you’re saying is, effectively this is we’re baking cakes, right? And the key ingredient in cake is sugar. Right. And the price of sugar stays the same. It goes up slightly. And in line with that, the price of cakes goes up slightly. But what happens when you introduce all these levies is the price of sugar is not going up anymore, but the price of cakes has gone way up because the government has put in a stealth tax on cakes that none of us really know about or get to vote on. Really?

KATHRYN PORTER: Yeah, it’s like them saying you’ve got to add in like fluoride to cakes or something.

KONSTANTIN KISIN: Right.

KATHRYN PORTER: And then that fluoride is really expensive and actually you can’t really absorb it through eating it in cake, so it’s a bit pointless, but you’re still having to spend loads of money, you’re still paying for it.

The Ideological Pursuit of Harmful Policies

KONSTANTIN KISIN: And look, I don’t want to skip over because I think there’s a danger in having these kind of conversations that we skip over the reality of what you’re saying. I mean, you are making an extraordinary claim, Kathryn, which is that the government is making us all poorer and less safe.

KATHRYN PORTER: Yes.

KONSTANTIN KISIN: And less geopolitically safe. We’re more reliant on all sorts of importation, etc. And they’re doing this for ideological reasons. Can that really be true? Entire countries, maybe an entire continent of Europe pursuing these policies that you say are making us less safe and less wealthy. And they’re just doing it because, you know, this is what they believe.

KATHRYN PORTER: Right. So the less wealthy thing isn’t just happening in energy. I don’t know if you saw Kemi Badenoch’s speech. I think it was in March when she repudiated the net zero 2050 target. And in that speech she said that over the years we started to take prosperity for granted. And I think that’s really true.

We’ve overregulated our economy and not just in the sense of energy, but in all sorts of other ways as well. Financial services, where I began my career, massively overregulated and inappropriately regulated. Look at the water sector. The entire problem with Thames Water is because Ofwat didn’t understand its own price control. It actually would have been better off if that price control didn’t exist.

Now that might sound crazy that a monopoly supplier shouldn’t have a price control, but actually if you hadn’t had the price control, you could have had controls over dividend payments. There would have been no incentive for somebody like Macquarie to come along and buy Thames Water. The people who would have wanted to buy water companies would have been pension funds because they’d want long term stable income. They would not allow the erosion of the asset base the way short term short horizon financial engineers like Macquarie do. It was because of the way the price control was structured. That whole situation happened.

And because you have rules based regulatory processes which encourage you to hire loads and loads of people to set the rules and monitor the rules and train people about the rules and report on the rules and enforce the rules and punish people who break the rules. You have this whole cottage industry of stuff that does not contribute anything to growth. It is a make work activity. They watch people doing work, but they don’t contribute to growth or economic output. And often they make it worse.

Because in energy suppliers have to employ people just to respond to Ofgem information requests. That’s all they do day in and day out is just respond to information requests from the regulator. So this is crazy. So. And across Europe we’ve seen this belief that you can’t just do stuff, you have to do it nicely, you have to do it in a nice way.

FRANCIS FOSTER: What does that mean?

The Solution: Principles-Based Regulation

KATHRYN PORTER: And the way that nice has been defined has been by technocrats who aren’t elected and who have some ideology about this, that and the other, like the price control in the water sector. We need to get rid of that. We need to go back to principles based regulation. You’ve got to fire hundreds and thousands of people who work in the regulatory space.

If you go to principles based regulation, you no longer need armies of people writing rules setting rules, training people in the rules. In energy, for example, you could take, well, I think we should adopt the FCA principles within Energy. So the Financial Conduct authority principles, there’s 12 of them and they’re all straightforward things like behave with integrity, behave with due skill, care and diligence, cooperate with your regulator, treat customers fairly. You know, these are not controversial things.

Now, instead of setting detailed rules around customer acquisition and tariffs, all Ofgem needs to say is right. “Treating customers fairly will deem it unfair if you charge existing customers a worse tariff than you’re setting for new customers for customer acquisition.” Like job done. Like no need for detailed rules about how all that works. It’s a guidance.

And then they might look into it here and there, but then it’s more like a controls based audit where you do it on a sample basis rather than trying to look at every single little thing in the, in the accounts that would cut radically the headcount in regulation. And then you just need to pay those people more because you need them to be really smart. The whole economy becomes way more productive.

The Problem of Scientific Illiteracy in Government

KONSTANTIN KISIN: Well, that sounds amazing. I guess what I’m getting at though is first and foremost is I think it’s quite a lot for people to wrap their heads around that we are pursuing terrible policies for our country and it’s because the people in charge just don’t care about science. That’s a claim that for most just normal people who haven’t studied this as much as you have, it takes quite a lot to believe that. Do you see what I’m saying?

KATHRYN PORTER: Okay, but look at who the people in Westminster and Whitehall are. How many of them have any training in science? Look at this current government now. How many of them have ever worked in business? How many of them ever run a business? How many of them have ever done anything other than be a politician or a trade unionist or work in a think tank?

And that’s why the budget was so terrible and why the economy is performing so badly is because they have no idea what they’re doing, because they see business as something other that they can just tax rather than being a driver of growth. And the same really applies when it comes to science. They’ve all got history degrees and politics degrees and PPE and whatever. Hardly anybody in Westminster and Whitehall has a degree in any sort of scientific discipline.

You saw it in Covid when they said all this stuff about “follow the science.” That is a ridiculous thing to say. The science might suggest you kill everyone over the age of 80. Doesn’t mean you should do it. And also, there’s no such thing as “the science.” Science is never settled. That’s just how science works. You can never prove something in science. You can only disprove it.

For centuries, we thought that Newtonian mechanics was it. We understood how mass interacted with other mass, and then along came Einstein and relativity, and we discovered quantum mechanics and saw that. Oh, well, that doesn’t apply at the very small scale. Like, who knew? Like, nobody.

So science is never settled, and you need to have people with scientific training in those positions of authority, and we just don’t. So it’s not a surprise that they get misled. Somebody will say, “Well, wind power should be cheap because the wind is free.” And that sounds very logical. But building the machines that turn the wind into electricity isn’t cheap. Those machines are really expensive.

The Academic Elite and Climate Policy

FRANCIS FOSTER: Kathryn, I’m going to push back on this because I don’t actually agree with you. Okay? And I’ll tell you why. So full disclosure, I’ve got a degree in drama and English from Essex University. All right?

KONSTANTIN KISIN: Right.

FRANCIS FOSTER: I am not an academic.

KATHRYN PORTER: Genius. Yeah.

FRANCIS FOSTER: I’ve sat here with you.

KATHRYN PORTER: You’re not a genius anyway, because that’s a plural.

KONSTANTIN KISIN: Yeah, exactly, exactly.

FRANCIS FOSTER: Thank you for doing my job. But anyway, my point is this. I was able to follow it, and academically, I’m quite mediocre. These are people who’ve been to Oxford, Cambridge. Yes. They may have history degrees, they may have politics degrees, but when it comes to academically, we’re talking about the top 1 or 2%. So there’s part of me that goes, I kind of get it, but I don’t buy it.

KATHRYN PORTER: Right. Because they want to believe it. So it’s a mixture of lacking the training in science that would give them those critical thinking skills. Look at the Great Barrington Declaration during COVID. Now, in retrospect, most people think those guys were right, but at the time, they were considered pariahs for saying what they said. Because policymakers did not understand science, and when people presented them with information, they lacked the ability to say, “You know what? That doesn’t pass the smell test. I just don’t buy it. That just doesn’t sound sensible to me.”

Manufacturing Consent and Media Narratives

KONSTANTIN KISIN: And more so this is the other thing, because there’s a manufacturing of consent thing going on here as well. Because I remember when we had Boris Johnson on the show, and in the substack section, I challenged him very directly on the fact that he was, you know, we were told he was this libertarian who really cared about people’s freedoms. And why did you lock down again, why did you pursue all these COVID draconian policies? They’re absolutely draconian.

KATHRYN PORTER: So why did nobody say in the mainstream that in recorded history no pandemic has ever lasted longer than low double digit months? Because when we were living through COVID, everyone was behaving as if it was forever, that the only way out of the pandemic would be a vaccine. And yet that was blatantly not supported by the evidence.

KONSTANTIN KISIN: Well, what Boris Johnson said, and this is very much my point, Kathryn, is, “Well, by that point the public were. They just wouldn’t accept, they were demanding.” And that’s because there’s an… Let’s just be honest, there are narratives in the media and in public discussion where people are afraid.

KATHRYN PORTER: Rubbish from that idiot at Imperial College who never managed to get any single forecast anyway remotely correct. He was wrong about swine flu, he was wrong about BSE or whatever, he was always wrong. And yet they kept wheeling him out and he was like, “Oh, you know a million people are going to die by the middle of next week.” And everyone’s like, “Oh no, we’ve got to do something about it.”

The Climate Change Narrative

KONSTANTIN KISIN: Well, this is my point, right? This is my point exactly. With net zero and all of this green levies and all these other things, if you go out in the street, forget about your knowledge and your expertise and your training and our opinions and the podcasting and I just talk to normal people. The narrative is as simple as this. The planet is in imminent danger because of climate change. If we don’t deal with carbon emissions right now, then by 20… It depends who you are. 2030, 2035, 2050. But within our lifetimes, certainly within our children’s lifetimes, we’re all going to die, the planet’s going to burn. And the only way to deal with that is to immediately transition to renewable energy, get to net zero so that we’re not producing more carbon than we are getting rid of. And whatever it takes to achieve that.

KATHRYN PORTER: That’s the interesting thing, because that’s not true. In the polls, people will say, “Yes, we want action on climate.”

KONSTANTIN KISIN: Yeah.

KATHRYN PORTER: But then when you ask them how much they’re willing to spend on achieving that, they’ll say something like £10 a year, right? It’s some ludicrously small amount they’re actually not willing to spend.

KONSTANTIN KISIN: See, it depends how you ask the question. Because if you say to people, “How much are you willing to spend?” They’ll say £10. But if you say to me, “Look, your energy bills have gone up and it’s because of the war in Ukraine.” We won’t tell you about the green levies and all this other stuff and by… Oh, green levies, yes, to save the planet people. Actually a lot of people are on board with that because the money, they don’t feel that the money is being taken out of their pocket. That connection hasn’t been made in many people’s minds.

KATHRYN PORTER: Well, it’s because they’ve been lied to by policymakers, but people are starting to see through that.

The Reality of UK Emissions and Global Impact

KATHRYN PORTER: In the UK we are only responsible for 0.8% of global emissions. So we could cut to zero ourselves and literally it makes no difference to global climate change. Secondly, our net zero policies measure territorial production emissions by making our energy expensive. We’re incentivizing offshoring of manufacturing so we could meet our target tomorrow by just shutting down all our manufacturing. But the result of that is global emissions go up.

And this is what annoys me so much about what Labour’s doing is they just don’t seem to be willing to accept that they’re making global emissions higher. Miliband repeats time and again “We must act because of the climate emergency.” All these factories closing, all our steel plants closing. That happens. We then start buying our steel from China and things like girders. And then you have to ship girders halfway around the world in ships that burn bunker fuel, which is like the dirtiest part of the crack.

Shipping low value heavy bulk items halfway around the world is a very stupid thing to do. And that creates a lot of emissions. So not only does is the production more polluting because they have dirtier energy in China then you have all these emissions that you didn’t otherwise have from transportation, but because our targets are just looking at territorial production emissions, then, oh, you can just virtue signal that we’re…

KONSTANTIN KISIN: You know, and British blokes are not getting the job because of it.

KATHRYN PORTER: Yeah. So we’re losing employment, it’s bad for the economy, we’re having these artificially high energy prices, it’s putting more people in fuel poverty and it’s making emissions higher. And how does that make sense?

Virtue Signaling and Carbon Border Adjustments

FRANCIS FOSTER: And the key word that you use there, because I was going to, that was going to be my follow up question to you, Kathryn, is it’s a virtue signal because we’re still consuming.

KATHRYN PORTER: Exactly.

FRANCIS FOSTER: We’re just getting somebody else to do it so that we can look good.

KATHRYN PORTER: Right. So here’s the thing. Now they’re going to introduce something called the carbon border adjustment mechanism where they’re going to tax imported goods that are made with dirtier energy to try and make them equivalent to our emission standards. This is going to be unbelievably inflationary. And so if the economy isn’t in the toilet already, it will be when this comes in.

FRANCIS FOSTER: So what are the products that we’re talking about that are going to be taxed with this?

KATHRYN PORTER: Everything.

FRANCIS FOSTER: Sorry, I know this is going to sound like… What do you mean by everything?

KATHRYN PORTER: Clothes, steel, cars, concrete, wind turbines, solar panels, everything.

FRANCIS FOSTER: Are they mental?

KONSTANTIN KISIN: Yes.

Historical Parallels and Ideological Failures

KATHRYN PORTER: But this comes back to this. How is it that you can have this widespread ideological failure if you like, but this has happened many times in history. Look at the Reformation and the Spanish Inquisition. You had a society then that believed that if you didn’t follow the true faith and different people disagreed about what the true faith was, you would burn in hell for eternity.

Now if that’s your belief, then you can justify going to just about any length to try and convert somebody to what you think the true faith is. You can justify any type of horrible torture to convert them to save them from eternal damnation. Right. So now we would look back at things like the Spanish Inquisition, the English martyrs and all that stuff, and we’d say that was ridiculous, that was horrific. How could they crush people under doors that were loaded up with rocks just because they were Protestants instead of Catholics and vice versa? Well, that was the reason why? But everybody believed it. Nobody thought that was crazy.

Conservative Party’s Role in Net Zero

KONSTANTIN KISIN: Well, to your point about everybody believing this is, I think, where another challenge for a lot of people comes in. I remember actually the moment when I realized how deep this rock goes, because I was on Question Time with a guy called Jake Berry, who’s a recent defector from the Conservatives to Reform. And when I mentioned some sort of skepticism about the idea that net zero is actually good for the country and in fact it might be making us poorer, he reacted with this furious response about how green jobs are the way forward, they’re going to save our country, and you, Konstantin, are the problem. And all of this other stuff.

KATHRYN PORTER: Oh, because you’re personally responsible for…

KONSTANTIN KISIN: Well, whatever. I’m just saying it. Look, I’ve got no problem with someone having to go at Miliband. I think it doesn’t strike me as, you know, the answer to Britain’s problems. But it’s not just the loony left, if you, if this is how you want to label it. I mean, the Conservatives in the last government, they have 14 years to deal with this, and what did we get?

KATHRYN PORTER: But now they’ve realized they were on the wrong track.

KONSTANTIN KISIN: Oh, well, that’s a relief. 14 years later.

KATHRYN PORTER: Well, okay, but I can explain why.

KONSTANTIN KISIN: Okay.

The Civil Service Problem

KATHRYN PORTER: When Gordon Brown was Prime Minister, he passed a law that made the civil service independent of elected people. So civil servants do not report to their ministers. Ministers cannot fire civil servants if the civil servant isn’t doing what the minister wants. Tough. And that’s when you get all this talk about, “oh, so such and such a minister was bullying their civil servants.” It’s because the minister was trying to be assertive about, “well, I’m elected and I want you to do this.” And the civil servants were pushing back.

That change happened not long before the Conservatives came in in 2010. So the process of the civil service becoming politicized, because once they no longer had to do what the ministers were telling them, they’ve basically started to form their own culture and their own ideology, which is pretty left wing. And this was a gradual process.

The Conservatives didn’t really know it was happening because they were behind the wall, if you like. They would say to officials, “right, give me information about this, that and the other.” And they’d get information and they would trust it and they’d make decisions on that basis.

So then they lose the election in 2024. And now if they need information, they can’t ask the Civil Service for it. They have to go and find it for themselves. And then suddenly they were like, “oh, my God, we’re getting all this information. That’s not the same as we were getting when we were in office.” They suddenly realized that they were only seeing a subset of the available information, not getting a complete picture. They were basically misled by officials.

Now, that might sound unbelievable, but I would say if you don’t believe that that’s happening, watch the Post Office inquiry. Watch the testimony of both the officials and the ministers in that inquiry. Those officials had no realistic ideological position there. There’s no reasonable basis for saying that they believed the Horizon IT system was robust. That is not something that a civil servant should have an opinion about. And yet they restricted ministers’ access to information. They prevented ministers from understanding the breadth and scope of that problem.

And minister after minister came and testified to the inquiry that they just did not know. And they’d receive letters from constituents. And the way that works is you write to… If your MP is a minister, you write to the minister. The civil servants will read the letter, they will draft a reply, they’ll put it in the red box. The minister signs it without having read the original letter or read the reply, because they’ve just got 100 letters to sign. They sign them.

If your MP is somebody other than the minister, you write to your MP and then your MP writes to the minister. Then the civil servant will give the Minister both the MP’s letter and the minister’s response, and the minister might read them both or just might sign it. So you can see there how information flows are restricted. The civil servants could have said, “this is the 756th letter we’ve had on this topic, all saying the same thing.” They never did. So the ministers were never able to build a picture of what was going on.

And that was happening in an area where there was really no ideology to be had. So if that’s happening where there is no ideological bias, just imagine what’s happening where there is.

FRANCIS FOSTER: So, effectively, what we have is a civil service that is corrupt and is not fit for purpose.

KATHRYN PORTER: Correct.

FRANCIS FOSTER: I mean, number one, that is… Well, that’s… Let’s just be honest about that. That’s completely terrifying.

KATHRYN PORTER: But even Labour has admitted this. Labour has said, “we don’t run the country. Civil service, civil servants and quangos run the country.” And you saw it very clearly with NHS England. Wes Streeting kept saying, “stop hiring people in DEI roles.” NHS England kept hiring people in DEI roles. And then Streeting turned around and said, “right, I’ve had enough. Right, you’re abolished. I meant it. When I said, no more DEI.”

The Democracy Problem

FRANCIS FOSTER: So there’s going to be a lot of people who are listening to this, who goes, “well, if the government aren’t in charge and Labour have admitted this, then we don’t actually have a democracy, do we?”

KATHRYN PORTER: Correct. We don’t have a functioning democracy.

FRANCIS FOSTER: And this all comes back to Gordon Brown.

KATHRYN PORTER: I mean, New Labour as a whole, they made the Monetary Policy Committee independent. They made lots of regulators independent, they made the Civil Service independent. You’ve got all these quangos. Quangos are technically responsible to Parliament. Ofgem, Ofwat, all these other people responsible to Parliament. But how does that work in practice? How does Parliament exercise oversight over these bodies?

Typically, Parliament won’t do anything until something’s gone wrong and then they have an inquiry into the thing that went wrong. There’s not really a mechanism from preventing it going wrong in the first place.

So really the only way to deal with this is to repeal that Gordon Brown legislation and to fire all of the Permanent Secretaries and the Directors General and hire and make those roles political appointments and move to a more US style of system. Because you’re not going to be able to remove this once it’s politicized, it’s almost impossible to reverse that.

But that legislation might take some time to pass. So in the interim, you need to create a separate government department with responsibility for oversight over all of these bodies. And the creation of that government department would then require the creation of a select committee in Parliament. And then hopefully you can sort of… I wouldn’t say hesitate to use the word manipulate, but you’re effectively trying to manipulate the setup to create a scenario where Parliament can proactively exercise oversight over these bodies rather than just being reactive when things go wrong.

Why Democracy Feels Broken

FRANCIS FOSTER: So is that partly the reason why people are so frustrated with democracy? And I understand this because I am as well. Where they elect governments, governments say they’re going to do something, for instance, immigration, it doesn’t happen. And then people are going, “well, what’s going on?”

KATHRYN PORTER: Oh yeah, well, Tony Blair embedded human rights legislation in a whole raft of different legislation. So whenever you want to do something, you’ve got to then address the fact that it’s not just one area of law that you have to think about, it’s a massive areas of law because he puts it in so many different pieces. So many acts of Parliament have these human rights elements embedded in them. So unpicking that is really difficult.

And this is when I’ll come back to the comment that can be made about taking prosperity for granted. When we have created all of these regulatory structures, we can’t deport people because of the way the human rights law is being interpreted. We can’t build stuff because everything gets JR’d by environmentalists.

And in an effort to reduce the risk of judicial review, everybody creates masses and masses of paperwork because that makes any judicial review a lot more expensive and so it makes it less likely to happen. So it’s the defensive measure.

Sizewell C, the Office for Nuclear Regulation said that they would really not say anything if Sizewell C was an exact copy of Hinkley Point C. So from a nuclear perspective, it would just be green lit. Sizewell C is exactly next door to Sizewell B and the decommissioned Sizewell A. And yet there was something like 40,000 pages of environmental statements to explain how this reactor, which is identical to another one elsewhere in the country, exactly next door to an existing reactor, was going to impact the environment.

Like this should have been two pages to say how it was different from Sizewell B. And yes, it was 40,000 pages. Now 40,000 pages, that’s… you know, I can say that’s 40,000 pages. But actually doing 40,000 pages, that involves a lot of people, a lot of costs, a lot of time. And then you wonder why we’re spending £35 billion to build nuclear reactors when KEPCO in South Korea is spending between 5 and 6 billion US dollars.

FRANCIS FOSTER: So the whole system is essentially been ground to a halt. Yes, on everything. Because of legislation put in by New Labour, the Labour government at the time. Which just means that everything has come grinding to a halt so that nothing can get done.

KATHRYN PORTER: Yeah, but I come back, the Conservatives contributed to this.

KONSTANTIN KISIN: Well, this is what I was going to say. They had 14 years. We can’t overlook this, Kathryn.

KATHRYN PORTER: We can’t. And so, but the… Because they were like the frogs in the pot of boiling water, they didn’t understand how corrupted the civil service was becoming until they left office. And I do sympathize with that. But they were fully on board with this whole regulating everything, independent regulators and all the rest of it. So that was separate.

So you had this ideology of having non-democratic bodies that were supposed to be populated with technical experts really making key decisions. So that bit they were responsible for, but then they were making decisions themselves based on bad information that they didn’t know. So I think the first they’re responsible for, the second, not so much.

Conservative Election Prediction

KONSTANTIN KISIN: Well, since we ventured into the realm of politics before we started, you actually said something that triggered Francis.

FRANCIS FOSTER: It’s still taking me time to recover.

KONSTANTIN KISIN: The most controversial thing that’s been said on the show for a while, which is… You think the Conservatives are going to win the next election?

KATHRYN PORTER: Yes.

FRANCIS FOSTER: Going to drive me back to drink?

KONSTANTIN KISIN: Explain.

KATHRYN PORTER: Well, I think historically we’ve seen the Conservatives win elections when the polls have said otherwise. And part of that is because people feel embarrassed admitting to pollsters that they’re going to vote Conservative. And partly it’s because I think when push comes to shove, people can hate the Conservative but still think they’re more responsible and trustworthy. And I don’t mean trustworthy in a kind of integrity sense. I mean trustworthy in the sense of less likely to screw up the economy than anyone else.

It’s an unfortunate thing that everyone’s forgotten that the country had no money in 2010. There was a Labour… The Labour Chief Secretary of the Treasury left a note that said “the money’s all gone now.” Everybody’s forgotten about that. And Labour now blathering on about black holes and stuff. Well, Conservatives faced one of those when they came in and of course they had to go through Covid as well.

The economic impact of COVID had we had a Labour government would have been even worse because they wanted more lockdowns, more furloughs, more everything. So I totally get that. People voted the way they did in the last election, partly because of massive fatigue after 14 years of… of misery. But 14 years. That 14 years included a chunk of austerity that was a response to Labour’s poor management of the economy and then Covid. So they were not really things that were within their control.

And I think now everyone’s realizing just how bad Labour is. Yes, there’s an appeal with Reform, but I think the problem there is Reform haven’t yet shown themselves to be a grown up political force. So they come out with policy initiatives that are… I would say they prematurely come out with these initiatives that they say things like, “oh, we’re going to tax away the subsidies that renewable generators get under the contract for difference.”

Well, you can’t do that because those contracts have a change of law provisions in them that would compensate the generators for exactly that sort of thing. So saying that’s what they’re going to do, that’s unworkable. They should take their time to figure out what will work.

And so people are getting a bit frustrated that the Conservatives aren’t being more clear about their new energy policies. But that’s because they’re really doing their homework behind the scenes. So I have some visibility on that. And I can see that they’re putting in the work in a good faith way. They want to get it right in normal circumstances.

We’re still four years away from a general election. I think we might actually have one before then. But under normal circumstances, they don’t really need to start getting really detailed with policy for another three years when they start putting the manifestos together.

KATHRYN PORTER: That.

Political Realignment and Conservative Challenges

FRANCIS FOSTER: Are you not factoring in? So for example, my dad, who is a floating voter but he’s center right and has voted conservative for most of his life, he said to me after the previous 14 years he will never vote conservative again. I think there are quite a few people like my father up and down this country.

KATHRYN PORTER: Yeah, but people can change their minds. I think what the conservatives need to do is start making sure right now that people understand the extent of the problem with the civil service and start warming people up that we need to radically reform the civil service and really, that was a huge barrier to delivery under the previous Conservative government.

And in fairness, Labor’s facing those same barriers to delivery. Labour’s talking about getting rid of the blockers, for example. Well, some of those blockers are the Civil Service, and that is not a straightforward thing to unpick that.

Now, I don’t think Labour really appreciates the extent of the challenge, but the Conservatives do. And I think reform has to be on the same page with this as well, that they need to start warming the public up, that in order for any government to be effective, you’ve got to take back control of all of these arms of the state.

And so that’s going to require legislation. It really needs to be in people’s manifestos. And it’s not too early to start talking about that. I think once the Conservatives start setting out their new policies, their new vision for the country, if they’re sufficiently radical with that, then I think people who had said, “well, we never vote for them again,” might very well change their minds because they do have a track record of not completely destroying the country.

KONSTANTIN KISIN: Well, and also.

KATHRYN PORTER: Sorry, I would just say that we’ve seen the Lib Dems do very well historically in local elections and fail to translate that at Westminster. Reform could very well end up in the same boat.

KONSTANTIN KISIN: Lib Dems has never polled at the top of the polls, right.

KATHRYN PORTER: No, but we’re so far away right now. You know, even if a pollster says to you, “if there was an election tomorrow, who would you vote for?” That still isn’t really true. You can’t place any reliance on that.

The Last Chance Saloon

KONSTANTIN KISIN: I guess the thing. I think the part of the reason for the appeal of reform is my sense of it is it sort of feels like we’re drinking the last chance saloon. Yeah. Economically, from an immigration point of view. I mean, the country just demographically is changing so rapidly because of mass immigration. A lot of people feel like the country they grew up is just. It’s not salvageable, you’re not getting it back.

KATHRYN PORTER: Well, I think people are seeing a feeling of unfairness.

KONSTANTIN KISIN: Yeah.

KATHRYN PORTER: Because they’ve seen a big erosion in their standards of living. And that’s difficult. Right. But that probably wouldn’t really anger them, except they see these people arrive illegally on boats, no records of who they are, whether they’re criminals or good people. They’re mostly young men from countries that don’t share our cultural values.

People get put into luxury accommodation with instant access to NHS doctors, they get instant access to NHS dental care. Now, if you’re homeless person, say a single mother with two children made homeless and you approach a council for somewhere to live where you’re going to be put on some lists, you’ll be put in a B and B. It’s definitely not luxury accommodation.

You’re a UK taxpayer, you want to see a GP, you’ve got to do the 8am phone rush and maybe if you’re lucky, you’ll get an appointment in three weeks. You want to get an NHS dentist. Well, good luck with that, because there’s large parts of the country, it’s just not even possible.

So then you see your standards of living falling and these people turning up and they get this preferential treatment. And I think that is making people very angry. And I think Labour’s playing with fire here because instead of listening to people’s concerns, they’re branding them as far right extremists.

KONSTANTIN KISIN: They’re starting to get it. I see a lot of people now kind of go, suddenly they’ve all realized the ECHR might be a bit of a problem.

KATHRYN PORTER: Well, yeah, I know, but the. So because they’re starting to see the extent of the opposition in the red wall. It is not far right to be upset that immigrants get better treatment than.

KONSTANTIN KISIN: Citizens, especially illegal immigrants.

KATHRYN PORTER: Especially, especially illegal immigrants. Right. But any sort of immigrant. But particularly illegal immigrants. So I think what’s driving a lot of the anger is this sense of unfairness.

Now, I think in general terms, it’s quite difficult to get British people riled up. It’s why we’ve never had a revolution. And I know periodically we’ll have riots and that tends to be in the summer and then it rains and everyone goes home and everyone forgets about it.

I think if going into the autumn, if we start seeing that sort of activity in something other than hot weather, that’s going to be a huge problem. And by trying to restrict free speech and trying to stop policing speech, rather than hearing people’s concerns, labor is pouring oil on those flames. They are. So they are making this into a very dangerous situation.

And I really hope that they stop, because I’m not an anarchist. I know it can be quite fun to go, “oh, we’ll have some anarchy,” but in real life is not terrible. And so it’s not something that we should be desiring in any way, even if it probably would prompt an early general election. That is just the worst way to go about it.

Economic Solutions and Energy Reform

KONSTANTIN KISIN: Absolutely. And this is why I wanted to bring up the economic situation, because part of the problem here, Kathryn, I may be misreading this, but correct me if I’m wrong, given that we have all of these things embedded in a way that we can’t really see in terms of the subsidies, the levies, etc. If you get rid of that, you’re going to have to find the money somewhere.

KATHRYN PORTER: Yes, so there are some ways of dealing with it. The first thing we need to do is to strip back energy supply. So it’s about energy supply and not social engineering or any of the other stuff that they’re doing. I mean, the energy company obligations. Another stupid one. Suppliers are supposed to help people install insulation. Like what do suppliers know about insulation? Let’s just call of nonsense. Right, so, and smart meters, right? No other country has suppliers installing smart meters. It’s network equipment that’s installed by network companies. Duh.

You know, so in the same way that the GP patient relationship gets abused by the government, the supplier consumer relationship gets abused by the government, so you want to strip back the job of suppliers to be about supply. And so that means moving all the levies into taxation.

Now, yes, you’ve obviously got to then raise taxes to cover it, but actually it’s less regressive than the current method because people on the lowest incomes don’t pay income tax, for example, so they would then not have to pay those levies and that would be fairer. So simplify the supply segment.

Now, there is some stuff you can do to reduce those levies. The legacy renewables obligation, you can use statutory instruments to change the parameters of that to cut costs. Some of the older projects, for example, would receive three rocks per megawatt hour. They should only get one, so cut that. And I think that’s pretty straightforward.

And yes, they might try and take it through the courts, but there’s pretty well established case law that you’re not entitled to continue receiving windfall gains. And I think if you’re getting three and other people are getting one, you can call that a windfall gain. So I think that’s pretty straightforward.

And also you can start eroding the value of those and also change the indexation. So they’re indexed to RPI, which means that in real terms, because it should be CPI, even though this is a legacy scheme, and so year on year projects are rolling off because their subsidies expired. The actual cost of the consumer is going up because they’re using the wrong indexation. And that’s still going to carry on until, I think, 2037.

So, yeah, that incorrect indexation is worth again, billions of pounds a year. So that should be changed. And also, I don’t think there’d be any legal way of really opposing that by the generators. You just call it a windfall gain that they’re no longer receiving. So there are some ways that you could cut money out of that relatively easily.

Nuclear Power Solutions

Then you’ve got to address the capacity shortages going forward. So we should do what works. KEPCO can build its reactors in under 10 years at a cost of 5 to 6 billion US. I would pass a law that says we’re going to build this reactor on this side. There’s some negotiation to be done with Westinghouse because under their agreements with KEPCO, KEPCO is not supposed to sell its stuff in Europe. But I think we can get around that. The Westinghouse design isn’t as good. So use the KEPCO one, which is based on Westinghouse but a bit different.

Pass a law that bypasses all of the regulatory processes and go to the bond markets and say we’re going to build these reactors with public money and refinance after construction because there’s construction risk that investors are scared of. Nuclear power stations are very profitable to run.

So this is a great story that the bond markets will buy. You issue specific nuclear bonds, 10, 15 year bonds that you refinance at the end of construction, and then happy days. You’ll have plenty of people wanting to buy into those assets. And in fact, you could even do a public share subscription at that point as well. Because why not have the public own a stake, just the way they did a privatization? I think people would be queuing up for it. It’ll be the next Tulsa.

So that gets you nuclear. I think we might have to bite the bullet and look at coal because you can build. So my understanding is the lead time for a coal turbine is three years. If you’re looking at eight years for a gas turbine, you might just have to bite the bullet and do that. But then we can start mining our own coal again. That would have an economic benefit.

FRANCIS FOSTER: Right? You’ve said all of these things and I agree.

KATHRYN PORTER: The energy profits levy and go gangbusters in the North Sea as well.

Conservative Party Challenges

FRANCIS FOSTER: And I’m sure they’re great and they will all work. I look at the conservatives, not all of them, but a lot of them. And a lot of them are still on the net zero train. A lot of them are still profoundly woke. A lot of them, if you probably ask them, there’ll be a good selection. Probably still don’t know what a woman is even now. And so that being the case, I think are they going to do these policies? Are they heck.

Conservative Party’s Energy Policy Approach

KATHRYN PORTER: Well, so I’m more optimistic about it. I mean, I think Claire and her team are very much on board with what I’ve been saying and I think Kemi is on board with that as well. She’s got to persuade people, as you say, there are people in the party who are still very much wet liberals and my view is they should join the Liberal Democrats if that’s what they are.

But that’s a process, right? She’s taking the time that she has to really make sure that she’s on top of what the policies need to be to get a defensible position that makes sense, that stacks up, that people with real world experience will get behind and then sell that both to the skeptics in her party and the public more broadly.

And that process takes time because they were really shocked when they left office and they realized the extent to which they had not been given proper information. And Claire, when she was coming to the end of her time and she wasn’t energy secretary for very long, she’d asked the civil service to do a cost of energy project instead of looking at levelized costs, to look at the full system cost.

So all of that stuff I talked about, not just the subsidies but the backup costs, the balancing costs, the extra connection costs, all of the full cost to the consumer of building renewables and compare that with the full cost of the consumer of every other type of generation.

And that’s a little bit tricky to do because if you look at nuclear, for example, nuclear is required to have fully funded decommissioning plans before they even get built. Like no other technology is required to even have a clue what they’re going to do for decommissioning, never mind fund it. So there’s quite a big asymmetry in that that adds cost to nuclear that other generation doesn’t have but to try and create a level playing field so people can understand exactly what are the relative costs of all these generation technologies. Miliband cancelled that project. So why would you not want to know that information?

FRANCIS FOSTER: Because you’re ideological and it would contravene your ideology.

KATHRYN PORTER: Exactly. But the conservatives didn’t have that information because they’d asked for it, but they didn’t get it. So now they’re taking the time to try and get it. But of course they don’t have the staff that they had when they were in government. They don’t have a civil service. They are now relying on either the goodwill of people like me to just help them out or where they can pay for stuff to be done to pay for it. But it’s nothing like on the scale of when they had civil servants providing them with information.

The Challenge of 14 Years in Power

FRANCIS FOSTER: But you see, I think this is another reason why people be attracted to reform, because they will say the Conservatives were in power for 14 years. And I take on board your argument, Claire, I really do, but there’s a part of me that smells a rat. Was like, you’ve been in power for 14 years.

KONSTANTIN KISIN: He’s talking to the minister now.

FRANCIS FOSTER: Yeah.

KONSTANTIN KISIN: Not to you.

FRANCIS FOSTER: But you’ve been in power for 14 years and you haven’t worked out you were being lied to.

KATHRYN PORTER: Well, no, because if you’re inside the wall, and just bear in mind as well, look, ministers do two jobs. They’re constituency MPs as well as ministers. That’s a huge, huge pressure to put into people. Is it really reasonable to expect people in that scenario to be second guessing every bit of information that their officials are presenting them with?

KONSTANTIN KISIN: Especially if they don’t have the scientific training, as you say?

KATHRYN PORTER: And just how exhausting would that be as well? Yeah, you know, former ministers have said to me that typically civil servants will come with two or three or four proposals, alternatives, and then you’d be expected to choose from one of them. And he said often he felt that he needed to send them away and make them come back with a new set.

How exhausting would it be if you were day in and day out, “no, go away, do that again. Give me another set. I don’t like that.” So even if you were on top of it, that is quite a difficult thing, just from a human perspective to be doing day in and day out. Just that interaction where you’re effectively saying to somebody, “your work’s not good enough,” day in and day out.

KONSTANTIN KISIN: No, I’d love that. And then you get accused, even I wouldn’t. And then you’re bullying.

The Nature of Political Service

KATHRYN PORTER: So it’s a really… Look, I think, and I know not everybody agrees with this, but I generally think that most people go into politics because they have a sense of public service. I don’t think the majority are in it for venal reasons or vanity reasons or whatever. And so I think most of them are sincerely trying to do what they think is right and they’re sincerely trying to be good people. Now, not all of them succeed, obviously. And you have corruption and bad behavior.

But I think in general they’re just decent people trying to do the best they can, but they’re not necessarily having the right qualifications and they don’t necessarily have access to the right information. And then some of them have ideologies as well, less sympathetic to the ideology bit, to be honest.

But I think we do have to give them some benefit of the doubt and we particularly, I think have to give them the grace to change their minds. Because just to say, “oh well, conservatives, you did all these dangerous net zero things for 14 years. That means that you can never change your mind and we’re just never going to believe anything you say.” Well, kind of what’s the point?

If you’re not going to let people change their minds, then people will just get entrenched in their opinions, they’ll never listen and you’re never going to move forward in a constructive way. Yeah, I think you’ve got to do the sunk cost thing that’s been and done now. How do we go forward in a productive way?

Reform Party’s Implementation Challenges

KONSTANTIN KISIN: Those are all fair points. I guess the reason that it’s somewhat different this time, I feel, and I’m not advocating for reform or against reform, I just kind of observing the lay of the land as it is at the moment. Many people will say, well look, if you just have the two main parties. Yeah, then you’ve got the conservatives have changed their mind. That’s wonderful. What you have now is another party to which the ideas you’re talking about are native, effectively. Right. Skepticism about net zero, which was until very recently the prevail.

KATHRYN PORTER: So their weaknesses on implementation, tell us about that. So they don’t know how to implement it. As I said, Richard Tice saying, “oh well, we’ll tax away the contract for different benefits.” Well, you can’t do that because of the make whole provisions in the contracts. So that implementation piece isn’t there for that.

They’re very keen on fracking. I keep trying to explain to them that we don’t have proven frackable resources. We have potential, but nothing’s proven. The appraisal work hasn’t been done. I speak to some geologists who say, “absolutely, we could frack loads of gas, it would be super cheap. It’s going to be a game changer.” I speak to other geologists who say the exact opposite. “No know our geology is too difficult. We won’t be able to extract lots of gas through hydraulic fracking.”

The only way to resolve this is to lift the restrictions that we have to put in place much more sensible limits around seismic activity because I think at the moment it’s 0.5. Well, that’s like dropping your pen on the floor. It needs to be more like three, three and a half, which is like your cup will rattle in the source of. You start to get structural damage at 5. But this is a logarithmic scale, so each point is 10 times bigger than the point before. So 5 is 100 times bigger than 3.

And also you need some sensible restrictions around water use because we don’t have lots of spare water to use for this. So you need some sensible restrictions about that. But beyond that, the market should just be allowed to investigate, let them put up their own capital, explore whether it’s viable. If it is brilliant, happy days, let’s use it. And if it’s not, well, never mind. At least we know thus. But reform seems to be very stuck on this, that, “oh yeah, we should do fracking and it’ll be amazing.”

Small Modular Reactors: Promise and Challenges

And we should have SMRs. Well, SMRs are also a decade away, so we need stuff now, we need stuff to be started to be built now, not started to be built in 10 years. So yeah, I’m absolutely fine with the idea of SMRs, although I do think there’s a piece of safety case that we haven’t properly addressed as in. So they’re not in themselves more dangerous.

But the idea is that you co locate them with industry, so the industry tends to be dangerous as well. Normally with nuclear reactors you have an old constabulary and heavy security. How do you scale that down? And when you’re co locating nuclear stuff with already dangerous stuff like a chemical factory, well that would be quite an attractive target to bad actors. So like even if they came in and tried to blow up the nuclear bit and succeeded in blowing the chemical bit, that would be really bad. Right. So you need to think about how you’re going to manage that and make it cost effective. And nobody’s really looked at that yet.

But yeah, I mean, I’m perfectly fine with the idea of small reactors. I just think that we need big ones as a higher priority because we know how to build them, we don’t know how to build the small ones. Nobody in the west has managed to build a small modular reaction. The Canadian SOG and Hitachi have just started construction in Canada of small boiling water reactors and that’s it.

And you can’t use the ones that Rolls Royce has in submarines because they use highly enriched fuel that’s not licensed for civil use anywhere in the world because of proliferation concerns. So it’s an entirely different design that they’re having to work on.

Cross-Party Engagement

KONSTANTIN KISIN: Well, hopefully people are listening across the parties, like, I don’t really care about the parties, I care about the policies. So I hope Labour and Lib Dems.

KATHRYN PORTER: Are listening to this.

KONSTANTIN KISIN: And actually me too, and I think.

KATHRYN PORTER: People from parties that I would normally not be that interested in approaching me and I will speak to anybody. So I know I’ve probably come across as quite pro the Conservatives. I am impressed with the way they’re approaching this because I am talking with them and I can see a little bit of what they’re doing. And if they’re doing similar work in other sectors to what they’re doing in energy, then I think that’s really positive and we should be encouraging that, really. We should be supportive of people who were trying to make a good faith effort to get it right. If Ed Miliband phoned me up and said, “can we talk?” then I’d happily talk.

KONSTANTIN KISIN: No, he’s a big fan of the show, so I’m sure you’ll be getting.

KATHRYN PORTER: A huge fan of mine, obviously.

The Real Issue: Civil Service Reform

KONSTANTIN KISIN: Kathryn, it’s been great having you on. Thank you for giving us some of the detail on this stuff. It’s really, really important. And I just think not enough people realize why things are so difficult to build in this country, why our energy prices are as high as they are, why our industry is declining as it is, and all of these other things that really are very, very important. So thanks for coming on. We’re going to head on over to Substack to ask you questions from our supporters. Before we do, though, what’s the one thing we’re not talking about that we really should be?

KATHRYN PORTER: Well, I mean, it was the civil Service piece, the fact that the government doesn’t run the country. I think people need to understand that, that we have to have radical reform of the civil service and these different arms of the state that were set up to be independent, but that has led to lack of accountability.

KONSTANTIN KISIN: Kathryn, thank you very much. Head on over to Substack where we’ll ask Kathryn your questions. Can you talk about the direct relationship between per person energy consumption, consumption and living standards?

Related Posts