Energy and the UK OBR Fiscal Sustainability Report

The second Fiscal Sustainability Report published by the UK Office of Budget Responsibly appears to make no reference to energy other than to falling North Sea Revenues. Important though this is, it is the statement that productivity will continue to increase at the long run 2%, without justification, that is the critical issue.

Productivity has been, and is, intensely energy dependent and here is significant discussion about the amount of easily won energy moving forward from this point, and the value of the useful net energy it yields; not least within the International Monetary Fund.

Energy use and GDP are historically closely correlated and projections that ignore this are suspect at best and probably meaningless.

This a strategic mistake as it fails to focus the available National creativity on the search for energy and resource intensity reduction in UK economic activity at system level.

At the moment, all efforts are aimed at marginal energy and resource intensity improvements at micro level.

dd

See also Energy, economy and the impending rite of passage

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