Fracking

Many plaudits this morning for ministers such as Michael Fallon who have catalysed the government's push ahead with fracking. The only question, though, is whether enthusiasm in Whitehall will translate into enthusiasm in local communities. Ministers are pointing to a change in the incentives for communities which means they can now keep 100 per cent of business rates from extraction sites. But it certainly hasn't impressed Ben Wallace, the Tory MP for Wyre and Preston North, who is a vocal spokesman for the group of MPs whose constituencies sit on the Bowland Shale. Wallace tells me: 'What they are offering us today - an extra £850,000 of business rates is pathetic, insulting. The Treasury should take a little less and we could have a little bit more.

It is ‘immoral’, asserted Michael Fallon at this week’s Spectator energy conference, to force basic-rate taxpayers to subsidise wealthy landowners’ wind turbines and the solar panels of well-off homeowners. It is hard to remember the last time a minister was so frank about something which had been government policy until a few hours earlier. As a result of changes announced by the government this week, consumers will save £50 a year compared with what their bills would have been. The cost of supporting energy bills for the poor will be shifted from energy bills to general taxation, and the obligation on energy companies to subsidise home insulation will be watered down.

At last night's Spectator debate, the audience voted dramatically in favour of the motion Let’s Get Fracking! Despite impassioned speeches from Green party leader Natalie Bennett, Greenpeace’s Joss Garman, and Craig Bennett from Friends of the Earth, the crowd sided with Conservative MPs Peter Lilley and John Redwood and the energy consultant Nick Grealy, who said that it’s time for Britain to ‘peek into this Pandora’s box’ and at least explore the possibilities of shale gas. Peter Lilley opened the debate with a joke at Chris Huhne’s expense: ‘in my view he should have been jailed not for driving too fast but for driving the development of shale gas too slowly’.

The energy debate is in stasis. Everything, it seems, hangs on the contents of the Autumn Statement. EDF has announced a price rise; bills will go up by an average 3.9 per cent, which is considerably lower than the rest of the Big Six. Yet the company made clear that maintaining low prices will depend on George Osborne. A spokesman said: ‘If the Government makes bigger changes to the cost of its social and environmental schemes than EDF Energy has anticipated, the company pledges to pass these savings onto customers. However, if changes to social and environmental programmes are less than anticipated, the company may have to review its standard variable prices again.’ That statement is even more nebulous than it first seems.

In the days before Ed Miliband went all Marxist/brave on energy (delete as tribally appropriate), the debate around energy was more about fracking than it was about freezes. Shale gas has taken a back seat while ministers wonder what on earth they can do about bills to take the wind out of the Labour leader's sails. But the political problems haven't gone away. The debate is still about whether the incentives on offer are enough for local communities to accept fracking pads in their area. MPs whose constituencies sit atop the Bowland Shale don't think the government is offering enough, and have continued to tell the Prime Minister that. He recently held a meeting with MPs interested in fracking, but those who attended complain that they got little out of it.

Caroline Lucas' arrest this afternoon at the Balcombe fracking protest might be quite useful for the Green MP, but it's hardly going to give ministers a sleepless night. Lucas' presence is actually rather distracting from a real problem that ministers do need to address: ensuring that communities feel they have a stake in the shale gas exploitation taking place on their doorstep. David Cameron rather got their hopes up recently when he, by a slip of the tongue, promised that communities would get a £1 million incentive for accepting drilling on site when the figure was actually £100,000.

A few months after the last election, Oliver Letwin warned Cabinet colleagues that a chunk of Britain’s income would be gone for good after the economic crisis. Letwin, who has always been the Cameron project’s in-house intellectual, told them that some of the complex high finance in which Britain had specialised was never coming back. We would have to develop a new form of economic activity to make up for the loss. The good news is that this new form is looming into view. Fracking the Bowland Shale alone will, on a relatively cautious estimate, produce the equivalent of 90 years of North Sea gas production.

‘We are going to see how thick their rectory walls are, whether they like the flaring at the end of the drive!’ Said Michael Fallon in jest at the expense of supporters of fracking in the Home Counties. As it happens, our very own Charles Moore lives in a rectory in East Sussex. He wrote this in the Spectator a few weeks back: ‘Another great advance for the environment is shale gas, though for some reason Greens do not see it that way. It will make us — and has already made America — far less dependent on high carbon-emitting sources of energy. It is lucky for those trying to extract it in this country that it is in places like Ellesmere Port and Blackpool where there are not many spoilt, rich people to complain about damage to the landscape.

An old Washington cliche has it that a gaffe is what happens when a politician inadvertently blurts out the truth or, in a variation on the theme, reveals what he really thinks. Enter Lord Howell. In ordinary circumstances Peer Says Something Daft might be thought as newsworthy as Friday Follows Thursday but Lord Howell is not some backwoods eccentric. He's a former cabinet minister and, more pertinently, George Osborne's father-in-law. Perhaps this should not matter but it does just as there's a certain frisson felt when David Cameron's father-in-law criticises government policy.