At the top of the news this week is the VW diesel emissions scandal, which among other things draws attention to the failure of attempts to cut carbon emissions via mass conversion of vehicles to “clean diesel”.
Bloomberg: Climate Politics and the Volkswagen Scandal
A third scandal, even more costly than the first two, also needs to be noticed and examined. It concerns the economic and environmental policies that first set European car manufacturers and consumers on course to this pile-up. Remember that “clean diesel” was a government-led initiative, brought to you courtesy of Europe’s taxpayers. Beginning in the mid-1990s, mindful of their commitments to cut carbon emissions, Europe’s governments embarked on a prolonged drive to convert their car fleets from gasoline to diesel. With generous use of tax preferences, they succeeded. In the European Union as a whole, diesel vehicles now account for more than half of the market. In France, the first country to cross that threshold, diesel now accounts for roughly 80 percent of motor-fuel consumption. What was the reasoning? Diesel contains more carbon than gasoline, but diesel engines burn less fuel: Net, switching to diesel ought to give you lower emissions of greenhouse gases. However, there’s a penalty in higher emissions of other pollutants, including particulates and nitrogen oxides, or NOx. Curbing those emissions requires expensive modifications to cars’ exhaust systems. To facilitate the switch, Europe made its emission standards for these other pollutants less stringent for diesel engines than for gasoline engines. The priority, after all, was to cut greenhouse gases. Except that the switch to diesel probably didn’t cut greenhouse gases.
The usual mix of stories below the fold – conventional O&G projects under threat, Russia considers breaking Gazprom’s export monopoly, a court orders Pakistan to take measures against climate change, Norway to cut gas pipeline tariffs, how international trade agreements could derail the Paris Climate Conference, renewables outstrip coal in UK, Drax to abandon CCS, investors shun Hinkley, a mobile renewable energy generating plant (with diesel backup), the Trinity portable wind turbine, a grim picture in the North Sea, the record hurricane drought in US continues, how the sun controls Antarctic climate and how global warming is shortening the tongues of bumble bees.
Despite efforts to cut costs, the petroleum industry can’t make money on $1.5 trillion in pending investments on conventional and North American shale drilling projects with $50 oil, Wood Mackenzie estimates. The estimated $1.5 trillion in oil projects represent prospects that drillers haven’t yet sanctioned for investments. With oil at $50 a barrel, “this spend is very much at risk,” said James Webb, Wood Mackenzie upstream research manager, in a written statement. “A prolonged period of low oil prices over a number of years is likely needed to bring about profound, structural changes to industry costs,” Webb said. But Wood Mackenzie believes prices will start a recovery in 2017, likely pushing costs toward levels before the oil price slump. The oil industry has cut an estimated 196,000 jobs worldwide since the oil bust began, with nearly half of that figure squeezed out of the oil field service sector, according to energy consultant Graves & Co.
Oil prices are back on the rise after more evidence emerged that Opec’s war on its supply rivals is taking affect. Brent crude for October delivery surged 2.5pc in London after the latest report on the number of drilling rigs in the US showed another sharp decline. Only 644 oil rigs are actively operating onshore in the US, down 57pc from the end of December as drillers cut back in response to oil prices sinking below $50 per barrel. Analysts are now concerned that the pace of rig shutdowns in the US could accelerate after operators resisted the need to cut back in the hope that prices would return to higher levels. Commerzbank said: “We actually believe that the decrease in US oil production will pick up pace in the near future: for one thing, hedging deals agreed at higher oil prices are expiring, while for another the low chances of the environment improving in anything like the near future are likely to prompt creditors to pull the ripcord.”
Financial Times: North Sea oil report paints grim picture
North Sea oil explorers will find it almost impossible to make any money without further severe cost cuts, according to one of the Scottish National party’s favourite oil economists. Alex Kemp, professor of petroleum economics at Aberdeen university, issues his warning in a paper published on Wednesday that will make grim reading for oil companies, the Treasury and supporters of Scottish independence. Mr Kemp and his colleague, Linda Stephen, say that only by implementing cuts of between 20 and 30 per cent can explorers begin to make money out of the oil they are hoping to find. The report is another illustration of how difficult it is to do business in the North Sea since the oil price slumped from $115 a barrel last June to approximately $50 a barrel now. Exploration has been one of the principal casualties in the North Sea oil sector from the falling price of crude. New sources of oil have become increasingly hard to find after 50 years of drilling: from 2012 to 2014, only 10 per cent of the oil that was running out was being replaced by new finds.
Wall Street Journal: Investors Lose Gas Pipeline Fight With Norway
An Oslo court ruled on Friday the Norwegian government can cut tariffs on a gas pipeline network owned by some of the world’s largest investors, in a judgment that could cost these funds almost $2 billion in lost revenue. The case has been described by some investors as a landmark decision that could add uncertainty to infrastructure investments in countries long deemed as being investor friendly. The court upheld the Norwegian government’s 2013 decision to slash tariffs by as much as 90% for transporting natural gas on the Gassled network that hooks up North Sea oil-and-gas fields to terminals around Europe. The government had argued that cutting the tariffs would boost exploration and development for the local oil-and-gas industry, currently under pressure from low commodity prices. A group of Gassled investors, including Germany’s Allianz Capital Partners GmbH, Canada Pension Plan Investment Board—Canada’s largest pension fund—and Abu Dhabi’s sovereign-wealth fund, had sued, arguing in court papers the tariffs were set under “agreed and crucial assumptions” during negotiations and should have been fixed until at least 2028. “Of course this verdict will have negative consequences for the investment climate in Norway,” said Kurt Georgsen, chief executive of Silex Gas Norway, one of the investors in the suit, which is fully owned by Allianz.
Stratfor: Gazprom Promotes Nord Stream II
Gazprom’s proposed Nord Stream II pipeline is part of the Russian natural gas firm’s new European strategy. Previously, Gazprom pursued a divide-and-conquer strategy that involved reaching bilateral agreements with individual countries. Gazprom’s new strategy appears to focus on flexibility in supply routes, markets and possibly even pricing; on dealing with the European energy market as a whole instead of piecemeal; and on leaving natural gas on Europe’s doorstep to be transported to market through internal European pipelines. Western Europe’s natural gas supplies from the North Sea, particularly from the United Kingdom, are in decline and could fall by at least 50 bcm over the next 20 years. By building an export pipeline to Western Europe, Gazprom can send more natural gas directly, avoiding the hefty transit fees that come with sending natural gas through multiple countries. Considering the decline in North Sea production, Gazprom has even considered building a pipeline spur to the United Kingdom. The lack of transit fees and the shorter route from Russia’s natural gas fields to Gazprom’s customers would put the company in a position to undercut more expensive remote offshore fields in the Norwegian and Barents seas, unconventional natural gas development in the United Kingdom and emerging liquefied natural gas exporters such as the United States. Even if Russian natural gas were uncompetitive, the state-owned Gazprom could still flood the market for political reasons as a way to discourage Western companies’ investment in other energy projects in and around Europe.
Russia is looking at allowing companies other than Gazprom to export natural gas, Energy Minister Alexander Novak said on Thursday. Russian energy giants, including the world’s top listed oil producer Rosneft and gas producer Novatek, have long been vying for lucrative exporting rights. Gazprom, Russia’s top gas producer, has had the pipeline gas exporting monopoly since 2006, generating more than half of its revenues from selling gas to Europe. Rosneft and Novatek have already successfully challenged Gazprom’s monopoly to export seaborne liquefied natural gas. Rosneft has claimed that in order to make its far-flung gas projects in East Siberia viable, it should be allowed to export gas.
China is expected to be allowed to build a nuclear power station in Essex as George Osborne embraced the world’s most populous country as an ideal partner for British business. The chancellor, on a trade mission to the country, argued that Britain should “run towards China” to help boost the UK economy and signalled that China could build a nuclear site in Bradwell, Essex, as part of a wider nuclear co-operation worth tens of billions of pounds. Speaking at a press conference, Osborne sidestepped concerns over Downing Street’s growing proximity to Beijing. When asked about what US officials have called Britain’s “constant accommodation” of Beijing, Osborne added: “I think it is important that, as China grows, it rightly takes its place at the top table.” The Bradwell site is owned by EDF, the French energy company. EDF is also the lead partner with two Chinese companies in the building of Hinkley Point C in Somerset, the first nuclear power station to be built in Britain for a generation – and on Monday Osborne unveiled a £2bn loan guarantee for the plant.
Investors don’t want to put their money into the proposed £24.5bn Hinkley Point nuclear plant because they fear it will suffer cost overruns and delays, the boss of EDF has admitted. The troubled European Pressurised Reactor (EPR) technology that is due to be used at Hinkley is to be ditched by EDF for future projects in France in favour of a cheaper and better model the company is now developing, Jean-Bernard Levy, the French energy giant’s chief executive disclosed. Major problems in the construction of the EPR at sites in France and Finland – which have seen costs spiral and timescales slip – have made would-be investors wary of backing Hinkley, Mr Levy said. EDF has repeatedly insisted it has learnt the lessons of the problems elsewhere but in a frank interview Mr Levy acknowledged investors were not convinced. “For third parties observing the announcements of delays and cost overruns for the EPRs under construction, it is difficult to commit,” he told French financial daily Les Echos.
Vincent de Rivaz, chief executive of France’s EDF Energy, told the BBC the project was not too expensive. He said power from nuclear plants would cut bills compared with low carbon without nuclear power. The project has come under fire for both its £24.5bn cost and delays to investment decisions and the timetable for building. Another controversial issue is a government guarantee that EDF will receive £92 per megawatt hour, twice the current wholesale price for power. EDF said it needed that because the price of energy would be much higher in the future: “You cannot compare the price in the next decade with the price of today, which is being depressed by the current low price of gas. We have to protect ourself against volatility.” Mr de Rivaz said it was a similar situation to a consumer replacing their car with a new one, “more expensive but you will get a much better car”. He rebuffed suggestions that building gas power plants would be more cost effective, saying that would mean the UK importing billions of dollars of gas from elsewhere, putting the country at the mercy of geopolitics.
Renewable energy has for the first time surpassed coal in supplying the UK’s electricity for a whole quarter, according to government statistics released on Thursday. The revelation of the surge in wind, solar and bioenergy to a record 25% comes in a week when the government has been heavily criticised by business leaders and Al Gore for cutting support for clean energy. The high performance of renewable electricity between April and June, the latest period data is available for, was due to both more wind and sun and more turbines and solar panels having been installed, compared to the same period the year before, when renewables contributed 16.4% of electricity. Gas-fired power stations provided the most electricity – 30% – with renewables second. Nuclear power was third with 21.5% and coal – the most polluting fuel – fell back to fourth, with 20.5%. Ageing coal and nuclear plants have been closing in recent years, while renewable energy has been rapidly rolling out.
Ian Marchant hit out at the new Conservative government saying it is “institutionally incapable” of delivering policy which can support the UK’s security of energy supply. “The question is: do we have an energy policy? And the answer is no,” he told delegates of a British Institute of Energy Economics event. Marchant’s criticism follows months of government intervention in renewable energy support through cuts planned for both large and small scale renewables projects. He also slammed the government for failing to provide an impact assessment for its planned cuts to the Renewables Obligation (RO) until two months after its announcement, in what he called a “ready, fire, aim” approach. The need for effective policy to bring forward investment is key, he added. Marchant said the three major coal plant closures which have taken place in recent months contributed 6 per cent to the UK’s generation mix last winter, asking: “Where will that come from now? Since 2010 we have started construction on one CCGT in this country.” Marchant also took aim at the government’s drive to secure investment for the Hinkley Point C new nuclear project, saying its reactor design is too expensive and a “proven failure” in other countries. “It’s an interesting situation for a country to find itself in, saying ‘the first two [reactors] are so over budget and over schedule that we’d like the third, please’.”
Yorkshire Post: Drax pulls out of £1bn carbon capture project
DRAX power station in North Yorkshire has withdrawn from a £1bn plan to build a carbon capture project at its site, amid concerns over Government green policy changes. The “White Rose” plan has been to deliver the world’s first commercial scale, carbon capture and storage coal-fired power plant in Yorkshire on the Drax site. The region is thought to ideally placed to develop this technology capturing millions of tonnes of CO2 each year from large industrial sites and power stations and pipe it out to a facility beneath the North Sea. Drax said it would stil complete the feasibility study on a carbon capture and storage (CCS) project to catch up to 90 per cent of emissions from a power station and store them permanently under the North Sea, but would not invest any further in the “White Rose” scheme. Drax was given European funding for the project, called White Rose, last July. It would have seen a new plant built new to Drax’s existing power station and would create enough energy to power 630,000 homes, with the majority of CO2 transported by pipelines for storage under the North Sea. However the firm has blamed the “drastically different financial and regulatory environment” which has seen the wholesale price of electricity drop and moves by the Government to rein back support for low carbon technology.
The worst nuclear disaster since the 1986 Chernobyl meltdown never should have happened, according to a new study. In the peer-reviewed Philosophical Transactions A of the Royal Society, researchers Costas Synolakis of the USC Viterbi School of Engineering and Utku Kânoğlu of the Middle East Technical University in Turkey distilled thousands of pages of government and industry reports and hundreds of news stories, focusing on the run-up to the Fukushima Daiichi disaster in 2011. They found that “arrogance and ignorance,” design flaws, regulatory failures and improper hazard analyses doomed the coastal nuclear power plant even before the tsunami hit. The authors describe the disaster as a “cascade of industrial, regulatory and engineering failures” leading to a situation where critical infrastructure — in this case, backup generators to keep cooling the plant in the event of main power loss — was built in harm’s way. At the four damaged nuclear power plants (Onagawa, Fukushima Daiichi, Fukushimi Daini and Toka Daini), 22 of the 33 total backup diesel generators were washed away, including 12 of 13 at Fukushima Daiichi. Of the 33 total backup power lines to off-site generators, all but two were obliterated by the tsunami. Unable to cool itself, Fukushima Daiichi’s reactors melted down one by one. “What doomed Fukushima Daiichi was the elevation of the EDGs (emergency diesel generators),” the authors wrote. One set was located in a basement, and the others at 10 and 13 meters above sea level — inexplicably and fatally low, Synolakis said.
For a few hours on Sunday, Paris will grow unusually quiet when it hosts its first car-free day, silencing the usual din of humming engines and honking horns. Between 11 am to 6 pm, designated zones across the city including parts of the iconic Champs-Elysees, the Montmartre area and the trendy Canal Saint-Martin will be closed to traffic with the ex-ception of taxis, buses, emergency vehicles and bikes. Certain roads, including parts of the Champs-Elysees and the Voie Georges Pompidou, which stretches along the Seine on the Right Bank, will also be reserved exclusively to pedestrians. In other parts of the city, traffic movement will be restricted to 20km/hr. The initiative takes place five days after World Car Free Day, which was observed September 22. But unlike many cities where the initiative is voluntary and appeals to drivers’ good will, the project in Paris has the backing of the mayor, who will mobilize city workers to block off the streets and enforce the temporary traffic rules. The move is also part of a major public relations campaign in advance of COP21, as Paris has been spending the past year grooming itself to host the UN climate conference in November and December.
Ahead of the Paris climate change talks, a new report argues that international trade deal contracts must be amended to ward off lawsuits that could potentially scuttle any agreements reached on climate change. Gus Van Harten, an associate professor at Toronto’s Osgoode Hall Law School, calls for a trade deal exemption clause in his new report, An ISDS Carve-out to Support Action on Climate Change. Any number of trade deals contain a mechanism known as an investor-state dispute settlement (ISDS). ISDSs allow foreign corporations to directly sue governments for financial compensation if new laws or practices are introduced that negatively impact corporations’ bottom lines. The Council of Canadians is championing Van Harten’s report, saying that if any climate deal reached at Paris is going to stick without vexing multi-million-dollar lawsuits, then trade agreements require the amendment. Many people aren’t looking at the background economic policies that might prevent a real agreement from ever coming to fruition, Maude Barlow, the national chairperson of the Council of Canadians, told National Observer. Barlow said if any climate change agreement reached in Paris isn’t fool-proof, it may not last once countries try to put it into practice. “If you don’t trade-proof it, you’re going to find when you get back home in your capitals, it’s going to take an awful lot of political will to stand up to the corporate anger you’re going to face and the corporate challenges.”
Huffington Post: Elon Musk Says Climate Change Refugees Will Dwarf Current Crisis
Elon Musk, co-founder of electric carmaker Tesla Motors, warned on Thursday that climate change will spark a refugee crisis of catastrophic proportions if no action is taken. In a speech in Berlin, the Tesla chief executive said Europe’s current wave of people seeking asylum, prompted mostly by political violence, will be dwarfed as fresh water becomes scarce, food supplies become insecure and weather changes in the coming decades. “Today’s refugee problem is perhaps a small indication of what the future will be like if we do not take action with respect to climate change,” Musk told an audience at Germany’s Federal Ministry for Economic Affairs and Energy. “Today, the challenge is in terms of millions of people, but in the future, based on what the scientific consensus is, the problem will be in the hundreds of millions and much more severe.” Volkswagen’s ongoing scandal over cheating on nitrogen oxide emissions tests on its diesel vehicles is troubling, Musk said, but it’s a small issue compared with the problem of overall carbon dioxide emissions.
Christian Science Monitor: Climate action comes thirteenth on the UN’s seventeen global goals list
At the United Nations General Assembly this week, leaders from around the world will meet to agree on a new list of goals that will combat hunger, eradicate poverty, and improve the quality of life for people around the globe. The list, called the 17 Sustainable Development Goals, expands upon the list of 8 Millennial Development Goals (MDG) that were put in place in 2000 and are set to expire this year. Here’s the list ….
Climate Change News: Court orders Pakistan to enforce climate law
Pakistan’s federal government must start implementing its climate change plans a judge at Lahore High Court said last week, ruling on a legal challenge brought by a farmer. Lambasting the inaction of national and provincial authorities, Judge Syed Mansoor Ali Shah said there had been “no progress on the ground” despite a National Climate Change Policy since 2012 and an implementation framework on the books. In his September 14 judgement Shah ordered the establishment of a national Climate Change Commission (with named members) with a clear remit to ensure effective implementation, along with a number of other practical institutional measures. The case against the Pakistani government had been brought to Lahore High Court’s Green Bench by an individual petitioner, Asghar Leghari. Using public interest litigation (PIL), Leghari who relies on agriculture for a living, charged the government and relevant authorities with failing him as a citizen. He accused them of failing to develop the required resilience to climate change as required under the government’s own framework for implementation of National Climate Change Policy 2013.
Prague Post: A mobile solar and wind power station
An alternative energy generating container developed by Czech companies makes its domestic debut at NATO Days and Czech Air Force Days in Ostrava, North Moravia. Three Alfons Mobile Energy Containers, equipped with collapsible solar panels, collapsible wind turbines, batteries and back-up diesel generators produce electricity for potential applications such as powering a field hospital. The container not only reduces reliance on fossil fuels, which have been blamed for climate change, but reduces the need to create a supply line to ship fuels long distances. Getting sufficient fuel to disaster areas or other remote sites has often been a stumbling block in starting emergency operations. The basic model has collapsible 5.2 kW or 9.2 kW solar energy system comprised of highly efficient PV modules, a 5 kW collapsible wind turbine, a battery with a maximum output of 80 kWh and a backup 11.2 kW diesel generator.
Gear Junkie: The Trinity portable power station
We covered Minnesota-based Skajaquoda a year ago when it launched a portable wind generator product that weighed 4 pounds and packed up small enough to take on a wilderness trip. The company is back with an improved unit, the Trinity Portable Wind Turbine Power Station. It looks like a mini windmill but folds up to pack small like the original design. Like a portable solar panel, the Trinity units harness the elements to create electricity anywhere. You plug in a device to recharge from the unit’s internal li-ion battery pack. Unlike solar, a turbine can be used at night or in low light. A USB port on one end gives compatibility to recharge phones, cameras, GPS units, and other products. The company notes the turbine is capable of generating up to 2.5 watts in as low as 4mph wind. The smallest unit weighs 1.4 lbs and starts at $369.
As of today, no major hurricanes, defined as Category 3 or above, have struck the continental U.S. in a record-breaking 119 months, according to hurricane data kept by the National Oceanic & Atmospheric Administration’s (NOAA) Hurricane Research Division (HRC) dating back to 1851. Last year, President Obama warned that hurricanes will become “more common and more devastating” because of climate change. But Obama is now the longest serving president (since the 1851 start of NOAA’s data) not to see a major hurricane strike the U.S. during his time in office. The last major hurricane to make landfall on the U.S. mainland was Hurricane Wilma, which came ashore on October 24, 2005. That year was one of the most active hurricane seasons in recorded history, according to NOAA. Hurricanes Katrina, Rita and Wilma all wreaked havoc on the U.S. during an intense two-month period between August 29 and October 24 of 2005. However, during the nearly 10 years since Wilma struck the U.S., no major hurricanes have made landfall and none are expected by the end of the current hurricane season.
A paper published today in Journal of Atmospheric and Solar-Terrestrial Physics finds a “strong and stable correlation” between the millennial variations in sunspots and the temperature in Antarctica over the past 11,000 years. In stark contrast, the authors find no strong or stable correlation between temperature and CO2 over that same period. The authors correlated reconstructed CO2 levels, sunspots, and temperatures from ice-core data from Vostok Antarctica and find “that the variations of SSN [sunspot number] and T [temperature] have some common periodicities, such as the 208 year (yr), 521 yr, and ~1000 yr cycles. The correlations between SSN and T are strong for some intermittent periodicities. However, the wavelet analysis demonstrates that the relative phase relations between them usually do not hold stable except for the millennium-cycle component. The millennial variation of SSN leads that of T by 30–40 years, and the anti-phase relation between them keeps stable nearly over the whole 11,000 years of the past. As a contrast, the correlations between CO2 and T are neither strong nor stable.” Thus, the well known ~1000 year climate cycle responsible for the Holocene Climate Optimum 6000 to 4000 years ago, the Egyptian warm period ~4000 years ago, the Minoan warm period ~3000 years ago, the Roman warm period ~2000 years ago, the Medieval warm period ~1000 years ago, and the current warm period at present all roughly fall in this same 1000 year sequence of increased solar activity associated with warm periods.
The tongues of two Rocky Mountains species of bumblebees are about one-quarter shorter than they were 40 years ago, evolving that way because climate change altered the buffet of wildflowers they normally feed from, according to a study published Thursday in the journal Science. In one of these species, the tongue had been half the size of the bee’s body — the equivalent of a human tongue going down to the waist. But because the flowers where the long tongue is required have dwindled, the bees didn’t need that much tongue. Keeping long tongues requires bees use more energy, so the bees evolved a shorter tongue that allows them to sample a wider variety of flowers, said study lead author Nicole Miller-Struttmann at the State University of New York, Old Westbury. While biologists have tracked how global warming has altered the developmental, migration, timing and other behavior in plants and animals, what makes this study unusual is the physical changes in the bees, said study co-author Candace Galen at the University of Missouri. “It speaks to the magnitude of the change of the climate that it’s affecting the evolution of the organisms,” Galen said. “It’s a beautiful demonstration of adaptive evolution.”