Friday, July 15, 2011

Don't laugh! Germany to fund new coal plants with climate change cash

The German government wants to encourage the construction of new coal and gas power plants with millions of euros from a fund for promoting clean energy and combating climate change.

The plan has come under stiff criticism, but the Ministry of Economics and Technology defended the idea. A spokeswoman said it was necessary as the government switches from nuclear to other renewable energy sources and added that the money would promote the most efficient plants possible.

Funding for the initiative is limited to five percent of the energy and climate change fund’s annual expenditure between 2013 and 2016.

Annual funding for the new plants could total more than €160 million per year between 2013 and 2014 alone, the Berliner Zeitung newspaper reported on Wednesday.

The fund was first established to encourage nuclear plant operators to develop new, renewable forms of energy production. Now that nuclear power is to be phased out by 2022, the fund will pay for research into reducing carbon dioxide emissions from buildings, developing renewable energy sources and storage technologies for them.

Opposition politicians and environmental groups said the plan was wrong because it would promote what they argued were climate-damaging plants. They also worried that money earmarked for other valuable projects could be reduced as a result.

Oliver Krischer, a member in the Bundestag of the Green party, told the Berliner Zeitung that the country would do better to encourage more investment in energy efficiency

And the environmental pressure group Friends of the Earth Germany (BUND) said additional coal-fired plants were entirely unnecessary.

The Economics Ministry spokeswoman said that in any event, that Germany’s goal to reduce greenhouse gas emissions by 40 percent by 2020, would not be damaged by the new initiative.


Global oil supplies are healthier than they seem

Many of the world’s oil consuming nations, led by the US, shocked oil markets this week as the International Energy Agency agreed to release 60m barrels of oil from strategic reserves over the coming month. The move was intended to offset price pressures brought about by Libya’s supply cut and comes in response to Opec’s recent inability to formally endorse new supply increases. The IEA action is also an example of growing concern over higher oil prices in Washington, where the White House is managing political fallout from high gasoline prices as next year’s presidential elections loom just over the horizon.

Yet, a year from now, we’re likely to look back on this moment and find that fears for supply have diminished. There are three reasons.

First, the most substantial fallout from the Arab world’s recent upheaval is behind us. Syria’s Bashar al-Assad continues to fight for survival and Yemen continues to flirt with failed-state status, but the Gulf’s major oil-producing states are quite stable. So are other major producers. Even in Iran, with its leaders infighting, the green revolution has moved off the streets for now. While there are plenty of long-term structural challenges for many major economies – just ask China – for the moment there are no more Libyas left to explode. IEA action and the ongoing Saudi supply increases will neutralise what remains of the oil price’s political risk premium.

Second, big additional supply is coming, and it’s not all priced in. Offshore Brazil and Canadian oil sands are no longer new stories, but their collective impact has not yet been fully felt and is often undervalued. Iraq still draws undue scepticism but production there is showing serious promise. The country could add up to 300,000 barrels this year, with more contracts, more exploration and more drilling already in the works. Barring an unlikely and total implosion of the government, it is hard to see production slowing down this decade. The same is true for “tight oil” coming from unconventional sources. We are seeing this begin to play out in North American fields such as the Bakken in North Dakota. As technology and investment are dispersed over the coming year, oil supply should positively surprise.

Third, Saudi supply increases are not dependant on Opec. The country’s oil minister Ali Naimi left the cartel’s Vienna meeting earlier this month with complaints that the organisation had just endured one of its most contentious and least productive gatherings in many years. But that is only because the major oil players were not prepared to pretend that there was agreement on output quotas. With Iran chairing the meeting, an annoyed Venezuela in attendance and an embattled Libya looking on, it was much harder to get the group to put aside their differences and smile for the cameras. The Saudis have the most influence on price-moving output decisions and they increased production just as they had planned before the meeting proved so difficult. Economically stressed oil producers such as Iran and Venezuela always want higher oil prices. But the Saudis and other Gulf Co-operation Council producers maintain a longer-term moderating outlook and they are the ones with the spare capacity to make the difference.

Add that to your favourite economist’s projection on the softness of the global economy, and we may soon be asking whether or not this latest IEA move was worth it.


Greenies don't like hydroelectricity either

Climate change must receive serious consideration as officials contemplate whether to relicense hydroelectric projects throughout California, advises a watershed scientist at UC Davis.

"Given the rapidity of climate warming, and its anticipated impacts to natural and human communities, future long-term (typically 30-50 years) fixed licenses of hydropower operation will be ill prepared to adapt if possible hydrologic changes are not considered," wrote Joshua Viers, associate director of UC Davis' Center for Watershed Sciences, in a recent issue of the Journal of the American Water Resources Association. (The paper is available online here

Viers warns that shifts in precipitation, combined with an increase in energy demands as temperatures rise, could dramatically impact hydropower production.

According to the California Energy Commission, hydropower — predominantly fueled by Sierra Nevada snowmelt — provides approximately 11 percent of California's in-state energy production.

But while hydropower is considered a source of cleaner energy — one that could help reduce climate-altering greenhouse gas emissions — it is vulnerable to climate warming.

For example, if annual temperatures rise 4 degrees Celsius (about 7 degrees Fahrenheit), summer seasonal hydropower production is projected to decrease by up to 30 percent for hydropower facilities in the American, Bear and Yuba watershed, according to a study led by the Stockholm Environment Institute and co-authored by UC Davis scientists. (The paper is available online here

This vulnerability was not taken into account when the Federal Energy Regulatory Commission recently approved study plans for relicensing of the Yuba-Bear Drum-Spaulding hydroelectric facilities in Northern California.

Failing to consider climate change research is "poorly reasoned and risky," says Viers.

The western Sierra Nevada currently has 54 hydropower projects licensed by the commission. These projects include dams, powerhouses and 826 kilometers of water conveyances such as ditches, canals and tunnels. More than 1,800 kilometers of rivers run downstream from these projects, representing 53 percent of all regulated rivers in the western Sierra Nevada.

This hydropower infrastructure not only represents a huge economic investment, but also highlights the need to consider adaptive solutions to water and ecosystem management, hydropower generation and climate warming as snowmelt flowing through hydroelectric plants diminishes.

"If the Federal Energy Regulatory Commission is to establish conditions of operation for 30-50 years," Viers says, "licensees should be required to anticipate changing climatic and hydrologic conditions for a similar period of time."

Funding for this study was provided by California Energy Commission.


Doom postponed again

It’s like they expect us to have forgotten their last dud scare:
SEA ice in the Arctic is melting at a record pace this year, suggesting warming at the north pole is speeding up and a largely ice-free Arctic can be expected in summer months within 30 years.

The area of the Arctic ocean at least 15 per cent covered in ice is this week about 8.5 million square kilometres - lower than the previous record low set in 2007 - according to satellite monitoring by the US National Snow and Ice Data Centre (NSIDC) in Boulder, Colorado.

As well, data from the University of Washington Polar Science Centre shows that the thickness of Arctic ice this year is also the lowest on record. In the past 10 days, the Arctic ocean has been losing as much as 150,000 square kilometres of sea ice a day, NSIDC director Mark Serreze said....

‘’There will be ups and downs, but we are on track to see an ice-free summer by 2030. It is an overall downward spiral.’’

By 2030?
But this same Serreze in 2007 was warning of an ice melt by as early as .. 2013 - just two years from now:
Scientists in the US have presented one of the most dramatic forecasts yet for the disappearance of Arctic sea ice.

Their latest modelling studies indicate northern polar waters could be ice-free in summers within just 5-6 years.

Professor Wieslaw Maslowski told an American Geophysical Union meeting that previous projections had underestimated the processes now driving ice loss. ...

“Our projection of 2013 for the removal of ice in summer is not accounting for the last two minima, in 2005 and 2007,” the researcher from the Naval Postgraduate School, Monterey, California, explained to the BBC.

“So given that fact, you can argue that may be our projection of 2013 is already too conservative.” ...

Dr Mark Serreze ... added: “I think Wieslaw is probably a little aggressive in his projections, simply because the luck of the draw means natural variability can kick in to give you a few years in which the ice loss is a little less than you’ve had in previous years. But Wieslaw is a smart guy and it would not surprise me if his projections came out.”

So what happened to all those earlier predictions, of a total ice-melt by possibly 2012 - as aired on the ABC’s Four Corners? See here

The US National Snow and Ice Data Centre once even claimed the North Pole could be ice-free in 2008.

Al Gore believed it, and then had to readjust his own prediction to 2013, when the ice refused to do what the climate models predicted. But then, after yet another refusal of the Arctic to behave as predicted, he adjusted again, predicting the ice could vanish by 2014.

And now we must panic again?



Climate cops coming

HUNDREDS of "carbon cops" will police compliance with the carbon tax and will have the power to inspect premises, take companies to court and impose financial penalties.

Yet the 200 workers employed at the new $256 million Clean Energy Regulator might actually contribute to climate change, like the government's Department of Climate Change and Energy Efficiency.

The government arm responsible for the implementation of the carbon tax yesterday admitted it was not carbon neutral and it was too early to say if tax enforcement would add to the department's pollution output.

A spokesman for the Department of Climate Change said it used green power but its emissions were still 12.5 tonnes a year - about the same as a family home. The figure was an underestimate as it does not include staff plane travel and taxis.

Staff at the Clean Energy Regulator will allocate carbon permits to businesses for the $23 per tonne carbon charge and will also hand out the free permits to big polluting industries scheduled to receive assistance.

The spokesman said the regulator would be responsible for educating companies on administrative arrangements, assessing emissions data to determine liability and operating a registry of emissions.

"The Clean Energy Regulator will be a statutory authority with substantial powers to enforce the carbon pricing mechanism," the spokesman said. He said the regulator would have the power to initiate audits of emissions, inspect premises, impose penalties and initiate court proceedings.

The government's carbon tax documents, released on Sunday, showed companies would face an emissions charge if their "emissions obligations were not met through the surrender of eligible emissions units".

Emissions charges will be $29.90 a tonne next year and $31.40 and $33 in following years.

Carbon permits will be considered financial products and will have a unique identification number.


The real winners of Gillard's carbon price plan

BIG banks, accountants and lawyers are among the big winners to cash in on the carbon plan, as companies wrestle with reporting requirements arising from the tax.

Research by IBIS World shows the demand for accountants will surge by 3.4 per cent in the next year because of the Government’s clean action plan, The Australian reported.

The research shows that demand for accounting and business advisory services will boom over the next five years, as businesses try to adapt their practices to “mitigate the downside - or capitalise on the upside of the new legislation".

Financial services firms are also likely to profit from the overhaul of the tax system announced as part of the carbon plan.

Banks will be involved in trading carbon permits when emissions trading starts in 2015, and will develop new products to help polluters reduce their carbon exposure.

Australian Bankers' Association chief executive Steven Munchenberg said the Government's carbon price was "essentially creating a new market".

"We would therefore expect to see a range of instruments developed to help companies manage their carbon exposure," he said.

Lawyers will also benefit from the boom, with Ibis predicting demand for services to rise by 3.8 per cent.

Big law firms are set to be major winners if energy-intensive companies try to challenge the legislation.


Barking mad - a nation howling at fireflies

Australia's carbon tax

You don’t need to study any numbers to know it doesn’t add up. The statistical chicanery in a patchwork tax, with a complex compo plan, and offsets, subsidies, and a$10 billion renewable energy* Christmas wish list is as complex as a climate model. But this time no one is saying “it’s settled”, and is seriously expecting to get their extra 20 cents a week.

Lost among the bedazzling array of numbers are one pair of figures that put the central dumbness of this plan on display.

Australians will pay about $10 billion* a year in carbon fees, overachieving their European competitors who only paid $2.6 billion over, wait for it, six whole years. On a per capita basis the numbers are stark. While Europeans chip in 96 cents a year, Australian’s will be told to pay $500.

The bottom line — figure this — is that we as a nation have “decided” to voluntarily^ pay somewhere from 2 – 5 times as much for our energy, and there are no cheap “technologies” on the horizon unless someone somewhere discovers them (and they’ve been looking for decades). Julia Gillard tried to compare this to other major economic moves like floating the dollar. But those big moves had selling points known as “benefits”.

Let’s list all the advantages, both of them, from this masochistic macroeconomics move:

* It will reduce global man made human emissions for the next eight years from 64,000 mt to just 63,840 mt (roughly). (I can’t see people opting to pay much for that).

* It will rocket Australia to the top spot on the IPCC’s Miss-Popularity National Rankings.

Yes, we have earned the death-defying Kamikazee-Sovereign-Economy award for 2011. (Competition closed early. There’s no point waiting til Dec 31. ) This will come in handy for some ALP personnel wishing to move onto UN unelected positions after the next election, but otherwise be generally a source of mirth for non-Australians.

The Australian share market took the news of the economic suicide gracefully, losing only $7 billion dollars in the first day. (And that tallies up only the top 25 companies which are going to cop the big carbon-speeding-ticket.)

Julie Novak explains the rise of the Carbonocrats (also known as the Green Police).

Michael Stutchbury, Economics Editor, The Australian, thinks it will be a miracle if the package survives.

Labor’s support falls again in the polls. And while I’ve generously pro rata’d the total revenue estimate to be $10b, Wong guessed $18 b, Pyne guessed $21b and apparently, the number is really $25 billion. Who knew? Not the ALP finance minister eh?.

Don’t forget to keep reminding those Labor Marginal Seats of their new favourite piece of legislation. There are groups forming in Greenway and La Trobe, so let us know if you want to join them, or start a new group elsewhere.

Me, I just wish we were spending $25 billion on medical research instead. What would you rather have? A cure for cancer or second hand windmill made in China?


Buried under the snow the Warmists said wouldn't fall

March 2000:

According to Dr David Viner, a senior research scientist at the climatic research unit (CRU) of the University of East Anglia, within a few years winter snowfall will become “a very rare and exciting event”. “Children just aren’t going to know what snow is,” he said.

May, 2008:

Scientists say Australian skiers should prepare for shorter ski seasons because of global warming… CSIRO climate change expert Dr Penny Whetton says Australia’s mountain snow cover could be reduced by up to 54 per cent by 2020.

July 2011:

THE deepest snow in 21 years has been recorded by Snowy Hydro at Spencer’s Creek. The 158.9cm-deep snow promises plenty of powder this season. The last time there was snow this thick early in July was in 1990.


Rooftop panels penalise poor

THIS week I signed off on a cheque for several thousand dollars (yes, I'm trying to use up my old chequebook before being forced to a paperless bank account) and I felt just a little grubby as a result.

Yet, in answering the greatest moral challenge of our time, I'm supposed to feel a warm inner glow at the thought of helping global greenhouse gas emissions and my grandchildren, Grace, Paddy and Fred.

My cheque wasn't for some grubby purpose; it was the final payment for putting a mini, greenhouse-gas friendly electricity generator on my roof, a series of photovoltaic cells.

In Canberra -- as elsewhere in Australia -- households with PV cells producing solar energy for their own use and for feeding back into the electricity grid get reductions to their electricity bills and even cash dividends.

Some people have seen the opportunity to do much more than offset their own electricity bill and have vast shiny seas of cells on their suburban roofs in expectation of generous income in the years to come.

For myself, the outlay, while sizeable, was more modest than many and was directed towards ameliorating my electricity bills in the years ahead when I become a self-funded retiree.

So why should I feel grubby about such a transaction, such a global-friendly decision and something that is going to save me money?

Well, the truth of it is I wasn't acting to save the planet and it was arguably against the interests of my grandchildren, who have to have heating during Canberra's chill winters.

Like China "acting on climate change", the actions I have taken will contribute to cutting greenhouse gas emissions from coal or gas-fired power stations, but it's not the reason I'm doing it. I'm doing it to save myself money.

There is no doubt that my actions, like China's investment in renewable energy sources -- and yes, the solar panels on my roof were all made in China although the inverter box is German -- is directed at saving money.

My actions, and China's, will be listed in the positive column for fighting climate change and some may say the motivation doesn't matter.

Others will point out that taking self-serving action is not the same as taking steps that cost a lot of money and don't have a positive personal return or economic saving.

But, as with most people and most economies, there is a finite limit, and it's pretty low, as to how much you are willing to spend without getting a financial return or tangible dividend.

For years I had signed up to planet-saving measures that added only a few cents to a bill here or there, but the thought of forking over thousands of dollars in a big lump and not getting a return is daunting to say the least.

In reaction to this natural human response, governments across the world, starting in Europe where Germany is the home of roof-top power generation, have offered incentives to technological developers, manufacturers, installers and households to buy green-friendly technology. These incentives take the form of renewable energy credits and guaranteed returns on renewable energy.

Governments have gone further to legislate MRETs -- mandatory renewable energy targets -- of varying sizes to be reached by various target dates. They were introduced as a measure independent of an emissions trading scheme or carbon tax. Indeed, when Labor was still in opposition and advocating an ETS and the level of the renewable energy target was an issue in contest with the Howard government, then frontbencher Joel Fitzgibbon, who is still the member for the coal-rich seat of Hunter in NSW, made the point that the MRET should be scrapped when an ETS came into force.

The valid reason for this was that artificial or mandatory targets for renewable energy distort the carbon market and the ability of the national energy supply market to deliver an orderly and cost-effective system for power.

This point is of such concern to Australia's energy ministers that they have requested the Australian Energy Market Commission to conduct a review of the RET schemes to assess their influence on power supply and costs.

The AEMC agrees with the government's chief climate change adviser Ross Garnaut that the RET schemes need to be reassessed in light of a carbon price.

In a previously confidential response to Garnaut's recommendations on the electricity industry, the AEMC said: "Careful consideration should be given to the overall impact on energy customers of a carbon price and the other measures that directly or indirectly provide incentives to reduce carbon emissions such as RET.

"The review of these policies should consider whether the existing policies are still required following the introduction of a carbon price and the potential for unintended, but foreseeable, consequences for energy customers from continuing a range of different measures. The overall aim should be to find policy settings that achieve the government's policy objectives as efficiently as possible, including minimising costs to consumers."

The report also noted the RET would have an effect on electricity prices, carbon emissions and the security of the electricity supply. On the latter point there have been other warnings that South Australia's highly successful achievement of a target of 20 per cent renewable energy raises questions about the extent of the sustainable contribution of renewable sources and where those sources can be concentrated in the national grid.

This brings us back to the point of why I don't feel comfortable about making the perfectly acceptable, socially admired and financially advantageous decision to spend several thousand dollars now to save money when I am thrown back on my own resources, which governments have been telling me to anticipate for years.

Because the feed-in tariffs are guaranteed by governments and new governments, such as Liberal Barry O'Farrell's government in NSW, seem incapable of rescinding the deals, then the distortion in the market, recognised by those framing the climate change response and trying to ensure energy security, is permanent.

What's more, I can afford PV cells to offset my electricity bills but, through the years, the little old lady across the street, the university students renting flats around the corner and my grandchildren's parents, none of whom could afford the cells, will be paying higher prices to offset my offset. That's why I feel grubby doing something legitimate, legal, encouraged, green-friendly and financially helpful for me. It distorts the market and is inequitable.



For more postings from me, see DISSECTING LEFTISM, TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC, GUN WATCH, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL and EYE ON BRITAIN. My Home Pages are here or here or here. Email me (John Ray) here. For readers in China or for times when is playing up, there are mirrors of this site here and here


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