Tuesday, April 11, 2017

The flawed thinking at the heart of the renewable energy swindle

Bjorn Lomborg

A new report revealing that using wood pellets to generate electricity can actually speed up global warming should be the final nail in the coffin for the flawed policy of biomass subsidies. Policies designed to incentivise green energy use are not only having a dubious effect on climate change, they are destroying biodiversity and even killing many thousands of people.

Wood (or to use the technical term covering wood, wood pellets and other burning matter like animal dung, biomass) is by far the most significant renewable energy source. In both the US and the EU, biomass is the single largest source of renewable energy. Owing to poverty, around three billion people globally cook and heat their homes with wood, twigs and dung. More than four million die prematurely each year because of the resulting indoor air pollution.

And yet, in rich nations we have the bizarre notion that burning biomass is ‘green’ and eco-friendly. Governments, including in Britain, have deliberately promoted greater biomass dependence. The Drax power station in North Yorkshire generates seven per cent of the U.K’s electricity, predominantly burning biomass, supported by government subsidies. Seventy per cent of the electricity produced – enough to power Leeds, Manchester, Sheffield and Liverpool – is made using compressed wood pellets felled in the US and imported by ship.

But a new report from Chatham House suggests that this policy is very problematic when it comes to its goal of cutting CO2. It finds that the government’s view of biomass as a carbon neutral energy source is a ‘flawed assumption’ that is based on ignoring the emissions from the burning of wood. The problem is that the European Union policy holds the fictitious position that biomass produces no CO2 whatsoever. ‘Emissions from the fuel in use shall be taken to be zero’, says a 2009 directive. New Scientist rightly calls this assumption a ‘scam’.

The assumption underpins the EU’s 2020 renewables goal and its €8 billion (£6.84bn) annual spend on biomass – which has led to reports of protected forests being cut down in places like Italy and Slovakia. The EU now gets 65 per cent of its renewable energy from biomass. The effects on biodiversity of this practice are also troubling. Environmentalists point out that some manufacturers harvest whole trees — including hardwoods from bottomland areas — that can take a long time to regrow. A European Commission report found that the policy risks from transatlantic wood energy trade include ‘biodiversity loss, deforestation and forest degradation’ in the U.S.

The increase in biomass goes far beyond power stations, and reaches into our own homes. Policy-makers are using subsidies and tax policies to make fossil fuel-based energy more expensive and wood and pellets cheaper. Northeastern US states have seen 50 per cent to 150 per cent increases in wood as the main heating source since 2005. The UK is using financial incentives to ensure 700,000 homes convert to biomass heating, and biomass boilers are increasingly being installed to meet renewable energy requirements.

As we have seen on a vast scale in the developing world, burning biomass is far from benign. Even in the rich world, burning wood – encouraged by rising energy costs from green policies – is becoming a leading cause of death. In Prague, 27 per cent of the dangerous air pollution in winter today comes from wood smoke; in southern Germany it can reach 59 per cent. In London, it constitutes more than ten per cent.

Outdoor air pollution is the biggest environmental challenge in the rich world. Smoke from wood fires now constitutes 10-30 per cent of the total outdoor air pollution in Europe, meaning it conservatively claims 40,000 lives each year, and possibly many more. These are deaths from renewable energy. To put this into perspective, 26,000 people die each year in traffic accidents in the EU.

It will get worse. It is estimated that in Europe, small-scale domestic wood and biomass combustion will become the dominant source of the most dangerous particulate air pollution by 2020. In other words, it will be a bigger source of killer pollution than cars or industry and much bigger than power generation. During the Paris climate summit, former Californian Governor Arnold Schwarzenegger claimed that fossil fuels cause 19,000 deaths each day. He was far off. Around 3,900 deaths every 24 hours can be attributed to fossil fuels, whereas 11,000 deaths daily are caused by our reliance on biomass.

The problem comes from a governmental desire to transition to renewables before they are ready. We use biomass to cover for inefficient solar and wind, which need backup power when it isn’t windy or sunny. We will only solve global warming when solar and wind can compete with fossil fuels on their own merits. To achieve that, huge investment in green energy R&D, including batteries, is needed.

But in the meantime, biomass is a terrible short-term answer to global warming. In incentivising its use, policy-makers are having a dubious effect on climate change, likely destroying biodiversity, and killing tens of thousands from air pollution.


Energy policy will be about cutting costs, not emissions, says British government chief

The Government’s energy policy will focus on cutting costs to business as a Whitehall official admits it has ‘neglected industry for too long’. Peter McCusker reports.

UK energy policy has been view through the prism of the ‘trilemma’ since Ed Miliband’s 2008 Climate Change Act, but that is changing under Theresa May’s Government.

Nigel Pargiter, acting head of energy supply chains at BEIS (Department of Business, Energy and Industrial Strategy), told a North East audience that the emphasis is now on cutting energy costs to homes and businesses.  In a question and answer session at the annual NOF Energy Conference at the Sage Gateshead, he conceded the Government had ‘neglected industry for a few decades’.

Responding to a question from John Bruijnooge, site director at Teesside industrial giant Sabic, he said Whitehall ‘has had to take a long hard look in the mirror’.

“We have neglected industry for too long and we now have to have a keen focus on costs.”

He went to say the previous energy policies, which focused on balancing a trilemma of reducing energy emissions, cutting costs and delivering energy security, ‘had been the result of tensions’ between two Government departments.

He said: “Under the Coalition, energy policy was split between two different departments, the Department for Business and DECC (Department of Energy and Climate Change), and there were tensions.

“We got stuck on the trilemma. This became a sticking point, there was not one department to think holistically and this resulted in tension.

“Our view now is that decarbonisation has a cost to domestic users and businesses and our focus now is on ‘how much can industry bear before it is too much, and decides to go elsewhere?’”

In his earlier address to the conference he said: “The key challenge for us all is how do we get costs down and away from the subsidy regime. This is the biggest challenge we face and one that can be tackled by Government and industry working together.”

The North East has experienced the pain caused by measures to cut emissions with the introduction of the Carbon Price Floor in 2012 increasing costs at the Alcan aluminium plant by £30m, leading to its subsequent closure with the loss of over 500 jobs.

Mr Pargiter’s address echoed the Government’s Industrial Strategy Green Paper which talks about 10 key pillars for the UK economy; one of which is affordable energy and clean growth.

In this document the Government says it will continue to pursue a clean energy vision and is expected to confirm its latest Emissions Reductions Plan within the next few months.

Mr Pargiter said the Industrial Strategy will see Government ‘working with the devolved administrations and across all departments of Government’.

“The Industrial strategy is for the whole of the UK not just for London or specific sectors.

“We are trying to create networks and the right framework for business to grow and thrive, to deliver an economy that works for everyone, whilst also increasing productivity.”

He said the UK is good at research and development but often not so good at commercialisation of this knowledge. He said there will be an emphasis on deregulation and supporting exporters.

He went on to say there will be money available in a sector deal for energy and this will be focused on three things; energy costs, secondly to cut subsidies to zero and the third focus will be on innovation.

In working with business he said the Government ‘will favour an open door approach’ and businesses should ‘come forward and tell us what are the issues they face, that are hampering growth’.

“We want them to demonstrate a compelling case as to why they should benefit, one where it would be stupid for the Government not to get involved.”

Under the Coalition the industrial strategy for offshore wind said the Government would aim for a UK capital expenditure of 70%.

The average has been less than 30% and Mr Pargiter would not be drawn on the Government’s ambitions, although BEIS has previously told Journal Energy it is aiming for 50% lifetime UK content.

This a thorny issue for many who work in the sector, and has been cited as one of the reasons Newcastle offshore fabricators OGN went out of business, cancelling a £50m North East investment after losing out to Spanish-Government backed competitors for UK bill-payer subsidised contracts.

Mr Pargiter said: “We want to make sure UK companies are best placed and can operate on a level playing field.

“We are aiming up to open up the supply chain and more work needs to be done, there will be no percentage, but we are aiming to secure higher value contracts, not just ones for sandwiches and buses.”

This emphasis on cutting energy costs comes as further evidence of the UK direction of travel on energy has emerged in the last few weeks.

In the Budget Chancellor Philip Hammond said he will do all he can to prolong the life of the North Sea oil and gas industry.

Mr Hammond said he would look to resolve the tax issues slowing down asset transfers, with the current tax treatment of decommissioning making it harder for existing owners to sell mature assets.

Proposals could include making it easier to allow the transfer of tax history between buyer and seller.

Solar supporters who hoped the Budget would cancel a projected tax on companies with rooftop solar panels were left disappointed, and this fits in with the decision to end subsidies for what are deemed to be ‘established’ renewable technologies.

Last week the Government announced further support of what it calls ‘non-established’ renewable technologies such as geo-thermal and wave and tide, as well as offshore wind and biomass in its new Contract for Difference subsidy auction next month.


No Such Thing as a Conservative Carbon-Dioxide Tax Plan

Carbon-Dioxide Tax Would Make Everything More Expensive For Working Americans Without Guaranteed Environmental Benefits

A group calling itself the Climate Leadership Council (CLC) has issued a report that makes the case for a “sensible” carbon-dioxide tax, which it says would start at $40 per ton. Also included is a scheme to distribute revenues from this tax to American families via a dividend, border carbon adjustments on imports and exports, and a significant rollback of existing regulations of greenhouse-gas emissions.

CLC says the “evidence climate change is growing too strong to ignore,” and the “risks associated with future warming are too big and should be hedged.” According to CLC, a carbon tax would provide an ideal “insurance policy.” CLC says the tax would efficiently reduce carbon dioxide, encourage technological innovation, and shrink the size of government. Additionally, the “bottom 70% of Americans would come out ahead under such a program.”

Despite these grand claims, carbon-dioxide taxes are inherently regressive and disproportionally harm low-income families. The Congressional Budget Office (CBO) found a $28-per-ton carbon tax, much smaller than CLC’s $40-per-ton tax, would result in energy costs being 250 percent higher for the poorest one-fifth of households than the richest one-fifth of households. CBO reports the reason for cost discrepancy is “a carbon tax would increase the prices of fossil fuels in direct proportion to their carbon content. Higher fuel prices, in turn, would raise production costs and ultimately drive up prices for goods and services throughout the economy … Low-income households spend a larger share of their income on goods and services whose prices would increase the most, such as electricity and transportation.”

As my colleague H. Sterling Burnett has noted, CLC’s $40-per-ton tax would be even more burdensome than the Obama administration’s calculation for the estimated social cost of carbon dioxide, which it determined to be $36 per ton. “In other words, these old guard Republicans want to impose a tax on carbon that cost more than the costs carbon dioxide are supposed to impose on society,” Burnett said.

“Virtually all of the CLC assertions in support of its proposal are incorrect or implausible,” wrote the American Enterprise Institute’s Benjamin Zycher, who also said the study is “poor conceptually and deeply unserious.”

“The CLC provides no evidence that climate risks are ‘too big’ and assumes that the proposed tax would provide ‘insurance’ without examining the future climate effects of its proposal,” Zycher wrote. “The argument that an emissions tax is a more efficient method of reducing emissions relative to regulations is not correct. The dividend proposal is naive in that it ignores the coalition problem in Congress and the relative influence of concentrated and unconcentrated pressure groups. The border tax adjustment would be hugely complex given the international supply-chain system, leading to an increase in the attendant bureaucracy even if the regulatory bureaucracy is reduced in size. … Contrary to its assertions, the CLC proposal would increase the government allocation of resources and thus the size of government.”

Another problem with a carbon-dioxide tax is any environmental benefits that it might produce would be effectively meaningless without concomitant legislation enacted throughout the rest of the globe.

Oren Cass, senior fellow at the Manhattan Institute, says the environmental benefits that might come from passage of a carbon-dioxide tax would be minimal. “The effectiveness of a carbon tax as a matter of environmental policy [depends] not only on how it would directly alter the trajectory of [local] emissions but also on its ability to affect global emissions by driving globally applicable technological innovation or by influencing the behavior of foreign governments,” wrote Cass. “On each of these dimensions, the carbon tax fails.”

It is likely for these reasons the U.S. public finds the idea of a carbon tax so unpopular. A September 2016 poll conducted by the Energy Policy Institute at the University of Chicago and by the Associated Press-NORC Center for Public Affairs Research revealed 71 percent of respondents said they were unwilling to pay an extra $20 month on their electric bills to combat climate change, although this amount is “roughly equivalent to what the federal government estimates the damages from climate change would be on each household.” Further, almost half the respondents, 42 percent, said they would be unwilling to pay even one extra dollar.

A carbon-dioxide tax would make everything more expensive for working Americans, leaving them less to spend and save without any guaranteed environmental benefits. Lawmakers would be doing their constituents a favor by not pursuing such destructive proposals.


The irrelevance to Africa of global warming talk

"People aren't interested in rainfall projections for the next 100 years - they want to understand what's happening to them now”

More than 20 million people are at risk of dying from starvation within six months, the U.N. World Food Programme warned several weeks ago. Persistent armed conflict and prolonged droughts have crippled the economies of Somalia, South Sudan, Yemen and northern Nigeria, where communities are suffering the worst hunger.

That means we need to change the way we look at climate risk, Maarten van Aalst, director of the Red Cross Red Crescent Climate Centre, told a meeting in Nairobi this week.

Experts at the gathering called for the U.N.’s climate science panel to change the way it works, and examine how climate risk plays out locally and interlinks with other factors like the economy and health

“Rising levels of food insecurity are not just due to a lack of rainfall, but also because people are vulnerable to conflict,” van Aalst told the Thomson Reuters Foundation by phone from Kenya. “Climate is only one piece of a much bigger puzzle.”

He urged scientists and policy makers to focus on what matters to people in highly vulnerable places. “They aren’t interested in rainfall projections for the next 100 years - they want to understand what is happening to them now,” he told the event convened by the Climate Centre and the Intergovernmental Panel on Climate Change (IPCC).

Debra Roberts, chief resilience officer for the South African city of Durban and co-chair of an IPCC working group on climate adaptation and vulnerability, sees a growing gap between local climate action and the scientific work of the U.N. panel.

“Most of the time, our assessment just doesn’t find its way down to the communities who need it most,” she said.

Van Aalst said knowledge needs to be organised “in a way that is helpful to people and allows them to make better decisions”.

Roberts called for a “value chain of actors to take these messages down so they can be refined and interpreted in the local context”. “Think of the IPCC as a stone we throw into a pond: What other organisations form the ripples?”

International NGOs, for example, can play a role as intermediaries between governments and the population, she added.

But the exchange of information must be two-way, she emphasised, with knowledge also being passed upwards by those working on the ground.

Ultimately it is local people who must manage climate risks - and they can help fill gaps in understanding as well as map out solutions, said van Aalst.

The Paris climate change agreement acknowledges its vision to curb global warming cannot not be achieved by national governments alone, he noted, but requires a “climate action agenda”, bringing in local governments, NGOs, businesses and individuals.

Roberts underlined the need for a better understanding of local contexts, both in rural areas and cities.

In Durban, for example, the poorest and most vulnerable residents live far from jobs and services, and are particularly exposed to environmental degradation such as worsening coastal erosion and water shortages.

“That is something policymakers cannot ignore when designing urban policies and trying to tackle climate risk,” she said.

Cities – which are responsible for an estimated three-quarters of planet-warming emissions, according to the U.N. Environment Programme – are key to bridging the gap between local climate risk and global policy decisions, she said.

But making that happen will take time, she added, not least because local communities tend to see themselves as recipients of expert knowledge rather than as “generators of knowledge themselves”.


Time for Australians to invest in emergency power, as coal-fired power stations shut down with no replacements

Robert Gottliebsen

All businesses and households in Victoria, NSW and South Australia need to seriously consider investing substantial sums in diesel generators, batteries or other sources of emergency power. Banks need to be ready to fund the massive investment required during the next nine months.

It is now absolutely clear that each of the state governments have not invested in sufficient emergency power to back their wind and solar installations and now have a network of wires that is unsuitable for the power generation grid they have established.

And the Commonwealth promises a partial solution in two or three years via the Snowy but has washed its hands of the looming disaster next summer.

That means that businesses and residents who need power in hot summer days are on their own. Prepare for massive food rotting and equipment (including computer) disruption for those who did not recognise the extent of the destruction of power security by three state governments.

Last week I wrote a three-part series stating that NSW, Victoria and possibly South Australia face a 75 per cent chance of blackouts because their once great networked power systems had been vandalised by politicians who made the easy decisions of plonking solar and wind generators in their state but not the hard and expensive but essential decisions of investing in the grid and providing back up. It was rank irresponsibility, although decisions were made complex by the different owners of the various parts of the network and the need to earn a return on investment.

Following my series, The Australian Energy Market Operator took the unprecedented step of announcing that Victoria faced an incredible 72 days of blackouts and power shortages if Hazelwood was shut this week (April 1).

Businesses in Victoria from restaurants to supermarkets and offices/factories that do not respond to the combination of my warning and that of the Australian Energy Market operator have only themselves to blame. Meanwhile, Victorian Premier Daniel Andrews walks around with his proverbial fingers crossed hoping Victoria will have another cool summer.

But NSW is not much better. It went very close to blackouts last summer but was saved by Victoria’s Hazelwood power station, which is set to close on April 1. Assuming Hazelwood is shut should it be Sydney or Melbourne that gets hit by the likely combined power shortages? Last summer when Sydney ran short of power Bendigo was scheduled to be blacked out to cover the NSW government’s failure to ensure adequate power for a hot summer. Bendigo residents were outraged that they should pay the price for NSW mistakes but they were lucky and kept their power.

NSW made its own Hazelwood mistake three years ago by allowing the Wallerawang power station to shut (it was about two thirds the size of Hazelwood) without ensuring the necessary investments were made to ensure supply during a hot summer. The owner of Wallerawang found that for long periods during the year the station was not required so made a commercial decision.

So if it’s a hot summer in 2017-18 who should be blacked out – Sydney or Melbourne? It will actually be determined by how the grid is operating but let me hypothetically intervene. I think it fair that NSW suffer one third and Victoria two thirds of the blackouts given that the Hazelwood closure is bigger than Wallerawang

The NSW and Victorian governments are also presiding over the fastest growing populations in the country, which is multiplying the effect of their vandalism.

South Australia made similar gambles and was caught with blackouts last summer (partly storm related) but now says it will go alone to secure its power. Businesses in South Australia have to decide whether to punt their government’s assurances or do what the businesses in NSW and Victoria must do and invest in back-up generation and/or batteries.

As I emphasised in last week’s series that it’s not a question of carbon or non-carbon energy. If governments want to go non-carbon then they must do the job properly and change the grid and have back up.

Both the NSW and Victorian governments need to get hold of the world’s best engineers to see what can be done to repair their vandalism. As I understand it there are alternatives even at this late stage. Meanwhile when the lights, computers and refrigerators go down at Point Piper, Cronulla and Kooyong I suspect the Commonwealth members for those areas (Turnbull, Morrison and Frydenberg) will get a big chunk of the blame for not declaring a state of emergency and keeping Hazelwood open by giving the French owner of the station some relief on the $1 billion rehabilitation that is required.

Turnbull needs to warn power users that prices must rise much further to cover the state government mistakes. Instead, he talks about lower prices.



For more postings from me, see  DISSECTING LEFTISM, TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC and AUSTRALIAN POLITICS. Home Pages are   here or   main.html or   here.  Email me (John Ray) here.  

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