Wednesday, May 22, 2019

Greenpeace activists blockade BP headquarters

Just another attention-getting stunt in the usual Greenpeace mode.  BP may well ask: "Why us?".  Like many others, oil and gas is their business

Environment campaigners have shut down BP’s London headquarters in protest at its continued investment in oil and gas.

Greenpeace said that its volunteers arrived at the offices in St James’ Square at 3am and “encased themselves in specially designed, toughened containers weighing several tonnes each, blockading all the HQ’s main entrances and preventing staff from entering the building”.

It said that the protesters had enough food and water to keep the offices closed all week.

The campaign group said that it was demanding that BP “immediately ends all exploration for new oil and gas and switches to investing only in renewable energy”. It argues that companies such as BP have business models “in direct opposition to efforts to prevent catastrophic climate change”.


Buffett’s bet on oil and gas looks like a hint about the future

What’s Warren Buffett doing with a $US10 billion ($14.5bn) bet on the future of oil and gas, helping old-school Occidental Petroleum buy Anadarko, a US shale leader? For pundits promoting the all-green future, this looks like betting on horse farms circa 1919.

Meanwhile, broad market sentiment is decidedly bearish on hydrocarbons. The oil and gas share of the S&P 500 is at a 40-year low, and the first quarter of 2019 saw the Nasdaq Clean Edge Green Energy Index and “clean tech” exchange-traded funds outperform the S&P.

A week doesn’t pass without a mayor, governor or policymaker joining the headlong rush to pledge or demand a green energy future. Some 100 US cities have made such promises. Hydrocarbons may be the source of 80 per cent of America’s and the world’s energy, but to say they are currently out of favour is a dramatic understatement.

Yet it’s both reasonable and, for contrarian investors, potentially lucrative to ask: what happens if renewables fail to deliver?

The prevailing wisdom has wind and solar, paired with batteries, adding 250 per cent more energy to the world over the next two decades than American shale has added over the past 15 years. Is that realistic? The shale revolution has been the single biggest addition to the world energy supply in the past century. And even bullish green scenarios still see global demand for oil and gas rising, if more slowly.

If the favoured alternatives fall short of delivering what growing economies need, will markets tolerate energy starvation? Not likely. Nations everywhere will turn to hydrocarbons. And just how big could the call on oil and natural gas — and coal, for that matter — become if, say, only half as much green-tech energy gets produced as is now forecast? Keep in mind that a 50 per cent “haircut” would still mean unprecedented growth in green tech.

If the three hydrocarbons were each to supply one-third of such a posited green shortfall, global petroleum output would have to increase by an amount equal to doubling the production of the Permian shale field (Anadarko’s home). And the world supply of liquid natural gas would need to increase by an amount equal to twice Qatar’s current exports, plus coal would have to almost double what the top global exporter, Australia, now ships.

Green forecasters are likely out over their skis. All the predictions assume that emerging economies — the least wealthy nations — will account for nearly three-fourths of total new spending on renewables. That won’t happen unless the promised radical cost reductions occur.

For a bellwether reality check, note that none of the wealthy nations that are parties to the Paris Accord — or any of the poor ones, for that matter — have come close to meeting the green pledges called for. The International Energy Agency says: “Energy demand worldwide (in 2018) grew by … its fastest pace this decade … driven by a robust global economy … with fossil fuels meeting nearly 70 per cent of the growth for the second year running.”

The reason? Using wind, solar and batteries as the primary sources of a nation’s energy supply remains far too expensive. You don’t need science or economics to know that. Simply propose taking away subsidies or mandates, and you’ll unleash the full fury of the green lobby.

Meanwhile, there are already signs that the green vision is losing lustre. Sweden’s big shift to wind power has not only created alarm over inadequate electricity supplies; it’s depressing economic growth and may imperil that nation’s bid for the 2026 Winter Olympics. China, although adept at green virtue-signalling, has quietly restarted massive domestic coal-power construction and is building hundreds of coal plants for emerging economies around the world.

In the US, utilities, furiously but without fanfare, have been adding billions of dollars of massive oil- and natural-gas-burning diesel engines to the grid. Over the past two decades, three times as much grid-class reciprocating engine capacity has been added to the US grid as in the entire half-century before. It’s the only practical way to produce grid-scale electricity fast enough when the wind dies off. Sweden will doubtless be forced to do the same.

A common response to all of the above is to make more electric cars. But even the optimists’ 100-fold growth in electric vehicles wouldn’t displace more than 5 per cent of global oil demand in two decades. Tepid growth in fossil-fuel demand would be more than offset by growing economies’ appetites for air travel and manufactured goods. Goodness knows what would happen if Trump-like economic growth were to take hold in the rest of the developed world. As Mr Buffett knows, the IEA foresees the US supplying nearly three-fourths of the world’s net new demand for oil and gas.

Green advocates can hope to persuade governments — and thus taxpayers — to deploy a huge tax on hydrocarbons to ensure more green construction.

But there’s no chance that wealthy nations will agree to subsidise expensive green tech for the rest of the world. And we know where the Oracle of Omaha has placed a bet.


Evolution of climate fear

In the lead-up to the latest report warning of a cataclysmic future for the natural world there was a frenzy behind the scenes to make sure it got the world’s attention.

Environment groups were briefed to spread the message that a UN report would be a supercharged affair when it was released this month.

The headline figure would be that one million species faced extinction. Biodiversity on planet Earth was on the road to ruin.

“Protecting biodiversity means protecting mankind because we human beings depend fundamentally on the diversity of the living,” UNESCO director-general Audrey Azoulay said in announcing the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services report in Paris earlier this month.

For many the report had echoes of the dramatic projections made almost a half-century ago when Paul Ehrlich predicted a “great die-off” in which billions would perish.

In 1970, S. Dillon Ripley, the secretary of the Smithsonian Institution in Washington, DC, and an ornithologist and wildlife conservationist, had assessed that before the turn of the 21st century between 75 per cent and 80 per cent of all the species of living animals would be extinct.

There have been questions about exactly how the latest million species extinction figure was arrived at, particularly given that it includes species that will probably never be identified or recorded.

The full global assessment report is yet to be published but the extinction rate appears to have been generated by extrapolating existing threatened species lists into the unknown.

New climate

The real import of the global assessment, however, is the attempt to set biodiversity on to an equal footing in the world politic with climate change.

The next step will be an important meeting scheduled for China next year at which the IPBES is planning to emerge as the Intergovernmental Panel on Climate Change equivalent for nature.

IPBES chairman Sir Robert Watson did not disappoint in setting the tenor of alarm. The overwhelming evidence of the global assessment presented an ominous picture, he said.

The health of ecosystems on which humans and all other species depended was deteriorating more rapidly than ever. Humans were eroding the foundations of their economies, livelihoods, food security, health and quality of life worldwide. But it was not too late.

“Through ‘transformative change’, nature can still be conserved, restored and used sustainably — this is also key to meeting most other global goals,” Watson said.

“By transformative change, we mean a fundamental, system-wide reorganisation across technological, economic and social factors, including paradigms, goals and values.”

The punchline mirrors exactly that of the IPCC’s report into the impact of 1.5C warming released late last year to encourage governments to increase their action on climate change.

That report concluded “rapid, far-reaching and unprecedented changes in all aspects of society were needed”.

The message is being eagerly embraced by a new generation of activists increasingly persuaded by a resurgent consequentialist notion that, on climate and nature, the ends can justify the means.

Doubtless the natural world has problems. But there is a long history of dire predictions that simply have not come to pass.


A mountain of money won’t change the climate


This British parliament declared the other day the planet was facing a “climate emergency”, making the UK the first country to do so after cities such as Los Angeles, London, Vancouver and Basel.

It’s a move that sums up all that is wrong with climate policy: politicians are making grandiose, fearmongering declarations that are divorced from economic ­reality, as well as from what will fix the problem they claim to be addressing. Political rhetoric is cheap but drastic cuts in carbon dioxide emissions remain prohibitively expensive and technologically challenging. After all, emissions cuts have been promised (and mostly not delivered) since the Earth Summit in Rio de Janeiro in 1992.

Cutting CO2 emissions to net zero by 2050 or much sooner is the ambitious goal being pushed by environmental protesters such as Extinction Rebellion and ­endorsed by politicians around the world, including several US presidential candidates. These protesters and politicians attract a lot of attention, but their pro­posals would incur far higher costs than almost any electorate is willing to pay.

Although opinion polls show that people care about climate change and want to spend a relatively modest amount to fix it, they want more spent on education, health, job opportunities and social support.

Most Americans are willing to pay up to $200 a year to fight climate change; in China, the amount is about $30. Britons are unwilling to cut their driving, flying and meat consumption significantly to combat climate change. And although the German government prioritises climate action so highly that it convened a “climate cabinet”, just one-third of Germans support a controversial proposed tax to ­reduce global warming.

The gulf between politicians and citizens is most apparent in France. The government vowed to cut CO2 emissions sharply by 2050 — but, embarrassingly, there have been almost no meaningful measures by President ­Emmanuel Macron. That’s ­because the “yellow vest” protest movement took to the streets to push back against the government’s fuel price surcharges, which disproportionately hit car-dependent people in rural areas.

France is not alone in neglecting its lofty promises. Recent analysis shows that of the 185 countries that have ratified the 2015 Paris Agreement, only 17 — including Algeria and Samoa — are meeting commitments.

Achieving net-zero emissions wouldn’t just cost a little more than people are willing to pay but an order of magnitude more.

The main economic models ­assessing the EU’s plan to ­reduce emissions by “merely” 80 per cent by 2050, for example, estimate average annual costs of at least $1.4 trillion. And Mexico’s relatively unambitious pledge to cut its emissions by half by 2050 will probably cost 7-15 per cent of GDP.

A report commissioned by New Zealand’s government to study its promise of carbon neutrality by 2050 found that the ­annual cost of meeting this target in 2050 and each subsequent year would be higher than the country’s entire annual budget. Moreover, this estimate assumes that policies are implemented as ­efficiently as possible.

In reality, no government manages to do that — so the cost of becoming carbon neutral could easily double. (The New Zealand government is steaming ahead with its policy regardless.)

The costs of deep emissions cuts are so high because we are all utterly reliant on fossil fuels. Green-energy alternatives, including solar and wind, are generally not ready to compete. As a result, policies forcing people and businesses to shift to immature technologies will slow growth and exacerbate energy poverty.

The world is much further ­behind in its “energy transition” than people realise. Solar and wind together deliver about 1 per cent of global energy, and the International Energy Agency ­estimates this will reach only 4.1 per cent by 2040.

Vaclav Smil, Bill Gates’s favourite energy ­expert, says that “claims of a rapid transition to a zero-carbon society are plain nonsense”, adding that “even a greatly accelerated shift towards renewables would not be able to relegate fossil fuels to minority contributors to the global energy supply … certainly not by 2050”.

Panicky political declarations and climate protests are driven by the widespread belief that the UN Intergovernmental Panel on Climate Change told us we have 12 years left to save the planet. This is at best a fundamental misunderstanding of what the IPCC said.

The panel was asked to establish which policies would be needed to achieve the almost ­impossible target of keeping temperature rises under 1.5C. The IPCC answered that this would indeed be almost impossible, ­requiring a total economic transformation in 12 years.

In fact, the IPCC’s last major report said that if we do nothing to stop climate change, the impact will be equivalent to a reduction in overall incomes of 0.2-2 per cent by the 2070s — similar to the ­effect of one economic recession.

Instead of pursuing costly and unrealistic emission-reduction targets, we should respond to climate change by getting the price of future green energy below that of fossil fuels so that everyone can afford to switch. A true transition requires investment in green-energy research and development.

Copenhagen Consensus previously assembled an expert panel of economists, including three Nobel laureates, to discuss solutions to climate change. The panel concluded that R&D spending on green energy should be dramatically increased, to 0.2 per cent of global GDP. This would be a less economically painful and much more effective way to solve the climate problem.

Declaring a climate emer­gency generates headlines and makes politicians and activists feel better. But empty rhetoric that ignores economic reality and common sense will not help the planet.


Donald Trump, Jr. with Mark Levin on Green New Deal: ‘It’s Insanity,’ ‘Outright Stupidity’

On his nationally syndicated radio talk show “The Mark Levin Show” on Thursday, host Mark Levin had on his program Donald Trump, Jr. who said that the Green New Deal is “insanity” and “outright stupidity.”

“It’s insanity,” Donald Trump, Jr. said about the Green New Deal proposal. “It’s literally, just outright stupidity. But what’s scary about it, Mark, is that the leading Democratic contenders for the presidency of the United States are all like, ‘Oh, this is wonderful. We have to get onboard.’”

Below is a transcript, in pertinent part, of Mark Levin’s interview with Donald Trump, Jr. from Thursday:

Mark Levin: “Let me ask you one more question. Bernie Sanders, AOC and these folks are pushing this socialist agenda, this Green New Deal. You think the American people are going to support this?”

Donald Trump, Jr.: “Well, listen. Hey, you know what? Like all things, Democrats are good at one thing. They’re good at marketing, okay? Not so good with fact, not so good with numbers, and the reality— I’ve rallied about the Green New Deal because it sounds so wonderful. You know, the only problem is, Mark, it cost $93 trillion, okay? The U.S. government takes in, revenue, six point – you know, six and change trillion dollars a year. So, let’s just round it up and say, in 15 years, if we did nothing other than eliminate farting cows and come up with some miracle transportation that somehow doesn’t use energy to get to Hawaii – because we’re eliminating all air travel – in 15 years we will have paid for the Green New Deal. Now, they say it will somehow pay for itself. But they won’t show any facts how that happens.

“So, it’s insanity. It’s literally, just outright stupidity. But what’s scary about it, Mark, is that the leading Democratic contenders for the presidency of the United States are all like, ‘Oh, this is wonderful. We have to get onboard.’ They don’t have the guts, the gumption, the willingness to even look into or fact check a freshman congresswoman, who, two months ago, didn’t know what the three branches of government are.”


Climate lies of the Australian Left sealed their Federal election loss

Soon after the election was called I lamented that it might be the dumbest campaign we have ever seen, primarily because of the inanity around climate change. I am sorry to say that prediction turned out to be more accurate than any climate modelling.

But the good news was that voters were smart enough to see through it. Labor and the Greens continually made absurd claims — actually let us call a spade a spade — they told the same lies every day. They said Australia was not taking climate action now; they said they could take action that would stop floods, droughts, bushfires and cyclones; they said these same actions would create jobs and prosperity; and they refused to even countenance putting a cost on them.

Now these same politicians and their army of virtue-signalling barrackers in the media now wonder why they lost the election. The idiocy is beyond comprehension — at least it is entertaining.

As they pack up their placards and wash down their cars after their anti-Adani convoy, the activists are quietly wondering whether they might have helped deliver a Coalition win. A grateful nation applauds them.

And while commentators continue to call for an end to the so-called climate wars they still don’t understand where that settlement will be found. They are right in deducing that only a bipartisan agreement can lead to solid, medium-term arrangements and investment certainty. But they keep looking for that agreement in the wrong place.

Amid the noise of the election fallout yesterday I had the pleasure of hearing a new voice who brought utter clarity to a policy area that has been unnecessarily complicated and divisive. I had long heard that James Stevens was someone to look out for and although I had met him once or twice, I had never had a serious conversation with him.

On Saturday the former chief of staff to South Australian Premier Steven Marshall was elected as the new Liberal member for Sturt, replacing his former boss Christopher Pyne. Stevens is clearly identified as a moderate Liberal but when I interviewed him on The Kenny Report yesterday I was struck by his no-nonsense approach on climate policy.

“I do support our policy position on meeting the Paris targets, I think we should do our fair share as a country but no more than that,” Stevens said. “And we certainly shouldn’t penalise Australian businesses and Australian families by having a disproportionate approach to reducing carbon emissions that just exports our jobs to other countries that aren’t putting the same unnecessary, overly ambitious targets in place.”

At this point I interrupted him to say this was the clearest exposition of this issue I had heard from his party for a long time. He continued.

“All it means is that businesses, particularly in the manufacturing sector, the jobs that are lost in our economy, if we take unnecessary policy positions that increase power prices in an uncompetitive way, those jobs are going to go to countries that are emitting an enormous amount more carbon than we’re emitting here in Australia at the moment. So I don’t understand why even the environmentalists think that we should put ourselves in that position because you’ve got the perverse situation where we are penalising our economy but we’re also penalising the planet. If you consider increasing greenhouse gas emissions to be something that puts the planet in peril, that’s going to be achieved by sending jobs from this country to other countries that are not doing anywhere near what we already are.”

There you have it. It is obvious; it is based on fact rather than emotion; it involves not a hint of climate denial or economic vandalism; just responsible, pragmatic and committed environmental and economic management.

Then this morning we heard some sense spoken by Labor frontbencher Joel Fitzgibbon about how Labor must find a way to support climate action as well as the mining sector and the jobs, families and communities it supports. As Fitzgibbon pointed out, this is no more than giving voice to official ALP policy.

We are starting to see how Scott Morrison’s electoral triumph has unleashed an outbreak of intellectual clarity and common sense. The idiocy of the campaign is behind us, the emotive nonsense of the partisans is silenced (for a while at least) and there might be a chance for progress.

The answer is obvious. It is — as it always has needed to be — a bipartisan settlement. But not around reckless or overly ambitious gestures that aim to lead the world.

The major party consensus has to be a simple commitment to the Paris targets. No more, no less. A position Labor has held in the past before it started chasing unicorns. Labor has come back to the global consensus. It is that easy. If the major parties agree on that, the mechanism to deliver it is a doddle.



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   here or   here.  Email me (John Ray) here.  

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