Tuesday, March 15, 2022
US and EU Shift Fuel Imports From Russia to China
The Ukraine war is driving sanctions on Russia that limit sources of oil and gas for U.S. and European markets. Buyers are now seeking alternate non-Russian sources, driving renewed interest in renewable energy such as wind and solar—both sectors in which Chinese companies are increasingly competitive.
Energy buyers are also seeking oil and gas from currently sanctioned countries like Iran and Venezuela, relieving pressure on them meant to improve their human rights, and giving them bargaining leverage on issues like their authoritarian forms of government and nuclear proliferation.
While Russian sanctions are ramping up, pressure on other illiberal countries is necessarily decreasing due to a lack of an even and sustainable approach to the application of sanctions. China and its de facto allies—Iran, North Korea, and Venezuela—are actually the bigger long-term threat, compared to Russia, and so shifting markets there could hurt democracy more in the long term.
This is not to argue that Russia should not be sanctioned—it should, and sanctions should increase. Rather, Russia sanctions should be designed so that other illiberal regimes are not the beneficiaries.
On March 8, the European Commission issued an energy plan that started, “Following the invasion of Ukraine by Russia, the case for a rapid clean energy transition has never been stronger and clearer.” The European Union imports over 46 percent of its coal, 40 percent of its gas, and 27 percent of its oil from Russia.
The EU statement said that while diversifying its supply of gas away from Russia, “the EU fosters its international partnerships,” including with the G-7 and other major global gas importers: Japan, South Korea, India, and China.
Luz Ding at Bloomberg noted on March 9 that “Europe’s wartime plan for a faster transition to clean energy as it seeks to replace Russian fossil fuels will provide a boost to the order books of China renewable manufacturers.”
By 2030, the European Union will add 900 gigawatts of solar and wind power, according to the new EU energy plan, almost double what analysts previously expected.
The key beneficiary will be China’s Longi Green Energy Technology Company, which is the world’s biggest solar company. Longi had its products seized by U.S. customs authorities in November due to their polysilicon sourced from Xinjiang, where Uyghurs are enslaved in factories and fields. Xinjiang currently supplies 45 percent of the world’s polysilicon.
Rather than shifting purchases of energy to China and its illiberal allies, Europe and the United States could patronize their own allies, including through the purchase of British solar panels, Norwegian natural gas, and Canadian oil, for example.
Norway’s gas already accounts for 23.6 percent of EU gas imports. Supporting countries friendly to democracy means buying more energy from countries like Norway.
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Four huge gas reserves identified in UK to avoid energy crisis
According to some estimates, Britain is expected to fork out £2billion for Russian imports of natural gas imports this year.
Official figures from the Department for Business, Energy & Industrial Strategy also suggest reliance on Russian gas has doubled in just four years.
But the UK may be able to avoid having to fork out that extra cash if it focuses on its domestic reserves.
As prices rise, Prime Minister Boris Johnson has been urged to address these domestic supplies, which critics say are being pushed aside over his climate policies.
Currently, the country’s production of natural gas from conventional reserves do not meet domestic demand (typically 70–80 billion cubic metres per year).
But after coming under fire, Mr Johnson said at a Downing Street press conference on Monday that Britain would take a look at using more domestic energy resources as part of an "energy supply strategy".
This could involve accessing four key areas with huge potential for shale gas extraction.
These include the Carboniferous Bowland–Hodder area in northwest England (Lancashire and the Midlands) and the Carboniferous Midland Valley in Scotland.
It also includes the Jurassic Weald Basin in south England, and the Wessex area in south England.
Recent analysis in 2019 suggested Bowland–Hodder holds around four trillion cubic metres (tcm) of gas.
But an obstacle stands in the way of accessing those supplies.
Shale gas is extracted through a process called fracking, but this was banned by the Government back in 2019 after scientists raised concerns about earthquakes and the threats it posed to local communities.
A review published in March 2020 by Warwick Business School said fracking could produce between 90 and 330 billion cubic metres (bcm) of natural gas between 2020 and 2050.
Now, the Government has been urged to lift the ban so Britain can access more of its domestic reserves and avoid the huge price increases for gas imports.
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Australia: Five years on, Snowy 2.0 emerges as a $10 billion white elephant
A very costly alternative to coal. The original Snowy scheme was a boondoggle too
Five years ago on Tuesday, then prime minister Malcolm Turnbull announced, with great fanfare, the Snowy 2.0 pumped hydro project: “The Turnbull Government will start work on an electricity game-changer ... This plan will increase the generation of the Snowy Hydro scheme by 50 per cent, adding 2000 megawatts of renewable energy to the National Electricity Market (NEM).”
Senate Estimates papers confirm the announcement was cobbled together in less than two weeks after the concept was floated by Snowy Hydro.
The nation-building vision was for a big battery to be added to the Snowy Mountains Hydro-Electric Scheme. It was to be completed in four years (that is, by last year) at a cost of $2 billion without any taxpayer subsidy, bring down electricity prices, generate renewable energy and incur minimal environmental impact on Kosciuszko National Park.
Inspiring stuff. But not one of these grand claims has turned out to be true. Worse, Australian taxpayers and NSW electricity consumers will be up for billions of dollars in subsidies and increased electricity costs, all while Kosciuszko is trashed. Let’s have a quick recap.
Snowy Hydro now expects completion in 10 years, not four, by 2026. Some experts consider even this extended timeframe to be optimistic. Construction of the tunnels is running at least six months behind the latest schedule and the transmission connection is unlikely to be built by 2026 anyway. The all-up cost has increased at least five-fold, to $10 billion-plus, as energy experts warned the Prime Minister and the then NSW premier in 2020.
The underground power station and tunnels alone will cost more than $6 billion, and Snowy Hydro avoids mentioning the transmission connections to Sydney – $4 billion-plus for HumeLink and the Sydney ring – and to Victoria. To make matters worse, Snowy Hydro refuses to contribute to these transmission works, leaving it to electricity consumers to pick up the tab. Transmission tariffs in NSW will increase by more than 50 per cent if the NSW government allows Snowy Hydro to get its way, based on analysis in a Victoria Energy Policy Centre report.
It’s been around for decades but pumped hydro power is gaining attention as a potential back up for renewable energy, which is increasing its share of the electricity grid. It’s also technology the federal government is interested in.
Despite the assurance that taxpayer subsidies were not required, the federal government was forced to shore up Snowy 2.0’s business case with a $1.4bn “equity injection”. Further taxpayer funding is inevitable, warned Standard & Poors when it downgraded Snowy Hydro’s credit rating in 2020.
Far from bringing electricity prices down, Snowy Hydro’s own modelling predicts that prices will rise because of Snowy 2.0.
As far as the claim that Snowy 2.0 will add 2000 megawatts of renewable energy to the National Electricity Market, Snowy 2.0 is not a conventional hydro station generating renewable energy. It is no different to any other battery, and as such it will be a net load on the NEM. For every 100 units of electricity purchased from the NEM to pump water uphill, only 75 units are returned when the water flows back down through the turbine generators. Not only is the electricity generated not renewable, Snowy 2.0 will be the most inefficient battery on the NEM, losing 25 per cent of energy cycled.
And on the final claim of minimal environmental impact to Kosciuszko National Park, vast areas have already been cleared, blasted, reshaped and compacted. Hundreds of kilometres of roads and tracks are being constructed, twenty million tonnes of excavated spoil will be dumped (astoundingly, mainly in Snowy Hydro’s reservoirs), and noxious fish will be transferred throughout the Snowy Mountains and the headwaters of the Murrumbidgee, Murray and Snowy Rivers, devastating native fish and trout. The NSW government has even agreed to issue exemptions to its own legislation to override the prohibition of such pest fish transfers – an astonishing precedent.
The massive cost and environmental impacts of Snowy 2.0 cannot be justified for providing occasional longer-term storage.
The latest revelation in this dismal saga is the proposal for four high-voltage transmission lines through eight kilometres of Kosciuszko National Park with a cleared easement swath up to 200 metres wide. The statutory plan of management that controls activities in Kosciuszko expressly prohibits the construction of new overhead transmission lines, as is the norm with national parks in Australia and throughout the developed world. Reprehensibly, the NSW government has released a draft amendment to exempt Snowy 2.0 from having to install underground cables.
Despite Snowy 2.0’s abysmal track record over the past five years, the Commonwealth and NSW governments continue to bend over backwards with billion-dollar subsidies (and more to come), electricity price increases and environmental exemptions, despite conclusive evidence that the project is fundamentally flawed and can never pay for itself.
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Ignore climate twerps, fossil fuels coal, gas and oil still rule
Don’t we have enough twerps in Australia that we have to import one like the former hapless and hopeless Bank of England governor turned climate-boondoggle main-chancer Mark Carney?
Carney, who is now vice-chairman of Canadian investment group Brookfield, was ‘in’ Australia – be thankful for small mercies, only virtually – to lecture Australians on two topics.
The first was our tardiness in embracing ‘going dark’ with so-called full-on renewable energy.
The second was to berate the board of AGL specifically for knocking back the opportunistic takeover bid Brookfield had launched for it in partnership with ‘Mr Harbourside Mansions Version 2.0’, got-lucky, once, tech billionaire Mike Cannon-Brookes.
Brookfield and Brookes wanted to buy AGL, abandon its proposed de-merger into two companies, and accelerate the closure of its coal-fired stations which are currently keeping Australian lights on, especially, when the wind don’t blow - and you know the rest. Last weekend the partners had upped their bid to $8.25 a share. It was promptly – and sensibly – rejected by the AGL board.
The central point that AGL holders should understand is that if the duo were prepared to pay $8.25, AGL shares are worth more, much more. Bidders don’t go around offering to spend $9bn just to play Father Christmas.
They want to make big bucks on their billions outlaid. The central point that the other 25m Australians should understand is that those ‘big bucks’ would be made by ripping more dollars out of their pockets, either directly as consumers or indirectly as taxpayers, while taking them into an increasingly – real, not virtual – dark future.
Indeed, with surprising – utterly unknowing? – ‘honesty’ Carney said as much out loud. “The scale of the net zero transition (read: destroying cheap, reliable power generation) is such that this is a target-rich environment (read: there are trillions of dollars to be made from hapless governments and suffering consumers),” he said.
You could not have asked for more exquisite timing for Carney’s comments, as the events in and out of Ukraine prove the absolute, utterly critical, centrality of coal, gas and oil – fossil fuels all – in our every-day 24/7 energy needs and indeed our very existence. Despite the trillions of dollars already wasted around the world on useless wind and solar, 85 per cent of global energy still comes from coal, gas and oil.
Just 5 per cent comes from so-called ‘renewables (not including the real renewable, hated by Dark Greens, hydro) after all those trillions. The trillions more that Carney talks about will barely take it up to 10 percent. And people like Carney never talk about China, pumping one-third of global emissions today and yet more tomorrow, other than to make fatuous and false claims China is ‘taking action on climate change’.
Go coal, gas and oil to keep the lights on; go renewables-woke, go broke and go dark. Talking of twerps, there was opposition leader and wannabe-PM Anthony Albanese Wednesday saying in a speech that he would be a PM like John Howard (and Bob Hawke). So, was that Albanese saying he intended to emulate the “petulance, pettiness and sheer grinding inadequacy” that he judged Howard as PM?
I’m indebted to blogger Michael Smith for highlighting a speech Albanese gave back in 1998 where he described Howard as a worse PM even than Billy McMahon. Is it Albanese’s intent to ‘match that’? I was particularly taken with Albanese’s reference to Howard – nicely highlighted by Smith:
“You can trim the eyebrows; you can cap the teeth; you can cut the hair; you can put on different glasses; you can give him a ewe’s milk facial, for all I care; but, to paraphrase a gritty Australian saying, `Same stuff, different bucket’.”
Looked in a mirror recently, Anthony?
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My other blogs. Main ones below
http://dissectleft.blogspot.com (DISSECTING LEFTISM )
http://edwatch.blogspot.com (EDUCATION WATCH)
http://pcwatch.blogspot.com (POLITICAL CORRECTNESS WATCH)
http://australian-politics.blogspot.com (AUSTRALIAN POLITICS)
http://snorphty.blogspot.com/ (TONGUE-TIED)
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Jim Hansen and his twin
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