Monday, October 31, 2022

HSBC’s greenwashing and the myth of stakeholder capitalism

Oh, the irony! Five months after infamously standing down its Head of Responsible Investment, Stuart Kirk, to appease a few outraged lobbyists and ‘capital market influencers’, HSBC has been allegedly engaging in a bit of greenwashing. As humorous as it is, HSBC’s blatant hypocrisy serves as a stark reminder of the risks that arise when companies give in to ‘stakeholder capitalism’ and try to appease everyone but their shareholders.

Around the time of the COP26 summit in October 2021, HSBC ran two advertisements in the UK. Largely in black, grey, and white (no doubt to create a sense of doom and gloom), each sought to tout the Bank’s apparent contribution to addressing Climate Change.

The first ad, with a wave crashing on a beach in the background, promoted the $1 trillion of investment and financing HSBC says it will use to assist clients ‘transition to Net Zero’. The second, featuring a picture of tree growth rings, promoted the Bank’s planting of 2 million trees. As anyone who has ever landed at Heathrow would know, the advertisements could easily be construed as a suggestion that HSBC is attempting to single-handedly save the world.

Whilst the UK’s Advertising Standards Authority didn’t put it quite that highly, it did recently hold that the advertisements represented to consumers that the Bank was making a ‘positive overall environmental contribution as a company’. What the advertisements didn’t mention was the Bank’s financing of significant greenhouse gas emitting companies and sectors. In the ASA’s view, this made them misleading.

HSBC is reported by the ASA as having stated in its defence that high greenhouse gas-emitting companies will require financing during a transition to Net Zero, that fossil fuels will be critical to energy security up to 2050, and that the Bank preferred a phase-down and industry engagement approach over divestment. HSBC also suggested that because of the publicity surrounding the COP26 summit, the average consumer would have been aware of the debate regarding the role of banks in relation to Climate Change.

These arguments clearly didn’t help. The ASA found that the advertisements were misleading, banned them, and warned HSBC that future advertisements featuring environmental claims must be appropriately qualified and not omit material information about its contribution to GHG emissions.

Based on what HSBC submitted to the ASA, none of this should have been a problem. After all, unlike many of its peers, HSBC claimed to understand that fossil fuels are essential to energy security. Yet since December 2021, the Bank has made a series of decisions that are in direct conflict with what it submitted to the ASA.

First, in December 2021, HSBC announced that would phase out the financing of coal used for electricity generation. Displaying not a skerrick of concern for energy security, the Bank said it would stop financing coal-fired power and thermal coal mining in the EU and OECD countries by 2030, and in all other countries by 2040. A full 10-20 years earlier than the Bank expressly told the ASA fossil fuel companies would require financing!

In March 2022, the Bank addressed its approach to other energy companies. Whilst it said it would engage with those companies, HSBC also said that if they do not produce climate transition plans that are compatible with its own Net Zero targets, it will consider whether to continue to provide financing. In other words, it’s the Bank’s way or the highway. So much for debate. HSBC’s Asset Management division made a similar announcement in September 2022, stating that it would immediately stop investing in IPOs or primary fixed debt issuance of any company involved in thermal coal expansion and that it would divest from companies that do not have transition plans that align with its timelines.

By May this year, HSBC was not just refusing to acknowledge the existence of a debate as to the role of banks in relation to climate, it was showing utter contempt for the idea. Following a now well-documented speech, Kirk was stood down. Yes, the speech was a bit sensationalist and probably deliberative provocative, but its substantive content merely raised questions about the time, money, and resources spent by investors addressing climate risks and made the argument for investing in adaptation measures. Never mind the Bank’s position that average consumers would understand that is a debate worth having, the outrage those questions apparently caused some on Twitter was enough for the Bank to effectively show Kirk the door.

So, contrary to what it told the ASA is necessary for energy security, HSBC has committed to stop financing and owning fossil fuel companies well before 2050, foreshadowed divestment, and indicated that it considers there to be no debate about the role of banks in relation to climate change.

Such contradictions are not surprising. Like many companies around the world, HSBC seems confused about the interests it is supposed to promote and protect. This demonstrates one of the big problems with stakeholder capitalism; by requiring companies to act in the interests of multiple groups with disparate and often conflicting interests, stakeholder capitalism can result in a complete lack of corporate focus, inherent contradictions, misplaced societal demands, and ultimately, a situation in which there are no winners.

In trying to boost its green credentials and appeal to certain stakeholders, HSBC was accused of misleading the public. HSBC has tried to step into the shoes of elected public policymakers without the constraint of being answerable to society-at-large and has committed to taking actions that have been shown to be more likely to exacerbate negative environmental impacts than reduce them. One group to whom the Bank is truly answerable, shareholders, have seemingly been forgotten. Perhaps the biggest irony in this story is that if it prioritised shareholder interests, HSBC would probably deliver more environmental benefits.

Not only is shareholder primacy what the law requires, but it is also necessary to ensure that accountability for public policy remains squarely with elected officials, and probably what will bring about the most enduring benefits for the environment and other stakeholders. The concept serves more than just shareholders and should be fought for with vigor. We will know we are back on track when you’re greeted at Heathrow by an HSBC ad featuring a coal mine.


What's wrong with being an apocalypse denier?

Brendan O'Neill
This week, on BBC radio, I made a confession: I am a denier. Not a climate-change denier – an apocalypse denier. I thought it was a clever point – to distinguish between my acceptance that climate change is happening and my scepticism that it will imminently bring about the fiery destruction of Earth. Apparently not. You should have heard the intakes of breath. Apparently even apocalypse denialism is unacceptable in polite society now.

It was on Nicky Campbell’s show on 5 Live. I was up against a spokesperson for Just Stop Oil and the question was whether that movement’s art-splattering and road-blocking antics are justifiable. I made my point – that Just Stop Oil strikes me as an out-of-touch movement that is mad to agitate for less energy production during an energy crisis. Don’t you know that many people, including vulnerable elderly people, are worried about how they’re going to keep the heat on this winter, I asked?

But it was when we got into the question of why Just Stop Oil is doing what it does – because it thinks the end of the world is nigh – that things really kicked off. ‘The world is burning’, said the Just Stop Oil person. Nicky Campbell put the point to me forcefully: ‘Millions of people will die worldwide…’ I started to respond – ‘This hysterical representation of climate change…’ – but I was cut off by gasps and shouts. Campbell made a noise that I can only transcribe as ‘Ohhhhhhewwwww’. Clearly I’d committed blasphemy. I had dared to doubt the imminence of End Times.

Over the huffing I carried on with my point: ‘Everyone accepts that climate change is happening, everyone accepts that mankind has an impact on his environment, and that some solutions will be required to alleviate that impact.’ But, I continued, ‘The presentation of that as “the world is burning”, and there’s an apocalypse, and, in the words of Extinction Rebellion, that billions of people will die – that is untrue.’

It wasn’t enough. Campbell asked if I had read the Intergovernmental Panel on Climate Change (IPCC) reports (I have: I couldn’t find anything about billions of people dying). The Just Stop Oil spokesperson branded me ‘dangerous’ and said ‘deniers’ like me should not be ‘taking up precious airtime’. You are a ‘total denier’, she said. ‘I’m an apocalypse denier’, I replied. After that I was pretty much frozen out of the discussion. My sin was too grave. They carried on with their Armageddon chat.

It is no longer enough to accept that the industrial era has impacted on the environment. You must also repeat the millenarian mantra about the coming heat-death of humankind. Acceptance of science will no longer ward off accusations of denialism. You must also accept a hyper-moralised, hyper-politicised interpretation of that science as proof that mankind is a singularly destructive force, that modernity was a mistake, and that the world will end if we don’t stop oil, stop gas, stop nuclear and stop pretty much everything. Bow down to that dire ideology or you’re in trouble.

But it’s untrue. And it’s unscientific. As the American writer Michael Shellenberger has said, the Extinction Rebellion claim that ‘life on Earth is dying’ and ‘Billions (of people) will die’ is not substantiated by anything resembling science. ‘No credible scientific body has ever said climate change threatens the collapse of civilisation, much less the extinction of the human species’, Shellenberger points out. The IPCC predicts a sea level rise of two feet by 2100. That doesn’t sound apocalyptic, especially as we have 80 years to prepare for it. ‘There is robust evidence of disasters displacing people worldwide’, says the IPCC, ‘but limited evidence that climate change or sea-level rise is the direct cause’.

As for billions dying, the truth is that far fewer people die in natural calamities today than in the past. ‘In 1931, 3.7m people died from natural disasters. In 2018, just 11,000 did’, says Shellenberger. And that decline occurred in a period in which the human population quadrupled and more and more of the world was industrialised. The unscientific cry that ‘the world is burning’ – the world clearly is not burning – distracts attention from the provable and wonderful fact that billions of people’s living conditions, life expectancy and safety from calamitous weather have improved in recent decades.

So yes, climate change is happening. And it poses a practical challenge for humankind. But it’s not an apocalypse. I remain an apocalypse denier. Someone in that radio discussion was making scientifically questionable claims – it wasn’t me.

The most striking thing was Nicky Campbell appearing to gloat at the fact that the BBC no longer has to be balanced on climate change. ‘We don’t have to have balance on this topic on the BBC’, he said. ‘It’s like evolution. The science is absolutely clear. So the days of me not being able to say “You’re talking baloney” are over.’

That is extraordinary, is it not? Of course if the BBC wants to ban what it considers to be unscientific views on climate change, that’s its prerogative, though I think even that is a mistake, given that there must surely be contrasting scientific takes even on this issue. But if it starts to sideline people who call into question the politics of all this, who challenge the fearmongering of certain eco-hysterics, then it will be engaging in political censorship, pure and simple. So, BBC, you censor climate-change denialism, we know that. But what about apocalypse denialism? Is that still allowed? Is it still permissible to express faith in humankind and to defend modern society on your network?


Fracking fury: Industry body hammers Sunak after shale gas U-turn

The UK’s leading onshore energy body has expressed its fury with Prime Minister Rishi Sunak’s apparent decision to re-impose the ban on fracking – just weeks after it was lifted.

Charles McAllister, director of policy for UK Onshore Oil and Gas (UKOOG), warned banning fracking would risk the UK being reliant on imported supplies for a decades – undermining supply security and ramping up emissions.

He told City A.M.: “If this is true then we are stunned that such an illogical U-turn would be taken by the Government in the middle of an energy crisis, at the expense of UK households and businesses.

“If reports are accurate, then a decision has been made to lock the UK into reliance on imported gas for decades. The geopolitical, environmental and economic consequences of such a decision will last far beyond the two years remaining of this parliament.”

UKOOG highlighted that Sunak had previously expressed his support for fracking provided local communities supported it during the previous leadership campaign this summer.

Mc Allister said: “The scientific consensus is, as the Prime Minister noted a few months ago in his support of fracking, that the seismic activity from shale gas development is not out of the ordinary compared to other industries in the UK, such as quarrying, geothermal and construction.”

Downing Street confirmed yesterday Sunak will drop former Prime Minister Liz Truss’ plans to end the England ban on fracking.

He told MPs in the House of Commons that he “already said I stand by the manifesto on” fracking, which committed to maintaining a moratorium on the practice unless scientific evidence shows it’s safe.

Truss’ decision to end the shale gas extraction ban triggered a major backlash among Tory MPs, with a Labour vote on the issue last week leading to chaos in the House of Commons.

The vote, which saw confusion about the government’s instructions to backbenchers and alleged physical bullying by senior ministers, directly led to Truss’ downfall the next day.

Fracking: There and back again

Fracking involves injecting water, sand and chemicals at high pressure into boreholes deep underground to fracture rock and release shale gas.

The latest setback for the sector is only the latest chapter in a dramatic 12 months, which has seen fracking move from the verge of closure to reopening, only to be re-banned yesterday.

The Government imposed a moratorium on the practice amid concerns over tremors and safety.

Its manifesto in December 2019 said the party would “not support fracking unless the science shows categorically it can be done safely”.

Earlier this year, the North Sea Transition Authority (NSTA) ordered Cuadrilla to plug the UK’s two remaining shale wells.

However, following Russia’s invasion of Ukraine, NSTA gave fracking a reprieve – pausing its plugging requirement – before the Government decided to commission the British Geological Society (BGS) to conduct a scientific survey on the practice to assess whether the process could be made safer.

The survey suggested that while concerns over tremors remained, there was a case for exploration and drilling to determine the scale of opportunity and the viability of fracking.

BGS argued that more data collection is needed in the UK to ascertain fracking’s safety and potential.

UKOOG has has previously cited data from the BGS forecasting there could be as much as 37.6tn cubic metres of shale gas under the ground.

If ten per cent was recoverable, UKOOG argues this would be enough to help meet the country’s energy needs for the next five decades.

However, fracking remains unpopular compared to other energy activities, such as onshore wind and solar power, with YouGov polling from May suggesting the people oppose the revival of fracking by a 46-29 margin.

The Government’s most recent polling – conducted last autumn – found just 17 per cent of the public supported fracking, compared with 87 per cent who backed renewables.

UKOOG had pledged to work with the Government and local communities over potential shale gas extraction sites.

This included potential compensation and community funding.


Australia: Cheap renewables, rising power bills?

James Macpherson

I cannot work out which is more incredible – the claims this government makes, or the fact that this government expects Australians to believe their claims.

Labor continually promises to reduce cost of living while increasing the cost of living.

Their strategy to lower prices is to increase prices.

If I could afford to laugh, I would.

Renewable energy is the cheapest form of energy, the Prime Minister chants zombie-like, as prices rise in direct proportion to his use of renewable energy.

I swear, every time he utters the words ‘renewable energy’, my power bill goes up.

Australians are caught in a kind of twilight zone where we are continually told to expect cheaper power while continually told to expect more expensive power.

Oh, but don’t worry, you’ll still get that promised $275 cut to your power bill. It’s just that your power bill will have gone up by a couple of thousand dollars before Labor cut it by a couple of hundred dollars.

The Prime Minister will then claim, with a straight face, that he has saved us money. And my teenage son worries that he is the one struggling with math!

This is a government that believes it can keep global temperatures in check when it can’t even keep a $275 promise to struggling families in the suburbs.

Treasurer Jim Chalmers explained today that the delay in providing the promised cut was due to a flaw in the modelling.   ‘That model was done in 2021, and it referred to an outcome in 2025,’ he said.

But don’t worry, the government’s modelling about how taxing cow farts will stop the warming of the planet and the rising of the oceans is totally legit!

This Labor government insists that renewable energy is the cheapest form of energy, or at least it will be, just as soon as they spend another $10 billion of your money here, and another $10 billion there.

How much will it cost taxpayers to end up with cheap power?  The answer is always the same. Just a little bit more.

If you believe the government’s obsession with intermittent energy will deliver cheap power, you have the one prerequisite necessary to do energy minister Chris Bowen’s job – wishful thinking.

Expect him to provide a unicorn with your next power bill.




Friday, October 28, 2022

Sweden scraps its climate change department

It was a bit of a shock, but the citizens of Sweden have finally tired of the left’s green and pro-crime agenda and for the first time in decades tossed them out of office.

The first thing that the newly elected Prime Minister, Ulf Kristersson, did was scrap the country’s climate change department that promoted the World Economic Forum’s (WEF) agenda of net-zero carbon emissions by 2030.

Armstrong Economics provides more details:

“New Prime Minister Ulf Kristersson is not heeding to the Green agenda. He promptly eliminated the entire Ministry of Climate and Environment, marking the first time in 35 years that Sweden does not have a specific climate ministry. People are crying that the world will crumble without funding bureaucrats who pretend they have the ability to alter the weather cycle with enough funding.“

The Swedish government will also be restarting two nuclear reactors that were also shut down by the previous government’s green agenda and is also budgeting additional money for new nuclear power plants.

It is the WEF’s net-carbon emission schedule, Agenda 2030, which has resulted in several western countries facing severe energy shortages this winter after embracing the WEF’s radical climate change agenda.

This included not only cutting back on the use and development of carbon-based power plants but nuclear as well and in turn embracing unreliable and expensive green energy.


Europe's energy crisis heaps pain on heavy industry

Makers of metals, chemicals and gases said on Tuesday that the outlook for the final months of the year had worsened as concerns intensify that a surge in energy and raw material costs will shrink Europe's heavy industry.

French industrial gases company Air Liquide (AIRP.PA) flagged slowing demand from some customers in Europe while Swedish steel maker SSAB said it will cut capacity in the fourth quarter as demand in Europe slows. It already cut construction-related volumes in the quarter to end-September.

German chemicals maker Covestro (1COV.DE) lowered its 2022 earnings guidance for the third time this year, blaming gas and raw material prices.

The company, whose main products include foam chemicals used in mattresses, car seats and insulation for buildings, said it was only able to offset part of the rise in costs through higher prices.

Gas prices in Europe have eased in response to an unusually warm October and projections of a mild winter.

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But the continent is paying five time more for its gas than the United States, stirring concerns the region will struggle to compete on the global market in the long term.

"A mild winter alone can’t save the day in Europe. Growth is slowing, the European Central Bank (ECB) is tightening, while the single currency remains weak," Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said.

BASF (BASFn.DE), the world's largest chemicals company, has reduced production of ammonia, a nitrogen fertiliser and input for engineering plastics and diesel exhaust fluid. The group, which relies heavily on natural gas, is buying from outside Europe, where prices are lower.

Data has also highlighted the impact. Euro zone manufacturing activity this month hit its weakest level since May 2020.

The downbeat manufacturing outlook is in contrast to food and consumer products companies, including Nestle (NESN.S) and Procter & Gamble (PG.N), which have passed on higher prices for goods ranging from Nescafe coffee to Gillette razors.


Companies across Europe are racing to reduce their energy use ahead of the winter when demand increases as households turn up the heat.

For example, Covestro said on Tuesday it is using digital sensors to monitor its steam traps, which means it is using steam as efficiently as possible in production.

Chemical companies are among the hardest hit by the energy crisis because they use gas as a raw material for production and as an energy source.

Swedish engineering group Alfa Laval (ALFA.ST) on Tuesday launched a cost-cutting drive that could affect around a tenth of its workforce after a weak tanker market and soaring costs hit its marine business.

Mercedes-Benz (MBGn.DE) has laid out measures to reduce gas consumption by up to 50% but has yet to manage a cut of more than 10%, while Volkswagen has explored short-term measures such as stocking parts on ships and trains and, in the medium term, switching to suppliers abroad.


Renewable energy is a failed path, scientist tells Utah legislators

A Utah legislative committee this week gave 45 minutes to a scientist who argued that policy makers across the globe are committing a grave mistake by turning to renewable energy.

William Hayden Smith, a professor of earth and planetary sciences at Washington University in St. Louis, wrote a research paper with colleagues in Switzerland and South Africa that claims to calculate a full cost of producing electricity from various sources. The paper was published this year in the Journal of Sustainable Development, a Canadian scientific journal.

“Now everyone will say that wind turbines and photovoltaics are cheaper than fossil fuels,” he told legislators. “That’s a stretch.”

He said the standard for comparing costs of electricity sources is called “Levelized Cost of Electricity,” which is calculated by adding up the total costs of a source over its lifetime and dividing it by the total energy expected from that source over the lifetime.

But Smith and his co-authors created an alternative metric they are calling the “full cost of electricity,” which he says factors in renewable energy costs not considered in LCOE, including the cost of storing power when renewables are not producing and the cost of replacing solar panels and windmills when they wear out.

He pointed to recent problems in Germany, where energy prices have shot up after Russia invaded Ukraine. He said Germany’s rush to renewables and decision to shut down nuclear plants is costing them now.

Beyond cost, wind and solar simply can’t meet the capacity, he said. “Every day the grid will collapse because you can’t meet the peak power.”

He also dismissed the idea that there is enough land available for the wind and solar farms to produce what fossil fuels do now. Thousands of square miles of wind and solar farms would be required. He added that windmills strike millions of insects, and no one is considering the biological effects.

Smith is a scientific and technical adviser to the CO2 Coalition, a nonprofit organization established “for the purpose of educating thought leaders, policy makers and the public about the important contribution made by carbon dioxide to our lives and the economy.” He is not compensated for his work, according to the coalition’s website.

Smith presented to the Public Utilities, Energy and Technology Interim Committee at the invitation of Rep. Ken Ivory, but Ivory had a conflict and could not attend. No other viewpoints were presented.


Environmental extremists: iconoclasts without a cause

I wrote in June of a climate activist’s attempt to attack the Mona Lisa, smearing cake over its protective glass fa├žade after failing to break it. In the short few intervening months there has been an epidemic of such recalcitrant acts of barbarity accompanied by unlettered lectures of vague Last Judgment prophesies.

In July, two students damaged Constable’s The Hay Wain by gluing large pieces of paper over the painting. Within days of each other in October, ‘protesters’ threw tomato soup at Van Gogh’s Sunflowers in London and mashed potato at Monet’s Les Meules in Potsdam. Earlier in the month, black-clad Extinction Rebellion acolytes glued themselves to Picasso’s Massacre in Korea in Melbourne.

It is lucky that none of the artworks were seriously damaged, but at this rate, soon an irreplaceable treasure will be.

The fanaticism fuelling the climate extremists are akin to the worst of religious zealotry, reminding one of the bonfire of the vanities (when supporters of Savonarola burned countless artworks and books that they saw as sinful, including paintings by the likes of Botticelli).

It is also reminiscent of the ideological radicalism of the Nazis, who stole an estimated one-fifth of all European art. Furthermore, ‘degenerate’ art, including many Cezannes, Picassos, Matisses, Gauguins, Braques, and Van Goghs, were simply destroyed. In the ignoble final throes of the Third Reich, many famous works were burned out of spite. One such lost work is Raphael’s Portrait of a Young Man, often seen as the most important piece of art lost since the second world war.

In the hellfire of an existentialist war, the Monuments, Fine Arts, and Archives Program of the Allied Armies came into being, with the express purpose to preserve cultural treasures. Compared to men and women who would risk their lives in war zones to protect art, those who live affluent lives in the first-world today – who self-righteously attempt to destroy art – seem rather paltry and contemptible.

While smaller in scale and (thankfully) lacking in competence, the new wave of eco-extremists share the same barbaric instincts to the puritans of yore, where anything is allowed given the conceit they have bestowed upon themselves, and the arrogance never to pause and consider that they might be wrong.

It is a new and fanatical religion with its own end-of-days prophesy (climate apocalypse), its original sin (petroleum), its priesthood (Greenpeace, Extinction Rebellion, Greta Thunberg etc.), and its sale of indulgences where celebrities and the elites like saint Leonardo DiCaprio, Al Gore, and all the VIP COP26 attendees are able to endlessly private-jet across the world to talk down to the proles about needing to cut back on indulgences such as heating their homes and driving to work.

Even minor acolytes, such as one of the students who damaged the Constable masterpiece, has admitted that she ‘impulse flew to the Canaries to escape chilly British weather’. Her Instagram shows her holidaying in places like Bali, Australia, and Greece. But redemption is possible, so she would seem to think, by taking out her guilt on old paintings in an act of petulant depravity.

Eco-activists obviously forget, in their delusion of an antediluvian world of prelapsarian purity, that their lives are ensconced by the comforts of fossil fuels and the thousands of other products derived from petroleum. They are ignorant of the consequences of their ideology, which is coming into sharp relieve as the Russians restrict gas to a Europe ready to shiver through a hard winter.

Preserving the environment is a worthy venture. It is also a complex and multifaceted issue, the science of which is not remotely ‘settled’. While every voice should have a place at the table, those who simply shout are not conversing, while those who engage in petulant destruction should simply be punished.

I warmly welcome Douglas Murray’s proposed cash prize for anyone who stops an attack on a painting. Up with this, we should not put.


Thursday, October 27, 2022

Green New World: As heating oil runs low and prices soar in N.Y. and the northeast, news agencies tell Americans to grab a blanket

By Robert Romano

Home heating prices are soaring this coming winter, especially in New York and the northeast, where heating oil shortages are looming before the winter has even begun.

On Oct. 13, there was a 26-day supply of home heating oil left for the northeast U.S.

By Oct. 24, it was down to a 25-day supply, the lowest since 1993, as calls to release the Northeast Home Heating Oil Reserve have already begun, and it’s not even November yet.

According to, if released the Northeast Home Heating Oil Reserve could boost supplies for about a week or two: “The reserve would give Northeast consumers supplemental supplies for approximately 10 days, the time required for ships to carry additional heating oil from the Gulf of Mexico to New York Harbor.”

Amid the shortages — not merely confined to oil — the U.S. Energy Information Administration projects that the cost of heating American households will increase 27 percent to $2,354 this winter for heating oil, 10 percent by electricity to $1,359, 5 percent for propane to $1,668, and 28 percent for natural gas to $931. 

This is what happens when every country in the world deliberately shuts down production, as it did in 2020, not just for petroleum but all commodities and other products during the Covid economic lockdowns. Production still has not caught up to pre-Covid levels, even as demand has continued to increase.

The short-sightedness, exacerbated by green policies designed to disincentivize oil and coal production and consumption, has meant the supply crunch was not met with a production surge as inflation instead consumed household spending, and with the crisis further exacerbated by Russia’s invasion of Ukraine, another recession is already upon the global economy. In that sense, it is also wartime rationing.

Now, news agencies have even begun promoting the rationing, for example, Fox 61 in Connecticut interviews one elderly homeowner who is already stockpiling blankets for her home.

The Columbus Dispatch’s Mark Williams tells Ohioans, “Grab a blanket: Heating costs to soar this winter.”

Anecdotally, I listened to a similar report on local WMAL in northern Virginia last week, urging listeners to get blankets because of surging home heating costs this winter.

In Europe, where home heating prices are even higher, electric blanket sales (and prices) are soaring in the UK and Germany, a craze that could easily stretch across the Atlantic.

Dressed up as noble conservation, the language is plain and clear: We don’t have enough energy to stay warm. This is what a reduced carbon economy looks like in the winter, and over the longer term, in New York, the northeast and the rest of the U.S., blankets might be little comfort in what looks like it will be a brutal transition into the Green New World.


EV Owners Pay Up: It Costs $6,100 Just to Replace GMC Hummer EV Taillights

Would you pay over $7,000 to replace a set of taillights?

According to Car and Driver, that could be the cost — depending on local taxes and the prevailing labor rates where you live — to replace the taillights on the new GMC Hummer EV SUT.

That expense, of course, would come only after you’d shelled out $110,000 to buy the thing in the first place — or, perhaps more likely, while you were repaying the bank for shelling out that amount on your behalf.

Of course, if you can afford that sticker price, maybe $3,045.48 per taillight plus labor and taxes wouldn’t mean much to you. Maybe you replace your car every time the ashtrays get full. (I know; it’s an old joke. I can’t remember the last time I saw a new car with an ashtray.)

The issue came up when an owner posted in a Hummer EV Facebook group about needing a “new passenger side rear light” for his vehicle, according to The Drive. (If I paid $110,000 for an automobile, I’d probably need to join a support group, too.)

That driver was quoted $4,040 for the part alone, plus labor.

Even at the MSRP, The Drive noted that replacing both taillights would run an owner more than 5 percent of the total purchase price of the sport-utility truck. That’s … something else.

The Drive was unable to confirm the reason for that pricing, but the website’s speculation seemed reasonable.

“The taillights in the Hummer EV have small microcontrollers installed within them,” they wrote. “These chips control unique lighting functions in their respective lights, like the animations in the headlamps.”

OK, cool, I guess. But it makes me wonder if I could get a cheaper, animation-less version that just, you know, tells drivers behind me when I’m braking and turning and stuff. Cars did that pretty well 60 years ago before microcontrollers were even invented, I believe.

“Additionally, the Hummer EV is a fairly limited-run vehicle thus far, meaning parts are generally more expensive until economies of scale kick in,” The Drive added. That I can understand, and it provides at least some reason to hope that parts prices will moderate over time.

That’s a reflection of the newness of the electric vehicle industry overall, in part. Another reflection of that newness has been the problems with electric vehicles that keep making the news.

One Hummer failed in spectacular fashion in the middle of the road when it inexplicably went into “safe” mode and had to be towed before someone rear-ended it.

That vehicle was reportedly brand new, with only 250 miles on it.

Then there was the Hummer that managed to pull a trailer only 128 miles before needing a recharge — which would require unhitching the trailer if the driver wanted to use the faster, more powerful charger.

Of course, electric vehicles are cheaper to run than gas vehicles in most cases, and if you have solar power to charge yours and do a little careful planning, you can practically drive it for free — locally at least. That’s assuming you can afford to buy it in the first place.

Obviously, fuel cost isn’t the only point at issue when choosing a new car, but it’s certainly not an unimportant one.

So, the question remains: Would you pay over $7,000 to replace a set of taillights?

Yeah … me neither.


Long-term Greenie journalist Graham Readfearn is still looking at the world through one-eye

He does his best  below  to make a case against the use of coal in Australia, but mainly does so by quoting fellow Greenies.  The blithe mention of "storage" as an alternative to burning coal is amusing.  What storage?  Snowy 2 is not yet up and may nevrer be, Qeeensland's pumped storage is pie in the sky and would be so expensive that it will remain there, and the available battery storage is tiny and short-lived relative to demand.

And there is some very stretched reasoning below.  Look at the statement "I’m not aware of any time where we have had a blackout because renewable energy hasn’t supplied sufficient electricity.”

It's a true statement.  But why?  Because every time we were on the brink of a blackout because of failing wind and solar, coal and gas generators have stepped into makeup the shortfall.  Lose those generators and the blackouts will be extensive and long

In Sydney’s Daily Telegraph, columnist Erin Molan turned the caps lock on to declare “WE NEED COAL”. It’s tempting to respond with “NO WE DON’T” and leave it at that. But there are certain expectations from a fact-checking column.

Molan argued clean and renewable alternatives to fossil fuels with the “infrastructure in place” to support them did not currently exist. Let’s test that.

Alison Reeve, an energy and climate expert at the Grattan Institute, said in the electricity market “coal has been doing two things”. “Providing electrons and system stability. The renewables can substitute the electrons and we can use other things – like storage and demand management – to find system stability. “So you only need coal to the extent that you don’t have those other things lined up yet.”

She said while there were legitimate concerns about the pace that storage and other measures were being added, “that’s not a case for keeping coal”.

The Australian Energy Market Operator’s blueprint for the expected future of the electricity market – a plan released after consulting more than 15,000 analysts and stakeholders – also disagrees with Molan. That plan includes several scenarios for the future, but the one Aemo says experts think is most likely sees 60% of coal generating capacity gone by 2030. Why?

“Competition, climate change and operational pressures will intensify [for coal] with the ever-increasing penetration of firmed renewable generation,” the plan says.

Oh yes, climate change. Burning coal is the biggest single contributor to the climate emergency.

Since Aemo’s blueprint was released in late June, both the Queensland and Victoria state governments have announced major energy plans mapping the exit route for coal that are broadly in line with Aemo’s plans.

Neither state sees a future in burning coal, with the polluting fuel practically gone in both states by 2035.

Coalmining is also responsible for about one fifth of the country’s greenhouse gas emissions from methane, according to official figures. The actual number, according to data from the International Energy Agency, could be double that.

As the Albanese government this week signed a global pledge to cut methane emissions by 30% by 2030, mining more coal will make those targets – nonbinding, but geopolitically significant – harder to reach.

Molan claimed in her column there was “ample evidence in recent years of times and occasions when renewables just haven’t been able to supply our energy needs”, but didn’t actually offer any evidence.

This is a strange interpretation of how the electricity market works. Reeve was puzzled. “It’s a mixed system and you will always have the generation you need to meet the demand. “The percentage provided by renewables fluctuates, but I’m not aware of any time where we have had a blackout because renewable energy hasn’t supplied sufficient electricity.”


The chilling reality of The Australian Labor Party's  green dream: Bills soar by 56% as $20 BILLION is spent on a 'renewables friendly' electricity grid and $46M for a UN energy conference - while the PM hands millions to extremists who dream of driving Australia into energy poverty

Despite constant claims renewables are cheaper than fossil fuels the billions being poured into greening Australia's power and hosting UN climate talkfests appears to be only driving up the price of electricity.

Labor went into the May election with a promise of slashing electricity bills by $275 a year, a pledge that was meant to be delivered by its commitment to renewables. 

However, Tuesday's Budget instead predicted a staggering 56 per cent hike in prices in the next year on top of the already ballooning bills. 

But at the same time the Albanese government announced they will funnel $10 million into climate activist groups the Environmental Defenders Office and Environmental Justice Australia.

When asked about this in parliament on Wednesday Prime Minister Anthony Albanese repeated the mantra of his government.  'The cheapest form of new energy in this country is renewables,' he said.

On budget night Treasurer Jim Chalmers told the ABC that despite him not being able to predict when prices would come down the $25 billion being spent on various climate change measures would help.  'Renewable energy isn't just cleaner energy, it's cheaper energy as well,' Chalmers said.

North Queensland Nationals Senator Matt Canavan, who is a strong proponent of mining and fossil fuel, strongly disagreed with both the Prime Minister and Treasurer.  'Power prices are going up because we are investing too much in renewable energy that is not on all the time,' Senator Canavan told Daily Mail Australia on Wednesday. 'Australia has been building more solar and wind per person than any country in the world.'

A particular Budget item that Senator Canavan latched onto was the almost $50 million the Albanese government has committed to 'restoring Australia's reputation'.

The centerpiece of this measure will be hosting UN-overseen conference in partnership with Pacific island nations to build clean energy partnerships and agreements . 

'Labor can't help you with your power bills but they are going to spend $46 million of your money to host a UN climate conference,' Senator Canavan tweeted on Tuesday night. 

He expanded on this in a response to Daily Mail Australia. 

'Instead of spending money on helping rich people attend a climate talkfest, the Australian Government should be using our coal, gas and uranium to make more power and bring down living costs for struggling Australian families,' he said. 

'The Government is wasting our money by funding more jobs for climate bureaucrats.'

The budget contains a mind-boggling multitude of green projects, subsidies and new government agencies to bring about the Albanese government's commitment of net zero carbon emissions by 2050. 

There is even $8.1 million to improve the energy efficiency of seaweed farmers. 

However, by far the biggest sum, $20 billion, will be for rewiring the nation's grid to make it more renewable energy friendly. 

On top of this $275 million will be spent on getting more electric cars on the road while $224 million will toward the community batteries that will store power from household solar panels. 

Re-establishing 'international climate leadership' will cost $296 million, of which $200 million will go to help Indonesia with green projects. 

A new agency, the national health sustainability and climate unit, will inform Australia's 'health response' to climate change.  

The green bureaucracy will also be beefed up by the injection of a further $194 million, with $102 million to restore the Climate Change Authority and $64 million to rebuild Treasury's climate modelling capability. 

Senator Canavan delivered a scathing assessment of what the new public servants would achieve.  

'Power prices won't be lowered from a desk in Canberra, they can only be lowered by building more generators across our nation,' he said. 

The Environmental Defenders Office have campaigned to block laws aimed at stopping disruptive climate protests, such as the protests that halted coal loading at Sydney's Port Botany earlier this year.  

Environmental Justice Australia lobbies against new coal and gas projects and organised a group of children and teens to claim Australia's lack of action on climate change violated their human rights to the United Nations.

To support his claim that renewables are cheaper Mr Albanese cited agreement from the Business Council of Australia, the Australian industry group, the Australian Chamber of Commerce and Industry as well as the National Farmers' Federation.

However, this has not been backed up by players in the electricity market. Major energy retailers told a conference in October that replacing coal and gas with renewable energy is the major reason power prices are sky-rocketing.

'Next year, using the current market prices, tariffs are going up a minimum 35 per cent,' Alinta chief executive Jeff Dimery said at the Sydney event. 'It's horrendous, it's unpalatable. We don't want energy consumers getting their power bills and setting fire to them.'

In September reports by sector watchdogs the Energy Security Board and the Australian Energy Regulator (AER) both pointed at switching to renewables as a major reason power price surges.

Dr Chalmers pointed to 'inflationary pressures' for the power price increase but electricity bills have been outstripping inflation by as much as 8 per cent.

The war in Ukraine is often pointed to as major contributor to worldwide inflation but Australia is energy sufficient in coal and gas and an exporter of those things, although international prices can influence the domestic price.

Coal prices are surging but this reflects a turning away from renewables in many countries.

With the Ukraine war threatening its gas supplies Germany has began bringing around 20 of its coal power plants back online.   




Wednesday, October 26, 2022

Green Davos: Climate sceptics charm investors

Dr David Whitehouse

The Ballroom of the Dorchester Hotel in London is not somewhere I frequent very often, but the so-called Climate Change Forum conference is always held in such grand places. It’s a conference for what it calls high-net worth individuals, with not a few policy makers, royal families and international celebrities thrown in. The conference was called “Global Investment in Sustainable Development.” Delegates flew in from all over the world. Marc Morano of Climate Depot called it the “Green Davos.”

For the day I was there I was impressed with the ideas circulating around the informal areas. One person told me about his plans for recycling in Africa, another for removing plastic from the oceans, another about how to make hydrogen the fuel of the future. One person told me they founded an institute for global change. I spoke to a couple of others who ran a group advising firms how to achieve their net zero targets – weaving the words resilience, productivity and creativity into almost everything they said. Perhaps this is not the place for details. Offer the pitch, follow up later. One person told me that there are three ways to make money: one is with a good idea, one is to use the system of subsidies, grants and carbon credits to your advantage. And the third? I asked. “Look at the science soberly and then think long-term,” he said.

With investment in sustainability the topic of the day the science of climate change was always in the background. I asked many if they could tell me what the global temperature is and how it has changed in recent years. They couldn’t, adding that all they knew was that it was increasing, everyone knew that.

Outside the ballroom was a stand where a corporate health group had set up, not financial health but spiritual help. One of its proprietors told me that you make better corporate decisions when you are in spiritual harmony with the planet. He would be delighted to come to my boardroom and tell my company how to do it. I didn’t ask how much it would cost, seemed impolite.

At the conference proper someone talked about connecting humanity back to its heart’s values. I looked her up on social media – she had fewer twitter followers than me. Someone else was talking about how to avert the coming global disaster. I quickly looked him up: his investing firm lost more than a million pounds last year. I hope they don’t follow his advice. Another presentation was from Mastercard whose Vice President was talking about a new credit card that counted your carbon dioxide consumption and would cut off your access to money when you had reached your carbon allowance. I don’t think many of the attendees would be keen to use such a card! Someone else was talking about music for climate justice, pity Bono wasn’t here!

The presentations were a mixed bag. Some were fascinating, others were puffery. Many of them trivial, given by representatives of very small companies looking for a green niche and a break. A session on diversity, mainly women, sounded almost like a Meghan Markle speech given six times. It was clearly important to be photographed at the podium, presumably for their website alongside a “connect to me” tab. I got the impression that many delegates didn’t regard the presentations as the main thing.

Sceptical Debate

The reason I was at the conference was to watch the debate between so-called climate deniers Marc Morano and Christopher Monckton and two other speakers. Credit is due to Max Studennikoff, the chairman and founder of CC Forum, who withstood numerous demands and requests to de-platform Morano and Monckton. One of the participants withdrew, saying that in all conscience he could not share a stage with such heretics, presumably preferring his preferred pastime of glueing himself to government offices in protest. I forget his name, as did everyone else.

The other withdrawal was UK Climate Minister Graham Stuart who was to give a keynote speech. He suddenly had unexpected government business, perhaps – it was joked – he was going to be the next Chancellor of the Exchequer. Later DeSmog activists claimed the credit for dissuading him. One person told me they were unimpressed by his absence: “This is just the audience he needs to talk to if he wants to bring growth into the UK,” he moaned.

The debate itself was all rather surprising. There was no frisson of annoyance or expectation of fireworks as Morano and Monckton made their way onto the stage. There was nobody in the ballroom who was there to protest or cause a disruption. They were interested in what they had to say.

The session was opened by Max Studennikoff who started by saying that extreme events, hurricanes, droughts, heatwaves, were all on the increase and, what’s more, the moat around his medieval castle in France was dry for the first time in 600 years! I saw Lord Monckton smile as this was a gift for him to counter. Studennikoff took this with good grace. After the opening statements I got the feeling that the audience decided that the sceptics were rather more substantial than some had expected. A person on the table next to me muttered, “hmmm details!”

There was not that much about climate during the debate as one might have expected. Energy policy, subsidies, clean water, pollution etc. were discussed with not that much between the two sides. On the non-sceptic side one panelist said that after Krakatoa had put 20 million tonnes of sulphur into the atmosphere and cooled the world by one and a half degrees, just imagine what 50 million tonnes of carbon dioxide a year could do! Then he mentioned the 97% climate consensus which Monckton swiftly rubbished.

Gunter Pauli was a different matter. To my surprise he had a lot in common with Morano and Monckton and he clearly read the mood of the audience. Sometimes he veered into telling stories about himself, but the audience loved it. Unsurprisingly, the wealthy audience all seemed to agree that wealth is what was needed to clean up the environment. Morano said this came from cheap energy, Pauli said we needed a new system of business altogether and that Net Zero was nonsense and “the opium of the masses.”

The applause was slightly louder for the non-sceptic side, but not by much at all. But where was this applause coming from? One or two sceptical tables, I wondered. No, it was widespread, much of it from the quiet money. Such was the interest in the session that subsequent sessions were cancelled as it continued. No hostility, just some very good questions. Morano and Monckton were pleasantly surprised.


UK: Lloyds bank ditches project finance for new oil and gas fields

Britain's biggest domestic bank Lloyds (LLOY.L) said on Thursday it would not support direct financing to develop new oil and gas fields, joining a small number of lenders to push back on funding expansion of the industry.

Lloyds updated its climate policy to make the change, which bars project financing or reserve-based lending to greenfield oil and gas projects, although the policy would still mean it could provide general lending to companies in the industry.

Although Lloyds exposure to the sector is small, the move reflects growing pressure on banks to do more to accelerate the global transition to a low-carbon economy before the next round of global climate talks in Egypt in November.

It also comes just weeks after Britain pledged to give a green light for fresh exploration in the North Sea amid concerns about security of energy supplies amid the conflict in Ukraine.

Despite concern from campaigners that banks are helping lock in climate-damaging emissions, large lenders in the United States have faced political pressure to maintain the flow of capital and most continue to finance expansion in the sector.

Climate groups welcomed the Lloyds move and called on other British banks to follow suit.

"Lloyds' new policy marks an important turning point in the dangerous relationship that exists between leading UK banks and fossil fuel companies," said Tony Burdon, chief executive of pressure group Make My Money Matter.

"By becoming the first of the five largest UK high street banks to stop the direct financing of new gas, oil, and coal projects, Lloyds is making a clear statement on the future of financing for fossil fuel expansion."

Lloyds' exposure to dirty industries is smaller than some of its global rivals, given its focus on Britain's economy.

The bank provided about 1 billion pounds ($1.1 billion) of finance to commercial oil and gas customers last year, according to its latest climate disclosures report, and the sector accounted for just 0.2% of its overall lending


Lord Frost rounds on British government over ‘invented’ net zero targets

Former Brexit Secretary Lord Frost has rounded on the Government over its “invented” net zero target. He argued that the stated goal of net zero carbon emissions by 2050 was passed with “limited debate” and claimed it has had negative impacts on the energy sector.

Lord Frost’s comments were made during a debate in the House of Lords over what steps should be taken to support behaviour change as a pathway towards net zero. He said: “We all agree that decarbonisation is a very desirable goal, but I would say that aspiration is different from the specific net zero 2050 policy.

“That target was essentially invented by the climate change committee in 2019, passed through secondary legislation in this Parliament with limited debate, and since then has been creating radical change to the economic structure of this country. “And I think my own party is just as much to blame for this situation, and possibly even more so than members opposite.”

He argued that technical measures required to meet this target are expensive, both to install and in its impact on everyday life, that they increase the unreliability of the energy sector and have led to the destruction of reliable supply.

The Tory peer said he finds it “troubling” that behavioural change is being used to “fill the gap”.

He critiqued this method of decarbonisation, arguing it “reduces human welfare” because it “makes it harder for people to do things they would otherwise choose to do”.

Finally, he claimed that behavioural change measures are presented as being voluntary, but in some cases are actually achieved through “legal compulsion”, shrinking the private space of individuals.

He said: “The climate change committee in 2021 said that behaviour change comes through consumer adoption of low-carbon technology such as electric cars. “Well, you don’t get any choice about that – in 2030, you have to buy an electric car. “That’s not a nudging, that’s compulsion.

“Similarly, heat pumps in 2025, that’s compulsion. Closing roads for cyclists, that’s all compulsion. “If people mean legal compulsion, they should say it.”

Lord Frost’s comments come after the Bishop of Oxford urged the Government to do more in terms of supporting behavioural change.

The Right Reverend Steven Croft referenced a new report from the Lords’ Environment and Climate Change Committee entitled ‘In Our Hands: Behaviour Change for Climate and Environmental Goals’.

The spiritual peer praised the Government for its stated commitment to net zero but argued there was a “significant gap” between what it wants to do, and the leadership actually being offered.

He argued that behaviour change was a “key element” of achieving net zero, an estimated 32% of change needed, adding: “We must all play our part”.

Another member of the climate change committee, Lord Browne of Ladyton hit back at Lord Frost’s comments about behaviour change, branding his warning a “groundless accusation”.

The former Labour Cabinet minister insisted that the role of Government is one of enabling people to make more sustainable choices, not compelling them to do so.

He said: “To address the concerns of those who feel that the cause of net zero is being hijacked by those who do wish this regression I encourage them, including with respect Lord Frost, to actually read the reports before levelling these groundless accusations.”

He added: “We do not wish this or any future Government to remove the power of decision-making from individuals, but we want it to fashion a context in which the gap between ethical and practical decision making is closed.

“For those who wish to preserve individual liberty, including Lord Frost, surely a context within which people can make the decisions they wish to make on an ethical basis rather than purely practical considerations is desirable.”


Australia: ‘Over-designed’ government megaprojects are bad for environment and taxpayers

NSW megaprojects are being over-engineered with tonnes of unnecessary, costly materials driving up the price and carbon footprint of the multibillion-dollar builds, Infrastructure Minister Rob Stokes has warned.

Stokes said NSW would fail to reach its goal of a net zero economy by 2050 without addressing overservicing in its $110-billion infrastructure pipeline, where concrete and steel are being superfluously added to projects.

Carbon emissions from construction material – including concrete and steel – are estimated to represent up to 10 per cent of Australia’s carbon output. A new report produced by Stokes and Infrastructure NSW has flagged including those emissions in the business cases of future projects.

“We want things to be robust and well-built, but that shouldn’t mean just throwing more concrete and steel into our bridges, roads and railways,” Stokes told the Herald.

“There is an irony here. Because we’ve got very conservative design standards we’re actually putting more concrete and steel into roads and bridges and railways than anyone else in the world.”

Stokes pointed to the recent construction of the multibillion-dollar Metro rail lines as an example of a project that could have used less material without impacting design integrity.

“I think there is a general awareness that we have been very conservative and over-designed some of our station boxes on Metro lines,” he said.

The government is spending tens of billions of dollars on the Metro, which will connect the CBD to the west and south-west of the city, as well as a line to service the new Western Sydney Airport when it opens in 2026. The projects have been hampered by cost blowouts.

Station boxes are excavated for underground platforms, concourses and facilities, while major developments are often installed above them.

Infrastructure funding cuts leave NSW behind Victoria, Queensland
Stokes said a “compliance culture” in NSW had led to an intense focus on mitigating risk and liability in both the government and private sectors.

“I think every engineer that touches a project on the way through … just wants to ensure that their responsibility is entirely mitigated by throwing a bit of extra concrete and steel at it,” he said.

“The sum total of all these little decisions where people are just effectively covering their back means that we’re paying way over the odds, and also contributing toward global climate emissions because of our innate design conservatism, so we need to challenge that.”

The senior minister, who will retire from politics at the next state election, said that more thoughtfully designing the state’s largest projects would cut emissions, save time and taxpayer cash.

“We should be very proud of the fact that we are designing very, very robust structures, but the question we need to ask is, ‘Are we over designing them?’. There’s a cost imperative to that for the taxpayer,” he said.

“But there’s also a climate imperative because every bit of extra design constraint that adds to the bulk of a structure is making it more carbon intensive.”

The Infrastructure NSW discussion paper, set to be released this week, recommends a whole of government approach to measuring emissions in infrastructure.

The Decarbonising Infrastructure Delivery report says multibillion-dollar investment decisions were being made without any understanding of carbon mitigation or management over the life of the asset. It warns that could result in potentially higher costs to retrofit projects to achieve net-zero in the future.

The report also recommends maximising the use of recycled material in building.

The United Kingdom, including the Glasgow Airport Investment Area, and Europe are cited as examples of governments including the carbon impact of projects when weighing up their benefits and cost.

The NSW government earlier this year warned it would need to push back some of its mammoth infrastructure pipeline amid rising construction costs and limited workforce.

The government paper follows a report produced by Infrastructure Partnerships Australia which earlier this year called for ambitious, lower-carbon outcome requirements in major projects.

Stokes said future state governments would need to rethink the way they approached big projects, and instead start by questioning whether they should even go ahead at all.

“One of the very best ways we can decarbonise infrastructure is actually asking whether we need such an expensive megaproject design intervention in the first place. Maybe there are other ways to achieve the same objective,” he said.




Dozens of Climate Models Wildly Exaggerate Extent of Global Warming

Further evidence has emerged that climate models are useless for the purpose of forecasting future temperature rises. A recent survey using American summer temperatures (June, July, August) over the last 50 years, found that 36 major climate models showed nearly twice the warming rate observed by the surface temperature measurements recorded by the National Oceanic and Atmospheric Administration (NOAA). At the high end, a number of models forecast warming nearly three times greater than observed data show

The research was carried out by Dr. Roy Spencer, the principal research scientist at the University of Alabama in Huntsville, and the compiler of the UAH monthly satellite temperature record. He says that the importance of his findings should be obvious. “Given that U.S. energy policy depends upon the predictions from these models, their tendency to produce too much warming (and likely also warming-associated climate change) should be factored into energy policy planning,” he said. But he doubted it was being, ”given the climate change exaggerations routinely promoted by environment groups, anti-oil advocates, the media, politicians, and most government agencies”.

The Spencer work follows recent research published by Professor Nicola Scafetta of the University of Naples. He found that almost all the global temperature forecasts produced by models between 1980-2021 were excessive, some extremely so, compared with the accurate satellite record. One of the reasons given as to why there’s no climate emergency in the World Climate Declaration is that climate models are “not remotely plausible as global tools”.

Yet as we have seen in numerous articles in the Daily Sceptic, climate models are ubiquitous and are at the forefront of promoting the climate scares pushing the command-and-control Net Zero agenda. They are at the heart of the pseudoscientific work that tries to ‘attribute’ single extreme weather events to long-term changes in the climate claimed supposedly caused by fossil fuels. In simple terms, computers compare an imaginary climate without human-caused carbon dioxide with the current one full of unknown complexities, and then the modellers announce they’ve ‘proved’ the ‘climate emergency’ hypothesis. Since the outputs of these models are unfalsifiable – how can you prove that a wholly imaginary scenario is ‘false’? – the notions are no more than worthless opinions.

The results of Spencer’s work will hardly come as a great surprise, but the conclusions are almost certainly more damaging to the climate catastrophisers’ case than the figures suggest. Spencer uses NOAA surface temperatures and, as we have seen, these are subject to ‘corruption’ from a number of causes in recent years. As Spencer notes, the NOAA figure could be an over-estimate “if increasing urban heat island effects have spuriously influenced trends over the last 50 years, and I have not made any adjustments for that”.

Earlier this year, the U.S. meteorologist Anthony Watts published his latest survey of NOAA’s nationwide weather stations. Describing the temperature record as “fatally flawed”, Watts found about 96% of US temperature stations failed to meet what NOAA itself considered to be acceptable and uncorrupted placement. Watts defined ‘corruption’ as caused by the localised effects of urbanisation, producing heat bias because of a close proximity to asphalt, machinery and other heat-producing, heat-trapping, or heat-accentuating objects. According to Watts, data that had not been corrupted by faulty placement showed a rate of warming in the U.S. “reduced by almost a half compared to all stations”.

There is further substantial evidence that NOAA’s U.S. surface temperature figures are too high. In 2005, it started compiling data from a select group of 114 stations across the country that had been specifically sited away from urban development. Called the U.S. Climate Reference Network (USCRN), it was intended to aim for “superior accuracy and continuity in places that land use will not likely impact during the next five decades”.

The graph shows the rarely referenced record up to last month. It shows oscillating temperature changes, but very little evidence to indicate a warming trend over the last 17 years.

Considering what is known about the ‘corruption’ of the NOAA’s main temperature dataset, it would be reasonable to significantly reduce the blue NOAA observational bar in Spencer’s graph. This of course provides further confirmation that the temperatures forecasts of most climate models have long lost any connection with reality.


The Quiet Desperation Of Woke Fanatics

What's driving them? And how can they be defeated?

Over the last few weeks, climate activists in Britain have blocked highways (because cars emit carbon dioxide), poured milk onto the floors of supermarkets (because livestock emits methane), and thrown tomato soup at Van Gogh’s “Sunflowers” (because climate change is more important than art. Or something). The activists are a kind of reboot of the Extinction Rebellion (XR) climate protests in the UK in the fall of 2019.

People in the UK are at risk of dying from natural gas shortages. Still, the climate activists with “Just Stop Oil” think it’s outrageous that their government is desperately trying to produce more natural gas for its people. But without more natural gas, there could be three-hour-long blackouts, which threaten the operation of medical equipment, and thus the lives of vulnerable people.

The various media stunts appeared authentically grassroots but were, in fact, financed by a $1 million grant from a philanthropic group called Climate Emergency Fund, which is funded by their heirs to the Getty and Rockefeller oil fortunes, and founded in 2019. The Board of Directors consists of a who’s-who of climate alarmism including “Don’t Look Up!” film director, Adam McKay, who donated $4 million, New Yorker writer Bill McKibben, and New York Times columnist David Wallace-Wells. The Fund and their grantees have been cheered on by the Secretary General of the United Nations and much of the mainstream media.

In a series of recent articles I have argued that what lies behind climate fanaticism and narcissism is an apocalyptic religion born from nihilism. The power of science to explain humankind’s place in the universe (e.g., the big bang, evolution by natural selection) resulted in a dominant narrative coming out of society’s elite institutions for over 100 years that human life has no inherent meaning or purpose (nihilism). We’re just animals like any other.

This depressing story has led the ostensibly secular elite, which are educated and indoctrinated in universities that teach nihilism as unquestioning scientific gospel, to create a new apocalyptic religion (climate catastrophe), complete with a new victim-god (nature), a new reason for guilt (sins against nature), and a path for redemption (renewables and low-energy living). It, and the broader Woke religion, have found intellectual ballast since World War II from Rousseau, Malthus, and Foucault.

But that account only partly addresses the motivations of the fanatics. It doesn’t answer why some people become fanatics and others don’t. It doesn’t explain the specific role of fanatics, particularly in relation to other actors, such as the intellectual architects of the movement, and the institution-builders. Nor does it address how fanaticism ends and what, if anything, can be done to hasten its expiration date.

As such, we need to ask, who exactly are the climate fanatics? And how can their power over Western cultural and political life be reduced?


Reducing energy options doesn’t work. Just ask Europe—and the U.S. states where gas prices are rising

With midterm elections around the corner, energy and climate rhetoric is rising almost as fast as the price of energy in California.

While the public largely ignores Californian rhetoric, Europeans cannot escape the extreme cost of energy and must prepare for the most difficult winter in recent memory—a failure of the energy and climate policies of the past quarter-century. For U.S. states, there are lessons to be learned.

European policymakers have acted on the advice that solar and wind could scale up quickly, provide reliable electricity, and be cheaper than other options—none of which turned out to be entirely true. To be sure, there are factual components. But as a whole, the story was not factually complete. Europe is paying the price.

At the core of the problem is the reality that European leaders, led by Germany with Energiewende in 2010, have been eliminating energy options. Shutting down nuclear power plants. Banning production of natural gas from shale. Mandating electric vehicles. Importing energy and products from neighboring, often unfriendly, countries. Regardless of intentions, one must ask whether reduced optionality is working.

The result of reducing energy options is that the cost of energy in Europe has blown through the roof. Electricity is at 60 cents per kilowatt/hour, which is five to 10 times the cost of electricity in most U.S. states. Natural gas at $60 per thousand cubic feet is 10 times the price of natural gas in the U.S. Gasoline is $6 per gallon or more.

We no longer need to wonder what will happen with option-eliminating energy policies. It is happening, and the impact is being felt most by those who can least afford it. To be clear, it started long before the invasion of Ukraine by Russia. Russia merely took advantage of the situation created by long-standing policies.

In some ways, European countries are comparable to large states in the U.S. Just like most European countries, about 80% of U.S. states run energy deficits. New York imports 75% of its energy. California about 65%. Not that these states lack energy resources. Quite the contrary: They choose not to produce the energy they have, instead relying on energy imports from their neighbors.

The same goes for energy policy. California’s energy policy eerily mirrors Germany’s. California is the top importer of electricity. It’s banning gas hookups in some cities, mandating EVs, restricting oil and gas development, and shutting down nuclear facilities. New York refuses to build new gas pipelines and won’t develop the Marcellus Shale. Maine won’t mine its own major lithium deposit to make batteries to support its desired EV mandate.

As a result, people in California, New York, and Maine pay two to three times as much for their gasoline and electricity as those living in other states such as Texas. And just as in Europe, it hurts the poorest the most—and all in the name of “clean energy.”

If being clean means importing your energy from other emitters, it does not help the global climate. What if, as happened in Europe with Russian gas, neighboring surplus states decide not to send energy and products to energy deficit states such as California and New York? It would be devastating, just like in Europe.

Does this mean solar, wind, and batteries are bad? Of course not. They have a role to play. However, mandating them exclusively—and eliminating optionality in transportation, power generation, and other industrial processes—is not scalable, reliable, or cheaper.

Climate security, energy security, and energy poverty are major global challenges. They are not simple, but they are solvable. We must arm ourselves with all of the data, honor physics, and adhere to basic economic principles such as optionality.

The binary clean and dirty narrative is not just overly simple. It is simply wrong. It’s time to end factually incomplete energy rhetoric. It’s hurting us all. We need to find some humility again, engage in civil dialogue, agree to disagree at times, cancel shaming, and start seeking real solutions to complex energy and climate problems. Only then will we actually solve them.


The cult of absolutism

How often have you been told that balance is essential? Balanced opinion, balanced diet, and everything in moderation. Well, think again, because the new cult of absolutism won’t stand for it.

Do you want to discuss inequality? It must be zero. Do you want to debate harm from Covid? Must be zero. Gender inequities? Zero. Emissions? That would be Net Zero… When you subscribe to these absolutes there is no room for compromise or tolerance. The end justifies the means. Every single time. Zero deviation. Zero discussion. Zero empathy.

This new world order is infecting every part of our lives, right down to the functioning of our critical energy systems. From the politicians creating policy, to the boardrooms complying, right through to the bureaucrats enforcing it – our electricity system is undergoing a zero-logic makeover.

Take Queensland’s glossy ‘brochure’ announcement that spending $62 billion (more likely double that) to close some of the lowest-cost electricity generators on the planet will save consumers $150 per year by 2032. Ironically, Queensland residents were recently treated to a ‘cost of living rebate’ worth $175. Zero relief for businesses though, with state-owned hydro generators setting the wholesale price more than any other.

New South Wales Deputy Leader Matt Kean believes wind and solar generators should have zero exposure to low wholesale prices. He’s designed a scheme ensuring these ‘cheap new generators’ can opt into a guaranteed minimum wholesale price, thus avoiding the black hole in the market he created.

Victorian Premier Daniel Andrews must believe he can duck down to Coles and fill the trolley with Duracells because his government recently announced the world’s largest battery storage target. Andrews hopes this will create over 12,000 jobs, but there are zero cars parked in neighbouring South Australia’s infamous, and now ‘not-so-big’, battery.

If you are looking for regulators, politicians, or the media to provide a cost-benefit analysis, a detailed plan, or even a robust debate on these matters, your expectations are exceeding their capabilities. Nobody can even produce the napkins on which these plans have been hatched. You should have zero confidence in any statement originating from politicians on the electricity system, and unfortunately this applies to bureaucrats and agencies managing the system ‘in the best interests of the consumer’. Those behind these schemes display zero interest in the consumer, except as a means to an end.

A recent example is Daniel Westerman, head of AEMO (Australian Energy Market Operator), in an interview with Angela Macdonald-Smith. As the ‘market operator’ AMEO receives offers for electricity generation in time, money, and volume; tells every generator what to generate and when; and calculates how much each generator gets paid. Macdonald-Smith offers zero challenge when Westerman frets:

‘The events of the winter really have reinforced the need for Australia to continue to urgently invest in the transition towards firmed renewables with efficiently delivered transmission.’

Westerman’s zero-care for consumers is matched only by his opinions on areas for which he bears no responsibility, as MacDonald-Smith writes:

‘Westerman highlighted the need for action in four areas in particular; building low-cost renewable generation; putting in place sufficient firming generation to support peak demand when renewable generation is low; getting transmission built efficiently and in as timely a fashion as possible; and improving the stability of the grid and equipping it to deal with a high penetration of renewable energy.’

This is the same guy who pretty much on his first day of the job declared we’d be dealing with a 100 per cent renewable grid for 30-minute periods by 2025.

Thus, the tally of zeros increases because there are zero other countries in this predicament. One might consider Germany and California to be on the way. The cold 2022 European winter, without Russian gas, will prompt some changes; but more temperate California is losing people and businesses fast.

What conclusions can be drawn if we continue down this path of absolutes?

There will be zero baseload generators, at least those owned by Origin, AGL, and the Queensland taxpayer. Gas and batteries are hoped to fill the 20,000 MW gap when it’s not windy or sunny – that’s the current plan.

Zero renewable developments will be knocked back – the state and federal targets are too large and the timeframes too short for any dallying with environmental assessments, community engagement, or feasibility studies. Our federal Environment Minister decreed, godlike, that she will allow zero extinctions. Hopefully, she will be faced with many difficult decisions.

There will be zero accountability at the top end when power bills remain high. When regular people are subject to rationing, big industries pack up and disappear, or food suppliers continuously edge up prices, those in charge will just say ‘it’s the cheapest new generation, build more’.

And sadly, zero care for people freezing in winter.

How long can this flawed reasoning persist? Perhaps a better question – why is the reasoning so flawed to begin with? I believe the key lies in the personal values of those in authority. If you value people, their wellbeing, and opinions, you display care. Care’s neighbours are empathy, compromise and goodwill. Conversely, a lack of care exposes limited appreciation for others. Without care you are only a stone’s throw from cruelty.

This cult of absolutism and zero worshipping demands tyranny. Fight back, use care. ?




Monday, October 24, 2022

MPs kill UK fracking prospects in huge gift to Putin

London, 20 October - Opposition and conservative rebel MPs have been accused of acting against the national interest by ringing the death knell for Britain’s shale gas prospects in the near to medium future.

While a majority of MPs last night voted against Labour’s motion to introduce a ban on fracking, it is now clear that no company will risk investing in the development of UK shale gas projects given that the next government is almost certain to pull the plug.

By killing the chances of exploiting Britain’s massive shale gas resources, anti-fracking MPs have caused significant economic damage while ensuring that the UK’s energy cost and supply crisis will get worse in coming years.

In the absence of Russian gas supplies, European countries will face an even worse energy crisis next winter after they have depleted gas they have stored for this winter, the International Energy Agency has warned.

While anti-fracking MPs don’t seem to realise the severity and existential threat of the energy crisis to households and businesses they have simply deferred the inevitable: There can be little doubt that at some point UK shale gas will have to be explored as the energy cost crisis threatens to devastate Britain’s economy and industry.

Net Zero Watch director Dr Benny Peiser said:

"The evident failure to embrace fracking is destroying the most promising chances of enhancing Britain’s energy security while driving up energy costs. MPs have been playing into the hands of Vladimir Putin as Britain will now be forced to rely more and more on costly gas imports rather than its massive shale resources.

If the Westminster bubble think the current economic and political crisis is bad, they are in for a shock next year when energy bills go through the roof and businesses go under."


Dr Benny Peiser
Director, Net Zero Watch
m: 07553 361717

Net Zero Bombshell: The World Does Not Have Enough Lithium and Cobalt to Replace All Batteries Every 10 Years

Influential elites are either in denial about the horrifying costs and consequences of Net Zero – witness last Wednesday’s substantial vote against fracking British gas in the House of Commons – or busy scooping up the almost unlimited amounts of money currently on offer for promoting pseudoscience climate scares and investing in impracticable green technologies. Until the lights start to go out and heating fails, they are unlikely to pay much attention to a recent 1,000 page alternative energy investigation undertaken for a Finnish Government agency by Associate Professor Simon Michaux. Referring to the U.K.’s 2050 Net Zero target, Michaux states there is “simply not enough time, nor resources to do this by the current target”.

To cite just one example of how un-costed Net Zero is, Michaux notes that “in theory” there are enough global reserves of nickel and lithium if they are exclusively used to produce batteries for electric vehicles. But there is not enough cobalt, and more will need to be discovered. It gets much worse. All the new batteries have a useful working life of only 8-10 years, so replacements will need to be regularly produced. “This is unlikely to be practical, which suggests the whole EV battery solution may need to be re-thought and a new solution is developed that is not so mineral intensive,” he says.

All of these problems occur in finding a mass of lithium for ion batteries weighting 286.6 million tonnes. But a “power buffer” of another 2.5 billion tonnes of batteries is also required to provide a four-week back-up for intermittent wind and solar electricity power. Of course, this is simply not available from global mineral reserves, but, states Michaux, it is not clear how the buffer could be delivered with an alternative system.

Michaux sounds a clear warning message. Current expectations are that global industrial businesses will replace a complex industrial energy ecosystem that took more than a century to build. It was built with the support of the highest calorifically dense source of energy the world has ever known (oil), in cheap abundant quantities, with easily available credit and seemingly unlimited mineral resources. The replacement, he notes, needs to be done when there is comparatively very expensive energy, a fragile finance system saturated in debt and not enough minerals. Most challenging of all, it has to be done within a few decades. Based on his copious calculations, the author is of the opinion that it will not go fully “as planned”.

Last Sunday, Sir David Attenborough concluded six episodes of pseudoscientific green agitprop Frozen Planet II by demanding that the world embrace Net Zero, “no matter how challenging it may be”. Net Zero is a political command-and-control project, the full horror of which is yet to be inflicted on the general population. Michaux is quite clear what it entails: “What may be required, therefore, is a significant reduction of societal demand for all resources, of all kinds. This implies a very different social contract and a radically different system of governance to what is in place today.”

Of course, a radically different system of government is available in the People’s Republic of China, but here the position on Net Zero is a tad more nuanced. Having lifted about a billion people out of starving poverty in the last 40 years and become the workshop for an increasingly complacent western world – all powered by fossil fuel – the cause does not seem so pressing. Speaking to the Communist Party Congress earlier this week, President Xi Jinping sounded a note of caution and said “prudence” would govern China’s efforts to peak and eventually zero-out carbon emissions. All of this would be in line with the principle of “getting the new before discarding the old”.

Meanwhile, China’s coal production is reported to have reached record levels, while the Congress was told that oil and gas exploration will be expanded as part of measures to ensure “energy security”.

Michaux points out that nearly 85% of world energy comes from fossil fuel. By his calculations, the annual global capacity of non-fossil electrical power will need to quadruple to 37,670.6 TWh. In a recent report for the Global Warming Policy Foundation (GWPF), Professor Michael Kelly estimates that the U.K. electricity grid would have to expand by 2.7 times. This will involve adding capacity at eight times the rate it has been added over the last 30 years. If calculations are made for the need to rewire homes, streets, local substations and powerlines to carry the new capacity, the extra cost will be nearly £1 trillion.

In another recent GWPF paper, the energy writer John Constable warned that the European Green Deal seems all but certain to break Europe’s economic and socio-political power, “rendering it a trivial and incapable backwater, reliant on – and subservient to – superior powers”.

History provides us with many examples of weak, or weakened, tribes being overrun by stronger tribes. In the animal kingdom it is known as natural evolution. A 96-year old ‘national treasure’ preaches we have to pay any price to satisfy the new cult of the green god. Better costed and more rational views are available.


Global Climate Summit Is Heading for a Geopolitical Hurricane

The last time world leaders got together for a climate summit, the backdrop was thoroughly menacing. A pandemic had decimated national budgets. Poor countries were up in arms over the hoarding of Covid-19 vaccines by the same wealthy nations whose fossil fuel consumption did most to warm the planet. Relations between the two largest emitters, the US and China, had devolved into zero sum skirmishes over everything from trade to Taiwan.

Those were the good old days.

As Egypt prepares to stage COP27, the geopolitical context that shapes all international diplomacy has gone from tense to precarious. The war in Ukraine has divided nations over what some saw as a fight between Russian and Western interests, and supercharged an energy crisis that risks shredding COP26’s most concrete achievement: a global consensus to cut down on coal.

As COP26 approached, falling prices for renewable energy seemed to have forced a reckoning for the dirtiest of fossil fuels. The final text of the summit included calls for a “phasedown” of coal power from any plant that doesn’t capture its carbon and an end to “inefficient” subsidies for fossil fuel. A year later, rampant energy price inflation has combined with a protracted energy crunch to revive demand for coal and put subsidies for fuel of any kind back on political agendas.

“COP27 is to be convened while the international community is facing a financial and debt crisis, an energy-prices crisis, a food crisis, and on top of them the climate crises,” says Egyptian Foreign Affairs Minister Sameh Shoukry, who’s also the conference’s president. “In light of the current geopolitical situation, it seems that transition will take longer than anticipated.”

The UK wrapped up its ­hosting duties at COP26 with a claim to have kept alive the Paris Agreement’s goal of capping warming at 1.5C above preindustrial levels. Those gains have now been at best stalled or at worst reversed by the wartime logic brought on by the invasion of Ukraine. Russia’s President Vladimir Putin has turned Europe’s energy spigot into an economic weapon in response to sanctions, and major developed economies faced with suddenly scarce natural gas supplies are racing to open up old coal-fired power stations.

The European Union voted in July to reclassify natural gas — in addition to nuclear power — as a climate-friendly fuel, improving prospects for investment.

The boost to fossil fuels may well prove temporary. The imperative for Europe to end its dependency on imported gas to heat homes and power industries has never been so clear. At the same time, the sheer cost of gas—as high as 10 times pre-crisis levels—should create a ­powerful incentive to look for alternatives, and the cheapest option will often be solar or wind power. US President Joe Biden has passed one of the most significant pieces of climate legislation to date. That will only accelerate on-the-ground growth in renewables, which already outpaces the expansion of power generation as a whole.

Yet it’s far from a given that either the war or the recent U-turn toward fossil fuels will be a blip. Now that Russia is intensifying its war effort with a recently announced mobilization, the race is on to lease or build new liquefied natural gas terminals all around Europe. If the continent with the most geopolitical pride in its climate commitments is backsliding, it doesn’t bode well for progress at Egypt’s Sharm El-Sheikh beach resort.

“There doesn’t need to be any more debate about gas,” Bruno Jean-Richard Itoua, the minister of hydrocarbons of the Republic of Congo, declared in September at an oil and gas conference that included Mauritania, Senegal, Gambia, Guinea-Bissau, and Guinea-Conakry. “We need to start producing as much as we can now.” Other African officials at the event echoed this up-with-­fossil-fuel sentiment.

“A lot of countries now say it is hypocritical” to call for forcing out dirty energy sources, says Bill Hare, chief executive and senior scientist for Climate Analytics, a Berlin-headquartered think-tank. “So you are seeing this really big push to renovate oil and gas projects that have been on the back burner for years in Africa and Australia, far exceeding the level required for the European gas crisis.”

For every renewable producer pressing the case for an accelerated transition, Hare sees a traditional energy company urging investment in a time of crisis. “I have rarely seen such a concerted effort by the oil and gas industry to, in one way or another, push back against the climate agenda,” he says.

Al Gore, the former US vice president and climate activist, warned late last month, that it was essential for governments to avoid signing long-term contracts for fossil fuels in a rush to plug short-term gaps caused by Russia’s war. Subsidies that support fossil fuel use doubled from 2020’s Covid-induced low, to 2021, and continue to rise sharply this year, according to a September report from the Organization for Economic Cooperation and Development, an inter-governmental think tank in Paris.

There are other thorny issues that will be discussed at this year's climate summit, the first to be hosted by an African country in six years. Egypt is planning to focus this year’s COP meeting on how developing nations can get funding to adapt to rising temperatures and finance the transition to green energy. It’s also prioritizing loss and damage, a term for compensation for nations that did little to release greenhouse gases but are on the front lines of its effects.

Money to help less-developed nations mitigate and adapt to the impacts of climate change is still missing. Rich countries had agreed to provide $100 billion annually by 2020 and have fallen short by billions of dollars, pushing the target back to 2023. The Egyptian hosts are contending with inflation that spiked to 15% at the end of September from 5.9% at the start of the year. The national budget is being consumed by the need to provide basic food necessities, widening the current-account deficit in the first three months of this year by more than half, to ­$5.8 billion.

Shoukry wants COP27 to agree on additional sums to be transferred from rich to poor nations after 2025. The latest estimates to finance developing nations’ climate goals are in the scale of $6 trillion through 2030, according to the OECD. But with rich and poor economies alike grappling with rising inflation, falling revenue, and often political upheaval, finding that kind of money looks more difficult by the day. Shoukry acknowledged those concerns and called on governments to rise to the financial challenge, as they did during the pandemic.

Preliminary meetings held earlier this year in Bonn to discuss technical issues ahead of COP27 already saw flare-ups between the rich and poor camps, in particular over loss and damage. Those tensions are likely to be in evidence again at Sharm El-Sheikh.

“Rich nations have exploited and reaped the economic benefits of fossil fuels for decades,” says Gabriel Obiang Lima, Equatorial Guinea’s oil minister, describing calls on Africa to hold back on using hydrocarbons as simply unfair. “Now is our time to develop and monetize our resources, and developed countries should understand.”


Australia's collapsing electricity system

Climate catastrophists are very keen to talk about tipping points. So let me steal their thunder and talk about the tipping point of the National Electricity Market (NEM) that connects five states and the ACT.

We were given a preview of the potential for collapse earlier this year when the Australian Energy Market Operator (AEMO) suspended the market and took control as a last resort. Don’t think for a minute that this exercise was costless. There was an ex-post settling up with the companies ordered to provide power, adding several hundred million dollars to the escalating electricity bill that is then divvied up between households and businesses.

It’s worth pointing out here the ineptitude of AEMO. Most of us thought its leadership couldn’t get any worse than the now replaced American lawyer, Audrey Zibelman. (She left to join Google). But the current chief executive, Daniel Westerman, is even more committed to decarbonisation than Audrey, who at least placed a great deal of store on keeping the lights on.

Note here that there is a very small pool of potential candidates for this job – virtually all of them are big supporters of renewable energy. Because the states effectively own the NEM, they decide who gets the job. In other words, any reservation that the Coalition minister, Angus Taylor, might have had about this appointment would have made little difference.

The totally unbelievable modelling that AEMO puts out – see the latest Integrated System Plan – is a classic case of garbage in-garbage out. The assumptions ensure that there is no problem with the electricity grid quickly transforming to being almost totally reliant on renewable energy. In particular, heroic (and convenient) guesses are made about the average capacity factors of wind and solar – much higher than actual data from overseas – as well as the likelihood of lengthy periods in which wind and solar won’t work at all.

But when it comes to grid management, it’s not just about averages but also about catering for the tails of distributions – unlikely events but with potentially serious consequences. A grid cannot be deemed robust unless it is able to provide reliable power in these circumstances.

The alternative approach that AEMO uses is to hope these unusual events won’t occur but, in any case, some new affordable technology will miraculously emerge that should eliminate any problems. The more cautious approach to ensure continuous power is to insist that firming capacity is available on a 1:1 ratio – that is, enough firming capacity to fully stand in place of renewable energy for potentially lengthy periods. Needless to say, this redundancy makes the system very expensive, which is one of the reasons why higher electricity prices are inevitable.

Absent a capacity mechanism – the states won’t agree – and the ongoing early exit of 24/7 coal-fired plants, the NEM is becoming extraordinarily fragile. Where once it was extremely uncommon for AEMO to intervene in the daily operations of the grid, it is now a frequent occurrence. Further pressure will be felt with the closure of the Liddell coal-fired plant next year – at its peak, it had a capacity of 2000 megawatts.

Just three years later, the coal-fired and largest power plant in Australia, Origin Energy’s Eraring plant, is expected to close. Its current capacity is close to 3000 MW and supplies a quarter of New South Wales’ electricity demand. (It’s likely that the NSW government will have to step in to ensure that this plant continues to operate, in a deal akin to the secret arrangement that the Victorian government has with Energy Australia in respect of the Yallourn plant.)

The extremely badly run AGL Energy, egged on by major shareholder, Mike Cannon-Brookes (who holds just over 11 per cent of the registry), has announced that it will shut its coal-fired plant in Victoria – Loy Yang A – ten years earlier than expected, in 2035. This plant has a capacity of over 2000 MW, which is 30 per cent of Victoria’s demand. Not only is this plant relatively new but it also runs off brown coal for which there is no export potential. What this means is that a relatively low-cost input is guaranteed for this plant.

The broader point to be made is that the hastened exit of coal from the NEM – I haven’t mentioned that Queensland expects to be out of coal-fired generation by 2035 – should be ringing serious alarm bells right now. But if anything, the federal Climate Change and Energy Minister, Chris Bowen, seems to regard these developments as good news. After all, he keeps telling us about the importance of emissions reduction and the government’s legislated targets.

What he seems to be blissfully unaware of is the sheer impossibility of replacing coal-fired generation with alternative affordable and reliable sources within the necessary timeframe – if ever. He talks about the need for 10,000 additional kilometres of transmission lines. But given the need to obtain necessary easements (often in the face of strenuous local objections) and the shortage of workers and materials, that ain’t going to happen any time soon.

Even the rollout of renewable energy projects, including the growing popularity of the much more expensive offshore wind turbines, is likely to be slow notwithstanding the substantial subsidies that are on offer.

The decision by the states to essentially go their own ways by devising their own energy plans is further undermining any integrity the planning of the NEM may have had. It’s easy to see that, in the event of blackouts and power rationing, it will be each state for itself, with interconnectors possibly disabled.

The chief executive of one of the big energy operators, Alinta Energy, has belled the cat on what is going to happen with electricity prices. After rising by around 25 per cent this year, the expectation is that they will rise a further 35 per cent next year – figures endorsed by the Australian Energy Regulator. He points out that a coal-fired plant that cost his company $1 billion will need $8 billion in replacement expenditure on renewable installations and the necessary supports.

Of course, we can kiss goodbye to the $275 cut to the annual household electricity bill promised by our ‘I stand by the modelling’ Prime Minister, Anthony Albanese. But that loss may prove small beer in the future scheme of things.