As Eurozone Crisis Deepens, Fight to Save Emissions Trading Scheme Begins

The Nicholas Institute for Environmental Policy Solutions at Duke University

Editor’s Note: The Climate Post will not be circulated next Thursday in observance of the holiday. Look for it again on January 5.

Prices in Europe’s carbon emissions trading scheme have collapsed this year, in part because there were too many allowances in the system starting off, threatening the future of the whole market.

“Without intervention … Europe’s climate policy is over,” one analyst said. Some of Europe’s biggest energy and manufacturing firms also wrote a letter to the European Commission that called for Europe to take “decisive action now” to raise the price of carbon and fix the scheme.

The European Parliament’s environment committee voted in favor of temporarily cutting the number of emissions permits to be issued.

This year, the price of permits has fallen about 50 percent. Emissions allowances are now about 6 euros per ton—a four-year low, and about half what they were when the market began. Denmark, which will take over the presidency of the European Union in 2012, said the current carbon prices are “not sustainable” and vowed to help fix the problem.

Part of the problem is that Europe’s economic crisis is escalating, risking a slump like in the 1930s to which no country will be immune, said Christine Lagarde, managing director of the International Monetary Fund, in a speech at the U.S. State Department. Also, a new energy efficiency effort could also cut the number of permits needed, another reason to issue less in the future.

Paving the Way for De-carbonized Energy

The European Commission presented its long-awaited “Energy Roadmap 2050,” aiming to point the way to meet the European Union (EU) goal of cutting emissions at least 80 percent below 1990 levels by 2050.

The report considered various ways of reaching these targets, and concluded that relying heavily on renewables would be no more expensive than boosting nuclear, or fossil fuels along with carbon capture and storage.

A de-carbonized energy system could be cheaper than “business-as-usual,” although de-carbonization would require large up-front spending. The report also said natural gas will be a “critical” fuel during the transition.

The EU soon needs to set renewable energy targets for 2030, said EU Energy Commissioner Günther Oettinger.

Pollution Crackdowns

The European Union moved earlier this year to expand its emissions trading scheme to include flights in and out of Europe, and now the European Court of Justice has backed that law despite protests from the U.S. and others. The new decision, which goes into effect Jan. 1, may trigger a trade war.

Meanwhile, the U.S. Environmental Protection agency unveiled its first limits on emissions of mercury and several other toxic pollutants from power plants. The limits were 20 years in the making, and cover a variety of toxic compounds including arsenic, nickel, selenium, and cyanide.

The new standard gives companies three options: install systems to scrub their emissions, switch to natural gas, or shut down their plants. Some of the nation’s oldest—and generally dirtiest—coal-fired power plants may be forced to shut down, which could also benefit the climate.

Climategate Investigation Widened

The U.S. Department of Justice is apparently working with law enforcement officials in Britain to investigate who leaked climate researchers’ e-mails.

In the U.K., police raided the home of one climate skeptic blogger and confiscated two of his computers.

Flipping the Switch on Incandescents

A ban on the sale of incandescent light bulbs of 100 watts or more in the U.S. is supposed to go into effect Jan. 1, but an emergency spending agreement in Congress removed funds from enforcement of the ban, at least until October 2012. Experts say the lack of enforcement will likely have little effect, since light bulb manufacturers have already retooled and moved on.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

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Surprise Deal Emerges at United Nations Climate Talks

The Nicholas Institute for Environmental Policy Solutions at Duke University

In a surprise turnaround, the United Nations climate talks managed to produce a new deal to eventually curb global emissions moving forward. In a press release announcing the agreement, the United Nations Framework Convention on Climate Change (UNFCCC) called it a “breakthrough.”

The new agreement marks a break from the Kyoto Protocol, which divided the world into two categories—the developed and the developing world. Instead, said the European Union’s Climate Commissioner Connie Hedegaard, the new agreement reflects “today’s mutually interdependent world,” and moves toward an agreement that partners all countries in combating climate change.

The new agreement—dubbed the “Durban Platform“—created a group with an unwieldy name, the Ad Hoc Working Group on a Durban Platform for Enhanced Action, which has the mandate to develop “a protocol, another legal instrument or an agreed outcome with legal force.” In essence, it is an agreement to finalize an accord no later than 2015, which would go into effect in 2020.

The agreement would also extend the Kyoto Protocol, set to expire at the end of 2012, for an additional five years, allowing the system’s carbon trading to continue. This won’t have much impact on carbon markets or renewable investment in the next few years, analysts told Reuters, but could have an effect over the longer term.

How the Deal Was Done

To forge the deal at the thirteenth hour, the talks were extended nearly two days.

The push for the new agreement reportedly came from developing nations and those likely to be most affected by climate change, which put pressure on the European Union to work for an extension of the Kyoto Protocol.

The bloc of emerging countries known as BASIC—Brazil, South Africa, India and China—was divided, with India the strongest holdout against binding emissions cuts for these countries—at least until richer countries met the targets they’d already committed to.

India was persuaded by an addition in the Durban text of an option of an “outcome with legal force”—although the difference in meaning between that and a protocol or “legal instrument” is not yet clear. The United States’ Special Envoy for Climate Change, Todd Stern, said overall it is “pretty clear that we’re talking about something probably in the nature of a protocol.”

Just after the talks wrapped up, Canada pulled out of Kyoto Protocol, saying it won’t meet the goals it had agreed to for cutting its emissions, bringing condemnation at home and abroad. Nonetheless, UNFCCC Executive Secretary Christiana Figueres said Canada still has a “legal obligation” to cut its emissions.

Landmark or Disaster?

Opinions were divided over the new pact’s significance.

Some called it a “landmark deal,” although many seem to think it is unlikely to keep warming below 2 degrees Celsius, the line the U.N. had drawn for “dangerous climate change.”

A Nature editorial called the outcome “an unqualified disaster” for the climate, and argued politicians can no longer talk “with a straight face” of meeting the 2-degrees-Celsius goal. With India’s agriculture under major threat from further warming, the country’s reluctance to sign a binding climate treaty was “suicidal,” argued Gwynne Dyer.

Persian Gulf Tensions

Meanwhile another deal was being hashed out, among the members of the Organization of Petroleum Exporting Countries (OPEC). They agreed to raise officially allowed production to 30 million barrels a day—but since production is already at that level, the agreement will likely have little effect on oil prices. The compromise came out in Saudi Arabia’s favor, since the country defied other OPEC members earlier this year and unilaterally raised its own production.

Oil markets are “cooling” as the Eurozone crisis has slowed global growth, said the International Energy Agency; nonetheless, the agency warned oil prices are high enough to threaten growth.

Tensions between Iran and the West continued, with some saying a covert war has already begun. An escalation would likely drive oil prices much higher, and the U.S. and European Union are reportedly trying to find ways to apply pressure to Iran that would neither raise oil prices nor hand Iran windfall profits.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Editor’s Note: The Nicholas Institute is transitioning away from sending The Climate Post via Google Feedburner. If you are receiving our new posts Thursday’s at 5 p.m. via Google, please unsubscribe from the feed by clicking the link at the bottom of the e-mail. Forward the e-mail on to nicholasinstitute@duke.edu to re-subscribe using our new service. We apologize for any inconvenience this may cause, and appreciate your interest in our weekly write-ups.

Now All GOP Presidential Candidates Express Climate Skepticism

The Nicholas Institute for Environmental Policy Solutions at Duke University

GOP presidential candidate Jon Huntsman expressed skepticism about the science on climate change, so now all GOP candidates are on the record as doubting either that the planet is clearly warming, or that people are responsible for most of the warming.

Of all the GOP candidates, Huntsman had been the most supportive of action on climate change: in 2007, as governor of Utah, he signed up his state for a cap-and-trade system for greenhouse gas emissions.

There has been an increase in climate skepticism in the past year and a growing reluctance to say anything about climate, especially among Republicans. The turning point—argued the National Journal’s cover story, “Heads in the Sand“—was the 2010 Supreme Court decision that lifted restrictions on campaign spending and boosted so-called super political action committees (super PACs) that can take unlimited funds.

The deniers haven’t won yet, though, argued Bill Chameides of Duke University. Most Americans accept the basics of climate change, more investment went into green energy than fossil fuels in 2010, and some of the biggest energy companies—such as ExxonMobil—affirm that climate change is real.

Little Agreement in Durban

As the United Nations climate negotiations in Durban, South Africa, come near their close, there is little hope of coming to an agreement. The executive director of the International Energy Agency said the lack of progress is a “cause for concern,” and urged countries: “Don’t wait for a global deal. Act now.”

China showed signs of softening its stance on a climate agreement, saying it may “shoulder responsibilities” for cutting emissions, as long as it is not held to the same standards as richer countries—a move an Oxfam climate campaigner called “really encouraging.”

Meanwhile, a new study reported greenhouse emissions from the developing world have surpassed those of the developed world (using the Kyoto Protocol’s definitions for each group)—and it happened much earlier than expected.

The president of the Worldwatch Institute, Robert Engelman, proposed a “shadow climate regime”—an alternative approach that erases divisions between developed and developing countries as well as caps on emissions, and taxes all emissions, regardless of where they originate.

Because of the slow progress on climate treaties, scientists have been looking increasingly at geoengineering—global schemes for cooling the planet—and a collaboration  between Britain’s Royal Society and two other groups called for more research into these methods.

Nuclear Decline, Stormy Rise of Renewables

The world’s nuclear power dropped in 2011, as plants were knocked out by Japan’s tsunami, shut down, or those under construction canceled or postponed. The International Energy Agency (IEA), in its recent World Energy Outlook, detailed how the world might get by in a scenario with declining nuclear power, but said meeting the climate change targets under discussion at Durban would require “heroic achievements in the deployment of emerging low-carbon technologies,” in particular for countries like Japan.

China’s wind and solar capacity will soar in the next decade, adding the equivalent of 180 nuclear power plants, the IEA forecast.

The growth of China’s solar industry has been a source of contention with America, leading the U.S. International Trade Commission (ITC) to launch an investigation into China’s support for its solar industry. The ruling said U.S. companies had been harmed by China’s policies, but China’s Commerce Ministry argued the reaction smacks of protectionism. The ITC voted to continue its investigation.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Editor’s Note: The Nicholas Institute is transitioning away from sending The Climate Post via Google Feedburner. If you are receiving our new posts Thursday’s at 5 p.m. via Google, please unsubscribe from the feed by clicking the link at the bottom of the e-mail. Forward the e-mail on to nicholasinstitute@duke.edu to re-subscribe using our new service. We apologize for any inconvenience this may cause, and appreciate your interest in our weekly write-ups.

Pleas, Hard Lines, and Accusations of Bad Faith Negotiations at Climate Talks

The Nicholas Institute for Environmental Policy Solutions at Duke University

In Durban, South Africa, the latest round of United Nations climate negotiations opened with a plea from South Africa’s president, Jacob Zuma, for countries to look beyond national interests. So far, however, the talks have been marked by many of the same divisions that plagued earlier meets.

A coalition of environmental groups—including the Natural Resources Defense Council and the Union of Concerned Scientists—accused the U.S. of negotiating in bad faith. At the conference, the United States, Saudi Arabia and Venezuela stalled on decisions about a Green Climate Fund to pay for clean energy and climate change adaptation in poorer countries.

In response, the European Union (EU) urged a conclusion on the fund, and took the hardest stance it ever has in such negotiations, insisting on stiff conditions for China and developing countries and demanding a road map for moving forward.

Meanwhile, Canada’s environment minister called the country’s decision to sign on to the Kyoto Protocol “one of the biggest blunders” an earlier administration made since they had no intention of meeting the pledge. This led a group of African leaders to plead Canada to reconsider.

Climategate 2.0

A week before the climate talks began, a new collection of 5,000 e-mails from climate researchers surfaced, apparently part of the same set obtained and then leaked in 2009 in the so-called “Climategate” affair. Despite widespread accusations of bias and manipulation of data, the researchers involved were cleared of wrongdoing.

But the new release of the second batch of e-mails led U.S. Rep. Ed Markey to state: “This is clearly an attempt to sabotage the international climate talks for a second time.” Markey called for more intense investigation into how the e-mails were hacked. While U.K. police investigated the apparent crime before, a Freedom of Information Act request revealed the police spent little on this effort.

To try and get clues of who may have been responsible, the Guardian reached out to readers to help troll through the files and uncovered an encrypted file apparently created by the hacker.

Emissions Warning

The latest Greenhouse Gas Bulletin from the World Meteorological Organization recorded an unusually large increase in the CO2 level in the air in 2010—a jump of 2.3 parts per million over the year, compared with the average over the preceding decade of 2.0 parts per million each year.

If this trend continued for the rest of the century, the world would warm some 6 degrees Celsius, warned Fatih Birol, the chief economist of the International Energy Agency (IEA).

However, this forecast is at odds with other warnings the IEA has made, argued Chris Nelder of SmartPlanet—in particular, Birol’s warning that the world has reached the peak of conventional crude oil production, and that high oil prices are hampering economic growth.

Threat of “Oil Armageddon”

Oil-importing countries continued to feel the bite of high oil prices; nonetheless, this year renewable energy spending passed a milestone, topping investment for fossil power plants.

Oil prices may spike again, many analysts warned, after France urged many countries to halt Iranian oil imports, and the U.S., Britain and Canada teamed up to apply new sanctions against Iran over its nuclear program.

However, the EU, poised to overtake the U.S. as the world’s biggest oil importer, can’t afford to refuse Iranian oil, the Wall Street Journal argued. Likewise, the U.S. had been considering sanctions, CNN reported, but hesitated because of the toll an oil price spike would likely have on the global economy. With relations between Iran and the West quickly worsening, Reuters reports oil consuming nations, hedge funds and refineries are preparing for an “oil armageddon.”

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.