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Only Five Years Left to Make Transition to Low-Carbon Infrastructure

The Nicholas Institute for Environmental Policy Solutions at Duke University

The infrastructure built over the next five years could “lock in” enough emissions to push the world past its target for limiting warming to 2 degrees Celsius, according to the International Energy Agency’s (IEA) latest annual update of energy trends, World Energy Outlook.

The Agency is “increasingly pessimistic” about the prospect for dealing with climate change, said deputy executive director Richard Jones.

To stay below 2 degrees Celsius of warming, the world has a budget of greenhouse gases it can emit, equal to about 1 trillion tons of CO2. Infrastructure already in place, or in the process of being built, will emit about 80 percent of that, the IEA estimated.

Unless there is a binding international agreement soon to ensure a swift transition to low-carbon infrastructure, “the door to 2 degrees will be closed forever,” said IEA Chief Economist Fatih Birol. So, investment in cleantech can’t wait until economic good times, argued the Guardian’s Damian Carrington.

This transition away from fossil fuels will require that annual subsidies for renewable energy continue rising, reaching $250 billion by 2035—four times today’s level—the IEA estimated, but this would still be considerably less than today’s fossil fuel subsidies.

The IEA foresees oil prices remaining high for decades to come, with a tight market with risks of price spikes if there is a cut-off due to war or soaring prices if there is insufficient investment in oil fields.

Because of these climate and security risks, Birol argued, “We have to leave oil before it leaves us.”

Solar Trade War?

The boom in Chinese production of low-cost solar panels has hit U.S. manufacturers hard, making it difficult for them to compete.

Subsidies for renewable energy in China have sparked accusations of a trade war with the United States, prompting a U.S. Department of Commerce investigation.

Some U.S. manufacturers launched an official complaint against China, and have called for a duty on Chinese panels imported into the U.S.

Another group of U.S. solar manufacturers and installers banded together to form the Coalition for Affordable Solar Energy to oppose the complaint. This led China’s largest solar power plant developer to shelve plans for a $500 million U.S. project.

Despite China’s large exports of solar panels, they’re also using many at home—and may install as much solar capacity as the U.S. this year.

Carbon Tax Approved

Australia will impose a large tax on carbon emissions, after the country’s Senate passed the legislation. The tax will kick in next July, and the country is pursuing linking its carbon market with others in New Zealand and Europe.

The system will be tax-and-dividend in which households will be compensated for higher energy prices, with payments of about 10 Australian dollars per week scheduled to start in May, before the tax hits.

Pipeline Controversy

The proposed Keystone XL pipeline to carry tar sands from Canada to Texas faced its biggest opposition yet with a revival of protests in Washington, D.C., in which thousands of protesters encircled the White House.

Canada is also considering another tar sands pipeline called Northern Gateway to reach a port on the Pacific coast, sited for export to Asia.

Oil historian Daniel Yergin argued opposition to the Keystone XL pipeline is misguided because if the U.S. doesn’t buy the fuel, China will.

Either way, the large store of tar sands in Canada could reshape world oil markets, said the Organization of Petroleum Exporting Countries (OPEC), which represents large exporters such as Saudi Arabia, but does not include Canada.

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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Big Businesses’ Call for Climate Action: Strong Treaty, More Aid

The Nicholas Institute for Environmental Policy Solutions at Duke University

A group of 285 large investors, representing more than $20 trillion in assets, urged world governments to forge a binding treaty at upcoming climate negotiations in Durban, South Africa, and said global spending has not been nearly enough to keep warming below 2 degrees Celsius.

The call came from a coalition of four green investment groups—representing the investment arms of banks HSBC and BNP Paribas, as well as of fashion company Hermes and the United Nations Environment Programme—aimed at limiting emissions and taxing them, arguing it will drive innovation, attract investment and create jobs. The call also hailed Australia’s recent move toward a carbon tax, saying it will be a boon for investors.

Meanwhile, another group of more than 175 companies called for Durban attendees to ensure $100 billion in annual climate aid to poor nations, as had been promised earlier.

No Big Bang

But Jos Delbeke, director general for climate action at the European Commission believes the long-running negotiations through the United Nations Framework Convention on Climate Change are unlikely to produce a “big bang”—that is, a breakthrough that would lead to the birth of a new climate treaty.

In preparation for the upcoming meeting, Japan has signaled it may step back from its own target of cutting CO2 emissions 25 percent by 2020—and it is bringing it up now to avoid giving the “wrong message to the international community,” according to the Wall Street Journal.

Japan, Canada and Russia have said they won’t accept an extension of the Kyoto Protocol unless it binds all major economies—which is not the case under Kyoto—but other governments are seeking a way to extend the treaty even without those three countries.

Yomiuri Shimbun also reported Japan will argue the next legally binding climate agreement should wait until 2015, after the Kyoto Protocol lapses in 2012.

Door Closing

Meanwhile, International Energy Agency Chief Economist Fatih Birol gave a sneak preview of the upcoming World Energy Outlook report, which will argue that without bold action, “the door may be closing” on limiting warming to 2 degrees Celsius. Meeting the challenge will take about $38 trillion in spending on oil, gas and electricity infrastructure over the next 25 years.

According to a leaked version of the European Union’s Energy Roadmap 2050, in most scenarios—with differing amounts of efficiency, renewable energy and nuclear power—electricity prices will rise until about 2030, and then fall.

Already the high cost of energy is eating into consumers’ disposable income in the U.S., as well as in the U.K., where it is driving inflation up.

As a counter-measure, the U.K. is pursuing “serious intervention” in the energy market to increase competition and transparency, and the country’s Department of Energy and Climate Change hopes a new bill that came into effect on home energy efficiency will help fight rising bills.

Mixed Signals

A New York Times article asked “Where Did Global Warming Go?,” noting the topic has faded from Obama’s speeches and arguing the GOP has made climate change skepticism a requirement for electability.

However, Joseph Romm at Climate Progress pointed a finger at the New York Times and other major media outlets as part of the problem because there has been a major decline in the amount of climate coverage. Others, such as William Y. Brown of the Brookings Institution argued the New York Times piece is wrong to say Americans don’t trust scientists; rather they don’t like being lectured.

Green issues do appeal to voters, according to a study by Stanford University researchers, who found American politicians who took a pro-green stance were more likely to win. More specifically, Democrats who supported green issues won more often, and Republicans who took anti-green stances lost more often than if they kept silent on the topic.

Energy will also be a significant issue for GOP candidates, according to “energy and environment insiders” polled by the National Journal. Especially important, the insiders said, will be linking energy policy with job creation.

Luxury in a Smaller Package

Even in these hard economic times, luxury cars still have a market and automakers are rolling out new models that, while remaining plush and pricey, are shrinking, both in body and engine.

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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Australia’s Wild Weather May Have Helped Push Carbon Tax

The Nicholas Institute for Environmental Policy Solutions at Duke University

Although Australia’s Prime Minister Julia Gillard had promised before to not enact a carbon tax, floods, bush fires, heat waves, and drought reawakened discussion about putting a price on greenhouse gas emissions.

This week, Australia’s House of Representatives narrowly passed a carbon tax, sending the bill to the country’s Senate, where observers say it is almost certain to pass. Supporters say Australia’s setup would have several advantages over Europe’s carbon-trading system, including a fixed price for the first three years while the fledgling system gets going, which could allow Australia to claim it is the world leader on climate legislation.

However, Australia is currently one of the biggest emitters per capita, with 80 percent of the country’s electricity coming from coal. Australia is also the world’s biggest coal exporter, and as such has the coal industry reacting fiercely to the proposed law.

Buying Sunshine

Debt-wracked Greece is launching a plan—with Germany’s help—to attempt to boost its economy out of recession by building huge solar power installations. “Project Helios,” named after the Greek god of the sun, is designed to attract 20 billion euros in foreign investment—and a large portion of the electricity produced may leave the country, headed to Germany.

However, the plan for exporting the electricity has some snags, critics say—including the need for billions of euros of investment in Greece’s power grid. Nonetheless, the president of the Hellenic Association of Photovoltaic Companies said the plan is more realistic than Desertec, a proposal to supply Europe with electricity from huge solar power farms in North Africa.

Energy for All

In preparation for 2012—which the United Nations has named the Year of Sustainable Energy for All—the International Energy Agency released its first assessment of the cost of ending energy poverty. The price tag: $48 billion a year—about 3 percent of the yearly global energy investment, and about five times as much as is spent now trying to bring energy to the world’s poor.

Expanding electricity to about 1.5 billion people who lack it now would add less than 1 percent to the world’s emissions, the report estimated, and the spread could be driven by the private sector, with the proper incentives from governments, said U.N. Secretary-General Ban Ki-moon.

Pipeline Proceedings

The proposed Keystone XL pipeline, which would carry diluted tar sands from Canada to Texas, faced raucous opposition at a public hearing in Washington, D.C. Protests against the project outside the White House dwindled in September, but the project remains a political headache for the Obama Administration.

Nonetheless, many industry insiders surveyed by National Journal, as well as Canada’s natural resources minister, said the administration is likely to approve the pipeline.

More Nuclear Zones

Notwithstanding the retreat from nuclear power in Germany, Switzerland, and perhaps Japan, the world is still headed for a nuclear renaissance, said a report by Britain’s Royal Society. However, the report argued there should be more emphasis on controlling proliferation of nuclear materials and better storage of spent fuel to avoid accidents like that at Fukushima.

A new bill in Berkeley, California, is questioning the city’s long-time stance as a “nuclear free zone,” which uses no nuclear power and lets no nuclear weapons pass through it. But one of  its city council members says the 1986 law causes more problems than it is worth and should be repealed.

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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Tar Sands Pipeline Gets Green Light in Environmental Review

The Nicholas Institute for Environmental Policy Solutions at Duke University

Hundreds of protesters—including famed climate researcher James Hansen—have been arrested in protests in front of the White House over the past two weeks, in an attempt to stop the construction of a pipeline from Canada to Texas to carry diluted tar sands to Gulf Coast refineries, mainly over concerns about greenhouse gas emissions and risks of tainting a nearby water aquifer.

The U.S. State Department has been weighing whether to approve the pipeline, and under what conditions. In a major step last week, the State Department published its final environmental review, which said the pipeline would have “no significant impact to most resources” along its path, assuming “normal operation.”

U.S. Secretary of Energy Steven Chu said energy security concerns could help the pipeline win approval on the grounds that importing oil from Canada is preferable to imports from the Middle East—an argument echoed in a Washington Post editorial by veteran business reporter Robert Samuelson.

Shale Gas Shakedown

The Marcellus shale deposits—so far, the biggest site for hydraulic fracturing, or fracking— may contain far less gas than recently projected by the U.S. Energy Information Administration (EIA), according to a new assessment by the U.S. Geological Survey.

Although the new estimate is higher than the U.S. Geological Survey’s own 2002 estimate, it is much lower than an estimate EIA published earlier this year. In response, the EIA said it will downgrade their next estimate—perhaps by as much as 80 percent. But the Washington Post reports there may be more to these numbers.

In light of allegations that petroleum companies have overstated how much gas they could get out of shale deposits, the New York State Attorney’s Office is investigating whether companies “overbooked” reserves. Earlier this summer, federal lawmakers called on the Securities and Exchange Commission, the EIA and the Government Accountability Office to investigate industry estimates.

Rise and Fall of Solar, Wind

China achieved a meteoric rise in wind power over the past five years, and last year pulled ahead of the U.S. to become the country with the largest installed capacity of wind turbines.

At the same time, the growth of China’s wind industry is slowing down due to over capacity and withdrawal of subsidies, among other causes. And some of China’s largest wind turbine manufacturers reported falling profits due to fierce competition, as has been seen in the solar panel industry.

Solar manufacturers in the U.S. and Europe have been struggling to compete with panels from Asia, China especially. Two weeks ago, Evergreen declared bankruptcy, followed by Solyndra this week. Both companies had been touted by the Obama administration and local officials as models for the green economy. New York-based SpectraWatt, a solar spin-out from computer chip manufacturer Intel, also filed for bankruptcy.

Meanwhile, China is pushing ahead with plans to greatly expand their installations of solar power, doubling their targeted installations over the next decade. By 2015, they aim to have 3 gigawatts installed—10 times as much as they had last year—and by 2020, 50 gigawatts.

Despite such difficulties in the market, the United States’ net exports of solar power products more than doubled in 2010 compared with the year before, reaching $1.8 billion. Total U.S. exports of solar products rose 83 percent, to $5.6 billion, in part because Asia is importing equipment for manufacturing solar panels.

Burying the Problem

The first industrial-scale carbon capture and storage (CCS) plant in the U.S. broke ground in Illinois, with the aim of capturing emissions from a large corn ethanol plant. Work on the plant began just after a U.S. utility canceled its plan for CCS on a West Virginia coal plant.

In Canada, a CCS plant for capturing emissions from tar sands processing may move ahead after Canada’s government recently agreed to underwrite two-thirds of the $1.35-billion project’s cost.

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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Welcome to The Climate Post

NI logoEveryone suffers from time-poverty, these days. Many areas of expertise have become deeply entwined with other disciplines and professions, even as we all have less time to explore them. That’s particularly true in climate change, where politics, business, Earth and life sciences, policy, and culture are all interdependent – yet no one can keep up on everything.

People close to energy-and-climate work in the U.S. Congress might not have time to read about new businesses that are bringing clean technologies to market, or a controversial article in a science journal, or events in far-flung corners of the world. People working on clean-tech start-ups might not have time to keep track of Congress. Readers interested in but not knowledgeable about energy-and-climate issues might get to just one or two articles a week on a subject outside their immediate spheres. The Web offers us boundless information, but limited context.

That’s why the Nicholas Institute for Environmental Policy Solutions at Duke University is pleased to introduce The Climate Post, a weekly (for starters) narrative overview of news, trends, and events that shape the evolving climate mosaic. The Institute is an independent center charged with identifying and helping remove “sticking points” to progress in addressing our many environmental challenges.

The limits of media are a sticking point to dealing with climate change. Even before the wheels came off the traditional media, on average, climate coverage has been lacking in centralization and comprehensiveness. The Climate Post is our drop in the bucket, a way to make sense of what’s reported and how, what isn’t reported, and how the vast sweep of politics, policy, science, business, and culture all vie for our attention on the “story of the century.” We’re here to try and blend many stories into a single weekly narrative – delivered to you each Thursday afternoon at 3 p.m..

The Climate Post
Thursday, May 14, 2009

This week’s climate headlines are reminiscent of an old joke that touted “newspaper headlines the day after nuclear war.”

The New York Times: “Nuclear War, Third World Hit Hardest.”

The Wall Street Journal: “Nuclear War, Effect on Markets Uncertain.”

The Boston Globe: “Tip O’Neill Safe After Nuclear Blast.”

USA Today: “We’re Dead! Full AFC-NFC Box Scores, p. 11.”

You can tell it’s an old joke because concern about “newspapers” and “nuclear war” is very 20th century. Yet when you track this week’s headlines as climate legislation makes its way through the U.S. House, it’s clear not much has changed.

This morning’s Times and yesterday’s Washington Post headlines about the situation emphasize a near-deal among previously sparring Democrats. The Journal eyes new potential breaks for the auto industry and utilities in the bill. The Globe stays local, and writes that a national plan would supplant Massachusetts’ participation in a Northeast climate program.

The USA Today ran an Associated Press story on its Web site, and last week printed an article with the headline, “Celebs use star power to spotlight pet causes; Environmental issues rate high on activist actors’ list.” (The paper reports that Prince Charles, Harrison Ford, Robin Williams and Pele teamed for a MySpace.com video about rainforests.)

Here’s our snapshot, this week: Waxman and his co-sponsor, Rep. Ed Markey (D-MA), are pressing the House Energy and Commerce Committee to pass their American Clean Energy and Security Act of 2009. The bill would set a nationwide “cap” on greenhouse gas emissions – a limit – that would decline over time, as well as set a Renewable Electricity Standard. After two weeks of hearings in April and intense back-door negotiations with Committee members and their constituents back home, signs of a deal have begun to leak out. We should see a revised version of the bill, called the Manager’s Amendment, within the next few days.

Meanwhile, down Pennsylvania Avenue, the administration in recent weeks has issued new guidelines for biofuels (enflaming parts of industry), set in motion potential EPA regulations of carbon emissions from tailpipes, and backed a Bush administration decision on the inadequacy of the Endangered Species Act to address climate change indirectly, through the declining habitat for polar bears. [See this for biofuels and this for polar bears.]

These headlines have dominated in the Washington environmental world – but just as Americans are not the only people fighting information overload and time-poverty, Washington is not the only capital struggling with climate issues this week:
Citing the recession, Australian Prime Minister Kevin Rudd put off plans to create a national market for industrial firms seeking to buy or sell credits to emit greenhouse gases. His government’s proposal had failed to garner support among environmentalists, who saw the targets as too thin, and industry, which hopes for more concessions.

This conversation plays out against a background of increasing concern about the effects of climate change already being witnessed down-under. The Economist reported this week that the volume of water reaching the Murray River in South Australia is lower than any other time in 117 years. The article is bluntly titled, “In need of a miracle.”

Local capitals are getting in on the action, too. Voters in British Columbia went to the polls and re-elected the Liberal party, giving a vote of confidence in the province’s carbon tax – the first law of its kind in North America. In the U.S., Michigan Gov. Jennifer Granholm, a Democrat, has supported measures that would encourage the development of clean technology. Observers partially credit (or blame) her influence and new laws on Mid-Michigan Energy’s recent scuttling of a coal-fired power plant in Midland. But job-starved regions of the state welcome the work that would come from plant construction – and several remain in the pipeline. An energy company in Washington state pulled plans for a $1.5 billion coal-fired power plant, because it has no way of capturing the emissions.

A paper local to former President George W. Bush’s ranch, the Waco Tribune-Herald, editorialized today, “Dismiss talk of global warming and environmentalism if you must. But these times are changing fast and, along with them, the very way we heat and cool our homes and businesses.” That’s just one take in a state simultaneously encouraging its potential for solar energy while elected representatives to Washington fight the Waxman-Markey bill. When the Bushes visit family in Maine, they’ll encounter a new law in Kennebunkport that prevents cars and trucks from idling at banks, fast food restaurants, and at the beach (The Secret Service probably has pull).

Legislation and rules, scientific predictions and industry product lines are shaping the international response to global warming on a daily basis. We’ll bring you highlights weekly. A thousand words now and then can provide a pretty good picture. See you next week.