Green Bonds giving green projects & renewables a push forward

On the side-lines of the Paris climate change conference, Climate Bonds and UNEP Inquiry have launched on 9 December “Scaling Green Bond Markets – Guide for the Public Sector.” On 24 November, Barclay Bank’s CEO for Asia Pacific Andrew Jones, talked about his bank’s commitment to Green Bonds and driving investment in low carbon technologies and projects globally. He was speaking at a forum on low carbon investing organised by the European Union delegation and hosted by Barclays in Singapore. Read More

‘Scaling Green Bond Markets – Guide for the Public Sector’

Paris, 9 December 2015 – Climate Bonds and UNEP Inquiry have tonight launched Scaling Green Bond Markets – Guide for the Public Sector during a COP21 Side Event at Shearman & Sterling Paris office.

The Guide is the result of a partnership between the Climate Bonds Initiative and the UNEP Inquiry into the Design of a Sustainable Financial System and contains range of specific actions for policy makers in both developed and developing economies.

Accompanying Scaling Green Bond Markets – Guide for the Public Sector is an Annex from the World Bank Group as an additional resource for policymakers in emerging economies to assist them in foundational bond market development.

The Guide contains three broad categories of recommendations on green bond development for public sector policy makers.

Fundamental actions: establishing a green project pipeline; strengthening local bond markets; strategic public green bond issuance and developing green standards.

Proven Support Tools: strategic public green bond investment; credit enhancement; tax incentives and developing instruments to aggregate assets and structure risks.

Innovative Additions: adjusting risk weightings for green investment and preferencing green investments in central bank operations.

Detailed action plans and international best practice examples on how to grow green bond markets are included to assist in policy development. The application and mix for each country will depend on the specific macroeconomic context and policy priorities.

The findings of this report will also feed into a report by the Organisation for Economic Co-operation and Development (OECD) on green bonds, to be launched in 2016, and country-specific policy reports under development by the Climate Bonds Initiative.

Sean Kidney, CEO of the Climate Bonds Initiative, said:

“This guide can help the public sector in translating aspects of their national INDC objectives into climate finance outcomes. Adding green bonds into the climate finance mix can help the shift of capital to low carbon projects, infrastructure and climate resilient development. Credible, robust and liquid green bond markets can only accelerate the investment directions that INDCs in part, require, to meet individual country targets

“There is clear interest amongst policy makers to scale green bond markets. Here at COP21 green bonds are being identified as a potential new source of climate finance for cities, regions and low carbon infrastructure and projects across many sectors.”

Nick Robins, Co-Director of the UNEP Inquiry, said:

“The potential opportunity of the green bond market has caught policy makers’ attention. There are increasingly examples of governments moving from interest to action. China’s central bank has published a range of ambitious policy proposals for green bonds, with official green bond guidelines launching soon. India’s capital markets regulator SEBI just announced green bond guidelines. In the EU, supporting green bond standards is included in Capital Markets Action Plan.”

“At COP21 many discussions have centered around climate finance and the level of investment needed to bring about low carbon outcomes. Green bond market development is seen as a real option. This report can only assist governments, policy makers and ultimately institutional investors in developing sustainable climate finance outcomes.”

About Climate Bonds Initiative: The Climate Bonds Initiative is an investor-focused not-for-profit, promoting large-scale investment in the low-carbon economy. For more information here. A copy of Scaling Green Bond Markets – Guide for the Public Sector is available here.

About UNEP:  The United Nations Environment Programme (UNEP) is the leading global environmental authority that sets the global environmental agenda, promotes the coherent implementation of the environmental dimension of sustainable development within the United Nations system and serves as an authoritative advocate for the global environment.

The Climate and Clean Air Coalition is a voluntary global partnership of governments, intergovernmental organizations, businesses, scientific institutions and civil society committed to catalyzing concrete, substantial action to reduce Short Lived Climate Pollutants (including methane, black carbon and many hydrofluorocarbons). The Coalition has 11 initiatives working to raise awareness, mobilize resources and lead transformative actions in key emitting and cross cutting sectors. SLCP reduction must go hand in hand with deep and persistent cuts to carbon dioxide and other long-lived greenhouse gases if we are to stay under a 2 degrees Celsius warming limit.  The CCAC Secretariat is hosted by the United Nations Environment Programme.

Source: www.climatebonds.net

Barclays reaches £1 billion Green Bonds target

Barclays Investment Bank reports (17 November 2015):

Barclays today confirmed it has reached its target of investing over £1 billion in Green Bonds and has made a commitment to invest a further £1 billion. This represents one of the largest Green Bond investment commitments by any institution globally.

Last year Barclays announced its commitment to investing at least £1 billion by November 2015, as part of its liquid asset buffer.

Green Bonds are fixed income securities designed to raise capital to finance the low carbon environment. Barclays’ Treasury department has expanded its Green Bonds portfolio across various investment grade issuers including the European Investment Bank and KFW.

In 2014 the green bonds market totalled $36.59bn and current issuance for 2015 stands at $29.66bn*

Commenting on this investment, Tushar Morzaria, Group Finance Director, Barclays, said:

“Barclays has undertaken thorough due diligence to establish the social and environmental credentials of the proposed investment portfolio, including engaging with the issuers and also the leading NGO in this area, Climate Bonds Initiative.”

Sean Kidney, CEO of the Climate Bonds Initiative said:

“Addressing the risk of catastrophic climate change requires commitment; Barclays have shown that commitment can be combined with investing that achieves required returns at the same time. They have shown that, when it comes to the green bonds space, green can and does go with good investment. The one billion marker is a celebration of that.”

* Climate Bonds Initiative, October 2015

Source: www.investmentbank.barclays.com/our-insights/Barclays-reaches-green-bond-target.html

Who’s most responsible for CO2 emissions? The producers or consumers of fossil fuels?

“The big emitter of CO2 are the users of petroleum products and the demand is not decreasing despite the economic slowdown in some markets,” says Peter Cockcroft, an independent energy and risk management consultant told Rigzone. an industry publication in a year-end report which includes observations and comments from Professor Michael Quah, director of the National University of Singapore’s Energy Office and Ken Hickson, who says that “a head-in-the sand attitude by the oil industry and, in some cases, outright denial of climate change and what was fuelling it, has finally led to pressure being put on the big producers to mend their ways”. Read more

Consultant: Carbon Dioxide Emission – Don’t Blame Oil, Gas Companies

by  Ranveer Karan in Rigzone (23 December 2015)

Oil and gas producers have not hurt the environment through carbon dioxide (CO2) emissions as much as the processing and transportation industries as well as petroleum products consumers, an industry veteran said.

“The big emitter of CO2 are the users of petroleum products and the demand is not decreasing despite the economic slowdown in some markets,” Peter Cockcroft, an independent energy and risk management consultant who has led a number of oil and gas firms during his 40 years in the energy industry told Rigzone.

“Oil and gas companies are unfairly under regulatory and reputation pressure to reduce both upstream and downstream CO2 emissions. But these companies continue to take a leading role in identifying and implementing energy efficiency programs,” he pointed out.

Cockcroft questioned the lesser pressure on petroleum product consumers who generated around 50 percent of global CO2 emissions and observed the high level of CO2 emitted by plants converting biofuels through “pressured” processes including palm oil refineries.

Upstream Firms Focus on Existing Fields

Meanwhile, the consultant noted efforts made by upstream companies in meeting rising global energy demand through hydrocarbon exploitation despite the drastic decline in oil prices which has adversely impacted their bottomlines.

Cockcroft said oil and gas companies are focusing on maximizing production from existing fields through innovation and cost effective means, adding that wildcat drillings resulting in dry holes have not been reported much these days.

Still, major petroleum firms have slashed upstream capital expenditure by 60 to 70 percent this year because of low oil prices. Meanwhile national oil companies are focusing on marginal and existing fields and continued drilling within proven hydrocarbon basins.

It has become attractive to continue drilling in existing fields as charter rates for jackups have fallen by more than 50 percent, while services companies including seismic surveyors have dropped fees significantly.

Cockcroft sees reserves building in marginal fields through new ideas, technologically-enhanced and cost-effective operations. Technologies would also help develop the previously non-commercial discoveries in shallow waters and onshore basins.

Low oil prices means higher consumption, especially in the transportation sector. He noted that share prices of airline companies have risen on stock exchanges as fuel costs – a key operating component – have fallen in line with the industry downtrend. Comparatively, the oil and gas firms are losing their values with declining share prices on the same bourses.

Yet it is these oil and gas companies that are supporting the global economies by continuing with their exploration and production activities.

Cockcroft said national oil companies have obligations to their governments to keep producing from existing hydrocarbon basins even on smaller profit margins, while supermajors have had to rethink about costs and responsibilities to the shareholders.

Markets are not going to change in any way with oil and gas fed energy to stay on in the coming years and renewables having again lost the advantage of being developed. Natural gas is favored for its pricing and increasing availability.

Cockcroft noted that Japan has switched to environment-friendly natural gas to replace nuclear energy, while more Asian countries are also opting for the more carbon-friendly fossil fuel as imports of liquefied natural gas become cheaper.

Hope for Change in Fossil Fuel Dependence

But there are industry experts holding on to the hope of changing the fossil fuel dominated energy businesses.

“Hydrocarbons have been exploited to satisfy the energy needs of the world, as these were the easiest, therefore the most economical to exploit, ever since we discovered Texas Tea and Black Gold, among others,” according to Professor Michael Quah, director of the National University of Singapore’s Energy Office and an industry watcher, in particular its transition from fossil fuels to a low carbon future.

“For over 1,000 years the world continued to improve upon the machines and systems to utilize these resources. Only recently have we woken up to the ‘externalities’, the carbon burden on the atmosphere,” he pointed out.

“However, breaking our dependence on fossil fuels incurs extra current costs and we have to move to life-cycle analyses,” Dr. Quah explained.

He added that the bankers of the world are reluctant to do that and there’s a resistance to shift to renewable resources, where some countries are blessed with more and other less.”

“We continue to use fossil resources because we cannot simply go cold turkey,” Dr. Quah continued, unless “we wish to suffer rapid withdrawal symptoms”.

The academic explained that energy is so fundamental to human development that the world must accelerate the transition away from fossil fuels at great costs, more so for the lesser developed countries. But Dr. Quah emphasized that “we must not expect an immediate turnaround, as “our species cannot make such U-turns without a deadly whiplash”.

Ken Hickson, head of the consultancy Sustain Ability Showcase Asia (SASA), added there is no time to lose in making the vital switch from fossil fuels to renewable energy.

“Oil, gas and coal companies must have seen the writing on the wall when more than 30 years ago strong scientific evidence started to surface that burning fossil fuels was the primary producer of unacceptable levels of CO2 in the atmosphere,” Hickson, author of “Race for Sustainability” and “The ABC of Carbon”, said.

“A head-in-the sand attitude by the oil industry and, in some cases, outright denial of climate change and what was fuelling it, has finally led to pressure being put on the big producers to mend their ways”, Hickson observed.

He even draws attention to his belief, outlined in his global “Visions 2100” launched in Paris recently, calling for international agreements to shut down all coal mining and coal fired power stations by 2030 and that that major oil companies, including the Middle East oil producers, should invest 80 percent of their profits in renewable energy in 2016.

Despite the recent Climate Change meeting in Paris, developing countries are unlikely to heed the developed world’s call to stop using fossil fuels as current crude oil and petroleum products prices are sufficiently low for them to tap on such fuel sources in developing their national economies, according to industry experts and energy analysts.

Source: www.rigzone.com/news/oil_gas/a/142240/Consultant_Carbon_Dioxide_Emission_Dont_Blame_Oil_Gas_Companies/?all=HG2#sthash.MjslFNKe.dpuf

Last word

People Creating Solutions for the Planet Now and Towards 2100

We have long advocated a creative approach to dealing with climate change and environmental damage. And clearly believe that art and sustainability are compatible bedfellows. We like what we see and read about CLIMARTE, which harnesses the creative power of the Arts to inform, engage and inspire action on climate change. So we pricked up our ears – and eyes – when we read about a Dutch artist who is keen to vacuum up Beijing’s hazardous smog. We also must remind readers to check out – again – the wonderful book called “Visons 2100” – launched in Paris during the climate change conference – in which 80 contributors from around the world – including yours truly – have put their creative and visionary thoughts into print in looking back to the future. Read More

Today newspaper, Singapore (8 December 2015):

Ms Liu Min, an expectant mother in Beijing, is worried about her baby’s future. She gets anxious when she thinks of the youngest lung cancer patient in China, who is only eight years old. Air pollution is definitely on the minds of Beijing citizens, and now it has driven an artist more than 7,000km away to take action.

Dutch designer and architect Daan Roosegaarde has created a seven-metre-tall air-cleaning “Smog-Free Tower” and is ready to ship it to Beijing if he gets the green light from the Mayor’s office, with whom he says he has had five rounds of talks.

His tower works like a huge outdoor air purifier, and Mr Roosegaarde said it can clean 30,000 cubic metres of air an hour. This means that in one-and-a-half days, it could clean the air contained in a typical football stadium.

It works through ionisation technology, similar to how hair sticks to a balloon’s surface. The tower consumes a small amount of power, equal to a home-use water boiler.

Mr Roosegaarde said he has cleaned a park in Rotterdam and is now looking for partners in China to build and install his towers there.

Tiny toxic particles known as PM2.5 can be inhaled into the lungs. Research from Berkeley Earth, a non-profit organisation that conducts scientific investigations on climate change, shows that 1.6 million people die each year of air pollution in China.

Beijing has rolled out various measures, including tax reductions for buying hybrid cars, but the four-day stretch of smog at the beginning of December, the worst of the year, reveals there is still a serious problem. The choking haze is a scourge that residents such as Ms Liu know well.

“I would really like to do it in Beijing first. It is the city that inspired me to do this,” said Mr Roosegaarde, adding that he was convinced after more than two years of trips to the Chinese capital. Now, he faces a new hurdle: The Mayor’s office keeps postponing. “It’s a very sensitive, political topic,” he said.

Mr Roosegaarde said he has been approached by air-conditioner makers too, including household names in China such as Gree Electric Appliances and Broad Group. But he decided to work with public interests first, through the local government and possibly Tsinghua University, which has also shown interest, according to Mr Roosegaarde. “You have to build trust; it’s China,” he said.

The artist first came up with the idea of the Smog-Free Tower while visiting Beijing as a speaker at a design event in 2013.

He runs a studio in the Netherlands that produces design and architecture projects, with contracts and commissions from museums and local governments.

The tower is the first project he started with his own money. In July, he listed the project on Kickstarter with a goal of raising €50,000 (S$76,000) and it ended up raising €113,153 in two months. One of the rewards he offers donors is a ring set with a cube formed from collected smog particles, which are 42 per cent carbon. And if you place “carbon under high pressure, you get a diamond”.

Mr Roosegaarde’s latest goal is to install his towers in 20 to 25 public parks in Beijing. He plans to offer leases to bring down costs. He would like to expand later to other developing nations, such as India, which face similar air-pollution problems.

A BLOOMBERG report.

Source: www.todayonline.com/business/dutch-artist-keen-vacuum-beijings-hazardous-smog