Australia Losing Investment Opportunities in Clean Tech

Australia might have the best technology and scientists in the world, but the joint managing director of Arkx Investment Management, Tim Buckley, says the Australian market is the worst for clean energy stocks. We need a price on carbon.” This and more in a full report on the clean tech market from David Potts in the Sydney Morning Herald.

David Potts in Sydney Morning Herald (6 September 2010):

Renewables seem to be on the nose yet there are many reasons why adding them to a portfolio is a good strategy, writes David Potts.

Since the Copenhagen climate change fiasco triggered a sequence of events that deposed Kevin Rudd and led to wherever we are now, green-chip share prices have slumped.

Some of the smallest green chips are debt-free, profitable and paying dividends yet have been punished the most.

Sustainability is what they’re about, except, apparently, for their share prices.

Green chips had a brief rally in July when the Australian CleanTech Index climbed 7.5 per cent, compared with the the ASX200′s 4.1 per cent, but it’s been downhill since even though the only clear-cut message from the recent poll is that the Greens will control the senate.

Not to mention the fact that both sides support the renewable energy target for 2020.

By then the power companies must be supplying 20 per cent of their electricity output from renewable energy sources such as wind farms and solar panels.

With share prices of green chips near their lowest in three years is that a bargain or what? More what I’m afraid or, rather, watt.

The biggest and most promising green chip, despite its former life as a satellite of the collapsed Babcock & Brown, wind farm operator Infigen has reported a loss.

The US, where it has its biggest operation, wasn’t windy enough.

It’s an ill wind that doesn’t blow.

There was also less wind than usual in the west and South Australia, which, mimicking El Nino, was more than made up for where I live.

But the wind not blowing or the sun not shining seem to be the least of the problems of renewable energy stocks. They will remain a more expensive and less reliable form of energy than coal or gas until there’s a tax on carbon or some form of emissions trading scheme.

Even so, the market seems to be overlooking the critical fact that from January 1 the renewable energy targets for power generators progressively increase and, as a handy chart in Infigen’s result presentation shows, they will have to buy large-scale renewable energy certificates (LRECs) to make the target. And guess who’s selling them? Infigen and all the other wind, solar and hydro producers.

Infigen predicts LRECs will come into their own from 2014. The big electricity retailers will need to more than treble their holdings by 2020 and “only a few will build to meet their needs.”

So it’s no surprise that Infigen – despite a high debt load, which it’s running down and making a loss – features high on the list of green chips worth having.

It even pays a 2¢ a year dividend and has a $227 million cash balance.

Like most renewable energy stocks Infigen isn’t trading much higher than its low point of 53¢ a share.

“This isn’t a bad time at all to be buying these stocks,” says the managing director of Ethinvest, Trevor Thomas. Ethinvest is Australia’s oldest financial planning company specialising in green chips.

“They don’t build unless they have a supply contract so there aren’t development risks and technology is improving all the time,” he says.

Ethinvest recommendations are tailor-made but some stocks keep recurring, including Infigen and its rival Origin, which has both solar and wind farms.

But top of the list is Sims Metal. “It’s the largest recycler,” Thomas says. “It does what BHP does except uranium and oil, making it a good proxy for the resources sector.”

Another is CBD Energy, “a great little company.” It has a foot in just about every renewable camp: wind, solar and storage using a graphite battery.

The stock has very low gearing, has just moved into profit and the two brokers following it value it at 30¢ or 40¢, more than twice its current price. But, like all fast-growing stocks, it is capital hungry: there have been two raisings so far this year.

AGL, with both wind and solar farms, is also a well-regarded green chip that has outperformed the sharemarket during the past 10 years.

One of the smaller stocks Ethinvest favours is solar panel and pump supplier Solco, which has just posted its third consecutive and so far biggest profit, is debt-free as well as paying a tiny dividend.

The other is Dyesol, which is also debt free but loses money. It’s the only solar energy company that doesn’t need much sun to generate electricity. It has adapted photosynthesis from the plant world and using its special dye can generate power more cheaply than traditional silicon-based solar cells, working in low light and not even having to face the sun.

Although Sydney-based Arkx Investment Management is loath to invest in Australia until a carbon tax is put in place, some green chips are on its watch list including Infigen, Dyesol and CBD Energy.

Another is Geodynamics, which plans to use hot rocks in the Cooper Basin to generate power. But it’s strictly long term – we’re talking 2019 at the earliest.

“It has breakthrough technology but it’s yet to be proven,” says the joint managing director of Arkx, Tim Buckley.

Others are Carnegie Wave Energy, using one of the two world-leading ocean wave technologies (“the question in our view is what is the generating and capital cost to bring it online”) and Ceramic Fuel Cells, which has a unit the size of a dishwasher that generates electricity on site from natural gas and has “a client list of who’s who of world utilities”.

Dollars help the planet

It has to be clean, green and keen for veteran fund manger Laurence Freedman — who these days runs his charitable Freedman Foundation — to put his money into it. Oh and debt free.

One of his biggest forays is into Phoslock, which has a product that prevents toxic algae by turning phosphate pollutants in water into mud that drops to the bottom.

“I’ve been using it in my fish pond for five years and the three carp, Huey, Dewey and Louie, are getting fatter,” he says.

“The problem is not the product but dealing with government water authorities,” although it has already made sales in Europe.

Another stock he likes is AERIS Environmental, which has an environmentally friendly way of removing bacteria and mould that builds up in airconditioning and cold storage systems.

Lately he has taken a shine to Nanosonics, a stock that is about as clean as you can get.

It has invented a disinfectant machine, or transducer, that cleans surgical instruments, replacing the more expensive steam-pressurised or chemical-using autoclaves usually employed.

Freedman says you need a portfolio of stocks for green investing. Suitable stocks should have some cash on hand or at least some large shareholders who can be tapped for future finance.

And “nibble away” rather than put your money in all at once.

“Dollar-cost average so you’re putting money in slowly,” he says.

“My final advice is don’t look at the price every week.”

Ethical investment is a moral minefield

An ethical fund has thrashed its mainstream rivals in the past year, posting a 29.5 per cent return, three times better than the overall share market, according to Morningstar.

While it’s reassuring that investing with a conscience doesn’t have to be a mug’s game, there’s a fine line between what’s ethical and what’s mainstream.

The Perpetual Wholesale Ethical SRI Fund eschews alcohol, gambling and tobacco stocks but was the best performer because it has a big holding in the banks.

Which just goes to show that ethics are in the eye of the beholder.

A bank might tick all the boxes for its relations with staff and shareholders or efforts at promoting renewable energy — Westpac has won awards for being Australia’s most socially responsible company — but you don’t know to whom it has been lending.

And what about uranium mining? Nuclear power might be clean and green but many consider uranium mining to be one of the most unethical activities of all.

Perpetual’s ethical fund, for example, leaves out BHP Billiton, which owns the world’s biggest uranium mine.

The problem for ethical funds is that having excluded many stocks from what is a relatively small and certainly not diversified market, they have to pile more into what’s left.

That’s why ethical funds are also a victim of market cycles, such as a run in bank stocks or a mining boom, if not more so.

By the same token, if you feel good about them at least there’s comfort in knowing you’re not being silly with your money.

During the past three years both types lost about the same amount — about 6.5 per cent annually — if that’s any consolation.

The fact is a deeply green fund has to look offshore for stocks.

One fund is so frustrated by the lack of progress on achieving a price for carbon that it has invested its whole portfolio on offshore green chips — and reaped the results.

“Australia has the best technology and scientists in the world. We’d love to invest in Australian clean tech stocks,” the joint managing director of Arkx Investment Management, Tim Buckley, says.”The Australian sharemarket as a whole is the best performer globally but the worst for clean energy stocks. We need a price on carbon.”

The wholesale Arkx Clean Energy Fund returned 20 per cent last financial year.

Keep an eye on its website at arkx.com as the partly Westpac-owned investment manager is planning a fund for mum and dad investors.

Source: www.smh.com.au

Lucky Last  - Going from Hippie to Hip!

Editor of Green magazine Tamsin O’Neill talks with Michael Short in The Zone for The Age (6 September 2010):

Magazine editor and environmentalist Tamsin O’Neill is on a crusade – but not telling people what to think. She is as much educator as editor. The co-founder and editorial chief of green magazine manages to combine poise and passion as she uses her TV interview in The Zone to promulgate a case for radical change in something as fundamental to our lives as the very way we create and use our homes.

Sustainability has gone from hippie to hip. The magazine Green has been both a cause and an effect.

“Right from the beginning, our aim was to make sustainability sexy.” That aesthetic and intellectual allure is not limited to architecture. Quite a chunk of the publication is devoted to design.” Read More

Has the Great Australian Dream been sullied by a Great Australian Delusion?

Have we, understandably but unwittingly, undermined the value and potential pleasure of home ownership by making the classical error of putting quantity ahead of quality?

Have we, at a suburban level at least, already become victims, rather than lucky-country beneficiaries, of the belief that bigger is better?

Are the multitudes of McMansions, as they have become known, spreading daily around Australia’s major and satellite cities, a mistake we are making en masse?

Tamsin O’Neill is as much educator as editor. The co-founder and editorial chief of green magazine manages to combine poise and passion as she uses her TV interview in The Zone to promulgate a case for radical change in something as fundamental to our lives as the very way we create and use our homes.

It comes from the core. She was raised in a family of architects who grew their own vegetables, had chooks  and a house in the bush. O’Neill’s love of the environment and of architecture are natural partners. That marriage has given birth to ideas that have found a seductive, instructive voice through green.

So, here’s the case, or part thereof, against those McMansions that are enveloping our urban fringes in a  ceramic patchwork quilt: “The problem with these big houses is not just the scale of them but the amount of energy they use and the amount of waste that goes into landfill while they’re being built and the longevity of them,” says the former photographer.

“A lot of it is about status and the idea that bigger is better is something I would really like to see change … helping (people) who want to own a big house to understand that maybe they can have a house that’s not as big but is just as conformable and you could probably fit two houses on a block that they’ve got their house on and still be incredibly comfortable and save money on energy and save money overall.”

So, a foundation of O’Neill’s argument is that better quality and structural longevity is actually going to save the home builder money. A typical example is a recent story on the cover of the magazine: “Thinking small – a minimalist house on a city river”, about an innovative building in Brisbane.

Another cornerstone is that she is not elitist – although she is fully aware she might be misunderstood.

On the contrary, it’s about connection and community – even meaning. It’s almost, really, about back-to-basics and the elegance of simplicity.

“I do find it very sad to drive through some suburbs and not see any children in the street, and I think that we have lost that kind of openness and connectedness to the street and to your neighbours [that] is such an important thing.

“Houses need to be designed to facilitate that, but also, on the other end of the scale, I do see there’s a real resurgence in community activities, such as farmers’ markets. People are getting out there and engaging with the local community. I see a lot of that. We’ve got a bit of both happening.

“I’m hoping this is a trend, that this will spread, this idea that for your soul you really need to communicate with your neighbours and your community and, to have a fuller life, that’s a really important thing.”

Life has been full for O’Neill, who, with husband Tom Bodycomb, set up green despite initially thinking suggestions she launch a magazine were ridiculous.

But some people have activism in their genes. Combine that with an entrepreneurial itch, a hole in the market and a partner who shares your vision and you have a propitious constellation of circumstances. The conception of green magazine was immaculate; its birth, well … laboured.

“There are so many magazines. It’s crazy. Why would you start a magazine? We all know how difficult it is to sustain a magazine. But there came a point where the whole green thing was really gathering momentum and I have a mentor who suggested to me one day that there wasn’t enough information out there for people who wanted to build houses environmentally, and that was it.”

Launched in mid 2007 as a quarterly, it is now a bi-monthly magazine of about 120 pages, as well as a website. Circulation has reached 25,000 copies, with an estimated readership of more than 100,000.

Start-ups are trying, but the family survived – and now thrives. Probably has something to do with the children banning their parents from talking business at the dinner table. And with the separate offices they use. Skype can help, it seems, maintain partnerships that are at once personal and professional.

“The first year was very hard. Lots of very early mornings and very late nights, and at that point Tom was working full-time on another job, and so the computer and a cup of tea came into the bed at five o’clock in the morning.

“We did a lot of work before the kids got up. And then he did a lot of work at night. So, it was very difficult time. Probably the most difficult thing I’ve done.”

It might have been a struggle to create, but the magazine’s future appears blessed, given the now-mainstream desire to live in a more harmonious way with the environment.

Sustainability has gone from hippie to hip. green has been both a cause and an effect.

“Right from the beginning, our aim was to make sustainability sexy.” That aesthetic and intellectual allure is not limited to architecture. Quite a chunk of the publication is devoted to design.

“It’s the clever stuff that I love. People doing amazing things with recycled materials that are very beautiful.

“Our upfront section is a showcase of product design, and that in particular is an amazing resource for people for designing products around a recycled whatever – old plates and cups and old brooms – anything that sits around doing nothing and there are too many of. Finding solutions for that type of rubbish that look great and are stylish.”

But some rubbish is beyond redemption. And here, too, O’Neill really wants to provoke and lead change. She’s not only declared death to McMansions. It’s death to “crap furniture”, too.\

And here, again, it might sound like she’s trying to impose or proscribe. But she’s not, she’s seeking to inspire – and to save us some money and the planet some resources.

Now, before all those IKEA fans out there get offended, O’Neill’s definition of “crap furniture” does NOT include that operation.

“IKEA furniture is not that bad and I think if you pick and chose carefully you can buy things that will last a bit longer and then you can take them to the op shop and people will probably buy them and they’ll get used again, which is a great thing. I’m all into second-hand furniture – I love it.”

What she hates is the waste caused by cheap and nasty furniture that’s not designed to last.

“You go into an op shop these days and it’s just absolutely overflowing with furniture that’s kind of half-broken and really not very usable. And that is fundamentally the problem.

“Years and years ago, everybody saved up to buy a nice dining room table or some nice chairs. That really is fundamentally what sustainability is about.

“If people went out and spent more on a table and some nice chairs that would last them a lot longer, they wouldn’t have to go out and buy them again.

“And they wouldn’t end up in op shops, and they wouldn’t end up in landfill.”

As we contemplate all the public policy issues associated with population growth – as well as our housing affordability issues – it’s the private choices opened up to us by people such as Tamsin O’Neill upon which we might construct not only a more sustainable future, but a happier one.

Source: www.theage.com.au

What’s in the wind?

Or the sun for that matter. Australia’s Government is still in a state of flux, though it is looking increasingly likely that the Labor Party’s deal with the Greens will be enough to enable it to form Government, with a little help from at least two independents. Hopefully it will mean a carbon price will come sooner than later. Lord Nicholas Stern was in Australia saying, among other things, how economically important such a move would be.  We look at what’s not happening to make our coal fired power stations cleaner, as well as hear what the Clean Energy Council and the Green Building Council have to say. Russia is starting to address its emissions, Argentina has an algae solution for bio fuel and Canada is turning to waste to energy. What’s the deal for the UNFCCC, with or without Rajendra Pachauri? The Asia Development Bank is banking on Clean Energy Bonds and the Victorian Government gets a Green Star. Holden makes a green car move and, believe it or not, skeptics are for turning! Look out for Sustain Ability Showcase Asia, Climate Alliance Australia & Earth Charter Festival.  Environmental leadership is coming to business, with a little help from friends and the Environmental Defense Fund. – Ken Hickson

Profile: Lord Nicholas Stern

Lord Nicholas Stern, the leading climate economist, author of the widely respected 2006 Stern Review and adviser to the British government, says Australia is well placed to benefit from a carbon price. He told the National Press Club in Canberra this week it didn’t matter if it was a tax or a trading scheme – the revenue could be used to fund new technologies or contribute to a new $100 billion a year UN climate change fund.

Sky Channel ran the complete speech from the National Press Club and summed up his talk in this way:

The move came on the same day as Lord Stern told the National Press Club it didn’t matter if it was a tax or a trading scheme – the revenue could be used to fund new technologies or contribute to a new $100 billion a year UN climate change fund.

‘You could do very well indeed,’ he said.

‘You have to take a 10 or 15 year view of this, you have to make investments, this doesn’t come for free in the short-run, the price of electricity will go up.’

While Lord Stern had ‘thoughtful, reflective’ talks with independents Rob Oakeshott and Tony Windsor on Tuesday, he would not comment on Australia’s political predicament.

He laughed off independent Bob Katter’s assessment of him as a ‘lightweight’, saying he was certain the north Queensland MP was a ‘splendid fellow’.

Source: www.skynews.com.au

Tom Arup in Sydney Morning Herald (2 September 2010):

ONE of the world’s leading climate change experts, Sir Nicholas Stern, has warned countries such as Australia will face future trade barriers unless it moves to a low-carbon economy.

In a speech to the National Press Club yesterday, Lord Stern said the world should embrace what he called the ”new industrial revolution” of cleaner technologies and renewable energy.

”Not participating in this new industrial revolution runs two types of risk: you drop behind technologically and you risk, not tomorrow or the next day but 10 or so years from now, finding real difficulty in the trade story,” he said. ”Ten or 15 years from now, those that produce in dirty ways are likely to face trade barriers.”

Lord Stern said while he had spent his career arguing against protectionism, trade barriers against countries that did not reduce their emissions were ”right”, although he hoped it would not come to that.

Lord Stern is a strong supporter of a carbon price and the author of the 2006 Stern Review, which articulated the economic case for action on climate change. He is in Australia on a personal trip but has taken time out to meet with major political players, including the independent MPs Rob Oakeshott and Tony Windsor, who will decide who forms the next government.

Lord Stern would not reveal details of his conversation with the two MPs yesterday except to say they were ”very thoughtful, reflective and well-informed people, thinking very seriously about the problems of the future”.

Lord Stern’s visit comes as Terry Tamminen, the climate adviser to the Californian Governor, Arnold Schwarzenegger, is in Melbourne to address a business conference.

Mr Tamminen told the Sydney Morning Herald he was also meeting Victorian government officials about Mr Schwarzenegger’s proposed R20 climate group, which aims to bring together regional governments from America, Asia, Africa and Europe.

One of the group’s aims is to develop a global emissions trading scheme at a state government level, which could also connect into the European Union’s emissions trading scheme.

Details of the R20 will be launched at a Global Climate Summit in November along with a ”green bank,” backed by the United Nations Development Program, to help participating governments fund low carbon development.

Mr Tamminen said Australia should look to California, which is regarded as a leader in renewable energy industries, as an example of how acting on climate change is good for the economy.

Lord  Stern toured a carbon capture and storage (CCS) institute in Canberra, according to an AAP report.

The author of the influential Stern review for the British government, which examined the cost of climate change inaction, Lord Stern visited the Global CCS Institute on Tuesday.

He is a member of the international advisory panel for the institute, which was launched last year and receives $100 million annual federal government funding to accelerate the technology.

Before his Australian visit, Lord Stern said he looked forward to learning the institute’s progress on CCS, which if proven viable, would capture and store carbon dioxide, reducing emissions from power plants to almost zero.

“We need to begin to overcome as many of the barriers to the technology as quickly as possible,” he said in a statement.

Source: www.smh.com.au

One of the world’s leading economists, Lord Stern was the author of a seminal review for the British Government into the cost of climate action and inaction.
The Stern Review was a major turning point in the worldwide climate change debate, and influenced Australia’s own Garnaut review, by highlighting the importance of a carbon price, climate finance, adaptation policy and international agreement.
Lord Stern is the IP Patel Professor of the London School of Economics, chair of LSE’s new climate change research institute (the Grantham Institute), and member of a high level advisory board to the UN on climate finance.
Lord Stern is a former chief economist for the World Bank, has held high level positions in the British Government’s economic service and Treasury and taught at universities in the UK, France and India.

Lord Stern has been Chair of the Grantham Research Institute since it was founded in 2008.

He also holds the following positions:

• Chair of the Centre for Climate Change Economics and Policy; 
• IG Patel Professor of Economics and Government, the first holder of this position, at the Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD);
• Chair of the Asia Research Centre;
• Director of the India Observatory.

Background

Lord Stern was adviser to the UK Government on the Economics of Climate Change and Development from 2005-2007, where he was Head of the Stern Review on the Economics of Climate Change, published in 2006.

He was Head of the Government Economic Service from 2003-2007; Second Permanent Secretary to Her Majesty’s Treasury from 2003-2005; Director of Policy and Research for the Prime Minister’s Commission for Africa from 2004-2005; and Chief Economist and Senior Vice President at the World Bank from 2000-2003.

During his time as Chief Economist of the European Bank for Reconstruction and Development, and Visiting Professor of Economics at LSE, he was one of the founding forces behind the Asia Research Centre, formally becoming its director in 2007.

Research interests

• The economics of climate change;
• Economic development and growth;
• Economic theory;
• Tax reform;
• Public policy;
• The role of the state and economies in transition.
•  

Source: www.lse.ac.uk

Is Bob Katter the Mad Hatter on Climate?

Clean Energy Council Chief Executive Matthew Warren urges Federal independent MPs to back whichever party will deliver a carbon price as soon as possible and provide the optimal conditions for investment in renewable energy, as there was a rare opportunity to negotiate a win for their electorates, regional Australia and the environment. Even though key independent Bob Katter says he did not bother to attend briefings on offer by prominent economists Ross Garnaut and Nicholas Stern because they are “lightweights”.

31 August 2010

By online political correspondent Emma Rodgers, ABC News 1 September 2010:

Key independent MP Bob Katter says he did not bother to attend briefings on offer by prominent economists Ross Garnaut and Nicholas Stern because they are “lightweights”.

In outspoken comments on ABC Radio this morning, Mr Katter also branded climate change scientists as “stupid” and said he was within a “hair’s breadth” of deciding which party to throw his support behind.

Mr Katter and his fellow independents are attending dozens of meetings with department officials and ministers this week before deciding which party they will support to form a minority government.

Ross Garnaut authored the Government’s climate change review, which formed the basis of its emissions trading scheme, and Sir Nicholas Stern released a landmark 2006 report for the British government on the impact of climate change on the economy.

Crossbenchers Robb Oakeshott and Tony Windsor met the pair yesterday but Mr Katter says he skipped the meetings.

“I think their positions are fairly lightweight,” he told AM.

“I’ve heard their viewpoint many times, and I simply disagree with them dramatically.

“Just to indicate how stupid those people are, there is a very unassailable scientific case that there will be a problem arising in the oceans. They don’t mention that.”

The three independents will today meet with heads of several departments before spending the afternoon with Treasury and Finance secretaries Ken Henry and David Tune.

Eleven days have now passed since the election, with neither major party yet able to secure a 76-seat majority.

Mr Katter says he is within a “hair’s breadth” of making a decision but Mr Oakeshott and Mr Windsor have warned that a final resolution will still take some time.

Mr Windsor says the trio are working through the process they set up last week.

“I know everyone wants a quick result but the poll hasn’t been declared yet,” he said.

“Even if we made a decision today there wouldn’t be a government formed for some weeks.”

Mr Oakeshott says draft formal agreements are “bouncing around” but it is still “early days”.

The fourth independent from Tasmania, Andrew Wilkie, has received an offer from Prime Minister Julia Gillard but is yet to make up his mind.

Newly elected Greens MP Adam Bandt is more than likely to support a Gillard led-government.

Source: www.abc.net.au

Independents crucial to breaking climate change deadlock

Australia’s clean energy industry urges Federal Independent MPs to back whichever party will deliver a carbon price as soon as possible and provide the optimal conditions for investment in renewable energy.

Clean Energy Council Chief Executive Matthew Warren said the independents had a rare opportunity to negotiate a win for their electorates, regional Australia and the environment.

The Clean Energy Council has welcomed positive comments by Independent MPs on climate change policy, particularly those made by the member for New England Tony Windsor who described an emissions trading scheme as an opportunity for the bush, rather than a problem.

Mr Windsor told media yesterday that climate change policy has been the ‘elephant in the room’ throughout the campaign. All four independents have also supported more investment in renewable energy.

“An emissions trading scheme is widely recognised as being the most efficient way of reducing emissions across the country,” Mr Warren said, “It is a policy that has been supported by Professor Ross Garnaut, Former Prime Minister John Howard, former Coalition Leader Malcolm Turnbull, the National Farmers Federation, the Greens and the Labor Party.

“This is about risk management. We have to stop speculating about the validity of climate science and see this issue for what it is: an insurance policy for our future.”

Mr Warren said it was crucial there were no major changes to the Gillard Government’s renewable energy target, increased investment in the grid and emerging technologies and a clear pathway to a price on greenhouse emissions.

“Most new jobs and more than $20 billion of new investment in clean energy will be located in regional and rural Australia,” he said.

Northern NSW and Queensland are well placed to expand clean energy generation using bioenergy and large scale solar, along with other clean sources of electricity such as wind, wave and geothermal.

“Renewable energy is great news for country Australia,” he said. “It will create growth, greater economic diversity and help drought-proof farms and regions.”

Source: www.cleanenergycouncil.org.au

Govern with the Greens? But How to Make Coal Cleaner

Acting Prime Minister Julia Gillard has dumped her election promise to deliver a citizens assembly to debate climate change and a carbon price, under a formal deal with the Greens to support a Labor government to set up a parliamentary committee with expert advice from outside. Meanwhile Labor’s promised emissions standards for new coal electricity generators would not cut greenhouse gas emissions from any of the 12 coal power plants proposed in Australia, an analysis by Greenpeace shows.

The Australian (1 September 2010):

JULIA Gillard has dumped her election promise to deliver a citizens assembly to debate climate change and a carbon price under today’s formal deal with the Greens to support a Labor government.

The lampooned policy, which was condemned by the Coalition and the Greens at the last election as nothing more than a talkfest, has been replaced by mutual agreement with the Greens by a parliamentary committee.

But no agreement has been reached on a timeframe for a carbon price, which the Greens and Labor agree is vital to meet greenhouse gas emission reduction targets by 2020.

The Greens this morning struck a formal deal with Labor to govern but the fate of Australia’s next prime minister still lies with the independents.

“The Greens will ensure supply and oppose any motions of no-confidence in the government from other parties or MPs,” leader Bob Brown said at a media conference in Canberra a short time ago.

“Labor will work with the Greens to deliver improved transparency and integrity to parliament.”

The Greens-ALP deal includes the climate change committee to consider a price on carbon, immediate reform to political donations, a full parliamentary debate on Afghanistan, a leaders debate commission and agreement on a private members’ bill to debate above-the-line voting.

When parliament is sitting, the prime minister will meet Senator Brown and their lone lower house MP Adam Bandt each week, and fortnightly when not sitting.

The deal does not include a cabinet position for a Green. Senator Brown said this was because his was primarily a Senate-based party and “our job here is to form government as expeditiously as possible and that meant we had to be a little bit modest”.

And there is no agreement from Labor to set a carbon price, with The agreement also did not include a conscience vote on same-sex marriage because the parties could not agree.

Senator Brown denied the Greens had put that their carbon price demand on hold in order to ensure the trio of key country independents could reach an agreement with Labor to deliver goverment.

He said the proposed climate change committee would be ready to go by the end of the month, describing it as an amalgam of Greens and Labor policy.

Asked if the committee meant Julia Gillard’s much-derided citizens assembly on climate had been scrapped, Senator Brown said: “That’s a question for the Prime Minister.”

The Greens’ decision to back Labor effectively lifts the ALP’s numbers in the hung parliament from 72 to 73 seats – a dead heat with Coalition’s.

The Liberal and National tally of 73 seats includes WA National Tony Crook, who has indicated his intention to sit on the cross benches with the independents.

Senator Brown said he had spoken with Tony Abbott last night “and he said he would attack any agreement we are working on and I said that was his right”.

“We have made a decision here,” Senator Brown said.

The Greens leader said if Mr Abbott ultimately became prime minister he would hold talks with him to discuss how the new Senate would work.

Senator Brown said he hoped there was a Gillard government “by this time next week” because he did not think the Greens could work with Mr Abbott.

Senator Brown said the Greens had spoken to the three independents Bob Katter, Tony Windsor and Rob Oakeshott, who today revealed that their decision on which side of politics to support could take as long as until next Tuesday.

Julia Gillard, Wayne Swan, Greens leader Bob Brown, deputy Christine Milne and lower house MP Adam Bandt met this morning to formally sign off on the agreement.

Source: www.theaustralian.com.au

Tom Arup, Environment correspondent, Sydney Morning Herald (31 August 2010):

LABOR’S promised emissions standards for new coal electricity generators would not cut greenhouse gas emissions from any of the 12 coal power plants proposed in Australia, an analysis of the carbon profiles of each project shows.

During the election campaign, Labor promised to impose new mandatory standards, with a starting point of 0.86 tonnes of carbon dioxide per megawatt hour, on all new coal plants.

The promise would also require new coal plants to be carbon capture and storage ”ready”. But the standards – which would start next year – would not apply to projects that have already had regulatory approval.

The Prime Minister, Julia Gillard, has repeatedly said the standards would ensure ”no more dirty coal-fired power stations” in Australia.

But an analysis by Greenpeace shows that none of the 12 proposed coal plants would be forced into a redesign or be shelved due to the standards.

The figures show just three of the proposed plants would emit more carbon per megawatt hour of electricity generated than would be allowed under Labor’s promised standards.

The proposed Bluewaters 3 and Bluewaters 4 coal plants in Western Australia both have emissions intensity rates of 0.92, and the proposed Coolimba plant in WA will have a rate of 0.9 to 1.0. All three have state government approval and would be exempt from federal Labor’s standards.

The emissions intensity for a new coal generator in South Australia – Altona Energy’s Arckaringa plant, which is in an early stage of development – remains unknown. Calls to Altona Energy’s Australian office went unanswered yesterday.

A proposed brown coal plant in Victoria with emissions standards of between 0.78 and 0.87 was recently withdrawn for redesign to meet a tougher 0.8 standard set by the Victorian government as part of its climate change white paper.

The other seven new plants all have estimated emissions intensity rates below Labor’s 0.86 standard. The lowest is the 0.18 at the Wandoan carbon capture project in Queensland.

Source: www.smh.com.au

Russia Gets UN Approval for a Major Emissions Reduction Project

Russia submitted for registration its first carbon emissions reduction project under a special United Nations procedure, a step that can signal “a substantial increase” of followers, says the UN regulator. The joint implementation project is located at the Shaturskaya Thermal Power Plant near Moscow.

By Ewa Krukowska for Bloomberg News (31 August 2010):

Russia submitted for registration its first carbon emissions reduction project under a special United Nations procedure, a step that can signal “a substantial increase” of followers, the UN regulator said today.

The joint implementation project, created under a UN Kyoto Protocol mechanism, will be located at the Shaturskaya Thermal Power Plant near Moscow, the UN Framework Convention on Climate Change said in a statement from Bonn today. The so-called JI projects generate tradeable emissions-reductions units that countries can use to meet their obligations to cut greenhouse gases under the UN climate-protection treaty.

“This is a much anticipated and very welcome development,” Christiana Figueres, executive secretary of the UNFCCC, said in the statement. “It’s another clear sign that JI has an important role to play in directing investment to emission reduction in industrialized countries.”

The Russian project assumes building an additional electricity generation unit using an energy-efficient combined cycle gas turbine, the UNFCCC said. It’s one of 15 joint implementation projects approved by the Russian government at the end of July and its registration will be deemed final after 45 days if it passes the UN-supervised scrutiny.

The project is the first in Russia under the Track 2 procedure, where the verification of emission reductions is supervised by the Joint Implementation Supervisory Committee. Under Track 1, the verification procedures and the issuance of emission-reduction units are left up to the host country.

‘Extremely Positive’

There are now 234 Track 2 projects in the pipeline and 177 Track 1 projects registered, accounting for potential reductions of about 500 million metric tons of CO2 equivalent by the end of 2012, according to the UNFCCC.

“This is an extremely positive first step, considering that Russia is the country with the largest potential for JI,” said Benoit Leguet, the JISC chairman. “The carbon community has been waiting for this for four years, since the JISC launched the Track 2. We also need to look to the future, and to the essential role of JI Track 2 in the post-2012 world.”

The Kyoto Protocol expires at the end of 2012, and climate- change envoys worldwide are bracing for the next round of negotiations on a new climate-protection framework. The talks are due to start toward the end of November in Cancun, Mexico.

Source: www.bloomberg.com

IPCC is “Successful Overall” But Needs Operational Overhaul

An international review panel this week called on the UN global climate change body to carry out fundamental reforms after embarrassing errors in a landmark report dented its credibility. The Intergovernmental Panel on Climate Change (IPCC) was caught in an international storm after its landmark 2007 report was challenged. The five-month probe ordered by UN Secretary General Ban Ki-moon said the IPPC was “successful overall” but needed a stronger scientific basis for making its predictions and recommended an overhaul of the position of IPCC chairman Rajendra Pachauri.

AFP report in The Age (30 August 2010):

An international review panel on Monday called on the UN global climate change body to carry out fundamental reforms after embarrassing errors in a landmark report dented its credibility.

The Nobel Peace Prize-winning Intergovernmental Panel on Climate Change (IPCC) was caught in an international storm after it admitted its landmark 2007 report exaggerated the speed at which Himalayas glaciers were melting.

The review panel said the IPCC has been “successful overall” but called for leadership changes, stricter guidelines on source material and a check on conflicts of interest.

The five-month probe ordered by UN Secretary General Ban Ki-moon said the IPCC should have a stronger scientific basis for making its predictions and recommended an overhaul of the position of IPCC chairman Rajendra Pachauri.

The InterAcademy Council, which groups 15 leading science academies, was brought in after an uproar over the IPCC’s 2007 study, which highlighted evidence that climate change was already hurting the planet.

In the run-up to a climate summit in Copenhagen in 2009, the IPCC was rocked by a scandal involving leaked emails which critics say showed that they skewed data.

The mistake over the Himalayan glaciers — a claim which was found to be sourced to a magazine article — and an earlier error over how much of the Netherlands is below sea level also tainted the IPCC’s image.

“I think the errors made did dent the credibility of the process — there’s no question about it,” said Harold Shapiro, a former president of Princeton University who led the review.

“Trust is something you have to earn every year,” he told reporters. “We think what we recommended will help.”

The IPCC has admitted its mistakes but insisted its core conclusions about climate change are sound.

The review said the glacier reference showed the IPCC did not pay close enough attention to dissenting viewpoints.

“There were a number of reviewers who pointed out that this didn’t seem quite right to them and that just was not followed through,” Shapiro said.

The UN review said guidelines on source material for the IPCC were “too vague” and called for specific language, and enforcement, on what types of literature are unacceptable.

The review called for a new chief executive to run the IPCC and for the chairmanship to become a part-time post with a new holder for each landmark study carried out.

Pachauri, an Indian scientist primarily employed by the TERI think-tank, has come under criticism, with some arguing he had a vested interest due to his business dealings with carbon trading companies. He has strongly denied any conflict of interest however.

Pachauri told a press conference after the report that he would let member-states decide his future. The 194 nation IPCC is to hold a general meeting in Busan, South Korea in October.

The IPCC chairman criticized what he called “ideologically driven posturing” in the attacks on the climate group, which shared the 2007 Nobel Peace Prize with former US vice president Al Gore.

Ban said the review had in no way weakened the strength of basic climate science but he said nations had to act on the recommendations.

“Given the gravity of the climate challenge, the secretary general believes it is vital that the world receives the best possible climate assessments through an IPCC that operates at the highest levels of professionalism, objectivity, responsiveness and transparency,” his spokesman said in a statement.

In Brussels, European Climate Action Commissioner Connie Hedegaard also said that “after all the fights” the main findings of the 2007 report are “still unchallenged.”

“The bottom line, and this report says it, is that overall the IPCC has done a very good job, but there were some minor errors and they were corrected,” she told AFP.

Environmental group Greenpeace pointed to severe weather this year — including Pakistan’s flood disaster and Russia’s worst-ever heat wave — as new evidence of global warming.

“Despite the muckraking and crude attempts to undermine the findings of the IPCC, the scientific consensus is clear, climate change represents a serious threat to the future of the environment and humanity,” Greenpeace said.

Source: www.news.theage.com.au

First Australian Made Holdens to Run on Bio-ethanol

Holden has unveiled its latest Commodore range, which could eventually be powered by household waste. Both V6 and V8 models in the VE Series II Commodore line-up have been designed as the first Australian-made vehicles to run on bio-ethanol as well as conventional petrol. Bio-ethanol, also known as E85, is a cleaner burning fuel capable of cutting carbon dioxide emissions by up to 40%.

By Tim Dornin  for AAP in The Australian (31 August 2010): 

HOLDEN has unveiled its latest Commodore range, which could eventually be powered by household waste.

Both V6 and V8 models in the VE Series II Commodore line-up have been designed as the first Australian-made vehicles to run on bio-ethanol as well as conventional petrol.

Bio-ethanol, also known as E85, is a cleaner burning fuel capable of cutting carbon dioxide emissions by up to 40 per cent.

It is produced from the by-products created during the processing of wheat, sugar and sorghum. The ethanol is then blended with 15 per cent petrol.

But Holden is also investigating the viability of establishing Australia’s first ethanol plant that would produce the fuel from household and other waste.

Holden chairman and managing director Mike Devereux said the introduction of the E85 flex-fuel technology was part of the company’s commitment to leading the push towards alternative fuels.

“We have placed an enormous emphasis on developing technology that can be used in today’s vehicles to make driving better for the environment,” he said.

“That has included leading the way for Australian produced cars with bio-ethanol, providing motorists with a cleaner fuel alternative when filling up their car.

“It is the first major step forward in our efforts to move renewable fuels like bio-ethanol from a niche product into the mainstream by making it available on Australia’s top selling car line.”

Fuel retailer Caltex will start selling the E-Flex high-ethanol blended fuel at 31 outlets in Sydney, Melbourne, Adelaide, Brisbane and Canberra from October.

That number will rise to 100 in 2011, including some regional sites.

Holden’s energy and environment director Richard Marshall said the company believed bio-ethanol had a big future in Australia.

“It is a cleaner-burning, renewable fuel and long term we think it has the ability to displace up to 30 per cent of Australia’s petrol use,” he said.

Holden has introduced other changes with the VE Series II models, including revised styling for the front fascia, grille and headlamps.

The new car also gets a state-of-the-art system to integrate music, satellite navigation and phone functions into one unit.

The Holden iQ system uses a new full-colour LCD touch screen mounted in the centre dash which the company benchmarked against high-end multimedia products.

Music can be played direct from an iPod, memory stick or other USB device through dedicated sockets while the system also has the capacity to rip and store up to 15 compact discs on an internal drive.

Mr Devereux said the changes to the Commodore range reflected Holden’s focus on continuous improvement.

“Our approach to Commodore has been about making a great car even better,” he said.

“It’s about introducing more improvements more often and getting technology into the car that our customers need and want.”

The new cars will go on sale in late September.

Source: www.theaustralian.com.au

Sustain Ability Showcase Asia, Climate Alliance & Earth Charter Festival

Sustain Ability Showcase Asia is being set up in Singapore to promote clean technology and clean energy in the booming Asia marketplace. Ken Hickson is on another mission this week to advance this plan. Meanwhile, the Climate Alliance has set up in Australia to make it easier for business leaders to become better informed about the opportunities and risks of climate change. Its first conference is in Melbourne 7 October. And the Australia Pacific Earth Charter +10 Festival is being held in Brisbane on 16 to 19 September 2010.

Report from Ken Hickson:

Sustain Ability Showcase Asia is being set up in Singapore by ABC Carbon and other Australian partners to help get clean technology and clean energy businesses into the booming Asia marketplace.

Ken Hickson is on another mission to Singapore this week to advance this plan. He is a moderator at the Indian Institute of Management Alumni Association seminar on Sustainable Development on Friday evening. Guest of honour for the event is Singapore Minister of Foreign Affairs George Yeo.

The aim of Sustain Ability Showcase Asia (SASA) is the direct promotion of business, products and services to relevant Singapore based Government agencies, trade and industry companies and businesses, industry groups and associations.

This will be done by setting up a permanent display centre in Singapore for the purpose in a suitable business location, desirably in association with an appropriate Government agency and a commercial concern.

“We already have many Queensland businesses, and some from other Australian States, who want to be involved in our Singapore programme. We are also getting a green welcome mat from Singapore Government agencies,” Ken Hickson said.

SASA will also identify and advise clients and partners of relevant Trade Shows and Conferences in Singapore and regionally, which can be best utilised to promote clean tech products and services.

Ken has a long history of being involved in business in Asia. He set up and ran a international communication consultancy in Singapore, where he was based for 17 years from 1983 to 2000.

He assures abc carbon express readers that the weekly e-newsletter will continue, even though he will be spending more of his time in Singapore. “It will have a growing Asia Pacific focus, but will still make sure its Australian origins and supporters are well represented,” Ken said.

A website is under development – www.sustain-abilty-showcase.com – but in the meantime information will be provided through Ken Hickson’s ABC Carbon.

Source: www.abccarbon.com

The Asia Pacific Centre for Sustainable Enterprise (APCSE), Griffith Business School, in association with the United Nations Association of Australia (QLD) is pleased to invite you to the following event:

The Australia Pacific Earth Charter +10 Festival  is being held in Brisbane on 16 to 19 September 2010. The Festival is a celebration of the 10th Anniversary of the launch of the Earth Charter and will focus on our collective ability to respond to the major impacts of climate change, the global financial crisis and regional conflicts using the values and principles of the Earth Charter as a way forward. The Festival will bring people to Brisbane from across Australia and from neighbouring countries in the Pacific region to share ideas in an atmosphere of celebration and collaboration.

On day two, Friday 17 September, APCSE in partnership with the United Nations Association of Australia (UNAA) (Queensland) is holding a session on corporate and global governance “Harvesting the Benefits: Business Action on The Earth Charter”. This session will comprise of keynote presentations and business commitments to positive action from Westpac and InterfaceFLOR (Australia), amongst others, followed by interactive break-out sessions led by key thinkers on ‘learning for action’.    

Venue: The Ship Inn Function Room (Level 2), Graduate Centre (S07), South Bank campus, Griffith University, Brisbane.

Source: www.griffith.edu.au/business-commerce/sustainable-enterprise

All about the Climate Alliance:

Climate Alliance is a not for profit company that aims to make it easier for business leaders to become better informed about the opportunities and risks of climate change.

Climate Alliance is hosting its National Conference in Melbourne in the afternoon of October 7th. There is an excellent line-up of speakers confirmed for the event. Please visit here for more details:

http://www.climatealliance.org.au/events/national-conference-2010.html

As part of the conference, we will also be announcing the winners of the three Climate Alliance Leadership Awards. Nominations are open now and we would appreciate you nominating for the Board, Executive/Director or the Company award.

Nomination is a simple process and nomination submissions close on the 17th September 2010. Please visit here for the details and the form:

http://www.climatealliance.org.au/images/stories/Awards_Registration_Form.pdf

O n the afternoon of the 7th October, 2010 Climate Alliance will host a National Conference for company directors and senior executives. The conference will be held at Karstens Conference Centre in Queen Street, Melbourne.

The theme of the conference is  “Climate Change – the Upside of Action”.

The program will be comprised of a number of presentations, a Panel discussion, announcement of the Leadership Awards and drinks & networking to conclude the afternoon. A detailed program will be provided in the near future.

CONFERENCE SPEAKERS

Climate Alliance is delighted to announce that the following executives will be presenting or participating on a Panel.

• Mr Jeremy Baskin, Director, University of Cambridge Programme for Sustainability Leadership
• Dr Peter Binks, Director, Ceramic Fuel Cells
• Ms Liz Bossley, Director, CEAG, London based carbon trader and author
• Mr Luke Chamberlain, Wilderness Society Victoria
• Ambassador David Daly, Head of EU Delegation in Canberra
• Mr Ian Dunlop, Former CEO AICD (To be confirmed)
• Mr Nathan Fabian, CEO, Investor’s Group on Climate Change
• Dr Merv Jones, Chairman, Pacific Environment Ltd and Director, Orbital Corporation
• Mr Jon Jutsen, Executive Director, Energetics
• Mr Paddy Manning, National Chief of Staff – Business, Fairfax Media
• Mr Frank O’Connor, Mayor, City of Port Phillip, Victoria.
• Professor John Thwaites, Chair, Monash Sustainability Institute
• Mr Martijn Wilder, Partner, Baker McKenzie

The speakers will address issues such as:

• Why should a Board encourage the executive to reduce a company’s carbon footprint? Where are the low hanging fruit?
• What can be learned from the European carbon trading experience?
• What practical, real-world success stories can be used to demonstrate the benefits of action?
• How does the environment provide economic benefit to the economy?
• What risks do directors and companies face by not being pro-active? What role do regulations play? What have EU directors experienced?
• How does the investment community regard sustainability?

Source: www.climatealliance.org.au