Over to Business to Lead

It is always stimulating and ever hopeful when you attend a conference like the latest Climate Change and Business event in Sydney. There’s a wealth of talent, access to brilliant minds, and updates on all the wonderful business of climate change being done here and around the world. Then you come thudding down to earth when you hear politicians talk! Leadership is what’s needed but there’s little sign of that. Business is taking a lead, and there must be more of that. New Zealand has shown that it is possible to get an emissions trading scheme underway and Minister Nick Smith should sit down with his Australian counterparts to show how it’s done. We also hear of all the other policies and plans from offshore which our Government needs to take notice of. Singapore leads the way in its usual enterprising way, for energy efficiency, buildings and transport. Pakistan and Russia continue to take a belting from the weather and we see what impact that is having on their economies and their people. And we wonder whether the latest job Kevin Rudd has been given will make any difference at home or abroad. There’s some encouraging energy news concerning hot rocks, biochar, wind and electricity generation. We see how climate change could boost learning in science for students. Don’t forget to check out Beyond Zero Emissions, Make Poverty History and Walk Against Warming.  It’s all on for young and old. – Ken Hickson

Profile: Dr Nick Smith

New Zealand Minister for the Environment and Climate Change Issues Dr Nick Smith told the Climate Change and Business conference in Sydney that the emissions trading scheme which started 1 July this year is not a complete answer but an important first step on the path to reduce emissions. Also, since the passing of the NZ ETS into law, more than 80% of new consents lodged have been for renewable generation in hydro, wind, geothermal and marine, whereas the bulk of new electricity generation in the last ten years has been from coal, gas and diesel.    

Nick Smith       

Minister for the Environment

Minister for Climate Change Issues

Nick was born and educated in North Canterbury and first stood for public office at the age of 18 for the Rangiora District Council while still at High School. Nick attended Canterbury University where he completed a Civil Engineering degree followed by a PhD in Landslides.

Having joined the National Party as a teenager Nick has held governing positions through all levels of the organisation and has been involved in several campaigns.

Nick entered parliament in 1990 and was the first National MP in Tasman since 1932, then following the MMP reforms in 1996, was elected the first Nelson National MP since 1954. He continues to hold the seat with a comfortable majority. A Minister in the previous National Government he has held the portfolios of Education, Corrections, Conservation, Assoc Minister of Immigration, Treaty Negotiations and Social Welfare.

Nick is deeply involved in his local Nelson community, and particularly enjoys constituent work. Nick is married to Linley, and is the proud father of Hazel and Logan, and stepfather of Samantha and Alexander.

11 August, 2010

Here is an edited version of the speech by Dr Nick Smith to the Australia New Zealand Climate Change and Business Conference, Sydney

NZ’s moderated ETS

The legislation we passed last November gives New Zealand a workable and practical emissions trading scheme.

The economic analysis we commissioned on becoming Government in 2008 clearly concluded that an ETS was the most efficient way for New Zealand to curtail emissions at least cost to the economy.

However, we also identified some real issues with the approach by the previous Government that needed correcting.

The major policy changes we made were in respect to allocations for trade-exposed, emissions intensive industries.

The former rules discriminated against small and medium sized businesses and acted as a disincentive to growth.

It is our view the qualifying limit should be based, not on an absolute level of emissions, but in proportion to a business’ turnover.

These changes mean a far wider group of businesses have been eligible for support – albeit the total allocations to industry have changed little.

We also changed allocations to be production-based. If companies grow, their allocations will increase. If they cut their production, their allocations will drop.

This change reflects the Government’s ambition of wanting the ETS to encourage more efficient production and investment in new technology and not reduced economic activity or result in the exporting of industries offshore.

A further change was in making allocations on an industry average basis. We did not want to reward those with higher emissions and punish those who invested early in improving efficiencies.

The final major challenge to allocations was in slowing down the phase out of industry support. There was no phase out scheduled until 2018 but then at a very aggressive rate of 8% per year.

Our approach of 1.3% per year starting in 2012 generated much more debate than it deserved. The truth is these rates are subject to regular review and it is inevitable they will be altered in response to progress internationally.

The underlying principle for our Government will be to phase out such support in line with our major trading partners.

Other significant changes to the ETS included deferring agriculture’s entry by two years to 2015. The technical difficulties on including agriculture emissions cannot be understated.

We also took a pragmatic view that in the wake of the global recession imposing the full cost of the ETS on households and businesses was not realistic.

However, we did not wish to detract from the full price incentives on the forestry sector that is so important in the New Zealand context.

That is why the scheme provides for only a half obligation during its transitional phase meaning a de facto price for emitters of $12.50 per tonne, while foresters enjoy the full benefit of $25 a tonne price for new plantings.

We also passed a considerable number of amendments to deal with issues such as tree weeds, providing equitable support for the fishing industry and resolving Treaty of Waitangi matters.  

Our final ETS design did not by any means achieve universal acceptance.

I have received strident opposition from both extremes of the political spectrum. Some say the ETS doesn’t do enough; others say it goes too far.

This confirms my view that we have the balance broadly right. It is not a complete answer by any means but is an important first step on the path for New Zealand to reduce emissions.

It is often said that on any journey, however far, the most important and difficult step is the first. We made that step on 1 July and it is a significant achievement.     

It is interesting to reflect today on the implementation. Despite a great deal of pre-introduction hype, 1 July passed with only modest price changes.

Variations in fuel and electricity prices were consistent with Government estimates and small compared to the many other factors that influenced energy prices.

The allocation process is well underway for the fishing, industrial and forestry sectors.

We expect to allocated 11.7 million units worth $290 million to the industrial sector between now and the end of 2012

For the industrial sector the Government is deciding on and issuing allocations in three tranches or groups.

The first group of these will be a number of large, energy intensive companies, performing activities such as aluminium smelting, and the production of paper and packaging.

We have already received a number of applications from these companies and when fully allocated this group will represent more than 80% of the total units expected to be allocated.

Applications for Group two and three, which includes many smaller enterprises, are progressing well – albeit a number of industries have sought a slowing of the timetable to enable accurate data to be collected.

This year there will also be a one off allocation of 700,000 New Zealand Units to fishing quota owners. This is to compensate for the effect of increased fuel costs from the ETS on the value of their quota and is a transitional measure.

The Government received more than 760 applications and I’m pleased to announce that this week, successful applicants will be receiving notice of their provisional allowances of units. 

Some allocations have already occurred in the forestry sector and the New Zealand government estimates that approximately 75 million units will be allocated to this sector in the period to 2012.

This massive allocation reflects the huge importance of forestry to New Zealand in the context of climate change.

It is only through the substantial plantings of the new forestry since 1990 that New Zealand has been able to offset its significant 25% increase in gross emissions.

Without these plantings New Zealand would face a substantial Kyoto deficit.

It is also important to note that quite modest new plantings into the future could play a very important role in reducing New Zealand’s net emissions in coming decades, and the incentives provided by the ETS will play a crucial role in securing these long-term investments.

Now the ETS is implemented there is evidence that the scheme has presented new business opportunities and started to motivate businesses to take positive action against climate change.

Forestry is critical to New Zealand’s long term emissions profile and there are signs the ETS has already started to have a positive impact in this area.

Up until 2009, deforestation was on the increase – with 30,000 hectares lost from 2005 to 2008. However with the positive signals sent by the ETS, this has turned around and in 2009 planted forest area switched from a loss to a gain.  The indications we have received from foresters is that this trend is set to continue.

Some companies have already entered into significant afforestation projects since the legislation for the revised NZ ETS was passed.

For example in February this year, Taupo company Puketapu 3A Incorporation, electricity generator Mighty River Power and the Lake Taupo Protection Trust have made a 2400-hectare forest deal in Taupo that will reduce carbon emissions and nitrate run-off. This deal involves a farm-to-forestry conversion and the subsequent sale of carbon credits from the forests to Mighty River Power.

And it’s not just major players realising these benefits – more than half of the almost 400 voluntary forestry participants in the ETS are for forests of less than 50 hectares.

In response to the ETS, some farmers have started to plant forests on their properties. For farmers who have steep, erosion-prone and largely unproductive land, forestry offers them a chance to boost their returns – both economically and environmentally.

Apart from creating incentives for afforestation, the NZ ETS has also encouraged renewable energy.

The bulk of new electricity generation in the last ten years has been from coal, gas and diesel.  However, since the passing of the NZ ETS into law, more than 80 percent of new consents lodged have been for renewable generation in hydro, wind, geothermal and marine.  

We know that people respond to incentives and the early evidence is indeed encouraging.

For the complete speech and more information on the New Zealand ETS go to the website:

Source: www.beehive.govt.nz

Ideas for a Low Carbon Economy: Australia Hit with Ten of the Best

Australia never managed to get its emissions trading scheme (or CPRS) off the ground, even though our smaller trans-Tasman neighbour New Zealand did. Now both major parties in Australia are being attacked for a lack of strong (or any!) policies on climate change, it would seem alternative ideas are needed. So Graham Readfearn for ABC Environment has scanned the globe for climate policies and come up with ten of the best.

Graham Readfearn on ABC Environment (9 AUG 2010):

Some might say the government and the opposition are lacking for ideas on climate change policy. ABC Environment has 10 good ones they could consider.

THE GOVERNMENT’S proposed emissions trading scheme never quite got off the ground. And with both major parties being attacked for a lack of strong policies on climate change, it would seem alternative ideas were thin on the ground in the party rooms. However, ABC Environment has scanned the globe for climate policies the next Australian Government could steal. Ten of the best are here:

1. Carbon tax – Canada

A carbon tax has been proposed by both Ross Garnaut and the Greens as an interim measure while the details of a trading scheme are nutted out. In 2008 the Canadian province of British Columbia introduced a carbon tax on the burning of fossil fuels which currently stands at $21 per tonne of greenhouse gases but will rise to $32 by 2012. So far, the BC government has collected $906 million, but the tax is revenue neutral. This means all the money collected gets returned to citizens in cuts to other taxes. Although the tax only relates to emissions from burning fossil fuels, the BC Government says it accounts for 77 per cent of the state’s overall greenhouse gas footprint.

2. Climate levy – UK

A similar idea from the UK is their Climate Levy. Four years before the UK joined the rest of Europe in the world’s first emissions trading scheme, the government introduced its Climate Change Levy. The scheme is a business tax on all energy used including natural gas, electricity, petrol and coal. The current charge for electricity use is just less than one cent per kilowatt-hour. Electricity from renewable sources is exempt. Many industries have negotiated discounts to the tax, but these depend on those sectors reaching efficiency targets.

3. Coal tax – India

Why tax everything, when you could just tax the main offender? The Indian government has taken the literal step of taxing burning coal to pay for cleaner ways to generate energy. The Indian Government’s Clean Energy Cess (another word for tax) came into force in July 2010 and places a levy of about $1.20 per tonne on the country’s coal production, estimated to be 570 million tonnes for this current tax year. The revenue will be used to install 20,000 MW of solar power generation by 2022. By comparison, the Australian Government’s Solar Flagships Program will install 1,000 MW of solar power generation.

4. Electric cars – China, USA, UK

Never mind cash for clunkers, how about cash for a shiny new electric car? Late last month, the UK Government announced it would give an $8,700 rebate towards the cost of buying an ultra-low emission car. The US Government already offers a credit of up to $8,300 on the cost of an electric car. In June, the Chinese Government announced a pilot policy in five cities to provide a $9,800 subsidy to anyone buying an electric car. One of the cities included is Shanghai which has a population of close to 20 million with 8.5 million private cars. About seven per cent of Australia’s total carbon footprint comes from passenger road transport.

5. Cleaner cars – France

France’s national bonus-malus policy on new vehicle purchases avoids new-fangled electric cars, and instead encourages the uptake of more fuel-efficient cars. Introduced in late 2007, anyone buying a new vehicle that emits 130 grams of CO2/km or less gets a Government bonus payment. The amount you get ranges from $290 to $7,300 depending on how efficient the vehicle is. Penalty fees kick in for new vehicles which emit 161g of CO2/km or more, starting at $290. For people buying vehicles that emit more than 250g CO2/km, their penalty is $4,000. If Australia had the French scheme, for example, Toyota Prius buyers would get a $1,447 bonus but Holden Commodore customers would be penalised $2,315. In the first year of bonus-malus, sales of greener cars went up by 45 per cent while sales of cars emitting more CO2 dropped by 42 per cent.

6. Green roofs – Canada

From February this year in Toronto, at least 20 per cent of the roofs of most new residential, institutional or commercial buildings must be covered in greenery. The new green roof bylaw came after a report to city planners concluded that if all the city’s available roof space was “greened” the annual financial benefits could be as high as $40 million. Advantages included lower energy consumption, lower urban temperatures, better air quality and big savings on managing storm-water run-off. Australian Federal politicians in Parliament House should be used to the idea as they sit beneath a green roof every day.

7. White roofs – US

So we know about green roofs, but what about white roofs? The US energy secretary Steven Chu has just announced all new or replacement roofs of his department must be lighter and more reflective. Lighter roofs keep buildings cooler, reduce the “urban heat island” effect, cut energy consumption and also radiate less energy into the atmosphere than dark roofs. A recent study found lightening roofs and pavements in big cities in the northern hemisphere could give a one-off saving of 57 billion tonnes of greenhouse gas emissions. In 2008, the world’s emissions were 28 billion tonnes.

8. Solar hot water – Spain

Australia has schemes to encourage people to heat their water from the sun, but in Spain (pdf) the government introduced a law requiring minimum amounts of solar hot water. The law, which originated in 2000 in the city of Barcelona, applies to all new and renovated roofs in medium and large buildings. Depending on conditions such as location or the amount of water needed, as much as 70 per cent of hot water must be heated with solar.

9. Feed-in tariff – Germany and others

Feed-in tariffs guarantee a price for renewable energy which is fed into the electricity grid, whether from domestic rooftops or even large scale generators. Australia has seven different state and territory feed-in tariffs but no unifying national tariff. There are 50 other countries that do have a national scheme, including South Africa, UK, Greece, Japan, Czech Republic, India, Kenya, Slovenia, Taiwan, Thailand and Ukraine. The most long-standing and successful scheme is Germany’s (pdf), which analysts say cut 57 million tonnes of emissions in 2008 compared to the eight million tonnes saved through Germany’s role in Europe’s emissions trading scheme.

10. Carbon points – Republic of Korea

Most people have heard of rewards programs where you can gain points when you buy products. In the Republic of Korea the Government has taken the rewards points idea to encourage people to buy climate friendlier products. Launched last year, its “carbon cashbag” scheme covers electrical items such as televisions, DVD players, heaters and air-conditioners. Buying energy efficient models attracts points which can be redeemed on public transport, utility charges or buying other appliances.

http://www.abc.net.au/environment/articles/2010/08/09/2977596.htm

Singapore Builds on Leadership in Energy Efficiency & Transport

Singapore provides another good example (or three!) for Australia to borrow in the climate change action basket. From a recent visit, editor Ken Hickson noticed a strong emphasis on energy efficiency – for transport and buildings – as well as serious attempts to bring about vastly improved waste management and water management processes. Then there’s a lift that generates kinetic energy – one of the features that helped the Asia Square twin tower development in Singapore win a Leadership in Energy & Environmental Design Core & Shell Platinum certification by the US Green Building Council.

Report from The Fifth Estate (11 August 2010):

A twin tower development in Singapore designed by designed by Denton Corker Marshall and Architects 61 has been awarded the Leadership in Energy & Environmental Design Core & Shell Platinum certification by the US Green Building Council.

Developed by MPGA and, the “Asia Square” development, of about 185,800 square metres of office space, is expected to consume about 33 per cent less energy than most standard commercial buildings, saving close to 10 million kilowatts per year. It is also expected to save approximately 40 per cent or 65 million litres of water per year as compared to most standard commercial buildings.

Asia Square’s project director Jeremy Choy says that the development’s sustainable features will provide a healthier working environment that will add value to business.

“Asia Square has been designed for long-term sustainability and to create a healthier working environment for tenants to boost employee productivity. This will enable the future tenants of Asia Square to attract and retain high-value, knowledge-based employees. Very simply, what’s better for people will in the long run be better for business.”

A lift that generates kinetic energy is one of the features that helped the Asia Square twin tower development in Singapore win a Leadership in Energy & Environmental Design Core & Shell Platinum certification by the US Green Building Council.

Developed by MPGA and designed by Denton Corker Marshall and Architects 61, the development located in the New Downtown section of Singapore’s Marina Bay will feature about 185,800 square metres (two million square feet) of office space as well as a 280 room hotel.

Still under construction, one of Asia Square’s centrepiece features will be a natural light enhancing 100,000 square foot atrium called “The Cube,” featuring a 16 metre-high ceiling and extensive tree planting to help bring overall temperature down.

In terms of energy savings, Asia Square is expected to consume about 33 per cent less energy than most standard commercial buildings, saving close to 10 million kilowatts per year. It is also expected to save about 40 per cent or 65 million litres of water per year as compared to most standard commercial buildings.

Source: www.thefifthestate.com.au

Report from Singapore from the Energy Efficiency Programme Office (E2PO)

How can we address climate change?

Climate change is a global phenomenon and as an island state, Singapore is not spared from the effects of climate change such as warming temperatures and rising sea levels. NEA has commissioned a vulnerability study in consultation with other government agencies to study the possible effects and impacts of climate change on Singapore.

In Singapore, the primary greenhouse gas from human activities is carbon dioxide that is released when fossil fuels such as oil and gas are burnt to meet our energy needs. Our energy demand is expected to grow in the future due to an expanding economy and a growing population. Much of this growing energy demand could be avoided if we use energy more efficiently instead of increasing energy production. Energy Efficiency is therefore an important strategy to reduce our GHG emissions.

In addition to mitigating climate change, there are many benefits to energy efficiency. Energy efficiency goes a long way towards:

• Enhancing our air quality
  In addition to greenhouse gas emissions, the burning of fossil fuels also generates air pollutants such as sulphur dioxide and particulate matter. By adopting more efficient technologies or practices we can reduce these pollutants, improve our air quality and secure a better quality of life for Singaporeans.
• Increasing our economic competitiveness
  Improving energy efficiency will result in overal cost savings to businesses and consumers. This helps to cushion the impact of rising energy costs. A more energy efficient economy can help Singapore maintain its competitiveness over the long term.
• Reducing our dependence on fossil fuels
  Singapore is almost totally dependent on imported fossil fuels for her energy needs. Prudent use of energy through energy efficiency measures would help to moderate this dependence and defer the need for installing new energy infrastructure.

Energy Efficiency in Singapore

On an economy-wide level, energy consumption per dollar services gross domestic product ($GDP), or energy intensity, is used globally as an indicator of a country’s state of energy efficiency. Singapore’s energy intensity improved by 15% between 1990 and 2005 due to the adoption of better technology in power generation and the more productive use of energy in other sectors.

Energy Efficiency is a cost-effective means of mitigating GHG emissions. Although energy efficiency makes financial sense, energy efficiency measures may not be implemented due to market barriers such as the lack of information and capability.

To drive energy efficiency improvement in Singapore, the Energy Efficiency Programme Office (E²PO) has been established. The E²PO is an multi-agency committee led by the National Environment Agency (NEA) and the Energy Market Authority (EMA) and comprises the Economic Development Board (EDB), Land Transport Authority (LTA), Building and Construction Authority (BCA), Housing and Development Board (HDB), Infocomm Authority of Singapore (IDA) and the Agency for Science, technology and Research (A*Star). The Ministry of the Environment and Water Resources (MEWR) and Ministry of Trade and Industry (MTI) are also represented at the committee.

The E²PO has identified the following areas for action in developing a holistic energy efficiency strategy and Masterplan for Singapore:

• Promoting adoption of energy efficient technologies and measures by addressing the market barriers to energy efficiency
• Building capability to drive and sustain energy efficiency efforts and to develop the local knowledge base and expertise in energy management
• Raising awareness to reach out to the public and businesses so as to stimulate energy efficient behaviour and practices
• Supporting research & development to enhance Singapore’s capability in energy efficient technologies

TRANSPORT

Transport solutions can play a critical role in improving the state of energy efficiency of Singapore.  To improve energy efficiency on the move, the E²PO aims to:

• Promote the use of Public Transport

Promoting the use of public transport is a key thrust of LTA’s land transport masterplan.  Public transport is highly energy efficient on a per passenger-trip basis.  Today, the public transport mode share stands at 63% during morning peak hours. LTA intends to increase the public transport mode share to over 70% in the next 10-15 years.  To achieve this, LTA will enhance the public transport infrastructure, improve public transport services and more.

• Promote the use of more energy efficient vehicles

Green Vehicle Rebate:
Green vehicles are more fuel-efficient and emit less air pollutants than their conventional petrol or diesel equivalent. To promote the use of green vehicles, LTA and NEA jointly introduced the Green Vehicle Rebate (GVR).  GVR aims to bring about a change in consumer behaviour to support clean emerging technologies, by narrowing the cost differential between a green vehicle and the conventional equivalent model.

Fuel Economy Label:
The Fuel Economy Labelling Scheme (FELS) for Passenger Vehicles is administered by the Singapore Environment Council and supported by NEA. The main objective of this scheme is to raise consumer awareness of fuel economy in passenger vehicles. By making fuel economy information readily available at point-of-sale, consumers would be able to make a more informed decision when purchasing new vehicles.

Information on all vehicles participating in the Fuel Economy Labelling Scheme for Passenger Vehicles is available at the Fuel Economy Database. Drivers may wish to learn about driving tips for better fuel economy here.

• Ease traffic congestion for better fuel economy

Managing road usage to ease traffic congestion is another key thrust of LTA’s land transport masterplan. Traffic congestion is an issue in virtually every urban city in the world. Fuel economy deteriorates during traffic congestion as vehicle speed slows and longer time is needed to transverse the same distance. LTA will continue to manage road congestion through infrastructure development, refinement of car ownership and usage restraint measures such as the Electronic Pricing (ERP) system.

Source: www.e2singapore.gov.sg, www.app.nea.gov.sg and www.lta.gov.sg

Extreme Weather Proves Global Warming is Already Happening

Almost 14 million people have been affected by the torrential rains in Pakistan, making it a more serious humanitarian disaster than the South Asian tsunami and recent earthquakes in Kashmir and Haiti combined. The world weather crisis that is causing floods in Pakistan, wildfires in Russia and landslides in China is evidence that global warming predictions are correct. Experts from the United Nations and universities around the world said the recent “extreme weather events” prove global warming is already happening.

By Louise Gray, Environment Correspondent, Daily Telegraph, Uk (10 August 2010)::

Almost 14 million people have been affected by the torrential rains in Pakistan, making it a more serious humanitarian disaster than the South Asian tsunami and recent earthquakes in Kashmir and Haiti combined.

The disaster was driven by a ‘supercharged jet stream’ that has also caused floods in China and a prolonged heatwave in Russia.

UN relief agencies forced to suspend Pakistan rescues. It comes after flash floods in France and Eastern Europe killed more than 30 people over the summer.

Experts from the United Nations (UN) and universities around the world said the recent “extreme weather events” prove global warming is already happening.

Jean-Pascal van Ypersele, vice-president of the body set up by the UN to monitor global warming, the Intergovernmental Panel on Climate Change (IPCC), said the ‘dramatic’ weather patterns are consistent with changes in the climate caused by mankind.

 “These are events which reproduce and intensify in a climate disturbed by greenhouse gas pollution,” he said.

“Extreme events are one of the ways in which climatic changes become dramatically visible.”

The UN has rated the floods in Pakistan as the greatest humanitarian crisis in recent history, with 13.8 million people affected and 1,600 dead.

Flooding in China has killed more than 1,100 people this year and caused tens of billions of dollars in damage across 28 provinces and regions.

In Russia the morgues are overflowing in Moscow and wildfires are raging in the countryside after the worst heatwave in 130 years.

Dr Peter Stott, head of climate monitoring and attribution at the Met Office, said it was impossible to attribute any one of these particular weather events to global warming alone.

But he said there is “clear evidence” of an increase in the frequency of extreme weather events because of climate change.

“The odds of such extreme events are rapidly shortening and could become considered the norm by the middle of this century,” he warned.

Dr Stott also said global warming is likely to be make extreme events worse. For example, when there is more heat in the atmosphere it holds more water and therefore floods in places like Pakistan are heavier.

“If we have these type of extreme weather patterns then climate change has loaded the dice so there is more risk of bad things happening,” he said.

Professor Andrew Watson, a climatologist at the University of East Anglia, which was at the centre of last year’s ‘climategate’ scandal, said the extreme events are “fairly consistent with the IPCC reports and what 99 per cent of the scientists believe to be happening”.

“I’m quite sure that the increased frequency of these kind of summers over the last few decades is linked to climate change,” he said.

Source: www.telegraph.co.uk

Heatwave in Russia Hits Economy & World Wheat Prices

Russia’s worst heatwave on record has stoked wildfires and parched crops in last year’s No. 3 global wheat exporter, leading to a grain export ban, sending prices of wheat to two-year highs at one point and prompting the World Bank to warn against hasty restrictions on exports. Economists say the heatwave could knock 1 percentage point off Russia’s gross domestic product, weakening an economic recovery from a 2009 slump due to the global financial crisis.

Aleksandras Budrys for Reuters (11 August 2010):

MOSCOW – Scorching heat will keep hammering Russia for the next 10 days, a top weather official has said, and seeding for the winter grain crops is in danger if there is no rain after that.

Russia’s worst heatwave on record has stoked wildfires and parched crops in last year’s No. 3 global wheat exporter, leading to a grain export ban, sending prices of wheat to two-year highs at one point and prompting the World Bank to warn against hasty restrictions on exports.

“The situation is not changing radically,” deputy director of Hydrometcentre, the government weather forecasting unit, Dmitry Kiktyov said of the heat wave that has cost 54 lives in fires and, economists said, could wipe $US14 billion off economic growth.

“The temperature will change insignificantly, and there will be only local rains. They will be insufficient to cushion the current situation,” he said.

The drought could slash Russia’s 2010 grain output by nearly 40 per cent to 60 million tonnes, and the winter wheat sowing campaign could begin to be in jeopardy if there is no rain during or right after the next 10 days.

“Our investigations show that the sowing may be delayed by some 10 days without losses. But only in case of rains,” agricultural forecasting official Anna Strashnaya told Reuters.

Prime Minister Vladimir Putin, who said Russia’s ban on grain exports could extend into next year, noted the drought could prevent some regions from starting the sowing campaign for the 2011 winter grain crop, which normally accounts for roughly 40 per cent of the total.

The majority of Russia’s grain crops are not planted until the spring, allowing much more time for conditions to improve.

World bank

On Tuesday, World Bank President Robert Zoellick cautioned against countries taking any action that could add to market uncertainty, in particular widespread export bans like Russia’s.

“The situation in world grain markets is very uncertain and therefore somewhat volatile,” Mr Zoellick told reporters in Sofia.

“What is better this time is that the buffer stock is a little higher than a couple of years ago,” he said, referring to tightness in global grains markets in 2008.

“We are cautioning countries about taking actions that might be appealing domestically but could add uncertainty on markets such as bans on exports,” Mr Zoellick said, echoing comments by World Bank Managing Director Ngozi Okonjo-Iweala.

Economists say the heatwave could knock 1 per centage point off Russia’s gross domestic product, weakening an economic recovery from a 2009 slump due to the global financial crisis.

The crop failures will hit Russian farmers particularly hard. Only around 25 per cent of Russia’s crops are insured, compared with 80 per cent in the United States, Swiss Re, the world’s second-biggest reinsurer said on Tuesday.

Wheat markets slid further on Tuesday from last week’s two-year highs, as traders assessed the damage to grains production across the Black Sea region that also includes major grains producer Ukraine, and pointed to ample stocks after two years of good harvests.

“With these bull runs you need to keep feeding the rally and we’ve seen most of the bad news now,” Rabobank analyst Luke Chandler said.

Wheat prices on the Chicago Board of Trade traded as low as $US6.90 a bushel on Tuesday, around 18 per cent below last week’s peak of $US8.41, before rebounding to $US710-1/4 by 1559 GMT.

Prices remain far below the peaks set during early 2008 when shrinking inventories and rising energy markets saw CBOT wheat futures rise as high as $US13.34-1/2.

The two largest global wheat crops in history in 2008 and 2009 have resulted in much higher stock levels now and a return to the prices seen two years ago is considered unlikely.

Still, prices remain more than 50 per cent higher than June lows, and importers are reluctant to commit to deals at current prices.

Turkey’s state grain office said on Tuesday it had sufficient wheat stocks while Jordan said it had enough wheat stocks to cover its needs for six months but would be forced to switch to more expensive US or European grains.

Source: www.climatespectator.com.au

Make or Break for Geodynamics in Hot Rock Drilling Program

Geodynamics has spent an estimated A$300 million over the past decade on the development of its cutting edge hot dry rocks geothermal technology in the Cooper Basin. Sometime in the next month or so it might find out if it has all been worth it. Geodynamics is by far the best funded of Australia’s growing brigade of geothermal aspirants, with a cash balance of around $70 million, but it needs to tap the market for more money within the next six months to continue its ambitious program.  

Giles Parkinson in Climate Spectator (11 August 2010):

Geodynamics has spent an estimated $300 million over the past decade on the development of its cutting edge hot dry rocks geothermal technology in the Cooper Basin. Sometime in the next month or so it might find out if it has all been worth it.

It may seem overly dramatic to label the fracturing tests that will be undertaken at a single well over the next few weeks as a “make or break” for the company.

But that is the way it is being viewed by Geodynamics and its backers. Success will deliver the key to an estimated 6,500MW of clean, base-load power that could be brought to the grid over the next 10 to 15 years; failure will cause the company to undergo a major rethink of its ambitions.

The rest of the geothermal industry also has a lot at stake on what unfolds nearly 5 kms beneath the surface at the Jolokia 1.  A good result will bring much needed investor confidence, a disappointing or inconclusive result may have the opposite effect. And proponents of other technologies will be looking on with interest, too. None more so, perhaps than nuclear, which has a weaker case to argue in Australia if geothermal looks likely to deliver on its promise.

Next week, Geodynamics is scheduled to begin a “hydraulic fracture stimulation program” at the Jolokia well near Innamincka. Water will be injected to a depth of 4.9kms with the aim of finding natural faults in the super-heated granite and opening these up to create a flow of high pressure hot water which can then be exploited to drive a turbine on the surface via a heat exchanger.

It is not the first time such fracture stimulations have been carried out, but no one has done this at the same depth, temperature (280C) and under such extreme pressure (9,000 PSI). It’s cutting edge stuff and the team at Geodynamics (many of them ex-oil drillers) are clearly excited. Last week they got their first photos of the deep fractures (sent before the specially created imaging tool melted). No one seems to have sat down since and there is every confidence that this will be a “make” rather than a “break” for the company.

Jolokia is located nearly 10kms from the company’s previously successful fracturing activities at Habanero. If that success can be repeated at Jolokia, the company argues that this will demonstrate its ability to create heat exchangers at will across its tenement areas – unlocking up to 6,500MW of geothermal resources in the Geodynamics tenements and opening up a new energy province in central Australia.

That would lead to a flurry of activity. The company would return to Habanero to drill two more wells and commission the 1MW pilot plant that was delayed by the blow-out in the Habanero 3 well last year. If the pilot plant is successful, the company can then move to make an investment decision on its proposed 25MW commercial demonstration plant, for which it has federal government support to the tune of $90 million, and gain the confidence to tap the market for funds to pay for an expanded drilling program.

The commercial plant would probably not be up and running till around 2015. In the meantime, Geodynamic’s partner in the Innamincka “Deeps” project, Origin Energy, will lead its own drilling campaign to see if it can unlock energy from the Innamincka “Shallows” – geothermal heat lying in sedimentary acquifers which are considered easier to exploit. The partners believe there might be around 100MW-200MW of “shallow” resources in the immediate area. Exploiting these would provide early revenue and be a complimentary energy play to the larger project. But without the longer-term value of the “Deeps” it is uncertain if this shallow reserve could be economically exploited.

Failure at Jolokia, however, will be a devastating blow. Geodynamics is by far the best funded of Australia’s growing brigade of geothermal aspirants, with a cash balance of around $70 million, but it needs to tap the market for more money within the next six months to continue its ambitious program.

Other companies need money too. The industry – be it pursuing the deep hot dry rock reservoirs or the shallow sedimentary aquifers – would prefer not to find itself in a position where its future may be influenced by the success or failure of a single well, but because funding has been so hard to come by from government and the investment community, that is exactly where it finds itself.

Source: www.climatespectator.com.au

Can Rudd Do For The World What He Failed To Do At Home?

UN Secretary-General Ban Ki-moon has this week appointed former Australian Prime Minister Kevin Rudd to the “mother of all panels” on Global Sustainability, UN climate chief Christiana Figueres told the Climate Change & Business conference on Tuesday night. She expects December’s UN climate talks in Cancun, Mexico would take the world “one more firm step along the road toward climate control”.

CE Daily (11 August 2010):

UN Secretary-General Ban Ki-moon has this week appointed ousted Prime Minister Kevin Rudd to the “mother of all panels”, UN climate chief Christiana Figueres told a Sydney conference on Tuesday night. 

Secretary-General Ban Ki-moon on Monday launched the high-level panel on global sustainability, with members including Rudd, EU Commissioner for Climate Action, Connie Hedegaard, and former South Korean Prime Minister Han Seung-soo, now director of the Global Green Growth Institute. 

“It is a very broad-looking panel that looks at the relationship between climate, health, development, poverty, energy security … you name it,” Figueres said in a live videolink address to the climate and business conference in Sydney. 

“It is the – if you will – the ‘mother’ of all panels,” she said. 

“Because what the Secretary-General is trying to do with this panel is to – in his words – ‘connect the dots’. 

“So he is encouraging members of this panel to take a look at all the different aspects of sustainable growth which are currently being dealt with in an isolated fashion by different venues and different entities and begin to put forward a more integrative view,” she said. 

The panel will look at “how all of these aspects connect to each other, how there may be synergies among them and how the UN might take them forward in an integrative manner,” she said. 

‘Forget the ‘big bang’ theory of climate action’

Figueres told the Climate Change and Business conference that a successful outcome from this December’s UN climate talks in Cancun would comprise a series of decisions that would take the world “one more firm step along the road toward climate control”. 

“I think we all made a mistake by expecting last year at Copenhagen that there would be one magic bullet that would solve the climate crisis. 

“This does not exist,” she said. 

“This is what I call the ‘big bang theory’ of climate. That there would be last year, this year, next year – whatever – one big agreement that would solve both adaptation and mitigation issues of climate in a definitive way,” she said. 

Figueres said the problem had arisen over time and it would take time to deal with it. 
“The only way we can address it is in an incremental gradual manner.”

Source: www.cedaily.com.au

Power Generation in Australia Gets A Greener Tinge

Electricity generation across Australia’s five eastern states was greener in 2009 compared with the previous year. This was despite a continued reliance on coal-fired power stations and an increase in the use of some of the largest and most greenhouse intensive coal-fired stations in the country. The findings are part of The Climate Group’s Electricity Generation Report 2009.

The Climate Group Report (9 August 2010):

                                     
•    Biggest emitting power stations in 2009 revealed
•    Renewables and gas generation grow by 11 per cent and 8 per cent
•    Power station emissions down 2.4 per cent overall
•    Coal-fired electricity dirtier due to increased use of most carbon intensive stations 

Electricity generation across Australia’s five eastern states was greener in 2009 compared with the previous year. This was despite a continued reliance on coal-fired power stations and an increase in the use of some of the largest and most greenhouse intensive coal-fired stations in the country. 

The findings are part of The Climate Group’s Electricity Generation Report 2009, which reports on electricity generation and associated emissions from coal, gas, liquid fuel and renewables. The report reveals the biggest emitting power stations in Victoria, New South Wales, Queensland, South Australia and Tasmania. 

In total, power stations generated 208 million Megawatt hours (MWh) of electricity in 2009, 2.1 per cent less than 2008, and emitted 181 million tonnes of greenhouse gas, a decrease of 2.4 per cent on 2008.

The three biggest emitting power stations in 2009 were all in Victoria: Loy Yang A emitted 18.81 million tonnes CO2e, Hazelwood 16.25 million tonnes, and Yallourn W 15 million tonnes. Bayswater and Eraring in New South Wales were the fourth and fifth most polluting stations, emitting 14.92 million tonnes and 13.96 million tonnes CO2e respectively. 

Growth of 11 per cent in renewable electricity generation and 8 per cent for gas meant that the average carbon intensity of electricity fell by just more than one per cent compared with 2008, to 0.87 tonnes CO2e/MWh. 

The overall share of renewables and gas remains small, accounting for 9.3  per cent and 8.0 per cent of total generation respectively (but up from 8.3 per cent and 7.6 per cent in 2008). 

Electricity and emissions across the five states continues to be dominated by a relatively small number of large coal-fired power stations: the top 20 generators of electricity were all coal-fired and accounted for more than 90 per cent of total greenhouse gas emissions. The top 10 accounted for more than 70 per cent of total emissions.  

Total electricity generated from coal declined slightly, accounting for 82.3 per cent of total electricity, down from 84 per cent in 2008. This fall was largely due to less output from Liddell, Mt Piper, and Vales Point B in New South Wales.

However, electricity generation and emissions from some of the country’s most carbon intensive power stations increased last year. Of the top seven most carbon intensive power stations, six generated more electricity in 2009 – including Victoria’s Hazlewood, Yallourn W and Loy Yang B. 

In South Australia, electricity generation increased at Playford B, the most carbon intensive* station in all five states. In New South Wales, the most carbon intensive generator, Redbank Station, also produced more electricity than in 2008.

Rupert Posner, The Australia Director of The Climate Group said: 

“The report shows that the mandated targets for renewable energy are making a difference, with our electricity becoming less greenhouse intensive.

“The fact that we generated more electricity from some of the most carbon intensive power stations means that, despite having a smaller overall market share, the carbon intensity of coal-fired electricity actually increased.

“This outcome is a clear example of why we need a price on carbon. We need to reduce our dependence on our most greenhouse polluting power stations but without a price on carbon the cheapest, rather than the least-polluting power stations are used first.”

The average carbon intensity of coal-fired power stations in Australia in 2009 was 1 tonne CO2 per MWh, gas was 0.57 and zero for renewables. The results varied across the states – for a state by state breakdown please see the individual sections with the full report.

* Carbon intensity applies to the total electricity generated. Hazelwood is slightly more carbon intensive in terms of “sent out” electricity. 

Source: www.theclimategroup.org

Biochar Gets A Big Boost From US Research Findings

As much as 12% of the world’s human-caused greenhouse gas emissions could be sustainably offset by producing biochar, a charcoal-like substance made from plants and other organic materials. That’s more than what could be offset if the same plants and materials were burned to generate energy, concludes a study published in the journal Nature Communications.

Nature Communications Journal (10 August 2010):

Charcoal takes some heat off global warming

Biochar can offset 1.8 billion metric tons of carbon emissions annually

As much as 12 percent of the world’s human-caused greenhouse gas emissions could be sustainably offset by producing biochar, a charcoal-like substance made from plants and other organic materials. That’s more than what could be offset if the same plants and materials were burned to generate energy, concludes a study published today in the journal Nature Communications.

“These calculations show that biochar can play a significant role in the solution for the planet’s climate change challenge,” said study co-author Jim Amonette, a soil chemist at the Department of Energy’s Pacific Northwest National Laboratory. “Biochar offers one of the few ways we can create power while decreasing carbon dioxide levels in the atmosphere. And it improves food production in the world’s poorest regions by increasing soil fertility. It’s an amazing tool.”

The study is the most thorough and comprehensive analysis to date on the global potential of biochar. The carbon-packed substance was first suggested as a way to counteract climate change in 1993. Scientists and policymakers have given it increasing attention in the past few years. The study was conducted by Dominic Woolf and Alayne Street-Perrott of Swansea University in Wales, U.K., Johannes Lehmann of Cornell University in Ithaca, N.Y., Stephen Joseph of the University of New South Wales, Australia, and Amonette.

Biochar is made by decomposing biomass like plants, wood and other organic materials at high temperature in a process called slow pyrolysis. Normally, biomass breaks down and releases its carbon into the atmosphere within a decade or two. But biochar is more stable and can hold onto its carbon for hundreds or even thousands of years, keeping greenhouse gases like carbon dioxide out of the air longer. Other biochar benefits include: improving soils by increasing their ability to retain water and nutrients; decreasing nitrous oxide and methane emissions from the soil into which it is tilled; and, during the slow pyrolysis process, producing some bio-based gas and oil that can offset emissions from fossil fuels.

Making biochar sustainably requires heating mostly residual biomass with modern technologies that recover energy created during biochar’s production and eliminate the emissions of methane and nitrous oxide, the study also noted.

Crunching numbers and biomass

For their study, the researchers looked to the world’s sources of biomass that aren’t already being used by humans as food. For example, they considered the world’s supply of corn leaves and stalks, rice husks, livestock manure and yard trimmings, to name a few. The researchers then calculated the carbon content of that biomass and how much of each source could realistically be used for biochar production.

With this information, they developed a mathematical model that could account for three possible scenarios. In one, the maximum possible amount of biochar was made by using all sustainably available biomass. Another scenario involved a minimal amount of biomass being converted into biochar, while the third offered a middle course. The maximum scenario required significant changes to the way the entire planet manages biomass, while the minimal scenario limited biochar production to using biomass residues and wastes that are readily available with few changes to current practices.

Amonette and his colleagues found that the maximum scenario could offset up to the equivalent of 1.8 petagrams – or 1.8 billion metric tons – of carbon emissions annually and a total of 130 billion metric tons throughout in the first 100 years. Avoided emissions include the greenhouse gases carbon dioxide, methane and nitrous oxide. The estimated annual maximum offset is 12 percent of the 15.4 billion metric tons of greenhouse gas emissions that human activity adds to the atmosphere each year. Researchers also calculated that the minimal scenario could sequester just under 1 billion metric tons annually and 65 billion metric tons during the same period.

But to achieve any of these offsets is no small task, Amonette noted.

“This can’t be accomplished with half-hearted measures,” Amonette said. “Using biochar to reduce greenhouse gas emissions at these levels is an ambitious project that requires significant commitments from the general public and government. We will need to change the way we value the carbon in biomass.”

Experiencing the full benefits of biochar will take time. The researchers’ model shows it will take several decades to ramp up biochar production to its maximum possible level. Greenhouse gas offsets would continue past the century mark, but Amonette and colleagues just calculated for the first 100 years.

Biochar and bioenergy work together

Instead of making biochar, biomass can also be burned to produce bioenergy from heat. Researchers found that burning the same amount of biomass used in their maximum biochar scenario would offset 107 billion metric tons of carbon emissions during the first century. The bioenergy offset, while substantial, was 23 metric tons less than the offset from biochar. Researchers attributed this difference to a positive feedback from the addition of biochar to soils. By improving soil conditions, biochar increases plant growth and therefore creates more biomass for biochar productions. Adding biochar to soils can also decrease nitrous oxide and methane emissions that are naturally released from soil.

However, Amonette and his co-authors wrote that a flexible approach including the production of biochar in some areas and bioenergy in others would create optimal greenhouse gas offsets. Their study showed that biochar would be most beneficial if it were tilled into the planet’s poorest soils, such as those in the tropics and the Southeastern United States.

Those soils, which have lost their ability to hold onto nutrients during thousands of years of weathering, would become more fertile with the extra water and nutrients the biochar would help retain. Richer soils would increase the crop and biomass growth – and future biochar sources – in those areas. Adding biochar to the most infertile cropland would offset greenhouse gases by 60 percent more than if bioenergy were made using the same amount of biomass from that location, the researchers found.

On the other hand, the authors wrote that bioenergy production could be better suited for areas that already have rich soils – such as the Midwest – and that also rely on coal for energy. Their analysis showed that bioenergy production on fertile soils would offset the greenhouse gas emissions of coal-fired power plants by 16 to 22 percent more than biochar in the same situation.

Plantations need not apply

The study also shows how sustainable practices can make the biochar that creates these offsets.

“The scientific community has been split on biochar,” Amonette acknowledged. “Some think it’ll ruin biodiversity and require large biomass plantations. But our research shows that won’t be the case if the right approach is taken.”

The authors’ estimates of avoided emissions were developed by assuming no agricultural or previously unmanaged lands will be converted for biomass crop production. Other sustainability criteria included leaving enough biomass residue on the soil to prevent erosion, not using crop residues currently eaten by livestock, not adding biochar made from treated building materials to agricultural soils and requiring that only modern pyrolysis technologies – those that fully recover energy released during the process and eliminate soot, methane and nitrous oxide emissions – be used for biochar production.

“Roughly half of biochar’s climate-mitigation potential is due to its carbon storage abilities,” Amonette said. “The rest depends on the efficient recovery of the energy created during pyrolysis and the positive feedback achieved when biochar is added to soil. All of these are needed for biochar to reach its full sustainable potential.”

###

The study was funded by the Department of Energy’s Office of Science, DOE’s Office of Fossil Energy, the Cooperative State Research Service of the Department of Agriculture, the New York State Energy Research and Development Authority, the United Kingdom’s Natural Environment Research Council (NERC) and Economic and Social Research Council (ESRC), and VenEarth Group LLC.

Pacific Northwest National Laboratory is a Department of Energy Office of Science national laboratory where interdisciplinary teams advance science and technology and deliver solutions to America’s most intractable problems in energy, the environment and national security. PNNL employs 4,700 staff, has an annual budget of nearly $1.1 billion, and has been managed by Ohio-based Battelle since the lab’s inception in 1965.

Source: www.eurekalert.org