British price rises reveal premium aspect of renewables

by William Yeatman on October 26, 2004

in Politics

Environmentally-conscious electricity consumers in the United Kingdom have been surprised to see their bills going up by 10 percent as a result of rising oil and gas prices.  The price rises have been condemned as profiteering by the opposition Conservative Party (a believer in global warming alarmism).  Energy spokesman Laurence Roberston told the Times (Oct. 17), It is unbelievable.  It sounds a bit of a con to me.


Green Energy, which raised its prices by an average of 9 percent, said, The demand for renewables has increased over the last three years in no small part as a result in the increase in the voluntary market.  This increase in demand has meant that renewables command a premiumand consequently when the price of brown (non-renewable) energy goes up, renewables move to maintain that premium.


The chief executive of Good Energy also defended a price rise of 7-10 percent by saying, If I kept my prices down and I told my generators to keep their prices down, we would get a lot of customers and then I would run short.


Norman Baker, of the alarmist Liberal Democrat party, commented on learning that economic laws apply to renewable energy as well, It is deeply ironic that people like me who are supporting green energy have found it tied to oil.


Meanwhile, the British governments quango (which stands for quasi-autonomous non-governmental organization) the Energy Saving Trust told British householders to cut down on heat and power and walk to the shops instead of driving (BBC, Oct. 25).  This years winter is projected to be particularly cold in Britain (see last issue).

Scientists push small carbon tax

by William Yeatman on October 26, 2004

in Blog

Venturing into economics once more, the journal Science published a study October 15 by two atmospheric scientists and one economist that called for a carbon tax of 5 cents per gallon, to be gradually increased over the next thirty years.

Michael Schlesinger and Natalia Andronova of the University of Illinois and economist Gary Yohe of Wesleyan called their suggestion, a low-cost insurance policy that protects against climate change.


Schlesinger argues that the current uncertainty surrounding climate change was the main reason for adopting such a proposal as a hedge against the uncertainty.  Hanging his argument on the basis of studies that suggest much greater climate sensitivity than the IPCC finds, Schlesinger concludes that without immediate action it may be impossible to keep the temperature rise below 3 C.


The proposal calls for a carbon tax of $10 per ton of carbon (roughly 5 cents per gallon of gasoline), rising to $33 per ton in thirty years time.

Niger turns to coal to save rainforest

by William Yeatman on October 26, 2004

in Politics

The sub-Sahelian state of Niger has seen authorities turn to promoting the use of coal in an effort to halt deforestation (Inter-Press Service, Oct. 20).  Wood is the primary energy source in Niger, accounting for 95 percent of energy needs.  This means that the country consumes two billion kilograms of firewood each year.


The government aims to replace 25 percent of firewood with coal, mainly by targeting large institutions..  The move will require the Nigerien Coal Company (SONICHAR) to increase production to 33 million kilograms.


The government is also keen to persuade households that coal is more economical than wood.  One restaurateur told IPS that he would save about $20 over a three-week period by using coal.


Even the president of the National Association of Wood Users has endorsed the move.  Elhadj Dodo Mahaman Abdou said, Recourse to coal as a source of domestic energy is a healthy initiative, in the sense that it will allow us to save our forests from altogether disappearing.

IEA releases world energy outlook

by William Yeatman on October 26, 2004

in Blog

The latest edition of the International Energy Agencys World Energy Outlook, released in Paris on October 26, predicts that in the absence of changed policies or accelerated use of new technology world energy demand will increase by 59 percent from now to 2030.  About 85 percent of that increase will be supplied by fossil fuels, and two-thirds of the new demand will come from the developing world, especially India and China.

Nuclear power use will decline in Europe but increase in Asia.  While renewable usage will triple, it will still only account for 6 percent of world electricity production in 2030.


These trends are, however, not unalterable. Our analysis shows that more vigorous government action could steer the world onto a markedly different energy path, said Claude Mandil, the agencys Executive Director. The Oulook suggests that world energy demand can be 10% lower and carbon-dioxide emissions 16% lower in an Alternative Policy Scenario. 


In this scenario, the worlds reliance on Middle East oil and gas are also much reduced.  The scenario depends on more efficient use of energy in vehicles, electric appliances, lighting and industry, which accounts for more than half of the reduction in emissions.  The rest is accounted for by a shift in the power generation fuel mix towards renewables and nuclear power.  Yet, even in this alternative scenario, said Mandil, energy imports and emissions would still be higher in 2030 than today and would still be growing.

What this analysis shows very clearly, he added, is that achieving a truly sustainable energy system will depend on technological breakthroughs that radically alter how we produce and use energy.  Mandil called on governments to take the lead in accelerating the development and deployment of new technologies that allow us to meet our growing energy needs without compromising our energy security and the environment.  (IEA Press Release, Oct. 26)

IPCC chief abandons pretense of policy neutrality

by William Yeatman on October 26, 2004

in Politics

Dr. Rajendra K. Pachauri, chairman of the U. N. Intergovernmental Panel on Climate Change, which decided after its First Assessment Report to be policy relevant, but not policy prescriptive, has stated publicly that certain policies are not good enough.

Pachauri told Reuters (Oct. 25), following the Russian Dumas decision to ratify Kyoto, that, My feeling is that we will probably need to do more than most people are talking about to combat global warming.  He went on, This mustnt lull us into thinking the problem is solved.  Kyoto is not enough.  We now have to look at the problem afresh.


The IPCCs chairman even went so far as to recommend a policy: We need a degree of agreement on where to stabilize concentrations, he said, and added, We have to try to come up with an understanding of where we are heading in the next 30-40 years.


Pachauri also saw fit to prejudge the outcome of the Fourth Assessment Report, due in 2007, saying, My hope is that this will be able to fill gaps, reduce uncertainties and produce a much stronger message.


He also contributed a foreword to a report by the New Economics Foundation and the Working Group on Climate and Development that recommends limiting the global temperature increase to 2 C., opposing the use of carbon sinks in meeting Kyoto targets, and removing World Bank support for fossil fuel projects.

Administrations climate change policies given a B- grade

by William Yeatman on October 26, 2004

in Politics

PERC, the Property and Environment Research Center in Bozeman, Montana, issued its end-of-term report card on the Bush Administrations environmental policies on October 21.  The organization gave the administration a C+ mark overall, including a B- on the individual subject of climate change.


The climate change mark represented an improvement from the mid-term grade of C, and was broken down with a domestic policy mark of C+ and an international policy mark of B.


The grade was given by Andy H. Barnett for the following reasons:  Given the uncertain state of scientific knowledge and the economic flaws of the Kyoto Protocol, the Bush administration was right to reject the protocol and to keep reductions of carbon emissions on a voluntary basis.  But the administration has not been successful at explaining the reasons for these decisions.  The president has defended his position in part by encouraging economic growth in developing countries, which will lead to greater efficiency in fossil fuel use, but agricultural subsidies and tariff policies discourage these countries economic growth.


The full report card, including grades on subjects such as air quality (where the Administration was awarded an F) that are related to global warming, is available at http://www.perc.org/publications/enviro_report_cards/reportcard_2004/pressrelease_2004.php.

Russian Parliament ratifies Kyoto

by William Yeatman on October 26, 2004

in Politics

 The Russian State Duma ratified the Kyoto Protocol by a vote of 334 to 73 on October 22.  The upper house of parliament approved the decision on October 27.

The parliament also passed a statement indicating that the decision was purely for political and diplomatic reasons and was not justified on an economic or a scientific basis.  The statement says that Russia‘s obligations under the protocol will have grave consequences for its economic and social development.


According to Novosti, The decision to ratify the protocol was made with due consideration for its importance for the development of international co-operation and because it could not come into effect unless Russia participates in it.  Other sources suggested the European Unions willingness to allow Russians visa-free travel to the enclave of Kalingrad had a major role in securing Duma support.


French President Jacques Chirac telephoned President Putin to hail the decision as a major contribution to the development of multiparty international cooperation andtherefore highly appreciated in Europe and the whole world (www.putin.ru, Oct. 25).


Once President Putin signs the ratification into law, the next step is for the Russian authorities to submit ratification documents to the United Nations.  Once these documents have been received, the protocol will come into force after ninety days.

EU adopts ‘imperial preference’

by William Yeatman on October 24, 2004

in Kyoto Negotiations, Politics

Commissioner Pascal Lamys announcement on 20 October that lesser developed countries that implement the European agenda of the Kyoto protocol and other international treaties on the environment will be paid off with a lighter tariff burden amounts to the EUs final repudiation of the results of the World Summit on Sustainable Development held in Johnannesburg in 2002.


At the World Summit, the collective voice of the poor countries of the world firmly rejected European attempts to mire them in economic stagnation. Recognizing the importance of cheap, abundant energy to reducing poverty, they rebuffed initiatives aimed at foisting the least efficient, most land-intensive, and most expensive “renewable” energy technologies upon them. They insisted on a multilateral, rather than bilateral, approach to eradicating poverty and moved to ensure “that energy policies are supportive to developing countries efforts to eradicate poverty.”


The new announcement marks a return to the EUs pre-Johannesburg strategy, explicitly rewarding countries for engaging in bilateral agreements with the EU and attempting to ensure that the European agenda wins out over cheaper, more efficient ways of eradicating poverty.


The announcement says that the smallest countries with the most vulnerable economies can gain preferential treatment in the form of dutyfree access to EU markets for over 7,200 products, including agricultural goods.


By aiming the new programme at the most vulnerable economies, the EU is driving a wedge between those countries and the more powerful voices of the developing world, such as China, India and Brazil.


Lamy also confirmed that China would lose its preferential access for textile and clothing imports.


Conventions that the countries will be expected to sign up to by the end of 2008 include the Kyoto protocol on global warming (recently judged a “bad investment” of the worlds money by a panel including three Nobel laureate economists), the Cartagena protocol on genetically-modified organisms (which formalizes a precautionary approach to the best available solution toworld hunger), agreements enshrining trade union rights and even conventions on drug trafficking.


Lamy hailed the initiative as an example of the EUs use of “soft power,” an attempt to exert international influence by means of persuasion and incentives rather than by threats and demands.


The EU comes to this move after seeing the success of its approach towards persuading Russia to move towards ratification of the Kyoto protocol,something that senior Russian sources admit was a purely political decision based on the concessions the EU was offering Russia, rather than any belief that the protocol was scientifically or economically justified.


It is possible, however, that the measure will be seen by developing countries as a whole as an attempt to impose European mores on independent countries.


The measure shows similarities to the British Victorian idea of “imperial preference,” whereby those countries that subjugated themselves to British law and custom were granted access to the greatest market of the era.

Missing in action

by William Yeatman on October 21, 2004

in Politics

In a US election campaign that has seen the presidential candidates attack each other with great ferocity over issues as diverse as national security, retirement pensions and their attitudes to gay marriage, one issue has been prominent only by its absence.

 


The environment was mentioned only in passing in the Presidential debates and has been raised on the campaign trail rarely. What explains the absence of an issue that was so prominent during the last election cycle? First is that, for Americans, the environment is way down their list of priorities. The attacks of 11 September 2001, the subsequent American involvement in wars in Afghanistan and Iraq and the associated economic downturn have all pushed the environment away from the forefront of Americas collective mind.


 


This was confirmed by a Missing In Action poll organized by the Gallup organization for Earth Day, Americas national day of environmental awareness, which celebrated its 34th anniversary this year. It found that Americans placed the environment 11th out of 12 major issues in terms of importance to them.


 


Only immigration worried Americans less, although given that issues prominence in the presidential debates, it is likely that Gallup might find the environment placed dead last if it re-polled the American people today.


 


Economy vs environment


 


Moreover, the poll found that 44 percent of Americans believed that the economy should take precedence over the environment. This probably explains why the Kerry campaign, which should find the environment a natural issue to focus on, has only seemed to mention the issue in certain areas.


 


The Kerry campaign has made jobs a central issue in the campaign, and so does not want to set itself up for the accusation that its support for environmental policies would cost American workers their jobs.


 


This can be seen in the Kerry campaigns schizophrenic approach to the global warming issue.


 


On Friday 19 August, the campaign issued a document aimed at keeping the West Virginian coal industry open. It included the words, John Kerry and John Edwards believe that the Kyoto  Protocol is not the answer.


 


The near-term emission reductions it would require of the United States are infeasible, while the long-term obligations imposed on all nations are too little to solve the problem.


 


But on 24 August, The Journal Times of Racine, Wisconsin, published an account of John Edwards visit to the town the day before. According to the paper, Edwards lamented Americas failure to join the Kyoto treaty. It seems the Kerry-Edwards campaign opposes Kyoto when coal miners votes are at stake but supports it in other areas. The context in which John Kerry raised the issue during the Presidential debates was that of foreign relations, not the environment.


 


The Bush administrations stance on the issue is only marginally more coherent. The President has theoretically opposed American involvement in Kyoto since early 2001, but America continues to send vast armies of bureaucrats to the regular Kyoto conferences and the nations signature remains on the treaty.


 


There are other considerations. American Enterprise Institute scholar Stephen Hayward points out that, in America at least, environmental spending has followed Greshams Law, which states that bad money drives out good.


 


He points to a campaign around Earth Day this year that sought to outlaw disposable diapers as a case of the public looking askance at an environmental movement seemingly increasingly divorced from reality.


 


Barring a major ecological disaster or electricity black-Green lawns, but the focus is on the White House outs, it is unlikely the issue will force its way back on to the electoral agenda by 2 November. When Americans vote, it will be literally true that the environment is the last thing on their minds.

Activists, not global warming, a third-world threat

by William Yeatman on October 21, 2004

in Politics, Science

A coalition of environmental activists called this week for rich countries to do more to control global warming and to help poor nations cope with the alleged effects of climate change.

The irony, of course, is their activism, not global warming, is the real threat. The activist groups, including Greenpeace, Friends of the Earth, Oxfam and ActionAid, issued a report calling for cuts in greenhouse gas emissions far more stringent than those called for by the international global warming treaty known as the Kyoto protocol.


They also want industrialized countries to subsidize poor countries adaptation to global warming to the tune of $73 billion per year, a sum on par with what industrialized countries now pay in subsidies to their domestic fossil fuel industries, according to the report.


Keep in mind that the Kyoto protocol, rejected by the U.S. Senate, President Bush and even Sen. John Kerry, only called for cuts in greenhouse gas emissions in the U.S. of about 7 percent below 1990 levels cuts that the Clinton-administration Department of Energy estimated could raise electricity prices 86 percent and gasoline prices 53 percent.


Greenpeace and company now want greenhouse gas emissions to be cut by 60-80 percent from 1990 levels cuts that would probably be economically devastating to the developed world.


The activists recipe for solving global warming thus appears to be, first, to kill off economic development in the developed world and, then, to have the developed world send what money it has left over to the developing world. Its not clear, though, that an economically crippled developed world would be able or willing to subsidize poor countries, leaving those countries forever impoverished.


While no one knows whether or to what extent humans may or may not be affecting global climate, climate change is a known and natural fact. The advantage that humans have over other species is that we can use our intelligence and wealth to adapt to changes in climate. Air conditioning, irrigation, desalinization are examples of human ingenuity overcoming otherwise inhospitable or uncomfortable climactic conditions. But harnessing technology to overcome climate challenges requires money something that is often in short supply in poor countries.


And, sadly, the environmental activists seem to be doing their best to make sure that poor countries stay poor.


For example, in a Jan. 22 media release, the activist Rainforest Action Network (RAN) declared victory in its campaign to transform the environmental practices of the worlds largest financial institution, Citigroup.


Now Citigroup doesnt have the sort of environmental practices typically associated with manufacturing and chemical industries. But Citigroup does make loans for economic and industrial development. After a four-year-long campaign, the RAN pressured Citigroup to restrict its lending practices in the developing world, including: not lending to projects that might adversely impact natural habitats; banning logging in tropical forests; avoiding investment in fossil fuel energy projects; and reporting greenhouse gas emissions from power projects in its lending portfolio.


Its an extremely regressive lending policy that, in effect, gives environmental activist groups a veto on Citigroup loans for development in poor countries and we all know how much environmental activists approve of development.


The Rainforest Action Network is not stopping with Citigroup. Last summer, RAN kicked off a campaign called Barbecue the Banks with a sidewalk barbecue in front of the San Francisco headquarters of Wells Fargo. Using Citigroup as the precedent, RAN hopes to intimidate Wells Fargo and other banks into agreeing to restrict their lending practices in poor countries.


Should the activists succeed in dictating restrictive bank lending practices in poor countries and I would bet that RAN is not yet done telling Citigroup how it may make loans dont expect too much economic development to occur there. As a result, poor countries will remain poor and will not be able to adapt as easily as wealthy countries to changes in climate.


Global warming may or may not be occurring. Humans may or may not be playing a role in any ongoing climate change. What is certain is that poor countries need economic development and environmental activists are blocking their way. The developing world doesnt need the Kyoto protocol. But it could use some sort of protection from global warming activists.


Steven Milloy is the publisher of JunkScience.com, an adjunct scholar at the Cato Institute and the author of “Junk Science Judo: Self-Defense Against Health Scares and Scams” (Cato Institute, 2001).

← Previous Entries

Next Entries →