Tuesday, 23 September 2008
Glasgow firm signs US wind turbine deal
Published Date: 23 September 2008
A SCOTS firm has secured a £1 million order to supply wind turbine technology to the United States over two years.
Glasgow-based Macom Technologies builds sensors to monitor the performance of turbines and has already shipped some of the 750 components on order.The deal was signed with Clipper Windpower, which is building turbines across the US. An agreement between Clipper and BP could bring further investment to Macom in future.Macom's device fits into turbines to monitor lubricants for metal particles, which indicate wear. The company, formed in 1999, has ten employees and plans to take on a further two.Ashraf Mabrouk, a Macom director, said: "The deal helps establish Macom as a prime player in the wind energy sector as suppliers of specialised but critically important wear debris condition monitoring equipment."Jim Dehlsen, of Clipper Windpower, said deals with other Scottish companies could follow. He praised "Scotland's leadership in driving forward technologies in support of wind energy's global expansion".
Welsh biomass plant proposed
By Fiona Harvey
Published: September 23 2008 03:00
Plans for a biomass-burning power plant that could provide electricity for 50,000 homes in Wales were submitted yesterday by Welsh Power's subsidiary, CEC Generation. If given the go-ahead, the £140m plant near Newport, running on woodchip and energy crops, would be one of a handful of such power stations in the UK.
The government wants to encourage more such plants as an alternative to fossil fuels, but difficulties with finding sustainable and cheap sources of fuel, and worries over government subsidies, have held back their development. The 50MW plant would take about two years to build, the company said. The site was chosen for the ease of delivery of biomass through the nearby port.
Fiona Harvey
Copyright The Financial Times Limited 2008
Published: September 23 2008 03:00
Plans for a biomass-burning power plant that could provide electricity for 50,000 homes in Wales were submitted yesterday by Welsh Power's subsidiary, CEC Generation. If given the go-ahead, the £140m plant near Newport, running on woodchip and energy crops, would be one of a handful of such power stations in the UK.
The government wants to encourage more such plants as an alternative to fossil fuels, but difficulties with finding sustainable and cheap sources of fuel, and worries over government subsidies, have held back their development. The 50MW plant would take about two years to build, the company said. The site was chosen for the ease of delivery of biomass through the nearby port.
Fiona Harvey
Copyright The Financial Times Limited 2008
Jetion eyes North America
By David Blackwell
Published: September 23 2008 03:00
The addition of two production lines following flotation on Aim in the summer of last year helped Jetion, which makes solar cells in China's Jiangsu province, lift first-half turnover from $38.6m to $100.7m (£55m).
The company, which exports more than 80 per cent of its output to Europe, hopes to start selling in North America next year.
Pre-tax profits for the six months to June 30 were $12.1m, up from $2.8m.
The shares - pitched at 151p for the IPO, which raised £30m - closed up 1p at 79p. The company said it was considering further expansion .David Blackwell
Copyright The Financial Times Limited 2008
Published: September 23 2008 03:00
The addition of two production lines following flotation on Aim in the summer of last year helped Jetion, which makes solar cells in China's Jiangsu province, lift first-half turnover from $38.6m to $100.7m (£55m).
The company, which exports more than 80 per cent of its output to Europe, hopes to start selling in North America next year.
Pre-tax profits for the six months to June 30 were $12.1m, up from $2.8m.
The shares - pitched at 151p for the IPO, which raised £30m - closed up 1p at 79p. The company said it was considering further expansion .David Blackwell
Copyright The Financial Times Limited 2008
Chrysler May Use Batteries by A123
By NEAL E. BOUDETTE
Chrysler LLC, in a rush to develop new, fuel-efficient vehicles, is in advanced talks about using batteries made by A123 Systems Inc. in an electric car due to be launched by 2011, people familiar with the matter said.
Chrysler, which now depends on trucks, sport-utility vehicles and minivans for 75% of its sales, is scheduled to demonstrate its battery-powered car for the first time in public Tuesday.
A123, Watertown, Mass., is a seven-year-old company vying to break into the nascent market for lithium-ion battery packs for automobiles. A123 is in the running to supply batteries for the Chevrolet Volt, the electric car General Motors Corp. is developing.
A deal to supply Chrysler would give a boost to A123's business ahead of a planned initial public stock offering. It registered for the offering in August.
A spokeswoman for Chrysler said the company "has nothing to announce at this time" about suppliers for its electric car. An A123 spokesman declined to comment, noting the company is in a quiet period because of its registration for an IPO.
Chrysler has been keeping its work on electric cars under tight wraps. But in recent weeks, as GM's Volt drew heavy media attention, Chrysler management became concerned that the company was being left out of the increasing buzz about electric vehicles, people familiar with the matter said.
GM has poured millions of dollars into its Volt project and has hyped the car in television commercials, although it is still uncertain whether the batteries for the car will be available on time. The Volt is set for launch in late 2010.
Tuesday, Chrysler will also demonstrate the electric car in a presentation that will be broadcast to dealers across the country. The company is hoping to energize dealers who have been hit hard by the downturn in auto sales this year.
Chrysler, which was acquired a year ago by private-equity group Cerberus Capital Management LP, has been searching for partners to help it keep pace with GM and others in the race to launch high-tech cars that cut fuel consumption and greenhouse-gas emissions.
The company had originally thought it might be able to have a working electric car by the spring, people familiar with the matter said. But with Chrysler burning cash and its sales falling, Cerberus has pushed the company to focus on cutting expenses, they said. The auto maker's sales have sagged this year as high gas prices spooked American consumers away from large vehicles like trucks and SUVs. Although Chief Executive Robert Nardelli has slashed costs and sold off assets, Chrysler is still on track to lose money this year.
Chrysler's push to develop electric vehicles began before Cerberus took an 80.1% stake in the company in August 2007, people familiar with the matter said.
Write to Neal E. Boudette at neal.boudette@wsj.com
Chrysler LLC, in a rush to develop new, fuel-efficient vehicles, is in advanced talks about using batteries made by A123 Systems Inc. in an electric car due to be launched by 2011, people familiar with the matter said.
Chrysler, which now depends on trucks, sport-utility vehicles and minivans for 75% of its sales, is scheduled to demonstrate its battery-powered car for the first time in public Tuesday.
A123, Watertown, Mass., is a seven-year-old company vying to break into the nascent market for lithium-ion battery packs for automobiles. A123 is in the running to supply batteries for the Chevrolet Volt, the electric car General Motors Corp. is developing.
A deal to supply Chrysler would give a boost to A123's business ahead of a planned initial public stock offering. It registered for the offering in August.
A spokeswoman for Chrysler said the company "has nothing to announce at this time" about suppliers for its electric car. An A123 spokesman declined to comment, noting the company is in a quiet period because of its registration for an IPO.
Chrysler has been keeping its work on electric cars under tight wraps. But in recent weeks, as GM's Volt drew heavy media attention, Chrysler management became concerned that the company was being left out of the increasing buzz about electric vehicles, people familiar with the matter said.
GM has poured millions of dollars into its Volt project and has hyped the car in television commercials, although it is still uncertain whether the batteries for the car will be available on time. The Volt is set for launch in late 2010.
Tuesday, Chrysler will also demonstrate the electric car in a presentation that will be broadcast to dealers across the country. The company is hoping to energize dealers who have been hit hard by the downturn in auto sales this year.
Chrysler, which was acquired a year ago by private-equity group Cerberus Capital Management LP, has been searching for partners to help it keep pace with GM and others in the race to launch high-tech cars that cut fuel consumption and greenhouse-gas emissions.
The company had originally thought it might be able to have a working electric car by the spring, people familiar with the matter said. But with Chrysler burning cash and its sales falling, Cerberus has pushed the company to focus on cutting expenses, they said. The auto maker's sales have sagged this year as high gas prices spooked American consumers away from large vehicles like trucks and SUVs. Although Chief Executive Robert Nardelli has slashed costs and sold off assets, Chrysler is still on track to lose money this year.
Chrysler's push to develop electric vehicles began before Cerberus took an 80.1% stake in the company in August 2007, people familiar with the matter said.
Write to Neal E. Boudette at neal.boudette@wsj.com
Hutton makes case for coal and nuclear power
Business secretary tells Labour conference that the two controversial sources of energy are crucial for Britain's future
Nicholas Watt, chief political correspondent
guardian.co.uk,
Monday September 22 2008 09:17 BST
Britain needs to undergo a "renaissance in nuclear power", and coal will continue to be a "critically important fuel" for the country, the business secretary, John Hutton, said today.
In an outspoken speech, designed to put pressure on the Tories as they outline restrictions on coal-fired power stations, Hutton said that the two controversial sources of energy are crucial to ensure Britain retains a secure supply of energy.
Hutton said the international battle for energy security poses a threat to Britain's competitiveness and its "sovereignty as a nation".
In his speech to the Labour conference in Manchester, he added: "It means a renaissance in nuclear power. Low carbon, reliable, secure... And because energy security is a first thought, not an afterthought, I will not turn my back on another critical source of energy security for the UK: coal."
The business secretary said he understood that people felt passionate about coal. But he took a swipe at David Cameron, who has said he will ensure that a new generation of "unabated coal power plants" cannot be built by imposing a California-style emissions performance standard.
Hutton said: "I understand that people feel passionate about this issue. Others, like the Tories, see an opportunity for pandering. But coal is critically important for the UK. Flexible. Available. Reducing our reliance on imported gas."
Hutton's remarks show that Labour believes that Cameron could be vulnerable on energy as high oil prices and the wider global economic downturn make people wary of restrictions on fuel even if they are designed to help the environment.
Tony Blair believes he scored one of his greatest hits on Cameron on energy after the Tory leader described nuclear power as an "option of last resort". Blair said that government was about taking tough decisions and was not a multiple choice exam.
Cameron has since indicated that he would be prepared to allow a new generation of nuclear power stations, though he warns that he would not provide any "blank cheques".
Hutton said the Britain had to look beyond weathering the current economic storm to make changes — "emerging stronger and fitter to seize the new manufacturing opportunities in the green economy and global markets of tomorrow".
Nicholas Watt, chief political correspondent
guardian.co.uk,
Monday September 22 2008 09:17 BST
Britain needs to undergo a "renaissance in nuclear power", and coal will continue to be a "critically important fuel" for the country, the business secretary, John Hutton, said today.
In an outspoken speech, designed to put pressure on the Tories as they outline restrictions on coal-fired power stations, Hutton said that the two controversial sources of energy are crucial to ensure Britain retains a secure supply of energy.
Hutton said the international battle for energy security poses a threat to Britain's competitiveness and its "sovereignty as a nation".
In his speech to the Labour conference in Manchester, he added: "It means a renaissance in nuclear power. Low carbon, reliable, secure... And because energy security is a first thought, not an afterthought, I will not turn my back on another critical source of energy security for the UK: coal."
The business secretary said he understood that people felt passionate about coal. But he took a swipe at David Cameron, who has said he will ensure that a new generation of "unabated coal power plants" cannot be built by imposing a California-style emissions performance standard.
Hutton said: "I understand that people feel passionate about this issue. Others, like the Tories, see an opportunity for pandering. But coal is critically important for the UK. Flexible. Available. Reducing our reliance on imported gas."
Hutton's remarks show that Labour believes that Cameron could be vulnerable on energy as high oil prices and the wider global economic downturn make people wary of restrictions on fuel even if they are designed to help the environment.
Tony Blair believes he scored one of his greatest hits on Cameron on energy after the Tory leader described nuclear power as an "option of last resort". Blair said that government was about taking tough decisions and was not a multiple choice exam.
Cameron has since indicated that he would be prepared to allow a new generation of nuclear power stations, though he warns that he would not provide any "blank cheques".
Hutton said the Britain had to look beyond weathering the current economic storm to make changes — "emerging stronger and fitter to seize the new manufacturing opportunities in the green economy and global markets of tomorrow".
Nuclear and coal plants 'vital' to UK energy future
Robin Pagnamenta, Energy and Environment Editor
John Hutton, the Business Secretary, vowed yesterday to take on critics of new coal and nuclear power stations, arguing that their construction was vital to securing Britain's long-term energy needs.
Addressing the Labour Party Conference in Manchester, he said that an international battle for energy security was emerging as one of the most significant threats to both Britain's competitiveness and its sovereignty. He said that the country's growing reliance on imported gas from some of the world's most unstable regions was unacceptable and he called for a renaissance of nuclear power.
Mr Hutton, speaking before the expected announcement of a £12.4 billion takeover of British Energy by EDF tomorrow, said that he was
“determined to press all the buttons to get nuclear built in this country at the earliest opportunity ... And because energy security is a first thought, not an afterthought, I will not turn my back on another critical source of energy security for the UK - coal.”
He lambasted opponents of both fuels, including environmental campaigners and other political parties, which he said were “posturing” over energy policy. “Tories say ‘no' to new coal and send mixed messages on nuclear; Lib Dems say ‘no' to new coal and nuclear. No coal plus no nuclear equals no lights. No power. No future.”
The Business Secretary accepted that people had concerns about the contribution that new coal-fired power stations would make to climate change, but he argued that British emissions were capped by European Union legislation and that building new coal plants would make no difference overall.
“Additional emissions will have to be offset by reductions elsewhere,” he said, “so stopping the building of new coal-fired power stations would make no difference to the UK's total carbon emissions - but I think it would damage our energy security. So there is no sense in our turning our backs on coal. Let's keep cleaning it up, not ruling it out.”
Mr Hutton's remarks were condemned by John Sauven, the executive director of Greenpeace, who said that new coal-fired power stations could not be an option because of their huge contribution to climate change.
Mr Hutton's speech came as Westinghouse, the Japanese-owned nuclear reactor maker, published research claiming the British economy could receive a £30billion boost from the construction of new stations, including the creation of thousands of skilled engineering jobs.
David Powell, Westinghouse's UK vice-president, said that half of the total would come through the construction of new sites, a third from operating the plants and the rest from servicing.
The EDF takeover of British Energy will mean that the bulk of Britain's nuclear industry will pass into the hands of the French state-controlled utility giant. EDF has lifted its initial offer of 765p a share to 774p. It wants to use its acquisition of British Energy to oversee construction of four nuclear plants on existing UK sites.
John Hutton, the Business Secretary, vowed yesterday to take on critics of new coal and nuclear power stations, arguing that their construction was vital to securing Britain's long-term energy needs.
Addressing the Labour Party Conference in Manchester, he said that an international battle for energy security was emerging as one of the most significant threats to both Britain's competitiveness and its sovereignty. He said that the country's growing reliance on imported gas from some of the world's most unstable regions was unacceptable and he called for a renaissance of nuclear power.
Mr Hutton, speaking before the expected announcement of a £12.4 billion takeover of British Energy by EDF tomorrow, said that he was
“determined to press all the buttons to get nuclear built in this country at the earliest opportunity ... And because energy security is a first thought, not an afterthought, I will not turn my back on another critical source of energy security for the UK - coal.”
He lambasted opponents of both fuels, including environmental campaigners and other political parties, which he said were “posturing” over energy policy. “Tories say ‘no' to new coal and send mixed messages on nuclear; Lib Dems say ‘no' to new coal and nuclear. No coal plus no nuclear equals no lights. No power. No future.”
The Business Secretary accepted that people had concerns about the contribution that new coal-fired power stations would make to climate change, but he argued that British emissions were capped by European Union legislation and that building new coal plants would make no difference overall.
“Additional emissions will have to be offset by reductions elsewhere,” he said, “so stopping the building of new coal-fired power stations would make no difference to the UK's total carbon emissions - but I think it would damage our energy security. So there is no sense in our turning our backs on coal. Let's keep cleaning it up, not ruling it out.”
Mr Hutton's remarks were condemned by John Sauven, the executive director of Greenpeace, who said that new coal-fired power stations could not be an option because of their huge contribution to climate change.
Mr Hutton's speech came as Westinghouse, the Japanese-owned nuclear reactor maker, published research claiming the British economy could receive a £30billion boost from the construction of new stations, including the creation of thousands of skilled engineering jobs.
David Powell, Westinghouse's UK vice-president, said that half of the total would come through the construction of new sites, a third from operating the plants and the rest from servicing.
The EDF takeover of British Energy will mean that the bulk of Britain's nuclear industry will pass into the hands of the French state-controlled utility giant. EDF has lifted its initial offer of 765p a share to 774p. It wants to use its acquisition of British Energy to oversee construction of four nuclear plants on existing UK sites.
Electric Range Rover with zero emissions to be unveiled
A prototype Range Rover capable of going 200 miles on a single electric charge is to be unveiled this week.
By David Millward, Transport Editor Last Updated: 8:58PM BST 22 Sep 2008
According to the company, this car will offer swift acceleration and a high top speed, while costing 80 per cent less to run than a petrol equivalent
It has been designed by a team working in Oxford and could be on sale next year.
The bill for driving an environmentally friendly Range Rover will be a hefty one, with the prices ranging from £95,000 to £125,000.
However, unlike the car's conventional equivalents, the tax bill for running the car will be minimal.
Electric cars on the market, such as the G-Wizz have a range of around 50-60 miles - but are also on sale at a fraction of the proposed price for the Liberty Electric Range Rover.
It is the latest in a series of alternative powered cars being designed by the motor industry which has come under intense pressure to reduce emissions.
The European Union has told car makers that they must bring their average CO2 output down to 130 grams per kilometre by 2012.
According to the company, this car will offer swift acceleration and a high top speed, while costing 80 per cent less to run than a petrol equivalent.
Other innovations include roof mounted solar panels, which will provide additional charge for the batteries as well as powering some of the car's electrics while it is stopped.
Some versions will also have technology designed to extend the car's range even further.
The company behind the project has pledged to invest £30 million and said it will create 250 new manufacturing jobs - although where the jobs will be located has not been disclosed.
Its backers include Ian Taylor, a former science minister, and a number of motor design experts.
By David Millward, Transport Editor Last Updated: 8:58PM BST 22 Sep 2008
According to the company, this car will offer swift acceleration and a high top speed, while costing 80 per cent less to run than a petrol equivalent
It has been designed by a team working in Oxford and could be on sale next year.
The bill for driving an environmentally friendly Range Rover will be a hefty one, with the prices ranging from £95,000 to £125,000.
However, unlike the car's conventional equivalents, the tax bill for running the car will be minimal.
Electric cars on the market, such as the G-Wizz have a range of around 50-60 miles - but are also on sale at a fraction of the proposed price for the Liberty Electric Range Rover.
It is the latest in a series of alternative powered cars being designed by the motor industry which has come under intense pressure to reduce emissions.
The European Union has told car makers that they must bring their average CO2 output down to 130 grams per kilometre by 2012.
According to the company, this car will offer swift acceleration and a high top speed, while costing 80 per cent less to run than a petrol equivalent.
Other innovations include roof mounted solar panels, which will provide additional charge for the batteries as well as powering some of the car's electrics while it is stopped.
Some versions will also have technology designed to extend the car's range even further.
The company behind the project has pledged to invest £30 million and said it will create 250 new manufacturing jobs - although where the jobs will be located has not been disclosed.
Its backers include Ian Taylor, a former science minister, and a number of motor design experts.
Crisis must be turned to green benefit, scientist says
· Climate technology needs help, government told· Latest market intervention 'shows what can be done'
Terry Macalister
The Guardian,
Tuesday September 23 2008
Governments need to show the same boldness to intervene in the markets to kickstart a move to a low-carbon economy as they did when they helped the banks stave off financial crisis last week, a leading academic has demanded.
"Both require strong regulation for efficient economic outcomes," said Terry Barker, a climate change expert at Cambridge University, who fears the Lehman Brothers and HBOS problems foreshadow a global economic downturn.
Barker's concerns were backed up by one of the government's scientific advisers, who fears that a downturn could lead to a lack of investment in vital new sectors such as developing carbon capture and storage plants.
"When you have a downturn of this kind, it does lead to a disinvestment in this kind of technology," said Robert Watson, a former World Bank adviser who is now at the Department for Environment, Food and Rural Affairs.
There were marked similarities between the lack of transparency and action on complex lending risks that had wreaked havoc in the banking community and the kinds of dangers being stored up by corporate and political inaction over global warming, said Barker, the director of the centre for climate change mitigation research at Cambridge.
"Both threaten the economy with catastrophic collapse," added the economist, who has worked with the UN's Inter-Governmental Panel on Climate Change, and was speaking with Watson at the Entrepreneurship for a Zero Carbon Society conference at Cambridge University.
Barker believes the problems on Wall Street will take potential investment money out of the system. But he says a determined response by ministers could encourage the channelling of that cash into vital work on climate change.
He fears that governments and business leaders have massively underestimated the risks posed by rising sea levels and changing weather patterns - any costs associated with moving to a low-carbon economy were, he said, "negligible" compared with the costs of doing nothing.
The banking crisis meant the rules of engagement by governments had changed completely, said Barker. The same system of "force majeure" was needed to tackle climate change through new eco-taxes, and help to supplement carbon trading.
In the past, cost-benefit analyses had been applied to justify inaction on global warming, but this was inappropriate given the enormous scale of the social, environmental and other threats being faced. "The Amazon rainforest and coral reefs cannot be substituted by money. It's obvious, but it needs repeating," said Barker.
The Cambridge academic said EU carbon reduction targets were far too low and would have to be raised if the world was to stand a chance of tackling the problem. There needed to be a 40% reduction in carbon output by 2020, not the 20% target that was currently in place.
Watson said action was needed on all fronts if the world was to avert disaster - and Britain should be forging ahead with nuclear, carbon capture and storage (CCS), and renewables such as wind, to ensure energy supplies were retained while carbon emissions fell.
With regard to CCS, he said the world needed an equivalent of the Apollo space programme of the 1960s and 70s aimed at putting a man on the Moon. There should be 20 CCS prototypes developed at the same time - the possible $1bn (£500m) cost for each facility was tiny compared with the $300bn worth of fossil fuel subsidies or the trillions of pounds' worth of economic activity that the Stern Review had indicated would be endangered every year by inaction on climate change.
Terry Macalister
The Guardian,
Tuesday September 23 2008
Governments need to show the same boldness to intervene in the markets to kickstart a move to a low-carbon economy as they did when they helped the banks stave off financial crisis last week, a leading academic has demanded.
"Both require strong regulation for efficient economic outcomes," said Terry Barker, a climate change expert at Cambridge University, who fears the Lehman Brothers and HBOS problems foreshadow a global economic downturn.
Barker's concerns were backed up by one of the government's scientific advisers, who fears that a downturn could lead to a lack of investment in vital new sectors such as developing carbon capture and storage plants.
"When you have a downturn of this kind, it does lead to a disinvestment in this kind of technology," said Robert Watson, a former World Bank adviser who is now at the Department for Environment, Food and Rural Affairs.
There were marked similarities between the lack of transparency and action on complex lending risks that had wreaked havoc in the banking community and the kinds of dangers being stored up by corporate and political inaction over global warming, said Barker, the director of the centre for climate change mitigation research at Cambridge.
"Both threaten the economy with catastrophic collapse," added the economist, who has worked with the UN's Inter-Governmental Panel on Climate Change, and was speaking with Watson at the Entrepreneurship for a Zero Carbon Society conference at Cambridge University.
Barker believes the problems on Wall Street will take potential investment money out of the system. But he says a determined response by ministers could encourage the channelling of that cash into vital work on climate change.
He fears that governments and business leaders have massively underestimated the risks posed by rising sea levels and changing weather patterns - any costs associated with moving to a low-carbon economy were, he said, "negligible" compared with the costs of doing nothing.
The banking crisis meant the rules of engagement by governments had changed completely, said Barker. The same system of "force majeure" was needed to tackle climate change through new eco-taxes, and help to supplement carbon trading.
In the past, cost-benefit analyses had been applied to justify inaction on global warming, but this was inappropriate given the enormous scale of the social, environmental and other threats being faced. "The Amazon rainforest and coral reefs cannot be substituted by money. It's obvious, but it needs repeating," said Barker.
The Cambridge academic said EU carbon reduction targets were far too low and would have to be raised if the world was to stand a chance of tackling the problem. There needed to be a 40% reduction in carbon output by 2020, not the 20% target that was currently in place.
Watson said action was needed on all fronts if the world was to avert disaster - and Britain should be forging ahead with nuclear, carbon capture and storage (CCS), and renewables such as wind, to ensure energy supplies were retained while carbon emissions fell.
With regard to CCS, he said the world needed an equivalent of the Apollo space programme of the 1960s and 70s aimed at putting a man on the Moon. There should be 20 CCS prototypes developed at the same time - the possible $1bn (£500m) cost for each facility was tiny compared with the $300bn worth of fossil fuel subsidies or the trillions of pounds' worth of economic activity that the Stern Review had indicated would be endangered every year by inaction on climate change.
Number of firms reporting on emissions targets falls
Terry Macalister
The Guardian,
Tuesday September 23 2008
The number of top 500 global firms reporting their carbon emissions reduction targets to the investment community has fallen, but climate change is still rising fast up the corporate agenda, a new report claims.
The Carbon Disclosure Project (CDP), a scheme developed by 385 of the world's biggest investors holding assets worth $57tn (£31tn), says only 74% of leading companies have reported their strategy for reducing emissions this year, down from 76% a year earlier.
And while more than 80% of firms in the Standard & Poor's leading 500 listed US firms accept that climate change is a risk, only a third of them have plans to reduce pollution. The project's organisers believe the fall in the number of firms reporting on emissions cuts can be put down to a changing world economic order that has pitched more Asian companies into the top 500.
Chinese, Indian and other businesses are traditionally less aware of greenhouse gas issues because many of these countries are not obliged to make reductions in carbon under the Kyoto Protocol as they are in Europe.
Overall, more companies responded to the carbon disclosure project - 1,550 of the world's biggest corporations this time compared with the 1,217 that replied in 2007.
Paul Dickinson, chief executive of the CDP - which was developed to help investors understand their financial exposure to global warming - said: "With increased regulation on the horizon, investors are requiring this information to better understand the creditworthiness of companies in their portfolio and how climate change might affect their profitability."
Global corporations view climate change as a clear risk as well as an opportunity. But they are anxious about the lack of clarity around government regulation, which they admit is holding back investment, Dickinson added.
The only British companies in the top 12 rankings for a carbon disclosure index are Scottish and Southern, the gas and electricity utility, and the banking group Barclays. Others in the list include Japanese carmaker Nissan and the German chemicals group Bayer.
The Guardian,
Tuesday September 23 2008
The number of top 500 global firms reporting their carbon emissions reduction targets to the investment community has fallen, but climate change is still rising fast up the corporate agenda, a new report claims.
The Carbon Disclosure Project (CDP), a scheme developed by 385 of the world's biggest investors holding assets worth $57tn (£31tn), says only 74% of leading companies have reported their strategy for reducing emissions this year, down from 76% a year earlier.
And while more than 80% of firms in the Standard & Poor's leading 500 listed US firms accept that climate change is a risk, only a third of them have plans to reduce pollution. The project's organisers believe the fall in the number of firms reporting on emissions cuts can be put down to a changing world economic order that has pitched more Asian companies into the top 500.
Chinese, Indian and other businesses are traditionally less aware of greenhouse gas issues because many of these countries are not obliged to make reductions in carbon under the Kyoto Protocol as they are in Europe.
Overall, more companies responded to the carbon disclosure project - 1,550 of the world's biggest corporations this time compared with the 1,217 that replied in 2007.
Paul Dickinson, chief executive of the CDP - which was developed to help investors understand their financial exposure to global warming - said: "With increased regulation on the horizon, investors are requiring this information to better understand the creditworthiness of companies in their portfolio and how climate change might affect their profitability."
Global corporations view climate change as a clear risk as well as an opportunity. But they are anxious about the lack of clarity around government regulation, which they admit is holding back investment, Dickinson added.
The only British companies in the top 12 rankings for a carbon disclosure index are Scottish and Southern, the gas and electricity utility, and the banking group Barclays. Others in the list include Japanese carmaker Nissan and the German chemicals group Bayer.
Carbon capture viable by 2030 but needs £8bn to begin now
David Gow in Brussels
The Guardian,
Tuesday September 23 2008
One of Gordon Brown's pet energy projects - to build up to a dozen pilot plants to capture and store carbon dioxide as power stations burn coal to generate electricity - would require EU subsidies of as much as €10bn (£7.9bn) over the next few years, it emerged yesterday.
A study by the consultancy McKinsey into carbon capture and storage (CCS) showed that such plants could be economically viable by 2030 at the latest. But it would require substantial public subsidies to get 10-12 plants running by the EU target date of 2015.
They cost twice or three times as much as conventional coal plants: about €2bn for the 300 megawatt plants planned by the industry, which is refusing to go ahead without public subsidies.
CCS is highly controversial, with green campaigners split down the middle over the issue. It involves capturing and compressing the CO2, transporting it to sites such as disused oil and gas fields or deep saline aquifers, and permanently storing it there.
But McKinsey said that, with coal still likely to make up 60% of EU power generation by 2030, CCS could be a vital solution to ensuring security of energy supply and reducing greenhouse gas emissions.
It could reduce emissions by 400m tonnes a year by 2030, or a fifth of planned European savings. The consultants' report, published yesterday, showed that with an aggressive commercial push from the middle of the next decade, CCS costs could come down from as much as €90 for a tonne of CO2 initially, to about €30-45 in 2030 - or in line with expected carbon prices then.
At the report's launch, Chris Davies, a Liberal Democrat MEP and the European parliament's rapporteur on CCS, said a deal could be struck soon to supply the public subsidies needed to kickstart the demonstration plants.
His solution is to take the billions from a strategic reserve - worth up to €18bn - set aside under the EU's emissions trading scheme for the creation of new, "green" plants. He claimed a majority of MEPs on the environment committee would endorse his scheme early next month.
Davies said: "We need to put this financing mechanism in place very quickly, deliver it to developers, and do it at a European level. If we leave it to national capitals, I'm not confident the projects will go ahead, and time is already running out."
But he said the subsidies would have to be monitored; through the European Investment Bank, for example, which would run tenders for the pilot plants and ensure that the public was not being "fleeced".
Andris Piebalgs, EU energy commissioner, said he personally favoured the Davies scheme, but could not commit the entire European commission. "The technology could compete with nuclear, solar, wind and gas, and help combat climate change not only in Europe but China, India and the US," he said.
Senior French officials said the EU council of ministers, which so far has opposed Davies's scheme, was considering alternative funding, such as revenues from the auctioning of pollution permits under the emissions trading scheme or from national or EU budgets.
Lars Josefsson, the chief executive of the Swedish power producer Vattenfall - which is promoting a small pilot plant with the German gases group Linde - said a swift financing solution was vital: "The boards of companies are not allowed to use shareholders' money recklessly and rack up billions of losses. We will invest in CCS if the funding gap is bridged."
The Guardian,
Tuesday September 23 2008
One of Gordon Brown's pet energy projects - to build up to a dozen pilot plants to capture and store carbon dioxide as power stations burn coal to generate electricity - would require EU subsidies of as much as €10bn (£7.9bn) over the next few years, it emerged yesterday.
A study by the consultancy McKinsey into carbon capture and storage (CCS) showed that such plants could be economically viable by 2030 at the latest. But it would require substantial public subsidies to get 10-12 plants running by the EU target date of 2015.
They cost twice or three times as much as conventional coal plants: about €2bn for the 300 megawatt plants planned by the industry, which is refusing to go ahead without public subsidies.
CCS is highly controversial, with green campaigners split down the middle over the issue. It involves capturing and compressing the CO2, transporting it to sites such as disused oil and gas fields or deep saline aquifers, and permanently storing it there.
But McKinsey said that, with coal still likely to make up 60% of EU power generation by 2030, CCS could be a vital solution to ensuring security of energy supply and reducing greenhouse gas emissions.
It could reduce emissions by 400m tonnes a year by 2030, or a fifth of planned European savings. The consultants' report, published yesterday, showed that with an aggressive commercial push from the middle of the next decade, CCS costs could come down from as much as €90 for a tonne of CO2 initially, to about €30-45 in 2030 - or in line with expected carbon prices then.
At the report's launch, Chris Davies, a Liberal Democrat MEP and the European parliament's rapporteur on CCS, said a deal could be struck soon to supply the public subsidies needed to kickstart the demonstration plants.
His solution is to take the billions from a strategic reserve - worth up to €18bn - set aside under the EU's emissions trading scheme for the creation of new, "green" plants. He claimed a majority of MEPs on the environment committee would endorse his scheme early next month.
Davies said: "We need to put this financing mechanism in place very quickly, deliver it to developers, and do it at a European level. If we leave it to national capitals, I'm not confident the projects will go ahead, and time is already running out."
But he said the subsidies would have to be monitored; through the European Investment Bank, for example, which would run tenders for the pilot plants and ensure that the public was not being "fleeced".
Andris Piebalgs, EU energy commissioner, said he personally favoured the Davies scheme, but could not commit the entire European commission. "The technology could compete with nuclear, solar, wind and gas, and help combat climate change not only in Europe but China, India and the US," he said.
Senior French officials said the EU council of ministers, which so far has opposed Davies's scheme, was considering alternative funding, such as revenues from the auctioning of pollution permits under the emissions trading scheme or from national or EU budgets.
Lars Josefsson, the chief executive of the Swedish power producer Vattenfall - which is promoting a small pilot plant with the German gases group Linde - said a swift financing solution was vital: "The boards of companies are not allowed to use shareholders' money recklessly and rack up billions of losses. We will invest in CCS if the funding gap is bridged."
Climate sceptics have their head in the sand, says the Met Office
An apparent cooling trend is exaggerated by a record high temperature in 1998 caused by El Niño, experts say
David Adam, environment correspondent
guardian.co.uk,
Monday September 22 2008 17:40 BST
Global average temperature anomaly from 1975-2007, relative to the 1961-1990 average. The black line shows the annual figure. The red line shows the trend over the full 23 years. The blue lines show the varying rate of the trend over 10 year periods. Source: The Met Office
Climate sceptics such as Nigel Lawson who argue that global warming has stopped have their "heads in the sand", according to the UK's Met Office.
A recent dip in global temperatures is down to natural changes in weather systems, a new analysis shows, and does not alter the long-term warming trend.
The office says average temperatures have continued their rising trend over the last decade, and that humans are to blame.
In a statement published on its website, it says: "Anyone who thinks global warming has stopped has their head in the sand.
"The evidence is clear, the long-term trend in global temperatures is rising, and humans are largely responsible for this rise. Global warming does not mean that each year will be warmer than the last."
The new research confirms that the world has cooled slightly since 2005, but says this is down to a weather phenomena called La Niña, when cold water rises to the surface of the Pacific Ocean. Despite this effect, the office says, 11 of the last 13 years are the warmest ever recorded.
Vicky Pope of the Met Office said the new research was in response to high-profile claims made by Lawson the former chancellor, and others that the recent cooling showed that fears of climate change are overblown, and that temperatures are unlikely to rise as high as predicted.
She said: "I think it has confused people. We got a lot of emails asking whether global warming had stopped and it prompted us to look at the data again and try and understand the situation better."
The apparent cooling trend is exaggerated by a record high temperature in 1998 caused by a separate weather event, El Niño, she said. "You could look at what happened in 1998 and say that global warming accelerated and that's not true either.
"Any statistician will tell you that you can't just draw a straight line between two points, you need to look at the underlying trend."
Despite the recent cooling, average temperatures are still rising at 0.09C per decade, the office says - down from the record 0.33C per decade measured during the 1990s.
David Adam, environment correspondent
guardian.co.uk,
Monday September 22 2008 17:40 BST
Global average temperature anomaly from 1975-2007, relative to the 1961-1990 average. The black line shows the annual figure. The red line shows the trend over the full 23 years. The blue lines show the varying rate of the trend over 10 year periods. Source: The Met Office
Climate sceptics such as Nigel Lawson who argue that global warming has stopped have their "heads in the sand", according to the UK's Met Office.
A recent dip in global temperatures is down to natural changes in weather systems, a new analysis shows, and does not alter the long-term warming trend.
The office says average temperatures have continued their rising trend over the last decade, and that humans are to blame.
In a statement published on its website, it says: "Anyone who thinks global warming has stopped has their head in the sand.
"The evidence is clear, the long-term trend in global temperatures is rising, and humans are largely responsible for this rise. Global warming does not mean that each year will be warmer than the last."
The new research confirms that the world has cooled slightly since 2005, but says this is down to a weather phenomena called La Niña, when cold water rises to the surface of the Pacific Ocean. Despite this effect, the office says, 11 of the last 13 years are the warmest ever recorded.
Vicky Pope of the Met Office said the new research was in response to high-profile claims made by Lawson the former chancellor, and others that the recent cooling showed that fears of climate change are overblown, and that temperatures are unlikely to rise as high as predicted.
She said: "I think it has confused people. We got a lot of emails asking whether global warming had stopped and it prompted us to look at the data again and try and understand the situation better."
The apparent cooling trend is exaggerated by a record high temperature in 1998 caused by a separate weather event, El Niño, she said. "You could look at what happened in 1998 and say that global warming accelerated and that's not true either.
"Any statistician will tell you that you can't just draw a straight line between two points, you need to look at the underlying trend."
Despite the recent cooling, average temperatures are still rising at 0.09C per decade, the office says - down from the record 0.33C per decade measured during the 1990s.
Met Office says climate change deniers deluded
David Adam, environment correspondent
The Guardian,
Tuesday September 23 2008
Climate change sceptics such as Nigel Lawson who argue that global warming has stopped have their "heads in the sand", according to the Met Office.
A recent dip in global temperatures is down to natural changes in weather systems, a new analysis shows, and does not alter the long-term warming trend.
The office says average temperatures have continued to rise in the last decade, and that humans are to blame.
In a statement published on its website, it says: "Anyone who thinks global warming has stopped has their head in the sand. The evidence is clear, the long-term trend in global temperatures is rising, and humans are largely responsible for this rise. Global warming does not mean that each year will be warmer than the last."
The new research confirms that the world has cooled slightly since 2005, but says this is down to a weather phenomena called La Niña, when cold water rises to the surface of the Pacific Ocean. Despite this effect, the office says, 11 of the last 13 years were the warmest ever recorded.
Vicky Pope, of the Met Office, said the research was a response to claims made by Lawson, a former chancellor, and others that the recent cooling showed fears of climate change were overblown, and temperatures were unlikely to rise as high as predicted. She said: "It has confused people. We got a lot of emails asking whether global warming had stopped and it prompted us to look at the data again."
The apparent cooling trend was exaggerated by a record high in 1998 caused by a separate weather event, El Niño, she said. "You could look at what happened in 1998 and say that global warming accelerated, and that's not true either."
The Guardian,
Tuesday September 23 2008
Climate change sceptics such as Nigel Lawson who argue that global warming has stopped have their "heads in the sand", according to the Met Office.
A recent dip in global temperatures is down to natural changes in weather systems, a new analysis shows, and does not alter the long-term warming trend.
The office says average temperatures have continued to rise in the last decade, and that humans are to blame.
In a statement published on its website, it says: "Anyone who thinks global warming has stopped has their head in the sand. The evidence is clear, the long-term trend in global temperatures is rising, and humans are largely responsible for this rise. Global warming does not mean that each year will be warmer than the last."
The new research confirms that the world has cooled slightly since 2005, but says this is down to a weather phenomena called La Niña, when cold water rises to the surface of the Pacific Ocean. Despite this effect, the office says, 11 of the last 13 years were the warmest ever recorded.
Vicky Pope, of the Met Office, said the research was a response to claims made by Lawson, a former chancellor, and others that the recent cooling showed fears of climate change were overblown, and temperatures were unlikely to rise as high as predicted. She said: "It has confused people. We got a lot of emails asking whether global warming had stopped and it prompted us to look at the data again."
The apparent cooling trend was exaggerated by a record high in 1998 caused by a separate weather event, El Niño, she said. "You could look at what happened in 1998 and say that global warming accelerated, and that's not true either."
Climate change fears after German opt-out
By Chris Bryant in Berlin, Fiona Harvey in London and Tony Barber in Brussels
Published: September 22 2008 16:43
A German government decision to back an almost total exemption for industry from new rules that would force companies to pay for the carbon dioxide they emit threatens to undermine a key tenet of European Union climate policy, climate campaigners warn.
The decision is a victory for German industry, which feared European Commission proposals for an auction of carbon emission permits would cost billions of euros and restrict its ability to compete internationally.
Sigmar Gabriel: seeks establishment of special rules
Angela Merkel, chancellor, warned recently that although she supported the need to tackle climate change, she “could not support the destruction of German jobs through an ill-advised climate policy”.
Climate campaigners said the move would open the door to a slew of objections from other states seeking to protect their own key industries during the next phase of the EU emissions trading scheme (ETS).
“There are a lot of countries that want to protect their own industries without the economic arguments to back this up,” said Joris den Blanken, senior policy advisor at Greenpeace.
The European parliament’s industry committee last week voted to replace the current free distribution of carbon-dioxide permits with a mandatory auction between 2013 and 2020 in a bid to help cut European greenhouse gas emissions by 20 per cent from 1990 levels.
The proposals are likely to face a vote at a plenary session of the parliament later this year but must then be ratified by the heads of member states.
The German government is not alone in seeking opt- outs. Poland is anxious that auctioning could severely affect its power companies while Italy is pushing for free carbon permits for specific sectors.
After months of internal wrangling, Germany has accepted that from 2013, power companies, including those that construct new power plants, should take part in the auction process.
However, because this is expected to lead to higher electricity costs, the government is to insist that energy-intensive industries like aluminium producers should be compensated with free carbon permits.
Germany will also push for an exemption for large emitters like the steel industry, subject to these companies using the best available emission control technology.
Remaining companies would have their purchase of certificates capped at 20 per cent of total emissions.
The German government defends its stance by claiming there is a risk of carbon-emitting industries relocating to countries where they would be free to pollute.
“As long as European companies are governed by stricter climate protection regulations than their competitors in countries like China, we have to seek to establish special rules,” said Sigmar Gabriel, environment minister.
Copyright The Financial Times Limited 2008
Published: September 22 2008 16:43
A German government decision to back an almost total exemption for industry from new rules that would force companies to pay for the carbon dioxide they emit threatens to undermine a key tenet of European Union climate policy, climate campaigners warn.
The decision is a victory for German industry, which feared European Commission proposals for an auction of carbon emission permits would cost billions of euros and restrict its ability to compete internationally.
Sigmar Gabriel: seeks establishment of special rules
Angela Merkel, chancellor, warned recently that although she supported the need to tackle climate change, she “could not support the destruction of German jobs through an ill-advised climate policy”.
Climate campaigners said the move would open the door to a slew of objections from other states seeking to protect their own key industries during the next phase of the EU emissions trading scheme (ETS).
“There are a lot of countries that want to protect their own industries without the economic arguments to back this up,” said Joris den Blanken, senior policy advisor at Greenpeace.
The European parliament’s industry committee last week voted to replace the current free distribution of carbon-dioxide permits with a mandatory auction between 2013 and 2020 in a bid to help cut European greenhouse gas emissions by 20 per cent from 1990 levels.
The proposals are likely to face a vote at a plenary session of the parliament later this year but must then be ratified by the heads of member states.
The German government is not alone in seeking opt- outs. Poland is anxious that auctioning could severely affect its power companies while Italy is pushing for free carbon permits for specific sectors.
After months of internal wrangling, Germany has accepted that from 2013, power companies, including those that construct new power plants, should take part in the auction process.
However, because this is expected to lead to higher electricity costs, the government is to insist that energy-intensive industries like aluminium producers should be compensated with free carbon permits.
Germany will also push for an exemption for large emitters like the steel industry, subject to these companies using the best available emission control technology.
Remaining companies would have their purchase of certificates capped at 20 per cent of total emissions.
The German government defends its stance by claiming there is a risk of carbon-emitting industries relocating to countries where they would be free to pollute.
“As long as European companies are governed by stricter climate protection regulations than their competitors in countries like China, we have to seek to establish special rules,” said Sigmar Gabriel, environment minister.
Copyright The Financial Times Limited 2008
Report boosts European policy on CO2
By Tony Barber in Brussels
Published: September 22 2008 16:59
European advocates of trapping and storing carbon dioxide as a means of curbing power-plant emissions received a boost on Monday when an experts’ report said the technology could become commercially viable in less than 25 years.
The study by the McKinsey consultancy estimated that for new coal-fired plants, carbon capture and storage (CCS) costs would average €30-€45 (£24-£38, $44-$66) by 2030 for every ton of CO2 prevented from entering the atmosphere.
The report was a pioneering effort to calculate the economics of CCS, a still fledgling technology that aims to capture CO2 emitted from power plants and industrial sites, compress it and transport it to permanent storage sites deep underground or underwater.
Early European demonstration projects using CCS technology are forecast to cost €60-€90 per ton of CO2 saved, making them too expensive for private companies to operate commercially, the report said.
However, with analysts at Deutsche Bank, UBS and other institutions forecasting a carbon trading right price of €30-€48 per ton by 2030, CCS would at that time become a viable proposition in Europe, the report said.
In March 2007 European Union leaders committed to building up to 12 demonstration power plants that would incorporate CCS. They took the view that CCS, though untested, was almost certain to be a vital component of the EU’s battle against carbon-driven climate change.
Eighteen months later, EU governments, the European Commission and the European parliament have still not agreed on how to pay for the demonstration plants, which are supposed to be up and running by 2015.
A vote is due in the European parliament next month that could kick-start the funding process. Chris Davies, the MEP responsible for steering CCS legislation, said that about €10bn in EU funds would be needed for the plants.
Andris Piebalgs, the EU’s energy commissioner, said: “We must make fast progress on the financing of the demonstration projects.”
Warren Campbell, the McKinsey expert who wrote the report, said it would be important to get the demonstration plants going as soon as possible if the target date of 2030 were to be met, because it takes about six years to acquire permission and build a new coal power plant in Europe.
“CCS can be economically viable by 2030, with a sufficiently aggressive roll-out,” said Tomas Nauclér, another McKinsey expert.
The report cautioned that there were several potential obstacles to widespread use of CCS technology, such as a lack of certainty about how to transport and store CO2 under existing EU legislation. Moreover, some environmentalists have raised concerns about whether stored CO2 will remain isolated from the atmosphere in the long term.
Copyright The Financial Times Limited 2008
Published: September 22 2008 16:59
European advocates of trapping and storing carbon dioxide as a means of curbing power-plant emissions received a boost on Monday when an experts’ report said the technology could become commercially viable in less than 25 years.
The study by the McKinsey consultancy estimated that for new coal-fired plants, carbon capture and storage (CCS) costs would average €30-€45 (£24-£38, $44-$66) by 2030 for every ton of CO2 prevented from entering the atmosphere.
The report was a pioneering effort to calculate the economics of CCS, a still fledgling technology that aims to capture CO2 emitted from power plants and industrial sites, compress it and transport it to permanent storage sites deep underground or underwater.
Early European demonstration projects using CCS technology are forecast to cost €60-€90 per ton of CO2 saved, making them too expensive for private companies to operate commercially, the report said.
However, with analysts at Deutsche Bank, UBS and other institutions forecasting a carbon trading right price of €30-€48 per ton by 2030, CCS would at that time become a viable proposition in Europe, the report said.
In March 2007 European Union leaders committed to building up to 12 demonstration power plants that would incorporate CCS. They took the view that CCS, though untested, was almost certain to be a vital component of the EU’s battle against carbon-driven climate change.
Eighteen months later, EU governments, the European Commission and the European parliament have still not agreed on how to pay for the demonstration plants, which are supposed to be up and running by 2015.
A vote is due in the European parliament next month that could kick-start the funding process. Chris Davies, the MEP responsible for steering CCS legislation, said that about €10bn in EU funds would be needed for the plants.
Andris Piebalgs, the EU’s energy commissioner, said: “We must make fast progress on the financing of the demonstration projects.”
Warren Campbell, the McKinsey expert who wrote the report, said it would be important to get the demonstration plants going as soon as possible if the target date of 2030 were to be met, because it takes about six years to acquire permission and build a new coal power plant in Europe.
“CCS can be economically viable by 2030, with a sufficiently aggressive roll-out,” said Tomas Nauclér, another McKinsey expert.
The report cautioned that there were several potential obstacles to widespread use of CCS technology, such as a lack of certainty about how to transport and store CO2 under existing EU legislation. Moreover, some environmentalists have raised concerns about whether stored CO2 will remain isolated from the atmosphere in the long term.
Copyright The Financial Times Limited 2008
Efforts to Curtail Emissions Gain
More Firms Believe Emitting Gases Will Cost Money
By JEFFREY BALL
How Washington might crack down on global-warming emissions won't be clear until after the fall election. But this week will bring two signs that U.S companies believe change is on the way.
Monday, the nonprofit Carbon Disclosure Project will report that more multinational corporations believe emitting carbon dioxide and other greenhouse gases in the U.S. will soon start costing money.
On Thursday, the first program to slap a mandatory cap on greenhouse-gas emissions in the U.S. will swing into motion. Ten Northeastern states have joined together to limit emissions from power plants within their borders under a program called the Regional Greenhouse Gas Initiative.
Each year, those states will issue a limited number of permits allowing the power plants to emit carbon dioxide, the greenhouse gas that results from the burning of fuels such as coal and natural gas. The power plants will have to buy permits at a price determined by an auction. The first cap doesn't hit until next year, but the first auction for the permits will take place this week.
If U.S. companies are starting to see climate change as a serious business issue, though, they aren't sure how to respond.
Of the 321 companies in the Standard & Poor's 500-stock index that responded to the Carbon Disclosure Project's questionnaire this year, 81% said they see global warming as a risk, but 33% said they have come up with targets to curb their emissions.
Consider the lack of clarity in the Northeast emissions cap.
For now, it lacks much bite. The number of permits the 10 states plan to auction off for next year would allow more emissions -- not fewer -- than the plants are expected to emit. Planners assumed when they set the cap that emissions would have risen above it by the time it took effect, meaning the cap would force a cut. In fact, emissions have been dropping, in part because falling natural-gas prices have induced power plants to shift to that less-emitting fuel. So analysts expect low permit prices at this week's auction.
Even a small energy tax, however, could hurt Northeast power producers whose competitors in other states face no cap at all.
"We need to remove the imbalance as quickly as we can," said Donald McCloskey, director of environmental strategy and policy for Public Service Enterprise Group Inc., a New Jersey power company that will be hit by the cap. He added, "We need to transition quickly to a national program" to cap greenhouse-gas emissions. Why? To spread the pain.
Write to Jeffrey Ball at jeffrey.ball@wsj.com
By JEFFREY BALL
How Washington might crack down on global-warming emissions won't be clear until after the fall election. But this week will bring two signs that U.S companies believe change is on the way.
Monday, the nonprofit Carbon Disclosure Project will report that more multinational corporations believe emitting carbon dioxide and other greenhouse gases in the U.S. will soon start costing money.
On Thursday, the first program to slap a mandatory cap on greenhouse-gas emissions in the U.S. will swing into motion. Ten Northeastern states have joined together to limit emissions from power plants within their borders under a program called the Regional Greenhouse Gas Initiative.
Each year, those states will issue a limited number of permits allowing the power plants to emit carbon dioxide, the greenhouse gas that results from the burning of fuels such as coal and natural gas. The power plants will have to buy permits at a price determined by an auction. The first cap doesn't hit until next year, but the first auction for the permits will take place this week.
If U.S. companies are starting to see climate change as a serious business issue, though, they aren't sure how to respond.
Of the 321 companies in the Standard & Poor's 500-stock index that responded to the Carbon Disclosure Project's questionnaire this year, 81% said they see global warming as a risk, but 33% said they have come up with targets to curb their emissions.
Consider the lack of clarity in the Northeast emissions cap.
For now, it lacks much bite. The number of permits the 10 states plan to auction off for next year would allow more emissions -- not fewer -- than the plants are expected to emit. Planners assumed when they set the cap that emissions would have risen above it by the time it took effect, meaning the cap would force a cut. In fact, emissions have been dropping, in part because falling natural-gas prices have induced power plants to shift to that less-emitting fuel. So analysts expect low permit prices at this week's auction.
Even a small energy tax, however, could hurt Northeast power producers whose competitors in other states face no cap at all.
"We need to remove the imbalance as quickly as we can," said Donald McCloskey, director of environmental strategy and policy for Public Service Enterprise Group Inc., a New Jersey power company that will be hit by the cap. He added, "We need to transition quickly to a national program" to cap greenhouse-gas emissions. Why? To spread the pain.
Write to Jeffrey Ball at jeffrey.ball@wsj.com
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