By J. Alex Tarquinio
Published: October 12, 2008
EXCHANGE-TRADED funds that focus on alternative energy have proliferated in a very short time, and many of them have been mirroring the sharp swings in the oil markets.
"Essentially you are betting on which ones will get pushed around by oil prices the most," said Jeff Tjornehoj, a senior research analyst at Lipper.
Morningstar tracks three traditional mutual funds that focus on alternative energy — from the Calvert, Guinness Atkinson and Firsthand fund companies — but there are at least 16 ETF's that also focus on new power sources. And more than half of those ETF's were created this year.
Many of these ETF's focus on a narrow sliver of the industry, like solar or nuclear power or biofuels like ethanol. "I don't know of any mutual funds that are that granular yet," said Michael Herbst, lead natural-resources mutual fund analyst at Morningstar.
Tjornehoj said that over the long haul, alternative energy "might very well be the next big thing." But he added that this was still a fledgling industry and advised individual investors to proceed with caution. "It could be a long time before any one of these technologies replaces oil," he said.
The price of oil, meanwhile, has an outsize influence on the pricing of the alternative energy sector.
"Obviously, people aren't going to care as much about clean energy if oil is $10 a barrel," said Ed McRedmond, the senior vice president for portfolio strategies at Invesco PowerShares Capital Management, a large ETF company based in Wheaton, Illinois.
Paul Justice, ETF fund strategist at Morningstar, said he was concerned that many individual investors lacked the expertise to decide which technology might become dominant — like solar or wind power — and that it might even be one that didn't yet have a lot of publicly traded stocks, like geothermal or tidal energy.
But Justice said he could understand the popularity of one particular new flavor of ETF: wind power funds, which track wind power companies around the world. Two of these opened in the last four months and have garnered $83 million in assets between them.
Justice points out that many wind power companies — unlike solar power and ethanol businesses — are based in Europe, and that it is not always easy for Americans to buy their shares. "You don't want to own the second fiddle just because it's based in the United States," he said.
As the initial cash was pouring in, their share prices slumped, mimicking oil prices, which were also falling. The First Trust ISE Global Wind Energy Index fund has amassed more than $63 million in assets since it began trading in mid-June. As of Thursday, the shares of this ETF, which charges annual expenses of 0.6 percent, were down almost 55 percent since its inception.
PowerShares started the other wind power ETF over the summer. The fund, the PowerShares Global Wind Energy Portfolio, began trading in July, and has more than $20 million in assets. Through Thursday, the fund was down more than 51 percent; it charges 0.75 percent in annual expenses.
Three ETF's that focus on nuclear power have attracted more than $200 million in total assets since the first of them, Van Eck Nuclear Energy, began trading just over a year ago. In the third quarter, the fund was down 34 percent, and it has shed more than 52 percent from its inception in August 2007 through Thursday. It charges 0.65 percent in annual expenses.
Justice included the three nuclear power funds among the 16 alternative energy ETF's that he counted in the Morningstar database, though he acknowledged that nuclear power stocks might not be too appetizing to some alternative-energy investors.
He said these people might be drawn more to the PowerShares ETF's that track indexes created by WilderShares, a company based in Encinitas, California. WilderShares excludes nuclear power companies from its indexes.
One unusual facet of the indexes, which are called WilderHill indexes, is the way they weight companies based on how important alternative energy is to each of them.
For example, Robert Wilder, the company's founder and CEO, said a small, pure-play alternative energy stock like VeraSun Energy, an ethanol company in Sioux Falls, South Dakota, might have a bigger place in a WilderHill index than a large industrial company like Applied Materials, for which solar components are one part of its product mix.
Monday, 13 October 2008
National Trust: 16% of protected coastal habitat could be lost to erosion
Paul Eccleston
Last Updated: 12:01am BST 13/10/2008
They are the breathtaking landscapes and historic buildings which help define the south-west coast of England.
The familiar, rugged coastlines, cliffs and beaches of Devon, Cornwall, Dorset and Somerset are quintessentially English.
St Michael's Mount is of historic importance, but its harbour and causeway are at high risk from flooding
Ancient cliff top houses, pathways and sheltered harbours all provide clues to a rich maritime history.
But the National Trust, responsible for the care of special places across the country, warns many of its sites in the south-west are now at risk from sea level rise, flooding and erosion brought by climate change.
In a new report the Trust says 279 kilometres of coastline - more than 170 miles - could be affected by erosion, and 852 hectares of coastal sites are at risk of tidal flooding.
On NT land alone about 16 per cent of protected coastal habitat - Sites of Special Scientific Interest (SSSI) - could be lost to erosion or be changed irrevocably by flooding.
They include the internationally important lagoon on Brownsea Island in Poole Harbour - one of the views from the so-called Millionaires Row at nearby Sandbanks,
The report, Shifting shores in the South West, also identifies at least 142 Scheduled Ancient Monuments, 111 listed buildings and one historic garden within the risk zone.
It builds on a 2005 report into the long-term future of the coastline and the steps that need to be taken now to limit the damage flooding, higher seas and more frequent and ferocious storms will inflict.
The update identifies four areas where the impact will be greatest:
Wildlife: New large-scale habitats will have to be found to make up for the areas that will be lost to the sea.
Historic environment: Working out timescales for threatened historic buildings and ancient monuments
Economic costs: 10 per cent of NT properties such as cottages and farms which generate £1.3m annually are in vulnerable coastal locations in Devon and Cornwall.
Public access: 100 miles of public rights of way are or will be affected by coastal erosion and flooding - including the South West Coast Path.
Phil Dyke, coastal and marine adviser at the NT, said: "Our coast is changing, even in areas such as the south west where the perception of the coast is that the hard rock might offer us some protection.
"But we know from our research that some of the National Trust's coastline in the south west is either soft rock so vulnerable to erosion, or low-lying so vulnerable to flooding.
"The kinds of impacts that the National Trust is experiencing will be the same across much of the UK. But we need to look ahead and not just to the immediate future. In Shifting Shores we are considering what could happen in 20, 50 or 100 years time."
The NT's plan for managing the coast includes raising public awareness, simplifying decision making among different agencies, moving with the coast and the forces of nature and finding better ways of funding insurance and compensation schemes for to vulnerable communities.
Some of the best known sites at risk:
Westbury Court Garden is close to the River Severn in Gloucestershire, and is a rare and beautiful example of a Dutch Water Garden, dating back to the late 17th century. Due to its location, it faces a very real threat from flooding and sea water inundation.
Greenway, Agatha Christie's summer home, the boathouse featured in 'Dead Man's Folly', will be monitored for increased flooding and the consequent impact on access to the first floor. The building may have to be abandoned within 15 years.
Brownsea Island, an internationally important lagoon, provides a special habitat for many species of over-wintering and migrating birds. If sea levels continue to rise the lagoon could, at some point in the future, become inundated with sea water which would lead to the loss of this significant habitat.
St Michael's Mount is of significant historic and economic importance to Cornwall, but its location means its harbour and causeway are at high risk from flooding.
Last Updated: 12:01am BST 13/10/2008
They are the breathtaking landscapes and historic buildings which help define the south-west coast of England.
The familiar, rugged coastlines, cliffs and beaches of Devon, Cornwall, Dorset and Somerset are quintessentially English.
St Michael's Mount is of historic importance, but its harbour and causeway are at high risk from flooding
Ancient cliff top houses, pathways and sheltered harbours all provide clues to a rich maritime history.
But the National Trust, responsible for the care of special places across the country, warns many of its sites in the south-west are now at risk from sea level rise, flooding and erosion brought by climate change.
In a new report the Trust says 279 kilometres of coastline - more than 170 miles - could be affected by erosion, and 852 hectares of coastal sites are at risk of tidal flooding.
On NT land alone about 16 per cent of protected coastal habitat - Sites of Special Scientific Interest (SSSI) - could be lost to erosion or be changed irrevocably by flooding.
They include the internationally important lagoon on Brownsea Island in Poole Harbour - one of the views from the so-called Millionaires Row at nearby Sandbanks,
The report, Shifting shores in the South West, also identifies at least 142 Scheduled Ancient Monuments, 111 listed buildings and one historic garden within the risk zone.
It builds on a 2005 report into the long-term future of the coastline and the steps that need to be taken now to limit the damage flooding, higher seas and more frequent and ferocious storms will inflict.
The update identifies four areas where the impact will be greatest:
Wildlife: New large-scale habitats will have to be found to make up for the areas that will be lost to the sea.
Historic environment: Working out timescales for threatened historic buildings and ancient monuments
Economic costs: 10 per cent of NT properties such as cottages and farms which generate £1.3m annually are in vulnerable coastal locations in Devon and Cornwall.
Public access: 100 miles of public rights of way are or will be affected by coastal erosion and flooding - including the South West Coast Path.
Phil Dyke, coastal and marine adviser at the NT, said: "Our coast is changing, even in areas such as the south west where the perception of the coast is that the hard rock might offer us some protection.
"But we know from our research that some of the National Trust's coastline in the south west is either soft rock so vulnerable to erosion, or low-lying so vulnerable to flooding.
"The kinds of impacts that the National Trust is experiencing will be the same across much of the UK. But we need to look ahead and not just to the immediate future. In Shifting Shores we are considering what could happen in 20, 50 or 100 years time."
The NT's plan for managing the coast includes raising public awareness, simplifying decision making among different agencies, moving with the coast and the forces of nature and finding better ways of funding insurance and compensation schemes for to vulnerable communities.
Some of the best known sites at risk:
Westbury Court Garden is close to the River Severn in Gloucestershire, and is a rare and beautiful example of a Dutch Water Garden, dating back to the late 17th century. Due to its location, it faces a very real threat from flooding and sea water inundation.
Greenway, Agatha Christie's summer home, the boathouse featured in 'Dead Man's Folly', will be monitored for increased flooding and the consequent impact on access to the first floor. The building may have to be abandoned within 15 years.
Brownsea Island, an internationally important lagoon, provides a special habitat for many species of over-wintering and migrating birds. If sea levels continue to rise the lagoon could, at some point in the future, become inundated with sea water which would lead to the loss of this significant habitat.
St Michael's Mount is of significant historic and economic importance to Cornwall, but its location means its harbour and causeway are at high risk from flooding.
Thomas Cook promises investors it will outline its carbon footprint
Terry Macalister
The Guardian,
Monday October 13 2008
Thomas Cook has agreed to provide information on its carbon footprint after being "named and shamed" by investors last week, amid growing political clamour for change.
The travel group was one of more than 100 companies in the FTSE 250 list of leading companies on the London Stock Exchange that declined to reveal how they were trying to tackle global warming.
The reluctance of a large number of firms to respond to the annual survey by the Carbon Disclosure Project led 60 MPs to write to Gordon Brown demanding that carbon reporting should be mandatory.
Thomas Cook, InterContinental Hotels and waste management group Biffa are just some of the groups that have refused to participate in the study. A spokesman for the travel group told the Guardian that it would from now on support the scheme, which was set up by investors holding trillions of dollars of assets under management.
"We can confirm that we did respond to the Carbon Disclosure Project and in doing so explained that we were unable to take part for the current project, but would do so in future years," said a spokesman for Thomas Cook. "Given the year that the project was reporting on was the year of the merger of Thomas Cook and MyTravel, unfortunately we did not have a common set of measures for our newly formed group.
"We assured the Carbon Disclosure Project in our response in June 2008 that we have every intention to take part in the future. We are committed to operating in a responsible and sustainable way by minimising our negative and enhancing our positive environmental impact through cultural change and significant investment."
Nick Clegg, leader of the Liberal Democrats, and former environment ministers Michael Meacher and Elliot Morley are among the signatories to a letter to the prime minister expressing grave concern that the government has weakened a provision in the Climate Change Bill to force companies to disclose their carbon footprint.
"It is absolutely essential that we know how much CO2 companies are pumping into the atmosphere if we are to have any chance at all of combating the disastrous consequences of climatic change," said Morley, who has been working with companies and campaign groups that are part of the lobbying Aldersgate Group.
The Guardian,
Monday October 13 2008
Thomas Cook has agreed to provide information on its carbon footprint after being "named and shamed" by investors last week, amid growing political clamour for change.
The travel group was one of more than 100 companies in the FTSE 250 list of leading companies on the London Stock Exchange that declined to reveal how they were trying to tackle global warming.
The reluctance of a large number of firms to respond to the annual survey by the Carbon Disclosure Project led 60 MPs to write to Gordon Brown demanding that carbon reporting should be mandatory.
Thomas Cook, InterContinental Hotels and waste management group Biffa are just some of the groups that have refused to participate in the study. A spokesman for the travel group told the Guardian that it would from now on support the scheme, which was set up by investors holding trillions of dollars of assets under management.
"We can confirm that we did respond to the Carbon Disclosure Project and in doing so explained that we were unable to take part for the current project, but would do so in future years," said a spokesman for Thomas Cook. "Given the year that the project was reporting on was the year of the merger of Thomas Cook and MyTravel, unfortunately we did not have a common set of measures for our newly formed group.
"We assured the Carbon Disclosure Project in our response in June 2008 that we have every intention to take part in the future. We are committed to operating in a responsible and sustainable way by minimising our negative and enhancing our positive environmental impact through cultural change and significant investment."
Nick Clegg, leader of the Liberal Democrats, and former environment ministers Michael Meacher and Elliot Morley are among the signatories to a letter to the prime minister expressing grave concern that the government has weakened a provision in the Climate Change Bill to force companies to disclose their carbon footprint.
"It is absolutely essential that we know how much CO2 companies are pumping into the atmosphere if we are to have any chance at all of combating the disastrous consequences of climatic change," said Morley, who has been working with companies and campaign groups that are part of the lobbying Aldersgate Group.
We can all help airlines to be greener
By Roger Gardner
Published: October 13 2008 03:00
The Conservative party announcement, from its party conference in Birmingham, that it wished to scrap plans for a third runway at Heathrow airport shows the level of controversy about the country's future transport needs.
The decision will have been significantly influenced by environmental concerns, principally those of climate impacts but also of noise and local air pollution.
With sustainability at the heart of transport policy, it is necessary to understand the prospects for mitigating the environmental effects of the predicted strong growth in air transport.
The point raised in Birmingham was that fast train services can offer a way out of the problem. Because short-haul flights represent the bulk of air traffic, it is right to ask how far rail can be used to ease pressures.
Yet there is still no alternative for the long-haul flights at the core of the Heathrow business model. Moreover, short-haul flights will continue to be in demand, unless society is willing to lose the "right to fly" or accept much longer journey times.
Before settling down to write this, I conducted a rather unscientific survey around my office on the use of short-haul flights.
Even in these parlous times of higher mortgage rates, and rising prices, colleagues have run up a impressive number of air miles; a flight to Sardinia for one, while another has recently been to Amsterdam; a flight to Dublin and a trip to Rome to check out wedding venues for a third; all this seems to confirm that short-haul (and often low-cost) air travel is seen as a right rather than a luxury.
So what is to be done? Certainly, we should transfer capacity to rail where it is feasible, and environmentally better to do so. But that still leaves many longer journeys for which there is no viable and speedy alternative.
There is also the question of how to balance out society's expectations, economic benefits and environmental impacts.
Assuming these considerations can be reconciled, there seem to be three main ways to deliver cleaner air transport: by changing the price consumers pay, introducing new technologies and removing inefficiencies in the system.
Governments can alter pricing through taxes, charges and emissions trading and, if it is a matter of protecting an annual holiday to the sun, we are likely to swallow higher prices.
Business may also judge that the benefits of a trip outweight the added cost, although there is an increasing trend towards video conferencing as an alternative to air travel.
However, if economic measures are really to benefit the environment, they need to act as drivers for airlines to lower their environmental impact and to incentivise the industry to introduce cleaner and quieter technologies.
Amazing technological advances have already been delivered and the jet engine is an efficient machine.
But lead times for technologies and the rate they feed into fleets of aircraft are long and slow. This time lag means that, when a significant opportunity comes along, it is essential to capture every ounce of innovation.
Such an opportunity may be in the offing, as Airbus and Boeing contemplate replacements for their A320 and B737 short-haul aircraft families. It is essential that environmentally radical technologies are applied at an early stage, because these designs will lock in a certain level of carbon emissions for several decades and significantly affect aircraft noise and air quality metrics.
Short distance air travel also creates problems ofcongestion, because many flights compete for airspace and airport capacity in highly populated regions.
Regulators are getting to grips with this issue by aligning airspace blocks but there remains much to be done and the pressures continue to build.
Aside from these big influences, there are other challenges linked to delivery of efficient, short-haul travel, such as enhancing transport links.
But a critical factor is public sensitivity about environmental issues and our willingness to pay. We all have our part to play.
My own consists of working, through Omega, to come up with solid research solutions to help the industry and policy makers develop air transport with minimum environmental impacts. Roger Gardner is chief executive of Omega, a partnership of nine UK universities working to bring research knowledge on aviation sustainability to the industry and government www.omega.mmu.ac.uk
Copyright The Financial Times Limited 2008
Published: October 13 2008 03:00
The Conservative party announcement, from its party conference in Birmingham, that it wished to scrap plans for a third runway at Heathrow airport shows the level of controversy about the country's future transport needs.
The decision will have been significantly influenced by environmental concerns, principally those of climate impacts but also of noise and local air pollution.
With sustainability at the heart of transport policy, it is necessary to understand the prospects for mitigating the environmental effects of the predicted strong growth in air transport.
The point raised in Birmingham was that fast train services can offer a way out of the problem. Because short-haul flights represent the bulk of air traffic, it is right to ask how far rail can be used to ease pressures.
Yet there is still no alternative for the long-haul flights at the core of the Heathrow business model. Moreover, short-haul flights will continue to be in demand, unless society is willing to lose the "right to fly" or accept much longer journey times.
Before settling down to write this, I conducted a rather unscientific survey around my office on the use of short-haul flights.
Even in these parlous times of higher mortgage rates, and rising prices, colleagues have run up a impressive number of air miles; a flight to Sardinia for one, while another has recently been to Amsterdam; a flight to Dublin and a trip to Rome to check out wedding venues for a third; all this seems to confirm that short-haul (and often low-cost) air travel is seen as a right rather than a luxury.
So what is to be done? Certainly, we should transfer capacity to rail where it is feasible, and environmentally better to do so. But that still leaves many longer journeys for which there is no viable and speedy alternative.
There is also the question of how to balance out society's expectations, economic benefits and environmental impacts.
Assuming these considerations can be reconciled, there seem to be three main ways to deliver cleaner air transport: by changing the price consumers pay, introducing new technologies and removing inefficiencies in the system.
Governments can alter pricing through taxes, charges and emissions trading and, if it is a matter of protecting an annual holiday to the sun, we are likely to swallow higher prices.
Business may also judge that the benefits of a trip outweight the added cost, although there is an increasing trend towards video conferencing as an alternative to air travel.
However, if economic measures are really to benefit the environment, they need to act as drivers for airlines to lower their environmental impact and to incentivise the industry to introduce cleaner and quieter technologies.
Amazing technological advances have already been delivered and the jet engine is an efficient machine.
But lead times for technologies and the rate they feed into fleets of aircraft are long and slow. This time lag means that, when a significant opportunity comes along, it is essential to capture every ounce of innovation.
Such an opportunity may be in the offing, as Airbus and Boeing contemplate replacements for their A320 and B737 short-haul aircraft families. It is essential that environmentally radical technologies are applied at an early stage, because these designs will lock in a certain level of carbon emissions for several decades and significantly affect aircraft noise and air quality metrics.
Short distance air travel also creates problems ofcongestion, because many flights compete for airspace and airport capacity in highly populated regions.
Regulators are getting to grips with this issue by aligning airspace blocks but there remains much to be done and the pressures continue to build.
Aside from these big influences, there are other challenges linked to delivery of efficient, short-haul travel, such as enhancing transport links.
But a critical factor is public sensitivity about environmental issues and our willingness to pay. We all have our part to play.
My own consists of working, through Omega, to come up with solid research solutions to help the industry and policy makers develop air transport with minimum environmental impacts. Roger Gardner is chief executive of Omega, a partnership of nine UK universities working to bring research knowledge on aviation sustainability to the industry and government www.omega.mmu.ac.uk
Copyright The Financial Times Limited 2008
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