Reuters
Published: October 19, 2008
By Matthew Scuffham
Oil major Royal Dutch Shell has denied a report that it has withdrawn from the UK wind energy sector by agreeing to sell its stake in a project off the Blackpool coast to partners Scottish Power and Denmark's Dong Energy.
The Sunday Times said Royal Dutch Shell had agreed to sell its stake in the 800 million pound ($1.39 billion) Cirrus Shell Flat Array, a 250 megawatt project.
"This article is completely wrong. We have not sold our stake," a spokesman for the group told Reuters.
However, he added that the project was under review because of safety concerns for aircraft in the area.
"The three parties are considering the next step with regard to the future of the Cirrus Array project due to unresolved aviation concerns," he said.
Monday, 20 October 2008
Kedco tests water for interest in clean energy
By John Murray Brown
Published: October 20 2008 03:00
Proponents of clean energy technology say the nascent industry is attracting lots of investor interest.
Their claim will be put to the test today when a small Irish company involved in food and wood waste electricity generation starts trading on Aim.
Kedco, which raised €16m (£12.4m) in a private placing in July, is priced at 17p a share, valuing the Cork-based company at £35m.
Donal Buckley, chief executive, hopes the listing will raise the company's profile and make it easier to raise funds, with a £250m pipeline of projects. He says he will be looking to raise new money in early 2009.
Kedco was founded in 2005 making it almost an old timer in this fast-evolving corner of the energy industry. It has linked with US and European technology companies to provide biomass waste energy for local authorities, food companies and agricultural operators in Ireland and the UK, using both wood waste gasification technology and a food composting process called "anaerobic digestion".
Kedco supplies the power generation plant, handles the sale of electricity, and in the UK earns money from the sale of credits known as ROCs or renewable obligation certificates. Green energy companies trade these for cash, allowing the traditional dirty industries to meet carbon emission commitments.
The Irish company also takes a fee for handling certain waste materials, and is able to sell some of the by-products of the process such as charcoal and compost.
Mr Buckley says bank debt accounts for about 65 per cent of funding. In recent talks with bankers, he says: "We got what we wanted - and some. Banks these days want to lend to cashflow."
Today's listing will not involve the issue of new shares. Retail investors make up two-thirds of the shareholder base.
Among the institutions, FBD, the Irish agricultural insurance company, owns about 35 per cent.
How much liquidity there will be in the stock remains to be seen. This has been a big problem for small Aim companies in the last couple of years.
While much of the green lobby's attention is on wind energy, Mr Buckley, an agricultural scientist by background, believes biomass has a much better future. With the new tighter European Union restrictions on the use of landfill, there is no supply problem.
All European governments are looking to reduce their dependence on conventional fossil-based energy generation.
Last week, for example, the Irish budget increased the renewables target from 33 per cent of overall energy supply to 44 per cent by 2020.
Kedco is on its own at the moment. "Sometimes I worry about the lack of competitors. We have early mover advantage but I know it won't last forever."
Copyright The Financial Times Limited 2008
Published: October 20 2008 03:00
Proponents of clean energy technology say the nascent industry is attracting lots of investor interest.
Their claim will be put to the test today when a small Irish company involved in food and wood waste electricity generation starts trading on Aim.
Kedco, which raised €16m (£12.4m) in a private placing in July, is priced at 17p a share, valuing the Cork-based company at £35m.
Donal Buckley, chief executive, hopes the listing will raise the company's profile and make it easier to raise funds, with a £250m pipeline of projects. He says he will be looking to raise new money in early 2009.
Kedco was founded in 2005 making it almost an old timer in this fast-evolving corner of the energy industry. It has linked with US and European technology companies to provide biomass waste energy for local authorities, food companies and agricultural operators in Ireland and the UK, using both wood waste gasification technology and a food composting process called "anaerobic digestion".
Kedco supplies the power generation plant, handles the sale of electricity, and in the UK earns money from the sale of credits known as ROCs or renewable obligation certificates. Green energy companies trade these for cash, allowing the traditional dirty industries to meet carbon emission commitments.
The Irish company also takes a fee for handling certain waste materials, and is able to sell some of the by-products of the process such as charcoal and compost.
Mr Buckley says bank debt accounts for about 65 per cent of funding. In recent talks with bankers, he says: "We got what we wanted - and some. Banks these days want to lend to cashflow."
Today's listing will not involve the issue of new shares. Retail investors make up two-thirds of the shareholder base.
Among the institutions, FBD, the Irish agricultural insurance company, owns about 35 per cent.
How much liquidity there will be in the stock remains to be seen. This has been a big problem for small Aim companies in the last couple of years.
While much of the green lobby's attention is on wind energy, Mr Buckley, an agricultural scientist by background, believes biomass has a much better future. With the new tighter European Union restrictions on the use of landfill, there is no supply problem.
All European governments are looking to reduce their dependence on conventional fossil-based energy generation.
Last week, for example, the Irish budget increased the renewables target from 33 per cent of overall energy supply to 44 per cent by 2020.
Kedco is on its own at the moment. "Sometimes I worry about the lack of competitors. We have early mover advantage but I know it won't last forever."
Copyright The Financial Times Limited 2008
Geely pushes for electric black cabs
By John Reed and Patti Waldmeir in Shanghai
Published: October 19 2008 22:32
Geely, the Chinese carmaker that co-owns the company that produces black London taxis, has met UK government officials about bringing electric-powered cabs to the UK capital.
“One of our ideas is to convert London taxis [to electric cars],” Li Shufu, the company’s chairman, told the Financial Times in an interview. “We are doing research on this project.”
Geely owns about 23 per cent of Manganese Bronze, the UK-based producer of black London cabs, and 51 per cent of a Shanghai-based joint venture that will produce the cars in China starting in December.
Mr Li said he had discussed the idea of electric taxis with Boris Johnson, London’s mayor, at the Beijing Games in August.
Earlier this year, Manganese Bronze signed a research and development agreement with Tanfield Electric Vehicles to develop all-electric plug-in taxis.
The company has seen its share price slump in recent weeks after Transport for London ordered hundreds of the company’s TX4 cabs off the streets after a series of engine fires.
Geely, like China’s other carmakers, is developing its own plug-in hybrid and electric cars, including an electric version of its Panda city car that it may seek to sell in Europe. Geely’s plan to build London taxis in Shanghai is one of a string of investments by Chinese companies seeking to apply low-cost production to iconic overseas assets.
Rival carmaker SAIC recently relaunched production of MG TF sports cars in Birmingham, and the group makes Roewe-brand cars in China largely based on tools and designs formerly owned by bankrupt MG Rover.
LTI Shanghai Automobile, the joint venture, plans to sell the Shanghai-built cabs to taxi operators, hotels and other buyers in China and overseas, eventually building 10,000 vehicles a year.
“We think the taxi can present a kind of British culture, which is traditional and iconic and elegant,” said Yu Wei, general manager. “British people have a really serious culture, and Chinese people are hard-working. If we can combine [British] culture with [Chinese] diligence, together we can produce a very good product.”
Copyright The Financial Times Limited 2008
Published: October 19 2008 22:32
Geely, the Chinese carmaker that co-owns the company that produces black London taxis, has met UK government officials about bringing electric-powered cabs to the UK capital.
“One of our ideas is to convert London taxis [to electric cars],” Li Shufu, the company’s chairman, told the Financial Times in an interview. “We are doing research on this project.”
Geely owns about 23 per cent of Manganese Bronze, the UK-based producer of black London cabs, and 51 per cent of a Shanghai-based joint venture that will produce the cars in China starting in December.
Mr Li said he had discussed the idea of electric taxis with Boris Johnson, London’s mayor, at the Beijing Games in August.
Earlier this year, Manganese Bronze signed a research and development agreement with Tanfield Electric Vehicles to develop all-electric plug-in taxis.
The company has seen its share price slump in recent weeks after Transport for London ordered hundreds of the company’s TX4 cabs off the streets after a series of engine fires.
Geely, like China’s other carmakers, is developing its own plug-in hybrid and electric cars, including an electric version of its Panda city car that it may seek to sell in Europe. Geely’s plan to build London taxis in Shanghai is one of a string of investments by Chinese companies seeking to apply low-cost production to iconic overseas assets.
Rival carmaker SAIC recently relaunched production of MG TF sports cars in Birmingham, and the group makes Roewe-brand cars in China largely based on tools and designs formerly owned by bankrupt MG Rover.
LTI Shanghai Automobile, the joint venture, plans to sell the Shanghai-built cabs to taxi operators, hotels and other buyers in China and overseas, eventually building 10,000 vehicles a year.
“We think the taxi can present a kind of British culture, which is traditional and iconic and elegant,” said Yu Wei, general manager. “British people have a really serious culture, and Chinese people are hard-working. If we can combine [British] culture with [Chinese] diligence, together we can produce a very good product.”
Copyright The Financial Times Limited 2008
Where the winds blow
John Vidal
The Observer,
Sunday October 19 2008
If Britain is to generate a third of its electricity from wind power, many upland areas will be blanketed in wind farms, but people in the lowlands may be shocked to find giant pylons carrying 400,000 volts across favourite areas of the countryside.
Bringing so much wind power from Wales, the Highlands and offshore demands a £5bn-£9bn upgrade and expansion of the high-voltage grid with larger, heavier pylons, up to 220ft high, according to National Grid, the company responsible for distributing electricity.
The existing transmission lines between Scotland, England and Wales will need to be upgraded and new undersea cables could be built down the east and west coasts from Scotland.
In addition, a new transmission line will probably have to be built in mid-Wales, possibly linking with the existing grid near Shrewsbury.
Protests and delays are inevitable. In Scotland, more than 17,000 people have objected to the 137-mile Beauly-Denny pylon route which would see 600 pylons crossing the Highlands.
The last major transmission line built in Britain in the early Nineties took more than 10 years from the planning to construction stages.
Burying the cables underground is 10-25 times more costly than overhead pylons, and not economically possible, says the National Grid.
The Observer,
Sunday October 19 2008
If Britain is to generate a third of its electricity from wind power, many upland areas will be blanketed in wind farms, but people in the lowlands may be shocked to find giant pylons carrying 400,000 volts across favourite areas of the countryside.
Bringing so much wind power from Wales, the Highlands and offshore demands a £5bn-£9bn upgrade and expansion of the high-voltage grid with larger, heavier pylons, up to 220ft high, according to National Grid, the company responsible for distributing electricity.
The existing transmission lines between Scotland, England and Wales will need to be upgraded and new undersea cables could be built down the east and west coasts from Scotland.
In addition, a new transmission line will probably have to be built in mid-Wales, possibly linking with the existing grid near Shrewsbury.
Protests and delays are inevitable. In Scotland, more than 17,000 people have objected to the 137-mile Beauly-Denny pylon route which would see 600 pylons crossing the Highlands.
The last major transmission line built in Britain in the early Nineties took more than 10 years from the planning to construction stages.
Burying the cables underground is 10-25 times more costly than overhead pylons, and not economically possible, says the National Grid.
UK wind farm plans on brink of failure
Last week Britain committed itself to cutting greenhouse gases by 80 per cent. This week Gordon Brown will claim the UK is now a world leader in wind power. An Observer investigation reveals his hopes could be blown wildly off course. No country has tried to switch so fast to renewable energy - but rising costs and technical problems mean that, without urgent action and cash, the targets cannot be met. John Vidal reports
John Vidal
The Observer,
Sunday October 19 2008
A maintenance boat works next to the turbines of the new Burbo Bank off shore wind farm in the mouth of the River Mersey. Photograph: Christopher Furlong/Getty Images
A major threat to Britain's ambitions for renewable energy will emerge this week when wind industry leaders admit that targets set for 2020 are looking increasingly unrealistic.
They will use a high-profile conference in London to warn Gordon Brown that there is little chance of achieving the government's goal - of wind generating one third of all UK electricity within 12 years - without a huge injection of public money.
It comes as an Observer investigation reveals that planning delays, long delivery times, escalating costs, 10-year hold-ups in connection to the national grid and technical problems in building offshore windfarms all threaten to derail Brown's ambitions. The result could be electricity shortages by 2020, failure to meet climate change and energy targets and possible hefty fines from Europe.
The developments will come as a blow to the government. Last week Ed Miliband, the new minister for climate change, said Britain would increase its target for reducing greenhouse gas emissions by 2050 from 60 to 80 per cent.
Brown will tell delegates at the annual conference of the British Wind Energy Association (BWEA) this week that the UK industry is now a world leader. But others will claim that there is a severe shortage of engineers and companies are reviewing their commitments to wind energy because of spiralling costs. Britain is legally committed to generating 15 per cent of all energy from renewables by 2020. This means that wind power, which presently contributes about 4 per cent of UK electricity, must expand to generate 36 per cent within 12 years.
No country has tried to switch its electricity supply so quickly on this scale, and to achieve it the industry will need to build nearly 15,000 turbines, generating 35 gigawatts (GW) of electricity, on land and at sea. Many experts say it is technically feasible to meet the targets, but there is a growing conviction that the plans were rushed through so quickly by the government that it will now take substantial new money and guarantees to work.
It is a very different story elsewhere. This week, in a vast warehouse in Berlin, blades for the world's largest wind turbine are being handcrafted by teams of people and robots. Each is 20 metres longer than the wing of the world's largest aeroplane, and when perched on top of 140-metre concrete towers in Belgium next year their tips will soar nearly 250 metres above the ground - higher than any building in Britain.
Ten years ago most wind turbines in Europe could barely power 200 homes, but technological advances have been so great that this single seven megawatt (MW) machine, known as the Enercon E-126, should provide nearly 20 million kilowatt hours of electricity a year - enough to power a town the size of Penzance.
There are others even bigger being planned in the US, but independent analysts say there is little chance that one of these turbines will be installed in Britain for many years. Many are deeply sceptical, saying that the government should not have put so much faith in wind power without making it easier for the industry to operate.
'The numbers do not add up,' said energy analyst Professor Ian Fells of Newcastle University. 'It is physically impossible for the industry to meet its target. The most that any country has ever built offshore is 350MW in a year. But they need to install nearly 10 times that in 12 years, and most will be far offshore. It means they will have to install hundreds a week. They cannot do it.'
Even Maria McCaffery, chief executive at the BWEA, has admitted for the first time that the industry might not reach the ambitious targets. 'It's tough, but just about achievable,' she said. 'But how close we can get to the target depends on what happens in the next few years. It's not guaranteed, but it's too soon to be defeatist.'
Paul Cowling, head of Npower Renewables, one of the two largest wind companies in Britain, with 4.5GW of wind power planned but not yet approved, said: 'With the right commitments from government, it's just about do-able. But we have never had targets like this before. Everything must be joined up and a lot can go wrong.'
A senior executive in a power company, who asked not to be named, added: 'There is absolutely no room for manoeuvre. The old nuclear power stations will be out of service, the new ones will not be on stream and big renewable projects like the proposed Severn barrage have not even been agreed, let alone built. Wind is the main plank of the government's energy policy over the next 12 years, but if anything at all goes wrong anywhere, then the targets will be missed and we are all in trouble.'
New studies warn of looming financial and supply problems. Last week the Carbon Trust, a government agency, warned that the steep rise in the price of building offshore farms could undermine the whole project. 'Currently the risk/return balance for offshore wind is not sufficiently attractive, and regulatory barriers would delay delivery well beyond 2020,' it said.
Tom Delay, the Trust's chief executive, added: 'Industry costs have become very, very expensive, and both government and companies need to work hard to tackle this. Without urgent action, there is a risk that little additional offshore wind power will be built by 2020.'
Cambridge Energy Research Associates says that Britain should expect a 20 per cent increase in offshore wind capital costs over the next few years on top of the 50 per cent increase in the past three years.
In August, energy consultancy Sinclair Knight Merz reported that most existing wind turbine manufacturers were booked solid for the next five years. 'The cost of offshore projects has doubled in five years,' it said.
That is not to mention the powerful opposition on the ground. Yesterday countryside protection groups warned that resistance to wind farms would be fierce and that planning delays, public inquiries and protests were inevitable. There are likely to be outcries in Cornwall, Wales, Yorkshire and Scotland when the scale of some of the farms is seen and it is understood that they will need hundreds of miles of 60-metre pylons to criss-cross some of Britain's most beautiful landscape.
Dr Frank Mastiaux, chief executive of the climate and renewables division of German electricity supplier E.ON, which is now building a 180MW offshore farm at Robin Rigg in the Solway Firth, said the UK targets were 'extremely challenging'. He added: 'Future wind farms will need to have thousands of turbines, each so big it would be like a football field turning on top of a steel mountain.'
One major problem is planning laws, which have been holding up dozens of projects for years.
Stephen Tinsdale, head of communications at Npower renewables, said: 'It can cost up to £200,000 just to put an application in, and you can expect it to take three to four years to go through planning. Two-thirds of all applications are refused. On top of that, there are conditions from the Ministry of Defence over radar and conditions by local authorities on when we can and cannot erect them. England has very few places left where you can build large farms. There are potential delays at almost every stage.'
New laws should make planning speedier for the industry, but the Infrastructure Planning Commission, which will handle applications for all large farms and should be set up next year, has not been tested yet either in practice or in the courts.
Another problem facing companies is getting connection to the National Grid. Some companies in Scotland have been told to join a 13-year queue and are being asked for deposits of millions of pounds before the grid will agree to connect them. Currently, 115 Scottish renewable schemes, totalling 9GW of mostly wind power, are waiting to plug into the grid before they can supply electricity. Some already have planning permission but have to wait many years to connect.
'It is plausible to meet the target, but it is very deeply challenging,' said a spokeswoman for National Grid. 'We have signed agreements to connect 16GW of renewable generation throughout Great Britain, but over 75 per cent of this total is stuck in the planning system.
'Urgent reform to the UK's planning laws and energy regulation are needed. We're fully aware that some dates are later than some people would like. We will try to work with developers to bring the dates forward wherever possible.'
But in an unpublished paper submitted to the government, National Grid says that, while it is possible to connect new offshore farms in time, the onshore target of 14GW of wind is 'not credible'. 'This is an area where we are not optimistic. We believe that only 12.9GW is credible,' says the paper.
The real prize for governments looking for major increases in wind capacity is a series of giant 5-6GW farms with hundreds of the biggest turbines 10 to 20 miles offshore. The first are being planned to be built after 2014 in the Bristol Channel, the Wash and off Wales and Yorkshire. But wind companies are having increasing doubts about their financial viability. While they are technically feasible, they are already more than twice the cost of onshore farms and the price is spiralling upwards.
Signals that UK offshore farms may not be profitable came in June when Shell pulled out of the consortium planning to build Britain's biggest offshore farm, the London Array in the Thames Estuary, in favour of developing more profitable wind projects elsewhere. Then last week the government of Abu Dhabi stepped in to help the project after Royal Dutch Shell withdrew.
Other developers are questioning whether they can justify the investment needed in Britain. Shell and BP are competing in the US to build the world's largest wind farms. 'Many are now recosting their plans and are attracted by other countries who are tempting them with tax breaks and a freedom to build what they want practically anywhere,' said one analyst.
Npower's Cowling said: 'We are going to need different boats, a whole fleet of vessels, offshore cable installers, helicopters. We are already getting close to our hurdle rates. If things get worse, it makes it a marginal decision whether we invest in them or not. It's all very risky. Because the UK is a difficult place to do business, the utility companies will just go elsewhere. We are not threatening to go, but if a utility finds a project which it can build quickly, it will go there. We are committed to the UK, but it is difficult.
'Until you get absolute consent from government, people will dither and it will take longer to install farms. Industry costs have become very, very expensive, and both government and companies need to work hard to tackle this.'
Potentially more serious is growing competition from other countries both for turbines and other machinery, as well as engineers. The market for wind is very strong, with more than £40bn invested worldwide last year, demand for turbines going through the roof as countries rush to meet climate change targets, and the very few manufacturers producing turbines now looking only for large orders. Emerging Energy Research, a leading research and advisory firm analysing clean energy markets, expects the international wind power industry to increase 500 per cent over 12 years.
Vestas, the world's biggest turbine maker, now has a £6bn order book and its turbine prices have risen 74 per cent in the past three years. China plans 100GW of wind power by 2020, a ten-fold increase from today. Texas alone plans more wind power than is expected to be installed in Britain in the next 20 years. The net result is that prices are escalating and orders for equipment taking longer and longer.
'Everyone wants wind power. If you ordered today you could possibly get a turbine in 2011. But you would have to be a serious order,' said an Enercon spokesman. 'It is a very good time for wind.'
Targets
2008 Wind to generate 3GW of electricity – enough to power several million homes
2010 Renewables to generate 10 per cent of all UK electricity, of which wind is expected to constitute 60 per cent. Wind to generate 36 per cent of UK electricity by 20202020 20 per cent of all EU energy to be produced from renewables
2050 UK to reduce carbon emissions by 80 per cent
John Vidal
The Observer,
Sunday October 19 2008
A maintenance boat works next to the turbines of the new Burbo Bank off shore wind farm in the mouth of the River Mersey. Photograph: Christopher Furlong/Getty Images
A major threat to Britain's ambitions for renewable energy will emerge this week when wind industry leaders admit that targets set for 2020 are looking increasingly unrealistic.
They will use a high-profile conference in London to warn Gordon Brown that there is little chance of achieving the government's goal - of wind generating one third of all UK electricity within 12 years - without a huge injection of public money.
It comes as an Observer investigation reveals that planning delays, long delivery times, escalating costs, 10-year hold-ups in connection to the national grid and technical problems in building offshore windfarms all threaten to derail Brown's ambitions. The result could be electricity shortages by 2020, failure to meet climate change and energy targets and possible hefty fines from Europe.
The developments will come as a blow to the government. Last week Ed Miliband, the new minister for climate change, said Britain would increase its target for reducing greenhouse gas emissions by 2050 from 60 to 80 per cent.
Brown will tell delegates at the annual conference of the British Wind Energy Association (BWEA) this week that the UK industry is now a world leader. But others will claim that there is a severe shortage of engineers and companies are reviewing their commitments to wind energy because of spiralling costs. Britain is legally committed to generating 15 per cent of all energy from renewables by 2020. This means that wind power, which presently contributes about 4 per cent of UK electricity, must expand to generate 36 per cent within 12 years.
No country has tried to switch its electricity supply so quickly on this scale, and to achieve it the industry will need to build nearly 15,000 turbines, generating 35 gigawatts (GW) of electricity, on land and at sea. Many experts say it is technically feasible to meet the targets, but there is a growing conviction that the plans were rushed through so quickly by the government that it will now take substantial new money and guarantees to work.
It is a very different story elsewhere. This week, in a vast warehouse in Berlin, blades for the world's largest wind turbine are being handcrafted by teams of people and robots. Each is 20 metres longer than the wing of the world's largest aeroplane, and when perched on top of 140-metre concrete towers in Belgium next year their tips will soar nearly 250 metres above the ground - higher than any building in Britain.
Ten years ago most wind turbines in Europe could barely power 200 homes, but technological advances have been so great that this single seven megawatt (MW) machine, known as the Enercon E-126, should provide nearly 20 million kilowatt hours of electricity a year - enough to power a town the size of Penzance.
There are others even bigger being planned in the US, but independent analysts say there is little chance that one of these turbines will be installed in Britain for many years. Many are deeply sceptical, saying that the government should not have put so much faith in wind power without making it easier for the industry to operate.
'The numbers do not add up,' said energy analyst Professor Ian Fells of Newcastle University. 'It is physically impossible for the industry to meet its target. The most that any country has ever built offshore is 350MW in a year. But they need to install nearly 10 times that in 12 years, and most will be far offshore. It means they will have to install hundreds a week. They cannot do it.'
Even Maria McCaffery, chief executive at the BWEA, has admitted for the first time that the industry might not reach the ambitious targets. 'It's tough, but just about achievable,' she said. 'But how close we can get to the target depends on what happens in the next few years. It's not guaranteed, but it's too soon to be defeatist.'
Paul Cowling, head of Npower Renewables, one of the two largest wind companies in Britain, with 4.5GW of wind power planned but not yet approved, said: 'With the right commitments from government, it's just about do-able. But we have never had targets like this before. Everything must be joined up and a lot can go wrong.'
A senior executive in a power company, who asked not to be named, added: 'There is absolutely no room for manoeuvre. The old nuclear power stations will be out of service, the new ones will not be on stream and big renewable projects like the proposed Severn barrage have not even been agreed, let alone built. Wind is the main plank of the government's energy policy over the next 12 years, but if anything at all goes wrong anywhere, then the targets will be missed and we are all in trouble.'
New studies warn of looming financial and supply problems. Last week the Carbon Trust, a government agency, warned that the steep rise in the price of building offshore farms could undermine the whole project. 'Currently the risk/return balance for offshore wind is not sufficiently attractive, and regulatory barriers would delay delivery well beyond 2020,' it said.
Tom Delay, the Trust's chief executive, added: 'Industry costs have become very, very expensive, and both government and companies need to work hard to tackle this. Without urgent action, there is a risk that little additional offshore wind power will be built by 2020.'
Cambridge Energy Research Associates says that Britain should expect a 20 per cent increase in offshore wind capital costs over the next few years on top of the 50 per cent increase in the past three years.
In August, energy consultancy Sinclair Knight Merz reported that most existing wind turbine manufacturers were booked solid for the next five years. 'The cost of offshore projects has doubled in five years,' it said.
That is not to mention the powerful opposition on the ground. Yesterday countryside protection groups warned that resistance to wind farms would be fierce and that planning delays, public inquiries and protests were inevitable. There are likely to be outcries in Cornwall, Wales, Yorkshire and Scotland when the scale of some of the farms is seen and it is understood that they will need hundreds of miles of 60-metre pylons to criss-cross some of Britain's most beautiful landscape.
Dr Frank Mastiaux, chief executive of the climate and renewables division of German electricity supplier E.ON, which is now building a 180MW offshore farm at Robin Rigg in the Solway Firth, said the UK targets were 'extremely challenging'. He added: 'Future wind farms will need to have thousands of turbines, each so big it would be like a football field turning on top of a steel mountain.'
One major problem is planning laws, which have been holding up dozens of projects for years.
Stephen Tinsdale, head of communications at Npower renewables, said: 'It can cost up to £200,000 just to put an application in, and you can expect it to take three to four years to go through planning. Two-thirds of all applications are refused. On top of that, there are conditions from the Ministry of Defence over radar and conditions by local authorities on when we can and cannot erect them. England has very few places left where you can build large farms. There are potential delays at almost every stage.'
New laws should make planning speedier for the industry, but the Infrastructure Planning Commission, which will handle applications for all large farms and should be set up next year, has not been tested yet either in practice or in the courts.
Another problem facing companies is getting connection to the National Grid. Some companies in Scotland have been told to join a 13-year queue and are being asked for deposits of millions of pounds before the grid will agree to connect them. Currently, 115 Scottish renewable schemes, totalling 9GW of mostly wind power, are waiting to plug into the grid before they can supply electricity. Some already have planning permission but have to wait many years to connect.
'It is plausible to meet the target, but it is very deeply challenging,' said a spokeswoman for National Grid. 'We have signed agreements to connect 16GW of renewable generation throughout Great Britain, but over 75 per cent of this total is stuck in the planning system.
'Urgent reform to the UK's planning laws and energy regulation are needed. We're fully aware that some dates are later than some people would like. We will try to work with developers to bring the dates forward wherever possible.'
But in an unpublished paper submitted to the government, National Grid says that, while it is possible to connect new offshore farms in time, the onshore target of 14GW of wind is 'not credible'. 'This is an area where we are not optimistic. We believe that only 12.9GW is credible,' says the paper.
The real prize for governments looking for major increases in wind capacity is a series of giant 5-6GW farms with hundreds of the biggest turbines 10 to 20 miles offshore. The first are being planned to be built after 2014 in the Bristol Channel, the Wash and off Wales and Yorkshire. But wind companies are having increasing doubts about their financial viability. While they are technically feasible, they are already more than twice the cost of onshore farms and the price is spiralling upwards.
Signals that UK offshore farms may not be profitable came in June when Shell pulled out of the consortium planning to build Britain's biggest offshore farm, the London Array in the Thames Estuary, in favour of developing more profitable wind projects elsewhere. Then last week the government of Abu Dhabi stepped in to help the project after Royal Dutch Shell withdrew.
Other developers are questioning whether they can justify the investment needed in Britain. Shell and BP are competing in the US to build the world's largest wind farms. 'Many are now recosting their plans and are attracted by other countries who are tempting them with tax breaks and a freedom to build what they want practically anywhere,' said one analyst.
Npower's Cowling said: 'We are going to need different boats, a whole fleet of vessels, offshore cable installers, helicopters. We are already getting close to our hurdle rates. If things get worse, it makes it a marginal decision whether we invest in them or not. It's all very risky. Because the UK is a difficult place to do business, the utility companies will just go elsewhere. We are not threatening to go, but if a utility finds a project which it can build quickly, it will go there. We are committed to the UK, but it is difficult.
'Until you get absolute consent from government, people will dither and it will take longer to install farms. Industry costs have become very, very expensive, and both government and companies need to work hard to tackle this.'
Potentially more serious is growing competition from other countries both for turbines and other machinery, as well as engineers. The market for wind is very strong, with more than £40bn invested worldwide last year, demand for turbines going through the roof as countries rush to meet climate change targets, and the very few manufacturers producing turbines now looking only for large orders. Emerging Energy Research, a leading research and advisory firm analysing clean energy markets, expects the international wind power industry to increase 500 per cent over 12 years.
Vestas, the world's biggest turbine maker, now has a £6bn order book and its turbine prices have risen 74 per cent in the past three years. China plans 100GW of wind power by 2020, a ten-fold increase from today. Texas alone plans more wind power than is expected to be installed in Britain in the next 20 years. The net result is that prices are escalating and orders for equipment taking longer and longer.
'Everyone wants wind power. If you ordered today you could possibly get a turbine in 2011. But you would have to be a serious order,' said an Enercon spokesman. 'It is a very good time for wind.'
Targets
2008 Wind to generate 3GW of electricity – enough to power several million homes
2010 Renewables to generate 10 per cent of all UK electricity, of which wind is expected to constitute 60 per cent. Wind to generate 36 per cent of UK electricity by 20202020 20 per cent of all EU energy to be produced from renewables
2050 UK to reduce carbon emissions by 80 per cent
Jobs blow revealed in wind energy report
By Fiona Harvey, Environment Correspondent
Published: October 20 2008 03:00
The massive planned expansion of renewable energy may produce far fewer jobs than the government has claimed, a study has found.
Producing enough renewable energy to meet government targets would create about 36,000 jobs in the wind energy sector by 2020, according to a study by Bain & Company for the British Wind Energy Association, to be published today.
Wind is expected to account for most of the renewable energy produced by 2020, as the potential for the expansion of other sources of energy - such as hydro-electricity, wave and tidal generation - is limited.
But the Bain estimate is far adrift of government claims.
Ed Miliband, secretary of state for energy and climate change, said last week that the offshore wind sector alone had "the potential to provide up to 70,000 new, green jobs" in the next decade.
In its renewable energy strategy, published over the summer, the government claimed it would create 160,000 new jobs by 2020.
The UK has committed, as part of a European Union proposal, to produce 15 per cent of its energy from renewable sources by 2050, which - given the difficulty of using renewables for heat and transport - would translate into generating 35 per cent to 40 per cent of the country's electricity from renewable sources by that date.
Achieving these targets will require the construction of about 27 gigawatts of wind generation capacity, the Bain study has found. The UK currently has about 2.2GW of capacity, and the wind industry employs about 5,000 people.
Most wind employees are in the construction, planning, maintenance and operation of wind turbines. About 40 per cent are employed in manufacturing wind turbines, an area in which the UK lags behind countries such as Germany and Denmark.
Attracting more turbine manufacturers to the UK would be crucial to generating more renewable energy jobs in the UK, said Markus Boettcher, author of the Bain report. He said that if a third of the wind turbines needed to make the government's targets were manufactured in the UK, that would create 36,000 jobs. If 50 to 60 per cent of the turbines were manufactured in the UK, and if a proportion were built for export, there could be 57,000 jobs in the sector by 2020 in the most optimistic of Bain's estimates. However, that would be hard to achieve as the UK's current wind turbine manufacturing base was "very moderate", Mr Boettcher said.
An installed capacity of 27GW of wind would require a total investment in the sector of about £26bn between now and 2020. At current energy prices, this would result in annual revenues of £8.2bn.
The UK's development of the wind sector was being held back by several factors, Mr Boettcher said. The most important were the lack of connections to the national grid from potential wind farms, which tend to be remote, and the delays faced by wind farm developers in gaining planning permission. The supply of labour was also a problem, Mr Boettcher said.
Copyright The Financial Times Limited 2008
Published: October 20 2008 03:00
The massive planned expansion of renewable energy may produce far fewer jobs than the government has claimed, a study has found.
Producing enough renewable energy to meet government targets would create about 36,000 jobs in the wind energy sector by 2020, according to a study by Bain & Company for the British Wind Energy Association, to be published today.
Wind is expected to account for most of the renewable energy produced by 2020, as the potential for the expansion of other sources of energy - such as hydro-electricity, wave and tidal generation - is limited.
But the Bain estimate is far adrift of government claims.
Ed Miliband, secretary of state for energy and climate change, said last week that the offshore wind sector alone had "the potential to provide up to 70,000 new, green jobs" in the next decade.
In its renewable energy strategy, published over the summer, the government claimed it would create 160,000 new jobs by 2020.
The UK has committed, as part of a European Union proposal, to produce 15 per cent of its energy from renewable sources by 2050, which - given the difficulty of using renewables for heat and transport - would translate into generating 35 per cent to 40 per cent of the country's electricity from renewable sources by that date.
Achieving these targets will require the construction of about 27 gigawatts of wind generation capacity, the Bain study has found. The UK currently has about 2.2GW of capacity, and the wind industry employs about 5,000 people.
Most wind employees are in the construction, planning, maintenance and operation of wind turbines. About 40 per cent are employed in manufacturing wind turbines, an area in which the UK lags behind countries such as Germany and Denmark.
Attracting more turbine manufacturers to the UK would be crucial to generating more renewable energy jobs in the UK, said Markus Boettcher, author of the Bain report. He said that if a third of the wind turbines needed to make the government's targets were manufactured in the UK, that would create 36,000 jobs. If 50 to 60 per cent of the turbines were manufactured in the UK, and if a proportion were built for export, there could be 57,000 jobs in the sector by 2020 in the most optimistic of Bain's estimates. However, that would be hard to achieve as the UK's current wind turbine manufacturing base was "very moderate", Mr Boettcher said.
An installed capacity of 27GW of wind would require a total investment in the sector of about £26bn between now and 2020. At current energy prices, this would result in annual revenues of £8.2bn.
The UK's development of the wind sector was being held back by several factors, Mr Boettcher said. The most important were the lack of connections to the national grid from potential wind farms, which tend to be remote, and the delays faced by wind farm developers in gaining planning permission. The supply of labour was also a problem, Mr Boettcher said.
Copyright The Financial Times Limited 2008
Winds Shift for Renewable Energy As Oil Price Sinks, Money Gets Tight
By TOM WRIGHT
The prospects of renewable-energy companies soared with oil prices, but the global credit crunch and the easing of energy costs have brought them back to earth with a thud.
Stronger players, such as Iberdrola of Spain, are buying wind farms from cash-strapped rivals.
With banks reluctant to lend and their stock prices tumbling, many green-energy concerns are struggling to find the long-term funding they need to expand in a capital-intensive industry.
In the past three months, global renewable-energy stocks tracked by New Energy Finance, a London-based consultancy, have dropped about 45%, compared with a 23% decline in the Dow Jones Industrial Average over the same period.
The sector's problems have been compounded by the skid in oil prices to below $70 a barrel last week from more than $147 in July. The sudden reversal in crude prices has removed -- at least temporarily -- a key rationale for investors to pump billions of dollars into alternative fuels, industry analysts say.
The result: At least in the short term, a slew of projects from palm-oil-based biodiesel plants in Indonesia and Malaysia to wind farms and solar projects across the U.S. and Europe may not be able to get funding.
Some companies are shelving plans for IPOs as long as stock markets remain weak and volatile. German solar-power company Schott Solar AG, for example, called off a $900 million initial public offering earlier this month, citing poor market conditions.
But some listed companies have little choice but to issue more shares given the difficulty of getting bank loans. Indian wind-turbine producer Suzlon Energy Ltd.'s stock has fallen more than 40% since late September, when it announced plans for a $380 million rights issue later this year to raise capital. Earlier, the company had told analysts it had lined up euro-denominated bank financing to fund its expansion plans.
U.S. wind-farm developers, which have commitments to build a record number of projects in 2009, are also scrambling for alternative sources of credit after the troubles of Lehman Brothers Holdings Inc. and American International Group Inc., both of which were big lenders to the green-energy sector, says Eric Silverman, a partner at law firm Milbank, Tweed, Hadley & McCloy LLP in New York.
"The credit crunch deals a negative blow to the whole [wind] sector because it's heavily dependent on debt financing," he says.
General Electric Co.'s GE Energy Financial Services, another major investor in U.S. wind-farm development, is cutting back outlays because the credit crisis has made it difficult to price investments. "This is a very tough market for any investor," says Andrew Katell, a spokesman for GE Energy Financial Services. "Everyone is impacted."
To be sure, many investors, including GE, still see renewable energy as a long-term opportunity to make money because of the apparent political will in the U.S. and Europe to reduce dependence on Middle Eastern oil and cut greenhouse-gas emissions. For example, the financial-bailout package approved by Congress this month also included provisions to extend federal tax breaks for wind energy by one year and solar by eight years.
For now, though, many analysts say tight credit is likely to force further consolidation in the sector, with large state-owned utilities and private-equity firms that can still access bank credit or are sitting on cash reserves buying up renewable projects from cash-strapped developers.
That would accelerate a trend seen recently in the U.S. in which big European players such as Iberdrola Renovables SA of Spain, the world's largest wind-farm developer, and Energias de Portugal SA purchased smaller U.S. wind companies.
"Over the next 12 months, large utilities have a competitive advantage," says Jonathan Johns, head of renewable-energy research at Ernst & Young in London.
Last month, German power-giant RWE AG agreed to pay $50 million to the British company Helius Energy PLC for a controlling stake in a 65-megawatt biomass-power plant in northern England. RWE will invest a total of $380 million in the wood-pulp-fueled plant, which is due to start operating in 2011.
Hudson Clean Energy Partners, a private-equity firm based in New York, announced last month that it was buying Helium Energy, a small Spanish wind and solar developer, for up to €100 million, or $134.5 million. Hudson, which was formed in 2006 by a former head of Goldman Sachs Group Inc.'s green-energy investment-banking team in the U.S., is buying the assets from Hemeretik S.L., a Spanish construction and property company that decided to ditch its renewable-energy business amid the economic downturn.
Some global-infrastructure funds are also dumping clean-energy assets to strengthen their balance sheets. Australian investment firm Babcock & Brown, whose shares have been pummeled amid concerns over its heavy debt, is planning to sell 2,000 megawatts of wind-farm assets in Europe this year, with large European utilities the likely buyers.
Investors are also likely to become more selective about which green projects they back, with those that don't depend on government subsidies likely to attract the most funding in the short term, industry analysts say.
That could slow development of cutting-edge alternative-energy technologies like celullosic biofuels, which have received private-equity funding but are still far from commercially viable. They will now have to compete with wind and solar for financing, says Angus McCrone, chief editor of research at New Energy Finance.
Private-equity firms "will now also have many companies from many sectors knocking on their doors," he adds, "especially while IPOs on the stock market are out of the question."
Write to Tom Wright at tom.wright@wsj.com
The prospects of renewable-energy companies soared with oil prices, but the global credit crunch and the easing of energy costs have brought them back to earth with a thud.
Stronger players, such as Iberdrola of Spain, are buying wind farms from cash-strapped rivals.
With banks reluctant to lend and their stock prices tumbling, many green-energy concerns are struggling to find the long-term funding they need to expand in a capital-intensive industry.
In the past three months, global renewable-energy stocks tracked by New Energy Finance, a London-based consultancy, have dropped about 45%, compared with a 23% decline in the Dow Jones Industrial Average over the same period.
The sector's problems have been compounded by the skid in oil prices to below $70 a barrel last week from more than $147 in July. The sudden reversal in crude prices has removed -- at least temporarily -- a key rationale for investors to pump billions of dollars into alternative fuels, industry analysts say.
The result: At least in the short term, a slew of projects from palm-oil-based biodiesel plants in Indonesia and Malaysia to wind farms and solar projects across the U.S. and Europe may not be able to get funding.
Some companies are shelving plans for IPOs as long as stock markets remain weak and volatile. German solar-power company Schott Solar AG, for example, called off a $900 million initial public offering earlier this month, citing poor market conditions.
But some listed companies have little choice but to issue more shares given the difficulty of getting bank loans. Indian wind-turbine producer Suzlon Energy Ltd.'s stock has fallen more than 40% since late September, when it announced plans for a $380 million rights issue later this year to raise capital. Earlier, the company had told analysts it had lined up euro-denominated bank financing to fund its expansion plans.
U.S. wind-farm developers, which have commitments to build a record number of projects in 2009, are also scrambling for alternative sources of credit after the troubles of Lehman Brothers Holdings Inc. and American International Group Inc., both of which were big lenders to the green-energy sector, says Eric Silverman, a partner at law firm Milbank, Tweed, Hadley & McCloy LLP in New York.
"The credit crunch deals a negative blow to the whole [wind] sector because it's heavily dependent on debt financing," he says.
General Electric Co.'s GE Energy Financial Services, another major investor in U.S. wind-farm development, is cutting back outlays because the credit crisis has made it difficult to price investments. "This is a very tough market for any investor," says Andrew Katell, a spokesman for GE Energy Financial Services. "Everyone is impacted."
To be sure, many investors, including GE, still see renewable energy as a long-term opportunity to make money because of the apparent political will in the U.S. and Europe to reduce dependence on Middle Eastern oil and cut greenhouse-gas emissions. For example, the financial-bailout package approved by Congress this month also included provisions to extend federal tax breaks for wind energy by one year and solar by eight years.
For now, though, many analysts say tight credit is likely to force further consolidation in the sector, with large state-owned utilities and private-equity firms that can still access bank credit or are sitting on cash reserves buying up renewable projects from cash-strapped developers.
That would accelerate a trend seen recently in the U.S. in which big European players such as Iberdrola Renovables SA of Spain, the world's largest wind-farm developer, and Energias de Portugal SA purchased smaller U.S. wind companies.
"Over the next 12 months, large utilities have a competitive advantage," says Jonathan Johns, head of renewable-energy research at Ernst & Young in London.
Last month, German power-giant RWE AG agreed to pay $50 million to the British company Helius Energy PLC for a controlling stake in a 65-megawatt biomass-power plant in northern England. RWE will invest a total of $380 million in the wood-pulp-fueled plant, which is due to start operating in 2011.
Hudson Clean Energy Partners, a private-equity firm based in New York, announced last month that it was buying Helium Energy, a small Spanish wind and solar developer, for up to €100 million, or $134.5 million. Hudson, which was formed in 2006 by a former head of Goldman Sachs Group Inc.'s green-energy investment-banking team in the U.S., is buying the assets from Hemeretik S.L., a Spanish construction and property company that decided to ditch its renewable-energy business amid the economic downturn.
Some global-infrastructure funds are also dumping clean-energy assets to strengthen their balance sheets. Australian investment firm Babcock & Brown, whose shares have been pummeled amid concerns over its heavy debt, is planning to sell 2,000 megawatts of wind-farm assets in Europe this year, with large European utilities the likely buyers.
Investors are also likely to become more selective about which green projects they back, with those that don't depend on government subsidies likely to attract the most funding in the short term, industry analysts say.
That could slow development of cutting-edge alternative-energy technologies like celullosic biofuels, which have received private-equity funding but are still far from commercially viable. They will now have to compete with wind and solar for financing, says Angus McCrone, chief editor of research at New Energy Finance.
Private-equity firms "will now also have many companies from many sectors knocking on their doors," he adds, "especially while IPOs on the stock market are out of the question."
Write to Tom Wright at tom.wright@wsj.com
Pakistan Secures China's Help to Build 2 Nuclear Reactors
OCTOBER 20, 2008
By MATTHEW ROSENBERG
Pakistan has secured China's help to build two new nuclear-power reactors in a deal being touted as a counterweight to rival India's recently concluded nuclear pact with the U.S.
But in his first official visit to Beijing last week, new Pakistan President Asif Ali Zardari apparently failed to nail down a firm Chinese commitment for another urgent need -- money to help replenish the country's sharply dwindling foreign reserves. With reserves at a six-year low, a Pakistani finance official said Saturday that Islamabad might seek assistance from the International Monetary Fund "as a last resort" to shore them up if it can't raise enough funds from other sources.
The nuclear deal with China would give Pakistan an additional 680 megawatts of power a year, or just over a quarter of the country's estimated current electricity shortfall.
China's leaders "do recognize Pakistan's need" for more energy, Foreign Minister Shah Mahmood Qureshi told reporters in Islamabad on Saturday.
But more importantly, Mr. Qureshi suggested, the deal would help restore the balance of power in South Asia following a much more comprehensive nuclear pact between India and the U.S., which gives New Delhi access to international atomic fuel and technology markets. In exchange, India has agreed to open its civilian reactors -- but not its military nuclear program -- to international inspections.
"China is one country that at international forums has clearly spoken against the discriminatory nature of that understanding" between Washington and New Delhi, Mr. Qureshi said, according to the Associated Press.
With ties between Washington and Islamabad strained over the faltering battle against Islamic militants along Pakistan's border with Afghanistan, Pakistan is increasingly turning to its long-time ally China for everything from help with propping up its teetering economy to boosting its woefully inadequate energy supplies.
Critics of the India-U.S. nuclear deal have argued that it could spark an arms race in South Asia by freeing up India's relatively small domestic atomic fuel supplies for use in the country's weapons program, a charge New Delhi denies.
Pakistani officials have pushed for a similar nuclear arrangement with the U.S. But Washington has repeatedly refused to discuss nuclear-energy cooperation with Pakistan, pointing to Islamabad's past record of clandestinely spreading atomic-weapons technology to countries such as Libya, Iran and North Korea through a smuggling ring run by scientist Abdul Qadeer Khan, the now-disgraced father of Pakistan's nuclear-arms program.
While Mr. Qureshi offered few details of the latest China-Pakistan nuclear deal, Chinese officials had previously said any agreement would be for peaceful energy purposes and would be supervised by the International Atomic Energy Agency, the United Nations' nuclear watchdog. The two new reactors are being added to the Chinese-built nuclear power plant in Chasma, a town in central Pakistan.
Despite the deep friendship, Mr. Zardari didn't appear to get an immediate pledge of help from China on the financial front.
Pakistan is seeking at least $5 billion to $6 billion from donors to shore up its dwindling foreign-exchange reserves -- down to about $7.75 billion from nearly $16.4 billion almost a year ago -- and to revive its ailing economy by boosting foreign investors' confidence.
Mr. Zardari is believed by diplomatic analysts to have asked China for $1 billion to $2 billion in a loan to Pakistan's central bank. Neither side has said whether any deal was struck, but Mr. Qureshi said Saturday that China would attend a so-called Friends of Pakistan donor conference next month in Abu Dhabi. He also said that China would invest $1 billion in various projects until June and that various Chinese organizations would invest in Pakistan's banking, mineral and industrial sectors.
Shaukat Tareen, an adviser to the prime minister, said that the country may seek the assistance of the International Monetary Fund if it fails to get the funds it needs. "We need $3 billion in the next few months, and efforts have been made to raise funds on time and we have received ample commitment from multilateral donor agencies and countries," Mr. Tareen said. "The next 30 to 45 days are crucial. ... We will seek assistance from the IMF as last resort."
While Pakistani authorities put the financing gap at $3 billion, the IMF believes it is $4 billion to $4.5 billion. Foreign-exchange reserves slipped to a six-year low of $7.749 billion in the week ended Oct. 11 as oil imports rose and the central bank sold dollars to prevent a sharp slide in the Pakistani rupee.
Mr. Tareen said the World Bank and the Asian Development Bank had agreed to give $1.5 billion each in the form of front-loaded concessional financing, with the money expected by June 30. In addition, the Islamic Development Bank and U.K.'s Department for International Development had agreed to double their assistance to $1 billion and £600 million ($1.04 billion), respectively.—Gordon Fairclough, C.R. Jayachandran and Neelabh Chaturvedi contributed to this article.
By MATTHEW ROSENBERG
Pakistan has secured China's help to build two new nuclear-power reactors in a deal being touted as a counterweight to rival India's recently concluded nuclear pact with the U.S.
But in his first official visit to Beijing last week, new Pakistan President Asif Ali Zardari apparently failed to nail down a firm Chinese commitment for another urgent need -- money to help replenish the country's sharply dwindling foreign reserves. With reserves at a six-year low, a Pakistani finance official said Saturday that Islamabad might seek assistance from the International Monetary Fund "as a last resort" to shore them up if it can't raise enough funds from other sources.
The nuclear deal with China would give Pakistan an additional 680 megawatts of power a year, or just over a quarter of the country's estimated current electricity shortfall.
China's leaders "do recognize Pakistan's need" for more energy, Foreign Minister Shah Mahmood Qureshi told reporters in Islamabad on Saturday.
But more importantly, Mr. Qureshi suggested, the deal would help restore the balance of power in South Asia following a much more comprehensive nuclear pact between India and the U.S., which gives New Delhi access to international atomic fuel and technology markets. In exchange, India has agreed to open its civilian reactors -- but not its military nuclear program -- to international inspections.
"China is one country that at international forums has clearly spoken against the discriminatory nature of that understanding" between Washington and New Delhi, Mr. Qureshi said, according to the Associated Press.
With ties between Washington and Islamabad strained over the faltering battle against Islamic militants along Pakistan's border with Afghanistan, Pakistan is increasingly turning to its long-time ally China for everything from help with propping up its teetering economy to boosting its woefully inadequate energy supplies.
Critics of the India-U.S. nuclear deal have argued that it could spark an arms race in South Asia by freeing up India's relatively small domestic atomic fuel supplies for use in the country's weapons program, a charge New Delhi denies.
Pakistani officials have pushed for a similar nuclear arrangement with the U.S. But Washington has repeatedly refused to discuss nuclear-energy cooperation with Pakistan, pointing to Islamabad's past record of clandestinely spreading atomic-weapons technology to countries such as Libya, Iran and North Korea through a smuggling ring run by scientist Abdul Qadeer Khan, the now-disgraced father of Pakistan's nuclear-arms program.
While Mr. Qureshi offered few details of the latest China-Pakistan nuclear deal, Chinese officials had previously said any agreement would be for peaceful energy purposes and would be supervised by the International Atomic Energy Agency, the United Nations' nuclear watchdog. The two new reactors are being added to the Chinese-built nuclear power plant in Chasma, a town in central Pakistan.
Despite the deep friendship, Mr. Zardari didn't appear to get an immediate pledge of help from China on the financial front.
Pakistan is seeking at least $5 billion to $6 billion from donors to shore up its dwindling foreign-exchange reserves -- down to about $7.75 billion from nearly $16.4 billion almost a year ago -- and to revive its ailing economy by boosting foreign investors' confidence.
Mr. Zardari is believed by diplomatic analysts to have asked China for $1 billion to $2 billion in a loan to Pakistan's central bank. Neither side has said whether any deal was struck, but Mr. Qureshi said Saturday that China would attend a so-called Friends of Pakistan donor conference next month in Abu Dhabi. He also said that China would invest $1 billion in various projects until June and that various Chinese organizations would invest in Pakistan's banking, mineral and industrial sectors.
Shaukat Tareen, an adviser to the prime minister, said that the country may seek the assistance of the International Monetary Fund if it fails to get the funds it needs. "We need $3 billion in the next few months, and efforts have been made to raise funds on time and we have received ample commitment from multilateral donor agencies and countries," Mr. Tareen said. "The next 30 to 45 days are crucial. ... We will seek assistance from the IMF as last resort."
While Pakistani authorities put the financing gap at $3 billion, the IMF believes it is $4 billion to $4.5 billion. Foreign-exchange reserves slipped to a six-year low of $7.749 billion in the week ended Oct. 11 as oil imports rose and the central bank sold dollars to prevent a sharp slide in the Pakistani rupee.
Mr. Tareen said the World Bank and the Asian Development Bank had agreed to give $1.5 billion each in the form of front-loaded concessional financing, with the money expected by June 30. In addition, the Islamic Development Bank and U.K.'s Department for International Development had agreed to double their assistance to $1 billion and £600 million ($1.04 billion), respectively.—Gordon Fairclough, C.R. Jayachandran and Neelabh Chaturvedi contributed to this article.
Climate change is 'faster and more extreme' than feared
Climate change is happening much faster than the world's best scientists predicted and will wreak havoc unless action is taken on a global scale, a new report warns.
By Paul Eccleston Last Updated: 1:39AM BST 20 Oct 2008
Arctic sea-ice in September 1979 and 2007, showing the biggest reduction since satellite surveillance began. Photo: Fugro NPA Ltd
wwf.org.uk
'Extreme weather events' such as the hot summer of 2003, which caused an extra 35,000 deaths across southern Europe from heat stress and poor air quality, will happen more frequently.
Britain and the North Sea area will be hit more often by violent cyclones and the predicted rise in sea level will double to more than a metre, putting vast coastal areas at risk from flooding.
The bleak report from WWF - formerly the World Wildlife Fund - also predicts crops failures and the collapse of eco systems on both land and sea.
And it calls on the EU to set an example to the rest of the world by agreeing a package of challenging targets for cutting greenhouse gas emissions to tackle the consequences of climate change and to keep any increase in global temperatures below 2C.
The agency says that the 2007 report from the Intergovernmental Panel on Climate Change (IPCC) - a study of global warming by 4,000 scientists from more than 150 countries which alerted the world to the possible consequences of global warming - is now out of date.
WWF's report, Climate Change: Faster, stronger, sooner, has updated all the scientific data and concluded that global warming is accelerating far beyond the IPCC's forecasts.
As an example it says the first 'tipping point' may have already been reached in the Arctic, where sea ice is disappearing up to 30 years ahead of IPCC predictions and may be gone completely within five years - something that hasn't occurred for a million years.
It could result in rapid and abrupt climate change rather than the gradual changes forecast by the IPCC.
The findings include:
* Global sea level rise could more than double from the IPCC's estimate of 0.59m by the end of the century.
* Natural carbon sinks, such as forests and oceans, are losing their ability to absorb CO2 from the atmosphere faster than expected.
* Rising temperatures have already led to a major reduction in food crops resulting in losses of 40m tonnes of grain per year.
* Marine ecosystems in the North and Baltic Sea are being exposed to the warmest temperatures measured since records began.
* The number and intensity of extreme cyclones over the UK and North Sea are projected to increase, leading to increased wind speeds and storm-related losses over Western and Central Europe.
The report was issued to coincide with a meeting of EU Environment Ministers today to discuss new laws aimed at tackling climate change. Some countries, including Italy and Poland, have already rejected proposals for higher cuts in emissions claiming they are unaffordable and unrealistic when many countries are facing recession.
The UK is the only country so far to commit to a legally binding 80 per cent cut in emissions by 2050 which the Government claims can be achieved by a switch to renewable energy sources - such as wind and wave - combined with a new generation of nuclear power stations.
In the report WWF urges the EU to commit to a reduction target of at least 30 per cent below 1990 levels by 2020 without relying on offsetting overseas and to provide financial support so developing countries can cut their own emissions and prepare for unavoidable impacts of climate change.
WWF-UK's Head of Climate Change, Dr. Keith Allott, said: "Climate change is a major challenge to the future of mankind and the environment, and this sobering overview highlights just how critical it is that EU environment ministers, who are meeting today to discuss EU legislation to tackle climate change, commit to a strong climate and energy package, in order to ensure a low carbon future.
"If the European Union wants to be seen as leader at UN talks in Copenhagen next year, and to help secure a strong global deal to tackle climate change after 2012, then it must stop shirking its responsibilities and commit to real emissions cuts within Europe."
The report has been endorsed by Professor Jean-Pascal van Ypersele, the newly elected Vice Chair of the IPCC, who said: "It is clear that climate change is already having a greater impact than most scientists had anticipated, so it's vital that international mitigation and adaptation responses become swifter and more ambitious."
Hurricanes 'can reduce CO2 levels'
Devastating hurricanes and typhoons could have one major benefit: reducing the amount of carbon in the atmosphere.
By Kate Devlin Last Updated: 7:15PM BST 19 Oct 2008
Scientists found that the storms act as a natural form of "carbon capture" by helping to trap carbon dioxide deep at the bottom of the ocean.
The more carbon dioxide is released into the atmosphere, the greater the number of strength of such storms, the study also suggests, although they will never rise to levels enough to reduce the current rate of global warming, the researchers warn.
However, the breakthrough will help scientists to improve their understanding of how the earth reacts to greenhouse gases and to tailor forecasts of the cycle more accurately.
The new study found that tropical cyclones, the umbrella term for hurricanes and typhoons, act as a counterbalance to increasing levels of carbon in the atmosphere.
These can be caused naturally, by events such as the eruption of volcanoes, as well as by man-made pollution.
The cyclones create large-scale floods which carry vast amounts of carbon, trapped in soil and vegetation, into rivers, the research found.
From there, housed in mounds of dirt and stones, the carbon is often dragged to the ocean, where is sinks to the floor, removed from the atmosphere.
Scientists from Britain, Japan and Taiwan studied deposits in Taiwan's LiWu river in the aftermath of floods caused by hurricanes and typhoons for the study, published in the journal Nature Geoscience.
They estimate that between 80 to 90 per cent of recent carbon deposits were carried there by floodwater.
The storms could provide the "optimum conditions" to bury carbon, the study found.
Robert Hilton, from Cambridge University, who was one of the scientists who led the study, said that the same effects would be seen on other islands including Japan, the Philippines, Cuba and Jamaica, where rivers could easily carry the carbon to the ocean.
"However, the rate at which this happens is around 100 to 1,000 times slower than the amount of carbon dioxide that is being pumped into the atmosphere by man's activity," he warned.
"Although we found that these tropical cyclones act as nature's way of trying to re-balance the amount of carbon in the atmosphere, they can only do so much."
He believes that the number and intensity of the storms will increase in relation to the amount of carbon dioxide released into the atmosphere.
"Other studies have already suggested that already the size of cyclones and their power is increasing in response to global warming."
However, he emphasised that cyclones were not the only natural process by which the earth brought its carbon dioxide levels into balance, and that the gas was also captured by processes including being buried in large limescale deposits, such as the White Cliffs of Dover.
"Carbon capture" has been hailed as a breakthrough in the quest for cleaner energy production.
Earlier this month the Environment Agency advised that no new coal-fired power stations should be built unless they could capture and store CO2, usually miles underground.
By Kate Devlin Last Updated: 7:15PM BST 19 Oct 2008
Scientists found that the storms act as a natural form of "carbon capture" by helping to trap carbon dioxide deep at the bottom of the ocean.
The more carbon dioxide is released into the atmosphere, the greater the number of strength of such storms, the study also suggests, although they will never rise to levels enough to reduce the current rate of global warming, the researchers warn.
However, the breakthrough will help scientists to improve their understanding of how the earth reacts to greenhouse gases and to tailor forecasts of the cycle more accurately.
The new study found that tropical cyclones, the umbrella term for hurricanes and typhoons, act as a counterbalance to increasing levels of carbon in the atmosphere.
These can be caused naturally, by events such as the eruption of volcanoes, as well as by man-made pollution.
The cyclones create large-scale floods which carry vast amounts of carbon, trapped in soil and vegetation, into rivers, the research found.
From there, housed in mounds of dirt and stones, the carbon is often dragged to the ocean, where is sinks to the floor, removed from the atmosphere.
Scientists from Britain, Japan and Taiwan studied deposits in Taiwan's LiWu river in the aftermath of floods caused by hurricanes and typhoons for the study, published in the journal Nature Geoscience.
They estimate that between 80 to 90 per cent of recent carbon deposits were carried there by floodwater.
The storms could provide the "optimum conditions" to bury carbon, the study found.
Robert Hilton, from Cambridge University, who was one of the scientists who led the study, said that the same effects would be seen on other islands including Japan, the Philippines, Cuba and Jamaica, where rivers could easily carry the carbon to the ocean.
"However, the rate at which this happens is around 100 to 1,000 times slower than the amount of carbon dioxide that is being pumped into the atmosphere by man's activity," he warned.
"Although we found that these tropical cyclones act as nature's way of trying to re-balance the amount of carbon in the atmosphere, they can only do so much."
He believes that the number and intensity of the storms will increase in relation to the amount of carbon dioxide released into the atmosphere.
"Other studies have already suggested that already the size of cyclones and their power is increasing in response to global warming."
However, he emphasised that cyclones were not the only natural process by which the earth brought its carbon dioxide levels into balance, and that the gas was also captured by processes including being buried in large limescale deposits, such as the White Cliffs of Dover.
"Carbon capture" has been hailed as a breakthrough in the quest for cleaner energy production.
Earlier this month the Environment Agency advised that no new coal-fired power stations should be built unless they could capture and store CO2, usually miles underground.
Lethal build-up of ozone poses threat to UK
Scientists call for global measures amid warnings that the gas damages health and the environment
Robin McKie, science editor
The Observer,
Sunday October 19 2008
Britain is ignoring the dangers posed by one of the world's worst air pollutants: ozone. Researchers say that levels of the gas - a powerful contributor to global warming and the cause of hundreds of deaths a year from respiratory illnesses - are rising at an alarming rate.
They have also warned that measures to curtail the gas are failing. As a result, ozone-related deaths, of which there are about 1,500 a year in the UK, could rise by 50 per cent over the next decade. Stronger international treaties need to be set up to counter the threat, they insist.
'A lot more interest needs to be taken in ozone - not only as a cause of global warming but as an immediate threat to human health and to the environment,' said Professor Piers Foster of Leeds University, an author of the most recent report from the Intergovernmental Panel on Climate Change. 'It could have a significant impact on the planet.'
Ozone is produced by the impact of sunlight on atmospheric pollutants, including car exhausts, and is strongly associated with smogs caused by traffic fumes. Hot summers, in areas polluted with nitrogen oxides and volatile organic chemicals (VOCs) emitted by vehicles, produce peak levels of ozone. Unlike ozone in the stratosphere, which protects Earth from harmful ultraviolet radiation, ozone in the lower atmosphere is harmful to humans, animals and plants.
The EU has introduced measures to reduces these pollutants, mainly by ensuring three-way converters are fitted to cars, and this has helped reduce ozone production in Europe. But countries such as Russia, China and India are still major emitters, and ozone from these nations is constantly being blown over Britain. As a result, levels are continuing to rise at a rate of 6 per cent per decade.
'The trouble is that ozone production is controlled by a patchwork of local laws and regulations,' said Professor David Fowler of the Centre for Ecology and Hydrology, Edinburgh, leader of a recent Royal Society working group on ozone. 'Weather systems and jet streams transport ozone and the pollutants that trigger its production far from its point of origin. In addition, shipping is a major producer.
'So you could introduce all sorts of measures to cut down local emissions, but these reductions would be overwhelmed by the ozone and the nitrogen oxide pollutants being swept over the country from marine and from foreign sources. Until we get an integrated network of international agreements in place, we will never get round the problem. At present no efforts are being made to set these up, however.'
Rising production of ozone is alarming because the gas is the third biggest contributor to global warming. Only carbon dioxide and methane have bigger impacts. But unlike them ozone also affects health. It is a powerful oxidant and damages lung tissue. In 2003 it caused more than 1,500 deaths in the UK - mainly among children and the elderly - and that figure is set to rise to about 2,400 a year by 2020.
In addition, the gas has a serious impact on the ecology. Ozone enters plants through respiratory pores in their leaves and harms their ability to photosynthesise foodstuffs. Plants are left weak and undersized. It is estimated that in 2000, ozone caused £5bn damage to crops in Europe, a figure that is rising by the year.
Even worse, trees and vegetation damaged by ozone cannot properly absorb carbon dioxide and the gas therefore has a double impact on the climate: it helps raise the temperature of the atmosphere and it hinders the planet's ability to cope with other greenhouse gases. Thus limiting ozone production should be given greater priority, a point stressed by Professor Peter Cox of Exeter University.
'We estimate that these effects on plants could double the importance of ozone increases in the lower atmosphere as a driver of climate change,' he said. 'So policies to limit increase in ozone must be seen as an even higher priority.'
The danger hole
Ozone is harmful at sea level but in the stratosphere, six to 31 miles high, it forms a protective layer which blots out the sun's powerful ultra-violet radiation. In 1985, scientists discovered a growing hole in this layer over Antarctica which had been caused by made-made chemicals in the atmosphere. Bans on these products should close the ozone hole, but not until 2060.
Robin McKie, science editor
The Observer,
Sunday October 19 2008
Britain is ignoring the dangers posed by one of the world's worst air pollutants: ozone. Researchers say that levels of the gas - a powerful contributor to global warming and the cause of hundreds of deaths a year from respiratory illnesses - are rising at an alarming rate.
They have also warned that measures to curtail the gas are failing. As a result, ozone-related deaths, of which there are about 1,500 a year in the UK, could rise by 50 per cent over the next decade. Stronger international treaties need to be set up to counter the threat, they insist.
'A lot more interest needs to be taken in ozone - not only as a cause of global warming but as an immediate threat to human health and to the environment,' said Professor Piers Foster of Leeds University, an author of the most recent report from the Intergovernmental Panel on Climate Change. 'It could have a significant impact on the planet.'
Ozone is produced by the impact of sunlight on atmospheric pollutants, including car exhausts, and is strongly associated with smogs caused by traffic fumes. Hot summers, in areas polluted with nitrogen oxides and volatile organic chemicals (VOCs) emitted by vehicles, produce peak levels of ozone. Unlike ozone in the stratosphere, which protects Earth from harmful ultraviolet radiation, ozone in the lower atmosphere is harmful to humans, animals and plants.
The EU has introduced measures to reduces these pollutants, mainly by ensuring three-way converters are fitted to cars, and this has helped reduce ozone production in Europe. But countries such as Russia, China and India are still major emitters, and ozone from these nations is constantly being blown over Britain. As a result, levels are continuing to rise at a rate of 6 per cent per decade.
'The trouble is that ozone production is controlled by a patchwork of local laws and regulations,' said Professor David Fowler of the Centre for Ecology and Hydrology, Edinburgh, leader of a recent Royal Society working group on ozone. 'Weather systems and jet streams transport ozone and the pollutants that trigger its production far from its point of origin. In addition, shipping is a major producer.
'So you could introduce all sorts of measures to cut down local emissions, but these reductions would be overwhelmed by the ozone and the nitrogen oxide pollutants being swept over the country from marine and from foreign sources. Until we get an integrated network of international agreements in place, we will never get round the problem. At present no efforts are being made to set these up, however.'
Rising production of ozone is alarming because the gas is the third biggest contributor to global warming. Only carbon dioxide and methane have bigger impacts. But unlike them ozone also affects health. It is a powerful oxidant and damages lung tissue. In 2003 it caused more than 1,500 deaths in the UK - mainly among children and the elderly - and that figure is set to rise to about 2,400 a year by 2020.
In addition, the gas has a serious impact on the ecology. Ozone enters plants through respiratory pores in their leaves and harms their ability to photosynthesise foodstuffs. Plants are left weak and undersized. It is estimated that in 2000, ozone caused £5bn damage to crops in Europe, a figure that is rising by the year.
Even worse, trees and vegetation damaged by ozone cannot properly absorb carbon dioxide and the gas therefore has a double impact on the climate: it helps raise the temperature of the atmosphere and it hinders the planet's ability to cope with other greenhouse gases. Thus limiting ozone production should be given greater priority, a point stressed by Professor Peter Cox of Exeter University.
'We estimate that these effects on plants could double the importance of ozone increases in the lower atmosphere as a driver of climate change,' he said. 'So policies to limit increase in ozone must be seen as an even higher priority.'
The danger hole
Ozone is harmful at sea level but in the stratosphere, six to 31 miles high, it forms a protective layer which blots out the sun's powerful ultra-violet radiation. In 1985, scientists discovered a growing hole in this layer over Antarctica which had been caused by made-made chemicals in the atmosphere. Bans on these products should close the ozone hole, but not until 2060.
On our present course, the bold new carbon target is worthless
Editorial
The Observer,
Sunday October 19 2008
The decision by Ed Miliband, the energy and climate change secretary, to commit Britain to cutting its greenhouse gas emissions by 80 per cent by 2050 is welcome. Recent research has made it clear that the government's previous target of a 60 per cent reduction would be insufficient to help halt profound climate change this century. New measures were required.
But we should note that setting goals is the easy part of fighting global warming; implementing them is harder. This point is demonstrated in the report in The Observer today on Britain's wind energy programme. This is supposed to ensure that a third of all UK electricity is generated by onshore and offshore turbines by 2020. But it is now facing collapse, a victim of rising costs, planning blockages and poor investment. Government action is falling well short of its rhetoric.
The failure to insist that carbon capture devices be fitted to the proposed new coal-fired power plant at Kingsnorth provides another example. Without such machinery, vast amounts of carbon dioxide will be pumped into the atmosphere, making nonsense of the UK's commitment to combat global warming. Transport policy is similarly unenlightened. The government backs motorway construction schemes and continues to call for cuts in petrol prices, ignoring the environmental implications. It also refuses to include aviation fuel in its climate change calculations - as if ignoring its consumption means it will no longer be heating the planet. Likewise, a commitment to the expansion of UK airports seriously undermines our claim to be climate change champions.
The government must establish a consistent attitude to global warming and back this with significant investments. It should provide a national electricity grid that can carry power from remote wind turbines to cities; develop a wave and tidal power energy programme that will take advantage of our marine expertise; and create carbon capture schemes that will allow us to build a new generation of coal power plants.
It is also clear that the world's current economic crisis provides no excuse for failing to make proper investments and hard political decisions. The 2006 report by Sir Nicholas Stern showed the costs of acting will be vastly outweighed by the costs of not acting. The government must therefore be resolute - and consistent.
The Observer,
Sunday October 19 2008
The decision by Ed Miliband, the energy and climate change secretary, to commit Britain to cutting its greenhouse gas emissions by 80 per cent by 2050 is welcome. Recent research has made it clear that the government's previous target of a 60 per cent reduction would be insufficient to help halt profound climate change this century. New measures were required.
But we should note that setting goals is the easy part of fighting global warming; implementing them is harder. This point is demonstrated in the report in The Observer today on Britain's wind energy programme. This is supposed to ensure that a third of all UK electricity is generated by onshore and offshore turbines by 2020. But it is now facing collapse, a victim of rising costs, planning blockages and poor investment. Government action is falling well short of its rhetoric.
The failure to insist that carbon capture devices be fitted to the proposed new coal-fired power plant at Kingsnorth provides another example. Without such machinery, vast amounts of carbon dioxide will be pumped into the atmosphere, making nonsense of the UK's commitment to combat global warming. Transport policy is similarly unenlightened. The government backs motorway construction schemes and continues to call for cuts in petrol prices, ignoring the environmental implications. It also refuses to include aviation fuel in its climate change calculations - as if ignoring its consumption means it will no longer be heating the planet. Likewise, a commitment to the expansion of UK airports seriously undermines our claim to be climate change champions.
The government must establish a consistent attitude to global warming and back this with significant investments. It should provide a national electricity grid that can carry power from remote wind turbines to cities; develop a wave and tidal power energy programme that will take advantage of our marine expertise; and create carbon capture schemes that will allow us to build a new generation of coal power plants.
It is also clear that the world's current economic crisis provides no excuse for failing to make proper investments and hard political decisions. The 2006 report by Sir Nicholas Stern showed the costs of acting will be vastly outweighed by the costs of not acting. The government must therefore be resolute - and consistent.
The greening of Brown
Editorial
The Guardian,
Monday October 20 2008
Until recently, even friends of Gordon Brown scarcely bothered to pretend he had much interest in the environment. Poverty and education, they said, got him out of bed; climate change was something he approached intellectually, not instinctively. Less friendly colleagues would put it more bluntly: the subject bored him rigid. There are welcome signs that the prime minister's preoccupations are shifting. Having developed a taste for financial statesmanship of late, Mr Brown is now said to fancy himself as the man to broker the post-Kyoto framework at the Copenhagen summit next year. A year ago the suggestion would have been laughable; contemporary developments - including Britain's support for investment in carbon capture at today's EU environment council - make it somewhat less so now. But the true test of the new greenery will come closer to home.
The personnel problems created by reshuffles are often the explanation for rearrangements of Whitehall's furniture. Not so, however, with the creation this month of a Department of Energy and Climate Change. Mr Brown's move split energy off from the business department, a bureaucracy which had a tendency to treat its renewables investment budget as a ready-to-raid piggy bank. The first climate change secretary, Ed Miliband, has got off to a good start. On Thursday he committed the UK to an 80% reduction in greenhouse gases by 2050, finally bringing policy into line with scientific realities. Last week, for once, Britain was on the right side of the European argument, trying to protect climate commitments from the likes of Poland, which are seeking to use the gathering slump as an excuse to cast them aside. Another welcome announcement buried in the rubble of the financial system during the last few days was agreement to a so-called feed-in tariff. This allows households with wind turbines or solar panels to sell power into the system for a fixed price, something German experience suggests will greatly encourage microgeneration.
World-weary greens remember how the early-90s recession put paid to a passing vogue back then for environmental awareness. As jobs are shed there is an obvious danger that immediate financial security will once again become the only issue that counts. The prime minister, however, is said to discern green flashes of light in the dark economic cloud - not least because it is forcing countries to work together. At the weekend the isolationist lame duck in the White House scrambled to recover his relevance by calling an international financial summit. Even before that, coordinated action by central banks had lent multilateralism new credibility. If the international community can pull together to save planet finance then surely it can pull together for the sake of the planet as a whole too. And news this week that Abu Dhabi is to buy a 20% stake in the giant windfarm known as the London Array raises the heartening prospect that oil producers might be persuaded to plough back some profits into alternative energy, a prospect that seemed a remote hope when raised by Mr Brown last summer.
The planet's slow-cooking is an international issue which only international action can solve. But if Mr Brown harbours ambitions to lead it, he must now show the rest of the world he can do better at home. Airport expansion is one unresolved question where Labour has ceded green turf to the Conservatives. The likely licensing of a new coal-fired power station at Kingsnorth is another urgent issue. Vague suggestions that it will be made "ready" for carbon capture must be meaningfully fleshed out, and soon, or it will set an appalling precedent. Doing the right thing on transport and energy will mean taking political risks. Mr Brown must now prove that he is prepared to treat an ailing climate with an injection of political capital to match the vast dose of financial capital he was so willing to invest in the banks.
The Guardian,
Monday October 20 2008
Until recently, even friends of Gordon Brown scarcely bothered to pretend he had much interest in the environment. Poverty and education, they said, got him out of bed; climate change was something he approached intellectually, not instinctively. Less friendly colleagues would put it more bluntly: the subject bored him rigid. There are welcome signs that the prime minister's preoccupations are shifting. Having developed a taste for financial statesmanship of late, Mr Brown is now said to fancy himself as the man to broker the post-Kyoto framework at the Copenhagen summit next year. A year ago the suggestion would have been laughable; contemporary developments - including Britain's support for investment in carbon capture at today's EU environment council - make it somewhat less so now. But the true test of the new greenery will come closer to home.
The personnel problems created by reshuffles are often the explanation for rearrangements of Whitehall's furniture. Not so, however, with the creation this month of a Department of Energy and Climate Change. Mr Brown's move split energy off from the business department, a bureaucracy which had a tendency to treat its renewables investment budget as a ready-to-raid piggy bank. The first climate change secretary, Ed Miliband, has got off to a good start. On Thursday he committed the UK to an 80% reduction in greenhouse gases by 2050, finally bringing policy into line with scientific realities. Last week, for once, Britain was on the right side of the European argument, trying to protect climate commitments from the likes of Poland, which are seeking to use the gathering slump as an excuse to cast them aside. Another welcome announcement buried in the rubble of the financial system during the last few days was agreement to a so-called feed-in tariff. This allows households with wind turbines or solar panels to sell power into the system for a fixed price, something German experience suggests will greatly encourage microgeneration.
World-weary greens remember how the early-90s recession put paid to a passing vogue back then for environmental awareness. As jobs are shed there is an obvious danger that immediate financial security will once again become the only issue that counts. The prime minister, however, is said to discern green flashes of light in the dark economic cloud - not least because it is forcing countries to work together. At the weekend the isolationist lame duck in the White House scrambled to recover his relevance by calling an international financial summit. Even before that, coordinated action by central banks had lent multilateralism new credibility. If the international community can pull together to save planet finance then surely it can pull together for the sake of the planet as a whole too. And news this week that Abu Dhabi is to buy a 20% stake in the giant windfarm known as the London Array raises the heartening prospect that oil producers might be persuaded to plough back some profits into alternative energy, a prospect that seemed a remote hope when raised by Mr Brown last summer.
The planet's slow-cooking is an international issue which only international action can solve. But if Mr Brown harbours ambitions to lead it, he must now show the rest of the world he can do better at home. Airport expansion is one unresolved question where Labour has ceded green turf to the Conservatives. The likely licensing of a new coal-fired power station at Kingsnorth is another urgent issue. Vague suggestions that it will be made "ready" for carbon capture must be meaningfully fleshed out, and soon, or it will set an appalling precedent. Doing the right thing on transport and energy will mean taking political risks. Mr Brown must now prove that he is prepared to treat an ailing climate with an injection of political capital to match the vast dose of financial capital he was so willing to invest in the banks.
Former BP chief Lord Browne speaks against alarmism on biofuels
The Times
October 20, 2008
Robin Pagnamenta, Energy and Environment Editor
Biofuels can play a key role in global efforts to tackle climate change, but “media alarmism and misinformation” are damaging their potential, according to Lord Browne of Madingley.
The chairman of the Accenture Global Energy Board and former chief executive of BP told The Times that there was a risk of premature policy changes because of fears that biofuels would indirectly boost greenhouse gas emissions through knock-on effects on land use — a concern that he said was important but was based on science that was new and, therefore, poorly understood.
“The right way to distinguish between good and bad biofuels is by using clear, stable and predictable carbon dioxide and sustainability standards,” Lord Browne said in an e-mailed series of answers to questions set by The Times.
He said that Europe should stick to its stated target of including a 10 per cent mix of biofuels in all vehicle fuel by 2020. Failure to do so would “risk destabilising the investing environment in European renewables for a generation”.
He also called for biofuels to be treated as an emerging global commodity. At present the biofuels market is distorted by a US subsidy on the domestic production of corn ethanol that effectively blocks imports, such as Brazilian sugar-cane ethanol.
Lord Browne, who is also president of the Royal Academy of Engineering, said that he strongly supported the call by Lord Turner of Ecchinswell for Britain to slash its carbon emissions by 80 per cent by 2050. To get there will require an all-encompassing approach, “taking energy out of our lifestyles, through a revolution in energy efficiency, and taking carbon out of energy, through fundamentally changing the energy mix we use in favour of low-carbon technologies. To achieve both will require a basket of fiscal and regulatory policies and public education.”
Lord Browne also said that Britain was leading the world in its understanding of the science and economics of climate change. He said that the work of Sir David King, Lord Stern and others had led to the formation of a clear blueprint for the steps that the world needs to take to tackle climate change.
“The challenge from here is translating policy prescriptions into action,” he said. “The watchword is delivery, and that will require political leadership that transcends electoral politics and short-term economic cycles. It will also require a great deal of hard, technical and politically unglamorous work.”
He said that the global battle to keep carbon dioxide levels from rising to dangerous levels would require the formation of a new institution, which he called “an international carbon fund”, to oversee the formation of a new market in carbon credits. This would “provide liquidity in emerging international carbon markets and supervise national and regional efforts, which have proliferated in the past decade”.
He said that such a system must be adapted urgently to include deforestation, which is responsible for a fifth of global emissions.
“The key first step is removing the ban on forestry credits in the EU Emissions Trading Scheme,” he said.
Lord Browne expressed confidence that the turmoil in the financial markets would not distract policymakers from reaching a new international climate change deal to follow Kyoto at a United Nations meeting in Copenhagen next year. “There are encouraging signs that climate change remains a political priority,” he said, pointing to the Government's decision to create a new Ministry for Energy and Climate Policy and to make a renewed push on energy efficiency. He also welcomed the European Parliament's proposal to offer financial support for up to 12 carbon capture and storage demonstration projects, which he called “a critical next step for this essential technology”.
Lord Browne said that he believed that the recent fall in the price of oil was being driven by a “malaise from the credit crunch leading to weakening demand expectations. This — coupled with the several hundred thousand barrels of non-Opec production expected to come on-stream in the coming months — is leading to rising spare production capacity and therefore downward pressure on prices.” However, he said that he saw no reason why oil production would not rise, from 86 million barrels per day to perhaps as many as 116million by 2030, a level that some have disputed.
“The biggest barriers are likely to be above ground, mostly stemming from politics associated with the growing concentration of oil and gas supplies,” he said.
October 20, 2008
Robin Pagnamenta, Energy and Environment Editor
Biofuels can play a key role in global efforts to tackle climate change, but “media alarmism and misinformation” are damaging their potential, according to Lord Browne of Madingley.
The chairman of the Accenture Global Energy Board and former chief executive of BP told The Times that there was a risk of premature policy changes because of fears that biofuels would indirectly boost greenhouse gas emissions through knock-on effects on land use — a concern that he said was important but was based on science that was new and, therefore, poorly understood.
“The right way to distinguish between good and bad biofuels is by using clear, stable and predictable carbon dioxide and sustainability standards,” Lord Browne said in an e-mailed series of answers to questions set by The Times.
He said that Europe should stick to its stated target of including a 10 per cent mix of biofuels in all vehicle fuel by 2020. Failure to do so would “risk destabilising the investing environment in European renewables for a generation”.
He also called for biofuels to be treated as an emerging global commodity. At present the biofuels market is distorted by a US subsidy on the domestic production of corn ethanol that effectively blocks imports, such as Brazilian sugar-cane ethanol.
Lord Browne, who is also president of the Royal Academy of Engineering, said that he strongly supported the call by Lord Turner of Ecchinswell for Britain to slash its carbon emissions by 80 per cent by 2050. To get there will require an all-encompassing approach, “taking energy out of our lifestyles, through a revolution in energy efficiency, and taking carbon out of energy, through fundamentally changing the energy mix we use in favour of low-carbon technologies. To achieve both will require a basket of fiscal and regulatory policies and public education.”
Lord Browne also said that Britain was leading the world in its understanding of the science and economics of climate change. He said that the work of Sir David King, Lord Stern and others had led to the formation of a clear blueprint for the steps that the world needs to take to tackle climate change.
“The challenge from here is translating policy prescriptions into action,” he said. “The watchword is delivery, and that will require political leadership that transcends electoral politics and short-term economic cycles. It will also require a great deal of hard, technical and politically unglamorous work.”
He said that the global battle to keep carbon dioxide levels from rising to dangerous levels would require the formation of a new institution, which he called “an international carbon fund”, to oversee the formation of a new market in carbon credits. This would “provide liquidity in emerging international carbon markets and supervise national and regional efforts, which have proliferated in the past decade”.
He said that such a system must be adapted urgently to include deforestation, which is responsible for a fifth of global emissions.
“The key first step is removing the ban on forestry credits in the EU Emissions Trading Scheme,” he said.
Lord Browne expressed confidence that the turmoil in the financial markets would not distract policymakers from reaching a new international climate change deal to follow Kyoto at a United Nations meeting in Copenhagen next year. “There are encouraging signs that climate change remains a political priority,” he said, pointing to the Government's decision to create a new Ministry for Energy and Climate Policy and to make a renewed push on energy efficiency. He also welcomed the European Parliament's proposal to offer financial support for up to 12 carbon capture and storage demonstration projects, which he called “a critical next step for this essential technology”.
Lord Browne said that he believed that the recent fall in the price of oil was being driven by a “malaise from the credit crunch leading to weakening demand expectations. This — coupled with the several hundred thousand barrels of non-Opec production expected to come on-stream in the coming months — is leading to rising spare production capacity and therefore downward pressure on prices.” However, he said that he saw no reason why oil production would not rise, from 86 million barrels per day to perhaps as many as 116million by 2030, a level that some have disputed.
“The biggest barriers are likely to be above ground, mostly stemming from politics associated with the growing concentration of oil and gas supplies,” he said.
CEQ on FT.com: Paying up for gas
By Dawn Lee
Published: October 20 2008 03:35
A key element in China’s twin efforts to diversify its energy sources and reduce greenhouse gas emissions is to increase use of natural gas. Until recently, China’s natural gas program was hampered by the high cost of infrastructure – gas pipelines and terminals for liquefied natural gas (LNG) – and by the unwillingness of national oil companies to pay market prices for imported gas. But the past year has seen a dramatic turnaround. Pipelines and terminals are now in place. And with the international price of gas at less than half than that of its main petroleum-based alternative, fuel oil, Chinese firms are now happily paying market prices. The result should be a rapid upsurge in Chinese gas imports.
The planned increases in natural gas to heat homes, fire power plants, and provide chemical feedstocks are part of a broader move to reduce China’s reliance on dirty coal and expensive oil, and to increase consumption of clean-burning natural gas and renewables, in order to diversify supplies and reduce greenhouse gas emissions. The present target is to increase the natural gas share of China’s primary energy consumption from 2.3 per cent in 2005 to 5.3 per cent in 2010.
Some of this increase would come from domestic gas production, which is targeted to jump by a third over the next three years, from 69bn m3 in 2007 to 92bn m3 in 2010. The major domestic production areas are Xinjiang in the northwest and Sichuan in the southwest; these two regions account for 38 per cent and 25 per cent of the nation’s total natural gas output, respectively. But an even bigger chunk of the increase will have to come from imports, which were less than 4bn m3 in 2007 but are targeted to rise to 48bn m3 by 2010, by which time they will account for 34 per cent of China’s total annual consumption of 140bn m3. So far, China has no pipeline gas imports; LNG imports began flowing into newly-built terminals in southern China in 2006.
NDRC’s gas pricing policy is quite complex and represents a compromise between two conflicting aims: to ensure a degree of price stability while at the same time pushing Chinese prices closer to international norms. NDRC divides the country’s total gas output into two categories (depending on which fields the gas comes from). Category 1 is priced at an NDRC-set benchmark rate; Category 2 is priced at a benchmark linked to a basket representing international crude oil, liquefied petroleum gas and coal prices. The basket benchmark is re-set annually by NDRC, by no more than 8 per cent.
When the pricing policy was established in 2006, about 85 per cent of gas was sold at cheaper Category 1 rates. Since then, however, more and more gas has been priced at the higher Category 2 rates; and NDRC plans to abolish the subsidized Category 1 pricing by 2011.
With the regulated domestic price now rising by 8 per cent a year in renminbi terms (and at 14-15 per cent in US dollar terms once currency appreciation is factored in) Chinese energy companies are now far more willing to pay international market prices for imported gas. They have also figured out that natural gas is far cheaper than its principal substitute, fuel oil. In May 2008 a gallon of fuel oil cost US$3.70, while an equivalent amount of natural gas cost US$1.67. As a result of these price dynamics, the pace of China’s cross-border gas deals has accelerated dramatically.
China’s first major international gas purchase contract came in 2002, when China National Offshore Oil Corp. (CNOOC) paid US$3 per million British thermal units (BTU) for long-term LNG supplies from Australia for its planned Dapeng terminal in Shenzhen. During the next several years Chinese firms signed no new LNG deals, in part because with sharply-rising international crude oil prices, there was no LNG to be had at prices as low as the Dapeng deal. Negotiations over a 25-year supply agreement between BP’s Tangguh field in Indonesia and CNOOC’s planned Fujian terminal, begun in 2002, stalled because of rising prices and came to fruition only in 2006 when CNOOC accepted a ceiling price of US$3.50 per million BTU, a quarter higher than the originally agreed price of US$2.70.
Since then Chinese tolerance for higher LNG prices has risen sharply. In 2006 CNOOC agreed to a price of US$5.6-5.8 per million BTU for Malaysian gas and in September 2007 PetroChina signed two provisional deals to import up to 4m tons a year from the Browse and Gorgon projects in Australia at around US$10 per million BTU.
Finally, the government of electricity-starved Guangdong province authorized CNOOC’s Dapeng terminal to import spot shipments of LNG, without prior government approval, up to a limit of US$15 per million BTU. Dapeng, which began operations in 2006, began importing spot cargoes to cater to demand from local power plants. In 2007, spot cargoes were 435,000 tons, or about 15 per cent of all LNG shipped to Dapeng.
Somewhat better prices may be obtainable through cross-border pipeline deals. PetroChina parent CNPC in 2007 signed a 30-year production sharing and gas import agreement with Turkmenistan, under which CNPC will pay US$5.40 per million BTU at the well-head at the Amu Darya field. Transport to the border in northwest China will add about a third to the price, bringing the total landed cost to around US$7.20. Ultimately, this gas will reach Shanghai and Guangdong via a second West-East pipeline now under construction by CNPC, scheduled for completion in 2011.
Copyright The Financial Times Limited 2008
Published: October 20 2008 03:35
A key element in China’s twin efforts to diversify its energy sources and reduce greenhouse gas emissions is to increase use of natural gas. Until recently, China’s natural gas program was hampered by the high cost of infrastructure – gas pipelines and terminals for liquefied natural gas (LNG) – and by the unwillingness of national oil companies to pay market prices for imported gas. But the past year has seen a dramatic turnaround. Pipelines and terminals are now in place. And with the international price of gas at less than half than that of its main petroleum-based alternative, fuel oil, Chinese firms are now happily paying market prices. The result should be a rapid upsurge in Chinese gas imports.
The planned increases in natural gas to heat homes, fire power plants, and provide chemical feedstocks are part of a broader move to reduce China’s reliance on dirty coal and expensive oil, and to increase consumption of clean-burning natural gas and renewables, in order to diversify supplies and reduce greenhouse gas emissions. The present target is to increase the natural gas share of China’s primary energy consumption from 2.3 per cent in 2005 to 5.3 per cent in 2010.
Some of this increase would come from domestic gas production, which is targeted to jump by a third over the next three years, from 69bn m3 in 2007 to 92bn m3 in 2010. The major domestic production areas are Xinjiang in the northwest and Sichuan in the southwest; these two regions account for 38 per cent and 25 per cent of the nation’s total natural gas output, respectively. But an even bigger chunk of the increase will have to come from imports, which were less than 4bn m3 in 2007 but are targeted to rise to 48bn m3 by 2010, by which time they will account for 34 per cent of China’s total annual consumption of 140bn m3. So far, China has no pipeline gas imports; LNG imports began flowing into newly-built terminals in southern China in 2006.
NDRC’s gas pricing policy is quite complex and represents a compromise between two conflicting aims: to ensure a degree of price stability while at the same time pushing Chinese prices closer to international norms. NDRC divides the country’s total gas output into two categories (depending on which fields the gas comes from). Category 1 is priced at an NDRC-set benchmark rate; Category 2 is priced at a benchmark linked to a basket representing international crude oil, liquefied petroleum gas and coal prices. The basket benchmark is re-set annually by NDRC, by no more than 8 per cent.
When the pricing policy was established in 2006, about 85 per cent of gas was sold at cheaper Category 1 rates. Since then, however, more and more gas has been priced at the higher Category 2 rates; and NDRC plans to abolish the subsidized Category 1 pricing by 2011.
With the regulated domestic price now rising by 8 per cent a year in renminbi terms (and at 14-15 per cent in US dollar terms once currency appreciation is factored in) Chinese energy companies are now far more willing to pay international market prices for imported gas. They have also figured out that natural gas is far cheaper than its principal substitute, fuel oil. In May 2008 a gallon of fuel oil cost US$3.70, while an equivalent amount of natural gas cost US$1.67. As a result of these price dynamics, the pace of China’s cross-border gas deals has accelerated dramatically.
China’s first major international gas purchase contract came in 2002, when China National Offshore Oil Corp. (CNOOC) paid US$3 per million British thermal units (BTU) for long-term LNG supplies from Australia for its planned Dapeng terminal in Shenzhen. During the next several years Chinese firms signed no new LNG deals, in part because with sharply-rising international crude oil prices, there was no LNG to be had at prices as low as the Dapeng deal. Negotiations over a 25-year supply agreement between BP’s Tangguh field in Indonesia and CNOOC’s planned Fujian terminal, begun in 2002, stalled because of rising prices and came to fruition only in 2006 when CNOOC accepted a ceiling price of US$3.50 per million BTU, a quarter higher than the originally agreed price of US$2.70.
Since then Chinese tolerance for higher LNG prices has risen sharply. In 2006 CNOOC agreed to a price of US$5.6-5.8 per million BTU for Malaysian gas and in September 2007 PetroChina signed two provisional deals to import up to 4m tons a year from the Browse and Gorgon projects in Australia at around US$10 per million BTU.
Finally, the government of electricity-starved Guangdong province authorized CNOOC’s Dapeng terminal to import spot shipments of LNG, without prior government approval, up to a limit of US$15 per million BTU. Dapeng, which began operations in 2006, began importing spot cargoes to cater to demand from local power plants. In 2007, spot cargoes were 435,000 tons, or about 15 per cent of all LNG shipped to Dapeng.
Somewhat better prices may be obtainable through cross-border pipeline deals. PetroChina parent CNPC in 2007 signed a 30-year production sharing and gas import agreement with Turkmenistan, under which CNPC will pay US$5.40 per million BTU at the well-head at the Amu Darya field. Transport to the border in northwest China will add about a third to the price, bringing the total landed cost to around US$7.20. Ultimately, this gas will reach Shanghai and Guangdong via a second West-East pipeline now under construction by CNPC, scheduled for completion in 2011.
Copyright The Financial Times Limited 2008
Canberra sees cost benefit in CO2 trades
ByFiona Harvey
Published: October 20 2008 01:34
Australia will press ahead with a national carbon trading scheme in spite of claims from businesses that it could damage their competitiveness.
Penny Wong, minister for climate change and water, told the Financial Times that the global financial crisis was not a reason to put off commitments to reduce emissions: “We were elected last year with a very clear commitment to emissions trading ... Australians have been clear that they want the government to take action.”
Penny Wong: any attempt to delay carbon trading would be counterproductive
She said: “Our view is that the economic case is against [any] delay [in introducing the trading scheme]. If you accept that the world will eventually move to a global carbon constraint, nations that have put in place the means to manage that will be in the best position.”
In Europe, where a carbon trading scheme has been operating since 2005, businesses have been lobbying for a watering down of the scheme. But European Union leaders last week reaffirmed their climate change commitments and decided to press ahead with tough emissions reduction targets.
Australia’s carbon trading scheme, which will cover about 70 per cent of businesses, is scheduled to come into effect in 2010. The government is consulting on the details of how it should work, with draft legislation likely early next year.
In December, the government will announce the country’s mid-term goal for cutting carbon emissions, which will dictate how many carbon permits are made available to companies covered by the trading system. The government has already committed to a 60 per cent cut in emissions by 2050.
Australia’s opposition parties this month called for the trading scheme to be delayed for up to two years. The Business Council of Australia has also warned that the scheme would put many companies at risk.
But Ms Wong said: “We are very conscious in particular of the need for business certainty.” She said any attempt to delay trading would be counterproductive: “Delay increases uncertainty at a time when we are seeking policy clarity to enable the transition [to emissions trading] to be made at the lowest cost.”
Australia’s planned Carbon Pollution Reduction Scheme would require companies to buy most of their emissions permits at auction. The government would soften the economic effect with a climate change action fund, directed towards changing manufacturing processes, and to industrial energy efficiency projects with long payback periods. There will also be a special adjustment scheme for the coal-fired electricity industry.
Australian companies could benefit by focusing on new technologies such as renewables and carbon capture and storage, Ms Wong said. Australia has large solar and wind resources and the government has pledged A$100m ($69m, €51m, £40m) a year for the development of carbon capture and storage technology.
CV: Penny Wong
1968 Born in Sabah, Malaysia, Moved to Australia aged eight. Graduated in law from the University of Adelaide, and began working for the Construction, Forestry, Mining and Energy Union
2001 Elected as a Senator for South Australia
2004-07 Member of the shadow ministry
2007 Appointed minister for climate change and water following election victory of the Labor party, led by Kevin Rudd. One of Mr Rudd’s first actions was to sign the Kyoto treaty
Copyright The Financial Times Limited 2008
Published: October 20 2008 01:34
Australia will press ahead with a national carbon trading scheme in spite of claims from businesses that it could damage their competitiveness.
Penny Wong, minister for climate change and water, told the Financial Times that the global financial crisis was not a reason to put off commitments to reduce emissions: “We were elected last year with a very clear commitment to emissions trading ... Australians have been clear that they want the government to take action.”
Penny Wong: any attempt to delay carbon trading would be counterproductive
She said: “Our view is that the economic case is against [any] delay [in introducing the trading scheme]. If you accept that the world will eventually move to a global carbon constraint, nations that have put in place the means to manage that will be in the best position.”
In Europe, where a carbon trading scheme has been operating since 2005, businesses have been lobbying for a watering down of the scheme. But European Union leaders last week reaffirmed their climate change commitments and decided to press ahead with tough emissions reduction targets.
Australia’s carbon trading scheme, which will cover about 70 per cent of businesses, is scheduled to come into effect in 2010. The government is consulting on the details of how it should work, with draft legislation likely early next year.
In December, the government will announce the country’s mid-term goal for cutting carbon emissions, which will dictate how many carbon permits are made available to companies covered by the trading system. The government has already committed to a 60 per cent cut in emissions by 2050.
Australia’s opposition parties this month called for the trading scheme to be delayed for up to two years. The Business Council of Australia has also warned that the scheme would put many companies at risk.
But Ms Wong said: “We are very conscious in particular of the need for business certainty.” She said any attempt to delay trading would be counterproductive: “Delay increases uncertainty at a time when we are seeking policy clarity to enable the transition [to emissions trading] to be made at the lowest cost.”
Australia’s planned Carbon Pollution Reduction Scheme would require companies to buy most of their emissions permits at auction. The government would soften the economic effect with a climate change action fund, directed towards changing manufacturing processes, and to industrial energy efficiency projects with long payback periods. There will also be a special adjustment scheme for the coal-fired electricity industry.
Australian companies could benefit by focusing on new technologies such as renewables and carbon capture and storage, Ms Wong said. Australia has large solar and wind resources and the government has pledged A$100m ($69m, €51m, £40m) a year for the development of carbon capture and storage technology.
CV: Penny Wong
1968 Born in Sabah, Malaysia, Moved to Australia aged eight. Graduated in law from the University of Adelaide, and began working for the Construction, Forestry, Mining and Energy Union
2001 Elected as a Senator for South Australia
2004-07 Member of the shadow ministry
2007 Appointed minister for climate change and water following election victory of the Labor party, led by Kevin Rudd. One of Mr Rudd’s first actions was to sign the Kyoto treaty
Copyright The Financial Times Limited 2008
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