James Lovelock: You Ask The Questions
The eminent scientist answers your questions, such as 'Is the Earth really aliving organism?' and 'Why do you like nuclear power?'
Monday, 9 March 2009
Carbon cuts 'only give 50/50 chance of saving planet' I have heard that the Gaia theory means that the Earth is alive. What doesthat mean, exactly? Roger Middleton, Chester
The Earth system (Gaia) shares many attributes with a living cell; itmetabolises, it responds to changes in its environment, it can die, and itreduces its internal entropy by taking in high quantum energy as sunlightand excreting infra-red radiation to space. It does not reproduce, butsomething that has lived about 3 billion years hardly needs to reproduce;selection theory asserts that organisms reproduce at a rate reciprocallyrelated to their lifespan. Gaia's reproduction rate would therefore beexpected to be less than one in three billion years.
Some scientists say that your suggestions for geoengineering sea algae willnever work. Is it just pie in the sky? Guy Brewer, Nottingham
Those who claim that encouraging algal growth in the ocean will not reduceCO2 abundance in the air might be right, but they do not know for sure.Their arguments are based on calculations using theoretical models and not,as they should be in science, on observation and experiment. Evidence fromthe ice cores of Antarctica and from ocean sediments suggests that algalgrowth was more abundant in the ice ages. We also know from Antarctic icecore data that the low temperatures of the ice age were closely associatedwith low CO2. It reached as low as 180 parts per million, and this requirespowerful biological pumps. What better than those of the abundant oceanalgae?
Conventional farming methods produce higher yields at less expense. Isorganic farming really good for the environment? Matthew Fell, York
All kinds of farming are less good for the environment than naturalecosystems, such as forests, scrub and deserts. Organic farming might bebetter than agribusiness per hectare, but if it produces less food, moreland would be farmed and consequently there may be nothing to choose betweenorganic and agribusiness farming so far as the environment is concerned.
Is it true that you think that Gaia has always worked in our favour but thatwith climate change Gaia will work against us? Helen Barrington, Winchester
Gaia works in her favour and tries to keep a habitable planet. Mostcertainly she does not work specifically in our favour. When we doenvironmental damage we may disable Gaia's ability to help. Indeed, Gaia maynow be changing the Earth in a way unfavourable for us.
You have said that the UN's scientists are underestimating the speed ofclimate change in their official reports. Is that right? Chris Hastings,Dover
Yes, scientists who observe sea-level rise find it is happening about 1.6times faster than the Intergovernmental Panel on Climate Change predicted.Other observers find the rate of melting of floating ice in the North polarocean is happening faster than predicted. Just now we are long on theory andshort on observations.
If we are past the point of no return, what should we do? Edward Farmer,Pickering
If we are beyond the point of no return, then our greatest efforts should gotowards adapting and making sure that we survive as a species. Beyond thismythical tipping point it would be too late to try to stop global heating.If we have not yet reached the tipping point, I still think that we shouldconcentrate on adapting and surviving. We are not good at working togetherto reduce land use and CO2 emissions, and there may be little time left inwhich to do it.
Why are you so much in favour of nuclear power as a solution? Doesn't ithave lots of dangers? Hatty Hamilton, Exeter
I am in favour of nuclear energy for small, densely populated nations suchas the UK, Germany, France, others in Europe, and Japan. Such nations needan abundant supply of electricity to continue civilised life, and there isno alternative to nuclear energy; we used to use coal, gas and oil but nowknow we cannot. Nuclear energy also happens to be the safest, the mosteconomical and reliable of energy sources. It is foolish to reject it. Itssafety record in the UK – and we are not the best – is a vast improvementover that of coal, gas or oil. Remember over 5,000 people died in one nightin London in the 1950s from coal-smoke poisoning. Apart from water power andsolar energy in desert nations, renewable energy is inefficient, expensiveand unreliable, but with huge subsidies it makes a great deal of money forits developers. Most arguments against nuclear energy are propaganda and itis well worth asking who benefits from the flood of misinformation.
Why do you attack the green movement so much? Aren't you a green yourself?Howard James, Manchester
Yes, I am a green but, not surprisingly, an old-fashioned one. My differencewith the modern greens is mainly over their failure to see that thecountryside has intrinsic value for wildlife, for food supply and as parkland for our ever more urban society. The countryside should not be regardedas an industrial site for wind or solar energy. I also dislike the rampantignorance of science shown by modern greens, especially the idiotic way theyclass all chemicals as bad. We are all made from a mixture of chemicals andnot from some mysterious spiritual brew. Nuclear power is fantastically expensive – no nuclear power plant has eversurvived without vast sums of public money subsidising it.
Aren't yourwell-publicised positions just playing into the hands of the well-financednuclear lobby? David Lowe, Whitehaven
Nuclear power is not more costly than coal power. It could be much lessexpensive than coal, but has been made expensive by the prolonged legal andpolitical objections that confront all attempts to build a new nuclear powerstation. It is nonsense to suggest that there is a wealthy nuclear energylobby. The nuclear fuel industry is tiny compared with the coal, oil and gasindustries, and small compared with the renewable energy industry. The smallsize of the nuclear fuel industry is because one gram of uranium can deliveras much energy as a ton of coal or oil. If uranium were as costly as gold itwould barely affect the price of electricity.
Why are you so hostile to renewable energy in general and wind power inparticular? Norma Jones, Halifax
Mainly because they do not work under north European conditions and becausethey have become, through the abuse of subsidies by the greedy, a scam. Ilike the idea of solar thermal energy in nations with sunlit deserts, andwind energy in places where the wind blows constantly and few people live.
Where do you go to escape? Mary Plant, Plymouth
I would love to know where to go. Just now I am far too busy to escape. Ourholidays are in the South West, mostly walking.
You are determined to leave the planet and "see the face of Gaia" on one ofRichard Branson's strange-looking rockets. Isn't that environmentallydamaging? David Christopher, Birmingham
Probably no more damaging than driving from Devon to London and back a fewtimes or flying to Majorca every summer. If by seeing Gaia from SirRichard's spacecraft I can give a better account of Gaia, it will have beenworthwhile.
You once wrote that, as a result of global warming, "billions of us will die and the few breeding pairs of people that survive will be in the Arctic,where the climate remains tolerable". How should we choose the breedingpairs? Louise Smith, Hamilton
The Earth is already selecting the survivors. Those that move to a saferplace when life gets tough are likely to survive. We are not clever enoughto judge who should survive and should not try. But we may have to chosewhen faced by the awful question, who you allow aboard the lifeboat whenthere is room for only one more?
You're nearly 90. What ambitions do you have left? Henry Allen
To enjoy life to the full while I still can.
Monday, 9 March 2009
Questions over ratings as Coke publishes carbon footprint
Juliette Jowit
The Guardian, Monday 9 March 2009
One is a fruit drink made by a boutique company with a clutch of foodie awards and an impeccable ethical brand, which even boasts a halo on its logo. The other is a fizzy pop, famous for rotting teeth, made by a corporate giant almost synonymous with globalisation.
But when it comes to the environmental issue of the moment - the carbon footprint of their products - the bottle of Innocent smoothie comes off worse than a can of Coke. At least at first glance.
Coca-Cola today becomes the biggest global brand to publish the greenhouse gases produced by making, packaging, transporting, chilling, and disposing of their most popular products. The study, done with the government-funded Carbon Trust, shows a standard 330ml can of Coke embodies the equivalent of 170g of carbon dioxide (CO2e), and the same sized Diet Coke or Coke Zero 150g.
Coke's UK business follows Innocent, which helped the Carbon Trust pioneer its footprinting, and whose 250ml bottle of mango and passion fruit smoothie has a carbon footprint of 209g.
Innocent's co-founder, Richard Reed, questions whether it is fair to compare a bottle of crushed fruit and something largely made of water. Reed's defence highlights a wider issue: how to balance the importance of global warming with other attributes of a product - nutrition, helping poor farmers, careful nurturing of soil, or the welfare of animals. Innocent, for example, donates 10% of profits to charity. "The classical economic response is you implicitly reduce them to a common currency, which leads to money; but my view is these things are just not comparable," said Mike Mason, founder of carbon offset company ClimateCare.
Then there is the issue of what you measure: Coke's cans compare well, but a small glass bottle of the same drink has a footprint of 360g, much higher than Innocent's worst-scoring small bottle of crushed strawberries and bananas (230g).
To resolve these dilemmas, ideas are emerging. Innocent talks of "carbon calories": it calculates that in a world with massively reduced greenhouse gas emissions the average person could afford to eat and drink 2,900g of CO2e each day - and a smoothie would use just 1% of that total.
Mason advocates future labels saying how much carbon is embodied in every pound spent, allowing consumers to compare the impact of anything from a snack to a car.
"Putting an absolute emission on crisps and Aston Martins doesn't tell you very much; using CO2 per pound ... you could grade everything from cars to Coke on the same scale," said Mason.
The Guardian, Monday 9 March 2009
One is a fruit drink made by a boutique company with a clutch of foodie awards and an impeccable ethical brand, which even boasts a halo on its logo. The other is a fizzy pop, famous for rotting teeth, made by a corporate giant almost synonymous with globalisation.
But when it comes to the environmental issue of the moment - the carbon footprint of their products - the bottle of Innocent smoothie comes off worse than a can of Coke. At least at first glance.
Coca-Cola today becomes the biggest global brand to publish the greenhouse gases produced by making, packaging, transporting, chilling, and disposing of their most popular products. The study, done with the government-funded Carbon Trust, shows a standard 330ml can of Coke embodies the equivalent of 170g of carbon dioxide (CO2e), and the same sized Diet Coke or Coke Zero 150g.
Coke's UK business follows Innocent, which helped the Carbon Trust pioneer its footprinting, and whose 250ml bottle of mango and passion fruit smoothie has a carbon footprint of 209g.
Innocent's co-founder, Richard Reed, questions whether it is fair to compare a bottle of crushed fruit and something largely made of water. Reed's defence highlights a wider issue: how to balance the importance of global warming with other attributes of a product - nutrition, helping poor farmers, careful nurturing of soil, or the welfare of animals. Innocent, for example, donates 10% of profits to charity. "The classical economic response is you implicitly reduce them to a common currency, which leads to money; but my view is these things are just not comparable," said Mike Mason, founder of carbon offset company ClimateCare.
Then there is the issue of what you measure: Coke's cans compare well, but a small glass bottle of the same drink has a footprint of 360g, much higher than Innocent's worst-scoring small bottle of crushed strawberries and bananas (230g).
To resolve these dilemmas, ideas are emerging. Innocent talks of "carbon calories": it calculates that in a world with massively reduced greenhouse gas emissions the average person could afford to eat and drink 2,900g of CO2e each day - and a smoothie would use just 1% of that total.
Mason advocates future labels saying how much carbon is embodied in every pound spent, allowing consumers to compare the impact of anything from a snack to a car.
"Putting an absolute emission on crisps and Aston Martins doesn't tell you very much; using CO2 per pound ... you could grade everything from cars to Coke on the same scale," said Mason.
Biofuels can cut carbon emissions -- but supply is obstacle
By MARA LEMOS STEIN THE WALL STREET JOURNAL ASIA
The aviation industry is scrambling to find ways of reducing its carbon emissions, including testing biofuels in commercial airliners.
Tests so far show biofuels work as well in the air as on the ground. (In other words, they work.) But a host of issues stand in the way of large-scale production of such fuels for aviation, posing economic, environmental and logistical questions that have no easy solutions.
For example, 85% of the cost of jet fuel made from natural oils is the feedstock, or raw materials, says Jennifer Holmgren, general manager for UOP LLC's Renewable Energy & Chemicals business, a Des Plaines, Ill., refining technology developer. But while a liter of crude oil costs about 24 cents, suppliers of exotic oils say that the three main choices being considered for aviation fuel -- using oils from the jatropha and camelina plants, and from algae -- cost about $1.85 a liter, 79 cents a liter and more than $5 a liter, respectively.
Fuels based purely on oils from these plants performed well in test flights by airlines and jet-engine makers in December and January, says Ms. Holmgren. UOP, a unit of Honeywell International Inc., refined the fuel for the New Zealand Air, Continental Airlines and Japan Airlines flights. When burned, the oils produce less soot and particulate matter than regular jet fuel, Ms. Holmgren says. Also, cultivating and refining the oilseeds produces 50% less greenhouse-gas emissions than regular jet-fuel production, she says.
The aviation industry is under pressure to study alternative fuels because, though responsible for only about 3% of global carbon-dioxide emissions, the industry faces a possible emissions cap by the European Union in coming years. The International Air Transport Association has set a goal for its 230 members to use a blend of 10% alternative fuels by 2017. Commercial airplanes will burn 255 billion liters of jet fuel in 2009, down from about 265 billion liters in both 2008 and 2007, according to the association. By 2017, assuming demand for flights rises, considerably more than 26 billion liters of biofuel is likely to be needed to meet the industry's 10% target.
But the amount of land currently needed to grow even 26 billion liters of oilseed suggests that some areas now used to grow food would be converted for fuel crops, experts say. Moreover, any environmental benefits from reducing carbon-dioxide emissions would probably be partially offset by the additional use of irrigation and fertilizers.
Of the three, algae holds the most promise because of its energy yield and ability to grow in ponds and waste water in desert areas, eliminating the land-use dilemma. But the technology to produce enough algae to make billions of liters of fuel is, at best, five to eight years away, industry experts say. In the meantime, some scientists and agricultural economists believe jatropha and camelina have growing traits and potential for yield improvement that can overcome concerns about land use.
Camelina is a small, oil-rich seed that grows in a flowering plant related to rapeseed and mustard. It grows well in dry areas with fewer applications of fertilizers and herbicides.
Camelina seed yields in Montana can reach an average of 1,125 kilograms per hectare on dry land, says Duane Griffith, extension farm management specialist at Montana State University, in Bozeman. As the plant has 40% oil content, that one hectare yields 450 kilograms of oil, or 205 liters, annually. But to grow enough camelina to produce 26 billion liters of biofuel would take 52 million hectares. By contrast, there are 188 million hectares of arable land in the U.S.
Jatropha, a shrub that grows on marginal land in the tropics, has drawn the attention of development economists because of its potential to lift communities in Africa and Southeast Asia from poverty if it becomes a major feedstock for biofuel.
New York-based Terasol Energy Inc., which provided the jatropha oil refined by UOP for the test flights, says farmers in India and Tanzania currently can harvest just over five metric tons of seed per hectare without fertilizers or herbicides, yielding about 2,300 liters of oil per hectare. Sanjay Pringle, president of Terasol, which is developing alternative oilseed crops for biofuel and for specialty-chemical industries, says India has potentially identified 11 million hectares and Brazil about eight million hectares that could be used to grow jatropha.
Given the challenges of achieving commercial scale for any single oilseed crop, investors and industry experts say the answer may be to develop a catalog of oils instead of picking a single winning crop.
Write to Mara Lemos Stein at mara.lemos-stein@dowjones.com
The aviation industry is scrambling to find ways of reducing its carbon emissions, including testing biofuels in commercial airliners.
Tests so far show biofuels work as well in the air as on the ground. (In other words, they work.) But a host of issues stand in the way of large-scale production of such fuels for aviation, posing economic, environmental and logistical questions that have no easy solutions.
For example, 85% of the cost of jet fuel made from natural oils is the feedstock, or raw materials, says Jennifer Holmgren, general manager for UOP LLC's Renewable Energy & Chemicals business, a Des Plaines, Ill., refining technology developer. But while a liter of crude oil costs about 24 cents, suppliers of exotic oils say that the three main choices being considered for aviation fuel -- using oils from the jatropha and camelina plants, and from algae -- cost about $1.85 a liter, 79 cents a liter and more than $5 a liter, respectively.
Fuels based purely on oils from these plants performed well in test flights by airlines and jet-engine makers in December and January, says Ms. Holmgren. UOP, a unit of Honeywell International Inc., refined the fuel for the New Zealand Air, Continental Airlines and Japan Airlines flights. When burned, the oils produce less soot and particulate matter than regular jet fuel, Ms. Holmgren says. Also, cultivating and refining the oilseeds produces 50% less greenhouse-gas emissions than regular jet-fuel production, she says.
The aviation industry is under pressure to study alternative fuels because, though responsible for only about 3% of global carbon-dioxide emissions, the industry faces a possible emissions cap by the European Union in coming years. The International Air Transport Association has set a goal for its 230 members to use a blend of 10% alternative fuels by 2017. Commercial airplanes will burn 255 billion liters of jet fuel in 2009, down from about 265 billion liters in both 2008 and 2007, according to the association. By 2017, assuming demand for flights rises, considerably more than 26 billion liters of biofuel is likely to be needed to meet the industry's 10% target.
But the amount of land currently needed to grow even 26 billion liters of oilseed suggests that some areas now used to grow food would be converted for fuel crops, experts say. Moreover, any environmental benefits from reducing carbon-dioxide emissions would probably be partially offset by the additional use of irrigation and fertilizers.
Of the three, algae holds the most promise because of its energy yield and ability to grow in ponds and waste water in desert areas, eliminating the land-use dilemma. But the technology to produce enough algae to make billions of liters of fuel is, at best, five to eight years away, industry experts say. In the meantime, some scientists and agricultural economists believe jatropha and camelina have growing traits and potential for yield improvement that can overcome concerns about land use.
Camelina is a small, oil-rich seed that grows in a flowering plant related to rapeseed and mustard. It grows well in dry areas with fewer applications of fertilizers and herbicides.
Camelina seed yields in Montana can reach an average of 1,125 kilograms per hectare on dry land, says Duane Griffith, extension farm management specialist at Montana State University, in Bozeman. As the plant has 40% oil content, that one hectare yields 450 kilograms of oil, or 205 liters, annually. But to grow enough camelina to produce 26 billion liters of biofuel would take 52 million hectares. By contrast, there are 188 million hectares of arable land in the U.S.
Jatropha, a shrub that grows on marginal land in the tropics, has drawn the attention of development economists because of its potential to lift communities in Africa and Southeast Asia from poverty if it becomes a major feedstock for biofuel.
New York-based Terasol Energy Inc., which provided the jatropha oil refined by UOP for the test flights, says farmers in India and Tanzania currently can harvest just over five metric tons of seed per hectare without fertilizers or herbicides, yielding about 2,300 liters of oil per hectare. Sanjay Pringle, president of Terasol, which is developing alternative oilseed crops for biofuel and for specialty-chemical industries, says India has potentially identified 11 million hectares and Brazil about eight million hectares that could be used to grow jatropha.
Given the challenges of achieving commercial scale for any single oilseed crop, investors and industry experts say the answer may be to develop a catalog of oils instead of picking a single winning crop.
Write to Mara Lemos Stein at mara.lemos-stein@dowjones.com
Spain's Acciona Shifts Operations, Plans to Focus on Renewable Energy
MARCH 9, 2009
By BERND RADOWITZ
MADRID -- Spanish conglomerate Acciona SA is shuffling operations to focus on renewable energy in a move to capitalize on eco-friendly government incentives in the U.S. and the European Union, as the recession batters its real-estate, energy and infrastructure businesses.
Acciona Energía
Acciona Tatanka wind park stretching from North Dakota to South Dakota.
The timing is precarious. While governments are offering tax credits and other incentives that should create value for shareholders, Acciona is weighed down by a still-hefty debt load. The success of its strategy depends on its ability to build additional capacity.
The company also lags behind its peers in the renewable-energy sector, especially in the U.S., where most of the new wind power is expected to be added in coming years.
Acciona has sharply boosted its renewable-energy generation capacity thanks to a recent deal to sell its 25% stake in Spanish power company Endesa SA to Italy's Enel SpA, which already owned a 67% stake in Endesa.
As part of the €11.11 billion ($13.95 billion) deal with Enel, agreed on last month, Acciona will receive 2,105 megawatts in renewable-energy generation capacity from Endesa. Of that amount, 1,248 megawatts are in wind power. The added capacity will boost Acciona's overall wind-power capacity to 5,814 megawatts, making it the world's third-largest wind-power producer after Spain's Iberdrola Renovables SA and FPL Energy, a unit of U.S.-based FPL Group Inc.
Acciona is becoming a "world leader in renewable energy at a time of strong support of different governments for renewables," said Juan Muro-Lara, the company's managing director for corporate development.
The EU aims to reach 20% of primary energy consumption from renewables by 2020. Each of the bloc's 27 member countries has different legislation on how to boost renewables output, but most apply some kind of guaranteed minimum tariff for electricity from renewable sources.
Meanwhile, President Barack Obama aims to double U.S. renewable-energy generation capacity within three years. Toward that goal, Congress in February approved a mixture of tax credits, grants, loans and loan guarantees that will benefit companies such as Acciona.
Acciona's drive to strengthen its muscle in renewables in the medium term likely will create value for shareholders, thanks to generous, long-term government aid on both sides of the Atlantic, said Bankinter analyst David García Moral. "Revenue from renewables is much more stable and less subject to economic cycles," Mr. García Moral said. "Renewable power always sells."
In tandem with the focus on renewables, Acciona has been greatly reducing the weight of its real-estate, infrastructure and transportation units, which recently have performed poorly due to the rapid deterioration in Spain's economy. The decline in these areas has punished Acciona's share price, which has plunged 50% in the past 12 months.
In 2006, energy made up 38% of Acciona's earnings before interest, taxes, depreciation and amortization, a key figure watched by analysts that cuts out the effect of expenses and gains. After the sale of the Endesa stake, Acciona estimates that energy will jump to 73% of Ebitda, almost all of that in renewable energy.
Acciona could buy more renewable assets elsewhere, beyond the ones acquired from Endesa, said General Director Juan Sáez.
The company said it plans to invest about €2.2 billion this year, mostly in renewable energy, slightly more than the €2.18 it invested last year excluding Endesa. The company could expand by buying small renewables companies or wind-power assets, Mr. Sáez said, without giving further details.
The immediate effect of the Endesa sale will be a drop in profit, as Endesa accounted for almost a third of Acciona's Ebitda last year.
On the upside, Acciona said its net debt will plunge to €5 billion, down from €17.9 billion at the end of 2008 -- or 4.4 times expected Ebitda from 6.2 times Ebitda. The reduced debt may give the company room to make acquisitions. But the company may not be able to go on a shopping spree just yet.
Even with the reduction in debt, Acciona's finances are still "rather stretched in the current market situation," said Espírito Santo analyst Fernando García. The company may even be forced to cut planned investments, or sell some noncore businesses to improve its financial situation, Mr. García said, adding that the recession could eat into the company's renewable-energy profit at the same time its real-estate and infrastructure units decline.
Write to Bernd Radowitz at bernd.radowitz@dowjones.com
By BERND RADOWITZ
MADRID -- Spanish conglomerate Acciona SA is shuffling operations to focus on renewable energy in a move to capitalize on eco-friendly government incentives in the U.S. and the European Union, as the recession batters its real-estate, energy and infrastructure businesses.
Acciona Energía
Acciona Tatanka wind park stretching from North Dakota to South Dakota.
The timing is precarious. While governments are offering tax credits and other incentives that should create value for shareholders, Acciona is weighed down by a still-hefty debt load. The success of its strategy depends on its ability to build additional capacity.
The company also lags behind its peers in the renewable-energy sector, especially in the U.S., where most of the new wind power is expected to be added in coming years.
Acciona has sharply boosted its renewable-energy generation capacity thanks to a recent deal to sell its 25% stake in Spanish power company Endesa SA to Italy's Enel SpA, which already owned a 67% stake in Endesa.
As part of the €11.11 billion ($13.95 billion) deal with Enel, agreed on last month, Acciona will receive 2,105 megawatts in renewable-energy generation capacity from Endesa. Of that amount, 1,248 megawatts are in wind power. The added capacity will boost Acciona's overall wind-power capacity to 5,814 megawatts, making it the world's third-largest wind-power producer after Spain's Iberdrola Renovables SA and FPL Energy, a unit of U.S.-based FPL Group Inc.
Acciona is becoming a "world leader in renewable energy at a time of strong support of different governments for renewables," said Juan Muro-Lara, the company's managing director for corporate development.
The EU aims to reach 20% of primary energy consumption from renewables by 2020. Each of the bloc's 27 member countries has different legislation on how to boost renewables output, but most apply some kind of guaranteed minimum tariff for electricity from renewable sources.
Meanwhile, President Barack Obama aims to double U.S. renewable-energy generation capacity within three years. Toward that goal, Congress in February approved a mixture of tax credits, grants, loans and loan guarantees that will benefit companies such as Acciona.
Acciona's drive to strengthen its muscle in renewables in the medium term likely will create value for shareholders, thanks to generous, long-term government aid on both sides of the Atlantic, said Bankinter analyst David García Moral. "Revenue from renewables is much more stable and less subject to economic cycles," Mr. García Moral said. "Renewable power always sells."
In tandem with the focus on renewables, Acciona has been greatly reducing the weight of its real-estate, infrastructure and transportation units, which recently have performed poorly due to the rapid deterioration in Spain's economy. The decline in these areas has punished Acciona's share price, which has plunged 50% in the past 12 months.
In 2006, energy made up 38% of Acciona's earnings before interest, taxes, depreciation and amortization, a key figure watched by analysts that cuts out the effect of expenses and gains. After the sale of the Endesa stake, Acciona estimates that energy will jump to 73% of Ebitda, almost all of that in renewable energy.
Acciona could buy more renewable assets elsewhere, beyond the ones acquired from Endesa, said General Director Juan Sáez.
The company said it plans to invest about €2.2 billion this year, mostly in renewable energy, slightly more than the €2.18 it invested last year excluding Endesa. The company could expand by buying small renewables companies or wind-power assets, Mr. Sáez said, without giving further details.
The immediate effect of the Endesa sale will be a drop in profit, as Endesa accounted for almost a third of Acciona's Ebitda last year.
On the upside, Acciona said its net debt will plunge to €5 billion, down from €17.9 billion at the end of 2008 -- or 4.4 times expected Ebitda from 6.2 times Ebitda. The reduced debt may give the company room to make acquisitions. But the company may not be able to go on a shopping spree just yet.
Even with the reduction in debt, Acciona's finances are still "rather stretched in the current market situation," said Espírito Santo analyst Fernando García. The company may even be forced to cut planned investments, or sell some noncore businesses to improve its financial situation, Mr. García said, adding that the recession could eat into the company's renewable-energy profit at the same time its real-estate and infrastructure units decline.
Write to Bernd Radowitz at bernd.radowitz@dowjones.com
Clipper struggles as investors put returns above good intentions
By Alisatir Dawber
Monday, 9 March 2009
Green energy is a great idea. The problem for both those trying to produce it, and other businesses serving the nascent industry, is that investors will not support a company simply because it is doing the world a favour.
The analysts pore over the green group's results and market updates in exactly the same way as any other and if there is any sign of weakness, sell notes are sure to follow. Take Clipper Windpower, the AIM-listed company that makes turbines for windmills.
Clipper's share price has fallen by 85 per cent in the last 12 months as analysts have suspected that for various reasons there are better ways for investors to make returns.
In its trading statement at the end of last week, Clipper said: "The current economic and credit conditions in global markets, coupled with lower energy prices, are resulting in reduced capital expenditures by the company's customers and delays in the timing of turbine deliveries. Accordingly, Clipper is planning approximately 15 per cent to 20 per cent lower production levels for 2009." A loss is now expected for the second half of 2008.
The group produces a vital service for the protection of the environment. While it is true to say that Clipper is itself motivated by profit, the fact that investors are getting as far away from AIM as possible is undoubtedly having a knock-on effect on green energy development.
Monday, 9 March 2009
Green energy is a great idea. The problem for both those trying to produce it, and other businesses serving the nascent industry, is that investors will not support a company simply because it is doing the world a favour.
The analysts pore over the green group's results and market updates in exactly the same way as any other and if there is any sign of weakness, sell notes are sure to follow. Take Clipper Windpower, the AIM-listed company that makes turbines for windmills.
Clipper's share price has fallen by 85 per cent in the last 12 months as analysts have suspected that for various reasons there are better ways for investors to make returns.
In its trading statement at the end of last week, Clipper said: "The current economic and credit conditions in global markets, coupled with lower energy prices, are resulting in reduced capital expenditures by the company's customers and delays in the timing of turbine deliveries. Accordingly, Clipper is planning approximately 15 per cent to 20 per cent lower production levels for 2009." A loss is now expected for the second half of 2008.
The group produces a vital service for the protection of the environment. While it is true to say that Clipper is itself motivated by profit, the fact that investors are getting as far away from AIM as possible is undoubtedly having a knock-on effect on green energy development.
Tough odds facing bill to impose carbon tax
By John M. Broder
Published: March 8, 2009
WASHINGTON: Representative John Larson has embarked again on his lonely quest to enact a national tax on carbon dioxide emissions. His idea is to set a modest price on a ton of emissions, gradually increasing it each year until the desired reduction in heat-trapping-gas pollution is achieved.
Under the bill he introduced last week, virtually all the revenues from the tax would be returned to the public in lower payroll taxes.
"The American people want us to level with them," Larson, a moderate Democrat from Connecticut and a member of the House leadership, said in an interview. "We create price certainty without any new bureaucracies or complicated auction schemes."
Many economists and academics, as well as a handful of Larson's colleagues on both sides of the aisle and perhaps a few White House officials, if secretly, agree that a carbon tax is a simpler and more effective means of tackling global warming than the complex cap-and-trade scheme embraced by the Obama administration and most Democratic leaders in Congress.
The supporters of a carbon tax have watched as the new European cap-and-trade system has failed to achieve its emissions goals while prices for carbon permits have gyrated. They see taxing as a more effective means of cutting emissions than cap-and-trade or other hybrid plans now under consideration.
But for a variety of political, environmental and economic reasons, a national carbon tax is probably going nowhere.
Obama and Democratic leaders argue that cap-and-trade, in which polluters must either reduce emissions on their own or buy credits from more-efficient companies, is a better system for assuring reductions, letting the market set the right to pollute.
But the main reason most in Washington recoil from a carbon tax is political: few are willing to openly advocate billions of dollars in new taxes at a time of economic distress, even though a cap-and-trade program also means higher energy prices.
Many congressional Democrats were around in 1993 when President Bill Clinton and Vice President Al Gore pushed an energy tax and then abandoned it after it failed to generate any Republican support. Some noticed last fall when the Liberal Party in Canada suffered its worst loss ever running on a platform that included a national energy tax.
Representative Edward Markey, Democrat of Massachusetts, is leading a special committee writing the House version of climate change legislation. He voted for the 1993 energy tax bill, which is known - not fondly - as the BTU tax, for British thermal unit, a measure of energy output. Markey has since become a faithful follower of the cap-and-trade school.
"I am aware of the economic arguments for a carbon tax," Markey said, "but politics is the art of the possible, and I think cap-and-trade is possible."
Gore, who shared a Nobel Prize for his work on climate change, has long advocated a tax on carbon dioxide emissions as a substitute for taxes on income ("We should tax what we burn, not what we earn," he says).
But in an e-mail messagelast week, Gore said that passage of a tax on carbon "appears to be beyond our reach for the foreseeable future" and that he could accept a cap-and-trade program if it reduced emissions and provided relief for those most burdened by the costs.
"For more than 20 years, I have supported a CO2 tax offset by an equal reduction in taxes elsewhere," Gore wrote. "However, a cap-and-trade system is also essential and actually offers a better prospect for a global agreement, in part because it is difficult to imagine a harmonized global CO2 tax. Moreover, I have long recognized that our political system has special difficulty in considering a CO2 tax even if it is revenue neutral."
Gore and others pointed out that the United States has had a largely successful experiment with cap-and-trade in the acid rain program set up under the 1990 Clean Air Act amendments. That system brought greater pollution reductions and lower costs than expected, although sulfur dioxide and nitrogen oxide pollution from a limited number of power plants was a far simpler problem than carbon emissions will be.
One of the arguments against cap-and-trade is that it requires a complex market for trading pollution permits that could be manipulated by speculators and energy companies. Larson said the last thing the nation needed after its experience with the housing bubble and the banking collapse was a new market in carbon derivatives. His plan, he said, is simpler and fairer.
But cap-and-trade advocates said a carbon tax could also be gamed, just as the Internal Revenue Code is.
Yvo de Boer, who directs the climate change program at the United Nations, said he was agnostic as to how member states meet targets on the emission of heat-trapping gases. But those who support a carbon tax, he said, are walking uphill.
"If you were a pure economist, the most logical thing is taxation. It is the simplest," de Boer said in an interview. "But 'taxation' is a word that makes people choke in normal times. And these are not normal times."
Published: March 8, 2009
WASHINGTON: Representative John Larson has embarked again on his lonely quest to enact a national tax on carbon dioxide emissions. His idea is to set a modest price on a ton of emissions, gradually increasing it each year until the desired reduction in heat-trapping-gas pollution is achieved.
Under the bill he introduced last week, virtually all the revenues from the tax would be returned to the public in lower payroll taxes.
"The American people want us to level with them," Larson, a moderate Democrat from Connecticut and a member of the House leadership, said in an interview. "We create price certainty without any new bureaucracies or complicated auction schemes."
Many economists and academics, as well as a handful of Larson's colleagues on both sides of the aisle and perhaps a few White House officials, if secretly, agree that a carbon tax is a simpler and more effective means of tackling global warming than the complex cap-and-trade scheme embraced by the Obama administration and most Democratic leaders in Congress.
The supporters of a carbon tax have watched as the new European cap-and-trade system has failed to achieve its emissions goals while prices for carbon permits have gyrated. They see taxing as a more effective means of cutting emissions than cap-and-trade or other hybrid plans now under consideration.
But for a variety of political, environmental and economic reasons, a national carbon tax is probably going nowhere.
Obama and Democratic leaders argue that cap-and-trade, in which polluters must either reduce emissions on their own or buy credits from more-efficient companies, is a better system for assuring reductions, letting the market set the right to pollute.
But the main reason most in Washington recoil from a carbon tax is political: few are willing to openly advocate billions of dollars in new taxes at a time of economic distress, even though a cap-and-trade program also means higher energy prices.
Many congressional Democrats were around in 1993 when President Bill Clinton and Vice President Al Gore pushed an energy tax and then abandoned it after it failed to generate any Republican support. Some noticed last fall when the Liberal Party in Canada suffered its worst loss ever running on a platform that included a national energy tax.
Representative Edward Markey, Democrat of Massachusetts, is leading a special committee writing the House version of climate change legislation. He voted for the 1993 energy tax bill, which is known - not fondly - as the BTU tax, for British thermal unit, a measure of energy output. Markey has since become a faithful follower of the cap-and-trade school.
"I am aware of the economic arguments for a carbon tax," Markey said, "but politics is the art of the possible, and I think cap-and-trade is possible."
Gore, who shared a Nobel Prize for his work on climate change, has long advocated a tax on carbon dioxide emissions as a substitute for taxes on income ("We should tax what we burn, not what we earn," he says).
But in an e-mail messagelast week, Gore said that passage of a tax on carbon "appears to be beyond our reach for the foreseeable future" and that he could accept a cap-and-trade program if it reduced emissions and provided relief for those most burdened by the costs.
"For more than 20 years, I have supported a CO2 tax offset by an equal reduction in taxes elsewhere," Gore wrote. "However, a cap-and-trade system is also essential and actually offers a better prospect for a global agreement, in part because it is difficult to imagine a harmonized global CO2 tax. Moreover, I have long recognized that our political system has special difficulty in considering a CO2 tax even if it is revenue neutral."
Gore and others pointed out that the United States has had a largely successful experiment with cap-and-trade in the acid rain program set up under the 1990 Clean Air Act amendments. That system brought greater pollution reductions and lower costs than expected, although sulfur dioxide and nitrogen oxide pollution from a limited number of power plants was a far simpler problem than carbon emissions will be.
One of the arguments against cap-and-trade is that it requires a complex market for trading pollution permits that could be manipulated by speculators and energy companies. Larson said the last thing the nation needed after its experience with the housing bubble and the banking collapse was a new market in carbon derivatives. His plan, he said, is simpler and fairer.
But cap-and-trade advocates said a carbon tax could also be gamed, just as the Internal Revenue Code is.
Yvo de Boer, who directs the climate change program at the United Nations, said he was agnostic as to how member states meet targets on the emission of heat-trapping gases. But those who support a carbon tax, he said, are walking uphill.
"If you were a pure economist, the most logical thing is taxation. It is the simplest," de Boer said in an interview. "But 'taxation' is a word that makes people choke in normal times. And these are not normal times."
Rising sea levels from global warming 'could wipe out Norfolk Broads'
Rising sea levels caused by global warming could destroy the Norfolk Broads and Thames Estuary within a hundred years, climatologists will warn this week.
By Sarah Knapton Last Updated: 4:07PM GMT 08 Mar 2009
Low lying areas of the UK are under threat because the Antarctic and Greenland ice sheets are melting faster than previously thought.
And climate change is also likely to lead to super storms which will batter the coastlines of Britain.
Cities including London, Hull and Portsmouth are all likely to need new defences to prevent devastating flooding.
The dire warning will be made at a climate change conference in Copenhagen this week.
Dr David Vaughan of the British Antarctic Survey told the Observer: "It is now clear that there are going to be massive flooding disasters around the globe.
"Populations are shifting to the coast, which means that more and more people are going to be threatened by sea level rises."
Original predictions suggested sea-level was likely to rise between 20 and 60cm by 2100, but failed to take into account the impact of melting ice-sheets because the data was not understood.
Revised estimates suggest sea-level rises could top one meter by 2100, a figure backed up by the US Geological Survey who said it could reach up to 1.5m.
And storms caused by climate change could see super tidal surges hitting the UK coastline. East Anglia, the Thames Estuary and low-lying cities are all at risk without huge investment.
Dr Colin Brown, of the Institution of Mechanical Engineers said: "Climate change shows there will be significant increases in storms as global temperatures rise. These will produce much more intense gales and hurricanes and these, in turn, will produce massive storm surges as they pass over the sea."
In a report published last month, the IMechE warned that the country will face massive disruption to its transport and energy systems. Many rail lines run along valleys which will be flooded.
The IMechE has warned that many areas of the country may have to be abandoned because they are too expensive to protect.
By Sarah Knapton Last Updated: 4:07PM GMT 08 Mar 2009
Low lying areas of the UK are under threat because the Antarctic and Greenland ice sheets are melting faster than previously thought.
And climate change is also likely to lead to super storms which will batter the coastlines of Britain.
Cities including London, Hull and Portsmouth are all likely to need new defences to prevent devastating flooding.
The dire warning will be made at a climate change conference in Copenhagen this week.
Dr David Vaughan of the British Antarctic Survey told the Observer: "It is now clear that there are going to be massive flooding disasters around the globe.
"Populations are shifting to the coast, which means that more and more people are going to be threatened by sea level rises."
Original predictions suggested sea-level was likely to rise between 20 and 60cm by 2100, but failed to take into account the impact of melting ice-sheets because the data was not understood.
Revised estimates suggest sea-level rises could top one meter by 2100, a figure backed up by the US Geological Survey who said it could reach up to 1.5m.
And storms caused by climate change could see super tidal surges hitting the UK coastline. East Anglia, the Thames Estuary and low-lying cities are all at risk without huge investment.
Dr Colin Brown, of the Institution of Mechanical Engineers said: "Climate change shows there will be significant increases in storms as global temperatures rise. These will produce much more intense gales and hurricanes and these, in turn, will produce massive storm surges as they pass over the sea."
In a report published last month, the IMechE warned that the country will face massive disruption to its transport and energy systems. Many rail lines run along valleys which will be flooded.
The IMechE has warned that many areas of the country may have to be abandoned because they are too expensive to protect.
Energy sector faces 'Scooby-Doo issue', says Ofgem
Mark Milner, industrial editor
The Guardian, Monday 9 March 2009
Ofgem, the industry regulator, is conducting a root-and-branch review of Britain's energy markets and their ability to meet the UK's needs over the coming years.
Britain already faces big challenges in the energy sector as North Sea output declines, which is increasing dependence on imports, while up to a third of power-generating capacity is due to be retired between now and 2015. However, Ofgem is concerned about further challenges, from the impact of the credit crisis to new rules relating to climate change, the development of the European emissions trading scheme and the fallout from the recent row between Russia and Ukraine on gas supply.
Ofgem's chief executive, Alistair Buchanan, said the energy sector was facing what he is dubbing the Scooby-Doo question (based on the cartoon character's voracious appetite for multilayered sandwiches): whether the market would be able to swallow all these issues or whether it will need help to digest them.
Buchanan argues that the long lead times for projects such as the construction of new power plants and gas storage makes it essential for the analysis of the UK's options to be done now and not deferred. "Right now it's 30 minutes to midnight but by 2012 it will be five to midnight and by 2016 it will be midnight," he said.
Ofgem is labelling its review Project Discovery and expects the team responsible to report to the board in summer.
In the wake of the credit crisis, some projects are in doubt as investors show less appetite for risk and lenders impose tougher requirements. The combination of costs and uncertainties over the timing of building new nuclear plants and the development of carbon capture and storage means new gas-generating capacity could become a more attractive option. The team will look at the availability of gas supplies on a best and worst-case basis.
The Guardian, Monday 9 March 2009
Ofgem, the industry regulator, is conducting a root-and-branch review of Britain's energy markets and their ability to meet the UK's needs over the coming years.
Britain already faces big challenges in the energy sector as North Sea output declines, which is increasing dependence on imports, while up to a third of power-generating capacity is due to be retired between now and 2015. However, Ofgem is concerned about further challenges, from the impact of the credit crisis to new rules relating to climate change, the development of the European emissions trading scheme and the fallout from the recent row between Russia and Ukraine on gas supply.
Ofgem's chief executive, Alistair Buchanan, said the energy sector was facing what he is dubbing the Scooby-Doo question (based on the cartoon character's voracious appetite for multilayered sandwiches): whether the market would be able to swallow all these issues or whether it will need help to digest them.
Buchanan argues that the long lead times for projects such as the construction of new power plants and gas storage makes it essential for the analysis of the UK's options to be done now and not deferred. "Right now it's 30 minutes to midnight but by 2012 it will be five to midnight and by 2016 it will be midnight," he said.
Ofgem is labelling its review Project Discovery and expects the team responsible to report to the board in summer.
In the wake of the credit crisis, some projects are in doubt as investors show less appetite for risk and lenders impose tougher requirements. The combination of costs and uncertainties over the timing of building new nuclear plants and the development of carbon capture and storage means new gas-generating capacity could become a more attractive option. The team will look at the availability of gas supplies on a best and worst-case basis.
Climate scientists warn that world is heading for war of the resources
The Times
March 9, 2009
Lewis Smith, Environment Reporter
There is a 50-50 chance of temperature rises reaching dangerous levels over the next century, climate scientists have warned.
Even with heavy cuts in greenhouse gas emissions of 3 per cent a year from 2015, the chance of preventing the temperature rise from exceeding 2C by 2050 is no more than half. And every decade's delay in reducing emissions will cause temperatures to go up by half a degree.
European leaders have made a commitment to limiting rises to 2C because anything above that is expected to damage people's lives and the environment. A 2C increase would in itself cause more heat waves and droughts, many of which could be worse than the 2003 heat wave, which killed thousands of people across Europe.
The warning by researchers at the Met Office Hadley Centre, Exeter, will be made this week at a conference in Copenhagen, which is being held in preparation for a United Nations summit in the city in December, when world leaders will try to agree how to cut gas emissions enough to control climate change.
Jason Lowe, of the Hadley Centre, will present findings showing that gas emissions, including carbon dioxide, should peak by 2015 and fall 3 per cent annually until 2050 if they are to be reduced to half of those in 1990.
The 50 per cent cut by 2050 is seen widely as the minimum necessary for the EU to have a reasonable expectation of limiting temperature rises to 2C. Legislation in Britain imposes a minimum cut in emissions of 80 per cent by 2050.
Dr Lowe is expected to say that if emissions peak in 2015 but are reduced at a rate of only 1 per cent annually, the temperature rise will be 2.9C. If emissions peak in 2035 the average temperature will rise by 4C above pre-industrial levels. Failure to cut emissions at all could leave temperatures to rise by 7.1C by the end of the century.
Scientists fear that temperature rises above 2C would lead to wars over key resources, including water supplies, falls in crop yields in southern Europe and the spread of diseases such as malaria and dengue fever. Almost a third of animal and plant species could become extinct. Warm-water corals are among the species most at risk; animals that will struggle to survive include polar bears and emperor penguins.
Before leaving for Copenhagen, Dr Lowe said: “If global warming continues unabated then the risks of even greater warming are increased, making climate change more dangerous.”
Since 2000 global greenhouse gas emissions have risen between 2 per cent and 3 per cent each year, roughly in line with the rate of increase of the world's gross domestic product. The 0.5 per cent contraction of the global economy has led to greenhouse gas emissions falling by the same amount.
Vicky Pope, head of climate change advice at the Hadley Centre, said that a 2C rise could be delayed but it was extremely unlikely that it could be avoided.
“In order to stabilise at a 2C rise we have to make very drastic cuts,” she said. “But however drastic the emission cuts are, there is going to be a rise in temperatures.
“We are pretty much going to head towards 2C whatever we do. There are some impacts that are already happening and we are going to be living in a very different world.”
March 9, 2009
Lewis Smith, Environment Reporter
There is a 50-50 chance of temperature rises reaching dangerous levels over the next century, climate scientists have warned.
Even with heavy cuts in greenhouse gas emissions of 3 per cent a year from 2015, the chance of preventing the temperature rise from exceeding 2C by 2050 is no more than half. And every decade's delay in reducing emissions will cause temperatures to go up by half a degree.
European leaders have made a commitment to limiting rises to 2C because anything above that is expected to damage people's lives and the environment. A 2C increase would in itself cause more heat waves and droughts, many of which could be worse than the 2003 heat wave, which killed thousands of people across Europe.
The warning by researchers at the Met Office Hadley Centre, Exeter, will be made this week at a conference in Copenhagen, which is being held in preparation for a United Nations summit in the city in December, when world leaders will try to agree how to cut gas emissions enough to control climate change.
Jason Lowe, of the Hadley Centre, will present findings showing that gas emissions, including carbon dioxide, should peak by 2015 and fall 3 per cent annually until 2050 if they are to be reduced to half of those in 1990.
The 50 per cent cut by 2050 is seen widely as the minimum necessary for the EU to have a reasonable expectation of limiting temperature rises to 2C. Legislation in Britain imposes a minimum cut in emissions of 80 per cent by 2050.
Dr Lowe is expected to say that if emissions peak in 2015 but are reduced at a rate of only 1 per cent annually, the temperature rise will be 2.9C. If emissions peak in 2035 the average temperature will rise by 4C above pre-industrial levels. Failure to cut emissions at all could leave temperatures to rise by 7.1C by the end of the century.
Scientists fear that temperature rises above 2C would lead to wars over key resources, including water supplies, falls in crop yields in southern Europe and the spread of diseases such as malaria and dengue fever. Almost a third of animal and plant species could become extinct. Warm-water corals are among the species most at risk; animals that will struggle to survive include polar bears and emperor penguins.
Before leaving for Copenhagen, Dr Lowe said: “If global warming continues unabated then the risks of even greater warming are increased, making climate change more dangerous.”
Since 2000 global greenhouse gas emissions have risen between 2 per cent and 3 per cent each year, roughly in line with the rate of increase of the world's gross domestic product. The 0.5 per cent contraction of the global economy has led to greenhouse gas emissions falling by the same amount.
Vicky Pope, head of climate change advice at the Hadley Centre, said that a 2C rise could be delayed but it was extremely unlikely that it could be avoided.
“In order to stabilise at a 2C rise we have to make very drastic cuts,” she said. “But however drastic the emission cuts are, there is going to be a rise in temperatures.
“We are pretty much going to head towards 2C whatever we do. There are some impacts that are already happening and we are going to be living in a very different world.”
Hopes of climate change accord 'are sinking'
The Times
March 9, 2009
Lewis Smith, Environment Reporter
Two leading climate scientists have broken ranks with their peers to declare that hopes of getting a meaningful deal on halting global warming this year are already lost.
Professor Kevin Anderson, director of the Tyndall Centre for Climate Change Research, and Professor Trevor Davies, one of the centre's founders, told The Times that it was time to start looking for alternatives to an international deal.
They made their comments on the eve of a three-day conference in Copenhagen this week in which thousands of climate change researchers will meet to discuss the latest discoveries in the field. The findings will be used in December when world leaders attend a UN summit, also in Copenhagen, to try to work out an international treaty on greenhouse gas emissions.
Professor Anderson and Professor Davies expect politicians at the summit merely to pay lip service to scientific evidence that greenhouse gas emissions need to be brought under control within a decade, if not sooner. They said that rather than wait for an international accord it was time now to consider what action could be taken.
“We all hope that Copenhagen will succeed but I think it will fail. We won't come up with a global agreement,” Professor Anderson said. “I think we will negotiate, there will be a few fudges and there will be a very weak daughter of Kyoto. I doubt it will be significantly based on the science of climate change.”
He is certain that negotiators will place a heavy reliance on technological solutions that have yet to be invented or proven, rather than recognise the scale and urgency of the problem. Professor Anderson believes that the severity of the likely impacts of climate change has been underplayed, and that to doubt that temperature rises could be limited to 2C is a political heresy.
He said that scientists had been held back from voicing their doubts. “The consequences of the numbers we come up with are politically unacceptable. It's difficult for people to stand up. To rock the boat significantly is difficult for them.”
Professor Davies, Pro-Vice Chancellor of the University of East Anglia (UEA), where the Tyndall Centre is based, shares this assessment and regards geoengineering schemes as a potential insurance policy.
The GeoEngineering Assessment and Research initiative (Gear) has now been set up at UEA to assess the projects that have been suggested. Among the geoengineering solutions that have been proposed are putting mirrors into orbit to reflect sunlight away from Earth, and encouraging the growth of plankton by pouring nutrients into the oceans.
“An increasing number of scientists are talking about Plan B now, the big, global geoengineering things,” Professor Davies said. “That's one of the reasons we've set up this centre - not that we think many of the aspects are sensible but because we think it's necessary to assess them.”
March 9, 2009
Lewis Smith, Environment Reporter
Two leading climate scientists have broken ranks with their peers to declare that hopes of getting a meaningful deal on halting global warming this year are already lost.
Professor Kevin Anderson, director of the Tyndall Centre for Climate Change Research, and Professor Trevor Davies, one of the centre's founders, told The Times that it was time to start looking for alternatives to an international deal.
They made their comments on the eve of a three-day conference in Copenhagen this week in which thousands of climate change researchers will meet to discuss the latest discoveries in the field. The findings will be used in December when world leaders attend a UN summit, also in Copenhagen, to try to work out an international treaty on greenhouse gas emissions.
Professor Anderson and Professor Davies expect politicians at the summit merely to pay lip service to scientific evidence that greenhouse gas emissions need to be brought under control within a decade, if not sooner. They said that rather than wait for an international accord it was time now to consider what action could be taken.
“We all hope that Copenhagen will succeed but I think it will fail. We won't come up with a global agreement,” Professor Anderson said. “I think we will negotiate, there will be a few fudges and there will be a very weak daughter of Kyoto. I doubt it will be significantly based on the science of climate change.”
He is certain that negotiators will place a heavy reliance on technological solutions that have yet to be invented or proven, rather than recognise the scale and urgency of the problem. Professor Anderson believes that the severity of the likely impacts of climate change has been underplayed, and that to doubt that temperature rises could be limited to 2C is a political heresy.
He said that scientists had been held back from voicing their doubts. “The consequences of the numbers we come up with are politically unacceptable. It's difficult for people to stand up. To rock the boat significantly is difficult for them.”
Professor Davies, Pro-Vice Chancellor of the University of East Anglia (UEA), where the Tyndall Centre is based, shares this assessment and regards geoengineering schemes as a potential insurance policy.
The GeoEngineering Assessment and Research initiative (Gear) has now been set up at UEA to assess the projects that have been suggested. Among the geoengineering solutions that have been proposed are putting mirrors into orbit to reflect sunlight away from Earth, and encouraging the growth of plankton by pouring nutrients into the oceans.
“An increasing number of scientists are talking about Plan B now, the big, global geoengineering things,” Professor Davies said. “That's one of the reasons we've set up this centre - not that we think many of the aspects are sensible but because we think it's necessary to assess them.”
Wind farms seek state aid to keep moving
Terry Macalister
guardian.co.uk, Sunday 8 March 2009 18.19 GMT
Britain's wind industry is calling for government support to shield it from the falling pound and ensure existing wind farm projects go ahead. The British Wind Energy Association is to submit a list of demands ahead of next month's budget calling for government loan guarantees and other measures amid City forecasts that the global wind industry is heading for a 20% decline this year.
The UK sector has won a deeper level of subsidies to make the recently launched third round of offshore wind licensing more attractive, but argues wider action is still required to save existing schemes.
Adam Bruce, chairman of the BWEA, said urgent action was required: "If this [downturn] had happened two years ago it might have killed the industry. It is much more robust now, but clearly there are schemes that are under threat unless help can be obtained."
The BWEA says it cannot confirm what kind of help it wants from ministers because this is still being worked out, but loan guarantees and specific aid from the European Investment Bank might be in the mix. The industry says it would also like some short-term financial support similar to what the government is providing for the private finance initiative (PFI).
A key difficulty faced by British wind farm developers is that all turbines are imported when the value of the pound is very low against the dollar and euro. Vestas, Britain's biggest turbine maker, ships equipment from Denmark, pushing up the relative cost for UK wind developers.
The irony, Bruce says, is that in 2003 Vestas set up a turbine factory at Machrihanish, Scotland, only to close it down last year with the loss of 92 jobs because it said there was too little demand.
Faced with these problems, the Royal Bank of Scotland and other leading backers of British wind farms have been pulling in their horns over project financing.
Centrica, the owner of British Gas and one of the biggest investors in wind with a £4bn programme, has already sounded the alarm over the perilous economics of the industry. The company said late last year that soaring costs, coupled with the rise in the cost of financing, meant that "we need to revisit all our numbers to ensure that our projects are economic before we give them the go-ahead".
Alternative energy analysts at HSBC expect the industry to shrink by 20% this year although they are still hopeful that economic stimulus measures in Britain, the US and China will trigger some kind of bounce back in the second half of 2009.
BP and Shell shook confidence in the UK industry when they abandoned all plans for developing wind farms in Britain last year in favour of the US, where the tax treatment – and planning regime – is considered far more favourable. The exit of Shell was a particular blow because it was backing the world's biggest offshore wind farm, the London Array, off Kent.
guardian.co.uk, Sunday 8 March 2009 18.19 GMT
Britain's wind industry is calling for government support to shield it from the falling pound and ensure existing wind farm projects go ahead. The British Wind Energy Association is to submit a list of demands ahead of next month's budget calling for government loan guarantees and other measures amid City forecasts that the global wind industry is heading for a 20% decline this year.
The UK sector has won a deeper level of subsidies to make the recently launched third round of offshore wind licensing more attractive, but argues wider action is still required to save existing schemes.
Adam Bruce, chairman of the BWEA, said urgent action was required: "If this [downturn] had happened two years ago it might have killed the industry. It is much more robust now, but clearly there are schemes that are under threat unless help can be obtained."
The BWEA says it cannot confirm what kind of help it wants from ministers because this is still being worked out, but loan guarantees and specific aid from the European Investment Bank might be in the mix. The industry says it would also like some short-term financial support similar to what the government is providing for the private finance initiative (PFI).
A key difficulty faced by British wind farm developers is that all turbines are imported when the value of the pound is very low against the dollar and euro. Vestas, Britain's biggest turbine maker, ships equipment from Denmark, pushing up the relative cost for UK wind developers.
The irony, Bruce says, is that in 2003 Vestas set up a turbine factory at Machrihanish, Scotland, only to close it down last year with the loss of 92 jobs because it said there was too little demand.
Faced with these problems, the Royal Bank of Scotland and other leading backers of British wind farms have been pulling in their horns over project financing.
Centrica, the owner of British Gas and one of the biggest investors in wind with a £4bn programme, has already sounded the alarm over the perilous economics of the industry. The company said late last year that soaring costs, coupled with the rise in the cost of financing, meant that "we need to revisit all our numbers to ensure that our projects are economic before we give them the go-ahead".
Alternative energy analysts at HSBC expect the industry to shrink by 20% this year although they are still hopeful that economic stimulus measures in Britain, the US and China will trigger some kind of bounce back in the second half of 2009.
BP and Shell shook confidence in the UK industry when they abandoned all plans for developing wind farms in Britain last year in favour of the US, where the tax treatment – and planning regime – is considered far more favourable. The exit of Shell was a particular blow because it was backing the world's biggest offshore wind farm, the London Array, off Kent.
U.S. green push: its own buildings
MARCH 9, 2009
Properties owned by government are perfect place to start
By SARI KRIEGER THE WALL STREET JOURNAL ASIA
The U.S. government's huge inventory of properties is likely to be at the forefront of a national green-building push that will serve two aims of the Obama administration: promoting energy efficiency and boosting infrastructure spending as a way to revive the economy.
In a speech Jan. 8 at George Mason University in Fairfax, Va., then President-elect Barack Obama said he wanted to modernize 75% of existing federal buildings. Much of this modernization is likely to be energy-efficiency measures, and the stimulus package signed into law last month includes billions of dollars for such efforts. The government owns or leases more than 500,000 properties, according to the Department of Energy -- a number that could mean a big impact.
Green-building proponents are hoping that the government's effort will help spur more action in the private sector -- and that wider implementation of green practices will help drive down costs. While green building became increasingly popular in the private sector in recent years, the recession has made the upfront capital costs of both new green construction and renovations less attractive these days for some companies.
Green building refers practices such as the use of environmentally friendly materials in new construction and improvements in the energy efficiency of existing buildings through measures such as installing windows that retain or deflect heat as well as more-efficient heating and cooling systems and lighting.
The Obama administration's plans are being helped, in part, by the Energy Independence and Security Act of 2007, which requires the secretary of energy to revise efficiency standards for all new federal buildings as well as those undergoing major renovations to require the elimination of fossil-fuel energy use by 2030.
"It's not only at a time when the administration is strongly behind doing something, but also the regulations to do something are there," says Bob Dixon, head of the efficiency and sustainability business for Siemens Building Technologies, part of Germany's Siemens AG. "And certainly through some of the stimulus package, we should have some of the funds to support the implementation."
The U.S. Green Building Council, a nonprofit that promotes and certifies green building practices, estimates that green building measures could save the U.S. government billions of dollars in energy costs. "The federal government spends about $4 billion on energy each year for its affordable-housing stock alone," says Jason Hartke, director of advocacy and public policy for the council. "If [the government] were to make...federal affordable-housing stock more energy efficient by 25%, [it would] save $1 billion annually. In 10 years, the government would save $10 billion."
Many experts say the federal government's green building activities could help spur greater adoption of green building techniques by cash-strapped private-sector companies.
Properties owned by government are perfect place to start
By SARI KRIEGER THE WALL STREET JOURNAL ASIA
The U.S. government's huge inventory of properties is likely to be at the forefront of a national green-building push that will serve two aims of the Obama administration: promoting energy efficiency and boosting infrastructure spending as a way to revive the economy.
In a speech Jan. 8 at George Mason University in Fairfax, Va., then President-elect Barack Obama said he wanted to modernize 75% of existing federal buildings. Much of this modernization is likely to be energy-efficiency measures, and the stimulus package signed into law last month includes billions of dollars for such efforts. The government owns or leases more than 500,000 properties, according to the Department of Energy -- a number that could mean a big impact.
Green-building proponents are hoping that the government's effort will help spur more action in the private sector -- and that wider implementation of green practices will help drive down costs. While green building became increasingly popular in the private sector in recent years, the recession has made the upfront capital costs of both new green construction and renovations less attractive these days for some companies.
Green building refers practices such as the use of environmentally friendly materials in new construction and improvements in the energy efficiency of existing buildings through measures such as installing windows that retain or deflect heat as well as more-efficient heating and cooling systems and lighting.
The Obama administration's plans are being helped, in part, by the Energy Independence and Security Act of 2007, which requires the secretary of energy to revise efficiency standards for all new federal buildings as well as those undergoing major renovations to require the elimination of fossil-fuel energy use by 2030.
"It's not only at a time when the administration is strongly behind doing something, but also the regulations to do something are there," says Bob Dixon, head of the efficiency and sustainability business for Siemens Building Technologies, part of Germany's Siemens AG. "And certainly through some of the stimulus package, we should have some of the funds to support the implementation."
The U.S. Green Building Council, a nonprofit that promotes and certifies green building practices, estimates that green building measures could save the U.S. government billions of dollars in energy costs. "The federal government spends about $4 billion on energy each year for its affordable-housing stock alone," says Jason Hartke, director of advocacy and public policy for the council. "If [the government] were to make...federal affordable-housing stock more energy efficient by 25%, [it would] save $1 billion annually. In 10 years, the government would save $10 billion."
Many experts say the federal government's green building activities could help spur greater adoption of green building techniques by cash-strapped private-sector companies.
Expansion of LNG threatens gas glut
By Ed Crooks
Published: March 8 2009 18:44
A huge expansion of global capacity for producing liquefied natural gas is set to bring additional volumes on to an already depressed global market.
Plants scheduled to come on stream over the next year will increase global LNG production capacity by 30 per cent, putting downward pressure on natural gas prices worldwide, particularly in the US and Britain.
LNG – gas super-cooled to -160°C so that it can be transported by tanker – has been the fastest-growing fossil fuel of the past decade. It provides only about 7 per cent of global gas supply but plays an increasingly important role in meeting marginal demand.
A wave of LNG projects approved in the middle of the decade – in particular the vast facilities in gas-rich Qatar – is due to come on stream this year and next.
Some of their production has already been sold on long-term contracts but much of it will go into spot markets, where prices have fallen steeply over the past year.
Professor Jonathan Stern of the Oxford Institute for Energy Studies said that gas demand had “gone off a cliff” worldwide, with electricity generators and industrial users such as car manufacturers cutting their use sharply.
Prof Stern estimated that Asian and European markets could shrink by 10 per cent this year.
Asian buyers are using flexibility in their contracts to take less gas, leaving sellers to look for markets in the US and Europe.
Several new terminals for receiving LNG are also coming into operation in the first half of this year, including Sabine Pass in Louisiana, South Hook in Wales and Rovigo in north-east Italy.
Much of the surplus gas is likely to head for the US. LNG from Qatar costs about $2.50 per million British thermal units to deliver to America, according to Frank Harris of Wood Mackenzie, a consultancy.
That makes it competitive in the US market, where the Henry Hub benchmark price was at a 29-month low of $3.93 per million BTU on Friday.
Mr Harris said that companies with LNG projects due to come on stream this year “would not be rushing hell for leather to get production at full tilt”, and the additional volumes coming on to the market were likely to be well below the planned increase in capacity.
However, projects under construction cannot be deferred indefinitely. So if the new plants do not reach full production this year, they are likely to do so next year. “2010 may be the really horrendous year,” Mr Harris said.
Copyright The Financial Times Limited 2009
Published: March 8 2009 18:44
A huge expansion of global capacity for producing liquefied natural gas is set to bring additional volumes on to an already depressed global market.
Plants scheduled to come on stream over the next year will increase global LNG production capacity by 30 per cent, putting downward pressure on natural gas prices worldwide, particularly in the US and Britain.
LNG – gas super-cooled to -160°C so that it can be transported by tanker – has been the fastest-growing fossil fuel of the past decade. It provides only about 7 per cent of global gas supply but plays an increasingly important role in meeting marginal demand.
A wave of LNG projects approved in the middle of the decade – in particular the vast facilities in gas-rich Qatar – is due to come on stream this year and next.
Some of their production has already been sold on long-term contracts but much of it will go into spot markets, where prices have fallen steeply over the past year.
Professor Jonathan Stern of the Oxford Institute for Energy Studies said that gas demand had “gone off a cliff” worldwide, with electricity generators and industrial users such as car manufacturers cutting their use sharply.
Prof Stern estimated that Asian and European markets could shrink by 10 per cent this year.
Asian buyers are using flexibility in their contracts to take less gas, leaving sellers to look for markets in the US and Europe.
Several new terminals for receiving LNG are also coming into operation in the first half of this year, including Sabine Pass in Louisiana, South Hook in Wales and Rovigo in north-east Italy.
Much of the surplus gas is likely to head for the US. LNG from Qatar costs about $2.50 per million British thermal units to deliver to America, according to Frank Harris of Wood Mackenzie, a consultancy.
That makes it competitive in the US market, where the Henry Hub benchmark price was at a 29-month low of $3.93 per million BTU on Friday.
Mr Harris said that companies with LNG projects due to come on stream this year “would not be rushing hell for leather to get production at full tilt”, and the additional volumes coming on to the market were likely to be well below the planned increase in capacity.
However, projects under construction cannot be deferred indefinitely. So if the new plants do not reach full production this year, they are likely to do so next year. “2010 may be the really horrendous year,” Mr Harris said.
Copyright The Financial Times Limited 2009
Clean-Energy Sector Looks for Private, Public Help
Hit hard by the recession, the clean-energy industry is on the ropes. Governments are injecting stimulus money in hopes of keeping it alive, but what the industry ultimately needs is a far bigger dose of private investment.
In the space of a few months, the recession has slammed the brakes on what had seemed a full-tilt push for new ways to power the planet while emitting less pollution. It has thrown a wrench into the plans of once-booming but still-nascent companies that produce everything from wind power to solar energy to biofuels. The weak economy has whacked the industry in two ways: It has prompted investors to pull back their capital, and it has reversed the rapid run-up in energy prices that for the past few years was fueling much of the industry's growth.
A return to high energy prices probably would spur clean-energy investment again. But one of the forces that was driving up energy prices was the expectation of tougher government limits on greenhouse-gas emissions, which would have burdened the industry with higher costs. In the near term, the recession is likely to slow momentum for those mandates. Politicians are less likely to sock voters with policies that will make energy more expensive when those voters are worried simply about keeping the lights on.
Last week, at ECO:nomics, The Wall Street Journal's annual conference on the business of the environment, clean-energy developers large and small swapped tales of how the recession and the resulting drop in energy prices have hobbled their plans.
"It's wicked timing," William Roe, chief executive of biofuels developer Coskata Inc., said at the conference. Coskata, based near Chicago, is trying to find funding for a plant it is trying to build. But these days, "when you talk to a bank," Mr. Roe said, "all you get is a smile and a pat on the head."
Even T. Boone Pickens is feeling the pinch. The Texas oilman has been spending millions of dollars to drum up support for his "Pickens Plan." It envisions developing big new wind farms to generate electricity as a way to free up U.S. natural gas to power truck fleets -- and, in turn, to curb U.S. demand for imported oil. But Mr. Pickens has been forced to scale back his own plans to develop a massive wind farm in Texas.
Two years ago, Mr. Pickens was hoping to build a 4,000-megawatt wind farm in his home state, and investors were "lined up wanting to finance it" because energy prices were so high, he said. Now, with natural-gas prices having fallen by more than half, it's unclear when the project will grow beyond its first 1,000-megawatt phase.
As oil prices surged and greenhouse-gas emissions took a higher place on the political agenda, spending by public and private sources to develop renewable energy and improve energy efficiency surged to $155 billion in 2008 from $34.1 billion in 2004, according to New Energy Finance, a London consulting firm. When the recession dried up financing for big projects and deflated energy prices, the clean-energy race ran out of gas.
The economic-stimulus plans rolling out everywhere from the U.S. to Europe to China seek partly to breathe new life into the global clean-energy campaign. But because the global energy system is so huge, even billions of dollars of short-term government money won't matter much unless it's able to get hundreds of billions of dollars in long-term private investment flowing into clean energy again.
The $787 billion U.S. stimulus plan contains some $94.1 billion over 10 years for clean energy, for everything from plugging energy leaks in old houses to building more wind turbines, according to a study by HSBC. But the public money will work only if it can get private investment "off the sidelines and get the commercial banks to lend again to good projects," Matthew Rogers, the Department of Energy official who oversees the department's stimulus spending, said at the conference Friday.
The International Energy Agency estimates that annual global spending on renewable energy and energy efficiency would have to average $542 billion through 2030 to prevent atmospheric concentrations of carbon dioxide, a greenhouse gas, rising to a level many scientists say would trigger particularly dangerous consequences from climate change.
One thing government could do is lay out policies to convince private investors that clean energy is still a smart long-term investment. It appears likely to do that, eventually. But the coming year is likely to feature heated and historic debates over how the details of those policies should shake out.
One likely fight will be over the prospect of forcing companies to pay to emit carbon dioxide, probably through a "cap and trade" system. Under such a system, the government would print permits entitling industry to emit a set number of tons of greenhouse gases every year; companies would buy and sell those permits, launching a race to curb emissions at the lowest cost. Exactly how that policy is drawn would determine how much it would raise electricity prices and which Americans would bear the brunt of that bill.
For now, the clean-energy industry is reaching for any lifeline it can get. At the Journal's conference, when Mr. Rogers finished speaking and stepped off the stage, dozens of clean-energy entrepreneurs swarmed around him, handing him their business cards in hope of a shot at some short-term government relief.
Write to Jeffrey Ball at jeffrey.ball@wsj.com
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