Thursday, 9 April 2009

Climate change is too big a problem to be left to the environmentalists

The environmental movement does not have sufficient public support to secure action on the scale needed – charities, churches, schools, the health sector, unions can all play their part

Stephen Hale, Wednesday 8 April 2009 15.29 BST

Individual actions matter. But only governments can save us from catastrophic climate change. There is far more that our political leaders could and should do, right now, to accelerate investment in low-carbon energy, housing and transport infrastructure and help individuals to do more to tackle climate change. Our leaders have considerably more power than they choose to acknowledge. But it's abundantly clear that they will not act at the necessary scale and speed without far greater public pressure. There are deep structural reasons why governments have not delivered on climate change. It's time to face up to them, and to develop new strategies that overcome these obstacles.
These obstacles start with the paradox of climate change itself: the devastating effects of our emissions today will be experienced by others in the future and in other parts of the world, and reduce the incentive for our politicians to act. Then there is the impact of short-term electoral cycles, limited national power in the face of global markets and the lack of effective institutions to agree a global response. Finally, there's a combination of vested interests and deep ideological hostility that limits regulation and other government actions that are urgently needed. It's a recipe for political inertia.
So we need to bring about a dramatic shift in the politics of climate change. That won't come from within the political establishment, or from the private sector. As history tells us, it will only come through pressure from a deeply committed and wide ranging social movement demanding action.
This movement will not be primarily "environmental". The modern environmental movement has played a vital role in making climate change an issue of public and political concern, and achieved remarkable shifts on a host of issues. But climate change threatens all our futures, not just those of environmentalists.
The environmental movement does not yet command sufficient public support to secure action on the scale needed, an argument put provocatively by Ted Nordhaus and Michael Shellenberger in Death of Environmentalism. In their new book, Breakthrough, they argue for a massive surge in public spending on climate change that will create new jobs and opportunities. I support many of their policy proposals. But they neglect the need to build a broad-based movement, which will drive demand for these policies.
We need a new approach that triggers mobilisation on this scale. It won't happen purely through individual action, as some claim. It will be the result of actions by organisations across the third sector, which enable people to take meaningful action together rather than isolated contributions. The potential characteristics of this movement are sketched out in the pamphlet I published in November — Climate change: why we are failing and how we will succeed.
The new movement for action is already emerging. It unites a wide range of groups, who recognise that climate change is the definitive social and economic issue of our time. Organisations concerned with issues from international development and security to health and housing are speaking out on climate change, because they see the potential impact on their concerns and the opportunities for them if we can get this right. Important new initiatives are underway to foster this understanding in other sectors.
Charities, churches, schools, the health sector, unions and other groups can all provide opportunities for action, as they do on so many other issues. They can establish climate change in the public mind as an issue of poverty, housing, health, security and well-being as well as the environment; they can deepen commitment and action at community, local and regional level; they can create a movement of people living low-carbon lifestyles and setting an example to others; and mobilise across borders.
A new task force, announced last week, will help to identify how the third sector can play a far greater role in tackling climate change and environmental issues. The Task Force on the Third sector, climate change and the environment, was announced by Defra, the Department for Energy and Climate Change, and the Office of the Third Sector. The National Council for Voluntary Organisations has more information on the task force, and how to apply.
We need new approaches now more than ever. The growing momentum of recent years halted in 2008. Climate change slipped down the political agenda, pushed back above all by the chaos in the global economy. Politicians are increasingly preoccupied with improving public confidence and economic performance in the short-term, as they feel the squeeze of the credit crisis, rising resource prices, and the economic downturn. But there will be no long-term route out of recession unless we build a low-carbon economy.
Like governments, the third sector often struggles to work effectively across organisational boundaries. But on current trends climate change will roll back the progress that has been made on poverty, housing, health, security and many other issues. It is profoundly in the interests of those concerned with these issues to make their particular contributions to the struggle against climate change. We all have a huge vested interest in this struggle. Action on climate change is too important to leave to environmentalists.
Stephen Hale is director of Green Alliance, an independent organisation working to make environmental solutions a priority in British politics

White House Flexibility Signaled on Climate Bill

WASHINGTON -- The White House is open to compromise on certain key elements of its climate-change agenda, including whether businesses could get some emissions allowances for free, administration officials said Wednesday.

Barack Obama
"[The president's] preferred approach was 100% auction to create incentives for companies to reduce their greenhouse-gas emissions," said White House spokesman Ben LaBolt. "Members of Congress are looking at a variety of policy options to help us make that transition, and the administration will be flexible during the policy-making process as long as those larger goals" of a clean-energy economy, "green" job creation and cutting oil imports are met, he said in an email.
Many lawmakers have warned that passing a climate bill will be difficult if the administration sticks to a position that all of the greenhouse-gas emissions allowances under a so-called cap-and-trade system would have to be purchased at auction. Recent Senate votes have indicated that proponents of an economy-wide cap and trade proposal don't yet have the 60 votes needed in the Senate to overcome a filibuster.
"The road to success is 60 votes [in the Senate], and so we want to make sure that we're able to address as many members' needs as possible to try to get there," Joseph Aldy, special assistant to the president for energy and the environment, said at an energy conference here Wednesday.

Henry Waxman
President Barack Obama last month backed away from pressing for 100% auction of emission credits, telling the Business Roundtable that it wasn't politically feasible. The president's science adviser said in an interview with the Washington Post Wednesday that a climate bill didn't necessarily have to start with 100% auction, but could work its way there over time.
Rep. Henry Waxman (D., Calif.), chairman of the Energy and Commerce Committee, last week unveiled a 648-page draft climate change and energy bill that will likely become the blueprint for congressional and administration policy efforts. Congressional debate on the Waxman bill and other proposals is expected to begin in earnest when lawmakers return from a break the week of April 20.
Mr. Aldy said the administration had reached out to moderate Democrats in the Senate who have expressed reservations about current proposals to cap greenhouse-gas emissions. Nearly a dozen lawmakers from states with heavier reliance on coal-fired power plants and energy-intensive industries last year blocked a more lenient climate proposal in the Senate.
Many of those same senators have written to Mr. Obama warning against trying to push a bill with 100% auction and outlining some of their concerns. Legislators are concerned that auctioning off so many credits would cost industries too much, and they want a larger portion of the revenue funneled into low-carbon energy technologies and energy-intensive sectors.
In the president's fiscal 2010 budget, the administration proposed cutting greenhouse-gas emissions 83% from 2005 levels by 2050, and auctioning off all of the credits that give the holder the right to emit gases such as carbon dioxide.
Mr. Obama proposed distributing most of the revenue gathered in the auction as tax credits to lower-income households, while siphoning off a fraction to fund clean energy technologies.
Write to Ian Talley at

Carbon bonuses could determine development of a low-carbon economy

National Grid managers to earn bonuses for hitting carbon and financial targets, an initiative which may spread throughout industry and Whitehall

James Murray, Wednesday 8 April 2009 12.30 BST

Bonuses are wrong, right? If our journey over the economic precipice has taught us anything, it is that bonus schemes promote reckless risk taking, create perverse incentives and breed resentment. Your financial reward is your salary, the bonus is keeping your job.
Or was it the scale and structure of the turbo-charged bonuses given to incompetent bankers that created the testosterone-fuelled culture that preceded the crash? Modest bonuses paid out when tangible targets are achieved motivate employees and represent a proven mechanism for sharing the rewards of a well-executed strategy.
It is hardly news that the resolution of this debate will reshape the financial sector over the next few years, but it could also determine the pace at which a low-carbon economy develops.
Having set carbon emission reduction targets in recent years, many firms are now trying to work out how to meet them. Inevitably, they are turning to the mechanisms they deployed to ensure financial targets were met, namely bonuses. Growing numbers of companies are currently investigating the feasibility of carbon budgets and bonuses — schemes where managers are given an annual carbon budget, and then have their promotion prospects and bonuses determined by whether those emission targets are met.
Last month, National Grid became the largest firm to publicly launch a "carbon-based remuneration policy" - or, to translate from the language of the HR department, a carbon bonus scheme. The company announced that to help achieve its target of a 45% reduction in emissions by 2020 it would impose departmental carbon budgets, detailing how much carbon each division can emit. Just as executives' performance was previously gauged against achievement of a financial budget, managers at National Grid will now see their performance – and consequently their promotion prospects, salaries and bonuses – determined by their ability to hit both financial and carbon targets.
National Grid is not alone in investigating this model. Within Whitehall the annual performance reviews that determine the career prospects of senior civil servants now officially include environmental targets. Meanwhile, Mike Duke, recently appointed chief executive at Wal-Mart, used a speech earlier this year to promise those who deliver on the company's environmental targets will be rewarded - and those who don't better watch out.
"You will see that the leaders that get ahead in Wal-Mart will be the ones who demonstrate their commitment to sustainability," he told executives at the company. "You won't be able, in the future, to be viewed in the same way if you put this on the back burner."
And carbon bonuses need not be confined to senior executives. Green consultancy WSP Environmental has trialled a voluntary carbon trading scheme that sees all employees given an annual CO2 allowance of 5.5 tonnes. They then receive a bonus or have to pay a penalty of up to £100 based on the extent to which they come under or over the target. David Symons, a director at the company, admits the 5.5 tonne allowance is pretty generous, but the company will bring the cap down over time and is also investigating the introduction of formal departmental carbon budgets.
On a more prosaic level, many firms have trialled a wide variety of rewards for staff who save energy by turning their computers off, ranging from shopping vouchers to free croissants each day.
Any student of the financial crisis should be able to spot the risks inherent in these schemes. Just as bankers' bonuses encouraged people to take risks and focus on short term gains, there is a danger that offering financial rewards to cut emissions could tempt managers to rush low carbon projects. For example, an exec keen to qualify for their bonus could quickly authorise a new solar panel project, only to find later that an investment in building insulation would have delivered greater carbon savings.
Equally, the absence of universal standards for measuring carbon emissions coupled with the temptation of a carbon bonus could result in unscrupulous executives overstating their emission reductions. Carbon bonuses could soon be followed by carbon fraud.
But despite these risks, carbon budgets and bonuses are set to become a common feature of the corporate landscape. One of the benefits of bonus schemes is that they provide a clearer signal of a board's priorities than a speech at the annual general meeting ever can. The problem with the bankers' bonuses is they were structured to signal to staff that bosses were only interested in short-term gains and did not care how they were achieved.
In contrast, well-structured carbon bonuses based on a robust assessment of a firm's emission reductions would let all employees know that achieving the long-term benefits associated with reduced emissions is a priority for the business that everyone should take seriously. Used in this way, perhaps bonuses aren't so bad after all.
• James Murray is the editor of

London Array wind farm developers seek bailout

European Investment Bank asked to guarantee project to build world's largest offshore wind farm after credit crunch and collapse in energy prices scare off backers
Tim Webb, Wednesday 8 April 2009 19.21 BST

The developers of London Array, the project to build the world's largest offshore wind farm in the Thames estuary, have approached the European Investment Bank for a bailout.
The German energy company E.ON and its Danish partner Dong Energy have yet to commit to providing the £3bn they estimate is needed to build the giant wind farm, whose future hangs in the balance.
A project of this scale has never been built before. A collapse in electricity prices in the last 12 months means it would generate less cash, while the credit crunch has added to the uncertainty. Shell pulled out of the project last summer amid fears over the project's viability.
A spokeswoman for the EIB would not confirm that the bank was in talks with the London Array developers but said: "We are committed to funding offshore wind projects in the UK and are currently in discussions with project promoters who are actively promoting wind projects."
Negotiations are understood to be at an early stage. E.ON does not expect to make a final decision on whether to go ahead with the project until the summer.
The EIB, which has more than €400bn (£360bn) of lending at its disposal, is owned by European Union member countries. Its purpose is to lend to public infrastructure projects which, for example, would help member countries meet their renewable energy targets.
In the UK, the EIB has already offered €100m to Fluor and Scottish and Southern Energy, developers of the £1.3bn Greater Gabbard offshore wind farm.
There are fewer subsidies available for offshore wind farms in the UK compared with elsewhere in Europe, where developers are guaranteed a high price for the electricity they generate in the form of a feed-in tariff. As a result, most UK offshore wind farms that are in the planning stage have been shelved. Paul Golby, chief executive of E.ON UK, admitted recently that the economics of the London Array project were on a "knife-edge".
Energy companies are pressing the government to provide more subsidies to make building offshore wind farms viable. The UK will miss its renewable energy target if London Array and dozens of other offshore projects are not built.

Obama to Look at Climate Engineering

Associated Press
WASHINGTON -- The president's new science adviser said Wednesday that global warming is so dire, the Obama administration is discussing radical technologies to cool Earth's air.
John Holdren told the Associated Press in his first interview since being confirmed last month that the idea of geoengineering the climate is being discussed. One such extreme option includes shooting pollution particles into the upper atmosphere to reflect the sun's rays. Mr. Holdren said such an experimental measure would only be used as a last resort.
"It's got to be looked at," he said. "We don't have the luxury of taking any approach off the table."
Mr. Holdren outlined several "tipping points" involving global warming that could be fast approaching. Once such milestones are reached, such as complete loss of summer sea ice in the Arctic, it increases chances of "really intolerable consequences," he said.
Twice in a half-hour interview, Mr. Holdren compared global warming to being "in a car with bad brakes driving toward a cliff in the fog."
At first, Mr. Holdren characterized the potential need to technologically tinker with the climate as just his personal view. However, he went on to say he has raised it in administration discussions.
Mr. Holdren, a 65-year-old physicist, is far from alone in taking geoengineering more seriously. The National Academy of Science is making climate tinkering the subject of its first workshop in its new multidiscipline climate challenges program. The British parliament has also discussed the idea.
The American Meteorological Society is crafting a policy statement on geoengineering that says "it is prudent to consider geoengineering's potential, to understand its limits and to avoid rash deployment."
Last week, Princeton scientist Robert Socolow told the National Academy that geoengineering should be an available option in case climate worsens dramatically.
But Mr. Holdren noted that shooting particles into the air -- making an artificial volcano as one Nobel laureate has suggested -- could have grave side effects and would not completely solve all the problems from soaring greenhouse gas emissions. So such actions could not be taken lightly, he said.
Still, "we might get desperate enough to want to use it," he added.
Another geoengineering option he mentioned was the use of so-called artificial trees to suck carbon dioxide -- the chief human-caused greenhouse gas -- out of the air and store it. At first that seemed prohibitively expensive, but a re-examination of the approach shows it might be less costly, he said.
Copyright © 2009 Associated Press

Hospitals and schools could be powered by underground heat, says Royal Academy of Engineering

Schools and hospitals in the UK could be powered by tapping heat from under the ground, saving taxpayers thousands of pounds every year, engineers have claimed.

By Louise Gray, Environment Correspondent Last Updated: 5:00PM BST 08 Apr 2009
The UK is sitting on a "vast resource of untapped energy", a Royal Academy of Engineering conference on the potential use of geothermal energy was told.
By using ground source heat pumps, the energy can be transferred from hundreds of feet below the ground to the central heating system, while the same pump can also cool the building by taking heat out of the air in the summer.

The technology is widely used in Scandinavia and the US but has failed to take off in the UK because of the cost and the availability of cheap oil and gas.
Around 350,000 ground source heat pumps are installed in Sweden, providing around 10 per cent of heating needs, compared to just 7,000 in the UK.
However, with fossil fuel prices set to increase in the future and ambitious climate change targets to cut carbon emissions coming into force, the Royal Academy of Engineering believe it is time to re-examine the issue.
David Banks, a consultant engineer, admitted that the £10,000 cost of installing a heat pump for one house was not worth it in the current climate.
However, large public buildings like schools and hospitals can make back the investment of hundreds of thousands of pounds within 10 years.
Homes in rural areas that rely on bringing in heating oil may also be able to make back the money in a relatively short period.
He said: "We are sitting on top of a gigantic, free reservoir of natural heat in the ground – ubiquitous and available to all. "The cost of a ground source heat pump for a large project can be half that per unit of energy than that of a residential scheme. Thus ground source heat can make genuine sense for offices, schools, hospitals and public buildings."
The Government is hoping to cut carbon emissions from buildings by offering subsidies for renewable energy projects and introducing regulations to make all homes carbon neutral by 2016.
Mr Banks predicted, the technology will become widely used in the UK in the next few years, saving taxpayers thousands of pounds in the long run.
"The carrot of government subsidy and stick of planning regulation are forcing developers to consider the ground source heat option," he added.
The conference, called 'The heat beneath your feet', also heard about the potential of geothermal heat in the UK which can heat hundreds of homes at a time.
At the moment there is just one plant sourcing heat from hot rocks deep under the ground in Southampton. However, a new project near Newcastle is about to be installed and there is potential for more plants in the North Pennines, parts of southern England, the eastern Highlands of Scotland, Northern Ireland and Derbyshire in the future.

New era for fossil fuels as first carbon capturing power plant begins work

French power station leading the way in the world's sluggish move towards using environmentally vital CCS technology

Alok Jha, Wednesday 8 April 2009 17.28 BST

The world's first retrofit of a power plant with carbon capture and storage (CCS) technology will begin operating this month in the south of France.
At a power plant at Lacq, energy company Total has upgraded an existing gas-fired boiler with CCS technology – a crucial step towards reducing carbon emissions from fossil-fuel power plants worldwide.
With renewable energy sources a long way from covering the world's increasing demand for energy, many experts believe that developing reliable technology to allow countries to burn fossil fuels without releasing dangerous amounts of CO2 into the atmosphere is essential to avoid the worst impacts of climate change.
Experts welcomed Total's achievement but added that it highlighted how Britain was being left behind in the development of an important technology to head off climate change.
"CCS remains the most important initiative that needs to be implemented both here and around the world in reducing emissions from coal, gas and oil-fired power stations," said Environment Agency chairman Chris Smith.
"[But this project] re-emphasises the importance of making sure that Britain takes an early opportunity to put itself in the lead worldwide in taking the technology forward."
Stuart Haszeldine, professor of geology and an expert in CCS at the University of Edinburgh, was more scathing. "The UK has been first to stoke up interest in CCS, in the 1990s. But since then, CCS has not received any significant government support to make any real projects happen."
He said the technology was essential for the UK to meet its climate change targets. "We have to completely clean up CO2 emissions from gas as well as coal by 2030, if the UK is to meet the legally binding decreases set by the climate change committee," said Haszeldine. "Projects like Lacq will help to make cleanup cheaper and bring that reality closer."
The 60m euro Lacq project will transport and store 60,000 tonnes of carbon dioxide every year in the nearby depleted gas field at Rousse – once the biggest onshore natural gas field in Europe, but which is now almost empty. It is the first to link together all parts of the carbon capture chain from burning natural gas to isolating CO2 from flue gases and burying it underground.
Reusing an existing pipeline that has been transporting natural gas from Rousse to Lacq for 50 years, Total engineers plan to push the carbon dioxide from the power plant in the other direction, injecting the gas into the Rousse reservoir at a depth of around 4,500m. The Lacq project will run for two years, after which engineers will monitor the Rousse gas field to demonstrate that the carbon dioxide remains safely trapped inside.
Last year, the Schwarze Pumpe power station in north Germany became the first demonstration experiment to build a a 12MW fossil fuel-fired boiler from scratch with full CCS – it will bury 100,000 tonnes of CO2 a year 3,000m below the surface of the depleted Altmark gas field.
CCS is seen as the technolology that could save the planet from the expected increased use of coal in power stations around the world. At its best, it could trap up to 90% of a power plant's carbon emissions and, though each element of the capture, transportation and storage process is already proven and in use, only the Schwarze Pumpe plant has put the chain together until now.
Despite agreement from almost all sides that CCS must be made commercial if the world can ever hope to meet its carbon-reduction targets, a full-scale system remains years away, largely because of the costs involved in its development. As a result, many leading power companies have been reluctant to fund CCS individually, arguing that governments should also shoulder some of the financial risks.
The UK government wants to fund a single demonstration plant using post-combustion capture technology and is running a competition to decide which new power station will get the go-ahead. Within the next few weeks, ministers are expected to announce proposals on how to fund further CCS projects in the UK beyond the competition.
But the British government's procrastination has forced many CCS projects planned in the past decade to be abandoned or moved abroad. These include BP's plans to build a carbon capture plant at Peterhead and Centrica's Eston Grange project.
Haszledine also criticised the lack of research effort in the UK, saying just over £6m has been spent on CCS research in the UK in the past decade compared with $2bn to date in Canada, and annual spends of around £40m in Norway and several hundreds of millions of dollars in Australia. New CCS demonstration projects are due to start operating later this year in the United States and Australia.
At Lacq, Total has fitted one of the plant's 30MW gas-fired boilers with oxyfuel technology, where the fossil fuel is burned in an atmosphere enriched with oxygen. The resulting exhaust gas is then composed almost entirely of carbon dioxide and water vapour, which can be easily separated and stored.
"Total needs to master this new technology," said Luc de Marliave, climate change coordinator at the energy company. "Oxycombustion had never been tested at this scale in such an integrated CCS scheme."
Philippe Paelinck of Alstom, the engineeering company that designed and built the CCS equipment at Lacq, said the experiment was an important milestone. "We first proved the feasibility of retrofitting an installation to carbon capture and storage, but also this will be the first demonstration in Europe of CCS with [existing] integrated CO2 pipeline transportation and storage."
De Marliave said Total chose to test oxyfuel because it could potentially save costs in future. "Our calculations showed that, with oxycombustion in that type of application, you could reduce the cost of capture – which is a large part of the cost of the CCS chain – around two-thirds of the cost roughly. For just capture, existing post combustion technologies would cost you something like 70 euros per tonne of CO2. Oxycombustion could reduce this to 35 euros per tonne."
Despite that, he said Total was still open to the investigating the other types of CCS technology, both pre- and post- combustion. "We are not set on one technology. We selected oxycombusiton for the pilot but it doesn't mean that we are not very much interested in post-combustion as well."
Plans for government-funded CCS demonstration plants across Europe have been moving slowly. The EU wants 12 demonstration plants in operation next decade and has reserved 300m carbon credits from the next stage of the European emissions trading scheme to help fund the technology.
In January, the European Commission proposed earmarking €1.25bn to kickstart carbon capture and storage (CCS) at 11 coal-fired plants across Europe, including four in Britain: the Kingsnorth plant in Kent, Longannet in Fife, Tilbury in Essex and Hatfield in Yorkshire would share €250m under the two-year scheme.

Rising costs threaten wind farms

By Fiona Harvey, Environment Correspondent
Published: April 8 2009 23:06

At least five big wind energy projects are in danger of being delayed or shelved owing to higher costs and a shortage of credit, the British Wind Energy Association said on Wednesday.
The projects, which are offshore, amount to about three gigawatts of wind energy capacity or almost a 10th of the amount needed to meet government targets. All were expected to receive final agreement on their funding this year but sterling’s decline has raised the cost of some imported turbine components while project finance conditions have now tightened.

The five include the London Array, the UK’s biggest proposed offshore wind farm, as well as projects in Lincolnshire and Wales.
The rate of new applications to build wind farms was falling and independent onshore developers were struggling to find finance, the BWEA said, while offshore projects were most at risk of delay. Several prominent energy companies have scaled back their commitment to renewables, including BP, Shell and Iberdrola.
Maria McCaffery, chief executive of the BWEA, said: “The current economic climate has caused a number of developers to put projects on hold, threatening the UK’s targets and leaving the country exposed to volatile fossil fuel prices.”
She urged Alistair Darling, the chancellor, to include more support for renewable energy in the Budget. “Building a clean energy sector in the UK is an important part of our economic recovery, and we need to maximise the opportunities to develop sustainable energy projects which would otherwise be delayed by the recession,” she said.
Wind farm developers are also looking to raise funds from the European Investment Bank, which is investing €800m (£723m) a year in renewable energy around Europe. Eon, Dong and Masdar, the owners of the London Array, have applied for funding but if granted it would make up only a small part of the estimated £3bn cost of the project.
Wind farm development costs should have fallen, as lower commodity prices have cut turbine prices. But a weak pound has made imports more expensive, cancelling out the gains.
Copyright The Financial Times Limited 2009

China Sets Electric-Car Plan

BEIJING -- Nissan Motor Co. is expected to agree to help set up an electric-car program in a major Chinese city, in an unusual partnership between the Chinese government and a foreign company to further Beijing's efforts to develop environmentally friendly automobile technology.
Under the deal, which could be signed as early as Friday, Nissan would work with China's Ministry of Industry and Information Technology and the government of Wuhan to cooperate on a pilot electric-vehicle program in the central Chinese city, according to people familiar with the matter.
Nissan is expected to provide free electric vehicles to Wuhan and to help develop a network of vehicle-charging stations, the people said. It isn't clear how many cars or how much money the project involves.
Nissan is partnering with China to start an electric-car program in Wuhan. The company is making a global push for its electric cars, like the Nuvu, above.
Nissan and the industry ministry are also expected to sign a memorandum of understanding to jointly explore ways to make electric vehicles popular in China.
The planned agreements are part of China's efforts to promote vehicles powered at least partly by batteries. China's government is encouraging its own auto industry to shift to such electric vehicles, believing auto makers can use the technology to narrow the gap with bigger foreign rivals. Beijing last month unveiled an auto-industry plan to create capacity to produce 500,000 "new energy" vehicles, such as all-electric battery cars and plug-in electric hybrid vehicles by 2011.
Wuhan, which has a population of nine million, is among 13 cities recently chosen by the Chinese government for a pilot program to boost use of new-energy vehicles. Those cities -- which also include Beijing, Shanghai and Chongqing, the country's biggest municipalities -- are supposed to provide subsidies for purchases of all-electric battery cars, plug-in hybrids and hydrogen-fuel-cell cars. They are expected to collectively put 60,000 new-energy vehicles in service in four years.
The industry ministry believes China could learn from Nissan, an experienced advocate of electric propulsion, which has plans for a big global push for its line of small battery cars, starting in 2010. By that year, the company is expected to start marketing a compact all-electric battery car to corporate-fleet customers in the U.S. and Japan. People familiar with the planned Nissan agreement said the joint effort could be extended to more cities, such as Beijing.
In China, Nissan plans to launch the same compact battery car as early as 2011 and is considering building factories to produce batteries and the entire car in China -- something Nissan wants to accomplish over the next few years to "be cost competitive," according to a senior company executive. Some auto makers believe that by 2020, 10% to 20% of China's passenger-auto sales will come from electric cars, plug-in electric hybrids and other new-energy cars.
The planned Wuhan program is expected to be patterned on a program currently being implemented in Nissan's home prefecture of Kanagawa, just south of Tokyo. Kanagawa plans to install 1,000 charge stations by 2014. Kanagawa Gov. Shigefumi Matsuzawa is expected to deliver a speech Friday at an electric-vehicle forum in Beijing, where the Wuhan plan is expected to be announced.
Write to Norihiko Shirouzu at

Motorists to receive government grants for electric cars

• £2,000 pledge for eco-cars in green economy drive • Brown aims at making industry a world leader
Nicholas Watt, Chief political correspondent
The Guardian, Thursday 9 April 2009

A £2,000 government grant will be provided to encourage motorists to buy electric cars as part of a fresh initiative to stimulate the green economy, ministers will announce within weeks.
As Gordon Brown pledged yesterday to make Britain a "world leader" in the production of electric and hybrid cars, government sources talked of steps to be taken when the special subsidy is announced in the run-up to the budget on 22 April.
The subsidy will have two aims: to help the environment, by encouraging use of the most fuel efficient cars, and to kickstart the market in electric cars in Britain.
One government source said: "We want to encourage people to buy these cars. They are good for the environment - Britain is also a major centre of production."
The subsidy will be similar to grants available for people who install solar thermal and photovoltaic energy equipment in their homes.
Ministers are also considering a "scrappage scheme", whereby motorists receive a £2,000 subsidy towards the costs of a fuel-efficient car in exchange for turning in their old vehicle. An announcement is not expected soon on this scheme because ministers believe it could end up subsidising overseas car producers, since most new vehicles in Britain are imported.
Brown believes it is right to give a subsidy to electric cars because Britain is a large producer of them. Vauxhall is due next year to introduce the Ampera, the British version of the General Motors Chevy Volt plug-in hybrid.
Geoff Hoon, the transport secretary, told the Guardian in January that the government needed to do more to encourage electric cars, which can be seen as unglamorous, or, at the higher end of the market, as overpriced. He recently test-drove an electric sports car, designed by the inventor of Paypal, that accelerates as fast as a Ferrari and runs for 500 miles without being charged. But that vehicle costs £100,000, the battery accounting for £60,000 of the price tag.
Hoon admitted the cars were expensive but said people should be encouraged to buy them. "Electric cars are not milk floats, they can be exciting sports cars, they can be family runabouts, they can replace the petrol-driven engine."
On Tuesday the European Investment Bank approved a £340m loan to Jaguar Land Rover to develop "green" vehicles. A further £373m will go to Nissan, to be split between its plants in Sunderland and Spain, to develop green technology.
Meanwhile, Boris Johnson, the London mayor, yesterday announced plans to ensure that 100,000 electric cars were used in London, covering 5% of the total. This is the same target highlighted by Hoon in his Guardian interview; he said that a 5% switch to electric cars would offset the extra emissions from a new third runway at Heathrow.
The goals, said Johnson, would be to create 25,000 electric charging spaces in London by 2015, convert at least 1,000 Greater London Authority fleet vehicles to electric by 2015, and ensure charging points are installed in all new developments in London. "This is an unprecedented package of measures to make London the electric car capital of Europe. It is time for the government to put its money where its mouth is," he said.

Gordon Brown announces green budget plans

Measures to promote electric cars and other environmental innovations will be major part of 22 April budget, says PM
Andrew Sparrow and agencies, Wednesday 8 April 2009 09.29 BST

Gordon Brown said today that measures to promote electric cars and other green innovations would be a "major part" of the government's plans for recovery being unveiled in the budget later this month.
In an interview with the Independent, the prime minister said the government would announce incentives intended to enable Britain to become a market leader across the world for electric and hybrid cars.
Alistair Darling, the chancellor, is expected to say that trials for electric cars will begin in two or three cities next year. The government will also open negotiations with power companies to ensure that vehicles can be recharged at the roadside.
However, after the warning by the governor of the Bank of England, Mervyn King, that the country could not afford another big "stimulus" package to boost the economy, Brown also acknowledged in the interview that his room for manoeuvre was limited.
"It is not just what we do to give real help to people and business now, but about setting a path for the future as well. We always take into account both what we need to do now and what is best future for the fiscal position," he said.
In a reference to green initiatives in the budget, which will be on Wednesday 22 April, Brown said: "This is a major part of our plan for recovery in the budget. We will set our proposals for greener economy."
He went on: "This is a job creator, a quality of life improver, and an environment-enhancing measure. We want to harness a general desire among people to be part of this. A better Britain means building a greener Britain."
The government is also expected to announce a relaxation of the planning rules to enable the building of more wind farms to ensure the UK meets its target of getting 15% its energy from renewable sources by 2020.