Sunday, 25 October 2009

£3,300 per car: Lord Turner unveils green tax blitz

Danny Fortson

An influential think-tank, supported by the government, will tomorrow urge £150 billion of new green taxes on businesses and households — including a £3,300 levy on new cars.
The recommendations from the Green Fiscal Commission (GFC), to be presented by Lord Turner, head of the committee on climate change — and chairman of the Financial Services Authority — could bring a drastic reshaping of the tax system to curb greenhouse gas emissions and encourage investment in low-carbon technology. Among the proposals are a tripling of fuel duty over the next decade, a household energy tax, and the hefty tax added to the price of every new car.
Greg Barker, the Tory environment spokesman, Alan Whitehead, a Labour MP on the energy select committee, and Chris Huhne, the Liberal Democrat home affairs spokesman, will speak at the launch of the 100-page report from the commission — a body of academics, industrialists and politicians set up to advise government.
The GFC, which is chaired by Robert Napier, chairman of the Met Office, argues for a “fundamental rebalancing of the tax system” based on the “polluter pays” principle.

It wants to double the proportion of green taxes in the overall tax take from the current 7%. The government’s total tax income would not rise because the hikes in green levies would be offset by cuts to income tax and National Insurance contributions.
The report sets out different models for the tax system depending on different commodity-price assumptions and required levels of investment for clean technologies and energy-efficiency measures.
The broad theme is for a raft of new “eco taxes” aimed at curtailing activities, of both individuals and businesses, that use natural resources or create pollution.
Paul Elkins, a professor at University College London and the author of the report, said: “It’s really a question of moving a mindset. We’ve had it as a given that energy is cheap, so we have been wasteful. This has to change and the only way to do that is to make the polluters pay.” Elkins said he was “hopeful” that the recommendations will be adopted by the leading political parties.
Among the most controversial proposals would be a £300 tax on new cars, increasing annually to £3,300 by 2020.
Representatives from the Tories, Liberal Democrats and Labour were closely involved in drafting the report.
The Tories have been briefing power companies on a scheme that would provide £6,500 to every household in Britain to spend on energy-efficiency measures. The sum would come in the form of a low-cost loan to energy suppliers, which would be repaid over several years via contributions through domestic energy bills.

Business faces £370bn bill for climate change

Tricia Holly Davis
British business faces a £370 billion bill by 2020 to meet the cost of fighting climate change, according to estimates to be published ahead of December’s Copenhagen climate-change summit.
The amount would mainly cover the cost of building renewable-energy capacity, smart grids and high-speed rail links. About £40 billion would finance upgrades to Britain’s water distribution and treatment networks.
This is only part of the picture, said the report’s author, Andrew Raingold of Aldersgate Group, a coalition of business and environmental groups.
“These are conservative estimates and don’t include the costs attached to deploying low-carbon vehicles and supporting infrastructure such as charging stations. This could add another few billion to businesses’ total liability,” he said.

Raingold points to a recent analysis by the Policy Exchange, a think tank, which estimates that the UK will need to spend £50 billion every year for 10 years on low-carbon energy and transport to curb greenhouse-gas emissions. This is more than twice the amount Ofgem, the energy regulator, has said is necessary to meet the government’s target of cutting emissions 34% by 2020.
Various estimates on the costs of cutting carbon out of the economy have been published recently.
The reports are being deployed by industry on one side and governments on the other as they attempt to hammer out a new pollution-cutting agreement at the Copenhagen summit.
All sides agree it will be monumentally expensive. They differ on who should pay for it. Raingold said: “Businesses will end up footing the vast majority of the costs of combating climate change because the Treasury doesn’t have the money.”
Governments and many experts argue that the economic impact of a warmer climate and the costs industry will bear if the carbon price increases will be much greater if businesses do nothing. “There is actually a big opportunity to make money if we don’t drag our feet,” said Sir Brian Hoskins of the Committee on Climate Change, the government ’s green watchdog. It estimates that climate change will cost the UK economy 1% of GDP by 2050.
Last week the Worldwide Fund for Nature said global investment of $1 trillion a year was needed across a range of low-carbon technologies, at least for the next decade, and that it would largely have to come from the private sector.
“The upside of flooding the market with so much capital is you cut the cost of green technology, so clean energy becomes competitively priced with fossil fuels,” said Karl Mallon, lead researcher on the Worldwide Fund for Nature report.
Alice Chapple of Forum for the Future, an environmental think tank, said: “To get this level of investment from business, particularly in a recession, is going to require a variety of incentives, removal of fossilfuel subsidies and agreements between governments and business to share the risks of developing new technologies.”
Keith Clarke, chief executive of the Atkins technology consultancy, said: “Businesses can’t afford to not invest in climate change. But the real question is not about how much, it’s about reaching the right agreements to decarbonise our economy and secure investment.”
Today Britain’s low-carbon market is worth £100 billion, with green manufacturing accounting for 30% of that. The government has forecast the market will grow to £150 billion in five years. Even if that forecast is accurate, the UK could still face a substantial funding gap up to 2020.
By then, there must be a fivefold increase in renewable electricity, and 10% of all energy used for road transport must come from renewable sources.
“I doubt the funding will be found,” said Dan Lewis at the Economic Research Council. “The current system is too biased in favour of making a quick buck on intermittent power rather than developing low-carbon technologies, which require much longer time horizons to merit investment.”

Study challenges the idea of global warming wars

John Burns

Al Gore got a Nobel peace prize, in part, for helping to prevent war by highlighting global warming and helping to slow it. In fact, climate change is not likely to cause conflict in the future, according to a study co-authored by Professor Richard Tol of the Economic and Social Research Institute (Esri) in Dublin.
The conclusion challenges predictions made by the likes of Hillary Clinton, the American secretary of state, and John Reid, the former British defence secretary, who have forecast that future conflicts will be caused by rising temperatures. Earlier this year Clinton told her Senate confirmation hearing that climate change is a security threat. “At the extreme, it threatens our very existence,” she said. “But well before that point, it could well incite wars of an old kind over basic resources like food, water and arable land.”
Tol’s study concludes that, if anything, it’s lower temperatures that cause conflicts, and even this link has weakened since the industrial revolution. “This implies that future global warming is not likely to lead to war between European countries,” says the study, published in the Climatic Change journal.
The Esri research professor and a colleague, Sebastian Wagner, investigated the relationship between war in Europe and the continent’s climate between the years 1000 and 2000. They took information on conflicts from, and mapped them against temperature and rainfall records that have been kept throughout Europe since 1500. For earlier centuries, they used indirect information about climate derived from sources such as tree rings and the growth pattern of corals.
The further back they went, the greater the correlation between war and weather. “This confirms the agricultural hypothesis,” the study says. “Agriculture became progressively less important over the period, because of economic development, and agriculture became less dependent on weather, because of improved cultivation methods and better fertilisers.”
The closest link was found between 1300 and 1650, the most violent period of the millennium. “Europe gradually cooled and then warmed over the millennium, while conflict worsened and then waned,” they say.
The finding that periods with lower temperatures in the pre-industrial era were accompanied by violent conflicts is similar to a conclusion reached about China by Professor David Zhang at the University of Hong Kong. He deduced that food scarcity was the reason why more wars were fought during colder periods.
“We do not believe that people fight to keep warm,” Tol and Wagner say. “Rather, temperature and precipitation are proxy variables for agricultural production.”
The authors note that while “scenarios of climate-changeinduced violence can be painted with abandon”, this is because there is “very little research to either support or refute such claims”. Previous studies suggest that resource scarcity is at most a contributory factor rather than a direct cause of war, the study says..
They admit it is possible to imagine a scenario in which climate change leads to battles. Reid predicted, in a speech in 2006, that rising temperatures would lead to declining natural resources, and inevitable clashes over arable land, clean water and energy.
These apocalyptic warnings are based around prolonged droughts in areas such as the Horn of Africa, followed by mass migration in search of clean water. Tol and Wagner argue that this isn’t likely, however. “Drought is only a real problem for the poor; a scenario like this would happen only if warming and drying outpace development,” their study says. “If not, food imports or desalination may be the preferred options. Drought is also a slow-onset disaster. It may exhaust people before they move. Poor and exhausted people are unlikely to take up arms, and if they do, they are probably not very effective. The human suffering would be substantial nonetheless.”
A more plausible scenario of climate change leading to war would be a rapid rise in sea level in a large delta in Asia or Africa. Such coastal plains are usually fertile, and well-populated. Rising sea levels could force people to move to higher ground, setting off conflicts inland.
“In West Africa, for instance, the situation is already so tense that additional refugees are unlikely to do any good — the coasts of Cameroon, Gabon and Nigeria are particularly vulnerable to sea-level rise,” the study says.
“However, these impacts will not be on today’s world. Sixty-six years ago, western Europe was at war. In 2075, south Asia and west Africa may be stable and prosperous.”

Barack Obama in new global warming fight

Stonewalling by opponents means key legislation is unlikely to be in place by Copenhagen summit
Suzanne Goldenberg, US environment correspondent
The Observer, Sunday 25 October 2009
Barack Obama's efforts to forge a new American consensus around the need for action on climate change has run into a brick wall of Republican opposition, with senators threatening a boycott of a proposed law to cut carbon emissions.
The Senate opens a three-day blockbuster of hearings on Tuesday, calling 54 administration officials and environment experts to try to push ahead on a climate change law before a meeting in Copenhagen that is supposed to produce a global action plan on climate change.
With that deadline looming, Obama has made his most forceful appeal to date for Congress to act on climate change. The president said on Friday that Americans had now arrived at a point of convergence on the need to move towards cleaner energy. "I do believe that a consensus is growing," he said. Those still unpersuaded, he said in a speech at Massachusetts Institute of Technology (MIT), were outside the mainstream.
"The naysayers, the folks who would pretend that this is not an issue, they are being marginalised," Obama said. "The closer we get, the harder the opposition will fight and the more we'll hear from those whose interests or ideology run counter to the much-needed action that we're engaged in."
But a threat by a powerful Republican senator to stay away from bill-drafting sessions diminishes the already slim hopes that Congress will pass a law reducing US greenhouse gas emissions before international negotiations in Copenhagen in December.
James Inhofe, the Oklahoma senator who gained notoriety for calling global warming a hoax, told reporters late on Friday that he and fellow Republicans on the environment and public works committee might refuse to participate.
Inhofe said Republicans would stay away from bill-writing sessions unless they got enough time to review more than 800 pages of proposals in detail. That stay-away would deny the committee a quorum.
"We're not being unreasonable," Inhofe said. "The only leverage we have is the quorum leverage, and if we get stonewalled, we'll use it."
Republican opposition to climate change legislation is not rock solid. Last week, a leading Republican senator, Lindsey Graham of South Carolina, wrote a column in the New York Times in support of legislation.
"Global climate change is not a religion to me but I do believe carbon pollution is harmful to the environment and I want to find a way to fix that problem," Graham said on Friday.
However, he did not go so far as to support the proposals currently before the Senate. "It's got to be good business. None of the bills in the House or the Senate right now are good business," Graham said. A number of conservative Democrats are also opposed to the proposed legislation.
Such divisions – and the unrelenting timetable – have discouraged even the biggest supporters of the climate change legislation. Last week, John Kerry, who helped write the bill, admitted for the first time it was unlikely to pass before Copenhagen.
However, Obama appeared to be just getting into the fight, indirectly accusing the business lobby that has spearheaded the fight against climate change of cynicism.
"There are those who will suggest that moving toward clean energy will destroy our economy – when it's the system we currently have that endangers our prosperity and prevents us from creating millions of new jobs," Obama said.
The US Chamber of Commerce has spent nearly $35 million in the past three months lobbying against the Obama administration's energy, healthcare and financial reforms.
The media barrage against climate change has shaken public faith in Obama's green energy agenda, said James Hoggan, a PR executive and author of Climate Cover-Up, a book about anti-environmental spin. "When you have so many people convinced that the legislation is a tax grab, and that cap and trade will increase the cost of energy in the gas tank and at home, that is a problem," he said. "Reframing this as an opportunity for green jobs is really hard – even for someone as skilled as Obama is."
Obama's claims of an emerging national consensus were undermined by a poll last week showing a sharp decline in the number of Americans convinced that there was solid scientific evidence of global warming.
Only 57% of Americans believe that the Earth's atmosphere is warming – a sharp fall from the 77% in 2007, said the poll of 1,500 people by the Pew Research Centre for the People and the Press.

Wind boss Graham Brown turns a tidy profit

Entrepreneur Graham Brown has invested about £200,000 in private equity deals through Hotbed, the private investor network, since 2005.
The 51-year-old, who lives near Banbury, Oxfordshire, has ploughed money into businesses including Sphere Medical, a technology company developing medical devices; Original Travel, a luxury adventure holiday firm; and Burcote Wind — where Brown is chairman — a renewable energy firm that will identify and secure planning permission for up to six onshore wind farm sites. He aims to achieve returns of up to 25% a year over five years.
“Money that’s been sitting on the sidelines is coming back,” said Brown.

Eddie Stobart goes green to bring in Spanish fruit and vegetables by rail

Environmental fears cause U-turn from haulage company accused of pollution
Robin McKie, science editor
The Observer, Sunday 25 October 2009
To environmentalists, Eddie Stobart is the embodiment of diesel-burning, fume-belching carbon emission, a major contributor to global warming. But the company – whose lorries criss-cross the continent – has launched a low-carbon rail freight trip across Europe.
The Stobart train is scheduled to leave Valencia on Tuesday on a two-day trip to the company's railhead in Dagenham, east London. It will carry 30 refrigerated containers crammed with tomatoes, lemons, oranges and other fruit and vegetables that will be brought, in an eco-friendly manner, to the larders and dining tables of Britain.
The expedition represents the longest single rail journey in Europe, says the company. It will also be the first time refrigerated rail containers will have passed through the Channel rail tunnel. Even better, it will prevent thousands of tonnes of carbon from being pumped into the atmosphere, said William Stobart, the company's chief executive.
"There has been a real change of attitude from the companies we deal with in recent months," Stobart told the Observer. "Suddenly they all want to know if they can have their goods carried in an environmentally sensitive way and, in particular, if they can have them moved by train."
As a result, the firm – once famed for its truckers and mighty, fume-emitting lorries – has turned to trains and, after protracted negotiations, has established the new rail service. A crucial element of these talks involved obtaining pledges from both the French and Spanish rail networks that the train – which will be carrying perishable goods – will not suffer major delays.
"We can't have it being shunted into a siding and then forgotten about," said Stobart. "Getting promises that this won't happen has been vital in setting up this operation."
The Stobart train left Dagenham last Friday carrying empty pallets and trays and is scheduled to arrive in Valencia this evening. The pallets and trays will be filled with fruit and vegetables, the containers sealed and the refrigerator units turned on before the train begins its journey back to Britain. Stobart said this single trip will take 30 lorries off the roads between southern Spain and England and bring about a massive reduction in carbon emissions because trains emit significantly less carbon dioxide per unit of cargo than lorries.
In a year, one weekly rail trip will stop 8,600 tonnes of carbon being pumped into the atmosphere, he said. However, Stobart's rail ambitions go beyond once-a-week journeys. The company plans to run new services on additional days of the week until it is operating five a week from Valencia to Dagenham by the end of next year. "It is just a matter of letting people find out what we are doing and building up the business," said Stobart. "We are quite sure the interest is out there. Consumers want to know what the environmental impact was of the food they are buying in their supermarkets. We can help that."
News of the Stobart launch was hailed by rail experts. "It has been a great disappointment that the Channel tunnel failed to open up a transcontinental rail freight network across Europe," said transport author Christian Wolmar.
"The charges were too high and the different national rail networks did not co-operate nearly enough to let trains pass over their tracks. So people kept on sending their produce by lorry. But now Eddie Stobart has cut through the bureaucracy and is getting something done. I would say that is well worth three cheers."

Who says it's green to burn woodchips?

Woodchip power stations are set for a boom. But conservationists are increasingly challenging their green credentials. Special report by Graham Mole
Sunday, 25 October 2009
One of the most cherished articles of faith of the green movement – that wood-fuelled power stations can help save the planet – is being increasingly challenged by campaigners and conservationists around the world.
Electricity generated by burning woodchips is on the verge of a global boom. America is planning 102 power stations fuelled by woodchips in the next few years. Europe is reported to be planning a similar, if yet unquantified, expansion. And in Britain, the next three years will see wood-fuelled power station capacity increase sevenfold, requiring, according to the campaign group Biofuelwatch, so much timber that it would need an area 12 times the size of Liechtenstein to grow it.
The power companies say the source will be "sustainable forests", but campaigners and ecologists claim that untold damage will be caused by the burgeoning market for wood. They say that, although traders in the developing world are being tempted to grub up and sell native forests, the chief danger is in the creation of monoculture plantations, where single species of trees are grown in straight rows and little wildlife can establish a home for itself.
They also challenge the "green" assumptions behind woodchip power, claiming that, far from fighting climate change, transporting large amounts of bulk wood across oceans and then burning it will increase carbon discharges by 50 per cent more than would have been caused by burning a fossil fuel like coal.
The power companies dispute the campaigners' science, and most also insist the wood will come from "sustainable sources", as approved and certified by the Forestry Stewardship Council. This non-government body said: "The FSC does not support the conversion of natural forests into plantations." But it added: "Certification may be granted if the forest manager... can demonstrate that they were not responsible for the conversion."
Such flexibility is now drawing fire. A recent article in The Ecologist, headlined "Can we trust the FSC?", read: "The World Rainforest Movement reports that by 2008 the FSC had certified 8.6 million hectares of industrial tree plantations 'despite ample evidence regarding the social and environmental unsustainability of large-scale monoculture tree plantations'... Jutta Kill, climate campaigner at the Forests and European Union Resource Network, says, 'There is a long continuum between an intact forest and short rotation monoculture tree plantation on the other end. It is preposterous to claim these are the same.'"
The FSC claims, however, that "properly managed plantations are essential to stop the destruction of natural forests".
The issue may yet prove just to be a panicky reaction to a radical expansion of wood energy, or it may be a portent of a deep problem. If so, it will echo the evolution of biofuels, initially embraced as a universal blessing before it was realised that native forests were being grubbed up to grow palm oil, and that US farmers would switch from food cereals to fuel cereals, thus causing a world food shortage.
Some campaigners are in no doubt. Almuth Ernsting from Biofuelwatch said: "It's almost unbelievable that we're creating vast areas of monoculture, mile after mile, just to be cut down as fast as they grow, to be shipped thousands of miles to be burned just for people's electricity. It just doesn't make sense. What about all the habitat that gets destroyed along the way?"
Simone Lovera, of the Global Forest Coalition in Paraguay, said: "Europe is going to cook the world's tropical forests to fight climate change; it's crazy." She said her group had obtained a report stating that Brazil is gearing up to meet the European woodchip demand, not by cutting down forests, but by expanding tree plantations by 27 million hectares, mostly of exotic species such as eucalyptus.
Last week, at the UN-sponsored World Forestry Congress in Buenos Aires, the agronomist engineer Hector Ginzo, an adviser to the Kyoto Protocol, stressed that plantations could not be classified as sustainable. He said UN rules "would never allow a plantation of eucalyptus or other fast-growing trees for use as pulp or wood to be considered a sustainable forestry project, because that kind of production favours monoculture forests and the carbon capture is lost when the trees are cut down".
The Global Forest Coalition said that, in South America, tree plantations have had devastating effects on people and the environment, and have nothing like the biodiversity or ecological function of natural forests, whether they are first or even second growth. These plantations, it said, are "green deserts" because of the amount of water they consume, and because of the lack of native wildlife.
Isaac Rojas, co-ordinator of the forest and biodiversity programme at Friends of the Earth International, said: "All over the world, plantations destroy the lands and livelihoods of local communities and indigenous peoples, as well as biodiversity and water resources. They also store less carbon than natural forests."
FoE International and the coalition now want the UN's Committee on Forestry to stop promoting plantations and to urge governments immediately to halt the conversion of forests into biofuel plantations. A UN report issued in March noted that the expansion of large-scale monocultures of oil palm, soy and other crops for agrofuel production has been a major factor in the failure to halt deforestation. It added: "The potential for large-scale commercial production of cellulosic biofuel will have unprecedented impacts on the forest sector."
Janet Larsen, director of research at the Earth Policy Institute, said: "Shipping chips like this is just not the answer. We have been warning about this for some time now. Wind turbines and solar power make much more sense. You need to source biomass from relatively small areas around power plants. Here in the US you can drive for an hour and never see more than one species of tree. We used to have far more natural forest than we have now."
She said the institute had now discovered land in Laos being bought by China to turn into plantations.
The Global Forest Coalition said an examination of international trading companies has revealed a new and growing global industry in wood for energy. UK campaigners at Biofuelwatch said that wood chips and pellets are now being imported from South America, the US, Canada, Portugal, South Africa and Russia, among others. It has also discovered that MagForest, a Canadian company operating in Congo, is starting to ship 500,000 tons of woodchips annually to Europe. The Independent on Sunday was offered 100,000 tons of tropical hardwood and softwood a month by a firm in Ghana, and a British firm is negotiating over supplies from Indonesia, home to some of the world's richest rainforests.
In Europe, small-scale woodchip power plants make use of locally harvested timber and wood waste. In the UK, a government strategy paper on waste said that recovering energy from the two million tonnes of the waste wood available could both generate electricity and save over a million tonnes of CO2 emissions. But such sources will not be able to feed the industry's huge need for wood in convenient bulk deliveries over the next few years. Worldwide, production of wood pellets is set to double in the next five years from the present 10 million tonnes to 20 million.
In recent months, British power companies have said they will build at least six new generation plants to produce 1,200 megawatts of energy, most by burning woodchips. The country's demand for wood will increase more than sevenfold. MGT Power, which is creating a new waste-to-energy plant at Ince in Cheshire and a new woodchip-fired power plant at Teesport near Middlesbrough, then another in North Shields, will be using chips from North and South America. It said it will use crops planted specifically for use as fuel, examples being eucalyptus, pine, willow and poplar. A company statement insisted that it "will never procure fuels that contribute to the loss of areas of protected habitat or areas of high ecological value".
One of the new plants – the world's largest – is now being built at Port Talbot in South Wales, and by 2012 it will supply over half Wales's one million homes, and, claim its owners, Prenergy, displace 3.5 million tons of CO2 emissions a year that would have been produced by older power stations.
The fuel will arrive by sea, largely but not exclusively from America. A company statement said: "Prenergy is committed to obtaining its feedstock from a range of overseas sources." This, it added, would "take advantage of a variety of species with rapid growth rates, and lower delivered moisture content due to rapid post-harvesting drying achievable in more southerly latitudes". The company said its studies had shown that the carbon emitted during shipping of the woodchip represents only about 2 per cent of the total carbon being transported. Other plants are planned for Drax, Anglesey and Teesside, which together will burn 20-30 million tons of wood a year.
Biofuelwatch said: "The land area needed to grow the biomass to power a station the size of Port Talbot ranges from 130,000 to half a million hectares of productive land – an area three times the size of Liechtenstein."
The power firms claim that generating electricity by burning wood emits an equal or lesser amount of CO2 than the quantity absorbed by the trees through photosynthesis in forests.
The claim, however, has been robustly denied by Rachel Smolker, a research scientist who works with the Global Justice Ecology Project in the US. She said: "Burning wood is called carbon-neutral, but it's not."
She says that research by the Massachusetts Environmental Energy Alliance, a US environmental group, indicates that burning trees for energy produces 1.5 times as much carbon as coal and three to four times more than natural gas. She added: "Climate change is a huge problem, but some of the plans for fighting it are even more dangerous."

Chip fat could be used to pave our roads

McDonald’s received plenty of headlines for powering its delivery fleet with chip fat; now it could be used to pave our roads. Aggregate Industries last week tested chip fat as an alternative to bitumen, the black stuff that helps asphalt bind together.
If it works it could cut millions of tonnes of carbon dioxide produced through the mining and use of bitumen. The idea won its inventor Helen Bailey, a PhD student at the University of East London, the Fiona and Nicholas Hawley Excellence in Environmental Engineering Award

Germans conquer the world by tilting at wind turbines

Michael Woodhead

As the workforce at the only wind-turbine factory in Britain was laid off at the end of April, Rene Umlauft, boss of the renewable-energy division of Siemens, the industrial giant, was enjoying a run of turbine sales. He had sold more than 120 in Britain, Turkey and at home in Germany.
The Vestas factory on the Isle of Wight was closed by its Danish owner — in the face of an occupation by some of its workforce — because of a lack of orders in Britain.
Yet Umlauft has managed to sign a €450m (£407m) deal for 88 wind turbines — part of the Sheringham Shoal offshore wind farm development off the Norfolk coast — and followed it with an announcement in May that Siemens was spending €60m on a production facility in Shanghai that would create 400 jobs. In June, Umlauft sealed a deal to build a solar park near Rome to supply electricity to 1,200 homes.
The Vestas saga is testament to Britain’s failure to gain even a toehold in the boom for the renewable-energy industry. It has been left to the Germans to dominate the world market and create at home an entire industry almost from scratch.
The passing of a renewable-energy law in 2000 galvanised the industry. As a result, Germany has cornered 18% of the renewable-energy market, leaving America in second place. Germany’s share is equal to the combined market share of Britain (with a meagre 4%), France and Italy.
The Germans are determined to defend this dominance in the face of growing competition from Asia, particularly China, and America. So much so that Karl Theodor zu Guttenberg, the German economics minister, has turned his back on the glories of the smoke-stack years.
“Nostalgia does not deserve a place in our industrial policies,” said Guttenberg.
He binned his ministry’s economic strategy paper and told his mandarins to stop living in the past.
Guttenberg is aware the Germans are in front partly by default. The British government ended years of dithering only with the publication of its Renewable Energy Strategy in July.
“As a nation we are guilty of coming up with the best ideas and then dropping the ball at the critical moment,” said Philip Wolfe, director of the Renewable Energy Association. “In the 1980s we were in a strong position but then carried on tinkering with the technology while the Danes and the Germans stimulated their home markets.”
Roland Berger, the business consultancy, reckons that in the next decade the German green energy industry will almost double in size and account for 14% of GDP, making it the country’s leading industrial sector.
Berger found that in the main areas of what it calls “environmental technology” the Germans have a significant hold. In heating and airconditioning they have 10% of the world market. In energy-efficient white goods they have 15% of the market. They have 90% of the biomass market.
Berger predicts this market will grow 5% annually and by 2020 will be worth €2.2 trillion worldwide. “Environmental technologies are ... expected to leave traditional industries in the dust, including the automotive and plant engineering sectors,” Berger said in a report for the German environment ministry.
Germany has moved from supplying 6.7% of its electricity from renewables in 2001 to 15% last year. The key has been the feed-in tariff that paid anyone who fed renewable energy into the grid four times the market rate and guaranteed income for 20 years.
From Bavarian farmers with plenty of barn space for solar panels to alternative life-style trendsetters in Hamburg, green energy became a money earner. Now Germany accounts for half the world’s installed solar panels.
Five years ago Siemens beefed up its renewable-energy division and bought a Danish manufacturer. Siemens is now the world leader in offshore wind turbines.
It generates a quarter of its earnings — €19 billion in 2008 — from green technology.
“We aim to increase that to €25 billion by 2011,” said Peter Löscher, Siemens chief executive. “The environment and climate protection are part of our growth story — financial crisis or no financial crisis.” Some 90% of all wind turbines in Britain come from Siemens.
In 2004 the industry employed an estimated 160,000 people. By 2008 that had grown to 278,000. Contrast that with Britain, which has a mere 25,000 in the industry.
The demand for domestic and small-scale green energy in Germany has been phenomenal. Vaillant, a heating and airconditioning company, last year earned 25% of its sales from renewables. “We do seven times the volume of business in green energy that we did in 2003,” said Ralf-Otto Limbach, the managing director. Sales of heat pumps rose 55% last year. Sales of solar panels rose 60%.
So confident is Vaillant of the renewable market that despite the recession it has embarked on a worldwide expansion. In Europe it has so far bought four service companies in France.
“The industrial base in Britain has shrunk dramatically in the past 20 years and that is a huge problem. What makes Germany successful is the high-end technical expertise to match market needs. Above all the market demands quality,” said Limbach.
“We would love to have a partnership with a company in Britain but there just isn’t one up to our standards.”
Charles Anglin of the British Wind Energy Association said: “Because of the planning system, and as a result of decisions made in the 1990s, manufacturing has gone to primarily Germany and Denmark.”
Ian Draisey, director of Dulas, named as company of the year in the 2009 British Renewable Energy Awards, said: “Fifteen years ago Britain had the opportunity to invest and didn’t. The Germans and the Danes did. Now I am afraid it will be scraps from the table for us.”

Business Fights Back

'One thing I can tell you: They can go out and chase me and chase the Chamber and put stuff in the newspaper. It only . . . drives more and more support. . . . You think we are going to blink because a couple of people are out shooting at us? Tell 'em to put their damn helmets on."
Them's fighting words, all the more so when delivered in the feisty, New York accent of U.S. Chamber of Commerce President Tom Donohue. The 71-year-old was recruited 12 years ago in order to revitalize a drifting business lobby. And the gregarious chief hasn't disappointed: He's grown the Chamber's membership, tripled its budget, transformed its lobby shop, and increasingly thrust it into the political fray. Most recently he's ginned up opposition to union "card check," the Environmental Protection Agency's (EPA) plans to regulate carbon emissions, and parts of the proposed financial overhaul.
The Obama administration's response has been to treat the Chamber like it has Fox News Channel: with brass knuckles. It has launched a campaign to undermine the organization by making CEOs think twice about associating with it. President Obama has openly criticized the Chamber, while adviser Valerie Jarrett has dismissed it as "old school" and acknowledged that the White House is bypassing it to work individually with CEOs.
When several major companies—including Exelon, Apple and Nike—ostentatiously quit the Chamber several weeks ago, provoking a flurry of unflattering headlines, it seemed no coincidence. Mr. Obama's allies in the unions, the trial bar and green lobbies have targeted the Chamber, some of its members, and Mr. Donohue personally.
For a man who prides himself on working both sides of the aisle, the Chamber these days is not a fun place for Mr. Donohue. Then again, he has an Irish temper and doesn't shrink from a brawl. At least for now, he's showing no signs of muting the Chamber's message.
"I did an interview a couple of week ago, and somebody said, 'Well, the White House says that you've become Dr. No and you are going to lose your seat at the table.' And I said, 'The White House doesn't give out the seats at the table. The seats at the table go to the people who have a rational policy, who have strong people to advance that policy, that have a strong grass-roots system, that have the assets to support their program, and that are willing to play in the political process," Mr. Donohue remarks, sitting in his office, which looks across Lafayette Park to the White House.
"The bottom line is you can't do this job if you are squeaky about all that stuff. My job is to represent the American business community in an honorable way, to present their interests in a way that I really think is good for them and good for this country. And," he adds with a pointed look, "I plan to keep doing it."
One irony of the Obama administration's demonization campaign is that Mr. Donohue is hardly a right-wing ideologue. There was a day, in the 1970s and 1980s, when the Chamber fought for limited government. But starting in the 1990s, the group became more interested in using Washington to forward a narrower corporate self-interest.
Mr. Donohue, who spent 13 years at the head of the American Trucking Association, also points out that the Chamber has done plenty to help the current administration. It supported last year's bailout funds ("we had to stabilize the banks"); the stimulus ("we could have gone into a real depression if there wasn't some confidence, some belief we could get over the next hump"); the auto bailouts ("this was a bellwether of the American company"), and even cash for clunkers.
The Chamber, Mr. Donohue says unapologetically, has "built a great deal of goodwill . . . by representing companies on the broad issues that we have defined, and working real hard to come to a common benefit where most people benefit more than 80%." He continues: "People have criticized us for helping industries or individual companies. What the hell do you think we do? That's our business!" If health-care and climate-change legislation do pass, Mr. Donohue argues, they will be "much, much, much better than they ever would have been if we had sat here on our hands."

What really seems to bother the White House is less Chamber ideology than its effectiveness. "They are going to have to go after somebody, right? Of course they are going after the individual ones, the bankers, and the insurers—and that's after they made deals with them. But who would you go after? Companies can't do this themselves . . . When it gets tougher, we get in."
Going after the Chamber is nonetheless a risk. The lobby works with a lot of Congressional Democrats from swing districts. Those pols face tough races next year, and Chamber support can help them raise money and protect against GOP attacks. The White House campaign gives GOP candidates an opening to point out how much Democrats dislike business.
The Obama team has already had one bruising experience with the Chamber's power over card check, Big Labor's priority of getting rid of secret ballots in union elections. The Chamber launched a full-scale campaign against the union-backed bill with the Orwellian name, the "Employee Free Choice Act."
Mr. Donohue is blunt, singling out the SEIU, the Teamsters and other unions: "What they are trying to do is change the rules." Why? "They want a hell of a lot more members, so they can have a hell of a lot more political influence, so they can change the way this country runs."
He takes some credit for the fact that swing-state Democrats have backed away from that vote. "The labor unions spent $240 million . . . and they figured, well, we got the Senate, and we got the House, and we got the presidency, let's go do this thing. What they forgot were 300 million Americans and all kinds of people in this town who represent them, and that a lot of members were elected in red states as Democrats and have got to go back and run again there. So we got into this deal, spent some money—by the way, good manners, high integrity, very aggressive—and it's stuck against the wall right now. Some people are walking around about a compromise. There ain't gonna be a compromise! There's not the votes for that thing."
The Chamber has also irked the White House with its ads against the Consumer Financial Protection Agency, taking on the proposed agency's powers to regulate any business that extends credit to consumers—including butchers and bakers. Mr. Obama denounced the Chamber by name and called the ads "false."
Mr. Donohue says he recently talked to Mr. Obama's economic adviser Larry Summers in Colorado, who was upset about the ads as well. "I looked at those ads, they weren't disingenuous. Maybe they picked out a few things here and highlighted them that weren't the most important things. But those things are gone out of the bill now. When you are in a debate you don't always like what the other guy says."
Where the fight has become especially rough is over climate change. While supporting cap-and-trade legislation, the Chamber opposes the EPA's "endangerment" finding, which would allow the agency to unilaterally regulatecarbon.
The Chamber thinks it bad precedent to allow the EPA to stretch the Clean Air Act to encompass carbon. "It would put them in charge of every major construction and rehab project, every road, every bridge, every port, every big building. I mean, you wanna put people out of work?" Mr. Donohue says. "They'd have to hire an army—which they'd probably unionize—to do the permits."
Last year, the Chamber asked the EPA to hold a hearing on "endangerment." The goal was not to debate overall climate science, but to force the EPA to demonstrate, as a matter of law, that carbon is dangerous. Then in September, the Chamber's senior vice president for environment, Bill Kovacs, made the mistake of suggesting the hearing might be like a "Scopes monkey trial" on the science.
"My first inclination was to cut his head off, but then I remembered that I run my mouth on a regular basis. So I said, we owe you a few, forget it, now shut up and don't say that again. Because we lost the focus on why we are doing this."
The comment gave several companies an excuse to bail. Does he worry others will leave? "Give me a break, will you? We have 300,000 members. We can legally represent three million people," he retorts. "Now, I've been here for 12 years, and we lose four members every week! And we sign up six."
He also notes that the idea that every member is always going to agree on every policy is ludicrous. "Bring 10 people to Thanksgiving dinner. Can you agree on anything? You try to take, let's just say for the hell of it, one thousand core members. Let's get them to agree on where to go to lunch, what day it is, how we should approach global warming or medical care. Holy (bleep)! So we have a system here and it works. And sometimes people aren't always happy, but most companies look at this and say 'Okay, I've got seven major issues. So I have a little disagreement on this one, but I'm getting along well on those.'"
He doesn't dwell on it, but Mr. Donohue has himself been a target, including by the National Resources Defense Council, which has accused him of a conflict of interest because of his seat on the board of directors of Union Pacific, a company that would be affected by climate-change legislation. He thinks "personal attacks" are out of order, vowing "I won't do it to them. We could. I won't."
The White House's war on the Chamber has come just as the group is launching a new $100 million campaign promoting free enterprise.
"We want to encourage and promote and educate and get a bunch of enthusiasm behind . . . the free enterprise system with free capital markets and free trade and the ability to fail and fall right on your ass and get up and do it again!" he says.
The belief in that system, Mr. Donohue says, has been eroded by the recession and subsequent criticism of the free market. "The purpose of this is to get out of the doldrums! Quit sulking and worrying." He hopes the campaign will remind Americans that "We created 20 million jobs in the '90s, we can do it again. We don't have to do it exactly like that—Adam Smith didn't have a BlackBerry—but we ought to pay attention to what made it work."

Some Democrats who have been demagoguing business view the campaign as a poke in the eye, and the White House's Ms. Jarrett has criticized it. "It's not an attack on anyone," he insists. "We're just asking Americans of every form, shape, size, weight and responsibility to take a look at it. If this . . . system works so well, why don't we think about how we could use it to our benefit now."
The Chamber is three years away from its 100th anniversary, and the "Dream Big" campaign is aimed in part at ensuring that birthday is worth celebrating. "The people that started this thing and came here and did it, they left a legacy that can be seen in the American economy and American achievement and I'm not going to screw it up."
He ends our meeting with a grin and cheerful warning: "This is a great place. If you walk on our lawn, we're going to turn on the sprinklers." —Ms. Strassel writes the Journal's Potomac Watch column.

Ravaged by drought, Madagascar feels the full effect of climate change

A 10% increase in temperature and a 10% decrease in rainfall sees Indian Ocean island struggle to feed its children
David Smith, Friday 23 October 2009 19.09 BST
Remanonjona Feroce founded the village of Anjamahavelo – meaning At the Lucky Baobab – in Madagascar a generation ago. With memories of a flood still fresh, he chose a spot far from the nearest river. He cleared the wild forest and sacrificed a sheep in the hope that it would make the owls, lemurs and snakes go away.
"Animals can't live together with little children and young girls," explained Feroce, an 85-year-old great-grandfather. "They don't want snakes to be here because they have bad spirits. They strangle children by curling around the neck. Owls are bad birds. If one hoots, it means somebody will die."
The animals did go away, but so did the luck of Anjamahavelo, a cluster of wooden houses. Southern Madagascar has had three years of crop failure in five years, resulting in chronic hunger for tens of thousands of families and soaring rates of malnutrition, stunted growth and death among children.
Three forces are combining with deadly effect on the Indian Ocean island, which is incalculably rich in wildlife but impoverished in basic infrastructure. Climate change is widely blamed for playing havoc with the seasons and destroying agricultural harvests. This is exacerbated by local deforestation, which has altered the microclimate and reduced rainfall.
Finally, a bloody political coup earlier this year paralysed essential services and led to the crippling suspension of several foreign aid programmes. The UN says that nearly half of households in the south have severe food shortages.
To feed her five children in Anjamahavelo, Tinalisy – her only name – works as a prostitute at the end of each month, when the local men, mostly in the police, have been paid. The unmarried 27-year-old has slept with men for sex since she was 17. "If the men don't want to marry, that is not really a problem. We have to survive."
Tinalisy says her 20-month-old daughter, Vany Lentine, suffers a fever each evening. "We eat once or twice a day – always cassava. I'm worried but what I can do? There is no money. People here are unhappy because their children do not eat. There is nothing to be happy about."
Other villagers say that the fierce competition for dwindling resources has led to lawlessness and violence. Valiotaky, 56, the village chief, supplies an explanation for the drought. "When we plant trees we don't have rain and nothing grows," he said. "I think God is angry. Young people don't respect the traditions."
Perversely, people in the south are so starved of water that they crave the increasingly fierce cyclones that pound the north three times a year. Two separate dry seasons have progressively expanded until they meet to form one long hot season, hitting crops such as maize, manioc and sweet potato.
Tovoheryzo Raobijaona, director of a food insecurity early warning system in nearby Ambovombe, said: "Before, people spoke about the cycle of drought every 10 years. Now it's every five years, or every three years. After a bad year like 2009, people need two to three years to get back to standard."
Unicef, the UN's children's agency, said that in the past six months 8,632 children had been treated for severe acute malnutrition in three southern regions – more than double the expected number. The UN's World Food Programme (WFP) warns that 150,000 children could be affected this year.
There are reports of people resorting to eating lemurs and turtles, even though these are culturally taboo. They have also resumed cutting down trees for firewood or to make space for rice fields, inadvertently adding to the drought problem by reducing the capacity of forests to capture water that will evaporate into clouds and become rain.
The added impact of global climate change is difficult to quantify. The World Bank says that only one thing is certain: in the past half century Madagascar has seen a 10% increase in temperature and 10% decrease in rainfall. Experts say it is not a question of whether this trend will continue, but by how much.
Silvia Caruso, deputy country director of the WFP, said: "Environmental degradation and climate change are building on each other. The results are dramatic in Madagascar."
This has been compounded by political instability. In March Andry Rajoelina, a city mayor, businessman and former DJ, seized power from president Marc Ravalomanana after clashes that left dozens dead. The fallout has been political deadlock, economic downturn, job losses, price inflation, collapsing public services, a flight of investors and international sanctions on a country that relies on foreign aid for half its budget.
Caruso added: "The coup has paralysed services that we need to work with in the provinces. It has made the response to drought more complex. We had to fill the gaps at regional level."
Bruno Maes, Unicef's representative for Madagascar, described the coup as "a disaster for children", adding: "Madagascar was on the road to take-off. They understood it was time to make reforms in health and education, so that all children can have access. Now all this is frozen. Nothing is moving."
Unicef has provided medicine and training to all regional health clinics for acute malnutrition cases, supported food distribution and worked to improve sanitation. The WFP has begun programmes to provide school meals to 215,000 children, help 8,000 households mitigate against environmental change and supply supplementary feeding to around 70,000 children under two and pregnant and lactating women.
Maes said Unicef was also negotiating with the World Bank to directly administer money earmarked for teachers' salaries. "Children's rights should be addressed in any situation – whatever the crisis."
Case-study: 'Lack of food is eating us up'
Zanasoa Relais Anjado, 38, has 11 children. Her husband, a former plantation worker, is unemployed. They live in Anjado village in southern Madagascar.
"Lack of food is eating us up every day. We often go through very hard moments – in the most difficult we ate only tamarinds [fruit] mixed with ashes. We were hungry and tired and had to beg for something to eat. We were like famine victims … I have 11 children and I don't know how to feed them. Sometimes we have one meal a day, sometimes two. One of my children was sick. He managed to survive and recover, but I know people in the community who are still very weak. The river is 5km from here and we walk for hours to get there … With rainwater we would cook food and diversify agriculture. We'd plant cabbages, green leaves, corn and beans. What we planted so far dried and failed … It will be really difficult and we will suffer. That is why I am asking the government for help, directly and immediately. Without it, we risk dying here. I don't care about the political situation in the country. The only thing that concerns me is that I'm eating."

Americans go cool on global warming

The number of Americans who believe there is solid evidence that the Earth is warming because of pollution is at its lowest point in three years, according to a survey.

Published: 7:00AM BST 23 Oct 2009
The poll of 1,500 adults by the Pew Research Center for the People & the Press found that only 57 per cent believe there is strong scientific evidence that the Earth has become warmer over the past few decades, and as a result, people are viewing the problem as less serious - down from 77 per cent in 2006.
The steepest drop occurred during the last year, as Congress and the Obama administration have taken steps to control heat-trapping emissions for the first time. The drop also was seen during a time of mounting scientific evidence of climate change – from melting ice caps to the world's oceans hitting the highest monthly recorded temperatures this summer.

The poll was released a day after 18 scientific organisations wrote Congress to reaffirm the consensus behind global warming.
"The priority that people give to pollution and environmental concerns and a whole host of other issues is down because of the economy and because of the focus on other things," said Andrew Kohut, the director of the research center, which conducted the poll from Sept. 30 to Oct. 4. "When the focus is on other things, people forget and see these issues as less grave."
Despite misgivings about the science, half the respondents still said they supported limits on greenhouse gases, even if it could lead to higher energy prices. But many of those supporters have heard little to nothing about cap-and-trade, the main mechanism for reducing greenhouse gases favored by the White House and central to legislation passed by the House and a bill the Senate will take up next week.