Tuesday, 8 July 2008

Go-ahead for more biofuels

David Adam and Alok Jha
The Guardian,
Tuesday July 8, 2008

Britain will continue to expand the use of biofuels in petrol and diesel for transport, despite an independent review that found that the fuels can drive up food prices and do little to combat global warming.
Ruth Kelly, the transport minister, said yesterday that Britain needed to press ahead with biofuels as the technology could still prove beneficial, but their introduction would be slowed down. "I believe it is right to adopt a more cautious approach until the evidence is clearer about the wider environmental and social effects of biofuels," she said.
The move follows the publication of a review of the environmental and social impact of biofuels by Ed Gallagher, head of the Renewable Fuels Agency. The report recommended that more effective controls needed to be in place to prevent an inadvertent rise in emissions if, for example, forests are cleared to make way for biofuels. Food prices can also rise as competition for land increases.
The report said that if left unchecked, current targets for biofuel production could cause a global rise in greenhouse gas emissions and an increase in poverty by 2020.

UK biofuel rethink draws criticism

By Fiona Harvey, Environment Correspondent
Published: July 7 2008 22:14

A government rethink over biofuels regulation, less than three months after its introduction, alienated both the fledgling biofuels industry and green campaigners on Monday.
In his long-awaited review of the sector, Ed Gallagher concluded that biofuels should not be abandoned but that the rate of adoption proposed by the government should slow.

Biofuels companies and farmers attacked ministers for changing their minds so soon; the renewable transport fuel obligation (RTFO), which mandates that 2.5 per cent of the UK’s transport fuels must come from biofuels this year, rising to 5 per cent by 2010, came into force in mid-April after three years of consultation. Green campaigners, however, castigated the review for not going far enough.
If Prof Gallagher’s proposals are accepted by the government – and the signs are that they will be – the 5 per cent target will not come into force until 2013-14, and it will be made dependent on the industry proving its green credentials.
His review also recommended that a separate target be set for “second generation” biofuels, made from waste products such as straw.
Graham Hilton, of the Environmental Industries Commission, a trade body, said changes to the RTFO would create uncertainty when long-term investment in the sector was needed.
The review found that biofuels would contribute about 15 per cent to rises in the cost of grain in Europe by 2020, compared with 2006 prices, if current biofuels targets were followed through. The US would suffer similar price rises, although developing countries would see a smaller increase and the price of other staple crops such as rice would be unaffected.
Only about 1 per cent of the world’s crop land is given over to biofuel production at present, and the review found it was probable there was enough agricultural land available in the world to grow food and fuels at least until 2020.
The review also found, however, that the price of vegetable oils and oilseed was vulnerable to competition from biofuels, and would rise by as much as 70 per cent in the US by 2020, compared with 2006 prices, if biofuels targets were met.
Additional reporting by Sanjay Odedra
Copyright The Financial Times Limited 2008

Turning down the fridges and switching off the lights

By Sarah Murray
Published: July 8 2008 00:43

When last year Tesco, the UK supermarket chain, measured the carbon footprint of its operations it correctly guessed that the lion’s share of its greenhouse gas emissions would come from the power it used in lighting its store and powering its fridges. However, it was surprised to find that refrigerant use represented 19 per cent of the total.
“We wouldn’t have come up with a number that big,” says Katherine Symonds, sustainability manager at Tesco. “And one molecule of HFC [hydro-fluorocarbon] is 3,000 times more potent than one molecule of C02 as a greenhouse gas. So that was a surprising hot spot.”
For Tesco, identifying such “hot spots” through the process of measuring its carbon footprint has been an essential part of its response to climate change and the growing pressure on the world’s natural resources.
“It’s allowed us to invest in the things that will really make an impact, such as natural refrigerants,” says Ms Symonds.
The company has set itself some ambitious goals. These include reducing the footprint of existing buildings by 50 per cent by 2020, making sure all new buildings generate, on average, 50 per cent fewer carbon dioxide emissions than a store built in 2006 and cutting emissions from the company’s fleet of vehicles by 50 per cent by 2012.
Tesco aims to cut the amount of packaging it uses by 25 per cent by 2010 – on branded products as well as Tesco own-brand – and to recycle 80 per cent of its store waste by 2009.
Renewable energy is also part of the picture for Tesco. The company has established a £1m ($2m) sustainable technology fund designed to invest in technologies that are not yet commercially viable.
Some of the investment is going into wind turbines, as well as combined heat and power systems and solar panels. The company already has a 500,000 square foot solar panel on the roof of its Californian distribution centre, for example.
“The payback period is longer than our normal business systems would allowed, so we’ve set aside this money,” explains Ms Symonds. “And we need suppliers in place to give us the technologies we’re going to need.”
With environmental systems, materials and technologies still emerging, experimentation is an important part of Tesco’s strategy. It is testing some of these in selected stores. In Shrewsbury and Wick, for example, it used a timber frame in the construction, instead of a steel one.
“We saw it had a really big impact on the embedded carbon of that store. And there are other benefits – it looks nicer and it’s more resilient in the case of fire,” says Ms Symonds. “So it’s unleashing a lot of creativity and lateral thinking.”
Perhaps most daringly, in 2007, the company announced that it would produce a carbon footprint label for all its products. The idea is that shoppers will eventually be able to compare products on their carbon emissions levels in the way they look at price or nutritional value.
Tesco has its work cut out. For calculating the carbon footprint of consumer products is an extraordinarily complex challenge, requiring examination of everything from raw materials to processing procedures, packaging and transportation.
It is hardly surprising, then, that for this particular goal, the company has set no deadline. Nevertheless, Tesco has already made some progress. About 20 products in its stores now have carbon footprint labels, including light bulbs, orange juice, potatoes and washing detergent. “The green message is sometimes confusing and conflicting – we want to make it as simple as possible, and carbon labelling is a great way of doing that,” says Ms Symonds.
The carbon-labelling project is part of the second main prong of Tesco’s sustainability strategy – helping its customers to reduce their environmental impact. “It’s all very well for us to change our light bulbs, but think of the impact if we get 30m weekly customers doing that,” says Ms Symonds. “If we can help them across a range of little decisions, then we’re really going to make a big difference overall.”
One example of this has been rewarding customers for green behaviour with Clubcard points. Encouraging the re-use of plastic bags in this way has helped save 1.6bn carrier bags since August 2006.
Tricky trade offs can emerge when pursuing environmental strategies, however. One that the food retail industry has encountered is the pressure to reduce “food miles”, cutting the distance that food has travelled. Yet the prospect of halting imports of horticultural produce from countries such as Kenya has prompted questions from development professionals and others, who point out that food exports have boosted the economies of such countries.
Tesco has responded to these questions. The company has set a target that less than 1 per cent of its produce will be air freighted, but when cuts need to be made, it says it will not make them from developing countries. “We’ve taken the view that global poverty is as big an issue as climate change,” says Ms Symonds. “And we have no intention of restricting trade with developing countries.”
Copyright The Financial Times Limited 2008

Green thrift

By Brian Groom
Published: July 8 2008 03:00

A silver lining may be hard to find in the economic downturn, but is there to be a green one? Conventional wisdom says concern about the environment vanishes when people cannot make ends meet. But the high fuel price is having more impact on personal behaviour than any exhortation to live a more "sustainable" life.
With a tank of petrol costing more than £50, there are fewer drivers on the roads and many are driving more slowly. Out-of-town shopping centres are worse hit than city-centre ones, with John Lewis reporting sales declines compared with last year of 24.6 per cent at Bluewater in Kent, 17.1 per cent at Brent Cross in north London and 16.4 per cent at Cribbs Causeway in Bristol.
There are other indicators of thrift-induced green behaviour. People may not like bin taxes but the middle class is embracing more sophisticated recycling. British users of Freecycle, a website that allows members to hand on unwanted products, have doubled to more than 1m in a year.
Investment in alternative energy is growing. Globally, a record £73bn at least is likely to be invested in clean technology this year, according to a report by consultants New Energy Finance for the United Nations.
So could this aid the revival of the cities - which use energy more efficiently - and help reverse migration to the countryside, suburbs and market towns? There will surely be an effect if the oil price stays high for long enough but changing a decades-long pattern of settlement and commuting will be painful.
The downturn brings problems for cities, too. Public and private funds for regeneration may dry up. The government's target of 3m new homes looks harder to achieve, whether on brownfield or greenfield sites. The high fuel price does, though, tend to vindicate planning policies that favour higher densities and urban development and discourage out-of-town shopping. And it leaves the government's plan for car-dependent "eco-towns" looking singularly ill-timed.
brian.groom@ft.com
Copyright The Financial Times Limited 2008

Food cost link causes retreat on biofuel

By Fiona Harvey, Environment Correspondent
Published: July 7 2008 21:38

The British government signalled a retreat on its biofuels targets on Monday after the publication of a report showing the fuels contributed to rises in food prices.
A review by Ed Gallagher, former chief of the Environment Agency, which could have international ramifications, recommended that the government put the brakes on its biofuels policy.

The current target is to derive 2.5 per cent of the UK’s transport fuels from biofuels this year, doubling by 2010. But Prof Gallagher said this should be slowed down, with the 2.5 per cent target left in place but raised by 0.5 percentage points a year to 2013-14.
Ruth Kelly, secretary of state for transport, signalled that the government would concede: “I agree with Professor Gallagher that we should take a precautionary approach over the next few years, until we are clearer about their wider effects.”
She stopped short of accepting the report’s recommendations on a revision to the biofuels targets, but announced to MPs a consultation on lowering the targets.
The Gallagher report found that, although there was “probably” enough land to satisfy food and fuel demands to 2020, biofuels did make a small contribution to food price rises.
Prof Gallagher also recommended that the European Union lower its proposed target of deriving 10 per cent of transport fuel from biofuels by 2020.
He will brief EU officials on his findings in the next week. The EU is still debating and approving the European Commission’s renewable energy proposals.
Biofuels industry leaders said they were “concerned” at the government’s apparent backsliding, pointing out that the target, in the form of a renewable transport fuel obligation, only came into force this year, after it was proposed in 2005.
Copyright The Financial Times Limited 2008

General Motors kicks off solar power initiative in Spain

By Richard Milne in Milan and Mark Mulligan in Madrid
Published: July 8 2008 03:00

General Motors is to build the world's largest rooftop solar power station at its largest European factory, and is considering similar projects for its other 19 plants across the continent.
The US carmaker will announce today that its Zaragoza factory in Spain, which produces about 500,000 cars a year, will be covered by 183,000 square metres of solar panels.
The investment is worth about €50m ($78.5m) and should provide the equivalent of about a quarter of the factory's power needs at peak times.
GM is working with France's Veolia Environnement and Clairvoyant Energy of the US on the 10MW project and some of the electricity generated will be sold back into the local power grid. GM is likely to make its Russian factory in St Petersburg the next to have such solar panels because of the long daylight hours and it will then evaluate whether to expand the scheme to its other 10 manufacturing and eight component factories across Europe.
The solar project comes amid huge difficulties for GM in the US market, where it is losing money and shedding jobs, meaning it is becoming more reliant on its profitable international activities in regions such as Asia, Russia and Latin America.
It also underlines GM's attempts to cast off its reputation as an environmental laggard after stopping the development of an electric car in the 1990s. It is now making the introduction of a new electric car, the Chevrolet Volt, its "number one priority" and Carl-Peter Foster, the head of GM Europe, will today say the Zaragoza project is part of GM's commitment to greater sustainability.
GM is also involved with Gazprom, the Russian energy group, in trying to set up an alternative infrastructure in Russia for low-emission cars.
In September, the Spanish government is set to ann-ounce its latest pricing regime for generation from renewable sources. Some say it could cut by as much as 30 per cent the current price support to large-scale solar generators, in a move to deter speculators.
However, the government is expected to maintain generous feed-in prices - currently worth about €0.45 per KW hour - for companies and individuals who generate electricity from solar panels on the outside of buildings.
In this way, it hopes to move electricity production from large, isolated solar parks to localised generation units. As the distance between generation source and end-users diminishes, so, too, does waste.
From 44MW of installed capacity at the end of 2005, Spain currently boasts about 800MW of photovoltaic generation, well above original government targets for this year.
Installation has already begun in Zaragoza of the 85,000 lightweight solar modules that are needed to cover more than half of the total roof area of the factory in panels.
The power station, which will be owned and operated by a joint venture comprising Veolia, Clairvoyant and the regional government of Aragon, will sell energy back to the grid equivalent to the need of 4,600 households.
That means the investment should deliver returns in eight to 10 years.
Copyright The Financial Times Limited 2008

Green practices beyond the marketing

By Ross Tieman - FT
Published: July 8 2008 03:00

The printing industry plays an enigmatic role in the sustainable business agenda.
Making paper requires trees to be felled, and uses lots of energy and chlorine, while printing, historically, requires toxic chemical compounds.
Yet many of the messages that have turned climate change into a leading global concern have been delivered on printed paper.
So the selection of Pureprint, an East Sussex printing company, as Small Company of the Year in the Impact on Society section of the awards is a sign of just how much vanguard companies in the industry are shouldering their responsibilities.
The irony is that the company's forerunner, the East Sussex Press, was a successful pre-green business, founded in 1926. But in 2004 it acquired Beacon Press at Uckfield and, moving its activities on to the site, swallowed Beacon's sustainability agenda lock, stock and barrel.
Renaming the enlarged group Pureprint, it set out to build a business model centred upon the green agenda. It was a smart move because, as studies have shown, 68 per cent of its customers say their decision to buy from Pureprint was influenced by the company's green credentials.
But this is no mere cynical marketing exercise. As Pureprint has rooted itself more deeply in a sustainable agenda, it has not only reaped benefits, but delivered a wider social impact that no-one could have envisaged.
The company has made savings of more that £100,000 a year from the more efficient and environmentally-friendly use of resources, and removed harmful products from its printing processes, resulting in an impeccable health and safety record.
Since 2005 - the year after the Beacon acquisition - the company has reduced by 30 per cent the amount of electricity and by 49 per cent the amount of carbon it produces per million pages printed.
But in last year's customer satisfaction survey, Pureprint also found that 79 per cent of its 160 employees were also satisfied with their jobs, and 43 per cent had been attracted to the company because of its responsible practices. These include investing in apprenticeships for 16 to 17 year-olds, and setting out consciously to be an equal-opportunities employer.
More than half of employees say they have changed their personal behaviour with regard to the environment because of what they have learned and, even more striking, 69 per cent of customers have also changed their views on environmental issues.
And what about all that paper, and all those felled trees?
The company has increased the amount of paper sourced from Forest Stewardship Council certified sustainable forestry and the use of recycled paper. These accounted for 87 per cent of the paper it purchased during the first quarter of 2008.
Its obsession with recycling even extends to the pallets on which supplies arrive at its works. These are turned into nesting boxes for birds, bugs and bats, and distributed to local schools, customers and its staff, building bridges with the wider community, and promoting local wildlife at the same time.
Printing may remain enigmatic, but it can clearly become sustainable.
Copyright The Financial Times Limited 2008

Climate change: let’s make a deal

Published: July 7 2008 19:54

President George W. Bush believes that climate change cannot be tackled effectively without the co-operation of China and India, and he is right. Yet the question of who must now take action on climate change has become hopelessly confused with the separate issue of who is responsible for previous emissions. In their discussions on Tuesday and Wednesday, the Group of Eight must cut through the confusion and reach agreement on a framework for a future deal on climate change.
China and India, both outside the G8, can rightly point out that G8 members have produced most of the carbon emissions now warming the planet’s atmosphere. The US, especially, has dragged its heels at every opportunity to make amends.
Yet fast-growing China is now the world’s largest carbon emitter. India, another stellar performer in terms of growth, is also a major polluter. What is more, countries least able to cope with climate change, such as the sub-Saharan African nations, fall into neither camp.
So far, political attempts to resolve this conundrum have been unforgivably muddled. But the basic problem is easy to state. The historical problem, the stock of carbon dioxide already in the atmosphere, is largely of the G8’s making. The solution has nothing to do with the existing stock and everything to do with stemming future flows of carbon dioxide into the atmosphere. That is the developing world’s problem as much as the developed world’s.
To put it another way, a fair solution will reflect the G8’s historical culpability, but an effective solution will require action from developing countries, especially India and China. That is partly because of their sheer scale, and partly because their capital stock is still growing rapidly, offering the prospect of “leapfrogging” to low-carbon technology.
The shape of a future deal ought to be fairly clear. Rich countries would acknowledge their historical role and offer substantial compensation, whether in cash or investments in new technology. In exchange, developing countries would agree to bear their fair share of future abatement costs, through full participation in a carbon tax or an auction of tradable permits. This is preferable to horse-trading over national targets, and to the troubled Clean Development Mechanism, the current system for engaging developing nations.
Yet merely to sketch such a deal is to realise the strength of leadership that will be required to reach agreement. Whatever their current problems at home, it is time for the G8 leaders in Japan to deliver.
Copyright The Financial Times Limited 2008

G8 wants broad UN deal to halve emissions - draft

Reuters, Tuesday July 8 2008
By Linda Sieg and William Schomberg

TOYAKO, Japan, July 8 (Reuters) - Group of Eight negotiators have reached a tentative agreement on climate change that will be put to their leaders on Tuesday, sources familiar with the talks said, potentially resolving the stickiest issue at their summit.
A statement that goes beyond last year's G8 summit pledge to "seriously consider" carbon emissions cuts of 50 percent by 2050 is especially important for Japanese Prime Minister Yasuo Fukuda, who has made climate change the centrepiece of the talks.
But efforts to clinch a deal have been hampered by deep differences within the G8. Details of the agreement, expected to be unveiled later on Tuesday, were not immediately available.
Senior officials from the Group of Eight rich nations met late into the night in Japan to thrash out wording that would allow President George W. Bush to put aside deep misgivings and sign on to a global goal of reducing greenhouse gas emissions by the middle of the century.
Bush is under strong pressure from Japan and Europe but says he will not back a numerical target unless big polluters including China and India agree to binding commitments to curb their carbon pollution.
The statement on climate change is also likely to highlight agreements to develop new technologies and provide funds to help poor countries limit greenhouse gas emissions. But activists were wary of prospects for real progress until a new U.S. president takes office next year.
"It's a little bit of a kabuki play," said Alden Meyer, director of strategy and policy for the Union of Concerned Scientists. "Everyone is just waiting for the next president to see how that changes things."
FOOD, FUEL, CLIMATE
Global warming ties into other big themes at the three-day meeting at a plush mountain-top hotel on the northern Japanese island of Hokkaido, where 21,000 police have been mobilised to protect the leaders.
U.N. Secretary-General Ban Ki-moon, who attended talks on Monday with African leaders, said the drive to reach eight Millennium Development Goals (MDGs) set by the U.N. General Assembly to reduce world poverty by 2015 was being directly hampered by global warming.
He urged the G8 to send a strong political signal by setting a long-term goal of halving greenhouse gas emissions by 2050, backed by intermediate targets that would set market forces in train to reduce energy consumption.
The G8 will set out its positions on climate change, aid to Africa, rising food prices and the global economy in a raft of statements due to be issued later on Tuesday.
Japan's Yomiuri newspaper said on Monday that the leaders' communique would highlight downside risks to the world economy and label rising food and oil prices a "serious threat".
The higher price of oil, which hit a record high of $145.85 a barrel last week, is taking a particularly heavy toll on the world's poor. A World Bank study issued last week said up to 105 million people could drop below the poverty line due to the leap in food prices, including 30 million in Africa.
"How we respond to this double jeopardy of soaring food and oil prices is a test of the global system's commitment to help the most vulnerable," World Bank President Robert Zoellick said.
"It is a test we cannot afford to fail," he told reporters.
To help cushion the blow, officials said the G8 would unveil a series of measures to help Africa, especially its farmers, and would affirm its commitment to double aid to give $50 billion extra in aid by 2010, with half to go to the world's poorest continent.
The summit wraps up on Wednesday with a Major Economies Meeting comprising the G8 and eight other big greenhouse gas-emitting countries, including India and China and Australia.

ADB plan to buy carbon credits after Kyoto cut-off

By Raphael Minder in Bangkok - FT
Published: July 8 2008 03:00

The Asian Development Bank is setting up a new climate change fund to invest in carbon credits that will be generated after 2012, the -cut-off date for the Kyoto protocol.
Most carbon trading funds do not invest in credits that will be issued after the protocol has expired, given the uncertainty about its successor. Negotiations are on-going but will not be completed until the end of next year.
The Asian lender is hoping the fund will have about $200m, enough to finance about 40 carbon reduction projects. It hopes the move will also encourage other public and private investors to invest in carbon credits that may come on stream after 2012.
"$200m is not a silver bullet to solve the climate change problem but we hope this model can be replicated by others, either development or commercial banks," said Toru Kubo, a clean energy and climate change expert at the ADB who has been involved in launching the fund.
Countries such as Norway as well asthe European Union and US states such as California have made commitments to reducing greenhouse gas emissions beyond 2012. However, this week's Group of Eight meeting in Japan is expected to underline divergences on what international targets could be agreed beyond that date.
On arriving in Japan, George W. Bush, the US president, reaffirmed that Washington could agree to goals only if they were shared by China and India, Asia's new economic powerhouses.
Oil's rise towards $150 a barrel is already forcing Asian and other oil importers to promote renewable energy investments more aggressively, in order to cut their ballooning fuel import and subsidy costs. Some of the largest industrial companies in South Korea, the world's fifth-largest oil importer, yesterday agreed to invest Won2,790bn ($2.7bn, €1.7bn, £1.4bn) through 2012 to develop energy-saving facilities. The promise is being backed by the government, which has pledged to boost tax benefits for such investments.
Mr Kubo predicted the new Asian fund would look to finance 10-30 per cent of the total cost of about 40 projects.
The World Bank and the European Investment Bank - in partnership with four European banks - have already announced the creation of post-2012 funds but the ADB said that, unlike their pay-on-delivery ap-proach, it had opted for upfront financing to help projects get off the ground.
While projects will be selected across the AsiaPacific region, including in larger countries such as China, Mr Kubo also suggested that it would mostly benefit smaller developing nations.
"Pay-on-delivery is now the prevailing modality of projects, so that is why large countries have benefited most from the carbon credit market, because they have enough credits to raise money from commercial banks," he said. "Countries like Laos or Vietnam may not have the money to begin the project in the first place, so an upfront payment can really help."
The ADB will be trustee of the fund but is in talks with other entities, public and private, to enlarge its scope.
Its existing clean-energy funding facility, based on carbon credits until 2012, has raised about $150m.
Copyright The Financial Times Limited 2008