Shenanigans on the high seas

There's an interesting article (it may require a login) in last week's Economist about the Polestar, a tramper that carries fish without using sea containers, that was detained by Moroccan armed forces at the request of several European governments. It was on a blacklist of ships known to be involved in illegal fishing. It had picked up a consignment of Pollock from one of the world's few certified sustainable fisheries, off the coast of Alaska, that was destined for Europe. The cargo has been allowed to proceed on a legal ship but the Polestar's fate is undecided.

The worry is that cargoes that come from Marine Stewardship Council certified fish stocks, which companies like WalMart and Unilever are increasingly committed to using (see the links for details of their schemes), can become contaminated with illegally fished cargoes. Until the entire supply chain can be validated as clean then the world's fish stocks will remain under threat. And as the above article pointed out, the business of international shipping is notoriously lawless.

Airbus A380 SuperJumbo bought as Private Jet

My jaw dropped when I read The Economist that a private buyer has placed an order at the Paris Air Show for an Airbus A380 super-jumbo. Airbus said the individual was "not from Europe or the US" and that the plane was for "personal use for him and his entourage". The cost is estimated at around $300m.

This follows on from Joseph Lau, the Hong Kong Real Estate tycoon, who became the seventh person to order a Boeing 787 VIP as a private jet.

Apart from the moral aspects of such outrageous flaunting of wealth, the unjustifiable squandering of the earth's limited resources mean that neither Boeing nor Airbus should even be selling large aircraft for this purpose. But as all taste and propriety seems to have disappeared in the stratosphere of the super-rich and the boardrooms of corporate behemoths, then a simpler approach needs to be taken.

My proposition is this, that non-commercial/private aircraft, over a certain (small) size, should be barred from landing at any public airport or airport whose flight path causes noise pollution over residential areas. And that should go double in the over-crowded skies in Europe and the US.

Google basks in sunlight...

As part of its commitment to solar energy production, Google's Mountain View Googleplex offices is having 9,212 solar panels installed - now 90% completed according to the Google Solar Panel Project website.

The website provides details and graphs on how much energy has been produced in the last 24 hours and the last week. You can also see pictures of the installation.

This part of the Climate Savers Computing Initiative which is seeking to reduce greenhouse gas emissions caused by computers by 54 million tons a year by 2010.

Plug-in hybrid cars

Check out this site about Plug-In hybrid cars.

Key points:

• battery electric vehicles emit at least 50% lower greenhouse gases than gasoline cars even including the power station emissions required to produce the electricity to power them
  
• higher reductions possible if using renewable energy sources
• runs at an equivalent cost of under $1 (50p) per gallon
• reduces urban air pollution and smog
• reduces reliance on foreign oil imports
• the technology is here today
  

EU greenhouse gas emissions drop

The European Environmental Agency's "Annual European Community greenhouse gas inventory 1990-2005 and inventory report 2007" reports that emissions of greenhouses gases (GHGs) dropped between 2004 and 2005, the latest years for which they have figures. The key findings are:

• EU-15: Emissions of GHGs decreased by 0.8 % between 2004 and 2005.
• EU-27: Emissions of GHGs decreased by 0.7 % between 2004 and 2005.
• EU-15: Emissions of GHGs decreased by 2 % compared to 1990.
• EU-27: Emissions of GHGs decreased by 7.9 % compared to 1990 levels.
• Germany, Finland and the Netherlands contributed most to the EU-15 reduction.

The EU-15 has a common target to reduce GHG emissions by 8% compared to their baseline (usually 1990 emissions). The laggards would seem to be Austria, Ireland, Italy, Portugal and Spain who are all way above their targets. The table below has the GHG emissions by country and their targets. Click it to open in a new window.

Wind farms in the sky

The Economist magazine, in its Technology Quarterly supplement, has an article about a company Sky WindPower, based in San Diego, that wants to build wind farms in the sky (about 6 miles up where the winds are very strong).

Check out the company site for more details but here is a thumbnail of their design, there's a larger picture on their website.



The only thing I'm not clear about is how they'll avoid it being blown away or the cable connecting it to earth snapping! Neat idea though.

EU fisharies policy

There's an interesting article by Charles Clover in today's Daily Telegraph about the latest EU fisharies policy. Charles Clover wrote an excellent, but depressing, book about the state of global fishing called "The End of the Line: How Overfishing is Changing the World and what We Eat" which I read a couple of years back and I keep an eye out for his articles.

Here what he says today:

- EU voted to allow fishing of endangered bluefin tuna in the Mediterranean and Eastern Atlantic at twice the quota level scientists say will lead to a collapse of stocks.

- Britain and Ireland voted against and were unhappy that Italy and France who are estimated to have overfished their quotas by 30% in the last two years were not forced to pay this back.

- French and Itailian fishermen are using illegal drift nets to catch tuna. Drift net fishing can lead to the death of dolphins and turtles.

- According to the WWF, the fisheries should be closed in June and the minimum landing size reduced to 30kg.

So after the razzamatazz of the Global warming spectacular last week at the G8, the EU is back to the dirty business of petty national advantage being considered more important than the long term survival and viability of our fisheries.

A couple of things worth reading...

This week's Economist (June 2nd - 8th) has an excellent special report on business and climate change. Meant to post this a few days back but definitely worth a read if you can still get hold of it. The Economist, long a sceptic of climate change, has definitely become converted to the cause and produces it usual high standard of analysis and reporting on what's going right, what's going wrong and what's on the horizon. I particularly enjoyed the article 'Irrational incandescence' which highlights that there are around 6 gigatonnes of CO2 pollution per annum which if abated would actually save us all money and improve economic growth. This ties in with a point made in the IPCC report that I blogged recently (here):

"Note that the bottom up analysis [of greenhouse gas mitigation] anticipates potential mitigation even at a zero carbon tax."

The second article is online at Yahoo Finance by Dr Charles Wheelan. It looks at plans in the US Congress to subsidise the liquidisation of coal to make fuel and the broader economic and environmental issues it raises. Judging by some of the responses to the article there are a lot of people who just don't understand the relationship between 'free' markets, state regulation and the purpose of subsidy and taxation in relation to things like pollution. This is a pity as it increasingly plays a role in all our lives.

As a brief aside, in the UK there are plans to increase airport capacity in the very crowded South East of England (the area around London). This, to me, raises a very simple question. How do you balance the economic gain accruing to the airport operator BAA and the airlines against the economic (reduction in house values) and environmental (air and noise pollution) losses faced by the residents affected?

OPEC's economic blackmail?

The oil producing countries, OPEC, are obviously starting to get nervous about their future prospects, as a mix of the green agenda and a desire for energy security take hold in the West. This story on the BBC caught my eye. The secretary general of OPEC has said that investment in biofuels could push oil prices "through the roof". His argument is that OPEC would reduce investment in new production and this would push prices up as there would be a squeeze on supply.

All in all, it's hard to think of a dafter argument from OPEC. If demand started to decrease for oil, then it is hard to imagine any sane country (and that is obviously a priviso that needs to be included with OPEC countries) holding back production to a future date when demand, and therefore price, is likely to be even less. Furthermore, a simple application of Porter's five forces analysis, which any business studies student would be familiar with, implies that the threat from substitution and the increased bargaining power of the customer (due to falling demand) would increase the rivalry within the oil production industry and the temptation for each member to pump as much as they could while the going was good. Despite OPEC's public face espousing quotas, the reality has always been that its members cheat as much as they can. One wonders whether OPEC could survive a shrinking oil market as it became every member for themselves.

For years, the Saudis have sought to keep oil prices at a level where they could milk the West for every penny they could get without pushing prices high enough for us to look elsewhere, particularly to renewables and nuclear, for our energy sources. It has been an interesting confluence of events, rising oil price due to Middle East instability and the rise of China, growing concerns in the US and Europe over energy security, rising trade imbalances and worries over global warming that have finally broken their hold. And frankly that's a good thing. And if oil prices were to go up if we move to biofuels, then that's good too. It would just speed up the process of getting away from a carbon economy and stop the backsliders.

Emissions accelerating faster than economy

The US National Academy of Sciences have just produced a report which finds that global greenhouse gas emissions have since 2000 been growing more quickly than the global economy. This is faster than the worst predictions of the Inter-governmental Panel on Climate Change (IPCC).

Here is the summary text with graph:

"Carbon dioxide released to the atmosphere is the main culprit in human-induced global warming. Typically, developed countries are identified as the main source of CO2 as a result of the burning of fossil fuels and other industrialized processes. An analysis by Michael Raupach et al. shows that developing countries are quickly catching up in CO2 emissions. The authors studied regional trends in emissions, energy use, and population and economic growth to determine patterns that affect CO2 emission and, ultimately, global warming. The analysis showed that, since 2000, CO2 emissions worldwide have increased more rapidly than predicted because emissions and energy use are growing faster than the gross domestic product (GDP) of many countries. No countries are decreasing their percentage of reliance on fossil carbon as an energy source. In addition, developing countries show significantly increased recent rates of growth in emissions. Developing economies, together forming 80% of the world's population, accounted for 73% of the global growth in emissions in 2004. However, these economies accounted for only 41% of emissions themselves and only 23% of emissions since the start of the Industrial Revolution around 1800."

George Bush and Climate Change

So, straight to the $64,000 question: is George Bush serious about addressing climate change or is he trying to derail European efforts to address it?

His previous record suggests great scepticism is due him. As the latest report from the IPCC has laid out in great detail, there are serious time constraints on us to achieve stabilisation of greenhouse gas (GHG) concentrations in the atmosphere. If we fail to achieve this then the likelihood of severe climate change impacts is increased.

This is from Chapter 3 of the latest IPCC report:

"Decisions to delay emission reductions seriously constrain opportunities to achieve low stabilisation targets (e.g. stabilising concentrations from 440 to 535 ppmv CO2-eq), and raise the risk of progressively more severe climate change impacts and key vulnerabilities occurring. For example, if the time when global emissions peak is postponed beyond the next 15 years category, constraining global temperature rise to below 2.6°C above the pre-industrial level (2.0°C above 1990), at equilibrium, would be out of reach using 'best estimate' assumptions of climate sensitivity. Once this temperature threshold is breached, climate impacts accrue significantly in the earth and human system."

As I pointed out in this blog on the latest IPCC report - "Delayed emissions reduction lead to investments that lock in more emissions-intensive infrastructure and this constrains the opportunities to achieve lower stabilisation levels and increases the risk of more severe climate change impacts." So, time is critical in addresing climate change and GHG emissions.

The European Union has agreed to a goal of preventing a temperature rise of more than 2C and to that end is promising to cut GHG emissions by 20% by 2020 (and by 50% by 2050). Some member states, including the UK are proposing to go further.

George Bush seems intent on refusing to commit to carbon reduction goals or timeframes. Instead he seems to be pinning his hope on technology to bail us out. But by ruling out carbon trading and refusing to accept a carbon tax this is unlikely to happen because for technology to be cost effective there needs to be a realistic carbon price (against which the technology can save money). This is at odds with the wishes of many of the states, including California, which want carbon trading systems and with much of US business which would like to operate under one set of rules.

So, the likelihood is that George Bush will seek to play for time, by insisting that China and India have to sign up for emissions cuts before the US will, and push the whole issue onto the next President in 2009.

Carbon Offset projects 2

As a follow up to yesterday’s post about agricultural methane capture, I found another similar project on a much larger scale. For the last year, I have used BP’s targetneutral scheme to offset my CO2 emissions from driving. I was taking a look through their current projects and discovered this livestock project in Mexico which seems very impressive.

I have to admit to being a bit of a sceptic when it comes to some offsetting schemes – I’m not sure whether they are really there to soothe your conscience and maybe make a few quid for someone who is less than scrupulous. What gives me confidence in both the companies that I have mentioned is that they have both gone to some lengths to prove their credentials. Targetneutral have Jonathon Porritt, former Director of Friends of the Earth, and a number of other eminent greens on their advisory board to help me overcome my general suspicion of oil companies. CarbonNeutral have their projects independently audited and seem to set themselves very high standards and their reputation seems good.

And just to be clear, I have no association with either of these companies beyond being a customer.

Carbon Offset projects

As I mentioned in a previous blog, I have invested in a number of carbon offset projects, including Carbon Neutral who I’ll look at today. Initially their projects were forestry schemes predominantly based in the UK but have since expanded to a number of tropical locations.

Forestry projects have come under increasing scrutiny as carbon offsets because their offset may not be as great as previously thought, usually take years to achieve and in mid to high latitudes, such as Northern Europe, can decrease the Earth’s albedo during the snow season, so increasing warming. In the Tropics, with faster growing trees and local economic benefits, there is a better case.

However, the part of Carbon Neutral’s offering I think is quite innovative is one of their methane reduction schemes. Methane is around 21-23 times more potent as a greenhouse gas than CO2, so the 670 tons of methane captured annually in their German agricultural methane capture scheme saves 14,100 tons of CO2-equivalent. What I particularly like about the scheme is that the captured methane is then used to make heat and electricity. It seems a well constructed and thought out scheme to me and one, I would think, that could be rolled out across many large farms saving a lot of greenhouse gas. The projected growth in the consumption of meat in the developing world with the ensuing increase in methane production means that projects like this need to become the norm in both developed and developing worlds.

Carbon Neutral also offer a guide on how to reduce CO2 emissions called Shades of Green - Some little and not so little decisions you can make today to help stop climate change.

IPCC’s latest report on Climate Change – summary part 7

In this final part, I’ll look at the role of government intervention and at sustainable development.

The case for government intervention

Government support through financial contributions, tax credits, standard setting and market creation is important for effective technology development, innovation and deployment.
- Public benefits of R&D investments are bigger than the benefits captured by the private sector, justifying government support of R&D.
- Government funding in real absolute terms for most energy research programmes has been flat or declining for nearly two decades and is now about half of the 1980 level.
- Governments have a crucial supportive role in providing an appropriate enabling environment to sustain investment flows and for effective technology transfer - without which it may be difficult to achieve emission reductions at a significant scale.


Even for an economic liberal like myself, there is a clear role for the state in setting the stage for tackling carbon emissions. I think it is clear that a carbon price needs to be set that reflects the damage caused by CO2 emissions. That way, it can be established what alternate energy sources, such as renewables and nuclear are viable. Also, it will cut out marginal economic activity that is only profitable when carbon emissions are ‘free’ to the polluter. Although I’m generally against tax breaks, in this case I think they are necessary to push the market to investing in speculative, energy efficient technologies, so that they can be brought to market quicker and make an impact on CO2 emissions sooner. As mentioned in the previous blog, the sooner the peak in emissions is reached and the decline starts, the sooner we will reach CO2 stabilisation and lower the rise in global temperatures will be.

Sustainable development

Making development more sustainable can make a major contribution to climate change mitigation whilst also providing other beneficial effects. For example:
- Climate change policies related to energy efficiency and renewable energy are often economically beneficial, improve energy security and reduce local pollutant emissions.
- Other energy supply mitigation options can be designed to also achieve sustainable development benefits such as avoided displacement of local populations, job creation, and health benefits.
- Reducing both loss of natural habitat and deforestation can have significant biodiversity, soil and water conservation benefits, and can be implemented in a socially and economically sustainable manner.
- Forestation and bioenergy plantations can lead to restoration of degraded land, manage water runoff, retain soil carbon and benefit rural economies.

One final point is the importance of the transfer of energy efficient technologies to developing countries. This will require the help of developed countries’ governments to overcome barriers to implementation, such as lack of skills and financing. A simple example of this would be transferring and implementing carbon sequestration technologies in developing countries that use a lot of coal fired power stations, such as China. The benefit in mitigation terms would be huge.

IPCC’s latest report on Climate Change – summary part 6

Mitigation in the long term (after 2030).

The report starts by making the fairly obvious point that to stabilise the levels of CO2 concentration in the atmosphere, emissions would need to peak and then decline and the lower the stabilisation level, the more quickly this peak and decline would need to occur. So, mitigation efforts over the next two to three decades will be very important. Delayed emissions reduction lead to investments that lock in more emissions-intensive infrastructure and this constrains the opportunities to achieve lower stabilisation levels and increases the risk of more severe climate change impacts.

I think this is a critical point and is why we have to involve developed and developing countries in the process now. We'll come to sustainable development in the next and final part!

Policies, measures and instruments to mitigate climate change

A wide variety of policy instruments are available to governments to create incentives for mitigation action:

- Integrating climate policies in broader development policies.
- Regulations and standards provide some certainty about emission levels.
- Taxes and charges or tradable permits will establish a carbon price.
- Financial incentives (subsidies and tax credits) can be used to stimulate the development and diffusion of new technologies.
- Information instruments (e.g. awareness campaigns) may positively affect environmental quality by promoting informed choices and possibly contributing to behavioural change.
- R&D can stimulate technological advances, reduce costs, and enable progress toward stabilization.

Policies that provide a real or implicit carbon price encourage businesses and consumers to invest in low-GHG alternatives and the report says this provides significant mitigation potential in all sectors. Modelling studies show that with a carbon price, by 2030, in the US$20-80 per tonne CO2-eq range could lead to stabilisation at around 550 ppm CO2-eq by the end of the Century. This equates to a global temperature rise, from pre-industrial levels, of around 3C.


My thoughts on this are that we are currently underestimating the cost of mitigating CO2 emissions. Some of the carbon offset plans charge at less than US$10 per tonne of CO2. This seems implausible to me and suggests that to gain customers some companies are seeking to offer the lowest price to assuage your guilt. I plan to look at carbon offset plans in more detail in the future.

I think what I like about the report in the mitigation area, is that it provides practical steps over the long term that could lead to stabilization levels that whilst bad could be recovered from. In addition, it also stresses the need to act now, and globally, to keep the stabilisation level as low as possible. Most people now accept that global warming exists, so governments need to act. In the last part of this series, I'll look at the role of government and sustainable development.

IPCC’s latest report on Climate Change – summary part 5

The report looks at sectors where mitigation of greenhouse gases (GHG) can occur and some examples.

Changes in lifestyle and behaviour patterns (all sectors)

- Changes in lifestyle such as BBC Newsnight's Ethical Man.
- Choices in energy use in buildings such as energy efficient bulbs.
- Improved public transport and reduced car usage.

New energy infrastructure in developing countries and upgrades in industrialised countries

- Investment over US$20 trillion between now and 2030. Long term impact on GHG emissions due to long life of energy plants.
- More effective to invest in end-use energy efficiency improvements than in supply.
- Renewables generally have a positive effect on energy security employment and air quality.
- Carbon sequestration.

To me this is the most interesting area in the whole energy debate and very pertinent given the decision by the UK government to go down the nuclear road again whilst China, and other developing countries, are building a vast coal fired energy infrastructure (we'd better hope that carbon sequestration is a goer!). Energy security in Western Europe is a huge issue with Russia an increasingly unreliable and menacing supplier. In my opinion pushing renewables is a no-brainer for developed countries and is an area that I have been investing in.

Transport sector - mitigation v growth

- Improved vehicle efficency. (Will only happen IMO if oil prices stay high).
- Biofuels to grow to 3% of market by 2030 possibly as high of 5-10% depending on oil price and level of carbon tax.
- Shift from road to public transport. (I just can't see this happening).
- Improvements in fuel efficiency and traffic management in aviation industry (versus high growth).

More energy efficiency options for new and existing buildings

- About 30% of GHG emissions could be avoided in this sector by 2030.

Industrial sector - energy intensive industries

- Upgrading old, inefficient facilities would significantly reduce emissions. Slow rate of capital stock turnover particularly in small and medium sized enterprises is a key barrier.

Agriculture - significant contribution at a low cost

- Soil carbon sequestration.
- Reductions in methane and nitrous oxide emissions in some agricultural systems.

Forestry - carbon sinks at low cost

- About 65% of the total mitigation potential is located in the tropics and about half could be achieved by reducing emissions from deforesting.

Household waste - small contributor but low cost mitigation

- Wide range of mature, effective technologies available.
- Waste minimisation and recycling mitigate through conservation of energy and materials.

Speculative - geo engineering projects

- Ocean fertilisation to remove CO2 from the atmosphere.
- Blocking the sun in the upper atmosphere. (Or pie in the sky?)

Unproven, costly and with the risk of unforseen side-effects.


The problem of global warming can seem overwhelming at times and the benefit of taking a sector by sector approach is that it becomes apparent that with the political will in all nations we can overcome this problem with a myriad of initiatives across the whole spectrum of human activities. I would recommend Elizabeth Kolbert's 'Field Notes from a Catastrophe' which looks at this in more detail.

Carbon trading expansion plan in UK

The Financial Times reports today that a white paper, which is to be published on Wednesday is "expected to commit the UK government to a world-leading emissions trading scheme going far beyond a European Union-wide system and plans by US states." The new scheme could affect up to 5,000 British organisations going beyond the usual big energy users. Ministers are looking at two options, one covering nearly 5,000 organisations consuming 3,000 megawatt hours or to have a higher threshold of 10,000 megawatt hours covering about 1,200 organisations. The scheme will probably be an auction-based cap and trade programme. The FT reports that hospitals, universities, government departments and local authorities could also be included in what ministers have decided should be a mandatory scheme.

The scheme is intended to cut annual carbon emissions by at least 1m tonnes by 2020.

My concern about this 'go it alone' plan is that it will further encourage British companies to look at relocating abroad and discourage inward investment, in effect exporting our pollution to less environmentally friendly countries. This is one area where I think international co-operation, standards and regulations are essential, otherwise companies will be able to arbitrage national regulations and evade their responsibilities.

IPCC’s latest report on Climate Change – summary part 4

Following on from yesterday’s blog going through the terms that the report is framed in, today I’ll look at the summary of the studies into greenhouse gas (GHG) mitigation. Both bottom-up and top-down studies indicate that there is substantial economic potential for GHG mitigation over the coming decades that could offset the expected growth in emissions.

A summary of these reports is presented in the following two tables that estimate the economic mitigation potential for a given level of carbon taxation by 2030. In the previous blog the term economic potential is defined. In the second blog in this series the scenarios A1B and B2 were presented with a graph of projected emissions in 2030 using the scenarios.

Estimates of economic mitigation potential by 2030, using bottom-up studies:


Note that the bottom up analysis anticipates potential mitigation even at a zero carbon tax.

Estimates of economic mitigation potential by 2030, using top-down studies:


The baseline emissions for 2000 were 43 Gigatonnes CO2-equivalent, so against scenario A1B we would need to see mitigation of 25GtCO2-eq/yr and 6GtCO2-eq/yr against scenario B2 to return to year 2000 emissions levels. To achieve this would require an expected carbon tax of $100 in scenario A1B but could potentially be achieved at zero cost in scenario B2. That's assuming that the baseline of year 2000 emissions doesn't lead to climate change.

The report looks at various sectors of the economy and looks at existing and future commercial technologies that could mitigate GHG emissions. Click the table to open in a new window.



And from these the report comes up with the following sectoral estimates of economic potential for global mitigation by 2030.



This table shows that the building sector has the largest economic potential for mitigation of GHG emissions. However, the sectors studied used different baselines!!! So, what I would take from this is that carbon taxation isn't necessarily a very effective way of reducing emissions in most sectors.

What will this cost?

According to the report, reaching GHG emissions consistent with stabilising concentrations of GHG in the atmosphere to between 445 and 710 ppm (parts per million) CO2-eq will cost the global economy up to 3% of world GDP. It further notes that regional costs may vary significantly from global averages (but doesn't provide any data on the differences).



My thoughts:

The level of GHG in the atmosphere in 2005, was 427 ppm CO2-eq against pre-industrial levels of 278 ppm CO2-eq according to the European Environmental Agency website. I think it is a good debating point as to whether 710 ppm CO2-eq constitutes a responsible target for stabilising emissions.

IPCC’s latest report on Climate Change – summary part 3

Mitigation of Greenhouse gas (GHG) in the short and medium term.

The report introduces a number of concepts which I will copy verbatim from the report and add some explanatory notes.

• The concept of “mitigation potential” has been developed to assess the scale of GHG reductions that could be made, relative to emission baselines, for a given level of carbon price (expressed in cost per unit of carbon dioxide equivalent emissions avoided or reduced).

The carbon price referred to is often called a ‘carbon tax’. So, the report is saying that for different rates of carbon tax there will be an associated reduction (or mitigation) of GHG emissions against a no carbon tax situation.

• Mitigation potential is further differentiated in terms of “market potential” and “economic potential”.

• Market potential is the mitigation potential based on private costs and private discount rates, which might be expected to occur under forecast market conditions, including policies and measures currently in place, noting that barriers limit actual uptake.

This, I think, is saying that companies could be expected to undertake emission reduction if a carbon tax was in place, because projects which were previously uneconomic, for the business, would become so. In other words, companies would eliminate GHG emissions when it was cheaper to do so than pay the carbon tax.

• Economic potential is the mitigation potential, which takes into account social costs and benefits and social discount rates, assuming that market efficiency is improved by policies and measures and barriers are removed.

Economic potential looks at the broader costs and savings arising from GHG emissions and their mitigation. For example, the costs of respiratory disease from air pollution. A clean air act, from a narrow perspective might seem to just impose costs on companies to clean up their act. A broader view considers the lost productivity due to worker illness and the health costs picked up by individuals, companies and the state. An even broader view would consider quality of life and attempt to put an economic value on clean air.

As the study notes, the broader perspective of the economic potential is generally greater than the market potential.

To estimate the potential, two broad classes of approach are used:

• Bottom-up studies are based on assessment of mitigation options, emphasizing specific technologies and regulations. They are typically sectoral studies taking the macro-economy as unchanged. Sector estimates have been aggregated … to provide an estimate of global mitigation potential for this assessment.

Bottom-up looks at individual sectors, such as the power industry or transport, and the affect that technology change or regulation could have in reducing emissions. These are then aggregated to produce global estimates.

• Top-down studies assess the economy-wide potential of mitigation options. They use globally consistent frameworks and aggregated information about mitigation options and capture macroeconomic and market feedbacks.

Over time, these models have become more similar as bits from each approach have been incorporated in the other and the results they produce are quite similar as we’ll see in the next blog.

The report identifies a particular advantage of bottom-up studies which is for the assessment of specific policy options at the sectoral level while top-down studies are useful for assessing cross-sectoral and economy-wide climate change policies, such as carbon taxes and stabilization policies.

One final caution:

• However, current bottom-up and top-down studies of economic potential have limitations in considering life-style choices, and in including all externalities such as local air pollution. They have limited representation of some regions, countries, sectors, gases, and barriers. The projected mitigation costs do not take into account potential benefits of avoided climate change.

I will look at some of the sectoral analysis in the next blog. I have to admit that this taking longer than I expected but I think it is important that the terms in which the report is framed are aired and explained.

IPCC’s latest report on Climate Change – summary part 2

After looking at historical emissions trends, the report then looks at future greenhouse gas (GHG) emissions trends and considers a series of scenarios around economic growth, global population growth, development of new technologies and their uptake. These were developed separately by the Special Report on Emission Scenarios.

The scenarios are:

A1. There is rapid economic growth with global population growth which peaks mid-century declining thereafter. The theme of this scenario is that the regions of the world converge, economically, scoially and culturally, and there is a substantial reduction in regional differences in per capita income.

This splits into 3 groups that describe alternative technological change to energy systems:

A1F1. Fossil fuel intensive.
A1T. Non-fossil energy sources prevalent.
A1B. A balance across a range of energy technologies.

A2. This scenario considers a very heterogeneous world with an emphasis on self-reliance and preservation of local identities. A slow convergence of fertility patterns leads to continuing population growth and technological change is more fragmented and slower than in other scenarios.

B1. Similar to A1 but with rapid changes to economic structures towards a service and information economy, with less material intensity and the introduction of clean and resource efficient technologies. The emphasis is on global solutions to sustainability, including improved equity, but without additional climate initiatives.

B2. Like A2, this scenario describes a world with local solutions to sustainability. It has continuously increasing population growth, at a lower rate than A2, intermediate levels of economic development, and less rapid and more diverse technological changes than the A1 and B1 scenarios.

Estimates of GHG emissions for the years 2030 and 2100 were developed from these scenarios, and have since been updated. Both are included in the graph (and make it a bit confusing!). The year 2000, on the left of the graph, is taken as the baseline.

You can click on the graph to open it in a new window.




The general consensus in the report is that with current climate change mitigation policies and related sustainable development practices, GHG emissions will continue to grow over the next few decades.

As can be seen from the above graph, these scenarios lead to a wide range of projected emissions. These range from an increase of 9.7 Gigatonnes (CO2 equivalent) from the year 2000 baseline by 2030 to 26.7 Gigatonnes (CO2 equivalent) by 2030 - respective a 25% and 90% increase.

By the year 2100, there is a huge variation in GHG emissions between scenarios due to different ways of mitigating them. In the next blog, I'll look at what the report says about mitigating GHG emissions, the sectors where this can be achieved and the costs.

IPCC latest report – summary part 1

The IPCC’s latest report on climate change is out soon and the summary is available here. The summary looks at:

- Greenhouse gas (GHG) emission trends

- Mitigation in the short and medium term across different economic sectors (until 2030)

- Mitigation in the long term (beyond 2030)

- Policies, measures and instruments to mitigate climate change

- Sustainable development and climate change mitigation

- Gaps in knowledge

If you don’t fancy ploughing through the report and it’s plethora of data and charts, I’ll pull out some highlights over a few blogs. In this one I’ll look at historical trends.

Greenhouse Gas emission trends

The report starts by looking at greenhouse gas (GHG) emission trends. It notes that between 1970 and 2004 emissions of the main GHGs - CO2, CH4, N2o, HFCs, PFCs and SF6 – have increased by 70% (24% between 1990 and 2004).

The largest growth areas between 1970 and 2004 are the energy supply sector (up 145%) and transport (up 120%). Other areas of note are industry (up 65%), land use, land use change and forestry (up 40%) and agriculture (up 27%).

In 2004, Developed countries produced 57% of world GHG emissions versus 20% of world population.

The long term trend of declining carbon intensity of energy supply reversed after 2000. This means that more carbon is being produced per Watt of energy – and we’re producing a lot more Watts of energy!

A range of policies, including those on climate change, energy security, and sustainable development, have been effective in reducing GHG emissions in different sectors and many countries. The scale of such measures, however, has not yet been large enough to counteract the global growth in emissions.

Below is a summary graph of total GHG emissions in Gigatonnes CO2 equivalent from 1970 to 2004.

You can click on the graph to open it in a new window.

Charities' statement on Biofuels

RSPB, WWF, Greenpeace, Oxfam and Friends of the Earth joint statement on biofuels

The group's full statement is:

The current political and business enthusiasm for renewable biofuels is understandable. This emerging industry could play an important role in tackling climate change. However, without appropriate safeguards, this flagship policy could have disastrous unintended consequences - actually increasing carbon emissions, intensifying deforestation and causing extensive negative social impacts.

We are concerned that Government's plans to promote biofuels through the Renewable Transport Fuel Obligation (RTFO), lack these precautions.

Greenhouse gas emissions savings from different biofuels vary widely and some can even result in an overall increase. The RTFO as proposed fails to distinguish between the biofuels that can contribute most to tackling climate change.

In addition, without strong, mandatory standards in place the RTFO will attract biofuels produced at the expense of forests, peat lands and natural grasslands in places such as Brazil and Indonesia. As well as being hugely important habitats, their destruction will add huge volumes of carbon dioxide into the atmosphere. Making biodiesel from soy planted on cleared rainforest takes 200 years before it could be considered carbon neutral.

The expansion of tropical crops such as palm oil is also linked to the loss of indigenous peoples land rights, human rights abuse and the destruction of local communities' natural resources.

To gain our support, the RTFO must:

• Ensure that biofuels meet strict externally audited, widely accepted and mandatory sustainability and greenhouse gas balance standards, including at least a 50% saving on greenhouse gases compared to fossil fuels, taking a whole life-cycle approach.
• Take account of the greenhouse gases caused by land-use change and forest clearance to grow biofuels so that where high carbon land-uses are lost, no saving is claimed.

Although additional measures may become necessary, with these safeguards in place, biofuels are much more likely to contribute to a reduction in emissions from the transport sector without damaging the environment.

The power of turning things off

The latest edition of Red Herring (30th April 2007) reports that Comverge, an electrical grid management company, has raised $95.4m in the first public offering of its type. It's energy-monitoring technology is designed to assist utilities and consumers in utilizing energy smarter and more efficiently. The energy they save they call 'negawatts' and they consider it as important as wattage produced during periods when demand outstrips energy supply. Comverge CEO Robert Chiste told Red Herring that he thinks that this sector, previously seen as unsexy, is now coming to life.

I recently heard, unfortunately I can't remember where, that about 10% of all energy used in the home is for appliances on standby. The story goes that the clock on the microwave will consume more power in its lifetime than will be used in actually heating things. It strikes me that legislation needs to be put in place to force manufacturers to design their products to avoid this waste. I would prefer a market solution but I don't think that consumers are well informed enough to force the change. For example, I only found out that my TV used a lot of power whilst in standby when the coils burnt out and I had to pay for new coils - the repairman set me straight on turning things off!

Whilst this isn't going to save the world on its own, I think it's a really good example of a change of behaviour that not only helps the planet but also saves us all money. And I think that the world is only going to be saved by the aggregation of a lot of these energy saving culture changes working in tandem with new technologies.