NewEnergyNews: EMISSIONS TRADING: THE GOOD, THE BAD AND THE CHINESE

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge: To make every day Earth Day.

YESTERDAY

  • Weekend Video: John Oliver On Visiting Antarctica
  • Weekend Video: Warmest May And June Ever And Non-Stop Record Heat
  • Weekend Video: Meet The Microgrid
  • THE DAY BEFORE

  • FRIDAY WORLD HEADLINE- STAR WARS PLANET TATOOINE’S CLIMATE CHANGE
  • FRIDAY WORLD HEADLINE-BIG NEW THREAT TO CLIMATE FROM COAL-TO-GAS IN CHINA
  • FRIDAY WORLD HEADLINE-INDIA VILLAGE OF 2,400 GOES 100% SOLAR WITH BATTERIES, MICROGRID
  • FRIDAY WORLD HEADLINE-GERMANY IS WORLD’S MOST EFFICIENT MAJOR ECONOMY
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    GET THE DAILY HEADLINES EMAIL: CLICK HERE TO SUBMIT YOUR EMAIL ADDRESS OR SEND YOUR EMAIL ADDRESS TO: herman@NewEnergyNews.net

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    THE DAY BEFORE THE DAY BEFORE

    THINGS-TO-THINK-ABOUT THURSDAY, July 24:

  • TTTA Thursday-CLIMATE FACTS VERSUS CLIMATE CULTURE
  • TTTA Thursday-MONEY IN WIND UP FOR QUARTER, DOWN FROM 2013
  • TTTA Thursday-MIDWEST BIOFUELS CAN BE NEW ENERGY – UCS STUDY
  • TTTA Thursday-TESLA CHAMPIONS THE PLUG AND THE CAR
  • THE DAY BEFORE THAT

  • THE STUDY: EUROPE’S OFFSHORE WIND PROGRESS THIS YEAR
  • QUICK NEWS, July 23: NEW ENERGY WAS 55% OF 1H 2014 U.S. NEW BUILD; EV SALES LEAP; OCEAN ENERGY’S FINANCES UNDER SCRUTINY
  • AND THE DAY BEFORE THAT

  • THE STUDY: WHY THE OIL & GAS INDUSTRY BACKS AN ALL-OF-THE-ABOVE ENERGY POLICY
  • QUICK NEWS, July 22: U.S. DOE FORESEES NEW ENERGY; THE BEST CITIES FOR NEW ENERGY; ENERGY STORAGE TO BE $50BIL MRKT
  • THE LAST DAY UP HERE

  • THE STUDY: THE COST OF ADDING SOLAR TO A UTILITY’S OPERATIONS
  • QUICK NEWS, 7-21: U.S. WIND, SOLAR TO GROW THROUGH 2020; NEW GEOTHERMAL RISING; CHINESE HAVE RIGHTS IN OREGON WIND BUY
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    Anne B. Butterfield of Daily Camera and Huffington Post, is a biweekly contributor to NewEnergyNews

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT)

    November 26, 2013 (Huffington Post via NewEnergyNews)

    Everywhere we turn, environmental news is filled with horrid developments and glimpses of irreversible tipping points.

    Just a handful of examples are breathtaking: Scientists have dared to pinpoint the years at which locations around the world may reach runaway heat, and in the northern hemisphere it's well in sight for our children: 2047. Survivors of Superstorm Sandy are packing up as costs of repair and insurance go out of reach, one threat that climate science has long predicted. Or we could simply talk about the plight of bees and the potential impact on food supplies. Surprising no one who explores the Pacific Ocean, sailor Ivan MacFadyen described long a journey dubbed The Ocean is Broken, in which he saw vast expanses of trash and almost no wildlife save for a whale struggling a with giant tumor on its head, evoking the tons of radioactive water coming daily from Fukushima's lamed nuclear power center. Rampaging fishing methods and ocean acidification are now reported as causing the overpopulation of jellyfish that have jammed the intakes of nuclear plants around the world. Yet the shutting down of nuclear plants is a trifling setback compared with the doom that can result in coming days at Fukushima in the delicate job to extract bent and spent fuel rods from a ruined storage tank, a project dubbed "radioactive pick up sticks."

    With all these horrors to ponder you wouldn't expect to hear that you should also worry about the United States running out of coal. But you would be wrong, says Leslie Glustrom, founder and research director for Clean Energy Action. Her contention is that we've passed the peak in our nation's legendary supply of coal that powers over one-third of our grid capacity. This grim news is faithfully spelled out in three reports, with the complete story told in Warning: Faulty Reporting of US Coal Reserves (pdf). (Disclosure: I serve on CEA's board and have known the author for years.)

    Glustrom's research presents a sea change in how we should understand our energy challenges, or experience grim consequences. It's not only about toxic and heat-trapping emissions anymore; it's also about having enough energy generation to run big cities and regions that now rely on coal. Glustrom worries openly about how commerce will go on in many regions in 2025 if they don't plan their energy futures right.

    2013-11-05-FigureES4_FULL.jpgclick to enlarge

    Scrutinizing data for prices on delivered coal nationwide, Glustrom's new report establishes that coal's price has risen nearly 8 percent annually for eight years, roughly doubling, due mostly to thinner, deeper coal seams plus costlier diesel transport expenses. Higher coal prices in a time of "cheap" natural gas and affordable renewables means coal companies are lamed by low or no profits, as they hold debt levels that dwarf their market value and carry very high interest rates.

    2013-11-05-Table_ES2_FULL.jpgclick to enlarge

    2013-11-05-Figure_ES2_FULL.jpg

    One leading coal company, Patriot, filed for bankruptcy last year; many others are also struggling under bankruptcy watch and not eager to upgrade equipment for the tougher mining ahead. Add to this the bizarre event this fall of a coal lease failing to sell in Wyoming's Powder River Basin, the "Fort Knox" of the nation's coal supply, with some pundits agreeing this portends a tightening of the nation's coal supply, not to mention the array of researchers cited in the report. Indeed, at the mid point of 2013, only 488 millions tons of coal were produced in the U.S.; unless a major catch up happens by year-end, 2013 may be as low in production as 1993.

    Coal may exist in large quantities geologically, but economically, it's getting out of reach, as confirmed by US Geological Survey in studies indicating that less than 20 percent of US coal formations are economically recoverable, as explored in the CEA report. To Glustrom, that number plus others translate to 10 to 20 years more of burning coal in the US. It takes capital, accessible coal with good heat content and favorable market conditions to assure that mining companies will stay in business. She has observed a classic disconnect between camps of professionals in which geologists tend to assume money is "infinite" and financial analysts tend to assume that available coal is "infinite." Both biases are faulty and together they court disaster, and "it is only by combining thoughtful estimates of available coal and available money that our country can come to a realistic estimate of the amount of US coal that can be mined at a profit." This brings us back to her main and rather simple point: "If the companies cannot make a profit by mining coal they won't be mining for long."

    No one is more emphatic than Glustrom herself that she cannot predict the future, but she presents trend lines that are robust and confirmed assertively by the editorial board at West Virginia Gazette:

    Although Clean Energy Action is a "green" nonprofit opposed to fossil fuels, this study contains many hard economic facts. As we've said before, West Virginia's leaders should lower their protests about pollution controls, and instead launch intelligent planning for the profound shift that is occurring in the Mountain State's economy.

    The report "Warning, Faulty Reporting of US Coal Reserves" and its companion reports belong in the hands of energy and climate policy makers, investors, bankers, and rate payer watchdog groups, so that states can plan for, rather than react to, a future with sea change risk factors.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    It bears mentioning that even China is enacting a "peak coal" mentality, with Shanghai declaring that it will completely ban coal burning in 2017 with intent to close down hundreds of coal burning boilers and industrial furnaces, or shifting them to clean energy by 2015. And Citi Research, in "The Unimaginable: Peak Coal in China," took a look at all forms of energy production in China and figured that demand for coal will flatten or peak by 2020 and those "coal exporting countries that have been counting on strong future coal demand could be most at risk." Include US coal producers in that group of exporters.

    Our world is undergoing many sorts of change and upheaval. We in the industrialized world have spent about a century dismissing ocean trash, overfishing, pesticides, nuclear hazard, and oil and coal burning with a shrug of, "Hey it's fine, nature can manage it." Now we're surrounded by impacts of industrial-grade consumption, including depletion of critical resources and tipping points of many kinds. It is not enough to think of only ourselves and plan for strictly our own survival or convenience. The threat to animals everywhere, indeed to whole systems of the living, is the grief-filled backdrop of our times. It's "all hands on deck" at this point of human voyaging, and in our nation's capital, we certainly don't have that. Towns, states and regions need to plan fiercely and follow through. And a fine example is Boulder Colorado's recent victory to keep on track for clean energy by separating from its electric utility that makes 59 percent of its power from coal.

    Clean Energy Action is disseminating "Warning: Faulty Reporting of US Coal Reserves" for free to all manner of relevant professionals who should be concerned about long range trends which now include the supply risks of coal, and is supporting that outreach through a fundraising campaign.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    Author's note: Want to support my work? Please "fan" me at Huffpost Denver, here (http://www.huffingtonpost.com/anne-butterfield). Thanks.

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    Anne's previous NewEnergyNews columns:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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    Your intrepid reporter

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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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  • Friday, May 09, 2008

    EMISSIONS TRADING: THE GOOD, THE BAD AND THE CHINESE

    Originally posted May 4.
    European investment banking giant Fortis NV expects world emissions trading markets to hit $100 billion in value this year and $400 billion by 2012 or 2015, when the U.S. is expected to be fully involved.

    Shane Spurway, director of Asian emissions banking, Fortis: "We expect the American market to be around four times the size of Europe…(The United States) will join an emissions trading agreement, where carbon will be a global commodity currency."

    A new study suggests Australia's cap-and-trade system, expected by 2012, could put an undue burden on that nation's working poor because they rely on auto transport but live in lower cost, outlying urban regions. Auto transport fuel is expected to cost impactfully more when a price is put on emissions.

    This could be an argument against cap-and-trade - but not a strong enough one to prevent it in the face of global climate change. It is, however, is a good reason to look at ways to make cap-and-trade more equitable. A good place to start would be
    cap and share, a “…scalable framework for climate stabilization…” in which “…responsibilities are shared around the world in a responsible way…” but the permits would start in the hands of citizens and then work their way into the marketplace.

    From the "cap-and-trade is coming" file: Surprisingly, China is opening a branch of Chicago Climate Exchange, the voluntary emissions trading platform, in its Binhai New Area in Tianjin, near Beijing. The present U.S. administration insists Beijing is the obstacle to a world emissions trading system and yet China opens a voluntary exchange - huh?

    This just shows how wrong-headed perceptions about the "inscrutable" east can be. China saw an opportunity to win an international client to its new, state-of-the-art business center so it signed on with CCX. What is emissions trading about? It is about turning a crisis (global climate change) into an opportunity (global emissions cap-and-trade).

    In this instance, China sees an opportunity in playing. Emissions trading, as it is presently practiced in Europe, would be in the best long term interests of the U.S. and the RIGHT world emissions trading scheme will be an opportunity for everybody. When are folks going to get that?


    Cap and Share might be more equitable than cap-and-trade AND be as effective. (click to enlarge)

    Interview – Fortis sees global carbon market up 67% in 2008
    Rujun Shen (w/Edmund Klamann), April 24, 2008 (Reuters)
    and
    Carbon trading to hit poor hard
    Reid Sexton, April 27, 2008 (The Age)
    and
    China to tie up with Chicago carbon emissions bourse
    April 25, 2008 (AFP via Yahoo News)

    WHO
    Belgian-Dutch financial group Fortis NV (Shane Spurway, director of Fortis carbon banking in Asia); Point Carbon; United Nations (UN) Clean Development Mechanism (CDM); Brotherhood of St. Laurence (BSL) (Janet Stanley, report co-author); Chicago Climate Exchange (CCX)

    click to enlarge

    WHAT
    Fortis’ Spurway sees emissions trading markets booming around the world and soon starting up in Asia and the U.S. At the same time, a Brotherhood of St Laurence report Carbon Use in Poor Victorian Households by Local Government Area finds the working poor to be among the hardest hit by the costs imposed by a trading system on emissions. And China announced it will participate in a voluntary emissions trading market.

    WHEN
    - Spurway sees the world emissions trading market valued at $100 billion by the end of 2008. He sees it getting to $400 billion by 2012 to 2015.
    - Spurway expects Asian emissions markets by 2009. Most of the UN CDM registered projects are in Asia.
    - Australia expects to institute a cap-and-trade system by 2012.

    The working poor in outer suburbs generate emissions just getting to and from work. (click to enlarge)

    WHERE
    - Fortis is based in Belgium and Holland.
    - Singapore, Hong Kong and Tokyo are potential emissions trading centers.
    - The BSL report focused on the working poor in the Australian state of Victoria but is thought to be generalizable.
    - China’s CCX trading center will be in the city of Tianjin, near Beijing

    WHY
    - World emissions trading was 2.7 billion tonnes last year, valued at $60 billion. These numbers were 64% higher than the previous year.
    - 1 Certified Emission Reduction (CER) is issued for each tonne of carbon dioxide equivalent (CO2e) cut by a UN CDM certified project
    - A credit trades at 10 to 15 euros ($15.80-23.80).
    - A tonne of CO2e cut from voluntary projects trades at $2 to $3.
    - The BSL study found that urban poor working households in cities w/o good public transport will pay as much as $1220/year with a $35/tonne price on emissions while those in inner and middle areas with good public transport would only pay around $900 to $1000 extra. Rural working poor without public transport will pay $1300+.
    - Because of Australia’s lack of public transport, many families earning less than $500/week require 2 cars.
    - The first value China gets from joining the CCX voluntary emissions trading platform is a new international client in its Binhai New Area in Tianjin.

    Cap and trade is the most likely way to do it. (click to enlarge)

    QUOTES
    - Spurway, director of Asian carbon banking, Fortis: "In Asia, apart from Japan, no country has compliance targets, so it's very hard to set up a trading system here until you have a good range of buyers and sellers…"
    - Spurway, on current voluntary emissions trading markets: "Because it's hard to verify, because it's not very transparent, because there's no neutral or independent measuring authority involved in it, the quality of these projects is risky…"
    - Spurway, on where and how emissions trading will meet the financial marketplace: "We would tend to think that it would be the CER that would be transferred between America, Europe and Japanese buyers…"
    - Janet Stanley, co-author, BSL report: "It suggests a strong argument for better public transport services around those suburbs…These people need to get to work, they need to get to the doctor … these people have no choice but to pay out extra money for mobility…It's at a cost to other things in their life. It could be their child can't afford to go on a school camp or they can't afford the school uniform."

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