NewEnergyNews: THE ECONOMICS OF EMISSIONS OFFSETS TRADING

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: The Ocean Speaks Out
  • Weekend Video: Adapting To The Inevitable
  • Weekend Video: The Joy Of Driving EVs Powered By The Sun
  • THE DAY BEFORE

  • FRIDAY WORLD HEADLINE-HOTTEST SEPTEMBER EVER; WORLD’S HOTTEST MONTHS STREAK AT SIX
  • FRIDAY WORLD HEADLINE-EU WIND BEATS FOSSIL, NUKE ENERGY PRICES
  • FRIDAY WORLD HEADLINE-DESERTEC SUCCUMBS TO MIDEAST TURMOIL
  • FRIDAY WORLD HEADLINE-JAPAN UPS PUSH FOR GEOTHERMAL
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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, Oct. 16:

  • TTTA Thursday-THE MILITARY FALLS FOR THE HOAX
  • TTTA Thursday-FORTUNE 100 BUSINESSES BOOST SUN
  • TTTA Thursday-IOWA UTILITY BUYS WIND TO CUT COSTS
  • TTTA Thursday-GETTING ENERGY EFFICIENCY FROM THE CLOUD
  • THE DAY BEFORE THAT

  • THE STUDY: NEW ENERGY BECOMES PRICE COMPETITIVE
  • QUICK NEWS, Oct. 15: NEW NUMBERS SHOW BIG OCEAN WIND POWER; SOLAR TURNS IN A NEW DIRECTION; FUEL CELL MARKETS TO VARY, GROW
  • AND THE DAY BEFORE THAT

  • THE STUDY: WORLD WIND COMES ON
  • QUICK NEWS, Oct. 14: THE UTILITY-SOLAR DEBATE OVER WHO PAYS; TECHNICIANS WANTED – APPLY TO WIND; MAKING MULTIFAMILY BLDGS MORE EFFICIENT
  • THE LAST DAY UP HERE

  • THE STUDY: A LOOK AT THE FUTURE OF CONCENTRATING SOLAR POWER PLANTS
  • QUICK NEWS, Oct. 13: NUCLEAR FADING, NEW ENERGY COMING ON; THE ONE BIG ADVANTAGE OF SOLAR; HALF OF GLOBAL HEAT MAY BE HIDING IN THE OCEANS
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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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  • Wednesday, August 27, 2008

    THE ECONOMICS OF EMISSIONS OFFSETS TRADING

    Investor/securities authority William D. Glubiak says emissions offsets trading is a fulfillment of the potential of Nobel laureate economist Milton Friedman’s free market economics.

    Glubiak observes, in what he calls the “green movement,” a move toward social responsibility in individuals’ and corporations’ choice of investments. And he describes how the free market, by moving to fulfill that demand, can serve both wealth and the environment.

    Glubiak: “…[H]ow do we blend these two seemingly opposite forces? Carbon trading can play a critical and perhaps earth-changing role.”

    The first step in social responsibility is something straight out of the Hippocratic Oath: “First, do no harm.” Be efficient. Generate no unnecessary emissions. How perfect: The planet is running a fever. Every citizen is a doctor charged, first and foremost, to do no further harm.

    An active life in a society designed around the generation of fuel by burning things, though, inevitably necessitates some harm. For that, there is the opportunity to invest in businesses that earn money using New Energy or using energy efficient methods. Such investments balance excess emissions by sponsoring reduced emission-activities.

    Businesses seeking to balance their excess emissions have the opportunity to sponsor businesses that generate New Energy. Buyers and sellers of such offsetting investments make a marketplace. Nothing could make Milton Friedman happier, Glubniak suggests.

    Glubiak sees innovation being driven by the “green movement” seeking investments for the socially responsible emissions trading marketplace. He sees engineers as the providers of the technology: “You can make Friedman proud and still save the planet!”
    He also points out, as evidence of the change the emissions trading marketplace has already created, that corporations are beginning to add the company’s carbon footprint and its socially responsible actions into annual reports. He is here describing the further emergence of what award-winning author and economist Hazel Henderson has called
    the sustainability sector.

    It is exciting to see a proponent of emissions offsets trading present an argument for socially responsible investing. Concern must remain about the so-far demonstrated inability of investors to recognize the difference between truly socially responsible investments (wind and solar energies) and those that merely promise it (corn ethanol, carbon capture and storage).

    E.F. Schumacher: “The system of nature, of which man is a part, tends to be self-balancing, self-adjusting, self-cleansing. Not so with technology.”


    Cap and Share is a socially responsible version of Cap and Trade. (click to enlarge)

    Commentary: Carbon credit trading, the green movement and the demise of Milton Friedman
    William D. Glubiak, August 25, 2008 (EE Times)

    WHO
    Milton Friedman, economist, Nobel Laureate; William D. Glubiak, representative, Securities America Inc./member, FINRA/SIPC and Securities America Advisors; Engineers

    WHAT
    Friedman advocated the most unfettered market activity. Emissions trading could be the free market’s way of controlling greenhouse gas emissions and the global climate change they induce.

    Mr. Freidman's most accessible book. (click to enlarge)

    WHEN
    - Friedman died in 2006. He was one of the most influential economists of the 20th century. - The MOST influential? Well, Keynes has exerted influence for about twice as long. But then there is Keynes’ own remark, “In the long run, we’re all dead.” He and Friedman most certainly are.
    - If the most apocalyptic of the Peak Oilers turn out to be right, E.F. Schumacher, author of Small Is Beautiful, may someday to be seen as more influential than Keynes or Friedman.
    Chicago Climate Exchange (CCX) was formed in 2003.

    WHERE
    - The idea of being carbon neutral can be like an “above the line” and “below the line” opposition. Emissions by those “above the line” are balanced by those “below the line.”
    - CCX is emerging as the primary arena for trading voluntary emissions offsets.

    WHY
    - Social responsibility drives investors toward carbon neutrality and toward investments that offset activities that generate emissions.
    - Basic premise: Humans pollute and so do corporations.
    - Carbon footprint: How much we pollute. A reduced carbon footprint equals less environmental harm.
    - Carbon neutrality equals zero environmental impact. (?)
    - Keys to carbon neutral practice: Green design, energy efficient technology.
    - Investment vehicles, growing in volume, that balance excessive emissions: Alternative energy sources [wind, solar power, geothermal, nuclear energy(?), biofuels (?)]
    - Engineers have the key skill set to develop technology at which trading investments aim.

    The most important economic text of its time? (click to enlarge)

    QUOTES
    - Glubniak: “Will carbon credit trading and the green movement lead to the demise of Milton Friedman's philosophy? Not a chance! We have entered into a time of awareness that our Blue Planet faces some serious challenges. But the green movement, combined with advances in technology and some smart investing, offers economic opportunities worldwide. Keep your eyes open. There's a movement afoot, but Friedman's economics will prevail.”
    - E.F. Schumacher: “Infinite growth of material consumption in a finite world is an impossibility.”

    1 Comments:

    At 9:05 AM, Blogger Ron Robins said...

    Thought not specifically related to this post, but certainly warrants consideration is green-socially responsible investing.

    I've been following it for around forty years and have a unique site that covers the latest global news and research in this area. It's at www.investingforthesoul.com

    Best wishes, Ron Robins

     

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