QUICK NEWS, December 6: CHINA TALKS CLIMATE DEAL; NEWT ON CLIMATE CHANGE; SUPPORT FOR NEW ENERGY

CHINA TALKS CLIMATE DEAL
Flexibility at Durban gives hope
Lan Lan and Li Jing, 2011 December 6 (China Daily)

"China's openness toward a legally binding climate deal that would come into effect after 2020 has given a boost to the ongoing climate change talks in Durban…Experts said the flexibility that China showed is encouraging, but it's also important to pressure developed countries for much deeper emission reduction targets…"

"…Xie Zhenhua, China's top climate negotiator… laid out five preconditions [for] a legal framework, including an extension of the Kyoto Protocol and actions by developed countries to help developing countries adapt to climate change…Xie, deputy minister of the National Development and Reform Commission, said there are no new requirements, but countries need to implement the commitments and legal documents that have already been agreed to."

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"Tim Gore, Oxfam climate change policy adviser, said what seems to be missing in China's conditions is requesting deeper emission reduction targets from developed countries before 2020…The fate of the Kyoto Protocol, regarded as the cornerstone and most crucial issue at the meeting by developing countries, is still in the air one week into the conference…

"…Developed countries are being urged to sign onto a new round of enforceable pledges under the Kyoto Protocol…The first commitment period of the treaty will expire in 2012…So far, no country has said they will not continue the Kyoto Protocol, while some said they won't have a second commitment period…A plausible outcome of the Durban meeting seems to be that the EU and some other developed countries confirm their targets for a second commitment period…China also announced it is looking to expand cooperation with climate vulnerable countries, such as small island states, least-developed countries and African nations…"


NEWT ON CLIMATE CHANGE
Fact Check: Gingrich on Climate Change; Newt Gingrich went too far when he claimed that "I've never favored cap-and-trade."
Brooks Jackson, December 5, 2011 (FactCheck.org via USA Today)

"…[H]e's never favored the approach taken by Democrats, but he said in 2007 that he would ‘strongly support’ cap-and-trade if combined with ‘a tax-incentive program for investing in the solutions.’ …[I]n House testimony in 2009 that he [said he] still might support a cap-and-trade system covering ‘the 2,000 most polluting places,’ if packaged with incentives for nuclear power and ‘green coal,’ among other things.

"…[He] has said there's enough scientific evidence to warrant government action, and has never stood with those conservatives who dismiss evidence of human causation as a hoax.’…But at times he's hedged his stand on the evidence…[saying] the evidence is ‘sufficient’ to warrant acting ‘urgently’ and that there is a ‘wealth of scientific data’ that warming is taking place. But at other times he's said that global warming is ‘probably’ happening and that there's no ‘conclusive’ proof of it, or that humans cause it. He's even suggested that the Earth may be about to move ‘into a long cooling period.’"



"And he's also gone from voicing strong — though conditional — support for a cap-and-trade approach to his current position focused entirely on encouraging development of new technologies, with no mention of capping emissions.

"The former speaker's most recent attempt to explain his evolving position came in a Dec. 3 appearance at a Fox News forum...[but] Gingrich went overboard when he [said] he "never favored cap-and-trade." That's not true. He would have been accurate to say he never favored ‘[Nancy] Pelosi's cap-and-trade…But the truth is that he said in 2007 that he ‘strongly’ supported the concept of a cap-and-trade system to address climate change, if packaged with incentives. He even said the world would be ‘much better off’ if President George W. Bush had not rejected the idea of a mandatory cap on carbon dioxide emissions from electric power plants in 2001, and adopted such a cap-and-trade-plus-incentives package…"


SUPPORT FOR NEW ENERGY
New Money, Investors, and Finance Models Needed to Keep US Renewable Energy on Track
21 November 2011 (Bloomberg New Energy Finance)

"With electricity demand weak and stimulus funds dwindling, the US renewable energy sector must attract new investors and make use of unique tax-based financing structures in the next 18 months or risk a sharp drop in new project builds, according to new research by specialist research firm Bloomberg New Energy Finance…

"The clean energy industry in the US has been a major beneficiary of public support from the American Recovery and Reinvestment Act in the form of over $65bn in tax credits, grants, and soft loans. But nearly all of those stimulus funds have now been deployed. Unless the private sector steps into the breach with substantial new investment, project development will slow…"

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"…Growth in the US renewable sector has been largely driven by the availability of tax equity or its temporary substitute in the aftermath of the financial crisis, the cash grant…Alternative sources of tax equity may need to emerge to meet [the $7 billion] market demand for project finance…There is a vast pool of potential incremental tax equity supply: the 500 largest public companies in the US alone paid $137bn in taxes over the past year…Expiry of the cash grant should not be expected to result in collapse of the US renewable sector…However, significant uncertainty will remain until Congress reaches a decision about whether or not to extend the production tax credit…

"…The three primary tax equity structures offer distinct advantages to developers and tax equity investors…partnership flip…sale leaseback…[and] an inverted lease…The economics of these structures can be attractive…[Developers can get] returns of 6-19% and investors [can get] 10-49% for wind projects…The choice of investment versus production tax credits (ITC vs. PTC) comes down to the three ‘P’s: performance, perspective and priorities…The optimal tax equity structure depends on the project characteristics... but perfect optimisation may be a pipedream..."