Category Archives: Economy

Climate action and economies can grow together

Investing in renewables such as solar energy can spur economic activity Image: Alex Snyder/Wayne National Forest via Wikimedia Commons
Working together: investing in renewables such as solar energy can spur economic activity
Image: Alex Snyder/Wayne National Forest via Wikimedia Commons

By Kieran Cooke

A new global commission report by major political and business figures refutes the claim that economic expansion and tackling climate change can’t both be achieved at the same time.

LONDON, 17 September, 2014 − We can have our cake and eat it. That’s the main message of a new study that says the idea that we have to choose between battling against climate change or promoting growth in the world’s economy is a “false dilemma”.

The report, The New Climate Economy, was produced by the Global Commission on the Economy and Climate, chaired by Felipe Calderón, the former president of Mexico, and including eminent economist Lord [Nicholas] Stern.

Calderon, addressing what he describes as a “false dilemma”, says: “The message to leaders is clear. We don’t have to choose between economic growth and a safe climate. We can have both.”

Lord Stern, author of the 2006 Stern Review, which comprehensively detailed, for the first time, the economic consequences of not taking action on climate change, says decisions being made now will determine the future of both the economy and the climate.

High-quality growth

“If we choose low-carbon investment, we can generate strong, high-quality growth – not just in the future, but now,” he says. “But if we continue down the high-carbon route, climate change will bring severe risks to long-term prosperity.”

The commission’s report, released at the United Nations in New York shortly before a major UN climate summit, says there are now big opportunities for achieving strong economic growth and, at the same time, lowering emissions across three sectors:

  • Building more compact, better connected cities will improve the quality of life of urban dwellers, improve economic performance, and lower emissions.
  • Improved land use can cut emissions resulting from deforestation. Restoring 12% of the world’s degraded land would dramatically raise farmers’ incomes.
  • More and more of the world’s energy is likely to be generated by renewables, cutting dependence on highly-polluting coal. Renewables is now a big growth industry, spurring on various economic activities.

The report says that about US$90 trillion is likely to be invested in infrastructure in the world’s cities, agriculture and energy systems over the next 15 years, and spending should be directed towards low-carbon growth that would not only benefit the climate but also business productivity.

The study calls for the phasing out of huge amounts spent worldwide on subsidies for fossil fuels – currently US$600 billion, compared with US$100bn for renewable, the report says. Competitive energy markets, consistent government policy, a strong price for carbon, and greatly expanded research in low carbon technologies are also needed.

If fully implemented, the report’s authors calculate, a reduction of up to 90% in emissions could be achieved by 2030, and dangerous climate change would be averted.

Meaningful action

Although the report’s findings have been endorsed by a wide range of leading politicians, business figures and economists, there are those who would argue against the idea that economic growth can be achieved alongside meaningful action on climate change.

For example, the New Economics Foundation (NEF), a UK thinktank, contends that indefinite global economic growth is unsustainable.

In a 2010 report, Growth Isn’t Possible, the NEF said economic growth is constrained by the finite nature of the planet’s natural resources. “Growth forever, as conventionally defined, within fixed though flexible limits, is not possible,” it said. “Sooner or later, we will hit the biosphere’s buffers.”

Others would point out that although a carbon market has been in operation for several years, the price of carbon has failed to rise. The introduction of market forces and competition in the energy sector in many countries has done little to lessen greenhouse gas emissions.

In many countries, including India, China, Australia and some states in Europe, a central role in driving economic growth is still played by coal, the most polluting of all energy sources. – Climate News Network

Climate and economy fan flames in Spain

A swathe of forest destroyed by wildfire in northern Spain Image: DM Molina Terrén via Wikimedia Commons
Burn scars: a swathe of forest destroyed by wildfire in northern Spain
Image: DM Molina Terrén via Wikimedia Commons

By Tim Radford

The combined forces of climate, economic and social change are leaving Spain increasingly exposed to the damaging and costly effects of wildfires.

LONDON, 21 August, 2014 – Climate change is gradually turning Spain into a fire zone – but it’s also the change in the economic climate that is inflaming the situation.

A research group reports in the journal Environmental Science and Policy that a mix of factors is behind the rise in both the numbers of forest fires and the areas of land scorched over the last 40 years.

Vanesa Moreno, a researcher in the geography department at the University of Alcalá in Madrid, and colleagues studied the pattern of fires in Spain from 1968 to 2010.

Natural outbreaks

Although Spain, like much of southern Europe, is expected to become more arid with global warming, and although some Mediterranean vegetation is adapted to − and even benefits from − natural fire outbreaks, the picture is not a simple one.

In the moister Atlantic north-west of the country, there are two fire seasons − at the end of winter, and in the summer. In the Mediterranean region, fires are more frequent in the long, hot summer.

Climate change, with more prolonged droughts and rising temperatures, is certainly a driving force, but another factor has been the way the land is now used.

Increasingly, agriculture has intensified and old customs have withered away. Traditional shepherding practices once relied on using fire to keep pastures clear, and, as these practices were abandoned, the risk of accidental scrub and bush and forest fire fell.

But at the same time, like everywhere else in the world, people began to abandon the rural landscape and move to the cities, which in turn means more uncontrolled vegetation growth, more tinder and dried leaves to ignite, and a greater risk of forest fire once more.

Additionally, there have been new reforestation policies, and new plantations for pulp and paper, so that there is more forest to catch fire.

Woodland now covers 37% of the 493,000 square kilometres under study, and the animal population per sq km has fallen from 45 sheep, goats or cattle to a mere 12. So social change, too is fuelling the fire hazard.

Alarming number

Across the Atlantic, from Alaska to California, wildfires are on the increase. Europe, too, has this summer been hit by an alarming number of fires. But knowledge is power, and the Spanish know what to expect.

Moreno says: “Management has evolved and become more effective through the acquisition of fire suppression resources, professional training, research, the introduction of technologies and prevention − something that has got a lot of attention in recent years.” says Moreno.

But that does not mean the fire situation is under control. “The occurrence of several fires at the same time means that resources and personnel have to be split, and extinguishing fires takes more time,” Moreno says.

“In this regard, the economic crisis has caused the workforce to be cut, which could reduce fire extinguishing ability.” – Climate News Network

Mystery over Kazakh nuclear power plans

Sign for a uranium mining operation in southern Kazakhstan Image: Mheidegger via Wikimedia Commons
Sign for a uranium mining operation in southern Kazakhstan
Image: Mheidegger via Wikimedia Commons

By Komila Nabiyeva

Russia intends to build the first thermal nuclear power plant in Kazakhstan, the world’s largest uranium producer. But where it will be in that vast country and who will own it remain unclear.

BERLIN, 18 August, 2014 – As the Russian President, Vladimir Putin, signed the recent deal forming the Eurasian Economic Union with his counterparts from Belarus and Kazakhstan in the Kazakh capital city of Astana, one controversial agreement went relatively unnoticed.

On the same day, May 29, the Russian state nuclear corporation, Rosatom, signed a memorandum of understanding (MoU) with the Kazakh national atomic company, Kazatomprom, on constructing the first nuclear power plant in Kazakhstan.

The MoU lays out intentions of both parties on design, construction, commissioning, operation and decommissioning of a nuclear power plant with water-water energy reactors (VVER) –  that is, water-cooled water-moderated reactors  – with an installed capacity of 300 to 1,200 MW, according to the Rosatom press release. But other vital details about where the plant will be and who will own and operate it remain a mystery.

It seems surprising that Kazakhstan has not had a thermal nuclear plant before, especially as most of Russia’s uranium comes from local mines, which last year provided 38% of the world’s supply. One explanation may be the strength of the public protests against the construction of a nuclear power station.

Experimental reactor

Russia did build an experimental fast breeder reactor near Aktau city on the Caspian Sea in 1973, but it closed in 1999. Since then, the Kazakh government has been keen to build a conventional nuclear station as a replacement.

Russia has close ties with Kazakhstan because the country has been used for Russia’s space programme and nuclear testing. Its vast, flat desert interior was seen as a perfect launch pad. Large areas of what is the world’s largest landlocked country can be isolated without inconveniencing the population of 17 million, most of whom live along the greener border areas of the country.

From the Kazakh point of view, nuclear power is a vital part of the country’s plan to improve its green credentials, launched last year by President Nursultan Nazarbayev. Currently, oil from the Caspian Sea is enriching the government, but is exacerbating climate change.

According to the green plan, Kazakhstan is to increase the share of alternative and renewable energy in electricity generation from less than 1% to 50% by 2050. Nuclear power is part of the planned energy mix. .

The construction of the nuclear power plant will involve Russian loans, but the question of its ownership remains open, Vladislav Bochkov, from the Rosatom press office, told the Climate News Network.

The signed document mentions the possibility of production of atomic fuel or its components in Kazakhstan, as well as co-operation on nuclear waste management and the personnel training. The official intergovernmental agreement is to be signed by the end of 2014, Bochkov said.

Site ambiguous

The site of the plant also remains ambiguous. In media interviews, Rosatom said the plant will be constructed in Kurchatov, a city in north-east Kazakhstan, near the former Soviet Semipalatinsk nuclear test site.

However, in an interview on the Astana TV channel, the head of Kazatomprom, Vladimir Shkolnik, said that two nuclear power plants may well be constructed − one in Kurchatov, and one near the Balkhash Lake in south-east Kazakhstan.

It is clear that Kazakhstan has been keen on building nuclear plants for some years. “The demand for cheap nuclear energy, in the foreseeable future, will only increase,” President Nazarbayev said during his annual address in January this year.

“We have to develop our own fuel industry
and build nuclear power stations”

“Kazakhstan is the world leader in uranium production. We have to develop our own fuel industry and build nuclear power stations”

Today, Kazakhstan generates more than 80% of its electricity from coal. However, as a result of the country’s outdated coal mining and production industry, its emissions have risen 40% since 2006.

In its 2010 submission to the UN Framework Convention on Climate Change, Kazakhstan pledged, on a voluntary basis, that by 2020 it would reduce its greenhouse gas emissions to 15% below its 1992 levels.

Dmitry Kalmykov, director of EcoMuseum, a Kazakh environmental NGO, said: “From the economic point of view, the interest of the Kazakh government to develop nuclear power is understandable. The country leads in uranium production, it used to have parts of the production cycles of atomic fuel, and even the personnel since Kazakhstan still runs four testing reactors.

“Yet, so far, the government has not provided any information on how economically rational it is in comparison with coal or renewable energy.”

Kalmykov said the choice of Kurchatov in the north-east as the site for the plant appears questionable. He said: “We already have, 150-160 km from Kurchatov, two gigantic Ekibastuz coal power stations, the biggest in the country, and another one nearby. Everybody knows in Kazakhstan that there is oversupply of energy in the north. The biggest need for energy is in the south.”

Kazakhstan’s electricity grid system was historically divided into three networks, with two in the north connected to the Russian system and the southern one connected to the Central Asian energy system.

Petr Svoik, an opposition politician and analyst in Kazakhstan, wrote on the Forbes.kz website that a nuclear power plant in Kurchatov makes little sense for the energy needs of Kazakhstan. “Its only advantage is convenience of energy export to Russia,” he said. “In fact, it will be a Russian nuclear power plant on the Kazakh territory.”

Expand capacity

In an interview with the Climate News Network, Svoik said the MoU on constructing a nuclear power plant gives Kazatomprom a chance to expand its capacity from uranium mining and first processing to the company dealing with the full nuclear cycle, including the atomic fuel production.

Since 1973, the Ulba metallurgical plant in the east of Kazakhstan has been producing nuclear fuel pellets from Russian-enriched uranium.

Vladimir Slivyak, from the Russian environmental group Ecodefense, said Rosatom constructs only 1200 MW reactors, whereas Kazakhstan needs less capacity.

“The only exception is a very old reactor built during the Soviet times in the 1980s,” he said. “Formally, Rosatom has smaller projects, but they never developed to the implementation stage. So it cannot just start constructing a smaller reactor, but would need five to six years for the equipment to be developed.”

Sending a signal

Slivyak said Russia might be sending a signal to the West that it has other partners, despite the economic sanctions.

He said: “In such a tight political situation, with a conflict with the Ukraine and a number of countries introducing sanctions against the country, the Russian government in response demonstrates its establishment of a new trade-economical union with some countries from the former Soviet Union. To give it weight, a range of bilateral agreements is signed, and the MoU on construction of a power plant is one of them.”

Slivyak said he was sceptical about the MoU because plans about constructing the nuclear power plant in Kazakhstan by Russia have appeared in the news over the last 10 years, but never reached the stage of the official intergovernmental agreement or a contract.

On being asked by the Climate News Network for an interview, the Kazatomprom press office said to contact Rosatom for comments, as “the memorandum was their initiative”. However, the Rosatom press office declined to provide the MoU text. – Climate News Network

  • Komila Nabiyeva is a Berlin-based freelance journalist, reporting on climate change, energy and development.

Top 20 oil projects put investors’ billions at risk

An oil extraction platform in the North Sea, off the coast of Norway Image: Håkon Thingstad via Wikimedia Commons
An oil extraction platform in the North Sea, off the coast of Norway
Image: Håkon Thingstad via Wikimedia Commons

By Alex Kirby

An oil industry thinktank warns that high-cost extraction projects failing to match oil demand with global emissions reduction targets could waste US$91 billion of investors’ money over the next decade. 

LONDON, 15 August 2014 – If you want a safe bet, don’t invest in some of today’s tempting oil and gas projects. That’s the message from a UK-based financial thinktank that aims to align the global energy market with climate reality.

The report, by the not-for-profit Carbon Tracker Initiative (CTI), warns that US$ 91 billion of investors’ money risks going to waste over the next decade because of the industry’s plans.

It highlights a top 20 of the world’s most expensive future oil projects being considered for development, and concludes that, to be profitable, some of them will need oil prices to be far higher than today’s levels.

The findings in the report, CTI says, demonstrate the mismatch between continuing oil demand and reducing carbon emissions to limit global warming.

Economic justification

Since an earlier CTI report in May this year, institutional investors have been asking for more details of the economic justification for projects that require high oil prices.

This latest research ranks oil majors according to their capex (capital expenditure) exposure to undeveloped, high-cost projects, and reveals the projects at highest risk.

The companies, CTI says, need to reduce exposure to exploration projects that must earn the highest prices for their oil, and that this is the principle that should determine investment decisions, rather than the simple pursuit of production volume.

“This analysis demonstrates the worsening
cost environment in the oil industry”

All the fields require at least $95 a barrel to be sanctioned, identified by CTI as the key risk level −  the market price required to go ahead with the project, assuming a $15 contingency allowance or “risk premium” on top of the break-even price.

Some projects will need prices above $150 per barrel. The global Brent oil benchmark has ranged between $99 and $114 per barrel over the past 12 months.

Using data from the independent consultants Rystad Energy, CTI finds that BP, ConocoPhillips, ExxonMobil, Chevron, Total, Eni and Royal Dutch Shell are considering investing a total of $357 billion over the next decade on new production in costly and often technically-challenging projects − ranging from Canadian oil sands to deep water finds in the Gulf of Mexico and discoveries in the Arctic.

Both BP and Total have particularly high exposure to deep water and ultra-deep water projects, while ConocoPhillips is heavily exposed to Arctic projects. High carbon-emitting oil sands projects account for 27% and 26% respectively of Shell’s and Conoco’s potential high-cost development spend.

“This analysis demonstrates the worsening cost environment in the oil industry, and the extent to which producers are chasing volume over value at the expense of returns,” said Andrew Grant, CTI analyst.

Projects shelved

Some majors have started cutting already. For example, in the Canadian oil sands sector so far this year, Total and Suncor have shelved the $11bn Joslyn mine project, and Royal Dutch Shell has put on hold its Pierre River project.

With deep-water projects, BP has delayed/cancelled its Mad Dog extension in the Gulf of Mexico, and Chevron is reviewing its $10bn Rosebank project in the North Sea.

In the Arctic, Statoil and Eni have deferred a decision on the $15.5bn Johan Castberg project.

The CTI report says projects that depend on sustained high prices for a return are at risk from a future double hit of falling oil prices and growing climate regulation in an increasingly carbon-constrained world.

Its study in May this year showed that oil prices have twice fallen as low as $40 per barrel in the last decade.

The US Energy Information Administration recently reported that the oil and gas sector has increased borrowing heavily to cover spending and dividends. − Climate News Network

Tar oil pipeline’s hidden pollution danger

Keystone pipeline protest in Olympia, capital of Washington state, US Image: Brylie Oxley via Wikimedia Commons
Keystone XL pipeline protest in Olympia, capital of Washington state, US
Image: Brylie Oxley via Wikimedia Commons

By Alex Kirby

European researchers say a 2,000-mile pipeline designed to carry controversial tar sands oil from Canada to the southern US may lead to much more pollution than previously calculated.

LONDON, 14 August, 2014 − The oil industry has high hopes of the US$5.4 billion Keystone XL pipeline, which on completion is planned to carry crude oil from Canada’s tar sands in Alberta to refineries more than 2,000 miles away in Texas.

With President Barack Obama saying he will approve Keystone only if it “does not significantly exacerbate the problem of carbon pollution”, the pipeline’s future is seen by many inside and outside the US as an acid test of his resolve to tackle climate change.

But in a report that questions US State Department calculations of Keystone’s impact, researchers in Europe say it could increase carbon emissions by much more than anyone has so far calculated.

Emissions increase

The research team, from the Stockholm Environment Institute (SEI), says the pipeline could increase world greenhouse gas emissions by as much as 121 million tons of carbon dioxide a year − more than four times higher than the State Department’s estimated total of 30 million tons at most.

The official figure, the SEI says, ignores the fact that the extra oil refined once the pipeline is working will cause prices to fall by about $3 a barrel, increasing consumption and, with it, carbon emissions. The SEI report is published by the journal Nature Climate Change.

To put the possible 121 million ton figure in perspective, the total amount of CO2 emitted globally in 2013 was 36 billion tons.

The American Petroleum Institute said the study was irrelevant because the tar sands would be developed anyway and oil would be transported to the southern refineries by rail if not by pipeline.

But Ken Caldeira, an atmospheric scientist at the Carnegie Institution for Science’s Department of Global Ecology in Washington, while agreeing that the total emissions increase is small, said the concern was more about the idea of boosting emissions than the degree of change.

Tar sands arouse vehement opposition from environment groups and from many communities in Alberta.

Concerns about exploiting the sands include the impact on health and safety, water resources, air pollution and soil damage. Beyond that, some analysts are increasingly arguing that the world cannot afford to burn most of its fossil fuel reserves (including unconventional oil, such as that from tar sands) if it is to avoid catastrophic climate change.

Oil prices

The authors of the SEI study, Peter Erickson and Michael Lazarus, found that, for every barrel of increased production, global oil consumption would increase by 0.6 barrels because of the resulting fall in world oil prices.

Taking other variables into account, they calculated that the net annual impact of Keystone XL could range from virtually nothing to 121 million tons of CO2 equivalent − a spread much wider than that found by the State Department, which did not account for global oil market effects.

“The key message is that the oil market impacts of Keystone XL could be significant – and have an emissions impact four times greater than the US State Department found,” Erickson told Responding to Climate Change, a London-based news and analysis website.

“That also suggests that more of this type of analysis − analysing the possible market effects of other fossil fuel infrastructure projects − could be warranted, as they could have similar effects”. − Climate News Network

US climate change debate heats up

Skiing areas such as Colorado are being hit by warmer winters Image: DebateLord at Wikimedia Commons
Skiing tourism areas such as Colorado are being hit by warmer winters
Image: DebateLord at Wikimedia Commons

By Kieran Cooke

Groups for and against US government plans for new regulations aimed at cutting greenhouse gas emissions have been slugging it out at a series of heated debates across America.

LONDON, 11 August, 2014 − Achieving progress in cutting back on greenhouse gas emissions and preventing serious global warming is never easy. But just how difficult a task that is became clear at a series of recent meetings across the US held to discuss the Obama administration’s latest plans for tackling climate change.

Those plans, announced in early June by the government’s Environmental Protection Agency, call for substantial nationwide cuts in greenhouse gas emissions.

Power companies − in particular, those operating coal-fired plants − will have to make big adjustments, reducing overall CO2 emissions by 25% on 2005 levels by 2025 and by 30% by 2030.

The EPA-sponsored public meetings, held in four US cities, were packed.

Long overdue

In Denver, in the state of Colorado, representatives of the skiing industry − a vital part of the state’s economy − said the new regulations were long overdue.

Skiing organisations said changes in climate were already happening and the industry was being badly hit, with drier and warmer winters resulting in less and less snow.

But coal mining is also central to Colorado’s economy. One resident of a coal mining community told the meeting: “The environmental extremist war on coal is really a war on prosperity. Coal means families can buy homes and put food on the table.”

The multi-billion dollar US coal industry is training its big guns on the EPA proposals.

Fred Palmer, a representative for Peabody Energy Corporation, the biggest coal producer in the US, told a meeting at the EPA’s HQ in Washington that the government should provide more funds for new technologies such as carbon capture and storage.

“Climate change is an issue we need to deal with in the right way,” Palmer said, “The only way to approach it is with technology, not with command-and-control from Washington.”

Other coal lobbyists have been wading into the fray. The American Coalition for Clean Coal Electricity said the EPA’s emissions cutting programme “threatens to dismantle our nation’s economy, fundamentally alter the American way of life, and severely hamper US energy independence and leadership”.

Groups of campaigners in favour of the EPA proposals demonstrated at the meetings, with the area round the EPA’s Washington office turned into the site of a large green carnival.

Adamantly opposed

Although the Obama administration has a considerable battle on its hands – with many politicians, corporate groups and powerful business organisations adamantly opposed to the new proposals – there are signs that the White House is determined to implement the measures.

Coinciding with the public meetings around the country, the government’s Council of Economic Advisers issued a report saying cutting emissions makes sense economically, as well as environmentally.

For each decade that action on emissions is delayed, costs of meeting reduction targets rise by more than 40%, the report says.

The public mood about the seriousness of climate change and the need to take action seems to back Washington’s stance.

A recent poll carried out by the ABC news network in the US and the Washington Post found that seven out of 10 people think global warming is a serious problem that needs to be tackled – and more than 60% of those questioned wanted action on emissions, even if it means higher energy bills. – Climate News Network

Ignoring climate risks could sink US economy

Flood devastation after Hurricane Katrina hit Louisiana in 2005 Image: Infrogmation via Wikimedia Commons
Harsh reminder: devastation after Hurricane Katrina hit Louisiana in 2005
Image: Infrogmation via Wikimedia Commons

By Alex Kirby

Failure to factor immediate action on climate change into American policies and business plans aimed at economic prosperity will lead to havoc, warns former US Treasury Secretary.

LONDON, 3 August, 2014 − For the second time in a month, Americans have been warned that the economic cost of not acting on climate change is likely to be calamitous.

Robert Rubin, the co-chairman of the influential, non-partisan Council on Foreign Relations, says the price of inaction could be the US economy itself.

Writing in the Washington Post, Rubin, a former US Treasury Secretary, argues: “When it comes to the economy, much of the debate about climate change − and reducing the greenhouse gas emissions that are fuelling it − is framed as a trade-off between environmental protection and economic prosperity,

“But from an economic perspective, that’s precisely the wrong way to look at it. The real question should be: ‘What is the cost of inaction?’”

Widespread disruption

He backed the Risky Business Project, a research initiative chaired by a bi-partisan panel and supported by him and several other former Treasury Secretaries. It reported in June that the American economy could face significant and widespread disruption from climate change unless US businesses and policymakers take immediate action.

In his opinion article in the Washington Post, Rubin argues that, in economic terms, taking action on climate change will prove far less expensive than inaction. He wrote: “By 2050, for example, between $48 billion and $68 billion worth of current property in Louisiana and Florida is likely to be at risk of flooding because it will be below sea level. And that’s just a baseline estimate; there are other scenarios that could be catastrophic.

“Then, of course, there is the unpredictable damage from superstorms yet to come. Hurricane Katrina and Hurricane Sandy caused a combined $193 billion in economic losses; the congressional aid packages that followed both storms cost more than $122 billion.

“And dramatically rising temperatures in much of the country will make it far too hot for people to work outside during parts of the day for several months each year − reducing employment and economic output, and causing as many as 65,200 additional heat-related deaths every year.”

Rubin believes a fundamental problem with tackling climate change is that the methods used to gauge economic realities do not take climate change into consideration. He wants climate-change risks reflected accurately, and companies required to be transparent in reporting vulnerabilities tied to climate.

“If companies were required to highlight their exposure to climate-related risks, it would change investor behaviour, which in turn would prod those companies to change their behaviour,” he argues.

Flawed picture

“Good economic decisions require good data. And to get good data, we must account for all relevant variables. But we’re not doing this when it comes to climate change − and that means we’re making decisions based on a flawed picture of future risks.

“While we can’t define future climate-change risks with precision, they should be included in economic policy, fiscal and business decisions, because of their potential magnitude.”

Rubin says the scientific community is “all but unanimous” in agreeing that climate change is a serious threat. He insists that it is a present danger, not something that can be left to future generations to tackle.

“What we already know is frightening, but what we don’t know is more frightening still,” he writes. “For example, we know that melting polar ice sheets will cause sea levels to rise, but we don’t know how negative feedback loops will accelerate the process. . . And the polar ice sheets have already started to melt.”

He concludes: “We do not face a choice between protecting our environment or protecting our economy. We face a choice between protecting our economy by protecting our environment − or allowing environmental havoc to create economic havoc.”

The White House’s Council of Economic Advisers  has estimated that the eventual cost of cutting greenhouse gas emissions will increase by about 40% for every decade of delay, because measures to restrict them will be more stringent and costlier as atmospheric concentrations grow. − Climate News Network

Boom-or-doom riddle for nuclear industry

Doubling up: solar panels at a nuclear power plant in the Czech Republic. Image: Jiří Sedláček (Frettie) 
Doubling up: solar panels at a nuclear power plant in the Czech Republic.
Image: Jiří Sedláček (Frettie) via Wikimedia Commons

By Paul Brown

The nuclear industry remains remarkably optimistic about its future, despite evidence that it is a shrinking source of power as renewables increasingly compete to fill the energy gap. 

LONDON, 26 July, 2014 − The headline figures for 2014 from the nuclear industry describe a worldwide boom in progress, with 73 reactors presently being built and another 481 new ones either planned or approved.

The World Nuclear Association (WNA) official website paints a rosy picture of an industry expected to expand dramatically by 2030. It says that over the period 1996 to 2013 the world retired 66 reactors, and 71 started operation. Between now and 2030, the industry expects another 74 reactors to close, but 272 new ones to come on line.

This represents a much larger net increase in nuclear electricity production than the basic figures suggest because most of the newer power stations have a bigger capacity than those closing down.

Pipe dream

Detractors of the industry say that these projections are a pipe dream and that nuclear power will not expand at that pace, if at all, and that solar and wind power will grow much faster to fill the energy gap.

Which projection is correct matters enormously because the world is both short of electric energy and needs to replace fossil fuels with low carbon sources of power to save the planet from dangerous climate change. Nuclear energy and renewables such as wind and solar are in competition to fill the gap.

The figures show that nuclear production is currently in decline from a peak in 2006, and is now producing less than 10% of the world’s electricity needs.

World solar capacity, on the other hand, increased by 35% in 2013, and wind power by 12.5% − although, added together, they still do not produce as much power as nuclear.

All the evidence is that wind and solar will continue to grow strongly, and particularly solar, where technological advances and quantity of production means that prices have dropped dramatically.

Costs of producing energy are hard to compare because solar is small and local and dependent on sunshine, while nuclear is large and distant and must be kept on all the time. However, research suggests that solar is already producing cheaper power per kilowatt hour than nuclear, the costs of which have not come down.

Commercial market

Both costs and time seem to be major factors in deciding which technology will gain market share. Nuclear stations are expensive and a long time passes before electricity is produced, making them almost impossible to finance in a normal commercial market. Solar panels, in contrast, can be up and running in days, and wind turbines within weeks.

Historically, nuclear power plants have always been built with government subsidy – a pattern that is continuing across the world. For example, the two countries with the largest number of reactors under construction − China, with 29, and Russia, with 10 − have populations with no democratic say in the matter.

Critics of the WNA figures say that while the claims for reactors planned and proposed might be real, the chances of most of them actually being built are remote.The US is said to have five reactors under construction, five more planned and 17 proposed – but with existing nuclear stations closing because they cannot compete with gas on price, it is unlikely that all of these will be completed by 2030.

The UK, which has a government keen to build nuclear stations, is said to have four stations planned and seven more proposed. The first of these stations was due to be opened by 2017, but work has not yet been started. The earliest completion date is now expected to be 2024, and the rest will follow that.

The delay in Britain is partly because the subsidies offered to French, Chinese and Japanese companies to build the UK reactors are under investigation by the European Commission to see if they breach competition rules.

Massive subsidies

Martin Forward is from the English Lake District, where one of the four nuclear stations is planned, and runs Cumbrians Opposed to a Radioactive Environment. He said: “I cannot see how nuclear has any future in Europe because of cost. Nuclear needs massive subsidies to be financially viable, but these are currently illegal under European law, so it is unlikely that the British ones will be built.

“Even if the government can get over that hurdle, there are many problems to overcome − for example, the designs of the stations have to be finalised. The process could take years, by which time wind, solar and other renewables will have expanded so much it will make nuclear redundant.”

The industry does not accept this, pointing to the US, where utilities hope that all five plants currently under construction will be producing power by 2019.

Siobhan O’Meara, a senior analyst at Nuclear Energy Insider, is one of the organisers of an annual “nuclear construction summit”, the sixth of which is taking place in Charlotte, North Carolina, in October.

She said: “With nuclear new build taking off once again across the globe, it’s never been more critical to finance, plan and deliver your construction programmes on time and budget.”

Time will tell who is right. – Climate News Network

Waste problems still haunt nuclear option

Closing shot: the nuclear popwer plant at San Onofre, California Image: D Ramey Logan/WPPilot via Wikimedia Commons
Closing shot: the nuclear power plant at San Onofre, California
Image: D Ramey Logan/WPPilot via Wikimedia Commons

By Paul Brown

Nuclear power is seen as one of the possible solutions to climate change, but the recent closure of five US power stations is forcing the industry to face up at last to the damaging legacy of how to deal with radioactive waste.

LONDON, 15 July, 2014 − Long-term employment is hard to find these days, but one career that can be guaranteed to last a lifetime is dealing with nuclear waste.

The problem and how to solve it is becoming critical. Dozens of nuclear power stations in the US, Russia, Japan, and across Europe and Central Asia are nearing the end of their lives.

And when these stations close, the spent fuel has to be taken out, safely stored or disposed of, and then the pressure vessels and the mountains of concrete that make up the reactors have to be dismantled. This can take between 30 and 100 years, depending on the policies adopted.

In the rush to build stations in the last century, little thought was given to how to take them apart 40 years later. It was an age of optimism that science would always find a solution when one was needed, but the reality is that little effort was put into dealing with the waste problem. It is now coming back to haunt the industry.

Profitable business

Not that everyone sees it as a problem. A lot of companies view nuclear waste as a welcome and highly profitable business opportunity.

Either way, because of the dangers of radioactivity, it is not a problem that can be ignored. The sums of money that governments will have to find to deal with keeping the old stations safe are eye-wateringly large. They will run into many billions of dollars − an assured income for companies in the nuclear waste business, stretching to the end of this century and beyond.

The US is a prime example of a country where the nuclear waste issue is becoming rapidly more urgent.

The problem has been brought to the fore in the US because five stations have closed in the last two years. The Crystal River plant in Florida and San Onofre 1 and 2 in California have closed down because they were judged too costly to bring up to modern standards. Two more − Kewaunee in Wisconsin andthe  Vermont Yankee plant − could no longer compete on cost with the current price of natural gas and increased subsidies for renewables.

Nuclear Energy Insider, which keeps a forensic watch on the industry, predicts that several other nuclear power stations in the US will also succumb to premature closure because they can no longer compete.

The dilemma for the industry is that the US government has not solved the problem of what to do with the spent fuel and the highly radioactive nuclear waste that these stations have generated over the last 40 years. They have collected a levy − kept in a separate fund that now amounts to $31 billion − to pay for solving the problem, but still have not come up with a plan.

Legal action

Since it costs an estimated $10 million dollars a year to keep spent fuel safe at closed stations, electricity utilities saddled with these losses, and without any form of income, are taking legal action against the government.

The US government has voted another $205 million to continue exploring the idea of sending the waste to the remote Yucca Mountain in Nevada − an idea fought over since 1987 and still no nearer solution. Even if this plan went through, the facility would not be built and accepting waste until 2048.

The big problem for the US, the utility companies and the consumers who will ultimately pay the bill is what to do in the meantime with the old stations, the spent fuel, and the sites. Much of the fuel will be moved from wet storage to easier-to-manage dry storage, but it will still be a costly process. What happens after that, and who will pay for it, is anyone’s guess.

The industry is having a Nuclear Decommissioning and Used Fuel Strategy Summit in October in Charlotte, North Carolina, to try to sort out some of these issues.

But America is not alone. The UK has already closed a dozen reactors. Most of the rest are due to be retired by 2024, but it is likely that the French company EDF, which owns the plants, will try to keep them open longer.

The bill for dealing with existing nuclear waste in Britain is constantly rising and currently stands at £74 billion, even without any other reactors being decommissioned.

The government is already spending £2 billion each year trying to clear up the legacy of past nuclear activities, but has as yet found no solution to dealing with the thousands of fuel rods still in permanent store at power stations.

As with the US, even if a solution is found, it would be at least 2050 before a facility to deal with this highly dangerous waste could be found. By that time, billions of pounds will have been expended just to keep the used fuel from igniting and causing a nuclear meltdown.

It is hard to know how the industry’s finances could stand such a drain on its resources without going bankrupt.

Similar problems are faced by Germany, which is already closing its industry permanently in favour of renewables, and France, with more than 50 ageing reactors.

Japan, still dealing with the aftermath of the Fukushima accident in 2011, is composed of crowded islands where few people will welcome a nuclear waste depository.

Many countries in the former Soviet bloc with ageing reactors look to Russia − which provided them − to solve their problems. But this may be a false hope, as Russia has an enormous unsolved waste problem of its own.

Dramatic rise

In all these countries, the issue of nuclear waste and what to do with it is a problem that has been put off − both by the industry and politicians − as an issue to be dealt with sometime in the future. But the problem is becoming more urgent as the costs and the volume of waste rises dramatically.

Unlike any other form of generation, even dirty coal plants, getting rid of nuclear stations is no simple matter. To cleanse a nuclear site so that it can be used for another industrial use is difficult. Radioactivity lasts for centuries, and all contamination has to be physically removed.

For many critics of the industry, the nuclear waste issue has always been a moral issue − as well as a financial one − that should not be left to future generations to solve. The industry itself has always relied on its continuous expansion, and developing science, to deal what it calls “back end costs” at some time in the distant future.

But as more stations close, and fewer new ones are planned to raise revenue, putting off the problem no longer seems an option, either for the industry or for the governments that ultimately will have to pick up the bill. – Climate News Network

Europe faces deadly cost for climate inaction

Smoke from Russian forest fires obscures the Sun in 2010 Image: Ximonic, Simo Räsänen via Wikimedia Commons

Smoke from Russian forest fires obscures the Sun in 2010
Image: Ximonic, Simo Räsänen via Wikimedia Commons

By Tim Radford

A failure to act to reduce the impacts of climate change could cost Europe dear in lives lost and economic damage, according to a European Commission study.

LONDON, 13 July 2014 − Inaction over climate change costs lives. And in the case of European inaction, it is estimated that this could one day cost 200,000 lives a year.

That is the warning in a new European Commission (EC) study, which also says that failing to take the necessary action could burn 8,000 square kilometres of forest, and commit European taxpayers to at least €190 billion (US$259 bn) a year in economic losses.

Flood damage, too, could exceed €10bn a year by 2080, while the number of people affected by droughts could increase sevenfold, and coastal damage from sea level rise could treble.

The study weighs the bleak consequences of inaction. Scientists considered what would happen if the politicians and players on the continent worked with international partners to constrain global warming to a 2°C rise, or alternatively took no action and allowed global temperatures to soar to 3.5°C. They analysed the impact of climate change in agriculture, river floods, coasts, tourism, energy, droughts, forest fires, transport infrastructure and human health.

All involved in the research emphasised that their projections were conservative – that is, they were underestimates – and imagined a planet 60 years from now that was occupied by its present population, at its present state of economic growth. In a more populated, more developed world, the losses would be hugely greater.

Probable underestimates

The biggest and most obvious cost was to human health: premature death – from heat stress or other climate-related impacts – would account for €120 billion; coastal losses would claim €42 billion and agriculture €18bn. The worst-hit regions would be southern and south central Europe, which would bear 70% of the burden; northern Europe would experience the lowest.

If the world keeps temperature rise to the current international target of 2°C, there will still be huge costs, but the constraint would knock at least €60 billion off the overall bill. It would save lives too,  reducing the notional premature death toll by 23,000, and would burn only about 4,000 square kilometres of forest.

Calculations such as these − which are aids to political and economic planners, and intended to spur forthcoming political action − are uncheckable, but they are also almost certainly underestimates. They take no account of losses of, for example, biodiversity, on which it is impossible to place a value, and they do not include the consequences of catastrophic tipping points, such as the melting of Arctic ice.

Connie Hedegaard, the EC’s Commissioner for Climate Action, said: “No action is clearly the most expensive solution of all. Why pay for the damages when we can invest in reducing our climate impacts and becoming a competitive low-carbon economy?

“Taking action and taking a decision on the 2030 climate and energy framework  in October will bring us just there, and make Europe ready for the fight against climate change.” – Climate News Network