Copenhagen Failure Brings Down Carbon Prices on EU Cap and Trade Market
The failure of the Copenhagen Climate Change Conference to produce a comprehensive agreement has indirectly led to a sharp decline in the price of carbon emissions permits in the European Union’s cap and trade system.(image: treehugger.com)
While most commentators have agreed that the climate talks at Copenhagen last December were a disappointment, there is now evidence suggesting that the failure of world leaders to reach a binding pact will have real-world financial repercussions, at least in Europe. According to an article published by BusinessWeek on Tuesday, the price of carbon emissions permits is falling in the EU’s cap and trade system, mainly because the unsuccessful Copenhagen conference did little to enforce current pollution regulations and even less to provide polluters with incentives to invest in clean energy. Put in a more alarming way: the longer pollution goes unchecked, the cheaper it becomes to emit greenhouse gasses.
This unhappy paradox is evidenced by the recent devaluation of carbon permits in Europe; the price of permits, each of which allows businesses and factories to emit one ton of carbon dioxide, have sunk 9 percent in London since mid-December, when talks in the Danish capital failed to produce a successor to the Kyoto Protocol, which expires in 2012. Europe’s current cap and trade system, started in 2005 as an outgrowth of the Kyoto accord, is the region’s primary method of cutting emissions; the EU carbon market, the largest in the world, covers about 11,000 companies, from energy producers to manufacturers.
Heating Oil Weekly Roundup: List of Year-End Lists
(image: damonclifford.com)
As the year closes, everyone is taking a look back, so this week’s roundup gives you the best of the “best of” stories.
At MIT Technology Review, Kevin Bullis offers up the top energy stories of the year. Some of the choices were expected—the rush for natural gas in the Marcellus Shale, carbon capture, and biofuel—but hamsters? Follow the links for a video demonstrating hamster power.
Energy analyst Robert Rapier compiled his top-ten list of energy stories this year, which you can find at The Oil Drum or his R-Squared Energy Blog. His choice for top story seems hard to argue with: volatility in the oil markets.
BusinessGreen.com’s James Murray crunched some numbers and found the most popular stories on the site from the past year. You’ll find green investment, solar panels, and lots about hybrid cars.
The Philadelphia Inquirer doesn’t stop at stories of the year—they take a look at the top science stories of the whole decade. The genome, stem cells, and pandemic flu all make the cut, as does one story with more relevance to this site: alternative energy. From peak oil to a post-petroleum world, from natural gas to electric cars, Sandy Bauer covers the highlights.
Ben Jervey at GOOD looks beyond 2009 as well to cover the top environmental news of the last ten years. Follow him as he goes in chronological order, when green became the new black, Al Gore became inconvenient, and Copenhagen was kind of a flop.
Are Cuts in Methane (Not Carbon) Emissions the Solution to Global Warming?
Natural gas emits less carbon dioxide than other fossil fuels, but is itself a greenhouse gas. (image: knowledge.allianz.com)
In an opinion piece in the Wall Street Journal, two scientists say that even the most ambitious proposals made at Copenhagen to reduce carbon emissions won’t reverse global warming. So what would they have us do? According to Robert Watson, former chair of the IPCC (Intergovernmental Panel on Climate Change), and Mohamed El-Ashry, senior fellow at the United Nations Foundation, “the most obvious strategy is to make an all-out effort to reduce emissions of methane.”
Methane accounts for 75 percent as much warming as carbon dioxide, say Watson and El-Ashry, but has not received nearly as much attention in any climate protection measures. That’s because methane has a shorter lifespan than carbon dioxide—when released into the atmosphere it lasts decades, while carbon dioxide can persist for hundreds of years. The Kyoto Protocol made methane one of the six gases it targeted, but calculated its effect over the same period of time as carbon dioxide. That distorts methane’s relatively brief but nonetheless powerful impact.
Thomas Friedman Weighs in on Copenhagen, Wants to See Green Revolution in US
NYT writer Thomas Friedman. (image: treehugger.com)
New York Times columnist and author Thomas Friedman said on Tuesday’s edition of MSNBC’s Rachel Maddow Show that the UN’s climate change conference in Copenhagen was an “unprecedented breakdown” as opposed to an “unprecedented breakthrough” (video below). After all, the end result of the much discussed summit was a non-binding resolution that may not have any impact on carbon emissions, as HeatingOil.com reported on Monday.
But all is not lost, he says; if the United States creates its own climate change policy, and one that successfully launches a “green economy,” the rest of the world will follow suit and will look towards America for leadership. But it will be tough, as nations like China, India and Brazil are gaining in worldwide influence and becoming stronger competitors with the US by the day.
Final Analysis on Copenhagen: Few Clear Gains, but Some Hope for the Future
(image: seattlepi.com)
In the wake of the largely-seen-as-failed climate talks in Copenhagen this month, news outlets, analysts, and politicians alike are trying to wrap their heads around what happened in Denmark. Most agree that the talks were a failure, many blaming the process itself. After all, getting 193 countries, all with their own challenges and interests, to agree on anything is a tall order.
Bloomberg columnist Eric Pooley takes it a step further. He points out that all parties going in to this conference knew it wasn’t going to produce a strong agreement, and that fact hinged on one country alone: the United States. Without a firm commitment from the U.S. Senate concerning emissions reduction, few others were willing to lay their cards on the table, and talks suffered because of it. George Monbiot of the U.K. Guardian said as much, perhaps in a more blunt fashion, in his commentary entitled “If you want to know who’s to blame for Copenhagen, look to the U.S. Senate.”
Final Product of Copenhagen Conference is Informal, Non-Binding Agreement
UN Secretary General Ban Ki Moon at the Copenhagen conference. (image: deccanherald.com)
After a long two weeks in Copenhagen, an uneasy accord was reached early Saturday morning, after the official end of the conference. According to the New York Times, the final agreement came in the way of a 12-paragraph statement of intent, not the legally binding pledge many hoped to walk away with. Almost every country was said to have approved the final agreement, even though it was largely seen as a flawed compromise that left many bitterly disappointed.
Among the details missing from the accord were firm targets for emissions reductions and any kind of deadline for enacting a binding treaty. President Obama himself said the accord was only a “modest step” towards real progress. The deal does call for major emitters to curb greenhouse gases and help developing nations with much-needed aid. However, since it is non-binding, there is no telling how effective the pledge will be.
The process of tackling global warming using the U.N. Framework Convention on Climate Change, recently seen to be the best way of handling the problem, seems to be falling apart. As seen in Copenhagen, it is increasingly difficult to reach a global consensus when so much bad blood and hostility exists between rich and poor nations. As the world moves forward, it may be time to try a new tactic.
For much of the world, the outcome of the Copenhagen talks was disappointing. However, if and when a deal is reached in the future, it will largely be due to the hard work that was done in Denmark. Here’s hoping next time is more fruitful.
Heating Oil Weekly Roundup: Presidential Loopholes, Christmas in Copenhagen, and Green Tech in China
(image: Nick Anderson of the Houston Chronicle, via americanprogress.org)
Looks like the Copenhagen conference was kind of a bust, but what likelihood was there that the US could pass any international treaty, anyway? If President Obama can’t get 60 votes for any legislation, how could he get the 67 needed for a treaty? He might not have to, says <a href=”>Michael Livermore at the Vine, a blog of The New Republic. Livermore details some of the ways that Obama could use executive authority to bring the US into a binding international agreement. It might not come up after Copenhagen, but another set of talks is scheduled for Mexico City.
Christmas in Copenhagen might mean shopping for gifts at stores that keep their doors open, pumping heat out onto the cold street, but it also means a Christmas tree that’s green in more ways than one, says Spencer Schwartz at the Wall Street Journal’s Environmental Capital blog. At City Hall Square, a massive Christmas tree stays lit through the power of volunteers on bikes that generate electricity for the lights. At night, when the volunteers go home, wind power keeps the tree bright.
Denmark seems a likely place for environmentally friendly innovation. What about China? In the New Yorker, Evan Osnos details China’s 863 Program, the clean-technology program that could progress by such bounds that the US would not even be competitive in the clean-tech sector. And this from a country whose capital, Beijing, often has air quality that the US typically associates with forest fires.
Natural gas drilling has come under criticism recently for the pollution it can cause in air and water, and in response the industry has taken steps to curb emissions and remove toxins from its drilling. But according to Abrahm Lustgarten at ProPublica—which has extensively and often critically covered problems associated with hydrofracking—these practices are still underused in natural gas drilling. According to Lustgarten, this doesn’t do much good for gas companies or local communities, since many of these steps not only cut pollution but boost productivity and save money.
This Week in Heating Oil: December 18
The second week of the UN climate conference in Copenhagen has wound down, and there’s not a lot to get excited about. Disorganization, conflict, and mistrust marred the conference from beginning to end. President Obama’s speech to the conference today failed to bring about any last-minute breakthroughs, and although some sort of eleventh-hour deal could come out of Copenhagen tonight or even tomorrow, it doesn’t appear very likely. For more details on what happened there over the last two weeks, take a look at Kristy Kershaw’s daily reports on the happenings in Denmark.
President Obama’s “Cash for Caulkers” program will not be implemented any time soon, if at all–last Friday, the House of Representatives passed a jobs-creation legislation that did not include Cash for Caulkers or any similar program. Hopefully, the program will get the support it needs some day, but it looks like that day is at least months away.
Some progress was made this week–also last Friday, the US House passed the Wall Street Reform and Consumer Protection Act of 2009, which included limitations on how commodities contracts, including crude oil and heating oil, could be traded. The intended effect of the provisions is a reduction of oil price volatility to make budgeting easier on businesses and individuals who rely on heating oil and other energy products.
Copenhagen Day 12: President Obama’s Speech Leaves Many Disappointed
Copenhagen ends with a bust, with or without the U.S. President's closing speech. (image: washingtonpost.com and nazret.com)
In what could be the final nail in the coffin of the erratic Copenhagen negotiations, President Obama took the stage Friday, saying he was convinced the world could still act “boldly and decisively” on climate change, but offering little in the way of solid examples. The president proposed no further financial commitments of support beyond the $100 billion Hillary Clinton announced yesterday, nor any additional commitments on emissions reductions. He did say America would live up to its pledges to the international community, and hoped the world could walk away with at least something, anything, on paper.
As the Huffington Post pointed out, Obama’s speech was full of open frustration. “I think our ability to take collective action is in doubt,” he said. Even on this last day, the talks are in a state of disarray, with wide chasms still remaining between rich and poor nations, as well as China and the United States. Obama made it clear that the United States’ participation in any deal would be contingent upon accountability and transparency from other nations, specifically China. “Without such accountability, any agreement would be empty words on a page,” Obama said. And without such mechanisms in place, any pact “would be a hollow victory.” Read the full text of Obama’s speech here.
Copenhagen Day 11: U.S. Makes Financing Pledge for Poor Nations, China Responds Favorably, Some Hope in the Talks Restored
Secretary of State Clinton made a huge financial commitment on the behalf of the US that helped moved stalled talks forward in Copenhagen today. (image: blog.nature.org)
Finally, some progress! With just over a day left in the Copenhagen climate talks, some momentum gathered Thursday, as the United States announced an aid package to help poor nations combat climate change. According to the New York Times, Secretary of State Hillary Rodham Clinton said the U.S. would help raise $100 billion a year by 2020, the first real financing commitment to come from the Obama administration.
While Clinton reiterated America’s stance that any such package would be contingent on assurances of transparency from China, the Asian nation responded with a surprising shift in posture. Not only did it signal that developing nations would move to limit their emissions, but also warmed to the idea of outside verification. Chinese Vice Foreign Minister He Yafei told reporters that his country was open to “dialogue and cooperation that is not intrusive, that does not infringe on China’s sovereignty.” As China has been vehemently opposed to international transparency requirements through the whole of the Copenhagen conference, this is definitely progress.
From Copenhagen: Sea Levels Could Rise Up to 29 Feet Over the Next Few Hundred Years
(image: dailymail.co.uk)
A new study emerged out of Copenhagen on Wednesday, claiming that global sea levels could rise by up to 9 meters (roughly 30 feet) in the next few hundred years, even if the world manages to stave off a temperature raise above 2 degrees Celsius. This new estimate is higher than any other that has been predicted so far, and would mean low-lying coastal areas like New Orleans, areas of Southern Florida, Bangladesh, and most of the Netherlands would be severely affected.
Perhaps ironically, the head of the African group of nations proposed a deal today that would cut aid to poor countries by more than half of what has been discussed thus far. Meles Zenawi, the prime minister of Ethiopia, called for $50 billion a year by 2015 and $100 billion per year by 2020, saying that they have more to lose, and therefore must be flexible. The amount of aid due to poor nations has been the subject of intense debate in Copenhagen, with the European Union pledging several billion in the short term, and the United States having yet to pledge anything at all.
While the aid will undoubtedly help poor nations as they attempt to deal with climate change, if no deal is struck at Copenhagen, the news for rising seas levels is not good. Hopefully as more world leaders make their way to Copenhagen over the next few days, negotiations will un-stall and begin to make some real progress forward.
Copenhagen Day 10: Naomi Klein Talks Protests and Progress as a Deal Is Neared on Deforestation
Destruction of the world’s rainforests could be significantly cut back by an agreement that is close to being finalized in Copenhagen. (image: en.cop15.dk)
In an interview with the Huffington Post Tuesday, author and activist Naomi Klein talked about protests and progress, saying there is more at stake here then just getting any old deal on the books. She stressed that the messaging of NGOs to “seal the deal” in Copenhagen is the wrong one. “What’s on the table will NOT save the world,” she said. “We should not fight for just any deal, or at the cost of a deal that in the future would actually mean something.”
Klein went on to say that the United States has set the bar far too low in terms of goals and targets, and thinks the American delegation has “squandered a tremendous amount of goodwill.” See Klein talk to Grist.org about the planned protest that took place earlier today:
Copenhagen Day 9: Negotiations Move Slowly, China Refuses International Emissions Monitoring, and Protests Turn Violent
Climate demonstrators in Copenhagen on Saturday. (image: boston.com)
As the ninth day of the Copenhagen climate talks draws to a close, time is running short, and delegates are feeling the pressure. As the New York Times reported Tuesday, there is still a huge rift between rich and poor nations, who are no closer than last week to reaching a deal on emissions targets, financial aid for developing nations, or emissions measurement and monitoring. As Copenhagen prepares for the arrival of world leaders later this week, sentiment remains that the negotiations are moving too slowly.
China and the United States remain at an impasse after yesterday’s Chinese refusal to submit to international emissions monitoring. The United States insists that without monitoring and verification of what China is actually emitting, it will not enter into a deal with the developing nation. While China has committed to a reduction in carbon intensity, and has said it does not expect money from industrialized countries, it is remaining defiant on the issue of monitoring. The fallout of such a stalemate would likely mean Congress would not pass their own version of tough climate legislation, and could also lead to tariffs and restrictions on goods coming out of China.
Bipartisan Trio Working on New Senate Climate Bill
South Carolina Senator Lindsey Graham. (image: ingodisourtrust.wordpress.com)
The Washington Post reported that the senators who were attempting to draft a second bill to cap greenhouse gas emissions released a “framework” of the legislation on Thursday. However, the legislators offered few details about their ideas, and said that they were open to negotiation.
When UN Secretary General Ban Ki-moon met with a bipartisan group of senators at the US Capitol on Nov. 10, he urged the Senate to act on climate change before the UN climate change summit. Although Ban acknowledged that the Senate was unlikely to move that quickly, he urged the Senate to draft principles to establish pollution reduction goals, because such a framework would be a sign of commitment to reducing carbon emissions on the part of the US.
The nascent bill, authored by Sens. John Kerry (D-Mass.), Joseph Lieberman (I-Conn.), and Lindsey Graham (R-S.C.), is intended to send the message to delegates at the UN climate talks in Copenhagen that “the movement for climate change legislation in the United States Senate is alive and well,” Lieberman said at Thursday’s press conference announcing the framework.
Copenhagen Day 8: Obama’s Catch-22, Weekend Protests, and a U.S. Pledge For Clean Energy Technology
(image: telegraph.co.uk)
Week two of the Copenhagen Climate Summit began today, amidst reports of weekend protests, stalled negotiations, and a major player deciding to come two days early. There’s a lot to cover, but first, let’s take a look at some analysis that emerged over the weekend from the New York Times.
John M. Broder wrote on Saturday about the specific challenges President Obama faces as he makes his way to Copenhagen later this week. Although the House did pass a bill in June that includes Obama’s pledge to reduce emissions by 17 percent over the next decade, the Senate hasn’t even gotten around to debating the issue. And without Senate action, any promise Obama brings to the Copenhagen table is just that–a promise that may not be enough to persuade other nations to act.
Heating Oil Weekly Roundup: Copenhagen, Peak Sand, and the Indiana Bat
John Cole, the Scranton Times-Tribune via cagle.com. (image: cagle.com)
The Copenhagen Conference dominated energy news this week, shedding light on some of the peculiar habits of Denmark’s capital city. Even though the city is hosting a global climate conference, stores on the Stroget, one of Copenhagen’s most popular streets for window-shopping, leave their doors open to entice customers, reports Lars Kroldrup at the New York Times’ Green Inc. blog. Stores leave their doors open throughout the winter, freezing temperatures or no, letting heat and energy escape far more than any crack in the window.
Copenhagen’s mayor was worried that the city would set a bad example in a different way, and distributed postcards to 160 hotels in the city in an effort to curb prostitution, which is legal in Denmark, for the duration of the conference. Well, it backfired. As the Copenhagen Post reports, a sex workers interest organization in the city decided to offer free services to anyone who presented one of the anti-prostitution postcards.
Peak oil theory says that eventually even a country as rich in oil as Saudi Arabia will run out of the stuff, but even the most alarmist believer in peak oil might be surprised that Saudi Arabia is running out of sand. Stuart Burns at MetalMiner reports that Saudi Arabia has halted its sand exports, since it doesn’t have enough in places that would make it easy to export, which is in turn slowing down construction throughout the Middle East. Are we facing a future of “peak sand”?
It’s not just environmentalists who are eagerly hoping for cap and trade legislation—Goldman Sachs wants it, too. Bradford Plumer of the New Republic investigates the risks of creating a vast carbon market for huge financial institutions, but also why cap and trade, because it would bring in Wall Street geniuses, may be more successful at reducing emissions than the alternatives.
Construction of a wind farm in West Virginia has been halted, and it had nothing to do with big oil, corporate greed, or Americans’ attachment to their cars. It was stopped by the Indiana bat. As Maria Glod of the Washington Post reports, the Indiana bat is an endangered species and the wind energy project was mere miles away from limestone caverns that provide a home for many of them.
EU Cap and Trade Fraud Costs Governments $7.4 Billion
Europol’s investigation found extensive fraud in Europe’s carbon markets. (image: gouverner.net)
While debate about carbon emissions management rages at the UN’s Climate Change Conference in Copenhagen, the New York Times brings a cautionary tale into the proceedings regarding a major part of many nations’ carbon-reduction strategies: the system of cap and trade. The Green Inc. blog reports an announcement by Europol that cap and trade fraud has cost European governments $7.4 billion in lost tax revenues in the past year and a half. In light of these discoveries, a number of member nations, including the UK, the Netherlands, France, and Spain, have suspended the sale of permits, or altered their policies regarding how their value-added tax was assessed on permits.
In the US, several northeastern states have developed a cap and trade system, but the Obama administration and its Democratic supporters have faced fierce opposition to their plans to institute cap and trade nationwide. While there is plenty of time for the government to study the mistakes of Europe’s policies, fraud on this level does echo the warnings of many naysayers, such as the NGO Friends of the Earth, who only last month released a statement that concluded that the EU’s system posed significant financial risks.
Saudi Arabia Plans to Use Carbon Capture to Boost Oil Production
A Saudi Aramco pipeline under construction. (image: arabianoilandgas.com)
The latest country to jump on the carbon capture idea is Saudi Arabia. The oil-producing nation wants to capture carbon dioxide and inject it into the world’s largest oilfield by 2013 to attempt to increase output and reduce the country’s carbon footprint, reports the National.
Ali al Naimi, the Saudi minister of petroleum and mineral resources, made the proposal on Wednesday at a meeting of the Gulf Petrochemicals and Chemicals Association, which is similar to plans for carbon capture in Abu Dhabi. Yesterday’s announcement of the carbon capture project at the giant Ghawar oilfield was a key part of Saudi Arabia’s “initiatives on green.” The announcement came after the Saudi government was criticized by many global leaders for public skepticism that a global agreement could successfully cut emissions through reduced consumption of fossil fuels.
Copenhagen Day 4: Island Nations Reject 2ºC Temperature Rise, and the U.S. Pushes For Emissions Cuts From China, Other Developing Nations
The tiny island nation of Tuvalu. (image: travel.nationalgeographic.com)
Tensions continued between the rich and poor nations of the world today at day 4 of the Copenhagen Climate Summit. According to the U.K. Guardian, the Alliance of Small Island States (Aosis) formally rejected the proposed goal of limiting a global temperature rise to 2 degrees Celsius. The grouping of 43 of the smallest world nations, and those most vulnerable to the effects of climate change, said any rise more then 1.5 degrees Celsius is not acceptable coming out of these negotiations.
The group has the backing of 48 of the developed nations of the world, and includes Tuvalu, the nation that inspired a walkout at yesterday’s talks over their desire to come to a legally binding agreement with more ambitious targets for everyone.
The proposal to limit the rise in global average temperature to 1.5 degrees Celsius would require massive and near-immediate cuts in greenhouse gas emissions, as well as removal of CO2 already in the atmosphere. Technology for a large-scale removal of CO2 does not yet exist and according to the International Energy Agency, such cuts would require up to $10.5 trillion in investments in energy-related technology by 2030.
Copenhagen: Lessons From Kyoto
Kyoto, Japan, the site of the first-ever global meeting on the issue of climate change and precursor to the Copenhagen conference. (image: intellectualtakeout.org)
In a Wednesday piece in the U.K. Guardian, (probably the best news source around for the Copenhagen Summit) co-founders of the Copenhagen Climate Council Tim Flannery and Erik Rasmussen dissected the world of difference between Copenhagen and Kyoto. Back in 1997, the Kyoto Protocol was the first legally binding set of requirements for developed economies to reduce emissions by 2010. But the authors name three deficiencies right off the bat:
1. The reductions required in the agreement are now considered small by today’s scientific standards.
2. Rapidly developing nations have no limits placed on their emissions; the entire burden is placed on fully industrialized nations.
3. There is no real guidance for business on how to reduce emissions and remain profitable in the long term.
Beyond the agreement itself, there are marked differences in the science being presented at today’s conference, and, perhaps even more importantly, public opinion has greatly shifted. As the pair points out, Kyoto occurred before An Inconvenient Truth, Hurricane Katrina, and other drastic climate-based disasters. We now live in a world where the climate change agenda is front and center, both in the peoples’ minds and the politicians.
Although the recent controversy stemming from the illegally released emails by some leading scientists has re-ignited skepticism about man-made global warming (particularly in the US), the majority of the global community is aware of and concerned about the issue of climate change.
