Thursday, December 21, 2017

GWPF Newsletter: EU Energy Ministers Back Coal & Wood Burning

Europe’s Great ‘Green’ Energy Swindle Exposed

In this newsletter:

1) Europe’s Great ‘Green’ Energy Swindle Exposed
Fred Pearce, Yale Environment 360, 19 December 2017 
2) EU Ministers Back Govt Subsidies For Coal-Fired Power Plants Until 2030
Platts, 19 December 2017

3) Poland Opens Europe's Largest Coal Power Unit
AFP, 20 December 2017 
4) Francis Menton: U.S. Regains The Ability To Identify Real National Security Threats
Manhattan Contrarian, 19 December 2017 
5) John Constable: BP’s New Solar Venture
GWPF Energy, 18 December 2017

Full details:

1) Europe’s Great ‘Green’ Energy Swindle Exposed
Fred Pearce, Yale Environment 360, 19 December 2017 

Most of Europe new “green” power has actually come from burning wood in converted coal power stations. The forests of North Carolina, Louisiana, and Mississippi — as well as those in Europe — are being destroyed to sustain a European fantasy about renewable energy.

A loophole in carbon-accounting rules is spurring a boom in burning wood pellets in European power plants. The result has been a surge in logging, particularly in the U.S. South, and new doubts about whether Europe can meet its commitments under the Paris accord.

It was once one of Europe’s largest coal-burning power stations. Now, after replacing coal in its boilers with wood pellets shipped from the U.S. South, the Drax Power Station in Britain claims to be the largest carbon-saving project in Europe. About 23 million tons of carbon dioxide goes up its stacks each year. But because new trees will be planted in the cut forests, the company says the Drax plant is carbon-neutral.

There is one problem. Ecologists say that the claims of carbon neutrality, which are accepted by the European Union and the British government, do not stand up to scrutiny. The forests of North Carolina, Louisiana, and Mississippi — as well as those in Europe — are being destroyed to sustain a European fantasy about renewable energy. And with many power plants in Europe and elsewhere starting to replace coal with wood, the question of who is right is becoming ever more important.

Since 2009, the 28 nations of the European Union have embarked on a dramatic switch to generating power from renewable energy. While most of the good-news headlines have been about the rise of wind and solar, most of the new “green” power has actually come from burning wood in converted coal power stations.

Wood burning is booming from Britain to Romania. Much of the timber is sourced locally, which is raising serious concerns among European environmentalists about whether every tree cut down for burning is truly replaced by a new one. But Drax’s giant wood-burning boilers are fueled almost entirely by 6.5 million tons of wood pellets shipped annually across the Atlantic.

In September, some 200 scientists wrote to the EU insisting that “bioenergy [from forest biomass] is not carbon-neutral” and calling for tighter rules to protect forests and their carbon. Yet just a month later, EU ministers rubber-stamped the existing carbon accounting rules, reaffirming that the burning of wood pellets is renewable energy.

Under the terms of both the UN Paris climate agreement and Europe’s internal rules, carbon losses from forests supplying power stations should be declared as changes to the carbon storage capacity of forest landscapes. But such changes are seldom reported in national inventories. And there is no system either within the EU or at the UN for reporting actual changes in carbon stocks on land, so the carbon is not accounted for at either end — when trees are cut, or when the wood is burned.

Wood burning is turning into a major loophole in controlling carbon emissions. The U.S. could be the next country to take advantage. A federal spending bill that passed the House of Representatives earlier this year directed the Environmental Protection Agency to establish policies “that reflect the carbon neutrality of biomass” and to “encourage private investment throughout the forest biomass supply chain,” paving the way for a boom in American pellet burning.  […]

Burning wood may be close to carbon neutral in some situations, such as where it is clear that cut trees are replaced with the same trees, one for one; but in others it can emit even more carbon than coal. The trouble is that regulators are ill-placed to tell the difference, which will only be clear decades after the presumed emissions have been tallied — or not — in national carbon inventories.

The one certainty is that if things do not go according to plan, Europe’s promises for meeting its Paris climate commitments will go up in smoke. And the U.S.’s own CO2 emissions could resume their upward path (sic) even quicker than President Donald Trump intends.

Europe’s forests have for centuries been cut for household fuel and, in the past century, for local heating plants. But what is happening now is on a very different scale. The change has been fueled by new technology that converts timber into wood pellets that have been heated to remove moisture and compressed, which makes long-distance transportation practical and economic.

Roughly half the cut wood in the EU is now being burned to generate electricity or for heating. And there is growing evidence that the logging is damaging forests and reducing their ability to store carbon.

Full post

see also GWPF coverage of Europe’s biomass-burning fiasco
2) EU Ministers Back Govt Subsidies For Coal-Fired Power Plants Until 2030
Platts, 19 December 2017

Brussels (Platts)-- EU coal-fired power plants could benefit from capacity payments through 2030 if a negotiating position agreed by EU energy ministers on a draft EU electricity market design regulation makes it into the final binding version.

The position, agreed at an EU energy council meeting in Brussels, would allow existing power plants with emissions either above 550 g carbon dioxide/kWh or 700 kg CO2 on average per year per installed kW to receive capacity payments through 2030.

These payments would have to start decreasing though after 2025.

New power plants with emissions above these limits -- i.e. all unabated coal plants -- would not be allowed to take part in capacity mechanisms from 2025.

These timings are around seven years later than the European Commission's original proposal from November 2016, which sought to exclude new plants above the 550g CO2/kWh emission limit from capacity mechanisms from around late 2018 and existing plants from around late 2023.

Full post 

3) Poland Opens Europe's Largest Coal Power Unit
AFP, 20 December 2017 

Warsaw: Polish state-controlled energy company Enea on Tuesday inaugurated Europe's largest coal-fired power unit, at a time when other nations want to shift away from greenhouse gas-emitting fossil fuels.

Enea opened a 1,075 MW capacity unit built by Japan's Mitsubishi Hitachi Power Systems at its Kozienice plant to join a dozen other units in the 250-300 MW range at the site.

"The B11 section is the largest and most modern in Europe," said the firm's head of production Krzysztof Figat during a ceremony carried live over the internet to mark the 1.5 billion euro ($1.8 billion) project.

Total capacity at the plant, which uses some three million tons of coal annually, mainly from the Bogdanka mine in southern Poland, is now nearly 4,000 MW.

As well as the major plant at Kozienice, Poland is home to Europe's largest plant at Belchatow near the city of Lodz, one of the largest coal-fired plants in the world.

Coal remains a sector of primary importance in Poland, employing some 100,000 people.

Coal and lignite account for around 90 percent of Polish energy production.

"The new unit will increase energy security of Poland and the Polish people, which is an economic and political priority for our country," said new Prime Minister Mateusz Morawiecki.

Warsaw has recently slowed development of wind power and is still to decide on whether or not to build a first nuclear plant in a country suffering some of the worst air pollution in Europe.

4) Francis Menton: U.S. Regains The Ability To Identify Real National Security Threats
Manhattan Contrarian, 19 December 2017 

Maybe Donald Trump is just not your type of guy, and certainly not the guy you would want to be President; but keep in mind who was the alternative.

Before these things fade into the memory hole, bring back to mind a few of the wildly incompetent policies of the previous administration. Looking around today for a candidate as the policy of the previous administration that could be the very most wildly incompetent of all, with a very real potential to put the security of the country in serious jeopardy, my leading contender is the decision to declare “climate change” to be a top-priority national security risk.

Do you remember Obama doing that?  It wasn’t that long ago. In his second inaugural address in January 2013, Obama declared that “no challenge – no challenge – poses a greater threat to future generations than climate change.” Then, over the next couple of years, he ramped up the claimed “challenge” of climate change from mere “greatest threat to future generations” to an “immediate threat to national security.” 

Think about that for a minute — how would it even work?  Suppose the temperature goes up a few degrees over the next few decades. Does it mean that we don’t have an army any more? Does it mean that our weapons won’t work? Nevertheless, in a National Security Strategy document in February 2015, the Obama administration declared climate change to be “an urgent and growing threat to our national security,”  Then in May 2015, Obama gave a commencement address at the Coast Guard Academy in Connecticut.


I am here today to say that climate change constitutes a serious threat to global security, an immediate risk to our national security, and, make no mistake, it will impact how our military defends our country.  And so we need to act, and we need to act now.

Supposedly, something like sea level, or maybe wildfires, or maybe floods — all completely speculative — would somehow make the country harder to defend. Meanwhile, when Obama talked about “acting now,” what he meant was restricting production fossil fuels in the United States.

What did he think was the fuel that powers the planes and ships and missiles, let alone powering the economy that provides all the logistical support to keep the military functioning? As far as I could tell, he had no idea.  In the name of “national security” he would hobble and ultimately shut down our own oil and coal and gas industries, leaving us to go begging for the necessary fuel to — where?  OPEC?  Russia? Venezuela? You really need to be delusional not to be able to distinguish the real national security threat here from the imaginary one.

As you probably know, in a new National Security Strategy document released yesterday President Trump reversed this ridiculous policy of President Obama.

The new document does not contain any section explicitly dealing with “climate,” but it does have a section titled “Embrace Energy Dominance.”  Key quote:

Access to domestic sources of clean, affordable, and reliable energy underpins a prosperous, secure, and powerful America for decades to come.  Unleashing these abundant energy resources—coal, natural gas, petroleum, renewables, and nuclear—stimulates the economy and builds a foundation for future growth. Our Nation must take advantage of our wealth in domestic resources and energy efficiency to promote competitiveness across our industries. . . .  

Climate policies will continue to shape the global energy system. U.S. leadership is indispensable to countering an anti-growth energy agenda that is detrimental to U.S. economic and energy secu- rity interests. Given future global energy demand, much of the developing world will require fossil fuels, as well as other forms of energy, to power their economies and lift their people out of poverty.  The United States will continue to advance an approach that balances energy security, economic development, and environmental protection.

Bullet dodged, at least for the moment.

Now, perhaps on reading this, you remain skeptical that hobbling U.S. fossil fuel energy production could jeopardize national security by making the U.S. dependent on the likes of OPEC or Russia for fuel needed to run the military or the economy. If so, I would urge you to pay attention to what has just been occurring in the UK.  The UK is thought to have substantial natural gas-bearing shale formations (full extent unknown due to lack of exploration) that could be tapped to supply fuel for the country.  However, during the whole time of the shale gas revolution in the United States, the process of horizontal drilling and “fracking” for gas has been essentially shut down by regulators over concerns of environmentalists.  The first exploratory well after the moratorium finally got going just this August.  From the Financial Times, August 17:

Drilling has started on the first UK shale well for six years even as debate intensifies among geologists over how much gas is available for fracking. Cuadrilla, the company leading the push to bring US-style shale gas production to the UK, said on Thursday it had begun drilling a vertical well expected to reach 3.5km beneath its site near Blackpool, Lancashire... 

Fracking has been on hold in the UK since 2011 when two small earth tremors were blamed on exploratory operations by Cuadrilla at another site near Blackpool. Cuadrilla was given the go-ahead by the government last year to resume drilling, reflecting ministers’ hopes of replicating the shale revolution that has cut US gas prices and bolstered American energy security.

Lacking a home-grown, land-based gas supply from fracking, the UK has been relying on gas from the aging North Sea fields, as well as gas that comes from the Middle East and also Norway via pipelines across Europe.  Both of those sources then suddenly experienced supply disruptions in the past couple of weeks.  From the Telegraph, December 13:

Around 40pc of the UK’s domestic [natural gas] supplies have been wiped out until the new year due to the emergency shutdown of the North Sea’s Forties pipeline, operated by Ineos. Supply from Europe has also been constrained by the explosion at a hub in Austria and technical problems in the Norwegian North Sea.    

Time to crank up the vast reserves of solar panels?  No, dummy, those don’t work in the winter.  Wind turbines also have zero ability to step up in an emergency.

Full post

5) John Constable: BP’s New Solar Venture
GWPF Energy, 18 December 2017
Dr John Constable: GWPF Energy Editor

BP’s return to the solar sector, as a developer of solar power stations, rather than a manufacturer of panels, is further evidence that the renewable sector, even at its most potentially interesting, is less a technology business and more the securing of entitlements to land development rights, grid connection, market infeed and supported or guaranteed income. Bluntly, it is rent-seeking.

It is now almost six years to the day since BP Solar closed its panel manufacturing operations, in December 2011, and though it has since gradually built up a large Alternative Energy business, including 2.3 GW of wind power in the United States, it has scrupulously avoided flying anywhere near the sun, let alone close enough to be dangerous. But that appears to have changed this week with BP announcing that it would be buying a 43 per cent share in the solar developer and operator Lightsource, which will henceforth to be known as Lightsource BP.

BP will pay $50 million immediately on completion of the deal, and a further $150 million over the next three years. The joint announcements by the two companies tells us that “The great majority of this investment will fund Lightsource’s worldwide growth pipeline”, a pipeline that amounts to some 6 GW of capacity (to put that into scale, the UK currently has about 12 GW installed, and Japan well over 40 GW).

This prospective growth is about three times the 2GW capacity currently managed by Lightsource. Of this 2 GW it developed about 1.3 GW, about 290 of them in the UK, investing, the company tells us, some £2.5 billion since 2011.

$200 million for 43 per cent of such an apparently large business would appear to be good value, assuming that the assets are of fair quality, and this does seem to be a  productive portfolio by solar standards. The press release describes the 2 GW under management as supplying the equivalent half a million homes. Assuming about 4 MWh of electricity per household, this suggests a portfolio production of about 2 TWh per year, and a load factor of about 11%.

That would be towards the higher end of northern european productivity (the best of UK load factors are about this level), but lowish in comparison to, say, Japan, where load factors of around 20% are currently achieved. It will be interesting to see how the 6 GW to be built with BP’s investment shapes up, which will depend on the choice, the design, the quality of equipment, and the management of the schemes.

One thing that is quite certain is that BP will not be making the panels themselves. By acquiring Lightsource, BP is, in the words, of Bob Dudley, the group CEO, “coming back to solar, but in a new and very different way”. This is emphatically not manufacturing. Lightsource is, as the company itself says, a “solar development company, focused on the acquisition, development and long term management of large-scale solar projects.”

The importance of this change should not be underplayed, since it reveals much about the fundamental character of the renewables sector in general. In a quotation supplied to the The Times, Dev Sanyal, BP’s chief executive for Alternative Energy, expands on Bob Dudley’s remarks in a very revealing way: “We don’t regret divesting of solar manufacturing. […] We were in the wrong part of the value chain.”

If Big Oil, in the corporate person of BP, turns its nose up at the manufacture of solar generation equipment as “the wrong part of the value chain”, this suggests that the sector, like much else in renewable energy, is not in its fundamentals a technology business. Quite otherwise, it is a matter of obtaining contractual entitlements, land use permits, grid connections, feed-in tariffs, production tax credits, and other state backed contracts giving support. Less charitably, we might simply call these things state-backed rents, and the business of securing them rent-seeking.

Doubtless that is the right part of the value chain for BP’s shareholders, but from the public’s point of view this truth must be regarded as particularly disappointing in connection with solar, which is the only large scale option for the generation of renewable electricity that is sufficiently new to be a strong candidate for technological invention and innovation. While the photovoltaic effect was first observed in the mid-nineteenth century, practical solar cells did not appear until a hundred years later, in the 1950s. Wind, hydro, and biomass in its various forms, all have much deeper histories and are fully established established.

It would be churlish for even the most hardened critic of renewables to deny that by comparison solar has real technological interest. However, as the BP/Lightsource deals shows, that potential is simply not what stimulates major investment in the sector; it’s the wrong part of the value chain. This can’t be what the governments designing the world’s incentive schemes expected, but it is unfortunately what they have created. Deployment has been rewarded in advance of technological adequacy, and sensible companies such as BP do what the policies reward.

The London-based Global Warming Policy Forum is a world leading think tank on global warming policy issues. The GWPF newsletter is prepared by Director Dr Benny Peiser - for more information, please visit the website at

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