Monday, July 12, 2021

GWPF Newsletter: Building Back Blacker


U.S. coal output rising most since 1990 as global demand surges

In this newsletter:

1) Coal output in U.S. rising most since 1990 as global demand surges
Bloomberg, 8 July 2021
2) Europe's Net Zero push stokes fears of a public backlash
Reuters, 9 July 2021 
3) Macron suffers another climate defeat
The Wall Street Journal, 7 July 2021
4) Biden's quest for cheap oil tests his climate credentials
E&E News, 7 July 2021
5) Surging U.S. LNG undermines Biden's climate agenda
E&E News, 8 July 2021
6) Biden’s new Cold War with China’s communist tyranny will result in climate collapse, radical activists claim
Global Warming Policy Forum, 8 July 2021  

7) OBR's report underestimates indirect costs of Net Zero transition
Gaia Fawkes, 9 July 2021 

8) Mistaken claims about malaria and global warming
GWPF Science, 9 July 2021

Full details:

1) Building Back Blacker: Coal output in U.S. rising most since 1990 as global demand surges
Bloomberg, 8 July 2021

The surging, post-pandemic U.S. economy is driving an unexpected boom in coal, the latest sign that demand for the dirtiest fossil fuel remains resilient.


American coal production this year will swell 15% to meet stronger demand for electricity at home and abroad, according to the U.S. Energy Department’s July outlook. That would be the most since at least 1990 and nearly double the 8% increase projected in May, when the economic rebound was still in earlier stages of recovery.

The shift underscores the vicious circle of climate change as more extreme temperatures drive power demand just as extensive drought cuts output from hydropower dams. That prompts utilities to burn more of the dirtiest fossil fuel, a pattern also exacerbated by high natural gas prices. At the same time, key exporters including  Australia and Colombia face supply problems that have helped lift global prices to a 10-year high and added to international demand for U.S. coal exports.

“Everything that could happen that’s positive from the demand standpoint is happening,” said Andrew Cosgrove, a mining analyst with Bloomberg Intelligence. “The stars are aligning.”
That growing appetite will help boost U.S. exports of the fuel by 21% this year, and another 19% in 2022, the Energy Department said Wednesday in its latest short-term outlook report. The department said its projections are based on forecasting firm IHS Markit’s projection that the world’s largest economy will grow by 7.4% in 2021.
The outlook also is driving up mining company share prices. Peabody Energy Corp., the biggest U.S. coal producer, and rival Arch Resources Inc. both hit 18-month highs this week. Consol Energy Inc. is trading near the highest since August 2019.

And the coal boom is unlikely to lose momentum anytime soon. As long as economic growth remains robust, so too will energy demand, according to Lucas Pipes, an analyst at B. Riley Securities.
Even though the fuel faces strong headwinds in the U.S. and Europe, where efforts to curb climate change are prompting utilities to close coal-fired power plants, global consumption is still increasing because of demand in Asia. And because suppliers aren’t opening new mines, prices are likely to remain high.
“I’m not seeing any changes in these trends,” said Pipes. “It bodes well for coal.”
2) Europe's Net Zero push stokes fears of a public backlash
Reuters, 9 July 2021

BRUSSELS/LONDON, July 9 (Reuters) - A European Union plan to extend carbon pricing to the fuel used in cars and to heat homes is facing a wall of early resistance from countries and lawmakers fearing a public pushback unless backers find ways to compensate those worst hit.

According to leaked drafts, the scheme would set up an Emissions Trading Scheme (ETS) for transport and heating, creating a market price for carbon – a price that fuel suppliers are likely to pass on to Europe's half a billion consumers in the form of higher bills. read more

Expected to be part of a package of proposals on July 14 aimed at ensuring the EU hits a target of cutting net emissions by 55% by 2030, it has been singled out by some capitals as something that could hurt the poorest in the 27-nation bloc.

Some even raise the prospect of it triggering "yellow vest" movements like the often violent protests that spread across France from late 2018 after an attempt to raise fuel taxes.

"This is a big risk for the willingness among the population to go forward with the transition," one EU official said, of the EU's goal to move towards a climate-neutral economy.

"We have to tread very carefully."

If they go ahead with it next week, European Commission policy-drafters promise to add social protections, including by channeling some revenues from the new ETS into a social fund to support the needy.

But critics question whether risking a political backlash is wise for something they say will only indirectly influence consumers' behaviour – especially when the EU is already planning tougher car CO2 standards and energy-saving requirements for buildings to curb emissions in those sectors.

"Taking such a political risk for a limited gain, I think it's not worth it," Pascal Canfin, a member of French President Emmanuel Macron's La Republique En Marche! movement and chair of the European Parliament's environment committee, told Reuters.

Canfin, who created a stir in June by declaring the plan "political suicide", described it as a de facto regressive tax and cited analysis by the Commission itself suggesting an ETS for road transport would cut emissions by barely 3%.

Any plan proposed by the Commission must be negotiated and eventually approved by the European Parliament and member states.


The EU’s existing carbon market has slashed emissions in the power sector and supporters say that success can be replicated elsewhere, to encourage consumers to make greener choices.

"A carbon price is the most efficient way to encourage businesses and households to cut emissions," said Elisabetta Cornago, research fellow at the Centre for European Reform in Brussels, adding that such policies should aim to redistribute any revenues generated to low-income households.

The economic, political and social backdrop to next week's announcement is certainly challenging.

A year-long market rally in crude oil on the back of hopes of global economic recovery has already pushed energy prices and inflation rates higher, while the pandemic has exacerbated existing wealth inequalities.

Surveys show a large majority of Europeans support the EU’s ambitious emissions-cutting goals. But even those who support tackling climate change are reluctant to pay for it directly.

A poll last month found that 75% of Germans rejected fuel price hikes as a way of addressing climate change.

Full story
3) Macron suffers another climate defeat
The Wall Street Journal, 7 July 2021

The French President’s green virtue signalling could cost him his job.

President Emmanuel Macron’s climate-change amendment to the French constitution effectively died this week. Its failure is the latest example in Western democracies of the disconnect between elites obsessed with climate change and the public.

Mr. Macron wanted a national referendum that would amend the constitution to “guarantee” environmental protection. This requires support from both houses of the French Parliament. The National Assembly, controlled by Mr. Macron’s party, approved the referendum this year.

The Senate announced Monday that it had voted to block the process. The upper body, with a conservative majority, worried that “guarantee” meant climate change would come before other constitutional imperatives. They feared, not unreasonably, that this would stifle innovation and business. While many in France cling to its statist past, there is still a constituency for economic dynamism.

This isn’t the first time Mr. Macron’s obsession with climate has wasted valuable time and political capital. Although the yellow-vest protests covered sundry domestic woes, they began as a response to a fuel-tax hike. The demonstrations led Mr. Macron to form the Citizens Convention for Climate, a body of 150 randomly selected French citizens. They came up with the climate amendment, which Mr. Macron wasted months fighting for.

The real shame is that Mr. Macron’s growth agenda would do more for the environment than punishing rural drivers or fiddling with the constitution. A more innovation-oriented French economy would produce companies and technology that solve environmental problems.

In 2017 Mr. Macron stared down unions when he liberalized French labor law. His later effort to reform the byzantine French pension system, which rewards politically connected workers and discourages mobility, was derailed by the pandemic. Many of the President’s allies oppose reviving the reform so close to an election next year. Yet Mr. Macron has a winning argument when framing the pension debate as a fight for equality and flexibility.

Mr. Macron, who hasn’t announced his reelection bid, hinted last year that he may take “tough steps” that make another run “impossible.” Whether those hard choices are for climate posturing or economic growth will go far to determine his legacy.
4) Biden's quest for cheap oil tests his climate credentials
E&E News, 7 July 2021

President Biden prizes cheap gasoline. He has also committed to halving U.S. greenhouse gas emissions this decade. A recent spat between OPEC producers will test whether he can have both.
Biden weighed into faltering OPEC negotiations over the weekend, calling for the United Arab Emirates and Saudi Arabia to come to terms over production quotas. A White House spokesman said yesterday that administration officials had spoken to both countries about the need to stem recent upticks in crude prices.

Biden's intervention is not the first time he has moved to stave off an increase in oil prices. The president opposed an effort to index the gas tax to inflation as part of negotiations over how to pay for an infrastructure package, and he has been notably cool to suggestions of imposing a carbon tax.

Analysts said his entrance into OPEC's negotiations potentially demonstrates the limits of Biden's climate agenda.
"These are three clear and compelling signs that the administration does not want to see consumers face higher prices for fossil fuels," said Robert McNally, an oil analyst who leads the consulting firm Rapidan Energy Group. "It is climate change on the cheap. If you're serious about climate change, you have to do what the Europeans are doing, basically banning automobiles. There is no political will to go anywhere close to that kind of stuff."
The OPEC negotiations will not affect Biden's climate ambitions, a White House spokeswoman said.
The Biden administration is committed to achieving net-zero emissions by 2050, and to decarbonize the power sector by 2035, but is working to lessen the effect of that transition on the American middle class, spokeswoman Saloni Sharma said in a statement. As part of that transition, the administration is "advocating for reliable and predictable energy supplies right now," she said.
"As we transition as quickly as possible, we need to do so responsibly and we are committed to ensuring that the energy transition is one that takes into account the interests of the middle class, who experience changes in energy prices very directly," Sharma said. "No one should doubt the direction the U.S. is going in and how we are working with the rest of the world."
The moves by OPEC come as the world economy roars back to life, sending oil demand surging even as production remains stagnant.
OPEC and allied nations, meanwhile, are sitting on almost 7 million barrels a day in spare capacity after striking a deal last year to limit production in the face of plummeting demand.
UAE now wants to ratchet up its production quota under that deal, much to the chagrin of Saudi Arabia, which has been content to slowly raise production until the agreement's expiration next year.
Prices have surged as a result of tight supplies. The U.S. benchmark for crude has risen by more than 50% this year, and the international crude benchmark soared by almost as much. Consumers have started to feel the impact. American motorists paid an average of $2.17 a gallon at the end of June last year. Twelve months later, they were paying $3.09.

The increase has attracted Biden's attention, as well as criticism from congressional Republicans.
"The president wants Americans to have access to affordable and reliable energy, including at the pump," White House spokeswoman Jen Psaki told reporters during a briefing yesterday. "And so that's why our team is constantly monitoring gas prices and directly communicating with OPEC parties to get to a deal and allow proposed production increases to move forward."
Biden is "vehemently opposed" to raising domestic gas prices, which is why he is unwilling to increase the gas tax to pay for his infrastructure package, Psaki said. Raising gas prices is a "bottom line redline for him" that he is unwilling to consider, she said.
Full story ($)
5) Surging U.S. LNG undermines Biden's climate agenda
E&E News, 8 July 2021
U.S. exports of liquefied natural gas are surging under President Biden, eclipsing prior records and poised to climb higher still.
Even as the administration pledges to tackle climate change in part by distancing the United States from fossil fuels, the country's LNG exports expanded to a new high this March, according to U.S. Energy Information Administration data.
The uptick highlights a challenge for Biden, who is facing pressure from his party's left flank and environmental groups for a hard pivot from fossil fuels, even as gas supporters say the fuel would help cut global emissions by shifting countries away from coal.
Industry representatives worry that mixed messages or lukewarm support at the federal level for LNG could lead overseas buyers to question the United States' commitment and turn elsewhere for energy imports.
The Biden administration could do a better job of defining how LNG fits into its climate policy goals, said Anna Mikulska, a nonresident fellow in energy studies at Rice University's Baker Institute.
The administration is still "quite unclear or vague" on that score, Mikulska said. At times, comments from senior officials like Energy Secretary Jennifer Granholm and U.S. climate envoy John Kerry have appeared to conflict with each other, she said.
Kerry set off alarms within the industry in January when he warned in a speech to the World Economic Forum that if the globe continues to build infrastructure for gas, "we're going to be stuck with stranded assets in 10 or 20 or 30 years."
By contrast, Granholm has said U.S. LNG exports are often sent to "countries that would otherwise be using very carbon-intensive fuels" (Energywire, Jan. 28).
When pressed on the administration's stance, Granholm and others have mainly talked about working with exporters on reducing emissions — a priority that's shared by industry, according to trade group officials and some analysts...

Aside from a goal to curb the sector's emissions, Biden's approach to LNG stands in stark contrast to the previous two administrations, which outwardly supported exports. Trump-era Energy Secretary Rick Perry dubbed the fuel "freedom gas."
That the Biden administration hasn't said more about LNG is likely a byproduct of the tension between his climate-conscious agenda and the reality that LNG, while cleaner than coal, is still a fossil fuel, experts said.
"The Biden administration is in a little bit of a bind," said Mikulska, noting that an embrace of natural gas could be seen as undercutting the administration's climate goals.
Just last week, Biden's Department of Energy said it would study the emissions footprint of LNG shipments from a proposed export terminal in Alaska as part of an environmental review. That decision prompted concern in the industry and hope from environmentalists that it will lead to increased scrutiny of similar projects (Energywire, July 6).
Full story
6) Biden’s new Cold War with China’s communist tyranny will result in climate collapse, radical activists claim
Global Warming Policy Forum, 8 July 2021

Nobody should be surprised about the latest attempts by radical greens to deploy climate hysteria in their campaign to undermine Western democracies and promote China’s communist tyranny.
As Patricia Adams has shown in her recent GWPF report, Western environmentalists are being controlled and used by the communist regime in China. Western greens have effectively become mouthpieces for President Xi and China’s dictatorship.

“They praise the scale of Chinese ambition on climate change, while paying lipservice in criticizing China’s massive coal expansion. Meanwhile, the greens turn a blind eye to the obvious; China does not honour its international agreements and has no intention of reducing fossil fuel consumption, quite the opposite. While the world has awakened to China’s abuses, western environmentalists are silent,” says Adams. “China plays them as useful idiots.”
Now, more than 40 progressive groups have sent a letter to President Joe Biden and lawmakers urging them to prioritise cooperation with China’s communist leaders on climate change and curb US opposition to Beijing’s destruction of Hong Kong’s democracy, the communist threat of war against Taiwan and the persecution of Uyghur Muslims.
Biden’s new Cold War with China will result in climate collapse, progressives warn
As a new Cold War takes shape between the U.S. and China, progressives fear the result will be a dramatically warming planet.
Over 40 progressive groups sent a letter to President Joe Biden and lawmakers on Wednesday urging them to prioritize cooperation with China on climate change and curb its confrontational approach over issues like Beijing’s crackdown on Hong Kong and forced detention of Uyghur Muslims.
It’s the latest salvo in the months-long drama between progressive Democrats who say cooperation on climate change should take precedence over competition with China, and moderates who think the administration can do both things at once. As the Biden administration solidifies its China strategy, and as anti-China legislation moves through Congress, this intra-Democratic tussle could define the U.S.-China relationship for years to come.
The progressive organizations, including the Sunrise Movement and the Union of Concerned Scientists, “call on the Biden administration and all members of Congress to eschew the dominant antagonistic approach to U.S.-China relations and instead prioritize multilateralism, diplomacy, and cooperation with China to address the existential threat that is the climate crisis,” their letter reads. “Nothing less than the future of our planet depends on ending the new Cold War between the United States and China.”
“To combat the climate crisis and build a global economy that works for everyday working people — in the U.S. and China alike — we must shift from competition to cooperation,” the groups continued.
Challenging China’s regional human rights abuses and aggressions is central to Biden’s foreign policy, while the struggle between American-style democracy and Chinese-style authoritarianism serves as his presidency’s animating idea. “It is clear, absolutely clear … that this is a battle between the utility of democracies in the 21st century and autocracies,” Biden told reporters in April.
The standoff has led to frosty relations between the world’s most powerful countries with no signs of thawing any time soon.
Progressives say Biden must quickly reverse the trend or risk failing on another of his priorities: ending climate change. “His entire climate change agenda could be at risk if his anti-China campaign continues and grows,” said Erik Sperling, the executive director of Just Foreign Policy, one of the groups that signed on to the letter.
Full story
7) OBR's report underestimates indirect costs of Net Zero transition
Gaia Fawkes, 9 July 2021
Plenty of noise was made this week about the Office for Budget Responsibility’s (OBR) ‘Fiscal Risks Report‘, which outlined the potential costs of the government’s transition to net zero by 2050: £1.4 trillion over 30 years, three-quarters of which would be borne by households and private businesses.


If that wasn’t staggering enough, the Global Warming Policy Forum (GWPF) has found that the OBR’s projections still didn’t sufficiently capture the indirect economic effects of the transition, and that their analysis depends on a series of “optimistic assumptions“. In other words: it may well be even worse…

Most of the OBR’s cost assumptions are built on the estimates of the Climate Change Committee, whose figures appear rosy at the best of times: even their most pessimistic projection expects 75% of electricity to come from renewables by 2035, with over 70% of households using hydrogen for heating within a similar window. And all this is assuming the economy doesn’t stagnate or contract. 

The GWPF report adds:
“It is no exaggeration to say that everything in both the CCC’s and the OBR’s cost assessment depends on their optimistic assumption that the cost of renewable electricity will drop significantly.”
“[The] indirect economic effects, correctly identified but not adequately examined by the OBR, will be severely negative for the economy as a whole and the public finances, with stuttering economic activity and stagnant or even falling tax receipts.”

The net zero timeframe target was unrealistic even before the pandemic; now, given the precarity of the post-Covid economy, it’s starting to look a bit ridiculous. 
8) Mistaken claims about malaria and global warming
GWPF Science, 9 July 2021

Impossible emissions scenarios make for impossible health outcomes


It is not true that 8 billion are at risk from climate-change-induced malaria and dengue fever. It is true that this is a claim put forward in a paper in The Lancet Planetary Health. Given that truth, it is the claim in the paper that is wrong.

This is nothing to do with what the effects of a 3.7 degree, or more, temperature rise might be. The important point to grasp is that such a temperature rise is not going to happen. We have explained this in detail in this paper.
The mistaken claim about malaria stems from this part of the paper’s methodology:
"….across four RCPs (arranged from the most conservative to business-as-usual: RCP2.6, RCP4.5, RCP6.0, and RCP8.5)…"

RCP 8.5 is not going to happen. It never was likely to happen. Actions taken so far – from fracking to the prices of solar and wind derived electricity – mean that it is never going to happen. RCP 8.5 is not even a possible outcome, let alone “business as usual”.
In more detail, the phrase “business as usual” in this context means the outcome of social and economic development without further policy changes specifically aimed at reducing emissions and thus temperature changes. To reach the emissions levels of RCP 8.5 it would be necessary to cease to use renewables at all. Further, to stop using – because we run out of conventional reserves – oil and natural gas and revert to coal for the majority of society’s energy needs. In fact, to gain more of society’s – vastly larger in the future – energy, as a portion of total energy used, from coal than we ever have done.
This is not going to happen. Therefore predictions, even model outcomes, based upon the assumption that it will happen are wrong. Not just outside likely results, or to test an extreme, but wrong.
The scientific method is that it is necessary to test theories, hypotheses, against reality. When there is disagreement it is reality that wins, not theory.
It is even possible to agree that if temperatures rise 3.7 degrees then malaria and dengue fever will become more of a problem than they are now. But given that we know that temperatures aren’t going to so rise it’s not a problem that we need to pay much attention to. Further, those that model such a rise in order to scare us – as with telling ghost stories to children perhaps – need to be reminded that such misleading of the political process is going to reduce our attention to problems we actually should be trying to solve.

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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