Pages

Thursday, July 7, 2022

Net Zero Watch: Big win for climate & energy realism

 




EU lawmakers declare gas and nuclear power as ‘green energy’ 


In this newsletter:

1) EU lawmakers declare gas and nuclear power as ‘green energy’ in big win for climate & energy realism
The Wall Street Journal, 6 July 2022 

2) EU chief warns of danger of complete cut-off of Russian gas
Associated Press, 6 July 2022

 
3) Net Zero Germany’s economic foundations are collapsing
Ben Wright, The Daily Telegraph, 5 July 2022
 
4) Brussels’ Net Zero drive ‘making it harder to wean Europe off Russia gas’
The Daily Telegraph, 5 July 2022


5) As Biden fights over gas supply, coal is making a comeback
The Daily Caller, 4 June 2022

6) UK electricity prices ‘soared by 129% over the last year’
Energy Live News, 6 July 2022


7) New coalmine in Cumbria backed by environment secretary
The Times, 6 June 2022

8) Climate Change Committee finally admits heat pumps won't reduce energy bills
The Daily Telegraph, 6 July 2022

Full details:

1) EU lawmakers declare gas and nuclear power as ‘green energy’ in big win for climate & energy realism
The Wall Street Journal, 6 July 2022

Lawmakers overcome environmental opposition amid fears over fuel crisis












Lawmakers in the European Union voted to include nuclear power and natural gas in the bloc’s list of investments deemed sustainable, a move it hopes will trigger more funding of those sectors but that critics said would slow down the EU’s shift to greener energy sources.

Opponents of the plan failed to gather enough support for a veto during a vote in the European Parliament on Wednesday, clearing the way for the two energy sources to be included in the EU’s so-called green taxonomy if they meet a series of conditions such as limits on greenhouse gas emissions.

The taxonomy, which will affect a range of industries beyond energy, is meant to help funnel more money into projects that the bloc considers to be sustainable and is part of a larger push to slash greenhouse gas emissions. It doesn’t bar investments in projects that aren’t on the list or prevent European countries from making decisions about their own energy mix.

The debate over whether nuclear energy and natural gas should be included in the taxonomy took on a new dimension in recent months after Russia’s invasion of Ukraine. About 40% of the gas the EU used last year came from Russia.

Officials from the European Commission, the EU’s executive body, have said natural gas and nuclear energy should be included in the taxonomy under certain conditions because they can help countries transition away from coal. Burning natural gas produces about half the carbon dioxide that is generated by coal, and nuclear-power plants don’t produce carbon dioxide when they are operating.

But environmentalists, lawmakers and some investors have argued the plan risks diluting investments in other projects such as renewable energy. Lawmakers also said their case against including natural gas in the taxonomy became stronger after Russia invaded Ukraine because of the EU’s heavy reliance on Russian gas.
 
see also: The EU must give green light to nuclear and gas or face disaster











2) EU chief warns of danger of complete cut-off of Russian gas
Associated Press, 6 July 2022












BRUSSELS -- European Commission chief Ursula von der Leyen said Wednesday that the 27-nation European Union needs to make emergency plans to prepare for a complete cut-off of Russian gas in the wake of the Kremlin’s war in Ukraine.

“It is obvious: Putin continues to use energy as a weapon. This is why the Commission is working on a European emergency plan,” she told legislators in Strasbourg, France.

The EU has already imposed sanctions on Russia, including on some energy supplies, and is steering away from Kremlin-controlled deliveries. But the head of the EU's executive branch said the bloc needed to be ready for shock disruptions coming from Moscow, and said the first plans would be presented by the middle of the month.

“If worst comes to worst, then we have to be prepared,” she said, hoping to avoid the chaotic scenes, and the my-country-first attitude that some member states showed early on in the COVID-19 pandemic response.

Energy, and the prospect of a winter without enough heating for homes or power to keep factories going, could now pose a similar challenge to EU solidarity and a source for populist-spawned division.

“It is very important to have a European overview and a coordinated approach to a potential complete cut off of Russian gas,” von der Leyen said. A dozen members have already been hit by reductions or full cuts in gas supplies as the political standoff with Moscow over the Ukraine invasion intensifies.

Highlighting the potential challenges ahead, Germany said last week it suspects that Russia may not resume natural gas deliveries to Europe through the Nord Stream 1 pipeline after planned maintenance work in July, complicating the outlook for this winter.

Russian state-owned energy giant Gazprom blamed a technical problem for the reduction in gas flowing through Nord Stream 1, which runs under the Baltic Sea from Russia to Germany. The company said equipment maintenance was affected by Western sanctions.

European Union countries already agreed last month that all natural gas storage in the 27-nation bloc should be topped up to at least 80% capacity for next winter to avoid shortages during the cold season. The new regulation also says underground gas storage on EU soil will need to be filled to 90% capacity before the 2023-24 winter.

Von der Leyen said that the storage stood at 55% a week ago, adding that liquefied natural gas deliveries from the United States had already tripled.

Full story
 
3) Net Zero Germany’s economic foundations are collapsing
Ben Wright, The Daily Telegraph, 5 July 2022



 








Which is the sick man of Europe? There can be no doubt that Britain is suffering significant economic difficulties at the moment. But it’s an interesting thought experiment to ponder whether you would swap them for Germany’s woes.

The UK’s problems can broadly be put down to incompetent governance and counterproductive policies. Yes, it has laboured under poor productivity and stagnant wage growth for the best part of two decades. But this should be solvable when and if the country is led by a government that can walk and chew gum at the same time.

Germany’s issues, on the other hand, are more structural. Having been masked for decades by the euro – which, compared to the traditional strength of the Deutsche Mark, made German goods more competitive abroad – hidden flaws are now bursting into the open. The question is whether the country's economic model can survive and, if not, what that might mean for the eurozone.

If the global financial crisis ended the era of hyper-globalisation, it now seems like Covid might have put the process into reverse. The hope was this would be a temporary phenomenon but, for the time being at least, Putin’s war is accelerating the trend. Few economies are more vulnerable to the coming squeeze than Germany.

There was a glimpse of the pain this might inflict yesterday when Germany reported its first monthly trade deficit in three decades after the value of the country’s exports unexpectedly fell in May.

The shortfall of €1bn was minuscule compared to those of many other developed nations – not least the UK’s own £51.7bn balance of payments deficit in the first three months of the year. But whereas the UK is accustomed to depending on the “kindness of strangers”, this was Germany’s first such shortfall since 1991.

Since reunification, Germany has fashioned itself into an open, trade-integrated, export-driven powerhouse. It sucked in Russian energy to power its factories. These churned out vehicles, machinery and equipment that were then sold to China.

That strategy worked for decades; now, it’s a massive problem. Olaf Scholz’s government faces the unenviable task of dialling back Germany’s dependence on both countries and finding an alternative to globalisation.

Dalia Marin, professor of international economics at the University of Munich, says: “The German economic model is not dead yet. But its high dependence on international trade implies that today’s changing economic and geopolitical environment will confront Germany with greater challenges compared to most other developed countries.”

Lots of European countries are net importers of energy and their trade balances have been skewed by energy prices going through the roof. But Germany is particularly reliant on energy to power its industrial sector, which accounted for 37pc of gas consumption in 2021. In the UK, the figure was 23pc.

Germany imports around 60pc of the energy it uses. Of this, half of all gas and hard coal imports and a third of all oil imports originates in Russia. In total, Germany depends on the Kremlin for about one third of its total energy consumption, according to the London School of Economics.

Berlin is now having to wean itself off Russian hydrocarbons at speed, not least because Putin is threatening to close the taps. The government has provided €15bn in credit lines to buy gas for storage facilities ahead of the winter. However, the head of the country’s energy regulators has warned that this may not be sufficient.

At the same time, Germany is adopting a more circumspect attitude towards its second largest export market. For decades, Berlin pursued a “change through trade” policy towards China. But Beijing’s studied ambivalence towards Russia's invasion of Ukraine, disastrous zero-Covid strategy and persecution of the Uygur people has altered the calculus.

China has recently given indications that it is prepared to follow Russia’s lead in weaponising trade. Beijing recently sanctioned Lithuania after the Baltic state hosted a Taiwanese Representative Office and imposed tariffs on Australia imports after officials criticised Chinese efforts to thwart an investigation into the origins of the Covid pandemic. Speaking at the World Economic Forum in Davos earlier this year, Scholz expressed concern over China's growing power.

And yet, Berlin’s geopolitical pragmatism has been met by something approaching dismay from German industrialists. In an interview with the newspaper Bild am Sonntag over the weekend, Yasmin Fahimi, the head of the German Federation of Trade Unions, said: “Because of the gas bottlenecks, entire industries are in danger of permanently collapsing: aluminium, glass, the chemical industry.”

And last week, Herbert Diess, the chief executive of Volkswagen, said inflation would spiral even further if Germany reduces the amount of business it does with China. Diess told Der Spiegel that "Germany would look completely different" if it turned away from China, warning that such a move would harm growth, wealth and employment.

In truth, there may be little alternative. Germany has reinvented its economy in the past and could do so again. According to a survey by the Ifo Institute, 50pc of German companies with supply chains in China are now rethinking their operations. But this process will undoubtedly take time.

The trouble is, Germany is the only major eurozone country that has consistently run a current account surplus. The longer it continues to post deficits, the greater the strain on the currency, which is already approaching parity with the dollar.

The UK and German economies might both be unwell. But the British malaise appears easier to cure. What’s more, the eurozone’s shared currency means Germany’s sickness could be contagious.
 
4) Brussels’ Net Zero drive ‘making it harder to wean Europe off Russia gas’
The Daily Telegraph, 5 July 2022











Europe’s net zero push is making it difficult to wean the continent off Russian fuel, a Nigerian government minister has warned.

Lai Mohammed, culture and information minister, said Brussels’ push towards green energy risks harming efforts to bolster energy security.

European countries and the UK have over the latest year announced several steps aimed at cutting off funding to fossil fuel projects abroad, to try and cut carbon emissions.

Moves to withhold financing for international fossil fuel projects are “counterproductive” because they deter investment in fossil fuels, Mr Mohammed said.

“Gas will still be needed for the foreseeable future and it would be better for Africa to supply that,” Mr Mohammed said.

“These policies will only deter investment in and planning in the industry, but it would not stop the use of fossil fuels.”

The invasion of Ukraine has prompted a scramble among European countries to cut their dependence on Russian gas supplies and import from other sources.

Nigeria’s vast fossil fuel reserves are eyed as a possible replacement. However, several countries including France, Belgium and Italy as well as the European Investment Bank signed a declaration in November committing to end public support for foreign fossil fuel projects by the end of 2022.

Meanwhile, EU member states have also been given until the end of next year to set out plans to end export credits for foreign fossil fuel projects.

Nigeria, Niger and Algeria have held talks about reviving a stalled $13bn plan to build a pipeline sending gas from Nigeria to Europe, first proposed in 2009, which will need international investment.

Nigeria is also trying to use more natural gas in its own energy mix as an alternative to more heavily polluting coal and oil.

Mr Mohammed said: “We cannot switch overnight to renewable energy. I think we need to refocus on these policies otherwise, it is going to jeopardise energy security.”

Nigeria’s economy is heavily dependent on fossil fuels as one of the world’s largest oil and gas producers, exporting about $27bn [£22bn] worth of oil during 2020 and 35bn cubic feet of gas.

Full story
 
5) As Biden fights over gas supply, coal is making a comeback
The Daily Caller, 4 June 2022












President Joe Biden’s administration is working to wean the U.S. off of oil and onto green energy, but markets are pushing consumers toward using more coal instead.

The world’s largest economies are increasing coal purchases in the wake of Russia’s invasion of Ukraine impacting oil and gas supplies, led by Europe now that Russia has cut gas supplies to the E.U., The Wall Street Journal reported Monday. Among the places where coal consumption is surging are parts of the U.S., exacerbated by unusually strong heat waves pushing power grids to the limit.

Coal is the dirtiest fossil fuel in the world, putting out around twice the carbon emissions of natural gas. And with the Biden administration unwilling to make long-term investments in the industry, the easiest form of energy to ramp up production of is the lowest-quality coal, according to the WSJ.

Coal consumption plummeted in the last decade in the West due to the negative climate impact of the fuel, according to the WSJ. The U.S. shifted heavily toward natural gas, driven by a fracking boom. Now, the Biden administration is declining to make long-term investments in the fossil fuel industry in an attempt to shift the U.S. toward renewables.

However, coal is still a leading fuel globally. While usage has declined in the U.S. and Europe, it’s widespread in India, the world’s second-most populous country, and China, the world’s leading carbon emitter, according to the WSJ.
 
6) UK electricity prices ‘soared by 129% over the last year’
Energy Live News, 6 July 2022



 








Britons were hit by the biggest increase in household electricity costs among 24 countries, according to a report

The UK has been hit by a 129.1% increase in electricity prices over the last year.

That’s according to a new report by The Underfloor Heating Store which suggests the country has experienced the biggest increase in household electricity costs in Europe.

The Czech Republic and the Netherlands follow with an increase of 121.6% and 108.5%.

The analysis also points out that the top five countries that have faced the largest increase in gas prices have seen their gas prices more than triple since the start of 2021.

Belgium has seen an astounding 234.1% increase in gas prices since June last year, now paying 13.7p per kWh for their gas.

Bulgaria with a massive 225% increase in gas prices and Germany with a 218% increase follow while the UK has seen the fourth largest increase in gas prices.
 
7) New coalmine in Cumbria backed by environment secretary
The Times, 6 June 2022












The environment secretary has given his backing to a new coalmine in Cumbria on the eve of a government decision about whether to approve the contentious project.

George Eustice said the alternative was “outsourcing pollution” to countries where standards would be lower.

The proposal for a mine at Whitehaven has the support of local Conservative MPs but is unpopular with environmental campaigners. Developers want to drill underneath the Irish Sea to extract coking coal used for steelmaking. Around 36 per cent of the coal is imported from Russia at present. Michael Gove, the levelling-up, communities and housing secretary, has been asked to announce whether the mine will go ahead by tomorrow.

The mine was initially approved by Cumbria council but is subject to a public inquiry. Boris Johnson appeared to hint he was in favour of the project when he said last month that “it makes no sense to be importing coal . . . when we have our own domestic resources.”

Speaking to The Times, Eustice defended the colliery, saying that coking coal was still needed. “It is with gas as with coal,” he said. “If we still need to use it for certain industries, and there’s still a role for gas in the transition to net zero, not least to create blue hydrogen — if we do need this coal in order to have a viable steel industry, then we might as well use our own coal and use our own gas rather than be reliant on other countries.”

In April the government announced a review of the moratorium on fracking.

Eustice said the argument for allowing fracking in the UK was “weaker” than drilling for coal because the quality of gas extracted from fracking was “much lower” than natural gas. However, he said that in context of high fuel prices the government would keep everything “under review”.

Last week Lord Deben, the chairman of the climate change committee, described the mine as “absolutely indefensible”. The committee published a highly critical report stating that there was “scant evidence” the government could deliver on its target of net zero by 2050.

Eustice dismissed the conclusions as “wrong”, saying that they had failed to take into account the likelihood of technological breakthroughs. He gave the example of feed additives being developed for cattle that could minimise emissions and a Cornish farm that is creating a biofuel made from slurry. “If you could perfect those sorts of technologies at scale, that’s when you make quite rapid inroads into global warming and greenhouse gases,” he said.
 
8) Climate Change Committee finally admits heat pumps won't reduce energy bills
The Daily Telegraph, 6 July 2022












Installing a heat pump will push energy bills higher, the Government's adviser has admitted, despite ministers pressing the technology on households.

The Climate Change Committee, the Government's independent adviser on tackling climate change, has found the running cost of heat pumps is 10pc higher than that of a gas boiler – equal to £100 more a year.

This excludes the upfront capital costs of around £10,000 per household that is needed to replace a gas boiler with a heat pump, according to the Energy and Utilities Alliance, a trade body.

The CCC’s report said: “Even under current record high gas prices, our estimates suggest that the average heating bill for a heat pump is around 10pc higher than for a gas boiler.”

Heat pumps run on electricity, which is around four times more expensive than gas because of the way carbon taxes are applied. These taxes add £93 to an average electricity bill but only £3 to gas bills, according to supplier Octopus, although this is currently being reviewed.

The report added: “Removing energy levies from electricity will directly lower running costs for heat pumps, making them more financially viable.

“In the medium term, heat pump efficiency improvements should also help bring their running costs closer in line with gas boilers.”

Mike Foster, of the EUA, said the data had been “hidden away from the main headlines” and confirmed fears installing heat pumps would worsen the effects of the cost of living crisis.

He said those who suggest heat pumps are the answer to soaring energy bills – particularly as the energy price cap is set to increase later this year – “risk heaping more misery onto ordinary, hard-working families.”

Mr Foster added: “The Government should be looking at ways of reducing our heating bills, not ramping them up. They have a target of 600,000 heat pumps a year to be fitted into homes by 2030. This will force up heating bills, not just according to our analysis, but also to the Government’s own advisors. It’s time for a reset.”

Full story

The London-based Net Zero Watch is a campaign group set up to highlight and discuss the serious implications of expensive and poorly considered climate change policies. The Net Zero Watch newsletter is prepared by Director Dr Benny Peiser - for more information, please visit the website at www.netzerowatch.com.

2 comments:

DeeM said...

There's nothing like a war to inject a huge dose of realism into the wacky world of climate change energy policy.
Now all those woke technocrats have an excuse to adopt two reliable forms of power generation - gas and nuclear - which were always the only way the world was ever going to transition away from coal.
Wind and solar are both unreliable, very expensive and grid-destabilizing and were NEVER going to power the planet.

Kiwialan said...

Aussie has just had record exports of coal, coke and briquettes made from coal dust while our bunch of dickheads trying to govern us worry about farting cows. Bloody strange world we exist now thanks to all the sheeple who voted for this woke racist lot. Kiwialan.