In this newsletter:
1) Claims of 'climate crisis' not supported by empirical data, Italian scientists find
The Daily Sceptic, 14 September 2022
2) A critical assessment of extreme events trends in times of global warming
The European Physical Journal Plus, September 2022
3) This should be the absolute peak of the hurricane season — but it’s dead quiet out there
Eric Berger, Ars Technica, 11 September 2022
4) Ouch! EU stings renewable energy suppliers with €140bn windfall tax
The Daily Telegraph, 14 September 2022
5) Andrew Montford: Renewables will save us a billion trillion pounds! Yeah, right
Net Zero Watch, 15 September 2022
6) US shale bosses tell Europe: ‘There’s no bailout coming’
Financial Times, 14 September 2022
7) Liz Truss to ditch Boris Johnson’s energy plans to focus on driving down cost of household bills
iNews, 14 September 2022
8) Liz Truss urged to scrap green levies in staggering new poll
Daily Express, 13 September 2022
iNews, 14 September 2022
8) Liz Truss urged to scrap green levies in staggering new poll
Daily Express, 13 September 2022
9) Energy bill freeze to hand suppliers up to £1.6bn profit
The Daily Telegraph, 15 November 2022
The Daily Telegraph, 15 November 2022
Full details:
1) Claims of 'climate crisis' not supported by empirical data, Italian scientists find
Four leading Italian scientists have undertaken a major review of historical climate trends and concluded that declaring a ‘climate emergency’ is not supported by the data.
Reviewing data from a wide range of weather phenomena, they say a ‘climate crisis’ of the kind people are becoming alarmed about “is not evident yet”.
The scientists suggest that rather than burdening our children with anxiety about climate change, we should encourage them to think about issues like energy, food and health, and the challenges in each area, with a more “objective and constructive spirit” and not waste limited resources on “costly and ineffective solutions”.
During the course of their work, the scientists found that rainfall intensity and frequency is stationary in many parts of the world. Tropical hurricanes and cyclones show little change over the long term, and the same is true of U.S. tornadoes. Other meteorological categories including natural disasters, floods, droughts and ecosystem productivity show no “clear positive trend of extreme events”. Regarding ecosystems, the scientists note a considerable “greening” of global plant biomass in recent decades caused by higher levels of carbon dioxide in the atmosphere. Satellite data show “greening” trends over most of the planet, increasing food yields and pushing back deserts.
The four scientists are all highly qualified and include physics adjunct professor Gianluca Alimonti, agrometeorologist Luigi Mariani and physics professors Franco Prodi and Renato Angelo Ricci. The last two are signatories to the rapidly growing ‘World Climate Declaration’. This petition states that there is no climate emergency and calls for climate science to be more scientific. It also calls for liberation from the “naïve belief in immature climate models”. In future, it says, “climate research must give significantly more emphasis to empirical science”.
‘Extreme’ weather events attributed by climate models – somehow – to anthropogenic global warming are now the main staple of the climate alarmist industry. As the Daily Sceptic reported on Monday, Sir David Attenborough used a U.K. Met Office model forecast in the first episode of Frozen Planet II to claim that summer Arctic sea ice could be gone within 12 years. But the likelihood of hardy swimming galas over the North Pole by 2035 seems somewhat remote, not least because Arctic sea ice has been growing in many summers since 2012. According to a recent report from the U.S.-based National Snow and Ice Data Center, at the end of August “sea ice extent is likely to remain higher than in recent years”.
Hurricane and cyclones are favourite subjects for green alarmists. It is unsurprising why they focus on these storms, since the Italian scientists note that historically around 60% of all economic damage caused by global disasters is the consequence of U.S. hurricanes. On May 27th, the Met Office predicted that the 2022 Atlantic hurricane season, which runs from June to November, would “most likely” be above average, with a “likelihood” of 18 named tropical storms including nine hurricanes and four major hurricanes. In fact, the current Atlantic hurricane season has had its slowest start for 30 years. At the end of August there have been no hurricanes, and only three named storms, none of which produced winds of 74mph or higher.
There is plenty of evidence that hurricane and cyclone frequency and intensity has changed little over the recent historical record. “To date, global observations do not show any significant trends in both the number and the energy accumulated by hurricanes,” note the Italian scientists. The two graphs below demonstrate this.
The IPCC has reported that hurricanes have increased in frequency in the North Atlantic since 1878, but the scientists note that observations were relatively low during the first decades of the 20th century. After adjusting for lack of observational capacities in the past, there is a nominal upward trend. This trend, they explain, “is not significantly distinguishable from zero”.
The scientists accept that there has been a recent increase in heatwaves, which they attribute to the 1°C rise in global temperatures, although they note global heatwave intensity trends “are not significant”. They also point out that only a limited number of weather stations have observed an increase in global rainfall.
Corresponding evidence for increases in flooding remains elusive, they say, “and a long list of studies shows little or no evidence of increased flood magnitudes, with some studies finding more evidence of decreases than increases”. So far as drought is concerned, the scientists note the AR5 finding of the IPCC that “conclusions regarding global drought trends increasing since the 1970s are no longer supported”. Several studies are said to show no increase in the main indices regarding global droughts.
In fact, a slightly warmer and wetter planet and a little extra CO2 seem to have done wonders for global crop yields. For the period 1961-2019, maize, rice, soyabean and wheat global average yields are reported to have grown every year by 3.3%, 2.4%, 2.6% and 3.8% respectively.
Well-researched, fact-driven, credible scientific papers such as this are crucial in the battle to stop green activists and rentiers having a free run to catastrophise every bad weather event in the interest of promoting a command-and-control Net Zero agenda. Attempting to attribute single weather events to humans burning fossil fuels is the product of feverish imaginations and ‘garbage in, garbage out’ climate models. Rational, evidence-based science should be promoted at every opportunity.
see also: Ralph Alexander: Extreme Weather: The IPCC’s Changing Tune (pdf)
Reviewing data from a wide range of weather phenomena, they say a ‘climate crisis’ of the kind people are becoming alarmed about “is not evident yet”.
The scientists suggest that rather than burdening our children with anxiety about climate change, we should encourage them to think about issues like energy, food and health, and the challenges in each area, with a more “objective and constructive spirit” and not waste limited resources on “costly and ineffective solutions”.
During the course of their work, the scientists found that rainfall intensity and frequency is stationary in many parts of the world. Tropical hurricanes and cyclones show little change over the long term, and the same is true of U.S. tornadoes. Other meteorological categories including natural disasters, floods, droughts and ecosystem productivity show no “clear positive trend of extreme events”. Regarding ecosystems, the scientists note a considerable “greening” of global plant biomass in recent decades caused by higher levels of carbon dioxide in the atmosphere. Satellite data show “greening” trends over most of the planet, increasing food yields and pushing back deserts.
The four scientists are all highly qualified and include physics adjunct professor Gianluca Alimonti, agrometeorologist Luigi Mariani and physics professors Franco Prodi and Renato Angelo Ricci. The last two are signatories to the rapidly growing ‘World Climate Declaration’. This petition states that there is no climate emergency and calls for climate science to be more scientific. It also calls for liberation from the “naïve belief in immature climate models”. In future, it says, “climate research must give significantly more emphasis to empirical science”.
‘Extreme’ weather events attributed by climate models – somehow – to anthropogenic global warming are now the main staple of the climate alarmist industry. As the Daily Sceptic reported on Monday, Sir David Attenborough used a U.K. Met Office model forecast in the first episode of Frozen Planet II to claim that summer Arctic sea ice could be gone within 12 years. But the likelihood of hardy swimming galas over the North Pole by 2035 seems somewhat remote, not least because Arctic sea ice has been growing in many summers since 2012. According to a recent report from the U.S.-based National Snow and Ice Data Center, at the end of August “sea ice extent is likely to remain higher than in recent years”.
Hurricane and cyclones are favourite subjects for green alarmists. It is unsurprising why they focus on these storms, since the Italian scientists note that historically around 60% of all economic damage caused by global disasters is the consequence of U.S. hurricanes. On May 27th, the Met Office predicted that the 2022 Atlantic hurricane season, which runs from June to November, would “most likely” be above average, with a “likelihood” of 18 named tropical storms including nine hurricanes and four major hurricanes. In fact, the current Atlantic hurricane season has had its slowest start for 30 years. At the end of August there have been no hurricanes, and only three named storms, none of which produced winds of 74mph or higher.
There is plenty of evidence that hurricane and cyclone frequency and intensity has changed little over the recent historical record. “To date, global observations do not show any significant trends in both the number and the energy accumulated by hurricanes,” note the Italian scientists. The two graphs below demonstrate this.
The IPCC has reported that hurricanes have increased in frequency in the North Atlantic since 1878, but the scientists note that observations were relatively low during the first decades of the 20th century. After adjusting for lack of observational capacities in the past, there is a nominal upward trend. This trend, they explain, “is not significantly distinguishable from zero”.
The scientists accept that there has been a recent increase in heatwaves, which they attribute to the 1°C rise in global temperatures, although they note global heatwave intensity trends “are not significant”. They also point out that only a limited number of weather stations have observed an increase in global rainfall.
Corresponding evidence for increases in flooding remains elusive, they say, “and a long list of studies shows little or no evidence of increased flood magnitudes, with some studies finding more evidence of decreases than increases”. So far as drought is concerned, the scientists note the AR5 finding of the IPCC that “conclusions regarding global drought trends increasing since the 1970s are no longer supported”. Several studies are said to show no increase in the main indices regarding global droughts.
In fact, a slightly warmer and wetter planet and a little extra CO2 seem to have done wonders for global crop yields. For the period 1961-2019, maize, rice, soyabean and wheat global average yields are reported to have grown every year by 3.3%, 2.4%, 2.6% and 3.8% respectively.
Well-researched, fact-driven, credible scientific papers such as this are crucial in the battle to stop green activists and rentiers having a free run to catastrophise every bad weather event in the interest of promoting a command-and-control Net Zero agenda. Attempting to attribute single weather events to humans burning fossil fuels is the product of feverish imaginations and ‘garbage in, garbage out’ climate models. Rational, evidence-based science should be promoted at every opportunity.
see also: Ralph Alexander: Extreme Weather: The IPCC’s Changing Tune (pdf)
2) A critical assessment of extreme events trends in times of global warming
The European Physical Journal Plus, September 2022
The European Physical Journal Plus, September 2022
Abstract - This article reviews recent bibliography on time series of some extreme weather events and related response indicators in order to understand whether an increase in intensity and/or frequency is detectable. The most robust global changes in climate extremes are found in yearly values of heatwaves (number of days, maximum duration and cumulated heat), while global trends in heatwave intensity are not significant. Daily precipitation intensity and extreme precipitation frequency are stationary in the main part of the weather stations. Trend analysis of the time series of tropical cyclones show a substantial temporal invariance and the same is true for tornadoes in the USA. At the same time, the impact of warming on surface wind speed remains unclear. The analysis is then extended to some global response indicators of extreme meteorological events, namely natural disasters, floods, droughts, ecosystem productivity and yields of the four main crops (maize, rice, soybean and wheat). None of these response indicators show a clear positive trend of extreme events. In conclusion on the basis of observational data, the climate crisis that, according to many sources, we are experiencing today, is not evident yet. It would be nevertheless extremely important to define mitigation and adaptation strategies that take into account current trends.
[...]
Conclusions
From the Second World War, our societies have progressed enormously, reaching levels of well-being (health, nutrition, healthiness of the places of life and work, etc.) that previous generations had not even remotely imagined. Today, we are called to continue on the path of progress respecting the constraints of economic, social and environmental sustainability with the severity dictated by the fact that the planet is about to reach 10 billion inhabitants in 2050, increasingly urbanized.
Since its origins, the human species has been confronted with the negative effects of the climate; historical climatology has repeatedly used the concept of climate deterioration in order to explain negative effect of extreme events (mainly drought, diluvial phases and cold periods) on civilization. Today, we are facing a warm phase and, for the first time, we have monitoring capabilities that enable us to objectively evaluate its effects.
Fearing a climate emergency without this being supported by data, means altering the framework of priorities with negative effects that could prove deleterious to our ability to face the challenges of the future, squandering natural and human resources in an economically difficult context, even more negative following the COVID emergency. This does not mean we should do nothing about climate change: we should work to minimize our impact on the planet and to minimize air and water pollution. Whether or not we manage to drastically curtail our carbon dioxide emissions in the coming decades, we need to reduce our vulnerability to extreme weather and climate events.
Leaving the baton to our children without burdening them with the anxiety of being in a climate emergency would allow them to face the various problems in place (energy, agricultural-food, health, etc.) with a more objective and constructive spirit, with the goal of arriving at a weighted assessment of the actions to be taken without wasting the limited resources at our disposal in costly and ineffective solutions. How the climate of the twenty-first century will play out is a topic of deep uncertainty. We need to increase our resiliency to whatever the future climate will present us.
We need to remind ourselves that addressing climate change is not an end in itself, and that climate change is not the only problem that the world is facing. The objective should be to improve human well-being in the twenty-first century, while protecting the environment as much as we can and it would be a nonsense not to do so: it would be like not taking care of the house where we were born and raised.
Full paper
3) This should be the absolute peak of the hurricane season — but it’s dead quiet out there
Eric Berger, Ars Technica, 11 September 2022
Seasonal activity is running 50 percent below normal levels.
[...]
Conclusions
From the Second World War, our societies have progressed enormously, reaching levels of well-being (health, nutrition, healthiness of the places of life and work, etc.) that previous generations had not even remotely imagined. Today, we are called to continue on the path of progress respecting the constraints of economic, social and environmental sustainability with the severity dictated by the fact that the planet is about to reach 10 billion inhabitants in 2050, increasingly urbanized.
Since its origins, the human species has been confronted with the negative effects of the climate; historical climatology has repeatedly used the concept of climate deterioration in order to explain negative effect of extreme events (mainly drought, diluvial phases and cold periods) on civilization. Today, we are facing a warm phase and, for the first time, we have monitoring capabilities that enable us to objectively evaluate its effects.
Fearing a climate emergency without this being supported by data, means altering the framework of priorities with negative effects that could prove deleterious to our ability to face the challenges of the future, squandering natural and human resources in an economically difficult context, even more negative following the COVID emergency. This does not mean we should do nothing about climate change: we should work to minimize our impact on the planet and to minimize air and water pollution. Whether or not we manage to drastically curtail our carbon dioxide emissions in the coming decades, we need to reduce our vulnerability to extreme weather and climate events.
Leaving the baton to our children without burdening them with the anxiety of being in a climate emergency would allow them to face the various problems in place (energy, agricultural-food, health, etc.) with a more objective and constructive spirit, with the goal of arriving at a weighted assessment of the actions to be taken without wasting the limited resources at our disposal in costly and ineffective solutions. How the climate of the twenty-first century will play out is a topic of deep uncertainty. We need to increase our resiliency to whatever the future climate will present us.
We need to remind ourselves that addressing climate change is not an end in itself, and that climate change is not the only problem that the world is facing. The objective should be to improve human well-being in the twenty-first century, while protecting the environment as much as we can and it would be a nonsense not to do so: it would be like not taking care of the house where we were born and raised.
Full paper
3) This should be the absolute peak of the hurricane season — but it’s dead quiet out there
Eric Berger, Ars Technica, 11 September 2022
Seasonal activity is running 50 percent below normal levels.
The Atlantic hurricane season peaks on September 10.
Everyone from the US agency devoted to studying weather, oceans, and the atmosphere—the National Ocean and Atmospheric Administration—to the most highly regarded hurricane professionals predicted a season with above-normal to well above-normal activity.
For example, NOAA’s outlook for the 2022 Atlantic hurricane season, which runs from June 1 to November 30, predicted a 65 percent chance of an above-normal season, a 25 percent chance of a near-normal season, and a 10 percent chance of a below-normal season. The primary factor behind these predictions was an expectation that La Niña would persist in the Pacific Ocean, leading to atmospheric conditions in the tropical Atlantic more favorable to storm formation and intensification. La Niña has persisted, but the storms still have not come in bunches.
All quiet
To date the Atlantic has had five named storms, which is not all that far off "normal" activity, as measured by climatological averages from 1991 to 2020. Normally, by now, the Atlantic would have recorded eight tropical storms and hurricanes that were given names by the National Hurricane Center.
The disparity is more significant when we look at a metric for the duration and intensity of storms, known as Accumulated Cyclone Energy. By this more telling measurement, the 2022 season has a value of 29.6, which is less than half of the normal value through Saturday, 60.3.
Perhaps what is most striking about this season is that we are now at the absolute peak of hurricane season, and there is simply nothing happening. Although the Atlantic season begins on June 1, it starts slowly, with maybe a storm here or there in June, and often a quiet July before the deep tropics get rolling in August. Typically about half of all activity occurs in the 14 weeks prior to September 10, and then in a mad, headlong rush the vast majority of the remaining storms spin up before the end of October.
While it is still entirely possible that the Atlantic basin—which includes the Atlantic Ocean, Gulf of Mexico, and Caribbean Sea—produces a madcap finish, we're just not seeing any signs of it right now. There are no active systems at the moment, and the National Hurricane Center is tracking just one tropical wave that will move off the African coast into the Atlantic Ocean in the coming days. It has a relatively low chance of development, and none of the global models anticipate much from the system. Our best global models show about a 20 to 30 percent chance of a tropical depression developing anywhere in the Atlantic during the next 10 days.
This is the exact opposite of what we normally see this time of year, when the tropics are typically lit up like a Christmas tree. The reason for this is because September offers a window where the Atlantic is still warm from the summertime months, and we typically see some of the lowest wind-shear values in storm-forming regions.
What went wrong
So what has happened this year to cause a quiet season, at least so far? A detailed analysis will have to wait until after the season, but to date we've seen a lot of dust in the atmosphere, which has choked off the formation of storms. Additionally, upper-level winds in the atmosphere have generally been hostile to storm formation—basically shearing off the top of any developing tropical systems.
While it looks like seasonal forecasts for 2022 will probably go bust, it's important to understand the difference between that activity and the forecasting of actual storms. Seasonal forecasting is still a developing science. While it is typically more right than wrong, predicting specific weather patterns such as hurricanes months in advance is far from an established science.
Full story
4) Ouch! EU stings renewable energy suppliers with €140bn windfall tax
The Daily Telegraph, 14 September 2022
Everyone from the US agency devoted to studying weather, oceans, and the atmosphere—the National Ocean and Atmospheric Administration—to the most highly regarded hurricane professionals predicted a season with above-normal to well above-normal activity.
For example, NOAA’s outlook for the 2022 Atlantic hurricane season, which runs from June 1 to November 30, predicted a 65 percent chance of an above-normal season, a 25 percent chance of a near-normal season, and a 10 percent chance of a below-normal season. The primary factor behind these predictions was an expectation that La Niña would persist in the Pacific Ocean, leading to atmospheric conditions in the tropical Atlantic more favorable to storm formation and intensification. La Niña has persisted, but the storms still have not come in bunches.
All quiet
To date the Atlantic has had five named storms, which is not all that far off "normal" activity, as measured by climatological averages from 1991 to 2020. Normally, by now, the Atlantic would have recorded eight tropical storms and hurricanes that were given names by the National Hurricane Center.
The disparity is more significant when we look at a metric for the duration and intensity of storms, known as Accumulated Cyclone Energy. By this more telling measurement, the 2022 season has a value of 29.6, which is less than half of the normal value through Saturday, 60.3.
Perhaps what is most striking about this season is that we are now at the absolute peak of hurricane season, and there is simply nothing happening. Although the Atlantic season begins on June 1, it starts slowly, with maybe a storm here or there in June, and often a quiet July before the deep tropics get rolling in August. Typically about half of all activity occurs in the 14 weeks prior to September 10, and then in a mad, headlong rush the vast majority of the remaining storms spin up before the end of October.
While it is still entirely possible that the Atlantic basin—which includes the Atlantic Ocean, Gulf of Mexico, and Caribbean Sea—produces a madcap finish, we're just not seeing any signs of it right now. There are no active systems at the moment, and the National Hurricane Center is tracking just one tropical wave that will move off the African coast into the Atlantic Ocean in the coming days. It has a relatively low chance of development, and none of the global models anticipate much from the system. Our best global models show about a 20 to 30 percent chance of a tropical depression developing anywhere in the Atlantic during the next 10 days.
This is the exact opposite of what we normally see this time of year, when the tropics are typically lit up like a Christmas tree. The reason for this is because September offers a window where the Atlantic is still warm from the summertime months, and we typically see some of the lowest wind-shear values in storm-forming regions.
What went wrong
So what has happened this year to cause a quiet season, at least so far? A detailed analysis will have to wait until after the season, but to date we've seen a lot of dust in the atmosphere, which has choked off the formation of storms. Additionally, upper-level winds in the atmosphere have generally been hostile to storm formation—basically shearing off the top of any developing tropical systems.
While it looks like seasonal forecasts for 2022 will probably go bust, it's important to understand the difference between that activity and the forecasting of actual storms. Seasonal forecasting is still a developing science. While it is typically more right than wrong, predicting specific weather patterns such as hurricanes months in advance is far from an established science.
Full story
4) Ouch! EU stings renewable energy suppliers with €140bn windfall tax
The Daily Telegraph, 14 September 2022
The EU has laid out plans to raise €140bn (£121bn) by capping revenues for non-gas energy suppliers as part of a radical effort to halt the escalating crisis.
Ursula von der Leyen, European Commission President, said the funds would come from capping revenues for producers of low-cost power such as renewables and nuclear.
She told politicians in Brussels: “In these times it is wrong to receive extraordinary record revenues and profits benefiting from war and on the back of our consumers. In these times, profits must be shared and channelled to those who need it most.”
Other measures under consideration include a windfall tax on fossil fuel companies and steps to cut energy use to avoid blackouts this winter.
However, the bloc has stepped back from an initial plan to cap Russian gas prices amid division among member states over whether such a move would help or harm efforts to secure energy supplies.
Ms von der Leyen also said the EU was working to establish a “more representative benchmark” for gas and was exploring a wider overhaul of the electricity market to decouple power prices from the soaring cost of gas.
5) Andrew Montford: Renewables will save us a billion trillion pounds! Yeah, right
Net Zero Watch, 15 September 2022
Ursula von der Leyen, European Commission President, said the funds would come from capping revenues for producers of low-cost power such as renewables and nuclear.
She told politicians in Brussels: “In these times it is wrong to receive extraordinary record revenues and profits benefiting from war and on the back of our consumers. In these times, profits must be shared and channelled to those who need it most.”
Other measures under consideration include a windfall tax on fossil fuel companies and steps to cut energy use to avoid blackouts this winter.
However, the bloc has stepped back from an initial plan to cap Russian gas prices amid division among member states over whether such a move would help or harm efforts to secure energy supplies.
Ms von der Leyen also said the EU was working to establish a “more representative benchmark” for gas and was exploring a wider overhaul of the electricity market to decouple power prices from the soaring cost of gas.
5) Andrew Montford: Renewables will save us a billion trillion pounds! Yeah, right
Net Zero Watch, 15 September 2022
Yesterday, the Green media was getting extremely excited about a new paper, which claimed that renewable energy was going to save society millions and billions and trillions of pound by 2050 (or something like that). Ten trillion pounds by 2050 said the BBC.
As readers here know, I keep a close eye on the cost of renewables, and have published papers on both offshore and onshore wind, showing that the financial accounts of operators in both sectors show no sign of significant cost reductions. It’s not just me either: my findings closely match those of the energy economist, Professor Gordon Hughes, the energy analyst Kathryn Porter, and an important paper in the peer reviewed literature.
So the idea that renewables are going to save us lots of money is, at first sight, pretty implausible. I decided to take a look at the underlying paper, which comes from the Martin School, at Oxford University.
The methodology is, in essence, extremely crude: it involves extrapolating historic cost trends out along an expected curve (Wright’s law, apparently), while jazzing it up a little with what they call a stochastic methodology, which seems to just generate an uncertainty window. The latter details are, for the purposes of this post, largely irrelevant, however – it’s all gazing at tea-leaves in my opinion. What interested me was that they were generating predictions of future cost reductions from historic falling cost trends. As already noted, lots of people find no such cost reductions in windfarm accounts (and in fact, I have some limited data on solar, which tells a similar story).
Where are the Oxford Martin team getting this data from? Buried deep in the supplementary information to the paper, I learned that it came from the International Renewable Energy Agency (IRENA). I have been trying to get to the bottom of IRENA’s claims of cost reductions for some time, and recently worked out what I think is the underlying reason.
It’s all to do with the way currency is handled. IRENA’s work is all demoninated in USD (and as a result, so is the Oxford Martin paper). But the problem of using a single currency is that the final cost figures will be affected by any currency fluctuations. And boy, have there been some big currency fluctuations in the last ten years. In particular, against the dollar, sterling has depreciated by 30%, the Euro by 25%, the Yen by nearly half, and the Brazilian Real by two thirds. When reporting in USD the costs of operators in any of these places, any reduction of less than these values represents an underlying increase in costs. Take the UK for example. According to IRENA, onshore wind costs fell from 0.086c/kWh in 2010 to 0.071c/kWh in 2019 (see figure below).
As readers here know, I keep a close eye on the cost of renewables, and have published papers on both offshore and onshore wind, showing that the financial accounts of operators in both sectors show no sign of significant cost reductions. It’s not just me either: my findings closely match those of the energy economist, Professor Gordon Hughes, the energy analyst Kathryn Porter, and an important paper in the peer reviewed literature.
So the idea that renewables are going to save us lots of money is, at first sight, pretty implausible. I decided to take a look at the underlying paper, which comes from the Martin School, at Oxford University.
The methodology is, in essence, extremely crude: it involves extrapolating historic cost trends out along an expected curve (Wright’s law, apparently), while jazzing it up a little with what they call a stochastic methodology, which seems to just generate an uncertainty window. The latter details are, for the purposes of this post, largely irrelevant, however – it’s all gazing at tea-leaves in my opinion. What interested me was that they were generating predictions of future cost reductions from historic falling cost trends. As already noted, lots of people find no such cost reductions in windfarm accounts (and in fact, I have some limited data on solar, which tells a similar story).
Where are the Oxford Martin team getting this data from? Buried deep in the supplementary information to the paper, I learned that it came from the International Renewable Energy Agency (IRENA). I have been trying to get to the bottom of IRENA’s claims of cost reductions for some time, and recently worked out what I think is the underlying reason.
It’s all to do with the way currency is handled. IRENA’s work is all demoninated in USD (and as a result, so is the Oxford Martin paper). But the problem of using a single currency is that the final cost figures will be affected by any currency fluctuations. And boy, have there been some big currency fluctuations in the last ten years. In particular, against the dollar, sterling has depreciated by 30%, the Euro by 25%, the Yen by nearly half, and the Brazilian Real by two thirds. When reporting in USD the costs of operators in any of these places, any reduction of less than these values represents an underlying increase in costs. Take the UK for example. According to IRENA, onshore wind costs fell from 0.086c/kWh in 2010 to 0.071c/kWh in 2019 (see figure below).
But during that time, the exchange rate went from roughly 1.60 to 1.28, so in Sterling terms the equivalent figures are 5.3p and 5.5p – a small increase!
This is exactly the situation I reported for UK onshore windfarms in my paper at the start of this year (Their absolute figures are much lower than mine though, presumably because they are using different assumptions to me).
This is clearly going to completely undermine IRENA’s overall figures for renewables cost trends. The UK, the Eurozone, Japan and Brazil between them have a very significant proportion of the world’s renewables. The only major centre for renewables that doesn’t seem to have suffered a depreciating exchange rate against the dollar is China, for which, interestingly, IRENA doesn’t detect much of a reduction in wind costs and for which the solar trend seems to have bottomed out (see figure below).
This is exactly the situation I reported for UK onshore windfarms in my paper at the start of this year (Their absolute figures are much lower than mine though, presumably because they are using different assumptions to me).
This is clearly going to completely undermine IRENA’s overall figures for renewables cost trends. The UK, the Eurozone, Japan and Brazil between them have a very significant proportion of the world’s renewables. The only major centre for renewables that doesn’t seem to have suffered a depreciating exchange rate against the dollar is China, for which, interestingly, IRENA doesn’t detect much of a reduction in wind costs and for which the solar trend seems to have bottomed out (see figure below).
It didn’t have to be like this, of course. IRENA could have created some sort of an index (1990 = 100, or something) which would eliminate the currency effect. But they didn’t, and now the Oxford Martin School guys have picked it up without understanding it, and have extrapolated what is, in essence a foreign exchange fluctuation out to 2050 and have concluded that renewables will save the world.
Experts, eh?
6) US shale bosses tell Europe: ‘There’s no bailout coming’
Financial Times, 14 September 2022
Experts, eh?
6) US shale bosses tell Europe: ‘There’s no bailout coming’
Financial Times, 14 September 2022
The US shale industry has warned it cannot rescue Europe with increased oil and gas supplies this winter amid fears that a plunge in Russian exports will send crude prices soaring back above $100 a barrel.
Even though oil markets have softened in recent weeks, the respite could end when an EU embargo on Russian sales comes into full effect later this year. US Treasury secretary Janet Yellen this week warned the embargo “could cause a spike in oil prices”.
However, US shale executives sitting on vast oil and natural gas reserves that could be used to alleviate a European energy crunch say they will be unable to step up supplies quickly enough to prevent winter shortages.
“It’s not like the US can pump a bunch more. Our production is what it is,” said Wil VanLoh, head of private equity group Quantum Energy Partners, one of the shale patch’s biggest investors.
“There’s no bailout coming,” VanLoh added. “Not on the oil side, not on the gas side.”
Oil and liquefied gas exports from the US have risen to take advantage of higher prices in Europe but are now near a maximum, executives said, warning crude output growth will fall short of government forecasts for around 1mn barrels a day this year.
Asked about the prospect of a big production increase from the US shale industry, Scott Sheffield, chief executive of Pioneer Natural Resources, said: “No, I don’t see it coming.”
“We’re not adding [drilling] rigs and I don’t see anyone else adding rigs,” said Sheffield, who runs one of the biggest oil producers in the US. Crude prices could rise above $120 a barrel this winter as supplies tighten, he added.
The International Energy Agency said on Wednesday that oil sales from Russia, the world’s biggest petroleum exporter, could fall by almost 20 per cent when the EU embargo takes full effect. Brent prices rose 1 per cent to $94 a barrel following the report.
Soaring shale production in the past decade made the US the world’s biggest oil producer, with pre-coronavirus pandemic output hitting 13mn b/d, or more than 10 per cent of global supply. Output growth each year during the boom years on its own met the overall increase in global demand, helping to keep a lid on crude prices.
But US output last week had recovered to just 12.1mn b/d following a big decline when oil prices fell during the pandemic. New concerns about shale’s sluggish supply growth come as traders also grow anxious about the Opec producer group’s ability to raise supply. Last week, the cartel announced a plan to begin trimming its output.
While supermajors Chevron and ExxonMobil, as well as some private companies, are ramping up drilling, the overall number of operating rigs has stalled in recent weeks and productivity per well has plunged.
Ben Dell, chief executive of private equity group Kimmeridge Energy, said the shale industry’s investors on Wall Street would not give their blessing to a big production increase, preferring a low-production, high-profit model.
“Investors generally don’t want shale companies to pursue a growth model,” he said. “The capital availability is extremely limited.”
Modest supply increases from the US in the coming months would “not move things at a world scale”, said Matt Gallagher, head of private driller Greenlake Energy Ventures. “It can be dangerous if we think that this cheap energy can grow — especially on the oil side — forever.”
The US government has fought for months to drive down crude and petrol prices, which hit a record high earlier this year and alarmed the Biden administration ahead of midterm elections in November.
The White House has called on shale producers to increase supply, with energy secretary Jennifer Granholm describing the country as being on a “war footing”.
Yellen has said the US is working with G7 allies to carve out potential exemptions to the Russian embargo to avoid a supply shock.
Even though oil markets have softened in recent weeks, the respite could end when an EU embargo on Russian sales comes into full effect later this year. US Treasury secretary Janet Yellen this week warned the embargo “could cause a spike in oil prices”.
However, US shale executives sitting on vast oil and natural gas reserves that could be used to alleviate a European energy crunch say they will be unable to step up supplies quickly enough to prevent winter shortages.
“It’s not like the US can pump a bunch more. Our production is what it is,” said Wil VanLoh, head of private equity group Quantum Energy Partners, one of the shale patch’s biggest investors.
“There’s no bailout coming,” VanLoh added. “Not on the oil side, not on the gas side.”
Oil and liquefied gas exports from the US have risen to take advantage of higher prices in Europe but are now near a maximum, executives said, warning crude output growth will fall short of government forecasts for around 1mn barrels a day this year.
Asked about the prospect of a big production increase from the US shale industry, Scott Sheffield, chief executive of Pioneer Natural Resources, said: “No, I don’t see it coming.”
“We’re not adding [drilling] rigs and I don’t see anyone else adding rigs,” said Sheffield, who runs one of the biggest oil producers in the US. Crude prices could rise above $120 a barrel this winter as supplies tighten, he added.
The International Energy Agency said on Wednesday that oil sales from Russia, the world’s biggest petroleum exporter, could fall by almost 20 per cent when the EU embargo takes full effect. Brent prices rose 1 per cent to $94 a barrel following the report.
Soaring shale production in the past decade made the US the world’s biggest oil producer, with pre-coronavirus pandemic output hitting 13mn b/d, or more than 10 per cent of global supply. Output growth each year during the boom years on its own met the overall increase in global demand, helping to keep a lid on crude prices.
But US output last week had recovered to just 12.1mn b/d following a big decline when oil prices fell during the pandemic. New concerns about shale’s sluggish supply growth come as traders also grow anxious about the Opec producer group’s ability to raise supply. Last week, the cartel announced a plan to begin trimming its output.
While supermajors Chevron and ExxonMobil, as well as some private companies, are ramping up drilling, the overall number of operating rigs has stalled in recent weeks and productivity per well has plunged.
Ben Dell, chief executive of private equity group Kimmeridge Energy, said the shale industry’s investors on Wall Street would not give their blessing to a big production increase, preferring a low-production, high-profit model.
“Investors generally don’t want shale companies to pursue a growth model,” he said. “The capital availability is extremely limited.”
Modest supply increases from the US in the coming months would “not move things at a world scale”, said Matt Gallagher, head of private driller Greenlake Energy Ventures. “It can be dangerous if we think that this cheap energy can grow — especially on the oil side — forever.”
The US government has fought for months to drive down crude and petrol prices, which hit a record high earlier this year and alarmed the Biden administration ahead of midterm elections in November.
The White House has called on shale producers to increase supply, with energy secretary Jennifer Granholm describing the country as being on a “war footing”.
Yellen has said the US is working with G7 allies to carve out potential exemptions to the Russian embargo to avoid a supply shock.
7) Liz Truss to ditch Boris Johnson’s energy plans to focus on driving down cost of household bills
iNews, 14 September 2022
iNews, 14 September 2022
The Government’s Energy Bill is set to be paused or ditched completely as Liz Truss focuses on capping customers’ bills and reforming the UK’s electricity market, i has been told.
Jacob Rees-Mogg, the new Secretary of State for Business, Energy and Industrial Strategy, told officials on Monday that he planned to effectively put on hold the Energy Bill currently going through the House of Lords, multiple sources said.
The legislation, part of Boris Johnson’s last Queen’s Speech, was wide-ranging and would have overhauled everything from carbon dioxide transport to carbon capture and civil nuclear power production.
But the bill, which is still at an early stage of its parliamentary process, now faces being scrapped or dramatically reworked after Downing Street stressed the Prime Minister wanted to prioritise capped bills and urgent reform of electricity markets.
Full story
8) Liz Truss urged to scrap green levies in staggering new poll
Daily Express, 13 September 2022
Jacob Rees-Mogg, the new Secretary of State for Business, Energy and Industrial Strategy, told officials on Monday that he planned to effectively put on hold the Energy Bill currently going through the House of Lords, multiple sources said.
The legislation, part of Boris Johnson’s last Queen’s Speech, was wide-ranging and would have overhauled everything from carbon dioxide transport to carbon capture and civil nuclear power production.
But the bill, which is still at an early stage of its parliamentary process, now faces being scrapped or dramatically reworked after Downing Street stressed the Prime Minister wanted to prioritise capped bills and urgent reform of electricity markets.
Full story
8) Liz Truss urged to scrap green levies in staggering new poll
Daily Express, 13 September 2022
A poll of Express.co.uk readers shows that 97 percent are in favour of suspending green levies to save on energy bills.
Liz Truss should “scrap not suspend” green levies, according to a new poll of Express.co.uk readers. Last week Prime Minister Liz Truss unveiled a new energy support package to help Britons through the cost of living crisis and manage spiralling energy bills.
She announced that household energy bills will remain frozen at £2,500 for two years from October.
The Government is expected to borrow £100billion to pay for the scheme.
Ms Truss has previously pledged to reduce energy bills further by suspending the green energy levy.
Green levies are an environmental charge which is used to fund green energy policies, improvements to energy efficiency and long-term energy security.
The charge makes up around eight percent of the average energy bills and scrapping it could save households £150 a year.
In a poll that ran from midday on Wednesday, September 7, to 1pm on Tuesday, August 13, Express.co.uk asked readers: “Should Liz Truss suspend the green energy levy to reduce bills?”
A total of 3,813 readers responded, with the overwhelming majority, 97 percent (3,703 people) answered “yes”, Ms Truss should suspend the green energy levy.
A further three percent (103 people) said “no”, she should not, while just seven people said they did not know either way.
Full story
Liz Truss should “scrap not suspend” green levies, according to a new poll of Express.co.uk readers. Last week Prime Minister Liz Truss unveiled a new energy support package to help Britons through the cost of living crisis and manage spiralling energy bills.
She announced that household energy bills will remain frozen at £2,500 for two years from October.
The Government is expected to borrow £100billion to pay for the scheme.
Ms Truss has previously pledged to reduce energy bills further by suspending the green energy levy.
Green levies are an environmental charge which is used to fund green energy policies, improvements to energy efficiency and long-term energy security.
The charge makes up around eight percent of the average energy bills and scrapping it could save households £150 a year.
In a poll that ran from midday on Wednesday, September 7, to 1pm on Tuesday, August 13, Express.co.uk asked readers: “Should Liz Truss suspend the green energy levy to reduce bills?”
A total of 3,813 readers responded, with the overwhelming majority, 97 percent (3,703 people) answered “yes”, Ms Truss should suspend the green energy levy.
A further three percent (103 people) said “no”, she should not, while just seven people said they did not know either way.
Full story
9) Energy bill freeze to hand suppliers up to £1.6bn profit
The Daily Telegraph, 15 November 2022
The Daily Telegraph, 15 November 2022
The taxpayer is to fund profits of up to £1.6bn for energy suppliers this year after their earnings were protected in Liz Truss's freeze on household bills.
Businesses will be allowed to make a margin of 1.9pc on energy that they sell to the public through the Prime Minister's subsidy scheme, which caps the average bill at £2,500.
The cost of supplying households is expected to hit more than £80bn over the next year owing to a surge in wholesale prices.
This means that companies will be in line for a £1.6bn profit – even though the Treasury is partly responsible for footing this cost.
Rocketing gas costs over the past year have triggered a cost-of-living crisis, with average household bills climbing 54pc in April to £1,977.
They were set to increase to £3,549 in October after Ofgem, the energy regulator, raised the price cap on energy bills. The cap, introduced in 2019, changes every three months to reflect wholesale costs.
To avoid plunging households into crisis, Liz Truss stepped in last Thursday to freeze bills at £2,500 a year on average.
Under the plans, the Government will pay suppliers the difference between the lower frozen rate and what they would have charged their customers without the freeze in place.
The price cap allows suppliers to make up to 1.9pc in profits under its existing rules, meaning this margin is now being supported by a state subsidy.
Martin Young, an analyst at Investec, said that the margin would be worth about £1.6bn across the industry over the next year if the price cap stays at its current level.
Many suppliers will make a smaller profit than the margin allowed, or none at all, by running their business differently than Ofgem expects.
However, the allowance is likely to raise questions for the Government and industry at a time of vast public spending.
Full story
Businesses will be allowed to make a margin of 1.9pc on energy that they sell to the public through the Prime Minister's subsidy scheme, which caps the average bill at £2,500.
The cost of supplying households is expected to hit more than £80bn over the next year owing to a surge in wholesale prices.
This means that companies will be in line for a £1.6bn profit – even though the Treasury is partly responsible for footing this cost.
Rocketing gas costs over the past year have triggered a cost-of-living crisis, with average household bills climbing 54pc in April to £1,977.
They were set to increase to £3,549 in October after Ofgem, the energy regulator, raised the price cap on energy bills. The cap, introduced in 2019, changes every three months to reflect wholesale costs.
To avoid plunging households into crisis, Liz Truss stepped in last Thursday to freeze bills at £2,500 a year on average.
Under the plans, the Government will pay suppliers the difference between the lower frozen rate and what they would have charged their customers without the freeze in place.
The price cap allows suppliers to make up to 1.9pc in profits under its existing rules, meaning this margin is now being supported by a state subsidy.
Martin Young, an analyst at Investec, said that the margin would be worth about £1.6bn across the industry over the next year if the price cap stays at its current level.
Many suppliers will make a smaller profit than the margin allowed, or none at all, by running their business differently than Ofgem expects.
However, the allowance is likely to raise questions for the Government and industry at a time of vast public spending.
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.
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