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Are renewables good for democracy? Not necessarily.

18 August, 2017 - 15:00

In Carbon Democracy, Timothy Mitchell describes how people’s ability to sabotage the economic system strengthened democracy. Craig Morris wonders what the future holds – and if the year 2050 might be cleaner, but also less democratic.

Citizen energy – made possible by renewables – is coming under attack. (Source: Bündnis Bürgerenergie e.V., Jörg Farys)

This is part four of a series on democracy and energy; read parts one, two and three.

To review, one of Mitchell’s main tenets is that democracy is not a state of mind, but an ability. If a county has a (strong) democracy, it’s not because the people there are democratically minded, but rather that they have ways of making politicians and business leaders listen. Thus, the coal sector originally strengthened democracy: “The democratic militancy of coal miners could be traced in part to the autonomy that minors exercised at the coal face.”

But now, coal mining is increasingly mechanized, so Mitchell’s statement no longer holds true for the future: the coal sector will not be a place where citizens can sabotage the economy if fewer people work there.

As Mitchell explains, the oil sector was used to weaken the influence of workers. (He doesn’t discuss nuclear, but relatively few people work in the sector, and nuclear plants are likely to be dismantled faster than they are added in coming decades anyway.)

What about renewables? Mitchell doesn’t say, but his take on economics tells us what to look for.

Mitchell points out that our current definition of the “economy” dates back no earlier than the 1930s. Before that, “economy” meant the prudent management of resources for the good of the populace – not private-sector exploitation of those resources under “market rules.” Around that time, democratic decisions started becoming subject to these rules.

Economists had previously been moral philosophers, but they now became statisticians as math entered the foreground of economics. (But the moral aspect never left: “Modern mathematical statistics… was developed for the purpose of the eugenics movement,” Mitchell reminds us.)

As modern economics developed, the question was how to count flows in the economy: “One side wanted economics to start from natural resources and flows of energy, the other to organize the discipline around the study of prices and flows of money. The battle was won by the second group.” We simply did not have a good estimate of the natural resources available (a problem that still plagues us today), so economists counted something easier to measure: money changing hands.

The purpose was to measure Germany’s ability to repay its debt from World War I (and more generally, a country’s potential tax base so governments could estimate tax revenue). The goal of policymakers should be to increase happiness and well-being, not simply cause people to enter into financial transactions, so we now conflate economic growth (counted in this way) with societal improvements.

Because we now only count money circulating, the limits to growth seem less clear than they did in the days when wealth was based on physical processes. Nowadays, pollution leads to “growth” because clean-ups and medical care cause money to change hands: “The increased expenditure required to deal with the damage caused by fossil fuels appeared as an addition rather than an impediment to growth.” Disappearing resources were never subtracted; in fact, nothing is. Economists can only add, not subtract, as Herman Daly often complains (PDF). Economists explain growth beyond previously perceived physical limits by attributing the progress to technology, but Mitchell argues they fail to subtract the reduction of natural capital.

Simultaneously, mathematical (as opposed to moral) economics started off as a pushback against popular will. Neoliberalism dating back to Friedrich Hayek began as an “alternative project to defeat… populist democracy.” In August 1938, Hayek and others met at a colloquium in Paris “to discuss the work of Walter Lippman criticizing the New Deal.” Lippmann had written about “the dangers of public opinion and the need to expand the areas of concern that are reserved to the decisions of experts.” The “economy” thus became a “new mode of governing democracies… whose experts began to displace democratic debate and whose mechanisms set limits to egalitarian demands.”

These are the rules we now live under; renewables do not change that. But they might bring about an awareness, as people realize they can now make their own energy, that people are citizens first, consumers second. Ownership matters, and energy supply no longer needs to come only from current providers.

Incumbent firms will not take this competition from customers sitting down, which is why they are lobbying against rooftop residential solar in the US; the market could shrink this year. Mitchell’s question from his concluding chapter is thus prescient: “To what powers do we want to subject ourselves?” Or, as we put it in our book, if the energy transition succeeds: “The year 2050 might be cleaner, but also less democratic.”

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

“Free trade” should be called “forced trade”

17 August, 2017 - 16:25

Timothy Mitchell’s Carbon Democracy says that our fossil fuel consumption has shaped the state of our democracies in ways poorly understood. A look at the role of the oil sector from colonialism until today sheds light on the impact. Craig Morris takes a look.

As oil resources entered the foreground, ‘forced trade’ became the norm. (Photo by John Messina via the US EPA, edited.)

This is part three of a series on democracy and energy; read parts one and two.

One big question in history is why Europe colonized the planet although, as late as the 1700s, China and India, for instance, had equally or more advanced civilizations. Mitchell explains that the dawn of the coal age in the UK necessitated colonialism.

With the invention of the steam engine fired with coal power, the energy the British could utilize easily outstripped locally available raw materials, such as textiles. Foreign countries then had to be forced to stop growing crops needed locally and focus on exports. Until then, trade had been practiced worldwide not as a means of making production more efficient, but as a way of getting materials (like porcelain and spices) you couldn’t make at home. Otherwise, trade was used to show peaceful intentions.

Europe invented capitalism long ago. Hernán Cortes’ men independently exploited native Americans to increase their own individual wealth (listen to “The Conquistadors and the Birth of the Modern World Economy”). China and India knew no such system; there, strategies still came from central authorities. In Europe, everyone who could and dared to was free to start enslaving natives for profit. Modern slavery marked the beginning of capitalism.

By the 1800s, coal power started to devour large quantities of cotton, sugar, etc. The coal age thus exponentially grew the slave business previously started by early capitalists. In the colonies, the focus was on getting the colonized to hand over their resources. “Private land ownership,” Mitchell explains, was “a method of local dispossession.” Landowners decided what crops were grown based not on what local communities needed, but on the best price that could be obtained in exports.

Colonized communities were forced to switch to export-based economies. During the potato famine in (colonized) Ireland, the country continued to export produce to the UK even as the Irish emigrated or starved. In China, the British forced the Chinese to allow them to sell opium in what has become known as the Opium Wars. “The modern, large-scale commercial corporation was invented precisely” to establish “oligopolies or exclusive territories of operation,” Mitchell explains. The business world still sees national (environmental, etc.) laws as impediments to “free” trade in this manner.

In comes America

European-style colonization didn’t sit so well the United States, however. After World War I, US President Wilson argued that the colonized should “have a say in choosing which Western power would govern them,” as Mitchell puts it. But independence was still out of the question. Egypt and Syria declared theirs in March 1920, but their right to do so was not recognized in the West, which claimed that the colonized still needed to be “developed.”

Thus, economic advancement became a precondition for democracy, thereby forcing the colonies to continue “trading” under terms dictated by the West. The colonized were not to be allowed “to deny their bounties to those who need them,” as the British Secretary of State for the colonies commented at the time.

As oil resources entered the foreground, the next step was to create “protectorates”– as though the colonized needed protecting. It was claimed that ethnic minorities needed protection, but often Western powers undermined agreements reached between local parties. To protect an oil pipeline in Palestine, Mitchell writes, “the British created of a force of armed Jewish settlers to assist with its defense… thereby creating the nucleus of the Zionist army that seized control of Palestine in 1948.” Likewise, “Washington was unable to prevent Iraq from reaching a settlement with the Kurds in 1970,” and the US government feared the “threat of stability in the Gulf,” Mitchell argues.

After World War II, the need to protect “strategic reserves” in the Cold War replaced the concept of protectorates as colonialism faded. The US used the Marshall Plan to finance oil infrastructure in Europe: “over 10% of {the} funds were used to procure oil, representing the largest single use of Marshall Plan money” and “making the oil companies among the largest beneficiaries of Marshall plan aid.” As Mitchell documents, the United States government was especially keen on transitioning to Europe from coal to oil, partly “to undermine the political power of Europe’s coal miners.”

As Europe settled into its post-colonial decades of peace, its prosperity was increasingly purchased with pushback against democracy both at home and in the Global South. In my next and last post on Mitchell’s book, I look into whether his historical reading has any relevance for the future. After all, the coal sector is increasingly automated – and hence, less vulnerable to sabotage by workers demanding better conditions.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

How coal and oil impact democracy differently

15 August, 2017 - 15:36

Because it was vulnerable to worker sabotage, the coal sector provided an environment in which democracy could grow stronger, at least up until the mid-20th century, when oil began to replace it – not only as a source of fuel, but as a way of keeping democratic demands in check. Craig Morris goes in-depth.

Coal depended on workers, and they could make democratic demands. (Photo via Wikipedia, CC BY-SA 3.0)

In my previous post on Timothy Mitchell’s book Carbon Democracy, I presented his thesis that democracy comes about when the public develops “the means to withhold consent.” Today, I’d like to present Mitchell’s ideas about the relative vulnerability of coal compared to oil.

Historically, coal production has been labor-intensive. At points all along the production chain – from (underground) mining to transport by train and points of consumption (stokers feeding coal into a furnace) – people worked. At all points, they could therefore refuse to work and sabotage supplies.

Furthermore, Mitchell points out that coal miners, especially those underground, were far from the supervision of management and could therefore scheme. In addition, lumps of coal leave the mine in a form that is more or less ready to use in a furnace at a power plant, ship, train, etc. Some cleaning, sorting, and drying takes place, but no further “refinement” is needed.

In contrast, crude oil comes out of the ground and is first sent through a refinery before its various products (mainly gasoline, diesel, and kerosene) are ready for sale to consumers. Workers in the oil sector thus include a larger number of skilled engineers and technicians, whereas workers in the coal sector are less stratified and generally have lower skills. Coal workers thus have more in common as a group, and their interests are farther away from those of top management that is the case in the oil sector. And of course, workers in the oil fields “remain above ground, closer to the supervision of managers.”

Oil also flows through pipelines. They can, of course, be sabotaged, but they also generally operate without a lot of manpower. In fact, oil pipelines were invented “in Pennsylvania in the 1860s to circumvent the wage demands of the teamsters transporting barrels of oil to the rail depot in horse-drawn wagons.”

The entire whole coal sector also tended to be located in one place. A coal plant was built next to a coal mine, and industries settled near the coal plant. In contrast, by the beginning of the 20th century, the oil sector was already international, and “by 1970 oil accounted for 60% of seaborne cargo worldwide.” Workers in the Middle East would hardly have been able to join forces with others in Europe. Mitchell concludes, “unlike the movement of coal, the flow of oil could not be readily assembled into a machine that enabled large numbers of people to exercise novel forms of political power.”

Workers sabotage coal, multinational firms sabotaged oil

Most history books would have us believe that Western oil firms quickly scouted the four corners of the earth, trying to claim rights to oil fields before their competitors could. That’s true, but they did so not to get the oil to the market quickly, but rather to prevent the competition from doing so first.

Mitchell argues that goal was protecting “the system of scarcity.” Over the 20th Century, multinational oil firms “collaborated to divide the world’s resources between themselves, and to limit production to maintain prices.”

He provides manifold examples. In Iraq, BP “deliberately drilled shallow wells to avoid discovering additional supplies.” Another an oil consortium “persuaded the US government to pressure independent oil companies not to take up any oil contracts offered by Iraq” until a separate dispute could be resolved “and meanwhile delayed settling the dispute.” Likewise, Deutsche Bank took nearly a quarter of a century to start production after receiving its first concession in Mesopotamia. “A principal reason for searching in the barren hills of Persia was not to launch the region’s oil industry, but to delay its development,” Mitchell explains.

The firms wanted to find oil before someone else did – and then keep it off the market, lest a glut ruin prices. Western politicians were sometimes complicit; at the beginning of the 20th Century, “the governors of Oklahoma and Texas declared martial law and sent the National Guard to… shut down the new wells, as a means of increasing the price” of oil.

The tactic worked. By 1960, as one economist calculated in 1970, oil firms were producing a barrel of oil for less than ten cents but selling it for nearly 80 cents – a profit margin of roughly 700%. One reason was the lack of transparency; even today, “apart from the British and Norwegian zones of the North Sea, there is no production region in the world for which field-by-field production data are publicly available.”

In the oil sector, multinational corporations, not workers, sabotaged supplies. Workers were divided into much different skill sets, locations, and even ethnic groups, as I will investigate in my next post.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

McJihad: how fossil fuel has shaped western democracies

14 August, 2017 - 15:00

In Carbon Democracy, Timothy Mitchell calls into question our simplistic notions of why there is democracy in some countries and not in others. He claims that vulnerabilities in the coal sector opened up opportunities for democracy to advance, but in the past hundred years the rise of oil sector was exploited to undercut it. Craig Morris has the details.

Coal strikes forced the powerful to listen to worker demands (Public Domain)

Published in 2011, Carbon Democracy by Egyptologist Timothy Mitchell is one of those rare nonfiction books you read all the others for – one that proposes radically new interpretations of the world and then justifies them convincingly.

The UK has successfully reduced its carbon emissions to a level not seen since the late 1800s. But the most salient part of this chart are the two dramatic dips in the 1920s. They were the result of strikes at coal mines, which threatened to cripple the British economy. (Source: Carbon Brief)

For instance, Mitchell says the recent fashion of dividing the world into “Jihad vs McWorld” is wrong; he proposes “McJihad.” The Arab world does not “hate” our values. Rather, our consumer culture – and hence, our democracies –  are based on the suppression of democracies in the Middle East, including fundamentalist Islam. Because our well-being is so dependent on fossil fuels, Mitchell speaks of “carbon democracy.”

He rejects the notion that Europe and North America naturally lean towards democracy because of some mindset: “Think of democracy not in terms of the history of an idea for the emergence of a social movement, but as the assembling of machines.”

“Democratization arises not because manufacturing allows workers to gather and share ideas… but because it can render the technical processes of producing concentrations of wealth dependent on the well-being of large numbers of people.”

Indeed, top thinkers in the West are hardly ardent supporters of democracy. Mitchell finds a lot of anti-democratic thought (or at least skepticism) in the Western world, from US political scientist Samuel Huntington’s talk about an “excess of democracy” in 1975 all the way back to the beginnings of oil exploration in territories Europe had colonized. At that time, Mitchell writes, “tolerant, educated, liberal political classes” in Europe were “opponents of democratization.”

In turn, he cites evidence that the colonized were less interested in being divided into the ethnic groups that Europeans wanted to categorize them in – such as Arabs or Turks – and “more concerned with collective well-being and economic survival.”

He finds that the coal sector was vulnerable to sabotage by workers starting in the first phase of industrialization. But in the 20th century, industrialists and politicians in the west used the rise of oil to push back popular demands. Mitchell argues that democracy requires “an effective way of forcing the powerful to listen,” and coal was better for that purpose than oil.

Take the British Navy’s switch from coal to oil around World War I under Lord Admiral Winston Churchill. Practically all accounts of Churchill’s decision focus on the benefits of using oil instead of coal (basically, more energy for the space required); see this example by US Senator John McCain, or Daniel Yergin’s Pulitzer Prize-winning The Prize. But Mitchell says one thing is almost always left out: labor strikes. 

Around that time, the British labor movement had succeeded – largely by means of strikes – in getting the first welfare policies adopted (unemployment benefits, disability insurance, healthcare, etc.). Parliament had cut back on military expenses to cover these services, and taxes on the rich had been increased. Churchill feared that strikes might compromise the military’s ability to maneuver, specifically because the Navy needed coal of the highest quality (anthracite). And the only place in the UK where this could be found was South Wales – exactly where strikes were taking place during the Great Unrest, when Churchill took over the Navy. “The general strike ‘policy’ is a factor which must be dealt with,” Mitchell quotes Churchill in the wake of strikes in 1911-12.

When war broke out in 1914, the British government appealed to workers’ patriotism to prevent crippling strikes. But after the war, coal miners and other workers vented their pent-up resentments in strikes that truly slowed down the economy – and vindicated Churchill’s decision to move from coal to oil for the Navy, the latter being harder for workers to sabotage. In my next post, we’ll see why the coal sector was more vulnerable to worker resistance. Surprisingly, it was the oil companies themselves that sabotaged the oil supply throughout the 20th Century.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

The Euratom Treaty: an outdated source to legitimize nuclear energy

11 August, 2017 - 15:00

Since the 1950s, the Euratom Treaty has encouraged large investments into nuclear energy projects and funding for nuclear research. In all this time, the treaty was never revised to suit present-day demands. The trend towards cheaper renewable energy is ignored, while millions of euros that go towards nuclear research are legitimated. Cordula Büsch takes a look at why the Euratom treaty needs to be reformed, if not abolished.

The Euratom Treaty is older than these towers – but unlike them, it’s still running (Photo by Ben Elias, edited, CC BY 3.0)

The Euratom Treaty aims to establish nuclear safety regulations for workers and the general public and ensure the supply of nuclear fuels and related materials across the European Union. Most importantly, however, Euratom intends to facilitate investment into nuclear energy installations by disseminating technical information and ensure the funding of nuclear research. When the treaty was signed as part of the ‘Treaties of Rome’ in 1957, it certainly hit a nerve at that point, since energy independence seemed to be threatened by a shortage of conventional energy sources in the EEC founding states. The peaceful use of nuclear energy seemed like a viable way to achieve energy security and the cooperation among the member states facilitated investment for such costly projects.

Once a founding pillar of the European Communities, Euratom has lost this special status since the Lisbon Treaty. So far, the EU member states have not found a common ground to reform or even abolish this relict from the 1950s. Since its implementation, the wording of the treaty has changed very little despite reform efforts back in 2004, which proved unsuccessful. Lacking democratic legitimacy due to the absence of public consultations and the limited role for the European Parliament in the decision-making processes, it is long overdue to change the existing structures of the treaty which enjoys the status of a separate legal entity.

Additionally, Euratom continues to praise the high importance of nuclear energy for energy security and affordability. Based on the major objectives stipulated in the Euratom Treaty, millions of euros are invested into nuclear energy research every year, in spite of a wide-spread, booming trend towards renewable energy.

In 2016, the budgetary implementation of the Euratom Framework Programme (2014-2018) – which invests into Euratom’s research and innovation programmes, fusion energy research as well as nuclear fission and radiation protection – amounted to approximately EUR 233.6 million. PINC, the Nuclear Illustrative Programme, is connected to Euratom and serves as a strategic document for estimating financial needs regarding nuclear power plants. The regularly commissioned paper continuously overestimates the relevance of nuclear power in future energy scenarios and envisions large replacements of the current nuclear power station fleet, while the immense costs are disregarded in the face of increasingly cheaper renewable alternatives.

The recent PINC 2016 estimated a total of EUR 650-760 billion investment requirement in the nuclear fuel cycle between 2015 and 2050. The programme assumes that there should be a replacement of the existing nuclear power capacity upon closure of old nuclear power plants. This is unrealistic considering the recent financial disasters such as Flamanville that have been ignored, as well as the trend of fewer operating plants and even fewer new constructions.

It is, thus, not surprising that the subsidies granted for the controversial Hinkley Point C project in England have found a base for legitimacy in Euratom. The much contested state aid worth several billion pounds was approved by the European Commission in 2014 and has paved the way for the final investment decision from the French firm EDF. The British government agreed to the construction of the first nuclear power plant in 20 years in the UK and signed final contracts with EDF in September last year.

In the light of the declining costs of renewable energy and the ever increasing costs of nuclear, Hinkley Point C is not attractive from a consumer-perspective.

Still, the parties involved advertise the project as a step towards meeting clean energy targets, as a job creator for 25,000 people and a tool to attract investment for the UK, especially since the Chinese government will take a one-third share of the costs. As the Brexit process has been going forward, the project might even been seen as ‘a tool to take back control’.

The Brexit, furthermore, creates a new situation for the European Union and Euratom alike, as it will be the first time that a country would leave the Treaty rather than joining it. The British Prime Minister Theresa May has explicitly mentioned in her letter to the EU Council which officially triggered article 50 in March that the UK will leave the Euratom treaty, despite Euratom membership not being connected to EU membership.

Perhaps this can be taken as an opportunity, a wake-up call, to finally discuss the dissolving of Euratom altogether. Just like the Brexit negotiations, this will bear many challenges and open questions, such as the future of the long-term ITER project to build a fusion reactor. In 2012-2013 Euratom funded the ITER project with the substantial amount of EUR 2.2 billion. Nonetheless, it should be a necessity to discuss the future of Euratom, especially now at a time when demands to reform the EU are voiced by the remaining 27 members.

The current trend shows that more European countries are thriving to shut down their nuclear power plants. There are also more countries without nuclear power plants among the EU27 than those keeping up their support of nuclear energy. With Belgium and Germany joining the group of countries without nuclear power plants within the next 8 years, this group will entail 15 member states. The support for nuclear energy is steadily shrinking and with the UK, a nuclear power nation is soon leaving the EU, which changes proportionalities within the union. Even France has issued the Energy Transition for Green Growth bill preparing to cut down nuclear energy to 50% by 2025.

Still, as there are no dedicated contributions towards Euratom from each nuclear power state, every country indirectly contributes to nuclear research through the general EU budget. This is not in the interest of countries such as Austria and Germany, where opinions against Euratom and nuclear energy have been publicly raised in several protests.

Keeping up the status quo will leave the EU vulnerable to even more allegations targeted towards its “undemocratic” character. It would make sense to incorporate the provisions for Euratom into the Lisbon Treaty as well as clarify the relationship between Euratom and the EU institutions and in order to close the democratic gaps. At the same time, a common approach towards nuclear research and energy, ideally envisioning a large-scale nuclear phase-out, should be sought after.

Cordula Büsch has carried out extensive research on Euratom and is currently completing her MA degree in Political Science/ Area Studies at the University of Rostock.

Categories: Blogs

Privatization of public services is failing, says think tank

10 August, 2017 - 15:30

There’s a global movement of communities and cities taking back control of their energy and water supply, and Germany’s Energiewende serves as a role model. Craig Morris takes a look at the Transnational Institute (TNI)’s report, “Reclaiming public services: how cities and citizens are turning back privatization.”

Germany dominates re-municipalization in the energy sector. Pictured here, the initiative “Neue Energie für Berlin” (Photo via Wikipedia Commons, edited, CC BY-SA 3.01)

In the 1990s, communism was dead, and privatization was in fashion. Across the world, policymakers and business leaders assured the public that companies could provide basic utility services of better quality and at a lower cost. Many of these commissions were granted for 20 years, and a lot of municipalities are now deciding not to renew contracts with private-sector service providers but instead to take things back into their own hands.

TNI’s new report (also available in French and Spanish) explicitly advises municipalities to use that planning horizon to make preparations:

It is quite strategic for cities to spend a few years to prepare the transition while waiting for private sector contracts to expire. In 20 per cent of cases (134), private contracts were terminated during the contract period, which is much harder and generally conflictual.

In some cases, however, quick action is taken because an immediate response is needed (for example, the re-nationalization of Japan’s nuclear reactor operator TEPCO). Other re-nationalizations took place in Latin America in sectors ranging from pension funds to postal services and air transport. What all of these events have in common with municipal ownership is a focus on public welfare and democratic control when the focus on profits in the private sector lead to undesirable outcomes. Indeed, as the list of motivations shown below shows, the main driver in Latin America was discontent with the services provided by companies:

The report covers 835 examples of (re)municipalization of public services globally since 2000. An astonishing 347 of them are in Germany alone, 284 of which are related to energy.

Privatisation is failing. This is the alternative: People taking #PublicServices back into public hands https://t.co/9NUd9U9lrk pic.twitter.com/jZxrrLEjsG

— TNI (@TNInstitute) June 23, 2017

In France, the issue has largely been water supply. When the capital city of Paris decided to take back its water services, it set an example that other French cities have followed. According to Reuters, a report found that French cities “with the cheapest water rates were nearly all run by public bodies, while those with the most expensive were mainly run by” private firms.

The chart also shows, however, that Germany by far dominates re-municipalization in the energy sector. The most famous example is Hamburg, a city of some 1.5 million. In 2013, its citizens voted to take back the power grid from Danish giant Dong Energy. A similar campaign initially failed in Berlin later the same year; however, that issue has not yet been completely resolved.

Overall, the study finds that remunicipalization is far more widespread than commonly known, and it is increasingly a local response to austerity. The study argues that local ownership is often a better solution than privatization. In South America, for instance, a wide range of public services have been returned to municipal control, as the chart below shows. Argentina has seen the strongest trend towards municipal ownership, which is perhaps not surprising; after all, the country suffered a financial crisis in 2002 and was cut off from international capital markets as a result until 2016.

A study published in 2016 by German economics institute DIW came to more nuanced findings for municipal utilities in Germany. They found no significant difference in economic efficiency. Instead, there was a big difference in goals: private-sector firms focus on profits for shareholders, whereas municipal utilities try to provide better-quality services and return the profits to the municipal budget. In other words, the difference is between benefits for shareholders and benefits for stakeholders.

This reasoning is the same for campaigners in Germany. One of the people spearheading the attempt to take back Berlin’s grid recently told me that his group does not claim that they will be able to provide better services; in fact, they would basically hire the same people. What they want is for profits to be returned to citizens of Berlin rather than sent off to Sweden, where Vattenfall has its headquarters.

The Transnational Institute was founded in the 1960s in the United States to promote peace but soon moved to Amsterdam and begin focusing on global justice, especially in terms of finance. The TNI’s Board President is Susan George, a prominent critic of neoliberal globalization in the past few decades.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

The coal fee

9 August, 2017 - 15:00

Polish coal is losing value on the global market and Poland’s grid may see serious blackouts. But instead of investing in other forms of energy, the government dips into taxpayer pockets to try and save the mining and energy market. Michał Olszewski takes a look.

Taxpayers are going to have to pay for dirty energy (Photo by Ruth Hartnup, edited, CC BY-SA 2.0)

An energy market bill is being rushed through the Polish Parliament. It aims mainly to avoid a catastrophe in the energy and mining sectors, which are desperately seeking money for new investments.

Why the need? Current installed capacity stands at about 36 GW, while estimates predict a growth in Poland’s energy demand. Meanwhile, Poland’s electrical power industry is in a poor state. Age metrics aren’t everything, of course – half of all equipment in the Polish industry is more than 30 years old, but a large part of that has undergone various forms of modernisation.

However, the problem is that, despite the best of efforts, the facilities are far less efficient than their modern equivalents. The average Polish energy unit has an efficiency of barely 37 per cent, while modern equipment rates at least 5 per cent higher on this scale. As Konrad Świrski, author of a blog on Polish energetics, writes, it can be compared to the restored old-timers and road cruisers which can sometimes be seen at car shows. “So we are left with models which produce electricity, but not as effectively or economically as new installations would.”

Studies by the Polish Power Grid (the owner of Poland’s high-voltage network) anticipate that, in 2013–2020, units of a combined power of about 6,600 MW will be de-commissioned, the lion’s share of which (about 5,000 MW) will be in major power plants. Meanwhile, by 2028, units of a total capacity of 10,000 MW will need to be taken out of service.

The worst-case scenario sees power shortages in Poland in as early as 2021. In 5 years’ time tighter EU law provisions, which some Polish power units do not conform to, will come into effect. The new norms will tighten emission standards not only for carbon dioxide, but also for nitrogen oxides, sulphur and particulate matter.

Is the Polish electrical power industry prepared for these changes? Despite billions of euros received from the EU in aid to modernise the sector, the response does not look good. This is because the stream of cash was pumped exclusively into modernising old, coal-fired power units. For the 13 years since Poland entered the European Union, the development of renewable energy sources has met with huge opposition from politicians, the mining lobby and the electrical power industry, which considers diversification a threat.

The scale of the problem is demonstrated by a report published in June by the Supreme Audit Office, which analysed expenditures on mining in the years 2007–2015. The document makes for painful reading – in that period the national budget devoted 66 billion zloty to supporting mining, of which 58 billion was spent on retirement severances and pay rises. In the same period, mine profitability has not increased. When the global market price of coal began to fall in 2013, the industry found itself in deep crisis, the only solution to which seems to be financial drip-feeding.

Because time is pressing, and the spectre of blackouts looms ever-larger (interestingly, not in winter, but in summer, when the heat and droughts crank up energy demand), politicians are looking for money. Hence the idea to add a compulsory fixed tax to each electricity bill. The energy market bill drafted by the Ministry of Energy imposes a fee on energy consumers, for both domestic and business use. The MoE estimates that the fees will total 27 billion zloty over the next 10 years. Over half of that will come from small and medium-sized businesses. Additionally, households will be charged a flat fee, probably of about 90 zloty per year.

And how will the funds be used? To build new coal-fired power units and new coal mines. Significantly, Polish coal reserves will last for about 30 years, leading to a paradox. The Polish energy minister’s arguments for the need to impose the new fee and maintain the current structure of the energy mix include “tradition” and the desire for energy independence. Except that, in the long term, coal-based energy reduces this independence. Already, the raw materials are partly imported. It can therefore be assumed that, three decades from now, Polish energy will rely on Siberian coal, which for now is cheap and of very good quality.

Will the fee save the Polish energy industry? Much depends on the EU. If it decides that the fee is an impermissible form of public subsidisation and cuts the companies off from this cash drip, they may find themselves in a dramatic situation. Ireneusz Sudak, a journalist specialising in energetics at “Gazeta Wyborcza”, asks what will happen if the companies take out loans to build new investments and the fee is then determined to be illegal. The energy companies will be left without money and will turn to the National Treasury for help.

One way or another, the consumer will pay. So, this dramatic attempt to seek out additional money for the energy industry will not solve any problems; it is a further attempt to put them off until another day.

Michał Olszewski (born 1977) – journalist, reporter, writer. For more than twelve years he worked for Gazeta Wyborcza and Tygodnik Powszechny, where he concentrated mostly on environmental issues. He is engaged in a Krakow-based campaign against air pollution.

Categories: Blogs

4 Reasons Nuclear and Fossil Fuel Supporters Criticizing 100% Renewable Energy Plan Are Wrong

8 August, 2017 - 15:00

Proponents of 100% renewable energy face harsh criticism, even well-respected scientists like Mark Jacobson. He has been arguing for countries to switch to an all-renewables grid for years, both through academic papers and activism. Today, he rebuts the argument that the US should continue using nuclear power and fossil fuels.

100% of our power could be renewable, says Mark Jacobson. So what are we waiting for? (Public Domain)

PNAS published a paper by nuclear and fossil fuel supporters, which is replete with false information for the sole purpose of criticizing a 2015 paper colleagues and I published in the same journal on the potential for the U.S. grid to stay stable at low cost with 100 percent renewable wind, water and solar power. The journal also published our response to the paper.

The main arguments made by the authors, most of whom have a history of advocacy, employment, research or consulting in nuclear power, fossil fuels or carbon capture, are that:

1. we should have included nuclear power, fossil fuels with carbon capture (CCS) and biofuels as part of our mix because those technologies would lower costs;

2. it will be too hard to scale up several of the technologies we propose; and

3. our modeling contained errors.

The paper is dangerous because virtually every sentence in it is inaccurate, but most people don’t have time to check the facts. To that end, we include an additional line-by-line response to the paper.

Here are summaries of our main responses to the “Clack” paper:

1. To Clack’s claim that nuclear, fossils with carbon capture and biofuels reduce costs of decarbonization, the Intergovernmental Panel on Climate Change (IPCC) concludes the exact opposite (Section 7.8.2):

“Without support from governments, investments in new nuclear power plants are currently generally not economically attractive within liberalized markets, …”

Similarly, even strong nuclear advocates disagree:

” … there is virtually no history of nuclear construction under the economic and institutional circumstances that prevail throughout much of Europe and the United States.”

Next, an independent assessment of our 100 percent wind, water and solar plans versus nuclear and CCS options concludes:

“Neither fossil fuels with CCS or nuclear power enters the least-cost, low-carbon portfolio.”

Even Christopher Clack, CEO of Vibrant Clean Energy, doesn’t believe his own abstract. He tweeted: “Completely agree that CCS are too expensive currently …”

Completely agree that #CCS are too expensive currently and we need new technologies to assist with decarbonization. What can we use instead? https://t.co/PT568dz7H0

— Christopher Clack (@clacky007) May 6, 2017

Clack claiming nuclear and carbon capture are inexpensive is based on outdated, minority studies that (a) underestimate their high costs; (b) ignore the 10-19 year lag time between planning and operation of a nuclear plant versus 2-5 years for a typical wind or solar farm; (c) ignore the cost of the 25 percent higher air pollution due to the 25 percent additional energy thus 25 percent more fossil fuel mining, transport and combustion needed to run carbon capture equipment; (d) ignore the climate cost of the 50 times higher carbon emissions of fossil fuels with carbon capture relative to wind per unit energy; and (e) ignore the “robust evidence” and “high agreement” by the IPCC of weapons proliferation, meltdown, mining and waste risks associated with nuclear power. They also ignore the air pollution, carbon emissions and land use issues associated with large-scale biofuels.

As part of their argument Clack further ignores more than a dozen other published studies that have examined high penetrations of renewables in the electric power sector without nuclear or carbon capture, as referencedhere, falsely implying that ours is the only one.

2. To Clack’s claim that we propose technologies that can’t be scaled up, we disagree. Underground thermal energy storage in rocks is a well tested (in multiple locations) and established low-cost seasonal heat-storage technology that costs less than 1/300th that of batteries per unit energy stored. It is a form of district heating, which is already used worldwide (e.g., 60 percent of Denmark). Moreover, hot water storage or electric heat pumps can substitute for underground thermal energy storage.

Clack also criticizes our proposal to use some hydrogen, but hydrogen fuel cells already exist and the process of producing hydrogen from electricity was discovered in 1838. Its scale-up is much easier than for nuclear or CCS. With respect to aircraft, the space shuttle was propelled to space on hydrogen combustion, a 1,500-km-range, 4-seat hydrogen fuel cell plane already exists, several companies are now designing electric-only planes for up to 1,500 km, and we propose aircraft conversion only by 2035-2040.

Clack further questions whether industrial demand is subject to demand response, yet the National Academies of Sciences review states: “Demand response can be a lucrative enterprise for industrial customers.”

3. To Clack’s claim that we made modeling errors, this is absolutely false, as indicated in each specific published response. Most notably, Clack claims that we erred because our peak instantaneous hydropower load discharge rate exceeded our maximum possible annual-average discharge rate. But Clack is wrong because averages mathematically include values higher and lower than the average. Clack made other similar mathematical errors.

More importantly, it was made clear to Clack by email on Feb. 29, 2016, that turbines were assumed added to existing hydropower reservoirs to increase their peak instantaneous discharge rate without increasing their annual energy consumption or the number of dams, a solution not previously considered. It was also made clear that it was alternatively possible to increase the discharge rate of CSP, or concentrating solar power, rather than hydropower. Increasing hydropower’s peak instantaneous discharge rate was not a “modeling mistake” but an assumption.

Despite having full knowledge in writing, not only in 2016 but also weeks prior to the publication of their article, that this was an assumption, Clack and coauthors made the intentionally false claim in their paper that it was an error. The fact that Clack (twice) and all his coauthors (once) were informed in writing about a factual assumption, but intentionally mischaracterized it as a mistake, then further falsely pretended the numbers resulted in mathematical errors when they knew there were none, speaks to the integrity and motivation of the Clack et al. authors.

4. Clack falsely claims that the 3-D climate model, GATOR-GCMOM, that we used “has never been adequately evaluated,” despite it taking part in 11 published multi-model inter-comparisons and 20 published evaluations against wind, solar and other data. And, despite Zhang’s 2008 Atmospheric Physics and Chemistry Journal comprehensive review that concluded GATOR-GCMOM is “the first fully-coupled online model in the history that accounts for all major feedbacks among major atmospheric processes based on first principles” and hundreds of processes in it still not in any other model.

In sum, Clack’s analysis is riddled with intentional misinformation and has no impact on the conclusions of our 2015 grid integration study, namely that the U.S. grid can remain stable at low cost upon electrification of all energy sectors and provision of the electricity by 100 percent wind, water and solar power combined with low-cost electricity, heat, cold and hydrogen storage and demand response.

This article was originally published at Ecowatch.com.

Mark Jacobson is professor of civil and environmental engineering at Stanford University and director of its Atmosphere and Energy Program.

Categories: Blogs

Why no one seems happy with 96% citizen wind power

7 August, 2017 - 15:00

Germany has held its first auctions for onshore wind farms, and the projects that fit the brand-new definition of “citizen wind power” got almost all of the volume. So why do most people seem so unhappy? Craig Morris investigates.

‘Citizen cooperatives’ may be front organizations for private-sector developers who want special treatment (Public Domain)

Rainer Baake’s job isn’t an easy one. Last year, the German Energiewende Undersecretary told the audience at the annual conference of German energy cooperatives (DGRV) that they would have to take part in onshore wind auctions like everyone else starting this year. The cooperatives wanted to be able to participate as “non-competitive bidders,” meaning that they could go ahead with their projects at whatever price was determined in the auction. Baake rejected the proposal.

But the cooperatives did not give up, and early this year Baake’s ministry announced a compromise (report in German) – one that included a new definition of citizen wind projects:

  • At least 10 citizens must be involved, none of whom own up more than 10% of the project.
  • The citizens must, however, owned at least half of the shares.
  • And at least half of the citizens must live in the county where the wind farm will be built.

In return, the citizen projects do not need an environmental impact assessment (EIA, or BImSchV permit in German) to participate in the auctions. An EIA can be quite expensive and is by no means a foregone conclusion.

In addition to the risk of not getting the permit, citizen projects feared that their bids might not win, leaving them sitting on six-figure losses. It is generally assumed that bigger companies will participate in multiple rounds of auctions and probably make several bids in each round, so economic losses from losing bids can be spread around. In contrast, the prospect of losing everything in a bid might scare citizens away from the outset, and once they have lost they might never participate again.

In March, Germany’s Network Agency (the grid regulator that conducts the auctions) announced what seemed to be a success for citizen wind power (press release in German). Prices were very low at 5.58-5.78 cents, and citizen projects got almost the entire volume. And then the complaining began.

Winning bids were concentrated mainly in the North in Germany’s first round of onshore wind auctions – even though lots of bids came from the areas in white. The numbers show how many turbines are to be built (WEA = wind turbine). Source: Deutsche Windguard.

First, there were nonetheless a lot of losers. Out of 2,137 MW submitted, only 807 MW can be built. There were 256 bids, 71% of which were citizen projects in terms of volume. 65 citizen projects can proceed, but around 100 lost – along with almost all private-sector bidders.

Then, there are the long timeframes: the citizen projects have a whopping 54 months – 4 ½ years – to complete their wind farms, instead of only 30 months. (Wind farms can usually be built within 24 months.) It is likely that none of these citizen projects will be built quickly, so the German onshore wind market could dry up from 2018-2020. Furthermore, 95% of the citizen projects still lacked an EIA, which the winners now have to produce – and that could fail.

Finally, the definition of “citizen projects” met with criticism from the outset – these are not proper cooperatives. When the results were announced, Rene Mono of the Citizen Energy Alliance called for an investigation into whether “all of the companies that complied with the definition of citizen projects have what is needed for community energy: democracy, codetermination, and input from local people” (report in German). In cooperatives, each member has a single vote regardless of how many shares they hold.

German economics daily Handelsblatt then investigated the matter (in German behind a pay wall) and found evidence that the local citizens in many of the projects seem to be employees of the companies. In other words, a lot of the citizen projects seem to be front organizations for private-sector developers who wanted to benefit from the special treatment for citizens. German wind energy organization BWE wanted to have the minimum number of citizens increased to 50 to prevent such abuse, but their proposal was not adopted (report in German).

In the end, we have some amazing headlines: record low prices, and it’s citizen energy! But the reality could be sobering. Unless the legal framework is changed, the business world has to cobble together some citizen lackeys if they want to win bids. And in the next few years, feed-in tariffs will expire for large volumes of wind capacity built 20 years ago. It’s possible that the amount added in the next few years will be smaller than the amount dismantled. The German wind power sector will then be treading water. And Baake, who is bathing in sunlight now, might face stark criticism again.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

Why Volvo going ‘all-electric’ is not as revolutionary as it seems

3 August, 2017 - 16:19

Volvo’s shift towards electric vehicles is not likely to signal the end of combustion engines. Only some serious investments in infrastructure can do that; but in the meantime, hybrid and hydrogen-powered vehicles are still relevant, says Jim Saker.

We have the technology – now we just need to build the infrastructure. (Photo via the Conversation)

The announcement from Volvo that all of its new models from 2019 will include an element of electric vehicle technology was a PR coup for the Swedish car maker. It received a disproportionate amount of attention as the “first major car company” to switch to all-electric. But the statement by their CEO Hakan Samuelson that this “marks the end of the solely combustion engine powered car” is more a reflection of Volvo’s position in the market than any justification of a global change.

Volvo, known for decades for its safety, has fallen behind other manufacturers when it comes to environmental credentials. It recently introduced hybrid versions of the XC90, XC60, S90 and V90. But let’s not forget that Toyota introduced the mass-produced hybrid, its Prius, worldwide in the year 2000. Toyota now have around 80% of the global market for hybrid vehicles.

The question we should be asking is why Toyota or any of the other mainstream manufacturers have not come out with the same proposition to end the role of solely combustion engine powered cars? The answer lies in the fact that the major part of Volvo’s sales take place in Europe, the US and China. These markets have the potential to have the basic infrastructure in place that’s needed to support the electrification of vehicles.

Other manufacturers have a more global perspective and appreciate that in parts of the world such as Africa and parts of South America the idea of a regular supply of electricity for basic needs is of more pressing concern than the facility to plug in an electric vehicle. To some extent this position is really an admission that Volvo has limited expansion plans in developing markets and is happy to concentrate in its more established countries. A cynic might also suggest that the move helps the company meet the new more stringent EU emissions targets that are due to be introduced over the next few years.

Hybrid vehicles, by their very nature, require two power sources. One is a small, usually petrol-fuelled engine that charges the battery that drives the car. There are also more sophisticated developments that involve charging the battery while the car brakes but these are usually supplementary to the main form of electricity generation. Volvo’s claim gives the impression that petrol engines are a thing of the past when, with the current technology, they are still a critical part in the hybrid system.

New infrastructure

For car companies there is at least one major issue with a truly and entirely electric future. This prospect would mean that for the first time it would be those providing the infrastructure that would dictate what was happening in the motor industry.

Electric vehicles work well when the driver can charge the vehicle on a regular and convenient basis, usually overnight. This is fine if you have a driveway and a power source available. If, however, you live in a block of flats or in a terraced property there is a major issue. Battery life and access to a charging point add barriers in potential customers’ minds over the purchase of an electric vehicle. This makes the hybrid alternative a much more attractive proposition for all the major manufacturers who have or are in the process of developing hybrid models.

More charge points for EVs are needed (Shutterstock.com).

Volvo’s announcement also steals the show from perhaps the most interesting discussion about the future of cars. That’s whether or not hydrogen-powered vehicles will dominate the market – either as part of a hybrid system or as a fully hydrogen-powered fuel cell engine. There is only the Toyota Mirai available in a few developed markets and only 3,000 have been sold globally. The reason: a serious shortage of refuelling stations.

The emissions from these vehicles is water and they are claimed to be environmentally neutral. Toyota and Hyundai have made major advances in this area but face the bigger problem of building the infrastructure to refuel hydrogen-powered cars. The installation of refuelling stations would require significant investment.

So, despite Volvo’s claims, the future of motoring will undoubtedly still include a petrol engine in some format in the immediate future. The only way that this is likely to change is if governments divert their infrastructure spending away from rail into opening up greener alternatives for drivers. This would improve the environment while still allowing the mobility that a car gives to people in everyday use. Even with car ownership declining in some cities, something will have to power the buses and taxis – and the cleaner that can be, the better for all.

Jim Saker is Director of the Centre for Automotive Management, School of Business and Economics, Loughborough University

This article was originally published at The Conversation.

Categories: Blogs

Germany has surpassed its 2020 target for green power

2 August, 2017 - 15:00

By 2020, Germany aims to get 35% of its power demand from renewables, but the share was much higher in the first half of this year. But there’s also some bad news. Craig Morris explains.

Wind and solar have made great strides – but new policy may stop them cold (Public Domain).

At the beginning of July, Fraunhofer ISE’s website showed that Germany had 37.6% renewable power in the first half of the year – far above the goal of 35%.

The share of renewables is even larger when we consider power demand, i.e. take out net power exports; the chart above shows generation, not just demand – and Germany became Europe’s leading power exporter last year. To explain this, I’d like to introduce you to a new platform currently only online in German: Smard. Like the Agorameter, it shows net commercial power trading. Germany exported 29.8 TWh net, equivalent to 11 percent of total generation, which we can subtract from the total above for all power generation including exports. Renewables then made up 42% of power demand in Germany.

The Network Agency’s new Smard website is pretty powerful (if you can navigate the German) but could use some tweaking for readability. Here, the bars above the baseline show power exports by country; those below the baseline, power imports. The black line is the net result, which varied from a high of 6.2 TWh in January to a low of 4.0 TWh in May. (Source: Smard.)

These figures are still preliminary, but any adjustments are unlikely to be great. The biggest variable is the weather. The first half of 2017 was both fairly sunny and windy. But it will be hard to drag the share of renewables back down below 35%.

The Agorameter also shows commercial power trading and is available in English. Unlike Smard, it does not let you access raw data. Here, we see that Germany was a net power exporter (line) every day of 2017 up to now. (Source: Agora Energiewende)

Solar continues to creep upwards, but the main growth has come from wind power. In the first half of 2016, solar and wind collectively generated 58 TWh, but that figure rose to 68 TWh in the first two quarters of this year. Wind power made up most of that 10 TWh increase at 7.5 TWh.

One reason has been the recent record expansion of wind farms. In the past few years, wind projects have rushed to finish before auctions take effect. Under auctions, the government will be able to decide which projects can be built; effectively, the government can tell developers they cannot build simply by keeping the volume auctioned at a modest level. (The first round of onshore wind auctions was more than 1.5-fold oversubscribed, meaning that there were 1.5 losers for every winner.) Under feed-in tariffs, the government had no way of stopping projects based on volume. The result was more than 4 GW of capacity additions annually for the past three years after a decade of closer to 2 GW each year.

In contrast, large PV arrays (the size limit is now 750 kW) have had to take part in auctions for the past two years. Since then, new builds have failed to meet the government’s minimum target of 1.5 GW annually.

So what will the share be by 2020? It might not be much higher at all. A lot of wind turbines will leave the feed-in tariff scheme in the next few years after 20 years of eligibility. Those wind farms could theoretically still sell power at the wholesale rate, but that price might be lower than operating costs, especially if any maintenance is needed for the old turbines. Many machines will thus be dismantled.

In addition to this reduction, which will be significant for the first time (not much had been built more than 20 years ago), the auctions also allow projects several years to develop: from 30 to 54 months. The volume awarded this year – already relatively small at 2.8 GW (source in German) – is thus unlikely to be built in 2018 or 2019. Most projects from the first round have until 2022.

So whatever share of renewables Germany has for 2017 as a whole will probably be close to the percentage it will have in 2020. The good news is that the target for that year will probably be reached. The bad news is that solar continues to be developed at a meagre pace, and now the wind sector is bracing for an extended dry spell.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

The reality of environmental protection in Poland

31 July, 2017 - 15:00

The political changes in Poland have claimed ecology as another victim. For conservative politicians, ecology is just a dangerous whim and they would very happily spend the money allocated to it elsewhere. Michał Olszewski takes a critical look.

Polish forests – and polish citizens – are in danger from the right’s short-sighted environmental policy (Photo by Jacek Karczmarz, edited, CC BY-SA 2.0)

For the Polish Right (both the politicians and the publicists who support them) environmental protection is the unwanted offspring of the democratic transformation. For as long as I can remember, conservatives have been very energetic in their opposition to decarbonisation, brandishing their tired-out arguments about the national economy, sentimental justifications or references to real improvements in environmental conditions in other areas. They have treated climate change as the invention of western lobbyists. Ultimately, one can even take environmental protection as a sign of madness, as the chairman of the Polish ruling party PiS, Jarosław Kaczyński, did in one interview.

Dirty air: Warsaw vs Brussels

After the Right took power, that rhetoric took on material form. The evidence is endless: a month ago the Minister for the Environment Jan Szyszko took the European Parliament to the European Court of Justice. The reason? Pollution emission standards are, according to Szyszko, excessive, and Poland has no intention of adopting them. Poland is a country in which winter brings some of Europe’s highest levels of smog. The country suffocates in a cocktail of particulate matter, carcinogenic benzo[a]pyrene, and nitrogen and sulphur compounds.

The fight for clean air has powerful opponents – mainly the mining lobby, which sells minimum-quality coal to Polish households. Added to that is the reluctance of politicians who believe that it is better to have terrible air and a market for failing mines than clean air and protesting miners. Local solutions do not help because they are not accompanied by systemic activities, which not only the PiS government fears. The Civic Platform (PO) government was also for years in no hurry to adopt any such activities.

As a result, there are winter months in which cities and mountain spa towns experience smog levels on par with those of Beijing. The case in the ECJ means that, instead of working on solving the smog problem, the government wants Brussels to retract its anti-smog policy. It is also doing this at a time when European operations are picking up the pace and there are consequences for those not taking up the fight against smog. Meanwhile, the Polish government is making a clear declaration that it will not be fighting smog. This is an attempt to halt the development, scientific research and local community efforts which were the vanguard of the fight against smog and which had expected the support of the state.

Moreover, Jan Szyszko has perpetuated the view of Poland abroad as a country that prefers to be wreathed in toxic smoke than to try to clear the air. It is a risky business that Poland may now be seen not only as a country detached from the EU politically, but also socially and in terms of health policy.

It is worth noting as an aside that with this decision, the minister has opened up another front in the fight against Brussels. For years Poland has failed to meet EU air quality requirements and ignored calls from Brussels. If Warsaw declares war on Brussels over smog, it will mean that smog has poisoned its ability to think clearly. Thus far, the Union has treated Poland lightly, but now it will try to enforce the meeting of obligations, or impose a gigantic fine on Warsaw.

The thorn in the forester’s side

The Białowieża Forest is another matter. In one of the most valuable lowland forests in Europe, mass fellings are taking place. The environment minister decided that the bark beetle plague supposedly killing the forest requires radical action. He has also banned tourists from entering the forest: it appears that there are so many dead trees that they might fall on hikers’ heads. Ecologists believe that it is a pretext to prevent outsiders from witnessing the effects of the fellings.

This game is nothing more than an attempt to show who is in control in the Białowieża Forest. The State Forests are a huge business, and even if they agreed to provide legal protection to the entire forest, their budget would not suffer. Escalation of the conflict seems unavoidable: as this text was being finalised, environmentalists had started a blockade of one of the fellings. The reasons for this opposition are not material, since the income from the Białowieża Forest is only a fraction of the huge budget of the State Forests. It is all about showing that, in Polish forests, it is the foresters who are in control.

Redistributing funds for coal

An equally current matter is that of the attack on regional environmental funds. They currently fall under the jurisdiction of local authorities, who spend the money on lowering emissions, rational water management and sewage. The Right is preparing an environmental protection bill for a law that would allow the government to take over a sum of €2.5 billion per year. Where will that money go? One can only speculate that they will be used to a lesser degree than they are currently to fund programmes for the elimination of obsolete coal boilers. After all, the present government is doing all it can to protect miners and the mining industry.

One spectacular example of the distrust of any energy other than coal is the stagnation in the Polish renewable energy sector. Despite the fact that installation costs are falling globally, and wind, water and biomass energy are on their way, Poland has decided to go in the opposite direction. PiS deputies have limited the possibilities to build wind turbines, drawing the immediate attention of the sector, which withdrew from plans for major investments. Activity in the solar industry also died: last year saw the installation of barely 28 MW in photovoltaics!

This list is incomplete, but it does emphatically show how quickly things can regress, even in a domain so seemingly obvious as environmental protection. The actions of right-wing politicians are destroying not only the constructs that have been built in Poland over the past 27 years, but they are also having a measurable impact on citizens’ health.

An exaggeration? Ask the Polish environment minister, who thinks the problem of smog is “theoretical.”

Categories: Blogs

People want fewer cars in cities. Not everyone knows it yet.

26 July, 2017 - 15:00

Whenever we talk about getting cities back from cars, there’s pushback. Don’t people love their cars? Don’t we have cities built for cars because that’s what people wanted? Not exactly. Today, Craig Morris takes a look at the German town of Freiburg, and how citizens are taking their streets back.

Jakarta goes car-free once a month – but imagine the quality of life if the streets were always like this! (Photo by Gunawan Kartapranata, edited, CC BY-SA 3.0)

In 1871, Bismarck’s newly united Germany defeated the French in a short war. Monuments celebrating this victory went up across the country. Freiburg erected one, too, at a major intersection along the northern edge of the historic center of town. The monument survived both world wars unscathed. But the city filled up with cars in the 1950s and 1960s, so the monument was moved 100 m away, where it stood for half a century – unvisited on the edge of a parking lot, where drivers of city buses park to take a break. Two world wars couldn’t change the monument, but city planners did not hesitate to get it out of the way for cars.

The “Victory Monument” (Siegesdenkmal) in Freiburg in its original location, back when streets belonged to people. (Public Domain)

When I moved to Freiburg in 1992, the city had just banned cars from the city center. But you could still see how cars had been given priority over people. To get from the university buildings to the library, for instance, you had to cross a footbridge over a four-lane road – there was no crosswalk on ground level at all at a place where thousands of students had to cross the road daily! Further down that road, there was a tunnel where people walked into the historic center from central station. People thus had to go up and down stairs at various places in town so that cars could pass uninhibited by pesky pedestrians.

I could continue with examples just from Freiburg, but you get the point. (If not, take a look at what Le Corbusier wanted to do to Paris in the 1920s.) Most Germans think that their cities were rebuilt without numerous historic buildings, but in fact the restructuring of historic urban patterns to accommodate cars after the war destroyed more of these structures than the war did.

This video from 1970, one of the last years of car-centric planning in Freiburg, starts off with a view no Freiburger would begin with today: the autobahn. We then see high-rise apartments (praised as modern) on the edge of town, but they quickly became a ghetto; no one wanted to live there. The wording at 0.50 is telling: “Freiburg doesn’t look like it does on tourist postcards: modern, spacious, and not 850 years old at all.” That was meant as a compliment back then, but the experts were wrong: people didn’t want a car-centric Freiburg.

Visit Berlin, and you’ll notice there are only trams in the (former communist) eastern parts of town. In the west, the trams were removed in 1967 to make more space for cars (video). Cars were synonymous with progress – but only for decision-makers. People protested many of these changes, but the public was not held to be knowledgeable enough to have a say. People could vote, but no parties opposed redesigning cities for cars. So that was that.

It was no different in the US. People used to own the streets: they could stand in them, kids could play in them, and you could cross them whenever and wherever you wanted – just like you can in pedestrian zones today. In the 1920s, US carmakers responded to public outrage about cars endangering people (see, people didn’t want them!) by coining the term “jaywalking” (meaning “walking like a country hick in the city”). Policymakers then began fining people for getting in the way of cars. Small sections of public space were carved out for people. Cars got most of the space.

Cities feel a lot less welcoming when you highlight the places pedestrians aren’t supposed to go like this. pic.twitter.com/5cq78PuzgE

— Michael Farrell (@mikefarrell) November 12, 2014

Freiburg has since made that four-lane road between the library and university a pedestrian zone. The footbridge is gone. The pedestrian tunnels in town have been closed. People walk on the streets now; cars have to stop for them. On the map below, the triangles with exclamation marks show where that old thoroughfare has been turned entirely into a sidewalk.

Freiburg's ped zone (beige roads) huge and expanding to left @Sustainable2050 @udlondon @Jon_events @drvox pic.twitter.com/CnTvGujDrn

— Craig Morris (@PPchef) May 16, 2015

And the Victory Monument? It’s being moved back to its original spot at the end of a pedestrian street. But what sense does it make, you might be asking, for a monument celebrating a war to be made more visible? Freiburgers are asking that, too (in German). But the German debate is more civil than the violent US one over Confederate monuments. Some want the Freiburg monument melted to create a new monument for peace. Others say it should be left as-is to mark that moment in history, but new plaques or QR codes could be added explaining what it all means.

Whatever happens, the decision will be based on a democratic debate. The Energiewende has made German politicians more responsive to public will over the past few decades. People are getting their city space back because that’s what they want; we only think we like cars when we can’t imagine getting around without them. Otherwise, they are usually a nuisance.

And if you are worried about what the French might think on seeing the Victory Monument made more prominent in Freiburg in whatever way is eventually decided, I leave you with a quote from a citizen of Freiburg at a town hall meeting on the issue: “The French are not that uptight.”

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

Categories: Blogs

The future of Germany’s Energiewende

24 July, 2017 - 17:21

When Germans cast their vote in the national elections on September 24 they will also be deciding on the direction of the country’s energy policy. Arne Jungjohann takes a look at how German politics may help, or hinder, the energy transition.

Renewables aren’t enough – Germany will need more ambitious policies to reduce its carbon footprint. (Photo via Wikipedia Commons, edited, CC BY-SA 1.0)

The economy, security and refugees have dominated the campaign trail so far but, a recent, unexpected vote on whether to legalise same-sex marriage showed, the campaign agenda can pivot at speed.

A key decision for voters in the coming election will be who guides the country’s Energiewende. Germany’s much-feted transition to a low carbon economy is going to face challenging circumstances in the next legislative period (2017 – 2021).

First, 2020 will be a year of reckoning for the incoming coalition. Germany is likely to meet its renewable targets but fall short on goals to cut energy consumption and increase energy productivity under its EU obligation. Most damaging for the Energiewende’s international credibility, the government will miss its national 2020 climate target by a wide margin. Instead of cutting emissions by 40%, the latest estimates see the country hitting only 32%.

Source: cleanenergywire.org

The second issue is that many coal and nuclear power plants will shut down over the next few years. Under the government’s law, eight nuclear reactors which currently provide around 13% of gross power generation, with a total capacity of 10.8 gigawatts will be taken offline by 2022.

In addition, the government has moved eight lignite coal-power plants into what’s called a “cold capacity reserve”. These plants, totaling 2.7 gigawatts of capacity, will only be re-activated if Germany’s power supply unexpectedly cannot meet demand. However, experts think it is unlikely the plants will ever be used again; with many referring to the reserve as “Jurassic Park”.

The third consideration is the European Union’s (EU) climate and energy agenda, which will demand significant input from Germany’s next government.

To set the course for achieving its 2030 energy and climate targets, the EU plans to revise several of its directives. The wide-ranging Clean Energy for All Europeans package covers renewable energy, reform of the EU’s emissions trading system, the design of electricity markets, security of electricity supply and governance rules.

To improve efficiency across the EU, the EU Commission is also proposing more ambitious standards for technical appliances under its eco-design directive, such as tablets and televisions, as well as a strategy for building renovation and automated mobility.

Policy agenda

Although the Energiewende faces setbacks, the country’s integrated approach to climate and energy policy has provided a solid foundation for it to move away from nuclear and fossil fuels to renewable energy sources by mid-century.

Merkel’s Grand Coalition has already shifted away from feed-in tariffs to auctions; it passed an electricity market law to improve price signals when demand is low to activate peaking power plants and pushed through changes to the grid by promoting underground power lines, limiting additional wind turbines and requiring grid operators to integrate, so-called, peak shaving as a key instrument of their planning.

With near-term targets likely to be missed, the challenge ahead is to meet the country’s mid-term targets. These include cutting greenhouse gas emissions by 55% from 1990 levels and increasing the share of renewables in the power supply to at least 50% by 2030.


Date: Monitoring Report 2016, Source: Cleanenergywire.org

The next era of the Energiewende will also see major structural changes to Germany’s energy supply.

Wind and solar power will become the main pillars of the country’s electricity supply. To cope with fluctuations, Germany must increase its grid flexibility and back-up capacity. Fundamentally different generation patterns will emerge.

And sooner or later, inflexible, baseload power plants such as nuclear will disappear altogether, leaving the remaining gas and coal power plants to operate on a part-time basis.

Another priority will be sector coupling, in which renewable electricity is used to supply buildings, industry and transportation.

So what policies can address these challenges?

Government to-do list

At the top of the next government’s list will be a roadmap for the phase-out of German coal mining and coal-powered generation.

In its recent Climate Action Plan 2050, the government already announced the establishment of a commission for structural change and regional development to address a coal phase-out. Its mandate is still to be defined.

While the mining union opposes a planned phase-out, coal regions have slowly accepted that the end of coal mining is in sight; and their leaders are already bargaining for federal funds to finance the economic transformation of their states. In the end, the question is not if, but when, Germany finally says goodbye to coal.

Another task is a fundamental reform of energy levies and surcharges. Germany’s main instrument to support renewables expansion – the renewable energy surcharge – is under intense scrutiny. Demands for a fairer distribution of costs, as well as the prospect of rising power demand as heating and transport switch from fossil fuels to electricity, have led to calls for a new system to support investment in the sector.

Experts argue that pricing carbon higher would be a far more efficient way to finance the Energiewende. Thus, calls for a national carbon floor price are growing, similar to what the UK has introduced and to what France is planning. The idea will gain traction if the EU doesn’t improve its carbon price under the emissions trading system (EU-ETS), which for years has been plagued by low prices due to an oversupply of permits.

Though the current government claims it has established an “efficiency first” principle, ambitious policies to cut energy consumption remain to be seen. The roll-out for “smart metres” is coming late and with low ambition. Other upgrades, such as, time-of-use energy pricing, smart grids and load shifting offer economic benefits and energy savings but better policies are needed.

Finally, Germany needs to adjust its power grids to accommodate growing flexibility and decentralised generation. Despite a high share of renewables, Germany has one of the most reliable power supplies in the world. But to keep the grid stable with large influxes of renewable power, the Federal Network Agency has proposed expanding it.

These plans are highly controversial and already face delays. The next government will have to decide how to deal with these.

Where the political parties stand

Implementation of these policies falls to the next coalition government. In Germany’s pluralistic system, no party alone expects to win a majority. The need to form coalitions forces parties to cooperate. A change in government, therefore, does not necessarily result in a complete policy reversal.

So does it matter who wins the September elections? You bet.

All five established parties support the Energiewende, in general, and see the need for climate protection. But they differ on priorities, ambitions and pathways.

Current polls give Chancellor Merkel’s conservative party (CDU/CSU) a double-digit lead over the Social Democrats (SPD). The left-wing Die Linke, the Green Party and the pro-business Free Democrats (FDP) are likely to make the 5% threshold needed to re-enter parliament. So is Alternative for Germany (AfD), a nationalistic far-right party that embraces climate denialism.

Source: pollytix.eu

With her strong lead, Angela Merkel is hoping to win a fourth term. Although she has the nickname of “Climate Chancellor”, in Brussels and Berlin her record is not as green as her reputation would suggest. Critics say she puts the interests of German carmakers and coal utilities ahead of climate and the health of Europeans.

With the conservatives strongest, and both the AfD and Die Linke unlikely to form a government, a number of coalition constellations are in play. This includes another Grand Coalition or a centre-right coalition between the CDU/CSU and the FDP, which could lower the pace and ambition of the energy transition. In the state of North-Rhine/Westphalia, the two parties recently formed a coalition and announced a roll-back of the state’s climate protection law and drastically slow the expansion of wind power.

There is one party though whose participation in the next government would likely raise ambition on the Energiewende. The Greens are putting climate protection and ecological modernisation at the heart of their campaign. They want to shut down the 20 dirtiest coal plants immediately, initiate a coal phase-out by 2030, promote citizen energy, and ban the sale of cars with internal combustion engines by 2030.

The transformation of Germany’s energy sector is in full swing. The focus on the triple challenges of decarbonisation, decentralisation and digitisation will have to be addressed by the new coalition will have to address. Germany will continue to demonstrate that even a highly-industrialised country can decarbonise while growing its economy.

This piece was originally published at China Dialogue

Arne Jungjohann is an energy analyst and the author of Energy Democracy: Germany’s Energiewende to Renewables.

Categories: Blogs

Massive human chain protests ageing Belgian nuclear reactors

21 July, 2017 - 15:00

50,000 people from Belgium, Germany and the Netherlands formed a cross-border 90 km-long human chain on Sunday, 25 June to protest against the controversial Tihange nuclear power plant. Micro-cracks were recently discovered in one of the facility’s reactors. Sam Morgan has the details.

People take part in a tri-national human chain action, near the nuclear power plant of Tihange, Belgium, 25 June 2017. [Olivier Hoslet/ EPA]

The protesters called for the “immediate” closure of two of Belgium’s nuclear reactors, including Tihange’s reactor 2 and the Doel facility’s reactor 3, which lies on the northern border with the Netherlands.

According to organisers, 50,000 people turned out to form a human chain that stretched 90 kms from Tihange, in east Belgium, to Liège, the Dutch city of Maastricht and the German city of Aachen.

Both reactors in question were restarted in 2015 following a hiatus of more than two years after micro-cracks were detected in both facilities. The decision was made following extensive investigations and consultations with international experts.

The lifespans of Doel’s other two reactors, 1 and 2, were controversially extended in mid-2015 by ten years. Both were meant to go offline that year and will instead keep running until 2025, when they will celebrate a half-century of operation.

Nearly 40% of Belgium’s total energy needs and 55% of its electricity are satisfied by nuclear power and its reliance on its ageing nuclear stock will continue as it pursues other energy sources.

But experts recently detected 70 new fissures within Tihange 2, after using ultrasonic technology, according to Belgian Interior Minister Jan Jambon.

Jambon insisted that the power plant’s security is not in doubt and it will continue to operate. Doel 3 was also found to have micro-cracks back in November. The government said that reactor would also continue to operate

The organisers said on their website that “it is incomprehensible and unacceptable that the government leaves these reactors on”.

It is not just the state of Belgium’s reactors that has angered protesters. Its seven reactors are all at least 30 years old and three of them are 40 years old.

Japan’s 2011 Fukushima disaster convinced Germany to begin phasing out nuclear power and in early 2016, Environment Minister Barbara Hendricks called on her Belgian counterparts to “temporarily” take the reactors offline due to unresolved safety concerns after hydrogen flakes were detected in both.

Hendricks failed in that bid but both governments did eventually agree to a better exchange of information on all things related to nuclear power.

It is unclear how these fresh concerns about the state of the Tihange facility will affect Brussels-Berlin relations, especially given Hendricks’ disappointment with last year’s agreement, which “did not meet all the needs and expectations of border communities”.

A European Court of Auditors report last year found that the decommissioning of a number of Soviet-era nuclear reactors within the EU is significantly behind schedule and that billions of euros are still needed to complete the job.

Decommissioning eight reactors in Lithuania, Slovakia and Bulgaria was part of those countries’ EU accession deals but the process is still ongoing. The strongly-worded report recorded a number of shortcomings in terms of know-how and potential improper use of EU funding.

One nuclear power plant in Lithuania has the same type of reactors as Chernobyl, the infamous Ukrainian facility that failed and caused a massive disaster in 1986. It is the first time that a graphite reactor will have been decommissioned, although the initial shutdown date of 2029 has now slipped to 2038.

This article has been republished from EURACTIV.com

Sam Morgan is a reporter and translator for Euractiv.com.

Categories: Blogs

Renewable energy no threat to electric grid, as Trump aides claim

20 July, 2017 - 15:00

The Trump administration has claimed that renewables threaten grid stability. Then why, ask David Hochschild and David Olsen, has the US military an early adapter of renewables? And why does Germany have a more reliable grid than the US?

SunRun installers Brandon Anderson and Will LaRocque work on one of 28 Q-Cell panels on a home in Sunnyvale in 2016, adding to the solar power trend. (Photo by Michael Noble Jr., The Chronicle)

In 1986, President Ronald Reagan famously removed solar panels from the White House roof, capping a misguided energy policy that severely slashed investment in renewable energy. Thirty-one years later, President Trump has committed a more consequential mistake by rejecting the Paris climate accord. But the story of how solar energy survived and thrived after Reagan holds an encouraging lesson for us.

After Reagan, states such as California stepped up and invested heavily in solar research, development and market incentives. Despite being slowed by a reduction in federal support, the progress over time was dramatic. Since Reagan’s election, the price of solar panels has fallen by 99 percent. Last year, solar energy was the single largest source of new electricity generation added to our nation’s electric grid, contributing about 40 percent of the total. Solar energy provides jobs for 260,000 people in America, compared to just 65,000 by the coal mining industry. Wind energy, which followed a similar trajectory, now employs more than 100,000 U.S. workers.

Bold leadership to combat climate change in the United States will not come from Washington, D.C., but from a combination of state and local efforts. But for these efforts to succeed, one falsehood must be debunked immediately.

U.S. Energy Secretary Rick Perry recently signaled that the Trump administration may soon seek to undo all state and local renewable energy policies across the country on grounds that clean technologies such as wind and solar power pose a threat to grid reliability and, therefore, jeopardize national security.

While a convenient myth for the fossil-fuel industry, this is nonsense. To begin with, in the interest of national security, the military itself has become a national leader in adopting renewable energy. The U.S. Navy, for example, is quickly moving toward its goal of using 50 percent renewable energy by 2020.

In California, which has installed more clean energy than any other state, there have been no threats to the reliability of the electric grid caused by renewables. Instead, the three biggest threats to our grid over the last 20 years came from market manipulation (Enron et al, during the 2001 energy crisis), a nuclear plant failure (San Onofre, 2012) and the largest natural gas leak in history (Aliso Canyon gas storage facility, 2015). Rather than create these emergencies, renewable energy was part of the solution and continued to operate reliably and prevented these events from becoming worse.

Almost two-thirds of the new electric generation capacity added to the grid in the United States over the last two years has come from wind and solar. From a reliability perspective, this is a positive development. In August 2011, when a heat wave in Texas shut down 20 natural gas plants, it was wind power that kept the electric grid operator from having to black out areas of the state. In Iowa, wind power now provides 37 percent of the state’s electricity with no reduction in reliability.

What happens when the wind doesn’t blow, or the sun doesn’t shine? To answer that question, one needs to examine the many countries that have more renewable energy than we do. Wind and solar contribute a share 2.5 times larger in Germany’s electricity mix (18.2 percent in 2016) than they do in the United States (6.9 percent). Germany produced 82 percent of its electricity from renewables for a period of several days in May. Denmark gets 100 percent of its electricity from renewables on many days of the year. Yet both nations have electric grids that are 10 times more reliable than America’s. Germany and Denmark average 23 and 24 minutes of customer outages per year respectively, while the United States averages 240 minutes per year.

These electric grids share several features that create stability. They have a diverse mix of renewables — onshore wind, offshore wind, photovoltaic and solar thermal power, geothermal power, hydropower and energy storage, mainly in the form of water pumped behind a dam. The European grid is a regional grid, and the sun is almost always shining, or the wind blowing, or water flowing, somewhere in Europe. Countries like Germany and Denmark also pay a lot of attention to weather forecasting, so that they can accurately predict and plan for how much solar and wind power they will generate. And they have electrified more of their economy than we have, including much of the rail network.

These are the defining qualities of the clean electric grid of the future. Clean energy is good both for the grid and the bottom line. That’s why the private sector here at home is now helping make it happen. Google, Walmart, General Motors, Facebook and Apple have all committed to using 100 percent renewable energy.

If the Trump administration does indeed seek to roll back state and local renewable energy policies on grounds that it jeopardizes the electric grid, then it would constitute yet another historic mistake. Rather than representing a threat to our electric grid, renewable energy is its future.

This article was originally published in the San Francisco Chronicle.

David Hochschild is a commissioner with the California Energy Commission, the state’s primary energy policy and planning agency. David Olsen is a member of the California Independent System Operator Board of Governors, which runs the state’s electric grid.

Categories: Blogs

Japan, Taiwan and Korea accelerate demise of thermal coal market

18 July, 2017 - 15:22

Word is out that Taiwan has attracted $60 billion in foreign capital commitments to renewable-energy projects, adding to the fast-gathering momentum around the electricity sector transition taking deep root across Asia. Tim Buckley takes a look at the impact on coal.

Coal imports might decline by 2% annually, due to cheaper renewables (Photo by Petar Milošević, edited, CC BY-SA 4.0)

An excerpt from the article posted by Nikkei Asia Review:

Global renewable energy companies are rushing to set up offshore wind farms in Taiwan, seeing a promising business opportunity on an island offering one of the most suitable locations for such facilities in Asia.

Investment applications filed with the government so far reached around 1.8 trillion Taiwan dollars ($59.5 billion), more than triple the quota set by Taipei. Denmark’s Dong Energy, Australia’s Macquarie and Canada’s Northland Power were among those joining the fray.

The Taiwan Strait is said to be uniquely suited for wind power generation. On Penghu Island, roughly 50km west of Taiwan’s main island, blistering winds are constantly slamming the hilltop on the coast. “Here, it always feels like a typhoon, but winds are a lot weaker now than in the wintertime,” explained a Taiwanese official.

The news is consistent with recent policy and political change in Japan, South Korea and Taiwan—“JKT” in industry parlance—that will drive further structural decline in global seaborne coal markets (and not incidentally, profoundly affect Australia’s coal industry, since those three countries are three of Australia’s key coal-export markets).

The facts of the matter sharply contradict  growth projections from such governmental bodies as Australia’s Office of the Chief Economist (OCE). The OCE has JKT thermal coal imports somehow growing at 8.7 percent—or triple the global rate of growth—to 2022.

Such projections seem to stem fundamentally from a fantasy that precludes the reality of the electricity-generation transition gaining pace globally, and especially in Asia.

As a result of the election of President Moon Jae-In in South Korea, economic stagnation in Japan, and far-reaching policies driving renewable energy in Taiwan, we at IEEFA see collective JKT imports declining by up to 2 percent annually.

This equates to a cumulative decline of up to 26Mt by 2022, consistent with the unexpected 2016 decline of 2 per cent for Taiwan and the 4 per cent decline for Japan.

Australia’s coal industry isn’t the only huge exporter to be affected by the JKT events.

While Indonesian coal exports to Taiwan have been negligible, Japan and Korea hold second and fourth place as top export destinations for Indonesian coal.

For seaborne thermal coal imports, JKT account for a combined 301-million-tonne-per-annum (Mtpa) market, 29% of the 2016 global total. And it dominates Australia’s coal-export industry, accounting for 142Mtpa, or 70 percent, of Australia’s export total.  China is a distant fourth at 15 percent and India accounts for just 3 percent.

The OCE’s forecast of 46Mt or 2.5 percent total growth in global thermal coal imports to 1,062Mt over the six years to 2022 is optimistic, in our view, especially in the face of the clear policy headwinds evident in the top two coal import markets globally i.e. China and India.

Even with a surge in Chinese coal market this year, forecasts are for contraction in China after its 2013 imports peak due to ongoing policy initiatives to restrict coal imports. India targets a virtual cessation of thermal coal imports, with record low solar tariffs suggesting this is achievable.

In only a few weeks time this spring, major Asian economies have made notable strides in electricity-generation thinking—and action—that would’ve been unconceivable as recently as a couple of years ago.

This month alone has seen Taiwan update its new eight-year green energy development plan and has the country now expecting a fourfold expansion in renewables, to 20 percent of its electricity portfolio, and a one-third decline in reliance on coal-fired power generation, from 45 percent to just 30 percent by 2025. Taiwan’s initiatives include constructing 4.2GW of onshore and offshore wind farms, with the first 1.5GW awarded to Copenhagen Infrastructure Partners earlier this month.

As Moon Jae-in has risen to power, his policies have been placed immediately into action.  The new South Korean national electricity plan includes the immediate temporary suspension of licenses for eight end-of-life import coal-fired power plants. Speculation is arising too that work will be suspended on partially constructed new coal-fired power plants, undermining KRW13 Trillion (US$12bn) of investment proposals by SK Gas, POSCO Energy and Samsung C&T.

April  saw Japan raise its cumulative installed renewable energy capacity to over 100GW, a near doubling since the Fukushima disaster in 2011. Adding to its long-established 50GW of hydro-electricity capacity, Japan now has more than 45GW of cumulative installed solar, with onshore wind and waste-to-energy making up the balance. Its latest progress on this front was the commencement this month of the 258MW Okayama solar plant in Okayama, Japan’s largest solar project to date.

Combined with the cumulative 12 percent decline in electricity demand since 2010, renewables and energy efficiency are transforming the Japanese electricity grid. IEEFA sees a continuation of this trend coupled with possible nuclear restarts that will see Japan’s thermal power generation decline 2-3 percent annually in the coming decade.

Actual trends in Japan’s electricity sector are now at odds with the official open-ended government plan to add 23GW of new coal-fired power capacity—a plan that seems increasingly outdated and largely redundant. The cancellation this past January of the 1,200MW Ako coal plant conversion by Kansai Electric and the March  announcement by TonenGeneral to cancel a 1,000MW coal plant are likely the first of many over the coming year or two.

This article was originally published at Renew Economy.

Tim Buckley is IEEFA’s director of energy finance studies, Australasia.

Categories: Blogs

Germany’s worse-case scenario in the power sector

17 July, 2017 - 17:50

What can be done when it is dark (no solar power) and there is no wind either, but power demand is high? German analysts took a look at the worst combination in recent history – from 2006 – and found a way to bridge the gap. But is it affordable? Craig Morris’ main takeaway: The Germans know the Energiewende’s weak spot, and they have modeled it, modeled it, modeled it.

Germans have put some thought in to what to do when the sun doesn’t shine (Photo by Takeshi Kuboki, edited, CC BY-SA 2.0)

Remember the Dunkelflaute (dark doldrums) – when there is very little wind and solar power? Energy Brainpool took a look at weather records to find the worst such case in recent history to investigate what they call the “cold Dunkelflaute,” when power demand is also high (PDF in German). 2006 started off with such conditions.

In the chart below, the green line represents demand. The residual load (red) is the amount of demand not met by solar and wind (shown below the baseline). As you see, there were nearly 2 weeks in which dispatchable plants had to cover practically all of the demand.

Source: Energy Brainpool

Germany is obviously adding a lot more solar and wind, so Energy Brainpool investigated one scenario with 69% renewable electricity in 2030 (the official goal is 80% by 2050 and 50% by 2030) under the weather conditions of 2006. It doesn’t look much better for those weeks.

The analysts reject the notion that there will always be wind power somewhere in Europe that can be imported. While stretching the grid across the continent will help in many cases, Europe is simply not big enough for the wind to always be blowing somewhere, as the map below of actual wind conditions on one of those days shows.

The chart below assumes (left) that nuclear and lignite will have been completely phased out by 2030. The main three power sources at that point during a cold Dunkelflaute would then be hard coal, gas (partly biogas), and power imports – but wind won’t be available in large quantities from abroad necessarily. The two pie charts on the right show the breakdown of those imports by power source (bottom) and the country (top).

You may need a few translations here: Braunkohle = lignite; Steinkohle = hard coal; Kernkraft = nuclear; and the red line at the bottom of the area chart stands for “additional flexibility.” Note that the Netherlands would be the biggest power provider to Germany under these conditions, with Austria coming in second (38% collectively). Germany would mainly be importing electricity from natural gas and hydro (59% together). Source: Energy Brainpool

The study then looks ahead to a scenario with 100% renewable power (by 2040). The solution they model is somewhat controversial as it involves power-to-gas (P2G). When the gas made from excess renewable power is converted back into electricity, the losses easily exceed 50%. Germany will essentially need a combination of seasonal storage of excess renewable power (that’s the P2G) along with power imports and demand shifting (flexibility) for “cold dark doldrums” lasting for up to 360 hours, equivalent to around two weeks. If you are looking for the Energiewende’s weak spot, look no further.

To meet peak demand of around 80 GW, there would be significant overbuilding: 231 GW of solar at a capacity factor of around 12%, 190 GW of onshore wind (capacity factor (CF): 22%), and 39 GW offshore (CF: 36% – strangely, significantly below current levels). 67 GW of gas turbines would also be needed (CF: 20%) along with 42.7 GW of electrolyzers and some 42 million electric vehicles (roughly the number of cars in Germany today) to help with storage.

All of this is exactly what critics of the Energiewende highlight: the overbuilding of capacity at low CFs along with inefficient P2G and assumptions about storage will lead to skyrocketing costs. But the study found that the electrolyzers (CF: 28%) would only make up 2% of total power supply in this scenario. And the cars are there anyway.

The price tag for this 100% scenario ranges (depending on how quickly you think the cost of renewables, etc. will drop) from 9.5 to 5.7 cents per kilowatt-hour – compared to 7.0 cents today, a figure that does not include current environmental impacts, which double the current price tag. (Taxes and other fees are not included in that figure; it merely represents generation costs.)

Aside from the price, the finding is not particularly new. Among others, the Kombikraftwerk study investigated the “dark doldrums” in a scenario with 100% renewable power – and found it to be manageable, also with lots of P2G. And I have said before (such as in 2013) that Germany will always need dispatchability roughly at the level of its annual peak demand. With each new scenario, that seemingly daunting future is looking more affordable.

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS

Categories: Blogs

EU climate laws undermined by Polish and Czech revolt, documents reveal

14 July, 2017 - 15:00

East European EU states are mounting a behind-the-scenes revolt against the Paris Agreement, blocking key measures needed to deliver the pledge that they signed up to 18 months ago. Poland and the Czech Republic led the charge, Arthur Nelsen of Climate Home explains.

The world’s second largest lignite-fired power station at Bełchatów, Poland. Coal remains a powerful political force in eastern Europe (Photo: Stasisław/Commons)

Under the climate accord, Europe promised to shave 40% off its emissions by 2030, mostly by revising existing climate laws on renewables, energy efficiency and its flagship Emissions Trading System (ETS).

But documents seen by Climate Home show that Visegrad countries are trying to gut, block or water down all of these efforts, in a rearguard manoeuvre that mirrors president Donald Trump’s rollback of climate policy in Washington.

Energy efficiency is supposed to make up around half of Europe’s emissions reductions by 2030, but a Czech proposal could cut energy saving obligations from a headline 1.5% a year figure to just 0.35% in practice.

Below the radar, Poland has also launched a manoeuvre that may block the EU’s winter package in its entirety – particularly a planned limit on power plant emissions – if it is signed up to by a third of EU parliaments, or 10-13 states.

The EU’s various wings will eventually thrash out a compromise between the commission’s original proposal – which was calibrated to meet the Paris pledge – and the counter-proposals designed to weaken this.

The effect this could have on the EU’s overall emissions has raised concerns among those in Brussels who wish to see the EU maintain its leadership on climate.

We cannot allow backward-looking east EU states to destroy the EU’s credibility on the Paris agreement,” said Claude Turmes, the European parliament’s lead negotiator on climate governance.

“A successful and ambitious energy transition is one of the few remaining positive stories for Europe. If we allow that to be drained by vested old interests from east Europe, our international credibility – and the last remaining trust of our citizens – will be smashed,” said Turmes.

The EU leadership also met with Chinese prime minister Li Keqiang. Climate change was a top agenda item at the meeting. A Sino-European coalition on climate action has been mooted as a possible bulwark against the reversal in the US.

The measures proposed by the east EU rebels are highly technical but their potential to diminish carbon savings is clear.

Existing loopholes in the EU’s energy efficiency law already cut the real 1.5% annual energy saving law to around 0.75%. But the Czech proposal, seen by Climate Home and largely accepted by the Maltese EU presidency, would slice off an estimated 0.4% in real savings by trimming the target itself and introducing loopholes.

These include a cut to firms’ energy saving obligations, a stretching of the deadlines by which they must be met, and a double-counting of solar and wind investments towards both renewables and efficiency targets.

Buildings milestones planned for 2030 and 2040 have been edited out of a separate draft energy performance in buildings law after lobbying by Visegrad states.

An article ensuring at least one electric vehicle charging point for every 10 public parking spaces has also disappeared from the commission’s proposed text.

“It is clear that the east European countries are only thinking of cheap energy and nothing else,” one informed source said. “That applies to Poland, Hungary, the Czech Republic, all of them. The problem is that Germany is not taking a leadership role.”

Documents released by Greenpeace Energydesk on Sunday show the UK government has also been lobbying to weaken the energy efficiency target, despite its intention to leave the EU.

Poland’s far right government has been mired in sniping with the European commission since taking power in 2016. This year, it has already threatened to take the EU to court over its climate laws – and won concessions on its plans for subsidies to keep coal plants running when there is no demand.

Coal is seen as the “foundation” of Poland’s development by the ruling Law and Justice party, despite the thousands of Poles it sends to an early grave each year, and the unparalleled dangers it poses to the climate.

The EU’s preferred method of squeezing big emitters is carbon trading but here too, a Polish proposal taken up by the European parliament’s majority right wing blocks would drain the EU’s proposal of meaning.

A Polish memorandum, which Climate Home has obtained, proposes carrying over a glut of 907m worthless “hot air” carbon credits into the next market phase, depressing prices and reducing incentives to scale back CO2 emissions.

Femke de Jong, a spokeswoman for Carbon Market Watch said that the Polish proposal “would rig the EU’s key climate law with loopholes [and] put the EU’s delivery of the Paris climate goals at risk, at a time when Europe’s climate leadership is most urgently needed.”

But Poland views its gambit as a “reward” for early compliance with past climate obligations, which were largely met by closing down Soviet-era industries.

While Poland’s idea might allow the EU to meet its Paris obligations on paper, it would also open the door to surplus credits covering 550 million tonnes of carbon equivalent (Mtoe), according to a commission analysis obtained by Climate Home.

The same working paper says that a separate “early counting” proposal by Bulgaria, Romania, Latvia and Lithuania would increase the carbon allowance surplus by 690 Mtoe – triple the four countries’ combined 2014 emissions.

Poland also wants a huge increase in forestry offsets that would allow it to continue its coal-first energy model so long as it plants more trees.

De Jong said the ensuing carbon credits shower would allow the EU’s agriculture sector to continue business as usual until 2030, “which means that emissions cuts would need to be nine times steeper afterwards to achieve our climate objectives.”

This article was originally published at Climate Home.

Arthur Nelsen is Climate Home’s Europe correspondent. He is also Europe environment correspondent at the Guardian. He has previously worked for the BBC, the Economist, Al Jazeera, and EurActiv, where his journalism won environmental awards. He has written two books about Israeli and Palestinian identity.

Categories: Blogs

Top global banks still failing badly on climate change

12 July, 2017 - 15:29

The results are in, courtesy of the Fossil Fuel Finance Report Card, on how the world’s biggest private banks are tooling up (or not) to tackle climate change. While there are clear signs of improvement in many of the banks’ policy coverage, most notably on coal, overall the picture remains bleak and highly concerning. Yann Louvel and Greig Aitken take a look.

Last year, banks spent $30.25 billion financing coal. (Photo via flickr, edited, CC BY-SA 2.0)

For ‘Banking on Climate Change’ – the eighth annual report card – BankTrack and their partners Rainforest Action Network (RAN), Oil Change International and Sierra Club have expanded the grading coverage of fossil fuel policies to 37 banks from across Europe, the United States, Canada, Japan, China and Australia. The publication is packed with new data, and RAN’s online presentation of some of the stand-out material is highly recommended for a quick, accessible browse.

But one of the most telling aspects of the data crunching is this regional breakdown of average grades across sectors.

(Source: Banktrack)

What we’re seeing most starkly is the growing chasm between European and US banks on the one hand, and the rest of the world on the other, with tightening coal policies at the former institutions driving this phenomenon.

Chinese banks continue to be unengaged, but the five ‘F’ ratings of the big three Japanese banks – Mitsubishi, Mizuho and Sumitomo Mitsui – is startling, and unfortunately in keeping with what we’re regularly seeing now at the coal project level in southeast Asia.

As Greenpeace and Sierra Club have pointed out recently, with its plans to build 49 coal plants, “today, the biggest investor in coal is a country not many would expect – Japan”. And Japan’s banks are still intent on sowing climate chaos and public health problems across borders.

A disturbing, under the hood trend, however, concerns gross volumes of coal power financing. Despite various tangible moves to rein in coal power financing by western banks over the last couple of years, for the banks reviewed we’ve seen year-on-year coal power finance increases over the last three years when taken as a whole:

  • $21.11 billion in 2014
  • $23.25 billion in 2015
  • $30.25 billion in 2016.

More widely, with the report card’s breakdown of individual and total figures for extreme fossil fuel financing between 2014 and 2016, there is better news: the $87 billion total identified for 2016, the first full calendar year to be studied since the signing of the Paris Climate Agreement, represents a 22 percent drop from the previous year.

But the bottom line remains that from all 37 banks, between 2014 and 2016, $290 billion of direct and indirect financing was doled out for extreme fossil fuels – that is, huge levels of new investment in the exact subsectors whose expansion is most at odds with reaching climate targets, respecting human rights and preserving ecosystems.

Moreover, immediately following the Paris Agreement, in 2016, almost one third of the banks we assessed did in fact increase their financing to the top extreme fossil fuel companies – and, significantly, this is far from being an Asian bank dominated list of shame:

  • Australia and New Zealand Banking Group (ANZ)
  • Bank of America
  • Bank of Montreal
  • Barclays
  • China Construction Bank
  • Citigroup
  • JPMorgan Chase
  • Mizuho Financial Group
  • Santander
  • Toronto-Dominion Bank (TD)
  • UBS
  • UniCredit.

This shocking finding is part explained by the scant policy coverage at the majority of banks where extreme oil and LNG export financing is concerned, as we’ve once again identified this year. In the context of the current pipeline boom captured in the report card’s case studies, and the growing risk that the Dakota Access debacle will be repeated, banks’ lack of a policy approach here is nothing short of alarming.

Banktrack.org will be returning to some other facets of the report card on this blog in the coming weeks. It really is crammed with rich (albeit grim) data, analysis and collaborative testimony from civil society partners all over the world, which we’ll flesh out further in a series of upcoming posts. For a further quick flavour, though, do also check out the Guardian’s coverage of the Report Card launch.

This article was originally posted at Banktrack.org.

Yann Louvel is the climate and energy campaign coordinator for BankTrack since September 2010. Before that he worked as private finance campaigner for Friends of the Earth France for 3 years.

Greig Aitken joined BankTrack in August 2014 to help strengthen our global coal campaign’s research and outreach impacts. Previously he was Media coordinator for CEE Bankwatch Network.

Categories: Blogs