2011-05-18T12:05:36+02:00 lifetype-1.2.9_r6922 http://www.sceptreinternational.com/blog/rss.php?blogId=1&profile=atom Copyright (c) blogadmin tag:www.sceptreinternational.com,2011-05-18:408 2011-05-18T12:05:36+02:00

UK To Lead World In Cutting Carbon Emission The Government will sign up to the "ambitious" target of a 50% cut in carbon emissions by 2025, the Energy ...

blogadmin Carbon Offsetting UK To Lead World In Cutting Carbon Emission The Government will sign up to the "ambitious" target of a 50% cut in carbon emissions by 2025, the Energy Secretary has confirmed. Chris Huhne told the Commons the Government had accepted the advice of its climate advisers for the fourth "carbon budget", which runs from 2023 to 2027. The minister, who is currently at the centre of claims that he persuaded someone else to take speeding penalty points on his behalf, said the decision would be reviewed in 2014. But Mr Huhne added it sent a clear signal that the Government was serious about driving the transformation to a low carbon economy. The UK will now pledge to cut emissions by 50% on 1990 levels by 2025, as recommended by the Committee on Climate Change (CCC). This would also put the country on target for 60% cuts by 2030. The UK will cut emissions by 50% on 1990 levels within the next 15 years David Kennedy, chief executive of the CCC, said he was "delighted" the body's recommendations had been accepted. Prime Minister David Cameron said: "When the coalition came together last year, we said we wanted this to be the greenest government ever. "This is the right approach for Britain if we are to combat climate change, secure our energy supplies for the long-term and seize the economic opportunities that green industries hold. "By making this commitment, we will position the UK as a leading player in the global low-carbon economy, creating significant new industries and jobs." But the announcement came despite a Cabinet rift on the issue - a letter leaked last week appeared to show tensions between ministers. Mr Huhne told the House the decision would be reviewed in 2014 Business Secretary Vince Cable apparently argued for less ambitious reductions in the 2020s because the targets could limit economic growth. After the letter emerged, a coalition of environmental bodies warned Mr Cameron he risked seriously undermining his pledge to lead the "greenest government ever" if he did not back the targets. Labour leader Ed Miliband also seized on the evidence of internal disagreement, writing to the PM to tell him that failing to agree would send "a terrible signal" to businesses and the rest of the world. But over the weekend Mr Cameron was reported to have stepped in to resolve the fraught battle within the Cabinet, with a decision to support the targets. "By making this commitment, we will position the UK as a leading player in the global low-carbon economy, creating significant new industries and jobs." Prime Minister David Cameron When asked about this after Mr Huhne had made his statement, Mr Cameron said: "Number 10 is always involved. In this case, my office was involved in trying to encourage a solution. "Obviously we want to meet the 50% target, and we are doing that. "The Business Secretary and others had very legitimate concerns about energy intensive industries and how we should try to put together a package to help them. "Because they are being affected, not just by the carbon budget but by also changes to the electricity market and other costs. "It doesn't actually help climate change if you simply drive an energy intensive industry to locate in Poland rather than Britain. "That was one sticking point. We have a good agreement that is going to deal with that." http://news.sky.com/skynews/Home/Politics/Video-Chris-Huhne-Carbon-Emissions-Will-Be-Cut-By-50-By-2025-Energy-Secretary-Says/Article/201105315993617?lpos=Politics_First_Poilitics_Article_Teaser_Regi_1&lid=ARTICLE_15993617_Video%2C_Chris_Huhne%3A_Carbon_Emissions_Will_Be_Cut_By_50%25_By_2025%2C_Energy_Secretary_Says tag:www.sceptreinternational.com,2011-05-13:406 2011-05-13T17:33:32+02:00

Renewables could meet 80 percent of all energy needs by 2050, says IPCC Close to 80 percent of the world‘s energy supply could be met by renewables by mid-century if backed by ...

blogadmin Carbon Offsetting Renewables could meet 80 percent of all energy needs by 2050, says IPCC Close to 80 percent of the world‘s energy supply could be met by renewables by mid-century if backed by the right enabling public policies a new report shows. The findings, from over 120 researchers working with the Intergovernmental Panel on Climate Change (IPCC), also indicate that the growing use of renewable energy could lead to cumulative greenhouse gas savings equivalent to 220 to 560 Gigatonnes of carbon dioxide between 2010 and 2050. The upper end of the scenarios assessed, representing a cut of around a third in greenhouse gas emissions from business-as-usual projections, could assist in keeping concentrations of greenhouse gases at 450 parts per million. It could also help to hold the increase in global temperature below 2 degrees Celsius – an aim recognized in the United Nations Climate Convention's Cancun Agreements. The findings, approved by member countries of the IPCC meeting in Abu Dhabi, United Arab Emirates, are a summary for policy-makers,  of a comprehensive assessment compiled by over 120 leading experts. Geothermal power station, Fang, Thailand. Photo © 2000 Geothermal Education Office Ramon Pichs, Co-Chair of the IPCC's Working Group III, that oversaw the report, said it showed that it is was not resources but public policies that will either expand or constrain renewable energy development over the coming decades. Developing countries had an important stake in this future — this is where most of the 1.4 billion people without access to electricity live yet also where some of the best conditions exist for renewable energy deployment. Four scenarios The six renewable energy technologies reviewed are: Bioenergy, including energy crops; forest, agricultural and livestock residues and so called second generation biofuel Direct solar energy including photovoltaics and concentrating solar power Geothermal energy, based on heat extraction from the Earth‘s interior Hydropower, including run-of-river, in-stream or dam projects with reservoirs Ocean energy, ranging from barrages to ocean currents and ones which harness temperature differences in the marine realm Wind energy, including on and offshore systems . The most optimistic of four scenarios set out in the report projects that renewable energy could account for as much as 77 percent of the world‘s energy demand by 2050, amounting to about 314 of 407 Exajoules per year. This is over three times the annual energy supply in the United States in 2005, or a similar level of supply on the Continent of Europe. Seventy percent is up from just under 13 percent of the total primary energy supply of around 490 Exajoules in 2008. Each of the scenarios is underpinned by a range of variables such as changes in energy efficiency, population growth and per capita consumption. These lead to varying levels of total primary energy supply in 2050, with the lowest of the four scenarios seeing renewable energy accounting for a share of 15 percent in 2050, based on a total primary energy supply of 749 Exajoules. Declining costs While the report concludes that the proportion of renewable energy will probably increase even without enabling policies, past experience has shown that the largest increases come with concerted policy efforts. Illustration of a massive ocean turbine farm. Credit: Voice of America Though in some cases renewable energy technologies are already economically competitive, the production costs are currently often higher than market energy prices. However, if environmental impacts such as emissions of pollutants and greenhouse gases were monetized and included in energy prices, more renewable energy technologies may become economically attractive. For most of them, costs have declined over the last decades and the authors expect significant technical advancements and further cost reductions in the future, resulting in a greater potential for climate change mitigation. Public policies that recognize and reflect the wider economic, social and environmental benefits of renewable energies, including their potential to cut air pollution and improve public health, will be key for meeting the highest renewables deployment scenarios. Increasing the share of renewables requires additional short-term and long-term integration efforts,the report says. Studies clearly show that combining different variable renewable sources, and resources from larger geographical areas, will be beneficial in smoothing the variability and decreasing overall uncertainty for the power system. Key findings Of the around 300 Gigawatts (GW) of new electricity generating capacity added globally between 2008 and 2009, 140 GW came from renewable energy. Despite global financial challenges, renewable energy capacity grew in 2009—wind by over 30 percent; hydropower by three percent; grid-connected photovoltaics by over 50 percent; geothermal by 4 percent; solar water/heating by over 20 percent and ethanol and biodiesel production rose by 10 percent and 9 percent respectively. Developing countries host more than 50 percent of current global renewable energy capacity. Most of the reviewed scenarios estimate that renewables will contribute more to a low carbon energy supply by 2050 than nuclear power or fossil fuels using carbon capture and storage (CCS). The technical potential of renewable energy technologies exceeds the current global energy demand by a considerable amount — globally and in respect of most regions of the world. Under the scenarios analyzed in-depth, less than 2.5 percent of the globally available technical potential for renewables is used — in other words over 97 percent is untapped underlining that availability of renewable source will not be a limiting factor. Accelerating the deployment of renewable energies will present new technological and institutional challenges, in particular integrating them into existing energy supply systems and end use sectors. According to the four scenarios analyzed in detail, the decadal global investments in the renewable power sector range from 1,360 to 5,100 billion US dollars to 2020 and 1,490 to 7,180 billion US dollars for the decade 2021 to 2030. For the lower values, the average yearly investments are smaller than the renewable power sector investments reported for 2009. A combination of targeted public policies allied to research and development investments could reduce fuel and financing costs leading to lower additional costs for renewable energy technologies. Public policymakers could draw on a range of existing experience in order to design and implement the most effective enabling policies - there is no one-size-fits-all policy for encouraging renewables. http://www.peopleandplanet.net/?lid=29825&topic=23&section=36   tag:www.sceptreinternational.com,2011-03-14:404 2011-03-14T20:42:09+01:00

N. Korea seeks to sell global carbon credits By Jung Ha-won (AFP)  SEOUL — North Korea is hoping to sell UN-backed carbon credits from hydropower plants now being ...

blogadmin Carbon Offsetting N. Korea seeks to sell global carbon credits By Jung Ha-won (AFP)  SEOUL — North Korea is hoping to sell UN-backed carbon credits from hydropower plants now being built, an aid group said Tuesday, as the isolated communist state struggles to secure more sources of hard cash. If approved by the United Nations, the North would be able to sell carbon credits to governments and companies trying to meet global greenhouse gas emissions reduction targets. The North asked the Hanns Seidel Foundation, a Munich-based development NGO, to help register its hydropower projects at the UN-approved verification agency known as TUV NORD, said the foundation's representative in Seoul. "We are talking about eight power plants, with the smallest size about 7.5 megawatts. These are not big projects but small or medium-sized projects," Bernhard Seliger told AFP. None has yet been completed, he said. "I saw some (construction) sites in South Hamkyong province but that's not all. There are other plants in other regions," Seliger said, adding that some of the projects are led by the UN Development Programme. The Hanns Seidel Foundation has been working since 2003 to build the North's development capacity, and in 2008 organised a seminar on carbon trading for Pyongyang officials at their request. The tradeable credits, called Certified Emissions Reductions, are awarded for approved clean-energy projects such as hydropower plants or wind farms. Big polluters elsewhere in the world can buy them as part of their efforts to cut emissions. Seliger said his foundation is helping the North to prepare for the auditing process required to join the UN carbon credit trading system known as the Clean Development Mechanism. "One good thing about this project is that it is very transparent, involving monitoring and auditing on an annual basis... I think it is very good for North Korea to participate in such an international regime," said Seliger. An official at a South Korean state agency, the Korea Energy Management Corp, said registration would take at least a year or two and it was unclear how much the North would be able to earn if approved. The official, who declined to be identified, said a typical eight-megawatt hydropower plant could yield about 19,500 carbon credits each year, each of which was currently traded at 12 euros in global markets. This would amount to around $327,000 a year. But some buyers may shun the communist state, given its history of nuclear and missile development which has led to international sanctions. "Government buyers will certainly shy away from dealing with the North," said Koo Jung-Han, a researcher at the Korea Institute of Finance. "But private companies have few reasons not to buy credits from the North as long as it can offer a competitively low price. However, the big question is whether the North will be able to build the plants without outside financiers." Koo said that countries hoping to buy carbon credits from upcoming overseas projects often encourage investment in the ventures by their own finance companies. "But what kind of financial companies will take a plunge in projects in such a volatile, politically risky country like North Korea?" The North suffers persistent power shortages even in the showpiece capital Pyongyang. Many rural areas receive power only during key agricultural seasons, and must rely for the rest of the year on alternative fuels, according to a recent policy paper published by the Nautilus Institute think-tank. http://www.google.com/hostednews/afp/article/ALeqM5gljmN_oNmfTaDFViup4tD9-NYsTQ?docId=CNG.d30777a4857e4804acfba9058a4da4df.f1 tag:www.sceptreinternational.com,2011-03-08:405 2011-03-08T20:44:23+01:00

Airlines "broadly happy" with carbon credit allowance Over 212 million credits will be divided between aircraft operators when the sector enters EU emissions trading scheme ...

blogadmin Carbon Offsetting Airlines "broadly happy" with carbon credit allowance Over 212 million credits will be divided between aircraft operators when the sector enters EU emissions trading scheme in 2012 By Will Nichols 08 Mar 2011 The European Commission has decided on the amount of carbon credits it will issue to aircraft operators when they enter its Emissions Trading Scheme (EU ETS) next year, securing luke warm approval from airlines who said the distribution of allowances had been set at "an acceptable level". Around 4,000 operators flying in and out of Europe will be forced to enter the emissions cap-and-trade scheme and required to adhere to emissions targets or buy additional carbon allowances to cover any excess emissions. The Commission confirmed yesterday it would divide allowances worth 212,892,052 tonnes of emissions between airlines in 2012, falling to 208,502,525 tonnes from 2013 onwards. This means the industry cap will be second only to power generation. Just over 80 per cent of the allowances will be given free to aircraft operators, with a further 15 per cent auctioned and three per cent set aside for distribution to new entrants. Revenues from the auction will be invested in climate-related projects, the commission said. The announcement was slightly delayed as Eurocontrol, the European Organisation for the Safety of Air Navigation that carried out research into the level of airline allowances, took more time than expected to complete its analysis of the industry. Leaked figures had suggested the overall amount of credits available to airlines would be lower than the total confirmed yesterday. Consequently, a spokesman for industry body the Association of European Airlines (AEA) told BusinessGreen that, in this respect, he was happy with the amount of credits to be released. However, he said the industry remained "confused" that flight activity in 2010 will be used as a benchmark to divide the credits between operators when several airlines were grounded for almost a month as a result of the Icelandic ash cloud. Individual airlines will hear how many allowances they have been allocated by the end of September, but the spokesman said operators feared the distribution would be skewed against those firms that had to ground planes, meaning those who were not disrupted by the ash cloud will receive a disproportionate amount of credits. The Commission dismissed these concerns, saying in a statement that it had "not seen data" to suggest the ash cloud would impact on the distribution of free allowances. "Redistribution might occur if certain airlines had to cancel a greater proportion of flights then others, while the vast majority of operators have been impacted by the flight restrictions resulting from the volcanic ash cloud," it added. "Indeed all the estimations that we have seen confirm that distributional impacts are very small." Changing the benchmarking year would require a change in legislation. "Adopting such legislation usually takes two years and there are no plans to start this process," the Commission statement said. The EU took the decision to bring the sector into its market mechanism after a global solution to tackle rising emissions across the industry failed to materialise. The commission reckons placing a cap on aviation emissions below the average level in 2004-2006 will save 183 million tonnes of CO2 emissions a year by 2020, a 46 per cent reduction compared with business as usual, and equivalent to double Austria's annual greenhouse gas emissions from all sources. However, the plan remains highly controversial and is the subject of several legal challenges from airlines that are expected to be decided by the European Court of Justice. The Commission statement said the airlines engaged in law suits had agreed to comply with the legislation until a ruling had been made.  http://www.businessgreen.com/bg/news/2031841/airlines-broadly-happy-carbon-credit-allowance   tag:www.sceptreinternational.com,2011-01-24:395 2011-01-24T15:57:32+01:00

EU votes to ban HFC-23 carbon credits   The European Parliament has voted to ban the use of HFC-23 and N20 credits in Phase 3 of the EU’s Emissions Trading Scheme – also ...

blogadmin Carbon Offsetting EU votes to ban HFC-23 carbon credits   The European Parliament has voted to ban the use of HFC-23 and N20 credits in Phase 3 of the EU’s Emissions Trading Scheme – also known as carbon credits. The ban, which runs from 2013 to 2020 was approved by the Climate Change Committee, however changes to the original proposal were made at the last minute. The prohibition will be delayed until May 2013, as opposed to the original date of January 1, after the first deadline was resisted several countries, including Italy and Spain, which were allegedly being lobbied by pro-carbon credit organisations. Connie Hedegaard, the EU’s climate action commissioner, said that the industrial pollutants offered questionable value for money, geographical distribution and environmental benefit. “Continuing to use them is also not in the EU’s interest as doing so could discourage host countries from supporting cheaper and more direct action to cut these emissions.” “Our aim is not to reduce the number of credits available but to ensure the international carbon market is based on a better quality and distribution of credits.” The decision was welcomed by the Environmental Investigation Agency, who had previously addressed a European Parliament hearing on the subject. It argued that continued use of HFC-23 credits stifles investment in sustainable projects, is poor value for European consumers and conflicts with the goals of the Montreal Protocol on ozone-depleting substances. EIA Global Environment Campaign leader Fionnuala Walravens, says: “Despite the delay, which may allow further use of about 50 million carbon credits, this is indeed an historic day,” “Industry interests have pushed hard for the ban to be delayed beyond May 2013 and today’s outcome is a compromise. It has demonstrated how all interests can unite for the sake of the climate and for the credibility of the EU’s Emissions Trading Scheme.” http://www.racplus.com/news/eu-votes-to-ban-carbon-credits/8610285.article   tag:www.sceptreinternational.com,2011-01-18:394 2011-01-18T11:15:16+01:00

Year of reckoning for Singapore biofuel investments Singapore, January 8 - Local biofuel companies that have planted jatropha crops years ago are now seeing the fruits of their ...

blogadmin BioEnergy Year of reckoning for Singapore biofuel investments Singapore, January 8 - Local biofuel companies that have planted jatropha crops years ago are now seeing the fruits of their efforts. The crops, which are at plantations in China, Myanmar and India, are now being harvested. This year will prove to be a crucial one for this biofuel crop, as companies test out whether it can succeed as a profitable commercial venture. Jatropha oil can be converted into high-quality biodiesel as well as aviation fuel. As early as 2004, jatropha curcas had been cultivated on a large scale by India and Brazil. But many such attempts in India ended in failure because the plant did not give the high yield of oil expected. Lately, there seems to be a revival of interest in the biofuel, with a better understanding of the crop and improved technology that can increase the oil yield. Carriers such as Germany’s Lufthansa, Brazil’s TAM Airlines, Air New Zealand and Air China are starting or have already carried out successful jatropha fuel trials on their planes. Local start-up Biofuel Resource, which has a 33 sq km jatropha plantation in the Guangxi autonomous region in China, is now reaping its first commercial harvest after almost four years of waiting. The area is just 10 per cent of the total land allocated to it by the Chinese government. By the end of this year, it hopes to collect 15,000 tonnes of jatropha oil - enough to power a fleet of 1,000 trucks for five years. The company will process the oil into biodiesel at its own refinery, which will be completed by the second half of this year, and sell it to businesses in Guangxi. Singaporean Charlie Teo, its founder and chairman, worked in China’s coal industry for more than 16 years before he started Biofuel Resource in 2007. He tied up with Chinese jatropha research scientists to develop the plantation in Longzhou County, Chongzuo prefecture, where there is arable but less fertile land. Their key to success: an oil yield of 40 per cent to 50 per cent using crops developed by the Chinese researchers. ‘ We hope to deliver 100,000 metric tonnes of biodiesel (each year) eventually,’ said the 46-year-old. Mr Ernest Tan, the company’s chief executive, believes that bio-fuels are a better and more efficient alternative form of renewable energy than solar and wind power. He said: ‘They are not yet practical for land transportation, which is a major consumer of fossil fuel, while biofuel is an immediately practical substitute.’ Industry analysts in Singapore agree that jatropha is a resilient fuel crop, as it can grow on marginal soil, which is unsuitable for food crops. Many plantations had failed because wild species of jatropha were used and the crops were not properly cultivated. Different renewable resources fulfil different needs, said Professor Michael Quah of the Energy Studies Institute at the National University of Singapore. There is the electron diet - which is electricity required by buildings and appliances - and there is the liquid diet - used by the majority of transportation modes such as cars, planes and ships. Said Prof Quah: ‘Our ‘liquid diet’ will always be there; hence, biofuels will be needed to satisfy this (need).’ Mr Kom Mam Sun, director of local company Biofuel Research, cited jatropha’s toxicity and low oil yield as drawbacks. ‘ When we talk to farmers, they tell us that they would prefer to plant edible crops on arable land, rather than a toxic crop,’ he said. But such problems may be resolved with proper research and planning, said Dr Hong Yan of the Temasek Life Sciences Laboratory (TLL), who is also an adjunct associate professor at the Nanyang Technological University. Dr Hong, who is also a lead researcher at Joil, a TLL spin-off, said the latter has successfully grown a tissue culture which would enable jatropha plants to have seeds which contain more oil. Other Singapore companies which have bet their dollar on jatropha include listed firm Yoma Strategic Holdings, which has a plantation in Myanmar’s Ayerwaddy Division, and Bioenergy Plantations, which has recently launched India’s first ‘self-sustainable village’ with jatropha farms, solar units and windmills in the state of Andhra Pradesh. Mr Serge Pun, chairman and CEO of Yoma, which has harvested from about 240ha of crops, said: ‘Although jatropha curcas has been around for many years, it is a new crop when it comes to large-scale commercial plantations. ‘ It needs both varietal and yield improvements to ensure sustainable commercial success.’ http://www.eco-business.com/news/2011/jan/08/year-reckoning-singapore-biofuel-investments/ tag:www.sceptreinternational.com,2011-01-18:393 2011-01-18T11:10:04+01:00

Qantas on brink of £200m biojet fuel joint venture A Qantas A380 being prepared for flight. The airline plans to build a biojet fuel plant in a deal with ...

blogadmin BioEnergy Qantas on brink of £200m biojet fuel joint venture A Qantas A380 being prepared for flight. The airline plans to build a biojet fuel plant in a deal with US group Solena. Photograph: James D. Morgan / Rex Features The Australian airline Qantas will this month announce a deal to build the world's second commercial-scale plant to produce green biojet fuel made from waste for its fleet of aircraft. Its proposed partner, the US-based fuel producer Solena, is also in negotiations with easyJet, Ryanair and Aer Lingus about building a plant in Dublin, although this project is less advanced. Airlines are trying to reduce their reliance on fossil fuels ahead of their entry into the EU's carbon emissions trading scheme in January 2012 and the introduction of other new environmental legislation. Under the scheme, any airline flying in or out of the EU must cut emissions or pay a penalty. Solena's joint venture with Qantas – which could be announced within the next fortnight – follows a tie-up with British Airways, signed in February last year, to build the world's first commercial-scale biojet fuel plant in London, creating up to 1,200 jobs. Once operational in 2014, the London plant, costing £200m to build, will convert up to 500,000 tonnes of waste a year into 16m gallons of green jet fuel, which BA said would be enough to power 2% of its aircraft at its main base at Heathrow. The waste will come from food scraps and other household material such as grass and tree cuttings, agricultural and industrial waste. It is thought the Qantas plant, to be built in Australia, will be similar. Solena uses technology based on the Fischer-Tropsch process, which manufactures synthetic liquid fuel using oil substitutes. Germany relied on this technology during the second world war to make fuel for its tanks and planes because it did not have access to oil supplies. Airlines have been using synthetic fuel made in this way from coal for years, but this results in high carbon emissions. The use of biomass – which does not produce any extra emissions – as an oil substitute has more recently been pioneered by Solena. The privately owned company says that planes can run on this green synthetic fuel, without it having to be mixed with kerosene-based jet fuel. In the UK and US, regulators allow only a maximum 50% blend, and the fuel was only recently certified for use by the UK authorities. BA is understood to be exploring the possibility of using 100% biojet fuel, once it is approved as expected. Airlines including Virgin Atlantic have also been testing biofuels – made mostly from crops, which are converted into fuel – by blending them with kerosene-based jet fuel. But experts say these blends have to have a low level of biofuels to ensure that engine safety and performance are maintained. In February 2008, Virgin became the first airline in the world to operate a commercial aircraft on a biofuel blend, but this was only 20% and through just one of the plane's four engines. The use of conventional, crop-based biofuels is controversial. Some environmentalists are concerned that an increase in the farming of crops and trees for biofuels could take up too much agricultural land and hit food production. But Solena plans to make its biojet fuel using waste, not crops. Industry experts say that, in the future, biojet fuel will work out cheaper than kerosene-based fuel as oil prices rise. Producers such as Solena could also earn subsidies by using waste materials that may otherwise have to be sent to landfill. The Germany airline Lufthansa is also understood to be interested in a joint venture with Solena. But with each plant costing £200m to build, it will take time to roll out the technology. One challenge faced by Solena is securing a supply of biomass waste for its new plants. Ideally, facilities will be located in or near cities, where most of the waste will be sourced, and near airlines' bases. The bioenergy producer will face competition from other companies planning to build incinerators, which also need to use waste to generate subsidised electricity. http://www.guardian.co.uk/business/2011/jan/02/qantas-biojet-fuel-joint-venture tag:www.sceptreinternational.com,2011-01-18:390 2011-01-18T10:51:05+01:00

Long road ahead for CO2 trade in China: observers Published: 17 Jan 2011 10:29 CET Last updated: 17 Jan 2011 19:31 CET A Chinese carbon market remains years away ...

blogadmin Carbon Offsetting Long road ahead for CO2 trade in China: observers Published: 17 Jan 2011 10:29 CET Last updated: 17 Jan 2011 19:31 CET A Chinese carbon market remains years away despite high expectation, observers said Monday. Hydro-intensive Sichuan in southern China on Monday became the latest province to ponder the introduction of a local emissions trading scheme, as Chinese regions scramble for position in the emerging low-carbon market. Guangdong and Hebei provinces have already submitted bids to host carbon trading schemes to the central government in Beijing, as has the city of Wuhan in Hubei province. But despite much talk about an emerging Chinese market, a mandatory carbon regime in China is thought by many market watchers to be several years away at least. “It can take three to five years or even longer before a market emerges,” Wilson Tang, China director at carbon trading company Climate Change Capital told Point Carbon News. A lack of a trading infrastructure and the fact that there are no real records of Chinese firms’ emissions are major obstacles to introducing a scheme, he said. Tang added that the emergence of regional schemes could be a useful start on the path to a nationwide emissions trading scheme (ETS). Local interest in emissions trading has sky-rocketed since Chinese media reported in June last year that an inter-ministerial meeting headed by China’s National Development and Reform Commission (NDRC) would set up a pilot scheme within five years. Some 20 regional carbon exchanges have been initiated over the past three years, although most of them have yet to offer any trade on their platforms. Five-year plan All interested cities and provinces must get their plans approved by Beijing before they can implement their own markets. Beijing is making final preparations for its next five-year plan, which will be adopted in March. tag:www.sceptreinternational.com,2011-01-11:387 2011-01-11T12:49:10+01:00

Offset standards: how to spot the good schemes --> Regulated, or 'compliance', carbon markets, which are governed by international rules defined in the Kyoto Protocol, and ...

blogadmin Carbon Offsetting Offset standards: how to spot the good schemes --> Regulated, or 'compliance', carbon markets, which are governed by international rules defined in the Kyoto Protocol, and which include Clean Development Mechanism (CDM) projects. (Some uncertainty hangs over CDM's future post-2012, with negotiations for a successor to Kyoto still very much in the balance.) A number of national schemes also fall into this category. --> Voluntary carbon markets, which are unregulated and include a range of different trading relationships and voluntary project standards. Many emphasise social benefits as well as carbon ones. These markets differ radically in the way they operate and who they cater for. The compliance market is aimed mainly at large energy-intensive industries that need to purchase huge numbers of credits (usually at the cheapest possible price). Although open to all, this market is dominated by companies who have compulsory targets under the Kyoto Protocol or other national or regional 'cap-and-trade' systems. As such, the credits they buy tend to be generated by major industrial-scale projects - such as cleaning up emissions from Chinese factories - which have relatively few benefits for local communities, and are hardly inspiring stories to tell. The CDM projects share, in theory, the ambitions of the Millennium Development Goals for alleviating poverty. However, unless they are certified to the Gold Standard (see below), this remains more theory than practice. In contrast, the voluntary market, which is what any company considering offsetting out of choice will be dealing with, has a much wider range of customers, from individuals to large companies, with very different needs and aspirations, resulting in a much broader range of projects. For these buyers, voluntarily purchasing relatively lower volumes of credits, price is often not the overriding concern. They are for the most part buying because they see the ethical, strategic or reputational benefit of doing so, and so the provenance of the credits, and the story behind them, become more important factors in their purchasing decisions. The voluntary market can also act as a kind of proving ground for technologies, which later go on to be recognised in the compliance market. This happened with efficient cookstoves, for example, and may well do so with water filters (which qualify for offset funding because they avoid the need to purify water by boiling it - usually using wood as fuel). Because the compliance market is regulated internationally, you might assume it is more tightly governed. In fact, there have been a number of high-profile allegations of dubious behaviour or worse. Recently, it was alleged that some Chinese chemical companies were deliberately ramping up production of HFC-23, a highly potent greenhouse gas, purely to make money from its destruction via CDM finance. That's not to say the voluntary market has always been a pillar of rectitude. In its early days at least, a lack of rigorous standards undoubtedly saw some poor projects slip through the net. But partly because of all the criticism, voluntary standards have recently become a great deal tighter, under the influence of the International Carbon Reduction and Offset Alliance (ICROA). This includes the vast majority of respectable offset providers, and was itself set up to promote the highest standards of industry practice. The standards are not entirely uniform, however, and that's no bad thing. It can help encourage innovation, and spur providers to design products for a range of buyers. And because the voluntary market is just that - voluntary - it is buyers who have the bargaining power: this in itself is helping drive standards up, as after all the criticism, no-one wants to be seen buying - or selling - a sub-standard offset. Raising the standard There are now around 20 standards covering the voluntary market, offering various degrees of rigour. Some are specialist - aimed at forestry offsets, for example. As Jonathon Porritt points out, though, while a wide range of standards may encourage innovation, it also ferments confusion among consumers. Now, however, two have have emerged as widely respected, notably the Gold Standard and the Voluntary Carbon Standard (VCS). Each standard is endorsed by ICROA, and includes tough verification elements to avoid the classic 'elephant traps' of non-additionality, leakage and impermanence (see box). On top of this, it is now standard practice among ICROA members to guarantee offsets, so if they don't materialise from one project, another must be provided as a replacement. Further assurance is provided by the rapid adoption of a registration system. First established in 2007, this allocates a unique serial number to each project and each tonne of CO 2 reduction achieved, and keeps a record of all the purchases. Offsets are tracked for life, traded securely and 'retired' permanently. So in theory this means they cannot be double counted, and project developers and offset providers alike cannot cheat the system. In a surprisingly short time, the registries have made the voluntary carbon market as transparent, if not more so, than the regulated market. All this rigour makes it doubly frustrating that, for now, the UK Government has failed to include any of the voluntary market standards in its best practice scheme, which only recognises offsets validated by the CDM - a decision described by Forum's Iain Watt as "utterly pointless... The Government was meant to be setting acceptable standards for the voluntary market, now participants are just not bothering (with UK verification)." ICROA decries "the marginalisation of voluntary projects". Ed Hanrahan of ClimateCare agrees, arguing that if the Government is serious about encouraging offsetting as a key strategy, then it really should recognise the Gold Standard and the VCS. Such has been the outcry from inside and outside the industry, that many expect the Government to change its mind on this before long. Seeing the wood for the trees: offsets and forests Forestry was the earliest target for offset funding, and no wonder. Everyone loves the idea of planting trees for the future. One of the first specialist offset companies (along with ClimateCare) was originally called Future Forests - now the Carbon Neutral Company.Some early forest offsets drew sharp criticism, however, and were found wanting on the three key 'tests' of additionality, permanence and leakage. Wary of being associated with something so controversial, many organisations stopped buying forest offsets altogether. But recently they've returned to favour, not least because of renewed focus on the speed and scale with which the world's tropical forests are being destroyed. This has in part been encouraged by the conclusions of the Stern Review, which warned that rainforest loss alone would, in just four years, release more carbon into the atmosphere than every flight from the dawn of aviation until 2025. Forest conservation is also now part of the global climate negotiations, with attention focused on the potential to reduce emissions caused by deforestation or degradation (REDD, as it's known). While there is no guarantee that this will deliver, it could end up providing a massive shot in the arm for rainforest protection (see ' Can finance save forests? '). Already, some forest governments are eyeing up the success of Belize in attracting funding from Norway (which is channelling its substantial oil earnings into forest protection). Peru, for example, wants to incorporate REDD into a broad conservation strategy that will cover 54 million of its estimated 64 million hectares of rainforest, with a final goal of eliminating all emissions from deforestation and degradation. A number of forest projects have now won accreditation under both regulated and voluntary standards, such as Plan Vivo, specifically designed for forestry by the Edinburgh Carbon Management Centre. While any forest offset will require fierce scrutiny to make sure it meets acceptable standards, it's fair to say that it's no longer the neglected member of the family. Elephant traps (and how to avoid them): Three key tests for any credible offset scheme Additionality If a project funded by offset money would have happened anyway, without that finance, then it can't credibly claim to offset carbon. So, for example, if China were to insist that all new power generation projects in a particular district must be renewable, then any renewable energy offset projects yet to be undertaken there would fail the additionality test. Safeguard Thorough checks carried out as part of a verification process, ensure that there were no funds already in place to enable such a project, or that it wasn't simply required by law. Additionality remains a complex issue. "It is part of the risk of our business," explains Edward Hanrahan. "It's one reason why we specialise in real development projects in the least developed countries, especially in Africa," as in such regions, it is far less likely that the projects would have gone ahead without carbon financing. Leakage If implementation of a project causes higher emissions elsewhere, these are referred to as leakage. It's a particular danger when conserving an area of forest which may already be under pressure, since that could simply result in the forest destruction happening nearby - for example, by people gathering firewood. It can also be a risk where investment in renewables might lead to polluting power (for example, diesel generators) simply being shifted elsewhere. Safeguard Ensure that there is adequate protection for any neighbouring forest; or if the project involves tree planting, make sure that this doesn't displace agricultural land. Establish careful baselines for all relevant activity in the region of the project concerned. Permanence Usually referring to forest projects. If you buy credits now which assume the trees are still going to be there, soaking up carbon, in 30 years time, you're risking all the accumulated CO 2 being released should the forest be inadvertently destroyed or felled. Safeguard As well as trying to make sure there is long term land tenure, to minimise the threat of nasty surprises, responsible providers sometimes use a virtual 'buffer zone': holding back a proportion of credits in case of unforeseen circumstances such as these. tag:www.sceptreinternational.com,2010-11-25:377 2010-11-25T10:44:38+01:00

Enel Says EU Should Limit Scope, Delay Ban on Industrial Gas Offsets The European Union regulator should limit the scope and delay the start of a planned ban on carbon offsets in its ...

blogadmin Carbon Offsetting Enel Says EU Should Limit Scope, Delay Ban on Industrial Gas Offsets The European Union regulator should limit the scope and delay the start of a planned ban on carbon offsets in its emissions-trading system to avoid market distortions, according to Enel SpA , Italy’s biggest utility. The European Commission, the 27-nation bloc’s regulatory arm, is considering a ban as of 2013 on the use of United Nations-sponsored credits related to industrial gases including hydrofluorocarbons and nitrous oxide. The EU wants to present its proposal to member states “as soon as possible,” Climate Commissioner Connie Hedegaard said today. The EU is facing “relentless” lobbying by Enel, RWE AG and E.ON AG, the climate group CDM Watch said yesterday in a report. The future of the UN Clean Development Mechanism, the world’s second-biggest carbon market, and other tools to cut greenhouse gases linked to heat waves, floods and more-intense storms will be on the agenda when envoys worldwide meet Nov. 29 in Cancun Mexico to discuss a climate-protection framework for when the 1997 Kyoto Protocol expires at the end of 2012. “If the commission pursues the idea of enforcing quality restrictions, it should bear in mind that operators took commitments in the CDM market with a long-term perspective, relying on the fact that the EU emissions trading system would last beyond the Kyoto compliance period,” Giuseppe Deodati , Enel’s head of carbon strategy, said by e-mail today. Long-Term Commitments While HFC-23 projects represent less than 1 percent of all registered CDM projects, their credits account for half of the 450 million offsets issued so far. The 19 projects cutting the gas under the UN program are located mainly in China and India. HFC-23 is a by-product of HCFC-22, used in air-conditioning and refrigeration. The EU is concerned that projects generating offsets may be increasing HCFC-22 output simply to get credits for controlling HFC-23 discharges, creating windfall profits for investors and undermining the integrity of Europe’s carbon cap- and-trade program, the world’s largest. Enel is involved in seven projects that cut HFC-23 emissions in China with companies including Deutsche Bank and Spain’s Endesa SA. According to Bloomberg data, the projects have issued 100.5 million credits, valued at 1.2 billion euros ($1.6 billion) at today’s prices. They are expected to cut HFC- 23 by a total of 239 million tons of CO2 equivalent by 2012. “We believe the EU should limit the restrictions to new projects, and to already registered projects after expiry of the first crediting period, which for most industrial-gases projects expire by 2014 at the latest,” Deodati said. Cheaper Alternative EU allowances for December 2010 traded 0.4 percent down today at 14.88 euros a ton in London. UN offsets for delivery in the same month were 0.8 percent weaker at 12.22 euros a ton. More than 11,000 facilities in the EU cap-and-trade program may now use UN credits, which are cheaper than EU allowances, for compliance with their pollution quota. In the current five-year trading period through 2012, the installations in the EU cap-and-trade program can swap as many as 1.6 billion UN credits with EU permits on a one-for-one basis, according to the commission. The EU average annual emissions cap for that period is 2.04 billion tons of carbon dioxide. One permit represents one ton of CO2. ‘Unintended Consequences’ “If the commission pushes forward a proposal on qualitative restrictions, it must clarify the objectives and the principles driving the decision to ban certain project types,” Deodati said. “If these principles are not applied, the unintended consequences could be market distortions, fragmentation, credit supply gap in a moment when no other alternative mechanism is available, discouragement of future investments and severe undermining of trust in the international negotiation process.” Carbon traders have said delays in issuing offsets and the possibility of new EU restrictions may leave them with credits that are ineligible for use in the third phase of the EU’s carbon program from 2013 and perhaps the current trading period. The European Federation of Energy Traders said in September that the “complete regulatory uncertainty” over the use of offsets in the EU was unsustainable. UN offsets include two types of credits: Emission Reduction Units and Certified Emissions Reductions. The latter, generated under the UN Clean Development Mechanism and known as CERs, are are awarded to pollution-cutting projects in developing nations. “Obviously, the restrictions should be based on when the emissions reductions are achieved, and not when the credits are issued, as operators should not be penalized for delays in CER issuance process,” Deodati said. “This would approximately halve -- by 800 million tons -- the credit pipeline from these projects to 2020, freeing up significant demand volumes.” ‘Windfall Profits’ Regulators of the CDM are also ramping up scrutiny after allegations that some developers are seeking excessive credits related to HFC-23, whose warming potential is 11,700 times more powerful than CO2. They are assessing whether the methodology for awarding those offsets should be changed. “Regarding windfall profits it’s worth noting that CDM flows toward China are justified by the objective to curb global emissions where it is most effective, and to involve developing countries in mitigation actions,” Deodati said. E.ON, Germany’s largest utility, said the EU should allow for an “appropriate transition period” before changing its rules on accepting offset credits. In a letter responding to CDM Watch, E.ON also said UN carbon regulators have a certification process that is “very robust.” http://www.bloomberg.com/news/2010-11-19/enel-says-european-union-should-limit-scope-delay-start-of-co2-offset-ban.html