Month: March 2014

Climate Action Plan Westward Group Energy Alternatives Paris Blog: White House, Faith Leaders and Climate Change

Climate Action Plan Westward Group Energy Alternatives Paris Blog

On February 25, the White House convened a conference on environmental stewardship and climate change with leaders of religious communities from around the U.S. There was a noticeable absence of panelists representing some groups, such as the Native Americans, the Jews and the Buddhists. There were references to God’s Earth and Creation as unifying concepts throughout the event although such concepts are not universally accepted by all religions. Still, the event was highly significant in the consensus it conveyed: The climate is simultaneously an environmental, social justice and moral issue that requires urgent action. The White House is to be commended for convening this timely gathering to mobilize support from faith leaders to address the deepening climate crisis.

The event highlighted President Obama’s Climate Action Plan which focuses on cutting carbon pollution in the U.S., preparing the country for impacts of climate change and leading international efforts to combat global climate change. The statistic that in 2012 U.S. carbon emissions fell to the lowest level in two decades, “even as the economy continued to grow,” was reiterated as a sign of progress in the right direction. There was an exhortation to embrace a bottom-up approach to climate protection throughout the event. Faith based leaders were encouraged to motivate their congregations to participate in the ENERGY STAR Program of the government which seeks to reduce energy costs and related greenhouse gas emission by 20 percent by 2020.

Although the White House event on February 25 could not provide room for deeper investigation of issues underlying climate change and environmental stewardship, broader views and discussion are essential. Can climate change be addressed from the bottom-up without top down change in the political-economic system? Moral stewardship of the environment cannot be limited to the faith-based actors. What are the moral obligations of big business, the dominant actor in the contemporary world?

Sustainable development cannot be achieved without changes in the prevailing patterns of economic growth. Shouldn’t corporations using technologies and energy that harm the environment and human well-being be required to include ethical, social and environmental criteria in their decision-making? Shouldn’t the financial sector that was bailed out at the tax payers’ expense be challenged to invest in economic production that promote both green technologies and livelihoods for people?

Moreover, sustainable development cannot be achieved without changes in the prevailing ‘way of life’. Impacts of climate change cannot be averted by strengthening roads, bridges and shorelines and improving fuel economy standards and advanced technologies alone. It is necessary to question excessive use of private transportation and encourage efficient public transportation alternatives.

The U.S. cannot claim to lead international efforts to combat global climate change without significant policy changes. The United States never ratified the Kyoto Protocol and at the Copenhagen Climate Summit in 2009, the industrialized countries led by the U.S. failed to agree on a binding agreement on carbon emissions. The 19th Annual Meeting of the United Nations Framework Convention on Climate Change in Warsaw in November 2013 also failed to secure a binding agreement to limit emissions from any country including the U.S.. The U.S. would need to make serious commitments showing the way to other industrialized countries, when a new climate treaty is to be signed in Paris to replace the failed Kyoto Protocol in 2015.

The controversial Keystone XL pipeline was not mentioned by the speakers at the White House event on February 25. Approval of the pipeline would significantly expand oil sands production, increasing greenhouse gas emissions and intensifying threats to environmental sustainability and human well-being, particularly the health and livelihood of indigenous people in Alberta. As the anti-pipeline critics point out, short term needs of corporate growth and U.S. economic competition with China should not dictate approval of the Keystone pipeline. March 7 is the deadline for Secretary of State John Kerry to finalize his recommendation to President Obama on the Keystone pipeline, which is the last step before the President’s final decision. The approval of the Keystone pipeline will make a mockery of the administration’s efforts to reduce carbon pollution and its potential moral leadership in climate protection.

While the government is confronted with political and economic challenges in addressing climate changes, the non-governmental civil society sector is making rapid and important strides. One important initiative in this regard is the emerging divestment movement. Faith based organizations are a leader in this effort. In the past, faith leaders and organizations played pivotal roles in the civil rights and social justice movements in the U.S. as well as in the global movement to end the apartheid system in South Africa. Similarly, they are now playing a leadership role to shift financial investments away from fossil fuel companies and reinvest in institutions that support clean, renewable energy technologies. Religious institutions, some of them represented at the February 25 White House event, along with many colleges, universities, cities, counties, and other civil society organizations around the country are now divesting money from fossil fuel companies. The White House can utilize the moral authority and participatory democracy represented by citizen and faith based organizing to forge a partnership with the business sector to protect the climate, the environment and human communities at this critical time.

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Westward Group Energy Alternatives Paris – IEA chief: Only a decade left in US shale oil boom

Westward Group Energy Alternatives Paris

A surge in US oil and natural gas production has lifted hopes about North American energy security, but that growth will plateau and will be difficult to replicate elsewhere, says Maria van der Hoeven, chief executive of the International Energy Agency, in an interview with the Monitor.

The United States is awash in hydrocarbons, the result of good geology, supportive prices, a favorable regulatory and investment climate, and technology innovation. But the US energy boom is temporary, and not easy to replicate in other parts of the world, Maria van der Hoeven, chief executive of the Paris-based International Energy Agency (IEA), says in a Feb. 22 interview with The Christian Science Monitor. Here are edited excerpts:

Q: The energy industry has undergone a revolution in drilling techniques that has opened up vast new sources of so-called “tight oil” and “shale gas,” particularly in North America. Is the promise of this unconventional oil and gas overhyped?

A: The light tight oil revolution in the United States is changing the geographical map of oil trade.  But we also mentioned [in an IEA analysis] that this growth would not last – that it would plateau, and then flatten and go down. That means that from 2025 onward, it’s again Saudi Arabia and the Gulf states that will come back. Because of the changing trade map, this oil will almost completely go to Asia – China, India, Korea and Japan.

There are some people who really think they can replicate the United States shale gas boom. It’s not as easy as that. The land ownership and the resource ownership go together here in the United States – the only country where that is the case. It’s also about having the right gas industry, the right knowledge, the right infrastructure, the water, the human skills, the geological information, etc. And geology in this part of the world, especially where the shale gas boom is, is quite different from Ukraine or Poland. You can learn from it, but it’s not a copy-and-paste. The United Kingdom is changing its attitude to shale gas. China wants to develop its shale gas, but it’s in a very dry part of the country. South Africa is looking to its shale gas resources. The point is there’s a lot of shale gas in the world, but it’s not as easily accessible as it was in the United States.

Q: California is 36 months into its worst drought ever, threatening power outages in a state that gets 15 percent of its electricity from hydroelectric dams. How critical is water to the future of global energy security?

A: The use of water in producing energy is a big issue, but it is also the use of cooling water in power plants. Sometimes there is a lack of water, and hydroelectric dams are not producing as much power as they should. Sometimes there is too much water, and it threatens infrastructure. So we are working with a number of countries on the resilience of energy infrastructure to climate conditions including water – rising sea levels or storms or whatever it is. The other issue is water use in unconventional gas production [hydraulic fracturing]. We started a high level forum on unconventional gas last year, and water will be the focus of its second meeting this year in Calgary. The water-energy nexus is underestimated at this moment. The energy-food nexus is looked into from many sides, but I think the awareness for the water-energy nexus is growing and rightfully so.

Q: Countries like Spain and Germany are second-guessing ambitious plans to transition to renewables as electricity costs rise. Is Europe backtracking on its clean-energy goals?

Europe paid the price of a decarbonization policy in a time frame that made costs quite high. This is something we have to realize. You have to choose your renewable energy sources based on the indigenous sources you have. Solar in the south of Europe – in Spain, in Portugal, in Italy and in Greece – is much more available than in the northern part of Europe, like the Netherlands or Germany. But wind is more available in the north than it is in the south. There is hydropower in the Alps, in the Pyrenees, and in the Scandinavian countries. It’s important to choose your technologies based on resources you have because otherwise your feed-in tariffs will be quite high. And when you have a feed-in tariff that is paid for by part of your population like in Germany, then you have to see to it that the burdens are divided among your population in a way that is acceptable. If you have a feed-in tariff, that’s fine, but put a cap on it. And see to it that when your technology costs come down your tariffs go down, because normally the tariffs are in place for quite some years and you pay a lot of money. At the same time, you need subsidies for renewables because we are not there yet, by far. You need subsidies not only for technologies that are economically more or less viable, but also for new technologies to come. Governments need to use their money to really push technology development and new types of renewable energy that are still in a lab stage or in a pilot phase.

Q: Parts of sub-Saharan Africa are coming into new sources of oil and gas. Can countries like Kenya and Uganda reap the benefits of their own resource wealth without falling victim to the “resource curse” that has hurt countries like Nigeria?

A: Without good governance you can’t guarantee that you are not going to end up in the same situation as Nigeria. And that’s a very difficult one. This is a very poor region of the world, and in our view it’s important that you are on good terms with local populations, host populations, and with host governments. And that means that you share benefits. That can be sharing benefits of fossil-fuel resources, and that can also mean, for instance, that you invest in renewable technology to bring electricity to the people. There are more solutions than one, but we will be working on this, and will come up with a number of proposals in our World Energy Outlook 2014.

Q: About 550 million people in Africa are without electricity. Can African nations leverage renewable energy – and “leapfrog” traditional electric grid development – to increase electricity access and spur growth?

A: They need to leapfrog in Africa and they can. Why should they make our mistakes? There are quite a lot of remote areas where you have to find mini-grid, off-grid solutions, and you need to have storage capacity. It’s not always big storage capacity, but the costs have to come down. So it’s absolutely vital that we look into a myriad of options. That involves solar, it involves geothermal, hydro, wind, and other renewable and fossil sources. Let’s not close our eyes and think that because we did a number of things in Europe that it must be done the same way in other countries. We’re not only talking about renewables in Africa – it’s a mixture. And of course some countries have their own indigenous resources. The point is how they can get the money out of it to pay for the solutions for electrification.

Paris Energy Westward Group News: Thirteen ministers urge EU to agree green energy goals in March

BRUSSELS, March 3 (Reuters) – Thirteen ministers on Monday urged the European Union to reach agreement on the main elements of 2030 environment and energy policy this month or risk deterring investors and delaying efforts to get a global deal on climate change.

Among the rest of the 28 EU member states, the most prominent opposition has come from Poland, which says there is no hurry to reach a political deal.

“We can work with Poland to get an agreement in March,” Britain’s Energy and Climate Change Secretary Edward Davey told reporters. “I’m not saying it’s going to be easy.”

But he said the early agreement of the 13 ministers, including from France, Germany and Britain, provided a chance to make an agreement with Poland and others.

The Commission, the EU executive, in January outlined its vision of 2030 climate and energy policy to succeed the existing set of 2020 goals.

The Commission suggested a single fully binding 2030 target to cut carbon emissions by 40 percent compared with 1990 levels, plus an EU-wide goal to get at least 27 percent of energy from renewable sources such as wind and solar. In broad terms, the Green Growth Group supports the Commission view.

A full legislative proposal is not expected until next year, when a new set of Commissioners will have taken office, so it will take years to finalize a 2030 law, but an outline agreement from all leaders would be a strong signal.

Europe’s economic fragility, however, has increased the difficulty of agreeing on climate policy. A draft EU document ahead of the meeting of leaders on March 20-21 placed the focus on industry and competitiveness, rather than the environment.

The Green Growth Group of 15 countries, including the 13 who issued the statement, says climate policy need not be an enemy to competitiveness.

“A delay risks undermining commercial sector confidence, deferring critical energy investments, increasing the cost of capital for these investments and undermining momentum towards a global climate deal,” the group of 13 ministers said.

EU-WIDE VERSUS NATIONAL

Britain, which previously avoided any commitment to a renewable goal, said it could accept an EU-wide target provided it did not lead to any binding national targets. Critics of the EU-wide target say it is almost impossible to enforce without national targets.

The group of ministers says there is no time to lose ahead of U.N. talks seeking to get a global deal on tackling climate change in Paris next year.

It also says investors need early certainty if they are to help with the upgrading of infrastructure, for instance, which would improve grid connections in Europe, increase security of supply and theoretically lower costs.

Poland, whose economy is heavily dependent on coal, says the goals under debate would impose a greater burden on it than other countries.

Marcin Korolec, Poland’s deputy environment minister, told reporters that aiming for agreement in March was “a very optimistic approach” and that the international agenda did not require EU agreement until early next year.

“I think it will be difficult for the European Council to decide on some targets without knowing crucial elements,” Korolec said, referring to how targets should be distributed among different member states.

Alternative Energy Westward Group Paris Blog: Gold, oil rise as Ukraine tensions spur safety bids

NEW YORK, March 3 (Reuters) – Russia’s intervention in Ukraine drove up crude oil and prices for gold and government debt on Monday as the heightened tensions spurred investors to seek safe havens and sell any exposure to the region.

Crude prices rose more than $2 a barrel, gold futures jumped 2 percent and prices of top-rated euro zone government bonds surged. The aversion to risk took a steep toll on stock markets, with the Moscow bourse slumping 11 percent, wiping nearly $60 billion of value off Russian companies.

Stocks across Europe and on Wall Street also took a beating.

Market volatility indexes, a sign of investor apprehension, surged, with the Euro STOXX Volatility Index spiking 30.4 percent in its biggest one-day gain since 2011. The U.S. CBOE volatility index surged 20 percent at one point, and ended the session 14.5 percent higher.

“Investors had underestimated the risks of an escalation in Ukraine, so the events over the weekend are a wake-up call for the market,” said David Thebault, head of quantitative sales trading at Global Equities in Paris.

President Vladimir Putin’s forces tightened their grip on the Crimea region of Ukraine, sparking the stock plunge in Moscow and forcing Russia’s central bank to spend $10 billion of reserves to prop up the ruble.

Ukraine said Russia was massing armored vehicles on its side of a narrow stretch of water closest to Crimea after Putin declared over the weekend that he had the right to invade his neighbor to protect Russian interests and citizens.

The ruble traded off about 1.45 percent after earlier touching record lows against the dollar and the euro. The central bank lifted its base lending rate by 1.5 percentage points to 7 percent at an unscheduled meeting.

Russia’s sovereign dollar bonds also fell, while the cost of buying five-year swaps to insure against a Russian debt default jumped 33 basis points.

Ukraine’s hryvnia currency fell to a record low against the dollar, pushing the country’s dollar bonds down 6 points. Safe-haven German Bund futures settled up 76 ticks at 145.14.

Banks took the most points off European stock indexes, with lenders exposed to Ukraine and Russia falling sharply. The Euro STOXX banks index fell 3.8 percent in the biggest drop since last August. Austria’s Raiffeisen slumped 9.6 percent, while France’s Societe Generale fell 5.4 percent and Italy’s UniCredit lost 6.2 percent.

Other companies with significant exposure to Russia also fell, with carmaker Renault shedding 5.4 percent and brewer Carlsberg losing 5.3 percent.

The pan-European FTSEurofirst 300 index fell 2.2 percent to close at 1,318.24.

No major European stock market escaped the sell-off, with Germany’s DAX particularly hard hit, falling 3.4 percent in its biggest single-day drop since May 2012.

France’s CAC-40 index fell 2.7 percent, and the Italian stock market slid 3.3 percent.

“This has shown itself to be a broad risk-off event. Most of the action has been focused on stocks in Europe and the energy sector. A good portion of the market has not reacted to a large degree,” said Sam Diedrich, a portfolio manager at Pacific Alternative Asset Management Co. in Irvine, California.

“The most likely end-game is a grumpy compromise that allows Ukraine to go its own way in the world while allowing Russia more influence over Crimea,” said David Kelly, chief global market strategist at JPMorgan Funds in New York.

“If so, uncertainty should fade and the economic data, as the weather improves, should still support a modest over-weight to U.S. stocks over bonds,” Kelley said.

Putin will not back off but has no need to push further, suggesting markets might soon rebound, said Brad McMillan, chief investment officer at Commonwealth Financial, in Waltham, Massachusetts.

“With the substantial downsides and costs of the West trying to reverse it, Europe will probably punt and we will revert to normal faster than anyone expects,” McMillan said.

The declines in Europe followed overnight weakness in Asia, with MSCI’s broadest index of Asia-Pacific shares outside Japan down 0.9 percent and Japan’s Nikkei 225 skidding 1.3 percent.

On Wall Street, the Dow Jones industrial average closed down 153.68 points, or 0.94 percent, at 16,168.03. The S&P 500 lost 13.72 points, or 0.74 percent, to 1,845.73 and the Nasdaq Composite dropped 30.818 points, or 0.72 percent, to 4,277.301.

For U.S. investors, Russia’s intervention in Ukraine comes just as economic data has been expected to improve and provide further upside for stocks on Wall Street, noted David Joy, chief market strategist at Ameriprise Financial.

Data released on Monday showed renewed strength in U.S. manufacturing. But tensions over Ukraine have changed the investment outlook at a time when valuations for U.S. equities are not cheap, Joy said.

“Being expensive, it makes sense to me to take some risk off the table and wait to see how this plays out,” he said.

U.S. factory activity rose in February to its highest level since May 2010, according to financial data firm Markit. Separately, the Institute for Supply Management said its index of U.S. factory activity rose to 53.2 in February, topping expectations.

The dollar and yen gained as investors sought the safety of those currencies after Russia’s intervention.

The greenback was also supported by economic data showing an increase in U.S. personal income and spending in January in the midst of one of the worst winters in recent memory.

The dollar index was up 0.47 percent to 80.068. The dollar’s gains pushed the euro 0.51 percent lower at $1.3732.

Crude oil prices jumped. Brent crude hit a peak of $112.39 a barrel, the highest level since Dec. 30. Brent settled $2.13 higher at $111.20 a barrel. U.S. crude jumped $2.33 to settle at $104.92 a barrel.

Gold futures settled up $28.70, or 2.2 percent, at $1,350.3 an ounce.

U.S. government bond prices rose, with the 10-year note up 16/32 in price to yield 2.6030 percent.