Climate Action will Boost Economy
May 3, 2019
Nearby on this page, find statement from Mark Carney, governor of the Bank of England, and François Villeroy de Galhau, governor of Banque de France.
Moving to a net-zero carbon economy has enormous economic upside, while the financial community is realizing that putting off that shift has a catastrophic downside.
In April, renewables eclipsed coal generation in the US for the first time. The Energy Information Administration estimates renewables outperformed coal by 16% in April and will generate 1.4% more in May.
There is no macro-economic cost to a climate target with zero emissions. To claim that we cannot afford to wean ourselves off fossil fuels by 2050 is to rely on primitive accounting fallacies. The switch to a post-fossil economy is more likely to be an accelerant to GDP growth, akin to the successive upheavals of steam power, electricity and digital technology, each with a ripening phase of 30 years or so.
The Bank of England argues that green investment is a net economic benefit. It is a way to soak up the glut of excess savings in the global financial system and put idle capital to work.
The bond market is evidence that the world economy is badly out of alignment. Some $10 trillion (£8 trillion) of debt is trading at negative yields. Central bank rates in Japan and Europe are below zero a decade into the global economic expansion. This is what “secular stagnation” looks like.
Such is the mismatch between global savings and investment. What we need is an emergency to shake us out of our structural trap – like rearmament in the Thirties, which ended the last secular stagnation. In that sense the climate crisis is an economic gift from Mars.
For Britain, a zero target is the necessary catalyst for a revival of investment. It is how we can regain energy sovereignty instead of relying on imports that currently bleed a net 2pc of GDP each year, paid mostly to despotisms.
So I for one am cheering the Committee on Climate Change (CCC) as it exhorts the Government this week to establish the first legally binding target for zero-CO2 among major states, setting an example as it did with the original Climate Act in 2008.
Financial Times:(sub may be required)
Britain is setting out plans to become a world leader in fighting climate change, with a landmark report that seeks to cut the country’s net greenhouse gas emissions to zero in the next 30 years. Thursday’s recommendations from the Committee on Climate Change for a 2050 target to end net emissions — something no other big economy has yet signed up to — are expected to be largely adopted by Theresa May’s government.“We recognise the situation we face is an emergency, it is a crisis, it is a threat that all of us have to unite to meet,” said Michael Gove, environment secretary, in a House of Commons debate on Wednesday. “Five of the warmest years that this planet has ever endured have happened since 2010. The consequences for all of us are visible.”
The report envisions a sweeping overhaul of energy use, from homes to transport to industry. But John Gummer, the committee’s chair whose formal title is Lord Deben, said the target was attainable without causing major disruption or expense — an argument that both carbon-producing companies and some environmentalists may dispute.The 2050 goal will require the country to accelerate the adoption of electric vehicles, to quadruple energy supplies from low-carbon sources such as renewables and to create a far larger market for hydrogen to help supplant fossil fuels like natural gas. “We must now increase our ambition,” said Lord Deben. “The science demands it; the evidence is before you; we must start at once; there is no time to lose.”
Telegraph again:
From what we know, the CCC’s latest report calls for: an end to petrol and diesel car sales by 2030, or 2035 at the latest; a switch to hydrogen fuel-cells for lorries and trains; a conversion of home heating from gas to hydrogen or electric power; carbon capture on a grand scale; and the regreening of 50,000 acres each year, lifting forest cover from 13pc to 17pc.
It wants to raise offshore wind capacity from eight gigawatts (GW) to an eye-watering 75GW with 7,500 turbines, turning the UK into the world’s first aeolian superpower. Such capacity would generate a surplus of power at night that could recharge a national fleet of electric cars through a smart metering system.
Adair Turner, the CCC’s former chairman and now head of the Energy Transitions Commission, says the UK could go even further with 15 megawatt (MW) turbines on floating platforms used to make hydrogen through electrolysis as the cost of this technology starts tumbling. “The offshore potential is absolutely massive,” Lord Turner said.
Sweden has a zero-emissions target for 2045 but it has abundant hydropower. It excludes aviation. The CCC wants Britain to cover everything with no escape clauses. The UK has cut CO2 emissions by 30pc since 2008. Our £18 carbon floor has driven coal out of the market. It is a model admired across the world, unlike the EU emissions scheme, a byword for market illiteracy.
One wants to scream every time Jeremy Corbyn demands “dynamic alignment” with EU environmental law in Brexit talks. Does he want to subcontract Britain’s air management to the Polish coal industry? What accounts for Labour’s euro-sycophancy on green issues?
My critique of the CCC is that it concedes too much to sceptics. It tags the cost of zero-emissions by 2050 at 1pc to 2pc of GDP annually. This is based on the static assumption that there will be no further falls in the cost of wind, solar and renewable energy over the next 30 years, and no further leaps in technology.
This is the same number used by the CCC in 2008 when the target was an 80pc cut in CO2. “I hope nobody goes back and looks at the estimates we used for solar and wind because they were embarrassingly wrong, even though we thought we were being visionaries at the time,” said Lord Turner, who was then CCC’s chairman.
Offshore wind contracts are already coming in at £69 (MWh) for the early 2020s, 40pc lower than original estimates for 2030. Worldwide solar costs have dropped by 85pc since 2008. Batteries are on the same sort of trajectory with the lag of a decade.
A fresh study by Finland’s LUT university and Germany’s Energy Watch refutes the CCC’s cost claim. It has just completed the first “real-time” analysis of the world’s energy system, concluding that the entire needs of power, heating, transport fuel and desalination could be met by renewables at lower cost even using current technology.
May 3, 2019 at 11:28 am
I contributed to the tune of 8.2 mw last year!
May 3, 2019 at 10:35 pm
Hail Pedantia!
MW megawatt
mW milliwatt
μW microwatt
mw molecular weight?
May 3, 2019 at 10:57 pm
Congratulations, you make lame seem interesting.
May 3, 2019 at 11:59 am
“From what we know, the CCC’s latest report calls for: an end to petrol and diesel car sales by 2030, or 2035 at the latest”
Tell that to the pickup truck and Camaro/mustang/challenger crowd. They gonna fight that till the end!
May 3, 2019 at 12:05 pm
and they’ll be left with their jocks around their socks as the EV muscle cars and trucks blow them out of the water.
May 5, 2019 at 4:50 am
One of the reasons people steer away from E.V’s is the higher cost to initially purchase – with gas/petrol up at $70+ per barrel (Brent), due to the poor state of international politics and E.V prices ilowering, we should see a surge sometime soon (hopefully, but not hopiumly).
“The total cost of owning an electric vehicle will match some equivalent petrol or diesel-powered cars as soon as next year.” . . . .
https://www.smh.com.au/environment/climate-change/very-close-cost-of-some-electric-cars-to-match-petrol-ones-by-2020-20190430-p51ipm.html
May 6, 2019 at 12:52 am
Climate change: Electric car target ‘needs to be sooner’
The Committee on Climate Change believes the cost of electric cars will be similar to that of petrol or diesel vehicles by 2024-5.
https://www.bbc.com/news/science-environment-48097150
May 5, 2019 at 5:09 am
and in case they don’t get the price down (Post Haste) – let’s pray the sort out the logistics of these babies . ..
“Do ‘mechanical trees’ offer the cure for climate change?
The company, Silicon Kingdom Holdings (SKH), will build 1,200 carbon-cleansing metal columns within a year with which it hopes to capture CO2 more cheaply than other methods, following a successful test in Arizona over a two-year period, it said.”
http://news.trust.org/item/20190429234030-ijfqf/
May 3, 2019 at 8:54 pm
One reason why the UK has a quite low carbon footprint compare to other European countries:
Imagine, this country wants to leave the EU.
Thanks to decades of Murdoch and the other lying machines.
More => https://blogs.ec.europa.eu/ECintheUK/euromyths-a-z-index/
May 3, 2019 at 9:00 pm
Have a look here => https://ourworldindata.org/co2-and-other-greenhouse-gas-emissions
Then you can decide how guilty you feel.
May 4, 2019 at 10:58 am
This chart is interesting to me. And, of course, the U.S. leads it – most of of us here knew that.
However, a few other things struck me. One, China is going to blow past us in short order, and two, the chart is conveniently ignoring population. A per capita chart applied roughly to this might reveal some things. So, I did some calculations.
The U.S. population is currently 327.2 million. Ignoring China, India, and the former Soviet Union, the chart would show the following based on comparative populations:
US: 397,157
UK: 380,318
Germany: 354,355
Canada: 280,274
Poland: 228,240
France: 181,158
Japan: 150,491
The top 3 aren’t that separated, although the U.S. still leads. Canada has a lot of hydropower – it would make sense that they’d be significantly less than the U.S. Poland has a lot of coal – they should be higher, but maybe WWII and the Cold War reduced that. France is a clear winner – they’ve been mostly nuclear since the 70s. Japan baffles me. They are mostly FF – there has to be a reason they are so low, but I don’t know what it is.
May 3, 2019 at 10:42 pm
The devil is in the details: Does the GHG “emission” calculation include the carbon footprint of imported goods?
I suppose the airplane footprint entails counting 100% of the fuel use for domestic flights and 50% for international flights.
May 4, 2019 at 12:08 pm
No, and a lot of the recent separation of emissions and GDP is because of the changing economies in the West. Instead of creating a lot of goods, the West has moved to higher percentages of service industries, which have a lower carbon footprint:
https://www.economicshelp.org/tertiary-service-sector/
Practically none of that separation would be EVs so far. Some of it would be renewables:
https://en.wikipedia.org/wiki/Renewable_energy_in_the_United_Kingdom
May 4, 2019 at 12:29 pm
https://phys.org/news/2019-05-net-emissions-wont-uk-contribution.html
“The committee’s report highlights that the country’s territorial carbon footprint has fallen by 30% from 2008. But as Swedish campaigner Greta Thunberg highlighted to parliament, using this figure as a mark of the country’s climate leadership amounts to nothing more than creative carbon accounting, glossing over the UK’s role in emissions that occur outside its borders.
The UK economy is primarily driven by its service sector, and the value of its imports is roughly triple that of its exports. The production and transport of these imported goods are a direct consequence of the UK’s consumption habits, but these emissions aren’t counted by the committee because they occur beyond its shores. Including these emissions and excluding emissions from exports to other countries, the UK’s carbon footprint is 70% higher than the figure used by the committee.”
May 4, 2019 at 7:23 pm
It is not clear what the chart is measuring, yes much of U.K’s manufacturing has moved overseas, leaving service industries, also the accounting for fossil fueled exports is contentious (where should it be accounted for?). Instead of getting countries to change by guilt and competitiveness, the non-carbon producing alternatives need to be irresistible. When you look at the misery and health problems, fossils are creating around the world I would have thought that was indeed the case.
“Depending on who you ask, carbon emissions in Australia are either rising, or falling. What is undeniable is that recent increases in emissions from Australia’s fossil fuel exports dwarf any domestic reductions.
Global emissions released overseas from coal and gas exported from Australia have more doubled since 2000, and are now more than double Australia’s domestic emissions.”
https://reneweconomy.com.au/global-emissions-from-australian-carbon-exports-dwarf-any-domestic-cuts-36990/
May 4, 2019 at 8:49 pm
I just don’t like examples of self-deception. Humans are too darned good at it, and it doesn’t help. An actually honest accounting is needed.
Now, competitively (another thing humans are too darned good at), in the last decade the UK has been doing a number things much better than the States in regards to climate change – efficiency seems to have stuck there, and renewables are rising at a significant rate:
https://www.theguardian.com/environment/2019/jan/03/uk-power-stations-electricity-output-lowest-1994-renewables-record
There’s no doubt that’s part of the $ GDP to per capita carbon emissions figures there, especially since 2008. But since 1990? Please.
May 5, 2019 at 4:45 am
True, and UK aviation and shipping aren’t counted either. In 2006, 2 billion air passengers were carried worldwide. In 2019 it will be over 4 billion. Planes have got more fuel efficient, but fuel consumption still went up 50%, and a litre of fuel burnt above 30,000 feet altitude has three or four times the global warming potential of the same litre burnt at ground level. Much of this is due to water vapour, resulting from the oxidation of the hydrogen component of jet fuel. Water vapour doesn’t normally make it up into the stratosphere, and it’s a much stronger greenhouse gas than CO2, so switching aircraft to hydrogen, or biofuels for that matter, would have no benefit.
Ironically, shipping probably has a net cooling effect, even though it’s using one of the dirtiest fuels around. Ships burn bunker oil in huge two-stroke diesels. The oil is so thick, they have to heat it up before use to make it flow. But the sulfur particles from it form condensation nuclei in the exhaust, which can seed sunlight-reflecting clouds. You can see this in photos from space. https://www.nasa.gov/image-feature/summer-ship-tracks-in-the-pacific
May 5, 2019 at 12:34 am
More than an honest accounting – what’s needed is an appreciation that CO2 is global and so is climate; globally determined. I’m so tired of seeing these cherry-picked countries who have off-shored their carbon pollution and so look so sparkle-y in these biased cheerleading pieces. Climate cares about only ONE curve – and that’s the Keeling curve. The rest is a shell game. Jimbills is right.
The upshot is ONLY global economic numbers mean anything. And they have been faithfully showing the Garrett Relation
https://en.wikipedia.org/wiki/Garrett_relation
remains true, as the thermodynamics of civilization itself would indicate it should. Economic growth maintained? As if that’s a good thing??! Eternal growth on a finite planet is cancer, and kills the host. Not something we should desire unless our attitude, like the Republicans, is to get mine while the gettin’s still good, build my Silicon Valley bunkers for the hard times (with more square footage than Larry Ellison’s, just to prove we’re better) and to hell with our children. Growth WILL end, and increasingly highly likely it will not at all be graceful.
Oh sure, we’ll continue to spread renewables, and the day of oil and coal will eventually wind down and end, but far too late – after key tipping points are long since crossed and indirect carbon emissions from vanishing forests, soils, permafrost, and an ocean too hot to hold it’s existing store of our CO2 starts to give it back, as the corals and other aragonite species die. I don’t think when that day comes, we’ll be patting ourselves on the back any more about have cake/eat too economics pumpers.
May 5, 2019 at 12:59 pm
It should be taken as a given that we’ll maintain our growth fantasy. Absolutely no one in positions of power or even close to them is talking in a serious way about scaling back economic growth. Even here it’s an unpopular subject. Talk about it in public and you might as well be an ogre.
That said, the MOST aggressive plans for individual nations to maintain growth and reach a carbon-neutral status is by 2050, and this is limited to a handful of European countries and includes a lot of trickery to reach that. The world as whole, best case, and assuming growth doesn’t end before then by itself, would be a few decades afterwards. That’s IF we were really serious about the issue and worked really hard at it.
So, what’s that? 2-3 degrees C warming? Less aggressive 4-5 degrees?
I pretty much figure best case is around 3 degrees. I also think it’s a virtual certainty that we’ll try geoengineering. The catastrophes of warming will increase to the point that the public will be screaming for it, safe or not. That either works out, in which case we’d be tempted to slow down our carbon reductions, or it doesn’t, and who knows how that works out (multiple contradictory studies on it).
In any case, major change on a global scale. At that’s just climate change. We also have topsoil erosion, aquifer depletion, loss of water from glaciers, biodiversity loss (there’s a major report on that coming out tomorrow), possible resource scarcity, antibiotic resistance, and on and on. All of it because we can’t even consider ending growth.