14 January 2016, Energy Post, The oil pricequake will doom the global political order. Given the centrality of oil and oil revenues in the global power equation, it is inevitable that depressed oil prices will doom the current global political order, writes Michael T. Klare, a professor of peace and world security studies at Hampshire College. Political turmoil is already raging across the oil heartlands of the planet – and the tremors from the oil pricequake have yet to reach their full magnitude, notes Klare. As 2015 drew to a close, many in the global energy industry were praying that the price of oil would bounce back from the abyss, restoring the petroleum-centric world of the past half-century. All evidence, however, points to a continuing depression in oil prices in 2016 – one that may, in fact, stretch into the 2020s and beyond. Given the centrality of oil (and oil revenues) in the global power equation, this is bound to translate into a profound shakeup in the political order, with petroleum-producing states from Saudi Arabia to Russia losing both prominence and geopolitical clout. To put things in perspective, it was not so long ago – in June 2014, to be exact – that Brent crude, the global benchmark for oil, was selling at $115 per barrel. Energy analysts then generally assumed that the price of oil would remain well over $100 deep into the future, and might gradually rise to even more stratospheric levels. Such predictions inspired the giant energy companies to invest hundreds of billions of dollars in what were then termed “unconventional” reserves: Arctic oil, Canadian tar sands, deep offshore reserves, and dense shale formations. It seemed obvious then that whatever the problems with, and the cost of extracting, such energy reserves, sooner or later handsome profits would be made. It mattered little that the cost of exploiting such reserves might reach $50 or more a barrel. Read More here
Category Archives: The Mitigation Battle
14 January 2016, New York Times, In Climate Move, Obama Halts New Coal Mining Leases on Public Lands. The Obama administration announced on Friday a halt to new coal mining leases on public lands as it considers an overhaul of the program that could lead to increased costs for energy companies and a slowdown in extraction. “Given serious concerns raised about the federal coal program, we’re taking the prudent step to hit pause on approving significant new leases so that decisions about those leases can benefit from the recommendations that come out of the review,” said Interior Secretary Sally Jewell. “During this time, companies can continue production activities on the large reserves of recoverable coal they have under lease, and we’ll make accommodations in the event of emergency circumstances to ensure this pause will have no material impact on the nation’s ability to meet its power generation needs.” The move represents a significant setback for the coal industry, effectively freezing new coal production on federal lands and sending a signal to energy markets that could turn investors away from an already reeling industry. President Obama telegraphed the step in his State of the Union address on Tuesday night when he said “I’m going to push to change the way we manage our oil and coal resources so that they better reflect the costs they impose on taxpayers and our planet.” Read More here
3 January 2016, Client Earth, End of business as usual for carbon intensive industry. Scrutiny of carbon intensive companies’ reporting could mean an unprecedented number of complaints to financial regulators from environmental lawyers ClientEarth in 2016. ClientEarth will be poring over annual reports of carbon intensive UK and EU companies and reporting them to the Financial Reporting Council if they are failing to disclose to investors how the post COP21 business outlook could affect their operations. The agreement aims to limit the global temperature rise to 2 degrees Celsius, with an ambition for 1.5 degrees. It will have a huge effect on companies in carbon intensive sectors such as energy, mining and utilities. Dave Cooke, Company and Financial lawyer for ClientEarth, said: “The Paris agreement represents a huge change for the world. We are now in a transition to a low carbon economy. Business as usual is no longer an option for carbon intensive companies. “We will be looking at how those carbon intensive companies disclose the risks that they face and where they’re not disclosing them effectively and appropriately we will submit complaints to the regulator to take action.” The move comes amid growing consensus in the business community that climate change is changing the landscape beyond recognition. Mark Carney, the Governor of the Bank of England, made a major intervention in September, when he identified climate change as one of the biggest risks to economic stability. Read more here
31 December 2015, Climate News Network, Paris fails to revive the nuclear dream. Charlatans, or planetary saviours? Post-Paris views on the nuclear industry suggest few experts believe it will bring closer a world rid of fossil fuels. In Paris, in early December, the advocates of nuclear power made yet another appeal to world leaders to adopt their technology as central to saving the planet from dangerous climate change. Yet analysis of the plans of 195 governments that signed up to the Paris Agreement, each with their own individual schemes on how to reduce national carbon emissions, show that nearly all of them exclude nuclear power. Only a few big players – China, Russia, India, South Korea and the United Kingdom – still want an extensive programme of new–build reactors. To try to understand why this is so the US-based Bulletin of the Atomic Scientists asked eight experts in the field to look at the future of nuclear power in the context of climate change. One believed that large-scale new-build nuclear power “could and should” be used to combat climate change, and another thought nuclear could play a role, although a small one. The rest thought new nuclear stations were too expensive, too slow to construct and had too many inherent disadvantages to compete with renewables. Industry in distress Amory Lovins, co-founder and chief scientist of the Rocky Mountain Institute, produced a devastating analysis saying that the slow-motion decline of the nuclear industry was simply down to the lack of a business case. The average nuclear reactor, he wrote, was now 29 years old and the percentage of global electricity generated continued to fall from a peak of 17.6% in 1996 to 10.8% in 2014. “Financial distress stalks the industry”, he wrote. Lovins says nuclear power now costs several times more than wind or solar energy and is so far behind in cost and building time that it could never catch up. The full details of what he and other experts said are on the Bulletin’s site, with some of their comments below. Read More here