Category: Energy Economics & Policy

Obama and Xi Breathe New Qi into Global Climate Talks

Context is everything in understanding the U.S.-China climate deal struck in Beijing by U.S. President Barack Obama and Chinese President Xi Jinping last week. The deal’s ambitions may fall short of what climate scientists called for in the latest entreaty from the Intergovernmental Panel on Climate Change, but its realpolitik is important.

Obama and Xi’s accord sets a new target for reductions in U.S. greenhouse gas emissions: 26-28 percent below 2005 levels by 2025. And for the first time sets a deadline for China’s rising GHGs to peak: 2030. This is potentially strong medicine for cooperation, when seen in the context of recent disappointments for global climate policy. Continue reading “Obama and Xi Breathe New Qi into Global Climate Talks”

by pfairley

EU Climate Summit Commits to 2030 Carbon Cuts

European leaders wrapped up a two-day climate summit in Brussels last week with a deal to cut the European Union’s total greenhouse gas emissions to 40 percent below 1990 levels. This would continue a downward trend – the EU is already on track to meet a 20 percent reduction from 1990 levels by 2020 – but the agreement is weak relative to Europe’s prior ambitions to confront climate change.

Investors in green tech pushed aggressively for the deal, seeking a longterm signal that the European market will continue to reward advances in energy efficiency and low-carbon energy production. The deal is also a shot in the arm for the Paris global climate talks, scheduled for December 2015, which will seek to achieve the decisive binding global targets for greenhouse gas reductions that failed to emerge from the 2009 Cophenhagen climate talks.

What the deal lacks is specificity and ambition regarding the mechanisms by which European countries are to achieve the carbon reduction. “Key aspects of the deal that will form a bargaining position for global climate talks in Paris next year were left vague or voluntary,” reported The Guardian. Continue reading “EU Climate Summit Commits to 2030 Carbon Cuts”

by pfairley

Minnesota Finds Net Metering Undervalues Rooftop Solar

Utilities should be paying more for their customers’ surplus solar power generation according to a solar pricing scheme approved by Minnesota’s Public Utility Commission last month and expected to be finalized in early April. Minnesota’s move marks the first state-level application of the ‘value of solar’ approach, which sets a price by accounting for rooftop solar power’s net benefits, pioneered by the municipal utility in Austin, TX.

Minnesota is one of 43 U.S. states that requires utilities to pay retail rates for surplus solar power that their customers put on the grid. Utilities across the U.S. are fighting such net metering rules, arguing that they fail to compensate the utility for services that their grid provides to the distributed generator. So last year pro-solar activists and politicians in Minnesota called the utilities’ bluff, passing legislation tasking the state’s Department of Commerce with calculating the true value of rooftop solar power. Continue reading “Minnesota Finds Net Metering Undervalues Rooftop Solar”

by pfairley

EC Sees Heavy Pricetag to UK Nukes Plan

UK prime minister David Cameron at Hinkley Point
UK prime minister David Cameron at Hinkley Point

Government incentives for a pair of proposed nuclear reactors could cost U.K. taxpayers as much as £17.62 billion, thus exceeding the reactors’ projected cost. The EC figure is a preliminary estimate included in an initial report to London published on Friday by European Commission competition czars. The letter notifies the British government that—as we predicted in December—Brussels is launching a formal investigation to assess whether the subsidies violate European state aid rules.

The preliminary findings suggest that the U.K. and E.C. are on a collision source. As the Financial Times summed it up this weekend: “The severity of [the EC’s] initial concerns will cast a shadow over government hopes to win approval for the deal.”

Continue reading “EC Sees Heavy Pricetag to UK Nukes Plan”

by pfairley

The Debate: Fracking and the Future of Energy

France 24 Energy in 2013 DebateThe Arctic is melting faster than predicted. Is now the time to shut down the low-carbon nuclear power plants in France — the 20th Century’s staunchest proponent of nuclear energy? Is natural gas produced via hydraulic fracturing or ‘fracking’ a gift that is buying time for a transition to renewable energy or a curse that reinforces fossil fuel dependence? Will carbon belching heavyweights such as the U.S. and China ever get serious about cleaning up their energy systems?

Such questions are top order in France, whose President kicked off a Grand Débat on energy this month Continue reading “The Debate: Fracking and the Future of Energy”

by pfairley

The Inconvenient Science of Biomass Power

New science confirms that burning trees to produce power instead of coal may be a losing strategy for combatting climate change.

In my April 2012 Spectrum news article on the questionable carbon benefits of largescale biomass power generation, I identified a boom in exports of wood pellets from the U.S. Southeast to Europe, where they are fast becoming a crucial energy supply for power firms seeking to meet the European Union’s renewable energy and carbon reduction mandates.

Forbes Magazine greentech columnist (and friend) Erica Gies noted my analysis in a May 22 blog post, Massachusetts Addresses “Biomass Loophole” and Limits Subsidies, about recently-issued regulations that set higher standards for biomass power plants seeking state-issued renewable energy certificates. Continue reading “The Inconvenient Science of Biomass Power”

by pfairley

Corporate Fleets: No Magic Sponge for Electric Vehicles

Despite the high levels of excitement surrounding electric vehicles, there is reason to worry about this nascent market’s capacity to fizzle in a big way. Most of the buzz surrounds electric vehicle introductions from major automakers, such as the Nissan Leaf and the Chevy Volt, for which consumer demand remains to be demonstrated. Today I’ve got a piece running at MIT’s TechReview.com site raising doubts about the likelihood that corporate fleets will soak up EVs if consumers leave these pricey machines languishing on showroom floors.

The TechReview story, a ‘news-you-can-use’ piece aimed at managers, concludes that big price reductions and adjustments to fleet management practices will be needed to make a business case for replacing gasoline and diesel fleet vehicles with EVs. In short, lithium battery costs push the purchase price too high for most corporate buyers to recoup their investment through efficiencies — especially if they continue to replace vehicles every three-to-five years. AT&T predicts a return on electric Ford/Azure Dynamics service trucks they are phasing in, but only because the company bucks standard fleet practice and uses its fleet vehicles for 10-12 years. Continue reading “Corporate Fleets: No Magic Sponge for Electric Vehicles”

by pfairley