Triple Crunch Log Jeremy Leggett

6.6.00. Exxon-Mobil CEO denies link between oil burning and global warming at his company’s AGM this week. “We look at statistics. We look at science,” Lee Raymond says.

2
“The micropower revolution could be every bit as dramatic as the revolution that hit the world’s telecommunications industry in the 1980s.”
The Economist

August 2000

5.7.00. BP rebrands as “Beyond Petroleum.” A worldwide advertising campaign stresses solar and downplays oil. Double page adverts fill the national newspapers. The new logo, a green, yellow and white exploding sunflower, has a page all of its own. Sparse copy on the facing page tells the world that the oil giant has become “a new company offering global energy solutions.” This is why, as sentence 5 of just 7 reminds us, BP is among other things the world’s leading producer of solar power. As for what BP now stands for? “Beyond Petroleum.” Newpaper articles about the rebranding, including front-page coverage, tell us that the company will spend over $100 million on rolling out the repositioning campaign this year. For comparison, total investment in renewables over the next three years - mostly in BP Solarex - will be $500 million. Among the 96 words in the ad, the word “oil” does not feature once. BP now has 28,000 service stations: more retail sites than MacDonalds, and every one of them built on oil. It has a market value of $200 billion, built up over more than a century on oil.

28.7.00. Bank Sarasin decides to set up the world’s first private equity fund for renewables investment. This is the outcome of a March 1998 proposal by Solarcentury (initially to Bank Baer) to set up a dedicated solar PV fund.

1.8.00. The insurance industry is still making huge losses from disasters, and yet investing vast amounts in fossil fuels. Munich Re’s annual report on 1999’s disasters shows insured losses came to $22 billion, second only to 1992’s figure of $26 billion (in 1999 dollars). Economic losses exceeded $100 billion. There were five individual billion-dollar insurance losses, the biggest being the European gales at the end of December, which clocked up $5 billion.

4.8.00. Economist front-page feature this week concerns “The Electric Revolution.” The micropower revolution, the editorial says – an explosion in use of fuel cells, solar PV, and gas microturbines - “could be every bit as dramatic as the revolution that hit the world’s telecommunications industry in the 1980s.”

The western United States is in the grip of a terrible drought. Water is running out in Texas. In California, with demand for electricity soaring, America’s most populous state is at the brink of a breakdown in its power supply. For three straight days it has nearly run out of power. Rolling blackouts may yet be required.

16.8.00. Hot weather in California has brought the electrical capacity shortage to a head. There have been rolling brownouts across the state, with speculation that the state’s high tech businesses could suffer badly if the problem is not fixed. Deregulation is being blamed. The state regulators required the utilities to sell off their generating capacity to out-of-state energy companies, and cap their retail prices. The new generators, it was assumed, would bring wholesale prices to the utility down because of competition. It must have seemed like a good idea at the time.

20.8.00. A Russian icebreaker has found a mile of open water at the North Pole. The last time there was water at the pole was 50 million years ago. This news makes the front pages today. Sky news features Fred Singer, one of the most accomplished climate deniers funded by fossil-fuel companies, querying whether it has anything to do with global warming.

1
“The Stone Age came to an end not for a lack of stones and the oil age will end, but not for the lack of oil.”
Sheik Yamani

September 2000

.9.00. The price of oil has trebled in just over a year. Eighteen months ago the real price of crude oil was its lowest in postwar history. For a time in 1999 it was actually one half of the real price of oil in the fifties, and one fifth of the real oil price at the beginning of the 1980s. The Saudi’s have asked for joint action by producers and consumers to bring the price down. How will the new economy react? There have only been three other occasions in history when prices have risen so dramatically: 1974, 1979 and 1990. Each time the UK economy hit the rocks of recession within 18 months. “I do not subscribe to the new economy view,” a Professor of economics writes in the Observer. “Look at the statistics. A modern economy runs on petrol and aviation fuel.” And it cannot take an old-fashioned oil shock, he insists. He points out that electricity prices tend to follow a smoothed curve mirroring the oil price, because of the effect of the latter on the price of gas and coal. Unemployment rises with an 18 month delay behind a soaring oil price.

3.9.00. Sheik Yamani tells Reuters that OPEC is accelerating the end of the oil era. Now 70, the man who was Saudi oil minister at the time of the ’74 and ’79 oil crises, says: “OPEC has a very short memory. It will pay a heavy price for not acting in 1999 to control oil prices. Now it is too late. The Stone Age came to an end not for a lack of stones and the oil age will end, but not for the lack of oil.” He fears the west will go all out for fuel-cell and other non-gasoline engines. “Technology is the real enemy for OPEC,” he said. “The real victims will be Saudi Arabia with huge reserves they can do nothing with – the oil will stay in the ground forever.”

7.9.00. The price of oil has reached $34 a barrel, a ten year high. Oil analysts are saying a $40 barrel cannot be ruled out. In Washington Bill Clinton raises the prospect of recession as a result of the high oil price with a Saudi Crown Prince. The Saudi government has promised to hike production.

Shell and other oil companies, meanwhile, have responded by putting prices up 2p at the pump. The government is also involved in high oil price at the pump. UK Treasury levies on petrol are 75% - the highest in Europe.

Protests in France seeking fuel tax cuts spread to the UK. French hauliers have been blockading fuel depots, and now 80 percent of the country’s petrol stations are empty. The government is holding crisis talks with truckers organistions. In the UK, farmers and truckers stage a blockade of a Shell refinery at Stanlow in Cheshire.

8.9.00. Only 40 farmers and hauliers are causing havoc at the blockaded Stanlow refinery. Three tractors blocking a side entrance have been moved on by police. Nontheless, 60 of Shell’s tankers have remained behind the wire. The company is saying it is too dangerous for them to move. However, there are no reports of violence - at least on levels the police couln’t easily deal with - in the papers. A wave of share-selling is underway, however, as dealers conflate the high oil price with corporate profit warnings.

Petrol stations across the north of the country begin running out. Fifteen main refineries in the UK supply 80 percent of the fuel used. If the truckers can stop supplies there as easily as they have at Stanlow, they may well repeat what the French have done. The French government has been forced to give in, and promise cuts in fuel duty. Shell is still saying that it is too dangerous for its drivers to leave, but there is no evidence for that. And now the truckers are also blocking a Texaco refinery in south Wales.

9.9.00. More than a hundred filling stations have run dry. Refineries in Wales and Humberside are now under siege, plus distribution depots in the Midlands, Bristol and Manchester. OPEC ministers met in Vienna at the weekend and agreed to hike their production by 3 percent, 800,000 barrels per day, in an effort to bring prices down. But it seems to be their own governments that European truckers are annoyed with, not the producing countries or the oil companies. Blockades have spread to Germany.

12.9.00. The oil companies are now saying that they expect most UK filling stations to run dry by the weekend.

The Prime Minister spends the afternoon on the phone to the bosses of the big five oil companies, asking them to tell their tanker drivers to roll, guaranteeing that the police will protect them. Press reports say that government ministers are privately fuming, saying the oil companies are deliberately sitting on their hands. A Home Officer advisor, Lord Mackenzie - a former senior police officer – tells the press: “Roads are often not blocked. If they were, the police would not hesitate in arresting people. It seems to be the companies are causing the difficulty, and there does seem to be some collusion with the protestors. Perhaps it’s because if the fuel duty was reduced they would sell more petrol.” On top of police action, the companies could take out court injunctions to remove protestors from their depots and refineries. They haven’t done so. Instead, Shell has been handing out hot coffee and refreshments at Stanlow. “They are right behind us,” one haulier tells the FT. A Shell spokesperson, asked what the continuing danger was to drivers that kept the tankers idle, tells a reporter that a traffic cone had been thrown against a tanker last Friday.

13.9.00. 90% of UK filling stations have run out of petrol: the country is 2 days away from food shortages. Panic buying has started at supermarkets. Buses, trains and schools have been affected. The National Health Service is facing crisis, having to cancel operations. It is stunning to see the stark evidence of how dependent a nation has become on oil, and more than that, just-in-time delivery of oil. Today the Prime Minister has gone beyond phone calls. He calls nine oil company bosses in to Downing Street to exhort them to get their tankers on the road. To this meeting with a head of state Shell had the decency to send their UK Chief Executive, Malcolm Brinder, but BP sent a Vice President. After the meeting, the oilmen read out a statement on steps of Number Ten that falls well short of an assurance that their tankers would start moving again. They say they still have fears for the safety of their drivers.

The UK government moves 80 military tankers filled with Ministry of Defence petrol into readiness to cover essential services. The health service is on red alert. Supermarkets have begun rationing bread. Companies, unable to operate production lines, are sending workers home. The Prime Minister, thinking he had talked the oil companies into action, and having told the nation then that the crisis was 24 hours from resolution, now admits that we face a national crisis.

Tanker drivers say they have been explicitly ordered not to go through demonstration lines, even when police have cleared the streets. Both BP and Shell drivers tell the Guardian this. The oil companies have been denying that they are encouraging the protestors in any way. This doesn’t sit too comfortably with John Browne’s speech when BP announced its half-yearly results in August. Then he said: “We are all motorists and clearly people are very concerned, especially when they look at prices in other parts of the world and feel very hard done by. We share that concern.” Now the companies are playing the game they have learned is the most effective at dealing with potentially embarrassing episodes: failing to respond to media requests for interviews. Newspaper reports say that government spokespeople are now hinting at reprisals.

Finally the environment groups have joined the debate. A letter in the Guardian from Friends of the Earth’s director, Charles Secrett, extolls the need for high fuel taxes, notes the government is sitting on £4 billion of unexpected oil tax revenues because of the high oil price, and urges them to spend it on public transport.

The stock market continues to slip, for the sixth successive day in the case of the FTSE. The long petrol queues are unsettling dealers. One tells the FT: “These are things that everyone thought were consigned to the past.” The OPEC decision to hike production is having no immediate affect. An analyst from Goldman Sachs says the oil price could rise to $70 per barrel over the next year.

14.9.00. The Chancellor announces that he won’t give in to the fuel tax protestors, even though polls are showing the protest commands huge public support. The government has made no reference to global warming, or indeed any environmental issue, on defending the existing tax take.

The Daily Mail exhorts the truckers to back down, in a front page headline, making it clear meanwhile that the paper supports their campaign.

Tankers are on the move. The oil companies are saying it will be three weeks before the country’s supplies are back to normal, however.

Analysis of the crisis has started, and finally the environment is figuring. “Do puny governments hold sway any longer over these global energy corporations?” an editorial in the Guardian asks today. “The environmental project that flowered in Rio and Kyoto is parched. Getting ordinary people to change their daily behaviour for the sake of the planet now looks more difficult than ever.” The cartoon of the day shows a fat trucker driving a tanker with all the oil company logos splashed on it, including BP’s sunflower. An cat, even fatter and dressed in a suit, sits with its arm round the driver, with its paw stuck out of the window, and a single claw stuck in the air. A miniature prime minister rides on the bumper of the tanker as a mascot.

20.9.00. The Guardian carries a full page Solar Century ad: “Call that a fuel crisis?” Then small wording: “You thought last week was bad. If we keep relying on fossil fuels the resulting global warming will kill more people than all the twentieth century’s wars put together. Britain’s only hope is to invest in sustainable forms of energy. Something the governments of Germany, USA and Japan have already recognised. To date our environmental investment has been almost non-existent. Unless we do something soon it’s clear we’ll have more than the price of petrol to worry about. To find out more about solar power…”

23.10.00 The world’s investment for quoted renewable energy stocks floats: the Merrill Lynch new energy fund. Even though tech stocks are in the midst of a terrible slide, the offering is oversubscribed. I have invested what meagre savings I have in the fund.

24.10.00. Tony Blair gives a disappointing first speech on the environment: a predictable call for greens and business to work together, and £100 million of new money, £50 million for an ill-defined “carbon trust” mostly to promote wind power and £50 million for more research into renewables.

30.10.00. Dozens of UK rivers break their banks, thousands of trees are down nationwide, and almost no trains were running during the morning. Hundreds of homes are flooded, with people wading through their lounges, often amid human sewage that has spilled from drains. Lifeboats are rescuing stranded people 30 miles from the sea.

31.10.00. The front page headline in the Guardian today reads “Global warming: it’s with us now.” Yesterday’s news was replete with references to climate change, and government ministers are among those running the line. Insurers are saying the storm is the third worst insurance loss ever in the UK, with early estimates already at £500 million, and they too are openly blaming global warming.

2.11.00. The UK floods are the worst for 50 years. Shrewsbury, a large town, is cut off. A hospital has to be evacuated. Ten thousand families in Kent are told to boil water because bacteria has been found in it. Estimates of the final insurance bill now exceed a billion pounds. The Prime Minister visits the flooded area in Worcestershire, looking appropriately worried. “We have to work to deal with the issue of climate change,” he says.

The government looks like they will tough it out against the truckers. They have no intention to drop fuel taxes, it seems, and are mobilising the army to drive oil tankers if the truckers disrupt the refineries as they have threatened to do on 13^th. The truckers have threatened that 25,000 crawling lorries will converge on London if the government doesn’t cut fuel tax by 26p a litre.

Shell declares record third quarter profits - £2.1 billion, or £25 million a day. A 100 MW solar PV manufacturing plant every three days, in other words.

4.11.00. The connection between floods and the greenhouse effect is being made everywhere now. Even the Sun newspaper mentions global warming. The worst case is out in the open too. Previewing the climate summit, a long article in the FT mentions the “remote but real” possibility that warming could trigger a runaway greenhouse effect.

6.11.00. Another storm dumps 34 mm of rain on the southwest, and up to 40 is expected in most areas under its path today. There are 81 flood warnings across the country, 21 of them severe. The cartoonists are having a field day. One shows a group of placard-carrying truckers up to their knees in water demonstrating in favour of cheaper global warming.

Prince Charles blames the storms on humanity’s arrogant disregard for nature in a speech. Support for the truckers is falling, meanwhile: down to 55% from 80% during September’s protests.

The US election is finished, but seemingly not yet over. Of the quarter billion people in America, 48 million voted for Gore, and over 47 million voted for Bush. Bush seems to have won by a whisker, because of state-by-state results – the so-called electoral college system. Florida – the home of Mickey Mouse, and the American state most threatened by global warming – has turned out to be the key state. There is to be a recount there, the result was so close.

7.11.00. Most of the UK’s major rivers have made use of their floodplains now, notably the Severn, Ouse, and Derwent. Virtually every area of England and Wales is under threat, the environment agency warns.

BP joins Shell in announcing record third quarter profits: bigger than Shell’s at £2.7 billion. CEO John Browne insists that they are a “taker, rather than maker” of prices, and his deputy, Rodney Chase, tells the world that profits from petrol stations are actually “wafer thin.”

Oil prices remain high. An analysis in the FT speculates that “this may turn out to be the first ever oil shock that the world economy manages to survive.”

8.11.00. Chevron takes over Texaco: another monstrous merger of two already giant oil companies. Ninety years after they were all sundered by anti-Trust regulators, these giants are being allowed to merge again into machines more powerful than the great majority of governments.

9.11.00. The UK Chancellor has knocked 8p off a litre of petrol. It is not enough for the protestors. They are going ahead with their truck convoy, they say.

Latest Met Office climate model factors in soil feedbacks and shows horrific warming. Global average temperature at the end of the next century, assuming no cuts in fossil fuel burning, and factoring in feedbacks from bacteria in warming soils and from drying tropical forests, rises up to 6 degrees C in the next century, 2 degrees higher than previous forecasts. Michael Meacher described this as “mind blowing.” A significant corollary of the Met Office work is that forests planted in Alaska, Canada and Siberia may actually make global warming worse.

10.11.00. 3,000 homes have been flooded. The sandbags are out even along “Millionaires Bank” on the Thames. The ten percent of the UK population that lives on floodplains is living in misery and fear. A toxic waste dump in the Severn Valley is under threat. Production at the UK’s largest coalfield has virtually ceased since its own powerplant was flooded. Railway lines still closed include the main London to Brighton line.

78 percent of British people now think that their families will be affected by climate change over the next few decades, an opinion poll shows. But it also shows wisedpread ignorance – still – about what is causing it. Only two thirds think cars contribute. Less than one in five associate greenhouse gases with domestic appliances.

12.11.00. The fuel protest has evaporated. Instead of 25,000 lorries, a maximum of 40 headed for London, massively outnumbered by police. The environmental protestors in favour of higher fuel taxes were there this time. Greenpeace used a bio-diesel truck towing a solar generator to brew tea for the protestors. “People who want higher fuel taxes are like turkeys campaigning for Christmas,” an ex colleague told the press.

13.11.00. The annual climate summit opens in The Hague. European Union environment ministers have decided to present a united front to the Americans and demand that tough rules remain in place, by which they mean the need for at least half emissions reductions to be achieving at home, and as real emissions cuts, not by simply by counting carbon sequestrataion in in-country sinks - forests and grasslands. America wants much of their their commitment allowable against sinks at home and overseas projects - both sinks and emissions cuts – abroad. Environmental groups have calculated that under current US proposals, not a single tonne of real fossil fuel burning would have to be cut in America.

24.11.00. Loan insurer warns delegates at the climate talks that currnt trends mean economic disaster. Andrew Dlugolecki, a recently retired executive from CGU, has long been an advocate of action on global warming. He warns that in a world doing nothing about greenhouse gas emissions net wealth destruction would exceed net wealth creation by 2065 or thereabouts, assuming no crash in the world economy. His argument is is based on simple trends: the cost of climate-related disaster is rising at ten percent per year, and the world economy is growing at three percent.

27.11.00. The climate talks collapse. The British make a last ditch effort to cut a deal with the Americans, conceding them the ability to watch their trees grow and count that against Kyoto targets. But other Europeans, notably France, Germany and Denmark, decided it ceded too much: that no deal was better than one leaving the Kyoto Protocol - already barely a first step to a solution - as a treaty not worth the paper it was written on. The UK delegation is saying that another half day might have been enough time to zero in on a deal. But the conference hall was booked for an oil industry congress.

13.12.00 Bush has finally won the election, though Gore won the national popular vote by 337,000. Bush was handed the electoral college by the Supreme Court. Judges appointed by his father stopped the recount in Florida, a state with slack electoral practices governed by his brother. In that state, with 6 million votes cast, Bush won supposedly by a majority of 154. Anguished Democrats blame Ralph Nader for taking 95,000 green votes in Florida that could have gone to Gore.

2.1.01. George Soros has predicted a bust on the horizon - an unavoidable hard landing for the US economy in 2001. Nasdaq’s fall has now involved a loss of value of more than half the April 2000 figure.

At least 210 internet companies went bust in the dot.bomb holocaust last year, more than one a day in the last quarter. Today, Letsbuyit.com has added its name to the list, without a last-minute name change to Cantsellit.com. Business Week, its eulogising about the new economy and dotcomism of less than a year ago long forgotten, is now featuring articles about where to look for investment boltholes in the downturn. One article, entitled “After the Bubble Bursts,” includes among a clutch of “old economy” powerhouses such as insurance giant Axa an interesting recommendation: wind energy.

5.1.01. Bank of America shares suspended on the New York stock exchange. The rumours say it faces huge debt losses. Including money loaned to electric utilities.

6.1.01. California’s energy problems, last evident during the hot summer, resurface in world news, this time as a result of a bitter November and December. Now the energy shortage has assumed the proportions of a a full-blown crisis. Nobody has built a power plant in the state for ten years. Wholesale prices have increased tenfold from their level a year ago, over which time gas prices have increased steeply because of shortages. Utility giants Pacific Gas and Electric and Southern California Edison, who dominate California’s power supply, are facing bankruptcy because they have clocked up multi-billion dollar bills with generators and do not have the cash to pay. They have not been able to hike their retail prices to make the books balance because that is the one thing that California’s strange version of deregulation does not allow them to do because retail prices are capped.

Alan Greenspan, Head of the Federal Reserve, cut US interest rates this week: a rare event. There is some speculation that he must know of something really bad in the offing, maybe another Long Term Capital Management-type collapse.

AstroPower has signed a deal with Shea Homes – tenth biggest American builder – for at least 100 solar PV houses in the San Diego area.

17.1.01. The Governor of California has declared a state of emergency. The world’s tenth biggest economy is in crisis because it cannot provide enough power! Bitter cold weather has coincided with the shutdown for maintenance of almost a third of the state’s creaking power plants. In Silicon Valley, firms like Apple and Hewlett Packard have lost power. Office computers have crashed, people have been trapped in elevators without power, hospital emergency rooms have closed, traffic has jammed at crossings with no lights. Pacific Gas and Electric and Southern California Edison have both had their debt and credit ratings reduced to junk status. Intel’s CEO, Craig Barrett, tells reporters: “Would I okay the expansion of anything in Silicon Valley right now? Not a chance.”

CNN’s Industry Watch website reports a sudden increase in interest in solar PV systems. A Kyocera spokesman reports that “some people are really irate and want to do something to get back at the utilities.” Solar contractors doing installations are booked solid for months ahead. Another new player in the solar market today. Schott Group, a German glass outfit with $1.8 billion in sales last year, has bought 100% of US PV installation company Applied Power Corporation for an undisclosed sum.

21.1.01. George W. Bush’s inauguration: a former oil executive now leads the most oil-addicted nation. The US imported 36 percent of its oil when the 1973 oil crisis struck, and yet has since allowed those imports to grow to 54 percent today. The average gasoline consumption last year was 24 miles per gallon – the lowest for more than a decade. The new President is a man who believes that science can deliver him an impenetrable anti-missile defence shield across America, and yet not tell us anything worth worrying about when it comes human-enhancement of the greenhouse effect. A man who executed 150 people while he was Governor of Texas, notwithstanding ample evidence of dubious convictions. A man who leads a party that refuses to participate in the International Criminal Court (ICC), placing it squarely in a refusenik group including Iran, Iraq, and Libya.

22.1.01. BP is closing 5,000 of its 28,000 petrol filling stations worldwide. The £129 billion corporation will raise £1 billion over 3 years in so doing. An easy way to pay for a rebranding.

AstroPower’s stock vacilates wildly: it has moved from $6 at the start to 46, back to the low 20’s, then soaring to the high 60’s, back to 28, up to 40, and back again to 28.

George Bush’s first day in the White House yesterday is an interesting one. He announces that he will move with intent and speed to open up the Alaskan wilderness for oil drilling. An oil spill disaster promptly hits the Galapagos Islands. The spill was from a tanker that hit rocks 3 days ago and began leaking 150,000 gallons. Rare animals are being evacuated from coastal areas of the islands.

The IPCC releases its worst-ever warning about global warming. The 3^rd IPCC scientific assessement report, finalised by 230 scientists from 99 countries in Shanghai, has been much leaked over the past few months. Nonethless it reaches the top levels of world news: on the front pages of the New York Times and the Washington Post. The final language has been toughened. Of the observed global average temperature increase over the last 50 years, it says: “most of the warming is attributable to human activities.” The October draft referred to human activities having “contributed substantially.” None of which is the main point. The future estimate has gone up from 1.0 to 3.5 degrees C by 2100 in the 1995 report to 1.4 to 5.8 degrees in this one.

30.1.01. This month Sharp announced plans to build another PV production line by May this year, increasing its capacity from 54 MW to fully 94MW, and investing $48 m in doing so. In 1996, just five years ago, Sharp’s capacity was 2.5 MW. 94 is almost half the total global market for 1999 in a single factory.

This month the Global Climate Coalition winds up. As a Greenpeace spokesman sees it, “the last stronghold to prevent progress on global warming” has gone. “Now President Bush and Exxon stand alone.” The Coalition’s spokesman says: “We have achieved what we wanted to accomplish with the Kyoto Protocol.”¹


2.01. Oil companies face a record number of shareholder resolutions on global warming at AGMs.

DTI announces a “major” PV demonstration programme (MDP).

3.01. America pulls out of Kyoto Protocol.

8.01. Congress kills fuel efficiency measures for SUVs.

11.9.01. WTC terrorism changes the world.

31.10.01. Enron reveals a formal SEC investigation is underway on allegations of accounting irregularities. The shredding of documents begins at Arthur Anderson.

11.01. Governments vote in Marrakech to continue Kyoto process without USA.

Enron files for bankruptcy.

“Cheney made millions off oil deals with Hussein.”

UK Strategic Energy Review, in which more than 60 companies and all relevant ministries participate, is positive for renewables.

8.2.02. Andrew Fastow, Enron CFO, refuses to testify before a Congressional panel. Jeff Skilling, CEO, does testify. Four days later Ken Lay also refuses to testify.

2.02. Exxon boss Lee Raymond says climate change is a “legitimate concern” and that reducing the scientific uncertainties is important.

3.02. “Staggering” Antarctic ice shelf collapse.

Lawyers gather for first climate litigation conference.

26.6.02. SEC files fraud charges against Worldcom.

8.7.02. Former Worldcom CEO Bernard Ebbers says he did nothing wrong and refuses to testify. Ex CFO Scott Sullivan also refuses.

21.7.02. Worldcom files for Chapter 11, then the largest bankruptcy in corporate history.

2.10.02. Fastow is chargegd over Enron’s collapse.

4.02. Exxon ousts IPCC Chairman using White House.

11.02. UK government’s Renewables Advisory Board set up

1.03. US & UK build up to war with Iraq.

Oil price hits $30.

2.03. UK Energy White Paper favours renewables and solar and commits to 60% CO2 cuts by 2050.

3.03. US & UK invade Iraq.

4.03. Exxon announces record profits.

5.03. Exxon backing for climate sceptic groups exposed.

Exxon CEO tells AGM profits come before “social statements”

19.5.03. Worldcom settles SEC charges resulting from its accounting irregularities.

6.03. Greenspan says US can’t depend on falling Canadian gas imports: LNG facilities must be built for imports.

7.03. CERES accuses top emitting companies of not disclosing climate risk.

8.03. BP, Shell and Chevron-Texaco wins Iraqi contracts.

Hottest summer on record by far in Europe.

A quarter of French nuclear stations shut down due to overheating.

Iraqis start attacking electricity and oil pipelines.

North American power blackout, 21 plants go down on East coast.

Former Energy Secretary says US “is a superpower with a Third World grid.”

Half billion dollar loss of tax income from one day without power.

Grid failure in London.

10.03. River Rhine nearly dries up in prolonged drought.

^t Eleven US states sue federal government to control greenhouse gas emissions.

American consumer payments for ME oil reach $7 trillion.

California wildfires at record levels after prolonged drought.

Arctic ice has thinned from 4 to 2.7 m on average in last 30 years, scientists say.

11.03. $16 trillion investment needed to meet two thirds rise in energy demand by 2030, IEA says ….$3 trillion of this for oil.

12.03. Russia refuses to ratify Kyoto Protocol, meaning not enough ratifying countries for it to come into force.

China faces severe power shortages.

Old people dying in thousands in the UK for want of energy efficiency.

1.04. The oil price began to climb with a vengeance in 2004. The sequence of major events, and how people and institutions reacted to them, suggest much to us about the not-too-distant future. Mixing major developments on global warming into this account of very recent history is also instructive, in that viewing the two together gives us a feel for how they might conflate in the coming energy crisis.

Winter 2004: discontent and lies

2004 opened with a blasé announcement by Shell in January that it might have overstated its reserves by 20 percent, or some 3.9 billion barrels. The Chairman of the Committee of Managing Directors, Sir Phillip Watts, did not even make the announcement himself. Major shareholders immediately called for his resignation.²

Meanwhile, the UK government’s Chief Scientific Adviser, Sir David King, was also making headlines by attacking the US over global warming. “In my view, climate change is the most serious problem we are facing today,” he reasoned, “more serious even than the threat of terrorism.”³ Later that month, it emerged that the Pentagon had been busy researching the same line of thought. An internal study found its way to Fortune magazine. It spoke of a plausible scenario that involved a total or partial shutdown of the ocean conveyor leading to horrifically hard winters, violent storms and droughts. As for the outcomes of these and other coalescing impacts, “as the planet’s carrying capacity shrinks, an ancient pattern re-emerges: the eruption of desperate, all-out wars over food, water, and energy supplies.”⁴

With this kind of attention to the greenhouse issue building up, the oil companies went into their 2004 AGMs in March facing a record number of shareholder resolutions on global warming. Most of these questioned how the companies would respond to emerging regulatory pressures on emissions, or sought disclosure of emissions data. ExxonMobil and ChevronTexaco were asked for a report on their efforts to invest in renewable energy. “The disparity of preparedness among the companies is disturbing,” said Ceres analyst Andrew Logan. “All oil companies essentially operate in the same global markets and are susceptible to the same emerging regulatory structures around the world - yet many of these companies seem relatively uninformed about the issue and how it could affect prices. It seems that US intransigence on global warming has translated into insularity that puts US companies at serious risk.”⁵

Shell, meanwhile, downgraded its reserves again, to further howls of anguish from investors. America’s mass-tort lawyers began to take an interest. “Shell holed below the waterline,” read a typical headline.

BP inevitably faced questions about its own reserves, but CEO Lord Browne brushed them aside. In March, he went to Washington, where Matthew Simmons had spoken out about his fears concerning Saudi oil supplies in February, to address the US National Press Club. “There is no physical shortage,” he said categorically. “The resources are there. The world holds some 1,000 billion barrels of oil which has been found but not yet produced, and some 5,500 trillion cubic feet of natural gas – also found but not yet produced. At current consumption rates that is forty years of oil supply and sixty years of gas. In addition the US Geological Survey estimates that some 800 billion barrels of oil and 4,500 trillion cubic feet of natural gas are yet to be found.”⁶

Shell parted company with Sir Phillip Watts. On 20 April it became clear why. The company made its third downgrade, this time admitting that it had misled investors. Devastating e-mails showed that Watts and Walter van de Vijver, Head of Exploration, had known about the problem for at least two years and possibly as long as seven. One dated 9 November 2003, from van de Vijver to Watts, read: “I am becoming sick and tired of lying about the extent of our reserves issues and the downward revisions that need to be done because of far too aggressive/optimistic bookings.” The two executives had insisted that the problem only came to light late in 2003. But one of the e-mails showed van de Vijver knew that SEC rules were being broken in February 2002. As recently as May 2002 Watts had told van de Vijver that he should “leave no stone unturned” in making the figures even higher.⁷

UK government’s chief scientific advisor attacks US over global warming.

Shells drops bombshell on reserves: 20% less then declared.

Wood Mackenzie report casts doubt on rate of success of oil discoveries.

Pentagon climate-catastrophe scenario leaked to Fortune magazine: even they see horror.

Petroleum Review survey shows not enough oil field megaprojects to match demand (500 mb plus).

2.04. UN weapons inspection chief says global warming is at least as worrying as WMD.

ExxonMobil says existing oil and gas fields are declining 4-6% per yr: huge new production needed by 2015.

BP questioned by shareholders on reserves.

Matthew Simmons speaks out in Washington: says Saudi peak is near. 24^th Saudis deny this.

94 new coal plants planned across 36 US states.

Oil companies face record shareholder resolutions on global warming at AGMs.

20.2.04. Jeff Skilling is finally charged over Enron’s collapse, and pleads not guilty. It has been nearly 17 months since Fastow was charged.

2.3.04. Scott Sullivan pleads guilty to criminal charges: conspiracy, fraud and making false statements about Worldcom’s financial health to regulators.

3.04. Swiss Re, world’s second biggest reinsurance company, warns global warming could spiral out of control.

Crisis deepens at Shell: reserves revised down further.

BP CEO Lord Browne gives relaxed speech in Washington, saying there is 40 years of oil supply.

US prosecutors ask Shell for explanations, raising prospect of criminal trial.

Investors to grill BP on oil reserves.

4.04. Spring 2004: Iraq goes pear-shaped

Meanwhile, the war in Iraq was entering its second year, with proliferating insurgency, increasingly beleaguered US and UK forces, and attacks on oil pipelines so commonplace that daily operation of Iraqi oil infrastructure, much less upgrading and expansion of production, was becoming extremely difficult. The Abu Ghraib torture scandal broke in May, further deepening the mire.⁸ BP and Shell reacted to this in differing ways. In the last week of April, Browne announced he would be pulling BP out, citing security and political pressures. This dealt a catastrophic blow to the Bush and Blair plans. Iraq had no chance without the giant companies, because it needed their expertise, technology and cash to get the domestic oil industry running.⁹ The following week, Shell announced it intended to establish a “material and enduring presence” in Iraq. It needed fresh reserves, a spokesman told the press.¹⁰

Unsurprisingly, the oil price started to creep up. In May 2004, it went through the $40-a-barrel mark for the first time. Continuing rises forced US consumers to spend an extra $44 billion at the pump during the first six months of 2004. By June, retailers were feeling the pinch in falling sales as shoppers stayed at home. As one retail executive saw it: “We are hurt by high oil prices because people are giving their extra dollars to Exxon.”¹¹

In late May, Shell made a fourth reserves downgrade, just before BP published its Statistical Review, with the conclusion that world reserves had gone up 10 percent during 2003. BP Chief Economist Peter Davies said: “There is no global oil resource or reserve shortage. Oil production continues to be replaced.”¹²

Elsewhere, optimism was even more extreme. One Dallas-based analyst told Voice of America that “the estimate is that we have about 14 trillion barrels of oil in shale oil and tar sands. Now, that is enough to fuel us for the next 500 years.”¹³ Another professed that we would never run out, citing Russian theories that oil could be created underground by inorganic means, that is from carbon in no way related to microscopic life in ancient seas, or indeed life of any sort.¹⁴

Global power plant additions reach unprecedented levels.

1.9 km Greenland ice sheet may melt completely this century, says Hadley Centre in Nature.

Ousted Shell head of exploration and production refuses to be made into the scapegoat.

Shell admits it misled investors.

BP ready to quit Iraq in blow to rebuilding hopes.

5.04. Association for Study of Peak Oil (ASPO) peak oil year revised down to 2007.

Abu Ghraib torture scandal emerges in Iraq.

Shell hopes Iraqi can plug its shortfall in reserves.

Kenneth Deffeyes, ex Shell Princeton professor, predicts oil peak during 2005.

Shell forced to make fourth downgrade.

“The Day After Tomorrow” premiers in London.

Terrorists are now targeting Saudi Arabia’s oil infrastructure.

Summer 2004: jitters everywhere, $100-a-barrel oil fears

An al-Qaida attack on Saudi oil infrastructure deepened jitters in June, adding a new factor to the list of reasons commonly cited for the persistently high price at the time: high demand, especially in China, shortage of spare capacity, lack of refinery capacity and – increasingly – speculation, with hedge funds betting on a long-term high price, so helping to create a potentially self-fulfilling prophecy.¹⁵ Though it did not cause major disruption, the attack pointed to a bigger possibility: a highly disruptive terrorist act at the main Saudi oil-export terminal at Ras Tanura. As a financial analyst, former Mobil engineer Fadel Gheit, put it: “If you can blow up the Pentagon in broad daylight, then it cannot be impossible to fly a plane into Ras Tanura - and then you are talking $100 [per barrel] oil.” Regime change would have the same effect, Gheit suggested. He views replacement of the Saudi royal family by a militant regime, as happened in Iran, as “only a matter of time”. ¹⁶ The price fell back from $40 in June 2004, but stayed in the high $30s. In Iraq, oil exports were brought to a halt after two strategically located attacks on pipelines. An oil-industry executive was assassinated the same day.¹⁷

In July 2004 I attended a gathering of oil analysts in the City of London to observe their culture of denial at work. The subject matter was the Shell reserves scandal and the details of how reserves should be reported, but they addressed the bigger question. “We’re not running out,” scoffed one, and went on to pinch Sheik Yamani’s line: “Ultimately, the Petroleum Age will come to an end. The Stone Age came to an end too. But not because we ran out of stones.”¹⁸

A Deutsche Bank analysts’ report published a month earlier had offered an insight into the intellectual gymnastics that are required to maintain course with this kind of denial. It opened with a statement of the obvious: “If it could be shown that geological constraints signify an imminent peak in oil and natural-gas production levels, the investment implications, in our view, would be enormous.” But it went on to conclude that there was no need for concern, and criticize the use of the Hubbert Curve on the grounds that technology, costs, prices or politics can move the descending part of the curve to the right. “In our view, this completely eliminates its value when trying to make most stock or sector allocation investment decisions,” the analysts concluded. Their report spun a spurious attack on the Hubbert Curve for oil depletion, which few early toppers think can be applied rigidly to countries other than the USA - as discussed in Chapter 3 – into an assumption that there is no need to look at its general implications for depletion.¹⁹

Meanwhile, scientists announced that atmospheric carbon-dioxide concentrations had risen by an alarming 3 parts per million – ahead of projections – for the second year running. Though too soon to be sure this was a trend that could indicate amplifying feedbacks running amok, it was enough to push speculation about the dreadful prospect of a runaway greenhouse effect back into the media.

The fate of life as we know it couldn’t hope to occupy the same column inches as the Shell scandal, which rolled on like a bizarre soap opera. In late June, investors vented their fury with the “incompetent” board at the company’s AGM, having learnt that non-executive directors knew of the downgrade weeks before it was announced.²⁰ In late July, Shell paid penalties totalling $150 million to the US Securities and Exchange Commission and the British Financial Services Authority. In the latter’s eyes, the world’s third biggest oil company stood accused of “unprecedented misconduct”. ²¹ A number of serving and former directors remained under criminal investigation by the US Justice Department.²²

The oil companies posted record mid-year profits, but the questions remained about their ability to keep up with demand. At best, in the case of ExxonMobil, production was relatively flat. But many companies produced less than they did in 2003; in Shell’s and ConocoPhillips’ cases 5 percent less.²³ Meanwhile, BP’s Lord Browne travelled to Russia to seek personal assurance from President Putin that his government’s legal assault on Russian oil giant Yukos – a thinly disguised renationalization – would not affect BP’s growing dependency on Russian oil.

In early August 2004, a Saudi expert told the Oil & Gas Journal that high oil prices are inevitable for the rest of the decade.²⁴ OPEC itself warned about supply problems. Secretary-General Purnomo Yusgiantoro announced that there was no longer any spare capacity: the taps could not be opened further. “The oil price is very high, it’s crazy,” he said. “There is no additional supply.” The oil price moved higher on the back of this indiscretion, nudging the $45 mark.²⁵ The following day Yusgiantoro tried to calm the market by saying that OPEC could in fact pump another 1 to 1.5 million barrels per day. It was not enough to stop headline writers shouting about a threat to the world economy.²⁶ The very next day the record was broken again, this time on news of another blow dealt by the Kremlin to beleaguered Yukos.²⁷ “The risks of a crash have increased, the oil price could be the tipping point,” observed a London-based analyst.²⁸ “It isn’t called ‘the devil’s excrement’ for nothing,” quipped a newspaper leader column.²⁹

The hits rolled on. Iraq was forced to shut production in its southern fields after the threat of sabotage.³⁰ Deutsche Bank warned for the first time that the oil price could reach $100. “It’s worth asking ourselves”, said their Global Energy Strategist Adam Sieminski, “what would happen if we lost four million barrels a day, due to some accident? Or let’s say Iraq’s two million barrels a day became unavailable. OPEC’s got no spare capacity. And that could be it: $100 per barrel.”³¹

6.04.

“Even OPEC cannot stem this surge”: Supply and demand issues are forcing up oil prices.

Attack on key Saudi oil terminal “could destabilise West.”

“Saudi Arabia has descended into a cauldron of hatreds and divisions:” Maj Yamani.

Brokers warn there isn’t the tanker capacity for high production levels.

Chemical industry says it is under severe pressure because of high oil price.

Reserves: “What we have now is meaningless data,” Matthew Simmons tells New York Times.

World oil reserves up 10%, says BP.

Voice of America airs one view: 550 years of oil supply.

“My fears for planet:” Shell Chairman Oxburgh’s admission about global warming shocks industry.

Pipelines blown up in Iraq.

Shell investors vent fury on “incompetent” board.

Shell knew of reserves problem weeks before downgrade.

Alberta’s oil industry warned for using too much water.

Hidden costs of Baku pipeline exposed.

7.04. OPEC trading in Euros? Was this the reason for war?

Campbell and Skrebowski warn a seminar of British Parliamentarians about peak oil.

Atmospheric CO2 rises 3 ppm for second year running: scientists worry about runaway warming.

IEA ED says sense of crisis about oil supplies is overdone.

CERES publishes guide warning investors about climate change and risk to investments.

OGJ reports deep water oil may already have peaked.

Lord Browne seeks assurance from Kremlin that Yukos affair will not harm its Russian oil & gas interests.

Shell pays total of $150m to settle investigations.

Mass seabird mortality in Scotland as food supply fails in warm water.

Houston Chronicle asks “Can oil majors keep up with worldwide demand?”

8.7.04. Ken Lay finally charged for his role in Enron’s collapse. He pleads not guilty.

8.04. Russia’s federal Energy Agency head says 2005 oil production will be flat, or drop.

Oil price crosses $40 and then $45. Some analysts warn of oil threat to world economy.

High prices here for a decade, Saudis tell OGJ.

OPEC Secretary General: “There is no additional supply.”

Headline: “Oil threat to world economy”

Oil prices at record high after Kremlin u-turn on Yukos.

London analyst: “The risks of a crash have increased; the oil price could be the tipping point.”

Corporate raider T Boone Pickens asks "will we pump more than 82m barrels?”

Oil price hits $45 as Iraq sabotage deepens crisis.

Yukos shares tumble as its oil production unit (Yuganskneftegaz) is seized.

UK oil imports exceed exports for the first time in 11 years of production.

Shell advertises for Iraq “chairman”.

Goldman Sachs warns that nowhere near enough is being invested in exploration and infrastructure.

Disgraced Shell head of exploration gets £2.5m payout.

Scientists discover seas are turning acid as they absorb carbon dioxide.

Ailing Shell braces for takeover bid from Total.

Hurricane Charley: “our worst fears have come true, says Governer Bush.

Deutsche Bank points out this is the 6^th year running that analysts have underestimated oil prices.

UK power bills to soar as wholesale prices double.

FSA fines Shell and accuses group of 'unprecedented misconduct' in oil and gas reserves scandal.

9.04. ASPO revises oil peak year to 2006.

Deutsche Bank warns price could hit $100.

Report from British Embassy in Washington to Whitehall warns the early peak may be real.

Hurricane Frances hits Florida just as it is recovering from Charley.

Total CEO calls on Saudis to let oil majors in to boost output.

Blair visits solarcentury, says global warming poses greatest threat, makes it a G-8 priority for 2005.

IMF says Global financial system is “shock proof”.

OPEC raises quotas to defect criticism.

As OPEC meets, Browne tries to reassure the markets.

Exxon chief Raymond attacks the idea of energy independence for the US.

Yukos fights for its life in the face of Government tax grab, but keeps pumping.

Oil depletion hits front page of Wall Street Journal.

10.04. US operates more than 700 bases around the world. Military oil consumption is not in national statistics.

Oil industry “deep throat” says Saudi production peak will be in the final quarter of 2004

Autumn 2004: all eyes on OPEC (again)

OPEC ministers gathered in Vienna in September to confer about the growing crisis, amid much confusing headline-making by oil-industry chiefs. Total CEO Thierry Desmarest took a break from his scoping of a Shell takeover to announce that OPEC should open their doors – closed in most cases since the 1970s - to the big companies to ensure that supply meets demand. “If you want to increase production capacity, it is key,” he said. “We create opportunities through exploration, but exploration takes a lot of time.”³²

What message does this give about expectations for new exploration finds in the non-OPEC world?

Browne responded the next day with a bullish alternative view. “There isn't really a supply crunch at the moment. We have the perception of the risk of a supply interruption, but that's all we've got.”³³ He told the Financial Times that people were pessimistic about supply meeting demand because of their reluctance to consider politically fraught regions like Russia, west Africa, and the Middle East. “When you look at it from the West, the domestic sources of production are definitely in decline. So close in, that could look universally applicable. But of course, it's not. I think oil is coming from places [people] don't understand.”³⁴

ExxonMobil’s Lee Raymond sided with Total. He told the OPEC ministers that growing international demand would be met only through access to oilfields currently off-limits to the international oil companies. “The future need for petroleum energy will be such that restrictions, in whatever form and wherever imposed, will jeopardize access to adequate energy supplies for world consumers.” What did this mean for the US and its oil policy? “I think that the notion in the United States of energy independence, which was first proposed in the Nixon administration, was a poor concept thirty years ago and it is a poor concept today.”³⁵ There it is, just as he told OPEC. It couldn’t be clearer. We choose dependency, and therefore overseas adventures by our military in support of our dependency.

OPEC announced its response to building events: a 1-million-barrel hike in production.³⁶

Surely, I thought in the summer of 2004, by now governments must be noticing the early depletion problem. I met many a senior official in the course of my work on the UK government’s Renewables Advisory Board, and rarely missed an opportunity to ask where they though the oil peak was. Not a problem, I was told by someone near the top of the Department of Trade and Industry. Don’t know anything about it, a Treasury official told me. Nothing in it for politicians, said someone in a high place in the Prime Minister’s office. Then, in September, an important letter began circulating in Whitehall. It was from the First Secretary for Energy and Environment in the Washington embassy. He had attended a seminar on oil supply given by the respected consultancy PFC. “The presentation drew some gasps from the assembled energy cogniscenti,” the diplomat reported back to London. “They predict a peaking of global supply in the face of high demand by as early as 2015. This will lead to a more regionalized oil market, a key role for West African producers, and continued high and volatile prices.”

In October, G7 finance ministers met in Washington for the annual meetings of the World Bank and the International Monetary Fund. A key part of the statement by the ministers and central bank governors read: “Oil prices remain high and are a risk. So first, we call on oil producers to provide adequate supplies to ensure that prices remain moderate. Second, it is important consumer nations increase energy efficiency. Third, it is important for consumers and producers that oil markets function efficiently and we encourage the International Energy Agency to enhance its work on oil data transparency.” As a veteran financial correspondent described it, “… my sense of [the] meetings is that there is an atmosphere of suppressed panic about the oil price, and about the danger of a serious crisis”.³⁷

The following week the oil price went over $50 per barrel for the first time.³⁸ Within days it had crossed $54 in New York and $51 in London.³⁹ By the end of the month it had crossed $55. Every small jolt to the market pushed it to new levels. The latest concerns involved tight heating-oil supplies ahead of winter, strong oil demand in China and fears about a planned petroleum-industry lockout in Norway.⁴⁰

In an extraordinary move that would hardly have the effect of calming fears about supply, at the end of October OPEC called on the US to open its 670-million-barrel Strategic Petroleum Reserve to help “cool” the prices. This reserve, kept in caverns in Louisiana salt mines, is supposed to be for major emergencies. No, said the US, there is plenty of oil in OPEC countries. Get pumping.⁴¹

Lord Browne once more took to the field to try and calm the jitters. “It is not helpful for the world to believe that it is running out of oil,” he said. “We are evidently not.” ⁴²

The next day, both BP and Exxon announced yet another set of record profits, and Shell warned that yet another reserves downgrade was in the offing. Shell CEO Jeroen van der Veer broke the usual industry solidarity at this point. “There is something strange going on in this industry,” he told the Economist. He voiced suspicions that his company was merely the first to face up to a problem that was actually industry-wide. “I would bet money that is the case,” one analyst responded.⁴³ But that didn’t help Shell much. The continuing uncertainty over reserves meant that the once seemingly invincible giant had to announce its AGM would be delayed.
3.10.04. BP on course for $16 billion profits this year. & see 26^th

7.10.04. Exxon admits greenhouse admissions increase.

10.10.04. G8 finance ministers’ in state of “suppressed panic” as they warn oil price jeopardises world growth. & 3^r

12.10.04. Oil price over $50 for first time.

19.10.04. Disgraced former Shell CEO Watts seeks early ruling in his legal battle with the FSA.

21.10.04. Russian Duma ratifies the Kyoto Protocol, meaning it can come into force February 2005.

25.10.04. Oil price hits £55.

26.10.04. IEA warns over risks to energy security from high oil price.

27.10.04. OPEC calls for US to open strategic reserves to help reduce oil price.

Lord Browne steps in to curb supply fears.

28.10.04. Exxon and BP announce record profits.

Shell warns again on reserves and unifies board.

11.04. More warnings that OPEC are in the process of ditching the dollar, with disastrous impacts for the US.

Saudis claim their reserves are fine.

George W. Bush re-elected

Energy Institute holds conference on oil depletion. Most attendees think there is a crisis.

Financial Times: “Halliburton scandal widens.”

Shell CEO van der Veer alludes to doubts about reserves at other firms’ reserves.

Cracks found in Baku pipeline.

Price set for final Yukos sale.

Iraqi pipeline attacks lifts oil above $50 again.

Continued uncertainty over reserves at Shell causes 2005 AGM to be delayed.

12.04. Further ASPO warning on Saudi reserves.

Former US Energy Secretary calls for Strategic Petroleum Reserve to be increased from current 700 mb.

OPEC ministers agree to cut production to arrest fall in oil prices.

….Oil price duly rises again.

FT: Secret and unreliable oil statistics mean “spies will be business for some time to come.”

van der Veer admits his “head is on the block.”

Yukos takes the extraordinary step of seeking protection from its own government in US courts.

US waters down global greenhouse commitments at annual climate summit.

Mystery bidder pays $9.35 billion for Yukos production.

al-Qaeda issues threat to Saudi oil.

Tsunami kills 240,000 around shores of Indian Ocean.

Putin’s Senior Economic Advisor calls sale of Yukos “scam of the year.”

2004 was the costliest year ever for insurers at $44 bn.

1.1.05. Record $30 billion in new investment in renewables in 2004: RE now 4% of world total. 1.7 million jobs. with at least 48 countries promoting RE via policy. Market leaders: Brazil in biofuels, China in solar hot water, Germany in solar electricity, and Spain in wind. PV is fastest growing, 60% from 2000-2004, covering >400,000 roofs in Japan, Germany and US. REN 21 report release, see Q4 2005.