Triple Crunch Log Jeremy Leggett

26.1.07. Georgia jails Russian for trying to sell weapons-grade uranium for $1m. He had enough to build a bomb, and was trapped by agents posing as radical islamists. This took place in Dec 2005.

29.1.07. UN Chief seeks climate summit to break deadlock in negotiations. Ban Ki-moon, United Nations secretary-general, is trying.

30.1.07. Millions of UK water consumers face compulsory meters. So a DEFRA paper outlines, as a measure potentially to be imposed on water companies. See JL blog 23, on sustainable farming, 29.1.07.

30.1.07. Jeremy Paxman accuses his employer the BBC of carbon hypocrisy: too much flying around filming nature. He calls for 3% cuts per year for 10 years.

Systematic attempts by Bush administration to doctor scientists’ evidence on climate exposed. A report based on survey of 1,600 government scientists shows that fully 46% have been warned against using terms like global warming in their reports. Phil Cooney, a big player in this in the White House, now works for ExxonMobil.

An SRI fund comes top of all funds in the UK All Companies Sector for the first time. The Co-operative Insurance Sustainable Leaders Trust came first in the year to 31.1.07, with a 29.3% return, more than double the 13.2% sector average. 1% of all funds under management now are SRI funds. “Broad SRI” funds now are more than €1 trillion. Core SRI funds, which screen companies out, are >€100 billion.

UK emissions for 2005 show falling household emissions cancelled out by rising aircraft emissions. 2005 emissions fell 1% on 2004. Households are down 4.6%, aircraft up 7%.

UK Treasury introduces doubled air passenger duty; airlines say they are considering legal action. Virgin is among them. Campaigners say the tax is too low to affect behaviour.

New EU biofuels targets will mean EU will have to import from Brazil or Malaysia. The rule says all filling stations must offer E5 and E10 by 2009.

1.2.07. “We’ve kind of let the industry rust away,” says Matt Simmons on The Bloomberg Report. The current fleet of 600 offshore drilling rigs is an average of 25 years old, the age when normally rigs used to be retired: 80% are in the 24-27 year age group.⁵⁸

UK solar grants for the month run out 12 hours after becoming available. Phase One of the Low Carbon Buildings Programme is descending into farce.

American Enterprise Institute offers $10,000 cash to scientists who will critique the IPCC report. Lee Raymond is on their board. Rex Tillerson, CEO, at WEF: “It is clear that something is going on. It is not useful to debate any longer.” But they still do not advocate emissions reductions, only a set of bland principles for developing policy.

UK Department of Education plans to place global warming at heart of school curriculum. Textbooks are way out of date.

WalMart CEO says sustainability is mainstream and puts pressure on its 60,000 suppliers to cut carbon (of its 7,000 stores in 14 countries). Lee Scott vehemently denies his zero carbon campaign is greenwash. Note: Just 30 retailers have captured around one-third of the global food market, and their control is increasing, says Andrew Sims. “One prediction suggests that by 2010 there will only be 10 major global food retailers.”

3.2.07. Fourth IPCC Scientific Assessment Report creates worldwide headlines with theme “Worse than we thought” (as on Guardian front page). Global average temperature rise “most likely” 4C estimated by end of century, possibly up to 6.4 including feedback effects. This is higher than the last report (5.8C at upper range), reflecting stronger feedbacks. The Panel says a significant switch to clean and efficient technologies could cut expected temperature rise by half. 300 delegates representing 600 scientists from 113 countries attend the final drafting meeting. 2,500 scientists in all collaborated. Six years ago the conclusion that warming was man-made was “likely”. Now it is deemed “very likely” and would have been “virtually certain” but for China and a few others.⁵⁹ (L) See JL blog 24, 3.2.07.

M&S becomes first retailer to buy a zero-emission battery truck. 7.5 tonne, 120 mile range, 50 mph top speed, £60,000k but economic Newton truck by Smith Electric. Starbucks also has one on trial.

Shell hires three Bush administration officials to help open up oil shales and Arctic oil. One is Gale Norton, a former interior secretary, who will concentrate on unconventional oil. See JL blog 25, on skiing and climate change, 5.2.07.

BNP has set up a front organisation to raise money in the US. Target is far right, theme is help us save Britain from Muslims. Front organisation: Civil Liberty.

US intelligence services admit for the first time that there is civil war in Iraq. 16 services wrote the report presented to the White House.

First serving conscientious objector goes on trial in US. He could face 4 years in jail.

4.2.07. BP significantly scales back its growth expectations after a year of struggling to complete new projects on time. It now hopes to produce 4m barrels a day of oil by 2009 and 4.3m b/d by 2012 – approximately a 12.5 per cent decrease in previous growth expectations. Capital expenditure target $18bn from $16.9bn last year. Browne is taking the rap for all this. Tony Hayward says his strategy is to “focus like a laser on safe and reliable operations.” See also 7.2.

5.2.07. China added 102 GW of new electric capacity last year, new figures show. This is twice California’s capacity. “It must be pointed out that climate change has been caused by the long-term historic emissions of developed countries and their high per-capita emissions,” said a Foreign Ministry spokesperson. “Developed countries bear an unshirkable responsibility.”

China may be a net importer of coal by end 2007. Supply can’t keep up with an economy growing at 10% p.a., and with the government closing down small mines for safety and environmental reasons. Official data: Chinese raw coal output climbed 11.9 percent to 2.07 billion tonnes in 2006. Chinese total coal-fired power generating capacity jumped 23.7 percent to 484 gigawatts.

China’s biggest coal company, Shenhua, launches a huge coal-to-liquids programme. Working with Shell and Sasol, it plans 8 liquefaction plants by 2020, 30 mt a year of CTL, displacing 10% of projected Chinese imports.⁶⁰

“Smart pig” sensing device breaks apart in Trans-Alaska pipeline while sensing for corrosion. This they are designed to do if they encounter obstructions. Next smart pig run is scheduled for late Feb or early March.

Russia is in danger of falling behind with gas exports to western Europe, IEA says. Deputy ED William Ramsay blames efforts to increase control over domestic operations. “The IEA believes that a supply gap has already started from Russia and that if it doesn't invest more, it is going to fall behind in deliveries to Europe,” Ramsay said.

Iran is in danger of using so much gas to boost oil production that it won’t have enough to export, says Economist Intelligence Unit. Much of the South Pars production is going to enhanced recovery because of rapid oil depletion.

7.2.07. Bishop of London promises not to fly for a year. Upping the ante and leading from the front. See JL blog 26, on taking the train, 8.2.07.

Barclays predicts that greentech-response to climate will heat up the global economy. “If ever the time were ripe for such an energy revolution, it is now,” said Tim Bond, global head of asset allocation at Barclays Capital, and author of the report. “And like all historical adoptions of general purpose technologies, the process should prove immensely stimulative to economic growth.”

8.2.07. £10m prize for the first person who invents a machine for removing CO2 from the atmosphere. Richard Branson says he will pay this prize, with Hansen, Lovelock and Flannery to be the judges. Meanwhile, he presses ahead with plans for a space tourism industry.

9.2.07. Survey finds 10% have reduced air travel because of climate change. So a British Air Transport Association survey shows. 776 people have signed up on a new website promising not to fly for a year. But with 228 million people passing through Britain's airports and an estimated 465 million expected by 2030, we have some way to go.

11.2.07. Production from BP’s giant Thunder Horse field delayed until end of 2008. Start up was originally scheduled for 2005. The field is now expected to produce 250,000 bpd. There are two hurricane seasons to go.

12.2.07. US investor group unveils blacklist of companies not to invest in because of climate performance. Ceres, a group of state pension funds with $200 bn under management, plus environmental and religious groups, names ExxonMobil and ConocoPhillips in oil, TXU and Dominion Resources in electric power, Massey Energy and Consol Energy in coal, and ACE in insurance.

Putin visits Qatar amid NATO fears that Russia is trying to form a “gas OPEC.” Europe relies on Russia for a quarter of its gas. He also visits Saudi Arabia and Jordan: the first time a Russian leader has visited these countries.

North Sea oil and gas production declining 10% faster than forecast last year, oil industry says. This is the prediction of UKOOA for the next few years. They also forecast rising costs and falling investment. There is still 16-25 bboe left to be extracted, but new wells generally tap very small accumulations. Recent finds have been in the 10mb range.

Ministry of Defence budget cutting threatens climate research capabilities in the UK. The MOD controls the budget of the Met Office. This emerges even as PM Blair talks up the need for a post Kyoto agreement after meeting Merkel.

13.2.07. Blair stakes his legacy on achieving a post-Kyoto climate deal. Asked after a meeting with Merkel in Berlin what was the focus of his remaining months, Blair said this was it: a climate deal including India and China. “This is a very, very crucial moment,” the FT quotes him as saying, and that climate change was a more important issue than the crisis in the Middle East or the stalled world trade talks.

Shell CEO offers a vision of growing oil use and a coal comeback. In a section of his speech at International Petroleum Week labelled “facts and vision,” he says, “the most important fact is that energy demand is rising and will continue to rise. Another fact is that fossil fuels are and will remain the dominant source of energy for decades to come.” Maybe we can cut to 77% fossil by 2030 if we try hard. Renewables can contribute perhaps 25% by 2050. He comes close to lampooning solar. Shell’s target is 5% reduction in GHG emissions from installations by 2010.

14.2.07. High Court rules that UK government’s energy white paper endorsement of nuclear is unlawful. Mr Justice Sullivan agrees with Greenpeace, who brought the case, that the energy review was not the “fullest public consultation” the government committed itself to in the 2003 energy white paper before making a decision to back new nuclear power stations. Mr Justice Sullivan says that the consultation exercise was “seriously flawed and that the process was manifestly inadequate and unfair” because insufficient information had been made available by the Government for consultees to make an “intelligent response.”

ExxonMobil’s change of course on climate is complete: CEO Tillerson says we have to act. At a CERA conference in Houston – “We know our climate is changing, the average temperature of the earth is rising and greenhouse gas emissions are increasing. The risks to society and ecosystems from climate change could prove to be significant. So, despite the uncertainties, it is prudent to develop and implement sensible strategies that address these risks while not reducing our ability to progress other global priorities, such as economic development, poverty eradication and public health.'”

Scientists detect huge quantities of water fast-moving below the West Antarctic ice sheet. Subglacial lakes have been known about, but never on the scale found with the Icesat satellite’s laser altimeter, in results just released. “The way we model the ice sheets to predict how they will behave in the future, how they will contribute to sea level rise in the future, doesn't take into account all of this,” says Prof David Vaughan of the BAS. Over a period of three years from 2003 to 2006 the scientists found regions where the elevation had changed dramatically. “The first lake we found had deflated by nine metres, which we were just amazed to see,” says one of the team, Helen Fricker of Scipps. The reason is the rapid movement of sub-glacial water. “Water is not moving around in a steady trickle but filling up in one place and bursting through to another and this process is more widespread than we thought,” Vaughan explains. Scientists had previously assumed the 3 km thick sheet was frozen to its base. Obviously now all bets are off about the scope for more rapid-then-anticipated collapse of the sheet, and global sea-level rise.

Luminaries from “G8 plus 5” countries reach informal agreement on climate, including caps on emissions, at a meeting in Washington. GLOBE set the meeting up with influential representatives of the G8, including Angela Merkel, and Brazil, China, India, Mexico and South Africa. “I want to make a prediction,” says Senator Joe Lieberman, capturing the mood, “which is that the Congress of the United States will enact a nationwide law mandating substantial reductions in greenhouse gases before the end of this Congress or early in the next.”

Several prominent Republicans drop opposition to action on climate. With nine climate bills before Congress, the Democratic party plans to pass a statute on global warming by July 4. John McCain, the Republican frontrunner, has sponsored a bill establishing a market-driven system of greenhouse gas tradeable allowances. Both Hilary Clinton and Barack Obama, the leading Democratic contenders, have co-sponsored McCain’s bill. Those shifting ground must be influenced by the popularity of Governor Arnold Schwarzenegger’s initiative to cut California’s emissions by 80% by 2050. This session of Congress ends late in 2008.

16.2.07. US philanthropists gave away $50.5bn in 2006, up from $4.3 bn in 2005. $43.5 bn was the Buffett donation to the Gates Foundation. The median was up from 32.5m to 60m.

17.2.07. Wood McKenzie report says all the world’s extra oil is likely to have to come from unconventional oil at great environmental cost. 3,600 bn barrels are available in principle, but only 8% has begun to be accessed so far. Only 15% is heavy and extra-heavy oil. Great amounts of energy are needed for extraction.

18.2.07. Climate scientists warn we only have a 50% chance of saving the Greenland ice cap. Its melting would raise sea levels by four to six metres. The forthcoming IPCC impacts report mentions this, in draft. “Very large sea level rises that would result from widespread deglaciation of Greenland and West Antarctic ice sheets imply major changes in coastlines and inundation of low-lying areas, with greatest effects in river deltas.” “Relocating populations, economic activity and infrastructure would be costly and challenging. There is medium confidence that both ice sheets would be committed to partial deglaciation for a global average temperature increase greater than 1-2C, causing sea level rise of 4-6m over centuries to millennia.” Medium confidence means about a five in 10 chance.

19.2.07. Australia announces bans old incandescent light bulbs, aiming to phase out by 2010, paving way for low energy fluorescent bulbs. “If the whole world switches to these bulbs today, we would reduce our consumption of electricity by an amount equal to five times Australia's annual consumption of electricity,” environment minister Malcolm Turnbull says. The phase out target is 2010.

Blow to gas-to-liquids technology as ExxonMobil cancels a major project in Qatar. The project was Exxon’s only planned venture, despite $600m of investments over two decades. Rising costs may be to blame, but note also that there are fears on supply from Qatar.

Abu Dhabi to build 500 MW $350 m solar plant. The first of its kind in the Gulf, onstream by 2009, to plant is to be be built by the Abu Dhabi Future Energy Co.

21.2.07. Half Europe’s transport subsidies still go to road transport: €140 bn pa. An EEA report shows emissions from road transport rose a quarter between 1990 and 2004 while emissions in most other sectors dropped.

Soaring price of grain threatens biofuels companies. Agricultural commodity prices have reached new highs following forecasts of a long hot summer in the US, which could bring grain yields down. Corn prices, at their highest ever levels, have doubled over the past year while the oil price has stayed the same. Analysts are saying this is beginning to challenge the economics of biofuels: still dependent on government subsidies in most countries.

Exxon says BP execs should not face legal grilling over the Texas City fire. Among the reasons given, it may deter companies from investing in Texas. BP has put in a plea to Texas’ supreme court for Browne not to face a deposition. Meanwhile, a BP employee has admitted deleting files from her laptop after being anonymously warned she would subpoenaed about the refinery fire.

22.2.07. Kashagan delayed for three more years as costs almost double: first oil is now 2010, Eni announces. This field, discovered in 2000 - the biggest discovery in 30 years - is becoming a talisman for delay and cost over-run in the industry.⁶¹

23.2.07. Sales of fair trade goods double as retail companies go to war on ethical positioning. It seems to be working for M&S, which has majored on socially-conscious positioning over the last year. Consumers spent £5m on fair-trade goods last year, new figures show. Equally, Primark, a cheap goods retailer, is being targeted for picketing in March by the student organisation People and Planet for failing to show sufficient commitment to sourcing ethically and paying producers and garment workers fairly.

See JL blog 27, 23.2.07, on emissions and the logistics industry.

24.2.07. UK CCS advocate says we could be selling technology to the world by 2012. But Defra and the Treasury are dragging their feet. Defra is to advise on a funding for a demonstration “later this year.” BP seems resigned to waiting another year for government funding for Peterhead project. Stuart Hazeldine at Edinburgh University, plus the UK Energy Research Centre, estimate the size of the UK market could be up to 150 million tonnes of CO2 a year: over 30% of our 2010 CO2 target of c. 470 mt CO2. 150 mt would be worth about £2bn (if the price of carbon is set at €17 a tonne, the forward price for 2012). Based on similar assumptions, the world market could be about £150bn.

Wind projects equal to 8% of UK electricity demand are stuck in planning limbo. 11 GW, more than the output of Drax. Some projects have been stuck for 4-6 years.

26.2.07. Five US generals and admirals will resign if Bush attacks Iran, the Sunday Times learns. This would be unprecedented. The Defense Secretary has repeatedly warned against an attack.

Coal knocked back on emissions in $45bn private equity takeover of Texan energy firm TXU. One of the world’s largest such deals involves reducing the number of planned new coal power stations from 11 to 3, $400m of efficiency investments, and places on the board for environmental campaigners. A clear indication that Wall Street and private equity financiers are starting to take green issues more seriously and that carbon intensity equals risk. The investors, Kohlberg Kravis Roberts and an investment group which includes US investment banks Goldman Sachs, Citigroup and Morgan Stanley, have also promised to promote solar power by offering rebates on photovoltaic equipment.

London’s Climate Change Action Plan to cut city’s CO2 emissions by 60% within 20 years. 44mt today to 18 mt by 2025: 4% pa. The budget will be £47m in its first year. Mayor Ken Livingstone has set a target of having 25% of the capital’s power provided by CHP by 2025. But figures do not include aviation, which he has not power to constrain. Projected aviation expansion would mean an overall cut of 20% if all the other targets were hit. Energy efficiency advisory service for Londoners will be funded by EST. Ken: “if every lightbulb in every London home was energy-efficient, London could save 575,000 tonnes of CO2 and £139m per year.”

Mild winter prompts China and India to say they have a role to play in tackling climate change. Official comments suggest they and are beginning to put strategies in place for participation in the post Kyoto negotiations. Both countries now recognise that their massive recent economic growth has been at the cost of energy efficiencies. However, they continue to point to the refusal of US and Australia to sign up to the Kyoto protocol.

Al Gore wins 2 Oscars for his film An Inconvenient Truth. He is the star of the show at the Oscars ceremony, prompting rumours he will run for the presidency.

36 leading UK property companies set up a Green Building Council. It includes companies such as Lend Lease, Sir Robert McAlpine and Barratt Homes, and aims to look at how the £90bn industry can improve in this area and become sustainable within the next 10 years. They have a combined turnover of £30 bn. Buildings currently account for 50% of the UK’s greenhouse gas emissions, but only 10% of GDP. Peter Rogers of Stanhope, Chairman, calls for a “radical transformation” in the way the industry works.

Governors of five states agree to work together to set a regional emissions-reduction target over next 18 months: California, NM, Wa, Or and Ar, accounting for 11% of US emissions. Arnold Schwarzenegger says if the federal government will not lead, the states will. Of the 5, California has the toughest targets at present: a cut of 25% by 2020. They aim for a cap-and-trade programme across a range of sectors. Seven NE states already target emissions in the utility sector.

Iraq Parliament approves legislation handing control of oil fields over to foreign firms as production slips below 2 mbd, less than before the invasion (2.5mbd). A new law, yet to be approved by cabinet, would sign away domestic control. Under the draft oil law, regional administrations will be empowered to negotiate contracts with international oil companies. The contracts will be reviewed by a central government committee in Baghdad, headed by the prime minister. Revenues will be distributed to all 18 provinces based on population size - a concession to the Sunnis whose central and western homeland has relatively few proven oil reserves. Most of Iraq's proven reserves, supposedly of 112bn barrels (2^nd or 3^rd biggest: reports vary) are in the Kurdish north and Shiite south.