Today's climate and energy headlines:
- Carbon 'bubble' could cost global economy trillions
- UK takes £5bn stake in Welsh nuclear power station in policy U-turn
- Chinese solar power stocks plunge as government moves to contain industry size
- Limiting global warming to 2 degrees now 'aspirational': scientists
- 2017 set a new record for renewable power, but emissions are still rising
- Central banks can lead in disclosure of climate risks
- Snow depth on Arctic sea ice from historical in situ data
A collapse in demand for fossil fuel, known as the bursting of the “carbon bubble”, could see the world’s economy heading for another downturn, BBC News reports. Research published in Nature Climate Change predicts that oil companies’ reserves will become “stranded assets” before 2035, having been devalued by a quick shift to green energy and electric cars. The researchers say that the resulting collapse in fossil fuel prices could wipe one trillion dollars off the global economy, if no new actions to limit warming to below 2C are taken – larger than the financial crash in 2008. They estimate that this could rise to $4 trillion “if new policies to restrict emissions further are set”. The Guardianhighlights that “crucially, the findings suggest that a rapid decline in fossil fuel demand is no longer dependent on stronger policies and actions from governments around the world”. Prof Jorge Viñuales, co-author of the study, told the BBC: “You don’t need to have anything for the stranding to happen, because what has already been done in the past is driving this phenomenon”. Dr Jean-François Mercure, the study’s lead author, told the Guardian: “This is happening already – we have observed the data and made projections from there. With more policies from governments, this would happen faster. But without strong [climate] policies, it is already happening. To some degree at least you can’t stop it. But if people stop putting funds now in fossil fuels, they may at least limit their losses.” While there has been a growing movement for divesting from shares in fossil fuel companies in recent years, the sector still accounts for 6% of global stock markets and 12% in the UK, the BBC explains. Elsewhere, other publications focused on a green energy angle, with the Times leading with: “Green energy predicted to wipe trillions from global economy”, and the Independent leading with: “Green technology to burst ‘carbon bubble’ in catastrophe for fossil-fuel economies, new research predicts”. The Times notes that: “British economy could benefit overall from the collapse because of its growing offshore wind and electric car industries”. The US and Canada would be the biggest losers. The study’s lead author, told the Times: “When people realise that perhaps their investments are not safe and they decide to put their money elsewhere this can lead to crowd effects and [share prices] could change value very rapidly…That’s why it is better to deflate the carbon bubble early in order to have an orderly transition.” The researchers found that the share of power generation from renewable sources was growing at a pace of 8% per year, while the share of hybrid and electric vehicle models was increasing by upwards of 10% per year. Eurekalert also has the story.
The UK is to invest upwards of £5bn in a new nuclear power station in Wales, in a “striking reversal” of a decades-long policy of avoiding direct investment in nuclear power. Greg Clark, the UK’s business secretary announced the initial agreement with the Japanese firm Hitachi in the House of Commons yesterday. The plant in Wylfa is expected to generate enough low carbon power for 6% of the UK’s energy, or around 5m homes. Ministers have previously ruled out taking a direct stake in new nuclear projects, “to avoid exposing public finances to the risk of budget overruns”, the Guardian explains. But the government stake has reduced the guaranteed price of power from the plant to around £75-£77 per megawatt hour. Caroline Lucas, the co-leader of the Green party, commented: “Taking a stake in this nuclear monstrosity would see taxpayers locked into the project and paying out for a form of electricity generation that’s not fit for the future.” The Times leads with: “Wylfa nuclear plant would be funded by taxpayers, admits minister”. The Financial Times also has the story.
The Chinese government has suspended the construction of new solar farms and cut subsidies in a “surprising” move announced last Friday to rein in the expansion of the solar industry, the South China Morning Post reports. Since then, shares in Sungrow Power, the country’s biggest maker of inverters for solar and wind power, tumbled by 10%, while GCL-Poly, the world’s largest producer of solar wafers used to make solar panels, slumped 9.2%. The measures are aimed at “promoting the solar energy sector’s sustainable development, enhancing its development quality and speeding up reduction of subsidies”, the Chinese government said in a statement. Energy Live News also has the story.
The world’s first full-scale “liquid air” plant will turn air into liquid for energy storage to help electricity grids cope with a growing amount of renewable power, the Guardian reports. The demonstration project in north-west England uses excess or off-peak electricity to chill air to -196C, transforming it to a liquid state to be stored inside large metal tanks. Pumping and heating is used later to turn it back to a gas, which is released to turn a turbine, generating electricity at times of need, but without releasing emissions. Advocates say this technology is cheaper than lithium-ion batteries, and able to provide power for longer periods. The Financial Times also carries the story.
A feature in Quartz uses two charts to explore why emissions are still rising, despite a record-breaking expansion of renewable-power capacity last year. Akshat Rathi explains: “World demand for energy increased by 2.1% last year, and low-carbon sources could not keep pace. As a result, the word’s energy-related carbon emissions rose by 1.7%, the first rise in four years.” He concludes: “It’s an important reminder that, despite all the talk about the growth of renewables, we still rely heavily on fossil fuels.”
Over 50 non-profits and other organisations, including the New Economics Foundation, Christian Aid and Greenpeace have written a letter to the Financial Times, calling on the central banks and financial regulators to “lead by example by disclosing the climate risks and financial implications of climate change on their own balance sheets”. “As central banks are public institutions, with losses on their balance sheets often indemnified by taxpayers, there is a particular onus on them to walk the talk”, they write. “Greater transparency and disclosure is thus not only imperative to ensure coherence with their public statements, but also a duty to society, which central banks are ultimately accountable to.”
The average snow depth across Arctic sea ice in Eurasia has fallen in comparison to observations from the 1970s, research shows. “The new climatology shows lower snow depth in the central Arctic comparing to Warren climatology and more detailed data in the Eurasian seas,” the researchers conclude.
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