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Briefing date 24.06.2022
Germany raises national energy alert over Russia’s ‘economic attack’

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Germany raises national energy alert over Russia’s ‘economic attack'
Politico Read Article

The German government formally placed its energy market on a “war footing” yesterday, reports Politico, over Russia’s sharp reduction of gas supplies, telling households to reduce consumption and warning that industrial output will be hit. It continues: “Announcing stage two of its three-stage alert system – one stop short of a full emergency where the government would take control of energy distribution and ration gas supply – Germany’s vice chancellor Robert Habeck said it was time to get serious about the consequences of supply cuts following Russia’s invasion of Ukraine.” Habeck is quoted saying: “We must not delude ourselves, cutting gas supplies is an economic attack on us by [Russian president Vladimir] Putin…It is clearly Putin’s strategy to create insecurity, drive up prices and divide us as a society.” Reuters also quotes Habeck, who announced: “Gas is from now on in short supply in Germany…Even if you don’t feel it yet: We are in a gas crisis”. Habeck called on all consumers – industry, households and public institutions – to reduce their consumption as much as possible “so that we can get through the winter”, notes the outlet. European power prices “surged to the highest level since December” on the news, says BloombergReuters carries reaction from government, companies and industry groups. Bloomberg also reports that Germany “is bracing for a further drop in supply next month when a key pipeline shuts for maintenance – and fears the link may never return to full capacity”. It adds: “The Nord Stream pipe, already operating at just 40% of normal levels, will be offline for works on 22-21 July, tightening a market that’s seen prices soar in recent weeks. That means less gas will be available to pump into storage, jeopardising German efforts to replenish essential stockpiles ahead of winter.” The head of Germany utility RWE has warned that “European solidarity will come under significant stress” unless they act now to establish rules on energy sharing, reports the Financial Times.

Meanwhile, the European Commission said yesterday that European Union countries have so far been able to compensate for reduced gas supply from Russia, but are increasing preparation in case of further supply cuts, reports Reuters. A spokesperson is quoted saying: “According to our exchange with the national authorities, the gas security of supply in Germany – and in the EU – is currently guaranteed. Lower inflows of gas from Russia can so far be compensated.” Politico says that the EU is racing “to free itself from Russia’s gas noose”. With 12 EU countries “noting complete or partial shutoffs of Russian gas”, the European Parliament yesterday backed a plan for member countries to fill their gas storage to 80% of capacity by 1 November, it reports. It says commission vice president Frans Timmermans told MEPs on Thursday: “The risk of a full gas disruption is now more real than ever before…That is why the adoption of the gas storage regulation … is so important at this moment.” Bloomberg reports that the EU has “reached an agreement with Norway to source more natural gas”, which will “bring close to 100 terrawatt hours of extra energy to the European market”. Reuters reports that Mauritania’s oil minister said yesterday that “recent prices have opened the opportunity for Mauritania, Senegal as well as other African countries to export more gas to Europe…Europe needs to diversify its supply resources, so that fantastic opportunity – we need not miss it.” Reuters has a “factbox” on the plans that European countries are putting in place to manage gas supply.

Elsewhere, German industry is accelerating efforts to find alternatives to keep factories running and limit the economic cost of gas supply disruption, reports Reuters. It says that chemical giant BASF is working out which factories could cut output first and rival Lanxess may delay shutting some coal-fired power plants, while Aurubis, Europe’s top copper smelter, said it is also looking for substitutes but that adapting power plants is expensive and time-consuming. In addition, Handelsblatt reports that the head of energy supplier Eon Leonhard Birnbaum is calling for fracking in Germany to produce gas: “We have to ask ourselves the question: Can we develop additional fields in Germany?” Birnbaum said in a podcast for Wirtschaftswoche. However, former federal environment minister Jürgen Trittin spoke out against the planned gas production off the North Sea island of Borkum saying that “60bn cubic metres that are there do not even cover a year’s requirements in Germany. That doesn’t play a major role in replacing Russian gas”, reports Die Zeit.

Finally, German news channel Ntv reports that parliamentary parties SPD and Greens reject extending the lifetime of the last nuclear power plants. It says that in a report for the state of Bavaria, expert organisation TÜV Süd came to the conclusion that the continued operation of the Isar 2 reactor would be possible until mid-2023 without new fuel elements.

UK oil and gas producers warn Sunak over windfall tax
Financial Times Read Article

UK oil and gas producers yesterday warned UK chancellor Rishi Sunak that his new windfall tax on their profits could force the cancellation of projects as well as prompt investors to deploy their capital elsewhere, reports the Financial Times. It continues: “At a meeting with Sunak in Aberdeen, about 20 executives from companies with UK North Sea operations – including Equinor, Harbour Energy, Ithaca Energy and Shell – highlighted negative consequences from the chancellor’s 25% ‘energy profits levy’. The windfall tax, unveiled by Sunak in May, is meant to partly fund a £15bn support package for UK households struggling with soaring energy bills.” The levy raises the headline tax rate paid by North Sea oil and gas producers to 65%, which Simon Roddy, senior vice-president for Shell’s UK upstream oil and gas business, described as a “negative signal” that was undermining investment in British waters, the paper says. Bloomberg says that Sunak “remained committed” to the tax, and adds that “attendees described the meeting as tense”. The Guardian, which says the meeting was “bruising”, notes that Sunak “told oil and gas executives he is trying to ensure investment in their businesses is not curtailed”.

Meanwhile, the Independent reports the comment of UK business secretary Kwasi Kwarteng at a conference hosted by the Chatham House thinktank, He said that new wind farms have “to be part of a local consent” because “we’re not in China – we can’t simply just impose top down where all this infrastructure goes”.

In related comment, Tom Sasse – associate director at the Institute for Government thinktank – writes for PoliticsHome on why the business department and the Treasury can’t “get on”. He writes that Kwasi Kwarteng and Rishi Sunak “butted heads over plans for a windfall tax”, noting that “even as the Treasury grew warmer, Kwarteng loudly continued to call it a ‘bad idea’”. And “back in March, they were locked in weeks of tortured wrangling over the British Energy Security Strategy. An exasperated Department for Business, Energy and Industry Strategy (BEIS) official called the Treasury’s refusal to provide extra money to insulate homes ‘ridiculous’”. Sasse notes that BEIS is leading on net-zero, but even before the current energy price spike, it was “becoming a source of tension”. He adds: “The UK published a market-based techno-optimist net-zero strategy ahead of COP26, but Sunak has been notably cool, courting a vocal group of net-zero sceptics.”

Britain, Germany push G7 for halt to biofuel mandates to tame food prices
Reuters Read Article

A Reuters “exclusive” reports that “officials from some G7 countries, including Germany and Britain, will push for temporary waivers on biofuels mandates to combat soaring food prices when leaders from the group of wealthy nations meet on Sunday”. A British government official told the newswire that “we’re quite keen to look at the issue of biofuel mandates to ensure that crops are prioritised for food consumption and not necessarily for use in fuels”. The outlet adds: “It’s not clear whether there’s broad-based support to temporarily waive biofuel mandates across the G7 members which include Canada, France, Germany, Italy, Japan, Britain and the world’s largest biofuel producer, the US.” The G7 will begin a three-day meeting in Bavaria, Germany, on Sunday and food security is “expected to be on the agenda, after the presidency launched a Global Alliance for Food Security in May to tackle hunger”, the newswire says. It notes that “it is not clear whether Germany or Britain are considering waivers on biofuels mandates in their domestic market”.

The Daily Telegraph is more certain, reporting that UK prime minister Boris Johnson “wants to reduce the amount of biofuel used in the UK, despite it being a key plank of his government’s net-zero ambitions”. It reports that Johnson will “call on G7 leaders to review their own biofuel use”. Specifically, it reports that Johnson will say: “While Vladimir Putin continues his futile and unprovoked war in Ukraine and cravenly blockades millions of tonnes of grain, the world’s poorest people are inching closer to starvation. From emergency food aid to reviewing our own biofuel use, the UK is playing its part to address this pernicious global crisis.” The Times notes that “cutting the use of crop-based biofuels would mean the requirement for the greener fuel to be the main offering at petrol stations would have to be temporarily dropped”.

In G7-related comment, directors of three different NGOs warn in a piece for Climate Home News that Germany and Japan “must not water down” a G7 commitment to end fossil fuel finance.

Commonwealth heads call for climate action at Rwanda meeting
Associated Press Read Article

Leaders of Commonwealth nations called for increased climate action at a meeting in Rwanda this week, reports the Associated Press. The newswire says that climate change is “a major concern for the 54-nation bloc that includes small island countries facing growing threats”. It reports that COP26 president Alok Sharma urged member countries to focus on implementing emission reduction targets set for 2030. Speaking at a business forum on the margins of the Commonwealth summit in Kigali, Sharma is quoted saying: “What it needs, friends, is for us to focus on implementation, and every country must respond to the Glasgow climate pact.“ The newswire says he added that Commonwealth governments must submit their emission reduction targets by 23 September, “including their long-term strategies”. The AP notes that “Commonwealth leaders are set to adopt the much-awaited ‘Living Lands Charter’ later this week, an action plan to address climate change, land degradation and biodiversity loss.” The Prince of Wales also addressed delegates, reports the Independent, urging leaders to take bold actions and lead the world in the “right direction” towards a sustainable future. It says he added: “To move forward at pace and scale we need to be clear on the enabling environment and the demand signals so that industry and investors know where to go, be it for renewable energy, sustainable infrastructure, sustainable aviation fuel or regenerative agriculture.”

Biden, 11 US states to boost support for offshore wind energy
Reuters Read Article

The US government has announced a partnership with 11 east coast states to accelerate the development of offshore wind, including addressing supply chain issues, advancing construction and boosting jobs, Reuters reports. In a statement released yesterday, the White House said the initiative will provide “funding to develop a comprehensive offshore wind supply chain roadmap” and “support the development of a domestic fleet of offshore wind installation and service vessels”, the newswire explains. The partnership initially includes Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania and Rhode Island, and “will look to expand to the West Coast and the Gulf of Mexico as offshore wind energy projects develop in those regions,” the statement is quoted saying. Missing from the agreement is Virginia, notes the Associated Press, “where Republican governor Glenn Youngkin has moved to withdraw the state from a regional carbon-limiting initiative meant to combat climate change”. It adds that “a spokesperson for Youngkin had no immediate comment on the new offshore wind group”.

Elsewhere, Reuters also reports while President Biden, “rarely mentions electric car maker Tesla in public”, privately his administration “has leaned on the company to help craft a new policy to allow electric vehicles (EVs) to benefit from the nation’s lucrative renewable fuel subsidies”.

BRICS to expand green energy, digital cooperation in bid to boost sustainable development
Global Times Read Article

The BRICS business community “pledged to expand cooperation” in green energy and the digital economy, as a “broad effort” to tackle climate change and other global issues and “foster sustainable growth”, reports the Global Times, citing a document released at the BRICS Business Forum 2022 on Wednesday. The BRICS-founded New Development Bank said it will provide “$30bn of financial support” to member countries from 2022 to 2026, with “40% of the funds to be used to mitigate global warming”, the state-run newspaper notes, citing a report by the state news agency Xinhua. Meanwhile, Bloomberg, citing Xinhua, reports that President Xi Jinping “pledged to meet economic targets for the year even as the government’s zero tolerance approach to combating Covid outbreaks and a weak housing market put the growth goal further out of reach”. (The Independent reports that China’s CO2 emissions are “lowest since Covid lockdown amid economic downturn”, citing data firm Karryos, in analysis that mirrors findings published by Carbon Brief last month.)

Meanwhile, the State Council – China’s state administrative agency – released an opinion on Thursday which mentions accelerating the construction of an “intelligent monitoring and dynamic accounting system for carbon emissions…to ensure the smooth achievement of carbon peaking and carbon neutrality targets”, reports the state-run industry newspaper China Energy News. Additionally, according to the Ministry of Industry and Information Technology (MIIT), Chinese authorities have “introduced a raft of measures to boost energy conservation and reduce carbon emissions, to expedite the progress of green upgrading in industrial production”, reports Xinhua. A separate article by the news agency writes that China’s “top political advisor” Wang Yang has called for “making breakthroughs in core technologies in reducing pollution and carbon emissions and promoting innovations in policy, management, business model, as well as institution and mechanism” at a meeting of the country’s top political consultative body on Wednesday.

Reporting continues on the floods in south China, with the South China Morning Post saying that Chinese premier Li Keqiang has “called for authorities nationwide to step up flood control and disaster relief efforts as severe flooding in the southern part of the country affects hundreds of thousands of people” at an executive meeting of the State Council on Wednesday.

Elsewhere, Global Times carries another report titled “Chinese companies strive to help alleviate Pakistan’s power shortages”, describes the 720 megawatt (MW) Karot hydropower project on the Jhelum River in Pakistan’s eastern Punjab province, being built by China Three Gorges Corporation, a Chinese state-owned power company. Finally, Bloomberg writes that China’s second largest listed pork producer is looking to an “expansion into clean energy”, which the company says could “allow it to piggyback on billions of dollars in investment by a major power generator”.

UN rights body expert says he will fight for climate refugees
Reuters Read Article

A newly appointed UN expert on climate change and human rights said he will fight for legal protection for people driven across international borders by extreme weather, drought and rising sea levels, reports Reuters. Ian Fry, a former negotiator for the Pacific nation of Tuvalu, started last month as the UN Special Rapporteur on human rights and climate change, the newswire explains. Presenting his priorities to the UN Human Rights Council in Geneva – which created the new mandate – it says Fry said that climate refugees would be one of six priorities for his new mandate over the next three years. Speaking to Reuters on the sidelines of the session, Fry added: “Hopefully we can highlight gaps in the legal protection for people and try to initiate some sort of action to get some legal approach to protecting people in that situation whether through international law or regional agreements.”

Carbon capture: UK's largest project will turn CO2 into baking soda
New Scientist Read Article

The UK’s biggest carbon capture project is opening today, reports New Scientist, which says the captured CO2 being will be “used to make sodium bicarbonate for dialysis machines, pharmaceutical tablets and baking soda”. The outlet continues: “The new Tata Chemicals Europe (TCE) plant at Northwich in north-west England is currently on track to capture about 36,000 tonnes of CO2 a year. Eventually, this will rise to 40,000 tonnes, about 11% of the facility’s emissions, and more than 100 times the amount captured in power station pilots by energy firm Drax…The CO2 is captured from a gas-fired power plant at the facility and isn’t stored, but purified and turned into liquefied CO2 to make sodium bicarbonate.” Prof Stuart Haszeldine – professor of carbon capture and storage at the University of Edinburgh – “welcome[d] the project”, the outlet says, and noted that it is similar to a coal plant in India that is using CO2 to make sodium bicarbonate. However, he added that there is no permanent storage of the CO2 at the Northwich site and so it is eventually released to the atmosphere, telling the magazine: “This is an emissions decrease, not a permanent and durable removal of the fossil carbon released from burning the methane gas.“ The Times also has the story.

UK: EDF and Lord Deben fall out over Sizewell C nuclear plant in Suffolk
The Times Read Article

Lord Deben, who chairs the UK Climate Change Committee, has “raised doubts over EDF’s competence to build nuclear plants and called the decision to locate a proposed plant at Sizewell C in Suffolk ridiculous”, reports the Times. Speaking at a conference yesterday, Deben – who lives in Suffolk – is quoted saying: “The nuclear industry has a problem because it doesn’t deliver things on time and it doesn’t deliver them to budget. EDF has still got two nuclear power stations which aren’t finished and the reasons they’re not finished are nothing to do with nuclear. So there’s a real concern with people about how qualified these people are to do these things.” Deben also said that Suffolk was the wrong place for a new nuclear plant because “if you believe in levelling up, it’s ridiculous to put it in a place of high employment”, the paper reports. It adds that he warned that the area was already facing the construction of big new cables for fresh offshore wind farms and it was “not surprising the public is bloody cross”. The paper carries a response from EDF’s Julia Pyke saying “I think the word ‘nimby’ is probably one I could use fairly”.


Russia’s gas squeeze: a moment of truth for Europe
Editorial, Financial Times Read Article

As Russia tightens “its natural gas squeeze on Europe”, countries including Germany, Austria and the Netherlands “are restarting mothballed coal-fired power stations or raising limits on their output”, says a Financial Times editorial. While “reverting to coal is in part inevitable”, the paper says, it “threatens to slow the transition to green energy” and so “coal’s return should be shortlived; an impetus not to delay the switch to clean energy, but to accelerate it”. The paper says the International Energy Agency (IEA) is “right to say the overall answer to today’s energy squeeze and to the climate crisis is the same” – that is, “a ‘massive surge’ in investment to accelerate the transition to clean energy”. Things are “moving the right way”, the FT says, but the renewables industry has warned that “projects are being held up not by a shortage of funds but by cumbersome regulatory and planning processes in many countries, and problems connecting to grids”. The paper argues that “bureaucracy needs streamlining, and investment accelerated in modernising power grids and developing storage so they can cope with higher levels of intermittent renewables”.

Meanwhile, the FT’s Energy Source column looks at “why it’s getting harder to kick our fossil fuel addiction”. It says that the “short-term urgency to secure energy supplies is feeding into more fossil fuel demand now”, adding: “Pretending that even a temporary revival of coal-fired generation or new petrol price subsidy will help ease the fossil fuel dependence is like a junkie thinking one last week-long binge will break his addiction.” The article warns that “the odour of rich-country hypocrisy is what might be most damaging, making global climate co-operation harder”. It continues: “How can western leaders call for an end to fossil fuel subsidies, for example, or seek to halt financing for hydrocarbons projects in poor countries, while the Biden administration and European Commission sign deals for more American [liquefied natural gas], western governments slash fuel taxes and G7 leaders plead for more crude from Opec? Should poor countries without adequate electricity avoid coal while Germany, the world’s fourth-largest economy, starts burning lignite again? It’s a question that might hang over the debates at this year’s UN climate conference in Sharm el-Sheikh. Putin will be delighted.”

There’s a simple way to unite everyone behind climate justice – and it’s within our power
George Monbiot, The Guardian Read Article

In his column for the Guardian, George Monbiot lends his support for the “brilliant idea” of simultaneously cancelling both the historical financial debts of poorer nations and the “massive climate debt” that rich nations owe them in return. He explains: “Developed by campaigners in some of the world’s most exploited countries, it’s a brilliant idea: simple but systemic. Rich nations owe a massive climate debt to poorer nations: for the devastating impacts of the fossil fuels we have burned. Yet they have no intention of paying for the loss and damage they have caused. Poor countries are deemed to owe massive financial debts to the rich nations, yet they cannot pay them without destroying their economies and their ecosystems. The proposal is simultaneously to cancel both the climate and the financial debts, liberating the money poorer nations need to take climate action.” The “Debt for Climate” campaign – which is “mobilising labour, social and climate movements in 28 countries” – will be launched during the G7 summit in Germany, which starts on Sunday, Monbiot says.


Time to act
Science Read Article

The journal Science published a new collection of articles on climate change, including mitigation and adaptation measures. The accompanying editorial calls for the need to scale up production of energy-relevant materials such as lithium and cobalt “substantially…without reproducing the environmental harms and social inequities of the fossil fuel status quo”. The collection includes reviews on how “current global efforts are insufficient to limit warming to 1.5C”, “harnessing the potential of nature-based solutions for mitigating and adapting to climate change”, “climate change and the urgency to transform food systems” and “getting ahead of climate change for ecological adaptation and resilience”. A policy forum piece included in the collection calls for “substantial international investment” towards “enhancing adaptation policy, implementation and finance”.

High Mountain Asia hydropower systems threatened by climate-driven landscape instability
Nature Geoscience Read Article

According to a new perspective paper, climate change is “severely altering” meltwater from glaciers in the Himalayas and other high mountain regions of Asia, with implications for hydropower in the region. Researchers combine several data streams, including satellite imagery, measures of glacier thickness, weather data and records of flooding and sediment discharge in rivers in the Himalaya region. They determine that a “complex set of interacting processes” such as permafrost thaw and glacier retreat are leaving dams and hydropower projects vulnerable to sediment buildup and failure – “adversely affecting downstream food and energy systems that are relied on by billions of people”. The authors call for “forward-looking design and maintenance measures” to build resilience in these systems.

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