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Daily Briefing

30.04.2020
Today's climate and energy headlines
DAILY BRIEFING ‘Historic’: Carbon emissions set to plunge a record 8% in 2020, says IEA
‘Historic’: Carbon emissions set to plunge a record 8% in 2020, says IEA

News.

'Historic': Carbon emissions set to plunge a record 8% in 2020, says IEA

There is extensive coverage of the International Energy Agency’s (IEA) global energy review for 2020, which projects a “historic” 8% fall in CO2 emissions due to the Covid-19 crisis. BusinessGreen says the IEA projections “suggest emissions are set to drop to their lowest level in 10 years, delivering a fall in annual emissions that is six times larger than the previous record set in the wake of the global financial crisis”. AFP notes that the IEA’s estimate is “based on an analysis of electricity demand over more than 100 days” and “predict[s] that global energy demand would fall 6% in 2020 – seven times more than during the 2008 financial crisis and the biggest year-on-year drop since the second world war”. The Press Association says: “The fall is down to predicted declines in the fossil fuels, coal, gas and oil this year, in the wake of countries shutting down their economies and keeping people at home to fight the virus, and the impacts of subsequent recessions. But the IEA warned that, like in other crises, the rebound in emissions after the pandemic could be larger than the decline unless investment in restarting the economy goes towards cleaner and more resilient energy supplies.” S&P Global notes how the IEA says “a reduced lockdown period and a strong economic recovery in the second half of 2020 could limit the annual decline in oil demand to 6.5 million b/d, or 6%, from 2019 levels – 30% below its central forecast of 9.3 million b/d for the year”. The Financial Times says the “staggering” drop in global energy demand is equivalent to India’s total annual consumption, according to the IEA. Reuters quotes the IEA’s executive director Fatih Birol: “Some countries may delay the lifting of the lockdown, or a second wave of coronavirus could render our current expectations on the optimistic side.“ However, many publications lead with the IEA’s positive outlook for renewables. The Guardian says that IEA thinks “renewable electricity will be the only source resilient to the biggest global energy shock in 70 years triggered by the coronavirus pandemic”. Bloomberg says renewables will be the “only winners”, according to the IEA. Science says the IEA believes the Covid-19 crisis “could transform how the world gets its energy”. Climate Home News quotes the IEA saying that “renewable energy has so far been the energy source most resilient to Covid-19 lockdown measures”. The New York Times also quotes Birol: “This historic decline in emissions is happening for all the wrong reasons. People are dying and countries are suffering enormous economic trauma right now. The only way to sustainably reduce emissions is not through painful lockdowns, but by putting the right energy and climate policies in place.” Meanwhile, Carbon Brief has published an in-depth summary of the IEA report which includes the key charts.

BusinessGreen Read Article
Shell cuts dividend for first time since 1945 amid oil price collapse

The diverse reverberations of the Covid-19 crisis continue to dominate media coverage. The Guardian reports on the breaking news this morning that Shell has cut its shareholder dividend for the first time since the second world war, following the collapse of global oil prices due to the coronavirus pandemic. The newspaper says: “The oil giant told shareholders, including thousands of retail investors and pension funds, that payouts for the first quarter would fall by two-thirds to 16 cents a share. It is the first time that the FTSE 100’s biggest dividend payer will reduce payouts for its shareholders since the 1940s.” Separately, the Guardian reports that “the planemaker Airbus has warned that the aviation industry could take as long as five years to recover to the levels seen before the coronavirus pandemic”. And Reuters reports that the French government is attaching conditions – of cutting emissions and domestic flights – to a €7bn Air France bailout. Another Reuters piece says that “Norway, Western Europe’s largest oil producer, will slash its output from June to December of 2020, the oil and energy ministry said on Wednesday, the first time in 18 years it has joined other major producers to shore up prices”. In another report, Reuters notes that “US natural gas futures fell on Wednesday on forecasts for milder weather and lower demand – especially export demand – over the next two weeks”. The Press Association reports that “more than 500 North Sea workers are expected to be made redundant by an energy operator as oil prices plummet”. STV News says “Scotland’s energy minister will chair regular meetings of a leadership taskforce in a bid to help the North Sea oil sector survive the plunge in prices caused by Covid-19”. In the US, Reuters reports that “nine companies including Chevron Corp, Exxon Mobil Corp and Alon USA Inc have agreed to rent space to store 23 million barrels of crude in the US emergency oil reserve…as the Trump administration tries to help energy firms deal with the crash in oil prices”. Bloomberg adds that the Trump administration “may announce as soon as Thursday a plan to offer loans to the ailing oil industry possibly in exchange for a financial stake, according to two people familiar with the matter”. Separately, Bloomberg reports that “European utilities with bulging renewable energy portfolios are showing that the way out of the coronavirus slump is coloured green”. It adds: “Energy companies from Orsted A/S to Iberdrola SA reported robust first quarter earnings in a period that has been bedevilled by a slump in energy demand and a collapse in gas prices. Owning large wind and solar portfolios has so far protected those companies from the worst effects of the crisis.” The Financial Times picks up the story saying that “renewable energy developers and utilities are among the rare bright spots this earnings season, with profits holding up despite the coronavirus crisis”. However, a separate FT story has a contrasting take saying: “The global wind power boom is facing a sharp slowdown as coronavirus restrictions hit supply chains, threatening projects with delay or even cancellation.”

In other related developments, Reuters reports new analysis by Moody’s showing that “India’s electricity demand during the current financial year is seen falling for the first time in at least 36 years…a blow to utilities and state-run Coal India Ltd”. Climate Home News says IMF chief Kristalina Georgieva is “urging governments to invest emergency loans in green sectors, scrap subsidies to fossil fuels and tax carbon”. The Financial Times has continuing coverage of the EU’s efforts to “meld” the pandemic recovery with the climate agenda. Scientific American has a feature on “how a warming climate could affect the spread of diseases similar to Covid-19”. Reuters reports new analysis by Lauri Myllyvirta, lead analyst at the Helsinki-based Centre for Research on Energy and Clean Air and frequent Carbon Brief contributor, which shows that “improved air quality in Europe due to lockdowns to combat the coronavirus pandemic has delivered health benefits equivalent to avoiding 11,300 premature deaths”. Finally, Reuters covers how the drought in Argentina has added to the country’s Covid-19 worries. (Additionally, the Guardian reports on Cuba’s “hottest day” and Reuters says the “the Czech Republic is facing its worst drought in 500 years”.)

The Guardian Read Article
Power sector carbon emissions fall by two-fifths during European lockdown

The Press Association reports new analysis published by Carbon Brief showing that CO2 emissions from the power sector have fallen by almost two-fifths across Europe as a result of the coronavirus lockdown. It adds: “Countries locked down economies around a month ago to curb the pandemic, with electricity demand down 14% across the 27 EU member states and the UK over the past 30 days compared to the same period in 2019, figures show. Coal has taken the brunt of the fall, according to the analysis by Dave Jones from climate think tank Ember, and published on the climate and energy website Carbon Brief.” MailOnline also covers the story, saying: “Power generation from both brown coal and hard coal are both down more than 40% over the past month compared with last year, due to the costs involved. The UK, in particular, has gone a record-breaking period of 19 days without using coal-generated power – the longest stretch since the Industrial Revolution. In place of carbon-belching coal, Europe has seen a rise in more environmentally-friendly forms of power generation, including wind and solar. The lack of coal burning as a power source has been due to the costs associated with running coal plants in a financially unstable period, suggesting electricity systems can switch away from coal for good.”

Press Association Read Article

Comment.

Green deals are the best way to turbo-charge economic recovery from Covid-19

The Daily Telegraph’s international business editor begins his latest column by noting how “every big recession over the last forty years has been a body blow for green energy and the climate cause”. But he continues: “Climate activists fear the worst again, and this time the world has no margin for error. They need not fear. The balance of advantage now lies with the greens. The market has switched sides. Big Money is no longer aligned with Big Oil. It would take active political intervention and subsidies in favour of the fossil industry to prop up the old edifice at this juncture…The Paris accord has shifted global politics irreversibly. So has last year’s report by the Intergovernmental Panel on Climate Change warning that the CO2 risk thresholds are even lower than we feared and that we have just a decade to head off cataclysmic tipping points. The pandemic has shown what nature can throw at us.” He concludes: “There will be no retreat from climate targets in most of the world. The US will reengage with Paris once the Trump anomaly is over next January. It is the oil and the fossil industry that will never fully recover…When we finally return to something near normal, the first big wave of electric cars will be hitting the market at competitive prices and the tightening regulations of the post-Paris order will be palpable. To the extent that oil prices rebound, so will US frackers under new equity ownership. The gains will be capped. The petro-states may discover that their last chance to milk the hydrocarbon cash cow and rebuild their wealth buffers has vanished forever.”

An editorial in the Economist argues that “the pandemic should neither distract people from action on climate change nor confuse them about it”. Separately, the Economist carries a feature and an editorial about the car industry’s “short-term crisis and long-term decline”: “Sitting on $1.3tn-worth of legacy investments in factories that rely on a technology that ought to become obsolete – the internal-combustion engine – the likes of Ford, Renault and Volkswagen don’t exactly look well positioned for the 21st century.” James Murray in BusinessGreen walks through some of the “genuine good news” for the climate amid the Covid-19 crisis: “Cynicism still has a vitally important role to play, especially when the past decade has seen global emissions spiral upwards even as more and more governments and businesses have nominally pledged to decarbonise. But in the midst of a crisis sometimes it is worth reflecting that beyond the warm words on climate action, tangible steps forward are being made. There is actual, genuine, good news to be found, if you know where to look.” The Daily Telegraph has a comment piece by Josephine Moulds on “why negative oil prices are the new Big Short” in which she notes that “an unusual mix of ruthless capitalism and climate zeal is pushing traders to ramp up bets against fossil fuels”. Meanwhile, Allister Heath, who edits the Sunday Telegraph, has a column in the Daily Telegraph which looks at the “10 most important ways” the Covid-19 crisis will transform our lives: “The environmental movement will also suffer: the focus will be on tangible crises such as pandemics, antibiotic resistance or nuclear proliferation, and the cost of living and jobs.” Troy Vettese in the New Statesman looks at whether this is the “end of big oil”. Finally, Bloomberg carries a couple of comment pieces, the first of which is by BloombergNEF’s Nathaniel Bullard in which he argues that the “coronavirus should recharge the push for zero-carbon energy”. Separately Bloomberg’s Liam Denning warns not to leave the US’s post-pandemic energy policy to chance: “government planning is the key to building the sustainable, competitive and resilient energy system we need”.

Ambrose Evans-Pritchard, The Daily Telegraph Read Article

Science.

Robust ecological drought projections for drylands in the 21st century

“Large portions” of the drylands of the US and Canada are likely to see changes in ecological drought over the 21st century, a new study says. Using an ecosystem water balance model and climate model projections, the researchers find “strong regional differences in long-term drought trajectories”. The study projects “chronic drought increases” in southern areas, notably “the Upper Gila Mountains and South-Central Semi-arid Prairies”, and decreases in the north, “particularly portions of the Temperate and West-Central Semi-arid Prairies”. The researchers also find that “exposure to hot-dry stress is increasing faster than mean annual temperature over most of these drylands”.

Global Change Biology Read Article
CESM2 climate forcing (1950–2014) yields realistic Greenland ice sheet surface mass balance

A new “brief communication” paper outlines how a high-resolution climate model has been used to reconstruct the surface mass balance (SMB) of the Greenland ice sheet over 1950-2014. Comparing the output with existing reanalysis products, the researchers show that it “realistically represents the long-term average and variability of individual SMB components and captures the recent increase in meltwater runoff”. Therefore, “for the first time”, model output can be used without any direct observations or “additional corrections” to reconstruct past SMB, the researchers say. They conclude: “This paves the way for attribution studies of future Greenland ice sheet mass loss projections and contribution to sea level rise.”

The Cryosphere Read Article

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Get a Daily or Weekly round-up of all the important articles and papers selected by Carbon Brief by email. By entering your email address you agree for your data to be handled in accordance with our Privacy Policy.