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Daily Briefing |

TODAY'S CLIMATE AND ENERGY HEADLINES

Briefing date 09.02.2023
Shell directors personally sued over ‘flawed’ climate strategy

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News.

Shell directors personally sued over ‘flawed’ climate strategy
The Guardian Read Article

The directors of oil major Shell are being “personally sued over their climate strategy”, the Guardian reports. It explains: “Environmental lawyers ClientEarth have filed the lawsuit against the 11 directors at the high court in England. It is the first case in the world seeking to hold corporate directors liable for failing to properly prepare their company for the net-zero transition, ClientEarth said.” The paper adds that the suit is being supported by “a group of large pension funds and other institutional investors”. The Financial Times reports: “The claim brought to the High Court involves the allegation that 11 current directors of Shell, led by chair Andrew Mackenzie, had breached their duties under UK law to properly manage the ‘material and foreseeable’ risks from climate change.” It adds: “The case comes after the world’s oil majors, including the UK-headquartered Shell and BP, have in recent weeks reported record 2022 profits thanks to soaring energy prices driven by Russia’s war on Ukraine.” Reuters and Bloomberg also have the story. Meanwhile, Press Association reports: “Energy firm Equinor under fire after posting record £23.8bn profits.” A separate report in the Guardian is titled: “Britain’s biggest gas supplier accused of ‘profiteering’ from energy crisis.”

Elsewhere, Politico reports: “It’s boom time for fossil fuel companies – and that’s spurring a growing clamour for Europe’s governments to boost their tax take.” The Hill reports on the “political backlash, including from the White House, as Democrats seek to draw a contrast between the pay the companies receive and the economic struggles of ordinary Americans”. (For related comment, see below.) Separately, Reuters reports: “Norway’s $1.35tn wealth fund said on Thursday it would step up its engagement with companies over the management of climate risk by voting against board members who it deems are not doing enough on the issue.”

White House rejects report that US was behind Nord Stream sabotage
Agence-France Presse Read Article

The White House has, reports Agence-France Presse, “flatly rejected…a new report by veteran investigative journalist Seymour Hersh that the US was behind the sabotage of the Nord Stream gas pipelines last year”. It says the “self-published report” by Hersh was described by a White House spokesperson as “complete fiction” and by a Central Intelligence Agency spokesperson as “completely and utterly false”.  The piece goes on to say that the Norwegian foreign ministry described the report’s allegation that it, too, had been involved, as “false”. Reuters also covers the White House response to Hersh’s report, which it says it “has not corroborated”. It adds: “On Wednesday, Russia’s foreign ministry said the United States had questions to answer over its role in explosions on the pipelines.” The Times coverage says of Hersh: “Once hailed ‘the greatest American investigative reporter’, Hersh’s more recent stories have been called into question. These included articles about how the US found Osama bin Laden and calling into question the use of chemical weapons on Syrian civilians by Syria’s regime, which were criticised for relying heavily on anonymous sources and lacking hard evidence.” It adds: “In his report on Nord Stream, Hersh has quoted an anonymous source ‘with direct knowledge of the operational planning’.” The paper adds: “Hersh’s report comes after Sergei Lavrov, the Russian foreign minister, alleged last week that the [Nord Stream] attack had been carried out by Washington in an attempt to ensure its global dominance. Moscow had previously accused the British Royal Navy of blowing up the pipelines but did not provide evidence.”

Wind turbine giant says it has a solution that will keep blades out of landfills
Bloomberg Read Article

Wind manufacturing firm Vestas has developed a chemical solution that allows turbine blades to be broken down and recycled, Bloomberg reports. It says the process could keep blades out of landfill or be used to recycle previously discarded items. OffshoreWIND.biz says the process “renders all existing wind turbine blades recyclable”. It quotes Vestas saying: “Until now, the wind industry has believed that turbine blade material calls for a new approach to design and manufacture to be either recyclable, or beyond this, circular, at end of life. Going forward, we can now view old epoxy-based blades as a source of raw material. Once this new technology is implemented at scale, legacy blade material currently sitting in landfill, as well as blade material in active windfarms, can be disassembled, and re-used. This signals a new era for the wind industry, and accelerates our journey towards achieving circularity.” The site notes that the European wind industry had already committed to keeping old blades out of landfill.

Europe proposes mass exit from energy treaty
Climate Home News Read Article

Climate Home News adds to original reporting from Reuters on the Energy Charter Treaty: “The European Commission has told member countries that a joint EU exit from a controversial international energy treaty appears inevitable, according to a document seen by Reuters, with some of them already announcing they would leave the accord over climate concerns.” The outlet explains that “in recent years [the treaty] has been used to challenge policies that require fossil fuel plants to shut – raising concerns that it is an obstacle to addressing climate change”. It quotes the document seen by Reuters as saying: “A withdrawal of the EU and Euratom from the Energy Charter Treaty appears to be unavoidable.” It says this was confirmed by a European Commission spokesperson.

UK: Government secrecy over net-zero data investigated by watchdog
The Times Read Article

The new UK government department for energy security and net-zero “is facing one of its first challenges as the information watchdog launches an investigation into the government’s refusal to release the figures underpinning its flagship net-zero strategy”, the Times reports. It says a ruling from the watchdog is expected “within months”. The paper adds: “The government must draw up a new net-zero strategy by the end of March after a court last year ruled that the plan was unlawful because of a lack of detail on emissions savings. However, it is understood that minor revisions to the strategy are expected to meet legal requirements, rather than a full-blown new plan.”

Meanwhile, the Daily Telegraph reports: “Households and businesses will be pushed to slash their energy use by 15% by the newly-created department for energy security and net zero.” It adds: “[Prime minister] Rishi Sunak has made the target, to be achieved by 2030, one of the six priorities of the department, which was established in Tuesday’s Whitehall shake-up.” Separately, the Guardian reports: “Greenpeace is threatening to take legal action against the government as it emerged a target to lift millions of struggling households out of fuel poverty is likely to be missed.”

In other UK news, the Guardian reports: “The UK government is being urged to sack one of its trade advisers [former Australian prime minister Tony Abbott] after he joined a thinktank [the Global Warming Policy Foundation] that has denied the scale of the climate crisis and campaigned against net-zero.”

China’s suspended voluntary carbon market moves a step closer to relaunch
South China Morning Post Read Article

China has moved “a step closer to rebooting its suspended voluntary carbon market”, known as the China Certified Emission Reduction (CCER) scheme, and its plans to “develop a more comprehensive market mechanism to support the country’s greenhouse gas emissions goals”, the South China Morning Post writes. It adds that CCER is considered an “important supplementary mechanism” to China’s national Emissions Trading Scheme (ETS), the world’s “largest” carbon market in terms of the emissions it covers, “when it comes to achieving China’s goal of reaching peak emissions by 2030 and carbon neutrality by 2060”.

Yuan Li, an analyst at Shanghai-listed Soochow Securities, is quoted saying that its “relaunch will greatly boost the development of carbon reduction projects such as clean energy, afforestation – planting trees on previously non-forested land – and methane utilisation”. 

China Daily writes that the huge Xinjiang Uygur autonomous region, with its “vast desert expanses of strong winds and intense sunshine”, has become a “pioneer in the country’s new energy drive”. Xinjiang’s renewable energy production reached “37.22 terawatts-hours in 2022, up 25.5% year-on-year”, according to the Xinjiang branch of the State Grid Corp of China, the country’s largest state-owned utility company, the state-run newspaper adds. Another report by the newspaper says that China “aims to increase the share of electric vehicles in the public transport system to 80% in key areas, including bus and taxi services, by 2025, as the country accelerates its steps to promote green transformation amid booming new energy vehicle development”. 

Separately, the Guardian writes that Australian coal cargoes are “scheduled to start arriving at Chinese ports [this week], unwinding an unofficial ban imposed amid fraying bilateral relations two-and-a-half years ago”. It adds that the “resumption of the bilateral coal trade marks a significant improvement in relations”, which hit a “low point” at the start of the pandemic after Australia “pushed for an independent investigation into the origins of Covid-19, angering Beijing officials”.

In other news, Xinhua writes that, “off to a good start in 2023, China’s economy is seeing a faster-than-expected recovery, which is boosting confidence and nurturing new impetus both domestically and abroad”. Reuters reports that oil prices “climbed more than 3%” on Tuesday after the head of the US central bank “eased market concerns over interest rate hikes, while recovering demand in China also boosted prices”.

Comment.

Windfall taxes are not the only option for fossil fuel profits
Pilita Clark, Financial Times Read Article

Commenting in the Financial Times, associate editor and business columnist Pilita Clark writes: “In the past two weeks, ExxonMobil, Chevron, BP and Shell have reported their combined annual profits for 2022 added up to a record-crushing $160bn.” She continues: “That’s a sign of the astonishing pay-off oil companies have had from soaring energy prices driven by Russia’s invasion of Ukraine. And as governments grapple with the cost of living aftershocks, plus rising climate change concerns, there are predictable demands for tougher windfall taxes.” But this is not the only opinion, Clark writes: “One idea that British academics have been pushing for years is gathering pace. It would make fossil fuel companies pay to clean up their carbon emissions in a way that would create a safer climate at a relatively affordable cost. This so-called ‘carbon takeback obligation’ would not require carbon taxes or direct taxpayer subsidies and a version of it made it into last month’s weighty UK government net-zero review by Conservative MP Chris Skidmore.” A comment for the Guardian by Adam Morton, the paper’s Australia climate and environment editor, is titled: “Fossil fuel companies won’t save us from climate change. We need governments to step up.”

In the Daily Telegraph, chief city commentator Ben Marlow writes: “BP continues to walk a tightrope between keeping shareholders onside with lavish payouts and reining in oil exploration to satisfy environmentalists, at the same time as pushing further and faster into green projects.” He continues: “[T]he issue isn’t just that BP is a reluctant champion of renewables, or that traditional shareholders lack the incentive to encourage its adoption of green energy. A bigger question is this. How realistic is it, really, to think that an outfit that has spent the last century drilling relentlessly for hydrocarbons in every corner of the planet can completely reinvent itself as a business that builds and operates wind turbines, solar farms, and electric car charging points? The reality is that BP and Shell are being asked to focus on new technologies that are as alien to them as the combustion engine was to horse breeders.”

Europe breaks new ground in backing strategic green industries
Alan Beattie, Financial Times Read Article

In the Financial Times, senior trade writer Alan Beattie says: “Until now, industrial policy in the EU has been restrained by tough competition laws.” He continues: “Yet when EU heads of government meet today and tomorrow in Brussels to plan their version of Joe Biden’s green tech splurge, they will be exploring some new territory. A growing number of leaders worry the traditional EU role of promoting internal competition is insufficient to create globally commanding positions in the investment-heavy technologies of the future…Now, even instinctively liberal economists accept that more state-guided investment might be appropriate for green industries which have a fast-advancing technological frontier and early-mover advantage.” He concludes: “Designing an EU-wide industrial policy which can address cross-border supply chains will involve a significant break with the philosophies and institutions of the past. It’s going to take time and encounter resistance. But the urge to respond to the US’s green investment binge, let alone China’s, should mean a lot of new ground can be broken.”

Related reporting from Politico says: “First came the shock. Then the outrage. Now, European countries seem to be moving toward acceptance of a massive US clean energy subsidy package that has roiled transatlantic trade relations.” A comment for Energy Monitor is titled: “Selling the Inflation Reduction Act is Joe Biden’s next test.” Elsewhere, Semafor says: “European ministers failed again this week to convince the US to soften its landmark climate-tech spending program.” An article for the Guardian “Our unequal earth” says the US law “promotes corn-fed ethanol refineries and manure-based energy production that could unintentionally supercharge fertiliser and faecal contamination”.

How India is battling deadly rain storms as climate change bites
Gayathri Vaidyanathan, Nature Read Article

A Nature “news feature” explores how India is coping with “increasingly difficult to forecast” South Asian weather due to “monsoons grow[ing] more erratic – and global warming is raising the risk posed by violent storms”. The piece says: “Throughout South Asia, natural weather disasters are occurring more frequently and with greater intensity – which some researchers link to alterations in the monsoon, changes to the natural landscape and global warming.” It quotes one climate scientist working in India saying: “South Asia is like a poster child for climate change…Even as a climate scientist, I cannot imagine the impacts that South Asia would see. We are not prepared for the events that we already have.”

Michael Liebreich wants existing low-carbon technologies to be scaled up much faster
Michael Liebreich, The Economist Read Article

Writing for the Economist “By Invitation” column, Michael Liebreich, founder of Bloomberg New Energy Finance, responds to an earlier piece by venture capitalist Vinod Khosla, which had argued for delaying deployment of existing technologies in favour of research on new solutions, and had said that wind and solar “can only be a minority share of our electric-power generation…because they are not reliable enough to comprise so-called ‘baseload power’”. Liebreich responds by saying: “Three things have changed, however, and the concept of baseload is, in effect, dead.” He explains: “The first is that wind and solar are now the cheapest way of generating electricity almost everywhere – whatever Khosla thinks. The second is that, just as variable renewables are loosening operators’ iron grip on the supply side, digital technologies are giving them ways to influence the demand side (for instance, by encouraging consumers to use hot water or charge their vehicles at off-peak times). The third is that the cost of short-term storage has plummeted.” He continues: “The only real challenge that remains, as generation from wind and solar soars, is how to cover multi-day outages.” Solutions include pumped storage hydro, long-distance electricity interconnectors and hydrogen storage, Liebreich says. He adds that, contrary to Khosla’s view that “hoping to deploy today’s innovations globally is unrealistic”, on the contrary: “Wind and solar power, in fact, provide the perfect illustration of why we need to start rolling out existing clean technologies even before they are fully competitive. First, what we learn from building wind and solar facilities at scale is at least as important as lab research in driving down costs. Second, the decades it takes for new energy and transport technologies to get to global scale means we cannot afford to wait.” Liebreich concludes: “The point is not that we should stop investing in potential breakthrough technologies, far from it. There will be more than enough demand for additional sources of cheap, clean energy in the second half of the century. The point is that we need to be realistic about how long new energy technologies take to reach a scale relevant to the problem of climate change. We have no choice but to deploy the technologies we have today if we are to stay on track.”

Labour fuels
Editorial, The Sun Read Article

An editorial in the Sun rails against a Social Market Foundation commentary, which discusses reports that chancellor Jeremy Hunt is considering what it calls “the largest unfunded fuel duty cut in British history”. The Social Market Foundation says this is “at odds” with the government’s “repeated[] commitment to fiscal responsibility” and notes that the cost of repeatedly cancelling fuel duty increases in line with inflation over the past 12 years “will tick past £100bn in the next fiscal year, according to the OBR [Office for Budget Responsibility]”. The Sun editorial says: “In reality freezing it each year has saved drivers a fortune over a decade. The SMF hates that. It reckons it’s bad for the environment and would vastly prefer that cash going to the Treasury.” (The Social Market Foundation commentary cites 2020 Carbon Brief analysis, which found that the UK’s total carbon dioxide emissions were as much as 5% higher than they would have been if fuel duty had gone up in line with inflation as planned.)

Science.

Increasing Alaskan river discharge during the cold season is driven by recent warming
Environmental Research Letters Read Article

Cold season (October to April) Arctic river discharge has increased by 10% per decade over the past 60 years, according to new research. The authors analysed more than 60 years of climate reanalysis and river discharge observation data. They find that the most widespread discharge increase occurred in April, when most basins sea ice break up. Meanwhile in October, when river ice formation generally begins, average monthly discharge increased by 7% per decade. These trends are “directly related” to recent increases in air temperature, the paper concludes.

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