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Daily Briefing |

TODAY'S CLIMATE AND ENERGY HEADLINES

Briefing date 08.07.2022
UK maps out £54bn of wiring to connect offshore wind farms

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News.

UK maps out £54bn of wiring to connect offshore wind farms
Bloomberg Read Article

The UK’s National Grid has laid out plans for a £54bn upgrade to the electricity grid to connect up its growing fleet of offshore wind farms, reports Bloomberg, which describes the investment as the “biggest since the 1950s”. The current government set a goal to reach 50 gigawatts (GW) of offshore wind capacity by the end of the decade will require a “huge upgrade to cabling infrastructure”, the outlet explains. Fintan Slye, executive director of National Grid’s electricity system operator (ESO), said the plan “is a key step in providing certainty to offshore wind developers and mitigating potential impacts on the environment and local communities from energy infrastructure”. The outlet adds that “making efficient use of the power network will save consumers £5.5bn, the equivalent of £2.18 per year on the average customer electricity bill”. The Press Association says that the “series of documents” published by the ESO lay out the “investment needed from grid companies such as SSE and ScottishPower”. It explains that this unlock £54bn and create up to 168,000 jobs by 2030″. The Times also has the story.

Meanwhile, there is continuing coverage of the UK’s biggest ever renewables auction yesterday, which will support “construction of 11GW of new renewable power generation, which could generate enough energy to supply 12m homes”, says the Times. It adds that “the biggest contract awards were for five new offshore wind farms that are due online from 2026 and have contracted to sell power to consumers at £37.35 per megawatt-hour – a fraction of the cost of generating electricity in gas-fired power stations at present”. Kwasi Kwarteng, the business and energy secretary, said: “Eye-watering gas prices are hitting consumers across Europe. The more cheap, clean power we generate within our own borders, the better protected we will be from volatile gas prices that are pushing up bills,“ the paper reports. The Daily Telegraph declares in its headline that the price of offshore wind power has hit a “record low”. It also notes that “tidal stream power” was included in the auction for the first time, “alongside offshore and onshore wind and solar power”. CityAM adds: “Overall, 93 projects with existing planning permission across England, Scotland and Wales won contracts through the competitive auction process, which is more than in all three previous rounds combined.” The Scottish edition of the Times reports that the renewables investment in Scotland has the “potential to create a jobs windfall”, adding: “Industry groups believe thousands of jobs could be created across the renewables supply chain in the coming years.”

Elsewhere, the Daily Telegraph reports that the proposed new nuclear power plant at Sizewell C plant in Suffolk has been “plunged into fresh uncertainty…as ministers said that no decision on whether to grant it planning permission will be made until 20 July”. The paper explains: “A decision on the 3.2GW plant in Suffolk was meant to be announced on Friday (8 July), already six weeks later than initially planned. Paul Scully, a business minister, said the new deadline was to make sure the business secretary Kwasi Kwarteng had enough time to consider the proposal.”

And, finally, Bloomberg reports on analysis by the Office For Budget Responsibility (OBR) that shows “Britain’s path toward zeroing out its greenhouse gas pollution may cost a third less than expected if natural gas prices remain elevated”. This reduction was “not because getting to net-zero has become cheaper in absolute terms” the OBR says, but “because not getting to net-zero has become more expensive as a result of higher fossil fuel prices”.

UK heatwave: health alert issued as highs of mid-30Cs forecast
The Guardian Read Article

The UK is expected to see the start of a heatwave over the weekend, reports the Guardian, with temperatures likely to reach the mid-30Cs by the middle of next week. It continues: “The warm spell is expected to continue through much of next week and the following weekend, especially in the south of England, and a level 2 heat health alert has been issued for southern and eastern areas.” Temperatures “could touch 35C by mid-July”, the paper notes. The heat health alert “is designed to help healthcare workers manage through periods of extreme temperatures and has four levels”, BBC News explains, adding: “Level 2, called alert and readiness, is triggered as soon as there is a 60% risk that temperature thresholds will be reached in one or more regions on at least two consecutive days and the night in between.” BBC Weather presenter Nick Miller said that “some places are likely to see their highest temperature of the year so far”. The Independent also has the story.

Meanwhile, Associated Press reports that the EU’s executive warned that Europe is facing one of its toughest years when it comes to natural disasters like droughts and wildfires because of increasing climate change. EU Commissioner Maroš Šefčovič told legislators yesterday that “the present drought in Europe could become the worst ever”. He added: “Statistics show that since 2017, we have the most intense, intense forest fires ever seen in Europe. And that we unfortunately expect the 2022 forest fire season could follow this trend.”

Elsewhere, there is continued reaction to the deadly collapse of an Italian glacier at the weekend. Politico says: “Early scientific assessments suggested that the collapse was the result of both long-term melting and a superheated spring in which temperatures sat stubbornly above zero, even at high altitude.” While Italian prime minister Mario Draghi said the government would take action “so that what has occurred has a very low chance of happening [again] or can even be prevented”, the outlet says that the “reality is that no one…can control the impact of global warming in the Alps”. And the New York Times says: “Italy is suffering through another prolonged and scorching heat wave, which contributed to the disaster and has brought the worst drought in 70 years along the Po River, its longest waterway, cutting off fountains and parching parts of the country.” Finally, the Financial Times reports on how farmers are “feel[ing the] heat as northern Italy suffers worst drought in decades”.

US: Chuck Schumer, Joe Manchin work to clinch deal on climate and energy
The Washington Post Read Article

US Democrats are “racing to finalise a revised proposal to tackle climate change and jump-start the nation’s transition to clean energy, part of a larger sprint to strike a deal with Senator Joe Manchin III on their stalled spending bill this month”, reports the Washington Post. The “frenzied deliberations” follow “weeks of private talks between Senate majority leader Charles E Schumer and Manchin, a centrist who scuttled negotiations over the party’s last attempt at a broader spending package in December”, the paper explains. Last year, it says, “Democrats proposed placing a fee on oil and gas companies’ methane emissions as part of their ill-fated legislative package, known as the Build Back Better Act”, but Manchin raised concerns, saying it would be duplicative of proposed regulations from the Environmental Protection Agency (EPA). Two people “familiar with the matter” tell the paper that Democrats are now working out with Manchin a potential solution that would exempt companies from the methane fee if they comply with the EPA regulations once the rules are finalised. It adds: “While top Manchin aides say they are far from a deal, some Democrats are still hoping to finalise a retooled climate proposal as soon as next week, when lawmakers are set to return from recess”. Democrats will argue “their case to the Senate rules chief on why the package should pass with a simple majority in the chamber”, says Politico, adding: “No one is getting their hopes too high in a party still reeling from Manchin’s rejection of Build Back Better, Democrats’ previous version of the legislation.”

In other US news, the New York Times looks at the “other regulatory tools” available to the Biden administration after the supreme court ruling last week that “took away a major tool for reducing greenhouse gas emissions”. Reuters reports that the US “has agreed to lift tariffs on Canadian solar products after a trade dispute settlement panel sided with Ottawa earlier this year”. And the New York Times “New York Today” newsletter reports on “several low-profile yet important climate laws that governor Kathy Hochul signed into law this week”.

Germany: Green light for coal as a gas substitute
Frankfurter Allgemeine Zeitung Read Article

Frankfurter Allgemeine Zeitung (FAZ) reports that Germany’s lower house of parliament, the Bundestag, “has cleared the way for temporarily using more coal-fired power plants to generate electricity” due to severe throttling of Russian gas supplies through the Nord Stream 1 pipeline. At the same time, MPs have decided to ease state aid for ailing energy companies such as Uniper, adds the newspaper. As an option, it continues, “a pay-as-you-go system can also be created so that gas price increases for energy suppliers can be passed on more evenly to customers”. The Bundestag rejected an amendment by the parliamentary group that aimed to extend the lifetime of nuclear power plants, tells FAZ. It adds that a few hours after the adoption of the new legislative package to promote renewable energies in the Bundestag, the Schleswig-Flensburg district chairman of Greens, Rainer Borcherding, announced: “I support the efforts to accelerate the urgently overdue energy transition in all essential points…[but]…the new wind and nature conservation laws at the federal level, in which Robert Habeck played a major role as minister for economic affairs, are unbearable in their effect on biodiversity”. Montel reports that the new target implies Germany will cover 80%, or 600 TWh, of its power demand with renewable energy in 2030, up from 49% in the first half of this year. The German government coalition of Social Democrats, Greens and Liberals aims to reach the renewable energy expansion with rules to provide higher subsidies for roof-top solar as well as more land to ground-mounted solar units and onshore wind turbines, explains Montel, adding that the law package is scheduled to pass the Bundesrat upper house of parliament today.

Meanwhile, Handelsblatt reports that the German federal government is also preparing participation in more than 30% shares of gas trader Uniper due to its credit rating, said several people familiar with the matter on Thursday. It will also deal with how energy traders such as Uniper will be allowed to pass on the higher purchase prices for gas to consumers in the future, regardless of existing contracts, adds the media outlet. Reuters also has a story.

Finally, Financial Times reports that “Germany is rationing hot water, dimming its street lights and shutting down swimming pools as the impact of its energy crunch begins to spread from industry to offices, leisure centres and homes”. FT quotes the head of the federation of German housing enterprises: “The situation is more than dramatic…Germany’s social peace is in great danger”.

EU lawmakers back mandatory use of green jet fuel from 2025
Reuters Read Article

The European Parliament yesterday “backed landmark rules on aviation fuel that set binding targets for the replacement of kerosene with less polluting energy sources”, reports Reuters, but “extended the definition of what a green fuel could be”. The newswire continues: “The requirements, which if approved would be a world first, were originally proposed by the European executive commission last year to cut the climate impact of the aviation sector…Under the approved text, suppliers would be required to blend a minimum of 2% of sustainable aviation fuel (SAF) into their kerosene from 2025, rising to 85% in 2050 – more ambitious than the target of 63% by 2050 originally proposed by the Commission.” However, under the terms of the Commission’s original proposal, “SAF would include bio-based fuels obtained from recycled waste and, on a smaller scale, hydrogen-based synthetic or e-fuels produced from renewable energy sources”, the article says. And the version of the rules approved by the European Parliament extended this definition, “adding recycled carbon fuels produced from waste-processing gas, and biofuels produced from animal fats or distillates”. The newswire notes that “before the vote, EU energy commissioner Kadri Simson had urged lawmakers not to extend the definition of SAF, and to be careful with excessively ambitious targets”.

Elsewhere, BusinessGreen reports that on new research that shows the “world’s biggest airlines continue to lobby behind-the-scenes in Europe for policies that undermine global climate goals, despite their public support of net-zero goals”.

China's summer floods and heat waves fuel plans for climate action
The Washington Post Read Article

The Washington Post has published a news feature looking at how the latest extreme weather events to hit China might impact the government’s climate and energy policies. It quotes Li Shuo, a policy adviser at Greenpeace East Asia: “It’s still early to tell if this summer will elevate public concern on extreme weather events and climate impact to the same level as we saw last year, but the trend line is clear,” he says. The article also cites analysis published recently by Carbon Brief showing that “China’s vast rollout of 570 gigawatts of solar and wind power between 2021-25 is aimed at laying the groundwork for a sharp decline in the second half of the decade”.

Relatedly, Reuters reports that “heavy rain battered China’s northeastern rust-belt” on Thursday, adding that this “trigger[ed]” floods that “trapped buses, swamped roads and disrupted commuters in cities”, with “more storms forecast for coming days”. The article continues: “Since June, China has been grappling with extreme weather from heatwaves to historic floods, with meteorologists blaming climate change and also the first typhoon of the season, Chaba.”

Meanwhile, China’s Ministry of Commerce and 16 other departments on Thursday jointly announced “a raft of new steps to spur consumer demand for cars”, saying it would “consider extending a tax break for electric vehicles and outlining plans to build more charging stations and encourage lower charging fees”, according to a separate report by Reuters. The plans “boosted” shares of Chinese automakers, with Geely “surging 6%” and Great Wall Motor “rising 4%”, the newswire says.

Separately, the South China Morning Post writes that the country’s “first batch” of “carbon neutrality exchange-traded funds (ETFs)” have “raised more than 13bn yuan ($1.9bn)” as of Wednesday, according to local media reports. The outlet says the move comes as “Beijing’s carbon reduction campaigns boost interest in sustainable investing”. The funds are also “expected to boost the development of green finance and will stimulate the growth of industries such as clean energy and photovoltaics”, the outlet adds, citing analysts.

Elsewhere, the Global Times, a state-run newspaper, citing a report by the Shanghai-based outlet Jiemian, writes that China’s Ministry of Commerce has allocated a “new 5m tonnes oil product export quota”, bringing the total refined fuel export quota so far in 2022 to “22.5m tonnes”, which is “down 40.2% year-on-year”. It cites a researcher saying the decline is due to constrained global demand and adding that China’s refineries are having to transform in line with the country’s pledge of reaching carbon neutrality by 2060.

Finally, the state-run website China.org has published an opinion piece by Tom Fowdy, a British political and international relations analyst, titled, “China’s push for renewable energy transition”. He says that China has so far made “remarkable progress in its clean energy transition, becoming one of the biggest investors in solar and wind power in the world”. He adds: “Chinese authorities have introduced a raft of measures to boost energy efficiency and reduce carbon emissions.”

Plant-based meat by far the best climate investment, report finds
The Guardian Read Article

In an “exclusive”, the Guardian reports that investments in plant-based alternatives to meat “lead to far greater cuts in climate-heating emissions than other green investments”. According to new analysis by the consultancy firm Boston Consulting Group (BCG), “for each dollar, investment in improving and scaling up the production of meat and dairy alternatives resulted in three times more greenhouse gas reductions compared with investment in green cement technology, seven times more than green buildings and 11 times more than zero-emission cars”, the paper explains. This high impact on emissions is because of of “the big difference between the greenhouse gases emitted when producing conventional meat and dairy products, and when growing plants”, the paper adds. Malte Clausen, a partner at BCG, said: “There’s been a lot of investments into electric vehicles, wind turbines and solar panels, which is all great and helpful to reduce emissions, but we have not seen comparable investment yet [in alternative proteins], even though it’s rising rapidly…If you really care about impact as an investor, this is an area that you definitely need to understand.”

Elsewhere, the Independent reports on research by the Changing Markets Foundation, which warns that “profits are at risk if the meat and dairy industry does not curb its methane emissions and other climate pollutants”.

HSBC banker quits over climate change furore
Financial Times Read Article

HSBC Asset Management’s head of responsible investing has resigned after giving a speech earlier this year that accused policymakers of overstating the financial risks of climate change, the Financial Times reports. Stuart Kirk told an FT event in May that central bankers were bidding to “out-hyperbole the next guy” with their dire warnings about the threat to investors and banks of global warming, the paper explains. His speech – entitled: “why investors need not worry about climate risk” – drew public criticism from HSBC which suspended Kirk pending an internal investigation, the paper says. In his speech, Kirk said that throughout his 25-year career in the finance industry “there was always some nut job telling me about the end of the world” and likened climate change to the Y2K bug that predicted a widespread computer glitch at the turn of the millennium, the paper continues: “On Thursday he announced on LinkedIn that he was quitting the bank, insisting there was ‘no place for virtue signalling in finance’ and added: ‘If companies believe in diversity and speaking up, they need to walk the talk. A cancel culture destroys wealth and progress.’” Reuters notes that HSBC, “which has committed to playing a major role in leading the global economy in the transition to net-zero, declined to comment”. The newswire adds that “it was unclear whether an internal investigation launched by the bank into Kirk’s comments was completed prior to Kirk’s LinkedIn post”. The TimesDaily Telegraph and South China Morning Post also have the story.

Comment.

Green Tories fear lurch away from progress on climate after Johnson
Fiona Harvey, The Guardian Read Article

There is widespread reaction to the (gradual) resignation of UK prime minister Boris Johnson yesterday. The Guardian’s environment correspondent Fiona Harvey writes that “one group will be lamenting the end of the Johnson era: green Tories have seen the prime minister as their best hope for years, and are concerned that his successor will not live up to his promises”. She notes that “Johnson’s premiership has brought more major environmental legislation and arguably greater progress on tackling the climate and nature crises than either of his Conservative predecessors in the past decade”. Although “campaigners also said Johnson’s green achievements were fragile, flawed and undermined by U-turns and omissions”, she adds. BusinessGreen notes that “several leading government ministers responsible for driving the government’s green policy agenda have quit” over the last few days.

Financial Times editorial argues that “some of Johnson’s legacy is worth nurturing”, adding: “Most importantly, Johnson has prioritised climate change in a way that is diametrically opposed to rightwing populists elsewhere in the world. It would be wrong, both politically and ethically, for his successor to abandon that fight, even if it will be complicated temporarily by high energy prices.” Robert Shrimsley – UK chief political commentator and UK editor at large of the Financial Times – warns of “a tussle over net-zero” between would-be successors to Johnson, with “many on the right wishing to abolish green levies and recommit to fossil fuels”. But, he says, “aside from the moral arguments, elections elsewhere suggest Tories should be wary of straying too far from Johnson’s green agenda”. BusinessGreen‘s editor James Murray writes that Johnson’s premiership has “ended in failure”, with the “opportunity to shape a new era of climate action squandered by a fundamental lack of seriousness”. Jon Whiteaker – senior editor at Investment Monitor – writes in sister publication Energy Monitor that “Johnson has promised greater energy security for the UK, with wild promises of building one new nuclear power station every year. The hastily brainstormed ideas in this strategy did not come with firm funding commitments, and his government had little idea of how to tackle a growing cost-of-living crisis”. And the Independent’s climate correspondent Saphora Smith looks at the “pressing climate decisions facing next prime minister”.

The Sun is less concerned about the fate of the UK’s climate policy, noting in its editorial that Johnson’s “blind faith in net-zero regardless of cost was madness”. The paper calls for the “end to wasteful wokery”, adding: “The new PM must tackle pump prices with much bigger cuts to duty and VAT. They must scrap or suspend green levies on energy bills and order a forensic financial review into our commitment to net-zero by 2050. If the costs look ruinous, let us be much more realistic about what can be done. Britain must start fracking for shale gas. Net-zero will never be achieved without more UK-produced energy to tide us over. For our security, and lower prices, shale looks essential.” [It is, by Carbon Brief’s count, the 14th editorial published this year by the Sun which has advocated for fracking in the UK.] A Daily Mail editorial makes a similar point, saying Johnson’s successor should “run on an unashamedly True Blue ticket”, which should include “a proper energy policy that acknowledges the deficiencies of renewables and a pragmatic approach to fracking and nuclear”. In his Daily Telegraph column, the climate-sceptic Conservative peer Lord David Frost criticises some of the “appalling decisions” made by Johnson’s government on energy policy. He says: “VAT and renewables subsidies need to come off bills, storage capacity increased, and the crazy rush to technologically suspect renewables slowed.” [Frost might have missed the news – reported in the same paper as his column appears – that the price of offshore wind power in the UK has fallen to a record low. See above.]

The Guardian view on the global food crisis: no time to lose
Editorial, The Guardian Read Article

Hunger is “stalking the world”, says a Guardian editorial, with 345 million people “currently experiencing acute food insecurity”. It continues: “Covid-19 and the climate emergency had seen that tally rise from 135 million people before the pandemic to 276 million by early this year, reflecting a 55% increase in the Food and Agriculture Organization’s food price index since May 2020.” The war in Ukraine “has exacerbated increases in freight and fertiliser costs due to rising fuel prices, and has blocked ports”, the paper says. And while G7 leaders have “pledged an extra $4.5bn to tackle the food crisis last month, that was just a fraction of the $28.5bn that experts say is needed”. The editorial argues that, beyond food aid, “a substantive shift in global agricultural policies is needed”, adding: “Countries should redirect domestic support towards sustainable farming and nutritious foods, reducing their reliance on imports. Others, notably the US, should prioritise grain for human consumption over biofuels.” The paper concludes: “Above all, action must be taken urgently. It may already be too late to save some lives. We must prevent more being lost.”

Science.

Climate change increases resource-constrained international immobility
Nature Climate Change Read Article

Climate change impacts may reduce the ability of low-income populations to migrate to new areas by 2100, according to a new study. Using an integrated assessment model (IAM) that includes income distributions and migration dynamics, researchers explore how different climate scenarios could affect global migration patterns by the end of the century. They find that under moderate development and climate scenarios, migration of the lowest-income people will decrease by 10%, as compared to 35% for “more pessimistic scenarios including catastrophic damages”. They write that this “would leave resource-constrained populations extremely vulnerable to both subsequent climate change impacts and increased poverty”.

Permafrost cooled in winter by thermal bridging through snow-covered shrub branches
Nature Geoscience Read Article

A new study finds that Arctic shrubbery has a cooling effect on subsurface permafrost during the wintertime, but that this effect is reversed in the spring. Researchers use meteorological and soil data from the Canadian Arctic, then model the heat transfer through the soil. They find that the shrubs act as a “thermal bridge” through the snow, providing a cooling effect of 1.21C during the winter months. The overall effect is likely to vary from place to place, the authors say, and these processes “may have an important impact on projected greenhouse gas emissions by permafrost”.

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