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Daily Briefing

06.08.2020
Today's climate and energy headlines
DAILY BRIEFING Value of world’s largest coal mine slashed by $1.4bn
Value of world’s largest coal mine slashed by $1.4bn

News.

Value of world’s largest coal mine slashed by $1.4bn

Mining giant Peabody Energy has written off $1.4bn from the value of the world’s largest coal mine, the Financial Times reports, in a move it says is “an acknowledgment of electricity generators’ permanent shift towards natural gas and wind”. The firm’s second-quarter revenue was down by 45% compare to last year, the paper say, noting that Peabody assets following the writedown amount to $4.9bn. Bloomberg says the firm recorded its biggest loss ever as a result of the writedown at the North Antelope Rochelle mine in Wyoming, which accounted for about 12% of US coal production last year. Bloomberg quotes a Peabody statement saying the writedown was due to “changes in multiple assumptions, including lower long-term natural gas prices, timing of coal plant retirements and continued growth from renewable generation”. Separately, the Financial Times reports that Glencore, another mining giant, has reported a net loss of $2.6bn in the first of the year. The loss includes “$3.2bn of impairment charges, including a $1bn hit on the value of its struggling Colombian coal assets”, the paper says. According to Bloomberg, the writedown is due to a collapse in thermal coal prices during the coronavirus pandemic.

In related news, Bloomberg reports that Exxon “warned that low energy prices may wipe as much as one-fifth of its oil and natural gas reserves off the books”. The article adds that Chevron expects to revise down its reserves by 10% and that Total, Shell and BP “have written off billions of dollars in reserves in recent weeks as the [coronavirus] pandemic destroyed oil demand and prices”.

Financial Times Read Article
Government’s ‘pitiful’ planning reforms ‘will cost Britain decades in fighting climate change’

Proposed planning reforms for England and Wales “will cost Britain decades in the fight against climate change…environmentalists have warned”, reports the Independent. It continues: “Countryside charities said plans to make new homes carbon neutral by as late as 2050…as ‘pitiful’ and dramatically less ambitious than previous ambitions scrapped by ministers.” The planning reform news is reported on the frontpage of the Times, which says: “The new standards would stipulate that all new roads are tree-lined and all new homes are carbon neutral by 2050.“ The Daily Mail also reports on page 2 about how “every new housing development in England will be required by law to have tree-lined streets”. Press Association via the Express and Star reports the UK Green Building Council as being “deeply concerned” by this 2050 target. It quotes the council’s director of policy and practice saying: “All new homes must rather be net-zero carbon in operation by 2030 at the latest, in order to meet our national net-zero target.” BBC News reports: “The government is also promising to make all new homes carbon-neutral by 2050, stopping all new buildings from needing retrofitting.” But analysis within the piece by BBC environment analyst Roger Harrabin says the 2050 carbon neutral target “unifies green critics”, adding: “Environmentalists condemned the later date as ‘pitiful’.”

The Independent Read Article
Japan's climate change efforts hindered by biased business lobby: study

Industry lobby group Keidanren “claims to represent all of Japanese business”, but is “dominated by energy-intensive sectors that represent less than 10% of the economy”, Reuters reports, citing a new study from NGO InfluenceMap. It adds: “The influence of the country’s electricity, steel, cement, car and fossil-fuel sectors undermines Japan’s attempts to meet its Paris Agreement commitments, accord to the report.” The piece quotes a former vice environment minister saying the report’s findings are “mostly consistent with my personal experience as a policymaker in Japan [from July 2009 to January 2011]” but that “[w]hat surprises me is that this remains unchanged today”. (See Carbon Brief’s in-depth profile of Japan.)

Reuters Read Article
EU eyes sustainable fuel quotas to tackle aviation emissions

The European Union is considering “sustainable fuel” quotas for airlines, Reuters reports, citing a European Commission consultation issued yesterday. Other options under consideration include a trading system for fuel carbon credits or a tax on jet fuel, the newswire reports. Separately, Reuters reports that a group of Republican senators is supporting an extension to a $25bn payroll assistance programme for US airlines.

Reuters Read Article
China tensions raise doubts over UK nuclear projects

A group of “rebel” Conservative MPs that helped turn the UK government against Huawei are now “turning their attention to a proposed Chinese project to build a nuclear power station at Bradwell-on-Sea in the south-east of England”, the Financial Times reports, in a story trailed on the paper’s frontpage. The Tory rebels are “being encouraged by a US administration vocal in its opposition to China’s involvement”, the paper says, adding: “At a private meeting with MPs last month, the subject of CGN’s [China General Nuclear’s] activities was raised by US secretary of state Mike Pompeo, according to one person in the room.” The Financial Times continues: “CGN was brought in originally because of its willingness to help finance [new nuclear] deals without recourse to UK state cash…Some MPs believe that Britain no longer needs CGN’s money because Boris Johnson’s government may be willing to contemplate public subsidies.”

Financial Times Read Article
US court allows Dakota Access oil pipeline to stay open, but permit status unclear

A US appeals court has ruled that the Dakota Access pipeline does not have to be shut and drained, Reuters reports, but the legal battle over the project continues. The ruling reverses an order from a lower court finding that the pipeline would have to close by 5 August, reports the Hill. It adds that the appeals court findings upheld a requirement for further environmental study of the project. A second Reuters article reports that the companies that use the pipeline “are telling investors they can survive without it”. It adds: “But in legal filings, they have made its closure seem dire.” Separately, Bloomberg reports on a deal between TC Energy Corp and four labour unions on building the Keystone XL pipeline. It says the agreement “could amplify political pressure on [US presidential hopeful] Joe Biden, who has threatened to rip up permits for the project even as he courts blue-collar workers”. Meanwhile, another Bloomberg article reports: “Climate-change activists are pressuring Joe Biden to distance himself from former Obama administration advisers they view as either too moderate or too cozy with the fossil-fuel industry.”

Reuters Read Article
Offshore energy can underpin zero target

The UK’s offshore energy sector “could underpin 60% of the emissions reductions needed to hit the UK’s 2050 net zero target”, the Times says, citing a report from the government-backed Oil and Gas Authority. According to the paper, the authority says 30% of the emissions savings could come from offshore wind, wave and tidal, with the other 30% coming from offshore carbon capture and storage (CCS), hydrogen fuel made from North Sea gas, and oil platform electrification. The Times notes: “The authority was set up in 2015 to regulate, influence and promote the British oil and gas industry. It is funded by an industry levy and is owned by the business department. Its original mission was to maximise the recovery of oil and gas from the North Sea as old fields decline. Reflecting the growing impetus to act on climate change, it is now carrying out increasing work on decarbonisation.”

The Times Read Article

Comment.

Europe’s steel industry needs a credible plan to go green

In the Financial Times, Ben Jones, managing consultant at commodities analysts CRU, writes: “It is hardly surprising that Europe’s steelmakers are showing little sign of voluntarily footing the bill for going green…the level of capital expenditure is beyond an industry struggling with narrow margins and heavy debts.” Prices for end users will need to rise to cover the costs, Jones argues, adding “perhaps $200 or more in the cost of the steel embodied in an average car”. But he says: “The industry may struggle to convince consumers and regulators that any proceeds from higher steel prices will actually be invested in decarbonisation rather than used to pay down debts, corporate dividends as well as relaxing cost discipline.” Jones concludes: “For a greener industrial base to emerge, more of the sector’s revenues will need to flow into public decarbonisation funds that are accountable to consumers akin to the EU Innovation Fund. They should increasingly be looking for credible and ambitious decarbonisation plans by producers before providing the necessary co-financing support.”

Ben Jones, Financial Times Read Article
China, Climate Change, and Covid-19: An Interview With Kevin Rudd

In an interview with the Diplomat, former Australian prime minister Kevin Rudd describes climate change “above all else” as the top challenge facing the Indo-Pacific region. Rudd says: “If governments are also smart in calibrating their economic response to Covid-19, there is also a chance we can emerge from this crisis better placed to decarbonise our economies and bolster our climate resilience.” Separately, the Sydney Morning Herald reports the comments of a former government minister under John Howard, who, the paper says, “has urged the Morrison government to lead global action on climate change, starting with binding reduction targets for greenhouse gases”. Meanwhile another Sydney Morning Herald article reports: “Australia’s heaviest greenhouse-gas emitter, AGL, will face a shareholder push to bring forward the closures of its remaining coal-fired power plants by at least 12 years to help limit the worst impacts of climate change.”

Jongsoo Lee, The Diplomat Read Article

Science.

Thermal displacement by marine heatwaves

A new paper introduces a “thermal displacement” metric for marine heatwaves (MHWs), which are typically characterised by their intensity and persistence at a given location. The researchers use a global sea surface temperature dataset to calculate thermal displacements for all MHWs from 1982 to 2019. The findings show that “thermal displacements during MHWs vary from tens to thousands of kilometres across the world’s oceans”, the study says, and “short-term thermal displacements during MHWs are of comparable magnitude to century-scale shifts inferred from warming trends”. An accompanying News & Views article notes that “thermal displacement is relevant only for species that have some capacity for active movement”. It adds: “Many marine organisms are location-bound and cannot or will not move, such as kelp forests or parents guarding their young.”

Nature Read Article
A temperature of 20C in the UK winter: a sign of the future?

In February 2019, the UK hit a new record winter temperature of 21.2C, exceeding the previous record by 1.5C. In a new paper, a group of Met Office scientists look at how unusual such a warm winter spell was, noting that “it is likely that human-induced climate change will have contributed to the margin by which the temperature record was broken and the corresponding spatial extent of 19 to 20C temperatures”. Looking ahead, they find that “should emissions remain high, by the late twenty-first century we may regularly see winters that have at least 1–2 days hotter than the historical record”. For more on the UK’s record-breaking winter heat in 2019, see Carbon Brief’s media analysis piece.

Weather Read Article
Facility for Weather and Climate Assessments (FACTS): A community resource for assessing weather and climate variability

New research explores the “Facility for Weather and Climate Assessments” (FACTS), a community resource developed by the NOAA Physical Sciences Laboratory that provides a set of analysis tools for “addressing a wide class of problems on weather and climate variability and its causes”. The authors present an overview of “the datasets, the visualisation capabilities, and data dissemination techniques of FACTS”. The paper provide examples from published studies that have used data downloaded from FACTS to “illustrate the types of research that can be pursued with its unique collection of datasets”.

Bulletin of the American Meteorological Society 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.