First, let me wish all my loyal followers a very happy and healthy new year! So what exactly does 2014 have in store for us on the energy and environment front? Below is a list of things that I am watching, please comment and bring any topics of interest to my attention.
Keystone XL Pipeline – Just today the State Department announced in their report that the Keystone XL Pipeline would have a minimal impact on the environment. This report was greeted with calls for Obama to approve the project by Republicans and even some Democratic lawmakers much to the chagrin of environmentalists. Critics of the report said it did not pay enough attention to the harmful practice of extracting the oil from the tar sands in the first place. The proposed $7B project would carry 830,000 bpd of crude oil from the Western Canadian Sedimentary Basin and the Bakken Shale formation to Steele City, NE before moving on to refineries on the Gulf Coast. Issuance of this report now begins a 30-day comment period for the public and a 90-day comment period for government agencies, as well as puts the heat on President Obama to take action. As recently as June 2013 Obama stated, “Our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution. The net effects of the pipeline’s impact on our climate will be absolutely critical to determining whether this project is allowed to go forward.” Environmentalists have called approval of the pipeline “game over” for the planet.
California Drought – 9% of California is now in a state of “exceptional drought”. While this might not sound like news to anyone who has seen the images of the forest fires in the Bear Republic, this is an extremely concerning issue. In fact, “Thanks to the magic of science (and tree rings), we can now safely say that California hasn’t been this dry since around the time of Columbus, more than 500 years ago. What’s more, much of the state’s development over the last 150 years came during an abnormally wet era, which scientists say could come to a quick end with the help of human-induced climate change.” Lack of rain combined with abnormally low snowpack could leave much of the state virtually dry within 60 – 120 days. If you think this is just a left coast problem, think again – California is responsible for almost 12% of the country’s agriculture.
Emerging markets – If you have been watching the markets lately you have seen a dramatic reaction to perceived threats from emerging markets. I’ll make it quick: Fed removes the free money punchbowl from the party; possible slowdown in China; currency trouble from Brazil, Turkey, South Africa and Argentina. So what does this all mean? Stay tuned and I will keep you posted.
Plus we have Super Bowl XLVIII, the winter Olympics and the World Cup all coming up. What a great year this is going to be.
It has been much too long since my last post, but I think this one is worth the wait. Back in February Mrs. Greenbacks and myself were invited to a wedding in Costa Rica and we gladly attended! Special shout out to Connie and Dave – Congratulations Again!
Aside from the beautiful ceremony and spectacular reception, we got to enjoy much of what Costa Rica had to offer – beaches, rainforest and volcano.
Costa Rica is at the forefront of promoting sustainable practices in their everyday life and as Mrs. Greenbacks pointed out, one of the 5 “Blue Zones” of the world where people regularly live to be over 100 and generally enjoy better health and less incidence of disease than the rest of the world.
Just a few of the common practices that we saw in Costa Rica was composting of all organic materials, low flow faucets and showers as well as automatic shut off switches on the room lights after the key has been removed. A heavy public awareness campaign also goes a long way toward making guest appreciate the natural beauty of the land.
On our hanging bridges canopy tour, our guide explained that Costa Rica was well on its way toward meeting its power needs using renewable sources such as hydro, wind, and geothermal. Almost 95% of CR’s power is produced from renewable sources with hydro accounting for a full 75% of the total. Geothermal ranks second due to the areas 5 active volcanos and wind installations have been steadily increasing in recent years. Distributed solar would make a great addition to CR’s renewable energy portfolio and would help to power regions where grid transmission is simply too costly.
A recent article called Turning Pristine Public Lands Into Solar Farms in Bloomberg Businessweek highlighted the Obama administrations’ policy of opening federal lands maintained by the Bureau of Land Management and the Department of the Interior to renewable energy projects. The executive powers that Obama is using are similar to the ones that the Bush administration used to bypass Congress and push for oil and gas drilling on those same lands in 2001. Using Ken Salazar, the Secretary of the Interior, Obama has approved more than 37 renewable energy projects on federal lands that will power more than 3.8 million homes.
Since taking office, Obama has issued an average of 1,000 fewer drilling leases per year to oil and gas interests. Instead, the administration has green lighted more than 18 other utility-scale solar plant, 7 wind farms, and 9 geothermal facilities.
However, certain projects have angered environmentalist groups such as the Sierra Club and the NRDC who feel that some of the projects would be better sited on 80,000 – 285,000 abandoned mine sites on federal lands instead of pristine desert space near treasured national parks such as Joshua Tree in southern California. A coalition called the Western Lands Project is suing the Dept. of the Interior in federal court hoping to have the projects moved to those less desirable, degraded lands.
While I am generally skeptical of politicians bypassing Congress to achieve a political goal, I do favor building renewable energy plants on federal lands. I also agree with the Western Lands Project that the Interior should look for better locations for these projects that redevelop sites that have already been ruined by mining operations. Reusing depleted lands and brownfield development would be ideal for PV installation because the land does not have to be cleaned up beforehand and solar PV requires very little maintenance and can be seated on top of the land, not disturbing the contamination. The EPA announced a brownfield redevelopment project called Brightfields that aims to achieve exactly that. As with any major project, land use should be a major factor. This is especially true when using public lands for private development. By identifying sustainable sites that promote redevelopment of tarnished lands, the government can achieve a double victory of renewable energy and brownfield remediation.
The below image shows a refurnished open pit mine in Germany that is now one of the world’s largest PV plants at 166MW. This site would have otherwise been left uninhabitable for any purpose.
This week’s Bloomberg Businessweek had an article titled On China’s Electricity Grid, East Needs West, that explained the mega cities of China’s east coast are consuming resources from the coal rich areas in the country’s far western provinces resulting in lengthy transmission lines and growing instability among the minority ethnic groups there.
One of the biggest problems with having cities so far removed from the natural resources that power those cities is transmission. In China, freight railroads and river barges are already overloaded and overcrowded. This led party leaders to push for development of interior regions of the country and build high voltage transmission networks called the West-East Electricity Transfer Project. By 2020 the total capacity of this project is projected to equal 60 Hoover Dams.
The second problem with this large-scale coal driven buildup is the lack of water resources available to produce steam in these plants. Many of these planned coal plants are located in water scarce regions including Xinjiang and Inner Mongolia and has led to tensions with ethic Mongolians and Uighurs who depend on farming and herding for their livelihood. By tapping already stressed aquifers and wetlands, there could be a larger problem looming.
A better idea would be harness China’s production capacity of solar PV cells and adopt a domestic policy of distributed generation. DG is sited near the end user of the electricity and therefore less vulnerable to losses during transmission. PV cells can be placed vertically up the sides of the country’s many skyscrapers eliminating the need to clear land for ground-based systems. Smart building design is another idea that could drastically reduce demand for electricity and save the country from building expensive, inefficient, centralized power plants.
China’s massive infrastructure build out has been nothing short of extraordinary. Now it has the opportunity to leap ahead of other developing nations by committing resources towards building the next generation cities. Distributed generation, microgrids, and smart integrative building design can all help to make this idea a reality.
I read a quick article in Bloomberg Businessweek last week that detailed an unlikely alliance between tar sands producers and environmentalists to put a pollution tax on the dirty, heavy crude coming out of Alberta. Yes, that is correct. Tar sands producers are actually lobbying for a carbon tax or cap-and-trade system that would help to clean up their operations. In British Columbia, a province that enacted a carbon tax, families are paying an average annual premium of $376 and have reduced their per capita emissions 10%. The producer’s biggest fears are to be viewed as “too polluting” by other nations, resulting in no market for their exports. America’s opposition to the Keystone XL pipeline highlights this fear. Unless the tar sands can change their appearance, it seems that the world would be okay without the product. An oil industry spokesman even said that “If your country looks at Canada and says your energy exports are too carbon intensive, then it becomes and economic competitiveness issue.”
Standing in the way of this unlikely alliance and subsequent carbon pricing is the Prime Minister Stephen Harper. Harper has traditionally emphasized business and job creation over environmental issues and is responsible for pulling Canada out of the Kyoto Protocol, the only nation to do so. Failure to embrace cleaner regulations on the tar sands may soon become an environmental and economic problem for The Great White North.
The winds of change are blowing, and nations are figuring out how to monetize carbon. If Canada can enact sensible regulation that appeases both oil producers and environmentalists, then it can be a leader in the carbon markets. If it fights the winds of change, then it risks being left behind by the rest of the world. The simple answer is to put a price on carbon and use the proceeds to invest in clean technology developments.
The ice sheets on Greenland and Antarctica are melting, sea levels are rising, and the rate of ice loss is increasing. These are the conclusions a new peer-reviewed report published in the journal Science came to. The study, authored by 47 experts from 26 institutes, used satellite images to show that the ice sheet melting has contributed to an 11 mm (0.4 in) rise in sea levels. The Greenland ice sheets contributed 2/3 to this rise while Antarctica contributed the remaining 1/3. Also startling were the comments on the Pine Island Glacier, an iceberg the size of New York City that is set to calve off in the upcoming months. While most of this information is probably not news to you, it does offer scientific proof that the planet is warming. We must act now. Please inform yourselves about solutions to climate change – whether through cap-and-trade or a carbon tax – and pressure your elected officials to enact policy measures. The only way to slow the rate of warming is to reduce our emissions through every means possible. Use less energy by making energy-efficient upgrades to your house. Write a letter to your representatives to end subsidies for fossil fuels so renewable technologies can compete on a level field. Or simply turn off electronics when they are not in use. Climate change is a problem that touches all areas of modern society – it is a national security issue, an economic issue, a development issue, and a humanitarian issue. And as this study proves it is getting worse. The paradox is that by the time we see changes that affect us, it may be too late to stop it.
“One degree Celsius rise in temperature is associated with 10% productivity loss in farming. For us, it means losing about four million metric tonnes of food grain, amounting to about US$ 2.5 billion. That is about 2% of our GDP. Adding up the damages to property and other losses, we are faced with a total loss of about 3-4% of GDP. Without these losses, we could have easily secured much higher growth.”
-Sheikh Hasina, Prime Minister of Bangladesh
Most people think the biggest costs associated with climate change are in trying to avoid it by reducing carbon emissions. However, a new study (Climate Vulnerability Monitor 2nd Ed) by DARA concludes that climate change is already costing us $1.2 trillion in foregone prosperity. Yes, that is trillion with a T. This is roughly 1.6% of global GDP. By 2030 the effects of climate change could amount to 3.2% of global GDP with most of the pain being felt by developing nations. Here are some more stats:
• Climate change and a carbon-intensive economy considered a leading global cause of death today, responsible for 5 million deaths each year – 400,000 due to hunger and communicable diseases aggravated by climate change and 4.5 million carbon economy deaths due mainly to air pollution
• Losses for lower-income countries are already extreme: 11% of GDP on average for Least Developed Countries already by 2030
• Major economies are heavily hit: in less than 20 years China will incur the greatest share of all losses at over 1.2 trillion dollars; the US economy will be held back by more 2% of GDP; India, over 5% of its GDP
However, the future doesn’t have to be so doom and gloom. The report concludes that much of these costs can be avoided by emissions reduction investments of just 0.5% of GDP and $150 billion per year in support to mitigate the effects in the countries most vulnerable.