The deputy executive director of the International Energy Agency, Richard Jones, has named the UK as the only government currently attempting to cut the high cost of carbon capture and storage technologies, warning the emerging technology could prove “stillborn” without an urgent increase in investment. Speaking to reporters on the sidelines of London’s Clean Energy Ministerial summit on Wednesday, Jones urged governments and industry to accelerate efforts to improve CCS technology, deliver stable regulatory frameworks for the technology, and address safety concerns around transporting and storing captured CO2. BusinessGreen reports that the IEA has downplayed reports that the launch of the 2012 UK energy policy review – now delayed until May due to the death of a close relative of the executive director’s – was postponed yesterday because it contained a negative assessment of the UK’s low carbon strategy. “The UK is doing quite well. Our in-depth review policy… will have a lot of nice things to say about UK policy in this area,” said Jones, who hailed the UK, in particular, as the only government to be investing directly in supporting CCS, through its electricity market reforms and a £1 billion competition.
“CCS is very important because coal continues to be a major source of generation,” Jones said. “In the last decade 50 per cent of the world’s energy needs were met by coal, primarily in the electricity area. …And if we’re going to decarbonise electricity, which is essential if we’re going to achieve the two degrees scenario, we’re going to need to take the carbon out of power generation.” Jones went on to warn that CCS, among other emerging technologies, was at risk of failing to deliver promised CO2 reductions because of lack of investment by governments. “It’s one of the technologies where we really haven’t seen any action lately,” he said. “There’s a lot of money set aside for CCS but there’s been no progress for several years and a number of the projects that were announced have been cancelled,” Jones said. “I don’t know if I could quantify [the risk of it failing] but the longer we go without more investments and more CCS favourable policies, the larger it becomes.”
While in the mood to sound alarms, the IEA is reportedly set to warn world governments that they are falling badly behind on low-carbon energy, putting carbon reduction targets out of reach and pushing the world to the brink of catastrophic climate change. The Guardian reports that the world’s leading independent energy authority will deliver this “stark judgment” later today, at the aforementioned CEM summit, to energy ministers from the world’s biggest economies and emitters. Maria van der Hoeven, executive director of the International Energy Agency, who penned an opinion piece published in the UK paper today, warns that on current form, the world is on track for warming of 6°C by the end of the century – a level scientists say would wipe out agriculture in many areas, render more parts of the globe uninhabitable, and raise sea levels, causing mass migration.
“The world’s energy system is being pushed to breaking point,” van der Hoeven writes. “Energy-related CO2 emissions are at historic highs, and under current policies, we estimate that energy use and CO2 emissions would increase by a third by 2020, and almost double by 2050,” she says. “Many clean energy technologies are available but they are not being deployed quickly enough to avert potentially disastrous consequences.” In its report, Tracking Clean Energy Progress, the IEA ranked progress on 11 key low-carbon indicators, including renewables, nuclear energy and carbon capture and storage, and found the world was on track to meet just one of these targets. To meet the carbon cuts scientists calculate are needed by 2020, the IEA says the world needs to generate 28 per cent of its electricity from renewable sources and 47 per cent by 2035. Currently, renewables make up just 16 per cent of global electricity supply.
British racing green
Also in the UK, Prime Minister David Cameron has announced a series of new renewable energy and cleantech contracts worth £350 million and 800 jobs. Cameron, who is due to speak at the Clean Energy Ministerial summit in London later today, is expected to say that renewable energy companies have invested £4.7 billion ($US7.6 billion) in the UK in the past year, supporting 15,000 jobs as the economy tumbled back into recession. “There are huge challenges facing governments across the world today, and one of the most important of all is how we meet our growing energy demands,” Cameron will say, according to a statement released by his office. “We urgently need a more diverse, cleaner mix of energy sources that will give us security without causing irreparable damage to the planet.” Bloomberg reports that the remarks, to be delivered to the gathering of ministers from 23 nations, are aimed at bolstering the UK government’s economic record after first-quarter figures indicated the nation is suffering its first double-dip recession since the 1970s. Cameron took office in 2010 promising to make his the “greenest” administration ever.
And accounting giant Ernst & Young has another suggestion for how the UK can bolster its economy, releasing a report on Tuesday saying that Britain could inject £13 billion into its economy and create up to 10,000 jobs by upgrading its power distribution network with smart grid technology. Reuters reports that Bill Easton, utilities director at Ernst & Young, said that a transition to smart grids would require an investment of £23 billion up to 2050, a significantly smaller amount than taking a business-as-usual approach to supplying power using conventional technology, which Ernst & Young estimates would cost the UK economy £42 billion. “In addition to the direct economic benefits, we can also expect to see wider economic benefits to the UK, providing a welcome boost to growth, jobs and exports,” Easton said. “These could include close to 10,000 new jobs and exports in excess of 5 billion (pounds),” he said, adding “overall, the report paints a compelling case in favour of smart grids.” The report stressed, however, that the adoption of smart grid technology was likely to be slow, with little investment before 2023.
Norway eyes carbon tax hike for fossils
Norway has proposed to nearly double the carbon tax on the country’s vast oil and gas sector, in a move to encourage offshore firms to rely more heavily on onshore, primarily green energy sources. Reuters reportsthat the move, proposed in a government white paper, would up the tax on carbon dioxide emissions from fossil fuel energy by 200 crowns per tonne. Norway, the world’s second-largest natural gas exporter, uses very little of its own gas, relying instead on hydroelectric power to meet around 99 per cent of its power needs. However, offshore energy companies often use natural gas or oil for power generation instead of building transmission infrastructure to the mainland. Norway’s CO2 tax, first introduced in 1991, is estimated to have generated about $400 million worth of revenues in 2011. For natural gas, the current rate stands at 205 crowns per tonne. “We have one of the world’s most ambitious climate policy goals and now we will intensify efforts,” Prime Minister Jens Stoltenberg said on Wednesday. The government is yet to propose a starting date for the tax increase.
Germany eyes wind boost
After a week that saw Siemens cut its annual profit forecast for the third time in five years – after racking up €481 million in extra costs this year from delays in hooking up marine wind farms to the grid – the German government has flagged plans to expand a €5 billion ($US6.6 billion) program by state-owned KfW Group to boost lending to the offshore wind industry and increase support for mid-sized grid operators. The nation’s environment minister, Norbert Roettgen, said today that the aim of the plan was “to strengthen the capital market, possibly with the help of the KfW,” to combat delays in connecting turbines to the power grid, because the grid companies did not have the scale to finance the multi-billion-dollar projects alone. Bloomberg reports that the talks between the government and the bank could result in opening the fund for grid projects by boosting its value or using the existing amount. “While no decision has been made, nothing is being ruled out,” said KfW spokesman, Wolfram Schweickhardt.
Roettgen said the government was considering “possibly expanding the €5 billion program,” but didn’t specify how this would be done. The government will make a decision this summer, says Reuters. Germany has plans to install 25GW of offshore wind turbines in its waters by 2030, up from about 0.2GW at the end of last year. The grid delays have been a setback for the country’s shift to a nuclear-free, 80 per cent renewables energy mix by 2050. Like Siemens, EON AG and RWE – the country’s biggest utilities – have also been adversely affected by obstacles to offhsore wind development, and have threatened to halt investment in wind projects until these obstacles are removed.