Emissions Trading

Guest Post – Kevin Hearle – NZ’s Kyoto commitment (a farce) and here is why.

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The New Zealand Kyoto commitment as measured by the Government fell to Zero in April of 2013 the actual commitment in Millions of Units was 29.1M Units but because the value of these Units is linked to the price in Euros of a CER on the European Exchange and that fell to €0.01 effectively zero our units are deemed to be worth less than a CER (though why a unit of carbon is worth less in NZ than it is in Europe is beyond me) this made our 29.1 million credit worth nothing.

Let’s consider that we can actually measure our commitment with any certainty for the moment.

The price of carbon has fallen from around € 12.00 in 2008 to effectively zero €0.01 in April 2013. This fall is due to the manipulation of the market by the EU in allowing the market to be flooded with CER’s  and now by the complete loss of credibility of the UN IPCC and the Catastrophic Anthropogenic  Global Warming  scenario painted by that organisation.  The IPCC’s 5th Assessment report has been bagged by scientists and the press alike.  James Delingpole’s article in the Telegraph  headlined “The climate alarmists have lost the debate: it’s time we stopped indulging their poisonous fantasy” sums it up.

Delingpole quotes  IPCC lead author Dr Richard Lindzen as saying  the IPCC has  “sunk to a level of hilarious incoherence.” Nigel Lawson has called it “not science but mumbo jumbo”. The Global Warming Policy Foundation’s Dr David Whitehouse has described the IPCC’s panel as “evasive and inaccurate” in the way it tried dodge the key issue of the 15-year (at least) pause in global warming; Donna Laframboise notes that it is either riddled with errors or horribly politically manipulated – or both; Paul Matthews has found a very silly graph; Steve McIntyre has exposed how the IPCC appears deliberately to have tried to obfuscate the unhelpful discrepancy between its models and the real world data; and at Bishop Hill the excellent Katabasis has unearthed another gem: that, in jarring contrast to the alarmist message being put out at IPCC press conferences and in the Summary For Policymakers, the body of the report tells a different story – that almost all the scary scenarios we’ve been warned about these last two decades (from permafrost melt to ice sheet collapse) are now  graded by scientists to somewhere between “low confidence” to “exceptionally unlikely;” .   Read more »

Sledge of the Day

Tony Abbott gives it to Kevin Rudd, hard.

Mr Abbott said Mr Rudd hadn’t really terminated the carbon tax and had instead admitted it was hurting business and families.

‘He’s not the terminator, he’s the exaggerator,’ he said.

‘The only way to get rid of the carbon tax is to get rid of the government.’   Read more »

Tony Abbott talks about the ETS, are you listening John?

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Tony Abbott comes good and slams Kevin Rudd’s conversion to an ETS.

The Government has confirmed it wants to move from a fixed carbon price of $24.15 a tonne to a floating price of about $6 by July 2014, a year earlier than planned.

It is a political fix designed to neutralise the poisonous carbon tax issue, but it has created a new budget problem and sparked a war of words.

Today Mr Abbott was asked to explain why he objects to the Government’s scheme, when the Coalition has previously backed the idea of a market-led solution to greenhouse gas emissions.

“This is not a true market. Just ask yourself what an emissions trading scheme is all about,” he told reporters.

“It’s a so-called market in the non-delivery of an invisible substance to no-one.  Read more »

Rudd backs away from carbon tax

Kevin Rudd has seen the political reality and is moving to change Australia’s carbon tax into an ETS. It isn’t a complete back down but it is a start.

KEVIN Rudd will announce plans to scrap the carbon tax within days as he clears the decks for an election.

The decision could slash electricity bills by up to $150 a year for families spending $2000 annually, assuming a floating price for carbon emissions as low as $6 per tonne.

Federal cabinet has agreed to fast-track the planned introduction of an emissions trading scheme to July 1, 2014.

In an attempt to neutralise Tony Abbott’s anti-carbon tax crusade, the Prime Minister will announce the plan to “ease cost of living pressures for families”.

Australia had previously planned to move from the current fixed-price carbon tax on the biggest polluters – much of which is passed on to consumers through higher utility prices – to an emissions trading scheme, where the price is determined by the market, by July 2015.

The planned shift from a fixed to a floating price threatens to blow a massive hole in the federal budget, costing billions of dollars a year.

The government will claim the shift is “revenue neutral”, with tough spending cuts to offset reduced revenue.   Read more »

Ratbag Greenies costing poms more for power

Know one thing, if you let the green taliban have any say in anything it will cost you much, much more in the long run. Their solutions for everything require huge subsidies, reductions in service and/or both, and certainly increased costs for everyone.

Electricity prices in Britain may be almost double those in Germany within three years due largely to the impact of a new tax aimed at supporting renewable power generation, a report by bank Credit Suisse has claimed.

The bank’s analysis showed wholesale prices, which form the backbone of energy bills, would top those in Germany by 85pc in 2016-17 and would be higher in general for the next seven to 10 years.

The bank blamed the roughly fivefold rise in the government’s new tax on carbon-dioxide emitting power generation over the next seven years, while also pointing to Britain’s lack of infrastructure to import power from the European mainland.

Prices in the two countries had tracked one another for years, but they diverged last year as Germany spurred a boom in renewable energy generation by pouring billions into subsidising the green sector.  Read more »

Maori want to tax whitey for ETS

When will it ever end?

Maori wanting to tax whitey for every perceived grievance they can dream up:

 The peak Maori body advising the government on climate change issues says the weak provisions intended for the Emissions Trading Scheme are robbing Maori of hundreds of millions of dollars by depressing the value of New Zealand carbon credits attached to Maori forestry holdings.

The comments coincide with the value of a New Zealand Unit (NZU) dropping back below $3, a historic low point, for the second time in a month, as a glut of European carbon credits combines with New Zealand’s policy to allow local greenhouse gas emissions to be offset by unlimited foreign-sourced carbon credits.

Of course the solution will be to thrown millions at them in “compensation”.  And they will end up selling them to rich Americans or Chinese anyway.

When the Treaty of Waitangi was signed not even a taniwha could have predicted a trade to develop in thin air.

 

 

Chart of the Day

Carbon markets are rooted. Is anyone surprised at this graph?

WHAT would you say about a market that has helped reduce carbon emissions by a billion tonnes in seven years, attracted $215 billion of green investments to developing countries (more than any private environmental fund) and cut the cost of climate-change mitigation by $3.6 billion? The answer, to judge by a United Nations panel looking into the workings of the Clean Development Mechanism (CDM) is: you’d say it is a shambles.

The CDM was set up under the Kyoto protocol to get developing countries to do their bit to reduce carbon emissions. The mechanism allows projects that reduce greenhouse-gas emissions in poor countries to earn a carbon credit (a “certified emission reduction”, or CER) for each tonne of carbon dioxide avoided. The credits can be sold to firms in rich countries which are obliged under Kyoto to cut their emissions. The idea was to encourage carbon saving where it was cheapest (ie, in developing countries), increasing efficiency.

The trouble is that the supply of credits has far outstripped demand. The one-billionth CER was issued on September 7th. But the largest greenhouse-gas emitters either did not ratify the Kyoto protocol (America) or were not obliged by it to cut emissions (China and India). That has left Europe as the main source of demand for credits, and the CDM has become a sort of annex to Europe’s cap-and-trade scheme, the Emissions Trading System. But the euro crisis has reduced industrial activity (cutting pollution) and European firms were anyway given overly generous carbon quotas under the cap-and-trade scheme. So carbon prices have collapsed, falling from $20 a tonne in August 2008 to below $5 now (see chart).

Global carbon trading scheme dead

While the argument over Global Warming still has some life in it, there is no doubt at all about the cures that Green economists have devised.

From ethanol production destroying rainforests, to inefficient windmills blighting the landscape and the solar industry going bankrupt, they are all utter failures.

Now the biggest rort of all, the mad carbon trading scam, is on the brink of collapse.

And the news doesn’t come from sceptic blogs – it is reported by The Guardian, the left-wing UK newspaper that is one of the most passionate advocates of the watermelon cause.

The world’s only global system of carbon trading, designed to give poor countries access to new green technologies, has “essentially collapsed”, jeopardising future flows of finance to the developing world.

Billions of dollars have been raised in the past seven years through theUnited Nations‘ system to set up greenhouse gas-cutting projects, such as windfarms and solar panels, in poor nations. But the failure of governments to provide firm guarantees to continue with the system beyond this year has raised serious concerns over whether it can survive.

A panel convened by the UN reported on Monday at a meeting in Bangkok that the system, known as the clean development mechanism(CDM), was in dire need of rescue. The panel warned that allowing the CDM to collapse would make it harder in future to raise finance to help developing countries cut carbon.

Joan MacNaughton, a former top UK civil servant and vice chair of the high level panel, told the Guardian: “The carbon market is profoundly weak, and the CDM has essentially collapsed. It’s extremely worrying that governments are not taking this seriously.”

Gas is greener than Wind

ᔥ The Telegraph

This study is going to put the shits up the Greens…it appears that gas is greener than wind:

Building gas-fired power plants instead of more offshore wind farms could actually lead to greater carbon savings at a lower cost, a leading think-tank has claimed.

In a report today, Policy Exchange argued that the government should scrap 4GW of its planned 13GW target for offshore wind generation by 2020.

By building cheaper gas generation instead it could save ÂŁ700-ÂŁ900m a year in costs that would have been passed onto billpayers, it calculated.

These savings could be redeployed by insulating hundreds of thousands more homes and doubling public funding for research and development in key low-carbon technologies, it said.

That would still leave enough money to “buy and retire sufficient carbon permits each year to reduce emissions by six times as much as the 4GW of offshore wind”.

It argued: “To achieve maximum overall emissions reduction and low carbon innovation, the electricity market needs to be allowed to invest in gas as a transition fuel, subject to a long-term EU emissions cap.”

Even if gas-fired power plants had to be retired early because of the EU’s emissions cap, it would still be a “far cheaper” interim solution than building offshore wind while the costs remain so high, it said.

Fracking to save the Planet

ᔥ The American Interest

This news isn’t going make the Greens very happy:

But perhaps the greens should put down their megaphones and protest signs for a minute to take another look at the data. A new report discussed in the FT claims that American shale gas production has actually reduced carbon emissions by 450 million tons over the past five years, during which fracking came into widespread use. As the report mentions, gas—mostly obtained via fracking—has grown in usage by 38 percent over the past year alone, while much dirtier coal has fallen by nearly 20 percent over the same time period. The correlation between the rise of fracking and a fall in carbon output is not a coincidence. While greens have spent years chasing a global green unicorn, America has been moving towards reducing its carbon footprint on its own, and fracking has been the centerpiece of this change.

In fact, America’s drop in carbon emissions is greater than that of any other country in the survey. Greens have often praised Europe and Australia for their foresight in adopting forward-thinking carbon-trading schemes, while chastising America for its reluctance to do the same. Yet the numbers are out, and America has actually performed better than its carbon-trading peers. From an empirical standpoint, fracking has a much better track record at reducing emissions than the current green dream.