Owner: In Balance URL:http://inbalance.wordpress.com/ Join Date: Wed, 21 Mar 2007 19:23:23 -0500 Rating:0 Site Description: In Balance tracks environmental news in the UK and provide short comment pieces. Innovation in consumer goods and green branding are of particular interest. Site statistics:Click here
Tesco rejects offsets, but the industry continues to look strong 2007-09-28 17:25:45 Tesco today scrapped plans to sell retail offset packages. The supermarket giant’s reason was that the public seems to have become disenchanted with offsets – partly due to scepticism about the quality of non-regulated schemes, and partly because many campaign groups now flatly oppose offsetting on moral grounds. The industry
is portrayed as a bunch of sleazy profiteers, and Tesco does not want that brand risk.
Tesco’s decision does not reflect an industry facing imminent extinction. In fact, it is just getting started. Last month Carbonpositive reported record trading volumes on voluntary emissions credit exchanges. These sales feed the retail and non-regulated wholesale markets and demonstrate that more people are still choosing to buy offsets.
But the main reason why offsets purchased in the West will continue to fund projects across the world is the growth of the regulated market. As new industries are brought into the European Trading Scheme, the growth in the market for cre Read more:Tesco
Personal carbon trading experiment demonstrates how activists work in cap and trade schemes 2007-10-05 02:53:01 Something very interesting, and a bit unexpected, happened at a recent RSA CarbonLimited event in Manchester. Carbon Limited is a project that looks at personal emissions trading schemes, and the event was a one-off demonstration of how such a scheme could work.
Before the exercise (more…)
Read more:Personal
Shaming institutional investors cannot increase the cost of capital for polluting companies 2007-10-03 19:00:51 Banks are favourite targets for campaigners of all types, so it was no surprise to see the Rainforest Action Network launch a campaign to shame Citi and Bank of America for their investments in the coal industry. Here in the UK, RBS in particular gets slated for investments in aviation, oil and gas and other high-emissions industries. (more…)
Read more:capital
Shipping has nothing to fear from the UK’s Climate Bill 2007-10-21 18:35:50 Intertanko, the tankers’ trade association, told the BBC on Friday that it has calculated emissions from shipping to be around double those of aviation (actually, we already knew that – German researchers published the same findings in March this year).
Of course, comparisons in absolute terms are not meaningful, because ships carry a much larger proportion of the world’s trade. To transport a unit of weight a certain distance, freight aeroplanes produce 26 to 36 times the volume of greenhouse gases of ships (according to the Swedish Network for Transport and the Environment - see chart above).
The shipping industry regularly points out its relative efficiency and tends to argue against legislative burdens, such as inclusion in the UK’s emissions targets in the forthcoming Climate
Bill or the EU Emissions Trading Scheme, that it fears would hamper growth.
A forward looking shipping industry should support calls from groups such as the WWF to include shipping in binding emission Read more:Shipping
Soil Association comes to the worst possible decision on air freight 2007-10-25 18:07:25 Over the past few months the Soil Association Standards Board has been considering whether it should withhold its Organic certification from air freighted food on environmental grounds. In Balance argued that it should not, because consumers need to be given clear information about the social and environmental impact of their shopping (rather than have ethical judgements made for them by labelling organisations).
Drawing on a consultation, the Soil Association yesterday came to the conclusion that development trumps greenhouse gas emissions, and that air freighted food can be given the Organic stamp - but only if it is also ‘fairly traded’ (as verified by the Fairtrade Foundation or the Soil Association itself).
The decision
is subjective - it judges that 1. ‘fair trade’ leads to good development (which is by no means clear), and 2. good development is preferable to greenhouse gas emissions. By building these opinions into its Organic criteria, the Soil Associat Read more:comes
Price differential between voluntary offset markets points to fake projects and weak quality regimes 2007-10-30 19:48:04 Offsets are in principle a sensible way to allocate funding for clean development in other parts of the world. The regimes that govern the generation of emissions credits for use in the voluntary market have come under a lot of criticism – including in a recent article in Nature – with good reason. It is a murky, immature market and there are plenty of people making dishonest profits. The clearest indicator of murkiness is the widely varying prices in different markets.
Offsets can by definition be generated anywhere in the world. Credits generated by a renewable energy project in India, for example, could equally be sold in Europe or North America. And you would expect prices to be broadly similar - which they are not.
Voluntary offsets that adhere to the Voluntary Carbon Standard cost around $15 per ton over the counter in the UK. Credits that have passed the Clean Development Mechanism (called CERs), which are valid in the ETS, currently cost $25.50 on the Nordpool exchange. In
John Grant’s new book 2007-11-08 13:10:33 John Grant
, who writes a great blog on green marketing, has just launched a new book. He is giving free copies to bloggers who link to it, and I want one!
Two reasons why you might not want to switch to a green electricity supplier 2007-11-07 08:19:39 Miles Brignall castigated us in Guardian over the weekend for not switch
ing to green electricity
, pointing out that electricity generation is the single biggest source of greenhouse gases yet only 350,000 homes (1.3%) are on a green tariff. There are two reasons why a rational consumer might decide not to switch at the present time:
It is an expensive way to reduce emissions. In Balance calculates the average cost to consumers of avoiding one metric ton of greenhouse gas emissions by switching to a green electricity supplier to be £32. This is quite high. As a crude comparison, Climate Care sells offsets for £7.50 per ton. Most of the things you can do to improve your home’s energy efficiency will cover their costs very quickly.
It might not do anything anyway. Although there are only 1.3% of households on green tariffs, 4.6% of electricity generated in the UK comes (more…)
Czech President continues to question the climate change ‘consensus’ – but what exactly is in it for the conspirators? 2007-11-12 08:54:41 Vaclav Klaus, the CzechPresident
, took the opportunity of the IPCC’s meeting in Valencia today to highlight his view that West European heads of state – particularly Angela Merkel – have an uncritical preoccupation with climate change. He believes that their concern is driven by an ulterior motive, but is not entirely clear about what it is.
A neo-Marxist analysis that has been around for some time provides the clearest ‘ulterior motive’. It argues that environmentalism is an imperialist tool for preventing the global periphery (the poor countries) from industrialising and thereby maintaining structures of production and consumption that favour the global core (the rich countries). Klaus does not think this. As a liberal economist he would agree with Merkel that development in one part of the world benefits everyone.
He sees climate change as propaganda used by Western politicians to distract voters from pressing current issues. “These ‘escapists’ who do not ha Read more:consensus
Blog spruce up 2007-11-11 08:05:12 In Balance has just been spruced up! If you have a Wordpress.com blog and you like the design, I have posted the CSS here (though I warn you it still looks a bit rubbish in IE).
A suggestion for a cap and trade scheme that maximises clean development 2007-11-16 13:51:09 Cap and trade systems that allow participants to submit offsets are designed to allocate resources to the cheapest projects that reduce emissions, across the whole world. Take a look at McKinsey’s marginal costs of reducing greenhouse gas emissions by different methods. If a coal power station’s only option to achieve its cap is retrofitting the plant with clean technology, at a cost per ton of CO2-eqivalent abated of around $30, the plant can instead pay for wind farms to be built at around $15 per ton and pocket the difference.
This sounds like an economically sensible outcome, but it does have some flaws. The following is an idea for a cap-and-trade system that maximises the environmental benefit rather than minimising the cost, and also forces more competitiveness into the offset generation industry (without getting into the debate of whether offsets work or not).
(If you are familiar with the EU ETS, for credit read EUA and for offset read CER.)
A cap is set and credits are d
ASA’s ruling on Npower’s Wembley ad questions all green electricity packages 2007-11-22 05:09:20 The Advertising Standards Authority today upheld a complaint about an Npower advert. The ad claimed that Npower, Wembley’s electricity
supplier, “powers the arch and stadium with renewable energy”. This was considered confusing by the watchdog because what Npower (and every other supplier with a green product) really does is ‘match’ the stadium’s electricity with renewable power supplied to the grid. As Wembley is connected to the grid, it is impossible to control the source of the energy that the stadium actually uses.
RWE Npower must have been surprised by the ruling
, because it has been supplying retail customers on Juice, its green electricity package, on exactly this basis for six years.
The reason that many green electricity products, including Juice, are confusing is not that they match energy through the grid, but that they do not lead to any additional investment in renewables. Npower already purchases sufficient renewable electricity under its Renewables Obligatio Read more:questions
Google: innovation in renewables is a victim of ethical consumers 2007-11-28 18:34:39 There has been a furore over yesterday’s announcement that Google
.org will invest ‘tens of millions’ in renewable R&D in 2008, with an aim of finding a renewable generation technology that is cheaper than coal in ‘years, not decades’. Over the longer term, Google anticipates investing ‘hundreds of millions’ in the profitable technologies that emerge.
Google’s analysis is that generation companies are unwilling to gamble on potentially cheaper renewable technology when there are plenty of customers willing to pay a premium for electricity from existing, more expensive renewable sources.
Essentially, according to Google, ethicalconsumers
’ willingness to pay higher prices is stifling innovation, and also the potential for renewables to become a viable alternative to fossil fuels. Google proposes to bypass this with a huge investment that would not pass standard investment criteria. Hats off.
Read more:victim
CBI climate change report underestimates consumers 2007-11-27 06:36:20 The CBI climate change task force published its report
yesterday. In a change of direction, it promises full commitment to the targets in the Climate Bill and explores how business can be incentivised to make its contribution. Consumers, being responsible for 60% of the UK’s emissions through their lifestyles and shopping, are identified as the drivers of investment in clean technology.
Proposals in the report are based on research into the cost of abating greenhouse gas emissions, which is summarised in a UK version of McKinsey’s cost curve (see diagram below). The research is based on current lifestyles. It asks the question: if we continue behaving as we are now, how can we implement energy efficient technologies so that greenhouse gas emissions are reduced by 60% in 2050?
As most of the technologies are available but not commercially viable, the answer is that we will have to pay up to EUR90 per ton of carbon-dioxide equivalent in 2020, stabilising at around EUR40 in 2030 when Read more:consumers
Big business is serious about most of its Bali Communique - but possibly not all of it 2007-12-02 14:52:05 There have been two significant statements on climate change from big business over the past week: the Confederation of British Industry’s climate change task force published its report, and the Corporate Leaders Group on Climate Change sent a communiqué to the delegates in Bali.
Civil society gave a guarded welcome to both. Greenpeace applauded the content of the communiqué but called it “deeply ironic that among [the CLGCC’s] numbers are companies such as BAA and Eon which are lobbying the UK government for more runways and new coal fired power stations”.
Plane Stupid paid the CLGCC a compliment, calling them a “radical fringe of corporate citizens”, but quoted their CLGCC ‘source’ saying “let’s face it; this is just another attempt by us to look green. It’ll be business as usual in the morning - I guarantee it!”
The communiqué is big business telling politicians to stop dithering and put a clear single international framework in place. This is Read more:serious
Ethical consumerism reports tell us … practically nothing 2007-12-09 19:02:26 Results of the Co-operative Bank's annual survey of ethical spending (pdf) were published last week, showing how much British consumers spent on various categories of ethical products in 2006.
The report shows that we are spending more on green products (such as energy efficiency appliances or furniture made out of green timber - or any product choice that is motivated "at some level' by a concern for the environment), with the spend per household almost trebling from £84 in 2002 to £232 in 2006. What does this tell us about how much greener consumers' lifestyles actually are? Practically nothing, for four reasons:
Choices between different types of product are much more significant that choices between "ethical' or "non-ethical' versions of the same product. A vegetarian meal, for example, will always have a lower carbon footprint than a meal including beef.
The green credentials of the products are suspect. In the US, Terrachoice recently
Why is the Forest Carbon Partnership Facility not linked to the Clean Development Mechanism? 2007-12-15 05:22:54 The World Bank unveiled plans at the Bali conference for a global carbon market in which credits can be generated by protecting or replanting forests. The ForestCarbon
Partnership Facility
will do two things: (i) provide funding to governments of poor countries to help them set up forestry management systems and (ii) allow forestry projects to sell credits to a stand-alone carbon fund.
The World Bank has not made it clear why forestry should be treated as a separate market and not be included in the CleanDevelopment
Mechanism. Reduction units generated by the projects will not be tradable in broader carbon markets such as the EU ETS.
It appears that the World Bank is trying to strike a balance between carbon trading principles - which hold that emissions are a commodity and it makes no difference where they come from - and concerns being voiced by a range of civil society groups that special considerations should be built into forestry projects because people live there.
Or perha Read more:linked
‘Consumption’ carbon footprints are useful but risk double counting 2007-12-15 05:20:04 Measuring carbon footprints is an activity renowned for its double
-counting pitfalls. Dieter Helm's recent report (pdf) into Britain's "consumption' emissions falls into one.
The World Resource Institute's GHG Protocol, the benchmark methodology for calculating corporate emissions, divides footprints into three scopes: 1) direct (for example emissions from a company's vehicle fleet or factories), 2) indirect emissions associated with energy purchased from third parties and 3) all other emissions, such as emissions in the supply chain or from how customers use products.
Installations in the EU ETS only have regulatory exposure to their direct (scope 1) emissions, because any indirect emissions in the other two scopes are direct emissions for another party. Including them would be double counting.
The higher emissions identified in the study are, in effect, Britain's scope 3 emissions. The British government does not directly control them. Some companies measure their scop Read more:Consumption
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Poor countries should use the same carbon price as everyone else 2007-12-23 18:19:35 During Bali, everyone
was telling the US that China's lack of a binding emissions reduction plan is not a reasonable excuse for not having one yourself. It is a fair point. Many environmentalists and Southern politicians also argue that any obligation to reduce emissions rests with the North.
There are four reasons that are given for turning a blind eye to China (and the South): (i) its per-capita emissions are much lower than those of developed countries (true, see chart), (ii) Northern countries have a larger historical responsibility for the emissions already in the atmosphere (true), (iii) many parts of China are very poor and we should not hamper their development (agreed), and (iv) much of China's emissions are associated with its exports to the North, which is "outsourcing' the pollution that results from manufacturing its goods.
From a perspective of developing a global plan for reducing emissions, all but the last of these arguments are True But Irrelevant. Climate sci Read more:price
A politically feasible carbon pricing scheme must take account of the social distribution of its costs 2008-03-10 04:27:00 There are a number of schemes that price greenhouse gas emissions. The EU ETS is the central one, and there are also further European and national schemes covering specific industries or geographical areas.
An intended outcome is that carbon intensive products increase in price more than low-carbon products. People should respond by reducing their consumption of [...] Read more:politically
, distribution
Green tariffs under fire … again 2008-03-07 11:04:18 A clamber of quangoey energy/green groups - Energy Watch, the National Consumer Council, the Renewable Energy Association and the Energy Saving Trust - have written to Defra to suggest that electricity suppliers be required to provide information on the fuel mix used in each of their customers’ tariff. Their issue is that green tariffs are [...] Read more:Green
Energy suppliers provide energy, not social security. Let’s keep it that way. 2008-03-06 14:10:21 The government has been acting threateningly toward the energy suppliers over the past few days. Unless they donate more to consumers in fuel poverty (a household is in ‘fuel poverty’ when it spends more than 10% of its income on energy), the suppliers may face a windfall tax.
There is a feeling that the suppliers have [...] Read more:security
The Times’ blogroll 2008-02-28 14:21:19 In Balance was featured on The Times
’ ‘top 50 eco blogs’ yesterday – thanks Times!
There are lots of good blogs on the list and I’ve added a few to my reading list, left.
Feed-in tariffs: a regressive tax? 2008-02-26 16:48:18 Following the targets for renewable energy included in the recent Climate Change and Energy package, there has been debate about the role feed-in tariffs might play in the UK. Most environmentalists support a feed-in tariff, citing evidence from Europe that such schemes have increased renewable capacity. The government is going to investigate this summer.
Under a [...]
The proviso on a carbon tax - determining the price of carbon - is a show stopper 2008-02-16 12:18:04 We Europeans have settled on cap-and-trade and are about to get serious with it. In the States, it looks fairly certain federal carbon pricing law will be put in place, but whether that is a tax or cap-and-trade is still up in the air. The Congressional Budget Office came out in favour of tax earlier [...] Read more:price
Will dogs survive in cap and trade? 2008-02-12 18:24:01 Most people argue that European and American politicians prefer cap-and-trade over tax because taxes are unpopular with the electorate. There is another benefit to cap-and-trade: by using an cap, the problem of demand elasticity is avoided. A post on Free Exchange today mused whether dogs or SUVs have bigger carbon footprints, and then said that [...] Read more:survive
Invest in ethical funds if you think they will perform well – but don’t think you are saving the earth 2008-02-11 17:25:20 Ethical funds are growing, particularly in the retail sector, and climate change is becoming more important in their criteria. A couple of weeks ago, Standard Life banned airlines from its SRI funds on the basis that they have high emissions.
Really, though, do airlines care? BATA, the UK airline trade association, voiced disappointment and called the [...] Read more:ethical
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EUA traders sillier than we thought 2008-02-07 10:05:43 Comments on In Balance a few weeks ago seem to have overestimated the maturity of the EUA market. Essentially, the article argued that EUAs were following equities because the market was reducing its expectation of economic growth, and therefore emissions, over the next year.
But when the EU released its proposals for Phase 3 of the [...] Read more:traders
, thought
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