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SPRD Media Monitoring 8/7/17
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Will China and India Lead on Global Climate Action and Environmental Protection?
Aug 7, 2017 | Triple Pundit
By Mark Robinson
With the U.S. withdrawn from the Paris Agreement, China and India have an opportunity to fill the gap and become global leaders on renewable energy. -
How Markets Beat Other Policies at Tackling the Energy-Climate Change Problem
Aug 3, 2017 | Forbes
By Jeff McMahon
Jeff McMahon discusses the important role of the market in the development of energy technology and fighting climate change. McMahon covers green tech, energy, and environment topics for Forbes and is an important journalist to follow. -
What If We Gave the World Solar Mini-Grids, and the World Didn't Want Them
Aug 3, 2017 | Forbes
By Jeff McMahon
Jeff McMahon discusses the possibility of developing countries jumping directly to mini-grids, and bypassing the current model of a sprawling electric grid, which might pose some social challenges. McMahon covers green tech, energy, and environment topics for Forbes and is an important journalist to follow. -
Renewable Energy Hits Global Tipping Point
Aug 2, 2017 | Forbes
By Morgan Stanley Voice
The rising trend of renewable energy has reached an important tipping point, and green energy is now more affordable than fossil fuels in many locations. -
The East is Turning Green
Jul 31, 2017 | Financial Times
By Helen Wong
As the most prominent "up and coming" countries, China and India are at the forefront of environmental development. Their rapidly growing populations and economies, and their global position as countries who are most affected by climate change, enable them to fill this niche.
Global News
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Will China and India Lead on Global Climate Action and Environmental Protection?
Aug 7, 2017 | Triple Pundit
By Mark Robinson
Shifting global leadership on climate action
June 1, 2017, marked a decisive shift in global leadership on climate change following President Trump’s decision to withdraw from the Paris Agreement, signed by all but two countries in 2015. This decision has wider ramifications for global politics and for national commitments to keep global warming to less than 2 degrees Celsius.
China seeks to assume the political mantle for global climate leadership, backed by financial resources and massive investments in renewable sources of energy, especially solar power. It perceives huge growth potential in global solar and wind markets. India has ambitious national commitments on solar energy and curbing fossil fuel use, but with fewer ambitions on the global political stage.
Projected declines in coal use in China and India are likely to reduce growth in global carbon emissions by roughly two to three billion tons by 2030 compared to forecasts made a year back. Coal-fired power stations are increasingly uneconomical compared to solar power. In May, India abandoned planned investments in coal-fired power stations with a combined capacity of 14GW, equivalent to the whole of the UK. Both countries are likely to achieve national climate emissions reductions ahead of target, potentially serving as a significant contributor to reduced net global emissions.
Market forces favoring solar and wind power threaten to leave the United States behind, with the continued decline of coal, whereas China wants to benefit from new energy markets, and plans to invest US$360 billion by 2020. This would take the proportion of renewables in domestic energy to 50 percent by then. India expects 40 percent of its energy needs to be met by renewables by 2030. Meanwhile, the global renewable energy market is expected to reach US$13 trillion over this period, spurred by national commitments under the Paris Agreement.
In pursuing these ambitious climate and energy policies India and China have an opportunity to lend visible support to the German G20 Action Plan on Climate and Energy Growth.
Lagging responses on environmental policies
But progress on climate action is not yet matched by comparable leadership on domestic environmental policies; deep problems of air, soil and water pollution with excessive use of pesticides and fertilizers are causing chronic health impacts in both China and India. Public pressure is building and both governments are looking to the experience of the United States and other countries in successfully addressing such problems.
Over the past five decades, the United States has excelled in tacking environmental problems through sustained bipartisan policy responses. But this is now under threat. The US withdrawal from the Paris Agreement marks the culmination of a series of domestic policy reversals under the Trump administration on climate and environment. These include overturning the Clean Power Plan (designed to reduce CO2 emissions from electrical power production), protection of air and water, and massive budget and staffing reductions for the Environmental Protection Agency (EPA). It is therefore ironic that U.S. global leadership on environmental protection is now looked at for inspiration to inform domestic environmental policy in China.
Lessons from the United States
One important lesson from the U.S. experience is the power of public pressure and the media to galvanize government action. Publication of Rachel Carson’s Silent Spring in 1962 drew public attention to dangers of the health and environmental risks of unregulated pesticide use. This spurred massive media coverage which in turn spurred the creation of the EPA under President Nixon in 1970.
A similar tipping point is possible in China. Documentary film maker Chai Jing released Under the Dome in 2015, which was openly critical of failures to tackle air and water pollution. It received several hundred million views before it was taken down four days later. Public discontent is growing and the Chinese government recognizes the urgent need to respond.
Transparency and openness to the fore
There are important lessons for China from the U.S. experience, with air and water pollution rising to top of domestic policy agenda, fueled by public protest and negative media coverage. Government is recalcitrant on the release of public information on air, water and soil pollution. Prompted by monitoring by the US Embassy in Beijing, China now permits the public release of air pollution data in a growing number of cities and outside thousands of factories.
China and India are both signed up to Principle 10 of the UNEP Bali Guidelines which was adopted in 1992 as a part of the Rio Declaration, which states that: “Environmental issues are best handled with participation of all concerned citizens, at the relevant level. At the national level, each individual shall have appropriate access to information concerning the environment that is held by public authorities, including information on hazardous materials and activities in their communities, and the opportunity to participate in decision-making processes. States shall facilitate and encourage public awareness and participation by making information widely available. Effective access to judicial and administrative proceedings, including redress and remedy, shall be provided.
WRI’s 2015 Environmental Democracy Index shows that China performs reasonably well on the right to information and public participation in decision making, but not as strongly on the rights to redress and remedy, as compared to India, which has the legal infrastructure in place for this purpose. China now acknowledges the need to empower citizens to demand information and hold officials accountable for lack of action, through the law courts and other measures. Since the introduction of the new Environmental Protection Law in 2015, China’s courts have accepted 189 public interest environmental cases, mostly brought by environmental NGOs. The Ministry of Environmental Protection, which is responsible for implementation of the new law, has intensified local inspections of heavily-polluting industries and is now actively collecting public complaints on environmental issues.
As noted by the Economist, “Openness would enable the Chinese to understand the risks they face, and to hold officials to account for failing to stop polluters from poisoning them”. Global leadership on climate action and environmental governance means living up to the spirit and practice of citizen engagement and regulatory enforcement, and not just capitalizing on the potential economic returns.
Mark Robinson is Global Director, Governance, at the World Resources Institute in Washington, D.C., a leading global research organization working on sustainable development with offices in seven countries. Mark previously held senior leadership positions at the Institute of Development Studies, The Ford Foundation, and the Department for International Development (DFID).
http://www.triplepundit.com/2017/08/will-china-india-lead-global-climate-action-environmental-protection/
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How Markets Beat Other Policies at Tackling the Energy-Climate Change Problem
Aug 3, 2017 | Forbes
By Jeff McMahon
Markets have proven more efficient than regulations and rebates at tackling the energy and climate challenge, a leading environmental economist argued recently in Aspen.
The most popular policies in the United States—rebates for appliance upgrades, energy efficiency and efficient vehicles—may cost society more than the problems they set out to solve, while markets produce the same results cheaply, said Michael Greenstone, the Milton Friedman Professor of Economics at the University of Chicago.
"Somehow we prefer to use these other policies when markets would be less expensive," Greenstone said June 30 at the Aspen Ideas Festival. "Our best hope for confronting this challenge is going to be by turning to markets."
Three Legs
Greenstone is the director of the Becker-Friedman Institute for Research in Economics, director of the Energy Policy Institute of Chicago, and he served as the chief economist of the White House Council of Economic Advisors from 2009-10. He sees the energy challenge as a stool with three legs, all of which should be considered in a successful policy:
Energy access is needed to pull billions of people out of poverty in the developing world. "We basically don't have any historical examples of countries achieving high levels of living standards without lots and lots and energy consumption," he said.
Countries traditionally provide energy access by burning fossil fuels, which produces pollution that's harmful to health.
The same fossil fuels that power economic growth release carbon dioxide, increasing the odds of disruptive climate change.
"The global energy challenge is one of the most urgent problems society faces," Greenstone said. "There are billions of people who live at incredibly low levels of income…. That translates into disease and sickness and shorter lives. Access to energy is critical for those people, and the countries where those people live are going to be rightly focused on finding inexpensive ways to get those people access to energy. A lot of that’s going to come from fossil fuels, and those fossil fuels come with risks to our health and risks to climate change, in terms of increasing the odds of disruptive climate change."
Developed World
In the developed world, popular policies often have a high cost for each ton of carbon dioxide emissions they prevent. For example, Greenstone said, appliance rebates cost $602 per ton of CO2 prevented, rebates for reduced electricity cost $468, rebates for efficient vehicles cost $313, and rebates for home weatherization cost $207.
At the same time, carbon markets in California, New England and Europe cost less than $15 for each ton of carbon pollution they prevent.
The U.S. has estimated the social cost of carbon—the cost of the negative impacts of carbon pollution—at $42 per ton, so the rebates spend hundreds of dollars to solve a $42 problem, while the markets spend much less.
That is if the $42 social cost of carbon is correct. Greenstone led the effort to develop that figure during the Obama Administration, and he is now leading a new effort to improve the figure using more detailed data, specific to 25,000 regions in the world, measuring climate impacts in each region on mortality, labor, energy demand, crop yields, migration and crime.
"You can see that people's ability to work on very hot days appears to decline. Energy demand goes way up, which is not surprising, as people are using cooling techniques. Crop yields go way down. There even appear to be increases in migration, which is costly. And somewhat speculatively, there's increases in crime as well. Our aim is to add all that up and produce a new number."
The new number may make the rebates look less expensive, but if so, it will also make markets look even cheaper.
Developing World
Greenstone challenged the popular idea that solar mini-grids can provide energy access in the developing world, because people there may not want solar mini-grids. And he offered other examples of wayward policies in the developing world:
• To improve energy access, the Chinese government offered people who live north of the Hua River free heat during winter months. The heat was produced by burning coal, and as a result, those people enjoyed warmer winters but suffered from air pollution that reduced their life expectancy by three years. The policy cost China 1.5 billion life-years, Greenstone calculated.
"All of the reductions in life expectancy are coming from cardiorespiratory causes of death that are plausibly related to air pollution," he said.
• In the Indian state of Gujarat, the government enacted a regulation requiring power plants to hire inspectors to report on pollution emissions. The regulation created a labor market for pollution inspectors, but because they were hired and paid by the power plants, the market's incentives discouraged them from reporting violations.
"Basically everyone was in compliance," Greenstone said, and the government regulator doubted the results he received from the inspectors.
Greenstone ran an experiment in Gujarat in which some plants continued on this scheme, to serve as a control group, while others were prohibited from hiring and paying inspectors. Instead, the government hired the inspectors, who were paid from a central pool that plants paid into. In this second group, the inspectors were offered cash bonuses if their reports stood up to verification.
The second group reported many more plants out of compliance.
"Just by changing the operation of this market, you're able to get an incredibly different result," Greenstone said. "In particular, the treatment caused the auditors to become more truthful."
The power plants reacted to the rise in accurate reporting by reducing pollution emissions 28 percent.
"So this kind of tweak in a market really produced an opportunity," Greenstone said. "The regulator adopted this reform, and this is now how the auditing is done in Gujarat. The idea is that you can use markets to achieve whatever your goal is with respect to pollution."
Climate Change
Climate change continues to worsen because the social costs of greenhouse gas pollution are not borne by the markets in which those fuels are sold. Instead, they turn up in health and home insurance rates, in mortality rates, in the costs of lost labor and crime across the economy.
Greenstone did not propose a particular market solution during his Aspen lecture, though he has advocated a carbon tax in the past. Greg Hamra, an audience member from Miami, asked him what he thought of the Republican proposal led by former Reagan and Bush Administration officials James A. Baker III and George Schulz for a carbon dividend.
"The plan is to put actually a $40 tax on carbon emissions and then the government, instead of taking it in and doing whatever it is governments do with money, immediately refunds it to taxpayers with checks," Greenstone said.
"I think there's a great deal of appeal to that. It uses markets to solve what is a really sticky and thorny problem. And another feature of that plan, which I think from an economic-efficiency standpoint has a lot of appeal, is it would get rid of the regulations that are mandating particular ways to get carbon reductions, which led to a lot of those expensive [rebate policies] I pointed to at the beginning of my talk."
https://www.forbes.com/sites/jeffmcmahon/2017/08/03/markets-offer-best-solution-to-the-energy-climate-problem-economist-says/#b5fc5bd58d06
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What If We Gave the World Solar Mini-Grids, and the World Didn't Want Them
Aug 3, 2017 | Forbes
By Jeff McMahon
It's a popular idea in the energy and climate-change crowd: developing countries can leapfrog the kind of sprawling electrical grid we have in the United States, with its centralized power plants, and go directly to a future in which homes and businesses generate clean electricity from the sun and share it over mini-grids.
Many developing countries leapfrogged the old wired telephone system, after all, and went straight to cellular phones.
But some researchers are discovering that may not be what the developing world wants.
"What we learned over time is that people don’t like the solar panels very much," University of Chicago economist Michael Greenstone said at the Aspen Ideas Festival. "The sun doesn’t shine all the time. The batteries that are associated with them catch fire and all kinds of nasty things."
Greenstone has been involved for several years with research into demand for solar minigrids in Bihar, India, an impoverished state of 100 million people, where only 5 percent of homes had access to grid electricity. Rural homes rely on cooking stoves and kerosene lamps, which count lung disease among their dangers.
Southwest of Bihar, the state of Maharashtra supplied rural villagers with solar equipment in 2012, but many of those arrays have fallen into disrepair, Bloomberg reported earlier this year. Would a program in Bihar fare better if villagers were asked to pay for access to the solar equipment?
Greenstone's team, which included researchers from Yale, Harvard and the London School of Economics, set out to find a price point at which people were willing to pay for the solar equipment. If the government subsidized solar mini-grads to bring them down to that price, they wanted to know, would people buy in?
"Almost all the demand for this evaporated," Greenstone said. "At the prices that reflect the cost of supplying, there's almost no demand, and if you subsidize down to the price where most businesses could enter, you’re down to about nine percent."
So the researchers asked people why they weren't interested:
"The answer is, 'We want real electricity. We want the grid,'" Greenstone said. "That raises the question of how are we going to bring the grid to developing countries and how are they going to develop it for themselves."
https://www.forbes.com/sites/jeffmcmahon/2017/08/03/what-if-we-gave-the-world-solar-mini-grids-and-the-world-didnt-want-them/#4f2f90fa5db4
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Renewable Energy Hits Global Tipping Point
Aug 2, 2017 | Forbes
By Morgan Stanley Voice
The politics surrounding climate change and calls for greener sources of energy remain contentious. But beyond global accords and national policies, market forces are now making clean, renewable power a competitive lower-cost reality.
“Numerous key markets have reached an inflection point where renewables will have become the cheapest form of new power generation by 2020, a dynamic we see spreading to nearly every country we cover,” says Stephen Byrd, who leads coverage of North American power and utilities and clean energy industries, and has been watching developments in this sector for the past several decades.
Thanks to years of heavy investment in new and more efficient technology and manufacturing capacities at greater scale and less cost, wind and solar power are winning over perhaps the most significant constituent in the global energy market: the large-scale utilities that generate, store and distribute power across vast energy grids to industrial, business and residential consumers. Globally, the rise of renewables is set have a dramatic effect on utilities, presenting investors and consumers with unique opportunities—as well as some potential pitfalls.
And thanks to utilities’ rising adoption of renewable sources of energy, the U.S. now appears to be on track to meet its original Paris accord carbon-reduction targets, even if the country pulls out of the pact, says Sustainability Analyst Eva Zlotnicka.
New Tech & Cheaper Supply
How did this happen? First, solar panel manufacturers have spent the past few years in a race to ramp up production, finding cheaper and more efficient ways to make panels in the process. The result: An oversupply of solar panels that pushed down panel prices by 30% in 2016, with another 20% decline expected this year, according to the Morgan Stanley report. With panels often accounting for up to 40% of utilities’ cost when building large-scale solar energy plants, falling prices mean more affordable solar development.
When it comes to wind production, the savings are all about physics. Manufacturers have been increasing the length of wind turbine blades over the past several years, while engineers are adding more height to wind turbine towers. Both factors have resulted in big changes to power production and efficiency, ultimately reducing the cost of wind energy, Byrd notes. For instance, in central regions of the U.S., wind is now the least expensive type of power, at about $30 per megawatt hour, compared to $40-$60/MWh for natural-gas-fired power generation, the next cheapest form of fuel.
This seismic shift toward renewable power will have significant effects on the performance and profit of the global power industry. “Utilities with deregulated power plants, which must compete to sell power, generally will experience greater upside if they are leaders in renewable energy development, and additional downside if they own large fleets of fossil and nuclear power plants in competitive markets with cheap renewable energy,” Byrd says.
Global Jolt
Globally, India's energy sector could feel the greatest impact. Solar power there recently reached a tipping point, becoming more affordable than coal. While this is significant news for a country that is the world's third-largest source of carbon emissions, it may disrupt India's coal power generators. The latter have played a big role in doubling the country's coal capacity over the past few years. “Renewables have achieved grid parity, and the first stage of disruption in the market is underway. Grid parity for storage and long-term power contracts’ expiry would be the second and third stages of disruption,” says Girish Achhipalia, who covers Indian utilities, as well as industrial and agricultural companies.
In the U.S., meanwhile, affordable renewables will dramatically change the carbon makeup of many utilities, and could ensure that the country exceeds its original targets to reduce greenhouse-gas emissions under the Paris climate accord agreement—regardless of the current political winds, says Zlotnicka.
A micro example of this comes out of Texas. While the state has opposed the Environmental Protection Agency's Clean Power Plan, it actually leads the country in installed wind capacity—because for Texas utilities, wind is simply good business.
Internationally, regions such as Mexico, which is riding a second mover advantage with solar power development, also stand to benefit from the shift to renewables. The clean power economics will have less of an effect on European utilities, but that is because many of them have already transitioned to renewable energy sources.
And the Winners Are …
It may be too soon to call this a win for the planet, but consumers of all stripes, as well as forward-looking utilities and savvy shareholders, stand to reap the rewards of this renewables revolution. Low-cost renewables would reduce consumer power bills, which in turn could fuel more consumer spending and economic growth, and lead to more investment in renewables—or what Morgan Stanley analysts consider to be a “virtuous cycle.”
In addition, utilities' focus on replacing carbon fuels with clean power also typically improves their regulatory environment, which means a lower-risk operating environment that can bode well for bottom-line results, spurring more investment in projects that modernize the power grid, Zlotnicka says.
On the flip side, utilities that don't capitalize on the affordability of renewables and stick with fossil fuels could experience lower profitability. “We see this trend, which has been evident in the U.S. and Europe, spreading to India, China, and South America—in many cases with much more severe effects than generally appreciated,” Byrd says.
https://www.forbes.com/sites/morganstanley/2017/08/02/is-nextgen-changing-business-for-good/#4171aea70b36
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Jul 31, 2017 | Financial Times
By Helen Wong
The world’s largest floating solar power plant came online in Huainan, in eastern China, in May. Floating on a now flooded former coal mining region, it has a capacity of 40 megawatts — enough to power a small town.
The plant is just one of many examples that illustrate the remarkable shift towards lower-carbon technologies in China and India, the world’s two most populous countries. It is part of a “new normal” in the global fight against climate change, and highlights that the centre of that fight is rapidly moving east.
For most of the past few decades, the quest for more sustainable, less polluting transport, energy and other technologies has been happening largely in the west.
Wind farms began appearing in California in the 1980s and now supply more than 8 per cent of that state’s electricity. Germany is several years into a wholesale “energy transition” towards alternative energy sources. Half of all vehicles now sold in Norway are either electric or hybrid.
Now Asia, long a laggard on these fronts, is starting to catch up.
China’s current five-year economic plan includes ambitious goals to reduce carbon intensity and improve water efficiency.
Plans to build more than 100 coal-fired power stations have been cancelled. A carbon emissions trading scheme is due to be launched later this year. Green bond issuance, as a means to financing environmentally friendly projects, is picking up.
Meanwhile, India’s renewable energy programme has accelerated rapidly. The country is planning to install 225GW of renewables by 2022, putting it on course for green energy to account for as much as 57 per cent of electricity capacity by 2027.
Both India and China are making big efforts to promote electric or new-energy vehicles. And research released in May showed that both countries are set to exceed the targets they set for themselves under the 2015 Paris agreement on climate change.
True, the challenges of their green transitions should not be underestimated. It will take years to replace or upgrade the often polluting and inefficient economic activity that was built up during the headlong rush for growth over the past decades.
Politicians and managers may balk at costs and job losses in traditional industries. Ambitious infrastructure projects may, in places, imperil natural habitats. And polluted rivers cannot be cleaned overnight. But the green efforts of India and China are anchored in both environmental and economic considerations — and they are set to pick up speed.
On the environment front, pollution, more extreme weather conditions, droughts and rising sea levels have become increasingly hard to ignore. Many of these effects are felt particularly acutely in China and India, the world’s biggest and third-biggest emitters of greenhouse gases, respectively.
Take air pollution: five of the most polluted cities in G20 countries are in China; 12 are in India. As these countries’ populations have become more affluent and educated, they have also become less tolerant of environmental pain.
Meanwhile, on the business side, technological advances have sharply reduced the cost of low-carbon alternatives. It now makes not just ethical but also commercial sense to build wind farms, or to deploy electrically powered buses on public transport routes.
Perhaps most crucially, the adoption of green technologies is not just about the optics of producing bluer skies. It is also about facilitating the ambitions of China and India to take their economies up the value chain. The “greening” of their economies, far from being a burdensome must-do, is actually a key prerequisite that will support this shift.
After all, both China and India need to increase the productivity of workers and companies if they want to keep growing and avoid getting stuck in the middle income trap. This requires more efficient public transportation, smarter logistics and less wasteful electricity generation and consumption — all of which dovetails neatly with “greening” their economies.
At the same time, China’s policymakers want to turn the erstwhile low-tech “factory floor of the world” into a global high-tech powerhouse. India has similar ambitions. Promoting the use and development of cutting-edge wind turbines, solar panels, electric vehicles and modern building and waste-management systems goes hand-in-glove with this goal. It also means attractive jobs and business opportunities for local and foreign companies.
Last but not least, millions of people are moving into cities every year as India, China and other developing Asian nations continue to urbanise. Lower-emissions infrastructure and energy-efficient buildings are key to managing this process in an environmentally smart way, and avoiding urban gridlock.
Not long ago, many Asian nations prioritised the sheer speed of economic expansion over the quality of growth. Now, policymakers have recognised that low-carbon technologies are part and parcel of their ambitions to achieve sustainable expansion.
It is a mindset change that will take years to fully filter through to all levels of society. But it is producing change at a far faster pace than many observers had dared to hope just a few years ago. Given the threat posed by climate change, that is worth celebrating.
https://www.ft.com/content/3e6ac1dc-75e1-11e7-90c0-90a9d1bc9691
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