Tuesday, 3 February 2015

New Economics Foundation: "clean energy gains ground"

During Climate Week in Sidmouth next month, the New Economics Foundation will be looking at: 
> the science of climate change, 
> the threats to our coastal and marine environments, 
> the tools of systems change analysis, and 
> how these understandings can bring about ‘place-based transformation’: 
Futures Forum: Climate Week in Sidmouth ... The New Economics Foundation and systems change >>> "Coastal Communities and their Local Economies" >>> Saturday 7th March at 4.30pm

The focus will be the context of the changing climate – but within that there will be a look at how communities can build resilience 
... and one of the practical steps will be to consider how local communities can build their own energy networks and how that is much more affordable:

New Economics Foundation

Ever since oil and gas prices started to plunge, speculation that cheaper fossil fuels would mean a serious setback for renewables has been rife. Considering the latest data, however, it seems renewables are still going strong and it is the fossil fuel industry that is running into both short and long-term difficulties.

Investment in clean energy worldwide jumped by 16% in 2014 to £310 billion, just 2% shy of the all-time high in 2011, as Bloomberg New Energy Finance reports. Against the backdrop of a slowing world economy, this is certainly impressive. Falling costs make renewables increasingly competitive, as our chart of the week from the International Renewable Energy Agency (IRENA) illustrates. The best onshore wind projects now match or even undercut electricity generated from fossil fuels (even without subsidy) and cost of utility scale solar power has halved since 2010.

While renewables are on the up, fossil fuels have increasingly come under pressure. In the short term, the oil price slide has forced companies to slash their exploration and production spending, shedding staff and cancelling projects as they become unprofitable. The long term may look bleak, too. Following the recent report by University College London confirming the majority of known fossil fuel reserves will need to stay in the ground to remain within 2C of warming (see Energy Crunch: Unburnable Oil), pressure from the divestment movement is mounting. Its growing influence could be far more damaging to traditional energy firms’ business models than unstable oil prices. Already a coalition of 150 major investors have filed a resolution requiring BP and Shell to disclose their value at risk to climate change, while fund manager AXA IM acknowledged the reputational risk associated with investing in fossil fuels.

It hasn’t been a good week for British shale gas either. No sooner had Cuadrilla received permission from the Environment Agency to resume drilling activities in Lancashire than a Lancashire County Council report recommended against granting planning permission for two sites. What’s more, challenges to the government’s controversial infrastructure bill will mean that Scotland will be excluded from new rules to allow fracking firms automatic access under people’s homes and drilling firms will also be legally bound to reveal information on chemicals used for fracking. Expect many more local battles to be fought.

The economic case for renewables remains strong, as does the environmental. Oil price turmoil shouldn’t be allowed to overshadow the bigger issues at stake – new analysis confirmed this week that 2014 was globally the hottest year on record.

Best wishes,
Sandra Bernick
Co-editor, Energy Crunch

Three things you shouldn't miss this week

  1. Chart: Increasingly competitive renewables

  2. Article: Power from fossil fuel drops to 35-year low in Germany - In 2014, German coal power production fell considerably year over year – and to the lowest level since 2011.
  3. Article: At least one major oil company will turn its back on fossil fuels - Former industry adviser, warns over plunging commodity prices and soaring costs of risky energy projects.

Energy Transition

Renewables Competitive With Fossil Fuels : IRENA - Biomass, hydro, geothermal and onshore wind are all competitive with or cheaper than coal, oil and gas-fired power stations.
Invisible fuel - The biggest innovation in energy is to go without
Germany wants robust single energy market, at odds with Britain - Europe's energy union needs to be bolstered by EU laws binding on each nation, Germany has said in a policy paper that sets it at odds with Britain.
German Offshore Wind Capacity More than Doubled in 2014 - At the end of 2014, total installed offshore wind capacity stood at 2.35 gigawatts (GW), compared with 915 megawatts (MW) at the end of 2013.
Global campaign aims to inspire British cities to choose 100% clean energy - Hope that example set by Munich, Seattle, Lima and others will prompt pledges to commit to zero emissions by 2050.

Oil & Gas

Obama moves to create first methane limits for gas drilling - Environmental experts say proposal falls short because it leaves out existing sources of methane pollution.
Russia to cut EU gas transit via Ukraine - The EU should start building "today" or Russian gas will go to other markets, Gazprom said.
Oil industry cuts jobs and exploration budgets in response to falling prices - Carbon Brief looks at the cuts some of the industry's key players are making in response to the oil price drop.
IEA Sees Oil-Price Recovery; Cuts 2015 Non-OPEC Output Estimate - The slow-down in non-OPEC output will lead to a “rebalancing” of currently over-supplied global markets in the second half, reviving prices, the agency said.
Age of $100 oil will return as energy industry cuts too deep - Jobs cuts and cancelled projects mean that oil prices could bounce back harder and faster than before.
U.S. Crude Production Advances Even as Prices Decline -Drillers that unlocked the shale oil boom in the U.S. are finding it hard to shut off the nozzle.
China Makes Most of Oil’s Collapse as Demand Rises to Record - Apparent oil demand, a measure of consumption, rose to an unprecedented 10.63 million barrels a day in December.
Poland's shale gas revolution evaporates in face of environmental protests - Fear and loathing stalk Poland’s shale fields, where a 400-day site occupation stopped a Chevron drill earlier this year


Sellafield nuclear clean-up taken back into state hands - Government strips Nuclear Management Partners of its contract to manage Sellafield, saying the Cumbrian site is "too complicated" for private sector management.
Global nuclear decommissioning cost seen underestimated, may spiral - German utility E.ON's breakup has led to worries that funds set aside for decommissioning reactors will not suffice, but globally the cost of unwinding nuclear is uncertain as estimates range widely.
Dungeness B nuclear power station given 10-year reprieve - Dungeness B nuclear power station is to stay open beyond its scheduled closing date of 2018, its owner, EDF, has announced.
Questions about UK scrutiny of Chinese nuclear tie-up - The government is refusing to say whether it has followed its own rules in allowing China's investment in the new £24bn Hinkley nuclear power plant, citing questions of national security.


Tumbling Russian rouble pulls European coal prices with it - European coal prices have struggled much more than other global benchmarks this year, catching many traders by surprise.


Cuadrilla Lancashire fracking application 'should be refused' - The Lancashire County Council report follows an application by energy firm Cuadrilla to explore Little Plumpton and Roseacre Wood for shale gas.
UK's shale gas revolution falls flat with just 11 new wells planned for 2015 - Progress on fracking ‘glacially slow’ despite backing from prime minister and promise of generous tax breaks.
Environment Agency gives Cuadrilla Resources green light to drill again - The company admitted its drilling activities probably caused earthquakes near Blackpool last year.
Companies will be legally required to reveal chemicals used for fracking - Infrastructure bill amendments on ground water pollution and ‘well-by-well disclosure’ accepted, but Labour maintains regulation is still flawed.
Lancashire fracking: Jobs claim is over-hyped, Friends of the Earth claims - The number of jobs that would be generated by the fracking industry in Lancashire has been "over-hyped", Friends of the Earth (FoE) has claimed.
New fracking rules will not apply in Scotland, UK government pledges - The Infrastructure Bill currently going through Westminster is set to allow underground access in England, Wales and Northern Ireland but not Scotland.
Wind power 'adds resilience to UK energy market' - Installing more wind turbines will make the UK's energy market more resilient to global fossil fuel price shocks, an independent report has concluded.
Electricity demand hits highest this winter as wind power slumps to its lowest - Power demand hit its highest level this winter on Monday, but wind farms met just one per cent of the UK's needs.


2014 officially the hottest year on record - Nasa and Noaa scientists report 2014 was 0.07F (0.04C) higher than previous records and the 38th consecutive year of above-average temperatures
Axa IM warns that companies linked to fossil fuels risk their reputations - Climate risk is becoming ‘synonymous with reputation risk’ as a growing fossil fuel divestment movement gains traction with investors around the world.
Coalition of investors to pressure oil firms to go green - An unprecedented coalition of investors has pledged to put pressure on BP and Shell to become more environmentally friendly by forcing the UK oil giants to assess, announce and tackle the dangers they pose to the climate.

Related Reports and Commentary

Renewable Power Generation Costs in 2014 - International Renewable Energy Agency (IRENA)
Our Renewable Future - Richard Heinberg, Post Carbon Institute
Invisible Energy: Hidden Benefits of the Demand Side - Association for Decentralized Energy
How energy conversion drives economic growth far from the equilibrium of neoclassical economics - New Journal of Physics
The impact of wind energy on UK energy dependence and resilience - Cambridge Econometrics for RenewableUK
The Energy Crunch team: Sandra Bernick, Griffin Carpenter, Stephen Devlin, Simone Osborn, David Strahan

Energy round-up: clean energy gains ground | New Economics Foundation

See also:
Futures Forum: Climate change: 'stranded assets' and 'unburnable oil' ...... or the pressures to leave oil and gas in the ground
Futures Forum: "I believe humanity is making risky bets in the climate casino ... But it is always possible that humanity will wake up and make the needed investments in rapid change, driven by the magic of the market and technological innovation."

Futures Forum: Neighbourhood Power: The New Localism
Futures Forum: Community energy schemes to lose tax relief ... incentives which have 'propelled the transformation of the German energy market'

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