Archive for the ‘Low carbon economy’ Category

The last few weeks have seen a flood of Intended Nationally Determined Contributions (INDC) arrive at the UNFCCC offices in Bonn, presumably to be included in the assessment of progress promised by the UNFCCC Secretariat for release well before the Paris COP21.

There are now some 150 submissions and assessing them in aggregate requires some thinking about methodology. For starters, the temperature rise we will eventually see is driven by cumulative emissions over time (with a climate sensitivity of about 2°C per trillion tonnes of carbon – or 3.7 trillion tonnes CO2), not emissions in the period from 2020 to 2025 or 2030 which is the point at which most of the INDCs end. In fact, 2025 or 2030 represent more of a starting point than an end point for many countries. Nevertheless, in reading the INDCs, the proposals put forward by many countries give some clues as to where they might be going.

For Europe, the USA and many developed economies, the decline in emissions is already underway or at least getting started, with most having already said that by mid-century reductions of 70-80% vs. the early part of the century should be possible. But many emerging economies are also giving signs as to their long term intentions. For example, the South Africa INDC proposes a Peak-Plateau-Decline strategy, which sees a peak around 2020-2025, plateau for a decade and then a decline. Similarly, China has clearly signalled a peak in emissions around 2030, although with development at a very different stage in India, such a peak date has yet to be transmitted by that government.

Nevertheless, with some bold and perhaps optimistic assumptions, it is possible to assess the cumulative efforts and see where we might be by the end of the century or into the early part of next century. In doing this I used the following methodology;

  1. Use an 80/20 approach, i.e. assess the INDCs of the top 15-20 emitters and make an assumption about the rest of the world. My list includes USA, China, India, Europe, Brazil, Indonesia, South Africa, Canada, Mexico, Russia, Japan, Australia, Korea, Thailand, Taiwan, Iran and Saudi Arabia. In current terms, this represents 85% of global energy system CO2 emissions.
  2. For the rest of the world (ROW), assume that emissions double by 2040 and plateau, before declining slowly throughout the second half of the century.
  3. For most countries, assume that emissions are near zero by 2100, with global energy emissions nearing 5 billion tonnes. The majority of this is in ROW, but with India and China still at about 1 billion tonnes per annum each, effectively residual coal use.
  4. Cement use rises to about 5 billion tonnes per annum by mid-century, with abatement via CCS not happening until the second half of the century. One tonne of cement produces about half a tonne of process CO2 from the calcination of fossil limestone.
  5. Land use CO2 emissions have been assessed by many organisations, but I have used numbers from Oxford University’s spreadsheet, which currently puts it at some 1.4 billion tonnes per annum of carbon (i.e. ~5 billion tonnes CO2). Given the INDC of Brazil and its optimism in managing deforestation, I have assumed that this declines throughout the century, but still remains marginally net positive in 2100.
  6. I have not included short lived climate forcers such as methane. These contribute more to the rate of temperature rise than the eventual outcome, provided of course that by the time we get to the end of the century they have been successfully managed.
  7. Cumulative emissions currently stand at 600 billion tonnes carbon according to

The end result of all of this are the charts below, the first being global CO2 emissions on an annual basis and the one below that being cumulative emissions over time. The all important cumulative emissions top out just below 1.4 trillion tonnes carbon.

Global CO2 Emissions Post INDC

Global Cumulative Emissions post INDCs

The trillionth tonne point, or the equivalent of 2°C, is passed around 2050, some 11 years later than the current end-2038 date indicated on the Oxford University website. My end point is the equivalent of about 2.8°C, well below 4+°C, but not where it needs to be. The curve has to flatten much faster than current INDCs will deliver, yet as emissions accumulate, the time to do so is ticking away.

Even with a five year review period built into the Paris agreement, can the outcome in 2030 or 2035 really be significantly different to this outlook? Will countries that have set out their stall through to 2030 actually change this part way through or even before they have started along said pathway? One indication that they might comes from China, where a number of institutions believe that national emissions could peak well before 2030. However, the problem with accumulation is that history is your enemy as much as the future might be. Even as emissions are sharply reduced, the legacy remains.

Nevertheless, we shouldn’t feel hopeless about such an outcome. Last week I was at the 38th Forum of the MIT Joint Program on the Policy and Science of Global Change and I was reminded again during one of the presentations of their Level 1 to Level 4 mitigation outcomes which I wrote about in my first book, 2°C Will Be Harder than we Think. These are shown below.

Shifting the Risk Profile

Taking no mitigation action at all results in a potential temperature distribution with a tail that stretches out past 7°C, albeit with a low probability. However, we can’t entertain even a low probability of such an outcome, so some level of mitigation must take place. While Level 1 remains the goal (note however that the MIT 2°C is not above pre-industrial, but relative to 1981-2000), MIT have shown that lesser outcomes remove the long tail and contain the climate issue to some extent. The INDC analysis I have presented is similar to Level 2 mitigation, which means the Paris process could deliver a very substantial reduction in global risk even if it doesn’t equate to 2°C. More appreciation of and discussion around this risk management approach is required, rather than the obsession with 2°C or global catastrophe that many currently present.

Of course, extraordinary follow through will be required. Each and every country needs to deliver on their INDC, many of which are dependent on very significant financial assistance. I looked at this recently for Kenya and India. Further, the UNFCCC process needs its own follow through to ensure that global emissions do trend towards zero throughout the century, which remains a very tall order.

Assessing the INDCs

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It is now just 100 days until COP21 in Paris.

The summer months have seen many Intended Nationally Determined Contributions (INDCs) submitted to the UNFCCC prior to the assessment deadline of October 1st. This is the date when the UNFCCC secretariat will start work on a synthesis report on the aggregate effect of the INDCs as communicated by Parties. Many organisations are already offering assessments of progress, with most basing this on reductions through to 2030 against a notional 2°C pathway.

However, the climate system doesn’t care about 2030 nor does it respond to changes in annual emissions. The real metric is cumulative emissions over time, with each trillion tonnes of carbon released into the atmosphere equivalent to about 2°C rise in temperature rise (this isn’t precisely linear, but it is a reasonable rule of thumb to use). This means that any assessment must look well beyond 2030 and make some bold assumptions as to where the emissions pathways then go. It also means that the wide variety of pledges using metrics such as the share of renewable energy in the power generation mix, installed solar capacity or emissions per GDP, whilst important in the context of energy system development, offer limited insight into the trend for cumulative emissions.

A good example of this comes from looking at the INDC from China. They have pledged the following;

  • To achieve the peaking of carbon dioxide emissions around 2030 and making best efforts to peak early;
  • To lower carbon dioxide emissions per unit of GDP by 60% to 65% from the 2005 level;
  • To increase the share of non-fossil fuels in primary energy consumption to around 20%; and
  • To increase the forest stock volume by around 4.5 billion cubic meters on the 2005 level.

From an energy emissions context, only the first part of this pledge is really important, but little information is given allowing an assessment of its real impact on the climate system. Some big assumnptions will have to be made.

According to the Oxford Martin School carbon emissions counter, global cumulative emissions now stand at nearly 600 billion tonnes of carbon (2.2 trillion tonnes CO2). Back in November 2014 when China and the USA announced their climate deal, I speculated that the Chinese side of the Sino-US deal could see their emissions rising to as much as 14.5 billion tonnes CO2 per annum by 2030 based on the following assumption;

The USA and China appear to have adopted a “Contraction and Convergence” approach, with a goal of around 10 tonnes CO2 per capita for 2030, at least for energy related emissions. For China this means emissions of some 14.5 billion tpa in 2030, compared with the latest IEA number for 2012 of 8.3 billion tonnes, so a 75% increase over 2012 or 166% increase over 2005. It also has China peaking at a level of per capita CO2 emissions similar to Europe when it was more industrial, rather than ramping up to the current level of say, the USA or Australia (both ~16 tonnes). By comparison, Korea currently has energy CO2/capita emissions of ~12 tonnes, so China peaking at 10 is some 17% below that.

Of course China could still peak at lower levels than this and the economic downturn they currently seem to be facing may ensure this. Nevertheless, two reduction pathways following 2030 give a very different cumulative outlook for the period 2015-2100. It is this cumulative outcome that matters, not where China might happen to find itself in 2030. While the period up to 2030 is important, it only tells a fraction of the story. Chinese emissions over that period will likely add some 50 billion tonnes of carbon to the global cumulative total, but this is small compared to their potential remaining cumulative contribution (i.e, before they are at net-zero emissions). The two pathways below illustrate the difference;

  1. A plateau for about a decade, followed by a long slow reduction through to near zero by 2100 means cumulative emissions from 2015 are around 800 billion tonnes of CO2, or 220 billion tonnes of carbon. In this scenario, Chinese emissions alone take the global carbon emissions total to 820 billion tonnes.
  2. A sharp decline from 2030 to zero before 2080 gives cumulative emissions of 550 billion tonnes, or 150 billion tonnes carbon. In this case the global total rises to 750 billion tonnes carbon based on Chinese emissions alone.

Either way, China will have a profound impact on global cumulative emissions. But this fairly simple analysis illustrates that the period from 2030 onwards is where the real story lies, which to date isn’t covered by any of the INDC submissions. For a 2°C outcome, even the lower of the two scenarios above leaves little carbon space for the remaining 7+ billion people living on the planet throughout the 21st century.

Impact of Chinese Cumulative Emissions

The cost of contributions

The process of national governments submitting Intended Nationally Determined Contributions (INDCs) to the UNFCCC is well underway, with a number of developing and least developed economies also submitting plans. Most recent amongst these is a detailed and ambitious plan from the government of Kenya.

The Kenya INDC proposes a 30% reduction in national greenhouse gas emissions from a business-as-usual (BAU) trajectory, which it is also very clear in defining. The plan notes that Kenya strives to be a newly industrialized middle income country by 2030. Current emissions are very low, with the majority coming from land use change (LULUCF). In 2010 emissions were 73 MtCO2eq, with the IEA reporting energy CO2 emissions of 11.4 Mt for that year. Given the population of 41 million in 2010, that gives an energy linked CO2 per capita of 0.28 tonnes, amongst the lowest in the world. Kenya has projected BAU emissions of 143 MTCO2eq by 2030, so that gives them a goal of just on 100 MTCO2eq for that year on the basis of their INDC.

Kenya has also made it clear that their INDC is subject to international support in the form of finance, investment, technology development and transfer, and capacity building. With some of this support coming from domestic sources, they estimate the total cost of mitigation and adaptation actions across sectors at US$40 billion, through to 2030. My first reaction to this was that it seemed like quite a hefty bill, but better to look at the numbers.

First of all, a few assumptions. These are all open to challenge, but they help frame the issue and allow some assessment of the numbers to at least establish a ballpark estimate of value for money and the implications flowing from that.

  1. I will look at mitigation only, so let’s assume that the $40 billion is split between mitigation and adaptation, but with emphasis on mitigation. That allows ~$10+ billion for major public works and capacity building programmes focussed on areas such as water and agriculture and $20-$30 billion in the energy system.
  2. I will assume that energy system growth and adaptation funding allows for a plateau and then gradual decline in LULUCF emissions, such that by 2050 these are below 10 MT per annum.
  3. A BAU for energy emissions only would see Kenya rising to nearly 2 tonnes per capita by 2030 (current Asia, excluding China) and 6 tonnes per capita by 2050 (approaching current Europe). This would mean extensive use of fossil fuels, but supplemented by their geothermal and hydroelectric resources in particular. This is the pathway that they might be on in the absence of this INDC.
  4. Kenya’s population rises in line with the UN mid-level scenario, i.e. to 66 million by 2030 and 97 million by 2050.

Based on the above, energy emissions could rise to some 120 Mt p.a. by 2030 and 600 Mt p.a. by 2050 under a BAU scenario. But in the INDC scenario, this could be curtailed such that they are at 70 Mt p.a. in 2030 and perhaps as low as 130 Mt p.a. in 2050, or 70-80% below BAU. The 2030 number is the more important one for this calculation as this is what the $20-$30 billion delivers, although the benefits of the investment stretch beyond 2030. However, further additional investment would be required to keep emissions at such a low level through to 2050 as energy demand grows.

The deviation from BAU is nearly 50 Mt p.a. by 2030, with that deviation starting in the early 2020s. If the gains are held through to 2050, then the cumulative emission reduction over the period is around 1 billion tonnes. On a simple 20 year project life with no discounting, that equates to around $25 per tonne of CO2 against the $20-$30 billion investment in the 2020s. On that basis, this looks like a good deal and is well within the bounds of plausibility. It could equate to a mixture of expanded renewable energy deployment, natural gas instead of coal and possibly some biofuel development for transport.

What is perhaps more interesting is how this scales up across Africa and other parts of the world where energy access is currently limited. If 1-2 billion people globally need support for similar energy infrastructure, that implies a financial requirement of about US$1 trillion over the period 2020-2030 just for mitigation (i.e. 30+ times the Kenya population of 50 million, multiplied by $US30 billion). This equates to $100 billion per annum, which is also the number that was agreed in Copenhagen in 2009 as the call on increased financial flows to developing countries, although that was for both mitigation and adaptation purposes. It also implies that if the world does reach the US$100 billion per annum goal, then most of this will be for mitigation in the least developed economies as they build their 21st century energy systems.

The flip side of this is that the emerging economies will probably have to self-fund, which argues for the implementation of a carbon price on a far wider basis than is currently envisaged. China is leading the way here, but so too are countries like Mexico and Chile.

The Kenya INDC offers some interesting insight into climate politics in the years to come.

From sunlight to Jet A1

In a world of near zero anthropogenic emissions of carbon dioxide, there remains the problem of finding a fuel or energy carrier of sufficiently high energy density that it remains practical to fly a modern jet aeroplane. Commercial aviation is heading towards some 1 billion tonnes of carbon dioxide per annum so doing nothing may not be an option.

Although planes will certainly evolve over the course of the century, the rate of change is likely to be slow and particularly so if a step change in technology is involved. In 100 years of civil aviation there have been two such step changes; the first commercial flights in the 1910s and the shift of the jet engine from the military to the commercial world with the development of the Comet and Boeing 707. The 787 Dreamliner is in many respects a world away from the 707, but in terms of the fuel used it is the same plane; that’s 60 years and there is no sign of the next change.

Unlike domestic vehicles where electricity and batteries offer an alternative, planes will probably still need hydrocarbon fuel for all of this century, perhaps longer. Hydrogen is a possibility but the fuel to volume ratio would change such that this could also mean a radical redesign of the whole shape of the plane (below), which might also entail redesign of other infrastructure such as airport terminals, air bridges and so on. Even the development and first deployment of the double decker A380, something of a step change in terms of shape and size, has taken twenty years and cost Airbus many billions.


For aviation, the simplest approach will probably be the development of a process to produce a look-alike hydrocarbon fuel. The most practical way to approach this problem is via an advanced biofuel route and a few processes are available to fill the need, although scale up of these technologies has yet to take place. But what if the biofuel route also proves problematic – say for reasons related to land use change or perhaps public acceptance in a future period of rising food prices? A few research programmes are looking at synthesising the fuel directly from water and carbon dioxide. This is entirely possible from a chemistry perspective, but it requires lots of energy; at least as much energy as the finished fuel gives when it is used and its molecules are returned to water and carbon dioxide.

Audi has been working on such a project and recently announced the production of the first fuel from their pilot plant (160 litres per day). According to their media release;

The Sunfire [Audi’s technology partner] plant requires carbon dioxide, water, and electricity as raw materials. The carbon dioxide is extracted from the ambient air using direct air capture. In a separate process, an electrolysis unit splits water into hydrogen and oxygen. The hydrogen is then reacted with the carbon dioxide in two chemical processes conducted at 220 degrees Celsius and a pressure of 25 bar to produce an energetic liquid, made up of hydrocarbon compounds, which is called Blue Crude. This conversion process is up to 70 percent efficient. The whole process runs on solar power.

Apart from the front end of the facility where carbon dioxide is reacted with hydrogen to produce synthesis gas (carbon monoxide and hydrogen), the rest of the plant should be very similar to the full scale Pearl Gas to Liquids (GTL) facility that Shell operates in Qatar. In that process, natural gas is converted to synthesis gas which is in turn converted to a mix of longer chain hydrocarbons, including jet fuel (contained within the Audi Blue Crude). The Pearl facility produces about 150,000 bbls/day of hydrocarbon product, so perhaps one hundred such facilities would be required to produce enough jet fuel for the world (this would depend on the yield of suitable jet fuel from the process which produces a range of hydrocarbon products that can be put to many uses). Today there are just a handful of gas-to-liquids plants in operation; Pearl and Oryx in Qatar, Bintulu in Malaysia and Mossel Bay in South Africa (and another in South Africa that uses coal as the starting feedstock). The final conversion uses the Fischer Tropsch process, originally developed about a century ago.

Each of these future “blue crude” facilities would also need a formidable solar array to power it. The calorific content of the fuels is about 45 TJ/kt, so that is the absolute minimum amount of energy required for the conversion facility. However, accounting for efficiency of the process and adding in the energy required for air extraction of carbon dioxide and all the other energy needs of a modern industrial facility, a future process might need up to 100 TJ/kt of energy input. The Pearl GTL produces 19 kt of product per day, so the energy demand to make this from water and carbon dioxide would be 1900 TJ per day, or 700,000 TJ per annum. As such,  this requires a nameplate capacity for a solar PV farm of about 60 GW – roughly equal to half the entire installed global solar generating capacity in 2013. A Middle East location such as Qatar receives about 2200 kWh/m² per annum, or 0.00792 TJ/m² and assuming a future solar PV facility that might operate at 35% efficiency (considerably better than commercial facilities today), the solar PV alone would occupy an area of some 250 km² , so perhaps 500 km² or more in total plot area (i.e. 22 kms by 22 kms in size) for the facility.

This is certainly not inconceivable, but it is far larger than any solar PV facilities in operation today; the Topaz solar array in California is on a site 25 square kms in size with a nameplate capacity of 550 MW.  It is currently the largest solar farm in the world and produces about 1.1 million MWh per annum (4000 TJ), but the efficiency (23%) is far lower than my future assumption above. At this production rate, 175 Topaz farms would be required to power a refinery with the hydrocarbon output of Pearl GTL. My assumptions represent a packing density of solar PV some four times better than Topaz (i.e. 100 MW/km² vs 22 MW/km²).

All this means that our net zero emissions world needs to see the construction of some 100 large scale hydrocarbon synthesis plants, together with air extraction facilities, hydrogen and carbon monoxide storage for night time operation of the reactors and huge solar arrays. This could meet all the future aviation needs and would also produce lighter and heavier hydrocarbons for various other applications where electricity is not an option (e.g. chemical feedstock, heavy marine fuels). In 2015 money, the investment would certainly run into the trillions of dollars.

What can really be done by 2050?

The calls for action are becoming louder and bolder as the weeks continue to countdown towards COP21 in Paris. Perhaps none have been as bold as the recent call by The B Team for governments to commit to a global goal of net-zero greenhouse gas emissions by 2050, and to embed this in the agreement to be signed at COP21 in Paris.

The B Team is a high profile group of business and civil society leaders, counting amongst its number Richard Branson (Virgin Group of Companies), Paul Polman (CEO of Unilever) and Arianna Huffington (Huffington Post). The team is not just looking at climate change, but the even larger challenge of doing business in the 21st Century; shifting from Plan A which requires business to focus on profit alone, to Plan B which encompasses a more holistic set of objectives around financial performance, sustainability and business as a force for good to help solve challenging social and environmental goals. It is perhaps the next big step forward in what was originally termed “sustainable development”.

Without wanting to question the broader motives of The B Team, I do challenge their view that the climate issue can be resolved in just 35 years. For some this may sound like a long time, but it is the span of just one career. In fact it is the span of my career in the oil and gas industry from when I started work in Geelong Refinery in Australia in 1980. At least in one industry today, IT, everything has changed in that time, but that is not true elsewhere. In 1980 there were no personal computers in Geelong Refinery; today it probably can’t run without them, although the distillers, crackers and oil movement facilities being run by them have hardly changed and in many instances are precisely the same pieces of equipment that were running in 1980. In almost every other industry, the shift has been gradual, perhaps because of the installed base which of course wasn’t an issue for personal computing and mobile telephony. I suspect that this is true in Mr Polman’s own industry (household products) and it is certainly true in Mr Branson’s. In 1980 I flew on my first trip to London on a 747 and today I am in San Francisco, having arrived here on a 747, albeit a slightly longer, more sophisticated, efficient and larger capacity one than the 1980 model, but still a 747 burning many tons of jet fuel to get here. During his time in office which started with the election in 1980, Ronald Reagan replaced the existing Air Force One 707 with a 747 which still flies today but which Mr Obama has just announced will be replaced with a 747-8. Those planes will likely fly for some 30 years, as will all the other planes being built today, with many just entering the beginning of their production runs (787, A350, A380), rather than heading towards the end as we might be with the 747 series. There are also no serious plans for the jet engine to run on anything other than hydrocarbons for the foreseeable future (i.e. 50+ years) and even the attempts to manufacture bio-hydrocarbon jet fuels are still in their commercial infancy.

So why would we think that everything can be different in just 35 years? There is no doubt that to quickly and decisively solve the climate issue and have a better than even chance of keeping the surface temperature rise below 2°C that we need to do this, but that doesn’t mean we can. To start with, there has to be tremendous political will to do so and to be fair, this is clearly what The B Team is trying to foster by making the call. But political will isn’t enough to turn over the installed industrial capacity that we rely on today, let alone replace it with a set of technologies that in some instances don’t exist. The development and deployment of radical new technologies takes decades, with the energy industry able to make that change at about half the rate of the IT industry. Even the latter has needed nearly 50 years to invent (ARPANET in 1969) and extensively deploy the internet.

We are now seeing real progress in the sale of electric cars, but even there the numbers don’t stack up. To completely outpace conventional vehicle manufacture and replace the entire legacy stock of on-road vehicles will take about 50 years, assuming a ramp up of global electric car production of at least 20% p.a. every year until all internal combustion engine manufacturing is phased out. While this might be conceivable for personal transport, the progress on finding an alternative for heavy transport, including ships, is slow.

For medium to heavy industry that relies almost completely on hydrocarbon fuels for high temperature operations in particular, there are no easy alternatives. Electricity could be an option in some instances, but almost all operations today choose coal or natural gas. For smelting, coal is essential as it provides the carbon to act as a reducing agent for the chemical conversion of the ore into a pure metal.

Perhaps the area in which rapid progress will be seen is electricity generation, where a whole range of zero emission technologies exist. These include wind, solar, geothermal, tidal, nuclear and carbon capture and storage. But even with complete success in this one area, we shouldn’t forget that electricity is less than 20% of the current global final energy mix. This will surely rise, but it is unlikely to reach 100% in 35 years given that it has only moved from 11% to 18% the last 35 years.

Shell’s own New Lens Scenarios show that significant progress can be made between now and 2050, but not in terms of a massive reduction in emissions, although that process is clearly underway in the Mountains Scenario by then (see below). Rather, the time to 2050 is largely filled with the early deployment of a range of new energy technologies, which sets the scene for rapid reductions to net-zero emissions over the period 2050-2100. Another critical development for the near-term is a complete global policy framework for carbon pricing. Even assuming big steps are made between now and Paris in even getting this into the agreement, the time for implementation is a factor that must be recognised. With a fast start in Paris, the earliest possible date is 2020 in that this is when the global agreement kicks in, but even the EU ETS took 8 years between initial design and full operation, similarly the CDM alone took over 10 years to fully institutionalize. Expanding full carbon pricing globally in the same period is challenging to say the least.

NLS Emissions to 2100

The aspiration of the B Team is laudable, but not really practical. The Paris agreement should certainly be geared around an end-goal of net-zero emissions but the realistic, albeit still aggressive, time span for this is 80+ years, not 35 years.


The first fridge in town

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The recent visit by President Obama to India and the resulting discussions on climate change between the President and Indian Prime Minister Narendra Modi have once again thrown the spotlight on India’s development pathway and its energy needs.

There were countless articles about the climate change discussions they had, but one story published by the BBC was particularly relevant and poignant. It was about Santosh Chowdhury, a gentleman who lives in the village of Rameshwarpur, on the eastern side of the country. He had just bought a fridge, which may seem uninteresting, but it was the first fridge in his village. There is one thing about refrigeration that is different to almost any other domestic energy consuming device, it requires fairly reliable 24/7 electricity. That means Mr Chowdhury, like many in his town who may now follow him, needs a grid connection and that grid has to be sending electrons his way all the time.

First fridge

This is the start of a long industrial chain that needs a modern energy system to support it. The fridge needs electricity on a 24/7 basis, which excludes the immediate application of renewable energy as the primary provider. Some sort of back-up or energy storage mechanism will be required. In India, given cost considerations, the baseload electricity will likely be generated with coal although it is clear that India are also looking towards nuclear. Solar energy will augment this and at certain times may provide for all Mr Chowdhury’s needs, but unless the town spends considerably more money and installs a more complex grid system with battery capacity, the dependency on coal will continue, at least in the medium term.

But the story doesn’t end there, given that electricity provides only about 20% of final energy needs globally and in India this falls to 15%. The lack of fridges in Rameshwarpur reflects the situation across the whole of India. The BBC article notes that only one in four of the country’s homes has one. That compares to an average of 99% of households in developed countries. In 2004, 24% of households in China owned a fridge. Ten years later this had shot up to 88%. India has about 250 million households, which approximates to 60 million fridges. By 2030 as population rises, people per household decline and fridge ownership approaches Chinese levels, India might have 400 million fridges.

So Mr Chowdhury’s purchase and others following, will mean that India needs to produce more fridges – lots more. In 2000 China was producing 13 million refrigerators per annum, but by 2010 this had jumped to 73 million. This means India needs more refrigerator factories and chemical plants to make the refrigerant. The refrigerators might be made of steel and aluminium which means mining or the import of ores, refining, smelting, casting, stamping and transport. All of these need coal, gas and oil. Coal in particular is needed for smelting iron ore as it acts as the reducing agent, producing carbon dioxide in the process. The intense heat required in the processes is most easily and economically provided by coal or gas, although given time electricity will doubtless make its way into these processes.

Oil will be needed as a transport fuel to ship all these materials from mines to refineries to manufacturing plants to distribution depots, then wholesalers, shops and finally Mr Chowdhury’s home. Although electricity is starting to appear in the transport sector for lighter vehicles, with the exception of railways it isn’t the energy provider yet for heavy transport. In India, rail transport is extensive and electrification is making good progress, but there is still much to be done.

With a refrigerator in the house, the BBC reports that family life for Mr Chowdhury will change. It will be easier, so his productivity in other areas may well rise. This could translate to more income, further purchases and perhaps the first opportunity for air travel in the years to come. That will certainly be powered by Jet A1.

There is no doubt that India is industrialising rapidly and Prime Minister Modi should be commended for his ambitious goal of 100 GW of solar capacity by 2020 and speeding up the nuclear programme, but this won’t stop carbon dioxide emissions from rising sharply in the near term; it is more a question of how high they rise and the more immediate actions that can be taken. I am reminded again of a tender call for 8GW of coal fired capacity in India that appeared in the Economist a while back. This is just one project of many.

India coal

Coming back to the discussions between Mr Obama and Mr Modi, it is clear to me that India faces a huge challenge, which should also be recognised as a global challenge to help them and others make a different set of energy choices. The start with solar is important but it may not be enough to keep coal emissions down in the medium term. So here are three suggestions from me to take India forward;

  1. Develop low cost village scale energy storage to support solar. This could also position India as a key supplier to Africa in the decades to come.
  2. In the short term,  favour natural gas over coal for electricity generation. This would make a real difference to power sector emissions and would help India bypass the severe air quality issues now being faced in China. It would also avoid the cost of retro fits later on.
  3. For the longer term, particularly for industry but also power generation, the real game changer could be carbon capture and storage. This is where more international focus is needed, especially in the development of funding mechanisms to support its deployment in developing countries.

With the choice of a high road and a low road from Lima to Paris, the Parties seem to have selected the dirt track off to the side, replete with rocks, obstacles, difficult terrain and an uncertain destination. However, the map they have crafted in Lima, while full of options and dead ends, does at least have some clear pointers to the outcome that is actually needed. The question is whether or not these are followed.

The Lima call for climate action turned out to be a hard won outcome, with the talks extending into Sunday morning as negotiators struggled to reach agreement over one issue in particular that has dogged the process since its very beginnings in 1992 – the respective roles of developed and developing countries. Many commentators believed that the negotiations in Durban in 2011 had, at least to some extent, relegated this issue to the history books.

In particular, Professor Robert Stavins of the Harvard Kennedy School in Boston, said in his 2011 report on Durban;

It focuses instead on the (admittedly non-binding) pledge to create a system of greenhouse gas reductions including all Parties (that is, all key countries) by 2015 that will come into force (after ratification) by 2020. Nowhere in the text of the decision will one find phrases such as “Annex I,” “common but differentiated responsibilities,” or “distributional equity,” which have – in recent years – become code words for targets for the richest countries and a blank check for all others.

In the aftermath of Lima, the flavour of differentiation has reappeared and even some of the words. The call for climate action now incorporates a clear reference to “common but differentiated responsibilities“, albeit with the addition taglines of “respective capabilities” and “in light of different national circumstances“. Professor Stavins was quick off the mark with an assessment of Lima, but still maintained that the intent of Durban remained;

. . . . the fact remains that a new way forward has been established in which all countries participate and which therefore holds promise of meaningful global action to address the threat of climate change.

It is difficult to agree with this given the recent negotiations. By contrast, Jonathan Grant of PWC referred to the final day of Lima as “trench warfare mentality”. While it is certainly the case that all countries are still required to submit INDCs of some description, the allowable range of options and structure to pick from has broadened considerably. Notably, Parties “may include” details such as quantifiable information and time frames, rather than the previous wording of “shall include”.

Adaptation planning is strengthened considerably, with this subject now highlighted in the opening lines of the Lima text and also referenced clearly in the context of INDCs. For developed countries this probably has little meaning in terms of their own actions, but for a number of developing countries this could be interpreted as a call for additional financial assistance from developed countries simply to build national infrastructure. The Loss and Damage issue also resurfaced with specific mention in the Lima text. These two apparent concessions may turn out to be a high price to pay for retaining some semblance of the Durban mitigation philosophy.

The intensity with which the developed / developing country issue erupted in the last hours of the Lima COP raises valid questions about the negotiations over the coming year. Leaving this particular issue still looking for a solution in Paris itself may be a burden too great for those final days, but it could also be that no matter how much effort is put into solving it in the interim, it will nevertheless emerge again in the last hours in 12 months time simply because negotiations tend to do things like this.

Looking more positively at the Lima call for climate action, the 40 page annex, “Elements for a draft negotiating text“, throws up some interesting tidbits but also a host of negotiating options which will need to be resolved. Two tidbits of note are;

  1. The mention of carbon pricing in the text; “Acknowledging that carbon pricing is a key approach for cost-effectiveness of the cuts in global greenhouse gas emissions.
  2. The reference on several occasions of an end-goal of net-zero anthropogenic emissions; “Also recognizing that scenarios consistent with a likely chance of holding the global average temperature increase to below 2 °C relative to pre-industrial levels include substantial cuts in anthropogenic greenhouse gas emissions by mid-century and net emission levels near zero gigatonnes of carbon dioxide equivalent or below in 2100.

The carbon pricing mention is almost certainly the result of the recent tireless work of the World Bank in getting this critical subject back on the global agenda, but the reference is rather empty in that no strong follow-up text supports it. Rather, there are several vague references to the use of markets and mechanisms.

The “net zero” reference though is quite bold, in that even if this century sees a sharp reduction is emissions, a net zero goal is much more challenging. Residual emissions from agriculture, industrial processes, land use changes and some level of direct fossil fuel use will likely remain well into the 22nd century if not beyond that, which means at a minimum some large scale application of carbon capture and storage at some point in the future.

There was much more to Lima than just the last hours of tense standoff politics, but that is what the world will likely focus on in the coming days. The draft negotiating text sets out some clear options for the future, although if the weakest of these is picked in every instance the end result will have hardly been worth the effort. However, there is also text there that doesn’t have options, so that may well see the light of day in Paris. This is the case for some of the “net zero emissions” wording and also the need for Parties to “develop low emission strategies” and “maintain commitments / contributions / actions at all times“.

As such, there remain a few reasons to be hopeful.

Did the UN Summit shift the dial?

The UN Climate Summit has come and gone and leaders from many countries have made announcements, pledges or at least offered moral support. But are we any better off as a result? Reflecting on the last few days of meetings, events, panels and speeches in New York, I would have to argue for the “yes” case. As such, it contributes another piece to the Paris jigsaw.

UN Climate Summit Jigsaw

Although nothing that was formally pledged or offered is likely to make a tangible difference to global emissions in the medium term, one subject has resurfaced in a major way that can: carbon pricing. While there was still a focus on efficiency and renewable energy at many events, the need to implement policy to put a price on carbon dioxide emissions came through loud and clear. In recent months this has been led by the World Bank and they were able to announce in New York that 73 countries and some 1000 companies have signed their Statement, Putting a Price on Carbon, which is an extraordinary result for just a few months of concerted effort.

Given that this was a UN event rather than a national event, the focus naturally shifted to the global story, with an emphasis on how the Paris 2015 agreement might accelerate the shift to carbon pricing and a carbon market that operated globally. The International Emissions Trading Association (IETA) held a number of events around the city outlining its ideas on how this might happen.

Its kickoff was an event on Monday afternoon, the day before the Summit, where a team led by Professor Rob Stavins of the John F. Kennedy School of Government at Harvard University presented new work on linking various carbon emission mitigation approaches. The work suggests that such linkage could be the foundation mechanism behind a globally networked carbon market and can be found in summary here. It illustrates how even quite different approaches to mitigation might link and then deliver the economic benefits associated with a larger more liquid market.

But if this approach is to be adopted, the big question that would still need to be addressed is how the Paris agreement might actually facilitate it. IETA offered some thinking on is, with an outline proposal that even included some basic treaty text to enable such a process. Given that the 2015 agreement will almost certainly be structured around INDCs, or Intended Nationally Determined Contributions, the text proposal needed to embrace this concept and work with it, rather than attempting to impose a carbon price or carbon market structure by diktat. The basic reason for trading in a market is to exchange goods or services and optimise revenue and / or lower costs as a result, so the text simply suggested that parties (nations) could be offered the ability to exchange and transfer mitigation effort (INDCs) should they (or companies within their economies) wish to do so, but requires that it be recorded in some form of carbon reduction unit. The proposal by IETA is as follows;

Cooperation between Parties in realizing their Contribution

  1. Parties may voluntarily cooperate in achieving their mitigation contributions.
  2. A unified international transfer system is hereby established.

a.  A Party may transfer portions of its defined national contribution to one or more other Parties through carbon units of its choice.
b.  Transfers and receipts of units shall be recorded in equivalent carbon reduction terms.

There could be many variations on this theme, but the idea is to establish the ability to trade and require a carbon unit accounting of it if and when it takes place. Of course many COP decisions will be required in years to come to fully flush this out.

What was interesting about this proposal was the reaction it got from those closer to the negotiating process. Rather than simply acknowledging it, one meeting in New York saw several people debating the wording as if the formal negotiation was underway. I understand that this was exactly the reaction IETA were looking for and hopefully it bodes well for the development of market mechanisms within the Paris outcome.

There were of course other themes running through the various events. The new business coalition, We Mean Business, was actively marketing its new report which attempts to make the case that emission reduction strategies in the business sector can deliver returns on investment approaching 30%. This is a rather misleading claim in that it is primarily focussing on efficiency improvements in certain sectors, which of course factors in the local cost of energy, but particularly electricity. There is no doubt that reducing electricity consumption can lead to improved competitiveness and growth, hence a very attractive ROI, but this is very different to a real reduction in emissions that actually delivers benefits globally. This is a major theme of my recent book. The problem with such claims is that they shift attention away from the much more difficult task of actually reducing emissions to the extent that cumulative atmospheric carbon dioxide is impacted; such reductions require real heavy lifting as delivered through the use of carbon capture and storage.

Overall, It was an interesting week, framed by 300,000 demonstrators on Sunday and a plethora of world leaders speaking at the UN on Tuesday. Just maybe, this was the start of something meaningful.

A huge turnout in New York

I am in New York for Climate Week, which includes the UN Climate Summit on Tuesday. Sunday saw an enormous turnout for the People’s Climate March as can be seen from a few of my pictures below.

Climate march 1 (small)

Climate march 2 (small)

Climate march 3 (small)

Climate march 4 (small)

Climate march 5 (small)

Climate march 6 (small)

Climate march 7 (small)

Climate march 8 (small)

Climate march 9 (small)

Climate march 10 (small)

Energy reality meets Climate Reality

In its enthusiasm to spread the word about the rapid uptake of renewable sources of energy, the Climate Reality Project recently circulated the picture below. It references the amount of wind energy, in particular, that is now being generated in the German State of Schleswig-Holstein.

Climate Reality Renewable Energy

This is Germany’s northernmost state and borders both the North Sea and the Baltic, so benefits from the windy climate that this geography offers. It is well known as Germany’s windiest area


In recent years and as part of the overall push to generate more renewable energy in Germany, considerable wind energy capacity has been installed in this region. While the current level of generation from wind is laudable, this is far from 100% renewable energy. The actual milestone that the state has reached was more accurately described as follows;

The Northern German coastal State of Schleswig-Holstein will be able to mathematically meet its electricity demand fully with renewable energy sources this year if wind yields reach at least average levels, Robert Habeck, Minister of Energy said when presenting a new study last week (May 2014).

This means that the amount of wind (and solar) electricity generated in Schleswig-Holstein will be equal to total demand, but these may not match in terms of timing. At certain times the state will export surplus wind generated electricity into the grid and at other times it will need to draw from the grid to meet its needs, particularly during periods of little wind. Nevertheless, it is quite an achievement, even though it highlights the need for a substantial backup system for renewable electricity generation.

But there is a second major reality associated with “100% renewable energy” statements. We live in a global economy that is only partly powered by electricity, to the extent that even if this electricity is generated entirely from renewable sources, the percentage of renewable energy in the final energy mix will still be less than 20% (see below). Even in OECD countries where electricity is more widely used, this only rises by a few percentage points.

Global final energy 2011

The largest slice of final energy (i.e. energy that is used by the final consumer for the delivery of an energy service, e.g. mobility) is oil, used mainly for mobility in road vehicles, planes, trains and ships. Natural gas and coal are also very large, used primarily for industrial processes such as steel making, chemical plants and similar. Natural gas is also used extensively throughout the world as a residential fuel for boilers and direct home heating.

Coming back to Schleswig-Holstein, the actual percentage of renewable energy in the final mix is probably higher than most areas, not just because of its renewable electricity production but also because of the availability of biomass from the agricultural sector. In Germany as a whole, even if all the electricity was sourced from renewable energy (but it isn’t) and adding to this the biofuel and waste energy sources, a level of ~27% renewable energy would be reached. For Schleswig-Holstein with its current level of renewable generation, that probably translates to ~30% today.

That’s an impressive feat, but it isn’t 100%.