Monthly Archives: January 2012

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Fossil fuel subsidies: a tour of the data

Fossil fuels are subsidised in much of the world, causing billions of tonnes of addition CO2 emissions

• Fatih Birol says ending fossil fuel subsidies could provide half the answer to solving climate change

One of the most surprising and alarming issues in the climate and energy arena is the fact that the fossil fuels causing global warming continue to receive substantial government support, making them artificially cheap and encouraging more of them to be consumed. It’s a form of madness that my colleague Damian Carrington put his finger on recently when he wrote that “the house is ablaze and we are throwing bucket after bucket at it – buckets of petrol.”

What’s particularly baffling is that while government support given to environmentally beneficial renewable power sources is subject to seemingly endless media and political scrutiny, the 500% larger subsidies given to oil, gas and (to a much lesser extent) coal rarely get much attention.

In case that 500% figure sounds hard to believe, here’s a chart showing the IEA‘s estimate of all the energy subsidies given out globally over the last few years. As it makes clear, fossil fuels – and specifically oil and gas – account for the overwhelming majority.

It’s worth pausing for a moment to take in the sheer amount of money we’re talking about here: more than half a trillion dollars in 2008 (when energy prices hit record highs), equivalent to the total GDP of Sweden or Saudi Arabia. The figure was lower in 2010, but so far there’s no obvious sign of a downward trend, seemingly because reductions in subsidies in some countries have been offset by rising energy prices, which can ratchet up the cost of the remaining subsidy schemes.

So where and how are all these fuel subsidies dished up? There are two main source of data: the IEA and the OECD. Let’s look first at the IEA’s analysis, which focuses on the more obvious type of subsidy: government policies designed directly to hold the end price of fossil fuels below the cost of supply. The bulk of these “consumption subsidies” are given out in developing and transitional economies. Here are the top 15 nations by total spend. (You can also see the data on a map if you prefer.)

One thing that’s immediately striking here is that consumption subsidies tend to be biggest in nations that export a lot of fossil fuels, whether it’s Saudi oil or Russian gas. According to the IEA’s Fatih Birol, this is because countries such as these see fuel subsidies as a way to “share out” the benefits of energy exports among their population.

One rationale for subsidising fossil fuels is to help lift poorer members of society out of energy poverty. However, IEA data suggest that the poor receive a disproportionately small amount of the benefits. As the following chart shows, in most cases the poorest 20% of the population typically receive only around 5–10% of the benefits of the subsidies, suggesting that if the policies are designed for poverty alleviation, then they’re not working properly.

So what would happen if all these subsidies were phased out? According to the IEA’s models, we’d see a massive reduction in global fossil fuel use:

This in turn would lead to a huge reduction in greenhouse gas emissions. The following chart shows the IEA’s estimated annual carbon cuts in 2015, 2020 and 2035 relative to a world in which the subsidy regime was left in place. Of course, models aren’t infallible and these figures are necessarily based on a whole set of assumptions about the future, but nonetheless the numbers are strikingly huge. By 2035, the expected savings add up to 2.6bn tonnes of CO2. (To give a sense of quite how much carbon that is, I’ve put current total EU emissions on the graph for comparison.) According to IEA estimates, that kind of cut would be sufficient to provide around half the savings needed to limit global warming to 2C.

Clearly, then, if we’re to have any chance of solving climate change, fossil fuel subsidies need to go. The case for urgently scrapping them seems particularly strong in countries such as Russia and Saudi Arabia where per capita carbon footprints are already higher than the global average.

Things feel less black and white in the case of poorer countries, purely because in a world where rich nations have done relatively little to cut their own emissions, it’s difficult to see how they – or the international agencies they dominate – have the moral authority to demand an end to fuel subsidies in, say, India or Nigeria, where the average person has a footprint 20–40 times smaller than the typical American. This is especially true given that fossil fuel companies in rich countries still receive indirect support through a myriad of mechanisms such as tax credits and government underwriting of corporate risk.

The OECD identified a remarkable 250 such mechanisms in its heroically comprehensive inventory of estimated budgetary support and tax expenditures for fossil fuels. Exactly which of these counts as subsidies as such is open to debate, but by the OCED’s reckoning the total value of government support to fossil fuel companies in its member countries is $45–75bn. I suspect that the sooner we in the developed world ditch these kinds of indirect subsidies, the sooner the rest of the world will be likely to agree to ditch their much larger direct ones.

It won’t be easy, of course – not least because of the powerful influence of the fossil-fuel lobbying machine. I don’t know of any good global data about the relative size of the fossil fuel and renewables lobbies, but where figures are available, the hydrocarbon brigade massively outspend those pushing for clean energy – by a factor of 12 in the US, according to one estimate.

But do it we must, because on a planet staring devastating climate change in the face, spending tax-payers’ money on propping up fossil fuels really is as crazy as throwing buckets of petrol on a house fire.

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How to tackle the climate, health and food crises, all at the same time | Damian Carrington

Reducing the soot pumped out by cars and cooking fires and the methane from coal mines and oil wells would rapidly curb global warming, prevent air pollution deaths and boost crop yields

From coal mines to rice paddies and cooking fires to diesel exhausts, 14 highly cost-effective measures could quickly curb global warming and save millions of lives, while also boosting global food production. That is the striking conclusion of a new study published in Science and the most authoritative look yet at the opportunities offered in tackling methane and black carbon – soot – pollution.

The headline findings are striking. The measures would reduce warming by 0.5C by 2050, very useful indeed with the world failing to get to grips with carbon dioxide emissions. And that’s only half the tale. They would also avert between 0.7 and 4.7 million premature deaths caused by air pollution every year and bump up crop yields by 30 to 135m tonnes a year.

Methane and black carbon have grabbed attention before, in a major UNEP report in 2011 for example, because of the speed with which measures to tackle them take effect. Black carbon floats in the atmosphere for about a week, methane for about a decade, while carbon dioxide hangs around, heating the planet, for about a century. That means cuts in methane and black carbon take effect quickly, though CO2 remains the larger problem.

Drew Shindell, at NASA’s Goddard Institute for Space Studies, who led the research is clear that this is not an either/or situation: “It is not at all a substitution. It would be a big mistake to focus on dealing with the near-term problems of methane and black carbon without also focusing on the problem of carbon dioxide as well.”

Nonetheless, his team’s work shows action on methane and black carbon is hugely worthwhile and, for the first time, the study shows reveals the regional benefits, from a more stable monsoon in India to better growing plants in Mexico.

Half the 14 effective measures identified, winnowed down from a list of 2000, target methane and include capturing the methane leaking from coal mines and oil wells, letting paddy fields dry out from time to time and managing manure better. Cutting the emissions from burping cattle and other livestock were not included, as few options to do so exist. The measures to prevent soot focus on providing cleaner alternatives to cooking and heating fires that burn wood and dung and using filters to capture the soot from diesel cars and trucks, both particular problems in the developing world. Preventing wildfires was not chosen, again because it is very hard to do.

The action would have huge beneficial effects in preventing the disturbance of rainfall patterns, Shindell told me. The Indian monsoon is an example, because the large amount of black carbon in the atmosphere above the subcontinent absorbs sunlight, warms the air and creates air pressure gradients that disturb usual weather patterns. “The monsoon might go somewhere else,” says Shindell. “The disturbance of patterns, that’s a really powerful impact. Regional rainfall is probably much more important to people than rises in average temperature.”

Shindell adds that, in terms of its effect on precipitation, black carbon has five times the effect of CO2. Methane can also affect rainfall, by causing warming that leads to droughts. Cutting methane would particularly help the Mediterranean where droughts are highly likely to increase in intensity as the region heats up.

Black carbon has a particularly strong heating effect when it falls on snow or ice, turning a white reflective surface into one that absorbs much more heat. “The change is just enormous,” says Shindell.

The biggest effect of cutting black carbon, “really substantial numbers” he says, would be right around the Arctic and in the Himalayas, both places that are warming much faster than the global average. The action set out in the paper would prevent 1C of warming around the northern pole and about 0.67C in the Himalayas.

Cutting methane helps crops grow because the gas reacts with carbon monoxide to form ozone, which is a harmful pollutant near ground level. The pores – stomata – of plants shrink as ozone rises, cutting the carbon that can be absorbed and stunting growth. Reducing methane would have the biggest benefits for farmers near the equator, where the sun is strongest, and in places where rains that would wash ozone away are rare, such as Mexico and the Middle east.

The study does a cost-benefit analysis of the measures too, which would cut 40% of current methane emissions. Shindell says about three-quarters of the reductions they consider can be achieved at a cost of less than $250 a tonne, with the last quarter costing about $1000 a tonne.

That stacks up against the benefits, which are valued between $700 and $5000, depending in part on how you chose to value averted deaths. But the benefits clearly outweigh the costs, says Shindell. “Black carbon has such a powerful, harmful effect on human health that the benefits are vast, trillions of dollars.”

Like climate change, the case for action is convincing, cost effective, humanitarian and urgent. So will the world act now?

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America’s top 10 polluting power stations

Newly released data from the US Environmental Protection Agency shows the biggest carbon emitters among the country’s coal power stations

It just got a whole lot easier for Americans to find out which power plants and industrial sites are releasing the most planet-baking emissions. The Environmental Protection Agency on Wednesday released its greenhouse gas database, and included some cool tools for tracking polluters.

The database includes the largest sources—the 6,700 power plants and heavy industries that are responsible for 80 percent of all emissions in the US. It covers their emissions for 2010, the first year they were required to report to the EPA. The inventory, which we’ve written about before, is really just an exercise in taking stock and disclosing emissions. It doesn’t include any requirements to reduce those emissions. But it could be a first step in that direction.

For one, the database makes it clear who is releasing the emissions, and how much. Citizens can see who the big polluters are in their area. Local papers can report on it. Maybe it will even spark some healthy competition between facilities to reduce their cut back—like The Biggest Loser, for power plants. Or it could be used to shame companies whose emissions keep going up. This is basically what happened with an earlier database, called the Toxics Release Inventory. In the 1980s, it was created to track nasty emissions, which companies began cutting even before mandatory reductions were phased in. After all, no one wants to be called out publicly for farting at the party, so to speak.

The inventory includes carbon dioxide emissions (CO2), as well as other greenhouse gases like methane and nitrous oxide. These are the gases that scientists say are trapping heat in the atmosphere and causing the planet to warm up. This is the first time the agency has compiled site-specific emission figures for all all major sources, including power plants, refineries, chemical plants, and landfills.

The top ten in full:

1. Scherer coal plant in Juliette, Georgia. Total greenhouse gas emissions: 22,978,929 CO2e.

2. Bowen coal plant in Cartersville, Georgia. Total greenhouse gas emissions: 21,026,397 CO2e.

3. Miller coal plant in Quinton, Alabama. Total greenhouse gas emissions: 20,752,490 CO2e.

4. Martin Lake coal plant in Tatum, Texas. Total greenhouse gas emissions: 18,701,286 CO2e.

5. Gibson coal plant in Owensville, Indiana. Total greenhouse gas emissions: 17,993,350 CO2e.

6. Monroe coal plant in Monroe, Michigan. Total greenhouse gas emissions: 17,850,341 CO2e.

7. Labadie coal plant in Labadie, Missouri. Total greenhouse gas emissions: 17,365,003 CO2e.

8. Colstrip coal plant in Colstrip, Montana. Total greenhouse gas emissions: 17,120,416 CO2e.

9. Gen J M Gavin coal plant in Cheshire, Ohio. Total greenhouse gas emissions: 16,872,856 CO2e.

10. Rockport coal plant in Rockport, Indiana. Total greenhouse gas emissions: 16,666,035 CO2e.

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