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Climate Change Initiative Newsletter
June 2002 (24)
Table of Contents
Climate Change Initiative
Upcoming Events
Kyiv, July 10-11
International conference “Investment and Climate Change: Opportunities for Ukraine”
Ministry of Ecology and Natural Resources of Ukraine and the Climate Change Initiative are looking forward to welcoming the Conference participants at the event. The Conference main target is to attract investments in climate change mitigation projects in Ukraine.
U.s. Climate change NEWS
1. Corporations Signal: Climate Change Is à Risk, Underweight by Boards and Investors
2. Economists Say Global Warming Mitigation Costs About Zero
4. Big Corporations Rely on Renewable Energy
International Climate Change News
5. Point Carbon Study: Kyoto Ratification Prospects
6. EU Energy Sector Poor Environmental Performance Reported
7. Carboncredits.nl Selected 32 GHG Mitigation Projects
8. New Zealand Farm Foresters Criticize Government Carbon Credits Policy
9. Green Energy Certificates to Be Traded in Sweden
11. The Car Industry Environmental Efforts Summary
12. Co-firing of coal with wood and straw – à UK GHG mitigation effort
13. Brazil revives the alcohol motor
14. Everest Glacier Melts, UN Said
15. Mitsubishi Heavy to Recycle Co2
16. Prices Grow at the UK Carbon Market
1. Corporations Signal: Climate Change Is à Risk, Underweight by Boards and Investors
There is mounting evidence that failure to respond to the risks posed by climate change could result in multi-billion dollar losses for U.s. businesses and investment portfolios, and this failure could represent à breach of fiduciary duty on the part of corporate directors and investment decision-makers, according to à report released in April.
The report, Value at Risk: Climate Change and the Future of Governance, was released by CERES, à coalition of investor and environmental groups that works with over 70 companies on corporate environmental responsibility. Investor members represent more than $300 billion in assets. The report is one of the first to make à direct link among climate change, fiduciary responsibility, and shareholder value. Robert Massie, Executive Director of CERES said - "The risks are two-fold: first, the economic/financial risk from the damages due to climate change itself, and second, exposure to the cost of greenhouse gas emissions from climate change regulation and potential litigation. This is another case of an 'Off balance sheet' risk that is not being reported to shareholders."
At the same time, Massie explained "proactive action on climate change presents opportunities for new and expanded business activity, reduced costs, and increased shareholder value that will produce à net economic benefit."
The report recommends that corporate directors should require company executives to assess current and probable risk exposure, disclose company emissions and climate risk exposure to shareholders, benchmark the company against industry peers, announce and implement à strategy to reduce greenhouse gas emissions on à clear timetable, and link executive compensation to the companyús performance on that strategy.
It also advises the institutional investors to conduct à portfolio-wide assessment of climate risk exposure, incorporate climate change considerations into investment strategies, increase investment into energy efficiency and clean energy opportunities, etc.
"One of our main conclusions is that climate risk is not limited to any one sector," Massie said. "As this report demonstrates, it is now difficult to identify à sector of the economy that would not be affected in some way by climate change. The question is no longer whether any given portfolio contains climate risk, but how much."
Massie also expressed hope that this report would challenge the leaders of corporations, institutional investors, and governments to stop ignoring the potentially disastrous financial consequences of climate change and to take clear, measurable actions that will insure that the long-term prosperity of our economy and our planet is not put at risk.
(The carbontrader, April 18)
2. Economists Say Global Warming Mitigation Costs About Zero
A top economist says fixing global warming now will have next to no impact on the long-term global economy. He uses the same economic data as those who tell President George Bush that industry will suffer if he stops them polluting. People are expected to be five times richer in 100 years time but the new study says that will be delayed by just two years if politicians act now.
Christian Azar, à Swedish energy economist, teamed up with US climate scientist Stephen Schneider to carry out the study. They believe their work will persuade the public that acting now will bring few hardships.
Azar says he has based his work on the same figures used by Bushús advisors but claims his report just puts the cost in context. Those advisors predict stabilising carbon dioxide at twice their pre-industrial levels would cost between $1 trillion and $8 trillion. Although that sounds like à lot, Schneider says the same economists predict à 2% annual economic growth rate which would almost mask the long-term cost.
Schneider told: "To be 10 times richer in 2100 versus 2102 would hardly be noticed." He adds: "The wild rhetoric about enslaving the poor and bankrupting the economy to do climate policy is fallacious, even if one accepts the conventional economic models."
(Ananova, June 12)
DETROIT - Your home could be the service station of the future. Within 10 years, the filling station could face competition from the natural gas, electricity and even the water supplied to homes, General Motors Corp officials say. "Your home could be your source of energy, your source of power, for your fuel cell vehicle."
"Where are you going to make your hydrogen from?" was said by Jim Kliesch, co-author of an environmental guide to cars and trucks, to be à rather costly question. One potential answer to the "infrastructure question," as those in the industry call the search for à source of hydrogen, lies in the fuel cell itself.
Run backwards and plugged into an electrical outlet, the fuel cell aboard à car or truck could act as an electrolyzer to create hydrogen from water or natural gas, Larry Burns, GM Vice President said. Such technology is already in use on submarines, which create oxygen for their crews to breathe from sea water, with hydrogen released back into the ocean. "The first thing you do at night when electric rates are low is you plug the electricity into the vehicle and à water hose, you run it backward through the electrolyze, create the hydrogen for your morning trip," Burns said. "Other times you could come home with hydrogen in your vehicle and use your vehicle as à back-up source of electricity for your home."
Daimlerchrysler AG is taking the clean car literally. Its Natrium fuel cell minivan, à test vehicle up and running since March, stores hydrogen in à mixture of sodium boro-hydride, à chemical cousin of laundry soap. Unlike gasoline and other fossil fuels, sodium boro-hydride contains no carbon. Daimlerchrysler said that à tank of sodium boro-hydride solution about the size of à regular gas tank can power the concept vehicle about 300 miles. Borax, the essential element in sodium boro-hydride, is readily available in North America, but Chrysler hasnút solved yet how the large quantities required could be transported in à cost-effective way from borax mines to filling stations.
To be sure, the 180,000 gasoline stations in the United States wonút be going away. For one thing, fuel cell vehicles will need to fill up when on long trips away from home. And GM is working with oil companies such as Chevrontexaco Corp. and Exxon Mobil Corp. on fuel cell research. GM has developed à gasoline reformer, which converts gasoline in à car into hydrogen to run fuel cells.
The reformers could be placed at the gas station and pure hydrogen could be pumped into the carús tank. "They're not going to sit back and let this happen to them," Burns said of the oil companies. "So what weúre hoping that we can do is create à good dynamic between electricity, natural gas and petroleum as sources of energy for transportation."
(by Michael Ellis, REUTERS, May 30)
4. Big Corporations Rely on Renewable Energy
WASHINGTON - IBM Corp., General Motors Corp and two other companies said they are buying electricity generated from wind farms and landfill gas as part of an environmental groupús push to develop cleaner sources of energy.
The companies are members of à coalition led by the World Resources Institute, an environmental think tank which is trying to persuade corporate America to use more renewable energy. The green power group aims to help companies create 1,000 megawatts of renewable electricity by 2010. So far, the coalition has companies in à dozen states generating à total of 15 megawatts of renewable power. One megawatt is enough to supply roughly 1,000 homes.
IBM said its plants in Minnesota and Texas were now buying more than 5.4 million kwh of wind-generated electricity annually. The use of renewable power and energy efficiency measures have helped the company cut its carbon dioxide emissions by 28 percent during the past decade, IBM said.
General Motors, another member of the coalition, said it was now using landfill gas to power boilers at à truck assembly plant in Indiana. The automaker plans to buy 8 million kwh or more of electricity generated from landfill gas in Michigan to power à vehicle parts plant.
Johnson & Johnson, à maker of health care products, said it installed solar photovoltaic systems totaling nearly 350 kilowatts on the rooftops of three of its buildings.
A fourth company, Kinkoús, the chain of office copy shops, said it now buys renewable power at 80 of its U.s. stores. That amounts to about 4.2 million kwh annually bought from wind farms, landfill gas, geothermal sources and small hydroelectric power projects.
"The projects announced are the result of à tremendous effort over the past two years to build the business case and create cost-competitive green power," Jonathan Lash, president of the World Resources Institute, said in à statement.
(REUTERS, June 12)
International climate change news
5. Point Carbon Study: Kyoto Ratification Prospects
The Point Carbon released à study that provides an updated assessment of different price regimes for emissions trading under the Kyoto framework. The paper combines results from an expert poll with numerical simulations for various assumptions regarding market structure and behaviour.
Results from the expert poll suggest that the likelihood of the Kyoto Protocol entering into force within 2003 has decreased from previous estimates to 69 per cent. However, the standard deviation based on the individual ratings in the poll is significant, about 17 per cent, reflecting prevailing uncertainties regarding the ratification processes in countries like Russia, Japan, Canada and Australia. The experts also were asked to rate the likelihood for three scenarios based on the ratification by different groups and countries. The experts rated the scenario with ratification by Eu25+ooecd+russia+japan as the most likely (58 per cent), while the scenario including Canada and Australia was rated à low-probability scenario (13 per cent).
Using the probabilities assigned to each of the scenarios, Point Carbon used Monte Carlo simulations to obtain new estimates of the carbon price in year 2010 and the net present value for emissions trading under the Kyoto framework. Simulations show that estimated carbon prices are significantly lower than previous ones, which reflects the inclusion of scenarios with lower demand (i.e., without Australia and/or Canada) and à lower probability for entry into force.
The price estimates are based on the assumption that dominant sellers co-operate in restricting supply of excess allowances so as to maximise joint profits. However, it is not to be taken for granted that Russia or other countries with huge surplus of allowances will be able to act as price manipulators. Owing to the political difficulties involved in finding buyers for substantial volumes of excess allowances, it could be that Russia and others instead become price takers to the extent that prices are determined by the costs of other compliance tools like Cers and Erus. This leaves ample opportunities for considering other scenarios and price regimes for emissions trading under the Kyoto Protocol. For instance, in an upcoming analysis Point Carbon will examine how expectations of à second commitment period may affect prices under the first commitment period.
(Pointcarbon.com, June 7)
6. EU Energy Sector Poor Environmental Performance Reported
The European Environment Agencyús first report on energy and the environment in the EU was published on May 30. "The report shows that, while there have been some successes, overall progress in building environmental protection needs into energy policy has so far been insufficient," said Domingo Jiménez-Beltrán, EEA Executive Director.
EU emissions of greenhouse gases fell by 3.5% between 1990 and 2000, but without additional counter-measures they are likely to rise back to around their 1990 level by the year 2010. This is because of à projected increase in energy-related emissions, driven mainly by strong demand for transport fuels. The EU would consequently be at risk of missing its target, set under the Kyoto climate change Protocol, of cutting greenhouse gas emissions to 8% below their 1990 levels by the 2008-2012 period. Furthermore, energy consumption levels are expected to continue increasing beyond 2010. This will make greenhouse gas emission cuts difficult to achieve unless policy action is taken now to change long-term patterns of energy production and consumption.
Manufacturing industry has successfully "decoupled" its energy consumption from its economic growth, but it is the only sector to have done so. Its energy consumption in 1999 was about the same as in 1990.
The report main findings include the following:
· Energy consumption rose by an average of 1.1% à year between 1990 and 1999, mainly because of growth in transport but also in the household and services sectors. Growth is expected to continue to 2010, though at à lower rate, as an agreement by the car industry to improve vehicle fuel efficiency yields results.
· Subsidies continue to distort the energy market in favour of fossil fuels, even though the pressures these impose on the environment are well known.
· While innovation is needed to help develop less-polluting technologies, spending on energy research and development fell by around 30% between 1990 and 1998.
· The share of electricity produced from combined heat and power (CHP) increased from 9% in 1994 to almost 11% in 1998, but faster growth is needed to meet the Euús indicative target of an 18% share by 2010. Preliminary information suggests that Chpús share of electricity declined between 1998 and 2001.
· Renewable energy output grew by an average 2.8% per year between 1990 and 1999 but its share of total energy consumption grew only slightly, from 5.0% to 5.9%, because total consumption also rose. Projections of future energy demand imply that the annual rate of growth in renewable energy needs to more than double, to 7%, if the Euús indicative target of à 12% share by 2010 is to be met. Experience in some Member States suggests that certain support measures can accelerate growth.
· Similarly, the growth rate of electricity produced from renewable energy sources (2.8% per year between 1990 and 1999) needs roughly to double if the indicative target of raising renewables' share of EU electricity consumption to 22.1% by 2010 is to be reached.
· Total EU greenhouse gas emissions fell by 3.5% between 1990 and 2000 but energy-related emissions, by far the largest component, fell by much less. This makes significant reductions in total emissions unlikely in the medium term.
· The fall in energy-related greenhouse gas emissions over the last decade was achieved through considerable reductions by the manufacturing and energy supply sectors, such as the electricity sector. These reductions were mostly offset by growth in transport.
· Measures taken to reduce atmospheric pollution from energy use are proving successful, with à number of Member States on track to meet EU targets for reducing emissions of sulphur dioxide, nitrogen oxides and non-methane volatile organic compounds by 2010.
· The electricity sector significantly reduced its emissions of acidifying pollutants and greenhouse gases, mainly as à result of the switch from coal and lignite to natural gas and the introduction of specific measures to address acidifying emissions. Improved efficiency and an increase in the share of electricity from nuclear energy and renewables also contributed to this development, though in à much smaller way.
(EEA, May 30)
7. Carboncredits.nl Selected 32 GHG Mitigation Projects
In course of its Carboncredits program, the Dutch government considered 107 companies that expressed their interest, and invited 32 companies to submit à proposal.
In the coming four months each potential supplier will prepare à Project Design Document (PDD) that includes à baseline study. An independent entity will validate the PDD and baseline. In accordance with the CDM and JI guidelines of the Marrakech accords, the Project Design Document will be made public to allow stakeholders to comment. If required by the Host Country, an Environmental Impact Assessment could be part of the process. Finally, the Host Government should approve the transfer of the Emission Reductions to the Netherlands.
Results of the selection phase
|
2001 |
Received |
Selected |
Countries(# of projects) |
|
Cerupt |
80 Expressions of Interest |
26 Expressions of Interest |
El Salvador (1), Costa Rica (4), Panama (3), Jamaica (1), Peru (1), Bolivia (1), Brazil (2), India (6), Indonesia (2), China (2), Nigeria (1), Kenya (1), Uganda (1) |
|
Erupt |
27 Expressions of Interest |
6 Expressions of Interest |
Estonia (1), Slovakia (1), Hungary (1), Romania (2), New Zealand (1) |
(Carboncredits, June 5)
8. New Zealand Farm Foresters Criticize Government Carbon Credits Policy
Some farmers say they believe it is unfair of the Government to effectively hijack the hundreds of millions of dollars which farm foresters could have expected to earn from carbon credits expected to be traded under the Kyoto Protocol. And the farmers are critical of the Governmentús current consultation process.
Middle Districts Farm Forestry Association councilor and Wanganui farm forester Dougal Mcintosh said it was clear the Government intended to nationalize all carbon credits in the first commitment period of the protocol process. "The Government, though, is ignoring the fact that farm foresters, investment foresters and some second tier forestry companies are responsible for generating the majority of the carbon credits," he said.
In New Zealand, most of the new forests created since 1990 have been planted by small foresters, farmer, lifestylers and investment trusts, rather than the big corporations which have been mostly replanting existing forests, which earn no credit because their carbon was stored before 1990.
In 1999, à senior policy analyst at the Ministry of Agriculture and Forestry (MAF), Kevin Steel, was telling farm foresters they might be able to expect windfall earnings if New Zealand was able to sell rights to 130 million tonnes of carbon credits at à world price of between $10 and $30 à tonne. But since then Mr Hodgson has confirmed that New Zealand will be able to make à net profit on carbon credits from about 55 million tonnes of carbon dioxide "savings" surplus to New Zealandús needs.
Economic tools such as carbon charges and sink credits would only come into being after the protocol came into force, but if they did the Government was canvassing the potential for using some of them to pay landowners who were prepared to protect with title covenants regenerating native forests and conservation forestry which would not be cut down.
But Mr Mcintosh said it was the small foresters who had provided the Government with the credits. "Yet we are given no recognition for this in the Governmentús preferred policy package for ratification of the Kyoto Protocol," he said. And adding insult to injury, Mr Mcintosh said the Government was hitting farm foresters with à double whammy. "While no direct methane tax is envisaged for the livestock industry, the industry must commit itself to à voluntary levy to fund research into ruminant methane emissions.
"We farm and grow trees. What methane is emitted from our livestock is offset by the carbon we create from our trees," Mr Mcintosh said.
(Co2e.com, May 27)
9. Green Energy Certificates to Be Traded in Sweden
STOCKHOLM - Swedenús energy minister said he would demand that all energy suppliers sell green certificates together with electricity from 2003 to help promote à shift to renewable energy sources.
He added that the market in trading such certificates was likely to become pan-scandinavian. "This system will force producers to invest in renewable energy," Industry and Energy Minister Bjorn Rosengren noted. "It will become à separate market, and I would guess that other countries would like to join," he said, adding that he saw Norway and Denmark as likely candidates. Both countries recently decided to set up domestic trading systems.
Green certificates are issued free to producers of renewable energy such as wind, solar and bio-energy who can them sell them in the marketplace. The certificates allow the buyer to emit carbon dioxide and therefore promote renewable energy and penalise producers of electricity from fossil fuels like oil and coal.
Rosengren said the Swedish initiative came on the back of an energy white paper whereby the government aims to increase Swedenús renewable energy production by 10 terawatt hours (Twh) by 2010, rising to 15 Twh by 2012 if the system proves à success. "We hope that after eight years the market will represent 10 terawatt hours, which is about 7-8 percent of our total generation of some 150 terawatts à year," he said.
Rosengren said the market would push down prices on the emission quotas of greenhouse gases and ensure that the building of new renewable energy capacity came with an acceptable price tag. "But consumers are clearly the ones who will have to pay for it," Rosengren said. He estimated that à typical house owner would see an increase of about 150 Swedish crowns ($15.08) in the annual power bill.
The quotas are estimated to cost between 0.06-0.20 crowns per megawatt hour of electricity for the first two years from 2003 before stabilising just below 0.20 crowns. That assumes that the scheme will spur invstments into new renewable energy in line with the governmentús estimated growth rate at 10 Twh by 2010. Power-intensive industry will be exempt from the green certificates scheme.
(Planetark, May 28)
COPENHAGEN - Denmarkús independent Economic Council, known as the wise men, said the installation of wind turbines is now profitable due to new technology following 10 years of losses for the society.
Denmark has been à pioneer in the wind power industry during the past decade, supported by à pro-wind energy Social Democrat-led government, and today hosts some of the largest wind turbine makers in the world, Vestas, NEG Micon and privately owned Bonus Energy.
Danish wind power policy has changed after à centre-right government took office after last Novemberús election. Guaranteed minimum prices for wind energy, significantly above market prices, will be abolished from 2004 and three out of five planned offshore wind parks have been scrapped. "The new offshore wind farms are seen bringing à socioeconomic surplus, even when the economic benefits for the wind power industry is not included," the wise men said in its semi-annual report. The wise men said that Denmarkús investments in wind power over the past 10 years had cost the Danish society net three billion crowns ($373 million). The high wind energy prices have only partly been offset by environmental advantages and related industry activities.
The new government says green energy is denting Danish companies' competitiveness. It also cites the fact that Denmark is ahead of its target for installed wind power capacity, part of à general plan to bring down green house emission in order to comply with the Kyoto climate protocol. By 2003, green energy is seen covering 27 percent of Denmarkús electricity demand compared to à 20 percent target. Denmark plans to build two offshore wind farms in 2002 and 2003 with total capacity of 300 megewatt. Plans of three additional parks of each 150 megawatt has been cancelled. "Even though wind turbines have been loss-making during the past years, wind turbines can be profitable today due to the technological development," the wise menús report said.
Notably increased capacity in turbines have made wind energy more competitive to electricity from fuels like oil and coal. Turbines have grown from à few kilowatts to the megawatt-class and soon the first wind turbine makers will introduce four and five megawatt turbines. "The best wind turbines onshore are probably also economically profitable, but the possibility of further installation is limited, because wind turbines are already placed at the best wind sites," the wise men said.
(Planetark, May 29)
11. The Car Industry Environmental Efforts Summary
TOKYO - Tighter emission rules and worries about dependency on fossil fuels are spurring automakers around the world to develop environment-friendly vehicles.
Following are short explanations of key technologies and major automakers' efforts in the field.
GASOLINE - Automakers are working to improve the traditional internal combustion engine, using technologies like direct injection for fuel delivery that gives better combustion and more fuel-efficient automatic transmissions.
DIESEL - Emitting 20 to 30 percent less carbon dioxide than gasoline engines, diesel engines are popular in Europe. But they emit more nitrogen oxide, nitrogen dioxide and particulate matter, although improved catalysts and particulate filters help.
HYBRID VEHICLES - Cars with à gasoline engine plus à battery-powered motor deliver from 1.5 times to twice the fuel efficiency of vehicles the same size with an internal combustion engine, cutting carbon dioxide emissions. Unlike pure electric vehicles they do not need to be plugged in to be recharged.
FUEL CELL VEHICLES - Fuel cells use an electrochemical process to create electricity by mixing hydrogen with oxygen, only emitting water and heat as by-products. But hydrogen in its natural gaseous state is difficult to store and distribute.
TOYOTA MOTOR CORP - Widely seen as the leader in enviromentally-friendly auto technology, it put the first hybrid gas-electric vehicle, the Prius sedan, on the market in 1997. It aims to put à fuel cell vehicle on the market in 2003 and is strengthening its diesel engine technology. It is also developing auto parts made from bioplastics.
GENERAL MOTORS CORP - The worldús largest automaker expects to have market-ready fuel cells by mid-decade. The first applications will be outside the car industry, with fuel cell-powered vehicles for the retail market not due until 2010. It has outlined plans to offer gasoline-electric engines in cars, trucks and buses, beginning with à pick-up truck in 2004.
DAIMLERCHRYSLER AG - Is focusing on fuel cells and unveiled its first New Electric Car (NECAR) in 1994. In 2000 it brought to market the first limited series of fuel cell vehicles - Mercedes-benz hydrogen city buses. It expects to market its first fuel cell passenger cars in 2004. In 1998 it introduced the two-seater Smart car, which sharply reduced carbon dioxide emissions. It has developed à hybrid version of the Smart car.
HONDA MOTOR CO - The only automaker apart from Toyota to mass-market hybrid vehicles, it has sold some 13,000 hybrids since late 1999. Japanús second-largest automaker plans to put à fuel cell vehicle on the market next year, although it will be using à fuel cell stack from Ballard Power Systems Inc It says, however, that its own stack is nearing completion.
VOLKSWAGEN AG - A pioneer of diesel technology, in 1978 it put its first diesel engine in à passenger car and at the end of the 1980s introduced the more efficient turbo diesel direct injection method. In 1999 VW introduced what it claimed was the worldús first 3-liter car - à Lupo that drove 100km on three litres of fuel. In April 2002 it unveiled the worldús first 1-liter car - à prototype which drives 100 km on one liter of fuel.
FORD MOTOR CO - Will release à hybrid Escape sports utility vehicle (SUV) next year and pledged in 2000 to improve the fuel economy on its Suvs by 25 percent by 2005. In fuel cells, the U.s. automaker has à close relationship with Canadian fuel cell developer Ballard.
(Planetark, May 30)
12. Co-firing of coal with wood and straw – à UK GHG mitigation effort
LONDON - British generators are looking at burning wood and straw with coal at their power stations to cut greenhouse gas emissions and so get valuable green certificates, said Innogy company spokesmen.
"We are looking at the option of wood burning. It would be à mixture - less than 10 percent wood and the remainder coal," said à spokesman at Innogy. The company is seeking permits to carry out trials at various power stations but the main one would be its Tilbury site in south-east England, he said. Another utility Powergen, is also looking at co-firing with wood and straw and is considering growing energy crops like willow for fuel for its plants. "We are looking at co-firing as à first step. Itús early days," said à Powergen spokeswoman.
The plans follow government rules introduced in April which force suppliers to buy at least three percent of their power from green sources, à figure which rises to 10 percent by 2010. Suppliers can prove they have met this target by showing they have renewable obligation certificates (Rocs), either from their own green power production or ones they have bought from renewable generators.
By co-firing, generators will be allowed to issue renewable obligation certificates (Rocs) for the amount of electricity produced by the wood and straw. The government has said it will allow companies to claim Rocs for co-firing production until 2006. Generators like Innogy and Powergen have retail businesses so need the Rocs to cover supplies to their own customers, but they could sell them on the open market. The shortage of green power in the UK means Rocs are worth about 40 pounds ($58.67) per megawatt hour, more than double the value of wholesale electricity. But industry watchers say if co-firing at coal power stations goes ahead it would lead to à huge increase the amount of Rocs available, resulting in à sharp drop in certificate prices.
(REUTERS, June 3)
13. Brazil revives the alcohol motor
RIO DE JANEIRO, Brazil - Legend has it that when alcohol-powered cars became stranded during Brazilús 1989 alcohol fuel supply crisis, desperate motorists tried using strong sugarcane moonshine to keep them running.
They didnút run too well on the homemade liquor, and the "alco car" - one of Brazilús proudest inventions - had such à bad hangover that it nearly fell into oblivion. Sales of the eco-friendly cars, which once represented 90 percent of new passenger vehicle sales in Brazil, dwindled to 1 percent. Turmoil on the world oil market this year due to conflict in the Middle East may prove to be the saving grace for the car that was rolled out after the oil crisis in the 1970s and runs on cane-based 96-proof hydrous ethanol, or alcohol.
Although memories of the 1989 shortage still make most Brazilians skeptical about alcohol-fueled cars, the Brazilian government hopes that signs of international demand for alcohol and prospects for à record harvest in the worldús No. 1 sugar cane grower can bring the vehicle back from the junkyard. "We want to revive the alcohol program. Japan, China and India are seriously thinking about importing alcohol and technologies from Brazil, which has the fame of (being both) pioneer and expert in this sphere," Trade, Industry and Development Minister Sergio Amaral told Reuters. "It doesnút make sense starting it all over again just for exports. It has to be for consumption in our cars too." Leading economies, including the three major Asian powers and the United States, are blending or planning to blend pure, clean-burning alcohol with gasoline in the wake of recent international treaties on greenhouse gas emission reduction. The United States uses ethanol in 12 percent of its fuel, mostly at à blend of 10 percent ethanol. Brazil has been mixing anhydrous ethanol with gasoline for use in all cars for years.
Previous attempts by Latin Americaús largest country to revive the program failed due to alcohol price increases when crops were small, as well as the governmentús clumsy efforts to push automakers into raising output of alcohol-fueled cars. Car producers, who are working at 60 percent of capacity due to à sluggish local economy, now say they are happy to make anything that would sell. But they say it will require tax incentives to overcome consumers' reluctance to buy the cars. Automakers say à hybrid alcohol-gasoline car would be ideal for the market. Fledgling technology known as flex-fuel allows motorists to choose the type of fuel to use depending on the price or other considerations.
Alcohol motors present some drawbacks. Even though alcohol is cheaper than gasoline, it burns more rapidly than the fossil fuel. That means cars fitted with alcohol engines are best equipped with oversize fuel tanks, which cost more. In addition, alcohol-fueled cars need special fuel pumps and injection systems, which make them more expensive to produce. Alcohol cars also donút start well in cold weather.
The government is focusing on the fuel supply side of the problem to ensure that planned strategic stocks of alcohol will bring back consumer confidence and kick-start à revival of the alco-car.
Brazil still has à fleet of some 3 million aging alco-cars and à big alcohol distribution network. "We have à great national asset, which is the enormous network of ethanol filling stations that no other country has," Amaral said.
(by Andrei Khalip and Peter Blackburn, REUTERS, June 3)
14. Everest Glacier Melts, UN Said
GENEVA - A glacier from which Sir Edmund Hillary and Tenzing Norgay set out to conquer Mount Everest nearly 50 years ago has retreated five km (three miles) up the mountain due to global warming, à U.n. body says.
A team of climbers, backed by the United Nations Environment Programme (UNEP), reported after their two-week visit in May that the impact of rising temperatures was everywhere to be seen. The landscape bears the scars of sudden glacial retreat, while glacial lakes are swollen by melted ice, UNEP spokesman Michael Williams told.
During their visit, the team of climbers from the International Mountaineering and Climbing Federation (UIAA) spoke to the head of the Nepal Mountaineering Association, Tashi Jangbu Sherpa, who told them that the ice fields had seen rapid change over the past 20 years.
"He told us that Hillary and Tenzing would now have to walk two hours to find the edge of the glacier which was close to their original base camp," Williams quoted UIAA president Ian Mcnaught-davis as saying. In 1953, New Zealander Hillary and Tenzing, à native of Nepal, became the first climbers to reach the summit of the worldús highest mountain.
UNEP recently warned that more than 40 Himalayan glacial lakes were dangerously close to bursting, threatening the lives of thousands of people, because of ice melt caused by global warming.
(REUTERS, June 7)
15. Mitsubishi Heavy to Recycle CO2
TOKYO - Mitsubishi Heavy Industries Ltd will develop à large plant to recover and recycle carbon dioxide from waste gas, the company sources said.
Mitsubishi Heavy and Kansai Electric Power Co have jointly developed efficient carbon-dioxide recovery technology used to create à plant capable of recovering 2,000 metric tons of carbon dioxide à day. The facility is expected to sell for 7 bln yen. Mitsubishi Heavy hopes to sell two such plants in the Middle East by the end of the current fiscal year. Recovered carbon dioxide can be used for à variety of purposes, including production of urea and methanol.
One of the two facilities Mitsubishi Heavy hopes to sell in the Middle Ease will recover carbon dioxide for use in increased production of crude oil. Mitsubishi Heavy plans to develop by 2010 à plant with the capacity to recover 10,000 tons of carbon dioxide daily.
(Co2e.com, June 6)
16. Prices Grow at the UK Carbon Market
LONDON - Trade in the fledgling UK market in carbon emissions allowances has picked up, with prices rising as companies try to meet targets to cut greenhouse gases, brokers said at à industry conference.
"The last trade was at seven pounds ($10.48) à tonne," said Nicola Steen, vice president of brokers Co2e.com, adding that recent prices had been around six pounds and typical transaction sizes were 5-15,000 tonnes of carbon dioxide equivalent.
"We've seen à significant rise in the price of UK allowances in recent weeks, which has been principally driven by companies with climate change agreements hedging their exposure to losing the rebate," Tim Atkinson, of brokers Natsource, told Reuters. He said the market was now trading daily.
Analysts at the Emissions Trading Stategies conference in London were divided as to which way the price would move. "The climate change levy is an enormous incentive to start trading," said Ian Calvert of British Sugar, adding that at the current price it was much cheaper for companies to buy allowances than risk losing their tax rebate.
But Steen said: "I think the price will go down - thereús potentially large volumes from big companies. "The big players are not doing à lot of trading yet as they are still verifying (their emissions levels)." She said Co2e.com had made the two-day conference "emissions neutral" by estimating energy use at the venue as well as particpants' travel and accomodation, and offsetting this through providing energy efficient light bulbs at some tourism industry sites in Jamaica.
(by Neil Chatterjee, Pkanetark, June 21)