UK energy co-op raises a £quarter million+ in five weeks.

November 26, 2013 Change for Good, Clean Energy, Finance 

SolarPowerPortal: “Brighton Energy Coop has announced that it has raised the £280,000 required for the first phase of its solar project in five weeks.” Read more

Fossil-fuel divestment campaign grows on US campuses.

November 26, 2013 Climate, Coal, Finance, Gas, Oil 

Washington Post: “A divestment movement is marching across U.S. college campuses, borrowing tactics from the 1980s anti-apartheid campaign and using them against oil, gas and coal companies to fight climate change. Students are teaming with investment advisers to convince universities, pension funds and institutional investors that they can take a stand against fossil-fuel companies without hurting their returns.” Read more

Keystone could encourage risky tar-sands investments: Carbon Tracker.

November 25, 2013 Climate, Oil 

Huffington Post: “The Keystone XL pipeline could encourage risky investments in the Alberta oil sands, according to a report released Monday by a climate change think tank.” Read more

Warsaw climate summit ends with commitments to do more homework.

November 25, 2013 Climate 

Guardian: “Weary delegates trudging home from an exhausting and sleep-deprived fortnight of climate change talks in Warsaw may be unwilling to acknowledge it, but the hard work is just beginning.” Read more

Ever more capex for ever fewer barrels: another oil supply warning.

Mark Lewis & Lt Col Daniel Davis in the FT: “The most interesting message in this year’s World Energy Outlook from the International Energy Agency is also its most disturbing. Over the past decade, the oil and gas industry’s upstream investments have registered an astronomical increase, but these ever higher levels of capital expenditure have yielded ever smaller increases in the global oil supply.” Read more

Pension funds on why they are quizzing fossil-fuel bosses re carbon plans.

November 23, 2013 Change for Good, Clean Energy, Climate, Coal, Finance, Gas, Oil 

Thomas P. DiNapoli of the New York State Common Retirement Fund and Anne Stausboll of the California Public Employees’ Retirement System in the Huffington Post:  “….That’s why we, on behalf of two of the world’s largest pension funds, along with 70 leading investors representing $3 trillion in assets, earlier this fall asked the leaders of 45 of the world’s largest fossil fuel companies to assess how their business plans fare in a low-carbon future.”

Read more

SolarCity becomes first US solar company to offer bonds on rooftop solar.

November 22, 2013 Clean Energy, Finance 

Bloomberg: “SolarCity Corp., the first US company to offer bonds backed by rooftop solar panels, plans to sell as much as $200M of additional notes as soon as the second quarter, its CFO said. The company expects subsequent bond offerings as often as every quarter, CFO Bob Kelly said in an interview.” Read more

BHP chair under climate pressure: investing in renewables is “not us”.

November 22, 2013 Climate, Coal, Finance 

The West Australian: “Executives from the world’s biggest mining company, including new chief executive Andrew MacKenzie, rolled into Perth yesterday for its annual meeting in front of about 500 shareholders.” Read more

Big 6 accused of “daylight robbery”: >25% of bills overcharged.

November 21, 2013 Coal, Gas, Nuclear 

Guardian: “Energy companies were accused of “daylight robbery” last night after a survey indicated that more than a quarter of customers are being overcharged through mistakes on their bills. The average error was worth £121 a year in the energy company’s favour, suggesting that errors benefit companies to the tune of at least £650m annually and possibly much more.” Read more

Does Blackstone’s sale of GeoSouthern say anything about peak oil?

November 21, 2013 Gas, Oil 

Christopher Swann in the NYT: “A $6 billion oil deal signals yet another apex for the Blackstone Group. The sale of private equity-backed GeoSouthern Energy to Devon Energy comes at a high price by one important measure. Blackstone, one of GeoSouthern’s owners, also has an uncanny knack for timing. The glut of undeveloped land owned by oil companies suggests finding buyers will get tougher.” Read more

Almost all new US generating capacity added in October is solar.

November 21, 2013 Clean Energy “The U.S. brought online nearly 700 MW of new electricity generation in October, and practically all of it was large-scale solar energy, according to data from the Federal Energy Regulatory Commission’s (FERC) Office of Energy Projects.” Read more

UK government: no more public money for coal in developing countries.

November 20, 2013 Climate, Coal 

Guardian: “British taxpayers’ money will no longer be used to build coal-fired power stations in developing countries, the energy secretary Ed Davey pledged on Wednesday, as the fortnight-long United Nations climate talks entered their final phase.” Read more

Reading between the lines on the IEA’s mix of hype and warnings on oil.

November 20, 2013 Commentaries, Gas, Oil 

Jeremy Leggett & Lt Col Daniel Davis in the Huffington Post: “Last week the International Energy Agency in Paris released its annual World Energy Outlook, which projects energy trends out to 2035. As it did last year, the 2013 WEO had plenty of good news for Americans:”
“The net North American requirement for crude imports all but disappears by 2035 and the region becomes a larger exporter of oil products.” Before we celebrate the end of the Middle East’s dominant role in global energy, however, a quick review of the IEA’s track record on its projections might be in order. Further, an analysis of a few key global oil production factors exposes the unstable foundation upon which hopes for North American oil independence are built.
Following the two global oil crises of the 1970s, the IEA was upbeat about oil supply looking out a quarter century into the future. But the years of relatively easy-to-get, low-priced oil ended in 2004 as oil prices began their ascent to today’s persistently high levels.
Beginning in 2005 and running through 2011, the IEA issued a number of progressively dire warnings about supply that grew increasingly strident as time passed: The 2005 WEO concluded that oil production in non-OPEC countries would reach maximum production “right after 2010,” and that global demand should be reduced urgently. The 2006 WEO issued what the Financial Times called “an apocalyptic warning” about supply disruptions. The 2007 WEO called for “an electroshock,” and emphasized a need “to act immediately and boldly” to reduce the world’s oil demand.
The 2008 WEO reported that world oil production would need to rise to 106 mb/d by 2030 to meet projected demand, the production equivalent of six new Saudi Arabias. This would be extremely difficult, if not impossible, given the decline of mature fields. “What is needed is nothing short of an energy revolution,” the report said. As one of us (Leggett) describes in a new book, IEA officials had little hope that this could be achieved. Several IEA whistleblowers warned that the agency’s production forecast had been deliberately hyped by member governments.
In 2010, shale began to feature increasingly in the IEA’s story, but only as a “game changer” for gas. In 2011, IEA Chief Economist Fatih Birol said in an Australian TV documentary that time was running out for global oil supply. “I think it would have been better if the governments had started to work on it at least 10 years ago,” he said. But in the latter part of 2011, the insistent warnings about future oil supply were swept away and replaced by a thinly supported narrative of fracking-enabled plenty, which was rapidly and enthusiastically embraced by major media outlets and Western publics at large. We need not wonder why.
Man seems psychologically hardwired to prefer good news to bad. But the reality of oil supply and demand fundamentals has not substantively changed since the IEA began issuing its warnings in 2005. As US Energy Information Administration data confirm, global conventional crude oil production did in fact stop growing and flatten out at around 74-75 million barrels a day in 2005 and despite herculean efforts of the most cutting edge technology, has remain essentially flat since. Additional unconventional liquids — which are not equivalent to crude on several important counts — bring the global total to around 90 mb/d today.
How much of the decline in crude production has been counterbalanced by the new US shale oil production to date? The answer is barely 2 million barrels per day — which required more than half the world’s oil rigs outside Russia and China to produce. Worse, detailed studies by shale experts such as Canadian geoscientist David Hughes suggest that oil production from US shale plays cannot increase much more. Nearly all the best spots have already been drilled and, he says, evidence indicates tight production could peak somewhere around 2017. Yet demand continues to rise, driven by the growing economies of China, India and the Middle East. In order to meet it, prices will have to rise higher still, testing the global economy’s ability to sustain growth.
Many governments are pinning their hopes — indeed, some their national economic health — on this feel-good narrative of perpetual abundance, yet which is based on thin evidence and a great deal of industry bluster. We believe that considerable evidence suggests the decline trend in global oil production will resume before the end of this decade. For example, even the otherwise optimistic 2013 WEO made this stunning admission:
“Our analysis of more than 1,600 fields confirms that, once production has peaked, an average conventional field can expect to see annual declines in output of around 6% per year. While this figure varies according to the type of field, the implication is that conventional crude output from existing fields is set to fall by more than 40 mb/d by 2035. Among the other sources of oil, most unconventional plays are heavily dependent on continuous drilling to prevent rapid field-level declines. Of the 790 billion barrels of total production required to meet our projections for demand to 2035, more than half is needed just to offset declining production.”
We contend that growing evidence suggests it is unwise for the United States to stake its energy future on tight oil production continuing at high flow rates and at affordable prices for decades into the future. We recall how those few analysts in 2006 who warned of a looming banking crisis were ignored prior to the collapse, and the considerable price paid by so many when the truth finally imposed itself. In the years following the resulting global recession, Western governments simply printed trillions in bank notes in an attempt to mitigate the disaster. However, once the truth of oil supply and demand imposes itself on the world in the future, we won’t be able to “print” oil; we’ll have to find much more painful ways to adapt to the new reality. We know, as tellers of a story almost no one wants to hear, how difficult our mission is. But the consequences to a world caught unprepared for such an oil crisis are too great to allow us to remain silent.”

Investors demand oil, coal and power companies assess climate risks.

November 20, 2013 Clean Energy, Climate, Coal, Finance, Gas, Oil 

Mindy Lubber & Mark Fulton in the Guardian: “…. it’s not just students and activists clamouring for radical changes; leading corporations and investors are now adding their voices to the chorus calling for stronger action to reduce our fossil fuel dependency.” Read more

Just 90 companies have caused two-thirds of global warming emissions.

November 19, 2013 Climate, Coal, Gas, Oil 

Guardian: “The climate crisis of the 21st century has been caused largely by just 90 companies, which between them produced nearly two-thirds of the greenhouse gas emissions generated since the dawning of the industrial age, new research suggests.” Read more

Philippine typhoon adds drama to 2013 climate summit in Poland.

November 18, 2013 Climate 

Guardian: “In terms of the business of this COP, much of it will be “housekeeping” – clearing the decks on various technicalities so that work can begin soon after on the draft text. But the Warsaw meeting has already provided more drama than was bargained for.” Read more

“Sants’ resignation from Barclays shows pitfalls of poaching”: FT.

November 18, 2013 Finance 

Patrick Jenkins in the FT: “There were plenty of distasteful quips around last week after Sir Hector Sants resigned from Barclays on the grounds of “stress and exhaustion”. Read more

British banks among biggest lenders to coal industry.

November 18, 2013 Climate, Coal, Finance 

Guardian: “Three UK banks are among the world’s biggest lenders to the coal-mining industry, despite trumpeting their environmental credentials, a new report has found.” Read more

“But if the financial crisis taught us anything….”

Margareta Pagano in The Independent: “Jeremy Leggett couldn’t have chosen a better time to warn that we are heading for a world energy crisis so ghastly that the Great Financial Crash will look like a storm in a teacup.” Read more

Philanthropy & risk taking in global energy: challenges, opportunities.

Jeremy Leggett in Alliance magazine:  “In my new book, The Energy of Nations: Risk blindness and the road to renaissance, I argue that the conventional energy industry is repeating the failing. The challenges that this throws up for the philanthropy world are profound. But the opportunities are also substantial.”
….”Most foundations focus their work in the energy arena on climate change and reducing emissions. But the risk taking by the energy incumbency extends across much broader terrain than this, which makes it much more vulnerable than if its collective irresponsibilities were limited to carbon emissions. Let me explain what I mean.
….For years now almost all philanthropists and grantees have focused their efforts on international efforts to curtail emissions. To date this has not achieved the results we want: global emissions have gone on rising. What we have managed to achieve, after the expenditure of much foundation cash, is a degree of better transparency on how much carbon is burned, where and by whom. But this has not slowed the overall emission rate.
Of course, continuing with the same strategies does not guarantee continuing failure. History is not necessarily destiny. But there might be more promising fronts open to us.”
….Encouragingly, some financial institutions have already begun reducing investment in fossil fuels. Examples are the Norwegian insurer Storebrand and the Swedish state pension fund AP4. Others have stayed invested, but are now demanding that cash be deployed not to inflate the carbon bubble but as dividends: money paid back to investors so that they can invest it in something more useful and more profitable if they wish.
Growing numbers of people think that this line of attack is more likely to achieve a breakthrough on climate change. It is very different from pressuring companies and governments to measure emissions. It aims to divert, and ultimately turn off, the dysfunctional river of capital flowing to carbon. This is an area ripe for foundation support.
….”Even if the US shale phenomenon isn’t a bubble, is it an exportable phenomenon? Given the emerging environmental downsides, the water resource requirements, and other factors, almost certainly not.
….There is great scope for the philanthropy world to foster debate over systemic risks such as this – some foundations are already actively funding projects in this area. It is distressing how easily the energy incumbency pushes comforting narratives out to receptive ears in government, the corporate world, and the public.
….”There were few whistleblowers in the run-up to the financial crash, and they were vilified. Today ‘peakists’ – believers in premature peak oil – tend to be shunned by most players, including foundation funders. This needs to change: softening the blows from an oil shock involves the same tools as abating climate risk.
My parents’ generation amazed themselves at how fast they could mobilize tanks, fighters, bombers, warships – not to mention millions willing to drive them – under the gun. If we were to repeat that level of application, we could abate much of the horror that the IPCC warns of, and soften the inevitable shock/s. There is much the philanthropy world can do to prepare for this day – not least in going beyond the distribution of grants to the reinvestment of their endowments.
As I explain in my book, I expect we will have only one chance to get this right next time around.”