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Why gas is not green



There is a growing enthusiasm for natural gas as a relatively low-carbon fuel, with the government in the UK looking to emulate the US shale gas revolution. Seb Beloe of WHEB Asset Management asks, “Is gas really a green fuel?

There is no doubting the growing momentum building behind natural gas as a source of energy. The chancellor George Osborne is keen to position the UK as a ‘gas hub’ and provide generous tax breaks to encourage the industry, the International Energy Agency (IEA) has proclaimed a new ‘golden age of gas’ and all the old oil and gas companies are now reinventing themselves as ‘gas and oil’ companies.

This enthusiasm is becoming more and more evident in sustainable investing as well. The respected sell-side analyst teams at Cheuvreux and Citi have recently published reports proclaiming the benefits of natural gas as part of the ‘green economy’. Citi in a report dated September 12 2012 describes the relationship between shale gas and renewables as ‘symbiotic’, with gas providing back-up generation capacity when intermittent renewables fail to deliver.

As of May 31 2013, at least two climate change focused funds held shares in BG Group: F&C’s Global Climate Opportunities Fund as a top 10 holding and the Schroder Global Climate Change Fund as a the top three holding.

But is natural gas really a ‘green’ option? Certainly it is true that efficient combined cycle gas turbines (CCGT) are able to generate power with approximately half the carbon intensity of even the most efficient coal-fired power plant. However, some forms of gas production – particularly shale gas – are thought to generate significant additional greenhouse gas emissions through fugitive methane emissions during extraction and production.

The precise amount of leakage is in debate. Several studies suggest emissions more than offset the carbon benefits of gas power; others suggest the emissions just reduce the overall benefit.

While most resistance to shale gas has come from the environmental impact of ‘fracking’, including from fugitive methane emissions, we are more concerned that support for natural gas will displace renewables with a consequent impact on greenhouse gas emissions resulting from gas power generation.

Fatih Birol, the IEA’s chief economist, argues that governments are actively moving to foster support for gas as a source of power in preference to renewables. A move away from renewables would, Birol said, increase the risk of ‘catastrophic’ climate change.

In the UK, the independent Committee on Climate Change also reached a similar conclusion, arguing that a move to gas-fired power generation would undermine reductions in carbon emissions unless carbon capture and storage (CCS) technology is deployed on all new gas-fired power plants from 2020.

The average emissions intensity of UK power generation today is about 450g of carbon dioxide equivalents per kilowatt hour (CO2e/Kwh). According to the committee, by 2030, for the UK to stay on track for overall carbon reductions by 2050, this will need to be approximately 50g of CO2e/Kwh. Gas power has an intensity of approximately 390g of CO2e/Kwh, demonstrating just how limited the space for unabated gas power is in the UK in 2030.

The precise trajectory of emission reductions varies by geography of course, but, as the IEA has pointed out, Natural gas is not the answer” as the emissions per Kwh from an average gas-fired plant will be higher than the average global CO2 intensity in electricity generation by as early as 2025 if emission reductions targets are achieved.

Natural gas-fired power plants will of course still have a role, but only in backing up renewable generation. On this basis, and assuming that climate change objectives are to be met, the report concludes that there are questions around the long-term viability of some of the gas infrastructure investment that has taken place in recent years.

The enthusiasm that is being displayed for natural gas by the oil and gas companies and their supporters is to be expected. BG, Shell and BP are still selling products that are carbon intense. They call for more natural gas as ‘a bridge to a low carbon future’, conveniently defending business as usual.

In our view, unless the gas is coming from non-fossil sources and/or carbon capture and storage is installed on gas powered generation, then natural gas does not represent a ‘solution’ to the problem of climate change. In the words of Jeremy Leggett the Chairman of Solarcentury, “Gas isn’t a bridge to a low-carbon future, it is just a bridge to a gas future.”

Seb Beloe is a partner and head of sustainability research at WHEB Asset Management. This is an updated version of an article that originally appeared on WHEB’s blog in October 2012.

Further reading:

Gas: earthquakes, explosions and energy

Fracking firms warned over risks after report suggests it could reduce bills

UK shale gas reserves could exceed expectations

Too early to say’ whether fracking will reduce bills, say MPs

The Guide to Limitless Clean Energy 2013

Articles, features and comment from WHEB Group, an independent investment management firm specialising in opportunities created by the global transition to more sustainable, resource efficient economies. Posts are either original or previously featured on WHEB’s blog or in its magazine, WHEB Quarterly.


How Going Green Can Save A Company Money



going green can save company money
Shutterstock Licensed Photot - By GOLFX

What is going green?

Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.

The first step in going green

There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.

Making needed changes within the company

After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.

Reducing the common paper waste

paper waste

Shutterstock Licensed Photo – By Yury Zap

Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.

Make money by spreading the word

Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.

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5 Easy Things You Can Do to Make Your Home More Sustainable




sustainable homes
Shutterstock Licensed Photot - By Diyana Dimitrova

Increasing your home’s energy efficiency is one of the smartest moves you can make as a homeowner. It will lower your bills, increase the resale value of your property, and help minimize our planet’s fast-approaching climate crisis. While major home retrofits can seem daunting, there are plenty of quick and cost-effective ways to start reducing your carbon footprint today. Here are five easy projects to make your home more sustainable.

1. Weather stripping

If you’re looking to make your home more energy efficient, an energy audit is a highly recommended first step. This will reveal where your home is lacking in regards to sustainability suggests the best plan of attack.

Some form of weather stripping is nearly always advised because it is so easy and inexpensive yet can yield such transformative results. The audit will provide information about air leaks which you can couple with your own knowledge of your home’s ventilation needs to develop a strategic plan.

Make sure you choose the appropriate type of weather stripping for each location in your home. Areas that receive a lot of wear and tear, like popular doorways, are best served by slightly more expensive vinyl or metal options. Immobile cracks or infrequently opened windows can be treated with inexpensive foams or caulking. Depending on the age and quality of your home, the resulting energy savings can be as much as 20 percent.

2. Programmable thermostats

Programmable thermostats

Shutterstock Licensed Photo – By Olivier Le Moal

Programmable thermostats have tremendous potential to save money and minimize unnecessary energy usage. About 45 percent of a home’s energy is earmarked for heating and cooling needs with a large fraction of that wasted on unoccupied spaces. Programmable thermostats can automatically lower the heat overnight or shut off the air conditioning when you go to work.

Every degree Fahrenheit you lower the thermostat equates to 1 percent less energy use, which amounts to considerable savings over the course of a year. When used correctly, programmable thermostats reduce heating and cooling bills by 10 to 30 percent. Of course, the same result can be achieved by manually adjusting your thermostats to coincide with your activities, just make sure you remember to do it!

3. Low-flow water hardware

With the current focus on carbon emissions and climate change, we typically equate environmental stability to lower energy use, but fresh water shortage is an equal threat. Installing low-flow hardware for toilets and showers, particularly in drought prone areas, is an inexpensive and easy way to cut water consumption by 50 percent and save as much as $145 per year.

Older toilets use up to 6 gallons of water per flush, the equivalent of an astounding 20.1 gallons per person each day. This makes them the biggest consumer of indoor water. New low-flow toilets are standardized at 1.6 gallons per flush and can save more than 20,000 gallons a year in a 4-member household.

Similarly, low-flow shower heads can decrease water consumption by 40 percent or more while also lowering water heating bills and reducing CO2 emissions. Unlike early versions, new low-flow models are equipped with excellent pressure technology so your shower will be no less satisfying.

4. Energy efficient light bulbs

An average household dedicates about 5 percent of its energy use to lighting, but this value is dropping thanks to new lighting technology. Incandescent bulbs are quickly becoming a thing of the past. These inefficient light sources give off 90 percent of their energy as heat which is not only impractical from a lighting standpoint, but also raises energy bills even further during hot weather.

New LED and compact fluorescent options are far more efficient and longer lasting. Though the upfront costs are higher, the long term environmental and financial benefits are well worth it. Energy efficient light bulbs use as much as 80 percent less energy than traditional incandescent and last 3 to 25 times longer producing savings of about $6 per year per bulb.

5. Installing solar panels

Adding solar panels may not be the easiest, or least expensive, sustainability upgrade for your home, but it will certainly have the greatest impact on both your energy bills and your environmental footprint. Installing solar panels can run about $15,000 – $20,000 upfront, though a number of government incentives are bringing these numbers down. Alternatively, panels can also be leased for a much lower initial investment.

Once operational, a solar system saves about $600 per year over the course of its 25 to 30-year lifespan, and this figure will grow as energy prices rise. Solar installations require little to no maintenance and increase the value of your home.

From an environmental standpoint, the average five-kilowatt residential system can reduce household CO2 emissions by 15,000 pounds every year. Using your solar system to power an electric vehicle is the ultimate sustainable solution serving to reduce total CO2 emissions by as much as 70%!

These days, being environmentally responsible is the hallmark of a good global citizen and it need not require major sacrifices in regards to your lifestyle or your wallet. In fact, increasing your home’s sustainability is apt to make your residence more livable and save you money in the long run. The five projects listed here are just a few of the easy ways to reduce both your environmental footprint and your energy bills. So, give one or more of them a try; with a small budget and a little know-how, there is no reason you can’t start today.

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