Connect with us

Economy

Citi, Morgan Stanley and Bank of America top funders of coal, says report

Published

on

Citi, Morgan Stanley and Bank of America have topped a new ranking of commercial banks on the extent to which they finance coal mining projects. The trio have collectively pumped over €21 billion (£17.6 billion) into the industry since 2005.

According to a new report by a coalition of European non-governmental organisations, while 89 banks have funded coal projects to the tune of €118 billion (£98 billion) in the eight years to mid-2013, the top 20 funders account for 71% of this. This equates to around €83.8 billion (£70.1 billion).

Banking on Coal, by campaign groups including BankTrack, Urgewald and the World Development Movement (WDM), adds that since 2000, coal production has grown by 70%. This is despite it being among the most polluting fossil fuels.

Coal is killing the climate, and banks are fuelling the boom”, said Nick Dearden, director of the WDM. He added that any hopes of limiting the global average temperature increase to 2C – the threshold agreed by governments – will be a “fantasy” while banks continue to fund the coal industry at current levels.

Analysis by the Carbon Tracker Initiative suggests that the majority of current known fossil fuel reserves – somewhere between 60-80% – is classified as “unburnable” if the 2C warming limit is factored in.

Top 20 Coal Mining Banks (Click to enlarge)

One of the ways in which investors are beginning to get their arms around [carbon] is to do some more sophisticated analysis of what the spectrum is, and then pick off the more extreme parts of it”, said Seb Beloe, head of sustainability at WHEB Asset Management.

“Given where we are with the science around climate change, and indeed even the policy that is being developed in response to it, you have to be pretty brave or pretty foolhardy to believe that things aren’t going to get tighter for that most extreme end of the carbon spectrum over the next 10, 20 or 30 years.”

He added, “It may feel like today these are legitimate investments, but in a way that’s not the question you should be asking. The question is whether or not they will continue to be legitimate in 10 years, let alone 30 years. We think that prudent, risk-averse investors will absolutely think twice before they invest in those sorts of assets.”

Mark Hoskin, a partner at London-based financial advisory firm Holden & Partners, said there were a number of reasons for why the finance world continued to fund fossil fuels. These include: investors not being fully aware of the long-term financial impacts of climate change; the “unsophisticated” financial models currently in play; and what he called a “sheep mentality”, where governments and communities want fossil fuels today and if banks and investors do not help finance this, somebody else will.

The undeveloped world has an insatiable thirst for energy as it tries to improve the quality of life of its populations”, Hoskin said.

Fossil fuels are the only short-term solution to give it sufficient power, fast enough to drive its economies forward and to help develop its communities. International action on the price of carbon has not been solid enough to alleviate this problem.

The amount of money pouring into equity markets and from banks clearly demonstrates that the investment community does not believe that climate change will alter the value of carbon assets within the timeframe of their investment horizons.”

The Banking on Coal study places four UK banks in the top 20 most prolific coal lenders and underwriters in the world: the Royal Bank of Scotland (eight), Barclays (12), HSBC (15) and Standard Chartered (18).

Yann Louvel of BankTrack, who analysed the banks’ policies on coal financing, said, “Banks finally need to face up to the real-world impacts of their financing decisions. When they finance companies that blow up mountaintops or destroy jungles to extract coal, they have a responsibility for these impacts.”

Further reading:

Investors worth $3tn put pressure on fossil fuels industry to rethink future

The other reason for divestment

Pension headache: why we need our funds to go on a fossil fuel diet

‘Urgent action’ required to protect pension savings from climate change

The Guide to Climate Change 2013

Economy

Will Self-Driving Cars Be Better for the Environment?

Published

on

self-driving cars for green environment
Shutterstock Licensed Photo - By Zapp2Photo | https://www.shutterstock.com/g/zapp2photo

Technologists, engineers, lawmakers, and the general public have been excitedly debating about the merits of self-driving cars for the past several years, as companies like Waymo and Uber race to get the first fully autonomous vehicles on the market. Largely, the concerns have been about safety and ethics; is a self-driving car really capable of eliminating the human errors responsible for the majority of vehicular accidents? And if so, who’s responsible for programming life-or-death decisions, and who’s held liable in the event of an accident?

But while these questions continue being debated, protecting people on an individual level, it’s worth posing a different question: how will self-driving cars impact the environment?

The Big Picture

The Department of Energy attempted to answer this question in clear terms, using scientific research and existing data sets to project the short-term and long-term environmental impact that self-driving vehicles could have. Its findings? The emergence of self-driving vehicles could essentially go either way; it could reduce energy consumption in transportation by as much as 90 percent, or increase it by more than 200 percent.

That’s a margin of error so wide it might as well be a total guess, but there are too many unknown variables to form a solid conclusion. There are many ways autonomous vehicles could influence our energy consumption and environmental impact, and they could go well or poorly, depending on how they’re adopted.

Driver Reduction?

One of the big selling points of autonomous vehicles is their capacity to reduce the total number of vehicles—and human drivers—on the road. If you’re able to carpool to work in a self-driving vehicle, or rely on autonomous public transportation, you’ll spend far less time, money, and energy on your own car. The convenience and efficiency of autonomous vehicles would therefore reduce the total miles driven, and significantly reduce carbon emissions.

There’s a flip side to this argument, however. If autonomous vehicles are far more convenient and less expensive than previous means of travel, it could be an incentive for people to travel more frequently, or drive to more destinations they’d otherwise avoid. In this case, the total miles driven could actually increase with the rise of self-driving cars.

As an added consideration, the increase or decrease in drivers on the road could result in more or fewer vehicle collisions, respectively—especially in the early days of autonomous vehicle adoption, when so many human drivers are still on the road. Car accident injury cases, therefore, would become far more complicated, and the roads could be temporarily less safe.

Deadheading

Deadheading is a term used in trucking and ridesharing to refer to miles driven with an empty load. Assume for a moment that there’s a fleet of self-driving vehicles available to pick people up and carry them to their destinations. It’s a convenient service, but by necessity, these vehicles will spend at least some of their time driving without passengers, whether it’s spent waiting to pick someone up or en route to their location. The increase in miles from deadheading could nullify the potential benefits of people driving fewer total miles, or add to the damage done by their increased mileage.

Make and Model of Car

Much will also depend on the types of cars equipped to be self-driving. For example, Waymo recently launched a wave of self-driving hybrid minivans, capable of getting far better mileage than a gas-only vehicle. If the majority of self-driving cars are electric or hybrids, the environmental impact will be much lower than if they’re converted from existing vehicles. Good emissions ratings are also important here.

On the other hand, the increased demand for autonomous vehicles could put more pressure on factory production, and make older cars obsolete. In that case, the gas mileage savings could be counteracted by the increased environmental impact of factory production.

The Bottom Line

Right now, there are too many unanswered questions to make a confident determination whether self-driving vehicles will help or harm the environment. Will we start driving more, or less? How will they handle dead time? What kind of models are going to be on the road?

Engineers and the general public are in complete control of how this develops in the near future. Hopefully, we’ll be able to see all the safety benefits of having autonomous vehicles on the road, but without any of the extra environmental impact to deal with.

Continue Reading

Economy

New Zealand to Switch to Fully Renewable Energy by 2035

Published

on

renewable energy policy
Shutterstock Licensed Photo - By Eviart / https://www.shutterstock.com/g/adrian825

New Zealand’s prime minister-elect Jacinda Ardern is already taking steps towards reducing the country’s carbon footprint. She signed a coalition deal with NZ First in October, aiming to generate 100% of the country’s energy from renewable sources by 2035.

New Zealand is already one of the greenest countries in the world, sourcing over 80% of its energy for its 4.7 million people from renewable resources like hydroelectric, geothermal and wind. The majority of its electricity comes from hydro-power, which generated 60% of the country’s energy in 2016. Last winter, renewable generation peaked at 93%.

Now, Ardern is taking on the challenge of eliminating New Zealand’s remaining use of fossil fuels. One of the biggest obstacles will be filling in the gap left by hydropower sources during dry conditions. When lake levels drop, the country relies on gas and coal to provide energy. Eliminating fossil fuels will require finding an alternative source to avoid spikes in energy costs during droughts.

Business NZ’s executive director John Carnegie told Bloomberg he believes Ardern needs to balance her goals with affordability, stating, “It’s completely appropriate to have a focus on reducing carbon emissions, but there needs to be an open and transparent public conversation about the policies and how they are delivered.”

The coalition deal outlined a few steps towards achieving this, including investing more in solar, which currently only provides 0.1% of the country’s energy. Ardern’s plans also include switching the electricity grid to renewable energy, investing more funds into rail transport, and switching all government vehicles to green fuel within a decade.

Zero net emissions by 2050

Beyond powering the country’s electricity grid with 100% green energy, Ardern also wants to reach zero net emissions by 2050. This ambitious goal is very much in line with her focus on climate change throughout the course of her campaign. Environmental issues were one of her top priorities from the start, which increased her appeal with young voters and helped her become one of the youngest world leaders at only 37.

Reaching zero net emissions would require overcoming challenging issues like eliminating fossil fuels in vehicles. Ardern hasn’t outlined a plan for reaching this goal, but has suggested creating an independent commission to aid in the transition to a lower carbon economy.

She also set a goal of doubling the number of trees the country plants per year to 100 million, a goal she says is “absolutely achievable” using land that is marginal for farming animals.

Greenpeace New Zealand climate and energy campaigner Amanda Larsson believes that phasing out fossil fuels should be a priority for the new prime minister. She says that in order to reach zero net emissions, Ardern “must prioritize closing down coal, putting a moratorium on new fossil fuel plants, building more wind infrastructure, and opening the playing field for household and community solar.”

A worldwide shift to renewable energy

Addressing climate change is becoming more of a priority around the world and many governments are assessing how they can reduce their reliance on fossil fuels and switch to environmentally-friendly energy sources. Sustainable energy is becoming an increasingly profitable industry, giving companies more of an incentive to invest.

Ardern isn’t alone in her climate concerns, as other prominent world leaders like Justin Trudeau and Emmanuel Macron have made renewable energy a focus of their campaigns. She isn’t the first to set ambitious goals, either. Sweden and Norway share New Zealand’s goal of net zero emissions by 2045 and 2030, respectively.

Scotland already sources more than half of its electricity from renewable sources and aims to fully transition by 2020, while France announced plans in September to stop fossil fuel production by 2040. This would make it the first country to do so, and the first to end the sale of gasoline and diesel vehicles.

Many parts of the world still rely heavily on coal, but if these countries are successful in phasing out fossil fuels and transitioning to renewable resources, it could serve as a turning point. As other world leaders see that switching to sustainable energy is possible – and profitable – it could be the start of a worldwide shift towards environmentally-friendly energy.

Sources: https://www.bloomberg.com/news/articles/2017-11-06/green-dream-risks-energy-security-as-kiwis-aim-for-zero-carbon

https://www.reuters.com/article/us-france-hydrocarbons/france-plans-to-end-oil-and-gas-production-by-2040-idUSKCN1BH1AQ

Continue Reading
Advertisement

Facebook

Trending