EU Industry pledges no new coal plants as Australians mobilize to fight the giant Adani coal project

The Union of the Electricity Industry (EURELECTRIC), representing 3500 companies across Europe, released a statement on April 5, pledging that no new coal-fired plants will be built in the EU after 2020.   “The European electricity sector believes that achieving the decarbonisation objectives agreed in the Paris Agreement is essential to guarantee the long-term sustainability of the global economy. EURELECTRIC’s members are committed to delivering a carbon neutral power supply in Europe by 2050, and to ensuring a competitively priced and reliable electricity supply throughout the integrated European energy market.” Poland and Greece remain outside the agreement, and apparently outside the mainstream.

The Guardian calls the EU position   a “death knell for coal”,    and in a separate piece, summarizes the decline of coal-fired electricity around the world.  “Coal in ‘freefall’ as new power plants dive by two-thirds”  (March 22)    quotes a new report by Greenpeace  , Sierra Club USA,  and Coalswarm   :  Boom and Bust 2017: Tracking The Global Coal Plant Pipeline.   Its findings show a 62 percent drop in new construction starts, and an 85 percent decline in new Chinese coal plant permits. A senior Greenpeace official states: “2016 marked a veritable turning point”.  “China all but stopped new coal projects after astonishing clean energy growth has made new coal-fired power plants redundant, with all additional power needs covered from non-fossil sources since 2013. Closures of old coal plants drove major emission reductions especially in the U.S. and UK, while Belgium and Ontario became entirely coal-free and three G8 countries announced deadlines for coal phase-outs.”

Stop-Adani-LogoYet in Australia, environmentalists are waging an epic environmental battle against a giant, $16.5-billion coal mine adjacent to the Great Barrier Reef, proposed by Indian energy conglomerate Adani. Government supporters, including the Prime Minister and politicians in Queensland, have argued that the mine would bring jobs and would not increase GHG emissions globally because Australian coal is cleaner than any other that India would be able to source from other countries; see an article in Climate Home for the rebuttal to that.  Voices in opposition include Bob Brown, a former Green Party leader, who states  : “This is the environmental issue of our times and, for one, the Great Barrier Reef is at stake. The Adani corporation’s dirty coalmine is an impending disaster with effects which will reach far beyond Australia.”  Or read:   “It’s either Adani or the Great Barrier Reef – are we willing to fight for a Wonder of the World?”   in The Guardian.   Thirteen community groups, claiming to represent 1.5 million Australians have joined the Stop Adani Alliance since its launch in March, and the Australian Conservation Foundation is behind another high-powered campaign . For context, see “The coal war: Inside the fight against Adani’s plans to build Australia’s biggest coal mine” from the Sydney Morning Herald.   For a catalogue of “the ten most-absurd things about the Adani mine ” , see “Australia’s Climate bomb: the senselessness of Adani’s Carmichael coal mine”    in The Conversation (April 12).

UPDATE:  An April 24 analysis  of the bleak prospects of the Carmichael Mine proposed by Adani for Australia  “Adani: Remote Prospect: Carmichael Status Update 2017”  .

Is Europe on track to meet its Paris commitments? Is Canada?

Carbon Market Watch released a policy briefing report in March which found that only Sweden, Germany and France are making successful efforts towards meeting their Paris Agreement targets.   EU Climate Leader Board: Where Countries Stand On The Effort Sharing Regulation – Europe’s Largest Climate Tool  ranked the EU nations  for their actions towards meeting the Effort Sharing Regulation (ESR), currently under negotiation  to set binding 2021-2030 national emission reduction targets for sectors not covered in the Emission Trading Scheme (ETS), including transport, buildings, agriculture and waste.    “Only three member states on track to meet Paris goals“, appeared  in the EurActiv newsletter, summarizing  the report and pointing  to many failings by member nations, including some “who exploited loopholes in United Nations forestry rules to pocket carbon credits worth €600 million”.   The National Observer noted the Climate Market Watch report in “Here`s How Europe ranks in the race against climate change” ,  and  asks “Where does that leave Canada?” .  As part of its own answer, the article  cites a report in The National Post newspaper on March 30: “Secret briefing says up to $300-per-tonne federal carbon tax by 2050 required to meet climate targets” . The article is based on a briefing note to the Minister of  Environment and Climate Change in November 2015, obtained through a Freedom of Information request.  The briefing note tells the Minister that in order to meet Canada’s 2030 emissions targets, a carbon price of $100 per tonne would need to be in place by 2020, with a price as high as $300 per tonne by 2050. The current national price for those provinces who agreed to the the Pan-Canadian Framework is $10 per tonne, rising to $50 per tonne by 2022.

Another  answer to the question, “where does that leave Canada?”  might  be the report released by Environment and Climate Change Canada: Canadian Environmental Sustainability Indicators: Progress Towards Canada’s Greenhouse Gas Emissions Reduction Target , which shows that Canada could be emitting at least 30% more GHG emissions than promised by 2030.  The report, however, is based on the policies in place as of November, 2016 –  before the current Pan-Canadian Framework on Clean Growth and Climate Change.  The government is downplaying its own report, calling it only a set of “plausible outcomes”, rather than a forecast.

 

 

 

 

European Union votes on reforms to Emissions Trading System

On February 15, the European Parliament adopted draft reforms of the EU’s emission trading system (ETS), the centrepiece of European emissions reduction policy – choosing the less ambitious proposal of a reduction on the cap on emissions of only 2.2% per year until at least 2024. Climate Action Network Europe’s  Letter to Policymakers   ahead of the vote outlined the arguments and proposals for environmentally-ambitious change, including a higher price on carbon and inclusion of the cement, aviation and shipping industries. Its reaction after the vote   stated: “It is shocking that the Parliament chose to bow to the interests of polluting industries instead of protecting citizens from a catastrophic climate breakdown. The Parliament has completely failed the first test of its commitment to the Paris Agreement. The proposed reforms will keep the carbon market ineffective for a decade or more. We urge progressive EU governments to finally turn the ETS into a functioning tool and create a stimulus to ditch old models and move to green economy.”    One of the  three reforms urged by 31  environmental organizations in  an Open Letter to the MEP’s in November 2016 had been the establishment of the Just Transition Fund for  communities and regions which need support to transition away from coal.  The reforms will be debated next at the Council of Environment Ministers on 28 February; the  EU’s 28 governments must negotiate further to finalize the legislation.

Canada Pension Plan Investment Board lags international financial community on recognition of climate change risks and stranded assets

In what the WWF has called   “a landmark moment for responsible investment in Europe” , the European Parliament voted in November 2016  to mandate that all workplace pension administrators must consider climate risk and risks “related to the depreciation of assets” -stranded assets-  in investment decisions.  It also requires greater transparency about investment policies. Individual governments of the EU now have two years to pass into national law this updated version of the  existing Institutions for Occupational Retirement Provision (IORP) Directive. Currently, the directive would affect occupational pension plans affected covering approximately 20% of the EU workforce, mostly in the United Kingdom, the Netherlands, and Germany .  A September 2016 Briefing Note from the European Parliament  details the administrative/political evolution of the Directive; a December  article from Corporate Knights  or  Go Fossil Free or Reuters  provide summaries.

In December 14, 2016, the Task Force on Climate-Related Financial Disclosure, chaired by Michael Bloomberg,  released its report and recommendations  to the Financial Stability Board, a G-20 organization chaired by Mark Carney. An article by the two men appeared in The Guardian, capturing the gist of the work:  “We believe that financial disclosure is essential to a market-based solution to climate change. …. A properly functioning market will price in the risks associated with climate change and reward firms that mitigate them. As its impact becomes more commonplace and public policy responses more active, climate change has become a material risk that isn’t properly disclosed.” The Task Force calls for companies to make voluntary disclosure of climate risks to their business,  to help  investors, lenders and insurance underwriters to manage material climate risks, and ultimately to make the global economic and financial systems more stable.   A 60-day public consultation period began with release of the report; an updated report, incorporating that input,  will be released in June 2017.  The Task Force report was summarized in   “Climate disclosure framework creates a better environment for investors” in the  Globe and Mail Bloomberg News also reported on another recommendation, “Carney Panel Urges CEO Compensation Link With Climate Risk ” , stating that the time has come for organizations to provide detailed reporting of how manager and board member pay is tied to climate risks.  (See a Dec. 1 Reuters article about Royal Dutch Shell’s moves to link CEO bonuses to GHG reduction).

In Canada, the Canada Pension Plan Investment Board, which administers the assets of the national public pension fund, seems to be standing on the sidelines.  A recent article in the Globe and Mail was written by the director of the CPPIB Sustainable Investment department , which is described in  more detail in their 2016 Report on Sustainable Investing . The report states (page 11)   “ CPPIB has established a cross-departmental Climate Change Working Group to consider how physical risks, as well as technological, regulatory and market developments will impact climate change-related risks, and create opportunities, in the future. …. This review, which will take some time, is being done from a long-term perspective in light of how the gradual transition to a lower-carbon global economy might unfold….  On the topic of divestment and climate change, research has shown that investors with longer horizons tend to be more engaged with the companies that they invest in, and CPPIB is a case in point. As responsible owners, we believe that in many cases selling our shares to investors who might be less active in terms of considering material risks, including climate change, would be counterproductive.”   In light of this very slow approach, Friends of the Earth (FOE) has been frustrated in its divestment campaign for the CPPIB in 2016 ;  FOE maintains a petition website, Pensions for a Green Future, which calls for the CPPIB to, among other things,  “report immediately to its 19 million members on the carbon footprint and exposure to climate solutions of our CPP investment portfolio” and “to replace climate polluting investments with those in green energy, technologies and infrastructure that support Canada’s commitment to act to avoid 1.5°C of warming.” The CPPIB discloses the companies it is invested in here  .

In contrast to the CPPIB, the Caisse de dépôt et placement du Québec (CDPQ),  the second largest pension fund manager is Canada,  is highlighted in a new report by the World Economic Forum  as “ one of the most important institutional investors in wind power” for its investment of  close to $2.5 billion (US) in both onshore and offshore wind projects in Europe and North America, starting in 2013 with a tentative investment in the Invenergy , and now including the London Array wind farm in the outer Thames estuary.  The Caisse statements on environmental and social responsibility are here ; it is a signatory to the U.N.  Principles for Responsible Investment (PRI), a member of the Carbon Disclosure Project and the Carbon Water Disclosure Project, and endorses the Extractive Industries Transparency Initiative , which monitors the oil and gas industry .

EU trade unions and the transition to low carbon industry: an opportunity to create jobs

In introducing a new report on October 5, the Confederal Secretary of the European Trade Union Confederation (ETUC) said, “Most trade unions see the transition to low-carbon industry as an opportunity to create industrial growth and jobs, but many workers understandably fear widespread job losses.”  The report, Industrial regions and climate policies: towards a just transition? , summarizes the results of questionnaire sent to ETUC affiliates in 17 countries. 31 responses were received, and the report provides case studies from  seven, in the following  regions: Yorkshire and the Humber in the UK, North Rhine Westphalia in Germany, Asturias in Spain, Antwerp area in Belgium, Norbotten in Sweden, Stara Zagora in Bulgaria, and Silesia in Poland. They generally provide an overview of the low-carbon policies of unions, government policies, and union involvement with policy formation in each region.  Overall in the EU, responses indicated  trade unions were involved in the development process of a national industrial strategy  in 75% of cases, usually through tripartite bodies.   There were few responses regarding training initiatives.  In conclusion, the ETUC  calls for a socially just transition to low-carbon economy which will include consultation and participation of trade unions and employers to  manage decarbonization of industry; accelerated deployment of breakthrough low-carbon technologies; investment in skills for a socially just transition to a low-carbon economy;  attention to the social impacts of decarbonization .

This report updates the information from a 2014 report, and is the result of a two-year research project.