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German Solar Subsidies Are Questioned

Frank Asbeck, CEO of Solarworld AG, one of the Germany's top makers of photovoltaics, is suggesting that the country sharply reduce its generous solar subsidies. His proposition is controversial and does not appear to be widely supported among the country's other leading PV manufacturers. But it could have some resonance with Angela Merkel's conservative government, which consolidated its position notably in last week's national election. One immediate effect of that victory is likely to be reconsideration and possibly even the repeal of Germany's nuclear energy phase-out plan--Merkel has long advocated an "exit from the nuclear exit." Another could be a reduction in solar subsidies which free marketeers dislike almost by definition, and which appear now to be helping Chinese PV makers more than German.

Before the election, Germany's parliament decided to shave solar subsidies by 8-10 percent over the next three years. Asbeck has suggested cuts of about 15 percent, to be coupled with stricter quality and environmental requirements for photovoltaics exported to Germany.

 

BYD Owner Is China's Richest Man

Wang Chuanfu, owner of BYD, has gone from being China's 103-richest man to being first, according to a report this week in the Financial Times. BYD, besides being a major world supplier of lithium ion batteries, has got into hybrid-electric car manufacturing in a big way, and has announced its intention of becoming China's and then the world's largest car maker. The company got a big boost a year ago when Warren Buffett's Berkshire Hathaway took a 10 percent stake in the company. (The value of that stake has gone in the meantime from $230 million to $1.7 billion, making it one of Buffett's more successful recent investments.)

The second richest person on the China list is a woman whose family owns the country's leading paper recycling and packing company, prompting comments on the prominence of green technology enterprises among the leading Chinese enterprises. However, the owners of two top solar companies--LDK Solar and Suntech--dropped out of the top ten:  

 

France Unveils Ambitious EV Charging Plan

The French ecology minister, flanked by the CEOs of Renault and Peugeot Citroen, announced plans this week to build the infrastructure needed to support up to 2 million electric and hybrid cars by 2020. A million battery charging points are to be deployed by 2015, in parking lots, private homes, and roadside stations; from 2012 on, all new apartment buildings with parking lots will be required to include charging stations. Some of the 1.5  billion euros allocated to the plan also will go to support R&D on batteries and advanced cars.

The plan, coming hard on the heels of President Sarkozy's carbon tax, is expected to unleash in France a "battle of the electric cars" among the nation's major manufacturers.

 

Iran Nuclear Fallout

About this time six years ago, I happened to find myself in the back of a Washington D.C. taxicab with Robert Einhorn, who had been in charge of nuclear non-proliferation efforts in the Clinton administration. I fished an IAEA report out of my briefcase documenting twenty years of secret Nonproliferation Treaty violations by Iran. Why, I asked Einhorn, had Iran concealed so much activity from the International Atomic Energy Agency, considering that all the activity would have been legal if Iran had just openly declared it?

"Because it's a nuclear weapons program," Einhorn said (with an air of talking to somebody who might be mentally retarded). It was as if he was echoing the famous Clinton campaign mantra, "It's the economy, stupid."

That conversation prompted me to make a trip to Vienna to visit the IEAE and write an investigative feature about Iran's program. One point made in that article: the U.S. government, having flubbed badly on alleged Iraqi weapons of mass destruction, might now err in the opposite direction on Iran. 

Though the Obama administration is taking a very tough line on the secret Iranian facility, there are some signs our concerns may have been valid as far as the U.S. intelligence community is concerned. For several years U.S. intelligence has taken the position that Iran terminated efforts to develop a nuclear warhead design, and has not resumed them. But according to a report this week in The New York Times, Israeli intelligence believes that Iran has resumed with weapon design efforts, and German intelligence believes the Iranians never stopped such work in the first place.

France's foreign minister Bernard Kouchner, a human rights activist whose roots are in the French left, has accused the IEAE of concealing evidence of an Iranian weapons design effort.

A number of years ago, the neoconservative political scientist Robert Kagan wrote a widely noted book in which he postulated that Europeans are from Venus, Americans from Mars. But on the question of Iranian nuclear weaponization, it would appear that Europeans are more from Mars, Americans more from Venus.

German Election A Likely Reprieve for Nuclear

Germany's election this weekend could save nuclear energy's neck, at least in Europe, thanks to the decisive re-election of Chancellor Angela Merkel and her center-right Christian Democratic Union. It may not be enough to secure the nuclear industry's troubled renaissance, as poster-child projects bog down in delays and cost overruns. But Merkel could keep Germany's reactors operating for another 15 years or so beyond the 2022 deadline set under her predecessor and erstwhile coalition partners, the Social Democrats.

"German poll gives mandate to delay nuclear phaseout" is the clarity with which Reuters presented the election's energy implications in an article yesterday. That is surprising, given the extensive coverage given by German media to a supposed upwelling of antinuclear sentiment in the weeks leading up to the election.

The revival of concerns over nuclear energy's safety were sparked by allegations of government misconduct in the planning for a controversial permanent storage site for high-level waste. Outgoing environment minister Sigmar Gabriel, a Social Democrat, leaked documents suggesting that Merkel's predecessors had tried to cover up the potential that radioactivity from the site, a former salt mine, could leak into groundwater. Germany newsweekly Der Spiegel warned that the "damaging revelations" had "rekindled political debate about atomic energy in Germany" and might cost Merkel the election.

Apparently they were wrong, for Merkel beat the Social Democrats so decisively that she can now government without them. Many Germans seem to accept the conclusion of our feature on "Germany's Green Energy Gap": even this world leader in renewable energy is not installing wind power and solar energy fast enough to replace the 25% of its electricity supplied by nuclear reactors.

Nor will the German public support unfettered installation of new coal-fired power plants. Just this month a German court ordered energy giant E.on to halt construction of a 1.1 gigawatt coal-fired power plant in Datteln, in which it has already invested €600 million ($880 million).

As the Times of London notes in an editorial today entitled "Merkel Unleashed", there seems to be no way around keeping the nukes going: "Unless the life of some of the nuclear plants is prolonged, the country will become yet more dependent on Russian gas and energy imports."

China and India Give Ground on Climate

This week, the International Energy Agency delivered the startling news that China’s greenhouse gases declined sharply this year and that the country "will be at the forefront of combatting climate change by 2020 if it meets government targets," as the Financial Times put it in a pre-release report about a forthcoming IEA study. The IEA found that emissions are down generally, largely as a result of the global recession, but also because of policies in several key regions: the European Union's effort to cut emissions 20 percent by 2020, tightening U.S. standards for automotive fuel efficiency, and Chinese energy efficiency programs.

IEA Chief Economist Fatih Birol said that if China achieves its 2020 efficiency targets, "it will be the country that has achieved the largest emissions reductions."

The sharp drop in global greenhouse gas emissions, yet to be definitively quantified, is itself a positive development, in that it will make it easier to negotiate further reductions in emissions at the upcoming Copenhagen climate conference. In meetings here in New York City this week, there was evidence the gap between the advanced industrial countries and the rapidly industrializing countries might be narrowing. A speech by Chinese President Hu Jintao at the United Nations was generally hailed for its positive tone, even though he declined to make any specific numerical commitments. Even more significant (if much less widely reported) was a signal from India indicating it might be ready to set numerical targets for its greenhouse gas emissions, having always said previously it would not accept such targets.

To judge from reporting experience on the ground in India and  China, concern about climate change is higher in those countries than one might suppose. Ten years ago, developing a special report for IEEE Spectrum magazine about the "dilemma of coal-fired power" in the two countries, this blogger found a surprisingly high level of awareness and concern among government officials in Beijing. Partly that reflected a closely related concern about the health effects of coal plant pollution: hundreds of thousands of Chinese die from exposure to the pollution each year, making this a public health crisis. And that's by no means the only and possibly not even the most serious aspect of emissions and climate change. Five years later, reporting at article for Spectrum about a big dam on the Yellow River, I was surprised to discover that the river was drying up--the result of a long drought in the Tibetan highlands, probably aggravated by global warming. 

China and India are both highly agricultural countries with billions of mouths to feed. The medium-term effects of climate change in both countries could be devastating.

Constructive Ideas for Copenhagen Conference

This week, with world leaders meeting in New York, and with just three months to go until the global climate conference in Copenhagen, Columbia University hosted a series of speeches and panel discussions on climate. In a kind of keynote, Kofi Annan had the following to say:

"As we approach Copenhagen, there appears to be an emerging consensus that global emissions be cut 50 percent from 1990 levels by 2050. But that's not enough. Industrialized nations need to find innovative ways to reduce emissions dramatically, within the range of 25-40 percent by 2020.…The big emerging economies such as Brazil, China, India, South Africa and Mexico…must lower emissions relative to a 'business as usual' scenario."

Here's why this is significant and useful. As countries prepare to meet in Copenhagen to draft a follow-on agreement to the Kyoto Protocol, there is wide concern the conference could fail--and that failure, like that of tariff and reparations conferences in the 1920s, could be catastrophic for the whole world. Failure is feared mainly because of U.S. insistence that the fast developing countries must agree to emissions reductions, which they are absolutely unwilling to do, and because of wide unhappiness about the United States.

Countries like China and India are convinced they cannot afford to constrain economic growth in the near term, and that it's unreasonable for countries that use energy and emit carbon much more recklessly to make such demands on them. As for the United States, though it is talking a pretty good game when it comes to the long run, it has been pretty slippery about what it actually will do in the next decade.

So, as a compromise between  those seemingly unbridgeable differences, Kofi Annan proposes that the advanced industrial countries undertake sharper reductions in the decade immediately to come, and that the fast developing countries undertake to reduce emissions relative to what they would have been if business were to proceed as usual.

That leaves open the question of when countries like China will be in a position to actually reduce absolute levels of emissions, as Denmark's Minister of Climate and Energy Connie Hedegaard observed in a panel. Hedegaard, who will chair the Copenhagen meeting, makes a tough, no-nonsense impression; a recent newspaper profile of her says her objective in Copenhagen will be to make the price too high for any country that tries to block an emerging consensus. Hedegaard said yesterday that she will be looking to hear from China in December in what year exactly the country’s carbon emissions will peak.

Energy Efficiency Is Best Policy

OK. it's special pleasing by an organization that has a stake in the outcome. But still, the results of the ACEEE study released yesterday are plausible and important to always bear in mind, as the United States contemplates how to reduce dependence on fossil fuels and cut carbon emissions. Generally the cheapest way to do that, says ACEEE, is to improve the efficiency with which energy is used throughout the economy rather than increase the amount of energy delivered. In the electricity sector, it says, the cost of acquiring an added widget of efficiency has held fairly steady during the last five years  at about 2.5  cents per kilowatt-hour, while costs for new coal- or nuclear-generated electricity have gone up, along with virtually all other generating costs.

Generally, claims ACEEE, new generation will cost three or four times as much as improved  conservation.

If you want to know precisely how ACEEE arrives at those figures don't ask me. Read the report.

Big Solar Project Collides with Conservationism

BrightSourceEnergy Inc is dropping plans to build a 500 MW thermal solar generating plant in the Mojave Desert. The plant, consisting of reflectors and a central tower that would have covered 5,130 acres, was slated for a remote area that President Clinton had promised to protect in perpetuity but which his successor President Bush offered to open to developers. Though Brightsource and its thermal concentrating technology have supporters among environmentalists, California Sen. Dianne Feinstein has been pushing to declare the area affected by the project a national monument.

The area became the property of the Federal government, as it happens, only after the Wildlands Conservancy raised forty million dollars to purchase it and then donated it to the government. Until recently, other solar developers reportedly also were eyeing the property, including Stirling Energy Systems, Solel, Nextlight, and Cogentrix Energy. Brightsource still hopes to build a 400 MW thermal solar plant elsewhere in the Mojave, with Bechtel as prime contractor.

On Sept. 22, barely a week after its shelving the 500-MW Mojave project, BrightSource announced it has reached preliminary agreement with Nevada's Coyote Springs Land Company providing sites for up to 960 MW of solar thermal energy for the California and Nevada markets. The expanded site northeast of Las Vegas will cover 12 square miles and include residential and commercial elements, besides concentrator arrays. It expands on an earlier land agreement between BrightSouce and Coyote allowing for 600 MW of thermal solar generation.

According to BrightSource, the Nevada site and solar projects already have received environmental permits from the federal Bureau of Land Management and the U.S. Fish and Wildlife Service. The 400 MW Ivanpah project in the Mojave is under final review by t he California Energy Commission and the Bureau of Land Management, and construction could begin as early as 2010. 

Those Natural Gas Image Ads

If you're a reader of U.S. newspapers, you may be wondering why you're seeing full-page ads sponsored by the natural gas industry telling you that "the success of wind and solar energy depends on natural gas." (It's because when the sun goes down and the wind stops blowing we need some other relatively low-carbon fuel to generate our electricity.) But you already knew that, right?

When listening to a Yankees game in New York City you'll find the action is often interrupted by plugs for the Indian Point Nuclear Power plant. That makes sense. We all know that reactors can melt down or even blow up, that their waste stays radioactive for hundreds of thousands of years, that terrorists could extract weapons material from waste to make an atomic bomb or just use the waste raw to make a dirty bomb, and that wayward states like Iraq or Iran might build supposedly peaceful reactors for sinister military purposes. So the industry has an obvious stake in reminding us that nuclear energy can still be useful and a net plus under some circumstances.

The same goes for coal. Emissions from its combustion kill an estimated 30,000 people in the United States each year. At both the front end and back end of the fuel cycles coal creates enormous physical quantities of waste, which are often not adequately contained. Strip mining lays waste to West Virginia mountaintops and Montana vistas.  Though there aren't a lot of people engaged in deep sub-surface mining any more, some of them still die every year. And generating electricity with coal accounts for two-fifths of U.S. carbon emissions. So it's scarcely surprising that the coal industry has been saturating the airwaves in recent years with ads telling us that dirty coal is really clean.

But natural gas? Why does the natural gas industry need to remind us that it's relatively clean and low-carbon?

The reason, I gather from scattered news commentaries and a barrage of direct communications from the natural gas industry, is that gas feels it is not getting a fair enough shake in prospective U.S. climate & energy legislation. Why does it feel that way? Don't ask me. I simply can't stand the thought of delving into the details. This is because, to manipulate a phrase of Bismarck’s that was once memorably mangled by former president George W. Bush, I've seen too much of what goes into the sausage of climate policy to voluntarily inspect any more.

That is, I'm fed up with policy that reflects a balance of contending vested interests rather than recognized national imperatives and proved best practices.

Once upon a time, back in the days when many Americans began to wonder what kind of president would succeed the younger Bush, I dreamt we might be blessed with one who had JFK’s knack for getting in front of a microphone and saying to the American public: This is what the situation is, and this is what the situation requires; and so this is what we are going to do, and this is how we're going to do it.

I dreamt the new president might say something like: "The evidence is in, the science is real. [Obama actually did say that shortly after taking office.] To protect the world and get into step with international efforts, we need to cut U.S. carbon emissions 50 percent by 2050. [That actually is the administration's stated policy.] To do that, we need to start cutting emissions sharply right now, so that they'll be 20 percent lower by 2020, in line with what Europe is doing. [Ouch! Is this getting too specific?] Accordingly, we are going to enact a carbon tax that will make the cost of coal-generated electricity about 50 percent more expensive and average retail electricity prices about 25 percent  higher. [What??] Everybody will have an incentive to use energy more sensibly. Generators will switch from high carbon fuels like coal to low carbon fuels like natural gas and zero-carbon electricity sources like nuclear, hydro, solar, and wind. [Well, that could make sense.]

"We will recognize [the new president continues] that some regions and lower-income groups will be adversely affected, and so we shall take measures to protect them. But we will not make any special deals with industry groups or specific companies. The energy business has had a decade and a half to see this coming, and in many cases shareholders have told corporate directors to get ready. So industry groups need not use proceeds from energy sales to buy image ads. They can use that money, instead, to adjust to the new realities of the world."

Of course life is never so simple. Even in country like France, with its Napoleonic tradition of rational, scientific management, when its president introduced a carbon tax recently, instead of its being greeted as a logical conclusion from first principles, it was universally condemned as either too much or too little. Sarkozy, instead of reaping the credit he expected from environmentalists, was chewed to pieces by everybody from left to right.

Still, wouldn't it be nice if, just once and a while, we could make policy strictly on the basis of recognized ends and more efficient and effective means?

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