Smog around climate change III : Dimming is back!

Does China really care about climate change and not only on air pollution? According to LI Yijing[i] there is no doubt. After her presentation[ii] on March 11^th, 2016 at PolyU HK, she just replied “yes of course!” to my question, without any other attempt to justify her very confident answer. It is probably true that China (i) would like to be the leader in something like reducing global warming and (ii) already suffers from the adverse consequences of climate change, but it is even more convincing to observe that China faces an air pollution catastrophe and should urgently deal with it. And this is my concern.

Fighting air pollution implies reducing SO2, one of the 6 air pollutants entering the Air Quality Index as computed by China's Ministry of Environmental Protection (MEP), others being ozone, lead, carbon monoxide, nitrogen oxides and PM. It is one of the 6 major air pollutants as listed by the EPA as well. SO2 is a gas produced from burning coal, mainly in thermal power plants. There is scientific evidence proving that short-term exposure to SO2 (from 5mn to 24h) causes adverse respiratory effects.  SO2 is affecting radiative forcing as well but in a surprising way: due to a dimming effect it is actually cooling the climate!

A recent paper published in Nature[iii] argue that if SO2 emissions were to go back to their 1980 level China contribution to radiative forcing of the climate would be 13%+/- 4% instead of the current 10+/-4%. In fact, in China, the cooling effect of SO2 (-0.11 Wm^-2radiative forcing) currently nearly compensates for the warming effect of CH4 (0.13 Wm^-2radiative forcing). This illustrates the “masking” effect of cooling aerosols such as sulphated ones. And China is effectively reducing these emissions. During the 10^th Five-Year Plan period (2001-2005) the MEP set a goal to reduce SO2 emissions by 10% by 2005 compared to 2000. It was not achieved, but there is a significant decline starting after 2005 (around 10% between 2006 and 2008, according to Lu et al. 2010)[iv], In the same paper, authors stress that whether an air quality improvement in China occurring through SO2 emissions reduction would imply a rise of China’s contribution to the global radiative forcing depends on the reduction of other pollutants such as ozone precursors and black carbon that may be co-emitted and have a warming effect. But what I noticed[v] is that Particulate Organic Matters are cooling the climate as well…

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[i] China Executive Leadership Academy Pudong, Shanghai, 201204; liyijing@celap.org.cn

[ii] https://esscaeu-public.sharepoint.com/Research%20%20Activities%20%20Publications/Workshops%20on%20EU-Asia%20Relations%20in%20Global%20Politics/Papers%20-%205th%20Workshop%20on%20EU-Asian%20Energy%20&%20Climate%20Policy/3.2.LI-Yijing-China%E2%80%99s%20Policies%20and%20Actions%20for%20Addressing%20Climate%20Change.pdf

 

[iii] “The contribution of China’s emissions to global climate forcing” , by Bengang Li, Thomas Gasser, Philippe Ciais, Shilong Piao, Shu Tao, Yves Balkanski, Didier Hauglustaine, Juan-Pablo Boisier,  Zhuo Chen, Mengtian Huang, Laurent Zhaoxin Li, Yue Li, Hongyan Liu, Junfeng Liu, Shushi Peng, Zehao Shen, Zhenzhong Sun, Rong Wang, Tao Wang, Guodong Yin, Yi Yin, Hui Zeng, Zhenzhong Zeng & Feng Zhou, Nature 531, p357-362  January 2016. http://www2.centre-cired.fr/Actualites/article/The-contribution-of-China-s-emissions-to-global-climate-forcing-2197?lang=fr

 

[iv] Lu Z, Streets D.G., Zhang Q., Wang S., Carmichael G.R., Cheng Y.F., Wei C., Chin M., Diehl T., and Tan Q. (2010), “Sulfur dioxide emissions in China and sulfur trends in East Asia since 2000”Atmospheric Chemistry and Physics, 6311-6331.

[v] See figure 1 p358.

COP21 in Paris: Are promises better than nothing?

Prudence Dato, prudence.dato@univ-savoie.fr, IREGE/University of Savoie (France)

  

Before submitting to the assembly for final agreement, the President of COP21, Laurent Fabius declared with emotion that the compromise text is “fair, sustainable, dynamic, balanced and legally binding”. However, it seems to be very difficult to find how it is legally binding by reading the final agreement.[1] But there are nice promises. The agreement that was unanimously voted confirms the goal of maintaining the increase in average temperature to 2°C below the pre-industrial average (the 1850-1900 reference period) and intends to pursue efforts to limit this increase to 1.5°C. This limit of 1.5 °C would require negative emissions that suppose a quick transition to renewable energy and energy efficiency; and the adoption of biofuels combined with carbon capture and storage (CCS) technologies according to the Intergovernmental Panel on Climate Change (IPCC) mitigation pathways. While the group of developing countries, which include most vulnerable countries and also both less and more polluting countries like China and India supports this target, its requirements are less favorable to them. For instance, biofuels are competitive with food production[2] and may reduce their possibilities to reduce poverty[3], while developing countries are most affected by both climate change and poverty.  Also, up to now the CCS technologies are too costly[4] and renewable energy is not affordable in developing countries[5]. This would not be possible unless there is a transfer of technologies and financial aids.

 These issues of transfer of technologies and financial aids were also important parts of the COP21 agreement. Fund of $100 billion a year was promised by developed countries to support climate policies in developing countries such as conservation and sustainable management of forests and promotion of renewable energy through new aids or greening existing ones[6]. Additionally, there were side commitments from some countries like France and US.  For instance, France has decided to cut subsidies for overseas coal-fired power stations without a CCS and has promised €2 billion by 2020 to African countries. Also by the year 2020, the United States has promised to double its funding from $430 million in 2014, for poor countries to help them adapt to the effects of climate change. But all this is only promises…In addition, developing countries may be careful of the euphoria of green that may redirect aids to green projects which may not socially efficient instead of investing in development projects such as infrastructures, education, health, etc. Overall, nothing will happen if developed countries do not fulfill their promises…and why would they? Even worse: even if developing countries really receive the $100 billion, will they have any incentive to reduce their GHG emissions? No sign of that in China or Hong Kong.

 

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[1] http://unfccc.int/resource/docs/2015/cop21/eng/l09r01.pdf

[2] For more details, see Condon, Nicole, Heather Klemick, and Ann Wolverton. "Impacts of ethanol policy on corn prices: A review and meta-analysis of recent evidence." Food Policy 51 (2015): 63-73.

[3] https://www.foreignaffairs.org/articles/2007-05-01/how-biofuels-could-starve-poor

[4]http://www.iea.org/publications/freepublications/publication/technologyroadmapcarboncaptureandstorage.pdf

[5] Martinot, Eric, Akanksha Chaurey, Debra Lew, José Roberto Moreira, and Njeri Wamukonya. "Renewable energy markets in developing countries*."Annual Review of Energy and the Environment 27, no. 1 (2002): 309-348.

[6] http://unfccc.int/resource/docs/2015/cop21/eng/l09r01.pdf

COP21, peak oil and climate policy implementation

COP21, peak oil and climate policy implementation

Surprisingly, there are still engineers who seem to be concerned about the peak oil. Jean-Pierre Jancovici - well-known in French media- made a speech last month at¹ BaptistU in Hong Kong that was mainly on peak oil but with some slides on the textbook IPAT identity² at the end of his presentation in order to reach a climax in the drama: this is the end of growth because we are depleting of oil and on the top of that, he argued, populations are going to be decimated as it is the only way to satisfy the IPAT identity.

Usually I ask such pessimistic speakers how many kids they have to check the consistency of their thinking³... Instead, I made him address the following question: “Which constraint on fossil fuels do you think is the most stringent: the one on climate change or the one exhaustibility?” Indeed the two issues are in some sort mutually exclusive: being short of oil makes it easier to cope with climate change, as less GES will be created. At least, the two problems are not reinforcing each other. He did acknowledge that it was climate change even if he seems convinced that running out of oil is already in the countries’ growth figures (or will be soon…that was not entirely clear to me).

Having engineers now convinced that climate change is the issue number one, should we be optimistic about climate policies that will be implemented in the near future? Nowadays, economists know quite well which environmental policies could allow reaching the first best (or nearly). However, they are hardly implemented. There has been a lot of talking, a lot of debates and a lot of events around COP21. It will now start soon (some will say it is already finished since to avoid a “Copenhagen scenario” a lot of things have been decided in advance) and one may wonder what to expect.

Many people do not expect that much. First note that COP21 implies that 20 COPs already happened! Second, each negotiator’s first objective is to secure the lowest targets possible for his/her country while the second one is to congratulate all participants at the end of the event for such time, energy and money devoted to trying and solve the climate change issue. This is mainly communication. However, climate change is a global issue and there is no way to avoid international negotiation. As a reaction to the expected statu quo, some economists have therefore called for a uniform carbon price in view of COP21. The rationale was to propose a very simple instrument that would then be easier to implement. However it seems quite far form a first best situation. Also note that in Hong Kong, there is nearly no environmental policy (except some environmental education). At the 4th Nobel Laureates Symposium on Global Sustainability, 22-25th April 2015, Christine Loh (under Secretary for the Environment in Hong Kong) publicly said "We now know what we should do but we cannot do it. Anybody who has any ideas should help us". It seems that the main problem is implementation, or political acceptability. Why not design an environmental economics that explicitly accounts for political constraints? For the time, let’s hope COP21 will turn out more ambitious than we thought!

1 The event was co-organized by CEFC. http://www.cefc.com.hk/fr/event/how-does-the-energy-crisis-influence-the-world-economy-and-the-geopolitical-ecosystem/

2 For a refresher: http://www.ipcc.ch/ipccreports/sres/emission/index.php?idp=50

3 Having written a book entitled “Climate change explained to my daughter”, we can infer he has at least one.

The inconvenient truth about China and air pollution in Hong Kong

On june16th, the Environmental Protection Department (EPD) of Hong Kong published the 2013 Emission Inventory for Hong Kong (one would have expected the 2014 one…). According to this report, Hong Kong's total emissions in 2013 were 31 280 tonnes of SO₂, 113 220 tonnes of NO_x, 29 420 tonnes of VOC and some tonnes of other dirty gazes (details can be found there). It is advocated that compared to 2012, the levels of the six major pollutants in 2013 were between 1 and 11 per cent lower, mainly due to a reduction in emissions from vessels and motor vehicles.

But are HK emissions important for HK air pollution? Depending on who you speak with (people who own a car, people from the government, MTR users etc…) the answer does vary. In fact the usual suspect for HK air pollution is mainland China. And the usual answer when you do not have conflict of interest nor any particular information is 50% is coming from HK emissions and 50% is coming from mainland China.

At the School of Energy and Environment, Dr. Nicky Lam and Glory Kwok Lee Kan who is a PhD student have carefully addressed the subject, and are developing a new statistical model to predict the air quality in Hong Kong as well as the source of this pollution. Interestingly, the PM10 mainly come from mainland China (80% in January!). But it is not always true: from May to September included, more than 50% of PM10 are generated by Hong Kong. These are not the most heavily polluted months but it is also true for February and March. Last but not least, HK has to be taken responsible for most NO₂ and SO₂ generation.

And now guess what Hong Kong is doing? Quietly waiting for mainland China to do the job in emission reduction. But with this information about air pollution sources, HK SAR authorities have now to seriously consider doing something too. Which means ultimately understand that pollution is an externality generated by economic activity and is an issue that, by definition, cannot be spontaneously addressed by the market.

The renewable war: geopolitics of a transition towards a green economy.

Prudence Dato (IREGE/ University Savoie Mont Blanc)

Recently, the Australian prime minister’s chief business adviser, Maurice Newman, the chairman of Tony Abbott’s business advisory council has accused the United Nations (UN) of using climate change science to lead a new world order, while Ms Figueres, the top UN climate negotiator is visiting Australia to urge the country to move away from heavily polluting coal production[1]. Although Newman’s statements are habitually provocative and climate change skeptical[2], this questions the geopolitics’ issues of a transition to a green economy.  Geopolitics’ considerations could hinder the transition to a green economy in the sense that energy transition may affect international relations between energy producers and energy consumers by creating a new world order.

The geopolitics of renewable energy may depend on the scarcity of rare minerals that are needed to produce renewable energy[3] and also on innovation in renewable energy technologies.  For instance, China has monopole (97%) on rare earth elements[4], which are critical for the production of renewable energy equipment.  Then an economy that relies on the sole use of renewable energy will give more power to China while it reduces that of the countries that currently dominate oil market. Although the energy transition can potentially improve social welfare, some countries (those having rare mineral resources) are winner while others (those having only oil for instance) are loser. In this regard, one needs to consider those disparities when negotiating international agreements on climate change. Otherwise, some countries may not keep their promises or may not even make promises on reducing or on eliminating their dependency on polluting sources of energy. What if international agreements consider the redistribution of the gain from energy transition to compensate the losers?

Are rare materials enough to dominate the new world order of renewable energy?  Renewable energy is also capital-intensive and its production efficiently depends on innovation. As a result, countries that are not endowed with rare minerals, can count on their capital and /or their investment in innovation. Concerning capital, USA and Germany were the countries that invested the most in 2008 respectively in new clean technologies and in classical renewable equipment (photovoltaic solar panels combined with wind energy). And Germany develops innovation as well as it owned the highest share (24%) of the awarded patents in the wind energy-industry between 2001 and 2005, while in the solar energy-industry Japan owned the highest share (50%) of all patents[5]. Without efficient exploitation of the rare minerals resources to produce the renewable energy, energy transition could not be sustainable[6] and could generate reverse results in the long term. Hence, investments should be more dedicated to innovation so that the transition to a green economy makes less pressure on rare materials and becomes economically, environmentally and socially efficient. 

 But as countries will have to secure energy that is important to support their economic growth, they will explore all the possible means to efficiently get renewable energy. Then, those countries endowed with rare materials, or those having appropriate innovation to produce renewable energy with less cost or those having capital to invest more in renewable energy can probably dominate the new world order. This may well generate political conflicts or war depending on the power concentration. How will poor countries without endowment, capital or innovation act in this new world order?

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[1] http://uk.reuters.com/article/2015/05/08/climate-change-australia-idUKL4N0XZ1I220150508

[2] http://www.theguardian.com/australia-news/maurice-newman

[3] For more details, see the previous post on: http://ethkf.blogspot.fr/2014/12/is-renewable-energy-really-inexhaustible.html

[4] de Ridder, Marjolein. The Geopolitics of Mineral Resources for Renewable Energy Technologies. The Hague Centre for Strategic Studies, 2013.

[5] Criekemans, David. "The geopolitics of renewable energy: different or similar to the geopolitics of conventional energy?." ISA Annual Convention. 2011.

[6] Vidal, Olivier, Bruno Goffé, and Nicholas Arndt. "Metals for a low-carbon society." Nature Geoscience 6.11 (2013): 894-896.

 

Green is the new black

It was unrealistic, it is now fashion.  Lack of realism came from the higher cost of electricity generated by renewables. But now you can find studies concluding that it is no longer the case. For the “fire reinventer” Amory Lovins (read his book “Reinventing fire” or watch his TED conference)[i] it is possible for the US to have a 2.6× bigger economy in 2050 with no oil, coal, or nuclear energy, one-third less natural gas, 82–86% lower carbon emissions, tripled end-use efficiency, and 74% renewable supplies.

 More recently the French Agency ADEME[ii] released a report that is an atomic bomb for France where brand new nuclear power plants are supposed to be built. Actually it is not officially released but you can find it on Mediapart[iii] or summarized in Le Monde[iv] . The main idea is that renewables are not more expensive than nuclear. It is only valid under some scenarios (in particular on demand management) and requires a careful mix but it would not be impossible.  The cost would notably be a convex function of the percentage of renewables implying for instance that electricity cost is lower for 95% of renewables than for 40%.

What about intermittency? Well, Amory Lovins would correct you by stating that renewables are variable not intermittent since predictable and therefore easy to tackle. Even if there is some predictability in wind and sun I do not think weather is perfectly known in advance and even variability is not that easy to compensate for. This is a problem that Germany is already facing and I had a chance to attend a seminar given at CityU HK in March 2015 by researchers from the Chair of Energy Economics (EE2)[v]  at the University of Dresden and from that of Karlsruhe Institute of Technology (KIT)[vi]. Not only are they concerned with not having enough wind or sun when there are demand peaks but they also study what to do to with  excess supply off-peak. Surprisingly they recommend export and storage but curtailing is relevant option as well, due to its lower cost in terms of grid extension and storage. Also note that exports put some stress on the electricity markets of importing countries (how could Switzerland then use its hydro to exploit demand peaks?). Researchers at EE2 also pay attention on the way uncertainty on renewable energy sources has affected different electricity markets and how forecast errors on the renewable energy sources can be tackled. Electricity balancing is the process through which the transmission system operators ensure that they are able to access a sufficient amount of energy to balance the differences between supply and demand that occur in every electricity transmission system. They show that wind and solar should be integrated in balancing markets to add flexibility and allow for forecast errors compensation. This could even strengthen renewable energy integration.

Quite convincingly, the ADEME report has successfully checked the robustness of a 100% electricity generation using renewable, to extreme weather events. And of course a mix of storage capacities (including pumped hydroelectric storage Mr Lovins does not like –hydro is for baseload in his mix- and Switzerland could think of to recycle its capacity) are needed and should be carefully designed for the costs not to be inflated too much. In his TED conference, Amory Lovins keeps saying sun and wind have the lowest marginal cost of energy generation (well, everybody would agree that once solar panels and wind power plants are installed wind and sun are not really expensive). The ADEME report focuses a lot on electricity generation capacity using renewable sources but, at least in the final report, the cost computations (including those of storage capacities) are not a lot detailed. And Germany is thinking about reducing feed-in tariff that helped so much solar energy development.

Anyway, considering the problem in the reverse way has never been so relevant: why not designing the optimal fully green electricity generation (whatever the remoteness of the future) and then design how to optimally get there rather than groping period by period to introduce a little bit of renewable with no idea of the big picture?  The ADEME report obtains a ratio of 1 for sun to 4 for wind when there is 80% renewables (also obtained for Germany by Fraunhofer Institute)[vii]. Any guess for Hong Kong?

 

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[i]               http://www.ted.com/talks/amory_lovins_a_50_year_plan_for_energy?language=en

[ii]               www.ademe.fr

[iii]              http://www.mediapart.fr/journal/france/080415/energie-le-rapport-cache-sur-une-france-100-renouvelable

[iv]              http://www.lemonde.fr/planete/article/2015/04/09/une-france-avec-100-d-electricite-renouvelable-pas-plus-couteux-que-le-nucleaire_4613278_3244.html

[v] www.ee2.biz
[vi]http://www.iip.kit.edu/english/65.php

[vii] EnergieWirtschaftliche Bedeutung der Offshore WindEnergie fûr die EnergieWende, Fraunhofer IWES, 2013

Transition to renewable energy: not quick but better if people are frightened

Prudence Dato, prudence.dato@univ-savoie.fr, IREGE/University of Savoie (France)

The latest climate change news includes both new engagements and enforcement of existing engagements. For instance, the new US commitment aims at reducing their emissions up to 40% (from 2008 to 2025), and increasing up to 30% the share of electricity from clean energy sources. Also, the European Union (EU) leaders agreed to develop innovative strategies for a new generation of renewable energies and increase energy efficiency through the European Energy Union, while China found it more interesting to enforce existing pollution regulation than taking new engagements.[1] However, the full energy transition maybe hindered by some constraints such as the availability of inputs (mostly rare materials) and the need of fossil fuels to produce solar panels or wind turbine as a self-reproducing photovoltaic cells or wind turbine is not possible.

Dato (2015)[2] considers the issue of energy transition in a theoretical growth model that involves both the decision of renewable energy adoption and that of investment in energy saving technologies. The results suggest that the sole adoption of the renewable energy is optimal only in the long run. This result is in line with the asymptotic energy transition argument that states that the transition to "clean" energy only happens in the long run. It may be a consequence of the impossibility of self-reproducing renewable energy. As the economy still needs fossil fuels to produce clean energy, it is efficient to progressively replace fossil fuels with a clean source of energy. Then, a quick and full energy transition is not optimal for the economy, and one should not expect any immediate transition to an economy that only uses renewable sources of energy. Dato (2015) suggests that economic instruments such as taxes on the "dirty" energy or subsidies on the "clean" energy should be designed to meet the requirements of a transition to a sole use of "clean" energy in the long run.

The results of the study also show that the economy that fears pollution is more favorable to the energy transition. This suggests that people must be more sensitized about the potential consequences of their use of fossil fuels. Clearly the “Under the Dome” video[3] does the job for China. What for Europe? For several hours on Wednesday last week, Paris was declared the most polluted city in the world. Scary isn’t it? Well, mainly due to exceptionally good weather conditions in Shanghai…and although car driving is banned on alternate days in Paris, there is still a lack of explanation and of sensitization.

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[1] See previous post in this blog (http://ethkf.blogspot.fr/2015/03/is-china-saving-world.html).

[2] P Dato (2015). Energy transition under irreversibility: a two-sector approach. FAERE Working Paper, 2015.05.

[3]  https://www.youtube.com/watch?v=T6X2uwlQGQM