rising subsidiesRich countries are subsidising oil, gas and coal companies by about $88bn (£55.4bn) a year to explore for new reserves, despite evidence that most fossil fuels must be left in the ground if the world is to avoid dangerous climate change.

The most detailed breakdown yet of global fossil fuel subsidies has found that the US government provided companies with $5.2bn for fossil fuel exploration in 2013, Australia spent $3.5bn, Russia $2.4bn and the UK $1.2bn. Most of the support was in the form of tax breaks for exploration in deep offshore fields.

The public money went to major multinationals as well as smaller ones who specialise in exploratory work, according to British thinktank the Overseas Development Institute (ODI) and Washington-based analysts Oil Change International.

Britain, says their report, proved to be one of the most generous countries. In the five year period to 2014 it gave tax breaks totalling over $4.5bn to French, US, Middle Eastern and north American companies to explore the North Sea for fast-declining oil and gas reserves. A breakdown of that figure showed over $1.2bn of British money went to two French companies, GDF-Suez and Total, $450m went to five US companies including Chevron, and $992m to five British companies.

Britain also spent public funds for foreign companies to explore in Azerbaijan, Brazil, Ghana, Guinea, India and Indonesia, as well as Russia, Uganda and Qatar, according to the report’s data, which is drawn from the OECD, government documents, company reports and institutions.

Oil and gas exploration expenditure in G20 countries (public and private)
Oil and gas exploration expenditure in G20 countries (public and private). Photograph: ODI/Rystad Energy
The figures, published ahead of this week’s G20 summit in Brisbane, Australia, contains the first detailed breakdown of global fossil fuel exploration subsidies. It shows an extraordinary “merry-go-round” of countries supporting each others’ companies. The US spends $1.4bn a year for exploration in Columbia, Nigeria and Russia, while Russia is subsidising exploration in Venezuela and China, which in turn supports companies exploring Canada, Brazil and Mexico.


“The evidence points to a publicly financed bail-out for carbon-intensive companies, and support for uneconomic investments that could drive the planet far beyond the internationally agreed target of limiting global temperature increases to no more than 2C,” say the report’s authors.

“This is real money which could be put into schools or hospitals. It is simply not economic to invest like this. This is the insanity of the situation. They are diverting investment from economic low-carbon alternatives such as solar, wind and hydro-power and they are undermining the prospects for an ambitious UN climate deal in 2015,” said Kevin Watkins, director of the ODI.

The report is important because it shows how reforming fossil fuel subsidies is a critical issue for climate change.

“The IPCC [UN climate science panel] is quite clear about the need to leave the vast majority of already proven reserves in the ground, if we are to meet the 2C goal. The fact that despite this science, governments are spending billions of tax dollars each year to find more fossil fuels that we cannot ever afford to burn, reveals the extent of climate denial still ongoing within the G20,” said Oil Change International director Steve Kretzman.

The report further criticises the G20 countries for providing over $520m a year of indirect exploration subsidies via the World Bank group and other multilateral development banks (MDBs) to which they contribute funds.

The authors expressed surprise that about four times as much money was spent on fossil fuel exploration as on renewable energy development.

“In parallel with the rising costs of fossil-fuel exploration and production, the costs of renewable-energy technologies continue to fall rapidly, and the speed of growth in installed capacity of renewables has outperformed predictions since 2000,” said the report.

Source – The Guardian


fossil fuel burden

RTEmagicC_GrowingGreen.pngGermany offers the renewable future that terrifies the big energy corporations, says ALAN SIMPSON

News of the 25 per cent collapse in French nuclear multinational Areva’s share values triggered an unexpected sliver of sympathy in me.

The collapse followed their announcement of further delays in the construction of nuclear power plants in France and Finland.

It followed hot on the heels of news of the “secret” British review of whether Hinkley Point C will ever be viable or affordable.

Even former chief scientifc adviser to Tony Blair Sir David King, who knows a dead horse when he sees one, has been revising his own position, saying that Britain may not – after all – need any new nuclear power stations.

The whole debacle took me back to a schoolboy tale.

An investment consortium had bought the offspring of two champion racehorses. The offspring would be a sure-fire winner of the future.

They fed it, groomed it, trained it and, with great expectations, took it to the races. But the horse consistently failed to look anything but an abject loser.

In one race after another it came in last. Finally, the owners lost patience. “Listen” they told the jockey. “This is his last chance. If the horse doesn’t win today he’s out pulling a milk round tomorrow.”

But the race turned out like all the rest. The horse trailed the field. And the jockey, desperate to close the gap, began to use his whip urging the horse on. Forlornly, the horse turned its head and whispered: “Ease up, will you mate … I’m up early in the morning.”

I could hear the same unspoken words coming from Areva.

For Britain’s “investment consortium” (the coalition government) Hinkley Point C is rapidly becoming its own milk round mare – the most expensive way of keeping no-one’s lights on.

Politically, however, the problem goes well beyond nuclear. It reaches deep into the heart of Britain’s outdated energy thinking.

At the moment, Britain has an energy market that is not just a racket but a non-repairable one.

Privatisation turned energy into a short-term paper chase of profits and dividends.

Infrastructure renewal could be ignored because, in the end, the state (the taxpayer) could always be blackmailed into throwing limitless amounts of cash into the mouth of “keeping the lights on.”

It is a dilemma that continues to feed yesterday at the expense of tomorrow.

Epoch-changing moments come whether governments will them or not. And empires end on the same basis. It happened to the Romans when their armies had to chase into other people’s forests to keep their arms furnaces running. And it happened to wood once coal was found, and to coal as it was displaced by oil.

Today’s end of an era will see the replacement of non-renewables – fossil fuels and nuclear – with renewables. It is a change being driven more by technology than politics. But old empires do not die easily, especially when the empire owns the energy infrastructures that are most likely to be bypassed by tomorrow’s energy systems.

Energy politics has very little to do with keeping the lights on. Fundamentally, it is about money, profits and corporate power.

In 2008, Europe’s top 20 energy utilities had a market value of €1 trillion. The top 10 had a credit rating of A or above.

By 2013, the market value of these utilities had been cut in half – to €500 billion – and only five had a credit rating of A or above. Boardrooms around Europe are now having difficulty with bladder control.

The place that scares them most is Germany. This is why so much effort and money is being thrown into bribing or scaring governments into an “anything but Germany” approach to future energy thinking. It is easy to explain why.

Already, 50 per cent of Germany’s electricity generating capacity comes from renewables. People point to the fact that Big Energy only owns about 5 per cent of this generating capacity but they miss an even more important fact.

Under Germany’s “merit order” system, the grid takes clean energy before “dirty.” Moreover, once installed, both wind and solar come with near-zero marginal costs, and are key elements in the regular production of German electricity surpluses.

The practical effect of this is to have driven wholesale German electricity prices down from €80/MWh in 2008 to €38/MWh in 2013. Nothing illustrates this more graphicly than a look at the daily pattern of German electricity production.

In the graph shown of German electric power production (September 28 2014) the lighter shaded areas denote the contribution of renewables and the critical role they play in taking the peak out of peak demand.

Utilities have always known that peak demand meant peak pricing. And peak pricing is what drove their profits and dividends. Once the market opened up – once clean came before dirty, and once people could share what they themselves produced – old energy’s game was up.

This is the last thing Old Energy wants people in Britain to understand.

Just to complicate matters further, the World Bank seems to have woken up to the disaster of its old energy policies.

Having thrown £13bn in subsidies into fossil fuel projects over the last five years, the bank has called a halt. Henceforth, its support will now go into renewable energy.

For the rest of the financial world, the question is when will high-street banks follow suit and, more importantly, when will governments do so? In Fools Britannia the prospects do not look good.

With £37bn of financial promises and loan guarantees still pledged to Hinkley Point C, the coalition is still betting heavily on milk rounds.

And with unlimited endorsements of fracking and further oil exploration, Britain also looks set to remain a nation of exhaust-fumes inhalers for a long time to come.

Will Labour ride in to the rescue? Not as things stand. Almost as a replica of how the SPD found itself left behind by the German Energiewende transformation, Labour still finds itself surrounded by old energy interests that will not make it round the racecourse.

There is talk of signing up to the idea of 17 or more “super-cities” to radically drive a new vision of decentralised governance. But this still has more to do with spending rather than earning.

Parliament has forgotten that, until 1947, most local authorities earned 50 per cent of their income from the work of their localised utilities.

If Germany can already have 180 local authorities taking their energy grids back into public ownership, why should Britain aspire to just 17? Some part of British politics has to be able to reach out for something bolder.

Across Europe and the US, there is a clearer recognition that a more exciting back to the future moment stares us in the face. This is not a moment that would spin Britain back into pea-soup smogs, filthy washing lines and endemic bronchial illness.

Today’s and tomorrow’s radical reclamation of local energy systems will be based on clean, smart, lightness and less. And the first political party to grasp this will leave all others at the starting line.

You know it isn’t going to be Ukip. But who else it might be remains a mystery.

All we do know, so far, is that when canvassers come knocking on people’s doors, there will be little appeal behind the line “Come on. Go easy on us… we’re up early in the morning.”

Alan Simpson is an energy campaigner and former Labour MP for Nottingham South

Source – The Morning Star

Protesters demonstrate against fracking in Balcombe, West Sussex, last year.Hundreds of government-funded boreholes are set to be drilled across Britain to try to persuade the public that a looming shale gas boom can be developed safely, the Observer has learned. Sensors in the boreholes would detect possible water pollution or earthquakes caused by fracking and the information would be made public.

“We will be taking the pulse of the sub-surface environment and will reveal if things are going wrong, but also if they are going right,” said Professor Mike Stephenson, director of science and technology at the British Geological Survey, which would drill the boreholes. “The aim is to reassure people that we can manage the sub-surface safely.”

The plan, called the energy security and innovation observing system, will cost taxpayers £60m-£80m. It is awaiting final approval from the Department for Business, Innovation and Skills, where energy minister Matthew Hancock, a fracking enthusiast, holds another ministerial post.

However, the Green party MP Caroline Lucas accused the government of subsidising “dirty” energy firms. “There’s no justification for using public money to help the fracking industry pull the wool over people’s eyes. It’s another desperate attempt to quell legitimate public concern and may further undermine public trust,” said Lucas, who in April was found not guilty of public order offences after an anti-fracking protest in Sussex.

David Cameron has said the government is “going all out for shale”, but the issue remains highly controversial, with protests across the country. Ministers see shale gas and oil, which have transformed the American energy market, as providing an important economic opportunity for the UK. Chemical giant Ineos said last Thursday that it would invest £640m to launch a fracking revolution in Britain and claimed it could turn villagers into millionaires.

But opponents fear that fracking, which extracts underground gas and oil using high-pressure water and chemicals, will harm the environment and exacerbate climate change. Most experts say it will not lower UK energy prices.

“There would be many, many tens of boreholes in each shale gas area,” said Stephenson, with deeper ones monitoring for earthquakes and ground movement and shallower ones monitoring for water pollution. “Groundwater contamination is the big worry people have. Companies are required by law to monitor at their sites, but our interest is wider. For example, several kilometres away, are we sure groundwater is untouched?”

Stephenson said that a “step-change” was needed in underground monitoring: “We don’t know the health of the sub-surface because it is very little monitored at the moment.” The data gathered would also assist plans to dispose of nuclear waste underground and bury carbon dioxide captured from coal-fired power stations.

It would also be appropriate to use taxpayer funds to help develop the shale gas industry, he argued. “It is a good use of government money if we can monitor the environment but also make it more efficient to develop whatever we want to develop. I don’t think the fracking companies paying for the whole caboodle would play well with the public.”

Lucas countered: “The government is increasingly indistinguishable from the fracking industry it’s supposed to regulate. No amount of monitoring can make fracking safe. The only safe and responsible thing to do with shale gas is leave it in the ground.” She said ministers should pursue energy efficiency and community-owned renewable energy instead.

Tony Bosworth, energy campaigner for Friends of the Earth, said: “The government is behaving like a love-struck teenager, showering the shale gas industry with gifts. [It is] not content with changing trespass laws and handing out tax breaks – taxpayers may now have to fork out for the industry’s research. The public are unlikely to be convinced by our ‘all out for shale’ government assuring them fracking is safe, even with additional monitoring.”

Stephenson said: “America did not do it right, so let’s do it right here. If we found it was impossible to frack in the UK because, say, there are lots of faults in the rocks, that would come out.”

The government has streamlined regulation to speed up fracking exploration, but development has been hit by small earthquakes in Lancashire, planning refusals in Sussex and controversy over legal changes that allow fracking under homes without permission. Energy experts have also warned against hype. “It is very frustrating to keep hearing that shale gas is going to solve our energy problems. There’s no evidence for that whatsoever … it’s hype,” said Professor Jim Watson of the UK Energy Research Council.

Source – The Guardian

Wind-FarmEncouraging new research has been released by a coalition of industry leaders, which reveals the significant amount of untapped renewable energy available from local farms across the UK.

The research, carried out by the Farm Power coalition, found that there was at least 10 gigawatts (GW) of potential renewable energy capacity on UK farms, with 2.5GW being small-scale wind power. This is the equivalent of powering 1.3 million homes. The report concludes that this opportunity could be realised if a number of barriers, such as a supportive planning policy and access to grid connections, were removed.

The coalition was founded by the sustainability organisation Forum for the Future, and Nottingham Trent University, with steering group members including National Grid and the National Farmers Union.

The report comes a week after RenewableUK released its own Small and Medium Wind Strategy report, which highlighted the impending crisis in the small wind industry, which could easily be resolved with a change of heart by Government.

RenewableUK’s Small and Medium Wind Development Manager, Louisa Coursey, said: “This new report shows that Britain’s rural communities can play a crucial role in our transition from fossil fuels to clean energy sources such as onshore wind. It can help revive our rural economy with new jobs and investment, while providing a self-sufficient electricity supply to millions. At a time when small-scale wind is fighting for survival due to a lack of Government support, this evidence should make Ministers think  again before they  allow this great British success story to fall by the wayside”.

RenewableUK’s Small and Medium Wind Strategy report, published just last week, warns of serious issues on the horizon for the small wind industry as a result of reduced financial and political support from Government. The report points out that the current pressure being placed on the UK’s small wind industry is “driving it towards breaking point”.

The document outlines a number of simple measures to resolve this, including the need for the Government to publicly back the industry and simplify the planning procedure for smaller-scale applications.

The report also highlights growth in the medium wind sector, but warns that positive policies are needed in the future. These include improved finance lending and a fairer level of financial support. At present, financial support for small and medium wind is decreasing at a rate to which the industry is unable to keep up with. This means farmers and domestic users could be less able to take advantage of these low carbon technologies in the future.


1. RenewableUK is the trade and professional body for the UK wind and marine renewables industries. Formed in 1978, and with more than 560 corporate members, RenewableUK is the leading renewable energy trade association in the UK.

2. The full report can be read here: http://www.forumforthefuture.org/sites/default/files/Farm%20Power_Size%20of%20the%20Prize%20report_Nov-2014.pdf

3. RenewableUK’s recent Small and Medium Wind Strategy Report is available at: http://www.renewableuk.com/en/publications/index.cfm/Small-and-Medium-Wind-Strategy-report-2014

picklesIn 2013 Daventry District Council refused an application to install the single wind turbine at Long Furlong in Catesby, Daventry.

An inspector recommended in July that an appeal lodged against the council’s decision should be allowed, saying that the weight attached to the renewable energy provision “clearly outweighs the other harm”.

But a decision letter issued today said Pickles disagreed with the inspector’s recommendation, and refused planning permission for the development.

The proposed wind turbine was planned in the vicinity of Long Furlong Farmhouse, a Grade II listed building.

The decision letter said that Pickles disagreed with the inspector’s opinion that the wind turbine’s impact on views of the listed building from some aspects would only have a limited impact on the overall significance of the listed building.

It said: “The Secretary of State … concludes that the introduction of a large, modern, aerodynamic structure, of a different scale and appearance to most other features that are found in the countryside, into the vicinity of an 18th century listed farmhouse, would substantially alter the significance of that farmhouse.”

The decision letter also said that Pickles disagreed with the view that the turbine would not significantly change the character of the farmland and would not be out of place.

The letter said: “[The secretary of state] concludes that while this is a working environment/setting with changes to the setting relating to changing needs in modern farming, it is also farmland centring on a listed building dating from the 18th century, and thus that the introduction of a piece of large, prominent modern equipment will inevitably change its setting.”

E4allThe Financial Conduct Authority (FCA) is currently consulting on new guidance relating to the registration of new co-operatives including renewable energy co-operatives.  This consultation follows a change of approach by the FCA dating from the Spring of this year when they started to reject applications to register new renewable energy co-ops.  Since the Spring a significant number of new Co-operative Societies (previously often known as members co-ops) have been refused registration. To date the problem has not affected Community Benefit Societies (previously known as bencoms).

The reason for this is that the FCA has unilaterally decided that renewable energy co-ops in England, Wales and Scotland are not legitimate co-operatives as they do not directly trade with  their members.   In fact there is no requirement in the 7 principles of the International Co-operative Alliance on co-operatives to trade with their members and in the UK the very tight and highly complex regulatory requirements of the energy supply industry effectively prevents co-ops selling electricity directly to its members.

We think renewable energy co-ops are a force for good and a force for change and should be encouraged, not obstructed in this way.  Wider use of the cooperative model can make an important contribution to changes in energy production and consumption which will help democratise the ownership of energy, reduce energy prices, support communities and increase the production of renewable energy which is such a vital tool in the fight against climate change.

The consultation on these matters closes on 28 November 2014.  You can read the document here http://www.fca.org.uk/news/cp1422-guidance-on-the-fcas-registration-function-under-the-cooperative-and-community-benefit-societies-act-2014.

We encourage you all to participate in this consultation and make sure your views are heard.

Send a simple message to the FCA: renewable energy co-ops are a good thing and there should be more of them.  The FCA should register any co-operative that complies with  the international principles of co-operation and not impose additional constraints, such as requiring Co-operative Societies to trade directly with their members.

Mike Smyth
Chair – Energy4All

The 7 co-operative principles by which co-operatives put their values into practice as set out on the official website of the International Co-operative Alliance
1. Voluntary and Open Membership
Co-operatives are voluntary organisations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.
2. Democratic Member Control
Co-operatives are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary co-operatives members have equal voting rights (one member, one vote) and co-operatives at other levels are also organised in a democratic manner.
3. Member Economic Participation
Members contribute equitably to, and democratically control, the capital of their co-operative. At least part of that capital is usually the common property of the co-operative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their co-operative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the co-operative; and supporting other activities approved by the membership.
4. Autonomy and Independence
Co-operatives are autonomous, self-help organisations controlled by their members. If they enter into agreements with other organisations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy.
5. Education, Training and Information
Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their co-operatives. They inform the general public – particularly young people and opinion leaders – about the nature and benefits of co-operation.
6. Co-operation among Co-operatives
Co-operatives serve their members most effectively and strengthen the co-operative movement by working together through local, national, regional and international structures.
7. Concern for Community
Co-operatives work for the sustainable development of their communities through policies approved by their members.