Adding Fuel to the Fire: Will Plunging Oil Prices Hurt the Environment?

2131Oil prices are in free fall. On Monday, the price of a barrel of West Texas Intermediate (WTI) crude fell below $50 for the first time since 2009. This compares to a price of $105 per barrel just 6 months prior. Certainly, a drop of this magnitude could have considerable economic and geopolitical implications. But how will it impact the environment?

On one hand, analysts argue that the slide in oil prices could generate environmental benefits and opportunities. Foremost, the lower price of oil reduces the incentive of energy companies to drill for more. According to one shale pioneer, companies will “pull back and won’t drill until the price recovers”. This is particularly true for high cost oil fields with break-even points above $50 per barrel. Many such fields contain heavier oils, which require significantly more energy to extract/refine and create greenhouse gas footprints “nearly twice as large as lighter oils”. Thus, in the words of the National Resources Defense Council, “Low prices keep the dirty stuff in the ground”.

Secondly, the drop in oil prices and production will hurt the energy sector’s bottom line. While big oil can likely weather the storm, many junior oil companies will struggle to secure enough profit and financing to remain in business. In fact, some believe that OPEC is intentionally suppressing oil prices to “clean up the marginal market”. Already, the number of junior oil companies in Canada’s oil sands has fallen from 94 in 2007 to 43 (as of Q3 2014). This decline in oil companies could further reduce oil extraction.

Additionally, low oil prices will make it more “politically feasible to implement the carbon pricing reforms…necessary for significantly reducing emissions”. Consumers will “more readily accept” a carbon tax, for example, than when oil prices are already high. Hence, according to Virgin Airlines owner Richard Branson, “If governments want a carbon tax…[2015] would be the best time”. Former Treasury Secretary Lawrence Summers adds that “It would be a hugely important symbolic step ahead of the global climate summit in Paris late this year”.

But lower oil prices could also produce significant adverse environmental effects. The clearest effect is on oil consumption, which produces the greenhouse gases linked to climate change. Basic economics dictates that as the price of oil declines, there will be “more oil use now”. The same is true for oil products (e.g. gasoline) or complements (e.g. cars and flights).

Consider gasoline, for example. Cheaper oil translates into cheaper gasoline, as “crude oil accounts for about half of the price of gasoline at the pump”. In the short-term, this may lead to longer or more frequent vehicle use. Over the long-term, it may encourage consumers to purchase less fuel efficient vehicles or homes further from the city. Consequently, economists estimate that a 25% drop in gasoline prices could increase gasoline consumption by 2 – 5% immediately and 10 to 20% over the long-term.

With increased consumption of oil and oil products, the demand for alternative energy will also fall. This includes wind, geothermal, and solar energy (which was cheaper than oil before the drop). Likewise, “a sustained period of low oil prices will dampen investment in alternative technologies”, which appear “less urgent”. Governments could attempt to counter such effects through subsidies to producers or consumers. However, subsidies would need to increase as the price gap between oil and alternative power grows. For these reasons, some maintain that collapsing oil prices will “derail the green energy revolution”.

In sum, the net environmental impact of plummeting oil prices is “not immediately clear”. What is clear is that “Whether oil’s price tag is high or low, neither ensures climate protection”. So what, then, is the best long-term price of oil, from an environmental perspective According to experts at Harvard University, the ideal price range could be between $60 and $80. At $75 a barrel, for example, the price is “high enough to keep investments flowing into alternatives, while giving energy companies less reason to pursue expensive and risky oil fields that also pose the greatest threat to the environment”.

To support or learn more about alternative energy, please contact Clean Energy Now, GRID Alternatives, or our partners, Solar Sonoma County[xxxi] and Clean Air Cool Planet.

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The Clean Power Plan: Obama’s “Last Sweeping Effort to Remake America”

wind5Earlier this week, President Obama unveiled his latest plan to reduce greenhouse gas emissions and slow climate change. Dubbed the “Clean Power Plan”, it calls for the power industry to cut carbon dioxide emissions 30% by 2030 (from 2005 levels).

To achieve this reduction, the plan establishes individual targets for states. The targets reflect each state’s economy, current emission levels, and capacity for cuts. For example, coal-dependent Kentucky has a target of 19%, while hydro-rich Washington has a target of 84%. The plan, like the Affordable Care Act, also gives states great flexibility in meeting their targets. Among other actions, states can shut down coal plants, invest in wind and solar power, install energy efficient technology, join a cap-and-trade program, or enact a state tax on carbon pollution.

From a purely environmental perspective, many are hailing the plan. After all, the United States’ roughly 1000 power plants account for nearly 40% of all US carbon emissions – and currently face no carbon pollution limits. They also emit harmful particle pollution, nitrogen oxides, and sulfur dioxide, which are expected to decline by over 25% as a “co-benefit” of the plan.

Some also believe that the Clean Power Plan will shape climate change policy abroad. Christiana Figueres, Executive Secretary of the UN Framework Convention on Climate Change, claims that she “fully expects [the US plan] to spur others in taking concrete action”. (This includes countries like Canada, which have largely tied their emissions targets to the US). Moreover, by sending “a strong signal that the US is serious about reducing carbon pollution”, the plan will “give Washington legitimacy in international talks next year to develop a framework for fighting climate change”.

But despite all the praise for Obama’s “most ambitious plan yet“, not all environmentalists are giving the plan a green thumbs up. First, some feel that the plan does not go far enough. They note that carbon emissions already fell 15% between 2005 and 2013, in part due to the “retirement of coal plants in favor of cleaner-burning natural gas”. This suggests that the 30% target by 2030 is “arguably easier to reach”. In the words of Andrew Revkin of the New York Times, the “Obama plan in effect takes twice as long (16 years) to cut as much carbon pollution as the country just did in 8 years”.

Furthermore, the Obama plan is limited to only one sector of the economy: power generation. According to the Food & Water Watch and the Institute for Policy Studies, this narrow scope will leave the US “far short of the IPCC’s goals for developed countries of economy-wide reductions of 15 to 40% below 1990 emission by 2020”. In fact, with these targets alone, US emissions will still exceed 1990 levels by 2030.

Finally, the Obama plan aims to phase fossil fuels (particularly coal) out of the US energy mix.  However, until economically competitive substitutes hit the market on a large scale, this may be a “waste of effort”. As highlighted by Steve Cohen, Executive Director of Columbia University’s Earth Institute, “The vast increases in fossil fuel based energy use in China and India alone virtually guarantee continued global warming. Only a lower-priced, reliable, and convenient replacement for fossil fuels will make a difference”.

So what can we make of this debate? Will the Clean Power Plan turn the “red, white, and blue” green? Certainly, by targeting the single largest source of carbon dioxide in the United States, the plan is a “creditable” start. And, without question, it is better than the status quo (no carbon regulations for power plants). However, the plan alone is not the panacea for global climate change. To make real headway, it must be complemented by investment in research, development, and dissemination of renewal substitutes.

To learn more about the Clean Power Plan, please contact the Center for Climate and Energy Solutions, the US Climate Action Network, or our partners: Clean Air Cool Planet and the American Lung Association in California.

Flickr photo credit: Thunderbolt_TW

 

Are You a Green Investor? Fossil Fuel Divestment Campaigns Heat Up

tree3This week, Harvard became the first American university to adopt UN-backed guidelines for responsible investment. The guidelines require the Harvard Management Company to consider environmental factors when managing the university’s $33 billion endowment, the largest in the country. In addition, Harvard agreed to join the Carbon Disclosure Project and to cut greenhouse gas emissions 30% from 2006 levels by 2016.

But the university stopped short of committing to a further green action: selling its holdings in fossil fuel companies. According to recent SEC filings, Harvard has $34.6 million invested in the top 200 fossil fuel companies, such as Exxon Mobil and ConocoPhillips. It also has millions invested indirectly in the industry.

Since 2012, a Harvard student group has repeatedly called on the university to divest its fossil fuel holdings and to reinvest in socially responsible funds. In the words of the group, the top 200 fossil fuel companies are “directly linked to accelerating global warming”. If they burn more than 20% of their reserves, “our planet will likely be locked into irreversible warming at a rate above two degrees Celsius”. Furthermore, many of the companies have “spent millions of dollars on…disinformation tactics that seek to confuse the public on global warming science” and “actively undermine the conclusions of our research and education”. By investing in the industry, the university is complicit in these actions.

Harvard President Drew Faust, however, opposes divestment on several grounds. Foremost, she argues that the endowment exists solely to advance Harvard’s academic mission, “not to serve other purposes, however worthy”. Limiting investment options could “significantly constrain investment returns”, which funds over 1/3 of university operations. Secondly, Faust maintains that universities own a “very small fraction of the market capitalization of fossil fuel companies”. Thus, divestment would have a “negligible financial impact” and would diminish Harvard’s influence over the industry. Third, Faust notes that fossil fuels remain essential, fueling everything from our lights to our computers. She suggests that boycotting the industry would therefore prove hypocritical. Finally, Faust asserts that there are more effective ways for Harvard to address climate change. In particular, she cites the university’s teaching and research.

But Faust’s arguments don’t hold water. First, if universities have “very small” holdings in fossil fuel companies, divestment should not significantly constrain investment returns, nor jeopardize universities’ influence over the industry. At the same time, divesting the holdings could greatly impact fossil fuel companies by spurring other investors to dump their shares. Certainly, achieving such outcomes is not the primary goal of Harvard’s endowment. However, the endowment has divested from other companies in the past for political purposes, including tobacco companies and those linked to apartheid. Lastly, our current dependence of fossil fuels does not justify our continued investment in the industry. If anything, it creates an added incentive to invest in renewable solutions. This can compliment other initiatives, including climate change teaching and research.

Groups in 300+ American universities agree and continue to push for fossil fuel divestment. To date, groups at 10 universities have succeeded, including Green Mountain College, Unity College, and Hampshire College. According to Paul Foteyn, President of Green Mountain College, “We see this as another step in an ongoing effort to connect our investment decisions with our ideals”. Stephen Mulkey, President of Unity College, adds “In the near future, the political tide will turn and the public will demand action on climate change. Our students are already demanding action, and we must not ignore them.”

In sum, Harvard’s decision to adopt guidelines for responsible investment is a step in the right direction. However, given the catastrophic threat of climate change, the decision fails to go far enough. It’s time for Harvard and other universities to heed the resounding calls of students. It’s time to fully divest from fossil fuels.

To learn more about fossil fuel divestment, please contact Fossil Free, 350.org, the Climate Reality Project, or the Sierra Club. To share your thoughts on the debate, please post a comment below.

Flickr photo credit: Alex West

Melting Away? The Future of the Winter Olympic Games

winter olympicsThis weekend, the 2014 Winter Olympics will launch in Sochi, Russia. The event will involve 2800 athletes competing in 15 disciplines. It will also air in over 200 countries to an audience of 3.8 billion people, making it one of the largest cultural celebrations on earth.

But Winter Olympics in places like Sochi may soon be a thing of the past. In fact, according to a report from the University of Waterloo, only 11 of the 19 winter Olympic cities could reliably host the games by 2050. This number drops to only 6 cities (or less than 1/3) by the end of the century.

The culprit is climate change. The IPCC projects that the average February temperatures of the winter Olympic cities will rise by 1.9 – 2.1° Celsius by 2050 and 2.7 – 4.4° Celsius by 2100. As a result, many of the cities will lack the necessary conditions for Olympic events in over 25% of winters. These conditions, as defined by the University of Waterloo, are a snowpack of 30+ cm at high elevations and daily minimum temperatures below 0° Celsius (allowing snow and ice surfaces to recover from daytime melt).

The reality has forced “Olympic organizing committees, sporting federations, and the IOC to continually develop and refine strategies to reduce the risks of adverse weather”. Current strategies include scaling up snowmaking machines, refrigerating bobsled and luge tracks, moving events indoors, and stockpiling snow. But future strategies may include more extreme measures, such as cloud seeding (or spraying silver iodide into the atmosphere to encourage precipitation). Popular skiing destinations in Idaho and Nevada are already using the practice to increase snowpack.

However, in the words of Daniel Scott, an associate professor at Waterloo’s Faculty of Environment, “There are limits to what current weather risk management strategies can cope with. By the middle of this century, these limits will be surpassed in some former Winter Olympic host regions.”

Thus, a more dependable solution is to actually reduce greenhouse gas emissions and curb climate change. For its part, the International Olympic Committee has “amended the Olympic Charter to include a binding commitment to sustainable development”. It has also worked with host cities to mitigate and offset emissions (e.g. through energy efficient infrastructure, reforestation etc). Now, the 200+ Olympic member nations must show similar dedication, both through national and international actions. Otherwise, we may need to start preparing for North Pole 2090.

To learn more about climate change and its impacts, please contact the Climate Reality Project, 350.org, or the Citizens Climate Lobby.
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Waiting to Inhale: Air Pollution a Problem at Home and Abroad

smoke2In mid-January, air pollution in Beijing, China reached an alarming level. According to the municipal government, Beijing’s air contained 500 micrograms of fine particulate matter per cubic meter.This is 20 times the level recommended by the World Health Organization and almost twice the level deemed “hazardous” by the US Environmental Protection Agency (EPA).

In fact, the pollution was so debilitating that Beijing authorities closed 4 major highways in the Chinese capital. They pledged to cut coal use by 2.6 million tonnes and to prohibit all heavily polluting vehicles by December 31. And, perhaps most controversially, they threatened to ban fireworks displays in honor of Chinese New Year.

But while Beijing’s air pollution has received disproportionate media cover (including a viral story about televised sunrises), it isn’t the only city facing this environmental problem. Indeed, several cities in Iran, Pakistan, and India report comparable–or worse–air pollution levels. North American cities are not immune either. Los Angeles and the San Joaquin Valley are notorious for smog, caused by vehicle emissions, manufacturing, and farming. Furthermore, despite significant improvements over the last 50 years, Pittsburgh continues to register high pollution levels due to coal combustion and heavy industry.

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The effects of this pollution are hard to swallow. Studies indicate that high concentrations of air pollution can trigger irritation of the eyes, nose, and throat; as well as coughing and wheezing. It can exacerbate heart and lung problems, including asthma. And, after long-term exposure, it can increase the risk of cancer and mortality. Consequently, experts maintain that Alleghany County (home of Pittsburgh) is in the top 2% for cancer risk in the United States. They also estimate that the life expectancy in Beijing is 5 – 6 years lower than in China’s southern cities.

The environmental effects of air pollution are troubling as well. Sulfur and nitrogen oxides contribute to acid rain and eutrophication, impacting biodiversity. Chlorofluorocarbons and halons accelerate the depletion of the protective ozone layer. Toxic pollutants lead to reproductive problems and disease in animals and aquatic life. And greenhouse gases trap solar radiation, causing climate change.

These human and environmental effects compel us to act. As individuals, we can reduce our emissions by conserving energy, recycling, and limiting vehicle use. But a large-scale reduction in air pollution will require “much wider policies by national and international authorities”. The recent announcements in China are encouraging, as are the EPA’s efforts to implement a Cross-State Air Pollution Rule and a New Source Performance Standard (to limit CO2 emissions). Society must continue to demand such actions, and ensure their realization. Then we can all breathe a little easier.

For more information on air pollution, please contact the Clean Air Task Force, the Coalition for Clean Air, Breathe LA, or our partners, Clean Air Cool Planet and the American Lung Association in California.

Flickr Photo Credit: Kim Seng

 

Ontario to Become First Jurisdiction in North American to Ban Coal

coal power plantLast month, in a star studded ceremony, the government of Ontario announced legislation to ban the burning of coal in the province. Known as the Ending Coal for Cleaner Air Act, the legislation is expected to pass with the support of all major opposition parties. This would make Ontario the first regional jurisdiction in North America to prohibit burning of the fossil fuel.

The expected impacts are considerable. As the name of the act implies, the ban will reduce emissions of key pollutants including nitrogen oxides, sulphur oxides, particulate matter, and greenhouse gases. All else equal, this will lower the incidence of related health issues, such as asthma and chronic lung disease. It will also improve environmental outcomes by stemming smog, acid rain, and climate change. Together, these benefits are expected to save Ontario an estimated $4.4 billion per year.

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Of further note is the symbolic impact of Ontario’s groundbreaking legislation. In the words of former Vice President Al Gore, who participated in the announcement, “Thank God for the people of Ontario providing such leadership… if [the world was able to do] what Ontario is announcing today, then half of the CO2 would fall out in a single generation…We need to get busy and follow Ontario’s lead”.

But amidst all the praise for Ontario’s announcement, there is also some criticism. First, in the 2003 election, the Liberals agreed to phase out all coal by 2007. This deadline was “pushed back” repeatedly until 2013. Secondly, the province is only able to “kick its coal habit” due to new and refurbished nuclear and natural gas plants. While preferable to coal, these energy sources are not as green as solar and wind.

Still, [it’s the opinion of this writer] that Ontario’s legislation to ban coal is a step in the right direction. Other North American jurisdictions should look to Ontario’s example—particularly the Midwestern and Appalachian states where coal accounts for 50 to 96% of the energy mix.

To learn more about coal power, please contact the Union of Concerned Scientists, the Climate Reality Project, Environmental Defence, and our partner, Clean Air Cool Planet.

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Four Years After the Quake, Recovery Lags in Haiti

Haiti CrisisIn recent months, the world has endured several devastating natural disasters: the earthquake in Pakistan, flooding in Cambodia, and the massive Typhoon Haiyan in the Philippines. These disasters remind us of another tragedy closer to home – the 2010 Haitian earthquake.

Approaching its 4th anniversary, the 7.0Mw Haitian earthquake claimed the lives of approximately 250,000 people and injured hundreds of thousands more.  It also destroyed (or severely damaged) 250,000 residences and 30,000 commercial buildings, leaving over a million people homeless. The resulting humanitarian disaster remains one of the worst of the 21st century.

So what is the status of Haiti today? The country and its foreign partners have made progress on several fronts. As of 2013, they have removed most of the 10 million cubic meters of debris and housed 158,000 affected families. They have provided grants, training, and over 470,000 temporary jobs. They have vaccinated 3,000,000 children and constructed new hospitals. Moreover, they have enhanced preparedness for future disasters. But these achievements are overshadowed by the crippling challenges Haiti continues to face.

JP HRO Haiti Relief
According to The Economist, more than 350,000 Haitians still live in tents or substandard housing in “hillside shanties and seaside slums”. Unemployment hovers at around 75%. A cholera epidemic, which has taken over 8000 lives, continues to spread. Furthermore, the underlying, long-term problems inflicting Haiti remain unaddressed. Yet, aid for the tiny Caribbean country is running out. Many non-profits have disbursed their funds and are struggling to attract new donations given “donor fatigue”. Others have succumbed to corruption, squandering funds on exorbitant salaries, travel, and consultant fees. Finally, as highlighted by the UN Special Envoy for Haiti, many aid pledges have simply gone “unfulfilled”.

Op4G’s partners, however, remain committed to serving the people of Haiti. Greater Good: Haiti focuses on delivering primary school education programs and sustainability projects in under-served communities, while A Chance for Kids works for the “relief and betterment” of Haitian children. Please help create lasting change in Haiti – support these non-profits today!

 

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Survival of the Fattest: The Effect of Shrinking Sea Ice on Polar Bears

polarOver the last month in the Canadian Arctic, around 1000 polar bears have gradually migrated to the coastal areas around Hudson Bay. After spending the summer on land, the bears are preparing for their return to sea ice.

The sea ice is critical to the bears’ survival. It “provides a vital platform to hunt ringed and bearded seal”, as well as other prey. This rich diet helps replenish the fat reserves of the world’s largest bears (weighing up to 1300 pounds). It ensures that after the ice melts, the bears can survive another lean summer on land.

But, like many animals, polar bears are falling victim to climate change. Since 1979, “sea ice cover has declined by about 30% in the Arctic”. Furthermore, the length of the sea ice season has fallen by approximately 30 days.

Consequently, “polar bears have been coming to land earlier and leaving later in recent years”. As the bears lose nearly 2 pounds/day on land, they are “60 pounds lighter on average than [polar bears] three decades ago”.  This weight loss has profound effects on the species. Lighter bears are not only less robust, they also produce smaller cubs “which can struggle to survive”. Hence, the polar bear population in Churchill, Manitoba (the “polar bear capital of the world”) has dropped by 22% since 1987. Without intervention, “two-thirds of all polar bears will be gone by 2050—and perhaps extinct in the wild by the end of the century.”

Unfortunately, polar bear conservation is no simple task. According to Polar Bears International, the traditional solution is to protect critical habitat, “but we can’t really build a fence to protect the sea ice from rising temperatures.” Nor can we simply wait for polar bears to re-adapt to life on land: “They can’t undo hundreds of thousands of years of evolution in 50 or 100 years.” Therefore, a better approach is to stem the rise of greenhouse gas emissions and, by extension, climate change.

This requires a concerted effort by many actors: governments, businesses, and individual citizens. To learn how you can combat climate change, please contact Clean Air Cool Planet. Also, to support threatened wildlife, please donate to the WWF or our partners, Motley Zoo Animal Rescue and Noah’s Ark.

Flickr photo credit: Staffan Widstrand

The Light through the Fog: Grassroots Actions to Combat Climate Change

Climate Change OpportunitiesIn recent years, the news has highlighted key setbacks in the battle against climate change: rising greenhouse gas emissionsArctic warming, and failing international efforts. This blog has following suit, featuring posts on elevated carbon dioxide levels and the link to natural disasters. But climate change news is not all doom and gloom.

As captured by the website “It’s Happening”, created by the non-profit 10:10, grassroots climate change action is occurring around the world. In some cases, this action is large scale. In Bangladesh, for example, Grameen Shakti has installed home solar energy systems at a rate of 1 per 90 seconds, reaching its 1 millionth home in 2012. Furthermore, Portugal’s grid operator has invested heavily in wind and hydropower, increasing the countries’ renewable energy use to 70%.

Climate Change Action

Other efforts are more modest. The UK’s Kennett and Avon Canal has paused its pumps when energy demand is high, keeping the “dirtiest power plants switched off longer”. European partners have built the MS Tûranor PlanetSolar, the first entirely solar-powered ship to circumnavigate the globe. And in Chicago, the city has installed 1,000 LED traffic lights, requiring 85% less energy.

The actions featured on “It’s Happening” are both exciting and inspirational. They highlight that climate change action is feasible, if the will exists. But the actions are just a start. Collectively, they are “nowhere near the carbon cuts we need”. Moreover, they are no substitute for national and international climate change action.

To learn more about climate change action, and how you can contribute, please visit: 350.org, the US Climate Action Network, Earthjustice, and our partner, Clean Air Cool Planet.

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