Tag Archives: carbon
California And Australia Bolster Carbon Trading Ties
Memorandum of understanding comes weeks after Australian Prime Minister Kevin Rudd pledged to accelerate introduction of emissions trading scheme By Jessica Shankleman 31 Jul 2013 California and Australia have agreed to step up efforts to work together to link their respective carbon markets, just weeks after Australia’s prime minister announced he would accelerate plans to replace the country’s carbon tax with an emissions trading scheme. California’s Air Resources Board and Australia’s Clean Energy Regulator yesterday signed a memorandum of understanding that aims to establish a working relationship for the two organisations to co-operate on efforts to curb greenhouse gas emissions . The agreement builds on existing work over the last year, which has seen the two organisations share some of the practical experiences gained introducing a new carbon market. The new framework focuses on measures to increase investment in clean energy generation and improve market integrity, as well deepening collaboration between the two agencies. For example, it will allow the organisations to share information on designing and running carbon pricing programmes and discuss how they could link their markets in future . Mary Nichols, chairwoman of CARB, said the agreement would continue California and Australia’s “productive relationship” as both jurisdictions seek to expand their carbon markets. “It is another step forward in California’s efforts to establish relationships with other programs to continue sharing information and best practices to fight the global danger of climate change,” she said. The agreement comes just weeks after Prime Minister Kevin Rudd said Australia would replace its carbon tax with an emissions trading scheme (ETS) a year earlier than planned if his Labor party were to win this year’s election. Rudd wants the fixed price on carbon to end on 30 June 2014, rather than 2015, with a floating market linked to the European Union’s ETS opening the following day. Continue reading
Carbon Emission Costs Eat Into Profits At Power Supplier Drax
COAL-fired power producer Drax posted a fall in half-year profit yesterday, as the company began paying a Government-imposed minimum price for carbon. It said earnings for the first half of the year fell 22 per cent, as it converted one of its generation units to biomass and the costs of emitting carbon more than doubled. For the first time, Drax, which is based near Selby, has been fully exposed to prices for European Union carbon permits, which most EU utilities must pay for in full in the current 2013-2020 phase of the emissions trading scheme. Drax, the operator of one of Europe’s largest coal-fired power stations, must also pay an extra carbon cost imposed by the Government in April. It said earnings before interest, tax, depreciation, and amortisation (EBITDA) fell to £120m ($184m) for the six months ended June 30, down from £154m a year ago. “We are investing significant capital this year and next to transform our business, with earnings during this period impacted by the increasing costs of carbon,” chief executive Dorothy Thompson said. Drax said it had to pay £70m for EU carbon allowances through the emissions trading scheme, which ended free allocation to utilities in its current phase, almost double the £38m it had to pay last year for the permits. Meanwhile, a carbon floor price introduced by the Government on April 1 cost Drax £14m up to the end of June, the company said. The current tax, at £4.94 per tonne, is in addition to each power firm’s obligation under the EU carbon market, and is set to rise to £9.55 next year and £18.08 in 2015. The power generator spent £138m in the first half of the year on fixed assets, up from £90m a year ago, mainly for facilities to ship and store wood pellets. Drax plans to convert a second 660MW unit to biomass next year, with a third possible in 2017, depending on Government incentives and the availability of wood that can be certified as sustainable. However, the extra costs of carbon and infrastructure were offset partly by lower costs for coal, driving down fuel costs. Shares in Drax rose yesterday as investors responded calmly to the fall in profits, which was in line with the company’s expectations. Drax said it hoped to increase the amount of electricity generated by its converted biomass unit, which only operated at 57 per cent of capacity due to disruption in wood pellets supply. It said the investment in permanent transport and storage facilities would ensure a steady flow of supply of biomass which is sourced mainly from North America and eastern Europe. Wood pellets have to be moved in much bigger quantities than coal, which has prompted Drax to build large inflatable domes at its power station to store biomass. greg.wright@ypn.co.uk Continue reading
GIB Invests £20 Million In Biomass
30 July 2013 by Emma Leedham See an enlarged version of this infographic The construction of a wood-fuelled combined heat and power (CHP) station in Londonderry, Northern Ireland, was given the go ahead yesterday (29 July), after the Foresight Group and the UK Green Investment Bank plc (GIB) invested £20 million into the £81 million project. The investment has enabled the Evermore Renewable Energy CHP to be built on a ten-acre site at the Londonderry Port and Harbour Commissioners land at Lisahally. The project is forecast to be the largest renewable energy project in Northern Ireland, and is expected to operate from 2015 to 2035. According to the GIB, the 15.8 megawatt project – its first investment in Northern Ireland – will increase renewable electricity generation in the country by around 10 per cent, and deliver a reduction in greenhouse gas emissions of around 3.7 million tonnes. Partner funders include GCP Infrastructure Fund Ltd, Burmeister & Wain Scandinavian Contractor A/S (BWSC), Investec Bank, and Eksport Kredit Fonden. Project details The CHP project, led by Evermore Renewable Energy (a subsidiary of the Evermore Group, founded in 2009) aims to supply enough renewable electricity to power more than 25,000 homes each year, create 200 construction jobs and over 20 full time jobs once in operation. Speaking of the project, Ciaran and Stephen Devine, co-founders of the Evermore Group commented: “We are making a serious commitment to the Northern Ireland energy market. Working with the best partners in technology, fuel supply and financing, we hope to show that Northern Ireland is a great place to do business so that further inward investment will follow. “This is the culmination of many years of hard work to develop and finance the largest green energy power station in Northern Ireland. Our ability to attract this level of investment into Northern Ireland is testament to our team’s commitment and skill in both project development and project financing. This now marks the start of the construction phase and with that the creation of over 200 much needed construction jobs in the North West.” They added that work should begin on the project in the ‘next six to eight weeks’. ‘Landmark moment’ for GIB Speaking of the investment, Shaun Kingsbury, Chief Executive of the UK Green Investment Bank, said: “[This] announcement will substantially increase Northern Ireland’s renewable energy capacity. Not only will the project save the same amount of carbon as taking around 77,000 cars off the road, it will also make use of over two million tonnes of wood, a valuable energy resource that would otherwise have gone to landfill.” The recycled wood (largely recovered from the construction and demolition industry) will be supplied under a fuel contract with Stobart Biomass Products Limited. Provision is being made to use up to 30 per cent of local wood biomass. Business Secretary Vince Cable said: “The first deal done in Northern Ireland is a landmark moment for the UK Green Investment Bank and I’m confident that there will be more to come.” Northern Ireland’s Energy Minister Arlene Foster added: “The Evermore plant will make an important contribution towards Northern Ireland’s 2020 renewable energy targets. “It is a wonderful example of local, national and international co-operation and I am particularly pleased to note that this is the first Northern Ireland project to secure funding from the Green Investment Bank.” The investment comes from the UK Waste Resources & Energy Fund (UKWREI), managed by investment management company Foresight, in which the GIB is the cornerstone investor. L aunched in November 2012 , the Green Investment Bank was given £3.8 billion of funding from the UK Government to support environmentally-friendly projects that cannot obtain sufficient funding from the markets. The GIB provides investment for renewable and low-carbon technologies such as offshore wind, energy from waste, non-domestic energy efficiency as well as biofuels for transport, biomass power, carbon capture and storage, marine energy and renewable heat projects. ‘Temporary solution’ Despite the GIB investment, Secretary of State for Energy Security Edward Davey has previously told the BBC that biomass was a temporary solution to meet climate targets while renewable energy systems were being developed. Indeed, government recently announced that grants for existing biomass plants are being capped at 400 megawatts (MW), and that there will be no renewable heat incentive (RHI) tariffs for new biomass plants. “Making electricity from biomass based on imported wood is not a long-term answer to our energy needs – I am quite clear about that”, he said. Biomass ‘dirtier than coal’ Biomass has been a controversial choice of renewable energy, with a joint report by the Royal Society for the Protection of Birds (RSPB), Friends of the Earth and Greenpeace, titled ‘ Dirtier than Coal ‘ , suggesting that biomass derived from virgin wood may be more polluting than coal. Indeed, the government’s own statistics suggest that burning whole trees can result in 49 per cent more emissions than burning coal. Harry Huyton, RSPB Head of Climate Policy, explained: “When trees are burnt in power stations, CO2 [carbon dioxide] comes out of the chimney, just like it does when you burn coal. The difference is that the wood is less energy dense and is wetter than coal, so it takes a lot more energy to harvest, transport, process, and finally burn it. “Government has justified burning trees in power stations by claiming the chimney emissions are offset by the carbon that the forest takes in when it regrows after being harvested, but this is misleading. It can take decades, if not centuries, for the trees to recapture that carbon, leaving us with more emissions in the atmosphere now – when we least need it.” Continue reading
