Green Power

Green power

Governments push environmental change despite economic slump: report

By Jennifer Byrd

Posted: February 25, 2009, 8:44 AM ET

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Governments worldwide have escalated "green" regulation and innovation initiatives over the past eight months, despite the global economic slump, according to a report from Deutsche Asset Management's DB Climate Change Advisors unit.

In fact, industries focused on clean technology, renewable energy and climate-change alleviation are likely to emerge from the global recession in good shape precisely because economic stimulus packages passed by governments around the world have earmarked significant resources toward those very efforts.

The report identified250 new regulations — worth more than $200 billion all told — that support renewable energy and climate-change mitigation that have popped up in government stimulus packages worldwide.

"(Governments) have certainly stepped up the pace in the past six to nine months, particularly because of the stimulus packages," Mark Fulton, global head of climate-change investment research at DB Climate Change Advisors, said during a Feb. 24 conference call on the report.

The report identified three broad areas of regulatory policy: traditional regulation, including mandated standards and public education; carbon pricing, including carbon taxes and cap-and-trade programs; and innovation policy and subsidies. The report identified 124 traditional regulation policy developments worldwide since July 2008, 57 carbon pricing developments and 69 innovation policy developments.

"What's interesting is how much activity there has been in the traditional mandates and the innovation incentives and subsidies areas," Mr. Fulton said. "Carbon markets are important in the long run … but in the day-to-day investible markets, these mandates and these innovation policies are very important to keep markets moving at the moment."

And while market conditions and the liquidity crisis have been difficult on every economic sector, including climate change, Mr. Fulton said, the regulatory policies are laying the foundation for potential growth over the medium and long term.

"These are the sectors that can lead us out (of the financial crisis)," he said.

Equities, PE, VC and infrastructure to get boost

Asset classes that could particularly benefit include public equities, private equity and venture capital, and infrastructure, the report identified. In public equities, cap-and-trade programs or carbon taxes can increase the value of so-called "clean" businesses.

Also, policies such as feed-in tariffs (programs in which regional or national electric utilities are required to buy renewable electricity at above-market rates set by the government), tax credits and mandatory standards create demand for "green" products and services.

In private equity and venture capital, research and development incentives and subsidies are supporting innovation and the scaling-up of cutting-edge "clean" technologies such as renewable energy (wind power, solar power, biomass, hydropower, biofuels), information technology, green transportation, electric motors, lighting and clean technology manufacturing.

In infrastructure, feed-in tariffs and tax credits make climate change-related projects economically sound and mandatory standards require the scale-up of green industries.

About 13.5% — or $106 billion — of the $787 billion economic stimulus package signed into law by President Barack Obama on Feb. 17 is committed to green, climate change-related initiatives, the report said. Of that, $85 billion is dedicated to direct spending measures, including $18 billion for mass transit, and $21 billion for renewable energy tax breaks.

Among other items, the report identified $11 billion in the stimulus package dedicated to electric power grid investment, $8 billion to capital assistance for high-speed rail corridors and intercity rail services, $6.9 billion to the Federal Transit Administration's transit capital assistance, $6.3 billion to energy efficiency and conservation grants, $6 billion to renewable energy and transmission loan guarantees, $6 billion to nuclear waste cleanup and $5 billion to weatherization assistance program.

The report also tracked several non-U.S. initiatives, including the €200 billion ($257 billion) stimulus package proposed by the EU Commission in November, which included €4 billion in low interest loans to promote "the safety and environmental performance of cars" and €10.6 billion to other green technologies, such as energy efficiency in buildings.

"While there has been a lot of focus on the U.S. initiatives, we think it is very important to put it into a global context," Mr. Fulton said.

Green ideas in China stimulus not clear

The report separated China from the $212 billion it identified globally for green initiatives, because it is not obvious with the information available how much of the country's $586 billion stimulus package announced in November would be considered green, Mr. Fulton said. But the report did identify about 12% of the package as being targeted at energy efficiency and environmental improvements. That included $70 billion to upgrade and integrate the national electric power grid, $29 billion for power plants, including a number of nuclear plants and a natural gas pipeline, and $2.9 billion for water conservation and irrigation projects.

The four main investment themes that governments are focused on worldwide, according to the report, are the promotion of solar and wind energy, the installation of energy-saving light bulbs (called advanced lighting initiatives in the report), investments in improving electric grids and the development of clean automobiles that run on batteries.

"We believe this trend toward greater regulation will provide crucial support to climate change industries during the current global economic downturn," the report said. "Coupled with increased government spending on key climate change initiatives as part of economic stimulus packages in countries such as the U.S. and the UK, this should provide a boost to 'green' industries in contrast to other sectors of the global economy affected by recession."

Contact Jennifer Byrd at jbyrd@pionline.com

 

http://www.pionline.com/apps/pbcs.dll/article?AID=/20090225/REG/902259997/1007

Green" Illusions

"Green" Illusions

By Kenneth P. Green

Posted: Wednesday, February 25, 2009

ARTICLES

Windsor Star

Publication Date: February 23, 2009

Resident Scholar

Kenneth P. Green

Ontario Premier Dalton McGuinty has run afoul of two fallacies which plague governments with his new Green Energy Act.

The Act, which does not have a defined pricetag, would supposedly create 50,000 new jobs, putting people to work building windmills, solar power plants and bio-fuel plants.

Governments cannot create jobs, and labelling them "green" doesn't change the basic dynamics.

The Green Energy Act, he claims, will lead Ontario out of its recession and into a glorious future of clean energy.

Now, everyone would love to end the recession and enjoy clean, abundant and affordable energy. But there are some hard realities that suggest Premier McGuinty's plan isn't the smartest way to do it.

Let's review the reasons why governments cannot create jobs, and why labelling them "green" doesn't change the basic dynamics.

Let's start with the fallacy that governments can create jobs. This fallacy was exploded all the way back in 1845 by a French politician and political economist named Frédéric Bastiat. Bastiat pointed out that the only way governments can create jobs is by first obliterating other jobs.

Sometimes, they obliterate other jobs by diverting taxpayer money away from the economic uses the taxpayer would have pursued if they had kept their taxes.

Other times, they obliterate jobs by imposing regulations that kill off one industry in favour of another. In still other situations, they impose mandates, such as using recycled paper to create an artificial market for recycled paper which reduce jobs in fresh-paper production.

In the green energy case, they are doing all of the above: Taxpayer dollars are being used to subsidize the renewable energy sector; damaging regulations are being implemented on the traditional fossil fuel sector, and mandates for the use of renewable energy are being issued, creating a false market in wind power at the expense of fossil fuel and nuclear power. Governments also invariably siphon off a good part of the money for "administration," creating civil service jobs that pay comparatively higher wages than the private sector for similar activity.

Inevitably, government efforts to create jobs cost the economy jobs and, adding insult to injury, divert limited resources to inefficient uses, causing economic underperformance.

Now, let's look at the second fallacy: Call it "green" and, somehow, the fundamental laws of economics are suspended and we can all enjoy a free lunch and a utopian future of affordable, abundant and clean energy.

Of course, the only way to arrive at this fallacy is by inflating the expected value of green energy activities over the expected value from a non-green alternative.

In the premier's Green Energy Act, the expected value would result from a reduction of greenhouse gases related to energy production.

There's only one problem: The amount of greenhouse gases that Canada could eliminate, even if the entire country simply shut down, is not sufficient to retard global warming in any significant way.

Canada's fossil-fuel greenhouse gas emissions account for about two per cent of world emissions. Ontario's emissions are only seven-tenths of one per cent of the world total. China, which is building a coal power plant every week, emits more than 10 times all of Canada's greenhouse gases, and shows no signs of curbing its appetite any time soon.

Ontario's Green Energy Act will offer virtually no climate change protection or delay in warming, and no benefit to offset the costs of raising Canada's energy prices, raising the cost of goods and services, and rendering Canadian exports less competitive in world markets.

The premier, along with others such as U.S. President Barack Obama, has internalized the twin fallacies of job creation and a free lunch. He needs to undergo a reality check before he squanders limited resources and worsens the economic prospects for North America.

Taking actions to raise the cost of energy using a fallacious job-creation approach and fallacious benefit claims will only exacerbate Ontario's suffering in the ongoing world economic downturn.

Kenneth P. Green is a resident scholar at AEI.

from : http://www.aei.org/publications/filter.all,pubID.29443/pub_detail.asp

Ban on plastic bags makes HP clean

Ban on plastic bags makes HP clean

Shimla, Jan 19: The hills are looking clean again. Once an eyesore, littering the verdant mountain slopes, choking drains and scarring the environment, plastic pollution has come down dramatically in Shimla and other parts of Himachal Pradesh, four years after this north Indian state banned the use of small polythene bags.

"Before the implementation of the ban, polythene pollution was a major problem in the state," R.K. Sood, joint member- secretary of the Himachal State Council for Science, Technology and Environment, told.

Describing the scene before the ban was imposed, he said: "Plastic bags littered the hillsides. During the monsoon, the rain water brought along heaps of polythene bags and other non-biodegradable material that choked most of the municipal drains. Now, the problem has been solved to a great extent."

Himachal Pradesh was the first state in India to ban the production, storage, use, sale and distribution of small polythene bags in June 2004.

Under the Himachal Pradesh Non-Biodegradable Garbage (Control) Act of 1995, any violator trespassing faced a fine up to Rs.25,000. The minimum fine was fixed at Rs.500.

"The ban on use of coloured polythene bags manufactured from recycled plastic was initially imposed on Jan 1, 1999. Later in 2004, the ban was imposed under Section 7(h) of the State Non-Biodegradable Garbage (Control) Rules on the use of polythene bags having thickness less than 70 microns and size less than 18"x12"," Sood said. As a result, paper and jute bags are now back in the state.

Sanjay Verma, project officer with the state Department of Environment Science and Technology, said: "Initially, it was a herculean task to enforce the ban. Special sensitisation drives were launched across the state to educate the common man about the ecological hazards and about which type of bags were exempted from the ban and which were not."

About 20 government officials were empowered at the district and sub-divisional level to ensure effective implementation of the ban."Still, 25 to 30 people are fined on an average every month in the state," Verma said. He said the problem is still acute in areas located along neighbouring Punjab and Haryana.

"The use of polythene continues in the border areas of the state. The problem can be checked when the neighbouring states enforce the ban too. Moreover, tourists generate more plastic during the peak season than the locals during the entire year," he said.

To dispose of Shimla's polythene waste, private firm Gujarat Ambuja Cements Ltd(GACL) joined hands with the city's municipal corporation in July last year as part of corporate social responsibility.

"As part of the understanding, we (GACL) are regularly getting truckloads of polythene waste that is scientifically burnt at our Darlaghat unit in Solan district," GACL official Sandeep Kapoor said.Around 1.5 to 2 quintals of polythene waste is collected daily in Shimla alone.

State Forest Minister J.P. Nadda said the state would soon have its environmental master plan to tackle critical areas of environmental degradation. "The master plan will include a baseline study of the environmental vulnerabilities and details of measures to tackle problems mainly related to urban solid waste, industrial pollution and ecological degradation caused by hydropower projects," he said.

IANS

resource: http://www.zeenews.com/sci-tech/eco-news/2009-01-19/499827news.html