Business As Usual

The phrase “business as usual” will be one familiar to anyone who has spent some time mulling over the contents of the various Nationally Determined Contributions (NDCs) submitted to the UN Secretariat pursuant to the provisions of the Paris Agreement. The context there is of (usually, developing) countries seeking to avoid any particular commitment to reducing their greenhouse gas emissions (GHGs), while appearing to be offering to do something. This is where “business as usual” (BaU) comes in. By postulating significant increased national emissions in years to come under a BaU scenario, they can then offer a reduction (often relatively small, or conditional on funding) against that BaU outcome. This usually has the effect of seeing significant increases in the country’s GHGs, while nevertheless offering up the vision of some sort of a cut. Indonesia’s NDC does that, for instance (see more below). However, what I want to talk about is the return to business as usual all around the world, in short order – in fact within a few days – of the signing of the Glasgow Climate Pact.

US to release oil reserves in attempt to lower prices

This is the heading to an articlei which appeared on the BBC website on 23rd November 2021, i.e. just three weeks after US President Joe Biden left for home from Glasgow and COP 26 where he “…warned that the climate crisis poses “the existential threat to human existence as we know it” and urged other world leaders to embark upon a transformational shift to clean energy…”ii.

Given President Biden’s attempts to claim the climatic moral high ground both in the run up to COP 26 and while there, what follows does seem a little strange to anyone who took him at his word. And yet we find:

The US has said it is releasing 50 million barrels of oil from its reserves in an attempt to bring down soaring energy and petrol prices.

The move is being taken in parallel with other major oil-consuming nations, including China, India, Japan, South Korea and the UK.

US President Joe Biden has repeatedly asked the Opec group of oil-producing nations to boost output more rapidly.

Oil – and lots of it – is apparently good.

In a statement the White House said: “American consumers are feeling the impact of elevated gas [petrol/diesel] prices at the pump and in their home heating bills, and American businesses are, too, because oil supply has not kept up with demand.

“That’s why President Biden is using every tool available to him to work to lower prices and address the lack of supply.”

Unfortunately, it seems that the plan hasn’t had the desired effect. The BBC’s Scottish Business/economy editor, Douglas Fraser, wrote a follow-up articleiii on the next day in which he observed:

It didn’t go to plan. The market responded by pushing the spot price up by nearly $3 a barrel, so that it currently trades above $82.

So much for the Guardian articleiv (Will the coronavirus kill the oil industry and help save the climate?) which I criticised in “Oil Is Dead, Long Live Oil”v. It is more than a little ironic that the Guardian article included this:

Adding fuel to the fire of the pandemic is the price war being waged by Saudi Arabia and Russia, who increased production just as the pandemic slashed demand, sending prices towards the floor. The moves are seen as an attempt to grab market share by killing the higher cost producers behind the US shale boom.

The irony is that OPEC, which includes Russia and Saudi Arabia, is now agreeing to increase production only slowly. Presumably the oil-producing countries have worked out (after all, it isn’t difficult) that oil is far from dead, and that after a lean year/18 months the good times have returned. Maintain production at levels that keep the price high and they make good profits while maintaining their reserves. It’s pre-pandemic business as usual, and COP 26 has made not a blind bit of difference to it.

And as Douglas Fraser has very clearly seen, and points out:

All this seems a long way from the COP26 summit, when President Biden and many others were agreeing that oil and gas have to shrink massively, and not talking about supplying the market with more crude oil to help keep prices down.

It’s also a long way also from the pressure on the UK government to stop consent from new drilling and enhanced production.

Under short-term pressure, political leaders are likely to favour lower prices over lower emissions.

Ahead of the decision on whether to green light the Cambo gas field, west of Shetland, another significant voice is calling for continued drilling by the oil and gas industry in UK waters.

Tim Eggar used to be energy minister in the Conservative government of the 1990s. He is now chairman of the Oil and Gas Authority (OGA).

At a conference in London on Wednesday, he had two key messages. Following petrol shortages and with gas prices soaring: “Security of supply is back in vogue”.

The need for oil and gas to fuel transport, industry and heating will remain “for the foreseeable future,” he said.

And so, he argued, it’s better to produce it in UK waters, with lower emissions than arise from transporting it from other countries.

US auctions off oil and gas drilling leases in Gulf of Mexico after climate talks

This is the heading to an articlevi that appeared in the Guardian on 17th November 2021, just two weeks after US President Joe Biden returned to the USA from Glasgow. The period between the signing of the Glasgow Climate Pact and President Biden’s announcement was even shorter, as the Guardian report tells us:

Just four days after landmark climate talks in Scotland in which Joe Biden vowed the US will “lead by example” in tackling dangerous global heating, the president’s own administration is providing a jarring contradiction – the largest ever sale of oil and gas drilling leases in the Gulf of Mexico.

The US federal government is on Wednesday launching an auction of more than 80m acres of the gulf for fossil fuel extraction, a record sell-off that will lock in years, and potentially decades, of planet-heating emissions.

The enormous size of the lease sale– covering an area that is twice as large as Florida – is a blunt repudiation of Biden’s previous promise to shut down new drilling on public lands and waters. It has stunned environmentalists who argue the auction punctures the US’s shaky credibility on the climate crisis and will make it harder to avert catastrophic impacts from soaring global heating.

It’s worth putting this in some sort of perspective, and the Guardian helpfully does so:

…the Department of the Interior, which oversees public lands and waters, has estimated there is as much as 1.12bn barrels of oil and 4.2tn cubic ft of gas available for extraction. A separate lease sale offered by the government in Alaska’s Cook Inlet will offer up another 192m barrels of oil and 301bn cubic ft of gas to drillers.

Combined, these leases would result in nearly 600m tons of planet-heating gases if fully developed over the next four decades, which is more than the total annual emissions of the UK.

This is deliberately exaggerating the scale of the issue – forty years’ worth of emissions being compared to one year’s emissions from the UK. However, it does come on top of the USA’s substantial pre-existing GHG emissions, and it does make a mockery of President Biden’s claims to “climate leadership”.

Indeed, as the Guardian stresses:

Critics say a worrying pattern has emerged during Biden’s tenure, with his administration handing out drilling permits at a rate of more than 300 a month since his inauguration, a faster pace even than under Donald Trump.

At the Glasgow talks, known as Cop26, the US also declined to sign on to an agreement to end coal mining, or to phase out gasoline and diesel cars.”

It seems that despite the substantial change in the USA’s Presidential leadership (Biden is – or at least is supposed to be – a rather different character from the much-maligned Trump), it’s still business as usual.

Polluting greenhouse gases being sold online and smuggled to UK

This is the heading to an articlevii which also appeared on the BBC website on 23rd November 2021. Unusually, given how the BBC and the Guardian so often seem to be in lock-step, I can’t say I’ve noticed this at the Guardian website. Perhaps it’s because the BBC made a bit of a song and dance about it (it was splashed all over radio and TV news bulletins on the BBC on that day) because it’s the result of a BBC investigation. The article explains the background thus:

Hydrofluorocarbons (HFCs) were developed as alternatives to ozone-depleting chemicals, which were banned under a global 1987 agreement known as the Montreal Protocol.

The deal banned the use of chlorofluorocarbons (CFCs), which were gradually replaced by HFCs.

HFCs are man-made, colourless and odourless.

They are mainly used in air conditioning, industrial chillers and fridges and can also be found in some aerosol propellants and fire protection fluids.

But they are powerful greenhouse gases, with some HFC blends thousands of times more potent than carbon dioxide.

Scientists previously discovered HFCs contribute to global warming by trapping heat radiating off the Earth.

The UK aims to reduce the use of HFCs by 69% by 2024.

Am I alone in a sense of deja vu? CFCs were bad for the ozone layer, therefore we replaced them with HFCs, but oh dear, HFCs are bad for global warming. It’s all a bit like when Gordon Brown as UK Chancellor of the Exchequer, at the urging of experts, reduced taxes on diesel cars because the experts assured him that they were better for global warming. But then, alas, we now find that diesel cars are otherwise polluting and the work of the Devil:

Gordon Brown introduced tax breaks for diesel cars as the UK chancellor in 2001 because they emit less CO2 than petrol-powered cars, but it is now known that they emit other harmful pollutants, known as nitrogen oxides.viii

I digress. Back to HFCs. This, apparently, is the problem:

The BBC’s investigation began at the Romania-Ukraine border, where HFCs made in China have been smuggled through in the boots of cars or in lorries.

We found scores of online adverts posted by local traders offering the gases for sale and met one trader, called “George”, who said he could get large quantities of HFCs.

After directing us to a quiet country road near the border crossing, he opened the boot of his car to reveal two canisters containing HFCs.

He offered them for roughly £100 each. They sell on the UK’s illicit market for up to £240.

HFCs made in China.” China, China, China. China joined with India in watering-down the Glasgow Climate Pact’s references to coal. Despite lots of political differences in many areas, China joined with Joe Biden in agreeing measures to try to increase supply and reduce the price of oil. And now we find China manufacturing these nasty HFCs. Business as usual.

Coal

According to Carbon Briefix (reporting what was said by China’s National Development and Reform Commission) China’s daily coal output this month has set a “historic new high” as part of efforts to ensure “energy security”. Apparently 360m tonnes of raw coal were produced in China last month, a rise of 4% on last year and 5.5% compared to 2019. Not content with that, China also imported almost 27m tonnes of coal in October 2021, almost double its coal imports in the same month in 2020. According to Reuters, the reported daily output was the highest since at least March 2015.

Efforts in China continue, to increase supplies of both coal and gas, in readiness for the upcoming peak winter months. China’s state grid has been warning of possible local electricity shortages.

Business as usual.

Meanwhile, in India, according to the Hindustan Times on 24th November 2014x:

Union minister for coal Pralhad Joshi on Monday asked the Coal India Ltd (CIL) and its subsidiaries to make “all out efforts” to ensure at least 18 days of coal stock with thermal power plants by the end of November.

The state-owned CIL has been prioritising the supply of coal temporarily to power producers to refill the reducing stocks of coal with them, news agency PTI reported.

During his virtual address during the 47th foundation day of CIL, the minister also called upon the central government subsidiary to increase its production to one billion tonnes by the end of 2024.

Business as usual.

There is, rightly I think, considerable focus on China and India with regard to coal use, but let’s not forget Indonesia. According to local publication, Mongabayxi:

Indonesia’s commitment [to phase out its coal-fired power plants by the 2040s] is so riddled with caveats that it makes the effort essentially “useless” — in particular the fact that the country is on track to add more coal capacity by 2030 than it plans to retire.

The government of President Joko Widodo is also betting big on giving the coal industry a second life through coal gasification, a process that yields a cleaner-burning fuel, but which, in producing it, is even more carbon-intensive than just burning coal.

Other measures the government is rolling out to keep coal plants burning longer include co-firing, where wood pellets are burned alongside coal, and the use of carbon capture technology criticized as unfeasible at scale.

And:

Indonesia has also made clear it’s not committing to the entirety of the pledge it just signed in Glasgow. Among the clauses that it refused to sign is one that would have obliged it to “cease issuance of new permits for unabated coal-fired power generation projects, cease new construction of unabated coal-fired power generation projects and to end new direct government support for unabated international coal-fired power generation.”

Business as usual.

Conclusion

In the UK, however, things are different. Net zero is being extolled, while energy prices reach new highs. Business is struggling. Energy supply companies are going bust at an unprecedented rate (another two went bust only todayxii), there have been (ironically) shortages of CO2xiii in September this year and petrol and diesel shortages (whatever their cause), all point to a country that is definitely not enjoying business as usual.

Actions speak louder than words. For all the hype around COP 26, the Glasgow Climate Pact is essentially meaninglessxiv. Even US President Joe Biden talks the talk but doesn’t walk the walk. Others don’t even talk the talk. It’s time for the UK establishment to realise that their “net zero” agenda is a suicide pact that nobody else has signed (though maybe Germany has just joined in…xv).

Endnotes

i https://www.bbc.co.uk/news/business-59353194

ii https://www.theguardian.com/environment/2021/nov/01/biden-cop26-speech-climate-change-action-us-lead-example

iii https://www.bbc.co.uk/news/uk-scotland-59406217

iv https://www.theguardian.com/environment/2020/apr/01/the-fossil-fuel-industry-is-broken-will-a-cleaner-climate-be-the-result

v https://cliscep.com/2021/09/30/oil-is-dead-long-live-oil/

vi https://www.theguardian.com/us-news/2021/nov/17/biden-administration-gulf-of-mexico-oil-gas-drilling-leases

vii https://www.bbc.co.uk/news/uk-59061805

viii https://www.theguardian.com/business/2015/oct/01/uk-government-wrong-to-subsidise-diesel-says-former-minister

ix https://www.carbonbrief.org/china-briefing-18-november-2021-xi-biden-meeting-methane-emissions-historic-new-high-for-coal

x https://www.hindustantimes.com/india-news/pralhad-joshi-asks-coal-india-ltd-to-ensure-power-plants-have-18-days-of-stock-by-november-2021-101635773501707.html

xi https://news.mongabay.com/2021/11/cop26-cop-out-indonesias-clean-energy-pledge-keeps-coal-front-and-center/

xii https://www.bbc.co.uk/news/business-59414799

xiii https://www.bbc.co.uk/news/explainers-58626935

xiv https://cliscep.com/2021/11/20/the-partys-over/

xv https://www.bbc.co.uk/news/world-europe-59399702

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November 25, 2021 at 02:24PM

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