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Report Warns Of Greenhouse Gas Leap

Chris Buckley – Reuters | October 22, 2008

BEIJING (Reuters) – China’s greenhouse gas pollution could double or more in two decades says a new Chinese state think-tank study that casts stark light on the industrial giant’s role in stoking global warming.

Beijing has not released recent official data on greenhouse gas from the nation’s fast-growing use of coal, oil and gas. Researchers abroad estimate that China’s carbon dioxide emissions now easily outstrip that of the United States, long the biggest emitter.

But in a break with official reticence, researchers from the Chinese Academy of Sciences and other major state-run institutes have concluded that, without dramatic counter-steps, their nation’s emissions will tower over all others’ much sooner than an earlier government forecast.

The projected leap in emissions underscores the pressures that China will face in looming climate change negotiations, and the immense challenges it would face in meeting any commitments.

By 2020, China’s burning of fossil fuels could emit carbon dioxide equal in mass to 2.5 billion metric tonnes of pure carbon and up to 2.9 billion tonnes, depending on varying scenarios for development and technology. By 2030, those emissions may reach 3.1 billion tonnes and up to 4.0 billion tonnes.

That compares with global carbon emissions of about 8.5 billion tonnes in 2007. Emissions are also often estimated in tonnes of Co2, which weighs 3.67 times as much as carbon alone.

The report does not give its own estimate of China’s current Co2 emissions, but cites data from a U.S. Department of Energy institute that put them at 1.4 billion tonnes of carbon in 2004.

The U.S. Oak Ridge National Laboratory estimated that the United States emitted about 1.6 billion tonnes of carbon in 2007, compared to China’s 1.8 billion tonnes.

The “China Energy Report” for 2008 warns of drastic risks from inaction in the face of this projected growth, and yet also says economic development must not be hobbled.

“No matter how historical responsibility is defined, our country’s development path cannot repeat the unconstrained emissions of developed countries’ energy use,” states the Chinese-language report, which recently went on public sale without fanfare.

“Therefore, we must soon prepare and plan ahead to implement emissions reduction concepts and measures in a long-term and stable energy development strategy.”

The main author, Wei Yiming, has participated in a U.N. scientific panel to assess global warming. He was not immediately available for comment on the findings and why they appeared now.


The study may add to contention over China’s response to global warming at a time of accelerating international negotiations. Beijing will be at the heart of efforts to forge a treaty next year to succeed the first phase of the Kyoto Protocol, which expires at the end of 2012.

The European Union this week said developing countries should accept a 15-30 percent cut in their greenhouse gas emissions from “business-as-usual” levels.

But under the Protocol, a U.N.-led pact, poor nations do not assume targets to cap emissions. And Washington has refused to ratify Kyoto partly because it says the treaty is ineffective without Beijing’s acceptance of such mandatory caps.

Carbon dioxide and other greenhouse gases trap solar radiation, heating the atmosphere and threatening to stoke worsening drought, disrupted rainfall and more wild weather.

But China points out that per capita emissions of its 1.3 billion people are much lower than rich countries’ and says the developed countries bear overwhelming responsibility for the dangerous accumulation of greenhouse gases.

The new study backs that argument.

Beijing officials have also often said they will not sacrifice hard-won economic development to greenhouse gas caps.

For China, “relative to reducing carbon dioxide emissions, economic development is even more important,” the study says.

China Is No Leading Light In Energy Efficiency

JIM LANDERS – Dallasnews | Tuesday, August 19, 2008

BEIJING – China’s ballooning appetite for energy has helped push global prices higher for oil and coal, much of which is wasted.

Energy efficiency in China is just a fifth of U.S. levels. The government has put a priority on improving that by closing hundreds of small, coal-fired power plants and steel mills, raising fuel economy standards and consumption taxes on gas-guzzling cars, and pushing stores and apartment owners to replace incandescent bulbs with green ones.

But energy policy made through government fiat will only take you so far. Even as Beijing issues decrees about reducing the amount of energy used, it still subsidizes gasoline and electricity, and it’s falling short of its conservation targets.

Free-market economists – including some Chinese advisers to the communist government – argue that price is the best way to save energy. High prices have pushed down U.S. oil consumption about 3 percent this year, the biggest drop in a generation.

China’s motorists pay about $3.40 a gallon for gasoline – up 17 percent in the last two months – but that’s less than U.S. prices, and it hasn’t done much to slow oil consumption or car purchases.

(The price is also far less than the $8-a-gallon price in Hong Kong, where the government is trying mightily to discourage people from buying cars.)

China’s government finds it difficult to let go of price controls because some companies say higher energy costs are forcing them to close factories and move to cheaper locations such as Vietnam, eliminating thousands of jobs, said Huang Fanzheng, a senior adviser to the Chinese government and one of China’s most respected economists.

“So we should not only consider the influence of price on consumption, but also consider how much companies can bear, including foreign companies,” he said.

Price controls have other distorting effects. China imports most of its oil. China’s refiners pay world prices for those imports but collect far less from gasoline consumers. The losses are usually covered by government cash, but that’s no sure thing.

One result is an incentive to sell cheap, low-quality gasoline. It also discourages refiners from investing in expensive technology to eliminate pollutants such as sulfur, which automakers say ruins their more advanced emissions controls.

So while Beijing has ordered China’s governors to cut air pollution by 20 percent over the next decade, the oil refiners won’t be much help.

Nor will the power companies. China leads the world in renewable energy used for electricity generation, with 152 gigawatts of power from sources including wind, nuclear and hydro. (One gigawatt is 1,000 megawatts, or roughly the size of a large power plant.)

But China is the world’s biggest consumer of coal. Eighty percent of its electricity comes from coal-fired power plants. Although coal is the country’s most abundant energy resource, China has been a net coal importer since 1992. Smoggy Beijing has giant coal smokestacks peeking out among the city’s skyscrapers. Most of those power plants are shut for the Olympics, but they’ll fire up again once the games are over.

Wang Jiacheng, deputy director of the government’s Academy of Macroeconomic Research, says China’s per-capita electricity use has climbed an average of 10.28 percent a year since 1990.

Coal importers, like oil importers, pay world prices for supplies but get discount payments from customers. So China is going through a coal shortage. That’s pushing companies to curb production or switch to diesel-powered generators, one of the most energy-inefficient ways to produce electricity.

Asia Must Strike Right Balance On Oil Policy

Updated on Jul 29, 2008 – SCMP

Asian governments are acting irresponsibly in maintaining subsidies on oil. They believe that keeping prices down will promote development, control inflation and ensure stability. Each of these points is arguable. What is not, however, is that their efforts are encouraging abuse of a commodity that is in short supply, and diverting precious resources from vital sectors such as education and health.

High oil prices have forced some governments in the past two months to lower subsidies. The price caps they had in place were so hefty that to do nothing would have further eroded budgets. Domestic concerns were behind their moves – yet it is global reasons that should be driving their policies. Subsidies increase consumption and this is helping push prices higher.

Asia accounts for just 20 per cent of world oil use. There is no denying that it is the US and other developed countries that by far consume greater quantities. But it is taxes, not subsidies, that generally determine prices in these nations, and in the absence of concerted government intervention, people are being more careful about oil use. In Asia, the opposite is true; about two-thirds of the annual increase in global oil demand is from our region. The percentage for imports is even bigger.

China is perhaps the only Asian country able to withstand record oil prices and maintain present subsidies. Yet on June 20, Beijing announced an 18 per cent increase in the price of diesel and a 5 per cent rise in electricity charges on the mainland. The move followed on the heels of Taiwan, India, Indonesia and Malaysia. The steps were small, but necessary. Further cuts are needed; the aim should be to eventually scrap subsidies.

Capping oil prices in developing countries benefits a minority. On the mainland, the winners are big industry and the privileged few who can afford vehicles. The losers are the government and the petroleum companies forced to take a cut in income. Leaving prices to market forces would achieve the central government’s wishes to keep growth in check and decrease pollution levels. Throughout the region, the diversion of large chunks of budgets to keeping oil prices down is preventing the development of social sectors. In India and Indonesia, funding that should be going to education and health care is instead being used to keep motorists on the road. Malaysians have some of the cheapest petrol and highest per capita vehicle ownership. Rather than subsidising oil, governments should be improving living standards and trying to tackle global warming.

Ministers from China, India, Japan and South Korea met US Energy Secretary Samuel Bodman in early June and acknowledged in a statement that “phased and gradual withdrawal of price subsidies for conventional energies is desirable”. Subsidies, they said, “should be replaced, where possible, by better targeted policies for intended beneficiaries”. Efficiency would be enhanced and the door opened for greater investment in alternative energy sources. Japan is already one of the world’s most fuel-efficient countries. China and India refused to commit to a timetable.

Asia’s developing nations are taking the right steps, but small ones – and not necessarily for the right reasons. They should be looking as much at conservation and responsible use of oil as growth and inflation rates. Social development must not be ignored. Only by casting off subsidies can they move onto the right track. Such a decision has to be gradual and may seem filled with uncertainty. It is nonetheless the only sustainable way forward.

The Village That Aims for Energy Autarky

Monday 23 June 2008 – truthout

by: Jean-Pierre Stroobants, Le Monde

“Mir hunn energie!” – “We have energy!” The slogan is everywhere in Beckerich. On building facades, official documents, in the heads of ecologist Deputy-Mayor Camille Gira’s fellow citizens. This fiftysome-year-old, who boils over with ideas and plans, has set an objective for his rural commune, located in the west of the Grand Duchy of Luxembourg: energy autarky.

To give the 2,700 inhabitants mastery over their energy supply “instead of depending on Arab Sheikhs,” as he says. This warm, direct and patient man has worked toward that end for a quarter century, since he became first alderman (assistant mayor), then burgomaster of this rural burg, situated a stone’s throw from the Belgian border.

In these times of steep rises in energy prices, with a liter of heating oil in the Grand Duchy at .90 euros – versus .30 euros five years ago – Camille Gira is not the type to gloat. But he knows that he was right to develop – among others – a system of urban heating based on bio-methanization. Some 90 percent of Beckerich households are now connected to that system and save some 500 euros each and every year compared to the cost of average heating oil consumption.

“The money is obviously not the only factor that must be taken into consideration,” the mayor emphasizes. “I am concerned about environmental and social questions, but I’ve learned to use concrete arguments first of all. Then, to act in such a way that once they’ve joined the program, citizens have no further practical worries.” So, they sign a co-ownership contract for one of the photovoltaic installations on the public buildings made available to them for free and they don’t have to worry about anything else. A public governing body will manage all these little independent solar energy producers’ interests and formalities.

On the commune’s heights, Constant Kieffer is more than a little proud to show what he calls “the cow’s stomach.” With a half-repressed smile and elfin eye, the Biogas manager likes nothing more that to observe the face of visitors when they first observe the bacterial action in his digester through a peephole. Liquid manure, vegetal waste and vegetable oils are poured into this enormous vat covered with a dome, a medium brought to 38 degrees centigrade and deprived of oxygen. At the end of 40 days, biogas is released, which, when burned, will produce electricity for 700 households and hot water for the heating network: 24 kilometers of pipes that enter houses and supply radiators and water heaters. The residue will be used as fertilizer.

To realize his plan, Camille Gira convinced 19 farmers to found a cooperative and invest 5 million euros. Some went so far as to mortgage their farms, but none have expressed the slightest regret: the success has far exceeded their hopes. “When they saw this unit go up, people really began to adhere to our plans,” Camille Gira notes.

Today, demand in the commune is such that Biogas no longer suffices. So, a little further down the road, a team of workmen from Austria are raising a 30 meter high furnace. Starting in October, it will burn wood chips that will provide heat. The wood will come from the 700 hectares of communal forest, 400 hectares of which belong to 260 private owners. City Hall has proposed that they sell or exchange their land. It has also decided to inaugurate 15-year contracts based on barter: the owners will be able to choose to supply wood in exchange for a reduction in their energy bill.

Christian Seidel, a village resident, was one of the first to believe in City Hall’s green energy projects. He paid 2,300 euros and exchanged his oil-burning furnace for a one meter by one meter case in which the exchange of entering hot and departing cold water takes place. “With the network passing right in front of my house, the system requires neither upkeep on a furnace nor chimney cleaning and I save some 400 euros a year,” he explains. Since then, Mr. Seidel, like 10 percent of the residents, has installed solar panels on his roof.

“It’s true people have stopped taking us for lunatics,” Camille Gira comments discreetly. In 1995, as a member of the project International Climate Alliance, he committed to reducing greenhouse gas emissions in Beckerich 50 percent by 2010. That goal will be reached. And autarky? “By 2020, perhaps, but what’s important is the goal, not the date,” the mayor maintains. He knows the rules of marketing, and knows that by setting such an objective for his fellow citizens, he fosters their mobilization.

In the years to come, he is promising them access to wind power. He induces them to change out their electric appliances with bonuses – 38 euros for the purchase of a low-energy refrigerator – to renovate their homes by insulating them better, recover rain water etc. Beckerich households’ electricity consumption has, in any case, dropped 7 percent per year since 1994, while it has grown 2-3 percent in the rest of the country.

Because City Hall knows that’s it’s always necessary and good to provide an example, it everywhere practices what it preaches. At the Oberpallen School, the paints used are mineral-based and the electric cables without PVC. The Sports Center is insulated with a thermally-treated wood that makes it durable. In the commercial area, the main building has a wood frame, triple glazed windows, and a geo-heat, cooling and ventilation system. At the Dillendapp Center, where school-age children go before and after school hours so their mothers may freely work, the lighting system is self-regulating and the air constantly renewed.

From a window in this magnificent building, Camille Gira shows another of his accomplishments: a dedicated section of forest that allows cave swallows, a threatened species, to continue to nest on the ground. “Maybe we’ve already missed the climate change train. But at least I will have demonstrated that it’s possible to change a society, even one that is well-known as conservative,” he concludes.

Royal Dutch Shell and the struggle for Iraqi oil

Despite growing popular opposition, the Dutch government coalition of the Christian Democrats (CDA), Social Democrats (PvdA) and Christian Union (CU), under Christian Democratic Prime Minister Jan Pieter Balkenende, continues to provide military support to US imperialism in the Middle East and Central Asia.

One of the greatest beneficiaries of this support for American militarism is the oil multinational Royal Dutch Shell. The company was driven out of Iraq by the nationalisation of the oil industry in the 1970s under Saddam Hussein. Now, this Anglo-Dutch company is again preparing to exploit the most profitable oil fields in Iraq.

The Dutch army in Afghanistan and Iraq

One year after the launching of the Afghanistan war in 2001, the Dutch government deployed troops to that country, where they functioned under US command. Additionally, starting in July 2003, more than 1,200 Dutch soldiers were deployed to southern Iraq. Officially, their mission was to protect a Japanese brigade of engineers. In April 2005, the Dutch troops were withdrawn from Iraq. The same year, approximately 600 soldiers were sent into the Kabul area of Afghanistan as part of the United Nations’ International Security Assistance Force mission. The government in The Hague also made two frigates available.

At the beginning of 2006, the US requested further troops for Afghanistan from its ally. Balkenende immediately expressed his agreement. He received support from the then-opposition Social Democrats and their chairman Wouter Bos. Some 80 percent of the deputies in the Netherlands parliament at that time voted to send more troops to Afghanistan.

In May 2006, the Netherlands reinforced its troop contingent in the Uruzgan province to 2,000 soldiers, armed with self-propelled howitzers, six combat helicopters and eight F-16 fighter jets. The 2,000-strong Dutch contingent (from a country of only 16 million inhabitants) represents approximately 10 percent of Holland’s armed forces placed at the disposal of the US. The Netherlands thereby has the fourth largest deployment of foreign troops in Afghanistan.

Starting this spring, Dutch troops have also been participating in NATO’s “Achilles” offensive, which unleashed a new and more intensive wave of violence on the country.

This summer, the Dutch parliament must again decide on extending the military deployment in Afghanistan. Last year, 70 percent of the Dutch population opposed the parliamentary vote to send more troops to Afghanistan.

According to media reports, opposition to the military operation is again approaching this high point after two Dutch soldiers were killed in June, and Dutch troops have become increasingly embroiled in fighting. Nevertheless, it is expected that the government in The Hague will push for an extension of the operation.

Why does the government of a small country like the Netherlands uncritically support the Bush regime militarily in the face of large popular opposition? The answer is to be found in the efforts of oil giant Shell to set foot once again in Iraq.

Shell attempts to fill its own barrels with Iraqi oil

Royal Dutch Shell was active in Iraq in the 1920s, profiting from the exploitation of Iraqi oil for approximately five decades. Only the nationalisation of the oil industry in 1972 by the Hussein regime terminated this very lucrative business for Shell. Nevertheless, the oil giant never lost sight of Iraq over the following decades. Little wonder, since Iraq possesses the third largest proven reserves of oil and natural gas in the world. According to John Teeling, chairman of the English company Petrel Resources, active in the oil sector, “It costs $1 a barrel to get oil out in Iraq. If you’re getting $60 for it, that’s good economics. You don’t have to go to Harvard to figure that out.”

Starting in 1991, when economic pressure increased on the regime in Baghdad as a result of the sanctions imposed by the US and the United Nations, Hussein was again ready for foreign companies to participate in the exploitation of the country’s oil. In 1997, his government signed a contract with the Australian oil company BHP Billiton for the development of the Halfaya oil field. Soon afterwards, Shell bought a 40 percent share of this contract.

Economic sanctions, however, meant that the Australian company never had the opportunity to implement the contract. At the end of the 1990s, Shell’s Middle East manager Wolfgang Ströbl then began direct negotiations with the Iraqi oil ministry about expanding the company’s investments.

The beginning of the Iraq war in March 2003 put an end to that process. Shell’s efforts to re-establish itself in Iraq now depended on the Bush administration. Clearly, its ambitions would have been negatively affected by a government in the company’s homeland that was critical of the war.

At the same time, Shell was particularly eager to secure further exclusive oil and gas reserves. At company headquarters, it had long been known what became public knowledge in 2004: Shell’s worldwide secured oil reserves had to be revised downward by around 20 percent or 4.35 billion barrels. This caused a serious crisis for the company; its share price dramatically collapsed, and two members of the board had to resign.

Shell’s international lobbying

Earlier statements by Shell’s public relations department, claiming the company had no intention of re-entering the Iraqi oil sector, soon proved to be a smokescreen. With the first shots fired by American soldiers, Shell managers and lobbyists began the effort to secure a sizeable piece of the cake for the European energy giant.

Important elements in this lobbying network were and are the governments of Britain and the Netherlands—the two states in which the company is registered. Just a few days after the war began, Shell representatives went to Downing Street to see British Prime Minister Tony Blair. They insisted that the exploitation of Iraqi oil should not be left solely to American companies. The Dutch government accommodated the interests of the country’s largest transnational corporation by participating militarily in the US-led wars in Afghanistan and Iraq.

The close fusion of big business and politics is a fundamental characteristic of capitalism. Despite their global activities, the transnational corporations, including the oil giants, are dependent on the cooperation of governments, which increasingly become the lackeys of the largest and most powerful companies. This mutual support is expressed through an ever-closer exchange of personnel between the two. Politicians easily enter into the world of big business, managers move into politics.

For example, Wouter Bos, the chairman of the PvdA and currently deputy prime minister, before taking over the leadership of the Social Democrats, was a top manager with Royal Dutch Shell. For more than 10 years, he held various leading positions for the oil multinational, including as a political advisor to the company’s executive board, general manager in Romania and headhunter for leading personnel in East Asia.

In Britain, Shell managers sit on a series of government committees and taskforces. Policies are developed that benefit the company in bodies like the Renewable Energy Taskforce, the Advisory Committee on Business and the Environment or the Oil and Pipelines Agency, which comes under the auspices of the defence ministry. In the last two decades, four high-ranking foreign office civil servants moved on to become top managers at Shell or BP once they retired from their government jobs.

At a meeting in March 2003 in London, Malcolm Rifkind, a former foreign minister in the Conservative government of John Major, promised oil managers he would use his influence with US Vice President Dick Cheney to ensure European oil corporations gained contracts for some of the largest oil fields.

Philip Carroll, chairman of the board of Shell Oil, Royal Dutch Shell’s American subsidiary from 1993 to 1998, was appointed an advisor to the Bush administration for the Iraqi oil industry. Carroll played an important role in elaborating the new oil production legislation, which was then submitted to the Iraqi puppet regime in 2003.

As well as cooperating with the British and Dutch governments, Shell uses a network of lobbying organisations through which the corporation acts, to some extent also directly alongside its competitors. For example, these organisations include the US Council for International Business established in 1945, one of the largest American lobbying organisations, as well as the European Roundtable of Industrialists, the most influential lobby organisation in Europe.

The spearhead of Shell’s lobbying is the US-based International Taxation and Investment Centre (ITIC). This think tank is financed by Shell and six other oil corporations, and since June 2003 has developed the strategy for plundering Iraq’s oil wealth. The central plank of this strategy is a study prepared by ITIC in cooperation with the British government and the oil companies involved. Not surprisingly, the study comes to the conclusion that the reconstruction of the Iraqi oil industry requires direct investment by the major oil corporations. To secure such foreign investment, so-called Production Sharing Agreements (PSAs) are to be created, handing over large portions of Iraq’s natural wealth to the corporations involved.

The ITIC documents were submitted to the Iraqi finance ministry by the British ambassador in Iraq. In January 2005, British diplomats helped organise an ITIC conference in Beirut at which corporate oil executives met directly with Iraqi finance, oil and planning ministry officials to present their plans. The working out of an appropriate legal text was then arranged by the American consultancy company Bearing Point on behalf of the US government.

Along with the British government, the International Monetary Fund and the oil corporations, Bearing Point was directly involved in preparing draft legislation—long before any member of the Iraqi government or parliament saw the text of the law.

In February 2007, the Iraqi cabinet of Prime Minister Nouri al-Maliki accepted the draft legislation and submitted it to parliament. If parliament passes the legislation, nothing stands in the way of the oil giants exploiting Iraq’s resources, since the law sets out the necessary PSAs. More than 60 of the approximately 80 oil fields already developed are to be handed over exclusively to the oil corporations for up to 30 years; in addition, they will gain rights to all unexplored fields. After paying for all their running costs out of the revenues, 20 percent of the profits are guaranteed to the oil companies. Some calculate that, in reality, up to 70 percent of the profits will flow to the oil multinationals.

According to the Independent, the ITIC is currently planning a new conference with the participation of Iraqi officials and representatives of the oil corporations. Its main topic of discussion would be the formulation of future tax legislation and how this can complement the planned oil laws. The view of the corporations formulated by ITIC is clear: They want a total tax exemption on their profits from Iraqi oil.

Shell makes inroads into Iraq

Over the last years, Royal Dutch Shell has also prepared itself internally for its penetration of Iraq. In 2004, the company established the post of Iraqi chairman. It is the most senior post of all the company’s overseas enterprises.

Based in Dubai, this manager will head the oil and gas production for the company. The same year, the firm placed advertisements for an assistant to this chairman. This should be “a person of Iraqi descent,” with the “best contacts and insights into the network of significant families in Iraq,” explained the ad.

Since 2005, Shell has conducted technical studies into the Maysan oil field in southern Iraq and into the Kirkuk oil field in the north of the country. Shell has also got its sights set on the Rumaila oil field in the south, close to the Kuwaiti border.

As far as natural gas is concerned, Shell is pursuing an ambitious plan to become the leading company in the field of the production and sale of Iraqi gas. This year, in the city of Muscat in Oman, Shell presented a so-called gas master plan to former Iraqi oil minister Issam al-Chalabi, his deputy Abdul Jabbar al-Wakkaa and other high-ranking bureaucrats from the Iraqi oil industry. A further meeting then followed in the Netherlands. Today, al-Chalabi is an advisor to Prime Minister Nouri al-Maliki.

Concrete steps to implement the gas master plan have already been taken. Together with Turkish enterprises, including Turkey’s state-run oil corporation, a pipeline is to be built taking Iraqi natural gas to the north and then via Turkish ports on to the European market. A meeting of Shell representatives with Turkish and American officials, together with the Turkish enterprises involved, has already taken place.

“We have done all our homework on Iraq,” according to Shell’s executive chairman Jeroen van der Veer in September of last year. “I’m not going to speculate on the time, but we are ready to move.”