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February, 2010:

2010 Budget Speech Excerpts

a world of green

Promoting Green Economy

89. In my last Budget, I proposed to promote a “green economy” and introduced a series of measures, including Hong Kong-Guangdong co-operation in environmental protection, the use of electric vehicles and promotion of green buildings. In his Policy Address, the Chief Executive further announced the development of environmental industries as one of the six industries and put forth initiatives in respect of the Cleaner Production Partnership Programme, the Clean Development Mechanism Projects, and Government Green Procurement. These initiatives have already been rolled out. In the next financial year, I will give further support in the following areas.

Pilot Green Transport Fund

91. To encourage the transport sector to test out green and low-carbon transport technology, I propose to set up a $300 million Pilot Green Transport Fund for application by the industry, initially by the public transport operators. I hope that this Fund will encourage the industry to introduce more innovative green technologies, such as the use of buses, public light buses, taxis, and ferries that employ green technologies, and help nurture the budding of green technology in Hong Kong.

92. The use of low-emission and energy saving transport will not only help improve roadside air quality, but also reduce carbon emissions and promote a low-carbon economy. I hope that the transport industry will actively try out innovative green technologies, contributing to better air quality and the health of people living in Hong Kong.

Phasing Out Old Diesel Commercial Vehicles

93. In 2007, the Government launched a scheme to subsidise the replacement of the more polluting pre-Euro and Euro I diesel commercial vehicles with newer models producing fewer emissions. The scheme will end this March. To continue to accelerate the phasing out of old diesel commercial vehicles, I will provide a 36-month subsidy scheme for the replacement of Euro II diesel commercial vehicles. The scheme will involve expenditure of about $540 million.

94. I also propose to accelerate the tax deduction for capital expenditure on environment-friendly vehicles. Enterprises can enjoy a 100 per cent profits tax deduction in the first year under the proposal. This will encourage the business sector to purchase more electric vehicles, hybrid vehicles and other environment-friendly commercial vehicles.

95. To promote the use of electric vehicles, I set up the Steering Committee on the Promotion of Electric Vehicles last April. The Committee has made a number of recommendations on the strategy and concrete measures for promoting electric vehicles. One of the recommendations is that the Government should take the lead in using more electric vehicles. We have procured 10 electric vehicles, and plan to purchase 10 to 20 such vehicles in each of the following few years. Besides, 10 electric motorcycles have been introduced into the Police fleet. In the private sector, the two power companies have placed orders for over 20 electric vehicles. Furthermore, around 200 electric vehicles will be supplied to the local market in the next financial year. We expect to see wider use of electric vehicles in Hong Kong in the year ahead.

96. We have made good progress in increasing charging facilities for electric vehicles. We have built charging stations in nine government car parks and will build more than 20 such stations this year. Apart from these, the two power companies have started building 28 charging stations in various car parks. The Electrical and Mechanical Services Department has also issued guidelines on the installation of charging facilities in car parks to encourage operators of private car parks to provide such facilities. The Government and the power companies will continue to expand the charging networks for electric vehicles.

What do you think about the government’s proposals? Sound off after the jump.

Clean burning bio-diesel source under our noses

SCMP, Eric Ng, 2010-2-20

Every day hundreds of tonnes of waste cooking oil, grease and animal fat are discarded by Hong Kong’s 20,000-plus restaurants. The real waste is that it could be used as clean fuel in the city’s vehicles.

Some of the oil and fat is illegally smuggled to the mainland to be recycled as cooking oil, consumption of which is known to raise the risk of heart disease and cancer. But most of the material ends up in landfills.

Waste oil and fat can be processed into bio-diesel, a fuel that is cleaner burning than fossil fuel diesel, with no sulphur and much lower carbon gases and particulate emissions.

In Europe and the United States, government support has resulted in a vibrant bio-diesel industry, with most of the feedstock coming from plant oil, waste cooking oil and animal fat. But Hong Kong’s government is dragging its feet on similar measures, despite the fact bio-diesel could help improve the city’s dire air quality.

Germany requires diesel sold in the country to contain at least 4.4 per cent bio-diesel. In Spain, the ratio is 3.9 per cent and 7 per cent in France.

Other than a duty-free policy on bio-diesel and a new law passed last month stipulating the quality of bio-diesel, the Hong Kong government has yet to push through more aggressive policies to spur bio-diesel consumption.

The legislation, to take effect on July 1, requires bio-diesel sold on the market to comply with European EN 14214 standards. The statute aims to shore up consumer confidence and clamp down on illicit product.

But critics say more needs to be done by the government. One key measure needed is the mandatory blending of bio-diesel with fossil fuel diesel, something that has already been adopted in Malaysia, the Philippines, Taiwan and Thailand. The government also needs to mandate the use of bio-diesel in its own fleet of vehicles.

Despite the lack of local government support, the allure of future profits has attracted investors to the nascent industry. Several bio-diesel plants have already been built.

The biggest drawcard is Hong Kong’s hefty tax on fossil fuel, a hands-off policy on fuel pricing and the duty exemption on bio-diesel. That leaves plenty of profit margin for the clean fuel’s producers, provided they can get sufficient feedstock and open up sales channels.

In many developing nations, government fuel price controls leave less room for profits from bio-diesel.

Sha Tin-based Dynamic Progress International was the first company in Hong Kong to set up a bio-diesel plant two years ago. The company, 51 per cent-owned by listed electronics products maker Alltronics Holdings, started operating its plant in the government-built waste recycling EcoPark in Tuen Mun in September 2007.

Alltronics chairman Lam Yin-kee said that the plant had the capacity to produce around 16,500 tonnes of bio-diesel a year, a fraction of the around 4.5 million tonnes of diesel fuel consumed in Hong Kong annually.

The company in 2008 counted Kwai Fong’s Metro Plaza shopping mall and New Town Plaza in Sha Tin among its first sources of waste cooking oil, and supplies bio-diesel to two construction firms.

Dynamic executive director Steve Choi declined to provide updates on the plant’s utilisation and sales figures, or its sources of material and clients. He said he did not want his rivals to know about his business secrets, but added that the government can do more to promote bio-diesel usage.

According to Alltronics’ financial statements, the bio-diesel plant’s sales amounted to HK$207,000 in 2008. In last year’s first-half, it recorded sales of HK$1.08 million and an operating loss of HK$5.41 million.

Choi said instead of going through the time-consuming legislation process, it would be more efficient for the government to use other methods to promote the industry. That could include giving fuel distributors that blend bio-diesel into their fossil fuel diesel higher priority in winning tenders to operate fuel stations.

“The government doesn’t need to do a lot, just administrative measures can do the trick … we don’t need legislation,” he said. “We have already waited six years for the bill on  <147,1,0>bio-diesel quality specification to go through the Legislative Council … how many decades are there in one’s lifetime?”

A spokeswoman for the Environmental Protection Bureau said blending more than 5 per cent of bio-diesel into fossil fuel diesel could result in “incompatibility problems” in car engine components.

“That is why we need time to develop a well balanced regulatory framework involving consultation with relevant stakeholders including bio-diesel suppliers, oil companies, vehicle suppliers and the transport trades as well as the environmental affairs panel of the Legislative Council,” she said.

The government was exploring ways to promote the use of bio-diesel in Hong Kong, she said, with the first step being to promote diesel containing up to 5 per cent bio-diesel in the government vehicle fleet.

“The EPD is consulting various departments on the compatibility of their fleet and plants/machines with [such diesel],” she added.

Andrew Kwan Ming-tak, chief executive of Champway Technology – Dynamic’s rival in the EcoPark – said the government’s classification of bio-diesel as a dangerous good had hampered its sales in the mass consumer market.

This means it can only be distributed in places that meet fire safety standards such as petrol stations, which require investment of over HK$100 million each to build.

Given Hong Kong’s vehicle fuel market is dominated by four big oil companies, and there is a lack of mandatory bio-diesel blending, there is little incentive for people to buy bio-diesel.

“While sales to large transportation companies with big fleets of vehicles are possible, since they buy diesel in bulk over long term contracts at hefty discounts from oil firms, it is difficult for small bio-diesel producers like us to compete on price,” Kwan said.

Champway hopes to obtain all of the more than 10 government licences and permits needed to start up its bio-diesel plant next month, with a goal to break even in three years. The project is partly backed by Goldsland Holdings, a unit of state-owned Guangdong Foreign Trade Group.

Champway plans to build a 29,200 tonne-a-year plant with an investment of over HK$50 million. Capacity can be expanded to 109,500 tonnes with an additional investment of around HK$100 million, Kwan added.

However, it expects to be able to collect only 20 to 30 tonnes of waste oil a day in the short term, around a third of the plant’s initial capacity. It faces keen competition from existing waste oil collectors, which offer to pay restaurants for their oil. Some of this oil is believed to be sold illegally to the mainland to be re-used in cooking.

Kwan suggested that the government designates waste cooking oil as specialised waste that needs to be collected or dumped by licensed operators, in order to eradicate illegal smuggling of waste cooking oil to the mainland. He also said the government could consider allowing restaurants to get reductions on their wastewater discharge fees, if they properly disposed of a certain amount of waste oil properly.

Both Dynamic and Champway will face competition from ASB Biodiesel (Hong Kong), majority owned by the Middle East’s Al Salam Bank-Bahrain and six strategic partners.

ASB expects to complete a 100,000 tonne-a-year bio-diesel plant in an 18,000 square metre site in Tseung Kwan O Industrial Estate this year.

The project’s other shareholder is Hednesford, a Hong Kong company headed by Sjouke Postma, a Dutchman who has lived in Hong Kong for over 20 years and has worked on the project’s development for over a decade.

With an investment of US$100 million, the plant will use technology from Austria, which enables it to use multiple feedstocks, including waste cooking oil, grease trap waste, animal fat and palm fatty acid distillate.

Grease traps are plumbing devices that catch grease before kitchen waste water enters municipal sewage systems.

ASB chief executive Tom Uiterwaal said the plant’s output would be sold to both the European and Hong Kong markets.

The proportion of sales in the domestic market will depend on how soon the government implements a mandatory minimum bio-diesel blending policy, he said.

“In Hong Kong, a lot of roadside pollution comes from heavy commercial vehicles which can’t be solved by introducing electric cars. Bio-diesel is a solution to help solve Hong Kong’s air pollution problem.”

In Europe, bio-diesel consumption took off about five years ago due to the blending requirement. Consumption is projected to grow 14.3 per cent this year to 12 million tonnes.

More Reflective Roofs and Pavements Could Help Offset Climate Emissions

Washington, DC, February 19, 2010

Increasing the reflectivity or “albedo” of roofs and pavements in urban areas could offset greenhouse gas emissions by a significant amount, according to a paper published last month in Environmental Research Letters. The research performed by scientists at Lawrence Berkeley National Laboratory and NASA’s Goddard Space Flight Center shows that a 25% and 15% increase in the albedos of roofs and pavements, respectively, in urban areas, could lead to an offset of approximately 57 billion tonnes of carbon dioxide.

“Increasing urban albedo is something that should be done now to buy time for implementing other near-term and long-term climate mitigation strategies,” said Durwood Zaelke, President of the Institute for Governance & Sustainable Development.

Surfaces with high albedo reflect more solar radiation, preventing the radiation from heating the surface and the atmosphere. Introducing “cool roofs” and more reflective paving materials could replace some of the albedo that has been lost through the melting of Arctic sea ice.

“Although it does not solve the root of the climate change problem – substantial reductions in CO2 and other climate forcers are essential for that – urban albedo can delay the onset of more severe climate impacts, and reduce the risk of passing the thresholds for abrupt and irreversible climate changes,” added Zaelke.

Because CO2 emissions can remain in the atmosphere for up to 1,000 years, there is an urgent need for complementary, fast mitigation measures that will result in significant near-term reductions to avoid passing the tipping points for abrupt climate change, which may only be decades away. In addition to increasing urban albedo, such strategies include reducing emissions of black carbon soot, methane, and tropospheric ozone, as well as using the Montreal Protocol ozone treaty to phase down hydrofluorocarbons, which could prevent the emissions of more than 100 billion tonnes of CO2-eq. by 2050. Carbon-negative measures such as better forest management and production of biochar will also be necessary to bring atmospheric concentrations of CO2 back down to safe levels.

For more information, see:

Radiative forcing and temperature response to changes in urban albedos and associated CO2 offsets by Surabi Menon, Hashem Akbari, Sarith Mahanama, Igor Sednev and Ronnen Levinson (Environmental Research Letters, Jan 2010).

Solar Cells from Tobacco Plants May Be a Reality Soon

February 8th, 2010

As the world continues its quest to use less fossil fuels, the latest possible solution comes from the most unlikely of sources: the tobacco plant. This latest news comes from the University of California, Berkley. It will be nice to see tobacco used for something other than lung cancer. This new discovery is based on the possibility of literally programming the cells of the plants to get solar cells from tobacco plants. The science behind it is actually pretty simple (at least in explanation form) and pretty amazing. By using a genetically engineered virus, scientists were able to literally transform the cells of the plants to create synthetic solar cells.

Instead of creating some new form of tobacco plant, they are actually applying their chemistry to full grown tobacco plants. Their custom-made virus is sprayed on the plants and then it is time to sit back and let it work its magic. The virus infects a cell which then enables the virus to spread just as any other virus would. As the infected cells form, they are creating artificial chromophores that make high powered electrons out of light.

Of course, the plants themselves are not used for direct solar energy as they still have to be harvested. Once harvested, the structures are extracted and put into a liquid solution to dissolve. This solution is then applied to plastics or glass and poof, solar cells from tobacco plants is a reality. While the whole process may seem a little off the wall, if this process can be refined and work in mass form, it totally changes solar energy as we know it.

While this technology is exciting, the effect that it could have on an economy that seems to continue to go backwards is even more incredible. One of the hardest hit industries during the last decade has been the farming industry. Farmers have been struggling with their crops and tight times have not made things easier. An influx into the tobacco industry to create solar cells from tobacco plants could be a nice boost in the arm as farmers who are waiting for the bank to come and take their land will now have a viable way out.

These cells would not be expected to last as long as “typical” solar cells, but they would probably be much less expensive. That being the case, solar cells from tobacco leaves could provide both an organic way to produce solar cells and the economic boost that the farming industry needs.

Greens laud Lamma wind farm plan as breath of fresh air

The single turbine wind plant on the Lamma Island since 2006.

The single turbine wind plant on the Lamma Island since 2006.

Hongkong Electric will today announce plans to develop an offshore wind farm close to Lamma Island and will forward an environmental impact assessment for public inspection.

The site chosen for the project is southwest of the island.

Last year, the government gave CLP Power the go-ahead for an offshore wind farm, which may become the largest in Asia. The CLP project, off the Ninepin Islands near Sai Kung, may produce about 1 percent of the territory’s electricity.

Greenpeace senior campaigner Gloria Chang Wan-ki said she is looking forward to receiving details of the Hongkong Electric project. “Greenpeace thinks renewable energy is definitely one way for us to reduce our dependence on fossil fuel and to reduce our carbon footprint. It is a good way to go in combating climate change,” Chang said.

She said it is “a good initiative” for both power companies to plan for wind farms.

However, the government still has not gone far enough to support renewable energy.

“On one hand we have a 1-2 percent renewable target by 2012, a voluntary target which is not legally binding to power companies,” she said.

On the other, electricity pricing also puts fossil fuel costs “unreasonably low,” making the market unfavorable to renewable energy.

She does not think Lamma residents will oppose the wind farm because Hongkong Electric has had a single turbine wind plant on the island since 2006.

“Based on the feedback from the single wind turbine on Lamma, residents there, I think, will welcome another project in their own backyard.”

But Chang said although her group supports wind energy in principle, “we need to take a careful look at the details and the environmental impact assessment.”

She added: “This project is much bigger than a single turbine, so we need to look at other environmental impacts, for example, that on the seabed, scenery and noise.”

Source: HK Standard