African American churches in New Jersey are becoming more accepting and aware of gay and lesbian parishioners, a sampling of black ministers in Newark by the Star Ledger finds. The Rev. Ronald Slaughter of St. James AME in Newark estimates “60 to 70 percent of all churches have homosexuals in their congregations.” “I think anyone who is gay or lesbian or whatever should be welcome in all of our churches. That shouldn’t be a question,” the Rev. M. William Howard of Bethany Baptist in Newark, told the Ledger.
Republicans in the House and Senate are pushing hard for two polluter poison-pill provisions in the payroll tax cut extension bill. Guaranteeing a year-end flood of contributions from the fossil fuel industry, the GOP has attached language to override the Obama administration’s actions on the Keystone XL tar sands pipeline and air-pollution rules for industrial boilers, known as the Boiler MACT rules. In a striking but incomplete victory for the climate movement, the Obama administration has extended the review of the Keystone XL pipeline until 2013. Fighting intense polluter lobbyist pressure, EPA has announced watered-down Boiler MACT rules that exempt 99 percent of industrial boilers from having stricter limits on mercury, dioxin, particulate matter, hydrogen chloride, and carbon monoxide.
On Fox News Sunday, Senate Minority Leader Mitch McConnell (R-KY) admitted the Keystone XL and Boiler MACT poison pills threaten the passage of the payroll bill. He told Wallace that the payroll tax cut extension “obviously” will pass, but claimed Republicans have added these pollution poison pills on a “bipartisan basis“:
But we also need to have something in there that prevents the loss of jobs and something that will create the jobs. And that’s why we inserted Boiler MACT, supported on a bipartisan basis and the Keystone pipeline supported on a bipartisan basis. One would save jobs, one would create jobs right now.
McConnell is technically not lying about the bipartisan support, as there are a handful of Democrats who have cast their lot in with polluter interests instead of people’s health like the Republicans on both issues. However, neither the Keystone nor Boiler MACT poison pills would save or create jobs — studies have found that the economic and societal impact of their increased pollution would far outweigh any short-term benefits of allowing polluters to keep dumping waste into the atmosphere and water without consequence.
President Obama has said unequivocally that he will “reject” any attempt to include the Keystone language in the payroll bill, but has not issued a similar veto threat on Boiler MACT.
However, for the first time the negotiators explicitly and formally recognized the cold fact of the insufficiency of the United Nations Framework Convention on Climate Change (UNFCCC) agreements, coming into their 20th year:
Recognizing that climate change represents an urgent and potentially irreversible threat to human societies and the planet and thus requires to be urgently addressed by all Parties, and acknowledging that the global nature of climate change calls for the widest possible cooperation by all countries and their participation in an effective and appropriate international response, with a view to accelerating the reduction of global greenhouse gas emissions,
Noting with grave concern the significant gap between the aggregate effect of Parties’ mitigation pledges in terms of global annual emissions of greenhouse gases by 2020 and aggregate emission pathways consistent with having a likely chance of holding the increase in global average temperature below 2 °C or 1.5 °C above pre-industrial levels.
This formal admission that the combined effect of Kyoto Protocol and the Cancun Agreements leaves a “significant gap” from the “urgent and potentially irreversible threat” of further warming is a critical admission. This marks a dramatic shift from earlier statements made by the United States team, who questioned the urgency of greater cuts to carbon pollution than already agreed in Kyoto and Cancun.
The 1997 Kyoto Protocol set mandatory limits on carbon pollution covering the industrialized world other than the United States, and the Cancun Accords adopted in 2010 sets voluntary limits covering the United States, China, and other major polluters. Together, their insufficient ambition leaves the world hurtling on a path towards unimaginable suffering, a terrible statement about the futility of negotiating with the laws of nature, and the stark contrast between political and physical reality.
The formal admission of this insufficiency is a small but crucial step towards the required global mobilization to survive on our changing planet.
Source: Platts Insight.
Renewable energy is entering a new phase heading into 2012 with winners and losers emerging.
Renewable energy over the past decade has enjoyed phenomenal success, with sectors like wind and solar power expanding installed capacity at rates of 30-50% each year. Wind turbine makers, solar panel manufacturers, biomass pellet producers and other supply-chain companies, along with project developers, have shared in the good times, with plenty of prosperity to go around.
Renewables have developed in major industrial countries such as Germany, Japan and the United States as part of larger energy mixes, a variable-output complement to base load power sources such as coal and natural gas. But heading into 2012, renewable energy is entering a new phase, with winners and losers emerging both within renewable energy sectors and as part of larger energy markets.
Renewables are no longer just one energy source among many; some have become direct competitors with fossil fuels. Renewable energy, bolstered by long-term government support policies in many countries, has weathered tough economic times and volatile debt markets since the financial crisis first hit in 2008.
Some mature markets, like those in the EU, continue to grow, fueled by policies requiring EU member states to secure a set amount of their energy from renewable resources by 2020. The targets differ from country to country, but the overall support is there. Even EU members with shaky economies like Greece, Ireland, Italy and Portugal will maintain their support for renewables. Indeed, Greek policy makers view renewable energy as an important source of jobs and economic development amid a slumping economy.
Along with steady growth in European renewable strongholds like Germany, new markets are also opening up in east Europe and Central Asia. Wind power capacity could expand 400-600 MW annually in countries like Poland, Romania and Turkey, according to HIS analyst Marc Muhlenbach. In contrast, the US renewables market has stalled, particularly the wind-power industry, and could spiral downward in 2012.
The key federal renewables policy—the Production Tax Credit, which provides an inflation-adjusted 1.9¢ tax credit for electricity generated from renewable sources—is set to expire at the end of 2012. With cost-cutting high on the agenda of many US federal lawmakers, the PTC might not be renewed, which could send the nation’s renewables development, particularly wind-farm construction, into a tailspin.
This would continue the boom and bust cycle that has plagued the US wind industry for years as Congress periodically allows the PTC to expire, only to renew it after US wind power development sputters and halts. “Six months ago, we wouldn’t have doubted it would be extended,” Boust said. “Now we’re not so sure.” Without a broad federal renewables policy, the industry relies on state renewable portfolio standards requiring electricity retailers to obtain a portion of their power from renewable energy. Yet as a September analysis by Standard & Poor’s notes, “many utilities in the western US have made rapid progress toward meeting their near-term RPS goals, and wind build-out is expected to slow down as a result … This dynamic, if combined with the potential expiration of the wind PTC at the end of 2012, may result in a sharp decline in wind project development,” according to the study, Regulatory And Political Headwinds May Slow Renewable Energy Growth.
Wind project activity and orders for 2013 and beyond “are scant because of the lack of a predictable business environment, causing layoffs and even bankruptcies in American manufacturing plants and the supply chain,” the American Wind Energy Association warned.
“These struggles for US wind manufacturers will only worsen if Congress were to allow the tax credit to expire.” As a result, the US wind energy industry, once the world leader, now ranks No.
2 in installed capacity behind China. Like other Asian countries, China has emerged as a key center for renewables generation capacity and technology manufacturing though warning signs are flashing for the booming Chinese market too.
The Solar PV Shakeout
Perhaps no renewables sector better illustrates the industry’s winners and losers than solar photovoltaics. On the one hand, plunging prices for PV equipment have made solar energy more affordable than ever for consumers—and more lucrative for developers, who can maintain attractive pricing for rooftop systems even as US states and EU countries cut their incentive programs. PV panel prices are dropping so quickly, the Standard & Poor’s analysis points out, “that the price of $1 per watt, recently predicted for 2015, now looks likely by the end of 2011.”
In Europe, the cost of generating electricity from PV has plummeted 50% over the past five years. In a variation of Moore’s Law for personal-computer price reductions, over the last 20 years, the price of PV modules has dropped 20% every time the cumulative sold volume of PV modules has doubled, the European Photovoltaic Industry Association notes. “Importantly, there is a huge potential for further generation cost decline: around 50% until 2020,” according to a 2011 EPIA study. “The cost of PV electricity generation in Europe could decrease from a range of 0.16-0.35 €/ kWh in 2010 to a range of 0.08-0.18 €/ kWh in 2020, depending on system size and irradiance level.”
As a result, the US and European markets continue to thrive. US grid-connected PV installations in second-quarter 2011 grew 69% over the same period in 2010, bringing the country’s installed solar capacity to more than 3.1 GW. In addition, new territories for PV are surfacing; the state of New Jersey’s commercial PV installations exceeded California’s for the first time in 2011.
“The US remains poised to install 1,750 MW of PV in 2011, double last year’s total, enough to power 350,000 homes,” according to the US Solar Energy Industries Association. Further expansion is likely through the largest PV initiative to date in America, set to be conducted by Solar- Strong, that would double the number of residential solar PV installations in the US
to 320,000 arrays.
On a global scale, the PV market has reached a cumulative installed capacity of 40 GW, with 16.6 GW of capacity added in 2010. And in sunny climates like the southern Mediterranean, PV power generation is rapidly approaching the long-sought grid parity at which it can compete with conventional power sources without government subsidies. Yet, at the same time, PV manufacturers like Solyndra, Evergreen Solar and Spectrawatt have gone bankrupt, while others like SolarWorld and Solon have shuttered their solar module factories. PV supply is far outpacing demand. Plummeting prices are the result not just of technological advance but of producer profit margins, creating the paradox noted by S&P that “the bankruptcies were caused by falling panel prices, which is actually positive for the future prospects of solar power.”
S&P cites China’s propping up of its large PV producers through cheap financing—even in the face of excess industry supply—as a key element in equipment price reductions. US Senator Ron Wyden has charged the Chinese government with illegally subsidizing its domestic PV industry in violation of international trade rules.
Renewables vs Conventional Fuels
The March catastrophe at Japan’s Fukushima nuclear complex triggered renewed opposition to nuclear power in Europe. Under a policy in Germany issued by the conservative coalition government in June, all nuclear power plants will be closed within ten years, and renewables’ share in the nation’s electricity supply is to double from the current 17% to 35% by 2020.
Though much of Germany’s power shortfall will be replaced by natural gas and coal in the short-term, offshore wind power is also set to benefit. Offshore wind farm operators will see their guaranteed above-market rate of €0.15/ kWh cut only from 2018, three years later than the government planned, and a so-called sprinter bonus for projects up and running by 2015 will remain in place beyond 2015.
Two other major industrial powers, Japan and Italy, are also turning away from nuclear power and slowly towards renewables in the wake of the Fukushima accident. Italian voters this year rejected an effort by the government to resume nuclear plant construction, while the Japanese government has pledged to make renewable energy a cornerstone of its post-Fukushima energy strategy. In the US, renewable energy is increasingly locked into direct competition with natural gas. Though on a technical side the two energy sources continue to be used in complementary fashion, with base load gas balancing out variable sources like wind and solar, the shale gas boom has forced down US gas prices.
Utilities that once viewed renewable energy supplies as a hedge against volatile gas prices have less incentive to buy power from wind farms or to finance solar PV installation. “There’s stiff competition from conventional sources” for renewables in US markets, Boust said.
New renewables markets are emerging in developing countries as governments in Bangladesh, the Philippines, South Africa, Thailand and the Pacific Islands set policies designed to cut their reliance on fossil fuels. In addition, a new type of renewable energy market is set to begin in Scandinavia next year: Norway and Sweden in January will launch the first cross-border system for trading green energy certificates.
At the same time, burgeoning renewables markets in Brazil and India are on course for further expansion. In Brazil, the renewables industry, which racked up sales for 2.7 GW of generation capacity as part of two federal power auctions in August, stands to make further gains with new electricity auctions in 2012. India, too, is committed through national programs to major renewables expansion. Its National Solar Mission initiative has established the target of bringing 22 GW of solar PV capacity on-line by 2022, though local content requirements have discouraged
the entry of some foreign producers.
The federal government has also established a similar program for biomass expansion, and wind energy currently amounts to about 13 GW of capacity, with further expansion planned. Combined with solar power and small hydropower programs created by the country’s powerful state governments, India appears primed to retain its position as a leader in clean-energy growth.
China in recent years has leapfrogged to the top ranks of renewable energy markets, surpassing the US in installed wind capacity that now exceeds 42 GW. IHS’ Muhlenbach said China remains the “powerhouse” of wind energy growth with “more mature markets approaching saturation.” However, the Chinese market, particularly for wind energy, could be headed for a slowdown.
Market analysts V/B Research reported in October that financing for Chinese wind projects had fallen 14% to $6.3 billion quarter-on-quarter based on fears of over-expansion. “The decline is a direct consequence of measures taken by China’s government to curb the country’s rapid expansion of wind capacity.
There are growing concerns regarding over-supply of turbines in the domestic market and the fact that large amounts of constructed wind capacity remains unconnected to the grid,” V/B Research said. “In response, the central govern-ment has imposed heavy cuts to wind installation targets and asserted control over approval of projects smaller than 50 MW, which had previously been the preserve of local authorities.”
And as markets change, both commercial and political perspectives on renewable energy continue to evolve. Such corporate giants as Siemens, GE and Martifer in the recent year have committed major resources to renewable energy as project developers and equipment producers.
More non-energy companies are entering the renewables field; German conglomerate BayWa is acquiring renewables companies to add to its broader corporate roster; while Google said in June it planned to create a $280 million fund in partnership with PV developer SolarCity to finance residential solar projects. In the political arena, commitments to renewables development are broadening from concerns about pollution and climate change to encompass energy security.
Cyprus, for example, accelerated its solar energy development this year following an accident that crippled the island nation’s main source of power, a plant at a naval base.
In Israel, demands are growing for expanding wind and biomass power as disruptions in gas supplies from neighboring Egypt have left the country scrambling to meet power-production requirements, while Bangladesh, with few energy resources save for the some of the world’s greatest solar radiation—plans to use PV to meet its goals for village electrification. In addition, concerns about the availability of rare earth metals are a source of major discussion in the wind industry, Muhlenbach said. Though not especially rare, many rare earths vital for producing wind turbines, solar panels and batteries are currently almost solely available from China, which has demonstrated its willingness to withhold rare earth deliveries to Japan in a dispute unrelated to the metals.
Changes in technology are taking hold. New types of wind turbines are being developed that are designed to take advantage of areas with low wind speeds compared with prime wind spots, Muhlenbach said. “They’re moving toward longer rotors and larger towers,” he said.
Continued growth in established renewables markets, along with openings in developing countries, show that clean-energy has yet to enter a period of cut-throat competition, either among renewables project developers or in battles for markets with other energy resources. There are still plenty of energy production contracts to support a broad market encompassing many types of resources, even with energy use stagnating or falling in most countries as the global economic slump drags on. However, the split between PV equipment producers and developers, as well as the clash between renewable resources and conventional fuel sources in securing shares of utilities’ energy mixes, indicate that the renewables industry could be undergoing fundamental change. Renewable energy, long considered a win win situation for utilities, developers and national economies, is increasingly becoming a zero-sum game.
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Next April, FORTUNE will again bring together some of the smartest people we know in sustainability for Brainstorm Green, the magazine’s annual conference on business and the environment.
This is will be our 5th Brainstorm Green–hard for me to believe, since I’ve been involved since the beginning–and we’ve again got a first-rate lineup of leaders from corporate America, the environmental movement, the investment community and government, as well as a scattering of interesting writers, thinkers and doers about “green.”
Once again, the event will be held at the spectacular Ritz Carlton in Laguna Niguel, CA. Dates are April 16-18, 2012.
New faces for 2012 from the corporate world will include Alan Mulally, the president and CEO of Ford; Rob Walton, the chairman of Walmart; Andy Taylor, the chairman and CEO of Enteprise (they buy more cars than anyone in America); C. Larry Pope, the chairman and CEO of Smithfield Foods (they make more hot dogs than anyone in America, as I wrote in Smithfield Foods: Sustainable Pork?); Vance Bell, the chairman and CEO of Shaw Industries (the world’s largest carpet manufacturer, see my blogpost, This carpet has moral fiber); John Faraci, the chairman and CEO of International Paper; Gary Hirshberg, the CE-Yo of Stonyfield Farm; Russ Ford, the executive vice president of Shell; Bea Perez, the chief sustainability officer of Coca-Cola; and Trae Vassallo of Kleiner Perkins.
Other newcomers will include former EPA chiefs William K. Reilly and Christine Todd Whitman; he’s now with private equity firm TPG, and chaired the BP oil spill commission, she’s an energy and environmental consultant and nuclear-power advocate. We’ll talk politics and climate with John Podesta, the chair of the Center for American Progress and former chief of staff to President Clinton. John Warner — the Ph.D. chemist, not the former U.S. Senator — will explain the promise of green chemistry. Bonnie Nixon will deliver insight into The Sustainability Consortium. And I certainly hope that Jared Diamond, the Pulitzer Prize winning author and geographer, will counsel us on how to avoid Collapse.
Although we meet just once a year, I like to think of Brainstorm Green as a community, albeit an ephemeral one. That’s largely because many of those who came for the first Brainstorm Green, back in 2008, have come back again and again. In particular, we are joined every year by the leaders of our programming partners–the Environmental Defense Fund, the Natural Resources Defense Council, The Nature Conservancy and Conservation International. EDF’s Fred Krupp, NRDC’s Frances Beinecke, TNC’s Mark Tercek and Glenn Prickett and CI’s Peter Seligmann will all be back in 2012.
Many other Brainstorm Green “alums” will return, too. In no particularly order: David Crane, the CEO of NRG Energy; Fisk Johnson, the chairman and CEO of S.C. Johnson; Jim Rogers, CEO of Duke Energy; Mike Brune, executive director of the Sierra Club; Scott Griffith, the chairman and CEO of Zipcar; David Neeleman, the founder and CEO of Brazil’s Azul airline; Ted Roosevelt IV of Barclay’s; Dara O’Rourke of Good Guide; and water expert Will Sarni of Deloitte.
[I'm also hoping that the incomparable Chuck Leavell -- keyboardist with the Rolling Stones, award-winning tree farmer and all-around good guy -- will return in 2012. My FORTUNE colleague Brian Dumaine, who is co-chair with me of Brainstorm Green, also functions as our musical impresario, and he tells me he's doing his best to persuade Chuck to come back.]
As always, there will be plenty to talk about–the shale gas boom, the future of renewable energy, the continuing “greening” of corporate America, the 2012 election, consumer behavior around green, corporate water strategies, electric cars, etc. The theme of the conference is, how can business help profitably solve the world’s big environmental problems?
The program remains in flux, so if you want to propose a speaker or call our attention to a new topic, please do so here at the Brainstorm Green website. You can also request a delegate invitation on the registration page. I hope to see many of you in Laguna Niguel in April.