Liquid fossil fuels and climate change

petrol pump

How much does our ETS increase petrol & power prices?

The following passage is from our government’s web page explaining the ETS. It’s only a short piece, but there are numerous examples of non-sequiturs, or illogical derivations from the previous statement.

Anyone convinced it’s based on science or logic? Anyone at all?

The government reasons*

Most forms of travel are fuelled by liquid fossil fuels, such as petrol and diesel, which result in emissions of greenhouse gases into the atmosphere.

New Zealanders travel frequently and have a high level of vehicle ownership. Our use of freight transport has increased as the economy has grown, and our geographical isolation makes us reliant on ships and planes to connect us and our products to the rest of the world.

Between 1990 and 2006, total transport emissions increased by 5.6 million tonnes of carbon dioxide, or 64 per cent. If we do not make changes to the ways we travel and transport freight, or to the technology and fuels we use, transport energy use will grow further. Public transport, biofuels, electric vehicles, rail, cycling and walking, as well as improved vehicle efficiency will all help – as will the ETS.

*Of course, this is among the worst of oxymorons.

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Andy
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Andy

Has anyone done a study on the power generation requirements for moving to a fleet of electric cars in NZ?

I believe that similar studies in the UK have show power for electric cars to be predominantly derived from coal power stations.

Similarly, I think there are studies that show biofuels actually emit more net CO2 than fossil fuels.

Other than the walking and cycling bit, I don’t think we can take any of the governments pronouncements as true without further investigation.

Richard Treadgold
Guest

There is at least this one, published here at the CCG. Makes interesting reading, Gary would still be pleased, I’m sure, to hear of any criticisms of it if you find some. Suggests there would be big problems with maintaining service if electric cars grew popular very quickly.

Gary
Guest
Gary

I dont mind sensible Green inititives,that make ecconomic sense, that don’t affect the well being of people.
However as we know those that use this CO2 con are noted for their ability to stretch the truth on facts, and as we know an ETS will do nothing for the enviroment.
We got it thanks to a bunch of Spinless MPs not prepared to tell the world to take a hike.

Richard C (NZ)
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Richard C (NZ)

NZ ETS Fuel Levy thread header here:- https://www.climateconversation.org.nz/open-threads/politics/ets-and-carbon-taxes-001/#comment-27588 From the AA article:- The Rising Costs of Driving The ETS requires fuel providers to have a permit to release a greenhouse gas or use energy. Luckily individual motorists don’t need a permit – called a unit, which represents a tonne of carbon dioxide – but oil companies need to buy enough units to cover the amount of fuel they sell to motorists Units are purchased from the market-place [Secondary market €12.40 per unit], an exchange where units allocated by the Government to foresters or firms are traded. Firms can also import units from United Nations validated carbon unit suppliers [Primary market €4 per unit]. Most of the oil companies are already involved in these international markets. From July 2010, the oil companies will need an estimated 15 million units per year. At present, however, only 8% of eligible New Zealand forests have entered the scheme, meaning just 7.3 million units are available. Fortunately, the Government has offered those companies requiring units a two-for-one deal – until 2013, the oil companies will only need half the number of units they would normally need – about… Read more »

Richard C (NZ)
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Richard C (NZ)

Daft I think for retailers to pay NZ$25 cash to the govt when they could (should and probably are) purchase on the primary market at NZ$7 a unit..

That’s using a €4 2010 price and current 0.56625 x-rate from here:-

http://www.x-rates.com/d/NZD/table.html

Even buying on the secondary market at €12.40 works out at NZ$21.90 using 2010 prices (€11.80 in 2009, €17.80 in 2008).

Richard C (NZ)
Guest
Richard C (NZ)

CER price variation is explained in “State of the Forest Carbon Markets 2011” this way:-

“Prices continue to vary widely across the regulated and voluntary markets, as each market
transacts very different credits with unique supply- and demand-side drivers to go along with distinct project-level characteristics.”

http://www.forest-trends.org/documents/files/doc_2975.pdf

Whew, these things are hard to get a handle on.but there’s more explanation copied from the same report at this comment:-

https://www.climateconversation.org.nz/2011/10/liquid-fossil-fuels-and-climate-change/#comment-68172

See “The Value of a Standard” and Figure 4: Price Distribution by Carbon Accounting Standard Applied in 2009 and 2010

Richard C (NZ)
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Richard C (NZ)

Andy asked in the UN thread:- It appears that we, the public, pay an amount X for our indulgences. Emitters can opt to pay Y for offshore CER certificates, where Y <= X. We pay about 3c a litre ETS tax but the emitter is the petrol retailer in terms of the Climate Change (Liquid Fossil Fuels) Regulations and at present they are paying NZ$25 cash a tonne to the govt so that X = Y (see below). If they were to purchase CERs off-shore they would pay €4 per unit on the primary market or €12.40 per unit on the secondary market. The question is, where does the difference, X – Y, go to? There’s no difference at the moment because petrol retailers are not purchasing off-shore to satisfy ETS Regs so the 3c is derived from the $25 cash they are paying (see Emissions factors up-thread). I suspect that when they do purchase off-shore in 2013 that each retailer will adjust the ETS levy charged to motorists to reflect their respective average unit cost i.e. X = Y still. The same could be said for Y, too. In 2013 Y will… Read more »

Richard C (NZ)
Guest
Richard C (NZ)

From ETS REVIEW 2011:-

17 May 2011 Panel Meeting Panel Paper: Panel’s comments on other issues

Liquid fossil fuels in shipping – operation of international shipping
4. The key here is the differing treatment of domestic v international shipping. The Panel is interested in the Secretariat’s view on section 202 and how this may be used to alleviate the concern. Below is an extract from submission 41, Pacifica Transport.

http://www.climatechange.govt.nz/emissions-trading-scheme/ets-review-2011/supporting-info/other-issues-additional.pdf

Pacifica Shipping have published their ETS Levy:-

At the comment date linked below, the ETS Levy added by Pacifica is $6 per TEU (Twenty-foot Equivalent Unit), based on the $25 New Zealand unit price. See details here:-

https://www.climateconversation.org.nz/open-threads/politics/ets-and-carbon-taxes-001/#comment-27594

Richard C (NZ)
Guest
Richard C (NZ)

ETS Case Studies

Example 1 – Sheep and Beef

Example 2 – Dairy

Example 3 – Arable

Example 4 – Dairy, Sheep and Beef

At present milk and meat processors will pay this on behalf of the farmer. At $25/NZU this will amount to a levy of about 3c/kg beef, 6c per kg sheepmeat and 2.5c/kg milk solids.

http://www.carbonfarming.org.nz/ets-case-studies.html

Richard C (NZ)
Guest
Richard C (NZ)

Contact Energy ETS pricing:-

The price increases will apply to the variable part of your bill – which reflects the actual amount of electricity and/or gas you use. Electricity prices will increase by 0.77 cents per kilowatt hour and gas prices will increase by 0.27 cents per kilowatt hour. These increases exclude GST and are prior to the application of your prompt payment discount.

For an average residential customer using 8,000 kilowatt hours of electricity per year and 8,000 kilowatt hours of natural gas per year, this would mean an increase of $5.31 for electricity (3.2%) and $1.86 (2.2%) for gas per month (including GST and after a 10% prompt payment discount).

http://www.contactenergy.co.nz/web/findoutabout/ets?vert=fh

Mike Jowsey
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Mike Jowsey

If we do not make changes to the ways we travel and transport freight, or to the technology and fuels we use, transport energy use will grow further. Public transport, biofuels, electric vehicles, rail, cycling and walking, as well as improved vehicle efficiency will all help – as will the ETS.

How exactly does the ETS help us change how we freight goods from or to overseas? How does it help make changes to the technology and fuels we use? Answer – it does not help one iota. In fact, it does not even help us choose the rail over our family car. It is simply a tax on the masses. It will change nothing except the coffers of our fearless government, or some faceless bureaucrats in some far-off country.

Clarence
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Clarence

“New Zealanders travel frequently …. make changes to the way we travel.”

I’ve read this 3 times, and it seems to me the only real meaning is that we have to travel less frequently. The ETS can achieve this by putting travel costs beyond the means of the poorest New Zealanders.

The demand for transport is notoriously inelastic. Usage reduces only slightly when prices of fuel go up, but the extra money siphoned off to the Government makes less available for other necessities, like food, medicines, babywear, etc

A large share of total travel is getting to and from work. As costs increase, the unemployment benefit looks ever more attractive.

Richard C (NZ)
Guest
Richard C (NZ)

I’ve recently been interviewed in a govt survey of New Zealanders travel and NZ tourism in general.

Some of the questions seemed very much ETS specific with domestic travel and getting to and from work being asked about.

Mike Jowsey
Guest
Mike Jowsey

Clarence, you say: The ETS can achieve this by putting travel costs beyond the means of the poorest New Zealanders. I think you will find that when demand for travel drops, so does pricing (often sponsored by a country seeking tourism dollars). Alternatively, if I have to pay an extra $200 for ETS costs on an overseas trip costing $5000 overall, am I going to suddenly reconsider my travel plans and buy a sail boat? Ah, no…, just whack it on the credit card. My point is, the ETS will not substantially change the lifestyles of New Zealanders. It simply increases the costs to the consumer and makes for an unhappy constituency. It does not decrease profits to the airlines, energy companies or industry. They simply pass the increased costs on to the consumer. It does, however, decrease profits for farmers because they have no control over the prices at which they sell their produce. Yet, even here it will not change pastoral farming practices (unless the farmer astutely decides to convert from pastoral farming to forestry) because currently there is no technological answer to methane emissions from livestock. So, in summary, the… Read more »

Andy
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Andy

Yes, but that is the point of the whole thing.Carbon trading is a wealth transfer from “rich” countries such as NZ to “developing” nations such as China.

If you look at Australia’s emissions projections, you will see that 50% of their “reductions” at least will be credits purchased from offshore.

Richard C (NZ)
Guest
Richard C (NZ)

State of the Forest Carbon Markets 2011 http://www.forest-trends.org/documents/files/doc_2975.pdf Table 1. Volume, Value, and Prices in the Forest Carbon Markets 0.0 MtCO2e transacted in the NZ ETS 2010. Total global voluntary 2010: 27.6 MtCO2e Total global regulated 2010: 2.6 MtCO2e Total Global Primary Market 2010: 29.0 MtCO2e Total Global Secondary Market 2010: 1.2 MtCO2e The Global Flow of Credits Latin America provided the lion’s share of supply, contributing more than half of the volume contracted in 2010 (see Figure 2), almost entirely from 28 projects in Peru and Brazil. European buyers stepped in as the largest source of demand, taking at least 10.6 MtCO2e primarily from Latin America, Asia, and Africa North America provided the second-largest sources of both supply and demand in the market, with companies taking on 5.6 MtCO2e, just over the 4.9 MtCO2e supplied from projects in the region. North American buyers were the primary source of demand for credits from North American projects, but Europeans were also willing to take a substantial slice of the North American pie (0.5 MtCO2e). The Changing Face of Projects The private sector has emerged as a new torchbearer for forest carbon projects. Taking cues… Read more »

Richard C (NZ)
Guest
Richard C (NZ)

EU Carbon Trading Rocked By Mass Killings

Monday, 03 October 2011 09:19 Arthur Neslen, EurActiv

The reported killing of 23 Honduran farmers in a dispute with the owners of UN-accredited palm oil plantations in Honduras is forcing the Clean Development Mechanism (CDM) executive board to reconsider its stakeholder consultation processes.

http://www.thegwpf.org/international-news/4009-eu-carbon-trading-rocked-by-mass-killings.html

EU carbon trading scheme pays for murder of 23 farmers in Honduras

http://motls.blogspot.com/2011/10/eu-carbon-trading-scheme-pays-for.html

Murdering Peasant Farmers For Fun And AGW Profit

http://cbullitt.wordpress.com/2011/10/03/murdering-peasant-farmers-for-fun-and-agw-profit/

Richard C (NZ)
Guest
Richard C (NZ)

Honduras: Human Rights Violations in Bajo Aguán International Fact Finding Mission Report A recent example of a significant international loan is project 27250 by the International Financial Corporation (IFC), an entity of the World Bank Group that co-finances the project, providing 30 million USD of the sum total of 75 million USD to the Dinant Corporation, owned by businessman Miguel Facussé. 30 However, on the 11 April 2011, the German Investment and Development Society (DEG) decided to suspend their contractual relationship with the Dinant Corporation and not grant the agreed upon loan. DEG received the preliminary report and began a dialogue with the international fact finding mission. After analysing the situation, the public bank that manages German development funds, decided to withdraw their final support from the project. Furthermore, the Clean Development Mechanism´s Executive Board (CDM) and the British government are reviewing their authorisation of controversial carbon offsetting project in the Bajo Aguán: Due to the reported human rights situation, EDF Trading, a wholly-owned subsidiary of Electricité de France SA and one of the biggest CDM investors, pulled out of a contract to buy carbon credits of around 2.8 million dollar from the… Read more »

Peter Muncaster
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Peter Muncaster

Sadly most well meaning Kiwis are blissfully unaware of this comedy of errors. The NZ carbon Exchange have said that there is a potential market of 140,000,000 tonne at say $20/tonne = $280,000,000,000 per year buying & selling. The big forestry companies are said to be buying beef and sheep farms. The consequence of that means that NZ will no longer be 100% pureNZ but rather 100%pineNZ. owned by whoever owns the pine trees!

Peter M

Richard C (NZ)
Guest
Richard C (NZ)

Too many zeros Peter. 140,000,000 tonne at say $20/tonne = $2,800,000,000 per year buying & selling.

Actual 2010 market is up-thread here:-

https://www.climateconversation.org.nz/2011/10/liquid-fossil-fuels-and-climate-change/#comment-68172

Forest Carbon Markets

0.0 MtCO2e transacted in the NZ ETS 2010.

Total global voluntary 2010: 27.6 MtCO2e

Total global regulated 2010: 2.6 MtCO2e

Total Global Primary Market 2010: 29.0 MtCO2e

Total Global Secondary Market 2010: 1.2 MtCO2e

Aways to go to reach 140 Mt.per year.

Gary
Guest
Gary

Where is the rent a demo mob from greenpeace and the green party?? They are very quiet on something that they should be making some noise on!! It can be assumed this is the world they want.

Andy
Guest
Andy

Of interest to Wellingtonians: seminar tomorrow (Wed 6th Oct, Dr David Wratt)

Seminar 6th October 2011 12-1pm
Speaker: Professor David Wratt – Assessing Scientific Knowledge about Climate Change
Venue: Kelburn Campus, Cotton 304


Work has now begun on the IPCC’s Fifth Assessment, due for completion in 2014. This presentation will summarise significant findings from the IPCC’s Fourth Assessment completed in 2006 followed by a discussion of some areas of active scientific interest and research since 2006, including polar ice sheets and sea level rise, ocean acidification and its impacts, geoengineering, and ways of accounting for non-carbon dioxide greenhouse gases (“metrics”). Key results from the IPCC’s 2010 Special Report on Renewable Energy Sources and Climate Change Mitigation will be described.

http://www.victoria.ac.nz/climate-change/events/NZCCRI%20Seminar%20Series.aspx

Gary
Guest
Gary

Here is what some countries think of the EU and its Aviation ETS. THESE COUNTRIES HAVE SPINES…Ours does not, we just do what the Euro bureaucrats tell us to do. I just hope the farmers of NZ do not stop at Parliment steps next time with their tractors…just keep going. European Union plans to charge airlines for carbon emissions are “discriminatory” and violate global laws, a group of 26 countries including the United States and China said in a joint declaration released by the Indian government on Friday. India, which hosted a two-day meeting in New Delhi this week, said delegates from the non-EU countries, which are also members of the U.N.’s International Civil Aviation Organization (ICAO) executive council, agreed to lodge a formal protest against the EU’s new rules at the council’s next meeting. “There was wide concern expressed by all countries present, without exception, that the unilaterally imposed EU (emissions trading scheme) measures were inconsistent with the international legal regimes,” the statement said. “The legal infirmities in the EU laws were pointed out. It was stated by the various delegates that they were also discriminatory (to) carriers.” The EU says it… Read more »

Richard C (NZ)
Guest
Richard C (NZ)

This is developing into a huge confrontation on a number of fronts and trade is one of them. I’m sure that the National govt has kept the NZ ETS to ensure favourable trade access to Europe and EU ETS exemption for Air New Zealand but no other real reason than some votes.

You might be interested Gary, that there’s “Economics” under the “Open Threads” button at the top of the blog and a thread header there: “ADAPTION and MITIGATION LAW: INTERNATIONAL IMPOSITIONS and CONSEQUENCES”. The EU ETS aviation deal also has a header with a number of articles linked under that here:-

https://www.climateconversation.org.nz/open-threads/climate/economics/#comment-25985

You can also access a list of topics including “Economics” via this INDEX:-

https://www.climateconversation.org.nz/open-threads/climate/disproving-agw/#comment-26342

PeterM
Guest
PeterM

Hi Richard The 140Mt comes as follows from carbon weekly Business grows for busy market pioneer Friday 24 Jun 11 10:00am A carbon market pioneer is doubling the size of its carbon desk after three years of operation. The OMFinancial desk, started as a sideline in 2008, traded several million tonnes of carbon last year. The company is merging carbon operations with energy and has appointed former head of futures, Nigel Brunel, to head the new carbon and energy desk. He says that carbon is bringing in other business, as clients look to hedge other risks, including energy. “We’ve been working with foresters and emitters on carbon, and it’s natural to talk to them about other aspects of their business,” he said. The company has appointed another trader, Daniel Crawford, to the desk and beefed up support functions. Brunel, who spent most of 2008 educating potential clients about the coming carbon market and in March 2009 brokered the first sale of NZUs under the Emissions Trading Scheme, says he expects the market to grow significantly yet. “Assuming that the Government decides to continue with the scheme, and agriculture enteres in 2015 as planned,… Read more »

Andy
Guest
Andy

Just over a decade ago we had the dotcom bubble (which I was part of as an employee).
People were busily writing books such as “New Rules for the New Economy”, and I was told that we had to pay customers to come to our website rather than the other way around, as it was the “new way”.

I, of course, was sceptical, and rightly so, as we saw the whole thing collapse in 2001.

Now, a decade later, we are told that we can trade thin air, it will make us all (well some of us) rich, and it is the “new way”.

And my reaction is what, do you imagine?

Mike Jowsey
Guest
Mike Jowsey

Andy,
The differences to the Dotcom bubble (which easily spring to mind) are:
CAGW has been building for 30 years or more;
CAGW is being driven by government, with legislation and bulk research funding;
CAGW is not just for geeks.

So, I don’t see it as a bubble which will burst, so much as an over-inflated truck tyre inner tube which has several hundred needle holes in it, yet it is kept inflated by governments, the UN, researchers and financiers like OMFinancial.

We just gotta keep poking holes in it whenever we get the chance. I believe this scam will outlive me. When Climategate broke, I remember a friend saying to me at a neighbour’s BBQ, “The wheels have fallen off now – it’s all over isn’t it?” My response was, “I wish it was that simple”. The apathy of the general public will ensure its survival for decades, imho.

Andy
Guest
Andy

Replying to Mike –
The question is, do you think the EU will outlive you?
I would say the Euro is on its last legs (mind you, the same people that have been saying that about the Euro have been saying the same about AGW)

If the Euro collapses, as many financial commenters have predicted, then the EU will, eventually follow.

The AGW gravy train is predominantly EU driven.

Mike Jowsey
Guest
Mike Jowsey

Replying to Andy –

PeterM quoted the following:

there is a potential market of 140 million tonnes a year,” he said.
“And if Australia, Korea and Japan go ahead with their ETS schemes, there’s the potential for an Asia/Pacific price on carbon, which opens the market up to a lot of potential.”

There are plenty of interested big-money rent seekers around the world greedily contemplating the opportunities. Not just the EU.

But, hey – I love your optimism – here’s hoping it will all coming crashing down within a couple of years and the politicians will all in one united voice say, “Sorry we pushed an agenda to feather our own nests and force our constituents to pay more for less and become an uncompetitive banana republic. Real sorry about that. We were misinformed by the scientific community which we funded with your tax dollars to go find the AGW monster under every rock and in every corner of the sky. Real sorry about that. We should all resign….”

Andy
Guest
Andy

Reply to Mike –
I haven’t been called optimistic for a while!

I am not really anticipating a bunch of politicians apologising or whatever. What I am anticipating is a population that has no food or power, that takes to the streets and ritually slaughters anyone involved in government.

Look at Greece. They need armed guards around parliament to protect the politicians from the people.

This is what we need in NZ. Not a bunch of Listener readers who think that handing bucketloads of dosh to the Chinese to manufacture chemicals is good for our “clean green image”

Mike Jowsey
Guest
Mike Jowsey

Andy, we are in agreement about what might happen (not the pollies saying sorry – that was pure satire). It’s just I don’t see it happening any time soon. Let’s hope your view of an imminent crash of the flying AGW monster (not the flying spaghetti monster) is realised asap. We live in interesting times.

Andy
Guest
Andy

Mike,
We can possibly differentiate between AGW and carbon trading. They are not the same thing: one justifies the other.

Whether the AGW theory is correct or not, we have created a policy response that is based on trading a “commodity” that is thin air.

We have seen Al Gore’s CCX carbon exchange shut its doors. We have seen wild fluctuations in carbon prices globally.
We have seen emitters in NZ buying offshore credits rather than invest in NZ forests.
We have seen numerous scams and fraud.

My understanding of the ETS is that we would eventually move to a market-driven price for CO2, rather than the fixed price of $25. In my communications with the government on this, I got no clarification on which price index this would be based on. I got the impression they didn’t know.

This has all the feel of an economic train wreck to me. The climate will continue to do its thing, with or without our help, but markets built on untraceable, un-auditable (mostly) and invisible substances don’t sound too smart to me.

C E Kay
Guest
C E Kay

There is now no prospect that Japan, South Korea or USA will introduce national ETS regimes. Yesterday, I heard an insider (warmist) claim that there was no way Australia’s carbon tax would convert to an ETS in 2016.

Back in 2004, the shiny new EU ETS was applauded as the pathfinder for schemes that would spring up all over the globe. What happened was that NZ was the sole new ETS during the succeeding seven years.

Administratively, the EU scheme has been plagued by endless frauds and scandals, while carbon pricing has been hopelessly volatile. And the scheme makes no claim to have actually assisted the environment in any measurable way.

Politically, the US Cap ‘n Trade scheme proved so unsaleable that it has disappeared from the radar. The world has watched the Gillard government’s ratings drop to unprecedented lows as she campaigns for a carbon tax. Rudd and Turnbull are evidence that ETS can be a political third rail.

The Kyoto commitments are expiring. The EU has decided not to adopt a more ambitious target. There are very low expectations for the Durban COP17.

Carbon trading is an idea whose time has passed.

Richard C (NZ)
Guest
Richard C (NZ)

Where carbon trading fits in to The Climate Change Scare Machine

See – Financial houses
*******************************************************************************************************
Map: The Climate Change Scare Machine — the perpetual self-feeding cycle of alarm

Climate Change Scare Machine Cycle: see how your tax dollars are converted into alarming messages

http://joannenova.com.au/2011/10/map-the-climate-change-scare-machine-the-perpetual-self-feeding-cycle-of-alarm/

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