DAVOS 2019: Grim Climate “RISK REPORT”, Are Leaders Listening?

Newsletter - January 24, 2019

Most dangerous: Climate change-fuelled extreme weather event has been classed as the worst economic threat by the WEF | Image credit: CarbonBrief

Davos 2019: Grim climate “risk report”, are leaders listening?

“The Garden of Eden is no more”  — this was the stark warning naturalist and broadcaster David Attenborough delivered to leaders at the World Economic Forum (WEF) at Davos this week. The world needs to “move beyond guilt or blame, and get on with the practical tasks at hand,” he said. In its  latest Global Risk Report, WEF said extreme weather and countries’ failure to tackle climate impacts were top risks the global economy faces in 2019.

But are business leaders listening? Analysis by the Air Charter Service, says private jet flights to WEF Davos grew by 11% in 2018, and this year, around 1,500 individual private jets will fly to and from Davos, as leaders go for more expensive aircraft. Meanwhile, “Globalisation 4.0” was the solution that the business elite offered to tackle climate change. However, analysts say “economic, social and environmental problems are interconnected, and require more than a shift in business to fix them.”

While New Zealand PM Jacinda Ardern called for environmental ‘guardianship’, Brazil’s president Jair Bolsonaro invited global investors to exploit the Amazon forest. The US, meanwhile, skipped being physically present at Davos, with secretary of state David Pompeo joining via satellite link, where he denied US was isolated on the world stage.

Climate Science

Severely threatened: Depleted groundwater reserves could be catastrophic – which is exactly what Nature’s new study warns about | Image credit: Aljazeera

Climate ‘time bomb’ ticking in world’s groundwater: Study

Climate change has hastened the clock of an underground time bomb ticking away in the form of rapidly depleting groundwater reserves, says the latest study published in Nature Climate Change. Extreme weather events such as drought and record rainfall, worsened by global warming, could exhaust groundwater reserves (already depleting with the increase in world population and crop production) much faster than they replenish naturally, the study says. "Groundwater is out of sight and out of mind. This massive hidden resource that people don’t think about much yet underpins global food production," said Mark Cuthbert, from Cardiff University’s School of Earth and Ocean Sciences.

Cuthbert and his team found that only half of all groundwater supplies are likely to fully replenish or re-balance within the next 100 years, resulting in a  shortage in drier areas.

Natural disasters caused loss of $653 billion  in past 2 years: Study

The latest study by UK-based insurer Aon says that consecutive natural disasters in 2017 and 2018 caused economic loss to the tune of $653 billion. The costliest insurance loss in 2018 was the Camp Fire in California at $12billion. The forest fire, California’s deadliest, destroyed 18,804 structures, mostly in the city of Paradise, while Japan and Kerala were hit by “multi-billion dollar floods”, the study says. Steve Bowen, of Aon’s impact forecasting team, said, “…volatile weather patterns are forcing new conversations to sufficiently handle the need for mitigation and resilience measures. Natural disasters are always going to occur. How well we prepare can and will play a key role in future event losses.”

Study: WHO prediction of 250,000 deaths a year due to climate change was conservative estimate

New research published in the New England Journal of Medicine says rising global temperatures could result in many more deaths than the 250,000 a year the World Health Organization (WHO) predicted just five years ago. The WHO, in its 2014 report, had said that climate change will bring with it malaria, diarrhoea , heat stress and malnutrition, killing that many more people annually around the world from 2030 to 2050.
Scientists reviewed the WHO study to establish that “250,000 deaths is a "conservative estimate."

EAT-Lancet: Healthier diet, sustainable farming needed to save planet

New research takes the adage ‘you are what you eat’ to the next level. According to a study by the EAT-Lancet Commission on Food, Planet and Health, one way this planet can be saved is if its inhabitants make the switch to a healthier diet and sustainable farming. The study says that people living in both developed and developing worlds are undernourished because their diet lacks essential nutrients, which, it says, can lead to more death and disease compared to unsafe sex, alcohol, drug and tobacco use combined.  

The study also terms the world’s food system ‘unsustainable’. It identifies food production as one of the major causes for environmental damage, biodiversity loss and climate change. The report sets out for the first time a “safe operating space” within which future food systems must function to be sustainable. This includes exact figures on how much food production can lead to greenhouse gas emissions, biodiversity loss and air pollution.  

If these aims are met by 2050, the report says it will be a global “win-win”, even as the world population increases.

Report: World to miss ‘best chance’ to fight climate change

A study by World Resource Institute says the world will fail to ensure that emissions peak by 2020 and it will miss the “best chance” of preventing runway climate change. The report says the world will not be able to meet the six milestones experts identified in 2017, including quitting coal power plants, and phasing out fossil fuels by 2020.

Climate Policy

Brazil’s environment minister cancels NGOs’ funding for 90 days

President Jair Bolsorano’s new environment minister Ricardo Salles has suspended all agreements with NGOs and their funding for 90 days, to “re-evaluate partnerships”. Civil society organizations described the move as illegal (contracts with the government can only be cancelled through a formal process after irregularities have been found). Salles, hand-picked by the agro-business caucus, has called global warming a “secondary issue”, and dismissed fines for environmental crimes as “ideological”.

Several green projects in Brazil are financially backed by foreign entities . Salles suspended one such project, the Amazon Fund, which is administered by Brazil’s national development bank, BNDES, and is funded through donations mostly from the Norwegian and German governments. In the Amazon, deforestation has increased by 13% , the largest clearance in a decade.

Davos Risk Report 2019: Risk of global climate action failure has risen in 2019

The latest survey by the World Economic Forum says the risk of global efforts failing to fight climate change has risen despite growing concerns about powerful storms, floods, and droughts. The annual Global Risks Report highlighted several top risks for 2019. Extreme weather was deemed the riskiest of all in the survey, which interviewed 1,000 experts from government, business, academia and non-governmental organizations. The risk of governments failing to limit the magnitude of climate change and adapt to it rose to second place in terms of both likelihood and impact.

Central banks to include climate change while designing monetary policy

Experts have said central banks will have to take into account climate change while designing their monetary policy, which cannot be just based on inflation targets of two to three years. In recent years, extreme weather has forced the banks to take into account sudden changes in the economy. In 2018, the Bank of England stalled plans to raise interest rates because it realised the blip was “due to the weather, not the economic climate”. The US Federal Reserve attributed a weak first-quarter growth to freak snowstorms. Climate uncertainty is making it difficult for banks to get the monetary policy right.  The Financial Times report says, “The consensus is that climate change will, over time, mean lower economic growth and higher inflationary pressure — the kind of supply side shock that monetary policy finds hardest to deal with.”

Study: Indian corporations commit to bold climate action, push India to top 5

Twenty-five Indian companies, including Wipro, Hindustan Zinc and Mahindra Sanyo, have committed to bold targets to reduce emissions and adopt renewable energy pushing India to fifth position after the US, Japan, Britain and France in corporate climate action. That’s the annual report by NGO Carbon Disclosure Project (CDP). In 2018, 52 Indian companies responded to CDP’s climate change questionnaire, of which eight companies came forward on their own volition to disclose their climate impact to the CDP.

Air Pollution

UK releases Clean Air Strategy, aims to save £5.3 billion/year in public health costs by 2030

The UK government has released a new Clean Air Strategy to tackle the country’s existing air pollution problem. The strategy will address every source of pollutants – including ammonia emissions from agriculture and particulate matter from wood-burning stoves. It will also commit the government to phasing out all fossil fuel cars and vans by 2040.

The strategy is part of the country’s 25-year environment plan and aims to save at least £5.3 billion/year in public health costs by 2030. Local authorities will be conferred with enhanced powers under the plan to deal with heavy pollution, and the strategy will employ a nationalised data analytics portal on air quality to drive citizen engagement on air quality measures.

India’s top court on VW case: Bring other carmakers under the scanner as well

Widen the judicial scanner from the case of Volkswagen ‘cheat device’ (placed in diesel cars to flout emission norms), to other major car manufacturers. That’s the recommendation of the Supreme Court of India to the National Green Tribunal (NGT). The top court, however, stopped the green panel from taking any punitive action against the directors of the company as it has complied with NGT’s orders and deposited Rs 100 crores with the Central Pollution Control Board (CPCB).

Volkswagen had moved the top court challenging the NGT order. But on January 17, the green court had warned Volkswagen that if it fails to deposit the fine within 24 hours, its directors would be sent to jail.

Excess of brain-damaging heavy metals in Delhi, Gurgaon air: Report

While the levels of PM2.5 (fine particulate matter) in Delhi’s air remain between twice to ten times the legal limits, new research by NGO Lung Care Foundation, based on seven air-quality tests taken in New Delhi and Gurgaon, detected  “alarming levels” of brain-damaging heavy metals – manganese, lead and nickel – in the air. The levels of manganese exceed the US EPA Reference Concentration for exposure to manganese (0.05 microgram/m3) and the World Health Organisation annual health-based guidelines value of 0.15 microgram/m3. “Levels of lead in six of the seven tests exceed the US EPA 3-month average for exposure to lead (0.15 micrograms/m3) and in two tests exceeds the Indian NAAQS Annual and the WHO annual health-based guidelines value of 0.05 microgram/m3,” it said.

Nickel levels in all the tests exceed the WHO annual health-based guidelines value of 0.0025 microgram/m3, which is based on the risk of cancer associated with long-term exposure to nickel.

There are no standards in India for manganese in ambient air, the report said.

Air pollution causes loss of sleep: US study
Latest American research says polluted ambient air causes loss of sleep. The American Thoracic Society study links obstructive sleep apnea with rise in fine particulate pollution (PM2.5) and nitrogen dioxide (NO2), a traffic-related pollutant.

“Prior studies have shown that air pollution impacts lung and heart health, but only a few studies have looked at how air pollution might affect sleep,” said Martha E Billings, lead author of the study and associate professor of medicine at the University of Washington. “It seemed likely that air pollution was detrimental to sleep, given that it causes upper airway irritation, swelling and congestion, and may also affect the parts of the brain and central nervous system that control breathing patterns and sleep,” Billings said.

Air pollution decreasing levels of happiness in China

Polluted air is decreasing happiness levels in China, despite 8% economic growth, that’s the conclusion of data analysing of millions of social media posts in 144 Chinese cities. the Massachusetts Institute of Technology (MIT) research published in Nature Human Behaviour says on polluted days, people are more likely to engage in impulsive and risky behaviour. Earlier, the study has shown that air pollution is damaging to health, cognitive performance, labour productivity, and educational outcomes


IEEFA: India urgently needs hefty grid investment to match renewable investments

IEEFA says India needs to urgently invest in grid transmission infrastructure to keep pace with growing low-cost renewable capacity so that people can benefit from cheap power supply. India’s economy is expected to grow at 7-8% annually and the corresponding increase in power consumption will require a modernised grid that is capable of absorbing the increasing inflow of variable-output renewable power.

BNEF: Renewables to grow in 2019 as costs fall even further

A new BNEF analysis has predicted that global renewable energy capacity will grow through 2019 over further reductions in the costs of solar and wind power, and of lithium-ion batteries. However, 2019’s total clean energy investment will be at around $300 billion, down from 2018’s $332.1 billion. Analysts say, as costs continue to decline, the low investment will bring more renewable energy capacity. BNEF says, between 125 and 141 GW of new solar will be added in 2019 worldwide, up from around 109 GW added in 2018. While 70 GW of wind capacity will be added in 2019, up from 53.5 GW last year.

BNEF: Solar investment fell 24% in 2018 due to  better technology, China’s policy tweaks

Bloomberg New Energy Finance (BNEF) reports that more than 100GW of solar capacity was added worldwide in 2018, but the pace of addition had slowed from 2017. Investment in solar also fell 24% over 2017 levels. The fall is partly a result of China’s policy tweaks to cool its domestic solar market, that led to a glut in the supply of solar modules — which were sold off at cheaper rates outside its borders.

Improvements in solar module efficiency have also lowered their prices — by as much as 12%, according to BNEF — and brought down the per MW cost of solar installations.

India mulling anti-dumping duty on tempered solar glass imports from Malaysia

The Indian government may impose an anti-dumping duty of $114.58 per tonne on Malaysia-imported tempered solar glass to protect domestic manufacturers from cheap imports. The final decision to impose the duty will be taken by the finance ministry. Gujarat Borosil Ltd. had asked the DGTR to investigate allegations of dumping of tempered solar glass and panels by Chinese and Malaysian manufacturers, and if a duty should be imposed on them to protect domestic manufacturers.

BHEL, LIBCOIN to build India’s first Li-Ion gigafactory

In a joint venture, state-run Bharat Heavy Electricals Limited (BHEL) and the consortium of LIBCOIN, plan to build India’s first lithium-ion battery gigafactory. BHEL is set to launch a study of the facilities, R&D infrastructure and other techno-commercial issues for the same. The plant’s capacity will be scaled up to 30 GWh in due course. The project is another step towards India’s plans to reduce its dependence on fossil fuels.

1GW Maharashtra Solar tender gets oversubscribed by 900MW

1GW solar tender floated in Maharashtra for grid-connected solar projects under Phase II attracted plenty of bidders. The tender has been oversubscribed by 900MW. The upper ceiling cost for the tender had been revised to 2.90/kWh. About 7 solar companies, including Adani, TATA, Renew Solar, ACME solar, bid for the tender aggregating to 1900MW.

CSE: Rooftop solar failing to take off in India
Solar rooftop has failed to flourish in India because the market is tilted towards large-scale renewable energy – that’s the verdict of the another recent study by think-tank Centre for Science and Environment (CSE). The report said India’s rooftop solar target is 40GW capacity by 2022, but till November 2018, only 1,334MW of grid -connected solar rooftop system had been installed. The study pointed out that the preference has been for commercial and industrial installations instead of housing. The report said residential consumers account for less than 20% of the total installed capacity.

New RBI norms may leave renewable energy projects in the lurch

Domestic solar industry lobby, the National Solar Energy Federation of India (NSEFI), has said the Reserve Bank of India’s (RBI) revised policy of External Commercial Borrowings has made it impossible for them to repay rupee loans from the proceeds of foreign lenders. The NSEFI  has requested the Prime Minister’s Office (PMO) to intervene in the matter. The developers said there’s a lack of domestic financing for renewable energy projects and given the land and transmission issues, foreign lenders are also hesitant to give them money, in which case, “developers first take under-construction loans from domestic lenders at relatively higher interest rates and later refinance such high-cost rupee loans by low-cost foreign currency loans from foreign lenders through External Commercial Borrowings once the project is operational.” But the revised ECP policy doesn’t allow them to pay back using foreign finance proceeds.

Electric Vehicles

Delhi’s first e-taxi service launched with 70 cabs

New Delhi has received its first e-taxi service with Gensol Mobility’s Blu-Smart initiative – which has launched 70 li-ion battery powered Mahindra Verito cabs. Blu-Smart will charge customers between Rs.14-16 per km, and aims to boost its cab fleet to 400 by the end of the year. The firm will also soon launch an app for bookings and will reportedly set up 65 charging stations across the NCR for its fleet

NITI suggests zero road tax on EVs, SMEV demands green cess on conventional vehicles

India’s top planning body, NITI Aayog has suggested that EVs be exempted from road taxes to bring their ownership costs down to that of conventional vehicles. The proposal has been sent to state chief secretaries and follows a previous proposal to reduce import duties on EV components from 18% to 5%.

The Society of Manufacturers of Electric Vehicles (SMEV)  – India’s EV industry body – has, on the other hand, requested that the upcoming interim budget levy a notional Green Cess on conventional vehicles to secure more monetary support towards expanding India’s EV market.

Indian Railways to electrify select tracks, BHEL to set up solar EV chargers on Delhi – Chandigarh highway

The Indian Railways is stepping up its plan to become a net-zero emitter by 2030 and has announced it will source solar power to power locomotives on select tracks in 10 states of the country. The move is likely to phase-out 4GW of coal-fired power.  

Meanwhile, India’s heavy machinery giant Bharat Heavy Electrical Ltd. (BHEL) has announced it will set up multiple rooftop solar-powered EV charging stations along the 250km long Delhi – Chandigarh highway. The DC chargers will have both fast- and slow-charging options and will be funded under the Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India (FAME) scheme.

India to receive $300 million from World Bank to expand e-mobility network

India’s Ministry of New and Renewable Energy (MNRE) has confirmed that it will receive $300 million from the World Bank to help expand the country’s e-mobility network. The funds will be sourced through Energy Efficiency Services Limited (EESL) – which pioneered public sector demand for EVs in the country.

The grant will be accompanied by the Centre’s plan to levy one-time charges on conventional 2-, 3- and  4-wheelers to generate an annual corpus of Rs.7,500 crores, which will be used as financial assistance for India’s nascent e-mobility sector.

Trump does a u-turn on EVs, welcomes VW’s investment in Tennessee EV facility

US President Donald Trump has seemingly done a complete u-turn on his public criticism of EVs, and has now welcomed Volkswagen’s plan to invest $800 million in setting up an EV production facility in Tennessee – since it could create several jobs.

Trump had previously criticized General Motors (GM) for its plans to shutter its facilities manufacturing conventional cars and switch to manufacturing EVs instead. Interestingly, the President’s latest opinion may revive federal tax credits for EV customers, which have already expired for GM and Tesla.

Fossil Fuels

Coal's woes continue, as the world's largest coal port announces its decision to abandon the fuel

IEEFA: China pouring billions into dirty coal power across Asia

IEEFA’s new analysis suggests Chinese banks will spend nearly $36 billion to develop 102GW of coal power plants, mines and associated rail infrastructure in Bangladesh, VIetnam, Pakistan and Indonesia. It also suggests the loans will burden the host nations with expensive debt and expose them to coal’s price fluctuations – even though renewables are a better, cheaper option.

Surprisingly, around 23% of the capacity will run on emissions-heavy, subcritical technology, which is too dirty to be allowed within China’s own borders. China instead is expanding its own coal power fleet with much cleaner, supercritical and even ultra-supercritical plants.

Market Forces: Major Australian banks increasing exposure to fossil fuels

A new study by Market Forces has shown that the fossil fuel portfolios of three major Australian banks grew in 2018, after steady declines through 2014 – 2017. The biggest increases were by Westpac – a whopping 147% rise in coal mining projects and by the Australia and New Zealand Banking Group (ANZ) – 27%.

The total exposure of the banks – including National Australia Bank (NAB) and Commonwealth Bank of Australia (CBA) – now stands at $29 billion, as opposed to their  renewables portfolio of $11.5 billion.

Although contradictory to their publicly stated policies on fossil fuels, the banks say the numbers reflect their commitment to reliable and affordable energy prices for the country.

Sinopec Capital urges end to fossil fuel use

Sinopec Capital has urged the world to stop burning fossil fuels at a recent EV forum in China, and to invest in renewable energy and e-mobility. The firm is the investment arm of China’s oil and gas behemoth Sinopec – the world’s largest oil refiner – and has even predicted that fossil fuel vehicles will be replaced by EVs within by 2045.

Germany confirms long-term support for lignite-mining states post-coal phase-out

Germany’s four lignite-mining states have been assured of long-term financial support by the country’s Coal Commission – beyond the $1.7 billion earmarked for them till 2021 – after the country exits coal mining and power (tentatively before 2040).

The four states had demanded up to €70 billion in support from the federal government, and after several internal disagreements, the commission’s final figures are expected to be released at its meeting on January 25th.

Rising US oil & gas output could release 1000 coal plants’ worth of CO2 by 2050

A new report by Oil Change International suggests that the US could release as much as 120 billion metric tonnes of CO2 between now and 2050 – equivalent to the lifetime emissions of 1000 coal power plants – from its ever-increasing exploitation of its oil and gas reserves. The report also suggests that US oil output could double by 2030 – despite it already being the world’s largest oil producer.

This would severely hurt the rest of the world’s meagre carbon budget, but a 2018 report has demonstrated that it is entirely avoidable – as the roughly $20 billion in annual subsidies that the country’s fossil fuel sector receives could easily be instead used to fund a just transition for its workers.