Newsletter - April 15, 2020
The severe restrictions placed on the movements of people and goods in India and around the world have had a range of fascinating unintended consequences beyond the massive shock to livelihoods and the global economy. The most apparent of these has been the impact on the air quality in major urban centres, which has gone from near-apocalyptic levels before the pandemic to near-pristine in a matter of weeks. While the Covid-19 virus has locked us away in our homes indefinitely, 90 cities in India recorded minimal air pollution. Levels in Ghaziabad, Delhi, Noida, Greater Noida and Gurgaon – which are India’s five most-polluted cities according to the WHO – dropped by 50% since March 24, when the lockdown was announced. Other cities, often featured on ‘Dirtiest Air’ lists, such as Beijing, Bangkok, Sao Paulo and Bogota, have also reported cleaner air following curbs on mobility and economic activity.
While social media is flooded with posts celebrating clean air unseen in decades, the irony of not being able to enjoy the blue skies and fresh air isn’t lost. Neither has the huge cost that this clean air has come at. The sudden upturn in urban air quality can be ascribed mainly to the halting of construction activity and vehicular traffic, two of the biggest contributors to urban air pollution. While dust from construction activity has been found to contribute up to 58% of cities’ PM10 levels according to a 2011 CPCB study of six Indian cities, vehicular traffic has been repeatedly singled out as the biggest single contributor to levels of PM2.5 and noxious gases such as NOx. A source-apportionment study by TERI in 2018, for instance, found that vehicular transport was responsible for up to 39% of Delhi’s PM2.5 concentrations, 19% of its PM10 count and 81% of its NOx levels. Following the lockdown, levels of PM2.5, PM10, SOx and NOx have all dropped across the board. While Delhi, Noida, Gurugram, Jaipur and Pune have all recorded drops of over 40% in PM2.5 and PM10 levels since the lockdown enforcement, several cities have registered drops of over 50% in NOx levels, with Kanpur registering a decline of 72%!
“The reductions we have seen correspond to the cessation of vehicular traffic, construction activity, industrial activity and brick kiln operations, but for the first time we also have an opportunity to study India’s background levels of PM and other gases, and the influence of meteorological factors,” says Sagnik Dey, associate professor at the Centre for Atmospheric Sciences, IIT Delhi.
Interestingly, the lockdown has also exposed the poor design of air quality monitoring in several cities across the country, which have too few and poorly placed stations that provide an incomplete picture of pollution levels. For example, monitoring stations in some major cities have recorded a drastic drop in NOx levels – in Pune, levels reduced by 62% in the week starting April 6, followed by Mumbai (60%), Delhi (50%) and Ahmedabad (32%), according to SAFAR data. But, between March 23 and March 30, the four monitoring stations in Chennai showed little to no variations, revealing discrepancies in the Continuous Ambient Air Quality Monitoring Stations data.
But no matter how you cut it, the significant drop in pollution levels is undeniable. While the abrupt economic shutdown that it has taken to achieve this cannot substitute for a concrete clean-up plan, the cleaner air being seen in cities offers a desirable end towards which India’s clean air policies must aspire. The fact that a path to this end cannot be achieved without a deviation from the norms regarding urban mobility and development brings India’s National Clean Air Programme (NCAP) into sharp focus.
And it isn’t just sheer volume of pollutants pumped into India’s urban atmosphere that the current lockdown has revealed, it has also highlighted the morbidity that these levels signify. While simplistic prima facie studies linking particulate matter (PM) exposure to vulnerability against COVID-19 have been contested, there is little doubt on the long-term effects of air pollution on human health. Several studies over the past decade have linked exposure to polluted air with susceptibility to lifestyle disorders such as diabetes, hypertension, and other cardiovascular and cerebrovascular ailments.
These, especially diabetes, in turn have been identified as prominent comorbidities that escalate the impacts and fatality of the novel coronavirus among patients, according to a recently published Lancet study. Air pollution was also linked to increased mortality during the 2002 Severe Acute Respiratory Syndrome (SARS) pandemic. “The hypothesis that there is a direct link between air pollution exposure and COVID-19 infection rates does not hold water. But long-term exposure contributes to several comorbidities, which make COVID-19 more dangerous through indirect linkages. Theoretically, PM suspended in the air also provides surfaces for the virus to settle on which could aid COVID-19 transmission as people breathe these particles and may contract the virus. Overnight reductions will not help in easing the health burden but reducing long-term exposure might make the country more resilient to such infections in the future,” says Arun Sharma, the director of Community Medicine, University of Delhi.
The recent experiences with the response to the COVID-19 pandemic in India is all the more reason to view the NCAP not just as an environmental policy aimed at improving living conditions, but also through the prism of public health. Launched in 2019 with an aim to reduce pollution levels by 20-30% by 2024, what sets the NCAP apart from other air pollution policies is that it recognises the need for coordination across sectors to combat the issue. It has already been allocated Rs300 crore for the development of city-specific plans and more monitoring stations, with another Rs4,400 crore promised in the recent budget. But with only one monitoring station for every 6.8 million people, as per a 2019 analysis, the road ahead is daunting, at best.
What complicates matters further is the large-scale infrastructure and development push that the government is expected to commit to in order to overcome the economic dent left by the response to the pandemic. There are already indications of which way the wind will blow. For example, an environment ministry panel has recommended an automatic extension of forest clearance for government-owned mines, whose lease period got a 20-year extension. Prakash Javadekar, the minister for Environment, Forests and Climate Change, also announced clearances to around 100 infra and development projects, many of which are located in areas considered by experts as eco-sensitive such as the Western Ghats.
There has also been reluctance and continued uncertainty regarding coal and thermal power investments in the country. Union Finance minister Nirmala Sitharaman, while announcing the budget for the NCAP programme this year, said state utilities will be ‘advised’ to close down old thermal power plants that do not meet the emission standards. While experts believe shutting down such plants would largely improve air quality, the government’s vague stance on this issue doesn’t help matters. This despite increasing evidence that coal has and will continue to become more expensive relative to renewables. A report published by Carbon Tracker just last week states that 51% of the country’s coal power costs more to run than building new renewables and that almost a quarter of the planned 66 GW thermal power capacity will enter the market with negative cashflow.
Similarly, the COVID-19 pandemic must also serve as a point to embark on a path to cleaner urban mobility. While the government tries to straddle the fine line between e-mobility and IC-engine vehicles, the lockdown numbers make a compelling case for cleaner transport. Struggling auto companies will undoubtedly present a strong case for an industry specific fiscal stimulus, but the government must emphasise on a faster transition to e-mobility and work out a plan to fund the re-skilling of workers towards EV manufacturing if clean air is to remain an achievable goal.The steps required to ensure that a return to economic activity is accompanied by robust holistic action on India’s air is far from a simplistic one and would require coordination between and within several levels and agencies of the government and civil society. But if there’s one lesson that the response to the COVID-19 pandemic has left us with, it is that even the most extreme measures fall firmly within the realms of possibility if it can inspire political will and public support.
The coronavirus pandemic has brought everything to a standstill, including scientific fieldwork. Scientists fear that this could affect climate monitoring and research after major projects aimed at gathering environmental data have been postponed or cancelled.
While these are long-term studies, scientists have warned that routine monitoring of weather and climate change could also be affected if the pandemic repercussions are felt for an extended period of time.
Great Barrier Reef suffers third major bleaching event in past five years
Australia’s Great Barrier Reef suffered another major bleaching event this year – the third one in the past five years. With a distance of 2,000 km, it is proving to be the most extensive yet, experts said. A rise in temperatures, linked to climate change, are to be blamed, according to experts. Around 25% of the reef has experienced severe bleaching, while 35% has been moderately bleached and 45% remains untouched. The reef’s southern section, which remained mostly intact during bleaching events in 2016 and 2017, was hit hard this year.
But the change could be reversible, if a recent study is to be believed. It stated that a ‘substantial recovery’ of ocean life was possible by 2050, but only if major threats such as climate change are dealt with.
Study predicts sudden loss of world’s wildlife if climate change persists
A new study in the journal Nature pinpoints the locations where ecosystems could be severely disrupted if global warming continues to rise. The study created 100km x 100km grids by cross-referencing climate data from 1850 to 2005 with the geographic ranges of 30,652 species of birds, mammals, reptiles, amphibians, fish, and other animals and plants.
After observing the grids, the researchers found that most species in a given grid ecosystem were able to adapt to a certain temperature until they were all forced out of their comfort zone at the same time. This means if temperatures were to rise to a level that a particular ecosystem wasn’t able to adapt to, most species in that area would be driven to extinction.
Current climate models missing most of coarse dust in atmosphere: Study
Climate models are missing most of the coarse dust in the atmosphere, and are therefore underestimating its impact on ocean ecosystems, clouds and global climate, a study recently concluded.
The study found the mass of coarse dust in the atmosphere to be four times more than what is simulated in climate models currently. Such models must incorporate the actual amount of coarse dust in order to accurately simulate its impact on the global climate, the study stated.
Methane levels reached all-time high in 2019
Levels of methane, a potent greenhouse gas with a warming potential 28 times that of carbon dioxide, has reached an all-time high spurred by an increase in emissions in 2019. According to the US’ National Oceanic and Atmospheric Administration’s (NOAA) preliminary data, global methane concentration in the atmosphere has reached 1875 parts per billion (ppb) in 2019 after recording 1866 ppb in 2018. While the source of the emissions spike is unclear, scientists hypothesise that it might be due to increase in microbial activity releasing methane which itself is spurred on by higher temperature owing to climate change, creating a dangerous feedback loop.
New hole opens up in ozone layer over Arctic
The European Space Agency (ESA) has observed a new hole that has started to form over the Arctic. While ozone layer depletion is a common occurrence over the North Pole, scientists said this time, extreme weather (linked to climate change), and atmospheric conditions have led to a far deeper depletion than before.
While scientists believe the hole will close up by the end of April, they warned that it was a troubling sign of the state of Earth’s environmental health. The Arctic hole is less than 1 million sqkm in size, which is still significantly less than the one over Antarctica, which can grow to be as much as 25 million sqkm.
Forests may not hold key to lock away carbon, studies explore forest-climate feedback loops
Two new studies have shown how feedback loops between climate change and forests may limit forests’ ability of carbon sequestration from the atmosphere, and lead to increased deforestation, further feeding into the problem. The first, a study published in Nature, examines the belief that mature forests are the weapon of choice when it comes to driving sequestration of additional carbon from the atmosphere by constructing a comprehensive carbon budget for a mature forest. Researchers found that while increasing ambient carbon levels increased uptake levels in the forest, this did not translate to any increase in ecosystem-level sequestration. According to the paper, the majority of the extra carbon was emitted back into the atmosphere via several respiratory fluxes, with increased soil respiration alone accounting for half of the total uptake surplus. Meanwhile, a separate study conducted in the Amazon basin quantified an active feedback loop between the droughts and deforestation. According to the paper, every mm of additional water stress was leading to deforestation increases by 0.13% per year while deforestation itself had caused drying to increase by 4%- which would further spur deforestation.
Infrastructure projects in 11 states were approved by the Standing Committee of the National Board for Wildlife (NBWL) in its first-ever video-conferencing meet held this past fortnight. As part of the government’s environmental clearance process, projects that encroach in forests or protected reserves are to obtain approval from the NBWL. Some of the projects that were approved include a highway in Goa to ‘boost tourism’, the Nagpur-Mumbai superhighway, a mining project in Kota, Rajasthan and irrigation projects in Uttarakhand and Telangana, according to Environment Minister Prakash Javadekar’s tweets.
Meanwhile, with an aim to boost ease of doing business, the environment ministry has allowed new lessees to mine for two years before getting fresh clearances.
COP 26 postponed to next year amid Covid-19 fear
The COP 26, which was to be held in Glasgow on November 9 this year, has been delayed and will now be held sometime in the middle of next year because of the coronavirus pandemic.
Environmentalists and climate leaders, however, have vowed to keep up the pressure on governments to act on the climate crisis despite the delay. Experts hope that the delay will give countries time to create a new approach to economic growth that is sustainable and in ‘closer harmony to the natural world’.
Despite COP 26 delay, countries still under pressure to submit updated climate plans
Even though the COP 26 has been delayed, the pressure is still on for countries to submit more stringent climate action plans to the United Nations (UN). The international climate community is still urging countries to submit their increased plans by December 31.
Japan has submitted a plan, but experts are disappointed, because the country has not set firmer targets, but only reaffirmed its 2015 goal – to cut emissions by 26% by 2030. According to environmentalists, Japan’s rehashing of old targets is not only inadequate to meet the larger climate ambitions, it also ‘negates science’.
Chile’s updated plan, meanwhile, commits to peaking its greenhouse gas emissions by 2025. It aims to achieve carbon neutrality by 2050 by phasing out coal, promoting EV use, and expanding forests.
Covid-19 effect: Amend carbon deal amid traffic collapse, says airlines lobby
In a move that environmentalists are calling ‘a dodging of obligations’, the airline industry has written to the International Civil Aviation Organisation (ICAO) asking it to amend the carbon offsetting and reduction scheme for international aviation (Corsia), or risk airlines pulling out of the deal.As part of this deal, airlines have to shell out money to offset any growth in carbon emissions that is above the baseline set by the average emissions of 2019 and 2020. This may become a problem now because with the grounding of flights amidst the coronavirus pandemic, the baseline will be much lower than expected, making the carbon targets much tougher to meet for airlines. The International Air Transport Association (Iata) said it was seeking an amendment in order to “avoid an inappropriate economic burden on the sector”.
Global carbon dioxide co2 emissions may fall over 5% this year, with several countries imposing lockdowns to stop the spread of coronavirus, scientists have said. This will be the biggest drop since World War II, according to the Global Carbon Project, a network of scientists providing benchmark emissions data. Scientists have warned that without lasting structural changes, the emissions will bounce back to where they were.
They point out that the fall is for all the wrong reasons: Over 1,15,000 people have died because of the pandemic, factories are closed, airlines are grounded, power demand has plummeted, millions of people have lost jobs. Experts said global emissions would need to fall by over 6% annually till 2030 – more than 2,200 MtCO2 per year – to limit warming to less than 1.5°C above pre-industrial temperatures, which can only be achieved from structural changes.
Jalandhar AQI at pristine 52, offers rare view of the Himalayas in decades
Three weeks of lockdown in India has cleaned the air enough for people to witness for the first time in decades a view of the Himalayas from their houses. The snow peaks of Dhauladhar mountains, part of Himalayan range, surprised the residents of Jalandhar last week who posted pictures on social media. Air quality Index of the district, about 100 miles from the Himalayas, recorded at 52 micrograms per cubic meter last week, the best over the past decade, a Punjab Pollution Control Board (PPCB) official said.
Before the lockdown, the district’s average daily AQI reading was between 120 and 140. Mandi Gobindgarh, the steel city of Punjab, the AQI averaged 117 before the lockdown and it dropped to 42 during the lockdown period, improving the air quality by 64%. The PPCB officials said the Respirable Suspended Particulate Matter (RSPM) had dropped to 50 micrograms per cubic metre in March; this was 188 micrograms per cubic metre, on average in 2019; 162.5 in 2018; 172 in 2017 and 197 in 2016, HT reported.
Global daily tracker of PM levels warns of major economic slump
Particulate matter (PM) levels dropped 6.8% on April 1 in India since the lockdown was imposed to stop the spread of coronavirus, but the fall began in January, much before the lockdown – that’s the conclusion of the scientists of the Energy Policy Institute of the University of Chicago (EPIC). EPIC tracks both electricity consumption and PM levels every day from government and non-government sources in the US, European Union, China and India. The scientists used daily electricity data for India from Power System Operation Corporation Limited’s daily reports and PM 2.5 data from OpenAQ, a website that aggregates particulate matter readings from monitoring stations around the world.
According to the EPIC tracker, the fall in power consumption because of coronavirus lockdown in these countries resulted in a 6% dip in PM pollution on April 1 compared to December 2019 in these countries. The data shows a 3.37% dip in power consumption in the US, European Union, China and India combined on February 29, relative to the average electricity consumption in December 2019.
With few buyers, automakers slash prices of cleaner BS6 fuel vehicles close to dirtier BS4 fuel vehicles
Automakers were finding it tough to sell cars and bikes before the COVID-19 outbreak, but post the lockdown they have been forced to sell even the new and cleaner BS6 compliant fuel vehicles closer to the price of the older BS4 vehicles they are meant to replace. The pandemic has worsened the auto sector’s troubles in the midst of transitioning to stricter emission norms from April 1.
In the absence of buyers, Toyota has decided to cut the price of BS6 vehicles almost by 50%: their diesel vehicle that was priced at the hiked BS6 price of ₹1.5 lakh is now on the offer for ₹80,000, while the company absorbs the remaining ₹70,000 itself. Dealers told ETAuto that Mahindra, India’s largest utility vehicle maker, did the same even with the fast selling XUV300, which was priced close to the BS4 prices.
Study: Short-term exposure to toxic air impacts gene behaviour, risks cancer, heart diseases
New data from a research study by Monash University researchers in Australia says even short-term exposure to low level air pollution can affect gene expression, leaving people at risk of diseases such as cancer, cardiovascular and respiratory diseases. The study is published in the journal Environmental International.
The researchers studied blood samples from 266 pairs of twins (192 identical and 74 non identical) as well as 165 parents in Brisbane over periods from 2005 to 2010. The periods when the blood samples were taken were matched to data from seven air quality monitoring stations around Brisbane at that time, to measure exposure to PM2.5, and sulphur dioxide.
The researchers studied expression in six genes associated with oxidative stress and inflammation, long considered important features of disease processes initiated by pollutants.
Are India’s wind energy targets for 2020 in a free fall, following the coronavirus-led lockdown? Most of the major turbine manufacturers such as Siemens Gamesa, Vestas, GE and Inox Wind have suspended production. BloombergNEF has slashed its projection of India’s wind energy capacity in 2020 by 24% to 1.95GW from an earlier forecast of 2.56GW. The forecast may further shrink as the lockdown is extended to May 3. Siemens Gamesa and Vestas have also halted production at their headquarters in Spain and Denmark, according to a Reuters report. GE attributed the suspension of production to employee health. Experts say the sector is already troubled by low ceiling tariffs, renegotiation of power purchase agreements (PPAs), and connectivity delays for the past two years.
But some industry insiders said operations can resume as the sector does not have to depend on Chinese imports. Reports suggest foreign markets have also been hit by the developments in India since they depend on the supplies from Indian wind equipment manufacturers. India is the largest wind turbine production base after China in the Asia-Pacific region.
To fight impact on RE imports, India to set up renewable manufacturing units and export services hubs
India has decided to set up solar manufacturing units and export services hubs to minimise the impact of coronavirus on solar import supplies. The government wants all states and ports to identify 50 to 500 acres of land to set up the factories and export service hubs. Companies planning to expand manufacturing and export services in India will be fully backed by the ministry of new and renewable energy (MNRE), the government said. The ministry has also extended the March 31 deadline for approvals for models and manufacturers by six months.
RE sector to get hurt by prolonged lockdown?
Prolonged lockdown will hurt RE generation and increase risk of curtailment by states. Analysts said RE developers will continue to face payment issues from discoms because the 25% fall in power demand will cause discoms a loss of $12. CRISIL expects 3GW to 4GW of projects to get delayed in the next three months as solar supply chains remain disrupted. Exodus of labour will worsen the situation. New projects could head to financial closure and delays in loan payments will impact RE lendings. Experts said currency depreciation is hurting investments, which is why Foreign Institutional Investors are retreating.
The worst hit from lockdowns are small rooftop solar players. According to reports, about 25% of rooftop installation is accounted for by 10-12 leading players. Experts say it is likely the current lockdown may force small firms to go bankrupt or exit the business altogether as they lack financial capacity to bear the losses and they are unlikely to get aid from the government or banks, ET reported.
Tariff ceilings gone, India’s RE sector may see boost by 7GW: Study
India’s removal of tariff ceilings from RE tenders will boost investments and project pipeline by 7GW, ratings agency CRISIL said. RE capacity had dropped to 9GW in FY19 from 12GW in FY18, and it remained subdued in FY20, the agency said.
With ceilings gone CRISIS expects a boost of 6 GW to 7 GW over the medium term. Experts said solar energy companies will now have room to factor in higher risks of low irradiance and execution hurdles, but positive impact can only be expected after COVID-19 pandemic is over.
Covid19: Global solar PV installation to drop 18% in 2020, says Woodmac
According to Wood Mackenzie, global solar PV installations are expected to drop by 18%, from 129.5 GW to 106.4 GW in 2020, amid lockdowns in several countries. Experts said the pandemic and current crash in oil prices is pushing the world into recession in 2020. Analysts said even if economies revive in 2021, the projects that are supposed to deliver then are being developed now. If recession hits, things won’t go as planned. The consultancy firm reduced the 2021 solar PV forecast by 3% from 127.2 GW to 123.6 GW. Woodmac said the recession won’t impact China where the recovery is already underway, work at project sites and manufacturing of solar wafers, cells and modules has resumed. Chinese PV market won’t be affected till August 2020, experts said.
Under-implementation solar projects in India worst hit, says report
Care Ratings latest report said solar projects that are under implementation will be worst hit by the pandemic as solar imports come from China. The report said solar developers will miss deadlines as their execution schedule, which usually happens in the last quarter of the financial year, has coincided with the spread of the virus and the lockdowns. This will impact the installation in the first half of the next financial year 2020-21. Analysts said solar module prices are likely to rise because of the depreciation of Indian currency. The agency warned payments from discoms may get delayed that would lead to liquidity stress on the projects.
REC Ltd sets up SPVs for solar transmission projects in 4 states
Public infrastructure company, active in India’s power sector, REC Limited has approved the incorporation of seven Special Purpose Vehicles (SPVs) to develop solar energy transmission projects in Karnataka, Maharashtra, Rajasthan and Madhya Pradesh. The decision comes following a request for proposals to set up seven projects in the above states on a build, own, operate, and maintain basis.
IREDA given charge of solar projects that require VGF funds
The Ministry of New and Renewable Energy (MNRE) has notified amendments regarding the setting up of 12GW of solar projects planned with Viability Gap Funding (VGF) support. A big change that has been ushered is the transfer of charge of VGF projects from SECI to IREDA. The VGF is provided with an objective to cover the difference between the domestically produced solar cells and modules and imported solar cells and modules. The cap has currently been set at ₹7 million (~$92,288)/MW while the actual VGF will be decided through bidding. The total project cost of the 12 GW solar projects under this program is estimated to be ₹480 billion (~$6.33 billion).
China finalizes $214 million 2020 solar subsidy policy, budget slashed by 50%
China has announced a $214 million subsidy for PV in 2020. One-third of that is allocated for residential rooftop PV and the rest for bidding projects, including distributed PV and utility PV projects. Compared with last year, the subsidy budget was slashed by 50%, PV-magazine reported. China has introduced guided feed-in prices for different types of electricity and finalised its subsidy policy two months earlier than last year.
PV market participants will have to submit all planned projects by June 15 to NEA’s provincial branches to be considered in the central government’s bidding system operation. Residential PV does not need bidding and can start construction immediately. Experts said the developers will have eight months, plenty of time, to finish by the end of this year.
The UK government has announced its plan to decarbonise the country’s transport segment by publishing an 80-page document that will seek inputs from a wide cross section of consumer groups. At 28%, transport accounts for the majority of the UK’s emissions, but the government will aim for zero-emission road vehicles only, and promote public transit as the preferred mode of transportation. The country has also been actively studying electric aircraft.
The plan may get an early boost as a new survey shows the British are now more interested in switching to EVs, largely because of the drop in air pollution due to Covid-19. The survey found that 45% of the respondents would now consider buying an EV — up from 2019’s figure of 41%. Also, 25% of this year’s respondents would consider a purchase within the next five years, as opposed 31% in 2019 saying they would only do so in 10-15 years’ time.
BYD’s new Blade EV battery significantly reduces fire risk
The new Blade batteries by China’s EV giant BYD are reported to have passed severe operational testing and resisted catching on fire. The batteries were subjected to nail penetration, bending, crushing and even being heated in a furnace to 300°C, but their surface temperature stayed within 30-60°C — which is deemed safe in the event of an EV’s on-road accident.
Interestingly, BYD says it will share the technology with other battery manufacturers to spur global advances in EV safety. The technology could engineer a turnaround in public perception towards electric vehicles, as widely circulated reports of accidents involving the batteries or the cars bursting into flames make it harder for manufacturers to attract customers.
EVs bring together Toyota and BYD, GM and Honda
Japanese auto giant Toyota and China’s BYD have come together to build new electric cars, with operations slated to commence in May 2020. BYD is China’s largest EV manufacturer and is fast emerging as one of the top global players. The US’s General Motors (GM) has also announced a partnership with Japan’s Honda Motors, under which the latter will make use of GM’s flexible new platform, which are powered by its Ultium li-ion batteries.
The two partnerships are expected to result in a increased economy of scale, a slew of new electric cars for the global market and advancements such as hands-free driver assistance, which is currently under development at GM.
Plug-in cars make up 75% of Norway’s new auto sales, Belgiam market jumps 91%
Plug-in cars dominated new auto sales in Norway, which in March accounted for a whopping 75% of all sales, and battery EVs alone made up 56% of the share. Hybrids, on the other hand, were 7% of the numbers, while petrol and diesel cars together accounted for just under 18%. Norway leads the world in per-capita adoption of EVs, and their drop in their sales of 26.7% due to Covid-19 has also not been as severe as the country’s 32% overall contraction in auto sales this quarter.
The Belgian plug-in vehicle (PEV) market is also expanding rapidly as reports suggest their sales shot up by 91% in Q1 2020. This is despite the country’s overall numbers falling sharply by 48%. Its PEV market share has now grown to 8.6% — which, considering that it was only at 2.6% in February 2019, is again quite impressive.
Saudi Arabia has cut oil prices again, after the OPEC+ and Russia consortium agreed to slash production by 10% to shore up prices. Saudi Aramco is now reportedly offering crude oil to its Asian customers — primarily China — at a heavy discount, with the underlying motive of capturing more market share from Russia, the US and the rest of OPEC’s members.
The news has caused Brent Crude to fall to around $30/barrel again, after a temporary high of $36/barrel two days ago.
Meanwhile, prices for US oil are yet to recover, and it is forcing several players to cease operations as the current retail price of around $21/barrel is too low for them to stay afloat. Reports suggest the US oil industry could wait out the Covid-19 emergency at $30/barrel, even if that meant laying off a majority of their personnel, but at current prices that is improbable. Output of natural gas from its shale fields is down as well over poor demand.
German carmakers urge EU to drop tighter emission cuts
Rattled by the coronavirus-induced drop in sales, German automakers have asked the government to back them in their demand for the EU to drop tighter emission limits on conventional cars. The limits would force automakers to produce cleaner cars that together would lower the EU’s automotive emissions, but they insist that “now is not the time”.
Environmental Action Germany has rebuked the demand, saying that the auto industry should not use the pandemic as an excuse to “sabotage EU climate goals”. However, similar expectations may be voiced from car manufacturers in other markets, such as Australia — where passenger vehicle sales are down 18% y-o-y, and India, which is down 52%.
California re-opens fracking despite governor’s pledges
The state of California has issued licenses to 24 wells and effectively re-introduced fracking after a nine-month moratorium. The licenses were issued to a joint venture between Shell and Exxon Mobil despite the state’s governor, Gavin Newsom, having promised to ban fracking altogether.
The decision is very likely to be contested in court, and its opposers may find support in UK’s legislation to ban the practice after studies showed the wells destabilised the ground underneath and made regions more vulnerable to damage from earthquakes.