Monthly Archives: January 2015

Burnable: peat bogs’ 850bn tonnes of carbon





The greatest concentrations of the world’s soil carbon have been pinpointed by researchers – and much of it is a dangerously flammable addition to climate change concerns.

An international scientific survey of peat bogs has calculated that they contain more carbon than all the world’s forests, heaths and grasslands together – and perhaps as much as the planet’s atmosphere. Since peat can smoulder underground for years, it is another potential factor in global warming calculations.

Peat is simply leaf litter that never completely decayed. Ancient peatlands become distinctive ecosystems and, in some places, an economic resource.

Merritt Turetsky, an ecosystem ecologist at the University of Guelph, Ontario, and colleagues report in Nature Geoscience that peatlands cover between only 2% and 3% of the planet’s land surface, but store 25% of the planet’s soil carbon.

In the high latitudes of the northern hemisphere, peat bogs cover about 4 million sq km and store between 500 and 600 billion tonnes of carbon.

In the tropics – and especially in south-east Asia – they cover about 400,000 sq km and store 100 billion tonnes of carbon. The entire pool of atmospheric carbon, in the form of carbon dioxide, adds up to about 850 billion tonnes.

Human disturbance creates peat fire threat

In its pristine condition, a peat bog is unlikely to burn: the peat exists because vegetation doesn’t decay normally in water. But, over thousands of years, humans have drained the peat bogs, exploited them for fuel, and even used peat as a gardening mulch.

Dry peat burns easily, and some of the largest fires on Earth are now in the drained peatlands, says Dr Turetsky:

“When people think of a forest fire, they probably think of flames licking up into treetops, and animals trying to escape. But peat fires tend to be creeping ground fires. They can burn for days or weeks, even under relatively wet conditions. They lack the drama of flames, but they produce a lot of smoke.”

The research by Canadian, British, Dutch and US scientists is part of a wider global attempt to understand the carbon cycle.

Global warming happens because more carbon goes into the atmosphere as carbon dioxide than plants in the oceans and on land can absorb. So it makes sense to work out in fine detail where the carbon comes from, and how it is soaked up by living things.

The world’s biggest ever fire? 2.5 billion tonnes of carbon

Peat fires are an enduring hazard, and a local threat to human health. But in a warming world, in which the human population has trebled in one lifetime, the peatlands are drying out, and could fan the flames of climate change.

Once started, peat fires are hard to stop. Fire in the treetops can race across the forest at 10 kilometres an hour, while smouldering peat can take a week to travel half a metre. But both can happen at once, the scientists report.

“The tropical peatlands of South-east Asia are a clear demonstration of how human activity can alter the natural relationships between ecosystems and fire”, said Susan Page, professor of physical geography at the University of Leicester, UK, and a co-author of the latest report.

In a Nature study in 2002, she calculated that a dramatic and sustained forest fire in Indonesia in 1997 may have sent 2.5 billion tonnes of carbon into the atmosphere – a figure that could have added up to 40% of all the emissions from all the fossil fuel burning that year.

“Tropical peatlands are highly resistant to natural fires, but in recent decades humans have drained peatlands for plantation agriculture”, she said.

“People cause the deep layers of peat to dry out, and also greatly increase the number of fire ignitions. It’s a double threat.”

 


 

The paper:Global vulnerability of peatlands to fire and carbon loss‘ by Merritt R. Turetsky, Brian Benscoter, Susan Page, Guillermo Rein, Guido R. van der Werf & Adam Watts, is published in Nature Geoscience.

Tim Radford writes for Climate News Network.

 

 






Burnable: peat bogs’ 850bn tonnes of carbon





The greatest concentrations of the world’s soil carbon have been pinpointed by researchers – and much of it is a dangerously flammable addition to climate change concerns.

An international scientific survey of peat bogs has calculated that they contain more carbon than all the world’s forests, heaths and grasslands together – and perhaps as much as the planet’s atmosphere. Since peat can smoulder underground for years, it is another potential factor in global warming calculations.

Peat is simply leaf litter that never completely decayed. Ancient peatlands become distinctive ecosystems and, in some places, an economic resource.

Merritt Turetsky, an ecosystem ecologist at the University of Guelph, Ontario, and colleagues report in Nature Geoscience that peatlands cover between only 2% and 3% of the planet’s land surface, but store 25% of the planet’s soil carbon.

In the high latitudes of the northern hemisphere, peat bogs cover about 4 million sq km and store between 500 and 600 billion tonnes of carbon.

In the tropics – and especially in south-east Asia – they cover about 400,000 sq km and store 100 billion tonnes of carbon. The entire pool of atmospheric carbon, in the form of carbon dioxide, adds up to about 850 billion tonnes.

Human disturbance creates peat fire threat

In its pristine condition, a peat bog is unlikely to burn: the peat exists because vegetation doesn’t decay normally in water. But, over thousands of years, humans have drained the peat bogs, exploited them for fuel, and even used peat as a gardening mulch.

Dry peat burns easily, and some of the largest fires on Earth are now in the drained peatlands, says Dr Turetsky:

“When people think of a forest fire, they probably think of flames licking up into treetops, and animals trying to escape. But peat fires tend to be creeping ground fires. They can burn for days or weeks, even under relatively wet conditions. They lack the drama of flames, but they produce a lot of smoke.”

The research by Canadian, British, Dutch and US scientists is part of a wider global attempt to understand the carbon cycle.

Global warming happens because more carbon goes into the atmosphere as carbon dioxide than plants in the oceans and on land can absorb. So it makes sense to work out in fine detail where the carbon comes from, and how it is soaked up by living things.

The world’s biggest ever fire? 2.5 billion tonnes of carbon

Peat fires are an enduring hazard, and a local threat to human health. But in a warming world, in which the human population has trebled in one lifetime, the peatlands are drying out, and could fan the flames of climate change.

Once started, peat fires are hard to stop. Fire in the treetops can race across the forest at 10 kilometres an hour, while smouldering peat can take a week to travel half a metre. But both can happen at once, the scientists report.

“The tropical peatlands of South-east Asia are a clear demonstration of how human activity can alter the natural relationships between ecosystems and fire”, said Susan Page, professor of physical geography at the University of Leicester, UK, and a co-author of the latest report.

In a Nature study in 2002, she calculated that a dramatic and sustained forest fire in Indonesia in 1997 may have sent 2.5 billion tonnes of carbon into the atmosphere – a figure that could have added up to 40% of all the emissions from all the fossil fuel burning that year.

“Tropical peatlands are highly resistant to natural fires, but in recent decades humans have drained peatlands for plantation agriculture”, she said.

“People cause the deep layers of peat to dry out, and also greatly increase the number of fire ignitions. It’s a double threat.”

 


 

The paper:Global vulnerability of peatlands to fire and carbon loss‘ by Merritt R. Turetsky, Brian Benscoter, Susan Page, Guillermo Rein, Guido R. van der Werf & Adam Watts, is published in Nature Geoscience.

Tim Radford writes for Climate News Network.

 

 






2015 – the fossil fuel endgame begins





2014 was the hottest year on record. It was also the year, the industry that’s driving the warming came under unprecedented fire. As temperatures rise, so does the climate movement!

At the climate talks in Lima in December, politicians were for the first time talking about a goal to phase out carbon emissions by mid-century. That would mean the end of the fossil fuel industry as we know it.

2015 is going to be critical for the climate. At the end of the year, world leaders will gather in Paris to attempt once again to secure a global climate deal.

Given their track record, they will not act in accordance with the urgency of the climate crisis while the fossil fuel industry holds the balance of power. Therefore, the climate movement will turn up the heat to erode the industry’s might.

Already, people all over are gearing up to confront dirty energy projects, demand solutions and build pressure on decision makers. A key effort that has helped to build renewed momentum on climate change last year is the fossil fuel divestment campaign.

Removing the fossil fuel industry’s social license to operate

For decades, fossil fuel companies have successfully blocked political action on climate change. These companies have five times more carbon in their reserves than can be burnt to stay below the politically agreed 2 degrees global warming.

In other words, 80% of their current reserves are unburnable. For Europe, this translates into 89% of coal, 21% of oil, and 6% of gas reserves, according to a study published in the scientific journal Nature last week. Yet, fossil fuel companies spend billions every year to discover and develop yet more carbon.

Every institution that stops funding fossil fuel companies, is taking an active step towards removing the industry’s social acceptance and consequently its political influence. It is therefore not just actual divestment wins, the campaign aims to elevate the public debate leading to a change in social norms.

In 2014, the number of institutional divestment commitments more than doubled. High-ranking figures such as former archbishop Desmond Tutu, UN Secretary General Ban Ki-moon and World Bank president Jim Yong Kim got behind the campaign.

It is hard to believe that the divestment campaign kicked off only just over a year ago in Europe. Since then campaigns urging local authorities, universities, religious and other institutions have popped up at a dizzying pace, adding up to 94 active campaigns throughout the continent.

The European movement has already celebrated a number of big wins. The University of Glasgow has become the first academic institution in Europe to ditch its fossil fuel holdings. Boxtel in the Netherlands and Örebro in Sweden are the first local authorities on the continent to divest.

The Quakers in Britain and the Church of Sweden were among the first faith-based organisations to lead the way, and the British Medical Association has become the first medical organisation in the world to ban investments in fossil fuels.

Making fossil fuels history

Besides the rapid pace with which the divestment movement is spreading, it is its breadth and diversity that lend it its power. Diversity is essential to achieving social change.

What started with student campaigns at US college campuses, now encompasses a large variety of different groups of people. It is a movement of citizens who do not want their pension money invested in companies whose business model is based on undermining the very future their pension is meant to safeguard.

It is doctors who are concerned about the health impacts of climate change. It is people of faith who believe in our moral obligation to care for creation. It is academics demanding their institution’s finances stop undermining its mission.

It is concerned citizens from all walks of life who believe in climate justice, the stewardship role public institutions should play and in doing what’s right.

This first year has only been the start of the divestment movement in Europe. The year ahead already holds big promises as campaigns build their power to confront the power of the fossil fuel industry. The movement is also gaining strength globally. The first divestment campaigns have started in South Africa and the Pacific Islands.

On 13-14 February, the global movement is going to show its collective force. On Global Divestment Day, thousands of people everywhere will turn out to demand institutions do what is necessary for climate action by divesting from fossil fuels.

Local authorities will come under pressure to walk their talk on climate. New campaigns will be launched. University students will hold flash-mobs, vigils, sit-ins and rallies calling upon their endowments to invest in a liveable future.

Faith leaders and people living on the frontline of climate change will band together to urge their communities to divest from climate destruction. Individuals will close their accounts with banks investing in climate chaos.

Fossil fight-back goes into a tailspin

Of course the fossil fuel industry and its backers have also started to fight back fiercely, dismissing the movement and attacking divestment decisions.

Maybe it’s just coincidence – but big fossil’s attempt to dictate the terms of the debate comes at a time when large parts of the energy industry are in deep trouble owing to low energy prices, with oil sinking below $50 a barrel, and gas fast following suit.

High-cost ‘unconventional’ oil and gas – from shale fracking, tar sands, the Arctic and deep water marine wells – is already a loss-making proposition. One small Texas shale oil company went bust only last week. Many more will surely follow.

Of course prices could rise again – but the current financial bloodbath that has overtaken fossil fuels will permanently spook investors, who will no longer see fossil fuel investments as a reliable cash cow, but as a hazardous proposition fraught with financial risk.

As the fossil fuel industry throws more money at fossil fuel expansion, the divestment movement too is turning up the volume.

And now, history is on our side. Investors are turning away from fossil fuels in droves as fear of loss overtakes greed for profit, and as the ‘unburnable carbon’ meme hits home with a resounding slam that will reverberate through 2015, and beyond.

 


 

Melanie Mattauch is 350.org Europe Communications Coordinator. 350.org is building a global climate movement and initiated the Fossil Free campaign.

Action: Global Divestment Day, 13th-14th February.

 

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.

 






UK’s soaraway financial support to foreign fossil fuels





The UK government financial support to fossil fuel industries abroad has soared to over £1 billion a year under the Coalition, according to an analysis by Greenpeace Energydesk.

The total support for fossil fuel industries amounts to £1.76bn-worth of Export Credit Guarantees between 2010-2014, underwritten by taxpayer’s money.

And of that, almost £1.1bn was handed out in the last financial year, 2013 / 2014, more than ten times up on two years previously.

This is despite PM David Cameron recently publicly decrying fossil fuel subsidies, and the financial backing breaks a promise set out in the coalition government’s manifesto.

David Cameron denounced “economically and environmentally perverse fossil fuel subsidies which distort free markets and rip off taxpayers” at the Ban Ki Moon climate summit in September.

The coalition manifesto stated the new government would use Export Credit Guarantees for “innovative and green technologies, instead of supporting investment in dirty fossil-fuel energy production.”

UKEF’s fossil fuel support hits new heights

UK Export Finance Agency (UKEF) is authorised by the government to decide what to financially back and their main instrument is the Export Credit Guarantee. These are designed to minimise the risk of making deals abroad for UK exporters.

In practice this means UKEF can work with banks to partially underwrite bonds that are a sort of insurance policy on the contract – and expected by the overseas buyer to be provided by the exporter. This supports the deal by releasing the working capital paid by the overseas buyer to the exporter, which can be used instead of placing it with the bank.

UKEF also provides insurance for UK exporters to protect against non-payment or other issues that commercial insurance won’t provide, as well as sometimes lending money to the buyer of the UK export so that they can pay them directly.

In the four years since the coalition government came into power in 2010, UKEF has announced significant support for a range of overseas fossil fuel projects – from backing for coal mining in Russia to oil and gas exploration in Brazil.

Last financial year was a particularly big one in terms of financial backing for fossil fuel projects, with over £380 million going to Brazilian state-controlled energy giant Petrobras – which also happens to be embroiled in an ongoing corruption scandal.

This was as part of a US$1 billion – around £660 million at current rates – line of credit signed with the firm in 2012. The deal involves UK drilling services for oil and gas exploration in Brazil, and presumably offshore exploration, too, since one of the UK firms specialises in subsea engineering.

There was also what UKEF called its “largest limited recourse project financing” that it has ever supported – around £475 million so going to support the build of petrochemical complex in Saudi Arabia by a UK construction firm.

UKEF’s big favourite: Russian coal

Since 2010 there has been six instances of financial support pledged to Russia by UKEF, totalling around £430 million. This includes hefty support for Russian coal projects, financial backing for state-owned gas giant Gazprom to receive engineering equipment from Rolls-Royce Power Engineering, and expertise and software to other fossil fuels projects.

Around £67 million of the UKEF backing for Russian fossil fuel developments has even gone to US-based Joy Mining, which has a manufacturing arm in the UK. The money has supported the export of mining equipment to Siberian Coal & Energy Co (known as SUEK) and Southern Kuzbass Coal Co OAO.

SUEK is the largest coal producing company in Russia and is one of the companies that the UK imports its coal from – roughly 30% of Russian coal imports to the UK. A Greenpeace investigation found the UK spends nearly a billion pounds each year importing coal from Russia.

SUEK’s chairman Andrew Melnichenko has connections to the the UK government, the investigation found. His long-standing advisor George Cardona, is a former special advisor to Geoffrey Howe.

The Energydesk analysis comes after reports that the German government will give financial support for the export of coal-fired power-plants by the country’s manufacturers. Late last year French President Francois Hollande announced that France will stop public export credits for coal projects in developing countries.

A recent report by the Overseas Development Institute (ODI) revealed that the UK was still giving close to £1.2 billion annually to support exploration for oil, coal and gas. That includes both national subsidies (including tax breaks for North Sea oil exploration), and some $663 million (£425m) per year in public finance for overseas exploration including in Siberia in Russia, Brazil, India, and Indonesia.

But as reported in The Ecologist, those figures related to 2012. The new figures for UKEF support for fossil fuels in 2013 / 2014 are certain to push that total to a new record.

 


 

This article was originally published on the Greenpeace Energydesk blog. This version has been edited by The Ecologist.