When the chips are down...
Forge the Future #46 - a historic oil deal, and the biggest recorded drop in global emissions
Welcome to Forge the Future, your weekly guide to all things climate.
It feels at the moment as though time has slowed down, with most industries shut down or paused until the world gets a handle on COVID-19. However slow the economy may be at the moment, some things carry on regardless - the OPEC+ cartel and Russia set aside their differences and struck a historic deal to cut oil production by as much as 20%. The implications for the climate are not yet clear, but demand is still at rock bottom and doesn’t look to be shifting any time soon, so we may still be on the cusp of peak oil (though that has been said many times before).
CarbonBrief attempted to quantify the potential impact on emissions of the coronavirus situation - it looks like global pollution will drop by more than 4% - the largest such drop since at least the end of World War 2. However, to put it in perspective, to achieve 1.5°C of warming, the world would need to cut emissions by more than 6% a year, every year until 2030. A widely publicised study this week also found that exposure to air pollution significantly increases fatality rates from the virus - another way in which the two crises intersect.
State of the Climate
CO2 levels this week: 416.45 ppm
This time last year: 412.67 ppm
Deforestation in the Amazon is one of the few industries not slowed by coronavirus - official figures record deforestation up 30% in March, and up 51% over the first three months this year versus last. Some have suggested decreased inspections due to the virus may have enabled loggers to take advantage of the situation. In Africa, poachers are taking advantage of the lack of tourists to target rhinos, with a spate of incidents in recent weeks.
A new study suggests that loss of species could happen in sudden waves, rather than as a gradual decline - whole ecosystems could get overwhelmed at once. However, limiting temperature rise to below 2°C could delay the impacts by up to 60 years. That’s a big deal, when the study suggests that tropical ocean ecosystems could be exposed to potentially catastrophic temperature rise as soon as 2030 if no action is taken.
An ozone hole has opened over the Arctic. Whilst the cause of the ozone depletion is similar to that in the Antarctic, this one has occurred due to an unusual (and temporary) polar vortex, and is expected to close up on its own in a few weeks as the ozone-depleting chemicals are dispersed.
In a more positive note, a historic deal has been brokered between a number of US states to protect the Monarch butterfly along its traditional migration route. The butterfly count has been critically low (and declining) for a number of years, so this is excellent news. The butterfly is not being added to the endangered species list, but the protections will be similar to those for the sage grouse.
Visualisation of the Week
This week’s visualisation comes from the CarbonBrief analysis of the coronavirus pandemic’s impact on global greenhouse gas emissions, comparing it to the five largest falls in emissions ever recorded.
More and more it seems like this current crisis is a warning shot across the bows. I do not mean to downplay the significance of the current situation - it is catastrophic, wreaking havoc across the globe (and will likely continue to do so for months to come at the least). However, we will eventually develop a vaccine. The economies of the world will start to come back online, and we will emerge from our various lockdowns and take stock, and start reassembling our familiar world from what’s left after all is said and done. There will be, there can be a normal after this. It’ll be different, but not that different.
But I suspect when climate change really starts to hit that may not be the case. There is no vaccine for global temperature rise, for mass biodiversity loss, and the countless other impacts both known and unknown that will follow. That means we should learn what we can from this current situation, bad as it is, so we don’t get caught off guard next time.
This crisis has highlighted some of the amazing aspects of humanity that are oft hidden behind closed doors. From the doctors and nurses pulling all hours to do whatever they can, despite often lacking equipment and supplies, to neighbours gathering together to support the elderly and vulnerable around them - because it is the right thing to do. However, it’s also shown that that humanity is ignored by our current economic system. If a crisis shows our true natures, then this one has shown that our economy values unfettered greed - airlines rushing for bailouts, US senators insider trading on virus briefings, and more besides.
I don’t want to tar all companies with the same brush - some have gone out of their way to look after their workers, and help those around them - but the system does not reward that. Selflessness doesn’t make your share price go up. But maybe it should. Maybe this is a time to push for a system that does price caring for people, for the environment. Perhaps we should make ESG a vital part of doing business, rather than window dressing, and ensure that building an equitable and sustainable world is front-and-centre, rather than the first thing to the wall when disaster comes knocking.
News Highlights
US vs the Climate
A federal court has struck down the EPA’s suspension of an Obama-era HFC rule. They ruled that although the original rule was found to be too far reaching, the EPA went beyond their remit in revoking the rule entirely, without public input.
US emissions forecasts are plummeting, and now predict a 7.5% fall in GHG emissions this year, with the Energy Department cutting its oil output forecast by more than 1m barrels a day.
17 Republican senators have called on the Fed and the Treasury to ensure fossil fuel companies aren’t excluded from the BlackRock-administered bailout program.
Major US banks are preparing to seize and operate shale energy assets as the industry is squeezed by the oil price crash - shale companies collectively owe around $200bn to various lenders.
Cargill is joining a trial scheme that will pay US farmers for capturing carbon in soils and cutting fertiliser run-off.
The EPA is looking to slow or pause cleanup of hazardous waste sites during the current pandemic. Unlike their blanket waiver of environmental monitoring, this looks to be a more sensible case-by-case evaluation of the situation, however.
Other News
Global EV sales are expected to drop by 43% this year, fueled by the current pandemic and the oil price crash.
Germany is more than half a year behind on submitting a plan for climate and energy policies for the next decade. The plans are being held up by legislation to scrap coal power generation, which is proving tricky to finalise.
Japan has released its latest GHG estimates, showing a fall of 3.9% from the previous year, mostly due to expanded wind and solar power, along with the restarting of nuclear plants shutdown since the Fukushima disaster in 2011.
The largest solar plant in Europe has been commissioned. The 500MW facility in SW Spain was built in only a year, and will be almost immediately eclipsed by a 590MW facility due to open early next year in the same location.
South Africa is to disclose the emissions of 16 of its largest polluters. Two of the firms alone produce 40% of the country’s emissions, which are similar to the UKs, despite an economy 1/8th the size.
Airline industry bodies are lobbying to change rules for CORSIA, the new airline pollution regulation system. The system would set limits based on 2019 and 2020 baselines, but airlines are arguing that the extreme circumstances mean that 2020 should be ignored as a baseline year.
Sweden’s nuclear power is coming under increasing threat from renewables, as falling power prices make the power source less and less economically viable.
A new enzyme has been developed that can break down plastic bottles into high-quality feedstock in hours. The company behind the breakthrough hopes to commercialise the technology within 5 years.
Long Reads
The oil and gas industry is attempting to rush through the oft-delayed Keystone XL pipeline, using the current crisis as a distraction.
Despite federal Flood Insurance in the US requiring houses to be built above flood levels, nearly 250,000 policies cover homes below those levels, resulting in $1bn of claims.
The End Times
That’s all I have for you this week. As always, thanks for reading, and if you’ve any feedback or suggestions for me, I’d love to hear them (you can reach me at oli@forgethefuture.com). If you feel like sharing this, I’d massively appreciate it!
Stay safe out there, and see you next week,
Oli