Here’s a link to the article in the Daily Mail.

See you soon!

This is the stuff that dreams are made of, as Sam Spade would say. So deliciously moist it almost sticks to the roof of your mouth, divinely dense but not heavy, the cake is quite simply sublime.  Several months ago, I had a hankering for it and found an excellent recipe online, from the blog of a fellow former Yalie and baking lover. Though I’m quite thankful for the recipe, I’ve altered it a tad it for my own tastes and European ingredients: you can find my version here.

Though I would go on to try many lovely cakes while at Yale, from Claire’s, other nearby restaurants from New Haven’s stellar dining scene, as well as from relatively nearby New York City, I wouldn’t say that any of these experiences were formative to my interest in the matter. However, my first summer in Europe would change that.

This report, commissioned by the Coalition Government, aims to explore how Britain can better support and accelerate the private sector investment required to deliver the UK’s transition to a low carbon economy. An independent and non-partisan advisory group brought together by the Chancellor of the Exchequer has consulted widely with experts in government, business, policy and finance to identify the barriers that are constraining investment. They have developed proposals for a Green Investment Bank (GIB) that could help to remove these barriers and rapidly increase investment in the low carbon infrastructure and technologies that Britain needs. This report sets out the challenges facing the UK’s transition to a low carbon economy, the market failures and barriers to investment, and the case for intervention to address them. Read the report…

A new OECD analysis, using data from the International Energy Agency, suggests that ending fossil fuel subsidies could cut global greenhouse gas emissions by 10% from the levels they would otherwise reach in 2050 under ‘business as usual’, and highlights the business sense of doing so as governments strive to cut budget deficits. IEA estimations indicate that subsidies to fossil fuel consumption in emerging developing countries amounted to US$ 557 billion in 2008. Estimates for developed countries are harder to obtain as they are often transferred in indirect ways. Subsidies include preferential tax treatment for oil and gas production, special loan guarantees, and tax exemptions for fuel use in some sectors or to some consumer groups. Many subsidies are inefficient in achieving their intended objectives of supporting the poor in countries without adequate social security systems, often serving to benefit the rich rather than the poor. Whilst reforming fossil fuel subsidies is politically challenging, key lessons can be drawn from experiences in countries like Poland, France and UK, who have successfully introduced coal production subsidy reform. Read the full OECD press release…

A new report, ‘Environmental Impacts of Consumption and Production: Priority Products and Materials’, produced by the International Panel for Sustainable Resource Management’ calls for dramatic changes to the energy and agriculture sectors in order to generate significant environmental, social and economic returns. The report highlights that much of this reform can start at the level of the household, such as through improvements in household patterns of energy and food use including heating and cooling systems, gadgets and appliances and people’s travel behaviours. Achin Steiner, UN Under-Secretary General and Executive Director of the UN Environment Programme, highlights that ‘smart market mechanisms, more intelligent fiscal policies and creative policy-making are among the options for internalising the costs of unsustainable patterns. Some tough choices are signalled in this report, but it may prove even more challenging for everyone if the current paths continue into the coming decades’. Read the press release…

In a new forecast, Deutsche Bank has indicated that the price of carbon is likely to reach €15-16 per tonne by mid-2010, though will likely decrease slightly in the short-term because industrial installations still have many allowances to sell as the economic downturn continues to keep emissions down. The predicted increase in price is likely to occur as utilities begin to buy phase-two allowances in advance to cover their emissions in 2013 until EU countries begin to auction phase-three allowances in late 2011.

Point Carbon has highlighted that the total value of the global carbon market held steady at €94bn last year, compared with €92bn in 2008, despite previous predictions that it may contract by a third. The EU’s emission trading scheme continued to dominate, accounting for over three quarters of global value and two thirds of global volume. Read the press release…

This article highlights a new study by AirClim, T&E and EEB which calculates that NOx emissions from ships in European waters are forecast to grow by nearly 40% between 2000 and 2020, but that a charge on nitrogen oxide emissions from ships of about €470 per tonne could cut emissions in the Baltic Sea by nearly 60% annually. Proceeds from the tax could then be used to finance NOx-reduction projects in the shipping sector. The study analyses the efficacy of economic instruments including emissions trading and differentiated fairway and port dues, drawing on the Baltic Sea as a case study. The proposed tax was inspired by Norway’s levy on NOx emissions. Read the report…

EU governments and MEPs have reached an agreement on plans to revise the 2002 directive on the energy performance of buildings in order to ensure that all new buildings constructed after 2020 will consume ‘near-zero-energy’ i.e. they will have ‘a very high energy performance’, and any energy used will come ‘to a very large extent’ from renewable sources generated either on-site or nearby. Public authorities are expected to lead the way by setting an example in their own buildings. There was also consensus on a new EU-wide methodology for setting national efficiency requirements on building components such as roofs and windows, but the exact details will be agreed later through the EU’s comitology procedure. MEPs were less successful in their efforts to force governments to upgrade the efficiency of existing buildings, in the end reaching agreement only to ‘develop policies and take measures such as targets’ to transform existing buildings into near-zero-energy buildings when they are refurbished. MEPs also failed to secure new cash to fund efficiency improvements in existing buildings. Governments will therefore have to produce a list of measures and instruments to support the law’s implementation, and by 2011 the European Commission must say whether additional EU funding is needed. Read the European Parliament press release…

This article highlights the potential role of energy efficiency improvements in addressing the UK’s energy ‘trilemma’; the need to replace existing generating capacity with an energy source that is affordable, reliable and low-carbon. It quotes MP Malcolm Wicks’ comment that energy efficiency is not a ‘soft’ option, but represents a ‘rigorous and vigorous action programme to reduce substantially the country’s demand for energy’. It also conveys National Energy Action’s calls for the government to initiate a comprehensive retrofit of the existing UK housing stock, and to better coordinate existing government schemes that are of relevance to the issue e.g. Act on CO2 and Warm Front. In particular, the article emphasises the value of smart meters, both for highlighting to the public exactly how much energy they are consuming and for putting an end to estimated bills and thereby enabling the delivery of better-targeted assistance to those struggling to pay their energy bills. Read the article…

Lord Smith of Finsbury, the Chairman of the Environment Agency, has suggested that rationing is the fairest and most effective way of meeting Britain’s legally binding targets for cutting greenhouse gas emissions. Each person would have a ‘carbon account’ and a unique number that they would submit when making purchases of carbon intensive items such as petrol, electricity or airline tickets, and would then receive statements showing the carbon weight of each purchase and how much of their ration remained. Those that used up their ration within a year would have to buy extra credits from those who had not used their full allowance. It was argued that this system would be fairer than carbon taxation because of the risk that carbon taxes would make certain activities, such as flying, too expensive for people on low incomes. Read the article…

This article highlights the Welsh Assembly Government’s announcement of plans to introduce a 15p charge on plastic bags from early 2011, with all revenues to be used on environmental projects. Shops will be responsible for collecting the cash and spending it on green campaigns. It is hoped this will encourage more shoppers to take reusable bags to supermarkets. Welsh Environment Minister, Jane Davidson, said ‘carrier bags represent a waste of resources and they are an iconic symbol of the throwaway society we now seem to live in’. The British Retail Consortium has argued that customers should be encouraged to change, and not ‘clobbered’ with new ‘taxes’. Read the article…

The International Energy Agency has emphasised that, whilst Spain has significantly improved its energy policy in recent years, it must ‘substantially’ increase its efforts to reduce carbon dioxide emissions in the electricity and transport sectors. Given over half of Spain’s electricity currently comes from fossil fuels, the IEA suggest they should continue to eliminate coal (and other fossil fuel) subsidies, and could reduce the transport sector’s CO2 emissions through revenue-neutral taxation. Public works minister, José Blanco, initially confirmed plans to introduce a carbon tax, following similar plans drawn up by France and Ireland. Read the IEA press release…

Following this article, a subsequent article highlights an announcement made by the economic ministry that the Spanish government actually has no plans to introduce a tax on carbon dioxide, neither in the 2010 budget nor in a forthcoming law on sustainable economy, though he did confirm that the law will include green fiscal incentives.

Leaders at the G20 summit in Pittsburgh also agreed to a phase-out of fossil fuel subsidies in the ‘mid-term’ in order to fight climate change. A draft summit statement highlighted that ‘inefficient fossil fuel subsidies encourage wasteful consumption, distort markets, impede investment in clean energy sources and undermine efforts to deal with climate change’. Visit the US government’s G20 energy summit website…

This article describes Price Charles’ campaign to create state-of-the-art green homes built from natural materials – such as clay, hemp and sheep’s wool – which would be available to social housing tenants. Building work on the Natural House started in April and is due to be completed shortly. With construction costs at approximately £100000, and fuel bills expected to be half that of traditional homes, the property is being promoted as a realistic option for social housing. Once completed, the home is expected to achieve a four-star rating under the government’s Code for Sustainable Homes and only takes 12 weeks to build. It is one of nine properties constructed and tested at the Innovation Park in Hertfordshire, which is also home to the Renewable House. Read the article…

Biodiesel producer ‘Plantanol’ launched a legal challenge against German authorities after it was asked to pay an energy tax in 2007. Tax breaks for biofuel producers were originally adopted under the 2003 biofuels directive, but the Darmstadt Customs Office said taxes were due on the 50-60% vegetable oil content of Plantanol’s biodiesel, following an amendment to Germany’s energy tax law. Last week, the European Court of Justice agreed that this decision in 2006 to scrap tax breaks for most types of biofuels in Germany does not breach EU laws on biofuels and energy taxation. Read the judgement…

The UK government has published its low-carbon white paper, setting out a ‘transition plan’ for reducing the country’s greenhouse gas emissions by 34% by 2020 compared to 1990 levels. The plan suggests that a target to generate 40% of electricity from low-carbon sources by the end of the next decade will deliver around half of the required annual emissions cuts to 2020. Around 30% of this generating capacity will come from renewables, with nuclear and clean coal accounting for the other 10%. Published alongside this plan is the Renewable Energy Strategy, which sets a goal of generating 12% of heat from renewables by 2020. Expansion of the Renewables Obligation and the introduction of new feed-in tariffs will provide around €35bn in financial support for renewables. In addition, a separate low-carbon transport plan sets out measures to reduce emissions from domestic transport by 14% by the same date.

Read the DECC press release… 

The plan has received mixed media coverage.

The Daily Mail held the headline ‘the £92 green stealth tax – family fuel bills will soar to fund the fight against climate change’ and highlighted evidence that the true cost to householders could be as high as £230 a year. It quotes Consumer Focus in saying that ‘Government steps to tackle climate change are essential, but consumers shouldn’t have to write a blank cheque to pay for this. The cost should be shared with Government and industry, who will also benefit from these measures’.

The Financial Times highlights the plans for ‘a shake-up in energy regulation’ as Ofgem is given a new remit to focus on consumer protection and carbon reduction as well as competition in energy markets and new powers to meet its objectives. The article also mentions the risks of the rising energy costs for people on low incomes, quoting Jenny Saunders from National Energy Action who, whilst welcoming the new social tariff, is ‘concerned at the timeframes involved and the potential narrowing of assistance to pensioner households when millions of low income families are also in fuel poverty and need access to lower tariffs and protection from rising prices’. An article in the Guardian also discusses the NEA’s criticisms, together with disappointment expressed by renewables companies in the proposed renewable energy tariff levels.

Also in the Guardian, George Monbiot writes ‘the ink isn’t dry on the government’s low carbon transition plan, and already the whingeing has begun’. He acknowledges the significant challenges associated with energy prices and fuel poverty but writes that, realistically, the government’s new plans will make no appreciable difference to current fuel poverty rates. The rate by which the wholesale price of gas rose between 2003 and 2006 was 160 times greater than the rate of increase in retail fuel prices likely to be caused by the government’s climate change programmes. He attempts to make clear that the fuel poverty and the climate change programme have very little to do with each other, except in as much as the government intends to help the public to insulate their homes. Instead he points out that what is lacking is a government policy to make contingency plans for the possibility that global supplies of oil (and presumably gas) will one day peak.

This article explores the arguments for and against the price (e.g. carbon taxes) vs quantity (e.g. cap-and-trade) approaches to reducing greenhouse gas emissions. So long as scientists lack the sufficient level of certainty about exactly what level of pollution will trigger climate disaster, the price mechanism may have the advantage; at least price targets can provide certainty about how much money will be spent. Setting a price target, however, carries the risk that the price will be wrong. The article concludes that in reality the ‘ultimate test of any system is its design’, whether based on price, quantity or a combination of the two. Read the article…

In this article, Reuters’ columnist Matthew Goldstein queries both the Republican opposition to and Obama’s support of the idea of carbon trading. He suggests that, whilst the Republicans would be expected to back such a ‘classic Wall Street-driven solution’, Obama’s administration would more likely oppose any scheme that will ‘fatten the wallets of Wall Street traders’. He wonders why Obama does not show more support for a carbon tax, which ‘would get the job done without the kind of wealth transfer to the gilded class that Republicans generally support’. Read the article…

Beijing has joined in the growing level of protest about US plans for a carbon tax on imports from countries without their own emissions reductions commitments. This follows the passage of a cap-and-trade bill in the US House of Representatives, which has yet to move to the Senate. Yao Jian, spokesman for China’s ministry of commerce, said ‘it has always been China’s position that the international society should fight climate change together, but the proposal of some developed countries to slap a carbon tariff on some imported products violates the WTO’s basic principles and is trade protectionism in the disguise of environmental protection’. Mr Yao also emphasised that it could ‘severely harm developing countries’ interests’. Read the article…

Interestingly the report is positive about the acceptability of border measures to level the playing field between firms subject to national carbon or energy taxes and importing firms subject to less stringent environmental regimes.

The  report provides clarification on the conditions under which border tax adjustments may be compatible with trade rules and therefore opens some interesting areas for further development which previously appeared to be stalled in policy terms. The Green Fiscal Commission will be publishing a briefing paper on Border Tax Adjustments later in the year as a contribution to this debate on the issue, which may perhaps now be reinvigorated following this WTO/UNEP contribution.