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India’s coal bubble is perilously close to bursting.
This week the Indian court system handed down three landmark energy rulings. While an ultimate decision still looms, the combined weight of these initial rulings reaffirms one thing -- it’s time to diversify away from coal.
Of the three rulings, the most talked about came in response to public outrage over sweetheart deals for private mining companies that provided access to coal mine leases for next to nothing. The discovery of these backroom deals -- now referred to as the ‘coal gate’ scandal -- has rocked the Indian government, and the coal sector, for well over two years. The court’s ruling found that 218 of these leases were illegal, in a sweeping verdict that affects all mine leases issued from 1993 through 2010.
The court is set to decide whether the companies awarded these mines will be fined or whether they will lose the mines entirely on Sept. 1. Regardless, the signal the court has sent both the coal industry and the Indian government is that it is time to start over and only allocate energy resources -- like coal and coal mines -- in a transparent and fair manner. No matter how you slice it, that means increased costs.
The fallout was immediate. Most notable was the financial community’s reaction to concerns over billions of dollars that could be lost in bad loans issued to stranded assets. Indeed, with 8 percent of non-food lending exposed across the banking sector and billions invested in 37-gigawatts of new coal-fired power plants in Odisha alone, the fallout could be all too real.
The irony here runs thick. The “coal gate” scandal that birthed this verdict began under the previous Prime Minister, Manmohan Singh, and was really the epitome of all corruption scandals -- though there were quite a few.
In fact, “coal gate” has been a major issue facing the current Prime Minister, Narendra Modi. Despite bending over backwards to fast track coal projects, Modi’s administration now faces serious setbacks to advancing coal power. Thats because while the courts ruling doesn’t end coal expansion, it does potentially push the reset button -- a death knell for dozens of coal projects hanging by a financial thread. In addition, that reset will force coal miners to competitively bid for new mines which will only raise fuel prices for an already financially struggling sector.
As bad as this news for the coal industry was, it’s the second ruling from the Supreme Court that has delivered the one-two punch that may hurt the coal industry most.
While most of the country was focused on the final stages of the engrossing coal gate scandal, the court handed down a new verdict in response to pleas for a bailout from the Tata Mundra Ultra Mega Power Plant (UMPP)and other coal-fired power plants struggling with rising coal import prices. Initially, Tata low balled its construction bid in order to win the project by underestimating the price of volatile and uncertain foreign imports. But this strategy backfired as coal prices rose so high that they now threaten to make the Tata Mundra coal plant, in the words of the Tata Mundra CEO, “financially unviable.”
But rather than allow these companies to pass on the skyrocketing costs and raise rates for average citizens, the Supreme Court reversed earlier rulings deeming any retroactive changes to tariff structures a no-go. That’s incredibly important because if private developers are able to bid artificially low prices to win contracts and then retroactively change those contracts, the system as a whole is undermined. The signal this ruling sends is tremendously important because it goes right to the heart of contract sanctity in India.
More importantly, the issue of equity and fairness was at play. It’s hard to believe that billion dollar companies like Tata would have passed on fuel savings if coal prices magically dropped. Instead these energy giants were seeking to operate in a “heads I win, tails I win” situation. Thus far the Indian Supreme Court isn’t having any of it.
The fallout of this decision may ultimately be as sweeping as that of “coal gate.” It will directly affect the country’s flagship UMPPs program, a series of 4-gigawatt plants meant to stem the power crisis. Despite government and industry promises that these UMPPs will not succumb to the same dire fate as Tata Mundra and won’t be affected by the court’s revocation of mine leases, their future remains highly uncertain.
For instance, two UMPPs are currently caught up in delays over concerns related to bidding processes and the ability to pass on fuel prices in the wake of Tata Mundra. As they wait to sort out the details, delays and local opposition continue piling on costs. Meanwhile, another coal project seeking finance from the U.S. Export-Import Bank, the Tilaiya coal project, is mired in controversy and opposition from locals with over 100 Indian organizations opposing the Bank’s potential support.
In short, despite what the industry would have you believe, all is not well with coal in India.
So with this brick wall settling across the road to coal expansion, what is a power-starved nation to do? Diversify to the fastest, cheapest, and most readily available energy resource at hand -- solar.
As has been widely reported, all indications are that Prime Minister Modi takes solar power very seriously -- including a pledge to provide solar power for all by 2019. Rumors are that Modi is planning an incredibly ambitious solar target that could dwarf the already impressive 20-gigawatts of power the country has planned. That’s a reflection of the rapidly changing economics of solar in India which are on course to be cost competitive with coal as early as 2018, according to HSBC. This is a feat wind power has already achieved which is leading the nation to dramatically increase support for new wind power to the tune of 10,000-megawatts every year.
As it happens, just as the Supreme Court closed one door, another has remained wide open thanks to the Indian legal system. Solar companies were facing uncertainty over proposals to retroactively remove subsidies in Gujarat - which just so happens to be the state where the most solar has been installed to date. Here the Indian court system again upheld contract sanctity by refusing the government the ability to retroactively change contracts and subsidies for existing solar projects.
So, there you have it. Investors can certainly continue to plow billions of dollars into a sector facing a highly uncertain and increasingly costly future. Indeed many of these fossil fuel investors will be sure to keep their heads firmly grounded in the sand as their bank accounts empty, thanks to their belief in the inevitability of coal.
But for those who can see the writing on the wall, the future looks much brighter. Indeed, when it comes to future power sector investments in India, one thing is clear: all signs point to solar.
-- Justin Guay, Associate Director, International Climate Program
This week, my small town in West Virginia cut the ribbon on a solar project that isn't just the largest crowd-funded solar project in the state, but also launches a new model making it possible for any WV community organization to go solar. On a perfect sunny day, 100 elementary school students and dozens of community members joined my husband, Than Hitt, and my daughter Hazel, who cut the ribbon for a 60-panel solar system at the historic Shepherdstown Presbyterian Church. It was an unforgettable day that crystalized all our hopes for the future of West Virginia, and exemplified the power of regular people to change the world.
The genius of this project was that the church went solar for just $1, thanks to over 100 community members who contributed - but they donated their water heaters, not their dollars. Maryland-based Mosaic Power pays homeowners $100 per year to have smart meters installed on their home water heaters that save energy and, in the aggregate, operate as a safe, efficient mini-power plant. These community members are each donating their $100 per year to the church solar project, collectively raising enough money to pay for the solar system. The financing model was developed by our brilliant friend Dan Conant and his company Solar Holler, and now that we have proof of concept in Shepherdstown, he's taking it statewide.
The church is going to generate nearly half of its electricity from the sun, reducing pollution, saving money, and living out the congregation's commitment to caring for the Earth. I'm a member of this remarkable church, where we've spent many a Sunday morning lamenting the destruction polluting energy development has wreaked on our state, from mountaintop removal mining to the coal chemical spill in Charleston earlier this year.
By going solar, we’re not only reducing our reliance on dirty energy, but we've demonstrated a model that other WV nonprofits are lining up to replicate. Making this project work was a labor of love three years in the making, dating all the way back to 2011 when my family was the first in our historic town to go solar, which helped get the community talking about how we could do more. Take it from me, when you go solar, it's like creating ripples in a pond - you may set into motion changes bigger than you ever imagined.
Now that we've figured out the details of this community-supported solar financing model, Solar Holler already has two more projects on deck in West Virginia communities, and those are sure to be followed by many more. And the project is being noticed around the country, with press coverage including USA Today, the Associated Press, and this great piece by Think Progress. I'm so proud of my husband, who led this project for the church, and so proud of our community.
At the ribbon cutting, our pastor Randall Tremba offered powerful remarks that have stayed with me, because he beautifully captured why the church undertook this groundbreaking project, and what it means for the community and the nation. I'd like to close the post with an excerpt from his remarks:
These solar panels symbolically and actually reconnect this church to an old and long Presbyterian tradition of respect, reverence and connectedness for and with Mother Earth - a reverence sadly forsaken several hundred years ago. We are happy to reconnect to Mother Earth.
That old reverence is reflected in a poem composed by St. Francis in 13th century and addressed to Mother Earth, Sister Water, Brother Wind, and Sister Moon. But it begins this way: Be praised, my Lord, through all your creatures,
especially through my lord Brother Sun,
who brings the day; you give light through him.
He is beautiful and radiant in all his splendor!
Of you, Most High, Brother Sun bears your likeness.
This project will make a lot of Presbyterians, living and dead, very happy. Let me explain by taking you back through time a ways.
The Fellowship Hall is attached to the Meeting House out front which was built in 1836 by a community of Presbyterians first organized on the banks of the Potomac in 1743, which was 33 years before there was a United States of America.
These solar panels would make our 18th century founding Presbyterians very happy for, in case you didn't know, most of them were Scots and the Scots like nothing more than saving a penny. Think Andrew Mellon.
Scots love saving a penny and these panels will save us many of those.
As much as frugality, the Scots also love technological inventions. Think Alexander Graham Bell.
As much as inventions, the Scots also love the natural world and work to keep it whole and holy. Think John Muir, son of a Scottish Presbyterian minister. Love of nature is in SPC's DNA....As happy as this project makes Presbyterians, I hope it makes our civic community just as happy and proud. For this project could not have happened without ecumenical and communal support.
On behalf of SPC, I thank Than Hitt and Dan Conant along with their blue-ribbon committee who successfully guided this project through thick and thin, over humps and bumps, on sunny days and cloudy days, and around twists and turns more than once. But I also thank the citizens of this community. For it takes many hands to make light work and work light.
-- Mary Anne Hitt, Beyond Coal Campaign director
After the U.S. Export-Import Bank (Ex-Im) stated last month that it was considering financing Reliance Energy’s 3,960-megawatt Tilaiya Ultra Mega Power Plant (UMPP) and associated coal mine in the Hazaribagh district of Jharkhand, India, over 100 organizations in India signed a letter urging the the Bank to reject the coal project.
The fact that Ex-Im would consider financing Tilaiya is particularly shocking given the human rights and environmental abuses the Indian Civil Society Organizations (CSOs) uncovered at Reliance Energy’s 3,960-megawatt Sasan UMPP and associated mine. These abuses have been documented in the CSO’s report: Sasan Ultra Mega Power Project, Singrauli, Madhya Pradesh: A Brief Report.
Additionally, the Sasan coal project has been dogged by allegations of corruption, and as a result, the Supreme Court of India ordered the Central Bureau of Investigation to conduct an investigation into reported irregularities surrounding the allocation of coal blocks -- the land used for coal mining -- to Reliance. Sasan received over $900 million in financing from Ex-Im, but despite Reliance Energy’s precarious past, instead of working to prevent financing energy companies with environmental and human rights abuses, the Bank is digging in its heels and doubling down with Reliance Energy and Tilaiya.
And we’ve already seen evidence to suggest that Reliance Energy is prepared to follow the same pattern of infamous environmental and human rights abuses when it comes to Tilaiya. In 2012, more than 200 people at risk of being affected by the Tilalyia coal project were arrested for peacefully protesting at a public hearing. A week later, 20 villages in Hazaribagh decided against allowing Reliance to mine coal in their region, but Reliance pushed on, ignoring the objections of local people.
Even more vexing is the fact that Ex-Im voted last December to stop funding coal plants overseas following the announcement of President Obama’s Climate Action Plan (CAP). Prior to that plan, the Bank financed some of the largest coal plants in the world, including Sasan and South Africa’s 4800-megawatt Kusile coal-fired power plant. In total, Ex-Im has provided over $7 billion to destructive coal projects since 2007.
It’s time for Ex-Im to listen to the 109 Indian CSOs and all the communities affected by these dangerous coal projects and commit to rejecting the unnecessary, outdated coal agenda once and for all.
--Neha Mathew, Executive Coordinator, Beyond Coal Campaign
It is hard to overstate the effect that access to reliable electricity can have on people’s lives in rural communities worldwide.
That’s why we are so supportive of interventions like off-grid clean energy that not only put power directly in people’s hands, but do it in a time frame that matters: now, not decades from now. That’s something traditional grid extension and centralized power plants simply can’t do.
Despite the important leg up off-grid clean energy provides these communities, we’ve heard some concerns that these interventions can only be used to provide lighting and supplies like light bulbs. This couldn’t be further from the truth.
To help us understand what kinds of resources these companies are powering with clean energy, we turned to SunFarmer, a U.S.- and Canadian-based non-profit organization, to learn more about off-grid companies powering health clinics.
SunFarmer is a pretty unique organization. As a non-profit, they have learned important lessons all off-grid companies should live by, including not to give things away for free. That’s why SunFarmer employs a rent-to-own business model that specifically seeks to empower local companies to deliver clean energy services to hospitals and health clinics. SunFarmer’s value to these companies is simple, but big: it unlocks crucial financing. Given how hard financing is to come by in this market, that’s incredibly important.
In addition, SunFarmer provides ever critical after-sales service in the form of technical assistance, quality assurance, and system maintenance -- while local partners lead on project management. SunFarmer is also developing a monitoring and control platform to track the levels of energy production, observe the system’s battery performance, and communicate any issues (including energy theft) to health clinic staff. All of these critical data points prove that the next big frontier for these markets is data analytics.
But why should SunFarmer target large consumers, like health clinics, when most organizations working in this clean energy market start with small household needs -- including lighting and mobile phone charging?
The answer is simple: the founders of SunFarmer were moved by the negative effect unreliable power has on 300,000 healthcare facilities worldwide. These critical public health care providers suffered from hours of power shortages and cuts that were keeping them from doing their job -- saving lives.
When hospitals or health clinics lack reliable power, they can’t refrigerate vaccines. They can’t perform surgeries. Babies are delivered by flashlights or candlelight. Health clinic staff with SunFarmer projects have described the difference between delivering babies in darkness versus light, noting, “Previously, delivery was difficult using flashlights held in the mouth as they could neither see clearly nor could give instructions.”
This is particularly problematic during complicated births; as noted by the UN Sustainable Energy for All Initiative, lack of access to electricity is a leading cause of maternal mortality. Worst of all, if a medical team doesn’t have a charged cell phone, they can’t even call for extra help in an emergency situation. In short, reliable power is critical, and in the areas where these hospitals are located, the centralized grid has been failing miserably.
In Nepal, for instance, these hospitals may receive power from the grid for as little as four hours per day. Even the widely-used replacement for the unreliable grid -- diesel gen-sets -- aren’t able to keep up with the demand. That’s because the diesel fuel needed may not be delivered for days or weeks on end and may be diluted with water and other chemicals -- not to mention, its hefty price tag.
For six health clinics (and counting), SunFarmer’s Nepal staff and local partner, Gham Power, have changed this.
Funding from the SunEdison Foundation, MaRS, and crowd-funded contributions (through Indiegogo and Kiva) have allowed SunFarmer to install solar projects at six health clinics, with two more projects expected to reach completion in the next two to three months. All projects are 2-kilowatts or above and provide the reliable power the grid and diesel gen-sets have failed to supply in the past.
Currently operating in Nepal, SunFarmer plans to expand. They are raising $5 million to install solar projects at 250 more health clinics around the world.
What SunFarmer drives home is that clean energy access has far-ranging benefits -- including empowering women by making maternal health care services more readily available and assuring safe deliveries in a well-lit space.
This is why the Sierra Club’s International Program advocates for energy access. Because it’s always been about more than a light bulb, and it’s time the world woke up to what Beyond the Grid markets are capable of delivering.
-- Vrinda Manglik, Associate Campaign Representative, International Clean Energy Access
Wow. That's the word I've been repeating over and over this month, as news has rolled in of one clean energy victory after another. These are David and Goliath campaigns, led by community groups fighting for the health of their families, for clean air and water, and for a safe climate. Over and over, against all odds, from the deep South to the Oregon coast and everywhere in between, David keeps winning.
Each one of these campaigns represents a major victory for local families, who point to these coal projects as threats to the safety of their kids and communities. They also add up to a sea change in how we make electricity in America: 178 coal plants and 503 coal boilers are now slated to be phased out, and FERC just reported that 100 percent of new electricity on the U.S. grid in July was renewable, mostly wind and solar.
If you find yourself falling victim to despair or cynicism about the fate of our planet, look no further.
- Mississippi: After six years of grassroots pressure and legal challenges against the Kemper coal plant, a landmark legal settlement was announced earlier this month that will bring $15 million in energy efficiency and clean energy investments to Mississippi.
"With this agreement, we are building a future where dirty, expensive, and unnecessary projects like Kemper coal plants will be things of the past," said Louie Miller, state director of the Mississippi Sierra Club and Kemper's leading opponent over the last six years. "This agreement represents a quantum leap forward for Mississippians by creating a clear path for residents to install solar on their homes, make their own clean energy choices, and avoid huge rate hikes for unnecessary coal plants."
- Indianapolis: The city is home to a polluting downtown coal plant, long targeted by community leaders as a source of dangerous air and water pollution. After a two year campaign lead by local community groups including the NAACP, the Sierra Club, and dozens of others, Indianapolis Power & Light announced this week it will stop burning coal at its downtown Harding Street power plant.
"Harding Street is the largest single source of industrial pollution, sulfur dioxide, soot, and carbon in our city," says Megan Anderson, an Indianapolis-based organizer with the Sierra Club's Beyond Coal campaign. "This retirement marks the 500th coal boiler to be retired since the launch of the Club's Beyond Coal campaign in 2010, so we're dubbing this victory the Indy 500."
- Tennessee: The Tennessee Valley Authority (TVA) announced it will retire the Allen coal plant in Memphis, which emits thousands of tons of pollutants in the air every year. Of special note in this story is that the TVA pointed specifically to community pressure as the reason they chose to go with a smaller natural gas plant and leave room for clean energy options:TVA president Bill Johnson said TVA evaluated gas plants as large as 1,400 megawatts in their Environmental Assessment, but they went with a smaller plant in consideration of comments received urging TVA to "preserve the opportunity to use other kinds of energy resources such as solar or wind to meet future demands."
Scott Banbury, Conservation Program Coordinator for the Tennessee Chapter of the Sierra Club, says Tennesseans know that clean energy is the best choice for the Volunteer State - and they'll continue to let TVA know that.
"TVA, which is one of the nation's largest utilities, sees that coal is becoming an increasingly bad bet," said Banbury. "Clean energy technologies, like solar energy and wind power, as well as increased energy efficiency, are cheaper, cleaner and ultimately a better path forward for TVA and for Tennesseans."
- Oregon: On Monday, the Oregon Department of State Lands rejected a vital permit for Ambre Energy’s proposed Morrow Pacific coal export project along the Columbia River. The rejection is the first time a Pacific Northwest state agency formally rejected a permit for one of the proposed coal export terminals - and is a severe blow to the plan. Some are calling it a "death rattle" for the port plan!
This comes afters years of tremendous pressure from residents of all backgrounds -- from doctors, parents, people of faith, small business owners, Tribal communities, and many others.
- Illinois: In a moderate victory for Illinois activists (we're fighting for more clean energy and a solid transition for the workers), earlier this month NRG announced its plan to stop burning coal at two of its coal facilities in Romeoville and Joliet.
- Los Angeles: And in some great news for ground-breaking television, on Sunday the Showtime documentary "Years of Living Dangerously" - one episode of which featured amazing coal activist Anna Jane Joyner, TV star Ian Somerhalder, and yours truly -- won the Emmy for Best Documentary or Nonfiction Series!
What a month! I can't wait to see what the next few weeks bring.
-- Mary Anne Hitt, director of the Sierra Club Beyond Coal campaign
After a two-year campaign by 50 organizations in the Power Indy Forward Coalition, Indianapolis Power & Light (IPL) has announced its intention to stop burning coal at its downtown Harding Street power plant in 2016 and close the unlined coal ash lagoons at the plant, located on the city's south side.
"Harding Street is the largest single source of industrial pollution, sulfur dioxide, soot, and carbon in our city," says Megan Anderson, an Indianapolis-based organizer with the Sierra Club's Beyond Coal campaign. (That's Anderson at center, below, delivering petitions to IPL headquarters in 2012.) "This retirement marks the 500th coal boiler to be retired since the launch of the Club's Beyond Coal campaign in 2010, so we're dubbing this victory the Indy 500."
[Note: Coal plants are made up of one or more boilers, or "units" -- Harding Street has three. With the Aug. 21 announcement that TVA's Allen plant in Memphis will be retired, the Beyond Coal campaign has helped retire 178 coal plants and 503 boilers since the campaign launched in 2010.]
A long-standing tradition at the Indianapolis 500 car race is for the victor to drink a bottle of milk immediately after the race. Below, local volunteers toast the Harding Street victory in downtown Indy.
IPL's August 15 announcement came as the Indianapolis City-County Council was preparing to vote on a resolution urging IPL to stop burning coal at Harding Street by 2020. Resolution 241, which also urged IPL to invest in greater amounts of clean, renewable energy, had 11 co-sponsors, and a majority of council members had pledged to vote yes.
The measure passed the Community Affairs Committee 4-1 last month, with supporters of the resolution vastly outnumbering opponents at the hearing. Hours earlier, the Sierra Club released a poll showing that nearly 7 in 10 Indianapolis voters supported IPL phasing out coal entirely in Marion County, and for the utility to increase its energy efficiency and use of renewable energy like wind and solar.
Among those who testified at the July hearing was Amber Sparks, below in tan jacket, who lives about three miles from the Harding Street plant. She told the City-County Council how asthma-related illnesses have regularly kept her children home from school, led to about 20 emergency room visits and half a dozen intensive care stays, and thousands of dollars in medical bills.
"Asthma has changed our lives," she said. "We continue to adjust and eliminate as many triggers as possible … but there are some triggers I can't control. On bad air days, the children must stay indoors, limit physical activities, and have round-the-clock breathing treatments. Their quality of life is affected, and it breaks my heart each time they look at me and ask why they have asthma."
Below, clean-air activists at the hearing.
According to the EPA, Harding Street was responsible for 88 percent of the toxic industrial pollution released in 2012 in Marion County. It is also the largest source of dangerous soot and sulfur dioxide pollution in the county, contributing to central Indiana's failing grades for air quality announced earlier this year by the American Lung Association.
Photo courtesy of NUVO News
Over 55 churches, neighborhood associations, student groups, and other organizations comprising the Power Indy Forward Coalition passed resolutions urging IPL to power our city with clean energy and put an end to toxic pollution in Indianapolis. Hoosier Chapter volunteers knocked on doors, talked to people at festivals and on the street, made phone calls, and spoke out at rallies and public hearings about the public health impacts of burning coal.
Above and below, clean-energy activists celebrate IPL's August 15 announcement.
"For the past two years, thousands of Indianapolis residents have demanded clean air for our community," says Jodi Perras, Indiana representative for Beyond Coal. "They've signed petitions and postcards, rallied on the steps of Monument Circle (above) and at the Indiana State Museum, and urged their City-County Councilors to call on IPL to stop burning coal at Harding Street. Today, those calls have been answered."
There may be a light at the end of the long dark tunnel: It appears China’s coal boom is over.
While positive signs have been emerging from China for well over a year, it appears the ‘war on pollution’ is not just talk. According to analysis produced by Lauri Myllyvirta and Greenpeace International in the first half of this year, China’s coal use dropped for the first time this century - while the country’s gross domestic product (GDP) actually grew.
You read that right: coal and GDP growth have decoupled in China.
At the same time, the growth of imports -- the seemingly endless source of optimism for the moribund U.S. coal industry -- ground almost to a halt, with only 0.9 percent growth so far this year, as opposed to more than 15 percent yearly figures we have seen since China first became a net importer. Topping off the trifecta of good news is that domestic production dropped by 1.8 percent [article is in Chinese]. While uncertainty over the changes in coal stockpiles still exists, we’re confident that the unbelievable may be at hand: peak coal consumption in China.
It’s hard to understate just how historic this shift is. Analysts have been arguing over if, and when, Chinese coal consumption would peak. Some were forecasting a peak before 2020 while others -- including Wood Mackenzie -- have been loudly claiming Chinese coal demand may not ever peak but would instead double by 2030. This new data exposes the wide gulf between reality and hype that those predictions rely on.
In a sign of just how dramatically the tables have turned on the previously skyrocketing projections for the coal industry in China, consider this: the China National Coal Association is now calling for a 10 percent reduction in second half domestic coal output in many of the main coal-producing provinces. That about face comes as quite a shock considering as recently as December, the Association was busy advocating for a billion tonnes of coal to be added to the Chinese coal market by 2020. My what a difference a year makes.
But, it’s important to understand how the many who still believe in the myth that Chinese coal demand can grow endlessly will respond to the news. Two easy to believe short-term explanations have already been offered for the slowing coal demand.
The first is that China’s economic growth is slowing and skyrocketing coal consumption will resume when the economy rebounds. The problem with this explanation is that while the first five years of the century saw coal use and GDP grow almost hand in hand, the second half saw them decouple. More importantly, the Chinese economy registered a year-on-year growth rate of 7.4 percent, which indicates that the fundamental growth pattern of the Chinese economy has changed.A widening gap between economic growth and coal consumption increases. Sources: Compiled from China National Bureau of Statistics and China National Coal Association statistical releases.
The second explanation was offered by Bloomberg: a surge in hydropower generation offset coal use. China did indeed add a lot of hydropower capacity in the first half of 2014; however, the 9.7 percent year-on-year increase in hydropower generation was business-as-usual. In fact, the average for the past five years was 9.3 percent. This increase in hydropower was only capable of changing the coal consumption growth rate by less than one percentage point, which hardly changes the big picture.
So, what’s really going on? The times they are a changing, and the Chinese economy is changing with them. We’re finally starting to see movement away from the energy-intensive fossil fuel industries and investments that fueled China’s rise.Basic energy-intensive industry products are no more the engine of growth in China. Source: Compiled from China National Bureau of Statistics yearbooks and press releases.
It has been long acknowledged that, in China, investments and a heavy reliance on industry cannot sustain growth while the services sector and household consumption remain suppressed. This adjustment seems to be slowly progressing, with growth in services (excluding real estate) and private consumption only recently outpacing the manufacturing industry. While still nascent, if this restructuring gains pace, along with the promising growth in clean energy, there is much reason for optimism.
But there is still a long way to go from a peak in coal consumption to the necessary reductions needed to move toward a clean energy future. Fortunately, this change does not have to be linear, and interestingly, it seems Chinese investors were ahead of the curve as many have been busy shifting their money from coal to clean energy over the past few years.
It looks like the smart money in China has long realized what the data is now showing: bullish predictions on future coal growth are unfounded, and clean energy is the future.
-- Justin Guay, Associate Director, International Climate Program, and Lauri Myllyvirta, Greenpeace International
The BMW i3 made its debut in U.S. markets in May. The best way to describe the car is that it's radically different. It really looks like a concept car; its design is futuristic and colorful, with the added bonus that you can actually buy it today. The i3, though dead silent, has impressed with a 22kwh battery that has a range of 81+ miles between electric charges and can take you from 0-60 in under 7 seconds.
"It takes off like a rocket!" says i3 owner Charlie Rabie, a Tufts University professor and former business leader, who took delivery of the first i3 in the U.S. [Check out the Sierra Club's electric vehicle guide.]
So what's all the fuss about?
We met with Rabie to discuss the car. He explained why he found himself drawn to it. "[The car] is flawless… it drives like a BMW…I don't have to deal with gas stations. The car had been built from the ground up to be electric, and it shows."
Rabie went on to show us some of the innovative functionality that is available to smartphone users through the i3's own app. You can remotely view charge levels, check historical efficiency stats, lock and unlock your doors, start and stop charging, precondition the battery's temperature for optimal efficiency, and even see how many pounds of CO2 you've avoided releasing into the atmosphere.
Additionally, BMW seems to have come up with a solution to the range anxiety issue experienced by some. My dad, who also happens to be an i3 owner, decided to go for the Range Extended (REX) model. The REX version comes with a small gasoline engine that effectively doubles the car's range, kicking in only when the battery is about to drop below 5 percent.
The fact of the matter is that the range extender is a foolproof safety net; it doesn't just double your mileage range; it gives you total freedom to drive i3 to its full electric range every time you charge it. Most times, you'll drive in only electric mode. But if you happen to run out of electric charge, you can rely on gasoline and even fuel up at a gas station if you don't have access to or time for EV charging. However, all the i3 drivers I've spoken to, including my dad, say that the vast majority of the miles they're driving are electric.
"I've driven 6,000 miles, 95 percent of that was on electricity, and I've never gotten stuck " said my dad, Jack Mark. "For a city, it's the ideal size. And it's so quiet, my wife and I can sit and chat as if we are in our living room."
The Sierra Club's New Hampshire chapter chair Jerry Curran is another i3 driver. He also adores his new wheels and recently gushed:
"The i3 is the most advanced electric car in America in terms of sustainability. To reduce energy consumption, it was built with light weight carbon fiber and aluminum... The carbon fiber was produced in Washington with Bonneville hydro power. The assembly plant in Germany is powered by three wind turbines. Recycled materials comprise half of the interior. It's a blast to drive, handles like a BMW, and will drop any other BMW muscle car off the line from 0 to 45."
- Joe Mark, an incoming senior at Tufts University, is an intern with the Sierra Club's Electric Vehicle Initiative.
If you’re one of the 29 million Americans that can’t wait to tune in to this week’s Shark Week spectacular, you’re probably familiar with the incredible power, grace, and agility of the world’s 460-plus species of sharks.
For the past 27 years, audiences have been captivated by the annual week-long tribute to the world’s majestic aquatic predators. But what you might not realize is that sharks are in serious danger.
In fact, tens of millions of sharks are mercilessly killed each year. More than 160 species of sharks are categorized as at risk of extinction, ranging from near threatened to critically endangered. But what’s the biggest threat to these crucial and magnificent creatures? Shark finning.
Shark finning is the increasingly rampant and highly profitable process of stripping sharks of their fins and throwing the sharks back into the ocean, very much alive but unable to swim. This leaves the helpless sharks at risk of bleeding to death or becoming prey for another predator. Shark fins -- the most profitable part of a shark -- are then traded in a billion-dollar annual market. For centuries, shark fins have been mainly used in the wildly expensive shark fin soup, a delicacy in some countries.
Importantly, some countries are beginning to take action to stop shark finning. The U.S., for example, has already banned shark finning, and eight U.S. states and three U.S. territories have passed bans outlawing the possession, sale, trade, and consumption of shark fins. And, thanks to the recent campaign by former basketball star Yao Ming, shark fin soup has been on the decline in China. In fact, shark fin trading has dropped by as much as 82 percent in some parts of the country and continues to decline.
While this is a step in the right direction to protect sharks, it’s not enough. We need strong action and common-sense policies to stop shark finning and associated trade around the world. Unfortunately, a massive trade agreement currently under negotiation between the United States and 11 other Pacific Rim countries seems to leave shark fins on the chopping block.
In fact, many of the 12 Pacific Rim countries negotiating the secretive trade pact -- Malaysia, Vietnam, and Singapore, to name a few -- have a long and bloody history in the shark fin trade. That’s why it is particularly worrying that a previously leaked chapter of the TPP includes only very vague references to shark finning -- not the full ban on shark finning and associated trade that we need. Other parts of the TPP would allow corporations to sue governments over environmental safeguards—like protections for sharks—that might decrease their profits. This could mean a huge step backward in the fight to protect sharks.
Luckily, there’s a way to protect the sharks -- and you can help. Some Members of Congress want to “fast track” the TPP by simply voting yes or no to pass the deal -- without taking the time to debate or amend it. We must tell our Members of Congress to oppose fast track in order to prevent a harmful TPP that threatens communities, our environment, and sharks. So while you’re watching prime time shark action this week, take action to tell your Member of Congress that the U.S. can’t be a part of any trade deal that puts our sharks at risk.
We know we need to protect our oceans’ top predator. It’s time the U.S. led the way.
--Ilana Solomon, Director, Sierra Club’s Responsible Trade Program
Last summer, President Obama delivered a major climate speech in which he laid out his plan to reduce greenhouse gas emissions by 17 percent by 2020. He also committed to deciding the fate of the Keystone XL pipeline based on it climate impacts, stating unequivocally: "The net effects of the pipeline’s impact on our climate will be absolutely critical to determining whether this project is allowed to go forward."
While the evidence (PDF) shows that Keystone XL would result in significant greenhouse gas emissions and should be denied in its own right, it is only one of many proposed tar sands pipelines on the Obama administration’s desk. The State Department is currently preparing an environmental impact statement (EIS) for an expansion of Enbridge's Alberta Clipper pipeline, which would increase its capacity to over 800,000 barrels per day (bpd) - roughly the same size as Keystone XL. An expansion of Enbridge's Line 3 would transport up to 760,000 bpd of tar sands crude through the Great Lakes region; and a reversal of the Portland-Montreal Pipeline could bring up to 600,000 bpd through New England.
Because the tar sands deposits are landlocked in Alberta, the oil industry needs these pipelines to carry tar sands crude to U.S. refineries and overseas markets. Each one is a key part of the industry's plan to triple tar sands development to around six million bpd by 2030. Without these pipelines, much of the high-carbon tar sands would stay in the ground.
Last week, the Sierra Club and allies urged (PDF) the State Department to evaluate the cumulative climate impacts of these pipelines as part of its Alberta Clipper EIS. The National Environmental Policy Act (NEPA) requires an analysis of the cumulative environmental impacts of a proposed project combined with other past, present, and reasonably foreseeable projects. Federal courts recognize that "the impact of greenhouse gas emissions on climate change is precisely the kind of cumulative impacts analysis that NEPA requires."
In a recent decision, a court rejected federal agencies' attempts to downplay the climate impacts of permitting a coal mine based on the reasoning that other coal would be mined and burned regardless of their decision.
The State Department now has two major tar sands pipelines pending before it -- Alberta Clipper and Keystone XL -- and several more on the horizon. Yet so far, it has narrowly analyzed each pipeline in isolation without looking at their cumulative effect on tar sands expansion and the corresponding greenhouse gas emissions. For example, the State Department’s EIS for Keystone XL claimed that the approval of any one pipeline project is unlikely to have significant climate impacts because other tar sands pipelines are sure to be built in the future, allowing unchecked tar sands expansion in any scenario. State relied on this same flawed logic to approve the original Alberta Clipper tar sands pipeline and the first Keystone pipeline.
The State Department cannot keep claiming that tar sands pipelines are inevitable when it has the authority to approve or reject each pipeline. Looking at each project in isolation ignores the bigger picture—the State Department’s series of decisions on individual pipelines will cumulatively have massive climate implications.
The Sierra Club and its allies are not alone in calling for a broader look expanded tar sands infrastructure. Last month, a coalition of leading scientists published an article in the journal Nature that called for a moratorium on tar sands pipelines and an end the "tyranny of incremental decisions" that has already allowed tar sands production to double in the last decade. As the scientists explained, the "current public debate about oil-sands development focuses on individual pipeline decisions... When judged in isolation, the costs, benefits and consequences of a particular oil-sands proposal may be deemed acceptable…[b]ut impacts mount with multiple projects...." A narrow view of each individual project "creates the misguided idea that oil-sands expansion is inevitable." Instead, the scientists thus urged leaders to pause, and craft a broader energy strategy under which “decisions on infrastructure projects…are made in the context of an overarching commitment to limit carbon emissions."
In preparing its EIS for the Alberta Clipper expansion, the State Department has an obligation to analyze the project's cumulative climate impacts in the context of Keystone XL and other past and future tar sands pipelines. As the scientists caution: "Anything less demonstrates flawed policies and failed leadership. With such high stakes, our nations and the world cannot afford a series of ad hoc, fragmented decisions."
-- Doug Hayes, Sierra Club Staff Attorney
But that’s exactly what Dr. Jim Yong Kim, president of the World Bank, did this week during the U.S.-Africa Leaders Summit. Dr. Kim disparaged clean energy as incapable of powering development and even worse, suggested coal needed to remain on the table for the World Bank to be “taken seriously.”
The truth is clean energy is the future of energy access efforts with a $12 billion pot of gold awaiting those innovative enough to catalyze it. Even more exciting is that much like cell phones, distributed clean energy is poised to leapfrog the ineffective centralized grid and put power in the hands of the people living beyond the grid today - not decades from now. But that’s only if leaders of important development institutions -- like the World Bank -- finance the clean energy technology of the future, rather than prop up the dirty industries of the past.
Dr. Kim’s statements are even more troubling because they come at a time when we are making great strides to do just that. President Obama’s Power Africa Initiative presented a historic Beyond the Grid program set to catalyze new technologies -- like off-grid distributed solar -- which will end energy poverty.
But rather than moving investment into these exciting and innovative clean energy markets, Dr. Kim is insisting that one of the world’s largest international financial institutions, the World Bank, can’t be taken seriously unless it continues to fund dirty and dangerous coal projects. And, he wants to use public money -- your money -- to do it.
Tell Dr. Kim and the World Bank to join us in the 21st century and put money into catalyzing beyond the grid solar, not dirty coal. It’s time that those who lead development institutions realize the only way to be taken seriously is to move beyond 19th century energy sources to our modern energy future.
--Justin Guay, Associate Director, Sierra Club's International Climate Program
This week marks the six month anniversary of the Dan River coal ash spill in North Carolina. In February 2014, a broken pipe released up to 82,000 gallons of toxic coal ash and wastewater into the Dan River. The cleanup still continues today as Duke Energy drags its feet.
But if you think that sort of coal ash water contamination happens only once in a blue moon, you'd be wrong. Coal ash contains arsenic, lead, mercury, and selenium, as well as aluminum, barium, boron, and chlorine. Coal ash waste is stored in more than 1,400 sites in 45 states -- and just this week coal ash waste was found buried beneath a softball field at a middle school in Brunswick County, North Carolina.
From the article:
"It wasn't documented, because back then it wasn't deemed hazardous waste," said Stephen Miley, Brunswick County Schools' director of operations.
Well guess what - coal ash still isn't deemed hazardous waste despite its toxic contents. For that matter, it isn't subject to any national protections at all! There simply aren't any federal standards to govern how to safely dispose of coal ash, to keep it out of our streams, rivers, lakes, and drinking water. That's right – no Environmental Protection Agency safeguards for toxic coal ash. And yet, according to the EPA, coal ash has already contaminated waters at 200 sites in 37 states across the country.
Every year, the nation's coal plants produce 140 million tons of coal ash pollution, the second biggest waste stream in the country, after household garbage.
All that ash has to go somewhere, and because we don't have any federal standards to guide safe disposal, much of it is dumped in the backyards of power plants across the nation, into open-air pits and flimsy surface waste ponds -- and sometimes it ends up stashed under softball fields where kids play, or used in the construction of golf courses, or dumped into an old quarry. Monitoring these sites is left up to the states, and in the absence of federal standards, most states lack either the resources or the will to do the job.
Coal ash doesn't just pose a threat to water – it pollutes our air, too. Our friends at EarthJustice just released this new report entitled "Ash in Lungs: How Breathing Coal Ash is Hazardous to Your Health." Here is one shocking quote from the report release:
How long will we let this happen? The EPA must finalize strong coal ash standards this year to protect our health and ensure that we have clean air and water. It shouldn't take a massive spill, water contamination, or billowing dark clouds of coal ash dust to convince the agency to make this happen, despite opposition from the coal industry. Let the Dan River spill be our last coal ash spill – we don't need any more wakeup calls to tell us that now is the time for EPA coal ash safeguards that will protect our health.
What will it take? It will take all of us working together, raising our voices, and keeping the pressure on, until strong, long overdue national coal ash protections are in place.
TAKE ACTION: Tell the EPA to finalize strong coal ash standards. And while you're at it, tell your state legislators to demand action from the EPA as well.
-- Mary Anne Hitt, director of the Sierra Club Beyond Coal campaign
Hundreds of concerned residents from port communities along the Gulf Coast packed an Environmental Protection Agency hearing in Houston this week to call for stronger pollution controls near oil refineries.
"In Louisiana and Texas, communities around refineries have for too long lived with exposure without knowing what was in the air," said Darryl Malek-Wiley, a Sierra Club environmental justice organizer in Louisiana.
The EPA is proposing additional pollution control requirements for storage tanks, flares, and coking units at petroleum refineries. The EPA is also proposing to require monitoring of air concentrations at the fenceline of refinery facilities to ensure proposed standards are being met and that neighboring communities are not being exposed to unintended emissions.
Exposure to toxic air pollutants can cause respiratory problems and other serious health issues, and can increase the risk of developing cancer.
The Sierra Club, EarthJustice and coalition partners helped bus in residents from neighborhoods near refineries in Louisiana to speak at the Houston hearing. Affected residents from around the U.S. were also at the hearing to testity. From the AP story:
"The fenceline monitoring will help us determine what is coming out of those stacks," she said.
Adan Vazquez said that in winter, "snow flurries look like ash" because of a refinery near the Houston Ship Channel less than a mile from his Pasadena, Texas, home.
Leslie Fields, director of the Environmental Justice and Community Partnerships program for the Sierra Club, testified at the hearing as well, calling on EPA to create the strongest standard possible and enforce it. This EPA standard at refineries would reduce toxic emissions, improving air quality and protecting public health in communities surrounding these facilities.
"We support the proposed standard -- it's long overdue for these affected communities," said Fields. "We also are advocating for real time fenceline monitoring and more hearings in the Midwest and along the East Coast on this standard," said Fields. "The EPA also needs to create an environmental justice analysis for this rule."
But Fields and Malek-Wiley also think the standard could go even farther.
"The EPA needs to look at more chemicals from these refineries, require more monitoring, and we also want to make sure that all that information is easily accessible to communities," said Malek-Wiley.
"Also, some have said it's too expensive for industry. Well, for one example, I looked at the first quarter of 2014, and Marathon Oil made $540 million. If they don't have enough money now, when will they ever have enough money to do comprehensive real-time monitoring of their pollution?"
(L to R) Mary Willams of the Deep South Center for Environmental Justice, Jane Williams of Sierra Club California, Monique Harden of Advocates for Environmental Human Rights, Jesse Marquez of the Coalition for Safe Environment, Lisa Garcia of Earthjustice, Hilton Kelley, Leslie Fields, Margie Richard, Dr. Robert Bullard.
Also testifying at this week's hearing in Houston were 2011 Goldman Environmental Prize winner and long-time Port Arthur environmental justice activist Hilton Kelley and Dr. Robert Bullard, the winner of the 2013 Sierra Club John Muir Award and known as the father of environmental justice. Dr. Bullard is the dean of the Barbara Jordan-Mickey Leland Public Policy School at Texas Southern University.
Powerful testimony also came from Dr. Beverly Wright, director Deep South Center for Environmental Justice at Dillard University in New Orleans, Willy Fontenot, the conservation chair of the Delta Chapter Sierra Club in Baton Rouge, Neil Carman, Clean Air Director of the Lone Star chapter, Jane Williams, chair of the Sierra Club Toxics Committee, 2004 Goldman Environmental Prize winner Margie Richard, and Dorothy Felix of Mossville Environmental Action Now in Louisiana.
TAKE ACTION: Tell the EPA you want strong pollution standards and enforcement for oil refineries!
California leads the nation in solar energy generation. But while most of California continues moving the clean energy transition forward, the Port of Long Beach has taken a huge step backwards, promoting the interests and protecting the wallets of the toxic fossil fuel industry.
In a controversial agreement that ignited community outcry, the Port of Long Beach recently approved a new lease to raise the amount of guaranteed coal exports, as well as to continue the Port’s petroleum coke exports (or petcoke, a byproduct of oil refining). The plan, which will have devastating consequences for local and overseas communities, secures dirty fossil fuel exports for the next 15 years.
The Port's agreement violates key provisions of the California Environmental Quality Act (CEQA) that require proper environmental impact analysis and disclosure for projects. Under this state law, the Port is required to gather public insight and provide vital information to decision-makers before approving projects or agreements with detrimental consequences.
Additionally, CEQA mandates that all assessed impacts are met with measures to mitigate harmful impacts. The Port did not conduct any environmental review at all in this case and it claimed that its decision to approve the lease agreements was exempt from CEQA. This claim is especially problematic because the leases deal with increasing the exports of two of the most polluting fossil fuels--coal and petcoke--both of which have air, water, and climate change impacts.
The Port's failure to meet these statewide environmental safeguards prompted the Sierra Club to take action and join with Communities for a Better Environment, Natural Resources Defense Council, and Earthjustice to file an appeal to contest the Port's new approvals. The appeal, submitted to the Long Beach City Council on June 23, was filed to enforce state law requiring an adequate environmental analysis under CEQA.
The agreements approved by the Port include a partnership with Oxbow Company, a corporation that falls under the Koch brothers' big-polluting empire. The plan will bring coal shipments from mines in Utah and Colorado and potentially the Powder River Basin in Wyoming and Montana to the California coast on trains passing through several communities.
The Port's regressive action quickly garnered backlash from local community members, who voiced concerns about community health and environmental impacts from coal dust blowing from the exposed rail cars at a Port of Long Beach Board of Harbor Commissioners' meeting in June.
Californians aren't just worried about the local impacts of this destructive new agreement from the Port of Long Beach -- they have also raised concerns about the ramifications for global climate disruption. The Port's agreement to export fossil fuels will serve Long Beach's temporary economic interests at the extreme expense of overseas communities that are importing the American coal but are without emission controls.
"The Port's neighbors in Long Beach are moving towards clean energy, and Los Angeles plans to be coal-free by 2025 -- yet the Port still wants to embrace the past and ship carbon-intensive coal and petcoke in the middle of our clean energy transition," said Sierra Club attorney Jessica Yarnall Loarie. "Long Beach should put the health and safety of its communities first: we don't want to burn coal here, and we don't want to ship our dirty fossil fuels somewhere else."
The Port's move and long-term agreement contradicts both the U.S.' and the state of California's commitments to move away from dirty fuels such as coal. From mine to rail and port to plant, communities across the West Coast are standing up against fossil fuel exports.
It's time for the Port of Long Beach to listen to the voices of local residents. And with action like the Environmental Protection Agency's new Clean Power Plan and the Oakland City Council's resolution opposing the transportation of dangerous fossil fuels by rail in California, clean energy future is clearly on the national and statewide agenda; the Port of Long Beach is taking a step into the past.
Not only does the Port agreement violate the law, but it also violates our commitment to cleaner air, healthier communities, and a global effort to combat climate disruption. Help protect the communities impacted by this dangerous agreement by signing this petition here to tell the Port of Long Beach to put families first and reconsider their decision.
-- Stephanie Steinbrecher, Sierra Club. Photos by Al Sattler.
I've been struck by Pepsi’s "Live for Now" advertising theme. "Now" is good, but I keep wondering: what about tomorrow? PepsiCo, which owns Pepsi, Gatorade, Quaker Oats, Frito-Lay, and dozens of other brands, is one of the largest companies in the world and has a tremendous impact on people and the planet. For example, the company uses toxic tar sands fuel in its massive fleet of delivery trucks. By "living for now," is the company saying it could care less about tomorrow?
I know we can expect more from PepsiCo. Why? I've met the CEO, Indra Nooyi.
I had the opportunity to meet Nooyi at the PepsiCo shareholder meeting in June when I was there to speak on behalf of the tens of thousands of people who had signed a petition urging the company to stop using fuel made from tar sands in its trucks. Before the meeting started, Nooyi and I connected over the fact that both of us are mothers to two daughters. As mothers, both of us want the best for our kids.
During the meeting, when Nooyi responded to my remarks in front of the shareholders and board of directors, she emphasized that because she has two daughters, and I have two daughters, we share the same values and commitment to the future.
Recently, dozens of major organizations signed a letter to companies like PepsiCo urging them to avoid tar sands fuel because it's "among the most environmentally-destructive sources of oil on the planet in terms of climate and water pollution, forest destruction, public health impacts, and the destruction of ancestral First Nations lands."
In a letter in PepsiCo's 2012 Sustainability Report, Nooyi says: "Business does not operate in a vacuum -- it operates under a license from society. We recognized…when we transform our business to deliver for our consumers [and] protect our environment...we achieve sustained value."
Companies like Walgreens, Trader Joe's, and many others have committed to working with their fuel and transportation providers to avoid tar sands fuel. Why hasn't PepsiCo made this commitment?
Given that we connected over our children and the future we're leaving them, I'm making this appeal directly to Indra Nooyi:
For our daughters, for all of today's and tomorrow's children, please commit your company to clean up its delivery trucks, which make up one of the largest private carrier fleets in North America with tens of thousands of vehicles driving millions of miles each year. You can make a major difference by having PepsiCo avoid tar sands fuel, an extreme source of oil that is destroying forests, poisoning water, and hastening climate change.
Oil makes up about 40 percent of U.S. carbon emissions, so reducing oil consumption is essential if we're going to have any possibility of avoiding the worst effects of climate change. Please also ensure that PepsiCo invests in more than just a few hundred electric vehicles, so that it can take a serious swipe at its oil use.
Today, Sierra Club is asking people (like you, dear readers!) to show Indra Nooyi and PepsiCo's other executives who we’re living for -- now and for tomorrow: children who deserve a safe planet with clean air and water and no extreme and dangerous fuels.
Do you have children, grandchildren, nieces, nephews, or other kids in your life? Upload their photos here like I just did (those are my daughters on the first day of school last fall). We're hoping each picture is worth a thousand words, and that the full collage shows Indra Nooyi that we're rooting for her to commit PepsiCo to tomorrow.
-- Gina Coplon-Newfield is director of the Sierra Club's Future Fleet & Electric Vehicles Initiative
All eyes will be on the U.S.-Africa Leaders Summit in Washington next week with one question in mind -- will those gathered take steps to move investment beyond the grid?
Just this week, Politico reported that former New York City Mayor Michael Bloomberg and former President Clinton are set to attend. With a long list of U.S. Government dignitaries also expected, the event will send an important signal for the future of President Obama’s Power Africa Initiative. Now’s the time for that signal to be loud and clear - Power Africa is doubling down on investment in solar markets beyond the grid.
Earlier this summer, Energy Secretary Ernest Moniz announced at an event in Addis Ababa Ethiopia, a groundbreaking new $1 billion initiative as a part of Power Africa dubbed “Beyond the Grid.” The initiative builds on more than 25 small-scale energy projects already in the Power Africa pipeline to catalyze a distributed clean energy deployment. To build the initiative and drum up investment, the Administration pulled together 27 founding partners – including impact investors, venture philanthropists, clean-energy enterprises, and practitioners – who have committed to invest over $1 billion over the next five years to seed and scale distributed energy solutions for millions of African homes, businesses, schools, and other public facilities.
That announcement was a big deal. By shifting policy focus and investment towards the cheapest, fastest, most effective energy access solutions - distributed off-grid solar - the Obama administration is poised to unlock between a $12 billion and $50 billion clean energy opportunity.
Underneath those numbers lies an even more exciting idea -- that energy access can develop just like communications have. All across the developing world -- but especially in Africa -- mobile phone technology has leapfrogged land line telephones entirely. In fact, three out of every four new mobile phone subscribers are now in the developing world. The same cannot be said of energy access.
Research from Group Speciale Mobile Association (GSMA) shows how both energy and water access lag far behind the penetration of cell phones in Africa. In total, 411 million people worldwide, the vast majority in sub-Saharan Africa, have a mobile phone but no way to charge it. It’s this convergence of un-electrified populations and mobile phones that is creating a tremendous new opportunity for solar power.
All across Africa, solar entrepreneurs are working with communities who live beyond the grid to put power directly into their hands. Thanks to the explosion of cell phones, these communities are now able to take advantage of mobile money platforms like M-Pesa in Kenya to pay for solar energy from companies like M-Kopa. This is unlocking a solar revolution for energy poverty that could fundamentally alter the evolution of energy infrastructure across the continent.
But while this market is growing rapidly -- 77 percent in 2014 according to the Global Off Grid Lighting Association -- it’s cash-starved and needs support. That’s why the industry has been demanding a new $500 million fund from the World Bank (join them and sign our petition). Here are a few steps the summit can take to further back this vital industry:
1) Announce a goal to phase out kerosene based lighting by replacing it with clean solar power;
2) Leverage investments in solar that help achieve that goal by using loan guarantee authority at USAID or OPIC;
3) Work to reduce and eliminate harmful VAT taxes on solar products for the off-grid rural populations; and
4) Set a baseline and measure progress in increasing public investment in beyond the grid solar markets.
The President’s new Power Africa Initiative and the Energize Africa Act in Congress both touch on these important goals. That’s why they now represent historic opportunities to shift resources and investment beyond a failing business-as-usual approach towards 21st century solutions. As the world’s biggest leaders come to town for the U.S.-Africa Leaders Summit, the innovative companies and investors building a future we all want to see will be waiting to hear one message: It’s time to move investment Beyond the Grid.
-- Justin Guay, Associate Director Sierra Club’s International Climate Program
When it comes to energy access, we’re fond of saying small is big.
That’s because all those small scale solar lanterns, solar home systems, and solar mini-grids add up to a very big market. But the size of that market, and its social impact, could well be dwarfed by an even larger opportunity the solar revolution is engendering. With the explosion of mobile money platforms, and the pay-as-you-go (PAYG) solar financing options they enable, companies working Beyond the Grid are collecting reams and reams of data that could provide rural communities with perhaps the most transformative intervention yet -- financial inclusion.
It’s important to first take a step back and understand just how profoundly important financial inclusion is for these off-grid rural communities. For many populations living beyond the grid, they are also living beyond the reach of the formal economy and the financial system. That means they can’t take out loans for productive uses (say a sewing machine to make clothes and generate extra income) that could improve their lives, which in turn restricts their ability to move up the economic ladder and reinforces the poverty trap.
But it doesn’t have to be this way. Rural communities already pay tremendous amounts for heavily polluting sources of energy -- nearly $40 billion for kerosene lighting. Solar entreprenuers are redirecting those cash flows to cheaper, cleaner sources of energy saving them money and improving their quality of life. But more importantly, by paying off these products, they are demonstrating the people’s ability to pay, and therefore their creditworthiness.
Photo courtesy of Angaza
But there is a wide gulf between being creditworthy in principle and creditworthy in practice. That’s because the financial institutions that would be granting loans to these people need historical data on which to judge risk (this is the same dilemma that faces solar providers in the U.S. as they try to securitize loans). That is where we reach a classic Catch-22: without credit history you can’t get credit, and if you can’t get credit, you can’t build credit history.
Enter mobile money, PAYG finance, and distributed solar. Companies are now leveraging machine to machine (M2M) technology -- where mobile phones ‘talk’ to solar panels -- to allow customers to pay for solar power when they need it and, more importantly, when they can afford it. This allows the software providers to capture the first-ever multi year credit data for these populations and ultimately make billions of people visible to the formal economy for the very first time.
Photo courtesy of Angaza
To understand what this looks like in practice, take Angaza Design, a company working beyond the grid specializing in PAYG platforms, at the bleeding edge of this opportunity.
Angaza was incorporated back in 2010 and began its operations, as nearly all solar companies do, by selling solar lanterns. Founder Lesley Marincola quickly realized that, while their products were great, Angaza was just one amongst literally hundreds of solar lantern start ups. They simply weren’t going to move the needle on this problem by just adding another product to an already crowded field. So, like all good entrepreneurs, Lesley pivoted and found a niche; Angaza is now all about data.
Currently, Angaza manages a cloud-based PAYG software platform called the Energy Hub, which integrates directly with mobile money platforms (like M-Pesa) and provides a suite of online services to help distributors manage and streamline PAYG financing of solar energy systems. They also work directly with manufacturers to develop custom PAYG hardware solutions that are optimized for the features of their existing product line. These products then become “PAYG-ready”, which allows them to communicate with the Energy Hub and activate/deactivate depending on the customer’s payment status. This complete PAYG ecosystem enables Angaza to provide holistic support of PAYG financing -- and collect lots and lots of data.
How they use this data is, of course, the most powerful component.
For example, let’s say that one of Angaza’s clients needs a microfinance company to lend them money for a sewing machine so they can make clothes from home and earn some extra income. The client can turn to Angaza and ask the company to release their solar repayment information, which can then help the client secure a loan they otherwise wouldn’t be able to procure.
Having this data available allows a previously unbanked customer with no known payment streams to get a record, not to mention a proof of address, which can both unlock other financial services. Similarly, Cignifi is doing the same type of work by using big data credit analytics to score unbanked people by using each client’s prepaid phone records.
Even more interesting is the direction Angaza is headed -- down the economic pyramid. While most companies are rightly focused on moving populations up the energy ladder, Angaza is working to go even deeper into the economic strata by using finance to unlock solar for those most in need. That means focusing on making even entry level solar lanterns available by using extremely low cost PAYG solutions.
In so doing, Angaza is literally building credit profiles from the bottom up with an eye towards moving those customers up the energy ladder from lanterns to solar home systems and beyond.
While this is only the beginning, Angaza’s business model holds profound implications for transforming the lives of billions of people with individual hopes, dreams, and desires. This data can help break down the anonymity and exclusion poor populations face while painting a vibrant picture of the aspirations these people hold.
But like any tool, it is dependent on how we use it. By leveraging its power, companies like Angaza are using it to eliminate energy poverty and financial exclusion once and for all. A mission we should all support.
--Justin Guay, Associate Director, Sierra Club International Climate Program
Last September, thousands of Bangladeshis joined the five day “Long March” from the capital city, Dhaka, to the city of Rampal to protest a proposed new coal-fired power plant. Now you can join the walk in a new documentary, “Long Live Sundarban,” available on YouTube.
The proposed coal project threatens the Sundarbans -- a UNESCO World Heritage Site which translates to “beautiful forest” in Bengali -- home to the largest reserve for endangered Bengal Tigers. It is also the world’s largest mangrove forest and plays an important role in the local economy and agriculture. More importantly though, the Sundarbans are a critical natural defense against cyclones, and it is estimated that every time one of these powerful storms hits Bangladesh, the forest saves hundreds of thousands of lives.
And the danger from these cyclones will only increase. At less than 20 feet above sea level, Bangladesh is one of the most vulnerable nations to the effects of climate disruption. As sea levels rise and storms worsen, the country will need the Sundarbans more than ever.
But this could all change if the proposal from India’s state owned National Thermal Power Corporation (NTPC) and Bangladesh’s Power Development Board (PDB) to build this proposed 1,320-megawatt coal-fired power plant moves forward. This coal project will not only contribute to the climate disruption threatening Bangladesh, it will also endanger their main protection against it.
But local activists are working hard to make sure this doesn’t happen.
“This proposed power plant at Rampal is hazardous in terms of economy, in terms of national equity, in terms of protection and utilization of national resource and in terms of public health,” Pinaki Bhattacharya, a teacher of environmental toxicology at AIUB, said in the documentary.
“If this consciousness develops, if people realize that this coal-fired power plant will bring disaster, they will definitely be active and government must be forced to abstain from this,” Shahed Kayes, a poet and social activist, added in his commentary in the documentary.
The massive turnout for the Long March shows that these efforts to win over the public are paying off.
Bangladesh is already demonstrating that there is a way forward without coal. There are over 80,000 new solar system installations each month in Bangladesh, and this growing clean energy industry offers an innovative solution to energy poverty while protecting the resources the people of Bangladesh rely on.
It’s time for NTPC and PDB to support this clean energy revolution and stop putting Bangladesh at risk from the ever-increasing effects of climate disruption. Until then, the thousands of activists who joined the Long March and countless others across the country will work to protect the Sundarbans.
As Shyamoly Shill, an assistant professor of sociology at Jagannath University, explains in the documentary, “Sundarbans is the integral part of the whole nature and ecosystem of Bangladesh. We have no way but to fight for conservation of Sundarbans.”
--Nicole Ghio, Sierra Club International Climate Program
As thousands rally this week in support of the EPA’s proposed Clean Power Plan, one thing is clear – people across the country are united in their demand for cleaner air to breathe. It’s fitting then that the final hearing starts in Pittsburgh on Thursday, an area that suffers from some of the worse air quality in the nation.
Every summer more than 53,000 children in the Pittsburgh region suffering from asthma are told to stay inside on bad air days because playing outside is a risk to their health. Summer is especially difficult for these kids and other vulnerable people -- including seniors and people with respiratory disease -- because the hotter temperatures lead to more smog, one of the most dangerous forms of air pollution.
Climate disruption is making this problem even worse with more hot days, longer heat waves and higher temperatures. That means even more smog.
The Sierra Club made this connection in the radio ad posted above that was launched this week in the Pittsburgh region, declaring that it’s time we did something to clean up our air. And that something is support the Clean Power Plan.
Coal-fired power plants, like those that dot Southwest Pennsylvania, are one of the primary sources of both smog-causing nitrogen oxides, soot and the carbon pollution that’s fueling climate disruption. In fact, while most of these plants could cut their pollution right now, they simply choose not to, putting our kids at greater risk.
But when the coal industry heard our ad, they did what they do best -- deny and smear. An industry group called the American Coalition for Clean Coal Electricity issued a press release claiming carbon pollution has nothing to do with public health, thereby again putting polluters soundly on the opposite side of science and reality.
If big polluters are denying reality and abdicating responsibility for wreaking havoc on our public health, it must be a day that ends with a “y”. Check a scientific study, big coal: carbon pollution from burning coal worsens smog which triggers asthma attacks. That's part of why the Clean Power Plan's curbs on carbon are expected to prevent 150,000 asthma attacks in children.
But Americans shouldn't expect big polluters, the same companies that have been dumping toxins into our air and water for years, to care about public health. That's why we are doing our best to cut through their smears with these latest ads.
--Kim Teplitzky, Sierra Club Media Team, Pittsburgh, PA
As the U.S. Environmental Protection Agency (EPA) holds public hearings across the country on the proposed Clean Power Plan, national polling continues to show strong support for climate action. And a new survey released by Green For All and conducted by the firm Brilliant Corners suggests that the desire for government action to combat climate disruption is especially high among minority communities. In fact, three quarters of voters of color surveyed said that they have become more interested in climate issues over the past several years and are paying closer attention to new information.
The survey, which was conducted in nine battleground states and surveyed registered voters of color including African Americans, Latinos, and Asian Americans, found that many voters of color feel climate disruption is a prominent issue that cannot and will not wait for action in the distant future. Almost seven in ten voters said they feel it is an issue "we need to be worried about right now, not something we can put off into the future," with another 62 percent saying that the country is not devoting enough to combating climate disruption. When asked to rank the importance of climate disruption on a scale from zero to 10, the average response was 7.9.
"People of color care deeply about the environment and the impacts of climate change. We understand the urgency of addressing these threats because we experience the effects every single day," Nikki Silvestri, executive director of Green For All, said in a statement. "We have an obligation to one another to make sure that everybody enjoys a healthy planet."
Looking ahead to November, this survey suggests that political candidates who advocate for climate action will have an advantage among voters of color. An overwhelming 70 percent of voters surveyed said they would be more likely to support political candidates who are willing to expand resources to tackle climate disruption and grow new industries over a candidate who argues that climate action will cost jobs and hurt the economy. After all, many voters of color think that climate action is a moral imperative. When asked what the most important reason to support the EPA's proposed carbon pollution standards, the most common reason was that the rule would be fulfilling a moral duty to our children in the future.
-- Christopher Todaro, Sierra Club Polling and Research Intern