TOYOTA'S global sales of gasoline-electric hybrid vehicles have surpassed 5 million in a milestone for a technology that was initially greeted with skepticism.
The Japanese automaker, which said yesterday it had sold 5.125 million hybrid vehicles as of the end of March, started selling the Prius, the world's first mass produced hybrid passenger car, in 1997. Gas-electric hybrids deliver fuel efficiency by switching back and forth between a gasoline engine and electric motor depending on speed and other driving conditions, and recharges as it travels.
"What an achievement for this technology to have grown this widespread," said Vice Chairman Takeshi Uchiyamada, known as "the father of the Prius" for having led the team that developed the hit model. "I believe there is a lot more room for this technology to grow," he said at Toyota's Tokyo office yesterday.
Toyota's hybrid vehicles now account for 14 percent of its global sales and 40 percent of its sales in Japan. Toyota sells 19 hybrid passenger car models and one plug-in hybrid, and is promising 18 new hybrids from now through December 2015.
Uchiyamada recalled that expectations had been low for the hybrid to catch on.
The production plan had called for barely 1,000 cars a month, he said, and he had to beg to raise it to that from 300 a month. But when the Prius was announced, people were flocking to dealers in Japan to place their orders. And there wasn't even a sample model to check out yet in the showrooms.
When the Prius was launched in the US, it was again met with enthusiasm, by people Uchiyamada called "opinion leaders," including Hollywood stars.
It was almost all too good to be true, he recalled, as marketing experts had warned that Americans would likely not want a car like the Prius because gas prices were then relatively low.
Since then, gas prices have skyrocketed and nations around the world are grappling with pollution and global warming.
After the March 2011 quake, tsunami and nuclear disasters in Japan, hybrids found a new use, helping deliver electricity during blackouts in disaster zones.
China is enabling developing countries to mirror its strategy of infrastructure-led development by providing the needed investment at low cost. The West has a lot to learn.
South African President Jacob Zuma’s warning to Western corporations to change their neocolonial attitudes toward Africa or risk losing out to China and other developing economies resonated powerfully last month, as South Africa hosted Brazil, Russia, India and China at the fifth BRICS summit. But Zuma’s stance reflects the rise of cross-border “macroinvestment”, a phenomenon that is more remarkable than the developing world’s declining reliance on the West.
Business investment is usually project-based, with the factory to be built or the land to be cultivated forming the investment boundary. A larger deal – for example, a concession to mine iron ore in Mongolia – would include more complex investment boundaries, establishing details like the project’s timing and the anticipated benefits to the host country.
For example, beyond building the mine itself, the deal could include investments in transport systems to market the mined product, energy generation and accommodations and other facilities for workers in the surrounding communities. In some cases, the deal might even include features aimed at boosting domestic added value by localising the mine’s procurement or creating the capacity to process the mine’s output.
The advent of macroinvestment is rendering even such extended deals obsolete. Macroinvestment involves government-to-government agreements that pre-allocate large lines of cross-border public financing. (This should not to be confused with the equity-based private investment strategy of the same name, which attempts to anticipate and profit from global trends.)
Unlike comparable financing that Western governments provide, these pre-designated lines of credit are tied to agreements concerning market or natural-resource access, and provide additional funding for the host government to invest according to its own priorities. Angola’s government, for example, arranged with China’s Exim Bank for several lines of credit totalling several billion dollars, some directly in exchange for oil, and others more broadly linked to enhancing Chinese companies’ ability to secure oil concessions.
Western commentators have largely dismissed such investment as a means for China to build vanity infrastructure, such as public administration buildings, oversized airports and underused highways. But, while such follies exist, the reality is far more interesting – and its impact far more significant.
Developing countries – and, increasingly, advanced countries as well – need massive infrastructure investment to drive their economic development. China is now enabling its developing partners to mirror its own strategy of infrastructure-led development by providing the needed investment at low cost. In these mutually beneficial macroinvestment deals, Chinese contractors deliver the needed infrastructure. Host governments receive financing not only for the agreed projects, but also to pursue other priorities that they have identified for their countries.
Shifting approach to investment governance
Critics argue that China’s macroinvestment strategy encourages rent-seeking by partner governments, providing slush funds that serve the political elite and well-connected businesses. They highlight China’s unwillingness to embrace initiatives such as the Extractive Industries Transparency Initiative, or to establish an equivalent of America’s Foreign Corrupt Practices Act or the OECD’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.
To be sure, such concerns are not unwarranted; China and its partners would benefit from robust anti-corruption legislation regulating Chinese companies’ international operations. But the critics ignore China’s promotion of national environmental and social oversight over outward investment, including the “green credit guidelines” that the China Banking Regulatory Commission issued last month, and the just-released Guidelines on Environmental Protection in Foreign Investment and Cooperation. Indeed, China is rewriting the rules for cross-border investment governance, just as it is reshaping public and private investment strategies for the twenty-first century.
Macroinvestment need not be exclusive to China, though competing against China’s unique combination of low-cost operations, abundant cheap finance, and powerful state-owned enterprises will not be easy. But, as major emerging economies like Brazil and India rapidly increase their outward investment, they are in a prime position to establish similarly constructive arrangements with developing countries.
Western countries, too, can meet growing demand for broader long-term investment deals. But they must adopt a new mindset, treating host countries as equals. Lecturing developing-country governments, while limiting investment to resource extraction, is no longer tenable.
Global investment markets are changing fast. And the cost of falling behind – erosion of long-term competitiveness – could not be higher.
Copyright: Project Syndicate, 2013.
The authorities are increasing their cloud-seeding ambitions in response to drought, but many experts are sceptical about the benefits
Airplanes loaded with cloud-seeding chemicals swept across southwest China early last month in a bid to bring rain to the drought-parched region. Tens of thousands of rockets and battalions of cannons stood poised to ambush stray clouds that might pass unwittingly into view.
By mid March a light, sporadic drizzle over Yunnan province brought welcome relief to farmers and residents struggling into a fourth consecutive year of severe drought. Local newspapers heralded the rains as the province’s first successful large scale cloud-seeding operations of the year.
This was the latest episode in China’s attempts to control the weather.
The water-starved country already has the world’s largest weather engineering programmes, and these look set to grow. In February, China’s top economic planner, the National Development and Reform Commission, announced plans to step up cloud-seeding and other weather modification techniques to tackle drought and boost agriculture.
Cloud-seeding is the oldest and most common weather modification technology, and often a resort during drought. It involves injecting clouds with frozen carbon dioxide (dry ice) or silver iodide, using military aircraft, cannons or rockets, to speed up the production of rain.
China’s bid to use cloud-seeding to guarantee blue skies during the 2008 Beijing Olympics caught global attention. But the country’s history of “rainmaking” stretches back into the distant past. Marco Polo reportedly returned to Europe from Cathay with an “explosive yellow powder” – and tales of how the Chinese used it to trigger rain, historian James R Fleming points out in his book Fixing The Sky.
Today, China spends US$100 million a year on operations to make rain, prevent hailstorms, contribute to fire fighting and counteract dust storms in almost every province.
It’s a figure expected to grow. "Weather modification technology is crucial to China," Zheng Guoguang, head of the China Meteorological Administration, told China Daily in 2012. During China's 12th Five-Year plan period "our goal is to reduce losses caused by weather disasters from 3% of GDP last year to 1% by the end of the period."
Doubts about effectiveness
China is not the only country looking for technological fixes to water scarcity. The popularity of cloud-seeding has rocketed over the past decade, as governments, companies and scientists turn to large-scale interventions in our climate systems – known as geoengineering – as a potential fix for water shortages and global warming.
In the US, cloud-seeding is used to boost rainfall during spring planting, suppress hail, increase snowpack in the Rocky Mountains and divert and weaken hurricanes. Scientists working for the Abu Dhabi government claimed to have created more than 50 rainstorms in Al Ain in July and August of 2010, the peak of summer. Indonesia recently said it had used cloud-seeding to prevent further flooding in its inundated capital Jakarta. Iraq, Yemen, India and Mexico all have their own programmes.
“Worldwide more than 40 or 50 countries are doing cloud-seeding,” says Roelof Bruintjes one of the world's leading experts on weather modification at the US National Center for Atmospheric Research who has helped many countries design and improve weather modification programmes, including China.
“With so many countries doing this, getting the science right is important.”
China’s false hopes on geoengineering
Though a prominent advocate of weather modification, Bruintjes is critical of China’s methods. Despite the wishful thinking of policymakers, cloud-seeding is “not a drought busting tool”, he says, pointing out that drought tends to mean less cloud – and without cloud, you can’t cloud-seed. Such techniques should be used as a long-term water management tool rather than a quick fix, he says.
Paul Sayers, a water expert at the University of Oxford who is advising the Chinese government on drought planning, also dismisses cloud-seeding as a solution to drought, arguing the authorities need to get a better balance between supply and demand management. “Drought plans can’t just be about infrastructure – desalination, cloud-seeding – China needs to think about drought in a more strategic way.” A start would be to find a way of prioritising water allocations during drought to avoid irreversible environmental damage, he says.
Experts are in fact sharply divided on the efficacy of cloud-seeding. The China Meteorological Administration claims its weather manipulations helped to release 490 billion tonnes of rain – about 12 times the water storage of the Three Gorges Project – between 2002 and 2012. But many are sceptical about such lofty claims, as well as China’s recent noises about more ambitious programmes.
“My first impression is that it’s very much more of a public relations effort than it might be a technically sound proposition,” says Fleming, who is professor of science, technology and society at Colby University in Maine. Being seen to do something about China’s worsening drought at least demonstrates an attempt to fix the problem, even if it achieves little.
As the world invests more in geoengineering, China is also likely to want to stay at the front of the pack, he says: “If China is becoming a world leader economically and in some ways militarily, they’re going to have to position themselves as a player in this field, even if from my point of view it’s a slight fantasy.”
Does it work?
The danger, Fleming argues, is that a focus on weather manipulation distracts from the lifestyle changes that can really make a difference to our environment. The biggest impact on the Beijing Olympics came not from the much-hyped “cocktail of artillery shell ordinance” used to bust up clouds, he says, but lower-key measures to slow down traffic into the city, which reduced hydrocarbons and helped clear the air, compounded by a “fortuitous weather pattern”.
This gets to the heart of the problem with evaluating cloud-seeding, namely the difficulty proving cause and effect. Weather is complex, shifting and difficult to understand – crediting shell fire for subsequent rain is easy enough in political rhetoric, but harder to stand up scientifically.
Some of the research that has been done strikes a sceptical tone. In 2003, the US National Research Council published a study that questioned the effectiveness of cloud-seeding and the extent of impacts outside of local areas. The report called for greater research into practices for understanding and improving cloud-seeding impacts.
To complicate things further, rising levels of pollution in the atmosphere could reduce the effectiveness of cloud-seeding, says Bruintjes. His research on inadvertent weather modification, including the effects of smoke and pollution on clouds and rainfall, suggests that what works in an unpolluted region may not in a highly polluted one.
He says more research is urgently needed in China, where the approach has been chaotic and unscientific:“They have made some claims but there is no evaluation available that can substantiate their claims," he says. China has started to invest more in upgrading technology and evaluation methods, adds Bruintjes, but results will be slow to show.
Research is costly, admits Bruintjes, but if you can get 10-15% of water out of cloud, it’s cost-effective – “five to 15 times cheaper” than any water-saving alternative, such as building reservoirs, desalination plants or water-transfer programmes.
Fears of local and regional conflict
Concerns stretch beyond efficacy and cost, however. Fleming points out that commerce is playing a driving role in weather modification. His studies of dry areas of the US show funding for rainfall enhancement is coming not from the government, but from water companies, irrigation companies and hydropower companies.
Officials in China have also talked about providing cloud-seeding as a service to the private sector. The prospect of companies paying for rain to fall in one area – potentially meaning it won’t fall somewhere else – will inevitably raise knotty questions about water rights and public access to resources.
Some commentators are also fearful that growing use of weather modification could lead to conflict both within and between states.
Its development is already closely linked with military espionage. During the Cold War, US scientists debated weather modification as one way to destroy Soviet agricultural harvests and incite internal dissent. The US military used cloud-seeding in the Vietnam War to disrupt transport of military supplies along the Ho Chi Minh, a move it's claimed triggered catastrophic flooding and widespread starvation.
James Lee, professor at the American University, Washington and author of Climate Change and Armed Conflict, has even suggested the US military is investing in cloud-seeding as an excuse for developing drones. Almost inevitably, Lee fears the widespread use of weather modification could trigger resource conflicts: “There are so many countries involved in this that I think at some time, one country is going to say to the other ‘hey, you’re stealing our rain’.”
A controversial pipeline to Canada’s oil sands has serious implications for the climate and China
The oil sands of western Canada, a barren-looking expanse in the province of Alberta, possess an enormous amount of power. Locked away in the sand and sediment is the third-largest crude oil reserve in the world, with the capacity to produce hundreds of millions of barrels of oil.
Canada’s oil sands contain the majority of the world’s remaining oil reserves that are still open to private development. The fight over what should become of its crude is a microcosm of the battle for the few remaining unclaimed energy sources in an increasingly energy-hungry world.
Environmentalists are pointing to the dangers of climate change, pipeline supporters are pointing to billions of dollars in potential profits, and neither side can believe the other one could overlook something so massive.
It’s a scene China is watching very closely – especially since it has a stake in the matter.
In February, the state-owned Chinese National Offshore Oil Co. bought the small Canadian gas and oil company Nexen for US$15.1 billion. The purchase – China’s largest-ever overseas acquisition – gives China about a 7% stake in Alberta’s oil sands, said Stephen R. Kelly, a former US diplomat to Canada who is now at Duke University.
The European Union has labeled oil from the oil sands (or tar sands, as they’re sometimes known ) as a dirty fuel, limiting its import to the EU. US reliance on foreign oil imports is declining. Yet the energy-hungry economies of China, India and other developing nations pose lucrative markets for Canada’s oil. If Alberta had the infrastructure to get its oil to the international market, Kelly said, the oil sands would be worth an additional US$20-30 billion per year.
Sometime this summer, US President Barack Obama is expected to announce his decision on the Keystone XL Pipeline Project, a 1,900-kilometre extension to an existing pipeline system that would link Alberta’s oil sands to refineries in the US.
Though opponents have also voiced concern about the possibility of oil spills along the route, Keystone’s climate change implications are at the heart of environmentalists’ opposition. A barrel of oil produced from oil sands generates 5% to 20% more emissions than a barrel produced from conventional sources, thanks to the extra energy needed to extract crude from sand.
The environmental campaigner Bill McKibben has recounted a now-famous conversation he had with James Hansen of the US National Aeronautics and Space Administration, in which he asked the climate scientist what Keystone would mean for climate change. “Essentially, it’s game over for the planet,” said Hansen. Hansen has been arrested four times for protesting construction of the pipeline, which he has called “a 1,500-mile fuse to the biggest carbon bomb on the continent.”
“The high price of oil on the international market, largely driven by an increase in demand in Asia, is the only reason why these dirty fuels are commercially viable,” said Jamie Henn, communications director for 350.org, a US campaign group founded by McKibben and others.
The pipeline could also stymie China’s development if and when the global markets begin to price carbon more aggressively, he added. “The more carbon intensive projects like Keystone XL that are approved in the developed world, the less room the developing world will have to maneuver,” Henn said.
Proponents argue that the pipeline would create jobs, cash and energy security that Canada and the US can’t afford to pass up.
Keystone isn’t the only oil sands pipeline in question. In addition to discussions over its section of Keystone, Canada is embroiled in an equally vociferous debate over the proposed Northern Gateway project, a twin pipeline system linking Alberta to shipping outlets on the coast of British Columbia.
Though the company behind the project insists it will bring the province jobs and more than US$1 billion in tax revenue, British Columbia Premier Christy Clark says she will block the pipeline unless environmental concerns are addressed.
“There is no amount of money that could make up for an environmentally unsound proposal,” she told the Canadian broadcaster CTV News.
Can anything still stop Keystone?
Obama has pledged to combat climate change in this term, as has his new Secretary of State, John Kerry, whose agency is tasked with issuing the decision on the transnational pipeline. Yet Obama also said shortly after his election that he wouldn’t put climate ahead of jobs.
In the US, there is a creeping sense that Keystone’s approval is inevitable. Earlier this month, the US Senate voted in a non-binding measure to go ahead with construction. The State Department’s environmental impact statement carried no substantial argument for why the pipeline should not be approved. A six-week public comment period on that statement ends in mid-April, after which the president will act.
If the Keystone XL pipeline is built, climate advocates will have to move their fight against dirty fuel to the places where it will be purchased.
“Here in the United States, we'll have a voice in determining the outcome of Keystone XL, but the real fate of the tar sands rests to some extent in the hands of Asian consumers, especially in countries like China,” said Henn. “Their decisions about the type of economy they want to see, and the type of planet they want to pass on to their children and grandchildren, will determine all of our fates.”
A mix of new and old technologies such as aquaponics and polytunnels are helping to make profitable city-based farming a reality in the world’s biggest cities
The hype over urban farming is catching. International media have been clamouring over the latest rooftop and trendy vertical farming projects in Beijing, London, New York and Singapore.
For cities like London, city farming represents something of a return to former times. In the 1940s, during the Second World War, the central Hyde Park was given over to growing vegetables.
In Beijing, meanwhile, it is peri-urban farming, outside the outer ring-road, that has been seen to offer the best opportunity for food production within the city limits.
However, what the latest soil-free and rooftop farming technologies present is an opportunity not only to return a level of personal or household food production to cities, but also create a viable commercial urban farming sector.
While no-one is predicting vast swaths of urban space being given over to productive agriculture – there simply isn’t enough room in densely populated cities like Beijing or Singapore – there are a growing number of examples out there pointing to a growth of urban-based agriculture over the next decade.
It just may not be the agriculture we know.
Growing food without soil
The densely populated state of Singapore has been desperately trying to increase in size since the 1960s by reclaiming land from the sea. Even with plans to expand its surface area by 7% by 2020, it is still severely land scarce.
With little spare land for agriculture, unsurprisingly, it is heavily dependent on imports, with more than 90% of its food, including six key commodities – chicken, pork, fish, eggs, rice and vegetables imported.
Enter aeroponics, which presents an opportunity to grow food in a limited amount of space. Under this farming system, plants are cultivated with their root systems suspended in the air while a nutrient solution, circulated in mist form, maintains a constant film of nutrients and moisture on the roots.
One of the world’s largest aeroponic farms has been running for more than a decade in Singapore, producing cut and bagged salads and herbs for local supermarkets – perishable products that are difficult to import.
According to local urban farming expert He Jie, professor at Nanyang Technological University in Singapore, the ability to grow vegetables without soil makes aeroponics well-suited to a dense, urban setting.
“While it isn’t possible for arable land to be expanded horizontally, an urban farming system could increase production area through vertical extensions of lightweight troughs,” she explains. “Vertical stacking is constrained by the weight of the troughs, but this could be resolved through the more lightweight aeroponic system, where stacking of lightweight troughs can offer an alternative to overcome the weight factor.”
Closed loop farming
In London, it’s a water-based system of farming known as aquaponics that is slowly gaining ground. The opening of FARM, a café and urban farm in east London back in 2010 set the ball rolling, showcasing how a tank of fish could be used to cultivate vegetables for salads.
The waste from two large tanks of tilapia fish in the cafe, fertilises vertical stacks of lettuce and other vegetables.
The company behind this installation, Aquaponics UK, has said it is getting three or four orders a month to install the system.
Twenty-something entrepreneur Kate Hofman is one of those trying to drive on the use of aquaponics. A sustainability graduate, she has recently set up a company, Grow Up, to supply and set-up aquaponic sites and is setting up a demonstration site in Bermondsey, close to central London, this summer.
To help get her project started, Kate linked up with Swiss-based Urban Farmers, a company which pioneered aquaponics in Switzerland and installed the first rooftop farm in the city of Basel.
While high-tech solutions like aquaponics and aeroponics are fascinating to document, there is also a larger but, perhaps, less glamorous urban farming sector based on more traditional techniques.
Adrienne runs Cultivate London, a social enterprise, which is farming across three sites in West London. Most of the sites are on temporary lease, typically on derelict land owned by property developers.
Operated by a team of volunteers and experienced gardeners, Adrienne expects the three sites to be able to produce 40,000 kilograms of fresh cut salads this year – a miniscule amount in the context of London’s overall food needs, but a successful demonstration of what kind of produce urban farming is likely to expand around. The three sites also produce potted flowers, herbs and vegetables, but it is the salads, chopped and bagged, that have proven the most popular and profitable product.
“I don’t think we can grow all the food London needs, but we could certainly grow all of London’s salads,” says Adrienne. “It wouldn’t require much space and it’s a high-value product that we’re currently importing from Italy and Spain, so it would make sense to grow here, if we could.”
Adrienne says being peripatetic, as well as creative with the spaces available, are both critical for aspiring urban farming enterprises. Perhaps even more necessary in Asian cities like Beijing and Hong Kong, where available derelict land seems scarcer than Europe or the US.
Urban farming goes corporate
In Beijing, recent estimates, published in chinadialogue, suggested the city has around 90 million square metres of empty rooftop space, some of which could be used for growing food.
Its harsh climate may deter many people, but early pioneers like Zhang Guichun, who has proudly shown off his 15-kilogram marrow and homemade dumplings to television crews from CCTV, have achieved celebrity status for their rooftop farms.
There are more commercial examples in Hong Kong, where Osbert Lam, owner of City Farm in Hong Kong, runs a rooftop business hiring out small garden plots to locals to grow their own fruit and vegetables. He says he was forced into a rooftop farming location because of extortionate ground rents in the city and now has 400 growing boxes on the 10,000-square-foot (930-square-metre) rooftop, available to rent for between HK$150-200 ($20-25) a month each.
The most developed commercial urban farming sector is probably in the US, where in cities like New York urban farming is already switching from a trendy activity to a corporate success story.
The Brooklyn organic rooftop farm is a 6,000 square metre farm on top of a warehouse rooftop, with views across to Manhattan island and the Empire State Building. Opened in 2009, it now supplies local restaurants, as well as selling produce through a weekly farm market.
The farm was designed and built by a company called Goode Green, which has a number of other successful rooftop farms including a vegetable farm on top of a hotel.
Jack Astbury runs a rooftop farming business on top of a supermarket in London, supplying it with fresh salad (Image by Tom Levitt)
Another company, BrightFarms, has recently struck a deal to build what it claims will be the US’s largest rooftop greenhouse in Brooklyn, producing enough vegetables to feed 5,000 people.
It says the project will help cut out the transport costs of importing produce into New York from the major vegetable-growing regions in California and the west coast of the US, as well as producing fresher crops. However, the heating costs of the greenhouse during the cold New York winters could outweigh any potential environmental savings.
In the past week, the world's largest indoor vertical farm opened in a suburb of Chicago, making use of an abandoned warehouse site to grow fresh basil and salads.
Salads, greens and high-value foods
A trend shared by the more profitable urban farms emerging in the US, as well as Europe and Asia, is the focus on growing high value, perishable crops like herbs and salads.
“If you did the maths you’d just grow salads and not even herbs,” says Jack Astbury, the head grower at Food from the Sky, which has taken over the rooftop above a supermarket store in London. “With salads we can show how fresh it is, nothing else does as well,” he explains.
In a unique partnership, food produced on the roof, with the help of volunteers, is sold the same day it is picked downstairs in the supermarket. The fresh salads are usually sold out by early afternoon, with a stream of loyal customers.
It is very much a shoestring business, with a Jack running the whole project on a part-time basis. Sales of £7,500 enabled him to work one day a week in 2012. He is aiming to push that up to £11,000 this year to cover the farm’s running costs and his wages for two days a week, although a cold start to the year has already put production behind schedule.
By restricting yourself to leafy green vegetables, Jack believes urban farming can be profitable.
“It is possible [to make a commercial urban farming business] because your customer and buyer are so close and all around you in a city,” says Jack. “The money is there to be made if you can attract the people. But I think the future is in intensive solutions that can maximise the yield in small spaces, because it’s really hard to make money when food is so cheap and city space is so expensive.”
A future of intensive and specialised urban farming models, based on soil-free hydroponic/aquaponic systems, is one that has already been predicted in a report from 2011 by Kubi Ackerman, from Columbia University's Earth Institute.
But Ackerman also points to three other important roles; utilising neglected space, educating the public on food and benefiting deprived neighbourhoods with low consumption of healthy foods. All of which could yet entice state and city governments to support a second, less commercial, urban farming sector.
Vehicle fumes are a major factor in China’s persistent smog, but experts disagree about who should foot the bill for tightening fuel standards
As large areas of China were enveloped by smog early this year, and PM2.5 levels soared off the charts, city-dwellers found themselves asking how things had got so bad.
Part of the answer can be found on the country’s congested roads.
While vice environment minister Wu Xiaoqing put the widespread smog and falling air quality down to “a combination of natural factors and human activity”, vehicle pollution, he said, was the “most prominent” cause. In 2012, the number of cars on China’s roads passed 100 million. Exhaust fumes have become a major source of urban air pollution.
Hou Yuxuan, an environmental sector analyst at investment advisor CIConsulting, said that the intensity of vehicle emissions is determined by fuel quality, the number of cars and the degree of congestion. Fuel quality in particular affects the toxicity and particulate matter content of emissions, which in turn impacts public health.
Most of China uses fuel that meets National Emission Standard III (NES III), which sets limits for carbon dioxide, nitrogen oxide, hydrocarbons and particulate matter. Cities such as Shanghai, Guangzhou and Nanjing use cleaner NES IV fuel, the next level up. Beijing alone is phasing in the stricter Beijing Emission Standard V, equivalent to the European Union’s Euro V standard, the strictest in the world.
Diesel vehicles are more of a problem, as there is a shortage of NES IV compliant diesel. NES IV was set to come into force nationwide on January 1, 2011, but has twice been delayed.
Technology used as an excuse
Anyone trying to find out why the process has been so slow will first be told about technical problems.
An engineer with one major Chinese oil company told National Business Daily that the oil firms were “feeling their way”, but faced numerous difficulties – with technical problems accounting for one third of these.
Cleaner fuel requires wholesale upgrading of equipment, technology and catalysts in use at the refineries, as well as engine upgrades for vehicles, explained an expert at the China University of Petroleum. That all takes time.
The industry is facing widespread calls for cuts in polluting fuel additives such as sulphur and manganese. Car makers also want to see less manganese used, as it damages engines. But cutting sulphur and banning manganese would reduce diesel’s octane rating, a standard measure of fuel performance. The lower the number, the more prone the fuel is to “knocking”, a malfunction where fuel burns in the engine earlier than it should, causing a series of knocking or pinging noises – something neither car makers nor drivers want to see.
However, many experts we spoke to said technology isn’t the real obstacle. It’s money.
“They’ve had clean fuel overseas for years – there aren’t any technical barriers. It’s just a matter of whether or not you want to do it,” said Li Houfeng, deputy head of the National Development and Reform Commission’s (NDRC) Energy Research Institute (ERI) and director of the National Centre for Climate Change Strategy.
Si Bin, an analyst with Long Zhong OilChem, agreed that there are no technical barriers to producing low-sulphur fuel. Back in 2007 Yanshan Petrochemical installed Szorb sulphur removal technology, enabling it to produce fuel meeting European Emission Standards IV (Euro IV), Si said. The company is now installing a second unit.
There are two reasons for the delays, according to Chen Qing, an analyst with consultancy Sci99. First, upgraded fuel pushes up production costs – costs currently borne by the refineries. In Beijing, the higher quality fuel is still being sold at old prices. This gives them little incentive to drive through improvements and so upgrades have been slow.
Second, there are concerns about the ability of drivers to cover the extra costs were they to be passed onto the consumer. Developed cities such as Beijing, Shanghai and Guangzhou have taken the lead, but the extra costs would not be so easily borne in the poorer regions of central and western China.
Si Bin added that the price of oil has gone up over the last two years, and consumers are already feeling the pain. Drivers in China tend to have mid- or low-range vehicles – they don’t want to spend money if they don’t have to. That means even companies able to produce higher standard fuel are sticking to NES III.
Who pays for better fuel?
The winter smog prompted the Chinese government to put forward a schedule for fuel upgrades.
On February 6, the State Council instructed the standards authorities to speed up publication of tougher fuel standards. The already issued NES IV standard for petrol, which allows sulphur content of no more than 50 parts per million, would be followed up by an NES IV for diesel, with the same sulphur content standard, and a transitional period running to the end of 2014.
By June 2013, an NES V for diesel would be produced, and an NES V for petrol by the end of the year, both allowing only 10 parts per million of sulphur, with transition periods up to the end of 2017.
The State Council also told refineries to speed up their own upgrades to ensure supply would be ready on time, with China National Petroleum Corporation, Sinopec and China National Offshore Oil Corporation asked to take the lead.
Refinery experts say that a fuel upgrade adds 300 yuan per tonne to sulphur-removal costs, in addition to up-front investments in equipment. Paying for that affects the producers, drivers and even the government tax take. It has been calculated that, at a conservative estimate, it will cost 50 billion yuan for the three big oil companies to make the necessary changes.
There is an urgent need to decide how to cover those costs. Experts have differing opinions, sometimes sharply opposed.
“Of course the refineries should pay,” said Xia Qing, formerly deputy head of the China Research Academy of Environmental Sciences, pointing out that the state has ruled that if their fuel isn’t up to standard, they can’t sell it.
Jiang Kejun, an ERI researcher, holds the opposite view: “You have to increase fuel prices. There’s no more to discuss.” If cleaner fuel means higher costs, better-off drivers should cover these environmental expenses, he said. If the government subsidises the costs, non-drivers are effectively paying for those who own cars. That’s unfair for the public, and particularly the poor.
“We’ve always called for higher taxes, assuming oil prices don’t change,” said Jiang. This could be used to change driving habits.
Others take a more conciliatory approach. Li Houfeng said all three parties have responsibilities they must accept – the government needs to set strict standards, companies need to implement them and consumers need to bear certain costs – while CIConsulting’s Hou Yuxuan argued it would be unfair to expect refiners to bear all the costs. Overseas experience has shown the fairest way is to divide the costs between fuel and car producers, consumers and, through reduced taxation, the state, Hou said.
Notably, some academics have said the government’s super-profits tax on the oil firms could be reduced to cover these costs and lessen the burden on drivers. The rules on this tax state that some of the income will be returned to the oil giants to account for costs incurred thanks to caps on domestic fuel prices, meaning such a move would be in line with national policy.
This article was first published in National Business Daily. Intern Yue Qi also contributed.
An international network of lawyers wants countries to commit funds to helping people forced from their homes by climate change
Villagers in the harsh landscapes of northwestern Alaska face a formidable journey. Sea ice and permafrost, the frozen subsoil that makes the land hospitable to humans, are melting. Flooding and erosion are blighting lives.
Climate change has taken on very real dimensions for these ancient coastal communities with their ancient names – Unalakleet, Golovin, Teller – where temperatures have risen twice as fast as the global average over the past half century. As government interventions have failed to ward off the elements, 12 indigenous groups have decided they want to move. More may follow.
They are not alone. From the Sahel, where women already walk up to 25 kilometres a day to collect water, to the island atoll of Majuro, set to battle increasingly regular and destructive high tides that wash away houses and flood roads, climate change is challenging the durability of people’s homes. In the long-term, many will need to adapt, or seek new lives elsewhere.
As awareness of the potential scale of climate migration grows, an international network of lawyers is seeking to draft a treaty to help secure assistance for vulnerable groups.
Operating outside the UN system, the proposed Convention for Persons Displaced by Climate Change would see richer countries agree to give money to poorer countries, either to adapt homes so that people can stay in them as long as possible or to move communities in a planned way over time. It would also establish a framework for long-term discussion on the more fraught problem of rehoming whole nations lost to the sea. Importantly, signatories to the treaty would not be asked to commit to taking people from elsewhere.
A draft treaty is expected by the end of the year, after which the team will start trying to persuade states to sign up.
Climate migration – or displacement – has drawn increasing interest in the past five years as experts have piled into the field to analyse the likely human impacts of rising sea levels, desertification, glacial lake outbursts and more. Projections of the scale of movement still vary wildly, ranging from tens of millions to the oft-quoted estimate of Oxford academic Norman Myers who puts it as high as 250 million by 2050 (or one in every 36 people on the planet). But a clearer view of the likely impacts of such human migration is slowly emerging.
While the dramatic fate awaiting Pacific island nations set to be wiped off the map as sea-levels rise has understandably seized headlines, scholars now emphasise that most displacement will happen within countries. Few people are likely to cross international borders. As a 2007 report from UNDP puts it, “The simplistic image of a coastal farmer being forced to pack up and move to a rich country is not typical.” Most of the burden will be borne locally.
That does not make it an easy problem to tackle. Conflict is expected as migration brings competition for land and water into sharper focus. Governments, disproportionately in poor countries, will have to find ways of protecting or rehousing vulnerable communities. And, for the nations that are rendered uninhabitable, whole peoples will have to find host countries willing to take them, raising a host of thorny legal questions: is an underwater country still a state, for instance? What happens to its fishing rights? And what’s the legal status of its people?
A climate migration treaty
So how can a treaty help? Australian lawyer David Hodgkinson, an aviation attorney by trade, is leading the project. The point, he says, is that climate displacement is a global issue: even if most migrants don’t cross international borders, the impacts will be transnational. “Climate change displacement in one way or another will affect every state,” he says, whether because of internal migration or because they’re being asked to cough up funds to help other countries.
Existing climate and refugee law fails adequately to provide for those displaced by global warming, says Hodgkinson. And, while “piecemeal efforts” are under way – researchers are helping Alaskan groups plan for relocation, for instance –something rather more coordinated is needed, he says. In short, the world needs to start talking.
But isn’t it already? Transferring money for adaptation from the rich to poor world already forms part of UN negotiations, and developed countries have promised to provide US$100 billion per year by 2020 for adaptation and mitigation efforts. Why start a separate conversation?
For Hodgkinson’s team, forging a specific treaty on the narrower issue of climate displacement represents an opportunity to break with stalled attempts to agree a wider deal on climate change. “We recognise that treaty making is inherently difficult, particularly with regard to climate change. But I do think one way forward is to break the problem up into pieces and somehow make it a little more manageable.”
Even if he’s right and efforts on climate displacement prove more fruitful than the UN’s more ambitious – and troubled – climate journey, there are severe challenges ahead.
First are broad human welfare issues linked to large numbers of people uprooting from long-term homes and seeking new places to live – how this can be done without impinging on other people’s territorial rights, for instance.
Then there’s the risk governments will use climate change as an excuse to move people they want to move anyway, or simply make bad judgments. In the west of China, for instance, large numbers of herders moved off the grasslands in the name of environmental protection – so-called “eco migrants” – have been stranded in cities with no livelihood or social networks, while the impact on grassland preservation has been negligible.
Hodgkinson readily admits his treaty will have limits in the face of such problems: “I’m sure that governments will make those sorts of decisions and I’m sure that in some instances climate change will be used as an excuse to achieve non-climate change related objectives. There’s no question but that there will be problems and problems that a treaty won’t be able to guard against.”
The money problem
Perhaps the biggest challenge of all, however, is funding. The developed world is already falling far short of its promises on adaptation finance, and enthusiasm for footing the bill for reinforcing foreign homes may weaken further as climate costs at home mount: Hurricane Sandy alone cost America up to US$50 billion, according to catastrophe analyst Eqecat, and extreme weather events are predicted to increase. Persuading countries to commit more than they already have will be a tough sell.
“In that regard, it’s sometimes hard not to be pessimistic generally about the climate-change problem,” says Hodgkinson. “Generally it may be that, notwithstanding the global nature of the problem, states do retreat into ever more narrow forms of self interest and, understandably enough, look after their own people. The consequences of that are understandable, but may well be quite alarming.”
One aspect of the migration conversation makes him more cheerful, however – unlike mitigation targets, CDM schemes and other more clinical aspects of the climate discussion, displacement is easy to describe and appreciate: “People can understand it, because we all have homes. Families on the move, people needing new homes – it’s a very human problem. And my experience as a lawyer has been that, when people can intuitively understand a problem, that can assist in finding solutions.”
There’s something else. Hodgkinson came to climate change through his career as an aviation lawyer, where he has seen first-hand the “intractable” knots around legislating on airplane emissions – shown most recently by the EU’s stalled attempt to include international flights in its carbon trading scheme. Dwelling for a moment on the difficulties of that sector, his voice brightens: “Gee, climate displacement might not be so difficult after all.”
Both inside and outside the ongoing Lianghui, China’s annual parliamentary season, everyone is talking about what to do about smog. Wang Tao reports.
“First, do more to clean up polluting and energy-hungry industries, like steel and power…. Seventh, limit the use of fireworks.”
Wang Deyong, boss of a printing firm, is a member of the Zhengzhou People’s Political Consultative Conference (PPCC). Six months ago he hadn’t even heard the word ‘smog’ – now he reels off seven different measures for dealing with it. He’s included those seven measures, and research into an emergency action plan for heavily polluted days, into a proposal to the PPCC.
On February 18th, 2013, his “Proposal for Dealing with Smog and Creating a More Beautiful Zhengzhou” was chosen to be the first motion to go before the 5th Plenary Session of the 12th Zhengzhou PPCC.
Ding Mingxing, director of the Zhengzhou PPCC Proposals Committee explained: “Like with the NPPCC, the proposal with the most backers becomes the first to be heard.”
Similarly, the first proposal to be heard in Hefei was also environmental in nature. A merger of three proposals, it covers a “Blue Sky Project”; dealing with pollution from coal-burning furnaces; and a crackdown on heavily-polluting vehicles.
Early in 2013, many of the local Lianghui were held during smoggy weather. Public complaints became the subject of political debate: a review of media articles found that of 31 provincial-level Lianghui’s, 23 heard motions, proposals or discussions on smog, covering all aspects of atmospheric pollution.
Air quality has been the focus of more discussion during the 2013 sessions of the local and national PPCCs than in any other year.
Chen Xiaoya, a member of the Shanghai PPCC and also of the Chinese Academy of Sciences, originally planned to submit a food safety proposal, but then opted to propose increased urban greenery to improve air quality. Wang Quanjie, a representative to the Shandong People’s Congress and a professor at Yantai University, had a proposal on a pet topic of his – disclosure of assets by leading cadres. But during the Congress “you didn’t see the sun once”, his recurrent cough came back, and all the representatives were complaining. So he and many other representatives put together another proposal on preventing atmospheric pollution.
Wang explained that this topic doesn’t affect anyone’s interests and can be talked about more freely. So he just gathered signatures for the smog proposal. As for assets disclosure: “I didn’t ask anyone else to sign, in case it caused them trouble.”
Media scrum over environment
At a Shanghai PPCC press conference the head of the city’s environmental protection bureau found himself surrounded by reporters – he was in even more demand than the transport and housing heads. “In the past,” explained a reporter, “everyone was interested in transportation and house prices.”
Wang Deyong started asking friends in the Environmental Protection Bureau about PM 2.5 pollution six months ago. Once his proposal got some attention he attended seminars with the development and reform committee, and transportation authorities. “I remember they said the city was working on a white paper, and an analysis of pollutants, but I’m no expert, I didn’t really understand.”
The representatives and members putting forward the motions and proposals come from a wide range of backgrounds, with differing levels of specialist knowledge: members of the Chinese Academy of Sciences; heads of environmental protection offices; middle school teachers; lawyers; and company bosses. Some miswrote the Chinese characters for smog, others misunderstood the Air Quality Index to be an Air Pollution Index, and even then miswrote it as “PI”.
But the content they put forward covered every aspect of the problem. Prior to 2011, submissions to the Lianghui on air pollution were highly technical. But in the autumn of that year PM 2.5 pollution came to public attention and was included in air standards, and in 2012 representatives called for monitoring and publication of air quality data data.
From 2013, 74 cities around the nation started publishing PM 2.5 data, and the number of proposals on air pollution rocketed. Wang Xiangrong, a professor at Fudan University’s Department of Environmental Science and Engineering has attended three sessions of the Shanghai PPCC, and said he has seen a distinct increase in related proposals this year.
Enforcement needed more than laws
After Beijing’s local Lianghui, businessman Pan Shiyi held a poll measuring support for a clean air law on his microblog – of more than 50,000 respondents, 98.9% were in favour. Local Lianghui participants have repeatedly proposed legislation.
Wang Quanjie believes legislation is crucial – his proposals on asset disclosure and smog both called for new laws. He thinks that lasting and standardised management requires legislation, and legislation makes later checks and limits easier. Ji Jiayu has more specific reasons – after much reading he has found that many localities are working on emergency measures for days of heavy pollution: “That response is just a part of it; legislation is at the root of dealing with the problem. You need laws, or you’re doing things backwards.”
The smog encircling China’s cities has forced progress on legislation. A consultation period on Beijing’s regulations on preventing atmospheric pollution ended in early February, with 326 responses received in 20 days. Students from Beijing 4th Middle School even submitted a 7,000 word report.
There are also calls for a revision of national legislation on air pollution. The Air Pollution Control Law was first passed in 1987, and the latest revisions have seen little progress since submission to the NPC. Wang Fengchun, head of the legislation office of the NPC’s Environment and Resources Committee, has told the media that during the 2013 Lianghui representatives were sure to call for faster action.
But Lu Zhongmei, NPC representative and expert on environmental and resource law, does not plan to make any related proposals, despite having repeatedly called for a revision to the Environmental Protection Law. She thinks that existing national law allows local governments to set targeted and implemented measures, such as taking on overall responsibility for environmental quality. “Our biggest problem is enforcement. We shouldn’t just keep on revising existing law – law you can’t enforce is just paper…”
Progress? No, not really
During the local Lianghui, Shijiazhuang might have been the nation’s most embarrassed city. In 2012, the Hebei Democratic League’s motion on improving air quality in the provincial capital was put at the top of the agenda. In January 2013, the Hebei PPCC held a press conference on the moves, at which it said that progress had been made on cleaning up the city’s air. But awkwardly, according to the new air quality standards that now include PM 2.5 levels, in January, Shijiazhuang ranked second-worst in air quality among the 74 PM 2.5-reporting cities. And of the ten worst, seven were in Hebei.
Some in Hebei complain this is unfair – as part of the important Beijing-Tianjin-Hebei region, it has to monitor PM 2.5 levels in eleven cities. Compare this with neighbour provinces Shanxi and Shandong, where only the provincial capitals and Qingdao monitor PM 2.5 levels. This is why Hebei looks so bad.
Despite the loss of face, the data still sounds a warning for the people of Hebei. The PPCC has not yet decided if it will continue to give atmospheric pollution the same priority. “The improvements aren’t that obvious, as car numbers are increasing too quickly. In 2010, Shijiazhuang had 400,000 cars, now it has 600,000,” said Feng Junsheng, one of the proposers of the original motion and deputy head of the Hebei Democratic League’s Political Participation and Discussion Department. They will follow up the 2012 motion with another on atmospheric pollution in 2013 – this time covering the entire province.
But you can’t solve air pollution overnight. On February 18, 2013, the Ministry of Environmental Protection said that it would be 2015 before a system for reducing total PM2.5 emissions in key regions would be in place.
But most members and representatives interviewed were optimistic about putting their plans into action. “It is difficult, it needs to be taken seriously. But the one child policy was difficult, wasn’t it? We did that,” said Wang Quanjie.
This article was originally published on March 1st, Southern Weekend
Recent drilling test in Northern Shaanxi Province saw local officials temporarily cut a nearby city's water supply
China has become one of Asia's leaders in expanding unconventional shale-gas extraction in the name of energy self-sufficiency and national autonomy. Experiences of “fracking” worldwide, however, suggest the costs to China of joining this revolution will be loss of control of natural resources and land to major corporations, with negative social and environmental consequences for many communities.
Rising oil prices, concerns about “peak oil” and growing public awareness of environmental depletion have made diversification of energy sources in a “sustainable” manner an urgent worldwide priority for governments and corporations.
In this context, unconventional natural gas is increasingly hailed as a triple win in terms of energy self-sufficiency, economic development and environmental benefits. Extracted through a newly applied use of hydraulic fracturing technology more commonly referred to as “fracking”, it is promoted by the gas industry as a route to lower greenhouse gas emissions – a “transition fuel” that can bridge the shift from a fossil-based economy towards a renewably powered future.
Unconventional gas exploitation has also been embraced by some governments as a solution to energy insecurity and a geopolitical “game changer”, as countries hitherto dependent on imports of fossil fuels become self-sufficient.
China’s shale gas reserves “largest in world”
China has enthusiastically joined this scramble and emerged as an Asian pioneer of unconventional shale gas production, describing it as “a ‘revolution’ to increase domestic gas supply, improve the energy mixture and protect energy security”. The government has set a target for the industry to pump 229 billion cubic feet of natural gas from underground shale formations a year by 2015; and by 2020, the nation's goal is for shale gas to provide 6% of its energy needs.
Fracking has particular appeal for Chinese policymakers, because of the size of the country’s gas reserves. A recent report by the Ministry of Land and Resources claims China holds the largest onshore shale gas reserves in the world at around 4,800 trillion cubic feet, lying mainly in the Sichuan and Tarim Basins in southern and western China. This would, it is argued, free China’s growth from a key Achille’s heel – its reliance on imported energy.
The government is also determined to support the sector’s development, because it seemingly provides a way to reduce the national carbon footprint, as 70% of the nation’s consumed energy is currently supplied by burning coal.
However, Chinese fracking “know-how” is meagre. As a result, China has encouraged energy companies China National Petroleum Corporation (CNPC), China Petroleum and Chemical Corporation (Sinopec) China National Offshore Oil Corporation (CNOOC) to form partnerships with foreign oil companies. Chesapeake Energy, ExxonMobil, BP, Chevron and Total have all embarked on multi-billion dollar deals, while Shell has announced a shale gas joint venture with CNPC to operate a 3,500 square-kilometre concession in the Sichuan Basin.
This state-foreign capital alliance notably lacks any real environmental law protection in spite of the proven risks from the US and elsewhere. The risks are directly linked to the technology and its application.
Risks of fracking
Fracking is a multi-stage process that involves drilling 3-6 kilometres below the Earth’s surface through underground freshwater sources to reach shale or coal bed formations; then drilling horizontally for up to 2 kilometres and blasting a series of fractures to create fissures to release natural gas trapped in the deep rock formations; before finally bringing the deposits up to the surface through high-pressure injection of frac fluid (water, sand and toxic chemicals) into the drilling well.
Each stage entails considerable risks. Cement-casing failures may allow methane and other hazardous chemicals to migrate to water sources and water wells. The fracking inputs contain known carcinogens and air pollutants, which can leak into ground and surface water during the fracking process. BTEX compounds such as benzene, toluene, xylene and ethylbenzene, notorious for their harmful effects on the central nervous system, have been found in hydraulic fracturing products used in the US between 2005 and 2009.
Water contamination can result from accidental spills during truck transportation, leakages through cracked or corroded cement casing of the wells, or as fugitive gas through the rock fractures themselves. Wastewater, known as “produced water”, poses serious risks. For every million gallons of chemical-laced frac fluid injected down the drill wells, 20-40％ will be regurgitated back to the surface, bringing with it: chemicals, traces of oil-laced drilling mud, and all the other toxic substances previously trapped in the rock – such as iron, chromium, salt, and radioactive materials including Radium 226.
Most water treatment facilities today are not designed to handle fracking wastewater. As a result, much of it ends up sitting in large ponds and eventually entering rivers and streams. Meanwhile, fracking can also cause earthquakes, as happened in Lancashire in the United Kingdom and Oklahoma and Arkansas in the US. (See TNI’s full briefing on fracking).
Not enough water
All of this casts doubt on the seemingly “transitional” and “cleaner” aspect of the Chinese fracking boom. The boom is most likely to breathe new life into the corporate oil industry's constant search for new avenues for profit. It certainly will undermine the Chinese people’s possibilities for democratic control of resources and their environment.
One issue in China, perhaps highlights this more than any other, and that is the way fracking will exacerbate “water grabbing”. To achieve the target of 229 billion cubic feet of shale gas will require no less than 485 million cubic feet of water. Yet, according to the same source, “most of the nation's shale gas lies in areas plagued by water shortages”. A recent drilling test operation in Northern Shaanxi Province encountered complications, forcing local officials to temporarily cut a nearby city's water supply. These risks are all the more threatening in a country that already faces major water conflicts.
China's embrace of fracking may seem attractive on the surface, but its darker consequences are already becoming obvious. Handing over power to determine how land and water is used and how the environment is managed to fracking corporations and their quest for profit is not a path to a sustainable and liveable future for China's citizens.
