With Oil This Cheap, Why Bother Going Green?

[dufus]

 

Three months ago, Ursula von der Leyen, president of the European Commission, announced — to much fanfare — a “Green Deal” to make the EU carbon neutral by 2050. Alas, a few things have happened since, including a pandemic and an oil shock. Together, these unforeseeable events cast doubt over the Green Deal just as it’s supposed to become legislation this year. The EU must ensure that the two new problems don’t exacerbate an even bigger one: climate change.

 

First the good news, such as it is. In the short term the coronavirus almost certainly reduces greenhouse gas emissions. The world’s biggest polluter, China, was the source of the outbreak and temporarily had to idle much of its industry. Many airlines are grounding their fleets, and people are also shunning other forms of travel as industry fairs and meetings are cancelled. Less kerosene and gasoline is being burned to carry people around, and less carbon dioxide is escaping into the air. But this reprieve is merely a one-off effect.

 

More important for the Green Deal is the effect of the crisis on energy costs. Less demand also means lower prices, which has strained relations between the major oil producing nations. Saudia Arabia and Russia are suddenly at each other’s throats, with the former dumping so much oil onto the global market that the crude price on Monday collapsed to its lowest level since 1991. It could stay dirt-cheap for some time.

 

Gas prices have plummeted alongside those of oil. And these two fossil fuels are now making other energy sources less competitive. That is good if gas power plants drive out even dirtier coal-fired ones. But it’s bad when, in transport or heating for example, cleaner and greener alternatives lose attraction: fuel cells, say, or electric cars charged with power from the sun or wind. In green technology, innovation and adoption tends to accelerate when fossil-fuel prices are high, and to decelerate when they’re low.

 

Now take a closer look at the EU’s Green Deal. It’s a vast and complex package of measures, but it breaks down into two conceptual parts. The bigger one consists of various forms of direct state intervention in the market — ranging from subsidies to prohibitions and coaxing — to help technologies, investments and companies that are deemed “green.”

 

These projects just got, relative to their fossil-fuel alternatives, much more expensive for taxpayers, and much more invasive and distorting for market participants. To drivers refueling at the pump or homeowners installing a heater, the market’s price signal points in one direction, while EU policy points in the other. This won’t go well.

 

The Green Deal’s other part is much more promising, especially from a liberal (meaning market-friendly, not leftist) perspective. It involves expanding and tightening the EU’s existing emissions trading system, which relies on price signals and market forces to decide where in the economy it’s cheapest and easiest to cut emissions fastest.

 

In this system, the EU fixes the total quantity of carbon that can be emitted by certain industries, from cement and steelmakers to airlines and power plants, and gives out allowances. Companies that find ways to emit less, by investing in new technologies or processes, can sell their certificates to others who need more time. As the EU notches down the overall quantity, certificates gradually become scarcer and thus dearer, giving companies even more incentive to reduce or recapture their carbon footprint.

 

But the system has two big challenges. One is that the price of allowances, even though it’s gone up recently, is still far too low, currently about 23 euros ($26.1) per metric ton. The even bigger problem is that the system at present only covers sectors responsible for less than half the EU’s total carbon footprint. Among the most glaring omissions is the entire transport sector (meaning road, rail and water, not air).

 

Fortunately, the EU now has an ideal opportunity to fix that: It should, with haste, step in to extend the emissions trading system to the petroleum industry. With crude oil prices so low, consumers at the pump wouldn’t initially feel the difference. But as the oil and Covid-19 crises recede, the carbon price would bite just as it should, changing behavior and investment decisions throughout society.

 

Europe, like other parts of the world, has several big tasks in 2020. One is to beat the virus, another is to save the economy in the process, a third is to start rescuing our climate. If the European Green Deal fails, others, from China to India, won’t even think of emulating it. The eventual fallout from the coronavirus and the oil shock would then be planetary.

 

sauce

[flash48]

Eventually the price of oil will rise, we should wisely use this time for further research.  We really do need to get the fossil-fuel alternatives more competitive.

[cosy]

It is not a matter of how cheap is oil, It is a matter of how can we reserve our world and also let the offsprings something left of what we already enjoy now.

Assuming we inherited this world we are leaving, we would be suffering from many fronts, like climate and so on.

We are living in a modern world where we think we have cars, weapons, name it.

Everyone can afford to move to any place on this planet, what wasn't so years ago.

This is the very reason we need to go or think green

[steven36]

6 hours ago, flash48 said:

Eventually the price of oil will rise, we should wisely use this time for further research.  We really do need to get the fossil-fuel alternatives more competitive.

Yes i never been green peace i could care less about the future I live one day at a time . Old saying is if you have  one foot in the  past and one foot in the future your peeing all over today  . It means live in the now . But  I'm for saving money  and in the long haul oil will skyrocket   other fuels  have already  replaced heating  in most places in the USA  . It's a whole lot more cheaper  to pay for a fixed  power bill  and run electric  heat  were i live we make electricity  with water because we have dams . One time burning K2 for heat  was like 4 times more than it use to be .  So buying a heat pump with central air and heat was the   best investment we ever made with a wood stove for back up if the power goes out.  

 

Back  in the  90s early 2000s gas was 99 cent a gallon  a lot of times.  it still  like $2.38 onetime it was up to like $4  when it goes back down to 99 cent then it's cheap again.  but even if it does it wont last.  In some liberal cities the minimum wage went way up  so it may sound cheap to some but in most places it never have went up. So still  to someone filliping burgers or on a fixed income $2.38 a gallon  is not cheap .  Electric cars being main stream  for the masses  is still a ways off  they to expensive, the price  would have to go down a lot . Right now there just luxury items for the rich.  Places that are pushing to become  fully green before the price of Electric cars  become affordable I guess  the  poor and middle class  will have to ride bicycles and horses  again .

 

You see a bunch of kids on the internet protesting for Green Peace  and they not even old enough to drive yet ,  Many of the protesters that are old enough took there car that runs on gas and air planes that run jet fuel  to the rally they a bunch of hypocrites. Right now they no protest  because they not willing to die for there cause . So if push came to shove  they would  crawl back in there hole   There mostly just all mouth .  You have to be willing to die for your beliefs are most likely  someone will come along and make you believe different  .

 

Really it's stupid   to get rid of cars that run on Gas  or K2  before  people can  afford them.   Problem with going green as much as it cost to do it would bankrupt  a country  its been  in the news about  someone running for president that's a socialist hes not going  to win the ticket  because his stupid plain even scares his own party because he will bankrupt the USA.

 

[Karlston]

53 minutes ago, steven36 said:

Old saying is if you have  one foot in the  past and one foot in the future your peeing all over today  .

 

Gold!

 

53 minutes ago, steven36 said:

Really it's stupid   to get rid of cars that run on Gas  or K2  before  people can  afford them.

 

Indeed. And an often missed point is that EV's have to be charged by electricity and will therefore increase consumption needing grid upgrades to cope. Also, premises will most likely need fitting out with high-capacity charging circuits and that costs $.

 

Governments seem to think that all that's needed to encourage EV share is to discourage petrol vehicles in some way, and all will be sweet and green. Shallow thinking IMO, very common in our rush to renewables.