European Union carbon prices hit record lows this week after the European Parliament voted down an emergency plan to boost the ailing EU carbon trading market. The vote was over whether to remove 900 million carbon permits from trading between now and 2015, to an attempt to address the oversupply of these permits and drive up their value. Following the vote EU carbon permits plunged 43% to €2.63 ($3.44) a metric ton. In the past five years, carbon prices in Europe have plummeted nearly 90%. Businesses applauded the decision which spares them facing increasing costs for pollution permits, but environmental groups decried it as a fatal vote that undermines Europe’s credibility in fighting climate change.

The crumbling price of carbon in Europe is putting pressure on the UK.  The UK has its own carbon pricing scheme but, unlike Europe, it has a floor price which is currently set at £16 ($24.30) per tonne. The UK’s high carbon price floor represents a threat to competitiveness for British companies, particularly in energy-intensive sectors, and several companies are threatening to move their operations out of the country to where there is a lower or no carbon tax.

In light of the EU carbon tax vote, Australia says it will revisit its own carbon tax to see if changes should be made.  The price of carbon Downunder is currently fixed at $23 Australian per tonne and is scheduled to rise incrementally over the next two years before linking with the European scheme in 2015 when it will be determined by competitive markets. Several Australian commentators, depressed by the events in Europe, are now hoping that China will implement a more meaningful carbon tax that Australia can link with.

Taiwan’s fourth nuclear power plant is nearly operational.

Iraq has raised its estimated proven crude oil reserves to 150 billion barrels from 143 billion barrels, with more oil discovered in oil fields being upgraded by international oil companies and from a new oil field in southern Iraq.

The Iraqi oil ministry is planning to auction the giant Nassiriya oil field in southern Iraq on December 19, a senior ministry official said. A total of 52 international oil companies would be able to take part in the bidding round for the integrated project–developing a $4.4 billion oil field and building a 300,000 barrel-a-day refinery nearby.

PBF Energy Inc., the largest producer of Bakken crude oil in the US state of North Dakota, will now deliver oil to an East Coast refinery by rail.

Spain announced it will ban natural gas production from hydraulic fracturing in one of the most promising shale gas regions in the country. Spain joins France and Bulgaria as European countries who have banned the use of this new drilling technology used to access unconventional sources of gas.

The International Energy Agency said that coal-fired generation grew by 45% between 2000 and 2010, far outpacing the 25% growth in non-fossil fuel generation over the same period. A revolution in shale gas technology has triggered a switch from coal to cleaner natural gas in the US. Elsewhere, however, coal use has soared, particularly in Europe, where its share of the power generation mix increased at the expense of natural gas.

The Energy Information Administration cut its forecast for US coal exports by 3.5% for this year blaming falling international coal prices and continued economic problems in Europe.

Russian energy giant Gazprom and Shell have agreed to joint exploration and development of shale oil and Arctic offshore projects in Russia as well as an offshore area outside the country.

Petrol stations in the UK have noticed the volume of fuel that they sell fall significantly over the past five years as high prices have forced people to buy more fuel efficient cars, and drive less. Petrol sales have fallen by more than 20 percent as oil prices have climbed to record highs.

The world will see a sharp drop in the number of new wind turbines installed this year after record growth in 2012, a report by the Global Wind Energy Council said. The report forecast annual installations for 2013 will drop by more than 11% to just under 40 gigawatts and then recover sharply in 2014 and beyond, with global capacity growing at an average rate of more than 11% from 2014 and 2017. The organization said the greatest threat to the continued stable growth of the wind industry is the variability and unpredictability of the politicians who set the frameworks for the energy sector.

 

 

 

with h/t Tom Whipple

 

 

 

 

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