The Obama administration has blocked any new drilling permits for oil in the Arctic for the next two years, and refused requests to extend existing drilling permits. The decision follows Shell’s abandonment of Arctic drilling in September and could signal the end of the threat of oil exploration in the delicate Arctic ecosystem.
Transport is the greatest consumer of energy in the developed world, consuming more than industry, the International Energy Agency (IEA) has found for the second consecutive year. In the EU, transport still lags behind industry in total final energy consumption, but the gap is narrowing, and road transport’s continued reliance on oil is making the sector increasingly slow to embrace lower-emission energy.
New figures show the amount of biofuels being used for transport in the EU rose by 6.1% in 2014, but the increase is less than the fall in transport biofuels registered in 2013. The rise suggests trends are going in the wrong direction as biodiesel takes up the most important part of the increase, though the figures should be treated with caution because there is limited information on the type of feedstocks used to produce these biofuels.
It is impossible to have missed the news on cheap oil and gas, and what it is doing to our economies. A Google search for ‘oil price drop’ shows you what Reuters, BBC, Bloomberg, Forbes, etc – the big boys – have to say on the subject. And shale plays a key role in both. And indeed, oil costs less than it did in 2008 and 2012. And indeed, this is having a big economic impact. It means that Europe in 2014 saved around 1% of GDP, more than €100 billion, in import bills. A free and welcome boost. But this column is not seeking to add to what Reuters has to say. It wants to offer two other perspectives.
Bioenergy accounted for more than half of all renewable energy demand in Europe in 2014, according to projections just released by the European Commission. Burning biomass and biofuels account for 47% and 9%, respectively, of renewable energy, versus 11% from wind, 17% from hydro and 7% from solar.
The world’s governments will spend $5.3 trillion (€4.8 trillion) subsidising the cost of oil, gas and coal this year, thereby undermining their attempts to combat global warming and wealth inequality and fund public health.
Six of the largest oil and gas companies in Europe have called for the UN to let them help devise a global carbon pricing system. Responding to rising pressure ahead of the Paris climate talks at the end of this year, the chief executives of Royal Dutch Shell, BP and BG Group from the UK, France’s Total, Norway’s Statoil and Italy’s Eni have sought direct talks with governments.
April 2015 will enter history as the month in which the EU reversed course on its energy policies in transport. It adopted its long-mooted reform of biofuels policy – especially regarding indirect land-use change (ILUC). The practical implications in the next years may not be so big. But the political and longer-term ones are.