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Economy

Key energy agencies diverge as demand and oil prices climb

Published

3 years ago

6 minute read

DUBAI, United Arab Emirates (AP) — Leaders of the world’s most consequential energy bodies gathered for a forum Wednesday to discuss the uncertain future of oil as demand rebounds and prices climb, all while a growing roster of nations pledge to transition to cleaner forms of energy.

The forum, which included speakers from the Organization of Petroleum Exporting Countries, the International Energy Agency and the International Energy Forum, presented varying forecasts for oil demand and discussed energy security and market stability.

Yet from the outset, the wider debate on how the world should best transition away from so-called dirty fuels and other sources of carbon emissions that pollute the air played out as speakers gave their remarks.

Major oil-producing nations, like Saudi Arabia and the United Arab Emirates, have long argued that a rapid energy transition away from the fossil fuels that they continue to rely on for revenue will impact global economic growth and hurt the world’s poorest. Those backing a fast-tracked transition insist new investments in energy must go toward expanding existing wind and solar solutions and in funding innovative solutions if the world is to avoid catastrophic global warming levels. On both sides, however, there is agreement that the world is far from reaching sustainable targets as demand for energy grows.

“We are not on track. So how should policy makers respond to this dilemma? The reality is that 80% of the world’s energy needs continue to be met by fossil fuels,” said Joseph McMonigle, secretary general of the Saudi-based International Energy Forum that hosted the symposium. The IEF is the largest organization of energy ministers, with 71 member states, including the United States.

McMonigle said global energy demand has “roared back” to pre-pandemic levels, but that investments in oil and gas are not back to where they were before the COVID-19 crisis.

“Disinvestment in energy supply will not deliver a just and orderly transition and cannot be a response to the climate crisis,” he said, arguing that countries should invest in both greener forms of energy as well as fossil fuels.

The IEF has called for oil and gas investment to reach $525 billion through 2030 to ensure “market balance” despite a slowdown projected in how much demand for oil will grow. The group notes that investment in the oil and gas sector in 2021 stood at $341 billion. Without more financing, the IEF says demand could outstrip future supply within the next five to six years. They say it could also result in switching to more polluting energy sources such as wood and coal.

Others disagree. The International Energy Agency’s executive director has said the world does not need more investments in new oil, gas and coal projects.

From Paris, the IEA’s Fatih Birol did not directly address the comments made by McMonigle, but he echoed the sentiment that the energy transition must happen in an “orderly manner” so that climate targets are met and oil producing economies are seen as part of the solution.

To meet these targets, the world must reduce its consumption of fossil fuels, Birol said, before later adding: “We cannot drop oil and gas tomorrow.”

“The world will need oil and gas for several years to come. However, if we want to reach our climate targets we would need less oil and less coal and less gas than we use today in an unabated format.”

The IEA says that for the world to reach net-zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around $4 trillion. It has also called out the energy sector as the source of around 75% of greenhouse gas emissions, a main driver in climate change.

The IEA estimates that world oil demand is set to expand by 3.2 million barrels per day this year, reaching 100.6 million barrels per day as restrictions to contain the spread of the coronavirus ease. Benchmark crude prices rose by more than 15% in January to cross the $90 per barrel threshold for the first time in more than seven years.

The rebound in demand for oil, combined with a shortfall in energy investments, rising prices and market uncertainty has led to varying energy outlook scenarios. The diverging outlooks by OPEC, the IEF, IEA and others have an impact on how governments choose to formulate their energy policies and decide on production levels as they commit to net-zero pledges.

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Follow Aya Batrawy on Twitter at www.twitter.com/ayaelb

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Follow AP’s climate coverage at http://apnews.com/hub/climate

Aya Batrawy, The Associated Press

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Business

Carbon tax bureaucracy costs taxpayers $800 million

Published on November 19, 2024

By

From the Canadian Taxpayers Federation

By Ryan Thorpe

The cost of administering the federal carbon tax and rebate scheme has risen to $283 million since it was imposed in 2019, according to government records obtained by the Canadian Taxpayers Federation.

By 2030, the cost of administering the carbon tax is expected to total $796 million, according to the records.

“Not only does the carbon tax make our gas, heating and groceries more expensive, but taxpayers are also hit with a big bill to fund Prime Minister Justin Trudeau’s battalion of carbon tax bureaucrats,” said Franco Terrazzano, CTF Federal Director. “Trudeau should make life more affordable and slash the cost of the bureaucracy by scrapping the carbon tax.”

The government records were released in response to an order paper question from Conservative MP John Barlow (Foothills).

The carbon tax and rebate scheme cost taxpayers $84 million in 2023, according to the records.

There were 461 federal bureaucrats tasked with administering the carbon tax and rebate scheme last year, according to the records.

The CTF previously reported administering the carbon tax cost taxpayers $199 million between 2019 and 2022.

Projected costs for administering the carbon tax and rebate scheme between 2024 and 2030 are $513 million, according to the records.

That would bring total administration costs for the carbon tax and rebate scheme up to $796 million by 2030.

But the true hit to taxpayers is even higher, as the records do not include costs associated with the Fuel Charge Tax Credit for Farmers or the Canada Carbon Rebate for Small Businesses.

“It’s magic math to believe the feds can raise taxes, skim hundreds-of-millions off the top to hire hundreds of new bureaucrats and then somehow make everyone better off with rebates,” Terrazzano said.

The carbon tax will cost the average household up to $399 this year more than the rebates, according to the Parliamentary Budget Officer, the government’s independent, non-partisan budget watchdog.

The PBO also notes that, “Canada’s own emissions are not large enough to materially impact climate change.”

The government also charges its GST on top of the carbon tax. The PBO report shows this carbon tax-on-tax will cost taxpayers $400 million this year. That money isn’t rebated back to Canadians.

The carbon tax currently costs 17 cents per litre of gasoline, 21 cents per litre of diesel and 15 cents per cubic metre of natural gas.

By 2030, the carbon tax will cost 37 cents per litre of gasoline, 45 cents per litre of diesel and 32 cents per cubic metre of natural gas.

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Economy

COP 29 leaders demand over a $1 trillion a year in climate reparations from ‘wealthy’ nations. They don’t deserve a nickel.

Published on November 16, 2024

By

From Energy Talking Points

The injustice of climate reparations

COP 29 is calling for over $1 trillion in annual climate reparations

  • A major theme of COP 29 is that the world should set a “New Collective Quantified Goal” wherein successful nations pay poor nations over $1 trillion a year to 1) make up for climate-related harm and 2) build them new “green energy” economies. In other words, climate reparations.¹
  • What would $1 trillion a year in climate reparations mean for you and your family?Assuming the money was paid equally by households considered high income (>$50 per day), your household would have to pay more than $5,000 a year in climate reparations taxes!²
  • Climate reparations are based on two false assumptions:1. Free, wealthy countries, through their fossil fuel use, have made the world worse for poor countries.

    2. The poor world’s main problem is dealing with climate change, which wealth transfers will help them with.

But free, fossil-fueled countries have made life better for poor countries

  • Free, wealthy countries, through their fossil fuel use, have not made the world worse for poor countries—they have made it far, far better.Observe what has happened to global life expectancies and income as fossil fuel use has risen. Life has gotten much better for everyone.³
  • The wealthy world’s fossil fuel use has improved life worldwide because by using fossil fuel energy to be incredibly productive, we have 1) made all kinds of goods cheaper and 2) been able to engage in life-saving aid, particularly in the realms of food, medicine, and sanitation.
  • Without the historic use of fossil fuels by the wealthy world, there would be no super-productive agriculture to feed 8 billion humans, no satellite-based weather warning systems, etc. Most of the individuals in poor countries would not even be alive today.

Free, fossil-fueled countries have made the poor safer from climate

  • The wealthy world’s fossil fuel use has been particularly beneficial in the realm of climate.Over the last 100 years, the death rate from climate-related disasters plummeted by 98% globally.

    A big reason is millions of lives saved from drought via fossil-fueled crop transport.⁴
  • The “climate reparations” movement ignores the fact that the wealthy world’s fossil fuel use has made life better, including safer from climate, in the poor world.This allows it to pretend that the poor world’s main problem is dealing with rising CO2 levels.

The poor world’s problem is poverty, not rising CO2 levels

  • The poor world’s main problem is not rising CO2 levels, it is poverty—which is caused by lack of freedom, including the crucial freedom to use fossil fuels.Poverty makes everything worse, including the world’s massive natural climate danger and any danger from more CO2.
  • While it’s not true that the wealthy world has increased climate danger in the poor world—we have reduced it—it is true that the poor world is more endangered by climate than the wealthy world is.The solution is for the poor to get rich. Which requires freedom and fossil fuels.⁵

Escaping poverty requires freedom and fossil fuels

  • Every nation that has risen out of poverty has done so via pro-freedom policies—specifically, economic freedom. 

    That’s how resource-poor places like Singapore and Taiwan became prosperous. Resource-rich places like Congo have struggled due to lack of economic freedom.

  • Even China, which is unfree in many ways (including insufficient protections against pollution) dramatically increased its standard of living via economic freedom—particularly in the realm of industrial development where it is now in many ways much freer than the US and Europe.
  • A crucial freedom involved in rising prosperity has been the freedom to use fossil fuels.Fossil fuels are a uniquely cost-effective source of energy, providing energy that’s low-cost, reliable, versatile, and scalable to billions of people in thousands of places.⁶
  • Time and again nations have increased their prosperity, including their safety from climate, via economic freedom and fossil fuels.Observe the 7X increase in fossil fuel use in China and India over the past 4 decades, which enabled them to industrialize and prosper.⁷
  • For the world’s poorest people to be more prosperous and safer from climate, they need more freedom and more fossil fuels.The “climate reparations” movement seeks to deny them both.
  • The wealthy world should communicate to the poor world that economic freedom is the path to prosperity, and encourage the poor world to reform its cultural and political institutions to embrace economic freedom—including fossil fuel freedom.Our leaders are doing the opposite.

Climate reparations pay off dictators to take away fossil fuel freedom

  • Instead of promoting economic freedom, including fossil fuel freedom, wealthy climate reparations advocates like Antonio Guterres are offering to entrench anti-freedom regimes by paying off their dictators and bureaucrats to eliminate fossil fuel freedom.This is disgusting.⁸
  • The biggest victim of “climate reparations” will be the world’s poorest countries, whose dictators will be paid off to prevent the fossil fuel freedom that has allowed not just the US and Europe but also China and India to dramatically increase their prosperity.
  • The biggest beneficiary of “climate reparations” will be China, which is already emitting more CO2 than the US and Europe combined. (Though less per capita.)While we flagellate and cripple ourselves, China will use fossil fuels in its quest to become the world’s superpower.⁹
  • The second biggest beneficiary of “climate reparations” will be corrupt do-gooders who get to add anti-fossil-fuel strings to “reparations” dollars and dictate how it’s spent—which will surely include lots of dollars for unreliable solar panels and wind turbines made in China.

Leaders must reject reparations and champion fossil fuel freedom

  • We need leaders in the US and Europe who proudly:1. Champion the free world’s use of fossil fuels as an enormous good for the world, including its climate safety.

    2. Encourage the poor world to embrace economic freedom and fossil fuels.

    Tell your Representative to do both.

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1  Scientific American – COP27 Summit Yields ‘Historic Win’ for Climate Reparations but Falls Short on Emissions Reductions
2  Global population was about 8.02 billion in 2023.

World Bank data

About 7% of world population are considered high income, which translates into about 562 million individuals. Considering 3 people per average household in high income households, this translates into about 187 million households.
Pew Research – Are you in the global middle class? Find out with our income calculator

$1 trillion per annum paid by 187 million households means the average household would pay about $5,300 per year.

3  Maddison Database 2010 at the Groningen Growth and Development Centre, Faculty of Economics and Business at University of Groningen
4  UC San Diego – The Keeling Curve

For every million people on earth, annual deaths from climate-related causes (extreme temperature, drought, flood, storms, wildfires) declined 98%–from an average of 247 per year during the 1920s to 2.5 in per year during the 2010s.

Data on disaster deaths come from EM-DAT, CRED / UCLouvain, Brussels, Belgium – www.emdat.be (D. Guha-Sapir).

Population estimates for the 1920s from the Maddison Database 2010, the Groningen Growth and Development Centre, Faculty of Economics and Business at University of Groningen. For years not shown, population is assumed to have grown at a steady rate.

Population estimates for the 2010s come from World Bank Data.

5  UC San Diego – The Keeling Curve

Data on disaster deaths come from EM-DAT, CRED / UCLouvain, Brussels, Belgium – www.emdat.be (D. Guha-Sapir).

Population estimates come from World Bank Data.

6  Our World in Data – Energy Production and Consumption
7  BP – Statistical Review of World Energy
8  UN News – ‘Pay up or humanity will pay the price’, Guterres warns at COP29 climate summit
9  Our World in Data – Annual CO₂ emissions from fossil fuels, by world region
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