Climate Letter #289

December 4, 2014

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Tragedy rapidly unfolding in Brazil. Deforestation is a major source of carbon overload, second only to burning fossil fuels. It also causes wreckage in the hydrological cycle. This has all been known for a long time—just as the greater emissions problem has long been known—but Brazilians have put off doing what was needed to stop it, or to make sound preparations for mitigating the damage. Now the chickens are coming home to roost, having already entered the coop, as literally millions of people are in the process of losing their entire supply of fresh water. Where will they go? Could there be a lesson here for the rest of us?
Extra comment: Not to be overlooked is the known fact that logging industry representatives, all over the world, have honed their ability to cultivate relationships with government officials, just as do those of the coal and oil industries. And lots of good jobs are involved, adding to the pressure.
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What is next for China? “China agrees to enhance its role in global climate change mitigation.” When you play with the numbers, looking for instructive points, what do you see? China today has 30% of the world’s CO2 emissions, v. 10% for Europe. Per capita figures are now the same for both (which is about half of the U.S. figure.) Europe is hardly growing at all, and wants to drastically cut emissions over the next 25 years, a huge challenge. China could probably match what Europe hopes to do, and needs to because of its size, but that is unlikely to happen if it also wants to keep on growing. A modest, for China, 3% growth rate doubles its economy in 25 years. Forget 6%, which quadruples it. I do think China, which has loads of financial reserves, could simply wind down producing for export and convert much of that activity to goods for its home market, perhaps doing so with a lighter (and cleaner) amount of energy. They would thus end up much better off internally, even without “growing” at all! But then, where does that leave the U.S?
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Green bonds are now here. This is a new line of business, still immature, but showing extraordinary growth. Big institutional money, with proper backing from analysts, is available. Low-cost financing for a multitude of high-cost investments is a major positive factor for putting renewables in place.
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Another interesting solar cell innovation. Not ready for market yet, but the idea appears to have credibility with National Geographic reporting.
Carl

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