Worldwatch Institute

Abu Dhabi Chosen to Host IRENA

Ben Block — Tue, 30 Jun 2009 17:48:09 -0400

Members of an expanded International Renewable Energy Agency (IRENA) have chosen Abu Dhabi as the agency's first headquarters and French diplomat Hélène Pelosse as its first director-general.

A coalition of African and Arab nations celebrated locating the agency in the United Arab Emirates, praising the selection as a success for the developing world. Despite widespread political support, the chosen location and director-general faced criticism from within the renewable energy community due to concerns that nominating countries were attracting votes in exchange for nuclear energy deals.

Representatives from 136 countries [PDF] participated in a summit this week in Sharm el-Sheikh, Egypt, to decide the clean energy agency's headquarters and leadership. Prior to the vote, Australia, Costa Rica, Japan, the United States, and the United Kingdom joined the agency.

Major industrialized countries such as the United States and Japan were initially hesitant to join IRENA because of the existence of other organizations that provide advice for renewable energy development, such as the United Nations and the International Energy Agency.

Hermann Scheer, a member of the German parliament who first called for IRENA's formation in 1990, said that neither of those organizations provides sufficient focus on renewable energy.

"The fact that 136 states have signed IRENA's statute will rebut the skeptics. There does not exist another international governmental organization which had so many members at its formation," said Scheer, who chairs the World Council for Renewable Energy, in a statement. "It is now crucial to swiftly set up a powerful organization and to endow it with the necessary resources to support member states in drafting policies to introduce renewable energies nationally."

The headquarters will be located in Abu Dhabi's Masdar City, a new planned city that aims to produce zero net carbon emissions and zero net waste. To raise support for hosting IRENA, the UAE government committed $22 million of annual support through 2015. The Abu Dhabi Fund for Development also offered $50 million in annual loans to finance renewable energy projects in developing countries.

"We in the UAE extend our hands to all countries of the world. The agency is not exclusively for the Emiratis. It is an international asset," UAE Foreign Minister Sheikh Abdullah bin Zayed Al Nahyan told the Emirates News Agency. "All countries of the world have a right in the agency."

Competing cities Bonn, Germany, and Vienna, Austria, withdrew their bids to host the agency at the Sharm el-Sheikh meeting. The countries' leaders forged a deal that will instead divide IRENA among the new headquarters in Abu Dhabi, a center of technology and innovation in Bonn, and an inter-organizational liaison office in Vienna.

The compromise "reflects the spirit of cooperation that is needed for IRENA to grow into a strong and effective organization," an IRENA statement said.

Copenhagen, Denmark, was the fourth city nominated to host the agency, but the Danish government withdrew from the competition prior to this week's meeting in an effort to support a Bonn location.

An Abu Dhabi location received support from the African Union, France, Spain, Italy, and several Arab nations.

Clean energy advocates raised concerns that the UAE and France were attracting votes for one other in an effort to support unrelated interests such as new nuclear energy projects. The advocates supported their complaints in part by pointing to deals that the United States and France finalized earlier this year to develop several nuclear reactors in the UAE.

Pelosse, the newly elected interim director-general, said in an interview with the Worldwatch Institute that these concerns were unfounded.

"The idea that IRENA would be tainted by nuclear interests is simply wrong," said Pelosse, the French Minister of State's deputy head of staff in charge of international affairs. "Firstly, it is not in its statutes. Second, there already is an international organization in charge of nuclear energy. There is no way IRENA is ever going to deal with nuclear energy."

Pelosse led last year's European Union negotiations to form binding targets of 20 percent renewable energy by 2020. She has also helped design France's renewable energy policy and the Mediterranean Solar Plan, an effort to develop 20 gigawatts capacity of new renewable energy resources in the Mediterranean region by 2020.

"Ms. Pelosse has established a long record of outstanding experience and profound knowledge of the renewable sector as well as strong communication and representation skills," an IRENA statement said.

The other director-general candidates were Juan Ormazabal of Spain, Arthouros Zervos of Greece, and Hans Jǿrgen Koch of Denmark.

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jtier@worldwatch.org

OPINION: Turn up the Heat in the Climate Battle

Michael Renner — Mon, 29 Jun 2009 12:47:40 -0400

Are environmental groups still relevant as the world battles climate change? On the face of it, this seems a farcical question. Environmentalists have worked tirelessly to alert the public and decision-makers alike to the dangers of climate change and to advocate a fundamental shift away from fossil fuels. And on June 26, many celebrated when the U.S. House of Representatives narrowly approved the American Clean Energy and Security (ACES) bill [PDF] - the first U.S. climate legislation ever.

But as the climate debate enters a decisive phase - with negotiations in full swing to hammer out an international agreement in Copenhagen this year - there is a darker side. With few exceptions, current national goals for cutting greenhouse gas emissions are weak and typically push action to the distant, rather than the near, future. Although part of the environmental community has responded critically, other groups claim that more stringent climate action is simply not politically feasible - and that asking for more risks the collapse of any climate deal.

The Obama administration's chief climate negotiator, Todd Stern, has rejected calls for industrialized countries to cut their emissions by 40 percent below 1990 levels by 2020. He not only opposed such cuts as "not feasible" for the United States, but strikingly judged them as "unnecessary." ACES is muddying the waters by pegging reductions to 2005, rather than to the internationally recognized benchmark of 1990. The reason seems clear: given the strong growth of U.S. emissions in the interim, proposed reductions of 17 percent relative to 2005 look much better than the measly 4 percent relative to 1990.

Even some of the European governments that paraded themselves as climate champions while George Bush was in the White House are now backtracking on climate goals. Strong corporate pressure, reinforced by the jitters of the global financial crisis, has given them pause. Rich countries are evading their historical responsibility for the bulk of emissions. Instead of strong domestic action, "offsets" are being presented as the great savior - asking poorer nations to shoulder the burden that wealthy countries are not prepared to bear themselves. From a national perspective, offsets may be an option; from a global perspective, they amount to a rearrangement of deck chairs on the Titanic.

As far back as 1998, my Worldwatch colleague Christopher Flavin criticized international climate negotiations as a "black box - a process largely invisible and incomprehensible to the public." His article, "Last Tango in Buenos Aires" (the city where the negotiations of the day were being held), sounded a clarion call for decisive action. But the years and rounds of meetings since have mostly brought delays and excuses, steadily kicking the can down the road. The refrain has become predictable: "We didn't succeed in [place name], but we still have the upcoming meeting in [place name] to get it right."

Well, we are reaching the end of the road. In Worldwatch's State of the World 2009 report, climate scientist Bill Hare argues that fossil carbon dioxide emissions will need to come close to zero by 2050 - decades earlier than what most governments envision - and that deforestation needs to end well before 2030. The longer we delay serious action, the greater the danger of reaching destabilizing tipping points.

Segments of the environmental movement, especially grassroots-oriented groups, have been quite vocal in their criticism of current policies. But others have endorsed weak proposals, arguing that they can be improved upon later - without offering a strategy for doing so or a reason why the balance of forces should be expected to be more favorable later on. Their slogan of choice is "don't let the perfect be the enemy of the good." Catchy, but is it convincing?

The ultimate outcome of any process is the product of ideas and proposals put forward by different actors, as well as the relative power of these actors. Environmental groups that fail to turn up the pressure are effectively narrowing the scope of what is politically possible. It is like waving a white flag while the battle is still raging.

Some may honestly feel that there is no other way - that status quo forces in government and the corporate world are too powerful. But there's also an inconvenient truth. Not rocking the boat often equals respectability in mainstream opinion for environmental organizations. Having access to the corridors of power, whether in Washington, Brussels, or other world capitals, gives the appearance of influence and importance - and surely helps in securing future funding.

While compromise and horse-trading may be essential in politics, the Earth's climate is not swayed by it. In light of the disappointing trajectory of climate policymaking, environmentalists need to rediscover their roots. Rallying public opinion is critical to gain leverage in the titanic struggle over the Earth's fate.

Environmental groups need to hold fast to the demands of climate science, continue to offer credible alternatives, and criticize and expose inadequate policies. (For all the celebration following the House passage of ACES, this legislation is in great need of strengthening as the Senate considers it.) There is nothing wrong with continuing quiet lobbying and consultations. But that alone will not suffice.

What is needed now is smart and persistent public messaging and mobilizing constituents so as to put legislators and corporate executives on notice: politics as usual will not save the planet. It is time to turn up the heat in the fight against global warming. The livelihoods, and lives, of hundreds of millions of people are at stake.

Michael Renner is a Senior Researcher at the Worldwatch Institute, an environmental research organization based in Washington, D.C.

Interview with IRENA Director General Nominee Hélène Pelosse

Ben Block — Thu, 25 Jun 2009 20:43:14 -0400

European environmentalists dedicated the 2008 International Women's Day to a newfound heroine: Hélène Pelosse. The lead negotiator of a European Union directive to achieve a 20 percent renewable energy share of regional energy consumption by 2020, Pelosse delivered the agreement in time for the annual recognition of female achievement. Born in Montréal, Pelosse attended university in France and rose quickly through several government jobs, including work as a finance inspector and trade adviser, and she currently serves as the Minister of State's deputy head of staff of international affairs. She also advised Angela Merkel's office during the German presidency of the European Union.

Pelosse is one of four nominees to head the International Renewable Energy Agency (IRENA). IRENA members are meeting this weekend in Sharm el-Sheikh, Egypt, to choose a headquarters and select a director-general. Worldwatch staff writer Ben Block is interviewing candidates this week for Eye on Earth.

How did you manage to negotiate the European Union agreement to increase renewable energy to 20 percent by 2020?

We had tough discussions.... Europe was split. The big issue was how much flexibility countries would have and what would happen if they could not achieve the goal. Toward the end, the energy minister of Germany flew out of the meeting. Germany was the first to have large renewable energy capacity, [and he] was afraid that they would have their capacity taken by others [in a credit exchange system]. I had to run after him and ask him to strike an agreement with Italy. He came back.... We gave flexibility to countries and were still able to stick to our objectives. We didn't depart from the initial [20 percent] figures, which was a huge success.... If countries don't achieve the targets, they will end up in the court of justice. But we give states a degree of flexibility. You have some flexibility if you don't achieve your targets for any one year.

France plans to introduce a national carbon tax by 2011. Why is a tax the best way to reduce France's greenhouse gas emissions?

It's one tool that could be quite efficient. If you really want to change behavior, you have to give the right signal.... Fuel taxation itself is a type of tax on carbon. How do you widen it to all economic actors? Right now that is not the case. Right now we are taxing fuels - the U.S. doesn't really do it, but fuel is heavily taxed in France and generally in Europe. Also now we have the ETS [European Union Emission Trading Scheme] carbon quotas for the energy sector and heavy industry. They will be subject to some kind of carbon tax since they will be obliged to buy their quotas, and they'll need to do that more and more as time goes by.

What parts of the economy should the carbon tax include?

We have to think a bit more about that. But if you take the example of aviation, this is an industry that uses fuel - but fuel that is not taxed right now, although aviation has been included in a directive that links with the ETS system. That's something we need to think about. You have other industries not in the ETS system because of their smaller size, so what do we do with them?... Our president has [appointed] former Prime Minister Michel Rocard [to lead the carbon tax initiative] - someone who is widely recognized for being a consensus builder, in particular when he advocated a tax on social security, which is called the "Contribution Sociale Généralisée (CSG)."... If [Rocard] managed to pass the law on CSG he might be the right person to get consensus on the carbon tax, which is similarly no easy issue.

If France can figure out an effective carbon tax, should the rest of the European Union follow?

Climate change is a global fight. We need to make sure that you do not allow carbon leakage.... If we limit emissions in some places while you can emit as much as you want in other places, we'll go nowhere and the climate situation will not improve.... There has been discussion of an EU carbon tax at its borders. Basically, if you are based in Europe, importing goods from China or any other place in the world where environmental dumping would be going on, we would try to avoid the consequences of that by establishing an equalizing mechanism. Goods imported in Europe would have to pay a carbon quota as they cross the border. This has been proposed as part of the ETS directive, but we will negotiate that after international climate negotiators have reached an agreement at the Copenhagen United Nations summit in December.... Industrial countries, as historical polluters, must make a bigger effort than others but it does not mean that others do not need to do anything. We cannot afford to have huge constraints in some places and no constraints in other places.

A carbon tax would internal the costs of greehouse gas emissions and make renewable energy cheaper compared to fossil fuels. To what extent should renewable energy be subsidized as well?

Definitely [renewables] should be subsidized, especially in the beginning. We're starting something new.... Let's be serious for a second and compare it to what's happening with oil. Can you say right now there's no subsidies for oil? No. If we want to avoid windfall profits, if you don't want to hamper renewable energy, then you have to make sure there are not more subsidies on the other side.... It's a distortion, at the end of the day. There are energy sources we prefer because [they are] clean and climate-friendly, but they are not competing in a level playing field.... We have to phase-out subsidies for oil. That's definitely difficult as well. I won't give you any number of years [required] for abandoning subsidies for renewables. We are not quite there yet....

I tend to believe more in an approach along the lines that old energy forms should be utilized to finance new ones. We know our current source of energy, oil, will not be around for many more years. We should make sure this money can also be used to finance the next generation of clean energy. That would make sense.

What financing options must be adopted to accelerate renewable energy deployment?

First, a policy device. If you have a good policy framework, you are going to get the financing.... In Jordan and Morocco, they are working on a law to set up a fund that will offset the extra costs of producing renewable energy. Of course, it's much easier in Morocco because they don't subsidize fossil energy as they do in Jordan or Egypt.... The World Bank, development banks, and other dedicated funds have to work on program-based solutions under the climate change convention. Right now, the Clean Development Mechanism is not suited to finance renewable energy. It's too complicated. Small-scale renewable energy projects do not generate such large amounts of money.

The idea for IRENA is to do the job for everybody, at lower transaction costs, and to just make things happen. We have to be innovative and creative. We have to think of novel ways to get funds. We're not there yet. We should think about activities that are growing and leverage their revenue - maybe areas that are related to information technology, the Web.... There are lots of websites right now popping up everywhere around the world trying to raise funds for projects. Kiva.org, a project in the Third World with no financing, raises $50 per individual donor - through microfinancing. It's something we should think about. It would also be possible to channel migrant remittances toward renewable energy projects.

Have you come across a good example of such innovation in the developing world?

In Bangladesh, they have experience with equipping villages and providing women with PV [photovoltaic] panels on roofs for $300, paid of course via microcredit schemes. This is being done on a very large scale. This is an example of how one of the poorest countries in the world can provide people with electricity. It's not much. Each home has two light bulbs, one PV panel, and a charger for their mobile [phone] and a TV. It's changing lives. Half of the products are produced in Bangladesh - not the PV panel, but in time it too will be manufactured in Bangladesh. Bangladeshi women manufacture all the rest, all the rechargers. We have to build on those experiences and see how we can expand them worldwide.

Should IRENA promote specific policies such as national renewable energy portfolio standards, which set a specific target for clean energy, or feed-in-tariffs, which guarantee a market and fixed payment for renewable energy producers to sell their power to the grid?

I do think that those types of tools are very powerful, but you can't use them in every country.... With a feed-in tariff, some countries just can't afford that. For some, it would be very difficult because they are already subsidizing fossil energy prices.... It's very difficult to switch to renewable energy because renewables are way more expensive. We need to find smart ways.... For example, in many African countries the energy staple is biomass-women grabbing some wood to cook with. You want to establish a feed-in tariff? Well, good luck with that! In that case it would be better to start a different program: improved cooking stoves. Improve the situation of women so they can be healthier, burn less wood, be much more energy efficient. That's how pragmatic you have to be with renewable energy.

France often talks about low-carbon energy solutions when fighting climate change. Should IRENA expand its purview to include any low-carbon solution?

Should IRENA deal with nuclear? No. We already have an international organization that deals with nuclear energy.... I do not think that IRENA should have anything to do with that. It is certainly not going to deal with nuclear energy; that would not make any sense. Nuclear energy is a totally different story. It is a mature technology, it has its own risks, and then there's the issue of waste. Unlike renewables, it is not a universal solution.

I ask because renewable energy advocates have expressed concerns about a so-called "nuclear tainted" IRENA. The concerns are based largely on the fact that the United Arab Emirates has agreed to nuclear energy deals with the United States and France. Meanwhile, Abu Dhabi is lobbying to host the agency.

Of course there is cooperation between France and Abu Dhabi. Of course France knows that nuclear energy is not at all a renewable form of energy. In fact, early last year, France accepted a target of 23 percent renewable energy by 2020 - more than Germany, at 18 percent - and the [French] target is nuclear-free. But there is nuclear energy in France.... Some countries want to import nuclear energy - it's their choice. The idea that IRENA would be tainted by nuclear interests is simply wrong: firstly, [nuclear] is not in its statutes. Second, there already is an international organization in charge of nuclear energy. There is no way IRENA is ever going to deal with nuclear energy. Certainly not with me if I'm elected.

Note: The fourth nominee, Centro Nacional de Energías Renovables Director General Juan Ormazábal of Spain, was not available for an interview.

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jdiamond@worldwatch.org.

Interview with IRENA Director-General Nominee Arthouros Zervos

Ben Block — Wed, 24 Jun 2009 15:33:06 -0400

Professor Arthouros Zervos taught his first wind energy class in 1982. Since then, the native of the Greek island of Corfu has provided renewable energy advice to the governments of Greece, Cyprus, and China as well as to the European Commission, the Intergovernmental Panel on Climate Change, and several industry associations. Currently chairman of the Global Wind Energy Council and president of the European Wind Energy Association, Zervos has helped develop some of the world's most influential industry bodies in the renewables sector.

Zervos is one of four nominees to head the new International Renewable Energy Agency (IRENA). IRENA members are meeting this weekend in Sharm el-Sheikh, Egypt, to choose a headquarters and select a director-general. Worldwatch staff writer Ben Block is interviewing candidates this week for Eye on Earth.

What lessons have you learned from your experiences in Europe and China about how to help emerging economies develop renewable energy?

For me, the critical issue is setting up the right framework. Germany, for example, is not the country with the most potential in terms of renewable energy-it's one of the most cloudy countries in Europe. But big solar development is happening in Germany, which means that the potential is really based on whether a country has significant policies that help the development of renewables. We have a lot of experience in Europe with different systems, different ways of approaching renewables. I'm not saying one is better than another. What we have learned is what we have to pay attention to.

What is IRENA's role in establishing these frameworks? Should the agency decide which mechanisms are best?

We should advise on how to set up the framework, but I don't believe that there is one framework that has to be [used]. The feed-in price has been the most effective support mechanism. Also, the [renewable energy portfolio] target system in different U.S. states has been very effective if appropriately applied. If you [are just starting to develop renewables], the feed-in system is probably most appropriate. But once you reach a certain stage of development, [it is best to] move to other means of support. The right support is not only economic. You have other issues that are critical-for example, in the electricity sector, the grid issue. How do you develop your grids, what are your grids, how do you develop them to absorb large amounts of renewables?... An advisor would not want to go to a country and tell them what to do. An advisor has to discuss and give quality advice.

Why is the feed-in tariff, a policy that guarantees a market and fixed payment for renewable energy producers to sell their power to the grid, the most efficient?

From our experiences in Europe, where we have a support system based on a feed-in price, it has been more effective in developing renewables, especially at the beginning stages, because it's a very simple mechanism. You have a price, which can be very easily seen by the banks. So you can have much easier financing, because once you know your potential and you know your price, you know that it's fixed for the next 15 or 20 years.

Could feed-in tariffs succeed in developing-country markets?

That is a question mark. If you have a very weak economy and have very low energy prices, then it is a problem. You have to find some other ways. That's why I'm saying I don't consider [the feed-in tariff] as a silver bullet for everything. If a country has very low prices, it means energy prices are subsidized. You have to compete with subsidized energy prices. The feed-in price that you'd have to put [in place] for the investments to be appropriate will probably be too high for the situation. One has to analyze each situation and see what is the most appropriate way to move forward.

Under what conditions, and to what extent, should renewable energy be subsidized?

The basic question is [whether we can] create a level playing field [for renewables] with other energy sources, which does not exist right now. It does not exist because you have a certain level of costs that are not included in energy prices today, mainly the environmental costs. I would propose that one way or another, we include environmental costs in the energy price-then you don't need anything else. The question is whether these [price adjustments] should pass through international agreements in that direction-though it is not evident that this will or can happen in the near future.

Then you have the second-best option, which is support-support in order to compensate for the fact that you have not internalized the external costs. I do not consider support to renewables as a subsidy. I consider it as a compensation for the environmental and social costs which are not internalized in the energy price.... [T]here is a lot of talk about the subsidies given to renewables-why and how much, and for how long you would give them. I would say we don't have to give subsidies from the moment we have the right playing field-the polluter pays, and we include the environmental costs. As long as we don't do that, we have to compensate.

Are you suggesting that if there is a price on carbon, additional subsidies for the renewable energy sector would become unnecessary?

Hypothetically, yes-if the price functions well, which takes time. Also, you need a price on an international level. It's not enough [to set prices at the] national or regional level. It's very critical that we have an international agreement, which we are discussing now....

How this is reflected in the energy market is another story. It is a very big step forward, the carbon price, but this is not enough.

In addition to financing, renewable energy must overcome a general lack of respect compared to traditional energy sources. How do you suggest elevating IRENA to a level so that renewables gains wider recognition?

An important development of an organization is to have a vision and to be serious in the analysis that it is doing. That's a very critical point-how we look into the future. Other existing international organizations, especially the International Energy Agency, have their own visions of the future, which I wouldn't say that I would agree [with]. IRENA has to realize and [have the perspective] that renewables have to play a major role in the world's energy future, which is not always evident from other international organizations. This needs to be broadened through IRENA's work and analysis.

How should IRENA address controversial sources of energy such as biofuels? Do you consider them to be "renewable?"

We should develop all sources of renewable energy. All have their difficulties, especially biofuels. The biofuels or biomass sector is quite different from all the others, in the sense that you have an energy source you're producing. Water, fuel, it's completely different.... The way [biofuels have] been treated in the European Union with the recent directive, where the EU [sets] a certain level of sustainability criteria for renewable energy-that is the way forward.... Also, [the issue of biofuels] has to do with availability of water, the kind of cultivation you use, etc. These are very complicated stories, much more complicated than other [renewable energy sources] because the others are mainly a technology you want to develop.... Still, [biofuels] have their importance, and it is very important to develop them for the future, but in a sustainable way.

New Energy Finance predicts that 2009 investments in the clean energy sector will be 26-39 percent less than last year's total of $155 billion. How will the renewable energy sector fare by the end of the year?

It's very difficult to foresee the future. It's clear that the financial crisis has affected the wind energy sector and renewable energy in general, mainly through financing difficulties. It's positive that we have not seen projects being abandoned. We have seen projects that have been delayed. It's clear that, for me, in 2009 we are not going to have the development growth rate we had in previous years. I still am confident that it will not be lower than last year.... I believe [the sector] will, more or less, at the end of this year be equal to new installations of last year-maybe a 15-percent increase.

It depends on a few markets. It depends on the United States, which is a very big market this year. It looks like it's going to go down with respect to last year but hopefully not very much. Developments in China continue to be quite strong. It looks like they are going to have a big increase this year with respect to last year. Europe is going to be down a little bit.... The U.S., Europe, and China define global installations. If we speak specific countries, for sure countries will have fewer installations than last year....

I expect renewable energy to be one of the sectors that leads the [global economic] recovery. It will catch up very quickly when the economy recovers and will continue to develop with growth rates you have seen in the past. But for a couple of years, it is not going to be the same.

What role will IRENA play in renewable energy's recovery?

The creation of IRENA is very important. It can really be a catalyst of development of renewable energy globally. If the organization is set up correctly-which is not evident yet, we'll have to see if it works-and if everything goes well, it's going to help accelerate the development of renewable energy. Because the development of renewable energy is coming. It's there. The question is: What is the rate of development? How fast do we go? There, IRENA can play a really critical role.

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jdiamond@worldwatch.org.

Interview with IRENA Director General Nominee Hans Jǿrgen Koch

Ben Block — Wed, 24 Jun 2009 13:54:46 -0400

Wind and solar power and other "new" renewable energy sources provide Denmark with more electricity, on a percentage basis, than any other country. This accomplishment can be attributed in large part to the work of Hans Jǿrgen Koch. For more than 30 years, Koch has worked in the Danish Energy Ministry where he now serves as deputy permanent secretary of state in the Ministry of Climate and Energy. He left the ministry in 1994 to spend eight years at the helm of the International Energy Agency, where he helped found the IEA's Renewable Energy Unit.

Koch is one of four nominees to head the new International Renewable Energy Agency (IRENA). IRENA members are meeting this weekend in Sharm el-Sheikh, Egypt, to choose a headquarters and select a director-general. Worldwatch staff writer Ben Block is interviewing candidates this week for Eye on Earth.

BB: What factors enabled Denmark to increase its renewable energy share to 17 percent of total energy?

HJK: A carefully designed, long-term, stable energy policy based on broad support in the parliament and in the general public. A policy that has created ownership for the most important actors among utilities, manufacturers, and consumers. A policy containing a solid mixture of economic, tax, and regulatory incentives in favor of wind, biomass, and other renewable energy sources. A combination of liberalized Nordic electricity markets allowing for international trade, flexible support schemes, and a carefully designed national planning of markets for combined heat and power and district heating. And a careful monitoring and adaptation of support schemes in order to give incentives to continued increased competitiveness of the renewable technologies.

Could Danish policies be replicated in other countries? If so, what lessons should other countries heed from Denmark's example?

In principle, all of the above mentioned most important factors [could be applied elsewhere]. However, in some countries tax policies are probably politically non applicable.... It is important to create long-term investor confidence in the stability of the support schemes for research, development, demonstration, and deployment of a broad variety of renewable energy technologies.

What technology and financing policy lessons would you borrow from your experiences in Denmark and bring to IRENA?

My experience has been that it is important to look at the individual preconditions in countries and regions in order to determine which kind of support measures will be most effective.... Furthermore, it is necessary to monitor closely the development [of renewable energy] over time in order to scrutinize regularly whether the existing support measures are working in an optimal way. It is certainly not a question of just pouring more and more money at manufacturers. It is also a question of maintaining the incentive for manufacturers, for producers, for customers, to make renewable energy continuously more competitive and self-sustaining in competition with traditional sources.

Some say IRENA is unnecessary because of advances the International Energy Agency has made, very much under your leadership, to encourage renewable energy development. How do you envision the relationship between the IEA and IRENA?

The IEA is an indispensable intergovernmental organization, not only for emergency preparedness but also for producing neutral, unbiased analysis in all areas of energy policy and technology. IEA has a solid track record for world-class analysis. But the problem for IEA is that renewable energy, in the IEA regular budget is only 2 percent. That 2 percent corresponds to $500,000 per year. It is a very limited amount of money...

The work IEA is doing on renewable energy is in general first-class. However, the amount of money allocated to renewable energy is far, far too small to really make substantial progress with the tasks we are facing.

Another reason why the IEA by nature is insufficient is that IEA is not a truly global organization. It is a precondition for a government to be a member of IEA, that the country is a member of the OECD [Organisation for Economic Co-operation and Development]. Nobody expects in the foreseeable future to seat countries like Russia, India, China, Brazil, Indonesia as members of OECD. There are therefore huge parts of the world with huge ambitions for increased utilization of renewable energy, which will be more or less out of reach for the IEA.

Why is it so "impossible" to expand the IEA budget for renewable energy?

There's no reason to believe that, when for 25 years in a row the IEA has not been willing to increase its total budget in real terms, it will be willing to do that in the foreseeable future.... IEA also has to cover, for instance, emergency preparedness, oil, coal, gas, electricity, and energy efficiency. It is very difficult to move parts of the budget to renewable energy without coming below a critical mass in other areas where the agency also wants to be active.

Should IRENA promote specific renewable energy policies?

It is probably necessary to have a broad variety of policies. What is useful in one country or region might not be useful in other countries or regions. That means that an important part of the work on IRENA will be to disseminate information about success stories, to [present] stories on what works under certain conditions and also what does not work under certain conditions.

Under what conditions, and to what extent, should renewable energy be subsidized?

It is still necessary to some extent to subsidize renewable energy. There are a number of good reasons for this. One reason is that there are still lots of subsidies for fossil fuels around the world. Another reason is that the market forces do not respond sufficiently to the environmental and climate-related economic benefits of renewable energy. A third reason is the economic benefit of investing in technologies for indigenous, renewable energy supply instead of [transfering] huge amounts of funds to fuel-exporting countries.... For many developing countries, the increase in fossil fuel prices [has] cost...more than the development assistance they have received. A fourth and very obvious reason to subsidize some renewable energy technologies is that some of the technologies still are at very early stages and therefore need support in the same way as, for instance, nuclear and gas turbines got in early stages of their development.

Should IRENA assist in the development of cross-boundary renewable energy projects? If so, how?

First of all, it should be up to the individual member countries to decide what kind of advice, if any, they want to receive from IRENA. But for some sources of renewable energy, for instance hydro and wind, cross-boundary energy projects would be very useful. The renewable resources are not always there where you need the energy the most. And, for instance, wind energy and hydro energy can complement each other in a very effective way.... Denmark has no hydropower, yet it is very well complemented by hydropower in Norway. When wind is not blowing in Denmark, we can trade with Norway.

How should IRENA address controversial sources of energy such as biofuels? Do you consider biofuels to be "renewable?"

Biofuels are renewables. They seem to some extent to be considered as controversial. However, I am convinced, based on experiences in Brazil and many other countries, that there is a huge potential for biofuels that can be utilized under high sustainability requirements. I am convinced that there is a large scope for biofuels being produced without problems for food supply and without leading to negative effects on the environment, in relation to rainforests. Brazil in general is a good example [of the] huge potential for how biofuels can be used in a 100-percent sustainable and respectable way.

IRENA Politics May “Taint” Agency, Advocates Say

Ben Block — Tue, 23 Jun 2009 10:41:28 -0400

Advocates of the International Renewable Energy Agency, the first multi-government body to focus exclusively on the global development of renewable energy sources, worry that competition among member countries to host the agency may detract from its core mission.

The agency, known commonly as IRENA, has quickly gained recognition since its launch in January, with the endorsement of more than 100 countries . The United States, United Kingdom, and Australia have yet to officially sign on but are expected to announce their support at a summit next week in the resort town of Sharm el-Sheikh, Egypt.

The meeting will decide where IRENA will be headquartered and who will serve as its first director-general - issues that have already sparked controversy.

Competing host countries are facing accusations of attracting votes with political favors such as military support or investments in non-renewable energy sources. These concerns are prompting clean energy advocates to mobilize their supporters to demand that international politics not interfere with IRENA's agenda.

"The reason we want IRENA is because the existing organizations are too much involved in the interests of the fossil fuel or nuclear sector.... We need an independent authority," said Stefan Gsänger, secretary general of the World Wind Energy Association. "If there is a chance from the beginning that IRENA is bound to these interests, [the agency] might be at the end useless or even detrimental."

IRENA was created to provide advice on renewable energy policy, capacity building, and technology transfer to governments worldwide. Housing the agency would likely boost the selected city's economy with an increased flow of diplomats and energy leaders. The chosen country would also be able to market itself as an environmentally conscious supporter of renewable energy.

Germany, Austria, Denmark, and the United Arab Emirates (UAE) have all offered to host the agency. The competition has escalated in recent weeks with an intense lobbying campaign.

The UAE, which nominated to host the headquarters in Abu Dhabi, is running a public relations website and actively requesting political leaders to support its candidacy. The country committed $22 million of annual support for IRENA through 2015. In addition, the Abu Dhabi Fund for Development has offered $50 million in annual loans to finance renewable energy projects in developing countries.

Locating IRENA in Abu Dhabi has gained support from former UK Prime Minister Tony Blair, who praised the oil-exporting country's investments in renewable energy. The UAE is developing the world's first carbon-neutral city, known as Masdar City.

"Locating IRENA in the developing world would send a powerful signal that all nations must participate in the transition to a sustainable future," Blair said during a recent trip to Abu Dhabi, according to Gulf News.

Some renewable energy advocates, while praising UAE efforts to develop alternative energy sources, oppose locating the headquarters in a country powered nearly entirely by natural gas and oil. Abu Dhabi plans to rely on renewable energy sources for 5-7 percent of its electricity by 2020.

The other leading city, Bonn, has also faced criticism. Those who oppose the former West German capital say that the city wants to host IRENA mainly to fill government buildings that were abandoned when the capital was relocated to Berlin.

But like the other nominated cities - Vienna and Copenhagen - Bonn generates a greater share of its electricity from renewable resources than Abu Dhabi. The contending European countries also support renewable energy through their foreign-aid budgets.

Dörte Fouquet, director of the European Renewable Energy Federation, a lobbying group for independent electricity producers, favors locating the IRENA headquarters in a city that has been a longstanding example of renewable energy.

"[Abu Dhabi's] per capita energy consumption is among the highest in the world," Fouquet said. "On the other hand, they just started with renewable energy."

In addition, Fouquet criticized the UAE for its human rights record and its recent partnerships with nuclear-promoting countries.

The UAE reached agreements last month with the United States and France to develop several nuclear reactors to meet the country's expected 40,000 megawatts of additional electricity demand by 2017. France also opened its first Persian Gulf military base last month in Abu Dhabi.

Eric Martinot, lead author of the REN21 Renewable Energy Global Status Report and a Worldwatch Institute senior fellow, said that if Abu Dhabi is selected as the IRENA headquarters, these deals would create a "nuclear-tainted" IRENA.

"UAE has expressed its intentions to rapidly become a ‘model' for promoting nuclear power," Martinot wrote in an open letter to renewable energy supporters. "[Choosing Abu Dhabi] raises the question of whether IRENA will be an effective change agent for renewables (i.e. promoting renewables instead of nuclear power), or will be merely an appendage to a nuclear agenda."*

The location of IRENA would not necessarily determine the agency's fate. Hans Jørgen Koch, the Danish nominee to serve as director-general, said that the chosen headquarters would be unlikely to "taint" the agency.

"If IRENA is based in Abu Dhabi, it does not give Abu Dhabi any right to decide whether nuclear is included in IRENA," said Koch, who formerly directed the International Energy Agency's renewable energy office.

Debate over where IRENA should be centered is distracting renewable energy advocates from IRENA's core mission, said Mike Eckhart, president of the American Council on Renewable Energy.

Instead of choosing one location, Eckhart recommends that IRENA become a "centerless" organization based in 5-10 regional headquarters. The regional hubs would work with colleges and universities to create educational courses based on that region's renewable energy supplies.

"Unlike oil, which has a world oil market and a single International Energy Agency, the nature of renewable energy is that there are no global answers, only regional and local answers," Eckhart said.

But a decentralized structure may be too complicated to manage, said Arthuros Zervos, the Greek nominee to serve as IRENA's director general. For IRENA to develop into a global energy authority such as the IEA or International Atomic Energy Agency (IAEA), the agency should begin with a central headquarters, he said.

"When [IRENA] is running for several years, starting regional offices, or whatever you want to call it, yes, I could see it would be helpful," said Zervos, who chairs the Global Wind Energy Council. "[But] starting as a decentralized structure, I do not agree at all."

Eckhart has also proposed that the Sharm el-Sheikh meeting not vote on a headquarters at all. A vote should take place when more countries officially join IRENA, he said.

"We're going to have additional members joining who will have no choice in director-general or its location. That's extremely inappropriate to me," Eckhart said.

The IRENA founding treaty had been signed by 108 countries as of Tuesday. The treaty becomes effective when 25 countries ratify the agreement.

The United States, United Kingdom, Australia, and Malta have announced their intent to sign the treaty, according to a German delegation report submitted to the Council of the European Union earlier this month.

* Eric Martinot's comments do not reflect the views of the Worldwatch Institute, nor any organization with which he is affiliated.

China Reports 66-Percent Drop in Plastic Bag Use

Ben Block — Thu, 18 Jun 2009 15:33:44 -0400

A strict Chinese limit on ultra-thin plastic bags significantly reduced bag-related pollution nationwide during the past year. The country avoided the use of 40 billion bags, according to government estimates.

Plastic bags are commonly found in waterways, on beaches, and in other "unofficial" dumping sites across China. Litter caused by the notorious bags has been referred to as "white pollution."

The State Council, China's parliament, responded in January 2008 by prohibiting shops, supermarkets, and sales outlets from providing free plastic bags that are less than 0.025 millimeters thick.

The State Administration of Industry and Commerce also threatened to fine shopkeepers and vendors as much as 10,000 yuan (US$1,465) if they were caught distributing free bags.

In its first review of the ban, the National Development and Reform Commission (NDRC) announced earlier this month that supermarkets reduced plastic bag usage by 66 percent since the policy became effective last June. The limit in bag production saved China 1.6 million tons of petroleum, the NDRC estimated.

Prior to the ban, an estimated 3 billion plastic bags were used daily across China, creating more than 3 million tons of garbage each year. China consumed an estimated 5 million tons (37 million barrels) of crude oil annually to produce plastics for packaging.

The China Chain Store and Franchise Association undertook an analysis of the ban as well. The association announced earlier this month that foreign-owned and local supermarkets reduced plastic bag usage by 80 and 60 percent, respectively.

"Supermarket consumers are used to bringing along shopping bags and reusing plastic bags," an association statement said. "The awareness of environment is enhanced. The declined usage of plastic bags has no negative effect on the sales of supermarkets."

But compliance with the ban appears to be inconsistent across the country. A survey by Global Village, a Beijing-based environmental group, found that more than 80 percent of retail stores in rural regions continued to provide plastic bags free of charge.

The survey also found that nearly 96 percent of open food markets throughout Beijing continued to provide bags. The policy exempts the use of plastic packaging for raw meat and noodles for hygiene and safety reasons.

The commerce administration enforced the ban through a 600,000-strong army of regulators who inspected some 250,000 retail stores or markets, according to China Daily. The regulators dispensed about 2 million yuan (US$293,000) of fines.

Suiping Huaqiang Plastic, a 20,000-employee bag manufacturer, experienced the ban's economic effects almost immediately. The company went out of business last year, soon after the government announced the plastic bag policy.

Despite backlash from the plastics industry, numerous countries and cities worldwide have adopted bag limits in recent years. Mumbai, India, banned thin plastic bags in 2000 to prevent garbage from clogging storm drains during monsoon season. Bans or taxes have since been adopted in localities including Australia, Ireland, Italy, South Africa, and various U.S. cities. In Tanzania, selling a thin plastic bag risks the maximum penalty of six months in jail and a 1.5 million shilling (US$1,170) fine.

Depnding on its composition, plastic debris can require more than a century to decompose, gradually breaking down into smaller pieces over time. The Pacific Ocean is home to a floating heap of debris estimated to be twice the size of France and to weigh at least 3 million tons.

The world's plastic debris and other refuse is often digested by wildlife and kills an estimated 1 million seabirds per year, according to the United Nations Environment Programme (UNEP). The agency reported earlier this month that plastic, especially plastic bags and polyethylene terephthalate (PET) plastic bottles, accounts for more than 80 percent of marine litter, the most common source worldwide. The report was the first assessment of marine debris in the world's 12 major sea regions.

Plastics can also damage boats, fishing gear, and agricultural facilities. Phasing-out thin plastic bags at the source is often regarded as a cheaper alternative than removing the debris later by hand or machine, UNEP said.

UNEP Executive Director Achim Steiner has recommended that all countries ban thin plastic bags. "Some of the litter, like thin-film single-use plastic bags which choke marine life, should be banned or phased-out rapidly everywhere," Steiner said in a statement earlier this month. "There is simply zero justification for manufacturing them anymore, anywhere."

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jdiamond@worldwatch.org.

Climate Change Melts the Rockies

admin — Wed, 17 Jun 2009 08:29:00 -0400

Washington, D.C.-A perfect storm in the Rocky Mountains driven by population growth, a warming climate, and economic development has put both the region's ecosystems and its economy in jeopardy, according to the latest issue of World Watch magazine.

"If the Rocky Mountain states want to continue to see growing, robust economies and levels of personal income as well as the quality of life that is so appealing, then the smart money is on investing to protect natural, amenity-producing areas throughout the region from the impacts of spreading development," writes Lina Barrera, who examines the ways in which a changing climate is affecting this vast mountain range and its surrounding areas in the first installment of the World Watch occasional series "Portraits of Climate Change."

The average winter temperature in the U.S. West has risen roughly 1.4 degrees Celsius over the last century. Residents have witnessed the manifestations of this change in smaller mountain snowpacks, an increase in rainfall over snowfall, and a rise in winter lows.

These changes put many species with specific habitat and temperature needs at risk, but they also threaten to destroy the very natural areas that are sustaining the region's economic prosperity. Energy development, water scarcity, and growing populations all have the potential to stall the steady growth this region has enjoyed to date.

“Black Carbon” Chokes Chilean Towns

Jane Zhou — Tue, 16 Jun 2009 19:00:32 -0400

On winter nights, Carmen Ahumada is unable to see across the street to her neighbor's house. Visibility in Temuco, Chile, can be as low as five meters at times, she said.

Temuco, with a population of 300,000, has the fourth most polluted air in the country, according to local media. The burning of firewood for heating, cooking, and other uses is the main source of soot particulates, known as "black carbon," that enter the air at levels 150 percent higher than the national standard and more than four times the World Health Organization's recommended limit.

In 2008, Temuco violated Chilean air pollution laws on 34 days, three times the number of days as in 2004.

Cold weather conditions, especially at night, trap urban air pollution near the ground, cloaking Chile's urban areas in thick smog. The problem worsens during the winter, when lower temperatures and poor home insulation ratchet up the amount of firewood burned.

"There are a lot of people here who suffer because of the pollution. The government promises and promises to help," Ahumada said. "The day arrives, and nothing happens."

On many counts, Chile has taken the lead in Latin America in tackling urban air pollution. But little has been done to help smaller towns address particulate pollution from firewood burning, which supplies 20 percent of the country's energy, according to local residents and officials.

Firewood use in the world's poorest regions has been recognized as a contributor to local air pollution, public health concerns, and more recently global climate change. Yet even in Chile, the most prosperous nation in South America, locals are struggling to overcome the effects of black carbon.

About a third of the world still burns wood and other biomass for cooking, heating, and lighting, accounting for 13 percent of global energy consumption. But burning does not completely break down the wood, resulting in the release of particulate matter into the environment. The soot contains carbon monoxide, heavy metals, and carcinogenic dioxins such as benzene and formaldehyde.

Detrimental health effects have been well documented and include asthma, respiratory infections, decreased lung function, malnutrition, cardiovascular disease, and cataracts. Such effects are particularly harmful to the elderly, young children, and the poor, according to researchers.

"I don't think it's an exaggeration to call [an indoor firewood stove] a toxic waste plant," said Kirk Smith, a global environmental health professor at the University of California at Berkeley who has studied the health effects of wood stoves in India and Central America.

A Chilean national health commissioner has warned that poor air quality conditions may increase the risk of swine flu and other current health challenges, with the situation potentially exacerbated in small towns like Temuco.

The Intergovernmental Panel on Climate Change (IPCC), the leading international body of climate scientists, concluded in its 2007 assessment report that burning firewood may affect the global climate as well. When soot settles on light-colored snow or ice, it reduces the capacity of these surfaces to reflect sunlight and contributes to atmospheric warming.

"It doesn't matter if it's a fossil fuel or a biomass fuel, it all contributes to the problem," said Smith, who is researching the use of more-efficient wood-burning stoves for health and climate reasons.

Some scientists have argued that black carbon's warming effect is greater than the IPCC estimated. The particulates are possibly the second most significant greenhouse gas after carbon dioxide and three times more potent in its climate-altering effects, recent studies said [PDF].

Burning firewood as an energy source often contributes to increased levels of deforestation, adding to climate concerns. In Chile, however, forest cover is on the rise, according to the World Bank.

Chile began fighting worsening air pollution in the 1990s in Santiago, the country's capital and home to half the national population. Since then, sulfur and nitrogen pollution have decreased significantly, but particulate matter remains a problem because of increasing population and vehicular traffic.

In Coyhaique, the city that recently ranked the worst in particulate air pollution, 97 percent of residents burn firewood. Firewood in Chile is four times cheaper than paraffin, five times cheaper than natural gas, and seven times cheaper than electricity. Most homes, including Ahumada's, are not equipped for other types of heating systems and are poorly insulated.

In Temuco, where 85 percent of residents burn firewood, the government began measuring local air pollution levels only in 2002. Three years later, the urban area of Temuco-Padre Las Casas was declared a "zone of saturated pollution." Apart from municipal efforts to promote more sustainable burning methods, no official policies regulate the use of firewood.

"In Chile, firewood actually isn't recognized as a fuel [by the government] despite being the second largest source of energy in the country," said Rony Pantoja, regional technical secretary of the National Firewood Certification System (SNCL), a partnership formed in 2005 between firewood dealers and the government. "There are no policies that modernize and make sustainable [firewood] use.... It gives the impression that this issue doesn't interest [the national government in] Santiago."

The Chilean Senate Committee on Mines and Energy met with SNCL in May to discuss addressing firewood management issues. The partnership with SNCL encourages firewood dealers to sell drier wood, which lessens the release of harmful particulates into the air. For a nominal fee of 200 Chilean pesos (35 U.S. cents), sellers receive an official label that they can display to indicate their firewood's quality. By comparison, a cubic meter of wood costs 15,000-22,000 pesos.

Yet local, regional, and state governments have failed to cooperate widely, Pantoja said. As a result, less than 3 percent of publicly purchased wood, including that used in schools, government offices, and even local health agencies, was certified by SNCL, El Mecurio reported in 2008. A year later, the share has risen to 34 percent, Pantoja said.

SNCL's goal is not to impose binding firewood standards on anyone, but to encourage sellers and consumers to be more aware of the issues and to demand higher quality wood, Pantoja said. He hopes one day to establish a Certified Firewood Supply Center that would help improve poor residents' access to quality firewood.

"There's an important part of the population that doesn't have much purchasing power, those who live practically day to day," Pantoja said. "For them, it's difficult to get quality firewood. We yearn to establish a social supply center for certified firewood, but for this we need the support of more institutions. We can't do it alone."

Both urban and national population growth in Chile have held steady at around 1 percent for several years, and air quality is improving, according to the World Bank. But environmental remediation efforts have been concentrated mainly in Santiago and have only recently spread to secondary cities. Meanwhile, smaller municipalities like Coyhaique and Temuco are among the most rapidly growing urban areas in Latin America and face the greatest sustainable development pressures.

For residents of polluted towns, the pace of politics is not enough. The regional decontamination plan issued by Chile's National Commission of the Environment (CONAMA) allotted 30 million pesos (US$53,250) to help with improving fuel quality, replacing heating technology, and beefing up home insulation. These funds, however, will be dispersed in projects taking place only over the next 10 years.

"I have just enough for water, light, cooking, and buying the things I need," said Ahumada, who lives on about US$266 per month. "CONAMA has promised for two years to help out, but there is no help at all."

Jane Zhou is an intern with the Worldwatch Institute. She can be reached at jzhou@worldwatch.org

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jdiamond@worldwatch.org.

Climate Debate Overlooks Small Businesses

Ben Block — Mon, 15 Jun 2009 11:23:51 -0400

As the United States debates how it should tackle climate change, "Big Business" has generally received the most political attention.

Small companies are mostly disengaged from the climate debate, businesses advocates say, yet environmentally conscious, small enterprises could become influential supporters of climate legislation.

"Small business has to be a strong constituency if this legislation is going to be passed," said Scott Hauge, president of Small Business California. "If we are going to create the innovation, we are going to create the jobs, we are going to reduce energy use, there needs to be a concerted focus on small business."

World leaders will craft an international treaty to avoid the most catastrophic effects of climate change this December in Copenhagen, Denmark. Whether the United States can agree on climate change policy in the coming six months will heavily influence the outcome of the Copenhagen negotiations.

The Pew Charitable Trusts revealed last week that the U.S. clean energy economy - more than 68,000 companies that supply clean energy, energy efficiency, conservation strategies, and pollution mitigation technologies - created 770,385 jobs in 2007.

Many of these "green jobs" are small businesses, defined as an employer of 500 workers or less, according to The Center for Small Business and the Environment. In a report also released last week, the Center's Executive Director Byron Kennard said that the 27 million small businesses in the United States, which produce 51 percent of private sector output, are turning to environmentally beneficial services in greater numbers.

"These are not tree hugger prophesies. These are real businesses, taking real risks, creating real jobs," Kennard said. "Economically, politically, and socially as well, these green businesses are having a real impact."

Despite the growing contribution of small eco-entrepreneurs to the economy, no studies have measured how climate change legislation would specifically affect U.S. small businesses, Kennard said.

"Small business is always ignored," he said.

The U.S. House of Representatives is debating the American Clean Energy and Security Act, a bill that promises to reduce U.S. carbon emissions 17 percent by 2020 and 83 percent by 2050, compared to 2005 levels, through a national cap-and-trade system.

In addition to placing a price on carbon, which would benefit low-carbon businesses, the legislation would increase energy efficiency standards, establish national mandates for renewable energy, and boost clean energy research.

The current version allows industrial polluters - businesses that emit more than 25,000 tons of carbon annually (such as large electric utilities, natural gas distributors, and cement producers) - to receive about 80 percent of the cap-and-trade system's emission permits for free. The remaining would be auctioned, often to polluters. These funds are intended to assist consumers with higher energy costs, avoid deforestation in tropical countries, research clean-energy technologies, help developing countries adapt to climate change, and deploy clean energy-technologies worldwide.

The bill would also form a worker assistance and job training program, which supports reducing businesses' dependency on fossil fuels. The program would be funded with roughly 0.5 percent of the permit auction funds. Commercial buildings would also be entitled to some of the legislation's financial support for weatherization programs.

Scott Sklar, steering committee chair of the Sustainable Energy Coalition, a group of national and state-level business, environmental, consumer, and energy policy organizations that promotes increased federal support for energy efficiency and renewable energy, said the legislation's benefits for small businesses are too small to provide meaningful support. He criticized the bill for prioritizing large industry instead.

"I don't think any iterations of the [climate] bills I've seen so far support small businesses," said Sklar, president of The Stella Group, a renewable energy marketing firm. "The allowances are given to big business polluters for the most part."

Molly Brogan, vice president of public affairs with the National Small Business Association, said many of her members are supportive of addressing climate change, but they are also concerned that the cap-and-trade system would create a complicated regulatory burden. Without a reliable study on how the bill may affect small businesses, especially financially, the association has not formed an official position.

"We're having such a hard time figuring out if we like this bill because it's been so hard to know quantitatively and qualitatively how it will affect our members," Brogan said.

Michael Diegel, media director for the National Federation of Independent Business (NFIB), is concerned that in regions where energy costs may rise-particularly in coal-reliant Midwestern states-public utility companies and large-scale manufacturers may pass the price burden onto consumers, including small businesses.

"An NFIB member in Pennsylvania runs four athletic clubs and relies heavily on electricity and natural gas to power the heating-ventilating-air conditioning system and lighting the facilities," Diegel said in an e-mail. "His energy costs run about $600,000 a year. If it goes up 40 percent - $840,000 - he says his only choice will be to close his business."

California industries used similar arguments in an unsuccessful effort to derail the state's cap-and-trade bill. Upon realizing that small business owners were likely to support the legislation if businesses could improve their energy efficiency, legislators responded with a small business toolkit. The program guides businesses on how to reduce their energy costs (and therefore greenhouse gas emissions) through voluntary efficiency gains.

"By small business stepping up to give the voice to our position, we were heard," said Hauge, who helped pass the bill in 2006. "Big business was not aligned."

But Kennard said that without a better understanding of whether small businesses would receive immediate benefits or economic trouble, support for national climate legislation is unlikely.

"Small business owners are turned on to energy efficiency. They love green jobs," he said. "But cap-and-trade smacks of regulation. They get up and walk out of the room."

Ben Block is a staff writer with the Worldwatch Institute. He can be reached at bblock@worldwatch.org.

This article is a product of Eye on Earth, Worldwatch Institute's online news service. For permission to reprint Eye on Earth content, please contact Juli Diamond at jdiamond@worldwatch.org.