MAC: Mines and Communities

Norway plans major domestic "cleanups" - but still maintains investments in coal

Published by MAC on 2010-02-23
Source: PlanetArk

A Post-Copenhagen update

The Norwegian government is less equivocal than many others when it comes to addressing the country's rising contribution to global greenhouse gas emissions - fixing a relatively tough target for reducing those emissions, by up to 40%, over the coming decade.

But then, Norwegians enjoy (in conventional terms) the highest standard of living of any citizens on the planet - thus, even the "deepest cuts" wouldn't force them into  poverty.

The country's domestic energy derives predominantly from massive sources of hydropower. Its offshore oil and gas revenues have built into the world's second biggest sovereign wealth (pension) fund which, in turn, reaps impressive dividends on hundreds of overseas investments.

But it's something of an anomaly that many of these investments are in dirty coal companies, mining in China, the US, Indonesia and elsewhere. So far, addressing mitigation of the GGE from these mines doesn't seem high, if at all, on the government's agenda.

Norway's environment minister recently proposed that the state not buy carbon "offsets" overseas (although it's more than enough cash to do so). This will no doubt be welcomed by those who believe that carbon permit trading is a false and fraudulent means to cope with adverse climate change.

Norway Outlines Ways To Reach Deep 2020 CO2 Cuts

Alister Doyle, Environment Correspondent


18 February 2010

Norway Outlines Ways To Reach Deep 2020 CO2 Cuts Photo: Wojciech Moskwa
A windmill stands next to the ocean in Utsira, a North Sea island of just 6 square kilometres (2.3 square miles) and home to 210 people who already get most of their power from two onshore windmills, in this photo taken April 22, 2008.
Photo: Wojciech Moskwa

OSLO - Norway laid out ways to reach one of the world's toughest climate goals on Wednesday with measures to clean up sectors from oil to transport that it said would trim just 0.25 percent from the economy by 2020.

The "Climate Cure," outlined by state-run agencies to guide deep cuts in greenhouse gas emissions, said costs would range up to 1,100 to 1,500 crowns ($188-$256) per tonne of avoided carbon dioxide emissions.

That is way above a current price of about 13 euros ($17.85) per tonne in the European Union market. Even so, one main scenario in the 300-page report projected only a 0.25 percent cut in the projected size of the oil-dependent economy by 2020.

"It means we'd be as rich by Easter in 2020 than we would otherwise be at Christmas" in 2019, Environment Minister Erik Solheim said of the small cut.

The impact on growth would be modest partly because penalties for emitting carbon would bring in tax revenues that could boost growth in cleaner sectors. The report also assumed technological advances that would spur the economy.

"Let's start with the measures that are cheapest and simplest," Solheim said of the report, which will help design legislation for fighting climate change.

Using different assumptions, the U.N. panel of climate scientists projected in a 2007 report that tough measures to combat global warming could cost 3 percent of world economic growth by 2030.

Norway has set a unilateral goal of cutting emissions by 30 percent by 2020 from 1990 levels, and by 40 percent if other nations sign up for deep cuts as part of a new U.N. treaty to slow desertification, heatwaves, flooding and rising sea levels.

The targets are among the toughest in the world.

Carbon Capture

The report assessed measures such as capturing and storing greenhouse gas emissions from oil and gas installations, biofuels, more electric cars and energy efficiency in buildings. Among cost-effective measures were building cycle paths in cities to discourage car use.

Norway wants at least two-thirds of its cuts to be achieved domestically, rather than by a cheaper option of buying quotas on foreign markets or by investing abroad, for instance by protecting the Amazon rainforests or building wind farms.

Emissions have grown to 54 million tonnes from about 50 million in 1990. The report examined ways to cut between 15 and 17 million tonnes a year by 2020, including three million absorbed by pine forests.

Norway has no real economic problem in buying quotas if it wants -- it has a fund totaling $450 billion invested in foreign stocks and bonds built up from oil and gas revenues.

Deep cuts in Norway are likely to be more costly than in many other nations, Ellen Hambro, head of the Climate and Pollution Agency, told Reuters.

"We don't have coal-fired power plants to close," she said. Almost all of Norway's electricity comes from clean hydropower.

(Editing by Janet Lawrence)

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