Sunday, August 9, 2009

Goldman Sachs: "New Carbon Market Presents Major Opportunity"

A recent Goldman Sachs report on the Waxman-Markey climate bill confirms it would result in one of the largest commodity markets in the world subject to significant speculation and have relatively marginal impacts on the renewable power industry.

A Goldman Sachs report on the Waxman-Markey climate bill, recently issued to Goldman Sachs' clients, confirms Breakthrough Institute analysis showing the legislation would result in one of the largest commodity markets in the world subject to significant speculation by financial firms, and would have relatively marginal impacts on the renewable power industry.

Titled "Carbonomics: Measuring impact of US carbon regulation on select industries" (not publicly accessible), the report concludes that "A new carbon market presents a major opportunity for exchanges and clearinghouses, especially as more allowances and offsets trade over time."

In a section titled "Carbon exchanges -- build it, and they will (must) come to trade," it estimates the bill would grow the global carbon market to become one of the largest in the world, with trading volume of 175 to 263 million contracts per year -- larger than the oil and gas markets combined and approximately the third largest commodity market in the world after U.S. interest rates and stock indexes. The analysts estimate the profit margin for financial firms resulting from this new carbon market could reach $2 billion per year globally.

Read the full story ............more

Pressure build-up during CO2 storage in partially confined aquifers

YagnaDeepika Orugantia and Steven L. Bryant

"As the number or proximity of faults increases, the injectivity decreases slightly. In contrast to injectivity, contours of elevated pressures are sensitive to faults. They extend farther as the number or proximity of faults increases, increasing the area of influence and thus the risk of failure (seal fracture, fault activation) significantly. Thus well placement relative to known faults is an important design consideration. The effect of aquifer depth on pressure build-up due to injection is also investigated. The variation of fluid viscosity with pressure and temperature (brine viscosity is much more sensitive than CO2 viscosity) is the dominant effect on injectivity and pressure build-up. An important overall message is that contours of elevated pressure extend much farther into the aquifer than the CO2 plume itself. Thus risk assessment that focuses exclusively on CO2 may underestimate actual project risk."

The link to this abstract is here

Strong Oppostion to CO2 storage project in Denmark

A group of landowners in northern Jutland have collectively dug in their heels to stamp out a power company’s plans to establish a giant underground carbon dioxide storage chamber in Jammerbugten.

The power company has been promoting the argument that carbon dioxide is no more harmful than water and insists the resident have nothing to fear from the project. Vattenfall also points out that the European Union has indicated it wants 10-12 full-scale CCS projects at power plants across the continent within the next few years.

But even scientists at the Geological Survey of Denmark and Greenland are at odds over the process.

Villy Fenhann, senior researcher at GEUS, is one of those who believes CCS diverts money from other, more viable climate solutions, such as renewable energy and energy efficiency.

‘We should be investing in the most environmentally friendly solutions and not in a method that is 50 percent more expensive,’ said Fenhann. ‘I wouldn’t feel safe with a CCS chamber in my backyard, either.’

Yet Fenhann’s colleague at GEUS, Thomas Vangkilde-Pedersen, said he didn’t see any danger with the project and that Jammerbugten was a perfect area to begin a new pilot.

But about 25 landowners in the area have now united under the banner ‘No to CO2 Storage Association’ to fight the project.

Vattenfall has offered Jammerbugten landowners 3,700 kroner each plus 1,000 kroner per hectare in compensation to get them ‘on side’ with the project. So far, 306 area residents have agreed to the project.

But according to the association of landowners opposed to the project, Vattenfall has also threatened to use the expropriation law to get around those who refused.

05/08-2009 Read more at The Copenhagen Post.