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A diverse bunch of economists, commentators, free-marketers and even Exxon’s chief think that a carbon tax is better than a cap-and-trade scheme. The argument mostly goes that it is simpler, cheaper to administer, and by providing more certainty over the price of carbon, it gives businesses a stronger incentive to invest in low-emission technologies and infrastructure.
The problem is, the idea of a whole new tax is basically a political ‘third rail’ – and talking about externalities won’t very likely reverse that. But France is planning to introduce a carbon tax anyway. Well, perhaps. Read more
Saudi Arabia’s prince Turki al-Faisal is not impressed by talk of energy independence in the US.
Reuters, via Yahoo, quotes an article Prince Turki wrote for Italian newspaper Il Sole 24 Ore, which the newswire says was translated into Italian (and then, presumably translated into English by Reuters). Read more
We now have the results of the study by the Copenhagen Consensus – a group of economists brought together by Bjorn Lomborg, author of The Sceptical Environmentalist – showing which options for averting dangerous climate change they judge to offer the best value for money. Five economists – Finn Kydland, Thomas C. Schelling, Vernon L. Smith, Nancy L. Stokey, and Jagdish Bhagwati (the first three are Nobel laureates) decided the rankings.
Here are they are in full:
1. Marine Cloud Whitening Research – methods for increasing the reflectivity of clouds, for instance by spraying seawater into the air. Whiter clouds would mean more of the sun’s rays reflected back into space, but some scientists fear it could cause unintended consequences such as a lack of rainfall in regions such as the Amazon.
2. Energy R&D – we need much more research into new forms of energy, the group concluded.
3. Stratospheric Aerosol Insertion Research – shooting particles such as sulphates into the highest reaches of the atmosphere. This would mimic the actions of volcanoes, which are known to cool the climate as the particles they send into the atmosphere reflect sunlight away from earth. But would it also cause acid rain? Or changes to rainfall patterns?
4. Carbon Storage Research – the science of capturing and storing carbon dioxide is still in its infancy. Read more
Amid the coverage of Brazil’s new oil legislation earlier this week, we noticed this at the end of an Oil & Gas Journal report: a Brazil-based Credit Suisse analyst, Emerson Leite, revised down estimates for oil in the Santos presalt basin from 50bn to 28.2bn barrels.
According to Leite, the revision was necessary because the region is becoming clearer as more wells are drilled. He noted that in July two wells, drilled respectively on BM-S-22 and BM-S-52 blocks, turned up dry.
“The market tends to get used to more dry wells in the subsalt, given that no exploratory area has a rate of 100% success,” he said.
Libya’s decision to require foreign companies to appoint Libyan chief executives to their joint ventures will come as unwelcome news to oil and gas companies investing there – if the past few weeks haven’t already done so. The country has held four bidding rounds for its substantial oil reserves since UN and US sanctions were lifted earlier this decade, but the furore over the transfer of Lockerbie bomber, Abdul Baset Ali al-Megrahi, from Scotland to Libya highlights the political delicacy for oil companies doing business in Libya.
In a striking example of this, The Times reports today that a consultant for BP spoke to British Justice Secretary Jack Straw on the subject in 2007 – with BP reportedly confirming it did raise concerns over delays in progress of a prisoner transfer agreement. Read more