tax exemption

Warning: the UK government’s hydrogen plan isn’t green at all, it’s another oil industry swindle

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Kevin Anderson and Simon Oldridge

Membrane type LNG tanker Puteri Firus Satu in Tokyo Bay. Author Tennen-Gas shares under GNU Free Documentation License.
Membrane type LNG tanker Puteri Firus Satu in Tokyo Bay. Author Tennen-Gas shares under GNU Free Documentation License.

https://www.theguardian.com/commentisfree/2023/dec/04/uk-government-hydrogen-plan-oil-industry-taxpayer-blue-hydrogen-climate-crisis

A taxpayer-funded drive for ‘blue’ hydrogen is good news for fossil-fuel lobbyists, but bad news for the climate crisisMon 4 Dec 2023 12.25 CET

With the impacts of the climate crisis so apparent for all to see, it is becoming ever harder for governments to fob off voters with promises of action tomorrow. At Cop28 we’ll see increasingly overt action by fossil fuel companies and petrostates to preserve their traditional power. But it is just as important to scrutinise emerging so-called green or low-emission solutions, which sound plausible, but are often simply big oil’s business-as-usual in a new guise.

The UK’s much touted low carbon hydrogen standard (LCHS) is an example of this. While hydrogen can be a low-emission fuel, the UK’s plan is quite clearly a fig leaf for “blue” hydrogen – which is made from fossil fuels – and according to one study, is even more at odds with our commitment to limiting global temperature rises to 1.5C than burning coal.

Today, the vast majority of the UK’s hydrogen production is made from natural gas (the marketing term for methane) in a very carbon-intensive process. Blue hydrogen would also be produced from methane, but with promises that the resulting CO2 emissions would be captured and buried underground. But even if most of the CO2 can be safely captured (a very big “if”), blue hydrogen’s full life-cycle emissions are likely still to be high.

That is in part as a consequence of methane leaks across the vast North Sea supply chain. Methane is a very powerful warming gas, so even with relatively low leakage rates, blue hydrogen will be bad news for the climate. Currently, 84% of the UK’s misleadingly named “low carbon” hydrogen capacity under development is of this blue variety.

Companies will be awarded substantial taxpayer funding for blue hydrogen plants that are certified compliant with the new LCHS – and here, the hallmarks of lobbying are only too apparent. The LCHS method for calculating life-cycle greenhouse gas emissions appears rigged to greenwash blue hydrogen.

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https://www.theguardian.com/commentisfree/2023/dec/04/uk-government-hydrogen-plan-oil-industry-taxpayer-blue-hydrogen-climate-crisis

Protest placard reads Greenwash detected
Protest placard reads Greenwash detected
Continue ReadingWarning: the UK government’s hydrogen plan isn’t green at all, it’s another oil industry swindle

FFS: Publically financed Fossil Fuel Subsidies

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Extinction Rebellion NL image reads STOP FOSSIELE SUBSIDIES
Extinction Rebellion NL image reads STOP FOSSIELE SUBSIDIES

https://www.climaterealityproject.org/blog/fossil-fuel-subsidies-public-finance

Like it or not, we’re all paying the fossil fuel industry to destroy the planet every time we do our taxes.

That’s right. Each of us is chipping in our hard-earned dollars [, Euros or Pounds], all to an industry earning billions in profits every year. One whose product is heating up our planet and sowing more and more climatic chaos the higher the thermometer rises.

We’re doing it through fossil fuel subsidies. And the time to end them is now.

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According to the International Monetary Fund (IMF), fossil fuel subsidies reached an all-time high of $7 trillion USD last year, costing the equivalent of over 7% of global GDP. To put it in more relatable terms, it’s “more than governments spend annually on education and about two thirds of what they spend on healthcare.” Fossil fuel subsidies rose by $2 trillion USD over the past two years alone.

Fossil Fuel Subsidies reached all time high of 7 trillion US Dollars

In general, most fossil fuel subsidies are implicit. This means that they fail to consider the negative externalities of fossil fuel production, such as the environmental and human health consequences of GHG emissions and particulate matter pollution. While it may seem difficult to account for these costs, the IMF estimates that implicit government subsidies resulted in failing to cover over $5 trillion worth of environmental damages last year.

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https://www.climaterealityproject.org/blog/fossil-fuel-subsidies-public-finance

FFS: Publically financed Fossil Fuel Subsidies

Continue ReadingFFS: Publically financed Fossil Fuel Subsidies

Carbon Capture’s Publicly Funded Failure

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https://priceofoil.org/2023/11/29/ccs-data/

Extinction Rebellion NL image reads STOP FOSSIELE SUBSIDIES
Extinction Rebellion NL image reads STOP FOSSIELE SUBSIDIES

Summary

  • Governments have spent over $20 billion – and have approved up to $200 billion more – of public money on carbon capture and storage (CCS), providing a lifeline for the fossil fuel industry.
  • 79% of operating carbon capture capacity globally sends captured CO2 to produce more oil (via Enhanced Oil Recovery).
  • Many of the largest CCS projects in the world overpromise and under-deliver, operating far below capacity.

Carbon, Capture, Utilization, and Storage (CCS or CCUS) has a 50-year history of failure. CCS is often presented as a new technology to reduce carbon dioxide (CO2) emissions by trapping CO2 from a smokestack or directly from the air and then injecting it into the ground for storage. In fact, CCS was first developed in the 1970s to enhance oil production, and increased oil production remains its primary use. Oil Change International research finds that 79% of operating carbon capture capacity globally sends captured CO2 to produce more oil (via Enhanced Oil Recovery).

The story of CCS as a method to reduce CO2 emissions is one of overpromising and under-delivering. Analysis after analysis has concluded that CCS is not a climate solution. In September 2023, the International Energy Agency noted that: “The history of CCUS has largely been one of “underperformance” and “unmet expectations.”

Yet Big Oil consistently tells us that CCS is central to the fight against climate change. Chevron, for example, says that CCS will make a “lower carbon future possible.”

In the run-up to COP28 in the United Arab Emirates, the oil industry and many governments are ramping up their promotion of CCS as an integral part of the collective response to climate change. There has been a flurry of renewed government commitments, conferences, and new industry initiatives, coupled with continuing misinformation. Governments around the world have spent over $20 billion – and have approved up to $200 billion more – of public money on CCS, providing a lifeline for the fossil fuel industry.

In October 2023, ADNOC, the Abu Dhabi National Oil Company, whose CEO, Sultan Al Jaber, is the COP28 President, announced that it planned to double its CCS capacity to 10 million tonnes per year. But ADNOC’s existing flagship CCS project, which is supposed to capture emissions from a steel plant, is only designed to capture around 17% of that plant’s maximum CO2 pollution. Furthermore, there is no publicly available information about how much CO2 it has actually captured. What the CCS project does capture is used to increase oil production, leading to more emissions when burned.

As governments prepare to spend up to $200 million of public money on CCS, it must be clear: CCS is a lifeline for the fossil fuel industry, not people and planet.

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Subsidies

Governments have spent over $20 billion – and have legislated or announced policies that could spend up to $200 billion more – of public money on CCS, providing a lifeline for the fossil fuel industry.

Key facts

  • Ten governments have already spent at least $22 billion on CCS and Fossil-Hydrogen.
  • This number is likely very conservative due to a shocking lack of transparency on government subsidies and tax credits.
  • Twelve governments have approved policies that could funnel up to $200 billion more toward CCS and Hydrogen.

…

Carbon Capture Serves Oil and Gas Production

A Majority of Carbon Capture Projects Serve To Produce More Oil and Gas, Not Reduce Emissions

Data from our project’s database and analysis from leading experts such as IEEFA and others show that the majority of carbon capture (CCS) projects exist only to enable oil and gas production and fail to reduce overall emissions.

Key facts

  • 79% of operating carbon capture capacity globally sends captured CO2 to produce more oil (via Enhanced Oil Recovery)
  • 67% of operating carbon capture capacity globally captures emissions from processing CO2-rich gas.

…

Read this article at https://priceofoil.org/2023/11/29/ccs-data/

Continue ReadingCarbon Capture’s Publicly Funded Failure

Dark money think tanks hail ‘full expensing’ measure in autumn statement

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Original article by Ruby Lott-Lavigna republished from Open Democracy under a Creative Commons Attribution-NonCommercial 4.0 International licence.

Opaquely funded lobbying group claims to be responsible for parts of Jeremy Hunt’s budget, calling it ‘amazing news’

Former chancellor Nadhim Zahawi, a patron of the Adam Smith Institute, has lobbied Jeremy Hunt for so-called ‘full expensing’ Hunt in the House of Commons
 | Chris Ratcliffe/Bloomberg via Getty Images

Opaquely funded right-wing think tanks have claimed responsibility for parts of today’s budget, celebrating its announcement as a victory for its lobbying.

Jeremy Hunt unveiled his autumn statement this afternoon, including policies such as a 2% cut to National Insurance, punitive enforcement action for those on disability benefits who do not find work in 18 months, and raising Local Housing Allowance before freezing it again in two years.

A key part of the chancellor’s budget, a policy called ‘full expensing’, means businesses can claim 100% of investment costs such as digital equipment against revenue in the same year, allowing businesses to pay less tax. It was first introduced in spring as a temporary measure but will now be made permanent.

The Adam Smith Institute, which first published a blog post on the policy in 2017, has claimed the decision as a victory.

“Amazing news that the full expensing has been made permanent,” the think tank wrote on its X (formerly Twitter) page. “Congratulations to everyone who worked so hard to make this a reality.”

It added: “We at the ASI have been campaigning for full expensing over many years.”

Former chancellor Nadhim Zahawi, a patron of the Adam Smith Institute, has lobbied for full expensing to Hunt in the House of Commons. Zahawi was fired from his role as chair of the Conservative Party and minister without portfolio after breaching the ministerial code by failing to declare he was being investigated by HMRC while chancellor under Boris Johnson.

In the past, companies like Amazon have taken advantage of expensing schemes – in particular, a ‘super-expensing’ short-term policy that allowed companies to write off 130% of investment in infrastructure. The company’s UK division paid no corporation tax for a second year in a row thanks to the scheme.

The Adam Smith Institute, named after the 18th-century Scottish thinker on capitalism, lobbies on issues such as deregulation and lower taxes. It was given the lowest possible transparency rating in openDemocracy’s ‘Who Funds You?’ project earlier this year, but is reported to be partly funded by the tobacco industry as well as American climate denial groups.

Other right-wing think tanks have also lauded the move. In a “wish list” written by free-market think tank the TaxPayers Alliance, it asked the chancellor to “Make full expensing for corporation tax permanent… to reduce the tax penalty on long-term investment.”

The TaxPayers Alliance does not publicise its funders, and was also given the lowest possible rating by Who Funds You?

Allowing businesses to invest more can be positive, so long as public spending isn’t cut in the process, Pranesh Narayanan, a research fellow at the Institute for Public Policy Research (IPPR) told openDemocracy.

“In this autumn statement, the Conservatives are able to ‘afford’ it because they’ve frozen public investment spending from 2025 onwards,” Narayanan said, referring to the billions of pounds of spending cuts forecast after the next general election. “You need both kinds of investment to have a proper economic recovery. You can’t do one at the expense of the other, especially when you have crumbling schools and crumbling hospitals.”

Narayanan added: “This policy is mainly for the benefit of big corporations. We believe we need more public investment.”

Economist Ann Pettifor argues in openDemocracy today that Hunt’s autumn statement “extinguished… any faint hope of the beginnings of an economic revival”.

Original article by Ruby Lott-Lavigna republished from Open Democracy under a Creative Commons Attribution-NonCommercial 4.0 International licence.

Continue ReadingDark money think tanks hail ‘full expensing’ measure in autumn statement

BP accused of putting ‘profit before people and planet’ as fossil fuel investments revealed

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Extinction Rebellion protests at BP
Extinction Rebellion protests at BP. Banner reads big profits before planet

https://leftfootforward.org/2023/11/bp-accused-of-putting-profit-before-people-and-planet-as-fossil-fuel-investments-revealed/

The energy giant BP has been accused of prioritising its profits over people and the planet after making £2.7 billion in profit over the last quarter, while investing £2 billion in fossil fuels.

Leading think tank IPPR said now was a time when energy companies should be urgently responding to climate change, but instead BP has “doubled down on its oil and gas business to reap enormous profits.”

For every £1 BP spent on low carbon investments in the last quarter, they invested £11 in fossil fuels it was revealed. And since the energy price shock began two years ago, BP has put nine times more into fossil fuels as renewables.

BP also completed more than £14.8 billion of buybacks from surplus cash flow whilst announcing a new round of share buybacks, which will transfer £1.2 billion to shareholders.

“It’s clear that oil and gas companies are prioritising their shareholders at the expense of the transition to clean energy, so the UK government must now take the reins by investing in renewables,” said Joseph Evans, IPPR researcher.

Although BP’s profits have actually fallen on last year, when the oil company saw mega earnings following the rise in oil prices after the Russian invasion of Ukraine, £2.7 billion profit between July and September remains extremely high as organisations ask why ordinary people are still facing high energy bills.

“The government has had countless opportunities to bring down our bills and emissions. Instead, all we’ve had are weakened green policies and massive tax breaks for oil and gas giants,” Friends of the Earth responded.

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https://leftfootforward.org/2023/11/bp-accused-of-putting-profit-before-people-and-planet-as-fossil-fuel-investments-revealed/

Continue ReadingBP accused of putting ‘profit before people and planet’ as fossil fuel investments revealed