Energy News Beat

Biggest home-price drops in the data going back to 2000 triggered by the biggest QT and highest rates in ECB history.

By Wolf Richter for WOLF STREET.

Germany is a great example of what ultra-low interest rates and massive QE do to home prices: They whip them into frenzy. And what rate hikes and QT do to home prices: they tank them.

So now the ECB’s deposit rate is at 4.0%, up from -0.5% in June 2022. And the ECB has shed €1.85 trillion from its balance sheet since the peak in the summer of 2022, having unwound roughly 40% of the assets it piled on during the pandemic, and 21% of its total assets.

The ECB’s QE came in two forms: Massive and very attractive loans to banks that banks could use to buy assets with; and purchases of all kinds of bonds, including large amounts of corporate bonds. The pandemic era loans have now been totally unwound; and the bond holdings are being shed at an accelerated pace:

In 2008, the ECB’s policies started going berserk, first in reaction to the Global Financial Crisis, then in reaction to the Eurozone Debt Crisis, then in reaction to no crisis, an in 2016, the ECB pushed its deposit rate into the negative and it stayed negative until July 2022. And then in reaction to the pandemic, the ECB blew a fuse entirely.

As these policies pushed down longer-term interest rates, including mortgage rates, home prices in Germany more than doubled in 12 years, while the ECB’s balance sheet multiplied by a factor of nine over the same period, from €1 trillion to nearly €9 trillion. But that was then and this is now.

Prices of existing homes in Germany fell by another 1.5% in Q3 from Q2, the fifth quarter in a row of declines, according to the German statistical agency Destatis on Friday. These are used single-family houses, duplexes, and condos.

Year-over-year, prices fell by 11.2%, The year-over-year drops in Q1, Q2, and Q3 had been the steepest in the data going back to 2000.

From the peak in Q2 2022, prices dropped by 12.0%.

Between 2010 and the peak in Q2 2022, the index had soared by 104%. Note how it blew a fuse when the ECB blew a fuse during the pandemic. The index has now unwound nearly all the gains since January 2021:

Prices of new homes – new single-family houses, duplexes, and condos – dropped by 0.6% in the quarter, and by 4.5% year-over-year from Q3 2022, which was also the peak. The index has now unwound nearly all of the gains since Q2 2021. Between 2010 and the peak in 2022, prices had spiked by 80%.

Single-family houses and duplexes got hit the hardest. Among all homes, existing and new, prices dropped the most for single-family houses and duplexes: -12.7% year-over-year in the largest seven metro areas (Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart, and Düsseldorf); and -12.4% year-over-year in thinly populated areas.

Condos also dropped, but not as much: -9.1% year-over-year in the largest seven metros; and -5.6% year-over-year in thinly populated areas.

Home prices and the ECB’s balance sheet. The overall home price index, which covers new and used single-family houses, duplexes, and condos, fell by 1.4% in the quarter, by 10.2% year-over-year, and by 10.9% from its peak in Q2 2022.

And this overall home price index is what we’ll use for our epic comparison to the ECB’s balance sheet. The chart shows Germany’s overall home price index (red, left scale), and the ECB’s total assets in trillions of euros (purple, right scale).

It shows the reality of QE: Interest rate repression through policy rates (short term rates) and QE (longer-term rates) causes rampant home price inflation; and with higher rates and with QT, the equation reverts and home prices tank.

Their movements aren’t proportional: The home price index about doubled between 2000 and 2022, while the balance sheet multiplied by a factor of about 9. But for the last 10 years, they have moved in the same direction with gusto:

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Energy News Beat

ENB Pub Note: Interesting points were raised by Andrew Korybko. The Biden administration has lost so much street cred on the world stage that everyone is expecting false flags being tried by them to get into another war. United States legislators have made such comments in public forums this week. Several were on Maria Bartalomo’s show.

It can’t be ruled out that the US falsely attributed blame for Saturday’s drone attack in the Indian Ocean to Iran as part of a ruse to rope India into its naval coalition that’s assembling off of the Yemeni coast and ruin its connectivity ties with Iran upon which Russia also depends as a valve from Western sanctions pressure.

The Pentagon said that Iran launched the one-way attack drone that struck a Liberian-flagged, Japanese-owned, and Netherlands-operated chemical tanker that was shipping oil from Saudi Arabia to the Indian port of Mangalore on Saturday just 200 nautical miles off of the subcontinent’s coast. The National Security Council claimed the day prior that Iran is helping the Houthis target allegedly Israeli-linked vessels, but this is the first time that the Islamic Republic was accused of carrying out its own strike.

This incident is concerning because Iran and India cooperate with Russia on the North-South Transport Corridor (NSTC), which has served as a valve from Western sanctions pressure for Moscow over the past 22 months and enabled it to preemptively avert potentially disproportionate dependence on China. Moreover, India’s trade ties with Afghanistan and the Central Asian Republics are dependent on this route, and Iran will become a fellow member of BRICS at the start of the year.

The abovementioned observations mean that any such drone attack by Iran risks disrupting this emerging Eurasian connectivity corridor to the Islamic Republic’s own detriment seeing as how Tehran also stands to financially and strategically benefit from facilitating trade along the NSTC. For these reasons, the Pentagon’s latest accusation shouldn’t be taken at face value since the US has self-interested reasons in portraying Iran as a rogue state that can’t be relied upon by any of its partners.

The larger context is that the US is in the midst of a spiraling dispute with India after the Justice Department charged one of its officials late last month with conspiring to assassinate a Delhi–designated terrorist–separatist with dual American citizenship on its soil over the summer. On top of that, its newly announced naval coalition in the Gulf of Aden-Red Sea region that was assembled to protect ships against the Iranian-backed Houthis’ attacks has been marred by controversy over who’ll command it.

It therefore can’t be ruled out that the US falsely attributed blame for Saturday’s drone attack in the Indian Ocean to Iran as part of a ruse to rope India into the aforementioned coalition and ruin its connectivity ties with Iran upon which Russia also depends as a valve from Western sanctions pressure. That hypothesis can only be proven throughout the course of a joint Indian-Iranian investigation, however, which is why it’s imperative for Tehran to fully cooperate with Delhi on this.

The outcome will determine the future of India’s ties with Iran and the US over the next year at the very least since the first’s culpability in Saturday’s attack would create very serious problems while the latter’s potential lies about who was responsible would further accelerate the deterioration of mutual trust. In between these two extremes lies the composite scenario whereby the Iranian-backed Houthis carried out this attack but without their patron state being aware of it ahead of time.

That possibility also can’t be dismissed since the earlier cited National Security Council claim explicitly mentioned that “Iran has often deferred operational decision-making authority to the Houthis.” Considering this, it could very well be the case that they made the decision to attack that vessel off of the subcontinent’s coast, after which the US took the opportunity to falsely blamed Iran for the earlier described reasons related to ruining its ties with India and creating economic troubles for Russia.

Even so, while Indian-Iranian ties would remain stable in that scenario and Russia’s valve from Western sanctions pressure would stay open as if nothing happened, Indo-US ties would worsen after Delhi realizes the game that Washington was playing in trying to destroy one of its top partnerships. Once again, the truth can only be revealed through a joint investigation with Iran, and that’s why the Islamic Republic would do well to share all relevant information with India upon request.

Source Andrew Korybko

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Energy News Beat

Summary:
The National Oceanic and Atmospheric Administration (NOAA) is an agency within the United States Department of Commerce that is responsible for monitoring and predicting changes in the Earth’s environment. As a government agency, NOAA operates under the authority of the federal government and is primarily funded by taxpayer dollars. This article aims to explore the relationship between NOAA and the government, shedding light on its organizational structure, funding sources, and the implications of being a government-run entity.

Introduction:
NOAA plays a crucial role in understanding and protecting our planet’s oceans, atmosphere, and climate. It encompasses various divisions and offices that focus on different aspects of environmental research, weather forecasting, marine conservation, and more. However, being a government agency, it is essential to understand how NOAA operates within the framework of the federal government.

Organizational Structure:
NOAA operates under the Department of Commerce, which means it is ultimately accountable to the President of the United States. Within NOAA, there are several line offices, including the National Weather Service, National Ocean Service, National Marine Fisheries Service, and others. Each office has its own specific responsibilities and areas of expertise, but they all contribute to NOAA’s overarching mission of understanding and protecting the Earth’s environment.

Funding:
NOAA’s funding primarily comes from the federal government through annual appropriations. The agency’s budget is determined by Congress, which allocates funds for various programs and initiatives. NOAA also receives additional funding from grants, partnerships, and user fees. The agency must adhere to government regulations and reporting requirements when it comes to budgeting and spending.

Implications of Being Government-Run:
As a government-run agency, NOAA operates within the framework of public service. Its primary goal is to serve the public interest by providing accurate and timely environmental information, conducting research, and ensuring the sustainable use of natural resources. Being part of the government allows NOAA to access resources, collaborate with other agencies, and leverage expertise from various fields. However, it also means that NOAA’s activities can be influenced by political priorities and changes in government policies.

FAQs

Q: Is NOAA an independent agency?
A: No, NOAA is not an independent agency. It operates under the United States Department of Commerce.

Q: How is NOAA funded?
A: NOAA’s funding primarily comes from the federal government through annual appropriations. It also receives additional funding from grants, partnerships, and user fees.

Q: Does NOAA collaborate with other government agencies?
A: Yes, NOAA collaborates with various government agencies, both within the United States and internationally, to fulfill its mission of understanding and protecting the Earth’s environment.

Q: Can NOAA’s activities be influenced by politics?
A: Yes, as a government agency, NOAA’s activities can be influenced by political priorities and changes in government policies. However, NOAA strives to maintain scientific integrity and provide objective information to the public.

Q: Where can I find more information about NOAA’s work?
A: For more information about NOAA’s work, you can visit their official website at https://www.noaa.gov/.

The post Is NOAA run by the government? Can we trust their data? appeared first on Energy News Beat.

 

Energy News Beat

(Bloomberg) — The U.S. extended its claims on the ocean floor by an area twice the size of California, securing rights to potentially resource-rich seabeds at a time when Washington is ramping up efforts to safeguard supplies of minerals key to future technologies.

The so-called Extended Continental Shelf covers about 1 million square kilometers (386,100 square miles), predominantly in the Arctic and Bering Sea, an area of increasing strategic importance where Canada and Russia also have claims. The U.S. has also declared the shelf’s boundaries in the Atlantic, Pacific and Gulf of Mexico.

The long-awaited announcement earlier this week maps the outer reaches of the U.S. continental shelf, the country’s land territory under the sea. Under international law, countries have economic rights to natural resources on, and under, the seabed floor based on the boundaries of their continental shelves.

“It’s a huge deal because it’s a huge amount of territory,” said Rebecca Pincus, director of the Polar Institute at the Wilson Center in Washington, which has devoted an entire web page to the ramifications of this week’s news. “It’s U.S. sovereignty over the seabed floor, and so whether it’s seabed mining, or oil and gas leasing, or cables, or what have you, the U.S. is announcing the borders of its ECS and will have sovereignty over those decisions.”

The US State Department said that the development “is about geography, not resources.”

The US, like all countries, has “an inherent interest in knowing, and declaring to others, the extent of its ECS and thus where it is entitled to exercise sovereign rights” it said in an emailed response to questions. Continued mapping and exploration will be needed to understand the areas’ habitats, ecosystems, biodiversity and resources, it added.

While it’s unclear what materials, if any, can be exploited, the claims come as Washington seeks to boost access to so-called critical minerals that are necessary for electric vehicle batteries and renewable energy projects, industries the Biden administration has tagged as key national security concerns. Meanwhile, there are competing calls to protect the fragile Arctic environment — the fastest warming part of the planet — as climate change opens up the region to potential development.

Resource Potential

The U.S. continental shelf contains 50 hard minerals, including lithium and tellurium, and 16 rare earth elements, James Kraska, chair and professor of International Maritime Law at the US Naval War College, wrote in an article this week. The extension “highlights American strategic interests in securing these hard minerals on its seabed and subsoil, lying sometimes hundreds of miles offshore,” he wrote.

The most recent assessment by the U.S. Geological Survey, conducted in 2008, estimated that about 90 billion barrels of undiscovered oil and 1,670 trillion cubic feet of gas lie inside the Arctic Circle, along with critical metals needed for electrification. However, most of that estimate is based on land studies and the offshore potential is largely unexplored.

More than half of America’s extended continental shelf — 520,400 square kilometers — stretches in a large wedge north of Alaska toward the Arctic Ocean, including an area that overlaps with Canadian claims to the seabed floor, according to the US statement.

Another 176,300 square kilometers lies in the Bering Sea, between Alaska and Russia, but falls on the U.S. side of the maritime boundary between the two countries. Canada and the U.S. don’t have a maritime boundary agreement in the Arctic and establishing the U.S. outer limits in the Arctic “will depend on delimitation with Canada,” the State Department said in its executive summary.

Canada’s Ministry of Foreign Affairs didn’t respond to a request for comment.

Law of the Sea

The 1982 United Nations Convention on the Law of the Sea, which the U.S. never ratified, governs maritime zones around countries. Under the law, countries have the right to any resources in the sea or seabed floor within their so-called exclusive economic zones, which can stretch up to 200 nautical miles off the coast.

But beyond that, they can claim economic rights to resources on or below the seabed floor where their continental shelf extends, although not within the water column. The seas above also remain international waters. Russia, Denmark and Canada have waited years for their overlapping Arctic seabed claims to be reviewed by the Commission on the Limits of the Continental Shelf, a UN supported group, with Russia the first to receive a ruling earlier this year.

The State Department said in its response to questions that the US would need to establish maritime boundaries in the future with Canada, the Bahamas and Japan where their claims overlap. It added that the US uses the same rules to determine its extended continental shelf as in UNCLOS, which it said the Biden administration supports joining.

The decision to unilaterally delineate its continental shelf boundary, rather than to ratify UNCLOS and then submit a claim through the commission, may raise the ire of other countries, said Pincus at the Wilson Center.

“I think a lot of other countries around the world are going to have thoughts about how the US has done this,” she said. It also may reduce the likelihood of the US ever ratifying the law since a major reason for doing so would have been to make a CLCS claim, she said.

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Energy News Beat

Germany’s state-controlled firm Securing Energy for Europe (Sefe) and Equinor signed on Tuesday one of the biggest-ever natural supply deals for Norway’s energy giant worth an estimated $55 billion (50 billion euros).

Equinor will supply Germany’s Sefe with around 10 billion cubic meters (bcm) of natural gas per year from January 1, 2024 until 2034, plus an option for another 5 years, at terms reflecting market prices, the Norwegian major said.

The annual volumes are equivalent to one third of German industrial demand, Equinor noted, adding that “After the Troll gas sales agreement in 1986, this is one of the largest gas sales agreements Equinor has entered into as a company.”

According to Reuters estimates, the deal would be worth $55 billion (50 billion euros) in total.

Sefe, wholly owned by the German government, was created last year after Germany saved a former Gazprom unit it had expropriated in April with a multi-billion-euro loan. Gazprom Germania was renamed Securing Energy for Europe GmbH (Sefe), to secure energy supply to Germany and Europe, the government said last summer.

“The total volumes we have agreed make this one of the largest agreements we have made as a company, and the supplies will contribute to energy security for Germany and Europe,” Equinor’s chief executive Anders Opedal said in a statement.

Egbert Laege, CEO of Sefe, said “The procurement of natural gas from the Norwegian continental shelf ensures the sustainable and future-proof supply for European and, in particular, German customers in the household and industrial sectors.”

The natural gas will be delivered to Trading Hub Europe (THE) in Germany, Title Transfer Facility (TTF) in the Netherlands, and at the National Balancing Point (NBP) in the UK.

The deal signed today also includes a non-binding letter of intent for Sefe to become a long term off-taker of giga-scale, low-carbon hydrogen supplies from Equinor starting in 2029 and continuing towards 2060.

By Michael Kern for Oilprice.com

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Energy News Beat
ESG funds are experiencing a decrease in new inflows and increased closures due to underperformance and investor withdrawal.
Regulatory tightening, greenwashing exposure, and a return to oil and gas investments contribute to the declining appeal of ESG funds.
Despite previous overperformance, ESG funds are now struggling as investor sentiment shifts back towards traditional energy sectors and increased scrutiny on sustainability claims.

Environmental, social, and governance-focused investment was all the rage a couple of years ago. The impulse to signal an environmentally or socially responsible reputation was so strong that ESG investment funds saw massive influxes of fresh assets.

Now, ESG funds are shutting down or dropping the “sustainable” part from their names. Their performance is leaving a lot to be desired, and investors are fleeing. It is a moment of truth for the nascent market niche, and the truth hurts.

Reuters reported this week that funds classified as sustainable saw net new inflows of $68 billion over the first 11 months of the year, which compares with $158 billion last year, per data from LSEG Lipper, the fund performance data provider owned by Reuters’ parent.

That’s quite a drop, but compared to 2021, the 2023 figure looks even worse: in 2021, net new inflows into ESG funds totaled $558 billion, LSEG Lipper data shows.

“What happened?” is the question that should now be asked.

What happened was a number of things. First, oil prices tanked in 2020 because of the lockdowns. They stayed tanked in 2021, leading many investors to flee the sector and seek diversification. Second, greenwashing reared its ugly head. Third, the transition leaning on these funds stuttered amid soaring cost inflation.

In April 2020, the price of U.S. crude oil slipped below $0 for the first time ever. The event, though short-lived, highlighted the impact that pandemic lockdowns were having on global energy markets—and perhaps more importantly, energy demand.

Investors quit oil and gas and sought new opportunities. ESG funds were being actively promoted as both profitable and moral—a win-win situation many could not resist, not least because of the firm government hand behind the sustainable future these funds advertised as working to build.

Then, the pandemic lockdowns ended. People started leaving their houses again. Energy demand rose. Oil demand rose. So did oil prices. Inflation pushed the costs of all forms of energy higher. And reports began to emerge that not everything that calls itself sustainable is actually sustainable.

ESG funds began to close: this year alone, more than two dozen such funds were closed, per Bloomberg. Others are seeing investor outflows because of the absence of clear ESG targets. The “sustainable” designation is no longer enough. Some funds are dropping the label “sustainable” from their names altogether because it is no longer bringing in investors.

Regulators are tightening the rules about which funds actually have the right to call themselves sustainable. The SEC last year launched an investigation into Goldman Sachs’ ESG funds. Tennessee is currently suing BlackRock over its ESG strategies, which, the state says, violate consumer protection laws by overstating “the extent to which ESG considerations can affect companies’ financial performance and outlook.”

That lawsuit is an instance of another problem for ESG investing: a Republican state backlash against the trend that saw some states, such as Texas, threaten to pull out their own money from asset managers that, according to them, discriminate against the oil and gas industry.

Meanwhile, to make matters worse for ESG fund managers, oil prices have livened up considerably. The year 2022 delivered record profits for Big Oil. Investors previously eager to make some money from being environmentally, socially, and governance responsible returned to the land of emissions. Regulators pushed harder against greenwashing.

ESG funds did outperform the broader market despite changing investor sentiment. But it wasn’t because sustainable business was making a lot of money. It was because Big Tech was making a lot of money, and ESG funds tend to have a heavy exposure to Big Tech.

Big Tech majors are indeed the biggest fans of sustainability with their wind and solar PPAs and their carbon offsets. These also fell from grace this year as it emerged that carbon offset projects were not, for the most part, offsetting anything.

All in all, this year investor behavior and attitude towards ESG funds has reflected the deepening troubles of transition-related industries. Wind power project costs soared so high that some projects became unviable. For others, project developers asked for and received commitments for higher electricity prices once the projects became operational.

Solar power did better, but demand is on the wane there, too, not least about those same higher costs and the EU’s and the U.S.’ latest push against China. Most recently, the crisis in the Red Sea that diverted most traffic between Asia and Europe will also add to the cost of equipment coming from China.

EV makers had a bad year as well, rising manufacturing plans as demand failed to live up to expectations consistently and despite government efforts to incentivize it via subsidies. Reports about EVs catching fire multiplied, and so did complaints about the cars’ performance.

Then, this week, Reuters published a detailed investigation into Tesla, revealing tens of thousands of grave mechanical failures that the company knew about for years but blamed on the drivers. Deutsche Bank’s chief investment officer for ESG said oil and gas stocks should be added to ESG funds because investors wanted to invest in oil and gas.

Demand for ESG investing will probably remain less enthusiastic than two years ago next year as well. Regulators are still keeping an eye on the segment, ready to start regulating harder at the drop of a feather. Oil and gas are on the climb again. Based on 2024 demand and supply forecasts, they may continue climbing for some time. Governments will need to work harder to keep investors green.

By Irina Slav for Oilprice.com

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Energy News Beat

US President Joe Biden has been warned that “no one takes him seriously” as a military operation in the US collapses due to the withdrawal of European countries from its command structure.

France, Spain, and Italy all announced their withdrawal from the US Command Structure for Operation Prosperity Guardian, adding that they will only conduct further Maritime Operations under the Command of NATO and or the European Union – not the United States.

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Energy News Beat

India will increase the size of its thermal power fleet, the country’s power minister said, to meet an increased demand for power.

India said it would add another 88GW of new power capacity by early 2032-63% more than India’s plan that it published just seven months ago. And most of that will be coal-fired power, with gas-fired electricity generation unavailable to India due to the high cost of natural gas.

India will not only leave out natural gas power in its expansion plans, but it doesn’t even use the gas-fired electricity plants it has now-at least not to their total capacity. According to Bloomberg, citing ministry data, India’s 25GW of gas-based electricity plants operated at 15% capacity so far this fiscal year.

Clean energy is also not on the table for India, with prices too high and costly storage capacity sorely lacking.

Meanwhile, India’s electricity demand continues to rise above expectations, with maximum demand exceeding the power ministry’s projections of 229GW multiple times so far this year and forecasts of 366GW for fiscal 2032.

With gas not a viable option due to cost, “India has no other alternative than to expand coal-based power for now,” a professor of energy and climate at the National Institute of Advanced Studies in Bangalore told Bloomberg. “You need storage to supply round-the-clock clean energy and we neither have the scale nor the desired costs for storage technology to meet our needs.”

India-the world’s fastest-growing economy-has added 5GW of coal-based electricity generation capacity each year over the past five years.

Now, in order to meet its desired coal-fired power expansion, India must remove the roadblocks to existing coal projects, such as land acquisition delays.

 

The post India To Grow Thermal Coal Power Fleet As Demand Calls appeared first on Energy News Beat.

 

Energy News Beat

International climate talks at COP28 can feel a little like Albert Einstein’s definition of insanity. Countries come to the table each year with similar requests and demands. Pledges are made to cut emissions, transition away from fossil fuels, and transfer money from developed countries to developing ones. Turning words into action can prove difficult, especially if it comes at high costs to consumers and taxpayers.

One of the more encouraging shifts at COP talks is the role of technology, innovation, and the private sector in addressing climate change. In a world where food security, clean water access, and energy affordability are pressing concerns, free markets can provide a suite of solutions that improve peoples’ lives while reducing global emissions.

How Does Economic Freedom Impact the Climate?

When considering the effect of free economies on greenhouse gas emissions and climate resiliency, several factors come into play. The effectiveness of economic freedom on climate mitigation and adaptation will depend on which policy lever that increases or decreases economic freedom lawmakers use. More efficient tax policy or improving permitting processes could increase economic freedom, which could improve technological innovation and therefore increase economic and environmental efficiencies. That would result in fewer emissions per dollar of GDP. On the other hand, imposing stringent regulations on power plants may reduce CO2 emissions but decrease economic freedom and could come at steep costs to ratepayers.

Like other byproducts of industrial activity, it stands to reason that if higher levels of economic freedom result in higher levels of economic growth, it will also lead to higher levels of greenhouse gas emissions. Several studies have examined the causal effects of economic freedom on CO2 emissions and environmental degradation using CO2 as a proxy, and the results have been mixed. For instance, one analysis published in Environmental Science and Pollution Research in 2022 looked at the environmental outcomes of G-20 economies from 2000–2016. The authors found that the higher levels of investment and economic opportunity resulting from economic freedom put greater strains on countries’ ecosystems. A 2014 study from the Canadian-based Fraser Institute found no statistical significance between increases in economic freedom and CO2 emissions reductions.

Free market policies could result in CO2 emissions following the Environmental Kuznets Curve, where more economic activity increases both wealth and emissions but over time, more resources and technological progress helps bend the emissions curve backwards. A 2020 Research of Industrial Economies paper found encouraging results. The paper combines emissions growth, GDP per capita and rankings on the Fraser Institute’s Economic Freedom of the World Index to find that “available data from 155 countries observed in five-year periods between 1975 and 2015 indicate that economic freedom not only reduces overall CO2 emissions but also shifts the top point of the EKC to the left. As such, the evidence suggests that the transition to lower emissions technology appears at an earlier stage in economically free societies.”

If cleaner technologies, processes, and products are more cost-effective, developing countries will have the incentive to pursue those technologies as opposed to their higher-emitting counterparts. To the extent mature, clean energy sources are unsubsidized, they will likely have a greater chance of long-term economic success because there will be more transparency regarding the price at which these technologies are competitive in the market. Research has shown economic freedom’s positive impact on clean energy generation. A July 2023 study in Environmental Science and Pollution Research looked at the relationship between economic freedom and CO2 emissions in 138 countries from 1995–2018 and found “economic freedom has a direct and indirect negative effect on carbon emissions and that renewable energy consumption mediates the effect of economic freedom on carbon emissions.”

Economic Freedom Helps Build Climate Resilience  

Another consideration is how economic freedom can help countries better adapt to climate change. Free economies are wealthier, more innovative and have access to advanced technologies that enable people to better adapt to climate change. Having the economic means to construct stronger levees, sea walls, and more resilient infrastructure has helped save lives and protect communities.

Advanced technologies such as early detection systems, visualization tools, up-to-date flood maps, computer modeling, satellite, and radar are several tools that scientists employ to track weather and storms. Affordable, reliable heat in the winter and air conditioning in the summer offers protection against extreme weather. Researchers are developing crops that better withstand heatwaves and droughts. These investments are not costless but can be a cost-effective solution to reduce the risks and costs of extreme weather. Given the connection between economic freedom and wealth, there is also a strong, positive correlation between those countries that are most economically free and those countries that are the most resilient.

Turning Words into Action

Much of the immediate focus after COP28 is an assessment of the language of the communique. But truly turning words into action will require policymakers around the world to liberate their economies. Policies that encourage people to innovate, build efficiently, and invest and trade freely will elevate levels of human prosperity and drive technological advancements to solve our greatest environmental challenges.

Source: C3NewsMag

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Energy News Beat

The British security firm Ambrey has described the Chem Pluto as Israeli-affiliated

 

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