Companies cited by EPA for fake biofuel credits

By Ayesha Rascoe

WASHINGTON | Tue Nov 15, 2011 4:05pm EST

Fiona Harvey

April 23, 2011

SENIOR executives in the fossil fuel industry have launched an all-out assault on renewable energy, lobbying governments and business groups to reject wind and solar power in favour of gas, in a move that could choke the green energy industry.

Multinational companies including Shell, GDF Suez and Statoil are promoting gas as an alternative green fuel. These firms are among dozens worldwide investing in new technologies to exploit shale gas, a controversial form of the fuel that has rejuvenated the gas industry because it is in plentiful supply and newly accessible because of technical advances in gas extraction that are known as fracking.

Burning gas in power stations releases about half the carbon emissions of coal, allowing gas companies to claim it is a green source of fuel.

For the past two months company lobbyists have been besieging governments in Europe, the US and elsewhere.

Central to the lobbying effort is a report saying that the European Union could meet its 2050 carbon targets more cheaply, avoiding costs of €990 billion ($1.3 trillion), by using gas rather than investing in renewables.

However, The Guardian has established that the analysis is based on a previous report that came to the opposite conclusion: that renewables should play a much larger role. The report being pushed by the fossil fuel industry has been disowned by its original authors, who referred to it as biased in favour of gas.

The new report relies on questionable assumptions about the future price of technology to capture and store carbon. The team at the European Climate Foundation that produced the original report described the new version, commissioned by the European Gas Advocacy Forum, as ”biased to one preferential outcome in support of gas advocacy”. It warn that adopting its conclusions would expose the European economy to volatile gas prices.

Further doubt has been thrown on the industry’s claims by an academic study from Cornell University which found that generating electricity from shale gas produced at least as much carbon dioxide as coal-fired power, and perhaps more, because of the difficulty in extracting the gas.

James Smith, outgoing British chairman of Royal Dutch Shell, one of the leaders in the lobbying effort, said switching to gas would offer the world a ”breathing space” in the battle against climate change.

This view was challenged by David Mackay, chief scientific adviser to Britain’s Department of Energy and Climate Change. He said: ”You can’t reach the [climate] targets like this. There is no way that switching to gas would solve the problem. I don’t think it’s really credible that gas is the only future.”

Nobuo Tanaka, executive director of the International Energy Agency, said gas was ”complementary to renewables, as it could be turned on and off quickly, could be baseload power and [avoid use of] coal”.

Guardian News & Media

Row over responsibility for sold-off systems has left Sri Lankan communities unable to replace faulty equipment

Terry Macalister
The Observer, Sunday 3 January 2010

Shell is at the centre of a row over warranties for solar power systems sold to the developing world. Photograph: Leon Neal/AFP/Getty Images

Shell has become embroiled in a major row with the World Bank and green energy companies after allegations that it is unfairly refusing to honour warranties on solar power systems sold to the developing world.

A widespread breakdown of its equipment in Sri Lanka and elsewhere has left the oil firm accused of abandoning a responsibility to impoverished communities while damaging the prospects of the wider renewable power sector in a world desperate to reduce carbon emissions following the Copenhagen climate change summit.

The rural electrification business under which the Shell systems were sold has now itself been passed on – as have most other parts of the group’s solar business – but critics say that Shell, which made profits of $31bn in 2008, has a continuing role in ensuring former customers are not left vulnerable.

“Shell exited solar on a global basis, seemingly without due consideration to how after-sales service and warranty replacements would be provided, thereby damaging the very local solar industries it had earlier helped to create,” said Damian Miller, a former Shell manager who now heads his own solar business, Orb Energy.

“In Sri Lanka, poor customers with average earnings of $1,500-$2,000 a month have bought Shell’s solar systems. The system is equivalent to 30% of their annual income,” he added. “They could only afford a system because they could get a loan from microfinance institutions or other banks. But now there are reports of thousands of Shell’s [branded] solar panels failing in the field and Shell seemingly is not replacing them.”

The World Bank, which provides financing packages to the developing world, said it too was very worried about a situation in which about 700 solar systems appear to have failed and local suppliers risked going out of business.

Anil Cabraal, an energy specialist at the bank’s Washington headquarters, has written to Shell asking for action. “I would like Shell to honour these commitments. We are not talking about millions of dollars here but hundreds of thousands,” he told the Observer.

The company argues that it is being unfairly targeted and is doing all it can to sort out the problem. It points out that its Shell Solar Sri Lanka business has been transferred to a third-party purchaser, Environ Energy, along with all liabilities. The Anglo-Dutch oil group says the bulk of its former solar module manufacturing operation has also been switched to a new owner, Solar World.

“In October 2007, Shell sold Shell Solar Lanka Ltd to Environ Energy Global PTE Ltd. Specifically in order to protect customer interests, the terms of the transaction explicitly covered the management of all past, present and future liabilities, including warranty issues,” said a Shell spokesman in the Hague.

“Environ Energy Global understands that resolution of this issue rests with Environ, but [its] own management team in Sri Lanka continues to approach Shell. We have asked Environ Energy Global to clarify responsibilities with [its] own management team in Sri Lanka.”

The situation has been complicated by the fact that Environ claims Solar World will not replace any modules unless it has the appropriate warranty documents. Environ claims those papers were destroyed by Shell prior to the handover to Solar World, although Shell told the Observer this was not true.

GUARDIAN ARTICLE