tag:theconversation.com,2011:/uk/topics/methane-capture-16366/articlesMethane capture – The Conversation2019-11-22T17:58:12Ztag:theconversation.com,2011:article/1223762019-11-22T17:58:12Z2019-11-22T17:58:12ZFight or switch? How the low-carbon transition is disrupting fossil fuel politics<figure><img src="https://images.theconversation.com/files/297728/original/file-20191018-56234-jty18o.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C3514%2C2377&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Commuters idle in rush-hour traffic outside Philadelphia. </span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/AP-Poll-Climate-Taking-Action/e015e1e136814576845a004e8af8f401/13/0">AP Photo/Jacqueline Larma</a></span></figcaption></figure><p>As the Trump administration works to <a href="https://www.cpr.org/2019/01/29/the-trump-rollbacks-on-fossil-fuel-industry-regulations-carry-a-steep-cost/">weaken regulations on fossil fuel production and use</a>, a larger struggle is playing out across multiple industries. Until recently, oil companies and their defenders generally reacted to calls for regulating carbon emissions by <a href="https://www.merchantsofdoubt.org/">spreading doubt and promoting climate denialism</a>. However, I believe this approach is becoming less effective as climate change effects worsen and <a href="https://rebellion.earth/">public demands for action</a> intensify worldwide. </p>
<p>As a scholar who focuses on the <a href="https://liberalarts.vt.edu/departments-and-schools/department-of-political-science/faculty/cara-daggett.html">politics of energy and the environment</a>, I see growing anxiety among corporate elites. Some fossil fuel defenders are embracing a new strategy that I call <a href="https://doi.org/10.1177/0305829818775817">climate defiance</a>. With a transition to a low-carbon economy looming, they are accelerating investments in fossil fuel extraction while <a href="https://e360.yale.edu/digest/fossil-fuel-interests-have-outspent-environmental-advocates-101-on-climate-lobbying">pressuring governments</a> to delay climate action.</p>
<p>Climate defiance is leading to some surprising clashes between the Trump Administration, bent on extreme deregulation and extraction, and many other companies who recognize that the fossil fuel economy is unsustainable, even if they have not embarked upon a green transition. Climate change is sparking this self-reflection, which is writing a new chapter in global warming politics. </p>
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<a href="https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/301847/original/file-20191114-26262-18vdhpu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Workers tend to a well head during a hydraulic fracturing operation outside Rifle, in western Colorado, March 29, 2013.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/CORRECTION-Fracking-Colorado/740908cd76904f4ca1273b0ecbfce953/183/0">AP Photo/Brennan Linsley</a></span>
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<h2>Car wars</h2>
<p>One high-profile example is the Trump administration’s effort to weaken corporate average fuel economy, or CAFE, standards negotiated by the Obama administration, which were projected to reduce U.S. oil consumption by an estimated <a href="https://obamawhitehouse.archives.gov/the-press-office/2012/08/28/obama-administration-finalizes-historic-545-mpg-fuel-efficiency-standard">two million barrels per day</a>. Early in the Trump presidency, both <a href="https://autoalliance.org/wp-content/uploads/2017/02/Letter-to-EPA-Admin.-Pruitt-Feb.-21-2016-Signed.pdf">an auto industry consortium</a> and <a href="https://www.nytimes.com/2018/12/13/climate/cafe-emissions-rollback-oil-industry.html">fossil fuel producers</a> <a href="https://www.theatlantic.com/science/archive/2018/06/how-the-carmakers-trumped-themselves/562400/">lobbied hard</a> for the Trump administration to weaken the emissions standards. </p>
<p>But when it became clear that the Trump administration planned to go further than simply weakening the standards, and to freeze them altogether in 2020, <a href="https://www.nytimes.com/2018/03/30/climate/epa-auto-pollution-pruitt.html">some automakers balked</a>. California and more than a dozen other states insisted on the right to <a href="https://www.washingtonpost.com/news/energy-environment/wp/2018/05/01/california-17-other-states-sue-trump-administration-to-defend-obama-era-vehicle-efficiency-rules/">keep higher standards</a>, and four major automakers – Ford, Honda, Volkswagen and BMW – joined <a href="https://www.nytimes.com/2019/08/20/climate/trump-auto-emissions-rollback-disarray.html">them</a>. </p>
<p>Those companies, who represent about 30% of the U.S. market, have now agreed to adhere to stricter emissions standards similar to the Obama plan, citing the need for <a href="https://www.nytimes.com/2019/07/25/climate/automakers-rejecting-trump-pollution-rule-strike-a-deal-with-california.html?module=inline">more regulatory certainty</a>. In retaliation, the Justice Department recently opened an <a href="https://www.nytimes.com/2019/09/06/climate/automakers-california-emissions-antitrust.html">antitrust investigation</a> into the pact. </p>
<p>Meanwhile, Toyota, General Motors and Fiat Chrysler are <a href="https://www.nytimes.com/2019/10/28/climate/general-motors-california-emissions-trump.html?action=click&module=inline&pgtype=Homepage">siding with the Trump administration</a>. Their decision surprised many industry watchers, particularly given <a href="https://www.nytimes.com/2019/10/29/business/toyota-california-emissions-honda-gm-chrysler.html">Toyota’s leadership</a> in designing low-emissions vehicles. </p>
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<img alt="" src="https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=412&fit=crop&dpr=1 600w, https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=412&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=412&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=517&fit=crop&dpr=1 754w, https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=517&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/297727/original/file-20191018-56220-1vbfjtb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=517&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">California Air Resources Board Chair Mary Nichols, center, with Gov. Gavin Newsom, left, and California Attorney General Xavier Becerra. The state is suing the Trump administration for revoking California’s authority to set its own vehicle emissions standards.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Trump-Fuel-Economy/02f4d17a72dc4193b58f5d7537e5a827/2/0">Rich Pedroncelli/AP</a></span>
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<h2>Methane capture</h2>
<p>Another divisive issue is the Trump administration’s plan to ease regulations curbing methane emissions from natural gas production. Energy companies tout natural gas as a <a href="https://www.igu.org/natural-gas-cleanest-fossil-fuel">cleaner fossil fuel</a> because it generates fewer carbon dioxide emissions than coal or oil. </p>
<p>However, methane – the main component of natural gas – is a greenhouse gas that contributes significantly to global warming. According to some studies, methane leaks from natural gas extraction and production, known as fugitive emissions, may make natural gas extracted from shale rock <a href="https://doi.org/10.1007/s10584-011-0061-5">worse than coal in terms of its greenhouse gas footprint</a>.</p>
<p>Several major oil companies, including BP and Royal Dutch Shell, <a href="https://www.reuters.com/article/us-ceraweek-energy-bp-methane/bp-teams-up-with-edf-to-tackle-methane-leaks-idUSKBN1QU1IB">oppose Trump’s plan to further deregulate methane</a>. Why? They have invested heavily in natural gas as a way to extend their fossil fuel business, and <a href="https://www.houstonchronicle.com/opinion/outlook/article/BP-America-chief-It-s-time-for-the-Trump-13721656.php">methane leaks pose a serious threat</a> to the notion that natural gas should play a prominent role in a green transition, especially as renewable energy <a href="https://www.irena.org/newsroom/pressreleases/2019/May/Falling-Renewable-Power-Costs-Open-Door-to-Greater-Climate-Ambition">costs continue to decline</a>. </p>
<p>In contrast, the American Petroleum Institute and smaller oil and gas companies <a href="https://www.nytimes.com/2019/08/29/business/energy-environment/methane-regulation-reaction.html">support the rollback</a>, claiming that methane control is too expensive. </p>
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<figcaption><span class="caption">Thermal cameras show methane leaking from oil and gas operations.</span></figcaption>
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<h2>Shades of green</h2>
<p>Beyond these specific controversies, many companies in the energy sector and beyond have voiced support for moving to a lower-carbon economy. </p>
<p>For example, in August 2019 the Business Roundtable, a corporate advocacy group comprised of almost 200 CEOs from major American corporations, declared that corporate responsibility meant <a href="https://www.businessroundtable.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-economy-that-serves-all-americans">more than just serving shareholders</a>. Instead they adopted a broader definition that includes serving customers, employees, suppliers, communities and shareholders, and pledged to “protect the environment by embracing sustainable practices across our businesses.”</p>
<p>Such declarations are easy to dismiss as <a href="https://doi.org/10.1177/1086026615575332">corporate greenwashing</a>. Corporate responses to climate change have largely touted market-based reforms, like <a href="https://www.leadoncarbonpricing.com/news/">pricing carbon emissions</a>, which would not jeopardize ongoing fossil fuel extraction and profits. </p>
<p>Indeed, global fossil fuel and overall energy consumption <a href="https://www.iea.org/geco/">are still rising</a>. And while banks may highlight their
<a href="https://www.cnbc.com/2017/08/23/10-banks-renewable-and-slashing-their-environmental-impact.html">support for renewable energy projects</a>, they also have provided <a href="https://www.ran.org/bankingonclimatechange2019/">at least US$1.9 trillion</a> in fossil fuel financing since the 2016 Paris Agreement entered into force.</p>
<p>Meanwhile, <a href="https://www.ipcc.ch/sr15/chapter/spm/">recent climate change assessments</a> warn that avoiding warming on a catastrophic scale will require “rapid and far-reaching transitions in energy, land, urban and infrastructure (including transport and buildings), and industrial systems.” Many experts assert that change on this scale will ultimately require countries to <a href="https://www.nationalgeographic.com/news/2015/12/151207-climate-change-holdren-white-house-science-paris/">stop burning fossil fuels altogether</a>. </p>
<p>Others assert that investments in renewable energy alone <a href="https://doi.org/10.1038/nclimate1451">will not stave off drastic warming</a>. Historically, they argue, new renewable energy additions have mostly <a href="https://doi.org/10.1016/j.erss.2019.01.008">increased overall energy consumption</a>, rather than displacing fossil fuels. From this perspective, phasing out fossil fuels will require political action. </p>
<p>Such a shift poses an existential threat to major oil companies. Big Oil touts its green projects, but renewable energy accounts for only <a href="https://6fefcbb86e61af1b2fc4-c70d8ead6ced550b4d987d7c03fcdd1d.ssl.cf3.rackcdn.com/cms/reports/documents/000/003/858/original/CDP_Oil_and_Gas_Executive_Summary_2018.pdf?1541783367">1% to 4% of its new investments</a>. In the view of energy scholars Daniel Sperling and Lewis Fulton, Big Oil has “<a href="https://theconversation.com/oil-companies-are-thinking-about-a-low-carbon-future-but-arent-making-big-investments-in-it-yet-122365">no clear road map</a>” for a green transition. </p>
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<h2>An existential choice</h2>
<p>In my view, struggles between the Trump administration and major corporations over environmental deregulation signal an awareness that the fossil fuel economy’s days are numbered. Although climate deniers occupy prominent positions in the White House, Congress and the Environmental Protection Agency today, recent polls show that <a href="https://climatecommunication.yale.edu/publications/a-growing-majority-of-americans-think-global-warming-is-happening-and-are-worried/">two-thirds of Americans</a> are worried about climate change and believe it will harm them.</p>
<p>As I argue in my <a href="https://www.dukeupress.edu/the-birth-of-energy">recent book</a>, our fossil fuel system was set up to put the world to work for the benefit of European and American powers. Its profits come from undervaluing the labor and resources that feed it, which I believe has led not only to climate change but to <a href="https://doi.org/10.1146/annurev-economics-080218-025852">extreme global wealth inequality</a>.</p>
<p>A green transition is therefore not only a technical project. As <a href="https://www.c40.org/press_releases/global-gnd">global interest</a> in Green New Deals suggests, climate change <a href="https://www.theatlantic.com/science/archive/2019/02/green-new-deal-economic-principles/582943/">calls fossil fuel capitalism itself into question</a>. </p>
<p>I see corporations beginning to sense this challenge. Some companies, especially those built upon fossil fuels, will continue to resist moving toward a lower-carbon future. Others will promote market reforms rather than broader systemic changes. I believe, however, that the most forward-looking must begin to imagine how they will fit into a just and decarbonized economy. </p>
<p>[ <em>Get the best of The Conversation, every weekend.</em> <a href="https://theconversation.com/us/newsletters/weekly-highlights-61?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=weeklybest">Sign up for our weekly newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/122376/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Cara Daggett does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>As the effects of climate change become clearer and more ominous, fossil fuel companies face a choice: Defy warnings of catastrophic climate change, or envision their roles in a post-carbon world.Cara Daggett, Assistant Professor of Political Science, Virginia TechLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/826442017-08-23T19:21:43Z2017-08-23T19:21:43ZCapturing the true wealth of Australia’s waste<figure><img src="https://images.theconversation.com/files/183101/original/file-20170823-13308-ce4edu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Methane is produced in landfill when organic waste decomposes. </span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>One of the byproducts of landfill is “landfill gas”, a mixture of mostly methane and carbon dioxide generated by decomposing organic material. Methane is a particularly potent greenhouse gas, but it can be captured from landfill and used to generate clean electricity.</p>
<p>Methane capture is a valuable source of power but, more importantly, it can significantly reduce Australia’s methane emissions. However the opportunity to produce energy from waste is largely being squandered, as up to 80% of the potential methane in waste is not used. </p>
<p>If more councils were prepared to invest in better facilities, Australians would benefit from less waste in landfill and more energy in our grids. Even the by-product from using state-of-art processing methods can be used as a bio-fertiliser.</p>
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<a href="https://theconversation.com/explainer-how-much-landfill-does-australia-have-78404">Explainer: how much landfill does Australia have?</a>
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<p>And while these facilities are initially more expensive, Australians are generally very willing to recycle, compost and take advantage of community schemes to reduce waste. It’s reasonable to assume that a considerable percentage of our population would support updating landfill plants to reduce methane emissions. </p>
<h2>Recycling in Australia</h2>
<p>Australia may have a bad rap when it comes to waste recycling, but there are plenty of positives.</p>
<p>Australians produce approximately <a href="https://data.oecd.org/waste/municipal-waste.htm">600 kilograms of domestic waste per person, per year</a> – no more than most northern European countries, which set the benchmark in sustainable waste management. </p>
<p>Looking at kerbside bins we, on average, <a href="https://www.ehp.qld.gov.au/waste/state-of-waste-report.html">recycle 30-35% of that waste</a>, saving much of our paper, glass, aluminium and steel from landfill (which also saves and reduces emissions). </p>
<p>Although the household recycling rate in Australia is less than the best-performing EU recycling rates of 40-45%, this is primarily due to a lack of access to (or awareness of) <a href="https://theconversation.com/does-not-compute-australia-is-still-miles-behind-in-recycling-electronic-products-63381">schemes to recycle e-waste and metals</a>. Data therefore suggests that at the community level, there is a willingness to minimise and recycle waste.</p>
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<p><strong><em>Read more:</em></strong></p>
<p><strong><em><a href="https://theconversation.com/does-not-compute-australia-is-still-miles-behind-in-recycling-electronic-products-63381">Australia is still miles behind in recycling electronic products</a></em></strong></p>
<p><strong><em><a href="https://theconversation.com/campaigns-urging-us-to-care-more-about-food-waste-miss-the-point-80197">Campaigns urging us to ‘care more’ about food waste miss the point</a></em></strong></p>
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<p>Between 55% and 60% of kerbside waste sent to landfill in Australia is organic material. Over 65% of this organic fraction is <a href="http://www.environment.gov.au/protection/national-waste-policy/national-waste-reports/national-waste-report-2013">food waste</a>, similar to the make-up of the EU organic waste stream, comprised of <a href="http://www.iea-biogas.net">68% of food waste</a>. </p>
<p>Despite this large fraction, approximately half of the household organic we produce – mostly garden waste – is <a href="https://www.ehp.qld.gov.au/waste/state-of-waste-report.html">separately collected and disposed</a>, again demonstrating high participation by the community in recycling when collection and disposal options are available. </p>
<h2>Turning waste into energy</h2>
<p><a href="https://theconversation.com/explainer-why-we-should-be-turning-waste-into-fuel-77463">Energy recovery from waste</a> is the conversion of non-recyclable material into useable heat, electricity, or fuel. Solid inorganic waste can be converted to energy by combustion, but organic waste like kitchen and and garden refuse has too much moisture to be treated this way. </p>
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<a href="https://theconversation.com/explainer-why-we-should-be-turning-waste-into-fuel-77463">Explainer: why we should be turning waste into fuel</a>
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<p>Instead, when organic waste is sent to landfill it is broken down naturally by microorganisms. This process releases methane, a greenhouse gas <a href="https://www.epa.gov/ghgemissions/overview-greenhouse-gases#methane">25 times more potent than carbon dioxide</a>. </p>
<p>Around 130 landfills in Australia are <a href="https://theconversation.com/explainer-how-much-landfill-does-australia-have-78404">capturing methane</a> and using it to generate electricity. Based on installed power generation capacity and the amount of waste received, Australia’s largest landfills use 20-30% of the potential methane in waste for electricity generation. </p>
<p>Ravenhall in Melbourne processes 1.4 million tonnes of waste per year, and proposes to generate <a href="https://www.mwrrg.vic.gov.au/assets/Uploads/Cleanaway-submission.pdf,%20_https://www.planning.vic.gov.au/__data/assets/pdf_file/0026/68057/Melbourne-Regional-Landfill-Expansion,-Ravenhall-Panel-Report.pdf">8.8 megawatts (MW) of electricity by 2020</a>. Roughly 461,000 tonnes of waste goes to Woodlawn in NSW, and <a href="http://www.veolia.com/sites/g/files/dvc1131/f/assets/documents/2016/10/2012_Environmental_Audit_Report_Golder_Associates.pdf">in 2011 it generated 4MW of electrical power</a>. Swanbank in Queensland receives 500,000 tonnes a year and generates 1.1MW. </p>
<p>The remainder of the methane is flared due to poor gas quality or insufficient transmission infrastructure, is oxidised as it migrates towards the surface of the landfill, or simply escapes. The methane generating capacity of waste is also diminished because organics begin composting as soon as they reach landfill.</p>
<p>But there are more efficient ways to capture methane using specialised anaerobic digestion tanks. The process is simple: an anaerobic (oxygen free) tank is filled with organic waste, which is broken down by bacteria to produce biogas. This is similar to the natural process that occurs in landfill, but is much more controlled and efficient in a tank.</p>
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Read more:
<a href="https://theconversation.com/biogas-smells-like-a-solution-to-our-energy-and-waste-problems-36136">Biogas: smells like a solution to our energy and waste problems</a>
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<p>The <a href="https://theconversation.com/biogas-smells-like-a-solution-to-our-energy-and-waste-problems-36136">biogas</a> can be combusted to produce electricity and heat, or can be converted to pure biomethane to be used either in the mains gas grid, or as a renewable transport fuel. In contrast to landfills, <a href="http://www.eubia.org/cms/wiki-biomass/anaerobic-digestion/">60-80% of the methane potential of waste</a> is used to generate electricity in anaerobic digesters, with most of the remainder used to power waste handling and the digestion process. </p>
<p>The nutrient-rich sludge that remains after anaerobic digestion, called digestate, is also a valuable <a href="http://task37.ieabioenergy.com/files/daten-redaktion/download/publi-task37/Digestate_Brochure_Revised_12-2010.pdf">biofertiliser</a>. It can support food production, and further reduce greenhouse gases by decreasing our reliance on energy-intensive manufactured fertilisers. </p>
<p>The use of food waste as a feedstock for anaerobic digestion is largely untapped in Australia but has huge potential. A site in Sydney’s geographic centre (<a href="https://earthpower.com.au/">Earth Power Technologies</a>) and <a href="https://arena.gov.au/assets/2015/11/Jandakot-Bioenergy-Plant.pdf">Richgro’s</a> Jandakot facility near Perth are part of a handful that are converting food waste to energy using this technology.</p>
<h2>The future of organic recycling</h2>
<p>Local council recycling and waste infrastructure is typically not a priority election issue, except for those close to existing or proposed landfills. </p>
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Read more:
<a href="https://theconversation.com/australian-recycling-plants-have-no-incentive-to-improve-81336">Australian recycling plants have no incentive to improve</a>
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<p>Ratepayers are generally not informed of the possibility of separately collecting food waste, either for industrial-scale composting or methane capture. We have the right to this information, with costs and benefits presented in the context of the costs we already pay for waste management, and relative to the environmental performance of landfill.</p>
<p>As an example, landfill operators often promote the number of homes they power by electricity generated from methane as a key measure of sustainability. But how does this compare to the electricity and heat that might be obtained from an anaerobic digester that processes the same waste? </p>
<p>Given the choice, the Australian community may have an appetite to extend organic recycling beyond well-established garden waste composting. They only have to be asked.</p><img src="https://counter.theconversation.com/content/82644/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>William Clarke has received funding from the Australian Research Council, the Queensland Government and Remondis Australia. He is a member of the Managing Board of the International Waste Working Group.</span></em></p><p class="fine-print"><em><span>Bernadette McCabe is a member of Bioenergy Australia and is National Team Leader for the International Energy Agency Task 37 Energy from Biogas</span></em></p>Landfills produce huge amounts of methane. Many of the bigger operators capture it to turn into energy, but they’re wasting about 80% of what’s available. It’s time Australia stepped up.William Clarke, Professor of waste management, The University of QueenslandBernadette McCabe, Associate Professor and Principal Scientist, University of Southern QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/630922016-08-09T22:58:49Z2016-08-09T22:58:49ZWhy utilities have little incentive to plug leaking natural gas<figure><img src="https://images.theconversation.com/files/133269/original/image-20160805-496-u7yoh9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The EPA has issued rules to regulate methane emission from new oil and gas wells in the face of industry and political pushback. </span> <span class="attribution"><span class="source">gas storage via www.shutterstock.com</span></span></figcaption></figure><p>The Aliso Canyon leak in California earlier this year focused public attention on methane emissions from the oil and gas industry. </p>
<p>Methane is the primary component of natural gas, and it is a potent contributor to climate change. In less than a year, the Aliso Canyon facility leaked methane equal to about four million metric <a href="https://theconversation.com/californias-aliso-canyon-methane-leak-climate-disaster-or-opportunity-53198">tons</a> of CO2, the greenhouse gas equivalent of driving over 800,000 cars in a <a href="https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator">year</a>.</p>
<p>But the problem of methane leakage was hardly news to environmentalists and regulators, who have been following the problem for years. Indeed, the EPA this year introduced regulations to <a href="https://www3.epa.gov/airquality/oilandgas/actions.html">limit methane emissions</a> from new oil and gas wells – and more initiatives are expected to be coming <a href="https://www.whitehouse.gov/the-press-office/2016/06/29/leaders-statement-north-american-climate-clean-energy-and-environment">down</a> the, er, <a href="https://www.whitehouse.gov/the-press-office/2015/01/14/fact-sheet-administration-takes-steps-forward-climate-action-plan-anno-1">pipeline</a>.</p>
<p>Methane leaks occur throughout the natural gas supply <a href="http://energy.gov/epsa/quadrennial-energy-review-qer">chain</a> – from the time it’s collected, stored and transported until its use in a power plant, factory, home or business. The leaks can be from aging pipelines, but also from poorly fitted components and from <a href="https://www3.epa.gov/gasstar/basic-information/">intentional venting</a> – a common practice in which gas is released directly into the atmosphere during maintenance.</p>
<p>The oil and gas industry has argued methane regulations are unnecessary and that the industry has <a href="http://www.api.org/news-policy-and-issues/letters-or-comments/2016/07/16/api-comments-on-epas-proposed-methane-ru">already reduced emissions</a>. For instance, a natural gas company might, quite rightly, point out that when natural gas is leaking from its system, it is losing valuable inventory, like a zoo with a hole in the fence. But, as I detail in recent <a href="http://www.nber.org/papers/w22261">research</a> – coauthored with <a href="https://econ.ucalgary.ca/profiles/lucija-muehlenbachs">Lucija Muehlenbachs</a> of the University of Calgary and Resources for the Future – this line of reasoning misses several key facts.</p>
<p>The lost value of leaked gas to a company is nowhere near the cost to society of the damages that same gas levies on the environment. This is a standard environmental externalities problem, straight out of an Econ 1 textbook. Because the company is not on the hook for the environmental damages, the natural gas company lacks the financial incentive to avoid a leak. This means environmental regulations, rather than leaving industry to self-regulate, are the best option for cutting emissions.</p>
<h2>Social costs of ‘fugitive’ methane</h2>
<p>The magnitude of the problem for leaked natural gas is astounding. Consider recent prices of natural gas: at different points in the supply chain, the commodity is worth between <a href="http://www.nasdaq.com/markets/natural-gas.aspx">two and five dollars per thousand cubic feet</a>. But the societal cost of leaked, noncombusted natural gas is higher. </p>
<p>Economists and government agencies use a metric called the <a href="https://www3.epa.gov/climatechange/EPAactivities/economics/scc.html">social cost of carbon</a> to represent the benefits of climate change-related policies. I used this metric but adjusted it to reflect the fact that each ton of methane traps much more heat than a ton of CO2. Overall, I calculate that the societal cost of a natural gas leak is US$27 per thousand cubic feet.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/133266/original/image-20160805-473-atuim1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Natural gas is transmitted long distance and then distributed to local lines, but local distributors have limited financial incentives to reduce leaks.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/bilfinger/14074154115/in/photolist-nrFHFz-nzMXYB-fjrWcD-f6PxBv-csti-iKuXA-8b4KxE-6sc6Aa-4AeUut-5YepdS-6mGUGF-hPKF48-r9uCF4-ofBUef-3cvyhg-6Ruhif-2jWNgP-DM4nxH-qjW1XZ-743HYo-dnFjL-pUKNar-51Uh2V-9CrTf3-bSif82-otT1KW-ft8LqW-fbLDyt-bSifg8-7RD78C-fjrWva-hSa9f-bDowqJ-9YdsJC-fbLDLP-bDow47-a9XrWQ-9Cp2kD-73YN6Z-fc1SyE-NXcpZ-7Kj3od-6DvRu-cCSaMy-o1a5h3-Agcra-8kYpUQ-4yPyjk-94ireT-mcuR3H">bilfinger/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
</figcaption>
</figure>
<p>So imagine that a technology exists that will prevent leaks, but it costs $10 per thousand cubic feet to implement. The private company won’t implement that technology, although it would be worthwhile for society based on the social costs of methane.</p>
<p>Since 2005, natural gas prices have fallen by <a href="http://www.nasdaq.com/markets/natural-gas.aspx?timeframe=10y">more than 50 percent</a>. Over the last 30 years, prices have been this low only a handful of times. This downward trend in prices, thanks largely to a domestic natural gas drilling boom, means the difference is growing between what a private company would be willing to spend to avoid methane leaks and what society would like to spend.</p>
<p>For a key portion of the natural gas supply chain, the private incentive to avoid natural gas leaks is even smaller. The final step in the supply chain is the distribution network, in which a firm – let’s call it “Local Gas Co” – brings natural gas from where a long-distance transmission line ends to your home or business. During my Michigan winters, I really appreciate the natural gas I can pipe into my home furnace. The company that provides this valuable service to me and other customers is typically regulated by a state-level agency called a public utility commission.</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/133271/original/image-20160805-470-17ih8ri.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">An underground natural gas pipeline in Georgia.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/98706376@N00/9397751811/in/photolist-fjrWcD-f9EYm4-vMQG5J-f9WcRY-fjG7tL-h8YWjx-f9HeKc-gTfYLM-fos1Zp-2jkGBX-foGiXm-fbBChB-f9Xujo-f9HfkR-f9Hfrg-owxhSa-p97uwY-4senFR-9K46xU-f9HdZk-fbBC8B-aPqHmB-gGrLGE-apEDxp-gKmtoL-fGc9fX-h4i6BK-f9FWNz-fbBCbH-fbRTGu-fbRTZS-f9VEmQ-f9VEaW-9AtmJU-gKmt5Q-df4TmW-f9EYtX-fbBCev-gKmrpW-gKmrT1-vNQ45p-vvKvwJ-fFf1xu-fFf11b-fGtN9U-2jq5MJ-9H6k8P-f9XsYw-fbBC5P-gGt5Vo">John S. Quarterman/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>Because a utility like Local Gas Co is typically the only company providing gas to a given region, public utility commissions impose certain legal restrictions, including the regulation of prices, to protect customers. This is a model that has, for the most part, worked well in natural gas and electricity markets. It wouldn’t make sense to have multiple companies running their own natural gas pipelines down Main Street, but if only one company is going to serve an area, then customers need to be protected from monopoly pricing.</p>
<p>In practice, for most companies, this means that every so often, they report their costs to a state-level public utility commission, which then sets retail prices so that the company covers its costs of delivering fuel to homes and businesses. And now recall that when Local Gas Co runs gas through its pipeline networks, there are leaks along the way. This could be from aging buried pipelines or from surface facilities, such as the stations that transfer gas from transmission pipes to local distribution pipes.</p>
<p>Historically, Local Gas Co would have reported the value of this lost gas to the public utility commission, and it would have been counted as “a cost of doing business.” That is, Local Gas Co is fully reimbursed for the value of the product they sell: customers like us are paying for it. This leaves Local Gas Co with little financial incentive to minimize leaks.</p>
<h2>Why markets won’t fix it</h2>
<p>It doesn’t have to be this way. </p>
<p>In our research, my coauthor and I point to cost-effective mitigation opportunities available to the distribution sector, such as repairing valves. But we estimate that the typical distribution company has ignored many of these opportunities. That’s not surprising, given the lack of financial incentive many of them face.</p>
<p>It’s worth noting that regulations are changing in some states. For example, reimbursement for the volume of leaked gas, in some places, is <a href="http://nrri.org/download/nrri-13-06-lost-and-unaccounted-for-gas/">capped</a>. </p>
<p>It’s also worth noting that safety regulations targeting aging networks are leading to major pipeline upgrades, and these replacements prevent some climate damages. But we estimate that pipeline replacements are substantially more expensive than other leak repair activities. That means they may be worth it for the safety benefits in some places, but on the climate change side, they are no substitute for leak detection and repair programs.</p>
<p>The overwhelming lesson we’ve taken from doing this research is that the price regulations we’ve relied on in the natural gas distribution sector are out of date given our current understanding of methane’s role in climate change. </p>
<p>Utility commissions and environmental regulators both face significant challenges going forward, such as attaining accurate and comprehensive measurement of methane leaks. But markets alone certainly won’t solve the problem.</p><img src="https://counter.theconversation.com/content/63092/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Catherine Hausman's research on methane leaks was funded by Resources for the Future, the National Bureau of Economic Research and the Sloan Foundation, and the Social Sciences and Humanities Research Council of Canada. In the past, she has received research funding from the Brookings Institution.</span></em></p>The Obama administration wants to regulate methane leaks from oil and gas operations. Here’s why we can’t count on market forces to make it work.Catherine Hausman, Assistant Professor of Public Policy, University of MichiganLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/407282015-04-24T04:23:27Z2015-04-24T04:23:27ZInfographic: emissions reduction auction results at a glance<figure><img src="https://images.theconversation.com/files/79223/original/image-20150424-14568-lbkwc1.jpg?ixlib=rb-1.1.0&rect=4%2C7%2C1014%2C646&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Growth industry: forestry will account for much of the carbon reductions under the first round of Emissions Reduction Fund contracts.</span> <span class="attribution"><span class="source">CSIRO/Wikimedia Commons</span>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span></figcaption></figure><p>The results of the government’s first <a href="https://theconversation.com/explainer-how-does-todays-direct-action-reverse-auction-work-40152">reverse auction</a> of carbon-cutting projects have been released. Where is the money going?</p>
<p>The government will spend A$660 million of its A$2.55 billion Emissions Reduction Fund on contracts set to reduce emissions by some 47 million tonnes, more than half of it in “carbon farming” projects to lock up carbon in vegetation.</p>
<p>Federal environment minister Greg Hunt <a href="http://www.abc.net.au/news/2015-04-23/government-buys-47m-tonnes-of-carbon-abatement-in-erf-auction/6415532">described the outcome</a> as a “stunning result” for Australia, pointing out that the average price of A$13.95 per tonne of carbon is cheaper than the previous government’s carbon pricing scheme.</p>
<p>But critics have pointed to the lack of involvement so far from industry sectors that were covered by the previous carbon tax, and the fact that the new scheme is paid for by taxpayers rather than the businesses creating the pollution.</p>
<p>Here are the numbers:</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=2943&fit=crop&dpr=1 600w, https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=2943&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=2943&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=3699&fit=crop&dpr=1 754w, https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=3699&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/79215/original/image-20150424-25563-y6ghno.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=3699&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
</figcaption>
</figure>
<p><strong>Review: Anita Talberg, Australian German College of Climate and Energy Transitions, University of Melbourne</strong></p>
<p>The Emissions Reduction Fund was legislated as an amendment to the existing Carbon Farming Initiative. It effectively expanded and tweaked the carbon farming scheme to include some projects outside the land sector. As Hunt <a href="http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22chamber%2Fhansardr%2Fb7c3903c-728e-40bc-91f4-728ffe55978d%2F0021%22">explained</a> when introducing the legislation to Parliament: “This bill will use positive incentives to reduce emissions, unlock economic activity, boost energy efficiency and improve agricultural productivity.” </p>
<p>This first auction has been effective in capturing the low end of the <a href="http://www.climateworksaustralia.org/sites/default/files/documents/publications/climateworks_lcgp_australia_summary_mar2010.pdf">marginal abatement cost curve</a> without dipping below the zero net-cost line (the point beyond which projects would “pay for themselves”, and therefore shouldn’t in theory be publicly funded). </p>
<p>However, as the final bar graph in this infographic shows, more than half of the purchased abatement is in the form of vegetation sequestration. So what this first auction has failed to do is unlock positive longer-term changes in energy efficiency, especially in the most carbon-intensive industries. </p>
<p>In essence, the land sector is offsetting emissions from the rest of the economy and delaying any real change to emissions intensity.</p>
<p>As the infographic’s carbon abatement task chart shows, there is still work to be done to meet Australia’s 2020 target. And in fact it may be more than is shown in that figure. The first projects purchased through the Emissions Reduction Fund have varying time frames, but many are between 7 and 10 years. Yet less than 6 years remain to meet our 2020 target. </p>
<p>Some of that abatement purchased through the Emissions Reduction Fund (the orange section in the graph) will occur after the 2020 deadline and may not count towards Australia’s international commitment.</p><img src="https://counter.theconversation.com/content/40728/count.gif" alt="The Conversation" width="1" height="1" />
The first round of contracts for Australia’s Emissions Reduction Fund have been awarded, at an average price of just under A$14 a tonne. How do the numbers stack up, and what projects are the big winners?James Whitmore, Deputy Editor: Arts + Culture, The ConversationMichael Hopkin, Deputy Chief of Staff, The ConversationEmil Jeyaratnam, Data + Interactives Editor, The ConversationLicensed as Creative Commons – attribution, no derivatives.