News round-up, May 22, 2023

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Has the energy sector enough coverage?

“It's imperative to maintain a broader perspective when it comes to the energy sector. Although there may be adequate coverage, we must be mindful of our natural inclination towards self-centeredness and disregard for the bigger picture. Constructing an objective viewpoint for ourselves and those around us is essential, and maintaining a global outlook is crucial.

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Most Read…

The U.S. Needs Minerals for Electric Cars. Everyone Else Wants Them Too.

The United States is entering an array of agreements to secure the critical minerals necessary for the energy transition, but it’s not clear which of the arrangements can succeed.

NYT By Ana Swanson, Reporting from Washington, May 21, 2023

Rice Gets Reimagined, From the Mississippi to the Mekong

The challenges rice farmers face in global warming are dire. The survival of billions hinges on successful rice harvests, making it imperative that we address the difficulties of climate change. The unpredictable weather patterns, ranging from droughts to floods, coupled with the salinity of the sea, are detrimental to the crop's growth. Plus, warmer nights contribute to diminishing yields. It is time we take action and aid our rice farmers in overcoming these obstacles.

NYT By Somini Sengupta, reporting from Arkansas and Bangladesh, and Tran Le Thuy, from Vietnam. Thanh Nguyen photographed in Vietnam and Rory Doyle in Arkansas, May 22 05 23.

EU hits Meta with record €1.2B privacy fine

Tech giant transferred Europeans’ data to the US unlawfully, Irish privacy regulator said.

POLITICO EU BY CLOTHILDE GOUJARD AND MARK SCOTT, MAY 22, 2023

Column: Spot LNG price drops to level that's not too hot, not too cold

The cost of LNG shipped to North Asia fell to $9.80 per million British thermal units (mmBtu) in the week ending May 19, marking its first dip beneath the $10 threshold in two years.

REUTERS By Clyde Russell/Editing by Germán & Co

EU Parliament delays renewable energy vote after late backlash

The EU needs help to pass a law requiring 42.5% of its energy from renewables by 2030. Some countries, including France, have yet to support the proposal.

REUTERS By Kate Abnett/EDITING BY GERMÁN & CO

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The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

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The Chaerhan Salt Lake in Golmud, China, where brine is processed to extract lithium and other minerals.Credit...Qilai Shen for The New York Times/Editing by Germán & Co

The U.S. Needs Minerals for Electric Cars. Everyone Else Wants Them Too.

The United States is entering an array of agreements to secure the critical minerals necessary for the energy transition, but it’s not clear which of the arrangements can succeed.

NYT By Ana Swanson, Reporting from Washington, May 21, 2023

For decades, a group of the world’s biggest oil producers has held huge sway over the American economy and the popularity of U.S. presidents through its control of the global oil supply, with decisions by the Organization of the Petroleum Exporting Countries determining what U.S. consumers pay at the pump.

As the world shifts to cleaner sources of energy, control over the materials needed to power that transition is still up for grabs.

China currently dominates global processing of the critical minerals that are now in high demand to make batteries for electric vehicles and renewable energy storage. In an attempt to gain more power over that supply chain, U.S. officials have begun negotiating a series of agreements with other countries to expand America’s access to important minerals like lithium, cobalt, nickel and graphite.

But it remains unclear which of these partnerships will succeed, or if they will be able to generate anything close to the supply of minerals the United States is projected to need for a wide array of products, including electric cars and batteries for storing solar power.

Leaders of Japan, Europe and other advanced nations, who are meeting in Hiroshima, agree that the world’s reliance on China for more than 80 percent of processing of minerals leaves their nations vulnerable to political pressure from Beijing, which has a history of weaponizing supply chains in times of conflict.

On Saturday, the leaders of the Group of 7 countries reaffirmed the need to manage the risks caused by vulnerable mineral supply chains and build more resilient sources. The United States and Australia announced a partnership to share information and coordinate standards and investment to create more responsible and sustainable supply chains.

“This is a huge step, from our perspective — a huge step forward in our fight against the climate crisis,” President Biden said Saturday as he signed the agreement with Australia.

But figuring out how to access all of the minerals the United States will need will still be a challenge. Many mineral-rich nations have poor environmental and labor standards. And although speeches at the G7 emphasized alliances and partnerships, rich countries are still essentially competing for scarce resources.

Japan has signed a critical minerals deal with the United States, and Europe is in the midst of negotiating one. But like the United States, those regions have substantially greater demand for critical minerals to feed their own factories than supply to spare.

Kirsten Hillman, Canada’s ambassador to the United States, said in an interview that the allied countries had an important partnership in the industry, but that they were also, to some extent, commercial competitors. “It is a partnership, but it’s a partnership with certain levels of tension,” she said.

“It’s a complicated economic geopolitical moment,” Ms. Hillman added. “And we are all committed to getting to the same place and we’re going to work together to do it, but we’re going to work together to do it in a way that’s also good for our businesses.”

“We have to create a market for the products that are produced and created in a way that is consistent with our values,” she said.

The State Department has been pushing forward with a “minerals security partnership,” with 13 governments trying to promote public and private investment in their critical mineral supply chains. And European officials have been advocating a “buyers’ club” for critical minerals with the G7 countries, which could establish certain common labor and environmental standards for suppliers.

Indonesia, which is the world’s biggest nickel producer, has floated the idea of joining with other resource-rich countries to make an OPEC-style producers cartel, an arrangement that would try to shift the power to mineral suppliers.

Indonesia has also approached the United States in recent months seeking a deal similar to that of Japan and the European Union. Biden administration officials are weighing whether to give Indonesia some kind of preferential access, either through an independent deal or as part of a trade framework the United States is negotiating in the Indo-Pacific.

But some U.S. officials have warned that Indonesia’s lagging environmental and labor standards could allow materials into the United States that undercut the country’s nascent mines, as well as its values. Such a deal is also likely to trigger stiff opposition in Congress, where some lawmakers criticized the Biden administration’s deal with Japan.

Jake Sullivan, the national security adviser, hinted at these trade-offs in a speech last month, saying that carrying out negotiations with critical mineral-producing states would be necessary, but would raise “hard questions” about labor practices in those countries and America’s broader environmental goals.

Whether America’s new agreements would take the shape of a critical minerals club, a fuller negotiation or something else was unclear, Mr. Sullivan said: “We are now in the thick of trying to figure that out.”

Cullen Hendrix, a senior fellow at the Peterson Institute for International Economics, said the Biden administration’s strategy to build more secure international supply chains for minerals outside of China had so far been “a bit incoherent and not necessarily sufficient to achieve that goal.”

The demand for minerals in the United States has been spurred in large part by President Biden’s climate law, which provided tax incentives for investments in the electric vehicle supply chain, particularly in the final assembly of batteries. But Mr. Hendrix said the law appeared to be having more limited success in rapidly increasing the number of domestic mines that would supply those new factories.

“The United States is not going to be able to go this alone,” he said.

Biden officials agree that obtaining a secure supply of the minerals needed to power electric vehicle batteries is one of their most pressing challenges. U.S. officials say that the global supply of lithium alone needs to increase by 42 times by 2050 to meet the rising demand for electric vehicles.

Ford’s electric pickup truck on the production line of the company’s plant in Dearborn, Mich.Credit...Brittany Greeson for The New York Times

While innovations in batteries could reduce the need for certain minerals, for now, the world is facing dramatic long-term shortages by any estimate. And many officials say Europe’s reliance on Russian energy following the invasion of Ukraine has helped to illustrate the danger of foreign dependencies.

The global demand for these materials is triggering a wave of resource nationalism that could intensify. Outside of the United States, the European Union, Canada and other governments have also introduced subsidy programs to better compete for new mines and battery factories.

Indonesia has progressively stepped up restrictions on exporting raw nickel ore, requiring it to first be processed in the country. Chile, a major producer of lithium, nationalized its lithium industry in a bid to better control how the resources are developed and deployed, as have Bolivia and Mexico.

And Chinese companies are still investing heavily in acquiring mines and refinery capacity globally.

For now, the Biden administration has appeared wary of cutting deals with countries with more mixed labor and environmental records. Officials are exploring changes needed to develop U.S. capacity, like faster permitting processes for mines, as well as closer partnerships with mineral-rich allies, like Canada, Australia and Chile.

On Saturday, the White House said it planned to ask Congress to add Australia to a list of countries where the Pentagon can fund critical mineral projects, criteria that currently only applies to Canada.

Todd Malan, the chief external affairs officer at Talon Metals, which has proposed a nickel mine in Minnesota to supply Tesla’s North American production, said that adding a top ally like Australia, which has high standards of production regarding environment, labor rights and Indigenous participation, to that list was a “smart move.”

But Mr. Malan said that expanding the list of countries that would be eligible for benefits under the administration’s new climate law beyond countries with similar labor and environmental standards could undermine efforts to develop a stronger supply chain in the United States.

“If you start opening the door to Indonesia and the Philippines or elsewhere where you don’t have the common standards, we would view that as outside the spirit of what Congress was trying to do in incentivizing a domestic and friends supply chain for batteries,” he said.

However, some U.S. officials argue that the supply of critical minerals in wealthy countries with high labor and environmental standards will be insufficient to meet demand, and that failing to strike new agreements with resource-rich countries in Africa and Asia could leave the United States highly vulnerable.

While the Biden administration is looking to streamline the permitting process in the United States for new mines, getting approval for such projects can still take years, if not decades. Auto companies, which are major U.S. employers, have also been warning of projected shortfalls in battery materials and arguing for arrangements that would give them more flexibility and lower prices.

The G7 nations, together with the countries with which the United States has free trade agreements, produce 30 percent of the world’s lithium chemicals and about 20 percent of its refined cobalt and nickel, but only 1 percent of its natural flake graphite, according to estimates by Adam Megginson, a price analyst at Benchmark Mineral Intelligence.

Jennifer Harris, a former Biden White House official who worked on critical mineral strategy, argued that the country should move more quickly to develop and permit domestic mines, but that the United States also needs a new framework for multinational negotiations that include countries that are major mineral exporters.

The government could also set up a program to stockpile minerals like lithium when prices swing low, which would give miners more assurance they will find destinations for their products, she said.

“There’s so much that needs doing that this is very much a ‘both/and’ world,” she said. “The challenge is that we need to responsibly pull up a whole lot more rocks out of the ground yesterday.”

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Rice Gets Reimagined, From the Mississippi to the Mekong

The challenges rice farmers face in global warming are dire. The survival of billions hinges on successful rice harvests, making it imperative that we address the difficulties of climate change. The unpredictable weather patterns, ranging from droughts to floods, coupled with the salinity of the sea, are detrimental to the crop's growth. Plus, warmer nights contribute to diminishing yields. It is time we take action and aid our rice farmers in overcoming these obstacles.

NYT By Somini Sengupta, reporting from Arkansas and Bangladesh, and Tran Le Thuy, from Vietnam. Thanh Nguyen photographed in Vietnam and Rory Doyle in Arkansas, May 22 05 23.

Rice is in trouble as the Earth heats up, threatening the food and livelihood of billions of people. Sometimes there’s not enough rain when seedlings need water, or too much when the plants need to keep their heads above water. As the sea intrudes, salt ruins the crop. As nights warm, yields go down.

These hazards are forcing the world to find new ways to grow one of its most important crops. Rice farmers are shifting their planting calendars. Plant breeders are working on seeds to withstand high temperatures or salty soils. Hardy heirloom varieties are being resurrected.

And where water is running low, as it is in so many parts of the world, farmers are letting their fields dry out on purpose, a strategy that also reduces methane, a potent greenhouse gas that rises from paddy fields.

The climate crisis is particularly distressing for small farmers with little land, which is the case for hundreds of millions of farmers in Asia. “They have to adapt,” said Pham Tan Dao, the irrigation chief for Soc Trang, a coastal province in Vietnam, one of the biggest rice-producing countries in the world. “Otherwise they can’t live.”

In China, a study found that extreme rainfall had reduced rice yields over the past 20 years. India limited rice exports out of concern for having enough to feed its own people. In Pakistan, heat and floods destroyed harvests, while in California, a long drought led many farmers to fallow their fields.

Worldwide, rice production is projected to shrink this year, largely because of extreme weather.

Today, Vietnam is preparing to take nearly 250,000 acres of land in the Mekong Delta, its rice bowl, out of production. Climate change is partly to blame, but also dams upstream on the Mekong River that choke the flow of freshwater. Some years, when the rains are paltry, rice farmers don’t even plant a third rice crop, as they had before, or they switch to shrimp, which is costly and can degrade the land further.

The challenges now are different from those 50 years ago. Then, the world needed to produce much more rice to stave off famine. High-yielding hybrid seeds, grown with chemical fertilizers, helped. In the Mekong Delta, farmers went on to produce as many as three harvests a year, feeding millions at home and abroad.

Today, that very system of intensive production has created new problems worldwide. It has depleted aquifers, driven up fertilizer use, reduced the diversity of rice breeds that are planted, and polluted the air with the smoke of burning rice stubble. On top of that, there’s climate change: It has upended the rhythm of sunshine and rain that rice depends on.

Perhaps most worrying, because rice is eaten every day by some of the world’s poorest, elevated carbon dioxide concentrations in the atmosphere deplete nutrients from each grain.

Rice faces another climate problem. It accounts for an estimated 8 percent of global methane emissions. That’s a fraction of the emissions from coal, oil and gas, which together account for 35 percent of methane emissions. But fossil fuels can be replaced by other energy sources. Rice, not so much. Rice is the staple grain for an estimated three billion people. It is biryani and pho, jollof and jambalaya — a source of tradition, and sustenance.

“We are in a fundamentally different moment,” said Lewis H. Ziska, a professor of environmental health sciences at Columbia University. “It’s a question of producing more with less. How do you do that in a way that’s sustainable? How do you do that in a climate that’s changing?”

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A risky balance: Rice, or shrimp?

In 1975, facing famine after war, Vietnam resolved to grow more rice.

It succeeded spectacularly, eventually becoming the world’s third-largest rice exporter after India and Thailand. The green patchwork of the Mekong Delta became its most prized rice region.

At the same time, though, the Mekong River was reshaped by human hands.

Starting in southeastern China, the river meanders through Myanmar, Laos, Thailand and Cambodia, interrupted by many dams. Today, by the time it reaches Vietnam, there is little freshwater left to flush out seawater seeping inland. Rising sea levels bring in more seawater. Irrigation canals turn salty. The problem is only going to get worse as temperatures rise.

“We now accept that fast-rising salty water is normal,” said Mr. Pham, the irrigation chief. “We have to prepare to deal with it.” Where saltwater used to intrude 30 kilometers or so (about 19 miles) during the dry season, he said, it can now reach 70 kilometers inland.

Climate change brings other risks. You can no longer count on the monsoon season to start in May, as before. And so in dry years, farmers now rush to sow rice 10 to 30 days earlier than usual, researchers have found. In coastal areas, many rotate between rice and shrimp, which like a bit of saltwater.

But this requires reining in greed, said Dang Thanh Sang, 60, a lifelong rice farmer in Soc Trang. Shrimp bring in high profits, but also high risks. Disease sets in easily. The land becomes barren. He has seen it happen to other farmers.

So, on his seven acres, Mr. Dang plants rice when there’s freshwater in the canals, and shrimp when seawater seeps in. Rice cleans the water. Shrimp nourishes the soil. “It’s not a lot of money like growing only shrimp,” he said. “But it’s safer.”

Elsewhere, farmers will have to shift their calendars for rice and other staple grains, researchers concluded in a recent paper. Scientists are already trying to help them.

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Secrets of ancient rice

The cabinet of wonders in Argelia Lorence’s laboratory is filled with seeds of rice — 310 different kinds of rice.

Many are ancient, rarely grown now. But they hold genetic superpowers that Dr. Lorence, a plant biochemist at Arkansas State University, is trying to find, particularly those that enable rice plants to survive hot nights, one of the most acute hazards of climate change. She has found two such genes so far. They can be used to breed new hybrid varieties.

“I am convinced,” she said, “that decades from now, farmers are going to need very different kinds of seeds.”

Dr. Lorence is among an army of rice breeders developing new varieties for a hotter planet. Multinational seed companies are heavily invested. RiceTec, from which most rice growers in the southeastern United States buy seeds, backs Dr. Lorence’s research.

She is focused on divining valuable genetic traits hidden in the many varieties.

Critics say hybrid seeds and the chemical fertilizers they need make farmers heavily dependent on the companies’ products, and because they promise high yields, effectively wipe out heirloom varieties that can be more resilient to climate hazards.

The new frontier of rice research involves Crispr, a gene-editing technology that U.S. scientists are using to create a seed that produces virtually no methane. (Genetically modified rice remains controversial, and only a handful of countries allow its cultivation.)

In Bangladesh, researchers have produced new varieties for the climate pressures that farmers are dealing with already. Some can grow when they’re submerged in floodwaters for a few days.

Others can grow in soils that have turned salty. In the future, researchers say, the country will need new rice varieties that can grow with less fertilizer, which is now heavily subsidized by the state. Or that must tolerate even higher salinity levels.

No matter what happens with the climate, said Khandakar M. Iftekharuddaula, chief scientific officer at the Bangladesh Rice Research Institute, Bangladesh will need to produce more. Rice is eaten at every meal. “Rice security is synonymous with food security,” he said.

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Less watery rice paddies?

Rice is central to the story of the United States. It enriched the coastal states of the American South, all with the labor of enslaved Africans who brought with them generations of rice-growing knowledge.

Today, the country’s dominant rice-growing area is spread across the hard clay soil near where the Mississippi River meets one of its tributaries, the Arkansas River. It looks nothing like the Mekong Delta. The fields here are laser-leveled flat as pancakes. Work is done by machine. Farms are vast, sometimes more than 20,000 acres.

What they share are the hazards of climate change. Nights are hotter. Rains are erratic. And there’s the problem created by the very success of so much intensive rice farming: Groundwater is running dangerously low.

Enter Benjamin Runkle, an engineering professor from the University of Arkansas at Fayetteville. Instead of keeping rice fields flooded at all times, as growers have always done, Dr. Runkle suggested that Arkansas farmers let the fields dry out a bit, then let in the water again, then repeat. Oh, and would they let him measure the methane coming off their fields?

Mark Isbell, a second-generation rice farmer, signed up.

New irrigation ideas can save water and cut methane emissions.

Dr. Runkle: “A breathalyzer test of the land.”

On the edge of Mr. Isbell’s field, Dr. Runkle erected a tall white contraption that an egret might mistake for a cousin. The device measured the gases produced by bacteria stewing in the flooded fields. “It’s like taking a breathalyzer test of the land,” Dr. Runkle said.

His experiment, carried out over seven years, concluded that by not flooding the fields continuously, farmers can reduce rice methane emissions by more than 60 percent.

Other farmers have taken to planting rice in rows, like corn, and leaving furrows in between for the water to flow. That, too, reduces water use and, according to research in China, where it’s been common for some time, cuts methane emissions.

The most important finding, from Mr. Isbell’s vantage point: It reduces his energy bills to pump water. “There are upsides to it beyond the climate benefits,” he said.

By cutting his methane emissions, Mr. Isbell was also able to pick up some cash by selling “carbon credits,” which is when polluting businesses pay someone else to make emissions cuts.

When neighbors asked him how that went, he told them he could buy them a drink and explain. “But it will have to be one drink,” he said. He made very little money from it.

However, there will be more upsides soon. For farmers who can demonstrate emissions reductions, the Biden administration is offering federal funds for what it calls “climate smart” projects. Agriculture Secretary Tom Vilsack came to Mr. Isbell’s farm last fall to promote the program. Mr. Isbell reckons the incentives will persuade other rice growers to adopt alternate wetting and drying.

“We kind of look over the hill and see what’s coming for the future, and learn now,” said his father, Chris Isbell.

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It's the largest fine imposed under the bloc's flagship General Data Protection Regulation | John Edelson/EAFP/Editing by Germán & Co

EU hits Meta with record €1.2B privacy fine

Tech giant transferred Europeans’ data to the US unlawfully, Irish privacy regulator said.

POLITICO EU BY CLOTHILDE GOUJARD AND MARK SCOTT, MAY 22, 2023

U.S tech giant Meta has been hit with a record €1.2 billion fine for not complying with the EU’s privacy rulebook.

The Irish Data Protection Commission announced on Monday that Meta violated the General Data Protection Regulation (GDPR) when it shuttled troves of personal data of European Facebook users to the United States without sufficiently protecting them from Washington's data surveillance practices.

It's the largest fine imposed under the bloc's flagship General Data Protection Regulation (GDPR) privacy law and it comes on the eve of the fifth anniversary of the law's enforcement on May 25.

Amazon was previously fined €746 million by Luxembourg and the Irish regulator also imposed four fines against Meta's platforms Facebook, Instagram and WhatsApp ranging between €405 million and €225 million in the past two years.

Ywatchdog said that Meta's use of a legal instrument known as standard contractual clauses (SCCs) to move data to the U.S. "did not address the risks to the fundamental rights and freedoms" of Facebook's European users raised by a landmark ruling from the EU's top court.

The European Court of Justice in 2020 struck down an EU-U.S. data flows agreement known as the Privacy Shield over fears of U.S. intelligence services' surveillance practices. In the same judgment, the top EU court also tightened requirements to use SCCs, another legal tool widely used by companies to transfer personal data to the U.S.

Meta — as well as other international companies — kept relying on the legal instrument as European and U.S. officials struggled to put together a new data flows arrangement and the U.S. tech giant lacked other legal mechanisms to transfer its personal data.

The EU and U.S. are finalizing a new data flow deal that could come as early as July and as late as October. Meta has until October 12 to stop relying on SCCs for their transfers.

The U.S. tech giant previously warned that if it would be forced to stop using SCCs without a proper alternative data flow agreement in place, it could shut down services like Facebook and Instagram in Europe.

Meta also has until November 12 to delete or move back to the EU the personal data of European Facebook users transferred and stored in the U.S. since 2020 and until a new EU-U.S. deal is reached.

“This decision is flawed, unjustified and sets a dangerous precedent for the countless other companies transferring data between the EU and U.S.," Meta's President of Global Affairs Nick Clegg and Chief Legal Officer Jennifer Newstead said in a statement on Monday.

Clegg and Newstead said the company will appeal the decision and seek a stay with the courts to pause the implementation deadlines. "There is no immediate disruption to Facebook because the decision includes implementation periods that run until later this year," they added.

Max Schrems, the privacy activist behind the original 2013 complaint supporting the case, said: "We are happy to see this decision after ten years of litigation ... Unless U.S. surveillance laws get fixed, Meta will have to fundamentally restructure its systems."

The Irish Data Protection Commission said it disagreed with the fine and measure that it was imposing on Meta but had been forced by the pan-European network of national regulators, the European Data Protection Board (EDPB), after Dublin's initial decision was challenged by four of its peer regulators in Europe.

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Seaboard: pioneers in power generation in the country…

…“More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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A liquified natural gas (LNG) tanker leaves the dock after discharge at PetroChina's receiving terminal in Dalian, Liaoning province, China July 16, 2018. REUTERS/Chen Aizhu/File Photo/Editing by Germán & Co

Column: Spot LNG price drops to level that's not too hot, not too cold

The cost of LNG shipped to North Asia fell to $9.80 per million British thermal units (mmBtu) in the week ending May 19, marking its first dip beneath the $10 threshold in two years.

REUTERS By Clyde Russell/Editing by Germán & Co

LAUNCESTON, Australia, May 22 (Reuters) - The spot price of liquefied natural gas (LNG) in Asia is in the sweet spot of being low enough to boost buying interest, but not so low that it sparks a surge in demand.

The price for LNG delivered to north Asia dropped to $9.80 per million British thermal units (mmBtu) in the week to May 19, its first foray below the $10 level in two years.

The price has slid 74% since its northern winter peak of $38 per mmBtu on Dec. 16, and is down 86% from the record high of $70.50, hit in August last year as Europe sucked up all available cargoes amid fears of the total loss of Russian pipeline supplies.

The decline in spot LNG prices has seen demand in key Asian importers hold steady, according to data compiled by commodity analysts Kpler.

Asia is expected to import 20.81 million tonnes of the super-chilled fuel in May, the same result as was recorded in April and down slightly from March's 22.16 million.

While a steady-as-she-goes outcome may seem somewhat disappointing at first glance, especially given the price decline, it's actually stronger than appearances given that LNG is in the shoulder period of seasonally weaker demand between the peaks of the northern winter and summer.

The seasonal softness can be seen in Japan's May imports dropping to an expected 4.24 million tonnes from 5.0 million in April and 5.55 million in March.

Japan reclaimed the title of the world's biggest LNG importer from China last year, as Chinese utilities largely opted out of the spot market when prices surged following Russia's invasion of Ukraine.

Chinese buyers have returned to the market, but their purchases have been modest so far in 2023, with an estimated 5.23 million tonnes slated to arrive in May, little changed from April's 5.33 million and 5.46 million in March.

It's believed that Chinese utilities require a spot price below $10 per mmBtu in order for LNG to be competitive in the domestic market, so the decline below this level last week may act to spur some new buying interest in coming weeks.

The price-sensitive LNG buyers in South Asia have also been returning to the spot market in recent months, with India, the fourth-largest importer in Asia, expected to land 1.91 million tonnes in May.

This is slightly down from 1.98 million in April, but up from March's 1.84 million and also well above the 1.46 million in January and the 1.32 million in December, when spot prices were still elevated.

However, it's likely that the decline in spot prices will only boost demand from June onwards, and there are some early signs that this is already happening.

LNG imports by Asia, Europe vs spot price:

JUNE PICK-UP

Preliminary June imports for Asia are assessed by Kpler at 19.36 million tonnes, almost matching the May figure, which is a robust signal given the certainty that more cargoes will be assessed in coming weeks.

The lower spot price in Asia is also working to boost buying interest in Europe, with May imports expected at 12.28 million tonnes, up a smidgeon from April's 12.27 million.

Spot LNG prices in Asia are at competitive levels with the main benchmarks in Europe, with the benchmark British day-ahead contract ending at 66.75 pence per therm on May 19, equivalent to $8.18 per mmBtu.

The Dutch TTF front-month contract ended last week at 30.30 euros per megawatt hour, equivalent to about $9.62 mmBtu.

The question for the market is at what point the spot price for LNG in Asia falls far enough to provide a significant boost to buying, especially given the summer demand peak is coming.

The forward curve for LNG futures traded in New York suggests that point is soon, with the curve in contango and the July contract ending at $10.35 per mmBtu on May 19, while August was higher still at $11.11.

The opinions expressed here are those of the author, a columnist for Reuters

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European Union flags fly outside the European Commission headquarters in Brussels, Belgium, March 1, 2023.REUTERS/Johanna Geron

EU Parliament delays renewable energy vote after late backlash

The EU needs help to pass a law requiring 42.5% of its energy from renewables by 2030. Some countries, including France, have yet to support the proposal.

REUTERS By Kate Abnett/EDITING BY GERMÁN & CO

BRUSSELS, May 22 (Reuters) - The European Parliament has delayed a planned vote to approve new EU renewable energy targets, after France and other countries lodged last-minute opposition to the law last week, according to an internal email seen by Reuters.

The vote in the Parliament's energy committee had been due to take place on Tuesday. The email said the vote was postponed until June, without specifying a date.

The European Union is attempting to finalise a key pillar of its climate agenda - a law containing a binding goal for the EU to get 42.5% of its energy from renewable sources by 2030.

But the bill has run into late resistance. EU country diplomats had been due to signal their approval for the law last week, but the discussion was shelved after France and other countries said they would not support it.

Parliament had been due to hold a first vote on Tuesday, followed by a final vote in July. A delay risks shelving the policy's approval until September, after the EU assembly's summer recess.

The EU Parliament and EU countries' approval of the law was supposed to be a formality, after negotiators from both sides agreed what was supposed to be a final deal earlier this year.

But France was unhappy with the final result. Paris wants more recognition in the law of low-carbon nuclear energy, and says the rules discriminate against hydrogen produced from nuclear power, by not allowing countries to count this low-carbon fuel towards renewable fuel targets for industry.

Other countries, including Bulgaria, Romania, Poland, were also unhappy with the rules, for a range of reasons including that some capitals view the targets as overly ambitious.

A spokesperson for Sweden, which holds the EU's rotating presidency, said talks were underway to resolve the dispute.

But other countries are impatient, after what some diplomats described as a "surprise" hold-up of one of the bloc's main tools to fight climate change.

"The level of frustration is extremely high indeed. France is always asking for more," one EU diplomat said.

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Former coal-fired power plant hosts new battery project

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An aerial view of Ferrybridge, West Yorkshire, UK, where SSE Renewables plans to build a battery at the site of its former coal plant. Credit: LD Media UK./Editing by Germán & Co

SSE Renewables is the latest example of an energy company looking to redevelop coal plants and mines into net-zero projects.

energymonitor.ai By Florence Jones

SSE Renewables has announced plans to develop a 150MW battery storage facility on the site of a former coal-fired power plant in West Yorkshire in the north of the UK. The conversion of former coal plants into net-zero projects has become a growing area of interest as renewable developers can benefit from pre-existing infrastructure and workforces.

In this case, SSE Renewables decommissioned the coal plant in question (Ferrybridge) in 2016. Construction on the battery plant is due to begin later this month with Ferrybridge’s reconnection to the grid confirmed for June 2024. Sungrow Power Supply will supply battery technology alongside construction partner OCU services. Lewis Li, president of Sungrow Europe, said that it will provide its “liquid cooled energy storage system, the PowerTitan, to this landmark project”.

The conversion of coal power plants to net zero

In the US earlier this year, $160m (£127.63m) in initial funding from the Advanced Reactor Demonstration Program (ARDP) was awarded to TerraPower and X-Energy to build two advanced nuclear reactors that will be operational before 2028. Both companies have said they are looking at coal plant-to-nuclear conversion.

Funding is booming for spacetech companies that are developing new technologies. Masdar City in the United Arab Emirates is offering these start-ups an ecosystem where they can grow and thrive The Emirates Mars Mission, also known as the Hope Probe,…

Additionally, in the UK, a number of disused coal mines have been recommissioned to provide heating to nearby homes and businesses. Water can be heated in the pre-existing mine networks, which can offer a sustainable alternative to gas boilers. The UK Government has set a target of no new gas boilers in new-build housing and businesses by 2025.

Drax, now the largest renewables developer in the UK, announced last month that its power plant in North Yorkshire will no longer use coal. Instead “sustainable biomass” will be used to power the plant. The company is also looking to install carbon capture and storage, according to Will Gardiner, Drax’s CEO.

“The global momentum for converting coal-fired power stations to biomass is growing as more countries work to reduce their emissions by moving away from fossil fuels to renewables while maintaining their energy security. In recent months, new projects have been announced in countries from Japan to Hungary,” Gardiner added.

According to Richard Cave-Bigley, director of solar and battery at SSE renewables, the new battery storage project “located next to the former Ferrybridge coal power station” clearly demonstrates “the transition to net zero while supporting new green jobs”. SSE renewables will develop the site as part of its $31bn Net Zero Acceleration Programme. SSE Renewables has almost 2GW of battery and solar projects currently in development or under construction.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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War and love kisses…

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Shalom,

My dear friends, and have a pleased Shabbat to all of you. I hope you are doing well and enjoying this beautiful day with your loved ones. I wish you all the best in love and health, as those are the most important things in life. It would be interesting to share the history of kisses while we're about love. While kisses can occasionally be bitter and painful, they can also be sweet and passionate. Nonetheless, they are integral to human expression and have been around for millions of years.  So, let's take a journey through time and explore the fascinating world of kisses (The earliest recorded kiss goes back at least 4,500 years to Mesopotamia…) and of the war (Military reasons why Ukraine will not be defeated: a ground operations perspective…) together.

Cheers...

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Foreword…

Love Kisses…

The Italian philosopher of love and erotism, Alberto Alberoni (born 31 December 1929 in Borgonovo Val Tidone, Piacenza, Italy), was a man of many contradictions. He was both a warrior and a lover, a fierce defender of his beliefs and a passionate advocate for the power of love. His writings about war and its effects on society were insightful and thought-provoking, but his musings on the nature of love truly captured the hearts and minds of his millions of readers. Indeed, the effects of the violence of war and love kisses are very different. War causes devastation, anarchy, and suffering. Contrarily, love offers warmth, comfort, and delight. But what happens when the two collide? It's a strange and confusing feeling, like being caught in the crossfire of opposing forces. It's that feeling of wanting to love someone but being afraid to get hurt. It's the feeling of wanting to fight for what you believe in but not wanting to harm those you love. It's a delicate balance that requires patience, understanding, and a willingness to compromise. But if you can find that balance, if you can learn to love and fight at the same time, then you'll indeed be unstoppable. It's hard to predict what the future holds for this issue. But one thing's for sure - we must go through chaos to reach a state of peace. It may be challenging...

The War…

In their ancestral conflict, somebody must be defeated Russia or Ukraine. Sadly, is this the only solution to the world's problems? Everything indicates that yes, if we take into consideration the latest news of the G7 coming paradoxically from the island of Hiroshima in Japan. The confrontation between Russia and Ukraine has gotten out of hand, may be from the beginning.

Why?

Megalomania produces blindness, leading to delusions of grandeur and false realities. This is why megalomania blinds those who suffer from it and prevents them from a genuine connection with reality. Everything remains on the surface of the imagination. And this is the case with President Vladimir Putin. This mental health condition prevented him from genuinely analysing the risks of the invasion of Ukraine. Perhaps President Putin envisaged that a significant part of the world's nations would join the Ukrainian cause. Even Russia's friendly countries have been very reserved in their positions about the conflict.

It's important to remember that many complex and varied issues affect our world beyond just one regional military conflict. This battle has unfortunately distracted us from finding lasting solutions to problems like poverty, climate change, terrorism, and inequality that require global cooperation….

How long could it possibly take to bring about peace?

It's hard to predict what the future holds for this issue. But one thing's for sure - we must go through chaos to reach a state of peace. It may not be easy...

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Image by Germán & Co

Military reasons why Ukraine will not be defeated: a ground operations perspective…

Professor, International University of Japan, Noboru Yamaguchi, Military History and Strategy, International Security Policy and Strategy, Japan-U.S. Alliance.

A little more than a year after Russia invaded Ukraine on February 24, 2022, there are still no signs that Ukraine will be defeated. At the start of the war, Russian forces rapidly closed on the Ukrainian capital of Kyiv, and Ukraine’s fate was in doubt. However, the Ukrainians held firm, and on April 6, only six weeks after the war began, a senior U.S. Defense Department official revealed the official position that Russian forces had completely withdrawn from the front of Kyiv.[1] Why is it that Russia, which was seen as overwhelmingly superior, is unexpectedly struggling, and conversely, the Ukrainian military is exceeding expectations in its performance? This article will examine this question while focusing on ground operations in the traditional sense. It is important to note that Ukraine is fighting well in the information and cyber domains as well, but these issues will be examined on a separate occasion.

International support

International support from Western countries, the backdrop of Ukraine’s performance, should not be overlooked. It is not widely known, but NATO countries and other Western societies have supported Ukraine in various ways since Russia annexed Crimea in 2014. For example, the U.S. sent a total of 364 personnel on military aid missions to Ukraine in 2015, immediately after the annexation of Crimea, including 310 training support personnel.[2] In 2021, the year before the Russian invasion, a military advisory group of 200 Canadians, 30 Lithuanians, 40 Poles, and 150 Americans helped train and modernize the Ukrainian army.[3] That support has greatly expanded since the invasion last year, including the provision of enormous amounts of weapons and ammunition. According to press reports, as of last fall, the U.S. had already provided more than $16.8 billion in military assistance.[4] In the broader context of information and cyber warfare, Western government agencies as well as information companies like Microsoft and Amazon have been assisting Ukraine primarily in the areas of training personnel for cyber security, institutional reform, and system strengthening in order to strengthen Ukraine's cyber defense capabilities.[5]

Demographics and troop replacement

In both Russia and Ukraine, as in Japan, the birthrate is declining and the younger population cohort is aging, so recruiting soldiers is not always easy. Despite this, many high-ranking officers in the Russian military have led operations with a disregard for human life, based on the mistaken belief that the human resources available to replenish the military are inexhaustible.[6] It has been noted since the mid-2010s that the Russian military has had serious problems recruiting soldiers. The demographic pressure of a declining youth population, the reduction of the conscription period to one year, and the introduction of a volunteer army system aimed at training professional soldiers have made recruitment difficult for the Russian armed forces. The fill rate for each service was as low as 82% as of 2014. Despite a slight turnaround since then, the volunteer recruitment targets set in the initial period of military modernization have not been met, and as a result, about one-third of soldiers are still conscripts who have received little training.[7] Russia's total population in 2020 was about 146 million with a fertility rate (birth per woman) of 1.51, similar to Japan's population of about 126 million with a fertility rate of 1.34. In such a society, if operational command is executed without regard to the loss of soldiers, recruitment will naturally become difficult. Moreover, it will lower the morale of soldiers and result in the loss of trust and support from the families of the soldiers, in other words, the people, for the military.

Ukraine has experienced demographics similar to those in Russia and has had problems with the high turnover of military personnel. Ironically, because of this problem, there are many young people among the general public who have received serious military training, and as a result, they have made an additional de facto reserve force.[8] Thus, in formulating its invasion plan, the Russian military made the mistake of underestimating Ukraine's mobilization capacity.

Wartime leadership and operational command

The International Institute for Strategic Studies, a British think tank, says the main reasons Russia is struggling are overconfidence in its own forces and underestimating its enemy.[9] Russia deployed 150,000 troops at the start of the war, but it clearly overreached in its objective. Russia's invasion plan envisioned a short decisive battle—a blitzkrieg so to speak—based on the premise that Ukraine would be overthrown within 10 days of the outbreak of war and the entire country would be pacified and annexed by August. The early capture of Kyiv would force the Ukrainian leadership to flee and the state would collapse. There was also the optimistic scenario that the pro-Russia population in Ukraine would support the Russian military as it advanced. From the Marco Polo Bridge Incident of 1937 until the end of World War II in 1945, the Japanese military deployed up to over one million troops in northern China, and area roughly the size of Ukraine. However, it could only control major towns on and areas around rail lines—in other words, points and lines. It was impossible to control a country 1.5 times the size of Japan with just over half the number of troops of the modern Self-Defense Forces.

At the tactical level, the Ukrainian military appears to be outperforming the Russian military in operational command. Since the beginning of the war, both sides have stressed the leadership of junior commanders. It is said that the Russian military gave 127 Battalion Tactical Groups (BTGs) areas of operation and tasks to accomplish during the invasion. A BTG consists of 600-800 men and is a compact but independent unit with several infantry companies as well as artillery, air defense, engineering, and logistical support functions. The aim of this formation is for relatively small units to disperse and maneuver autonomously to quickly settle the battle under fluid conditions. The keys to this, however, are the judgment of the junior commanders in the smaller units under the battalion commander and information-sharing among the dispersed units. More simply put, a BTG is an organization that relies on the abilities of junior and non-commissioned officers. Unlike the armies of the U.S. and NATO countries, this formation is not suitable for the Russian military, which lacks professional volunteer soldiers. As a result, it has been observed that the Russian military itself has abandoned this concept.[10]

Since 2014, Ukrainian forces have been engaging Russian troops for nearly a decade, albeit at low intensity. During this period, preparations have always been made with an escalation (i.e., a large-scale invasion) by Russian forces in mind. In particular, mid- and junior-ranked officers have been rotated to several fronts and tasked with becoming familiar with the terrain of each front and the tactics of the Russians.[11] In addition, Air Force fighter pilots were repeatedly trained to fly at very low altitudes over their own country in preparation for action under Russian air superiority from the beginning of an escalation, and they were well versed in the terrain before the actual battle. The difference with the Russian soldiers, who, to keep battle plans secret, were not even informed of their participation in the actual battle, to say nothing of the situation at the front where they would be deployed, is significant.

High-tech and legacy weapons

Among the Western support, it seems that the Ukrainian military relied heavily on relatively small and inexpensive high-tech weapons and legacy weapons such as conventional tube artillery, rocket launchers, and tanks. The impact of the portable anti-tank and anti-aircraft missiles has been particularly striking. The Javelin, a mobile anti-tank guided missile, has a range of 2,000 meters and, in top attack mode, penetrates the thinly armored top of the turret at a steep angle over the tank's head.[12] The armor on the upper part of the turret, in other words the ceiling of the fighting compartment where the crew acts, is not very thick because technology to attack tanks from overhead has never been put to practical use. However, an increasing number of recent anti-tank missiles, like the Javelin, have top attack capability. Furthermore, in Soviet and Russian tanks, the area under the floor of the fighting compartment is used as an ammunition storage compartment, and there are no bulkheads to protect the fighting compartment. Therefore, when they are hit by a top attack, the shells stored beneath tend to ignite, causing a large explosion. This is why scenes of Russian tank turrets flying up in the air like a jack-in-the-box are frequently reported.

The role of legacy weapons like conventional artillery has also been significant. In addition to pinpointing and destroying targets with precision-guided weapons, ground combat often requires, for example, barraging enemy infantry positions to prevent them from moving or acting. This is when the number of punches, like jabs in boxing, becomes important. When the author attended the Halifax International Security Forum in Canada last November, one of the most frequently heard phrases was “155-millimeter shells.” The Ukrainian military has worked in recent years to strengthen its artillery firepower with howitzers, other barrel artillery and multiple rocket launchers. This is based on the experience that since the annexation of Crimea in 2014, 90% of casualties in engagements with Russian forces have been caused by artillery. As a result, a comparison of Russian and Ukrainian troop strength at the beginning of the war shows that while Russia had an overwhelming advantage in total troop strength (900,000 to 210,000 troops) the difference in artillery was not at a decisive point (2,433 guns to 1,176 guns and 3,547 multiple rocket launchers to 1,680).[13] Furthermore, the combat efficiency of Ukrainian artillery is said to be higher than that of Russian artillery.[14] This is due to the fact that while the Ukrainian military uses the same artillery as the Russian military, it also makes extensive use of drones to search for targets and observe fire, and utilizes digital command and control systems to efficiently operate its artillery units.

Lessons about the importance of stockpiling ammunition

The important role of artillery means a great deal of ammunition consumption, and there are questions about whether ammunition production capacity can supply the required amount. The U.S. and other NATO countries have provided Ukraine with more than 150 155-mm howitzers since the war began last year.[15] On average, the Ukrainian military consumes 3,000 rounds of 155-mm ammunition per day, or 90,000 rounds a month.[16] In contrast, the U.S. in its entirety produces 14,000 rounds of this ammunition per month, meaning it takes six months to produce the monthly consumption of the Ukrainian military. With this unexpectedly high consumption of artillery shells and missiles, the U.S. Department of Defense has begun to strengthen its ammunition production base to about three times its current level, but this will take time. In the case of 155-mm shells, it appears the U.S. will reach its target of producing 20,000 shells per month by spring 2023 and 40,000 per month by 2025.[17]

This is an instructive lesson for the defense of Japan. To begin with, ammunition is less flashy than the weapons themselves, and the effects of the investment are difficult to see. Moreover, while a budget request for a naval vessel or fighter plane cannot be reduced by half, ammunition, like a liquid, can be cut by any percentage. Furthermore, procuring ammunition requires ammunition storage facilities. The fact that it is not easy to secure land to build ammunition depots in densely populated Japan has been one of the factors reducing the willingness to allocate spending for ammunition procurement. With the defense budget expected to increase, it is urgent that resources are invested in ammunition stockpiling, which has been neglected.

Conclusion

As stated at the beginning of this article, there are no signs that Ukraine will lose. As long as Western support continues, Russia does not seem to have a means to win. However, it is hard to imagine Russia losing. This can be explained for purely tactical reasons: The farther the Ukrainian counteroffensive goes, the longer the supply lines will become, and the more threatening the enemy will be. As the author noted in a previous article,[18] it is strategically inadvisable to put Russia in such a position given the fear of an escalation to the use of nuclear weapons. Unfortunately, there is no hope that this war will end in the short term because neither side can easily compromise on the current situation. It will take a long time to reduce the level of engagement and bring the situation to a point where it could be considered a standoff. In other words, it will take years just to bring the current state closer to a situation similar to the 38th parallel on the Korean Peninsula.

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Image by Gernán & Co

The earliest recorded kiss goes back at least 4,500 years to Mesopotamia

Researchers cite clay tablets and other materials that push back evidence of kissing by about 1,000 years

THE NEW YORKER By Mark Johnson, May 18, 2023 

Couples kiss after midnight during the 2013 New Year's Eve celebration in New York City's Times Square. (Christopher Gregory/Getty Images)

When was the first kiss? Recent papers have suggested that romantic or sexual kissing began 3,500 years ago in what is now India. But a new review paper in the journal Science says that this style of kissing is also mentioned in clay tablets from Mesopotamia that predate the Indian texts by about a thousand years.

Danish husband and wife researchers Troels Pank Arboll and Sophie Lund Rasmussen stress that “the behavior did not emerge abruptly or in a specific society, but appears to have been practiced in multiple ancient cultures,” including Egypt.

Arboll and Rasmussen note that “the act of kissing may have played a secondary and unintentional role throughout history” by enabling disease-causing microorganisms to spread from one mouth to another. But the kiss, they write, “cannot be regarded as a sudden biological trigger” that led to societies being deluged by pathogens.

The two researchers launched on their search for the earliest kiss last summer while discussing a paper on the ancient DNA of the herpes simplex virus 1 at the dinner table. The herpes paper had noted a shift in the transmission of the virus during the Bronze Age (2,000 to 700 B.C.), “potentially linked” to new cultural practices “such as the advent of sexual-romantic kissing.”

New? Bronze Age? Really?

“I said to Sophie that I knew we had something older. And then I started digging a bit into that,” said Arboll, an assistant professor of Assyriology at the University of Copenhagen who studies ancient accounts of medical diagnoses, prescriptions and healing rituals.

“We’re a very nerdy couple,” explained Rasmussen, an ecologist at the University of Oxford’s Wildlife Conservation Research Unit (WildCRU) and Aalborg University in Denmark.

Arboll had little trouble finding accounts of kissing from Mesopotamia written in both the Sumerian and Akkadian languages. He and Rasmussen noted too a calcite sculpture in the British Museum called the “Ain Sakhri Lovers,” which was found in caves near Bethlehem and is estimated to be about 11,000 years old.

“It had been known for decades in my field,” Arboll said of the written accounts of kissing from Mesopotamia.

“The thing about Assyriologists,” Rasmussen said, “is they like to argue with each other, but they don’t really talk to other people.”

That could explain why some experts adopted India as the place of origin for kissing, though Arboll has a different theory:

"I think one of the sources they cite are manuals like the Kama Sutra,” he said, referring to texts estimated to have been published between 2,400 and 1,700 years ago. “That’s obviously very appealing for discussing sexual behavior, I imagine.”

In her 2011 book “The Science of Kissing: What Our Lips Are Telling Us,” Sheril Kirshenbaum reported the earliest literary evidence for human kissing “dated back to India’s Vedic Sanskrit texts around 1500 B.C.” But she’s convinced the behavior goes back much further in history.

“We see so many similar behaviors across the animal kingdom — including in our closest relatives, like bonobos,” she said. “I suspect our species has been kissing for as long as we’ve been on Earth.”

There may have been practical reasons for humans to kiss, Rasmussen said. “I came across research suggesting that the purpose of kissing, why it could have evolved, is that it serves as an opportunity to evaluate your partner,” she said. “If you kiss somebody with poor teeth, they tend to have bad breath.”

Kissing may have allowed couples to bond and strengthen their relationship. “And of course also for sexual arousal,” said Rasmussen. “So when you want to mate and pass on your genes, it’s very convenient.”

Enjoying a romantic kiss outside the confines of marriage appears to have been frowned upon by the Mesopotamians. Arboll and Rasmussen came across the story of a married woman “almost led astray by a kiss from another man.” Worse, kissing someone who was not supposed to be sexually active, such as a priestess, they write, “was said to deprive the kisser of the ability to speak.”

Such prohibitions may have had the unintended benefit of protecting the good health of the kiss-deprived. The Danish researchers point out kissing’s likely role in spreading herpes simplex virus 1, Epstein-Barr virus and human parvovirus B19, which causes a rash. Such pathogens, the authors wrote, “can infect humans through a range of different transmission routes, including saliva, making any act of kissing a potential means of spreading infection.”

To date, though, science has had relatively little to say about kissing, according to Kirshenbaum, an academic specialist at Michigan State University.

A scientific literature search for “kiss” or “kissing” sends you through funky territory before you ever encounter two sets of lips. PubMed’s search engine begins with the KISS1 gene and its product kisspeptin, and proceeds to a cellular process called kiss-and-run. Google assumes that in seeking the “earliest known kiss,” you hope to find the earliest publicity photo of the rock band Kiss, or the earliest known Kiss tribute band.

“Here’s something that touches all of us,” Kirshenbaum said, “yet science has barely scratched the surface of it.”

An 11,000-year-old carving known as the “Ain Sakhri Lovers,” found in a cave system near Bethlehem, may be one of the earliest depictions of humans kissing. (British Museum)

The human fascination with kissing history comes as no surprise to Laura Weyrich, an associate professor of anthropology at Pennsylvania State University who co-authored one of the studies cited by the Danish researchers. Her paper, published in Nature in 2017, examined DNA from the dental plaque of Neanderthals and used it to infer information on their behavior, diet and disease.

Weyrich’s study noted that humans and Neanderthals may have traded microbes, which could have happened through the sharing of food or water sources — or through kissing.

In some interviews about the Neanderthal paper, Weyrich dispensed with the term “kissing” in favor of the more earthy alternative, swapping spit, and “biologically, it really is swapping spit,” she said.

Never let it be said that scientists lack romance.

There is some debate among researchers about whether kissing began in one place and spread or had “numerous independent origins,” as Arboll and Rasmussen write.

“My hunch is that kissing arose or was discovered amongst elite in complex societies (hierarchal, market systems with writing) and diffused outward,” William Jankowiak, a professor of anthropology at the University of Nevada at Las Vegas, wrote in an email.

The practice of kissing, he said, was in keeping with “the elite pursuit of pleasure.”

Image: Germán & Co

Cooperate with objective and ethical thinking…

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News round-up, May 19, 2023

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Most read…

As Oil Giants Retreat Globally, Smaller Players Rush In

BP, TotalEnergies, Chevron and others are shifting to cleaner projects

WSJ By Nicholas Bariyo in Kampala, Uganda, Juan Forero, in Bogotá, Colombia, and Jon Emont in Singapore, May 18, 2023 

“Debt-Limit Terror” Is No Way to Run a Superpower

On the latest round of the Republicans’ dangerous game.

The New Yorker By Susan B. Glasser, May 18, 2023

Yevgeny's Prigozhin's Meat Grinder

A Moment of Truth for Russia's Wagner Group in Bakhmut

The Russian mercenary force Wagner Group has propped up autocrats from Mali to Syria in recent years. In Bakhmut, however, it now finds itself in the bloody spotlight of the war in Ukraine. Leader Yevgeny Prigozhin has long enjoyed Putin's support – but for how much longer?

By Christian Esch, Christina Hebel, Alexander Chernyshev, Fedir Petrov, Alexander Sarovic, Christoph Reuter, Fritz Schaap and Andrey Kaganskikh, 

G7 urged to phase out fossil fuels by Netherlands, Chile, others

The leaders of seven nations, including the Netherlands and Chile, have stated that the Group of Seven rich countries must take the initiative in gradually phasing out fossil fuels to create momentum for a worldwide agreement this year.

REUTERS By Kate Abnett, EDITING BY Germán & Co

Friday Briefing…

—The U.S. debt limit nears/Balancing the U.S. budget for Ukraine aid

—The end of al-Assad’s isolation?

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The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

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Today's events

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Today's events 〰️

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The Agbami deep-water oil field in Nigeria. GEORGE OSODI/BLOOMBERG NEWS/Editing by Germán & Co

As Oil Giants Retreat Globally, Smaller Players Rush In

BP, TotalEnergies, Chevron and others are shifting to cleaner projects

WSJ By Nicholas Bariyo in Kampala, Uganda, Juan Forero, in Bogotá, Colombia, and Jon Emont in Singapore, May 18, 2023 

Under pressure from shareholders and activists, major energy companies are retreating from higher-polluting and riskier projects around the world. A bunch of smaller companies are rushing in to fill the void.

In Nigeria, smaller companies now hold nearly half of the country’s oil and gas oil leases acquired from major companies that have retreated in recent years. In Latin America, an independent firm has pushed into oil exploration in areas eschewed by Occidental Petroleum and BP. In Asia, Chevron is pulling out of a controversial gas project in Myanmar, and a little-known Canadian firm has agreed to snap up its stake.

The moves illustrate how smaller and more nimble firms are taking advantage of higher energy prices and the openings left by global companies that are now pivoting toward cleaner energy, or focusing on their most profitable projects. The trend also shows that despite major oil companies’ efforts to reduce their carbon footprints, their exodus from fossil-fuel projects has little effect on emissions overall.

In Nigeria, gas flaring—an emissions-heavy process that burns the natural gas associated with oil extraction—has increased by 10% over the past decade. PHOTO: GEORGE OSODI/BLOOMBERG NEWS

“What we are seeing is that the larger companies are reducing their share in aging assets with little upside production that have relatively large emissions,” said Audun Martinsen, head of energy-service research at Rystad Energy, an energy-sector research firm. “Their space has been filled by smaller exploration and production companies.”

Such companies usually have lower costs and are better placed to run such operations, he said, since they can quickly recoup returns on investments before a downturn cycle. Watchdog groups and human-rights advocates warn that smaller or private companies can at times pose a greater risk to climate and human rights in some corners of the world, because they aren’t subject to the same public scrutiny and pressure as more globally known, publicly traded players.

Overall, the portion of offshore investments held by major companies is slated to shrink from 45% in 2019 to 37% by 2025, according to Rystad. Investments in brand-new fossil oil projects around the world—many of them by smaller, lesser-known or private oil-and-gas companies—are projected to break the $100 billion mark this year, the first breach for two years in a row since 2012, according to Rystad.

In Africa, the stakes held by major oil companies in fossil-fuel projects are set to shrink to 50% in 2025, from 65% in 2019, according to Rystad data. Meanwhile, the value of new oil deals in Africa reached some $21 billion last year, more than four times the $5.5 billion worth of deals registered in 2020.

Most of the world’s biggest energy companies have invested heavily in low-carbon strategies in recent years, while dialing back on fossil-fuel exploration and production except in their most profitable regions. Chevron, Shell and Exxon, for example, have left Nigeria, Ghana and elsewhere amid promises to reduce emissions as well as mounting security challenges related to oil thefts and lawsuits over pollution.

Independent and smaller companies now account for 32% of total oil and gas output in Africa, compared with an average of 25% over the past decade, according to the South Africa-based African Energy Chamber, an industry group, as firms including Nigeria-based Seplat Energy and Canada’s ReconAfrica have moved in, buying up oil and gas assets or undertaking exploration.

In Latin America, major companies are developing a handful of big oil and gas fields. But increasingly, it is smaller, little-known firms that are getting the fossil fuels out of the ground. Independent companies such as Gran Tierra in Colombia, CGX Energy in Guyana, and Vista in Argentina are moving in, taking risks and investing, sometimes in regions that have hardly been explored.

In recent years, GeoPark, a Bogotá-based independent company that is listed on the New York Stock Exchange, has centered its operations on Colombia. Larger companies such as BP had left, while Houston-based Occidental Petroleum sold most local assets after making a large U.S. acquisition.

In a series of wells drilled in 2016 and 2017, GeoPark found a 400-million-barrel field in Colombia’s central plains—the so-called llanos.

“There’s a giant oil field in the middle of the llanos basin that everybody missed. We hit it,” CEO Andrés Ocampo said. “Not only did they miss it. But they were not even looking for it.”

Toronto-listed New Stratus Energy has left Ecuador but is now eyeing entry into Mexico, Peru and Colombia. It is among several small companies in Latin America with executives and geologists who worked for years at Venezuela’s state-owned Petróleos de Venezuela, known as PDVSA, but left once the industry in that country collapsed.

Workers with PTT Exploration & Production at a petroleum field in Thailand. PHOTO: DARIO PIGNATELLI/BLOOMBERG NEWS

“There’s a lot of opportunity for companies like us that are well-capitalized and have experienced management teams to go into places, and be nimble, where larger companies can’t,” said Wade Felesky, New Stratus Energy’s president.

Some smaller firms also have a high tolerance for controversial projects. Off Guyana’s coast in June 2000, Surinamese navy gunboats expelled Canada’s CGX Energy from a drilling project in waters that Suriname then claimed as its own. But the company stayed committed to Guyana. It discovered oil there last year.

A CGX spokesman said the company’s operations in Guyana include a joint venture with Canada’s Frontera Energy to drill offshore in the country’s eastern Corentyne region. The companies are completing a second exploration well there, the spokesman said, adding that CGX is also developing a deep-water port in the country.

Last year, France’s TotalEnergies stopped operating a major Myanmar gas field, saying revenue payments to the state became controversial after a military coup in Myanmar in 2021. Operations were taken over by Thailand’s PTT Exploration & Production, which cited the gas fields’ importance to Myanmar and Thai energy consumers.

Chevron, the other major Western player in the project, last year agreed to sell its stake in the project to Et Martem Holdings, the wholly owned subsidiary of MTI Energy, a Canadian company.

Advocacy group Justice for Myanmar condemned the sale, saying the project supports that country’s military dictatorship, which has been accused of killing protesters and other crimes. MTI Energy didn’t respond to requests for comment.

Environmental advocates warn that smaller and more opaque companies can cause the same environmental damage that major companies, such as Shell, have been accused of in recent years.

Canada’s ReconAfrica exploring for oil in northern Namibia. PHOTO: NICOLE MACHEROUX-DENAULT/DPA/ZUMA PRESS

In Nigeria, gas flaring—an emissions-heavy process that burns the natural gas associated with oil extraction—has increased by 10% over the past decade. Meanwhile, smaller companies, including Aiteo Eastern E&P, have been increasing their share of operations in the country, according to data from Capterio, a U.K.-based firm that tracks gas flaring and local environmental groups. Aiteo didn’t respond to multiple calls and written requests for comment.

In Angola, the disposal of solid and liquid waste on the coast has gone up since Somoil, Angola’s large, private energy company, took over licenses of TotalEnergies last year, according to EcoJango, an environmental consulting firm based in Angola. An average of 10,000 tons of waste are dumped along Angola’s beaches every day, versus around 6,000 tons three years ago, according to the state-run National Institute of Biodiversity and Conservation. Somoil didn’t respond to multiple questions about its environmental record.

In Africa’s Okavango Delta, a U.N.-recognized World Heritage site of channels and lagoons, local groups accuse Canada’s ReconAfrica of polluting domestic water sources and intimidating local residents opposed to its continuing search for oil.

A spokesman for ReconAfrica denied the accusations and said the company is applying rigorous safety and environmental protection standards in its operations. He added that ReconAfrica is committed to “responsible and ethical resource development.”

Anusha Narayanan, climate campaign director at Greenpeace USA, said new fossil-fuel projects will hamper the transition to cleaner energy.

“Some contracts signed over the last year by producers and importers are locking them into decades of pollution,” she said.

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Joe Biden arrives at the Marine Corps Air Station in Iwakuni, Japan, ahead of the G-7 summit in Hiroshima.Photograph by Susan Walsh / AP/EDITING BY Germán & Co

“Debt-Limit Terror” Is No Way to Run a Superpower

On the latest round of the Republicans’ dangerous game.

The New Yorker By Susan B. Glasser, May 18, 2023

What can you say about a week in American politics when the major breakthrough was that the two parties agreed to stop talking about talking, in order to actually start talking? In Washington, where, for months, President Biden and congressional Republicans have been hurtling toward a confrontation over the G.O.P.’s refusal to raise the debt ceiling without major concessions from Democrats on federal spending, the beginning of formal negotiations aimed at averting a disastrous government default counted as big news. For the rest of the world, it was merely a sign of the capital’s extreme dysfunction, and a reminder that America’s messed-up politics constitutes a geopolitical crisis as well as a domestic one.

On Tuesday, Biden reinforced the point by announcing that he would cut short an important overseas trip to the Pacific region in order to return to Washington for the debt talks. With default looming—coming, perhaps, as soon as early June, according to the Treasury Department—this seemed like a politically advisable course, but the optics were nonetheless terrible. The President will still attend the G-7 meeting in Hiroshima, Japan, but skip his planned stops in Australia and Papua New Guinea. Both visits had been designed to showcase the U.S.’s top foreign-policy priority—shoring up American alliances in the region as part of the growing confrontation with China.

The change in Biden’s plans did not go over well. Papua New Guinea had scheduled a national holiday for this coming Monday to celebrate the first time a sitting American President would visit the suddenly strategic island nation. Oops. Party cancelled. In Australia, Biden’s decision was seen as a significant political embarrassment for the Prime Minister, Anthony Albanese—“a disappointment, a mess, and a gift to Beijing,” as a headline in the Sydney Morning Herald put it. Albanese, who had announced, a mere nine hours before the White House pulled out, that Biden would address a special joint session of the Australian Parliament, ended up scrapping a planned summit of leaders from Australia, India, Japan, and the U.S., a coalition of countries known as the Quad. He complained about “the blocking and the disruption that’s occurring in domestic politics in the U.S., with the debt-ceiling issue.” Back in Washington, even the President’s supporters were embarrassed. Although Biden had to put himself “in the center of action,” Representative Jake Auchincloss, a Democratic up-and-comer from Massachusetts, said, “it’s painful to see a public-relations gift for the Chinese Communist Party.”

Sending a message to the rest of the world about American leadership has clearly not been the foremost concern of Republicans on Capitol Hill. Never mind that some of these same Republicans are the loudest voices demanding more and tougher confrontation with China. For months, the brewing debt-ceiling fight has been the capital’s equivalent of background noise, some weeks louder, some weeks quieter, but always there, waiting for the inevitable moment when the U.S. would come close to default and the real politics would begin. It was merely a coincidence, albeit a highly symbolic one, that Biden was at the G-7 summit, in Japan, the same week that he finally gave in to Republican demands to negotiate spending cuts as a price for a debt-ceiling increase and named a team—the White House aide Steve Ricchetti and the Office of Management and Budget director Shalanda Young—to do it. The official spin from Democrats is that the White House has not actually capitulated, since the talks are about the budget, not the debt limit itself. “We have not budged from our position that default should not be used as hostage-taking,” the Senate Majority Leader, Chuck Schumer, said. Except, of course, that is exactly what is happening.

One of the problems is that we’ve been here before, in 2011 and 2013, when, just like today, a Democrat was in the White House and Republicans controlled the House. The script is all too familiar: there were dire warnings, talks about talking, and then frantic last-minute negotiations. Each time, a default was averted, but only barely. (In 2011, a deal was reached two days before the predicted date of default, after financial markets went crazy and Standard & Poor’s downgraded the U.S. credit rating for the first time in history.) Few observers believe a default will happen this time, either. Which makes the present crisis a very artificial one indeed, manufactured by Republicans who now see a ritual act of economic self-sabotage as a surefire way to extract concessions that they could not otherwise secure.

This, alas, was always the G.O.P.’s plan if it managed to win back the House in this past fall’s midterms—as early as last October, weeks before the election, leaders of the extreme Freedom Caucus faction said openly that they were looking forward to using the debt ceiling as “leverage.” “Debt-limit terror,” as the former Treasury Secretary Larry Summers called it in an interview with Politico last year, was both foreseeable and foreseen. But, like the return of Donald Trump as the 2024 Republican front-runner, the fact that a political crisis was entirely predictable has not in any way prevented it from happening.

Democrats “made a horrible mistake” by agreeing to negotiations in 2011, the Democratic senator Chris Murphy, of Connecticut, told Punchbowl News this week, arguing that, this time, the Democrats should call the G.O.P.’s bluff and run out the clock. That way, Republicans would either have to cave and agree to raise the debt ceiling without attaching extraneous provisions, or they would take the country into default and own the political consequences. Other Democrats, concerned that the White House will eventually agree to Republican demands—which include strict budget caps, work requirements on federal assistance to the poor, and the rollback of key provisions in Biden’s signature legislation, the Inflation Reduction Act—are publicly pushing the untested legal theory that the Fourteenth Amendment allows Biden to bypass Congress and act unilaterally to secure the public debt. “Get rid of the debt-limit hand grenade forever,” Senator Sheldon Whitehouse, a Rhode Island Democrat, urged the President in a video he posted on Twitter. “This blackmailing has to end,” Senator Jeff Merkley, of Oregon, another supporter of invoking the Fourteenth Amendment, said.

But that is not the path that Biden has chosen, nor, despite his recent bluster that he was thinking of going that route, did it ever seem like a serious possibility. Talks were inevitable, and the suspense now mostly lies in the details of whatever deal is reached. Part of the Democratic skepticism is the almost palpable fear that the White House will concede too much. A deal is still not a foregone conclusion. Uncertainty remains. It could all blow up. And so success is measured, once again, in the usual small Washington increments, in which a decision to allow the talking to begin counts as progress. Smelling victory, House Speaker Kevin McCarthy does not even seem to mind being called a terrorist. “I see the path,” McCarthy told reporters on Thursday. Of course he did.

The unravelling of a superpower’s credibility does not happen in an instant but over time and as a result of repeated crises. That the crises plaguing Washington are often self-inflicted has not made them any less damaging. Biden is right to fly back to his embattled capital. The greatest threat to the international order is right here. 

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Foto: [M]: Mikhail Metzel / SNA / IMAGO; AP / dpa; RIA Novosti / SNA / IMAGO; REUTERS; Valentin Sprinchak / ITAR-TASS / IMAGO/Editing by Germán & Co

Yevgeny's Prigozhin's Meat Grinder

A Moment of Truth for Russia's Wagner Group in Bakhmut

The Russian mercenary force Wagner Group has propped up autocrats from Mali to Syria in recent years. In Bakhmut, however, it now finds itself in the bloody spotlight of the war in Ukraine. Leader Yevgeny Prigozhin has long enjoyed Putin's support – but for how much longer?

By Christian Esch, Christina Hebel, Alexander Chernyshev, Fedir Petrov, Alexander Sarovic, Christoph Reuter, Fritz Schaap and Andrey Kaganskikh, 

The clip that Yevgeny Prigozhin recently posted to his Telegram channel could easily have been mistaken for a poorly made horror film. It shows a field at night, bloodied dead bodies lying in the light of Prigozhin’s flashlight. Also in the video is Prigozhin himself, a brawny, bald man wearing a pistol in a holster. "These are boys from Wagner who died today. Their blood is still fresh!" he growls. The camera pans further, and only now can viewers see that there are four grisly rows of bodies. Dozens of corpses in uniform, many of them with no boots.

Then Prigozhin steps directly in front of the camera and explodes. His face contorted in anger, he hurls insults at Russian military leaders who, he says, are failing to provide him with the munitions he needs. "You will eat their entrails in hell," he yells. "Shoigu, Gerasimov, where is the fucking ammunition?" It is an outburst of rage against Defense Minister Sergei Shoigu and Chief of the General Staff Valery Gerasimov, but staged for better effect and loaded with profanity and contempt. Prigozhin sounds like a bandit challenging his rivals on the outskirts of town at night. Like he would like to turn both Shoigu and Gerasimov into corpses that he could then lay next to his boys.

Russia last week celebrated its World War II victory over Nazi Germany with the usual military parade on Red Square, a speech by the president and marching music. But whatever uplifting images the Kremlin wanted to create in Moscow, they were overwhelmed by Prigozhin’s nighttime parade of corpses and his abuse, recorded in a field somewhere near Bakhmut in the Donbas, where he had sent the Wagner Group fighters to their deaths.

Prigozhin, a businessman from St. Petersburg, has good contacts within Putin’s closest circle and is the leader of a notorious mercenary unit that is active from Syria to Mali. Prior to Putin’s invasion of Ukraine, he was very rarely in the public eye. Now, though, the war has given him a new role and a new stage.

His is the story of one man's rise to unimaginable power. Within Putin’s dictatorship, it appears that Prigozhin can do whatever he likes. He can promise people their freedom or send them to their deaths, he can humiliate powerful men and openly threaten his enemies. And his story is also that of an outfit that fights without mercy – and, in this war’s longest battle in Bakhmut, is sacrificed without mercy.

Prigozhin poses as Putin’s loyal bloodhound, but also threatens the very system the president has built up. He has turned the sledgehammer into a symbol of his politics, to the horror of the Russian elite and the pleasure of some Russians. He takes care of the dirty work for Putin – but he has decided to highlight that filth instead of doing his work in the shadows. He has given a face to the brutalization of the Putin regime. Many, though, have been left to wonder: Is this man powerful? Is he a megalomaniac? Desperate? All of the above?

A photo of a Wagner mercenary fighting in house-to-house combat in Bakhmut, published in a state-run Russian media outlet. Foto: Evgeny Biyatov / Sputnik / IMAGO/EDITING BY GERMÁN & CO

Hardly a day has passed in recent months without Prigozhin posting audio files, videos or photos to his Telegram channel. He has had himself filmed in an embattled salt mine and in the cockpit of a Su-24 bomber. He presented mandarin oranges to Ukrainian prisoners of war at New Year’s, only to then threaten that he would be taking no more prisoners. He has offered his services as a mediator in Sudan, insulted the family of the Russian defense minister, complained about competition from Gazprom mercenaries and said he should be given 200,000 troops so he could take care of Ukraine once and for all. He has talked and talked and talked.

One week before his video of the dead bodies in the field, Prigozhin sat down for the most in-depth interview he has given in quite some time. In it, he presented a different version of himself: that of a jovial, even cheerful older man in reading glasses who is fond of talking about his own merits. Wearing an olive-green, Beretta-brand fleece, he was sitting in a windowless room, apparently his headquarters in the Donbas.

"In this room," Prigozhin claimed in the interview, he and his people developed the battleplan for Bakhmut, the "Bakhmut Meat Grinder." The idea, he said, was to wear down a large part of the Ukrainian army during the fighting. Then, Prigozhin continued, they had invited Army General Sergei Surovikin – who was commander of the invasion force at the time – to join them. "Surovikin sat down, listened to our plan, and went 'Holy Shit!' and said, 'Boys, fuck it all, I graduated from the Military Academy for no reason at all!'"

It was the kind of story one frequently hears from Prigozhin – and it is totally unclear where fact and fiction intersect. It was meant to show that the businessman, who never advanced beyond the rank of private, is on a level with Russia’s senior-most generals. That the battle plan came directly from him. And that the months of slamming into enemy positions, far from being a mistake, was actually part of a clever plan.

It's just that the meat grinder is no longer working, because his troops are also being butchered – and because he is no longer receiving the munitions he needs. It is a complaint that Prigozhin has been making for quite some time.

Bakhmut: A Mission of Choice

The fact is, Prigozhin has made the conquering of Bakhmut his personal mission. It was apparently his idea to attack the city before Ukrainian supply lines were cut, thus turning it into a battle of attrition – from the standpoint of both personnel and materiel. For weeks, this small town in the Donbas has been on the verge of being completely overrun. In recent days, however, the Ukrainians have begun to claw back territory from the Russians.

The most surprising thing is not, however, that a businessman and head of a private mercenary army (which shouldn’t exist according to Russian law) claims to have developed this suicidal battle plan together with army commanders. It’s the fact that this man was also allowed to recruit his fighters from the prisons of Russia.

One of his fighters was Rustam, 42, a man with a gray, haggard face and a weak, high-pitched voice. He spent a few days in the meat grinder of Bakhmut as a disposable soldier, a tiny figure on Prigozhin’s vast chessboard. Currently, he is waiting in a prison in the Ukrainian city of Dnipro, waiting to be included in a prisoner exchange. It is there that he told DER SPIEGEL his story.

Rustam, whose name has been changed for this story, wears two bracelets on his left wrist. The red one stands for HIV and the white for hepatitis – symbols used in the Wagner Group to identify the infections that the prisoners in its ranks suffer from. Rustam is now in the advanced stages of AIDS, and he estimates that he has just three or four years left to live. His prison sentence was far longer than that: 11.5 years for the possession and consumption of methadone. When Wagner representatives showed up in his camp in the Ural region, he still had a decade left to serve, and his calculation was a simple one: Serve six months in Ukraine and be released; or die behind bars.

Of the 30 men who reported for duty from Rustam’s colony, he was apparently one of the most able-bodied. Only nine of them managed to complete the required fitness test, the sit-ups and the pull-ups. He says they were told they wouldn’t be used as fighters anyway and would instead be responsible for pulling the injured and dead from the battlefield.

“They would advance directly into our fire. Once the first wave was dead, the next one appeared. And the next."

Ukrainian soldier from the 113th Brigade in Bakhmut about the Wagner fighters.

Rustam received three weeks of training from the Wagner Group in a camp in Ukraine, apparently close to the front. Rustam says that he could sometimes hear artillery fire. "You can ignore the rules you learned in prison," they were told. "We are now all one family."

He went into battle for his first and last time on the night of February 9. Suddenly, there was no longer any mention of just recovering the wounded. Instead, they were ordered to take a bit of high ground near Bakhmut, and they immediately came under fire from grenade launchers and snipers. Rustam crawled back and forth, playing dead when drones flew overhead. He was a living bull’s-eye in the snow, which he ate to still his thirst. On the second day, he was shot in the arm and lost consciousness. When he woke up, he was a war prisoner.

Rustam now says he never again wants to go into battle. Though that is a pledge he also made to himself two decades ago, back when he returned from the Chechen war.

There are up to 10,000 Wagner fighters currently in Ukraine, according to a senior official in the Ukrainian military intelligence agency HUR, and most of them have been deployed in and around Bakhmut. The meat grinder has been in operation for months now. Housing block by housing block, destroyed home by destroyed home, the Ukrainians have pulled back.

They observed Prigozhin’s battle tactics with horror. "They were like the White Walkers from 'Game of Thrones,'" says a Ukrainian soldier from the 113th Brigade in Bakhmut – referring to the creatures on the HBO series who rode out of the ice and into battle on undead horses, immune to fear and pain. "They would advance directly into our fire. Once the first wave was dead, the next one appeared. And the next. It sometimes went on like that for half a day or an entire night." The Russians continued launching such attacks, the Ukrainian soldier says, for two months, until the Wagner prisoners were replaced by soldiers from the regular Russian army.

A Ukrainian junior officer shows a video taken by an infrared camera of men armed with assault rifles who, rather than running, apparently walked into battle unconcerned about cover. They simply strode onward, straight ahead.

The HUR official estimates that up to 70 percent of the attackers died in such assaults.

But in the battle for Bakhmut, it’s not just the many thousand Russian prisoners who have been crippled and killed. It is quite possible that the entire Wagner Group in its present form is currently experiencing its demise on the Ukrainian battlefield. Because Prigozhin’s attempt to blackmail the military leadership has failed. He vocally threatened to withdraw his troops from Bakhmut due to a lack of munitions. The supplies never showed up, but Prigozhin remained. He apparently overplayed his hand.

Prigozhin and Kadyrov: Putin’s Enforcers

That does not change the fact, however, that this man has permanently altered Putin’s regime, just as the Chechen strongman Ramzan Kadyrov before him.

Indeed, Prigozhin is frequently compared to Kadyrov: Both men have made blatant brutality a trademark. Both take care of Putin’s dirty work. Both are outsiders among the Russian elite. Both have contributed a fighting force to the attack on Ukraine – and have formed situational alliances.

But Kadyrov has an official post and a clearly defined region under his control. Prigozhin is formally a businessman, nothing more. On the other hand, though, he has a nose for politics. In a system where open debate and political wrangling no longer exist, he has brought them back with his vulgar slogans and macabre videos. He has linked the issue of munitions with attacks on the bureaucracy, on the elites in their villas (as though he weren’t one of them) and on an alleged "deep state" of pro-Western liberals in Moscow. It is a message that many in Russia are eager to hear.

Russian President Vladimir Putin together with Chechen leader Ramzan Kadyrov

Foto: Sven Simon / ullstein bild

Nothing illustrates that development more clearly than the sledgehammer story. In November 2022, Wagner mercenaries murdered a deserter in horrific fashion. As a prisoner of war in Ukraine, Yevgeniy Nushin had claimed to be a defector. He was handed back to his old unit after a prisoner exchange. To make an example of him, they bashed in his head in front of the camera. Prigozhin praised the clip for its "fantastic directing." The instrument of violence was not chosen at random: Back in 2017, Wagner mercenaries also used a sledgehammer to murder a Syrian, filming that scene as well.

Two months after the public murder of Nushin, Sergei Mironov, a prominent member of the Duma, Russia’s parliament, posed for photographs with an autographed sledgehammer presented to him by Prigozhin. "For S.M. Mironov from the PMC Wagner. Bakhmut – Soledar," read the inscription on the shaft, along with a smiley. "A useful instrument," joked Mironov.

Mironov is a typical product of the Putin system, a man who goes with the political winds. The parliamentary party he leads, A Just Russia – For Truth, has made sharp changes of course. It says a lot about the mood in the country when such a figure poses with a Wagner sledgehammer and there is hardly a peep from the public at large.

Some have begun comparing Prigozhin’s role with that of the Oprichniki, the bloodthirsty special core deployed by Ivan the Terrible to keep his elite in line. Their emblem was a dog’s head and a broom, which they used to cleanse the empire of traitors. Prigozhin has replaced the broom with a sledgehammer.

For now, Moscow’s elite is more fascinated by Prigozhin than afraid of him. "It's not like he walks the streets with a sledgehammer," says a former senior Kremlin official. "Prigozhin’s success has gone to his head, which is dangerous for him personally. He is still needed today, but tomorrow, they’ll tear his head off."

"We all lived through the 1990s, a time when there were also a number of nasty bandits," says one businessman. "If people are afraid, they are less fearful of Prigozhin than they are of the secret service and of Putin."

"Prigozhin has the role of a dog who barks at everybody and keeps the elite on their toes," says secret service expert Irina Borogan. "It’s clear that Putin quite likes it." She believes that Prigozhin is seeking a seat on the Security Council, side-by-side with Putin’s intelligence service partners – if for no other reason than for protection.

“It is clear that Prigozhin is thinking to a time beyond Putin."

Political analyst Tatiana Stanovaya

After all, Prigozhin’s only powerbase thus far as been Putin’s goodwill. He hardly has any powerful allies, but no shortage of enemies. The fact that he still enjoyed Putin’s support until recently is clear: Nobody except Putin could have authorized the recruitment of mercenary fighters from the nation’s prison camps. But for how much longer will that support last? And might Putin ultimately see Prigozhin as a threat?

"I don’t think that Putin feels threatened by him. But it’s a similar situation to Kadyrov: The two present no danger to the regime only as long as Putin is still in power," says political analyst Tatiana Stanovaya. "It is clear that Prigozhin is thinking to a time beyond Putin."

But Prigozhin might already represent a danger to Putin’s system, even in his weakest moments. It is evident that the videos he produced in Bakhmut were made out of desperation, calls for help addressed to a president to whom he has no direct access. Prigozhin attacks publicly because he is unable to get what he wants behind the scenes. But that, too, is a danger to the system.

"Prigozhin isn’t dangerous to the elite because of his sledgehammer. It's because he's the only big-name politician who says openly what people otherwise only whisper about among themselves," says the Moscow-based political expert Marina Litvinovich.

Wagner: The Forging of the Sledgehammer

It’s not easy to tell the story of Prigozhin’s mercenary army in retrospect because it is set in so many different places at the same time: in eastern Ukraine, Syria, Sudan, Mali, the penal colonies of the Urals and the cafe's of St. Petersburg.

Generally speaking, it is the story of an experiment that spun out of control. It began with the idea of establishing a mercenary operation to use force abroad but from which the Kremlin could distance itself. To delegate violence to an outsourcing specialist who had, as a caterer and service provider, already taken on a handful of other tasks on behalf of the Russian army. That was the first, successful phase of the experiment. Prigozhin’s mercenaries allowed the Kremlin to operate undercover in the Donbas, put boots on the ground in Syria and build a kind of low-cost empire in Africa.

But with Putin’s 2022 invasion of Ukraine, the original idea was suddenly transformed into its opposite. That is the second phase of the experiment: The small group of professional fighters turned into an army of untrained prisoners. Casualties that the Kremlin wanted to hide suddenly became grisly videos of dead bodies on Telegram. The army’s erstwhile helper became its most vocal critic. The experiment spun out of control.

The story begins in St. Petersburg. Prigozhin’s headquarters can be found in a small, 18th century palace right on the banks of the Neva River at Lieutenant Schmidt Embankment 7. There is no company sign on the building and most city residents have no idea who has their offices here – even if the area hit the headlines not long ago. Just a couple of buildings down the road, the military blogger Maxim Fomin, aka Vladlen Tatarsky, was killed by an explosion. In a certain sense, the bomb also targeted Prigozhin: The café where Tatarsky died was once operated by Prigozhin before he gave it to the Cyber Front Z, a trolling group sponsored by the businessman and to which Tatarsky spoke that evening. Indeed, Tatarsky also received money through Prigozhin’s network.

St. Petersburg is Prigozhin’s hometown, just as it is Vladimir Putin's, even if their lives took dramatically different paths. Putin once worked for the Soviet secret service agency KGB, and the fall of the Soviet Union was traumatic for him. Prigozhin, by contrast, who is nine years younger, focused his attentions on robbing apartments and spent several years in a penal colony. For him, the Soviet collapse was a liberation. He was released from prison in 1990 and dove headfirst into the new world, initially selling hotdogs before then opening the city’s first fine dining establishment called the Old Customs House. He got to know Putin’s bodyguard Viktor Zolotov and benefited from Putin’s rise. The media began referring to him as "Putin’s chef," even though Putin rarely visited his restaurants and Prigozhin wasn't a cook.

"Shoigu’s caterer" would have been the more fitting moniker. Prigozhin’s wealth came from huge state contracts, including supplying the vast Russian army with food starting in 2012. He even built and operated entire garrisons.

In parallel, he also constructed a gigantic media empire, including his own newswire. He also produced cheap movies and had plenty of money to influence public opinion on social media.

Because Prigozhin already provided services to the army, the founding of a mercenary company was, from a business standpoint, simply an expansion of his portfolio. With the small difference that mercenary companies were, and still are, illegal in Russia. For that reason, Prigozhin consistently denied being behind the Wagner Group prior to the invasion of Ukraine, even disclaiming its very existence. That is no longer necessary: In November, he celebrated the opening of a Wagner Center in eastern St. Petersburg, a high-rise office building where he offers space to patriotic bloggers and drone builders. The façade of the building reads "PMC Wagner Center" in large letters in Russian. PMC is the abbreviation for "private military company."

"I conceived PMC Wagner. I lead PMC Wagner. I have always financed PMC Wagner," Prigozhin announced in January. It was only in 2022, he has said, that he "naturally had to find new funding sources."

Among those who were around during the early days of the Wagner Group and who are familiar with Prigozhin’s headquarters on the Neva from the inside is Marat Gabidullin, a former mercenary with a sun-tanned, thoughtful face.

"Prigozhin believes that God himself gave him the right to lead people, earn vast quantities of money and be an important person. And he is 100 percent convinced that all of his decisions are correct. He knows no limits," Gabidullin says in a video call from his apartment in the South of France. He has left Russia and written a book about the time he spent as a member of the Wagner Group.

Gabidullin's story is one of gradual disillusionment.

His nom-de-guerre was "Grandpa." He was already in his late 40s when he joined the mercenary army in 2015 – a former airborne officer with a penchant for drink and a conviction for murder. The demand for irregular troops was significant at the time: Following the Euromaidan Revolution in Kyiv, Russia had annexed the Crimea and launched a war in eastern Ukraine, but the Kremlin was interested in covering up its involvement. When possible, Russia’s leaders preferred sending in volunteers, Cossacks, mercenaries and militias.

On April 1, 2015, Gabidullin got a job with Evro Polis, a company belonging to Prigozhin. The unit’s training camp was located in Molkino, right next to a base belonging to GRU, the military intelligence service. That made it abundantly clear that Prigozhin was operating with permission from on high. Gabidullin was ultimately sent to the Donbas.

Prigozhin’s troops have been in the eastern Ukrainian industrial region since 2014, not just fighting against the Ukrainian army, but also against pro-Russian rebels when they showed signs of getting out of control. There are rumors circulating that the Wagner Group has eliminated several separatist leaders over the years. According to Gabidullin, the mercenaries surrounded and disarmed the Odessa Battalion, among others. The relationship with local militia units was tense. Initially, though, all that took place in secret.

It was Putin’s military intervention in Syria that launched the Wagner Group into the public spotlight. The fighting force was unofficially called "Wagner," after the nom de guerre of its commander Dmitry Utkin, a former Spetsnaz officer with a penchant for Nazi symbols and SS tattoos on his chest.

In contrast to the Donbas, Russia’s leadership didn’t want to cover up its involvement in Syria, but it did want to minimize official casualties. Russia sent in its air force to help the country’s dictator, Bashar Assad, cling to power, but Moscow didn’t want to get involved on the ground. Prigozhin’s mercenaries were intended to provide a bit of assistance.

It put Gabidullin and his comrades somewhere between Russia and Syria. They were fighting on the ground with Russian equipment, but they were under contract to Syrian business leaders. When they found success, such as in 2016 with the first storming of Palmyra, others would take credit. But when they died, even that could be disclaimed. In early February 2018, during an attack on a natural gas field east of the Euphrates, Gabidullin and his comrades came under fire from American troops. According to leaked Wagner Group documents, 80 Russian mercenaries died in the incident. Gabidullin believes the number was closer to 100. They were essentially victims of the distance that Moscow wanted to maintain from Wagner. The regular Russian army did nothing to try to prevent the disaster, even though they had been warned by the U.S. After all, the troops didn’t formally belong to the Russian military.

Gabidullin left the group in 2019. "When I joined Wagner, it was still a mercenary force. But then, Wagner became a slave army," he says bitterly. He estimates that it had grown by then to between 2,500 and 3,000 fighters.

The Wagner Group became so well-known due to its activities in Syria that denying its existence became increasingly untenable and absurd. When the Libyan warlord Khalifa Haftar met in February 2018 with Defense Minister Shoigu in Moscow, Prigozhin could also be seen in the background. Officially, he was just in charge of serving lunch that day.

But the press photos from Haftar’s delegation make it clear that Prigozhin was at the table for the negotiations – that "Putin’s chef" was nowhere near the kitchen. The Kremlin, after all, needed him, especially in Africa. Almost three decades after the collapse of the Soviet Union, Putin wanted to demonstrate Russia’s return to the African continent, but with cheaper means. Prigozhin helped him do so.

Africa: Where Wagner Achieved Power and Wealth

The country where Wagner’s expansion to the African continent began was Sudan, of all places. From here, they spread to more than a dozen other countries on the continent, frequently following the same script: Weakened autocrat needs help and is willing to pay with access to raw materials.

It is therefore no coincidence that on April 20, 2023, Prigozhin published an open letter to the two conflict parties in Sudan who have been openly waging war against each other for the past couple of weeks – the regular army on one side and the Rapid Support Forces on the other. In the letter, Prigozhin offered his services as a mediator. He has, he wrote, "long had ties" with the country and has "spoken with all decision-makers in the Republic of the Sudan." And that likely wasn’t an exaggeration.

Back in 2017, Sudanese dictator Omar al-Bashir presented his country to the Russians as the "key to Africa" in a meeting with Putin at the Russian president’s Black Sea residence in Sochi. The Kremlin was interested in returning to the continent following decades of inactivity there, and also wanted a naval base on the Red Sea. The internationally isolated al-Bashir, meanwhile, was looking for help free of onerous conditions.

Following al-Bashir’s meeting with Putin, the Sudanese signed a contract with M Invest, a company from Prigozhin’s empire, giving it a concession for gold prospecting. Prigozhin sent in geologists, minerologists, trainers and weapons, and launched a disinformation campaign.

The deal – gold in exchange for holding onto power – soon failed. Following a wave of protests in the country, al-Bashir was overthrown by his own military on April 11, 2019. A week prior to the putsch, Prigozhin would later say, he had personally warned al-Bashir in Khartoum of "an apocalyptic scenario" if he didn’t "take consequences." What he meant by "consequences" became clear through a leak: Prigozhin’s advisers had provided a few ideas for how the dictator could bring the protests to an end, with the suggestions ranging from denouncing the opposition as "enemies of Islam and traditional values" to public executions.

The cooperation between Prigozhin and the rulers in Khartoum survived the fall of dictator al-Bashir and a further putsch in 2021. New military deals were signed with Russia. Moscow officials have close ties to both generals in senior leadership: General Burhan and General Daglo, known as Hemeti.

The cooperation with RSF leader Hemeti was of particular interest for Prigozhin. The general controls the vast goldmines in Darfur and South Kordofan and is involved in smuggling gold abroad. Prigozhin’s company delivered weapons to Hemeti’s RSF troops and received access to the gold trade in return, with the gold being smuggled out of the country onboard Russian aircraft. The U.S. broadcaster CNN was able to identify at least 16 such flights from early 2021 to mid-2022. Wagner is also thought to be involved in uranium mining in the country.

In the most recent power struggle between Burhan and Hemeti, Moscow has officially declined to take sides. Prigozhin, for his part, has offered his services as a mediator, but has also reportedly delivered shoulder-fired surface-to-air missiles to Hemeti’s RSF troops. Whether Prigozhin’s mercenaries are also involved in the fighting is unclear. Prigozhin claims that Wagner forces haven’t been in the country for the last two years.

If Sudan was the "key to Africa" for Prigozhin, then the neighboring Central African Republic has become his primary base. Nowhere else can Wagner Group forces feel as at home as here. They have managed to accomplish what experts refer to as "state capture," the almost complete infiltration of all state functions.

Russian soft and hard power found ideal conditions in the country. A civil war has been raging since 2012 and the power vacuum grew even larger in 2016, when the former colonial power of France brought its military intervention to an end. A UN mission failed to provide much help. President Faustin-Archange Touadéra ultimately turned to Moscow, with the Russians officially sending trainers in 2018, in addition to light weapons for the army.

The trainers were Wagner mercenaries who got involved in the fighting themselves. In December 2020, they stopped a rebel advance on the capital, a success that Prigozhin’s people quickly turned into an action film that had its premiere in May 2021 in the stadium of Bangui, the country’s capital. They managed to keep President Touadéra in office and were able to take back large towns and main traffic arterials. Before long, they provided the presidential guard and Touadéra’s senior security advisers.

Prigozhin’s people have a say in passing laws and installing or deposing politicians. Sometimes, Wagner mercenaries even directly collect customs payments at the country’s borders. Prigozhin’s people organize cultural events in the country and operate a radio station. Since 2019, Russian has been taught in the country’s schools.

And just as in Sudan, Prigozhin’s companies have gained access to natural resources in the Central African Republic, including diamond and gold mines, but also to tropical hardwoods. As DER SPIEGEL recently reported together with its partners from the investigative network European Investigative Collaborations and the non-governmental organization All Eyes on Wagner, the mercenary group relies on a convoluted maze of companies to do so, with names like Lobaye Invest, Diamville and Bois Rouge.

French President Emmanuel Macron has referred to Touadéra as a "hostage of the Wagner Group," and France suspended military and financial aid to the country in 2021. Russia – with Prigozhin’s help – succeeded in driving the former colonial power of France out of the country. This pattern would be frequently repeated, most obviously in Mali.

Wagner Group mercenaries have been active in that country since 2021 at the invitation of the governing putschists, with their number estimated at between 1,000 and 1,600. They have far less influence on the government here than in the Central African Republic, but they have introduced a new severity and ruthlessness into the conflict, in which both Germany and France have been unsuccessfully engaged for years. In March 2022, Wagner mercenaries fighting alongside the Malian army killed more than 300 people in Moura, many of them civilians.

The Russians are allegedly helping the government fight Islamist terrorism. "The Russians have an extremely broad definition of what a jihadi is. Sometimes, pants ending above the ankle is enough," a high-ranking European military officer told DER SPIEGEL. The security situation in the country, meanwhile, hasn’t improved. But the Wagner Group has been able to celebrate a different victory: In August 2022, the last French soldier left the country, marking the end of an almost decade-long military intervention by the former colonial power.

The future of the UN peacekeeping mission MINUSMA is also in question. Britain, Egypt and Germany have all announced their intention to pull out their troops.

The Wagner Group’s real success in Africa, says Samuel Ramani of the British think tank Rusi, has not been of a military nature, but in the manner in which they have been able to push through their own interests and in the effect it has had on Russia’s image. A PR victory. "They’ve been very good at 'state capture,' autocracy promotion and advertising Russia’s brand continent-wide," Ramani says. "But they haven’t done very well at fighting terrorism and extremism, which is what they claimed they’re seeking to do."

Ukraine: How Prigozhin Recruited His Army of Prisoners

When Russian troops marched into Ukraine on February 24, 2022, Prigozhin’s mercenaries were not part of the invading army. On social media channels, Wagner Group recruiters turned away those seeking to fight in Ukraine. "Boys, it’s business as usual, no changes. Africa hasn’t vanished from the face of the earth."

All that Prigozhin could do was to write enthusiastic commentaries for his news agency Ria Fan. "Our military columns are driving through the streets of the almost liberated city of Kharkiv, the Nazis in Kyiv are completely surrounded," he enthused on February 27, comparing the "jeweler-like" tactics of the Russian military to "micro-surgery." It wasn't just Vladimir Putin and the Russian Defense Ministry who suffered in early 2022 under the delusion of a rapid victory. Prigozhin, who today is so heavily critical of the army leadership, did as well.

It would take almost an entire month before his troops also entered the war in Ukraine, fighting their first battle on March 3 near Popasna in the Donbas region. The mercenaries were able to take the town in time for May 9, the day Russia celebrates its World War II victory over the Nazis. And it proved to be a triumph for the Wagner Group – not just over the Ukrainians but also over the Russian competition. The regular army, after all, had been forced to break off its advance on Kyiv and was only making slow progress in the Donbas. A short time later, Prigozhin was awarded the country’s highest honor "Hero of the Russian Federation." It was apparently his reward for his victory in Popasna. The order from Putin granting the award remains confidential, but the medal itself is not. In August, if not before, Prigozhin appeared in public wearing the golden star on his chest.

But the real reward from Putin is more valuable than the golden star – it is one that has lifted Prigozhin far above his competitors and far above the Russian legal system: It is his license to recruit fighters from Russian penal colonies. Starting in summer 2022, Prigozhin began touring the country’s prisons to personally recruit convicts. After all, he was familiar with the camps. His recruitment trips began in June at the latest, but it was only in September that a video of him in a colony in the European-Russian republic of Mordovia appeared. It shows Prigozhin standing in front of men dressed in black prisoner garb introducing himself as a representative of the "private military company Wagner."

"I will take you along alive. But I won’t bring you all back alive," he says in the video. His promise: No matter what happened, nobody would return to a prison camp. Those who survived would be pardoned. And those who deserted would be shot.

Even for Russia, it was a bizarre turn, one which made Prigozhin the master of life and death, freedom and bondage. It violates the logic upon which any state – even a dictatorship of the kind created by Putin – is based. It devalues the judiciary. "Why continue to investigate and pass judgment when someone like Prigozhin can come along and simply take the convicts with him?" wonders activist Vladimir Ossetchkin, who promotes prisoner rights. It also devalues military service: Fighting for one’s land suddenly becomes a penalty rather than an honor. And, in the eyes of more experienced Wagner mercenaries, it harms their own fighting machine. "When I heard about it, it was immediately clear to me: That’ll be a fuck up," Andrei Medvedev, a Wagner mercenary who fled to Norway, recalled in a conversation with DER SPIEGEL. He was fighting near Bakhmut when the first of the prisoners arrived and says that their missions immediately became more reckless. "Human life no longer mattered."

For Prigozhin, though, the recruitment of prisoners solved a problem: Mercenary troops aren’t made for wars between large, modern armies. Prigozhin needed the few thousand professionals on his rolls in Africa. He didn’t want to sacrifice them in Bakhmut.

Putin, on the other hand, wanted to rapidly fill the gaps in the Russian lines without asking the Russian populace to make even greater sacrifices. He had promised in March that he wouldn’t send conscripts or reserve soldiers into battle. The war was still supposed to be a mere "special military operation." Addressing Russian society, Prigozhin said: "It’s either prisoners or your children. You decide."

It's not entirely clear how many prisoners he ultimately recruited. Vladimir Ossetchkin estimates the 2022 total to be several tens of thousands. The highest estimates hold that 50,000 men were recruited from prison camps throughout the year.

Vladislav, 26, is one of the men who was recruited in a penal camp by Prigozhin himself. He tells his story as a Russian prisoner of war, sitting in a basement room of the Ukrainian military secret service agency HUR in Kyiv. His face is concealed by a mask.

Vladislav was doing time for aggravated assault in Colony IK-6 in Samara when, as he describes it, the camp began preparing for a prominent visitor. The mobile phones that the prisoners could use in secret suddenly stopped working. Guards had to turn in their radios. Surveillance cameras were dismantled.

On September 27, 2022, Vladislav says, Prigozhin’s helicopter landed directly on the camp premises before he then held a speech before the roughly 1,000 prisoners on the mustering ground, with senior officials from the Russian penitentiary authority at his side. "He said: 'I can get every one of you out of here, no matter what your sentence is. You’ll be free after half a year. You will be fighting on the second line against Nazis.'" Prigozhin, says Vladislav, then explicitly said that he preferred murderers for the task, especially those who had killed more than once. Pay was to be 200,000 to 240,000 rubles, the equivalent of between 2,400 and 2,900 euros.

Vladislav had never before heard of Prigozhin or his Wagner Group. He only had another year to serve, but he was attracted by the promise that his criminal record would be wiped clean. "I could start over again from the beginning, find work, travel out of the country," he says. He immediately volunteered, without even asking his wife – the telephones didn't work anyway. Just over three weeks later, Vladislav was already at the front, not far from Lysychansk.

It was pure hell. He was ordered on five separate occasions to storm enemy positions, he says, and had to defend freshly conquered positions in the meantime. Suddenly, nobody was talking any longer about fighting on the second line.

In the first attack he took part in, he says, one-third of the 60 fighters who headed out before him were badly wounded. "The rest were 200s," he says, using Russian jargon for fatalities. Two men had refused to advance any further, he says, and were "reset to zero" by the commander himself upon their return. That meant: shot to death.

Vladislav was surrounded and wounded, but he managed to make it back. After two days in the hospital, he had to go into battle once again. The fifth advance, again with heavy losses, would be his last.

Other Wagner prisoners of war with whom DER SPIEGEL spoke have similar stories to tell: Recruitment in penal colonies, transfer to the Rostov region near the Ukrainian border, training near the frontlines in the Donbas. Each fighter received a six-digit metal tag with the letter K (for "Project K") and a combat name, which was automatically generated by a computer. Discipline was tight, with desertion, stealing, drinking and drug use all punishable by death. The penalties were carried out by the Wagner Group’s own security service, feared for its brutality. "I saw with my own eyes what they are capable of," says Vladislav, though he didn’t want to say what it was. Even in Ukrainian captivity, his fear remained.

The longer the war lasted and the more prominent Prigozhin became, the louder his critique grew of Russia’s military leaders. In September, the Russian army made a hasty withdrawal from the Kharkiv region; and in November, a more orderly one from Kherson. For a time, it seemed as though Prigozhin was the only one capable of delivering battlefield successes. In early January, his men managed to take control of Soledar, a town neighboring Bakhmut.

But in the detailed victory announcement released by the Russian Defense Ministry, the Wagner Group wasn’t mentioned even once. Only several hours later, a "clarification" was reluctantly added, noting that the "immediate assault" on the city came thanks to "the volunteers from PMC Wagner." Another three months would pass before the army spokesman would again utter the word Wagner.

Already in December, Wagner men had released a video in which they called Chief of the General Staff Gerasimov a "faggot" because they hadn’t received the munitions they needed. In Russian prison parlance, that was a deadly insult, and an apology was apparently demanded of Prigozhin before the munitions question would be resolved. That, at least, is what he said in February, asking indignantly: "Apologize to whom? Confess to whom? One-hundred-forty million Russians, please tell me who should I apologize to so that my guys die half as many times?"

It isn’t clear where exactly Putin stands in the conflict. Last summer, he backed Prigozhin and allowed him to tour the country’s prison camps recruiting fighters. And as recently as October, he created a new command structure for the invading army and placed a Prigozhin ally, General Sergei Surovikin, at the top.

But in January, Putin reversed his decision and swapped out Surovikin with Chief of the General Staff Gerasimov. U.S. military expert Dara Massicot described the move on Twitter as "demoting their most competent senior commander and replacing him with an incompetent one."

"Putin decided at the time that Prigozhin had to integrate himself into the plans of the General Staff," says political analyst Tatiana Stanovaya. But the Wagner Group was not disbanded. It even became known that the son of Dmitry Peskov, Putin’s press spokesman, had joined the Wagner Group – though not as a bit of cannon fodder like the prisoners, but as an artilleryman.

In mid-February, a video found its way onto the internet showing Wagner fighters using a picture of Gerasimov as a target. On February 22, Prigozhin even published an internal document, including a list of munitions, on the internet. The infighting within the Russian army could suddenly be followed on Telegram.

That same day, a meeting was apparently held between Putin, Defense Minister Shoigu and Prigozhin – at least according to a U.S. intelligence memo leaked by a U.S. soldier on the platform Discord.

But the dispute has continued. Prigozhin may be louder, but the army has far more leverage. They can cut off his munitions supplies at any time, and they have also apparently taken away his ability to recruit prisoners. Prigozhin has said that he hasn’t been able to recruit in Russia’s prison camps since February. The Defense Ministry now reserves that privilege for itself.

For the prisoners, that has meant that they are no longer subject to the brutal discipline imposed by the Wagner Group and its security service. But the inhumane system has remained. It's just operated by someone else now.

The Dead: What Remains of Prigozhin

On the search for what will one day remain of Prigozhin in Russia, the village of Bakinskaya is a good place to start. On a recent Sunday morning, the fresh graves of Wagner Group members can be seen from afar, row upon row upon row. On each grave is a plastic floral arrangement in black, yellow and red in the shape of the Wagner emblem, complete with golden stars glittering in the morning sunlight.

The graveyard is located less than 10 kilometers from the neighboring village of Molkino, where the Wagner Group operates a training center. A chapel belonging to the group is also nearby, which is the reason why the tiny village of Bakinskaya is home to a vast cemetery of fighters: DER SPIEGEL counted 45 rows during a visit in early April, more than 600 graves bedecked with Wagner wreaths – 12 times as many as just three months earlier. And they keep coming: A filthy truck with Rostov license plates is standing on the gravel path that runs through the middle of the cemetery, four zinc coffins lined up on its bed, each covered in red cloth. A small digger is excavating in the damp earth, with the workers then carrying the first casket to the new grave. No priest is present.

The graves are bedecked with a simple Orthodox cross or a wooden marker meant to recall an Islamic headstone, each with a name, birthdate and date of death. There is the convicted murderer Roman Tokarev, 30, from the Belgorod region. Alexandr Gavrilov, 23, from Rostov-on-Don, who had been sentenced to seven years for dealing drugs. Their paths led them from Russia’s penal colonies via Ukraine to a village where nobody knows them and where some would rather not have them.

DER SPIEGEL contacted more than 40 family members of Wagner fighters buried in Bakinskaya, but very few were interested in speaking. One of those who did agree to an interview was Larissa, the aunt of Andrei Kargin, 22, who was imprisoned in a penal camp in Volgograd for repeated theft. "He called me and said: I’m going to war on September 30," Larissa says. Six weeks later, he was dead – she received the news over the phone from a Wagner commander. But she was left to find out herself where her nephew’s body was buried. She searched for months, until someone finally sent her a photo of his grave in faraway Bakinskaya. A death certificate still hasn’t been issued, and she doesn’t know why. "They sent Andrushka and all the other prisoners into the meat grinder and turned them into hash."

It isn’t clear how many Wagner fighters have already died in the conflict. The BBC and the Russian outlet Mediazona have reliably established the identities of 3,621 dead prisoners, but that is just a fraction of the real number. Across Russia and in the occupied regions of Ukraine, there are seven devoted Wagner cemeteries, in addition to the uncounted Wagner graves in other cemeteries. In the Krasnodar region alone, DER SPIEGEL found four other cemeteries with fresh graves bearing Wagner wreaths.

Yevgeny Prigozhin visited the cemetery in Bakinskaya in early April, and that is also documented by video. In it, he is wearing his usual military jacket, one of his favorite sayings on the sleeve, a macabre rhyme in Russian: "Cargo 200 – we stay together.” Cargo 200 are the fallen. Prigozhin scans the fresh graves he has left behind, a satisfied look on his face. "Yes, the cemetery is growing,” he says. "Those who fight sometimes die. That’s how life is.” He then continues on his way. The war is calling.

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U.S. President Joe Biden, Germany's Chancellor Olaf Scholz, Britain's Prime Minister Rishi Sunak, European Commission President Ursula von der Leyen, President of the European Council Charles Michel, Italy's Prime Minister Giorgia Meloni, Canada's Prime Minister Justin Trudeau, France's President Emmanuel Macron and Japan's Prime Minister Fumio Kishida visit the Itsukushima Shrine on Miyajima Island in Hatsukaichi, Japan. Kenny Holston/Pool/Editing by Germán & Co

G7 urged to phase out fossil fuels by Netherlands, Chile, others

The leaders of seven nations, including the Netherlands and Chile, have stated that the Group of Seven rich countries must take the initiative in gradually phasing out fossil fuels to create momentum for a worldwide agreement this year.

REUTERS By Kate Abnett, EDITING BY Germán & Co

BRUSSELS, May 19 (Reuters) - Group of Seven rich nations must take the lead in phasing out fossil fuels, the leaders of seven countries including The Netherlands and Chile have said, attempting to build momentum for a global deal this year to gradually quit oil, coal and gas.

Countries including the 27-member European Union are hoping all nations will agree at this year's U.N. climate talks to phase out the fossil fuel consumption causing climate change - reviving an idea that gathered some support at last year's climate talks, but was blocked by oil- and gas-rich countries.

A meeting of G7 leaders in Hiroshima, Japan, which began on Friday, is seen as a test of the appetite among the world's advanced economies to do this.

In a letter to G7 leaders, dated May 18 and seen by Reuters, presidents and prime ministers from seven nations urged them to lead the push for a fossil fuel phaseout deal.

"We must bring the fossil fuel era to an end and phase out fossil fuels. We call on you to take the lead and work with us to agree this at COP28," the letter said, referring to this year's COP28 climate summit, which begins on Nov. 30 in Dubai.

It was also signed by the leaders of New Zealand, plus the Marshall Islands, Palau, Saint Lucia and Vanuatu - four small island states whose vulnerability to climate change has seen them hold outsized political influence in past U.N. talks.

The countries said the G7 should also support efforts to develop new global targets for renewable energy and energy efficiency.

G7 countries' climate ministers agreed last month - for the first time - to accelerate "the phase-out of unabated fossil fuels". It is not clear if their leaders will follow suit.

Other countries have signalled a will to allow the continued use of fossil fuels.

The United Arab Emirates' incoming COP28 president, Sultan al-Jaber, this month urged countries to focus on "phasing out fossil fuel emissions". That could allow countries to keep using fossil fuels, while using technologies to capture the CO2 emissions that result from burning them.

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Seaboard: pioneers in power generation in the country

…“More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Friday Briefing

The U.S. debt limit nears/Balancing the U.S. budget for Ukraine aid

The Pentagon has significantly reduced its estimate of the value of weapons it has sent to Ukraine, freeing up at least $3 billion to supply Ukrainian troops with arms. The calculation comes as the Biden administration has faced intensifying pressure to explain how it intended to continue supporting Ukraine without asking Congress to replenish its budget.

Pentagon and State Department officials yesterday told congressional staff members that they had discovered an accounting issue that could make more resources available before Ukraine’s planned counteroffensive this summer. They had realized their mistake almost two months ago, a senior White House official said.

Instead of placating Congress’s concerns, the revelation was met with frustration and anger, as some lawmakers criticized the Biden administration for what they said was an extremely troublesome error. They called on the administration to “make up for this precious lost time” by sending long-range missiles and cluster munitions to Ukraine, a move that the administration has resisted doing.

The end of al-Assad’s isolation?

In the months since a devastating earthquake struck Turkey and Syria, Bashar al-Assad, the Syrian president, has made a remarkable comeback, going from years of near-total global isolation to a welcome back into the Arab fold with virtually no strings attached. He is today expected to attend an annual summit of Arab leaders for the first time in 13 years.

Assad was shunned for brutally suppressing in 2011 his country’s Arab Spring uprising, which morphed into a grinding civil war. His government stands accused of widespread torture, the use of chemical weapons against its own people and forced population transfers in a conflict that has left hundreds of thousands of people dead.

The Biden administration has made it clear that the U.S. has no plans to re-establish relations with Syria, and Human Rights Watch has urged the Arab countries normalizing ties with the Assad government to at least push for accountability and reforms. Syria’s government is still subject to Western sanctions, but al-Assad does not appear to have paid a heavy price for readmission into the Arab League of leaders.

Repercussions: Analysts said the Syrian war helped set the stage for what the world is now witnessing in Ukraine. The survival of al-Assad’s regime came in large part because of extensive military support from Vladimir Putin, the Russian president. But Russia was never held accountable for the attacks it carried out in Syria, including the targeting of hospitals.

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News round-up, May 18, 2023

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Editorial…

Image: by Germán & Co

The abbey of environmental groups in conflict with the harsh realities of millions of people is complex and challenging.

Maintaining a balance between preserving the environment and making sure that people have access to the resources they require to survive is difficult.

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Why Greta Thunberg and Other Climate Activists Are Protesting Wind Farms in Norway…

“The scene in downtown Oslo this week is hardly unusual in the era of climate protest: chained to doorways and bundled up in thick blankets, Greta Thunberg and dozens of other young activists are blocking the entrance to Norway’s energy and finance ministries to challenge government climate policy. But this time, their target may surprise you: wind farms.” 

TIME BY CIARA NUGENT, FEBRUARY 28, 2023 

Climate Activists Have a New Target: Civilians…

“We don’t want them to think that they can buy a big car and just enjoy their life and ignore what’s going on in the world,” Claude explained to me. He and his two accomplices gave false names as a condition of allowing me to observe their nighttime expedition. The vehicles weren’t damaged, but they’d need a refill or a tire change. Before he left, Claude stuck a leaflet to the windscreen saying, in French: “Don’t take it personally. You are not our target, it’s your car.”

POLITICO EU BY KARL MATHIESEN, MAY 2, 2023 

Burning Man Becomes Latest Adversary in Geothermal Feud

“Festival organizers are trying to block plans to build a clean energy plant in the Nevada desert, highlighting the struggle to combat climate change and the cost of clean power.

NYT By Arielle Paul, May 17, 2023

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By Germán & Co, May 18,2023

Life is indeed a complex journey with many twists and turns that can both bring joy and sorrow. It is these challenges that test our resilience and ability to adapt. Unfortunately, our world and humans are not immune to disasters, whether they be natural or man-made. Pollution, for example, can have devastating effects on our environment and health, while the actions of those who disregard basic moral principles can cause harm to others. One of the most recent challenges is the SARC-2 virus, which has disrupted our daily life.

The SARC-2 virus has had a significant influence on our emotional health since it has pushed us to give up physical contact and rely solely on digital communication.

Human beings have always been praised for their ability to adapt to change quickly, and it's not hard to see why. This unknown time has been a cruel change, as human contact is essential to nourish our souls. Unfortunately, the virus has also had a devastating effect on the global economy. The pandemic has caused a shortage of essential goods, which has triggered a dangerous inflationary spiral. And just when we thought things couldn't get any worse, Russia's invasion of Ukraine further destabilized the economy by disrupting the fossil fuel market.

The invasion of Ukraine by Russia severely weakened the economy by causing a disruption in the fossil fuel industry.

So, that times have been demanding since the pandemic hit, and now with the added stress of the Ukraine war, seeing how some people struggle to meet their basic needs is heart-breaking. It's not easy when you need a lot of money product to inflation —that you don't have it—to buy the essentials like bread, tortillas, and rice. It's even worse when you can't afford to pay your electricity bill or rent, and you're forced to be homeless, exposed to the elements. Sadly, even retirees in wealthy countries must rummage through garbage containers to survive. It's a shame that so few people are speaking out against this injustice.

Of course, without any doubt, climate change is a fundamental issue. As someone deeply concerned about the effects of climate change, it is essential to have open and —honest, realistic, scientific, and human discussions— about the subject is our duty to place as much importance and care into looking out for the welfare of our neighbour’s as we do in safeguarding the environment. We must be careful that what we do doesn't hurt others around us. After all, When there are no humans on the globe, what use is it to have a healthy planet?

Unfortunately, the environmental movement can sometimes use —wrong—information and misleading narratives to sway people's emotions instead of simply presenting the facts. While must we recognize that some of these groups may have begun with good intentions, it takes time to determine their impartiality as they grow into massive corporations with significant wealth and well-compensated staff.

Now, while millions of people try to cope with this challenging situation, especially in Europe, like the rest of the world, on the one hand, politicians try to find urgent solutions to supply the fuel that no longer comes from Russia, on the other hand, by exploring many new and environmentally friendly sources of energy. It's a tricky situation that we can overcome with determination and cooperation. Unfortunately, some environmental groups are more interested in pushing their agenda than helping those in need. These groups have inhumanely boycotted projects vital to the current electricity industry, causing further hardship for those already struggling.

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Source NYT/Editing by Germán & Co

Burning Man Becomes Latest Adversary in Geothermal Feud…

NYT By Arielle Paul, May 17, 2023

One of the darkest towns in America lies roughly 100 miles north of Reno, where the lights are few and rarely lit until one week each summer when pyrotechnics and LEDs set the sky and mountains aglow.

In tiny Gerlach, just outside the Black Rock Desert in Nevada, residents have watched the Burning Man festival grow over the last 30 years to a spectacle of nearly 80,000 countercultural hippies and tech billionaires, offering an economic lifeline for the unincorporated town. Now, Burning Man and Gerlach are more tightly aligned, joining conservationists and a Native American tribe in an alliance against a powerful adversary: Ormat Technology, the largest geothermal power company in the country.

Both Burning Man and Ormat share a vision for a greener future, yet neither can agree on the road to get there.

The festival promotes self-reliance and leaving no trace of its ephemeral metropolis, yet it contributes an enormous carbon footprint; the power company is vested in the future by battling climate change, but its clean energy facilities pose a threat to local habitats while reaping a sizable profit.

The dilemma has complicated similar projects worldwide, underscoring the tension between the need to combat climate change and the cost of doing so using clean power. In the effort for a sustainable future, what compromises must be made?

Experts say the answer comes down to the No. 1 rule in real estate: location, location, location.

“Devil’s in the details with the exact spot,” said Shaaron Netherton, the executive director of Friends of Nevada Wilderness. The organization has joined in a lawsuit to block Ormat’s project, which would explore potential geothermal resources in Gerlach.

Several Ormat initiatives have stalled or been forced to relocate amid concerns about potential threats to endangered species like the bleached sandhill skipper, a rare butterfly; populations of sage-grouse; the steamboat buckwheat; and, most recently, the Dixie Valley toad.

Opponents of Ormat’s project plans in Dixie Valley, Nev., fear it would drain the surface springs and push the tiny toad toward extinction. “Geothermal energy has a dark, dirty little secret: They dry up hot springs every time,” said Patrick Donnelly, the Great Basin director at the Center for Biological Diversity.

Yet other plants, such as Ormat’s Tsuchiyu Onsen plant in Fukushima, Japan, coexist with neighboring hot springs, inspiring the Japanese to reconsider the potential of geothermal energy, which creates electricity using fluids from underground.

Ormat said in a statement that it recognized the value of Nevada’s Black Rock Desert. “Sustaining its resources is not only important to residents but also to our long-term success,” the company said.

Nevada’s geothermal resources have become a controversial topic. The state, known as the “golden child of geothermal,” contributes 24 percent of the country’s geothermal power, the highest after California, and produces nearly 10 percent of its electricity using the earth’s heat.

Ormat has 15 plants in Nevada, which together contribute 433 megawatts to the state’s electrical grid — enough to power 325,000 homes. Geothermal environments, including hot springs, geysers and steam vents found along the “Ring of Fire,” the tectonic pathway encircling the Pacific Ocean, are home to a wide range of biodiverse ecosystems. They can also serve as sacred sites for Indigenous tribes and supply spring water to rural towns like Gerlach.

Loss of drinking water is one of the many concerns Gerlach residents have over Ormat’s proposed project. Another is subsidence, the gradual sinking of land already occurring in certain parts of town.

“They build the plant on the aquifer Gerlach is sitting on, Gerlach will sink,” said Will Roger, who, along with his partner, Crimson Rose, is a founder of Burning Man and have lived in Gerlach for 10 years. “That means the foundations of our houses will break and we’ll get condemned.”

Ormat worked to ensure there would be “no significant environmental or economic losses generated by exploration or development” of the site, the company said in its statement. “Geothermal development can bring numerous benefits to communities, especially in rural towns like Gerlach.”

The aquifer also houses the Great Boiling Springs, studied by the likes of NASA for its rare microbial similarities to conditions on Earth billions of years ago. Locals fear the plant would irreversibly affect the spring by mixing geothermal fluids with groundwater.

These are “geological uncertainties,” said Roland N. Horne, a professor of earth sciences at Stanford University. He explained that older steam plants have dried up hot springs, but most Ormat plants, including the one proposed in Gerlach, run on binary technology in which geothermal water never leaves the ground. Binary power plants create energy through a heat exchanger “with no emissions whatsoever of geothermal fluid or gases,” he said.

Still, binary plants are not foolproof. At Ormat’s nearby Jersey Valley plant, springs dried after operating for a few years. Ormat claims there is no proof the drought was caused by the plant, attributing it instead to a poorly plugged mining core hole.

Complicating matters in Gerlach, the plant would infringe on springs culturally significant to the Summit Lake Paiute Tribe. Randi Lone Eagle, the tribe’s chairwoman, said the Bureau of Land Management failed to adequately consult them before greenlighting the project. “Tribes want to be notified way ahead of that process because a lot of the time, we’re coming to the table when the project is already done,” she said.

The plant’s critics say the town’s 130 residents could also be subject to light, noise and pollution, with desert views and historic emigrant trails sullied by the presence of an industrial plant a hundred feet away. These risks were not weighed when the Bureau of Land Management found “no significant impact” in its environmental assessment of the exploration project.

“It’s kind of a NIMBY thing, but so much more,” said Mr. Roger, the Burning Man co-founder, whose two-acre home has 50 trees, a labyrinth, chickens and an aquaponics system that harvests tilapia and fertilizes their greenhouse. “It’s not just ‘not in my backyard,’ but don’t ruin my backyard.”

Last month, local authorities rescinded a permit for Ormat to “temporarily explore whether a commercially viable geothermal resource exists” in Gerlach, Ormat said in its statement, cuing up what is likely to be a long conflict.

Burning Man organizers say when it comes to their social principles, they practice what they preach. Sustainability projects funded by the Burning Man Project, the nonprofit entity that runs the festival, are sprouting around town. The organization claims that it “owns more than half of the commercial property in Gerlach,” advancing its goal to build a permanent community.

As part of an effort to cut the festival’s annual carbon footprint of 100,000 tons by 2030, the Burning Man Project has outlined green initiatives like supplying more “solar installations for artwork and campers” and “having serious conversations” about what art to burn, Ms. Rose said.

But it’s an ambitious goal. About 90 percent of Burning Man’s emissions are caused by cars, RVs and planes hauling thousands of attendees to the remote desert.

Mr. Roger said he hoped greener grids will beckon more electric vehicles to the festival. Unfortunately, electric cars require lithium-ion batteries mined from plants like the one Fuse Battery plans to build outside of Gerlach and will probably receive similar pushback.

He added that he had no plans to scale down the festival to offset its carbon footprint.

“Burning Man changes lives, so if we can wake people up there, to me all that is worth it,” he said. “I don’t want to lower the number; I’d like to raise it.”

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Most read…

An Untested Oil Price Cap Has Helped Choke Revenue to Russia

Group of 7 leaders are prepared to celebrate the results of a novel effort to stabilize global oil markets and punish Moscow.

NYT By Jim May 18, 2023

Carbon Accounting Changes Could Lift Corporate Greenhouse-Gas Emissions

Some multinationals might be underestimating their emissions by close to 50% under current rules

WSJ By Dieter Holger, May 18, 2023 

The EU should start planning now for Russia after Putin

Political destabilisation could lead to armed conflict within Russia itself. There must be a strategy to contain the fallou

POLITICO EU Alexander Clarkson and Kirill Shamiev, Today

Why the U.S. is so bad at building clean energy, in 3 charts

As Congress battles over the debt ceiling and permitting reform, here’s what’s at stake

WP by Shannon Osaka, Climate zeitgeist reporter, May 18, 2023 

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Germany. Ahead of the meeting, U.S. officials sought to persuade other nations’ leaders to try to cap the price that Russia could command for oil.Credit...Kenny Holston for The New York Times/Editing by Germán & Co

An Untested Oil Price Cap Has Helped Choke Revenue to Russia

Group of 7 leaders are prepared to celebrate the results of a novel effort to stabilize global oil markets and punish Moscow.

NYT By Jim May 18, 2023

*Jim Tankersley is an economics reporter who covers the White House. He has been tracking the Biden administration’s efforts to limit Russia’s oil revenues for the past year.

In early June, at the behest of the Biden administration, German leaders assembled top economic officials from the Group of 7 nations for a video conference with the goal of striking a major financial blow to Russia.

The Americans had been trying, in a series of one-off conversations last year, to sound out their counterparts in Europe, Canada and Japan on an unusual and untested idea. Administration officials wanted to try to cap the price that Moscow could command for every barrel of oil it sold on the world market. Treasury Secretary Janet L. Yellen had floated the plan a few weeks earlier at a meeting of finance ministers in Bonn, Germany.

The reception had been mixed, in part because other countries were not sure how serious the administration was about proceeding. But the call in early June left no doubt: American officials said they were committed to the oil price cap idea and urged everyone else to get on board. At the end of the month, the Group of 7 leaders signed on to the concept.

As the Group of 7 prepares to meet again in this week in Hiroshima, Japan, official and market data suggest the untried idea has helped achieve its twin initial goals since the price cap took effect in December. The cap appears to be forcing Russia to sell its oil for less than other major producers, when crude prices are down significantly from their levels immediately after Russia’s invasion of Ukraine.

Data from Russia and international agencies suggest Moscow’s revenues have dropped, forcing budget choices that administration officials say could be starting to hamper its war effort. Drivers in America and elsewhere are paying far less at the gasoline pump than some analysts feared.

Russia’s oil revenues in March were down 43 percent from a year earlier, the International Energy Agency reported last month, even though its total export sales volume had grown. This week, the agency reported that Russian revenues had rebounded slightly but were still down 27 percent from a year ago. The government’s tax receipts from the oil and gas sectors were down by nearly two-thirds from a year ago.

Russian officials have been forced to change how they tax oil production in an apparent bid to make up for some of the lost revenues. They also appear to be spending government money to try to start building their own network of ships, insurance companies and other essentials of the oil trade, an effort that European and American officials say is a clear sign of success.

“The Russian price cap is working, and working extremely well,” Wally Adeyemo, the deputy Treasury secretary, said in an interview. “The money that they’re spending on building up this ecosystem to support their energy trade is money they can’t spend on building missiles or buying tanks. And what we’re going to continue to do is force Russia to have these types of hard choices.”

Some analysts doubt the plan is working nearly as well as administration officials claim, at least when it comes to revenues. They say the most frequently cited data on the prices that Russia receives for its exported oil is unreliable. And they say other data, like customs reports from India, suggests Russian officials may be employing elaborate deception measures to evade the cap and sell crude at prices well above its limit.

“I’m concerned the Biden administration’s desperation to claim victory with the price cap is preventing them from actually acknowledging what isn’t working and taking the steps that might actually help them win,” said Steve Cicala, an energy economist at Tufts University who has written about potential evasion under the cap.

The price cap was invented as an escape hatch to the financial penalties that the United States, Europe and others announced on Russian oil exports in the immediate aftermath of the invasion. Those penalties included bans preventing wealthy democracies from buying Russian oil on the world market. But early in the war, they essentially backfired. They drove up the cost of all oil globally, regardless of where it was produced. The higher prices delivered record exports revenues to Moscow, while driving American gasoline prices above $5 a gallon and contributing to President Biden’s sagging approval rating.

A new round of European sanctions was set to hit Russian oil hard in December. Economists on Wall Street and in the Biden administration warned those penalties could knock oil off the market, sending prices soaring again. So administration officials decided to try to leverage the West’s dominance of the oil shipping trade — including how it is transported and financed — and force a hard bargain on Russia.

Under the plan, Russia could keep selling oil, but if it wanted access to the West’s shipping infrastructure, it had to sell at a sharp discount. In December, European leaders agreed to set the cap at $60 a barrel. They followed with other caps for different types of petroleum products, like diesel.

Many analysts were skeptical it could work. A cap that was too punitive had the potential to encourage Russia to severely restrict how much oil it pumps and sells. Such a move could drive crude prices skyward. Alternatively, a cap that was too permissive might have failed to affect Russian oil sales and revenues at all.

Neither scenario has happened. Russia announced a modest production cut this spring but has mostly kept producing at about the same levels it did when the war began.

Fatih Birol, the executive director of the International Energy Agency, has called the price cap an important “safety valve” and a crucial policy that has forced Russia to sell oil for far less than international benchmark prices. Russian oil now trades for $25 to $35 a barrel less than other oil on the global market, Treasury Department officials estimate.

“Russia played the energy card, and it didn’t win,” Mr. Birol wrote in a February report. “Given that energy is the backbone of Russia’s economy, it’s not surprising that its difficulties in this area are leading to wider problems. Its budget deficit is skyrocketing as military spending and subsidies to its population largely exceed its export income.”

Biden administration officials say that there is no evidence of widespread evasion by Russia, and that Mr. Cicala’s analysis of Indian customs reports does not account for the rising cost of transporting Russian oil to India, which is embedded in the customs data.

There is no dispute that the world has avoided what was privately the largest concern for Biden officials last summer: another round of skyrocketing oil prices.

American drivers were paying about $3.54 a gallon on average for gasoline on Monday. That was down nearly $1 from a year ago, and it is nowhere near the $7 a gallon some administration officials feared if the cap had failed to prevent a second oil shock from the Russian invasion. Gas prices are a mild source of relief for Mr. Biden as high inflation continues to hamper his approval among voters.

After rising sharply in the months surrounding the Russian invasion, global oil prices have fallen back to late-2021 levels. The plunge is partly driven by economic cooling around the world, and it has persisted even as large producers like Saudi Arabia have curtailed production.

Falling global prices have contributed to Russia’s falling revenues, but they are not the whole story. Reported sales prices for exported Russian oil, known as Urals, have dropped by twice as much as the global price for Brent crude.

The Group of 7 leaders meeting in Japan this week will probably not spend much time on the cap, instead turning to other collective efforts to constrict Russia’s economy and revenues. And the biggest winners from the cap decision will not be at the summit.

“The direct beneficiaries are mostly emerging market and lower-income countries that import oil from Russia,” Treasury officials noted in a recent report.

The officials were referring to a handful of countries outside the Group of 7 — particularly India and China — that have used the cap as leverage to pay a discount for Russian oil. Neither India nor China joined the formal cap effort, but it is their oil consumers who are seeing the lowest prices from it.

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Changes being considered would mean credits from wind or solar projects in one grid region wouldn’t be able to offset fossil-fuel electricity use in another.PHOTO: MICHAEL SOHN/ASSOCIATED PRESS/Editing by Germán & Co

Carbon Accounting Changes Could Lift Corporate Greenhouse-Gas Emissions

Some multinationals might be underestimating their emissions by close to 50% under current rules

WSJ By Dieter Holger, May 18, 2023 

Changes to emissions accounting rules are being considered that could significantly increase carbon footprints for companies claiming to use 100% renewable power in their efforts to decarbonize.

How companies tally greenhouse-gas emissions from their electricity purchases—so-called Scope 2 emissions—was the most popular issue in a recent consultation on updating widely used GHG Protocol carbon accounting rules. Officials are analyzing whether to recommend more granular reporting of Scope 2 emissions, which would improve accuracy but also could lift reported emissions by as much as nearly 50%, according to recent research. The GHG Protocol is used by more than 10,000 companies to calculate their emissions and is expected to underpin international and U.S. climate reporting regulations. 

Under current standards, businesses can claim to be using 100% renewable energy as long as they offset their use of fossil fuel-generated electricity with credits from wind or solar projects in the same general power market, such as the whole of the U.S. or the European Union. For example, a company with a factory in Ohio could buy renewable-energy certificates for power from a Texas wind farm and use the certificates to offset its fossil-fuel electricity consumption in Ohio. 

One change being discussed would restrict emissions accounting to electricity from the same grid region, which would mean these kinds of claims wouldn’t be possible since Texas and Ohio are in separate grid regions. The American power market has three major grid regions, which are divided into 26 subregions, according to the U.S. Environmental Protection Agency. 

Rules limiting renewable-energy claims to within the smaller subregions would improve the accuracy of emissions accounting because companies would be more likely to actually use the renewable electricity paid for with their certificates. 

Another change being discussed would only allow companies to claim they are using renewable energy if the electricity was generated at the same hour of the day that the company was using power from the grid. A 2023 Princeton University study analyzed the emissions effect of location and hourly matching requirements. Lead author, Wilson Ricks, said the restrictions would force companies to do the hard work of sourcing carbon-free electricity to supply their needs when and where these occur. “The result would be that claims of 100% carbon-free electricity become much harder to make, but also much more believable,” Ricks said. 

According to a 2022 study, companies that don’t account for hourly and location data could be under- or overestimating their emissions by 35%. A recent review by carbon management firm FlexiDAO of 22 multinationals that bought renewable electricity across 27 countries found that they could be underestimating their electricity emissions by close to 50% under the current system.

“It gives the false impression of achievement and it’s too easy for companies to say, ‘I’m done. I’m 100% renewable, I’ve bought enough stuff, I’m good to go, I’m zero emissions,’” FlexiDAO Chief Executive Simone Accornero said. “That’s clearly not the case.”

However, respondents to a GHG Protocol survey from November 2022 to March 2023 were split between moving to more granular data or maintaining the current rule’s flexibility, said Kyla Aiuto, research associate at the World Resources Institute, the nonprofit co-managing the GHG Protocol with the World Business Council for Sustainable Development. 

Google’s published comments to the survey supported the change: “Purchasing clean energy on the same grid where consumption occurs is the best way to create an inventory that accurately reflects the physical realities of the grid and directly addresses the emissions associated with a company’s operations.” 

The tech company is aiming to use so-called 24/7 carbon-free energy by 2030, which essentially means using power from clean energy sources like nuclear or renewables in its operations around the clock. Google reached 66% on an hourly basis in 2021. Microsoft has a similar goal and also supports restricting accounting to tighter locations.

However, Emissions First partnership—a group including Facebook -parent Meta, General Motors, Heineken and Amazon —is pushing instead for a new method to be added to the GHG Protocol that allows companies to account for avoided emissions from a renewable-energy investment regardless of where it is in the world.

The broader approach would help deliver a fast, cost-effective and scalable way to decarbonize power grids, said Jake Oster, Amazon Web Services’ director for energy and environment policy in the EMEA region and spokesman for Emissions First.

The GHG Protocol secretariat is reviewing the more than 1,400 survey responses, around 400 of which mentioned Scope 2. Other areas of focus were emissions in the value chain, or so-called Scope 3 emissions, market-based accounting approaches, and corporate accounting and reporting standards.

The group plans to conduct more surveys, convene technical experts and seek feedback on proposals before changes are made. An update could come as early as 2025.

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NYT/Editing by Germán & Co

The EU should start planning now for Russia after Putin

Political destabilisation could lead to armed conflict within Russia itself. There must be a strategy to contain the fallou

POLITICO EU Alexander Clarkson and Kirill Shamiev, Today

Twenty-seven years before the full-scale invasion of Ukraine, in what now seems a very distant past, the European Union considered sanctioning Russia.

In 1995, following Russia’s military intervention in Chechnya, EU leaders suspended the ratification of a planned partnership and cooperation agreement and threatened Moscow with even greater consequences if its war crimes, including the indiscriminate bombing of Chechen civilians, did not stop.

The Boris Yeltsin government dealt with the conflict in Chechnya by unleashing further brutal military force, but Europe eventually backed down and ratified the agreement anyway. In the years that followed, Russia’s leadership went on to dismantle democratic institutions, invade Georgia in 2008 and ignite a war in eastern Ukraine in 2014, the prologue to the full-scale invasion of February 2022.

Looking back at the missed opportunities of the 1990s is a reminder of how immediate dilemmas can lead policymakers to overlook signs of the next crisis on the horizon. As it responds to the carnage caused by Vladimir Putin in Ukraine, the EU cannot afford not to prepare for the next Russian crisis.

The war in Ukraine, much like the war in Chechnya in the 1990s, has put immense pressure on Russia’s stability as a state. It is critical that EU member states and institutions start to plan for a range of postwar and post-Putin scenarios in Russia, including a destabilisation of the Russian political system that could lead even to armed conflict within the country. To protect the collective interests of Europe, including Ukraine, from any future turmoil engulfing Russia, the EU needs a strategy that actively encourages its democratisation, no matter how small the chances of that now seem.

The Kremlin has long dismissed Brussels as a global player. After European condemnation of the brutalities committed during the Chechen wars, Moscow tried to divide and rule, breaking down the bloc’s values-based unity, engaging individual leaders, identifying the most influential member states and their national interests. In many cases, Russia received the amount of economic and political integration with western nations it wanted while sidestepping domestic democratic reform.

Moscow’s cynical fixation on the interests of individual EU member states both reflected and cast a long shadow over the Russian perception of the EU. Even opposition-minded members of Russian civil society viewed the EU as an imbalanced confederation with big powers dictating the bloc’s economic and foreign policies. Economic growth, travel freedoms and cooperation with individual EU member states left them blind to the gradual decline of freedom in Russia. Russian elites acquired foreign language skills and enough stolen or oil-driven wealth to holiday comfortably in western Europe without bothering to endorse democratic values at home.

For Russia’s middle and upper class, this bargain with Moscow and Brussels ended with the invasion of Ukraine. Having lost any influence over Putin, Russian elites chose either to lie low, escape the country, or start infighting by shifting the blame for the crisis on to one another. If Russia manages to avoid a full-scale slide into totalitarianism, what remains of its democratic opposition may finally be able to acknowledge the EU’s capacity to exert transformative progressive power.

Ukrainian frustration with any deeper EU engagement with Russia would be understandable, but fostering a shift away from Russian imperialism would be in the interests of all of Russia’s neighbours. Since Moscow’s current elite will accuse the EU of interfering anyway, the EU has nothing to lose by having a wider debate about democratic reform in post-Putin Russia.

A postwar Russia trying to overcome Putin’s toxic legacy would have much to learn much from an economically prosperous bloc that has brought together and transformed societies that had once fought each other in two world wars.

But EU institutions would have to set out the detailed steps that Russia’s state elite must take as strict conditions for the reopening of trade, travel and investment access to the rest of Europe. They would also provide incentives. A genuine process of reform that launched the rule of law and acknowledged Russia’s post-conflict obligations to Ukraine and other affected states could be rewarded with the promise of negotiations with Brussels.

European distrust of Russia runs deep so the EU should be resolute about verification at every stage of this process. Many Russians are familiar with the principle of “trust but verify”, which underpinned talks on nuclear disarmament in the Gorbachev-Reagan era. But only an unwavering commitment to verification can rebuild trust. As trust is gradually restored, Russia could over time gain integration into the EU’s single market, the basis for Europe’s successful economic and social order.

It might sound premature to discuss strategies for stimulating Russian reform. But there may be only a fragile window of opportunity to support genuine transformation in Russia. It will require Russians to abandon the imperialist delusions of the Putin regime. If they can do so, there may be a path towards a common European home for all. The west must not lose sight of the potential for positive change in Russia, even as it supports Ukraine in its struggle for survival.

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A large solar field north of the Avi Kwa Ame National Monument in Boulder City, Nev., in 2022. (Kyle Grillot for The Washington Post)

Why the U.S. is so bad at building clean energy, in 3 charts

As Congress battles over the debt ceiling and permitting reform, here’s what’s at stake

WP by Shannon Osaka, Climate zeitgeist reporter, May 18, 2023 

The United States has big plans to move away from fossil fuels. By 2050, the Biden administration has promised, the country will have a carbon footprint of zero — thanks to thousands of wind and solar farms, new nuclear and geothermal power plants, electric vehicles and all-electric homes and buildings.

Want to know how your actions can help make a difference for our planet? Sign up for the Climate Coach newsletter, in your inbox every Tuesday and Thursday.

There’s just one problem: The United States really isn’t very good at building clean energy.

This paradox has become a central question in the anxiety-inducing race to raise the debt ceiling this month. Congressional leaders, haggling over how best to avoid default, have suggested that including legislation to speed up the development of energy projects and power lines — known as “permitting reform” — could help cement a final deal. (They have very different ideas of what that legislation should include: Democrats want to focus on building interstate power lines, while Republicans want to speed up the process of building power plants, including fossil-fuel ones.)

But how bad is the United States, actually, at building all the wind, solar and geothermal needed to eliminate carbon pollution? And why does it take years to build seemingly simple projects?

These three charts show why the country is lagging in its quest to build clean energy, and how certain policies could help.

Clean energy projects stuck in line

The United States needs an estimated 950 gigawatts of clean energy and around 225 gigawatts of storage to substantially clean up its electricity sector. But, almost unbelievably, projects accounting for more than 1,200 gigawatts of clean energy and more than 650 gigawatts of storage have already been proposed; they just can’t get connected to the grid.

This little-known bottleneck is blocking clean energy for millions

This is the frustration of the country’s “interconnection queue,” a long line of projects across the country that are waiting to get plugged in to the country’s aging electricity grid. Right now, key areas of the grid are at capacity — imagine a freeway traffic jam — and new wind and solar can’t be added unless the grid is upgraded, which costs developers money. According to data from Lawrence Berkeley National Laboratory, the number of renewable projects waiting in the queue has skyrocketed in recent years.

“It’s kind of a double-edged sword,” said Joe Rand, an energy policy researcher at the Lawrence Berkeley lab. “There’s the really good news that all this clean energy capacity is trying to connect to the grid. But then there’s the backlog and bottlenecks and barriers.”

Many developers end up withdrawing their projects due to the high costs of connecting to the grid. According to Rand’s data, only 21 percent of the projects entering the long line ultimately get built. And for the projects that do get built, getting through the process takes years. It now takes an average of about five years for an energy project to be operational once it enters the queue.

Federal agencies are working on streamlining the process, and the Biden administration has cited this long wait for approval as one area where Congress should act. “Congress should reform the transmission interconnection queue so that new generation projects are not stuck in line,” the White House said in a statement last week.

But one way to alleviate the queue problem is to fix another issue: The slow rollout of transmission lines.

Power lines are painfully slow

Coal and natural gas plants pollute the air and warm the climate, but they do have one upside: They can be on all the time. Wind and solar, however, only produce power at certain times of the day. And some sites are way better (that is, windier or sunnier) than others for producing renewable energy.

“The best sites for wind and solar happen to be in the sunny Southwest or the windy Midwest,” said Johan Cavert, a transmission policy analyst at the think tank the Niskanen Center. “And those areas are just not near the biggest population centers.”

So a country that wants to be largely — around 80 percent, let’s say — powered by renewable electricity needs to have big, interstate transmission lines that carry power from where the renewable energy is generated to where it will be used.

But building transmission lines is slow and complex. Lines often have to cross through states that don’t benefit from them, and the federal government can’t just rubber-stamp those projects. That means that a transmission line can take eight to 15 years to build, slowing progress on clean energy. (A natural gas pipeline, on the other hand, only takes around three years to build.)

A transmission line started now might not be finished until the mid-2030s — well after the point that the United States should have already slashed emissions.

Many Democrats want to prioritize giving the Federal Energy Regulatory Commission more transmission siting authority in any permitting deal. But Republicans argue that authority could infringe on state’s rights.

Local communities push back

As wind and solar farms increasingly gobble up unused land around the country, renewable infrastructure is getting closer and closer to rural communities that aren’t always welcoming of new energy development. In recent years, the number of local communities who have rejected wind and solar farms has risen, according to the Renewable Rejection Database managed by journalist Robert Bryce.

Communities have cited historical heritage, the fear of falling property values, or simply not liking the look of wind and solar as reasons for rejecting projects.

Republicans have suggested narrowing the timeline for environmental reviews, which would ease some of the opposition to energy projects. But this would apply to both fossil fuel projects and clean energy projects — and Democrats worry that loosening the rules under the National Environmental Policy Act might boost oil, gas and coal operations. It currently takes projects an average of 4.5 years to make it through this federal gantlet.

The Biden administration has supported Sen. Joe Manchin III (D-W.Va.)’s plan, which would impose a two-year time limit on reviews and allow developers to sue if the process extends beyond that. This proposal includes more authority for building transmission, but would also approve the natural gas Mountain Valley Pipeline — a sticking point for some Democrats.

It’s still unclear whether a permitting deal will make it across the finish line in the debt ceiling negotiations — and, if it does, how much it will boost renewable energy and transmission. But something will have to change if America wants to reach its clean energy goals.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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News round-up, May 17, 2023

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Quote of the day…

“We have a huge responsibility, supplying the rest of Europe with energy,” Defense Minister Bjørn Arild Gram told POLITICO. “To be a stable, reliable producer of energy, of gas, is an important role for us and we take that very seriously. That is why we are also doing so much to protect this infrastructure.” 

Scouring the seas for Putin's pipeline saboteurs, POLITICO EU.

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Most read…

Row over Russian energy sanctions gatecrashes EU-India summit

As Brussels trumpets new trade ties with the South Asian country, officials are split on whether to target energy embargo loopholes.

POLITICO E.U. BY GABRIEL GAVIN AND BARBARA MOENS, MAY 16, 2023 

What Happens If a Debt Ceiling Agreement Isn't Reached

Joe Biden and Kevin McCarthy Expected to Resume Debt Limit Talks on Tuesday

TIME BY SOLCYRE BURGA, MAY 15, 2023

UBS flags $17 billion hit from Credit Suisse takeover

According to UBS, the assets and liabilities of the combined group will have a negative impact of $13 billion as a result of fair value adjustments. Additionally, it anticipates $4 billion in future legal and regulatory expenses as a result of outflows.

REUTERS By John Revill and Selena Li

EU balks at adding Russian gas pipeline ban to sanctions package

The idea isn’t gaining much traction in Brussels, but Kyiv is pushing hard for sanctions to cover gas pipelines.

POLITICO EU BY GABRIEL GAVIN AND VICTOR JACK, MAY 16, 2023 

Scouring the seas for Putin's pipeline saboteurs

At sea, on the hunt for Russia's pipeline saboteurs.

POLITICO E.U. by CHARLIE COOPER IN BERGEN, NORWAY. PHOTOS BY INGERD JORDAL FOR POLITICO EU/EDITING BY GERMÁN & CO, MAY 16, 2023

Japan embraces G7's gas support but companies may face long-term problems

To achieve its net-zero carbon emission targets and ensure energy security, Japan, the world's largest LNG consumer, is committed to using gas as a transition fuel. However, this commitment contrasts with the demands of the other G7 nations to immediately reduce all fossil fuel consumption.

REUTERS By Katya Golubkova,  Yuka Obayashi and Kate Abnett

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Foreign Secretary Subrahmanyam Jaishankar denies criticism that India is helping Russia circumvent EU sanctions | Erika Santelices/AFP/Editing by Germán & Co

Row over Russian energy sanctions gatecrashes EU-India summit

As Brussels trumpets new trade ties with the South Asian country, officials are split on whether to target energy embargo loopholes.

POLITICO E.U. BY GABRIEL GAVIN AND BARBARA MOENS, MAY 16, 2023 

BRUSSELS — Talk at an EU-India summit on Tuesday was meant to be about tech and trade. But the first high-level meeting of its kind ended up being overshadowed by an apparent loophole in Western sanctions against Russia that allows countries like India to buy up cheap oil, refine it, and then ship it back to Europe for a hefty profit.

Speaking at a press conference in Brussels, Indian Foreign Secretary Subrahmanyam Jaishankar denied criticism that his country was helping Moscow circumvent sanctions. Saying he did not "see the basis" for such allegations, New Delhi's top diplomat said EU rules mandate that "if Russian crude is substantially transformed, it’s not treated as Russian anymore."

In earlier comments to the Financial Times the EU's foreign policy chief Josep Borrell broke ranks to say that Brussels should move to crack down on third countries refining Russian oil and selling the products on to the bloc. "If diesel or gasoline is entering Europe ... from India and being produced with Russian oil, that is certainly a circumvention of sanctions and member states will have to take measures," he said.

The row intruded on what was supposed to be an upbeat summit as Brussels hosted the first meeting of the newly created EU-India Trade and Tech Council, designed to foster cooperation between two of the world's largest democracies. It comes in a week of hectic summit diplomacy that will culminate in a G7 summit in Japan where Russia sanctions will top the agenda.

Indian Trade Minister Piyush Goyal said the EU-India relationship has the potential to be the "defining partnership of the 21st century." The EU is meanwhile keen to build closer ties with India in the aftermath of Russia’s invasion of Ukraine and has also moved to resume negotiations with India on a stalled free trade deal.

However, data from shipping platform Kpler, seen by POLITICO, shows that the South Asian nation has become one of the biggest winners from energy sanctions imposed by the West on Russia in the wake of the war in Ukraine. No longer competing for supplies with Europe and other major economies, India has saved around $89 per ton of crude, an analysis from one state-controlled bank reports.

As a result, since the start of Moscow's full-scale invasion, Indian imports of Russian crude oil have shot up from around 1 million barrels a month to more than 63 million barrels in April alone.

At the same time, its lucrative exports of refined oil products to the EU have skyrocketed, raising concerns that it is simply selling on processed Russian supplies.

European imports of diesel from India saw an almost tenfold increase last month compared to the same time last year, with member states buying over 5 million barrels, while the flow of jet fuel to the Continent soared by more than 250 percent to a total of 2.49 million barrels.

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RUSSIAN OIL EXPORTS TO INDIA HAVE SKYROCKETED ...

Seaborne exports of Russian crude oil to India, in barrels sold per month.

... WHILE INDIA IS SHIPPING MORE FUEL TO THE EU

Seaborne exports of Indian jet fuel and diesel fuel to the EU, in barrels sold per month.

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'Legal but immoral'

In February, the EU imposed a ban on Russian refined oil products, building on an embargo on crude imposed last year. However, fuel from Russian oil produced by refineries in third countries has proven harder to crack down on.

“We have enough evidence that some international companies are buying refinery products made from Russian oil and selling them on to Europe,” Oleg Ustenko, an economic adviser to Ukrainian President Volodymyr Zelenskyy, told POLITICO in March. “It’s completely legal, but completely immoral. Just because it’s allowed doesn’t mean we don’t need to do anything about it.”

Indian Prime Minister Narendra Modi has consistently defied pressure to impose sanctions on Russia or scale back close economic ties with the Kremlin. “India is on the side of peace and will remain firmly there,” he insisted last September, arguing that his country was under no obligation to weigh into the conflict.

"India has a growing population and the government has set up a massive development agenda which needs increasing energy supplies," said Purva Jain, a New Delhi-based analyst with the Institute for Energy Economics and Financial Analysis.

"When geopolitical disturbances happen, economic opportunities are created. Ultimately these decisions are being driven by energy security concerns," she added.

The discussion on sanctions is particularly sensitive given the EU is currently negotiating its 11th sanctions package against Russia, which focuses on fighting the circumvention of existing economic restrictions. Brussels is considering also hitting third countries with penalties if they are found to be breaking its rules. Although India is not top of mind in that discussion, it could open the door for future measures against New Delhi.

Speaking alongside Foreign Minister Jaishankar, the EU's Commissioner for Competition Margrethe Vestager sought to downplay Borrell's comments. If there are concerns to be raised, she said, "it will be with an extended hand, not a pointed finger."

Another thorny issue between the two powerhouses is the bloc's proposal to impose a tariff of up to 35 percent on carbon-intensive imports, including cement and steel, which are among New Delhi's main trade offerings.

New Delhi is planning to take the dispute with Brussels to the World Trade Organization to overturn the plans, which it says amount to protectionism, Reuters reported earlier. The two sides have now agreed to discuss the upcoming measure in the Trade and Tech Council, as POLITICO previously reported. "I am sure the intention is not to create a barrier to trade but to find a way forward," said Goyal.

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PITTSBURGH, PA - APRIL 29, 2019: Former Vice President Joe Biden points to the crowd outside of his first 2020 presidential campaign stop in Pittsburgh, Pennsylvania. Image by Germán & Co via Shutterstock

What Happens If a Debt Ceiling Agreement Isn't Reached

Joe Biden and Kevin McCarthy Expected to Resume Debt Limit Talks on Tuesday

TIME BY SOLCYRE BURGA, MAY 15, 2023

A politically-divided Congress is at a crossroads over raising the U.S. government’s debt ceiling, as the country is on the brink of defaulting on their loans if an agreement isn’t made soon.

The federal debt ceiling was last increased in December 2021, by $2.5 trillion to $31.4 trillion, which the government maxed out in mid-January. The Treasury Department said it has since taken “extraordinary measures” to avoid falling into default on their debt, though Treasury Secretary Janet Yellen warned that the government could run out of money for its bills as early as June 1.

“Given the current projections, it is imperative that Congress act as soon as possible to increase or suspend the debt limit in a way that provides longer-term certainty that the government will continue to make its payments,” Yellen wrote in a letter to House Speaker Kevin McCarthy on May 1.

Lawmakers have made changes to the debt limit more than 100 times since World War II. This year Republicans have vowed to increase the debt ceiling so long as it’s suggested spending cuts are enacted. President Joe Biden, however, wants to see an increase in the debt ceiling separate from any budgetary changes.

Defaulting would “produce an economic and financial catastrophe,” Yellen said in a statement, remarking that the government would not be able to make Social Security payments or invest in future projects. “Congress must vote to raise or suspend the debt limit. It should do so without conditions. And it should not wait until the last minute.”

What are Republicans negotiating for?

On Wednesday, House Republicans passed a spending bill that would increase the debt ceiling but cap federal spending for a decade. The bill, which narrowly passed the House, would also roll back the Biden administration’s energy tax credit, as well as impose certain work requirements on federal social programs, among other measures.

The bill is not likely to move forward in the Democrat-controlled Senate, where many legislators are unhappy with the suggested concessions. President Biden also said he would veto the bill if it reached his desk.

Republicans, however, see it as a step towards negotiations. “We lifted the debt limit; we’ve sent it to the Senate; we’ve done our job,” said House Speaker McCarthy after the bill passed.

What happens if Congress doesn’t reach an agreement?

If no Congressional action is taken and the government reaches its debt ceiling, it will have to default on its financial obligations, although this has yet to happen in history.. This has The government won’t be able to pay salaries for federal employees, veterans’ benefits, and also won’t be able to fund Social Security, affecting some 66 million Americans, though the future of social security is already under question as projections foresee that the fund’s reserves will run out by 2033.

Social Security recipients could temporarily see their checks arrive with a delay, depending on how long it takes politicians to negotiate the debt ceiling.

A default would also seriously impact the global economy, which relies on the relative stability of the United States. The Committee for a Responsible Federal Budget projects that interest rates would increase and investment into Treasury securities would stop, impacting people’s car loans, credit cards, and more.

Previous debt ceiling negotiations were also stalled under the Obama administration, marking a new standard of polarized political battles when it came to discussing the government’s spending budget. In 2011, House Republicans fought for months to decrease the deficit in exchange for a debt ceiling raise, impacting the country’s credit ranking for the first time ever. Discussions culminated two days before the Treasury said the United States would have exhausted all funds. That delay in voting to raise the debt ceiling affected the stock market and led to higher borrowing rates for the U.S. that cost the country an additional $1.3 billion in 2011, according to the United States Government Accountability Office.

President Biden and top congressional lawmakers are set to meet early next week after talks were canceled Friday.

“We’ve not reached the crunch point yet but there’s real discussion about some changes we all could make,” Biden said on Saturday before boarding Air Force One. “But we’re not there yet.”

Correction, May 15

The original version of this story misstated how much the debt ceiling last increased. It increased by $2.5 trillion, not from $2.5 trillion.

Image by Germán & Co

UBS flags $17 billion hit from Credit Suisse takeover

According to UBS, the assets and liabilities of the combined group will have a negative impact of $13 billion as a result of fair value adjustments. Additionally, it anticipates $4 billion in future legal and regulatory expenses as a result of outflows.

REUTERS By John Revill and Selena Li

A logo of Swiss bank UBS is seen in Zurich, Switzerland March 29, 2023. REUTERS/Denis Balibouse

May 16 (Reuters) - UBS Group AG (UBSG.S) expects a financial hit of about $17 billion from the takeover of Credit Suisse Group AG (CSGN.S), the bank said in a regulatory presentation as it prepares to complete the rescue of its struggling Swiss rival.

UBS estimates a negative impact of $13 billion from fair value adjustments of the combined group's assets and liabilities. It also sees $4 billion in potential litigation and regulatory costs stemming from outflows.

UBS, however, also estimated it would book a one-off gain stemming from the so-called "negative goodwill" of $34.8 billion by buying Credit Suisse for a fraction of its book value.

The financial cushion will help absorb potential losses and could result in a boost to the lender's second-quarter profit if UBS closes the transaction next month as planned.

UBS said the estimates were preliminary and the numbers could change materially later on. It also said it might book restructuring provisions after that, but offered no numbers.

"The financial information lacks an estimate of restructuring provisions as these will be booked after the transaction closes," Vontobel analyst Andreas Venditti said in a note.

Analysts at Jefferies have estimated restructuring costs, litigation provisions and the planned winding down of the non-core unit could total $28 billion.

Meanwhile, UBS has implemented a number of restrictions on Credit Suisse while the takeover is underway.

In certain cases, Credit Suisse cannot grant a new credit facility or credit line exceeding 100 million Swiss francs ($113 million) to investment-grade borrowers or more than 50 million francs to non-investment-grade borrowers, a UBS filing showed.

"Credit Suisse obviously found itself in a problem because of lapses in its risk controls and I think just setting these parameters on the ability or standards to lend out is not very unreasonable," said Benjamin Quinlan, Hong Kong-based chief executive of financial consultancy firm Quinlan & Associates

"Ultimately, from UBS' perspective, they will have to wear these risks on their books."

Credit Suisse also cannot undertake capital expenses of more than 10 million francs as part of the restrictions or enter into certain contracts worth more than 3 million francs per year.

The filing shows Credit Suisse cannot order any "material amendments" to its employee terms and conditions, including remuneration and pension entitlements, till deal closure.

The restrictions "will cause certain clients to leave Credit Suisse" but may not accelerate the pace of outflows already seen, said Quinlan, following UBS' statement last week that Credit Suisse had already stemmed asset outflows.

RUSHED INTO DEAL

UBS said it was rushed into the deal and had less than four days to complete due diligence given the 'emergency circumstances' as Credit Suisse's financial health worsened.

UBS agreed in March to buy Credit Suisse for 3 billion Swiss francs ($3.4 billion) in stock and to assume up to 5 billion francs in losses that would stem from winding down part of the business, in a shotgun merger engineered by Swiss authorities over a weekend amid a global banking turmoil.

The deal, the first rescue of a global bank since the 2008 financial crisis, will create a wealth manager with more than $5 trillion in invested assets and over 120,000 employees globally.

The Swiss state is backing the deal with up to 250 billion Swiss francs in public funds.

Switzerland's government is providing a guarantee of up to 9 billion francs for further potential losses on a clearly defined part of Credit Suisse portfolio.

UBS signaled no quick turnaround for the 167-year-old Credit Suisse, which came to the brink of collapse during the recent banking sector turmoil after years of scandals and losses.

It said it expected both the Credit Suisse group and its investment bank to report substantial pre-tax losses in the second quarter and the whole of this year.

Following the legal closing of the transaction, UBS Group AG plans to manage two separate parent companies – UBS AG and Credit Suisse AG, UBS said last week. It has said the integration process could take three to four years.

During that time, each institution will continue to have its own subsidiaries and branches, serve its clients and deal with counterparties.

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G7 members like Germany and Italy still have pipeline links to Russia, even if their flow of gas has drastically dropped | John MacDougall/AFP/Editing by Germán & Co

EU balks at adding Russian gas pipeline ban to sanctions package

The idea isn’t gaining much traction in Brussels, but Kyiv is pushing hard for sanctions to cover gas pipelines.

POLITICO EU BY GABRIEL GAVIN AND VICTOR JACK, MAY 16, 2023 

The EU is unlikely to amend its 11th Russia sanctions package to permanently shut natural gas pipelines the Kremlin turned off following its invasion of Ukraine, even though it's up for discussion at the upcoming G7 summit, diplomats told POLITICO.

According to draft conclusions seen by the Financial Times, the G7 club of rich democracies meeting in Japan is mulling a measure that would bar countries like Germany and Poland from resuming imports of natural gas from Russia even if the Kremlin decides to turn the taps back on.

But that would have to be accepted by G7 members like Germany and Italy, which still have pipeline links to Russia, even if the gas flowing through them has dropped off to almost nothing, and EU officials and analysts say there is no consensus in support of the idea.

“From what I hear, it is very unlikely this will pass,” said one diplomat from an EU country that had its Russian gas cut off last year, speaking on condition of anonymity to discuss the sensitive negotiations.

“There is too much resistance from the countries dependent on the remaining gas,” the diplomat added. “The 11th sanctions package is almost done and inserting this huge measure at this moment is not going to work.”

Before the full-scale invasion of Ukraine, Russia supplied over 40 percent of the EU's gas imports. That's now fallen to less than 8 percent, according the Bruegel think tank.

Two of the largest prewar routes, the undersea Nord Stream pipeline to Germany and the Yamal pipeline running across Poland, have seen flows drop to zero. Transit via pipelines running across Ukraine is about a quarter of the prewar level, with only the TurkStream pipeline across the Black Sea running at levels similar to before the invasion.

Russia has dangled the possibility of reopening the taps; President Vladimir Putin in October said his country is ready to restart supplies if necessary.

The G7 gambit is designed to “curb attempts to resurrect Nord Stream,” above all to quell voices in Germany and any other countries where there “may be companies and consumers who may be interested in resuming imports” of Russian pipeline gas one day, said Aura Sabadus, a senior analyst at the market intelligence firm ICIS.

It could also help build pressure for including pipelines in an eventual 12th round of EU sanctions.

That's exactly what Kyiv hopes will happen.

“The prohibition of pipeline imports of Russian gas can be a good symbolic step,” Ukrainian Energy Minister German Galushchenko told POLITICO. “It could disable one comfortable way for Russia to blackmail the EU and corrupt European politicians.”

The European Commission declined to comment on the pipeline sanctions report.

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Scouring the seas for Putin's pipeline saboteurs

At sea, on the hunt for Russia's pipeline saboteurs.

POLITICO E.U. by CHARLIE COOPER IN BERGEN, NORWAY. PHOTOS BY INGERD JORDAL FOR POLITICO EU/EDITING BY GERMÁN & CO, MAY 16, 2023

It’s an hour before dawn breaks over the North Sea. Aboard the KV Bergen, the officer of the watch is wide awake. 

The 93-meter long Norwegian Navy Coast Guard vessel is on patrol, 50 miles out to sea. The sky is dark, the sea darker. But off the starboard bow, bright lights gleam through the rain and mist. Something huge and incongruous is looming out of the water, lit like a Christmas display.  

“Troll A,” says Torgeir Standal, 49, the ship’s second in command, who is taking the watch on this bleak March morning. 

It’s a gas platform — a big one.  

View fullsize

Image: by Germán & Co via Shutterstock

When it was transported out to this desolate spot nearly 30 years ago, Troll A — stretching 472 meters from its seabed foundations to the tip of its drilling rig — became the tallest structure ever moved by people across the surface of the Earth. Last year, Troll, the gas field it taps into, provided 10 percent of the EU’s total supply of natural gas — heating homes, lighting streets, fueling industry. 

“There are many platforms here,” says Standal, standing on the dark bridge of the Bergen, his face illuminated by the glow from the radar and satellite screens on his control panel. “And thousands of miles of pipeline underneath.” 

And that’s why the Bergen has come to this spot today. 

In September 2022, an explosion on another undersea gas pipeline nearly 600 miles away shook the world. Despite three ongoing investigations, there is still no official answer to the question of who blew up the Nord Stream pipe. But the fact that it could happen at all triggered a Europe-wide alert.

Against a backdrop of growing confrontation with Moscow over its brutal invasion of Ukraine and its willingness to use energy as a weapon, the vulnerability of the undersea pipes and cables that deliver gas, electricity and data to the Continent — the vital arteries of comfortable, modern European life — has been starkly exposed. 

In response, Norway, alongside NATO allies, increased naval patrols in the North Sea — an area vital for Europe’s energy security. The presence of the Bergen, day and night, in these unforgiving waters, is part of the effort to remain vigilant. The task of the men and women on board is to keep watch on behalf of Europe — and to stop the next Nord Stream attack before it happens. 

The officers of the watch 

But what are they looking for? 

In recent weeks the Bergen has tracked the movements of a Russian military frigate through the North Sea — something that it has to do “several times every year,” says Kenneth Dyb, 47, the skippsjef, or commander of the ship. 

The Russians have a right to sail through these seas out to the Atlantic, and it is very unlikely Moscow would be so brazen as to openly attack a gas platform or a pipeline. But, says Dyb, as his ship steams west to another gas and oil field, Oseberg, “it’s important to show that we are present. That we are watching.” 

Recent reports that Russian naval ships — with their trackers turned off — were present near the site of the Nord Stream blasts in the months running up to the incident have reinforced the importance of having extra eyes on the water itself. 

Of course, the gas didn’t come for free. Norway has profited hugely from the spike in gas and oil prices that followed Putin’s invasion of Ukraine. The state-owned energy giant Equinor made a record $75 billion profit in 2022. Oslo is sensitive to accusations of war profiteering — and keen to show Europe that it cares about its neighbors’ energy security as much as it cares about their cash. 

But the threat to the pipelines could also be more low-key. One of the many theories about the Nord Stream attack is that it was carried out by a small group of divers, operating from an ordinary yacht. In such a scenario, something as seemingly innocent as a ship suddenly going stationary, or following an unaccustomed course through the water, could be suspicious. The Bergen’s crew have the authority to board and inspect vessels that its crew consider a cause for concern.  

Russia’s covert presence in these waters has been acknowledged by Norway’s intelligence services in recent weeks. A joint investigation by the public broadcasters in Norway, Sweden, Denmark and Finland uncovered evidence of civilian vessels, such as fishing ships, being used for surveillance activities. This is something that has been “going on forever,” according to Ståle Ulriksen, a researcher at the Royal Norwegian Naval Academy, but it has increased in intensity in recent years. 

NORWAY'S GAS NETWORK

The map below shows gas-extraction sites in the North Sea, colored in dark purple. Gas reaches its destination, both in Norway and in othe European countries, via pipelines that are mostly underwater. The longest pipleine is 1,164 kilometers long and goes from the Nyhamna plant to Easington, in the U.K. The one going to Niechorze, in Poland, is 900 km long.

Source:Norwegian Petroleum Directorate

“We always look for oddities, anything that is unusual, like new ships in the area that have not been here before,” says Magne Storebø, 26, senior petty officer, as he takes the afternoon watch on the bridge later that day. 

The sky is leaden and the horizon lost in cloud. Coffee in hand, Storebø casts his eye over the radar and satellite screens as giant windscreen wipers whip North Sea spray from the floor-to-ceiling windows. There are few ships around, all of them familiar to the crew; service vessels plying back and forth from the gas and oil platforms. 

The Nord Stream incident and the new security situation has changed the way Storebø thinks about his work, he says. 

He is “more aware of the consequences suspicious vessels could have,” he says. “More awake, you could say.”   

Soft-spoken and calm beyond his years, Storebø is philosophical about the potential dangers of his work. He has been in the Navy for four years, in which time war has broken out on the European continent and the threat to his home waters has come into sharp focus. 

 “If you are going to put a rainy cloud over your head and bury yourself down, I don’t think the Navy or the coastguard is the right place to work in,” he says in conversation with two shipmates later that day. “You need to adjust and to look in a positive direction — and to be ready in case things don’t go that way.” 

Energy war round two 

As Europe emerges from the first winter of its energy war with Russia, its gas supplies have held up better than almost anyone expected. 

But as the Continent braces for next winter, the risk of another Nord Stream-style attack to a key pipeline is taken seriously at the highest levels of leadership. 

“Things look OK for gas security now,” said one senior European Commission official, speaking on condition of anonymity to discuss sensitive matters of energy security. “But if Norway has a pipeline that blows up, we are in a different situation.” 

EU policymakers see four key risks to gas security going into next winter, the senior official added: exceptionally cold weather; a stronger-than-expected Chinese economic recovery hoovering up global gas supply; Russia cutting off the remaining gas it sends to Europe; and last but not least, an “incident” affecting energy infrastructure. 

Such an event might not only threaten supply but could potentially spark panic in the gas market, as seen in 2022, driving up prices and hitting European citizens and industries in the wallet. And nowhere is the potential for harm greater than in the North Sea. 

Norway is now Europe’s biggest single supplier of gas. After Russian President Vladimir Putin and the energy giant Gazprom shut off supply via Nord Stream and other pipelines, Norway stepped up its own production in the North Sea, delivering well over 100 billion cubic meters to the EU and the U.K. in 2022. European Commission President Ursula Von der Leyen visited Troll A herself in March this year — the first visit of a Commission president to Norway since 2011 — to personally thank the country’s president, Jonas Gahr Støre, for supplies that “helped us through the winter.” 

“We have a huge responsibility, supplying the rest of Europe with energy,” Defense Minister Bjørn Arild Gram told POLITICO. “To be a stable, reliable producer of energy, of gas, is an important role for us and we take that very seriously. That is why we are also doing so much to protect this infrastructure.” 

The vast majority of that gas is transported into northwest Europe via a complex network of seabed pipes — more than 5,000 miles of them in Norway’s jurisdiction alone. The North Sea has an average depth of just 95 meters. That’s not much deeper than the Nord Stream pipes at the location they were attacked.  

“It actually doesn’t take a particularly sophisticated capability to attack a pipeline in relatively shallow waters,” says Sidharth Kaushal, research fellow at the Royal United Services Institute think tank in the U.K.A small vessel, “some divers and an [explosive] charge” are all it could take, Kaushal says. 

The navy chief 

After the Nord Stream incident in September, suspicion instantly fell on Russia. Moscow has a record of operating in the so-called gray zone — committing hostile acts short of warfare, often covertly.  

To date, the three investigations looking into the incident have yet to confirm that suspicion. But European governments — and their militaries — are not taking any chances. 

In the days immediately following the explosions, NATO navy chiefs started calling each other to try to coordinate efforts to protect energy infrastructure, says Rune Andersen, the chief of Norway’s navy, speaking to POLITICO at Haakonsvern naval base, before the KV Bergen’s voyage. 

Everyone had the same thought, he says. “If that happens in the North Sea, we will have a problem.”  

Andersen joined the Navy as a young man in 1988, in the last days of the Cold War. Now 54, he is used to the Russian threat overshadowing Norway’s and Europe’s security. 

“After decades of attempts to integrate or cooperate with Russia, we now have war in Europe. We see that our neighbor is brutal and willing to use military force,” he says grimly. “I worked in the Navy in the ’90s when it was enduring peace and partnership on the agenda. We are back to a situation where our job feels more meaningful — and necessary.” 

Kenneth Dyb, the skippsjef, or commander of the ship

However, he points out, his own forces have so far not seen any Russian movements or operations “that are different to what they were before” the Nord Stream attacks. “The job we are doing is precautionary, rather than tailored to any specific threat,” he adds. 

Even so, those early discussions with NATO allies have now formalized into daily coordination via the Allied Maritime Command headquarters in the U.K., to ensure there are always NATO ships on hand that can act as “first responders” to potential incidents. British, German and French ships have joined their Norwegian counterparts in the monitoring and surveillance effort. 

It is “by nature challenging” to protect every inch of pipeline, all of the time, Andersen says. 

The role of the Bergen and ships like it, he adds, is just “one bit of the puzzle.” Simply by their presence at sea, these ships increase the chances of catching would-be saboteurs in the act, and hopefully deter them from trying in the first place.  

The goal, in other words, is to reduce the size of the “gray zone” — or to “increase the resolution” of the navy’s picture of the activity out on the North Sea, as Andersen puts it. 

In collaboration with the energy companies and pipeline operators, unmanned underwater vehicles — drones — using cameras and high-resolution sonar have been used, Andersen says, to “map the micro-terrain” around pipelines. These are sensitive enough to spot an explosive charge or other signs of foul play. 

Equinor, alongside the pipeline operator Gassco, has carried out a “large inspection survey” of its undersea pipeline infrastructure, a company spokesperson says. The survey revealed “no identified signs of malicious activities” but pipeline inspections are ongoing “continuously.” 

Senior Petty Officer Simen Strand speaks to the crew. “We haven’t had much to fear in the past, we are probably less naïve nowadays,” he says.

Perhaps understandably, the heightened level of alert has led to the occasional false alarm. A spate of aerial drone sightings near Norwegian energy infrastructure around the time of the Nord Stream attacks last year included a report of a suspicious craft circling above Haakonsvern naval base itself. 

“After a while, we concluded it was a seagull,” says Andersen, with the shadow of a grin.  

Europe on alert 

The navy chief is nonetheless deadly serious about the potential threat. A Nord Stream-style attack in the North Sea is possible. Anderson will not be drawn on the most vulnerable points in the network, saying only that “easy to access” places and “key hubs” are “two things in the back of mind when we think [about] risk.” 

Throughout Europe, the alert has been raised. This month, NATO warned of a “significant risk” that Russia could target undersea pipelines or internet cables as part of its confrontation with the West. 

Several countries are increasing patrols and underwater surveillance capabilities. The British Royal Navy accelerated the purchase of two specialist ocean surveillance ships, the first of which will be operational this summer. The EU and NATO have established a new joint task force focusing on critical infrastructure protection, and a “coordination cell” has been established at NATO headquarters in Brussels to improve “engagement with industry and bring key military and civilian stakeholders together” to keep the cables and pipelines secure. 

Norway — and Europe — are in this struggle for the long haul, Andersen believes.  

Indeed, even as Europe transitions from fossil fuels to green energy, the North Sea will remain a vital powerhouse of offshore wind energy, with plans for a huge expansion over the next 25 years. Earlier this year, the Netherlands’ intelligence services reported a Russian ship seeking to map wind farm infrastructure in the Dutch sector of the North Sea. “We think the Russians wanted to investigate the possibilities for potential future sabotage,” Jan Swillens, head of the Dutch Military Intelligence and Security Service tells POLITICO in an emailed statement. “This incident makes clear that these kinds of Russian operations are performed closer than one might think.” 

At the same time in the Baltic, countries are shoring up security around their infrastructure, at sea and on land. Late last year, Estonia carried out an underwater inspection of the two Estlink power cables and the Baltic Connector gas pipeline linking it to Finland, the Estonian navy says. Lithuania, meanwhile, is paying “special attention” to security around its LNG terminal at Klaipėda and the gas cargoes that arrive there, a defense ministry spokesperson says. 

It was in Lithuania that Europe had its first major false alarm since the Nord Stream incident, when a gas pipeline on land exploded on a Friday evening in January. Foul play was briefly considered a possibility in the immediate aftermath but was quickly ruled out. The pipe was 40 years old, and had been subject to a technical fault. 

The danger posed by Russia to infrastructure throughout Europe should not be underestimated, says Vilmantas Vitkauskas, director of Lithuania’s National Crisis Management Centre and a former NATO intelligence official. 

“We know their way of thinking, [the way] they send signals or apply pressure,” Vitkauskas says. “We understand Russia quite well, and we are quite worried by what we see — and how vulnerable our infrastructure is in Europe.” 

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The watchers on the water 

Back aboard the Bergen, life for the sailors carries on as normal. It’s a young crew, with an average age of around 30. Some are conscripts. It’s still compulsory in Norway for 19-year-olds to present themselves for national service, but only around one in four are actually recruited for the mandated 19-month stint.   

The days are long. Surveillance, maintenance and exercises in search and rescue are all part of the crew’s regular routine. A helicopter from one of the Oseberg oil and gas platforms soars overhead, and the crew are drafted into an exercise winching people on and off the deck of the Bergen in the dead of night, simulating a rescue operation. 

The ship needs to be ready to respond to an incident should the call come in from naval headquarters that help is required, or a suspicious vessel has been identified in their patch of the North Sea. But in their downtime, the sailors head to the gym on the lower deck, or play FIFA on the X-box in the sparse games room. Three hearty meals a day are served in the galley kitchen. There is even a ship’s band, cheekily named “Dyb Purple” after their commander. Dyb “takes it well,” says Senior Petty Officer Storebø. 

In the daily whirl of activity, most of the young sailors don’t think of their work in the grand strategic sense of protecting the energy security — the warmth, the light, the industry — of an entire continent. 

But the context of the Ukraine war — and the precedent set by the Nord Stream attack — has added a note of solemnity just below the surface of the comradeship and bonhomie. 

“We are probably less naïve nowadays,” says 33-year-old Senior Petty Officer Simen Strand, who has a wife and two children, a boy and a girl, back home in Bergen. “We haven’t had much to fear in the past, there hasn’t been a concrete threat.” 

Storebø agrees but is characteristically sanguine. “Russia has always been there … I’ve not personally felt any more unease than before.” 

The next day, Storebø has the night watch, from midnight to four in the morning, as the Bergen travels back to base for a short stop before heading out to sea again.  

It’s dark up on the bridge, with the glow of the control panel screens the only light inside. Twenty miles away, little lights can be seen on the Norwegian coast. A lighthouse flares to the south, at Slåtterøy, not far from Storebø’s home island of Austevoll. Beneath the waves, unseen, gas flows from the Troll field back to the mainland, where it is processed. From there, it continues its journey south to light the dark of European nights.  

All is quiet but Storebø can’t afford to lose focus. “Coffee and music help,” he says. “I like the night shifts.”  

As the officer of the watch, he has to be ready, should the radar, the satellites, or his own eyes see something out of the ordinary — ready to call the captain and raise the alarm. 

That’s the job, he says. “You always have it in the back of your mind.” 

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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A liquefied natural gas (LNG) tanker is tugged towards a thermal power station in Futtsu, east of Tokyo, Japan November 13, 2017. REUTERS/Issei Kato/File Photo/Editing by Germán & Co

Japan embraces G7's gas support but companies may face long-term problems

To achieve its net-zero carbon emission targets and ensure energy security, Japan, the world's largest LNG consumer, is committed to using gas as a transition fuel. However, this commitment contrasts with the demands of the other G7 nations to immediately reduce all fossil fuel consumption.

REUTERS By Katya Golubkova,  Yuka Obayashi and Kate Abnett

TOKYO, May 17 (Reuters) - Japan's energy companies were quick to embrace the G7's support for natural gas investment in their statement last month but analysts caution that relying on the fossil fuel may open the companies up to long-term problems.

Resource poor Japan, the world's biggest buyer of liquefied natural gas (LNG), is committed to gas as a transition fuel to reach its net-zero carbon emission goals while ensuring energy security but that conflicts with the demands from other G7 members to curb all fossil fuel use sooner rather than later.

a new report said on Tuesday.00:1001:54

Japan's insistence on continuing to rely on gas may delay reaching global climate change goals, especially as its energy companies reap large profits from their investments in the sector, climate activists say.

The meeting of G7 climate ministers eventually agreed last month, despite tussles between Japan and European nations, that gas investments "can be appropriate to help address potential market shortfalls" as a result of Russia's invasion of Ukraine and the disruptions it has caused to global energy markets.

On Monday, Takehiro Honjo, the chairman of the Japan Gas Association, said the fact the G7 made it clear that it is appropriate to invest in natural gas mitigates some of investment risk for Japanese companies looking to continue their spending on projects.

But analysts warn that in the long-term Japan's goals to cut out carbon emissions from its energy sector will reduce the value of future gas projects.

"The short lead time of shale gas or LNG export projects as well as the contract flexibility fit well with what major consumers including Japan and Europe are looking for in the era of uncertainty," said Yoko Nobuoka, senior analyst of Japan power research at Refinitiv.

"But I think Japanese companies will generally hesitate to be involved in gas projects in the future, especially those with long lead times. The main reason is the country's long-term decarbonization ambition," she said.

Japan's support for gas clashes with findings that new investments in gas, which is mainly composed of the greenhouse gas methane and produces CO2 emissions when burned for energy, would undermine climate goals.

The International Energy Agency (IEA) has said no new investments in fossil fuel supply can be made if the world is to limit global warming to 1.5 degrees Celsius (2.7 Fahrenheit).

But, gas investments have been lucrative for Japan's energy companies resulting in record profits.

Other G7 nations, including Germany, have also spent money on LNG infrastructure after the Ukraine invasion.

Japan's is also acutely dependent on gas from Russia, the country's third-largest supplier, especially from the Sakhalin Island LNG project.

"IMPORTANT RESOURCE"

Because of that dependency, Japanese energy companies are keen to diversify their gas supply sources to include Australia and the U.S.

Trading house Marubeni Corp (8002.T) believes gas "will be utilised as a very important resource in the future", Chief Executive Officer Masumi Kakinoki said last week.

Tokyo Gas (9531.T), the Japanese capital's main gas supplier with assets in LNG and other fossil fuels, also hailed the G7 language on gas as it plans to keep investing in gas infrastructure in Asia and U.S. shale gas upstream assets.

Japan's biggest oil refiner Eneos Holdings (5020.T) plans to invest 180 billion yen over the three years in its oil and gas upstream segment, including for the additional development of LNG in Asia.

But, Japan's stated intention to lower its carbon emissions may mean these gas investments carry some risk.

The G7 climate and energy ministers also set big new collective targets for solar power and offshore wind capacity, agreeing to speed up renewable energy, which may eat into gas demand.

The IEA sees global gas consumption reaching a plateau this decade and data from Japan's finance ministry shows that demand in the country is on a downwards trajectory over the past few months.

Gas assets, both upstream and LNG, could start to be seen as stranded already in around 2030, Refinitiv's Nobuoka said.

"New investments in gas not only risk being stranded but will also likely fail to deliver the needed transition", said Maria Pastukhova, senior policy advisor at independent climate think tank E3G.

"There are ample clean energy solutions that can deliver energy access and security faster and in a more sustainable way."

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News round-up, May 16, 2023

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As the sun rises and the world slowly awakens, my mind drifts to the philosophical concept of the "Principle of Sufficient Reason."

It was four o'clock in the morning, and the light of the new day was present here in Karlstad, Sweden, a beautiful city near the border of Norway, just one hundred and fifty-eight kilometres from Oslo. The light of early dawn reminded me of a piece I wrote last year on the famous chess match between Fischer and Spassky in Reykjavik, Iceland, back in 1972.

The article, "Fischer vs. Spassky, draw, game no. 20”, an analog on the present natural gas supply crisis rocking Europe, drew comparisons between the intensity of the match and the ongoing energy crisis in the continent:

—”To be more precise, it is tucked away in the icy Atlantic Ocean in its northern universe, far from the economic and geopolitical nightmares of its smaller cousin, the Baltic Sea. If there is one fascinating thing because of its complexity and inexplicable intelligence, it is the creation of the biospheres in which we live and, why not say it, the conception of man. The same unknowns arise concerning the diversity of the ecosystems that envelop the planet and never cease to amaze us with their insightful and mysterious compositions. In Iceland, many of these paradigms converge. The light of the solar constellation shines with such intensity during the summer, causing a strange phenomenon - for those of us who are not from there, of course - during which night disappears, and brightness spreads throughout the twenty-four hours of the day. Then, that same stream of brightness fades as autumn approaches and disappears entirely in winter, turning into eternal darkness that troubles the human soul.

When I read some perceptive journalistic observations this morning from various sources throughout the world. Among them, an essay published in Le Monde Diplomatique, entitled: —“The global South defies the West on Ukraine… Pursuing self-interest in a multipolar world, caught my attention as it presented a unique perspective on the ongoing conflict in Ukraine. The truth belongs to everyone; no media outlet should ever be judged for their views. The "your truth" or "my truth" concept is intriguing but ultimately flawed. As individuals, we are all seekers of truth and not possessors. It's crucial to remember that even if we don't fully comprehend the truth, we can still stand up for it or reject it.

That said, speaking of Ukraine, its history dates to the year 882 when Kievan Rus was established, a federation of several East Slavic tribes, with the territory of Ukraine in the centre. It soon became the largest and most powerful state in Europe. However, in 1256, it was invaded by the Mongols, meaning there is little knowledge about it today. After its disintegration from Kievan Rus, one of the principalities of Galicia-Volhynian became the Kingdom of Ruthenia. It joined Lithuania in 1349, forming the Grand Duchy of Lithuania, Ruthenian, and Austinian. This territory was incorporated into the Republic of the Two Nations two centuries later, which joined present-day Poland and Lithuania. In 1648, the Cossack Ukraine was formed after the Khmelnytskyi rebellion, lasting until the mid-eighteenth century, when it would disappear after years of progressive division. Most of the Ukrainian territory would remain within the Russian Empire created in 1721.

Also, the history of Ukraine can be analyzed through literature, and what better choice than the story of Anton Chekhov: “The Lady with the Dog", first published in 1899, it describes an adulterous affair between an unhappily married Moscow banker and a young married woman that begins while both are vacationing alone in Yalta. Or its political history with “The Yalta Conference” in the Russian resort town of Crimea from February 4-11, 1945. It was a meeting of the minds between U.S. President Franklin D. Roosevelt, British Prime Minister Winston Churchill, and Soviet Premier Joseph Stalin. They came together to create a new geopolitical order during World War Two. This conference played a crucial role in shaping the post-war world, and its far-reaching implications are still felt today. 

Without a doubt, every situation can be simple or difficult depending on your point of view. Who is more difficult to pin down than former US President Donald Trump. President Trump is currently the focus of multiple articles in the worldwide press since the Durham report severely condemns the FBI's 2016 Trump campaign investigation. However, before passing any judgments, it is imperative to consider everything.

We all have unique complexities that exist within us. These intricacies can be a mixture of fears, insecurities, frustrations, and anxieties we carry throughout life. As Confucius said, some individuals enjoy finding faults in others. These insecurities can be especially damaging when it comes from a loved one, such as a partner, mother, father, or even a politician. However, it's important to remember that politicians have been the same throughout history (BC or AC), no matter who's in power.

Humans have always been interested beings that seek explanations for the world's mysteries. The "Principle of Sufficient Reason " has greatly influenced our understanding of causality and how things happen. It suggests that everything that occurs must have a reason behind it and that it defines the outcome. This concept is fundamental in philosophy and has helped us develop a more rational and logical approach to understanding the world. By using this approach, we can examine events and phenomena more effectively and come up with logical explanations that satisfy our needs; regrettably, this hasn't always been the case.

If we apply the "Principle of Sufficient Reason," we could determine whether it had sufficient justification in the first case, which refers to Ukraine, to limit it to the following assertion:

— It is undeniable that stable and reliable power and fuel supply are crucial for the electric industry. We must not overlook this fact. However, we can be hopeful that politicians have learned from past mistakes. A prime example is Europe, which once relied on a single pipeline and a lone supplier, resulting in a tragic error.

—In the instance of former President Donald Trump, who has the well-deserved moniker "hard to kill, the antagonistic media, to the point of losing consciousness, have made the former head of state a victim with all the possibilities of being president again in 2024 as described in the article of the Spiegel: Horror Scenario Germany Prepares for Possible Re-Election of Donald Trump. Berlin is preparing for the possibility that Donald Trump could beat Joe Biden in the next election. That outcome would likely be a disaster for Ukraine, NATO, and the looming climate crisis. Diplomats have begun establishing contacts with the former president's camp to avoid being blindsided as they were in 2016.

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Most read…

Pursuing self-interest in a multipolar world

The global South defies the West on Ukraine

The US and the West claim Russia’s war on Ukraine is a clash between democracy and autocracy. Elsewhere, past US military interventions, and self-serving failures to act, produce different conclusions.

Le Monde Diplomatique by Alain Gresh

Durham report sharply criticizes FBI’s 2016 Trump campaign probe

Special counsel says “extremely troublesome” failures appear to stem from bias that kept agents from carefully examining evidence

WP By Devlin Barrett and Perry Stein, May 15, 2023 

China’s Demand for Oil Hits Record as IEA Raises Global Forecasts

Outlook highlights widening divide between booming demand in the developing world and lackluster requirements in Europe and North America

WSJ By Will Horner, May 16, 2023

French bank BNP to stop funding new gas projects

The move follows repeated criticisms from activists that the banking giant is falling short on climate protection.

Le Monde with AFP,  May 11, 2023

Macron’s calls for ‘regulatory pause’ in EU environmental laws wink at conservatives

He said that, compared to other nations, "we have already approved several environmental legislation at the European level."

POLITICO EU BY FEDERICA DI SARIO AND GIORGIO LEALI, MAY 12, 2023 

Vietnam approves plan to boost wind, LNG by 2030

According to government estimates, the plan will require $134.7 billion in capital for new power plants and grids, with some of that money likely to come from foreign investors.

By Khanh Vu and Francesco Guarascio

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Neutral country? Vladimir Putin in Saudi Arabia, October 2019
Mikhail Svetlov/Editing by Germán & Co

Pursuing self-interest in a multipolar world

The global South defies the West on Ukraine

The US and the West claim Russia’s war on Ukraine is a clash between democracy and autocracy. Elsewhere, past US military interventions, and self-serving failures to act, produce different conclusions.

Le Monde Diplomatique by Alain Gresh

Is the war in Ukraine a global ‘battle between democracy and autocracy’, as US president Joe Biden calls it, a view echoed by almost all Western commentators and politicians? No, says American journalist Robert D Kaplan, ‘however counter-intuitive that seems. After all, Ukraine itself for many years has been a weak, corrupt, institutionally underdeveloped basket case of a democracy.’ Reporters Without Borders ranked it 97th out of 180 in its 2021 World Press Freedom Index. ‘The fight,’ Kaplan continued, ‘is for something broader and more fundamental: the right of peoples the world over to determine their own futures and to be free from naked aggression’ (1). And he makes the obvious point that many dictatorships are US allies.

As positions become entrenched in wartime, dissenting voices on Ukraine are rarely heard in the richer North. But in the South, the so-called ‘rest of the world’ to which the majority of humanity belongs, people see this conflict quite differently. World Health Organisation president Tedros Adhanom Ghebreyesus lamented that the world does not give equal importance to Black and white lives, or to those of Yemenis and Tigrayans compared with Ukrainians: ‘Some are more equal than others’ (2). He drew the same conclusion during the Covid-19 crisis.

This is one of the reasons why many countries, especially in Africa, have abstained from UN resolutions on Ukraine — and not just dictatorships but also South Africa, Armenia, Mexico, Senegal, Brazil and India (3). A small number of non-Western countries have adopted sanctions on Russia.

As Trita Parsi (4), executive vice-president of the Washington-based Quincy Institute for Responsible Statecraft thinktank, pointed out in late March after the Doha Forum (a gathering of more than 2,000 international politicians, journalists and intellectuals), the countries of the South ‘largely sympathise with the plight of the Ukrainian people and view Russia as the aggressor. But Western demands that they make costly sacrifices by cutting off economic ties with Russia to uphold a “rules-based order” have begotten an allergic reaction. That order hasn’t been rules-based; instead, it has allowed the US to violate international law with impunity.’

Why Saudi Arabia backs ‘neutrality’

The stance of key US ally Saudi Arabia, which didn’t join the campaign against Russia and instead called for negotiations between the two parties, is emblematic. A series of factors has encouraged its ‘neutrality’. The creation of OPEC+ in 2020, which brought Russia into negotiations on oil production quotas, has resulted in fruitful cooperation between Moscow and the kingdom, which even sees the relationship as ‘strategic’ (5) — doubtless over-optimistically. Observers noted that in August 2021 Saudi deputy defence minister Prince Khalid bin Salman attended the Moscow arms fair and signed a military cooperation agreement complementing his country’s longstanding collaboration with Russia on civil nuclear development.

Today we are witnessing the beginning of a shift towards a multipolar system. The position of some countries on this war does not seek to defend the principles of freedom and democracy but their interests in maintaining the existing world order.

Al-Riyadh

More broadly, Russia has become a key interlocutor in all regional crises as the only power with ongoing relations with all participants, including those at odds, or even at war, with each other: Israel and Iran; the Houthis and the United Arab Emirates (UAE); Turkey and Kurdish groups.

At the same time, relations between Riyadh and Washington are deadlocked. The dominant view in Saudi Arabia is that the US is no longer a trustworthy ally, given its abandonment of Egypt’s president Hosni Mubarak in 2011, its abject withdrawal from Afghanistan, its willingness to negotiate the Iran nuclear deal without considering its regional allies’ reservations, and its silence in the face of Houthi drone attacks on Saudi oil installations, even when their friend Donald Trump was still president. And things have only got worse since the election of Joe Biden, who threatened to treat Saudi Arabia as a pariah following journalist Jamal Khashoggi’s murder in October 2018, for which US intelligence agencies blame the all-powerful Saudi crown prince, Muhammad bin Salman (MBS). Biden has also criticised the Saudis’ role in the war in Yemen.

These US positions brought no policy shift from the Democratic administration, except for Biden’s refusal to have any direct contact with MBS. This went down badly in Riyadh. When President Biden finally tried to contact MBS, specifically to ask the kingdom to increase oil production to offset the embargo against Russia, MBS refused to take his call, according to the Wall Street Journal  (6). Riyadh wonders why it was contacted last and its support taken for granted.

The Saudi press has been critical of the US too. As the influential Saudi daily Al-Riyadh said, ‘The old world order that emerged after the second world war was bipolar; then it became unipolar after the collapse of the Soviet Union. Today we are witnessing the beginning of a shift towards a multipolar system.’ And it added, pointedly, ‘The position of some countries on this war does not seek to defend the principles of freedom and democracy but their interests in maintaining the existing world order’ (7).

‘Last chance for US hegemony’

A similar position is widely shared in the Middle East, based on two sets of arguments. First, that Russia does not bear sole responsibility for the war, which is above all a confrontation between great powers for world hegemony, and that what is at stake is not respect for international law, and therefore it does not concern the Arab world. An op-ed in Al-Ahram, the unofficial daily of the Egyptian government (another US ally), described ‘a broader confrontation between the US and Western countries on one side and countries that reject their hegemony over the world on the other. The US seeks to recalibrate the world order after realising that — in its current form — it does not achieve its interests, but rather strengthens China at its expense. The US is terrified of the impending end of its dominion over the world, and it is aware that the current conflict in Ukraine is the last chance to preserve this position’ (8).

The Arab media’s other line of argument is that the West has double standards. Democracy and freedom? War crimes? Peoples’ right to self-determination? Is the US, which bombed Serbia and Libya, and invaded Afghanistan and Iraq, best qualified to defend international law? Hasn’t it also used cluster munitions, phosphorous bombs and depleted uranium projectiles? The US military’s crimes in Afghanistan and Iraq have been widely documented but never prosecuted. And, without denigrating the Ukrainians’ suffering, thus far the destruction inflicted on Afghanistan and Iraq far exceeds the current tragedy.

Should Vladimir Putin be brought before the International Criminal Court? Washington has yet to ratify its statute. One op-ed noted the ironic contrast between the 2003 Economist front cover of George W Bush post-Iraq invasion under the headline ‘Now, the waging of peace’ and its recent cover showing Putin in profile, with a tank for a brain, and the headline ‘Where will he stop?’ (9).

Palestine has been completely occupied for decades (whereas Ukraine has only been partially occupied for a few weeks) and remains an open wound in the Middle East. Yet it inspires no solidarity among Western governments, which continue to give Israel carte blanche. Mohammad Kreishan writes, ‘It is worth remembering the chants shouted at demonstrations, the angry declarations that, over years and decades, have begged for help for the Palestinian people, bombed in Gaza or living under the threat of incursions, murders, assassinations, land seizures and house demolitions in the West Bank, an area that all international resolutions regard as occupied territory’ (10).

President Zelensky’s appeal to the Knesset, drawing a parallel between his country’s situation and that of an Israel ‘threatened with destruction’, outraged many. But he didn’t get the expected support from Tel Aviv, which remains close to Moscow (11). And finally, the differential treatment given to white European refugees from Ukraine and those from the ‘rest of the world’ — brown, Black and mixed race — has caused bitterness in the Middle East and throughout the South.

It can be countered that this is nothing new: Arab opinion and media have always been anti-Western; ‘the Arab street’, as European and North American governments sometimes contemptuously call it, carries little weight. After all, in the first Gulf war (1990-91), Saudi Arabia, Egypt and Syria let themselves be drawn into the war alongside the US against the wishes of their people. However, in the case of Ukraine, these countries, even long-standing US allies, have distanced themselves from Washington — Saudi Arabia is not alone. On 28 February, a few days after the Russian invasion, UAE foreign minister Sheikh Abdullah bin Zayed Al-Nahyan met his Russian counterpart Sergey Lavrov in Moscow and welcomed the close ties between their countries. And Egypt did not respond to G7 ambassadors’ undiplomatic injunction to condemn the Russian invasion. Even Morocco, another faithful US ally, conveniently missed the 2 March UN General Assembly vote on Ukraine.

At the same time, the US, with tens of thousands of soldiers stationed in the Gulf, bases in Bahrain, Qatar and the UAE, and the Fifth Fleet on constant patrol, remains a major player in the region and it may be risky to ignore or even antagonise it. Especially since the various Arab countries — and the South more broadly — have not adopted their stance with the purpose of restructuring the world or mounting strategic opposition to the North — unlike the non-aligned movement in the 1960s and 70s, which allied with the socialist camp — but out of perceived self-interest. To paraphrase Palmerston, in the post-cold war era, states no longer have permanent friends or sponsors, they have fluctuating, faltering, time-limited allies. Will Russia’s setbacks and the sanctions imposed on it lead some of them to rethink their indulgence towards Moscow?

As old ideological divisions fade, and with Washington’s promises of a ‘new international order’ made after the first Gulf war (1990-91) abandoned in the Iraqi sand, a multipolar world is emerging amid the chaos. It offers greater room for manoeuvre to the ‘rest of the world’. But the flag of revolt against the West and its disorder does not (yet) constitute a roadmap for a world run according to international law rather than the rule of the strongest.

*Alain Gresh is a journalist and director of the online journals Orient XXI and Afrique XXI.

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Special counsel John Durham leaves federal court in Washington last year. (Manuel Balce Ceneta/AP)/Editing by Germán & Co

Durham report sharply criticizes FBI’s 2016 Trump campaign probe

Special counsel says “extremely troublesome” failures appear to stem from bias that kept agents from carefully examining evidence

WP By Devlin Barrett and Perry Stein, May 15, 2023 

Special counsel John Durham has issued a long-awaited report that sharply criticizes the FBI for investigating the 2016 Trump campaign based on “raw, unanalyzed, and uncorroborated intelligence” — a conclusion that may fuel rather than end partisan debate about politicization within the Justice Department and FBI.

Durham was tapped in 2019 by President Donald Trump’s attorney general, William P. Barr, to reexamine how government agents hunted for possible links between the Trump campaign and Russian efforts to interfere in the presidential election. The very appointment — of an investigator to reinvestigate the investigators — led to significant criticism from current and former law enforcement officials.

The report, coming almost four years to the day since Durham’s assignment began, will probably be derided by Democrats as the end of a partisan boondoggle. Republicans will have to wrestle with a much-touted investigation that has cost taxpayers more than $6.5 million and didn’t send a single person to jail, even though Trump once predicted that Durham would uncover the “crime of the century.”

On Monday, Trump nevertheless claimed victory, posting on social media that the report showed “the American Public was scammed, just as it is being scammed right now by those who don’t want to see GREATNESS for AMERICA!”

Much of the FBI conduct described by the Durham report was previously known and had been denounced in a 2019 report by the Justice Department’s inspector general, which did not find “documentary or testimonial evidence of intentional misconduct.”

Durham goes further in his criticism, however, arguing that the FBI rushed to investigate Trump in a case known as Crossfire Hurricane, even as it proceeded cautiously on allegations related to then-Democratic presidential candidate Hillary Clinton. In particular, the report notes that while the FBI warned Clinton’s team when agents learned of possible evidence by a foreign actor to garner influence with her, agents did not give a similar defensive briefing to the Trump campaign before quickly launching an investigation.

The FBI’s handling of key aspects of the case was “seriously deficient,” Durham wrote, causing the agency “severe reputational harm.” That failure could have been prevented if FBI employees hadn’t embraced “seriously flawed information” and instead followed their “own principles regarding objectivity and integrity,” the report said.

As examples of confirmation bias by the FBI, Durham cites: the FBI decision to go forward with the probe despite “a complete lack of information from the Intelligence Community that corroborated the hypothesis upon which the Crossfire Hurricane investigation was predicated”; agents ignoring information that exonerated key suspects in the case; and the FBI being unable to corroborate “a single substantive allegation” in a dossier of Trump allegations compiled by British former spy Christopher Steele.

Durham’s appointment as special counsel was unusual, in that Barr essentially tasked him with investigating the work done for a prior special counsel: Robert S. Mueller III. Durham’s probe produced paltry results in court: Two people that he charged with crimes were found not guilty, while a former FBI lawyer pleaded guilty to altering an email used to help a colleague prepare a court application for surveillance of a Trump adviser.

After the second acquittal last year, Democrats and some lawyers urged the Justice Department to shut down Durham’s office as a waste of taxpayer money and time.

The report issued Monday said Durham and his team conducted more than 48o interviews, reviewed more than 1 million documents, executed seven search warrants and, with a grand jury, served more than 190 subpoenas.

It ended with a short recommendation for the FBI: Create a position for an FBI agent or lawyer to provide oversight of politically sensitive investigations. That person would be tasked with challenging every step of such investigations, including whether officials appropriately adhered to the rules governing applications to the Foreign Intelligence Surveillance Court, which handles matters of national security.

After the inspector general’s 2019 report criticizing the FBI’s conduct, Director Christopher A. Wray implemented many changes at the agency, which has been at the center of fierce political debates since the 2016 election.

The senior FBI officials who ran the Crossfire Hurricane investigation left the agency years ago. But they have long said the bureau had a duty to investigate the allegations against the Trump campaign.

Durham sent his report to Attorney General Merrick Garland on Friday, and Garland sent it to top members of the Senate and House judiciary committees on Monday afternoon, a Justice Department official said. The report contains no classified information, and Garland told lawmakers he released the report with no “additions, redactions, or other modifications.” Garland did not submit to Congress a 29-page classified appendix but said he would arrange for members to view it.

In a statement responding to the report, the FBI said the conduct in 2016 and 2017 that Durham examined “was the reason that current FBI leadership already implemented dozens of corrective actions, which have now been in place for some time. Had those reforms been in place in 2016, the missteps identified in the report could have been prevented. This report reinforces the importance of ensuring the FBI continues to do its work with the rigor, objectivity, and professionalism the American people deserve and rightly expect.”

A longtime federal prosecutor who was U.S. attorney in Connecticut during the Trump administration, Durham had previously taken on politically sensitive investigations in Washington — including cases involving the CIA and the FBI. But the special counsel appointment was his highest profile and most politically charged undertaking.

When the inspector general, Michael Horowitz, issued his findings in 2019, Durham took the unusual step of publicly disagreeing with him on a key point — disputing Horowitz’s finding that the decision to open the investigation into Trump’s campaign was justified.

“Based on the evidence collected to date, and while our investigation is ongoing, last month we advised the Inspector General that we do not agree with some of the report’s conclusions as to predication and how the FBI case was opened,” Durham said at the time.

Yet on Monday, he appeared to back away from that criticism, writing “there is no question that the FBI had an affirmative obligation to closely examine” allegations brought to the agency by an Australian diplomat who told them of alarming statements made over drinks by a low-level Trump adviser, George Papadopoulos.

The status of key investigations involving Donald Trump

Durham’s report suggests he thinks the FBI should have opened a preliminary investigation, rather than a full investigation, based on the Australian’s tip. The report highlights a conversation between two FBI officials at the time who appeared to bemoan the weakness of the new case.

“Damn that’s thin,” wrote one FBI official in early August 2016. “I know,” replied another, “it sucks.”

Durham’s final report comes against a backdrop of two failed prosecutions. Igor Danchenko — a private researcher who was a primary source for a dossier of allegations about Trump’s alleged ties to Russia — was acquitted in October of lying to the FBI about where he got his information. Durham personally argued much of the government’s case in that trial, in federal court in Alexandria.

Last year, a jury in D.C. federal court acquitted cybersecurity lawyer Michael Sussmann, whom Durham also had charged with lying to the FBI. A former FBI lawyer, Kevin Clinesmith, was sentenced to one year of probation after admitting in a 2020 plea deal with Durham that he had altered a government email used to justify secret surveillance of a former Trump campaign adviser, Carter Page.

The report means Durham’s time as a special counsel is coming to an end, while two other special counsels continue: one to investigate Trump and people close to him for classified documents found at his home, as well as events leading up to the Jan. 6, 2021, riot at the U.S. Capitol, and another to investigate President Biden and people close to him for classified documents found at his home and office.

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Image by Germán & Co

China’s Demand for Oil Hits Record as IEA Raises Global Forecasts

Outlook highlights widening divide between booming demand in the developing world and lackluster requirements in Europe and North America

WSJ By Will Horner, May 16, 2023

China’s insatiable demand for oil is growing at a faster-than-expected pace, threatening to tighten crude markets and send oil prices higher as supplies struggle to keep up, the International Energy Agency said.

The Paris-based agency’s latest outlook points to a widening divide between booming demand for crude across the developing world and lackluster demand in Europe and North America where economic prospects look bleak.

It also highlights a growing disconnect between oil prices—which have tumbled to their lowest levels in around 16 months in recent weeks—and expectations that strong demand for oil and limited supplies will prompt a sharp deficit that many analysts expect to lift oil prices.

In its closely watched monthly oil market report, the IEA raised its forecast for global oil demand growth this year by 200,000 barrels a day, to 2.2 million barrels a day. It said total demand would stand at 102 million barrels a day, 100,000 barrels a day more than it forecast last month.

China’s share of that increase, already expected to be large, appeared to be growing and “continues to surpass expectations,” the IEA said. The nation’s crude demand hit a record 16 million barrels a day in March while China will account for 60% of all oil demand growth this year, the IEA said.

While demand is set to boom in China and across the developing world, high interest rates and lingering inflation in developed nations are keeping demand for oil there in check. Efforts by Western governments to encourage a shift away from polluting fossil fuels are further heightening that gap as developing economies continue to see oil and coal as more affordable fuel sources.

Oil demand in the developed nations that make up the Organization for Economic Cooperation and Development will grow by just 350,000 barrels a day this year, the IEA said—around 16% of the total expected oil demand growth. The rest, around 1.9 million barrels a day, will come from non-OECD nations, primarily in Asia.

As oil demand grows this year, the IEA expects the oil market to slip into a large deficit as oil producers struggle to keep pace. Demand is expected to exceed supply in the current quarter for the first time since early 2022, with that gap growing to around 2 million barrels a day by the end of the year.

China will account for 60% of all oil demand growth this year, the IEA said. PHOTO: CFOTO/ZUMA PRESS

For 2023, global supplies are expected to average 101.1 million barrels a day, 1.2 million barrels a day more than in 2022.

Recent steps by major oil producers have only added to that growing gap. A plan by some of the largest members of the Organization of the Petroleum Exporting Countries to cut production by more than a million barrels a day began this month. Meanwhile, oil producers in the U.S. have been reluctant to invest money in new production.

Those OPEC cuts could see output from the group and its allied producers—known collectively as OPEC+—fall by 850,000 barrels a day between April and the end of the year, the IEA expects. Meanwhile, output from non-OPEC+ nations is expected to rise by 710,000 barrels a day in that time.

Despite the IEA’s forecasts for a tightening oil market, crude prices have remained subdued, offering some relief to economies and consumers struggling with high inflation. Concerns about the health of the U.S. banking system have been the latest issue to dog the outlook for global economic growth and weigh on crude prices.

Meanwhile, supplies from Russia have remained stronger than expected, helping to further depress prices. Russian oil exports hit 8.3 million barrels a day in April, their highest level since the invasion of Ukraine in February 2022, as Moscow doesn’t appear to have fully followed through on a plan to slash output by 500,000 barrels a day, the IEA said.

Brent crude oil, the international oil benchmark, hit its lowest level since December 2021 this month. It ticked up 0.6% to $75.71 a barrel on Tuesday, following the release of the IEA report.

The forecast of strong Chinese demand and a growing deficit from the IEA—and from other major energy forecasters such as the Energy Information Administration and OPEC—is why many analysts are expecting oil prices will rebound this year.

“The current market pessimism…stands in stark contrast to the tighter market balances we anticipate in the second half of the year,” the IEA said.

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Extinction Rebellion France activists hold a pipeline replica after spraying paint on a BNP Paribas bank building during a protest against TotalEnergies and the East African Crude Oil Pipeline project, in Paris, France, on January 20, 2023. The slogan reads "The bank of a dying world." SARAH MEYSSONNIER/REUTERS

French bank BNP to stop funding new gas projects

The move follows repeated criticisms from activists that the banking giant is falling short on climate protection.

Le Monde with AFP,  May 11, 2023

French banking giant BNP Paribas said on Thursday, May 11, that it would stop financing new natural gas field projects following repeated criticisms from activists that it is falling short on climate protection.

Although the policy change is a break from the past, when BNP had pumped cash into gas projects, the group did not rule out continuing to finance firms doing such work as long as its money does not go directly to fossil development.

The bank also made official Thursday that it is "no longer providing any financing dedicated to the development of new oil fields" − although it said in January that it has made no such investments since 2016.

Similarly to gas, BNP will not withhold money from firms opening up new oil fields as long as its cash is not directly used for that purpose.

But as part of a longer-term plan stretching to 2030, the bank is "phasing out financing to non-diversified oil exploration and production" companies.

The steps contribute to BNP's wider aim to reduce its investments in oil exploration and production by 80% by the end of the decade.

With an eye on 2050 net zero targets from the International Energy Agency, the bank announced new objectives for its investment in steel, aluminum and cement production.

BNP aims to reduce so-called intensity of emissions − the amount of carbon dioxide emitted to create each tonne of the final product − by 25% for steel, 10% for aluminum and 24% for cement by 2030, compared with 2022 levels, or 2021 for cement.

The bank said it was "on track" for similar reductions announced last year for oil and gas, power generation and the car industry.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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French President Emmanuel Macron | Pooled photo by Ludovic Marin/AFP/Editing by Germán & Co

Macron’s calls for ‘regulatory pause’ in EU environmental laws wink at conservatives

He said that, compared to other nations, "we have already approved several environmental legislation at the European level."

POLITICO EU BY FEDERICA DI SARIO AND GIORGIO LEALI, MAY 12, 2023 

BRUSSELS/PARIS — It’s been months that EU centre-right lawmakers have been championing a backlash against environmental regulation, arguing it’s at odds with other — more strategic — EU objectives.

Now, a senior voice is adding to the chorus of those asking for a freeze. 

During a speech on how to revive the French industry on Thursday at the Elysée, President Emmanuel Macron called for “a European regulatory break.” 

“We have already passed lots of environmental regulations at European level, more than other countries,” he said. “Now we should be implementing them, not making new changes in the rules or we are going to loose all our [industrial] players.”

He insisted that, when it comes to the regulatory side, the EU is “ahead of the Americans, the Chinese and of any other power in the world.”

"We must not make new changes to the rules," he added, warning that an unstable regulatory environment would only cause harm to investments. 

Macron’s calls for putting a break on a new stream of laws aiming at reversing environmental damage look oddly in line with the arguments that emerged at last week’s gathering of the European People’s Party (EPP),, where senior MEPs gathered in Munich took a hard stance against new rules on pesticides and nature restoration. Moving ahead with them, they claimed, meant endangering the EU’s long-term food security.

In an interview with POLITICO, German MEP Christian Ehler, who leads the Parliament’s work on the Net-Zero Industry Act, which aims at boosting the bloc's manufacturing capacity of clean energy technologies, repeatedly cautioned against a fast-tracked phaseout of per- and polyfluorinated substances (PFAS) — harmful chemicals that linger in the environment. He was clear that, with no easy way to replace them, a speedy ban could end up delaying the continent’s green industry ambitions. 

That’s a position that EPP’s main political rivals — the Socialists and Democrats (S&D) — slam as disingenuous. 

“That being pro-industry or pro-farmers means that you cannot protect climate, environment and biodiversity at the same time [is] a myth,” said Mohammed Chahim, S&D vice chair. He stressed that hitting pause on environmental laws until next years’ elections would only result in a “year thrown away” in the fight against climate change. 

Elysée’s officials were quick to make clear that Macron was not attacking any existing or upcoming EU environmental text.

“He never talked about a moratorium or repeal of rules that already exist or are under negotiation,” stressed an Elysée official, noting that Macron’s point was mainly about implementing existing rules before adding new ones. 

His comments sparked immediate criticism not only from the opposition but even from his more climate-friendly allies.

"Any speech that gives the feeling that we have done enough and that it is sufficient is a dangerous speech in the phase that is starting," said Barbara Pompili, a former French environment minister with Macron, currently an MP. “You should never send slow-down messages,” she warned.

French MEP Pascal Canfin from Macron’s Renew Europe Group told Le Monde that Macron made an “unfortunate” [malheureux] comment, as it could have caused misunderstanding, while stressing that, unlike the EPP,  Macron was not calling for freezing environmental texts that are under discussion in Brussels. 

Centre-right politicians immediately stressed that they have been the first ones calling for less rules and to argue that Macron’s comments are in contradiction with its green policies.

“For months, we the EPP have been demanding a legislative moratorium to put an end to the excess of standards that hits all those who produce and work in Europe,” Francois-Xavier Bellamy, a French MEP for the EPP, said in a written statement, arguing that “the Macronist elected representatives, on the other hand, are pushing with the left and the Greens for the most restrictive regulations.”

The fact that Macron’s comments sparked mixed reactions and fuelled misunderstanding is no surprise for Thomas Pellerin-Carlin, an energy expert and director at the Institute for Climate Economics (I4CE) in Paris. Macron is not new to using catchy expressions — such as the ones on not being “America’s followers” or on NATO’s brain death — which “agitate the media.”

“If Macron is suggesting to first focus on implementing the existing EU green rules and those that are being adopted in this mandate, then that's also what the European Commission is saying," he noted, adding that the use of the term "regulatory pause" was "maybe a bit clumsy, given its meaning in the EU context."

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Power-generating windmill turbines are pictured at a wind park in Bac Lieu province, Vietnam, July 8, 2017. REUTERS/Kham/File Photo/Editing by Germán & Co

Vietnam approves plan to boost wind, LNG by 2030

According to government estimates, the plan will require $134.7 billion in capital for new power plants and grids, with some of that money likely to come from foreign investors.

By Khanh Vu and Francesco Guarascio

HANOI, May 16 (Reuters) - Vietnam said on Tuesday it has approved a long-awaited power plan for this decade, in a move meant to boost wind energy and gas, while reducing reliance on coal.

Known as PDP8, the plan aims to ensuring energy security for the Southeast Asian country while it begins the transition to becoming carbon-neutral by mid-century.

The plan needs $134.7 billion of funding for new power plants and grids, the government estimated, with part of the money expected to come from foreign investors.In December, the Group of Seven (G7) nations and other wealthier countries pledged $15.5 billion in initial funds to support Vietnam's transition away from coal.

Amid internal squabbles and work on complex reforms, the plan had been delayed for more than two years. It has seen a dozen of draft versions before being approved by Prime Minister Pham Minh Chinh, and now needs approval from the rubber-stamp parliament, possibly this month, before its final adoption.

A diplomat from the G7 donors' group, who declined to be identified as he not authorised to speak to media, said on Tuesday the approval was an important step and necessary to unlock funding for renewable projects, especially offshore wind. It was, however, not completely in line with G7 goals, the diplomat added, as Vietnam will still be heavily reliant on coal this decade.

To complete its planned transition to carbon-neutrality with total phase-out of coal by 2050, the government estimates it needs up to $658 billion, of which one-fifth would have to be disbursed this decade.

The plan would more than double Vietnam's power generation capacity to more than 150 GW by 2030 from 69 GW at the end of 2020.

Reuters Graphics

GAS, WIND AND COAL

Power plants using domestic gas and imported liquefied natural gas (LNG) are set to become a crucial source of power by 2030, with a combined installed capacity of 37.33 GW, or 24.8% of the total, with LNG accounting for the lion's share, according to a government document seen by Reuters and not yet published.

That is a fourfold increase from 2020, when the country produced just about 9 GW of natural gas from fields in the South China Sea. It is not importing any LNG at the moment.

Wind, solar and other renewable sources, excluding hydropower, are set to cover at least nearly 31% of the country's energy needs by 2030, the government said, from about 25% in 2020. Their contribution could raise to 47% if G7 pledges are fully implemented, the document said.

Wind will account for 18.5% of the total power mix, most of it onshore, whereas the contribution from solar energy would fall nearly threefold to 8.5%.

Offshore wind power capacity, which is of particular interest to foreign investors, is expected to reach six GW by the end of this decade from zero now and at least 70 GW by 2050. The plan slightly revised down the initial target of seven GW by 2030, as Reuters reported earlier in May.

But it is unclear how fast new projects could be launched, as the country may still need to approve new legislation on the use of marine space.

In the energy mix by 2030, hydropower would account for 19.5%, down from over 30% in 2020.

Coal would remain a crucial energy source, accounting for 20% of the mix by 2030, but down from nearly 31% in 2020. However, because of the expected jump in total output, energy generated from coal would increase to more than 30 GW by the end of the decade, from 21 GW in 2020.

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Why Some Countries Find It Hard to Move Away From Fossil Fuels (NYT)

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Trinidad and Tobago is the No. 2 exporter of liquefied natural gas in the Americas. Its output has been falling, but it remains committed to fossil fuels.

Yara Trinidad, which makes ammonia and other chemicals in Trinidad and Tobago, is exploring alternatives to natural gas.Credit...Tony Cenicola/The New York Times

NYT By Clifford Krauss, May 15, 2023

*Clifford Krauss, who has covered the energy industry for more than a decade, spent 10 days reporting in Trinidad and Tobago.

Ribboned shovel in hand, Prime Minister Keith Rowley joined a ceremonial groundbreaking last month to celebrate Trinidad and Tobago’s first large solar farm project expected to generate power for 42,000 homes.

But if anyone thought the project symbolized the twilight of the island nation’s long embrace of fossil fuels, Mr. Rowley set them straight.

“We will continue to extract the hydrocarbons available to us as long as there is an international market,” Mr. Rowley said, as BP and Shell executives looked on. “If we are going to sell the last barrel of oil or the last molecule of gas, so be it.”

Trinidad and Tobago is known for its white sandy beaches, mountainous rainforests and steel pan drums. But its economy depends on oil and natural gas, not tourism.

It is one of the largest producers of fossil fuels in the Western Hemisphere, and more than a century of drilling has left its mark. The major highways on the main island are clogged by traffic and lined with industrial warehouses. Oil is stitched in the culture, a theme in many calypso songs. Even the steel pan drums originated from the lids of used oil barrels.

If Trinidad seems to be zigging and zagging on climate change policy, it is hardly the only one. Saudi Arabia, the United Arab Emirates and the United States are also building large solar farms while exploring for new oil gushers. Developing nations with fossil fuel riches — a group that includes Guyana, Nigeria and Namibia as well as Trinidad — say they cannot easily leapfrog to renewable energy because they lack capital and because their poor rely on cheap power and oil revenues for social programs.

President Biden and European leaders have no easy response. Industrialized countries are still producers and users of fossil fuels and have failed to put up the $100 billion a year they had pledged to a green fund for poor nations starting in 2020.

“The countries in the south are telling the countries in the north, ‘You are the ones who caused the climate issue, so why don’t you move first since you have the capital and technologies to advance renewables?’” said Anthony Paul, a former official in Trinidad’s energy ministry who has consulted with governments and companies in several African countries.

The Atlantic LNG export terminal is filling up shipping tankers less frequently than a few years ago because of declining natural gas production.Credit...Tony Cenicola/The New York Times

Trinidad has a population of just 1.5 million people, but it has long punched above its weight in energy. As the second largest exporter of liquefied natural gas in the Western Hemisphere after the United States, it has one of the highest per capita incomes in the Caribbean. It is also a leading producer of petrochemicals like ammonia and methanol.

But with its oil and gas fields aging, oil production has fallen to 58,000 barrels a day, from 230,000 barrels a day at its peak in 1978. The country’s only oil refinery was shut four years ago. Gas production has declined 40 percent since 2010, forcing the country to close one of its four export terminals for liquefied natural gas and three of its 18 petrochemical plants.

At the same time, the country is feeling the effects of a changing climate, with wetter rainy seasons and dryer dry seasons reducing farm yields and stormier seas punishing fishermen and flooding coastal roads and homes.

“We’re facing a huge decision, whether to pivot to a new direction,” said Ryun Singh, president of the Trinidad and Tobago Association of Energy Engineers. “If we don’t get it right, we face economic ruin.”

For now, Mr. Rowley’s government wants to double down on fossil fuels by trying to get energy companies to develop new offshore fields.

The oil and gas business “is the basis for our middle class,” said Ainka Granderson, an environmental scientist at the Caribbean Natural Resources Institute, a research organization in San Juan, a city on the main island. “Oil and gas was once the nation’s spine, but it’s now the crutch that props us up.”

That crutch is becoming increasingly rickety.

On a recent April afternoon, a tanker ship arrived at the Atlantic LNG terminal at Point Fortin to pick up a load of deep-chilled gas for Britain. “Trinidad to the rescue,” said a smiling Jean Andre Celestain, the plant’s chief operating officer.

But because the country’s gas production has been declining, the plant fills just one tanker every 66 hours these days, down from one every 48 hours four years ago.

“There is an urgency to get gas supply,” said Ronald Adams, Atlantic LNG’s chief executive.

Oil companies have found some new small fields, but analysts still expect production to decline over the next few years.

Because of declining energy export earnings, the nation’s gross domestic product dropped by 20 percent from 2015 to 2021. The jump in oil and gas prices after Russia’s invasion of Ukraine and a new gas discovery by Shell have led to a small rebound over the past year.

But that is not enough to stem the decline in energy production and revenues, energy experts say.

In an effort to compensate for the shortfall, the country is seeking to reduce domestic use of natural gas so more can be exported. That is the main mission of the solar farms being built on Trinidad by BP and Shell. To drive down domestic demand for gas, energy regulators are proposing to raise electricity rates for residents and businesses. That proposal faces stiff political opposition.

“When you are an oil-and-gas-producing nation, you are always behind in renewables because people enjoy the cheaper rates of electricity that come with fossil fuels,” said David Alexander, a professor of petroleum engineering at the University of Trinidad and Tobago.

Dr. Alexander and another professor are leading an effort to map a “carbon-capture atlas” of depleted oil and gas fields that can be used to store carbon captured from Trinidadian petrochemical plants to help the country offset most or all of its greenhouse gas emissions.

There are other plans to try to turn Trinidad and Tobago away from gas and oil. Some entrepreneurs said the country should become a major exporter of products made from renewable energy like hydrogen, fertilizers and clean shipping fuel.

A homegrown energy company, Kenesjay Green, is working to produce hydrogen in the Point Lisas petrochemical complex. The company plans to use renewable energy and waste heat from power plants to split hydrogen from water. “Trinidad is uniquely poised to take off in the energy transition dramatically,” said Philip Julien, chairman of Kenesjay. “There’s huge potential and a lot of work to be done.”

Kenesjay is working with Yara Trinidad, an ammonia producer, to reduce its greenhouse gas emissions by replacing gas with water in its production process. Yara Trinidad hopes that it can eventually reopen one of the three ammonia plants it mothballed because of a lack of gas supplies.

Although the government supports these efforts, its focus remains on natural gas. “Gas is going to be around for decades, all right?” Stuart Young, Trinidad and Tobago’s energy minister, said in an interview.

BP and Shell plan to build two large solar farms, one at this site, that they expect to eventually provide up to 10 percent of Trinidad and Tobago’s electricity, freeing up more natural gas for export.Credit...Tony Cenicola/The New York Times

To increase gas production and exports, the country is pinning its hopes on new offshore fields. One, the Manatee field adjacent to the maritime border with Venezuela, is being developed by Shell.

Just over the maritime border, there is a medium-size shallow-water field called Dragon. Trinidad and Venezuela have been negotiating for five years about how to produce and export the Dragon gas. Shell would operate the field, and a pipeline could connect the field to Trinidad and Tobago’s export terminals in three to four years.

But first, Trinidad must reach a deal with the Biden administration and the Venezuelan government that would allow Trinidad to export natural gas from the Dragon field in Venezuela without violating U.S. sanctions.

The Biden administration granted a two-year license to the Trinidadian government to do business with Venezuela in January, but only if the government of President Nicolás Maduro of Venezuela did not receive cash payments. Trinidad and Tobago has offered to pay for the gas in food and medicine, but Mr. Maduro has rejected that offer.

Another potential prospect is the Calypso field, off the coast of the island of Tobago, which could be the nation’s first deepwater gas field.

Woodside Energy, an Australian company, is developing Calypso with BP. But Calypso’s geology is complicated. The field is made up of unconnected pockets of gas, meaning that multiple wells would be needed, making drilling more expensive.

“We’re working through the concepts and trying to figure out how do we get something that will work for everybody,” said Meg O’Neill, chief executive of Woodside.

Analysts said Trinidad needed to move fast or risk losing gas customers to other exporters, like the United States and Qatar, that are building newer and more efficient liquefied natural gas terminals.

That might be a tall order, and even some Trinidadians who have long worked in oil and gas worry that little can be done to halt their industry’s decline.

Ronnie Beharry worked in various field positions before becoming a manager at a gas field operated by Touchstone Exploration. He has only a high school education but can afford to send his eldest daughter to college.

“I tell them to look at other options because we’ve started to go green,” he said, referring to his three children. “I don’t know where things are headed. Sometimes I think the country has a backup plan, and sometimes I don’t.”

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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News round-up, May 15, 2023

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Quote of the day…

…”It will take a huge effort for us to support the energy transition to carbon-free sources like nuclear energy. In fact, according to historian Richard Rhodes, it could take from 50 to 100 years on average. That's why it's crucial to invest in all types of renewable energy, explore carbon capture for petroleum, and continue scientific research into fusion and advanced nuclear technology. Additionally, we should prioritize the immediate expansion of fission energy (is a remarkable process through nuclear reactions, generating an amazing quantity of power—far more than is possible from conventional sources), a proven and already-existing technology both in the U.S. and worldwide. There's no better time than now to make nuclear energy expansion a bipartisan priority.

TIME BY CHARLES OPPENHEIMER, MAY 11, 2023 

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Most read…

Nuclear Energy's Moment Has Come

In a new documentary released last week and available on VOD, director Oliver Stone's "Nuclear Now," we can see a comprehensive and compelling history of the rise of the anti-nuclear movement and a thoughtful argument for the utility of nuclear energy to address today's severe energy crises.

TIME BY CHARLES OPPENHEIMER, MAY 11, 2023 

Energy Stocks Are in the Doldrums After Last Year’s Big Rally

Worries about economy and demand weigh on oil and gas prices

WSJ By Hannah Miao, TODAY 

Investors Are Nervous—and That Could Support Stocks

Fund managers have lowest exposure to stocks relative to bonds since 2009

WSJ By Jack Pitcher, May 14, 2023

World’s most important election…

Erdoğan and Kılıçdaroğlu square up for likely 2nd-round clash in Turkey

Neither the president nor his rival looks set to pass the 50 percent threshold needed for an outright win.

POLITICO EU BY CHRISTIAN OLIVER AND ELÇIN POYRAZLAR, MAY 14, 2023 

Exclusive: G7 leaders to target Russian energy, trade in new sanctions steps

Western allies hunt for new ways to tighten already restrictive sanctions on Russia, from export controls to visa restrictions and an oil price cap, which has put pressure on Russian President Vladimir Putin but not halted the full-scale invasion that started over a year ago.

REUTERS By Trevor Hunnicutt and Andreas Rinke, NOW

Wagner head offered to reveal Russian troop locations to Ukraine - Washington Post

Prigozhin, a close ally of Russian President Vladimir Putin, has publicly threatened to withdraw his mercenaries from the area around Bakhmut due to a severe lack of ammunition. These actions could severely affect the ongoing Russian offensive in the region.

Reuters, editing by Germán & Co

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Diablo Canyon nuclear power plant owned by PG&E is scheduled to close in 2024 and 2025, but an effort is underway to extend the life of the plant. David Middlemamp-San Luis Obispo Tribune/Tribune News Service/Editing by Germán & Co

Nuclear Energy's Moment Has Come

In a new documentary released last week and available on VOD, director Oliver Stone's "Nuclear Now," we can see a comprehensive and compelling history of the rise of the anti-nuclear movement and a thoughtful argument for the utility of nuclear energy to address today's severe energy crises.

TIME BY CHARLES OPPENHEIMER, Editing by Germán & com, MAY 11, 2023 

*Oppenheimer is an entrepreneur and investor, representing the family of J. Robert Oppenheimer. You can follow his work at https://oppenheimerproject.org or on Twitter @choppen5.

For all the recent talk about clean energy and a shift away from coal, there’s a major problem in our goal to transition to a net zero-carbon economy. Despite all the growth and advances in renewable energy, globally we consume more fossil fuels than ever, and our rate of CO2 production is in fact increasing, not heading to zero.

But there’s a bipartisan, environmentally friendly solution still sitting on the table, still waiting for its moment — if only we can overcome our predetermined bias.

As J. Robert Oppenheimer’s grandson, I believe that my grandfather would support the expansion of nuclear energy as an environmentally friendly solution to address both the world’s energy problems and, perhaps counterintuitively, as a catalyst for peace and unity.

Most known as the physicist in charge of the Manhattan Project’s Los Alamos Laboratory during WWII, JRO (as we refer to him in the family) and many other prominent scientists noted that humanity reached a new milestone following the detonation of the first atomic bomb.In witnessing a technology sufficiently powerful to destroy humanity, they also recognized its potential for collective good — that it required a new level of unity to address common threats. JRO and others recommended that the only safe path forward was global scientific cooperation, especially in an effort to avoid international arms races. That level of cooperation is necessary to face today’s threats from exponential technological growth.

Indeed, nuclear energy has the ability to be scaled at an industrial level, globally: Uranium 235 has millions more times energy than coal or oil.

It’s also important to underscore that nuclear energy became unpopular in part due to its association with nuclear weapons and fears about its safety. But the actual safety record shows it is one of the safest sources of energy, and it is becoming more popular to be an environmentalist and pro-nuclear. We must get over our cognitive and political bias: Nuclear energy is necessary and safe, and not the same as nuclear weapons.

In a new documentary released last week and available on VOD starting June 6 from director Oliver Stone, “Nuclear Now,” we see a comprehensive and compelling history of the rise of the anti-nuclear movement, and a thoughtful argument for the utility in nuclear energy to address today’s severe energy crises. “Nuclear Now” also shows us that energy expansion is becoming a unifying issue, domestically and abroad. Today, we must expand the development of nuclear energy to meet our carbon-free energy transition, because nuclear energy is indeed environmentally friendly, and necessary. 

The support for nuclear energy has risen to 60 percent across the country — practically unheard of in modern political terms — including a spike among Democrats support from roughly 38 percent in 2018 to 59 percent today. Despite the decades of ringing alarm bells over the perceived dangers that nuclear energy might bring—in part of course due to its association with nuclear weapons—our energy crisis is too urgent to ignore nuclear anymore. And more than that, it’s equally important to dispel the misinformation surrounding it.

With rising bipartisan support, it can only go up from here.

It will take a huge effort for us to support the energy transition to carbon-free sources like nuclear energy, a process the historian Richard Rhodes has said takes 50 to 100 years on average. That should include all types of renewables, carbon capture for petroleum, and scientific research into fusion and advanced nuclear. And there should be an immediate expansion in fission energy, a proven, already-existing technology both in the U.S. and worldwide. There is a great opportunity right now to pursue nuclear energy expansion as a bipartisan issue.

As my family observes my grandfather’s birthday, it’s time to call for a “Manhattan Project” for carbon-free energy production. For as much doom and gloom the climate change narrative brings, we can also focus on what can be done to plan for a more sustainable future. Chief among them is an industrial-scale production of carbon-free nuclear energy. We’ve done it for defense, we can do it for energy.

Internationally there is great hope for nuclear energy development increasing cooperation that my grandfather, Neils Bohr, Einstein, and other scientists said was our path to a safe future. They recognized that there was only one way humans could survive when we possessed technology as powerful as atomic bombs: and that is to cooperate on a shared, safer, cleaner future.

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Image by Germán & Co

Energy Stocks Are in the Doldrums After Last Year’s Big Rally

Worries about economy and demand weigh on oil and gas prices

WSJ By Hannah Miao, TODAY 

Shares of oil-and-gas companies led the market last year. This year, they are the biggest laggards.

Energy stocks comprise the worst-performing sector of the S&P 500 this year, down 10%, compared with the broad index’s 7.6% gain. Shares of Chevron are down 13% this year, while Exxon Mobil has shed 4.1%. Warren Buffett’s darling, Occidental Petroleum, has pulled back 8%.

That comes after the S&P 500 energy sector rallied 59% in 2022, the only segment of the index to end the year with gains and the sector’s best year on record according to FactSet data going back to 1990. Russia’s invasion of Ukraine last year shocked energy markets, sending commodity prices soaring alongside energy stocks. 

This year concerns about a slowing global economy and energy demand have weighed on oil and gas prices, taking shares of energy companies down with them. Brent crude, the global oil benchmark, has dropped 13% this year, falling to $74.98 a barrel.

“The performance of an energy stock is going to be driven by supply and demand of oil,” said Fernando Soto, a senior vice president in Brown Brothers Harriman’s private banking division. “It’s very, very difficult to predict that.”

Mr. Soto said being underweight in energy shares hurt in the past couple of years, but is helping drive outperformance this year.

On the supply side, Russian oil production has continued to flow, testing Western sanctions. On the demand side, tumult in the U.S. banking sector has heightened concern about a slowdown in the world’s largest economy. Meanwhile, options-hedging has turbocharged volatility in oil prices.

Adding to the unpredictability regarding energy demand is the state of China’s reopening after the pandemic. Trade data released this week signaled the world’s second-largest economy is revving up slower than expected.

“It’s a challenging time for any sector at this particular point in time with all of the near- term uncertainty,” said Leslie Thompson, chief investment officer of Spectrum Wealth Management. “In the last couple of years energy has outperformed significantly, so I think there’s a little bit of reversion to the mean and taking some profits.”

Investors are shunning mutual funds and exchange-traded funds tracking energy stocks. They have pulled more than $7 billion out of energy-equity funds in 2023 on a net basis, according to Refinitiv Lipper fund-flows data as of Wednesday.

Still, some investors believe oil prices and energy stocks could stabilize as fears of a global slowdown abate. Supply remains tight; U.S. oil-and-gas companies have given priority to returning profit to shareholders over expanding production capacity.

Energy stocks only make up roughly 5% of weighting in the S&P 500, according to S&P Dow Jones Indices, but have an outsize impact on profits within the index. Companies in the S&P 500 are set to log a 2.5% annualized decrease in profit in the first quarter, according to FactSet, based on a blend of actual results and estimates for companies yet to report. Without the energy sector, the S&P 500 blended earnings decline would deepen to 3.8%.

The earnings power of energy companies make the sector look relatively cheap from a valuation standpoint. Companies in the S&P 500 energy sector are trading at roughly 10 times projected earnings over the next 12 months, according to FactSet. That compares with the broad index’s multiple of around 18.

Ben Cook, Hennessy Funds’ energy-transition fund portfolio manager, said the fund has remained more heavily weighted in oil-and-gas companies relative to renewable-energy shares, estimating that the oil market could begin to recover in the second half of the year.

“Oil price volatility is inescapable as an investment driver of performance and it’s certainly something that needs to be watched, but we feel there’s an opportunity to attract investor capital into the sector over time, given the strength in earnings,” said Mr. Cook.

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EMIL LENDOF/THE WALL STREET JOURNAL/Editing by Germán & Co

Investors Are Nervous—and That Could Support Stocks

Fund managers have lowest exposure to stocks relative to bonds since 2009

WSJ By Jack Pitcher, May 14, 2023

Investors have a sour outlook on U.S. stocks. Contrarians say that is good news for the market. 

Turmoil in the banking sector has dragged fund managers’ enthusiasm for stocks to a 2023 ebb, according to Bank of America’s most recent monthly survey. The stress adds to worries including lingering inflation, higher interest rates and a slowing economy that have driven them to cut their stockholdings to their lowest levels relative to bonds since 2009. 

Institutions have pulled a net $333.9 billion from stocks over the past 12 months, according to S&P Global Market Intelligence data, while individual investors have yanked another $28 billion. Billions have flowed into cash equivalents, driving total assets in money markets to a record $5.3 trillion as of May 10, according to the Investment Company Institute. 

To some, all that doom and gloom looks like a sign of hope. Many on Wall Street view extremes in sentiment one way or the other as the time to do the opposite. Warren Buffett famously advised investors to “be greedy when others are fearful.” 

The S&P 500 slipped 0.3% this past week and has made little progress since the end of March, stalling after a strong start to the year for highflying tech companies that has left the index up 7.4% for the year. This week, investors will get a fresh look at the health of the economy with the release of April retail-sales data and earnings reports from retailers Walmart, Home Depot and Target.

“The technicals and the sentiment side of the equation to us are just way offsides,” said Jack Janasiewicz, lead portfolio strategist at Natixis Investment Managers, a $1.2 trillion asset manager. “Not only does that limit the downside, but if you get any more positive news, that could easily squeeze the market higher.” 

Cautious stock picking hasn’t offered much advantage in the market turmoil so far, and the longer that managers lag behind, the more pressure they will be under to add risk back into portfolios, Mr. Janasiewicz said. Active fund managers have largely underperformed the S&P 500 this year, with only one in three actively managed large-cap mutual funds beating their benchmarks in the first quarter. 

Individual investors share institutions’ bearish view, according to the long-running weekly survey from the American Association of Individual Investors. The survey showed 41% of individual investors expect stock prices will fall over the next six months, down from a recent high of 61% in September that preceded this year’s rebound but above the 31% historical average. The survey is commonly used as a contrarian tool, with investors expecting higher returns following extreme levels of bearishness and lower returns when sentiment is particularly upbeat.

Nancy Tengler, chief investment officer of Laffer Tengler Investments, said her firm has added more new equity positions than normal in recent weeks as indexes stalled and attitudes soured. After the firm trimmed winning trades earlier this year and ran its cash allocation to a mid-single-digit percentage—higher than normal—it has been looking for bouts of volatility to put money back into stocks. 

“You’ve got all this money on the sidelines,” said Ms. Tengler. “In our view, when bearishness is that universal, it’s historically always been a great time to look for opportunities.”

Analysts at UBS Global Wealth Management have for weeks warned that stock valuations look high and markets are betting on a too-rosy outcome for the economy. That very caution may help put a floor under any fresh market drop, said Mark Haefele, chief investment officer at the bank’s wealth-management arm.

One potential catalyst for a rebound: investors front-running the Federal Reserve. After announcing another quarter-point interest-rate increase at the Fed’s May policy meeting, Chair Jerome Powell signaled that the central bank may be done raising the policy rate for now. Traders in interest-rate futures are betting that the Fed will begin cutting rates as soon as this fall. 

That could prompt traders to pile in ahead of any potential rate cuts, he said. Rate cuts are typically viewed as a boost to stocks, which start to look comparatively more attractive than bonds. 

“Positioning data suggests there’s a lot of money waiting to be put back into equities,” said Mr. Haefele. “That possibility could bias investors to be early rather than late in adding risk, with a decent pullback in equities viewed as a buying opportunity even before the first rate cut. Investors’ desire to be early on the Fed rate cuts may prevent equities from declining more than 10%.” 

The Fed has given no indication that it plans to cut, and if the central bank lowers rates soon, many believe it will be due to further turmoil with banks or a sudden recession—either of which could hurt stock prices.

And the last time fund managers were positioned as favorably toward bonds, in 2009, rates were near zero, so bonds paid little interest. The rally that followed gave birth to Wall Street sayings like “there is no alternative” to U.S. stocks. Today, high-yield savings accounts are paying 4%. 

One group that hasn’t stopped buying this year: hedge funds. They have increased their stock exposure by a net $30.8 billion since the start of the year, according to S&P.

Still, few in the market appear interested in adding risk right now, added Mr. Janasiewicz of Natixis.

“I’ve been out sharing my optimistic view in meetings with clients, and I’m taking a lot of flack for it,” he said.  

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Image by Germán & Co

World’s most important election…

Erdoğan and Kılıçdaroğlu square up for likely 2nd-round clash in Turkey

Neither the president nor his rival looks set to pass the 50 percent threshold needed for an outright win.

POLITICO EU BY CHRISTIAN OLIVER AND ELÇIN POYRAZLAR, MAY 14, 2023 

ISTANBUL — A singing, grinning President Recep Tayyip Erdoğan told supporters he was ready to fight a second round in Turkey’s election on May 28, sensing he had the momentum to beat his rival Kemal Kılıçdaroğlu, who undershot expectations in Sunday’s first round.

With 92 percent of votes counted, Turkey’s Supreme Election Council said in the early hours of Monday that Erdoğan had won 49.49 percent of the vote, only narrowly shy of the 50 percent needed for an outright win. Kılıçdaroğlu had secured 44.79 percent, disappointing a poll consensus that he had a narrow lead.

A veteran electoral campaigner, a grandstanding Erdoğan appeared on a balcony of his AK party headquarters in Ankara with a microphone singing: “We love you so much” to the crowd and praising them for the “feast of democracy” they had just served up. Dismissing the opposition’s claims of foul play, he even predicted the final trickle of results on Sunday could push him over the 50 percent needed for another five-year stint in power.

Mocking Kılıçdaroğlu, who had filmed in his campaign ads in his modest kitchen, he said: “Some people are in the kitchen, we are on the balcony.”

“We don’t know whether the presidential election will be finished in the first round. If it ends in this round then there is no issue. If our people have decided to finish it in the second round then that’s most welcome too. We believe we will finish the election in the first round successfully.”

A visibly angry Kılıçdaroğlu, whose party accused Erdoğan’s camp of widespread electoral malpractice overnight, snapped back: “Despite all his slander and insults Erdoğan could not get the result he expected. The election cannot be won on the balcony. Data is still coming in.”

“If our people say there’s a second round, we will respect that,” the 74-year-old former bureaucrat added. “We will definitely win this election in the second round … Erdoğan didn’t win the vote of confidence he was expecting … In the next 15 days we will fight for rights, laws and justice in this country.” 

The prospect of a second round will focus attention on where the 5 percent who voted for Sinan Oğan — a former nationalist parliamentarian running as an independent — will take their votes on May 28.

World’s most important election

Turkey’s presidential election has turned into one of the world’s most closely watched political contests this year because of the massive implications both for the future of democracy in the NATO member of 85 million people and for security in Europe and the Middle East.

Heading into the vote, the increasingly authoritarian Erdoğan looked more vulnerable than at any time over his 20-year dominance of Turkey’s politics because of a blazing cost of living crisis, which has pushed the prices of many staples such as onions, meat and cucumbers out of the reach of many consumers. 

Adding to his woes, Erdoğan has also found himself pitted against a united six-party opposition under Kılıçdaroğlu, whose presidential candidacy was also supported by the pro-Kurdish HDP party. 

However, the Islamist populist is able to rely on a strong conservative base and is still held in high esteem because of his massive infrastructure and welfare programs, along with his increased positioning of Turkey as a geopolitical heavyweight.

Despite Erdoğan saying he was on course to win by a hefty margin, the opposition has been predicting it would narrow the gap because of the number of votes still to come from big cities where it is stronger. Kılıçdaroğlu accused government electoral observers of deliberately avoiding adding large numbers of votes from polling stations in opposition strongholds, by continually contesting the count there. 

He said 300 ballot boxes were being held up in Ankara, and 783 in Istanbul. “They are blocking the system at the ballot boxes where our votes are high with repeated objections,” he complained. “Don’t be afraid of the people’s will. Don’t block the people’s will. I call on democracy workers in the field not to leave the ballot boxes. We are here until every vote is counted.”

In a sign of the furor over the degree to which the AK party was demanding recounts, Yunus Başaran, a candidate for the Workers’ Party of Turkey from the southern coastal city of Antalya, said some ballot boxes had been counted seven times. “This time they’ve found this path,” he said.

Journalist Nevșin Mengü tweeted she had information that in the Ankara neighborhood of Çankaya — a traditional opposition bastion — one ballot box had been counted 11 times. Alper Taşdelen, mayor of Çankaya, said almost all of the ballot boxes there were being contested.

Anger over the count

From early evening on Sunday, the counting of the results triggered a bitter political debate, with the opposition accusing Erdoğan’s AK party of several forms of electoral skulduggery.

Two of Turkey’s most senior opposition politicians, Istanbul Mayor Ekrem İmamoğlu and Ankara Mayor Mansur Yavaş, cried foul over the way the state-run Anadolu news agency was reporting results. This is a highly sensitive topic as Anadolu’s feed is widely used by TV channels for their live election coverage. Initially, Anadolu had put Erdoğan on course for a 54 percent to 40 percent win.

The mayors said the agency was giving an exaggerated picture of Erdoğan’s lead early in the evening by cherry-picking results only from districts where the AK party was strong. The intention was to dishearten electoral observers from the opposition camp, who would leave before all ballots had been counted, which would allow ballots to potentially be manipulated.

Kılıçdaroğlu’s opposition vowed that their officials would stay up to head off the problem. Slamming the public announcement of the results by the Anadolu agency as a “fiction,” opposition leader Kılıçdaroğlu called on his teams to stay vigilant. “We will not sleep tonight,” he said.

The opposition mayors pointed out that Anadolu had resorted to the same tactic in the mayoral elections of 2019, initially saying the votes meant the AK party was on course for big wins, while the opposition eventually took Istanbul and Ankara in late counting.

Erdoğan and his AK party officials accused the opposition of deceit, and using the fraud accusation as an excuse for losing.

“Our nation has made its decision. You don’t need to find new excuses. We will see our nation’s will when we have the final results.”

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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The logo of the G7 Finance Ministers and Central Bank Governors' meeting is displayed at Niigata station, ahead of the meeting, in Niigata, Japan, May 10, 2023. REUTERS/Issei Kato/Editing by Germán & Co

Exclusive: G7 leaders to target Russian energy, trade in new sanctions steps

Western allies hunt for new ways to tighten already restrictive sanctions on Russia, from export controls to visa restrictions and an oil price cap, which has put pressure on Russian President Vladimir Putin but not halted the full-scale invasion that started over a year ago.

REUTERS By Trevor Hunnicutt and Andreas Rinke, NOW

WASHINGTON/BERLIN, May 14 (Reuters) - Leaders of the Group of Seven (G7) nations plan to tighten sanctions on Russia at their summit in Japan this week, with steps aimed at energy and exports aiding Moscow's war effort, said officials with direct knowledge of the discussions.

New measures announced by the leaders during the May 19-21 meetings will target sanctions evasion involving third countries, and seek to undermine Russia's future energy production and curb trade that supports Russia's military, the people said.

Separately, U.S. officials also expect G7 members will agree to adjust their approach to sanctions so that, at least for certain categories of goods, all exports are automatically banned unless they are on a list of approved items.

The Biden administration has previously pushed G7 allies to reverse the group's sanctions approach, which today allows all goods to be sold to Russia unless they are explicitly blacklisted.

That change could make it harder for Moscow to find gaps in the sanctions regime.

While the allies have not agreed to apply the more-restrictive approach broadly, U.S. officials expect that in the most sensitive areas for Russia's military G7 members will adopt a presumption that exports are banned unless they are on a designated list.

The exact areas where these new rules would apply are still being discussed.

"You should expect to see, in a handful of spaces, particularly relating to Russia's defense industrial base, that change in presumption happen," said a U.S. official who declined to be named.

The precise language of the G7 leaders' joint declarations is still subject to negotiation and adjustment before it is released during the summit. The G7 comprises the United States, Japan, Canada, France, Germany, Italy and the United Kingdom.

The G7 leaders' action on Russia comes as Ukraine's Western allies hunt for new ways to tighten already restrictive sanctions on Russia, from export controls to visa restrictions and an oil price cap, which have put pressure on Russian President Vladimir Putin but not halted the full-scale invasion that started over a year ago.

Some U.S. allies have resisted the idea of banning trade broadly and then issuing category-by-category exemptions.

The European Union, for instance, has its own approach and is also currently negotiating its 11th package of sanctions since Russia invaded Ukraine, with the bulk focused on people and countries circumventing existing trade restrictions.

"The sometimes-discussed approach of 'we ban everything first and allow exceptions' will not work in our view," said one top German government official. "We want to be very, very precise and we want to avoid unintended side effects."

Meanwhile, any change in language, including language specifying that certain trade is banned unless specifically exempted, by the G7 leaders may not necessarily lead to more bans immediately or indeed any change in Russia's posture.

"At least on day one, that change in presumption doesn't change the substance of what's allowed, but it matters for the long-term trajectory of where we're going and the restrictiveness of the overall regime," the U.S. official said.

Ukraine, backed by Western arms and cash, is expected to launch major counter-offensive operations in the coming weeks to try to recapture tracts of its east and south from Russian forces.

Ukrainian President Volodymyr Zelenskiy has been in Europe this week for meetings with Pope Francis as well as with leaders from France, Italy and Germany. He is expected to address G7 leaders, either virtually or in-person, during their summit in Hiroshima, the officials said.

Former Russian President Dmitry Medvedev said last month a G7 move to ban exports to the country would cause Moscow to terminate a Black Sea grain deal that enables vital exports of grain from Ukraine. Food security in the aftermath of the war is also expected to be a major topic at the G7.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Founder of Wagner private mercenary group Yevgeny Prigozhin leaves a cemetery before the funeral of a Russian military blogger who was killed in a bomb attack in a St Petersburg cafe, in Moscow, Russia, April 8, 2023. REUTERS/Yulia Morozova/Editing by Germán & Co

Wagner head offered to reveal Russian troop locations to Ukraine - Washington Post

Prigozhin, a close ally of Russian President Vladimir Putin, has publicly threatened to withdraw his mercenaries from the area around Bakhmut due to a severe lack of ammunition. These actions could severely affect the ongoing Russian offensive in the region.

Reuters, editing by Germán & Co

May 14 (Reuters) - Yevgeny Prigozhin, the head of the Wagner mercenary force, offered to reveal the position of Russian troops to the Ukranian government, the Washington Post reported on Sunday, citing leaked U.S. intelligence documents.

Wagner's soldiers have been at the forefront of a bloody Russian offensive to take the city of Bakhmut. In exchange for Ukraine withdrawing its soldiers from the area, Prigozhin in January offered to tell its intelligence service the positions of Russian forces, the Post reported.

The paper said Ukraine rejected the offer.

Prigozhin, a close ally of Russian President Vladimir Putin, has publicly threatened to withdraw his mercenaries from the area around Bakhmut, where they are at the vanguard of the Russian offensive, unless they receive much-needed ammunition.

He said Tuesday in an audio message that he and his men would be regarded as traitors if they abandoned the area.

The Post reported Prigozhin's offer came through his contacts with Ukraine's intelligence service.

A White House spokesman declined to comment on the report, which was based on secret U.S. documents leaked to the group-chat platform Discord.

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News round-up, May 12, 2023

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Quote of the day…

A Fundamental Debate over Hydrogen in Brussels:

…”Not everyone is on board with repurposing old gas networks for future use. German companies and municipal utilities hope to make the switch. Still, the issue is being debated in Brussels over an EU directive called the Hydrogen and Gas Market Decarbonization Package. All of this is a part of the larger "Green Deal" program, which aims to greener Europe.

"If we don't use the gas grid for the energy transition, we'll be shooting ourselves in the foot."

Carsten Rolle of the Federation of German Industries

Spiegel 

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Most read…

How Germany's Hydrogen Boom Stalled

Green hydrogen has the potential to heat millions of homes and keep German industry humming. So far, though, a lack of the environmentally friendly gas and the infrastructure needed to transport it have prevented its wide-scale use.

Spiegel By Claus Hecking, Isabell Hülsen, Benedikt Müller-Arnold, Michael Sauga and Gerald Traufetter, 11.05.2023

Europe First: Macron hits the gas in transatlantic subsidy race with EU carmaking cash

French president takes first concrete step in countering Biden’s ‘Buy American’ green subsidies.

POLITICO EU BY GIORGIO LEALI AND JOSHUA POSANER, MAY 11, 2023

Don’t isolate China, Brussels tells EU capitals

Get ready for the Taiwan crisis to blow up but don’t make China ‘more foreign,’ EU document recommends.

POLITICO EU BY STUART LAU, JACOPO BARIGAZZI AND SUZANNE LYNCH, MAY 11, 2023 

OPEC’s Output Slipped in April Ahead of Saudi-Led Production Cuts

Oil prices have tumbled in recent weeks over concerns about the health of U.S. banks

WSJ By Will Horner,  May 11, 2023

The West Needs Russia to Power Its Nuclear Comeback

U.S., Europe add reactors but still heavily dependent on Moscow for crucial ingredients to produce fuel

WSJ by Jennifer Hiller, Daniel Michaels, and Kim Mackrael, May 10, 2023

Henry Kissinger's Shifting Views on Ukraine

Kissinger, a key figure in U.S. Cold War policy towards the Soviet Union during his time under Presidents Nixon and Ford, has always maintained that Ukraine should maintain neutrality and refrain from joining NATO. However, he recently stated at the Davos conference that if Russia were to invade, Ukraine joining the Transatlantic Alliance could be a viable solution.

NEWSWEEK BY JACK DUTTON ON 1/18/23

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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A simulation of the Aquaventus initiative in the North Sea: Electrolyzers will use wind power to produce hydrogen that is to be transported to the mainland via a pipeline. Jakob Martens / AquaVentus/Editing by Germán & Co

How Germany's Hydrogen Boom Stalled

Green hydrogen has the potential to heat millions of homes and keep German industry humming. So far, though, a lack of the environmentally friendly gas and the infrastructure needed to transport it have prevented its wide-scale use.

Spiegel By Claus Hecking, Isabell Hülsen, Benedikt Müller-Arnold, Michael Sauga and Gerald Traufetter, 11.05.2023

The pipe, it seems, just can't get around the seals. On a windy day this winter, hundreds of seals populate the beach at the dune near the island of Helgoland in Germany. They grunt quietly when you get close to them. "Let's keep our distance," says Thilo Thunhorst. "Then the seals don't feel so disturbed."

The animals are a problem for Thunhorst. The 52-year-old is an engineer with Gascade, an energy network operator. On the small island neighboring Helgoland, the company plans to lay a pipeline for the Aquaventus pilot project, one of the most ambitious hydrogen initiatives in the world. After its completion, climate-friendly hydrogen will soon be transported from an offshore wind farm equipped with electrolyzers, to the mainland. German utility company RWE and Shell are among the companies involved.

But not even the pilot project – a single wind turbine with the pipeline connection to Helgoland – is in place yet. The test facility is expected to be up and running in three years – that is, if Thunhorst can get past the seals. Helgoland is surrounded by nature reserves, anchoring zones for tankers and ferries, fisheries and areas which may contain unexploded bombs from World War II.

Thunhorst has to lay the pipeline amid all of that. "If I pay heed to the conservation area, then I have no choice but to run the line through the anchoring zones and the suspected munitions areas," he says.

The only alternative is to cross the dune, the seals' habitat. Or by drilling under the island, an undertaking that would cost several million euros more.

Without Hydrogen, There Can Be No Demand

Welcome to the sobering hydrogen reality. While Germany hopes that it will soon be able to run basement gas heating systems on hydrogen, steel manufacturers are converting their production to the green gas at a cost of billions and energy companies are planning new power plants that will generate electricity from hydrogen, almost everything needed to make the climate-neutral dreams a reality in the near future is still lacking. The environmentally friendly hydrogen is missing, as are the pipeline networks to carry it across the country, not to mention reliable business models.

This plethora of issues has created a chicken-and-egg problem in the industry: So long as there isn't sufficient hydrogen, there won't be demand from customers. And without demand, no one will build a pipeline network, which in turn means no demand.

German Economics Minister Robert Habeck, whose ministry is responsible for the mammoth undertaking, recently complained: "When the Dutch energy minister wants a pipeline to be built, he just calls Gasunie." The state-owned company then sets about getting the work done. In Germany, though, the minister has to deal with 16 long-distance gas network operators, countless municipal utilities and regional network providers, stubborn government coalition partners and powerful lobbying associations.

The hype is thus contradicted by the figures: 44 terawatt hours (TWh) of hydrogen were produced in Germany last year, of which not even 1 percent was produced using climate-neutral green electricity. The rest is "gray" hydrogen and comes primarily from natural gas. By comparison: Last year, Germany required 866 TWh of natural gas for heating, power plants and industry. With the amount of hydrogen that the largest existing electrolyzer can produce each year, natural gas could be replaced in this country for only a half an hour.

There's still a long way to go before green hydrogen can contribute to a secure energy supply. Currently, only 417 kilometers (259 miles) of hydrogen pipelines are in operation across Germany, compared to tens of thousands of kilometers of natural gas networks.

The German government has set itself the bold goal of building electrolyzers with a capacity of 10 gigawatts by 2030. And, indeed, corporations like BP and RWE are planning numerous large-scale plants.

However, final investment decisions are still pending for most of the projects. And that's where things look dire. The United States is currently courting climate-neutral investments with billions in tax subsidies. "Some industries in this country are asking themselves whether hydrogen should still be produced in Europe at all, or whether it would be better to produce it in the U.S.," says Gabriël Clemens, who is responsible for hydrogen and environmentally friendly gases at E.on, a German energy utility company.

"We are discussing petty issues in Germany," complains Uwe Lauber, the CEO of MAN Energy Solutions, which builds such plants, and a member of the National Hydrogen Council, an advisory body to the German government. "But what we need to be doing is to build plants now, big plants." He argues that smaller electrolyzers won't make hydrogen any cheaper and will keep the market from taking off.

A Showcase Project

If there is one place that displays both the progress and backwardness in the quest for hydrogen energy in equal measure, it's the Ruhrchemie plant in the city of Oberhausen. It is a convoluted agglomeration of factories and pipe bridges. Air Liquide, a French company, uses it to produce gray hydrogen from natural gas and distributes it across its own 240-kilometer network, the largest in Germany to date. It winds its way largely underground from Leverkusen, a city that is home to major chemicals manufacturing, with a few branches to the Ruhr region. The pipeline is connected to, among other things, a refinery, plastics factories and the ThyssenKrupp steel mill in nearby Duisburg.

By the end of the year, Air Liquide's network is set to become a little bit greener. An electrolyzer is currently being built in Oberhausen that will produce hydrogen using green electricity. It's a flagship project, which even prompted German President Frank-Walter Steinmeier to pay a visit last week.

Although the plant will be one of the largest water electrolyzers in Germany, with a capacity of 20 megawatts, the volume it produces will only be enough to meet one-sixth of the needs of the factories connected to the pipeline. Why isn't the company thinking in much bigger terms?

Green hydrogen is still twice as expensive as gray hydrogen, explains Gilles Le Van, who is the head of Air Liquide's division for industrial customers in Central Europe. High gas prices and more expensive CO2 emission rights have recently made gray hydrogen significantly costlier, but the production costs for the green alternative hinge on the price of electricity. And electricity prices are at a record high in Germany right now.

The capacity of Air Liquide's network is also limited. With a diameter of no more than 30 centimeters, the pipeline is significantly smaller than long-distance gas pipelines, which easily reach 80 centimeters. Le Van is hoping that natural gas network operators will rededicate at least part of their lines to hydrogen so that the Oberhausen project doesn't remain a lone venture.

Can Existing Gas Pipelines Be Tapped?

When Ontras boss Ralph Bahke wants to know whether hydrogen could flow through his pipes in the future, he pulls out a pipe inspection gauge. The device, which is equipped with sensors, looks like a cross between a space probe and a chimney brush. It can be used to measure the finest cracks and damage inside the steel pipes. If the steel is undamaged, the tube is potentially suitable for the fine hydrogen molecules, meaning it is H2-ready.

Ontras, a subsidiary of German energy utility EnBW, owns around 7,700 kilometers of gas networks in eastern Germany. Large plants such as the Leuna Chemical Complex and the Piesteritz nitrogen works are directly connected to the network. Because gas demand is expected to drop dramatically in the next few years, Bahke is aware that he needs an alternative use for his pipelines, like hydrogen.

Bahke has already tested around half of his network for its suitability for hydrogen. And the majority so far would work, at least in principle. It's good news, Bahke says, "because repurposing costs only one-fifth of what it would cost to build a new network."

Nevertheless, hundreds of kilometers of pipelines still need to be built in order to supply the company's customers with hydrogen on a broad scale, in part because some potential customers weren't even connected to the gas network before. Two model projects in the region alone are expected to devour several hundred million euros in investment by 2030. Will it pay off? "We're doing a lot of the upfront work now," Bahke says.

It's unlikely there won't be enough demand. In a survey conducted by the long-distance gas network operators of their customers in 2021, the reported hydrogen demand increased tenfold compared to 2020. The only problem is that very few of them know who can supply them with hydrogen, in what quantities and at what price. And that's a problem for network operators. Because the lines have to be financed through customer-use fees. If only one customer were to use the network in the beginning, then that customer would also theoretically have to pay the network charge on their own, which would be unimaginable. "We wouldn't be able to muster the revenues we would need," says Bahke.

He argues that the state will have to step in as the guarantor in the development of the hydrogen network. Network operators are already discussing one possible solution with Habeck's Economics Ministry: Charges for the new network could be capped initially so that the customers who are the first to use the lines don't get penalized. If there aren't enough revenues, then the government could step in. "Ideally, demand will be so great by then that no public money will be needed at all," Bahke says in support of the idea.

With the exception of a small project in Bad Lauchstädt, it will be around four years before hydrogen starts flowing through the new Ontras pipelines, in part because they are seeking European Union subsidies in Brussels earmarked for what are called IPCEI projects. These subsidies are intended for projects that are in the EU's interest and deemed to be particularly worthy of support. The processing of the paperwork has been delayed because the European Commission lacks the staff to handle the flood of applications. "We're running out of time," Bahke warns.

To turn the patchwork of regional pilot projects into a national network, the Ontras manager would like to work with the other long-distance gas network operators to design a German start-up network, a kind of highway map for hydrogen. So far, efforts to implement that have collided with the legal situation. Whereas the natural gas network is under the supervision of the Federal Network Agency, which requires suppliers to build and operate pipelines and work together to do so, the hydrogen network has largely been left to the free market so far. Anyone who wants to build a network can do so, provided they have the approval of the regional authorities. At first glance, that looks like a lot of freedom. But German competition law prohibits network operators from colluding. And the Federal Network Agency has so far lacked the legal basis to sign off on the plan for a national network. This is another reason that many plans haven't moved forward.

Since last week, though, it appears that Economics Minister Habeck has come to understand the dilemma. By the summer, the minister wants to amend the Energy Industry Act to enable the rapid development of a start-up network. Habeck initially wants to commission the construction of 1,800 kilometers as part of IPCEI projects. The Federal Network Agency and the operators of the long-distance gas pipelines would also be allowed to design it together. Habeck has also held out the prospect of money to close the financing gap from the initially meager grid fees.

A Fundamental Debate over Hydrogen in Brussels

The hope of companies like Ontras and many municipal utilities to repurpose as many kilometers as possible of their old gas network for future use is by no means universally accepted. Especially not in Brussels, where a lobbying battle is currently raging over an EU directive known as the Hydrogen and Gas Market Decarbonization Package. It is part of the "Green Deal" with which the European Commission wants to transform Europe into a climate-friendly continent.

"If we don't use the gas grid for the energy transition, we'll be shooting ourselves in the foot."

Carsten Rolle of the Federation of German Industries

So far, hydrogen has played only a modest role in those rules. The Commission's argument: The direct use of electricity – in heat pumps and electric motors, for example – is much more efficient than conversion to hydrogen, a process in which considerable energy is lost. Because the green fuel will be scarce and expensive for quite some time to come, they expect it will only be used in a few industries, such as steel and chemicals, as well as in shipping and heavy-duty transport. The remaining energy requirements are to be covered by green electricity and batteries. That would mean that a large part of the network wouldn't even be needed.

A repurposing of gas pipelines for hydrogen, the European Commission fears, could slow down rather than accelerate the transition to clean energies. This is why the Commission is pushing forward with unbundling regulation that would require gas network operators to hand over their pipes in the long term if they enter into the hydrogen business. Unbundling fits with the assumption that hydrogen is likely to be used primarily in industry and heavy-goods transport: If that is the case, why should private citizens help finance the development of this infrastructure with their gas network fees?

The industry recently protested loudly against the Commission's plans. They argue that the regulation would choke off any incentive to invest in hydrogen networks. Papers published by lobbyists speak of "economic nonsense" that makes it more difficult to achieve the climate targets. "If we don't use the gas grid for the energy transition, we'll be shooting ourselves in the foot," warns Carsten Rolle, head of the energy and climate policy department at the Federation of German Industries (BDI). Germany's second legislative chamber, the Bundesrat, which represents the federal states and has traditionally been sympathetic to representatives of the municipal sector, urged the federal government to push for changes to the proposed regulation.

"As industrial centers, Germany and Europe have no time to lose."

Jens Geier, member of the European Parliament

One person who holds a similar view is Jens Geier, the head of the center-left German Social Democratic Party (SPD's) party group in the European Parliament. The gas industry will have to change, says Geier, who is leading negotiations on the regulation for the European Parliament. "That's why it should also take responsibility for the development of the hydrogen networks," he says. "This is important for the timely supply of energy-intensive industry."

In February, members of the European Parliament decided that distribution network operators controlled by municipal authorities should be permitted to transport hydrogen without major restrictions. It was a victory for the gas industry, but only a temporary one. That's because the European Council, which represents the member states, still has to approve the regulation, and it remains controversial there. France, for example, couldn't care less about preserving the German gas network. The government in Paris wants to protect its own electricity sector. In a country with 57 nuclear power plants, electricity had traditionally been more important than gas for energy supply. If Paris had its way, nuclear power would flow directly to electrolyzers located near the factories, eliminating the need for any large hydrogen pipelines.

The gas lobby fears that consensus for that opinion could also develop in Germany. The reason behind that is a recently published paper by the think tank Agora Energiewende, which had been headed for years by Patrick Graichen, the state secretary responsible for the issue at the Economics Ministry, which is led by the Green Party. The Agora study sees no future for more than 90 percent of gas distribution networks in Germany. Instead, it states, the "orderly and timely decommissioning" is a central task of the transition away from natural gas to other technologies for heating.

If, on the other hand, the phase-out were postponed, it would lead to the stranding of up to 10 billion euros in assets. In the end, these costs would be borne by consumers, who, according to Agora's philosophy, should in the future get their heating primarily through heat pumps or district heating.

EU parliamentarian Geier is proposing a compromise. "The EU should put regulation of competition for the hydrogen economy in the hands of individual member states." Then each country could decide for itself which regime best suits its energy system. "As industrial centers," he says, "Germany and Europe have no time to lose."

The German Heating Illusion

E.on executive Gabriël Clemens doesn't want to wait that long. He has been talking to some of his customers about building electrolyzers on site, even if small plants are significantly less efficient than those on a gigawatt scale.

Clemens points out that a supraregional transmission network would be of little help to most German companies. "Small and medium-sized enterprises, the core of the German economy, are connected to the distribution networks." He is thinking primarily of businesses that require high temperatures – glassworks, foundries or ceramics manufacturers, for example. The intricate distribution network would also be needed to realize some politicians' hope of potentially supplying every private boiler room with hydrogen in the near future.

"Hydrogen in the building sector is a niche topic."

Stefan Schönberger, Boston Consulting Group

In contrast to the long-distance gas network, where several pipes run parallel along many routes, the distribution network consists of only a single pipe in many places. Adding hydrogen in these locations is considered a waste of the scarce energy carrier. However, operators such as E.on could only convert entire network sections to 100 percent hydrogen if all connected consumers were able to handle it. Most gas heating systems currently installed allow at most a 20 to 30 percent admixture of hydrogen. And that's not even mentioning the lack of efficiency in the field. "Hydrogen in the building sector is a niche topic," says Stefan Schönberger of the consulting firm Boston Consulting Group.

Despite all the difficulties, E.on has formed partnerships with companies from Canada and Australia to bring hydrogen – in the form of ammonia, for example – to Europe. Ammonia is a compound of hydrogen and nitrogen that can be transported by ship and train and cracked, or broken down, into pure hydrogen on site. "So there are a lot of possibilities, even without pipelines," Clemens says.

Time-Consuming Approval Processes

Meanwhile, on the island of Helgoland, Thunhorst, the engineer, looks out over the sea and points to an imaginary point in the distance where the pilot wind turbine will one day stand. It will be built as far away as possible and close to existing wind farms "so that it is less visibly noticeable," Thunhorst explains. After all, they don't need protests from locals on top of everything else.

Pipeline expert Thilo Thunhorst at the beach populated by seals on a small island near Helgoland

Foto: Claus Hecking / DER SPIEGEL/Editing by Germán & Co

In addition to the seals, Thunhorst has already identified the next problem. A few steps away from the possible landing point of the pipeline on Helgoland, he points to a curly plant on the side of the road. "Real sea kale," he says. "It's protected by nature conservation laws." Before digging can be done here, a biotope type mapping must be done that shows protected plant and animal species in the area.

The pilot project alone requires four permitting processes, with each demanding hundreds of pages of expert opinions. For the full Aquaventus project, five additional permitting processes would be needed. Even in the best-case scenario, that would take years. They are already considering shifting the focus away from Helgoland, across the North Sea.

And why did the planning start so late in the first place? "People believed in cheap natural gas," Thunhorst said. No one could have imagined that one day it would just suddenly stop flowing. Himself included, he says.

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France's President Emmanuel Macron sits inside the Hopium Machina Vision hydrogen-powered car | Pooled photo by Gonzalo Fuentes/AFP/Editing by Germán & Co

Europe First: Macron hits the gas in transatlantic subsidy race with EU carmaking cash

French president takes first concrete step in countering Biden’s ‘Buy American’ green subsidies.

POLITICO EU BY GIORGIO LEALI AND JOSHUA POSANER, MAY 11, 2023

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…”Macron, a student of Kissinger

Don’t repeat this in front of the 26 other European heads of state or government meeting this Monday. [30] and Tuesday [31 mai] in Brussels for a new extraordinary summit dedicated to Ukraine: 44-year-old Emmanuel Macron is following in the footsteps of the most respected and criticized master diplomat of the last century, the American Henry Kissinger.

thenewsdept.com by James, May 31, 2022

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PARIS — Emmanuel Macron took his war of words with Washington to the mat Thursday by proposing a concrete counter to Washington's electric car subsidies — a move likely to further heighten transatlantic tensions.

France, home to major carmakers like Renault and Stellantis, will tailor its existing measures that encourage green vehicle purchases to specifically reward European manufacturers by the end of this year, the president said, calling on the rest of the European Union to take similar action.

"We will be the first European country to reform the criteria for the allocation of the car bonus," Macron said in a speech at the Elysée Palace during an event on re-industrialization, where EU Internal Market Commissioner Thierry Breton also took the floor. "It's a small revolution that we want to bring to the European level," Macron said.

Macron has been a combative voice hitting out at the subsidies under Joe Biden's Inflation Reduction Act, which encourages consumers to "Buy American" when it comes to electric cars and offers other perks to the domestic green industry. He further stirred the pot with Washington last month after a visit to Beijing when he argued Europe should not act as "followers" of the U.S. when it comes to defending Taiwan from China.

The new French measures would, however, also take aim at China, which also subsidizes local carmakers.

"Why should we be the only space in the world that supports what is produced by competitors? We will not close the door to them, but since they already have uncooperative policies, we are not going to further help them with aid measures," he said, referring to the fact that American and Chinese companies can currently benefit from French incentives for consumers who buy eco-friendly goods like electric vehicles and solar panels.

"This doesn't mean that we are protectionist, we are not going to close the market, but we don't want to use the French taxpayers' money to accelerate non-European industrialization," Macron added.

EU leaders are generally worried about Biden's green subsidy scheme, fearing it will hinder production on the Continent and drive companies toward the U.S. to benefit from the $369 billion package. The European Commission has taken its concerns to the World Trade Organization, along with South Korea, Japan, China and Russia, arguing it unfairly discriminates against foreign manufacturers.

But France under Macron has played a more pronounced role as bad cop in talks with Washington meant to find a solution.

"We don't want to depend; we are not meant to become consumers for the American industry," Macron said Thursday.

The new measures will be part of an upcoming "green industry bill," which is set to be adopted during a Cabinet meeting next week and go through parliament this summer. The text, proposed by Economy and Finance Minister Bruno Le Maire, will also include other measures inspired by the U.S. plan, such as tax credits for sectors including batteries, heat pumps, wind and solar power, which, according to Macron, could generate €20 billion in new investments by 2030.

"It will allow us to massively reduce imports of strategic parts from other countries ... by doing this, we'll realign with China and the United States," Macron said.

China in the rearview mirror

While much of Brussels' focus has been on the U.S. scheme's impact on carmakers, many experts argue France has more to fear from Beijing than Washington when it comes to electric vehicles.

Tweaking clean car subsidies to make sure they only benefit local production is exactly the kind of policymaking car executives have been demanding for months to bolster their own efforts to counter both America’s investment splurge and China’s insurgent car brands.

Chinese carmakers — already global leaders in battery technology — have this year doubled down on efforts to crack open the European car market, with brands such as BYD, Nio and Great Wall ramping up their sales plans on the Continent.

“The French are most exposed to the Chinese automotive invasion because they are going straight for their price segment and local carmakers don’t have as much brand value like they do in Germany,” said Matthias Schmidt, an automotive market analyst.

That poses a major threat to European legacy brands, which are already encumbered by the costs of switching away from combustion engines under new EU rules that mandate a transition to only selling all-electric models by 2035.

That's why Macron is now urging Brussels to adopt a similar approach to favor European battery production over foreign competitors.

"I do not want Europe to support batteries that are not made in Europe under its battery legislation, because neither the Americans nor the Chinese are helping batteries made in Europe," he said.

*Giorgio Leali reported from Paris, Joshua Posaner reported from Berlin.

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Chinese President Xi Jinping | Pooled photo by Thibault Camus/AFP/Editing by Germán & Co

Don’t isolate China, Brussels tells EU capitals

Get ready for the Taiwan crisis to blow up but don’t make China ‘more foreign,’ EU document recommends.

POLITICO EU BY STUART LAU, JACOPO BARIGAZZI AND SUZANNE LYNCH, MAY 11, 2023 

BRUSSELS — The EU’s high command is calling on European governments to keep talking to China amid deepening tensions between Washington and Beijing. 

The European Union’s diplomatic arm wants member countries to “be prepared” for a potentially critical escalation in the crisis over Taiwan, warning that a military conflict would upend the vital supply of microchips to Europe. 

But while there’s a need to reduce risks to Europe, it may not seal itself off from China, according to an internal document drafted by the European External Action Service and seen by POLITICO. 

The document, which will be discussed by the bloc’s foreign ministers at a gathering in Stockholm on Friday, comes at a crucial time for the EU as it navigates an increasingly complex relationship with China. The U.S. is doubling down on its hawkish stance toward Beijing, while European leaders have not yet agreed on a unified approach.  ‘terrorist group’

The paper triggered immediate backlash from some of Europe’s more hawkish governments. “With all possible alarm lights flashing, we seem to prefer hitting a snooze button again,” one senior EU diplomat said on condition of anonymity in order to discuss sensitive issues.

In the document, prepared by the EU executive’s diplomatic officials, the bloc’s 27 member countries are urged to seize “a window of opportunity” to reduce the risk of China’s growing influence over economic and security matters. 

A chance remains for Europe to speak directly to President Xi Jinping’s government, the paper says. “China and Europe cannot become more foreign to each other. Otherwise there is a risk that misunderstandings will grow and spread to other areas,” according to the draft. 

“Systemic rivalry may feature in almost all areas of engagement. But this must not deter the EU from maintaining open channels of communication and seeking constructive cooperation with China […] Such cooperation can serve to break through a growing self-induced isolation of the Chinese leadership but most importantly should advance the EU’s core interests,” the paper continued.

Friday’s debate at an informal meeting of foreign ministers in Sweden will fire the starting gun on a discussion over the EU’s relationship with China that is expected to dominate policymaking in the coming months, with a more comprehensive debate expected at an EU leaders’ summit in Brussels this June. 

De-risking Beijing

The paper calls on member countries to speed up plans for “de-risking” and reducing overdependence on China. 

“De-risking can ensure predictability and transparency in our economic and trade relations, while promoting a secure, rules-based approach,” the paper says. 

The call for de-risking comes as Beijing appears increasingly impatient with the narrative that it poses a threat to the West. Chinese Foreign Minister Qin Gang, speaking in Berlin this week, criticized European politicians for attempting to “get rid of China” in the name of de-risking. 

The paper also tackles the politically sensitive issue of Taiwan, with ministers due to discuss this issue as well on Friday. French President Emmanuel Macron told POLITICO in an interview last month that Europe should avoid getting dragged into a confrontation between China and the U.S. over the self-governing island, which Beijing claims as its own. 

On Taiwan, the paper says: “The EU is […] adamant that any unilateral change of the status quo and use of force could have massive economic, political and security consequences, at global level, especially considering Taiwan’s primary role as supplier of the most advanced semiconductors.” 

The document continues: “The EU needs to be prepared for scenarios in which tensions increase significantly. The risk of escalation in the Taiwan Strait clearly shows the necessity to work with partners to deter the erosion of the status quo in the interest of all.”

Some 90 percent of advanced semiconductors imported into the EU come from Taiwan, according to the bloc’s own estimates.

Taiwan’s semiconductor giant TSMC has been under pressure to relocate some of its manufacturing capabilities, but so far it has only moved in the direction of Taiwan’s two presumed security providers — the U.S. and Japan.  

On Ukraine, the EU is not impressed with China’s latest diplomatic show, marked by President Xi Jinping’s belated first call with his Ukrainian counterpart Volodymyr Zelenskyy.

“China’s ’12-point position paper on the Ukraine Crisis’ […] confirms its firmly pro-Russian stance,” the document said. “Direct dialogue between China and Ukraine would be the best opportunity for China to contribute to a fair political settlement,” it continued.

EU member countries should keep warning Beijing to refrain from supporting Russia, including by circumventing sanctions, the same paper added.

The paper also casts gloom on the outlook for China’s domestic development, saying the Asian superpower “is likely to face unprecedented economic and political challenges internally” due to the deceleration of economic growth and demographic change. 

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Photo/ Editing by Germán & Co by Shutterstock

OPEC’s Output Slipped in April Ahead of Saudi-Led Production Cuts

Oil prices have tumbled in recent weeks over concerns about the health of U.S. banks

WSJ By Will Horner,  May 11, 2023

Supply disruptions in Iraq and Nigeria caused OPEC to pump less oil in April, further straining an already tight oil market as some of the group’s largest producers are set to slash output sharply within weeks. 

The declines come as the Vienna-based oil producers’ group left its forecasts for global oil demand and supply unchanged, meaning it continues to foresee stronger demand later this year which the oil market could struggle to satisfy—raising the threat of higher oil prices. 

In its monthly report, the Organization of the Petroleum Exporting Countries said its production fell by 191,000 barrels a day in April to 28.60 million barrels a day due to production problems in Nigeria and a legal dispute in Iraq. 

Iraq’s production fell by 203,000 barrels a day in April from the previous month, OPEC said, citing data collated from several independent data providers such as S&P Global Platts and Argus Media. Nigeria’s output slipped by 170,000 barrels a day. Together the declines outweighed a modest increase in output in Saudi Arabia and Iran.

Iraq’s output has slipped because a pipeline linking its oil-rich semiautonomous Kurdish region with an export terminal on Turkey’s Mediterranean coast has been closed for over a month amid a legal dispute involving Baghdad, the Kurds and Turkey. Talks to resolve the issue have shown signs of progress but flows through the pipeline are yet to resume. 

The declines come as the oil producers’ cartel, which has consistently struggled to meet its own production targets, plans to further reduce its production levels. A group of the cartel’s largest members, including Saudi Arabia—its de facto leader—said last month they plan to reduce output by over 1 million barrels a day starting in May. 

That move has puzzled analysts, who broadly see a need for more barrels of oil this year, not fewer, to meet demand from growing economies in Asia, in particular, China. OPEC’s own forecasts, which it left unchanged in Thursday’s report, also foresee growing demand this year to the tune of 2.3 million barrels a day.  

Russia, meanwhile, which is allied with OPEC in a grouping known as OPEC+, appears to have maintained its output despite saying earlier this year that it would reduce its output by 500,000 barrels a day. As part of the Saudi-led action, Moscow said it would extend those cuts until the end of the year.

Despite initially rising following those cuts, oil prices have tumbled in recent weeks over concerns about the health of U.S. banks heightening fears of a recession that would crimp demand for crude. Brent crude, the international oil benchmark, earlier this month hit its lowest level since December 2021. It fell 1.9% to close Thursday at $74.98 a barrel. The main U.S. oil price shed $1.69 to end at $70.87. 

The declines have added to analysts’ expectations that OPEC+ could use a meeting early next month to recommend reducing its collective output further in an effort to prevent further falls in oil prices. OPEC says it makes changes to output based on demand forecasts and doesn’t seek to direct oil prices.

“OPEC+ hasn’t really even started cutting yet,” said Bjarne Schieldrop, chief commodities analyst at SEB, in a note. “OPEC+ has lots of ‘dry powder’ for further cuts if needed.”

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image by Germán & Co/Shutterstock

The West Needs Russia to Power Its Nuclear Comeback

U.S., Europe add reactors but still heavily dependent on Moscow for crucial ingredients to produce fuel

WSJ by Jennifer Hiller, Daniel Michaels, and Kim Mackrael, May 10, 2023

Nuclear power in the West is having a long-awaited revival, with new reactors opening in the U.S. and Europe and fresh momentum toward building more soon.

A gaping hole in the plan: The West doesn’t have enough nuclear fuel—and lacks the capacity to swiftly ramp up production. Even more vexing, the biggest source of critical ingredients is Russia and its state monopoly, Rosatom, which is implicated in supporting the war in Ukraine.

Nuclear power supplies nearly 20% of U.S. electricity, and roughly 25% of European electricity, but in recent decades has struggled to gain traction in most of the West as a green alternative to fossil fuels, for reasons ranging from cost to waste disposal and an erosion of expertise in building reactors.

Pockets of stiff resistance remain: Germany closed its last reactors in April, in a phaseout that began more than a decade ago.

But there are signs of a shift back in nuclear power’s direction, as governments are drawn to its carbon-free electricity as a tool for fighting climate change and lessening dependence on Russian oil and gas.

In the U.S., after years of delays and billions in cost overruns, a nuclear reactor in Georgia in March began splitting atoms for the first time, a crucial step toward reaching commercial operation. Another reactor at the facility, owned by a unit of Atlanta-based Southern, is scheduled to be operational next year. 

Finland last month started regular electricity output at Europe’s largest nuclear reactor, the continent’s first to open in 16 years, which will eventually produce one-third of the country’s electricity. 

Poland in November chose the U.S. company Westinghouse Electric to build its first nuclear-power plant, which will include three reactors and cost about $20 billion.

A recent Gallup poll found that Americans are more supportive of the technology than at any point in the past decade.

Westinghouse, a storied pioneer of electric power, has struggled in the nuclear sector and repeatedly changed hands amid market swings and tighter industry regulation after the reactor accidents at Three Mile Island, Chernobyl and Fukushima.

A group including private-equity firm Brookfield Asset Management bought Westinghouse for almost $8 billion in October, in a move billed as a bet on nuclear power’s resurgence.

Finland has begun regular electricity production at Europe’s largest nuclear reactor. PHOTO: OLIVIER MORIN/AGENCE FRANCE-PRESSE/Editing by Germán & Co

Westinghouse said this month that it next plans to launch a line of smaller reactors that could cost as little as $1 billion each.

Westinghouse Chief Executive Patrick Fragman said there is a growing public acceptance of nuclear power and that the company has corrected previous mistakes. “We are in a radically different place and we have taken a lot of the lessons of the past,” he said in an interview.

Despite the industry’s progress, the dependence on Russian enriched uranium for nuclear fuel has proven intractable. 

Nuclear fuel is one of the few Russian energy sources not banned by the West as a result of the war in Ukraine. The reason is rooted in a program from the early 1990s, soon after the Cold War ended, aimed at shrinking the threat of Soviet nuclear warheads falling into the wrong hands.

Under the 1993 deal, the brainchild of a Massachusetts Institute of Technology researcher named Thomas Neff and dubbed Megatons to Megawatts, the U.S. bought 500 metric tons of highly enriched uranium, enough for 20,000 warheads, and had it converted into reactor fuel. 

A nuclear reactor in Georgia started to split atoms in March after years of delays and billions in cost overruns. PHOTO: JOHN BAZEMORE/ASSOCIATED PRESS/Editing by Germán 

Arms-control advocates hailed it as a win-win: Moscow got urgently needed cash, Washington reduced its proliferation headache and U.S. utilities got inexpensive fuel. It remains one of the world’s most successful nuclear-disarmament programs.

The deal “did what was promised,” Dr. Neff said in an interview. “We have many fewer nuclear weapons and stuff to make them out of than we did.”

The problem, critics said, was that the deal delivered Russian nuclear fuel so cheaply that rival suppliers struggled to compete. Before long, U.S. and European companies were scaling back and Russia was the world’s biggest supplier of enriched uranium, with nearly half of global capacity.

Before the deal ended in 2013, Russian suppliers, now organized as Rosatom, signed a new contract with the U.S. private sector to provide commercial fuel beyond the government-to-government program. Rosatom still supplies as much as one-fourth of U.S. nuclear fuel.

U.S. companies collectively sent almost $1 billion last year to Rosatom, according to a recent analysis from Darya Dolzikova at the Royal United Services Institute in London.

Russia has seized Ukraine’s Zaporizhzhia nuclear-power plant, the largest in Europe. PHOTO: ASSOCIATED PRESS/Editing by Germán & Co

“That’s money that’s going right into the defense complex in Russia,” said Scott Melbye, executive vice president of uranium miner Uranium Energy and president of the Uranium Producers of America, an industry group. “We’re funding both sides of the war.”

Rosatom was formed by Russian President Vladimir Putin in 2007 from various parts of the country’s nuclear-power industry and is closely controlled by the Kremlin. Its top managers have been deeply involved in running Ukraine’s Zaporizhzhia nuclear-power plant, Europe’s largest, which Russia seized last year and has used as a base for attacks on territory controlled by Kyiv.

Pressure is growing to expand Western uranium-enrichment capacity, not only because a big part of the U.S. economy relies on Russian fuel. A proposed new generation of reactors, which proponents and investors including Microsoft founder Bill Gates are touting as less risky and more environmentally friendly than current reactor designs, requires a special type of fuel that is the nuclear equivalent of high-octane gasoline.

The only source of that fuel today is Rosatom.

“We need fuel to turn our reactor on,” said Jeff Navin, director of external affairs at TerraPower, the Gates-backed company that plans to build its first reactor in Wyoming. He said the U.S. is paying the price for its yearslong unwillingness to build a domestic supply chain for nuclear fuel. “Our options are either build it out now, or hope for some magical solution emerging in another country,” Mr. Navin said.

Russian President Vladimir Putin meeting last year with Alexey Likhachev, CEO of state-run nuclear company Rosatom. PHOTO: MIKHAIL KLIMENTYEV/AGENCE FRANCE-PRESSE/Editing by Germán 6 Co

The multinational Urenco owns one of only two uranium-processing facilities in the U.S., in Eunice, N.M., just across the Texas border. The company says it is spending roughly $200 million on new capacity and can invest much more if Russian uranium is sanctioned.

The catch: It wants government guarantees on quantities allowed in the market.

How do you see nuclear power fitting into the West’s energy future? Join the conversation below.

Urenco’s fear, said Kirk Schnoebelen, head of U.S. sales, is that in several years low-price Russian enriched uranium might swamp world markets, tanking prices.

Mr. Schnoebelen said the concern is born of history. Urenco in the 1990s began planning what was to be the first new uranium-enrichment plant in the U.S. in decades.

But because of the Megatons deal, “the business case for that project was utterly destroyed,” he said. Today that history “absolutely” informs the U.S. nuclear industry’s thinking and makes corporate boards reluctant to invest the necessary billions, he added.

Cylinders of Russian uranium were loaded on a truck in Dunkirk, France, earlier this year. PHOTO: SAMEER AL-DOUMY/AGENCE FRANCE-PRESSE/Editing by Germán & Co

A bipartisan group in Congress is now pushing legislation to ban U.S. use of Russian uranium, build a national uranium reserve, boost domestic ability to refine uranium into fuel and add uranium to the country’s critical minerals list.

“When the Ukraine war is over, it is not going to be over,” said Idaho Sen. Jim Risch, a Republican and co-author of the legislation. “It’s going to take generations before there’s any trust again in the Russians.” 

Westinghouse’s Mr. Fragman said the legislation is long overdue.

“Governments need to keep an eye on what is going on in the nuclear industry,” he said. “At some point when a certain number of Western facilities shut down there should have been an alarm bell.”

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Image: Germán & Co by Shutterstock

Henry Kissinger's Shifting Views on Ukraine

Kissinger, a key figure in U.S. Cold War policy towards the Soviet Union during his time under Presidents Nixon and Ford, has always maintained that Ukraine should maintain neutrality and refrain from joining NATO. However, he recently stated at the Davos conference that if Russia were to invade, Ukraine joining the Transatlantic Alliance could be a viable solution.

NEWSWEEK BY JACK DUTTON ON 1/18/23

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He can find no leader who excites him, with the possible exception of France’s Emmanuel Macron. “I can’t yet say he’s effective because he’s just started but I like his style,” says Kissinger. “Among other European statesmen, Angela Merkel is very local. I like her personally and I respect her but she’s not a transcendent figure.”

www.henryakissinger.com/interviews/lunch-ft-henry-kissinger/

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"I don't think Putin is a Hitler-like character," Kissinger replies. "He comes out of Dostoevsky."

Portofalio magazine interview of Mr. Henry Kissinger in the French restaurant Jubilee in downtown Manhattan in New York on July 27, 2018 

energycentral.com/c/gn/riddle-non-nord-stream-return

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Former U.S. Secretary of State and National Security Advisor Henry Kissinger's stance on Ukraine has changed over the years, including on whether the country should become a NATO member.

Speaking at the World Economic Forum's annual meeting in Davos, Switzerland, on Tuesday, the 99-year-old Kissinger said: "Before this war, I was opposed to membership of Ukraine in NATO because I feared that it would start exactly the process that we have seen now.

"The idea of a neutral Ukraine under these conditions is no longer meaningful."

Kissinger, who was instrumental to U.S. Cold War policy toward the Soviet Union when he served under presidents Richard Nixon and Gerald Ford, has long said Ukraine should remain neutral and not join NATO. Despite this, he said at Davos that the country joining the Transatlantic alliance could be an "appropriate outcome" of Russia's invasion.

He said that dialogue must be kept open between Russia and other countries even as the war rages on in Ukraine.

Kissinger said that Ukraine should recapture territory that has been annexed by Russia while holding negotiations to end the war, which has been going for nearly 11 months.

He said that a diplomatic process could help Russia "re-evaluate its historic position, which was an amalgam of an attraction to the culture of Europe and a fear of domination by Europe."

"Each side needs to consider for itself how the threat to human survival of the destructiveness of weapons, coupled with making them almost conscious in their application, can be dealt with," he said.

But for months before Davos, Kissinger has advocated for a ceasefire that would see Ukraine accept some of the annexed territory as Russian land.

Last May, he suggested a ceasefire that would see Russia withdraw to what the frontlines were before the February invasion, but the status of Crimea would be the subject of "negotiation." But Ukrainian President Volodymr has repeatedly said that all annexed territory, including Crimea, would have to be returned to his country if there is to be peace with Russia.

In 2014, the year Russia annexed Crimea, Kissinger said that Ukraine should be neutral.

'If Ukraine is to survive and thrive, it must not be either side's outpost against the other—it should function as a bridge between them,' he wrote in a Washington Post column.

Russian President Vladimir Putin has said that the threat of Ukraine joining NATO was one of the reasons he launched the invasion last February 24.

U.S. President Joe Biden's administration has said that it was up to Ukraine as to whether it should join NATO. But there has been little support for Ukraine joining the alliance as other members were concerned of guaranteeing mutual security to a country that has been at war with Russia since 2014 over the eastern Crimean Peninsula.

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News round-up, May 11, 2023

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Quote of the day…

Aristotle says that character virtue is acquired by habituation (1103a14–18), and that virtuous people perform virtuous acts not only from good dispositions of action and passion, but also with the appropriate sort of knowledge, and the appropriate motivation (1105a31–33). Habituation can provide good habits of action and passion. Most commentators supplement Aristotle’s explicit statements by telling a story about how learners gain the relevant knowledge. But how, according to Aristotle, do learners come to be well-motivated? How do they come to choose acts for their own sake, or (equivalently, according to Jimenez) for the love of the noble (kalon)?

Marta Jimenez, Aristotle on Shame and Learning to Be Good, Oxford University Press, 2020

What a shame! What a shame!

…”Ex-German chancellor criticised for attending event at Russian embassy

Bild publishes leaked photos showing Gerhard Schröder with his wife and others at Victory Day reception in Berlin

THE GUARDIAN by Kate Connolly in Berlin, Thu 11 May 2023 

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Most read…

E.P.A. Proposes First Limits on Climate Pollution From Existing Power Plants

It’s the last in a string of major regulations proposed by the Biden administration to sharply cut the greenhouse gases produced by the United States.

NYT By Coral Davenport, Reporting from Washington, May 11, 2023

Gazprom mercenary claims turn up heat on EU gas buyers

There are growing reports that the gas giant is financing private militias fighting in Ukraineis , but the EU is unlikely to crack down on the company.

POLITICO BY VICTOR JACK AND GABRIEL GAVIN, MAY 8, 2023

Exclusive: Prime Minister Fumio Kishida Is Giving a Once Pacifist Japan a More Assertive Role on the Global Stage

When U.S. President George H.W. Bush became ill during a luncheon in 1992, puking onto Prime Minister Kiichi Miyazawa's lap before falling out, the bad energy spread across the Pacific. Despite a supposedly successful exorcism by Shinto priests, a connection with demonic spirits was established. The house remained abandoned for nine years until Prime Minister Fumio Kishida moved in shortly after taking office in October 2021.

TIME BY CHARLIE CAMPBELL / TOKYO, MAY 9, 2023 9:00 PM EDT

A Supreme Court Ruling the Fossil-Fuel Industry Doesn’t Like

Communities can now sue in state courts for compensation for the costs of climate change—something oil companies have fought against for years.

THE NEW YORKER By Bill McKibben, May 10, 2023

Ex-German chancellor criticised for attending event at Russian embassy

Bild publishes leaked photos showing Gerhard Schröder with his wife and others at Victory Day reception in Berlin

THE GUARDIAN by Kate Connolly in Berlin, Thu 11 May 2023 

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Source: Media/Editing by Germán & Co

E.P.A. Proposes First Limits on Climate Pollution From Existing Power Plants

It’s the last in a string of major regulations proposed by the Biden administration to sharply cut the greenhouse gases produced by the United States.

NYT By Coral Davenport, Reporting from Washington, May 11, 2023

The Biden administration on Thursday will announce the first regulations to limit greenhouse pollution from existing power plants, capping an unparalleled string of climate policies that, taken together, could substantially reduce the nation’s contribution to global warming.

The proposals are designed to effectively eliminate carbon dioxide emissions from the nation’s electricity sector by 2040.

The regulations governing power plants come on the heels of other Biden administration plans to cut tailpipe emissions by speeding up the country’s transition to electric vehicles, to curb methane leaks from oil and gas wells and to phase down the use of a planet-warming chemical in refrigerants. Together with the 2022 Inflation Reduction Act, which is pouring more than $370 billion into clean energy programs, the actions would catapult the United States to the forefront of the fight to constrain global warming.

“We are in the decisive decade for climate action, and the president’s been clear about his goals in this space, and we will meet them,” Mr. Biden’s senior climate adviser, Ali Zaidi, said in a telephone call with reporters on Wednesday.

The government is not mandating the use of equipment to capture carbon emissions before they leave the smokestack, a nascent and expensive technology. Rather, it is setting caps on pollution rates, which power plant operators would have to meet. They could do that by using a different technology or, in the case of gas plants, switching to a fuel source like green hydrogen, which does not emit carbon.

The nation’s 3,400 coal- and gas-fired power plants currently generate about 25 percent of greenhouse gases produced by the United States, pollution that is dangerously heating the planet.

The plan is sure to face opposition from the fossil fuel industry, power plant operators and their allies in Congress. It is likely to draw an immediate legal challenge from a group of Republican attorneys general that has already sued the Biden administration to stop other climate policies. A future administration could also weaken the regulation.

“This proposal will further strain America’s electric grid and undermine decades of work to reliably keep the lights on across the nation,” said Jim Matheson, president of the National Rural Electric Cooperative Association, which operates power plants serving the nation’s least developed communities.

Senator Joe Manchin III, the West Virginia Democrat who has long fought any threat to his home state’s coal industry, said Wednesday that he would oppose all of Mr. Biden’s nominees to the E.P.A. unless the administration dropped the regulation — a threat that carries teeth in the narrowly divided Senate.

“This administration is determined to advance its radical climate agenda and has made it clear they are hellbent on doing everything in their power to regulate coal- and gas-fueled power plants out of existence, no matter the cost to energy security and reliability,” said Mr. Manchin, who has earned millions from his family’s coal business. Mr. Manchin faces a potentially difficult re-election campaign next year that could pit him against Gov. Jim Justice, a Republican who has announced he will run for the Senate in 2024. West Virginia has increasingly shifted to the right; voters there backed Donald J. Trump over Mr. Biden by 39 points in 2020.

The Biden Administration’s Environmental Agenda

• A Toxic Chemical Zone: As the Biden administration moves to curb health threats caused by toxic chemicals, the debate is hitting home for families living near petrochemical plants.

• Climate Tax Breaks: President Biden’s signature climate law appears to be encouraging more investment in American manufacturing than initially expected. But all that new economic activity is also driving up costs for taxpayers, who are subsidizing the green technology boom.

• Greenhouse Gases: Will the president’s plan to limit greenhouse gas emissions from existing power plants work? Its success could depend on the use of carbon capture technology.

• Protecting the Amazon: Biden pledged $500 million to fight deforestation in Brazil and more than $1 billion to help developing countries transition away from fossil fuels.

Michael S. Regan, the administrator of the Environmental Protection Agency, which drafted the regulations, plans to announce them in a speech on the campus of the University of Maryland on Thursday. E.P.A. officials chose the university setting to appeal to youth climate activists who they hope will help turn out the vote for Mr. Biden’s 2024 re-election campaign.

Many of those activists have been criticizing Mr. Biden after his decision in March to approve an enormous oil drilling project on pristine federal land in Alaska, known as Willow. They view the president’s actions as a betrayal of his 2020 campaign promise to halt new oil and gas drilling on public land.

The White House argues that the collective impact of Mr. Biden’s climate regulations and legislation, in terms of reduced emissions, outweighs any environmental damage that would be caused by the Willow project.

Burning oil drilled at the Willow site would emit an estimated 280 million tons of planet-warming carbon dioxide, according to the White House. The new rules on power plants would lower emissions by 617 million tons between 2028 and 2042, according to the E.P.A. Adding the other proposed E.P.A. regulations would bring the total amount of eliminated emissions to 15 billion tons by 2055 — roughly the amount of pollution generated by the entire United States economy over three years. Several analyses have projected that the Inflation Reduction Act will cut emissions by at least another billion tons by 2030.

That could put the nation on track to meet Mr. Biden’s pledge that the United States would cut its greenhouse gases in half by 2030 and stop adding carbon dioxide to the atmosphere altogether by 2050, although analysts point out that more policies will need to be enacted to reach the latter target.

That is the action required of all major industrialized countries, scientists say, to keep average global temperatures from increasing by 1.5 degrees Celsius (2.7 degrees Fahrenheit), compared with preindustrial levels. Beyond that point, the effects of catastrophic heat waves, flooding, drought, crop failure and species extinction would become significantly harder for humanity to handle. The planet has already warmed by an average of 1.1 degrees Celsius.

“Each of these several regulations from the E.P.A. are contributing to the whole picture that is necessary to steer this ocean liner away from the worst climate disaster,” said Dallas Burtraw, an economist with Resources for the Future, a nonpartisan research organization that focuses on energy and environmental policy.

E.P.A. officials say the proposed regulations are designed to offer flexibility to industry and ensure that the lights remain on and that electricity bills will not soar. For example, coal plants that are already scheduled to retire before 2032 may not have to install new pollution controls like carbon capture technology. About a quarter of operating coal-fired power plants are already scheduled to retire by 2029, according to the Energy Information Administration.

While the proposed rules would increase costs for power plant operators, the E.P.A. estimates that limiting pollution from smokestacks would produce a net economic benefit of up to $85 billion by 2042 through improved public health from lower levels of soot and sulfur dioxide, which also spew from coal-fired power plants.

By 2030, the proposed standards would prevent about 1,300 premature deaths, more than 800 hospital and emergency room visits, more than 300,000 cases of asthma attacks, 38,000 school absences and 66,000 lost workdays, according to the E.P.A.

In some ways, the E.P.A. regulation is designed to speed up changes that are already underway in the energy industry.

Coal, the dirtiest fossil fuel, is in decline — no new coal plants have been built in the United States in the last decade. In the same time frame, the cost of wind and solar power has plummeted, and electricity generation from wind turbines and solar panels has more than tripled. Wind now generates more than 10 percent of the nation’s electricity, and solar power now generates about 3 percent and is growing fast. As a result, planet-warming pollution from power plant smokestacks has dropped by about a 25 percent in the last decade, absent any direct regulation.

In recent years, many large electric utilities have announced targets to stop adding carbon dioxide to the atmosphere by 2045 or 2050.

“Our emissions continue to go down as a sector, and we predict that will continue to happen regardless of the rule,” said Emily Fisher, executive vice president of clean energy and general counsel at the Edison Electric Institute, an organization that lobbies on behalf of investor-owned electric utilities.

Lawyers and lobbyists with the Edison Electric Institute have met with E.P.A. officials at least two dozen times over the past two years to discuss the climate rule and other power plant regulations.

But some lobbyists say that despite that input, the new rules will push the industry to do more than it can achieve.

“There is a lot of consternation that those targets are as fast as they can go,” said Jeffrey Holmstead, a lawyer who represents fossil fuel companies and electric utilities with the firm Bracewell L.L.P. “They didn’t just come up with those targets on the back of an envelope. If the idea is to go significantly faster than that, then companies are going to have real concerns.”

Lissa Lynch, a lawyer with the Natural Resources Defense Council, an advocacy group, said that electric utilities had complained about new clean air regulations for decades but had ultimately managed to comply. “The industry always claims they are impossible to meet, cost too much money, threaten reliability and the economy,” she said of the regulations. “Ultimately they go on to innovate and comply, often well in advance of the deadlines that are set.”

Nearly a decade ago, Mr. Biden’s former boss, President Barack Obama, tried to regulate emissions from power plants. His administration wrote broad and ambitious rules that were designed to replace coal-fired plants with wind farms and solar panels.

That policy was never implemented. It was first blocked by the Supreme Court and later rolled back by President Donald J. Trump.

Last summer, the Supreme Court confirmed that the E.P.A. had the authority to regulate carbon dioxide emissions from power plants, but in a limited way.

Biden administration officials involved with the new power plant rule — many of whom worked on the defunct Obama rule — have sought to ensure that this time, it will stand up to scrutiny.

“In light of what the Supreme Court ruled, they’re not swinging for a home run,” said Richard Lazarus, an environmental law professor at Harvard Law School. “They’re swinging for a hit.”

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PHOTO ILLUSTRATION BY GERMÁN & CO/POLITICO: A Russian serviceman patrols on the promenade in Berdyansk in June 2022 | Yuri Kadobnov/AF

Gazprom mercenary claims turn up heat on EU gas buyers

There are growing reports that the gas giant is financing private militias fighting in Ukraineis , but the EU is unlikely to crack down on the company.

POLITICO BY VICTOR JACK AND GABRIEL GAVIN, MAY 8, 2023

BRUSSELS — Russian gas exporter Gazprom is set to escape this week's EU 11th sanctions package, despite increasing proof it is financing mercenaries fighting in Ukraine.

“I don't think it's a matter of evidence, but of political will,” said an EU national diplomat, who requested anonymity to speak candidly about internal country dynamics. 

The claims Gazprom is directly involved in Russia's invasion of Ukraine have been coming thick and fast.

A series of reports and videos supposedly from fighters on the front lines indicate Gazprom's internal security personnel have formed into volunteer units — the most prominent of which is called Potok, or “stream,” the same name that figures in Gazprom's now-defunct Nord Stream pipelines running under the Baltic Sea.

Potok is reportedly supplied and equipped by Gazprom, although details of how it operates and just how many men it might have are shrouded in secrecy.

Yevgeny Prigozhin, who runs the infamous Wagner mercenary group, claimed on social media last month to have spoken to several recruits from Potok.

Ukrainian intelligence made similar claims in February, alleging a Gazprom subsidiary had set up its own private military unit.

Gazprom didn't respond to a request for comment from POLITICO.

Cutting ties

The Ukrainian government said such reports should prompt Western companies to cut ties with the Russian gas giant.

“This certainly puts Gazprom beyond purely commercial activities and makes it an accomplice to war crimes in Ukraine,” Ukrainian Energy Minister German Galushchenko told POLITICO.

“Now they have reached a new level of being an outright participant in criminally punishable acts,” he said, adding that a “company whose money pays for war crimes and murders cannot be a participant in a civilized market.”

Some EU capitals agree.

“Such facts should only stimulate further discussion … on how we can distance ourselves as much as possible from Gazprom,” one Lithuanian diplomat said.

But that's unlikely to mean a change in EU policy toward Gazprom.

While the bloc has introduced a near-total ban on imports of Moscow’s oil, coal and refined products, natural gas and Gazprom have been spared.

Before the war, Gazprom supplied about 45 percent of the EU's gas imports; that dropped to about 7 percent as of the end of April, according to the Bruegel think tank. Much of that is due to Russia limiting flows and the shut-down of the Nord Stream pipeline, but several EU countries — most prominently Hungary, but also including Austria and Slovakia — still receive some pipeline gas from Gazprom.

Greece's DEPA and Italy's Eni also have ongoing contracts with Gazprom, according to Aura Sabadus, a senior analyst at the ICIS market intelligence firm.

Because EU sanctions are decided unanimously, there's not much chance of finding consensus on punishing Gazprom. In contrast, both the U.S. and the U.K. have imposed sanctions against Gazprom chief Alexey Miller.

From the Commission's point of view, “The risk is that unanimity will not be there in Council, because at least one country, but not only one, has not fully diversified away from Russian gas,” said a senior Commission official, who requested anonymity as they were not permitted to speak publicly.

The claims Gazprom is financing mercenaries fighting in Ukraine have been coming thick and fast | Olga Maltseva/AFP via Getty Images

The reports of Gazprom militias in Ukraine aren't enough to change those views, said diplomats from two EU countries briefed on sanctions discussions.

“While this might increase pressure on some of the holdouts slightly, I don't think it'll convince the real opponents of these sanctions,” said the first national diplomat.

Austria's foreign ministry said there was “no independently verified information” on the existence of Potok but that Vienna was doing “everything possible to further reduce gas dependency.”

A Slovak diplomat said Gazprom sanctions are “not on the table” but “if that happens, we are ready to deal with it seriously.”

That means “the pressure for now is more on [EU countries] taking voluntary commitments,” the senior Commission official said.

Blood and gas

Although details remain scarce on Gazprom’s mercenary unit, the existence of its own armed force is no surprise, experts say.

The company “has for years had its own private security force to guard energy installations and provide security,” said Tracey German, professor of conflict and security at King’s College London. She believes private mercenary groups are being used to fill gaps in the Russian armed forces and also to shroud the true number of casualties incurred in the invasion.

It’s likely Gazprom's forces are well-equipped and have experience in a security service or the military, but "they obviously don’t have the manpower of Wagner," said Konrad Muzyka, a defense analyst at Rochan Consulting.

“These more niche [mercenary groups] are likely to be better trained and the quality of soldiers is likely to be better,” he said, adding they’re probably “tasked with guarding energy infrastructure and their combat operations are better planned … to avoid the kind of losses Wagner has incurred.”

Groups like Potok afford a “very significant source of flexibility” for the Kremlin to achieve its goals in an opaque way outside the law, said Adnan Vatansever, a senior lecturer and Russia energy expert at King's College London.

It’s also a “very desirable scenario” for Russian President Vladimir Putin, he said, who likes to foster competition between elites to stop one group like Wagner becoming dominant and challenging him.

“Gazprom has been a very central player in that power competition,” Vatansever said. “In Russia, there is a saying: ‘Whoever controls Gazprom controls the country.’” 

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Photograph by Ko Tsuchiya for TIME TIME

Exclusive: Prime Minister Fumio Kishida Is Giving a Once Pacifist Japan a More Assertive Role on the Global Stage

When U.S. President George H.W. Bush became ill during a luncheon in 1992, puking onto Prime Minister Kiichi Miyazawa's lap before falling out, the bad energy spread across the Pacific. Despite a supposedly successful exorcism by Shinto priests, a connection with demonic spirits was established. The house remained abandoned for nine years until Prime Minister Fumio Kishida moved in shortly after taking office in October 2021.

TIME BY CHARLIE CAMPBELL / TOKYO, MAY 9, 2023 9:00 PM EDT

The official residence of Japan’s Prime Minister is a spooky place. Inspired by American architect Frank Lloyd Wright, the stone and brick mansion in central Tokyo had been around for only three years when young naval officers charged in and assassinated Prime Minister Tsuyoshi Inukai in 1932. Four years later, Prime Minister Keisuke Okada was forced to hide in a closet during another attempted coup d’état, which killed five and left bullet holes that still pepper the building’s Art Deco facade.

The bad energy became transpacific when, in 1992, U.S. President George H.W. Bush became ill during a banquet here, vomiting onto the lap of Prime Minister Kiichi Miyazawa before passing out. Despite a reported exorcism by Shinto priests, an association with malevolent spirits was sealed, and the residence went unoccupied for nine years until Prime Minister Fumio Kishida moved in soon after taking power in October 2021.

“I have been warned by my predecessors that you will encounter ghosts in this building,” Kishida, 65, tells TIME in an exclusive interview inside the red-carpeted residence, gazing around at the expressionist wall motifs, which include at least one rather menacing concrete gargoyle. “Of course, it is an old building, so I hear sounds from time to time. But fortunately, I have yet to encounter a ghost.”

Kishida is preoccupied by more earthly issues. In Japan, he has launched a “new model of capitalism” to grow the middle class through redistributive policies. Overseas, he has set about revolutionizing the East Asian nation’s foreign relations: soothing historical grievances with South Korea, strengthening security alliances with the U.S. and others, and boosting defense spending by over 50%. Buoyed by a White House eager for influential partners to check China’s growing clout, Kishida has set about turning the world’s No. 3 economy back into a global power with a military presence to match. 

But that’s not to say Kishida is untroubled by ghosts. His family hails from Japan’s southern city of Hiroshima, which he still represents as a lawmaker, and he lost several relatives to the atomic bomb dropped by the U.S. in 1945. His earliest memories include sitting on his grandmother’s knee in the beleaguered city and hearing horrific tales of local suffering. “The unspeakable devastation experienced by Hiroshima and its people was inscribed vividly in my memory,” he says. “This childhood experience has been a major driver of my pursuit … of a world without nuclear weapons.”

It’s to Hiroshima that Kishida welcomes leaders of the G7 from May 19 to 21, when he’ll hope to leverage the city’s tragic history to convince the world’s most powerful democracies that only collective resolve can face down the authoritarian threat of an increasingly belligerent Russia, China, and North Korea. Tokyo may be 5,000 miles from Kyiv, but the war in Ukraine has alerted Japan to a more perilous world, not least since Japan remains entangled in land and sea territorial disputes with Russia, and regularly sees North Korean ballistic missiles flying overhead. Even more worrisome for Japan has been China’s aggression against Taiwan, the self-ruling island that authoritarian President Xi Jinping has repeatedly vowed to bring to heel. When Beijing launched military drills last summer to protest U.S. House Speaker Nancy Pelosi’s visit to Taipei, five missiles fell into the waters of Japan’s Exclusive Economic Zone, through which Chinese naval vessels and aircraft regularly intrude.

Against this backdrop, Kishida in December unveiled Japan’s biggest military buildup since World War II, mirroring upticks in defense spending across Europe, including Germany, which like Japan was humbled by that war. The commitment would raise defense spending to 2% of GDP by 2027, giving Japan the world’s third largest defense budget. And while previous Japanese leaders dithered over imposing international sanctions, Kishida has joined U.S.-led measures with alacrity.

It’s a transformation that had long been touted by Japan’s former Prime Minister Shinzo Abe, who belonged to the same right-leaning Liberal Democratic Party (LDP) and was assassinated during a campaign stop in July. But while Abe’s hawkish reputation was divisive, Kishida’s dovish persona has enabled him to enact security reform without significant pushback.

Still, Japan’s martial resurgence isn’t without controversy. The nation has a pacifist constitution, and critics say its military buildup pours fuel on an already combustive regional security picture. And given that China is Japan’s top trading partner, it’s unclear how Kishida can fund an ambitious domestic agenda while turning the screws on America’s superpower rival, which has proved all too willing to mete out economic retribution. More fundamentally, some believe that Japan’s rearmament chafes with Kishida’s longstanding pledges to work toward a nuclear-free world. The Prime Minister, for his part, says his only goal is to prevent tragedies like Hiroshima unfolding once again: “Today’s Ukraine could be tomorrow’s East Asia.”

Kishida’s tenure has already encountered drama that belies his reputation as a bland functionary. On April 15, Kishida narrowly avoided joining the ghosts stalking the Prime Minister’s residence when a homemade pipe bomb was hurled at him during a campaign speech, injuring a policeman. “I am living in the world of politics,” he shrugs when asked about the incident. “All sorts of events and developments could happen.”

When he took office 18 months ago, he was thought of as a steady but uninspiring politician, unscarred by scandal but lacking major accomplishments. His father and grandfather were both lawmakers, and he spent part of his childhood in the U.S., attending a public school in Queens. Classes were filled with children of myriad cultural and linguistic backgrounds, and Kishida says he found communication “very challenging.” But because of this, “I was reminded of the importance of listening carefully to the views of others,” he says. “As a child, I was inspired by what makes America the United States, which is respect for freedom and an abundance of energy.”

Kishida was an average student, failing his law school entrance exam three times. After cutting his teeth in banking, Kishida entered politics in 1993. He rose to various cabinet posts and was appointed Minister for Foreign Affairs in 2012, serving in the position for five years, a Japanese record. He forged a reputation as a consensus builder, coordinating policy in back rooms by deliberating with various factions. Aides say Kishida takes advice, but once his mind is made up, he doesn’t waver.

As Prime Minister, he’s proved himself a prodigious worker. Kishida has made a dizzying 16 overseas trips since taking office. The day after he sat down with TIME inside his official residence’s vaulted Great Hall, he departed for a four-nation tour of Africa. Aides say he’s barely managed to take any time for himself. “After the [parliamentary] session is over, if some time remains, I hope I will be able to play some golf,” he says with a grin.

But it has not all been smooth on the domestic front. Kishida’s approval ratings plummeted following a backlash to his decision to hold a state funeral for Abe, over both the expense and Abe’s polarizing character. Late last year, Kishida fired four cabinet ministers in two months over a variety of scandals. In February, he dismissed a close aide for saying “quite a few people would abandon this country” if same-sex marriage were legalized, despite a majority of the population’s supporting it. In response, Kishida tells TIME that he is committed to “realizing a society where diversity is respected.” Kishida’s approval rating has since picked up, and his LDP won key seats in local elections in April.

“He may not be an inspiring leader,” says Jeff Kingston, director of Asian studies at Tokyo’s Temple University. “But he has proven to be fairly effective in terms of promoting his agenda.”

It’s an ambitious one. Japan has the world’s second most educated population and boasts its longest life expectancy, lowest murder rate, little unemployment, and unusually smooth political transitions. But it also has one of the world’s lowest birth rates, stagnated growth, and a severely aging population. In the late 1980s, Japanese people earned more than Americans. Now they earn 40% less on average. Kishida’s mission is to drag Japan back up. He has embarked on a sweeping modernization drive, recently green-lighting the nation’s first casino as well as a dedicated autonomous driving lane for the Shin-Tōmei Expressway, a key logistics artery.

Kishida’s domestic agenda rests on a nebulous “income-doubling plan” to boost household earnings, but his big problem is how to pay for redistribution without alienating the affluent. Japan’s ratio of public debt to GDP stands at 256%—about double that of the U.S.—and Kishida has little wiggle room to keep borrowing. When he floated the idea of raising taxes on stock transfers and dividends, Japan’s bourses tanked. “Mr. Kishida has to be pretty careful to keep key right-wing support,” says Mieko Nakabayashi, a professor at Tokyo’s Waseda University and a former Japanese lawmaker.

Kishida also wants to get more women and seniors into gainful employment. Japan ranked 116th among 146 countries—the lowest of developed economies—in the World Economic Forum’s 2022 gender-gap report. But while Kishida’s government has set targets to reach 30% female executives at big firms by 2030, “I don’t think it has clearly stated what kind of action plan it will actually take to achieve the goal,” says Makiko Ono, CEO of Suntory Beverages & Food, Japan’s most valuable company with a female boss.

Ultimately, Japan remains over 30% less productive than the U.S. Kishida has charged Japan’s Digital Agency to cut red tape and boost efficiency. Digital Minister Taro Kono tells TIME that he’s discovered 9,000 government regulations that still require handling via antiquated technology, such as faxes, floppy disks, and the hanko—an iconic carved stamp that is obligatory for many official documents.

But Kono has only 800 officials to serve Japan’s population of 125 million, complaining that his agency is “desperately understaffed.” It’s a monumental challenge; embracing the Fourth Industrial Revolution is crucial for developed societies everywhere, though perhaps none more so than Japan, whose shrinking, aging population has “no precedent in the world,” says Kishida. “This is a matter of survival.”

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Photo/ Editing by Germán & Co by Shutterstock

A Supreme Court Ruling the Fossil-Fuel Industry Doesn’t Like

Communities can now sue in state courts for compensation for the costs of climate change—something oil companies have fought against for years.

THE NEW YORKER By Bill McKibben, May 10, 2023

It was Representative Pat Schroeder, the twelve-term Colorado Democrat, who—while frying eggs one morning—coined the term “Teflon President” for Ronald Reagan. “He sees to it that nothing sticks to him,” she said later, in Congress. Schroeder, who died in March, was the first woman to represent Colorado in the House and an advocate for the environment—she introduced the legislation to establish the Rocky Mountain Arsenal National Wildlife Refuge—and she could have said the same about the fossil-fuel industry. Of all the powerful institutions that we’ve failed to hold to account, none is currently flying higher, despite the fact that the industry’s products have raised the temperature of the Earth to the point where scientists are in near-panic. ExxonMobil, coming off a year of record profits after Vladimir Putin invaded Ukraine, continued to show record earnings in the first quarter of 2023; Chevron, too, reported first-quarter profits that more than doubled its average over the past decade. Asset-management giants such as BlackRock have boosted their stakes in the oil giants, despite the investment firms’ protestations of concern about the climate crisis. ConocoPhillips just won approval from the Biden Administration for a vast new drilling complex in Alaska; Exxon said in late April that it was moving ahead with a giant project off the coast of Guyana. And Kevin McCarthy, the Speaker of the House, is threatening to wreck the world economy, by defaulting on America’s debt, unless, among other things, President Biden’s efforts to move us toward clean energy are repealed. The U.N. Secretary-General, António Guterres, told the industry, earlier this year, that “your core product is our core problem,” but his straight talk hasn’t accomplished much. For now, statements from men such as Exxon’s C.E.O., Darren Woods, hold sway. “We are growing value by increasing production from our advantaged assets to meet global demand,” Woods said, as the news of those robust profits was announced.

Yet last month saw an unexpected development, and it came in the Supreme Court: with only Brett Kavanaugh issuing a public dissent, the Justices declined to review a petition from Exxon and Suncor Energy to move a case from state to federal court. (Simultaneously, the Court denied the same appeal from other major oil companies in four more cases.) Three communities in Pat Schroeder’s state—the City of Boulder, Boulder County, and San Miguel County—had brought suit against the two corporations, seeking compensation for damage wrought there by a warming planet, which, the plaintiffs claim, was caused in part by the companies’ products. That procedural victory may not sound like much, but it could turn out to be a signal moment in the climate fight.

In September, 2015, the Pulitzer Prize-winning Web site Inside Climate News published the first installment of a nine-part series, “The Road Not Taken,” which drew on document archives and interviews with whistle-blowers to show that, as far back as the late nineteen-seventies, Exxon had known about what was then called the greenhouse effect. Company scientists had outfitted an oil tanker to study atmospheric carbon levels as it sailed the seas, and had used computer models to predict the effects of those levels. A corporate primer prepared in 1982—which, according to the contents, was “given wide circulation to Exxon management”—stated that heading off global warming “would require major reductions in fossil fuel combustion.” Without those reductions, “there are some potentially catastrophic events that must be considered,” the primer states, citing independent experts, and “once the effects are measurable, they might not be reversible.” But Exxon didn’t tell the public; instead, as Inside Climate News reported, after the nasa scientist James Hansen had testified before Congress about the dangers of climate change, in 1988—at a hearing called by Senator Timothy Wirth, of Colorado—and public concern began to rise,

Exxon helped to found and lead the Global Climate Coalition, an alliance of some of the world’s largest companies seeking to halt government efforts to curb fossil fuel emissions. Exxon used the American Petroleum Institute, right-wing think tanks, campaign contributions and its own lobbying to push a narrative that climate science was too uncertain to necessitate cuts in fossil fuel emissions.

Exxon, we now know, was far from alone—within the energy and utility industries there was widespread understanding that their products were doing damage. For instance, last month a Dutch climate activist released Shell records from the nineteen-seventies and eighties, including a 1989 document in which the company’s experts predicted that, if temperature increases went well beyond 1.5 degrees Celsius above pre-industrial levels (which is precisely the path on which we are currently travelling), the results would be dire:

Perhaps those in industrial countries could cope with a rise in sea level (the Dutch example) but for poor countries such defences are not possible. The potential refugee problem .&nbsp.&nbsp. could be unprecedented. Africans would push into Europe, Chinese into the Soviet Union, Latins into the United States, Indonesians into Australia. Boundaries would count for little—overwhelmed by the numbers. Conflicts would abound. Civilisation could prove a fragile thing.

(A Shell spokesperson told The New Yorker, in an e-mail, “The Shell Group did not have unique knowledge about climate change. The issue of climate change and how to tackle it has long been part of public discussion and scientific research that has evolved over many decades.” The spokesperson added, “We’ve been advocating for a CO2 trading system for 30 years and, in 1997, publicly supported the Kyoto Protocol.”)

But the impact of Inside Climate News’ 2015 reports and others can hardly be overstated. Worried that the evidence would just disappear into the news cycle, I went to a Mobil station in Burlington, the biggest city in Vermont, where I live, and sat in front of a pump with a sign alerting people to the stories; I blocked business for a few minutes, until I was arrested. A few months later, I paid a fine of a couple hundred dollars, which may have been the only legal repercussion so far of those revelations. After last month’s Supreme Court ruling, however, it likely won’t be the last.

With the new evidence in hand, cities and states around the country began filing lawsuits against oil companies. Some argued simply that the taxpayers in their constituencies should not have to solely bear the cost of damages caused by global warming; others argued that the companies were guilty of consumer fraud or false advertising for insisting that their products were safe; some combined those arguments. The plaintiffs in Colorado are asking that the companies be ordered to compensate them for some of the hundreds of millions of dollars that the communities have spent and will spend trying to mitigate the effects of climate change in the area: Exxon produces a lot of oil and natural gas from Colorado reserves; Suncor, which is headquartered in Canada, operates a large refinery in Commerce City, near Denver. Moreover, the original complaint states that the defendants should help pay because they “knowingly and substantially contributed to the climate crisis by producing, promoting and selling a substantial portion of the fossil fuels that are causing and exacerbating climate change, while concealing and misrepresenting the dangers associated with their intended use.” An Exxon spokesman told The New Yorker, “Those who talk about how ‘Exxon Knew’ are wrong in their conclusions,” and insisted that the corporation’s “understanding of climate science has developed along with that of the broader scientific community.” He added that fighting the state suits will be a “waste of time” and won’t “do anything to meaningfully address climate change.” The plaintiffs note that Suncor may also have conducted independent research but that, in any event, the potential perils of global warming had been known inside the industry for decades. (Suncor did not respond to a request for comment.)

The industry responded to the lawsuits by retaining lawyers who have spent the past half decade arguing that the cases should not be heard in state courts but, instead, should be consigned to the federal judiciary system. Marco Simons, the nonprofit EarthRights International’s general counsel, who is representing the three Colorado communities, said that the companies “argued that any case involving essentially interstate environmental harm or interstate pollution has to be decided under federal law, and that, because climate change is inherently an interstate issue, only federal law can apply. And then they argued that, while only federal law can apply, federal law provides no remedy. Because, they said, federal law in this area is entirely governed by the Clean Air Act, and the Clean Air Act does not directly provide a remedy.” For the industry, a federal process was clearly more attractive—instead of dozens of different venues, they’d have a more manageable process, under one set of rules, that would end in an appeal to the Supreme Court, which lately has been very corporate-friendly.

Six federal appeals courts across the country had heard those arguments over the years, and all six rejected them. (Each appeal required empanelling a three-judge review team, and because one circuit heard multiple appeals before two panels of judges, and because one judge died before he could offer his opinion, the industry lost 20–0 in these forums. One panel consisted of three judges all appointed by President Donald Trump.) But the industry persisted, appealing to the Supreme Court. Cities and states, for their part, argued before the Court that these claims were precisely the kind that state courts are used to adjudicating, and that there was no compelling reason to shift jurisdiction. In October, the Court asked the Biden Administration to weigh in, through its Solicitor General, Elizabeth Barchas Prelogar. Her office reversed the advice given by her predecessor in the previous Administration, and recommended that state courts be allowed to hear the cases. Finally, last month, the Supreme Court agreed. (Though only Justice Kavanaugh publicly dissented, Justice Samuel Alito recused himself; he gave no reason, but reportedly, according to a disclosure filing, either he or his wife has holdings in oil stocks.)

Simons said, “The reason we won in every court is that it was a straightforward application of extremely long-standing rules.” But, he added, “if you take into consideration the fact that it involves some of the most powerful economic actors on claims arising out of climate change, with many of the top corporate law firms begging the Supreme Court to weigh in, you could at least see why the defendants were hoping the Supreme Court would have taken the case. From a strict legal analysis, the decision was not surprising, but from a legal realist power analysis, there were a lot of people who were worried.” As Sam Sankar, the senior vice-president for programs at the nonprofit environmental law firm Earthjustice, told me, “I clerked at the Supreme Court twenty years ago, and it would have been a no-brainer to turn this case down back then. But with this Court you never really know—it does previously unthinkable things surprisingly often.”

So now the cases can proceed in state courts. In at least one instance, the defendants had already filed arguments to dismiss, which were left pending while the Supreme Court made up its mind. But, assuming that cases survive dismissal motions, two things are likely to happen. One is that many more suits may be filed. Lee Wasserman, the director of the Rockefeller Family Fund, which has helped coördinate advocacy groups to hold oil companies accountable (among other things, it has funded 350.org, where I volunteered for many years), said, “The major law firms may have stayed away from these cases to date because they’re so speculative, but one such firm has taken on a big Puerto Rican case, and I think that’s a tell-tale of what we can anticipate in the months ahead.” Sankar told me, “I think there are a lot of plaintiffs’ lawyers who will say, ‘Can’t win if you don’t play.’ They’ll be telling cities, ‘If you don’t bring a suit, you may be missing out on something.’ ” EarthRights International’s Simons added that “there’s no reason injured private parties couldn’t join in. There’s already one case from a Pacific Coast fishermen’s association, arguing that the shellfish harvest has been harmed.” The other thing that is likely to happen is that discovery will begin, in case after case, with lawyers deposing executives and combing through records. “You saw in the Fox case how important that can be,” Sankar said. And, if one team of lawyers finds a significant document, it will quickly become common knowledge: “If Baltimore finds a smoking gun,” he noted, “the information is going to move.”

None of this means that the cases will be simple to prove. For one thing, events that happen in nature have multiple causes. And even when experts can attribute damage to a changed climate—a scientific field that is maturing rapidly—apportioning the blame to particular companies can be difficult. “You can certainly make a determination of how much carbon these companies are responsible for, but in our view that doesn’t completely define their responsibility,” Simons said. “Take Exxon as an example. They’re a participant in the market in many ways—producer, refiner, marketer, and seller. But we also believe that Exxon’s campaign of concealment and deception contributed to the problem. That’s much harder to put a number on, but an essential part of their responsibility and fault.” He added, “We’re not saying they’re a hundred-per-cent responsible, we’re just saying they’re not zero-per-cent responsible. How much is for a jury to decide.”

That’s provided that a jury gets the case. Although the lawsuits in Colorado, and those from other jurisdictions, are now back in state court, this doesn’t mean that federal law doesn’t apply—just as you can use the First Amendment to protect speech in a state court, oil-company lawyers can argue, for example, that the Clean Air Act should take precedence, and someday those arguments may wind up back before the Supreme Court. “This is not a decision that these claims are meritorious or even valid,” Sankar said, of last month’s ruling. “It’s a refusal to say they have to be heard in federal court.”

But assume that such cases do play out. Polling shows that “make polluters pay” is a popular argument that crosses partisan boundaries. And as Wasserman, of the Rockefeller Family Fund, said, “If, as a corporation, you’re found to have deceived the public, there are consequences.” Those consequences could conceivably lead to some kind of general settlement, as happened when a wave of lawsuits forced the tobacco industry not only to pay hundreds of billions of dollars to fund related health-care costs that states had to bear but also to support anti-smoking education programs and even to wind down the corporations’ lobbying front groups. But, Wasserman said, before companies might face that kind of financial peril, they would likely ask Congress to intervene, arguing that “this is the end of being able to pump gas into your car, that Congress has to come up with some kind of release for the industry.” He added that there are models Congress might draw on to wind down the industry, if such negotiations were ever to begin: “In World War Two, the government controlled industries and what they produced. Or think about investor-owned utilities: in the past, the government used to say how much energy they can produce, what their profits will be, what their dividends should be. We can do this—it’s not that complicated.”

Yet, before any pressure like that can build in Congress (or in the stock market), plaintiffs will need to win some cases. “The courts have been the one place where those seeking to right important wrongs and grievances have an equal shot against the most powerful actors in society,” Wasserman said. For example, in the middle of the twentieth century, the civil-rights movement was slowly building a “societal recognition that we needed to change our laws and customs,” and, as it did so, Thurgood Marshall filed case after case, winning most but not all of them. “Then finally, in 1954, came Brown v. Board of Education, and the world was different going forward,” Wasserman said. “The climate movement has suffered from not having a deep and robust litigation strategy, and I think we’re finally overcoming that.”

It’s fitting that the Boulder area is represented in the case the Supreme Court refused to move to federal court. The city’s mayor, Aaron Brockett, told me that the community has worked hard to lower its carbon emissions. (I reached him as he was waiting for a bus to take him thirty miles home from a conference in Denver.) “We’re working on natural climate solutions, our nearby power plant no longer burns coal, our hundred-per-cent renewable-electricity goal by 2030 looks very doable,” he said. And Boulder is home to both the National Center for Atmospheric Research and the noaa Earth System Research Laboratories—there are probably more top-level climate scientists per capita in the area than anywhere else in the world.

The Court’s ruling came almost five years to the day after the Colorado suit was filed. Brett Fleishman—a Boulder resident and longtime climate activist whom I’ve known and worked with for many years, and who now serves as the senior climate strategist for the county government—was at a 2018 rally announcing the suit, with his then three-year-old son, Sequoia, on his shoulders. The Times took a picture of them holding a sign that read “Exxon Suncor = Floods Fires less snow” (The lawsuit states that the E.P.A., among others, has noted that hotter temperatures and droughts, if not Exxon specifically, have increased the risk of forest fires.)

The three largest wildfires in the state’s history occurred in 2020. Then, on December 30, 2021—the day before the latest recorded date in the winter season that the Boulder County area had ever gone without significant snow—the Marshall wildfire, the most destructive fire ever recorded in the state, swept across the region, burning a thousand homes and leaving two people dead. (Different factors play into the spread of winter wildfires, but experts concur that climate change contributes to the conditions for them.) There is footage of people being told by the Boulder County sheriff’s office to immediately evacuate a Costco and “head east,” and video from a Chuck E. Cheese in which parents and kids struggle to open a door against a wind whipping flames across the parking lot. Paul Chinowsky, a professor emeritus at the College of Engineering and Applied Science at the University of Colorado Boulder, who served as a consultant for the scientific and economic rationale for the lawsuit, was at his home when the Marshall fire hit, and had just minutes to grab his research data and flee. In a video about that day’s events, he recalls sitting in a line of cars, trying to escape the blaze alongside thousands of other people. “I picked up my phone and called one of my research assistants,” he says, and told him, “Everything we thought about climate and fire risk is wrong. It has to be changed.” He adds, “Even with all the modelling we’ve ever done, that wasn’t supposed to happen.”

Susie Strife, the Boulder County director of climate action, sustainability, and resilience, told me that the region’s costs from climate change are clearly higher now than when the suit was filed—the Marshall fire did more than two billion dollars’ worth of property damage—and that, along with working on reducing carbon emissions, her team now spends much of its time trying to “get people rehomed, deal with insurance claims, all of that.” She added, “What often gets left out are the emotional and social costs—the long time it takes a family to secure new housing, or the time it takes kids to settle into a new school. These wounds are unquantifiable in today’s economic system—the fact that now we have real anxiety when the wind picks up. We’re Coloradans, we chose to live here because we love the outdoors. And that’s getting lost.”

The Colorado lawsuit, she says, is asking players like Exxon to pay their fair share. But it could come to more than that. “I think the outcome could be an awakening that there has been some serious bad acting going on, some misinformation and disinformation from these companies that have led us to chase our tails, to focus on our own carbon footprints, and not on the massive shift we need to see. This could be our moment of system change.” 

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Schröder and his wife, So-yeon Schröder-Kim, reportedly rubbed shoulders at the event on Tuesday with Egon Krenz, 86, the last Communist leader of East Germany (GDR). Collage: Editing by Germán & Co

Ex-German chancellor criticised for attending event at Russian embassy

Bild publishes leaked photos showing Gerhard Schröder with his wife and others at Victory Day reception in Berlin

THE GUARDIAN by Kate Connolly in Berlin, Thu 11 May 2023 

Leaked photographs have emerged in the German press of the former chancellor Gerhard Schröder, who has refused to denounce his friendship and business ties with Vladimir Putin, as the guest of honour at a reception hosted by the Russian embassy in Berlin.

Schröder and his wife, So-yeon Schröder-Kim, reportedly rubbed shoulders at the event on Tuesday with Egon Krenz, 86, the last Communist leader of East Germany (GDR). Krenz was forced to resign when the Berlin Wall fell, and was later sentenced to six and a half years in prison for his role in the crimes of the Communist regime, in particular the fatal shootings of people trying to escape the GDR.

Other guests included the leadership of the far-right populist Alternative für Deutschland party (AfD) and high-ranking members of the far-left Die Linke. Guests were served champagne and caviar, according to reports.

Schröder, who was chancellor from 1998 to 2005, was a strong advocate for the Nord Stream gas pipeline during his time in office. He has since had roles in the companies Rosneft and Gazprom, which he has now officially renounced. After his resignation from the board of Rosneft over EU sanction concerns, he was spotted in Moscow a year ago by a German reporter, to whom he said: “I’m having a few days holiday in Moscow – it’s a beautiful city.”

Pictures of the Schröders and other guests at the embassy – at a reception to mark Victory Day, or the role of the Soviet Red Army in conquering Nazi Germany in 1945 – were leaked to the tabloid Bild.

The guests would have entered the embassy after passing a protest site against Russia’s war in Ukraine, which is a permanent presence outside the building. Protesters have renamed the space in front of the embassy Freedom Square.

A makeshift memorial to war victims outside the Russian embassy in Berlin. Photograph: Odd Andersen/AFP/Getty Images

Franz Josef Wagner, a veteran columnist for Bild, responded with an angry swipe at Schröder. “Our ex-chancellor eats caviar while Putin is slaughtering people, kidnapping children, letting women be raped. Every sensitive person can smell the sulphur in the embassy – the smell of death. Gerhard Schröder has lost his sense of smell,” he wrote.

Schröder-Kim confirmed to Der Spiegel magazine that the couple had attended the event and said she was “amazed” that this should be viewed with scorn.

Schröder has been isolated by his party, the Social Democrats, for his refusal to denounce Putin’s invasion of Ukraine and over his longstanding gas industry ties with Moscow. He recently failed in an attempt to overturn a ban on his use of taxpayer-funded Bundestag offices and staff amid scathing criticism for his links to Moscow. Attempts to throw him out of the SPD have so far failed.

Tino Chrupalla, the AfD leader, also confirmed his participation, together with Alexander Gauland, who previously held the same role. He told the news agency DPA that he had received an invitation to the reception “as I’m sure all parliamentary faction leaders did”.

Traditionally, he said, 9 May “was until recently a memorial day in which it was taken for granted that German politicians of all parties represented in the Bundestag would take part”. Russia’s invasion of Ukraine should not change this, he said. “This dialogue should not be broken off in times of crisis.”

The free press is under attack from multiple forces. Media outlets are closing their doors, victims to a broken business model. In much of the world, journalism is morphing into propaganda, as governments dictate what can and can’t be printed. In the last year alone, hundreds of reporters have been killed or imprisoned for doing their jobs. The UN reports that 85% of the world’s population experienced a decline in press freedom in their country in recent years. 

Last week marked the 30th annual World Press Freedom Day, a day for everyone to reflect on the importance of free expression as fundamental for all other rights. It is also an opportunity to pledge support for independent media – because without a robust and free press, a healthy democracy is impossible.

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News round-up, May 10, 2023

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Most read…

The Vindication of E. Jean Carroll

In response to a writer’s accusation of sexual assault, nine jurors in Manhattan finally held Donald Trump accountable.

THE NEW YORKER By Eric Lach, May 9, 2023

Big Oil Has $150 Billion in Cash and Investors Want a Share

Companies boost shareholder returns and keep funds for when the boom goes bust

WSJ By David Uberti,  May 8, 2023 

Vladimir Putin Is the World’s Most Dangerous Fool

That's a big issue because that's where this war started, and it didn't come from his cabinet or military leaders, as we now know, and it certainly didn't come from the Russian people as a whole. Therefore, whether Russia wins or loses in Ukraine, it will only be halted if Putin decides.

THE NEW YORK TIME, Opinion Columnist By Thomas L. Friedman, May 9, 2023

Explainer: How will China's clampdown on mislabelled cargoes affect sanctioned oil?

In the past year, a group of Chinese refiners nicknamed "teapots" have become the leading purchasers of Iranian and Venezuelan oil. These independent refiners make up over 20% of China's crude imports and have secured deals with these countries despite international sanctions.

REUTERS By Chen Aizhu and Muyu Xu/ Editing by Germán & Co

Exclusive: Chevron aims to boost Venezuela oil output to accelerate debt recovery -sources

PDVSA and the Venezuelan oil ministry did not respond to requests for comment. In accordance with "all rules and regulations, as well as the sanctions framework supplied by the U.S. Office of Foreign Assets Control," Chevron stated it will continue to operate.

REUTERS By Marianna Parraga and Deisy Buitrago/ Editing by GermÁn & Co

The west must be ready for this moment of opportunity and risk in Ukraine

Ukrainians are preparing for a make-or-break counteroffensive. They have a theory of victory. Do we?

The Guardian by Timothy Garton Ash, Wed 10 May 2023 

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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“E. Jean Carroll wasn’t hiding anything,” Carroll’s lead lawyer said on Monday, as her lawsuit against former President Donald Trump reached its conclusion. Photo: Editing by Germán & Co

The Vindication of E. Jean Carroll

In response to a writer’s accusation of sexual assault, nine jurors in Manhattan finally held Donald Trump accountable.

THE NEW YORKER By Eric Lach, May 9, 2023

Famously, Donald Trump once fantasized about committing murder on the street outside his apartment. “I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn’t lose any voters,” he said, during a 2016 campaign stop in Sioux Center, Iowa. In the recent civil trial that the writer E. Jean Carroll brought against Trump in New York, she didn’t accuse the former President of shooting her outside Trump Tower. She said that he had raped her, just up the block, in the nineteen-nineties. A jury in Manhattan, after listening to the evidence presented to them during the past two weeks, awarded her five million dollars in damages in a civil battery and defamation case. (They stopped short of branding Trump a rapist, settling for a definition of “battery” that includes “sexual abuse.”)

Carroll, ​​a former advice columnist for Elle and media personality, went public with her allegations in 2019, in a New York magazine article, in which she wrote that Trump forced himself on her in a Bergdorf Goodman dressing room. When she first filed a lawsuit against Trump, a few months after the article ran, he was still the President, and many considered the suit hopeless. How could a private citizen get justice through the courts in a case like this, against Trump of all people? And yet on Tuesday, Carroll was vindicated, in a trial that marks the first time jurors have been tasked with determining whether a former President was a rapist or merely a sexual abuser.

Carroll’s lawyers called Carroll herself to the stand (she was also cross-examined by Trump’s lawyers for two days), and then called two friends whom Carroll told about the encounter with Trump shortly after it happened. They also called two other women who have publicly accused Trump of sexual assault—Jessica Leeds and Natasha Stoynoff—as well as an expert in psychological trauma, and two former employees of Bergdorf Goodman, who both supported elements of Carroll’s account, with one testifying that he had seen Trump in the store. Trump skipped the trial, and his lawyers called no witnesses of their own. Joseph Tacopina, Trump’s lead lawyer, said that his client didn’t need to mount a defense, because his case had “emerged” through cross-examination of Carroll’s witnesses. He also pointed to dredged-up text messages and e-mails in which Carroll’s friends seemed to express concerns and frustrations with her. And he offered a number of implausible counter-theories, such as one in which Carroll and her friends had concocted a scheme to frame Trump based on the plot of a 2012 episode of “Law & Order: SVU.” Carroll’s lawyers made much of Trump’s absence. They also didn’t shy away from politics. Several times during the trial, they played the contents of the “Access Hollywood” tape for the jury, including Trump’s boasts of grabbing women “by the pussy.” During closing arguments, one of Carroll’s lawyers suggested to the jury that they consider the “Access Hollywood” video a “confession.”

“You saw for yourself, E. Jean Carroll wasn’t hiding anything,” Roberta Kaplan, Carroll’s lead lawyer, told the jury on Monday, as the trial reached its conclusion. As her lawyers readily acknowledged, Carroll could not remember exactly what night her encounter with Trump took place. She could find no witnesses who saw the two of them together. And though she told two friends about the assault soon after it occurred, she otherwise kept the story to herself for more than two decades. Trump’s lawyers argued that these gaps undercut Carroll’s credibility. “What they want is for you to hate him enough that you’ll ignore the facts,” Tacopina told the jury during his own summation. Carroll, Tacopina said, was abusing the system, bringing a false claim. “We cannot let her profit to the tune of millions of dollars.” Those lines might have played well with Tacopina’s client, but they didn’t sway the jury, which unanimously found in Carroll’s favor after less than three hours of deliberation. (Trump told Fox News Digital that he plans to appeal, and has “no idea” who Carroll is.)

Trump, despite his denials, appeared to understand the seriousness of Carroll’s claims, as both a legal matter and a political one. “She’s accusing me of rape, of raping her, the worst thing you can do, the worst charge,” he said, in a deposition taken last year. Trump is once again running for President, and recent polling suggests that his opponents in the Republican primaries are wilting in the face of his popularity and the pressure he puts on others to fight on his terms. And yet every month this year has brought escalating legal peril to Trump. Seven years ago, he imagined what his supporters would do if he committed a heinous act on Fifth Avenue. Now it’s no longer hypothetical. It’s a matter of record. ♦

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PHOTO ILLUSTRATION BY EMIL LENDOF/THE WALL STREET JOURNAL/Editing by Germán & Co

Big Oil Has $150 Billion in Cash and Investors Want a Share

Companies boost shareholder returns and keep funds for when the boom goes bust

WSJ By David Uberti,  May 8, 2023 

Oil-and-gas companies have built up a mountain of cash with few precedents in recent history. Wall Street has a few ideas on how to spend it—and new drilling isn’t near the top of the list. 

Many companies are cutting costs and raining cash on stock pickers like Berkshire Hathaway’s Warren Buffett, who believe the world’s thirst for oil will continue for years, if not decades, to come. The promise of money returned to shareholders helped turn energy shares into some of the few bright spots in a dark moment for markets last year, fueled by commodity prices that skyrocketed after Russia’s invasion of Ukraine.

Even as an uncertain economic outlook has weighed on crude in 2023, making the energy sector the S&P 500’s worst performer, cash has continued flowing. Companies that previously chased growth and funneled money into speculative drilling investments, weighing down their stocks, have instead tried to appease Wall Street by boosting dividends and repurchasing shares. 

The cash has helped make up for stock prices that often seesaw alongside volatile commodity markets. Steady returns also buoy an industry with an uncertain long-term outlook as governments, markets and the global economy gradually shift toward cleaner energy. 

“They’ve paid dividends forever. That’s been a hallmark,” said Rob Thummel, managing director at Tortoise, an energy investment firm. “But now there’s excess cash beyond dividends to do buybacks.”

Source: FactSet

Six companies often described as Big Oil—Italy’s Eni, France’s TotalEnergies TTE -0.60%decrease; red down pointing triangle, the U.K.’s Shell SHEL -0.03%decrease; red down pointing triangle and BP BP -0.11%decrease; red down pointing triangle, and domestically headquartered Chevron CVX -0.29%decrease; red down pointing triangle and Exxon Mobil XOM 0.03%increase; green up pointing triangle—reported nearly $160 billion in cash and cash equivalents across their balance sheets at the end of the first quarter. State-owned companies and smaller businesses have tens of billions more. 

Chevron and Exxon Mobil hold $48.3 billion of such assets, up $1 billion from the beginning of the year, according to FactSet. Before the cash pileup in recent months, the last time they collectively surpassed $40 billion was in the final weeks of George W. Bush’s presidency as U.S. crude neared the end of a monthslong retreat from a record $145 a barrel. 

Oil profits last year ballooned after Russia’s war on Ukraine pushed up prices and turned gasoline into a street-level reminder that inflation neared 40-year highs. As benchmark U.S. crude prices have dropped 8.8% this year, to $73.16 a barrel, international oil majors, U.S. fuel-makers, independent drillers, Texas wildcatters and Appalachian frackers have kept gobs of cash on hand—partially as insurance if the slide continues.

“We know the good times don’t last,” Chevron Chief Financial Officer Pierre Breber told analysts in an earnings call. 

President Biden has called on producers to ramp up output in a bid to lower prices at the pump. “These balance sheets make clear that there is nothing stopping oil companies from boosting production except their own decision to pad wealthy shareholder pockets and then sit on whatever is left,” White House Assistant Press Secretary Abdullah Hasan said.

But investors have favored financial discipline, and executives are increasingly compensated based on shareholder returns. It marks an about-face in the U.S. oil patch, where companies for years chased production growth by tapping gushers of crude in regions such as the Permian Basin in Texas and Bakken shale in North Dakota. 

By June 2020, as the pandemic brought parts of the country to a standstill, Chevron and Exxon Mobil had together devoted more cash to capital expenditures than shareholder returns for at least 28 straight quarters, according to FactSet. The ratio has been the opposite every quarter since, with the companies paying out $14.8 billion in dividends and buybacks in the first three months of this year, compared with $8.4 billion in capital investment. 

Source: FactSet

Mr. Breber said the San Ramon, Calif.-based Chevron, which boasts almost $15.7 billion in cash and cash equivalents, could operate with a balance sheet one-third the size. 

“We want to return it [to shareholders] through the cycle in a steady way,” he told analysts.

Other U.S. companies have more recently followed the majors’ lead. At ConocoPhillips COP 0.62%increase; green up pointing triangle and 48 smaller publicly traded oil-and-gas firms, executives in the fourth quarter of 2022 funneled 42% of the cash they used into shareholder returns, according to an analysis of financial disclosures by Evaluate Energy. Capital investments comprised 35% of such funds in that period—down from 67% in the first quarter of 2020. 

“U.S. oil-and-gas producers are less focused on capital spending than they have been in years,” said Mark Young, a senior analyst at Evaluate Energy. 

The cash buildup owes itself to other factors as well. Many companies have paid off debt racked up during growth mode, when they dug much of the top-tier territory for wells. While some companies have pledged huge sums to carbon-capture technology or hydrogen production, clean-energy investment has been slowed by lower expected returns and the wait for yet-to-be-finalized regulations in Mr. Biden’s climate package. 

Large companies such as Exxon Mobil have also explored acquisitions to scoop up independent or privately held drillers with faster-growing shale output, The Wall Street Journal has reported. 

Exxon dwarfed other U.S. companies in the first quarter with nearly $32.7 billion cash on hand, up about $3 billion from the end of last year. With yields on short-term investments such as Treasurys higher than what Exxon pays on its debt, “we’re not incurring a negative cost of carry on that cash balance,” Chief Financial Officer Kathryn Mikells told analysts on an earnings call. 

That financial reality, brought on in part by Federal Reserve interest-rate increases aimed at slowing the economy, is changing the idea of what makes an optimal balance sheet for oil companies in an unpredictable market, said Sam Margolin, an analyst at Wolfe Research. 

“It definitely takes the pressure off of trying to jettison cash as quickly as possible,” he said.  

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Image: by Germán & Co

Vladimir Putin Is the World’s Most Dangerous Fool

That's a big issue because that's where this war started, and it didn't come from his cabinet or military leaders, as we now know, and it certainly didn't come from the Russian people as a whole. Therefore, whether Russia wins or loses in Ukraine, it will only be halted if Putin decides.

THE NEW YORK TIME, Opinion Columnist By Thomas L. Friedman, May 9, 2023

I have not written much about the war in Ukraine lately because so little has changed strategically since the first few months of this conflict, when three overarching facts pretty much drove everything — and still do.

Fact No. 1: As I wrote at the outset, when a war of this magnitude begins, the key question you ask yourself as a foreign affairs columnist is very simple: Where should I be? Should I be in Kyiv, the Donbas, Crimea, Moscow, Warsaw, Berlin, Brussels or Washington?

And from the start of this war, there has been only one place to be to understand its timing and direction — and that’s in Vladimir Putin’s head. Unfortunately, Putin doesn’t grant visas to his brain.

That’s a real problem because this war emerged entirely from there — with, we now know, almost no input from his cabinet or military commanders — and certainly with no mass urging from the Russian people. So Russia will be stopped in Ukraine, whether it’s winning or losing, only when Putin decides to stop.

Which leads to fact No. 2: Putin never had a Plan B. It’s now obvious that he thought he was going to waltz into Kyiv, seize it in a week, install a lackey as president, tuck Ukraine into his pocket and put to an end any further European Union, NATO or Western cultural expansion toward Russia. He would then cast his shadow across all of Europe.

This leads to fact No. 3: Putin has put himself in a situation where he can’t win, can’t lose and can’t stop. There’s no way he can seize control of all of Ukraine anymore. But at the same time, he can’t afford to be defeated, after all the Russian lives and treasure he has expended. So he can’t stop.

To put it differently, because Putin never had a Plan B, he’s defaulted to a punitive, often indiscriminate rocketing of Ukrainian towns and civilian infrastructure — a grinding war of attrition — with the hope that he can somehow drain enough blood from Ukrainians, and instill enough exhaustion in Kyiv’s Western allies, that they give him a big enough slice of Russian-speaking eastern Ukraine he can sell to the Russian people as a great victory.

Putin’s Plan B is to disguise that Putin’s Plan A has failed. If this military operation had an honest name, it would be called Operation Save My Face.

Which makes this one of the sickest, most senseless wars in modern times — a leader destroying another country’s civilian infrastructure until it gives him enough cover to hide the fact that he’s been a towering fool.

You can see from Putin’s Victory Day speech in Moscow on Tuesday that he is now grasping for any rationale to justify a war he started out of his personal fantasy that Ukraine is not a real country but part of Russia. He claimed his invasion was provoked by Western “globalists and elites” who “talk about their exclusivity, pit people and split society, provoke bloody conflicts and upheavals, sow hatred, Russophobia, aggressive nationalism and destroy traditional family values that make a person a person.”

Wow. Putin invaded Ukraine to preserve Russian family values. Who knew? That’s a leader struggling to explain to his people why he started a war with a puny neighbor that he says is not a real country.

You might ask, why does a dictator like Putin feel he needs a disguise? Can’t he make his people believe whatever he wants?

I don’t think so. If you look at his behavior, it seems that Putin is quite frightened today by two subjects: arithmetic and Russian history.

To understand why these subjects frighten him, you need to first consider the atmosphere enveloping him — something neatly captured, as it happens, in lyrics from the song “Everybody Talks” by one of my favorite rock groups, Neon Trees. The key refrain is:

Hey, baby, won’t you look my way?
I can be your new addiction.
Hey, baby, what you got to say?
All you’re giving me is fiction.
I’m a sorry sucker, and this happens all the time.
I find out that everybody talks.
Everybody talks, everybody talks.
It started with a whisper.

One of the biggest lessons I’ve learned as a foreign affairs writer reporting from autocratic countries is that no matter how tightly controlled a place is, no matter how brutal and iron-fisted its dictator, EVERYBODY TALKS.

They know who is stealing, who is cheating, who is lying, who is having an affair with whom. It starts with a whisper and often stays there, but everybody talks.

Putin clearly knows this, too. He knows that even if he gets a few more kilometers of eastern Ukraine and holds Crimea, the minute he stops this war, his people will all do the cruel arithmetic on his Plan B — starting with subtraction.

The White House reported last week that an estimated 100,000 Russian fighters have been killed or wounded in Ukraine in just the past five months and roughly 200,000 killed or wounded since Putin started this war in February 2022.

That is a big number of casualties — even in a big country — and you can see that Putin is worried that his people are talking about it, because, beyond criminalizing any form of dissent, in April he rushed through a new law cracking down on draft dodging. Now anyone who doesn’t show up will face restrictions on banking, selling property, even getting a driver’s license.

Putin would not be going to such lengths if he was not fearful that, despite his best efforts, everyone was whispering about how badly the war is going and how to avoid serving there.

Read the recent essay in The Washington Post by Leon Aron, a historian of Putin’s Russia and a scholar at the American Enterprise Institute, about Putin’s visit in March to the Russian-occupied Ukrainian city of Mariupol.

“Two days after the International Criminal Court charged Putin with war crimes and issued a warrant for his arrest,” Aron wrote, “the Russian president came to Mariupol for a few hours. He was filmed stopping by the ‘Nevsky microdistrict,’ inspecting a new apartment and listening for a few minutes to the effusively grateful occupants. As he was leaving, a barely audible voice is heard on the video, crying out from a distance: ‘Eto vsyo nepravda!’ — ‘It’s all lies!’”

Aron told me that the Russian media later scrubbed “It’s all lies” from the audio, but the fact that it had been left in there may have been a subversive act by someone in the official Russian media hierarchy. Everybody talks.

Which leads to the other thing Putin knows: “The gods of Russian history are extremely unforgiving of military defeat,” Aron said. In the modern era, “when a Russian leader ends a war in a clear defeat — or with no win — usually there is a change of regime. We saw that after the first Crimean War, after the Russo-Japanese war, after Russia’s setbacks in World War I, after Khrushchev’s retreat from Cuba in 1962 and after Brezhnev and company’s Afghanistan quagmire, which hastened Gorbachev’s perestroika-and-glasnost revolution. The Russian people, for all their renowned patience, will forgive a lot of things — but not military defeat.”

It’s for these reasons that Aron, who just finished a book about Putin’s Russia, argues that this Ukraine conflict is far from over and could get a lot worse before it is.

“There are now two ways for Putin to end this war he cannot win and cannot walk away from,” Aron said. “One is to continue until Ukraine is bled dry and/or the Ukraine fatigue sets in in the West.”

And the other, he argued, “is to somehow force a direct confrontation with the U.S. — bring us to the precipice of an all-out strategic nuclear exchange — and then step back and propose to a scared West an overall settlement, which would include a neutral, disarmed Ukraine and his holding on to the Crimea and Donbas.”

It’s impossible to get into Putin’s head and predict his next move, but color me worried. Because what we do know, from Putin’s actions, is that he knows his Plan A has failed. And he will now do anything to produce a Plan B to justify the terrible losses that he has piled up in the name of a country where everybody talks and where defeated leaders don’t retire peacefully.

Thomas L. Friedman is the foreign affairs Op-Ed columnist. He joined the paper in 1981, and has won three Pulitzer Prizes. He is the author of seven books, including “From Beirut to Jerusalem,” which won the National Book Award. @tomfriedman • Facebook

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Source: Media

Explainer: How will China's clampdown on mislabelled cargoes affect sanctioned oil?

In the past year, a group of Chinese refiners nicknamed "teapots" have become the leading purchasers of Iranian and Venezuelan oil. These independent refiners make up over 20% of China's crude imports and have secured deals with these countries despite international sanctions.

REUTERS By Chen Aizhu and Muyu Xu/ Editing by Germán & Co

SINGAPORE, May 4 (Reuters) - Chinese customs authorities are stepping up inspection checks on cargoes of heavy crude oil after uncovering several Iranian shipments that were mislabelled as diluted bitumen in an effort to bypass import quotas.

The checks, begun a month ago, are delaying oil discharges into the eastern refining hub of Shandong province.

They are also adding to uncertainty over the risk of disruption to shipments from Iran and Venezuela, while cutting into refining operations just as fuel demand recovers.

China's independent refiners known as teapots, which account for more than a fifth of its crude imports, have become top customers of Iranian and Venezuelan oil since late 2019.

That has followed tough U.S. sanctions on the two exporters, which have supplied China for more than two decades.

The Chinese refiners have increasingly decoupled from the mainstream global oil market to focus almost solely on discounted oil from Iran and Venezuela, and more recently Russian oil in the aftermath of Moscow's invasion of Ukraine.

China has repeatedly condemned Washington's unilateral sanctions and defended trade with Iran and Venezuela as normal business practice in line with international law.

WILL THE CHECKS WIDEN TO ALL IRANIAN CARGOES?

This is unlikely. Traders said they believed the checks were technical rather than political, and aimed to regulate the domestic market and toughen scrutiny of the use of crude oil quotas.

Beijing sets no quotas for state-run refiners, but allots them for independent plants, recently giving greater volumes to "mega" private refiners while cutting back on quotas for smaller plants.

The inspections have primarily targeted shipments of oil with density of less than 950 kg a cubic metre (kg/m3) - mostly Iranian heavy crudes Pars Oil and Soroosh - that account for about 10% to 20% of the Middle East nation's oil into China, compared with dominant Iranian Light and Iranian Heavy.

China's Iranian oil imports, often branded as originating from Malaysia, Oman or the United Arab Emirates, were estimated at 640,000 barrels per day (bpd) in the first quarter of 2023, according to tanker tracker Vortexa Analytics.

That is up from 490,000 bpd a year earlier and down from 960,000 bpd in the fourth quarter of 2022, Vortexa estimated.

VENEZUELAN FUEL

Traders expressed worry that inspections might extend to Venezuelan crude, long used as a feedstock for road-paving bitumen with a density of 950 kg/m3, or higher, and which has been marketed into China in recent years labelled as Malaysian crude or bitumen mix with little hassle.

Vortexa estimated China's first-quarter imports of Venezuelan crude, mostly its main grade Merey, at 430,000 bpd, steady with the previous quarter but up from 300,000 bpd a year earlier.

China has not officially reported any crude imports from Venezuela since October 2019. Only a handful of Iranian oil shipments were officially recorded, often destined for state reserves, after independents took over the business in late 2019.

WHY THE MISLABELLING?

Some independent refiners do not have, or are short of, crude oil import quotas.

Cargoes labelled as diluted bitumen do not require quotas, but are subject to consumption tax of 1,218 yuan ($176) a tonne, and an import tariff of 8%. Refiners can receive partial rebates of the consumption tax after processing.

Traders said the mislabelling was encouraged by steep discounts for Iranian oil, last heard at benchmark Brent futures minus $12.5 a barrel, and recovering demand in China for gasoline, aviation fuel and bitumen.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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An oil pump jack is seen in an oil field near Lake Maracaibo, in Cabimas, Venezuela October 14, 2022. REUTERS/Issac Urrutia/File Photo/ Editing by Germán & Co

Exclusive: Chevron aims to boost Venezuela oil output to accelerate debt recovery -sources

PDVSA and the Venezuelan oil ministry did not respond to requests for comment. In accordance with "all rules and regulations, as well as the sanctions framework supplied by the U.S. Office of Foreign Assets Control," Chevron stated it will continue to operate.

REUTERS By Marianna Parraga and Deisy Buitrago/ Editing by GermÁn & Co

HOUSTON/CARACAS, May 10 (Reuters) - Chevron Corp's (CVX.N) renewed oil operations in Venezuela begin a new phase next month that will boost production with the goal of accelerating a plan to recover all of the $3 billion of debt owed by the OPEC member by the end of 2025, four people close to the matter said.

Washington in November issued a six-month, automatically renewing license to the U.S. oil company to revive largely dormant operations in Venezuela and resume crude exports to the U.S. under an exemption to sanctions on the South American country.

To back up its license application, Chevron last year signed an oil-for-debt swap with Venezuela's state-run PDVSA.

Under the deal, Chevron aims to recover some $750 million in unpaid debts and dividends by year-end, and all $3 billion outstanding by the end of 2025, one of the people said. So far, it has recovered some $220 million, the source said.

The plan shows both Chevron and PDVSA are getting what they wanted from the agreement: Venezuelan oil flowing to the U.S. and the OPEC nation getting royalties, worker benefits and a chance for future profits.

Chevron this year has reactivated crude output at its four joint ventures with PDVSA, exported an average 102,500 barrels per day (bpd), taken a role in procuring supplies and appointed new managers to the ventures' boards.

The initial exports have rapidly drained the ventures' oil inventories, which had built up for years. Chevron plans to continue pushing up heavy crude output mainly at oilfields in eastern and western Venezuela belonging to its Petropiar and Petroboscan projects, according to the sources.

MORE EFFICIENT OPERATIONS

In the second phase, Chevron plans to drive crude production to up to 160,000 bpd this year and about 200,000 bpd in 2024, one of the people said.

To optimize exports, the oil major has proposed to help Venezuela prepare a study on dredging Lake Maracaibo's navigation channel, which would let it load larger tankers, three of the people said.

Chevron also has asked PDVSA to assign it dedicated storage tanks for its joint ventures to improve handling of imported diluents and crude from the Orinoco Belt, Venezuela's largest producing region.

To motivate their joint venture workers, Chevron and PDVSA have agreed to pay bonuses for food and personal care to the staff, and improve their health insurance coverage, they added.

Venezuela's oil ministry and PDVSA did not reply to a request for comment. Chevron said it continues to conduct business "in compliance with all laws and regulations, as well as the sanctions framework provided by the U.S. Office of Foreign Assets Control."

More robust work and investment plans will have to wait, according to the sources.

At the Petropiar joint venture, urgent repairs are needed to its crude upgrader, which converts the Orinoco heavy crude into exportable grades. But major maintenance at the facility and a long-delayed new drilling plan are not expected in the short term, the people said.

"They will continue doing well workover only," one person said.

Chevron CEO Michael Wirth last month said the company's output in Venezuela was expected to reach 150,000 bpd this year without significant new investment and under existing license terms.

GOLDEN TICKET

Chevron's license broke a four-year U.S. prohibition on Venezuelan oil exports to the United States designed to oust President Nicolas Maduro.

Even though the license bans any cash payments to Maduro's administration, it has helped Venezuela stabilize its currency by injecting U.S. dollars into its economy and benefited U.S. Gulf Coast refiners receiving the oil.

According to the oil-for-debt swap's terms, sales proceeds since January are going to the ventures' foreign bank accounts, Reuters has learned.

From there, one portion goes to debt repayment, a second to taxes and royalties through foreign currency exchange transactions by banks in Venezuela, and a third covers operational expenses, the sources said.

Because the license automatically renews every month for six more months, Chevron has dealt with fewer policy changes compared with the system it had until 2020, which required a full renewal of terms at every license's expiration.

The license will keep renewing unless the U.S. decides to rescind it or changes its terms, sources in Washington, Houston and Caracas said.

Reporting by Marianna Parraga in Houston and Deisy Buitrago in Caracas. Additional reporting by Matt Spetalnick in Washington and Sabrina Valle in Houston Editing by Marguerita Choy

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Ukrainian soldiers near Maryinka, a city in the eastern region of Donetsk, where fierce battles against Russian forces have been taking place. Photograph: LIBKOS/AP/Editing by Germán & Co

The west must be ready for this moment of opportunity and risk in Ukraine

Ukrainians are preparing for a make-or-break counteroffensive. They have a theory of victory. Do we?

The Guardian by Timothy Garton Ash, Wed 10 May 2023 

As you read this, thousands of young Ukrainian men and women are going through their last training drills, checking their weapons and waiting for D-day. In the big Ukrainian counteroffensive that may start any time now, some of them will be killed and many more will be wounded. None will emerge unchanged. We thought we had said goodbye to all that in 1945, but this is Europe in 2023.

Nobody knows what will happen in this campaign. Nobody. But we can at least be clear what we want to happen – and firm in supporting the Ukrainians to achieve it. Decisive Ukrainian victory is now the only sure path to a lasting peace, a free Europe and ultimately a better Russia. This alone would be the new VE Day.

Ukrainians have a theory of victory. It goes from success on the battlefield to change in Moscow. For preference, that would be a change of regime, getting rid of the war criminal in the Kremlin. But in the highly unlikely event that Vladimir Putin were to acknowledge his own failure and withdraw his troops, while still remaining in power, that would be victory too.

US and UK tell Russia to stop using hunger as leverage in Ukraine conflict – as it happened

How do they think this might happen, given Russia’s dug-in defending forces and major advantages in numbers and air power? One answer is: the way it happened before in Russian history, with military setbacks triggering the revolutions of 1905 and 1917. If the Ukrainian army can push rapidly south to the Sea of Azov, encircle a large number of demoralised Russian forces and cut the supply lines to the Crimean peninsula, there might be some non-linear collapse of Russian military morale on the ground and regime cohesion in Moscow.

Crimea is the key to this scenario. Ukrainians want to head for the peninsula (but not immediately try to occupy it) for precisely the reason that many western policymakers wish them not to: because Crimea is the thing that really matters to Russia. They add that Ukraine can never have long-term security while Crimea is a giant Russian aircraft carrier pointed at its heart.

It’s a bold and risky theory of victory, but does anyone in the west have a better one? Many western policymakers seem almost as afraid of Ukrainian success as they are of Ukrainian failure, fearing that Putin will escalate in response. So, they nourish a confused idea that there’s a Goldilocks outcome – not too hot, not too cold – that will open the way to the nirvana of a “negotiated solution”. Or, more cynically (self-styled “realistically”), they are privately prepared for Ukraine to end up losing perhaps one-sixth of its sovereign territory, in a partition that they can call “peace”. But at best this would be a semi-frozen conflict, pending renewed war. Here we encounter, once again, the unrealism of “realism”.

Most Western military analysts think that Ukraine is unlikely to achieve a decisive victory, thus making moot the question of whether this would trigger the hoped-for political consequences in Moscow. If you have two exhausted armies, that favours defence over offence. Ukraine has great vulnerabilities in its air defences. The fact that there’s only one obvious path towards Crimea means that Russia is prepared to defend that line. (So it’s possible Ukraine might try something else, but even taking back a substantial chunk of Donbas would not have the same psychological effect in Russia as a threat to Crimea.)

The counteroffensive can deploy nine new western-equipped and trained brigades, but these have a mix-and-match zoo of different western weapons and scant experience in the complex combined arms operations needed to overcome Russia’s defensive lines. Because capitals such as Washington and Berlin have been nervously pondering every item, the Ukrainians don’t have the quantity and quality of western tanks, armoured vehicles, long-range missiles and fighter planes they might have had if the west had not held back for fear of escalation.

The next six months will be decisive. If, come next winter, Ukrainian forces are still bogged down halfway, the west may not deliver a comparable military boost for another offensive next spring. Beside objective difficulties in gearing up our defence industries, there might be waning political support, especially in the US in the run-up to next autumn’s presidential election. There would then be disillusionment in Ukraine. Putin would still be in power. He could use his propaganda apparatus at home to sell his partial occupation of Ukrainian territory as a historical restoration of Catherine the Great’s empire.

The alternative, perhaps unlikely but still possible, is a decisive Ukrainian victory. Since that would mean a defeat that even Putin’s state lie-machine could not conceal, the path to victory would bring a moment of increased risk. Although nobody knows exactly what’s going on inside the Kremlin black box, intelligence-based analysis suggests that Putin has wargamed and rejected the option of using tactical nuclear weapons, as this would bring no clear military advantage and alienate China and India. But the situation around the Zaporizhzhia nuclear-power plant, which was seized by Russia in February 2022 and around which the occupiers have now evacuated the local population, is extremely worrying. He also has other possible asymmetric responses, such as a cyber-attack or targeting a gas pipeline.

Understanding Vladimir Putin, the man who fooled the world

What should we do about this? Don’t be scared, be prepared. There is no risk-free way forward. Avoiding an immediate risk can mean creating larger risks down the road (which is the mistake the west made after 2014 when it allowed Russia to keep Crimea and negotiated the sticking plaster Minsk Agreement for occupied eastern Ukriane). These risks include not only recurrent armed conflict in Ukraine but also encouraging China to have a go at Taiwan. I’ve lost count of the number of times Ukrainians have said to me that the west’s biggest problem is fear. “The choice is between freedom and fear,” President Volodymyr Zelenskiy recently told the Atlantic. So we have to keep our nerve and show just a little of the fortitude that those thousands of young Ukrainians are demonstrating, as they prepare to risk their lives to defend their freedom.

I’m acutely aware of the need to avoid any hint of armchair heroism. Even if I travel to Ukraine occasionally during this war, I’m not taking a small fraction of the personal risk that Ukrainians face. Responsible governments must recognise, anticipate and carefully weigh the real dangers of escalation. Prudence is not cowardice. But there’s also another thing to avoid: the woolly talk of “peace” and “responsibility”, which actually means urging, or ultimately even compelling, other people to sacrifice their own homes, freedom and security, so that citizens of countries such as Germany, France or Italy can, if only in the short term, go on enjoying these things for themselves.

The west has done that many times before to people in central and eastern Europe. Let’s not do it again.

Timothy Garton Ash is a historian, political writer and Guardian columnist

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News round-up, May, 9, 2023

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Most read…

Biden Casts Himself as the Trump Beater. Polls Suggest That’s No Sure Thing.

While the president argues that he is the one best positioned to stop his predecessor from returning to the White House, surveys indicate that he starts the 2024 race facing enormous challenges.

NYT By Peter Baker, May 8, 2023

Why Texas, a clean energy powerhouse, is about to hit the brakes

The state’s clean energy boom could be impeded by Texas leaders’ push for legislation that would boost natural gas and place new restrictions on wind and solar projects

WP By Anna Phillips, May 8, 2023

‘Over Our Dead Bodies’: Backlash Builds Against $3 Trillion Clean-Energy Push

Ballooning size of wind and solar projects draws local ire as they march closer to populated areas

WSJ TODAY

EU targets Central Asia in drive to stop sanctioned goods reaching Russia  

Several EU countries fear Brussels risk opening a Pandora’s box with a new measure that could eventually be used against China and Turkey.

POLITICO EU BY BARBARA MOENS, LEONIE KIJEWSKI AND SUZANNE LYNCH, MAY 8, 2023 

Analysis: Chile’s constitution will struggle to escape Pinochet’s shadow

This result has made it easier for far-right candidates like Kast to win elections: "Kast, a lawyer and supporter of the terrible Pinochet regime.

REUTERS By Alexander Villegas and Natalia A. Ramos Miranda

‘Mind-boggling’ methane emissions from Turkmenistan revealed

Leaks of potent greenhouse gas could be easily fixed, say experts, and would rapidly reduce global heating

The Guardian by Damian Carrington Environment editor, Tue 9 May 2023 

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Mr. Biden has dismissed the importance of polls, saying that he is no different from other presidents at this point in their terms.Credit...Doug Mills/The New York Times/ Editing by Germán & Co

Biden Casts Himself as the Trump Beater. Polls Suggest That’s No Sure Thing.

While the president argues that he is the one best positioned to stop his predecessor from returning to the White House, surveys indicate that he starts the 2024 race facing enormous challenges.

NYT By Peter Baker, May 8, 2023

WASHINGTON — Boiled down, President Biden’s argument for running for a second term rather than ceding the ground to the next generation is that he is the Democrat most assured of beating former President Donald J. Trump next year.

But a striking new poll challenged that case in a way that had much of the capital buzzing the last couple of days. Taken at face value, the poll showed Mr. Biden trailing Mr. Trump by six percentage points in a theoretical rematch, raising the question of whether the president is as well positioned as he maintains.

No single poll means all that much, especially so early in an election cycle, and the president’s strategists as well as some independent analysts questioned its methodology. But even if it is an outlier, other recent surveys have indicated that the race is effectively tied, with either Mr. Biden or Mr. Trump holding narrow leads within the margin of error. Taken together, they suggest that the president opens the 2024 campaign facing enormous challenges with no guarantee of victory over Mr. Trump.

The data has left many Democrats feeling anywhere from queasy to alarmed. Mr. Biden’s case for being the pair of safe hands at a volatile moment is undermined in their view if a president who passed major legislation and presides over the lowest unemployment in generations cannot outperform a twice-impeached challenger who instigated an insurrection, has been indicted on multiple felonies, is on civil trial accused of rape and faces more potential criminal charges in the months to come.

“The poll demonstrates that the president still has work to do, not only in convincing the American people that he’s up for the job that he wishes to complete,” said Donna Brazile, a former chairwoman of the Democratic National Committee who said she lost sleep over the “ominous signs” in the latest survey results. “More importantly, it’s a good forecast of the challenges he will face in rebuilding the remarkable coalition that elected him in 2020.”

“I don’t think that they should panic because you can’t panic after one poll,” said Ms. Brazile, who managed Al Gore’s presidential campaign in 2000. A survey is “just one gauge” among many on the long road to the voting booth. “But it’s an important barometer of where the electorate is today, some 547 days away from the November 2024 election.”

The survey by The Washington Post and ABC News found that the president’s approval rating has slipped to 36 percent and that Mr. Trump would beat him by 44 percent to 38 percent if the election were held today. Just as worrisome for Democrats, respondents considered Mr. Trump, 76, more physically and mentally fit than Mr. Biden, 80, and concluded that the former president managed the economy better than the incumbent has.

“The poll really is trash, and I don’t say that lightly because I’ve had respect for their polling in the past,” said Cornell Belcher, who was President Barack Obama’s pollster. “However, their methodological decision here is problematic,” he added of the way the survey was constructed.

Others cautioned against overanalyzing data this early, noting that anything can happen in the next 18 months and recalling that projections based on polling — or misinterpretations of polling — proved to be poor predictors in recent cycles, including the 2022 midterm elections when a forecast “red wave” did not materialize.

“Polls in May 2024 will be of dubious value,” said David Plouffe, who was Mr. Obama’s campaign manager. “Polls in May 2023 are worth as much as Theranos stock.”

The White House expressed no concern over the latest surveys. “President Biden’s average job approval is higher now than in early November when poll-based reporting widely prophesied a supposedly inevitable red wave that never arrived,” said Andrew Bates, a White House spokesman.

Kevin Munoz, a spokesman for the fledgling Biden campaign, said the president would win on issues like lowering prescription drugs and protecting Social Security. “Americans voted for Joe Biden’s America in 2020 and 2022, and regardless of what today’s Beltway insider says, they will again in 2024,” he said.

While not predictive, recent surveys provide a foundational baseline at the start of a race potentially between two universally known figures, foreshadowing a campaign without a clear front-runner. Polls by Yahoo News, The Wall Street Journal and Morning Consult have found the president slightly ahead while surveys by The Economist and the Harvard University Center for American Political Studies found him tied or trailing by several points. Mr. Biden faces similarly mixed results against Gov. Ron DeSantis of Florida, the strongest challenger to Mr. Trump for the Republican nomination.

The results point to a calcification in American politics where the leaders of both parties have a similarly sized core of support among voters not open to the other side regardless of developments in the news. The days when presidents could enjoy approval ratings above 50 percent or double-digit leads over challengers for any sustained period of time appear to be long over. And so if widespread support is no longer achievable, the challenge for Mr. Biden is to reassemble the coalition that provided him a 4.5-percentage-point victory nearly three years ago.

Mr. Biden has dismissed the importance of polls, saying that he is no different from other presidents at this point in their terms. “Every major one who won re-election, their polling numbers were where mine are now,” he told Stephanie Ruhle on “The 11th Hour” on MSNBC on Friday.

But in fact, only two of the past 13 presidents had approval ratings lower than Mr. Biden has at this point, according to an aggregate compilation by FiveThirtyEight.com — Mr. Trump and Jimmy Carter, both of whom lost re-election. More encouraging for Mr. Biden is the example of Ronald Reagan, who was just one-tenth of a point above where the current president is at this stage of his presidency, but came back to win a landslide re-election in 1984.

Whit Ayres, a Republican consultant, said it was telling that Mr. Biden was essentially tied or behind “a former president carrying more baggage than a loaded 747” and warned Democrats against complacency.

“Democrats are in denial if they think Biden cannot lose to Trump in 2024,” he said. “Trump can most certainly win. Joe Biden is asking the country to elect a candidate who will be 82 years old, who has clearly lost a step, running with a vice president whom almost no one in either party thinks is ready for prime time.”

The Post-ABC poll and other surveys contain grim news for Republicans as well. While Mr. Trump leads or keeps relatively even with the president, he may have a ceiling beyond which he cannot rise, while Mr. Biden can still win over ambivalent independents who dislike the former president, analysts said.

“While the poll is not great news for Biden, it’s not great news for the Republicans either,” said Anna Greenberg, a Democratic pollster. “Only about a third say they are strong supporters for Biden, DeSantis and Trump. It feels more unsettled than anything else.”

She said that the real choice between Mr. Biden and Mr. Trump, should it come to that, would force ambivalent Democrats and independents to come off the fence. “I noticed more softness among Democrats, but I have no doubt that no matter what skepticism Democrats tell pollsters right now, they are going to vote for Joe Biden,” she said.

Stuart Stevens, who ran Mitt Romney’s campaign against Mr. Obama in 2012 and is a vocal critic of Mr. Trump, noted that the Republican establishment worries that the former president cannot win even though he leads in some polls. “We seem to be in this weird moment when Republican elite are panicked that Trump can’t beat Biden,” he said. “I think that’s because they know that Trump is deeply flawed.”

David Axelrod, the former Obama senior adviser who was on the other side of that race from Mr. Stevens, agreed with his assessment. “What Biden has that no one else does is a record of having beaten Trump, which weighs heavily in conversations among Democrats about the race,” Mr. Axelrod said. “He also has a record to run on and a party out of the mainstream on some important issues to run against, with a deeply flawed front-runner.”

“The worry for Democrats is that the re-elect is subject to a lot of variables Biden can’t entirely control — including his own health and aging process,” Mr. Axelrod added. “Any setback will exacerbate public concerns already apparent in the polls about his condition and ability to handle four more years.”

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Wind turbines are seen at sunset on a wind farm near Del Rio, Texas. Lawmakers in the Lone Star state are considering legislation that would slow the growth of new solar and wind projects. (Eric Gay/AP)

Why Texas, a clean energy powerhouse, is about to hit the brakes

The state’s clean energy boom could be impeded by Texas leaders’ push for legislation that would boost natural gas and place new restrictions on wind and solar projects

WP By Anna Phillips, May 8, 2023

Already No. 1 in wind power, and home to a fast-growing solar industry, Texas is poised to become a renewable energy powerhouse — timely because President Biden’s climate bill is about to deliver billions in subsidies.

But instead of embracing the green boom, Texas’ Republican-controlled legislature has introduced a spate of bills that could slow the growth of wind and solar industries, which has their leaders alarmed.

“Every state has legislation related to the placement of projects, but what we’re seeing in Texas is far beyond anything we’ve seen anywhere else,” said Jeff Clark, chief executive of the Advanced Power Alliance, an Austin-based trade group for renewable energy companies. “The aggressiveness of some of this legislation and the volume is unprecedented.”

Texas embraces a famously laissez-faire approach to energy development, but now some of its most anti-regulatory lawmakers are pushing new rules and permitting requirements for solar and wind, while backing measures that would bolster natural gas. Some Republicans have justified these moves by arguing that renewable energy is inherently unreliable and that more fossil fuels are needed to avoid another electricity blackout crisis — even though most of the loss of generating capacity during the 2021 outage came from gas power plants.

Other GOP officials say they are acting, in part, because the rapid expansion of solar and wind projects threatens the scenic character and way of the life of the state’s rural communities.

Solar and wind developers and environmental groups say these arguments are a cover for a politically driven effort to penalize renewables. After years of enjoying a hands-off environment, they say renewable energy has gotten caught up in a polarized culture war that has conservative state lawmakers attacking the industry to establish their national bona fides.

One of the bills in question would require large-scale wind and solar farms to win the approval of the Public Utility Commission of Texas, whose members are appointed by Gov. Greg Abbott (R), a staunch supporter of fossil fuels. New projects would be subject to a state environmental impact review, developers would have to pay a yearly fee, and they would need a new permit anytime they made significant changes to existing projects. Senate Bill 624 would also require wind turbines to be built at least 3,000 feet from any property lines — a little more than half a mile — a distance Clark called “absurd.”

The bill’s supporters include Houston billionaire Dan Friedkin, chairman and chief executive of the Friedkin Group, a collection of automotive and travel companies. Friedkin — who also co-owns film production and marketing companies — has not said why he is backing the measure. A lobbyist for the company who registered its support did not respond to messages seeking comment.

But some rural landowners in Texas have banded together to torpedo solar and wind projects, and Friedkin is the owner of the sprawling Comanche Maverick Ranch near Carrizo Springs. State records show he has previously intervened to prevent an electric transmission line from being built on the property, saying it would harm the ranch’s aesthetics, fragment wildlife habitat and lead to increased illegal drug trafficking.

Friedkin is not alone — standing behind the bill is a group of landowners, called the Texas Real Estate Advocacy and Defense Coalition, whose members say they are alarmed by the size and number of solar farms popping up across the state, particularly near pristine landscapes and in areas where developers have cut down trees to clear land. While some landowners have cited environmental concerns, others have claimed that nearby renewable projects are lowering their property values.

Jessica Karlsruher, the coalition’s executive director, cited the case of a landowner near the town of Waco whose property will eventually be surrounded by a solar farm. “That is not a NIMBY issue. That [solar project] has changed the way she wanted to steward her land,” Karlsruher said. “We wanted to see if we could do something about putting up guardrails.”

Yet major environmental groups in Texas have opposed the bill, saying it unfairly targets renewable energy in a state where oversight of the oil, gas and petrochemical industries is lax. A state government review last year found the Texas Commission on Environmental Quality’s leaders have become “reluctant regulators,” and, rather than emphasizing enforcement, its policies encourage “industry members to self-govern and self-police.”

“This feels like weaponizing regulations,” said Adrian Shelley, director of the advocacy group Public Citizen’s Texas office. “If the bill’s author were serious about this, she’d be applying it to all sources of energy.”

The renewable energy industry’s lagging political support might seem surprising in a state where wind and solar projects have proliferated. The U.S. Energy Information Administration projects that Texas will get almost 40 percent of its power this year from carbon-free sources.

But Nathan Jensen, a government professor at the University of Texas at Austin, said the industry, as a whole, has not excelled at coalition-building either within the business community or among environmental groups. He also noted that some wind and solar developers have been bad neighbors, barely communicating with nearby property owners and aggressively pursuing tax breaks.

“A lot of people thought that as you build out wind and solar and it becomes mainstream, their political power is going to increase dramatically,” Jensen said. “And this is a point in contrast.”

Other bills that have made it through the Texas Senate and are pending in the House would increase Texas’s use of natural gas. One measure calls for spending taxpayer dollars to build a fleet of new gas-fired power plants — it has the backing of Warren Buffett’s Berkshire Hathaway Energy.

Another would replace the state’s multibillion-dollar corporate tax break program with a new version that excludes wind and solar energy projects, preventing them from taking advantage of the incentives. Lawmakers in the House approved the measure last week. Lt. Gov. Dan Patrick (R) had championed the change, claiming that most of the benefits were going to the wind industry.

Renewable energy advocates said this package of bills could bring the industry’s growth to a sudden halt.

In 2023, for the second year in a row, the EIA expects Texas to lead the nation in solar power growth by installing roughly 7.7 gigawatts of new capacity — beating California’s expected 4.2 gigawatts. Its wind industry, which has been steadily expanding for more than a decade, is expected to lead the United States as well in new development.

While this rapid expansion has angered some rural landowners, it has benefited others eager to lease their property. It has also boosted local governments’ tax revenue.

For years before the wind industry came to town, the Robert Lee Independent School District in West Texas was operating out of a 1954 building with asbestos tiles and no air conditioning, said Aaron Hood, the district’s superintendent. But as wind turbines began to dot the landscape, and the local tax base increased, the district of about 280 students was able to issue a bond to pay for a new school building.

“Wind and solar have been really the only economic development that exists in our area. Samsung and Tesla are not going to come to West Texas,” said Hood. As president of the Texas Association of Rural Schools, he worries that other small school districts poised to benefit from the state’s solar boom may not be able to cash in if lawmakers pass the slate of bills.

“Without these projects coming to Texas, they would have no hope of any true increase in revenue,” he said.

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Image: Wind turbines dot the landscape in Waverly, Kansas./Editing by Germán & Co

‘Over Our Dead Bodies’: Backlash Builds Against $3 Trillion Clean-Energy Push

Ballooning size of wind and solar projects draws local ire as they march closer to populated areas

WSJ TODAY

LAWRENCE, Kan.—The federal government has ignited a green-energy investment spree that’s expected to reach as high as $3 trillion over the next decade. The road to spending that money, though, is increasingly hitting speed bumps from the likes of Gerry Coffman.

About an hour southwest of Kansas City, she turned down a wind lease last year on a farm that has been in her family since 1866. Someone knocked on her door a few months later, paperwork in hand, and offered $6,000 to hang a wind-power transmission line across her land. If she agreed to store construction equipment, she stood to make an additional $4,000. Ms. Coffman said no.

Ms. Coffman rotates corn and soybeans and has cattle pasture on her part of the family farm, which includes a wooded ribbon of water called Eight Mile Creek. Ms. Coffman doesn’t want to see native forest or prairie disturbed and thinks the industrial nature of towering wind turbines would change the community for the worse if a proposed project were built. 

“A year ago we were a nice, quiet neighborhood,” said Ms. Coffman, who has attended a series of contentious public meetings over several months as the county considers revising regulations for wind-energy development.

County-by-county battles are raging as wind and solar projects balloon in size, edge closer to cities and encounter mounting pushback in communities from Niagara Falls to the Great Plains and beyond. Projects have slowed. Even in states with a long history of building renewables, developers don’t know if they can get local permits or how long it might take. 

In Kansas, wind power grew rapidly for two decades and supplies around 45% of the electricity generated in-state, ranking it third in the nation. But at least five counties in more-populous eastern Kansas have recently placed moratoriums or bans on new wind or solar projects, joining 18 others that already restricted wind development to preserve the tallgrass prairie ecosystem. Kansas lagged behind nearly every state in large project construction and new clean power capacity last year, according to the American Clean Power Association, an industry group for wind, solar and battery storage.

President Biden’s signature legislative accomplishment, the Inflation Reduction Act, aims to make the nation’s electric grid and fuel industries cleaner. Companies have already announced plans for $150 billion in investment in renewables and battery storage in the eight months following the law’s passage, according to the American Clean Power Association. 

Potential private investment over the next decade spurred by federal tax incentives and loans could include $900 billion in renewable-energy projects and $100 billion in battery storage, according to Goldman Sachs. Adding investments in such areas as carbon capture and electric vehicles, total spending could reach $3 trillion, the firm estimates. 

Eight Mile Creek runs through Gerry Coffman’s farm in rural Douglas County, Kansas, where opponents are rallying against wind power.

Ms. Coffman, whose farm has been in the family for 150 years, worries that towering wind turbines would change the community for the worse.

The U.S., though, is a patchwork of state and local governments with different rules on development, and opposition to projects has mounted for myriad reasons. Increasingly, many communities are concerned that the rapidly expanding size of wind and solar farms will irreparably alter the complexion of where they live.

In a pattern familiar across the U.S., Kansas wind developers years ago snapped up the rights to tracts of rural land in the less-populous western part of the state. That filled capacity on large transmission lines that deliver electricity over long distances, pushing newer projects east into more-populous areas such as Douglas County, a place where many people commute to jobs in Kansas City and Topeka and large farms are interspersed with smaller plots.

Market demand and economies of scale have pushed solar and wind farm size to hundreds or thousands of acres. They may not sit on contiguous parcels, but instead spread throughout a community, increasing the odds of friction. 

In Michigan, a typical solar project once covered 60 acres but now would take up 1,200, said Sarah Mills, a senior project manager at the University of Michigan’s Graham Sustainability Institute. Ms. Mills said they may need to get smaller—and more expensive—to be more socially acceptable. A refrain emerging at community meetings she attends is, “What you’re asking our rural community to host is way more than our fair share.”

Projects aren’t evenly distributed throughout the U.S. They are placed where the wind or sunshine is plentiful, or where state policies have required the addition of renewables. Wind farms are concentrated in the Great Plains, Midwest and Texas, while solar is clustering in the West, Southeast and Northeast.

The National Renewable Energy Lab has tracked more than 2,000 local wind ordinances and 1,000 solar ordinances that outline rules for development such as project size. Figuring out whether regulations bar or allow development can be tricky, as bans aren’t always explicit—communities can create rules that amount to de facto denials—but the landscape changes each time developers cross a county line.

“It can be very localized,” said Rebecca Kujawa, president and CEO of NextEra Energy Resources. “It can be one county where a couple of stakeholders are very vocal and literally right over the border they’re very receptive.”

In Iowa, which has the second-highest installed wind power capacity in the country after Texas, a 2022 study of wind ordinances found that 16 of 99 counties had prohibitive rules or a ban against new projects, most of them approved in the previous four years. Between moratoriums and requirements for setbacks between turbines and things such as neighboring property lines, roads or buildings, developers won’t even consider projects on around half to three quarters of land with good wind resources, according to a study by the nonprofit research firm ClearPath and consulting group LucidCatalyst. 

Despite soaring demand and available capital even before the Inflation Reduction Act was passed, U.S. clean power installations dipped 16% last year and 12% over 2020, according to the American Clean Power Association. It was the worst year for land-based wind installations since 2018.

Many projects will eventually get built, say developers and analysts, but they could take longer and cost more than expected. At the federal level, there is some bipartisan support for speeding up permitting for transmission or pipeline projects, and Sen. Joe Manchin, a West Virginia Democrat, has relaunched a legislative effort that stalled last year. Some states are pushing back on their own against local roadblocks.

New regulations in New York give the state project-siting authority when conflicts arise over what it considers unreasonably burdensome local rules, part of an effort to add more renewable energy to the grid. Illinois has a similar effort: A new law says local rules can’t be more stringent than those the state sets.

In Cambria, N.Y., near Niagara Falls, a proposed 900-acre solar project across several parcels of land would neighbor around 350 residents, said town supervisor Wright Ellis. The town opposes the project, but likely cannot halt it. 

“We are not against solar,” Mr. Ellis said. “It’s the industrial size.”

That doesn’t mean the process is swift, though. The Cambria solar project was first proposed in 2017.

Landowner John Ohol, 44, wants to lease his property for the solar farm but fears further delays as the developer and township wrangle in court over the state’s draft permit. His family had a dairy farm in Cambria for 90 years, but he believes solar would be a more secure income stream. It is unrealistic for the community to expect that nothing would ever be developed on the property, Mr. Ohol said.

The developer says the site is ideal for solar. “Running right through our project site are two to three very large transmission lines,” said Keith Silliman of Cypress Creek Renewables. “That’s the A-number one reason that we’re there.”

New York has ambitious plans to have 70% of its electricity produced by renewables by 2030. Around 32% of New York’s electricity in 2021 came from renewables, most of it from longtime hydropower plants that would be difficult to impossible to build today. 

Adding more renewables has been slow so far. New York added just 262 megawatts of large wind and solar projects in 2022, less than Montana and South Dakota, according to the American Clean Power Association.

The Douglas County Board of Commissioners held a hearing in February on a request by NextEra Energy to put up a meteorological tower and other equipment.

Many Douglas County landowners object to renewable energy projects, which they say will harm local businesses, wildlife and property values.

On a cold February night in Kansas, Douglas County residents filed into dark wooden pews in the county courthouse and waited turns at the microphone. The meeting was focused on permits for a meteorological tower and other weather measurement equipment that is needed for  wind projects. The applications from power company NextEra Energy drew so much opposition that the meeting stretched four hours.

“Do you see the wounds that are being caused?” asked Debbie Yarnell, who owns a cow and sheep farm.

NextEra declined to comment on the meeting or its plans in Douglas County, but Chief Executive John Ketchum said in an interview in March that the company tries to do community outreach on the benefits of renewable energy and has an early-state development team that identifies places that would both welcome projects and have a good solar or wind resource. 

“The one thing we do that is really, really hard to do in this country is create economic development opportunities for rural communities,” Mr. Ketchum said. 

Alan Anderson, vice chair of the Polsinelli law firm’s national energy practice, represented the company at the Kansas meeting. He has traversed the state for such meetings for the last 15 years. The mood changed around 2015 when one of Mr. Anderson’s clients called and said they had been turned down for a meteorological tower, which until then had received routine approvals.

“It was the first of what became a pretty constant onslaught of challenges to projects,” said Mr. Anderson, who attributes the change to the conversation shifting from renewables as an economic boost to political debates and misinformation.

Some opponents don’t like the idea of locally produced energy getting exported out of the state, or that the government is singling out particular technologies for special tax treatment. Other objections are more tangible. Communities often complain about the rhythmic blinking red lights that flash atop turbines at night or the whooshing noise of blades. They also raise concerns about taking farmland out of production or the impact on wildlife.

Plenty of Kansans do want to host projects—wind is already the biggest source of electricity in the state, followed by coal at 35%, according to government data. Supporters view energy exports as akin to shipments of products like wheat or beef, and point to the amount of the corn crop that is grown for ethanol. 

The state’s residential electricity prices have generally been at or below the national average, while low-cost wind production drives down wholesale power prices, according to government and grid operator reports.

Many Kansans are girding for a long fight over this and future projects. Michael Forth helped start an opposition group which gained 1,200 petition signatures from residents who own a collective 40,000 acres. He traces his Douglas County family farm back to 1904 and moved back seven years ago from Colorado and built a house. “I’m wondering if I didn’t make the biggest mistake of my life,” he said.

Mr. Forth’s sister, Laurie Shuck, recently purchased a stack of “no trespassing” signs to post around her fences to try to keep out NextEra representatives offering wind leases or transmission easements. One late afternoon as light faded at her farm, the moon rose in the east and a flock of geese honked overhead. She paused to watch. Mrs. Shuck said she and her brother would lease land for wind projects, “over our dead bodies.” 

 “I was here first,” she said, and walked to feed her horses.

Michael Forth and his family have owned land in Douglas County since 1904. He moved back seven years ago, but with the influx of renewable-energy projects, said, ‘I’m wondering if I didn’t make the biggest mistake of my life.’

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Source: Media

EU targets Central Asia in drive to stop sanctioned goods reaching Russia  

Several EU countries fear Brussels risk opening a Pandora’s box with a new measure that could eventually be used against China and Turkey.

POLITICO EU BY BARBARA MOENS, LEONIE KIJEWSKI AND SUZANNE LYNCH, MAY 8, 2023 

Central Asian countries such as Uzbekistan and Kazakhstan are the most likely first targets of a radical new EU proposal to stop Russia busting sanctions by importing the high-tech components required to wage war through its neighbors.

The EU is moving toward its 11th package of sanctions against Russia to try to sap President Vladimir Putin's military machine and, for the first time, its proposal will include counter-measures against countries helping Moscow dodge Brussels' trade embargo. China and Turkey are the nations most often credited with throwing Russia an economic lifeline — but EU diplomats cautioned that Ankara and Beijing were not their immediate targets, and that measures against such significant geostrategic trade partners risked backfiring.

Instead, three EU diplomats said the hope was that the EU's impending proposals on sanctions circumvention would encourage Central Asian states to fall into line. The full 11th sanctions package could be unveiled as early as Tuesday, when European Commission President Ursula von der Leyen visits Kyiv to mark Europe Day.

EU sanctions envoy David O’Sullivan has traveled to Turkey, Uzbekistan and Kazakhstan in recent weeks in a bid to gauge the scale of sanctions circumvention.

Under the proposal for the 11th package, seen by POLITICO, the Commission wants to target “persons and entities circumventing the Union’s restrictive measures by activities which have the aim or result of frustrating the prohibitions in those measures. This concerns, for example, companies established in third countries, which obtain goods subject to restrictions from companies established in the Union and which are then supplied to Russia, directly or through intermediaries.”

Significantly, no specific countries or products are named in the two annexes to the proposal — instead it will be up to EU countries to make that decision. In addition to the new proposal, the 11th sanctions package also currently includes listings of 72 individuals and 31 entities.

The central plank of this new EU measure would be to restrict European companies from selling sensitive goods to one of Russia's neighbors if there were circumvention. The sanctions would first list sensitive products in terms of circumvention, then the countries where they are being shipped.

EU ambassadors will offer their first impressions on the proposal on Wednesday. EU diplomats don’t expect a deal on the new package until next week, or even the week after. The Kazakh and Uzbek embassies to the EU did not have an immediate response.

Not so fast

But that doesn’t mean the anti-circumvention measures will win a quick sign-off.

Several EU countries fear Brussels risks opening a Pandora’s box with the proposal. By establishing the principle that countries who breach EU sanctions, deliberately or not, could be targeted, the move opens up the possibility that other countries such as Turkey or China could be next in the firing line.

One EU diplomat seeking a tougher line on the bigger targets said he was "hoping for a loaded gun on the table, but right now the gun isn't even loaded."  

The U.S. has been pushing Brussels to take a more hawkish line on China but the EU is reluctant to further alienate Beijing. 

Similarly, confronting Turkey is also seen as a major political risk, given the volatility of Turkish politics as it approaches this weekend’s election, and Ankara’s leverage when it comes to issues like migration, given that Turkey has long acted as a buffer between the EU and the Middle East. 

While the Commission believes the threat of punishing Central Asian countries will be enough of an economic stick to change their behavior, one diplomat said Europe “should be sure we are ready to follow through” with a threat before making it. Another diplomat said Brussels needs to find a balance between cracking down on sanction circumvention and maintaining economic ties with key trading partners such as Turkey or China.  

Beijing on Monday was already adamantly opposed to a separate EU measure in the 11th sanctions package, which targets seven Chinese companies suspected of sending prohibited goods to Russia either directly or through intermediaries. This direct targeting of the seven companies is distinct from the proposed broader circumvention measure to draw up specific lists of products that should not be sold from Europe to companies in countries neighboring Russia, which has not yet been approved.

China’s Foreign Ministry spokesman Wang Wenbin warned the EU not to go ahead. “We urge the EU not to go on this wrong path, otherwise China will take firm actions to safeguard our legitimate and lawful interests,” he said. 

But the Commission is confident that the circumvention package gives EU countries enough wiggle-room to apply the brakes if a proposed measure is seen as too politically sensitive. 

Under the proposal, every decision to add a product or country needs to be approved by all 27 EU capitals. 

This may help to get EU countries on board with the politically sensitive new idea; at the same time, it makes the procedure very burdensome, giving every capital a potential veto power.

Focusing minds has been the looming G7 summit in Japan later this month, where the group of the world’s strongest economies are expected to focus on strengthening sanctions on Russia and combatting circumvention. 

For Ukraine’s supporters, the new package to be considered by member states Wednesday is good news. “I'm satisfied with that [package] as long as the final decision has been made … All the sanctions which are harming the Russian war machine, we are supporting them,” Estonian Foreign Minister Margus Tsahkna told POLITICO.

Jakob Hanke Vela and Stuart Lau contributed reporting.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Augusto Pinochet, in full Augusto Pinochet Ugarte, (born November 25, 1915, Valparaiso, Chile—died December 10, 2006, Santiago), leader of the military junta that overthrew the socialist government of Pres. Salvador Allende of Chile on September 11, 1973. Pinochet was head of Chile’s military government (1974–90). During his dictatorial reign tens of thousands of opponents of his regime were tortured/Source Britannica.com/ Image: Media/ Editing by Germán & Co

Analysis: Chile’s constitution will struggle to escape Pinochet’s shadow

This result has made it easier for far-right candidates like Kast to win elections: "Kast, a lawyer and supporter of the terrible Pinochet regime.

REUTERS By Alexander Villegas and Natalia A. Ramos Miranda

SANTIAGO, May 8 (Reuters) - Chile's new constitution may end up looking a lot like the current text, which dates back to the Augusto Pinochet dictatorship - but without his name on it - after the political right took charge of the redraft process in a harsh nationwide electoral defeat for leftist President Gabriel Boric.

Chile's Republican Party, led by far-right firebrand Jose Antonio Kast, secured over a third of the national vote on Sunday to elect advisers to draw up the new constitution, a sharp shift from a progressive majority that led the failed first attempt.

The win for the right will likely set the foundations for a far more conservative rewrite of the neoliberal original text, which was credited for propelling decades of strong growth in the copper mining nation, but criticized for causing wide economic inequalities that sparked months of social justice protests in 2019.

"This is the right's best chance for people to pick a Pinochet constitution without Pinochet's signature," said Patricio Navia a political scientist at New York University.

"If it includes some upgrades and demands from the left, we're going to have a constitution very similar to Pinochet's, but signed by Gabriel Boric and ministers of the Communist Party (part of the governing coalition)."

Boric, a former student protest leader, rose to power representing the Social Convergence Party on a hopeful mandate of reform, pledging to support a major progressive overhaul of the constitution. That process ended in failure last year when voters rejected the proposed new text.

Boric and progressives had called for a new democratic drafting process led by citizens with a focus on Indigenous and minority rights, powers of collective bargaining, water and land rights, as well as healthcare, education and pension reforms.

This time around, Boric's approval rating has fallen amid concerns about inflation and insecurity.

"The political climate in Chile isn't the same as in 2019 or 2020," said political analyst Cristobal Bellolio. "After a pandemic, and amid an economic and security crisis, people are favoring options that reduce uncertainty."

That's opened the door to far-right politicians like Kast, a lawyer who lost to Boric in the 2021 presidential elections and has defended the legacy of the brutal Pinochet dictatorship. An estimated 3,200 Chileans were murdered and another 28,000 tortured by the state during Pinochet's rule. Many of the victims were affiliated with the socialist government of Salvador Allende, who was deposed in a 1973 coup.

Kast's party won 23 of 50 seats on the new constitutional council, while a separate coalition of conservative parties won 11 seats. With a three-fifths majority needed to pass new articles, the right could push things through on its own.

Analysts said, however, that the right would likely agree to some changes to appease voters, including on areas like expanded social rights, consumer protections and Indigenous recognitions.

"The issue is that if it's more right then Pinochet's constitution, people are going to reject it," Navia added, who added the loss for Boric left the leader who once promised to bury Chile's market-led model sorely wounded.

"Boric said that if Chile was the cradle of neo-liberalism, it would also be its grave. But neo-liberalism is still healthy and now Boric is in the ICU," he said.

The loss comes weeks after Boric presented his most-recent ambitious proposal to take control of the country's lithium industry and create a new national lithium company. The plan already faces technical and political challenges as a key part must pass through Congress.

Rossana Castiglioni, a political science professor at Diego Portales University in Chile, said she was surprised by the low support for centrist parties and high number of null and blank votes, saying it was a message for progressives in the region.

"It's not enough to win an election, what happens in between is very important," Castiglioni said, adding that the economic landscape was very different than a previous leftist tide in Latin America during the economic boom of the early 2000s.

"The lesson is that there has to be a strategic adaption on the left if it wants to win elections in contexts were the economy is more adverse."

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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A Nasa satellite image of methane plumes east of Hazar, Turkmenistan, in October 2022. Photograph: Nasa/JPL-Caltech/AFP/Editing by Germán & Co

‘Mind-boggling’ methane emissions from Turkmenistan revealed

Leaks of potent greenhouse gas could be easily fixed, say experts, and would rapidly reduce global heating

The Guardian by Damian Carrington Environment editor, Tue 9 May 2023 

Methane leaks alone from Turkmenistan’s two main fossil fuel fields caused more global heating in 2022 than the entire carbon emissions of the UK, satellite data has revealed.

Emissions of the potent greenhouse gas from the oil- and gas-rich country are “mind-boggling”, and an “infuriating” problem that should be easy to fix, experts have told the Guardian.

The data produced by Kayrros for the Guardian found that the western fossil fuel field in Turkmenistan, on the Caspian coast, leaked 2.6m tonnes of methane in 2022. The eastern field emitted 1.8m tonnes. Together, the two fields released emissions equivalent to 366m tonnes of CO2, more than the UK’s annual emissions, which are the 17th-biggest in the world.

Methane emissions have surged alarmingly since 2007 and this acceleration may be the biggest threat to keeping below 1.5C of global heating, according to scientists. It also seriously risks triggering catastrophic climate tipping points, researchers say.

The Guardian recently revealed that Turkmenistan was the worst in the world for methane “super emitting” leaks. Separate research suggests a switch from the flaring of methane to venting may be behind some of these vast outpourings.

Flaring is used to burn unwanted gas, putting CO2 into the atmosphere, but is easy to detect and has been increasingly frowned upon in recent years. Venting simply releases the invisible methane into the air unburned, which, until recent developments in satellite technology, had been hard to detect. Methane traps 80 times more heat than CO2 over 20 years, making venting far worse for the climate.

Experts told the Guardian that the Cop28 UN climate summit being hosted in the United Arab Emirates in December was an opportunity to drive methane-cutting action in Turkmenistan. The two petrostates have close ties and there is pressure on the UAE to dispel doubts that a big oil and gas producer can deliver strong outcomes from the summit.

Tackling leaks from fossil fuel sites is the fastest and cheapest way to slash methane emissions, and therefore global heating. Action to stem leaks often pays for itself, as the gas captured can be sold. But the maintenance of infrastructure in Turkmenistan is very poor, according to experts.

‘Out of control’

“Methane is responsible for almost half of short-term [climate] warming and has absolutely not been managed up to now – it was completely out of control,” said Antoine Rostand, the president of Kayrros.

“We know where the super emitters are and who is doing it,” he said. “We just need the policymakers and investors to do their job, which is to crack down on methane emissions. There is no comparable action in terms of [reducing] short-term climate impacts.”

Super-emissions from oil and gas installations were readily ended, Rostand said, by fixing valves or pipes or, at the very least, relighting flares: “It’s very simple to do, it has no cost for the citizen, and for the producers, the cost is completely marginal.”

The satellite data used by Kayrros to detect methane has been collected since the start of 2019 and Turkmenistan’s overall emissions show a level trend since then. Satellites have also detected 840 super-emitting events, ie leaks from single wells, tanks or pipes at a rate of a few tonnes an hour or more, the most from any nation.

Most of the facilities leaking the methane were owned by Turkmenoil, the national oil company, Kayrros said. Further undetected methane emissions will be coming from Turkmenistan’s offshore oil and gas installations in the Caspian Sea, but the ability of satellites to measure methane leaks over water is still being developed.

Kayrros also did some high-resolution monitoring of the North Bugdayly field in western Turkmenistan. The number of super-emitter events there doubled to almost 60 between 2021 and 2022, with one recent super-emitter pouring out methane for almost six weeks.

Turkmenistan is China’s biggest supplier of gas and is planning to double its exports to the country. Until 2018, Turkmen citizens had received free gas and electricity. However, the country is also very vulnerable to the impacts of the climate crisis, with the likelihood of severe drought projected to increase “very significantly” over the 21st century and yields of major crops expected to fall.

‘Huge opportunity’

Speaking freely about the repressive and authoritarian state is difficult but sources told the Guardian it was a “very depressing” situation, with Turkmenistan probably the worst country in the world in dealing with methane leaks.

They said preventing or fixing the leaks represented a “huge opportunity” but that the lack of action was “infuriating”. Turkmenistan could stop the leaks from ageing Soviet-era equipment and practices, they said, and the country could be the “world’s biggest methane reducer”. But the huge gas resources on tap meant “they never cared if it leaked”.

It was also not a priority for the president, Serdar Berdimuhamedov, they said, without whose approval little happens. This is despite Berdimuhamedov, then deputy chair of the cabinet of ministers, telling the UN climate summit Cop26 in Glasgow in 2021 that Turkmenistan was reducing greenhouse gas emissions “by introducing modern technologies in all spheres of the state’s economy”, with “special attention” to the reduction of methane emissions.

Turkmenistan’s president, Serdar Berdimuhamedov, at his inauguration ceremony in Ashgabat, Turkmenistan, in March 2022. Photograph: AP

Berdimuhamedov also welcomed the Global Methane Pledge (GMP) to cut emissions, but Turkmenistan has failed to join the 150 nations now signed. Neither are Turkmenoil and Turkengas, the state companies, members of a voluntary UN initiative to cut leaks, the Oil and Gas Methane Partnership 2.0 (OGMP2), which covers about 40% of global oil and gas production. “The president hasn’t followed up,” said a source.

Largest hotspot

Recent scientific research, published in the journal Environmental Science and Technology, found that the west coast of Turkmenistan was “one of the largest methane hotspots in the world”.

Detailed analysis of satellite data revealed 29 different super-emitter events between 2017 and 2020, although older satellite data showed that “this type of emission has been occurring for decades”.

The researchers said 24 of the 29 super-emitter events came from flare stacks that had been extinguished and were then venting methane directly into the air, and that all were managed by state companies. The other five were linked to pipeline leaks. The scientists said that “the more frequent emitters would conflict with Turkmen law, which bans continuous gas flaring and venting”.

“Flaring is very easy to identify from the flame itself,” said Itziar Irakulis-Loitxate, of the Universitat Politècnica de València in Spain, who led the study. “But venting was something that you could not identify easily until two years ago.” The switch to venting, a far worse environmental practice, was “mind-boggling”, according to another expert.

The scientists said the prevalence of venting “points to the risks of penalising flaring without effective measures to control venting”. The World Bank founded a global initiative to end flaring in 2015.

‘Forcing mechanism’

The UN climate summit in December represented an opportunity for change, sources said, as it is being hosted by the UAE, which has strong links with Turkmenistan and expertise in oil and gas production. The most recent visit by Sheikh Mansour bin Zayed, the UAE’s deputy prime minister, to Turkmenistan was in February. He met Berdimuhamedov and discussed with him bilateral cooperation “in vital sectors such as oil and gas”.

The UAE is a member of the Global Methane Pledge and the state oil company, Adnoc, is a member of the OGMP2. Adnoc recently announced a partnership to develop a “supergiant gas field” called Galkynysh and other energy projects in Turkmenistan. However, Adnoc did not respond to a request for information on how the company would help limit methane emissions in the country.

The Guardian understands diplomatic efforts are being made to urge Turkmenistan to cut its methane emissions. “We are really hoping Cop28 is a forcing mechanism,” a source said.

The Guardian contacted Turkmenoil, Turkmengaz, the Turkmenistan ministry of foreign affairs and the Turkmen embassy in the UK for comment, but none responded.

News round-up, May, 8, 2023

Monday's thoughts

Waking up hopeless in a world where bad news rains down is a nightmare.

The article published by this blog in September 2022 named: “Beware of starving the enemy of oxygen …, was one of the first pieces of media to analyze China's potential role in the current war between Russia and Ukraine from a historical perspective.

…”  Following the conclusions of the bilateral meeting between the republics of China and Russia within the framework of the meeting of the Shanghai Cooperation Organization in the city of Samarkand in the Republic of Uzbekistan on September 16 of this year, the dangers of the current Russian military invasion of Ukraine have deepened....  As a result of the cautious position of the forgotten ally of the West during the Second World War, China, after the conclusion of the meeting.  In a statement by President Vladimir Putin himself, he acknowledges and simultaneously understands China's concerns about the current conflict.  Obviously, for the president of the Russian federation, it must not have been easy to publicly acknowledge China's political stance concerning the present war labyrinth with threats of incalculable dangers in its escalation. (https://energycentral.com/c/og/beware-starving-enemy-oxygen)

Although it may be an illusion (and we hope not a dilution), news from today's issue of The Wall Street Journal, regarding the negotiations China is leading for a ceasefire between Russia and its allies against Ukraine and the rest of the world, gives a glimmer of hope.

It has been a slow, steady process in a world that has undermined the so-called normality stage brewing since the end of the Cold War.  It has also been a disruptive process, weakening the global political system and undermining its leaders' political management capacity to care for the most disadvantaged.  Adding to all this is the inflationary process of the 1970s that widened the inequality gap.  The 2008 recession and the volcanic social and economic upheaval (inflationary processes) in many regions of the world, first due to the pandemic and now to war, have contributed to disorientation and frustration, weakening the bonds of coexistence.  The world has changed so much, it is becoming increasingly difficult to envisage that we will ever be the same again.  How we live, work, and relate to each other has changed forever, and all we do is try desperately to adapt to the new reality.  It is difficult, but we can get through it together in a mean-spirited and polarised world.

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Most read…

U.S. and Allies Look at Potential China Role in Ending Ukraine War

An expected offensive by Ukraine is seen as paving way for negotiations with Russia

WSJ By Bojan Pancevski and Laurence Norman, May 7, 2023

China's return to global stage checked by national security focus

Since abandoning pandemic controls that would effectively close its borders after 2020, Beijing has recently launched several diplomatic and commercial actions that appear to contradict each other.

REUTERS By Yew Lun Tian and James Pomfret, TODAY

The ‘Peace Dividend’ Is Over in Europe. Now Come the Hard Tradeoffs.

Defending against an unpredictable Russia in years to come will mean bumping up against a strained social safety net and ambitious climate transition plans.

NYT By Patricia Cohen and Liz Alderman, May 3, 2023

Israel to boost energy storage with eye on facilitating Sabbath supplies

Globally, there is a growing need for stored energy to utilize solar power at night and support the transition to electricity-powered transportation.

Reuters, NOW

In Germany, the construction of the Northvolt battery factory is under threat from US subsidies

The Swedish battery developer is considering abandoning their plans to build a factory in northern Germany to instead build it in the United States where subsidies for decarbonized industrial projects are more favorable.

Le Monde By Cécile Boutelet,  April 27, 2023. 

Climate Activists Have a New Target: Civilians…

On The Street Whit The Suv- Busting: Tire Extenguisher

POLITICO EU BY KARL MATHIESEN, MAY 2, 2023 

Chile: Far right ahead in key vote for new constitution

It was a major defeat for Chile's center-left president, Gabriel Boric, with the vote also widely viewed as a referendum on his government.

Le Monde with AP, TODAY

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Chinese leader Xi Jinping and French President Emmanuel Macron met in China last month. PHOTO: JACQUES WITT/PRESS POOL/ Editing by Germán & Co

U.S. and Allies Look at Potential China Role in Ending Ukraine War

An expected offensive by Ukraine is seen as paving way for negotiations with Russia

WSJ By Bojan Pancevski and Laurence Norman in Berlin and Vivian Salama in Washington, May 7, 2023

Some U.S. and European officials said they believe that Ukraine’s planned spring offensive could pave the way for negotiations between Kyiv and Moscow by the end of the year, and that China could help bring Russia to the table.

The willingness to encourage negotiations and seek out a role for China in talks represents a shift in Western thinking, particularly in the U.S., which has been highly skeptical of any involvement for Beijing given China’s longstanding support for Moscow. Secretary of State Antony Blinken publicly expressed cautious optimism recently that Beijing could help defuse the conflict. 

The approach is based on the belief that neither side has the ability to continue fighting indefinitely, and that Beijing’s willingness to play a role in international peace talks should be tested, the officials said. Still, they remain uncertain about Russia’s willingness to negotiate a cease-fire under Russian President Vladimir Putin.

The interest in negotiations brings Washington in closer alignment with some European countries, which are eager to see the conflict end, or at the very least moderate in intensity, and have been the most intent on discussing some resolution this year. The U.S., the U.K. and other countries have been publicly saying that Ukraine should be supported as long as it takes to defeat Russia. 

“We have been clear that we will continue to support Ukraine as they defend their country from Russia’s unprovoked invasion, and that support will continue,” said Adam Hodge, a spokesman for the National Security Council. “Unfortunately, we see no signs that Russia is preparing to stop its attacks on the Ukrainian people. That’s why we are committed to continuing to help Ukraine protect its people against Russian aggression.”

French President Emmanuel Macron has been the most explicit in pushing Ukraine to seek negotiations with the Kremlin after the spring offensive. Officials at the White House and State Department have long maintained that all wars end at the negotiating table, but said that it will require a genuine interest on the part of Russia to approach any talks in good faith. The military aid dispatched to Ukraine is designed to put Kyiv in a stronger negotiating position.

Key U.S. officials on the National Security Council are in favor of negotiations, according to European officials, while the State Department and the Central Intelligence Agency have been more skeptical, eager to see how the offensive goes before pitching for a diplomatic off-ramp.

An NSC spokesperson disputed European accounts that there is division within the administration. The State Department and the CIA didn’t respond to a request for comment.

Senior officials in Paris and Berlin who are familiar with their leaders’ discussions with President Biden say they expect the White House to attempt to facilitate talks following the Ukrainian offensive’s anticipated gains.

The aim is for Ukraine to regain important territory in the south, a development that could be interpreted as a success even if Russia retains chunks of territory its forces have occupied.  

Olaf Scholz, the German chancellor, will host Ukrainian President Volodymyr Zelensky in Berlin this month on what is set to be his first trip to Germany since Russia invaded in February 2022. While Mr. Scholz won’t pressure Mr. Zelensky into talks, Mr. Biden is expected to signal to the Ukrainian leader that cease-fire talks might be opportune in the coming months, European officials said.

The push to negotiate comes in the midst of concern on both sides of the Atlantic that the scale of support provided by allies to Ukraine for the coming push will be hard to match in the future if the war grinds into a stalemate. The supply of ammunition is a key problem because Western industrial capacity has proven unable to meet its own demands while supporting Ukraine, several officials and industry leaders said.

A number of senior officials across European governments expressed concern about the high attrition rates of troops and materiel in Ukraine, whose population is less than one-third of Russia’s.

The European push for negotiations isn’t a consensus. Poland, the Baltic states, other smaller nations and some officials from the U.K. believe that Ukraine should be given the time it needs to make gains—even if the coming spring offensive doesn’t reshape the battlefield.

Russia faces challenges sustaining its war effort, which some believe could force it to the negotiating table. Testifying May 4 on Capitol Hill, Director of National Intelligence Avril Haines said U.S. intelligence agencies assess that Mr. Putin has little interest in negotiating a definitive settlement of the conflict and is still assuming that the West’s will to support Ukraine will erode over time. 

“We continue to assess that Putin most likely calculates that time works in his favor,” said Ms. Haines. 

She added that the Russian leader has probably scaled back his near-term goals in Ukraine of consolidating control in the east and south of the country and ensuring that Kyiv never joins the North Atlantic Treaty Organization. If Mr. Putin accedes to a “negotiated pause” in the conflict, she said, his goal might be to use the time to rebuild Russia’s forces for future offensive operations.

It couldn’t be determined what any sort of negotiations would look like, but officials in Paris and Berlin said they are interested in a broadly framed cease-fire agreement that would potentially involve China among its guarantors.

In February, China called for peace talks to end the war in Ukraine, outlining its plan in a 12-point document, and casting itself as a neutral mediator. 

That same month, Mr. Macron offered in private to Mr. Zelensky to host a peace conference in Paris to negotiate a cease-fire when Kyiv decides the time is right. Mr. Zelensky said he would only participate if Mr. Biden and Chinese leader Xi Jinping attended. 

“China will continue to promote negotiations for peace and make its own efforts for an early cease-fire and restoration of peace,” the Chinese Embassy in Washington said in a statement.

Mr. Macron and his officials, as well as other Europeans officials, have since prodded Beijing to play a constructive role in diplomacy. Those efforts culminated in Mr. Xi calling Mr. Zelensky in April for the first time since the war began, although officials briefed on the conversation said the call deflated hopes that the Chinese leader would shift away from supporting Russia and contained no clear commitments to uphold Ukraine’s demands. 

Mr. Xi, who made a high-profile visit in March to the Kremlin, where he expressed support for Mr. Putin, will soon dispatch an envoy to Kyiv. 

“It is too early to be able to say anything, and we are now waiting for Xi’s representative to arrive in Kyiv,” said a senior member of the Ukrainian government.

Nonetheless, key European leaders are now confident that China is eager to remain involved in eventual cease-fire negotiations, several European officials said.

That sentiment was echoed by Mr. Blinken. “In principle, there’s nothing wrong with that,” he said last week at a Washington Post forum. He added that if there are countries with significant influence “that are prepared to pursue a just and durable peace, we would welcome that. And it’s certainly possible that China would have a role to play in that effort.” Mr. Blinken also said he wasn’t sure that Beijing accepted the proposition that Moscow was the aggressor.

When would be the right time for Ukraine to hold peace talks with Russia? Join the conversation below.

Until recently, a number of U.S. and European officials were saying that China’s open support for Russia since the war began made Beijing unpalatable as a negotiating partner for ending the war.

Kyiv welcomes any country that can play a constructive role in their pursuit of peace, but didn’t believe Beijing was crucial, Ukraine’s ambassador to the U.S., Oksana Markarova, said recently.

Western leaders are now slowly moving toward a consensus that halting the conflict might be the best option, said Fiona Hill, a former National Security Council official responsible for Russian policy, now with the Brookings Institution.

“This seems to be where we are trending,” she said. “Freeze the conflict and stop the slaughter, because everybody would like this to stop.” 

Mr. Putin has shown no public sign of winding down the war or his objectives, despite mounting losses. Any durable arrangement will most likely involve Mr. Zelensky’s acceptance of occupation of Ukrainian territory by Russia, Ms. Hill said.

“Is it sufficient for Ukraine to have effectively given up territory and countless lives and to say, ‘OK, this is what we died for?’ ” Ms. Hill asked.

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A cutout depicting Chinese President Xi Jinping is on display outside a gift shop in Moscow, Russia May 3, 2023. REUTERS/Evgenia Novozhenina/ Editing by Germán & Co

China's return to global stage checked by national security focus

Since abandoning pandemic controls that would effectively close its borders after 2020, Beijing has recently launched several diplomatic and commercial actions that appear to contradict each other.

REUTERS By Yew Lun Tian and James Pomfret, TODAY

BEIJING/HONG KONG, May 8 (Reuters) - China's increasing focus on its own security and intensifying rivalry with the United States threatens to turn its re-engagement with the world after years of COVID curbs into a new era of isolation from the West, analysts say.

Since casting off pandemic controls that effectively shut its borders since 2020, Beijing has in recent months embarked on a series of seemingly contradictory diplomatic and business steps that have left many observers questioning its motives.

These have included: promoting peace in Ukraine while holding talks with the aggressor Russia, rolling out the red carpet to Western leaders while escalating tensions over democratic Taiwan, and wooing foreign CEOs while taking measures seen as stifling China's business environment.

Analysts say what may appear as mixed messaging is the result of President Xi Jinping's renewed focus on national security, steeled by rock-bottom relations with rival superpower, the United States.

"The stark reality in China...is that security now trumps everything, from economy to diplomacy," said Alfred Wu, associate dean, Lee Kuan Yew School of Public Policy in Singapore.

Wu said the overwhelming focus on security is hurting some of China's diplomatic ties and its plans to rejuvenate the world's second largest economy, even as it seeks to stamp its authority on key geopolitical issues including the Ukraine crisis.

"For all that China says about wanting to be open to the outside world, it has progressively closed up."

Xi singled out national security, a broad concept incorporating issues ranging from politics and economics to technology and territorial disputes, in a speech after securing a precedent-breaking third leadership term in October.

A later speech in March at the National People's Congress was more pointed: China's security is being challenged by U.S. attempts to contain its rise, he said.

While national security has always been among Xi's top concerns since taking office in 2012, his first two terms focused more on domestic issues like dissidents, rights activists and Muslim ethnic groups in China's northwestern Xinjiang region.

In his October speech, he added "external security" and "international security", in what analysts say signals a new focus to counter foreign threats, namely Washington.

Asked for its response to a list of questions for this story, China's foreign ministry said it was "not aware of the situation".

Ministry officials have repeatedly asserted that China is a responsible power that supports multilateralism and globalisation and have accused other countries of hyping up the "China threat".

'DIVERGENCE UNDERNEATH'

But China's obsession with security has tainted several of its recent diplomatic initiatives, say analysts.

For example, China's attempts to promote a peace plan for Ukraine has been met with scepticism due to its refusal to condemn Moscow, a close ally and its biggest oil supplier.

When Xi last month held his first call with Ukrainian President Volodymyr Zelenskiy since the war started more than a year ago - an effort to stress Beijing is not taking sides - several analysts cast it as "damage control" after China's ambassador to France questioned Ukraine's sovereignty.

Charles Parton, a fellow at British think tank Council of Geostrategy, said China's calls for peace in Ukraine are related to its own battle with the U.S.

"Beijing does not care if its peacemaking works...what matters is that this is an opportunity to portray the Americans in a bad light," he said, referring to China's assertions that the U.S. and its allies are fanning the flames of war by arming Kyiv.

Michael Butler, associate professor of political science at Clark University in Boston, said Ukraine was a litmus test for U.S. resolve with parallels for Taiwan, the democratically ruled island China claims as its own.

"Of particular concern to Xi is gauging the lengths to which the U.S. will – or won’t – go to defend Ukraine’s sovereignty from Russian aggression, while publicly positioning China as a sober voice of reason and the U.S. as a meddlesome aggressor," he said.

China's attempt to woo US allies in Europe is also part of its strategy to counter Washington's influence, but has had mixed success, say analysts.

They point to last month's meeting in China between Xi and French President Emmanuel Macron. What appeared to be a friendly, constructive encounter was marred by Beijing beginning war games around Taiwan hours after Macron left.

This, alongside comments by Macron perceived as weak on Taiwan, fuelled criticism of the trip in Europe as pandering to China. EU officials subsequently took a tougher line on China.

BUSINESS JITTERS

China's security focus also risks isolating the country economically.

At a pair of high-profile business summits in China in March, officials were at pains to stress the country was open for business after COVID.

But in recent weeks, China has also passed a wide-ranging update of its anti-espionage law and taken what the U.S. said was "punitive" action toward some overseas firms in China.

"The security forces in China seem to have been emboldened, at the same time that China seeks to attract more foreign investment," Lester Ross, the head of the American Chamber of Commerce’s China policy committee, told Reuters.

Chinese foreign ministry officials have previously said Beijing welcomes foreign firms as long as they abide by its laws.

Instead of optimism about China's reopening, decades-long foreign bullishness on its capital markets is breaking down, with China's rivalry with the U.S. topping investor concerns.

Ray Dalio, the founder of one of the world's biggest hedge funds Bridgewater and a high profile Sinophile, is among those concerned.

"(China and the U.S.) are very close to crossing red lines that, if crossed, will irrevocably push them over the brink into some type of war that damages these two countries and causes damage to the world order in severe and irrevocable ways," Dalio, who retired earlier this year, recently wrote on his personal LinkedIn account.

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Image: The Brandenburg Gate in Berlin. Last year, military spending in Europe had its biggest annual rise in three decades, the Stockholm International Peace Research Institute reported.Credit...Patrick Junker for The New York Times / Editing by Germán & Co 

The ‘Peace Dividend’ Is Over in Europe. Now Come the Hard Tradeoffs.

Defending against an unpredictable Russia in years to come will mean bumping up against a strained social safety net and ambitious climate transition plans.

NYT By Patricia Cohen and Liz Alderman, May 3, 2023

*Patricia Cohen covers the global economy from London, and Liz Alderman the European economy from Paris.

In the 30 years since the Iron Curtain came crashing down, trillions of dollars that had been dedicated to Cold War armies and weapons systems were gradually diverted to health care, housing and schools.

That era — when security took a back seat to trade and economic growth — abruptly ended with Russia’s invasion of Ukraine last year.

“The peace dividend is gone,” Kristalina Georgieva, the head of the International Monetary Fund, recently declared, referring to the mountains of cash that were freed up when military budgets shrank. “Defense expenditures have to go up.”

The urgent need to combat a brutal and unpredictable Russia has forced European leaders to make excruciating budgetary decisions that will enormously affect peoples’ everyday lives. Do they spend more on howitzers or hospitals, tanks or teachers, rockets or roadways? And how to pay for it: raise taxes or borrow more? Or both?

The sudden security demands, which will last well beyond an end to the war in Ukraine, come at a moment when colossal outlays are also needed to care for rapidly aging populations, as well as to avoid potentially disastrous climate change. The European Union’s ambitious goal to be carbon neutral by 2050 alone is estimated to cost between $175 billion and $250 billion each year for the next 27 years.

“The spending pressures on Europe will be huge, and that’s not even taking into account the green transition,” said Kenneth Rogoff, an economics professor at Harvard. “The whole European social safety net is very vulnerable to these big needs.”

After the Berlin Wall fell, social spending shot up. Denmark doubled the money it funneled to health care between 1994 and 2022, according to the latest figures compiled by the Organization for Economic Cooperation and Development, while Britain increased its spending by more than 90 percent.

Over the same period, Poland more than doubled funding for culture and recreation programs. Germany ramped up investments in the economy. The Czech Republic increased its education budget.

Military spending by European members of North Atlantic Treaty Organization and Canada reached a low point in 2014 as the demand for battle tanks, fighter jets and submarines plummeted. After Russia annexed Crimea that year, budgets started to rise again, but most countries still fell well below NATO’s target of 2 percent of national output.

“The end of the peace dividend is a big rupture,” said Daniel Daianu, chairman of the Fiscal Council in Romania and a former finance minister.

Before war broke out in Ukraine, military spending by the European members of NATO was expected to reach nearly $1.8 trillion by 2026, a 14 percent increase over five years, according to research by McKinsey & Company. Now, spending is estimated to rise between 53 and 65 percent.

That means hundreds of billions of dollars that otherwise could have been used to, say, invest in bridge and highway repairs, child care, cancer research, refugee resettlement or public orchestras is expected to be redirected to the military.

Last week, the Stockholm International Peace Research Institute reported that military spending in Europe last year had its biggest annual rise in three decades. And the spendathon is just beginning.

The demand for military spending will be on display Wednesday when the European Union’s trade commissioner, Thierry Breton, is expected to discuss his fact-finding tour to determine whether European nations and weapons manufacturers can produce one million rounds of 155-millimeter shells for Ukraine this year, and how production can be increased.

Poland has pledged to spend 4 percent of its national output on defense. The German defense minister has asked for an additional $11 billion next year, a 20 percent increase in military spending. President Emmanuel Macron of France has promised to lift military spending by more than a third through 2030 and to “transform” France’s nuclear-armed military.

Some analysts argue that at times cuts in military budgets were so deep that they compromised basic readiness. And surveys have shown that there is public support for increased military spending, pointedly illustrated by Finland and Sweden’s about-face in wanting to join NATO.

But in most of Europe, the painful budgetary trade-offs or tax increases that will be required have not yet trickled down to daily life. Much of the belt-tightening last year that squeezed households was the result of skyrocketing energy prices and stinging inflation.

Going forward, the game board has changed. “France has entered into a war economy that I believe we will be in for a long time,” Mr. Macron said in a speech shortly after announcing his spending blueprint.

But the crucial question of how to pay for the momentous shift in national priorities remains. In France, for instance, government spending as a percentage of the economy, at 1.4 trillion euros ($1.54 trillion), is the highest in Europe. Of that, nearly half was spent on the nation’s generous social safety net, which includes unemployment benefits and pensions. Debt has also spiraled in the wake of the pandemic. Yet Mr. Macron has vowed not to increase what is already one of the highest tax levels in Europe for fear of scaring off investors.

Debates over competing priorities are playing out in other capitals across the region — even if the trade-offs are not explicitly mentioned.

In Britain, on the same day in March that the government unveiled a budget that included a $6.25 billion bump in military spending, teachers, doctors and transport workers joined strikes over pay and working conditions. It was just one in a series of walkouts by public workers who complained that underfunding, double-digit inflation and the pandemic’s aftermath have crippled essential services like health care, transportation and education. The budget included a $4.1 billion increase for the National Health Service over the same two-year period.

Romania, which has been running up its public debt over the years, has pledged to lift military spending this year by 0.5 percent of national output. And this month it agreed to buy an undisclosed number of F-35 fighter jets, which have a list price of $80 million a piece. While the increase will enable the country to hit NATO’s budget target, it will undercut efforts to meet the debt limits set by the European Union.

The shift in government spending is perhaps most striking in Germany, where defense outlays plunged after the reunification of the former East and West German nations in 1990.

“Defense was always the place to save, because it was not very popular,” said Hubertus Bardt, the managing director of the Institute of the German Economy.

Germany, the largest and most powerful economy in Europe, has consistently devoted less money to the military as a percentage of gross domestic output than either France or Britain.

It’s a “historic turning point,” the German chancellor, Olaf Scholz, said when he announced a special $112 billion defense fund last year. Yet that pot of money did not include any spending for ammunition. And when the fund is depleted, Germany will need to find an additional $38 billion to level up with its NATO partners.

Mr. Rogoff, the Harvard economist, said that most Europeans have not yet absorbed how big the long-term effects of a fading peace dividend will be. This is a new reality, he said, “and governments are going to have to figure out how to rebalance things.”

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An Israeli power distribution plant is seen in Hebron in the Israeli-occupied West Bank January 22, 2020. REUTERS/Mussa Qawasma/Editing by Germán & Co

Israel to boost energy storage with eye on facilitating Sabbath supplies

Globally, there is a growing need for stored energy to utilize solar power at night and support the transition to electricity-powered transportation.

Reuters, NOW

JERUSALEM, May 7 (Reuters) - Israel approved on Sunday a plan to create an energy storage network in cities to produce off-peak electricity, which will also supply "kosher" electricity for ultra-Orthodox Jews observing the Sabbath.

Demand for stored energy is on the rise worldwide as a way to use solar power at night and to help shift to electricity-based transport.

In Israel, with a new government that has strong religious representation, there is an added interest for ultra-Orthodox communities that strictly observe Jewish law, including restrictions on electricity use on Saturdays, the Jewish Sabbath.

Observant Jews do not turn on electric appliances on Saturdays, though systems like air conditioners or water heaters can be turned on beforehand and run throughout the day.

In some neighbourhoods generators are activated ahead of time and provide electricity for the day, which is expensive, polluting and can be dangerous, Israel's energy ministry says.

"Storing electrical energy will be one way to allow the expansion of electricity production from renewable energies," said the ministry. "At the same time, in Israel there are populations interested in consuming 'kosher electricity' that was not generated on Sabbath."

The government approved a pilot - a 24-megawatt battery facility - to store excess power from peak production times that will be drawn on by some 3,000 households in the city of Bnei Barak, an ultra-Orthodox enclave in central Israel.

It will be built by state-owned Israel Electric Corp for up to 120 million shekels ($33 million) and privatised after three years. If successful, hundreds of megawatts in storage facilities will be built nationwide, the ministry said, without giving a timeframe.

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Image: Picture taken on October 19, 2017 shows Northvolt's CEO Peter Carlsson during a press conference in Stockholm. ANDERS WIKLUND / AFP/ Editing by Germán & Co

In Germany, the construction of the Northvolt battery factory is under threat from US subsidies

The Swedish battery developer is considering abandoning their plans to build a factory in northern Germany to instead build it in the United States where subsidies for decarbonized industrial projects are more favorable.

Le Monde By Cécile Boutelet(Berlin (Germany) correspondent),  April 27, 2023. 

A few kilometers from the North Sea coast, standing on the moors of Schleswig-Holstein, Heide is one of those typical villages of Germany's northernmost state: a rural community, swept by the sea winds, where manufacturing has become rare.

For several months now, though, Heide has been at the heart of a battle that has become almost existential for "made in Germany:" The Swedish group Northvolt, which was planning to set up a huge car battery factory in Heide, is threatening to build it in the United States instead, mainly because the cost of electricity in Germany is too high.

If Heide were to be abandoned, it would be catastrophic for the German industrial site. A year ago, in March 2022, Berlin and the Schleswig-Holstein region celebrated the announcement of Northvolt's move to the region, which promised an investment of €4.5 billion and the creation of 3,000 jobs.

The Minister for Economic Affairs and Climate Change Robert Habeck was particularly pleased. A native of Schleswig-Holstein, where he was a regional minister, he has played a major role in making the region self-sufficient in green energy by developing an ambitious wind power program. It was the local abundance of renewable electricity that convinced Northvolt to locate in Heide. The vision of environmentalist Habeck was realized: It is possible to combine industry with carbon neutrality.

Intense negotiations

A few months later, Northvolt's boss, the Swede Peter Carlsson, dashed hopes of a rapid opening of the Heide plant. In the columns of the Frankfurter Allgemeine Zeitung in October, the 52-year-old founder and former Tesla executive explained that the highly anticipated factory project was now facing headwinds. The Inflation Reduction Act (IRA), which massively subsidizes projects for low-carbon technologies produced in the United States, has reshuffled the deck, as has the energy crisis caused by the war in Ukraine.

"With current electricity prices, we consider the profitability of energy-intensive projects in Germany to be at risk," said Carlsson. "We want to continue to be a European champion and market leader. But we are now at a point where it is possible that we will prioritize expansion in the US over Europe."

These statements chilled Berlin and triggered a phase of intense negotiations between the Swedish group and the German and European authorities, which is not yet over. But no decision has been taken, the Northvolt group confirmed to Le Monde. It hopes that the matter will be decided "in the course of the year." In practical terms, it is a question of knowing to what extent the Swedish group can benefit from the European response to the very attractive American subsidies, and above all, within what timeframe. Habeck continues to throw all his weight behind Heide's investment: He personally visited Northvolt's research center in Västeras, Sweden, in February 2023. "We continue to work on the Heide project," Carlsson said after the visit.

But the most sensitive matter remains the cost of electricity. Compared to the north of Sweden, the gap is huge. In Skelleftea, where Northvolt has been operating its first gigafactory since the end of 2021, "electricity from renewable sources is 3 cents per kilowatt hour," said Martin Höfelmann, spokesman for Northvolt in Germany. "In Germany, the price of electricity for industry is currently around 15 cents. About 5 cents would be required to make the plant profitable. There would also be the possibility of directly using locally produced surplus wind power, which the grid cannot absorb. But there are major administrative barriers to this solution," Höfelmann said.

Unattainable ambition

Heide is emblematic of the current dilemma of the European automotive industry. All carmakers are pushing their electric programs and urgently need batteries – ideally made in Europe – to reduce dependence on external suppliers. But this ambition seems increasingly unattainable. Volkswagen, the largest shareholder in Northvolt with a 20% stake, and which itself plans to build six battery factories, is not indifferent to the sirens of the IRA: in March, the group announced its intention to build its third gigafactory in Canada (which benefits from American subsidies) rather than in Slovakia as originally planned.

The debate reinforces concerns currently expressed by German imanufacturing, which gathered at the Hannover Fair this week, the world's largest industrial trade fair. "German competitiveness is eroding," said Siegfried Russwurm, president of the industry federation, at the opening of the meeting on Monday, April 17, in front of Chancellor Scholz. "We have reached a point where German companies are thinking twice before investing," he continued, pointing to high electricity prices as one of the main reasons for the current loss of market share for "made in Germany."

The trade unions deplore the already perceptible consequences of this development on industrial employment. According to a recent survey by IG Metall in Baden-Württemberg, almost every second automotive supplier is currently relocating jobs abroad, either to cut costs or to produce closer to the end customer, following the global trend away from free trade to relocating production.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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llustrations by Wayne Mills for POLITICO
Photos by Karl Mathiesen and Ina Fassbender/AFP 
Animation by Dato Parulava

Climate Activists Have a New Target: Civilians…

On The Street Whit The Suv- Busting: Tire Extenguisher

POLITICO EU BY KARL MATHIESEN, MAY 2, 2023 

BRUSSELS — Claude stood watch on the dark, glistening street as Samuel crouched down to jam a lentil into the tire valve of an SUV. “Of course, it will piss them off,” Claude said. An hour later, the vehicle would be slumped against the curb on a flat tire. By the end of the night, the Belgian cell of the Tyre Extinguishers — a loose collective of anarchic climate activists — would claim they had “disarmed” 194 SUVs across Brussels and nearby Ghent.

“We don’t want them to think that they can buy a big car and just enjoy their life and ignore what’s going on in the world,” Claude explained to me. He and his two accomplices gave false names as a condition of allowing me to observe their nighttime expedition. The vehicles weren’t damaged, but they’d need a refill or a tire change. Before he left, Claude stuck a leaflet to the windscreen saying, in French: “Don’t take it personally. You are not our target, it’s your car.”

If you live on planet Earth, you might have noticed that climate change activists have become increasingly annoying in recent years, splattering masterpieces with soup, halting football and tennis matches, shutting down highways and petrol stations and — in the case of the Tyre Extinguishers, who take their instructions from an anonymized website — claiming to have disabled more than 11,000 SUVs in 17 countries around the world.

I met up with Claude and his friends to witness a new development in climate activism. A small but significant wing of the green movement has crossed the Rubicon: It’s not just fossil fuel executives and politicians being targeted; for activists like Claude and those who support them, civilians are now fair game.

Claude and his fellow travelers see their actions as annoying, yes, but also part of an existential struggle — the next necessary step after exhausting normal democratic acts like voting, peaceful protests, lobbying and disinvestment. Western government officials may tout a recent surge in climate spending and legislation, but activists point to investments in coal plants or the expansion of oil and gas production as evidence that humanity is continuing to nurture its own apocalypse. “I don’t know how you can’t see it,” Claude told me. What are a few flat tires in the face of a potentially civilization-ending climate crisis?

“We need to wake up,” said Margaret Klein Salamon, executive director of the U.S.-based Climate Emergency Fund (CEF), which has channeled millions of dollars to 95 “disruptive activism” groups since it was set up in 2019. “I think of the activists as shaking us, trying anything that they can think of and putting themselves at very significant risk … but they’re doing it because they’re terrified.”

Attitudes like Claude’s are reinforcing a long-held view among some law enforcement officials, academics and parts of the green movement that this escalation was inevitable. If activists who view the world in increasingly millenarian terms really are done trying to win the public’s approval, what’s to stop these slightly goofy stunts from turning into something more serious? Cases of arson and sabotage are breaking into the news more often. Could more extreme forms of violence be next?

“The movement is getting more confrontational,” said Jamie Henn, a U.S.-based activist and organizer who co-founded the 350.org climate group in 2007. “Marching around with clever signs isn’t going to get Exxon to keep fossil fuels in the ground, so folks are finding other ways to apply pressure.”

“And then, you’ll always just have some young folks who want to fuck shit up,” he added.

‘How to blow up a pipeline’

There is a bit of cloak and dagger in arranging my meeting with the Tyre Extinguishers: hidden phone numbers, encrypted emails and code names. But Claude and his little gang aren’t hardcore militants — at least, not yet.

On the street, they take amateurish precautions, such as face coverings (which often slip down) or sharing a series of signals in case they spot cops or angry car owners. Claude also acknowledged that what they do could be “dangerous for people, because they could get in an accident.” The flyers he sticks to the windscreens serve not only as an explanation for the group’s actions but as a warning for people who might otherwise drive off on a flat tire. Cars with kids’ seats, disability stickers and medic tags get a pass.

The Tyre Extinguishers’ goal is to make SUV ownership socially toxic — to shatter it as a symbol of wealth, comfort and power. The massive vehicles are, after all, one of the largest drivers of carbon dioxide emissions growth. In 2022, they accounted for a record 46 percent of new car sales globally, according to the International Energy Agency. Their bulk makes them 20 percent less energy efficient than a regular car, and considerably more dangerous to pedestrians. The Tyre Extinguishers want to make them impossible to own, if only because you might wake up one morning and find your ride is neither pimped nor pumped.

The group’s website appears to be run by a British group that started taking credit for SUV hits up and down the U.K in 2021. It encourages anyone to steal its campaign: “We have no leader,” the site says. The idea itself is stolen — a reboot of the activities of a Swedish group, called the Indians of the Concrete Jungle, which claimed it had temporarily depressed SUV sales across the country in 2007.

One of the members of that group was Andreas Malm, an academic whose 2021 book “How to Blow up a Pipeline” galvanized a new wave of activists who want to go beyond protests and sit-ins and start attacking the machines that cause climate change. (A feature film based on the book debuted in the United States on April 7). In his book, which is more a manifesto than an instruction manual, Malm goads the mostly peaceful green movement for valuing nonviolence more than the urgent cause they’re fighting for.

Malm’s message has resonated with activists who have fallen out of love with marching. Greta Thunberg inspired school strikes that brought millions of young people into the streets between 2018 and 2020, but that is over. “Battling with that sense of defeat is part of where we’re at now,” said Dominika Lasota, a Polish activist and a leader of the Fridays For Future climate protest movement.

“COVID really knocked the wind out of the sails,” said Klein Salamon. “Earth Day 2020 was supposed to be the largest environmental demonstration in history. And instead, it was a live stream.”

Groups like the Tyre Extinguishers offer a relatively low risk on-ramp for involvement in what activists call “direct action.” There’s a solemn purpose, sure. But it’s also a night out — and a gleeful element to the lawless hijinks.

Roaming the streets of Uccle, an affluent southern Brussels suburb, Claude and his friends let out yelps of joy when they spotted a Tesla. No! Two Teslas! It wasn’t long before the battery-fueled cars were sinking hissing to their haunches.

The Tyre Extinguishers have rules on their website, outlining what should or shouldn’t be targeted. Hitting high-end electric vehicles is considered kosher, because of the harm caused by mining precious minerals for their batteries. Claude explained that big cars of all sorts were unacceptable. “It’s just rich people who pretend to believe in ecology,” he said of the Tesla owners. A few minutes later, just as he was labeling a windscreen, a man in a nearby house lurched to his palatial front window. The group fast-walked away, looking suspicious as hell.

A few streets over, it happened again. This time, with the likely owner of the targeted SUV glaring through his window just a few feet from my head, there was no time to stick the leaflet on the windshield. It was a breach of the safety procedure. But the group cut its losses and melted away to other parts of the city.

Any means necessary

The tension between nonviolence and militancy is as old as protest itself. Yet, amid the escalating climate crisis, the debate over how to confront the forces driving environmental destruction has taken on an existential urgency.

The big question hanging over groups like the Tyre Extinguishers is: If this ratcheting up of public irritation fails, will they, or others like them, take things further?

The iconic moment in this new spate of protest-by-annoyance took place last October, when two British activists from the Just Stop Oil group made international news by splattering cans of Heinz tomato soup across Vincent van Gogh’s “Sunflowers” at the National Gallery in London.

The resulting public fury wasn’t unexpected, said James Skeet, a spokesperson for the group. It was the point. “If you’re not getting millions of eyeballs, you’re not in the ballpark of achieving significant societal change,” he said. He noted that when the group attacked a series of oil terminals, the public paid almost no heed. A video of the act taken by Guardian journalist Damian Gayle has been viewed more than 50 million times on Twitter.

Orange is the chosen color of many of these groups: garish and impossible to ignore. On Monday, a Just Stop Oil protester launched himself onto the table at the World Snooker Championships in Sheffield showering himself in colored dust, like a worshiper at the Hindu Holi festival. The orange powder stained the green felt as the commentator intoned: “Terrible, terrible scenes here.”

By contrast, when the famously disruptive protest group Extinction Rebellion held a peaceful march in London last weekend, the media coverage was … crickets. “Disruption or Nonexistence,” mused Roger Hallam, one of the group’s founders, on Twitter. “Sometimes Life only gives you two options.”

Elsewhere, environmental demonstrations have already escalated. Recent protests in France against the construction of agricultural water reservoirs that critics say will unfairly favor corporate farms have included arson, sabotage and clashes between protesters and police. Claude, the Tyre Extinguisher, was present at a recent clash with the cops that left one activist in a coma.

In northwestern Germany, a long-running battle over the expansion of a network of coal mines has been the site of acts of sabotage and attacks on vehicles and police. In 2020, an excavator at a construction site owned by the energy company RWE was torched. In January, an anonymous poster on the left-wing blog indymedia.org declared that “two strategically placed incendiary devices” had disabled a coal train in Cologne. “Our action is part of a militant campaign … against global climate destruction,” the poster said. “RWE deserves nothing but our deepest hatred!”

RWE declined to comment on the post nor confirm that the attack had taken place, referring questions to the police.

A connection to climate activism is “likely,” said Andreas Müller, a spokesperson for the Aachen police. He confirmed incendiary devices were placed on RWE rail infrastructure but would provide no further details other than adding that no arrests had been made. “Some of the groups are under surveillance by the government,” he added.

A spokesman for the interior ministry of the German state of North Rhine-Westphalia described Ende Gelände as a “hinge” connecting far-left “extremist violent criminals” to a democratic protest movement. The government said it recorded 43 fire crimes, 25 dangerous interventions in rail traffic and 216 incidents of property damage around the coal mines between 2019 and 2022.

Ende Gelände has rejected the extremist label. But last week, in a tweet that was subsequently deleted, the group said it would be necessary to “abolish democracy” to tackle the climate crisis. In recent months, another group, Letzte Generation, has eclipsed both Fridays For Future and Ende Gelände as the noisiest, most disruptive force in German climate activism.

Many mainstream activists view groups like these as a force that can help the rest of the movement achieve its goals. Malm likes to point to how the U.S. civil rights leader Martin Luther King Jr. emphasized the threat posed by black militants like Malcolm X to push forward his cause. Suffragettes pushing for the right of women to vote not only marched; they smashed windows, attacked ballot boxes with acid and carried out a campaign of bombing and arson; one suffragette even attacked a young Winston Churchill, cutting his face with a dog whip.

“We should not forget that in the past, it is always through these movements of civil disobedience that the law and practice have been changed,” said Michel Forst, the U.N. special rapporteur for environmental defenders. “I met many young people who told me how they had decided to break the law because the emergency commanded it … I think it’s something that’s not illegitimate.”

Government response in the form of harsh anti-protest laws proposed in Italy and Britain has rallied support for activists from the wider left. In Germany, dozens of left-wing and green groups, including mainstream NGOs like BUND and Oxfam, signed a letter condemning the government for targeting Ende Gelände as extremist.

Crucially, more militant actions have not alienated the American philanthropic community that funds much of the global climate movement. Arguably, the tactics of groups like Ende Gelände, Letzte Generation and Just Stop Oil have made them even more attractive to a certain type of funder. The three organizations and eight others have banded together to form the A22 network, which has pledged constant “mass civil disobedience.” They are financed by the Climate Emergency Fund, which says it distributed $5.3 million to “organizations who tell the truth, disrupt normalcy, and demand transformation at emergency speed” last year.

Founded by the Getty oil heiress Aileen Getty, the CEF’s two other big donors are Rory Kennedy — the youngest child of Robert Kennedy, the former U.S. attorney general and senator who was assassinated in 1968 — and the film director Adam McKay. Together they represent a trinity of liberal American guilt: Big Oil, Big Politics and Hollywood.

The CEF is a regulated charity in the U.S., meaning it can’t fund lawbreaking directly. “Climate Emergency Fund does not support sabotage,” said Klein Salamon. “We only fund legal activities.” She emphasized their requirement for activists to undergo nonviolent training. However, groups that receive its money have openly broken the law. Just Stop Oil hosts a “Court and Prison” section on its website, which doubles as a hall of fame, with dozens of activists proudly going down for their mischief.

“We have, basically, engaged in sabotage,” said Skeet.

‘How everything can collapse’

Some members of the Tyre Extinguishers are already taking things beyond flat tires.

In the U.K. city of Bristol, Chris Bailey, the owner of a Range Rover found his car spray-painted in early April with the words: “THIS MACHINE KILLS KIDS” after his tires had been let down just three weeks earlier. Although he agreed that global warming was a serious issue, Bailey told local media the perpetrators were “causing a negative connotation with climate change” and making people “very resentful towards the movement.”

Meanwhile, in Brussels, Claude, thinks the climate movement needs to become more radical. The day after I ran with the Tyre Extinguishers through the city’s darkened streets, Claude and I met in a pub in a hipstery square where Brussels students party each weekend.

A newcomer to the cause, Claude gave his age as between 25 and 35. Three years ago, he was launching a corporate career. “I was promised a big job in a big company.” Then he read the book “How Everything Can Collapse,” by the theorists Pablo Servigne and Raphaël Stevens, which makes the case that environmental pressures could soon nudge our civilization into oblivion. Ten days later, he quit his job.

“I don’t want to have regrets,” he told me, opting for a soda while I took a beer. “If it goes wrong, OK, I would have done everything I could. That’s my way of thinking.”

“I’m part of this generation which is willing to go deeper,” he said.

But what does that mean, specifically? Would he harm a person?

“I would never kill someone … I don’t think I did any violent action yet. And I’m not planning to do one.”

What about blowing something up or other forms of sabotage?

“For me sabotage is not violence because I am not targeting people … So yeah, sabotage, I could do it without problem.”

He added: “I think it’s important to show the government and the firms that if what we did was not enough to make them move, then we are willing to move even more deeper, faster and stronger.”

It might be bluster. It’s certainly easy to say such threatening and scary things to a reporter who doesn’t know your real name. But here’s a thought: Five years after Thunberg turned millions of young people on to climate activism, a significant number of them are disillusioned with protest-as-normal — but just as angry and scared as they ever were. How many of them are out there, sitting in bars near you, contemplating how far they are willing to go?

Coal mines, highways, SUVs, snooker matches, metro stations, museum masterpieces — the list is already extensive. How long will it be before anyone, anything, anywhere becomes a potential target for disruption, or even violence? Those are questions that struck me as even more ominous when, an hour after my drink with Claude, I bumped into him again: The would-be eco-militant staring at me awkwardly in the beer aisle of a Carrefour supermarket.

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Republican party members celebrate obtaining the largest number of representatives after the election for the Constitutional Council, which will draft a new constitution proposal in Santiago, on May 7, 2023. ESTEBAN FELIX / AP/ Editing by Germán & Co

Chile: Far right ahead in key vote for new constitution

It was a major defeat for Chile's center-left president, Gabriel Boric, with the vote also widely viewed as a referendum on his government.

Le Monde with AP, TODAY

A far-right party led in the vote count on Sunday, May 7, after Chileans cast ballots for a 50-member commission that is to draft a new constitution after voters overwhelmingly rejected a proposed charter last year that was considered one of the world’s most progressive.

It was a major defeat for Chile's center-left president, Gabriel Boric, with the vote also widely viewed as a referendum on his government, which currently has an approval rating of around 30%. With 91% of polling stations reporting, the Republican Party, led by far-right José Antonio Kast, who lost the presidential runoff to Boric in 2021, led with 35% of the vote. The Republican Party has long opposed changing the constitution that was imposed by the dictatorship of General Augusto Pinochet.

A coalition of left-leaning parties allied with Boric, Unity for Chile, was in second place with 28% of the vote. A center-right alliance, Safe Chile, was in third with 21%. Null or blank votes made up 21% of the total. Preliminary calculations pointed to the Republican Party ending up with about 22 representatives on the constitutional council, compared to 17 for Unity for Chile and 11 for Safe Chile.

Boric's allies will have little room to influence final text

If the two right-of-center groups, the Republicans and Safe Chile, unite it could leave Boric's allies with very little room to influence the final text. The preliminary count suggested left-leaning coalitions would not reach the 21 seats necessary to veto proposals or force consensus on certain issues.

Sunday's vote marked a key step in the effort to come up with a new proposal for a constitution after 62% of voters rejected the previously proposed charter in September. It had been the first in the world to be written by a convention split equally between male and female delegates.

Critics said the document was too long, lacked clarity and went too far in some of its measures, which included characterizing Chile as a plurinational state, establishing autonomous Indigenous territories, and prioritizing the environment and gender parity.

Once installed, the commission's 50 members will not start from scratch but rather work from a preliminary document drafted by 24 experts who were approved by Congress. The body's proposal is to be put before the plebiscite in December.

The path to rewriting Chile’s constitution began after violent student-led protests in 2019 that were sparked by a hike in public transportation prices but quickly expanded into broader demands for greater equality and more social protections. Congress managed to get the protests under control by calling for a referendum on whether to draw up a new constitution, which almost 80% of voters agreed was needed.

Much of that enthusiasm appears to have vanished, though. Before Sunday's vote, polls said there was broad disinterest in the constitutional process. Luis Rodríguez, a 70-year-old retiree who cast a ballot, said: "I decided to vote because it's mandatory... I don't care about the result." Another retiree, David Pino, 65, said he also voted out of obligation. Fines for those who do not vote can be as high as $230.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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News round-up, May, 2, 2023

Quote of the day…

For Whom the Bell Tolls?

Horror Scenario

Germany Prepares for Possible Re-Election of Donald Trump

Berlin is preparing for the possibility that Donald Trump could beat Joe Biden in the next election. That outcome would likely be a disaster for Ukraine, NATO and the looming climate crisis. Diplomats have begun establishing contacts with the former president's camp to avoid being blindsided as they were in 2016.

Spiegel

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Most read…

Biden seeks debt ceiling talks, as U.S. faces possible June 1 default

The updated deadline comes less than a week after Republicans adopted a bill coupling an increase in the debt ceiling with spending cuts, defying a veto threat from President Biden

WP By Tony Romm, Tyler Pager and Liz Goodwin, May 1, 2023

Explosions Near Ukraine’s Giant Nuclear Plant Prompt Diplomatic Push

U.N. agency struggles to end Russia-Kyiv dispute over how to avert disaster at Zaporizhzhia

WSJ By Laurence Norman in Berlin and Drew Hinshaw in Vienna, April 29, 2023

This power plant offers a peek into the future

In Texas, an energy company is building a power plant that can run on hydrogen, a fuel that is gaining steam because of new tax credits and upcoming federal regulations

WP By Timothy Puko, May 1, 2023

AI: the key battleground for Cold War 2.0?

It’s becoming impossible to distinguish between the AI hype and warning of a conflict with China. What’s certain is that the hype will be monetised.

Le Monde Diplomatique by Evgeny Morozov

Chilean military sent to border to stem flow of migrants

In February left-wing President Gabriel Boric decided to send units to patrol the north of the country, where Venezuelan refugees cross into the country. Many immigrants have found themselves in a legal gray area.

Le Monde By Flora Genoux, (Iquique (Chile) special correspondent),  Published today at 12:53 am (Paris)

Horror Scenario

Germany Prepares for Possible Re-Election of Donald Trump

Berlin is preparing for the possibility that Donald Trump could beat Joe Biden in the next election.

Renewable energy's share of German power use tops 50% in Q1

By 2030, Germany intends to generate green energy from solar, wind, biomass, and hydropower to account for 80% of its energy mix.

Reuters

Israel planning 800 MW energy storage project -Energy Ministry

The plan calls for four storage facilities with a combined 800-megawatt capacity, which will be done "in stages in accordance with the system needs and with various storage technologies."

Reuters

BP's profit rises to $5 billion as share buyback slows

BP reported a substantial profit due to excellent gas marketing and trading results.

Reuters By Ron Bousso and Shadia Nasralla

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Image: PHOTO: Treasury Secretary Janet L. Yellen-. / Editing by Germán & Co 

Biden seeks debt ceiling talks, as U.S. faces possible June 1 default

The updated deadline comes less than a week after Republicans adopted a bill coupling an increase in the debt ceiling with spending cuts, defying a veto threat from President Biden

WP By Tony Romm, Tyler Pager and Liz Goodwin, May 1, 2023

President Biden invited House Speaker Kevin McCarthy (R-Calif.) and other congressional leaders to the White House next week to discuss the debt ceiling, as Washington scrambled Monday to respond to news that the government could default on its obligations as soon as June 1.

Biden’s request for talks followed a jarring new projection from the Treasury Department that the government could run out of cash to pay its bills in as few as four weeks without additional borrowing authority — an unprecedented event that could rattle world financial markets and tip the fragile U.S. economy into another recession.

The debt ceiling imposes a legal limit on the amount of money the U.S. government can borrow, currently set at $31 trillion. Since the national debt hit the cap in January, the Biden administration has adopted special budgetary maneuvers to conserve cash and buy time for lawmakers either to raise the limit or to suspend its enforcement.

Republican lawmakers — who took control of the House in January — have tried to seize on the looming deadline to extract spending cuts and other policy concessions from the White House. Last week, the House approved a Republican measure that would briefly raise the debt ceiling while cutting billions of dollars in federal spending and repealing some of Biden’s recent legislative accomplishments.

The president has threatened to veto the measure and called on Congress to raise the debt ceiling without conditions. Until Monday, Biden had also refused to haggle with Republicans over an issue that poses such immense risks to the economy.

But with Monday’s news that default could come as soon as next month, the president set in motion a plan to hold talks on May 9, personally calling McCarthy as well as Senate Majority Leader Charles E. Schumer (D-N.Y.), Senate Minority Leader Mitch McConnell (R-Ky.) and House Minority Leader Hakeem Jeffries (D-N.Y.), according to a White House official, who spoke on the condition of anonymity to describe private conversations.

The Treasury Department, meanwhile, sounded an urgent alarm about the need for haste: In a letter to lawmakers, Treasury Secretary Janet L. Yellen said the agency may be “unable to continue to satisfy all of the government’s obligations by early June, and potentially as early as June 1.”

Yellen cautioned that the projection is imprecise, given the variability of federal tax receipts, which have come in lower than anticipated in recent months. But she said she was certain about the economic consequences of inaction, warning that it could cause “severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests.”

“I respectfully urge Congress to protect the full faith and credit of the United States by acting as soon as possible,” Yellen said.

With time running out, the flurry of activity revealed a growing sense of anxiety in Washington. Few debates carry such high political and economic stakes: The nation has never defaulted on its financial obligations, and the failure to make payments to bondholders — as well as to federal employees and to beneficiaries of government programs such as Social Security — could send shock waves through the entire global financial system.

Adding to the uncertainty, the federal government and private economists have offered mixed, and sometimes conflicting, estimates as to the actual debt ceiling deadline, known in the nation’s capital as the “x date.” In its own projection, the nonpartisan Congressional Budget Office on Monday reported that there is now a “significantly greater risk” that the United States could run out of funds in early June. The CBO had earlier projected that lawmakers had as late as September to act.

Previously, Republicans have raised the debt ceiling without issuing demands. Three times, they addressed the borrowing cap under President Donald Trump without demanding fiscal reforms. Each time, Democrats serving in the minority also supplied their votes in a bid to avert a crisis.

Under Biden, Republican lawmakers have adopted a more aggressive posture, aiming to use the threat of a fiscal crisis as a political tool while blaming Democrats for the burgeoning debt. In reality, policies supported by both parties have contributed to a growing tide of red ink that could exceed $50 trillion over the next 10 years.

In a bill adopted last week, House Republicans spelled out their demands: They seek billions of dollars in spending cuts, the repeal of federal funds to fight climate change and pursue tax cheats, a set of new work requirements on welfare recipients, and an end to Biden’s plan to cancel student debts. Heralding the outcome at a brief news conference, McCarthy portrayed the so-called Limit, Save, Grow Act as a tool meant to force Biden to negotiate.

“The sad part here is, now the Democrats need to do their job,” McCarthy said after the vote. “The president can no longer ignore [it] by not negotiating.”

For the past three months, though, the two men have not met. The president has said he is open to discussing other fiscal issues with the House speaker, but only if the GOP lays out its plan for balancing federal spending and tax revenue, a difficult task the party has yet to tackle.

Even Monday, as Biden invited lawmakers to new discussions, he again slammed House Republicans for their legislation, saying “their extreme MAGA plan would cut critical funding for education, public safety, including cut 60,000 public schoolteachers, take health care and food assistance away from millions of working families.” The president also blamed Trump and his predecessors for incurring “200 years of debt,” adding: “We’re not paying for what we’re spending right now.”

McCarthy, who is on an official trip to Israel, responded to Biden’s invitation by criticizing the president for having “refused to do his job” and “threatening to bumble our nation into its first default.”

“After three months of the Biden administration’s inaction, the House acted, and there is a bill sitting in the Senate as we speak that would put the risk of default to rest. The Senate and the President need to get to work — and soon,” McCarthy said in a statement.

Understanding the debt ceiling

What is the debt ceiling?

It’s a restriction Congress has put on on how much money the federal government can borrow to pay its bills, which has been in place since 1917. Because the government usually spends more than it takes in, Congress needs to raise the debt ceiling fairly frequently to pay for its operations. (Sort of like a credit card bill.)

What is a default?

If Congress doesn’t raise the debt ceiling, the government can’t borrow and might not be able to pay its bills on time (like bond interest). That’s called a default, and it’s never happened before on this scale (though the U.S. got close in 2011). It would likely tip the U.S. into a recession and shake the global economy.

Why does the U.S. keep raising the debt limit?

Congress needs to raise the debt ceiling so the U.S. can keep issuing bonds, which investors around the world buy because they’re seen as a safe and reliable investment. In turn, the government can fund projects from the military to social programs.

Why is raising the debt limit a fight?

Until recently, it was routine for Congress to raise the debt ceiling. Since 1960, Congress has intervened 78 times to change it in some way. But it has become a political battle because it is one of the few must-pass bills, so lately Republicans have seen it as an opportunity to make demands.

In the Senate, meanwhile, Schumer has signaled that he has no plans to approve the House bill. On Monday, he promised that lawmakers instead would hold hearings that “expose the true impact of this reckless legislation on everyday Americans.” Schumer also took the first procedural steps toward ensuring the Senate could act swiftly on legislation to increase the debt ceiling, including potentially a two-year increase.

Some Senate Democrats responded with pessimism to the idea of talks at the White House, arguing that Biden should continue to refuse to negotiate.

“There’s no deal to cut here,” Sen. Brian Schatz (D-Hawaii) said Monday, before news broke about the president’s invitation. “The premise here is that there should be no policy concessions in exchange for preventing default.”

Some Senate Republicans appeared equally unenthusiastic about Biden’s outreach, reiterating their unwillingness to get involved in what they believe should be a negotiation solely between Biden and McCarthy.

“What we’ve said all along is the only thing that can get 60 votes in the Senate is something that’s negotiated between the president and the House Republican leadership,” said Sen. John Thune (R-S.D.), McConnell’s deputy. “And so I’m not sure at this point what Schumer or McConnell add to the debt conversation.”

The looming deadline and the lack of a path forward raised the grim specter of 2011, when Washington came within days of breaching the debt limit. Then the standoff between Republican lawmakers and a Democratic president spooked the stock market and triggered a downgrade in the nation’s credit rating, which ultimately cost taxpayers an estimated $1 billion in higher interest rates on government bonds.

This year, investors already have started to hedge against the potential for another disruption, shifting away from bonds that mature around the date of the debt ceiling deadline. In another ominous sign, Fitch Ratings, which evaluates debt, warned last week that persistent dysfunction could result in another downgrade of the nation’s credit rating.

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Image: IAEA Director-General Rafael Grossi, in cap, visited Ukraine’s Zaporizhzhia nuclear plant in late March. PHOTO: SERGEI ILNITSKY/SHUTTERSTOCK/ Editing by Germán & Co

Explosions Near Ukraine’s Giant Nuclear Plant Prompt Diplomatic Push

U.N. agency struggles to end Russia-Kyiv dispute over how to avert disaster at Zaporizhzhia

WSJ By Laurence Norman in Berlin and Drew Hinshaw in Vienna, April 29, 2023

The United Nations atomic energy agency is racing to prevent Russia’s war in Ukraine from endangering the Zaporizhzhia nuclear plant, Europe’s largest, as fighting nearby intensifies.

Artillery fire and explosions now ring out nearly every day at the six-reactor plant that sprawls near an active front line and is occupied by Russian security agents.

Each side accuses the other of shelling across a two-mile-wide bend in the Dnipro River that separates the plant from a Ukrainian-held shore. Both deny doing so.

A team of United Nations nuclear safety inspectors last week had to take shelter inside the facility. Twice this month, Russian land mines ringing the plant to prevent an amphibious assault have exploded. Russian troops in the neighboring city of Enerhodar raid apartments and search streets, seeking evidence of an insurgency network they suspect of spotting targets for Ukrainian troops lurking nearby.

On the roofs of several reactors, Russian forces have built sandbag fighting positions, the first indications that Moscow is planning to use the nuclear reactors as defensive positions, the British defense ministry said on Thursday.

“Something is definitely going on,” said a plant worker, sheltering in his apartment. “We hear very powerful booms around the perimeter of the city. Dogs howl, children get scared, car alarms go off

Since September, the U.N. atomic agency has sought agreement from the two warring nations to not position heavy military equipment at the plant or fire artillery from or toward it. Those negotiations have been one of the principal diplomatic efforts to de-escalate the war, and a test case for broader negotiations around the conflict.

A breakthrough remains elusive. On Wednesday, in a fresh bid for progress, International Atomic Energy Agency Director General Rafael Grossi spoke with Ukrainian President Volodymyr Zelensky before flying to Turkey for talks with Alexey Likhachev, the head of Russia’s state-owned Rosatom nuclear company and a primary interlocutor on securing Zaporizhzhia.

Complicating the fight over Zaporizhzhia is tension between the IAEA and the U.N. over how to handle the crisis. The IAEA is an independent agency but it reports to the U.N.

For weeks, U.N. Secretary-General António Guterres’s team has been telling diplomats and others that they believe the IAEA initiative has failed, according to people familiar with the dispute. Senior U.N. officials have said since February that they planned to take over the diplomatic efforts, according to one of the people, and in recent days the U.N. chief has huddled with the two sides to discuss new ideas, two diplomats said.

A spokesman for Mr. Guterres declined to comment. An IAEA spokesman said that the secretary-general has expressed his full support for the IAEA’s work.

A U.S. State Department official said Washington backs Mr. Grossi’s efforts. “We absolutely share his concerns,” the official said. “Russia is playing a very dangerous game with its military seizure of Ukraine’s nuclear power plant.”

Ukraine has been wary of the IAEA’s proposals, seeing them as permitting the presence of Russian armed forces currently occupying the plant. After a phone call between Messrs. Grossi and Zelensky on Wednesday, the Ukrainian president said Zaporizhzhia can only be safely secured by returning it to Ukrainian hands.

However a Ukrainian official said that the IAEA chief later presented some new ideas to encourage Kyiv to sign on.

Mr. Grossi has insisted he would continue his diplomacy and last week foreign ministers from the Group of Seven advanced democracies backed him.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Workers help manufacture a Mitsubishi Power M501JAC gas turbine at Savannah Machinery Works. Such technology will be used in some of the newest power plants in development, including a planned Entergy facility in Texas. (Mitsubishi Power Americas)

This power plant offers a peek into the future

In Texas, an energy company is building a power plant that can run on hydrogen, a fuel that is gaining steam because of new tax credits and upcoming federal regulations

WP By Timothy Puko, May 1, 2023

PORT ARTHUR, Tex. — A half-hour’s drive from where the modern oil and gas industry was born, a new power plant provides a glimpse into one possible future for fossil fuels.

In this Texas region called the Golden Triangle — named for the riches produced a century ago from the first modern oil field — the electricity producer Entergy is building what it calls the most advanced power station in its fleet. The $1.5 billion project comes with added capability: In addition to burning gas, its turbines can also run on hydrogen, a fuel that burns with no greenhouse gas emissions.

Technology such as this would probably become an imperative for many energy companies under historic power plant rules the Biden administration is expected to unveil this month. Those regulations, if they survive near-certain legal challenges, will play a critical role in the United States meeting its promises to cut carbon emissions.

“This is a way to keep growing gas, but make it cleaner over time,” said Steve Fleishman, a utility analyst with Wolfe Research. To reduce emissions but keep the power grid reliable, he added, “the system cannot rely just on adding renewables.”

Yet the Entergy plant also underscores the technological and political challenges that U.S. electricity generation faces as it transforms. Hydrogen power and other technologies — such as those that allow companies to capture carbon emissions and store them rather than releasing them into the atmosphere — are still far from proven solutions for large-scale deployment.

And even as Texas and other Republican-leaning states produce huge amounts of carbon-free electricity, lawmakers in those places and in Washington are often hostile to clean energy. Just last week, as part of legislation to lift the federal debt limit, House Republicans passed a bill to repeal the Inflation Reduction Act, a law that devotes hundreds of billions of dollars to subsidizing such transformations.

At a recent groundbreaking for Entergy’s plant — the Orange County Advanced Power Station — executives made no mention of the politics playing out in Washington. The company’s chief executive, Drew Marsh, didn’t mention gas once during his nearly five minutes of remarks. He mentioned hydrogen nine times.

“People are talking about hydrogen hubs,” Marsh said. “Affordable, reliable and clean energy is what our customers are looking for. And with this investment, they’ll get to check all three boxes.”

EPC Consortium of Mitsubishi Power, TIC and Sargent & Lundy to Build Entergy Texas’ New, Cleaner and More Reliable Power Station Representative illustration of the 2 on 1 combined cycle project, including two M501JAC enhanced air-cooled gas turbines, steam turbine, heat recovery steam generator, and advanced control system. (Business Wire via AP)

As operators of fossil fuel-burning plants are pressured to eliminate or at least reduce their planet-warming emissions, Washington has come through with subsidies for carbon capture and hydrogen to help. And the latest push from the Environmental Protection Agency involves new emissions limits that are so stringent, gas- and coal-burning power plants would need carbon-capture or hydrogen technology to comply, The Washington Post and others have reported.

With roughly a dozen projects such as Entergy’s nationwide, some power companies are trying to get ahead of that push from federal regulators, Fleishman said.

Both hydrogen and carbon capture are still developing — and often controversial — technologies. The infrastructure needs for both are massive, and it may not be a viable business solution for most companies, especially outside of the Gulf Coast and a few other select geographic areas, Fleishman said.

During the Obama era, the Department of Energy spent $1.1 billion to help launch 11 carbon capture demonstration projects. Only two of them are operational today. A study by the Institute for Energy Economics and Financial Analysis found that 10 of the world’s 13 biggest capture projects are either underperforming by large margins — trapping as little as half of the carbon dioxide promised — or have shut down.

When burned, hydrogen fuel produces no greenhouse gas emissions. But the fuel can have significant climate impacts depending on how it is produced, stored and transported.

Just producing it can create greenhouse gases. Currently, the most common way of producing hydrogen is to combine large amounts of natural gas with high-temperature steam. The process is highly energy intensive and creates carbon-dioxide emissions — unless it is paired with a carbon-capture system to control them.

Using a different process instead, producing hydrogen with solar, wind, geothermal or even nuclear energy, can avoid those emissions. But many environmental groups say that is a much riskier and less efficient use of that zero-carbon energy than just sending power from those sources onto the grid.

“If clean hydrogen is going to play a niche role in the power sector, then that hydrogen must have very low greenhouse gas emissions at every stage of its production, no matter how it’s produced,” said Emily Kent, the U.S. director of zero-carbon fuels at the Clean Air Task Force, an environmental organization.

If hydrogen is not properly stored and transported, it could also leak into the atmosphere, adding to the greenhouse effect. The Environmental Defense Fund and other groups say there is little data indicating whether the industry has a properly leak-proofed system.

“We currently do not have a very clean system for moving natural gas, and hydrogen is going to be even harder,” said Steven Hamburg, the fund’s senior vice president and chief scientist. “It’s still going to help us in the long term, without a doubt. So hydrogen has a role to play, but we have to get it right.”

But there are also signs that hydrogen and carbon capture technologies are becoming more viable. Their advocates often point to the Petra Nova project southwest of Houston, which used a system that captured more than 90 percent of the carbon dioxide from its flue gas — although that success was tempered by extensive outages, according to the Energy Department’s 2020 conclusions about the project.

The energy industry has changed dramatically since the Obama administration first targeted power-sector emissions through its Clean Power Plan nearly a decade ago.

In 2014, coal was the country’s top source of electric power, and the industry was the country’s top source of emissions, responsible for nearly a third of the nationwide total. Since, electric power has dropped to No. 2, with emissions down 20 percent, according to EPA data, as power companies closed waves of old coal-fired plants and replaced them almost exclusively with wind, solar and new, more efficient gas-burning units.

Despite that change, the grid is still reliant on fossil fuels, and its plants often support union members and working-class voters. Gas and coal still fuel roughly 60 percent of U.S. power. Both the White House and Congress have responded by pledging billions in new spending to develop new systems — such as carbon capture — that can preserve jobs and keep the lights on.

Carbon capture typically works through a chemical process to separate carbon dioxide from industrial gases. In many existing operations, it is then compressed into a liquid and routed to storage, or repurposed for industrial uses, keeping it from entering the atmosphere and warming the planet.

Four power plants nationwide actively use carbon capture, according to a count from the Clean Air Task Force. Coal-fired plants in the U.S. have the capability to capture 3 million to 4 million tons of carbon dioxide per year, and newly announced projects are on pace to raise that number more than sevenfold by 2025, according to Bloomberg data published last month in a U.S. Energy Department report.

A hydrogen storage facility at the National Renewable Energy Laboratory in Golden, Colo. Fortescue Future Industries and Forrest are investing heavily in green hydrogen production, with the goal to move the world to green energy as quickly as possible. (Chet Strange for The Washington Post)

The first major hydrogen-fueled power plant in the United States was completed in 2021, according to S&P Global. It is one of about a dozen similar projects in development, as tracked by the nonprofit Clean Energy Group, though most are smaller and sometimes just pilot projects.

Hydrogen production done in conjunction with carbon capture is expected to soar in the coming years, according to the Energy Department report, with an expected yearly capacity of 33 million tons of carbon sequestration by 2030, up from nothing today.

Much of that momentum has come from major subsidies approved in Washington. The bipartisan infrastructure spending package of 2021 included nearly $18 billion combined for carbon capture and hydrogen.

Last year’s climate-spending package passed by Democrats, dubbed the Inflation Reduction Act, then expanded on tax credits offered for every ton of carbon captured. Electric generators and industrial companies — including hydrogen producers — can now claim as much as $85 a ton, up from $50. Hydrogen producers also have the option of instead claiming a tax credit specifically for them.

While there’s uncertainty around the new EPA rules, the climate spending law can help make these technologies competitive with gas, said Bill Newsom, chief executive of Mitsubishi Power Americas.

“The key thing is cost. If we can get hydrogen and carbon capture cost competitive, then yes, it’ll play significantly in the marketplace,” said Newsom.

Mitsubishi Power is making the two turbines for Entergy’s Orange County project, part of a model the company is selling that can burn 30 percent hydrogen along with gas without any changes — and go to 100 percent hydrogen with what Newsom said are “small modifications.” The Japanese company is also the contractor for a Utah plant that is replacing 1,800 megawatts of coal power.

Newsom said the hope is to start both projects still at 70 percent natural gas, but to go to only hydrogen eventually, pending decisions from the plant owners and regulators. The Utah site also has a production and storage facility, creating the type of hub that the company hopes will perfect the process and drive down costs.

An Entergy spokeswoman said the plant may benefit from those tax credits in the future but did not detail how. The company declined a request for interviews with executives. State regulators must still approve use of hydrogen at the plant, and consumer demand and other market conditions will determine how much of it is used, a company spokeswoman said.

The Inflation Reduction Act tax credits will be available later, once the hydrogen gets produced and used — or the carbon gets captured — but tax lawyers say companies can start borrowing off those expected credits now to finance deals and new developments. That’s part of what is feeding this surge of development, building off consumer demand for zero-emissions energy that has also been growing in recent years, attorneys and executives said.

For the Biden administration, that momentum feeds into its regulatory plans. To impose more stringent limits on emissions, the EPA must be able to justify the costs it is imposing on industry. The federal subsidies, combined with these investments and growing development, should lead to technological improvements that make compliance less expensive, advocates say.

The advancements will allow the EPA to bolster the rules it sets through the Clean Air Act, and that’ll help the country fulfill Biden’s commitment to cut nationwide emissions in half by 2030 compared with 2005 levels, White House national climate adviser Ali Zaidi said earlier this year.

“They’re not going to ignore the fact that there’s a transformation going on in American industry,” Zaidi said in a February speech at the Georgetown University Law Center. “We have a whole new set of tools — including through the Bipartisan Infrastructure Law and the Inflation Reduction Act — that makes our job easier. So number one is using both of those tools and using them in tandem.”

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Image: Playing Tetris: visitors to the observatory at the Abeno Harukas skyscraper in Osaka can play the game projected on a huge wall, 30 November 2017 
The Asahi Shimbun/ Editing Germán & Co

AI: the key battleground for Cold War 2.0?

It’s becoming impossible to distinguish between the AI hype and warning of a conflict with China. What’s certain is that the hype will be monetised.

Le Monde Diplomatique by Evgeny Morozov

‘The Cold War Is Over’ proclaimed a flashy 1988 marketing brochure for a strange new computer game, an unlikely hit from behind the Iron Curtain. Then came the teaser: ‘Almost…’ Perhaps they got it right, but for the wrong reasons. The brochure, now at the National Museum of American History in Washington, was the brainchild of Spectrum HoloByte, a Silicon Valley software company then owned by Robert Maxwell (father of Ghislaine) (1). Featuring a drawing of the Kremlin with some geometric figures in front, the brochure warned of the ‘Soviet challenge’, announcing that ‘just when East/West tensions are beginning to ease, the Soviets have scored a direct hit on the US.’

That hit was Tetris, the cult computer game, whose Cyrillic name Тетрис – in bold yellow letters – was proudly displayed on the brochure’s bright-red cover page (the Soviet hammer and sickle replacing the final ‘s’). Spectrum HoloByte, the game’s US distributor, leveraged all the right cold-war themes – from Russian folk music to the images of the Soviet cosmonauts – to make Tetris a hit in Reagan-era America. Even then, some in Silicon Valley knew how to cash in on the cold war.

Fast forward to 2023. Gilman Louie, then the company’s CEO, is now a key figure in what some in Washington excitedly call Cold War 2.0 – the ongoing battle between China and the US for the commanding heights of the global economy. As the battle expands to technological and even military fronts, it’s no longer about Tetris. It’s now about artificial intelligence.

‘Unlock the American heartland’

Gilman Louie’s career path is a quintessential American journey. He made his name in the early 1980s designing flight simulator games. They were so successful that the US Air Force got in touch. Eventually, one of Louie’s startups appeared on Maxwell’s radar and he snapped it up.

By the late 1990s, Louie ran In-Q-Tel, CIA’s own venture capital fund, a nonprofit entity whose most famous bet led to the technology behind Google Earth. As the Trump administration began making noises about losing the technological race to China, Louie resurfaced as a member of the National Security Commission on Artificial Intelligence, a high-profile advisory group led by Eric Schmidt, former CEO of Google.

The tech industry and military contractors don’t always see eye to eye. Many American tech companies don’t want to lose the Chinese civilian market due to its sheer size. The military contractors have no such constraints

Just a few years later, that connection with Schmidt has blossomed into a closer partnership – so close that Louie is now CEO of the Schmidt-backed America’s Frontier Fund (AFF), an In-Q-Tel-like nonprofit venture, with a mission to help Washington ‘win the 21st century global technology competition’. The fund styles itself as a panacea, promising to ‘revitalise manufacturing, create jobs, bolster local economies, and unlock the American heartland’. And it has a most impressive board, which includes the ex-CEO of IBM and Trump’s former National Security Advisor.

‘Frontier technologies’

China’s growing influence in the so-called ‘deep tech’ or ‘frontier technologies’ like artificial intelligence and quantum computing is what led to AFF’s creation. ‘Frontier tech can’t be built in a garage,’ proclaims AFF’s website, departing from Silicon Valley’s faith in the genius entrepreneur. Between the novels of Ayn Rand and government subsidies, they choose the latter.

Ironically, Gilman Louie, the man who leveraged Cold War 1.0 to hype up Tetris, is now leveraging Cold War 2.0 to hype up AI. Or perhaps vice versa. In today’s Washington, these two operations have become almost indistinguishable, and the only certainty is that all that hype will be monetised.

To work in the age of AI, the old Tetris slogan needs some polishing. ‘The Cold War Is Over. Almost…’ sounds dated. However, ‘The New Cold War Is Here. Almost…’ is a message that many in America – from tech companies to defence contractors to hawkish thinktanks – find appealing.

For all the rhetoric, some ideological shifts are unmistakable. All the recent anxiety about losing the AI race to China seems to have stirred America’s policy elites from their slumber in the magical land of free markets. They sound like a group no longer bound by the dogmas of the Washington Consensus. Some even sound like they have cast in their lot with the Beijing Consensus.

A recent essay in Foreign Affairs (2), the publication of choice of the US foreign policy establishment, reveals not only a new-found enthusiasm for a strong, AI-boosting state, but a re-examination of policy errors of the past. Co-written by Eric Schmidt, the essay chides Washington’s earlier fascination with globalisation for distracting America from ‘strategic considerations’ and also attacks the venture capital industry’s short-termism.

It celebrates instead ‘grants, government-backed loans and purchase commitments’ as the right vehicle for accomplishing Washington’s long-term tech objectives. Obviously, such grants would probably be disbursed through entities like AFF, which, unlike conventional VCs, would know how to spend it with long-term interest in mind.

At times, the essay is just a few steps away from demanding a robust industrial policy. But it never quite gets there, saying that it remains a ‘fraught label’. As things stand, the revised Washington Consensus expects more public handouts to the private sector – and uses the fear of the US losing the next cold war as the main rationale.

Such arguments are usually framed to appeal to both sides of the aisle, making it imperative to complement geopolitical considerations with economic ones. And so it is this time, with the push for AI framed as a way to make America great abroad and at home, in the latter case by turbocharging new AI-enabled industries.

Thus, while some have mistaken the new American consensus for the emergence of ‘post-neoliberalism’, it has all the trappings of the cold war-era ‘military Keynesianism’ whereby greater military spending was supposed to help beat the Soviet Union and ensure American economic prosperity.

The Pentagon stands back

Yet, erasing the last three decades of neoliberal statecraft is proving difficult. Apparently, one can’t simply go back to the cold-war days, with nearly unrestrained funding flowing to a handful of military contractors. Today, one has to play lean and entrepreneurial, and generals don’t dream of relaunching themselves as Silicon Valley startups. The Pentagon has even been reluctant to operate its own In-Q-Tel-like venture fund, walking away from the money the US Congress has allocated it (Fortune.com, 17 March 2023). This might explain why AFF had to be created as a private venture.

Still, the links between the Pentagon and Silicon Valley have undeniably grown stronger. The US Defense Department has even recently created the new post of Chief Digital and AI officer – a position filled by Craig Martell, former head of machine learning at the ride-sharing platform Lyft. And, for all the ethical concerns from their employees, America’s tech companies continue making inroads into the military’s procurement budgets.

Thus, while Alphabet may have shelved its plans to work on the Pentagon’s controversial Project Maven – a computer vision project that prompted protests among its engineers – it went ahead and formed Google Public Service, an innocent-sounding unit which does offer cloud services to the military.

It’s hardly alone. Silicon Valley’s cloud and machine learning capabilities remain crucial to the Pentagon’s vision of building a system to integrate data coming from terrestrial and air sensors – these are no longer limited to radar – from across all branches of the armed forces. The idea is to crunch them with artificial intelligence, so as to mount an effective joint response. To that end, in late 2022 the Pentagon awarded four tech giants – Microsoft, Google, Oracle and Amazon – a $9bn contract to develop the infrastructure for this bold effort (defensescoop.com, 7 December 2022).

But, unlike in the old cold-war days, it’s not at all clear how much of this money would trickle down, Keynesian-style, to ordinary Americans. When it comes to AI, the labour costs accrue either to the star engineers – and we are talking hundreds, not millions of them – or to the numerous low-paid contractors who toil to help train the AI models. Most of them are not even in America, with OpenAI relying on contractors in Kenya to prevent ChatGPT, the popular AI chatbot, from showing obscene images and text.

As for cloud computing, it’s also not clear how its expansion would help. Building data centres is expensive and their positive effects on the economy have yet to be seen. They do tend to drive up the cost of real estate. And the environmental costs of both AI and cloud computing are not trivial. So the multiplier effect of pouring all this money into military AI might be a mirage.

So perhaps this Cold War 2.0 would not feature a return to ‘military Keynesianism’. Short of AI leading to the much-awaited Singularity, merely dumping more money in the tech industry won’t suddenly bring Keynes to life. Perhaps we are more likely to witness the weird new regime of ‘military neoliberalism’ in which ever-greater government spending on AI- and cloud-related matters would widen inequality and enrich the tech giants’ shareholders.

Return of Google’s ex-chief

No wonder some of them are so keen to restart the cold war. In fact, it’s Google’s former boss Eric Schmidt who’s done more than anyone to shape this new consensus (3). Worth roughly $20bn, Schmidt has been a fixture in Washington’s policy circles ever since campaigning for Barack Obama in the 2008 election. Between 2016 and 2020 he chaired the Pentagon’s Defense Innovation Advisory Board – for whom he visited some hundred US military bases around the world. He then made a quick transition to chair of the AI commission and has now resurfaced on a government commission on emerging biotechnology.

Schmidt’s many ventures to push his cold war narrative make it hard to keep track. There’s Innovation Endeavors, Schmidt’s venture capital fund, which lavishly funds startups that specialise in military AI. The highest-profile of them, Rebellion AI, has been recently described as an ‘early-stage WeWork and Theranos’ – a reference to the overblown promises made by its founders (Vox.com, 14 December 2022).

While Schmidt chaired the two government entities – the Pentagon’s board and the AI commission – he and his business partners invested more than $2bn in AI-related startups. Given that the commission recommended pouring more government money into such startups, one can only wonder what Schmidt’s advocacy is all about.

Elizabeth Warren, the firebrand Democratic senator, has even pressed the Pentagon for more details on Schmidt’s involvement with the US administration, suggesting that the Defense Department may have ‘failed to protect public interest’ in granting Schmidt so much influence. Now that he’s joined the new biotech commission, raising some eyebrows, his investments in this sector – through yet another venture capital fund – have attracted more criticism (CNBC.com, 13 December 2022).

The case of Schmidt Futures

Then there’s Schmidt Futures, his philanthropic foundation, which on closer examination turns out to be a for-profit company (4). It was recently in the news for funding the salaries of staffers working in the US government (5) – including in positions related to AI policy and tech regulation. Eric Schmidt (and indirectly Schmidt Futures) even played a role in helping Lyft’s Craig Martell to become the Pentagon’s AI chief.

How could a company possibly be paying the salaries of administration officials? Well, there’s a loophole: certain nonprofits are allowed to do that, and, as nonprofits, they can even receive money from companies. In this case, the nonprofit that receives money from Schmidt Futures (but not only them) is the Federation of American Scientists, a venerated cold-war thinktank that traces its origins to the Manhattan Project. Conveniently, its current chairman is that same Gilman Louie of Tetris fame (6).

Schmidt’s most effective cold war publicity gamble has been to recruit to his cause Henry Kissinger, not known for shunning billionaires. Perhaps, as a result of Schmidt’s influence, the 99-year-old Kissinger opining on AI sounds much like a 19-year-old describing their first LSD trip. ‘I think the technology companies have led the way into a new period of human consciousness,’ Kissinger said in a recent interview, adding that it is akin to what ‘the Enlightenment generations did when they moved from religion to reason’. By this logic, Eric Schmidt must be the new Voltaire.

Schmidt, Kissinger and a third collaborator have even penned a book-length manifesto (7) about this new era, in which they warn that AI warfare may lead to ‘inherently destabilising’ situations that are like those ‘created by nuclear weapons’. They ask, ‘Will terrorists engineer AI attacks? Will they be able to (falsely) attribute them to states or other actors?’ But they offer no answers. At times, it seems just a rehashing of the old talking points around the inevitable ‘cyber 9/11’, the earlier rallying cry of defence contractors eager to pillage public budgets.

After all this fearmongering, they arrive at a logical conclusion. What the world needs is a ‘concept of arms control for AI’. That’s all they say. The book remains vague on detail, opting for open-ended philosophical questions over analysis.

Schmidt is so keen to leverage whatever is left of Kissinger’s reputation that in 2021 he even launched a dedicated AI thinktank – Special Competitive Studies Project (SCSP) – modelled on a similar initiative that Kissinger himself ran at the height of the cold war in the late 1950s. At the time, Kissinger was far from advocating arms control of any kind. Rather, he was one of the most vocal proponents of the view that a limited nuclear conflict with the Soviets was all but inevitable, and probably a good thing for America.

Kissinger’s first cold-war initiative was itself a power-grabbing vanity project of another billionaire, Nelson Rockefeller. Its most high-profile report, released in 1958, called for continued increases in defence spending of roughly 1% a year and the overall ratcheting-up of America’s military preparedness. Its stance on arms control was unequivocal: ‘The illusion of security brought about by a spurious agreement to disarm would be a poor substitute for vigilance based on strength’ (8).

SCSP’s new ‘offset strategy’

For all the ‘AI arms control’ speculations of the Schmidt-Kissinger book, the policies advocated by SCSP point in the opposite direction. Of those, one stands out in particular: SCSP’s efforts to shape the next ‘offset strategy’ – a push SCSP markets under the catchy name of Offset-X. During the cold war, ‘offset strategy’ referred to the Pentagon’s efforts to leverage the latest technology, from battlefield nuclear weapons to airborne sensors, in order make up for its numerical inferiority with regard to Soviet tanks, planes and troops. From the mid-1940s, there have been three such ‘offset strategies’, all of them relying on different technologies and assumptions.

SCSP’s Offset-X advocacy assumes that, should a war between China and the US break out, the People’s Liberation Army (PLA) will go after US networks – and the US must be prepared. Thus, according to a recent SCSP report (9), ‘the outcome of a potential war with the PLA will increasingly come down to superiority and resilience of sensors, networks, software, interfaces between humans and machines, logistics and – especially – the systems that connect or empower them all together.’ This doesn’t exactly sound like arms control, does it?

To the uninitiated, it may sound awe-inspiring, but anyone familiar with Pentagon thinking over the past decade would probably yawn. Much of this was already part of Offset Three, which ran between 2014 and 2018, spearheaded by, among others, then Deputy Secretary of Defense Robert Work, who’s now resurfaced on SCSP’s board of advisors.

The primary audience for SCSP reports is not military types, but the general public. It’s they who need to be persuaded to increase the Pentagon’s AI budgets. And to do that, one must make a convincing argument that China is not only winning the AI war, but that its victory would crush the US militarily. The second assumption remains the stuff of science fiction. But is China winning that AI war?

US culture wars

To judge by its inability to offer an alternative to America’s ChatGPT, Beijing is still a long way off winning the AI race. Baidu’s launch of its ChatGPT competitor, ERNIE Bot, went so badly its stock price tanked.

To some extent, Silicon Valley’s leadership in the so-called Large Language Models – the type of deep learning AI behind ChatGPT – is a consequence of America’s cultural hegemony. The reason OpenAI, the company behind ChatGPT, is so far ahead of the competition is, in part, because its model is trained on vast holdings of English texts, abundant online. You won’t find as much Mandarin content.

Those who have been worrying about cultural imperialism have a great cause for concern now: ChatGPT may well emerge as the default provider of answers to the world’s questions. However, with ChatGPT, one is likely to be treated only to the blandest and most politically correct answers. We might all become prisoners of America’s culture wars.

Viewed outside of the narrow confines of ChatGPT-like language models, one may suspect China’s technology push is still going strong. A recent report by a prominent Australian thinktank suggests that it leads in 37 out of 44 critical technologies (10), a list that spans defence, space, robotics, energy, the environment, biotechnology, AI, advanced materials and key quantum technology areas.

The problem with most of such studies is that they focus – almost excessively – on research indicators tied to the relative performance of academic institutions, the number of publications and the degrees of individual researchers. Though this can be a useful proxy for dominance in a particular field, all these research papers count for nothing without the capacity to implement their findings.

And it’s here that US attempts to break China’s rise are bearing fruit – from efforts to cripple Huawei’s dominance in 5G to policies aimed at preventing Beijing from achieving self-sufficiency in the manufacture of advanced chips.

The tech industry and military contractors don’t always see eye to eye. Many American tech companies don’t want to lose the Chinese civilian market due to its sheer size. They definitely don’t want a full-blown Cold War 2.0, which would adversely affect their own sales there.

The military contractors, who don’t have many civilian contracts to begin with and who cannot work with the Chinese military without losing their Pentagon ties, have no such constraints. They want Cold War 2.0 – and they want it now. And some probably wouldn’t mind a hot war either.

Uneasy compromise

The Biden administration’s policy towards China’s tech ascendancy – slow but profitable strangulation – reflects the uneasy compromise between the two sides. Washington tightens the noose around Beijing’s neck by cajoling allies like the Netherlands, South Korea and Japan to stop selling their own critical technologies to China. As usual, it is also using cold war-era legal instruments – like the so-called Foreign Direct Product Rule – which can limit what foreign companies can ship to China, as long as their products are made using American technology.

This is not to say that Chinese companies have been completely cut off from the US hardware they need to continue their work on AI self-sufficiency. Instead of buying chips, they are now directed to rent them, sometimes at exorbitant prices, which has allowed some US tech giants to profit from Washington’s crackdown on Beijing.

The idea is to make AI development costly – but not prohibitively costly – thus profiting from Beijing’s desire for autonomy. And since Biden’s policies also slow down the pace at which Beijing achieves its goals, they give the US time to sort out its own AI-related problems (which by and large are to do with having too many eggs in Taiwan’s chip basket).

Keeping ‘China reliant on foreign chips’

At least no one in Washington is hiding the fact that maintaining and monetising China’s dependence – the one-time complaint of dependency theorists like Andre Gunder Frank or Ruy Mauro Marini – is the explicit objective.

Thus, another recent article in Foreign Affairs (11) – predictably, by someone in the Eric Schmidt universe – holds that ‘instead of implementing broad bands, US policymakers should work closely with allies to maintain China’s dependence on foreign chips’ and that ‘ensuring that Washington maintains the upper hand as the AI revolution progresses’ requires keeping ‘China reliant on foreign chips’.

Beijing is not taking any of this lying down. Recently, it insisted that Japan should think twice about joining Washington’s campaign to limit China’s access to advanced chips, all while starting a cybersecurity probe into Micron, an important US chipmaker.

What isn’t yet clear is whether Beijing would be able to steer an international coalition of some kind to support its agenda. Washington has not been acting alone to counter China, tapping into or even spearheading international initiatives such as Global Partnership for Artificial Intelligence and AI Partnership for Defense. Recently AFF – the Schmidt fund run by Gilman Louie – announced a joint fund with India, Japan and Australia under the auspices of the Quadrilateral Security Dialogue, a joint military initiative of the four countries aimed at restraining China.

Most of these efforts are taking place under the banner of promoting democracy and world peace, even if getting there requires boosting defence budgets and letting technology companies and their shareholders get even richer.

Europe is mostly absent from these efforts, for the obvious reason that on military matters it follows the US lead. And when changes occur, they are usually smallscale. It was recently announced that the Netherlands will host the investment management arm of the new €1bn innovation fund announced by NATO. That’s peanuts.

While the war in Ukraine has boosted European defence budgets, it will probably be American companies like Peter Thiel’s Palantir that will get most of the new AI-related funds. At this point, it’s Europe’s privacy laws – and not active public policy – that prevents US giants from advancing even further and faster. And it’s not just the recent case of Italy banning ChatGPT. A recent court ruling in Germany has found that the police use of Palantir-supplied data analysis software to prevent crime before it happens is unconstitutional. How long these privacy defences might last is anyone’s guess.

Judging by recent high-profile speeches by European Commission officials, they find Washington’s rhetoric of Cold War 2.0 quite convincing. This is likely to have an adverse impact on EU-China relations, while pushing the EU further into the arms of US tech giants. A much smarter strategy for the EU would have been to play the two sides against each other, something that Brussels has tried to do in the past, at least on some issues.

Absence of a cold-war enemy

In her 2014 book on how America’s national security state (rather than Silicon Valley) has been the true engine of the country’s technological leadership (12), the political scientist Linda Weiss noted that the absence of a cold-war enemy has undermined the Pentagon’s ability to create ground-breaking innovations. She even asked ‘why China has not yet metamorphosed into a rival that spurs innovation like the Soviet Union and Japan’.

It turns out this was just a matter of time. Then, Weiss argued that if the US was serious about preserving its technological leadership, it would need to get over its obsession with what she called ‘financialism’, put Wall Street’s interests aside and focus on rebuilding its manufacturing industry.

Financialism, of course, never ended. What we got instead is something much weirder. While some re-shoring does, in fact, take place, it’s anyone’s guess whether America will really reinvent itself as the world’s primary chip manufacturer.

Surprisingly, it’s not the downfall of Wall Street but the rise of Silicon Valley, with its desire to capitalise on the AI hype, that may have awakened the US from its slumber, while turning China into the strategic enemy that the Soviet Union once was.

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Image: Chilean soldiers monitor the international route taken by migrants that have been stranded for 14 days in the city of Arica, at the border with Peru. This photo was taken on April 27, 2023. PATRICIO BANDA / EPA/ Editing by Germán & Co

Chilean military sent to border to stem flow of migrants

In February left-wing President Gabriel Boric decided to send units to patrol the north of the country, where Venezuelan refugees cross into the country. Many immigrants have found themselves in a legal gray area.

Le Monde By Flora Genoux, (Iquique (Chile) special correspondent),  Published today at 12:53 am (Paris)

What day is it? "I've lost track of time," said Daniel, a 30-year-old Venezuelan migrant, sitting in a square in Iquique, a Chilean city in the Tarapaca region, some 1,700 kilometers north of Santiago. It was mid-April. "Last night, we slept outside. Me, just a few minutes. I was afraid we would be robbed," he said, pointing to his partner, Joselin, 26, and their daughter, Alanna, soon to be 3.

They had left Venezuela two months earlier because "they could no longer eat every day," they said. After traveling by bus and hitchhiking, they had reached their destination, Chile, a week earlier, after entering the country from Peru. Like thousands of other migrants, the majority of them poor Venezuelans, they crossed illegally, not having the means to pay for a passport and a visa in their country of origin. They hoped to land a job immediately. "We've asked everywhere, but we can't find anything. Being on the street makes us ashamed," said Daniel. A passer-by offered them two boxes of chicken and rice. But the Chileans they met warned them: migrants were not welcome here.

In an effort to stem the influx from Bolivia and Peru, on February 27 Chile's leftist President Gabriel Boric deployed the military to guard the border with both countries for a period of 90 days. The soldiers have the right to conduct identity checks and apprehend people crossing the border. "The country was not sufficiently prepared to receive this huge number of migrants," said Boric on March 15. "Unfortunately, some of them also come with criminal intent (...). We will look for them and, within the rule of law, we will make their lives impossible," he added.

A climate of suspicion

This measure reversed Boric's previous policy. Before he took office in March 2022, he pledged to have a migration policy based on human rights and a registry of foreigners without residence permits – a far cry from this military scenario. Instead, on April 18, the Parliament approved two bills tightening migration controls and conditions for deportation.

According to the Chilean Interior Ministry, the deployment of the military – a popular measure in the country – has reduced the number of illegal immigrants crossing the border by 55% compared to the same period last year, with an average of 440 arrivals per week. But the militarization highlights the state's shortcomings, the government's struggle to implement a coherent migration policy and the fragility of a social fabric riven by xenophobia.

Under a bright sun, facing the ocean with the foothills of the Andes behind him, 52-year-old garage owner Cristian (a pseudonym) was sipping a beer on the beach in Iquique, the migrant transit city closest to the northern border. He was proud of himself. In January 2022, during an anti-foreigner demonstration, he forcibly dislodged some migrants who were camping. In September 2021, another rally gave way to xenophobic scenes as residents burned the belongings of migrants camping in a city square, now fenced off. "They were delinquents," said the 50-year-old. "Not all of them," he added, "but these migrants bring us more harm than good. Because of them, the city has become dangerous. We are afraid."

Criminal organizations and lone offenders mix with the hundreds of thousands of people fleeing Venezuela's humanitarian crisis, which has created a climate rife with suspicion in Chile. According to the Tarapaca prosecutor's office, the region has the highest (and rising) homicide rate per capita. In 2022, 37% of those indicted were foreigners, compared to 19% in 2018. In Chile, the 1.5 million foreigners made up 7.5% of the population at the end of 2021. Their number doubled between 2018 and 2021.

Militarizing the border "is a purely political decision, a way for Gabriel Boric to show that he is in control," said Felipe Pardo, project development coordinator at the local Christian Churches' Social Aid Foundation (FASIC). But the dissuasive presence of the army is not enough to seal off the 1,000-kilometer border. In fact, the number of recorded arrivals is still higher than at the end of 2022. According to FASIC, the military are engaging in informal deportations, ordering migrants to turn back. But Chile also has to face Bolivia's refusal to accept non-Bolivians who have been deported – a policy that was also implemented in Peru since the end of April.

"Who are [the migrants]? Where are they? How many are they? The state can't reliably answer," said Daniel Quinteros Rojas, the state representative in the Tarapaca region. He himself advocates extraordinary regularization.

Requested to self-report

Chilean authorities require migrants to self-report. The state calls it a monitoring mechanism, but it is also often the first step before an expulsion order is issued (there were 1,034 between March and November 2022). However, self-reporting is recommended by some migrant aid organizations. It would allow people lacking a residence permit to formalize their presence on Chilean territory and, if necessary, to appeal the expulsion order in order to obtain regularization. "But this is not the way to get regularization," said Pardo, adding, "Everything pushes migrants to remain in clandestinity and precariousness."

"What do you advise me to do, to regularize myself?" asked 22-year-old Evelyn (a pseudonym) to the leaders of World Vision, an organization helping migrants in Iquique. She arrived in December 2022 with her two small children and her underage sister, after a risky five-hour walk from Bolivia to Chile. She did not self-report to the authorities. "I'm thinking of doing it to be regularized. But I am afraid that I will be expelled," said the young woman. She found a job as a dishwasher in a restaurant, working 11 hours a day with no days off and for a very low pay.

In a March report, Amnesty International condemned what it called an administrative gray area, placing migrants who are neither deported nor regularized in limbo. "Migrants' human rights are not respected in Chile," said World Vision regional manager Victoria Cardemil. Is this true? "Yes," replied Quinteros Rojas, reluctantly. "We have added more spots [from 400 to 500] in the emergency reception centers in Colchane [a Chilean village on the Bolivian border] and in Iquique. The conditions in the centers are better than before. Since Gabriel Boric's arrival, there have been no more anti-migrant demonstrations," he added.

After another night on the streets, Daniel, Joselin and their daughter showed up at World Vision headquarters. They wanted to rest and take a shower. But upon their arrival, the reception center staff apologized, saying there was no room left. The family left for the streets of Iquique. They continue to sleep far from the squares and other areas with high foot traffic. They know they have to keep a low profile.

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Image: Former President Donald Trump has said he plans to run again next year. Foto: Joe Raedle / AFP / Editing by Germán & Co

Horror Scenario

Germany Prepares for Possible Re-Election of Donald Trump

Berlin is preparing for the possibility that Donald Trump could beat Joe Biden in the next election. That outcome would likely be a disaster for Ukraine, NATO and the looming climate crisis. Diplomats have begun establishing contacts with the former president's camp to avoid being blindsided as they were in 2016.

Spiegel By Markus Becker, Markus Feldenkirchen, Marina Kormbaki, Veit Medick, Ralf Neukirch, Christian Reiermann, Jonas Schaible and Gerald Traufetter,  28.04.2023

It seemed like the 45th United States president, whose ancestors came from Germany, had an obsession with the country , but not a positive one. It often seemed as though he regarded Germany as America's greatest enemy, even as he got along splendidly with North Korean leader Kim Jong Un and others of his ilk. At least those ties were better than his relationship with then-German Chancellor Angela Merkel.

ANZEIGE

"The Germans are bad, very bad," Trump declared in May 2017 at a meeting with European Union leaders in Brussels, where one of the issues under discussion was Germany's trade surplus. "See the millions of cars they are selling in the U.S. Terrible. We will stop this," he said.

Over and over, he let the world know how he viewed the Germans: a nation of parasites who have taken "advantage of us for many years." He also saw the country as being unreliable, if not controlled outright by external forces. "Germany is totally controlled by Russia," he railed in July 2018. And later: "So, we're supposed to protect you against Russia and you pay billions of dollars to Russia."

Despite his penchant for preposterous rhetoric, Trump wasn't always wrong, sometimes even recognizing German hypocrisy or inconsistencies before the Germans did themselves. Still, Berlin was elated when Trump lost to his Democratic challenger Joe Biden in autumn 2020. The tenor in both Berlin and Brussels is that the trans-Atlantic relationship probably wouldn't have survived a second Trump term.

But now, that is exactly what could happen.

Trump announced his intention to run for a second term in the White House several months ago. In polls, Trump is far ahead of potential rivals from his own party, including Florida Governor Ron de Santis, who is widely considered to have the best chance to beat Trump in the primaries.

Since this week, it has been pretty certain that Joe Biden will be Trump's opponent again. The incumbent president would be 82 years old when he took office for his second term, and 86 when it ended. Trump, who is himself already 76, may not seem more serious by comparison, but he is definitely more dynamic. And the last race between the two of them was already a nail-biter.

A second presidency is actually a realistic outcome for Trump. At the very least, forward-looking politicians are considering the possible scenarios, especially in Berlin and Brussels, where Trump's favorite opponents are based: NATO, the European Union and Germany

Necessary Precautions

Michael Link is the German government's coordinator for trans-Atlantic cooperation. If Trump were to be re-elected, it would make his job a lot tougher. "Trump would be a greater challenge for Germany, Europe and the world in a second term than he was in his first term," says the politician, who is a member of the business-friendly Free Democratic Party (FDP). "He would probably govern in an even more unrestrained, unpredictable and defiant manner."

Preparations for the 2024 U.S. elections have already become a significant component of his job, and he is planning on traveling to the U.S. more often in the near future. "In the end, what counts are steady contacts in the executive and legislative branches of government," he says. "Individual senators can have a decisive influence on whether and how a bill is passed. If the going gets tough, they can be important allies."

Agnieszka Brugger, deputy head of the Green Party group in Germany parliament, also argues that preparations must be made for the possibility of Trump 2.0. She says the Europeans need to be more self-reliant and less vulnerable, regardless who is the current president of the U.S. "Even though we in the EU have become better in the technological, economic and security fields with regard to the crises of this world, we are still too slow," Brugger says. She says Germany and the EU should broaden their horizons and expand partnerships and alliances, "especially with countries of the Global South."

Disastrous for Climate Protection

Some in the German government believe that if Trump returns to office, it will be a horror scenario for climate protection. The Greens, in particular, recall with dismay his first term, when he withdrew the U.S. from the Paris climate agreement. Trump also rolled back over 100 environmental protection policies, made it easier for companies to drill for oil and gas in the ocean and allowed a controversial pipeline project to go through. Most crucially, though, he weakened the Environmental Protection Agency (EPA) by putting people at its helm who trivialized climate change.

Under Trump, the U.S. "would probably immediately withdraw from international climate finance," says Lukas Köhler, who is deputy head of the FDP's parliamentary group and responsible for his party's climate protection policy. He says it would have been difficult to move forward with commitments to establish a fund for offsetting climate damage without commitments at the last global climate summit. The system's future would be in question without funding from Washington.

At the G-7 summit in Germany last summer, German Chancellor Olaf Scholz and Joe Biden continued to hone the idea of a climate club, a community of countries that want to move their economies toward climate neutrality. Such a fundamental transformation requires significant investments and puts companies at a disadvantage relative to those corporations who can continue producing in a manner deleterious to the climate in other countries. The idea of the club is to support each other and prevent competitive disadvantages for their own industry. Its members now include countries like Chile, Argentina and Indonesia. "Right now, the U.S. is showing what it is made of in terms of climate policy," says Green Party head Ricarda Lang. "If that were to change again, a key driver for climate action worldwide would be lost."

The Threat of a Trade War

The most dangerous conflict for Germany in trans-Atlantic relations played out in the realm of trade policy. During his second year in office in 2018, Trump launched a trade war, declaring steel and aluminum imports from the EU a threat to national security and slapping a 25 percent punitive tariff on them. The EU retaliated with tariffs of their own on traditional American products like jeans, bourbon, whiskey, motorcycles and peanut butter.

The tone between Washington and the European Commission, the EU's executive, has unsurprisingly improved dramatically since President Joe Biden took office. But in terms of substance, little has changed. Like Trump, Biden is also pursuing an "America First" policy.

At first, it looked as though the situation might become less tense. Both sides basically suspended the punitive tariffs at the end of 2021. Officials also reached agreement in the dispute over subsidies for aircraft manufacturers Airbus and Boeing, which had been simmering for years. There was also a great deal of euphoria when Biden made a big push to transform the U.S. economy at the end of last year. The Inflation Reduction Act (IRA) is a huge subsidy program of over $370 billion for climate-friendly products ranging from electric cars to wind turbines. Upon closer examination, however, Germans and Europeans discovered that the IRA contains a strong protectionist component: The rules only allow domestic producers to benefit from the subsidies.

With billions in subsidies and low energy prices, the U.S. is in a position to lure companies away from the EU, especially in the field of important green technologies. Car companies could also migrate to the U.S. given the significantly lower cost of electricity. "In terms of security policy, the EU and U.S. are close, but on trade issue, Washington shows no willingness to make any concessions," says Bernd Lange of the center-left Social Democratic Party (SPD), who is the chair of the European Parliament's Foreign Trade Committee. And if Trump were to return to the White House, Lange believes, he would "likely tighten the protectionist stance seen in his first term."

FDP foreign policy point man Alexander Graf Lambsdorff, on the other hand, is more optimistic. "I am confident that the sensible Republicans in Congress could prevent the worst from happening," he says. "Even under Biden, not everything is easy – just look at his protectionist stance on economic issues, for example."

"Biden is saving our asses in Europe."

Michael Roth, chairman of the Foreign Affairs Committee in the German parliament

International financial markets are also likely to react extremely sensitively if Trump is re-elected. They are very good at sniffing out incompetence, which Trump demonstrated plenty of during his one term in office.

For example, he repeatedly tried to force the U.S. Federal Reserve, which is supposed to be independent of politics, to lower interest rates. He also drove up the U.S. national debt with big promises. It is true that the national debt also rose during Joe Biden's term in office. But there was no turbulence on currency markets. Investors trust Biden and his team to act professionally.

There are a number of foreign policy experts who are urging people not to lose their composure over the upcoming election. "NATO isn't dependent on just one person," says Sergey Lagodinsky, a member of the European Parliament with the Green Party. "A second term for Trump should be an incentive for us to strengthen European political self-sufficiency."

That's also the view taken by leading foreign policy experts in Berlin. "Biden is saving our asses in Europe," Michael Roth, chairman of the Foreign Affairs Committee in the German parliament and a member of the SPD, says of Europe's dependence on the U.S. He argues that Germany needs to do more for its own and European security, "regardless of whether the next president is named Biden, Trump or something else." Roth ticks off a list that are unlikely to draw any applause at any of his center-left party's conventions: "the steady increase in defense budgets to at least 2 percent of gross domestic product, the strengthening of the European defense industry and the expansion of Europe's strategic capacities." Marie-Agnes Strack of the FDP also calls for greater German self-reliance. "It makes no sense whatsoever to 'prepare' for different presidents," says Strack, who chairs the Defense Committee in German parliament. "We can't influence that, anyway."

Ukraine Would Probably Be Lost without the U.S.

So far, Europe hasn't been great at demonstrating its self-sufficiency. There are no disputes within the alliance about the overall goal of Europe's strategic autonomy, which French President Emmanuel Macron has emphasized repeatedly. But there are differences of opinion about what, exactly, that means. The Eastern European countries, above all Poland and the Baltic states, are opposed to a stronger military role for the EU. They want Europe to do more within NATO to bind the Americans more closely to the Continent. Macron, on the other hand, wants the EU to become an independent player on the global stage, also militarily. Berlin is somewhere in-between. These conflicts will erupt in full if Trump becomes president again.

A return of Trump to the White House would also be disastrous for Ukraine. In recent weeks, Trump has again revealed in several interviews his impassivity toward Russia's breach of international law and his lack of empathy toward the suffering of Ukrainians. He has claimed that if re-elected, he would end the war in Ukraine "within 24 hours." And if it were up to him, Russia would have been allowed to "take over" parts of Ukraine. They would be "very simple negotiations," Trump says, because he gets along very well with Vladimir Putin.

Trump has always admired Putin, probably even more than Kim Jong Un. Russia's influence on the 2016 U.S. election in favor of Trump is likely one reason for this loyalty. Even on the eve of the Russian attack, Trump described Putin's action as "pretty smart." He has never spoken that enthusiastically about Ukrainian President Volodymyr Zelenskyy. One possible reason is that Trump reportedly urged the Ukrainian president to open an investigation into the Ukrainian energy company Burisma, where Biden's son Hunter was once employed. But Zelenskyy refused – and Trump is widely known to be vindictive.

Ukraine probably would have lost already if it weren't for support from the U.S. Western military assistance for Kyiv didn't gain momentum until Washington took over coordination. And Brussels is currently demonstrating what happens as soon as Washington lowers the pressure: Europe becomes entangled in minute details. At the end of March, EU leaders announced that they would deliver 1 million rounds of artillery ammunition to Ukraine within 12 months and that they would jointly procure ammunition in the future. Since then, however, they have been arguing about the small print. "The inability of the EU to implement its own decision on the joint procurement of ammunition for Ukraine is frustrating," Ukrainian Foreign Minister Dmytro Kuleba wrote on Twitter last week. "For Ukraine, the cost of inaction is measured in human lives."

If Trump were to beat Biden next year, Ukraine would almost surely grow even more frustrated. Trump tends toward isolationism. If it were up to him, the U.S. would increasingly stay out of other countries' conflicts and invest even more in the domestic economy. His foreign policy reflexes are guided by economic interest rather than values.

A resolution recently passed in the U.S. House of Representatives by a group of Trump supporters ahead of the first anniversary of the invasion offered a preview of Trump's possible Ukraine policy. Its title: "Ukraine Fatigue." In it, 11 Republicans call for an end to military and financial aid for Ukraine. The motion shows clearly that a completely different U.S. Ukraine policy is conceivable.

Diplomats Approach the Trump Camp

In Berlin, a second term for Trump would likely result in the most changes for Annalena Baerbock. The German foreign minister, a member of the Green Party, maintains an amiable relationship with her U.S. counterpart Antony Blinken. Both have played some role in keeping the West in close alignment on sanctions against Russia. If Trump were to win the election, Baerbock would lose more than just a trusted partner. It would also weaken the kind of values-oriented foreign policy approach she has sought, not to mention her vision of a feminist foreign policy . Both are likely to be totally foreign concepts to Trump.

At the Foreign Ministry in Berlin, officials want to at least be prepared for that scenario. As such, the priority in German policy toward America is to establish contacts with U.S. Republicans. It won't be an easy project: Ties to the Republican camp have either been dormant for a long time, or they simply do not exist.

Staff at Germany's embassy and consulates in the U.S. have been tasked by headquarters to identify all potentially relevant individuals. From this point on, anyone traveling to the U.S. with the Foreign Ministry or other government ministries is expected to meet with U.S. conservatives, even in destinations far away from Washington. In particular, Andreas Michaelis, who will take up his post as the new German ambassador in Washington this autumn, is reportedly establishing targeted contacts in the Trump camp in order to be prepared for the worst-case scenario. It is a lesson learned from Trump's first election as president. In 2016, the German government was counting on victory by Hillary Clinton and had not bothered to establish contacts within Trump's team until it was far too late. The idea is to prevent that from happening again.

Moreover, Baerbock's diplomats have identified issues with which the Germans might be able to find some common ground with Republicans. One example on this list is the promotion of electric cars. Since the emergence of Tesla CEO Elon Musk, this issue is no longer relegated exclusively to the realm of the leftist fringe.

Another issue is China. Under the auspices of the Foreign Ministry, Germany is currently developing a China strategy that, on balance, advocates adopting a greater distance from the People's Republic. There are few other issues over which the U.S. Republicans and Democrats are as united as on their tough stance toward China. Berlin's China strategy is being designed in a way to show the Americans that Germany can also be an ally in the Indo-Pacific realm. It is unclear, however, whether German Chancellor Olaf Scholz will ultimately support the Foreign Ministry's robust China stance.

Neither Scholz nor those close to him want to see the status quo in trans-Atlantic relations change too quickly. They argue that it has been years since diplomatic contacts with Washington have been as close as they are right now and they point out that a hotline to all key players in the Biden administration currently exists.

Besides, Trump and Scholz seem like two men from different planets. Trump's brand of politics is frenetic, while Scholz consistently seems as though he has just been taken out of cold storage. While Trump follows his instincts or wants to make a quick headline, Scholz trusts only his wits or Wolfgang Schmidt, his devoted chief of staff in the Chancellery. How are those two world's supposed to fit together?

A President Trump could actually create some advantages for Scholz personally. Some on the chancellor's team recall Angela Merkel in this context: Internationally, she was only able to rise to the position of defender of the free world because there was someone in Washington who was seen as its destroyer. Scholz, according to the interpretation of those close to him, could also play himself off as Trump's foe if need be.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image: Wind turbines, including some from RWE's new Kaskasi offshore wind farm, are pictured during the opening of the RWE-Offshore-Windpark Kaskasi, north of Helgoland, Germany, March 23, 2023. Christian Charisius/Pool via REUTERS TPX IMAGES OF THE DAY/Editing by Germán & Co

Renewable energy's share of German power use tops 50% in Q1

By 2030, Germany intends to generate green energy from solar, wind, biomass, and hydropower to account for 80% of its energy mix.

Reuters

FRANKFURT, April 28 (Reuters) - Renewable energy accounted for 50.3% of Germany's power consumption in the first three months of the year, data from utility group BDEW and the Centre for Solar Energy and Hydrogen Research (ZSW) showed on Friday.

Germany wants green power from solar, wind, biomass and hydroelectric generation to account for 80% of its energy mix by 2030, as it abandons nuclear power and aims to cut most of its coal generation, using gas plants mostly for grid back-up.

The preliminary figures partly reflected lower power consumption in the first three months of 2023 when electricity usage fell 6.4% year-on-year to 138.1 terawatt hours (TWh), BDEW noted in a statement.

Renewables accounted for 49.2% of the mix in the first three months of 2022.

The data was calculated under European Union requirements that base the share on usage rather than production, a method also adopted by the Berlin government for its climate target definitions, BDEW said.

"Because the renewable share is measured by its share in overall usage, lower (electricity) consumption means a higher relative share and vice versa," it added.

Looking at domestic electricity production, the two research bodies recorded a fall of 8.3% to 147.5 TWh in the three-month period, including production volumes directed for export.

Within the output total, renewables, at 69.5 TWh, accounted for a share of 47.1%, up from 45.1% in the first three months of 2022, even as green power production volumes dropped 4.3%.

Conventional energy sources - nuclear, coal, natural gas and oil - provided 78 TWh within the generation total, down from 88.3 TWh a year earlier.

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Image: FLUENCE Sunstack™ was specifically designed to optimize solar capture and delivery. The Sunstack system architecture unites batteries and PV on the same side of the DC bus in order to take advantage of higher PV-to-inverter ratios, maximize solar yield, and simplify the interconnection process.

Israel planning 800 MW energy storage project -Energy Ministry

The plan calls for four storage facilities with a combined 800-megawatt capacity, which will be done "in stages in accordance with the system needs and with various storage technologies."

Reuters

JERUSALEM, May 2 (Reuters) - Israel's Energy Ministry said on Tuesday that it was moving forward with a plan to build the country's first large-scale energy storage project.

The plan is for four storage facilities with a combined capacity of approximately 800 megawatts, which will be built "in stages according to the needs of the system and with different storage technologies."

The project was given a green light by Israel's national planning council and will be brought for approval by the government.

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Image: The BP logo is seen at a BP gas station in Manhattan, New York City, U.S., November 24, 2021. REUTERS/Andrew Kelly/ Editing by Germán & Co

BP's profit rises to $5 billion as share buyback slows

BP reported a substantial profit due to excellent gas marketing and trading results.

Reuters By Ron Bousso and Shadia Nasralla

LONDON, May 2 (Reuters) - BP (BP.L) made a profit of $5 billion in the first quarter of 2023, up from the previous three months on the back of strong oil and gas trading, but the company's shares fell as it slowed a share buyback programme.

BP's results, which beat forecasts, follow a strong showing from rivals including Exxon Mobil (XOM.N) and Chevron last week as oil majors continue to benefit from energy prices that remain strong despite some softening since the start of the year.

BP's shares, however, had fallen around 4.5% by 0735 GMT - compared with a drop of around 1.2% for an index of European oil companies (.SXEP) - after it said it would repurchase $1.75 billion worth of shares over the next three months, down from $2.75 billion in the previous three.

First-quarter underlying replacement cost profit, the company's definition of net income, reached $4.96 billion, up from $4.8 billion in the fourth quarter of 2022 and above expectations of $4.3 billion in a company-provided survey of analysts.

The profit reflects "an exceptional gas marketing and trading result, a lower level of refinery turnaround activity and a very strong oil trading result", BP said, noting the partial offset from lower oil and gas prices and refining margins.

BP had reported a $6.25 billion profit in the first quarter of 2022.

The lower share buyback "will more than offset the good operational performance as BP is the first international oil company...to cut buybacks this quarter," Jefferies analysts said in a note.

BP repurchased $11.7 billion of shares in 2022 and the $1.75 billion indicated on Tuesday still means the company will exceeded its goal of using 60% of surplus cash for the purpose.

Its dividend remained unchanged at 6.61 cents per share after a 10% increase in February. BP had previously halved its payout in the wake of the pandemic.

Reuters Graphics

WEAKER DIESEL

The London-based company said it expects oil and European gas prices to remain strong in the second quarter even as refining profit margins are expected to weaken due to lower diesel prices.

BP shares have outperformed in the sector so far this year, up 10% compared to a 6% rise for Exxon and a 3% gain for Shell.

Benchmark Brent crude oil prices averaged $81 per barrel in the first three months of the year, down 16% from a year earlier and 7% from the fourth-quarter.

BP's profit hit a record $28 billion in 2022 on soaring energy prices and market volatility which benefited its large trading business.

Reuters Graphics

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Geothermal Core revolutionizes renewable energy source…

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Geothermal Core is a game changer. Its innovative approach to harnessing the Earth's heat promises to provide a sustainable and reliable energy source for future generations…

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Source: Geothermal Core/Editing by Germán & Co

By Germán & Co, Karlstad, Sweden, June 12, 2023

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…“Iceland is far from the economic and geopolitical challenges faced by their counterparts in the Baltic Sea region. The complexity and intelligence behind the creation of our biospheres and humanity's conception are fascinating. Ecosystem diversity is endlessly fascinating, but many mysteries remain. Iceland brings together different paradigms. During summer, the "midnight sun" occurs when the solar constellation emits intense light, causing continuous daylight for twenty-four hours. Unconventional to outsiders. The bright stream of light fades in autumn and disappears in winter, leaving eternal darkness that can trouble the soul. We explored environmental biodiversity. Iceland is habitable in the Arctic. This remote rock near the North Pole has abundant geothermal energy from active volcanoes. The island’s caverns hold a force that fractures the ground and creates geysers. Hot water and steam spew high. Iceland's geothermal energy makes it self-sufficient in electricity. The delta's biodiversity supports human life in an otherwise uninhabitable environment. Iceland's small population of 400,000 people is one of the happiest societies on Earth.

Germán & Co

https://energycentral.com/c/og/fischer-vs-spassky-draw-game-no-20-reykjav%C3%ADk-1972

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In this matter, "The Florence Declaration", WORKING TOGETHER TO PROMOTE GEOTHERMAL ENERGY TOWARDS A SUSTAINABLE ENERGY FUTURE, signed in the city of Florence in Italy on September 11-12, 2017, by political leaders from 25 nations, is a significant step in addressing climate change. The declaration aims to increase geothermal power generation by 500% globally by 2030. Geothermal energy accounts for just 0.3% of global renewable energy capacity. Reducing emissions can save costs. Geothermal energy adoption is hindered by geography and finances. Geothermal power plants rely on natural hydrothermal reservoirs, limiting their potential to specific regions. Funding challenges have impeded progress in geothermal energy initiatives in the Asia-Pacific region. IRENA's report suggests transparent regulations and better capital access for exploration and drilling to create a stable environment Geothermal energy is believed to have originated during the early stages of the Earth's formation, approximately 4.5 billion years ago, which coincided with the creation of the solar system. Geothermal energy is commonly recognized as a sustainable and eco-friendly energy source due to its inherent connection with the natural processes of the Earth. The geothermal industry has undergone significant development since the establishment of the first commercial geothermal plant in Italy in 1904. Geothermal resources exist in various forms, such as dry steam, hot steam, hot water, and hot rock. Various types of geothermal plants have been developed and implemented based on the unique characteristics of each geothermal resource. Single-flash for renewable energy developers and investors. Addressing these issues can unlock geothermal energy's potential as a sustainable source and contributes to global greenhouse gas emission reduction.

Before discussing Joy's journey in the Geothermal Core, I would like to address two current aspects of the sector that I recently discussed with Matt Chester of EnergyCentral.

Dr. Jay Patel

Chairman & CEO

…”In a world full of bad news. Hasty decisions made to weather the current situation may be attributed to these challenges. The world has changed drastically, and it is difficult to imagine a return to the past. Our lives, work, and relationships have been permanently altered, and we are struggling to adapt. It is crucial to be cautious, especially when following trends. One scenario resulted from a political mistake regarding energy infrastructure… This reminds us to prioritize safety and well-being by making wise choices.

G&C: Please, Jay, share some information about yourself and your perspective on the current and future state of the industry…

JP:

How and when was Goethermal Core created?

JP:

GEOTHERMAL CORE PROJECT MAP

G&C: What can you tell us about current and future projects?

JP:

What do you think is the biggest challenge facing the industry? Low-Carbon Electricity is Expected to Cover New Power Demand in 2030 and 50? Is it possible?

JP:

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News round-up, April, 27, 2023

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Most read…

Rooftop Solar: Ain’t No Sunshine

Enphase points out rising interest rates and new net metering rules in California are casting a shadow over rooftop solar growth prospects

Higher interest rates have made rooftop solar a much harder sell in states with lower utility rates.

WSJ Jinjoo Lee, April 26, 2023

Why resuming tariffs on Chinese solar firms threatens U.S. climate goals

An increasing number of Democratic lawmakers are supporting a proposal to reverse President Biden's temporary hold on crushing taxes on specific imports of solar energy.

Analysis by Maxine Joselow with research by Vanessa Montalbano, April 27, 2023

Colombia’s President Replaces Market-Friendly Finance Minister in Cabinet Reshuffle

The changes come in the wake of the breakup of his governing coalition and prompt the peso to weaken

WSJ By Juan Forero, April 26, 2023 

The EU lacks a credible economic security strategy

The bloc needs to develop a strategy that anticipates future threats and leverages its most valuable security asset — its position as the largest economy in the world.

POLITICO EU BY TOM KEATINGE, APRIL 27, 2023 

The North Seas can be the world’s biggest power plant

Tomorrow, we will be taking another crucial step toward a green and independent Europe.

POLITICO EU BY ALEXANDER DE CROO, MARK RUTTE, XAVIER BETTEL, EMMANUEL MACRON, OLAF SCHOLZ, LEO VARADKAR, JONAS GAHR STØRE, RISHI SUNAK AND METTE FREDERIKSEN, APRIL 23, 2023 

The Climate Crisis Gives Sailing Ships a Second Wind

Cargo vessels are some of the dirtiest vehicles in existence. Can a centuries-old technology help to clean them up?

The era of sailing ships may seem like a distant memory, but it's important to remember that they were only partially replaced by diesel vessels. The Avontuur, a sailing schooner constructed in 1920 by a Dutch shipyard, is a prime example. Despite being over 90 years old, the Avontuur operated as a passenger liner on the Dutch coast in 2012. However, the United Nations issued a climate assessment that year, warning that the planet was heading towards a future of extreme weather conditions and disasters caused by intensifying heat waves, fires, and storms. We must take action and end our reliance on fossil fuels before it's too late.

Germán & Co

The New Yorker By Pagan Kennedy, April 27, 2023

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Image: PHOTO: RICK BOWMER/ASSOCIATED PRESS/ Editing by Germán & Co 

Rooftop Solar: Ain’t No Sunshine

Enphase points out rising interest rates and new net metering rules in California are casting a shadow over rooftop solar growth prospects

Higher interest rates have made rooftop solar a much harder sell in states with lower utility rates.

WSJ Jinjoo Lee, April 26, 2023

The U.S. rooftop solar business has grown with two essential catalysts: Low interest rates, which make such installations affordable for consumers, and state-level policy that handsomely rewards households with such solar systems for selling excess solar energy back to the grid. Both of those are going in exactly the wrong direction at the moment.

Enphase ENPH -25.73% Energy, a company that manufactures micro-inverters for rooftop solar panels and energy storage systems, confirmed their direction on its earnings call late Tuesday. Its stock fell 24% in morning trading, dragging down other solar company stocks. SunPower and SolarEdge Technologies SEDG -10.43% were each down about 10% on Wednesday morning.

Cold PlungeStock price performanceSource: FactSet

SunPowerSolarEdge TechnologiesEnphase EnergyApril 20April 26-30-20-10010%

The company itself had solid high-level numbers to report for its first quarter: Total revenue was roughly flat compared with a quarter earlier, largely as Wall Street analysts expected. Net income was 46% higher than what analysts had penciled in. Revenue guidance for the second quarter, though, was weaker than their expectations, and commentary about the U.S. market was a sobering reminder of near-term challenges for the solar industry.

Enphase said its sell-through of micro inverters in the U.S. was 21% lower in the first quarter compared with the previous quarter, which was worse than the typical seasonal decline of 15%. Sell-through was particularly weak in states with lower utility rates such as Texas, Florida and Arizona, according to the company. In such states, higher interest rates have made rooftop solar a much harder sell to households compared with states in the Northeast where utility rates are higher. The recent banking turmoil has also raised financing costs and tightened credit standards for solar loans, according to a recent report from Zoë Gaston, analyst at research firm Wood Mackenzie.

Another source of uncertainty comes from California, the largest rooftop solar market. The state last year changed the way rooftop solar customers get compensated from selling excess solar energy back to the grid. The new rule—known as net energy metering 3.0—effectively reduced the amount rooftop solar customers get for selling excess energy by 20%-30%, according to ClearView Energy Partners. In the near-term, the change actually boosted demand in California as customers rushed to install solar systems before the new rules kicked in for solar systems. The older, more generous solar rates still apply to systems for which interconnection applications were submitted before April 15. Wood Mackenzie expects the U.S. residential solar market to contract by 3% in 2024, which would be the first full year affected by California’s new rules. 

Enphase thinks these challenges are temporary and said California’s policy change should boost its energy storage business over the long term. Notably, under the new rules, the rate that solar or solar-plus-storage customers receive is based on the avoided cost to utilities, or the marginal cost utilities would avoid if these home energy systems provided power instead of themselves. In peak air-conditioning months, such as August and September, when energy demand stays high in the evening while supply is tight after the sun goes down, homes with battery storage would benefit from higher compensation.

That may be true but, as Enphase itself says, it could take time for customers to realize that benefit. Meanwhile, there is no visibility on when interest rate hikes will pause. As long as those two shadows persist, investors will find it difficult to focus on the glimmering, long-term promises to solar offered by the Inflation Reduction Act.

The Inflation Reduction Act’s Bait and Switch

Sensible energy policies would avert the economic harm the measure’s climate extremism could inflict.

WSJ By John Barrasso, April 20, 2023

Promise one thing, deliver another. It’s a tactic Democrats have used time and again: the bait and switch.

Last year, Democrats enacted their reckless green spending spree, and labeled it the Inflation Reduction Act. Starting with the name, just about every assurance Democrats made about the bill is false. Among other claims, the White House asserted that spending a tidal wave of taxpayer money would reduce the deficit, lower costs for families, grow the economy and create jobs.

Will it? Thanks to recent modeling results from the U.S. Energy Information Administration, we can say with confidence the answer is no. The Energy Information Administration is one of the world’s premier energy modeling institutions. Every year it issues a “business as usual” reference forecast that includes, to the extent possible, all current laws and rules affecting the energy sector. It also issues forecasts based on different policy, economic and technology assumptions.

Among the many scenarios the Energy Information Administration just released was one without the Democrat law (“No IRA”) and one in which businesses and consumers make full use of the law’s provisions (“High IRA Uptake”). The one with the Democrats’ energy and climate plans fails to produce a stronger economy, more jobs or more disposable income. That’s not what the sales pitch said.

The good news is that there is a way to expand our economy, help American families thrive and begin to tackle our enormous budget deficit. The Energy Information Administration examined what might happen in a future with significantly greater oil and natural gas output (“High Oil and Gas Supply”).

Compared with the High IRA scenario, the results are astonishing. From 2023 to 2050, the high oil and gas supply case produces $35 trillion more in total gross domestic product. That’s more than the entire federal debt of $32 trillion.

The federal government typically collects about 20% of GDP in revenue. That greater growth would translate into an additional $7 trillion in federal tax revenue through 2050. That’s 2.5 times the amount in the Social Security trust fund at the beginning of 2023.

Compare this to the spending binge Democrats rammed through Congress. The Committee for a Responsible Federal Budget tallied up the costs and found the law will add more than $4.8 trillion to deficits between 2021 and 2031.

Despite Democrat promises, it turns out going green means going further into the red. With Social Security and Medicare facing fiscal challenges, climate extremism will only make addressing our fiscal problems worse.

The benefits of a robust oil and gas sector don’t stop with GDP and revenue. Energy Information Administration data show the average number of U.S. jobs would be 4.5 million higher each year compared with the High IRA case. Families and businesses would enjoy lower prices for electricity, gasoline, diesel, home heating oil, natural gas and propane. Disposable income would average $645 billion more per year. Carbon-dioxide emissions from energy would be 11% lower in 2050 than in 2022.

The president’s blind loyalty to climate extremists is driving him to shut down conventional energy production and deny the American people its benefits. The president let slip during his State of the Union speech that he believes we’ll need oil and gas only for another decade. His climate envoy John Kerry offered seven or eight years.

They’re living in a fantasy world. In the real world, every reputable energy forecast shows that people will use huge amounts of oil, gas and coal at least to 2050.

Someone will have to supply that energy to a growing world. America is perfectly positioned to do so. We can do it more cleanly, more efficiently and more securely than anyone else. Russia, Venezuela, Iran and Saudi Arabia will fill whatever void we leave.

Forecast models don’t provide answers. They provide insights. The key insight from the Energy Information Administration’s modeling—and one that has been consistent over the years—is that a strong, vibrant oil and gas sector is vital to a healthy U.S. economy. It underpins growth. It’s a source of revenue. It stimulates job creation. It lowers energy costs for families. It enhances our competitiveness. It advances our geopolitical interests.

The Biden administration brags about erecting obstacles to traditional energy production. It is trying to ban gas stoves, eliminate conventional cars, and end the use of fossil fuels. The goals are completely unrealistic, but the policies have dramatic and negative consequences for our economy and security.

The permitting reform and energy bills Sen. Shelley Moore Capito and I will introduce and similar legislation the House just passed will help revive the “all of the above” energy strategy that has served the country so well.

One of America’s biggest economic and geopolitical assets is its energy resources. It’s time we put them back to work.

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Image: A solar farm near Deport, Tex., on March 5, 2022. (Cooper Neill for The Washington Post)

Why resuming tariffs on Chinese solar firms threatens U.S. climate goals

An increasing number of Democratic lawmakers are supporting a proposal to reverse President Biden's temporary hold on crushing taxes on specific imports of solar energy.

Analysis by Maxine Joselow with research by Vanessa Montalbano, April 27, 2023

Good morning and welcome to The Climate 202! Below, we have an exclusive on a new permitting proposal from Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.).

A growing number of congressional Democrats are backing a measure that would undo President Biden’s temporary pause on crushing tariffs on certain solar imports.

It’s the latest example of how mounting anti-China sentiment in Washington has scrambled traditional political alliances and unnerved America’s clean-energy sector, we report with our colleague Evan Halper.

The outcome of the unfolding political drama could have major consequences — not just for solar energy companies, but also for homeowners hoping to add solar panels to their roofs, motorists wanting to charge electric vehicles with clean power and utilities trying to reduce their carbon footprints. 

China dominates solar supply chains. Figures provided by the research firm BloombergNEF show that Chinese companies make more than 95 percent of the wafers and ingots essential to assembling solar panels.

The details

The measure would undo Biden’s two-year suspension of the tariffs, which apply to solar cells and panels made by Chinese companies but sold out of Cambodia, Malaysia, Thailand and Vietnam. 

• The White House announced the suspension last summer in an effort to reassure the domestic solar industry, which had been paralyzed by a Commerce Department investigation into alleged tariff dodging by Chinese cell- and panel-makers.

• But in December, Commerce issued a preliminary finding that the Chinese manufacturers were, in fact, dodging tariffs. In response, a bipartisan group of lawmakers introduced a resolution to overturn Biden’s pause, saying China needed to be punished for circumventing U.S. trade law.

• The measure was introduced using the Congressional Review Act, which allows lawmakers to nullify the administration’s decisions with a simple majority vote within 60 legislative days. 

Many lobbyists and analysts expect the measure to garner the 60 votes needed to pass the Senate — requiring at least 11 Democrats to support it. 

While Biden has vowed to veto the resolution if it reaches his desk, the solar industry and its allies fear that supporters could reintroduce the proposal as an amendment to must-pass legislation.

“I’m worried that if you give them 60 [votes] in the Senate, Republicans will keep coming back for more bites at the apple,” said a House Democratic aide who spoke on the condition of anonymity because they were not authorized to comment publicly. “They’re going to find every possible way to make us take hard votes on that.”

Democratic defections

The resolution — which could pass the House as soon as today — has put some Democrats in the awkward position of defying the president.

• Sen. Robert P. Casey Jr. (D-Pa.), who represents a battleground state where Biden won by 80,555 votes in 2020, said in an interview that he would vote for the resolution because “China’s got to be held accountable.”

• Sen. Sherrod Brown (D-Ohio) — another red-state Democrat who is up for reelection in 2024 — said Wednesday he would vote to restore the tariffs. “The Chinese government will do anything to undermine American manufacturing, and would like nothing more than to kill the American solar manufacturing industry before it takes off,” Brown said in a statement.

• Senate Finance Committee Chair Ron Wyden (D-Ore.), one of the most protectionist senators, told reporters he would also vote for the proposal to support “red, white and blue manufacturing jobs.”

And Sen. Joe Manchin III (D-W.Va.), who chairs the Energy and Natural Resources Committee, said he was fed up with U.S. reliance on China for its energy transition. “I cannot fathom why the Administration and Congress would consider extending that reliance any longer and am proud to join this CRA to rescind the rule,” he said in a statement. 

The consequences

If tariffs were reimposed, leaders in the U.S. solar industry say the impact on jobs and climate targets would be devastating.

• The Commerce investigation carries the threat of retroactive tariffs. That means if the two-year pause is lifted, U.S. solar developers could be forced to pay $1 billion in retroactive fees, according to the Solar Energy Industries Association. 

• The resulting uncertainty in the industry would eliminate 30,000 well-paying jobs and $4.2 billion in domestic investment, the group has estimated, while 4 gigawatts of solar projects would be canceled, increasing planet-warming carbon emissions by 42 million metric tons.

“I would have to lay off thousands of people,” said George Hershman, CEO of SOLV Energy, a San Diego-based developer of large solar projects around the nation. 

“When you are talking about jobs that cost $300 million to $400 million, you can’t stop and start them easily,” he added. “I don’t know why anyone would support this.”

On the Hill

Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.) today will unveil a discussion draft of legislation aimed at accelerating the permitting process for clean energy and transmission lines while ensuring community input, according to a copy of the proposal shared first with The Climate 202.

The lawmakers, who co-chair the House Sustainable Energy and Environment Coalition’s task force on clean-energy deployment, say they’re hoping to juice permitting negotiations after Democratic leaders tried unsuccessfully to pass a permitting bill from Sen. Joe Manchin III (D-W.Va.) last year.

“We were very frustrated that the only vehicle that was being discussed for permitting reform was the Senate Manchin package, which frankly has got a lot of completely unnecessary oil and gas provisions,” Casten told The Climate 202. “There has never been a proper package with the right policies.”

The Clean Electricity and Transmission Acceleration Act differs significantly from Manchin’s measure as well as the permitting provisions in House Republicans’ energy package, which passed the chamber last month and primarily focused on boosting fossil fuel projects.

The legislation would accomplish the following goals, according to a section-by-section summary from Casten’s office:

• Give the Federal Energy Regulatory Commission siting authority for national interest transmission lines, or those that cross at least two states and have a capacity greater than 1,000 megawatts.

• Establish an Office of Electricity Transmission at the commission.

• Authorize $2.1 billion to address the shortage of electricity transformers through the Defense Production Act.

• Require federal agencies to hold multiple hearings in environmental justice communities on proposals that affect them.

Casten expressed confidence that these proposals could garner broad support within the Democratic conference, although he acknowledged that most Republicans would probably reject them in favor of the GOP energy package.

“We’ll see what happens on the politics,” he said. “But you’ve got to define what your policy goals are.”

The Senate on Wednesday voted 50-49 to advance a GOP-led effort to revoke the Environmental Protection Agency’s new rule aimed at slashing tailpipe pollution from heavy-duty trucks, Rachel Frazin reports for the Hill.

Sen. Joe Manchin III (D-W.Va.) was the only Democrat to vote with Republicans on the Congressional Review Act resolution. 

Proponents of the rule argue that curbing nitrogen oxide pollution from trucks can help protect public health and prevent childhood asthma cases. But critics say it would increase burdens on the trucking industry and worsen inflation. 

Despite the resolution’s approval, President Biden said Wednesday he would veto it if it landed on his desk. And the effort is unlikely to receive enough Democratic support to gain the two-thirds majority needed to override a veto.

House Republicans on Wednesday approved a bill that would raise the debt ceiling, slash federal spending and repeal some of President Biden’s programs to combat climate change, The Washington Post’s Tony Romm, Marianna Sotomayor and Leigh Ann Caldwell report. 

The 217-215 vote escalated a high-stakes feud with the White House, with as few as six weeks left before the government could default. The bill would roll back many of the clean-energy tax credits created by the Inflation Reduction Act, including those for electric vehicles and wind and solar energy. 

Rep. Nancy Mace (R-S.C.) — who on Tuesday threatened to vote against the bill because of concerns about scrapping clean-energy subsidies — ultimately supported the measure. Midwestern Republicans also backed the bill after GOP leadership agreed late Tuesday to restore tax credits for corn-based ethanol and other biofuels.

The only four Republican defections were Reps. Matt Gaetz (Fla.), Tim Burchett (Tenn.), Ken Buck (Colo.) and Andy Biggs (Ariz.), all members of the far-right House Freedom Caucus.

The Senate Environment and Public Works Committee on Wednesday voted along party lines to advance the nominations of two of President Biden’s top picks for key Environmental Protection Agency roles, months after deadlocking on both. 

By a vote of 10-9, the panel approved the nomination of Joseph Goffman to helm the agency’s Office of Air and Radiation, which he has led on an acting basis since January 2021. The panel deadlocked 10-10 on the nomination in November, with Republicans criticizing Goffman’s role in writing the Obama-era Clean Power Plan that aimed to significantly cut planet-warming pollution from power plants.

Lawmakers also approved the nomination of David Uhlmann, Biden’s pick for the EPA’s Office of Enforcement and Compliance Assurance, by voice vote. The office holds companies accountable when they violate the nation’s environmental laws.

In addition, the committee on Wednesday approved bipartisan legislation to improve the nation’s recycling and composting systems. The Recycling and Composting Accountability Act is co-sponsored by Chair Thomas R. Carper (D-Del.), ranking member Shelley Moore Capito (R-W.Va.) and Sen. John Boozman (R-Ark.). 

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: President Gustavo Petro has seen some of his signature proposals stall in Congress or run into political opposition.

PHOTO: OLIVER CONTRERAS/BLOOMBERG NEWS/ Editing Germán & Co

Colombia’s President Replaces Market-Friendly Finance Minister in Cabinet Reshuffle

The changes come in the wake of the breakup of his governing coalition and prompt the peso to weaken

WSJ By Juan Forero, April 26, 2023 

BOGOTÁ, Colombia—Colombian President Gustavo Petro, a leftist who has pressed for broadscale social reforms in eight months in office, replaced his market-friendly finance minister on Wednesday amid the breakup of his congressional coalition.

José Antonio Ocampo, a Columbia University professor who was seen by the markets as a stabilizing force, was replaced as finance minister in a cabinet shuffle that saw seven ministers ousted. The shake-up weakened the long-battered Colombian peso and sent bonds tumbling.

The Colombian stock market’s benchmark Colcap index fell 1%, and the peso weakened 3.1% to 4,641 against the U.S. dollar from 4,496 on Tuesday.

“This is going to generate uncertainty and lots of nervousness in the markets,” said Daniel Mejía, an economist at Los Andes University. “The departure of Ocampo is a very serious development for the Colombian economy.”

José Antonio Ocampo was replaced as Colombia’s finance minster on Wednesday.

The removal of ministers in the 19-member cabinet came as Mr. Petro, a former leftist guerrilla, has seen some of his signature proposals stall in Congress or run into political opposition.

A ruling coalition that had included centrist and conservative parties had crumbled in recent weeks as the president pressed for broad changes in a healthcare system that polls showed most Colombians favor. Other far-reaching proposals by Mr. Petro include starting peace talks with armed groups, undertaking a land redistribution for poor farmers, transitioning from oil to renewable energy, and a pension overhaul.

In a statement posted on his Twitter page, the 63-year-old leader said officials “will persist with our program and our vocation for big national accords.”

“We reaffirm our commitment to remain loyal to the popular mandate we have received,” he said in the statement, “and we have decided to create a cabinet to redouble our agenda for social change for the great majority of citizens.”

Ricardo Bonilla, who headed the finance department for Bogotá when Mr. Petro was mayor, is the new finance minister. Mr. Petro also replaced his ministers of interior, agriculture and health, sectors the president has said need far-reaching changes to improve the lives of poorer Colombians. Mr. Petro had already won approval for higher taxes, and has called for more spending on the poor.

Mr. Bonilla said via Twitter that he would “maintain economic stability.”

A longtime aide to Mr. Petro, Mr. Bonilla was known as having a steady hand during his time in Bogotá City Hall. But Sergio Guzmán, director of the political consulting firm Colombia Risk Analysis, said the markets may question him in his new role and whether he can damp inclinations Mr. Petro might have to increase spending.

“Will Ricardo Bonilla be able to stand up to the president and say no when proposals imply economic risk?” Mr. Guzmán said. “I think the markets don’t perceive Bonilla as independent, as having the political clout to be able to say no to Petro.”

*—Jenny Carolina González and Anthony Harrup contributed to this article.

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Image: The key lesson for the EU from previous financial crisis is the importance of developing an overall economic security strategy | Yuri Kadobnov/AFP/ Editing by Germán & Co

The EU lacks a credible economic security strategy

The bloc needs to develop a strategy that anticipates future threats and leverages its most valuable security asset — its position as the largest economy in the world.

POLITICO EU BY TOM KEATINGE, APRIL 27, 2023 

Tom Keatinge is the founding director of the Center for Financial Crime and Security Studies at the Royal United Services Institute.

In the summer of 2014, newspaper headlines were unanimous: Western nations had responded to the Kremlin’s annexation of Crimea and its complicity in shooting down a Malaysian passenger airliner in Ukrainian airspace by imposing sweeping economic sanctions against Russia. The reality of the European Union’s actions, however, is rather different.

The EU provides a handy timeline of the restrictive measures it’s imposed on Russia over the past nine years — and it is a record of inaction and failure.

Compared to the sanctions imposed over the past 12 months to “cripple the Kremlin’s ability to finance the war,” the 2014 measures were far from sweeping. And, in a lesson for today’s political leaders, interest in maintaining economic pressure on Russia and its war machine evaporated quickly, with key members of the bloc doubling down on economic engagement with its belligerent neighbor, perpetuating a misconstrued notion of Wandel durch Handel, or “change through trade,” instead.

It was an approach that left Russia’s military with continued capacity to develop weaponry, import needed components and stock its arsenal for the onslaught on its peaceful neighbor, despite clearly failing to meet President Vladimir Putin’s ambitions. But just imagine the extent to which eight years of properly implemented and maintained economic restrictions on Russia’s military could have neutered the Kremlin’s aspirations in Ukraine.

And here lies the EU’s central failing — it manages from “crisis to crisis.” Radical thinking and remediation only occur when vulnerabilities are exposed and action is forced upon Brussels.

Consider the series of steps taken by the European Commission on a topic like money laundering, triggered in the main by revelation and scandal. Changes and improvements are only a function of milestone events like the Panama Papers — leaked documents on offshore entities and the financial activities of politicians — or the exposure of extreme failings, such as the case of the Danske Bank Estonia scandal.

Similarly, in confronting Russia’s full-scale invasion of Ukraine in 2022, the EU has been running fast just to stand still. Eurocrats and their counterparts across member countries hurried to design and agree on a raft of sanctions packages, which are genuinely sweeping. Meanwhile, with the appointment of a sanctions envoy and having recognized that member country implementation and third country compliance aren’t yet what they should be, revisiting the substance of last year’s work is now an important task for 2023.

But, again, all of this is reactive. New structures, directives and regulations are built on the ashes of disaster. However, managing from crisis to crisis isn’t a strategy — it’s a sign of failure.

So, what should the EU do? What lessons should it learn from the last 12 months of frantic activity?

The key lesson is the importance of developing an overall economic security strategy —one that not only ensures the reliability of the supply chains the EU counts on, but one that recognizes and leverages the bloc’s position as the largest economy in the world, the top trading partner for 80 countries and the world’s largest trader of goods and services.

This is an unrivaled position, yet a security strategy based on the EU’s economic dominance is absent.  And while championing “openness” is to be applauded, it can become an existential vulnerability when accompanied by naivety.

The key lesson is developing an overall economic security strategy that recognizes the bloc’s position as the world’s largest trader of goods and services | Adrian Dennis/AFP via Getty Images

Of course, some member countries have already gone ahead with this, weaning themselves off Russian energy supplies, “de-Russifying” their economies to the greatest extent possible without waiting for Brussels to lead. But a fragmented, ad hoc and reactive response to such future security crises will once again expose the EU as weak and unprepared.

And on no topic is the issue of economic security more pressing than it currently is with China.

The magnitude of economic connections between the EU and China makes the failure to prioritize the development of an economic security strategy — even if it means reversing the EU’s dearly held vision of being an open and competitive economy — grossly irresponsible. EU leaders should be engaging with like-minded partners — notably the United States — to develop a collaborative economic security strategy that leverages the strengths and opportunities each has to offer — not taking sycophantic and grandstanding trips to Beijing.

And while, for some, government involvement in the private sector might herald a return to the inept government-led industrial strategies of the 1970s and early 1980s, economic security in the 21st century is going to require close collaboration between policymaking and private sector investment. The instincts of the profit-centered industrialist are going to need to be guided by smart, forward-thinking government policies, which incentivize investment decisions that don’t expose a nation to unacceptable economic security risks.

From critical minerals to foreign direct investment and technology supply chains, security — and partnership with allies — should be at the center of decision-making. And it shouldn’t be merely defensive either.

Utilizing their wealth and trading opportunity, Western nations should be securing expanded alliances around the world with countries facing an “East vs. West” choice. Yet, the harsh reality is that while the EU has vacillated, China has forged economic alliances in its favor across the world, and Russia has secured support — or at least acquiescence — via its provision of security.

So, yes, 2023 should be about ensuring the greatest possible restrictions are placed on the Russian economy and its ability to fund and resource its illegal war in Ukraine. But it should also be about thinking ahead, learning lessons from failed policy and ensuring the EU develops an economic security strategy that anticipates future threats and leverages its most valuable security asset — namely, its position as the largest economy in the world.

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Image:  Off-shore wind turbines in the North Sea are essential to reach global climate goals | Pool photo by Christian Charisius/AFP/ Editing by Germán & Co

The North Seas can be the world’s biggest power plant

Tomorrow, we will be taking another crucial step toward a green and independent Europe.

POLITICO EU BY ALEXANDER DE CROO, MARK RUTTE, XAVIER BETTEL, EMMANUEL MACRON, OLAF SCHOLZ, LEO VARADKAR, JONAS GAHR STØRE, RISHI SUNAK AND METTE FREDERIKSEN, APRIL 23, 2023 

Alexander De Croo is the prime minister of Belgium. Mark Rutte is the prime minister of the Netherlands. Xavier Bettel is the prime minister of Luxembourg. Emmanuel Macron is the president of France. Olaf Scholz is the chancellor of Germany. Leo Varadkar is the prime minister of Ireland. Jonas Gahr Støre is the prime minister of Norway. Rishi Sunak is the prime minister of the United Kingdom. Mette Frederiksen is the prime minister of Denmark.

We need offshore wind turbines— and we need a lot of them.

We need them to reach our climate goals, and to rid ourselves of Russian gas, ensuring a more secure and independent Europe.

Held for the first time last year, Denmark, Germany, Belgium and the Netherlands came together for the inaugural North Sea Summit in the Danish harbor town of Esbjerg, setting historic goals for offshore wind with the Esbjerg Declaration. It paved the way for making the North Seas a green power plant for Europe, as well as a major contributor to climate neutrality and strengthening energy security.

This Monday, nine countries will meet for the next North Sea Summit — this time in the Belgian town of Ostend — where France, Ireland, Luxembourg, Norway and the United Kingdom will also put their political weight behind developing green energy in the North Seas, including the Atlantic Ocean and the Irish and Celtic Seas. Together, we will combine and coordinate our ambitions for deploying offshore wind and developing an offshore electricity grid, putting Europe on the path toward a green economy fueled by offshore green power plants.

Collectively, our target for offshore wind in the North Seas is now 120 gigawatts by 2030, and a minimum of 300 gigawatts by 2050 — larger than any of the co-signatories’ existing generation capacity at a national level. And to deliver on this ambition, we are committing to building an entire electricity system in the North Seas based on renewable energy by developing cooperation projects.

This is a massive undertaking and a true example of the green transition in the making. It also requires huge investments in infrastructure, both offshore and on land.

It presents us with a political and environmental dilemma as well: We are facing a climate crisis at the same time some of our ecosystems are in decline, and offshore wind is an integral part of both climate action and safeguarding our energy security. Thus, time is of the essence, and we must follow up on the progress already made on reining in the burden of bureaucracy for renewable projects.

We cannot wait years for permitting processes while global temperatures rise, and autocratic regimes have the power to turn the lights off in our living rooms and halt production in our industries. Instead, we must work toward rapid deployment of offshore wind, while making every effort to safeguard our healthy and robust marine ecosystems for future generations.

Crucially, the green transition is also a cornerstone for maintaining our competitiveness in the global economy. And while the North Seas will be a major provider of clean, affordable energy for our industries and businesses in the form of electricity and hydrogen, we must ensure we don’t simply move from one dependence to another. As such, we need to make space for European value chains when it comes to green tech and diversify our sources of critical raw materials for wind turbines, batteries and the like. We will work together within NATO and the European Union to increase the security of offshore and underwater infrastructure, stepping up efforts to react effectively to growing traditional and hybrid threats.

Tomorrow, we will be taking another crucial step toward a green and competitive Europe, with even more turbines spinning in the North Seas. And every turbine gets us closer to a green future.

We know the way — now, it’s a matter of picking up the pace.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image: NATO needs to address the fact that deterrence can no longer be seen as just a bipolar equation when it comes to nuclear weapons | Sean Gallup/Editing by Germán & Co

Facing Europe’s nuclear necessities

Deterrence can no longer be seen as just a bipolar equation — and it’s time NATO addresses this fact.

POLITICO EU BY MAXIMILIAN TERHALLE AND KEES KLOMPENHOUWER, APRIL 22, 2023 

Maximilian Terhalle is a visiting professor of strategic studies at the London School of Economics (LSE IDEAS). Kees Klompenhouwer is a former Ambassador of the Netherlands.

The euphoria in NATO surrounding Finland’s new membership demonstrates a grim reality: Russia’s brutal invasion of Ukraine has searingly exposed Europe’s strategic vulnerability.

It is clear now that the West’s war efforts thus far would have been inconceivable without the United States, and Russia’s shrill nuclear rhetoric has been slowly degrading the Continent’s long-standing political unwillingness to address the nuclear elephant in the room.

With only a handful of strategic thinkers engaged with the nuclear problem, for years this issue has gone largely unnoticed, and curiously, former U.S. President Donald Trump’s departure from power has faded his threats to leave NATO from European memory. As the 2024 U.S. presidential election may once again result in an isolationist Republican victor, however, doubts regarding Washington’s nuclear defense commitment to Europe may well soon return.

Meanwhile, China’s revisionist ambitions — a bipartisan concern for the U.S. — are stretching America’s role of security guardianship to an extent that the U.S. could eventually be obliged to make some hard choices. And as intimated by former Defense Secretary James Mattis’s succinct response of “No, Sir!” when asked whether America could fight two major wars simultaneously, these choices wouldn’t be to the advantage of European security.

As such, deterrence can no longer be seen as just a bipolar equation — and it’s time NATO addresses this fact.

In 2011, as part of the “New START” nuclear arms reduction treaty — which imposed limits on deployed long-range nuclear weapons — both Russia and the U.S. had agreed on an equal number of said strategic arms. However, not only is this treaty set to expire by 2026, but Russian President Vladimir Putin recently suspended it.

In addition, China is currently aiming to increase the total number of nuclear warheads at its disposal from 400 to 1,000 in the next few years, it’s nuclear rise thus starting to shape a tripolar set of deterrence equations. This isn’t only undermining the notion of nuclear strategic parity and making U.S. deterrence much more difficult to manage, but it’s also contributed to the demise of the Intermediate-Range Nuclear Forces Treaty, which had limited the number of short- and intermediate-range — or sub-strategic — nuclear weapons in Europe, and a similar fate may now await the New START treaty too.

At the same time, Russia has been modernizing its sub-strategic nuclear arsenal as well, and consolidating its nuclear superiority when it comes to Europe. While Moscow now has 2,000 tactical nuclear warheads targeting the Continent; Europe has at its disposal merely 100 U.S. free-fall bombs that can be delivered by so-called dual-capable aircrafts (DCA) — i.e. fighter jets that could carry nuclear bombs into Russia. Otherwise, the United Kingdom has some 225 strategic nuclear warheads carried by submarines, while France has 290 strategic nuclear warheads of which approximately 50 are medium-range air to surface missiles (ASMP) — but that’s it.

Moreover, Russia has now developed a hypersonic glide missile that’s nuclear capable and with a range of 2,000 kilometers, against which there is apparently no current effective defense.

Crucially, this combination of China’s aggressive nuclear weapons program, Russia’s growing sub-strategic nuclear superiority over Europe, and possible renewed American isolationism would spell the erosion of the U.S. nuclear umbrella’s global credibility, pushing nations in East Asia and Europe to come up with national solutions — something that would effectively spell the end of the Nuclear Non-Proliferation Treaty, which is the cornerstone of nuclear arms control.

This means that China is essentially changing the strategic calculations that NATO allies have to make.

Russia’s brutal invasion of Ukraine has searingly exposed Europe’s strategic vulnerability | Alexander Nemenov/AFP via Getty Images

As U.S. and Chinese political rhetoric have escalated, diplomatic relations between the two great powers have dangerously deteriorated. China now also appears determined to exercise sovereign control over Taiwan and the Western Pacific — something that will be difficult to deter. And though neither side is yet militarily ready for a direct confrontation, if diplomacy and statecraft fail, a military confrontation over Taiwan will become more likely — not least since the U.S. president has pledged to intervene directly in such a case, despite formally recognizing China’s sovereignty over Taiwan.

In such a scenario the U.S. would then have to withdraw military assets from Europe, and European allies would be called upon to provide the bulk of the conventional force in the European theater to defend and deter against Russia.

Thus, NATO now needs to think much harder about how to prepare the alliance prior to such a worst-case scenario, and this reevaluation needs to include the question of what the alliance should do in the nuclear realm — a question so far left untouched.

And critically, rethinking NATO’s nuclear strategy in this way will likely lead to the alliance abandoning some of the axioms it now holds.

For instance, based on global American strategic supremacy, the very idea of autonomous European defense has long been considered detrimental to the vital transatlantic link. However, with global strategic challenges growing fast, this principle is no longer tenable. And while addressing this will be a major political challenge, there’s an undeniable need for a new approach that strengthens NATO by compensating for foreseeable gaps in the transatlantic nuclear deterrence posture.

Three mutually reinforcing paths could provide a way forward here: First, upgrading the U.S. contribution to European sub-strategic nuclear deterrence, modernizing weapons and enlarging the number of DCA-capable nations in Europe. Second, starting a new dialogue on how the independent French and British deterrents could fit into this strategy. And third, nonnuclear European allies’ strengthening their conventional forces to support NATO’s overall deterrence strategy, including the link to U.S. nuclear deterrence.

Given today’s growing challenges, now is the time for NATO to adapt its concept of “peace through strength.” And in order to do so, it must rethink its nuclear deterrence strategy — there is no time to waste.

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Image: Illustration by Owen D. Pomery

The Climate Crisis Gives Sailing Ships a Second Wind

Cargo vessels are some of the dirtiest vehicles in existence. Can a centuries-old technology help to clean them up?

The era of sailing ships may seem like a distant memory, but it's important to remember that they were only partially replaced by diesel vessels. The Avontuur, a sailing schooner constructed in 1920 by a Dutch shipyard, is a prime example. Despite being over 90 years old, the Avontuur operated as a passenger liner on the Dutch coast in 2012. However, the United Nations issued a climate assessment that year, warning that the planet was heading towards a future of extreme weather conditions and disasters caused by intensifying heat waves, fires, and storms. We must take action and end our reliance on fossil fuels before it's too late.

Germán & Co

The New Yorker By Pagan Kennedy, April 27, 2023

In February, 1912, Londoners packed a dock on the River Thames to gawk at the Selandia, a ship that could race through the water without any sails or smokestacks. Winston Churchill, then the minister in charge of the British Royal Navy, declared it “the most perfect maritime masterpiece of the twentieth century.” But, as the Selandia continued its journey around the world, some onlookers were so spooked that they called it the Devil Ship.

The Selandia, a Danish vessel that measured three hundred and seventy feet, was one of the first oceangoing ships to run on diesel power. So-called devil ships inaugurated a new age of petroleum on the high seas; by the twenty-first century, nearly ninety per cent of the world’s products spent time on diesel-powered vessels. The shipping industry created a mind-bending supply chain in which an apple from halfway around the world often costs less than one from a nearby orchard.

Diesel ships never entirely stamped out the sailing ships that once reigned supreme, however. In 1920, a Dutch shipbuilder fashioned a sailing schooner named the Avontuur and put it to work carrying cargo, which it did for the rest of the century. By 2012, the Avontuur was ferrying passengers on the Dutch coast; at more than ninety years old, it probably seemed destined for a maritime museum or a scrap heap. But that year a United Nations climate report warned that the planet was careening toward an era of extreme weather and disasters, in which escalating heat waves, fires, and storms could become the norm. Humans had the power to avert these crises—but only if they took rapid action to end their dependence on fossil fuels.

Two years later, Cornelius Bockermann, a German sea captain who had worked with oil companies, bought the Avontuur and made it the flagship of a company called Timbercoast. His mission was to eliminate pollution caused by cargo shipping. Bockermann had witnessed the harms of diesel ships; on the high seas, beyond the reach of most environmental regulations, the descendants of the Selandia burn millions of gallons of thick sludge left over from the oil-refining process. The shipping industry, he knew, was one of the dirtiest on the planet, spewing roughly three per cent of the world’s climate pollution—as much as the aviation industry. After having the Avontuur restored, he captained the ship, hired a small crew, recruited some volunteer shipmates, and put the vessel back to work. It could carry only about a hundred tons of cargo—a tiny amount compared with the more than twenty thousand tons that a container ship can carry—but customers hired Timbercoast to deliver coffee, cocoa, rum, and olive oil.

Bockermann’s company is one of several founded on a provocative idea: What if shipping’s history could inspire its future? For centuries, the cargo industry ran on clean wind power—and it could again. As the climate crisis has escalated, and the pandemic has exposed weaknesses in global supply chains, the movement to decarbonize shipping has spread. What was once the dream of a few enterprising idealists has become a business opportunity that startups and sprawling multinationals alike are chasing.

Christiaan De Beukelaer, an anthropologist who was researching the nascent field of eco-friendly shipping, came aboard the Avontuur as a shipmate in February, 2020. He was about three weeks into his voyage when, on March 17th, the ship’s temperamental dot-matrix printer spewed out an emergency message that Bockermann had sent from shore. “The world as you know it no longer exists,” the dispatch said. Coronavirus lockdowns had shut borders and ports in dozens of countries. De Beukelaer and the rest of the crew were now marooned indefinitely aboard the Avontuur.

In the Gulf of Mexico, they rediscovered the difficult realities of wind-powered transport. “We were going around in circles, taking the sails down and up again because of the squalls,” De Beukelaer told me. The ship zigzagged for weeks, and supplies dwindled. After the fruits and vegetables were gone, the crew ate short rations. The cook worried that they’d run out of gas for the stove. But elsewhere, the pandemic was revealing just how vulnerable the entire shipping industry might be.

In 2020, with so many ports clogged and ships stuck at sea, store shelves emptied, and customers waited months for items such as cars and refrigerators. The following year, the Ever Given, a container ship about the size of the Empire State Building, ran aground in the middle of the Suez Canal. It delayed shipping traffic between Europe and Asia for months, a seeming metaphor for a world held hostage by diesel-guzzling behemoths. Oil prices rose while tankers, carrying almost ten per cent of the world’s daily oil consumption, waited their turn. A meme christened the ship the Least Fucks Ever Given.

Shipping’s sudden visibility reinvigorated activist organizations, which have long pressured cargo owners to clean up their operations, De Beukelaer told me. Members from the environmentalist group Extinction Rebellion spun off a political-art collective called Ocean Rebellion; its inaugural demonstration projected messages like “TAX SHIPPING FUEL NOW” onto the side of a cruise ship. In 2021, a consortium of climate and public-health groups launched the Ship It Zero campaign, calling on big retailers, including Target and Walmart, to transport their products with cargo carriers that are “taking immediate steps to end emissions,” and to “sign contracts now to ship your goods on the world’s first zero-emissions ships.”

In January, De Beukelaer published “Trade Winds,” a book about his five months at sea during the pandemic. His story doubles as a plea to clean up the shipping industry. It takes “fifty thousand Londons worth of air pollution,” he writes, to ship eleven billion tons of cargo each year—about one and a half tons for each person on the planet. In his view, consumers and corporations must take responsibility for the environmental mayhem that they cause. And they can start to do that, he writes, if sailing ships make an epic comeback.

For wind power to push the shipping industry forward, it will need to reach the biggest players in the business. In 2018, Cargill, the largest privately held American company, pledged to cut its direct greenhouse-gas emissions by ten per cent within seven years. Five months later, the company’s maritime division, which manages a fleet of about six hundred ships, announced a CO2 Challenge. Inventors around the world were invited to propose novel ways to reduce carbon emissions of cargo vessels.

Cargill transports more than two hundred million tons of cargo, including soybeans, fertilizers, and iron ore, each year. It’s not easy to decarbonize such a sprawling business; in 2017, Cargill’s global operations emitted as much as several million cars. That same year, an environmental group, Mighty Earth, reported that the company was fuelling deforestation in South America, by buying soybeans in places where megafarms were swallowing woodlands. Because forests store carbon, deforestation has a major carbon footprint. (Cargill once pledged to eliminate deforestation from its supply chains by 2020, but says it is now working toward a target of 2030.)

The CO2 Challenge identified other areas in which Cargill could reduce its climate pollution. “We opened it up to everyone out there,” Jan Dieleman, the head of the division, told me. “We got something like a hundred and eighty ideas, including some crazy ones.” One proposal suggested freezing CO2 emissions into dry ice. Another recommended nuclear-powered ships. A third went so big on batteries that it left little room for cargo. Some of the winning entries sounded as daffy as the rejects. One of them, from a startup called BAR Technologies, imagined airplane-style wings rising nearly a hundred and fifty feet from the deck of a cargo ship.

The idea of powering ships with rigid wings dates back at least to the nineteen-sixties, when an English aeronautics engineer named John Walker spent his weekends in a cranky, old yacht. One day, he was hopping around the cockpit, trying to coax the mainsail to swing into position, and he failed to notice that a rope had wrapped around his ankles. When the sail caught the wind, the rope pulled him into the air. After that humiliating incident, he began to wonder why sailboats had evolved so little in hundreds of years. Wasn’t there some way to improve on this messy system of ropes and booms?

In 1969, news footage showed Walker—a trim and bearded Old Spice sort of man—at the helm of what he called the Plane-Sail Trimaran. Piloting the boat, he once said, felt like flying a plane. Where the mainsail should have been, four rigid sails stuck straight up into the air, like window blinds turned vertically; each one had the shape of an airfoil and generated forward thrust. They also allowed him to carve the wind with more control than a cloth sail would allow: instead of turning the entire boat at an angle to catch the wind, by either tacking or jibing, Walker could simply spin a crank, and the wings above his head would swivel into a configuration that would drive the boat forward, sideways, or even in reverse. He became obsessed with his creation. “My wife complained that I’m not the man she married and she is right,” he told a reporter, in 1970.

During the energy crisis of the nineteen-seventies, Walker wondered whether his winged yacht could also help to solve environmental problems. He founded a company called Walker Wingsails, built demonstration vessels, and, in 1989, advertised a “wingsail cruising yacht” with “fingertip control by a single person.” His vision of no-emissions shipping now seems far ahead of its time. “Using only the free clean ocean winds, the Walker wingsail technology can make a valuable contribution to the control of pollution and the greenhouse effect,” the ad declared. In 1991, the New York Times deemed his winged innovation “the most radical sailboat to ever slip into the harbor.” But not all the reviews were positive. A few years later, when a sailing magazine questioned the performance of his wings, Walker sued for libel and became tangled up in a high-profile case. Though he eventually won, his company went bust.

Around the turn of the twenty-first century, boat designers experimented with winglike sails for a different reason: they wanted to break speed records on racing yachts. Competitors in the America’s Cup, the most prestigious U.S. yacht prize, showed that a combination of rigid wing sails and hydrofoils, which work like underwater airplane wings, propels the yachts along the surface of the water. The winged catamarans, which looked like seabirds skimming for fish, proved to be so blazingly fast that in 2010 the Cup put them into a class of their own. After the Cup banned competitors from testing out their models in water tanks or wind tunnels, many of the teams embraced computer modelling and created elaborate simulations of yachts gliding across virtual oceans.

In advance of the 2017 America’s Cup, a British team hired a group of engineers and created one of the world’s most powerful wing sails. Their entry lost the race, but the designers weren’t ready to part ways and instead spun off BAR Technologies. The team decided, “We’re not going to lose all these great people, and we’re not going to lose all these simulation tools,” John Cooper, the company’s C.E.O., told me. A year later, it won a contract with Cargill to fit its proprietary wing sails, WindWings, onto a bulk carrier.

A diesel ship retrofitted with wing sails could reduce its fuel consumption by as much as thirty per cent, according to a BAR Technologies simulation. When I ran that figure by Elizabeth Lindstad, a chief scientist at sintef Ocean, an independent think tank that advises maritime companies, she described it as optimistic but possible, at least along trade routes with the right wind conditions. Paul Sclavounos, a professor of naval architecture and mechanical engineering at M.I.T., agreed. Savings on that scale, he said, could reshape the economics of shipping. Many multinational companies, including Cargill, lease their vessels from shipbuilders and pay for fuel expenses. It can cost more than twenty-four thousand dollars per day to fuel a bulk carrier; a company that adds wing sails to one ship could save thousands per day, and “pay back its investment in a year or two,” Sclavounos told me. The wings could then provide decades of propulsion for only the price of maintenance. “It’s clearly a relatively inexpensive technology,” he said. “It makes a lot of sense.”

Wind propulsion will help some ships more than others. Container ships are responsible for about twenty-three per cent of shipping emissions, according to a report from the International Council on Clean Transportation, but it’s difficult to squeeze sails onto a deck that’s cluttered with metal boxes. In contrast, bulk carriers, which are responsible for roughly nineteen per cent of shipping emissions, are perfect laboratories for wind propulsion, thanks to their open decks and relatively small size. The same goes for more specialized vessels that carry vehicles such as cars, trucks, and trains. These Ro-Ro ships—short for “roll on, roll off”—don’t need any help from cranes when they sail into port, and they tend to stash their cargo in a hold, leaving plenty of room on deck for sails.

Of course, you can’t just slap an airplane wing onto the deck of a ship and expect it to work. Airplane wings provide lift, but rely on jet engines to provide thrust; a wing sail, in contrast, must provide thrust of its own. Engineers are now studying how many wings they can cram onto the deck of a ship, and how high they can go without threatening the stability of the vessel. Some are building wing sails that fold or telescope so that they don’t bump into bridges or cranes. Cargill plans to try out its first set of WindWings on a commercial route in early July; BAR Technologies is also installing WindWings on a ship owned by Berge Bulk this year. Cooper told me, “If you fast-forward three or four years, we’re looking at building hundreds of wings.”

Adiesel ship that’s retrofitted with wing sails will pollute much less than its peers—but it still won’t be clean. “We know that wind alone is not going to bring us to zero carbon,” Dieleman told me. In the future, ships will likely need to swap out dirty fuels for alternatives with low carbon footprints. Cargill has four vessels in production that run on methanol, which produces far lower emissions at sea. At the moment, though, most of the methanol on the market is “brown,” Dieleman said—in other words, made from fossil fuels. Bio-methanol can be made from agricultural waste or seaweed, and another fuel, green hydrogen, can be generated from water and clean electricity. But they are still a kind of Unobtanium, because no one has yet figured out how to produce trillions of gallons at low cost.

Then again, why not rethink cargo ships entirely—from the keel up—so as to squeeze as much power as possible from the wind? Lindstad, the scientist at sintef Ocean, and her research partners have argued that the ships of the future should combine wind propulsion with slender hulls that reduce drag. They estimate that some vessels designed in this way could cut down fuel use by as much as fifty per cent. Cargo ships may also need to chart new courses, following trade winds that were largely ignored in the age of diesel.

A few months ago, I travelled to Lunenburg, Nova Scotia, a Canadian port town known for its fisheries and shipyards, to meet Danielle Southcott, a sustainable-shipping entrepreneur who’d recently moved there. On the day we met, in a loft that serves as an event space, she was introducing her company, Veer Group, to about fifty people, mostly from the local shipping community. The crowd was a blur of leather jackets, scruffy beards, interesting glasses, and knit caps: artsy, but also appropriately attired to carve a mizzenmast or hack some barnacles off a hull. Southcott, at thirty-three, fit right in—she wore all black, and her long, dark hair curtained her face each time she glanced down at her notes.

When she flashed a rendering of a sailing ship onto the screen, I could sense the collective puzzlement in the room. It looked like the ghost of a traditional three-masted clipper, with no visible cables or ropes.

A man raised his hand. “I don’t see any rigging,” he said.

Southcott explained that Veer was using a sailing system called the DynaRig, which had been tested on two luxury yachts, the Maltese Falcon and the Black Pearl. Though the sails are made from cloth rather than rigid panels, they have something in common with wing sails: they’re shaped much like broad airplane wings and are controlled through a computer. Each mast can rotate more than a hundred and eighty degrees.

The ideal cargo for Veer’s first ship, Southcott said, would be something like designer shoes: they have high markups and low weights, and customers pay a premium for the latest and greatest. Imagine the fashionistas, she went on, who would pay upmarket prices for net-zero delivery. According to design plans, the ship could attain speeds of eighteen knots, or more than twenty miles per hour, on wind alone. As she explained her stiletto-heeled business model to her steel-toe-boot audience, the mood seemed to shift from skepticism to glee. She was questioning a basic assumption in the shipping industry—the cheaper, the better—and imagining a new one: the better, the better.

Later that evening, some audience members decamped to a creaky wooden pub called the Knot, and I eavesdropped as two master mariners vented about the shoddiness of container ships. The ships would be more fuel efficient with rounded hulls, they observed, but they’re built like steel boxes to save money. The think tank at the bar agreed that a Veer-style ship would work just fine from a technical standpoint—one guy even assured Southcott that gantry cranes, which pluck boxes off of ships, would be able to maneuver around masts without knocking them over. But they wondered whether she could build a business in an industry that usually competes on rock-bottom prices.

In Southcott’s telling, the key variable for upscale retailers is not cost but speed. She’d learned that lesson in 2021, she told me, when she was running a company that built wooden sailing ships for freight delivery. Her potential clients were eager to lease a net-zero cargo vessel—but not if it plodded along so slowly that it added days or weeks to the delivery date. So she contacted a friend at Dykstra Naval Architects, a Dutch firm that designs classic and modern yachts. Southcott brought preliminary renderings of a Veer ship, to be built from composite materials and steel, to the cop26 climate conference, in Glasgow. Soon after she announced her venture, she raised six hundred thousand dollars from four investors. She used the money to hire Dykstra engineers to draw up technical plans for the first ship, and to assemble a startup team.

Southcott told me that her investors have now pledged more than two million dollars, enough for her to seek financing from a bank and submit bids to shipyards that could build Veer’s first ship. She hopes to build it in a country where she can use “green steel,” which is manufactured without fossil fuels. If she succeeds, she’ll be working in a new slice of the shipping sector—one that’s far smaller than the world of container ships and bulk carriers, but one with a clearer path toward zero emissions. The C.E.O. of Dykstra, Thys Nikkels, told me that, with souped-up sails and turbines that can charge batteries, it’s already possible to build a speedy ship with a small footprint. “On a sailing yacht, that’s quite feasible,” he said. “But it hasn’t been done on a commercially operated cargo vessel.”

There’s at least one other direction in which cargo ships could innovate: up. “The higher you go, the higher the wind velocity,” Mikael Razola, the technical director at Oceanbird, a Swedish company affiliated with the shipping company Wallenius Marine, told me. Oceanbird researchers have used lidar imaging to map wind pressure from the surface of the ocean to an altitude of nearly seven hundred feet. The company has designed wings for a Ro-Ro ship, set to launch next year, that will be outfitted with six towering wing sails that reach more than one hundred and thirty feet into the air. The wings will be paired with a special lightweight hull that is aerodynamic and reduces drag. The company claims that the design will reduce the ship’s emissions by a striking sixty per cent. But the trade-off for that efficiency is speed: on existing routes, the car carrier with sails will take days longer than other ships.

In February, I opened my laptop and beamed into a factory outside of Shanghai, where workers were hurrying to build WindWings for Cargill’s fleet. A representative of Yara Marine Technologies, which is leading the installation, had agreed to a virtual tour of the factory on the condition that I refrain from quoting the “cameraman”—a factory worker who walked me around the facility with his phone. As it turned out, the language barrier was big enough that my guide communicated mostly through gestures. He started his tour by pointing his phone at a simplified diagram of the wings, which looked like the instructions for some ikea furniture. A mast—basically, a metal tube with arms—would be fitted with panels to catch the wind; this assembly would sit on a swivelling base that could turn the wings around. The ikea vibes ended there. When my guide pointed his phone up, I saw the huge steel frame of a WindWing waiting to be filled with hydraulic piping and wiring for sensors, which will detect air pressure.

The guide walked me to a welding platform, where workers scurried around a mast that had been tipped onto its side. Laid horizontally, the steel frame turned into a kind of enormous hallway, with eight or ten feet of headroom for the welders who worked inside it. As I watched a man in white coveralls climb into the base of one of the masts, its scale sank in. The man looked like an action figure. The tour continued to a nearby dock, where the masts would be fitted onto ships. The wings would be so immense that they would block the sight lines across the deck, so, rather than navigating with the naked eye, the crew would depend on digital cameras.

One chapter in “Trade Winds,” De Beukelaer’s book about his voyages on the Avontuur, is titled “Ship Earth.” The planet, he writes, has something in common with a seagoing vessel. Earth is always at risk of a new emergency, and its inhabitants have little choice but to work together with finite resources. He quotes Ellen MacArthur, a British sailor who once set a world record for the fastest round-the-world voyage on a solo sailboat. “Your boat is your entire world,” MacArthur later said. “What we have out there is all we have. There is no more.” After retiring from sailing, in 2010, she created a foundation committed to creating a circular economy, which aims in part to eliminate waste and climate pollution.

De Beukelaer told me that when wind waylaid the Avontuur in the Gulf of Mexico, the crew agonized about dwindling supplies and looked for unconventional ways to use what they had. They tried reinforcing a sail with glue. They scoured the deck with a thermometer, looking for places where they might try solar cooking. When that failed, the bosun fashioned insulation pads for their cooking pots, which stretched out their limited supply of gas. At the end of their six-month voyage, the crew of the Avontuur published a joint statement. “We have learned—by stitching a patch on a torn sail, splicing together a frayed rope, being creative with limited resources—that nothing is ever truly broken,” they wrote. “Solutions and innovations abound when your whole world is contained within a steel hull.” 

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News round-up, April, 26, 2023

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Most read…

A new front in the water wars: Your Internet use

In the American West, data centers are clashing with local communities that want to preserve water amid drought

WP By Shannon Osaka, April 25, 2023

Eyes on the prize: Lula’s outbursts won’t deter EU from chasing Mercosur deal

Brazilian leader’s erratic geopolitics are testing the nerves of EU trade negotiators.

POLITICO EU BY CAMILLE GIJS AND SARAH ANNE AARUP, APRIL 25, 2023 

Belgium's De Croo: 'It's time for Europe to move away from a purely national approach on energy'

Belgian Prime Minister Alexander De Croo, who is hosting a summit of North Sea countries in Ostend on Monday, promotes coordinated development of renewables

LE MONDE By Jean-Pierre Stroobants(Brussels, Europe bureau) ,  Published on April 24, 2023

Who are the candidates for the 2024 US presidential election?

There are already seven candidates vying for the Democratic and Republican nominations, including frontrunners Joe Biden and Donald Trump.

Le Monde with AFP, Published yesterday at 11:27 pm (Paris)

Inside Biden’s Renewed Promise to Protect South Korea From Nuclear Weapons

President Biden’s emphasis on America’s willingness to defend South Korea is a striking admission that North Korea’s arsenal is here to stay

NYT By David E. Sanger and Choe Sang-Hun, April 26, 2023

France to continue subsidizing electricity bills until 2025

French Finance Minister Bruno Le Maire announced the extension as the country's electricity providers continue to suffer the effects of Russia's war in Ukraine.

Le Monde with AFP, TODAY

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Image: By Germán & Co 

A new front in the water wars: Your Internet use

In the American West, data centers are clashing with local communities that want to preserve water amid drought

WP By Shannon Osaka, April 25, 2023

When Jenn Duff heard that Meta, the parent company of Facebook, wanted to build yet another data center in Mesa, Ariz., she was immediately suspicious. “My first reaction was concern for our water,” Duff said. The desert city of half a million residents was already home to large data centers owned by Google, Apple and other tech giants, and Duff, a city council member, feared for the city’s future water supply.

“It’s not like we’re sitting fat and happy in water,” she said. “We’re still constantly looking at the drought situation.”

Mesa is only one of many cities and towns in the West wrestling with the expansion of water-guzzling data centers. For years, data centers have come under scrutiny for their carbon emissions. But now, as a “megadrought” continues to ravage the Southwest and the Colorado River dwindles, some communities charge that the centers are also draining local water supplies.

In The Dalles, Ore., a local paper fought to unearth information revealing that a Google data center uses over a quarter of the city’s water. In Los Lunas, N.M., farmers protested a decision by the city to allow a Meta data center to move into the area.

In a small Dutch town, a fight with Meta over a massive data center

More than 30 percent of the world’s data centers are located in the United States; the power required to run those centers already accounts for about 2 percent of the nation’s electricity use. As the data storage requirements of the planet escalate — and as water becomes scarcer because of climate change — these operations may attract greater scrutiny.

It’s common to think of the stuff of digital life — the photos, the videos, the webpages, the e-books, the reams and reams of data — as somehow lighter than air, existing in “the cloud” or zipping along global wireless networks. The reality, however, is much more concrete. The dozens of zettabytes of data produced every year (a zettabyte is a gigantic unit of data, equal to about 250 billion DVDs) are increasingly stored in thousands of data centers around the world, where massive servers keep the internet afloat.

Those servers require a great deal of energy and produce a great deal of heat. Without adequate cooling, the servers can overheat, fail or even catch fire. Companies can either use traditional air conditioning to cool the servers, which is expensive, or use water for evaporative cooling. The latter is cheaper, but it also sucks up millions of gallons of water. A large data center, researchers say, can gobble up anywhere between 1 million and 5 million gallons of water a day — as much as a town of 10,000 to 50,000 people.

According to a Virginia Tech study, data centers rank among the top 10 water-consuming commercial industries in the United States, using approximately 513 million cubic meters of water in 2018. Much of that water use comes from electricity use — coal, nuclear and natural gas plants take water to operate, and hydropower also consumes water — but about a quarter is due to using water for direct cooling.

The researchers also found that a lot of data centers operate where water is scarce.

Part of the problem is that tech companies put many of these centers in areas where power is cheap and low-carbon — such as Arizona or other states with plentiful solar or wind power — to help meet their own climate targets. Water in those regions is scarce. Meanwhile, areas where water is plentiful, like in the East, have higher-carbon sources of power.

“You have to think about how much of the western United States is water-stressed,” said Landon Marston, a professor of water resources engineering at Virginia Tech and one of the study’s authors. California, for example, has at least 239 data centers; desert Arizona has at least 49.

Ben Townsend, Google’s global head of infrastructure and water strategy, said there is a trade-off between using more water for cooling, thus saving precious drops, and using more energy for cooling through traditional air conditioning, which emits more greenhouse gases. The right combination depends on where the center is located.

Compared with agriculture and urban demands, data centers take up a small proportion of the West’s water. But in small towns and rural areas, the proportion can seem much larger, and spark conflict. In The Dalles, Google was embroiled in a 13-month legal fight to keep the water usage of its local data centers private. Eventually, the company disclosed that its data centers now consume more than 25 percent of the town’s supply. Google then became the first company to publicize its data centers’ water usage worldwide.

John DeVoe, adviser for the environmental group WaterWatch of Oregon, worries that data centers in The Dalles are taking away precious water that could be used to help support species in nearby wetlands and rivers. “It’s an already difficult situation where too much water is promised to too many interests,” DeVoe said. “And now you have a new use coming in and saying, ‘Hey, we want our share too.’”

In the nearby Cascade Locks, Ore., residents are also pushing back against a proposed data center that they worry will raise electricity rates and suck up precious water.

The good news is that data centers’ efficiency has improved dramatically over the past decade or so. In the mid-2000s, Marston said, researchers projected that data center electricity use would expand to take up huge proportions of the world’s electricity demand. But while data centers’ workloads increased fivefold between 2010 and 2018, their electricity consumption only increased 6 percent.

Still, as the world lives more and more online, data storage requirements are climbing. Newsha Ajami, director of urban water policy at Stanford University’s Water in the West center, said even if data centers’ water use is relatively small, the region’s long-term megadrought means every use is up for debate. “We have really limited amounts of water,” she said. “Every drop counts.”

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Germán & Co by Shutterstock

Eyes on the prize: Lula’s outbursts won’t deter EU from chasing Mercosur deal

Brazilian leader’s erratic geopolitics are testing the nerves of EU trade negotiators.

POLITICO EU BY CAMILLE GIJS AND SARAH ANNE AARUP, APRIL 25, 2023 

BRUSSELS — The European Union might have been put out by the latest anti-Western antics of Brazil's maverick president, but that's not going to deter it from pushing ahead to conclude a trade deal with Latin American countries that’s been in the making for decades. 

The EU is on a charm offensive as Brazilian President Luiz Inácio Lula da Silva tours Portugal and Spain — part of a courtship that seeks to mark progress on a deal with the Mercosur trading bloc at a major EU-Latin America summit in Brussels in July.

Lula's behavior of late has hardly helped the cause: He had been due to welcome European Commission President Ursula von der Leyen a couple of weeks back, but instead flew to China. There, he railed against the West in general, and the United States in particular, calling on Washington to "stop encouraging war” in Ukraine. Lula's comments triggered a storm of criticism from Washington and Brussels, amid concern that that the West had lost the Brazilian leader just months after he returned to power.

But in the corridors of power in Brussels, diplomats say the public acrimony won’t be enough to derail the crucial trade deal.

“Obviously, it is important to push back strongly against any comments that would look to question the realities of the war in Ukraine, wherever they come from," said one EU diplomat, speaking on condition of anonymity in order to freely discuss sensitive topics. “However, the EU doesn’t take such big decisions based on issues like this. Mercosur is an important long-term strategy.”

Europe sighed with relief after Lula won reelection last year to lead Brazil — which with its GDP of $1.6 trillion is the region's largest economy — hoping this would put an end to the tumultuous years under far-right former President Jair Bolsonaro.

Lula is being hosted on his Iberian tour by two of the staunchest supporters of the EU-Mercosur agreement. On the Portugal leg of the visit, he signed a dozen business deals. He was due to attend a business forum in Madrid on Tuesday before meeting Spanish Prime Minister Pedro Sánchez on Wednesday.

Won't let you go

“Now that Brazil is back, we won't let Brazil go,” said Portuguese Prime Minister António Costa after meeting with Lula. “Brazil can also always count on Portugal as a spearhead in the work we must continue to complete the EU-Mercosur agreement.”

Madrid, for its part, aims to strengthen the EU’s economic ties with Latin America during its turn at the helm of the Council starting in July.

“Lula will find [it] hard to explain his position in EU capitals, but the finalization of the EU-Mercosur association agreement will continue — and other issues, like agriculture or the environment, rather than Ukraine, will become the real stumbling blocks,” said Oscar Guinea from Brussels-based think tank ECIPE.

Support in the EU for Mercosur is not, however, unanimous: France and Austria are among the countries that expressed skepticism on the proposed trade deal at a summit of EU leaders last month. Their longstanding pushback is motivated by concerns over deforestation in the Amazon as well as fears of a surge in agricultural imports.

Securing an accord with the Mercosur countries — Argentina, Brazil, Paraguay and Uruguay — thereby winning a market of over 260 million people would be a welcome boost for Brussels, which is ramping up so-called values-based trade with like-minded partners around the world to cut the EU's trade dependency on countries like Russia and China.

Intensified talks between EU and Mercosur negotiators are scheduled in the coming months in the hopes of touting significant progress on the deal at the July summit.

But trip-ups could still jeopardize the deal. Chief negotiators were supposed to meet in person in Buenos Aires last week, but the visit was canceled at the last minute. The Mercosur side still needs to formulate its counterproposal to the EU’s sustainability side-letter, which is a key condition laid down by EU trade chief Valdis Dombrovskis for closing the deal.

Balancing act

The EU is keen to point out that it's not the only entity with its eyes set on Latin American markets.

“If we don't negotiate that agreement ourselves, the Chinese and other powers will come in and do it,” said a senior EU official who was not authorized to speak publicly on the topic.

China is now Brazil’s No. 1 trading partner; it was a sign of the new geopolitical pecking order that Lula decided to visit Beijing earlier this month rather than host von der Leyen in Brasília.

While in Beijing, Lula made clear that he doesn’t see the world as Washington does. 

“Every night I ask myself why all countries have to base their trade on the dollar,” Lula said, adding that Brazilian-Chinese ties would be crucial to building “new geopolitics.”

In Portugal over the weekend, the Brazilian leader stressed the so-called neutral stance of his country on the war, and said that he didn’t want to “please anyone”; just “build a path for peace in Ukraine.”

Lula’s statements “are perceived in different ways in Europe and in Latin America and in Brazil,” pointed out Lucia Ortiz from the nongovernmental organization Friends of the Earth Brazil. She added that Lula’s comments stress his willingness to engage Brazil in “a diversity of relationships in terms of trade, cooperation with different states, more multilateralism.”

Meanwhile, the clock is ticking ahead of the July summit.

The agreement “will give us a stronghold, not just from a trade point of view [but] from a geostrategic point of view, into that region,” the senior EU official said. “If we don't manage to conclude this agreement — well, others are waiting. And the Chinese are already formally or informally voicing their interest to conclude [an] agreement.”

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Image: Belgium's Prime Minister Alexander De Croo speaks during a plenary session of the Chamber at the Federal Parliament in Brussels on April 20, 2023. NICOLAS MAETERLINCK / AFP

Belgium's De Croo: 'It's time for Europe to move away from a purely national approach on energy'

Belgian Prime Minister Alexander De Croo, who is hosting a summit of North Sea countries in Ostend on Monday, promotes coordinated development of renewables

LE MONDE By Jean-Pierre Stroobants(Brussels, Europe bureau) ,  Published on April 24, 2023

Flemish liberal Alexander De Croo, 47, has been leading a seven-party Belgian coalition government since 2020. On Monday, April 24, he is to host a summit of North Sea countries in Ostend with representatives of France, Germany, the United Kingdom, Ireland, Denmark, Netherlands, Norway and Luxembourg. The European Commission will also take part.

What is the objective of this meeting?

The primary goal is to move from announcements to action, and from innovation to industrialization, in the field of renewable energy. This field is now of geostrategic importance. The nine countries concerned must agree on the objectives to be achieved, the standardization and the interconnection processes. It is time for Europe to use all the advantages of its size and to move away from a purely national logic in the field of energy.

Did the war in Ukraine accelerate this project?

The conflict has obviously turned energy policy into a major geopolitical issue. And, furthermore, securing energy infrastructure has become a key issue. The crisis we have experienced was caused by our dependence on fossil fuels produced by a country with which we have a fundamental disagreement. Exploiting Europe's technological leadership is the only way to protect ourselves against exorbitant price increases: Renewable energy is one of our best weapons for this. In my country, which has a small maritime area and only 67 kilometers of coastline, it covered almost a quarter of consumption in February.

The North Sea energy infrastructure has apparently already been the target of Russian espionage...

Yes, and Belgium is, more generally, a central location for political and military decision-making. We are aware of this special role. In particular, we plan to double the number of our intelligence services during this legislature in order to safeguard all our institutions and those based here. The recent exposure of the scandal of alleged corruption in the European Parliament by foreign states is a case in point. Like other countries, we have already expelled Russian diplomats.

Ukraine is demanding more resources and the translation of European commitments into action, particularly with regard to weaponry. Is the European Union procrastinating so as not to show its differences?

The unity that we have displayed displeases Russia, which did everything it could, long before the war, to try to break it. And it cannot be denied that our Ukrainian partner has a tendency to push us to go further, which means that we sometimes take the time to think about aligning our positions. There may of course be differences between us, but we can be proud of the action we are taking and will take in the long term. It is understandable that President Volodymyr Zelensky is calling for more weapons faster. But we must constantly find a balance between his demands and our own security and strategic imperatives. This is not easy.

Do you believe in the possibility of a negotiated solution to this conflict?

My hope is that this war will end as soon as possible and any ending includes the element of negotiation. But it is understandable that Ukraine does not consider negotiation when it has lost a large part of its territory. Let us not forget, on the other hand, what history teaches us: wars sometimes end because of unforeseeable events.

The conflict has upset the balance between Europe, the United States and China. How does your country position itself?

My priority is the affirmation of a common, clear European position, without constant reference to others. The European Union is a world leader in all areas except the military. This is an area in which it is being remobilized, however, and this should lead to a rebalancing within NATO. The transatlantic relationship remains essential in my view, and we share fundamental values with the US, not with China.

The balance between China and Taiwan is delicate. I think it must be respected and if it is disturbed, the Europeans should react.

One of the problems facing Europe and Belgium – especially in Flanders, where the far right is on the rise – is getting people to stick to a political project. Do you have any remedies for this?

The financial crisis, the pandemic, the energy crisis and the climate-related crises have led to the collapse of our certainties, the migration issue has fueled extremist discourses, and our societies are complex. But do we believe that authoritarian regimes offer better results than democratic states in terms of mutual respect, prosperity and solutions? Democratic countries do not wage war. As for the disaffection of public opinion, for me, it is a motivating factor. The coalition that I lead will show in the coming year, before the elections, what it is capable of. We have 400 days left to provide answers and concrete solutions.

With a surge of the extreme right in Flanders, and of the extreme left in Wallonia, will your country play out a new and prolonged crisis in 2024 once again?

This country cannot afford to engage in another round of institutional debate while the world moves on. Our priorities are to get our public finances in order, increase employment and maintain an innovative industry. Anything else would be a waste of time.

But in Flanders, nationalist parties are claiming that Belgium will not escape its problems without a new major negotiation between its communities...

It is a simplistic discourse that leads them to hide behind a supposed impossibility not to act. They talk about the risk of blockage, whereas their goal is precisely to organize this blockage.

I know France well and I have a good perception of the French protest fiber, which sometimes leads the population to oppose things that, from a foreign point of view, do not seem staggering. And then they find solutions.

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Image: / US President Joe Biden boards Air Force One at the Delaware Air National Guard Base in New Castle, Delaware, on January 15, 2023, en route to Atlanta, Georgia. BRENDAN SMIALOWSKI / AFP/ Editing by Germán & Co

Who are the candidates for the 2024 US presidential election?

There are already seven candidates vying for the Democratic and Republican nominations, including frontrunners Joe Biden and Donald Trump.

Le Monde with AFP, Published yesterday at 11:27 pm (Paris)

With the two candidates from the United States' previous election now campaigning for the next one, the 2024 US presidential election could be a rematch of 2020. Former Republican President Donald Trump has been in the running since the fall, while current Democratic President Joe Biden announced on Tuesday, April 25 that he would run for reelection.

With just over a year and a half to go before the election set for November 5, 2024, the number of primary candidates for the two major US parties keeps getting bigger. In any case, the Biden and Trump candidacies appear, for the time being, to be the strongest. For the Democrats, there doesn't appear to be a credible alternative to Biden while on the Republican side, Trump, although somewhat weakened, is still the man to beat.

Below, Le Monde gives an overview of the profiles of the seven declared candidates, and of two others who could potentially change the odds on the Republican side, more than five hundred days before the election.

Among Republicans

Donald Trump, the outrageous ex-president with a myriad of legal problems

Aged 76, the 45th president of the United States (2016-2020) officially declared his candidacy on November 15, 2022. Surrounded by investigations into his financial affairs, his pressuring of election officials in Georgia during the 2020 election and even his management of White House archives, he is throwing himself headlong into his new election campaign, regularly decrying "a witch hunt" against him. He recently became the first former president to face criminal indictment.

While still very popular with many parts of the American public, his new campaign effort could be stymied within the Grand Old Party itself, where dissenting voices have been growing since 2020.

His age – he will be 82 at the end of his term if elected in 2024 – is also seen as problematic, along with his repeated outbursts that, over time, have grown tiresome to some conservative voters. In the absence of a strong opponent, he remains the top-polling Republican for the moment.

Nikki Haley, a former Trump loyalist who advocates change

The former governor of South Carolina (2011-2017) and former US ambassador to the United Nations (2017-2018) was the first Republican to officially enter the race for the presidential nomination against Trump on February 14 at a rally in Charleston, South Carolina.

At 51, the self-assured conservative was a loyal ally of the US president, whom she served as chief of staff for two years. However, she has decided to take a step back and present herself as an alternative to Trump.

In her announcement speech, she called, among other things, for generational change. She is also banking on potential interest from minority voters, as her party is dominated by white male figures. She offers a certain sophistication in terms of appearance and speaking that sets her apart from the more virulent Trump supporters in Congress.

Ron DeSantis, the main challenger, not yet announced

Many skeptical Republicans are pinning their hopes on the possible candidacy of Florida Governor Ron DeSantis, who, at only 44 years old, is seen as the rising star of the hard right. He could be the most serious challenger to Trump in the Republican camp but has not yet announced his candidacy.

In 2018, the former naval officer was narrowly elected to lead the southern US state after receiving an endorsement from Trump, whose ideas he shares – although at times he is critical of his excesses. Since then, he has distanced himself and gained in popularity by repeatedly making ultra-conservative strides on education and immigration.

"I've only begun to fight," he said in early November, after his comfortable re-election to the top job in his state, which fueled speculation. However, a formal announcement of candidacy is not expected before the summer.

Mike Pence, Trump's former right-hand man, expected to announce

After years of unwavering loyalty to President Trump, his former vice president, Mike Pence, changed his tune after the assault on Capitol Hill on January 6, 2021, when the former president publicly pressured him to not certify the results of the 2020 presidential election.

The 63-year-old evangelical Christian, a fervent opponent of abortion, now seems determined to enter the race for the White House. He is traveling across the country, regularly speaking in states that could make a difference in the Republican primary.

While he has not yet formally announced his candidacy, he said he would make his final decision within "weeks, not months," with an announcement expected "well before the end of June," according to an interview with CBS on April 22.

The 'minor' candidates: Vivek Ramaswamy and Asa Hutchinson

Vivek Ramaswamy, a 37-year-old multimillionaire entrepreneur and author, has become known for his "anti-woke" positions and his strong conservative stance. In particular, he denounced what he calls a "national identity crisis" in the United States. He announced his candidacy on February 21 on the set of FoxNews, the show of the conservative channel's recently departed star anchor, Tucker Carlson.

Former Arkansas governor (2015-2023) Asa Hutchinson, 73, who has been a candidate since April 2, is one of the few Republican elected officials who have dared to openly criticize Trump, particularly during the 2020 election. The conservative former governor has a strong anti-abortion stance and signed a law banning abortion, even in cases of rape or incest, in his state in 2021.

Among Democrats

President Joe Biden, candidate for a second term at 80

After months without any real suspense, Biden officially announced that he is running for a second term on Tuesday, April 25, in a video published across his social media accounts. The current American president, already the oldest who has ever held office, would complete his second term at the age of 86 if re-elected in 2024. A point that raises concerns and is especially used as a political argument by his Republican opponents, who seize on every opportunity to criticize his sometimes slurred speech, public gaffes or moments of confusion.

Nevertheless, Biden has tried to be reassuring, presenting himself, since his inauguration, as dynamic and resilient while not hesitating to prove his "good health" through medical check-ups.

In this new campaign, Biden is betting above all on continuity, repeating his desire to restore the "dignity" of the "forgotten" working class America, part of which Trump has been able to seduce. He is counting in particular on his favorable economic record, as well as on his initiatives in the areas of employment, health care and education to achieve re-election. He is also the defender of individual rights and freedoms for all, including women and minorities, and presents himself as a bulwark for American democracy.

While Democrats have been waiting for him to officially declare his candidacy, no serious candidate has emerged to challenge the incumbent's leadership internally.

The 'minor' candidates: Robert Kennedy Jr. and Marianne Williamson

Robert Kennedy Jr., the son of former Attorney General Robert Kennedy and nephew of President John Fitzgerald Kennedy, declared his candidacy for the Democratic nomination at a rally in Boston, Massachusetts, on Wednesday, April 19. The 69-year-old environmental lawyer is a controversial figure, and for good reason: since 2005, he has been known as an activist and spokesperson for vaccine conspiracy theories, linking autism to one of their components.

Marianne Williamson, 70, re-entered the race for the 2024 Democratic Party nomination on March 4 after briefly running in the previous presidential election. A best-selling author of books on spirituality and personal development, she is best known for being Oprah Winfrey's spiritual advisor and is regularly noted for her lyrical rants about the power of "love." During her few months of campaigning in 2019-2020, she had advocated for the creation of a State Department of Peace, promoted questionable healthcare practices and denounced Trump's success as a "symptom" of America's malaise, among other things.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image: A South Korean news program displaying a North Korean missile test.Credit...Lee Jin-Man/Associated Press

Inside Biden’s Renewed Promise to Protect South Korea From Nuclear Weapons

President Biden’s emphasis on America’s willingness to defend South Korea is a striking admission that North Korea’s arsenal is here to stay

NYT By David E. Sanger and Choe Sang-Hun, April 26, 2023

*David Sanger has covered the North Korean nuclear program since the late 1980s. Choe Sang-Hun covers South Korean politics and security

WASHINGTON — In the four years since President Donald J. Trump’s leader-to-leader diplomacy with Kim Jong-un of North Korea collapsed after a failed meeting in Hanoi, the North’s arsenal of nuclear weapons has expanded so fast that American and South Korean officials admit they have stopped trying to keep a precise count.

North Korea’s missile tests are so frequent that they prompt more shrugs than big headlines in Seoul.

So when President Biden welcomes President Yoon Suk Yeol of South Korea to the White House on Wednesday, only the second state visit of Mr. Biden’s presidency, there will be few pretenses that disarming North Korea remains a plausible goal.

Instead, American officials say, Mr. Biden’s most vivid commitment to Mr. Yoon will focus on what arms control experts call “extended deterrence,” renewing a vow that America’s nuclear arsenal will be used, if necessary, to dissuade or respond to a North Korean nuclear attack on the South.

The emphasis on deterrence is a striking admission that all other efforts over the past three decades to rein in the Pyongyang’s nuclear program, including diplomatic persuasion, crushing sanctions and episodic promises of development aid, have all failed. It is also intended to tamp down a growing call in South Korea for its own independent arsenal, on the very remote chance that North Korea would make the suicidal decision to use a nuclear weapon.

The North’s arsenal will hardly be the only topic under discussion during Mr. Yoon’s visit. He and Mr. Biden will also celebrate the 70th anniversary of the alliance between their countries, commitments for more South Korean investment in manufacturing semiconductors and plans to bolster Seoul’s always-fraught relationship with Japan.

But the rapid expansion of North Korea’s capabilities is a subject of perpetual mutual concern for both countries. At a recent security conference held by the Harvard Korea Project, several experts said they believed Mr. Kim’s goal was to approach the size of Britain’s and France’s arsenals, which hold 200 to 300 weapons each.

Mr. Biden and Mr. Yoon are expected to hold out the possibility of pursuing a diplomatic solution toward what a succession of administrations have called the “complete, verifiable, irreversible denuclearization of the Korean Peninsula.” But the North, administration officials say, has declined to respond to a series of public and private messages from Mr. Biden and his aides.

And what seems irreversible now is North Korea’s entrenched and advanced program.

With China expanding its arsenal to 1,500 weapons by around 2035, according to Pentagon estimates, and Russia threatening to use tactical weapons in Ukraine, “this is not an external environment in which it’s easy to have a conversation with North Korea,” said Victor Cha, a professor at Georgetown University who directed policy toward the North during the George W. Bush administration. “They look around their neighborhood and they say, ‘I don’t think so.’”

Mr. Trump vowed “fire and fury like the world has never seen” when North Korea greeted his presidency with missile launches; he ultimately tried the innovative approach of direct diplomacy with Mr. Kim. He emerged at one point predicting that Mr. Kim would begin disarming within six months and declaring at another that the North was “no longer a nuclear threat.” The arsenal just kept growing.

On Friday, North Korea’s foreign minister, Choe Son-hui, repeating a line that has been uttered by her government frequently in recent months, said the North’s status “as a world-class nuclear power is final and irreversible.”

Few experts believe the shift in rhetoric or the threats about first strikes indicate a greater willingness by the North to employ nuclear weapons. The response would be devastating. But gone are the days when American officials thought that the arsenal was a bargaining chip, something to be bartered away for trade deals, or for the string of hotels that Mr. Trump said America would help build on the North Korean beaches.

There was a mistaken belief, said Joseph S. Nye, who oversaw one of the first intelligence estimates of North Korea for the U.S. government, “that they would try to cash in their chips and get something” for the nuclear weapons. But rather than developing the country, he said at the Harvard conference, the North’s highest goal was “to preserve the dynasty,” and that meant holding on to the arsenal, and expanding it.

North Korea’s new confidence in expanding the arsenal, American officials said in interviews, is partly explained by a change in the relationship with China. Previously, the United States worked with Beijing — the supplier of critical energy and trade to the North — to rein in the country. In the mid-2000s, the Chinese even hosted the so-called six-party talks — North Korea, along with Japan, Russia, the United States and South Korea — to resolve the nuclear issue. When Pyongyang conducted nuclear tests, Beijing often voted for sanctions, and imposed a few.

Now, rather than view North Korea as an unruly, angry neighbor, China has welcomed it, along with Russia and Iran, as part of what White House officials call a coalition of the aggrieved. While Chinese officials presumably fear North Korea’s nuclear tests could go awry, creating a radioactive cloud, it appears perfectly happy to have the North unsettling the United States and its allies with regular missile tests.

Pyongyang’s most recent tests of intercontinental ballistic missiles — including one powered by solid fuel, which makes it quick to roll out of hiding and launch — suggest that North Korea can now almost certainly reach American territory, even if its ability to hit specific targets is imprecise. And over the past year, the North has enshrined its nuclear capability in its laws and started talking about its first-strike capabilities, rather than casting its arsenal as purely defensive.

On March 27, North Korea also released photos of Mr. Kim inspecting Hwasan-31, a small standardized nuclear warhead kit that can be mounted on its various nuclear-capable missiles and drones.

If the module was a real thing, the photos mean that the North is showing off an ability to mass-produce standardized nuclear warheads, said Hong Min, an expert on North Korean weapons at the Korea Institute for National Unification in Seoul. Mr. Kim has also called for mass-producing nuclear warheads for an “exponential” increase in the country’s nuclear arsenal. Last month, he ordered his government to step up the production of weapons-grade nuclear materials.

South Korean officials said that some of the North’s claims, like the purported capabilities of its underwater drones and supersonic missiles, were exaggerated. The reaction in Washington and Seoul has been to vow to strengthen their alliance — made easier by the fact that Mr. Yoon takes a far more hawkish view of how to deal with the North than did his predecessor, Moon Jae-in, who visited Mr. Biden in May 2021.

So the two leaders are expected to speak at length, publicly, about “extended deterrence,” with Mr. Biden offering more regular, visible visits of nuclear-armed submarines and aircraft to South Korea, bolstering the recently reinstated and expanded joint military exercises. (The exercises were variously suspended and scaled down under Mr. Trump.)

Kim Tae-hyo, a deputy national security adviser for Mr. Yoon, said that a top agenda item at the summit was how to boost South Korean confidence in Washington’s commitment to protect its ally with its nuclear umbrella. But Korean officials say that is more dependent on their confidence in the sitting American president — and whether, in the midst of a North Korean attack on the South that employed tactical nuclear weapons, Washington would be willing to take the risk to enter nuclear combat.

Mr. Biden’s words at a news conference on Wednesday will be picked apart for what they may, or may not, say about his determination to take the risks of nuclear engagement.

A new cyberinitiative will also be announced: The North funds the nuclear program with thefts of cryptocurrency and attacks on central bank reserves, and the South, though it rarely discusses it, has developed a skilled offensive cybercorps loosely based on the U.S. Cyber Command.

Outsiders will also be looking for signs of temporary or permanent damage from the leaks of Pentagon and C.I.A. documents in recent weeks that made clear the United States was listening in on top South Korean national security officials as they debated whether to send artillery rounds to Ukraine. The revelation was highly embarrassing for Mr. Yoon, because it suggested an absence of trust by his biggest ally.

But officials say they believe Mr. Yoon will move past it, celebrating cultural ties with the United States and booming investment by South Korean companies in semiconductor plants.

There is one thing South Korean officials say they will not ask for: a return of American tactical nuclear weapons to their country. They were withdrawn in 1991.

Mr. Yoon’s aides say they do not want them back.

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Image: Finance Minister Bruno Le Maire arrives at the International Monetary Fund (IMF) headquarters in Washington, DC, on April 12, 2023. STEFANI REYNOLDS / AFP/ Editing by Germán & Co

France to continue subsidizing electricity bills until 2025

French Finance Minister Bruno Le Maire announced the extension as the country's electricity providers continue to suffer the effects of Russia's war in Ukraine.

Le Monde with AFP, TODAY

The French government will continue subsidizing electricity bills into 2025 as prices suffer from Russia's invasion of Ukraine and part of the country's nuclear reactor fleet remaining offline, the finance minister said on Friday, April 21. With bills still "very high" compared to late 2021, "I'm giving us two years to end" electricity subsidies by early 2025, Bruno Le Maire told broadcaster LCI – a day after vowing to slash France's debt and deficits with cuts to public spending.

State-owned energy firm EDF produced its lowest amount of electricity in 30 years last year, as many nuclear reactors – the heart of France's energy system – have been taken offline due to corrosion discovered in emergency cooling systems. Energy prices have also been mounting across Europe from the throttling of the flow of Russian gas since Moscow attacked Ukraine last year.

Increases in electricity bills have been less sharp in France thanks to government subsidies, at 4% in 2022 and 15% this year – at a projected cost of €45 billion in 2023. But Le Maire said there was "no longer a need to keep up" subsidies for gas, as prices have fallen back, vowing to end them this year.

The finance minister had on Thursday said it was time to cut public spending to rein in annual budget deficits and France's overall debt, one of the highest burdens in the 27-member European Union.

Both figures had swollen from Paris' "whatever it takes" response to the coronavirus crisis and the energy price surge. "It's vital to speed up debt reduction" between now and the end of President Emmanuel Macron's second term in 2027, Le Maire insisted in an interview with regional daily Courrier Picard.

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News round-up, April, 25, 2023

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Most read…

The Climate Solutions We Can’t Live Without

The climate crisis is full of interconnected problems—but some are more connected than others. A former energy secretary, New Mexico Governor Bill Richardson, lamented at the time, "We are a major superpower with a third-world electrical grid."

NEW YORKER By Daniel A. Gross, April 24, 2023

Geopolitical tensions are a new obstacle to restructuring the debt of poor countries

China has become the largest creditor for low-income countries. Finding agreements to reduce the debts of nations in severe difficulty requires a consensus among creditors – but they all have different strategies.

Le Monde by Julien Bouissou Published yesterday at 7:06 pm (Paris)

Floating wind power gains traction but can it set sail?

In 2023 will determine just how successful this is if the next decade is to see the acceptance of floating offshore wind and its rise into a leading market.

REUTERS By Nina Chestney and Susanna Twidale

Argentina's lithium pipeline promises 'white gold' boom as Chile tightens control

According to Benjamin Gedan, head of the Latin America program at The Wilson Center, "Argentina's lithium sector has grown through a decentralized, pro-market strategy." In contrast, Bolivia's lithium sector "repeatedly stopped as a result of heavy governmental control."

Reuters By Lucila Sigal, Today

Putin ally: We are probably on verge of a new world war

MOSCOW, April 25 (Reuters) - An ally of Russian President Vladimir Putin said on Tuesday that the world was probably on the verge of a new world war and the risks of a nuclear confrontation were rising.

Reuters

American takeover of French nuclear firm raises concerns in Paris

French government looks to prevent France-based Segault from falling under US ownership via a takeover deal.

POLITICO. EU BY GIORGIO LEALI, APRIL 21, 2023

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Image: Germán & Co by Shutterstock

The Climate Solutions We Can’t Live Without

The climate crisis is full of interconnected problems—but some are more connected than others. A former energy secretary, New Mexico Governor Bill Richardson, lamented at the time, "We are a major superpower with a third-world electrical grid."

NEW YORKER By Daniel A. Gross, April 24, 2023

The biggest blackout in U.S. history began on a warm Thursday afternoon in August, 2003. In the span of seven minutes, it spread to at least eight states and the Canadian province of Ontario, an area in which some fifty million people lived. In New York City, elevators froze between floors. One woman in midtown walked down eighteen flights of stairs, collapsed, and could not be resuscitated. Transit workers hustled thousands of panicked passengers out of dark subway tunnels. That evening, the city’s skyline was dark; in satellite photographs, a shadow appeared to have fallen across swaths of the Northeast.

Immediately, people theorized about the origins of the breakdown. Canadian officials blamed power plants in New York State; New York officials argued that the blackout had begun somewhere west of the Ontario power system. But neither of these hypotheses could fully explain why thousands of miles of electrical wires had suddenly gone dark. “We are a major superpower with a third-world electrical grid,” Governor Bill Richardson of New Mexico, a former energy secretary, complained at the time. Representatives for utility companies pointed specifically to overtaxed transmission lines, which carried power between different parts of North America. “If there had been more lines available at the time that this event occurred, it’s possible they could have absorbed the load and kept the failure from spreading,” one observed.

“We’ve got excess power in upstate New York, but there’s no way to get it to New York City because of the bottlenecks,” another said.

A joint U.S.-Canada report ultimately concluded that the outage had likely originated with some overgrown trees in northern Ohio. On warm days, the metal in wires tends to heat up and expand, and, that afternoon, a warm line sagged into a tree branch. This tripped the line and caused a short circuit to ground; the local utility company wasn’t alerted because its alarm system was broken. So many other power lines were close enough to capacity that the rerouted electricity overloaded and tripped them, and, by 4:06 p.m., power could no longer flow to the south of the state. Instead, it went northwest, to Michigan, where it overloaded more lines; to the east, a cascade of failures extended all the way to Massachusetts and New York. By 4:13 p.m., hundreds of power plants were shutting down. The blackout inflicted billions of dollars in economic damage, and a study later found that it contributed to about a hundred excess deaths.

In any complex system, there are points of special weakness. Problems in those places cause many more problems. Those weaknesses, however, can also present opportunities: strengthen the right spots, and everything gets easier. More than a year before the blackout, a Department of Energy report addressed to President George W. Bush had identified fifty places in the eastern U.S. where a power surge could overwhelm overtaxed lines. “These bottlenecks,” the authors wrote, “increase the risk of blackouts.” The upside was that power companies and government agencies could focus their efforts on the weakest links. But the report also described the obstacles to this rational course. A decade earlier, utilities had proposed adding a power line between West Virginia and Virginia—a connection that could make a “cascading outage” across the eastern U.S. less likely. At the time, the project was still waiting for final approval from state regulators and the U.S. Forest Service. (It was approved several months later, and then it took an additional three years to construct.)

The 2003 Northeast Blackout has something to teach us about the challenge of climate change. Right now, the planet is getting warmer, and unprecedented heat waves, floods, and fires are claiming lives and livelihoods. There’s hardly any time left to pivot away from fossil fuels and toward clean power sources like wind and solar. And, in this effort, there are weak points—problems that are causing many more problems.

One such area is the grid itself. There still aren’t enough lines connecting windy, sunny places to locales that need the most electricity; meanwhile, the grid is so delicately balanced that many clean-energy projects now wait about four years, in an “interconnection queue,” simply to be plugged in. The grid has become a bottleneck in the fight to protect the climate. Other bottlenecks can be found in our daily lives and our global economy. We will need to swap out our dirty stoves and heaters for cleaner ones—but we can’t make these kinds of upgrades without training more electricians and plumbers. We will need to drive more electric cars—but we can’t power them until we can responsibly mine and recycle enough lithium for the batteries. We need to get our methane emissions under control—but it’s difficult to plug the leaks without new tools to show us where the gas is coming from. There’s a general principle at work here: if we’re quick to find and fix the bottlenecks, progress is possible. If we can’t fix them, we face a breakdown.

Afew years ago, a report funded by the U.S. Department of Transportation investigated the prototypical bottleneck: the traffic jam. Historically, Americans have blamed traffic on a lack of capacity—“not enough lanes” or “too many cars.” As a result, the authors argued, we have often tried to “build our way out” by widening entire highways at enormous expense. But bad traffic often starts with a local logjam—for example, at a single place where three lanes narrow into two—and then cascades across the system. This means that the government doesn’t need to spend hundreds of millions of dollars on major highway projects. Instead, it can spend, perhaps, a million dollars to widen a bottleneck with an additional lane. Better yet, it can do what the Texas Department of Transportation did to a bottleneck on U.S. Route 183, in North Austin: spend fifty-five thousand dollars to restripe the road, so that two lanes become three. “If it was this easy and this cheap, what took you so long?” one local asked, when the traffic dissipated.

Bottlenecks, according to the report, are often the places where targeted efforts can make the most difference. Turn this lens onto the energy system and new insights may come into view. In many parts of the U.S., it’s clear from the line to join the grid that there’s an abundance of wind and solar and battery projects. For that reason, a million dollars might be better spent on electrical-system upgrades than on new subsidies to incentivize clean-energy projects. A subsidy primarily benefits the project that receives it, but even a small improvement in the interconnection queue could benefit all the projects that are waiting in line. Likewise, if you’re in the mood to badger your lawmakers about something, consider badgering them about whichever government agencies are standing in the way of new transmission lines. On a national level, the Biden Administration could staff up federal agencies that review permits, such as the Bureau of Indian Affairs and the U.S. Forest Service; the Federal Energy Regulatory Commission, which already approves regional natural-gas pipelines, could be empowered to approve regional transmission lines. It’s also possible to find routes around the bottlenecks: it’s sometimes argued that clean-energy projects shouldn’t pool their electricity on a rickety grid in the first place, and should instead power local microgrids, such as university campuses or apartment complexes.

The theory of bottlenecks could amount to a hopeful strategy for supercharging the fight against climate change. The basic principle is to look for the sources of gridlock in the system, and to focus on restoring flow before worrying about individual cars. A functional citywide composting system is worth far more than a few isolated piles of food scraps; similarly, a new car-charging station, in a neighborhood where it’s hard to find one, could cut emissions more than any one person’s pledge to drive less. These structural changes will not come easily, but they can help us focus our efforts. A city or state that wants to spur rooftop solar should look for where the longest lines are forming: if solar panels are piling up in warehouses because customers can’t afford them, subsidies might help; if those who’ve bought panels are waiting months for an someone to hook them up, the government could consider launching a free certification program for solar installers, or a clean-energy vocational scholarship through a local trade school. And, if the longest lines are for permits at city hall, then maybe it’s time to hire more office workers. “An hour lost at a bottleneck is an hour lost for the entire system,” Eliyahu M. Goldratt, a business consultant and process theorist who authored several novels about management—among them “It’s Not Luck,” “Necessary but Not Sufficient,” and “Isn’t It Obvious?”—once wrote.

Over time, if clean-energy investments are successful, the bottlenecks will move. After America has trained a million new tradespeople, we might find ourselves waiting on solar companies to build new factories. When the interconnection queue shrinks to one year, it might be time to badger your legislators about wind and solar projects, not wires. The same logic can also be applied to fossil-fuel infrastructure, but in the opposite direction. One argument for protesting against oil and gas pipelines is that they’re bottlenecks. This is also why climate activists were so disappointed when the Biden Administration approved ConocoPhillips’s sprawling Willow oil project, in Alaska: red tape might have been enough to keep that oil in the ground.

Other breakthroughs have the potential to cascade across large sectors of the economy. If shipping companies succeed in decarbonizing cargo ships, some of the dirtiest vehicles on earth will get a little less dirty, and the carbon footprint of virtually every consumer will go down. A small advance in cooling technology, like a cheaper heat pump or a superefficient air-conditioner, will be multiplied by the billions of people who will need one as the planet warms. And, given that many machines, from heat pumps to cars, will be in service for decades to come, a dollar spent on research and development is probably worth a lot more today than years from now. Of course, pessimistic scenarios flow from these same principles, too: even a step in the right direction may be meaningless if a bottleneck later stops you in your tracks. “An hour saved at a non-bottleneck is a mirage,” Goldratt warns.

Not so long ago, coverage of the climate focussed on the small signs that big changes were coming. The trees were blooming a few weeks early; the butterflies had moved north; the sand on the beach was washing away. These stories were necessary but not sufficient. Nowadays, we are more likely to report that the trees are burning and the butterflies are dead. When the crisis is in the present tense, as it is now, and the window for halting it is slamming shut, all we can aim for is action. If this decade is our last best chance to avert the worst consequences of climate change, how should we spend it?

In this week’s digital issue, inventive and passionate people try to solve a hard problem—maybe the hardest problem—in surprising ways. They look for bottlenecks and try to alleviate them. Because the fight against climate pollution is hamstrung by the difficulty of detecting emissions, they set out to launch a satellite that can essentially catch polluters red-handed. Because enormous solar farms often can’t be constructed without the buy-in of local people, they imagine new models that can win community support. Because the melting of certain ice sheets will have outsized consequences, they try to figure out if it’s possible to save some. These stories don’t aim to bear witness or raise awareness. They start from the premise that the planet does not care whether we care—only whether we act, and act quickly, in useful places.

The interventions considered in these stories reveal something about the architecture of our global problem. Here’s how the pipes and walls and wires fit together; here are the doorways you can walk through; here are the places that can catch fire, and the extinguishers that can put those fires out—and the exits, when all else fails. If a building’s weakest link is its single exit, it’s unwise to begin by widening the upstairs hallway. We can build a second exit. We can look for better ways to wire, and for materials that will not burn, and for walls that could become doorways. We can find the fixes that make other fixes possible. 

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Germán & Co by Shuttersstock

Geopolitical tensions are a new obstacle to restructuring the debt of poor countries

China has become the largest creditor for low-income countries. Finding agreements to reduce the debts of nations in severe difficulty requires a consensus among creditors – but they all have different strategies.

Le Monde by Julien Bouissou Published yesterday at 7:06 pm (Paris)

The debt that most threatens rich countries is not so much theirs as that of poor countries. At least 54 countries are over-indebted or nearly over-indebted. If nothing is done to lighten their burden, the situation could deteriorate and resemble that of the 1980s and 1990s. The consequences are well known: rampant inflation, riots, political instability and stunted development. The widening gap between rich and poor could add to geopolitical tensions in an already unstable world.

Debt is not just an abstract, painless string of numbers. It is because of debt that subsidies on food purchases in Pakistan have been removed, that the Laos health budget has been cut, and that 56,000 Sri Lankan children suffer from severe malnutrition. The United Nations Development Programme has calculated that the 25 most indebted countries now allocate 20% of their tax revenues to debt repayment.

The new context of geopolitical fragmentation complicates debt restructuring. The profile of creditors has changed in recent decades. The members of the Paris Club (22 countries, including the United States, France and the United Kingdom) held 39% of the debts of low-income countries in 1996, whereas they hold only 11% of the total today. New countries have emerged, primarily China, which has become the largest creditor for half of the low-income nations. According to the AidData lab at the US University of William & Mary, it has lent $843 billion (€770 billion) in the past 20 years. This reconfiguration "adds to debt restructuring difficulties," reads an International Monetary Fund (IMF) study published in April, as "non-Paris Club creditors have often provided debt treatment to debtor nations on a case-by-case basis."

Fragmentation

China's debt is no longer just a problem for poor countries but for the whole world. For restructuring to take place, all creditors must agree. This is where the difficulties begin. As Kristalina Georgieva, the head of the IMF, explained in early April, geopolitical fragmentation "will make it harder to resolve sovereign debt crises, especially if key official creditors are divided along geopolitical lines."

Western countries, especially the United States, accuse Beijing of slowing down negotiations. In February, at a meeting of G20 finance ministers in Bengaluru, India, US Treasury Secretary Janet Yellen called on China to participate more fully "in meaningful debt treatments for developing countries and emerging markets in distress." Among the points of disagreement, Beijing is said to require that international financial institutions, like the IMF and the World Bank, participate in restructuring efforts by waiving part of their debts and renouncing their status of "preferred creditor" which allows them to be repaid before others.

But Western countries are opposed to this, arguing that the World Bank could see its rating downgraded and no longer be able to lend to countries at low rates. Beijing adds that it is being asked to apply rules that were put in place without it 30 years ago, and points the finger at the responsibility of private creditors. This is not wrong: the latter hold 19% of the outstanding debt of poor countries, compared to 8% 25 years ago. It is no longer a few banks that only needed to be brought together to obtain an agreement on a restructuring plan, but much more numerous bondholders who are reluctant to make concessions.

Survival

The IMF adds that "new debt instruments used by low-income countries tend to be increasingly risky and difficult to restructure," especially when they are not reflected in public accounts or are backed by commodities or infrastructure. A common restructuring framework was put in place by the G20, in order for China and the Paris Club to find an agreement, but without success. As economist Brad Setser wrote in a blog post published by the US think tank Council on Foreign Relations, "no framework for coordination among official creditors can work if official creditors don't have enough in common to work together."

While creditors are negotiating, countries that are close to or already in default, such as Tunisia, Ghana and Egypt, are fighting for their survival. Zambia has been negotiating a deal on its debt for two and a half years now. Restructuring forces countries to cut spending and resort to emergency loans at high rates. "I don't think we'll have many defaults, because it's very expensive for governments," said Masood Ahmed, president of the US-based think tank Center for Global Development, in January.

A payment default risks downgrading the sovereign rating and increasing the cost of borrowing on the markets for governments. "The payment of unsustainable debt service will lead to development crises rather than debt crises," concluded Ahmed. In other words, a deep crisis that will result from cuts in social and infrastructure spending by governments. If they don't come to an agreement as soon as possible, China, the United States and Europe will bear a heavy responsibility for the delay in development in countries that are home to one-fifth of the world's inhabitants.

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Image: Hywind Tampen floating wind farm structures are being assembled at the Wergeland Base in Gulen, Norway, June 7, 2022.  Ole Jorgen Bratland – Equinor/Handout via REUTERS/ Editing by Germán & Co

Floating wind power gains traction but can it set sail?

In 2023 will determine just how successful this is if the next decade is to see the acceptance of floating offshore wind and its rise into a leading market.

REUTERS By Nina Chestney and Susanna Twidale

LONDON, April 24 (Reuters) - After a bumper year for floating offshore wind farm tenders, the nascent industry is poised for explosive growth in the coming decade as countries strive to cut their carbon emissions.

But it's unlikely to be all plain sailing.

Rising costs and supply chain bottlenecks have hit some projects and without investment in infrastructure to launch the vast turbines and tow them to sea, hopes of harnessing the full power of the ocean's winds to hit climate targets could be dashed, industry experts say.

"If the next decade is to see the adoption of floating offshore wind, and its growth into a leading market, the work that we do in 2023 will dictate just how successful this is," said Felipe Cornago, commercial director offshore wind at BayWa (BYWGnx.DE), which is developing a wind farm off Scotland.

About 80% of the world's offshore wind power potential lies in waters deeper than 60 metres, according to the Global Wind Energy Council (GWEC), meaning floating turbines will be vital for some countries with little space left on land and steep coastal shelves to decarbonise their power sectors.

Winds are stronger and more continuous further out to sea so floating turbines can generate more power than those fixed to the seabed near to shore - and they less visible from the coast, reducing the risk of resistance from local communities.

By the end of 2022, plans for about 48 gigawatts (GW) of floating wind capacity around the world were in place, nearly double the amount in the first quarter last year, according to Fitch Solutions, with European companies driving the expansion.

Since then, new tenders have been launched in Norway and more are planned this year - but so far there are only just over 120 megawatts (MW) in operation worldwide.

Consultancy DNV forecasts that about 300 GW will be installed by 2050, representing 15% of all offshore wind capacity, but wind turbine makers are already struggling to meet rising demand due to rising inflation and raw material costs.

BOTTLENECKS AND COSTS

The largest project to date, the 88 MW Hywind Tampen project being developed by oil and gas company Equinor (EQNR.OL) off Norway, was meant to be fully commissioned in 2022 but delays due to some steel parts not being of sufficient quality for four of the towers has pushed the start to later this year.

Last year, oil company Shell (SHEL.L) and state-owned Chinese energy company CGN dropped a plan for a floating wind project off France's Brittany coast, citing inflation and supply chain problems among other reasons.

GWEC said supply bottlenecks for turbines and components could continue or even be compounded by incentives in the United States for low-carbon energy deployment, as well as increased demand in China, Europe and emerging markets.

As most commercial-scale floating wind farms are only expected to be up and running from 2030, there could be time for such problems to be resolved, said Francesco Cacciabue, partner and CFO at renewable energy investor Glennmont Partners.

At the moment, technology costs for floating wind are far higher than for fixed turbines but companies hope to reduce those costs sharply as larger projects come on stream.

According to DNV, the average levelized cost of energy (LCOE) - which compares the total lifetime cost of building and running a power plant to its lifetime output - for floating wind was about 250 euros per megawatt hour (MWh) in 2020, compared with around 50 euros/MWh for fixed turbines.

But by 2035, the LCOE for floating wind is expected to fall to about 60 euros/MWh.

"For floating, the expectation is that it will sell power at a higher price than fixed-foundation offshore wind for several years while it industrialises and gets to a point where it can compete on a like-for-like basis," said Jonathan Cole, chief executive of Corio Generation, part of Macquarie's (MQG.AX) Green Investment Group.

OFFSHORE PLANS

Norway's Equinor kick-started the floating wind industry after two of its oil and gas engineers saw a marker buoy they thought could be a structure to hold a floating turbine.

The company installed a pilot floating turbine in 2009 and has seen costs fall by 70% from the demonstration project to its 30 MW Hywind Scotland project. It expects a further 40% cost reduction for Hywind Tampen.

"It's about having larger turbines which are more efficient offshore," said Steinar Berge, head of floating wind at Equinor.

"The journey going forward is more reliant upon putting full-scale projects into action because then you will see much more innovation and investments in the supply chain which will drive costs further down," he said.

Still, higher costs in the medium term haven't dulled investor appetite for tenders. For some countries, floating wind might be the best option due to their seabed conditions, such as Japan, South Korea and the west coast of the United States.

"These are huge areas with the energy demands to match their huge populations, and they have a mandate to decarbonise as quickly as possible," said Cacciabue at Glennmont Partners.

The United States wants to develop 15 GW of floating offshore wind capacity by 2035 and its Wind Shot research and development programme hopes to cut the cost to $45/MWh by 2035.

Japan wants to install up to 10 GW of offshore wind capacity by 2030, and up to 45 GW by 2040, including floating. It plans to set a specific target for floating wind this year. South Korea, meanwhile, is aiming for 9 GW of floating wind by 2030.

Several countries in Europe have also set targets such as Spain which is seeking up to 3 GW of floating capacity by 2030.

PORTS AND SHIPS

Floating offshore wind farms are made up of huge turbines installed on floating platforms anchored to the seabed with flexible anchors, chains or steel cables.

But at the moment, there are at least 50 designs under development, so narrowing down the concepts is important for standardisation and enabling mass production, experts say.

They believe that can be achieved, as many oil companies have significant expertise operating in deep waters such as Shell, Equinor, BP (BP.L) and Aker Solutions (AKSOA.OL) - and some are teaming up with renewable developers to bid in floating wind tenders.

For now, Equinor's Berge said one of the biggest challenges was having enough large ports to assemble the turbines and move them out to sea. Many of his peers agree.

According to a DNV survey of 244 experts, the biggest supply chain risk they identified was having enough suitable ports, followed by the availability of installation vessels.

Ports where towers measuring more than 150 m to the centre of the rotor and their giant floating bases can be manufactured and assembled are ideal - and they will also need enough access channels, berths, land areas and storage space for handling large, heavy structures, experts say.

But in many countries, such ports are sorely lacking.

Britain aims to have 5 GW of floating wind installed by 2030 but a report by the UK Floating Wind Offshore Wind Taskforce, said 34 GW could be installed by 2040 if ports were upgraded.

It said up to 11 ports will need to be transformed into hubs to enable the roll-out of floating offshore wind at scale - along with investment of at least 4 billion pounds ($5 billion).

Britain's Crown Estate will launch a tender for 4 GW of floating wind in the Celtic Sea off Wales this year but said the area had the potential to produce more than 20 GW.

While Britain wants to lead the world on floating wind, some experts say South Korea could be the real winner given its existing ports and large-scale engineering capacity.

"South Korea will be commercial the quickest," said Cole at Corio Generation, which has 1.5 GW of floating wind under development there. "People want to buy low-carbon products so how South Korea produces its electricity and how it will decarbonise is a really important thing for the entire economy."

Another issue is the lack of vessels needed to tow structures to their offshore sites, install them and connect the turbines to the onshore power grid.

"Even the largest vessels from the oil and gas industry have limited capacity for efficient installation of the latest floating wind farms," said DNV.

Reporting by Nina Chestney and Susanna Twidale; Additional reporting by Charlie Devreux in Madrid, Yuka Obayashi in Tokyo, Heekyong Yang in Seoul, Nichola Groom in Los Angeles; Editing by Veronica Brown and David Clarke

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Image: A brine pool used to extract lithium is seen at a salt flat of Cauchari Olaroz, near Susques, Argentina, November 8, 2017. REUTERS/Juliana Castilla/ Editing by Germán & Co

Argentina's lithium pipeline promises 'white gold' boom as Chile tightens control

According to Benjamin Gedan, head of the Latin America program at The Wilson Center, "Argentina's lithium sector has grown through a decentralized, pro-market strategy." In contrast, Bolivia's lithium sector "repeatedly stopped as a result of heavy governmental control."

Reuters By Lucila Sigal, Today

BUENOS AIRES, April 24 (Reuters) - In Argentina's mountainous north, a strong pipeline of lithium projects close to coming online looks set to unlock a wave of production that could see its output of the key electric vehicle battery metal as much as triple within the next two years.

The world’s fourth largest producer of the silvery-white metal sits within the so-called "lithium triangle" and has been luring investment from Canadian to Chinese mining firms with a regional and market-led model, even as a wave of resource nationalism has spread in the region.

Neighboring Chile, the region's top lithium producer, last week unveiled plans for a state-led public-private model, spooking investors. Bolivia has long maintained strict control over its huge though largely untapped resources, while Mexico nationalized its lithium deposits last year.

In Argentina, despite state energy firm YPF (YPFD.BA) starting to explore for lithium last year, the sector has largely been driven by private enterprise and regular approvals of new projects as the government has looked to bring in more export dollars through mining, a rare bright spot amid economic turmoil.

"Argentina has granted concessions to projects for the last 10 years," said Franco Mignacco, president of Argentina's Chamber of Mining Business. "That's why today we have this level of lithium investment and development and the chance of growth."

Mignacco estimated that Argentina's current 40,000 tonnes of lithium carbonate production could triple by 2024-2025 to 120,000 tonnes, which could take it past China and closer to Chile which currently produces some 180,000 tonnes per year.

That would be driven by new projects coming online on top of the two currently in production. The country has six lithium projects under construction and 15 in the advanced exploration or feasibility stage, Mignacco said.

That contrasts with Chile, where the industry is dominated by established players SQM (SQMA.SN) and Albemarle (ALB.N), with few new projects underway. In Bolivia the government only recently okayed a new project by a Chinese consortium.

Argentina's production boost would come from the expansion of the only two producing operations - U.S. firm Livent's Fénix project in Catamarca and Australian Allkem Ltd's (AKE.AX) Salar de Olaroz mine in Jujuy - both expected to double output to 42,500 tonnes in the years ahead.

These would be joined by the Cauchari-Olaroz project, owned by China's Ganfeng Lithium Co (002460.SZ) and Canada's Lithium Americas Corp (LAC.TO), which in the second half of 2023 is set to begin production with capacity for 40,000 tonnes of lithium carbonate.

'PRO-MARKET STRATEGY'

Argentina, Bolivia and Chile together sit atop half of the world's resources of the mineral under otherworldly salt flats in the high-altitude Andean plains.

But strategies for developing it are diverging.

"Argentina's lithium sector has thrived through a decentralized, pro-market strategy," said Benjamin Gedan, director of the Latin America program at The Wilson Center, adding in contrast Bolivia's lithium sector had "repeatedly stalled as a result of excessive state control."

Chile, he said, may have found a "savvy middle ground" with its public-private model, which would hand the state majority control over all new lithium projects in a nationalist shift, but would still give private enterprise a key role to play.

The wave of resource nationalism had prompted some talk amongst officials of a potential OPEC-style lithium cartel in the region, though analysts see it as unrealistic given the diverse industry models and levels of development.

Argentina, meanwhile, faces challenges including economic turmoil with high inflation and capital controls which complicate business, while the country is headed for general elections in October creating political uncertainty.

Its lithium pipeline, though, may keep the sector bubbling and even gaining ground on rivals. Overtaking neighbor Chile would be highly unlikely but some analysts were aiming high.

"Chile today produces and exports much more lithium than Argentina," said Natacha Izquierdo, analyst at consultancy ABCEB. "But if the projects we have here today come to fruition, Argentina could overtake it."

Reporting by Lucila Sigal; Additional reporting by Rodrigo Campos; Editing by Adam Jourdan and Marguerita Choy

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image: Deputy head of Russia's Security Council Dmitry Medvedev listens during an interview with Russian media at a residence outside Moscow, Russia, March 23, 2023. Sputnik/Yekaterina Shtukina/Pool via REUTERS

Putin ally: We are probably on verge of a new world war

Reuters

MOSCOW, April 25 (Reuters) - An ally of Russian President Vladimir Putin said on Tuesday that the world was probably on the verge of a new world war and the risks of a nuclear confrontation were rising.

"The world is sick and quite probably is on the verge of a new world war," Dmitry Medvedev, deputy chairman of Putin's powerful security council, told a conference in Moscow.

He said such a new world war was not inevitable but the risks of a nuclear confrontation were growing and more serious than concerns about climate change.

Putin says the world faces the most dangerous decade since World War Two. He casts the war in Ukraine as an existential battle with an aggressive and arrogant West, and has said that Russia will use all available means to protect itself against any aggressor.

The United States and its allies have condemned Russia's invasion of Ukraine as an imperial land grab. Ukraine has vowed to fight until all Russian troops withdraw from its territory, and says Russian rhetoric on nuclear war is intended to intimidate the West into curbing military aid.

Reporting by Guy Faulconbridge; Editing by Alison Williams

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Image: Bruno Le Maire's quest for a French buyer might be a tough mission to accomplish | Teresa Suarez/EPA-EFE/ Editing by Germán & Co

American takeover of French nuclear firm raises concerns in Paris

French government looks to prevent France-based Segault from falling under US ownership via a takeover deal.

POLITICO. EU BY GIORGIO LEALI, APRIL 21, 2023

PARIS — France's feisty Economy Minister Bruno Le Maire has another opportunity to pick a fight with Washington as a sensitive investment screening case is about to land on his desk.

The French government wants to prevent nuclear-submarine parts supplier Segault from falling into American hands just as France and the U.S. are experiencing new tensions over the Inflation Reduction Act, a $369 billion package of green subsidies and tax breaks that Paris and Brussels slammed as a protectionist move in breach of global trade rules.

The two countries have seen an ebb and flow in tensions in recent years that reached worrying levels back in 2021, when the U.S. infuriated France by snatching away a multibillion-euro submarine contract Paris had signed with Canberra. 

Now, the American takeover of the small France-based company with less than 100 employees, which was virtually unknown to most French people until a few weeks ago, is turning into a test of France's industrial sovereignty ambitions.

Segault's current owner, Canada’s industrial valves group Velan, is being bought by American industrial machinery giant Flowserve in a takeover deal announced earlier this year. Segault supplies components for nuclear-propelled submarines built by state-owned shipbuilder Naval Group and also makes industrial valves that are used on France’s flagship Charles de Gaulle aircraft carrier. If the deal goes through, Segault would become American-controlled, raising concerns in Paris' halls of power that Washington would then have access to strategic French technology. 

The deal has become a hot political issue in recent weeks, with right-wing MPs urging Le Maire to block the American buyer, and with a surprise left-wing candidate emerging as a bidder.

The government is currently “looking for a French buyer,” according to a spokesperson for France’s defense ministry, who declined to comment on offers received so far, noting that the French economy ministry has the final word on it.

Under French law, the economy ministry must be informed of the takeover of companies in strategic sectors in order to green-light or veto deals. The government confirmed that Segault's takeover falls within the scope of France’s investment screening powers and will be examined as soon as it is officially notified to French authorities.

Investment screening decisions are first assessed at the technical level within France’s powerful economy ministry, known as Bercy, but they also have a political dimension as they are ultimately taken by the economy minister himself via a decree. In the past, Le Maire has not hesitated to use his veto powers for politically sensitive cases, turning investment screening cases into political battles. In a bid to cast himself as a defender of French industrial jewels, Le Maire widened the scope of investment screening powers in 2019, during his first term.

As in many other EU countries, the scope of France's veto powers was further extended during the coronavirus pandemic, to prevent the risk that companies weakened by the crisis could be bought by foreign investors. Those new powers, which were meant to be temporary, have been repeatedly extended amid the economic crisis linked to Russia's full-scale invasion of Ukraine.

The Segault case is also seen as an opportunity for Paris to show its muscle.

For socialist Michel Sapin, who served several times as France’s finance and economy minister, the deal gives the government an opportunity to present itself as a defender of national gems by taking “a braggart position on re-industrialization and industrial sovereignty” that, according to him, has not been backed up by action so far. 

“We can’t deny that we have some irritants with Americans, especially the IRA in this phase,” said Macron’s ally Marie-Pierre Vedrenne, vice chair of the European Parliament’s trade committee, while noting that France’s investment screening won’t discriminate against U.S. buyers. 

But Macron's allies were also quick to insist that Paris’ efforts to take Segault away from its American buyer was not a protectionist attempt to block a U.S. investment.

“The criteria won’t be friendship or mistrust toward Washington,” said a French minister, who was not authorized to speak publicly on the matter, adding that “the context” should not prevent Paris from “controlling some sovereignty aspects” of the deal.  

For Vedrenne, Macron's ally in the European Parliament, "the Americans are first of all in a mindset of prior defense of their interests and we see it with this case … sovereignty is at stake so we have to be vigilant whatever the nationality [of the buyer] is, even if it is an ally, because the defense of the French interests must be examined above all.”

Despite some displays of friendship, tensions between Paris and Washington have risen at a steady pace over recent months and increased after French President Emmanuel Macron told POLITICO that Europe should not be “America’s followers” when it comes to China policy. 

Le Maire has also been particularly harsh with the U.S., accusing Washington of using Russia’s war in Ukraine to establish “economic domination” and of breaching WTO rules with its massive subsidy package, the Inflation Reduction Act. Earlier this month, he said that Europe should, much like the the U.S. and China, put first its own industrial interests and stop obeying the free-trade dogma. 

Earlier in the month, as he visited Washington, he accused "some" in the U.S. of applying double standards when it comes to trade with China. "I see that the volume of trade between China and the United States has never been so high ... we are asking Europe to give up trade that has increased between the United States and China. We don't want to be the village idiots, who get screwed and let other powers trade with China while we would no longer have the right to do so," the minister said.

Should France decide to veto the deal, Segault could be carved out from Flowserve's acquisition of Velan. However it is unclear whether the American buyer would still be interested in buying Velan without Segault.

Le Maire's quest for a French buyer might be a tough mission to accomplish.

Another former economy minister and “Made in France” champion, socialist Arnaud Montebourg urged Le Maire to block the deal earlier this month and offered to buy Segault together with the help of Pierre-Edouard Stérin, a businessman who in the past has been close to far-right former presidential candidate Eric Zemmour.

A person with direct knowledge of the file but who was not authorized to speak publicly said that it is unlikely Le Maire would back Montebourg's offer.

Elisa Braun contributed reporting.

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News round-up, April, 24, 2023

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Dear friends:

Although the human being is the result of the fusion of male and female gametes, two people are inevitably needed for procreation.  However, due to this dual nature and the fact that we build our lives within a tribe, humans are inclined to become selfish, possessive, and jealous of their territory, which takes them further away from their beginnings.

However, I have had the great fortune to have the support of human beings who are far from insignificant and who persevere in their human vocation. Today is the day of the moon; it could be just another Monday that begins the so-called "week," but this lunar day of April 24, 2023, invokes gratitude within me.  Therefore, I want to recall the philosophical writings of St Thomas Aquinas on appreciation – or "moral debt" as he called it.  From the bottom of my heart, I thank Bernerd, Juan Ignacio, Ricardo, Bredyg, Armando, Gonzalo, Madelka, Mayka, Paula, Matt, and those who remain in the inkwell for the journey of memory.

Finally, I want to share some indicators—just cold numbers—of what this blog has achieved in its short life.  We have more than 250K on Twitter and 200K on LinkedIn, and at Energy Central, we have 61K readings with a 96K reputation – reaching the number 12 spot among top influencers, all thanks to you.

I wish you the best and, above all, good health.

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Source: EnergyCentral

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Most read…

EPA plan would impose drastic cuts on power plant emissions by 2040

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WP; By Timothy Puko, TODAY

Tech Billionaires Bet on Fusion as Holy Grail for Business

Avalanche Energy, a Lowercarbon Capital venture, recently closed a $40 million Series A financing. CEO of Avalanche Energy, Robin Langtry, stated that the business focuses on fast developing and testing remote systems using equipment readily available in the marketplace, such as an ultrahigh vacuum chamber bought on eBay.

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Andrés Gluski, CEO of energy and utility AES Corp

How can strategic investment achieve both economic growth and social progress?… What is the role of renewable energy and battery storage in achieving the goals of the low-carbon economy?…

The AES Corporation President Andrés Gluski, Dominican Republic Minister of Industry and Commerce Victor Bisonó, and Rolando González-Bunster, CEO of InterEnergy Group, spoke at the Latin American Cities Conferences panel on "Facilitating Sustainable Investment in Strategic Sectors" on April 12 in Santo Domingo, Dominican Republic.

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Today's events

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Today's events 〰️

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Image: Steam rises from Duke Energy’s Marshall Power Plant in Sherrills Ford, N.C., in November 2018. (Chris Keane/Reuters)/ Editing by Germán & Co

EPA plan would impose drastic cuts on power plant emissions by 2040

A long-awaited climate rule, which is sure to face legal challenges, would push plants that burn fossil fuels to use carbon-capture technology or hydrogen

WP; By Timothy Puko, TODAY

The Biden administration is preparing to unveil a proposal to require power plants to drastically reduce their greenhouse-gas emissions by 2040, another attempt to regulate one of the country’s biggest contributors to climate change after the Supreme Court struck down the first effort, according to three people familiar with the plans.

If implemented, the Environmental Protection Agency would set limits so stringent that fossil-fuel-burning power plants probably would have to use technology to capture their carbon dioxide emissions from their smokestacks or switch to other fuels to comply, according to the three people, who spoke on the condition of anonymity to discuss a plan that is not yet public. The proposal is still under final analysis at the White House and could change before the EPA completes and announces it.

The limits could nearly eliminate emissions from fossil-fuel burning plants after the most stringent standards go fully into effect, the people said. Another source familiar with the proposal said that there will be significant cuts to emissions from these plants, but potentially not as dramatic or extreme as others have suggested.

The EPA has been planning an announcement for the coming days, but final details are in flux, and a formal proposal could be more than a week away, according to several people familiar with the planning. Turning that proposal into a final rule package would be likely to take months more, and, according to two of the people familiar with the details, many of the proposal’s most stringent standards would not take effect until the 2030s, giving industry years to come into compliance gradually.

Although its greenhouse-gas emissions have been declining, the electric-power sector remains the country’s second-largest contributor to climate change, being responsible for a quarter of such emissions nationwide in 2021, according to EPA data. That has long made power plants a top target for climate regulations, and President Biden has previously promised to eliminate their emissions by 2035.

The Supreme Court has loomed over the effort. It ruled last year that the EPA during the Obama administration had exceeded its authority by building the first attempt at such regulations around a new system to push power companies to switch fuels across their fleets, and replace coal with cleaner options. The updated rules that Biden has promised have been held up for months in part because the agency has been trying to craft them in accordance with that decision so they might survive a conservative-majority court.

The administration’s plan is to stick with rules that apply within a plant’s fence line, with limits on the amount of what each plant can emit, according to four people familiar with the effort. They will be applied through rules for new gas-fired plants, and existing gas-and-coal-fired plants, those people said.

The policy would not mandate any type of technology or fuel, according to the three people familiar with the latest details. But they said the limits it sets would be so stringent that to meet them, fossil-fuel-burning plants most likely would need to use carbon-capture technology or be capable of switching to use hydrogen, which burns without greenhouse-gas emissions.

Some of these details were previously reported by the New York Times.

“EPA cannot comment because the proposals are currently under interagency review,” agency spokeswoman Maria Michalos said in an emailed statement. “But we have been clear from the start that we will use all of our legally-upheld tools, grounded in decades-old bipartisan laws, to address dangerous air pollution and protect the air our children breathe today and for generations to come.”

What is Willow? How an Alaska oil project could affect the environment.

The agency has been issuing a raft of new rule proposals just in recent weeks as it attempts to fulfill Biden’s big climate promises before he faces reelection. The administration spent most of its first year pushing its climate agenda through legislation, and now that Congress approved nearly $370 billion in new climate spending, Biden officials are trying to finish accompanying regulations before Republicans have a chance to take power and undo them.

Fossil-fuel advocates — including several Republican-led states — have vowed to fight these moves in court. And if Republicans take majorities in Congress, they could also use the Congressional Review Act to repeal any regulations that weren’t finalized within 60 legislative days of it being implemented.

Many of the new proposals aim to reduce air pollution and greenhouse-gas emissions from the power sector. Just last week the EPA announced the strictest restrictions ever on emissions for cars and trucks, the country’s largest source of planet-warming emissions. It has also promised later this year to finish a proposed rule on the oil and gas industry’s emissions of methane, which traps roughly 85 times more heat in the atmosphere than carbon dioxide.

Researchers who model emissions say that this collection of regulations is essential for meeting Biden’s commitment to cut total U.S. emissions in half from 2005 levels by 2030. Last year’s climate spending bill, called the Inflation Reduction Act, would get the country on course to reduce emissions by up to 42 percent by that target date. The executive actions on power plants, vehicles and methane would take it most of the rest of the way, another 6 percentage points of reduction, according to analysis released last month by the Rhodium Group.

But environmental groups are concerned the specifics of the EPA’s power-plant proposal may not be strong enough, and are planning to push for faster timelines, according to two people familiar with the response granted anonymity to speak about plans that aren’t yet public. Several leading environmental groups declined to analyze the proposal Saturday, saying they would need to wait until the EPA makes details public.

Urgency will be a top concern, and a 2040 timeline does not match Biden’s initial promise to zero out the sector’s emissions by 2035, said John Paul Mejia, national spokesman for the Sunrise Movement. He also noted concerns about any plan that relies on carbon capture and hydrogen technology, which are opposed by environmental justice groups that advocate for minority and poor communities and say those technologies are ways to sustain historical polluters like the oil and gas industry.

“This is a step in the right direction, but it needs to be much more stringent,” Mejia said. “This proposal should be in line with the scale of ambitions that were promised to us.”

Fossil fuels — almost exclusively gas and coal — still accounted for roughly 60 percent of the country’s electricity last year, according to Energy Department data. Utilities have been moving to zero-emissions sources, mostly wind and solar, retiring a lot of fossil fuels, especially coal, and that trend shows signs of slowing. After retiring about 11 gigawatts of coal-fired capacity annually from 2015 to 2020, the industry plans to shutter 8.9 gigawatts this year, according to the U.S. Energy Information Administration.

To help them reduce their emissions, Congress has provided subsidies to develop carbon-capture technology and make it more profitable. A federal tax credit provides as much as $180 per metric ton for businesses that use it. The Inflation Reduction Act also boosts by 70 percent the tax credit for the troubled legacy carbon capture technologies oil and gas companies have traditionally used to get more oil out of the ground, increasing it to $60 per ton.

Changes like those factor into EPA rulemaking. If the technology needed to comply is cheaper and more efficient, the agency can use that in its rulemaking to raise standards on the basis that it should be easier for businesses to meet them.

The agency is also factoring in flexibilities for plants, according to two people familiar with the details. Targets will vary at each plant based on size and use, and some coal-fired plants scheduled to retire in the coming years may not have to meet the new standards at all, the people said.

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Seaboard: pioneers in power generation in the country

…Armando Rodríguez, vice-president and executive director of the company, talks to us about their projects in the DR, where they have been operating for 32 years.

More than 32 years ago, back in January 1990, Seaboard began operations as the first independent power producer (IPP) in the Dominican Republic. They became pioneers in the electricity market by way of the commercial operations of Estrella del Norte, a 40MW floating power generation plant and the first of three built for Seaboard by Wärtsilä.

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Image: Billionaires, clockwise from lower left, Jeff Bezos, Bill Gates, Marc Benioff, Vinod Khosla and Peter Thiel. PHOTO ILLUSTRATION BY EMIL LENDOF/THE WALL STREET JOURNAL; PHOTOS / Editing by Germán & Co

Tech Billionaires Bet on Fusion as Holy Grail for Business

Avalanche Energy, a Lowercarbon Capital venture, recently closed a $40 million Series A financing. CEO of Avalanche Energy, Robin Langtry, stated that the business focuses on fast developing and testing remote systems using equipment readily available in the marketplace, such as an ultrahigh vacuum chamber bought on eBay.

Germán & Co

Jeff Bezos and Bill Gates are among titans chasing almost Iimitless energy source

WSI By Jennifer Hiller, April 23, 2023 

Sam Altman became a tech sensation this year as the CEO of OpenAI, the artificial-intelligence startup that seems pulled from science fiction. 

But Mr. Altman, who has been among Silicon Valley’s most prominent investors for more than a decade, has placed one of the biggest bets of his career on a company that might be even more futuristic: a nuclear-fusion startup called Helion Energy Inc. 

He is one of a number of tech founders and billionaires who hope to harness the process that powers the sun and stars to deliver almost limitless energy. Jeff Bezos, Peter Thiel, Bill Gates and Marc Benioff are among those betting that the decadeslong goal of building fusion reactors is now within years of being reality.

Mr. Benioff calls fusion a “tremendous dream.”

“It’s the holy grail. It’s the mythical unicorn,” said Mr. Benioff, the CEO of Salesforce Inc., who invested in the Massachusetts Institute of Technology spinout called Commonwealth Fusion Systems, which aims to create compact power plants. Mr. Gates is also an investor. 

Fusion has long been seen as a clean-energy alternative to sources that burn fossil fuels and release greenhouse gases. Other technologies and applications being developed in the race for fusion power include powerful magnets, better lasers or radiation therapy for cancer research.

Fusion, Mr. Benioff added, “has no limits if you can get it to work.”

Developers mostly in the U.S., Canada and Europe have been riding a wave of momentum since August 2021, when scientists at Lawrence Livermore National Laboratory came close to achieving more energy in a fusion reaction than was put in with lasers, a goal known as net gain.

Many grew to believe that a breakthrough was imminent. It came in December when the national lab achieved net gain for the first time.

Nuclear fusion occurs when two light atomic nuclei merge to form a single heavier one. That process releases huge amounts of energy, no carbon emissions and limited radioactivity, but companies would have to sustain fusion reactions and engineer a way to turn that energy into net power. 

The old saw about fusion is that it is a mirage years away and always will be. It is a long-shot bet even with the high-risk world of venture funding. 

Mr. Benioff said he was persuaded by Vinod Khosla, the Sun Microsystems co-founder who was an early investor in private fusion, historically the province of academia and national labs.

Mr. Khosla’s interest hinged on the ability to build a large high-temperature superconducting electromagnet. He spent 15 months on due diligence and hired three teams to evaluate the design before investing. 

He thinks that several fusion designs should be tested and is investing in another firm, Realta Fusion, a spinout from the University of Wisconsin-Madison. “Even if one of them can work, the planet is much better off is how I look at it,” he said.

As an investor, Mr. Khosla sees fusion this way: “Financially either you lose one times your money or you can make a thousand times your money,” Mr. Khosla said. “That’s the math of fusion.”

Industrial firms, major oil companies and sovereign-wealth funds are backing efforts along with the Department of Defense, which is in search of a toaster-sized power system for satellite propulsion.

“There’s a reasonable probability at least one, maybe two companies will demonstrate fusion conditions in this decade,” said Ernest Moniz, who is the chief executive of the nonprofit research group Energy Futures Initiative and a former U.S. Energy Secretary.

Mr. Moniz, a physicist, said that improvements in large-scale machine learning have sped experiments and helped several companies achieve or approach the extreme temperatures and pressures needed for fusion reactions.

Firms and their backers see parallels with recent advances in artificial intelligence, which also requires colossal amounts of computing power to run models.

Mr. Altman, whose company OpenAI is behind the viral artificial-intelligence chatbot ChatGPT, has put $375 million into Helion.

Everett, Wash.-based Helion uses a technology called magneto-inertial fusion and aims to prove it can produce net electricity next year. 

At Helion, Mr. Altman is more than a passive investor. “I send people for him to vet and interview,” said Helion Chief Executive David Kirtley.

Some Helion employees have started using ChatGPT to see how it can speed up engineering work, Mr. Kirtley said. Other investors, including Mr. Thiel’s Mithril Capital, have previously joined calls to help Helion negotiate with suppliers.  

The Fusion Industry Association, based in Washington, D.C., has tracked more than $5 billion in private funding, with seven firms raising at least $200 million. Around 75% of fusion fundraising has happened since 2021, according to PitchBook.

A company called Lowercarbon Capital, founded by early Twitter and Uber venture investor Chris Sacca, launched a fusion fund last year with investors that include endowments, corporations and family offices.

Clay Dumas, a founding partner, said Lowercarbon Capital was persuaded that fusion was at a turning point because regardless of the design, firms were notching technical milestones.

“Growing access to computational power and breakthroughs in materials science were accelerating their progress faster than anyone expected,” Mr. Dumas said.

Lowercarbon Capital’s investments include Avalanche Energy, which has closed a $40 million Series A round. Avalanche Energy CEO Robin Langtry said the company is focused on small systems it can build and test quickly with commercially available equipment, including an ultrahigh vacuum chamber purchased on eBay.

“We want to build the smallest fusion reactor in the world. Then we’re talking about a project that’s maybe tens of millions of dollars, not billions, and you could actually do it with a small team,” he said.

Air Force Maj. Ryan Weed, a plasma physicist and test pilot with the Pentagon’s Defense Innovation Unit, which contracted with the company, said that testing such an approach 20 years ago might have cost $50 million, but much of the work can now take place on a computer at minimal cost.

The DIU wants a nuclear power source that could provide electrical power out of a device the size of a toaster oven or microwave some time in the next five years, said Mr. Weed, who pointed to a need for small satellite propulsion systems in cislunar space, the area between Earth and the moon.

Do you think fusion will be the next business breakthrough? Join the conversation below.

Achieving fusion is so difficult that firms are developing other products as they test machines. That intellectual property has value independent of fusion, said Adam Rodman, founder of the hedge fund Segra Capital Management LLC, which invested in Canadian company General Fusion. Mr. Bezos, founder of Amazon Inc., has also backed General Fusion.

Technologies will eventually need to show a path to profit and not just scientific breakthroughs.

“A lot of these are not businesses—they are tech developers,” said Barbara Burger, who is former president of Chevron Technology Ventures and holds several advisory and board positions. “Until you have revenue, you don’t have a business.” 

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Image: President Biden listens during a climate forum at the White House on Thursday. The administration faces a looming deadline to find a way to get Congress to raise the U.S. debt limit. (Elizabeth Frantz for The Washington Post)/ Editing by Germán & Co

Biden is running out of time to avoid calamitous debt ceiling outcomes

The GOP’s willingness to court economic disaster without major spending cuts leaves White House aides in a bind

WP, by Jeff Stein, April 22, 2023

President Biden is running out of time and options to avert an unprecedented default on the federal debt, as House Republicans make increasingly clear that they are willing to court economic catastrophe unless they secure major policy concessions from the White House.

Since Republicans took control of the House in January, Biden’s top aides have expressed confidence both privately and publicly that they can force the GOP to raise the limit on federal borrowing without even partially acquiescing to conservative demands to cut spending.

House GOP unveils bill to cut spending, lift debt ceiling. Here’s how?

But so far, that strategy does not seem have worked. House Speaker Kevin McCarthy (R-Calif.) released a plan on Wednesday that his caucus broadly backed, and GOP leaders hope to pass it in the House next week. There’s little indication yet that Republicans will break off and agree to lift the debt ceiling without conditions, as Biden insists. And attempts by the administration to enlist corporate executives to build pressure haven’t yielded much either, at least not yet.

Instead, many GOP lawmakers appear to be prepared to allow the nation to default without major spending cuts and policy changes — setting up what appears to be a choice between two outcomes that White House officials consider unacceptable.

“At this point, there is no indication whatsoever that moderate Republicans would agree to lift the debt limit with no reforms from the administration,” said Brian Riedl, a policy analyst at the Manhattan Institute, a center-right think tank. “I don’t see that happening. They would be crucified within their own caucus.”

Inside the White House, the GOP’s hardening position on the debt limit has been met with anger and frustration. Biden aides adamantly reject the idea they should agree to anything resembling the spending cuts and policy changes that McCarthy has put forward — both because they oppose the substance of the ideas and because they do not want to reward the GOP for what they regard as its efforts to take the U.S. economy hostage. Biden aides are further frustrated by claims that the GOP has a popular mandate behind it, since Republicans failed to retake the Senate and only captured the House by a handful of seats.

One person familiar with the White House’s thinking, speaking on the condition of anonymity to describe internal deliberations, emphasized that House Republicans would be forced to go on record supporting McCarthy’s bill, which would impose new work requirements, reduce the number of Internal Revenue Service agents and block Biden’s move to cut student debt — measures the administration believes will prove highly unpopular with the American public.

Analysis: So much for that promise: Debt bill talks again done in the backroom

Biden has welcomed the possibility of negotiations with McCarthy on government spending levels — talks that could resolve the debt ceiling debate while allowing the administration to claim it is not negotiating over the nation’s spending limit. The person familiar with the White House’s thinking said “they are going to have to start having conversations on budget and spending, as the president has all along.” The president told congressional Democrats earlier this week that the administration is ready for a separate negotiation with Republicans over the budget, according to a White House statement.

“Let’s be clear about the Speaker’s position: unless the President and the Senate agree to their entire reckless agenda, they are going to crash the economy. That’s not just unreasonable — it’s dangerous,” White House spokesman Michael Kikukawa said in a statement. “The President has been clear: we must avoid default — that’s nonnegotiable — but he will gladly have a separate conversation about the budget with congressional leaders.

If Congress doesn’t increase the limit on how much the Treasury Department can borrow, the federal government will not have enough money to pay all its obligations by as early as June. Such a breach of the debt ceiling — the legal limit on borrowing — would represent an unprecedented breakdown, which economists believe could spark a global financial panic and lead to a recession in the United States.

White House aides have held numerous internal strategy meetings that have explored the potential downsides of trying to lift the debt ceiling unilaterally, without Congress, according to three people familiar with the matter, who spoke on the condition of anonymity to describe private deliberations. Many economists believe such any such move could lead to a permanent increase in U.S. borrowing costs, because investors would demand higher interest rates for buying U.S. bonds of legally dubious status.

Mint the coin? Buy back bonds? 7 ‘gimmicks’ for dodging the debt limit.

Democratic officials have cited as a hopeful precedent the dynamics of past debt ceiling fights, in which pressure from business executives forced the GOP to lift the limit.

“If we do actually start to get close to the drop dead date, and you can’t pay the bills, I’m sure we’ll see a reaction in financial markets and people will put pressure on Republicans for trying to wreck the economy,” said Dean Baker, a White House ally and economist at the Center for Economic Policy Research, a left-leaning think tank. “If we get to that point, you’ll see them backing down.”

And yet, with as few as six weeks to go, little evidence has materialized to suggest that will happen. Financial markets have thus far shrugged off the debt ceiling drama, with almost no discernible movement even in the price of U.S. Treasury bonds. The relative calm in markets has, in turn, relieved pressure on lawmakers to act — which could increase the odds Congress fails to lift the debt limit in time.

Fiscal crisis nears as McCarthy takes debt ceiling plan to Wall Street

“I don’t think lawmakers act until they get calls from investors and others in the business community saying: ‘What are you doing?’ But we’re not hearing those voices yet, because they think lawmakers have always done the right thing and acted just in time,” said Mark Zandi, chief economist of Moody’s Analytics. “It’s a very dangerous drama playing out here.”

The administration’s attempts to enlist the support of business executives may also prove unsuccessful. White House Chief of Staff Jeff Zients has personally asked top business leaders to advocate for a solution to the debt ceiling debate, according to two people familiar with the matter, who also spoke on the condition of anonymity to discuss private remarks. But corporate America doesn’t have as much clout with the GOP as it did in the Obama years, and it’s not clear such measures will be effective with the House conservatives who nearly derailed McCarthy’s leadership bid earlier this year.

“What are we going to do, call them and say, ‘Hey, the debt limit is important?’ They know it’s important,” said one business executive who had been asked by administration officials to press the GOP on the matter, speaking on the condition of anonymity to reflect private conversations.

White House aides may have less time than they anticipated. An economic slowdown could lead to less revenue coming into the Treasury Department, which would hasten the deadline. While acknowledging the data was preliminary, Goldman Sachs analysts said earlier this week that “weak” tax collections in April suggested that the debt limit could be reached in the first half of June, earlier than initially forecast.

Biden aides want to force GOP to abandon debt limit threats

The war of words between the Democratic president and the Republican speaker of the House has become increasingly pitched — and occasionally petty.

On Wednesday, McCarthy said Biden is “giving America’s debt the Southern border treatment — ignore it and hope it goes away.” For his part, Biden is increasingly accusing McCarthy of being reckless with the credit of the United States, beholden to MAGA extremists and misleading Americans about his plan. Last month, McCarthy offered to bring “soft food” to a meeting with Biden at the White House to entice him into a confab about the debt ceiling, an apparent dig at the 80-year-old president’s age.

On Wednesday, it took Biden all of 72 seconds to get through introductory remarks before dinging McCarthy.

“I’m here in this union hall with you when, just two days ago, the speaker of the House, Kevin McCarthy, went to Wall Street to describe the MAGA economic vision for America,” he said, the first of five times that he’d mention McCarthy by name.

Some Democrats say House Republicans face even more political backlash in a debt ceiling breach than Biden, arguing the president is right to hammer the GOP over its proposed spending cuts. Traditionally, Democratic candidates have had low approval ratings on the economy, but a GOP-caused default could give them an opening to change that, said Celinda Lake, a pollster who worked for Biden in 2020.

“We have a huge advantage in selling this contrast,” Lake said. “If Republicans get blamed for shutting down the economy, that will change the dynamics.”

But other Biden allies point out that the economic devastation from a default could persist into next year, affecting the 2024 presidential election. Presidential approval ratings tend to be closely tied to economic performance, and the long-feared recession could materialize if the U.S. government suddenly can’t pay its bills.

“The two endpoints on the spectrum of outcomes — the full GOP policy wish list on the one hand, or a catastrophic default on the other — are both totally unacceptable to them,” said one person in communication with senior White House officials, who spoke on the condition of anonymity to frankly describe private conversations. “But no progress has been made on making sure there’s a resolution that’s between those two options.”

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Image: How Wall Street investors react to a possible default is crucial because they’re the ones who finance the country’s enormous debt. | Bebeto Matthews/AP Photo/ Editing by Germán & Co

Wall Street starts to fear a debt limit crisis

The government has until the summer to strike a deal…

WSJ By BEN WHITE, SAM SUTTON and ELEANOR MUELLER, 04/24/2023

NEW YORK — For months, Wall Street has barely focused on the possibility that the government might default on its debt. It’s paying attention now.

As the drop-dead date to raise the nation’s $31.4 trillion debt ceiling looms with no deal in sight, traders and executives are starting to get nervous that President Joe Biden and Republicans won’t resolve the impasse until it’s too late. That’s sparked increasing concern about a potential threat that could rock markets and tilt the world’s largest economy into recession.

“There is this view in D.C. that the market isn’t freaking out enough, and that may be true to an extent,” said Alec Phillips, chief political economist at Goldman Sachs. “But I’ve been dealing almost exclusively with this issue the last few weeks, and there is actually more concern now than even in 2011,” when Standard & Poor’s downgraded U.S. debt during a similar standoff. “It’s just that nobody knows when it’s going to happen or what to do about it.”

How Wall Street investors react to a possible default is crucial because they’re the ones who finance the country’s enormous debt by buying the securities that Treasury sells to fund the government. If they shy away from the market, interest rates could skyrocket, squeezing the government, businesses and consumers.

That’s why their level of confidence can serve as the strongest force to drive Washington partisans to make a deal.

Schumer: GOP risks ‘economic disaster’ over debt ceiling

For most of this year, many on Wall Street assumed that lessons learned from the 2011 crisis — including voters furious over declines in their retirement accounts as stocks plunged — would prevent such an event from happening again. That faith is starting to fade.

“Debt ceiling negotiations are essentially nowhere,” Brian Gardner, chief Washington policy strategist at investment bank Stifel, wrote in a note to clients. Gardner added that while a last-minute deal could certainly emerge, “the GOP’s narrow majority and the Speaker’s tenuous political position make the pathway to an agreement more uncertain than usual.”

To be clear, it’s nowhere near all-out panic. The government has until the summer to strike a deal, when the Treasury Department is likely to run out of room to keep paying the nation’s bills and servicing its existing debt.

But signs of stress are piling up, especially after House Speaker Kevin McCarthy came to the New York Stock Exchange on April 17 to make the GOP case that any hike in the borrowing limit must come with significant spending cuts. That’s something the White House and congressional Democrats say they won’t consider.

The shift from general nonchalance to rising concern can be seen in an obscure corner of the markets: the soaring cost of insuring against exposure to U.S. debt through instruments called credit default swaps, which mitigate risk for large holders of Treasury securities.

The cost of insuring against a U.S. default rose to its highest level in over a decade on Thursday as JPMorgan analysts said there was a “non-trivial risk” of at least a technical default on the government’s debt in which the nation runs out of borrowing ability for even a short period before a deal is reached.

Manchin: Holding the debt ceiling 'hostage' doesn't work

Darrell Cronk, chief investment officer of Wells Fargo’s wealth and investment management division, said his biggest worry is that the “X-Date” — the moment when emergency moves to forestall default are exhausted — gets pulled forward to early-to-mid June with 2022 tax receipts likely weak after a brutal year for markets.

Goldman Sachs researchers said they also expect a much shorter timeline due to a steep reduction in capital gains revenue. And McCarthy’s hardline position — as well as questions about whether he can unify House Republicans over any strategy at all — have amped up alarms. “People seem to be dug in a little bit more in the trenches,” Cronk said.

“People seem to be dug in a little bit more in the trenches.”

Darrell Cronk, chief investment officer, Wells Fargo wealth and investment management division

Some bank executives said they are growing more concerned about the state of play in Washington but remain unsure how to inject themselves into the debate. Speaking out would be unlikely to sway hard-line conservatives, they fear, given that such calls would probably be dismissed as special pleading by rich Wall Streeters.

So for now, they are mostly issuing anodyne statements arguing for the importance of not allowing the U.S. to default, in a bid to nudge the two sides toward a solution.

Following McCarthy’s address, congressional Republicans urged bankers to press Biden to engage with the GOP.

“Obviously, people [on Wall Street] are worried,” Sen. J.D. Vance of Ohio said in an interview. “We’ll just say, ‘Look, it’s a two-party system. And Kevin McCarthy gets to make the first shot across the bow, but they need to put pressure on Joe Biden, to the extent they’re able to, to actually come to the negotiating table.’”

Rep. Warren Davidson of Ohio said he’s telling bankers that “the only way that we’re going to not default later is if we start taking corrective action now.”

“Joe Biden’s plan is to not take corrective action now,” said Davidson, a member of the House Freedom Caucus. “That’s a nonstarter. We’re not going to move his ‘no action now’ bill,” he said, referring to Democrats’ hopes of passing a “clean” debt limit hike with no spending cuts.

Democrats expressed frustration that the financial world hasn’t exerted more pressure on Republicans.

“Wall Street and business need to start getting energized and put pressure on Republicans to do what we’ve done all these years, which is pay for the debt that we incurred and not hold the American people hostage,” said Rep. Pramila Jayapal of Washington, who chairs the Congressional Progressive Caucus.

Senate Banking Chair Sherrod Brown (D-Ohio) said he was confident Wall Street would eventually speak up. “But I think that it’s telling that McCarthy went to Wall Street to talk about all this because he’s Wall Street’s guy,” Brown added. “So we’ll see.”

Meanwhile, concerns over the impact that a nasty fight over the debt limit could have on the economy are showing up on bank earnings calls.

Goldman CEO David Solomon identified uncertainty over the debt limit as a potential source of volatility during the bank’s call on Tuesday. An hour earlier, responding to a question from POLITICO, Bank of America CFO Alastair Borthwick told reporters he didn’t have much to say on the status of non-existent negotiations between the White House and McCarthy.

“Obviously, we’re all hoping that gets resolved successfully,” he added.

Citi CEO Jane Fraser said her bank believes it’s “now more likely that the U.S. will enter into a shallow recession” later this year. “The biggest unknown,” she told analysts on the bank’s recent earnings call, is “how the debt ceiling plays out.”

BlackRock Vice Chair Philipp Hildebrand warned at the Bloomberg New Economy Gateway Europe Forum on Thursday that default would undermine “a basic anchor” of the world’s financial system and “must not happen.”

“All we can do is to pray that everyone in the United States understands how important the sanctity of the sovereign signature of the leading currency, of the leading bond market, of the leading economy in the world is,” Hildebrand said.

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Image: Germán & Co

Cooperate with objective and ethical thinking…

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Image: Fighting in Khartoum: Large parts of the city are no without electricity and water. Foto:
Abdullah Moneim / dpaREUTERS/Christian Mang/ Editing by Germán & Co

The Battle of the Generals

A Bloody Turn in Africa's Story of Hope

Two rival generals have sparked a war that has buried hopes for a peaceful and democratic fresh start in Sudan. The activists who once brought down the dictatorship are now fearing for the future – and for their lives.

By Heiner Hoffmann und Fritz Schaap in Nairobi, Kenya, 22.04.2023

A dull bang, first further away, then louder and louder. Shadin Alfadil is still in bed when she begins hearing the sounds early on Saturday morning. But she's already familiar with it from the demonstrations she has regularly been attending for more than four years now.

She has heard it immediately before fellow campaigners, friends, collapsed dead, their blood spilling out on the asphalt. She knows what gunshots sound like. And she knows all too well what they can do.

Alfadil, a young Sudanese woman with a serious face and a firm voice, reaches for her smartphone, with new messages constantly popping up on the screen. "Shots fired downtown." Or later: "Airstrikes in Khartoum." She related her story in a telephone interview with DER SPIEGEL.

Shadin Alfadil: "We had to prevail with the revolution."

It is, for now, the nadir in the history of a revolution that filled not just Sudan, but the whole world with hope. It has been four years since Alfadil first joined thousands of others on the streets of Khartoum in a death-defying act of protest. Starting in December 2018, the Sudanese wrote one of the most impressive chapters of the Arab democracy movements for their country - one which has been ravaged by massacres, famine and crises over the years. They managed to achieve what no one had believed possible: They protested until they drove dictator Omar al-Bashir from office. After 30 years of dictatorship, democracy suddenly seemed within reach. Sudan had become emblematic of what can be achieved through peaceful resistance.

Since then, though, hopes for democracy have been further and further destroyed by the country's powerful military. And now, those dreams could be buried for good in a hail of bombs.

Fighting in the Backyard

Alfadil has shifted into emergency gear. With the violence spreading, she checked her supplies of food and water on Monday. And quickly realized that she wasn't in good shape. It was still Ramadan, the Muslim month of fasting, during which many of the faithful eat only after sundown and with only scant supplies of food at home. "I try not to get too full so that the supplies will last for a while," she told DER SPIEGEL by phone on Monday. "We haven't had any running water since yesterday."

Alfadil speaks fluent English and works for an international organization. But none of that is of any help to her now. The fighting outside her door continues, and few in Khartoum dare to go outside. She says that one of her parents' neighbors was shot to death on Sunday.

Since the early hours of Saturday morning, Africa's third-largest country has been in a state of war. There is fighting in almost all parts of the country, with two rival generals and their armies facing off against each other. On one side is Sudan's regular armed forces, commanded by the de facto president, General Abdel Fattah al-Burhan. On the other is the paramilitary Rapid Support Forces (RSF), under the command of his deputy Lieutenant General Mohamed Hamdan Daglo, known as Hemeti. Hemeti's forces are estimated to include around 100,000 fighters.

A Failed Transition of Power

It is a power struggle between two men, a civil war without civilians, being waged entirely by the military - but with heavy weapons, artillery and fighter jets. By Thursday, hundreds of people had already died, and thousands were injured. The Khartoum airport has been badly damaged and there are no more scheduled flights. Fighter jets circle overhead and shells are exploding in the middle of residential areas. Those who can have been fleeing the city, and the rest, like Shadin Alfadil, have entrenched themselves in their apartments and basements.

It was supposed to be a month of hope. An agreement had been signed back in December according to which Burhan and Hemeti agreed to hand over power to a civilian-led government. It was supposed to have happened on April 11.

It could have been a new attempt to finally complete the revolution. That, at least, is what people like Alfadil had hoped.

For that to happen, though, the two men would have had to reach agreement on how to combine their two forces, a step that is a key part of the agreement. Burhan wanted to integrate the RSF into the regular army within two years. But Hemeti had insisted on a 10-year transition period. The question of what the future command structure should look like also produced irreconcilable differences, as did the prospect that they could eventually be tried for crimes themselves. Out of fear of losing their own influence, the generals turned on each other.

Pressure from Abroad

It's hard to say who has the upper hand in the fighting. Sudan expert Alex de Waal, director of the World Peace Foundation at Tufts University near Boston, sees the army as having an advantage, at least in the short term. But therein lies another danger. "I think they will try to press their advantage and keep fighting, and the window of opportunity for negotiations will pass," he says. But winning, de Waal is certain, is something the army cannot do, at least not across the entire country.

He argues that Egypt, Saudi Arabia and the United Arab Emirates, countries that wield a fair amount of influence in Sudan, need to quickly move to exert pressure. "With every day that passes without them (the regional powers) getting their act together, the dangers escalate because the conflict becomes more complex. And then it will become a long and complicated, multi-sided civil war."

Shadin Alfadil huddled in her apartment over the ensuing days as shots continued to be fired outside and artillery and fighter jets turned buildings into rubble. The life story she has to tell is one that is closely tied to her country's recent history. In telephone conversations, she spoke about her hopes for change, the myriad setbacks and her firm conviction to never give up.

A Victorious Revolution

Alfadil was there in December 2018, in her early 30s at the time, when thousands took to the streets to protest against Bashir. She didn't want to spend her whole life in an authoritarian country with rigid moral norms, oppressed by a violent leader. "We wanted to fight for freedom," she says. The protests went on for four months. Finally, on April 11, 2019, jubilation broke out and activists embraced each other on the streets when the military turned on Bashir and arrested him. "That was a moment of hope," Alfadil says. "I believed in a better Sudan." But the euphoria didn't last long. The military showed no interest in relinquishing power.

Two generals are now determining the country's fate: Burhan and Hemeti. But the power struggle currently plunging the country into chaos began taking shape behind the scenes quite some time ago. Many observers already saw Hemeti as the country's true strongman back in 2019.

His career as a brutal commander began in 2003, during the rebellion in Darfur, which saw African-descended groups there rise up against the Arab-dominated government in Khartoum. Dictator Bashir mobilized Arab youth to put down the uprising, which led to the emergence of the notorious Janjaweed militias. Hemeti became one of their most important commanders.

During the first, particularly brutal, years of the war in Darfur, several hundred thousand civilians were killed and more than 2 million people displaced. Hemeti's Janjaweed rode into villages, slaughtered the inhabitants, raped the women, robbed and looted. The International Criminal Court later issued an arrest warrant against Bashir in connection with these crimes, including genocide.

Looting, Murders and Mass Rapes

Hemeti acted brutally, but more than anything else, loyally. Bashir thus put him in charge of the newly established Rapid Support Forces (RSF) in 2013, and Hemeti took many of his old fighters with him to the new unit. The RSF went on to commit looting, murder and mass rape in a number of regions in the country. Bashir had created an uncontrollable monster.

The dictator transformed the troops into a kind of bodyguard to protect him from protests – even more importantly, though, from coup attempts by the army. Alongside the army and the intelligence service, the RSF became a third power within the Sudanese security apparatus. When revolution swept the country in 2018, Hemeti used it to his advantage, abandoning his loyalty to the dictator and baking his ouster.

When the protests continued even after Bashir's overthrow, Burhan and Hemeti finally agreed to a compromise and created a transitional council. They promised change, but activist Alfadil and her fellow campaigners didn't trust them. The protesters once again took to the streets. Hemeti quickly showed his true face. On June 3, 2019, RSF units burned down protesters' tents, shot indiscriminately into the crowd and beat up participants. More than 100 people died, with many bodies simply being thrown into the Nile River. "I was also attacked," Alfadil says. "But we didn't give up. We had to prevail with the revolution."

After months of negotiations, a council was again formed, this time called the Sovereign Council, staffed half by civilians and half by the military. Free elections were to finally to be held at the end of this transition.

A State within the State

From the beginning, though, the military part of the newly created transitional government showed little interest in actually pursuing reform: The generals were afraid of losing their power – and their access to money. Because in Sudan, the army is basically a state within the state: High-ranking military officers are often firmly established in the business world and they rake in huge amounts of money thanks to widespread corruption. Among his business interests, for example, Hemeti works together with mercenaries of Russia's Wagner Group at his gold mines.

What followed were ups and downs, a tug-of-war for power, until, on October 25, 2021, the army and the RSF staged another coup and dissolved the interim government. They were still working side by side at the time.

The old familiar pattern quickly reestablished itself: Shadin Alfadil and her fellow campaigners took to the streets, and again people died. In the end, the generals again promised a transition to civilian rule.

But in the first months of this year, tensions between the two men increased. Hemeti sought to present himself as a true supporter of democracy and the possible next leader of Sudan and forged an alliance with a coalition of civilian political parties. But Burhan apparently feared Hemeti's growing power. When the RSF moved more units into Khartoum last week, it was apparently one provocation too many.

A Humanitarian Disaster

On Tuesday, the fourth day of the war, the situation for Shadin Alfadil grew increasingly fraught. She lives alone, and her concerns began mounting. What do I do if I get caught up in it? If a bullet hits me? How long will it take before someone finds me? The power went out for hours. It was becoming increasingly clear that a humanitarian catastrophe was developing. The World Food Program has suspended its operations after three of its staff members were killed. Looting took place at the warehouses of other humanitarian organizations. Even before the conflict, more than a third of the population had been dependent on aid.

On Tuesday evening, even though a time had been agreed for DER SPIEGEL to speak to her by phone, Alfadil could no longer be reached. A cease-fire was supposedly in place to enable people to flee or obtain basic necessities, but the fighting continued unabated, and in some parts of the city, it is growing even fiercer.

Eyewitnesses have shared accounts of bodies in the streets that haven't been recovered for days, of the stench of decay, of looting RSF units.

Holding Doctors Against Their Will

Various medical organizations have reported that most hospitals are no longer in operation and that the health-care system in Khartoum is on the verge of collapse.

Some hospitals have been bombed, reports doctor Sara Mohamed, while others lack medical staff. In addition, the doctors' committee made a serious mistake, publishing the names of hospitals that were still in operation. "Shortly after that, the RSF deployed and occupied them because they didn't know how else to take care of their wounded," Mohamed says. She says a doctor friend had just managed to escape, but others were still being held.

The situation is terrible, she says. "There are no words for it. I don't know if I will ever see my family again."

On Wednesday morning, activist Alfadil finally wrote a message, apologizing for her silence. She says she sufferred a mental breakdown. Two hours later, we held a phone call, but it lasted only two minutes and 20 seconds. Her voice sounded different than it had in the previous days - filled with fear. "I can only stay on for a second," she says, "we have to escape." She said a projectile had landed in her yard and exploded, instantly killing the gardener, the guard and one of her friends. "It's so random, there are no targets here," Alfadil says.

Fleeing Khartoum

She takes her sister and her sister's mother-in-law with her, and they drove two hours south, out of Khartoum, through the fighting. But as they guided themselves to safety, fearing for their lives, other activists were already beginning to organize again. They created WhatsApp groups where people needing help can put in requests, and help is then organized for them.

Videos are circulating on Facebook showing activists spray-painting walls with antiwar graffiti. Fighting can be heard in the background. Men singing songs against military rule. The civilian resistance is back in action. Shadin Alfadil is certain: She, too, will join the protests on the streets again. "Whoever wins this war threatens to become Sudan's new dictator," she says. "And one thing is clear to us: We will never accept a dictator again. Never!"

But experts are critical. Alan Boswell, responsible for the Horn of Africa at the International Crisis Group think tank, says: "It's the absolute nightmare scenario for the transition to democracy." Boswell says the intention of the two sides at the moment is clear: "They want to resolve the conflict militarily." But Boswell believes it is highly unlikely that either side can win the war.

It seems just as unlikely, though, that they will be able to find a compromise. The two sides are also fighting each other in the crisis-ridden region of Darfur. Experts are closely watching the escalation there with great concern. "Darfur is going to become a world of hurt. We'll probably see huge devastation and really scary amounts of potential carnage there, which is where Hemeti's stronghold is," Boswell says. The potential for terrible bloodshed, he adds, is high.

Alfadil finally arrived in the southern part of the country on Wednesday night after making her way by car through the fighting. On Thursday morning, she sent two short messages on WhatsApp: "super exhausted," followed by, "It's very safe here." No shots and no bombs. It's a calm that should be prevailing across the country following agreement on a third cease-fire, but in Khartoum, it hasn't held once again. Alfadil is tired. She has no idea what to do next. She does know one thing, though: Giving up isn't an option.

*With additional reporting by Mohamed Alamin

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Image: The NSO Group, the manufacturer of Pegasus spyware, is housed in a few top floors of this building complex in Israel.Credit...Amit Elkayam for The New York Times/ Editing by Germán & Co

How Mexico Became the Biggest User of the World’s Most Notorious Spy Tool

A Times investigation reveals the story behind how Mexico became the first and most prolific user of Pegasus. It’s still using it, despite promising to stop.

NYT By Natalie Kitroeff and Ronen Bergman, Natalie Kitroeff reported this article from Mexico City, and Ronen Bergman from Tel Aviv. April 18, 2023

The Israelis had come to Mexico to clinch a major sale: The Mexican military was about to become the first client ever to buy their product, the world’s most advanced spyware.

But before they could close the deal, an argument erupted over price and how quickly the spy tool could be delivered. A Mexican general overseeing the negotiations called for a pause until later that evening, according to two people present and a third with knowledge of the talks.

“We’ll pick you up at your hotel and make sure to arrange a better atmosphere,” they recalled the general saying.

That night, a convoy of cars arrived at the Israeli executives’ hotel and took them to a new spot for the fateful negotiations: a strip club in the heart of Mexico City.

The general’s security team ordered all the other clientele to leave the club, the three people said, and the talks resumed.

It was in that dark cabaret in March 2011, among women dancing onstage and shots of tequila, that the most powerful cyberweapon in existence got its start.

The spyware, known as Pegasus, has since become a global byword for the chilling reach of state surveillance, a tool used by governments from Europe to the Middle East to hack into thousands of cellphones.

No place has had more experience with the promise and the peril of the technology than Mexico, the country that inaugurated its spread around the globe.

A New York Times investigation based on interviews, documents and forensic tests of hacked phones shows the secret dealings that led Mexico to become Pegasus’ first client, and reveals that the country grew into the most prolific user of the world’s most infamous spyware.

Mexico went on to wield the surveillance tool against civilians who stand up to the state — abuses the country insists it has stopped. But The Times found that Mexico has continued to use Pegasus to spy on people who defend human rights, even in recent months.

Many tools can infiltrate your digital life, but Pegasus is exceptionally potent. It can infect your phone without any sign of intrusion and extract everything on it — every email, text message, photo, calendar appointment — while monitoring everything you do with it, in real time.

It can record every keystroke, even when you’re using encrypted applications, and watch through your phone’s camera or listen through its microphone, even if your phone appears to be turned off.

It has been used to fight crime, helping to break up child-abuse rings and arrest notorious figures like Joaquín Guzmán Loera, the drug lord known as El Chapo.

But it has also been deployed illegally, again and again, with governments using Pegasus to spy on and stifle human rights defenders, democracy advocates, journalists and other citizens who challenge corruption and abuse.

Alarmed at how Pegasus has been used to “maliciously target” dissidents across the globe, the Biden administration in 2021 blacklisted NSO Group, the Israeli company that manufactures the spyware.

Soon after, Israel’s defense ministry — which must approve the export of Pegasus to other nations — said it would ban sales to countries where there was a risk of human rights violations.

Yet, despite ample evidence of Pegasus abuses in Mexico, the Israeli government has not ordered an end to its use in Mexico, according to four people with knowledge of the contracts for the technology.

In fact, Mexico’s military is not only Pegasus’ longest-running client, the four people say, but it has also targeted more cellphones with the spyware than any other government agency in the world.

And the spy tool continues to be deployed in the country, not just to combat crime.

After the revelations that Pegasus had been wielded against government critics tarred his predecessor, President Andrés Manuel López Obrador, who came to office in 2018, promised to stop what he called the “illegal” spying of the past.

He did not. Previously undisclosed tests show that, as recently as the second half of 2022, Pegasus infiltrated the cellphones of two of the country’s leading human rights defenders, who provide legal representation to the victims of one of the most notorious mass disappearances in Mexican history.

A military patrol last year in Michoacan, Mexico. The Mexican military has used spyware to track down leaders of drug cartels, but has also used it to spy on human rights defenders, a Times investigation found.Credit...Daniel Berehulak for The New York Times

The military has a history of human rights abuses, and its role in the mass disappearance has been a focus of the investigation for years. As new allegations against the military surfaced in the case last year, the two advocates were targeted by Pegasus repeatedly, according to forensic testing conducted by Citizen Lab, a watchdog group based at the University of Toronto.

The Mexican military is the only entity in the country currently operating Pegasus, the four people familiar with the contracts said.

The Israeli defense ministry declined requests for comment. The Mexican defense ministry would not discuss the recent hack but said it followed the government’s position, which asserts that intelligence gathering is “in no way aimed” at invading the private life of political, civic and media figures.

This was the second wave of attacks on the phone of Santiago Aguirre, one of the human rights defenders. He had been targeted with Pegasus during the previous administration, too, Citizen Lab found.

“This government made so many promises that things would be different,” Mr. Aguirre said. “Our first reaction was to say, ‘This can’t be happening again.’”

A spokesman for the Mexican president declined to comment. In a statement, NSO Group said it “adheres to strict regulation and cannot disclose the identity of its customers.” The company challenged the conclusiveness of Citizen Lab’s forensic analyses, while Citizen Lab said it had no doubts about its findings.

To verify whether Pegasus hacked the two Mexican human rights advocates in recent months, NSO Group said it would need to be “given access to the data.” But the advocates said they were not willing to give the government’s spying partner any more of their private information.

Pegasus’ beginnings in Mexico have long been shrouded in secrecy. After the night at the strip club, the Israeli executives of NSO Group, then a fledgling start-up, returned to Tel Aviv with the outlines of their first sale. The next step was an actual contract.

So, a few months later, a team of NSO representatives returned to Mexico to show off the spyware to some of the most powerful people in the country.

On May 25, 2011, Eran Reshef, an Israeli defense industry executive who helped broker the deal, said in an email to NSO’s chairman and its two founders that “the demo to the Secretary of Defense and President will take place next Friday,” referring to the president at the time, Felipe Calderón, and his secretary of defense, Guillermo Galván Galván. A copy of the email surfaced in an Israeli lawsuit over commissions from the sale of Pegasus to Mexico.

Two of the people at the demonstration said it had taken place on a sprawling military base on the outskirts of Mexico City, where the first Pegasus machine would be installed.

Fearing leaks, the Mexican Army made the Israeli executives wait in a tiny room where cleaning supplies were kept so no one would see them before they made their presentation. An armed soldier was stationed outside the door.

When Mr. Calderón and Mr. Galván Galván arrived, they sat in front of large screens on the wall — and watched a phone get hacked, the attendees said.

Udi Doenyas, the chief technology officer of NSO Group who invented the Pegasus architecture and led the team that wrote the code behind the first version of the spyware, confirmed that he had connected the Pegasus system to a screen and handed a BlackBerry phone to senior Mexican officials. He asked them to use it.

As they did, the phone showed no signs of being compromised, but the Pegasus system methodically began extracting every piece of data, beaming it onto the screen for all to see.

This was the spyware’s superpower: the sneak attack.

Miguel Ángel Sosa, a spokesman for Mr. Calderón, acknowledged that the former president had paid a visit to a military facility, where he was “given various presentations about the tasks” being carried out, “including the gathering of information and intelligence.”

But he said Mr. Calderón was never informed whether the spyware was eventually purchased, and that the former president was never told — “nor did he inquire” — what tools were used to capture criminals.

At the time, Mexico desperately needed a way to reliably crack into BlackBerry phones, a device of choice for the nation’s fearsome drug cartels. From the start of his term in 2006, Mr. Calderón had pushed a so-called kingpin strategy for confronting organized crime, focusing on the groups’ top leaders.

Pinpointing the drug lords required technology that allowed spies to follow their location constantly. The criminals were careful, former law enforcement officials said, moving around and shutting down their phones to avoid being captured.

“It didn’t give you enough time to launch an operation,” said Guillermo Valdés, the former director of CISEN, which was the country’s equivalent of the C.I.A., from 2007 to 2011. “If someone turned off his phone, we no longer knew where he was.”

Up to that point, Mexico had relied heavily on the United States.

“The pressure on the military to raise its game in terms of intelligence capabilities was intense,” said Alejandro Hope, a former intelligence officer during the Calderón administration. A potential draw of Pegasus, he said, is that it would give Mexico its own capabilities.

“They no longer wanted to be dependent on the Americans,” Mr. Hope said.

The military signed the contract to buy the spyware soon after the demonstration.

In September 2011, about 30 NSO employees, most of the company’s staff, flew to Mexico to set up Pegasus, test it and instruct a team of about 30 Mexican soldiers and officers how to operate the technology, according to three people familiar with the installation. The Mexican unit chosen to operate it was called the Military Intelligence Center, a secretive arm of the army about which little has been made public.

Once the Mexicans were ready to run Pegasus on their own, a short ceremony took place that December as a way of “handing over the keys,” two of the people said.

A document from 2019, unearthed in an enormous hack of Mexican military emails last year, indicates that the Mexican intelligence center is housed in a horseshoe-shape complex. Three people familiar with it say commanders can watch through internal glass walls as information unspools on huge screens.

In a 2021 document, also made public by the hack, the army says that one of the main risks facing the center is “that the activities carried out by this center are revealed to the public.”

Pegasus was quickly embraced by the Mexican authorities, and after Enrique Peña Nieto took office as president in 2012, two more government agencies bought it: the attorney general’s office and CISEN, according to Mexican officials and three people with knowledge of the contracts.

Within a few years, the spyware began infiltrating the phones of some of Mexico’s most prominent human rights lawyers, journalists and anti-corruption activists — surveillance that strayed far from the agreement with the Israelis to target serious crime and terrorism.

Condemnation came swiftly from at home and abroad, and the scandal clung to Mr. Peña Nieto for the rest of his presidency. In all, Mexico has spent more than $60 million on Pegasus, according to Mexican officials, citing spending by past administrations.

The Mexican military has acknowledged having Pegasus only from 2011 to 2013. But a group of independent experts investigating the disappearance of 43 students who were planning to attend a protest said the military had Pegasus when they were abducted in 2014, and was spying on the phones of people involved in the crime on the night the events unfolded.

It is not clear why the military was spying, but the intelligence was not used to help find the students, the experts said.

After Mr. López Obrador took office in 2018, he dissolved the federal police and replaced the Mexican spy agency with a new entity.

From 2019 through today, only the military has had Pegasus, four people with knowledge of the contracts say. And during that time, the spyware has continued to be deployed against journalists, human rights defenders and an opposition politician, according to Citizen Lab’s analyses.

Under Mexican law, government entities need a judge’s authorization to spy on private communications. But in public disclosures, the military has said it has not made any request to do that kind of surveillance in recent years.

On a Thursday afternoon last December, Mr. Aguirre got an email that read like something out of a spy novel.

“Apple believes you are being targeted by state-sponsored attackers who are trying to remotely compromise the iPhone associated with your Apple ID,” said the message, which was reviewed by The Times. “These attackers are likely targeting you individually because of who you are or what you do.”

In 2021, Apple announced it would begin sending warnings like this to users whose cellphones had been hacked by sophisticated spyware. The email went on to say that “sensitive data” on Mr. Aguirre’s phone may be compromised, “even the camera and microphone.”

Mr. Aguirre, the executive director of the Miguel Agustín Pro Juárez Human Rights Center, had been targeted years earlier with Pegasus.

His stomach sank thinking of government spies poring over his entire digital life, from messages with torture survivors to family photos with his young daughter.

Then it hit him: Others might be compromised, too.

He ran down the hall to the office of María Luisa Aguilar, the lead advocate handling the group’s international work. She had gotten the same email.

The two advocates contacted the Mexican digital rights group known as R3D, which had their phone data analyzed by Citizen Lab. It confirmed that both were hacked multiple times by Pegasus from June through September 2022.

“In the eyes of the armed forces, we represent a risk,” Ms. Aguilar said. “They don’t want to lose the power they have accumulated.”

*Natalie Kitroeff reported from Mexico City, and Ronen Bergman from Tel Aviv. Natalie Kitroeff is The Times’s bureau chief for Mexico, Central America and the Caribbean. @Nataliekitro

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