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April 16th, 2008:

Farming Out The Pollution Problem

Apr 16th, 2008
by AdminCTA.
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Oasis’s promise of a Hong Kong-based budget airline turned out to be a mirage after all.

Wednesday, April 16, 2008 – The Standard

Oasis’s promise of a Hong Kong-based budget airline turned out to be a mirage after all. But capitalism proceeds from its failures as well as from its successes, and in spite of the considerable (and perhaps unavoidable) inconvenience and loss to people holding now worthless tickets, entrepreneurial derring-do and the risk that accompanies it is one of the foundations of Hong Kong’s prosperity.

Oasis’s demise may, in the end, be no bad thing, for while cheap flights have permitted many more people to take many more holidays, the consequent increase in air travel results in worsening carbon emissions and a variety of problems related to airport development: noise, pollution and congestion.

The unfortunate truth is that budget airlines like Oasis encourage people to fly, which would be fine if airplanes didn’t belch out carbon and pollutants in rather large amounts. But they do.

I don’t wish to wax overly moral about this, for I will take advantage of low-cost flights myself when available, but any solution to reduce carbon emissions from air travel will result in higher prices, so maybe we shouldn’t mourn too much for the passing of the HK$1,000 Hong Kong-London ticket.

Indeed, high oil prices have much the same effect as a carbon tax and may be the best (and perhaps only practical) way to reduce carbon emissions from air travel.

Admittedly, the revenues from this “tax” go to oil companies and some not-always-entirely-in-favor regimes around the world, rather than the supposedly more benign national tax authorities of the consuming countries, but they are no less effective for that.

Further, the woes of Heathrow’s Terminal 5 have once more raised arguments against concentrating all aviation growth in a single location: regardless of projected demand, there are considerable reservations about the wisdom of continued expansion there.

London has several airports in addition to Heathrow, including Gatwick, London City Airport, Stansted and Luton. Budget airlines tend to fly from the latter two: their business models are based on the lower costs at these secondary airports. New York also makes use of at least three airports, and Washington two.

Hong Kong’s equivalents would be Macau and Shenzhen. If there are to be budget carriers, perhaps it’s just as well that they fly out of our secondary airports – something which has already begun to happen – reducing the pressure to expand Chek Lap Kok.

Airports are capital-intensive and the return on investment often problematical. Anyway, what Hong Kong wants are the passengers: plane take-offs and landings are just a means to an end.

If Macau and Shenzhen get the congestion, noise and pollution, and we get the passengers, then so much the better. It is true that both Macau and Shenzhen are more inconvenient than Chek Lap Kok, but perhaps not much more so than Stansted, or the Girona and Reus airports used by budget airlines flying to Barcelona. If you are someone for whom money is more valuable than time, you’ll put up with an extra 30-60 minutes on the bus or ferry.

There is not, of course, immigration control between London and Stansted, but Geneva airport, for example, manages to accommodate passengers to and from both France and Switzerland, by having each country maintain its own immigration and customs, while British immigration for travelers on the Eurostar from Paris is at departure in the Gare du Nord.

The larger issue is that we can’t look at our relations with our regional neighbors exclusively as a zero-sum game where every visitor to, or via, Macau, for example, is one lost to Hong Kong. Neither Macau nor Shenzhen is a competitor for those visitors who want what Hong Kong has to offer.

Budget flights to these two places are likely to increase rather than decrease visitors here, or at least would if transit to Hong Kong could be streamlined.

Whether or not this will actually happen remains to be seen, but Oasis’s demise is a reminder that not all business activities which might benefit Hong Kong should necessarily be based here and that moving certain activities outside the confines of Hong Kong might allow us to concentrate on the higher value-added ends of the business.

China Surpasses US As Top Carbon Polluter: US Study

Apr 16th, 2008
by AdminCTA.
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Agence France-Presse in Los Angeles – Updated on Apr 16, 2008

China has already surpassed the United States as the world’s largest carbon polluter, the authors of a California study said Tuesday.

“Our best forecast has China’s CO2 (carbon dioxide) emissions correctly surpassing the United States in 2006 rather than 2020 as previously anticipated,” said the study by researchers at the University of California.

The report, written by economic professors Maximilian Aufhammer of UC Berkeley and Richard Carson of UC San Diego, is to be published next month in the Journal of Environmental Economics and Management.

Researchers compiled information about the use of fossil fuels in various Chinese provinces and forecast an 11 per cent annual growth of carbon emissions from 2004 to 2010.

Previous estimates had set the growth rate at 2.5 to five per cent.

The spike in air pollution by China has largely cancelled out efforts by other countries’ attempts to reduce greenhouse gas emissions in accordance with the Kyoto Protocol, the authors said.

The researchers predicted that by 2010, “there will be an increase of 600 million metric tons of carbon emissions in China over the country’s levels in 2000.”

That growth would “dramatically overshadow the 116 million metric tons of carbon emissions reductions pledged by all the developed countries in the Kyoto Protocol,” the report said.

“Put another way, the projected annual increase in China alone over the next several years is greater than the current emissions produced by either Great Britain or Germany.

The researchers studied pollution data from China’s 30 provincial entities in order to obtain a more precise snapshot of greenhouse gas emissions.

“Everybody had been treating China as single country, but each of the country’s provinces is larger than many European countries, both in geographic size and population,” said Carson.

“In addition, there is a wide range in economic development and wealth from one province to the next, as well as major differences in population growth, all of which has an effect on energy consumption that cannot be easily addressed in models based upon aggregate national data.”

Mr Aufhammer said the results showed the “emissions growth rate is surpassing our worst expectations, and that means the goal of stabilising atmospheric CO2 is going to be much, much harder to achieve.”

Mainland To Face Pressure At Meeting Of Big Polluters

Apr 16th, 2008
by AdminCTA.
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Stephen Chen – Updated on Apr 16, 2008

Leading greenhouse gas emitters will meet in Paris tomorrow to work out ways to tackle global warming, with the mainland expected to face unprecedented pressure to take the initiative.

The two-day meeting will be chaired by the US and preceded by a workshop today on greenhouse gas targets for industrial sectors.

The meeting is part of a drive for an agreement by the end of this year by countries that emit 80 per cent of the world’s greenhouse gases.

The Paris gathering is the third since US President George W. Bush initiated talks last year with major emitters, including the mainland, India and the European Union.

For China, battered by the Tibetan riots and a protest-riddled Olympic torch relay, the meeting would be like The Banquet, environmental observer Li Feng suggested, referring to a mainland movie involving a political setup.

Last month, economists at the University of California, Berkeley, and UC San Diego released a study on China’s carbon emissions with figures that put all previous estimates – including those by the Intergovernmental Panel on Climate Change – in the shade.

The researchers’ most conservative forecast said that by 2010, the annual carbon emissions in China would be 600 million tonnes higher than they were in 2000.

Given that developed countries have pledged only 116 million tonnes of carbon emissions cuts under the Kyoto Protocol, the growth from China would dramatically overshadow the world’s effort to tame global warming, the scientists said.

“Making China and other developing countries an integral part of any future climate agreement is now even more important,” Maximillian Auffhammer, UC Berkeley assistant professor of agricultural and resource economics, said in an earlier press release.

“It had been expected that the efficiency of China’s power generation would continue to improve as per capita income increased, slowing down the rate of carbon dioxide emissions growth.

“What we’re finding instead is that the emissions growth rate is surpassing our worst expectations.”

On Monday, the new Ministry of Environmental Protection – the elevated State Environmental Protection Administration – released the first batch of orders to control the emission of greenhouse gases, making China the first country in the world to issue compulsory standards on greenhouse emissions.