California May Lose $2.7 Billion This Year Due To The Drought

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The historic drought plaguing California has done more than close golf coursesand incite a nationwide debate about almonds — it could result in a $2.7 billion dollar hit to the state’s economy from agricultural losses, according to research released earlier this week by the University of California, Davis.

Although the economic cost is nearly half a billion more than last year, it’s still a relatively small drop in California’s massive economy — agriculture, despite claiming a great deal of the state’s water, accounts for only about 2 percent of its overall gross domestic product. The total expected loss to California’s agricultural economy — worth $45 billion — is just 6 percent.

“The 2015 drought is not as severe as initially anticipated, but worse than 2014 in terms of reduced water availability and economic impact to agriculture,” the researchers wrote in an analysis to the California Department of Agriculture on May 31. For the most part, researchers found, farmers have been able to supplement water cuts by pumping groundwater, buffering losses from crop fallowing, and curbing employment losses.

 Still, some 564,000 acres are estimated to be left unplanted this year due to the drought, a 33 percent increase over 2014 that will result in the loss of approximately 18,600 full-time, part-time, and seasonal jobs. That’s a 9 percent increase from last year, when the drought claimed 17,100 jobs.

To avoid large economic losses, California farmers are beginning to shift production of certain crops to areas where water is more readily available.Tomatoes, for instance, are being grown more and more in the northern parts of the state, where water shortages are less of an issue than in the state’s more arid southern half.

Farmers have also taken a historic step in offering to voluntarily curb their water use. Recently, water rights holders whose property directly touches a water source in the Sacramento-San Joaquin River Delta agreed to curb their water use by 25 percent. In exchange for that voluntary cut, the State Water Board has agreed not to impose other cuts later in the growing season.

It’s unclear how much of a difference the move will make, however, as the area impacted by the agreement accounts for less than 10 percent of California’s agricultural land.

On Tuesday, during a Senate Energy and Natural Resources Committee hearing about the current conditions in the West, Sen. Maria Cantwell (D-WA) called for a greater understanding of how climate change would impact drought in the future, highlighting the potential economic impact agricultural losses could have nationwide. She noted that her state’s drought is causing water shortages in the Yakima Basin, Washington’s most productive agricultural region. Crop losses there are expected to cost the state $1.2 billion in 2015.

“We need to develop bold, innovative, 21st century strategies for water management that not only respond to drought conditions today, but also prepare us for an uncertain future,” Cantwell said. “This requires new ways of thinking and collaborating, and not just incremental changes at this point in time.”

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Shell accused of strategy risking catastrophic climate change

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Royal Dutch Shell has been accused of pursuing a strategy that would lead to potentially catastrophic climate change after an internal document acknowledged a global temperature rise of 4C, twice the level considered safe for the planet. A paper used for guiding future business planning at the Anglo-Dutch multinational assumes that carbon dioxide emissions will fail to limit temperature increases to 2C, the internationally agreed threshold to prevent widespread flooding, famine and desertification.

The revelations come ahead of the annual general meeting of Shell shareholders in the Netherlands on Tuesday, where the group has accepted a shareholder resolution demanding more transparency about the group’s impact on climate change.

Hundreds of environmentalists took to the seas off Seattle in kayaks, canoes and paddleboards on Sunday to protest against the company’s’s controversial plans to drill in the Arctic Ocean. The “Shell No” protest was held close to where Shell’s Polar Pioneer drilling rig is docked. One banner read: “We can’t burn all the oil on the planet and still live on it.”

Ben van Beurden, the Shell chief executive, has repeatedly stated that the fossil fuel giant is a responsible company that fully accepts the need to counter manmade global warming, has campaigned for a tax on greenhouse gas emissions, and is moving its focus from oil to cleaner fuels such as gas.

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But an analysis of Shell’s New Lens planning document points to an acceptance that world temperatures will rise to a level that the Intergovernmental Panel on Climate Change argues would have a severe and widespread impact. A 4C global rise by 2100 would entail a sea level rise of between 52cm and 98cm, leading to widespread coastal flooding. There would be widespread risk of animal and plant extinctions and global agriculture would be severely hit. A 4C average would also mask more severe local impacts: the Arctic and western and southern Africa could experience warming up to 10C.

The Shell document says: “Both our (oceans and mountains) scenarios and the IEA New Policies scenario (and our base case energy demand and outlook) do not limit emissions to be consistent with the back-calculated 450 parts per million (Co2 in the atmosphere) 2 degrees C.”

It adds: “We also do not see governments taking steps now that are consistent with 2 degrees C scenario.”

Environmentalists said the presumptions undermine Shell’s ability to talk with authority on climate change.

Charlie Kronick, climate campaigner at campaign group Greenpeace, said Shell and IEA saw fossil fuels continuing to be burned, with the earth facing temperature rises of 3.7°C or 4°C in the short term, mounting to 6°C later on.

“What I don’t see is a realisation from Shell about what exactly would happen to its business if climate change escalated dramatically beyond what is safe with all the negative consequences in the world for food and water never mind energy,” said Kronick.

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Louise Rouse, an investor relations specialist and consultant to Greenpeace, said the New Lens document undermined Shell’s claim that ongoing oil and gas exploration helps raise living standards in the developing world by supplying the energy for rapidly expanding economies.

“There is an incoherence at best between oil companies on the one hand positioning themselves as being on the side of the world’s developing countries and while on the other actively pursuing strategies which will entail catastrophic climate change which we already know is having a significant impact on the global south,” she said.

Friends of the Earth in the Netherlands, which has carried out its own review of activities by the Anglo-Dutch oil group, said the company often argues that it is moving away from oil towards cleaner gas but has often concentrated on the most carbon intensive forms of gas such as liquefied natural gas. Shell’s carbon dioxide emissions have risen in 2014 and are set to increase further as it expands the business through a planned £47bn takeover of rival BG.

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Shell declined to comment formally on the New Lens scenarios but oil industry experts said they were not meant to be a business blueprint. Instead, they represent “plausible assumptions and quantification” designed to make executives consider events that may be only remotely possible. The expert added: “Scenarios are not intended to be predictions of likely future events or outcomes.”

The Guardian’s Keep it in the Ground campaign seeks to persuade the Wellcome Trust and the Gates Foundation to divest themselves of their shareholdings in fossil fuel companies. According to the latest figures, Wellcome held a stake of £142m in Shell as of September 2014. The Gates Foundation held £6m of Shell’s shares at the time of its latest tax filing in 2013.

The Anglo-Dutch group said the BG takeover would expand its presence in controversial deep-water activities – many of the planet’s untapped fossil fuel resources are now in ocean regions that are difficult to access – but said it would also increase its presence in liquefied natural gas, a cleaner fossil fuel than oil.

It added: “By combining BG’s portfolio and skills set with Shell’s capabilities, we can deliver a step change in the growth priorities for both of our companies. This means more deep water and more LNG, plays where we have strong profitability and capabilities.”

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An excerpt from ‘The Guardian’ article written by Terry Macalister, 17 May 2015

Top EU companies urge drastic cuts in greenhouse gas emissions

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By Alister Doyle and Geert De Clercq

PARIS, May 21 (Reuters) – Top European companies urged governments on Thursday to set a goal of slashing greenhouse gas emissions to net zero well before 2100, saying that going green can bring profits rather than costs.

Business leaders from global and European alliances of companies including Unilever, Total and Saint-Gobain also called for a global price on carbon emissions and a phase-out of fossil fuel subsidies.

“We want a global climate deal that achieves net zero emissions – make it happen,” they said in a statement directed at almost 200 governments which are due to agree a deal to slow global warming at a summit in Paris from Nov. 30 to Dec. 11.

Net zero emissions would mean drastic cuts and imply any remaining emissions would be offset, for instance, by planting trees to soak up carbon dioxide or with yet-to-be-developed technologies to extract carbon from the air.

They said global emissions should peak around 2020 and reach net zero “well before the end of the century”.

Organisers of the conference, part of efforts to build momentum for a global deal after past failures, said the statement was backed by 25 business networks representing more than 6.5 million firms in more than 130 countries.

Still, the Business and Climate Summit mainly attracted top European CEOs, whereas large U.S and Asian companies were notably absent. The statement said businesses believed that a goal of net emissions was “achievable and compatible with continued economic growth.”

Cuts in emissions can help avert more droughts, floods and rising seas and have big benefits such as lowering air pollution that causes millions of deaths, especially in big emerging nations such as China and India.

“Business as usual is no longer possible,” said Pierre-Andre de Chalendar, CEO of French building materials group Saint Gobain.

U.N. Secretary-General Ban Ki-moon, who has urged more business involvement to help limit emissions, called the conference “an important milestone” on the way to the Paris summit.

Still, governments are sharply divided about whether to set a goal of net zero emissions at Paris. A report by the U.N. panel of climate scientists last year said net zero emissions by about 2070 would give a good chance of avoiding ever-more damaging warming.

“Three years ago you couldn’t get 50 CEOs to a conference on climate change,” said Paul Polman, CEO of Unilever. He said Climate change was an economic threat – a drought in Brazil, for instance, can cut hydro-electric output, shutting down industry.

He said he favoured a goal of net zero emissions by 2050. Such cuts are a radical shift from rises in almost all recent years.

Even Saudi Arabian Oil Minister Ali Al-Naimi said OPEC’s top producer was investing in solar power as it anticipates lower global reliance on fossil fuels.

“In Saudi Arabia, we recognise that eventually … we are not going to need fossil fuels. I don’t know when, in 2040, 2050 maybe,” he said.

(Additional reporting by Michel Rose and Jessica Chen; Editing by David Holmes and Ahmed Aboulenein)