The European Commission “will relax state-aid rules to support investment in green sectors” in response to the $369bn US Inflation Reduction Act (IRA), the Financial Times reports. According to a draft proposal seen by the newspaper, the European Commission would “relax state-aid rules to support investment in green sectors”, while some of a €800bn Covid-19 recovery fund could be redirected towards tax credits. The paper continues: “By further relaxing the EU’s state-aid rulebook, which aims to avoid a subsidy race between member states, Brussels is attempting to emulate one of the most-vaunted benefits of the IRA, namely the simplicity of companies accessing federal tax credits.” Reuters reports that the proposal would “produce a simpler regulatory framework for manufacturers of technologies deemed key to meeting the EU’s climate change goals, including faster permitting procedures”. It continues: “Specific projects considered important to developing clean technology supply chains could also receive speedier permits, said the draft, which could still change before it is published. Potential options include batteries, carbon capture and storage, renewable energy, renewable hydrogen, energy storage, and low-carbon construction technologies, although the EU will assess which projects to make eligible, the draft said. The EU would also set goals to expand these industries by 2030, to ensure they keep up with Europe’s growing needs for clean energy and products.” Separately, Reuters says the EU will not propose any new borrowing to support Europe’s green industry. Meanwhile, Bloomberg notes that “some member states have expressed concerns that the EU plan could unfairly benefit wealthier countries that have more fiscal capacity”. The draft – called the “Green Deal Industrial Plan” – will warn of “unfair” Chinese subsidies, stating that “Europe and its partners must do more to combat the effect of these unfair subsidies and prolonged market distortion”, Reuters says. The Guardian notes that European policymakers have been “under pressure” to respond to the IRA, which encourages investment in renewables. And Reuters reports that the head of an EU-linked critical materials agency said the EU “must use upcoming legislation to speed up permitting and encourage investment in projects such as rare earths”.

Meanwhile, the Financial Times carries a warning from business leaders and politicians that “the UK push into emerging green industries including hydrogen, carbon capture, batteries and floating wind turbines is under threat as the US and EU boost incentives for domestic green technologies”. Similarly, the Daily Telegraph says British  chancellor Jeremy Hunt has been “warned” that “Britain’s electric car market risks being left behind as the EU ramps up a transatlantic subsidies war with the US”.

In other European news, EurActiv reports on a leaked draft of the new EU biodiversity plan, which reveals that the bloc could ban bottom trawling in marine protected areas by 2030. Climate Homes News adds that the “EU Action Plan to protect and restore marine ecosystems for sustainable and resilient fisheries” is expected to be released in the first quarter of 2023 by the European Commission. Meanwhile, Reuters reports that the EU “has appointed gas capacity platform Prisma to calculate countries’ collective demand for gas, as the bloc moves ahead with a plan to launch joint gas buying among EU countries”. 

Elsewhere, EnergyMonitor covers Ember’s European Electricity Review 2023, published today. The analysis finds that “while the share of coal-fired power generation increased in EU countries last year, it did so by much less than some expected”. Reuters adds: “Ember said the return to the most polluting fossil fuel ‘could have been much worse’. Increased generation from wind and solar, plus an overall drop in EU power use amid mild weather and as consumers struggled with high prices, prevented a bigger coal rebound, it said.” Carbon Brief coverage of the report finds that wind and solar supplied more of the EU’s electricity than any other power source for the first time ever in 2022 – providing a record one-fifth of the EU’s electricity in 2022.

New research using artificial intelligence finds that humanity has a 50% chance of breaching the 2C warming target by mid-century, the Guardian reports. The paper says: “Utilising a neural network, or a type of AI that recognizes relationships in vast sets of data, the scientists trained the system to analyse a wide array of global climate model simulations and then asked it to determine timelines for given temperature thresholds. The model found a nearly 70% chance that the 2C threshold would be crossed between 2044 and 2065, even if emissions rapidly decline.” The new projections are “more pessimistic than previous modelling”, the Associated Press reports. For example, it says that in a low-emissions scenario, the AI projects 2C warming around 2050. Meanwhile, the Intergovernmental Panel on Climate Change estimates that in this scenario, the planet would not hit 2C warming until the 2090s. Axios also covers the study.

In other new research, the Financial Times reports that the most polluting 10% of people are responsible for almost half of the annual greenhouse gas emissions behind climate change. The Guardian adds that, according to new data, “the difference between the carbon emissions of the rich and the poor within a country is now greater than the differences in emissions between countries”.

A new report by the Confederation of British Industry, commissioned by the Energy and Climate Intelligence Unit, finds that the transition to a greener economy “is worth £71bn”, and has brought jobs and investment to parts of the UK experiencing industrial decline, BBC News reports. According to the outlet, the CBI finds that “the drive to reach net-zero emissions involves more than 20,000 businesses”, while some 840,000 jobs are linked to sectors ranging from renewable energy to waste management. It adds that green jobs “pay significantly more” – with an average wage of £42,600, compared to the national average of £33,400. The Times adds: “​​The report also found that such jobs are unusually productive, generating £112,300 in gross value added – a measure of their contribution to the economy – per employee, 1.7 times higher than the national average of £64,400.”

The UK government has released its “long-awaited” environmental improvement plan, the Guardian reports. The plan includes commitments to restore at least 500,000 hectares of wildlife habitat and 400 miles of river, so every household will be within 15 minutes of green space of water, the paper says. It adds that a new species survival fund will target some of the most threatened wildlife and that sewage spills will be tackled. “From November every government department will also have an obligation to consider the environmental and climate impacts of each new policy and piece of legislation,” the newspaper says. It adds: “The environmental improvement plan (EIP) is required under the Environment Act, and is meant to translate into policy the commitment made in the 25-year Environmental Plan, set out in 2018, to ‘improve the environment within a generation and leave it in a better state than we found it.’” However, BBC News reports that earlier this month, the Office for Environmental Protection warned that the government’s efforts were falling “far short” of what was needed, leaving country facing a “deeply concerning decline in biodiversity”. Reuters also covers the new plan.

Separate analysis by the Guardian says that farmers “will be key” to the new plans. It continues: “Some of the farming-related pledges include a commitment that 65% to 80% of landowners and farmers will adopt nature-friendly farming practices on at least 10 to 15% of their land by 2030…These policies will be supported through the new farming payments scheme, the details of which were announced last week. Though it has been simplified, and more ways to get paid by the government to protect nature have been added, some farmers think that the costs of changing the way they farm may outweigh what they are paid under the scheme, which is due to replace the EU’s area-based payments system. It remains to be seen whether the new scheme will be a success.”

In other UK news, the Independent covers analysis from One Home, which finds that £600m of homes in England could be lost to sea by the year 2100 as a result of coastal erosion. The paper maps the 21 villages and hamlets in England that are facing the greatest risk. Separately, the paper has published a piece on the mental health consequences of living so close to the sea. Sky News also covers the analysis.

A “robust rebound” in Chinese travel over the Lunar New Year holiday earlier this month has “boosted optimism in the outlook for oil demand”, says Bloomberg. It adds that gasoline and jet fuel consumption “jumped” during the week-long break as people “took the opportunity to travel after the nation dismantled its restrictive Covid Zero policy last month”. Another Bloomberg article writes that China’s economy “showed a few signs of improvement” in January as the country “charted a path through its second month without Covid Zero curbs, though a major holiday season kept a lid on some activity”.

Meanwhile, an NPR article in the US quotes Nargiza Salidjanova, a China director at the research firm Rhodium Group, who says that “China-watchers are still waiting to see more substantial pro-business policy changes, such as giving private and foreign firms equal access in technology and certain industrial sectors and reducing tariffs on imported goods”. The state-run newspaper Global Times says that China has been “shrugging off the clouds” posted by the epidemic and is now “firing on all cylinders in 2023, a momentum which economists said is underpinned by the country’s three-year dynamic Covid response that has proven to have maximised social economic benefits with minimum costs”. The Financial Times quotes He Tianyu, an analyst at commodity consultancy CRU, saying that “the real-estate recovery, the push to deliver unfinished homes, renewable energy and new energy [electric] vehicles [in China] are still the main drives for copper”.

In other news, Reuters has a comment piece by columnist Clyde Russell, titled: “Asia thermal coal prices slip as China, India buy less.” Bloomberg carries a comment piece by columnist Javier Blas, titled: “Putin’s oil makes a stop off Spain en route to China.” Finally, Project Syndicate runs a comment piece by Andrew Sheng, a distinguished fellow at the Asia Global Institute at the University of Hong Kong, and Xiao Geng, chairman of the Hong Kong Institution for International Finance. They write: “Unless the world’s leading powers credibly commit to a more cooperative and inclusive future, we may find ourselves living in an irrevocably divided world, roiled by climate change, and hurtling toward global conflict.”

In 99% of cases, it is more expensive to keep coal-fired power plants in the US running than to build an entirely new solar or wind energy operation nearby, according to new research covered by the Guardian. The newspaper continues: “[The analysis] compared the fuel, running and maintenance cost of America’s coal fleet with the building of new solar or wind from scratch in the same utility region. On average, the marginal cost for the coal plants is $36 each megawatt hour, while new solar is about $24 each megawatt hour, or about a third cheaper. Only one coal plant – Dry Fork in Wyoming – is cost competitive with the new renewables.” The Hill adds: “Analysts also found that the savings from transitioning to locally produced solar energy could be used to add 137 gigawatts worth of batteries across all plants and at least 80% of the capacity at one in three existing coal plants. In other words, they wrote, ‘the economics of replacing coal with renewables are so favourable that they could fund a massive battery storage buildout to add reliability value along with emissions reductions.’” Inside Climate News says “the report joins prior editions in 2019 and 2021 that, when viewed together, show how the economics of coal power are deteriorating”. It adds: “The shift is due in large part to the Inflation Reduction Act, signed in August, which has several incentives that make wind and solar less expensive.”

In other news, the Financial Times reports that the new chief executive at Shell is planning to restructure the company, to “improve performance and bring the company’s low-carbon initiatives into a single division”. Bloomberg explains that the company “will combine its integrated gas and upstream divisions, and merge its downstream and renewables units”. Elsewhere, the Financial Times reports that “while other US oil fields are in decline, Permian production hit a record high last year as Russia’s invasion of Ukraine helped drive energy prices higher”. And the Daily Telegraph carries a warning from BP that “investment in oil and gas production will be needed for the next three decades if the world is to avoid more shortages and price swings”.

Climate scientist Prof Corinne Le Quéré has appeared on the BBC Radio 4 programme “Desert Island Discs”. Le Quéré outlines how her career in climate science began and shares her experience as the only woman in early meetings of the Intergovernmental Panel on Climate Change (IPCC).

In other UK comment, journalist Iain Dale has penned a comment piece in the Daily Telegraph, saying: “Don’t buy an electric car, even if you just want one for short journeys. I was one of many to jump on the electric bandwagon and purchase one of these vehicles. I recently decided to return it.” He continues: “ If you buy one popular electric SUV, you basically emit 12 tonnes of CO2 just through the manufacturing process. For smaller petrol models, the equivalent can be just 2 tonnes. And much of the electricity used to power electric cars doesn’t come from renewable sources, either.” (Carbon Brief has published a factcheck about these sorts of claims.) Elsewhere, Leo McKinstry has penned a fullpage comment piece in the Daily Mail under the heading: “Eco zealots are turning firms like BP and Shell into cultural pariahs – yet they’re the giants whose innovations can wean us off fossil fuels.” He writes that “there is also something unbalanced about the neurotic hostility towards oil companies, while giving a free pass to other businesses that could be portrayed as equally guilty” and calls for a “subtle, mature approach”. 

New research assesses potential pathways to net-zero emissions from global aviation. The authors find that “ambitious” reductions in demand for air transport and improvements in the energy efficiency of aircraft might avoid up to 61% and 27%, respectively, of projected business-as-usual aviation emissions in 2050. However, they add, “further reductions will depend on replacing fossil jet fuel with large quantities of net-zero emissions biofuels or synthetic fuels…which may be substantially more expensive”. In addition, carbon “may need to be removed from the atmosphere to compensate for non-CO2 forcing for the sector to achieve net-zero radiative forcing”, the study says.