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Comment by nothrabannosir | Hacker News Reader

Norway sells most of their green energy and buys fossil fuel energy in return. 98% of their energy production is renewables, but only 9% of their consumption is. A solid 58% of their consumption comes from fossil fuels.

Source: Norway’s department of energy. https://www.nve.no/energiforsyning/varedeklarasjon/nasjonal-...

This isn’t just accounting pedantry: the countries they sell their renewables to use those, to (rightfully) claim green energy consumption. Norway then does the same, but based on their production.

Reminiscent of the expression “success has many parents, but failure is an orphan.”

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That's how it's supposed to work. A country like Norway producing 100% green energy and having 100% coal or other non-renewables on the books is the system working as designed.

It means that countries who actually use non-renewables to power their grid effectively subsidize the Norwegian energy market and pay a fine for their own use.

It's amazing how common the misconception that this is somehow nefarious is. I encourage you to read up on some of the published material about energy certificates, certificates of origin etc.

The issue isn’t green energy production and resale, but double counting of credits. Multiple players claiming “green energy” (leaving out whether it’s production or consumption), while none take responsibility for the fossil fuels.

Energy is fungible, meaning they only sell the credits and use the green power internally. Now suddenly they use originally “green” power, never mind that the credits have been sold and someone else is doing the same.

Google “Norway green energy” to get a feel for what it looks like in the media.

There is no need for them to sell many of those credits, as evidenced by the fact that they don’t even transfer much of that power. Don’t forget that they lower that penalty by increasing supply. If they went off the market, other, domestic players would get more money for their own production. And Norwegians are lulled into a false sense of green compliance, thereby being less incentivised to root for reduction of fossil fuel consumption.

It’s a great example for the expression “having your cake and eating it, too.” If you ever need to explain that one :)

Respectfully, you're continuing to entirely misunderstand how this works.

There isn't double-counting, that's the entire point of the system where "green" producers end up with "dirty" credits, because a "dirty" pays that "green" provider to take its credits in exchange, to prevent double counting.

But the notion of which sort of credit you buy and what sort of energy you actually produce are two separate things.

As an example Iceland is exempt from certain EU/EEA energy efficiency regulation because of its near-100% use of green energy, even though its power companies have something like >80% "dirty" energy credits on hand.

This is because the regulators can distinguish between a "dirty" power plant with 100% green credits on hand (i.e. they've subsidized a "green" power plant) v.s. a "green" power plant with 100% green credits on hand.

    > There is no need for them to sell
    > many of those credits, as evidenced
    > by the fact that they don’t even transfer
    > much of that power.

I think this is the crux of the issue and shows just how thoroughly you're missing the point of this system.

The electron that comes through your socket doesn't need to be generated by a "green" power plant for you to consume "green" energy, this is because electrons are fungible.

Of course we also want to shift to 100% green energy power plants, but in the meantime energy demand is also elastic. The point of the energy credit system is to shift electricity demand from areas that supply real "dirty" energy to those that supply "real" green energy.

This happens because a "green" power plant in Norway might sell its energy for 20 cents/kWh, which would be the same as a "dirty" power plant in Denmark. But if the "dirty" plant needs to buy "green" credits from the Norwegian one it might have to raise its prices to 25 cents/kWh, and the Norwegian one can lower them to 15 cents/kWh.

This would then have the effect that an energy consumer (say a factory) might move its operation to Norway to benefit from cheaper energy, or consumers would buy the subsidized Norwegian product over the Danish one.

Except for the small detail that it doesn't actually have much of an effect from a macro-economic point of view, but that's because we collectively think this whole climate change thing isn't really all that important, and thus the energy credits are relatively cheap and add almost nothing to the end-user price.

But that's the fault of political priorities, the system itself is relatively elegant and would have more of an effect if its designed was backed up by larger political commitments.

You don't need to prepend "Respectfully" in order to insult. You can just go ahead and say it directly, and what you are doing is helping climate change skeptics by hiding the fact that coal that was once in the ground is now being burned and released into the air as pollution.

If you dig out coal and burn it in a power plant then you are producing pollution and contributing to global warming. No amount of exporting green energy changes that fact.

You are trying to dodge the question why there is a big whole in the ground where the coal once where. Someone mined it. Someone burned it. Someone bought it. Each and everyone involved are partly responsible for the harm this act caused to the environment. It is a bit like thief stealing, a fence reselling it and a customer buying it without asking questions of why it is so cheap. It is not an elegant system because in the end a crime occurred and real harm has happened.

If you want to produce green energy or run a nuclear plant then do what ever feels best, but the coal stays in the ground. No amount of misleading can hide the fact that digging it out is harmful to the planet, both on a macro and micro level, and if you fund coal mining by buying their energy then you are part of the problem.

It's not being hidden, it's being exhaustively documented.

Of course burning coal sucks, and we should replace those power plants.

But until then we can also discourage their use by subsidising clean energy at their expense. That's what this system is meant to accomplish.

It's beyond me how someone can look at what's effectively a tax on non-renewables as whitewashing those energy sources. You tax behavior you want to discourage.

When society collectively decide that something suck we have a simple mechanism to fix it. We make it illegal. Theft suck. We have thus laws against it.

A carbon tax in the energy sector helps but it is a rather inefficient method compared to simply keeping the coal in the ground. People keep finding ways to make profits from digging the coal out and burning it, and Sweden is currently a customer to those people.

The system has not been successful in keeping the coal in the ground. What it currently accomplishing in Sweden is the opposite, as Swedish use of coal energy has increased. A simple law would fix that, and it doesn't require a discussion about what energy should be subsidized. The only thing required is a stroke of the law writers pen. It is the easiest, simplest and most efficient solution in keeping the coal in the ground and the only reason people are not doing it is that people want to keep buying the energy produced by burning coal.

The energy credit system accomplishes some things that your proposals don't.

It's not realistic to make burning coal and other non-renewables illegal in Europe, less than 20% of the grid has been transitioned[1]. You can't just shut off 80% of the grid without European civilization as we know it coming to an end for the foreseeable future.

In the meantime there's plenty of uses of energy that can be built in one EU/EEA country or the other, or shifted between countries, and which will respond to price incentives.

E.g. a data center that's not ping-time sensitive or bulk bandwidth sensitive is probably better placed in Iceland than The Netherlands from an ecological perspective.

The impact of the energy credit system is to shift that sort of use between countries and energy providers, to the extent that their use will respond to price incentives.

It is relatively ineffective in the larger scheme of things, just like our buildup of renewable energy is proceeding at a relatively slow pace. But that's not an argument against the systems in place per-se, just like some country setting their VAT at 1% isn't an argument against VAT structurally.

The EU/EEA agreement doesn't have explicit tax-raising powers, so it's really not the case that a simple law could do the same thing. This system is effectively a way to create a new EEA-wide tax through a back-door mechanism.

Any national tax policy wouldn't be as effective, because individual countries in the EEA market can't or aren't going to enact law that mandates that some of their companies move abroad because their own energy market isn't renewable enough.

It also gives individual consumers a way to vote with their money to increase the buildup of renewables.

As an example, I live in Amsterdam where (as far as I know) I have no choice but to consume electrons sourced by burning fossil fuels[2].

However, I have opted to pay extra to buy "green" (wind and solar) energy, but the energy that comes out of my power plugs as I type this comment is still sourced from burning coal/gas.

Am I just participating in a gigantic sham? No, because what I'm doing is buying the production of energy capacity corresponding to my own use for use elsewhere on the power grid. So I'm taking part in reducing the overall demand for fossil fuels, and thus doing my own small part in reducing pollution.

By the way, from a cursory glance the current Swedish carbon tax is at best around 1/4 per-ton of the cost of sequestering that CO^2 back into the ground.

If that's the case of course it's not really all that effective, but just like in the case of the energy credit system the problem there isn't with the very concept of the system of a carbon tax (which is probably the single best way to deal with the overall problem), but with the value that tax is set at.

1. https://ec.europa.eu/eurostat/statistics-explained/index.php...

2. https://nl.wikipedia.org/wiki/Centrale_Hemweg

> You can't just shut off 80% of the grid without European civilization as we know it coming to an end for the foreseeable future.

Good thing the Swedish energy grid is not made out of 80% coal and other fossil fuels. It is a strawman argument to talk about shutting down 80% of the whole European energy grid in the context of the Swedish energy grid.

> As an example, I live in Amsterdam

Netherlands power grid only utilize 5% nuclear power. It has no hydro. If you made fossil fuels illegal than that would indeed make civilization as you know it coming to an end. Your power grid is wholly depended on fossil fuels for keeping the light on. Even if more wind farms and solar plants was built the coal would continue to burn during still nights.

It would not however be very hard to change that. A nuclear plant, or if you prefer an experimental battery dam would solve the issue quite fast. Just a simple matter of money and political will. Given the knowledge and experience in flood control it would even be quite suitable placement batteries, pumping in water when wind production are high and the price is cheap, and producing energy when the wind is still. At most 10-20 years, and faster if the incentives were right.

Putting pollution in the sky is not morally defenseable just because you paid a higher markup on the power bill. The markup should only exist to incentivize people to invest, and the cost should be increased until it accomplish this. Since people like to claim that nuclear is currently unprofitable, the solution then is pretty simple. Raise the tax on coal energy so that even just buying coal energy during still winter nights is still more expensive than building the nuclear plant. At that point it is no longer unprofitable to run the nuclear plant. If wind+solar+battery is cheaper then go with that, just as long as the coal stay in the ground.

But for Sweden it would just be easier to ban fossil fueled energy as we have enough hydro and nuclear to get us through still winter nights. It would however force a choice between wind+solar+battery vs nuclear, rather than the current wind+solar+coal vs nuclear. The later is unacceptable from an environmental perspective.

(I will note that a law banning fossil fuel is indistinguishable from a carbon tax that is high enough to make it more profitable to build non-polluting alternative to burning fossil fuels. The fact that people still burn fossil fuel is thus a proof that the tax is not high enough).

> It is a strawman argument to talk about shutting down 80% of the whole European energy grid in the context of the Swedish energy grid.

Yeah, it would be if we were discussing Sweden's energy grid. You're commenting in a subthread about the EEA-wide energy credit system in general. You're the one who brought up Sweden in the context of an unrelated point.

But even if we were only discussing Sweden the same point would apply, there's that 20% of the grid that's still being transitioned. The energy credit system is a way to shift power demand to the other 80%, to the extent that such demand is say location and not capacity-limited within Sweden.

> A nuclear plant, or if you prefer an experimental battery dam would solve the issue quite fast. Just a simple matter of money and political will.

Sure, and if someone made me emperor of Europe that's one of the things we'd be running a Manhattan-level project to accomplish.

But to present that as a counterargument to energy credits is to miss the point, these are different issues. Even in such a scenario it's still going to take some years to transition the grid due to manufacturing and logistical issues.

In that time period you'd want to give consumers in the EEA-market a price incentive to build their factory next to a solar plant instead of a coal plant. The energy credit market is a way to work towards that.

To say we should do away with energy credits entirely because, and I'm really not sure I understand your argument, but you seem to be saying that they're they're morally indefensible or not an elegant solution?

Anyway, that's going to result in needless pollution while we build up renewables. Now who's taking a morally indefensible position?

I'm not claiming sainthood by electing to pay a slightly higher energy price. Could I do more? Yes. I am saying that you're fundamentally misunderstanding how price incentives and elastic demand factor into the equation.

It's not the case that my local coal plant is running at 100% capacity all the time, and by electing to buy "green" energy I'm making the coal product more expensive than the renewable product.

Thus while I keep the lights on with coal, me and a bunch of other people in the are area doing our part to shift new demand for energy out of the area. There's going to be a price point where e.g. someone thinking of installing a server rack that consumes as much energy as me and all my neighbors elects to install it near a "green" plant, not near a coal plant.

Do you feel similarly about other harm mitigation that's part of public policy? E.g. do you think because we should switch to near-100% electric vehicles the EU's increasingly strict regulations on catalytic converters is pointless? That's what the energy credit system is, it's a transition and harm reduction mechanism.

> I will note that a law banning fossil fuel is indistinguishable from a carbon tax that is high enough to make it more profitable to build non-polluting alternative to burning fossil fuels.

No it's not. Even if fossil fuels were prohibitively expensive for energy production we'd still have things like airplanes that are going to be paying for the energy density in fossil fuels way past the price point where a proposed CO^2 tax matches the cost of cleaning up the pollution involved.

> Even if fossil fuels were prohibitively expensive for energy production we'd still have things like airplanes

For someone who speak about off-topic, since when did we, the article or anything in this thread talk about the transport sector? A few other sectors we also never talked about is space travel, the military, and agriculture.

The claim is that a law banning fossil fuels in the energy sector is indistinguishable from a carbon tax that is high enough to make it more profitable to build non-polluting power plants alternatives to power plants burning fossil fuels.

> Anyway, that's going to result in needless pollution while we build up renewables

How is keeping the coal and natural gas in the ground going to cause needless pollution? Nonsense.

> It's not the case that my local coal plant is running at 100% capacity all the time, and by electing to buy "green" energy I'm making the coal product more expensive than the renewable product.

And yet the coal is still cheaper because otherwise you would not continue to buy it, and people would not build new natural gas plants unless they thought it would pay. It illustrate how well the shift of new energy is incentivized.

Naturally people will build wind power. It is cheaper than coal when it is blowing, and it makes the coal energy more expensive when burned. Everyone wins, except that the coal keep getting mined and burned and this thing called global warming is happening which people prefer to ignore.

You accuse me of not wanting harm mitigation, but that is completely wrong. I don't mind at all the wind and solar plants being built, but I can fully see the data which says that the fossil fueled pollution in the power grid is going up, not down. It pretty basic logic that when the method which claim to decrease pollution is increasing it then the method is flawed.

Denmark is a pretty good example where peak wind has been reached. At optimal condition their whole energy grid can be produced from wind. Wind farm operators want to be paid so they build farms until at peak they still get sell the energy, as overproduction is not just wasteful but costly.

How often do a wind farm produce 100% of maximum? Not often. we can make a simplify statement that on average they produce about 50%, which mean the other 50% must come from somewhere. Primarily fossil fuels.

So what is Denmark average gCO2eq/kWh? Better than some but far from competing with countries like France, and even if everyone other country in EU copied Denmark it would not be enough in order to prevent catastrophic global warming.

> For someone who speak about off-topic, since when did we, the article or anything in this thread talk about the transport sector?

Within the span of the two paragraphs I quoted you went back and forth between "ban fossil fueled energy" and "a law banning fossil fuel", so I inferred that you were talking about a ban on fossil fuels for all applications.

The transport sector just made for an easy example. The same is also true for many applications in the energy sector, e.g. diesel generators on remote islands, or as backup generators. Entirely banning these fuels would be a stupid idea, we should just charge for the externalities they cause.

> How is keeping the coal and natural gas in the ground going to cause needless pollution? Nonsense.

Because as you yourself claim a complete conversion of the grid war-footing amounts of political will would probably take at least 10-20 years, meanwhile we're burning coal as we transition. If we have price incentives to not only phase out coal demand, but also to shift it we'll keep more of it in the ground.

So yes, we agree that keeping more fossil fuel in the ground generally speaking results in less pollution.

I'm pointing out that to do so you not only need to work on energy production (build power plants), but shift energy demand (taxes, energy credits etc.).

I'm basically summarizing what I understand from the PR material from the relevant EU institutions, you're making claims that would either win you a Nobel price if they were true, or at least get you on the front page of most European newspapers ("Internet man saves EU billions of Euros by getting rid of lots of pointless institutions, processes etc.").

> [...]I can fully see the data which says that the fossil fueled pollution in the power grid is going up, not down. It pretty basic logic that when the method which claim to decrease pollution is increasing it then the method is flawed.

I haven't seen the numbers you're alluding to, but I don't see how that's a violation of basic logic, it's trivial to show that all of the following can be true:

1. Fossil fuel use is going down as a proportion of overall energy use.

2. Fossil fuel use is going up in absolute terms.

3. We have some system in place (say energy credits or a carbon tax) that's reducing fossil fuel use.

You just need to have a situation where the growth in energy demand is outpacing the pace of your energy source transition.

In such a situation it would be a mistake to say "absolute use is going up, any mitigation we have in place must be doing nothing".

Maybe those mitigations are doing nothing, or maybe the situation would be a lot worse if they weren't in place.

> Denmark is a pretty good example[...]

No it's not. My point several replies above this one has been that energy credits help with the overall problem, not that they're guaranteed to solve it. Clearly an example of a problem that isn't fully solved isn't a refutation of a mechanism that's suggested to contribute to an overall solution.

This would be like saying that speeding fines aren't an effective method of helping with overall traffic safety because people still speed on public roads.

That's all I've been maintaining here. There's a common misconception about energy credits that they're not only ineffective, but that they're some sort of sham. I think that's a misunderstanding of people who don't know how they work, and you continuing to drag up examples that have nothing whatsoever to do with that point isn't a convincing counterargument.

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