Kerry Burnishes Green Badge in Asia as Volcano Disrupts Trip

Photographer: Ulet Ifansasti/Getty Images

Villagers cook in front of their damaged house after the eruptions of Mount Kelud at Pandansari village on February 16, 2014 in Malang Regency, Indonesia. Close

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Photographer: Ulet Ifansasti/Getty Images

Villagers cook in front of their damaged house after the eruptions of Mount Kelud at Pandansari village on February 16, 2014 in Malang Regency, Indonesia.

U.S. Secretary of State John Kerry said global warming is as big a threat as terrorism in a speech in Indonesia, the world’s largest exporter of coal for power plants, seeking to burnish his credential as a climate champion before deciding on the proposed Keystone XL pipeline project.

Speaking yesterday in the capital of Jakarta, the last stop on his three-nation Asia tour, Kerry called on the international community -- nations and individuals -- to do more now as addressing climate change required a global solution. The speech came against the backdrop of the eruption of the Mount Kelud volcano that disrupted air travel in the region and forced the cancellation of Kerry’s planned meeting today with President Susilo Bambang Yudhoyono

“We’ve seen here in Asia how extreme weather events can disrupt world trade,” Kerry said to an audience of Indonesian students and business leaders. “In today’s globalized economy, the entire world feels it.”

Kerry’s emphasis on the importance of individual responsibility coincides with his dilemma on whether to back TransCanada Corp. (TRP)’s proposal for a $5.4 billion pipeline to carry heavy crude from Canada to U.S. refineries along the Gulf of Mexico.

Photographer: Evan Vucci/AFP via Getty Images

U.S. Secretary of State John Kerry gestures during a speech on climate change in Jakarta on February 16, 2014. Close

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Photographer: Evan Vucci/AFP via Getty Images

U.S. Secretary of State John Kerry gestures during a speech on climate change in Jakarta on February 16, 2014.

Without more action to combat global warming, scientists predict extreme weather events such as last year’s Typhoon Haiyan in the Philippines will occur, Kerry said. He likened climate change to global threats such as terrorism and the proliferation of weapons of mass destruction.

“The solution is energy policy. It’s as simple as that,” he said. “Governments and international financial institutions should stop incentivizing the use of energy sources like coal and oil.”

Greater Innovation

Climate change can also be an economic opportunity, Kerry said, adding that investment in “the global energy market of the future” is expected to reach nearly $17 trillion between now and 2035.

In order to boost investments in the sector, governments must encourage greater innovation in renewable energy technology and check the use of coal and oil as power sources for their immediate energy needs.

Kerry said the world “must look further down the line,” even as he acknowledged the challenges for developing countries such as Indonesia in developing alternate energy sources.

“They have to factor in the cost of survival,” he said. “And if they do, they will find that the cost of pursuing clean energy now is far cheaper than paying for the consequences of climate change later.”

U.S.-China Cooperation

Kerry arrived in Indonesia, Southeast Asia’s largest economy, on Feb. 15 after a day and a half in China, where he won agreement on five joint actions to reduce greenhouse gases, such as cutting vehicle emissions and improving energy efficiency of buildings.

A joint U.S.-China statement was issued shortly before Kerry’s departure from Beijing, to signal that the world’s two largest economies are committed to working together to mitigate their roles in acceleration of global warming.

The agreement includes “the sharing of information on our respective post-2020 plans to limit greenhouse gas emissions,” Kerry said. “These plans are a key input into United Nations negotiations to develop a new global climate agreement.”

“China agrees with the United States that it’s time to pursue a cleaner path forward,” he said. “Make no mistake: this is real progress.”

Biggest Emitters

China and the U.S. are the world’s biggest emitters of carbon dioxide and other gases that trap solar heat. Scientists warn that rising temperatures threaten to intensify tropical cyclones such as last year’s Typhoon Haiyan, which left as many as 10,000 people dead in the Philippines.

“Together, the U.S. and China account for some 40 percent of the carbon pollution that is released into the atmosphere,” Kerry told Chinese workers on Feb. 15 at the Cummins Inc. and Beiqi Foton Motor Co. (600166) joint venture, which produces clean diesel engines. “It is imperative for us to work together.”

Kerry will use the trip to Indonesia, an archipelago of 17,000 islands that is vulnerable to and highly focused on the threat of climate change, to focus attention on the issue, a State Department official said Feb. 12 on the purpose of Kerry’s visit. The top U.S. diplomat met Foreign Minister Marty Natalegawa for dinner after the speech. The two will hold a joint press conference today.

Deforestation

Deforestation is the main cause of emissions from Indonesia, named by the World Bank as the third-largest emitter on earth in a 2007 report.

Expansion of the pulp and paper, and palm oil industries has led to widespread deforestation in the past decade. While the Indonesian government has a moratorium on deforestation of natural forests, burning of trees on Sumatra island led to record levels of dangerous haze pollution in neighboring Singapore last year.

Jakarta regularly suffers floods during the rainy season, with more than 48,000 evacuated from their homes in the capital in January.

Kerry, who spent much of his Senate career fighting an unsuccessful battle for climate legislation, may be pressured to approve TransCanada’s Keystone proposal in a turn away from urging governments to do more to address climate change risks.

Tar Sands

TransCanada applied more than five years ago for a permit for the 875-mile (1,407 kilometers) section of the 1,700-mile pipeline through the U.S. heartland, connecting oil sands in Alberta with refineries along the coast of Texas and Louisiana.

The Keystone XL pipeline would carry oil from western Canada, mostly from Alberta’s tar sands, as well as 100,000 barrels per day of oil fracked from the Bakken Shale in North Dakota. Much of that oil is already being produced and is being transported by other means, such as railroads.

Under a 2004 George W. Bush executive order, the secretary of state makes the call on certain energy-related projects that cross international borders. While Obama has the final say, Kerry’s recommendation will play a key role in the formal decision.

To contact the reporter on this story: Sangwon Yoon in Jakarta at syoon32@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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