Renewable Energy

Driverless Argonauts are all on valuation quests

12 July 2019

Ford and VW value their new autonomous-car joint venture at more than $7 bln. SoftBank and others peg GM’s similar division at $19 bln. Yet estimates on revenue and timing are all over the map. And Google’s Waymo is leading on several metrics. Their real worth could be anywhere.

The Exchange: Escaping carbon’s grip

25 June 2019

Saipem made its name building drills and pipelines for fossil-fuel giants like Saudi Aramco. CEO Stefano Cao visits Breakingviews to discuss how climate change is pushing the company into greener projects – and how tech challenges and a need to protect margins will drive M&A.

California’s green-power glut has a silver lining

24 June 2019

The Golden State wants half its electricity needs from renewables by 2025, yet last month reduced solar and wind production by the most on record. Expensive storage is the problem. That should soon change. Meantime, savvy companies can take advantage of sporadic free power.

Shell’s giant cash gusher is climate-change hedge

4 June 2019

The oil major plans to hand half its $250 bln market cap to investors from 2021-2025. As a result, the share of resources poured into capital investment will fall. It may look short-termist, but it’s really a sensible admission of uncertainty about the future of fossil fuels.

BP investors take the slow road to climate action

21 May 2019

Shareholders endorsed greater disclosure of the oil major’s compatibility with Paris climate goals, but rejected binding targets. It’s a start, but hardly matches the scale of the problem. Both BP and its owners appear unsurprisingly happy to wait for greater political urgency.

Shell’s low-carbon shift yet to charm investors

2 May 2019

The Anglo-Dutch group had a more profitable quarter than Exxon and is better placed for a greener future. But its valuation lags that of its U.S. peer, which finds more new reserves. Investors seem to care more about how much oil is pumped now than when crude demand will peak.

Elliott kicks China’s EDP bid when it’s down

14 February 2019

The activist investor objected to China Three Gorges’ offer for the Portuguese utility. The deal was struggling, and Elliott’s plan, to invest in renewables, isn’t controversial. But the Chinese group’s large shareholding could still be a problem for Paul Singer’s fund.

Hadas: Silly carbon tax talk hides hard choices

2 January 2019

The principle that higher prices reduce demand lies behind calls for levies on carbon dioxide emissions. But prices cannot do much in the large, complicated and economically crucial energy industry. Only big government, or major lifestyle adjustments, can really change things.

Strange solar deal puts sunlight on market mayhem

24 October 2018

Hanergy Mobile Energy wants to buy out Hong Kong-listed Hanergy Thin Film at a $27 bln value and take it public in mainland China. The same man behind the mess that has left the target’s shares frozen for years controls the parent. It hardly makes these market structures shine.

Hot summers are least of UK utilities’ problems

12 September 2018

SSE’s shares dipped after high temperatures and gas prices forced a profit warning. A cap on tariffs for retail customers will hit the sector further. And all energy companies have to work out how to cope with the falling cost of renewables and competition from new entrants.

China’s solar stress could burn more dealmakers

13 August 2018

Slashing official support for solar energy helped scupper Shanghai Electric’s plan to snap up a $2 bln stake in giant GCL-Poly’s core unit. A downturn should drive consolidation in the heavily indebted sector. But the doomed deal shows how hard it is for two sides to agree.

Elon Musk outburst puts Tesla board on the spot

16 July 2018

Punishing a CEO who tweets, without evidence, that someone is a pedophile ought to be a no-brainer. But Musk’s fortunes and the electric-car maker’s are symbiotic, and his allies pack the board. Investors should worry for their own sakes if directors fail to act this time.

CATL’s overseas charge has lasting power

10 July 2018

The Chinese battery champion will build its first factory abroad in Germany after scoring a $5 bln supply deal with BMW. It establishes a base in a promising market for electric vehicles. The newly listed company is cementing its lead over compatriot Warren Buffett-backed BYD.

China’s renewable giants can live without handouts

29 June 2018

Authorities are pulling state subsidies for solar and wind companies. The shake-out recalls earlier crises, which claimed stars like Suntech. Now, however, cheaper technology and better supporting infrastructure give clean energy champions a chance to thrive on their own.

Tesla shareholders box themselves into corner

5 June 2018

They ought to strip CEO Elon Musk of the chairmanship thanks to his sprawling responsibilities, production problems and recent outbursts. But investors helped make Tesla a personality-cult stock. Any direct attack on Musk risks undermining the electric-car maker’s fortunes.

Nuclear deal flags UK’s public investment caprice

5 June 2018

Britain may take a stake in Hitachi’s likely $20 bln-plus Wylfa power plant. That could make it cheaper than the controversial Hinkley deal. Yet it’s still a big bet on a scheme that energy shifts could render ill-advised, at a time when simpler public projects have been spurned.

Enel’s Brazil dominance needs elbow grease

31 May 2018

The Italian utility offered $2 bln to buy grid operator Eletropaulo, over three times its market value in March. It makes sense for Enel to grow its presence in South America’s biggest country, but extracting value at this price will require hefty cost savings and efficiencies.

Oil rally puts New Delhi in a bind

29 May 2018

As a major energy importer, India is in a tight spot. Taxes introduced when crude was cheap are now squeezing consumers. The government can’t reverse course without creating a budget hole – unless it makes up the shortfall by taxing ONGC and other producers instead.

Portuguese power bid tests EU’s open door to China

11 May 2018

China Three Gorges is set to bid for the 77 pct of EDP it doesn’t own. The group has been an investor since 2011, but success would place the 11 bln euro utility under Chinese state control. That will add a spark to European Commission plans to better screen foreign investment.

California helps Paris send solar message

11 May 2018

The most populous U.S. state is making panels mandatory on most homes built after 2020. It will cut emissions only a little. But the clean-energy focus will push other states along. Fossil-fuel producers will have fewer excuses to ignore the renewable writing on the wall, too.