EU and US green arms race misses bigger picture 16 Mar 2023 The European Union’s response to Joe Biden’s Inflation Reduction Act gives member states leeway to push back with their own green subsidies. Yet plans for production targets are misguided. To decarbonise while managing China risks, it’s better to seek common ground with the US.
Europe is playing catch-up in green subsidy race 9 Feb 2023 The U.S. unveiled $369 bln of climate subsidies for consumers and manufacturers. In this Viewsroom podcast, Breakingviews columnists explain why Brussels may need to launch a similarly ambitious plan or risk losing its share of jobs of the future.
Orsted increasingly merits its investor blowback 20 Jan 2023 The $38 bln Danish wind farm group flagged lower-than-expected 2023 targets as its key offshore arm struggled. Shareholders always granted Orsted a premium valuation, due to growth expected from new projects. Construction delays and rising rates are putting that in question.
Europe’s energy crisis nears winter of discontent 18 Oct 2022 Germany, Italy and others have scrambled to replace Russian gas and pipeline attacks have become a concern. The Oxford Institute for Energy Studies’ Jack Sharples tells The Exchange podcast Europe must learn to live with less power. Next year may be even more challenging.
Net zero woes go beyond lack of global cooperation 20 Sep 2022 The International Energy Agency frets that poor collaboration between states will keep emissions high. But the struggles of green groups like ITM Power suggest countries aren’t doing enough to help domestic markets either. Energy policy needs to do more than fight today’s crisis.
ESG is more of a muddle than a fiddle 19 Jul 2022 Environmental, social and governance investing is under the spotlight. In this episode of The Exchange podcast, Bridgewater’s sustainable finance gurus Karen Karniol-Tambour and Carsten Stendevad explain how ESG’s main problem is a lack of clarity over its goals.
UK windfall tax has reasonable hierarchy of pain 26 May 2022 Finance minister Rishi Sunak is funding a $19 bln fiscal support plan with a $6 bln raid on North Sea oil. The levy is gentle on companies who invest, and harsh on those with big tax assets from past losses. But high energy prices mean a further thwack to utilities may follow.
UK’s power tax plan may avoid tilting at windmills 24 May 2022 Shares in utilities like SSE and Drax dived after reports of Rishi Sunak eyeing up 10 bln pounds of excess profits. Windfalls from high power prices are hard to grab and North Sea oil is a better target. But the UK chancellor’s haul from power groups will still be far from zero.
Siemens Gamesa’s minorities can hold out for more 23 May 2022 The turbine maker’s parent wants to take it private at 18 euros a share, half its value in early 2021. After a slew of profit warnings, any exit looks tempting. But with big savings in store and 2.5 bln euros in the bank, Siemens Energy CEO Christian Bruch can afford to pay more.
Europe may swap one energy dependency for another 9 May 2022 The bloc is ramping up investment in renewable sources to help kick its addiction to Russian oil and gas. Yet China currently controls at least 75% of the solar panel supply chain. To gain its energy freedom, Europe will also need to invest in manufacturing at home.
Windmill makers’ vicious cost cycle has an ending 5 May 2022 Denmark’s Vestas and rival Siemens Gamesa have failed to turn booming demand for wind farms into higher earnings. Increased prices to offset soaring raw material costs will take several years to kick in. But now wind power is cheaper than fossil fuels, price pressures are easing.
Capital Calls: Ford’s private equity playbook 2 Mar 2022 Concise views on global finance: The Detroit automaker’s reorganization plan makes explicit the goal of squeezing its traditional car business for cash to fund its electric future.
Offshore wind power gets a tartan quantum leap 7 Feb 2022 The green energy’s drawback is its major use of scarce coastal shelf. Scotland’s recent auction of 15 gigawatts of floating turbines, enough to power 60% of UK homes, changes the game. The economies of scale created should make a nascent technology cost-competitive quicker.
Siemens Gamesa’s new Mr. Fixit can take his time 3 Feb 2022 The wind turbine maker has ousted its second CEO in two years. As another German, Jochen Eickholt may get a frosty reception from Spanish bits of the firm. Parent Siemens Energy won’t mind. The longer Gamesa’s woes drag on, the easier it will be to buy out minority investors.
Siemens Energy wind fix would be worth the money 28 Jan 2022 The German group may buy out minority investors at struggling wind-turbine subsidiary Gamesa. The 5 bln euro bill sounds steep, especially as the problems may be temporary. Yet Siemens Energy can afford it, and it would get to keep the upside for itself when wind power scales up.
Scotland shows England how to run a wind auction 17 Jan 2022 Edinburgh has sold permits for a huge 25 GW of offshore power at cheaper prices than London a year ago. Successful bidders will be more likely to deliver without strife, letting politicians hit green targets. It also gives Scotland bargaining chips in any future secession talks.
Climate-change money will flow freely to Plan B 24 Dec 2021 COP26’s so-so outcome makes damaging temperature rises more likely. At some point, optimal portfolios may require guns and canned food. Until then investors will lean towards shares in Syngenta, Veolia and other companies that aid adaptation to global warming not just mitigation.
Capital Calls: Nikola’s SEC collision damage 21 Dec 2021 Concise views on global finance: The electric-truck maker is paying the U.S. securities watchdog $125 million. It’s a big dent but, given the stakes for SPACs and their targets, may only mildly discourage cheerleaders from taking the step from hype into fraud.
Rolls-Royce nuclear plans piggyback green success 9 Nov 2021 The UK engineer and partners are pumping 195 mln pounds into a unit to build small commercial reactors. As with wind and solar, the British government is helping by promising to buy the plants’ electricity. It should mean a lucrative side hobby for the group run by Warren East.
Wind turbine makers are victims of own success 3 Nov 2021 Soaring demand for renewable energy has inflated Vestas and Siemens Gamesa into multibillion-dollar firms. Yet the pair are struggling to turn a profit because of steep rises in raw materials costs. Passing those on will end wind power’s long-term trend of falling prices.