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SFCE Aug 12
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meteocontrol to supply Zonergy’s Punjab solar farm
Aug 12, 2015 | PV Magazine
By Jonathan Gifford
Shungfeng owned meteocontrol has been selected to supply monitoring and remote control technology to Zonergy’s solar farm in Punjab, Pakistan. The 100 MW first stage of the park is near to completion, the company reports, with the plan being for it to grow to 900 MW on completion. -
meteocontrol to offer remote control systems for first phase of 900MW PV plant in Pakistan
Aug 11, 2015 | PV Tech
By Conor Ryan
meteocontrol China, a subsidiary of Shunfeng International Clean Energy, is set to offer integrated remote control systems to PV development and investment company Zonergy’s 100MW phase-one set for a power station in Punjab Province, Pakistan. -
Solar Power Deals & Company News
Aug 12, 2015 | Recharge
...A subsidiary of Shunfeng International Clean Energy, meteocontrol China, will provide remote control systems for the first 100MW- phase of a solar PV project in Pakistan to be developed by investment company Zonergy. As part of the agreement, meteocontrol will offer data acquisition devices, sensor and portal software... -
China Advised to Double 2020 Solar-Power Goal
Aug 12, 2015 | BNA Daily Environment Report
China is being encouraged by three industry groups to double the nation's solar-power goal for 2020 to fill a gap forecast to emerge because nuclear and hydropower are due to fall short of targets. The world's biggest solar market needs 200 gigawatts of such capacity by then, according to a document made available to Bloomberg. -
Australia pledges emissions cut
Aug 11, 2015 | The Hill - E2 Wire
By Timothy Cama
Australia’s government on Tuesday announced a pledge to cut greenhouse gas emissions 26 to 28 percent by 2030 as part of a United Nations agreement to stop climate change. The pledge, which uses 2005 emissions as a baseline, puts Australia behind other major nations... -
China Energy Intensity, Consumption Continue Decline
Aug 12, 2015 | BNA Daily Environment Report
By Michael Standaert
China's consumption of energy per unit of gross domestic product generated dropped by 5.9 percent for the first half of 2015 compared to the same period a year before, as the country continues to adjust the structure of its economy away from heavy industry. -
New Zealand puts bets on diverse energy mix
Aug 12, 2015 | UPI
By Daniel J. Graeber
Boasting of more spending by oil and gas explorers and increased renewable energy output, New Zealand's government said the right mix is good for the long term. A federal government report published Wednesday finds renewable energy made up 39.5 percent of the nation's total primary energy supply, a measure of total... -
Iran And Spain Sign Agreement For Cooperation On Renewable Energy
Aug 12, 2015 | Clean Technica
By Smiti Mittal
With the isolation of Iran expected to end following a landmark deal on the country’s nuclear program, countries across the world are looking to enhance cooperation with the Islamic republic. Spain has signed an agreement with Iran to boost cooperation in Iran’s renewable energy industry, and will extend technical cooperation in designing... -
3 Reasons Why America Is Turning to Renewable Energy
Aug 12, 2015 | EcoWatch
By Tara Lohan
Deborah Lawrence had been watching a once-empty parking lot near Midland-Odessa, Texas, fill up with idled drilling rigs usually at work plumbing for oil in the nearby Permian Basin. In January she noticed 10 rigs, then 17 a few weeks later. As winter turned to spring, the number climbed to 35. -
Chile Mines Turn to Renewable Energy
Aug 11, 2015 | The Wall Street Journal
By Ryan Dube
The three industrial boilers at the state-owned Codelco mine high in the mountains here once consumed 67,000 barrels of diesel a year to turn out shiny copper sheets for export. Now, the job is powered by nearly 3,000 solar panels that take advantage of the Atacama Desert’s cloudless blue sky.
Meteocontrol News
Industry News
Full Text of Stories Below
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meteocontrol to supply Zonergy’s Punjab solar farm
Aug 12, 2015 | PV Magazine
By Jonathan Gifford
Shungfeng owned meteocontrol has been selected to supply monitoring and remote control technology to Zonergy’s solar farm in Punjab, Pakistan. The 100 MW first stage of the park is near to completion, the company reports, with the plan being for it to grow to 900 MW on completion.
Meteocontrol and Chinese PV developer Zonergy will come together under an agreement in which the German-based monitoring firm will develop and deploy monitoring and park optimization solutions to Zonergy’s emerging fleet of PV projects. Under the agreement, meteocontrol will supply Zonergy’s solar park in Pakistan’s Punjab region.
The Punjab project has been touted as reaching anything from 500 MW to 1 GW in a number of statements about the project in recent years, with the latest indication that it will have a capacity of 900 MW when completed. The Punjab project is to be completed as a part of the China-Pakistan Economic Corridor project.
Meteocontrol will supply its generation II monitoring hardware, sensors and VCOM software, while designing the monitoring system, commission its installation and provide training.
The supply deal is a part of a larger partnership that will see meteocontrol further develop and deploy is hard and software solutions to Zonergy’s fleet, with the aim being to reduce O&M costs and optimize park performance and output.
“It is great pleasure to cooperate with Zonergy to provide professional and efficient solutions and service to the 100MW phase one project of the 900 MW terrestrial PV power station in Punjab, Pakistan,” said meteocontrol China General Manager Henry Luo. “This is also an excellent opportunity to deepen bilateral cooperation on smart operation and maintenance management of PV power stations.”
Meteocontrol was acquired by Shunfeng International Clean Energy (SFCE) in September 2014. SFCE made a number of acquisitions across the clean energy value chain in 2014, including the then ailing module giant Suntech. After the spate of acquisitions, SFCE is in a consolidation year in 2014, looking to develop its acquisitions and see them return to growth. Certainly under SFCE’s ownership, meteocontrol is in a far stronger position to push into the Chinese solar market and to partner with Chinese developers such as Zonergy.
Meteocontrol claims to currently monitor 37,500 solar systems with a capacity of 12 GW.
Link: http://www.pv-magazine.com/news/details/beitrag/meteocontrol-to-supply-zonergys-punjab-solar-farm_100020565/#axzz3ibVywaAK
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meteocontrol to offer remote control systems for first phase of 900MW PV plant in Pakistan
Aug 11, 2015 | PV Tech
By Conor Ryan
meteocontrol China, a subsidiary of Shunfeng International Clean Energy, is set to offer integrated remote control systems to PV development and investment company Zonergy’s 100MW phase-one set for a power station in Punjab Province, Pakistan.
Once completed, the installation is estimated to stand as the largest single PV power project at 900MW. As part of the agreement between the two parties, meteocontrol will offer data acquisition devices, sensor and portal software, along with related configuration, commissioning and training services.
meteocontrol will also provide specialized monitoring — in addition to operation and maintenance solutions — for Zonergy’s total development plan for its PV power plant business segment.
Jacky Jia, vice president of Zonergy, said: “Zonergy and meteocontrol have reached a consensus that we will jointly seize the market opportunities brought by China's "One Belt, One Road" strategy, through leveraging meteocontrol's extensive expertise in PV power station operation and maintenance management, so as to ensure the quality of our power station, provide greater efficiency, reduce generation costs, and create more value for the customers.”
Link: http://www.pv-tech.org/news/meteocontrol_to_offer_remote_control_systems_for_first_phase_of_900mw_pv_pl
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Solar Power Deals & Company News
Aug 12, 2015 | Recharge
Deals and company news from the global solar sector this weekCentral American developer Grupo Onyx finalised the last phase of the 80MW Horus solar project in Guatemala, putting the project in operation. Located in Santa Rosa, the $160m development was constructed over 3 years in two, 50MW and 30MW, phases, respectively. Both phases benefited from long terms sale agreements with the electricity providers in Guatemala.
Spanish developer Fotowatio Renewable Ventures (FRV) has installed nearly 100,000 solar panels at the 56MW Moree Solar Farm, which is currently under construction in New South Wales, Australia. The AU$164 million (US$119 million) plant, located on 280 hectares, is expected to be complete by early 2016. When complete it will hold 222,880 polycrystalline panels, supplied by panel manufacturer JA Solar.
Solar3D has signed a definitive agreement to acquire 100% of Elite Solar, a California-based solar systems provider. The deal, with an undisclosed value, will see Elite operate as a wholly owned subsidiary of Solar3D. Jim Nelson, CEO of Solar3D said:“By combining Elite Solar’s experience and reach with Solar3D’s proven execution, we are significantly expanding the scale of our solar energy platform to become a leader in California’s commercial solar industry, especially within the fast growing agricultural sector.”
Aleo Solar is supplying the SUNfarming solar park in Mecklenburg in Germany with 26,000 modules for a solar park with a total output of 6.75MW. The SUNfarming Group is the project developer and investment controller for the new project.
Hanwha Q Cells has agreed to build 50MW of PV in India and 28.6MW in the Philippines, according to South Korean media reports. The solar panel maker will team up with with New Delhi-based developer Azure Power to install 50MW in the Indian state of Andhra Pradesh by next March, according to the Yonhap news agency. Separately, Seoul-based Hanwha has also agreed to jointly develop 28.6MW on the island of Mindanao with Belgian PV integrator Enfinity.
A subsidiary of Shunfeng International Clean Energy, meteocontrol China, will provide remote control systems for the first 100MW- phase of a solar PV project in Pakistan to be developed by investment company Zonergy. As part of the agreement, meteocontrol will offer data acquisition devices, sensor and portal software, along with related configuration, commissioning and training services, as well as operation and maintenance solutions. Once completed, the installation is estimated to stand as the largest single PV power project in Pakistan, at 900MW.
Banks Renewables has submitted an application to the Rotherham Metropolitan Borough Council for a 5MW solar project at its Penny Hill wind farm in South Yorkshire, England. The project forsees installing a solar photovoltaic scheme in the south east corner of the farm, operational since 2013.
Harvey Group has agreed to acquire fellow Northern Irish renewables outfit Solmatix. The solar and biomass installer said the deal “would indeed be mutually beneficial”. Solmatix will operate as an autonomous company within Harvey Group.
The European Investment Bank (EIB) has loaned electrical systems contractor Ingeteam €55m to support its research, development and innovation activities in renewable energy. The funds will go toward advancing Ingeteam's research and development of technology for wind turbine generators, PV systems and hydropower and thermal plants.The R&D will take place at the company's facilities located in Navarra and Albacete Spain. This is the second such EIB loan granted to Ingeteam.
JinkoSolar has supplied PV modules for a 1MW floating solar project in western Japan. Daiwa Lease completed the $4m project in Kishiwada, Osaka prefecture — its first floating solar array — earlier this month.
A unit of Kyocera has agreed to supply 3.2MW (DC) of PV modules for a street-lighting project in Brazil. The Japanese group is working with Brazilian engineering firm Soter to install solar-powered lighting along 73km of highway in Rio de Janeiro. The Arco Metropolitano do Rio de Janeiro project — which the local authorities are funding — will feature more than 4,300 solar streetlights. It is expected to generate roughly 2.8GWh of electricity per year.
Wircon has begun work on its 60MW solar plant near Copenhagen, Denmark, the biggest PV plant in Scandinavia. The project will consist of 239,000 solar modules from Astroenergy, which belongs to China Chint Group, and is also includes 1,700 inverters from German PV systems firm SMA. The solar park is due to be completed by the end of November 2015 and connected to the grid this year, the German-based PV developer said.
Isolux Corsan has delivered its 61.48MW PV solar project in Honduras on a budget of nearly $100m, the developer’s fist in the country. The Aura II plant, located in the region of Choluteca, is now operational after only 7 months, Isolux said. The project has been supported by private investments from Mexico and Honduras, as well as finance from the International Finance Corporation (IFC), the Mexican bank Bancomext, and the German development agency DEG.
Link: http://www.rechargenews.com/incoming/1408212/solar-power-deals-and-company-news
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China Advised to Double 2020 Solar-Power Goal
Aug 12, 2015 | BNA Daily Environment Report
China is being encouraged by three industry groups to double the nation's solar-power goal for 2020 to fill a gap forecast to emerge because nuclear and hydropower are due to fall short of targets.
The world's biggest solar market needs 200 gigawatts of such capacity by then, according to a document made available to Bloomberg.
The China Photovoltaic Industry Association, Chinese Renewable Energy Industries Association and China Renewable Energy Society, which act as conduits between the government and industry, jointly wrote the document and advised the energy authority in the State Council.
China's hydropower additions have been sluggish in recent years, given constraints of natural resources, according to the document. Burgeoning wind and solar power should be used to fill needs created by lagged nuclear and hydropower capacity, the groups said.
The advice, if accepted, would boost solar installations sixfold, spurring demand for manufacturers including Trina Solar Ltd. and Yingli Green Energy Holding Co. China had about 33 gigawatts of solar power at the end of 2014, according to Bloomberg New Energy Finance data.
The nation intends to get 15 percent of all energy from renewables and nuclear power by 2020, up from 11 percent last year. For 2015, China plans to add about 18 gigawatts of solar power capacity, almost equal to all the generating capacity available in the U.S. at the end of 2014.
The current technology can't guarantee the nuclear power projects are safe, and the cycle of planning and construction is long, the groups said in the document. If no breakthrough occurs in the short term, it will be hard to achieve the goal of 58 gigawatts in nuclear power installations by 2020, they said.
The world's biggest energy consumer got about a tenth of its primary energy from nonfossil fuels including renewables and nuclear in 2013, the National Energy Administration said on Dec. 31.
Link (subscription needed): http://news.bna.com/deln/DELNWB/split_display.adp?fedfid=74212492&vname=dennotallissues&fn=74212492&jd=74212492
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Australia pledges emissions cut
Aug 11, 2015 | The Hill - E2 Wire
By Timothy Cama
Australia’s government on Tuesday announced a pledge to cut greenhouse gas emissions 26 to 28 percent by 2030 as part of a United Nations agreement to stop climate change.
The pledge, which uses 2005 emissions as a baseline, puts Australia behind other major nations and well short of the cuts needed to keep global warming under 2 degrees Celsius above pre-industrial levels, a target believed to prevent the most catastrophic effects of warming.
“We’ve got to reduce our emissions but we’ve got to reduce our emissions in ways which are consistent with continued strong growth,” conservative Prime Minister Tony Abbott told reporters Tuesday, according to The Sydney Morning Herald.
“The last thing we want to do is strengthen the environment and at the same time damage our economy,” he said.
“What we have done is crafted a position for Australia which shows that we [do] our fair share, we do the right thing by the planet, we also do the right thing by families,” said Environment Minister Greg Hunt.
The government felt that the target is something it can successfully sell both at home and abroad, The Herald said.
International eyes are on Australia as the last major developed country that had not submitted a national pledge to the U.N. as part of its climate negotiations, which are set to wrap up with a formal agreement in December in Paris.
Environmentalists immediately slammed the Australian pledge, saying it does not go far enough.
“Australia’s weak climate proposal is out of step with the global community,” said David Waskow, international climate director with the World Resources Institute. “The country is falling further behind its peers with this unfortunate stance on climate change.”
“The prime minister was out on Sunday crowing about per capita pollution reductions, but these numbers would leave us still with the highest per capita pollution figures in 2030,” said John Connor, CEO of The Climate Institute.
In the United States, President Obama has also made a pledge of a 26 to 28 percent reduction, though that would come by 2025, five years earlier than in Australia.
Even Canada, which has a similar economy to Australia’s and was roundly criticized for its pledge, promised more reductions, with a 30 percent cut by 2030.
The European Union, meanwhile, pledged a 40 percent cut under 1990 levels.
Abbott has been the subject of frequent criticism by environmentalists. He led his party last year to end Australia’s tax on carbon dioxide emissions, the first time a country has repealed such a levy.
Link: http://thehill.com/policy/energy-environment/250803-australia-pledges-26-28-percent-emissions-cut
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China Energy Intensity, Consumption Continue Decline
Aug 12, 2015 | BNA Daily Environment Report
By Michael Standaert
China's consumption of energy per unit of gross domestic product generated dropped by 5.9 percent for the first half of 2015 compared to the same period a year before, as the country continues to adjust the structure of its economy away from heavy industry.
Electricity consumption in heavy industries such as coke, caustic soda, cement and plate glass production fell 3.4 percent, 1.9 percent, 5.3 percent and 4.2 percent, respectively, in the first half compared to the same period last year, according to Aug. 11 state-media reports about a National Development and Reform Commission (NDRC) notice.
Energy use efficiency also improved, with coal-fired power plants achieving a rate of 319 grams of coal per kilowatt-hour generated, bypassing an early target of 325 grams per kilowatt-hour the nation expected to achieve by the end of the year.
Overall coal consumption declined 5.8 percent compared to the same period last year. Consumption of coal in the wealthy province of Zhejiang in eastern coastal China around Shanghai dropped more than 8 percent from a year earlier in one example given by the NDRC of dropping coal use.
Nuclear and wind power capacity increased markedly, 24.5 percent and 26.8 percent respectively, from the first half of 2014, the government said. Hydropower capacity increased 5.7 percent and coal-fired power capacity increased 6.4 percent compared to the same period, with the latter using newer, more efficient technology, the government said.
While the consumption of energy per unit of GDP is a measure of the country's energy intensity, overall energy consumption also dropped slightly—by 0.9 percent compared to the first half of 2014. But energy consumption from service industries grew by 8.1 percent in the first half of this year compared to that period.
Link (subscription needed): http://news.bna.com/deln/DELNWB/split_display.adp?fedfid=74212501&vname=dennotallissues&fn=74212501&jd=74212501
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New Zealand puts bets on diverse energy mix
Aug 12, 2015 | UPI
By Daniel J. Graeber
Boasting of more spending by oil and gas explorers and increased renewable energy output, New Zealand's government said the right mix is good for the long term.
A federal government report published Wednesday finds renewable energy made up 39.5 percent of the nation's total primary energy supply, a measure of total domestic energy use.
"It's a fantastic result and shows we are making real gains in transitioning to a lower carbon economy," New Zealand Energy Minister Simon Bridges said in a statement.
The government has credited the rise in domestic renewable energy use to the growth in geothermal generation, which more than doubled nationally in the last decade. The sector is expected to draw $7 trillion in private sector investments by 2030. In the past six years, investments in New Zealand have totaled $1.5 billion.
While Bridges said the renewable energy sector is drawing interest from potential investors, he said latest government data show oil and gas explorers spend more than $2 billion in the country last year, the highest level on record.
In April, the government offered a combined acreage 165,752 acres up for auction to oil and gas explorers, with most of that offshore. The minister said there's been "serious momentum" building behind the government's oil and gas exploration sector.
"As the world transitions to a low carbon future, energy diversity is the key to achieving energy security, accessibility and affordability, and environmental sustainability," he said. "This is why this government takes a long-term view, with a mixed and balanced approach where we'll pursue opportunities in both renewable and non-renewable energy."
Last week, utility company Genesis Energy said it's on pace to shut down its last two coal-fired power plants by December 2018, effectively marking the end of coal power in New Zealand.
Link: http://www.upi.com/Business_News/Energy-Resources/2015/08/12/New-Zealand-puts-bets-on-diverse-energy-mix/4101439372464/
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Iran And Spain Sign Agreement For Cooperation On Renewable Energy
Aug 12, 2015 | Clean Technica
By Smiti Mittal
With the isolation of Iran expected to end following a landmark deal on the country’s nuclear program, countries across the world are looking to enhance cooperation with the Islamic republic.
Spain has signed an agreement with Iran to boost cooperation in Iran’s renewable energy industry, and will extend technical cooperation in designing and manufacture of renewable energy equipment.
The agreement was signed between Iran’s Sunir (an exporter of electrical equipment) and Spain’s Bester (a renewable energy project developer). Bester will work as a consultant to Sunir, presumably on various technical aspects of renewable energy generation, for 18 months, and the two companies are then expected to jointly develop renewable energy projects in Iran.
Iran has been looking to increase its renewable energy capacity, and is aiming to have an installed renewable energy capacity of 5 GW by 2018, most of which would be based on wind energy technology. The Iranian government also intends to initially develop at least 500 MW of solar power. Construction on 400 MW capacity has already been started, while contracts for 900 MW worth of projects have also already been signed.
The Iranian Government is offering significant incentives to prospective project developers with high feed-in tariffs and subsidies on capital costs incurred for the development of solar power projects. Last year, Iran also signed an agreement with Azerbaijan to develop renewable energy projects. The State Agency for Renewable & Alternative Energy Sources of Azerbaijan expressed its willingness to help Iran and its project developers. An Azerbaijani company ASPI Consulting Engineers Inc had earlier participated in exploring the feasibility of implementing small hydro power projects on the Iranian coast of the Caspian Sea.
Link: http://cleantechnica.com/2015/08/12/iran-spain-sign-agreement-cooperation-renewable-energy/
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3 Reasons Why America Is Turning to Renewable Energy
Aug 12, 2015 | EcoWatch
By Tara Lohan
Deborah Lawrence had been watching a once-empty parking lot near Midland-Odessa, Texas, fill up with idled drilling rigs usually at work plumbing for oil in the nearby Permian Basin. In January she noticed 10 rigs, then 17 a few weeks later. As winter turned to spring, the number climbed to 35.
That trend has continued across the country. By the end of July, the nationwide rig count had slipped 54 percent since the same time a year ago, indicating distress in the oil and gas industry. The most obvious culprit is the precipitous drop in crude prices. But the trouble goes deeper, as Lawrence knows—and she isn’t just a casual observer. Lawrence is a former Wall Street financial consultant who now runs the Energy Policy Forum, helping to identify and analyze trends in the industry.
Right now, our fossil-fueled energy path has us on a roller-coaster ride and we are plunging, white knuckled. Production in the U.S. from the exploitation of shale oil (or tight oil), which accounts for 45 percent of the country’s oil production, will take a hit if prices continue to remain well below the $100 mark. Tens of thousands of jobs have already been cut and some debt-laden companies may go belly up.
This is the narrative that has been seizing headlines, but it’s not the whole story of what’s going on in our energy economy. While shales were booming and then busting, solar and wind have been surging. Renewables have been relegated to the sidelines of our energy priorities, a small blip in our electric generating capacity each year, but that is changing. How fast it happens could be enough to rock the boat in a major way.
The fact that we should be moving to more renewable energy and using less oil is no secret. Scientists have repeatedly warned that if we continue to burn fossil fuels with our current abandon, we risk catastrophic climate impacts, some of which we are already beginning to see. Instead, they caution, much of our oil, gas and coal reserves should stay in the ground.
But as long as fossil fuels remain cheap (ignoring externalities) and energy companies reap big profits from them, we will keep drilling and mining and burning—global catastrophe be damned.
If science and good sense aren’t enough to make us shift course, perhaps economics will. We’ve long heard that we must choose between jobs and the environment. Or between economic growth and clean energy. But more and more, it is looking like fossil fuels are the economic deadweight and renewables are finally ready for a seat at the table.
The Plunge
The U.S. boom in the production of oil and gas in the past seven years has been largely driven by horizontal drilling and hydraulic fracturing (or fracking) of rock formations known as shale plays. But the growth may not be as long-lived as advertised.
For starters, there’s good evidence to suggest that the amount of economically recoverable reserves of both shale oil and gas are not as much as previously hyped.
J. David Hughes, a geoscientist and fellow at the Post Carbon Institute, who spent 32 years with the Geological Survey of Canada, found that while short-term production of shale oil and gas is undoubtedly significant, the long-term view shows that the growth is not sustainable. His research reveals production peaking in both shale oil and gas in most of the significant plays in the U.S. by 2020.
The next problem facing the industry is the price tag of its operations. The costs to drill and complete a shale well can range from $6 million to $8 million or more a well—depending on the play and the number of drilling stages.
Production on shale wells also declines very quickly. For shale oil, the three-year average well decline rate in most major U.S. plays falls between 60 and 91 percent. Around half of all the oil that will be produced from these wells will come in the first three years. For shale gas, the three-year average well decline rate is between 74 and 82 percent.
This means that in order to maintain or increase production, you have to keep a frenetic pace of new drilling—what Lawrence Berkeley National Laboratory scientist David Fridley likened to being on an “accelerating treadmill.” The drilling frenzy that has characterized the shale boom caused a spike in production, contributing to a global glut, which has resulted in falling prices. It’s a vicious circle and one that was hard to make economical even when crude was selling for $100 a barrel.
When prices dropped earlier this year to around $50 a barrel, things became more dire for the shale industry and they haven’t greatly improved in the last six months. Despite briefly reaching around $63 a barrel in late spring, prices have fallen again. “For the past five years we’ve been told we’re going to be energy independent and we will have all this oil and we’re going to export gas to Europe and we’re going to export gas to Asia and it’s just not going to happen,” said Fridley.
Overproduction, combined with declining consumption, has resulted in plummeting crude prices in the past year. It’s the same script that occurred just a few years earlier, when shale gas prices bottomed out in the U.S.
So what’s the industry to do?
Investor Jeremy Grantham, the founder of GMO, a Boston-based money manager, wrote in the financial publication Barron’s, “Almost no new drilling programs will be initiated at current prices except by the financially desperate and the irrationally impatient and in three years more than 80 percent of all production from current wells will be gone.”
Given the costs of drilling and completing wells and the number needed to keep production growing, companies must have lots of cash to stay on the treadmill. And that may become harder and harder for many to do.
The Energy Policy Forum’s Lawrence has been comparing the financials of some of the industry’s top companies for years; she found that they lack free cash flow.
“They were spending a lot in capital expenditures—the money needed to drill and complete the wells,” she said. “And that was growing every year while the money they were actually making, the cash that was left over at the end of the day, was deteriorating. It was never positive.”
Lawrence crunched the numbers on more than 20 U.S. shale operators and found that the companies had been cash-flow-negative since 2009. As Alberta Oil Magazine reported, “In 2013, U.S. onshore oil producers outspent their operating cash flow by a ratio of two-to-one.”
The record-high production boom we’ve witnessed has been sustained by companies taking on high levels of debt, including $120 billion in high-risk, high-yield bonds. JPMorgan’s estimate of the default rate for these junk bonds is nearly 4 percent this year and will be a whopping 20 percent next year, if crude prices remain around $65 a barrel.
This may mean lights out for a number of debt-laden companies. Some will go out of business, while others may be gobbled up by larger corporations. Expect lots of consolidation and cherry-picking of assets by the big players. Giants like Chevron and Exxon Mobil will likely make out well, but they aren’t the only ones. “It will be fantastic for the investment banks, because they will make a fortune off of fees,” says Lawrence.
Those who won’t make out well, however, include more than just the debt-heavy industry players. It could be you. “A lot of pension funds invest in energy stocks and the energy stocks have just gotten creamed,” says Lawrence. “They haven’t had good share returns. You’re going to see that reflected in your portfolio.”
Despite the bad news on shales, Lawrence sees a lot of good economic news when it comes to renewable energy.
“I have this feeling that we are on the cusp of a new energy paradigm and things are changing so rapidly,” says Lawrence. “I think you’re going to see a lot of disruption in the next five to 10 years and I don’t think the oil and gas industry really thinks it’s coming.”
Install, Baby, Install
In March the Texas city of Georgetown announced plans to ditch gas and coal for electricity generation in favor of wind and solar. The city’s spokesperson told the press it was “primarily a price decision” and the Texas Tribune reported that the switch allowed Georgetown to “lock in cheaper electricity” and “hedge against any future spikes in coal or natural gas prices.”
If you don’t closely track the energy markets, you may be surprised to know that generating electricity from wind and solar is cost competitive in some places in the U.S. already—and getting close in many others. Globally, renewables could even become the top source of electricity in just 15 years, according to a new report by the International Energy Agency.
Renewables still account for a small percentage of overall U.S. electricity generation—13 percent for all renewables, with wind at 4.4 percent and utility-scale solar at less than 1 percent. But some states are showing that much greater exploitation of renewables is indeed possible. Iowa got 27 percent of its total electricity from wind in 2013 and last year California became the first state to get more than 5 percent of its electricity from utility-scale solar.
In the past seven years, wind and solar capacity in the U.S. has tripled and new capacity has favored renewables. In 2014 wind and solar made up 55 percent of new electric generating capacity in the U.S. By comparison, natural gas was 42 percent. The other new sources—coal, nuclear and oil—were all under 1 percent.
Currently, the federal government allows a 30 percent investment tax credit for solar, but it is set to expire at the end of 2016, at which point it will decline to 10 percent. A report from Deutsche Bank says that even without additional subsidies, solar is already cost competitive in 14 states. If the credit is renewed and costs for solar continue to fall as predicted, then we could see solar electricity as cheap as average electricity bill prices in 47 states within the next two years, according to Deutsche Bank’s report. If the credit is not renewed, we could still see 36 states at grid parity.
“Gone are the days when solar panels were an exotic plaything of Earth-loving rich people,” Tom Randall writes for Bloomberg Business. “Solar is becoming mainstream.”
One of the things driving that growth is that costs are falling and the products are getting better. Solar and wind, points out Lawrence, are technologies and not fuels and as such they typically become cheaper with scale and time.
Even more promising, while prices are declining in these industries, the number of people employed has skyrocketed. The Solar Foundation reports that jobs in the solar industry grew by 86 percent in the past five years. As of 2013, according to industry estimates, there were 143,000 solar jobs and more than 50,000 in wind in the U.S.
For wind and solar, falling prices means more jobs. Lawrence likens it to what economists call a virtuous circle: “A recurring cycle of events, the result of each one being to increase the beneficial effect of the next.”
It’s the exact opposite of the shale industry’s vicious circle, where high production results in plunging prices, followed by thousands of layoffs.
“The self-styled ‘shale revolution’ was built on the back of very expensive oil and gas prices,” writes Lawrence. “Shales need very high prices to work. While high prices are great for oil and gas balance sheets, they cannot help but translate into more expensive products and services overall in the economy. It does not benefit all. It benefits only a few.”
The Path Forward
While there are a lot of reasons to be optimistic about future prospects for renewables, we have a long way to go and it’s not smooth sailing by any stretch. We’re talking about disrupting a system where the entrenched interests are some of the wealthiest companies in the world.
In the U.S., the best way to aid continued growth for renewables, the industry says, is to lock in federal support that investors and businesses can count on. The investment tax credit for solar that Congress can renew at the end 2016 is one example. For wind it’s the production tax credit (PTC), which dates back to 1992. In the past 23 years Congress has let the PTC expire a total of six times and has also elected to renew it six times. The results, as you can imagine, were a series of ups and downs for wind installation. “Industry needs confidence,” said Tom Kiernan, the CEO the American Wind Energy Association. “It needs multi-year extensions for as long as possible.”
There are other hurdles. Conservative groups like the American Legislative Exchange Council (ALEC) have helped launch attacks against state-level regulations such as the Renewable Energy Standards. In the last few years more than a dozen state-level bills have been introduced attacking those standards, but so far Ohio has been the only state to sign one into law. More successful at discouraging the growth of renewables have been utilities like Pella Electric Cooperative in Iowa, which will start tacking $85 a month to the bills of homeowners who install solar or wind systems. In Arizona, fees for homeowners installing solar may rise from $5 to $21 a month, although the utility (Arizona Public Service) originally proposed a hike as high as $100 a month.
At the most basic level, the country has yet to go all in on a commitment to supporting renewables, but economics may just push us there anyway. A new report from Citigroup dismissed ideas that cheap oil prices would negatively impact renewables, arguing instead said that a combination of “economic competitiveness, energy security and environmental goals” would quickly drive the global push for more renewables.
The price volatility in the oil and gas market is not going away anytime soon. And coal, still the biggest sources of U.S. electricity generation overall, has suffered a one-two punch from natural gas and renewables. From 2010 to 2014, coal’s net generation of electricity fell by 14 percent. The U.S. coal industry is now deemed in “structural decline” and there doesn’t seem to be any way up.
Coal’s fall and the oil industry’s latest stumble with shales reveal more cracks in the fossil-fuel industry’s once impenetrable wall of dominance. But the biggest threat to the industry will likely come soon, as the global community gets serious about tackling climate change. Our future energy plans will be contingent on how this plays out politically and economically.
The fossil-fuel divestment movement is gaining strength and the idea of “stranded assets” is moving closer to economic reality. In March, the Bank of England warned insurers that policy changes addressing climate change could threaten investments in fossil fuels. And MSCI, one of the world’s top stock-market index companies, reported that investors who have divested from coal, oil and gas over the past five years are now outperforming those who haven’t.
“Climate change can no longer be discounted in any future energy business model,” writes author and resource expert Michael Klare. “Whether Big Oil is ready to admit it or not, alternative energy is now on the planetary agenda and there’s no turning back from that.”
This December, when international climate talks resume in Paris for the next installment of the United Nations Climate Change conference, we will see just how serious governments really are about commitments to reducing greenhouse gas emissions. This year, at least, the U.S. is willing to play. The Obama administration has already noted that Washington has a plan to reduce emissions up to 28 percent below 2005 levels in the next 10 years.
From a scientific standpoint, the results from Paris may be too little, too late, even if big polluters like the U.S. can make good on new commitments. And political will is only one part of the puzzle. Numerous voices have called for a rethinking of our cultural and economic norms that drive perpetual growth.
“Because of our endless procrastination, we also have to pull off this massive transformation without delay,” writes author Naomi Klein in her newest book, This Changes Everything. “Is it possible? Absolutely. Is it possible without challenging the fundamental logic of deregulated capitalism? Not a chance.”
Fridley, the scientist from Lawrence Berkeley National Laboratory, has also called for a deeper conversation on what a path to renewables would look like. Most of the focus has been on how to use renewables to fill our electricity needs, but this is just the tip of the iceberg when it comes to all the energy we use in our highly industrialized lives.
Globally, electricity accounts for only about 20 percent of our final energy consumption, says Fridley and even if we hit 50 percent renewables for electricity, we still have only addressed about 10 percent of how much energy the world consumes.
“Yes, we can have a renewable world, but it’s not really going to look like the world we have today,” says Fridley. “It could be a better world to live in, it could be a much worse world to live in, depending on many of the decisions we make in the next decade or two.”
In the past seven years, wind and solar capacity in the U.S. has tripled and new capacity has favored renewables. In 2014 wind and solar made up 55 percent of new electric generating capacity in the U.S. By comparison, natural gas was 42 percent. The other new sources—coal, nuclear and oil—were all under 1 percent.
Currently, the federal government allows a 30 percent investment tax credit for solar, but it is set to expire at the end of 2016, at which point it will decline to 10 percent. A report from Deutsche Bank says that even without additional subsidies, solar is already cost competitive in 14 states. If the credit is renewed and costs for solar continue to fall as predicted, then we could see solar electricity as cheap as average electricity bill prices in 47 states within the next two years, according to Deutsche Bank’s report. If the credit is not renewed, we could still see 36 states at grid parity.
“Gone are the days when solar panels were an exotic plaything of Earth-loving rich people,” Tom Randall writes for Bloomberg Business. “Solar is becoming mainstream.”
One of the things driving that growth is that costs are falling and the products are getting better. Solar and wind, points out Lawrence, are technologies and not fuels and as such they typically become cheaper with scale and time.
Even more promising, while prices are declining in these industries, the number of people employed has skyrocketed. The Solar Foundation reports that jobs in the solar industry grew by 86 percent in the past five years. As of 2013, according to industry estimates, there were 143,000 solar jobs and more than 50,000 in wind in the U.S.
For wind and solar, falling prices means more jobs. Lawrence likens it to what economists call a virtuous circle: “A recurring cycle of events, the result of each one being to increase the beneficial effect of the next.”
It’s the exact opposite of the shale industry’s vicious circle, where high production results in plunging prices, followed by thousands of layoffs.
“The self-styled ‘shale revolution’ was built on the back of very expensive oil and gas prices,” writes Lawrence. “Shales need very high prices to work. While high prices are great for oil and gas balance sheets, they cannot help but translate into more expensive products and services overall in the economy. It does not benefit all. It benefits only a few.”
The Path Forward
While there are a lot of reasons to be optimistic about future prospects for renewables, we have a long way to go and it’s not smooth sailing by any stretch. We’re talking about disrupting a system where the entrenched interests are some of the wealthiest companies in the world.
In the U.S., the best way to aid continued growth for renewables, the industry says, is to lock in federal support that investors and businesses can count on. The investment tax credit for solar that Congress can renew at the end 2016 is one example. For wind it’s the production tax credit (PTC), which dates back to 1992. In the past 23 years Congress has let the PTC expire a total of six times and has also elected to renew it six times. The results, as you can imagine, were a series of ups and downs for wind installation. “Industry needs confidence,” said Tom Kiernan, the CEO the American Wind Energy Association. “It needs multi-year extensions for as long as possible.”
There are other hurdles. Conservative groups like the American Legislative Exchange Council (ALEC) have helped launch attacks against state-level regulations such as the Renewable Energy Standards. In the last few years more than a dozen state-level bills have been introduced attacking those standards, but so far Ohio has been the only state to sign one into law. More successful at discouraging the growth of renewables have been utilities like Pella Electric Cooperative in Iowa, which will start tacking $85 a month to the bills of homeowners who install solar or wind systems. In Arizona, fees for homeowners installing solar may rise from $5 to $21 a month, although the utility (Arizona Public Service) originally proposed a hike as high as $100 a month.
At the most basic level, the country has yet to go all in on a commitment to supporting renewables, but economics may just push us there anyway. A new report from Citigroup dismissed ideas that cheap oil prices would negatively impact renewables, arguing instead said that a combination of “economic competitiveness, energy security and environmental goals” would quickly drive the global push for more renewables.
The price volatility in the oil and gas market is not going away anytime soon. And coal, still the biggest sources of U.S. electricity generation overall, has suffered a one-two punch from natural gas and renewables. From 2010 to 2014, coal’s net generation of electricity fell by 14 percent. The U.S. coal industry is now deemed in “structural decline” and there doesn’t seem to be any way up.
Coal’s fall and the oil industry’s latest stumble with shales reveal more cracks in the fossil-fuel industry’s once impenetrable wall of dominance. But the biggest threat to the industry will likely come soon, as the global community gets serious about tackling climate change. Our future energy plans will be contingent on how this plays out politically and economically.
The fossil-fuel divestment movement is gaining strength and the idea of “stranded assets” is moving closer to economic reality. In March, the Bank of England warned insurers that policy changes addressing climate change could threaten investments in fossil fuels. And MSCI, one of the world’s top stock-market index companies, reported that investors who have divested from coal, oil and gas over the past five years are now outperforming those who haven’t.
“Climate change can no longer be discounted in any future energy business model,” writes author and resource expert Michael Klare. “Whether Big Oil is ready to admit it or not, alternative energy is now on the planetary agenda and there’s no turning back from that.”
This December, when international climate talks resume in Paris for the next installment of the United Nations Climate Change conference, we will see just how serious governments really are about commitments to reducing greenhouse gas emissions. This year, at least, the U.S. is willing to play. The Obama administration has already noted that Washington has a plan to reduce emissions up to 28 percent below 2005 levels in the next 10 years.
From a scientific standpoint, the results from Paris may be too little, too late, even if big polluters like the U.S. can make good on new commitments. And political will is only one part of the puzzle. Numerous voices have called for a rethinking of our cultural and economic norms that drive perpetual growth.
“Because of our endless procrastination, we also have to pull off this massive transformation without delay,” writes author Naomi Klein in her newest book, This Changes Everything. “Is it possible? Absolutely. Is it possible without challenging the fundamental logic of deregulated capitalism? Not a chance.”
Fridley, the scientist from Lawrence Berkeley National Laboratory, has also called for a deeper conversation on what a path to renewables would look like. Most of the focus has been on how to use renewables to fill our electricity needs, but this is just the tip of the iceberg when it comes to all the energy we use in our highly industrialized lives.
Globally, electricity accounts for only about 20 percent of our final energy consumption, says Fridley and even if we hit 50 percent renewables for electricity, we still have only addressed about 10 percent of how much energy the world consumes.
“Yes, we can have a renewable world, but it’s not really going to look like the world we have today,” says Fridley. “It could be a better world to live in, it could be a much worse world to live in, depending on many of the decisions we make in the next decade or two.”
Link: https://ecowatch.com/2015/08/11/america-turning-to-renewables/
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Chile Mines Turn to Renewable Energy
Aug 11, 2015 | The Wall Street Journal
By Ryan Dube
The three industrial boilers at the state-owned Codelco mine high in the mountains here once consumed 67,000 barrels of diesel a year to turn out shiny copper sheets for export. Now, the job is powered by nearly 3,000 solar panels that take advantage of the Atacama Desert’s cloudless blue sky.
As the cost of solar and wind power declines, renewable energy has become increasingly attractive to power-hungry mining companies. Nowhere, though, is it more prevalent than in resource-rich Chile, where companies have been pioneering alternatives to conventional power after years of shouldering some of the world’s highest energy costs.
Here at the Codelco mine, named after the late Chilean poet Gabriela Mistral, a thermosolar plant run by Chile’s Energia Llaima SpA and Denmark’s Arcon-Sunmark has replaced about 80% of the diesel that Codelco previously trucked up 8,700 feet to the mine. Copper produced by Corporación Nacional del Cobre de Chile, or Codelco, the world’s biggest producer of the metal, goes to China and other global markets.
“This blue sky makes me happy,” said plant manager Rodrigo Aravena, as he inspected rows of panels, shining in the sun and installed over an area the size of eight football fields. “It means we are generating more, and it is much better for business.”
Ernst & Young recently estimated that mines in Latin America—a region that produces copper, iron ore, oil and coal used world-wide—will invest more than $1 billion in renewable energy projects by 2022, up from $37 million in 2013. Much of that development will be in this sliver of a country, which produces a third of the world’s copper.Advertisement
Electricity prices for Chilean mining companies doubled in the last decade to about $100 per megawatt hour, according to the Santiago-based Mining Council industry group, an amount that is twice as much as neighboring Peru. Chile is overly dependent on energy imports, while Peru taps a large, inexpensive domestic supply of hydropower and natural gas.
Solar- and wind-power companies say they can provide power to mines for as little as $80 per megawatt hour, still costly in Peru and other countries, but competitive in Chile.
“The scale of what is happening in Chile is currently unique in the world,” said Mike Elliott, Ernst & Young’s head mining analyst. “It’s occurring in Chile because the economics just make sense, while in many other countries it doesn’t yet make the same commercial sense.”
President Michelle Bachelet is encouraging alternatives to natural gas, coal and diesel imports, with the government aiming for 20% of total electricity capacity to come from renewables by 2025. In May, renewables could generate 2,273 megawatts in Chile, about 11% of electricity capacity, according to Cifes, a government agency that promotes sustainable energy. Last year, Chile added 982MW of renewable capacity to its power grid, compared with 244MW added in 2013.
The government’s energy agenda means mining companies need to increasingly rely on renewables. In the north power grid, about 90% of consumption comes from industry, most of which are mining companies. And the state copper commission, Cochilco, expects copper mining companies to double electricity consumption over the next 10 years, when companies are projected to invest $74 billion expanding mines or building new ones.
“Unlike in developed countries where the main driver of renewable energy development has been the reduction of greenhouse-gas emissions, that isn’t the principal driver here, but rather energy security and competitive prices,” said Fernando Hentzschel, the director of development and technology at Cifes.
Chile reconsidered its energy policies after 2004, when Argentina’s decision to curb natural-gas exports to meet its own demand caused a power crisis here. Plans for coal-fired plants and hydroelectric dams in Chile’s deeply forested south were canceled because of community opposition and protests by environmentalists. The government briefly considered nuclear energy, but shelved that option after Japan’s Fukushima meltdown in 2011.
The Atacama’s blue sky emerged as an alternative.
Solar radiation levels in the Atacama are some of the highest anywhere, making it ideal for producing solar power.
“You have to be very careful. We use sunscreen every time we go out and we always use sunglasses,” said Sebastián Carmona, Codelco’s head of external affairs at Gabriela Mistral.
Renewables still have limitations for mining companies, and few experts believe they will completely replace conventional energy soon. Companies require a steady supply of power to mine 24 hours a day, and solar and wind can be intermittent.
“If you are producing [energy] eight hours, that is an issue,” said Carlos Barrera, the Latin American vice president for SunEdison Inc., a U.S.-based firm that supplies solar power to Chilean iron-ore company Compañía de Acero del Pacífico. “With those eight hours, you can still reduce the cost of mining in a big way, but obviously that is not the full solution required.”
At Gabriela Mistral, Codelco still uses diesel when it needs extra power for generating heat at night, when temperatures in the Atacama can drop below freezing.
Other mines are trying both wind and solar to provide a more stable energy supply. Last year, Antofagasta Minerals ’ Los Pelambres copper mine began receiving about 20% of its power from 50 wind turbines operated nearby by California-based Pattern Energy Group Inc. Antofagasta now plans to receive solar power from SunEdison.
“A lot of times the stronger winds are not when it is the peak sunny times,” said Hunter Armistead, Pattern’s vice president of business development. “If you add the two types of generation profiles together, you end up with a much more stable profile of generation for selling that to the mine.”
Indeed, here in southern Chile, winds can be so strong that they can overpower and even shut down turbines, said Dominic Duffy, the chief operating officer of Mandalay Resources Corp., which will start receiving power from a wind farm this year at its Cerro Bayo mine in the Patagonia region.
“The wind is constant, all-year round,” he said. “It’s good we aren’t the first doing this project as we’ve seen the issues of having too strong wind conditions.”
Link: http://www.wsj.com/articles/chile-mines-turn-to-renewable-energy-1439337896
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