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SFCE Sept 23
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Financial support fades for US shale oil drillers
Sep 23, 2015 | Financial Times
By Gregory Meyer and Ed Crooks
Marathon Oil has been at the vanguard of the US shale drilling revolution. Year after year it reported double-digit gains in crude lifted from North Dakota’s Bakken, Texas’s Eagle Ford and other hotbed regions. Now, those heady days are over. -
‘Inconceivable’ Paris won’t deliver climate pact, says UNEP chief
Sep 23, 2015 | Climate Change News
By Megan Darby
World leaders need to tell their negotiators on a global climate deal to shift positions and compromise ahead of a critical Paris summit in December. That is the view of Achim Steiner, director of the UN Environment Programme (UNEP), as heads of state meet in New York this week. -
Brace Yourself For Same-Day Rooftop Solar, SolarCity Joins Race To Cut Costs
Sep 23, 2015 | Clean Technica
By Tina Casey
Last week the US Energy Department tapped five teams to compete in the new SunShot “Race to 7-Day Solar” prize. The friendly competition is aimed at making rooftop solar installation faster and cheaper, like installing a new furnace or any other major appliance. It happens that one of the teams includes US solar giant SolarCity, which is chaired by Tesla CEO and chairman Elon Musk, and knowing our Elon it’s not a surprise to learn that his team intends to blow past the seven-day goal and get everything done in one day — or less. -
India's energy mix to have 40% renewable sources by 2030
Sep 23, 2015 | Business Standard
By Nitin Sethi
At least 40 per cent of India's total power capacity will come from renewable sources by 2030. The decision to substantially alter the energy mix that powers India in future is likely to be taken at the Union Cabinet meeting on Wednesday when the National Democratic Alliance (NDA) government decides the country's targets for the Paris climate change agreement.
Industry News
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Financial support fades for US shale oil drillers
Sep 23, 2015 | Financial Times
By Gregory Meyer and Ed Crooks
Marathon Oil has been at the vanguard of the US shale drilling revolution. Year after year it reported double-digit gains in crude lifted from North Dakota’s Bakken, Texas’s Eagle Ford and other hotbed regions.
Now, those heady days are over.
“Our focus, as we navigate the volatile environment and progress through the planning cycle, will be capital discipline and balance sheet strength, not production growth,” Lee Tillman, Marathon’s chief executive, told an investor conference this month.
The collapse of oil prices has turned the attention of producers towards survival. As they conserve cash, US crude oil production volumes are finally heading lower. The government has revealed domestic output peaked in April and forecasts that US production will be down by 400,000 barrels per day next year.
The decisive contraction illustrates how Opec’s decision to fight for share in the world oil market is beginning to draw blood. The US is feeling particular pain, as drillers reliant on a steady flow of capital are seeing it dry up. How companies respond will help determine the speed at which an oversupplied market finds balance.
The decline in US oil production has lagged behind crude prices. West Texas Intermediate, the US oil benchmark, first tumbled below $100 a barrel in July 2014. The slide became a rout by autumn.
But the number of rigs drilling for US oil did not start to decline in earnest until five months later, according to Baker Hughes, the oilfield services company. Production reached a 44-year high of 9.6m b/d in April, according to the Energy Information Administration.
Since then supply has shrunk across the country, with only the Permian Basin of Texas still growing. “It’s pretty much across the board,” says John Staub of EIA.
US exploration and production (E&P) companies were able to keep drilling early in the slump thanks to investors eager to provide capital. With crude below $50, that support is evaporating.
E&P companies raised $9.1bn from bond issues in the first quarter of the year and $10.3bn in the second quarter, but just $1.7bn in total in July and August, according to Dealogic.
The next tightening of financial conditions is approaching fast in the shape of redeterminations of E&P companies’ borrowing bases: the limits on bank lending, based on the estimated value of the companies’ oil and gas reserves.
Although banks take their own views on the outlook for oil prices, they use the futures market as a reference point, and since the last round of borrowing base redeterminations in March and April forward prices have dropped sharply.
Front-month WTI crude is down about $4 per barrel since the beginning of March, but oil for delivery in December 2016 has dropped $11, from about $63 to $52. That downward shift in the futures curve will drag down banks’ valuations of all oil assets.
A recent survey of oil industry executives, advisers and financiers by Haynes and Boone, the law firm, found that on average they expected borrowing bases to be cut by 39 per cent this autumn.
The impact of the squeeze can be seen in several E&P companies that have cut their capital spending plans for the year since the round of second-quarter results statements over the summer.
For example Continental Resources, one of the pioneers of shale oil production, said earlier this month that it was reducing planned capital spending by about 12 per cent “to better align spending with cash flow at current commodity prices”. It is stepping down from running 10 rigs to eight in the Bakken.
That cut will affect Continental’s production. For the year as a whole, it still expects its average output to be 19-23 per cent higher than last year. But by the end of the year, it only expects to be producing up to 8 per cent more than the 200,000 barrels of oil equivalent per day than it reported for the end of 2014.
The response of producers will vary relative to their size and financial strength and the quality of their assets. Citigroup analysts note that even if a producer files for bankruptcy protection, its best fields may keep flowing as creditors seek to maintain cash flows during restructuring.
Another wild card is what happens to hundreds of thousands of US “stripper wells,” marginal operations that extract an average 2 b/d from holes drilled decades ago. Citi estimates about 300,000 b/d of stripper well output may disappear this year.
www.ft.com/intl/cms/s/0/219ad9da-6174-11e5-a28b-50226830d644.html?ftcamp=published_links%2Frss%2Fcompanies_oil-gas%2Ffeed%2F%2Fproduct#axzz3mYBV9mSB
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‘Inconceivable’ Paris won’t deliver climate pact, says UNEP chief
Sep 23, 2015 | Climate Change News
By Megan Darby
World leaders need to tell their negotiators on a global climate deal to shift positions and compromise ahead of a critical Paris summit in December.
That is the view of Achim Steiner, director of the UN Environment Programme (UNEP), as heads of state meet in New York this week.
Ban Ki-moon, UN secretary general, is holding a closed-door meeting with 40 presidents and prime ministers of big emitting economies on Sunday.
He is “perhaps the most important driver right now” of high-level efforts to secure an elusive carbon-cutting pact, Steiner told Climate Home.
“We cannot continue to have bilateral announcements and commitments and yet the instructions to the negotiators remain unchanged.
“The heads of state and governments in the next few weeks have an enormous responsibility. That is why the role of the secretary general is critical.”
Nearly 200 countries are aiming to finalise a framework for slashing greenhouse gas emissions and protecting people from the impacts of climate change in Paris.
Talks have for years been bogged down in political divisions between rich and poor, oil-producing and vulnerable states.
In recent months, ministers have found common ground on some of the contentious topics, in informal settings such as the Major Economies Forum.
Yet participants have warned the technical process is lagging behind, as negotiators grapple with the sheer complexity of drafting a text.
It is “almost inconceivable” that the Paris meeting will not result in a deal, Steiner said. “What will remain challenging is whether that outcome will add up to a sufficiently robust framework for action.”
While his UN colleague Christiana Figueres is heading up the talks themselves, Steiner’s department is busily producing research to inform and boost the process.
There are assessments of the “emissions gap” and “adaptation gap”, which look at the difference between policies and need.
Last time countries tried – unsuccessfully – to strike a deal, 2009 in Copenhagen, they did agree to try and limit global warming to 2C above pre-industrial levels.
So far, more than 60 countries covering two thirds of global emissions have submittednational contributions to that effort.
But analysts say those plans will not deliver the carbon cuts needed to meet the 2C goal.
The level of participation has been “quite remarkable,” Steiner said. “Even though people will rightly note that the gap remains significant, we do have the emergence of a universal, collective approach to dealing with the mitigation challenge.”
It is also important to make adaptation – coping with the impacts of a warming planet – a core part of the deal, he added.
Many developing countries have committed to emissions curbs for the first time – subject to financial and technical support.
In the past year, UNEP has focused on the financial sector and how it can direct funds to low carbon infrastructure and technology.
Steiner said: “Without a quantum leap forward in investment in the transition, countries will not only not be able to implement their mitigation commitments but will actually fail to be able to make climate change part of an economic and development agenda.”
In negotiations, the spotlight has been on a promise by rich countries to mobilise US$100 billion of climate finance a year by 2020.
“The world is struggling right now in constructing this equation of where the finance will come from,” said Steiner.
Many looked to a finance for development summit in Addis Ababa this summer to help unlock those flows.
Analysis: ‘Job started’ in Addis but more development cash needed
It wasn’t quite the transformative event some hoped for, but it had a “sufficiently credible outcome,” Steiner said.
“Addis created opportunities to work towards a Paris outcome, but Addis did not provide an answer in itself as to how Paris could mobilise the $100bn and shift to low carbon investment.”
That $100bn is “a critical test” for Paris, but “will one day be seen as a relatively small amount of money”.
The bigger picture is how institutional investors channel cash in the next few decades.
A study released by UNEP this month made the case for pension funds to see sustainable investment as part of their “fiduciary duty”.
“The traditional orthodoxy for pension fund managers was focused purely on a narrow definition of securing the savings of their members,” explained Steiner.
“What we have seen in recent years is a broadening of that responsibility.”
Now, progressive institutions are considering the financial and environmental risks of a high carbon portfolio.
If the world is to avoid 2C warming, scientists calculate roughly two thirds of known fossil fuel reserves need to stay in the ground.
That makes coal, oil and gas exploration – particularly from expensive sources like the Arctic – a gamble. Either the climate will suffer or shareholder returns.
A growing number of universities, faith groups and charitable funds are divesting from fossil fuels in protest at their climate impact.
The biggest signal to date has been from Norway’s US$900 billion sovereign wealth fund, which pulled out of coal holdings.
Steiner spoke at a recent divestment conference organised by activists in Paris, although he stressed UNEP wasn’t advocating such action.
“Divestment is another expression of impatience and frustration with how our economic system is responding to the need to invest in other options,” he said.
“Many have been surprised at the pace and scale at which it has started to impact on the public debate.
“It is a classic case of how citizens can get toward a sense of driving the agenda.”
Steiner is a contender for the top UN job when Ban Ki-moon’s term ends next year.
He declined to comment on a potential bid. “What comes in the future is written in the stars.”
www.climatechangenews.com/2015/09/23/inconceivable-paris-wont-deliver-climate-pact-says-unep-chief/
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Brace Yourself For Same-Day Rooftop Solar, SolarCity Joins Race To Cut Costs
Sep 23, 2015 | Clean Technica
By Tina Casey
Last week the US Energy Department tapped five teams to compete in the new SunShot “Race to 7-Day Solar” prize. The friendly competition is aimed at making rooftop solar installation faster and cheaper, like installing a new furnace or any other major appliance. It happens that one of the teams includes US solar giant SolarCity, which is chaired by Tesla CEO and chairman Elon Musk, and knowing our Elon it’s not a surprise to learn that his team intends to blow past the seven-day goal and get everything done in one day — or less.
Heavy Hitters Line Up For Same-Day Rooftop Solar
A one-day installation seems downright incredible given today’s patchwork of permits and inspections, where the permitting process for rooftop solar systems can extend for weeks and even months. However, take a look the folks lined up with SolarCity on the teamed called “Northern and Central California SunShot Alliance” and you’ll see why they are confident that they can meet, or even beat, their self-imposed one day rooftop solar goal.
The team is spearheaded by the California utility PG&E (Pacific Gas and Electric Company). PG&E is already deeply embedded in its home state’s renewable energy drive and claims that it has “helped customers connect more solar systems than any other utility in the country.” If you’re looking for numbers to back that up, last March the company summed up its solar record:
[PG&E] has reached a significant milestone by connecting the 150,000th solar customer to its electric grid. In addition, during 2014, the utility connected more rooftop solar customers to its grid than any other year in its history. More than 45,000 new solar customers were added in 2014 alone. During this time period, PG&E added approximately 326 MW of installed solar power – enough to power more than 70,000 homes.
On average, the company is connecting about 4,000 new solar customers per month across Northern and Central California, more than any other energy company in the nation. Approximately every 11 minutes, PG&E connects a new solar customer to its electric grid.
Okay, so there’s your connection experience. On the installation side, SolarCity needs no introduction if you know who Elon Musk is. SolarCity has already amassed an impressive record for rooftop solar installations. The company has also formed some interesting partnerships to motivate solar adoption and it is following the “gigafactory” model of sister company Tesla Motors with a foray into large scale solar module manufacturing.
Rounding out the team is a software company called Accela, which specializes in civic engagement platforms with a focus on speeding up cumbersome processes that fall under municipal jurisdiction, and another software company called Qado Energy. If Qado Energydoesn’t ring a bell. join the club, though the company did pop up on the CleanTechnica’s radar back in 2012 when it nailed a $500,000 slice out of a $10 million Energy Department grant for 10 solar startups. Qado was tasked to do this:
Qado is working to provide utilities and distributed generation developers a new decision support platform that enables them to quickly assess the technical impacts and commercial benefits of deploying distributed energy resources onto the grid.
Qado certainly didn’t let the grass grow under its feet. In 2014 it launched its proprietary GridUnity platform, a cloud-based system that uses a visualization interface to simplify advanced analytics for ease of use.
Back in 2014, Qado founder Brian Fitzsimons provided a description that hints at how Qado will interact with the rest of its team:
The future of achieving an efficient energy supply in the United States is in bringing together skill sets that are currently siloed within utilities with those of external stakeholders. Engineers who understand the grid need to be working with team members who understand the economic future of the grid…
…The current approach is too expensive – we need a holistic approach to incentivize utilities to adapt. If Qado is successful, utilities and their partners around the world will cost effectively evolve distributed grids to reliably accommodate high penetrations of renewables, storage, and other technologies.
Also helping the team along toward the one-day goal is its choice of venue. The team will focus like a laser on Livermore, California, which is already a leader in per capital rooftop solar thanks in part to its relatively speedy permit process.
Fierce Competition For 7-Day Rooftop Solar
To paraphrase the great Satchel Paige, our featured team better not look back, something might be gaining on them. The other four teams in the Race to 7-Day Solar are no slouches, either.
Sunrun: This team consists of Sunrun, a familiar name around the CleanTechnica table, that bills itself as “the largest dedicated residential solar company in the US.” The company will leverage its proprietary BrightPath end-to-end workflow system for the solar industry, which it just rolled out last year. BrightPath has some serious cred behind it, including $1.6 million in development funding from the Energy Department.
The Solar Auditor: This one looks interesting. The Solar Auditor is a solar shopping guide that helps consumers make informed decisions when choosing a solar installer. The company has assembled a huge team to meet the seven-day goal including a financial adviser and a home inspector as well as a raft of solar installers and other partners.
Connecticut Permit to Plug-in: This collaborative effort pairs several Connecticut municipalities with Connecticut Green Bank, investor-owned utilities, and solar contractors. Connecticut has acquired a solar-unfriendly reputation partly due to cumbersome permitting processes, so even if the team falls short of the seven-day goal it could still have a significant impact on rooftop solar sales in the state.
Midwestern Solar: This team will focus on the southeast Missouri municipalities of Poplar Bluff, Kennett, Malden, Doniphan, Columbia, and Farmington, in partnership with the Poplar Bluff and Ozark Border Electric Cooperative. As with Connecticut, Missouri is not currently among the country’s solar front runners, so anything the team can do to speed things up will count as a win.
Make That A Slugfest To 7-Day Solar
This is supposed to be a friendly competition but fireworks have already broken out between Sunrun and the Northern and Central California SunShot Alliance. Earlier this week, Sunrun called into question PG&E’s commitment to a competitive rooftop solar market under a forthcoming change in California’s net metering rules, among other issues.
No comeback yet from PG&E, so stay tuned on that.
Meanwhile, the clock is ticking. The Race to 7-Day solar starts now and keeps going until March of 2017, with the winner to be announced in June 2017. The Obama Administration has also just pumped another $102 million into other cost-cutting solar projects, so it looks like solar energy is set to continue competing with fossil energy despite the ongoing slump in petroleum, coal, and natural gas.
http://cleantechnica.com/2015/09/23/brace-day-rooftop-solar-solarcity-joins-race-cut-costs/?utm_source=dlvr.it&utm_medium=twitter
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India's energy mix to have 40% renewable sources by 2030
Sep 23, 2015 | Business Standard
By Nitin Sethi
At least 40 per cent of India's total power capacity will come from renewable sources by 2030. The decision to substantially alter the energy mix that powers India in future is likely to be taken at the Union Cabinet meeting on Wednesday when the National Democratic Alliance (NDA) government decides the country's targets for the Paris climate change agreement.
Government sources confirmed that the aggressive target for renewable energy capacity was worked out by the power and environment ministries under close supervision of the Prime Minister's Office and is now expected to be cleared by the Cabinet.
If the Cabinet approves this proposal, India would be looking at a commitment of building a total of 350 Gw of solar and wind power by 2030. Out of this, the government expects 250 Gw of the renewable portfolio to come from solar power and 100 Gw from wind power.
The NDA government has already committed to 100 Gw of solar power and 60 Gw of wind power by 2022. In the case of solar power, even the 100 Gw target for 2022 was a five-time jump over the target committed by the United Progressive Alliance (UPA) government under the Jawaharlal Nehru National Solar Mission.
The projections done by the government suggest that by 2030, India would have a total built up power capacity of 850 Gw. This ambitious target will help India offer the global community a 35 per cent reduction in the greenhouse gas emission intensity of its economy below 2005 levels by 2030 as part of its Intended Nationally Determined Contributions (INDCs) under the Paris agreement. At present, India has committed to 20-25 per cent reduction below 2005 levels by 2020. The government's preliminary assessments suggest India is on way to achieve the lower end of the existing target comfortably and could attain more with some extra effort in the remaining years.
While the usual definition of renewable sources includes hydropower and nuclear the government does not project substantial growth of capacity from these sources in future. "From the current levels of about 56 Gw, we should be able to ramp up capacity in nuclear and hydropower to about 80 Gw," one of the sources involved in the preparation of the INDC told Business Standard . The bulk of our growth shall come from solar, wind and coal, he added.
Hydropower could see an addition of 15 Gw over the existing roughly 50 Gw and nuclear power should be able to increase from about six Gw at present to about 16 Gw by 2030.
Growth in gas-based power is also not expected to grow though utilisation of the existing 25 Gw could be enhanced from around 10 per cent at present to 60 per cent officials said.
A second official, wishing not to be named, said, "While India will continue to demand developed countries come through on their obligations under the UN Framework Convention on Climate Change, the government also wants to do more than its fair bit. It is a very ambitious leap. It has taken a long period of discussions with many parts of the government involved besides all kinds of other stakeholders like the civil society and the industry."
Prime Minister Narendra Modi will be attending the UN General Assembly as well as special summit by UN Secretary General on climate change as part of his tour to the US which starts on September 23.
The decision on India's INDC is timed to make the announcement accordingly. The government is expected to formally submit the INDC document to the UN Framework Convention on Climate Change in the coming week as well.
Key countries and blocks have already declared their INDCs and the global community for a while has been watching India for its contributions. The US has declared that it would reduce its emissions by 24-26 per cent below 2005 levels by 2025, the EU has said it would reduce its emissions by at least 40 per cent below 1990 levels by 2030. China on the other hand has committed to peak its emissions around 2030 and reduce its greenhouse gas emission intensity between 60 and 65 per cent below 2005 levels by 2030 and ensure that the share of total non-fossil fuel rises to 20 per cent of its total total primary energy supply over the same period.
But observers have noted that the figures given by countries in percentage terms contain elements of uncertainty when converted to gross greenhouse gas emission reductions it entails. A published scientific paper in reputed journal has suggested that China might have already over-estimated its emissions from burning coal by around 15 per cent. If the Chinese government was to now relook at its method of calculating emissions, it could get greater legroom in future to peak.
http://www.business-standard.com/article/economy-policy/india-s-energy-mix-to-have-40-renewable-sources-by-2030-115092200057_1.html
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