Renewable Energy

Siemens Energy’s vicious circle becomes virtuous

13 Nov 2024

The $35 bln German group surged 20% after it revealed punchy 2028 targets. For years, troubles in its wind unit obscured Siemens Energy’s status as a green transition winner. While these aren’t all fixed, the company looks cheap if CEO Christian Bruch can hit his new goals.

Many roadblocks delay journey to zero carbon world

28 Oct 2024

While solar power and battery supply have grown massively, the same is not true of electricity grids, green hydrogen and carbon removal. Money is more expensive. This means demand for oil, gas and coal has not yet peaked. The setback will cost the planet dearly.

One valve would release pressure at Air Products

17 Oct 2024

A $15 bln commitment to clean hydrogen is weighing on the industrial gas producer. The weakness has attracted attention from pushy investors over governance and capital usage. Selling some of the unproven green energy would help 80-year-old boss Seifi Ghasemi deflate the tension.

Equinor’s Orsted bet is cheap route to green goals

7 Oct 2024

The Norwegian driller has bought about 10% of the $26 bln Danish green energy group. Oil groups are more bullish about crude, but still have renewable energy capacity targets. Orsted’s recent strife offers a cheaper way for Equinor to get there than building the kit itself.

Big Tech farms out AI power build, keeps the risk

3 Oct 2024

Microsoft’s 10.5 GW electricity deal with Brookfield typifies a trend towards mega supply pacts. Given the huge capex bill for data centres, third-party power makes sense. But if artificial intelligence flops, so-called hyperscalers may be left with a lot of electrons to flog.

Clouds gather over China’s needed solar mergers

4 Sep 2024

Earnings from $12 bln cell giant Tongwei underscore the industry's harmful overcapacity. Its deal to acquire a smaller rival may not provide relief, however. The target's local government investors may complicate any right-sizing. Offshore assets look like the real draw.

China’s ammo export curb is more a green defence

19 Aug 2024

Beijing is restricting overseas sales of antimony, a metalloid it dominates production of that's also a key ingredient for weapons. Realpolitik alone would explain it. But the People’s Republic also needs the supply-constrained element for its rapid production of solar panels.

Past storms are still blowing against Orsted

15 Aug 2024

The Danish renewable energy firm has gained nearly 60% in market value since surprise US impairments shook confidence last year. Upcoming rate cuts can help but wind farm delays and supply chain risks remain. CEO Mads Nipper will find it hard to get the stock out of the doldrums.

Power grids’ low-wattage resources may spark M&A

13 Aug 2024

European electric utilities have to invest big to meet rising demand. Yet balance sheets are laden with debt and raising equity is tough. Some will have to sell assets, or whole companies. Iberdrola’s $5 bln acquisition of a UK peer at a decent premium could be the first of many.

Airlines’ margins head to lower cruising altitude

2 Aug 2024

Carriers from $2 bln Air France-KLM to $7 bln Lufthansa reported healthy demand in the first half of 2024. But earnings are falling as expenses bite. With the switch to sustainable aviation fuel threatening to push costs ever higher, investors are bracing for smaller margins.

Green hydrogen fever gets needed doses of reality

1 Aug 2024

Over the past five years, supporters argued the low-carbon gas would be a big fossil fuel killer. Cost and science makes much of that fanciful. Fortescue nixing production goals and EU targets being dubbed too ambitious suggest the industry is getting more practical and smaller.

UK growth fix can start with pampered rich savers

19 Jul 2024

New Prime Minister Keir Starmer wants to unblock Britain’s dismal economy. One aid would be to raise revenue by cutting superfluous tax perks for wealthy savers. Another is to find a way to deploy UK savings in more growth-enhancing assets than is currently the case.

Solar giant illuminates China’s overcapacity bind

16 Jul 2024

The $15 bln Longi Green blamed a supply-demand mismatch for its profit warning. It's a repeat of an investment boom that caused an industry bust and a tariff war with the US and EU a decade ago. Beijing's desire to support new tech is leading it in the same direction again.

UK green fund has risky but valid investor carrots

10 Jul 2024

The new government’s ‘National Wealth Fund’ is really $9 bln of public cash with capped returns. The risk is private investors slated to provide treble that figure get too good a deal. But with the UK’s energy transition requiring $64 bln a year, a degree of largesse makes sense.

Copper’s green step change is an uphill struggle

9 Jul 2024

Supplies of the red metal have to motor if the world is to adequately decarbonise. In this Exchange podcast Tae-Yoon Kim, senior energy analyst at the International Energy Agency, lays out the challenges that need to be overcome if the private sector is going to make that happen.

Data centre boom reveals AI hype’s physical limits

4 Jul 2024

The investor frenzy over artificial intelligence assumes there will be enough infrastructure to support apps like ChatGPT. But a $1 trln rush to build data centres faces planning restrictions and energy constraints. That will limit processing power and push up costs for users.

A South Korean EV reversal would inspire copycats

27 Jun 2024

Splitting out electric-car related assets was a popular ploy for firms like Renault and Geely to charge up valuations. But now conglomerate SK might go the other way by merging its loss-making battery business with another unit. As EV demand slows, similar reversals may follow.

Mining M&A stokes coal race against cleaner power

20 Jun 2024

Anglo American will soon offload dirty deposits used to make steel as part of CEO Duncan Wanblad’s overhaul. Rival sales suggest there should be plenty of suitors. Coking deals can pay off for buyers if prices stay high and green options develop slowly, but neither is assured.

Net zero arbitrage is large, but no one-way bet

14 Jun 2024

There’s a big gap between the rich world’s ambitions to reduce carbon emissions and the ability of governments to achieve that goal. Investors can try to exploit that disconnect. However, economic, technological and geopolitical constraints can quickly change in unexpected ways.

Biden’s hydrogen goals are like oil and water

4 Jun 2024

The White House wants to foster production of the abundant element as an alternative to fossil fuels, but oil and gas companies want a chance to pitch in. Environmentalists see that as a trap. Even so, there may be no choice but to extend oil majors like Exxon an olive branch.