Renewable Energy

AI will power up buyout barons’ green-energy spree

30 May 2024

Brookfield offered $6.6 bln for French solar and wind firm Neoen after EQT and KKR struck renewables deals worth $4.6 bln. Buyout barons have cash to meet the investment requirements of energy-hungry artificial intelligence, and future rate cuts mean valuations may have bottomed.

Inflation saps Inflation Reduction Act mini-me

16 May 2024

Australia is following the US with long-term support for greening the economy. But it's peanuts by comparison with just $15 bln for industry and nothing to boost sales of EVs and heat pumps. Fear of price rises and rate hikes ahead of an election has deflated ambition.

China tests EU resolve on export trade fight

14 May 2024

France’s Emmanuel Macron got little to show from President Xi Jinping’s European tour this month. In this Exchange podcast, MERICS expert Grzegorz Stec explains the difficulty of managing ties with Beijing and why balancing risk and business opportunity is so tricky.

Oil groups’ AGM rebels may lose even if they win

13 May 2024

Shell’s annual shareholder meeting will be a showdown between CEO Wael Sawan’s climate strategy and an activist group’s emission reduction proposal. Investors are unlikely to turn against the UK oil major. But the results may be disappointing even if they do force change.

Microsoft’s AI land grab becomes costly power game

1 May 2024

The tech giant is splurging on artificial intelligence models and chips. Now it’s made a big commitment to buy renewable energy for data centres, enabling Canadian investor Brookfield to build a massive 10 gigawatts of capacity. It’s another long-term bet on nascent technology.

Exxon and gas markets tell different stories

26 Apr 2024

CEO Darren Woods denies fossil fuels are in decline, thanks to growing populations and rising petrochemicals demand. Yet a glut of natural gas – which reined in quarterly profit at Exxon and rival Chevron – is a real problem, and one that could weigh on prices for a long time.

Anglo American has grounds to play hard to get

25 Apr 2024

The London-listed miner has received an all-share $39 bln bid from BHP. Anglo’s recent woes explain why, but its jumble of assets could be worth more. If boss Duncan Wanblad can show as much by outlining a plan B, he may yet see its $149 bln rival off – or extract a higher offer.

Shell’s value gap is more strategy than geography

19 Apr 2024

CEO Wael Sawan may shift the $230 bln UK oil giant’s listing to New York if a discount to rivals like Exxon Mobil persists beyond 2025. But Shell’s shifting priorities, slower growth, and unreliable dividends weigh on its valuation. Those factors defy a superficial fix.

Spain’s utility saga calls for tough balancing act

18 Apr 2024

The UAE wants to buy 40% of 22 bln euro Naturgy from its private equity owners. That would usually require a full takeover, but Madrid has form on protecting key infrastructure. Spain will have to balance its desire to retain control with the need not to scare its bidder away.

Prysmian finds sparky US fix for dim cable outlook

15 Apr 2024

The world’s biggest maker of telco and power lines is buying a cash-rich US rival. At $4 bln, the deal is not cheap, and heavy investment in grids has slowed. Still, adding heft to the more attractive North America market should improve the $15 bln Italian company’s prospects.

Next Chinese trade war could benefit the planet

8 Apr 2024

As Beijing floods the world with cheap green goods, the West will put up trade barriers. That will delay the energy transition in the United States and EU. But the glut of EVs, solar panels and the like will speed it up in China and much of the Global South.

AI’s power surge short-circuits longer-term plans

1 Apr 2024

Data centers account for 2.5% of the US grid, and machine learning is supercharging growth. Where and how to build megaplexes consuming as much electricity as a small nuclear plant are the immediate problems, but they’re solvable. Calculating future demand is the real conundrum.

Eni’s green shoots are taking time to blossom

28 Mar 2024

Italy’s $53 bln energy major trades at a discount to rivals. An overhang from Rome’s potential stake sale and falling gas prices are drags. But CEO Claudio Descalzi’s plan to raise cash by spinning off energy transition-focused business units is also yet to fully shape up.

Europe’s green giant is focusing on safer bets

21 Mar 2024

Iberdrola is upping investment on ageing power grids. The $79 bln Spanish utility is also buying out US unit Avangrid and allocating its biggest chunk of capex to the States. Both bets look likelier to pay off than renewable power and geographies with less generous subsidies.

Like Rome, oil demand won’t be destroyed in a day

18 Mar 2024

Oil producers attending the big industry confab in Houston this week recognize they are under pressure. US firms are merging; Saudi is reinventing itself. Like in any dwindling empire, many leaders will want to take over rivals. Rewarding investors with cash is a better strategy.

RWE has a way out of its valuation hole

14 Mar 2024

The $26 bln German power utility has lost 22% of its market value this year. Low gas prices, higher rates and a lingering presence in polluting lignite are reasons why. The first two ought not to persist as headaches, and the last is something RWE could do more about.

EIB backing would add spark to EU mini-nuclear bid

1 Mar 2024

Europe’s bid to develop smaller, cheaper nuclear reactors as part of its plan to cut carbon emissions needs cash and political support. European Investment Bank financing for next-generation projects would make a difference. Even so, green benefits may take years to materialise.

The green agenda’s best shot at a revival

13 Feb 2024

Economic distress prompted by globalisation undermines support for the energy transition, climate change economist Valentina Bosetti tells The Exchange podcast. That matters as key US and EU elections approach. Using proceeds from carbon taxes to address inequality is paramount.

BHP and Rio take competition out of going green

9 Feb 2024

The giant miners are teaming up to try and decarbonise steel production. Cutting the 8% of global emissions the current process belches out is key to saving the planet. The collaboration can help Australia keep up too. It makes this unusual setting aside of rivalry doubly smart.

Orsted revival requires more than belt-tightening

7 Feb 2024

The $23 bln Danish group cut its 2030 power capacity target and cancelled dividends after facing $4 bln of US impairments. For investors, it’s better than an equity raise. But an Orsted share-price recovery hinges on regaining their trust – and expected rate cuts materialising.