Sustainability

Volkswagen can’t even get its kitchen sink right

29 Sep 2017

The German carmaker set aside another 2.5 billion euros for costs related to its emissions-cheating scandal – more than a tenth of the previous total. Two years on from Dieselgate, the final bill is still far from clear. Little wonder investors are so pessimistic.

U.S.-Mexico water deal will get investment flowing

27 Sep 2017

The two countries set aside broader trade disputes in a new pact to share the Colorado River. More cooperation gives clarity to the 40 mln people who rely on the waterway. It will also help secure the billions needed for conservation, reusing water and upgrading infrastructure.

German vote bodes ill for utilities and autos

26 Sep 2017

Chancellor Angela Merkel may well turn to the Greens to form a coalition government. The party’s priority is combating climate change. Carbon-heavy power producers like RWE and carmakers wedded to the internal combustion engine are likely to be the first in the firing line.

Climate-investing deal targets sustainable returns

18 Sep 2017

London-based Impax’s purchase of U.S. rival Pax stacks up financially and creates one of world’s largest climate-change specialist investors - with $13 bln in assets. Rising environmental risks should heat up demand for such funds, but also draw competition from bigger players.

U.S. electricity grid is a Category 5 problem

18 Sep 2017

Hurricane Irma left much of Florida without power after ripping down transmission lines. Burying cables is one fix, if time-consuming. But storms are just one catastrophe threatening the nation’s aging electricity infrastructure. Upgrading it could cost as much as $2 trillion.

Climate prediction market may help beat fake news

12 Sep 2017

A hedge fund might take bets on future global CO2 and temperature levels. Difficulties include thin liquidity and market manipulation, and some will object to scientists gambling based on their research. The potential value of a market-based climate measure means it’s worth a go.

Shell’s defence of big oil is too hopeful

11 Sep 2017

The Anglo-Dutch giant reckons demand will peak around 2030, but says crude oil will continue to play a major role in global energy supply thereafter. It’s a view that puts too much faith in the combustion engine’s survival – and China staying with its current course.

Viewsroom: Harvey’s path of financial destruction

7 Sep 2017

Texas is facing $180 bln in hurricane cleanup costs, the most of any U.S. natural disaster. The Lone Star State has the wherewithal and chutzpah to cover a large chunk, yet expects Washington to pick up most of the tab. Global water risks, meanwhile, may require $12 trln to fix.

Irma alone can’t wash away reinsurance excess

7 Sep 2017

Take a plentitude of capital and a paucity of disasters. Mix in a Florida building boom and massive hurricane, and the result looks like a giant hit to reinsurers. But the history of catastrophes suggests underwriting won’t become much more rational when the storm clears.

Hurricanes taunt Texas to put money where mouth is

6 Sep 2017

As Irma threatens Florida, the Lone Star State has $180 bln of Harvey damage to pay for. Most will come from the feds even though Texas hates big government. With low taxes, billionaires aplenty and a GDP that dwarfs the cost, minimizing D.C. aid ought to be virtually a state duty.

Record basketball price is timely bet on Houston

6 Sep 2017

The owner of the Landry's restaurant empire will pay $2.2 bln for the NBA's Rockets. Buying a trophy asset as the city rebuilds after Hurricane Harvey makes for awkward timing. And yet sports often unify a community and the big investment suggests abiding faith in a recovery.

Water investment glass isn’t even half full

1 Sep 2017

Hungary’s president has issued a rallying cry for the $12 trln needed by 2030 to meet water-linked climate goals. The problem isn’t a lack of money, but emerging states’ poor governance and lack of financial nous. Multinationals and pushy investors could help change that.

Harvey’s damage will long outlast the storm

31 Aug 2017

The sun is out over South Texas but the toll from the hurricane’s record rains keeps rising. With refinery closures extending eastward and a chemical plant exploding, the governor says losses could top Katrina’s. Gas shortages and surging prices will spread the economic fallout.

Harvey exposes flaws in U.S. energy-dominance plan

28 Aug 2017

Trump aims to boost American fuel exports by fostering coal and oil drilling. But the deluge in Texas has disrupted 16 percent of the nation’s refining capacity. Tackling climate change and hardening energy infrastructure should take priority over the president’s pet projects.

Daimler could be next on the break-up autobahn

26 Jul 2017

The German carmaker is thinking of turning its divisions into legally separate entities. Engineering group Siemens did that with its healthcare unit, which it plans to list. Carving out Daimler’s trucks could unwind a long-standing conglomerate discount of perhaps 30 bln euros.

German climate change policy takes Trumpian turn

18 Jul 2017

Angela Merkel has castigated the U.S. President for pulling out of the Paris accord. Yet two German states are putting mining jobs ahead of cutting carbon emissions. If they don’t reconsider, the Chancellor’s green credentials – and the global agreement – will suffer a blow.

Chinese green car boom fuels lithium rush

17 Jul 2017

Beijing's policy push toward electric vehicles is driving investor interest in lithium and lithium miners. The price of lithium carbonate has almost trebled since 2015, and acquisitions are underway. Demand for the suddenly strategic commodity could trigger a tussle over supply.

Volvo’s electric shift gives Tesla a shock

5 Jul 2017

The Sweden-based carmaker will phase out gasoline-powered vehicles starting in 2019. It has less than 1 percent of the global market but its plan challenges Elon Musk’s growth ambitions, especially in China, where Volvo owner Geely is based. The road to the future may be bumpy.

U.S. water doesn’t let Trump dampen the mood

30 Jun 2017

Industry bigwigs in New Orleans extolled an all-in approach to managing H2O, with one exception. They ignored White House plans to curtail clean-water rules to focus on fixing aging systems. Securing the needed $5 trln is urgent, but limiting federal control could be costly too.

U.S. waterworks wrestle with funding spigot

26 Jun 2017

The industry needs some $5 trln to patch up pipes, yet is getting little help from Washington. Water leaders convening in New Orleans this week have plenty of ways to woo investors. Fragmentation, cash-strapped customers and struggling utilities present significant risks, though.