François Baroin, France’s finance minister: “It is not good news … but it is not a catastrophe. It is not the ratings agencies that dictate the policies of France.”
Solarcentury
The company I founded in 1998 to design and supply solar energy solutions for the built environment. Solarcentury
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Archive for the ‘Finance’ Category
Clean energy investment up 5% to $260bn in 2010, with solar more than half.
January 12, 2012 Clean Energy, FinanceSo Bloomberg New Energy Finance reports. The US retook top position from China, thanks to stimulus measures. Ethan Zindler, of Bloomberg NEF: “We are on the verge of a turning a corner where in the next five to seven years or so, subsidy will be much less important for clean energy investment.” Solar investment was up 36% to $137bn: more than a half of all clean energy investment. Kevin Parker of Deutsche Bank Asset Management: “We are on our way to the point where solar power costs the same as fossil fuel power, and it’s not that far away. When we get there, there’s going to be a lot of money to be made by the leaders in the solar industry.”
JL blog: Energy dramas for 2012.
January 2, 2012 Clean Energy, Climate, Coal, Finance, Gas, Nuclear, Oil2011 was a year of growing polarisation for those of us who long for renaissance fuelled by renewables. The Germans announced targets to run their railway system entirely on renewable energy, mostly wind,and solar. Yet BP announced it will quit solar entirely to pile ever further into tar sands, unconventional gas and the rest of the carbon status quo. The IEA pronounced that the cost of energy will rise “viciously” on a global basis without clean energy. Yet the British “Big Six” opted for so much gas that the installation rate of British renewables fell steeply: this despite conventional UK energy prices soaring so steeply that fully 1 in 4 of UK households fell into fuel poverty in 2011, up from 1 in 5 in 2010.
There were so many of these stark contrasts in the theatre of energy last year.
It seems that the closer renewables advocates get to their dream, the harder the defenders of the status quo push back the other way, notwithstanding the increasingly clear economic, environmental and social downsides. They surely are teeing up some dramas for 2012.
Not to mention interesting research material for neuroscientists interested in how dysfunctional human cultures work. Its not as though Big Energy, and their cosy nexus with conventional capital, just do these things and be done with it. They lobby for their short-term perceived interests – hard, and mostly below the radar – entraining many in officialdom and politics to their ruinous causes.
To the extent that solar energy in cloudy Britain might be a tiny-corner microcosm of a much bigger picture of the potential for renewable-powered renaissance, there is a particularly interesting drama unfolding as we enter 2012. In case you missed it, the British High Court ruled on 21st December that the UK government has acted illegally in proposing a retrospective reduction in the solar feed-in tariff. The arguments for and against were summarised that night on the BBC, here (headline and 7 mins 20 secs in for the detail). The government can appeal by January 4th, risking further humiliation in its efforts to cut back a solar market just a tiny fraction the size of Germany’s. Or it can switch tack, resurrect an industry that was creating thousands of jobs – at net economic benefit to the UK economy – in a time of dire need for such, while realigning with some its core strategic themes, not least a Big Society countering austerity-related unemployment with a domestic green industrial revolution. This will be a choice to watch as the dramas in the triple crunch of financial crisis, climate crisis, and energy crisis roll on in 2012.
Ecotricity eco-bond oversubscribed by 62%.
December 19, 2011 Change for Good, Clean Energy, FinanceSeeking £10 million of funding from customers and the public to help accelerate the building of new renewables projects, more than 2,000 people had between them applied for £16.2 million worth of ecobonds by the deadline, exceeding the success of ecobond one last year. The bond had a minimum investment of £500 and an initial term of four years. Ecotricity also offered a preferential rate to its customers – 6.5% as opposed to the 6% for non customers.
Hedge funds have returned to investors an average of ….zero.
December 11, 2011 FinanceFT: “The hedge fund industry delivers risk-adjusted returns of essentially zero, after fees, according to an innovative academic study” covering 2004-9.
Co-op aims to create an new social asset class to lend to developing country co-ops.
December 11, 2011 Change for Good, FinanceThe UK’s Co-operative Bank aims to create a new asset class providing growth capital for co-operative businesses in the developing world, starting with a new fund just launched, the Global Development Co-operative, which aims to raise $50m, which it will lend at low rates (2-5 per cent) to co-operatives looking to expand. Investors would gain a social return, and at best the return of their capital. Eight investors are backing it, and is seeking support from global investors and foundations interested in international development and investments with a social impact.
Why is a Keynesian solution so difficult to sell when it is clear that austerity is worsening the economic downturn?
December 6, 2011 FinanceJonathan Freedland in the Guardian: The seemingly counter-intuitive argument must be better framed. “A quick look at the record of British debt going back to 1830 shows that, by historical standards, our current indebtedness is no more than a modest uptick compared with, say, the late 1940s, when debt was five times as great as it is now – and yet it was precisely then, when the country really was drowning in red ink, that Keynes was advocating a fiscal stimulus.”
Standard & Poors flags downgrade of multiple EU countries.
December 6, 2011 FinanceAnn Pettifor in the Guardian: “So European politicians want to shoot the messengers. Sure, ratings agencies haven’t always been reliable, decent or honest. And sure, like eurozone politicians, Standard & Poor’s is just following events, not shaping them.”
Countercurrents: the triple crunch we face and the barriers to renaissance.
December 5, 2011 Clean Energy, Commentaries, Finance, OilIn an extended interview in India, I talk about the similarities between the credit crunch and the peak oil issue, and the power of renewables and why clean-energy industries are being held back.
UK economic outlook so bleak that business-as-usual capitalism cannot expect to muddle through now.
December 4, 2011 FinanceWill Hutton in the Observer: “The last time Britain endured such an extended period of depression and falling living standards – the 1870s and 1880s – saw the mushrooming of the co-operative movement and the emergence of the Labour party as the more moderate expressions of anger that wanted to challenge the very basis of capitalism. Be sure that British civil society will not accept its grim fate as if nothing is happening. There will be organised and angry responses – and rightly. We are about to experience economic, social and political tectonic plates on the move.”
Governor of Bank of England warns of spiral into crisis.
December 1, 2011 FinanceMervyn King: “The crisis in the euro area is one of solvency not liquidity. And the interconnectedness of major banks means the banking systems and economies around the world are all affected. Only the governments directly involved can find a way out of this crisis.” The Financial Policy Committee urges banks to continue building up their capital stock and urges them to limit bonuses and dividend payouts rather than cutting back on lending to businesses and households.
Enron-type speculation back in play in energy markets.
December 1, 2011 Finance, Gas, OilEnron was a high risk hedge fund disguised as a diversified energy company and some 500 companies had been approved by regulators to trade energy at the time it blew up 10 years ago. It took down Mirant, NRG, NEG and Calpine with it. Now, says Julian Dumoulin-Smith, director of equity research in the Electric Utilities & IPPs Group at UBS Securities, there is a growing queue of groups interested in trades beyond physical assets: Constellation Energy, Mercuria, Arcadia Petroleum, Glencore, RWE, EON, EDF. As one commentator says, its almost come full circle.
Top 20 banks lending to coal listed by NGOs.
November 30, 2011 Climate, Coal, FinanceThree American banks –JP Morgan Chase, Citigroup and Bank of America – top the list of coal financiers, having between them provided at least €42bn to the coal sector since 2005. Barclays took fifth place, having lent more than €11.5bn to big coal companies in the same period.
“29/11/11: a turning point in British history”.
November 30, 2011 FinanceSo writes Newsnight’s economics editor. “Yesterday’s Autumn Statement will set the political tone of the decade: it will tie the hands of future governments; and it has already brought a philosophical debate on the British right to an abrupt end. Within six hours of their tight-lipped ordeal on the government benches, Lib Dem MPs heard Danny Alexander pledge them to go into the 2015 election fully committed to £30bn more austerity than they signed up for in the Coalition Agreement. ….Plan A, in short, failed. It failed because the eurozone did begin to slow, and confidence was hit, and so exports – having surged – will not surge much more. But also because the very survival mechanism adopted by the Bank of England – near-zero interest rates, QE and talking down the pound, which has produced and maintained a 20% fall of sterling against world currencies – led to imported inflation. This has hammered the spending power of a workforce whose wages have been pinned to the floor, even in the weak recovery phase.”
Central Banks step in to try and head off next credit crunch.
November 30, 2011 FinanceStock markets surge after central bankers say they will cut the interest rate on emergency dollar loans to cash-strapped banks by 0.5 percentage points and extend the scheme until February 2013. In the dollar swap scheme to date, though, banks have been reluctant to borrow from central banks, for prestige reasons.
Chancellor is wrong to blame Europe for lost decade now inevitable.
November 29, 2011 FinanceSo argues Martin Wolf in the FT: “The big facts are that the UK is set for a lost decade and a longer period of stringency than expected. The government’s position is that there is no alternative. That has now become a self-fulfilling prophecy. So blame foreigners: that always works.”
“The eurozone has only days to avoid collapse”.
November 27, 2011 FinanceWolfgang Munchau in the FT: “Last week, the crisis reached a new qualitative stage. With the spectacular flop of the German bond auction and the alarming rise in short-term rates in Spain and Italy, the government bond market across the eurozone has ceased to function.The banking sector, too, is broken. Important parts of the eurozone economy are cut off from credit. The eurozone is now subject to a run by global investors, and a quiet bank run among its citizens.”
Martin Wolf: Don’t believe Bob Diamond.
November 10, 2011 FinanceThe Barclays boss made an “unconvincing” case for banking in his recent lecture, Wolf argues in the FT. Don’t look at the words, look at who is incentivised. Investors in banking have lost money, management has made a lot of money. And so on.
Rating agency mistakenly announces downgrade of French credit rating.
November 10, 2011 FinanceS&P apologises for the “technical error” on its website. As French bond yields leap, France is furious and demands an enquiry.
“UK Treasury prepares for ‘economic armageddon’ if the euro falls apart”.
November 10, 2011 FinanceSo reads the headline. The Bank of England prepares contingency plans, as Italian bond prices soar, Brussels revises grwoth forecasts down, and Berlusconi leaves office.
Richard Branson: “the absolute necessity” of investing in renewables.
January 5, 2012 Clean Energy, Climate, Commentaries, FinanceRichard Branson, in posting my latest blog on his website: “Struck by this email from my friend Dr Jeremy Leggett over Christmas highlighting the growing divide between those that believe in the absolute necessity of investing in renewable fuels and those who ignore the obvious need – preferring to focus on short term goals and profits. I believe we must keep investing in alternative fuels to help reduce our Global carbon problem. Those fearing that economic growth will be stifled by investment in renewables are wrong.” etc.
Tags: Renewables, Solar PV