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Dwindling copper supply from Panama and Peru could wipe out global surplus in 2024

The post Daily Energy Standup Episode #260 – Copper Supply Concerns, LNG Cruise Ships, and Geopolitical Shifts in the Oil Trade appeared first on Energy News Beat.

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No one expected the transition from fossil fuels to be easy. But a year after President Joe Biden’s landmark climate law promised billions of dollars for America’s switch to clean energy, some of the nation’s most ambitious renewable power projects have been shelved, electric car sales are missing targets and investors are fleeing the sector in droves.

The result is a $30 billion collapse in US clean energy stocks in the last six months—a market many investors expected to flourish in the aftermath of the law’s passage.

BidenPhotographer: Helen H. Richardson/MediaNews Group/The Denver Post/Getty Images

Few industries have been unscathed by soaring interest rates, but perhaps none has been harder hit than renewable energy. For a sector that builds big, expensive facilities such as solar plants and wind farms, high rates cut profit margins enough to sink projects and bankrupt companies. The giddy enthusiasm that followed the Inflation Reduction Act’s passage evaporated, wiping out a quarter of the market value of US companies in the S&P Global Clean Energy Index in the six months ended Nov. 27.

It’s a meltdown that underscores the obstacles standing in the way of Biden’s ambitious climate goals.

Along with sky-high financing costs, clean energy companies face the problems of winning over potential neighbors for their projects, securing government permits and plugging into a creaky power grid unable to handle all the renewable power that’s planned. Oil and gas producers, meanwhile, are doubling down on plans to keep pumping.

The warnings are clear: America’s road to achieving a zero-carbon electricity grid by 2035 is getting rockier by the day.

“We’re in the moment of realization now where some of the euphoria has worn off and we’re starting to realize it’s still not going to be easy,” says Eric Scheriff, senior managing director at Capstone, a Washington, DC-based consulting firm.

The specter of bankruptcies now haunts the sector. Electric bus maker Proterra Inc. filed for Chapter 11 protection earlier this year, with solar financing firm Sunlight Financial Holdings Inc. following soon after. Deals are falling apart: Private equity-backed Ares Acquisition Corp. abandoned its planned merger with nuclear power technology company X-Energy Reactor Co. in October.

And projects have been canceled: Utility owner Avangrid Inc. shelved wind projects in Connecticut and Massachusetts this year, while NuScale Power Corp. abruptly terminated its plans for the first small modular reactor in the US—a technology seen as key to the sector’s potential revival.

For anyone who remembers the last cleantech bust more than a decade ago, it’s easy to fear a repeat.

“In the final analysis, green investing has to be based on economic realities,” says Jerome Dodson, the now-retired founder of Parnassus Investments, one of the world’s largest sustainable investment firms, with $42 billion in assets. He sold his stake in the business in 2021—at the “top of the market,” as he puts it—and predicts that wind and solar stocks could fall an additional 15% to 20% in the next six to eight months.

It was only two years ago that Wall Street investors and bankers headed to Scotland for a global climate meeting, waxing lyrical about net-zero emissions goals and the profits to be made from the shift to cleaner energy. That’s a stark contrast to the current mood as the world convenes again for climate talks at the COP28 summit this week in Dubai.

American clean energy companies aren’t the only ones struggling. China’s biggest solar and wind turbine manufacturers recently reported shrinking profits. A fault in thousands of wind turbines forced Siemens Energy AG to seek a €15 billion ($16.2 billion) backstop led by the German government. And Danish wind developer Orsted A/S is fighting to recover from a $4 billion writedown stemming from two abandoned US wind projects.

In many ways, though, the problems are most surprising in the US.

Biden’s sweeping climate law offers at least $374 billion in tax credits and other incentives to spur the energy transition. Many saw it as a grand experiment to test whether subsidies, rather than top-down government mandates, would be enough to accelerate a change the planet desperately needs.

Electric bus maker Proterra filed for Chapter 11 protection earlier this year.Photographer: Joe Raedle/Getty Images

Instead, the US remains far off track for reaching Biden’s goal of a net-zero economy by 2050. Researchers at BloombergNEF estimate the IRA will get the country only halfway there, cutting annual greenhouse gas emissions from 5.3 gigatons to 2.3 gigatons by midcentury.

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‘We support a diplomatic solution’: Guyana defense spokesperson  356,513 soldiers, 120,000 officers to be deployed during voting

The Venezuelan government is fine-tuning the details, including the deployment of military personnel, to carry out a Dec. 3 referendum on its dispute with Guyana over the oil-rich Essequibo territory.

General Domingo Hernández Lárez, commander of strategic operations of Venezuela’s Bolivarian Armed Forces, said Nov. 29 that 356,513 soldiers will be deployed for security during the referendum, according to statements published in local media.

Also, the minister of the interior, justice and peace, Remigio Ceballos, said more than 120,000 police officers will be deployed, in statements broadcast by Venezolana de Televisión, the state channel.

The referendum, in which Venezuelan voters will be asked five questions concerning the dispute, will give the government a path to decisions in view of the intervention of the International Court of Justice in the resolution of the territorial dispute over more than 159 square kilometers (61 square miles) claimed by Venezuela for more than a century.

The court is expected to rule on the dispute Dec. 1.

Oil deposits

The conflict between Venezuela and Guyana has been rekindled since international companies such as ExxonMobil announced the exploitation of oil deposits in maritime areas that have not yet been delineated between the countries.

In recent weeks the conflict has escalated, after the president of Guyana, Mohamed Irfaan Ali, had his country’s flag raised in Sierra de Pacaraima, in the Essequibo territory, close to the de facto border. Venezuelan President Nicolas Maduro labeled that action a provocation.

Guyana also raised the possibility of establishing military bases with foreign support in the Essequibo territory and has said visits by US Department of Defense officials were planned, according to local media.

“The Department of Defense has a strong defense partnership with the Guyana Defense Force focused on areas of mutual interest, including countering transnational criminal organizations, maritime security, disaster preparedness, humanitarian assistance and human rights,” a Guyana defense spokesperson said Nov. 29.

“In Guyana, all defense cooperation and capacity-building activities with US military personnel are hosted by the GDF, at GDF facilities, sites or installations,” he said.

In regard to the border dispute, he added, “We support a diplomatic solution while the International Court of Justice process continues.”

Venezuela rejects court’s role

Maduro has repeatedly stated that Venezuela does not accept the interference of third parties, such as the International Court of Justice, in the territorial conflict. Maduro instead has adhered to the provisions of the 1966 Geneva Agreement that obliges the parties to seek a negotiated and satisfactory solution between both countries.

On Dec. 1, the ICJ will issue its order on the request by Guyana to prevent the referendum in Venezuela.

Guyana submitted a request to the ICJ to initiate proceedings against Venezuela in early 2018. In its request, Guyana asked the court “to confirm the legal validity and binding effect of the award relating to the boundaries between the colony of British Guiana and the United States of Venezuela, dated October 3, 1899.”

Venezuela disputes the validity of the 1899 award.

An escalation of belligerent actions, both by Venezuela and Guyana, could affect ongoing processes such as the relaxation of US sanctions on Venezuela, Venezuela’s electoral process scheduled for 2024 and even talks between Venezuela and Trinidad to produce and export natural gas.

The post Venezuela prepares for vote on border dispute with Guyana over oil-rich territory appeared first on Energy News Beat.

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In a public letter to President Biden, 3,882 car dealers spread across the country are asking that his administration slow down its proposed regulations mandating the production and distribution of electric vehicles.

The letter comes after the Biden Administration in April proposed a set of stringent climate regulations that could require two-thirds of all new U.S. passenger cars to be all-electric as soon as 2032.

The Environmental Protection Agency’s (EPA) proposal would not technically impose a limit on the number of internal combustion engine (ICE) vehicles a given company could sell; rather, the EPA through this proposal would limit the pollution created each automaker’s fleet.

In order to meet the proposed pollution requirements, carmakers would need to electrify the bulk of their fleets, and quickly, a feat they have lately been struggling with.

The dealers, in their letter, noted that there is currently a wide variety of good EV options on the market.

Despite this, “electric vehicle demand today is not keeping up with the large influx of BEVs arriving at our dealerships prompted by the current regulations. BEVs are stacking up on our lots.”

The enthusiasm of the early EV adopters, the letter says, has petered out. And not even the combination of price cuts, manufacturer incentives and government incentives are encouraging the masses to make the switch to electric.

“Today’s current technology is not adequate to support the needs of the majority of our consumers,” the letter reads.

Customers, according to the letter, remain concerned about price, and range, especially issues with range loss due to factors including temperature changes. Many customers, according to the coalition of dealers, have neither garages nor access to public charging stations, making a transition to electric difficult, at the very least.

These challenges, the letter argues, can and will be solved in time. But consumer sentiment won’t change in time for either dealers or manufacturers to be in line with the proposed regulations.

“This is the voice of the consumer,” Celebrity Motor Car owner Tom Maoli told CNBC, saying that unsold EVs are stacking up on dealers’ lots. “We’re now backed-up up to 12 months with EVs. Consumers don’t want them; they’re not buying them.”

Manufacturer rebates and government incentives, Maoli said, have done little to help EVs roll off the lots.

The consumer, he said, is in “fear over the infrastructure.”

“The White House got way out over its skis on this mandate, and the consumer has to buy into it and they’re not,” he said.

Automakers recently have been adjusting to the same consumer reality that Maoli pointed out — General Motors  (GM) – Get Free Report pushed back its EV targets and postponed a new EV lineup in an effort to preserve profitability; Ford  (F) – Get Free Report postponed around $12 billion in planned EV investments; Toyota  (TM) – Get Free Report remains convinced of the value of hybrids and even Tesla  (TSLA) – Get Free Report remains locked in a price war to entice wary consumers.

Still, the data shows that EV adoption is steadily increasing, even as consumer sentiment wanes.

EV sales made up a record 7.9% of total global car sales in the third quarter, while S&P Global Mobility recently reported a significant dip in the percentage of people open to purchasing an EV, compared to 2021 numbers.

“Buyers may want to wait for the next technological advance, or have concerns about charging time and charger availability, but in the end, consumer finances – not engineering – lead the current buying resistance to EVs,” S&P wrote in its report.

Source: Thestreet.com

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The National Grid is to pay some households to cut their energy use after activating its blackout prevention scheme during the current cold snap.

Eligible properties with smart meters will be offered cash and other rewards in return for reducing their usage between 5pm and 6.30pm on Wednesday, it has been announced.

It marks the first time the Live Demand Flexibility Service (DFS) has been activated this autumn and winter.

A spokesperson for the National Grid ESO (electricity system operator) said: “Our forecasts show electricity supply margins are expected to be tighter than normal on Wednesday evening.

“It does not mean electricity supplies are at risk and people should not be worried.

“These are precautionary measures to maintain the buffer of spare capacity we need.”

Sky News understands the scheme has been activated partly in response to the ongoing cold weather across much of the UK.

Forecasters have warned the UK could be hit by snow and ice in places over the coming days.

The scheme started in 2022 in the wake of Europe’s gas squeeze caused by the war in Ukraine.

More than 1.6 million households and businesses have been involved so far.

The amount paid to customers varies depending on their circumstances and regular energy use.

Eligible households do not have to turn off all electricity – including their lights – during a DFS period.

Instead they are urged to shut down appliances such as washing machines which can use high quantities of energy. Participation is also optional.

The scheme is estimated to have saved more than 3,300MWh of electricity across 22 activations in 2022, which is enough to power around 10 million homes for an hour.

Source: News.sky.com

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A coalition of nearly 4,000 auto dealers on Tuesday sent a letter to President Joe Biden explaining why his plans to force Americans into electric vehicles are unworkable.

The bottom line: Despite subsidies to car manufacturers to make the EVs, and tax credits for drivers to buy the cars, only 7% of new vehicle sales are electric vehicles, compared with Biden’s goal of 60% in 2030 and 66% in 2032.

The auto dealers wrote that “the supply of unsold [battery electric vehicles] is surging, as they are not selling nearly as fast as they are arriving at our dealerships—even with deep price cuts, manufacturer incentives, and generous government incentives.”

Their letter follows the announcement last month from GM and Ford that they are cutting back on projections of EV sales and lowering production targets for the cars and batteries because Americans prefer to buy other cars.

Ford Chief Financial Officer John Lawler, who postponed $12 billion in EV investments, said, “Given the dynamic EV environment, we are being judicious about our production and adjusting future capacity to better match market demand.” Similarly, GM described “evolving EV demand” as a reason for slowing production of electric pickup trucks.

Ford and GM describe EV demand as “dynamic” and “evolving,“ but in reality, it is static and devolving.

Auto dealers are getting stuck with the unwanted cars. Dealers have to pay in advance, and if the cars sit on the lots without being sold, their funds are tied up, and they don’t have room for better-selling vehicles.

Because Congress will not pass laws mandating purchases of EVs, Biden has proposed regulations from the Department of Transportation and the Environmental Protection Agency. These regulations would penalize automakers for selling gasoline-powered cars. California is going further, requiring all new-vehicle sales to be electric after 2035.

But, as the dealers say in their letter, “Some customers are in the market for electric vehicles, and we are thrilled to sell them. But the majority of customers are simply not ready to make the change.”

There are reasons that most Americans prefer to buy cars with internal combustion engines. The primary one cited is the difficulty of charging while on long trips or in homes that don’t have charging stations.

Most people who love their EVs recharge them at home overnight. But not everyone has a garage at home. Some live in apartments and homes without garages. Many of those people have to rely on charging stations for their EVs if they can’t run extension cords from their residences to the parking lot.

There are few charging stations in rural areas, where driving distances are longer.

Also, while gasoline-powered cars can be refueled in five or 10 minutes at a gas station, recharging an electric vehicle can take 45 minutes or longer for a full charge. Wait times are longer if someone else is at the charging station, and if some charging stations are out of order. Most people don’t want to let their EV battery go below 20%, and the charging rate goes down when it is charged over 80%.

In addition, batteries lose range in cold weather. A study by truck manufacturer Autocar shows that electric vehicles lose, on average, a third of their range in the winter, which reduces the typical 240-mile range to 160 miles. If a heat pump is added to the car, the loss is less, but still, the 240-mile range would shrink to 180. Only 380 North Dakota residents chose EVs in 2021, and Alaska had just 1,300.

New electric vehicles also cost more than gasoline-powered vehicles. The electric version of the base version of the Ford F-150 pickup truck, the best-selling vehicle in America, costs an additional $26,000. And Tesla’s base prices start at about $40,000 for a Model 3 and go up to almost $100,000 for a Model X.

Few Americans can afford these vehicles.

Dealers also cite lack of minerals available for EV batteries as a reason for pausing on the push for electrification. China has most of the minerals for batteries, and almost 80% of batteries are made in China. China is buying up many of the world’s mines where rare earth minerals used in batteries are found.

The forced push to EVs is making America weaker and China stronger.

Should Biden’s EV goal come to pass, America would become more dependent on China for electric batteries and associated components, rather than using abundant domestic oil and natural gas. That means sacrificing energy independence.

The Biden administration’s push for EVs is to supposedly reduce greenhouse gas emissions. But in order to produce supplies of batteries for EVs and other components, China is increasing its construction of coal-fired power plants. America has 225 coal-fired power plants (which the Biden administration is trying to put out of business), and China has 1,118 (half of all the coal-fired plants in the world).

Research by Kevin Dayaratna, chief statistician and senior research fellow at The Heritage Foundation, has shown that even completely eliminating all fossil fuels from the United States would result in less than 0.2 of a degree Celsius in temperature mitigation by the year 2100. (The Daily Signal is the news outlet of The Heritage Foundation.)

Biden says that EVs will reduce greenhouse gas emissions and that regulations on tailpipe and power plant emissions reduce global warming. But that’s a fantasy. Emissions will not be reduced until the biggest producers of so-called greenhouse gases—China, India, and Russia—reduce their emissions, which they show no signs of doing.

The dealers conclude their letter: “Mr. President, it is time to tap the brakes on the unrealistic government electric vehicle mandate. Allow time for the battery technology to advance. Allow time to make [battery electric vehicles] more affordable. Allow time to develop domestic sources for the minerals to make batteries.”

They are speaking not only for themselves, but for the vast majority of American drivers.

Source: Dailysignal.com

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Royal Caribbean International, a unit of Royal Caribbean, has taken delivery of its LNG-powered Icon of the Seas from Finland’s Meyer Turku.

After 900 days of design and construction by thousands of experts, Royal Caribbean International welcomed the highly anticipated Icon of the Seas to the family on November 27, it said in a statement.

Meyer Turku started building this vessel in June 2021, and laid the keel in April 2022.

The unit of Meyer Werft launched Royal Caribbean International’s 365 meters long Icon of the Seas in December last year.

In June, the vessel completed its first sea trials and recently wrapped up its second sea trials.

Royal Caribbean International and Meyer Turku claim this is the world’s largest cruise ship.

The cruise company said the vessel’s maiden voyage is scheduled to be in January 2024, when it will set sail from Miami for a week-long cruise in the Caribbean.

Icon of the Seas is also the cruise line’s first ship that can be powered by LNG.

This new Icon Class series of ships will comprise three luxury liners with a tonnage of about 250,800 GT and enough room for up to 5,610 passengers.

Meyer Turku plans to deliver the second vessel in 2025, followed by the third ship in 2026.

Besides these vessels, Royal Caribbean International has also an LNG-powered ship under construction at French shipbuilder Chantiers de l’Atlantique.

Source: Lngprime.com

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The global financial landscape is witnessing a seismic shift as the United Arab Emirates (UAE) boldly moves away from the US dollar in its oil trade dealings.

This strategic pivot aligns with the broader ambitions of the BRICS economic alliance, of which the UAE is a recent addition.

The changeover, involving the transition to local currencies for oil transactions, marks a significant departure from the long-established dollar dominance in the global oil market.

The BRICS Influence and UAE’s Strategic Shift

The BRICS bloc, comprising Brazil, Russia, India, China, and South Africa, recently expanded its membership to include the UAE, along with Saudi Arabia, Egypt, Ethiopia, Iran, and Argentina.

This expansion signifies a growing inclination towards de-dollarization among these nations, a move that challenges the traditional hegemony of the US dollar in international trade.

The UAE’s decision to prioritize local currency over the US dollar in new oil deals is a clear reflection of this sentiment. This move isn’t just a mere policy shift; it’s a strategic maneuver in the complex chess game of global economics.

By aligning with the BRICS nations, the UAE is not only diversifying its economic partnerships but also reinforcing its position as a global oil powerhouse.

This change could potentially reshuffle the cards in the international oil trade, impacting the dollar’s stronghold and introducing a new era of currency dynamics in oil transactions.

A New Era in Global Oil Trade

The UAE’s proactive search for new oil trading partners is a testament to its agility and foresight in navigating the evolving economic landscape. The significance of this move cannot be overstated.

It’s not just a matter of switching currencies; it’s about altering the very fabric of international oil trade. The potential ripple effects on the US dollar could be substantial, marking a shift in the global economic power balance.

Reports indicate that the UAE is eyeing potential oil and gas deals with up to 15 countries, including heavyweights like China, Russia, and Egypt, all of whom are members of the BRICS alliance and advocates of de-dollarization.

This isn’t just about diversifying trade; it’s about making a statement on the global stage. The UAE is not just following a trend – it’s setting one.

The move by the UAE to embrace local currencies in oil trades is not an isolated event. It’s part of a larger narrative where nations are increasingly questioning the status quo and exploring alternatives that better serve their economic interests.

This trend towards de-dollarization, particularly in crucial sectors like oil, could herald a new chapter in global economics, one where diversity in currency use in trade becomes the norm rather than the exception.

Bottomline is the UAE’s decision to transition from the US dollar to local currencies in its oil trades is a bold and strategic move that reflects the changing dynamics of the global economic landscape.

This shift, driven by the broader ambitions of the BRICS alliance, could have far-reaching implications for the dominance of the US dollar in international trade.

As the UAE forges new partnerships and navigates this evolving terrain, it positions itself not just as a key player in the oil market, but also as a trailblazer in the movement towards a more diversified and dynamic global economy.

Source: Msn.com

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Delfin Midstream, the US developer of a floating LNG export project in the Gulf of Mexico, has signed a long-term liquefied natural gas supply deal with a unit of Geneva-based energy and LNG trader, Gunvor.

Delfin LNG, a unit of Delfin Midstream, and Gunvor Singapore entered into the LNG sale and purchase agreement, according to a statement by Delfin Midstream.

Under the SPA, Delfin LNG will supply between 0.5 to 1.0 million tonnes of LNG per year to Gunvor on a free-on-board (FOB) basis at the planned Delfin Deepwater Port, located offthe coast of Louisiana for a minimum duration of 15 years.

Dudley Poston, CEO of Delfin, welcomed the signing of a “major” long-term LNG supply agreement with Gunvor.

This latest sale and purchase agreement “further demonstrates our attractiveness” as a long-term source of LNG, he said.

“We continue to support US LNG projects and unlock new sources to meet the growing global LNG demand while further expanding our supply portfolio,” Kalpesh Patel, co-head of LNG trading of Gunvor, said.

Delfin plans to install up to four self-propelled FLNG vessels that could produce up to 13.3 mtpa of LNG or 1.7 billion cubic feet per day of natural gas as part of its Delfin LNG project.

The firm also aims to install two FLNG units under the Avocet LNG project.

“The company has secured commercial agreements for LNG sales and liquefaction services and is in the final phase towards FID on its first three FLNG vessels,” Delfin said in the statement.

In October, Delfin won more time from the US FERC to put into service the project’s onshore facilities in Louisiana.

Delfin now has time until September 28, 2027, to construct and make available for service the onshore facilities.

Image: Delfin LNG

In July, Delfin said it expects to take a final investment decision on its first FLNG in October this year.

Delfin also negotiated a binding engineering, construction, and procurement contract with South Korea’s Samsung Heavy Industries and US engineer Black & Veatch and said that it expects to sign this deal by September this year.

The firm recently also joined forces with China’s Wison Offshore & Marine to develop additional floating LNG producers.

Besides the Wison deal, Delfin sealed a supply deal in July with UK-based Centrica worth about $8 billion.

Prior to that, the firm secured an investment from Japan’s shipping giant MOL and previously signed supply deals with Hartree Partners and Vitol.

In addition to these agreements, Delfin LNG entered into a heads of agreement in September last year with US oil and gas producer Devon Energy for long-term liquefaction capacity, but also a pre-financial investment decision strategic investment.

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