Climate concerns haven’t crippled big oil funding

Energy News Beat

Oil Price

The global push for decarbonization hasn’t impacted either the access to external capital or the cost of capital for oil and gas companies, S&P Global Ratings and S&P Global Commodity Insights said in a new report.

Source: Oil Price

Most mid-sized and large oil and gas companies in Europe and North America “still have a relatively long runway in terms of capital access,” the authors of the report wrote.

Those firms could see intensified pressures in terms of access and cost of capital after 2030 when oil demand is expected to begin to flatline and eventually start to drop, according to S&P Global.

Moreover, despite the volatility in the industry, “there have been little discernable risk premiums attributed to oil and gas bond pricing (outside of commodity cycle troughs) compared with those of the broad corporate industrial universe,” S&P Global noted.

Overall, capital markets continue to be open to funding fossil fuel companies. But those firms have seen lower needs to borrow money in recent years amid record earnings and cash flows. Big Oil and independent mid and large-scale North American producers emerged from the pandemic-driven industry slump with stronger balance sheets and raked in record-high profits last year when energy commodity prices shot up in the wake of the Russian invasion of Ukraine.

“Environmental concerns seem to be far from the most important factor for funding of oil and gas companies,” S&P Global said.

In some cases, some firms have seen difficulties in borrowing, but this has likely been related to the quality of the assets instead of climate concerns, S&P Global added.

While this analysis shows that Big Oil doesn’t have to worry about access to capital in the near to medium term, some investors have started to pay more attention to the ESG credentials of the companies in their portfolios.

Climate change is the single largest motivation of investment institutions to decide to exclude companies from their portfolios, a newly launched ‘exclusion tracker’ showed last month.

By Tsvetana Paraskova for Oilprice.com

 

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Goldman Sachs sees OPEC keeping oil in $80-$100 price range

Energy News Beat

Oil Price

Goldman Sachs expects OPEC to not let oil prices slide too much below $80 per barrel next year and use its pricing power to keep them in the $80-$100 range, the bank said in a note this week, ahead of the OPEC+ meeting on November 26.

Source: Oil Price

Oil prices dived this week to their lowest level since July as market participants focused on concerns about the world’s two biggest economies—the United States and China. The U.S. benchmark WTI Crude slumped below $75 a barrel, and Brent Crude prices slipped below the key threshold of $80 per barrel. On Thursday alone, oil plunged by 5% and was on track early on Friday to post a fourth consecutive week of weekly losses.

Oil prices fell into a bear market this week, after falling by more than 20% from a recent high in September.

“Crude oil prices collapsed on Thursday, falling close to 5% with Brent dipping below $77 and while rising US inventories and demand worries were the triggers, technical selling was the driver,” Saxo Bank’s strategy team said in a Friday note.

“The $75 oil has previously sparked a response from OPEC, and the cartel meets on November 26, when they will consider how to respond to weakening oil prices and concerns that a potential stumble in global growth could hold back demand. For now, the bears are in the driving seat once again.”

However, Goldman Sachs believes that OPEC will use its production policy to keep prices in the $80-$100 range.

“We believe that OPEC [Organization of the Petroleum Exporting Countries] will ensure Brent in a $80-$100 range by leveraging its pricing power, with a $80 floor from the OPEC put, and a $100 ceiling from spare capacity,” Goldman Sachs’ commodities analysts led by Daan Struyven wrote in a note to clients, as carried by MarketWatch.

By Charles Kennedy for Oilprice.com

 

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Chevron expands Venezuela oil swap deal as sanctions ease

Energy News Beat

Oil Price

Following the U.S. sanctions relief on Venezuela’s oil industry, supermajor Chevron has started to supply Venezuelan state oil firm PDVSA with fuels in an expansion of an oil swap deal, Reuters reports, citing sources with knowledge of the matter.

Source: Reuters

Chevron has already sent one cargo to Venezuela as part of what could be an expanded oil swap agreement under which Chevron receives Venezuelan crude oil in exchange for fuels and diluents for the Chevron-PDVSA joint ventures operating in the South American country.

One vessel carrying naphtha has already docked at the port of Jose, while another cargo of gasoline blend stock was chartered this week and is expected to arrive in Venezuela later this month, according to Reuters’ sources.

Before the U.S. eased the sanctions on Venezuela, Chevron was the only Western major with a special exemption from late 2022 to operate in Venezuela and export crude from the country holding the world’s largest crude oil reserves.

The easing of the sanctions now allows the production, lifting, sale, and exportation of oil or gas from Venezuela, and the provision of related goods and services, as well as payment of invoices for goods or services related to oil or gas sector operations in Venezuela.

As a result, the top international oil trading houses are back in the business of trading with oil from Venezuela.

Some of the largest independent oil trading houses are already offering Venezuelan cargoes, including to U.S. buyers. Commodity giants have also struck deals to buy crude from intermediaries approved by Venezuela’s state-owned oil company PDVSA.

Vitol Group, the world’s largest independent oil trader, has hired a supertanker to load oil from Venezuela, lists of ship charters compiled by Bloomberg showed earlier this week.

Gunvor Group was the first of the biggest trading houses to offer to U.S. refiners a supertanker of Venezuelan crude, according to sources familiar with the matter who spoke to Bloomberg.

Gunvor and another commodity trading giant, Trafigura, have accessed Venezuelan cargoes in recent weeks after buying crude from intermediaries approved by PDVSA, Reuters reported last week, citing company documents and four people with knowledge of the deals.

By Tsvetana Paraskova for Oilprice.com

 

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As Detroit solar plan advances, community activists are wary

Energy News Beat

This article originally appeared on Planet Detroit.

After Mayor Mike Duggan announced nine finalists in his campaign to recruit Detroit neighborhoods to host solar panel arrays at a Wednesday press conference, community members and activists are divided over whether the plan will help or unfairly burden their communities.

“I thought it was time the city of Detroit stepped up and took action on climate change,” Duggan said. “Too much of the climate change discussion in this country, as far as I’m concerned, is empty performance.”

Under the program, owner-occupied households in selected communities would be eligible to receive $10,000 to $25,000 in energy-efficient upgrades, such as new windows, roofs, energy-efficient appliances, or battery back-up for power outages. 

Detroit would own the land for the solar arrays and contract with private solar developers to build and operate them. Details for how the city would be credited for the power are not yet determined, Duggan said.

Of the nine, he said six will be selected to assemble 250 acres of vacant and underutilized land to offset the electricity used to power city operations. Duggan said the project will cost the city about $8 million a year, or roughly what Detroit now pays DTE Energy to power the city’s 127 public buildings, plus $1-2 million per year more to provide community benefits. He said he plans to bring a funding proposal to city council by spring.

The finalist neighborhoods includeGratiot/Findlay, Greenfield Park/I-75 McNichols, Grixdale, Houston Whittier/Hayes, I-96/Plymouth (O’Shea), Mount Olivet, State Fair, Trinity Pickford and Van Dyke/Lynch.

Duggan emphasized that the city would place solar arrays only in areas “where we are wanted,” noting that the city would buy out residents in owner-occupied homes with a minimum offer of $90,000 and would pay moving costs and 18 months’ rent for tenants. He previously said the city sought “stretches where they don’t have more than one or two occupied homes.” 

But several proposals contain a number of residences, especially rentals. 

For example, the footprint of the 21-acre Mt Olivet project contains 16 renter-occupied and seven owner-occupied homes.  Duggan said the fenced-in solar panel arrays would contribute to neighborhood stability and prevent illegal dumping in vacant and abandoned areas of the city. 

But Duggan spokesperson John Roach said the city could also use eminent domain to assemble land for the arrays, and the mayor said the city may condemn vacant properties owned by speculators. The finalist neighborhoods have until Jan. 31 to provide documentation that residents in owner-occupied homes are willing to move. 

Measha Parker has lived in Gratiot-Findlay for 18 years. She’s president of her block and said she hoped the fenced-in panels on 24 acres would help fight illegal dumping and drive out illegal drugs in the area. 

She’d also like to see the former Wilkins Elementary School building, which has sat vacant for years, demolished as part of the plan. But she is concerned about vandalism and hopes the solar arrays will have surveillance cameras. 

“It’ll bring safety over there,” she said. “Once they put the solar panels up…. It’ll help with the blight and help the whole area survive.”

Block club captains in the Gratiot-Findlay area. Left to right: Donna Anthony, Measha Parker.

But several residents and sustainability advocates Planet Detroit talked to question the emphasis on large solar arrays that won’t provide energy directly to residents. Others voiced concern that the projects could attract even more blight.

Birch Kemp, a lifelong Detroiter and president of the nonprofit tree-planting organization Arboretum Detroit, said he supports installing solar panels on top of buildings but worries that fenced-in solar fields will only add to blight problems and hurt property values. 

Kemp said city officials approached him and others living in and around the Poletown East area about a possible array around Perrien Park, a former Detroit Public Schools site, but neighborhood organizations unanimously rejected it.

“It’s not going to increase anybody’s property value. It’s not going to make it look more beautiful. And it’s not going to increase your access to green space,” he said. “It’s going to be like a little prison for solar panels.”

A recent study found solar installations in California, Connecticut, New Jersey, Minnesota, and Massachusetts reduced property values by 1.5% within half a mile, and outcomes varied by state.

Kemp added that the solar fields would tie up land the city could use for open space and green infrastructure to sequester stormwater and prevent basement flooding. He also worries that trees would need to be cut down to reduce shade on the panels.

Experts consider tree cover important for reducing heat and managing stormwater. And while solar power is considered critical for dealing with the climate crisis, solar fields can create a localized increase in temperature

This may pose a special problem in Detroit, where the heat island effect, or the capacity of impervious surfaces to absorb and re-emit heat, already increases temperatures by 8 degrees or more.

Jon Kent, a Riverbend resident and co-founder of Sanctuary Farms, also supports solar, but said communities hosting the arrays should benefit more than what he sees in the current proposal.

“They’re doing this within neighborhoods that are really poor and really disengaged,” he said, adding that these areas would be getting a one-time pay-out while the city would continue to benefit.

Kent said he’d like to see the city take more time with the process, doing additional community outreach and building in a more extensive community benefits process that could include allowing communities to renegotiate the terms for hosting arrays in the future.

The expedited time frame may be driven by pressure to secure federal support through the Inflation Reduction Act before this program ends in 2033. A city of Detroit spokesperson confirmed that the city is seeking federal credits to offset municipal operations’ energy use under the IRA. However, they added that the short timeline is because “the mayor feels the climate crisis is an urgent matter.”

Roach defended the current plan, saying the city worked with 15 renewable energy groups to develop the proposal and that eight groups, including Walker-Miller Energy Services, EcoWorks and the GreenDoor Initiative, have been working with neighborhoods to help them develop community benefit requests.

“This is a remarkable partnership between renewable energy advocates and neighborhood groups to design better neighborhoods that will help fight climate change,” he said. 

Roach also pushed back on the idea that solar could hurt property values. “Those who best know the property values in a neighborhood are those who actually live there, which is why they will be the ones choosing the sites,” he said.

Jackson Koeppel, a Highland Park-based energy democracy practitioner and former executive director of the nonprofit Soulardarity, questioned the strategy of jumping immediately to large-scale solar arrays before embracing more targeted strategies.

“This approach to just build out as much solar on vacant land as possible to meet that need isn’t the right order of operations,” he said. Koeppel argues that on-site and rooftop solar and battery storage is the most cost-effective approach for city operations because it would generate “behind the meter” power that would allow the city to avoid the full cost of energy it would otherwise have to purchase. 

Instead, the mayor’s proposal would have a third-party solar developer generate the power and likely sell it to DTE, which could then credit the city on its bills. The city’s request for information from solar developers did include inquiries about behind-the-meter projects at municipal facilities.

North Rosedale resident Amanda Paige said the city could incorporate solar energy into the urban landscape in other ways, like installing rooftop solar panels in neighborhoods or putting panels on top of structures like parking garages and bus shelters.

She worries especially about those living in some of Detroit’s most disinvested neighborhoods who may be underwater on their mortgages and struggling to build generational wealth.

“They’re not attractive,” Paige said of solar panels. “It’s not going to do anything for your long-term property values if you’re across the street from a big solar farm.”

 

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Gas infrastructure needs to be ready for clean hydrogen

Energy News Beat

Oil Price

As green hydrogen becomes an ever more important clean energy source, governments and energy companies must prepare for a steep incline in production in the coming years and ensure they have the correct infrastructure to transport it. Some regions of the world are already establishing major hydrogen corridors, such as the Spain – Netherlands link in Europe.

Source: Oil Price

Adapting new natural gas developments to be suitable for hydrogen transportation could save companies money and time in the long term, as well as support the transition away from fossil fuels to renewable alternatives.

This month, the CEO of Italgas, Paolo Gallo, emphasised the importance of constructing gas infrastructure that is capable of transporting hydrogen as a means of meeting decarbonisation goals. Gallo stated, “Today we are moving around natural gas, but tomorrow we will have biomethane [and] clean hydrogen that will be used to decarbonize the system… So, it’s extremely important that the infrastructures are ready to accept different kinds of gases in [a] blending situation.”

Green hydrogen, produced using renewable energy sources rather than fossil fuels to power electrolysis, is being viewed as increasingly important for accelerating the global green transition. Unlike wind or solar power, green hydrogen is a versatile carrier that can be used in a range of ways, such as in fuel for transportation. While most hydrogen is produced using fossil fuels at present, favourable government policies and increased pressure on energy companies to decarbonise are expected to lead to a boom in green hydrogen production over the coming decades.

Gallo is not the first to suggest the repurposing of existing infrastructure, with several energy companies around the globe exploring ways to adapt existing pipelines to make them suitable for transporting hydrogen.

Many European countries are aiming to use existing gas infrastructure to transport hydrogen, with several recent studies and pilot testing phases showing positive results. The use of existing pipelines can reduce hydrogen transport costs but pipelines must be assessed to see whether they’re suitable for hydrogen transportation, taking into account issues such as leakage, leakage detection, effects of hydrogen on pipeline assets and end users, corrosion, maintenance, and metering of gas flow.

The potential use of gas pipelines for transporting hydrogen is becoming an increasingly popular topic as many governments accelerate plans to increase their natural gas production and infrastructure. This is being seen in the U.S., which, controversially, has an LNG project pipeline of 13 facilities along the US Gulf Coast in Louisiana and Texas. Canada is also constructing its first LNG transport facility, after years of pressure from energy companies.

This reflects the global sentiment that natural gas will be critical for achieving the green transition. The EU ruled last year that natural gas will be used as a transition fuel in the mid-term shift to green alternatives as a means of moving away from more polluting fossil fuels, such as oil and coal.

This has driven many energy companies to announce new gas projects for the next decade. This regional production drive was further accelerated by gas shortages in Europe and North America following the Russian invasion of Ukraine and subsequent sanctions on Russian energy last year.

As companies develop new natural gas projects with support from state governments – potentially at odds with national climate policies – they should consider the potential for new pipelines to be used for transporting alternative energies, such as green hydrogen and ammonia, to ensure new infrastructure does not go to waste as the demand for gas eventually wanes.

In the U.S., the Department of Energy’s Hydrogen and Fuel Cell Technologies Office (HFTO) launched the HyBlend initiative in 2021 to address technical barriers to blending hydrogen in natural gas pipelines to support the DoE’s H2@Scale vision for clean hydrogen use across multiple sectors in the economy. The U.S. has around three million miles of natural gas pipelines and more than 1,600 miles of dedicated hydrogen pipelines. The HyBlend team will test gas pipelines across the country to see their suitability for transporting hydrogen in different blends.

This year, Open Grid Europe (OGE) announced that the first long-distance gas pipeline in Germany is being converted for hydrogen use. The 46km pipeline in the northwest of the country will be ready to transport hydrogen from 2025. The project is part of the GET H2 Nukleus project and is being funded by the EU’s Important Project of Common European Interest (IPCEI) initiative. The adaption of the pipeline is expected to help companies in heavy industry and medium-sized businesses connect to the hydrogen supply.

Several new natural gas facilities are being constructed to support mid-term energy security en route to a green transition. At the same time, many companies around the globe have announced plans to develop their green hydrogen production over the coming decade, with demand expected to rise significantly over the next few years. Energy companies and governments must now use this opportunity to develop pipelines that can be used for the transport of both natural gas and green hydrogen to save money and time in the future and better support a green transition.

By Felicity Bradstock for Oilprice.com

 

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Go green, go broke: ‘Clean energy’ fails a basic economics test

Energy News Beat

Clean-energy stocks plummet as renewable energy projects prove to be too expensive, threatening America’s environmental aspirations

The once-glorified clean-energy stocks are now facing their darkest days, plunging the industry into a financial abyss that threatens America’s ambitious environmental aspirations. The much-touted green revolution is looking more like a red alert as the sector hemorrhages tens of billions in market value.

Sure, we’re told that hundreds of billions is still pouring into renewable energy projects, despite the fact that the stock market seems to have declared a resounding “no thanks” to these ventures. The iShares Global Clean Energy ETF (Exchange-Traded Fund), the poster child for the industry, has nosedived by over 30% this year and a whopping 50% since the dawn of 2021.

Not to be outdone, specific sectors are getting their fair share of punishment. The Invesco Solar ETF is down over 40% in 2023, while the First Trust Global Wind Energy ETF is witnessing losses of about 20% this year and a grim 40% since January 2021. It seems the wind has been knocked out of their sails.

Blame it on rising interest rates, the industry’s newfound nemesis. These higher rates have not only increased costs but also put a damper on consumer enthusiasm, leading to a nosedive in stock valuations for companies that once promised a green utopia but are now struggling to turn a profit.

Solar companies such as SolarEdge and Enphase Energy are feeling the burn as demand for their products dwindles. Meanwhile, wind energy giant Orsted is singing the blues, with shares plummeting after revealing potential multibillion-dollar write-downs on its offshore wind projects in the US.

In Germany, after the Nord Stream sabotage, because, you know, energy geopolitics and straightforward plans always go hand in hand, a whopping 77% of skeptics are shaking their heads, expressing disbelief that the nation will magically conjure up 80% of electricity from renewables by 2030. I guess turning skepticism into solar power hasn’t quite hit the mainstream yet.

Switzerland, the poster child for phasing out nuclear power, is now flexing its green muscles by entertaining the idea of keeping nuclear plants running longer, because who needs a clear exit strategy when you can just extend the atomic party until 2040?

Biden’s green dreams are melting faster than his favorite ice cream in the sun

In the US, the demise of two New Jersey wind projects is just the tip of the iceberg, with inflation, sky-high interest rates, and a supply chain in shambles throwing a wrench into the gears of Joe’s climate ambitions. Despite a whopping $369 billion in federal aid from his climate law, clean energy projects are dropping like flies. Even the postponement of a Kentucky EV battery plant by Ford and General Motors trimming their EV plans couldn’t escape the economic tempest. It seems the only thing rising faster than hopes for a clean energy revolution is the cost. But hey, who needs affordable, reliable energy when we’ve got grand climate goals, right? Biden’s green plans are becoming a chilling reality check, and it’s not just the polar ice caps feeling the heat.

It’s ironic, isn’t it? Not too long ago, clean energy was hailed as the savior of our planet, but now it seems the green agenda is drowning in a sea of red ink. The S&P Global Energy index, once a shining star, has seen its value halved since 2020 – a spectacular fall from grace.

Fast forward to the present, and we witness the mighty green stocks taking a severe beating. Despite the EU and US governments offering billions in tax credits and subsidies to support the so-called green transition from Russian oil and gas, investors are losing confidence faster than you can say “renewable.”

The S&P Global Clean Energy Index has experienced a gut-wrenching 30% freefall in 2023, with the biggest quarterly outflow of $1.4 billion. The once-booming sector now holds a 23% decline in total assets under management, a far cry from its heyday just a few months ago.

Blame it on the current economic climate, they say – high interest rates, soaring costs, and supply chain woes are the villains of this melodrama. And let’s not forget China, the puppet master of the solar supply chain, flooding the market with cheap alternatives, undermining the EU’s dreams of a local green market.

As utility stocks struggle to convert to green energy, the sector’s operating margins are squeezed.

The final nail in the coffin? NextEra Energy Partners cutting its growth target by half, sending shockwaves through the renewable industry. I dismiss the sell-off as overblown, but the damage is done, and confidence in renewables has hit rock bottom.

So, what’s the moral of this green tale? It turns out, going green is not just about saving the planet; it’s an expensive affair. As the renewable energy stocks hit rock bottom, analysts are left wondering: is it time to buy, or is the green dream truly over?

In a deliciously ironic plot twist, Greta Thunberg is currently sizzling in the crucible of criticism for daring to support Gaza. It seems our climate crusader is now facing a cancel-culture bonanza, much like the tweet she swiftly deleted – you know, the one prophesying Armageddon and cautioning that climate change might just “wipe out humanity” unless we magically halt fossil fuel usage by the grandiose deadline of 2023. The irony is thicker than Beijing’s smog, folks.

Seems like even the green warriors can’t escape the unforgiving reality of the market.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.

 

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Speaker Johnson Releases Jan. 6 Videos To The Public

Energy News Beat

By Joseph M. Hanneman of Epoch Times

More than 40,000 hours of Jan. 6 Capitol Police security video will be made public on a dedicated website starting immediately and ramping up in the coming months, House Speaker Mike Johnson (R-Louisiana) announced on Nov. 17.

However, individual video clips released to media or other requesters will have the faces of identifiable individuals blurred, a senior congressional aide told The Epoch Times. That restriction drew immediate fire from some Jan. 6 criminal case defendants.

“So while we are significantly expanding the amount of clips that will be available and who can request them, we will be blurring faces with respect to individuals who are identifiable,” the source said.

“To restore America’s trust and faith in their government we must have transparency,” Johnson wrote on X.com. “This is another step towards keeping the promises I made when I was elected to be your Speaker.”

The Committee on House Administration’s Subcommittee on Oversight, chaired by Rep. Barry Loudermilk (R-Ga.), has already posted 90 hours of Capitol security video in the online viewing room. The initial release includes footage previously provided to various media outlets.

“The goal of our investigation has been to provide the American people with transparency on what happened at the Capitol on January 6, 2021, and this includes all official video from that day,” Mr. Loudermilk said in a statement. “We will continue loading video footage as we conduct our investigation and continue to review footage.”

More videos will be added to the public site on “a rolling basis,” the source said.

“By current estimates, there are roughly 40,000 hours that we will be making public over the next few months as quickly as we can,” the congressional aide said.

Some video will be withheld if it is deemed “security sensitive” or if it could “potentially provide a roadmap for doxxing and harassing private individuals,” the aide said.

Beginning on Nov. 20, members of the public will also be able to view footage on terminals in the committee’s offices on Capitol Hill, the source said.

Those wishing to view the video at committee offices will have to request a time slot by emailing [email protected].

In-person viewing on the congressional video terminals offers advantages over the online viewing room. In-person viewers can select individual cameras from an interactive Capitol map and narrow the footage by timeframe.

The in-person system has maps for each level of the Capitol. The Capitol grounds are separated into zones, with the camera locations indicated by small icons. Viewers can access the entire database, whereas the online viewing room will be stocked with tranches of footage on a rolling basis.

The announcement came amid mounting pressure from the public and Jan. 6 defendants to get access to the security video. Former Speaker Kevin McCarthy (R-Calif.) earlier this year said he would release Jan. 6 video footage, but that commitment never resulted in the public getting direct access.

The viewing room setup and the plans to blur faces on video clips given to media or the public drew some fire on social media.

“Releasing batches of J6 CCTV is merely a way for Congress to pretend they are making the tapes public while holding back important footage they will ‘someday’ get to us in a ‘future’ batch,” Will Pope, a Jan. 6 defendant, wrote on X. “They gave it ALL to the FBI in January 2021! Americans deserve it ALL in one batch, too!”

Mr. Pope said blurring the faces of those shown in the downloadable videos will erode public trust. He called the Nov. 17 announcement a “publicity stunt.”

“Americans will never trust blurred and edited J6 footage,” he wrote.

Some commenters on social media asked how they can be sure the files posted online have not been altered.

During a Spaces online meeting on X, several of the more than 800 participants said they expect Google and YouTube to censor not only news about the Jan. 6 video releases but also any video clips people try to upload to social media. Others said they do not understand why the online viewing room does not have a download function.

Congressional sources said the public can request downloadable videos based on their research, but all clips are subject to committee approval and will be processed to blur the faces of identifiable persons.

Earlier this year The Epoch Times gained access to the Capitol Police database of nearly 1,700 cameras for Jan. 5 and 6. Based on research done on video terminals on Capitol Hill, the newspaper requested and was given dozens of individual clips that were used in the special report The Jan. 6 Tapes.

https://twitter.com/amuse/status/1725713948547133881

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Daily Energy Standup Episode #254 – Weekly Recap: Iran’s Oil Surge, EV Charging Challenges, and Global Dynamics Unveiled

Energy News Beat

Daily Standup Weekly Top Stories

Explainer: Iran’s expanding oil trade with top buyer China

Nov 10 (Reuters) – China’s oil imports from Iran have hit record highs as Iran ramps up output despite the threat of further U.S. sanctions. Existing sanctions were implemented over Iran’s nuclear programme, and U.S. […]

Oil and gas ‘not the problem’ for climate, says UK’s net zero minister

Oil and gas are “not the problem” for the climate, but the carbon emissions arising from them are, the UK’s net zero minister has told MPs. In words that suggested the UK could place yet […]

China LNG deals come at an environmental cost

China’s LNG deal-making has been gaining momentum, even amid international calls to pull back on gas development due to greenhouse gas (GHG) emissions and methane leakage problems. Chinese gas importers have increased long-term LNG contracts with both Qatar and […]

Top LNG importer China re-selling more cargoes, eyes trading gains

China, the world’s top importer of liquefied natural gas (LNG), is increasingly re-selling some of the super-chilled fuel to other Asian buyers as it looks to profit from price swings. Armed with a growing portfolio […]

PG&E files extension to keep Diablo Canyon operational

Pacific Gas & Electric has officially filed its relicensing application with the Nuclear Regulatory Commission to extend operation at the Diablo Canyon power plant for another 20 years. The multi-year process will not hinder the […]

Exxon to start lithium production for EVs in the US by 2027

HOUSTON, Nov 13 (Reuters) – Exxon Mobil (XOM.N) said on Monday it plans to start producing lithium from subsurface wells by 2027 to provide supplies of the key metal used in electric-car batteries and advanced electronics. Oil […]

I Visited Over 120 EV Chargers: Three Reasons Why So Many Were Broken

Los Angeles County has more public electric-vehicle fast chargers than any other in the country. WSJ’s Joanna Stern hit up 30 charging locations in a Rivian R1T and ran into problems at 40% of them. […]

Highlights of the Podcast

00:00 – Intro
01:06 – Explainer: Iran’s expanding oil trade with top buyer China
03:33 – Oil and gas ‘not the problem’ for climate, says UK’s net zero minister
05:52 – China LNG deals come at an environmental cost
08:09 – Top LNG importer China re-selling more cargoes, eyes trading gains
10:16 – PG&E files extension to keep Diablo Canyon operational
13:41 – Exxon to start lithium production for EVs in the US by 2027
16:49 – I Visited Over 120 EV Chargers: Three Reasons Why So Many Were Broken
19:58 – Outro

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Michael Tanner: [00:00:14] What’s going on? Everybody, welcome to a special edition of the Daily Energy News beat Standup here on this gorgeous Saturday, November 18th, 2023. As always, I’m your humble correspondent, Michael Tanner, coming from an undisclosed location here in Dallas, Texas, bringing you our weekly recap. As always, I hope you guys are having a great weekend. Always love this episode. We’ve got a lot to cover this week at two solo shows. I’m from Stu and myself. I’m only had two full shows that we shot Monday, Tuesday, a lot of great segments. Guys, I’m going to leave it up to the weekly recap for the team right now. Before we do that guys, again, www.energynewsbeat.com. The best place for all of your energy news Tip of the spear when it comes to the energy business, doing the team do a great job of curating that website. Check us out again. Email the show [email protected] Subscribe Rate and Review YouTube, Apple Podcasts, Spotify, wherever you get your podcast. Appreciate you guys. I’m going to leave it up to the weekly recap. We’ll see you Monday, folks. [00:01:05][50.8]

Stuart Turley: [00:01:06] Iran’s Expanding oil Trade with top buyer China. Michael. This one has got some stats in it that I didn’t know. And the existing sanctions, we know the Bidens have not you know, they’ve they’ve not enforce them. How much Iranian oil is China Buying is a huge thing. Tehran’s October output edged up to 3.17 million barrels per day. That’s net when Trump was in power, it was less than 500,000. Now that, you know, the Bidens have ignored it and just no st no enforcement for you. 3.17 and China’s imports are 1.45 million barrels per day from Iran. That’s net it seems nice. It’s a little bit less. Now. Here’s how does Iranian oil enter China? Michael Stews Dark Fleet lives except for two cargoes. December 20, 21 and January 22. China’s customs has not recorded any direct imports from Iran since December 2020. Then turn, turn. If anybody wanted to ask about how important Stu’s dark fleet is, there you go. [00:02:33][87.9]

Michael Tanner: [00:02:34] Well, no, in in, in. That is what again, you’ve been you’ve been on this for years now, so don’t hurt yourself. Patent yourself on the back. But it really comes down to measuring. The EIA and the IAEA aren’t looking at the dark fleet. So when they go and talk to you about demand, forecast estimates are, oh, something’s new, data is dropping here that we need to cover. What they’re lacking. Lacking is an understanding of exactly what this article is talking about. Except for two cargoes. China’s customs has not recorded direct imports from Iran since December 2020. And then that’s not. [00:03:07][32.5]

Stuart Turley: [00:03:07] Oh, yeah. So, you know, the the dark Fleet. And that’s why I think the energy news beat is such a great website and resources because if you look at all of the sources across the world, you can’t just go with one source. You can’t listen to the IEA or the EIA or even Biden or Republicans. You can’t listen to any you know, you got to have multiple sources. Hey, let’s go to the next one here. We’re going to fly over to the UK now. Oil and gas, not the problem for climate, says the UK’s net zero minister. This is pretty amazing. This falls on the grounds of the Prime Minister and the head cabana. What was it a month ago when he said he’s going to delay the transition to Eve and then was now about all these heads were going nuts And then that started the whole that that to me was one of the I think the catalyst. Everybody was realizing it. Now, this guy, Graham Stewart, I like his name. Graham Stuart said fossil fuel production was not driving climate change, but demand for fossil fuel was poor. Oil and gas are not the problem, but the carbon emission arising from them are. Now this guy is. I thought it was okay. It’s a play of words. If you really care about climate change, the last country you need to worry about is the UK. We’re not the problem. It’s encouraging others. Here’s the thing. It’s the hypocrisy that this brings out, and that is everybody, all of the climate protesters that are out there, I would love to see them not film themselves using their iPhones that require oil and gas in order to produce those things. So what are they going to use? [00:05:01][113.6]

Michael Tanner: [00:05:03] Yeah, I mean, it’s it’s it would be pretty hard to protest oil and gas without using any products that come from oil and gas. So, you know, you basically stand out there naked and get a wave around a tree branch. I don’t know. [00:05:16][13.2]

Stuart Turley: [00:05:16] But it would be pretty funny. 80 countries call for the phase out at COP 27. Now they’re trying to make the same demand at COP 28 and a couple of weeks in Dubai. I can’t wait for the circus in a couple weeks. At COP 28, I mean, you got minister. You get everybody from Dubai coming in there. You got everybody from Saudi Arabia. And I know that Kerry is going to go in there and nobody’s going to want to talk to him because the U.S. has lost so much global prestige. China LNG deal comes at an environmental cost. This is kind of funny, actually, Michael, just before I get into this, think about it. LNG is gas. Liquefaction of natural gas goes to a ship. That ship then chugs around the world and then gets declassified and then put into pipes. So let’s there’s a lot of transportation going on with that natural gas. Chinese gas importers have increased long term contracts with both Qatar and the U.S. by 50% since 2020 to both contracts, 40 million tons per year. That is a lot of LNG traveling around the oceans. Here’s where it gets pretty wild. It shot up 72,000 and 800 million cubic meters. Wow. They are expected to contract LNG supply for more than 100 mtpa by 2026. That’s nuts. Let’s come in here. The CO2 emissions. This is a quote down here from a carbon brief report. China. CO2 emissions are still increasing and we have returned to record levels. Really? It’s because all them coal plants that they’re putting in. [00:07:17][120.5]

Michael Tanner: [00:07:18] Exactly. I love this. This quote by LNG analyst Rob Rozanski. He’s from the Global Energy Monitor. I mean, this guy really gets paid to dig to give quotes like this. Switching from coal to natural gas probably improves local air quality, but gas fired power still produces harmful emissions linked to health impacts and premature deaths. I swear that guy got paid a salary to say that quote, That’s unbelievable. Signed me up. [00:07:42][24.4]

Stuart Turley: [00:07:42] Still. Oh, absolutely. And then factoring in the entire LNG lifecycle with methane gas leaks through the entire cycle, LNG chain and since methane is such a powerful greenhouse gas emitter, LNG has an outsized climate impact. That was from Rozanski. I got tickled at this one. Produce locally. You don’t have to ship around the world and become energy independent. [00:08:09][26.5]

Michael Tanner: [00:08:09] China on now becoming the largest importer of LNG. Looks like they’re doing some crazy stuff with it. [00:08:15][5.5]

Stuart Turley: [00:08:16] They’re doing the old shell game on as bad Doug would. Chinese customs data. There are some big numbers in here. Michael shows that they reloaded. 617,000 metric tons of imported LNG during the nine months of this year compared with the 576,000 tons. And here’s where it gets funny. It comes down into here. We need to pull all the levers when it comes to managing market swings, says Zheng. Yogi Bless You picks up PTI, global head of LNG, told Reuters. Here it comes down into here. China’s LNG receiving capacity is expected to expand 30% to nearly 182 million tonnes annually by 2025 from £139 million this year. Now here’s where it gets a little funny, is that they’re trading gas shipments and I think that this is actually a let me find the quote numbers in here. South Korea has been taking 27% of China’s reloads and it’s even been going to Europe. I’m trying to find where that number it was buried in here. Anyway, China is getting the orders and then shipping them off somewhere else. [00:09:40][84.2]

Michael Tanner: [00:09:41] Well, because as as as Zheng Yao, the global head of LNG, pointed out, you know, this is using these financial derivatives and developing infrastructure like regasification terminals and underground storage, help offset market volatility and improve overall supplies. So they’re doing things that, quite frankly, the U.S. should be doing, which was using their massive amount of infrastructure to obtain energy security at home. So as much as I’d love to hate China for this, they’re doing it. In order to keep energy prices low at home. So. Oh, absolutely. You know, don’t hate the player. Hate the game. [00:10:16][34.3]

Stuart Turley: [00:10:16] Agony. Any files and extension to keep Diablo Canyon operational. I find it funny that this was filed when President Z from China has come in. Oh, a miss producer. Can you fly in this thing here and let me get the hour? I found this on Twitter and I found it very interesting. This is from I want to give a Chuck Cohen a shout out and it’s before Z. And this is San Francisco with the homeless. You see the normal homeless after they ran through like goons beating the homeless and cleaning them up. Just like in Princess Bride when they went, I need my goon squad to clean everything up. They did. Okay, now, this is going to be the same thing, Michael. Here they are. They have lousy energy policies. President G shows up, and they’re going to add 20 years to Diablo Canyon. When? Michael, you and I were covering it. Two years ago, they were shutting it down. All we have to do is get president z to tour the united states. Chicago would be cleaned up. New York would be cleaned up. This would be huge. I’m a G. Fan. All of a sudden, since he can get California cleaned up just by showing up. This multiyear Diablo Canyon is just unbelievable. PG And he’s committed to answering the state’s call to ensure continued operation at the facility and safely delivered affordable, reliable and clean energy, said Patty Pope in a press release. She has to be our Person of the Week. [00:12:03][106.8]

Michael Tanner: [00:12:04] Yeah, I mean, you have to remember, for all of the flaws that we are forced down our throat from Diablo Canyon. Oh, it’s so bad. It’s so bad. It’s doing 10% of the state’s electrical supply is nothing to sneeze at. [00:12:15][11.4]

Stuart Turley: [00:12:15] No, it’s not an edge. Delivering less carbon than all of the oil that’s coming in from China’s wells out of the rainforest 24 hours a day, seven days a week, 365 rain or shine. I mean, I love me and you know. [00:12:35][19.4]

Michael Tanner: [00:12:35] You love it. And we do need we just need to g to take a tour of the United States. And it had me tickled. And then did you see me not to sidetrack, but I saw a clip today of Newsom saying, well, hey, I know a lot of you think we just cleaned up the streets because President G is here and he’s like, Wow. It’s true. It’s true. But we also did it because it was just he straight up just he admitted it. [00:13:00][24.6]

Stuart Turley: [00:13:00] What did you do? You remember when Biden made his first 15 minute drive by at the at the border, the border town? It was a wreck. They did the same thing. They brought the Princess Bride goon squad through, cleaned it up. You couldn’t find an illegal immigrant to save your life around the goon squad. And President Biden walked around with his bag. It depends under his arm, looking around, going, There’s no border crisis. Oh, just bring Biden and Z on a world tour around the U.S. and we would have no problem. [00:13:37][37.0]

Michael Tanner: [00:13:38] A world tour around the U.S.. I absolutely love it. [00:13:41][3.2]

Stuart Turley: [00:13:41] So let’s go ahead and transition over to Exxon. This is an outstanding story. When we take a look at the energy transition and the demand for the lithium for the lithium batteries, this is huge. And they are projecting that they can start producing lithium, Exxon, by 2027. The U.S. oil majors are investing in the electric ification sector as governments in the United States and Europe set programs to promote wider use of electric vehicles. While in the long term, lithium is really a global opportunity, said Dan Mann, president of Exxon’s Low carbon business Unit. We are starting here because there’s an urgent need to ramp up domestic production with these critical minerals. Let’s talk about some of this is goal would require $2 billion in capital expenditures to provide 50,000 tons at a volume. It could generate $800 million in cash. That doesn’t seem like a very good 2 billion capital expenditures in order to generate 800 million in potential cash, unless there is subsidies in here and unless there is long term contracts. The other part of this article is very critical. European oil rivals BP Shell have invested in the. Charging stations is part of their transition strategy. But BP and Shell and even total energy, as we talked about, total energy is just bought enough natural gas plants or is in the process of buying them In Texas, that is equivalent of two nuclear reactors. And when you take a look at the difference of the European big oil companies, they went 100% going to beyond petroleum, as in BP’s case, instead of maintaining their balance like the U.S.. The Exxon’s of the world stayed their course and then Oxy took it to carbon capture. So now Exxon, which invented the rechargeable lithium battery in the seventies, I did not know, then stepped away from the technology, has no and plans to invest in the charging stations. I thought that was pretty critical. Stay in your lane and this is very, very important. There are 280 million vehicles in the U.S. today and fewer than 3 million are these. There’s still 99% to go, which is a huge opportunity. So the headwinds for this project, A, I applauded the headwinds are going to be is the EV market going to be sustainable without the consumers being excited about it And or are the subsidies going to have to kick in? Stay tuned. We’re going to try to get a crayon on this with Michael and be back with you on this as well. [00:16:48][186.7]

Michael Tanner: [00:16:49] I visited over 120 EV chargers. Three reasons why so many were broken. This is, again, from the Wall Street Journal. I want to try to find the author here. It was a lady she wrote it on here. Either way. Oh, Joanna Stern. Okay. So she went ahead in Los Angeles and hit up 30 fast charging locations or public electric vehicle, fast charging locations in Los Angeles County. She did that in a rivian r1t and found that 40% of them had problems. So this is in public. The Chargers clearly not working out. You know, she says it’s a Ford Mustang Mach-e driver. I’m no stranger to these frustrations. Many of you have shared your charging horror stories and me since I began my EV adventure. So let’s go ahead and dive into this. They visited 30 EV charging stations, 13 of whom had issues. Here was the first problem. Some of them were just flat out of order. So of the 126 stalls that she inspected, 27 of them were out of order. They either had a sign I’m a dead screen ordered air, a reading, a test charger unavailable. A producer can can fly that in their charger unavailable out of service. Caution. Sorry. Out of service. Not good. All of these companies told me that they have network operators currently monitoring them. 24 seven And when problems pop up, they deploy technicians to assess and fix the issues of what was wrong with these particular machines. Could be one of many things. The key is it takes a while to get that turned around. Solution. I love how they always try to put a solution here. New gear is needed, obviously better gear that works. This is my favorite problem to paint it, reject it. You get it all worked out, but you can’t swipe your credit card. Technology has been around for decades. We can’t figure out how to get it on EVs. It’s just hilarious. What’s the solution? Upgrade the apps. Genius. Genius. Finally, the third one this is interesting and I think is is one of the reasons why scaling EVs from a regulatory standpoint might be necessary is the handshake failure, which is basically the connection to you and your EV to the fast charging doesn’t quite work for whatever reason. It could be a software issue, it could be a timeout, it could be a bunch of different things. To the point is you can get it connected. You pull up, it takes your car, but boom, it’s not transferring. And I mentioned this may be where in order to push some of this stuff forward, there needs to be a little bit of I don’t want to say government regulation, but in agreement among makers, can we create a single plug and play charger? I know that they’re working on it, but some people have different combinations. There’s the combined charging system that’s integrated into most non Tesla promises. Tesla is different, but most of non Tesla EVs including the Rivian, require a quick handshake. It basically it’s this new combines and so they’re working on it. It all comes back to the point we are really far away from EV rollouts and people want to go quickly and phase out gas vehicles when 14 I promise you 14% of gas stations are not offline. I just promise you that. So this is again, people talk about EVs don’t work. Well, the problem is that there’s a lot of downstream issues when it comes to EVs. Obviously, we’ve covered extensively the grid, but really this EV charges players 120 EV chargers, 40% of them out of work. Great work. Got to love it happened. [00:16:49][0.0][982.6]

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Why oil majors Shell and BP are combining solar energy and agricultural production

Energy News Beat

At Elm Branch Solar Farm, about an hour south of Dallas, Texas, a flock of sheep grazes among a vast field of solar panels. The flock’s shepherd, Amanda Stoffels, watches over it as the sheep munch on the grass and nap in the shade provided by the panels.

Stoffels owns this land, but leases it to Lightsource BP, a major solar energy developer that’s 50% owned by British oil major BP. She earns a steady monthly income from the lease payments as well as through her grazing contract with Lightsource, which pays her to graze her sheep around the panels, thereby keeping vegetation in check.

“It’s a new, modern approach to agriculture,” Stoffels says. Her contracts with Lightsource allowed her to quit her 9 to 5 job to become a full-time shepherd.

An emerging industry called agrivoltaics combines solar energy production with agricultural activities such as sheep grazing, beekeeping and crop growing. This land management strategy could help alleviate the tension between farmers and solar developers, groups that often have competing land-use interests.

“Even though the United States is a very large country with a lot of available land, every single square inch of land is either owned, protected or cherished by someone or many people. And many people do not want to see that land change or transform into something different from what it has been,” explained Jordan Macknick, the Lead Energy-Water-Land Analyst for the National Renewable Energy Laboratory.

Agrivoltaic projects, Macknick says, could be a sort of compromise. “So agrivoltaics really offers us that opportunity to continue farming, continue doing these agricultural activities while also producing clean electricity.”

Amanda Stoffels feeds her flock of sheep at Elm Branch Solar Farm in Ellis County, Texas. Stoffels earns money by leasing her land to solar developer Lightsource BP and grazing her sheep around the panels.

Crop growing on solar farms is still a nascent area of research and some farmers still have concerns.

“Solar takes some of the best land out of production because they want land that’s 1% to 4% slope,” explained Tom Koranek, a landowner and beekeeper who leases land to Lightsource and produces honey on the solar farm. That flat, treeless land is ideal for both solar panels and crop production, he says.

Still, agrivoltaic projects are as close to a win-win for farmers and solar developers as we currently have, and as the solar industry rapidly expands, experts say we can expect to see agrivoltaics expanding right alongside it.

Opening up new markets

The nation will need to build out a massive amount of utility-scale solar to meet its decarbonization goals. Given that agricultural land comprises 44% of the U.S.′ total land area, many solar developers are looking to cite new projects on farms.

“For solar developers, I think the attraction of agrivoltaics is largely that it helps with community acceptance and community excitement about solar projects” explains Becca Jones-Albertus, Director of the U.S. Department of Energy’s Solar Energy Technologies Office. “Grazing land in this country is about a third of all of our land use. And if you’re able to make that a dual use with solar energy production, you have now opened up a huge potential market space that wasn’t open before.”

Today, the U.S. has about five gigawatts of agrivoltaic projects, encompassing more than 35,000 acres across over 30 different states. While this only represents about 3% of the country’s installed solar capacity, it’s a growing industry, and farmers are taking note.

“It’s a much better financial contribution than growing crops,” said Koranek about leasing his land to Lightsource. “Crops are very risky. So some years you may make a good return and other years you may not. And so this is a steady income year every year.”

Lightsource operates a combined 615 megawatts of sheep grazing and solar power projects, around 12% of the nation’s entire agrivoltaic portfolio. The company plans to add an additional 1,058 megawatts worth of projects next year.

Shell is also involved in the space through its 44% stake in solar developer Silicon Ranch. The ranch operates 1,300 megawatts of agrivoltaic projects with an additional 900 megawatts planned over the next two years.

While most solar developers opt to lease land, Silicon Ranch buys it outright, often purchasing degraded farmland that’s no longer in production.

“We want to tell these communities that we are committed for the long haul, and we’re going to become members of these communities in meaningful ways,” said Silicon Ranch’s Co-Founder and CEO, Reagan Farr. “So our business model of owning real estate was a function of how we viewed this asset class.”

Like Lightsource, Silicon Ranch pays local ranchers to graze sheep on their solar farms. But Farr says the company has encountered a sheep shortage, leading Silicon Ranch to invest in its own flock, which it plans to grow to over 30,000 by 2030.

While there are other players in the domestic agrivoltaic market such as Enel Green Power and US Solar, Lightsource and Silicon Ranch remain the largest players in the space. American oil majors such as Chevron and Exxon haven’t invested in agrivoltaics.

Solar plus crop production

While it’s relatively well understood how to graze sheep and create pollinator habitats among solar panels, it’s a trickier prospect to grow crops below and between the panels.

Many crops such as tomatoes and broccoli can theoretically grow beneath solar panels, but the design of the solar array usually needs to be altered, often by elevating the panels so that crops can reach their full height. That gets costly, and while the economics can work for small-scale projects in markets with strong solar incentives, scaling up is a challenge.

“I would say given the existing cost of PV technology, given the existing energy markets that we have in the United States, it will be very challenging to see crop production agrivoltaics happen at a scale bigger than five megawatts at a time,” says Macknick.

But even if we won’t see utility-scale crop production and solar energy projects anytime soon, there’s still a lot of energy in this space. The Department of Energy is currently funding six agrivoltaic projects, with the goal of enabling the deployment of over 1 megawatt of projects focused on crop production, and over 10 megawatts of projects focused on grazing and pollinator habitats.

Lightsource BP says it’s interested in getting into crop production, hoping that one of its sites can serve as a test project next year. Farr says Silicon Ranch isn’t pursuing partnerships yet. But whatever route both companies, and their oil industry backers, take, community relationships and mutually beneficial land-use arrangements are going to be paramount.

“We need to bring value to the communities where we site these solar arrays, or we’re going to lose our social license to operate. And that’s going to hurt our ability to meet some of these very aggressive, renewable energy goals that we have as a country,” said Farr.

Source: Cnbc.com

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California’s hydrogen fuel shortage hits three-month mark, with filling stations still offline and no end in sight

Energy News Beat

It has been three months precisely since a “disruption” to the supply of gaseous hydrogen to filling stations in Southern California was first revealed — and the problem continues to persist, with no end in sight.

Data from the Hydrogen Fuel Cell Partnership shows that 23 of the state’s 53 filling stationd were offline at the time this article was published, including 15 out of 29 in the sprawling Greater Los Angeles area.

On 13 August, the state’s largest hydrogen fuel supplier, True Zero, wrote in a letter to customers that ten of its filling stations in the south of the state had seen their fuel supply stopped due to their supplier experiencing “a major service disruption”.

All ten still have no supply of H2, while a further two Iwatani filling stations are also reporting the same problem. Both companies are still saying they do not know when the supply of hydrogen will resume.

The remaining 11 offline hydrogen filling stations either have technical problems or fuel shortages that are not known to be related to the supply disruption in Southern California.

On Friday, hydrogen equipment supplier Plug Power blamed the general lack of available H2 in California as one of the reasons the company underperformed in the third quarter.

Source: Hydrogeninsight.com

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