The intensifying trade war between the US and China is starting to impact shipments of US LNG to China and slows Beijing’s efforts to switch from coal to gas use in the power sector. Only four US LNG cargoes have been delivered to China since September, when a 10% tariffs came into effect. Now, Beijing hiked this levy to 25% - in retaliation to Washington’s move to expand import tariffs on Chinese goods.
US demand for coal to generate electricity will keep falling in the coming months, federal officials said Thursday. This is despite President Trump’s efforts to shore up the struggling industry. Renewable energy sources including wind, solar and hydropower are expected to fill much of the gap left by coal's decline, according to the Energy Information Administration (EIA). However, natural gas is expected to remain the fuel of choice for power generation with an expected 40% share of US markets this summer.
China’s switch from coal to gas, to de-carbonise its energy mix and tackle pollution under its Blue Sky policy, requires importing considerably more gas imports and investment in related infrastructure, DNV GL said in a report. Gas currently accounts for only 7% of China’s energy mix, compared to a global average of 22% – but the Chinese government aims to boost that share to 10% by 2020, and as much as 15% by 2030.
This week, the UK’s National Grid claimed it had produced electricity without using coal for seven days. The UK pioneered the use of coal-fired power stations back in the 1880s and became a prolific user of coal as well as a major exporter, which lasted for nearly a century. “As more and more renewables come onto our energy system, coal-free runs like this are going to be a regular occurrence," said Fintan Slye, director of National Grid Group’s Electricity System Operator.
Siemens is to spin-off its Gas and Power (GP) division as part of the next phase in its ‘Vision 2020+’ plan. The plan involves creating a major new player in the energy market with a business volume of €30 billion and over 80,000 employees through the spin-off and the transfer of Siemens’ SGRE stake.
Britain’s energy needs may be entirely covered by non-fossil fuels for short periods starting from 2025, National Grid said, stressing it aims to be “zero-carbon capable” by then. To achieve this goal, flywheels and supercharged capacitator technology need to be deployed to ensure the grid has the necessary resilience, known as inertia.
Occidental Petroleum has sweetened its buyout bid for Anadarko, now offering 78% cash and 22% stock rather than a 50:50 split, in an effort to outbid Chevron. Anadarko reacted by stressing the Chevron Merger Agreement is still valid, but analysts reckon the revised terms and Occidental’s pledge to sell Anadarko’s Mozambique LNG stake to Total could force Chevron to improve its offer.
NRG Energy’s latest quarterly earnings came in at $0.34 earnings per share (EPS) for the quarter, just below analysts’ estimate of $0.39. During the second quarter of 2019, the utility accumulated revenues of $2.17 billion, up 4.8% compared to the same quarter last year. Return on equity was 129.32% that quarter, resulting in a net margin of 2.58%.
The French oil major Total has announced plans to invest between $1.5 billion and $2 billion per year on low-carbon power sources in a strategic shift to the retail energy sector. CEO Patrick Pouyanne said the Group’s target of 7 million retail energy clients in France and Belgium, equaling about 15% of the market, would be achievable before 2022.
Neonenergia, a Brazilian electric utility with 4.5 GW installed capacity and majority-held by Iberdrola, has started a second attempt for an IPO after it had to call off an effort to get listed on the Sao Paulo Stock Exchange in 2017. Iberdrola shareholders now hope for higher price in the IPO, based on Neonenergia’s improved results since its merger with Elektro.
Although the owners of three new Dutch coal power stations – ENGIE, RWE and Uniper – are burdened with around €4 billion in losses due to market headwinds and a mandated coal phase-out, only ENGIE has chosen to divested its assets. RWE and Uniper, in contrast, seek compensation for shutting down their plants which risks delaying the shift to clean energy in the Netherlands.