Utilities, trade unions and Germany’s federal and regional policy makers have agreed a landmark €40 billion deal to phase out all coal-fired power plants by 2038. The latest coal exit adds to the earlier agreed nuclear exit, under a scheme to compensate electric utilities, workers and coal-mining regions.
Self-reliance of German electric vehicle produces needs to increase substantially, according to government advisors. "If the need to import battery cells and e-cars grows in line with the roll-out, effects on the employment would be significant," analysts noted. Under the most pessimistic scenario, there could be up to 410,000 fewer jobs in the sector by 2030.
Germany’s second largest utility RWE could receive up to two billion Euros in compensation for closing its lignite power station under a coal exit agreement currently drawn up by the economy ministry. The Czech energy holding EPH, however, is asking for significantly more compensation for its power assets in eastern Germany than the government is willing to pay.
Adani Power and NTPC, two of India’s largest power producers, have pleaded to the government in Delhi to extend the deadlines of retrofitting coal power stations by two to three years. High costs for retrofits and India’s continued reliance on cheap thermal coal now needs to be weighed up against rampant air pollution.
‘Wider Access’ – the latest project launched by National Grid ESO to increase accessibility to the UK balancing mechanism – is already attracting new market entrants. Aggregated power units, notably hybrid and battery-based units, are increasingly being dispatched in this regulated market, providing the grid operator with much-needed flexibly.
While global climate talks in Madrid ended with lackluster results, German lawmakers agreed to raise the entry-level price for CO2 emissions from the buildings and transport sector from 10 Euros to 25 Euros starting from 2021. Thereafter, it will rise to 55 Euros by 2025, with state revenues to be used to lower the renewables levy on consumers' electricity bills.
The new President of the European Commission, Ursula von der Leyen, has come forward with an ambitious ‘EU Green Deal’ that seeks to outdo the ‘Green New Deal’ proposed by the U.S. Government. The European Green Deal envisages Europe to become “climate-neutral” by 2050, which requires a 55% cut in greenhouse gas emissions by 2030, replacing the current 40% goal.
Efforts to develop Vaca Muerta, Argentina’s vast shale reserves in northern Patagonia, have slowed as national energy companies await direction from the incoming President. Alberto Fernández, who will take office on December 10, has yet to decide whether to keep focused on pushing up domestic oil and gas production and LNG exports.
News in Brief
Siemens to service Kalamkas gas turbines
June 4 – JSC Mangistaumunaigaz, one of Kazakhstan’s largest oil and gas producers, has contracted Siemens to service two STG-800 gas turbines at a power plant, designed to meet the entire energy needs of the nearby Kalamkas oil and gas field. The nine-year contract covers turbine maintenance and eventual upgrades as well as remote monitoring of operations.
NamPower to invest $575m on grid expansion
June 3 – Namibia’s state-owned utility NamPower is planning to spend $575 million over the next three years in upgrading and extending its power transmission infrastructure. Namibia imports 60% of its total electrical energy requirement, primarily through bilateral contracts from South Africa’s Eskom and to a lesser extent, the Southern Africa Power Pool (SAPP).
UK TSOs call for £900m green gas investment
June 2 – Britain’s five gas network companies – Cadent, National Grid, NGN, SGN and Wales & West Utilities – have urged the Government to unlock over £900 million (€1bn) for new green gas infrastructure. Research by the Energy Networks Association (ENA) shows that if investment into zero-carbon hydrogen infrastructure started today, the UK could save energy bill payers £89 billion (€99.2bn) by 2044 – five years prior to its 2050 net-zero targets.
Exxon, INNIO about to launch gas engine oil
June 1 – ExxonMobil and INNIO have announced the imminent launch of their first co-engineered and co-branded natural gas engine oil. The U.S. oil major and the Austrian engine maker have just extended their global lubricant collaboration agreement for INNIO’s Jenbacher Type 2, 3, 4, 6 and 9 natural gas engines.
BelGAS launches new pressure regulator
May 29 – BelGAS has introduced its new P1098 High-Capacity Pressure Reducing Regulator, a large-volume regulator for natural gas, propane and other fuels. The pilot-operated device has a large-area actuator diaphragm, allowing for fast and accurate response to modulating gas flow conditions. It is adaptable for low to extra-high pressure—up to 400 psi main valve inlet.
GE to sell lightning business
May 28 – GE has signed a definitive agreement to sell its lighting business to Savant Systems, a provider of smart homes. CEO H. Lawrence Culp called the divestment “an important step in the transformation of GE into a more focused industrial company.” The transaction is expected to close in mid-2020.
China’s fuel demand recovers
May 27 – The Chinese government has lifted restrictions on private travel since April which pushed up demand for transport fuels. Gasoline demand has recovered particularly fast and is expected to return to last year’s levels by June 2020. Wood Mackenzie estimates gasoline consumption to reach 3.4 million barrels per day (b/d) in the second quarter, down just a 0.8% year on year. Diesel or gasoil demand is expected to reach 3.4 million b/d in Q2 2020, a 3% decline year-on-year. Overall, China’s oil demand is seen rise a “modest” 13.6 million bpd, or 2.3%, in the second half of 2020.
Wärtsilä to retrofit CHP in Spain
May 26 – The Finish engine maker Wärtsilä has bagged an order to supply and install a 34SG gas-fuelled engine generating set for Rofeica Energia's combined heat and power plant in Barcelona, Spain. The installation of the gas engine will allow Rofeica to switch the CHP from heavy fuel oil to gas-fuelled operation, reducing emissions.
New York body rejects William’s plans for gas pipeline expansion
May 21 – New York’s and New Jersey’s state bodies for environmental conservation have rejected Williams’ plans for the Northeast Supply Enhancement project, designed to transport 400 million cubic feet per day of gas from Pennsylvania to New York. The state bodies had already denied wetland permits in 2019, but Williams pipeline subsidiary Transco filed another application with the U.S. Federal Energy Regulatory Commission (FERC), arguing firm services under the project were agreed with UK’s National Grid for customers in New York City districts of Brooklyn, Queens, Staten Island and Long Island.
UK inflation at 4-year low amid falling energy costs
May 20 – The rate of inflation in the UK has fallen to a four-year low as the pandemic pushed down global oil and fuel prices which translate into lower wholesale power prices. The consumer price index fell to an annual rate of 0.8% in April, down from 1.5% in March, according to the Office for National Statistics.
Deficit grows in German green energy fund
May 19 – German regional grid operator TransnetBW has warned of a growing shortfall in the country’s fund for green energy sources, financed under the so-called renewable energy (EEG) levy. TransnetBW, the TSO in southwest Germany, said “due to the EEG cost allocations defined for 2020, we anticipate there will be a negative year end bank account balance in the high three-digit million euro range for 2020.”
Spanish gas companies ‘resilient’
May 18 – Spain’s regulated gas companies “should prove to be resilient” to external shocks arising from coronavirus containment measures, Standard & Poor’s analysis finds, calculating with an average drop in EBITBA at less than 3% in 2020. A new remuneration framework for 2021-2026, recently enacted by the Spanish government, provides enhanced visibility rated grid operators amid the pandemic.
German electricity prices second highest in EU
May 15 – Taxes and the renewable energy surcharge have pushed up Germany’s household electricity prices to the second highest level in Europe, topped only by prices in Denmark. While Danish households paid 29.2 Euros per 100 kWh on average in the second half of 2019, prices in Germany averaged 28.7 Euros, according to the EU statistics office Eurostat.
Calpine’s Q1 earnings fall
May 14 – Calpine, America’s largest generator of electricity from gas and geothermal, has reported a net income of $128 million for the first quarter of 2020, down from $175 million in the prior year period. Lower commodity margins and unfavourable change in income taxes were partially offset by earnings from hedge positions for the three month ending March 31.
Siemens to supply hybrid plant in the Philippines
May 13 – Berkley Energy has contracted Siemens Energy to build a hybrid power project on the island of Mindoro in the Philippines. The project links 16 MW wind power with battery storage, stabilizing energy supply in a remote location with a weak link to the grid and reducing its dependence on diesel.
U.S. energy emissions fall
May 12 – Energy-related carbon emissions in the United States have fallen more than energy consumption, down 2.8% over the course of last year to 5,130 million metric tons (MMmt). Power sector emissions were down 145 MMmt, due to a switch from coal to gas and renewables. In April 2020, emissions experienced another unprecedented fall in due to Covid-19 lockdowns.
MAN expands Omincare concept
March 11 – MAN Energy Solutions’ service brand has extended its ‘PrimeServ Omnicare’ concept from turbomachinery to the marine and power segments. The one-stop service solution is now also applicable for maintenance of third-party machinery, including engines, turbochargers and related auxiliaries.
