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15/04/16
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Europe’s Green Mega-Flop
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Hundreds Of Windmills Operating At A Loss, Facing Demolition
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Hundreds of wind turbines in the Netherlands are operating at a loss and are in danger of being demolished. The main cause is the very low energy prices, which mean that the maintaining the turbines cost more than what the generated energy bring in, the Financieele Dagblad reports based on own research. Subsidies for generating wind energy are in many cases no longer cost-effective. Smaller, older windmills in particular are running at a loss, but even newer mills are struggling to be profitable with insufficient subsidies. --Janene Pieters, NL Times, 15 April 2016
Due to the low energy prices wind turbines are making losses on a large scale. The maintenance costs are higher than the benefits of the energy generated. Windmills are now being demolished according to a survey by Financieele Dagblad. According to estimates Association of Private Wind Turbine Operators (Pawex) 'potentially 500 to 750 megawatts' are making a loss or are at risk of doing so. That is a quarter of the power generated by onshore wind energy in the Netherlands. --Carel Grol, Financieele Dagblad, 13 April 2016
1) Europe’s Green Mega-Flop: Hundreds Of Windmills Operating At A Loss, Facing Demolition
NL Times, 15 April 2016
2) Lights Go Out On Solar Power After British Government Cuts Subsidies
The Guardian, 8 April 2016
3) Britain’s £3 Billion Climate Policy Blunder Exposed
Reuters, 13 April 2016
4) Germany’s Energiewende: ‘One Of The Most Monumental Blunders Of Modern Governance’
The Wall Street Journal, 14 April 2016
5) Indian Banks Wary Of Solar As SunEdison Totters
Live Mint, 13 April 2016
6) Solar Is Not The Future Of Energy
Seeking Alpha, 3 April 2016
The amount of household solar power capacity installed in the past two months has plummeted by three quarters following the government’s cuts to subsidies, according to new figures. The size of the drop-off will dismay green campaigners who want take up on clean energy sources to accelerate. The cuts were announced just days after energy secretary Amber Rudd helped agree the historic Paris climate deal, and have bankrupted several solar companies. The government says the changes were necessary to protect bill payers, as the solar incentives are levied on household energy bills. -- Adam Vaughan, The Guardian, 8 April 2016
A British government scheme costing energy firms 3 billion pounds to help people save money on their bills and cut greenhouse gas emissions has not provided value for money, a parliamentary watchdog said. --Reuters, 13 April 2016
Germany’s 16-year-old Energiewende, or energy transformation, already has wrecked the country’s energy market in its quest to wean the economy off fossil fuels and nuclear power. All of this—the job losses, the unreliable power supply, the astonishing amounts of spending that could top €1 trillion over the coming decades, and the rising coal emissions to boot—amounts to one of the more monumental blunders of modern governance. Berlin likes to think of itself as a green-energy example to the rest of the world. It sure is. --Editorial, The Wall Street Journal, 14 April 2016
Indian lenders are becoming increasingly reluctant to finance solar-power projects by foreign companies as bankruptcy looms for SunEdison Inc. in the US, creditors familiar with the matter said. That’s a threat to Prime Minister Narendra Modi’s goal of a roughly $100 billion expansion of solar power, aided by foreign investment, a target he set for energy security and to curb fossil-fuel pollution. Indian bankers are sensitive to heightened risk as they grapple with the nation’s worst bad-debt pile up in more than a decade after infrastructure investments soured. --Anindya Upadhyay and Anto Antony, Live Mint, 13 April 2016
Solar cannot survive without government subsidies. Take away the punch bowl and the sector collapses. Solar cannot compete with fossil fuels. It is not clean, nor is it renewable. --Will Ebiefung, Seeking Alpha, 3 April 2016
1) Europe’s Green Mega-Flop: Hundreds Of Windmills Operating At A Loss, Facing Demolition
NL Times, 15 April 2016
Janene Pieters
Hundreds of wind turbines in the Netherlands are operating at a loss and are in danger of being demolished. The main cause is the very low energy prices, which mean that the maintaining the turbines cost more than what the generated energy bring in, the Financieele Dagblad reports based on own research.
Subsidies for generating wind energy are in many cases no longer cost-effective. Smaller, older windmills in particular are running at a loss, but even newer mills are struggling to be profitable with insufficient subsidies.
This is extremely worrying, according to the paper, seeing as the Netherlands is already behind in meeting green energy targets set in the Energy agreement.
Teun Bokhoven, chairman of umbrella organization for sustainable energy companies, thinks that the subsidy arrangement need to change, he said to BNR.
The current subsidies are based on long-term forecasts and do not take the current low energy price into account.
Full story
2) Lights Go Out On Solar Power After British Government Cuts Subsidies
The Guardian, 8 April 2016
Adam Vaughan
The amount of household solar power capacity installed in the past two months has plummeted by three quarters following the government’s cuts to subsidies, according to new figures.
A fall in solar power was expected following a 65% reduction in government incentives paid to householders, but the size of the drop-off will dismay green campaigners who want take up on clean energy sources to accelerate.
Data published by the energy regulator this week shows there was 21 megawatts (MW) of small solar installed in February and March this year, after a new, lower incentive rate came into effect. By contrast, energy department figures show that for the same period in 2015, 81MW was installed.
The cuts were announced just days after energy secretary Amber Rudd helped agree the historic Paris climate deal, and have bankrupted several solar companies. The government says the changes were necessary to protect bill payers, as the solar incentives are levied on household energy bills.
Full story
3) Britain’s £3 Billion Climate Policy Blunder Exposed
Reuters, 13 April 2016
A British government scheme costing energy firms 3 billion pounds to help people save money on their bills and cut greenhouse gas emissions has not provided value for money, a parliamentary watchdog said.
The report, by the National Audit Office (NAO), said “neither we nor the Department (of Energy and Climate Change) can determine the impact of the schemes on fuel poverty”, while the average cost of cutting just one tonne of carbon dioxide (CO2) was around 94 pounds, almost three times the cost of earlier schemes.
The country has some of the most energy inefficient homes in Europe and the measures had been expected to help the country meet its greenhouse gas reduction targets.
The government is also under pressure to curb rising energy bills with 2.3 million of Britain’s 27 million households deemed fuel poor, meaning the cost of heating their homes leaves them with income below the poverty line.
Since 2013 power suppliers are required to install energy efficiency measures such as loft insulation in some of their most vulnerable customers’ homes under the government’s Energy Company Obligation (ECO).
The NAO said ECO had cost energy suppliers 3 billion pounds from 2013 to 2015 and improved the energy efficiency of 1.4 million homes. By the time the scheme ends on 31 March 2017 it is expected to save 34 million tonnes of CO2.
Under a separate initiative, The Green Deal, the government offered homeowners loans to pay for green products such as energy-efficient boilers, but uptake was slow and the project was scrapped last year.
The NAO report said the scheme cost taxpayers 240 million pounds with just 14,000 homes benefiting from improvements.
Full post
4) Germany’s Energiewende: ‘One Of The Most Monumental Blunders Of Modern Governance’
The Wall Street Journal, 14 April 2016
Berlin’s renewable energy fiasco is about to get even worse
Germany has spent some €200 billion ($228.09 billion) since 2000 transforming its energy industry into a green dream, and now Berlin wants to spend more. Witness its latest attempt to discourage investment in wind power, which happens to be the only renewable energy generation that makes even vague sense for Germany.
A review now under way of the 2014 renewable-energy law could change the way Berlin chooses new generating capacity. The current system of subsidies and feed-in tariffs (requirements that utilities buy renewable electricity at above-market prices) has led to a bonanza of solar- and wind-farm construction, and renewables now provide one-third of electricity generated in Germany.
The renewables never seem to fall in price the way boosters promise, and with costs skyrocketing Berlin needs a cheaper way to boost renewable capacity to its self-imposed goal of 45% of electricity generation by 2025.
The proposed solution is a bidding system in which renewable producers would compete for the right to produce a share of the planned new green capacity based on who can offer the lowest price. An auction process is supposed to make green energy more affordable. But Berlin wants to exclude new wind producers from this auction, at least as long as other producers such as solar are available. This despite—or perhaps because of—the fact that wind is the cheapest form of green power in Germany.
It makes you wonder if there’s any form of energy-price signal that governments won’t ignore. Germany’s 16-year-old Energiewende, or energy transformation, already has wrecked the country’s energy market in its quest to wean the economy off fossil fuels and nuclear power. Traditional power plants, including those that burn cleaner gas, have been closing left and right while soaring electricity prices push industries overseas and bankrupt households. Job losses run to the tens of thousands.
Now the effort to suppress additional wind-power development threatens to make matters worse. By favoring solar, Berlin would be picking the power source that most exacerbates the problems with the energy transformation. It’s the most expensive, requiring the greatest subsidies—at least €116 billion in today’s prices over the lifetime of the solar capacity built between 2000 and 2014. Germany has a climate and geography with about as much sunshine as Alaska, so solar is also the least reliable renewable. […]
All of this—the job losses, the unreliable power supply, the astonishing amounts of spending that could top €1 trillion over the coming decades, and the rising coal emissions to boot—amounts to one of the more monumental blunders of modern governance.
Berlin likes to think of itself as a green-energy example to the rest of the world. It sure is.
Full post
5) Indian Banks Wary Of Solar As SunEdison Totters
Live Mint, 13 April 2016
Anindya Upadhyay and Anto Antony
New Delhi/Mumbai: Indian lenders are becoming increasingly reluctant to finance solar-power projects by foreign companies as bankruptcy looms for SunEdison Inc. in the US, creditors familiar with the matter said.
Lenders in the Indian economy are hesitating as the world’s biggest renewable energy company totters and record-low Indian solar tariffs stoke concern that projects could struggle financially, the three people said, asking not to be identified citing the sensitivity of the topic.
That’s a threat to Prime Minister Narendra Modi’s goal of a roughly $100 billion expansion of solar power, aided by foreign investment, a target he set for energy security and to curb fossil-fuel pollution. Indian bankers are sensitive to heightened risk as they grapple with the nation’s worst bad-debt pile up in more than a decade after infrastructure investments soured.
SunEdison, facing potential technical defaults on at least $1.4 billion of loans and credit facilities, is seeking to sell as much as 1 gigawatt of unfinished projects in India. TerraForm Global Inc., a holding company founded and controlled by the clean-energy developer, in a lawsuit filed 3 April in Delaware alleged SunEdison misused $231 million earmarked for projects in India.
One of the people, from an Indian bank, said it’s unclear how much debt owed by SunEdison the bank will recover. Another lender said it’s owed about Rs.100 crore ($15 million) and is cautious about financing projects won at very low tariffs.
Ben Harborne, a SunEdison spokesman in California, didn’t immediately address a request for comment. Pashupathy Gopalan, SunEdison’s president in the Asia-Pacific region, didn’t immediately reply to an email seeking comment on debts in India.
Some 40 lenders have sanctioned Rs.71,200 crore of financing for renewable energy projects in India, with Rs.29,500 crore of that amount disbursed from February last year through to 21 March 2016, according to government data.
Full story
6) Solar Is Not The Future Of Energy
Seeking Alpha, 3 April 2016
Will Ebiefung
Solar cannot survive without government subsidies. Take away the punch bowl and the sector collapses. Solar cannot compete with fossil fuels. It is not clean, nor is it renewable
I recently made an article on the topic of SunEdison (NYSE:SUNE) and renewable energy in general:
seekingalpha.com/article/3962472-sunedis…
This article received massive backlash, some of which was reasonable but most of which came from SUNE investors who are unwilling to accept the fact that they made bad investment. Instead taking every criticism of the company as a personal attack.
Many asserted that my position is incorrect, under researched and underdeveloped. They argue that renewable energy does in fact have a future and that I just don’t have all the information. Well I am here to reiterate: No it doesn’t. At least not in solar energy. SUNE was the canary in the coal mine for an industry that is fundamentally unsound. I will present to you the numbers that led me to this conclusion and let you decide for yourself.
The first rule of investing is to make decisions with your mind not your heart. Investing with your emotions is the best way to lose your money. While I love the environment as much as anyone it is simply not logical to let this feeling drive me to make unsound investments.
(NYSEARCA:TAN) the solar energy based ETF.
TAN data by YCharts
- Solar cannot survive without government subsidies. Take away the punch bowl and the sector collapses.
- Solar cannot compete with fossil fuels.
- Solar energy is not clean, nor is it renewable.
Betting on solar is betting on politics:
This is an industry where the government picks the winners and losers and when Uncle Sam leaves the room everyone will collapse.
We saw how the government killed YingLi Solar (NYSE:YGE) with protectionist policies. Subsidizing domestic companies at the expense of this Chinese producer.
And soon politics will kill all the rest.
The federal government has provided wind and solar developers with as much as 24 billion dollars in subsidies between 2008 and 2014. This subsidy is set to end in 2016. Panic that the punch bowl would be taken away was the MAIN factor that pushed SUNE and its rivals into frantic spending sprees, developments and acquisitions. Driving them into debt and towards eventual collapse.
Bloomberg New Energy Finance (BNEF) expects solar installation production to drop by as much as 70% when the government subsidies end.
This is estimated to cost the solar industry 100,000 jobs and end 25 billion dollars of economic activity. Worst off all, when solar energy welfare is gone how on earth will they compete with their number one rival?
Solar energy cannot compete with fossil fuels. Not now not ever:
As the events of 2015 and 2016 have demonstrated peak oil is a myth. The day when the world runs out of fossil fuels is extremely far away and most likely long past any of our lifetimes.
Without subsidies solar energy is 40% more expensive than fossil fuels. The price of oil has demonstrated that is it capable of falling further than anyone would have imagined 10 years ago when the frantic push and over-investment in renewable energy began.
Full post
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