1) UK: Missed renewables targets & record power crunch
The National Grid thinks it’s likely that Britain will miss its 15% renewable energy target by 2020, reports Bloomberg.
In its Future Energy Scenarios, the country’s grid operator found only one in which the EU target is met – a ‘gone green’ projection that requires the continuation of onshore wind subsidies and other incentives the government has thus far been scrapping and capping.
Ben Goldsmith, Chair of the Conservative Environment Network, fears for the future of renewables investment, writing in an Financial Times op-ed that the government’s energy policies – such as the removal of the climate change levy exemption – will make it hard for renewables to get bank capital, and will plunge the industry into uncertainty.
The National Grid report also warned that the closure of three power stations since last winter has increased the risk of blackouts, with The Telegraph reporting that the ‘safety buffer’ between peak electricity demand and output from the UK’s ageing power stations will fall from 4.1% last year down to 1.2%.
That number rises to 5.1% (still down from 6%) when you take into account the back-up power plants paid millions to stay online via the capacity market.
But, according to the government’s task-force on shale gas, there’s always fracking. Provided the practice is tightly regulated and monitored, hydraulic fracturing in the UK should be safe, the task-force said.
Its chief, Lord Smith of Finsbury, however, said it’s too early to say if fracking would be a ‘good thing’ for the UK, reports the Guardian.
2) Fracking: Natural gas knocks off coal as US leading power source
For the first time, natural gas has displaced coal as the largest source of electricity in the US, reports Think Progress.
Where natural gas, much of it shale from the country’s fracking boom, delivered 31% of the electricity generation in April, traditional powerhouse coal produced 30%, EIA data has revealed.
And China’s getting involved in the exporting of America’s glut of gas, providing tankers to take 800,000 tonnes of shale gas a year from the US to Europe, reports Chinese state media.
But it’s not all good news for frackers. BHP Billiton, the world’s largest miner, has had to take a $2 billion write-down following a review of its shale assets, reports the FT.
3) Iran: The nuclear deal’s impact on oil prices
As the rest of the world focuses on the significant diplomatic and geopolitical implications of a the Iran nuclear deal, we’re here to look at the energy.
Brad Plumer from Vox has given his take on what the whole thing could mean for oil prices, since Iran has the world’s fourth largest oil reserves. He notes that the removal of sanctions that will allow Iran to export its oil won’t take affect for six months, so we’re unlikely to see a flurry of market activity.
And Bloomberg’s oil analysis backs that up, describing the market’s reaction as “blah”.
One Wall Street Journal article observes that Iran’s hope to ramp up oil production and exports couldn’t have come at the worse time for the oil markets, with the price still very low with the US and OPEC pumping out record amounts. If Iran enters the game, it could well push oil prices even lower.
Another Wall Street Journal piece identifies the big winner from the deal as China, which has been carefully nurturing an oil trade as negotiations progressed; it grew 30% last year.
In other news:
Arctic: Shell’s broken icebreaker (which we break-down here) is en route to Portland, Oregon to be repaired as the oil giant says they’ll go ahead with exploration so long as they don’t enter the undersea oil and gas zone, reports Reuters.
Wildfires: They’re getting worse, says the Carbon Brief.
Climate change: Most of Africa and Latin America see climate change as the largest global threat, but the threat is highly politicised in the US and UK, a survey from Pew Research has revealed.
Paris 2015: Australia and India are expected to make their UN climate pledges in August, reports RTCC.
Mexico: And today is D-Day for Mexico’s grand energy reforms, in which private companies will be granted access its oil reserves, reports the FT.