Panasonic targets green energy buy-outs
By Jonathan Soble in Tokyo
Published: July 29 2010 11:34 | Last updated: July 29 2010 11:34

Panasonic has placed an Y820bn ($9.4bn, €7.2bn, £6bn) bet on the future of green energy by offering to buy out minority shareholders in two subsidiaries specialising in lithium-ion batteries, solar cells and other environmental technology.

The Japanese electronics group, which is seeking to reduce its reliance on more conventional products such as televisions and refrigerators, on Thursday said it would seek to acquire all the shares it does not already own in Sanyo and Panasonic Electric Works.

It currently owns just over 50 per cent of both companies.

The move is part of an effort by Panasonic and by other Japanese electronics manufacturers to carve out new market niches as profit margins shrink in older businesses and foreign competitors, such as Samsungof South Korea, grab market share with lower prices and increasingly high-quality products.

Panasonic spent Y400bn last year to buy control of Sanyo from an investment consortium led by Goldman Sachs, which had bailed out then-struggling Sanyo in 2006…….

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Australia’s new Prime Minister Julia Gillard has demonstrated strong support for her domestic renewable energy industry.

Sworn in last month to replace previous leader Kevin Rudd, Gillard said she is “committed to Australia’s largest ever investments in solar and other renewables.”

Gillard has not made specific mention of the controversial carbon cap-and-trade system which former PM Rudd had championed.

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A new report from the Renewable Energy Policy Network for the 21st Century (REN21), a body affiliated with the United Nations and the International Energy Agency (IEA), says renewable energy accounts for over half of all new electricity capacity added in the United States and Europe during 2009.

The REN21 report highlights the shift in manufacturing and deployment of these new energy technologies from developed nations to growing ecnomies like China, Brazil and India.

In 2009, China produced 40% of global solar PV and 30% of all wind turbines; a massive increase from 10% in 2007.

However, despite its advances in implementing green power, China’s carbon dioxide emissions also increased in 2009.  It has overtaken the United States and now claims the title of highest emitting nation in the world.

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Last week, President Obama offered a strong show of support for domestic solar power with the offer of $2 billion in loan guarantees for large scale solar projects in the Western United States.

Abengoa Solar is the recipient of the first offer, $1.45 billion to help finance the construction and start-up of a concentrating solar power (CSP) plant in Arizona.  Once operational, the “Solana” plant would add 250MW of electric capacity to the grid, enough to power 70,000 homes and reduce carbon dioxide emissions by 475,000 tons.

A loan of $400 million was also offered to Abound Solar Manufacturing to for the manufacture of thin-film cadmium telluride solar panels, the first time such manufacturing will be deployed anywhere in the world.  When completed in 2013, the manufacturing plant will be capable of producing enough panels to support up to 840MW of new solar every year.

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Worldwide, global venture capital investment in the green tech sector has climbed to $4.04 billion during the first half of 2010.  This represents a 65% increase from the same period last year, and slightly exceeds the investment record set during the “boom year” of 2008.

Data from The Cleantech Group and Deloitte shows that solar energy garnered about 40% of all investments, attracting about $811 million in funding.

“There’s been a very clear resurgence in solar activity and that is largely responsible for the strong quarter,” notes Richard Youngman, head of global research for the Cleantech Group.

Scott Smith, Deloitte’s U.S. clean tech leader believes this VC investment trend will have a positive impact on renewables and low carbon industries.    “The significant strengthening of corporate and utility investment into the clean tech sector, relative to 2009, is very encouraging, given the key role they will play in enabling broader adaptation of clean technologies at scale,” he said in a statement.

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Thanks to the implementation of an industry-friendly feed-in-tariff in 2007, the Italian solar PV market has taken off at a furious pace.

Data from the Interstate Renewable Energy Council (IREC) shows that Italy installed more photovoltaic systems than the entire United States in 2009.  What’s more, by the end of the year, Italy will have installed over 2,500 MW of solar PV power, more than one and one-half times the U.S. total.

Italy is now the world’s second largest solar PV market after Germany.  Unlike Spain, Italy is not planning to remove its feed-in-tariff anytime soon.  It has set a new target of 3,000MW for the next time period of 2011-2013, but will trim the tariffs 18% by Q3 of 2011.  Italy reached its 2010 target of 1,200MW earlier this year.  Most of these new installations are on rooftops or in distributed applications, and according to the Gestore dei Servizi Energetici, almost 1/4 are relatively small (20kW or less).

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According to Global Solar Energy Outlook, a new report published by Pike Research, solar power is expected to reach grid parity by 2013, when its costs will be equal to that of traditional energy sources like coal and oil.

Pike predicts that global solar demand will grow at a compound annual growth rate of 24% between now and 2013.  A confluence of factors, including a new abundance of polysilicon, government stimuli in response to the global economic crisis and increased cost efficiency of solar panel modules, have come together to change solar from a “supply-constrained” to a “demand-driven” industry.

“Solar prices are plunging quickly, and lower pricing will fuel a surge in demand in 2010 and beyond,” says senior analyst Dave Cavanagh.  Cavanagh predicts to see a “significant shakeout amongst solar suppliers in the next two years” as companies face increased pressure due to pricing trends and oversupply of solar modules.

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It appears that between the Gulf Oil spill, climate change uncertainty, rising energy costs and the availability of future supplies has finally shaken American consumers out of their comfort zone.

Long accustomed to cheap and easy access to energy, American consumers have been notoriously resistant to changing their ways to use less energy.  However, according to a recent study by GE, 79% of U.S. consumers would be willing to make short term changes in order to achieve long-term energy benefits.

A full 88% of those polled would start to use devices like smart meters to help them use energy more efficiently, and of this group, 82% say that smart meters and related devices will be “vital technologies” for the future.

Perhaps the most striking result is the 72% of respondents who agree that America’s energy use and consumption habits, if left unaltered, could stifle future economic growth.  This result, GE says, proves that “consumers are ready to think differently about how they use energy.”

“There are some things that are essential to achieving a desired quality of life,” says Bob Gilligan, VP of Digital Energy for GE Energy Services, “and Americans overwhelmingly agree that investing in our nation’s energy future is one of them.”

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Oil and gas major Total and Spain-based solar company Abengoa Solar have been appointed to construct the largest concentrating solar power (CSP) plant in the world in Masdar, the carbon-zero city and renewable energy initiative of Abu Dhabi.  Abu Dhabi aims to achieve 7% renewable energy generation by 2020.

Called “Shams 1,” this planned CSP plant will extend over an area of 2.5 square km and have a generation capacity of approximately 100MW.  Once completed, it will be the first of its kind in the Middle East region, and the first CSP plant to be registered with the United Nation’s Clean Development Mechanism (CDM).  This registration will make Shams 1 eligible for carbon credits.

“This project, which will be the first utility-scale, commercial solar power project in the UAE, represents the translation into reality of the vision the Abu Dhabi leadership had for renewable energy in the Emirate,” said Dr. Sultan Al-Jaber, CEO of Masdar.  Looking ahead, Abengoa Solar’s director of international development Michael Geyer believes this project is only the beginning.  “The Middle East,” he said,  “is a region that offers both an unlimited solar resource and infinite site locations for implementation of solar plants in its deserts.”

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The largest source of renewable energy generation in the world is hydropower, accounting for 20% of global electricity supply.

According to a recent report from Global Data, total hydropower capacity has increased from 695.8 GW in 2001 to 888.8 GW in 2009 – a CAGR of 3.1%. This dramatic increase resulted mainly from new Chinese installations, many of which came online in 2004.  Favorable government subsidies have also allowed the hydro sector to continue its growth.

Although fossil fuels are still the dominant source of energy production worldwide, over 60 nations now rely on hydropower to satisfy 50% or more of their domestic energy needs.

Global Data predicts installations of small hydro plants will grow to 201GW by 2020, and predicts smaller installations will be an important source of growth for the industry.

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The European Union (EU) Presidency announced the launch of a €6 billion public-private partnership to vastly increase the amount of wind energy used in Europe.

The European Wind Initiative (EWI) is the result of a collaboration between the European wind industry, the EU comission and EU member states.  The EWI aims to supply 20% of all European energy demand with wind energy resources by 2020, 33% by 2030, and finally 50% of total demand by 2050.

The EWI will support research on advanced turbine and component technology to increase efficiencies and reduce costs.  The Initiative aims to speed deployment of both on- and off-shore wind installations, and ease integration of large-scale systems into the grid.

“The European Wind Initiative is a big step forward in our efforts to maintain and strengthen Europe’s global leadership in wind energy technology,” remarked Christian Kjaer, CEO of the European Wind Energy Association (EWEA).

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According to an Ernst & Young global survey of 300 corporate executives, 70% of global firms with revenues of $1 billion or more say they will be increasing spending on climate change initiatives over the next two years.

Energy efficiency investments emerged as a major theme from the survey results.   More than 82% of respondents expected to make energy efficiency investments over the next year, and 92% of those polled said energy costs would be high on the list of priorities over that time period.

Melanie Steiner of Ernst & Young said these results show that despite uncertainty over climate change, “companies are really taking action anyway, because they’re seeing that this is a business issue and an opportunity to generate new revenue.”

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BEIJING, May 27 (UPI) — China and the United States signed eight green energy deals Wednesday in Beijing but financial details were not disclosed, Chinese media reported.

The deals, designed to increase cooperation in the sector, cover areas such as aviation biofuel, distributed energy systems using natural gas as fuel, smart meters and cellulosic ethanol, the China Daily reported. A number of Chinese and U.S. companies would be involved in the eight deals.

The report quoted analysts that the agreements between the world’s two largest energy users would encourage global collaboration in increasing energy efficiency and protecting the environment.

The agreements came at the conclusion of the two-day China-U.S. Strategic and Economic Dialogues in Beijing.

Zhang Guobo, head of the National Energy Administration, also noted bilateral collaboration in renewable energy development, adding: “The United States has advanced technology, and China has a huge market,” the China Daily reported.

U.S. Ambassador to China Jon Huntsman was quoted as saying the two countries will “take every angle” to ensure their cooperation in energy and environment.

Zhang said renewable energy development is important for China to achieve goals of increasing the use of non-fossil energy to 15 percent of primary energy use by 2020, and reducing carbon intensity by 40 percent to 45 percent in 2020 from 2005 levels, China Daily reported.

He said China will continue to focus on the development of hydro, wind, solar, and biomass energy in the renewable sector.

Earlier, U.S. Energy Secretary Steven Chu was quoted as saying improving energy efficiency would both reduce greenhouse gas emissions and boost economic growth.
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With domestic energy demand expected to grow almost 250% by 2028, Saudi Arabia must plan strategically to meet its future needs.  The desert kingdom is looking to renewable energy – specifically solar – to play a bigger role in its domestic energy mix.  Saudi Arabia is aiming generate between 10-20% of its energy from renewables by 2020.

In a recent statement, Saudi Aramco CEO Khalid A. Al-Falih warned “if no efficiency improvements are achieved, and the business is as usual, the oil availability for exports is likely to decline to less than seven million barrels per day by 2028, a fall of three  million barrels per day while the global demand for our oil continues to rise.”

The Kingdom is planning to invest nearly $80 billion to boost its power supply to 60,000MW, with solar energy likely to be the largest new contributor.  By 2020, solar technology could satisfy up to 5GW of Saudi Arabia’s total energy demand.

Saudi Arabia is reportedly in talks with Abu Dhabi’s carbon-free Masdar City initiative regarding a possible future collaboration.

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The United Kingdom’s offshore renewable energy capacity could one day generate as much electricity every year as would one billion barrels of oil, according to a recent report from the Offshore Valuation Group.

The Group projects that utilizing just one third of the available wind and tidal resources off the UK coast could eventually transform the nation from a net importer to a net exporter of electricity by 2050.  At the same time, deploying these resources would result in a savings of 1.1 billion tons of carbon dioxide emissions and create infrastructure with a positive net present value of £35 billion.

“We have long been saying that the North Sea will become the Saudi Arabia of wind energy,” says Peter Madigan, head of offshore renewables at industry advocacy body RenewableUK.

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Over the next two decades, the world may be faced with a global infrastructure debt of as much as $2 trillion a year, according to the “Positive Infrastructure Report,” a new publication from the World Economic Forum (WEF).

Brazil, China, India and the United States are the largest infrastructure markets in the world, and as such, face the most severe challenges in the years ahead.  The WEF report says that the public sector has a vital role to play in successfully meeting these challenges, and advocates for a strategic deployment of public funding through centralized global stimuli packages.

Developing nations, on the other hand, face a dearth of sufficient capacity.  In order to satisfy increasing demand, the WEF suggests incentive measures such as optimizing existing structures via pricing schemes and advanced technologies.

Overall, the WEF report says the most successful infrastructure projects around the world come via public-private partnerships (PPPs).

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At first glance, Saudi Arabia may seem an unlikely supporter of renewable energy, considering the vast oil resources under its control.  On the contrary, Saudi Arabia is looking to take advantage of its other prolific resource – sunlight – with new solar power projects designed to keep the country competitive as renewables increasingly play a role in the overall energy mix.

Mohammed Y. Al-Qahtani, executive director of petroleum engineering and development at Aramco believes “renewables will have an important place in the total energy equation.”   Saudi Arabia is looking to use its substantial solar resources as a substitute for oil to generate power domestically as well as to power desalination plants.  Although solar is currently more a more expensive means of power generation than oil or gas, Al-Qahtani expects this will shift over time.

The Kingdom recently invested in one of the world’s largest solar-heated complexes at a school in the northwestern part of the country, and is considering participating in the Desertec Initiative which would transmit electricity from North Africa and Middle Eastern solar power plants to Europe.

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The United States Department of Energy (DOE) is instituting its first-ever strategic plan to deal with “Rare earth metals” – the special group of elements that are essential components of clean energy technologies like electric vehicle batteries, compact flourescent light bulbs and solar panels.

As nations around the world increase development and deployment of clean energy, there is a growing anxiety about China’s clear dominance of these essential supplies.  China currently supplies nearly 95% of global demand  for rare earth metals, and the government is attempting to control all processing of rare earth metals.  Over the past seven years,  China has reduced global exports by 40% and some estimates expect China will begin halting exports of these rare earths within the next two years.

“It goes without saying that diversified sources of supply are important for any strategic material,” said David Sandalow, Assistant Secretary of Energy for Policy & International Affairs.  ”So too are substitutes and strategies for re-use and recycling.  If rare earth metals are going to play an increasing role in our economy, we need to pursue those strategies.”  The DOE is soliciting information from industry, research labs and other related organizations to gain a more complete understanding of cost and supply issues regarding rare earth metals.

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