'Climate risk is investment risk': BlackRock exiting thermal coal investments
BlackRock Inc. Chairman and CEO Larry Fink announced Jan. 14 that by mid-2020, the investment giant would exit its investments in companies that depend on thermal coal for more than a quarter of their revenues. "With the acceleration of the global energy transition, we do not believe that the long-term economic or investment rationale justifies continued investment in this sector," Fink wrote in his annual letter to CEOs.
EIA increases 2020 oil price outlook more than 7% on Middle East tensions
The U.S. Energy Information Administration increased its 2020 crude oil price outlook by more than 7%, citing intensifying geopolitical risks, OPEC production cuts and favorable macroeconomic trends. The agency said it assumed "OPEC will limit production through all of 2020 and 2021 to maintain relatively balanced global oil markets."
Subsea drilling could help buoy struggling oilfield services sector in 2020
The total oilfield services market contracted 2% in 2019 due to cuts made in U.S. shale investment, Rystad Energy said in a December 2019 report. However, the research and consulting firm noted that the subsea sector could provide a counterbalance for oilfield services companies beginning in 2020. A ramp-up in deepwater drilling activity portends an increasing workload for offshore drillers and equipment providers as Exxon Mobil Corp., Tullow Oil PLC, Apache Corp. and Total SA focus their offshore efforts in Guyana, Suriname and the Gulf of Mexico.
Infrastructure buildout may drive oil and gas sector's greenhouse gas growth
The buildout of oil and gas infrastructure along the U.S. Gulf Coast may add 541 million tons of carbon dioxide equivalent greenhouse gas emissions annually by 2030, with more than two-thirds of that growth coming downstream of oil and gas producers, a Jan. 14 report from the University of Texas at Austin concluded. The estimate is equivalent to more than 8% of total U.S. greenhouse gas emissions in 2017 and is "roughly equivalent to the emissions of 131 coal-fired power plants," according to the report's authors.
Other energy headlines
* The U.S. Department of Energy published energy conservation standards for portable air conditioners, commercial packaged boilers and uninterruptible power supplies such as battery chargers. The standards had been delayed under the Trump administration for more than two years. The standards take effect March 10, and the deadline for compliance is Jan. 10, 2022, for interruptible power supplies, Jan. 10, 2023, for commercial packaged boilers and Jan. 10, 2025, for portable air conditioners.
* Exelon Corp. is pushing back on ISO New England's proposal to sunset one-year-early tariff provisions that enable the grid operator to retain resources for fuel security purposes, charging that the move would exacerbate uncertainty while a long-term market solution to the region's fuel security needs remains under development. The utility said in a protest filed with the Federal Energy Regulatory Commission that "there is simply no reason to shorten the life of the fuel security provisions now when doing so would unnecessarily limit ISO-NE's options for addressing fuel-security needs" before market reforms take place.
* In its first podcast of 2020, S&P Global Market Intelligence's ESG Insider talked to Ceres CEO Mindy Lubber and other key stakeholders across the ESG world about the issues they are focused on in the new decade. The sluggish response to rapidly worsening climate risks was a recurring theme.
* The expansion of onshore wind in the U.K. declined in 2019, with slightly fewer new turbines installed compared to a year earlier, trade group RenewableUK said Jan. 14, as the pipeline of projects with government subsidies comes to an end. In total, 629 MW of new onshore wind capacity was installed in 2019, compared to 651 MW in 2018, according to data from RenewableUK, which captures projects of at least 100 kW.
Shale oil production in the U.S. topped 9.1 million barrels per day in November 2019 and is expected to grow further, according to the U.S. Energy Information Administration.
Research and data
* RRA Regulatory Focus: WEPCO's latest rate case decision denies electric vehicle incentive request
* RRA Regulatory Focus: Industrial rate design garnered considerable attention in NIPSCO's Ind. case
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Citing 'all-time low' prices, Calif. aggregators eye more battery-backed solar
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