Daily Archives: September 10, 2009

Kate Mackenzie

So, Google is working away on its own solar thermal technology, using cheaper mirror material, that it hopes to demonstrate internally within a few months.

But the company is also investing in clean energy technologies elsewhere – though it would like to do more, according to Bill Weihl, who oversees clean energy projects in the company’s research department.

It’s not the clean-tech ‘valley of death‘ (getting proven technologies up and running at scale) that Weihl is complaining about – it’s the early stages, which he says need more investment from the public sector – in the order of $20bn to $30bn over 10 years, in fact.

“There isn’t enough investment going into the early stages of investment pipeline before the venture funds come into the play.”

However he characterised the situation as “a little bit” discouraging – but not seriously discouraging.

Interestingly, Google.org – the philanthropic arm of the company – invests in the big US solar companies eSolar and BrightSolar, and its total clean energy investments add up to about $43.5m so far. Founders Larry Page and Sergey Brin have invested in another company, Nanosolar.

But the solar development, under Google’s research department, is being carried out separately from those solar companies.

Related links:

Google plans new mirror for cheaper solar (Reuters, 10/09/09)
Google.org grants and investments (Google)
PowerMeter: Everyone loves a good Google theory (FT Energy Source, 11/02/09)

By Izabella Kaminska

Hat tip to Morgan Downey, author of Oil 101, for the following chart reflecting the still ongoing over-supply issues facing energy and tanker markets.

Oil in floating storage worldwide - Morgan Downey

Related link:
– FT Alphaville

Kate Mackenzie

On FT Energy Source:

Opec tackles the environment… sort of

Opec keeps output steady, but hints emerge between the lines

Saudi Arabia’s oil minister takes a victory lap

Oil field fever in the Santos basin

Markets: Crude gains after IEA revision

Is predicting oil demand a mug’s game in 2009?

Yes to French carbon tax – and a higher one than expected

Further reading:

Are the US and China going to get together on clean technology? (Guardian)

Another $70bn worth of LNG from Australia’s Gorgon project is sold; this time by Chevron (ABC)

Inside India’s intransigence on climate change (Time)

Jeff Sachs on how the US must prioritise its energy strategy (Scientific American)

Nanosolar declares $4bn worth of contracts; a history of the company’s bold claims (Wired, BNet)

Pemex’s new chief takes the reins: What next? (Houston Chronicle)

Google plans to develop ‘mirror-based’ solar technology (Reuters)

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Kate Mackenzie

French president Nicolas Sarkozy confirmed today that a carbon tax on oil, coal and gas will be introduced, at €17 per tonne.

The figure is higher than the €14 suggested by Francois Fillon late last month – but much lower than the €32 recommended by a government commission.

Previous estimates of the €14 tax translated as 3.3c per litre on petrol, so presumably €17 would work out at somewhere in the region of 3.5c – 3.6c.

Kate Mackenzie

The IEA has revised upward its oil demand forecasts for 2009 and 2010, and by a decent amount this time – but the agency has kept a very cautious tone about the general outlook.

Worldwide demand, the IEA says, will now average 84.4m barrels per day in 2009, and 85.7m bpd in 2010. Both figures are 500,000 barrels higher than the estimates published last month.

Much of this change is due to North America and China – but the picture in both these areas, the agency says, is rather murky.

Crude oil prices found support from revised demand forecasts from the International Energy Agency. The energy watchdog of the west said global oil consumption would shrink less-than-previously expected this year because of strong consumption in China and the US.

In its latest monthly oil market report, the IEA forecast a drop of 1.9m b/d in global oil demand this year compared with the 2.3m b/d decline which it previously anticipated.

Opec’s decision to keep its production quota unchanged had been widely anticipated by the market and had little impact.

Carola Hoyos

At their meeting in Vienna on Wednesday, Opec members did not only discuss oil production levels and prices; they also touched on their collective position ahead of the UN climate change summit in Copenhagen at the end of this year.

As José Maria Botelho de Vasconcelos, Angola’s oil minister, said at the start of the meeting:

Oil producers must ensure that their interests are properly represented in the post-Kyoto agreement, as this is drawn up. There is much at stake here, for both present and future generations, in our member countries.

And at the end of the session, Abdalla Salem El Badri, Opec’s secretary-general, said Kyoto promises needed to be kept and that developing countries should not have to carry the burden of cleaning up the environment. Nor should oil producers be penalised for what they do, he said.

The group will have to come up with a more concrete position soon. Watch this space…

Related links:

Opec’s interests in emissions reduction (FT Energy Source, 20/04/09)

James Fontanella-Khan

Opec holds output unchanged
Cartel warned that the group would act if oil prices fell (FT)

EU wants China to expand its energy role
EU seeks easier ways companies to participate in public procurements (WSJ)

Brazil oil find could hold 2bn barrels
Prospects of becoming a leading oil producer increased (FT)

Carola Hoyos

The Opec oil cartel’s decision to keep its output levels unchanged may not have come as much of a surprise. But those reading the group’s communique closely will find a few points that leave plenty of room for debate.

The group clearly stressed the possible downside of its decision, voicing “great concern,” calling the market “over supplied” and describing the recovery as “extremely fragile.”  The clincher, though, is that Opec said it would “leave current production levels unchanged for the time being.”

There are two things to note here. The obvious one is Opec is saying it stands ready to act if prices go south, as some analysts believe will happen. Less obvious is that Opec agreed to keep current production levels unchanged, rather than stating it would leave quotas where they were.

There may be two reasons for this:

1. Despite its cautious statement, the group feels that even with just 68 per cent compliance all is fine.

2. Opec wants to avoid the thorny issue of pushing others to comply, shoving the quotas under the carpet, just as Iran (5 per cent compliance) and Angola (0 per cent compliance) want.

My bet is on the latter. If oil traders agree, prices are likely to slip on Thursday in response.

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