In today’s edition, Alstom’s saga is not over yet, but a deal – for its energy arm – seems almost done between the French engineering giant and GE. However, Alstom vowed to examine rival bid from Germany’s Siemens, too. Also in the news today, more info on the concrete impact of sanctions imposed on Russia. And finally, analyses regarding Energy Future Holdings Corp.’s future.
Quote of the day
“We have a good relationship with GE. We are ready to discuss alliances, not an absorption. We prefer an equal alliance.”
French Economy Minister Arnaud Montebourg, in the Reuters’ story Alstom studies GE offer, leaves door ajar for Siemens
Alstom studies GE offer, leaves door ajar for Siemens
James Regan and Benjamin Mallet, Reuters
Cash-strapped French engineering group Alstom said on Wednesday it would study a $16.9 billion offer from General Electric for its energy arm but left the door open for a rival bid from Germany’s Siemens.
***LB: Also in this story “GE remained ahead in the race to secure assets which would boost its position in producing steam turbines for power stations and technology for electricity grids.”
ANALYSIS-France caught between nuclear cliff and investment wall
Michel Rose, Reuters
France must decide in the next few years whether it wants to continue its nuclear-driven energy policy at a cost of up to 300 billion euros ($415 billion) or if it wants to embark on an equally costly route towards using other fuels.
***LB: Also in this story “That may leave France with no other choice than hastily building coal or gas-fired plants to back up the expansion of renewable power, supplies of which can fluctuate depending on weather conditions and time of day.”
Will sanctions bite?
Mike Peacock , Reuters
Financial markets may view the latest sanctions against Russia as feeble, but the reaction from Moscow – Vladimir Putin threatened to reconsider Western participation in energy deals and his foreign minister, Sergei Lavrov, said they were the work of weak politicians – suggests otherwise.
Some U.S. companies starting to feel pain from Ukraine crisis
Lewis Krauskopf, Reuters
Turmoil in Ukraine and a series of Western sanctions on Russia are starting to hurt some U.S. corporations doing business in the region, with the latest round of U.S. penalties threatening to complicate matters further.
***LB: Also in this story “McDonald’s Corp (MCD.N) , which imports about half of its food used in its Russian restaurants, said the weaker ruble hurt restaurant margins in Russia by 2 percentage points, dragging down the company’s overall margins in Europe.”
Russian firms turn to Asia for finance as Western funds demur
Sujata Rao and Michelle Chen, Reuters
Russian companies shut out of Western markets as a result of the Ukraine crisis are scouting the possibility of raising cash via Chinese or Singapore bonds instead, even if a large scale funding switch to Asia is likely to be a tall order.
***LB: Also in this story “Asian investors, eyeing the risks associated with Western sanctions, could prove a hard sell.”
Ukraine Hunts for Gas to Prepare for Winter Without Russia Fuel
Ladka Bauerova and Daryna Krasnolutska, Bloomberg
Spring has barely started in Ukraine and the nation is already thinking about winter’s chill.
Gazprom aims to mitigate effect of sanctions as profits dip
Jack Farchy, The Financial Times
Gazprom said it was taking action to mitigate the impact of possible further western sanctions as it reported a 7 per cent drop in net profit last year.
***LB: Also in this story “On Tuesday, Gazprom’s chief executive Alexei Miller met Zhou Jiping, head of China’s CNPC, for the latest in long-running negotiations over a long-term gas supply contract from Russia to China.”
Putin Threat to Retaliate for Sanctions Carries Risks
Indira A.R. Lakshmanan and Joe Carroll, Bloomberg
President Vladimir Putin’s threats to retaliate for further sanctions on Russia set the stage for escalating economic warfare that may have painful effects for U.S. and European companies.
***LB: also in this story “Other major companies may suffer from the backlash, including Royal Dutch Shell Plc (RDSA), which plans to expand its Sakhalin-2 oil and gas project in Russia’s Far East, and PepsiCo Inc. (PEP), which earned 7.4 percent of its 2012 revenue from Russian business, according to data compiled by Bloomberg.”
E.ON CEO says working well with Russian partners
Germany’s largest utility E.ON sought to reassure shareholders on Wednesday about its Russian investments as it kept its profit outlook for this year unchanged.
Biggest Buyout Gone Bust in Energy Future Dims Megadeals
David Carey and Sabrina Willmer, Bloomberg
The failure of Energy Future Holdings Corp., known as TXU Corp. when KKR & Co., TPG Capital and Goldman Sachs Capital Partners acquired it for $48 billion in 2007, and the stumbles of other huge deals of the past decade have reshaped how major buyout firms go about their trade.
Energy Future Junior Creditors Test Bid for Fast Bankruptcy Deal
Steven Church, Tiffany Kary and Linda Sandler, Bloomberg
Energy Future Holdings Corp., the Texas power company that plans to leave bankruptcy in less than a year, can’t reduce its $50 billion in debt without fighting junior creditors who face losing their investment.
Shale Drillers Feast on Junk Debt to Say on Treadmill
Asjylyn Loder, Bloomberg
Rice Energy Inc. (RICE), a natural gas producer with risky credit, raised $900 million in three days this month, $150 million more than it originally sought.
***LB: Also in this story “While the high-yield debt market has doubled in size since the end of 2004, the amount issued by exploration and production companies has grown nine-fold, according to Barclays Plc.”
2014 MIDWEST SOLAR EXPO
Minnesota’s Marquee Solar Event
The Midwest Solar Expo is bringing together solar leaders from across the Midwest to advance dialogue on key issues, provide insight on the latest industry trends and best practices, and serve as a nexus between the solar industry and the public.
May 16, 2014
China says could add big-polluting regions to carbon market
China is developing plans to expand its pilot carbon trading schemes into more of its key industrial regions, a top climate official said, as the country continues its drive to curb emissions.
US Supreme Court backs Obama’s air pollution rules
James Murray, BusinessGreen
The Obama administration’s green agenda received a major boost yesterday, after the Supreme Court backed flagship regulations designed to tackle air pollution across the US.
***LB: also in this story “The regulations, which are expected to result in tighter air pollution rules for around 1,000 power plants and appear designed to complement imminent carbon emission rules, were blocked last year by a ruling from the US Court of Appeals for the D.C. Circuit.”
Washington state governor unveils carbon reduction plan
Rory Carroll, Reuters
Washington Governor Jay Inslee outlined policies on Tuesday to cut greenhouse gas emissions from the state, including a carbon cap-and-trade program, although he will need approval from the state legislature before implementing the measures.
Report: Green policy uncertainty could derail UK carbon targets
Jessica Shankleman, BusinessGreen
Investor uncertainty over the future of green government policy is already undermining the UK’s ambitions to slash carbon emissions and drive investment in clean technologies, new research will reveal today.
Exxon, Total and Shell are finally talking about climate change
Paul Dickinson, theguardian.com
Some of the most powerful forces of the modern world have this month entered into an engagement that puts international security at stake.
***LB: Also in this story “A campaign for divestment of fossil fuel companies has been sweeping the globe.”
Natural Gas / Coal
Supporters optimistic about natural gas export bill
Timothy Cama, The Hill
Representatives who support a measure to expedite applications to export liquefied natural gas (LNG) to most countries said Tuesday that they are confident the bill can pass the House with strong, bipartisan support.
Drillers Hooked on Oil Bolster Goldman $6 Gas Outlook: Energy
Christine Buurma, Bloomberg News
U.S. energy producers are sticking with oil over natural gas, boosting Goldman Sachs Group Inc.’s view that gas at a six-year high may still have room to rally.
Malaysia’s Petronas sells stake in Canada gas project to Sinopec
A plan by Malaysian state-owned oil firm Petronas to build an $11 billion liquefied natural gas (LNG) export terminal on Canada’s Pacific Coast gained momentum on Tuesday with China’s Sinopec Group and a Chinese state utility joining the project.
Turkey presses for delay-free Algerian LNG
Orhan Coskun, Reuters
Turkey hopes to renew its liquefied natural gas (LNG) contracts with Algeria but it must first ensure that deliveries are timely, Energy Minister Taner Yildiz told reporters.
(Opinion) The Right Way to Develop Shale Gas
Michael R. Bloomberg and Fred Krupp, The New York Times
Listening to the polarized energy debate in the United States, you might think natural gas was an economic and geopolitical cure-all — or an environmental curse.
Nuclear power producer Exelon to buy Pepco for $6.83 bln
Exelon Corp, the largest U.S. nuclear power producer, said it would buy Pepco Holdings Inc for $6.83 billion to create the biggest electric and gas utility in the U.S. Mid-Atlantic region.
China’s drop in new thermal power pinned on economy, war on pollution
China added nearly 40 percent less coal- and gas-fired power capacity in the first quarter than it did a year ago mainly due to stronger pollution controls and slower economic growth, a senior government advisor said on Wednesday.
Greek Public Power Markets Bonds in First Sale Since 2000
Abigail Moses, Bloomberg
Public Power Corp SA (PPC), Greece’s largest electricity company, is returning to the bond market for the first time since 2000 as recovery takes hold in the nation that set off the euro region’s debt crisis.
UK solar market to lead Europe in 2014
Jessica Shankleman, BusinessGreen
A huge expansion of solar farms across Britain this year could propel the UK into pole position in the European market, new figures have revealed.
UK solar farm subsidies to be cut
Adam Vaughan, theguardian.com
Subsidies paid to solar farms in the UK will come under review by ministers within weeks, Whitehall sources have told the Guardian.
Clegg announces £500m boost for electric vehicle market
James Murray, BusinessGreen
(UK’s) Deputy Prime Minister Nick Clegg has today officially launched the next phase of the government’s ultra-low emissions vehicles (ULEV) strategy, promising that £500m will be made available to support the fledgling sector between 2015 and 2020.
Almost half of Americans live with unhealthy levels of air pollution
Suzanne Goldenberg, theguardian.com
Nearly half of all Americans live in areas with unhealthy levels of air pollution, according to an American Lung Association (ALA) report released Wednesday.
UN official: The world is ready for a Paris climate deal
Jessica Shankleman, BusinessGreen
For someone who has spent more than two decades swimming in the at times murky waters of international climate change negotiations, Richard Kinley is surprisingly upbeat.
(Opinion) Valuing natural capital: What next and why?
Earth Day, 2014: I’m on my way to Copenhagen, for the annual GLASA event (the acronym stands for “Global Leadership Award in Sustainable Apparel”). This year, it is an apparels industry symposium on valuing and accounting for natural capital.
***LB: Also in this story “I believe stakeholder reporting of this kind will redefine corporate success.”