Clean tech booster

Government support for clean tech receives a boost thanks to Tesla, Europe and China continue to fight over solar, while Japan and several emerging markets see something of a spending spree.

There was good news in the US last week for proponents of government support for low-carbon technology, as Tesla Motors repaid a federal loan ahead of schedule.

Elon Musk, chief executive officer of the electric vehicle maker, said the company repaid its $US465 million loan nine years early, netting taxpayers around $US17 million in the process. That contrasts with the fates of other loan recipients Fisker Automotive, its battery supplier A123 Systems and solar panel maker Solyndra, which have been held up by Republicans as failed attempts by the Obama administration to pick winners.

The larger amounts outstanding under the $US8 billion advanced vehicle program are not with start-up companies, however. Ford got $US5.9 billion, and has a repayment schedule out to 2022, while Nissan received a $US1.4 billion loan to develop the all-electric Leaf and the batteries that power it.

Across the pond in Europe, leaders had their say on the trade case against the dumping of Chinese solar products. After a meeting with Chinese Premier Li Keqiang in Berlin, Chancellor Angela Merkel said Germany will work hard so that “issues we currently have, for example in the areas of solar energy and telecommunications, will be addressed through as many talks as possible and won’t lead to conflict, leading to mutual tariffs.” Germany, the UK and the Netherlands are among at least 14 member states reported to oppose duties, though France has come out in favour of them.

Preliminary duties are still likely to go ahead in June, with talks then following over the coming months on a negotiated “undertaking” for Chinese companies to avoid the EU enforcing definitive duties. Any settlement is likely to take in China’s own investigations into polysilicon exports, and may involve the US over that as well as its own clean energy trade duties on China last year. For his part, Premier Li said that he “decisively” rejected the imposition of EU duties.

Brussels also kept up the rhetoric. The European Parliament passed a non-legislative resolution last week emphasising that “the unlawful distortion of competition on the market is unacceptable” and calling on the Commission “to bring ongoing proceedings on unfair practices to a conclusion as quickly as possible.” Looking further ahead, the resolution also called for the Commission to propose a mandatory EU-wide renewable energy target for 2030.

That was not touched on by the EU Council of Ministers that met last week to focus on energy and tax issues, except to say they would return to a 2030 framework for climate and energy policies in March 2014, “after the Commission comes forward with more concrete proposals.” The gathering also reaffirmed the goal of completing the internal energy market by 2014, and concluded that “the deployment of renewable energy sources will continue, while ensuring their cost-effectiveness, further market integration and grid stability.”

China’s JA Solar and Germany’s SolarWorld were both among the top gainers in the WilderHill New Energy Global Innovation Index, or NEX, last week. They jumped 43 per cent and 24 per cent respectively. The NEX gained 1.1 per cent overall last week, beating broader market indexes.

We reported a spate of solar news in Japan in last week’s edition. Since then, there was more big news there, as Goldman Sachs announced it would invest as much as 50 billion yen ($A480 million) in renewable energy projects in Japan over the next five years. Hiroko Matsumoto, a Tokyo-based spokeswoman for the firm, said it also plans to take as much as 250 billion yen of loans and project-financing over the same period to move ahead with 300 billion yen of projects. It is unclear what proportion, if any, of this intended investment is for the 250MW PV plant that Goldman Sachs and five other companies reported on last September, which had an estimated cost of $US850m–1.1bn.

There was more going on in emerging markets too last week, with Scandinavian equipment providers prominent. In South Africa, Norwegian developer Scatec Solar agreed $US388 million financing for two PV projects of a total 106.4MW capacity. They are the first to reach financial close out of South Africa’s second bidding round last year.

In Mexico, Infraestructura Energetica Nova, a unit of US utility Sempra Energy, ordered 155MW of wind turbines from Denmark’s Vestas. The latter faced worse news in India, however, as it called in Denmark’s fraud squad to probe deals it says former chief financial officer Henrik Noerremark made, which led the turbine maker to set aside $US24 million to cover possible losses.

Russia approved a new incentive scheme targeting wind, solar and small hydro capacity up to 6GW by 2020. The measures will increase the proportion of renewable energy to 2.5 per cent of power generation by then, from 0.8 per cent now, an energy ministry spokesperson said.

EU carbon

European carbon permits moved little last week. European Union allowances (EUAs) for December 2013 added just 0.6 per cent over the week, closing Friday’s session at €3.56/tonne, compared with €3.54/t at the end of the previous week.

EUAs were trading as high as €3.68/t on the first day of trading last week, although there were relatively low volumes. Only 5.7Mt of December 2013 contracts exchanged hands on the ICE Futures Europe exchange in London on Monday last week – likely due to a public holiday in some European countries. Front-year EUAs dropped to a low of €3.20/t on Thursday. They bounced back to a high of €3.59/t on Friday as trading volumes rose.

UN Certified Emission Reduction credits (CERs) for December 2013 lost 12.8 per cent to finish the week at €0.34/t.

This article was originally published by Bloomberg New Energy Finance.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles