(qlmbusinessnews.com Wed, 20th Sept, 2023) London, UK —
Potential Delay in Petrol Ban Could Hinder Electric Car Adoption, Warns Industry Chief.
The head of the UK's motoring industry group has cautioned that postponing the ban on the sale of new petrol and diesel cars could deter drivers from transitioning to electric vehicles. Government ministers are reportedly contemplating shifting the planned ban from 2030 to 2035. Mike Hawes, CEO of the Society of Motor Manufacturers and Traders (SMMT), expressed concern that such a delay would send consumers an “incredibly confusing” message.
In 2020, the government set the policy to prohibit the sale of new pure petrol and diesel vehicles by 2030, as part of the broader net-zero plan. However, several sources have suggested that Prime Minister Rishi Sunak is considering scaling back the proposal, along with other green commitments, as a cost-saving measure.
Ford, a major UK car brand, and Stellantis, the parent company of Vauxhall, Peugeot, Citroen, and Fiat, have voiced their commitment to achieving 100% zero-emission new car and van sales by 2030, regardless of a potential ban delay. However, they stress the need for government clarity on crucial legislation, particularly environmental issues.
Economist Anna Valero, a member of Chancellor Jeremy Hunt's advisory committee, argued that a delay would harm the UK and disrupt long-term investment decisions for a stronger, more sustainable economy.
While most consumers won't be immediately affected by the ban, the SMMT's Mike Hawes expressed concerns about its impact on car manufacturers and potential delays in consumers' electric car purchases. He stressed the importance of transitioning to sustainable transport to achieve net-zero emissions.
Edmund King, president of the AA motoring group, called the 2030 goal “ambitious but achievable” and emphasized the need for more certainty for the car industry and drivers to plan for the future.
The SMMT highlighted the UK car industry's success in securing investment for zero-emission vehicle development in recent months, including BMW's investment in its Mini factory and Tata's battery plant plans.
BMW stated that a delay to 2035 wouldn't alter its electric car plans, debunking reports suggesting it was a condition for its recent investment. Jaguar Land Rover affirmed that its net-zero plans remain on track and called for legislative certainty regarding the end of petrol and diesel car sales.
Mike Hawes also expressed confidence in the introduction of the zero-emission vehicles mandate, requiring 22% of cars sold by each manufacturer to be zero-emission from 2024.
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(qlmbusinessnews.com Tues, 19th Sept, 2023) London, UK —
UK drivers have been cautioned about an impending surge in fuel expenses as global oil prices hit their highest point in 10 months. On Tuesday, Brent crude, a key price benchmark, surpassed $95 a barrel amid forecasts of constrained supplies. This increase comes in the wake of the International Energy Agency (IEA) expressing concerns that a production cut by Saudi Arabia and Russia could lead to a “significant supply shortfall” by year-end.
Motoring group RAC has alerted drivers to brace themselves for escalating pump costs. Recent data reveals that UK motorists are currently paying an average of £1.55 per litre for petrol and £1.59 per litre for diesel. Since August, average petrol prices have surged by 10p per litre, while diesel prices have climbed by 13p.
Following Russia's invasion of Ukraine in February 2022, oil prices soared, exceeding $120 per barrel in June last year. Prices subsequently receded to just above $70 per barrel in May 2023 but have been steadily increasing since then as producers have curtailed output to bolster the market. In August, Saudi Arabia and Russia, both major oil-producing nations and members of the OPEC+ group, resolved to reduce production.
Concurrently, the US Energy Information Administration revealed on Monday that US oil production from its top shale-producing regions was set to decline for the third consecutive month in October, reaching its lowest point since May.
Saudi Arabia, being a leading oil exporter, is inclined to maintain elevated oil prices to ensure a consistent income stream while it seeks to diversify its economy. However, Western nations have accused OPEC, whose members convene regularly to determine production levels, of price manipulation.
As crude oil constitutes the primary component of fuel, motoring groups have cautioned that petrol and diesel prices could continue to rise. The AA emphasised that increasing prices coincide with reduced fuel efficiency, typically observed due to darker evenings.
Luke Bosdet, the AA's pump prices spokesman, noted, “Drivers have endured a 10p-per-litre increase in petrol costs since the start of August. The only things working in their favour have been the persistence of daylight during rush hour and mild weather, which leads to lower fuel consumption. Those drivers who are beginning to feel happier are those with electric cars.”
RAC's fuel spokesman, Simon Williams, observed that with oil nearing the $100-per-barrel mark, drivers face challenging times at the pumps. He suggested that an increase to three figures would likely raise the average price by another 2p per litre. Nevertheless, Williams warned that “if retailers are aiming to achieve higher profit margins per litre, this could drive the average petrol price closer to 160p.”
Analysts have raised concerns that surging global oil prices could impact inflation rates in various countries. Inflation experienced a sharp rise in 2022 and has only recently begun to decline. Sophie Lund-Yates, Lead Equity Analyst at investment firm Hargreaves Lansdown, commented on the symbolism of oil nearing the $100-per-barrel mark, which is “now being considered once more.” She added that fuel accounts for a substantial portion of overall inflation, making this a challenging development.
The Office for National Statistics (ONS) is due to release the latest UK inflation figure on Wednesday. Inflation has receded in recent months but remains elevated at 6.8%. Households have been grappling with increased fuel and energy bills, while businesses have raised prices to cope with mounting expenses. The pound's recent depreciation may have exacerbated fuel costs, as oil prices are also influenced by the exchange rate between the pound and the dollar, given that Brent crude is traded in dollars.
Saudi Arabia's Energy Minister, Prince Abdulaziz bin Salman, defended OPEC+'s supply restrictions, asserting that energy markets require light-touch regulation to curb volatility.
Is the High Fuel Costs affecting you or your family? If so, please comment below this video.
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(qlmbusinessnews.com Tue, 5th Sep, 2023) London, UK —
In a blow to motorists, August witnessed one of the most significant monthly spikes in fuel prices in more than twenty years, according to recent data.
The RAC revealed that the average cost of petrol surged by 7 pence per litre in August, making it the fifth most substantial monthly increase in the past 23 years. Diesel prices experienced a hike of 8 pence per litre, ranking as the sixth largest increase within the same timeframe.
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These escalating pump prices can be attributed to the rising cost of oil, which has surged by nearly $12 per barrel since the start of July, reaching nearly $87 per barrel. This surge has been propelled by the Opec+ group reducing its oil supply, thereby driving up the wholesale cost of fuel – the price paid by retailers. Consequently, these higher costs have been transferred to drivers at fuel stations.
Earlier this week, data from the Confused.com fuel index, which categorises regions by postcode, highlighted the areas offering more affordable petrol. These regions include Lancashire, South Wales, and Northern Ireland. Strikingly, the Belfast postcode, which encompasses all of Northern Ireland, currently boasts the cheapest petrol in the country, with an average price of 145.1 pence per litre. Petrol prices in this region are significantly lower than those in any part of mainland Great Britain, with the Torquay postcode securing second place at 146.7 pence per litre.
The top five regions with the lowest petrol prices in the UK are rounded out by Sunderland (146.8p), Bradford (147.0p), and Kilmarnock (147.2p) postcodes.
Conversely, the most expensive areas for petrol in the country are predominantly located in Scottish islands and certain parts of London.
RAC fuel spokesman Simon Williams remarked, “August was a significant jolt for drivers as they had become accustomed to considerably lower prices compared to the record highs of last summer. Witnessing an increase of 6-7 pence per litre at the pump within just a few weeks, adding £4 or more to the cost of a tank, is frustrating, particularly for those who cover extensive mileage or operate older, less fuel-efficient vehicles.”
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“While this price hike is undoubtedly unwelcome for drivers, it could have been even more severe if major retailers had not adjusted their inflated profit margins from earlier in the year to align with the rising wholesale fuel expenses.”
Williams added, “All we can do is hope that many major retailers maintaining fairer fuel pricing at the forecourt, even as wholesale costs decrease, remains the trend. Only time will reveal the outcome.”
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(qlmbusinessnews.com Fri, 18th Aug, 2023) London, UK —
The anticipated energy price cap announcement by Ofgem next week is projected to bring down the average annual gas and electricity bill to approximately £1,823 starting from October, according to predictions by leading forecaster Cornwall Insight.
The forthcoming price cap adjustment would mark a decrease from the current July to September period, which stood at an average of £2,074 annually. However, consumer advocacy groups have voiced concerns that the cost of energy continues to remain “dangerously high.”
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Analysts expect that bills will experience another increase, rising to an average of £1,979 annually from January. This anticipated surge in costs is attributed to the recent spike in global gas market prices, ignited by planned strikes at significant gas projects in Australia.
Craig Lowrey, a principal consultant at Cornwall Insight, noted that despite the marginal reduction in bills starting from October, energy prices are projected to remain significantly higher than pre-crisis levels. This underscores the “limitations of the price cap as a tool for supporting households with their energy bills.”
The energy price cap was initially introduced in January 2019. However, the global energy crisis spurred by Russia's invasion of Ukraine led to a swift escalation in the cap's value. This escalation prompted the government to introduce its own energy price guarantee. The sharp increase has raised concerns about affordability for numerous households facing fuel poverty, prompting calls for a more affordable “social tariff” aimed at assisting the most vulnerable individuals.
Craig Lowrey emphasized the importance of exploring alternative solutions, such as social tariffs, to ensure the stability and affordability of energy costs for consumers.
Ofgem's chief executive, Jonathan Brearley, recently indicated that a reevaluation of the “very broad and crude” price control system was needed in the midst of the ongoing energy crisis. The price cap, designed to ensure fair energy bills based on suppliers' costs, has contributed to pushing millions into fuel poverty due to the record energy price rates.
The anticipated price cap announcement by Ofgem is anticipated to reflect the modest decline in unit prices for gas and electricity, driven by a drop in global gas market prices from their record highs in the previous year. The calculation of the average energy bill is also being adjusted, assuming reduced electricity usage by 7% and decreased gas consumption by 4%. Without this adjustment, the October price cap would be nearly £100 higher, reaching £1,925, according to Cornwall Insight.
Simon Francis from the End Fuel Poverty Coalition expressed concerns about the persistently high energy bills and highlighted the challenging winter ahead for many households.
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It is important to note that the energy price cap only establishes the maximum charge per energy unit, based on a typical home's annual consumption. The actual dual-fuel bill for a household will depend on their individual gas and electricity usage.
Cornwall Insight's forecasts suggest that under the new price cap, the unit price for electricity will decrease from 30p per kilowatt hour to 26.96p/kWh, while the unit price for gas will drop from 8p/kWh to 6.93p/kWh.
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(qlmbusinessnews.com via theguardian.com – – Thur, 13th July 2023) London, Uk – –
Energy secretary indicates cooling of government aspirations as concerns grow over costs, safety and efficiency
Controversial UK government aspirations to replace gas boilers in some homes with a hydrogen-based alternative are likely to be scrapped, Grant Shapps, the energy minister, has indicated.
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Shapps said he believed hydrogen would form part of Britain’s overall energy mix but predicted it was “less likely” that the gas would be routinely piped into people’s homes, as concerns grow about cost, safety and perpetuating a reliance on fossil fuels.
Trials have been underway as part of a government move to phase out natural gas boilers by 2035 amid a broader effort to decarbonise domestic heating, which accounts for about 17% of the UK’s greenhouse gas emissions.
But the plans have in some cases been described as unsafe and have met with opposition in areas that have been earmarked for pilot schemes.
Shapps said: “There was a time when people thought … you will have something that just looks like a gas boiler and we will feed hydrogen into it.”
He added: “It’s not that we won’t do trials. We will. But I think hydrogen will be used storing energy. You won’t have to switch off windfarms when you don’t need the power because you can turn it into hydrogen and use it later.”
Despite being more combustible and leakier than natural gas, energy firms have insisted that hydrogen can be made safe and have engaged in concerted lobbying of both the government and Labour to convince them of its merits.
But the assurances have failed to convince people asked to take part in large-scale trials of the technology.
Whitby, near Ellesmere Port on Merseyside, was to host the first village-wide trial of hydrogen home heating but the government ditched the plan this month in the face of local opposition.
Shapps said: “It is fundamentally unpopular in that area and I don’t believe in telling people we will be coming in to rip up out your boiler to replace it with this other thing that you don’t want, when they are other areas of the country that actually do want to go ahead with a trial.”
Hydrogen is derived either from splitting fossil fuel gas at extreme temperatures (known as blue hydrogen) or by splitting water using electricity from renewables, with minimal emissions – known as green hydrogen.
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Critics argue that creating green hydrogen for home heating is six times less energy efficient than using heat pumps powered by electricity, and say that switching from gas boilers to heat pumps could save money as well as cut emissions.
Shapps also cited logistical concerns, such as the need to replace piping and the length of time it would take produce large volumes of low-emission green hydrogen.
Energy analysts have also warned that hydrogen could be up to 70% more expensive than gas for homeowners who make the switch.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 30th June 2023) London, Uk – –
Energy bills are likely to stay high for the foreseeable future, according to the boss of the company that owns British Gas.
Centrica chief executive Chris O'Shea said while he believes the worst of the energy crisis is over, risks remain.
A new price cap comes into effect this weekend which will see households with typical energy usage pay £2,074.
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Mr O'Shea said prices have fallen from the rise caused by the Russian war, but are higher than the long-term average.
“I think the first act of the crisis is over,” he said. “I think what we've got to remember is the energy prices had more than doubled before Russia invaded Ukraine.
“Now, prices are back down to pre-invasion levels but they're still two and a half times the long run average.”
Gas and electricity bills will fall below the £2,500 level that was subsidised by the government under its Energy Price Guarantee scheme.
However, under the new price cap, which is set by the regulator Ofgem, households bills will remain £800 more expensive than two years ago.
Meanwhile, Cornwall Insight, a consultancy firm, estimates that changes in the price cap – which limits what companies can charge per unit of gas and electricity – will take energy bills for a typical consumer to £1,871 per year from October.
That is then forecast to rise to £1,900 from January.
Mr O'Shea was speaking to the BBC as Centrica announced it was doubling the amount of gas stored in its Rough storage facility off the coast of Yorkshire ahead of this winter.
Despite the extra storage, he said there was a danger that the UK risked being complacent about the resilience of the country's energy supplies which were still vulnerable to external shocks.
“I think that there's a danger that we get complacent because last winter was okay and because prices are quite stable now,” he said.
“But when we had trouble between the Wagner group and the Russian military last week we saw energy prices go up by about 20%. Chinese economic activity at the moment is relatively low. If that starts to pick up we'll see more demand for gas in the form of LNG [Liquified Natural Gas], then we'll see European gas prices go up so there could be more volatility to come.”
The UK has some of the lowest gas storage levels in Europe.
The Rough storage facility, which is 18 miles off the coast of Yorkshire, was effectively mothballed in 2016 as new gas and electricity connections to Europe meant it was considered redundant.
It was brought back into partial service last October with three days' worth of the UK's average gas usage pumped in. From Friday, that will be doubled to six days' worth, bringing the UK's total reserves to 12 days.
“There is nowhere near enough gas storage, it could be more resilient,” said Mr O'Shea. “But it's far better than it was. So we've doubled the capacity and we should really not lose sight of that this makes a huge difference.”
In contrast, Germany has reserves of 90 days, France has 103 days and the Netherlands has 123 days' worth of gas.
Centrica said it would like to see Rough's capacity increased to 27 days' worth but that would require £2bn of investment which in turn, Mr O'Shea said, would require a government subsidy through a special pricing structure.
Looking ahead to winter, the Centrica boss acknowledged that many customers would find it difficult to pay energy bills at a time of rising food and housing costs.
British Gas came under fire earlier this year when The Times newspaper revealed that a contractor working for the company was force-fitting pre-payment meters in vulnerable customers' homes.
Force-fitting pre-payment meters was suspended across the industry for a time.
They can now be fitted again but Ofgem said customers must be given more chance to clear debts and forced meter fittings are banned in homes with residents all aged over 85.
Centrica is the subject of an ongoing Ofgem investigation. The company has brought its debt collection activities in-house but Mr O'Shea said there was still a problem in telling the difference between those who would not pay and those who genuinely couldn't.
He suggested the answer was to introduce a social tariff for the neediest customers funded from general taxation.
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“The government support that was put in place with the energy price guarantee was incredibly helpful for people but it wasn't targeted,” he said. “So it helped the richest as much as it helped the poorest in society.
“What we'd like to see is a social tariff put in place for those that need help most get the help most and those that don't get no help whatsoever.”
(qlmbusinessnews.com via bbc.co.uk – – Mon, 19th June 2023) London, Uk – –
Labour will end new North Sea oil and gas exploration, but help communities profit from clean power projects, Sir Keir Starmer has pledged.
Speaking in Edinburgh, the Labour leader vowed to “cut bills, create jobs and provide energy security”.
He also said that a previously announced publicly-owned green energy company will be based in Scotland.
Sir Keir is under pressure from environmentalists and the oil industry over the scale and pace of change.
Climate campaigners have criticised the party for rowing back on a pledge to invest £28bn a year in green industries.
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In England, planning rules which effectively ban new onshore wind farm developments will be scrapped if Labour wins the next election.
Labour has confirmed it would “not grant licences to explore new fields” in the North Sea, a momentous shift for a sector which supports 200,000 UK jobs, including 90,000 in Scotland, according to trade body Offshore Energies UK.
But the party insists it will honour any licences in existence at the time of the next election, which must be held by January 2025. That is likely to include the controversial new Rosebank development west of Shetland.
Sir Keir said: “Labour will deliver lower bills, good jobs, and energy security for Scotland and the whole UK, as Britain leads the world in the fight against climate change.”
One of Labour's initiatives will be to provide more incentives for areas to take part in new clean energy projects. Under Labour's plans, GB Energy – the new publicly-owned firm which it says will be based in Scotland at a location yet to be decided – would play a key role in getting that message across.
It would oversee the return of profits from successful projects to local councils. The councils could then use that income to reduce council tax, pay for improved public services or simply provide rebates on energy bills.
Labour says GB Energy could end up providing up to £600m per year to local councils to invest in green infrastructure and a further £400m annually in low interest loans for community projects.
These community loans would be designed to ensure small projects could benefit from the expertise of GB Energy while also generating money for local areas.
But Offshore Energy UK's chief executive David Whitehouse told the BBC that Labour's plans to move away from the reliance of North Sea oil and gas “would create a cliff edge”. deterring investment and heightening the risk of energy shortages.
Mr Whitehouse said 180 of the North Sea's 283 active oil and gas fields were due to close by 2030, and new licences were “essential” or production would “plummet” and “the UK and its skilled workforce will be exposed”.
When Scottish Labour leader Anas Sarwar discussed the proposals on the BBC's Sunday with Laura Kuenssberg, Sharon Graham, general secretary of the trade union Unite, responded on Twitter by calling his remarks “simply not acceptable,” accusing UK Labour of a “total lack of detail”, and adding “these throw away comments cost jobs”.
But Philip Evans, of Greenpeace UK, said the idea that the plans would “lead to an overnight shutdown of the industry” was nonsense.
Labour's opposition to new exploration licences represented “genuine leadership” he added, and the party was right “to debunk scare stories being peddled by climate delayers”.
‘No backsliding'
Mike Childs, head of science, policy and research at Friends of the Earth, welcomed Labour's latest ideas but warned “there can be no backsliding on pledges to stop new oil and gas extraction and invest in green growth”.
Environmental groups are particularly vocal about their opposition to the proposed Rosebank development in the North Atlantic.
Industry and government sources say the field could be approved by the UK government's North Sea Transition Authority within weeks.
Norwegian state-controlled oil company Equinor said Rosebank could produce almost 70,000 barrels of oil a day at its peak.
Sir Keir has held private talks with senior energy industry figures in the past week and previously gave direct assurances to Equinor that a Labour government would not revoke any licences.
Instead the party says its focus is on delivering “cheaper zero carbon power by 2030” and its “mission” includes plans to attract and incentivise investment “in the UK's industrial heartlands”.
That is likely to provoke comparisons with the approach taken by the US Democratic president Joe Biden whose Inflation Reduction Act has been described by the UK Conservative government's Business Secretary Kemi Badenoch as “protectionist”.
Sir Keir has accused the Conservatives and the SNP of having abysmal records on renewables. “Labour will deliver lower bills, good jobs, and energy security for Scotland and the whole UK, as Britain leads the world in the fight against climate change,” he said.
“The route to making Britain a clean energy superpower, slashing energy bills and creating tens of thousands of quality jobs, runs through Scotland,” Sir Keir added.
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The Scottish Conservatives' energy spokesman Liam Kerr described Labour's plans as “ruinous” for the UK's oil and gas industry, claiming they “would throw up to 90,000 highly skilled workers in the North East under a bus pretty much overnight”.
A Scottish government spokesperson said it was committed to “a planned and fair transition” away from fossil fuels that did not imperil jobs, adding: “Simply stopping all future activity overnight is wrong.
“It could threaten energy security while destroying the very skills we need to transition to the new low-carbon economy.”
(qlmbusinessnews.com via news.sky.com– Fri, 16th June 2023) London, Uk – –
An early report on preparations for the winter sees a lower risk of the lights going out despite continuing challenges for back-up generation.
The operator of Britain's electricity system says it is to keep a scheme that aims to help prevent blackouts for the coming winter.
National Grid ESO said it was “prudent to maintain” the demand flexibility service (DFS), which was introduced in 2022 in the wake of Europe's gas squeeze caused by the war in Ukraine.
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The operator added that the terms of the scheme were now out for consultation.
The DFS, which was activated for the first time in January after a series of tests and false alarms, sees volunteer households paid to turn off their main appliances at times of peak demand.
The ESO's early winter outlook report, due to be updated in September, expected sufficient capacity to meet demand this winter after the turmoil leading up to 2022/23 when gas flows from Russia were stopped, sparking a scramble for supplies on the continent.
It forecast a margin of 8% – a figure that is in line with most winter periods and up on the wriggle room it had expected last year.
It reduces the period when demand might outstrip supply to just 0.1 hours, down from 0.2 hours a year earlier.
ESO corporate affairs director Jacob Rigg said: “That's really healthy. But even within that there will be tight days.
“There will be cold snaps in the winter and therefore we do expect to use our normal operational tools.”
The ESO will be hoping the wind blows to aid generation from on and offshore wind farms as a reliance on coal to fill the void last winter will be constrained.
It confirmed there will be less coal-fired generation held in reserve.
“We are continuing to have discussions on the availability of having two (Drax) coal units in contingency contracts this winter.
“One of the units held in contingency last winter has returned to the market. The other two units have now closed,” the ESO explained.
The UK played a pivotal role in helping supply the continent with gas ahead of last winter amid a race to fill storage and stop the lights going out given historic dependency on Russian gas, particularly in Germany.
Britain, however, tends to import electricity from its North Sea neighbours during the winter months.
A relatively mild 2022/23 winter, coupled with alternative supply, meant Europe ended last winter with a record volume of gas in storage.
The report said of Britain's electricity output: “We expect there to be sufficient operational surplus in our base case throughout winter.”
While the ESO is confident on the capacity issue, market experts still expect gas and electricity costs to go up over the colder months as demand spikes.
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It could mean that household bills, through the energy price cap, start to rise again.
The cap kicks in again from July following the end of the government's energy price guarantee that limited the wholesale prices that consumers faced.
The level of the cap, at just above £2,000 for the average annual bill, is well down on the £2,500 estimate under the guarantee.
Futures contracts for natural gas see peak prices of 149p per therm in January.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 5th June 2023) London, Uk – –
Oil prices have risen after Saudi Arabia said it would make cuts of a million barrels per day (bpd) in July.
Other members of Opec+, a group of oil-producing countries, also agreed to continued cuts in production in an attempt to shore up flagging prices.
Opec+ accounts for around 40% of the world's crude oil and its decisions can have a major impact on oil prices.
In Asia trade on Monday, Brent crude oil rose by as much as 2.4% before settling at around $77 a barrel.
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Opec+ said production targets would drop by a further 1.4 million bpd from 2024.
The seven hour-long meeting on Sunday of the oil-rich nations came against a backdrop of falling energy prices.
Oil prices soared when Russia invaded Ukraine last year, but are now back at levels seen before the conflict began.
In October last year Opec+, a formulation which refers to the Organization of Petroleum Exporting Countries and its allies, agreed to cut production by two million bpd, about 2% of global demand.
In April this year the group agreed to a further cuts, which were due to last to the end of this year. But Russian Deputy Prime Minister Alexander Novak said that Sunday's talks led to “the extension of the deal until the end of 2024”.
Why are the world's big oil producers cutting supplies?
On Sunday, Saudi Energy Minister Prince Abdulaziz bin Salman said that his country's cut of one million bpd could be extended beyond July if needed. “This is a Saudi lollipop,” he said, in what is seen as a bid to stabilise the market.
Analysis: by Sameer Hashmi
Before the two-day Opec+ meeting started, it was widely expected the oil cartel would make production cuts to prop up prices. It appears most members were against the idea, as any cuts would impact oil revenues, which are crucial to keep running their economies.
Saudi Arabia's decision to make a voluntary reduction of one-million barrels per day was unexpected but does not come as a huge surprise. As the leader of the pack, and also the largest exporter of oil, it was the only one in a position to be able to lower output.
From Riyadh's point of view, it is crucial the price of crude remains over $80 a barrel for it to break even. Saudi officials want elevated prices to keep spending billions of dollars on ambitious projects spearheaded by Crown Prince Mohammed bin Salman, as he tries to diversify the kingdom's economy away from oil.
The move by the Saudis also underlines the uncertain outlook for demand for fuels in the months to come. Concerns about the global economy, especially recessionary fears in the US and Europe are expected to put further pressure on crude prices.
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Oil producers are grappling with falling prices and high market volatility amid the Russian invasion of Ukraine.
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The West has accused Opec of manipulating prices and undermining the global economy through high energy costs. It has also accused the group of siding with Russia despite sanctions over the invasion of Ukraine.
In response, Opec insiders have said the West's monetary policy over the last decade has driven inflation and forced oil-producing nations to act to maintain the value of their main export.
(qlmbusinessnews.com via news.sky.com– Wed, 17th May 2023) London, Uk – –
Britishvolt co-founder Orral Nadjari, speaking to Sky News in his first interview since the firm's collapse, claims government bureaucracy and delays were to blame for the firm's failure.
Britain has now missed its window of opportunity to build a battery industry, and the government, including Rishi Sunak, is largely to blame, the head of collapsed cell manufacturer Britishvolt has told Sky News.
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The company was feted as the jewel in Britain's manufacturing crown – the first home-grown gigafactory, co-financed by the government and turning out electric car batteries from its plant in the North East – but went into administration earlier this year.
Now, in his first interview since its implosion, co-founder Orral Nadjari blamed government bureaucracy for its failure.
“We lost that window of opportunity,” said Mr Nadjari. “We already are behind East Asia. We're already behind continental Europe. The UK, unfortunately, has lost out or is losing out on the gigafactory economy, which is massive in terms of job creation.
“Unfortunately we didn't see that same support from the Conservative government in order to level up the North East. Because the North East wasn't as important for them as maybe other places in this country.”
It comes as Vauxhall's parent company Stellantis called on the government to renegotiate its Brexit deal with the EU, telling a parliamentary committee's inquiry on electric vehicle production it was no longer able to meet trade rules on where parts are sourced.
Britishvolt had planned to build a large scale battery factory – a so-called gigafactory – at a site on the North East coast near Blyth.
The plans were hailed by the then Prime Minister Boris Johnson as “part of our Green Industrial Revolution” and the site was visited by then Business Secretary Kwasi Kwarteng.
But while the government agreed in principle to provide funds to help the company build the factory, Mr Nadari told Sky News the Treasury repeatedly dragged its heels.
He said even after all the necessary paperwork had been done, the relevant papers sat on the then Chancellor Rishi Sunak's desk for months before being formally approved.
That delay was fatal, Mr Nadjari alleged, because it meant that Britishvolt ended up trying to raise most of its money at a period of war and sky-high inflation, when global investment was cratering.
“Nobody could foresee a two digit inflation, that the country hasn't seen since 1955,” he said, adding that Britishvolt was “caught between a rock and a hard place” as Mr Sunak and Boris Johnson battled during the former prime minister's last days in office.
“Nobody could foresee three different prime ministers, four different chancellors… The UK saw a very turbulent time… and for a startup, what is important is that continuous capital injection and that really halted off and unfortunately because of that rivalry, we were hit with a delay.”
Claims ‘completely untrue'
The government disputes the timeline provided by Mr Nadjari, arguing that the final decision was awaiting approval for barely more than two months – as opposed to more than four – though it conceded it did insist on extensive due diligence before agreeing to provide public money.
A spokesperson said: “These claims are completely untrue. Taxpayer money must always be used responsibly which is why full due diligence was undertaken before a final grant offer was made.
“The grant offer, which was welcomed and accepted by the company, included an agreement that funds could only be drawn when agreed milestones are met, such as those on securing private investment. Unfortunately, these conditions were not met, and despite significant engagement from government, a solution was not found.
“The government remains committed to Levelling Up across the UK and is actively engaging with companies to secure investments that will ensure the UK remains a world leader in automotive manufacturing”.
‘No misappropriation of funds'
Following the collapse of the company, allegations surfaced about whether its bosses, including Mr Nadjari, had been running the company responsibly.
In particular, there were stories about use of private jets, about a mansion near the company's Blyth site which it rented for the use of executives and about large sums spent on computers and yoga lessons.
Mr Nadjari said: “Having a wellness instructor as a preventative measure for people's health is economical. To be able to do that virtually for 300 people at a low cost of roughly £2,000 to £3,000 a month – that is very economical.
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“There was no misappropriation of funds because not a single penny was spent on a private jet. £100,000 went to, as you say, a ‘mansion'… but it was a large house. And if you look at the cost of renting a hotel room for that many people during that period of time, it was far more economical to rent a house.
“The fact that it happened to have a pool, that wasn't working for 18 months by the way, has nothing to do with it.”
(qlmbusinessnews.com via news.sky.com– Wed, 3rd May, 2023) London, Uk – –
The company says it is “growing distributions” to shareholders as its headline profit number eases between January and March despite a strong oil and gas trading performance.
BP made profits of $5bn (£4bn) in the first quarter of the year, as the rewards for shareholders are being stepped up.
Underlying replacement cost profit between January and March compared to $6.2bn (£5bn) in the same period last year but $4.8bn (£3.9bn) achieved in the previous three months.
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The figure was $700m (£561m) higher than financial analysts had forecast.
The company described it as a resilient result which reflected an “exceptional gas marketing and trading result, a lower level of refinery turnaround activity and a very strong oil trading result”.
BP rewarded shareholders with a 6.6 cents per share dividend payment – up from 5.4 cents a year ago.
The sum was, however, static on the fourth quarter award and BP also scaled back the size of its recent share buybacks to $1.75bn (£1.4bn).
BP revealed details on its current performance as the government continues to face pressure to raise windfall taxes on energy giants to better cover the costs of energy support schemes.
BP paid $700m under the energy profits levy, introduced last May, for its North Sea activities during 2022.
It booked a further charge of $300m between January and March.
Labour argues the taxpayer should not be enduring so much of a burden for record household bills at a time when the likes of BP and Shell are benefiting from soaring prices linked to the war in Ukraine.
Labour leader Sir Keir Starmer has urged the government to ensure oil companies are hit with what he calls a “proper” windfall tax.
For its part, the government says it has to encourage continued investment in UK energy security.
Wholesale natural gas prices have tumbled from the record highs witnessed last year but remain elevated while oil costs are currently reflecting the slowdown in the global economy linked to the inflation problem.
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BP said it expected oil and European gas prices to remain strong by historical standards in the current second quarter.
Its report, which was titled “performing while transforming”, pointed to continued investment in its integrated energy strategy in both the UK and abroad.
In the North Sea, BP has signed an agreement to take a 40% stake in the Viking carbon capture and storage (CCS) project while three BP-led hydrogen and CCS projects in the North East have been chosen by the government to progress to the next stage of development
(qlmbusinessnews.com via uk.reuters.com — Tue, 21st Mar 2023) London, UK —
British power generator SSE will invest 100 million pounds ($122 million) in a Scottish pumped hydro scheme which could help boost the country’s energy storage capacity, it said on Tuesday.
Pumped hydro plants work by pumping water uphill to a higher reservoir before releasing it to enable water to flow downhill through turbines to produce electricity when it is needed.
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Developers of the technology say it can help to balance out a growing amount of renewable electricity on the power grid, using the surplus renewable power when demand is low to pump the water and storing it so it is ready to be released when demand is high.
The Coire Glas project, on the shores of Scotland’s Loch Lochy, could power about 3 million homes and would cost around 1.5 billion pounds to build, the company said.
A final investment decision is expected in 2024 and the project could be up and running by 2031 but the company said it needs clarity from the government on its policies around energy storage.
“Whilst Coire Glas doesn’t need subsidy, it does require more certainty around its revenues and it is critically important the UK Government urgently confirms its intention on exactly how they will help facilitate the deployment of such projects,” Gregor Alexander, SSE Finance Director said in a statement.
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The 100 million pounds invested now will be spent on design and advancing the project towards an investment decision and site investigation works, SSE said.
Britain’s government said during the budget last week that measures to support energy security will be announced later in March.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 13th 2023) London, Uk – –
More than four million struggling households are set to save £45 a year on energy bills from 1 July, the government has said.
This will happen by bringing prepayment energy charges in line with customers who pay by direct debit.
Households which have prepayment meters are typically vulnerable or on low incomes.
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But they pay more because energy firms pass on the costs of managing the meters.
Chancellor Jeremy Hunt, who is expected to announce the plan in his Spring Budget on Wednesday, said it was “clearly unfair that those on prepayment meters pay more than others”.
The extra charges struggling households would have paid will instead be met under the government-funded Energy Price Guarantee at a cost of £200m.
Regulator Ofgem will report on how to permanently end the “prepayment penalty” when that government support ends in April 2024, the Treasury said.
Prepayment meters have been under the spotlight in recent months.
Last month it emerged that debt agents acting for British Gas had broken into vulnerable people's homes to force-fit meters, and that courts had been waving through energy firm applications to forcibly install meters.
Ofgem, which is reviewing prepayment meters, told energy firms at the end of February to start compensating customers whose homes were wrongfully fitted with a prepayment meter.
Firms were banned from installing prepayment energy meters under warrant, but that is due to end at the end of March.
In November last year it was revealed that a rising number of households are having their smart meters remotely switched to prepayment meters.
Energy Security Secretary Grant Shapps said: “Charging prepayment meter customers more to receive their energy is a tax on some of our most vulnerable – this change will stop that.”
Labour said the government had “finally listened” to its calls for “an end to the unfair prepayment meter penalty”.
“Their delay will be cold comfort for the millions of prepayment customers who have been paying higher energy bills as a result of the government's indecisiveness,” said Ed Miliband, Labour's shadow climate and net zero secretary.
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In addition to prepayment help, the government is expected to extend the Energy Price Guarantee at current levels for a further three months.
Typical household energy bills were going to rise to £3,000 a year from April, the government is expected to retain its current level of support with the cap at £2,500.
(qlmbusinessnews.com via news.sky.com– Mon, 27th Feb 2023) London, Uk – –
Octopus Electric Vehicles is working with bankers at Investec on securing a big funding boost at a time of rising EV production in the UK, Sky News learns.
The electric vehicles arm of Octopus Energy's parent company is seeking a £100m funding boost to accelerate its growth amid soaring production of greener cars.
Sky News has learnt that Octopus Electric Vehicles (OEV) is working with bankers on plans to raise new funding from external investors during the coming months.
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OEV is part of Octopus Energy Group, which secured a $5bn valuation just over a year ago and is now one of Britain's residential energy suppliers.
This week, a judicial review brought by rival groups including Centrica, the owner of British Gas, will challenge the government's handling of the sale of Bulb, the energy group which collapsed in 2021 and was recently sold to Octopus Energy.
The fundraising for OEV comes as data published by the Society of Motor Manufacturers and Traders showed that the number of EVs produced in the UK in January rose by nearly 50% compared to a year earlier.
OEV offers a salary sacrifice scheme that it believes removes one of the principal barriers to electric vehicle adoption.
Its clients include Dyson, the property portal Zoopla and Bain & Company, the consulting firm, and it is adding roughly 85,000 employees to its potential customer base each quarter.
Bentley to end production of ‘iconic' W12 petrol engine in move to electric
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BMW in talks with UK government over £75m grant for electric Mini
Electric Cars
The business is run by chief executive Fiona Howarth, a former executive at BMW and Ovo Energy.
OEV's competitors include the likes of Onto, Zenith and LeasePlan.
Octopus Energy declined to comment on the fundraising, which is being handled by advisers at Investec.
(qlmbusinessnews.com via theguardian.com – – Tue, 21st Feb 2023) London, Uk – –
Ofgem says energy companies must compensate customers now rather than wait until its review is complete
Ofgem has told energy suppliers to uninstall prepayment meters that have been wrongly force-fitted and pay compensation now, rather than wait for the outcome of a review.
The watchdog is examining the prepayment meter market after it emerged that suppliers were routinely fitting thousands of meters to recover debts by using court warrants to gain entry into people’s homes, including those of vulnerable people.
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Ofgem has told suppliers to pause the forced installation of prepayment meters (PPMs), but the ban will last only until 31 March, when its review is due to conclude.
The energy regulator has now laid out the parameters of an investigation into the sector, and into the actions of British Gas, after a Times report this month revealed that debt agents working for the supplier had broken into the homes of vulnerable people.
That followed months of calls from charities and MPs to tackle prepayment meters, amid evidence that people were being switched on to prepayment tariffs remotely and cut off from heat and power as they could not afford to top up.
On Tuesday, Ofgem’s chief executive, Jonathan Brearley, said: “I’m telling suppliers not to wait for the outcome of our reviews and to act now to check that PPMs have been installed appropriately and, if rules have been broken, [to] offer customers a reversal of installations and compensation payments where appropriate. There will also be fines issued from Ofgem if the issue is found to be systemic.”
The regulator has set out the parameters of its compliance review, which will look at how executives at energy suppliers scrutinise decisions to switch households on to prepay; what company policies exist; how vulnerability is identified in their customers; and what compulsory training programmes they use.
A separate investigation, into British Gas, will look at whether the company takes every action possible before switching a customer on to prepay; how it assesses a customer’s “mental capacity and/ psychological state”; and assess whether agents are “fit and proper” to visit and enter customers’ homes.
Brearley said: “I am concerned about the way customers in already distressing situations are being treated when suppliers force them on to PPMs. That’s why, today, we have set out further details on the two investigations, one into British Gas for potential breaches that have been alleged indicating that something went very badly wrong at British Gas and the other into PPMs across all suppliers to assess whether this is an isolated case.”
Gillian Cooper, the head of energy policy at Citizens Advice, said: “We’ve seen far too many cases of people who are struggling to pay their bills being forced on to a prepayment meter despite clear evidence this isn’t safe for them … Ofgem is right to repeat our call for suppliers to check if customers need to be moved off a prepayment meter.
“If suppliers don’t heed this call, the regulator must be ready to step in. If progress isn’t made, the government must take action.”
There are also concerns that people on prepayment meters are missing out on government support designed to cushion the blow of rising bills.
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Brearley was asked on Tuesday morning whether he had considered resigning after calls from the former prime minister, Gordon Brown, for him to quit. He did not answer the question directly, instead telling BBC Radio 4’s Today programme: “We’re going through the biggest energy crisis I think we’ve ever had in our history.”
He added that the industry was investigating a social tariff to help low-income households with their energy bills and urged consumers to “do your homework” before locking in fixed-price deals, amid signs that offers to encourage switching will soon return to the sector.
(qlmbusinessnews.com via theguardian.com – – Thur, 2nd Feb 2023) London, Uk – –
Sunak government under pressure after gas prices fuel ‘outrageous’ doubling of profits at Anglo-Dutch group
The government is under pressure to rethink its windfall tax on energy companies after Shell reported one of the largest profits in UK corporate history, with the surge in energy prices sparked by Russia’s invasion of Ukraine pushing the oil company’s annual takings to $40bn (£32bn).
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Opposition parties and trade unions described Shell’s bonanza, the biggest in its 115 year history, as “outrageous” and accused Rishi Sunak of letting fossil fuel companies “off the hook”.
On Thursday, the UK headquartered company confirmed it had paid just $134m in British windfall taxes during 2022. It paid $520m under the EU “solidarity contribution” – Europe’s equivalent of the windfall tax.
The company was criticised in October when it said it had paid no UK windfall tax up to that point, but on Wednesday said it was likely to contribute $500m in 2023.
Boosted by record oil and gas prices, Shell posted profits of almost $10bn in the final quarter of last year, taking its annual adjusted profits to $40bn in 2022, far outstripping the $19bn notched up in 2021.
The performance puts Shell on a par with the £38bn British American Tobacco made in 2017, but still behind the £60bn Vodaphone achieved in 2014, when the telecoms group sold its US business.
The shadow climate change secretary, Ed Miliband, said: “As the British people face an energy price hike of 40% in April, the government is letting the fossil fuel companies making bumper profits off the hook with their refusal to implement a proper windfall tax.”
Miliband added: “Labour would stop the energy price cap going up in April, because it is only right that the companies making unexpected windfall profits from the proceeds of war pay their fair share.”
The Liberal Democrat leader, Ed Davey, said: “No company should be making these kind of outrageous profits out of [Vladimir] Putin’s illegal invasion of Ukraine.
“Rishi Sunak was warned as chancellor and now as prime minister that we need a proper windfall tax on companies like Shell and he has failed to take action.”
Paul Nowak, the general secretary of the TUC, said the profits were “obscene” and “an insult to working families”.
Global Witness alleges just 1.5% of Shell’s capital expenditure has been used to develop genuine renewables.
Shell’s actual spending on renewables is fraction of what it claims, group alleges
The step up in Shell and its competitors’ profits during 2022 prompted the government to introduce a windfall tax on North Sea operators, which was later toughened by the chancellor, Jeremy Hunt.
Nowak said windfall taxes should be increased. “As households up and down Britain struggle to pay their bills and make ends meet, Shell are enjoying a cash bonanza. The time for excuses is over. The government must impose a larger windfall tax on energy companies. Billions are being left on the table,” he said.
“Instead of holding down the pay of paramedics, teachers, firefighters and millions of other hard-pressed public servants, ministers should be making big 0il and gas pay their fair share.”
Shell has benefited from a surge in oil prices caused by embargoes on Russian oil imposed since the invasion of Ukraine, and Russia’s decision to cut off gas supplies to continental Europe.
Analysts had expected Shell’s new chief executive, Wael Sawan, to report adjusted earnings of $7.97bn for the fourth quarter and $38.17bn for the year, in his City debut. It represented an increase on the $9.45bn registered in the third quarter, aided by a bounceback in earnings from its liquefied natural gas trading arm.
Sunak’s official spokesperson said No 10 was aware the public would view Shell’s profits as “extraordinary” high, which was why the government had introduced its windfall tax comparable to those seen in other countries, he added.
“We think it [the profits levy] strikes a balance between funding cost of living support while encouraging investment in order to bolster the UK’s energy security,” they said. “We have made it clear that we want to encourage reinvestment of the sector’s profits to support the economy, jobs and energy security, and that’s why the more investment a firm makes into the UK the less tax they will pay.”
Sawan announced a boost in payouts to shareholders, with a 15% increase in the final quarter dividend to $6.3bn.
He also announced $4bn of share buybacks over the next three months. In total, Shell distributed $26bn to shareholders in 2022.
Asked how it felt to make huge profits while people struggle with their bills, Sawan said: “These are incredibly difficult times, we’re seeing inflation rampant around the world … When I go back home to Lebanon some of the challenges I see people going through, sometimes without electricity for a full day, are the the challenges that we see in many, many parts of the world. The answer to that is to make sure we provide energy to the world.”
Shell has also been accused of overstating how much it is spending on renewable energy, and faced calls this week to be investigated and potentially fined by the US financial regulator.
Shell invested $25bn overall during 2022, up from $20bn in 2021. The firm spent $12bn on oil and gas projects, compared with $3.5bn on its renewable energy division.
The Greenpeace UK senior climate justice campaigner Elena Polisano said: “World leaders have just set up a new fund to pay for the loss and damage caused by the climate crisis. Now they should force historical mega-polluters like Shell to pay into it.”
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Jonathan Noronha-Gant, a senior campaigner at Global Witness, said: “People have every right to be outraged at the enormous profits that Shell has made in the midst of an energy affordability crisis that has pushed millions of families into poverty.”
The company, which has a stock market valuation of $165bn, last week embarked on a review of its division supplying energy and broadband to homes in Europe, putting 2,000 UK jobs at risk.
(qlmbusinessnews.com via theguardian.com – – Thur, 19th Jan 2023) London, Uk – –
British multinational to spend huge sums on schemes that do not bring genuine carbon reductions, analysis shows
More than 90% of rainforest carbon offsets by biggest provider are ‘worthless’
Greenwashing or a net zero necessity? Scientists on carbon offsetting
Carbon offsets flawed but we are in a climate emergency
The fossil fuel firm Shell has set aside more than $450m (£367m) to invest in carbon offsetting projects, and plans to buy the equivalent of half the current market for nature offsets every year, the Guardian can reveal.
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But a joint investigation by the Guardian, Die Zeit and Source Material into Verra, the world’s leading carbon standard for the rapidly growing $2bn voluntary offsets market, has found, based on analysis of a significant percentage of the projects, that more than 90% of their rainforest offset credits – among the most commonly used by companies – are likely to be “phantom credits” and do not represent genuine carbon reductions.
Shell, one of the five largest oil companies in the world, has said it plans to ramp up spending on measures to counterbalance its polluting activities in an effort to decarbonise.
Its strategy is to have a “philosophy of avoid, reduce and only then mitigate”, in theory putting nature-based carbon credits at the back of the queue in its efforts to decarbonise.
But it appears that the company has, in fact, put offsetting at the heart of its climate strategy. The scale of Shell’s plans is striking, with a target of using nature-based solutions (NBS) – its term for carbon offsetting projects – to “mitigate emissions of around 120m metric tonnes of CO2 equivalent (MtCO2e) per year by 2030”. That figure is roughly half the size of the current entire annual market for nature offsets, which is about 227.7m MtC02e.
Shell has set targets to reduce its scope 1 and 2 emissions by at least 27m tonnes, from 68m in 2021 to 41m in 2030, through a number of strategies including the use of renewable power and improvements in efficiency. The company expects NBS to account for between 2m and 7m tonnes of this reduction, underlining its importance to Shell’s decarbonisation plans.
In 2020, Shell invested about $90m in nature-based projects and bought an Australian company that works on developing and monitoring carbon sequestration projects. The following year, Shell announced ambitions to invest about $100m a year in nature-based projects, although it said these plans were being slowed by the Covid-19 outbreak. That year, it allocated more than $480m to various projects – more than $456m of it for NBS projects – to be deployed across the length of the contracts.
The company has also referred to offsetting as part of its carbon-reduction strategy in its appeal against the landmark judgment by a Dutch court last year that Shell must reduce its emissions by 45% by 2030.
And it has been intimately involved in the creation of the carbon market, with staff sitting in key advisory posts. At least three Shell staff sit on advisory groups for Verra, a US non-profit that operates the world’s leading carbon standard.
Verra’s former director of programmes is a carbon offsetting manager at Shell, while the oil major’s former head of nature-based solutions has just co-founded a new carbon credits rating agency that helps companies find supposedly high-quality credits with a Verra advisory group member.
Global carbon offsetting markets have grown rapidly, with many companies turning to them as part of their net zero plans and emphasising the benefits they can offer. Mark Carney, the ex-governor of the Bank of England, headed a plan to make offsets work, describing them as a way of helping companies get to net zero and “an incredibly important market”, although cautioning that they could not be “a silver bullet that removes responsibility from anyone for reducing absolute emissions”.
But there have also been significant concerns raised about whether all offsets really work. The Guardian investigation analysed the findings of three scientific studies that used satellite images to check the results of a number of forest offsetting projects, known as Redd+ schemes, and found that, based on the results of two of the studies, about 94% of the credits the projects produced should not have been approved.
Verra strongly disputes the findings and argues that the methodology used by the scientists means that the results are incorrect. They also point out that their work since 2009 has allowed billions of dollars to be channelled to the vital work of preserving forests.
A Shell spokesperson told the Guardian: “As part of our efforts to become a net-zero energy business by 2050, we are investing billions of dollars in lower-carbon energy, including investments in low-carbon fuels, renewable power and hydrogen.
“Where we use carbon credits, it is in line with our philosophy of avoid, reduce and only then mitigate emissions. They can help protect or restore natural ecosystems, and offer a near-term solution for addressing emissions that cannot be immediately abated. The carbon credits Shell uses and invests in are independently verified by third parties. We are working in collaboration with government, business and civil society to help strengthen the integrity and effectiveness of the carbon market.”
The findings of the investigation will raise serious questions for Shell, and for many corporations that are counting on rainforest-based carbon offsets as part of their plan for reducing their emissions. As businesses race to declare their plans for reaching net zero, carbon offsets have been a critical part of their plans, and the market has grown exponentially.
Lavazza, for example, says its coffee pods are carbon neutral using one project in Peru that stopped no deforestation, according to the analysis. Leon used the same scheme to claim its burgers were carbon neutral; the housebuilder Berkeley Group used it to say it was the UK’s first carbon-positive builder; and easyJet used it for carbon-neutral flying until changing its policy.
Gucci, BHP, Salesforce.com and Pearl Jam all used offsets from another Peruvian scheme that only avoided around a 10th of the emissions it was claimed, according to the analysis. Disney used credits from a Cambodian scheme that was about nine times less effective than claimed.
Boeing bought credits from a Colombian project estimated tostop no deforestation for its net-zero manufacturing claim, according to the studies, and smaller companies have also bought the offsets, including a UK tipi rental company and a financial services firm.
When asked to comment Gucci, Pearl Jam, BHP, Berkeley Groupand Salesforce did not comment, while Lavazza said it bought credits that were certified by Verra, “a world’s leading certification organisation”, as part of the coffee products company’s “serious, concrete and diligent commitment to reduce” its carbon footprint. It plans to look more closely into the project.
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The fast food chain Leon no longer buys carbon offsets from one of the projects in the studies, as part of its mission to maximise its positive impact. EasyJet has moved away from carbon offsetting to focus its net zero work on projects such as “funding for the development of new zero-carbon emission aircraft technology”. And Boeing said that although it does buy offsets its reduction strategy is focussed on conserving energy resources and increasing the use of renewals, so that the number of offsets it buys fell by nearly 19% between 2020 and 2021.
Thomas Crowther, professor of ecology at ETH Zürich and co-chair of the United Nations Decade on Ecosystem Restoration who reviewed the findings of the investigation, told the Guardian: “Limiting deforestation is absolutely essential for achieving our climate and biodiversity targets. But transparency remains a key challenge, and it is critical that we use the best available scientific approaches to ensure the accountability of environmental commitments at scale”
“Companies and citizens need to be able to support projects they can trust. We need to urgently create a system where this is a reality.”
(qlmbusinessnews.com via theguardian.com – – Thur, 12th Jan 2023) London, Uk – –
Ukraine war’s effect on wholesale gas prices prompts third upgrade in a year from Centrica
The owner of British Gas, Centrica, expects a near eightfold increase in its earnings this year due to its balance sheet being boosted by soaring wholesale gas prices after Russia’s invasion of Ukraine.
The FTSE 100 group said on Thursday it expected earnings a share to be more than 30p this financial year. That represents an upgrade on City expectations of 23.6p to 26.6p a share, far outstripping the 4p a share generated in 2021, when pre-tax profits hit £761m.
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It is the third time Centrica has upgraded its annual expectations this financial year, and the second time in three months.
In a brief, unscheduled statement to investors, Centrica said it had “continued to deliver strong operational performance from its balanced portfolio” and expects to have more than £1bn of cash on its balance sheet for this year.
The statement risks stoking further anger over the profits made by energy producers since the outbreak of war in Ukraine, which has pushed up wholesale gas prices far above historical averages.
The company – alongside UK oil and gas giants BP and Shell – faced criticism on reporting bumper profits while consumers struggled with bills last year.
Centrica said in November that the performance of its North Sea gasfields and electricity generation assets – it owns 20% of the UK’s nuclear fleet – meant full-year profits would be towards the top end of expectations.
“The upgrade appears to be driven by stronger profits in the trading and gas storage businesses, which is a continuation of the themes Centrica has seen through the year,” said RBC analyst Alexander Wheeler.
The company reinstated its dividend with a £59m payout to shareholders last year and in November launched a £250m share buyback, the first since 2014.
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However, analysts expect Centrica’s business supplying homes with gas and electricity to make a loss in the second half of the year. British Gas last year announced it would donate 10% of its profits to help its poorer customers manage rising gas and electricity bills for the “duration of the energy crisis”.
Centrica’s shares – which have risen more than 30% over the last 12 months – increased 6% to 97p on Thursday morning, making it the top riser on the FTSE 100. It will report full-year results on 16 February.
(qlmbusinessnews.com via theguardian.com – – Thur, 29th Dec 2022) London, Uk – –
US oil firm contests legal authority for ‘solidarity contribution’ to raise funds to offset soaring energy prices.
ExxonMobil has launched a legal challenge against the EU in an attempt to derail the bloc’s windfall tax on the profits of energy producers.
In a high-stakes political battle as countries across Europe and the wider western world struggle with soaring energy costs and sky-high inflation, the US oil firm said it believed the EU had overreached its powers with the windfall tax.
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Agreed in September as part of a package of measures to tackle the surge in oil, gas and electricity prices triggered by Russia’s war in Ukraine, the EU hopes the “solidarity contribution” could raise €25bn (£22bn) in public revenue for governments across the 27-nation bloc, while acting to curtail energy demand and bring down prices.
ExxonMobil, however, said the proposals were misleading and could discourage industry investment in the production of affordable energy.
Filed on Wednesday by its German and Dutch subsidiary companies at the European general court in Luxembourg, the company’s lawsuit challenges Brussels’ legal authority to impose the new tax.
“Our challenge is targeted only at the counter-productive windfall profits tax, and not any other elements of the package to reduce energy prices,” ExxonMobil said in a statement.
“This tax will undermine investor confidence, discourage investment, and increase reliance on imported energy and fuel products. European industries already face a very real competitiveness crisis and governments should be supporting the production of reliable and affordable energy.”
Exxon estimates windfall profit taxes imposed by Europe could cost at least $2bn to the end of 2023, its chief financial officer told analysts earlier this month. The company said it had invested $3bn in the past decade in refinery projects in Europe, helping to reduce European reliance on imports from Russia.
The launching of a legal case by a US oil supermajor against the EU comes as fossil fuel giants come under mounting pressure on both sides of the Atlantic over the vast profits energy companies have reported this year.
The US president, Joe Biden, hit out earlier this month, saying ExxonMobil had “made more money than God this year”, and has since accused oil companies of “war profiteering” and raised the possibility of imposing a windfall tax if they fail to boost domestic production.
ExxonMobil reported a third-quarter profit of nearly $20bn (£17.3bn) in October, nearly triple the previous year and the most in its 152-year history.
Oil companies have raked in record profits in recent months, thanks to the surge in the price of oil and natural gas after Russia’s invasion of Ukraine in late February, causing soaring energy bills for consumers and businesses. Over the last two quarters, BP, Chevron, ConocoPhillips, ExxonMobil, Shell and TotalEnergy earned over $100bn more than they earned all of last year, and more than two-and-a-half times what they earned in the same quarters of 2021.
Labelling the fossil fuel profits boom as “outrageous”, Biden has suggested the firms were more likely to funnel excess profits back to shareholders than boost their investment in new production capacity.
“I have no problem with corporations turning a fair profit or getting the return on their investment and innovation. But this isn’t remotely what’s happening,” he said.
“Oil companies’ record profits today are not because they’re doing something new or innovative. Their profits are a windfall of war.”
Exxon said it would factor in the EU windfall tax as it considers future multibillion euro investments in the continent’s energy supply and transition to renewable energy production.
“Whether we invest here primarily depends on how attractive and globally competitive Europe will be,” said Casey Norton, a spokesperson for the company.
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The firm said it recognised that the energy crisis was “weighing heavily on families and businesses”, and that it was working to increase energy supplies to Europe as the continent pushes to reduce its consumption of Russian energy.
Several European countries, including in Germany, Spain and Italy, have introduced local windfall taxes on energy company profits. The UK chancellor, Jeremy Hunt, increased the government’s windfall tax on North Sea oil and gas firms from 25% to 35%, and extended it by two years until March 2028.
(qlmbusinessnews.com via bbc.co.uk – – Mon 12th Dec 2022) London, Uk – –
National Grid has ordered two coal plants to begin warming up in case electricity supplies to the UK are disrupted because of the cold weather.
The company said it asked Drax, which owns Britain's biggest power station, to prepare two coal-fired units.
It also said it was running a test of its scheme that offers discounts on bills for households who cut peak-time electricity use on Monday evening.
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The move comes as the UK experiences a snap of freezing temperatures.
It means demand for energy rises as more people heat their homes, and a lack of wind has reduced the amount of renewable energy available.
It is understood because of the cold temperatures, Monday will be the highest demand day for electricity so far this winter.
National Grid said that while it had asked Drax to warm up its two coal-fired units at its site near Selby, North Yorkshire, the plants might not be used.
It said the move “should give the public confidence in Monday's energy supply” and added households should “continue to use energy as normal”.
The UK receives electricity via subsea cables from European countries including France, Norway, Belgium and the Netherlands, but higher demand in Europe could potentially disrupt supplies to the UK and would trigger the need for coal-generated energy.
In October, National Grid warned there was a risk of blackouts over the winter months as a last resort if energy supplies reach low levels.
Fintan Slye, executive director of National Grid, told the BBC on Monday that power outages were “still a possibility”, but said the network operators remained “cautiously optimistic through the winter that we will be able to manage it”.
“We have enough supplies secured through the rest of the day that we can manage that and ensure there's no disruption to customers' supplies,” he told the BBC's Today programme.
However, the electricity system operator (ESO) arm of National Grid said it was running a test of a scheme on Monday that offers discounts on bills for households who cut their electricity use at peak times between 17:00 and 19:00.
It allows people to save cash if they avoid high-power activities, such as cooking or using washing machines, when demand is high. National Grid has said this could save households up to £100 over the winter.
But only homes with smart meters and whose supplier is signed up to the “Demand Flexibility Scheme” will be able to take part. About 14 million homes, less than half of all households in England, Scotland and Wales, have a smart meter installed.
Mr Slye said the test had been triggered because National Grid wanted to “test how consumers would respond when the weather was really cold”. It is understood a decision was made by National Grid at 14:30 GMT on Sunday.
According to National Grid ESO's website, British Gas, EDF, Eon and Octopus are signed up to the scheme but Scottish Power appears not to be.
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Octopus told the BBC that almost 250,000 of its customers had signed up to Monday's two-hour test so far, adding that its customers across the country had been paid £1m so far from taking part in previous “saving sessions”.
British Gas also confirmed it would be contacting customers to take part in Monday's scheme, but EDF said it would not be participating as it was finalising its plans.
By Michael Race & Dearbail Jordan
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