The global energy crisis will continue to deepen and should act as an alarm call now about the decent long-term future rewards in sustainable investments, says the CEO of a leading global financial giant.
The analysis from Nigel Green, CEO and founder of deVere Group, one of the world’s largest independent financial advisory, asset management and fintech organisations, comes amid a flurry of international energy concerns.
On Monday, the European Union agreed to forge ahead with a partial ban on Russian oil. The action forbids the purchase of crude oil and petroleum products from Russia delivered to member states by sea.
It follows news that six million households face power blackouts over winter due to Russian threats that it will cut the EU’s gas supply, with the UK Government now drawing up plans for rationed electricity.
Elsewhere, U.S. oil inventories are already 14% below their five-year average; China – the world’s number two economy – has been battling its most severe energy crisis in a decade; and in South Africa, amongst other countries, there continues to be widespread rolling blackouts as supply falls behind demand.
Mr Green says: “The global energy crisis is only set to deepen. It’s not going away any time soon.
“The crunch was started by the world economy rebounding from the pandemic faster than was anticipated, bringing to the fore supply and infrastructure issues.
“But the rebound’s impact isn’t the only reason for the international energy crisis we’re currently experiencing.
“Nor is the ongoing war between Russia and Ukraine, which is slashing supply globally.
“Intrinsic demand is also surging due to a 1% rise per year in global population growth, plus the increase in wealth and consumption of the growing global middle class.”
However, what is now a big headache for households and policymakers is also an opportunity for investors.
“The energy crisis should serve as a catalyst for the energy transition.
“The current situation around the world must be dealt with in the short-term; but it has brought into sharp focus that rather than staying with fossil fuels, the longer-term answer to this and future energy crunches is to accelerate investment into sustainable projects that deliver cleaner power.
“Investors, keen to get ahead of the curve as well as earn profits with purpose, will be more keenly seeking out the opportunities as the world scrabbles to mitigate the environmental, economic and social fallout of the current situation – a situation which is likely to be a constant risk moving forward.
“They will be moving quickly to have an early advantage, foreseeing the undeniable value, necessity and rewards of sustainable investing.”
deVere highlighted its own commitment to back environmental, social and governance (ESG) values last year by being one of 18 founding signatories of a UN-backed Net Zero initiative, alongside the world’s two largest credit rating agencies, six major audit networks, three leading index providers, and two global stock exchanges.
The international alliance of powerhouse global finance companies will help accelerate the transition to a net zero financial system.
Nigel Green concludes: “The worsening global energy crisis is a defining issue of our time, and it represents a key opportunity for investors seeking to build long-term wealth with a purpose.”
Nigerian Power Consumers Hit by Massive Overbilling, N105bn Raked by Discos
Nigerian power consumers are reeling from the impact of massive overbilling, with power distribution companies (Discos) collectively raking in N105 billion in nine months.
An analysis of the latest monthly data from January to September 2023 revealed that approximately 7.1 million unmetered electricity consumers across the nation fell victim to inflated bills.
The Nigerian Electricity Regulatory Commission (NERC), the federal agency overseeing the power sector, disclosed that the overbilling stemmed from the failure of Discos to adhere to the prescribed monthly energy caps for unmetered customers.
The overbilling issue has raised serious concerns about the financial burden on consumers and the credibility of the power distribution system.
A breakdown of the figures showed that various Discos were involved in overbilling activities, with significant discrepancies noted in the amounts charged against the estimated energy consumption.
For instance, Abuja Disco overbilled approximately 1.8 million customers by N17.9 billion, while Ikeja Disco charged 934,438 customers an excess of N20.9 billion during the review period.
The overbilling trend has prompted a swift response from NERC, which has vowed to take punitive measures against non-compliant Discos.
As part of its regulatory intervention, NERC announced plans to deduct N10.5 billion from the annual allowed revenues of the 11 Discos during the next tariff review.
Consumers, already grappling with the economic challenges, have expressed outrage over the overbilling saga.
Many have voiced concerns about the impact of excessive bills on their household budgets, calling for urgent measures to address the issue and restore transparency and fairness to electricity billing practices.
Nigeria’s Energy Sector Set for Growth as Akpo West Field Adds 14,000 Barrels per Day
Nigeria’s energy landscape is poised for significant expansion with the imminent commencement of production at the Akpo West field, a development expected to bolster the nation’s condensate output by 14,000 barrels per day (bpd).
The Akpo West field, owned by TotalEnergies and its partners, represents a pivotal advancement in Nigeria’s energy sector, promising to enhance the country’s position in the global oil market.
TotalEnergies, in collaboration with its partners, has unveiled plans for the Akpo West field, located on Petroleum Mining Lease (PML) 2, situated 135 kilometers off the Nigerian coast.
The field is strategically positioned to leverage existing infrastructure, minimizing costs and reducing greenhouse gas emissions.
Initial estimates indicate that the project’s carbon intensity will be below 5 kg CO2e/barrel of oil equivalent, contributing to TotalEnergies’ efforts to mitigate environmental impact.
The Akpo West development is anticipated to commence by mid-2024, marking a significant milestone in Nigeria’s energy sector.
With the addition of 14,000 bpd of condensate production, Nigeria’s total condensate output is poised to witness a notable surge.
Condensate, a highly sought-after light crude oil, commands premium prices in the global market, enhancing Nigeria’s revenue potential and economic resilience.
Furthermore, the Akpo West project underscores TotalEnergies’ commitment to sustainable energy development and innovation.
By harnessing existing infrastructure and optimizing operational efficiency, the project aims to maximize production while minimizing environmental footprint.
The launch of the Akpo West field represents a transformative moment for Nigeria’s energy sector, promising growth, innovation, and enhanced global competitiveness in the realm of oil and gas production.
Dangote Petroleum Refinery to Fuel 150,000 IPMAN Outlets Nationwide Following Successful Meeting
The Dangote Petroleum Refinery is poised to supply fuel to approximately 150,000 retail outlets affiliated with the Independent Petroleum Marketers Association of Nigeria (IPMAN).
The decision follows a successful meeting between the refinery’s management and top executives from IPMAN that agreed to bolster the nation’s energy supply chain.
Key industry players, including major oil marketers such as 11 Plc, Conoil Plc, Ardova Plc, MRS Oil Nigeria Plc, OVH Energy Marketing Limited, Total Nigeria Plc, and NNPC Retail, have already enrolled for product distribution from the state-of-the-art Dangote facility, which commenced the production of diesel and aviation fuel on January 12, 2024.
While regulatory assessments are underway before the final nod for fuel dispensing, IPMAN’s president expressed optimism about the positive impact this collaboration would have on the country.
“The meeting went well, so right now we are just expecting their reply in terms of the products that they are going to give us. They have agreed to dispense products to IPMAN members,” commented IPMAN’s president, reassuring that the Dangote Refinery, one of the largest in the world, is well-equipped to meet the nation’s consumption needs.
With the refinery’s promise to address fuel scarcity and bring products to market, IPMAN anticipates a transformative impact on Nigeria’s fuel distribution landscape, providing a potential solution to prevailing challenges in the sector.
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