Connect with us

Energy

Worsening Energy Crisis is a Major Opportunity for Investors

Published

on

Oil

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.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading
Comments

Energy

Renewables Can Provide Nearly 60 Per Cent of Nigeria’s Energy Demand by 2050

Published

on

Renewable Energy - Investors King

Nearly 60 per cent of Nigeria’s energy demand in 2050 can be met with renewable energy sources, saving 40 per cent in natural gas and 65 per cent in oil needs at the same time, according to a new report by the International Renewable Energy Agency (IRENA).

With a growing population and a range of socioeconomic challenges, Nigeria requires sustainable energy sources to meet the growing needs for all the sectors of its economy and achieve universal access to modern energy services.

Renewable Energy Roadmap for Nigeria, developed in collaboration with the Energy Commission of Nigeria, demonstrates how renewable energy technologies are key to achieving a sustainable energy mix and meeting the country’s growing needs.

“By using its abundant, untapped renewables”, IRENA’s Director-General Francesco La Camera said, “Nigeria can provide sustainable energy for all its citizens in a cost-effective manner. Nigeria has a unique opportunity to develop a sustainable energy system based on renewables that support socioeconomic recovery and development, while addressing climate challenges and accomplishing energy security.”

Dr. Adeleke Olorunimbe Mamora, Nigeria’s Minister of Science, Technology and Innovation added: “The highly distributed institutional structure of the energy sector in Nigeria means that coordination of policies will be essential to unlocking integrated energy transition planning and ensuring its success. A cross cutting agency or body tasked with doing so would be helpful in building consensus and developing a coherent plan which in turn would allow for the scaling up of renewable energy to meet the needs across the Nigerian energy sector.”

The share of primary energy requirements met with renewable energy can reach 47 per cent by 2030 and 57 per cent by 2050, according to IRENA’s report. Electrification will play a significant role in achieving higher renewable energy shares with electricity in final energy use nearly doubling by 2050.

Investment in renewables will be more cost-effective than the conventional pathway. IRENA’s Energy Transition Scenario has lower investment costs than planned policies, 1.22 trillion USD compared to 1.24 trillion USD respectively. This corresponds to 35 billion USD versus 36 billion USD per year respectively.

Advancing the energy transition requires a shift and scaling-up of investments in the short-term to avoid locked in fossil fuel  infrastructure investments with long lifetimes such as natural gas pipelines. In 2050, significantly less use of natural gas and oil compared to planned policies has profound implications for infrastructure investment in fossil fuels, increasing the risk of stranded assets.

Policies for the accelerated deployment of renewables are needed to unlock the report’s benefits. Policy coordination is essential to unlocking successful integrated energy transition planning in Nigeria.

Continue Reading

Energy

NERC Ascribes DisCos Losses to Energy Theft, Refusal to Pay Bills by Customers

Published

on

Electricity

The Nigerian Electricity Regulatory Commission (NERC) has revealed that the Electricity Distribution Companies (DisCos) in the country lose N4.79 out of every N10 worth of energy sold.

The NERC, has however attributed the losses suffered by the 11 electricity distribution companies to ineffective distribution networks, energy theft, poor revenue collection and refusal of customers to pay their bills promptly.

Investors King gathered that the Aggregate Technical, Commercial and Collection (ATC&C) loss of the DisCos amounted to 47.88 percent in Q1 of 2022.

The data from NERC further explained that the distribution companies recorded 22.62 percent technical and commercial losses and 32.64 percent collection loss.

“Conversely, DisCos that underperform relative to their allowed ATC&C losses (i.e., a higher ATC&C loss than allowed), will be unable to earn the expected returns on its set tariffs and could risk long-term financial challenges. 

“The ATC & C loss was largely driven by Benin (56.75%), Kano (53.89%), Kaduna (74.86%), Enugu (54.19%), and Jos (67.92%) DisCos,” NERC said.

The Commission directed the distribution companies to embark on emergency remedial actions to enhance their ATC&C losses by increasing revenue means.

It noted that if the situation persists, the companies will incur much debts which will affect their equity and hinder them from meeting the target.

“Failure to resolve this will not only prevent the DisCos from being able to meet their upstream obligations, but it will also saddle them with too much debt and erode their equity,” NERC stated.

The Electricity Regulatory body stated that on market remittance, the bills of both Nigeria Bulk Electricity Trading Plc (NBET) and the Market Operator (MO) to DisCos was N205.63 billion in the first quarter of 2022.

The breakdown of the invoices earmarks N164.86 billion as generation cost and N40.77 billion as cost for transmission and administrative services. The DisCos collectively paid a total sum of N135.69 billion from the estimated bill left with  N69.94 billion outstanding balance, placing its remittance performance at 65.99 percent.

Continue Reading

Energy

Demand For Solar Energy Globally Rising Fast, Sales May Exceed $220bn in 2023– Report

Published

on

Nigeria solar panels multiple

Sales of solar energy globally might reach $220bn this year as its demand has greatly risen by 25–30 percent, says Bloomberg Intelligence (BI) new report.

Investors King understands that solar energy is the fastest-growing segment of the energy sector in 2023 which may extend to subsequent years with bigger sales.

According to Bloomberg Intelligence, in its Global Solar Energy 2023 Outlook, the demand for solar energy in 2022 rose about 40 percent with industry revenues at 50 percent.

“The double digit growth is fuelled by favourable economics: a new solar system’s levelised cost of electricity is about $40 a megawatt hour, roughly in line with a new wind plant and over 50% cheaper vs a new coal one.

“We expect 2023 revenue to increase the quickest at inverter manufacturers and equipment suppliers. Sales at Enphase are expected to be up 35 percent in 2023 and 29 percent at SolarEdge,” the report stated.

BI further predicted that the cost of installing solar power is likely to become less expensive compared to nuclear power in subsequent years as manufacturing improves. 

The International Energy Agency (IEA), also declared that solar energy will surpass coal power by 2027, saying the energy crisis and war in Ukraine will direct attention to renewables.

The IEA pointed out that renewable energy will top sources of electricity generation globally in 2025 and twice as much renewable capacity will be derived from 2022 to 2027. 

BI Senior Analyst for Clean Energy, Rob Barnett, said the fast growth line of solar energy sales amongst popular energy firms will not drop as measures to improve its growth are fixed.

Barnett said, “The growth of solar follows a record 2022, during which global solar capacity additions expanded about 47 percent”.

“Best-in-class peers such as Enphase or First Solar could see their sales growth exceed 30% in 2023, and amid such fast line growth, we believe profitability metrics are poised to improve based on an easing of input costs and supply chain constraints.”

Continue Reading
Advertisement
Advertisement




Advertisement
Advertisement
Advertisement

Trending