S&P Global — 11 September 2024
Daily Update: September 11, 2024
Renewables 'Back in the Game' Under New UK Government
By Nathan Hunt
Start every business day with our analyses of the most pressing developments affecting markets today, alongside a curated selection of our latest and most important insights on the global economy
The UK’s Labour government has moved quickly to accelerate the development of renewable energy projects. Spooked by energy prices that climbed to unprecedented heights following Russia’s invasion of Ukraine, Prime Minister Keir Starmer’s government appears eager to reduce dependence on foreign energy sources. In the process, it is demonstrating an often-overlooked advantage of renewable energy: the ability of sources such as wind and energy to provide energy security while reducing emissions.
On July 8, shortly after assuming office, UK Chancellor Rachel Reeves changed earlier guidance on where onshore wind in England could be built. The new guidance was designed to minimize opportunities for local opposers of onshore wind projects to register objections and speed up approval processes. Reeves is also considering categorizing onshore wind projects as Nationally Significant Infrastructure Projects, the government's streamlining process for major infrastructure planning.
Offshore wind is progressing in the UK after the government awarded contracts on 35% of the total eligible pipeline of new offshore wind projects. Further auctions to award the remaining contracts are planned, although critics have expressed concern that the UK may be falling behind other countries in offshore wind development for energy generation.
"It's a perfect example of how expectations have been reframed," said Alon Carmel, renewable energy expert at PA Consulting. "[Offshore wind is] not so much ‘back on track’ as ‘back in the game.’ On track suggests we're on track to reach the targets, which we're very much not."
Offshore wind industry leader Ørsted was awarded a 2.4-GW contract for its Hornsea 4 offshore wind farm bid, while Iberdrola won a 963-MW contract for the East Anglia TWO project. Together, the developments will require an estimated investment between £8.7 billion and £10.1 billion.
Solar has also been prioritized by the new Labour government. On Sept. 5, the UK Department for Energy Security and Net Zero approved Island Green Power's 600-MW Cottam Solar Project. The project, which will occupy four sites for a total 1,150 hectares, is the largest government-approved solar project in the UK to date. The new solar fields will use the grid connection from the now-demolished Cottam coal-fired power plant. Energy Secretary Ed Miliband previously granted planning consent for three additional major new solar farms shortly after the election.
Today is Wednesday, September 11, 2024, and here is today’s essential intelligence.
Listen: A Closer Look At Utah Project Converting Renewables Into Hydrogen For Later Use
This episode of Energy Evolution is all about the Advanced Clean Energy Storage project in Delta, Utah. ACES will use electrolysis to convert renewable energy into hydrogen and store it so that the otherwise intermittent resources will be dispatchable on demand from storage in large salt caverns underground. The first project will convert and store up to 100 metric tons per day of hydrogen and is expected to enter commercial-scale operations in mid-2025.
—Listen and subscribe to the podcast from S&P Global Commodity Insights
Serving Up Volatility: How US Presidential Elections Rally the Securities Lending Markets
Presidential elections in the US are like grand slam tennis matches: strategic, competitive and marked by long rallies of back-and-forth action. The ball ricochets back and forth across the net, with each candidate’s policy serve affecting different parts of the financial court. But how do these political volleys impact the critical world of securities lending and financing in the US?
—Read the article from S&P Global Market Intelligence
Charting New Frontiers: The S&P 500® ESG Index’s Outperformance of the S&P 500
The investment landscape has witnessed a significant shift toward sustainability in recent years, with growing emphasis on ESG considerations without sacrificing performance. In this environment, the S&P 500 ESG Index has emerged as a remarkable benchmark, improving ESG scores while also performing similarly to or even better than the S&P 500 since its launch, more than five years ago.
—Read the article from S&P Dow Jones Indices
Manufacturing Downturn Spreads From Europe To America, But UK Bucks The Malaise
A global factory downturn is showing signs of spreading from Europe to America. While Asia is the stand-out regional performer, even here there are large pockets of weakness — notably mainland China and Japan. Besides India and Thailand, the UK is notable in bucking the broader downturn, albeit suffering from supply chain delays amid trade constraints, which could pose an inflation risk.
—Read the article from S&P Global Market Intelligence
APPEC: Oil Prices Not Staring At 'Boom', But 'Bust' Is Also Not Near
Oil prices may not be heading higher anytime soon as China's appetite shows signs of slowing and US economic may face some demand pressures, but robust outlook in some other demand centers, such as India, could provide a floor to the market, speakers at the Asia Pacific Petroleum Conference (APPEC) said. "For oil markets, I don't expect a boom. Certainly, things are slowing down. But does that mean a bust? I don't think so. Markets will be stagnant perhaps and that's bad enough for oil, " said Torbjörn Törnqvist, chairman of Gunvor while speaking at a panel titled "Boom or Bust? The Future of Oil Prices."
—Read the article from S&P Global Commodity Insights
Self-Driving Cars Gain Momentum in US
The summer of 2024 saw steady developments related to autonomous vehicles (AV) in the United States. Self-driving startup Waymo continues to be the leader, while disruptions at GM's Cruise AV division are proving to be a bump in the road and, arguably, a situation where the lessons learned may leave the division in a better position. Though progress has not come at the pace predicted in the 2017-18 period, potential for the technology to truly transform the way people and goods move in society remains compelling.
—Read the article from S&P Global Mobility
In-Person Event: 8th Annual European Perspectives Seminar: The Big Picture (Munich, Germany)
Europe's economic landscape experiences a delicate balance. The year started strong with most of Europe's top banks reporting higher profits in the first quarter as the benefits from high interest rates remained steady in the first months of the year. However, the recent “flash” PMI® survey data from S&P Global Market Intelligence indicates a cooling in economic growth, particularly in manufacturing, defying consensus expectations of a further acceleration in growth.
—Register for the in-person event from S&P Global Market Intelligence