28 June 2011
Enphase Energy, a Californian solar startup, has boosted its coffers by $14 million ahead of a planned $100 million initial public offering (IPO).
Enphase, which manufactures solar microinverters, told the US regulator on Friday it had raised the money through a combination of debt and equity, and hopes to sell a further $37.5 million in equity.
The Nasdaq hopeful could net up to $151.5 million through its combined pre-IPO and IPO raisings.
Enphase manufactures microinverters, small electronic devices which attach to solar panels and monitor and adjust power generation capacity.
It posted a loss of nearly $22 million in 2010 on revenues of $61.6 million, while the first three months of this year saw it post a $9.2 million loss against $18 million in revenues.
The IPO is underwritten by Morgan Stanley, Bank of America Merrill Lynch, Jefferies, ThinkEquity and Lazard Capital Markets.
Charlotte Dudley
Wednesday, 29 June 2011
US renewables ready for return to tax break – JP Morgan
27 June 2011
The renewable energy sector will not miss the US government’s cash grant programme as much as industry experts think, because of the growing attractiveness of the production tax credit (PTC) for wind projects, according to one top banker.
The Section 1603 Treasury cash grant programme, which allows developers to opt for a cash payment instead of a tax break, is set to expire at the end of 2011 and an extension is considered highly unlikely in the current political and economic environment.
“There’s a rush to get wind farms qualified for the grant to have that option available,” said Chicago-based John Eber, managing director of energy investments for JP Morgan. “There’s certainly not much activity going on beyond 2012 in wind, as people wait to hear about the extension of the tax benefits. We don’t expect to see the grant extended, but we do expect to see the PTC extended.”
Some wind farms turning down cash for tax break
But some US wind farms already see the PTC as the better option and market dynamics may encourage more projects to opt for the tax break over the grant, Eber told attendees of the Renewable Energy Finance Forum-Wall Street in New York last week.
The PTC’s attractiveness starts with the dramatic fall in turbine prices, which reduces the value of the grant, and the technology improvements leading to significantly higher capacity factors, which are driving projects toward the tax credits, he said. Additionally, power prices are stabilising and utilities are taking advantage by signing contracts at fairly attractive prices, leaving developers to seek the best economic deal they can get from the financing process, Eber said.
“All in all, we think the PTC is going to be a more attractive marketplace for a greater percentage of the wind developers than we’ve seen before,” he said. “With the growth in the tax equity market and the tax equity investors, I expect the capital will be there.”
JP Morgan estimates that the tax equity market will invest about $4.5 billion in wind and solar projects this year, a slight drop-off from the nearly $4.7 billion invested last year.
“I wouldn’t be a bit surprised if it ends up being greater than that with deals coming into the market before the end of the year,” Eber said.
By JP Morgan’s count, 18 investors are active on the equity side and five more investors are interested, but have not yet successfully completed deals. “We’re working with them to maybe bring more investors into the market,” he said.
Others fear end of cash grant
But Eber seems to have the minority opinion as other financiers and developers express grave concerns about the pending expiration of the cash grant programme.
If the cash grant is allowed to expire, there will be a $3 billion-6 billion gap between the amount of tax equity capacity and demand, said Kevin Walsh, managing director of GE Energy Financial Services. “We’re very concerned,” he added. “The tax equity market continues to be constrained and will be more so if the grant goes away.”
The tax equity market only has about 12-15 active investors, noted Los Angeles-based Lance Markowitz, senior vice-president and manager of leasing and asset finance for Union Bank, a unit of MUFG Group that is a major provider of debt and equity financing for renewable energy projects.
“I’m optimistic the market will cover good, solid projects,” he said. “The market will gravitate to the better ones. Post-grant really is late 2012 and I think you’re going to see by that time bigger appetites from investors.”
The net benefit to the US economy from the cash grant and PTC was about $100 million in 2010, according to GE. “There’s an initial drain on the Treasury from the grant and PTCs, but then these projects do pay taxes,” Walsh argued.
Gloria Gonzalez
The renewable energy sector will not miss the US government’s cash grant programme as much as industry experts think, because of the growing attractiveness of the production tax credit (PTC) for wind projects, according to one top banker.
The Section 1603 Treasury cash grant programme, which allows developers to opt for a cash payment instead of a tax break, is set to expire at the end of 2011 and an extension is considered highly unlikely in the current political and economic environment.
“There’s a rush to get wind farms qualified for the grant to have that option available,” said Chicago-based John Eber, managing director of energy investments for JP Morgan. “There’s certainly not much activity going on beyond 2012 in wind, as people wait to hear about the extension of the tax benefits. We don’t expect to see the grant extended, but we do expect to see the PTC extended.”
Some wind farms turning down cash for tax break
But some US wind farms already see the PTC as the better option and market dynamics may encourage more projects to opt for the tax break over the grant, Eber told attendees of the Renewable Energy Finance Forum-Wall Street in New York last week.
The PTC’s attractiveness starts with the dramatic fall in turbine prices, which reduces the value of the grant, and the technology improvements leading to significantly higher capacity factors, which are driving projects toward the tax credits, he said. Additionally, power prices are stabilising and utilities are taking advantage by signing contracts at fairly attractive prices, leaving developers to seek the best economic deal they can get from the financing process, Eber said.
“All in all, we think the PTC is going to be a more attractive marketplace for a greater percentage of the wind developers than we’ve seen before,” he said. “With the growth in the tax equity market and the tax equity investors, I expect the capital will be there.”
JP Morgan estimates that the tax equity market will invest about $4.5 billion in wind and solar projects this year, a slight drop-off from the nearly $4.7 billion invested last year.
“I wouldn’t be a bit surprised if it ends up being greater than that with deals coming into the market before the end of the year,” Eber said.
By JP Morgan’s count, 18 investors are active on the equity side and five more investors are interested, but have not yet successfully completed deals. “We’re working with them to maybe bring more investors into the market,” he said.
Others fear end of cash grant
But Eber seems to have the minority opinion as other financiers and developers express grave concerns about the pending expiration of the cash grant programme.
If the cash grant is allowed to expire, there will be a $3 billion-6 billion gap between the amount of tax equity capacity and demand, said Kevin Walsh, managing director of GE Energy Financial Services. “We’re very concerned,” he added. “The tax equity market continues to be constrained and will be more so if the grant goes away.”
The tax equity market only has about 12-15 active investors, noted Los Angeles-based Lance Markowitz, senior vice-president and manager of leasing and asset finance for Union Bank, a unit of MUFG Group that is a major provider of debt and equity financing for renewable energy projects.
“I’m optimistic the market will cover good, solid projects,” he said. “The market will gravitate to the better ones. Post-grant really is late 2012 and I think you’re going to see by that time bigger appetites from investors.”
The net benefit to the US economy from the cash grant and PTC was about $100 million in 2010, according to GE. “There’s an initial drain on the Treasury from the grant and PTCs, but then these projects do pay taxes,” Walsh argued.
Gloria Gonzalez
Millions of tonnes of wood being wasted every year
At least two million tonnes of unused woodfuel supplies a year could be used to heat rural schools, businesses and other buildings, the Forestry Commission has said.
5:36PM BST 28 Jun 2011
At least two million tonnes of unused woodfuel supplies a year could be used to heat rural schools, businesses and other buildings, the Forestry Commission has said.
Tapping into the extra wood supplies for fuel in England could help create green growth, improve woodlands and help reduce greenhouse gases, the Commission said.
Woodchip boilers in hundreds of mid-size buildings such as schools, blocks of flats or social housing, hospitals and smaller businesses could use fuel from local woodlands.
It could particularly benefit areas which are not on the gas grid and rely on oil for heating, reducing the costs of energy and their carbon emissions.
The Forestry Commission estimates that by 2020, an extra two million tonnes a year of woodfuel could be used for heating buildings in England.
Currently across the UK as a whole less than 1.5 million tonnes of home-grown wood is used as fuel.
Overall, the Forestry Commission estimates that the woodfuel industry could generate £1 billion and support more than 15,000 jobs in the UK.
It could also improve the management of English woodlands, around half of which are currently under-managed, as trees in dense woods are thinned to produce the fuel, opening up the forest which benefits wildlife.
Launching the Forestry Commission's woodfuel implementation plan at an event in Manchester, chairwoman Pam Warhurst, said: "Win, win, win is a phrase often wheeled out yet it is not always convincing. But for woodfuel it is absolutely true.
"Sustainably grown and locally used woodfuel is good for rural businesses, improves woodland health and wildlife and cuts climate change emissions.
"According to our figures about half of the woodland in England is under-managed. This means there is a great deal of wood, at least two million tonnes a year, that could be used for woodfuel and it is just sitting there as woodlands slowly suffer.
"This could supply enough energy to heat the equivalent of 800 hospitals or 3,000 schools and save 1.5 million tonnes of CO2 a year, roughly the emissions from three million barrels of crude oil.
"At today's prices the woodfuel alone could be worth around £120 million."
Woodfuel boilers will attract benefits from the Renewable Heat Incentive, which will pay people for the heat they generate from green sources, while the Forestry Commission said it will have a £10 million grant scheme which will support the sustainable production of woodfuel.
5:36PM BST 28 Jun 2011
At least two million tonnes of unused woodfuel supplies a year could be used to heat rural schools, businesses and other buildings, the Forestry Commission has said.
Tapping into the extra wood supplies for fuel in England could help create green growth, improve woodlands and help reduce greenhouse gases, the Commission said.
Woodchip boilers in hundreds of mid-size buildings such as schools, blocks of flats or social housing, hospitals and smaller businesses could use fuel from local woodlands.
It could particularly benefit areas which are not on the gas grid and rely on oil for heating, reducing the costs of energy and their carbon emissions.
The Forestry Commission estimates that by 2020, an extra two million tonnes a year of woodfuel could be used for heating buildings in England.
Currently across the UK as a whole less than 1.5 million tonnes of home-grown wood is used as fuel.
Overall, the Forestry Commission estimates that the woodfuel industry could generate £1 billion and support more than 15,000 jobs in the UK.
It could also improve the management of English woodlands, around half of which are currently under-managed, as trees in dense woods are thinned to produce the fuel, opening up the forest which benefits wildlife.
Launching the Forestry Commission's woodfuel implementation plan at an event in Manchester, chairwoman Pam Warhurst, said: "Win, win, win is a phrase often wheeled out yet it is not always convincing. But for woodfuel it is absolutely true.
"Sustainably grown and locally used woodfuel is good for rural businesses, improves woodland health and wildlife and cuts climate change emissions.
"According to our figures about half of the woodland in England is under-managed. This means there is a great deal of wood, at least two million tonnes a year, that could be used for woodfuel and it is just sitting there as woodlands slowly suffer.
"This could supply enough energy to heat the equivalent of 800 hospitals or 3,000 schools and save 1.5 million tonnes of CO2 a year, roughly the emissions from three million barrels of crude oil.
"At today's prices the woodfuel alone could be worth around £120 million."
Woodfuel boilers will attract benefits from the Renewable Heat Incentive, which will pay people for the heat they generate from green sources, while the Forestry Commission said it will have a £10 million grant scheme which will support the sustainable production of woodfuel.
David Cameron must speak out on climate change, says top scientist
Sir David King, a former chief scientific adviser, writes in the Guardian to urge prime minister to fill 'leadership vacuum'
Damian Carrington
The Guardian, Wednesday 29 June 2011
David Cameron must end his silence on climate change and "step up to the plate" to provide international leadership, the former government chief scientific adviser Prof Sir David King says on Wednesday.
Writing in the Guardian, King also reveals that after his declaration that global warming was a greater threat than global terrorism in 2004, then US president, George Bush, asked Tony Blair, then prime minster, for to have him gagged.
King's warning made headlines around the world at the time. "But I refused to be gagged, and that statement and others spurred the UK to develop a leadership role on climate change among the international community," King writes.
He argues that the UK's 2008 Climate Change Act – the most ambitious legally binding emissions targets in the world – along with actions such as its early engagement with China on global warming put the UK at the forefront of global negotiations on climate action in the runup to the UN summit in Copenhagen in 2009. This summit, attended by scores of world leaders, failed to reach a global deal, and subsequent summits have been far less prominent.
"There is, again, a leadership vacuum among heads of states on this issue, just as there was in the early 2000s. Will David Cameron step up to the plate, please? Prime minister, will you take your stated credentials as [wanting to lead] the 'greenest government ever' into the global arena?" writes King, who is now director of the Smith School of Enterprise and the Environment at Oxford University, where a world forum on "valuing ecosystem services" opens today.
Downing Street was unable to provide a comment, but a spokesperson at the dDepartment of Energy and Climate Change said: "From the top down, the coalition has no intention of letting up in its efforts to get a legally binding agreement. [Energy and climate change secretary] Chris Huhne, with the prime minister's full backing, played a crucial role at the UN climate conference in Cancún to get agreement on the overall goal of limiting climate change to two degrees, to establish a new climate 'green fund' and to take further action to reduce deforestation."
A Liberal Democrat source in government also pointed out that deputy prime minister Nick Clegg, the deputy prime minister, had emphasised climate change issues during recent visits by Barack Obama and China's premier, Wen Jiabao.
Green party MP Caroline Lucas said: "I share Sir David King's deep disappointment at the prime minister's lack of personal engagement in the international climate negotiations process. It is astonishing that Cameron has yet to make a single statement on his commitment to securing an international climate change agreement."
Cameron has had to intervene repeatedly to ensure his coalition's green commitments were not derailed, including in a fierce cabinet battle over the UK's target of a 50% cut in greenhouse gas emissions by 2025. He also had to face down Treasury objections to the government's green investment bank and, most recently, has contended with a mutiny among his MEPs over European emissions targets.
The prime minister has made high-profile speeches defending the UK's relatively high level of international aid spending, – one of very few areas ring-fenced from cuts – but he has yet to make any similar intervention on climate change.
Phil Bloomer at Oxfam, which praised the government's stance on international aid, said: "If David Cameron wants to lead the greenest government ever, he must urgently take on the international leadership needed to inject fresh life in the UN talks, so the empty climate fund is filled and poor communities can protect themselves from the impacts of climate change."
King praises the government's domestic action on climate change. "My cynicism about pre-election statements was squashed with the announcement that the UK will cut its CO2 emissions by 50% by 2025," he writes, noting that policies on the green investment bank, on improving home energy efficiency, and on reforming the electricity market to deliver low-carbon electricity provide "excellent opportunities for the radical transition to a low-carbon economy".
He says the UK is once again "setting the bar high for other countries", but adds: "There has been no statement at all from the government about the need for collective action on the critical issue [of climate change]."
Barry Gardiner MP, who is Ed Miliband's special envoy on climate change, said: "If Cameron had spent a quarter of a billion pounds tackling climate change instead of bombing Gaddafi, he could have transformed Britain's energy infrastructure to meet our 2025 targets, protected a million hectares of rainforest from deforestation, or fitted solar [panels] to 100,000 homes. It is clear that he thinks Libyan oil is a bigger priority."
Friends of the Earth's senior parliamentary campaigner Martyn Williams said: "The need for bold leadership on climate change is more urgent than ever but the prime minister and leader of the opposition rarely speak out on climate change, and this has created a dangerous vacuum. Urgent action is needed to avoid a climate disaster and reap the huge financial opportunities that would be created by building a low-carbon future."
Damian Carrington
The Guardian, Wednesday 29 June 2011
David Cameron must end his silence on climate change and "step up to the plate" to provide international leadership, the former government chief scientific adviser Prof Sir David King says on Wednesday.
Writing in the Guardian, King also reveals that after his declaration that global warming was a greater threat than global terrorism in 2004, then US president, George Bush, asked Tony Blair, then prime minster, for to have him gagged.
King's warning made headlines around the world at the time. "But I refused to be gagged, and that statement and others spurred the UK to develop a leadership role on climate change among the international community," King writes.
He argues that the UK's 2008 Climate Change Act – the most ambitious legally binding emissions targets in the world – along with actions such as its early engagement with China on global warming put the UK at the forefront of global negotiations on climate action in the runup to the UN summit in Copenhagen in 2009. This summit, attended by scores of world leaders, failed to reach a global deal, and subsequent summits have been far less prominent.
"There is, again, a leadership vacuum among heads of states on this issue, just as there was in the early 2000s. Will David Cameron step up to the plate, please? Prime minister, will you take your stated credentials as [wanting to lead] the 'greenest government ever' into the global arena?" writes King, who is now director of the Smith School of Enterprise and the Environment at Oxford University, where a world forum on "valuing ecosystem services" opens today.
Downing Street was unable to provide a comment, but a spokesperson at the dDepartment of Energy and Climate Change said: "From the top down, the coalition has no intention of letting up in its efforts to get a legally binding agreement. [Energy and climate change secretary] Chris Huhne, with the prime minister's full backing, played a crucial role at the UN climate conference in Cancún to get agreement on the overall goal of limiting climate change to two degrees, to establish a new climate 'green fund' and to take further action to reduce deforestation."
A Liberal Democrat source in government also pointed out that deputy prime minister Nick Clegg, the deputy prime minister, had emphasised climate change issues during recent visits by Barack Obama and China's premier, Wen Jiabao.
Green party MP Caroline Lucas said: "I share Sir David King's deep disappointment at the prime minister's lack of personal engagement in the international climate negotiations process. It is astonishing that Cameron has yet to make a single statement on his commitment to securing an international climate change agreement."
Cameron has had to intervene repeatedly to ensure his coalition's green commitments were not derailed, including in a fierce cabinet battle over the UK's target of a 50% cut in greenhouse gas emissions by 2025. He also had to face down Treasury objections to the government's green investment bank and, most recently, has contended with a mutiny among his MEPs over European emissions targets.
The prime minister has made high-profile speeches defending the UK's relatively high level of international aid spending, – one of very few areas ring-fenced from cuts – but he has yet to make any similar intervention on climate change.
Phil Bloomer at Oxfam, which praised the government's stance on international aid, said: "If David Cameron wants to lead the greenest government ever, he must urgently take on the international leadership needed to inject fresh life in the UN talks, so the empty climate fund is filled and poor communities can protect themselves from the impacts of climate change."
King praises the government's domestic action on climate change. "My cynicism about pre-election statements was squashed with the announcement that the UK will cut its CO2 emissions by 50% by 2025," he writes, noting that policies on the green investment bank, on improving home energy efficiency, and on reforming the electricity market to deliver low-carbon electricity provide "excellent opportunities for the radical transition to a low-carbon economy".
He says the UK is once again "setting the bar high for other countries", but adds: "There has been no statement at all from the government about the need for collective action on the critical issue [of climate change]."
Barry Gardiner MP, who is Ed Miliband's special envoy on climate change, said: "If Cameron had spent a quarter of a billion pounds tackling climate change instead of bombing Gaddafi, he could have transformed Britain's energy infrastructure to meet our 2025 targets, protected a million hectares of rainforest from deforestation, or fitted solar [panels] to 100,000 homes. It is clear that he thinks Libyan oil is a bigger priority."
Friends of the Earth's senior parliamentary campaigner Martyn Williams said: "The need for bold leadership on climate change is more urgent than ever but the prime minister and leader of the opposition rarely speak out on climate change, and this has created a dangerous vacuum. Urgent action is needed to avoid a climate disaster and reap the huge financial opportunities that would be created by building a low-carbon future."
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