Latest news with #Short-TermEnergyOutlook
Yahoo
4 days ago
- Business
- Yahoo
3 Alternative Energy Stocks to Watch Amid Escalated Tariff Uncertainty
America's booming electric vehicle market, backed by the rapid decarbonization demand of the transport sector, should bode well for alternative energy stocks in the near term. However, enhanced import tariffs imposed by the U.S. government recently, which have only exacerbated the already high cost situation of the industry, might hurt the growth trajectory of these stocks. Despite these challenges, the U.S. Energy Information Administration ('EIA') has forecasted a 4.5% year-over-year increase in U.S. wind generation in 2025. This growth should play the role of a catalyst for the alternative energy stocks, offsetting some headwinds. Some prominent forerunners in the U.S. alternative energy industry are Bloom Energy BE, Ormat Technologies ORA and Standard Lithium SLI. About the Industry The Zacks Alternative Energy industry can be fundamentally segregated into two sets of companies. While one group is involved in the generation and distribution of alternative energy and electricity from sources like wind, natural gas, biofuel, hydro and geothermal, the other is engaged in the development, design and installation of renewable projects involving these alternative energy sources. The industry also includes a handful of stocks that offer fuel cell energy solutions, which have gained popularity as an affordable clean energy lately. Per the BlooombergNEF's latest Energy Transition Investment Trends report published in January 2025, global spending on clean energy reached record levels of $2.08 trillion in 2024. With similar or more investments expected in clean energy in the coming years, the industry boasts solid growth opportunities for its participants. 3 Trends Shaping the Future of the Alternative Energy Industry Wind Energy – A Key Growth Catalyst: Among alternative energy sources, wind energy has been making noticeable progress in the United States. Per the American Clean Power Association's latest clean power market report, a solid 1,327 megawatts (MW) of land-based wind were installed in the first quarter of 2025. Looking ahead, per the Short-Term Energy Outlook published by the U.S. Energy Information Administration (EIA) in February 2025, wind generation in the United States is projected to increase 4.5% year over year in 2025, with 7.7 GW of wind generation capacity expected to be added to the U.S. grid this year. This reflects a solid growth opportunity for the U.S. wind market at present, which, in turn, should boost the overall expansion of the alternative energy industry. EV Market Boom to Boost Clean Energy: Electric vehicles (EVs) are playing a pivotal role in the decarbonization of the U.S. transportation sector. The ongoing shift toward electrification, spurred by government subsidies, tax rebates, grants, and incentives such as carpool lane access, is encouraging more Americans to transition from gasoline-powered vehicles to EVs. Falling battery costs are also accelerating the expansion of the EV market. According to the Alliance for Automotive Innovation, 433,843 EVs were sold in the United States in the fourth quarter of 2024, representing a 15% year-over-year increase. Looking ahead, the U.S. EV market is expected to witness a compound annual growth rate (CAGR) of 12.6% between 2025 and 2029 and reach a projected market volume of $154.2 billion by 2029, as per estimates from Statista. This strong growth outlook bodes well for clean energy companies, particularly those that operate extensive EV charging networks across the country. Rising Raw Material Costs & Tariff Headwinds: The steadily rising cost of raw materials used in renewable installations over the past few years, primarily owing to the shortage of components arising out of the global supply-chain crisis, has already sparked concerns about the energy transition industry's future among stakeholders. This situation has been further exacerbated by the recent decisions taken by the U.S. government. Evidently, Donald Trump's executive order in January 2025, pausing offshore wind leasing and permitting, delivered a fatal blow to the U.S. offshore wind industry.. Moreover, the exorbitant import tariff that the Trump administration has imposed lately on America's trading partners has the potential to jeopardize the nation's decarbonization plans. President Trump raised steel and aluminum tariffs by 25% in March 2025, ending all country exemptions, in addition to higher tariffs on China. Since America is largely reliant on other nations for the import of these metals used in power grids and renewable projects, such tariff imposition will further put pricing pressure on the nation's clean power industry. Consequently, in the first quarter of 2025, clean energy projects worth $8 billion were cancelled. While it is too early to predict the extent to which the American clean energy industry will suffer amid such a high-tariff situation, the volatility in the global trade map and the resultant ripple effect might keep the growth trajectory of the alternative energy stocks constricted to some extent in the near term. Zacks Industry Rank Reflects Grim Outlook The Zacks Alternative Energy industry is housed within the broader Zacks Oils-Energy sector. It carries a Zacks Industry Rank #143, which places it in the bottom 42% of more than 250 Zacks industries. The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates gloomy near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. The industry's position in the bottom 50% of the Zacks-ranked industries is due to a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts have lost confidence in this group's earnings growth potential over the past few months. The industry's bottom-line estimate for the current fiscal year has moved down 0.9% to $2.17 since March 31. Before we present a few alternative energy stocks that you may want to consider for your portfolio, let's take a look at the industry's recent stock-market performance and valuation picture. Industry Beats Sector and S&P 500 The Alternative Energy Industry has outperformed its sector as well as the Zacks S&P 500 composite over the past year. The stocks in this industry have collectively surged 41.9% in the past year against the Oils-Energy sector's 9.8% decline. The Zacks S&P 500 composite has gained 11.7% in the same time frame. One-Year Price PerformanceIndustry's Current Valuation On the basis of the trailing 12-month EV/EBITDA ratio, which is commonly used for valuing alternative energy stocks, the industry is currently trading at 21.48 compared with the S&P 500's 16.65 and the sector's 4.59. Over the past five years, the industry has traded as high as 21.85X, as low as 8.88X and at the median of 10.43X, as the charts show below. EV-EBITDA Ratio (TTM)3 Alternative Energy Stocks to Watch Ormat Technologies: Based in Reno, NV, the company is primarily engaged in the geothermal energy power business. On May 27, 2025, Ormat Technologies announced a $62 million Hybrid Tax Equity partnership with Morgan Stanley Renewables to support its Lower Rio and Arrowleaf energy storage and solar projects, expected to be operational by the end of 2025. This innovative financing will help Ormat monetize $160 million in tax benefits in 2025, boosting profitability and supporting its long-term energy storage growth strategy. The Zacks Consensus Estimate for the company's 2025 sales implies an improvement of 8.4% from the previous year's estimated figure. The stock boasts a long-term (three-to-five years) earnings growth rate of 10%. The company currently carries a Zacks Rank #2 (Buy). Price & Consensus: ORA Standard Lithium: Based in Vancouver, Canada, Standard Lithium is a technology and lithium development company. Its flagship project is located in southern Arkansas, where it is engaged in the testing and proving of the commercial viability of lithium extraction. On May 29, 2025, it was announced that Smackover Lithium, a joint venture between Standard Lithium and Equinor, has secured AOGC approval for a 2.5% lithium royalty rate for Phase I of its South West Arkansas Project, marking the first such approval in the state. This milestone sets a regulatory precedent and enhances Standard Lithium's pathway to commercial production by 2028. The Zacks Consensus Estimate for SLI's 2025 bottom line is pegged at a loss of 8 cents per share, suggesting a solid improvement from the year-ago quarter's reported loss of 13 cents. The bottom line beat the consensus estimate in the last reported quarter. SLI currently carries a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Price & Consensus: SLI Bloom Energy: Based in San Jose, CA, the company generates and distributes renewable energy. On April 30, 2025, Bloom Energy posted its first-quarter 2025 results. Revenues of $326 million reflected an increase of 38.6% year over year. BE's gross margin was 27.2%, reflecting a 110 basis points improvement over last year's reported figure. The stock holds a long-term earnings growth rate of 24.4%. The Zacks Consensus Estimate for 2025 sales implies an improvement of 19.3% from the previous year's reported figure. The company currently carries a Zacks Rank #3 (Hold). Price & Consensus: BEWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bloom Energy Corporation (BE) : Free Stock Analysis Report Ormat Technologies, Inc. (ORA) : Free Stock Analysis Report Standard Lithium Ltd. (SLI) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Business Recorder
07-05-2025
- Business
- Business Recorder
US natgas output, demand to hit record highs
NEW YORK: US natural gas output and demand will both rise to record highs in 2025, the US Energy Information Administration (EIA) said in its Short-Term Energy Outlook (STEO) on Tuesday. EIA projected dry gas production will rise from 103.2 billion cubic feet per day (bcfd) in 2024 to 104.9 bcfd in 2025 and 106.4 bcfd in 2026. That compares with a record 103.6 bcfd in 2023. The agency also projected domestic gas consumption would rise from a record 90.5 bcfd in 2024 to 91.3 bcfd in 2025 before easing back to 90.7 bcfd in 2026. The May projections for 2025 were lower than EIA's 105.3 bcfd supply forecast in April, but higher than the agency's 91.2 bcfd demand forecast in April. The agency forecast average US liquefied natural gas (LNG) exports would reach 14.6 bcfd in 2025 and 16.0 bcfd in 2026, up from a record 11.9 bcfd in 2024. As renewable sources of power displace coal-fired plants, the agency projected US coal production would fall from 512.1 million short tons in 2024, the lowest since 1964, to 506.4 million tons in 2025, still the lowest since 1964, and 474.9 million tons in 2026, the lowest since 1962. EIA projected carbon dioxide (CO2) emissions from fossil fuels would rise from a four-year low of 4.775 billion metric tons in 2024 to 4.827 billion metric tons in 2025 as oil, coal and gas use increases, before easing to 4.742 billion metric tons in 2026 as oil, coal and gas use declines.
The Independent
13-04-2025
- Business
- The Independent
Coal is not clean, it's not beautiful, and we don't need it for AI
This week, US President Donald Trump issued an executive order aiming to revive 'America's beautiful, clean coal industry' such that it can power the rise in electricity demand from, among other things, artificial intelligence. However, this nostalgic push ignores the reality that has been commonly understood since Dickens: nothing about coal is clean. What it also ignores are reasons behind the industry's twenty-year decline in the US, the incredible uncertainty surrounding what is or might be the future energy demand of AI, and the data centres that give it life. Coal is a dirty business. From the moment you dig it up, often with the help of some of the world's biggest explosive rigs, you release methane gas, which warms the planet over 82 times faster than carbon dioxide over 20 years. Across the Appalachian Mountains in West Virginia and Kentucky, the most popular type of coal mining literally involves blowing the tops of mountains off, covering streams in rock and dirt and filling the nearby valleys in pollutants and heavy metals. When you then try to burn coal to create electricity, you immediately release carbon dioxide, the main driver of climate change. Burning coal currently releases approximately one-fifth of America's total carbon dioxide emissions, along with a host of other air pollutants known to cause asthma and respiratory diseases. Thanks to the Clean Air Act of 1970, originally signed into law by one of Trump's Republican icons, Richard Nixon, the amount of sulphur emissions from coal-fired power plants has significantly reduced from what it once was. This decrease was due to fall even further following the passing of Obama's Clean Air and Water Acts. But these two have already been on Trump's chopping block, as were important updates to protect coal miners from dust inhalation. But the other reality of the coal sector is that it has been in decline since 2008, and coal plants now generate only 15 per cent of America's electricity. Back in 2008, the US produced over a billion short tons of coal each year. By 2023, production had halved, and even with support from President Trump during his term, over 10,000 coal mining jobs were lost during his first term. Today, just over 45,000 people work in US coal mining, a number dwarfed by industries like McDonald's, which employs nearly 150,000 people. But times have changed. Those mines are ageing, productivity is falling, and America's energy landscape has shifted dramatically. Thanks to the shale gas boom, ' natural gas ' (which is just methane) has become the dominant source of US electricity. Meanwhile, the cost of renewables has plummeted, and wind and solar have already overtaken coal in the US power mix — just as they have in Canada, Germany, and the UK. Up until this week, this terminal decline was expected to continue. Ironically, on the same day as President Trump's Executive Order, the US Energy Information Administration released its Short-Term Energy Outlook, projecting that coal production will fall another 9 per cent by 2026. This, they noted, was due to 'coal's continued competition with natural gas and renewables in the electric power sector.' However, while coal has faded from the American energy landscape, a whole new set of power demands seems to be waiting on the very near horizon. Artificial intelligence (AI) and Bitcoin mining are already driving an explosion in data centre electricity consumption in the US, and many analysts are predicting that this could be a critical challenge for America's electricity grid in the near future. One of the biggest challenges is that AI technologies like ChatGPT are estimated to require enormous amounts of computing power to run and train. Early estimates suggested that each AI query might use up to ten times more energy than an average Google search – that's before Gemini took over, at least. If you follow this trend, it makes sense to assume that AI electricity demand could be almost impossible to curtail. In January, President Donald Trump announced his plan for AI dominance, backed by the hopes of more than $US500 billion in investments for an artificial intelligence super-project known as Stargate. While it's incredibly uncertain if this project ever comes to fruition, according to a report from the International Energy Agency this week, electricity consumption for data centres globally could double in the next 5 years alone. In the US, electricity demand for data centres could surpass that of steel, cement, chemicals, and all other energy-intensive industries by 2030. In fact, on a per capita basis, data centres in the US could consume as much electricity per person as it would take to drive an electric car from Los Angeles to New York and back. But these early estimates are riddled with incredible amounts of uncertainty, partly because no one really knows how this industry will play out, and especially, what kind of innovation is lurking just around the corner. And innovation is the norm in this space. As Conal Campbell, Senior Policy Lead at Ireland's EirGrid, noted this week, 'between 2015 and 2022, global internet traffic increased by 600 per cent, but energy used by data centres grew by less than 70 per cent thanks to technological improvements.' While America's tech giants aim to pour billions into maximising the AI industry as quickly as possible, competitors from China and India have already highlighted potential step-change improvements in efficiency. Initial testing from China's DeepSeek indicated that simple queries could be solved with between 50 to 75 per cent less energy than those needed for ChatGPT's solutions, using more advanced and energy-intensive GPUs. To meet this growing energy demand, many tech companies are sounding the electricity demand alarm, crying out for the need to develop new nuclear reactors and now, it seems, even coal-fired power. Microsoft has already teamed up with Constellation Energy to restart a Nuclear reactor at the Three Mile Island nuclear plant in Pennsylvania, and certainly, other companies will make significant investments to secure their own data centre futures. But the line between truth and investor speculation is incredibly hard to see here. Understanding just how world-shifting the AI industry can and will be is one of the most critical questions of our age, and the power sector demands of its growth will play a critical role in shaping the next decade of the world's energy transformation. In some coal-dependent states, coal power may help sure up short-term energy demand growth driven by new data centres, but I can't see how the incredible cost efficiencies of solar and wind can be ignored long-term. Perhaps that's why Trump needed an executive order to bring back the coal sector this week, because the free market and the country's leading energy agency had already signaled its decline. This week's executive order may act as a double espresso for the industry's short-term future, but I can't see that energy high lasting much longer.
Yahoo
12-04-2025
- Business
- Yahoo
US EIA predicts reduced global oil demand from trade tariffs and market uncertainties
The US Energy Information Administration (EIA) anticipates a decline in global oil demand growth through 2026, driven by recent trade policy developments and oil production changes. This forecast is detailed in EIA's April Short-Term Energy Outlook (STEO), which highlights significant uncertainties in energy supply, demand and prices. The STEO, based on current market conditions, notes that early April developments have notably impacted global oil markets. On 2 April, President Donald Trump signed an executive order imposing a minimum 10% tariff on imports from all countries, with higher tariffs on some. In response, China imposed 34% tariffs on US imports on 4 April. Amid these tariff announcements, OPEC+ members declared on 3 April that certain countries would begin increasing oil production in May rather than July, as initially planned. These announcements led to a 12% drop in the Brent crude oil spot price to $68 per barrel (bbl) by 4 April. The EIA's forecasts, completed on 7 April, incorporate some of these recent market changes. However, the agency expects continued volatility as market participants react to further developments. The EIA projects ongoing growth in US and global oil production, with OPEC+ accelerating its previously announced production increases and the US exempting energy from its recent tariffs. The EIA expects global oil inventories to rise starting mid-2025, although market uncertainty could result in lower economic growth and reduced demand for petroleum products than previously forecast. This combination of increasing supply and decreasing demand leads the EIA to predict that the Brent crude oil price will average less than $70/bbl in 2025, dropping to just over $60/bbl in 2026. These prices are approximately 10% lower than the March STEO forecast, reflecting heightened uncertainty around global oil demand growth and potential additional supply from OPEC+ in the coming months. Other uncertainties include existing sanctions on Russia, Iran and Venezuela, which could also impact oil prices. The EIA expects China's retaliatory tariffs on US goods to significantly affect propane as China is a major importer of US propane. While some propane previously exported to China may find new destinations, the EIA predicts reduced export demand will increase propane inventories on the US Gulf Coast, exerting downward pressure on the Mt. Belvieu propane spot price. US natural gas demand is also forecasted to grow by 4% in 2025, averaging just over 115 billion cubic feet per day. This growth is driven by an 18% increase in exports and a 9% rise in residential and commercial consumption for space heating. The increase in natural gas exports is primarily due to the expansion of liquefied natural gas (LNG) exports as new Plaquemines Phase 1 and Golden Pass LNG facilities commence operations. Despite China not currently importing US LNG, the EIA expects global LNG demand and flexible US LNG contract clauses to mitigate the impact of recent trade policy developments on US LNG exports. The EIA continues to forecast higher natural gas prices this year, with the Henry Hub price averaging around $4.30 per million British thermal units (MBtu) in 2025, up $2.10/MBtu from 2024. The agency expects the annual average price to rise to around $4.60/MMBtu in 2026. "US EIA predicts reduced global oil demand from trade tariffs and market uncertainties" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Zawya
11-04-2025
- Business
- Zawya
US natgas output and demand to hit record highs in 2025, EIA says
U.S. natural gas output and demand will both rise to record highs in 2025, the U.S. Energy Information Administration (EIA) said in its Short-Term Energy Outlook (STEO) on Thursday. EIA projected dry gas production will rise from 103.2 billion cubic feet per day (bcfd) in 2024 to 105.3 bcfd in 2025 and 107.1 bcfd in 2026. That compares with a record 103.6 bcfd in 2023. The agency also projected domestic gas consumption would rise from a record 90.5 bcfd in 2024 to 91.2 bcfd in 2025 before easing back to 90.5 bcfd in 2026. The April projections for 2025 were higher than EIA's 105.2 bcfd supply forecast in March, but lower than the agency's 92.0 bcfd demand forecast in March. The agency forecast average U.S. liquefied natural gas (LNG) exports would reach 15.2 bcfd in 2025 and 16.4 bcfd in 2026, up from a record 11.9 bcfd in 2024. As renewable sources of power displace coal-fired plants, the agency projected U.S. coal production would fall from 512.1 million short tons in 2024, the lowest since 1964, to 489.3 million tons in 2025, the lowest since 1963, and 466.0 million tons in 2026, the lowest since 1962. EIA projected carbon dioxide (CO2) emissions from fossil fuels would rise from a four-year low of 4.772 billion metric tons in 2024 to 4.812 billion metric tons in 2025 as coal and gas use increases, before easing to 4.741 billion metric tons in 2026 as coal and gas use declines.
