Latest news with #energySector
WIRED
10 hours ago
- Business
- WIRED
Analysts Say Trump Trade Wars Would Harm the Entire US Energy Sector, From Oil to Solar
I also think the tariff on it is just as important as the uncertainty about not knowing where the end game is and what the tariffs are going to be. So, if you're on the manufacturing side of the renewables business, you're making investment decisions that have very long lives when you're building a manufacturing facility. Having that uncertainty around the investment climate and what the level of tariffs is going to be over the long-term just makes it more challenging to make all of those decisions. During the early part of this year, as this tariff war was starting, I had, like, biweekly calls from this manufacturer in Korea, just exasperated, saying, 'Doesn't the US government know that we're making long lead time decisions, and we need to have some sort of clarity around what the policy environment is going to be, not just for the next four years, but for the next 10 years?' The US is making it very challenging right now to make these types of investment decisions. Is there any US energy industry that benefits from trade tensions? I don't think anybody benefits, per se, from the trade tensions. Everybody, no matter what part of the energy sector you're in, is having to navigate the uncertainty around what the tariff levels are going to be. That said, the overall policy environment has changed to one that is more favorable for natural gas. The fact that we are an exporter of natural gas and have all of the domestic resources that we need makes it less impacted by tariffs than what other sectors are, like renewables. But even for E&P [exploration and production of oil and gas], they utilize steel in that process. There are tariffs on steel. Steel prices have gone up. It has a negative impact on all energy sectors. One part of this report that jumped out to me is you said that the US may be stuck with older technologies, especially when it comes to solar, while the rest of the world advances at a quicker pace. What's the long-term effect of that? Before I answer that question directly, let me just give you some context. We estimate that the cost of building a utility-scale solar project is about $1.15 a watt in the US. The comparable number in China is about 42 cents a watt. It's not surprising that the cost of building a solar facility in China is a lot less than the cost of building a solar facility in the US. What is very surprising when we put this data together is how much less expensive it is to build a solar project in Europe than it is in the US. It's about 70 cents a watt to build a solar facility in Europe compared to the US. So the US is almost 50 percent more expensive to build a solar facility than the cost of building it in Europe. And the biggest reason that it's more expensive here is because of all the tariffs that we have on solar. It's not the only reason, but it's the biggest reason. So we've already kind of penalized solar with the tariffs that we have in place.
Reuters
a day ago
- Business
- Reuters
Canadian oil sands company evacuates workers due to wildfire threat
CALGARY, May 30 (Reuters) - MEG Energy ( opens new tab said on Friday it has evacuated all non-essential workers from its oil sands site in northern Alberta due to wildfires burning in the area. The company said it has not curtailed its oil production.
Bloomberg
3 days ago
- Business
- Bloomberg
Ecopetrol to Push Ahead Colombia Gas Drilling After Shell Exit
Ecopetrol SA plans to continue drilling for natural gas in Colombian Caribbean waters after partner Shell Plc exited three offshore blocks, betting on growing domestic demand and potentially lucrative reserves. Shell said in April it would pull out of the COL-5, Purple Angel and Fuerte Sur blocks as part of a 'strategic' decision, ending its oil and gas exploration in Colombia. Ecopetrol, which jointly operates the areas, will move forward on its own or seek a new partner, according to Rafael Guzman, vice president of hydrocarbons.
Zawya
4 days ago
- Business
- Zawya
Abu Dhabi Department of Energy, Presight, AIQ to enhance AI solutions, digital transformation
ABU DHABI: The Abu Dhabi Department of Energy (DoE) signed a strategic cooperation agreement with Presight and AIQ, focused on equipping the DoE with premier solutions in AI and digital transformation, and on developing a data and AI centre for the emirate's energy sector. The announcement of this agreement occurred at the World Utilities Congress 2025, which is presently underway at ADNEC Centre Abu Dhabi. The signing of the agreement was witnessed by Dr. Abdulla Humaid Al Jarwan, Chairman of the Abu Dhabi Department of Energy. The agreement was signed by Ahmed Mohammed Al Rumaithi, Under-Secretary of the Department of Energy; Dr. Adel Al Sharji, Chief Operating Officer of Presight; and Dr. Adel Bin Subaih, Chief Operating Officer of AIQ. The ceremony was attended by several senior officials, experts, and representatives from the participating entities. In this context, Dr. Abdulla Humaid Al Jarwan, Chairman of the Abu Dhabi Department of Energy (DoE), affirmed that this partnership delivers a distinguished set of innovative solutions based on artificial intelligence technologies, contributing to added value across the sectors of water, electricity, district cooling, and petroleum products. He added that the partnership is built on an advanced AI infrastructure that brings together all the qualified expertise it requires, while providing all the modern tools and technologies necessary to develop exceptional solutions setting it apart from other partnerships in this field. He pointed out that the vast amount of data available in the sector is both rich and valuable, dating back to 1958. This, he explained, enhances the ability to leverage historical data to develop smart and effective solutions that meet the demands of the next phase. Regarding the platform, he described it as a pioneering step toward an integrated energy management future, and a qualitative leap in the use of artificial intelligence and advanced digital modeling to achieve efficiency and sustainability across various energy sources. He added that this advanced platform was developed in collaboration with Presight to serve as a unified command center connecting the electricity and water sectors, enabling highly efficient and reliable energy management across the emirate. Ahmed Mohammed Al Rumaithi, Under-Secretary of the Department of Energy, stated, 'This agreement marks an important strategic juncture in the digital transformation process for the energy sector in the Emirate of Abu Dhabi. By means of this collaboration, we aim to leverage cutting-edge AI solutions to reinforce our capacity for precise and thorough monitoring and analysis of the energy and utilities ecosystem. This, in turn, underpins operational efficiency and facilitates data-informed decision-making.' He stated, 'Collaborating with two foremost companies in Presight and AIQ is a cornerstone for bringing about this significant shift, which demonstrates the DoE's resolve to create a smart, integrated energy system that can navigate future variables and assure the security and efficiency of energy.' He also noted that embracing AI-supported technology is not merely a prospective choice anymore; it has evolved into an essential imperative to match the accelerating demand for energy and to meet strategic objectives in both sustainability and the green economy. He emphasised that this agreement helps in consolidating an efficient collaborative framework that supports the development of a resilient and safe energy sector, which in turn promotes sustainable economic expansion, and solidifies Abu Dhabi's status as a premier regional and global hub for energy sector innovation. Dr. Adel Al Sharji, Chief Operating Officer of Presight, stated, 'This initiative represents a transformative step forward in the digital transformation of Abu Dhabi's energy sector. We are leveraging sophisticated artificial intelligence capacities to establish a new international benchmark for energy management on city-wide and country-wide scales. Beyond improving operational effectiveness, this collaboration will also forge a path to a sustainable, innovative, and AI-driven energy future, mirroring the Abu Dhabi government's vision and its dedication to elevating the Emirate's status as a prominent global player in both the energy and AI industries.' Magzhan Kenesbai, Acting Managing Director of AIQ, remarked, 'This agreement is a substantial accomplishment for AIQ, highlighting the maturity of our solutions and their varied application scenarios. The expansion in scope and application of these solutions by the DoE aligns perfectly with our aspiration to be the foremost provider of agent-based artificial intelligence solutions in diverse energy domains.' Kenesbai added, 'We commend the future-oriented vision of the DoE in its endeavor to strike a thoughtful balance between rising energy demand and the assurance of clean, efficient production. This helps to propel economic growth and is in harmony with the UAE Energy Strategy 2050. It is our conviction that artificial intelligence is a vital instrument for empowering the energy sector to attain this balance in a sustainable and efficient manner for generations to come, and we will maintain our dedication to backing the DoE's ambitious vision to realise this objective.' Under the agreement, the three entities will create a leading AI-driven control center platform, named providing live analytics for the energy and utilities sector in Abu Dhabi. The collaboration further involves the introduction of an "AI Lab-as-a-Service," enabling energy companies in Abu Dhabi to test, confirm, and roll out artificial intelligence solutions within their processes for various application scenarios. Additionally, the agreement covers the establishment of a primary data hub which will consolidate all data under the purview of the DoE and sector companies, serving as a single and trusted source of data. The scope of the agreement covers the development of a global center for data and government-focused AI in the energy sector. This aims to create a comprehensive framework enabling energy companies in Abu Dhabi to manage, retrieve, and share their data in a secure setting, and to utilise tailored AI models for supporting workflows and boosting operational efficiency. Furthermore, the agreement provides for collaboration in the fields of research, development, and skills enhancement. This will be achieved by conducting workshops, training programs, and seminars designed to upskill and enable DoE staff to leverage AI tools in their day-to-day responsibilities. Additionally, it involves offering support for Environmental, Social, and Governance (ESG) commitments through solutions founded on artificial intelligence, which promote sustainability and boost operational effectiveness.
Daily Mail
7 days ago
- Business
- Daily Mail
Flawed system leaves millions paying too much for energy bills, says GABRIEL MCKEOWN
Gabriel McKeown is head of macroeconomics at Sad Rabbit. Inflationary pressures have eased considerably from the peaks reached in late 2022. Yet households across the country continue to grapple with the lingering effects of a prolonged cost-of-living crisis. Prices for essential goods and services remain significantly higher than historical norms. Despite reassurances of an economic recovery on the horizon, many consumers are yet to experience meaningful relief. One of the most notable contributors to these persistent high costs has been the energy sector. Even with a sizeable drop in wholesale natural gas prices, bills are remaining stubbornly high for consumers. Even with a cut to the price cap on the horizon, this represents a delayed response to wholesale prices that fell many months ago. Consumers have been stuck paying elevated rates, and are long overdue a reduction in the cap. This situation has intensified calls for policy intervention and market reform. The paradox of energy pricing The energy market has had a tumultuous few years. Wholesale gas prices plummeted in the spring of 2020, as Covid-19 lockdowns strangled economic activity. They then surged by late 2021 due to supply bottlenecks following the global re-opening. This was further compounded by the Russia-Ukraine conflict, which saw UK and European wholesale gas prices spike to record levels. They briefly rose by ten times from the pandemic lows. Households were largely sheltered from this immediate energy cost jump, thanks to the retail price cap administered by Ofgem, combined with massive government subsidies when that proved insufficient. The price cap had already risen 54 per cent in April 2022 but was set to soar a further 80 per cent in October 2022. This resulted in emergency intervention in the form of the Energy Price Guarantee (EPG). Yet the market is far from static. Despite British families seeing energy costs leap to record highs in 2022, by early 2023, a combination of mild weather, ample gas storage in Europe and reductions in demand brought wholesale prices down sharply. Unfortunately for consumers, the regulated price cap was slow to follow. It wasn't until mid-2023 that the cap fell below the government's EPG level, providing some relief. By Autumn 2023, the cap stood at around £1,568 for a typical household. This still far exceeded the pre-Covid average of below £1,000. Furthermore, as of early 2025, the average bill under the cap remains 52 per cent higher than in the winter of 2021 and 2022. This illustrates how far energy costs have diverged from the baseline. The supplier-consumer divide With Europe enjoying relatively mild weather and benefiting from increased non-Russian supplies, wholesale gas prices were on a clear downward trend at the beginning of this year. Yet households were told to expect higher bills once again. Gas prices had dropped to levels not seen since mid-2021. But to justify this latest rise, Ofgem pointed to a brief wholesale price spike that occurred during the cap's assessment window in February. However, by the time the cap increase was announced, those market prices had already fallen back to previous levels. Yet this earlier spike had now been baked into consumer rates for months to come. Consequently, Ofgem declared that the energy price cap would rise by 6.4 per cent from April. This has resulted in households paying an additional £111 annually, and marked the third consecutive quarterly increase in the cap. This highlights a crucial flaw in the UK pricing system. The price cap is not a real-time reflection of market prices but is instead based on future wholesale prices averaged over the prior period. The aim is for this to smooth volatility in prices. But in this case, suppliers had bought much of the energy for spring 2025 during late 2024 and early 2025 when prices were higher. In effect, household prices right now reflect the wholesale market of several months ago. This leads to a gap between the latest energy prices and the bills facing consumers. The energy regulator confirmed that energy bills will fall by £129 in July. Energy supplier profits The energy supplier sector has undergone a significant transformation during this period. It has shifted from a group of loss-making firms on the brink of collapse in 2021 to an arguably healthier state overall, thanks to consolidation and improved profitability. The UK has ended up with an energy system where the risk of high wholesale prices was largely shifted to taxpayers. This was achieved through significant government subsidies and ongoing elevated bills. However, the rewards of higher prices were reaped primarily by the producers and some well-hedged suppliers. This comes at a time when many households are still grappling with energy costs significantly elevated from pre-crisis levels, resulting in widespread energy debt. More than three million households have now fallen behind on payments, exacerbating the living standard collapse experienced over the past few years. The promise of market reform Combatting these issues was a core policy point during much of the election campaigning last year. Yet Labour, which came to power partly on promises to address the energy crisis, faces growing criticism as high bills persist. The government has started to implement policies aimed at reforming the energy sector, such as establishing GB Energy, a publicly owned entity designed to increase the UK's clean energy capacity. But these measures offer limited immediate relief to households. To truly address the foundational issues facing the sector, it will require far broader policies. There needs to be a reassessment of how consumers fit into the energy sector's business model. Energy suppliers naturally defend their hedging practices as essential for market stability. Purchasing energy through forward contracts is necessary to manage risk in rapidly fluctuating markets. They can claim that this protects both themselves and consumers from unpredictable price swings. However, the past few years have shown that while suppliers are insulated from short-term market volatility, consumers feel the direct and prolonged impact of past wholesale price spikes. Even when consumers seek relief from escalating prices via fixed-rate energy deals, which are increasingly available at prices below the current capped rates, these options do not address the structural problems embedded within the UK's energy pricing model. An uncertain future As long as wholesale and retail prices remain disconnected, structural inequities will persist. Addressing these systemic flaws will require immediate reform of pricing mechanisms. It will also need sustained long-term investments in British energy independence. A particularly important area of potential reform is a reevaluation of geographical differences in standing charges. These have drawn criticism for exacerbating regional household inequality. There is also mounting support for introducing targeted social tariffs. These would provide direct financial relief to vulnerable groups that are most impacted by energy market volatility. Aligning Britain more closely with several European peers. Along with offering a viable short-term solution, while longer-term structural adjustments are implemented. Without such actions, British consumers will continue facing elevated bills despite falling wholesale energy prices. This will leave them to bear the brunt of system-wide inefficiencies that have yet to be meaningfully addressed.
