World Energy Outlook 2020

0 31

Your free daily email from Fuller Treacy Money

Comments of the Day

13 November 2020

 

Video commentary for November 12th 2020

Eoin Treacy’s view

A link to today’s video commentary is posted in the Subscriber’s Area. 

Some of the topics discussed include: governance is everything, Asia-led recovery spiurring demand for commodities, stock markets quiet, gold and oil stable, 

 

Email of the day – on Asia ex-China

With your comments yesterday on the video commentary about investing in China, I would appreciate some assistance. Bearing in mind your comments, and David’s mantra that “Governance is everything”, I do have some concerns about my investments in China. They are all through ITs (such as Aberdeen Asian Income and Schroder Oriental Income) but all have high exposure to China + Hong Kong (16% and 30% for those 2 ITs). Do you know of any income funds that invest in Asia excluding China? Many thanks for your continuing excellent service.

 

Eoin Treacy’s view

Thank you for this question which gets to the root of many of the conflicting arguments around monetary policy, growth prospects and geopolitics. Interest rates have been risible in Europe, Japan and North America or more than a decade. That promoted growth opportunities over value and in the process compressed yields. Hong Kong and the wider Chinese market offer some of the most attractive income opportunities globally and are not easily replicable.

 

World Energy Outlook 2020

This summary report from the IEA may be of interest to subscribers. Here is a section:

Renewables grow rapidly in all our scenarios, with solar at the centre of this new constellation of electricity generation technologies. Supportive policies and maturing technologies are enabling very cheap access to capital in leading markets. With sharp cost reductions over the past decade, solar PV is consistently cheaper than new coal- or gasfired power plants in most countries, and solar projects now offer some of the lowest cost electricity ever seen. In the STEPS, renewables meet 80% of the growth in global electricity demand to 2030. Hydropower remains the largest renewable source of electricity, but solar is the main driver of growth as it sets new records for deployment each year after 2022, followed by onshore and offshore wind. The advance of renewable sources of generation, and of solar in particular, as well as the contribution of nuclear power, is much stronger in the SDS and NZE2050. The pace of change in the electricity sector puts an additional premium on robust grids and other sources of flexibility, as well as reliable supplies of the critical minerals and metals that are vital to its secure transformation. Storage plays an increasingly vital role in ensuring the flexible operation of power systems, with India becoming the largest market for utility-scale battery storage.

…but the downturn creates risks for the backbone of today’s power systems
Electricity grids could prove to be the weak link in the transformation of the power sector, with implications for the reliability and security of electricity supply. The projected requirement for new transmission and distribution lines worldwide in the STEPS is 80% greater over the next decade than the expansion seen over the last ten years. The importance of electricity networks rises even more in faster energy transitions. However, the financial health of many utilities, especially in developing economies, has worsened as a result of the crisis. There is a disparity in many countries between the spending required for smart, digital and flexible electricity networks and the revenues available to grid operators, creating a risk to the adequacy of investment under today’s regulatory structures.

 

Eoin Treacy’s view

The electrical grid was never designed to tackle the needs of the transportation sector. Not only do supercharging networks demand much greater loads but getting electricity to where it is needed requires a lot of infrastructure. The planning process is the primary obstacle to putting in more power lines or running high volatile cables. It is arguable whether green arguments can quickly overcome NIMBY concerns.

 

Covid Hot Spots Show Signs Europe’s New Wave May Be Cresting

This article by Thomas Mulier and Chris Reiter for Bloomberg may be of interest to subscribers. Here is a section:

The encouraging signs are emerging after many European countries enacted new restrictions, including closing non-essential shops, bars and restaurants, in an effort to slow the pandemic. Ireland, one of the first to reimpose curbs, cut the number of new infections to about 360 in the latest 24 hours from more than 1,200 a day in mid-October.

Progress is mixed, with some countries still seeing big increases. Austria reported a record 9,262 new cases in the past 24 hours on Thursday. The government will meet on Friday to discuss whether further restrictions are needed after a second lockdown began earlier this month.

German Health Minister Jens Spahn said the new numbers in his country are encouraging but that it’s too early to speak of a new trend. The effect of the new measures can’t be evaluated yet, a spokeswoman said. Hospitals are still straining under the backlog of patients with existing infections.

 

Eoin Treacy’s view

Europe is going to be open by Christmas for exactly the same reason it was open for summer. Businesses can’t miss their peak season. It’s what makes or breaks a year in the normal course of events so one way or other figures will be massaged enough to ensure business open up in early December.

 

Eoin’s personal portfolio – new trading position opened October 21st

Eoin Treacy’s view

One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change.

 

This is your daily comment from www.fullertreacymoney.com.
Subscribe to Fuller Treacy Money Limited for exclusive content and audio: Click here for details.

 

The information provided on this website (www.fullertreacymoney.com) is for the purposes of information only. This website and its content is not and should not be considered or deemed to be an offer of or invitation to engage in any investment activity. Nothing Fuller Treacy Money does and nothing on this website is intended to operate or be construed as the giving of advice or the making of a recommendation by Fuller Treacy Money to any investor or prospective investor. Fuller Treacy Money and any other group or associated company of it is not authorised or regulated by the Financial Conduct Authority in the UK or any other regulatory body in any other jurisdiction. By means of your login to our service you are deemed to thereby accept our current Terms of Business including this notice, Except for permission to download a single copy for personal use, the research published by Fuller Treacy Money may not be reproduced, distributed or published in whole or in part by any recipient for any purpose, without the prior express consent of Fuller Treacy Money. Information featured on the website is based upon information and data provided by Fuller Treacy Money and remains the intellectual property of Fuller Treacy Money. Some of the information may also be provided by third parties and whilst Fuller Treacy Money will seek to ensure that information featured the website is updated on a regular basis, Fuller Treacy Money does not accept any responsibility for, and disclaims any and all liability for, any such information (including the accuracy of such information) or views or opinions expressed on the website. Any person considering an investment opportunity as a result of data presented on the website should give full regard to all the content of the website, and should perform their own due diligence and obtain advice from suitably qualified professional advisers before investing. Prospective investors are also encouraged and recommended to take their own independent legal and taxation advice together with any other advice that they may consider necessary to consider the benefits and risks attached to any investment opportunity. No representation or warranty, expressed or implied, is or will be made or given by Fuller Treacy Money (including its executives, employees, agents, contractors and advisors) in relation to the accuracy or completeness of the contents of the website, save that any such liability is not excluded in respect of fraudulent misrepresentation.

Leave A Reply

Your email address will not be published.