Power Up: Australia’s Power Paradox
Power Up is published on Mondays and Thursdays. Think your friend or colleague should know about us? Forward this newsletter to them. They can also subscribe here.
Oct 31 -Andy Home, Senior Metals Columnist
Welcome to Power Up. Today we look at how Australia risks missing out on the renewable energy transition despite having vast resources of the minerals that will be needed to replace fossil fuels.
Also in today’s issue, the implications of drought in the western United States, Chevron’s share price challenge, and why both the clean energy sector and U.S. liquefied natural gas exporters are wary of the U.S. presidential elections.
Power Paradox
Australia should be one of the countries best placed to reap the rewards of the clean energy revolution. The country boasts large resources of key energy transition minerals such as lithium, copper and manganese and has a rich mining history.
But the reality is that the country is struggling to live up to its potential. BHP’s nickel operations in Western Australia, for example, were billed as a future energy metals hub but they are currently mothballed with any restart decision not expected for a couple of years.
One problem is the collapse in pricing for many energy transition metals. This is due both to oversupply, particularly Chinese oversupply, and weaker-than-expected demand. The road to electrification is proving a bumpy ride for global automakers as car buyers opt for hybrid vehicles over pure battery models. The rise of the hybrids has changed the demand dynamics for many battery inputs, not least lithium.
However, another big problem is that Australia doesn’t have enough green energy to produce the metals that will power the green transition. Reuters columnist Clyde Russell attended this week’s International Mining and Resources Conference (IMARC) in Sydney, where the country’s power paradox was the big talking point.
Everyone can see the energy transition potential for Australia but turning vision into reality is proving a formidable challenge.
ESSENTIAL READING
Drought across much of the western United States has caused U.S. hydropower generation to drop to a 23-year low so far in 2024. The sharp reduction in dispatchable clean power has forced suppliers to deploy record volumes of natural gas to balance electricity systems. Reuters columnist Gavin Maguire runs the numbers on hydro’s falling share of the energy mix.
U.S. exporters of liquefied natural gas (LNG) could face new hurdles if Republican Donald Trump wins the presidential election despite the former president’s sympathetic stance on fossil fuels. Curtis Williams in Houston reports on fears that proposed tariffs on China could backfire on domestic LNG producers.
The U.S. election is also causing unease in the new energy sector of the stock market. After bubble-like euphoria in 2021-2022, alternative energy funds have been in retreat ever since. The prospect of a win for Trump, who has promised more investment in conventional fossil fuels, is fuelling worries there may be more trouble ahead for the sector, as Danilo Masoni writes here.
The Panama Canal has seen transit volumes of LNGdrop 65% over the last couple of years as U.S. exporters switched shipments to Europe. The Canal's administrator, Ricaurte Vazquez, gave an exclusive interview to Reuters reporters Marianna Parraga and Elida Moreno, explaining how Panama plans to recover the lost volumes.
Chevron CEO Michael Wirth is under pressure as the oil and gas company’s share price underperforms that of rival Exxon Mobil. Reuters reporters in Houston and London look at the reasons why Wirth has fallen out of favour with Wall Street.
We hope you're enjoying the Power Up newsletter. We'd love to hear your thoughts and feedback. You can reach us at: powerup@thomsonreuters.com.
Editing by Marguerita Choy
Aloqador aktivlar
Eng oxirgi yangiliklar
Javobgarlikdan voz kechish: XM Group korxonalari har biri faqat ijro xizmatlarini koʻrsatadi va onlayn savdo platformamizdan foydalanish huquqini beradi, bu odamga veb-saytda yoki veb-sayt orqali mavjud boʻlgan kontentni koʻrish va/yoki undan foydalanishga ruxsat beradi hamda uni oʻzgartirishga moʻljallanmagan va uni oʻzgartirmaydi yoki kengaytirmaydi. Bunday kirish va foydalanish huquqi doimo quyidagilarga boʻysunadi: (i) Shartlar va qoidalar; (ii) Risklar haqida ogohlantirish; va (iii) Javobgarlikni toʻliq rad etish. Shuning uchun bunday kontent umumiy maʼlumot sifatida taqdim etiladi. Xususan, shuni esda tutingki, bizning onlayn savdo platformamiz mazmuni moliyaviy bozorlarda biror bitimni amalga oshirishga oid maslahat yoki taklif emas. Har qanday moliyaviy bozorda savdo qilish sizning kapitalingiz uchun jiddiy risk darajasini oʻz ichiga oladi.
Onlayn savdo platformamizda chop etilgan barcha materiallar faqat taʼlim/axborot maqsadlari uchun moʻljallangan va unda moliyaviy, investitsiya soligʻi yoki savdo maslahatlari va tavsiyalar; yoki bizning savdo narxlarimizning qaydlari; yoki har qanday moliyaviy vositalar bilan bitim tuzish maslahati yoki taklifi; yoki sizga kerak boʻlmagan moliyaviy reklama aksiyalari hisoblanmaydi
Har qanday uchinchi tomon kontenti, shuningdek XM tomonidan tayyorlangan kontent, masalan: fikrlar, yangiliklar, tadqiqotlar, tahlillar, narxlar va boshqa maʼlumotlar yoki bu veb-saytda joylashgan uchinchi tomon saytlariga havolalar umumiy bozor sharhi sifatida "boricha" taqdim etiladi va investitsiya maslahatini tashkil etmaydi. Har qanday kontent investitsiya tadqiqoti sifatida talqin qilinsa, siz bunday kontentni investitsiya tadqiqotlarining mustaqilligini ragʻbatlantirish uchun moʻljallangan qonun talablariga muvofiq moʻljallanmagan va tayyorlanmaganligini eʼtiborga olishingiz va qabul qilishingiz kerak, shuning uchun unga tegishli qonunlar va qoidalarga muvofiq marketing kommunikatsiyasi sifatida qaraladi. Mustaqil boʻlmagan investitsiya tadqiqoti va yuqoridagi maʼlumotlarga oid risk haqida ogohlantirishimizni oʻqib chiqqaningizga va tushunganingizga ishonch hosil qiling, unga bu yerdan kirish mumkin.
