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  • RE Royalties

October News Update - What the RE Royalties Team is Reading

Updated: Dec 19, 2019

Renewable energy is a quickly changing industry, with investments accelerating at an unprecedented speed. Over the past two months, new reports, innovations, and projects have all gone underway, and this blog will highlight the details on some of them below.

A Decade of Renewable Energy Investment Led by Solar, Tops USD 2.5 Trillion

Over the last decade, renewables capacity has gone from 414 GW to about 1,650 GW. Amidst this growth, solar capacity alone was increased by 26 times the 2009 level, demonstrating technological increases leading to lower costs for developers. What has remained unchanged is China’s leading position as the biggest investor in renewables. However, renewable investment has spread across other countries as well, with the U.S., Japan, and Germany trailing behind. For more information, click here for the press release or here for the full report.

Decarbonization: The Race to Net Zero

Morgan Stanley has published a sustainability report that declares an additional $50 trillion of investment and regulation to be necessary in order to “halt climate change”. The report was compiled by a team of contributors from multiple industries like Technology, Commodities, Agriculture, And Utilities.

The Key Findings show CO2 emissions standing at the highest levels in “human history”, with 53.5 GtCo2e p.a. in 2017. Under the current conditions, the situation would continue to worsen and “and the effects of climate change” could lead up to “mass migration of 200 million people”.

In terms of economics, $10-20 trillion could be subtracted from global GDP by 2100. To prevent the above, renewable energy is “the cornerstone of decarbonization”. The report goes on further to describe new technologies that will lead the effort on stopping climate change.

Innovative Technologies

KPS Energy is currently working with “Kite Technology” to produce renewable energy. A kite is programmed to fly in a pre-defined direction and the lifting forces exert against a network of bridles. The tension on the line is connected to a generator, which creates the electricity.

Quartz has developed a method to stack barrels on top of each other when there is an energy surplus. Barrels are then allowed to drop to the ground under gravity while connected to a generator, which produces electricity during times of energy deficits.

Highview Power has developed a method to liquefy air during periods with electricity surplus. That liquified air is then stored in tanks that will eventually be released under high-pressure to create a gas that powers a turbine, creating electricity. Highview Power is currently developing multiple cryogenic energy storage facilities in the UK and building Europe’s largest storage system.

Recent Deals

Japan’s Mitsui sells of 679 MW of solar and wind in Canada. The portfolio was sold to Canadian infrastructure management firm Axium and comprises of 12 plants across Canada with enterprise value of CAD$1.9 billion. The transaction is expected to complete in March 2020, after regulatory approval.

DE Shaw buys 180MW project duo from First Solar in Utah. The projects are expected to come online in the second and fourth quarters of 2020. They would power Facebook’s new Eagle Mountain data centre and will be operated by First Solar Energy Services.

Virginia government signs deal with local utility Dominion Energy for 345 MW of solar and 75 MW of onshore wind energy to power government buildings and facilities. This was a part of Governor Needham’s executive order to target 30% of Virginia’s electricity to be powered by renewable energy sources by 2030.

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