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By David Gaffen, Editor, Energy Markets

Hello Power Up readers! The oil markets continue to meander around, but there has been some notable progress on a lot of projects worldwide, from renewables in China, to solar in the Netherlands, as well as a long-delayed pipeline out of West Virginia. Where there has not been progress is in the realm of the oil and gas companies, who aren’t showing the kind of emissions reductions that would satisfy the goals of the Paris Agreement from 2015 on reducing greenhouse gases. Also, Power Up will not publish this coming Monday, so look for it in a week! 

Today’s top headlines:

• Inflation hits royal finances as King Charles turns down heating
• COLUMN: Is the oil market’s glass half full or half empty?
• OPEC withholds media access to Reuters, Bloomberg, WSJ for July event

Oil and gas companies aren’t making a heck of a lot of progress on emissions.

The world’s biggest oil and gas companies aren’t coming close to the goals set by the Paris Agreement in 2015 on emissions reductions, as Shadia Nasralla reports here, citing multinational nonprofit platform CDP. The oil and gas benchmark the company publishes shows they aren’t coming close, with none of the 100 companies assessed set to cut emissions “at a rate sufficient to align with a 1.5°C pathway over the next five years.” So that’s not good.  

They also noted that 81 oil and gas companies with extraction activities do not show any significant reduction in production before 2030 – part of the reason renewables aren’t really making a dent in overall energy production, as Power Up highlighted last week.

There are only three companies investing more than 50% of their budget in low-carbon technologies. In the last year, some of the European majors have pivoted away from loftier goals on reduction emissions and becoming broader energy companies rather than just oil and gas names, underscoring the difficulty of making the world greener. 

China’s installed solar capacity is surging, but big projects are becoming difficult. Data from Muyu Xu.

China’s most ambitious wind and solar projects – known as “mega-bases,” are taking time to be built, per reporting by Andrew Hayley, citing the Global Energy Monitor think tank. Despite being a huge consumer of fossil fuels, China is also the global leader in renewable energy generation capacity and pushing to build even more new wind and solar farms. The giant mega-bases are where progress is slower, GEM said.  

The country has about 750 gigawatts of wind and solar capacity, about one-third of the world total, with plans to hit 1,200 by 2025, several years ahead of schedule. But the big projects, which are meant to be in very remote areas, are taking longer. Just one of four major bases expected to be installed in the desert is under construction, GEM said.  

That’s a wind turbine owned by Siemens Gamesa – a Siemens subsidiary – on Gran Canaria Island, Spain. Borja Suarez/File Photo

Markets erupted last week after Siemens Energy warned of quality problems at about 30% of its onshore fleet, but so far developers of renewable energy projects say they have limited exposure to the wind turbines that are at the center of the issues, as Christoph Seitz reports here, citing a Citi research report.  

The warning from Siemens sent its shares down by more than one-third. However, Citi said that none of the developers they spoke to were experiencing issues with onshore platforms. Those comments come after some other developers including RWE, Iberdrola, and Copenhagen Infrastructure Partners said this week that they had so far not observed any problems with their fleet of Siemens turbines. Siemens withdrew its profit guidance for 2023 due to the problems. 

Those are lengths of pipe back in 2019 waiting to be laid in the ground along the Mountain Valley Pipeline route in Virginia. Charles Mostoller/File Photo

The long-in-the-works Mountain Valley pipeline may finally get finished after the U.S. energy regulator allowed construction of the line to restart, as Reuters reports here. The $6.6 million line has been delayed for several years due to ongoing litigation and was seen as a key project to cross from West Virginia to Virginia to bring gas to the southeast part of the United States.  

The legal limbo is what in part moved Senator Joe Manchin of West Virginia to push for expedited approval; other lines in the area have been cancelled, like the Atlantic Coast pipeline, after running into legal delays and cost overruns. Some analysts have said, however, that the pipeline may run at just around 35% of its 2 billion cubic feet per day (bcfd) capacity because of its connection to the smaller Transcontinental Gas Pipe Line (Transco) system into which Mountain Valley will connect in Virginia.

“I think a lot of people are surprised by the fact that this country, famous for paintings of clouds, is actually now a solar leader.”  

Netherlands Energy Minister Rob Jetten, on the country’s recent growth in renewables 

Exxon Mobil is set to develop more than 6,100 acres in Arkansas with Tetra Technologies to produce lithium, the second such move this year by the oil major, as Ernest Scheyder reports here.

The company has been pushing into developing the EV supply chain as electric vehicles become more popular among consumers while governments try to press for more EV usage. Exxon would be providing about 2,000 acres for the project, while Tetra would bring 4,100 acres.  

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