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I was off last week — when, of course, some of the biggest energy stories of the summer poured in, from Sunrun announcing a bid to acquire rival Vivint Solar to legal snarls for major pipelines.
Before we get to it, one quick note: I'm working on a story about the experience of LGBTIQ workers in the oil and gas industry, including those who are based overseas in countries that out-law same-sex relations. If you know anyone who might be open to chatting with me, please have them reach out at bjones@businessinsider.com.
Even a pandemic can't stop the rise of clean-energy investments
2020 won't be remembered as a year of prosperity. Thousands of energy workers have lost their jobs, and global investment in oil exploration and extraction is set for a 15-year low, according to the consulting firm Rystad Energy.
But: There are some signs of resilience, at least in the clean-energy industry.
- In the first six months of the year, investment in
renewable energy was actually up about 4%, relative to the same period last year. - Investment from VC and private-equity firms rose even more, by about 10%, according to the research firm BloombergNEF (BNEF).
Details: Offshore wind investments are behind the surge, while funding for solar and onshore wind slid.
- In the first six months of the year, total funding for offshore wind was up more than 300%, year-on-year.
- "The first half of this year saw investment decisions made on 28 sea-based wind farms, including the largest ever, the 1.5GW Vattenfall Hollandse Zuid array off the coast of the Netherlands, costing an estimated $3.9 billion," BNEF said.
The key investors: We compiled a list of the top VC and private-equity investors fueling the industry. You can see all of those here.
Mega-merger: Sunrun's CFO told us what's behind the $3.2 billion bid to buy Vivint Solar
Should the deal close, it will be the largest consolidation in the history of the residential solar industry, valued at a whopping $3.2 billion.
- The new solar behemoth will have half a million customers, at least 15% market share, and an enterprise value of $9 billion.
Behind the deal: In a call with us on Thursday,
- Vivint, for example, has almost 200,000 customers, and less than 10% of them have batteries attached to their solar systems, according to analysts at Wood Mackenzie.
- Sunrun is a leader in selling batteries with solar panels. The company will inherit Vivint's customers and gain the opportunity to profit big by upselling them batteries.
- Read the story here.
Bloom Energy is dipping into the booming hydrogen industry. It's already paying off.
If you follow my work, you know I love algae. Hydrogen gas is a close second.
- Fun fact 1: Hydrogen is the most abundant element in the universe.
- Fun fact 2: It was called "flammable gas" in the 18th century. You may recall the Hindenburg — a hydrogen-filled airship that exploded in 1937, killing 36 people.
- Fun fact 3: The gas is a ubiquitous industry feedstock, used in the production of ammonia (used, in turn, to make fertilizer) and steel.
As I detail in this explainer, the hydrogen industry is no stranger to booms and busts. Today, it's booming again — thanks, in part, to cheap renewable energy, which you can use to make hydrogen through electrolysis.
- Bloom Energy is one of the few large and public clean-tech companies that aren't in the solar and wind sectors.
- It makes batterylike fuel cells, typically run with natural gas, that can power buildings. Now the company says it will make cells that run on hydrogen.
- Plus, Bloom is developing electrolyzers that will use renewable electricity to make hydrogen from water — yielding what's called green hydrogen. The vast majority of existing hydrogen gas is derived from fossil fuels.
- The company's stock spiked on the news.
- Read our full story to see what analysts are saying, and what this means for the future of the company.
6 essential updates on the oil industry
- BP continues to grow its renewable energy business. This week, the oil giant announced a partnership with JinkoPower, a top Chinese solar developer, to take on China's commercial and industrial market. We also learned that BP is set to acquire a 100% stake in a large wind farm in Indiana.
- The recovery of oil prices remains stalled. US oil futures were trading at about $40 a barrel on Friday, up less than 3% over the last month. The second wave of the coronavirus pandemic has something to do with it.
- But oil demand could rebound sharply next year. Our markets reporter Ben Winck reports that demand for OPEC-sourced crude oil will recover 25% in 2021 and surpass levels seen in 2019, according to an OPEC report.
- OPEC Plus is set to increase oil output. After a historic deal in April to curb oil production in the wake of the coronavirus pandemic, OPEC and its allies will raise production by 2 million barrels per day starting next month, as stipulated in the April agreement.
- More oil-and-gas companies file for bankruptcy protection. California's biggest oil driller, California Resources, filed for Chapter 11 on Thursday. Just a few days earlier, fracking-sand supplier Hi-Crush also filed.
- The Dakota Access Pipeline can continue operating for now. Earlier this month, a US court ruled that the Dakota Access Pipeline — which carries oil from the Bakken region of North Dakota to a terminal in Illinois — must be shut down and emptied. This week, a federal appellate court temporarily blocked that order.
A few startup updates
- ClassPass co-founder Sanjiv Sanghavi is joining the digital utility Arcadia as the chief product officer. More on that next week.
- Form Energy, a startup focused on developing new, long-lasting battery chemistries, brought on two new high-powered execs with experience at Tesla, Apple, and SunPower.
- Sodium-ion battery startup Natron Energy raised $35 million. It's backed by Chevron and Khosla Ventures, among other funders.
That's it! Have a great weekend.
- Benji
Ps. I spent one of my days off hunting for blue-spotted salamanders among the mosquito-ridden swamp-forests of northern Iowa, along with herpetologist Jeffrey LeClere. We found two! Look at this cutie.