{"id":227,"date":"2013-01-04T08:00:00","date_gmt":"2013-01-04T13:00:00","guid":{"rendered":"http:\/\/www.l-a-k-e.org\/blog\/2013\/01\/carbon-bubble-solar-and-wind-erode-coal-gas-and-biomass-credit-quality-moodys.html"},"modified":"2018-04-25T10:18:30","modified_gmt":"2018-04-25T14:18:30","slug":"carbon-bubble-solar-and-wind-erode-coal-gas-and-biomass-credit-quality-moodys","status":"publish","type":"post","link":"http:\/\/www.l-a-k-e.org\/blog\/2013\/01\/carbon-bubble-solar-and-wind-erode-coal-gas-and-biomass-credit-quality-moodys.html","title":{"rendered":"Carbon bubble? Solar and wind erode coal, gas, and biomass credit quality —Moody’s"},"content":{"rendered":"

\n
\n<\/a>
\nIn Europe it’s already happening: solar and wind are causing
\nbond-rater Moody’s to warn of downgrades of energy companies
\nthat depend on heat from burning coal, gas, or biomass.
\nMoody’s earlier even warned the Bank of England
\nof a potential carbon bubble developing.
\nIf combustion energy plants are affected like this,
\nthe credit effects will be even bigger on even-more-expensive
\nnuclear plants, which Moody’s called a
\n
\nbet-the-farm risk<\/a> way back in 2009.\n<\/p>\n

\nJames Murray wrote for businessGreen 6 Nov 2012,
\n
\nMoody’s: Renewables boom poses credit risk for coal and gas power plants:
\nCredit ratings agency warns increases in renewable power have had \u2018a
\nprofound negative impact\u2019 on the competitiveness of thermal
\ngeneration companies<\/a>,\n<\/p>\n

\n

\n“Large increases in renewables have had a profound negative impact
\non power prices and the competitiveness of thermal generation
\ncompanies in Europe,” said Scott Phillips, an assistant vice
\npresident and analyst at Moody’s Infrastructure Finance Group, in a
\nstatement.\n<\/p>\n

\n“What were once considered stable companies have seen their business
\nmodels severely disrupted and we expect steadily rising levels of
\nrenewable energy output to further affect European utilities’
\ncreditworthiness.”\n<\/p>\n<\/blockquote>\n

\nAnd not just rising, rising increasingly<\/p>\n


\n
\n<\/a>
\nfast.
\nAs
\n
\nMoore’s Law keeps driving solar prices down,<\/a>
\nsolar
\n
\ndeployments are going to keep going up even faster.<\/a>
\n
\n<\/a>
\nThat means formerly stable companies like Southern Company and Georgia Power
\nare risking the fate of
\n
\nPublic Service Company of New Hampshire<\/a>
\nwhich was bankrupted in 1988 by its bet-the-farm nuclear risk at
\nSeabrook Station, and as Japan’s TEPCO and Germany’s E.ON have recently
\nbeen devastated financially by Fukushima.
\nOr if SO and Georgia Power have insulated themselves against that
\nfinancial fate, the rest of us will have to pay off their bad debts.\n<\/p>\n

\n
\n<\/a>
\nHere’s
\n
\nMoody’s own PR<\/a>
\non their recent report,
\n
\nEuropean Utilities: Wind and Solar Power Will Continue to Erode Thermal Generators’ Credit Quality.<\/a>\n<\/p>\n

\n

\n
\n<\/a>
\nBefore this calendar year, the group referred to as on head of the
\nBank of England Mervyn King to examine whether or not a carbon
\nbubble was producing, whereby highly valued businesses ended up
\nreliant on carbon intense enterprise designs that will not be able
\nto proceed if the globe is to supply profound emission reductions.\n<\/p>\n<\/blockquote>\n

It’s not even just coal, gas, and biomass:
\noil, too, is at risk from solar, through
\n
\nsolar charging stations for electric cars.<\/a>
\nThe carbon bubble has been
\n
\nmeasured by the Carbon Tracker Initiative<\/a>, including in its report that originated the term,
\nUnburnable Carbon: Are the World\u2019s Financial Markets Carrying a Carbon Bubble?<\/a>, November 2011.
\nThe carbon bubble has been
\nwritten up in the Financial Times
\n(Carbon bubble is a real risk for markets<\/a> by
\nJeremy Leggett FT 30 October 2012).
\nThose CTI metrics mostly are related to potential climate change regulations.\n<\/p>\n

\n
\n<\/a>
\nBut even before that,
\n
\nMoore’s Law for solar<\/a> is already abrading the carbon bubble,
\nas Moody’s reports.
\nYour pension fund or hedge fund or your university’s endowment
\nis probably invested in old-style thermal energy companies.
\nYou may still have time
\n
\nto urge them to divest<\/a>
\nbefore the carbon bubble bursts and their (and your) investments
\nbecome worthless.\n<\/p>\n

\nThe nuclear bubble is inflated by the same companies that
\nare puffing hot debt into the carbon bubble.
\nAnd the nuclear bubble is already starting to pop, with even other nuclear
\nutilities criticizing Progress Energy for
\nthe Crystal River reactor being $5 billion
\nin the hole and counting.<\/a>
\nBefore Southern Company’s
\n
\nthree-legged nuclear regulatory-capture<\/a>
\nboondoggle at Plant Vogtle goes even more than a couple $billion
\nover
\n
\nand 15 months late<\/a>;
\nbefore
\nthat fiasco on the Savannah River runs up even bigger bills
\n
\nthat Georgia Power can charge its customers for even if it’s cancelled<\/a>
\nand we the taxpayers will be on the hook for its federal loan guarantees;
\nmaybe now is the time to answer
\n
\nPublic Service Commissioner Doug Everett’s question:<\/a>\n<\/p>\n


\n<\/a><\/p>\n

\n\u201cWhich would you think would be best for the ratepayers of Georgia,
\nstop it now or continue with it?\u201d\n<\/p><\/blockquote>\n

\nDominion Power
\n
\nalready is shutting down its Kewaunee nuke.<\/a>
\nWhy are we building more in Georgia?\n<\/p>\n

\n
\n<\/a>
\n
\nSolar and wind are going to win.<\/a>
\nHow far will we let Southern Company and Georgia Power
\ndrag Georgia behind, when we could be getting on with solar for jobs and energy independence?\n<\/p>\n

\nHere’s how you can
\n
\ntell him and the legislature and others<\/a> what you think the answer is.\n<\/p>\n

\n-jsq<\/p>\n","protected":false},"excerpt":{"rendered":"

In Europe it’s already happening: solar and wind are causing bond-rater Moody’s to warn of downgrades of energy companies that depend on heat from burning coal, gas, or biomass. Moody’s earlier even warned the Bank of England of a potential carbon bubble developing. If combustion energy plants are affected like this, the credit effects will […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[120,216,142,14,17,8,18,2,19,20,104,21,22,23,24,53,36],"tags":[1001,8738,972,8753,8746,1003,315,8704,8707,8701,8708,8699,8709,8702,8710,12,7,8737,8711,8712,1002,999,8713,1000,8714,108,8725,166,6,8716],"class_list":["post-227","post","type-post","status-publish","format-standard","hentry","category-biomass","category-coal","category-cwip","category-economy","category-ga-psc","category-georgia","category-georgia-power","category-government","category-history","category-law","category-nuclear","category-planning","category-politics","category-renewable-energy","category-solar","category-sustainability","category-wind","tag-bankrupt","tag-biomass","tag-carbon-bubble","tag-coal","tag-cwip","tag-divestment","tag-e-on","tag-economy","tag-ga-psc","tag-georgia","tag-georgia-power","tag-government","tag-history","tag-lake","tag-law","tag-lowndes-area-knowledge-exchange","tag-lowndes-county","tag-nuclear","tag-planning","tag-politics","tag-psnh","tag-public-service-company-of-new-hampshire","tag-renewable-energy","tag-seabrook-station","tag-solar","tag-southern-company","tag-sustainability","tag-tepco","tag-valdosta","tag-wind"],"_links":{"self":[{"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/posts\/227","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/comments?post=227"}],"version-history":[{"count":4,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/posts\/227\/revisions"}],"predecessor-version":[{"id":20037,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/posts\/227\/revisions\/20037"}],"wp:attachment":[{"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/media?parent=227"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/categories?post=227"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.l-a-k-e.org\/blog\/wp-json\/wp\/v2\/tags?post=227"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}