Week Recap: NY Wind Cut, Biden vs. Oil, CA Solar Woes, Tesla

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Weekly Daily Standup Top Stories

3 offshore wind projects nixed in New York

Highlights of the Podcast

00:00 – Intro

00:59 – 3 offshore wind projects nixed in New York

03:48 – Biden administration considers scrapping its cutting-edge proposal to slash power plant pollution

06:22 – Oman LNG signs 10-year gas supply agreement with Turkey’s Botas Petroleum

08:44 – Biden’s damaging war against American energy production

10:58 – Rooftop solar panels are flooding California’s grid. That’s a problem.

13:56 – Tesla Investors Brace for Worst Financial Report in 7 Years

16:34 – Reuters Estimates: Russian Oil and Gas Revenue to Double in April

18:05 – Outro

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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Michael Tanner: [00:00:14] What’s going on, everybody? Welcome into a special edition of the Daily Energy News Beat. Stand up here on this gorgeous. Saturday, April 27th, 2024. It’s been a long week. Folks, I appreciate you guys tuning in on this weekend. To give our special Week in review where our team goes ahead and select some of the top headlines. Lots of great stuff this week, folks. I mean, it was absolutely unbelievable. Had some couple solo shows for myself. So if you’re tired of listening to me, I understand not moving forward, but if you need more Tanner or want to hear other things of what you missed this week, tune in. The teams got the lineup set. But just as always, guys, the news and analysis you hear is brought to you by the world’s greatest website, Energy News Beat.Com. Check us out there. I’m going to go ahead and sign off though. Turn it over to the team. We will see you on Monday with our latest episode. Until then folks. [00:00:58][44.1]

Stuart turley: [00:00:59] Three offshore wind projects next in New York. That’s a total of six that were canceled. Michael. Three were rebid out at double the price. So I went to LSU. But is the same amount of money being stolen from the people? I’m just kidding. No. Three went offshore next. And this is kind of funny. The New York heavy blow to the offshore in a major setback for the climate ambitions. These projects would have delivered four gigawatts, the offshore wind amounting the most of the New York’s 2035 goal. It’s all about cost. Given these developments, there’s no final awards will be made or the, the news, blah, blah blah. Kathy Hochul is all upset when. [00:01:47][48.2]

Michael Tanner: [00:01:47] It comes down to is really what happened here was they couldn’t come to the the maker of these turbines decided not to big a turbine. Build a big enough turbine to fit what the you know, the the retrofit, what these offshore wind farms was going to do. So instead, you would have to use smaller turbines, which means more of them, which means more expense. And like everything, when you try something new, wind energy is fairly new. It’s only been around for ten years. We’ve been developing oil and gas for over 100 years now. Things always in the front end cost more. It’s why investing in hardware. I’m a big fan of the, the All In podcast. These guys, we’re talking about this little, apple, this this new company right now that raised $250 million to build a little thin. It’s their version of Google Glass, but it’s on your pin doing a $50 million. They built a product that didn’t work. Why? Investing in hardware costs so much money. So to think that we’re just going to come into this in the first try, get it right, is ridiculous. It applies to anything. So, that’s why you’re seeing all these cost overruns. It’s absolutely insane. [00:02:54][66.5]

Stuart turley: [00:02:55] Well, and what’s going to happen is, the as I’ve talked about with several different other folks on the podcast, the cost overruns have now caught up to them. And you’ve mentioned this before, is that the wind industry is now catching up, that they can’t constantly go get more money, constantly to get more money. And it’s now to a serious point, GE Renova is the spin off that you’re talking about. [00:03:22][26.9]

Michael Tanner: [00:03:23] Okay. Yeah. This and I mean, to give you an idea, this was originally going to supply power to 10 million homes by 2030. Whether or not you believe that number or not I mean that’s a pretty lofty goal. [00:03:32][9.6]

Stuart turley: [00:03:33] It’s extremely lofty, but the part of the problem is that, we won’t have any whale population by then. [00:03:38][4.9]

Michael Tanner: [00:03:39] That’s perfect. [00:03:40][0.2]

Stuart turley: [00:03:41] Yeah. Okay. That make your day. Hey, it’s celebration Earth day. Let’s get rid of the whales. [00:03:45][4.5]

Michael Tanner: [00:03:46] They’re killing the environment. [00:03:47][0.4]

Stuart turley: [00:03:48] That’s right. Biden administration considers scrapping its cutting edge proposal to slash power plant pollution. David Blackman has been all over this, whole topic. Very well. And, Michael, this article actually came from CNN. That’s when I, when I was reading this, I was kind of like going, Even CNN is out there going the, is the scrapping. Its really, really most impactful power plant rules, are important. The EPA is going after them because they’ve got hydrogen buried into the language as well, so that they can use hydrogen along with the coal. And now their lawsuits coming out saying that hydrogen is more polluting than what is, allowed out there. So they’re trying to separate it out a little bit and slow it down. Hydrogen is not as clean as they say it is. So they’re trying to allow a little bit of two year fund room so that they can extend some of the, coal plants out two years, which is actually brilliant. [00:04:59][70.9]

Michael Tanner: [00:04:59] Yeah. I mean, hydrogen is not here yet. It’s hydrogen is not ready to be injected into my car. I’m not sure if I want to be putting hydrogen into my car and turning it into a weapon. That’s just me. Okay. [00:05:11][11.8]

Stuart turley: [00:05:12] Well, the the rule, this whole these rules are all about carbon capture and stemming. And I agree that if you could do carbon cleaning or carbon scrubbing, you could get it down to enough so that it would be less impact on the environment to run a coal plant than to run a wind turbine. Just by doing scrubbing, you don’t have to do the carbon capture. So the EPA is, delay the rulemaking, on the existing plants which have been covered. Here is a quote from O’Boyle. One thing we can all count on is the EPA will be sued by aggressive party under this rule, no matter what. There will be lawsuits. So I have to hand it to the Biden administration for at least stepping back, taking a couple of t holding their their pinky out like their English and going, we’re going to get sued. Let’s at least take a look at a rule. It’s the first time I’ve heard that in years, Michael. I was pretty pleased. [00:06:12][60.2]

Michael Tanner: [00:06:13] I mean, we’ve had scrubbers around for years, though, so the fact that, like, people are resistant to, oh, maybe we shouldn’t try to make them better is is kind of crazy. But you did a great job. [00:06:21][8.0]

Stuart turley: [00:06:22] Oman LNG signs a ten year gas supply agreement with Turkey’s both US petroleum. Michael, this is critical because it dovetails into the previous discussion. And that is with Oman LNG announced Friday. the Turkey’s Botas petroleum will supply Michael 1 million metric tons per year of LNG for ten years. This is huge. This is also a subcontract a way around saying turkey in there is a map that I’m going to, take a look at, and you take a look at Turkey’s key infrastructure pipelines that are now in place. It now has its LNG import facility. You can now get into a lot of areas and get Russian LNG gas through this agreement through Oman. Oman and Russia have agreements. [00:07:21][58.9]

Michael Tanner: [00:07:25] Yeah. No, this is, I mean, LNG is becoming the big leverage point around the world. We’ve seen. This is the latest in a string of LNG agreements that TAA has done. Saudi Arabia has done so. There’s a continuing reliance. And and if here at home we have an export ban, if not and not an export ban, but we have a ban on building new facilities. If the world is going in the opposite direction, if the world is zigging, we’re zagging. And I like that. I love a good zig when you’re when someone else is zagging. But I actually think in this case, the world is right and we’re going wrong. [00:08:01][35.9]

Stuart turley: [00:08:02] It’s going to it’s going to really set the world back. I mean, the U.S. back a hugely I just found this very, all these threads go together because last week we talked about Turkey becoming the, you know, energy. The thread is big because last week we talked about Turkey becoming the natural gas hub. This week this comes out. I mean, it’s all in threaded in with all sudden. Oh wait a minute. It also means that Russia is now it has a better GDP growth than the EU. [00:08:36][34.2]

Michael Tanner: [00:08:37] Yeah very interesting. It’s it. [00:08:39][1.6]

Stuart turley: [00:08:40] Oh my gosh. Welcome to Earth Day. [00:08:41][1.8]

Michael Tanner: [00:08:42] Earth day 2024. [00:08:43][0.5]

Stuart turley: [00:08:44] Biden’s damaging war against American energy production. This one is I got a lot in this article. And it comes down to, a couple of points. This is from the Hill. There is, the bottom couple paragraphs here. Michael, this isn’t just incompetence, although there’s plenty of that. It’s an ideological effort to smother American energy along with the jobs and income it generates. There is a boom in oil production. By waging war against President Biden can make it more resilient. More could make us more reliant on OPEC, Venezuela and Russia and in the eye, years ahead. This is coming up into a lot of different things. The LNG ban that you and I talked about is just absolutely part of this. And it is also in the geopolitical things. Think about the economy. If we could help our own environment by getting rid of coal. Yay. From a standpoint of going to natural gas, well, if we make more natural gas, we can export more and it’s already dirty and better for the environment. [00:09:59][74.9]

Michael Tanner: [00:10:00] Yeah. No, I you’re absolutely right. Again, the the devil’s advocate here is that everyone’s making money right now at $80 oil. Where there’s a lot of activity going on the, you know, and we’re about to cover specifically the diesel prices. Finally, diesel prices have come down to a specific level because I love how the title of the next article implies that low diesel prices are somehow bad, because that means growth isn’t happening. Well, it also means we can transport things a lot farther and for cheaper, and we see lower inflation. So some of this is a little bit of topsy turvy. Yes, we would all love President Trump to get elected, but he’s going to massively lower oil price just by the effect of having his hand on the lever. And that’s going to, you know, these these revenue, all this revenue that we’re making right now may go away. So it’s weird the war on oil actually makes it more valuable. [00:10:57][56.6]

Stuart turley: [00:10:57] Let’s go to rooftop solar panels that are flooding California’s grid. And that’s a problem. This one is Holy smokes Batman as electricity. The subtitle is, is electricity prices go negative. The Golden State is struggling to offload a glut of solar power. Michael the old dreaded. The chart is in this article. And if, Mr. Producer, we could bring this chart. In California, ample solar power floods the grid in the middle of the day, and you can see the duck is alive and well. Duck soup is rolling here. Here’s the problem. The grid upper, known as Casio, later dubbed the effect as the duck or and they have had some serious problems. Homeowners are expecting money back, when it’s been sold this way for all of the rooftop solar. The grid operator now cannot give money back. All the money for these homeowners have a ten year payback in order to make it, available for them. The battery storage is not working. This is an absolute disaster. Here’s a quote from Michelle Davis. These are not insurmountable challenges. The head of global solar at the energy research consulting firm wood in, McKinsey. But they are challenges that a lot of grid, breaker operators have never had to deal with, nor do they have a government agency that understand how to fix it. [00:12:42][104.4]

Michael Tanner: [00:12:44] Yeah, it’s the unintended consequences when your grid cannot handle the supply that it’s taking or it’s not optimized. The take that I mean, you know, this is a second and third order effect that, you know, on the show we talk about coming, but I don’t think the public or the people who are setting the policies even know. [00:13:00][15.5]

Stuart turley: [00:13:01] No. Absolutely not. And, you know, Michael, I absolutely love Solar panel. I love I’m trying to figure it out, you know, that I’ve got, dual generators coming online. For propane. I got hydro from my local hydro. I got solar panels. I love solar panels. I love me building this entire mini grid and Michael Brown, I’m telling you what, though, it’s a nightmare. But then again, I’m using this as the learning curve. I do love the sitting there going. I’m like a little kid looking at that meter going, I get free energy. And I look over at the bill, how much I paid for the solar versus how much my free hydro is. Yeah. [00:13:45][43.8]

Michael Tanner: [00:13:45] No. Very interesting. And of course, this is happening. California can’t. Yeah, it’s that’s obviously, it makes us laugh. [00:13:53][7.4]

Stuart turley: [00:13:53] You gotta love our buddies over there in California. [00:13:55][1.6]

Michael Tanner: [00:13:56] Tesla absolutely getting crushed. First off, you know, Tesla reports biggest revenue slide since 2012 and announces, renewed push for affordable models. So to give you guys, heads up here, Tesla reported about a 9% drop in revenue in the first quarter, their steepest year over year decline since 2012. That corresponds, to about a stock price that’s down more than 40% year over, since the beginning of the year, which absolutely brings their which is absolutely crazy considering where their valuation was to where that is now. I want to go and bring up this, this article, miss Produce, if you don’t mind showing up. Tesla quarterly revenues by segment. You can see all categories. or excuse me, you can see all categories. They’re mainly total automotive revenues. Take a big hit. Services and energy generation plus storage actually stay relatively the same. We saw Tesla’s automotive revenue decline 7 or 13% relative. So you can see there’s a little bit of growth in the services and the energy generation, which is super interesting. Tesla fans not too happy right now. The Tesla went ahead and did it. Shareholder decade volume growth rate maybe notably lower than the growth rate it achieved in 2023, which is interesting on the back of the fact they didn’t already hit their revenue. Now they’re going to say it may possibly possibly be lower. Knows. You know, they also did mention that they’re really looking at, you know, affordable models that quote unquote, new vehicles, including more affordable models, be able to produce, on the same quality manufacturing lines. So, I mean, it’s clear with the in, as we’ve seen with the Chinese EVs that they’ve come into the market and tried to lower that price down. It’s either a race to the bottom on price or a race to the top. And I think Tesla’s being smart and doing both. If I’m going to bet on anybody, it’s Tesla. But I do think there are some rocky. Rocky roads ahead, and it’ll be interesting to see how they go about doing this. As you can see, the quarterly net income, if you scroll down later in the article, we can also just toss that image up here. Tesla quarterly net income hit pretty crazy. In 2024, or in, in first quarter 2024. So if you want to talk about, some of a reversion to the mean, you know, absolutely, absolutely unbelievable revenue came in as I, you know, they it was a 9% drop in revenue. You know, they had about 27.1 billion in revenue, earlier in the year, five in the more in the morning, we saw analysts expecting about a 22.3 billion barrel, billion, a dollar print. So, you know, I mean, what do you expect? Again, I think it’s a race about to be very interesting to see where Tesla goes, but I’m going to bet on anybody. It’s going to be Elon Musk figuring this out. Because he has proved this wrong. Reuters estimates Russian oil and gas revenue to double in April. Top three bullet points here Russia is expected to pocket 14 billion in April from oil and gas. [00:16:45][169.2]

Michael Tanner: [00:16:46] Russia’s oil and gas revenues have slumped by about 23% last year compared to 2022. But Reuters is also estimating that Russian revenues in the oil and gas in 2024 are going to be 30% higher, or 50% higher than 2022, compared to 2023. So absolutely incredible right now. This month, Russia, again, reading from the article, is estimated to, pocket about $14 billion, and that’s about double where it was last year from about $7 billion. You know, it’s pretty interesting. You know, Reuters estimates that, again, that 30% increase between 2023 and 2024, would be kind of record amounts, for Russia. And I give this as stew. If stew was on this, he would say this is again evidence of the sanctions aren’t working. We know that Russian crude is banned by the West, but they’ve been able to find buyers like China, India and now more recently, Russian LNG, which have begun arriving in a bunch of different European ports, has continued to flow. They’ve been able to basically decolonize their economy and continue to sell, clearly sell their product on the open market by making these direct trades. So this is again proof that sanctions don’t necessarily work. And you have to think about the second order effects as we continue to roll this out. [00:16:46][0.0][962.6]

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