China electric vehicle manufacturer relies on Government support

I've got a lot of attention before a few days U.S. electric vehicles (EV) sensation Tesla (NASDAQ: TSLA), so it's only fair that I by writing about China's home-made EV superstar BYD-up follow-up (OTC: BYDDF;) HKEx: 1211; Shenzhen: 002594), which recently published quarterly figures, which look quite disappointing. The only things that look like something encouraging in this latest report are the fact that billionaire investor he bought that in 2008 its 10-percent stake in the company to keep Warren Buffett, still, and that BYD is lucrative. But also the gains strong support from Beijing in its programme to promote clean-energy vehicle development.

If I had to describe BYDs recent performances in a single thought, I'd say that pretty good pilot programs set up this company for its EVs but has found it difficult to translate these programs in large companies. In the last three years, BYD has announced a steady sequence of such pilot programs in a variety of markets, from Western Europe, the United States and Latin America, as well as in its home market of China. But with a few rare exceptions, we need to have one of these programs turn you into the major orders that BYD has its EV program long term profitable to make.

Everything, what say we take a closer look of BYDs latest quarterly results, to show its profit largely evaporated in the first three months of the year. The company reported a first quarter net profit of around 12 million Yuan, or just over $2 million, which was 90 per cent compared to the previous year. This is quite a small figure for a company whose Umsatz amounted to nearly 12 billion yuan for the quarter was down a more modest 9 percent.

BYD reported by 98 million Yuan it received Government grants in the quarter which means that it would have almost certainly lost money, without this support. Of course not we can subtract that amount from its total profit directly, but I think it is fair to say that the company help would have reported a loss of 50 million Yuan or more without this Government.

BYD's Hong Kong traded shares fell 2.8 percent before the report came, although some the reason the latest trading session got back on Friday. The stock has over the last year and a half, more than tripling since October 2012 on enthusiasm about the EV program actually collected anything. But I suspect that this latest disappointing result could force investors to recognize the company's electric dreams materialize are not, as hoped, and could a mark the beginning of wider selloff, the stock drop by a third or more in the next few months could see.

BYD is in the difficult position of waiting on the EV business to launch, fruits as its older battery and traditional gas-powered car companies show signs of aging. BYD earlier said it will leave the gas powered car business altogether by 2015 as the future in electric vehicles. The company also announced a major plan a year ago, to raise up to $500 million by issuing new shares in a bid to shore up its cash position.

I mostly excited about BYD everytime wrote it a new EV pilot, as such programs announced, to test the technology before larger orders are a necessary first step for customers. But the fact that we some large orders appropriate means until probably three years later on, that many of these pilot programs were not as smooth as BYD had hoped and maybe the buyer doesn't see how the technology. The not sure bode well for the future of the company, which means that BYD Government support its bottom line for the rest of this year and possibly in 2015 could depend on.

Bottom line: BYD's latest results show his EV sales are not accelerated, as fast as planned and it will support its bottom line depending on Government subsidies for the rest of this year.

This blog was originally released on young's China business blog and was published with permission.

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Solar Decathlon starts despite US Government shutdown

When disappointed some local may be the Solar Decathlon fans it is out that should have been a good year for the event in Washington, D.C.

During budget dispute clouds over the Federal Government and the Capitol loom, throws the bi-annual Department of energy event an own sunshine in Irvine, California.

Decathlon, started in 2002 by Dr. Richard King of the U.S. solar program has University of team designs for solar-powered houses, so spotlight on America's best and brightest minds millions of visitors from around the globe in the last 11 years taken. Competition, DOE site according to should first "Students and the public that money saving opportunities and benefits for the environment through clean energy presents educate about products and design solutions." On the other hand, tries the event, "showing the convenience and affordability of houses, which combine energy-efficient construction and appliances with renewable energy systems now available the public."

Competition. Innovation. Affordability. Our students show us the spirit of team work can do, how we're fighting here in Washington. In this case, the students are better teaching the lesson.

The Solar Decathlon slogan this year - a path to a better future - pointing a much better prospects. In the solar industry, we find that Americans are finding that solar actually is the bright way.

Residential energy costs are an everyday concern. In the United States 115 million homes consume the energy value $266 billion annually. In its new report on solar heating and cool was the solar energy industries Association, that 72 percent of home energy use related room with hot water, space heating and cooling.

The technologies on display in Irvine for the next couple of weeks face front on this issue. Despite the Government shutdown is the Decathlon happy as planned with the opening of the kickoff Thursday events continue. Visitors of the event can students designed and built by features such as an outer walkway shaded by solar cells, solar chimney with a retractable skylight for natural ventilation and light and houses with enough energy left to your car fuel tour.

Houses of the future? How about houses of today. Already solar provides that concrete income investment for homeowners and businesses alike, while educational programs such as the Solar Decathlon treat visitors the world drawing boards today real options and honor of some of the world's best innovators.

Students urged for their best through a global public competition to sunny skies for us all to create: that is a forecast which could win even some cross-party support.

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Wanxiang wins the U.S. Government approval buy battery manufacturer A123

Approval from CFIUS, was the last hurdle that had to be overcome in order to conclude the transaction Wanxiang, as he is known. The Federal Interagency Group, led by the Treasury Department was selling review, after members of Congress allow national security concerns to get a foreign competitor with State protection technology developed.

Wanxiang, the bankruptcy court approval of the acquisition Dec. 11 completed who said in an e-Mail yesterday, pin NI, President of the US unit Wanxiang America Corp., buying won,. Wanxiang America, the A123s purchased automotive, grid, and commercial assets for approximately $256,6 million. A123 and Wanxiang tries to placate Congressional anxiety by excluding the battery manufacturer Government shops out of the deal at Woodridge, Illinois-based Navitas Systems LLC for about 2.25 million $ was sold.
"We are pleased the Government has completed its review and has with us the go-ahead to this transaction complete," NI said in a statement. "The future is bright for A123. It is a company with extraordinary talent and potential and Wanxiang America is committed to its long-term success and the continued existence of their U.S. operations."

Thing itself sunk
The Waltham, Massachusetts-based battery manufacturer bankruptcy in October after a previous agreement with Wanxiang in the midst of Congressional Republicans allow reluctance, sale to a Chinese company sunk has been filed. A123 listed assets of $459,8 million and debt of $376 million status: Aug. 31 in court documents.

"Provided by CFIUS has nothing my opinion after changing the core technology from A123, developed" and related intellectual property "be separated fields of business can along A123s" said representative Bill Huizenga, a Republican who represent Michigan 2nd Congressional District, in an e - sent statement. "American taxpayers not technology, which in turn are used to compete against American companies should be medium", he said, adding that he in the legislation funded "sensitive technologies" for foreign companies in the future to prevent search sales by the taxpayer.
Federal grant

A123, received a federal grant of more than $249,1 million and only $ 132 million $ for two plants in Michigan, instead of a December auction where Wanxiang beat a joint bid by Milwaukee-based Johnson Controls Inc. and Tokyo-based NEC Corp.
"The Department of energy recovery Act grant for A123 was used for the construction of brick and mortar advanced battery production facilities at two sites in Michigan," Bill said Gibbons, a spokesman for the Department in one via e-Mail statement. The funding for research and development of battery technology of the company used were not, he said.

"With the purchase of these assets of the Department of energy request, which includes the equipment and devices that are part of stay paid in Michigan Recovery Act and continue to operate," generating job opportunities for American workers, Gibbons said.
Joint venture

In the context of the purchase, Wanxiang get seat in Hangzhou, China, A123s, plant in China and its stake in a joint venture with Shanghai Automotive Industry Corp., Shanghai advanced traction battery systems co. called cathode powder used in addition to the battery technology in Fisker Automotive Inc. Karma sedan.

Fisker, A123s main customer, said that it was expected the sale of the company's Michigan plant, so it plug production of the $103,000 - sedan could resume in karma.
A123, whose automotive-Geschaft delivers electric car batteries in about a dozen customers, has facilities in Michigan cities of Livonia and Romulus.

The grid business is focused on power generation, transmission and distribution while the commercial Division develops products for industries such as telecommunications, industrial robotics and power tools, according to the court papers. A123 has worked with the Government on portable power solutions, unmanned aerial vehicles, pulsed power weapons, as well as small energy cell for remote devices.
The case is in terms of A123 Systems Inc., 12-12859, U.S. bankruptcy court, district of Delaware (Wilmington).

Copyright 2013 Bloomberg

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Will new UK Government initiative quiet fears about rising energy prices?

It is a turbulent time for Britain's energy industry. Rising energy prices make more persuasive than ever before the argument for solar PV prices, and the stage has clear for a new funding initiative to improve the nation houses been swept. It is called the green business.

The British are not impressed by the big six energy companies pricing. 92% of the people by the eco experts interviewed, said that they are concerned about the rising cost of energy. The remaining 8% high income groups, and they also won't be able to afford energy price increases of more than 30%. In the popular press and the flyers, in a manner not dissimilar to their coverage of corruption in the banking industry have the energy companies 2012 price increases were planned. Clearly you need an alternative and Government hopes that his new initiative provides.

So first of all, what is the Green deal? A green is a loan of up to ?10,000, which you use to improve your home, making it more energy efficient. Independent evaluation to determine what measures your electricity bill will make the most important improvement. Reimbursements are more than 20 years as rates, structured and are connected to the property, not to the individual. So, if you prefer to let the debts behind. Leave a property, which - in theory - is a cosy and has improved energy efficiency is more valuable.

Login your chance for the Green deal are public so impatiently wait? Of course not; 77% have not even heard. This is not so damning news, because the thing in the oven. It took years to coordinate and is expected to be another year full tire; Although the legislation has completed, the marketing has wait to complete training and other information. It is a promising program but still a chick.

What distinguishes the Green deal to past programs is that it be driven from the market. Because Government cannot afford, so a huge program subsidizing that was green deal developed, are fertile ground for companies: the launch is the Green deal, supported only by a starter Fund of ?200 m by the Government. The plan is to improve energy efficiency and to create thousands of jobs at the same time.

Aim is the Green deal to cut carbon emissions by 80% by 2050, to hit Government targets and to end 'Fuel shortage', defined as, if you spend more than 10% of your income on energy costs. An important research known as the Hill report to find lives in fuel shortage, with 2,700 'excess winter deaths' under heating per year - 20% in the United Kingdom more than killed on the streets.

In 2009, not 7.80 million people could afford the cost of energy.

2016 This number is expected to to 8.50 million increased.

Why is so much energy? A Fator is energy inefficiency; the UK has one of the oldest housing stocks in the world and the insulation and double glazing is often not properly installed, or not there at all. Poor heat output waste had money; Energy course of time inefficiency is untenable for all life on a budget.

The most important factor is simply the energy company, which set the prices.

SSE (Scottish and southern energy) has raised prices for at least 8.40 million people by an average of 8.7%. E.on earnings jumped prices for electricity and gas - 18% - 23% in the first six months of the year 2012, which demonstrated their increasing margins, and increase British Gas owner Centrica - 16% compared with the same period. Investment Bank Morgan Stanley predicted that British households are ?200 worse from 2013 onwards, and this is down in no small part to the energy companies.

The Green deal will begin in October. Environmental, social and housing combine agendas, at the time, the plans of the Government, it in the Coalition flagship green to develop policy. Support the ECO - energy are the Green deal company committed - which will replace the outgoing CERT and ESDP programs for insulation and new boilers.

The Green deal is discussed as an ambitious and innovative; Greg Barker, Minister for energy and climate change, calls it a new framework for energy efficiency, which previously been 'the preserve of the big six energy companies'. This new framework should be flexible, provide for more people across the country and provide further improvement measures, as such an initiative in the past.

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Rethink the role of the Government in Cleantech

Another year, another wringing of the hands over tax credits and incentives for clean technology.

Lobbyists and vendors in the U.S. are once again singing the blues, calling for continued and expanding government investments in clean technology. At the same time, political challengers continue their Solyndra hootenanny, raking the current administration for how it spent hundreds of millions of taxpayer dollars.

One can’t help but wonder whether it’s time for a different tune when it comes to government involvement in cleantech.

Perhaps conversations about policy support should be less about giving more taxpayer money to prop up the space, and more about elected officials setting long term market stability and enabling the private sector to deploy capital to assume risk in cleantech.

Why? First, some background…

Down with Incentives

Every time U.S. tax credits for renewable energy development come up for renewal, the cleantech sector cringes at having to once again “play chicken” with whichever administration is incumbent at the time.

The U.S. Production Tax Credit (PTC), which provides a 2.2-cent per kilowatt-hour benefit for the first ten years of a renewable energy facility's operation, was born in 1992. But it’s had a hardscrabble life, clinging to life support after seven one and two-year extensions bestowed alternately by Republican and Democratic Congresses. Neither major American party has been willing to show long term incentive support for renewable energy.

The PTC for incremental hydro, wave and tidal energy, geothermal, MSW, and bioenergy was extended until the end of 2013. But the production tax credit for wind expires at the end of 2012. And that’s got wind lobby groups girding up. In a recent statement, American Wind Energy Association (AWEA) CEO Denise Bode cited a study suggesting Congressional inaction on the PTC “will kill 37,000 American jobs, shutter plants and cancel billions of dollars in private investment.” The same study suggested extending the wind PTC could allow the industry to grow to 100,000 jobs in just four years. Expect this battle to simmer all summer.

The unpredictability around cleantech incentives is taking its toll. “The U.S. is hitting a brick wall with the cessation of benefits,” remarked John Carson, CEO of Alterra Power, on the subject at a recent cleantech investment conference I co-chaired in Toronto. He wasn’t happy, and do you blame him? Nobody likes living hand to mouth. But that’s what happens when you rely on credits and incentives like the PTC or its loved and loathed counterpart in the U.S., the Investment Tax Credit (ITC).

And then there are the cleantech subsidies provided by the American Recovery and Reinvestment Act of 2009 (ARRA), which are now winding down.

If it feels that clean technology vendors and lobbyists are spending an undue amount of energy and resources chasing such subsidies worldwide, they likely are.

Up with Mandates and Standards

Rather than funding and administering subsidies to help the clean and green tech sectors find their footing, a case could be made that governments should focus on passing aggressive policy mandates, standards and codes.

Instead of using taxpayer money to make technology bets, regional and national governments could focus on passing laws, including broad brush stroke ones like the renewable portfolio standards in the U.S. that mandate a certain percentage of power from renewable sources by certain dates, and then step back and let the private sector figure out how to deliver. Or mandate change more granularly—for example, that coal power plants need to meet certain efficiency or emissions standards by certain dates, and, again, let the private sector figure out how. (Ironically, if there were more public support to actually clean up coal power instead of simply disingenuously parroting, beginning in 2008, that “there’s no such thing as clean coal” and throwing up our hands because environmental ads told us “clean coal doesn’t exist today”—and if that translated into political will and a mandate—cleaner coal power could exist today. Yes, there’d be a penalty on the nameplate capacity of plants’ output, but there’d also be billions saved in health care costs. But we digress.)

Taxpayers should take their politicians to task for trying to play venture capitalist, i.e. by investing their money in trying to pick winners (a la Solyndra) in complicated markets. Professional venture capitalists themselves, who focus on their game full-time, barely pick one winner in 10 investments.

Drawbacks of Incentives

How could government grants, loans, tax credits and other subsidies possibly be bad in cleantech? Free money is good, right? Here’s a list of drawbacks to these incentives, some of them not as obvious as others:

They can go away and cause market disruption – to wit, the points earlier in this article.The existence of loans and grants silences critics – Few speak out against pots of free money, because they might want or need to dip into them in the future.Incentives favor only those willing to apply for them – and therefore are often missed by companies working on disruptive, fast-moving tech, or who are focused on taking care of customers’ needs.Criteria are often too narrowly defined – Criteria for incentives often favor certain technology (solar photovoltaic over other solar, or ethanol over other biofuels), and as a result, lock out other legitimate but different approaches.Picking winners means designating losers – Recipients of government grants or loan guarantees get capital and an associated halo of being an anointed company. Those that don’t are comparatively disadvantaged.Not the best track record – Incentives go to companies best staffed to apply for and lobby for them. And those aren’t necessarily the companies that could use the capital the most effectively, e.g. to compete in world markets, or create the most jobs.
What Governments Could and Should Be Doing

In the cleantech research and consulting we do worldwide at Kachan & Co., we’ve come to believe that governments are best focused on activities to create large and sustained markets for clean technology products and services.

Doing so gives assurance to private investors that there will be continued demand for their investments—one of the most important prerequisites to get venture capital, limited partners and other institutional investors to write large checks.

Given that objective, governments should, in our opinion, pursue:

Setting mandates and standards – e.g. the amount of power generated from renewable sources, new targets for fuel efficiency, green building or other dimensions.Improving codes and other regulations – making building codes more stringent could drive energy efficiency, green building and smart grid investment.Building the talent poolStabilizing the economyFostering political stabilityCommitment to infrastructure projects – including water, transportation and grid.Building showcase projects – regions wanting to foster local cleantech can do as Abu Dhabi has done with its Masdar initiative, as Saudi Arabia is now doing with solar, or as China has done with hundreds of green development zones; in doing so, all three of these countries have sent strong signals to large corporations and investors that they view clean technology as strategic.Rolling back so-called perverse government subsidy support today of the fossil fuel industry, including direct and indirect subsidies.
Cities as Test Beds of Policy Innovation

Interestingly, cities are emerging as petri dishes of progressive cleantech policy, and are increasingly where such innovation is taking place.

For instance, Barcelona has established that large companies need to create as much as 30% of their power from solar thermal technologies. The city of Berkeley, California pioneered what is now known as Property Assessed Clean Energy (PACE) financing, wherein property owners are able to pay for energy efficiency and renewable energy improvements on their property taxes. This month, Phoenix, Arizona introduced what it calls the largest city-sponsored residential solar financing program in the U.S. And New York City is taking the lead in residential demand response by trialing a program to curtail the consumption of 10,000 room air conditioners at times of high demand.

Given the world’s current financial malaise, and especially in light the Occupy momentum globally, I’m surprised more folks aren’t questioning how their governments spend their money in cleantech. Because, as described above, there are other arguably more effective ways elected officials can help usher in a cleaner, greener future than throwing around billions in incentives.

After all, how much fun would a pristine planet be if we’re all destitute because governments have crumbled under crushing debt?

This article was originally published here. Reposted by permission.

A former managing director of the Cleantech Group, Dallas Kachan is now managing partner of Kachan & Co., a cleantech research and advisory firm that does business worldwide from San Francisco, Toronto and Vancouver. The company publishes research on clean technology companies and future trends, offers consulting services to large corporations, governments and cleantech vendors, and connects cleantech companies with investors through its Hello Cleantech™ programs. Kachan staff have been covering, publishing about and helping propel clean technology since 2006. Details at www.kachan.com. Dallas is also executive director of the Clean Mining Alliance.

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Federal Government approves first deep-sea drilling approval in the Gulf

After more than eight months no deep drilling in the Gulf of Mexico has approved the United States the first approval for deep sea drilling in the region.

The Bureau of ocean energy management, regulation and enforcement on Monday announced that noble Energy Inc. is a permission, well, about 70 miles southeast of Venice, La. continue to work was issued

Noble began drilling well four days before the deepwater horizon well exploded. Drilling activity was exposed on 12 June under a moratorium to the United States on the research in waters deeper than 500 feet placed. If the moratorium was lifted in October allowed many thought it would be not long before it would be business as usual in the Gulf, but not new, were issued. 37 Other drilling permits has approved the United States since the lifting of the moratorium, but they were all in shallow water.

Feeling increased pressure from the oil industry began regulators and legislators alike began while drilling projects get back in the Gulf so that new safeguards were available.

Noble received approval to demonstrate it is according to Director Michael Bromwich, which contain a well blowout. The company commissioned the Helix well use containment group, an emergency cover areas, to stop the flow of oil if it loses power over a good stack.

A consortium led by Exxon Mobil Corp. offers an other emergency containment solution, as announced this month.

"We expect more deep-sea allows be approved, in the coming weeks and months based on the same process, which led to the approval of this permission", Bromwich said.

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Government works with push price of solar

SANTA BARBARA much like the Moonshot years 50 ago, that Government to the heavens, a generation of scientists and innovators to reach his next big challenge America help inspire turns.

This time it's just the Sun, not the Moon, is the object of desire. And instead of the space, the focus is better find ways to power the Earth by the power of the Sun.

The SunShot initiative is a challenge, of the Department of energy, solar energy, which in turn would help decrease by $1 per watt, drive the economy, reduce dependence on foreign oil and reduce the amount of climate-damaging gases in the atmosphere spew.

Noble aims it, but a worthy one, Ramamoorthy Ramesh, the DOE Director of solar energy technologies a room full of scientists and energy experts said Tuesday at the Summit of Santa Barbara on energy efficiency.

"It's like all experiment," he said. "What we do, is to set up a hypothesis and then you go back and do the experiment, and you see what the result."

The two-day Conference Wednesday at the four seasons Biltmore Resort, being surfaces look at the challenges and targets for the transition from the United States in the direction of a major renewable energy portfolio of the use of energy more efficient. The event was of the UC Santa Barbara's Institute for energy efficiency to put.

The SunShot initiative is part of making President Obama drive, 80 percent of the country come from clean sources of energy by 2035. A Watt now costs from $3 to $4 for large systems and industry experts say $2.20 per watt is feasible period of five years. This is about 10 cents per kilowatt hour, the standard measurement for utility bills.

Said Bill Brinkman, Director of the Office of science in the DOE technology the hold-up on the strengthening of the role solar is not in the country.

"The problem is we all know how it to do, but it's too expensive", he said. While the price of solar energy by approximately 50 percent has fallen in recent years, it is depending on affordable made by a number of subsidies for private and commercial customers.

As the price has fallen, it has a huge increase in the number of photovoltaic panels on the roofs throughout the country. In 2010, it more than 10 times the amount of energy produced by solar as in the year 2005 did pass a growth rate expected to that.

We want to the point where you need not subsidies. Ramamoorthy Ramesh

"To put it simply, business is booming," said Ryne Raffaelle, Director of the national renewable energy laboratory. "The growth is really phenomenal."

But for his true reach Ramesh said potential, it must be with gas, coal and oil, can compete.

"We want to the point where you need not subsidies," he said. "It is a challenge, but it is feasible."

Solar focuses on places such as California now, where the Sun is abundant. But if the cost is $1 per watt were, it would be reasonable economic everywhere in the country.

The SunShot program is four challenges to drive the price of solar power help: promoting the technology of solar cells, electronics, the installations, improving the efficiency of solar production and reduce the cost of permitting better optimize and design.

Technology provides the innovation required, to drive part of the costs down, but policy makers need to consider such as the cost of licensing and controls to reduce during the installation.

Asked whether the country has the enthusiasm to get that did it with putting a man on the Moon, behind the solar panels in the same way, Ramesh was enthusiastic about the possibilities.

"The same feeling of patriotism, we put a man on the moon to the what is needed," he said. "Confluence of job creation and competitive on the green energy, the sexy, not should be get global market and the priority of the creation?"

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