News December/January 2007

The following are summaries of news stories from the December/January 2007 print edition of Environmental Finance magazine

Iberdrola poised to hit jackpot with renewables IPO

Iberdrola is set to float its renewables business at the top of its projected price range – to a mixed reaction from investors.

In early December, as Environmental Finance went to press, the Spanish utility announced that it would price shares in Iberdrola Renovables at €7 each for retail investors in Spain, at the high end of the suggested range of €5.3–7. The offering set aside for retail and institutional investors in Spain – 20% and 15% respectively – has been oversubscribed by 3.2 and 3.3 times respectively. More...  

Carbon credit write-downs hit project developers

Downward revisions to the carbon credit portfolios of London-listed developers Camco and EcoSecurities have driven down their share prices in November. Meanwhile, shares in another developer, AgCert, hit a new low as it faces serious delivery problems for next year.

Both Camco and EcoSecurities announced sizeable reductions to their portfolios of expected credits from Clean Development Mechanism (CDM) projects in the past month. On 6 November, EcoSecurities slashed its expected output by nearly 25%, compared with a September trading update, to 142 million certified emission reductions (CERs). Camco trimmed its portfolio by 15% at the end of October, compared with June figures, to 30.1 million CERs from registered CDM projects. Each CER represents one tonne of carbon dioxide. More...  

New Forests plans Malaysian ‘biodiversity bank’

Buyers and sellers of palm oil are to be offered ‘biodiversity offset’ credits, in an innovative conservation finance scheme to preserve a crucial area of Malaysian rainforest.

Australian forestry investment firm New Forests is marketing some $200 million of credits to palm oil producers and consumers, with the proceeds to be used to create a 34,000 hectare “conservation bank” in the Malua Forest Reserve, in the state of Sabah. More...  

Generation raising private equity fund

Generation Investment Management, the sustainability-orientated asset management company run by Al Gore and former Goldman Sachs executive David Blood, is raising money into a private equity fund. The fund – which will focus on companies offering solutions to the challenge of climate change – is expected to be unveiled early in 2008, and follows the announcement of an alliance between Generation and leading Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers.

Generation – which was established in 2004, to take a long-term approach to investing – has close to $2 billion under management in a portfolio of 30–50 global public companies. However, while the existing fund is able to allocate a small percentage of its assets to private equities, Generation’s investment managers are seeing a large volume of investment opportunities in private companies. More...  

IATA slams EU move on aviation emissions

A decision by the European Parliament for tougher targets and a stricter timetable to include aviation in the EU Emissions Trading Scheme (ETS) has drawn an angry response from the sector – while a recent report shows it is substantially unprepared for emissions caps.

Members of the European Parliament (MEPs) voted in favour of including aviation emissions in the EU ETS on 13 November. MEPs adopted a report by German rapporteur Peter Liese aimed at reducing aviation emissions from that date to 90% of their average in 2004–06 – 10 percentage points lower than the European Commission’s proposal. More...  

EIB mulling ecosystem, biodiversity fund

The European Investment Bank (EIB) is assessing market interest in an ecosystem and biodiversity fund, with hopes of helping to raise money into such a vehicle in 2008.

It would invest in sectors such as environmentally-friendly agriculture, non-timber forest products, sustainable forestry, eco-tourism and fishery – “all sectors with positive major impacts on biodiversity”, said Martin Paulsen, an energy and environment investment officer at the EIB in Luxembourg. More...  

Business backs offset standard

Business groups have launched the second version of a standard designed to boost the credibility of the voluntary carbon market – but a leading environmental group has slammed it as full of loopholes.

The Voluntary Carbon Standard (VCS) has involved a lengthy stakeholder consultation and is the sector’s leading effort to ensure carbon offsets represent genuine reductions of greenhouse gas emissions. The first version of the VCS was launched in March 2006, and is already in use with carbon buyers and traders, and the ‘2007’ version is expected to broaden its appeal. More...  

Costs add latest hurdle for US offshore wind

While beachfront residents in the US continue to fight planned offshore wind farms, cost has emerged as another barrier to getting the country’s first offshore project operating.

Costs have already terminated a project in New York and threaten another off Delaware, proposed by Bluewater Wind. More...  

REC tops Sarasin solar ranking

Bank Sarasin has produced a global ranking of the top solar photovoltaics (PV) firms, placing the Norwegian company REC at the top of the class.

Giving each company marks out of 10 in four catagories – access to raw materials, size, know-how and customer base – REC scored highest with 32.5 points out of a possible 40, partly because of its vertically-integrated structure. “Its original business of polysilicon production makes it particularly attractive at the moment, but its increasing downstream integration makes it ideally positioned,” the report says. More...  

VeraSun buys US BioEnergy as biofuels shake-out advances

In the latest takeover move in the US bioenergy sector, VeraSun Energy is to buy rival ethanol producer US BioEnergy, to form what could be the largest ethanol producer in the US by the end of 2008.

More takeovers are expected as rising feedstock prices and falling biofuel prices, caused by overcapacity, have forced US ethanol and biodiesel producers to stop production and cancel investments. Companies face worse conditions, warned rating agency Moody’s recently. More...  

Australia ratifies Kyoto, sets new targets

Australia’s incoming Labor Prime Minister Kevin Rudd has signed the nation’s Kyoto Protocol ratification papers, following his decisive 24 November election victory. The new Labor government has also pledged to implement emissions trading by 2010, cut greenhouse gas emissions to 60% below 2000 levels by 2050 and source 20% of the nation’s electricity from renewables by 2020.

The government will adopt a medium-term reduction target next year, once the Garnaut Review commissioned by states and territories delivers its draft report outlining the economic impacts of climate change and recommending policy measures. More...

go to Features December/January 2007