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It?s All Over For Coal…Oil & Gas Next

Everlution Newsletter

For Tuesday 20 October 2020 provided by (#letsfindsolutions)

News for green investors and organisations, stock watch & grant opportunities

It?s All Over For Coal?..Oil & Gas Next

Demand for Australian thermal coal has peaked, according to the International Energy Agency (IEA), renewables will deliver 80 per cent of the world’s energy needs in the next few years.

In its annual?report?on the World Energy Outlook, the IEA said demand for oil was likely to rebound but that was not the case for thermal coal. During the COVID-19 pandemic, Australia has been saved by its mineral exports, especially iron ore and coal.

Exports are worth $70 billion and they have doubled in the past decade. But the IEA’s report said the global economic slump caused by the pandemic would cause a fall in demand for energy, with oil and coal the hardest hit. Co-author of the report Tim Gould said while demand for energy was expected to rebound when the pandemic was brought under control, demand for coal was not expected to recover with it.

“Energy demand is set to fall by 5 per cent this year, the largest shock in 70 years,” he said. “Coal is under pressure today from phase-out policies, low natural gas prices and the rise of renewables, and the pandemic has worsened its outlook in many countries around the world.”

The IEA is forecasting that coal’s share in the 2040 energy mix will fall below 20 per cent for the first time since the Industrial Revolution, and demand from Asia will be lower than anticipated and not enough to offset falls elsewhere.

The IEA report indicated that growth in energy supply over the next 10 years would come mainly from natural gas, but that the biggest winners would be renewables. Mr Gould said that was because solar and wind were getting cheaper to install, government policies in many parts of the world were providing additional impetus for development, and investors were backing renewables over coal.

“That combination of falling technology cost, policy support and favourable financing terms is a really formidable value proposition,” he said. Solar power will dominate energy supply, according to the other author of the report, Laura Cozzi. “We are expecting renewables to account for 80 per cent of electricity going forward,” Ms Cozzi said. This means solar, wind will actually overtake coal within the next five years.

“We’re going to see solar breaking records for capacity, going at two digits for 20 years.”

CTI launches October specials month

As climate change events increase in number and ferocity, so does climate change risk for businesses and organisations. To remove or control this risk, organisations need to be equipped with the right practical knowledge.

Carbon Training International (CTI) offers courses that give clear direction to understand how to deal with climate change risk.

CTI courses include Strategic Carbon Management, Carbon Accounting, Applied Energy Efficiency, Reducing Fleet Emissions and Carbon Offsetting.

For all courses commencing in October, CTI is offering a 15% discount.

You can easily enrol in one of CTI?s online webinar courses at Just choose your preferred course and course start date. Extra course dates can be arranged.

The good news: carbon emissions and business costs are linked. The more an organisation reduces its carbon emissions the more it reduces its costs.

Eco-tip for the day ? Calculate your carbon footprint

Your carbon footprint is the amount of greenhouse gases?including carbon dioxide, methane, nitrous oxide, fluorinated gases and others?that you produce as you live your life.

So to reduce it, it helps to know how a carbon footprint is calculated. We will start in the next issue with a series showing you how to work it out for yourself.

Share watch ? Iluka Resources Ltd (ILU:ASX)

Iluka Resources has completed the first phase of its diversification into a rare earths producer in Western Australia. The company has concluded construction and commissioning activities at the Eneabba project, and received the board approval to proceed with the phase two.

The rare earths project contains a stockpile rich in monazite and zircon currently stored in a former mining void. The monazite-zircon concentrate is planned for sale for the third quarter of this year. Iluka will commit to a funding of around $35 million to produce an upgraded monazite feedstock, confirming its gradual entry into the rare earths market.

The company has been hit by the COVID-19 pandemic as it realised a 20 per cent decline in mineral sands sales volumes in the first half of the year. Iluka sold 242,000 tonnes of zircon/rutile/synthetic rutile, as well as lower than expected sales for synthetic rutile during the period.

Company managing director Tom O?Leary, however, said the decline had been less than that experienced in previous periods of market weakness. ?Iluka has recorded a solid first half result given the impact of COVID-19 on zircon and titanium markets and the global economy broadly,? he said. ?Given the volatility experienced throughout the world over recent months, we?re pleased with the earnings and cash position we?ve delivered.?

Iluka is also charging ahead with plans to demerge its royalty business from its mineral sands business. The board of Iluka has approved of the demerger, which will be called Deterra

Royalties, with Iluka increasing the level of shareholding in the company from 15 per cent to 20 per cent as a result of uncertainties posed by COVID-19.

The proposed demerger will carry Iluka?s royalty over the BHP-operated Mining Area C iron ore operation in Western Australia as a key asset. ?We are actively progressing the demerger which we expect to complete in the second half,? O?Leary said. ?This will be an important milestone for the company and result in two high quality businesses.?

The share price for the last 5 years is shown above.

Financial indicators

The VIX fear gauge up by 2.57 points since last Tuesday EST to 28.32.

The Dow Jones Industrial Average down since last Tuesday EST by 642.10 points or 2.35% to ????28,195.42, the STOXX 600 down 5.10 points or 1.68% to 366.60 and the Shanghai Composite index down 31.65 points or 0.94% to 3,328.10.

Gold on 1,887.60. US 10-year Treasury Bonds on 0.781 and oil on 40.40. Cryptos Bitcoin up 400 points since last Tuesday or 4.32% to 11,837.

ASX 200 down 9.60 points or 0.01% since last Tuesday to 6,184.60. The Aussie dollar on 70.42US cents.

Eco Market Spot Prices

LGC $40.75

STC $37.95

ESC $27.25

VEEC $35.25

ACCU $16.20

Sources:?RenewEconomy, demandmanager,? Reuters, SMH, Market Watch, Crikey

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