That was one of the core sentiments expressed by Mark Copley, CEO of the European Federation of Energy Traders (EFET), in a discussion about how Europe’s new gas price cap will impact markets.

Copley stressed that despite Europe’s well-established regulatory framework, price caps and national interventions ultimately make a regulatory framework more risky and that translates into price premiums and decreased willingness to trade and invest in Europe.

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Price caps don’t address the supply problem

Copley explains that the price cap is a newly introduced market correction mechanism that places a cap on the price at which derivative contracts can be bought.

However, according to Copley, the price cap is not a solution to the supply and demand issue which he believes to be the cause of the current energy crisis.

“We warned against the introduction of price caps…because the energy crisis we have experienced over the past year to 18 months was around not having enough gas… or power and our view is very clearly that you need to tackle that by increasing supply or reducing demand.

“If we’re talking about increasing supply in the short term at least you have to make sure that LNG cargos reach Europe.”

Not only do price caps not address the issue of supply, but it also leads to negative consequences that could make the situation worse, says Copley.

Price caps could have negative consequences

Even though it’s too early to say what changes might result in market behaviour, Copley suggests that capping derivative prices could result in the following negative effects:

• Reducing the incentive for gas to flow to Europe and largely making markets other than Europe more attractive.
• Increasing the uncertainty in Europe’s regulatory framework means people are less likely to want to deliver gas to Europe.
• It reduces incentives to reduce demand.

We would expect to see traded volumes moving away from exchanges and towards over-the-counter markets, argues Copley. “People might also start looking to trade in venues outside of Europe, such as the UK, Singapore, or US.”

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Ultimately, there is a chance of a general increase in uncertainty, leading to traders being more risk-averse and deciding to trade less. This will lead to a fall in market liquidity, increasing market volatility and risk.

How safe are the safeguards?

Although attempts have been made to ensure the price cap is only triggered in exceptional circumstances, says Copley, there are some challenges around figuring out when it will be triggered and under what circumstances.

“It’s good that safeguards have been built in, but what we need to realise is that the cap doesn’t need to be triggered to have an effect on market behaviour. What we worry about is its effects of merely existing”.

“If you’re trying to hedge gas transactions long term, you’re thinking about what to buy and how to manage the risks associated with it. If you don’t know if the policy will be triggered, how the policy will be triggered, or in some cases how it will be implemented…all of that translates into an increase in risk and a greater unwillingness to trade.”

The way forward

According to Copley, despite the search for the magic bullet, there simply isn’t one.

In a crisis of short supply, there are however ways to alleviate the problem. He suggests expanding LNG capacity, resolving bottlenecks in the grid, making as much cross-border power available as possible, working with member states on security of supply arrangements and coordinating filling tenders.

Copley suggests that taking more time on policy-making is critical now. It’s time to carefully consider how to remove these temporary interventions and if this is done in consultation with stakeholders, it would be a measure welcomed by the market and would go a long way to rebuilding lost trust.

For more insights from Mark Copley, listen to the Energy Transitions podcast episode:

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The funding round was led by GM Ventures and Barclays Sustainable Impact Capital, with participation from SWEN CP and Siemens Energy Ventures. The investors will also act as strategic partners for GeoPura moving forward.

GeoPura offers an alternative to traditional diesel generators with its hydrogen power unit (HPU) technology used for temporary, supplementary, off-grid and backup power.

The firm generates hydrogen and transports the fuel to customers for use in its HPUs – customers simply rent the units and pay for the fuel used.

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The latest investment will enable mass manufacturing of HPUs and will increase the production of green hydrogen to fuel the units in the North East and throughout the UK.

The company also aims to bring a number of new products to market, addressing smaller and larger power requirements.

GeoPura chief executive Andrew Cunningham said the investment “allows us to build on our installed base of HPUs and hydrogen production infrastructure to stimulate the green hydrogen economy, and then expand the use of clean fuels into other hard-to-decarbonise areas of our energy system”.

“We have secured the right mix of investors, forming strategic partnerships that not only provide the funds to enable us to scale rapidly, but also the skills and resources to accelerate the transition to zero emission fuels.”

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James Ferrier, Director of Principal Investments at Barclays Sustainable Impact Capital, said: “Whilst most of the focus in the UK is rightly on ‘greening’ our energy grid, industries which are reliant on fossil-fuel powered generators – such as construction, film production and events – should not be forgotten.

“Establishing tailored methods of off-grid green energy generation such as GeoPura’s Hydrogen Power Unit technology will be crucial for the decarbonisation of these industries, and we are excited to support GeoPura as they begin to scale.”

Kendra Rauschenberger, General Partner at Siemens Energy Ventures, said she has “worked alongside GeoPura from the early days” and added that “it has been incredible to see the development of this business as more customers turn to utilizing green hydrogen for their sustainable energy needs and commitments”.

GeoPura plans to deploy a fleet of over 3,600 HPUs by 2033 and is currently providing power to Balfour Beatty, HS2, National Grid and the BBC.

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A joint venture created to promote floating offshore windfarms in the Iberian Peninsula has announced its first project for Portugal.

IberBlue Wind has unveiled plans for a 990MW floating offshore windfarm off the coast of Figueira da Foz.

Called Botafogo after a 16^th century galleon that became known as the most powerful warship of its time, the windfarm will occupy an area of 359 km² and will have 55 wind turbines, each with a capacity of 18MW.

Figueira da Foz is one of five areas proposed by the Portuguese government for offshore renewable energy exploration.

IberBlue Wind vice-president Adrián de Andrés explained: “Figueira da Foz is a region with great potential.

“Besides the high wind strengths and the existing port infrastructure, it’s located near to the centre of the country where there is significant demand for energy from both industrial and private consumers”.

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IberBlue Wind says the development of the project will create thousands of jobs, most for development and construction and the rest for the operation and maintenance of turbines once oprational.

The Botafogo windfarm will be built on floating platforms anchored to the seabed allowing it to be located 30-50 km from the coast.

2GW of Iberian Peninsula potential

IberBlue Wind is a joint venture between Irish floating offshore wind company Simply Blue Group and Spanish companies Proes Consultores, the engineering division of Grupo Amper, and renewable energy developer FF New Energy Ventures.

It aims to develop at least 2GW of offshore wind capacity off the Iberian Peninsula using floating windfarms, each comprising 500MW or more.

IberBlue Wind announced a project in Spain last November. Nao Victoria will be in the Alboran Sea, off the coasts of Cadiz and Malaga, on an area of 310 km² and also with an installed capacity of 990MW.

The company says it is working on several other projects for the Iberian Peninsula which it plans to announce soon.

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According to Prysmian, extreme climate events like heavy rains and floods may cause deterioration to solar cables and failure with negative consequences on power generation capacity, reliability of power supplies and return on investment.

Prysmian performed extensive R&D to develop Prysolar with the aim of minimising cable failure due to unpredictable challenges from increasing solar applications.

Prysolar offers significant climate strength and a longer lifetime thanks to what Prysmian hails as a first-in-the-industry test protocol that certifies long term resistance in water for DC cables.

Also, operational efficiency is enhanced by the use of tailored solar string monitoring systems based on proprietary PRY-CAM technology.

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“Solar photovoltaic generation is set to cover more than 50% of the global electricity demand by 2050. Return on investment, asset efficiency, OPEX and Levelized Cost of Energy are the main and most critical priorities for our customers in the solar industry. Prysmian Prysolar, is the new generation of cables designed to provide our solar customers with peace of mind in these areas”, says Vanessa Alvarez, SVP industrial specialties, Prysmian Group

Prysmian will officially launch Prysolar at the Genera 2023 International Energy and Environment Fair taking place in Madrid from February 21 to 23, 2023.

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The Pioneer Centre, a new initiative of the Technical University of Denmark (DTU) and Aalborg University, has launched the CAPeX Academy with the aim to educate around 50 PhD students and 50 postdocs for the power-to-x industry over the centre’s lifetime.

The partners believe that as the power-to-x industry is starting to boom, there is a need for a much larger number of experts in this field than currently and that they will especially need multiple interdisciplinary competences.

Tejs Vegge, professor at DTU and a co-lead of CAPeX, says these are the experts who will carry the research forward as well as the industrial development of the new technologies for power-to-x.

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“If you look at the new materials and green technologies that we’re beginning to be able to develop now, they will need to be increased more than a thousandfold to have a global impact. This means that there must be researchers who can, for example, develop more efficient catalysts as well as people working in the industry who can produce them faster and cheaper than today.”

Frede Blaabjerg, professor at Aalborg University and the second co-lead of CAPeX, adds that it isn’t enough to ‘simply’ design the world’s best catalyst and it’s also necessary to ensure sustainable and scalable production to meet global challenges.

“This requires new ways of thinking, and these are the type of experts we want to help train.”

While The CAPeX centre is based in Denmark, close collaboration is being initiated with international universities, including Stanford in the US, the University of Toronto in Canada and Utrecht University in the Netherlands, which will enable researchers and Academy participants also to obtain access to equipment and expertise in those locations.

Exchanges also are planned both of Danish students externally and vice versa.

Pioneer Centre for power-to-x

The CAPeX was launched by the two universities in December to bring together their expertise and competencies and those of other local universities to develop new materials and technologies for power-to-x.

Currently, the most efficient materials used today to produce hydrogen using electrolysis are based on rare minerals and earths. One of the main challenges for CAPeX is to develop new sustainable catalysts for electrolysis that can be scaled and deployed globally.

The Centre also will focus on sustainable solutions for e.g. heavy transport and aviation.

A key basis of this research will be digital twins which will enable the design, test and analysis of new materials, cells and systems before they are manufactured, making it possible to predict how materials and systems change their properties and behaviour from the atomic level right up to optimising an energy island.

The Centre was established with a has a total grant of DKK300 million (US$43 million) from the Ministry of Higher Education and Science and five Danish foundations.

Other participants in CAPeX are the University of Copenhagen, Aarhus University and the University of Southern Denmark.

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The report was released by the non-profit EngineeringUK and confirms that with the current conversion rate from A-level to undergraduate study, around 150,000 girls would need to study A-levels in maths or physics (or both), in order to reach the same number of male undergraduates.

This is a significant increase of around 115,000 girls compared to current numbers.

The report, which is based on Higher Education Statistics Agency (HESA) data, reveals that 23% of male students who studied A levels in maths or physics, or both, went on to study engineering and technology in higher education however only 8% of female students who took the same subject(s) went on to study engineering and technology degrees.

This translates to a stark gender divide, with only 18% of those studying undergraduate degrees in engineering and technology being female, compared to 57% for all degree subjects combined.

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Of the first-year undergraduates in engineering and technology who had studied both maths and physics at A level, only 22% were female students.

However, when looking at these subjects separately, the figures jump to 50% of female students having taken maths only and 31% physics only.

This highlights the importance of continuing to move away from the preferred prerequisites for these courses being A-levels in both subjects and widening the entry qualifications accepted – in order to address gender imbalances.

Dr Claudia Mollidor, head of research and evaluation at EngineeringUK, said: “The gender disparity within undergraduate degrees in engineering and technology is really concerning.

“Given that A-levels in maths and physics are often a prerequisite for such degrees, we need to do more to make sure these subjects are attractive and accessible to girls at school.

“Particularly given we know girls perform as well as boys, or even outperform them, in these subjects.

“Cultivating this interest and appetite at an early stage will be crucial, so that when it comes to selecting GCSEs and A levels, girls are informed and inspired to choose subjects that will allow them to progress into engineering and tech careers.”

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“It’s clear the UK will struggle to get on top of its acute skills shortage, if it fails to increase the number of women entering into engineering-related careers. The first step to addressing this is to increase girls’ interest and engagement with science and maths at school,” added Mollidor.

More encouragingly, for students with A levels in both maths and physics, engineering and technology is the top higher education study subject of choice.

However, there is still a gender imbalance here with 39% of male students choosing the subject vs 29% of female students.

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The Manhay project, GEL’s third site in Cornwall, is set to begin in late 2023 and will take approximately 3 years to complete.

Once completed it is expected to produce 5MW of electrical energy 24/7 and 20MW of thermal energy.

The Manhay site will be similar in construction to GEL’s United Downs project, featuring two deep wells. The production well will reach a depth of approximately 4,500m to bring hot geothermal fluid to the surface, while the reinjection well, which will be around 3,000m deep, will be used to return cooled fluid underground after it has been used to generate electricity.

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Ryan Law, Managing Director of Geothermal Engineering Ltd, said: “We are delighted to be adding this additional site to our deep geothermal portfolio. The three sites we have received the Planning for will be able to power over 35,000 homes. This is alongside providing heat energy for local homes and businesses and attracting important inward investment that will bring with it the potential for new jobs for the local Cornish communities”.

Based on electricity generation alone, the project is expected to provide a lifetime carbon emissions saving of more than 700,000 tonnes of CO2 compared to an equivalent gas baseline.

Matthew Clayton, managing director at Thrive Renewables, and investor in the United Downs project, said that geothermal energy can transform how we generate electricity and supply sustainable heat all year round and no matter the weather.

“It’s great to see approval of a third project, with each one contributing to the future UK energy mix by helping to stabilise and secure the power coming from other renewable sources such as onshore wind and solar. The UK has only scratched the surface of the challenge of transitioning to renewable heat supply. Tapping into the geothermal heat source is a positive stride forwards,” said Clayton.

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The partners are looking to expand offshore wind to contribute to Spain’s energy target of 3GW of floating offshore wind capacity by 2030.

According to RWE, Spain is an attractive market for offshore wind. The National Marine Spatial Plan indicates a potential capacity of more than 20GW and the deep waters make floating wind ideal technology for the area.

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Sven Utermöhlen, CEO of RWE Offshore Wind GmbH, said: “Floating offshore wind is key to meeting the increasing demand for renewable power in Europe, delivering sustainability solutions, supporting local industries and creating new, future-proof jobs. Together with our partner Ferrovial we are committed to contributing towards Spain’s offshore wind objectives…”

Gonzalo Nieto, CEO of Ferrovial Energy Infrastructure and Mobility said in a statement: “At Ferrovial, we clearly see the growth opportunities that this sector offers, which is why we have decided to partner with another market leader, RWE.”

To date, Ferrovial has submitted expressions of interest for four wind farms in the country with an installed capacity of 1,750MW. The company plans to build these projects off the coast in Lugo, Pontevedra, Gerona and Gran Canaria. All of them would be located between 11 and 30 kilometres from the coast.

RWE’s partnership with Ferrovial in offshore wind builds on a long-established renewables business in Spain, comprising onshore wind capacity of around 490MW, solar capacity of more than 90MWac and more than 150MW under construction.

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Carbon Clean’s technology will capture 70,000 tonnes per year of CO2 from a biomass-fired combined heat and power plant in Örnsköldsvik.

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FlagshipONE will combine the biogenic carbon dioxide with renewable hydrogen to produce 50,000 tonnes per year of eMethanol for use in the shipping industry.

Anders Nordstrøm, COO of Ørsted P2X, said: “FlagshipONE is a milestone project for Ørsted and for the decarbonisation of the maritime industry – and we’re very happy to be working with Carbon Clean, as we embark on the journey to transform global shipping.”

Aniruddha Sharma, chair and CEO of Carbon Clean, said: “The FlagshipONE project not only demonstrates the role carbon capture must play in decarbonising hard-to-abate sectors, such as shipping, but also that the technology is ready and there is absolute confidence in our ability to deliver at scale.

“We speak often about the storage of captured carbon, but this project is a perfect example of utilisation – the ‘U’ in CCUS – and we are thrilled to be working alongside Ørsted to deliver this project.”

The carbon capture plant will be modular and designed for ease of construction. Following off-site testing, modules will be transported and assembled on site in autumn 2024.

FlagshipONE, Ørsted’s first commercial-scale Power-to-X facility, is expected to be operational in 2025.

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Situated in Landkreis Uelzen, Niedersachsen, 100km south-east of Hamburg, the wind farms will have a total capacity of 88MW.

Together, the 3 wind farms will produce enough power to supply electricity to the equivalent of about 90,000 households per year.

GE will supply their 5.5MW turbines with a rotor diameter of 158m and has signed a full service contract for 15 years.

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Two projects, Bankewitz and Müssingen, are expected to be commissioned and operational by the end of 2023 while the third one, Flinten, is scheduled in the first quarter of 2024.

Dr. Hartmut Brösamle, COO at wpd said in a statement: “Our Bankewitz, Müssingen and Flinten wind farms are three further exciting and important projects in the German market for which construction is about to start. We can build on a promising project pipeline with which we will continue to drive forward the expansion of German onshore wind energy.”

Germany’s Renewable Energy Sources Act states that by 2025, 40-45% of electricity consumed in the country must be generated by renewables.

According to the Federal Ministry for Economic Affairs and Climate Action, wind energy is one of the driving forces behind Germany’s expanding renewables. In 2018, onshore and offshore wind energy installations accounted for an installed capacity of 52.5GW and 6.4GW respectively. In total, approximately 110TWh were generated by onshore (90.5TWh) and offshore (19.5TWh) installations.

The share of wind energy in Germany’s gross electricity consumption now stands at 18.6%. According to plans drafted by the Federal Government, offshore wind capacity is to reach 15GW by 2030.

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