Ontario had ample opportunity to learn from past experience and its Renewable Energy Subsidy Policy is on the whole quite good.However one part of the FIT program which gave a very generous 80.2c/KwH to micro installations of solar projects under 10 KW was faulty.It led to 160 MW of project applications which were ground mounted with very high production as they used trackers.There was no discrimination between roof and ground mounted micro installations leading to this problem.Note its not possible to install trackers on roofs which can increase the energy by 30-35%.The large number of applications were not factored in by the Ontario Power Authority (OPA) which proposed to retroactively cut those tariffs by 27% for ground plants.
Now Blackstone has decided to gamble on India’s Power Deficit Story by investing $300 million for an undisclosed stake in the company.With investment plans of $6.5 billion and parent company sinking under loads of debt,Moser Baer Projects desperately needed equity which has been provided by Blackstone.Its previous track record in Solar and Optical Media does not inspire a lot of confidence.But India’s 8-9% Growth Rate is like a Rising Tide which will lift all sorts of Boats.Blackstone is perhaps gambling more on that rather than on Moser Baer.
Carbon Capture and Storage (CCS) Technology is akin to putting Lipstick on a Pig (read Coal Power Plants).This Technology which has been hyped as the Green Answer to Coal’s Dirty Polluting Ways has never been proven on a commercial scale .Note the British Government promising CCS with every new Coal Plant.Despite numerous large pilot projects,the Technology remains immature.Even China which gets 80% of its electricity from Coal Power Plants and is the biggest emitter of GHGs,remains skeptical of this technology.
But with the imminent visit of President Obama to India,the government wants to put the final touch to the deal during November.The government has raised the cap Three Fold to $330 million in order to win the support of the main opposition party the BJP.However Greenpeace the international Green NGO has opposed the cap.The reason is there should not a be cap as it increases the moral hazard of the companies.With a cap on their liability,their is an incentive for the private players to loosen their safety standards.There is no cap on liability for any other type of industrial hazard so a nuclear cap also does not make much sense .The recent BP Oil Spill is estimated to cost BP around $20-30 billion despite the Disaster being of lesser magnitude than a Nuclear Accident like Chernyboyl.
The ETF does not make much sense for any class of investor.A Lithium investor would be better off investing in Rockwood,SQM and FMC with appropriate offsetting positions in the agri and speciality chemicals sector.A Battery Investor should invest in BYD,A123 Systems,Ener1 etc. rather than Sanyo,Exide and Cosco.Also a lot of the companies in the ETF have never made profits and are high risk in nature while stable holdings like Rockwood,SQM are expensively valued at the moment.I would advise against investing in this pseudo Green ETF which is only masquerading as a Lithium ETF.
.Now a Central Government Panel has indicted both the state government and Vedanta of environmental abuses in its earlier projects.The N.C. Saxena panel has found the state government officials guilty of violating Forest Rights Act in order to help Vedanta.While rejected Vedanta’s Bauxite Mining Rights,the Panel has found the company guilty of mining on government land,violating environmental laws and tribal rights