Jul 2, 2008|
Fried stocks, wind power & more
Stocks deep fried as oil boils over
Indian benchmark indices have declined to their lowest levels since August of last year. Factors like record high crude prices and the spectre of rising inflation are acting as bugbears for the markets.
The spike follows rising concerns of an Israeli attack on Iran. As a matter of fact, Iran is the second-largest oil producer within the OPEC (Organisation of the petroleum Exporting Countries) cartel and any interruptions in its exports could push prices higher levels. And if the OPEC President's remarks are something to go by, a barrel of crude oil can hit US$ 170 in a short span of time. He, however, anticipates these prices to fall towards the end of the year, not expecting a barrel's cost to touch US$ 200 as has been predicted by some commodity analysts in the US.
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As for the global stock markets, while the US markets closed marginally in the positive yesterday, the Asian indices have maintained their losing streak today as well. Stocks in Hong Kong and Japan are down 1.4% and 1% respectively. However, Chinese markets are up 1.6% currently.
Zeroing in on energy efficiency
The meeting of the G-8 (Group of Eight) countries in July this year will have several important agendas. The centre stage will be taken by the discussion on energy efficiency. India itself will be a strong participant in this having initiated a 'climate change' plan weeks before the meet.
The Indian government has pledged to devote more attention to renewable energy, water conservation and preserving natural resources in the country's first-ever climate change plan, but it did not set any concrete goals or pledge to cap harmful emissions. According to the recent World Bank data, India is the fourth-largest emitter of carbon dioxide (the main gas linked to climate change) after the US, China and Russia. On a per person basis, though, Indians emit far less carbon dioxide than people in those countries and European nations.
According to the report, the average Indian generates about one-tenth the amount of carbon dioxide as someone in Japan or Europe, and one-twentieth that of an American. According to the scientists in the West, blistering economic growth and huge populations in India and China mean these countries are contributing more to the growth of emissions than developed countries. But, on a per-person basis, these nations still produce far fewer pollutants and gasses than developed countries. Thus, China and India would argue that this is how their contribution to climate change should be judged.
It may be recalled that in April this year, the US President Bush pledged that his country would halt the growth of greenhouse gas emissions by 2025, without giving any specifics about how that would happen. This was after US had long resisted emission caps and refused to join the Kyoto Protocol on limiting such emissions. On the other hand, China's first climate change plan released last year called for improved energy efficiency and expansion of renewable and nuclear energy sources. But none of the targets were really met.
Also read - As you sowed carbon
Windy times ahead
The International Herald Tribune had recently reported that wind power is gaining advocates in the US, the world's second biggest polluter after China. While only 1% of US electricity comes from wind, it is attracting so much support in that country that many in the industry believe it is poised for growth.
The report goes on to state that 'last year, a record 3,100 turbines were installed across 34 US states, and another 2,000 turbines are now under construction from California to Massachusetts." In all, there are more than 25,000 turbines in operation in the US, set up with an investment of US$ 15 bn. Last week, the US Energy Department has indicated that, by 2030, wind power could provide 20% of US electricity, or 304 gigawatts (GW), up from the current set up of 16.8 GW (a compounded annual rise of 14% in wind power capacity).
Indian wind power equipment suppliers like Suzlon Energy are already charting the path to opportunities in the global markets, including the US, Europe and China. The US is, in fact, one of the company's largest markets and it had set up a manufacturing capacity there in 2006. However, while the opportunity for the company is huge, these come with a set of constraints like that of key equipment supply and logistics. Then, the company had recently faced breakage issues with some of its wind turbines in the US, for which it had to set aside Rs 1 bn as provisions.
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