Tag Archives: LNG

Cheap Energy to the Rescue: March Issue of TerraJoule.us

Slide1Each issue of TerraJoule.us contains: a Main Essay, the Model Portfolio, the Data Brief, and a link to a Downloadable Podcast. Gregor Macdonald, Editor.

Readers may purchase each issue individually, through Ganxy.com: Purchase.

Or, readers may also take a 12 month subscription through Gumroad.com: TerraJoule.us Monthly eBook  Annual Subscription.

Podcast: This month’s podcast is open to the public. To listen, head over to SoundCloud.

Model Portfolio: The TerraJoule.us model portfolio is down -9.95% since inception and is up +4.80% in 2015. There are no changes to the model portfolio this month.

From this month’s issue:

The magnitude of China’s slowdown has become rather pronounced, and is best observed in the progress of its electricity generation. For much of the last decade, China’s annual growth in electricity generation ran in the double digits—sometimes as high as 12% per annum. For the period 2004-2014, however, that average growth rate has now fallen to 9.44%, as slower years following 2010 have pulled the average downward. TerraJoule.us has been able to source China’s data through October of 2014, and annualizing those figures indicates that China’s power generation growth has fallen to just 4.2% in 2014, compared to the prior year. There are a couple of ways to think about this trend. First, the more general weakness in global demand is reflected in China’s weaker manufacturing sector. Second, this is precisely the slow growth that makes it possible for renewables to gain market share, as coal lags. And finally, the world economy simply awaits China’s next advance in energy consumption. While many think this is a secular slowdown, the example of the US after its heavy industrial phase is instructive. The US consumer economy actually drove energy demand for many decades, after 1960, which saw demand nearly double over the following 40 years. There remains significant upside risk, therefore, in China’s energy demand over the next next several decades.  |  see: China Electricity Generation in TWh 2004-2014.

“TerraJoule.us eBook – Cheap Energy to the Rescue – March 2015” by Gregor Macdonald – Editor on Ganxy

Investing for Energy Transition: November Issue of TerraJoule.us

Each issue of TerraJoule.us contains: a Main Essay, the Model Portfolio, the Data Brief, and a link to a Downloadable Podcast. Gregor Macdonald, Editor.

Readers may purchase each issue individually, through Ganxy.com: Purchase.

Or, readers may also take a 12 month subscription through Gumroad.com: TerraJoule.us Monthly eBook  Annual Subscription.

Podcast: Please enjoy this month’s podcast for free, at SoundCloud: TerraJoule.us November podcast.

From this month’s issue:

No country better illustrates the three phases of energy transition than the United States, which was damaged initially by the energy shock, then struggled and stagnated for five years, and is now starting recover. An excellent way to measure this story has been to follow energy expenditures, which rose sharply on oil’s initial repricing, crashed during the crisis, rose again during the early part of the recovery, and are now falling.  | see: US Annual Energy Expenditures as a Percent of GDP 2004-2014. The United States has been busily constructing new wind and solar capacity, and taking advantage of its very cheap and plentiful supply of natural gas. All the while, Americans have been dumping their demand for oil—which remains expensive despite the recent seasonal decline from $100 to $80. Accordingly, energy expenditures as a percent of GDP are in a four year downtrend, and at 8% are back to levels last seen in 2005. A reminder: upfront costs for the deployment of wind and solar can be high, but the ROI starts immediately and actually increases as time moves forward. The US is now vying with China to be the biggest world mover in the buildout of wind+solar. This pathway will pay increasing dividends as time progresses. We should expect the downtrend in energy expenditures to continue, with gains distributed to the US economy in the form of wealth and GDP.

US Annual Energy Expenditures as a Percent of GDP 2004-2014

Also in this month’s issue:

The model portfolio as of 31 October 2014 is down – 4.26% since the inception date,  April 1, 2013. The portfolio remains fully invested. There are no changes this month to the portfolio’s composition. 

“TerraJoule.us eBook – Investing for Energy Transition – November 2014” by Gregor Macdonald – Editor on Ganxy

Oil’s Ultimate Fate: May Issue of TerraJoule.us

TerraJoule Cover Image May 2013Each issue of TerraJoule.us contains: a Main Essay, a Model Portfolio, a Data Brief, and a link to a Downloadable Podcast. Gregor Macdonald, Editor.

Readers may purchase each issue individually, through Ganxy.com: Purchase.

Or, readers may also take a 12 month subscription through Gumroad.com: Annual Subscription.

This month’s publication, Oil’s Ultimate Fate, covers the structural shift as oil consumption continues to migrate from the West to the developing world. As this trend nears completion, oil will finally be ready for its next, major repricing: 

Oil’s quiet period has been composed of declining OECD demand, a hardening of the floor of oil prices, increased supplies of high-cost, marginal oil, and the almost silent shift of demand from West to East. Non-OECD economic growth, however, has not quite been strong enough to cause oil prices to breakout to the upside. Indeed, weak OECD economies and oil demand have provided just enough counterweight to keep oil prices from taking off. Oil’s quiet period, therefore, has seen oil trapped in a very tight range, unable to move lower because of marginal costs—and—unable to move higher because of continuing affordability issues in the OECD.

The May issue also includes an analysis of Japan’s worsening energy-balances, as the country’s currency debasement strategy meets up with soaring volumes of imported LNG:

While hedge fund managers focus on Japan’s debt dynamics, they should monitor instead these fragile energy-balance dynamics for the trigger to Japan’s next crisis.

To purchase, please follow the link below:

“TerraJoule.us eBook – May 2013” by Gregor Macdonald – Editor on Ganxy