Over the prior week the Eagle Global Renewables Infrastructure Index (RENEW) was flat, underperforming the S&P 500 by 1.3%. The Eagle North American Renewables Infrastructure Index (RENEWNA) returned +0.8%, underperforming the S&P 500 by 0.54%.
Source: Bloomberg. *Please review disclosure information at the end of this post.
Macro Mash Up
Global Climate Conference kicks off in Glasgow. The 2021 United Nations Climate Change Conference (a.k.a., COP26) is expected to be the first meeting since the Paris conference in 2015 where countries “ratchet up” ambitions to meet the challenge of a warming planet. In the leadup to the conference several large countries have detailed plans that will help facilitate this goal, like the European Union’s “Fit for 55” plan. However, some countries, including the United States, have merely a framework or a loose climate target that will limit the lofty goals many had hoped to come out of COP26. In addition, leaders from several other countries (e.g., China, Russia) are not planning to attend.
France’s grid operator furthers support for new nuclear. “In order to meet its carbon-neutral goals at the cheapest cost while maintaining reliability requires the construction of more nuclear reactors”, said the chairman of France’s grid (RTE) at a recent presentation. The analysis evaluated multiple scenarios (including an all-renewables scenario) and concluded the cheapest scenario would still drive up grid costs and include 14 new, large nuclear reactors and a series of smaller, mini nuclear reactors.
China outlines plan to cap emissions by 2030. The country released its official road map to cap emissions by 2030 in time for COP26, the major climate conference that starts next week. The plan offers new details on how individual sectors will be impacted, energy storage and transportation initiatives, caps on oil refining, and an expansion of hydropower and transmission to name a few.
United States and European Union target Chinese steel. After shelving the Transatlantic trade dispute, the U.S. and the E.U. are exploring ways to curb imports of dirty steel from China. Both countries are seeking out a global arrangement to support greener steel and aluminum production with reducing current overcapacity.
Greenpeace challenges E.U. to ban short airplane flights. In an example of environmental activists raising the pressure meter on government leaders, Greenpeace called on the E.U. to ban short flights on routes where a train journey under six hours is available. According to their own research, roughly 33% of the 150 busiest short-haul routes within the E.U. have a viable rail alternative.
Breakdown: RENEW Index
Source: Bloomberg
Breakdown: RENEWNA Index
Source: Bloomberg
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