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BATTERY PRICE DROPS HINT AT DEMAND SHORTFALL: The price of batteries used in electric vehicles and energy storage dropped 10% in August, according to a new report from the market research firm TrendForce, with further declines expected through the fall that could force EV makers to decide between the alternatives of either dropping their car prices or slowing manufacturing.
The average price drops for battery cells highlight an “uninspiring growth pattern in the EV market,” the report said.
“Expectations for robust August demand in the energy storage market fizzled out, exacerbated by weakened overseas demand,” it said.
To be sure, U.S. consumers are buying more EVs. But they are not doing so at a pace consistent with current production levels—causing a supply surplus.
According to the most recent data from Cox Automotive, U.S. dealers have more than 92,000 unsold EVs in stock—roughly three times the supply last year.
Why it matters: North American automakers have bet big on EVs, with more than 90 new models expected to hit U.S. markets between 2023-2026, according to the firm AutoForecast Solutions. At least 91 models are already available.
Billions have been invested in EV production and battery manufacturing in North America, buoyed by President Joe Biden’s ambitious EV targets and tax incentives aimed at shoring up manufacturing. But if the trend continues, TrendForce said, companies might be forced into tough choices.
“With a glut in China’s storage cell production capacity, a price war appears unavoidable, with a continued gradual price decline expected for the rest of the year,” it said.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Breanne Deppisch (@breanne_dep) and Nancy Vu (@NancyVu99). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
SOLAR GOING UP: The U.S. solar industry is expected to add a record 32 gigawatts of production capacity this year, up by 53% from last year, according to a new report released Thursday by the Solar Energy Industries and Wood Mackenzie.
The report estimated that solar capacity would grow from 153 GW to 375 GW by 2028, as supply chain issues that arose due to the coronavirus pandemic ease up. Investment incentives from the Inflation reduction Act also contributed to the growth of the industry.
Increased investment in domestic manufacturing could see the country’s solar module production skyrocket by 2026 – if all new factory plans materialize, Wood Mackenzie said.
“Announcements for domestic module manufacturing have exploded, promising more stable solar module supply in the future. Now the challenge becomes implementation,” Michelle Davis, head of global solar at Wood Mackenzie, said in a statement. Read the report here.
TEXAS’S ENERGY EMERGENCY: The Biden administration declared a power emergency in Texas Thursday evening, amid soaring electricity demand ignited by scorching temperatures, Bloomberg reports.
The order, which is in effect until 9 p.m. local time, was issued by the Department of Energy to allow the state’s grid operator to waive some air-pollution limits so generators can produce more power.
The Electric Reliability Council of Texas requested the emergency order “to preserve the reliability of the bulk electric power system.”
Surging energy demand “threatens to cause loss of power to homes and local businesses in the areas that may be affected by curtailments, presenting a risk to public health and safety,” DOE stated in its order.
The declaration comes as the state still continues to struggle with a brutal heat wave that has pushed demand for electricity through the roof. ERCOT has issued a number of conservation appeals over the summer to lessen stress on the grid. Read more here.
GREEN POLICIES = POPULIST VOTERS, PER EUROPEAN PARLIAMENT PRESIDENT: The president of the European Parliament said that Brussel’s growing list of climate and industrial regulations is pushing voters toward populist parties ahead of the EU-wide elections in June.
In an interview with the Financial Times, Roberta Metsola asserted that Euroscepticism is growing because “parties of the centre” – referring to her own European People’s party and the center-left Socialists and Democrats – “took their voters for granted.”
“If the EPP and S&D have lost ground, we have to ask ourselves why. Why have we stopped talking to our businesses? Have we not placed being climate ambitious as not being mutually exclusive with economic growth?” Metsola told the FT.
The president said that a “proportionality test” and a proper cost assessment was needed for further regulations on industries and climate change.
The remarks marked a surprising shift from Metsola, who has largely kept away from the rightward shift of her party and has largely kept to supporting the majority policy positions of the Parliament as a whole.
The comments drew ire from Green EU lawmakers, according to POLITICO EU. Terry Reintke – a German member of the European Parliament who co-chairs the Greens’ group – called on Metsola to distinguish her position from those of Parliament in an X post on Thursday. Michael Bloss, another German Green, called for Metsola to apologize.
NATURAL GAS PRICES JUMP ON STRIKES AT AUSTRALIAN LNG PLANTS: The commencement of labor strikes at Chevron natural gas plants in western Australia had prices at the Dutch TTF hub jumping as much as 10% this morning, as traders reckoned with the drop in supply.
Workers at the Gorgon and Wheatstone LNG facilities went on strike after talks with management failed this week, and no further discussions are planned between the unions and Chevron, according to CNBC.
The facilities accounted for about 7% of global LNG supply last year. Japan is the biggest buyer.
PERMITTING REFORM MEETING NEXT WEEK: Senate Energy and Natural Resources Chairman Joe Manchin said that lawmakers are going to meet informally next week to work on the issue of permitting reform, according to reporting from E&E News.
The West Virginia Democrat’s comments follow a hearing on the Energy Department’s use of AI, as lawmakers struggle to keep the ball rolling on reforming the long, arduous permitting process.
“We’re going to meet next week on it, trying to move it forward,” Manchin said. He added, “We’re working on it. It’ll be informal.”
The issue of permitting reform became relevant during Thursday’s hearing, when DOE deputy secretary David Turk suggested that the federal government should be taking advantage of AI to possibly speed up the process of permitting for energy projects.
“If we can harness that data with algorithms with AI, we can shrink the timelines with permitting, we can take advantage of that data in a way that allows us to do what we need to do, which is build out our electricity infrastructure, our transmission, other kinds of infrastructure that we need in our country,” Turk said.
The schedule crunch: Lawmakers are going to be tuned into passing government spending measures before the Sept. 30 deadline, with the objective of avoiding a government shutdown. If Congress passes a stopgap funding measure, members will then be focused on passing an even broader government funding measure for the 2024 fiscal year. We’ll keep our eyes peeled if permitting reform finds a way into any moving legislative vehicle.
US OPEN SEMIFINAL DELAYED FOR 50 MINUTES BY CLIMATE PROTEST: Climate protesters disrupted the U.S. Open semifinal last night between American Coco Gauff and Czech Karolina Muchova for 50 minutes.
The activists, wearing “End Fossil Fuels” t-shirts, began preventing play in the second set. One of them glued his feet to the concrete floor. Removing him necessitated intervention not just from security guards but also from NYPD and medical personnel.
Extinction Rebellion NYC took credit for the protest. Activist Laura Cole said that the group disrupted a womens’ match because “we operate on a tight budget…. [M]ale games are significantly more expensive.”
The 19 year-old Gauff went on to win the match and reach her first U.S. Open final, where she’ll face Belarussian Aryna Sabalenka.
ON OUR RADAR: CRES has opened registration for the 7th Annual National Clean Energy Week later this month.
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