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Could this have an impact (positive or negative) on the renewables industry?

by _bxg1 7y ago

TomGullen 7y ago
I'd guess negative, cheaper oil makes renewables less competitive.
- extropy 7y ago
  Or unpredictable oil prices making oil burning energy more risky.
vikramkr 7y ago
Low oil prices makes it harder to compete for other energy sources.
- sfj 7y ago
  But if a bunch of oil companies go out of business due to this, and then they cut production again, oil prices might rise sharply in the months ahead.
  - vikramkr 7y ago
    Yep. And volatility is no fun for anyone in the meantime.
Arnt 7y ago
Renewables compete against the long-term oil price, not the spot price. If the Saudi are offering long-term cheap oil I haven't noticed.
- hn_throwaway_99 7y ago
  > Renewables compete against the long-term oil price, not the spot price. Not really. Hybrid vehicles for example tanked the last time oil prices plummeted.
  - Arnt 7y ago
    Tanked means what? Did any manufacturer close a factory, decided not to open one, cancel next year's model of a hybrid, etc?
    - hackeraccount 7y ago
      What's the number of factories not built or cars not produced because of the low price of oil?
      - Arnt 7y ago
        Considerable. All of the three biggest car parts manufacturers here in Germany have announced redundancies, two of them have announced factory closings. https://www.handelsblatt.com/unternehmen/industrie/autozulieferer-das-wird-noch-schmutzig-warum-der-jobabbau-bei-bosch-erst-der-anfang-sein-duerfte/24874108.html https://www.handelsblatt.com/unternehmen/industrie/autozulie... https://www.handelsblatt.com/unternehmen/industrie/zulieferer-continental-schliesst-werke-in-deutschland-7000-arbeitsplaetze-betroffen/25054202.html https://www.handelsblatt.com/unternehmen/industrie/zuliefere...
mechagodzilla 7y ago
Eh, 'renewables' (presumably you're thinking of solar and wind-generated electricity) don't really directly compete with oil (at least in the USA). Oil is a negligible part of our electricity generation mix. This might somewhat delay the switch over to battery-electric vehicles, as it lowers the cost of gasoline/diesel, but that has relatively little to do with renewables, per se, and more to do with the relative costs for electric power (regardless of source) and gasoline/diesel. A secondary effect, however, could be that it temporarily wrecks the fracking industry in the US, eventually leading to much less natural gas production, raising the price of natural gas (and thus being good for wind/solar, which will probably have gradually declining costs for the foreseeable future).
- toomuchtodo 7y ago
  Raising the price of natural gas is good for wind and solar, but moreso utility scale battery storage, which is what is competing against natural gas for firm capacity ("power on when you call for it").
teunispeters 7y ago
yes ;) High enough oil prices and people invest in alternatives But oil and its products are used in the production of many renewable infrastructure too ... so there's a point of diminishing returns. And at this point the issues of long distance transportation and large scale production are hurting both ends.
newguy1234 7y ago
Yes - negative impact. At the end of the day renewable energy is just producing a commodity product - electricity. As fossil fuels decline in price the wholesale price of electricity declines making it less attractive to build wind/solar etc. Existing plants will obviously stay online but people who invested in that sector will be hit.

Could this have an impact (positive or negative) on the renewables industry?

by _bxg1 7y ago

Could this have an impact (positive or negative) on the renewables industry?

TomGullen 7y ago

I'd guess negative, cheaper oil makes renewables less competitive.

extropy 7y ago
Or unpredictable oil prices making oil burning energy more risky.

vikramkr 7y ago

Low oil prices makes it harder to compete for other energy sources.

sfj 7y ago
But if a bunch of oil companies go out of business due to this, and then they cut production again, oil prices might rise sharply in the months ahead.
- vikramkr 7y ago
  Yep. And volatility is no fun for anyone in the meantime.

Arnt 7y ago

Renewables compete against the long-term oil price, not the spot price. If the Saudi are offering long-term cheap oil I haven't noticed.

hn_throwaway_99 7y ago
> Renewables compete against the long-term oil price, not the spot price. Not really. Hybrid vehicles for example tanked the last time oil prices plummeted.
- Arnt 7y ago
  Tanked means what? Did any manufacturer close a factory, decided not to open one, cancel next year's model of a hybrid, etc?
  - hackeraccount 7y ago
    What's the number of factories not built or cars not produced because of the low price of oil?
    - Arnt 7y ago
      Considerable. All of the three biggest car parts manufacturers here in Germany have announced redundancies, two of them have announced factory closings. https://www.handelsblatt.com/unternehmen/industrie/autozulieferer-das-wird-noch-schmutzig-warum-der-jobabbau-bei-bosch-erst-der-anfang-sein-duerfte/24874108.html https://www.handelsblatt.com/unternehmen/industrie/autozulie... https://www.handelsblatt.com/unternehmen/industrie/zulieferer-continental-schliesst-werke-in-deutschland-7000-arbeitsplaetze-betroffen/25054202.html https://www.handelsblatt.com/unternehmen/industrie/zuliefere...

mechagodzilla 7y ago

Eh, 'renewables' (presumably you're thinking of solar and wind-generated electricity) don't really directly compete with oil (at least in the USA). Oil is a negligible part of our electricity generation mix. This might somewhat delay the switch over to battery-electric vehicles, as it lowers the cost of gasoline/diesel, but that has relatively little to do with renewables, per se, and more to do with the relative costs for electric power (regardless of source) and gasoline/diesel. A secondary effect, however, could be that it temporarily wrecks the fracking industry in the US, eventually leading to much less natural gas production, raising the price of natural gas (and thus being good for wind/solar, which will probably have gradually declining costs for the foreseeable future).

toomuchtodo 7y ago
Raising the price of natural gas is good for wind and solar, but moreso utility scale battery storage, which is what is competing against natural gas for firm capacity ("power on when you call for it").

teunispeters 7y ago

yes ;) High enough oil prices and people invest in alternatives But oil and its products are used in the production of many renewable infrastructure too ... so there's a point of diminishing returns. And at this point the issues of long distance transportation and large scale production are hurting both ends.

newguy1234 7y ago

Yes - negative impact. At the end of the day renewable energy is just producing a commodity product - electricity. As fossil fuels decline in price the wholesale price of electricity declines making it less attractive to build wind/solar etc. Existing plants will obviously stay online but people who invested in that sector will be hit.