Gulf region can follow UK in tapping into ‘big potential’ of renewable energy: British expert

Countries in the Gulf region have been urged to learn from the UK and tap into the “big potential” of renewable energy and cleaner energy sources. (AFP/File Photo)
Updated 05 July 2019
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Gulf region can follow UK in tapping into ‘big potential’ of renewable energy: British expert

  • UK was once a global oil producer, but supplies dwindled so much that it now imports oil and transitioned to consuming renewables
  • Solar, wind and tidal are the cheapest forms of any power generation

LONDON: Countries in the Gulf region have been urged to learn from the UK and tap into the “big potential” of renewable energy.
Britain has had considerable interest from the Arab market about the adoption of clean energy sources, but a lack of acceptance from society was often holding back further commitment, said Frank Gordon, head of policy at the UK’s Renewable Energy Association.
Speaking on the sidelines of a London summit to promote Arab-British investment opportunities post Brexit, Gordon told Arab News that there were many lessons that could be learned from the UK experience in helping countries in the region transition to renewables.
Although Saudi Arabia and other neighboring countries were pursuing nuclear energy, Gordon said governments and societies needed to realize that renewable energy was not just cleaner and environmentally friendly, but also cheaper economically and had better health aspects.
“The Gulf states are keen to preserve their oil reserves for exporting opportunities to maximize a very valuable resource,” said Gordon, adding that they were looking toward promoting renewables to provide alternative energy means for their countries.
Britain was once a global oil producer, but its supplies have dwindled to such an extent that it now imports oil and has transitioned to consuming renewables. One-third of all electricity produced in the UK comes from renewable sources.
“In the UK, you can build renewable energy for about half the price of nuclear power and about two-thirds of the price of newly built gas power,” Gordon said.
Solar, wind and tidal were the cheapest forms of any power generation, he added, but most of the focus and major plans would likely be on solar energy in the Gulf, “which has big potential.”
He said: “The region would not be able to access the around 14 types of renewable sources currently available in the world, due to education, geographic circumstances and lack of acceptance and education.”
A lot of governments had ambitious programs and could benefit from the vast training programs that the UK offered, he added.
Citing Britain’s experience, Gordon said the transition to relying on renewable energy would need public acceptance and education, while local communities would have to be involved in projects from the start.


Debut of China’s Nasdaq-style board adds $44bn in market cap

Updated 22 July 2019
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Debut of China’s Nasdaq-style board adds $44bn in market cap

  • Activity draws attention away from main board

BEIJING: Trading on China’s new Nasdaq-style board for homegrown tech firms hit fever pitch on Monday, with shares up as much as 520 percent in a wild debut that more than doubled the exchange’s combined market capitalization and beat veteran investors’ expectations.

Sixteen of the first batch of 25 companies — ranging from chip-makers to health care firms — increased their already frothy initial public offering (IPO) prices by 136 percent on the STAR Market, operated by the Shanghai Stock Exchange.

The raucous first day of trade tripped the exchange’s circuit breakers that are designed to calm frenzied activity. The weakest performer leapt 84.22 percent. In total, the day saw the creation of around 305 billion yuan ($44.3 billion) in new market capitalization on top of an initial market cap of around 225 billion yuan, according to Reuters’ calculations.

“The price gains are crazier than we expected,” said Stephen Huang, vice president of Shanghai See Truth Investment Management. “These are good companies, but valuations are too high. Buying them now makes no sense.”

Modelled after Nasdaq, and complete with a US-style IPO system, STAR may be China’s boldest attempt at capital market reforms yet. It is also seen driven by Beijing’s ambition to become technologically self-reliant as a prolonged trade war with Washington catches Chinese tech firms in the crossfire.

Trading in Anji Microelectronics Technology (Shanghai) Co. Ltd., a semiconductor firm, was briefly halted twice as the company’s shares hit two circuit breakers — first after rising 30 percent, then after climbing 60 percent from the market open.

HIGHLIGHTS

• 16 of 25 STAR Market firms more than double from IPO price.

• Weakest performer gains 84 percent, average gain of 140 percent.

• STAR may be China’s boldest attempt at capital market reforms yet.

The mechanisms did little to keep Anji shares in check as they soared as much as 520 percent from their IPO price in the morning session. Anji shares ended the day up 400.2 percent from their IPO price, the day’s biggest gain, giving the company a valuation of nearly 242 times 2018 earnings.

Suzhou Harmontronics Automation Technology Co. Ltd., in contrast, triggered its circuit breaker in the opposite direction, falling 30 percent from the market open in early trade before rebounding. But by the market close, the company’s shares were still 94.61 percent higher than their IPO price.

Wild share price swings, partly the result of loose trading rules, had been widely expected. IPOs had been oversubscribed by an average of about 1,700 times among retail investors.

The STAR Market sets no limits on share prices during the first five days of a company’s trading. That compares with a cap of 44 percent on debut on other boards in China.

In subsequent trading sessions, stocks on the new tech board will be allowed to rise or fall a maximum 20 percent in a day, double the 10 percent daily limit on other boards.

Regulators last week cautioned individual investors against “blindly” buying STAR Market stocks, but said big fluctuations were normal.

Looser trading rules were aimed at “giving market players adequate freedom in the game, accelerating the formation of equilibrium prices, and boosting price-setting efficiency,” the Shanghai Stock Exchange (SSE) said in a statement on Friday.

The SSE added that it was normal to see big swings in newly listed tech shares, as such companies typically have uncertain prospects, and are difficult to evaluate.