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Forget AI. Maguire: The bigger problem in the power sector is keeping cool.
In the developed world, utilities are struggling to meet demand from data centres. Globally, however, the challenge of keeping people cool will be a greater drain on power grids. Data centres and air conditioners will both triple their electricity consumption over the next decade. This will put utilities under severe strain, already struggling with aging grids, and long backlogs of new supply. According to the International Energy Agency, data centre electricity consumption is expected to increase by 800 terawatt-hours (TWh) in 2035 from 416 TWh around 2024. According to the U.S. Energy Information Administration, this is enough electricity to power 75 million American households for an entire year. The global demand for cooling systems is expected to increase by 1,200 TWh in 2035. That's nearly as much energy as the Middle East consumes each year, according to data from thinkthank Ember. The location of the demand spike and the consequences of not meeting this spike also differ significantly between the drivers. The majority of data centres are expected to expand in developed economies that have modern power networks. Demand will increase primarily due to the processing of search requests from businesses and social media apps. The vast majority of air conditioning demand is expected to grow in emerging economies, where heat-related illnesses and deaths are already a threat for many communities. The likelihood of increased deaths and human suffering in developing countries, which could be the result of a power system shortage, is of a completely different magnitude from the economic impact and risk of slower searches that may occur if power supply for data hubs are not improved. BUILDING EFFECT Climate change will lead to heatwaves that are more intense, longer and more frequent in many parts of the world. This is especially true in developing countries like South and Southeast Asia, where high humidity can increase the effects of heat stress. According to a report by India's Centre for Science and the Environment, "even a heatwave lasting only a few day can cause tens and thousands of deaths excess in India." In order to combat this, many new homes and office buildings in countries with warm climates are increasing the number of cooling systems they contain. Many of these areas have already experienced a construction boom, which has increased the need to cool space. According to the IEA, in 2022, approximately 36% of households will have some type of air conditioning. By 2035 this share is expected jump from 50% to 60%. IEA data show that to power this expanding footprint, installed cooling capacity is expected to increase from around 850 gigawatts in 2022, to 1,750 GW in 2035, and 2,700 GW in 2050. INDIA-LED In the next decade, India will be the largest consumer of cooling systems. It has the largest population in the world and will have the largest economy. According to the IEA, India currently has around 110 million air conditioners out of the 2.4 billion units used globally. By 2035, India will have a 13% share in the global air conditioner market (approximately 500 million units). This figure is expected to reach more than 1.1 Billion units by 2050. Indonesia, a fast-growing nation with a large population prone to humid and hot weather, will triple its air conditioners by 2035. Brazil, Mexico, and the Middle East all plan to double theirs. WIDENING LOADS All regions will have to work hard in order to increase electricity supply in order for data centres and cooling system demand to grow as projected. The challenges of addressing these demand drivers are different depending on where power is required. Most data centres in the United States and Europe are built near existing generation sites so that server farms have access to uninterrupted power without transmission delays. Many of the cooling systems in developing economies are located within multi-story buildings or on previously undeveloped lands. This means that power providers have to expand their geographical reach and increase volumes. In India, Indonesia, and other countries, the need to increase the scale and scope of electricity production may lead to an expansion of the use of coal, which could cause pollution and accelerate the warming trend. The sheer size of the energy demand will mean that fossil fuels will be insufficient to meet this growth. A variety of other power sources will be required. The "all-of-the above" approach means that clean energy and renewable resources should become a larger part of the mix of electricity generation over time. This could lead to the eventual elimination of high pollution fuels. In the short term, fossil fuels will be burned more to meet the increasing demand for electricity. Heat stress will only increase in the future as people are forced to stay safe and comfortable at higher temperatures. This puts more strain on already stressed electrical grids. These are the opinions of a columnist who writes for. You like this article? Check it out Open Interest The new global financial commentary source (ROI) is your go-to for all the latest news and information. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on You can find us on LinkedIn.
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The fear of an Iranian oil calamity in Hormuz is more than just a myth.
Fears of Middle East oil disruption after US strikes on Iran Iran has attempted to blockade the Strait of Hormuz in the past. US Navy is likely to respond quickly in the event of disruptions Ron Bousso LONDON, 22 June - The U.S. strikes against several Iranian nuclear sites are a significant escalation in the Middle East conflict. This could cause Tehran to disrupt essential exports of gas and oil from the region, causing a spike in energy prices. History tells us, however, that any disruption will likely be brief. Since Israel launched surprise airstrikes on Iran on June 13 investors and energy markets were on high alert, fearing disruption of oil and natural gas flows from the Middle East. This was especially true for the Strait of Hormuz - a chokepoint that connects Iran with Oman, and through which 20% of global demand for oil and natural gas passes. Since June 13, Brent crude oil prices have increased by over 10%, to more than $77 per barrel. Although Israel and Iran have both targeted their respective energy infrastructures, there has not been a significant disruption of maritime activity in the area so far. The decision of President Donald Trump to bomb three of Iran's nuclear sites early Sunday morning, along with Israel, could change Tehran's calculations. Iran has few options and could respond by attacking U.S. targets in the region or disrupting oil flow. Although such a move is almost certain to lead to an abrupt spike in energy prices worldwide, the history of the market and its current dynamics suggests that any move will likely be less harmful than investors fear. Can they do it? First, we need to know if Iran has the capability of blocking or seriously disrupting the Strait of Hormuz. Answer: Probably yes. Iran could try to place mines in the Strait which measures 34 km wide (21 miles at its narrowest). The Iranian army or paramilitary Islamic Revolutionary Guard Corps could also strike or seize ships in the Gulf. This is a tactic they have used in recent years. Hormuz was never completely blocked but it has been interrupted several times. During the Iran-Iraq War of the 1980s, both sides were involved in what was called the "Tanker Wars", which took place in the Gulf. Iraq attacked Iranian ships and Iran attacked commercial vessels, including Saudi, Kuwaiti, and U.S. Navy ships. Ronald Reagan, the then-President of the United States, deployed his navy in 1987 and 1988 after Kuwait appealed to him. This was called Operation Earnest Will. The operation ended shortly after an American navy ship shot down Air Iran Flight 655 killing all 290 of its passengers. At the end of 2007, tensions in the Strait erupted again in a series skirmishes involving the Iranian and U.S. Navy. One incident involved Iranian speedboats approaching U.S. battleships. No shots were fired. In the Gulf of Oman, Iranian troops captured the Advantage Sweet crude oil tanker chartered by Chevron in April 2023. The vessel was freed more than a full year later. The U.S. Navy would respond to any Iranian attempt at disrupting maritime traffic in the Gulf with a swift, forceful response, thus limiting the possibility of a long-lasting supply shock. HISTORY LESSON History has shown that major disruptions in global oil supply have been short-lived. Brent crude doubled to $40 per barrel in mid-October 1990 after Iraq invaded Kuwait. By January 1991, prices had returned to pre-invasion levels after a U.S. led coalition launched Operation Desert Storm. Kuwait was liberated the following month. Even less impactful was the start of the second Gulf War between March and may 2003. The 46% rise in stock prices between November 2002 to March 2003, which was the period leading up to the war, was reversed quickly in the days before the U.S. led military campaign. In February 2022, Russia invaded Ukraine, causing oil prices to spike to $130 per barrel. However, prices fell back to $95 in mid-August, their levels before the invasion. The rapid rise in oil prices curbed the demand at the time, and this was a major factor for the relatively quick turnaround of the oil price spikes, according to Tamas Varga an analyst with oil brokerage PVM. The global oil market was also shook by the Arab embargo of 1973 and the Iranian revolution of 1979, when attacks on oilfields in the country severely disrupted the production. These attacks did not include the blockade of Hormuz, and they were not met by a direct military response from the United States. There is certainly spare capacity on the current global oil markets. OPEC+ is an alliance of oil producing nations that holds around 5.7 millions barrels of excess capacity per day. Saudi Arabia and United Arab Emirates have 4.2 million bpd. Today, the Strait of Hormuz is the main route through which oil is transported from Saudi Arabia and UAE. However, the two Gulf countries could bypass this strait via oil pipelines. Saudi Arabia is the top oil exporter in the world, with around 9 million barrels per day. It has a crude oil pipeline that runs between the Abqaiq Oilfield in the Gulf Coast in the east and the Red Sea port of Yanbu in west. The pipeline can handle 5 million barrels per day and has been temporarily expanded by 2 million barrels per day in 2019. The UAE produced 3.3 millions bpd of oil in April. A 1.5 million bpd oil pipeline links its oilfields on the coast to the Fujairah terminal, east of the Strait of Hormuz. This western route is also vulnerable to the attacks of the Houthis, who are backed by Iran and have disrupted the Suez Canal shipping in recent years. Iraq, Kuwait, and Qatar have no other alternative to the Suez Canal. Iran may decide not to block the Strait, in part, because it would disrupt its oil exports. Tehran may also see any further escalation as futile in light of U.S. intervention and instead downplay the importance and return to nuclear negotiations. Fearing a further escalation of the situation, the energy markets are likely to react to the U.S. strike with a dramatic increase in crude oil prices. Even in the worst-case scenario, where the Strait of Hormuz was blocked, historical evidence suggests that markets shouldn't expect a persistent supply shock. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X.
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South Africa accepts a World Bank loan of $1.5 billion to upgrade infrastructure
The National Treasury announced on Monday that South Africa had signed a loan agreement worth $1.5 billion with the World Bank to revamp its energy and transport infrastructure, and re-ignite the economy. Over the past decade, Africa's most developed economy has struggled with growth. Regular blackouts have crippled its productivity. Meanwhile, deteriorating rail networks and chronically crowded ports have hampered major industries like mining and automaking. The government hoped the loan would ease transportation bottlenecks and increase energy security. However, it did not specify what specific projects World Bank money was to be used for. This financing will also help to limit the rise in debt service costs, as it has more favorable terms than commercial loans. Since years, state-owned energy companies Eskom, and Transnet, have suffered from operational and financial problems, preventing growth. In the first quarter, it rose only 0.1%. The Treasury set the rate of interest on the World Bank loan at six-month Secured overnight Financing plus 1.49%. This is not the $500 million in financing that the World Bank Group has considered to unlock private investment into the electricity transmission grid. The grid needs to be extended to connect more renewable projects. The budget presented by Finance Minister Enoch Goongwana last month included more than 55 billion rand (over 1 trillion rand) in investments across transportation, energy, and water to support public services and growth. The goal was to have the public debt peak at 77.4% gross domestic product during the current fiscal period, and then slowly decline afterward.
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Grid operator PJM issues maximum production alert for Monday amid heatwave
Grid operator PJM Interconnection issued an alert on Monday, asking generators to prepare to run at full capacity if necessary. The hot weather is continuing in the east U.S. area that the grid operator services. PJM said that it expects to meet its electricity requirements of 160,000 MW Monday, 158,000 MW Tuesday, and 155,000 MW Wednesday. Grid operator stated that the alert was intended for transmission and generation owners so they can plan maintenance accordingly. It also sends a signal to nearby regions to reduce PJM's power exports. PJM has issued a hot weather alert for the entire service area of PJM, including all or part of New Jersey, Illinois, and District of Columbia. The U.S. is preparing major cities for extreme temperatures due to a heat dome which hit the U.S. Plains last Friday and will likely spread to the rest of the nation in the next few days. (Reporting by Ishaan Arora in Bengaluru; Editing by Jan Harvey)
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Middle East flights suspended by airlines
Israel's attacks against Iran prompted some international airlines to cancel flights to Middle East destinations because of airspace closures and safety concerns. The conflict has entered a new phase after the U.S. invasion on Iranian nuclear sites Some airlines have cancelled flights to hubs such as Dubai is Qatar's Doha. Here are some airlines that have canceled flights from and to the region. AIRBALTIC AirBaltic, a Latvian airline, has announced that it will cancel all flights from and to Tel Aviv up until 30 September. AEROFLOT Aeroflot, a Russian airline, has announced that it has cancelled flights between Moscow & Tehran and changed other routes throughout the Middle East. AIR EUROPA Spanish airline cancels flights from and to Tel Aviv through July 31. AIR FRANCE-KLM Air France has suspended flights to and out of Tel Aviv, until further notice. Air France KLM has cancelled flights from and to Dubai and Riyadh for the 22nd and 23rd of June. KLM has cancelled all flights from and to Tel Aviv, at least until July 1, and warned that flights from, to or via Beirut may be affected until June 29. DELTA AIR LINES Travel to, from or through Tel Aviv could be affected between June 12 and July 31. EL AL ISRAEL AIRLINES The airline announced that it has cancelled all regular flights to EL AL and Sundor until June 27. Flights scheduled to depart until July 15 are also closed to new bookings. ETIHAD AERWAYS The airline said it would cancel flights between Abu Dhabi, Amman and Tel Aviv between June 20 and July 15, and between Abu Dhabi, Amman and Tel Aviv. EMIRATES Emirates has temporarily suspended its flights to and out of Iran (Teheran), Iraq (Baghdad, Basra), and Afghanistan (Bahdad and Basra), until June 30. FLYDUBAI Flydubai has temporarily suspended its flights to and out of Iran, Iraq and Israel until June 30, 2018. British Airways, owned by IAG, has announced that flights to Tel Aviv will be suspended until July 31, and flights to Amman or Bahrain will also be suspended until June 30. After cancelling flights to and from Dubai and Doha the previous day, British Airways was scheduled to resume Dubai and Doha routes on June 23, Iberia Express, IAG's low cost airline, announced previously that it would cancel its flights to Tel Aviv up until June 30. ISRAIR Israeli Airlines has announced that all flights to and from Israel have been cancelled until June 30, 2018. Israir has halted the sale of its flights up to July 7 inclusive. ITA AIRWAYS Italian Airlines announced that it will extend the suspension of Tel Aviv flight until July 31. This includes two flights scheduled for August 1. LUFTHANSA GROUP Lufthansa has suspended flights from and to Tel Aviv, Tehran and Beirut until July 31. Amman and Erbil flights are cancelled through July 11. German Airlines added that they would not use the airspace of these countries until further notice. PEGASUS Turkish Airlines has announced that they have cancelled all flights to Iran and Iraq until July 30, and all flights to Lebanon, Jordan and Lebanon until June 30. QATAR AIRWAYS Qatar Airways has temporarily cancelled all flights from and to Iraq, Iran and Syria. RYANAIR Ryanair has announced that it will cancel flights from and to Tel Aviv up until September 30. SINGAPORE Airlines The Asian carrier has cancelled flights from Singapore to Dubai up until the 25th of June. Romania's flag airline has suspended all commercial flights from and to Tel Aviv, Beirut, and Amman till June 24. TUS AIRWAYS The Cypriot Airlines cancelled all flights scheduled to depart and arrive in Israel until June 30, inclusive. The airline said that flights scheduled to depart between July 1-7 are currently sold out, pending any further developments. UNITED AIRLINES According to the U.S. airline, travel from and to Tel Aviv could be affected between June 13, and August 1, 2013. There may be problems with flights to and from Dubai between June 18th and July 3th. WIZZ AIR Wizz Air has announced that it will suspend its flights to and from Tel Aviv, Amman and Jordan until September 15, 2015. Hungarian Airlines will not overfly Israeli, Iraqi or Iranian airspaces until further notice. (Reporting and compilation by bureaus, compiled by Agnieszka Olesnka, Elviira Loma, and Tiago Brancao; Editing by Matt Scuffham, Alison Williams and Matt Scuffham)
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Tankers U-turn and zigzag around Strait of Hormuz
Ship tracking data indicates that at least two supertankers have made U-turns in the Strait of Hormuz after U.S. strikes against Iran. This is due to the violence which has been raging for more than a full week. Washington's decision in joining Israel's attack on Iran has raised fears that Iran may retaliate and close the strait connecting Iran to Oman, through which 20% of global gas and oil demand passes. This has led to predictions that oil will surge past $100 per barrel. Industry sources say that disruption is already apparent, as tankers avoid spending longer than necessary in the Strait. Sentosa Shipbrokers, based in Singapore, reported that during the last week, the number of empty tankers entering Gulf has decreased by 32% and the number of loaded tankers departing the Gulf is down 27% compared to early May levels. Kpler data and LSEG showed that the Coswisdom Lake (VLCC), a very large oil carrier, reached the strait before turning around and heading south. It turned back on Monday, and resumed its journey to the port of Zirku (United Arab Emirates). South Loyalty (also a VLCC) made a similar U turn and remained outside of the strait Monday, LSEG showed. According to Kpler and two shipping sources, it was due to load crude oil from Iraq's Basra Terminal. The Coswisdom Lake had been scheduled to deliver crude oil to China via Zirku. According to LSEG, Kpler and LSEG data, it was chartered Unipec. This is a trading division of China's Sinopec. Sinopec didn't immediately respond to an inquiry for comment. No lagging KY Lin, a spokesperson for Taiwan's Formosa Petrochemical Corp., said that shipowners would try to minimize the time vessels spend in the Strait of Hormuz as a result of the conflict. He said that vessels would only enter the area when they were nearing their loading time. Japanese shipping companies Nippon Yusen & Mitsui O.S.K. Lines announced on Monday that they will continue transiting the strait, but have instructed vessels to spend as little time in the Gulf. Oil traders and analysts said that they were warned about possible delays in shipping as vessels waited for their turn to leave the area. Press TV in Iran reported that the Iranian parliament approved a measure on Sunday to close the Strait. However, any such action would need approval from the Supreme National Security Council. Iran has not closed the Strait of Hormuz in the past, despite previous threats.
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Middle East flights suspended by airlines
Israel's attacks against Iran has prompted international carriers to stop flights to certain Middle East destinations because of airspace closures and safety issues. The conflict has entered a new phase after the U.S. invasion on Iranian nuclear sites Some airlines have cancelled flights to hubs such as Dubai is Qatar's Doha. Here are some airlines that have canceled flights from and to the region. AIRBALTIC AirBaltic, a Latvian airline, announced that it had cancelled all flights from and to Tel Aviv up until September 30. AEROFLOT Aeroflot, a Russian airline, has announced that it has cancelled flights between Moscow & Tehran and changed other routes throughout the Middle East. AIR EUROPA Spanish airline cancels flights from and to Tel Aviv through July 31. AIR FRANCE-KLM Air France has suspended flights to and out of Tel Aviv, until further notice. Air France KLM has cancelled flights from and to Dubai and Riyadh for the 22nd and 23rd of June. KLM has cancelled all flights from and to Tel Aviv, at least until July 1, and warned that flights from or to Beirut may also be affected until June 29. DELTA AIR LINES Travel to, from or through Tel Aviv could be affected between June 12 and July 31. EL AL ISRAEL AIRLINES The airline announced that its normal flight schedules for EL AL, Sundor and other destinations had been cancelled through June 23, 2018. Flights scheduled to depart until July 15 are also closed to new bookings. ETIHAD AERWAYS The airline said it would cancel flights between Abu Dhabi, Amman and Tel Aviv between June 20 and June 30. EMIRATES Emirates has temporarily suspended its flights from and to Jordan (Amman), Lebanon (Beirut), Iran (Teheran), and Iraq (Baghdad, Basra and Basra), until June 30, and Iran (Teheran), and Iraq (Baghdad, Basra and Basra). FLYDUBAI Flydubai has temporarily suspended its flights to and out of Iran, Iraq and Israel until June 30, 2018. British Airways, owned by IAG, has announced that flights to Tel Aviv will be suspended until July 31, and flights to Amman or Bahrain are suspended through June 30. After cancelling flights to and from Dubai and Doha the previous day, British Airways was scheduled to resume Dubai and Doha routes on June 23, Iberia Express - IAG's low cost airline - had announced previously that it would cancel its flights to Tel Aviv up until June 30. ISRAIR Israeli Airlines announced that all flights to and from Israel have been cancelled until June 30, 2018. ITA AIRWAYS Italian Airlines announced that it will extend the suspension of Tel Aviv flight until July 31. This includes two flights scheduled for August 1. LUFTHANSA GROUP Lufthansa has suspended flights from and to Tel Aviv, Tehran and Beirut until July 31. Amman and Erbil flights are cancelled through July 11. German Airlines added that they would not use the airspace of these countries until further notice. PEGASUS Turkish Airlines has cancelled all flights to Iran and Iraq until June 30, and to Lebanon, Jordan and Lebanon until June 23, according to the airline. QATAR AIRWAYS Qatar Airways has temporarily canceled flights to and from Iraq Iran and Syria. RYANAIR Ryanair has announced that it will cancel flights from and to Tel Aviv up until September 30. SINGAPORE Airlines A security assessment led the Asian carrier to cancel flights from Singapore to Dubai on June 22, 2018. The flight was scheduled to resume on the 23rd of June. Romania's flag airline has suspended all commercial flights from and to Tel Aviv, Beirut, and Amman till June 24. TUS AIRWAYS The Cypriot Airlines cancelled all flights scheduled to depart and arrive in Israel until June 24, inclusive. The airline said that flights scheduled to depart between June 25 and 30 will be closed for sales pending any further developments. UNITED AIRLINES According to the U.S. airline, travel from and to Tel Aviv could be affected between 13 June and 1 August. There may be problems with flights to Dubai between the dates of June 18 and 25, as well. WIZZ AIR Wizz Air has announced that it will suspend its flights to and from Tel Aviv, Amman and Jordan until September 15, 2015. Hungarian Airlines will not overfly Israeli, Iraqi or Iranian airspaces until further notice. (Reporting and compilation by bureaus, compiled by Agnieszka Olesnka, Elviira Loma, and Tiago Brancao; Editing by Matt Scuffham, Alison Williams and Matt Scuffham)
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New York Times Business News - June 23,
These are the most popular stories from the New York Times' business pages. These stories have not been verified and we cannot vouch for the accuracy of these reports. Tesla released a small fleet of self-driving cabs to pick up paying passengers in Austin, Texas on Sunday. Elon Musk announced the "robotaxi" launch and social media influencers posted videos of their initial rides. Frederick Smith, the founder of FedEx Corp. and former CEO, died at the age 80. Smith founded the global delivery conglomerate in the 1970s with over a dozen aircraft. The U.S. Judge on Sunday ordered Kilmar Garcia, who was wrongfully deported back to El Salvador in early June, to be released on bail until his criminal trial for smuggling migrants. On Sunday, a Senate official rejected a provision in the Republican's domestic policy bill which could limit lawsuits that seek to block U.S. president Trump's executive action. (Compiled by Bengaluru Newsroom)
Spanish power utilities accuse grid operator of April blackout
Aelec, the Spanish lobby for power utilities, blamed Monday the poor planning of grid operator REE for the massive blackout which hit Spain and Portugal in April 28. This was in contrast to REE’s earlier claim that power plants had been responsible.
Marina Serrano, Aelec chair, told reporters that during the blackout, the power plants of the country had followed the orders given by REE, an unit of Redeia.
Anton Garcia Diaz, Aelec expert, said that the report shows a lack of planning for conventional power generation.
Beatriz Corredor, chairwoman of Redeia, blamed conventional power stations - thermal power plant using coal and gas - on Wednesday for not maintaining a proper voltage.
She refuted an earlier report by the Energy Ministry which found that REE had failed to calculate the right mix of energy, and that this was one of the reasons for the grid's inability to deal with the outage. Reporting by Pietro Lombardi, Writing by Emma Pinedo, Inti Landauro and David Latona; Editing by David Latona
(source: Reuters)