Results were somewhat interesting.
Don't forget that as of January 1st, the Black Liquor Tax Credits will disappear.
And Canadian Credits are not really credits -- the company only gets them if they spend additional monies on "Energy Efficiency". Lots of projects to do, but no money to initiate them. I think they can either do three things in this regard:
1. As I mentioned previously, combine their stranded assets with others in the industry to "spin-off" via an IPO to the general marketplace, all potential Bio-Mass projects for upcoming Cap & Trade. NEW EPA rules annouced today, should also assist in evaluation.
2. Negotiate with an ESSCO directly to take-on the risk of converting stranded assets to Bio-Mass or other suitable projects in order to obtain Canadian Credits. I don't prefer this option, but it might be their only option due to limited current "cash flow".
3. Almost every day, Electricity Generation Projects are being evaluated, so 20-year forecasts that include a society with 25% electric automobiles is being factored into the price. Maybe ABWTQ should just sell the remainder of their generation assets now and buy their power needs under fixed price scenerios (caps and floors).
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I thought some might be interested in this information (below) on Cap and Trade, as undoubtedly Del. and Touche will have to include something in their upcoming valuation forecasts.
Tiabbi: GS next bubble is Green via Cap & Trade 1-Jul-09 10:27 pm
Re: Get me in on the next Goldman Bubble! 1-Jul-09 01:43 pm
It's Cap N Trade Trading on the Chicago Climate Exchange in which Goldman owns 10%. Skip the stock market and buy forest land.
Goldman Sachs Cap N Trade bill will require a house 1-Jul-09 10:49 inspection.
owner -- who wants to sell to get a house inspection to make sure it meets energy conservation requirements. You insulation, stove,refrig,etc. If it does not, you have to fix these before you can list it. Of course the requirements will be increased as years go by. Let's hope housing prices increased way,way beyond what you paid for it.
credit default swaps= naked shorted securities 30-Jun-09 07:13 pm = time bomb
Here's how it works: Cap n Trade Energy 28-Jun-09 11:51 am
Here's how it works: If the bill passes, there will be limits for coal plants, utilities, natural-gas distributors and numerous other industries on the amount of carbon emissions (a.k.a. greenhouse gases) they can produce per year. If the companies go over their allotment,.they will be able to buy "allocations" Or credits from other companies that have managed to produce fewer emissions. President Obama conservatively estimates that about $646 billion worth of carbon offsets will be auctioned in the first seventy years - one of his top economic aides speculates that the real number might be twice or even three times that amount.
The feature of this plan that has special appeal to speculators is that the "cap" on carbon will be continually lowered by the government, which means that carbon credits will become more and more scarce with each passing year. Which means that this is a brand-new commodities market where the main commodity to be traded is guaranteed to rise in price overtime. The volume of this new market will be upwards of a trillion dollars annually; for comparison's sake, the annual combined revenues of all electricity suppliers in the U.S. total $320 billion.
Goldman wants this bill. The plan is (1) to get in on the ground floor of paradigm shifting legislation, (2) make sure that they're the profit-making slice of that paradigm and (3) make sure the slice is a big slice. Goldman started pushing hard for cap-and-trade long ago, but things really ramped up last year when the firm spent $3.5 million to lobby climate issues. (One of their lobbyists at the time was none other than Patterson, now Treasury chief of staff.)
Back in 2005, when Hank Paulson was chief of Goldman, he personally helped author the bank's environmental policy, a document that contains some surprising elements for a firm that in all other areas has been consistently opposed to any sort of government regulation. Paulson's report argued that "voluntary action alone cannot solve the climate-change problem". A few years later, the bank's carbon chief, Ken Newcombe, insisted that cap-and-trade alone won't be enough to fix the climate problem and called for further public investments in research and development. Which is convenient, considering that Goldman made early investments in wind power (it bought a subsidiary called Horizon Wind Energy), renewable diesel (it is an investor in a firm called Changing World Technologies) and solar power (it partnered with BP Solar), exactly the kind of deals that will prosper if the government forces energy producers to use cleaner energy. As Paulson said at the time, "We're not making those investments to lose money."
The bank owns a 10 percent stake in the Chicago Climate Exchange, where the carbon credits will be traded. Moreover, Goldman owns a minority stake in Blue Source LLC, a Utah-based firm that sells carbon credits of the type that will be in great demand if the bill passes.
Nobel Prize winner Al Gore, who is intimately involved with the planning of cap-and-trade, started up a company called Generation Investment Management with three former bigwigs from Goldman Sachs Asset Management, David Blood, Mark Ferguson and Peter Harris. Their business? Investing in carbon offsets. There's also a $500 million Green Growth Fund set up by a Goldmanite to invest in green-tech ... the list goes on and on. Goldman is ahead of the headlines again, just waiting for someone to make it rain in the right spot. Will this market be bigger than the energy-futures market?
"Oh, it'll dwarf it," says a former staffer on the House energy committee.
