Experts rank the quality of Mexico's photovoltaic (PV) and solar thermal resources among the world's best. In terms of photovoltaic resources, the country has significant advantages:
Average Global Horizontal Irradiation (GHI) is approximately 5 kWh/m2/day, the energy equivalent of 50 times Mexico's annual national electricity generation
70% of the territory has GHI values greater than 4.5kWh/m2
Just 0.06% of the Mexican national territory would be sufficient to generate the overall electricity consumption of Mexico in 2005 according the GTZ report "Nichos de mercado para sistemas fotovoltáicos en conexión a la red eléctrica de México" (June 2009).
Global Horizontal Solar Radiation
Mexico's average solar resources for PV (5 kWh/m2/day) are more than 60% higher than the best solar in Germany (5.4 GW of installed PV). Spain and Germany are the global PV leaders, with a total of 8.7 GW, 67% of the world's PV installed capacity, according to the IEA Photovoltaic Power Systems Program 2008 Annual Report.
Comparative Solar Resources, PV Performance, Energy Pay-Back and Energy Return (GHI kWh/m2)
Sources: GTZ (2009) "Nichos de Mercado Para Sistemas Fotovoltáicos en Conexión a la Red Eléctrica en México," June 2009; International Energy Agency Photovoltaic Power Systems Programme (2006), "Compared assessment of selected environmental indicators of photovoltaic electricity in OECD cities," April 2006.Higher than Germany and Spain
According to the study Solar Energy Sector (2009) for the Mexican Secretaría de Energía (SENER, the Energy Department), PV installed in many cities across Northern and Central Mexico has an "energy payback time" (EPBT) of less than two years. This represents the time required for these PV systems to produce the amount of energy needed to manufacture all the PV components.
The EPBT is based on a figure of 2,525 kWh, the electrical energy required to manufacture 1 kW of a complete PV system. This kWh figure includes PV panels, wiring and electronic-connection devices. The EPBT varies according to the PV location's solar resources. This 2,525 kWh figure was used by the International Energy Agency in a 2006 report titled "Compared assessment of selected environmental indicators of photovoltaic electricity in OECD cities."
The "energy return factor" (ERF) for PV installed in most of Mexico produces 17 times the electricity required to manufacture the PV system, 1.5 times higher than the ERF for Germany, equal to most of Spain. The ERF refers to the amount of electricity produced over a 30-year period, minus the electricity required to manufacture the complete system. The ERF is the number of times the embodied energy from the PV manufacturing is produced over the life of the system. The average ERF for PV systems in Mexico is 1.7 years compared to 2.6 years for Munich.
Mexico's Insolation
Two facts emerge from the Solar Energy Sector study:
Northern Mexico's Direct Normal Insolation is equivalent to the best in the U.S. Southwest and in the North African deserts
Assuming a net system efficiency of 15%, a square of 25 km in Chihuahua or in the Sonora desert would be sufficient to supply all of Mexico's electricity (based on information provided by Energy Department and GTZ (2009) at the "Renewable Energy for Sustainable Development in México" study).
http://www.greentechmedia.com/articles/read/sunny-mexico-an-energy-opportunity/
Thursday, July 8, 2010
Wednesday, July 7, 2010
Sun Power May Beat Wind Power
JOE BOLKCOM • GUEST OPINION • JULY 6, 2010
Just days before the United States took to the pitch in a heated World Cup match against Slovenia, my colleagues and I enjoyed a friendly exchange on the small central European nation's soil, in the eighth annual Green Bike Tour.There we found that we could learn from Europe about much more than how to kick a checkered ball -- we could take note of its investments in efficient and renewable energy. And just as the solid performance of Americans turned the heads of soccer aficionados around the globe, the news of Iowa's progress in cleaner energy proved able to impress our Slovenian hosts.
Joined by veteran green bikers, David Osterberg, Ed Woolsey -- and John Moreland and our gracious Slovenian host, Professor Mladen Franko of the University of Nova Gorica -- we had a busy schedule with a series of meetings with government officials, energy experts, renewable energy producers, non-governmental organization leaders, students and university faculty. All in all, we learned a lot about Slovenia's energy efforts and of our own.
Iowa has quickly caught up with our continental neighbors since the 2002 European Green Bike Tour. At that time, Germany, Denmark and Holland were world leaders in renewable energy production and we lagged far behind. Those countries were generating about 20 percent of their energy from renewable sources and Iowa, a mere 4 percent.
Today we stand neck and neck with Europe -- Iowa now generates 20 percent of its power through wind.
But this doesn't mean that our state shouldn't aim for further improvement. Here is where we can learn from Slovenia.
After its European Union acceptance in 2004, Slovenia developed an action plan for renewable energy and reduction of its carbon emissions. Today it aims to achieve 25 percent renewable energy by 2025 while expanding other efforts in energy efficiency.
While Iowans focus largely upon wind for energy, Slovenians look to the sun. Right now, the country generates about 20 megawatts of solar electricity and has a goal of establishing 300 megawatts of solar power by 2020. As we pedaled through urban and rural parts of the country, we saw proof of this in the form of solar collectors (for electricity and hot water) on homes, businesses and public buildings.
(2 of 2)
Slovenia pays for these investments through the use of a feed-in tariff, incentive payments to help consumers and businesses purchase renewable energy systems. And as demand for solar technology has increased, business booms at BISOL, a local manufacturer of photo voltaic systems -- now one of the fastest growing companies in the country.
Iowa can adopt a similar strategy.
We can create consumer and business demand with financial incentives for a new neighborhood based on renewable energy systems. In turn, this will bring new skilled job opportunities to install and maintain systems and then manufacture the technology right here in Iowa.
This is what we have done with our investments in large wind farms. Federal production tax credits have provided the financial incentives, bringing new jobs to install and service the large machines. We also have attracted five wind industry component manufactures to supply this demand and a few thousand well-paying manufacturing jobs. So far, Iowa's foray into the wind market has been a wide success.
With the right kind of state policy and financial incentives, there is no reason we can't create more well-paying jobs and address our need for more renewable solar energy.
And of course we cannot overlook the other major purpose of looking to green energy: protecting the environment and addressing a changing climate.
Just as a changing weather patterns bring more summer flooding to Iowa, Slovenians have witnessed both major flooding events and have had to endure 100-plus mile per hour winds -- phenomena they have never before seen. On top of that, the bark beetle, another newcomer, is ravaging the valuable forests that cover 60 percent of their land.
I had a lot of time to think about our energy future while I rode more than 300 kilometers through Slovenia's spectacular farm-dotted countryside. I came to one major conclusion: we need to keep improving our investments in energy efficiency and renewable energy.
As black crude continues to spew into the Gulf, we know that maintaining the status quo is no longer an option.
Next Page
1 | 2
Joe Bolkcom is a member of the Iowa Senate and the outreach and community education director for the University of Iowa's Center for Global and Regional Environmental Research.
Just days before the United States took to the pitch in a heated World Cup match against Slovenia, my colleagues and I enjoyed a friendly exchange on the small central European nation's soil, in the eighth annual Green Bike Tour.There we found that we could learn from Europe about much more than how to kick a checkered ball -- we could take note of its investments in efficient and renewable energy. And just as the solid performance of Americans turned the heads of soccer aficionados around the globe, the news of Iowa's progress in cleaner energy proved able to impress our Slovenian hosts.
Joined by veteran green bikers, David Osterberg, Ed Woolsey -- and John Moreland and our gracious Slovenian host, Professor Mladen Franko of the University of Nova Gorica -- we had a busy schedule with a series of meetings with government officials, energy experts, renewable energy producers, non-governmental organization leaders, students and university faculty. All in all, we learned a lot about Slovenia's energy efforts and of our own.
Iowa has quickly caught up with our continental neighbors since the 2002 European Green Bike Tour. At that time, Germany, Denmark and Holland were world leaders in renewable energy production and we lagged far behind. Those countries were generating about 20 percent of their energy from renewable sources and Iowa, a mere 4 percent.
Today we stand neck and neck with Europe -- Iowa now generates 20 percent of its power through wind.
But this doesn't mean that our state shouldn't aim for further improvement. Here is where we can learn from Slovenia.
After its European Union acceptance in 2004, Slovenia developed an action plan for renewable energy and reduction of its carbon emissions. Today it aims to achieve 25 percent renewable energy by 2025 while expanding other efforts in energy efficiency.
While Iowans focus largely upon wind for energy, Slovenians look to the sun. Right now, the country generates about 20 megawatts of solar electricity and has a goal of establishing 300 megawatts of solar power by 2020. As we pedaled through urban and rural parts of the country, we saw proof of this in the form of solar collectors (for electricity and hot water) on homes, businesses and public buildings.
(2 of 2)
Slovenia pays for these investments through the use of a feed-in tariff, incentive payments to help consumers and businesses purchase renewable energy systems. And as demand for solar technology has increased, business booms at BISOL, a local manufacturer of photo voltaic systems -- now one of the fastest growing companies in the country.
Iowa can adopt a similar strategy.
We can create consumer and business demand with financial incentives for a new neighborhood based on renewable energy systems. In turn, this will bring new skilled job opportunities to install and maintain systems and then manufacture the technology right here in Iowa.
This is what we have done with our investments in large wind farms. Federal production tax credits have provided the financial incentives, bringing new jobs to install and service the large machines. We also have attracted five wind industry component manufactures to supply this demand and a few thousand well-paying manufacturing jobs. So far, Iowa's foray into the wind market has been a wide success.
With the right kind of state policy and financial incentives, there is no reason we can't create more well-paying jobs and address our need for more renewable solar energy.
And of course we cannot overlook the other major purpose of looking to green energy: protecting the environment and addressing a changing climate.
Just as a changing weather patterns bring more summer flooding to Iowa, Slovenians have witnessed both major flooding events and have had to endure 100-plus mile per hour winds -- phenomena they have never before seen. On top of that, the bark beetle, another newcomer, is ravaging the valuable forests that cover 60 percent of their land.
I had a lot of time to think about our energy future while I rode more than 300 kilometers through Slovenia's spectacular farm-dotted countryside. I came to one major conclusion: we need to keep improving our investments in energy efficiency and renewable energy.
As black crude continues to spew into the Gulf, we know that maintaining the status quo is no longer an option.
Next Page
1 | 2
Joe Bolkcom is a member of the Iowa Senate and the outreach and community education director for the University of Iowa's Center for Global and Regional Environmental Research.
Tuesday, July 6, 2010
Some Say No to Solar Money Grants
Two government-chartered mortgage finance companies are unlikely to accept loans on homes that are part of a special program that lets homeowners repay the cost of energy improvements through a surcharge on their property tax bills, according to Energy Department officials.The Obama administration has allocated $150 million in stimulus money to support the financing technique, called Property Assessed Clean Energy, or PACE, and 22 states have authorized such programs. In a separate stimulus effort, President Obama on Saturday announced nearly $2 billion in loan guarantees for solar energy production.
Through the PACE program, loans to install solar panels and make other energy improvements would be repaid through 20-year special assessments on property tax bills and secured through a lien.
On May 5, Fannie Mae and Freddie Mac, which buy and resell most home mortgages, notified lenders that such liens could not take priority over a mortgage but did not offer guidance on how to handle such loans. The uncertainty has frozen many PACE programs and led some energy companies to furlough workers.
On Friday, Cathy Zoi, an assistant secretary at the Energy Department, called officials in Boulder County, Colo., to inform them that the administration had been unable to persuade the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, to accept mortgages with PACE liens.
The liens, like other property tax assessments, would be paid first if a homeowner defaults.
“She said in light of the circumstances we should look at other ways of financing energy efficiency with the stimulus money,” said Ben Pearlman, a commissioner in Boulder County.
“We’re very concerned,” Mr. Pearlman said. “It’s a powerful program and a powerful idea. We need to find an easy way for people to make those investments.”
Those homeowners who already carry energy liens on their property may find it difficult to refinance their mortgages. In Sonoma County, Calif., some lenders have declined to issue new loans for homes with such liens unless the assessment is paid off.
Ms. Zoi also called Cisco DeVries, president of Renewable Funding, a company in Oakland, Calif., that devises and administers PACE programs for local governments. “She indicated that the agencies had decided not to accept the liens and the administration needed to begin contingency planning on what to do with stimulus funding allocated for PACE,” Mr. DeVries said.
Dan Leistikow, the Energy Department’s director for public affairs, confirmed the calls. “We expect to get more written guidance from the regulators this week,” he said on Saturday.
A spokeswoman for the Federal Housing Finance Agency said it would address the issue soon.
The Energy Department’s action, which was first reported by Grist, an online magazine, comes as Congressional leaders and state officials have been pressing the mortgage agencies to allow PACE programs to proceed.
On Friday, Representatives Henry A. Waxman and Barney Frank sent a letter to top administration officials urging them to act quickly on the issue.
“The response among the cities is something close to outrage,” Mr. DeVries said. “There may need to be a legislative solution, maybe litigation.”
While one energy effort appeared to fizzle over the weekend, the president announced nearly $2 billion in Energy Department loan guarantees for two solar power companies.
Mr. Obama made the announcement on Saturday in his weekly address, a day after an unemployment report showed weak job growth in June and stoked concerns that the nation’s recovery was weakening. He said the companies’ projects would create more than 5,000 jobs, part of a wider push on clean energy.
“That’s one of the reasons why we’re accelerating the transition to a clean energy economy and doubling our use of renewable energy sources like wind and solar power — steps that have the potential to create whole new industries and hundreds of thousands of new jobs,” he said.
Abengoa Solar, a unit of a Spanish company, will receive a $1.45 billion loan guarantee to build a solar plant in Arizona. And Abound Solar of Loveland, Colo., was awarded a $400 million guarantee to expand a solar-panel factory in Longmont, Colo., and to open a factory in Tipton, Ind.
Through the PACE program, loans to install solar panels and make other energy improvements would be repaid through 20-year special assessments on property tax bills and secured through a lien.
On May 5, Fannie Mae and Freddie Mac, which buy and resell most home mortgages, notified lenders that such liens could not take priority over a mortgage but did not offer guidance on how to handle such loans. The uncertainty has frozen many PACE programs and led some energy companies to furlough workers.
On Friday, Cathy Zoi, an assistant secretary at the Energy Department, called officials in Boulder County, Colo., to inform them that the administration had been unable to persuade the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, to accept mortgages with PACE liens.
The liens, like other property tax assessments, would be paid first if a homeowner defaults.
“She said in light of the circumstances we should look at other ways of financing energy efficiency with the stimulus money,” said Ben Pearlman, a commissioner in Boulder County.
“We’re very concerned,” Mr. Pearlman said. “It’s a powerful program and a powerful idea. We need to find an easy way for people to make those investments.”
Those homeowners who already carry energy liens on their property may find it difficult to refinance their mortgages. In Sonoma County, Calif., some lenders have declined to issue new loans for homes with such liens unless the assessment is paid off.
Ms. Zoi also called Cisco DeVries, president of Renewable Funding, a company in Oakland, Calif., that devises and administers PACE programs for local governments. “She indicated that the agencies had decided not to accept the liens and the administration needed to begin contingency planning on what to do with stimulus funding allocated for PACE,” Mr. DeVries said.
Dan Leistikow, the Energy Department’s director for public affairs, confirmed the calls. “We expect to get more written guidance from the regulators this week,” he said on Saturday.
A spokeswoman for the Federal Housing Finance Agency said it would address the issue soon.
The Energy Department’s action, which was first reported by Grist, an online magazine, comes as Congressional leaders and state officials have been pressing the mortgage agencies to allow PACE programs to proceed.
On Friday, Representatives Henry A. Waxman and Barney Frank sent a letter to top administration officials urging them to act quickly on the issue.
“The response among the cities is something close to outrage,” Mr. DeVries said. “There may need to be a legislative solution, maybe litigation.”
While one energy effort appeared to fizzle over the weekend, the president announced nearly $2 billion in Energy Department loan guarantees for two solar power companies.
Mr. Obama made the announcement on Saturday in his weekly address, a day after an unemployment report showed weak job growth in June and stoked concerns that the nation’s recovery was weakening. He said the companies’ projects would create more than 5,000 jobs, part of a wider push on clean energy.
“That’s one of the reasons why we’re accelerating the transition to a clean energy economy and doubling our use of renewable energy sources like wind and solar power — steps that have the potential to create whole new industries and hundreds of thousands of new jobs,” he said.
Abengoa Solar, a unit of a Spanish company, will receive a $1.45 billion loan guarantee to build a solar plant in Arizona. And Abound Solar of Loveland, Colo., was awarded a $400 million guarantee to expand a solar-panel factory in Longmont, Colo., and to open a factory in Tipton, Ind.
Monday, July 5, 2010
Alabama Men Promoting Compressed Natural Gas Vehicles
The Associated Press
ARCADIA, Okla.—Two Alabama men hope their trip down old U.S. Highway 66 encourages people not just to be nostalgic, but to consider what they see as the future of vehicle fuels.
Mark McConville and Keith Barfield of Birmingham are making the 2,450-mile journey from Santa Monica, Calif., to Chicago in a candy-apple red 1966 GTO that's been converted to run on compressed natural gas, or CNG.
The men started what they dubbed as the "Drive to Inspire" on June 27, passed through Oklahoma on Thursday and Friday and plan to finish their trip on July 4.
Their ultimate goal is to win converts to the cause of using CNG as a vehicle fuel in the U.S., where it has yet to significantly catch on as an alternative to gasoline.
ARCADIA, Okla.—Two Alabama men hope their trip down old U.S. Highway 66 encourages people not just to be nostalgic, but to consider what they see as the future of vehicle fuels.
Mark McConville and Keith Barfield of Birmingham are making the 2,450-mile journey from Santa Monica, Calif., to Chicago in a candy-apple red 1966 GTO that's been converted to run on compressed natural gas, or CNG.
The men started what they dubbed as the "Drive to Inspire" on June 27, passed through Oklahoma on Thursday and Friday and plan to finish their trip on July 4.
Their ultimate goal is to win converts to the cause of using CNG as a vehicle fuel in the U.S., where it has yet to significantly catch on as an alternative to gasoline.
Sunday, July 4, 2010
Money More Money $2 Billion from USA for Solar
AN FRANCISCO (MarketWatch) -- U.S. President Barack Obama on Saturday outlined plans to ramp up the number of clean-energy jobs in the U.S., with his administration's goal fueled in part by roughly $2 billion in new conditional commitments to two solar companies.
Abengoa SA (ES:ABG 16.52, +0.32, +1.94%) was offered a $1.45 billion loan guarantee by the U.S. Department of Energy to build a 250-megawatt solar plant in Arizona, and Abound Solar Manufacturing was offered a $400 million loan guarantee toward two plants where thin-solar panels will be manufactured.
The guarantees through the Recovery Act and other measures are expected by the awardees to create more than 5,000 jobs, according to a statement from the White House.Obama during his weekly address said the investments will help the country establish leadership in "cutting-edge" solar technology, and create jobs to aid economic recovery efforts.
A transition to a clean-energy economy and doubling use of renewable-energy sources including wind and solar power "have the potential to create whole new industries and hundreds of thousands of new jobs in America," said Obama in the address.
Obama, in announcing the new energy-related commitments, also took aim at Republicans, saying they are holding up the extension of unemployment insurance for workers without jobs, "a move that only ends up holding back our recovery. It doesn't make sense."
Meanwhile, Georgia Sen. Saxby Chambliss in the GOP's weekly address Saturday said national debt is "one of the most dangerous threats" facing the country as it celebrates another Independence Day.
"At a time when Americans are clipping coupons and pinching pennies, President Obama and the Democrats in Congress continue to spend money that they, we, do not have," said Chambliss, adding that the national debt recently topped $13 trillion.
Energy projects outlined
Abengoa Solar Inc., a subsidiary of Spanish renewable energy and engineering firm Abengoa SA, has agreed to build a solar generation plan near Gila Bend, Ariz. The Solona project will create 1,600 jobs in Arizona and about 85 permanent jobs once the plant is operational, according to Abengoa Solar.
The company said, according to the White House statement, that 70% of the components and products used in the construction will be made in the U.S., and the plant will generate enough to power for more than 70,000 homes at full capacity.
Abound Solar Manufacturing plans to use the loan proceeds to expand its Longmont, Colo. plant. A portion of the proceeds will be used to open a new plant in an empty Chrysler supplier factory in Tipton, Ind.
Abound Solar estimates construction of the plants will 2,000 jobs, with 1,500 permanent manufacturing and technical jobs.
Abengoa SA (ES:ABG 16.52, +0.32, +1.94%) was offered a $1.45 billion loan guarantee by the U.S. Department of Energy to build a 250-megawatt solar plant in Arizona, and Abound Solar Manufacturing was offered a $400 million loan guarantee toward two plants where thin-solar panels will be manufactured.
The guarantees through the Recovery Act and other measures are expected by the awardees to create more than 5,000 jobs, according to a statement from the White House.Obama during his weekly address said the investments will help the country establish leadership in "cutting-edge" solar technology, and create jobs to aid economic recovery efforts.
A transition to a clean-energy economy and doubling use of renewable-energy sources including wind and solar power "have the potential to create whole new industries and hundreds of thousands of new jobs in America," said Obama in the address.
Obama, in announcing the new energy-related commitments, also took aim at Republicans, saying they are holding up the extension of unemployment insurance for workers without jobs, "a move that only ends up holding back our recovery. It doesn't make sense."
Meanwhile, Georgia Sen. Saxby Chambliss in the GOP's weekly address Saturday said national debt is "one of the most dangerous threats" facing the country as it celebrates another Independence Day.
"At a time when Americans are clipping coupons and pinching pennies, President Obama and the Democrats in Congress continue to spend money that they, we, do not have," said Chambliss, adding that the national debt recently topped $13 trillion.
Energy projects outlined
Abengoa Solar Inc., a subsidiary of Spanish renewable energy and engineering firm Abengoa SA, has agreed to build a solar generation plan near Gila Bend, Ariz. The Solona project will create 1,600 jobs in Arizona and about 85 permanent jobs once the plant is operational, according to Abengoa Solar.
The company said, according to the White House statement, that 70% of the components and products used in the construction will be made in the U.S., and the plant will generate enough to power for more than 70,000 homes at full capacity.
Abound Solar Manufacturing plans to use the loan proceeds to expand its Longmont, Colo. plant. A portion of the proceeds will be used to open a new plant in an empty Chrysler supplier factory in Tipton, Ind.
Abound Solar estimates construction of the plants will 2,000 jobs, with 1,500 permanent manufacturing and technical jobs.
Saturday, July 3, 2010
Venzuela Shaking it Up
Trader Jofmar Heredia was thrown out of work when Venezuelan President Hugo Chavez shut the unregulated currency market in May and seized about 40 brokerages, accusing them of setting artificial rates, capital flight and money laundering.
Heredia, 31, said she’s worried she may never find a job at a bank again because of Chavez’s crackdown.
“I’m unemployed and leaving my resume in banks but no one is calling,” said Heredia, who worked at Proinversion Sociedad de Corretaje CA in Caracas. “A lot of my friends in brokerages taken over by the government have been let go.”
The brokerage business is in danger of becoming obsolete in this socialist nation, said Noris Aguirre, a director at the clearing firm Caja Venezolana de Valores. Since November, Venezuela’s securities regulator has taken control of about 35 percent of the 112 trading firms and closed four after they were blamed for the 27 percent drop in the bolivar through May 18. That may leave up to 2,500 without jobs even as Chavez says his biggest economic priority is preserving employment.
Chavez, a 55-year-old former paratrooper who’s been in power for 11 years, says the country doesn’t need such companies and accuses them of exploiting loopholes to become rich. The government banned investment instruments known as mutuos in February -- which are akin to repurchase agreements, or repos -- and prohibited brokers from trading in a new currency market established last month. Securities firms use repos to borrow money to finance positions in bonds and other securities.
Chavez Takes Control
In a speech on May 23 to supporters, Chavez said his country should eliminate brokerages.
“We’re going to respond strongly against these thieves that are trying to wash their hands now,” Chavez said. “There’s no economic reason for the weakening of the bolivar. It’s a huge fraud against the republic.”
The government took control of the country’s largest brokerage, Econoinvest Casa de Bolsa, after raiding it on May 24, arresting four directors and ordering it to cease operations for a week pending an investigation. Of the 420 workers at the company, 126 have resigned, according to the nation’s regulator. The directors are being held at the national intelligence service in Caracas awaiting final charges against them for illegally trading foreign currency and association with delinquency.
Authorities are investigating “irregularities” at Econoinvest and are trying to guarantee the investments of its 44,000 clients, the Finance Ministry said today in a statement.
No Opportunities
Rene Buroz, the lawyer for the directors, declined to comment, as did an Econoinvest public relations official, who asked not to be identified in accordance with company policy.
The government took control of Finalca Casa de Bolsa today for failing to prove the origin of funds and putting its clients’ investments at risk after a raid on June 2, according to a resolution published in the Official Gazette.
Nelson Venero, a 32 year-old accountant, lost his job at the end of May after working for five years in the brokerage industry. After securing a job at AVC Valores Sociedad de Corretaje and a pay raise with a dollar bonus in October, he said he was fired after the government seized the company in May.
“This limits operations so much for brokerages that I don’t see any opportunities for them,” Aguirre of Caja Venezolana de Valores, which helps manage bonds and equities owned by brokerage houses, said in an interview. “They’re allowed to buy and sell company shares, but all of the companies that traded on the stock market have now been nationalized.”
Nationalizations
Chavez nationalized Cia Anonima Nacional Telefonos de Venezuela, the phone company known as Cantv, in 2007 to boost the state’s hold on the economy. The government has also taken over assets from Exxon Mobil Corp., ConocoPhillips, Ternium SA and Mexican cement maker Cemex SAB, which listed on the Caracas Stock Exchange.
The brokerage industry boomed between 2005 and 2010, growing 42 percent to more than 100 institutions, according to the securities regulator. Traders were hired to perform bond swaps as a means of obtaining dollars for companies that failed to receive government authorization to buy at the official exchange rate.
The bond trading set an implicit unregulated rate. That rate plunged to 8.2 per dollar on May 11, seven days before Chavez shut down that market.
‘Destined’
The central bank re-opened the market on June 9, setting the maximum rate and limiting the amount of dollars for purchase. The average rate is now about 5.3 bolivars per dollar. In addition, there are two official exchange rates of 2.6 bolivars per dollar and 4.3 per dollar for imports.
“This was destined to happen,” said Roberto Gonzalez, 39, a former partner at a Caracas-based brokerage who left the firm last year. He declined to identify the company.
Tomas Sanchez, president of the securities regulator known as CNV, said the number of brokerages will likely be cut to less than 20 and that most of the unemployed traders may be able to live off savings since they earned commissions in dollars.
“We know some workers will be affected by this situation but they enjoyed exorbitant benefits and have savings,” Sanchez said in an interview in Caracas on June 9. “Maybe the secretaries and couriers can be incorporated into the public banking system.”
‘Blackmail’
Heredia said that she wasn’t paid in dollars and received a commission of about 10 percent of the value of bolivar transactions.
Raul Maestres, a consultant at Korn/Ferry International, an executive search firm, said their offices in Caracas have been inundated with resumes.
“It’s not the best moment to find work,” Maestres said.
Venezuela’s unemployment rate rose to 8.1 percent in May, from 7.7 percent a year earlier, as the economy slid into the first recession in seven years. Gross domestic product shrank 3.3 percent last year and will likely contract 2.5 percent this year, according to the median forecast in a Bloomberg survey.
Brokers are “not going to blackmail us with the idea that this is going to hurt employment,” Ricardo Sanguino, the president of the congressional finance committee, said in an interview. “Many of them acted outside the law and created more problems than benefits.”
Venero, the unemployed accountant, said that he feels powerless to find work and that he may take a broker course in Panama, where Venezuelan banks have opened branches.
“I don’t think I’ll find work in the capital markets because they’ve been very hard hit,” he said in a phone interview. “A lot of friends are out of work.”
To contact the reporters on this story: Corina Rodriguez Pons in Caracas at crpons@bloomberg.net; Daniel Cancel in Caracas at dcancel@bloomberg.net.
Heredia, 31, said she’s worried she may never find a job at a bank again because of Chavez’s crackdown.
“I’m unemployed and leaving my resume in banks but no one is calling,” said Heredia, who worked at Proinversion Sociedad de Corretaje CA in Caracas. “A lot of my friends in brokerages taken over by the government have been let go.”
The brokerage business is in danger of becoming obsolete in this socialist nation, said Noris Aguirre, a director at the clearing firm Caja Venezolana de Valores. Since November, Venezuela’s securities regulator has taken control of about 35 percent of the 112 trading firms and closed four after they were blamed for the 27 percent drop in the bolivar through May 18. That may leave up to 2,500 without jobs even as Chavez says his biggest economic priority is preserving employment.
Chavez, a 55-year-old former paratrooper who’s been in power for 11 years, says the country doesn’t need such companies and accuses them of exploiting loopholes to become rich. The government banned investment instruments known as mutuos in February -- which are akin to repurchase agreements, or repos -- and prohibited brokers from trading in a new currency market established last month. Securities firms use repos to borrow money to finance positions in bonds and other securities.
Chavez Takes Control
In a speech on May 23 to supporters, Chavez said his country should eliminate brokerages.
“We’re going to respond strongly against these thieves that are trying to wash their hands now,” Chavez said. “There’s no economic reason for the weakening of the bolivar. It’s a huge fraud against the republic.”
The government took control of the country’s largest brokerage, Econoinvest Casa de Bolsa, after raiding it on May 24, arresting four directors and ordering it to cease operations for a week pending an investigation. Of the 420 workers at the company, 126 have resigned, according to the nation’s regulator. The directors are being held at the national intelligence service in Caracas awaiting final charges against them for illegally trading foreign currency and association with delinquency.
Authorities are investigating “irregularities” at Econoinvest and are trying to guarantee the investments of its 44,000 clients, the Finance Ministry said today in a statement.
No Opportunities
Rene Buroz, the lawyer for the directors, declined to comment, as did an Econoinvest public relations official, who asked not to be identified in accordance with company policy.
The government took control of Finalca Casa de Bolsa today for failing to prove the origin of funds and putting its clients’ investments at risk after a raid on June 2, according to a resolution published in the Official Gazette.
Nelson Venero, a 32 year-old accountant, lost his job at the end of May after working for five years in the brokerage industry. After securing a job at AVC Valores Sociedad de Corretaje and a pay raise with a dollar bonus in October, he said he was fired after the government seized the company in May.
“This limits operations so much for brokerages that I don’t see any opportunities for them,” Aguirre of Caja Venezolana de Valores, which helps manage bonds and equities owned by brokerage houses, said in an interview. “They’re allowed to buy and sell company shares, but all of the companies that traded on the stock market have now been nationalized.”
Nationalizations
Chavez nationalized Cia Anonima Nacional Telefonos de Venezuela, the phone company known as Cantv, in 2007 to boost the state’s hold on the economy. The government has also taken over assets from Exxon Mobil Corp., ConocoPhillips, Ternium SA and Mexican cement maker Cemex SAB, which listed on the Caracas Stock Exchange.
The brokerage industry boomed between 2005 and 2010, growing 42 percent to more than 100 institutions, according to the securities regulator. Traders were hired to perform bond swaps as a means of obtaining dollars for companies that failed to receive government authorization to buy at the official exchange rate.
The bond trading set an implicit unregulated rate. That rate plunged to 8.2 per dollar on May 11, seven days before Chavez shut down that market.
‘Destined’
The central bank re-opened the market on June 9, setting the maximum rate and limiting the amount of dollars for purchase. The average rate is now about 5.3 bolivars per dollar. In addition, there are two official exchange rates of 2.6 bolivars per dollar and 4.3 per dollar for imports.
“This was destined to happen,” said Roberto Gonzalez, 39, a former partner at a Caracas-based brokerage who left the firm last year. He declined to identify the company.
Tomas Sanchez, president of the securities regulator known as CNV, said the number of brokerages will likely be cut to less than 20 and that most of the unemployed traders may be able to live off savings since they earned commissions in dollars.
“We know some workers will be affected by this situation but they enjoyed exorbitant benefits and have savings,” Sanchez said in an interview in Caracas on June 9. “Maybe the secretaries and couriers can be incorporated into the public banking system.”
‘Blackmail’
Heredia said that she wasn’t paid in dollars and received a commission of about 10 percent of the value of bolivar transactions.
Raul Maestres, a consultant at Korn/Ferry International, an executive search firm, said their offices in Caracas have been inundated with resumes.
“It’s not the best moment to find work,” Maestres said.
Venezuela’s unemployment rate rose to 8.1 percent in May, from 7.7 percent a year earlier, as the economy slid into the first recession in seven years. Gross domestic product shrank 3.3 percent last year and will likely contract 2.5 percent this year, according to the median forecast in a Bloomberg survey.
Brokers are “not going to blackmail us with the idea that this is going to hurt employment,” Ricardo Sanguino, the president of the congressional finance committee, said in an interview. “Many of them acted outside the law and created more problems than benefits.”
Venero, the unemployed accountant, said that he feels powerless to find work and that he may take a broker course in Panama, where Venezuelan banks have opened branches.
“I don’t think I’ll find work in the capital markets because they’ve been very hard hit,” he said in a phone interview. “A lot of friends are out of work.”
To contact the reporters on this story: Corina Rodriguez Pons in Caracas at crpons@bloomberg.net; Daniel Cancel in Caracas at dcancel@bloomberg.net.
Thursday, July 1, 2010
Irish Electricians Lose High Court Case
The High Court has dismissed a challenge by electrical contractors to the legally-binding system of setting pay and conditions for employees in the sector.
The electrical contractors had argued that the system of Registered Employment Agreements was flawed because not all employers were properly represented in negotiations at the Labour Court to set nationally binding terms and conditions for workers.
If the challenge had succeeded, terms and conditions for hundreds of thousands of workers in other sectors governed by Registered Employment Agreements could have been set aside, leaving them with only minimum employment and minimum wage guarantees.Mr Justice John Hedigan delivered the conclusion to his ruling, which has not yet been fully written up.
He found that the electrical contractors had delayed excessively in taking judicial review proceedings against the Labour Court decision on the Registered Employment Agreements.
He said it was not possible to accept that the contractors had not been aware of the Registered Employment Agreements for the sector, until relatively recently.
He ruled that the Labour Court was within its jurisdiction to decide to proceed with the Registered Employment Agreements.
He rejected claims that the Labour Court had made five key errors of law.
Mr Justice Hedigan declined to consider the constitutional element of the contractors challenge to the Registered Employment Agreements.
He said it should have been brought by plenary proceedings and not by judicial review.
The electrical contractors had argued that the system of Registered Employment Agreements was flawed because not all employers were properly represented in negotiations at the Labour Court to set nationally binding terms and conditions for workers.
If the challenge had succeeded, terms and conditions for hundreds of thousands of workers in other sectors governed by Registered Employment Agreements could have been set aside, leaving them with only minimum employment and minimum wage guarantees.Mr Justice John Hedigan delivered the conclusion to his ruling, which has not yet been fully written up.
He found that the electrical contractors had delayed excessively in taking judicial review proceedings against the Labour Court decision on the Registered Employment Agreements.
He said it was not possible to accept that the contractors had not been aware of the Registered Employment Agreements for the sector, until relatively recently.
He ruled that the Labour Court was within its jurisdiction to decide to proceed with the Registered Employment Agreements.
He rejected claims that the Labour Court had made five key errors of law.
Mr Justice Hedigan declined to consider the constitutional element of the contractors challenge to the Registered Employment Agreements.
He said it should have been brought by plenary proceedings and not by judicial review.
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