Guidelines of the Carbon Principles

 

Carbon Principles

Eric Fornell, vice president of investment banking and capital markets at Wells Fargo Securities, advises clients in the energy and utility industries. As one of the negotiators of the Carbon Principles, Eric Fornell worked with large banks and environmental groups to establish guidelines for financing coal-fired power generating plants.

The Carbon Principles focus on reducing carbon emissions by encouraging energy efficiency, renewable sources, and low carbon energy technologies. Banks who sign the principles agree to encourage clients to invest in cost-effective renewable energy solutions as well as support regulatory changes that remove barriers to such investments.

Three clear commitments that take into account the value of avoiding carbon emissions are laid out in the principles. They include encouraging clients to consider low carbon energy alternatives, evaluating the risk of financing fossil fuel generation, and educating others in the financial and energy industries regarding the additional diligence necessary in the financing of fossil fuel generation.

Hands on Learning at the Green Vale School in Long Island, New York

Green Vale School
Image:greenvaleschool.org

 

Eric Fornell serves as vice chairman of investment banking at Wells Fargo Securities in New York, New York. He advises on financial matters, primarily using his expertise to serve clients in the energy and utility sectors. Additionally, Eric Fornell sat on the board of the Green Vale School on Long Island for more than a decade.

The Green Vale School is a co-ed, nonreligious, independent day school in New York. It was created almost 100 years ago by parents who sought to provide a peerless education that would serve its students for the rest of their lives. As part of the school’s commitment to true excellence, it boasts class sizes as small as eight in the younger grades, and 13 to 16 in the upper forms.

In addition to a rigorous academic curriculum, Green Vale students have the opportunity to participate in a variety of enriching hands-on learning activities. Students have access to education in the arts and theater, and there is even a wood shop.

In the woodworking studio, students as young as second graders can learn the basics of woodworking. They practice safety skills and complete projects like wooden puzzles and beautiful model sailboats.

NextEra Energy’s Strategic Acquisition of NET Midstream Texas Pipeline

NextEra Energy Partners
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Eric Fornell is a longtime New York investment banking executive who serves as vice chairman at Wells Fargo Securities. He provides strategic advisory services in both the energy and utility industries. In August, 2015, Eric Fornell and Wells Fargo acted as advisors in a major acquisition by the solar and wind power generator NextEra Energy Partners LP (controlled by NextEra Energy Inc.).

The $2.1 billion transaction involved the purchase of closely held NET Midstream and added seven Texas natural gas pipelines to the firm’s portfolio. It significantly added power plant fuel sales capacities, with an end market in Mexico under a 20-year Pemex ship-or-pay contract.

The scope of assets acquired encompassed 3 billion cubic feet per day of Texas shale gas production and an Eagle Ford formation pipeline. For NextEra Energy Partners, it marks a broadening of business activities from renewable-energy power assets into pipelines. One strategic reason behind the transaction involves sustained Mexican natural gas demand increases, as well as a declining domestic Mexican natural gas supply.

American Banks Send Experienced Representatives to Canada

Canada

 

Eric Fornell is vice chairman of investment banking and capital markets for Wells Fargo Securities. From his base in New York City, Eric Fornell has been instrumental in expanding the company’s investment banking efforts into Canada.

A story published in the Toronto Globe and Mail portrayed Fornell as experienced in his field and able to avoid potential problems in business situations through capable dealings. The article described Fornell as “a veteran U.S. banker” who skillfully “stick-handled the file” when working to advise TransCanada Ltd. on acquiring the Columbia Pipeline Group.

American banks have increasingly begun to push into Canada, peddling their lending capabilities, and have won some of the choicest merger-and-acquisition contracts available in that country. But according to the Globe and Mail article, it takes more than their lending power to win Canadian business. Wells Fargo’s experience in handling companies looking to make hard-asset acquisitions has been helpful, and having experienced representatives like Fornell on hand who are well-versed in the peculiarities of companies they are working with can be just as essential.

Big Banks Develop Carbon Principles to Protect Nature and Investments

Carbon Principles
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Eric Fornell develops financial strategies for Wells Fargo Securities as the company’s vice chairman of investment banking and capital markets. Formerly the vice chairman of JPMorgan Chase, Eric Fornell was involved in the creation of the Carbon Principles.

The Carbon Principles are environmental guidelines put in place by three top Wall Street banks. Citigroup, JPMorgan Chase, and Morgan Stanley came together in 2008 to meet about climate change, environmental responsibility, and the roles that financial institutions should play in protecting the environment.

The principles include strict environmental standards for coal-burning power plants and similar environmental threats. Projects that do not meet these standards will not receive financing from the three banks, creating tremendous pressure to design clean plants or refrain from new construction altogether.

The Carbon Principles grew out of a time of political uncertainty. Congress was considering various bills to roll out new environmental regulations. Financial institutions had little guidance regarding possible changes, and did not want to risk losing money on plants that would not conform to standards. The principles allowed banks to create clear, consistent guidelines.

The Carbon Principles

Carbon Principles
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In 2012, Eric Fornell became vice chairman of investment banking and capital markets at Wells Fargo Securities. During his time with JPMorgan Chase, Eric Fornell played a part in the negotiation of the Carbon Principles, a 2008 agreement between Citi, JP Morgan Chase, and Morgan Stanley, as well as two environmental non-governmental organizations.

The Carbon Principles were a set of climate change guidelines made for advisors and lenders to power companies in America. The principles were created over nine months to evaluate and address carbon risks that may arise in the financing of electric power projects. The three banks consulted several leading power companies, including American Electric Power and CMS Energy, to help create these principles. The Carbon Principles marks the first time that an effort like this one had been made between banks and environmental groups for the benefit of both the environment and the companies involved.

The Carbon Principles include doctrines regarding energy efficiency, renewable and low carbon distributed energy technologies, and conventional and advanced generation. Officials representing major companies in the power industry have made positive remarks about these principles, recognizing the importance of protecting the environment and limiting carbon emissions.

Carbon Principles – Understanding Carbon Risks in Power Investments

Carbon Principles
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Financial professional Eric Fornell has worked on a variety of projects throughout the United States and Canada as part of his banking career. Eric Fornell helped to negotiate the Carbon Principles, an agreement among Citi, JP Morgan Chase, and Morgan Stanley, and a handful of the world’s most influential power companies. Several environmental groups, including Environmental Defense and the Natural Resources Defense Council, were also involved in the process.

The Carbon Principles agreement marks the first time that power companies and financial institutions have come together to understand and respond to carbon-related risks in power investments. The Carbon Principles include energy efficiency, renewable and low carbon distributed energy technologies, and conventional and advanced generation.

This collaboration between carbon companies and banks was designed to positively impact the ways in which financial institutions finance coal-fired power plants. Additionally, the agreement is meant to encourage investing in safe, affordable, and widely available sources of energy in a manner that assists with job growth.

More information about the Carbon Principles is available here: www.morganstanley.com/press-releases/leading-wall-street-banks-establish-the-carbon-principles_6017

NextEra Energy Partners Completes Acquisition of NET Midstream

NextEra Energy Partners
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At Wells Fargo Securities, Eric Fornell serves as vice chairman of investment banking and capital markets, where he is dedicated to the energy and power sector. An industry veteran with over 30 years of experience, Eric Fornell played a role as financial advisor in an acquisition made by one of Wells Fargo Securities’ clients, NextEra Energy Partners.

NextEra Energy Partners (NEP) manages and owns clean energy projects throughout North America and has natural gas projects in the state of Texas. On October 5, 2015, NEP completed an approximately $2.1 billion acquisition of NET Midstream. NET Midstream is an owner-operator of seven natural gas pipelines in Texas. With the NET Midstream purchase, NEP is looking to strengthen its presence in the natural gas pipeline space.

In addition to the NET Midstream acquisition, NEP announced the concurrent procurement of Jericho Wind Energy Center in Ontario, Canada. These businesses play an important role in NEP’s long-term growth strategy.

Investment Banking 101: M&A Advisory Services

A successful financial executive with considerable experience, Eric Fornell serves as vice chairman of investment banking with Wells Fargo Securities in New York City. Throughout his career, Eric Fornell has conducted extensive work in the field of M&A (mergers and acquisitions) advisory service, which represents one of the primary focus areas of investment banking.

At the most basic level, the M&A advisory service provided by investment banks relates to areas such as pricing and structuring of transactions, negotiation, and business valuation. Sell-side engagement refers to an investment bank advising a potential seller, while buy-side engagement, as the name implies, involves advice given to a potential buyer. In both cases, investment banks perform in-depth analyses involving issues such as accretion and dilution, as well as “fairness opinions,” which shed light on the financial environment of a prospective transaction. Investment banks may also advise clients on joint ventures and less-common transactional matters, such as hostile takeovers and takeover defense.

An Overview of the Carbon Principles

An experienced financial executive, Eric Fornell serves as vice chairman of investment banking and capital markets at Wells Fargo Securities, where he focuses much of his work on the energy and power sector. Eric Fornell’s past activities include serving on the Secretary of Energy’s National Petroleum Council and playing a key role in negotiating the Carbon Principles.

Established in 2007, the Carbon Principles are a set of guidelines designed to help banks assess the risks associated with providing financial support to new coal-fired power plants. Institutions that have adopted the principles and their accompanying Enhanced Diligence Process commit to taking a portfolio approach to energy investment, prioritizing renewables and energy efficiency, and addressing the future cost of CO₂ emissions in their financing.

The principles were developed through a partnership with several leading financial institutions, power companies, and environmental groups. The organizations involved in their creation included Citigroup, JPMorgan Chase, Morgan Stanley, American Electric Power, CMS Energy, and the National Resources Defense Council.