Sitting in the less fashionable end of Richmond – too close to the Roehampton border for the good of one’s social standing – and thoughts turn to the change of seasons and an anticipated uptick in market activity.

There’s a scent of change in the air (for IJ as well as the market) as the clutch dips, rev counter leaps towards the red, and slam into the next gear for the final months of 2024.

For IJ, we’ve spent the summer getting the house in order for change (there’s a lot on the cards) and analysing the market… as well as breaking daily news (obvs). But enough about us. What do the autumn months have in store for us?

If you go by the IJ analysis for the first half, it’s fair to assume that oil and gas projects will continue at pace (investment tip: water-based orange paint manufacturers)… balanced out by energy transition and telecoms.

PPP’s dead in the water apart from irregular heartbeats to give a glimmer of hope, but with little sign of brain activity; the traditional power generation sector is forging ahead (everyone loves a cheeky peaker); and transport remains a constant.

Chatting with folk around the market this week, the consensus is that the summer lull is on the wane and we’re ramping up to “the usual pre-Christmas mayhem” with one old infra chum saying: “Q4 is gearing up to be a frenzy of deal activity across the spectrum.”

Yes, it’s business as usual (don’t you just hate people saying BAU?) as the market pitches headlong into the final quarter of the year to close deals before the Christmas silly season.

It matters not which direction you turn, industry sages (and those who repeat what they say) will tell you – free for the asking – that it’s all about energy transition. And it’s hard to disagree.

Hydrogen continues to divide audiences. It makes so much sense in so many instances. Boden Green Steel Plant in Sweden is a glorious example of hydrogen being a no-brainer. Any project that has an offtake agreement in place is a little below that on the sensible scale. Any project that’s looking for finance, but doesn’t have an offtake agreement in place… tread carefully.

One source – while saying that hydrogen is “the sexiest thing around” caveats that with a dark warning over there being “lots of headwinds”, primary among them being the “cost of green hydrogen and underdeveloped policy support”.

Another infrastructure veteran has a darker view of the hydrogen scene saying that it was likely to take up a lot less time than had previously been the case “not because the bubble will burst, more because it never inflated in the first place”.

There’s a lot of chat about new technologies in the energy transition space, and quite right too.

Earlier this summer, IJGlobal wrote about a fascinating project being driven by Highview Power in the UK. This one is truly a corker – to finance the country’s first commercial-scale liquid air energy storage (LAES) plant in Carrington, Manchester.

This involved the raise of £300 million ($383m) with the UK Infrastructure Bank (UKIB) doing the heavy lifting alongside Centrica and a slew of investors that include: Rio Tinto, Goldman Sachs, Mosaic Capital and KIRKBI – part of the Kirk Kristiansen family’s investment company (the LEGO brand).

This is definitely a technology worth keeping an eye on… and there’s word of another project in the offing… which we can realistically expect to be bigger than the Carrington facility.

Switching back to a more established technology – EV charging – a worrying development is that the market seems to be cooling on this front. One infra lender bemoans this week: “EV charging is out as no-one buys EVs  anymore.”

Ouch. That hurt.

So, if hydrogen is popular in specific circumstances; new technologies (Highfield Power, for example) are all the rage, but have to be equity financed in the first instance to prove themselves (which is fair); and EV charging seems to be moving into Death of a Salesman territory… what does that leave?

Well – without going into an exhaustive list (which would be dull) – biogas seems to be getting the thumbs up. As one infra lag said this week: “Biogas is in. Not too stinky as an investment anymore given all the incentives available… but still literally stinking.”

You can batch that in with sustainable aviation fuel (SAF) which is going to be massive. European Union targets mandate that in fuel uplift at EU airports must contain at least 2% SAF. That will increase gradually and by 2030 it will need to have hit 6%, rising to 20% by 2035, and eventually 70% by 2050. These requirements will apply to all flights originating in the EU, regardless of destination.

Under the current administration, the US has set a target of 100% SAF by 2050. Now that’s going to take a lot of investment.

IJ sister title AirFinance Journal reported earlier this year that the International Air Transport Association (IATA) forecasted a tripling of SAF production in 2024 to 1.9 billion litres (1.5m tonnes) which would account for 0.53% of aviation’s fuel needs this year.

With that in mind, as AFJ points out, the requirement to invest is massive and the carrot/stick approaches by different markets is not helping to deliver the desired results.

But no matter what, the infra community is going to be hard pressed to drive forward projects, push through financing and get them operational to the extent required to hit next year’s targets.

Shiny new things are on the horizon. But all that glisters is not gold.

As one infra lender says: “It will be interesting to see which technology or proposition will make the cut and become something that banks can finance. Think battery energy storage systems (BESS) a few years ago as a pure equity play and now as an infrastructure play financed by banks.”

But for now, it’s the final working day in August and this infra hack is dusting off the keyboard to resume more regular Friday Emails, mulling an evolving market in the coming months and years.

Evolve or die.

Evolve and possibly die.

But evolution is an unstoppable juggernaut.