Brazilian politicians, judges to advance green agenda
Representatives from Brazil's three branches of government have pledged to work together to advance the country's green agenda by approving legislation, expanding funding and guaranteeing enforcement related to the environment and the energy transition.
Representatives from the supreme court (STF) and congress, together with President Luiz Inacio Lula da Silva and members of his cabinet signed an agreement on Wednesday aimed at reinforcing the country's commitment to protecting the environment.
On the legislative front, lower house speaker Arthur Lira and senate President Rodrigo Pacheco promised to give priority to legislation that will advance the transition to low-carbon energy. This includes legislation that will create a regulated carbon market, a bill regulating offshore wind projects as well as a proposal that will create blend mandates for advanced biofuels.
Pacheco plans to hold a vote for the bill that will create a carbon market in the first half of September, a spokesperson for senator Leila Barros, who is elaborating the text, told Argus. Barros has made significant progress on the new draft of the bill, but is finetuning the final text to address demands from specific sectors of the economy, the spokesperson said.
The senate is also finalizing its analysis of the fuels of the future bill, which will create blend mandates for hydro-treated vegetable oil (HVO) and sustainable aviation fuel (SAF) as well as clear the way to increase the mandatory ethanol and biodiesel blends in commercial fuels. Senator Veneziano Vital do Rego presented a draft of the legislation on 20 August and is working to hold a vote in early September on the bill, which passed the lower house in March.
Legislation for offshore wind has also made progress in the senate, but a proposal has not yet been presented. A draft of the bill was approved by the lower house last year, but included amendments that would expand subsidies for fossil fuels, potentially raising electricity prices for consumers.
As part of the agreement, the executive branch has also promised to make further progress towards guaranteeing financing for energy transition projects. Likewise, the judiciary has agreed to give priority to cases that involve environmental, climate and land ownership.
Lula stressed that the agreement among the three branches of the government shows Brazil's willingness to take a leading role to protect that environment as it prepares to host the Cop 30 meeting in Para state in 2025.
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Indonesia may tighten POME oil export rules: Ministry
Indonesia may tighten POME oil export rules: Ministry
Singapore, 21 August (Argus) — Indonesian exports of palm oil wastes and residues including palm oil mill effluent (Pome) oil may soon be subjected to stricter export regulations, according to a draft document from its trade ministry. The ministry released the draft after a meeting with biofuel feedstock exporters on 20 August. The timeline for a decision on finalising the regulation is still unclear, although some market participants said it could be made by this month. Exports of Pome oil, high acid palm oil residue (Hapor) and empty fruit bunches (EFB) oil under the HS code 2306.60.90 are expected to require export permits, a change from the previous requirement of only export rights. While more details were not disclosed, meeting domestic market obligations (DMO) is usually a prerequisite to get export permits, suppliers said. This means that companies will need to sell a certain amount of cooking oil within Indonesia — or buy export quotas or credits from palm oil refineries around $15-$20/t — before they are able to export these products. This has led to expectations of potentially tightened feedstock exports. Refineries who sell cooking oil volumes to remote areas of Indonesia will also receive higher export quotas. As of January 2023, only crude palm oil (CPO), refined, bleached and deodorised (RBD) palm oil, RBD palm olein and used cooking oil (UCO) were subject to the DMO requirements. The previously-set domestic Highest Retail Price (Harga Eceran Tertinggi or HET) for cooking oil sold to consumers at 14,000 rupiah/l is now Rp15,700/l. This is likely because of higher CPO prices and packaging costs, a Indonesia-based supplier said. But market participants said they were also anticipating this increase previously. The higher HET implies that companies' cost of acquiring export permits in the medium to long term could fall, having sold cooking oil at higher prices domestically, market participants said. DMO for cooking oil Indonesia's Ministry of Trade also issued a regulation on 16 August stating that the DMO scheme for cooking oil will move fully from bulk to packaged palm olein – in 500ml, 1 litre (l), 2l and 5l volumes. This is likely to help maintain stable cooking oil prices and control inflation, as packaged olein is easier to monitor than bulk, a supplier said. The deadline for moving from bulk to packaged volumes is 12 November. Refineries under the DMO must also supply cooking oil volumes domestically of around 250,000 t/month, compared with approximately 300,000 t/month previously. But actual volumes will also depend on factors like how much palm oil wastes and residues exporters want to ship in a particular month too, a supplier said. The draft document did not include updates to long-awaited changes to export duties and levies to POME oil, UCO and other products, market participants said. They were expecting these changes in September or October when the new government is sworn in, although the actual timeline is difficult to determine. Current combined export duties and levies on POME for August is only $10/t, considering a CPO reference price of $820.11/t. UCO is not subject to duties, but have levies of $35/t. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Malaysia’s Petronas achieves first gas at Kasawari
Malaysia’s Petronas achieves first gas at Kasawari
Singapore, 21 August (Argus) — Malaysian state-owned Petronas has started first gas production at the Kasawari field at an initial flow rate of 200mn ft³/d (5.6mn m³/d), the firm announced today. The field is located in Block SK316, approximately 200km off the coast of Sarawak. It contains an estimated 10 trillion ft³ of natural gas resources, with a gas sales rate of 545mn ft/d, according to Petronas. Petronas Carigali, a subsidiary of Petronas, holds a 90pc stake in the Kasawari field and is the operator. Exploration and Production Malaysia Venture (EPMV) holds the remaining 10pc stake. The Kasawari gas field development includes a central processing platform, a flare platform and a wellhead platform, which are all interconnected. Gas from the field is exported to a new riser platform at the E11 production hub through an 81km carbon steel pipeline for further gas delivery to customers in Bintulu, Petronas said. The Kasawari gas field is a crucial feed source for the Petronas LNG complex in Bintulu and in addressing the increasing domestic demand for gas, said Petronas. Carbon capture and storage Petronas is also still looking to develop its carbon capture and storage (CCS) capabilities, including at the Kasawari field, even as it looks to maximise fossil fuel production. The firm on 20 August announced it signed a joint study and development agreement with Abu Dhabi's state-controlled Adnoc and UK decarbonisation firm Storegga, to evaluate the CO2 emission storage capabilities of saline aquifers and construction of CCS facilities in the Penyu basin, offshore peninsular Malaysia. The agreement targets at least 5mn t/yr of CO2 capture and storage capacity by 2030. The scope of the agreement includes a CO2 shipping and logistics study, geophysical and geomechanical modelling, reservoir simulation and containment research while exploring the application of advanced technologies, including artificial intelligence, to enhance storage capacity, Petronas said. Malaysia has a target of net zero emissions by 2050. Petronas is a member of Malaysia's National Energy Transition Roadmap committee, which has identified CCS as one of six energy transition levers to enable the country to be sustainable, low-carbon and resilient. In line with this, Petronas has signed multiple deals with foreign firms to jointly develop CCS projects with Malaysia, including Japanese firms Jera, Mitsui , and Japex . Petronas is also involved in cross-border projects with South Korean firms. Malaysia has a geological abundance of deep saline aquifer reservoirs, which should allow for the development of large-scale, permanent CO2 storage solutions. This latest agreement will significantly accelerate regional deployment of CCS and if successful, will lay the foundations for a regional CCS hub that serves both domestic and international emitters, Petronas added. By Joey Chan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Germany boosts bioenergy role in power
Germany boosts bioenergy role in power
Berlin, 20 August (Argus) — Germany's government is working on new legislation to support the role of bioenergy as a provider of back-up flexibility in Germany's future renewables-based power system, thus giving a new lease of life to thousands of mainly small biogas plants soon falling out of the subsidy system. The federal ministry of economic affairs and climate action this week said it will present a "comprehensive biomass package" which will "substantially" improve the prospects mainly of flexible, co-generating biogas plants. The terms bioenergy and biomass are used interchangeably in Germany. The lion's share of Germany's installed bioenergy capacity is biogas-fired, which is also subsumed as "gaseous biomass". The ministry said with the bulk of Germany's bioenergy plants built between 2004 and 2011, "many" are now nearing the end of the 20-year subsidy period, while the biomass tenders are "massively" oversubscribed. "We recognise these worries," the ministry said. "Thousands" of small plants will be forced off line in the next years, with "hundreds" already facing this situation by the end of this year, renewables association BEE president Simone Peter said yesterday. Under the future biomass tenders, preference will be given to plants connected to a heating grid or a building grid which provides heat for up to 16 buildings. Existing plants will also be able to take part in the new tenders, and will be incentivised to quickly switch to the new model, as this would extend their subsidy period. Flexible power generation will be incentivised by restricting subsidies to "eligible" operating hours. Biogas plants will also see their so-called flexibility surcharge "improved". Industry associations welcomed the ministry's plans, which climate action minister Robert Habeck had aired for the first time in an interview at the weekend. Bioenergy industry association BBE reiterated its demands for a near-doubling of the flexibility surcharge to €120/kW from €65/kW. Running flexibly is a financial and operational challenge for biogas plants, because they cannot simply ramp up and down as, among other things, fermentation would become out of control. Flexibility is only possible by investing in additional capacity: heat storage, biogas storage and/or generation capacity — hence the flexibility surcharge. Over the past few years Germany's bioenergy sector has pushed for bioenergy to be included, and supported, in a future renewables-based power system. Germany's biogas industry has repeatedly stressed that given the necessary investments in flexibility, the current 6GW of biogas capacity could be doubled by 2030 and go up up to 24GW in 2045, without the need for any additional crop input, rendering superfluous most hydrogen peak power plants. The ministry said the new legislation will create "investment security" for the bioenergy sector while also paving the way for the future of bioenergy in the planned capacity market. By Chloe Jardine Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Dutch €1bn green H2 subsidy scheme to open in October
Dutch €1bn green H2 subsidy scheme to open in October
Mumbai, 20 August (Argus) — The Netherlands will accept bids for its €998mn ($1.07bn) scheme to support large-scale renewable hydrogen production plants on 15-31 October. This round aims to support construction of "at least 200MW of electrolysis capacity" and has a budget more than four times larger than a previous subsidy round held last year, for which the successful bidders were announced in April . It was initially announced by Dutch enterprise agency RVO in March and approved by the European Commission in July . A single project can apply to receive a maximum subsidy of up to 50pc of the total amount. The subsidy scheme entails support for up to 80pc of a project's investment costs. It will also cover operating costs, with the latter to be granted for 5-10 years — depending on a project's specific requirements — through a contracts-for-difference mechanism. For the operating subsidies, project developers have to provide their expected renewable hydrogen production costs up to a maximum of €9/kg. The subsidy is then calculated as the difference between this renewable hydrogen cost and the cost of making "grey" hydrogen from natural gas through steam methane reforming. The "grey" production cost will be determined on annual basis by the government. For 2024, it has been provisionally set at €3.8131/kg and the final cost cannot be lower than €1.7997/kg. A final "grey" production cost will be determined by 1 April for each preceding year based on actual costs and market conditions. The cost calculations also take into account the value of guarantees of origin for renewable hydrogen and any revenues or cost savings from greenhouse gas emission allowances from which the project might benefit. Projects will be selected based on their requested investment and operational subsidies, which will be expressed as € per MW of electrolysis capacity. Projects must be completed and start production within five years of receiving the subsidy, although there is a possibility of extending this deadline by up to two years in certain cases. By Akansha Victor Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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