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EU's Hoekstra balances divergent calls on climate

  • Market: Biofuels, Emissions
  • 07/11/24

EU climate commissioner Wopke Hoekstra, nominated again for the role, balanced conflicting calls around climate legislation in a hearing today with members of the European Parliament (MEPs).

Some MEPs were in favour of tougher climate legislation, while others demanded delays to targets. Hoekstra defended key climate energy legislation, including EU CO2 reduction targets for cars and vans, while maintaining a cautious approach on expansion of the EU emissions trading system (ETS) to new sectors.

Hoekstra committed to a 2026 ETS review that touches upon maritime, aviation, municipal waste and negative emissions, in response to a question from German centre-right EPP MEP Peter Liese, who has been a key parliament negotiator for ETS reforms.

"Negative emissions are a cornerstone of making it to net zero. I'll absolutely look into the ramifications, whether this could be included," said Hoekstra, commissioner-designate for climate, net-zero and clean growth. If international efforts to reduce aviation emissions do not deliver, Hoekstra is also open to an ETS that equally impacts EU and international aviation.

Hoekstra underlined the pivotal importance for "predictability" of legislation for industry, referencing certain firms' concern at a 12-month delay to the bloc's deforestation regulation. Hoekstra promised a "dialogue" with the car industry about sticking to CO2 standards for cars and vans and the phase-out, from 2035, of new vehicles with an internal combustion engine (ICE). Hoekstra is "all in" for ensuring the EU car industry's success. But the Dutch politician is reticent about delaying penalties for carmakers that do not meet CO2 standards from 2025.

For biofuels and e-fuels, Hoekstra does not want to change current EU legislation. The EU should not open the "box that was closed" by EU legislation, notably with a 2035 phase-out that only foresees use of the ICE with non-biogenic CO2 neutral fuels. "I feel there is a bright future for biofuels. We need more, particularly in many other domains," he said, equally noting that the EU needs to "focus first and foremost on electrification".

And Hoekstra could give no clear deadline for phasing out fossil fuel subsidies in the EU, but said he would do his best to create transparency on the issue.

Speaking notes prepared in advance of the hearing already indicated a cautious approach to new elements in future climate policy. Hoekstra underlined the need for a "business case" for decarbonisation in agriculture and forestry, mirroring the approach taken by EU agriculture commissioner-designate Christophe Hansen.


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19/02/25

EU draft plan seeks to cut energy costs

EU draft plan seeks to cut energy costs

Brussels, 19 February (Argus) — The European Commission has set out plans to tackle the cost of energy in the EU, warning in a draft document that Europe risks de-industrialisation because of a growing energy price gap compared to global competitors. High energy prices are undermining "the EU's global standing and international competitiveness", the commission said, in a draft action plan for affordable energy, seen by Argus . The plan is expected to be released next week, alongside a clean industrial deal and other strategy documents. Much of the strategy relies on non-binding recommendations rather than legislation, particularly in energy taxation. Officials cite EU reliance on imported fossil fuels as a main driver of price volatility. And they also highlight network costs and taxation as key factors. For taxation, the commission pledges — non-binding — recommendations that will advise EU states on how to "effectively" lower electricity taxation levels all the way down to "zero" for energy-intensive industries and households. Electricity should be "less taxed" than other energy sources on the bloc's road to decarbonisation, the commission said. It wants to strip non-energy cost components from energy bills. Officials also eye revival of the long-stalled effort to revise the EU's 2003 energy taxation directive. That requires unanimous approval from member states. The commission pledges, for this year, an energy union task force that pushes for a "genuine" energy union with a fully integrated EU energy market. Additional initiatives include an electrification action plan, a roadmap for digitalisation, and a heating and cooling strategy. A white paper will look at deeper electricity market integration in early next year. EU officials promise "guidance" to national governments on removing barriers to consumers switching suppliers and changing contracts, on energy efficiency, and on consumers and communities producing and selling renewable energy. More legislative action will come to decouple retail electricity bills from gas prices and ease restrictions on long-term energy contracts for heavy industries. By 2026, the commission promises guidance on combining power purchase agreements (PPAs) with contracts for difference (CfDs). And officials will push for new rules on forward markets and hedging. There are also plans for a tariff methodology for network charges that could become legally binding. Familiar proposals include fast-tracking energy infrastructure permits, boosting system flexibility via storage and demand response. Legislative overhaul of the EU's energy security framework in 2026 aims to better prepare Europe for supply disruptions, cutting price volatility and levels. Specific figures on expected savings from cutting fossil fuel imports are not given in the draft seen by Argus . But the strategy outlines the expected savings from replacing fossil fuel demand in electricity generation with "clean energy" at 50pc. Improving electrification and energy efficiency will save 30pc and enhancing energy system flexibility will save 20pc, according to the draft. The commission is also exploring long-term supply deals and investments in LNG export terminals to curb prices. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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China's GoldWind offers first biomethanol spot cargo


19/02/25
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19/02/25

China's GoldWind offers first biomethanol spot cargo

Singapore, 19 February (Argus) — Major Chinese private-sector wind turbine supplier GoldWind has started offering biomethanol spot cargoes, it announced today at the Argus Green Marine Fuels Conference. The producer is currently offering a spot price of $820/t dob northeast Asia for its biomethanol, GoldWind vice president Chen Shi said at the conference, held in Singapore from 18-19 February. GoldWind is offering a total of around 120,000t of biomethanol with 70pc greenhouse gas (GHG) savings for bunkering from the fourth quarter of 2025 to the second quarter of 2026. The company plans to start up its first biomethanol unit with 250,000t/yr capacity in Xinganmeng, Inner Mongolia, by the end of 2025. The plant will feed on wind power-based green hydrogen and corn straw-based biomass. GoldWind aims to start up its second 250,000t/yr biomethanol unit in late 2026. GoldWind signed a long-term offtake agreement with Danish shipping and logistics firm Maersk in November 2023 to supply 250,000t/yr of biomethanol once it achieves full operations, likely from 2027 onwards. The company secured a second long-term offtake agreement in November 2024 with rival container liner Hapag-Lloyd, also to supply 250,000t/yr of biomethanol from 2027 onwards. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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US to seek 'disapproval' of California tailpipe rule


18/02/25
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18/02/25

US to seek 'disapproval' of California tailpipe rule

Washington, 18 February (Argus) — President Donald Trump's administration is taking a procedural step to enable the Republican-led US Congress to block a California program requiring 100pc of in-state sales of new cars and trucks to be electric, plug-in hybrid and hydrogen models by 2035. The US Environmental Protection Agency (EPA) said it plans to subject its previous approval of the program to "disapproval" under the Congressional Review Act, which could allow a vote to halt the standards without a potential filibuster. Oil groups backed such an approach, hoping to kill off a state program that threatened long-term demand for gasoline and diesel in California and nearly a dozen other states that are following its lead. California's program, called Advanced Clean Cars II, requires 35pc of new vehicles sold in the state in model year 2026 to be zero emission vehicles, rising to 100pc of vehicles by 2035. Under former president Joe Biden, EPA granted federal waivers that authorized the program and a separate California plan for limiting emissions from heavy-duty trucks. The Biden administration said its approval of the waivers were not subject to the Congressional Review Act, which aligned with a formal opinion by the US Government Accountability Office (GAO). But EPA administrator Lee Zeldin, on 14 February, said he would reverse course and "submit" all the waivers for potential disapproval. The prior administration attempted to prevent Congress from having input on an "extremely consequential action", Zeldin said, "and the Trump administration is "transparently correcting this wrong". It remains unclear the pathway for a vote to disapprove the EPA waivers, given the conflicting opinion by GAO, which for years has served as an independent arbiter of what actions Congress could disapprove. But some outside attorneys have argued that once an agency action is made subject to the Congressional Review Act, federal courts would not have jurisdiction to "second-guess" a decision to hold a vote. The US Supreme Court separately plans to hold oral arguments in the coming months on a lawsuit by refiners and biofuel producers that want the ability to sue EPA over its approval of an earlier version of the tailpipe program that runs through model year 2025. A federal appeals court last year said the case could not proceed. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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US court pauses refiner's biofuel case after EPA shift


18/02/25
News
18/02/25

US court pauses refiner's biofuel case after EPA shift

New York, 18 February (Argus) — A US federal appeals court has paused the Environmental Protection Agency (EPA)'s rejection of a refiner's request for exemptions from federal biofuel blend mandates, with relief possible for two more refiners as the US reassesses policy under a new administration. A three-judge panel on the US 5th Circuit Court of Appeals last week granted a request from Calumet's 57,000 b/d refinery in Shreveport, Louisiana, to pause a recent EPA action denying the refinery relief from its 2023 obligations under the federal Renewable Fuel Standard. The stay will remain as the court continues reviewing the legality of EPA's rejection, issued in the waning days of President Joe Biden's administration. Under the program, EPA sets annual mandates for blending biofuels into the conventional fuel supply but allows oil refineries that process 75,000 b/d or less to apply for exemptions if they can prove they would suffer "disproportionate" economic hardship. The Biden administration denied these petitions en masse, though most of these rejections were struck down by courts concerned with the government's reasoning. During his first term, President Donald Trump was more generous with refinery relief, which in turn weighed on biofuel demand and the prices of Renewable Identification Number (RIN) credits at the time. Though the 5th Circuit did not explain its decision, EPA had shifted course after the presidential transition, telling the court earlier in the week that it did not oppose Calumet's request for a stay and that it was reconsidering the refiner's earlier exemption petition. The agency said in other court cases that it would not oppose similar pauses on recently issued waiver rejections affecting Calumet's 15,000 b/d oil refinery in Great Falls, Montana, and CVR Energy's 75,000 b/d refinery in Wynnewood, Oklahoma. EPA's ambivalence makes stays more likely, leaving those refiners with little reason for now to enter the market for RIN credits. The agency still says it "takes no position on the merits" as its review of small refinery exemptions continues but the filings at least suggest the possibility of reversing prior rejections. EPA has not yet signaled a more substantive policy around how it will handle similar small refinery requests, which have piled up in recent months. There were 139 pending petitions covering ten compliance years according to the latest program data. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Early RD investment helps refiners weather uncertainty


18/02/25
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18/02/25

Early RD investment helps refiners weather uncertainty

Houston, 18 February (Argus) — Major conventional refiners are confident their early investment in renewable diesel will help ease their transition from the long-running biofuel blenders' credit to a new producers' credit, given the lower value they can capitalize on and potential objectives of the new US administration. These major refiners — including Chevron, Valero, Phillips 66, and Marathon Petroleum — have greater access to capital than smaller producers and have shown they can scale even in an uncertain policy environment. They are focusing on lower carbon intensity feedstocks that will garner greater incentives this year. At the same time, the industry has gradually shifted from a focus on biodiesel to renewable diesel. Renewable diesel generates more value from federal Renewable Identification Number (RIN) credits, is made more often from lower carbon intensity feedstocks like beef tallow and used cooking oil, and can be blended or substituted at higher rates than biodiesel. Refinery tooling needed for the production of renewable diesel is also much closer to that of a conventional crude-oil fed refinery, meaning that refiners looking to repurpose refining assets have an easier path to entering the renewable fuels space. As a result, major refiners across the industry have invested more heavily in renewable diesel in recent years. Marathon Petroleum chief commercial officer Rick Hessling alluded to policy uncertainty on an earnings call this month but said the company's 48,000 b/d California renewable diesel facility was well prepared to weather the storm. "We will control what we can control, and from a feedstock optimization perspective, we're procuring advantaged feedstocks with low [carbon intensities] and then placing them, as you would certainly expect us to, in the highest-margin market as possible," he said. Underscoring the advantage renewable diesel has over biodiesel, Chevron — after idling multiple biodiesel plants last year — also announced the final commissioning of the renewable diesel expansion at its Geismar, Louisiana, facility this month. The transition from biodiesel to renewable diesel within its portfolio opens up greater opportunities for monetization of the new biofuel producers' credit, also known as 45Z, since the facility has greater access to lower-carbon feedstocks than its landlocked biodiesel plants. In general, biodiesel facilities rely more on local vegetable oils for feedstock, which are disadvantaged under the new 45Z credit's larger subsidies for lower-carbon fuels. Over the last six months, biodiesel production facilities owned by Delek, Hero BX, and Renewable Biofuels have idled production or entered prolonged maintenance in the wake of credit uncertainty, according to latest Argus estimates. Especially given lower 45Z credit values this year, these producers have to rely on the generation and monetization of RIN credits to balance the costs of feedstock inputs. When policy shifts like tariffs and limits on the use of certain feedstocks disconnect RIN values from feedstock costs, it can add even greater headwinds that only larger, well-positioned producers can handle. Given President Donald Trump's objectives within the energy space, the 45Z tax credit,under the Inflation Reduction Act (IRA), and other biofuel policy incentives exist in somewhat of a contradiction. Trump has made clear he wants to scale back distribution of IRA funds and has gone as far as calling investment in decarbonization "wasteful" and "a scam." But his support base and platform favor major oil refiners in their quest to maximize output and profit in the name of energy security and job creation. The 45Z credit, which adds a protectionist spin to renewable fuel production by cutting off eligibility for imported fuels, would seem to align with Trump's focus on energy dominance. Major oil and gas companies expanding renewable fuel production and increasingly outcompeting smaller and foreign rivals only add to that narrative. By Matthew Cope Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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