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NRG to suspend carbon capture operations at Petra Nova

  • Market: Coal, Electricity, Emissions, Natural gas
  • 23/09/20

US merchant generator NRG Energy plans to suspend operations at the Petra Nova carbon capture coal unit in Texas late this year and will instead run an attached cogeneration facility on a seasonal basis.

NRG plans to mothball the facility, which is at its WA Parish plant near Houston, Texas, beginning 20 December and run it from just 1 June-30 September, according to a notice posted this week by the Electric Reliability Council of Texas (ERCOT).

The plant's carbon capture operations have been in a reserve shutdown status since May because low oil prices brought by the Covid-19 pandemic made it uneconomical. That status allowed the $1bn facility to be idled but available to ERCOT for generation if necessary or if economic conditions improved.

NRG said last month it will continue to make the 78MW natural gas cogeneration facility that is also at the WA Parish plant available to ERCOT for generating purposes.

NRG and ERCOT could not be reached for comment.

Petra Nova, a joint venture between NRG and global oil and gas company JX Nippon, was brought on line in late 2016. It captures CO2 emissions from the WA Parish coal plant and transports by pipeline to an oil field, where it is injected into mature reservoirs to release more oil.

The project was the only one in the US that was capturing carbon dioxide from a coal-fired electric power plant.


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09/04/25

Trump coal plant bailout renews first term fight

Trump coal plant bailout renews first term fight

Washington, 9 April (Argus) — President Donald Trump's effort to stop the retirement of coal-fired power plants is reminiscent of a 2017 attempt that faltered in the face of widespread industry opposition. Trump, in an executive order signed on Tuesday, directed the US Department of Energy (DOE) to tap into emergency powers to stop the retirement of coal-fired plants and other large plants it believes are critical to grid reliability. The order sets a 30-day deadline for DOE to decide which plants are critical based on a new methodology that will analyze if reserve margins, or the percent of unused capacity at peak demand, are at an "acceptable" level. The initiative shares similarities to Trump's unsuccessful effort in his first term to bail out coal and nuclear plants. In the 2017 effort, Trump backed a "grid resiliency" proposal to compensate power plants with 90 days of on-site fuel. But an unusual coalition of natural gas industry groups, manufacturers, renewable producers and environmentalists united against the idea, warning it would upend power markets and cost consumers billions of dollars each year. The US Federal Energy Regulatory Commission voted 5-0 to reject the proposal. It remains unclear if a similarly sized coalition will emerge to fight Trump's latest proposal, under which DOE would use emergency powers in section 202(c) of the Federal Power Act to keep some coal plants and other large power plants operating. Industry groups have largely been avoiding taking positions that could be seen as critical of Trump. Environmentalists say they strongly oppose keeping coal plants operating using emergency powers. Doing so would mean more air pollution and greenhouse gas emissions, they say, and higher costs for consumers. Environmental groups say they are hoping other industries affected by the potential bailout will eventually speak out against the initiative. "The silence from those who know better is deafening," Center for Biological Diversity climate law institute legal director Jason Rylander said. "I hope that we will start to see more resistance to these dangerous policies before significant damage is done." DOE said it was "already hard at work" to implement Trump's executive order, which was paired with other orders that were meant to support coal mining and coal production. US energy secretary Chris Wright said today that reviving coal will increase the reliability of the electrical grid and bring down electricity costs, but he has not shared further details on the 202(c) initiative. Trying to litigate the program could be "tricky", and section 202(c) orders have never successfully been challenged in court, in part because they are usually short-term orders, Harvard Law School Electricity Law Initiative director Ari Peskoe said. But opponents could challenge them by focusing on "numerous legal problems", he said, such as not allowing public comment or running afoul of a US Supreme Court precedent that prohibits agencies from attempting to decide "major questions" without clear congressional authorization. "Here DOE would use a little-used statute explicitly written for short-term emergencies in order to PREVENT a change in the US energy mix," Peskoe said. A projected 8.1GW of coal-fired generation is set to retire this year, equivalent to nearly 5pc of the coal fleet, the US Energy Information Administration said last month. Electric utilities often decide which plants to retire years in advance, allowing them to defer maintenance and to forgo capital investments in aging facilities. Keeping coal plants running could require exemptions from environmental rules or pricey capital investments, the costs of which would likely be distributed among other ratepayers. 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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What do tariffs mean for the global gas market?


09/04/25
News
09/04/25

What do tariffs mean for the global gas market?

Some countries are considering retaliatory tariffs, while others hope to reduce their trade deficit in order to negotiate lower rates London, 9 April (Argus) — Newly announced US tariffs on goods entering the country and some of the countermeasures already announced by large trade partners are unlikely to cause any direct disruptions to global gas markets. But the indirect effects on gas supply and demand may be huge, stemming from a weaker macroeconomic outlook, fuel substitution and inflationary pressures on infrastructure development. US president Donald Trump on 2 April imposed a minimum 10pc tax on all foreign imports from 5 April,with much higher tariffs on selected countries that briefly came into force on 9 April, before Trump announced a 90-day pause. China is the only exception. It has announced retaliatory tariffs that could disrupt US energy exports, resulting in an escalation that has already brought up the respective levies to 125pc in the US and 84pc in China. These are unlikely to have any direct impact on LNG trade flows, as China had already stopped importing US LNG earlier this year. But disruptions to trade between the world's two largest economies may weigh heavily on manufacturing activity in China, in turn reducing industrial gas demand. And the ripple effects of disruptions to US LPG exports to China may alter fuel-switching economics in the region and beyond. Most other countries in Asia-Pacific have opted not to follow China's lead by retaliating against US tariffs, even though many have warned about the potential for long-term economic disruption. The Japanese government intends to negotiate a better tariff deal and is considering investing in the US' proposed 20mn t/yr Alaska LNG export project as part of wider efforts to reduce its trade surplus with the US. Countries in Asia-Pacific have been hit with some of the highest of Trump's targeted duties. The EU is keeping retaliatory measures on the table, but these are unlikely to include any levy on US LNG. Europe has become much more reliant on LNG imports after losing the bulk of its Russian pipeline supply, and imposing tariffs on energy imports would only reignite inflationary pressures that European countries have tried to curb over the past three years. The bloc says it is ready to negotiate on possibly increasing its US LNG imports to reduce its trade surplus and would zero out its tariffs on industrial imports if the US agrees to do the same. But Trump says this offer is not enough, citing the EU's upcoming Carbon Border Adjustment Mechanism as one of the "unfair trade practices" that justifies a tariff response. Nerves of steel Much greater risks for gas markets may stem from rising infrastructure costs in the US' upstream and midstream sectors, particularly as a result of earlier tariffs imposed on steel and aluminum imports. These present an immediate risk for US LNG developers, particularly for the five projects under construction and the six others expected to reach final investment decisions this year. Metals account for up to 30pc of the cost of building an LNG export plant. An LNG terminal can cost $5bn-25bn to build, depending on its size, with steel used for pipelines, tanks and other structural frameworks. US facilities can be built using some domestic metal, but higher prices for this may lead to construction and final investment decision delays for the country's planned liquefaction projects. US tariffs' primary effect on the domestic gas market stems from duties levied on non-energy goods used by the oil and gas industry, including steel and specialised pipeline components such as valves and compressors, which are imported from overseas. The US remains a net natural gas importer from Canada , but these flows are unlikely to be affected by trade tariffs given the lack of alternative supply sources available to some northern US states. US LNG project pipeline mn t/yr Project Capacity Expected start/FID Under construction Plaquemines 19.2 2025 Corpus Christi stage 3 12.0 2025 Golden Pass 18.1 2026 Rio Grande 17.6 2027 Port Arthur 13.5 2027 Waiting for final investment decision Delfin FLNG 1 13.2 mid-2025 Texas LNG 4.0 2025 Calcasieu Pass 2 28.0 mid-2025 Corpus Christi train 8-9 3.3 2025 Louisiana LNG 16.5 mid-2025 Cameron train 4 6.8 mid-2025 Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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German coalition negotiations come to an end


09/04/25
News
09/04/25

German coalition negotiations come to an end

London, 9 April (Argus) — Germany's centre-left SPD and centre-right CDU parties announced a final coalition agreement today, which includes some changes to energy policy. The parties still need to sign off on the agreement. The SPD will ask its members to vote on the text, which it expects could take about 10 days. And the CDU plans to hold a small party conference on the topic at the end of this month, meaning that the new government could be sworn in by early May. The coalition still plans to abolish the gas storage levy "for all" as part of its plan to lower energy prices for households and industry. And the parties plan to introduce "suitable instruments" to ensure gas storage filling to safeguard security of supply in a "more cost-effective" way. There is a large focus on lowering energy prices for industry in the hope of turning the tide on Germany's continued industrial slump, for example through lower electricity taxes, a cap on power grid fees and special relief for energy-intensive industries "otherwise not reached by subsidy plans". The government plans to "make possible and flank diversified, cheap long-term gas contracts with international suppliers" and "use potentials of conventional domestic gas production". And while the government is "examining strategic state holdings in the energy sector, also with grid operators", it will reduce its shares in Uniper and SEFE — which it had acquired in the gas crisis in 2022 — to "strategic shares". The state needs to sell down its stake in the two companies by 2028 but will probably retain a minority share, with the EU allowing a maximum 25pc plus one share, energy ministry officials previously said . Support for gas-fired power The parties reiterated their commitment to encourage the buildout of up to 20GW of dispatchable power generation capacity, with no apparent requirement for the plants to be hydrogen-ready. The parties plan to put forward a bill to allow carbon capture and storage for hard-to-abate emissions from industry as well as gas-fired power plants "immediately after the beginning of the new parliament". The coalition said that the timing of the coal phase-out "has to be judged on how quickly it is achieved to build out dispatchable gas-fired capacities", but it still commits to ending coal burn by 2038. The government reiterated its plan to use grid reserve capacity to stabilise power prices rather than only to stabilise the grid during supply shortages. Associations have warned about the implications of letting grid reserve plants participate in the open market on investment incentives for new generation capacity. It also remains unclear how long it would take to get Brussels' approval for a new subsidy scheme for dispatchable power generation capacity, given that the EU approved the outgoing government's power plant strategy only after lengthy negotiations. Heating sector plan thin on detail The future of Germany's heating law remains unclear in the coalition agreement. The coalition agreement keeps the CDU's standpoint that the outgoing government's buildings energy act will be "abolished", which the SPD had not agreed with in the negotiation documents. But the parties said that a new buildings energy act will be more technology neutral and flexible, indicating that there will still be some legislation to reduce carbon intensity of the built environment. The parties propose a "reachable greenhouse gas avoidance" as the key variable of a new policy, instead of the percentage of renewable energy used in the system as under the existing law. This could end up supporting gas-fired over oil-based heating or providing an incentive to replace older gas boilers with newer models. But the government plans to retain subsidies for new heating systems and insulation measures, which provide large incentives for the uptake of heat pumps. Heat pump industry association BWP welcomed this commitment, combined with a pledge to reduce power prices by about €0.05/kWh, saying that these are "clear signals of an improvement in the framework conditions for the industry". The final coalition agreement again contains a reference to a possible green gas quota , which could support gas-based heating systems, for example through biomethane or hydrogen which could be used to fulfil the quota. The parties said today that they would work out a "roadmap for de-fossilised energy sources" and that it is important to "preserve gas grids which are important for a secure heat supply". By Till Stehr Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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EU states propose 10pp flexibility on EU gas storage


09/04/25
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09/04/25

EU states propose 10pp flexibility on EU gas storage

London, 9 April (Argus) — EU member states have put forward a fourth working draft of proposed amendments to the bloc's gas storage regulations, introducing leeway for a deviation of up to 10 percentage points (pp) from the 1 November target. The new document builds on the previous version of proposed amendments published in late March , and goes further with flexibility allowances for member states by introducing the possibility of deviating by up to 10pp from the 90pc 1 November target in case of "unfavourable market conditions, such as indications of possible market manipulations, or of trading activities hindering cost-effective storage filling, that significantly limit the ability to ensure that the gas storages are filled in accordance with this regulation". The previous version of proposals had only allowed for a 5pp deviation. The flexibility would also be extended to member states with derogations, with the five countries who have a 1 November target equivalent to 35pc of annual consumption having an allowed deviation of 3.88pp, while countries without their own storage who are obliged to store 15pc of average annual consumption abroad may deviate by 1.66pp. The previous clause stating that Germany and Austria must share responsibility for filling the cross-border facilities of Haidach and 7Fields would be replaced by a new clause instead specifying that Slovakia and the Czech Republic will share joint responsibility for filling the Dolni Bojanovice facility on the latter's territory, which has since April begun operating as a cross-border storage. The two states must decide on the ratio of filling responsibilities based on a bilateral agreement between them. The intergovernmental agreement between Germany and Austria on the filling of Haidach and 7Fields expires at the end of 2025. Intermediary targets, referred to as the ‘filling trajectory', would also explicitly be made "indicative" only, while the 1 November target, referred to as the ‘filling target', could instead be reached at any point between 1 October and 1 December. Once 90pc is reached in this period, it does not need to be maintained afterwards. These terms are consistent with the previous version from late March. Other important changes also remain the same as those previously proposed. One amendment allows a further 5pp leeway on top of the 10pp already allowed if a member state's gas production exceeds annual consumption over the previous two years, or if "specific technical characteristics" of an individual facility above 40TWh of capacity located on its territory require a "slow injection rate" causing an "exceptionally long" injection period of more than 115 days. The only storages above 40TWh are Germany's Rehden and the Netherlands' Norg and Bergermeer, while Denmark is the only country that nears having larger production than consumption, although the previous two years' data do not quite reach this. The European Commission would also be empowered to adopt delegated acts to further increase the allowed deviation for one filling season in case of "persistent unfavourable market conditions", provided that the security of supply of the union and member states is not "undermined". Member states using any of the flexibility provided for above shall "consult the commission and provide justification immediately", the proposal says. The commission will then "promptly update" the Gas Coordination Group (GCG) on the cumulative effects of all granted flexibilities in a "timely manner". The new document also maintains that the commission should continuously monitor the market and explore ways to help meet the filling target, "for example measures of financial nature, in particular when using demand aggregation and joint purchasing mechanism". Where a member state fails to meet its filling target in a given year, its competent authority shall "take effective measures to ensure security of supply considering the price impact on the gas market", and is required to inform the commission and GCG "without delay". The proposed amendments to the legal text note that the regulation will come into force on the day following its publication in the EU's official law journal, although it is unclear whether this will apply to the filling trajectory and target for 2025 or not. The European Parliament's energy committee debated the proposals ahead of a vote on 24 April , and chairman Borys Budka says he expects a compromise on amendments in the coming days. By Brendan A'Hearn Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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German coalition eyes 'limited' foreign carbon credits


09/04/25
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09/04/25

German coalition eyes 'limited' foreign carbon credits

Berlin, 9 April (Argus) — The parties likely to form Germany's next government today presented their coalition treaty, which pledges to allow the use of foreign carbon credits to reach the country's 2040 climate target. The treaty, presented in Berlin by the four party leaders Friedrich Merz of the CDU — the likely next federal chancellor — Lars Klingbeil and Saskia Esken of the SPD, and Markus Soeder of the CDU's Bavarian sister party CSU, stresses the parties' commitment to German and European climate targets, the Paris climate agreement, and reaching climate neutrality in Germany by 2045 "by combining climate action, economic competitiveness and social balance, and by focusing on innovation". "We want to remain an industrialised country and become climate neutral," the treaty reads. The parties' support for the EU's suggested interim target to reduce its emissions 90pc by 2040 compared with 1990 levels is conditional on two points. Germany must not be expected to go beyond its 88pc reduction target for 2040 enshrined in the country's climate action law. And its companies must be allowed, with a view to reducing their residual emissions in an "economically viable" way, to resort to "permanent and sustainable negative emissions", and to "credible CO2 reduction through highly qualified, certified and permanent projects" in "non-European partner countries". Making use of the latter activities should be permissible for up to three percentage points of the 2040 reduction target, although the "priority" for companies will be to reduce carbon emissions. And allowing these options must be reflected in the European Climate Law and the EU emissions trading system (ETS), the parties stipulate. The treaty also underlines the importance of "effective" carbon leakage protection to preserve Germany's "industrial value creation". The treaty calls for the European Green Deal and Clean Industrial Act to be further developed to "bring competitiveness and climate action together", and stresses the importance of carbon pricing instruments, which more countries should be persuaded to introduce. The parties also flag the importance of social acceptance, advocating an "economically viable price development" and pledging to ensure the smooth transition of Germany's domestic carbon price for the heating and transport sectors into the EU ETS 2 on the latter's launch in 2027. The parties pledge "immediately" to adopt a legislative package that enables carbon capture, transport, use and storage (CCU/CCS), particularly for industrial emissions that are difficult to avoid, and also for gas-fired power plants — a disputed issue within the SPD, and the reason why CCS legislation did not pass under the outgoing SPD-Green-led federal government. The new government said it will legally enshrine the "overriding public interest" of the construction of CCS infrastructure, as well as pledging to give the "highest priority" to ratifying the [amendment to the] London Protocol, allowing cross-border CO2 transportation, and to enter bilateral agreements with neighbouring countries on storing carbon. The new government will enable CO2 storage offshore in Germany's exclusive economic zone and the North Sea, as well as onshore where geologically suitable and accepted. The parties see direct air capture as a "possible" future technology to "leverage negative emissions". By Chloe Jardine Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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