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Cop: Cop28 DG says no red line on fossil fuel phase out

  • Market: Coal, Coking coal, Crude oil, Electricity, Emissions, LPG, Natural gas, Oil products, Petrochemicals
  • 01/12/23

The Cop 28 UN climate conference presidency has no "red lines" when it comes to the language on fossil fuels in the negotiated text, director general Majid al-Suwaidi said today.

"Our job as a Cop presidency is not to have red lines," al-Suwaidi said. "We don't have red lines."

Al-Suwaidi was responding to a question about comments made earlier in the day by UN secretary general Antonio Guterres about the need to phase out, rather than phase down, the use of fossil fuels if the world is to avoid a climate disaster and meet the ambitions of the Paris climate agreement. That agreement sets a goal of limiting global warming to "well below" 2° above pre-industrial averages, and preferably to 1.5°C.

"We cannot save a burning planet with a firehose of fossil fuels," Guterres said. "We must accelerate a just, equitable transition to renewables. The science is clear. The 1.5°C limit is only possible if we ultimately stop burning all fossil fuels. Not reduce. Not abate. Phase out, with a clear timeframe aligned with 1.5°C."

Al-Suwaidi said the UAE, as president of Cop 28, has been "very clear" about the need to discuss energy and the energy system, and how the summit should deliver fossil fuel language. While many countries support a phase out of fossil fuel use, others, the UAE included, view hydrocarbons like oil and gas as having a role in the energy transition.

Cop 28 president Sultan al-Jaber has regularly argued for the need to include all forms of energy, including oil and gas, in the global energy mix, particularly until there is sufficient alternative energy capacity to take over from today's hydrocarbon-heavy baseload.

"It is not oil and gas, or solar. Not wind or nuclear, or hydrogen. It is oil and gas, and solar, and wind and nuclear, and hydrogen," al-Jaber said late last year. "It is all of the above, plus the clean energies yet to be discovered, commercialised and deployed. The world needs maximum energy, minimum emissions."


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05/11/24

Voting set to conclude in race for White House

Voting set to conclude in race for White House

Washington, 5 November (Argus) — Voting concludes today in the US presidential contest between former president Donald Trump and vice president Kamala Harris, a race with high stakes for energy policy, trade and climate change. Polls will close by 6-9pm ET in eastern states and by 11 pm ET in most western states, but election officials say it will take time to count votes, including from mail-in ballots that will trickle in over the coming days. As of 3 November, voters who went to the polling stations early or sent mail-in ballots added up to 48pc of the total turnout in 2020, according to analysis by the Washington Post. The presidential race is likely to be determined by voters in Michigan, Wisconsin, Pennsylvania, North Carolina, Georgia, Arizona and Nevada, where pre-election polls have shown no decisive lead for Harris or Trump. Voters are casting ballots at a time when domestic oil and gas production is booming. US crude output reached a record high 13mn b/d last year, while gas production hit a record 103 Bcf/d, according to the US Energy Information Administration. Despite record production and profits in the oil industry, Trump has focused heavily on energy policy — and voter anger over higher prices across the economy — in his bid to win a second term. US drivers paid an average of $3.07/USG for regular grade gasoline in the week ended on 4 November, the lowest price in 10 months — but still higher than at any point during Trump's first presidency. On the campaign trail, Trump has assured oil and gas producers that under his watch they would be permitted to "drill, baby, drill" and has promised to dismantle the energy tax credits in President Joe Biden's signature climate initiative, the Inflation Reduction Act. Harris has committed to support the 2022 law and other energy policies adopted by Biden, including continued support for electric vehicles. Harris has disavowed her 2019 pledge to ban hydraulic fracturing. But oil and gas firms remain concerned about restrictions on federal leasing and efforts to electrify the vehicle fleet if she is elected. The next president will decide key questions on energy policy, such as how to proceed with a "pause" on the licensing of new US LNG export facilities and to manage climate-related rules for power plants, oil and gas facilities and vehicles. The race for the White House will have equally high stakes for companies involved in metals and agriculture , as well as other commodities. Trump is planning a combative approach to trade, with a 20pc tariff on all foreign imports and even higher tariffs against China, and to rescind many regulations. In 2025, the US Congress is poised for a major fight on tax policy because of the year-end expiration of an estimated $4 trillion in tax cuts. Russia's war on Ukraine, and the future of US restrictions on Russian energy exports is also at stake during the election. Trump has vowed to end the war by forcing Kyiv to negotiate a deal with Russian president Vladimir Putin and appears to back the Kremlin's argument that the continuation of US sanctions on Russia would weaken and undermine the dollar. A Harris administration would continue enforcing the G7 price cap on Russian oil exports and, possibly, add to the restrictions on Moscow's earnings from its oil and gas exports. The growing threat of an Israel-Iran war and its potential impacts on oil flows from the Middle East is threatening to overwhelm the final months of Biden's term in office and any foreign policy initiatives either candidate vying to succeed him will pursue in the region. US-China relations are likely to remain adversarial in coming years. Viewing Beijing as the principal economic and geopolitical challenge for the US is a rare overlap in foreign policy priorities identified by Trump and Harris. Of particular concern in Washington is the ability of oil exporting countries such as Iran, Venezuela and Russia to find willing buyers for their crude in China despite US sanctions. Polls also show a tight race in the fight for control of the US House of Representatives, where Republicans hold a slim 220-212 majority. Up to 22 congressional races are up to grabs, with a range of potential outcomes favoring either party, election ratings firm Cook Political Report says. Cook rates 208 seats as solid or leaning Republican, and 205 solid or leaning Democratic, with both shy of the 218 needed for control of the chamber. In the US Senate, where Democrats hold a 51-49 majority, Republicans have a clear path to taking control because of polling leads in West Virginia and Montana. Republicans could win control of the Senate by flipping just one seat, if Trump wins the election, but would need to flip two seats if Harris wins. By Chris Knight and Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Latin America mulls nuclear power revival


05/11/24
News
05/11/24

Latin America mulls nuclear power revival

New York, 5 November (Argus) — Nuclear power is gaining traction in Latin America as countries see small modular reactors (SMRs) as options for remote regions that are not connected to power grids. "The advent of SMRs are behind Latin America's new interest in nuclear energy, because they do not need to be large and do not require large investments," said Modesto Montoya, a nuclear physicist and former president of the Peruvian Institute for Nuclear Energy. Nuclear power is not a prevalent source of electricity in Latin America, producing around 2pc of the region's power consumption. There are seven nuclear power plants with a total capacity of 5.07GW in operation in the region, located in Argentina, Mexico and Brazil. Argentina has a 32MW SMR plant under construction. But the role of nuclear could increase in the region. Argentina, Brazil and Mexico are providing technical advice to countries that are considering including the technology in their power systems. Earlier this month, El Salvador approved a nuclear energy law and signed a memorandum with the Argentinian government for scientific and technology cooperation for nuclear power. Daniel Alvarez, director of the Agency for Implementation of the Nuclear Energy Program in El Salvador, told Argus that the country was "following the book to develop nuclear power. We want to convert El Salvador into a nuclear country." The country needs to replace fossil fuels as half of the country's power capacity is fueled by bunker fuel. It has 204MW of geothermal capacity installed and, while solar energy is possible, the country's size limits the amount of physical space to add large solar plants. The government's plan is to have a research reactor and 400 people trained to manage a nuclear plant within seven years. The next step would be the construction of SMR. "We have to include alternatives for power generation and SMRs are a very good option. We want to include them in our transition to 2050,"Alvarez said. SMRs are also seen as a solution to the energy problem in the northern jungle city of Iquitos, in Peru, energy and mines minister Romulo Mucho said. It is one of the world's largest cities that is not accessible by road and not connected to the national grid, relying primarily on fuel oil for power generation. Peru has had experience with nuclear technology since 1988, when it opened the nuclear research facility, RASCO. Neighboring Bolivia has been working on a small nuclear program since the previous decade with Russia's Rosatom. It has a center for nuclear medicine and is finishing a small research reactor. Ronald Veizaga, deputy minister of electricity and renewable energies, said Bolivia began the program to improve medical treatment for cancer, but has changed gears. "Critics claim SMRs are expensive, but it is more expensive to have blackouts affecting your population and industry," he said. Traditional nuclear Paraguay is considering a more ambitious path, looking at a traditional nuclear plant. "We need to make political decisions if we want to explore a SMR or a large-scale plant to generate 1GW or more," said Jorge Molina, executive secretary of Paraguay's Radiology and Nuclear Authority. Paraguay could work with Argentina and Brazil to create a regional platform. "Our idea is part of regional integration. Our neighbors are already helping us develop our regulations," he said. But the construction of nuclear plants comes with challenges including high costs, time, labor and materials. Brazil began work on the 1.4GW Angra 3 nuclear plant in 1984 but works have been halted and resumed several times since then. The plant is roughly 67pc complete and has been in limbo since 2015. The country's Bndes development bank recently concluded that abandoning the construction of the project would be less costly than completing it. By Lucien Chauvin Countries with installed nuclear capacity in Latin America GW Country Capacity Argentina 1.64 Brazil 1.88 Mexico 1.55 — Ons, Cammesa, Cenace Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Japan’s 53MW Chokai Minami biomass plant comes on line


05/11/24
News
05/11/24

Japan’s 53MW Chokai Minami biomass plant comes on line

Tokyo, 5 November (Argus) — A joint venture led by Japanese utility Tohoku Electric Power has started commercial operations at the 53MW Chokai Minami biomass-fired power plant in Japan's Yamagata prefecture. Operations started on 2 November. The plant burns a combined 200,000 t/yr of imported wood pellets and palm kernel shells (PKS) to generate around 330 GWh/yr of electricity, which will be sold under the country's feed in tariff (FiT) scheme, the joint-venture company announced on 5 November. The plant is operated by Chokai Minami Biomass Power, which is 75pc owned by Tohoku Electric Power, 15pc by renewable energy developer Olympia and 10pc by a subsidiary of Japanese gas supplier Shizuoka Gas. Chokai Minami is Tohoku's first biomass-only combustion project. The company has also invested in the 50MW Niigata Higashikou biomass plant, which is planning to start operations in mid-November, later than October as initially scheduled. Tohoku has two other planned biomass projects, the 2MW Yokote and the 2MW Yuzawa plants. These facilities are scheduled to come on line in June 2026 and October 2026 respectively. By Takeshi Maeda Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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US railroad-labor contract talks heat up


04/11/24
News
04/11/24

US railroad-labor contract talks heat up

Washington, 4 November (Argus) — Negotiations to amend US rail labor contracts are becoming increasingly complicated as railroads split on negotiating tactics, potentially stalling operations at some carriers. The multiple negotiating pathways are reigniting fears of 2022, when some unions agreed to new contracts and others were on the verge of striking before President Joe Biden ordered them back to work . Shippers feared freight delays if strikes occurred. This round, two railroads are independently negotiating with unions. Most of the Class I railroads have traditionally used the National Carriers' Conference Committee to jointly negotiate contracts with the nation's largest labor unions. Eastern railroad CSX has already reached agreements with labor unions representing 17 job categories, which combined represent nearly 60pc of its unionized workforce. "This is the right approach for CSX," chief executive Joe Hinrichs said last month. Getting the national agreements on wages and benefits done will then let CSX work with employees on efficiency, safety and other issues, he said. Western carrier Union Pacific is taking a similar path. "We look forward to negotiating a deal that improves operating efficiency, helps provide the service we sold to our customers" and enables the railroad to thrive, it said. Some talks may be tough. The Brotherhood of Locomotive Engineers and Trainmen (BLET) and Union Pacific are in court over their most recent agreement. But BLET is meeting with Union Pacific chief executive Jim Vena next week, and with CSX officials the following week. Traditional group negotiation is also proceeding. BNSF, Norfolk Southern and the US arm of Canadian National last week initiated talks under the National Carriers' Conference Committee to amend existing contracts with 12 unions. Under the Railway Labor Act, rail labor contracts do not expire, a regulation designed to keep freight moving. But if railroads and unions again go months without reaching agreements, freight movements will again be at risk. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Trump unlikely to fully end US clean energy policies


04/11/24
News
04/11/24

Trump unlikely to fully end US clean energy policies

Houston, 4 November (Argus) — Although former US president Donald Trump has promised to end climate policies enacted during the administration of President Joe Biden, the political complications of reversing course make a full change of direction unlikely should Trump return to the White House. Trump has frequently criticized Inflation Reduction Act (IRA), promising to terminate the " Green New Scam " and rescind all unspent funds in the Biden administration's climate policy suite, if he is elected to a second term. But fulfilling that pledge may be difficult for many reasons, not least of which is whether Republicans have control of both chambers of Congress after Tuesday's election, including the unlikely outcome of a 60-seat majority needed to bypass a Senate filibuster. Beyond the math, Republican districts are benefiting from IRA funding, with some lawmakers from Trump's party already opposing the turmoil that could arise from an about-face on tax policy. "There's no way they're going to be able to replace and repeal the IRA, in large part because so many of the dollars are flowing to [Republican] states," said David Shepheard, a partner at consultant Baringa who specializes in energy and resources. "I think the pieces of the IRA that are most at risk are the [electric vehicle] tax credits, potentially some of the stimulative pieces around offshore wind." The IRA established a host of federal incentives to support clean electricity growth and the associated domestic supply chain. Those include technology-agnostic production and investment tax credits for electricity generators based on their emissions intensities. But the law went well beyond the power sector and also established credits for hydrogen production, electric vehicles and the manufacture of components needed by clean electricity systems. Project developers are counting on a policy trajectory that does not match Trump's rhetoric, which would allow some incentives to stay on the books. Companies expect market forces, such as corporate demand, and state mandates to continue to drive growth for solar and onshore wind and energy storage, rather than national politics. But there is more trepidation around offshore wind, a less mature sector for which the federal government is effectively the landlord for project sites. "There is no doubt that the trajectory of the US offshore wind industry will be impacted by the November election," Liz Burdock, chief executive of offshore wind industry group Oceantic Network, said. "Its outcome will influence how we maintain our momentum." Uncertainty around the US presidential election has dampened private investment in the sector this year, according to Oceantic. At the same time, companies say the industry has come a long way since 2016, with a handful of projects now operating, while recent macroeconomic challenges are subsiding. Furthermore, demand for offshore wind would continue at the state level, and these factors could make the industry more resilient to headwinds. Executive decisions Trump still could use the executive branch to "stonewall" sectors helped by the IRA in the absence of a repeal, including by influence the timing or distribution of IRA funds, according to Shepheard. He could shift regulators' priorities to new oil and gas development, which, along with other actions, could make resources such as combined-cycle natural gas plants more attractive than renewables. "The extent that renewables and other cleaner energy assets are competing with gas, that'll be the big change from a Trump administration," Shepheard said. At the same time, funding for onshore wind and solar is "relatively safe", and tax credits for hydrogen and carbon capture are on comparably firm ground because of support from the oil and gas industry, Shepheard said. Some companies have expressed cautious optimism that some elements of the IRA, such as the advanced manufacturing tax credit, will survive. The incentive is not only important for the solar supply chain but also offshore wind, as state-level solicitations often require developers to invest in local manufacturing. Republican states in the US southeast have already benefited from new factories springing up on the back of the credits. For example, Enel chose Oklahoma for a new new module plant , First Solar located a factory in Alabama and Qcells has expanded production in Georgia. Moreover, removing that carrot could leave the US solar industry reliant on Chinese companies, which could run afoul of Trump's protectionist trade instincts. Trump's campaign did not respond to multiple requests to elaborate on his policy plans. By Patrick Zemanek Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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