Cop 27: Chile inks deals for green hydrogen finance

Spanish Market: Hydrogen
13/11/22

Chile has signed financial agreements with the InterAmerican Development Bank (IDB) and the World Bank to boost green hydrogen development.

The two loan deals were signed this week at the Cop 27 UN climate conference in Sharm el-Sheikh, the country's economic development agency Corfo said.

The first agreement between Corfo and the IDB will provide a "results-based" investment loan of up to $400mn, aimed at broadly supporting the development of Chile's green hydrogen industry, including developing local workforce capabilities and supporting the development of the regions where green hydrogen projects are established.

The World Bank deal will allow access to a $150 million loan in a first stage in 2023 and a further $200mn in a second stage, with the same broad purpose of supporting Chile's development of green hydrogen.

"Chile has unique renewable resources and I believe we can have Chile fully [energy] independent by 2040," the World Bank's global director for energy and extractive industries Demetrios Papathanasiou said. "The [Chilean] government is serious and committed with this strategy to incentivize investors [to invest in green hydrogen]."

Chile launched a national green hydrogen strategy in 2020 which set out plans to become one of the world's top three exporters by 2040. Corfo is responsible for implementing that strategy, and is working with different ministries to create regulations to support three phases of development, Corfo vice-president Miguel Benavente said. The first phase will focus on attracting investments that promote green hydrogen; the second on promoting green hydrogen use in other sectors such as mining; and the third on supporting green hydrogen exports.

Chile has a pipeline of more than 80 green hydrogen projects, 15 of which now have confirmed start-up dates, the country's energy ministry has said. Energy minister Diego Pardow is expected to attend Cop 27 in the coming week for the 15 November launch of the World Bank's new Hydrogen for Development Partnership, an initiative aimed at boosting low-carbon hydrogen deployment in developing countries.

By Jacqueline Echevarria

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15/11/24

Cop: Parties back battery storage, grids and H2 pledges

Baku, 15 November (Argus) — Parties including the US, the UK, Germany, Brazil, the UAE and Saudi Arabia on Friday endorsed pledges on energy storage and grids, and low-carbon hydrogen put forward earlier this year by the UN Cop 29 summit presidency. The pledges aim to increase battery storage capacity six-fold by 2030, from 2022 levels, and enhance energy grids, as well as unlock the potential for a global market for low-carbon hydrogen and its derivatives. It is unclear how many countries have endorsed the pledges so far. Some government representatives, international energy agencies and private sector firms showed their support today to the Cop pledge aiming to enhance grid capacity through a global deployment goal of adding or refurbishing 25mn km of grids by 2030. The commitment also recognises the need "to add or refurbish an additional 65mn km by 2040 to align with net-zero emissions by 2050". "Achieving the grid's target would require the build-up rate to increase by double," energy think-tank Ember said today, adding that the 1,500GW storage goal can be exceeded "significantly". The battery storage goal is in line with what the IEA said is needed to meet the goal of tripling renewable energy capacity by 2030, while maintaining energy security. The commitment was taken last year during Cop 28 in Dubai. The IEA expects that most projects will be located in China and developed economies. Delegates called for national targets for energy storage and power grids as well as for more energy connectivity and trade to be able to decarbonise countries faster and to support regional energy cooperation. "Cross-border energy in Asia Pacific remains mainly in bilateral contracts," said a representative from the region. Parties highlighted the urgency to accelerate energy investment, with the International Renewable Energy Agency (Irena) calling for a new finance goal for developing countries — currently under negotiations — that reflects the need of financing these nations need to accelerate their clean energy expansion. Clean energy investments in emerging and developing countries outside China have risen to $320bn in 2024, according to the IEA. But a representative from Egypt pointing out that over $1 trillion per year is needed for these countries' transition. Saudi Arabia supported both of the pledges, while reiterating that natural gas storage and carbon and capture storage was needed to be able to guarantee stable energy with less emissions. US energy secretary Jennifer Granholm said that the battery storage and grid pledges at the summit will set the tone at next week's G20 where she hopes countries set a similar target. By Jacqueline Echevarria Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Argentina pulls delegation from Baku

13/11/24

Cop: Argentina pulls delegation from Baku

Montevideo, 13 November (Argus) — Argentina's government today withdrew its delegation from the UN Cop 29 climate summit in Baku, Azerbaijan. The country's foreign affairs ministry confirmed to Argus that the delegation had been told to leave the event, which began on 11 November and will run through 22 November. No reason was given for the decision, but it fits the general policies of President Javier Milei, who has expressed skepticism about climate change. Milei eliminated the country's environment ministry shortly after taking office in December 2023. He is also pursuing investment to monetize oil and gas reserves, with a focus on the Vaca Muerta unconventional formation. Vaca Muerta has an estimated 308 trillion cf of natural gas and 16bn bl of oil, according to the US Energy Information Administration. In October, the government created the Argentina LNG division with a plan to involve private companies and the state-owned YPF to produce and export up to 30mn metric tonnes (t)/yr of LNG by 2030. It wants to export 1mn bl of crude. The plans are closely linked to a new investment framework, known as RIGI, that will provide incentives for large-scale investments. The administration is also pushing hard for investment in critical minerals, including copper and lithium. Argentina has the world's second-largest lithium resources, estimated at 22mn t by the US Geological Survey. It has copper potential that the RIGI would help tap. The government has not specified if pulling out of Cop 29 means Argentina will withdraw from the Paris Agreement, which Argentina ratified in 2016. The country's nationally determined contribution calls for net emissions not to exceed 359mn t of CO2 by 2030. This represents a 21pc reduction of emissions from the maximum reached in 2007. By Lucien Chauvin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: UK sets ambitious 2035 climate target

12/11/24

Cop: UK sets ambitious 2035 climate target

London, 12 November (Argus) — The UK government has set a target to cut all greenhouse gas (GHG) emissions by at least 81pc by 2035, from a 1990 baseline, the country's prime minister Keir Starmer said today at the UN Cop 29 climate summit in Baku, Azerbaijan. The target, which will form the basis of the UK's next national climate plan, is in line with recent recommendations from the independent advisory Climate Change Committee . Energy minister Ed Miliband sought the committee's guidance shortly after the Labour government was elected in July. Starmer urged all countries to come forward with new national climate plans — known as nationally determined contributions (NDCs) — at Cop 29. Details of the UK's new NDC are not yet clear, but Starmer said his government is "fully committed" to its pledge of zero-emissions power by 2030. He also repeated his promise for a "government that trod lightly on people's lives". "The UK is stepping up as a climate frontrunner at a time when such leadership is critically needed, co-founder of think-tank E3G Nick Mabey said. "We hope to see detailed implementation plans — ideally with sectoral commitments and a supporting investment roadmap — to lend credibility to its submission." The energy transition "is a huge opportunity", Starmer said, pointing to global appetite for renewables investment. And he noted the "advantage of being a first mover". The country's Labour government, elected in July, has diverged substantially from the previous administration on climate issues. The UK government today announced a "clean industry bonus" — a provisional £27mn ($34.6mn) per GW of offshore wind, to incentivise offshore wind developers to invest in industrial areas, many of which are rooted in the oil and gas industry. This will boost "green jobs" and support sustainable industry, the government said. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Slow H2 progress risks shipping, steel net-zero goals

11/11/24

Slow H2 progress risks shipping, steel net-zero goals

London, 11 November (Argus) — Efforts to keep the steel and shipping sectors on track for the Paris Agreement's 1.5°C target and for net-zero emissions by 2050 are being hampered by the clean hydrogen sector's slow progress, industry participants said on a panel hosted by Paris-based intergovernmental group OECD ahead of the UN climate summit Cop 29. Clean hydrogen will be crucial to decarbonise the steel and shipping sectors because initiatives such as direct electrification and increased energy efficiency will be insufficient to reach net-zero emissions, panellists said. But ensuring supply of clean hydrogen and derivatives at scale and within the timeline required to meet climate goals has proved a challenge. The two sectors together represent 10pc of global CO2 emissions and they would require 10mn-15mn t/yr of low-emissions hydrogen by 2030 in order to be on track for net zero by 2050, OECD environment directorate policy analyst Joseph Cordonnie said. Adapting to the deployment of hydrogen or derivatives in both sectors will take time, considering vessels and plants have a long life, so change needs to accelerate to avoid "emissions lock-in", Cordonnie said. The global steel sector would require around 70 commercial-scale green steel plants by early 2030s to "stay as close as possible" to the 1.5°C target, according to Faustine Delasalle, chief executive at Mission Possible Partnership, a private sector initiative aimed at promoting the decarbonisation of hard-to-abate industries. Around 60 green steel projects have been announced, but fewer than 10 have reached final investment decision (FID), Delasalle said. Fewer than 10 projects targeting production of hydrogen-based fuels such as ammonia or e-methanol specifically for bunkering have reached FID, she said. Technology to decarbonise these heavy industries has progressed significantly over the last years, but "there is a lag" between technological advancements and industrial-scale investment and developers are struggling with project economics, Delasalle said. Many projects for production of hydrogen or derivatives have recently been delayed or cancelled. Demand for products throughout the value chain has not moved at the necessary scale, Delasalle said. While there is voluntary demand for 'green' industrial products, overall demand has not reached a level that can unlock greater investment for projects to scale up, she said. Waiting for the market to balance itself will not deliver decarbonisation, according to Delasalle. Even generous policy support for production such as the US' IRA scheme has not been enough for projects to build a strong business case. This shows the need for measures that "enable the green product to be more competitive versus the grey", like carbon pricing, "the removal of fossil fuel subsidies" and instruments that "drive demand for green commodities regardless of the price", such as mandates and carbon intensity thresholds, she said. Subsidies represented less than 5pc of funding for Swedish green steel producer Stegra's project in Sweden, the firm's public affairs director Ola Hansen said. Stegra has seen demand from offtakers who are voluntarily cutting lifecycle emissions, but "what we really need is carbon pricing and to take away the fossil fuel subsidies," Hansen said. "It's hard to compete with unpriced fossil fuel emissions," he said. By Pamela Machado Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: US climate envoy says clean energy trends to stay

11/11/24

Cop: US climate envoy says clean energy trends to stay

Baku, 11 November (Argus) — The upcoming administration of US president-elect Donald Trump cannot reverse investment in clean energy technologies and innovation in the country, US climate advisor John Podesta said today at the UN's Cop 29 climate summit in Azerbaijan. Talking about clean energy — including nuclear energy and the electrification of the automobile sector — Podesta said that trends would not be reversed under a Trump administration, even though the country will be facing new headwinds. Trump's upcoming administration will attempt to reverse US climate policies , including eliminating tax incentives for clean electricity and the related supply chain through the Inflation Reduction Act (IRA), sparking uncertainty about clean energy investment in the country. But Podesta said that Trump will face opposition even from Republican-led districts. Around 57pc of new clean energy jobs created since the IRA are in congressional districts represented by republicans, he said. "Support for clean energy has become bipartisan, many republicans especially governors know all this activity is a good thing for their districts, states and for their economies." A group of 18 republicans this summer said they opposed a "full repeal" of the IRA because of the growth it is delivering to their districts. "It's precisely because the IRA has staying in power,[that] I am confident the US will continue to reduce emissions, benefitting our own country and benefiting the world," he added. "The economics of energy transition have taken over." The White House estimates that more than $265bn in clean energy investment has been announced since the passing of the IRA. The current administration has still work to make sure investment in clean energy continues to flow once the new administration starts, he said. A permitting reform is receiving bipartisan support in the senate, Podesta said, while the government is working on awarding more funds available through the IRA. Around $98bn has been awarded already, which is 88pc of the funds available for the fiscal year. The government is also working against the clock in completing the implementation of the IRA, which has some tax guidance pending regarding tax credits for clean hydrogen investment, among others. Talking about Cop 29, where parties are due to agree on a new finance goal from developed countries to developing countries, Podesta said that the US is "here to work and we are committed to a successful outcome". "We will continue to encourage people to work diligently to come up with a new funding formula", although he noted that the goal needed to be "realistic". Talking about increasing the contributor base for the finance goal — a difficult issue during technical negotiations — he said that economic circumstances have changed since 1992, and that several developing countries including China are already providing climate finance. The long-running issue around contributors partly stems from the list of developed and developing countries used by UN climate body the UNFCCC. It dates back to 1992, when the body was established, and has been a bone of contention for some time for many developed countries, which argue that economic circumstances have changed in that time frame, and that several countries classed as developing — and typically heavy emitters — should now contribute to climate funds. "We think it's time to take account of those contributions through contributions to multilateral development banks and other forms of cooperation... to make sure that developing countries have the financing they need". He said that the US at Cop 29 was also working on outcomes related to energy deployment, including battery storage and power grids. "The outcome document of this Cop will hopefully point the world in the right direction on that," he said. "Donald Trump may put climate action on the back burner, the work to contain climate change is going to continue in the US," he said. By Jacqueline Echevarria Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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