Japan’s J-Power steps up coal-fired power phase-out

Spanish Market: Coal, Electricity, Emissions, Fertilizers
10/05/24

Japanese power producer and wholesaler J-Power is stepping up efforts to halt operations of inefficient coal-fired power plants, while pushing ahead with decarbonisation of its existing plants by using clean fuels and technology.

J-Power plans to scrap the 500MW Matsushima No.1 coal-fired unit by the end of March 2025 and the 250MW Takasago No.1 and No.2 coal-fired units by 2030, according to its 2024-26 business strategy announced on 9 May. It also aims to decommission or mothball the 700MW Takehara No.3 and the 1,000MW Matsuura No.1 coal-fired units in 2030.

The combined capacity of the selected five coal-fired units accounts for 32pc of J-Power's total thermal capacity of 8,412MW, all fuelled by coal.

While phasing out its ageing coal-fired capacity, J-Power is looking to co-fire with fuel ammonia at the 2,100MW Tachibanawan coal-fired plant sometime after 2030 and ensure it runs on 100pc ammonia subsequently. The company plans to increase the mixture of biomass at the 600MW Takehara No.1 unit, along with the installation of a carbon capture and storage (CCS) technology after 2030. The CCS technology will be also applied to the 1,000MW Matsuura No.2 unit, which is expected to co-fire ammonia, after 2030.

J-Power plans to use hydrogen at the 1,200MW Isogo plant sometime after 2035. The company is also set to deploy integrated coal gasification combined-cycle and CCS technology at the 500MW Matsushima No.2 unit and the 150MW Ishikawa No.1 and No.2 units after 2035.

The company aims to cut carbon dioxide emissions from its domestic power generation by 46pc by the April 2030-March 2031 fiscal year against 2013-14 levels before achieving a net zero emissions goal by 2050. This is in line with Tokyo's emissions reduction target. The company aims to expand domestic annual renewable output by 4TWh by 2030-31 compared with 2022-23, along with decarbonising thermal capacity. Its renewable generation totalled 10.4TWh in 2023-24.

Tokyo has pledged to phase out existing inefficient coal-fired capacity by 2030, which could target units with less than 42pc efficiency. The country's large-scale power producers have reduced annual power output from their inefficient coal-fired fleet by 13TWh to 103TWh in 2022-23 against 2019-20, according to a document unveiled by the trade and industry ministry on 8 May. It expects such power generation will fall further by more than 60TWh to 39.700TWh in 2030-31.

Global pressure against coal-fired power generation has been growing. Energy ministers from G7 countries in late April pledged to phase out "unabated coal power generation" by 2035 or "in a timeline consistent with keeping a limit of 1.5°C temperature rise within reach, in line with countries' net zero pathways".

By Motoko Hasegawa

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

26/12/24

Viewpoint: US amsul demand to stretch supply in 1Q

Houston, 26 December (Argus) — US ammonium sulfate (amsul) prices are likely to remain elevated through the first quarter of 2025 because of increased demand, high feedstock costs and more forward purchases as buyers look to avoid the high prices seen last spring. Scarcity seen in the 2023-2024 fertilizer year in the US amsul market has continued into 2024-2025. Strong demand has drained US inventories, despite rising domestic production in the third quarter, which increased by 11pc to 4.8mn short tons (st) compared to the five-year average of 4.25mn st, according to data from The Fertilizer Institute (TFI). But production in the fourth quarter has fallen because of extended plant downtime. Major production facilities such as AdvanSix's 1.75mn st Hopewell, Virginia, plant and Nutrien's 700,000 metric tonne (t) Redwater, Alberta, plant underwent prolonged turnarounds in the fourth quarter, according to sources. The unplanned downtime reduced the availability of pre-pay volumes in the market and caused at least one producer to partly cover their reduced output by purchasing imports. But imports have only provided the US market with limited supply relief. Year-over-year, US imports are lagging by 17pc from July through October. Around 282,700t of amsul entered the US during the period, compared to the 338,600t that arrived in the same period last year. This year's imports are still 11pc greater than the five-year average, illustrating the trend of demand growth in the US. Increasing feedstock costs have also supported amsul prices through the back-half of 2024. Fertilizer producer IOC said higher feedstock costs were the primary driver of its fourth quarter price hike at the start of October. Feedstock ammonia prices are expected to slip or remain stable for January because of seasonal weakness and lower global prices, said sources. Feedstock sulfur market prices on the other hand have risen over the period and may incur a $20-30/st increase because of rising global demand, according to market participants. Amsul's relationship status update Amsul values slipped in December and early January of last year, allowing the market to buy at lower values before the spring season. The opposite is anticipated to occur this year after major producers AdvanSix and IOC increased their offers for first quarter pre-pay delivery in December. Despite the rising price of amsul, buyers have been lining up more forward deliveries this fall than other years, according to sources. In lieu of hand-to-mouth buying and rising prices last spring, buyers are looking to hedge against potential volatility in the back half of the fertilizer year. Bolstered demand has led to additional price strength which is expected to persist through the winter season. Demand for ammonium sulfate arrived earlier than usual but it is unclear whether it will resurface as strong in the spring. Amsul price in the US Corn Belt recently rose to an average of $380/st, 20pc above the average price in December of last year. Amsul prices typically rise in the spring season when applications begin, so amsul values would appreciate even further if that trend occurs this year. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: US gas market poised for more volatility

26/12/24

Viewpoint: US gas market poised for more volatility

New York, 26 December (Argus) — US natural gas markets may be subjected to more dramatic price swings in 2025 as growing LNG exports and increasingly price-sensitive producers place greater pressure on the US' stagnant gas storage capacity. Those price swings could pose challenges for consumers without ample access to gas supplies, as well as producers interested in keeping some output unhedged to capture potentially higher prices without taking on excessive financial risk. But volatility may also present opportunities for traders looking to exploit unstable price spreads, and for producers that can adapt their operations to fit a more unpredictable pricing environment. Calm before the storm High storage levels and low spot prices this year — averaging $2.11/mmBtu through November this year at the US benchmark Henry Hub — triggered by an unusually warm 2023-24 winter, may have obscured some of the structural factors pushing the US gas market into a more volatile future. But those structural factors remain and loom increasingly large for prices. The US has moved from a roughly 60 Bcf/d (1.7bn m³/d) market eight years ago to a more than 100 Bcf/d market today, "and we haven't grown our storage capacity at all", Rich Brockmeyer, head of North American gas and power at commodity trading house Gunvor, said earlier this year. As supply and demand for US gas grow, the country's roughly 4.7-Tcf storage capacity becomes ever less effective in stemming demand shocks, such as extreme winter weather events, which can more rapidly draw down inventories than in years past. Additionally, a growing share of US gas is being consumed by LNG export terminals being built and expanded on the US Gulf coast. When those facilities encounter unexpected problems and cease operations — as has happened numerous times at the 2 Bcf/d Freeport LNG terminal in Texas in recent years — volumes that were previously being liquefied and sent overseas were instead backed up into the domestic market, crushing prices. More LNG exports may mean more opportunities for such supply shocks. US LNG exports are expected to increase by 15pc to almost 14 Bcf/d in 2025 as operations begin at Venture Global's planned 27.2mn t/yr Plaquemines facility in Louisiana and Cheniere's 11.5mn t/yr Corpus Christi, Texas, stage 3 expansion, US Energy Information Administration data show. Spot price volatility will be most acutely felt in regions like New England that lack underground gas storage. "In areas like the Gulf coast, where you have a lot of storage, it won't be a problem," Alan Armstrong, chief executive of Williams, the largest US gas pipeline company, told Argus in an interview. Producers' trade-off Volatile gas markets are a mixed bag for producers, many of whom profit from volatility while also struggling to plan and budget based on uncertain revenues for unhedged volumes. Though insufficient gas storage deprives the market of stability, "from the standpoint of a marketing and trading guy that's trying to manage my gas supply to customers and my trading book, I love volatility",said Dennis Price, vice president of marketing and trading at Expand Energy, the largest US gas producer by volume. BP chief financial officer Sinead Gorman in November 2023 specifically named Freeport LNG's eight-month-long shutdown in 2022-23 from a fire as a driver of volatility in the global gas market. The supermajor was able to exploit the "incredibly fragile" gas market, she said, which was a key factor driving the success of its integrated gas business. "Those opportunities are what we typically seek and enjoy," Gorman said. Increasingly, producers have also been adapting to a more volatile market by switching production on and off in response to prices, but often without revealing the price at which a supply response will occur. Expand Energy, for instance, told investors in October that it was amassing drilled but uncompleted wells and wells that had yet to be brought on line, which it could activate relatively quickly when prices rise. It declined to name the price at which that would occur. Market participants, attempting to price in this phenomenon by anticipating producers' next moves may respond more dramatically to supply signals than in the past, when production was steadier. Producers' increased responsiveness to prices could help to balance the market somewhat, though more aggressive intervention into operations could take a toll on well performance and pipelines, FactSet senior energy analyst Connor McLean said. Producers are "treating the reservoir itself like a storage facility", Price said. By Julian Hast Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: Unified CO2 market remains in distance

26/12/24

Viewpoint: Unified CO2 market remains in distance

Houston, 26 December (Argus) — Washington state's carbon market enters 2025 on steadier ground than it stood on for much of the past year, but still faces hurdles before it is part of a larger North American market. Washington's cap-and-invest program has weathered a year of highs and lows between advancing its ambitions to link with the Western Climate Initiative and operating through much of the year under threat of repeal in the November state elections. The state Department of Ecology director Laura Watson began the state's quest to link with the WCI last year , as regulators looked to the larger, more liquid market to potentially temper the higher-than-expected prices over the first year of the market in 2023. Washington Carbon Allowances (WCAs) for December 2023 delivery surged as high as $70/t last year, according to Argus assessments. But the state has clinched several wins for its program this year. State lawmakers were able to pass a bill to smooth out several areas of potential incompatibility with the WCI earlier this year, along with California and Quebec agreeing to move forward into formal linkage talks in March . But a repeal effort, initiative 2117, seeking to remove the state's cap-and-invest program dampened prices and forward movement on linkage since January. WCAs for December 2024 delivery fell to the lowest price to date for the program at $30.25/t on 4 March, according to Argus assessments, as uncertainty over the future of the program quieted market participation. State voters backed the cap-and-invest program in November with 62pc against the repeal effort, but months of uncertainty has cost the state time and linkage progress as the WCI awaited the November results. Additionally, while Washington started its own linkage rulemaking in April to align the program with changes planned for the WCI, finishing it requires the joint market first finalize its own changes. The linkage logjam has left market participants feeling that the state's momentum is stalled for the moment, even as perception of the state's eventual joining remains a question of "when" not "if." Ecology says it remains in communication with the WCI members and is evaluating the impact of California's new rulemaking timeline. California has indicated over this year that it does not intend to focus fully on linkage until its current rulemaking is complete. Ecology estimates it will adopt its new rules in fall 2025, with the earliest the state could expect a linkage agreement in late 2025. Washington must still complete further steps required by state law before any linkage agreement can proceed, including an environmental justice assessment and a final evaluation of a potential joint market under criteria set by its Climate Commitment Act, along with public comment. California and Quebec must also conduct their own evaluations to comply with respective state and provincial laws. If this timing works out, Ecology would be part of joint auctions starting in 2026. Compounding the process is the potential threat posed by incoming president-elect Donald Trump, who is likely to try to reverse major environmental regulations and commitments. Trump sought ultimately unsuccessful litigation in his first administration to sever the link between Quebec and California in 2019. The administration pursued the case on the grounds that California's participation violated federal authority to establish trade and other agreements with foreign entities under Article I of the US Constitution, which sets out the role of the federal and state powers in commerce and agreements with foreign powers. Both California and Washington have undergone preparations in recent months to gird themselves for a legal fight with the incoming administration, and that may add further scrutiny to linkage for both states going forward, said Justin Johnson, a market expert with the International Emissions Trading Association. "I think that it will require them to be more vigilant about the process they use and making sure they dot their i's and cross their t's because I think that there will be some folks in the federal administration who would like to see that not happen," Johnson said. By Denise Cathey Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: California dairy fight spills into 2025

24/12/24

Viewpoint: California dairy fight spills into 2025

Houston, 24 December (Argus) — California must begin crafting dairy methane limits next year as pressure grows for regulators to change course. The California Air Resources Board (CARB) has committed to begin crafting regulations that could mandate the reduction of dairy methane as it locked in incentives for harvesting gas to fuel vehicles in the state. The combination has frustrated environmental groups and other opponents of a methane capture strategy they accuse of collateral damage. Now, tough new targets pitched to help balance the program's incentives could become the fall-out in a new lawsuit. State regulators have repeatedly said that the Low Carbon Fuel Standard (LCFS) is ill-suited to consider mostly off-road emissions from a sector that could pack up and move to another state to escape regulation. California's LCFS requires yearly reductions of transportation fuel carbon intensity. Higher-carbon fuels that exceed the annual limits incur deficits that suppliers must offset with credits generated from the distribution to the state of approved, lower-carbon alternatives. Regulators extended participation in the program to dairy methane in 2017. Dairies may register to use manure digesters to capture methane that suppliers may process into pipeline-quality natural gas. This gas may then be attributed to compressed natural gas vehicles in California, so long as participants can show a path for approved supplies between the dairy and the customer. California only issues credits for methane cuts beyond other existing requirements. Regulators began mandating methane reductions from landfills more than a decade ago and in 2016 set similar requirements for wastewater treatment plants. But while lawmakers set a goal for in-state dairies to reduce methane emissions by 40pc from 2030 levels, regulators could not even consider rulemakings mandating such reductions until 2024. CARB made no move to directly regulate those emissions at their first opportunity, as staff grappled with amendments to the agency's LCFS and cap-and-trade programs. That has meant that dairies continue to receive credit for all of the methane they capture, generating deep, carbon-reducing scores under the LCFS and outsized credit production relative to the fuel they replace. Dairy methane harvesting generated 16pc of all new credits generated in 2023, compared with biodiesel's 6pc. Dairy methane replaced just 38pc of the diesel equivalent gallons that biodiesel did over the same period. The incentive has exasperated environmental and community groups, who see LCFS credits as encouraging larger operations with more consequences for local air and water quality. Dairies warn that costly methane capture systems could not be affordable otherwise. Adding to the expense of operating in California would cause more operations to leave the state. California dairies make up about two thirds of suppliers registered under the program. Dairy supporters successfully delayed proposed legislative requirements in 2023. CARB staff in May 2024 declined a petition seeking a faster approach to dairy regulation . Staff committed to take up a rulemaking considering the best way to address dairy methane reduction in 2025. Before that, final revisions to the LCFS approved in November included guarantees for dairy methane crediting. Projects that break ground by the end of this decade would remain eligible for up to 30 years of LCFS credit generation, compared with just 10 years for projects after 2029. Limits on the scope of book-and-claim participation for out-of-state projects would wait until well into the next decade. Staff said it was necessary to ensure continued investment in methane reduction. The inclusion immediately frustrated critics of the renewable natural gas policy, including board member Diane Tarkvarian, who sought to have the changes struck and was one of two votes ultimately against the LCFS revisions. Environmental groups have now sued , invoking violations that effectively froze the LCFS for years of court review. Regulators and lawmakers working to transition the state to cleaner air and lower-emissions vehicles will have to tread carefully in 2025. By Elliott Blackburn Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Логистика сухих грузов - ЛП Транс: в 2025 г. ожидается рост перевозок

24/12/24

Логистика сухих грузов - ЛП Транс: в 2025 г. ожидается рост перевозок

Moscow, 24 December (Argus) — ЛП Транс повысит перевозки по итогам 2024 г. примерно на 25%, до более 16,5 млн т. Вместе с тем средний оборот подвижного состава у компании вырос примерно на 30%, однако пока увеличения количества вагонов не требуется. О тенденциях на рынке перевозок минеральных удобрений рассказал Argus генеральный директор ЛП Транса Роман Воронцов. — Каковы операционные результаты компании за январь — ноябрь? Удалось ли улучшить показатели по сравнению с прошлым годом? — За 11 месяцев мы перевезли более 15 млн т промышленно-сырьевых грузов, включая как сырье для производства удобрений, так и готовый продукт. Рост к аналогичному периоду прошлого года составил 24%. До конца текущего года мы планируем переступить планку в 16,5 млн т и прибавить 25% к итогу 2023 г., когда было перевезено 13,2 млн т различных грузов. Соответственно растет и число вагоноотправок: до конца года мы намерены осуществить 237—240 тыс. отправок против 191 тыс. в прошлом году — рост также ожидается примерно на четверть. — Были ли в этом году какие-то значимые изменения в направлениях отгрузок или структуре перевозимой продукции? — Главным изменением стала переориентация большинства поставок на внутренний рынок. Ранее нашими основными направлениями были порты Балтики и страны СНГ. Теперь же нам открылись новые направления внутри страны, и по большей части мы ориентируемся на внутренние перевозки. Например, у нас выросли объемы транспортировки сырья для выпуска минеральных удобрений в адрес заводов-производителей, а также перевозки цемента для производителей стройматериалов и строительных компаний. — Какие планы на наступающий год? — В 2025 г. мы будем укреплять позиции в сегменте перевозок промышленно-сырьевых и химических грузов, прогнозируем рост в пределах 5%. Также мы продолжим повышать качество услуг, расширять их ассортимент, наша задача — предлагать клиентам не просто вагоны, а оптимальное решение их логистических задач. Планируем сфокусироваться на большей интеграции наших технологий с технологиями клиентов, будем развивать комплексное обслуживание с гарантией надежности перевозок. Таким образом, считаем наш прогноз роста оправданным. — Каким парком сейчас оперирует компания? — На данный момент в управлении компании находится порядка 20 тыс. вагонов, из которых 1,3 тыс. — цементовозы, а оставшиеся — хопперы для перевозок минеральных удобрений, в том числе большекубовые, а также инновационный парк с увеличенной грузоподъемностью. Годом ранее наш парк был схожим по объему, однако теперь он отличается качественно в лучшую сторону. Мы работаем над совершенствованием и техническим обновлением парка, делаем фокус на вагоны с улучшенными техническими и коммерческими характеристиками. В рамках стратегии Группы Деметра Холдинг в 2023 г. было списано порядка 6,2 тыс. вагонов, это выбытие парка мы компенсировали покупкой новых вагонов. За счет этого мы получили большое конкурентное преимущество в виде молодого подвижного состава с улучшенными характеристиками, который не только более привлекателен для клиентов, но и позволяет оптимизировать нагрузку на железнодорожную инфраструктуру. Средний возраст парка снизился с более чем 15 лет до шести-восьми лет, что является одним из лучших показателей по отрасли. Больших списаний вагонов-хопперов в ближайшее время не планируется, соответственно, парк под нашим управлением считаю в целом достаточным для удовлетворения перспективных потребностей наших клиентов. — Рост оборота подвижного состава на сети РЖД не вынуждает увеличивать парк для обеспечения потребностей клиентов? — Замедление оборачиваемости парка — общая проблема для игроков операторского рынка ввиду загруженности инфраструктуры общего пользования и нехватки тяговых ресурсов. Средний оборот вагона у нас довольно сильно увеличился за прошедший год, на ряде направлений рост превысил 30%. К примеру, при перевозках цемента во внутрироссийском сообщении на расстояния до 700 км средний оборот замедлился до 25—27 суток по сравнению с 17—18 сутками годом ранее. Однако к вопросу увеличения парка мы подходим крайне взвешенно. Новые вагоны должны приобретаться только под заключенные контракты, и с нашими клиентами мы проводим подробные консультации относительно того, какой подвижной состав им был бы интересен. Львиная доля наших грузов — в частности, сырье, апатитовый концентрат — имеет высокую плотность, и для их перевозок требуются вагоны со стандартной кубатурой, но повышенной грузоподъемностью. А некоторые грузы с малым удельным весом, к примеру, удобрения азотной группы, в частности, карбамид, напротив, тяготеют к более вместительному подвижному составу. Помимо этого, мы постоянно работаем над повышением эффективности использования наших вагонов, и наша позиция крупнейшего независимого оператора вагонов-хопперов на рынке промышленно-сырьевых грузов дает нам дополнительные возможности по оптимизации логистики. Поэтому текущего размера парка нам хватает. — А что вы думаете о контейнеризации перевозок удобрений? Видите ли перспективы в этом направлении? — Перевод части грузопотока в контейнеры — это все же вынужденная мера. Как вы знаете, северо-западные порты — это основное направление для экспорта удобрений. Порты Прибалтики для нас уже неактуальны, а российских профильных портовых мощностей пока еще недостаточно, прежде всего складских, поэтому контейнеры, использующиеся, как маленькие склады на колесах, оказались выходом из ситуации. Но временным: в 2025 г. ожидается ввод в эксплуатацию терминала Port Favor в Усть-Луге, и спрос на контейнерную схему должен ослабнуть. Все-таки выполняется много лишней работы: пересыпка удобрений из хоппера в контейнер, а из контейнера — непосредственно в бункер сухогруза. Возможно, какой-то дефицит складских портовых мощностей для удобрений все же будет сохраняться и в будущем, а значит, некоторые объемы также будут перевозиться в контейнерах. Но нам кажется, что такой подвижной состав будет занимать не более 10% грузооборота в сегменте. Сейчас он занимает 15%, еще 68% приходится на хопперы, а оставшиеся 17% перевозятся в полувагонах и крытом парке. — Какими вы видите перспективы международных транспортных коридоров Север — Юг и Запад — Восток в 2024—2025 гг. с точки зрения перевозок удобрений? — По коридору Север — Юг все будет зависеть от готовности инфраструктуры и портовых мощностей. Ведь если инфраструктура не будет готова, то перспективы, соответственно, довольно туманные. На Восточном полигоне, как всем известно, провозных мощностей тоже недостаточно. — В 2025 г. ожидается сокращение перевозок угля на восток, что открывает возможности для экспорта, в том числе — минеральных удобрений. Увеличит ли это среднюю дальность перевозки и, как следствие, оборот парка? — Мы готовы к таким вызовам. Если больше грузов будет отправляться на Дальний Восток, соответственно, сократятся объемы поставок через северо-запад. При смене маршрута увеличение оборота парка ожидается в пределах 50—60%. Мы постоянно отслеживаем рыночные тенденции, и если увидим, что есть такой потенциал, конечно, мы примем все меры для того, чтобы отработать и выполнить заявки клиентов. Роман Воронцов Родился в 1978 г. В 2006 г. окончил Петербургский государственный университет путей сообщения по специальности Организация перевозок и управление на транспорте (железнодорожном). В 1995—2002 гг. — дежурный по станции Балтийская Октябрьской железной дороги. В 2002—2016 гг. — начальник отдела организации перевозок, а затем заместитель генерального директора по внутрироссийским перевозкам компании РВД-Сервис. В 2016—2022 гг. — работал на руководящих должностях в операторских компаниях группы Рустранском. С 1 марта 2022 г. по настоящее время — генеральный директор компании ЛП Транс. ЛП Транс Железнодорожный оператор по перевозке промышленно-сырьевых и минерально-химических насыпных грузов в вагонах-хопперах. Входит в структуру Деметра-Холдинга. В 2023 г. компания перевезла более 13,3 млн т различных грузов. В управлении компании находятся около 20 тыс. вагонов-хопперов, в том числе 18,7 тыс. минераловозов и 1,3 тыс. цементовозов. Константин Мозговой Вы можете присылать комментарии по адресу или запросить дополнительную информацию feedback@argusmedia.com Copyright © 2024. Группа Argus Media . Все права защищены.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more