Cop 29 president seeks climate funds from oil producers

Spanish Market: Crude oil, Emissions, Hydrogen, Natural gas
22/07/24

The UN Cop 29 climate summit's Azeri presidency plans to launch a climate fund, capitalised with voluntary contributions from oil, coal and gas-producing countries and companies, to support developing economies address climate change.

Cop 29 president-designate Mukhtar Babayev has called on contributors to "come forward with climate finance". The Cop 29 presidency is targeting $1bn in initial fundraising, and Azerbaijan will be "a founding contributor", it said. Azerbaijan said last week that it aims to increase its gas exports to Europe.

The fund — the Climate Finance Action Fund (CFAF) — will be filled initially with voluntary contributions from fossil fuel-producing countries and companies, the Cop 29 presidency said. "Members will commit to transfer annual contributions as a fixed sum or based on volume of production," it added. The fund's board will include contributor representatives, the presidency said.

Half of the fund's capital will go to climate projects in developing countries, supporting renewable energy and adaptation — adjusting to the effects of climate change where possible. The remainder will help countries form their national climate plans — known as nationally determined contributions (NDCs) — in line with the Paris climate agreement, the Cop 29 presidency said.

The CFAF aims to mobilise the private sector and de-risk investment, and "profits generated from projects will be reinvested in the fund", the presidency said. It plans to divert 20pc of revenues from investments to a facility "providing highly concessional and grant-based support", accessible to vulnerable countries experiencing the consequences of natural disasters, it added.

If operationalised, the fund would join the loss and damage fund in being reliant on voluntary contributions. Loss and damage refers to the unavoidable and irreversible effects of climate change, such as rising sea levels.

The call for fossil fuel producers to provide climate finance is not new. EU ministers at the Cop 27 summit in 2022 suggested that oil and gas companies should contribute to the loss and damage fund, then under discussion.

The Cop 29 presidency set out its plans for the summit alongside 13 other initiatives. These include a "green energy pledge", the signatories of which will "commit to green energy corridors, zones and grids", according to the presidency. It also named objectives to increase energy storage capacity to 1.5TW by 2030 and to address barriers to a global low-emissions hydrogen market.

Cop 29 is scheduled to take place on 11-22 November in Baku, Azerbaijan.

By Georgia Gratton

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16/04/25

Opec+ overproducers issue new compensation plans

Dubai, 16 April (Argus) — Seven of the eight Opec+ members that began a gradual unwinding of a combined 2.2mn b/d output cut this month have submitted updated schedules for how they plan to compensate for producing above their respective quotas since the start of 2024. The schedules, released by the Opec secretariat today, show Iraq, Kazakhstan, Russia, the UAE, Kuwait, Oman and Saudi Arabia are planning to produce around 305,000 b/d below their combined production targets on average from April through June 2026 ( see table ). This is to compensate for exceeding their production targets by a cumulative 4.573mn b/d between January 2024 and March 2025, the secretariat said. This figure does not represent a monthly average, but rather the sum of the monthly amount by which the overproducers surpassed their respective output ceilings in this period. It works out to an average monthly overproduction of 305,000 b/d. Algeria is the only country in the group of eight that did not overproduce in that stretch, and therefore does not have to compensate. The previous schedule , which was published in the third week of March, envisaged the seven producing around 263,000 b/d below their combined targets on average from March through June 2026. That was to clear 4.203mn b/d of cumulative overproduction between January 2024 and February 2025, or 300,000 b/d on average per month over that period. This latest schedule factors in the decision by these seven countries, and Algeria, earlier this month to speed up the return of a 2.2mn b/d cut by lifting the group's overall production target in May by 411,000 b/d ꟷ three times more than it had originally planned. If implemented fully these compensation cuts should at least largely offset much of the production increases that would be allowed by the Opec+ group of eight's planned unwind through to the second half of 2026. At most, the compensation cuts would more than offset the planned increases for some months, including for this month. But with serial over-producers Iraq and Kazakhstan responsible for delivering the biggest chunk of these compensatory cuts through to the middle of next year, there is no guarantee of full implementation. By Nader Itayim Opec+ overproduction compensation plan* b/d Month Iraq Kuwait Saudi Arabia UAE Kazakhstan Oman Russia Total Apr-25 120 8 15 5 63 5 6 222 May-25 140 15 0 10 116 12 85 378 Jun-25 140 23 10 132 15 111 431 Jul-25 135 30 10 126 17 137 455 Aug-25 130 38 10 141 19 163 501 Sep-25 135 37 10 135 14 189 520 Oct-25 135 10 160 15 320 Nov-25 135 20 114 269 Dec-25 130 20 69 219 Jan-26 125 33 49 207 Feb-26 125 33 38 196 Mar-26 124 33 40 197 Apr-26 120 57 38 215 May-26 120 62 42 224 Jun-26 120 63 36 219 Average reduction 305 *monthly reduction pledge in addition to existing targets Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Dozens of US coal plants eligible for MATS extension

15/04/25

Dozens of US coal plants eligible for MATS extension

Cheyenne, 15 April (Argus) — The White House has identified more than 60 fossil fuel-fired power plants that will have two extra years to comply with the more stringent mercury and air toxics standards (MATS) finalized in 2024. Under a proclamation signed by US president Donald Trump last week, the plants on the list will be able to operate under whatever existing mercury and air toxics standards they currently are subject to until 8 July 2029. That is two years after the compliance deadline put in place in May 2024. The Environmental Protection Agency (EPA) rules finalized last year tightened mercury and air toxics standards for coal- and oil-fired units by 67pc, included new emissions-monitoring requirements and added standards for lignite-fired coal plants that put them in line with those for other coal plants. EPA in March said it was reviewing the new standards and said companies could seek exemptions to the mercury rule and other emissions rules. Trump followed that up last week with a proclamation that certain generating facilities would be given a two-year exemption in complying with the 2024 rule. The White House released the list of exempt power plants late on 14 April. Most of the plants on the list are coal-fired generators, some of which were scheduled for retirement by the end of 2027. These include Tennessee Valley Authority's Kingston plant and one unit of its Cumberland plant, as well as Vistra Energy's Kincaid, Baldwin and Newton plants and two coal units of Vistra's Miami Fort plant. The two coal units at Southern Company's Victor J Daniel plant in Mississippi also have been exempted from the new mercury and air toxics rules for two years. Southern had planned on retiring those units by the end of 2027, but in February, the Mississippi Public Service Commission approved two special contracts that were expected to need unit 2 of the Daniel plant and possibly a unit of a natural gas plant to run into the 2030s. Some other coal plant units owned by Southern, TVA and Vistra also are now exempt from the July 2027 mercury and air toxics compliance deadline. So are some plant units owned by East Kentucky Power Cooperative (EKPC), NRG, Ameren and Entergy. At least two natural gas plant units — unit 5 of Southern's Plant Barry and City Utilities of Springfield's John Twitty Energy Center, which has coal and natural gas generation — are exempt from the July 2027 deadline. So is unit 5 of Entergy's RS Nelson plant, which runs on petroleum coke. Essentially all of the other units in the White House's list are coal units, including Otter Tail Power's Big Stone and Coyote Station plants in North Dakota. Otter Tail said it had requested the exemptions "to avoid making unnecessary expenditures" if EPA decides to roll back the 2024 rule. EKPC said it was "grateful" its request to exempt the Spurlock and Cooper coal-fired power plants in Kentucky was granted and that the company "will continue to operate the plants in accordance with all market and environmental rules." NRG said it was still reviewing the order, but did not expect it to have any effect on its plans. TVA, Southern, Vistra and owners of other power plants given compliance extensions did not respond to requests for comment. By Courtney Schlisserman Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Net zero banking body ups flexibility for climate goals

15/04/25

Net zero banking body ups flexibility for climate goals

London, 15 April (Argus) — The Net Zero Banking Alliance (NZBA) will increase flexibility around climate targets in its framework, allowing its members to set targets aligned with the upper temperature limit sought by the Paris climate agreement. Members voted to introduce less stringent targets "in response to changing external circumstances and member needs", the NZBA said today. The NZBA is a voluntary global initiative with more than 120 banks as members. The group aims to align financing with reaching net zero greenhouse gas (GHG) emissions by 2050 — in line with the Paris agreement. The Paris accord seeks to limit the rise in global temperature to "well below" 2°C above pre-industrial levels, while pursuing efforts to limit this to 1.5°C. Members "voted overwhelmingly in favour of adopting proposed changes", the NZBA said today. Banks that join the alliance commit to developing long-term and intermediate targets towards net zero GHG emissions and to reporting on progress towards these. The changes to the guidance "acknowledge a wider range of net zero pathways that align with the temperature goals of the Paris agreement… This acknowledgment increases flexibility for banks with exposures to a range of markets and sectors to manage targets and transition across their balance sheet", the NZBA said. The alliance also intends to further support members, including around sectoral engagement and to help members understand new and emerging practices and approaches. "Over 100 member banks have already set independent sectoral targets using net zero by 2050 1.5°C pathways. There is nothing in the adopted changes that would cause them to move away from this. 1.5°C remains the guiding star", an NZBA spokesperson told Argus . But the alliance noted that in recent years "the external landscape for banks has rapidly changed". The amended framework recognises that "net zero transitions in the real economy are progressing at different speeds across sectors and regions and that regulatory requirements for climate risk and disclosure have increased in some jurisdictions", the spokesperson said. Several large US banks exited the initiative earlier this year , days ahead of US President Donald Trump's return to the White House. Netherlands-based, sustainability-focused Triodos Bank today said that it would leave the NZBA, as "the new guidelines fall short of the needed urgency to align loans and investments portfolios" with the 1.5°C goal. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

IEA slashes 2025 global refinery runs growth forecast

15/04/25

IEA slashes 2025 global refinery runs growth forecast

London, 15 April (Argus) — The IEA has sharply lowered its forecast for refinery run growth this year, citing escalating tensions in global trade. In its latest Oil Market Report (OMR) published today, the energy watchdog said it expects growth in global crude runs of 340,000 b/d, down by 40pc from its previous forecast of 570,000 b/d. The IEA sees total global crude runs averaging 83.2mn b/d this year. Increased throughput from non-OECD countries still drives this year's growth, with the IEA expecting an increase of 830,000 b/d to 47.6mn b/d. The IEA has not adjusted this figure, as stronger runs in China through the first quarter of this year and higher Russian forecasts have offset downgrades in other non-OECD countries. Chinese crude runs in January and February averaged 15.2mn b/d, around 470,000 b/d higher than the IEA's forecast, it said. The body raised its Russian forecasts from the second quarter as Ukrainian attacks on Russian infrastructure have slowed. The IEA forecasts OECD refinery runs will fall by 490,000 b/d this year because of refinery closures, resulting in a cut from its previous forecast of 100,000 b/d, to 35.6mn b/d. OECD Europe runs are forecast to fall by 310,000 b/d on the year to 10.9mn b/d. OECD crude runs rose by 200,000 b/d on the year in February, 40,000 b/d higher than the IEA expected. Throughput was particularly weak in the first quarter of 2024, when extreme cold cut US run rates. In Mexico, state-owned Pemex's 340,000 b/d Olmeca refinery has still not reached stable operations having started up in mid-2024. The refinery ran no crude in January because of crude quality constraints, the IEA said, and February output there was 7,000 b/d. The IEA estimates the refinery's second crude unit will come online in the fourth quarter. The IEA said refiners will add more than 1mn b/d of global capacity in 2026, but it forecast growths in crude runs of only 300,000 b/d for that year. Assuming all new and expanded refineries come into operation by then, producers will have to cut runs at older refineries, it said. Capacity additions will be largest in Asia-Pacific. The IEA expects China's 320,000 b/d Panjin refinery to come online in the second half of 2026, and for producers to add capacity of 480,000 b/d in India. It sees growth in crude runs as focused on the Mideast Gulf, and runs across the OECD falling. By Josh Michalowski Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

UN carbon market advances on leakage, baseline issues

15/04/25

UN carbon market advances on leakage, baseline issues

Berlin, 15 April (Argus) — The UN's climate arm the UNFCCC has further refined rules relating to greenhouse gas (GHG) leakage and emissions reduction baselines for generating credits under the Paris Agreement Crediting Mechanism (Pacm). The mechanism's methodological expert panel drew up a draft standard on addressing GHG leakage at its fifth meeting last week, clarifying definitions such as "positive" and "negative" leakage, the "activity boundary" and "controlled" sources of GHG. The standard clarifies that the avoidance or minimisation of leakage only applies to negative leakage, even while avoidance of leakage is not possible in all instances. The standard will apply to both emission reductions and removals, and will focus on project-level activities, with a future version to address larger-scale activities such as national crediting programmes. And a draft standard on setting the baseline against which emissions reductions are measured, to prevent over-crediting, outlined the importance of ensuring that the downward adjusted historical baseline of emissions is at least as low as the conservative business-as-usual scenario. The panel proposed future regular revisions of the standard to allow for advances in best available technology, or for mitigation actions implemented at larger and therefore more cost-efficient scales. The panel also suggested some guidance may be needed to determine the scenario for certain types of carbon removal activities. The two draft standards will be put to the Pacm regulator — the supervisory body of the mechanism's governing Article 6.4 of the Paris climate agreement — for adoption. The panel was set up in early 2024 after countries at the UN Cop 28 climate summit in December 2023 threw out the supervisory body's proposals for the mechanism. The panel at its meeting also made progress on the concept of "suppressed demand", which must be taken into account by the Pacm to allow some increase in emissions to enable a host country's socio-economic development. It agreed on the conservative level of 1,000kWh/per capita to "minimise" over-crediting. The panel also progressed on addressing the non-permanence of emissions reductions, with a focus on instances of late, incomplete or missing monitoring reports, deciding on appropriate notification timing and relevant consequences. And it continued work on revising methodologies from the Pacm's predecessor, the clean development mechanism (CDM). The Pacm's first credits will be from transitioned CDM projects. But from next year, all Pacm credits must adhere to their own methodologies. The panel will next meet at the end of May. Stakeholders planning to propose new methodologies and methodological tools for consideration at that meeting must submit them by 21 April. 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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