I-REC January-August demand surpasses whole of 2023
International renewable energy certificate (I-REC) demand in January-August surpassed consumption in all of 2023, with 20pc more I-RECs redeemed in August compared with the same month last year.
Higher redemptions in Colombia, Malaysia and India last month outpaced lower demand from key buyers Brazil and China.
Global I-REC redemptions totalled 9.9TWh in August, higher than 8.2TWh in August 2023 and broadly steady on the month. A total of around 182TWh was redeemed in January-August this year, surpassing the 176TWh redeemed in all of 2023.
There were 14.2TWh of I-RECs issued in August, up from 12.7TWh in July but below the 14.9TWh a year earlier. The 12-month rolling average of issuances is 25.8TWh.
Latin America
I-REC redemptions in Latin American countries totalled 4.1TWh in August, up from 3.1TWh a year earlier. Colombia accounted for around 65pc of redemptions with 2.65TWh — the highest in at least three years — surpassing Brazil, which accounted for almost 20pc.
Brazilian I-REC demand was around two-thirds lower last month compared with August 2023, with 762GWh redeemed compared with 2.4TWh a year earlier. But the country is still the largest I-REC consumer in 2024 so far, with 41.3TWh redeemed over January-August.
Issuances in Brazil more than halved on the year to 532GWh in August, the lowest since June 2022.
Brazilian 2024 hydropower and wind/solar I-RECs were last assessed at $0.17/MWh and $0.19/MWh, respectively, on 28 August, both steady since the end of July.
I-REC demand was nearly 10 times higher on the year in Chile, where redemptions were at 266GWh last month compared with 29GWh in August 2023. But they declined from both June and July, with almost 700GWh redeemed in each month.
Asia-Pacific
Redemptions in the Asia-Pacific region edged up to 3.6TWh in August from 3.1TWh a year earlier, as a slight decline in Chinese demand was offset by a surge in redemptions in Malaysia.
Redemptions in China were at 2.2TWh last month compared with 2.3TWh in August 2023, although they still accounted for the biggest share in the region at 61pc. Chinese I-REC issuances also declined last month and were at 5TWh, down by 2TWh year-on-year.
There were 1.1TWh of I-RECs redeemed in Malaysia in August, the highest since February and nearly 12 times higher than August 2023. Approximately 8.4TWh have been redeemed in the country so far this year, compared with 9.1TWh in all of 2023. Hydropower comprises the biggest share of redemptions so far in 2024 at 7.1TWh, followed by solar with 1TWh.
The volume of I-REC issued in Malaysia edged down to 623GWh last month from 672GWh in August 2023.
Malaysian current-year hydro I-RECs were assessed at $1.30/MWh throughout August, broadly steady since Argus assessments began in February. Solar I-RECs with 2024 vintage were at $5.60/MWh at the end of last month, up from $5.25/MWh when assessments first launched on 15 February.
South Asia
Redemptions in India continued to rise last month to 854GWh, up from 813GWh in July and 550GWh in August 2023.
I-REC issuances were at 1.1TWh in August, down from 1.17TWh in July but nearly two times above the 576GWh issued in August last year. Earlier this week, the International Tracking Standard Foundation announced that ICX, a wholly-owned subsidiary of Indian Energy Exchange (IEX), has been approved as the country's first local issuer of I-RECs for renewable electricity.
The latest Argus assessments for 2024 Indian hydro and wind/solar I-RECs were $0.50/MWh and $0.65/MWh, respectively, on 29 August, both down by $0.05/MWh on the week after holding steady since the end of July.
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Australia faces uncertainty over climate credentials
Australia faces uncertainty over climate credentials
Sydney, 2 September (Argus) — Australia's Labor Party-led federal and state governments have advanced key policies over the past year that could help the country meet its 2030 emissions reduction targets. But increased climate opposition, looming national elections in 2025 and policies supporting fossil fuel use threaten to slow the momentum. Canberra has moved to address the country's ability to meet its key 2030 target of renewables accounting for 82pc of energy use — a weak spot in its greenhouse gas (GHG) emissions reduction plan. The goal was looking increasingly unachievable without support so the government expanded its Capacity Investment Scheme (CIS), launching a first major 6GW tender in May. Tenders will run every six months until 2026-27 for a total of 32GW, consisting of 23GW of renewables — solar, wind and hydro — and 9GW of dispatchable capacity such as pumped hydro and grid-scale batteries, all to be in operation by 2030. Australia could achieve a 42pc GHG emissions reduction from 2005 levels by 2030 under a scenario "with additional measures", which include the expanded CIS, the government's projections show. This would be just short of the legislated 43pc target, prompting ministers to assert the goal could be within grasp. But the country must resolve problems arising from its increasingly constrained electricity grid, which have been compounded by slow planning and environmental assessment processes, in part because of rising community opposition. The renewables and transmission rollout has been slower than expected, and some states will be paying utilities to postpone the closure of coal-fired plants, raising concerns that any further extensions could impact the 2030 national target. Australia also faces resistance in other key sectors. Canberra had to backtrack on fuel efficiency standards for new passenger and light commercial vehicles, meaning it may need to look at other options to cut emissions from transportation. This sector currently accounts for a fifth of Australia's total GHG emissions, but could be the largest source by 2030 as the electricity sector decarbonises. Nuclear option Labor, which governs Canberra and all Australian states and territories except Tasmania, faces rising competition in elections next year. The opposition Liberal-National coalition in June said it continued to support achieving net zero emissions by 2050, but warned that Labor's revamped 2030 targets could not be met. Labor's "renewables-only approach" raises supply security and cost issues, the opposition says. It promises instead to focus on a nuclear energy plan to bring state-owned reactors on line as early as 2035-37, if it is elected next year. The opposition coalition has declined to set its own 2030 goal for GHG emissions cuts and is yet to provide more details about its plans, but its strategy of capitalising on the cost-of-living crisis and discontent over large-scale renewables and transmission projects across regional and rural communities seems to be working. Recent polls indicate lower approval ratings for prime minister Anthony Albanese. Australia will join the UN Cop 29 climate conference in Azerbaijan in November looking to win its bid to co-host Cop 31 in 2026 with its vulnerable Pacific island neighbours. But uncertainty over its climate ambitions requires the country to assert its position as a new global climate leader and move on key issues agreed at Cop 28, including transitioning away from fossil fuels, as Pacific countries demand. But Australia still sees gas playing a crucial, albeit reduced, role in its energy transition, and a new strategy in May stated the need to bring new gas supplies on line to keep domestic energy affordable and maintain Australia's status as a reliable LNG supplier. Almost 80pc of Australia's fossil fuel CO2 footprint in 2022 came from its exported carbon, non-governmental organisation Climate Analytics says. By Juan Weik Australia's emissions mn t CO2e Sector 2005 2020 2025* 2030* Electricity 196.7 172.0 131.6 81.4 Stationary energy 82.2 99.9 101.9 96.4 Transport 82.0 93.2 102.2 101.6 Fugitive 42.8 53.6 49.8 46.5 Agriculture 86.0 72.6 79.0 79.8 Industrial processes 30.1 31.9 29.8 24.5 Waste 15.7 13.5 13.2 13.1 LULUCF† 80.7 -42.5 -55.3 -57.1 Total 616.3 494.2 452.1 386.0 Total WAM scenario‡ 358.0 *projected †land use, land-use change and forestry ‡with additional measures — Australian government Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan faces further delay in nuclear fuel recycling
Japan faces further delay in nuclear fuel recycling
Osaka, 30 August (Argus) — Japan Nuclear Fuel (JNFL) has again extended the start-up of the country's first commercial nuclear fuel reprocessing plant, as it needs extra time to enhance safety features. JNFL, a joint venture of Japanese power utilities, now aims to finish construction of the recycling plant at Rokkasho in north Japan's Aomori prefecture in the April 2026-March 2027 fiscal year, instead of the previous target of "as early as possible" in April-September 2024. The company has also pushed back the completion of building the mixed oxide fuel fabrication plant to 2027-28 from April-September 2024. This is the 27th postponement, far behind its original target of 1997. The repeated delays stemmed from technical issues and safety measures required following the 2011 Fukushima nuclear disaster. Recycling spent nuclear fuel is becoming a critical issue for Japan, as the natural resource-poor country sees the quasi-domestic fuel as an important power source to ensure its energy security and spur its decarbonisation. But the country faces growing constraints on its ability to store radioactive waste, with repeated delays in setting up the reprocessing plant, which may threaten Tokyo's efforts to restart more reactors. Spent fuel has accumulated to 2,968t uranium fuel (tU) at the Rokkasho reprocessing plant, nearing its capacity of 3,000tU. The waste has piled up since 2000 in anticipation of its operation and since shipments to the UK and France by utilities ended in 2001. Japan's overall nuclear waste storage, which has combined capacity of about 24,440tU including Rokkasho's facility, was 81pc full at the end of March 2024, up from 75pc in 2019, according to the trade and industry ministry. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Greece expects 70pc fall in gas demand by 2050
Greece expects 70pc fall in gas demand by 2050
London, 28 August (Argus) — Greek gas demand will fall by nearly 70pc by 2050 as increasing renewable power installations displace gas in the power generation mix, according to Greece's revised National Climate and Energy Plan (NECP) put out for consultation last week. Gas consumption falls to 44.1TWh in 2030 and then to 16.2TWh by 2050 from 51.2TWh in 2022, under projections in the NECP. This will be driven by renewables displacing gas in the power mix, the replacement of gas units for heating in residential and industrial contexts through electrification, and a rise in the production of biogas and biomethane. Specifically for industry, the NECP assumes that gas demand will gradually decline to just 900GWh by 2050 from 6.6TWh in 2022, while in the commercial and public sector it will drop to 200GWh ( see gas table ). The NECP assumes a "dramatic increase in the electrification of building heating" through heat pumps, taking into account the ban on the sale of new oil and gas boilers from 2025, new EU laws on energy efficiency requirements in buildings, and the inclusion of building emissions in the EU emissions trading system. The power sector accounts for the majority of Greek gas demand. The NECP assumes that gas-fired power generation will decline to 10.4TWh by 2030 and 4.8TWh by 2050, far below 19.1TWh in 2022. Gas is displaced by solar and wind, with renewables contributing 96pc of domestic power generation by the middle of the century ( see power table ). But the NECP still foresees installed gas-fired capacity remaining high later into the decade, reaching a peak installed capacity of 7.9GW in 2030 before falling back to 6.4GW in 2050, slightly above 6.3GW in 2022. The government expects Greece to become a net power exporter already in 2035, having been a net importer of 3.5TWh in 2022. Gas-fired plants will remain "essential to ensure, in all cases, the stability and security of supply of the electricity system throughout the energy transition period", the NECP says. The plan foresees the need for a national compensation mechanism for gas-fired plants, particularly given the likely expansion of energy storage such as batteries further displacing gas from the power mix in 2030-40. Even some oil plants will potentially need to remain in cold reserve in case of emergency, mostly to ensure supply to some of the Greek islands. And while the plan projects a nearly 70pc drop in gas demand by 2050, it still envisages the expansion of the national transmission system, mostly to facilitate Greece becoming "the main energy hub of the wider region". The plan lists seven main gas interconnector projects that are of "national, regional and international interest", including the doubling of the Trans-Adriatic pipeline's capacity to 10bn m³/yr, an expansion of the Interconnector Greece-Bulgaria's capacity to 5bn m³/yr, and the implementation of the Dioriga Gas LNG terminal, among others. If transmission system operator Desfa's expansion plans are fully carried out, transit capacity will increase to 8.5bn m³/yr by 2026 from 3.1bn m³/yr at present. However, these plans could be endangered "if the declared intention to fully decouple the EU from Russian gas is not implemented and if regional needs continue to be met mainly by Russian gas channelled through Turkey". To avoid significant increases in Greek transmission tariffs, "only the absolutely necessary investments in the expansion of gas infrastructure" are promoted, according to the plan. The NECP supports the development of small-scale LNG, enabled through the truck-loading services at Revithoussa and the under-construction bunkering jetty there. Small-scale LNG can displace oil in remote locations not connected to the gas grid, and is also important in decarbonising shipping and heavy land transport, the plan says. Annual biomethane production rises to 2.1TWh by 2030 and 4.6TWh in 2050 from zero at present under the plan. About 80 biogas plants currently produce 1.4 TWh/yr of biogas, and 38 of these adjacent to gas networks could be converted "relatively quickly" to biomethane production of about 900 GWh/yr. The remaining 1.2 TWh/yr targeted by 2030 will come from new plants. The NECP also aims to cut Greece's dependence on imports through the development of domestic gas production, if it proves to be commercially viable. Greece has awarded nine onshore and offshore exploration licences, and in April 2022 declared these projects to have national priority. In the past two years, "investigations have been accelerated" and drilling decisions are expected in the next two years. If final investment decisions are taken, new domestic production could come on line before the end of the decade. Preliminary estimates put potential and probable reserves in Greece at about 680bn m³, which if exploited would make Greece an exporter already by 2030, according to the NECP. More domestic production increases revenues for the Greek state, which can partly be used to implement the energy transition, the government said. By Brendan A'Hearn Projected annual power production by source TWh/yr 2022 2025 2030 2035 2040 2045 2050 Lignite 5.8 4.5 - - - - - Natural gas 19.1 12.2 10.4 4.3 4.4 4.4 4.8 Oil 5.1 1.9 0.4 0.3 0.2 - - Biomass and biogas 0.1 0.5 0.4 - - - - Solar 7.1 12.5 20.3 27.0 37.1 43.8 49.2 Onshore wind 10.9 15.8 20.7 21.9 25.5 30.3 30.2 Offshore wind - - 0.6 14.7 21.7 30.6 43.6 Hydro 3.9 5.8 6.4 7.4 7.7 8.6 9.1 Net imports 3.5 3.2 1.8 -3.7 -6.7 -11.1 -6.6 — Greek NECP Industrial and residential/commercial gas demand TWh/yr 2022 2030 2035 2040 2050 Industrial gas demand 6.6 4.9 4.6 1.4 0.9 Residential/commercial gas demand 1.3 1.2 0.9 0.2 0.2 — Greek NECP Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan seeks $11bn green budget funding
Japan seeks $11bn green budget funding
Osaka, 28 August (Argus) — The Japanese government is expected to request around a ¥1.6 trillion ($11bn) budget for 2025-26 and the following fiscal years to help drive the country's green transformation (GX) strategy to achieve its net zero emissions goal by 2050. The GX implementation council led by premier Fumio Kishida on 27 August unveiled its draft budgetary request plan for sectors involved in the GX, which aims at securing at least ¥1.6 trillion, excluding projects whose costs are unspecified. Tokyo is considering seeking ¥1.2 trillion for 2025-26, while asking for the remaining budget to be allocated for 3-5 years. The initial GX-related budget for 2024-25 was around ¥1.7 trillion, including a supplementary budget for the previous fiscal year. The government plans to allocate ¥255.5bn, or 22pc, of its total budget request for 2025-26, to help set up domestic supply chains to drive its decarbonisation efforts. This includes further development of perovskite solar cells, offshore wind power, storage batteries, water electrolysers and fuel cells. Japan is anticipated to require more than ¥150 trillion of public-private investment to promote energy transition over 10 years from 2023-24. Tokyo plans to issue around ¥20 trillion of GX economic transition bonds over the decade to support the investment. Tokyo is now working on formulating the GX vision toward 2040, aiming to complete it by the end of this year. The council on 27 August proposed specific areas to accelerate discussions, including efforts to restart existing nuclear reactors and development of next-generation reactors, as well as renewable energy expansion, LNG and future fuel supply security and industry relocations. Kishida has promoted nuclear reactors to enhance the country's energy security under his GX strategy, updating the country's nuclear policies since he took office in October 2021. The nuclear-pro GX discussions may influence the continuing review of the country's strategy energy plan (SEP), which was last formulated in 2021 and calls for a reduction of the dependence on nuclear reactors as much as possible. Tokyo should clearly state in its new SEP that it is necessary to not only restart existing nuclear reactors but also build new ones, said Japan's Federation of Electric Power Companies previously. Kishida has decided to step down from his position as leader of the ruling Liberal Democratic Party next month. But he has emphasised he will make an effort to advance the GX strategy during the rest of his tenure, especially for nuclear restoration in east Japan where no reactors are currently operating. Kishida plans to hold a nuclear-related ministerial meeting next week to work on details of the government support to secure approval by local authorities to restart the 1,356MW Kashiwazaki-Kariwa No.7 reactor. The Kashiwazaki-Kariwa nuclear plant is owned by Tokyo Electric Power (Tepco). It is Tepco's sole nuclear plant, after the Fukushima-Daiichi and its nearby Fukushima-Daini nuclear plants were scrapped in the wake of the country's 2011 nuclear disaster following a devastating earthquake and tsunami. By Motoko Hasegawa Japan 2025-26 draft GX-related budget request (¥bn) Introduction of EVs, PHEVs, FCVs 144.4 Introduction of highly insulated windows, high-efficiency water heaters 188.0 Retrofitting existing buildings 26.6 SAF production and supply chain 83.8 R&D of next generation nuclear reactors 82.9 Introduction of energy storage system 31.0 Establishing domestic supply chains such as: 255.5 Perovskite solar cells, Offshore wind power, storage batteries, water electrolysers, fuel cells Support for hard-to-abate industries 87.0 Introduction of production facility for zero emissions vessel 14.3 Support for advanced energy saving measures by small to medium enterprises 174.3 Circular economy 12.0 Support for deep-tech, start-up companies related to GX 40.0 Grant for regional decarbonisation, such as private micro grid 10.0 Total 1,149.8 Source: Japan cabinet secretariat Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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