October 2024 – Page 2 – The Global Carbon Fund

$125 Billion Annual Boost in Nuclear Power Needed to Hit Net Zero, IAEA Says

October 25, 2024/in Uncategorized /by

The 2024 edition of the International Atomic Energy Agency’s (IAEA) Climate Change and Nuclear Power report has been released. It emphasizes the need to significantly boost investments in nuclear energy to meet global climate goals.

The report, launched during the Clean Energy Ministerial (CEM) in Brazil, provides a detailed roadmap for expanding nuclear power and underscores its crucial role in helping countries achieve net-zero emissions by 2050.

How Nuclear Power Could Transform Global Energy

With climate change and energy security concerns intensifying, countries are increasingly looking toward nuclear power as a viable solution. The report highlights that, to reach net zero emissions by mid-century, a rapid expansion of clean energy technologies is essential.

The International Energy Agency (IEA) estimates that achieving net zero carbon dioxide (CO₂) emissions by 2050 will demand annual energy sector investments of $4.7–$5 trillion from 2030 to 2050. This represents a significant increase compared to the $2.8 trillion invested in 2023.

The IEA also projects that achieving net zero by 2050 will require more than doubling the installed capacity of nuclear power. This aligns with the IAEA’s high-case scenario, which, while not a direct net zero pathway, shows similar growth.

In this case, nuclear energy is expected to play a key role, contributing to a diverse and resilient energy mix. According to the IAEA’s high-case scenario, nuclear power capacity needs to increase by 2.5x its current levels by 2050.

Source: IAEA Climate Change 2024 Report

This would provide a reliable source of low-carbon energy, complementing other renewable sources like wind and solar.

The IAEA report stresses that nuclear energy can deliver a steady baseload of clean power, which is particularly important as more intermittent renewable sources come online. This stable power generation can help integrate other renewable energies into the grid more effectively. As such, it ensures that energy supplies remain consistent even when wind or solar resources are low.

Moreover, nuclear power is seen as a critical tool for decarbonizing industrial sectors and supporting advanced energy systems like hydrogen. However, achieving those ambitious nuclear power targets will need substantial investment.

How Much Investment Nuclear Energy Needs

The IAEA estimates that global investment in nuclear energy needs to increase to $125 billion annually. This is up from the current investment of around $50 billion per year between 2017 and 2023. The funding is necessary to build new reactors, upgrade existing infrastructure, and ensure safe operation.

Such a shift is deemed essential for meeting the IAEA’s high-case projection for nuclear capacity expansion by 2050.

For a more aspirational goal of tripling nuclear capacity, which over 20 countries pledged to pursue at COP28, annual investment would need to reach upwards of $150 billion.

Source: IAEA Climate Change 2024 Report

These funds would support three key actions crucial for achieving nuclear power capacity goals:

the construction of new nuclear power plants,
the development of advanced reactor technologies, and
the deployment of small modular reactors (SMRs).

SMRs are particularly attractive for emerging markets and developing countries due to their smaller size, lower upfront costs, and potential for use in remote areas.

IAEA Director General Rafael Mariano Grossi highlighted that while nuclear power plants are cost-competitive and affordable over their long operational lifespans, securing the necessary upfront capital remains a challenge. This is especially true in market-driven economies and developing nations, where access to financing can be limited.

Grossi further noted that:

“The private sector will increasingly need to contribute to financing, but so too will other institutions. The IAEA is engaging multilateral development banks to highlight their potential role in making sure that developing countries have more and better financing options when it comes to investing in nuclear energy.”

Unlocking Private Sector Financing

The report also explores strategies to unlock private-sector finance, a topic that has gained significant attention worldwide.

Last month, during New York Climate Week, 14 major financial institutions, including some of the world’s largest banks, expressed their readiness to support nuclear power projects. These institutions recognize the potential of nuclear energy in achieving climate goals and are willing to contribute to financing new-build projects.

The financial community’s growing interest in nuclear energy is partly driven by recent developments in sustainable finance frameworks. The European Union’s (EU) taxonomy for sustainable activities, which includes nuclear power, has opened the door for new funding opportunities.

In 2023, the first green bonds for nuclear projects were issued in Finland and France – a significant milestone in sustainable nuclear financing.

These developments show a growing recognition that nuclear energy can be a sustainable part of the clean energy transition. By including nuclear power in green finance frameworks, countries can attract more investment to support new projects and refurbish existing reactors.

To bridge the financing gap, the IAEA’s report emphasizes the need for policy reforms and international cooperation. It suggests that countries must develop strong regulatory frameworks and new delivery models to make nuclear projects more attractive to investors.

Additionally, fostering partnerships between governments, financial institutions, and the private sector is essential for mobilizing the necessary capital.

Addressing the Challenges Ahead

Despite the promising outlook, the IAEA’s 2024 report acknowledges the challenges in expanding nuclear power, including:

the need for skilled labor,
supply chain development, and
stakeholder engagement to ensure that new projects are implemented smoothly.

The report also notes the importance of public acceptance and community engagement in advancing nuclear energy projects. In particular, transparent communication about the safety, environmental benefits, and economic impact of nuclear power is essential to gain public support and overcome misconceptions about nuclear technology.

Ultimately, the report highlights that a successful transition to a global clean energy mix will require unlocking the full potential of nuclear power with the right investments and collaboration.

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Li-FT Power Secures $21 Million Through Strategic Private Placement

October 25, 2024/in Uncategorized /by

Li-FT Power Ltd. (TSXV: LIFT) has announced a strategic, non-brokered private placement to raise around $21.25 million. The mineral exploration company focuses on the acquisition, exploration, and development of lithium pegmatite projects in Canada.

Li-FT Power’s flagship project is the Yellowknife Lithium Project (YLP) in the Northwest Territories. Moreover, the company holds 3 early-stage exploration properties in Quebec, and the Cali Project in the Northwest Territories, which is part of the Little Nahanni pegmatite group.

Strategic Investment: A Boost for Canadian Lithium Projects

The lithium company’s newly announced private placement includes:

Flow-Through Shares: 2,694,895 shares priced at $5.6575 each.
Hard-Dollar Shares: 1,645,000 shares priced at $3.65 each.

This investment will be made by a single purchaser, who already holds 363,918 shares of Li-FT. Upon closing, the purchaser will own a total of 4,703,813 shares, equivalent to a 9.99% stake in the company.

As part of this strategic investment, Li-FT and the purchaser will negotiate an investor rights agreement, including customary terms.

Use of Funds:

Proceeds from the hard-dollar shares will support the development of Li-FT’s Canadian projects and general corporate purposes.
Funds from the flow-through shares will be allocated to Canadian exploration expenses, specifically for the company’s Northwest Territories projects. These expenditures qualify as flow-through critical-mineral mining expenses under Canadian tax laws, and all such costs will be renounced to subscribers by December 31, 2024.

The transaction is expected to close on or before November 12, 2024, subject to certain conditions. These include the completion of agreements with the purchaser and approval from the TSX Venture Exchange.

Shares issued will have a hold period of four months and one day, as per Canadian securities regulations. Canaccord Genuity served as a financial advisor to Li-FT in this strategic investment.

Flagship Project and Other Strategic Ventures

In September, Li-FT Power expanded its Cali Project in the Northwest Territories, quadrupling its land position by adding 9,681 hectares. This move follows amendments to the Sahtú Land Use Plan, allowing the company to secure new claims, including spodumene pegmatite deposits that extend the existing Cali dyke swarm.

SEE MORE: Li-FT Quadruples Cali Property Through Staking, Boosts Lithium Prospects

The company’s 2023 exploration revealed substantial lithium prospects at Cali. Field visits and surface exploration identified a larger-than-expected dyke system. Out of 163 samples, 124 had lithium grades above 1.0% Li₂O, prompting further drilling plans.

CEO Francis MacDonald noted that the low-cost acquisition strategy enhances the project’s lithium potential. Moreover, Li-FT terminated its Shorty West claim agreement with Infinity Stone Ventures Corp.

Li-FT is committed to advancing multiple lithium projects in Canada, including the YLP and other early-stage sites in Quebec.

Earlier this month, the lithium company revealed its maiden mineral resource estimate (MRE) for the YLP in the Northwest Territories, Canada. This estimate solidifies the YLP as a significant spodumene resource, ranking it among the top 10 in the Americas and the third-largest hard-rock lithium deposit in Canada.

The initial MRE reveals 50.4 million tonnes with 1.00% lithium oxide (Li₂O), translating to 1.25 million tonnes of lithium carbonate equivalent (LCE). The estimate covers 8 of the 13 spodumene-bearing dykes on the property. It has the potential for further resource growth as drilling continues.

The project’s strategic location offers infrastructure advantages, including proximity to highways and railways, enhancing logistics for potential future exports. The company plans a Preliminary Economic Assessment (PEA) by Q2 2025, which will assess the project’s viability. The goal is to establish the Yellowknife Lithium Project as a major player in the North American lithium supply.

The recent private placement is yet another milestone for Li-FT Power’s growth strategy, enhancing its position in the growing lithium market.

Disclosure: Owners, members, directors and employees of carboncredits.com have/may have stock or option position in any of the companies mentioned: LIFT

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Why Are Major Companies Abandoning ‘Cheap’ Carbon Offsets? Bloomberg Explains.

October 25, 2024/in Uncategorized /by

Once a trustworthy path to meet climate goals, carbon offsets are losing favor among many top corporations. Companies like Delta Airlines, Google, and EasyJet were once top buyers of these credits. But now they have stepped back or have completely stopped purchasing offsets related particularly to renewable energy projects.

Renewable-Energy Offsets Lose Steam

This change in mindset reflects that such carbon offsets do not deliver the environmental benefits they promise. Instead of buying offsets, many companies are trying to directly reduce their emissions. This process is tougher and costlier than buying offsets.

A Bloomberg Green analysis of public offset transaction records shows a significant sales decline for the second consecutive year. This clearly indicated a trend towards fewer offset purchases.

Lambert Schneider, a carbon markets expert from Öko-Institut in Germany, emphasized that scientific reports have repeatedly questioned the “credibility” of such offsets, casting doubt on their contribution to genuine emissions reduction.

A closer look at the carbon offset market shows a sharp decline in renewable-energy credits, which dropped 29% in 2023. Historically, these offsets funded wind, solar, and hydroelectric projects. However, critics argue that many of these projects would be financially viable without the credits. Thus, their additional environmental benefits are questionable.

These concerns prompted the Integrity Council for the Voluntary Carbon Market (ICVM) to refuse its “Core Carbon Principles” label to renewable-energy offsets earlier this year.

This decision labeled many of these credits as “junk” or ineffective for the environment and leading companies like Chevron, JetBlue, and BP withdrew from them.

New Carbon Markets Could Offer Renewable Offsets a Second Life

Bloomberg has come up with another interesting analysis. Despite dwindling interest in renewable-energy credits, these offsets could see a revival. They may still attract buyers in a new regulatory setting. This framework aims to standardize international carbon trading and hold companies accountable.

At the upcoming COP29 climate summit in Azerbaijan, discussions will revolve around establishing a UN-backed carbon trading market for countries and corporations with climate commitments.

New registries, such as Qatar’s Global Carbon Council are stepping in and regenerating interest in renewable-energy credits. However, many environmental experts warn that these registries may perpetuate “junk” credits that provide no meaningful climate impact. Consequently undermining the credibility of the offset market.

Big Names Step Back, but Not All Abandon Carbon Offsets

As Bloomberg highlighted the companies that ditched these renewable carbon offsets, a few companies still back these credits. TotalEnergies, Shell, and Engie still support renewable-energy offsets, expressing confidence in their effectiveness and investments.

New buyers like Japan’s Kobe Yamato Transport and Colombia’s Grupo Argos, have also entered the market despite the rising skepticism.

On the other hand, some companies are moving entirely away from offsetting and focusing on verified carbon-removal technologies, which draw carbon directly from the atmosphere.

For example, Jet2 is shifting its resources towards sustainable aviation fuel (SAF), while Ernst & Young is halting renewable-energy offset purchases altogether. As public scrutiny grows, more companies are choosing to invest in impactful sustainability solutions rather than cheap credits.

Danny Cullenward, a researcher at the Kleinman Center for Energy Policy, emphasizes the need for accountability. He said,

“The problem won’t disappear until there’s greater responsibility for misleading claims in the voluntary carbon market.”

The Future of Carbon Offsets: An Evolving Market

Due to opposition to renewable energy offsets, the largest public registries, such as Verra and Gold Standard, have stopped participating in the majority of renewable energy projects and are restricting the credits’ origins to the least developed nations.

As businesses reassess their sustainability plans, the future of carbon offsets is still unclear. The market for premium carbon reductions is expanding, but the demand for inexpensive credits is declining.

According to Bloomberg, only credits with verifiable environmental benefits will maintain long-term market interest. Some businesses, meanwhile, are clinging to the prospect that the carbon offset sector would eventually get credibility and order from UN-backed rules.

Until then, companies that value credible, science-based approaches to sustainability are increasingly stepping away from traditional offsets. On a positive note, they are setting more impactful and direct emissions reduction targets to fight climate change.

CONTENT SOURCE: Carbon Offsets See Falling Demand but COP29 May Open New Market – Bloomberg

LATEST: CDR and Carbon Credits: NASDAQ Surveys the Key Trends Shaping Corporate Sustainability

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Biden’s IRA Spurs $34 Billion U.S. Solar Boom, But Can It Overcome Industry Risks?

October 25, 2024/in Uncategorized /by

The U.S. solar industry has seen a rapid expansion since President Joe Biden signed the Inflation Reduction Act (IRA) in August 2022. The act has been instrumental in increasing domestic solar panel production capacity more than fivefold. This is a crucial step in Biden’s goal of building clean energy supply chains within the country.

Globally, the International Energy Agency (IEA) recently published its World Energy Outlook 2024 which shows that solar power generation could increase fourfold by 2030. The report suggests that solar energy could be a leading source of electricity by 2033, surpassing nuclear, wind, hydro, and natural gas. It could eventually even overtake coal, positioning itself as the largest electricity source globally.

IRA Fuels Solar Investments but Leaves Gaps

Renewable energy is set to significantly outpace electricity demand growth, per IEA data. In one scenario renewable output is expected to expand by nearly 2,200 TWh by 2035, more than tripling its 2023 level. This increase will boost renewables’ share of electricity generation from 22% to 58%, with solar PV seeing the largest growth.

Key factors of this growth include high-quality renewable resources, established markets with low technology costs, and strong federal and state policy support.

The IRA is a cornerstone of Biden’s clean energy policy. It offers up to $1.2 trillion in tax incentives over 10 years. These incentives aim to boost the production and deployment of clean energy technologies.

One of the IRA’s key elements is the advanced manufacturing tax credit, which has led to over a dozen new or expanded solar module manufacturing plants across the U.S.

Since the IRA’s passage, solar companies have invested over $34 billion in building new factories.

According to federal data, the U.S. now boasts over 45 gigawatts (GWdc) of solar module manufacturing capacity. At maximum production, these facilities could meet most of the U.S. solar demand expected by 2025 as reported by S&P Global Commodity Insights.

However, the solar industry’s expansion has not been uniform. The bulk of investments has gone into the assembly of modules, trackers, inverters, and other downstream components. In contrast, there’s a lack of domestic production for crystalline-silicon ingots, wafers, and cells—key components of the solar supply chain.

Navigating Market Risks and Government Support

Industry leaders see these gaps as a significant hurdle to achieving a fully self-reliant solar industry.

Ray Long, the president and CEO of the American Council on Renewable Energy, describes this surge as a “clean energy manufacturing renaissance.” Despite the positive momentum, Long emphasizes that the rapid growth of solar manufacturing in the U.S. comes with challenges.

For instance, the potential threat from cheaper Asian imports is one challenge. Some U.S. manufacturers seek more federal support to level the playing field, believing that additional measures are necessary to ensure their success.

Moreover, the outcome of the upcoming presidential election could significantly shape future policies. While both political camps support bringing manufacturing back to the U.S., their strategies differ.

Donald Trump, for example, advocates for broader tariffs on imports, which could raise costs for consumers. Kamala Harris, on the other hand, criticizes such tariffs as a “sales tax” on American buyers.

Experts believe that consistent support from the federal government is crucial to sustain the growth of domestic solar production.

Notably, the U.S. Treasury Department is working to enhance support for the solar industry. It recently clarified that solar ingot and wafer manufacturing facilities qualify for a 25% investment tax credit under the 2022 CHIPS and Science Act.

Solar Industry Moves Forward Despite Challenges

Industry leaders are divided on the future direction of U.S. solar manufacturing. Some are optimistic about the role of government support in boosting domestic production.

Steven Zhu, president of Trina Solar (U.S.) Inc., emphasized the importance of diversifying manufacturing locations, including expanding into the U.S., to manage risks from policy changes. Trina Solar is set to open a 5-GW solar module facility in Texas, with plans to expand production in 2025.

Yet, others are skeptical about the sustainability of new U.S. solar plants. T.J. Rodgers, CEO of residential solar company Complete Solar and former chairman of SunPower, argues that most of the new solar factories in the U.S. are unlikely to be profitable without continuous government subsidies. He believes the reliance on taxpayer support to maintain operations could become a long-term challenge for the industry.

These varying perspectives reveal the uncertainty surrounding the U.S. solar manufacturing industry, especially with the presidential election approaching. While both parties agree on the importance of reducing reliance on Chinese solar components, their differing approaches could significantly impact the industry’s trajectory.

Worldwide, the IEA forecast shows that solar and wind energy could transform the global power landscape, potentially contributing nearly 60% of global electricity by 2050. The agency further projects that solar power alone could see a massive expansion. It can go beyond 16,000 gigawatts (GW) by 2050, compared to today’s levels.

In the U.S., renewable energy sources are on track to grow much faster than the electricity demand. Under one scenario, STEPS (Stated Policies), solar power will see the most significant growth. Together with wind energy, together they could provide 50% of electricity by 2035, up from 15% in 2023.

Ultimately, the U.S. solar manufacturing sector is in a period of rapid growth, driven by strong demand for renewable energy and significant federal incentives. As solar companies push forward with ambitious expansion plans, their success will depend on continued government support and favorable market conditions.

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Tesla’s $739 Million Carbon Credit Revenue Fuels Q3 Earnings Surge

October 24, 2024/in Uncategorized /by

Tesla delivered better-than-expected 3rd-quarter earnings and profits, bringing relief to investors while reversing a trend of declining earnings. The electric vehicle (EV) maker saw its first year-over-year profit growth in 2024, beating expectations in its 2024 Q3 report.

More remarkably, Tesla shows an impressive $739 million carbon credit, also called regulatory credits, revenue for the said quarter. The company reaffirmed its plans to make its EVs more affordable, which added to investor enthusiasm.

Tesla Recharges Earnings with Cash Flow from Carbon

The EV giant’s revenue rose 7.8% year-over-year to $25.18 billion, although this fell short of analyst forecasts. However, the company outperformed on its bottom line.

It reported adjusted earnings of $0.72 per share versus the $0.60 expected, up from $0.66 a year ago, with a net income of $2.5 billion. This beat analyst expectations, which had an estimated $0.59 per share and $2.01 billion in net income.

Tesla’s operating margin climbed to 10.8% of sales, up from 6.3% in the previous quarter and 7.6% in Q3 of last year. The company’s net income grew by 8% compared to last year, breaking a streak of four consecutive quarters of declining profits.

Tesla noted that it is currently between “two major growth waves,” suggesting optimism for the future. It also shared an upbeat outlook on vehicle deliveries, predicting “slight growth” this year. This came as a surprise since market forecasts had expected deliveries to dip from 1.81 million in 2023 to 1.78 million.

Following this announcement, Tesla’s stock jumped about 12% in after-hours trading, adding about $81 billion to the company’s market value.

Another big standout from the earnings report is Tesla’s carbon credit revenue totaling $739 million. The figure is well above the $539 million analysts had predicted and an increase of 33% year-over-year.

How Carbon Credit Sales Boosted Tesla’s Profits

More notably, these credits bring full profits to the company and account for almost 34% of its net income ($2,183 million). This Q3 carbon credit sale is the second-highest since Tesla started selling them in 2009. The highest was during the previous quarter.

These credits, which Tesla sells to traditional carmakers to help them meet emissions obligations, provide significant profits as they can be sold at 100% full margins. Thus, carbon credits have played a pivotal role in Tesla’s overall financial performance.

Since the EV maker began selling carbon credits to other companies, this revenue stream has turned into a billion-dollar opportunity. In the past year, Tesla earned $1.79 billion from carbon credits, marking its highest-ever annual income from automotive regulatory credit sales.

While details about Tesla’s carbon credit buyers are often undisclosed, Chrysler is known to have purchased $2.4 billion worth of credits by 2022. Stellantis, a major auto group, has also been involved, buying significant credits to offset emissions as it targets zero emissions by 2038. This highlights the challenges automakers face in reducing carbon footprints, given the high emissions associated with key EV components like batteries, steel, and aluminum.

China remains another vital market for Tesla’s carbon credit sales. Reports indicate that a joint venture between Volkswagen and FAW Group in China might have purchased credits from Tesla, potentially earning Tesla around $390 million in 2021. However, details about specific buyers in China remain unclear.

Driving Forward: Tesla Eyes 25-30% Delivery Growth

The positive momentum continued as CEO Elon Musk addressed investors during the earnings call. Musk forecasted a 25% to 30% increase in Tesla deliveries for next year and announced plans to roll out a self-driving taxi, Robotaxi, service in California and Texas by 2025.

Tesla had previously announced that it delivered 462,890 vehicles in Q3, with production totaling 469,796 units. About 3% of these deliveries were under operating lease accounting.

This figure compares to 443,956 vehicles delivered in Q2 of this year and 435,059 in Q3 of last year. Tesla’s all-time delivery record remains at 484,507 units, achieved in Q4 2023.

Looking forward, Tesla emphasized that its plans to produce new, more affordable vehicle models remain on track, with production expected to begin in the first half of 2025.

Beyond EVs: Energy Storage Sets New Records

Tesla’s energy storage business also showed strong performance. Although energy storage deployments decreased sequentially in Q3, they hit a record 6.9 GWh, up 75% year-over-year.

Tesla highlighted that energy services and other segments are increasingly contributing to the company’s profitability. It anticipates continued profit growth from these segments as energy storage products scale up and its vehicle fleet expands.

Additionally, Tesla advanced its efforts at Gigafactory Texas, where it is building a high-performance 29,000 H100 cluster, aiming for 50,000 H100 capacity by the end of October.

The energy storage market significantly influences Tesla’s strategy, especially as it diversifies into energy solutions beyond EV manufacturing. This shift is evident in Tesla’s growth in energy storage deployments, with key products like the Powerwall and Megapack battery systems.

In 2023 alone, Tesla deployed 14.7 GWh of energy storage, generating $6.035 billion in revenue—a 3x increase since 2020.

Tesla’s energy storage segment’s growth aligns with the broader clean energy transition, especially as demand for storage solutions rises to balance renewable energy production.

SEE MORE: Tesla Signs A Landmark Multi-Billion Dollar 15 GWh Megapack Deal

Tesla’s Q3 2024 earnings report reaffirms that carbon credit revenue remains a crucial part of its financial performance. It allows the carmaker to boost earnings while continuing its push toward more affordable EVs and expanded energy solutions.

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Coal to Stay in India’s Energy Mix: Can Sustainable Mining Control Emissions?

October 24, 2024/in Uncategorized /by

India’s energy demand is growing in leaps and bounds. The country is progressing ahead and investing heavily in renewables. However, with this rising energy demand, coal is once again holding its ground stronger in the nation. The recent World Energy Outlook report revealed that,

“Coal is set to retain a strong position in the energy mix in India over the next decades.”

The Stated Policies Scenario (STEPS) assessed that approximately 60 GW of coal-fired capacity will be added to the net of retirements by 2030. This will surge electricity generation from coal by more than 15%.

The Coal Scenario of India

India is the world’s second-largest producer of coal, so coal is abundantly available in India. It holds a major 55% share of the country’s energy demand. The reality is, that replacing coal with 100% renewables is not happening anytime soon. The most significant factor that’s fueling coal demand is the rising population.

This manifests energy usage at homes, buildings, factories, and offices directly. Only Renewables like solar, wind, and hydro might not fulfill such a massive energy demand in a heavily populated country. This is why India’s indigenous sector – coal is so important.

World Energy Outlook has figured out:

“Generation from coal remains over 30% higher than that from solar PV even in a decade in which solar PV accounts for twice as much capacity, owing to the lower capacity factor of solar installations.”

2035 Coal Consumption Forecast

Some of the most energy-consuming sectors are going to experience a massive demand uptick. They are:

The iron and steel sector can grow by 70%
Cement output is expected to surge by 55%
The stock of air conditioners can become 4-5X

Thus, the consumption of coal in industry can grow by 50% by 2035.

Source: World Energy Outlook

Will Rising Demand Ignite a Carbon Emission Surge?

This is the most inevitable question, and IEA has come up with an interesting analysis:

India’s GDP growth rate is currently 7.8%. Subsequently, the government has ambitiously set a target to have the third largest economy in the world by 2030, after the U.S. and China.

Any form of economic growth involves expanding infrastructure. Development in spaces and structures, new constructions, and increased transportation will require cement, steel, concrete, iron, fuel, power, etc. This can cause a sharp rise in energy demand and use of fossil fuels.

So, the answer is eventually becoming clear- and carbon emissions can substantially rise in the future as India strives to have a more powerful economy.

The US EPA quoted,

“India’s coal emissions are estimated to be 22 MtCO2e in 2020 and are expected to reach 45 MtCO2e in 2050.”

If Coal has a Future; India is Sustainably Mining It

However, the coal and lignite undertakings are responsibly handling the environmental impact of the coal mining process. The most widely used mitigation measures include recycling mined-out areas and carrying out extensive plantations in coal-rich regions.

The Ministry of Coal has been seriously taking steps to restore the land disrupted by mining. They have stabilized such lands and put them into useful purposes. The process is precisely known as, “ecological reclamation of mined land”. Some such measures are:

reforestation of overburden dumps
afforestation around mines
restoring local flora and fauna

Notably these activities are planned in advance and the closure plans are approved by the ministry. They conduct them sidewise to minimize the carbon footprint post-closure of coal mines.

Improving the Air Quality

The Ministry highlighted innovative techniques like seed ball plantation, drone-based seed casting, and Miyawaki plantation that have been introduced in several mines. These techniques combat air pollution by “trapping” the enormous volume of dust particles blown off during mining. The entire process is monitored through remote sensing technology to ensure maximum efficiency.

Additionally, the latest technologies like surface miners, wheel washing, fog cannons, mist sprayers, mechanized road sweepers, CAAQMS, wet drilling, and dust suppression systems are also deployed to minimize dust generation. This improves the air quality of the surrounding areas of a coal mine.

Image: Surface Miner with water jets, Gevra OCP, SECL

Source: Ministry of Coal

India’s coal companies are also implementing several energy-efficient measures to reduce their carbon footprint. The Ministry of Coal said,

“By implementing various energy efficiency measures, Coal/lignite PSUs have envisaged to create additional carbon offset potential of 1 Lakh Ton/annum.”

Source: World Energy Outlook

The Bureau of Energy Efficiency (BEE) Announces Offset Mechanism to Combat Emissions

As we discuss sustainability in the Indian coal mining sector, another important piece of news that made headlines is India’s national carbon market and trading carbon credits. We discovered from S&P Global what the Bureau of Energy Efficiency (BEE) said recently.

BEE’s Director, Saurabh Diddi, stated that by March 2025, they will unveil the methodologies for sectors included in phase 1 of the domestic voluntary market under India’s Carbon Credit Trading Scheme.

S&P Global noted that India has immense opportunities in the domestic voluntary market and is the largest supplier of carbon credits in the existing international voluntary carbon markets.

The methodologies can encourage industries and corporations to commit to “voluntary” emission reduction targets. Diddi added that such pledges would help boost demand for carbon credits. Simply put, the whole purpose is to generate demand in the domestic offset market.

This diverse range of decarbonization strategies including sustainability in Indian coal mining are meant to achieve net zero emissions by 2070. Additionally, these offset mechanisms can reduce 45% of its GHG emissions by 2030.

LATEST: India’s Cleantech Boom: Can It Challenge China’s Reign?

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$7.1 Billion Investment Fuels Fusion Commercialization. Is Fusion the Future Energy?

October 24, 2024/in Uncategorized /by

Fusion is the future of energy, and that’s becoming increasingly evident. How? Well, recently tech giant Microsoft invested generously in Helion Energy as it recognized fusion’s potential to revolutionize the energy transition.

Andrew Holland, CEO of the Fusion Industry Association explained this very nicely by stating,

“The fusion industry is poised to help the world achieve the energy transition to net zero carbon emissions. Commercialization of fusion energy will create new jobs and a new industry addressing a trillion-dollar market.”

Recently they published the Global Fusion Industry Report that highlights how the race to commercialize fusion energy is speeding up. We discovered that forty-five companies are putting in various technological efforts and have raised over $7 billion in investments till now. Notably, with public-private partnerships the funding has seen a 50% jump.

President Biden and his climate agenda are one of the propellers for addressing the climate crisis. The US DOE says fusion energy has immense potential to meet carbon reduction targets, ensure energy security, and promote economic growth.

Moving on, let’s understand what is fusion.

Fusion and Its Fuel

In Chemistry,

“Nuclear fusion is the process by which two light atomic nuclei combine to form a single heavier one while releasing massive amounts of energy. The sun, along with all other stars, is powered by this reaction.”

IAEA says, Fusion could generate 4X more energy per kilogram of fuel than fission (used in nuclear power plants) and nearly four million times more energy than burning oil or coal.

From this estimate, we can fathom the impact of fusion in the future once it’s fully deployed. Secondly, there are particular fuels that trigger fusion. The deuterium-tritium (D-T) fuel is the most efficient for fusion devices.

As fusion produces safe, clean, and infinite energy, it’s crucial to find a viable fuel source to power the process. Top fusion companies are working on several other alternatives along with D-T. A few examples are proton–boron (pB11), deuterium–helium3 (DHe3), and lithium.

However, turning this into reality involves rigorous R&D and investments. And this is why public-private partnerships have become inevitably important for the fusion industry.

Public-Private Partnerships Drive Fusion Commercialization

One cannot overlook the role of public-private partnerships as they are the driving factor behind the commercialization of fusion energy. Government funding to support private companies has jumped by over 50%. This indicates a keen interest from national governments. The investment figures are shown below:

While private companies will take charge of the commercialization, public partnerships will drive scientific research and emerging technologies. The Fusion Industry Association has consistently pushed for such collaborations to ensure that private companies can leverage maximum knowledge from public research programs.

Several notable public-private partnerships have gained momentum in the past year. In June 2024, the U.S. DOE signed contracts with eight companies under the Milestone-Based Fusion Development Program to deliver pilot plant designs. Even ITER, the global leader in fusion research, is embracing public-private partnerships by offering its expertise to private companies.

Germany launched its “Fusion 2040” initiative, directly investing in private companies, while Japan’s “Moonshot” program and the UK’s “Fusion Futures” are backing key technology providers. Meanwhile, the EU plans to establish a fusion investment consortium by 2026.

Potential Markets for Fusion Energy

The demand for fusion commercialization can be met only with international cooperation. This is because such partnerships can overcome research challenges, boost supply chains, and train workforces.

Thus, building a global fusion energy market requires turning rigorous R&D efforts into commercial technologies. Fusion developers aim to export facilities worldwide. This can help us understand the diverse commercial landscapes essential for global collaboration.

The DOE has outlined a pathway of how international partners can support fusion’s entry into these markets. The steps are:

Identifying necessary technologies, manufacturing, and infrastructure for fusion development, while mapping global supply chains to target high-value markets.
Exploring common benchmarks and standards.
Engaging with industry groups, consortia, and NGOs to address commercial and community needs.
Helping multinational companies benefit from technologies developed outside their home countries.

Additionally, coordinating early on regulatory frameworks and policies will also ensure a smooth market entry for fusion energy. This will also involve scaling from prototypes to real-world solutions. However, with major advancements, protecting intellectual property will also become crucial for R&D, commercialization, and global partnerships.

Take a peek at the following chart to discover the industries where fusion energy will be useful.

Commonwealth Fusion Systems: Leading the Pack

Located in Devens, Massachusetts, Commonwealth Fusion Systems is the world’s largest commercial fusion energy company. To date, it has secured around $2 billion in funding having a primary market for electricity generation.

The company aims to deploy fusion power plants quickly to meet rising global energy demands and achieve decarbonization goals. It specializes in making tokamaks (a magnetic confinement device to generate thermonuclear fusion) with innovative high-temperature superconducting (HTS) magnet technology. The company is currently building SPARC, a Q~10 demonstration plant that uses actual fusion fuels based on peer-reviewed science. Catch a glimpse of the reactor here.

Source: CFS

Recently the power giant produced two advanced superconducting magnets for the University of Wisconsin’s WHAM experiment, which is exploring magnetic mirror fusion. These are the first products shipped under CFS’s plan to supply magnets for both its power plants and other innovative uses.

While CFS’s main focus is building its own fusion devices, including the SPARC tokamak, its cutting-edge magnet technology has broader potential. Several companies have already approached CFS for its expertise in developing high-temperature superconducting magnets for various markets.

The top fusion companies are charted in the image below:

“Recreating the conditions in the center of the Sun on Earth is a huge challenge”

The above statement was said by Dr. Aneeqa Khan, lecturer in nuclear materials at the University of Manchester to BBC. Building a fusion power plant involves complex engineering and material challenges. It also requires trained and a large workforce with precision and skills to work in this field.

Understand the diverse challenges of the fusion sector from this figure:

Commercial fusion power will still take time to develop. However, investment in fusion is surging and the companies are making steady progress to bring this technology to the world sooner in the future.

Disclaimer: Data and Visuals Collected from 2024 Global Fusion Industry Report

FURTHER READING: Google and Kairos Power Unveil Groundbreaking 550 MW Nuclear Energy Initiative

The post $7.1 Billion Investment Fuels Fusion Commercialization. Is Fusion the Future Energy? appeared first on Carbon Credits.

How Toyota’s Hydrogen Cartridges Will Change EVs Forever

October 23, 2024/in Uncategorized /by

Toyota is redefining the future of clean energy with its portable hydrogen cartridges showcased recently at the Japan Mobility Bizweek 2024. This cutting-edge technology could change how we power vehicles and appliances simultaneously offering a quick and sustainable alternative to time-consuming electric vehicle (EV) charging. Let’s explore it.

In March, Primearth EV Energy (PEVE) became fully owned by Toyota. On October 1, the company celebrated its new name, Toyota Battery, with a ceremony. President Masamichi Okada expressed his gratitude and promised to lead Toyota Group’s push toward electrification. He said,

“It goes without saying that we will contribute to the multi-pathway strategy with batteries for HEVs (hybrid electric vehicles), PHEVs (plug-in hybrid electric vehicles), and BEVs (battery electric vehicles), as well as secondary batteries for fuel cell vehicles. In addition, we want to explore all possible ways of supporting Toyota’s commitment to developing hydrogen-engine vehicles, including the potential for batteries to extend the cruising range or reduce fuel tank size.”

Portable Hydrogen Cartridges: A Game-Changing Innovation

Originally developed by Toyota’s mobility subsidiary, Woven, the hydrogen cartridge concept has come a long way since its initial prototype in 2022. Today, the cartridges are lighter, more compact, and easier to transport. In a way, they resemble giant AA batteries.

The press release says, that with these portable fuel sources, Toyota aims to solve one of the biggest challenges for hydrogen fuel cell electric vehicles (FCEVs): the need for refueling infrastructure with costly hydrogen pipelines.

Unlike conventional EVs that rely on electricity and can take hours to charge, Toyota’s hydrogen cartridges offer a swappable, portable power source.

Drivers can easily and quickly replace a depleted cartridge with a full one.
Enhances the driving experience and drivers can get back on the road faster.
Gives a major boost to hydrogen-powered mobility and is a potential game-changer for reducing EV downtime.

Source: Toyota

Multiple Uses Beyond Vehicles

But Toyota’s vision for these hydrogen cartridges goes beyond just fueling cars. The company imagines them powering everything from motorcycles to home appliances. They could even be used for cooking, as Toyota and Rinnai Corporation demonstrated at the event with a hydrogen-powered stove. We can say, that this technology brings renewable energy directly to consumers without disrupting existing systems.

In emergencies, these cartridges could be removed from vehicles and used to power devices during blackouts. Toyota envisions a world where hydrogen cartridges can be delivered to homes alongside groceries and other essentials. Spent cartridges would be collected, refilled, and redistributed—creating a seamless system for hydrogen distribution.

Moreover, hydrogen is produced using renewable energy sources which is a great way to meet net-zero goals without relying on fossil fuels. Hydrogen can generate electricity, store energy, and burn for heat. But it emits only water and not carbon dioxide.

The new-age fuel has gained good momentum as BMW, Hyundai, and Honda are also exploring hydrogen potential. Worth mentioning, that it goes beyond the automotive sector. It could be used to power airplanes, heavy machinery, and industrial processes.

Toyota Envisions a Hydrogen-Powered Future

Toyota’s hydrogen cartridges could certainly build a more sustainable, efficient energy network. They are just bringing its vision of a hydrogen-powered future closer to reality.

The company has already well established itself in the hydrogen space. Its hydrogen-powered Corolla has been on the road since 2021. However, Toyota’s sustainability vision isn’t limited to hydrogen. The company is also investing heavily in battery technology, as we read before.

The Sweep Energy Storage System

One of the key exhibits at Japan Mobility Bizweek is Toyota’s Sweep Energy Storage System, which recycles used batteries from hybrid and electric vehicles. This system maximizes the remaining energy capacity of used batteries, supporting the wider adoption of renewable energy sources like solar and wind.

Toyota is building a circular economy with the Sweep System. The company’s focus on reducing waste and reusing materials is central to its sustainability strategy. Toyota’s innovations in both hydrogen and battery technology demonstrate its commitment to a greener future

The Road to Carbon Neutrality

Toyota aims to reach carbon neutrality across its entire vehicle life cycle by 2050. This goal involves reducing and offsetting greenhouse gas (GHG) emissions to achieve net zero across operations, manufacturing, logistics, and the full product cycle, from use to recycling. Furthermore, their science-based targets streamline their efforts to reduce emissions from every stage of the vehicle lifecycle.

Source: Toyota

The Japanese automaker firmly believes battery electric vehicles (BEVs) and hydrogen fuel cell electric vehicles (FCEVs) will rule the future. As these sustainability technologies develop, hybrids (HEVs), plug-in hybrids (PHEVs), and vehicles running on lower-carbon fuels will play a crucial role in their transition strategy.

Additionally, Toyota is collaborating with startups and other businesses to push hydrogen and renewable energy technologies further. These partnerships will advance its hydrogen cartridge concept and make the fuel cells commercially viable.

FURTHER READING: Toyota to Sell 200,000 Hydrogen-Powered Vehicles, Targets China & Europe Market

The post How Toyota’s Hydrogen Cartridges Will Change EVs Forever appeared first on Carbon Credits.

CDR and Carbon Credits: NASDAQ Surveys the Key Trends Shaping Corporate Sustainability

October 23, 2024/in Uncategorized /by

Corporate buyers continue to rely on traditional carbon credit purchasing methods. Meanwhile, potential buyers of carbon removal credits need more education before committing to these newer options. This year’s NASDAQ survey revealed that even though companies are interested in CDR credits, a major proportion is unaware of the latest technologies like enhanced rock and coastal weathering, enhanced coastal weathering, ocean alkalinity enhancement, etc.

The survey revealed:

Support for maximizing the impact of carbon credit purchases increased from 25% in 2023 to 27% in 2024.
Support for offsetting emissions with carbon removal credits decreased from 24% in 2023 to 22% in 2024.

CDR: A Vital Tool for Achieving Net Zero

Carbon dioxide removal (CDR) is crucial for companies striving for net zero. Since Nasdaq’s first Global Net Zero Pulse survey, the voluntary carbon market (VCM) has evolved with new corporate feedback, updated SBTi guidelines, and U.S. government advice. The VCM allows companies to voluntarily buy credits that fund projects reducing emissions.

It is a well-known fact that limiting global warming to 1.5°C still requires removing massive amounts of CO2. Another proof is the palpable rising heat that emphasizes the urgency.

However, with growing concerns about greenwashing, companies are being more careful. This creates an opportunity to explore new CDR credit options with better risk protection. Companies must also closely examine their buying preferences for both traditional and new carbon removal efforts.

Companies need to evaluate the importance of the following criteria before buying carbon removal credits.

From June to July 2024, Nasdaq ESG Advisory conducted a survey focused on corporate buyers to explore market demand. The survey covered three key themes to help scale the VCM and drive CDR adoption.

1. Corporate Net Zero Alignment

Companies are increasingly adopting alternative strategies to reduce their emissions, but some emissions remain beyond their control. This is where they need carbon dioxide removal (CDR).

Currently, 40% of corporate buyers understand their company’s path to reducing emissions between 2024 and 2030. They also give importance to CDR.
About 30% expect to cut emissions by up to 40% without using CDR credits, while 31% plan to reduce emissions by up to 60% by 2030 before turning to CDR.

By 2050, the number of companies aiming for 80% or greater will become 3X. This indicates that CDR credits play a vital role in these efforts, with 87% of corporate buyers recognizing their importance in their net-zero strategies.

Moreover, B2C companies are more involved and use CDR as a key part of their strategy. This also shows the growing consumer demand for sustainable tools.

2. Carbon Credits Purchase Strategies

More companies, including those that haven’t been active in carbon markets before, are now planning to buy carbon credits. In the past, some companies have purchased carbon credits to offset emissions, but now even more are showing interest. This highlights rise in corporate demand for carbon credits.

Survey findings reveal a growing trend toward purchasing carbon reduction, avoidance, and removal credits. The energy and materials sectors, especially industries like cement, steel, and chemicals, are leading this shift. These sectors are hard-to-able and face considerable challenges to reducing their emissions. Thus, making carbon removal credits a key part of their mitigation strategy.

Additionally, corporate sectors are now aligning their carbon credit buying plans with their overall sustainability goals with a robust strategy in place. Another interesting factor is- corporate buyers tend to prefer locally sourced carbon credits. The report showed that this trend is especially strong in Canada and Asia-Pacific, where about two-thirds of respondents prefer to purchase local credits.

NASDAQ revealed,

While in 2024, less than 10% of respondents expect to abate 80% or more of their emissions with CDR, this increases by 1.5x in 2030 and 2x in 2050.

This upward trend is particularly noticeable among sectors like information technology, financial services, consumer staples, and utilities.

Understanding the Scope of Emissions

Many companies are uncertain about how carbon dioxide removal will fit into their plans for reducing current emissions and in the future. A significant number of respondents in recent surveys expressed doubts about their understanding of how much of their Scope 1 and 2 emissions can be reduced through CDR.

This is the reason why they hesitate to use carbon dioxide removal (CDR) until they have significantly cut their emissions. Companies not including CDR in their strategy often focus on cutting emissions first.

Another complex scenario is reducing Scope 3 emissions, which encompass the largest portion of a company’s total emissions but are often the hardest to tackle. Consequently, companies having solid knowledge of this platform are using CDR to address these challenging Scope 3 emissions.

However, even though companies are facing uncertainties in their emissions profiles, CDR will be crucial to meet their sustainability goals.

The following figure indicates the expected percentage of a company’s emissions to be abated using high-quality carbon removal credits.

3. Carbon Market Dynamics

The report has thrown light on how companies’ decarbonization and carbon credit strategies are influenced by changing policies and regulations. While carbon removals were mostly unregulated, rising concerns from stakeholders have caught the attention of regulators. As a result, the voluntary carbon markets are now under more scrutiny.

Since last year’s survey, several major policies were introduced by the SEC, California Air Resources Board (CARB), Federal Trade Commission (FTC), and European Commission (EC). These climate-related policies are putting pressure on both public and private companies.

In fact, 72% of respondents reported feeling the impact, especially from the SEC’s Climate Disclosure Rules and California’s AB-1305.

Interestingly, a deeper look reveals regional differences. Canadian respondents said these policies directly affect their carbon credit strategies. On the contrary, fewer U.S. (72%) and European (60%) respondents felt the same impact. U.S. and Canadian companies are primarily focused on the SEC’s Climate Disclosure Rules and California’s AB-1305.

In Europe, 33% of companies are more focused on EU regulations, which ban greenwashing and require companies to verify environmental claims before promoting them.

Clearer regulatory standards will increase transparency for U.S. and EU companies regarding their decarbonization and carbon credit plans. Without these guidelines, companies may hesitate to use carbon removals to offset residual emissions due to concerns over potential anti-greenwashing lawsuits.

Growing Interest in Carbon Credits Education

Corporate buyers are showing increased interest in learning more about carbon removals. The recent survey of NASDAQ revealed that 80% of respondents want more education on the topic. Many companies are turning to external experts to help them make informed decisions about carbon credit purchases.

Carbon credit registries like Puro.earth set standardized protocols and track credits to ensure market credibility. For 62% of corporate buyers, these registries and standards play a key role in their purchasing decisions.

Subsequently, this is becoming important as they navigate the complexities of different carbon removal methods, such as terrestrial, technological, and ocean-based options. Additionally, corporate buyers are increasingly expecting carbon credits to offer long-term CO2 storage. This shows a clear shift towards prioritizing permanent solutions for carbon removal.

From CDR to carbon credits to carbon offsets, understanding all these factors is critical for building effective decarbonization strategies for the corporate sector. And NASDAQ’s report is a perfect guide to that.

Source: Data and Visuals collected from 2024 NASDAQ Global Net Zero Pulse.

FURTHER READING: Xpansiv and Puro.earth Partner to Scale Carbon Removal Credits Market

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