Uncategorized – Page 74 – The Global Carbon Fund

Over $10 Trillion Funding Gap Looms for India’s Net Zero Goal

January 16, 2024/in Uncategorized /by

India is confronting a substantial “funding gap” of over $10 trillion to meet its commitment to achieving net zero emissions by 2070, according to Finance Minister Nirmala Sitharaman.

The minister stressed the importance of establishing a carbon credit market at Gujarat’s GIFT City’s International Financial Services Centre (IFSC). The goal is to address the financial challenges associated with transitioning to green technologies.

Gujarat International Finance Tec-City (GIFT City) is a central business district currently under construction in the Gandhinagar district of Gujarat, India. Positioned as the country’s first operational greenfield smart city and international financial services center, GIFT City is a significant greenfield project.

Sitharaman further emphasized GIFT City’s role as a gateway for India’s development, projecting a GDP exceeding $30 trillion by 2047. The IFSC, she stated, should evolve into a diverse fintech laboratory to support the country’s economic advancement.

The Gateway to India’s Net Zero Goal

Current regulations prevent Indian companies from directly listing overseas. Instead, they can access foreign equity markets through depository receipts like American Depository Receipts (ADRs) and Global Depository Receipts (GDRs) only after completing an initial public offering (IPO) in India.

Sitharaman announced that Indian companies would be able to access global capital by directly listing on exchanges at the IFSC. This will provide them a platform for raising funds for green initiatives.

Prime Minister Narendra Modi suggested creating a platform for trading green credits, facilitating the sale of carbon credits. These credits are usually from initiatives such as tree planting.

The PM specifically said that:

“According to certain estimates, India will need at least $10 trillion to achieve its net zero targets by 2070. This will need to be financed through global sources. Therefore, we must make IFSC a global hub for sustainable finance.”

Carbon markets play a crucial role in enabling businesses to trade carbon credits, aiding in achieving their emissions reduction targets. These markets allow carbon credits to be sold and bought by businesses and other entities. Voluntary carbon markets trade carbon credit offsets, which demand poised to grow rapidly.

Carbon credits are the underlying commodities that enable the buyer to retire a certain amount of greenhouse gas emissions and help them meet their targeted emissions cut. One carbon credit represents one tonne of carbon removal or reduction.

These carbon credit markets are gaining traction, as an increasing number of global firms are committing to net zero targets. These entities also play a pivotal role in curbing India’s emissions.

The super-emitter revealed its long-term strategy to achieve net zero by 2070 at COP27.

The Rise of Carbon Trading in India

The world’s third largest emitter has made ambitious NDC commitments. Some of them are definitive and measurable while some emission reduction plans still lack quantifiable aspects.

India’s updated NDC include two major climate goals:

Reduce emissions intensity of its GDP by 45% from 2005 levels by 2030, and
Achieve 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030.

The Paris Agreement recognizes the principle of common but differentiated responsibilities, considering nations’ capabilities and bandwidth for emissions reduction.

To address this, key data should be made public, including the GDP projection for 2030, growth drivers under different energy scenarios, and the methodology used. This information will allow the calculation of carbon intensity of GDP under various energy mix scenarios.

To bridge the gap between estimated emission intensity and NDC commitment numbers, sector-specific GHG emission targets can be established. Sectors such as steel, aluminum, cement, and thermal power, known for higher emissions, could have quantifiable targets based on global best practices, adapted to domestic capabilities.

The projected reduction in emissions, assuming these targets are met, should then be considered when estimating the total emission intensity reduction by 2030.

Earlier this month, Gujarat and its forest department, has signed various Memorandums of Understanding (MoUs) worth over $266 million of carbon credits from planting mangroves. Agreements have also been inked for carbon credits through agroforestry.

Unlocking Global Capital Via Carbon Credits

The Indian Government has taken a positive step by notifying the Carbon Credit Trading Scheme (CCTS) under the Energy Conservation Act, 2001. The CCTS outlines GHG emission intensity reduction targets for entities in specific sectors. It aims to establish a regulated domestic carbon credit trading market with transparent price discovery.

The Bureau of Energy Efficiency (BEE) is responsible for administering the scheme and setting targets for obligated entities, while the Central Electricity Regulatory Commission (CERC) regulates carbon credit trading.

Now, Indian businesses find themselves on the verge of a lucrative venture by entering the thriving global carbon trading markets.

As India grapples with its funding gap for net zero ambitions, the emergence of GIFT City and innovative financial strategies offer a glimmer of hope. From carbon credit agreements to direct listings, the nation is poised for a transformative journey towards a sustainable future.

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Charging Ahead: USA’s $623 Million Boost for EV Infrastructure & Ireland’s Lithium Quest

January 16, 2024/in Uncategorized /by

In a bid to reshape the transportation landscape, the United States government has committed a staggering $623 million to propel the growth of electric vehicles (EVs). Across the Atlantic, Ireland is stepping into the limelight with promising lithium discoveries, aiming to bolster Europe’s battery supply chain.

The dynamics of these groundbreaking developments will have a potential impact on the future of sustainable mobility.

Empowering EVs in the US

The Biden administration grants, available through the 2021 Bipartisan Infrastructure Law, are geared towards supporting the increasing deployment of EVs.

Currently, there are over 4 million electric vehicles on the American roads, as per the U.S. Transportation Department’s data. But progress on the EV charging network has been slow. Only New York and Ohio have charging stations in operation.

Meanwhile, Pennsylvania and Maine are expected to open EV charging stations early this 2024.

EV Unit Sales 2016-2028

Last year, a total of around 11 million EV units were sold globally, according to Statista. This year, the EV market, including both battery and plug-in hybrid, would reach a staggering $623 billion in sales worldwide. Such a massive growth will lead to a market volume of $906 billion by 2028, reaching 17 million vehicle units.

With the grant, the U.S. aims to make EV chargers more accessible, reliable, and convenient for American drivers. Plus, this will also generate jobs in charger manufacturing, installation, and maintenance.

Of the total amount, $311 million from the Federal Highway Administration will support 36 community projects, including EV charging and hydrogen fueling infrastructure.

The remaining $312 million will go to 11 recipients for projects along designated alternative fuel corridors. In total, the grants will fund 47 EV charging and alternative-fueling infrastructure projects across 22 states and Puerto Rico. Overall, this would lead to the construction of approximately 7,500 EV charging ports.

The recipients include the North Central Texas Council of Governments, the New Jersey Department of Environmental Protection, and the Maryland Clean Energy Center.

The funds are part of the $2.5 billion Charging and Fueling Infrastructure Discretionary Grant Program under the infrastructure law. The regulation has a broader goal of installing 500,000 EV charging stations in the U.S. by 2030.

Since January 2021, EV sales have quadrupled, and publicly available charging ports have increased by 70%, per the Transportation Department. That figure is only ⅓ of the way to the current administration’s goal, with 6 years left.

What all these bullish projections mean is more requirement for lithium and Europe is also ramping up its lithium exploration. As seen below, projected lithium requirements for EV needed by 2040 is nearly 25 million metric tonnes.

Ireland’s Lithium Odyssey

Back in 1972, Irish Base Metals Ltd. identified traces of lithium in local granites during base metals exploration. However, the potential significance was overlooked at the time, as lithium was deemed “not of interest” and “not really a commercial mineral,” according to John Teeling, a former key adviser to Irish Base Metals.

The EU, heavily dependent on Australia for 87% of its raw lithium imports, is now keen on expanding exploration. The bloc’s Critical Raw Materials Act is supporting this move. The EU-backed GreenPeg project has considered southeast Ireland as one of 3 locations to study pegmatite ore deposits.

Pegmatite lithium deposits is also known as hard-rock lithium deposits, containing extractable amounts of a number of elements, including lithium,

Ireland is historically significant as Russia’s 3rd-largest alumina supplier in 2022. It is also home to Europe’s largest zinc-producing mine. However, recent mineral exploration has primarily focused on other resources like copper, lead, zinc, and gold.

S&P Global Market Intelligence data indicates only 2 established lithium projects in the country, Avalonia (Carlow) and Leinster (Wicklow).

John Harrop, senior project geologist at Canadian consultancy Coast Mountain Geological Group, which works on the Avalonia project, highlighted that:

“If exploration is successful in Ireland, it is more likely to contribute a number of small- to medium-size lithium bodies similar to the clusters that are being explored and discovered elsewhere in Europe.”

Harrop envisions Ireland becoming a contributor to lithium supply feeds for upcoming lithium processing plants in Europe. He further emphasized the potential for more discoveries in the Irish lithium belt.

Arkle Resources, in a new lithium exploration effort, discovered pegmatites in its Mine River gold project in November 2022. This area is west of the Avalonia project, a joint venture established in 2014 by Canada’s International Lithium Corp. and China’s Ganfeng Lithium Group.

These developments come as Ireland faces challenges in building a lithium sector. These particularly include a shortage of skilled professionals experienced in recognizing hard rock lithium.

One of the companies best prepared to take advantage of the looming shortage of lithium is Li-FT Power (LIFT; LIFFF). It is the fastest developing North American lithium junior, with 5 different projects across Canada.

As the wheels of innovation turn, the convergence of substantial investments in EV infrastructure and Ireland’s lithium exploration signals a transformative era. The electrification of transport and the pursuit of sustainable energy solutions will shape the global landscape in unprecedented ways. The road ahead is charged with potential, both electric and lithium-powered.

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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2024 Would be a Strong Year for CCUS, Says Wood Mackenzie

January 16, 2024/in Uncategorized /by

In 2024, the Carbon Capture, Utilization, and Storage (CCUS) landscape is poised for significant developments, with key themes and trends shaping the industry. Wood Mackenzie had some predictions for the year as laid out in their report, expecting storage capacity to grow rapidly.

CCUS has long been a crucial energy transition topic, playing an important role in the global net zero 2050 scenario. The research company predicted that CCUS capacity will increase from 80 metric ton per annum (Mtpa) to over 500 Mtpa.

Here are the major takeaways from Wood Mackenzie 2024 CCUS outlook report.

Unprecedented Number of CCUS Project Final Investment Decisions (FIDs)

The global CCUS pipeline would grow, with 119 projects aiming for FID in 2024, representing the largest number to date. These projects collectively target 115 Mtpa capture capacity and 240 Mtpa storage capacity. The map below shows the CCUS project hotspots and each region’s risked capacity.

Those projects reaching FID status this year are primarily hubs in North America and Europe. As illustrated below, the increase in projects’ capacity estimated this year more than doubled compared to last year. Over 60% is in North America.

CO2 Storage Licensing Momentum

Licensing activity for CO2 storage will continue to support the increase in project capacity. New licensing rounds are anticipated in the US and the UK. Wood Mackenzie expects majors like Chevron, Equinor and TotalEnergies to bid in Texas.

Over in Denmark, the country opened applications for CCS licenses in 5 onshore areas in December last year. Australia also opened 10 new blocks for the 2023 GHG acreage release, where Santos, Woodside and INPEX are likely to increase current acreage.

Meanwhile, Southeast Asia may witness the formal opening of CO2 storage license areas in Malaysia and Indonesia. Petros is the sole company which received 2 CO2 storage licenses in Malaysia.

Moreover, regulatory changes are expected to expedite project timelines, leading to increased applications for CO2 storage wells and drilling.

Advancements in Direct Air Capture (DAC) and New Capture Technologies

In 2024, there will be a focus on achieving at-scale readiness for DAC. Direct air capture is one of the go-to capture technologies available today.

Below are the expected developments in DAC this year per Wood Mac outlook:

Stratos, the world’s first global-scale DAC plant with a capacity of 0.5 Mtpa, is expected to reach or near the end of construction.
Climeworks‘ Mammoth DAC project would start operations in the second half of 2024.
The US Department of Energy would announce additional DAC hubs and finalize funding amounts.
Startups may develop pilots featuring newer technologies, reaching technology readiness level 6.

Despite these advancements, challenges related to cost and execution risks remain. The research firm will continue to report how new DAC projects can help improve operational efficiency and reduce costs.

Introduction of New Capture Technologies and Industry Involvement

2024 would see project announcements, FIDs, and startups involving new capture technologies and industries. Notable projects, such as Svante’s Veloxotherm Technology, could play a game-changing role.

Projects for commission this year include carbon capture technologies developed by Aker Carbon Capture, LanzaTech, and Honeywell UOP. They’re located in Norway, South Africa, and the US, respectively.

Lastly, the report also covers the evolving regulatory framework, highlighting the development of regulations.

It further explores the potential impact of global elections in 2024 on CCUS policies, particularly the U.S. elections. The full report provides in-depth insights into these predictions and trends shaping the CCUS landscape.

In a separate analysis last year, Wood Mackenzie said that to reach global net zero goals by 2050, carbon capture has to hit 7 billion tonnes of CO2 a year.

With an anticipated surge in Final Investment Decisions (FIDs), growing CO2 storage licensing momentum, and advancements in Direct Air Capture (DAC) and new capture technologies, 2024 unfolds as a pivotal chapter in the journey towards global net zero by 2050. The industry is poised for unprecedented growth, innovation, and strategic partnerships, positioning CCUS as a key player in the energy transition landscape.

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New Fuel Powers Up India’s Green Nuclear Future

January 15, 2024/in Uncategorized /by

Revolutionizing the nuclear fuel landscape, a breakthrough innovation known as ANEEL (Advanced Nuclear Energy for Enriched Life) is gaining attention. Developed and patented by Mehul Shah, Founder and CEO of Clean Core Thorium Energy (CCTE), this fuel combines Thorium and High Assay Low Enriched Uranium (HALEU).

The United States Department of Energy (DOE), Idaho National Laboratory (INL), and the Nuclear Engineering & Science Center at Texas A&M worked with CCTE to develop ANEEL.

The Chicago-based company’s invention has the potential to reshape India’s green energy trajectory by facilitating the use of Thorium in nuclear reactors.

Thorium’s Role in Green Energy Solutions

India boasts the world’s largest thorium reserves, estimated at 1.07 million tonnes, sufficient for over a century. However, thorium, a fertile material, requires pairing with fissile materials like Uranium-235 or Plutonium-239 for reactor fuel.

Kailash Agarwal, Fuel Cycle Facilities Specialist at IAEA emphasized the importance of thorium in providing solutions to energy transition. He noted that:

“Because of its abundance and its fissile material breeding capability, thorium could potentially offer a long-term solution to humanity’s energy needs.”

Source: Lowery, Andrew et al, 2014.

The challenge lies in minimizing the use of precious uranium for this purpose. Clean Core’s ANEEL fuel addresses this issue by introducing a mix of Thorium and HALEU, enriching the Uranium content.

HALEU is a crucial material needed for many advanced reactor designs. A 20-kg HALEU was first produced by the Centrus Energy Corporation, the first of its kind in over 70 years.

The U.S. Department of Energy is investigating HALEU through its demonstration project in Piketon, Ohio in partnership with Centrus.

ANEEL can be integrated into existing Pressurized Heavy-Water Reactors (PHWRs), the backbone of India’s nuclear fleet. With 18 PHWR reactors already in operation and ten more under construction, ANEEL holds the potential to be a game-changer.

Unlike conventional reactors using uranium fuel enriched up to 5%, HALEU, enriched between 5% and 20%, is crucial for advanced nuclear reactor designs.

Currently, commercial HALEU production is limited. Only Russia and China are capable of producing HALEU at this scale. Given the risk at the demand side, suppliers aren’t all out in scaling up the production.

This is where Clean Core’s ANEEL innovation comes in. It offers a near-term path to commercialization, boosting confidence among suppliers.

Igniting India’s Nuclear Revolution

India’s thorium strategy involves creating a thorium blanket around uranium or plutonium reactors to convert thorium into uranium-233 as energy is produced.

ANEEL offers a more straightforward and quicker alternative, leveraging imported HALEU for thorium deployment. If adopted, ANEEL could accelerate India’s green energy transition, using its abundant thorium resources to achieve net zero by 2070.

Innovating the landscape of nuclear fuel, ANEEL not just offers an alternative for thorium but also brings about substantial benefits in terms of nuclear waste reduction and operational efficiency.

One of the major advantages of ANEEL is its ability to dramatically reduce nuclear waste volume and operating costs. The fuel bundle lasts much longer and burns more efficiently, with a burn-up of 60,000 MW-days per tonne. That’s much more efficient compared to the 7,000 MW-days per tonne of conventional natural uranium fuel in PHWRs.

This higher burn-up significantly impacts waste volumes and economic aspects of reactor operations.

When it comes to waste reduction, the comparison is also striking. Using natural uranium fuel in an existing 220 MW Indian PHWR, an average of 8 bundles would need daily replacement over the reactor’s 60-year lifespan. This totals about 175,000 bundles used.

Image from Clean Core

With ANEEL fuel, only 1 bundle would need daily replacement, resulting in 22,000 bundles used over the reactor’s lifetime. All these lead to significant waste reduction and cost savings.

Capturing the Global Nuclear Power Landscape

ANEEL’s unique composition of HALEU and Thorium provides inherent benefits, making the spent fuel unsuitable for weapons use. This gives reassurance to foreign uranium suppliers and reactor operators.

The technology has garnered international interest, with Canadian Nuclear Laboratories signing a Memorandum of Understanding (MoU) with Clean Core to support the development and deployment of ANEEL fuel.

This innovation could play a pivotal role in meeting the growing global demand for clean, baseload energy production. It strongly aligns with the goals outlined by countries at COP28 to triple nuclear capacity.

ANEEL fuel stands out in the nuclear power landscape with its proprietary combination of thorium and uranium, notably with HALEU. This distinctive fuel addresses multiple challenges associated with nuclear power, including cost, proliferation concerns, and waste management. Remarkably, being a product of American innovation, ANEEL fuel holds the potential for export to emerging nuclear markets.

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Uranium Prices at 16-Year Highs, Breaking $100 Per Pound

January 15, 2024/in Uncategorized /by

Spot uranium prices recently reached a peak not witnessed since 2007, standing strong at $101 per pound, per Numerico data.

This upswing signifies a constrained nuclear fuel market, growing expectations for future demand, and the imperative for additional mine restarts and new constructions, according to experts in the uranium industry.

Uranium is Powering Up the Future

The surge in uranium prices aligns with an increased focus on nuclear energy in global climate change mitigation efforts. Furthermore, rising uranium prices have spurred the revival of uranium mining operations previously scaled back following the 2011 Fukushima disaster.

Analysts and industry players anticipate more mine restarts in 2024. Plus, new builds are getting more attractive due to rising prices and anticipated supply deficits over the coming years.

The spot price of uranium surging $100/pound was more than a 100% increase from the 2023 low. It is also a whopping >300% rise from the 2020 low.

Uranium Spot Price USD Per Pound

Source: Numerico.com

The 16-year high uranium price, cracking at $101/pound since 2007, is driven by several factors.

For one, shortage in uranium supplies since the Fukushima incident drove prices upward.

Moreover, a U.S. bill seeking to ban nuclear fuel imports from Russia further contributes to the prices’ upward trajectory. The bill was called “NO RUSSIA” – National Opportunity to Restore Uranium Supply Services In America Act of 2022. Put simply, Russia will be out of the U.S. uranium market.

Once the bill passes the Senate, near-term demand for uranium will further surge upward.

What Causes the Unprecedented Rise of Uranium?

But what are the market experts saying about this price breakthrough?

According to a uranium market analyst, Marin Katusa, the 16-year high uranium price reflects the “real” cost of bringing on previously built and permitted facilities to replace uranium exported from Russia and Niger.

Marin also noted that with the US banning Russian imports, the logical investment is exposure to permitted, built out production in the US. The banned imports include Kazakh production owing to Russian enrichment.

Uranium prices have to increase more, Marin further noted, to incentivize new projects like the case with the Athabasca Basin. Building a new mine in North America would need even higher prices than $100.

Highlighting the growing demands for clean energy from data centers, which require more power for new technologies, SMR technologies offer a promising solution.

Small modular reactor development, with under 300 MWe capacity, is taking place in Western countries with increasing private investment. North America, in particular, would be the epicenter of this rapidly growing nuclear resurgence.

Marin also highlighted Japan’s decision to bring on the world’s largest nuclear power plant and its pro-nuclear stance since Fukushima. This and the positive outlook for nuclear technology globally coming out of the recent COP28 climate summit will create new demand for long term supply of uranium in politically stable jurisdictions. After all, Marin said that:

“…no nation wants to experience what France is experiencing in Niger with their uranium supply being completely cut off.”

For Miss America 2023, Grace Stanke, who happens to be a student of nuclear engineering, nuclear energy already plays a big role in the lives of many Americans. As a nuclear champion, Grace particularly noted that:

“From curing my dad’s cancer twice, to powering 20% of America, to helping with agriculture which is so important in my home state of Wisconsin… it really does feel like nuclear does it all.”

Beyond the Price: Uranium’s Ascent and Nuclear Energy Resurgence

As the world strives to reduce carbon emissions, zero-carbon nuclear energy is crucial. This is expected to make the demand for uranium explode much more.

In effect, escalating spot uranium prices may also exert upward pressure on contract prices as sellers seek higher returns. While higher prices may not dissuade utilities for short-term needs, climbing contract prices, covering larger quantities of uranium, could have a more substantial impact.

Some utilities are already experiencing “sticker shock”, as seen below in the S&P Global presentation. Experts also anticipate a widespread increase in nuclear fuel costs in the coming years due to rising market prices.

Notably, higher uranium prices would also drive further restarts in the near term, with industry giants like NAZ Kazatomprom JSC and Cameco restarting idle capacity. Canada-based Cameco will add capacity as needed under long-term contract pricing.

Meanwhile, Kazakhstan-based Kazatomprom, the largest uranium producer, plans to return to full production capacity by 2025. However, given the challenges that the company faces related to the availability of sulphuric acid (a critical operating material), they expect adjustments to their 2024 production plans. They also anticipate delays in finishing construction works at their newly developed deposits. These may affect Kazatomprom’s 2025 production plan, subject to considerable supply chain risks.

For other companies like GoldMining Inc (GLDG), this price increase is great news for their high-value assets. GLDG is one among the companies that’s making waves in the sector.

The surge in uranium prices signifies a resurgence in the nuclear energy sector. Driven by geopolitical shifts, legislative actions, and a growing demand for clean energy, the uranium market is poised for unprecedented growth.

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

Carboncredits.com receives compensation for this publication and has a business relationship with any company whose stock(s) is/are mentioned in this article

Please read our Full RISKS and DISCLOSURE here.

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EU Approves Almost $1B State Aid for Northvolt’s German Gigafactory

January 12, 2024/in Uncategorized /by

The European Commission has granted approval for Germany to provide €902 million ($987mn) in state aid to Swedish battery manufacturer Northvolt AB. This approval marks the inaugural application of a new rule allowing European Union nations to match foreign subsidies to prevent investments from diverting outside the bloc.

Battery startups are drawing in record-breaking investments, reflecting the growing potential of the sector. Last year’s global venture funding is about to exceed the records set in the last 2 years.

Northvolt is Electrifying Europe

2023 marked by a global drop in venture investments, but the figures in the battery sector are defying the trend. This underscores the urgency highlighted by recent climate change projections, emphasizing the critical role of advanced battery technology and sustainable production in addressing environmental challenges.

Northvolt’s plan involves constructing an electric vehicle battery production plant in Heide, Germany, with an annual capacity of 60 GWh. The state aid approval ensures the project moves forward in Germany instead of the US. The battery-maker had considered establishing a lithium-ion facility in Canada under the Inflation Reduction Act (IRA).

The state aid initiative, known as the Temporary Crisis and Transition Framework, is part of an effort to fortify European manufacturing in strategic sectors, such as batteries, wind turbines, and solar panels, amid intense global competition. It allows national governments to match subsidies if there’s a risk that a project is likely to be taken elsewhere.

Margrethe Vestager, the EU’s competition commissioner, highlighted the importance of enabling states to match aid to secure investments within Europe.

Likewise, German Economy Minister Robert Habeck clarified that the German state aid doesn’t entirely match the subsidies offered by the IRA. Still, it is sufficient to encourage Northvolt to pursue the new plant in Germany.

The aid comes in the form of a €700 million grant and a €202 million guarantee.

Habeck rejected the notion that the matching aid mechanism primarily benefits wealthier EU nations only. He further emphasized the importance of European solidarity and acknowledged the escalating global competition, particularly from China and the US. He specifically noted that:

“We need a more robust industry for the new sectors — semiconductors, batteries, electrolysers, hydrogen. But this means that climate action and industrial production fit very, very well together.”

The EC has also approved a €2.9 billion French scheme supporting the production of devices needed for the transition. These include batteries, solar panels, wind turbines and heat pumps.

EU’s Strategic Move in Battery Tech

The demand for battery power would grow to 2,035GWh by 2030 from 185GWh in 2020 , a whopping 11x increase. About 90% of that comes from transportation alone.

In terms of size, the global battery market was estimated at over $107 billion in 2022 and can potentially hit around $475 billion by 2032, according to a market research.

Northvolt’s plans for the Heide plant include the production of 800,000 to 1 million EV batteries annually starting in 2026. The battery manufacturer also aims for full production capacity achieved by 2029.

The Stockholm-based manufacturer is the first European company to produce a battery cell from a gigafactory. This term is used to refer to large-scale manufacturing facilities dedicated to electrification.

In a 2023 industry report, three remarkable financings exceeded $1 billion and Northvolt is one of them. The company secured $1.2 billion from investors in 2023 to support its expansion in Europe and North America.

The battery titan has a factory in Northern Sweden, the largest factory in the country’s history. This plant can generate 60GWh of batteries a year when operating at full capacity. The company also has a facility in Poland.

Anders Thor, Northvolt’s vice president of communications and public affairs, hailed the European Commission’s positive decision.

He highlighted its significance not only for Northvolt’s planned battery production but also for the broader European battery industry. He anticipates final voting procedures from local communities.

As Northvolt gets the green light in state aid from Germany, the battery giant is set to revolutionize the energy landscape. The approval underscores the EU’s commitment to fostering strategic sectors, driving sustainable production, and combating global competition. Amidst heightened climate concerns, this landmark decision propels Europe toward a resilient and competitive future in advanced battery technology.

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Xpansiv Bolsters Renewable Energy with Evident Partnership

January 11, 2024/in Uncategorized /by

Xpansiv, a global energy transition market infrastructure provider, has entered into an agreement with Evident Group Limited (Evident), a prominent clean economy registry provider and certification body. The deal gives Xpansiv a minority interest in Evident.

Evident is globally acknowledged as an authority in certifying the clean economy, renowned for its expertise, stringent standards, cutting-edge registry technology, and collaborative approach.

Serving consumers in 140+ countries, Evident has played a leading role in shaping sustainability certification for more than two decades. Notably, the company has pioneered the I-REC electricity certification service and market, extending its reach from China to Chile.

Ed Everson, CEO of Evident, remarked on their agreement, saying that:

“We believe expanding our partnership with Xpansiv will enable the market to scale more rapidly and will support our strategy to pioneer new products and services as well as invest in supporting and developing our wider network of partners and innovators around the world.”

Scaling Clean Energy Markets: Xpansiv and Evident’s REC Revolution

The investment solidifies the existing partnership between Xpansiv and Evident. This strongly aligns with their shared objective of facilitating the energy transition and certifying the world’s clean economy through independent certification and dynamic markets.

In collaboration with the I-REC Standard Foundation, Xpansiv previously launched the trading of International Renewable Energy Certificates (I-RECs) on its CBL spot exchange in conjunction with Evident.

The partnership expands the range of RECs and carbon credits trading on the CBL platform. This will improve RECs’ price discovery and liquidity formation.

The I-REC launch on Xpansiv’s market ecosystem also widens options for developers and traders in various regions. These particularly include Latin America, Asia, Africa, and the Middle East. The spot exchange is trading 100 voluntary and compliance RECs.

In 2021, CBL REC volumes increased by 28% because of broader market participation and rapid growth in solar REC traded. And with the projected growing demand for renewable energy, there’s also rising interests in trading of RECs worldwide.

According to estimates, the global REC market value will grow to more than $111 billion.

Xpansiv’s investment facilitated trading of I-RECs issued under the Evident Code for I-REC, spanning 50+ countries and various project types. Since the launch, over 120,000 I-RECs from projects in 10 countries have traded on CBL.

I-RECs Powering Global Clean Economy Goals

Xpansiv’s investment will support Evident’s expansion into new regions and products. These specifically include Sustainable Aviation Fuel (SAF), green hydrogen, biomethane, and carbon removals.

The I-REC market has experienced substantial growth, with nearly 300 million certificates issued on the Evident registry in 2023. That’s a massive increase from 198 million in 2022 and 71 million in 2021.

Redemption figures have also surged, reaching 176.5 million certificates in the previous year. That amount is almost double the 2022 total of 97 million and nearly quadruple the volume in 2021.

I-RECs serve as a direct market mechanism for multinational corporations, their supply chain collaborators, and general energy consumers. The certificates enable them to fulfill global renewable energy and sustainability goals.

I-RECs offer transparent, independent evidence certifying the production of renewable electricity, enabling consumers to actively support the transition to cleaner energy sources, even in the absence of a dedicated supply of renewable energy.

John Melby, CEO of Xpansiv, noted that their clients are increasingly integrating I-RECs and carbon removals into their sustainability initiatives. Thus, their recent deal with Evident is “a natural next step”.

Presently, Xpansiv’s infrastructure supports 12 carbon and renewable energy registries, responsible for issuing over 60% of North American RECs and 85% of global carbon credits in 2022. I-RECs trade alongside numerous voluntary and compliance products on Xpansiv’s CBL market platform.

The alliance between Xpansiv and Evident marks a significant step in fortifying the certification landscape for the clean economy, particularly renewable energy. With a shared vision of driving the energy transition, their partnership fuels the trade of Renewable Energy Certificates globally, bolstering the adoption of cleaner energy sources. This collaboration opens doors for diverse sustainable products and reinforces a commitment to shaping a greener future.

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Thai-Swiss Deal Sets Paris Agreement Carbon Offsets in Action

January 11, 2024/in Uncategorized /by

A Thai electric bus operator announced the sale of the initial carbon offsets under a new system established by the Paris Agreement to a Swiss fossil fuel group. Their deal marks a significant milestone in the implementation of the 8-year-old United Nations climate accord.

The Paris Agreement, formulated in 2015, permits governments and corporations to offset a portion of their greenhouse gas emissions by funding initiatives that mitigate climate pollutants elsewhere.

These offsets are converted into carbon credits, each representing the reduction of one metric ton of carbon dioxide (CO2) emissions.

Unlocking Carbon Offsets with Thailand’s Electric Bus

In December, Switzerland’s KliK Foundation, representing fuel importers, finalized the inaugural purchase of 1,916 carbon credits from Thailand’s Energy Absolute. This groundbreaking transaction demonstrates the potential of a nascent market for carbon credits.

Switzerland stands out as an avid supporter of bilateral credit trading as stipulated in article 6 of the Paris Agreement. The recent transaction is part of a broader pact inked between Switzerland and Thailand in the first months of 2023.

Although the credits obtained will eventually be used in government strategies, private entities are responsible for executing the project. South Pole, a prominent Swiss firm recognized as one of the global leaders in trading carbon credits, coordinated the project. The seller has encountered controversy in the past year, stirring discussions and debate within the industry.

Energy Absolute is responsible for generating the credits by deploying a fleet of 4,000 electric buses in Bangkok. The electric units replace the conventional petrol-fueled vehicles, avoiding the release of CO2 which produces the offsets.

Image from Nation Thailand

Though the exact value of the credits sold wasn’t disclosed, the Thai firm said that the credit price exceeded $30. Their partnership is shaping the Paris Agreement market, pending finalization of the UN rules at COP28 in Dubai last year.

The evolving nature of these regulations means that both Energy Absolute and KliK, along with regulators in their respective countries, can influence this burgeoning market. However, it also presents the risk of needing to revise their agreement once the final UN rules are out.

Switzerland’s Emission Trading Strategy

KliK’s managing director, Marco Berg, emphasized the complexities involved in being pioneers in this area, citing substantial effort and costs.

The Swiss government mandated fuel importers to offset a progressively increasing percentage of their emissions. They can do that either domestically or through Paris Agreement-compliant credits, leading KliK to engage in this transaction.

KliK has committed to purchasing offsets for up to 1.5 million metric tons of carbon dioxide emissions until 2030 from Energy Absolute. That’s only a fraction of the 20 million credits it expects to purchase by the decade’s close.

In comparison, Switzerland aims to offset roughly 40 million Mt of CO2 abroad through 2030 to fulfill its climate objectives.

Despite their utility, some environmental advocates criticize carbon offsets, contending that they promote pollution instead of focusing on its eradication.

They doubted the integrity of the credits, claiming they’re not additional, meaning the project would still pursue without the offsets.

But an independent carbon market consultant, Mischa Classen, disputed the claim. Classen noted that Thailand lacks a specific policy directive that supports private bus operators in transitioning to electric vehicles.

Moreover, a spokesperson representing the Klik Foundation said that the additionality issue is purely speculation. They further noted that Energy Absolute relies on the financial backing provided through the purchase of credits to ensure the project’s viability.

Additionally, a spokesperson from the Swiss Federal Office of the Environment (FOEN) emphasized that only offsets leading to additional emissions reductions would receive approval. They highlighted that thorough verifications are conducted in collaboration with the environmental authority of the host country.

Overcoming Paris Agreement Roadblocks

Despite ongoing uncertainties regarding the regulatory framework governing this mechanism, Switzerland persists in advancing these agreements.

Discussions about article 6.2 of the Paris Agreement faced a deadlock during COP28 due to a contentious disagreement over carbon offset integrity. The European Union advocated for stringent regulations, while the USA pushed for greater flexibility.

Although negotiators aim to broker an agreement during COP29 in November, countries have the liberty to proceed with their agreements under the initial rulebook formulated in Glasgow.

Classen underscores that Switzerland’s inaugural transaction contributes positively to the growing consensus among nations with genuine interest in Article 6. He added:

“It is the final result of a long, hard process and it is not a decision you can just switch on or off. You need well-designed bilateral agreements setting minimum standards and a lot of political labor to establish carbon market regulations. The case of Thailand shows that it’s possible.”

Anticipating a substantial portion of its emission reductions by 2030 to be achieved through overseas projects, the Swiss government continues its efforts in this direction.

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PSEG to Invest $21B for Net Zero Targets

January 10, 2024/in Uncategorized /by

Public Service Enterprise Group (PSEG) Inc. has raised its 5-year regulated capital spending plan to potentially reach $21 billion as it focuses on investing in solar, energy efficiency, and grid projects. These investments aim to ensure reliability while striving to achieve the corporation’s net zero goals.

PSEG’s Trailblazing Net Zero Commitment

PSEG’s vision for climate action sets an ambitious net zero goal by 2030. This positions the company as a trailblazer among major utility and power generator firms. This goal comprises three core pillars:

Net Zero Emissions for PSEG Operations: This encompasses the company’s utility arm, Public Service Electric & Gas, PSE&G’s utility operations (scopes 1 and 2), aiming to achieve net zero greenhouse gas (GHG) emissions by 2030.
100% GHG, Carbon-Free Power Generation: PSEG commits to transitioning its power generation to be entirely GHG and carbon-free.
Contributions to Regional Economy-Wide Decarbonization: PSEG aims to make substantial contributions to broader decarbonization efforts within the regional economy.

PSE&G has already made significant strides in reducing GHG emissions by over 50% from 2005 levels. The group now aims to achieve net zero GHG emissions (scopes 1 and 2) by 2030.

This aim focuses not just on reducing emissions from operations but also addressing GHG emissions associated with natural gas use. It serves about 2 million customers across New Jersey for various crucial needs like space and water heating.

As seen above, the group plans to use carbon offsets to address their 2030 GHG emissions. Carbon offsets are from projects that reduce or remove carbon somewhere else. Each offset equals a tonne of carbon emissions.

New Jersey’s Accelerated Decarbonization Initiatives

In an investor update, PSEG detailed its regulated spending plans for 2024-2028, primarily tied to its utility subsidiary, PSE&G. The company highlighted that these investments are driven by the need for system modernization and align with New Jersey’s decarbonization and energy policy objectives.

In February 2023, New Jersey Governor Phil Murphy announced the state’s ambition to achieve 100% clean electricity by 2035. This goal is accelerated from the initial target of 2050. The state also aimed to electrify 10% of commercial and residential buildings by the end of 2030.

Gov. Murphy further highlighted that:

“These bold targets and carefully crafted initiatives signal our unequivocal commitment to swift and concrete climate action today.”

The current Energy Master Plan (EMP) aimed at achieving the 100% benchmark by 2050, including a goal of 7,500 MW of offshore wind generation by 2035. By July 2022, the state had already exceeded its target of 3.75 GW of new solar generation by 2026. This secures 4 GW of solar power.

The state projects significant savings of $355 million annually and a reduction of 5.5 million metric tons of GHG emissions per year by 2030 through these endeavors and leveraging federal benefits provided by the Inflation Reduction Act.

Additionally, Executive Order No. 317 mandates the New Jersey Board of Public Utilities (BPU) to devise plans for the future of gas utilities in the state. This will align their emissions with the goal of reducing statewide GHG emissions by 50% below 2006 levels by 2030.

Moreover, New Jersey announced initiatives to support the transition to electric vehicles (EVs). The state adopts the Advanced Clean Cars II program and allocates $70 million from its Regional Greenhouse Gas Initiative funds to establish an incentive program for consumers switching to zero-emission vehicles.

As per their 2023 Sustainability Report, PSE&G has installed over 8,000 chargers through their EV Charging Program. The company has invested over $22 million in developing a smart charging infrastructure.

PSEG’s Expanded Clean Energy Capital Plan

Considering these goals and the increased demand for clean energy, electric reliability, and electrification, PSEG’s regulated capital plan saw a rise of over $2 billion, expanding from the earlier $16 billion to $18.5 billion plan for 2023-2027.

The updated plan encompasses a transmission project awarded to PSEG in December 2023 as part of PJM Interconnection’s grid upgrades. The goal is to accommodate data center growth and facilitate power plant retirements.

With that, PSEG’s total capital plan for 2024-2028 now ranges from $19 billion to $22.5 billion. This includes its power supply subsidiary PSEG Power LLC and other investments. The company affirmed that no new equity is needed to support this capital plan.

Moreover, PSEG sustained its 5% to 7% long-term annual earnings growth rate for 2024-2028, coming from its 2024 earnings guidance.

The projected 5-year EPS growth is underpinned by rate base expansion at PSE&G and the production tax credit for its unregulated nuclear fleet. The Inflation Reduction Act’s nuclear production tax credit offers up to $15/MWh for electricity generated by nuclear plants in service in 2024. PSEG Power holds interests in three nuclear plants in the PJM market.

Overall, PSEG’s $21 billion investment for net zero 2030 climate vision stands as a significant and comprehensive step forward in the energy industry. It shows its commitment to combating climate change and fostering a greener and more sustainable industry.

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