Brazil launches coal power program with 2050 end date
The Brazilian government launched a program to encourage the continued use of coal-fired power in the face of a drought-induced power shortage.
The ordinance launched today, which runs counter to most global efforts to penalize coal fired power and other higher carbon fuels, has three objectives: preserving the existing coal power industry — which is concentrated in Brazil's southern region and provides a capacity of 1,572MW; lessening the coal industry's environmental impact; and encouraging contracting of installed coal power capacity.
Coal has became less competitive than other fuels in recent years from an efficiency perspective — with only 32pc efficiency against natural gas' 60pc, for example — while its higher emissions made it less attractive. This led to it losing governmental financing and space in Brazil's power auctions.
The Brazilian coal mining industry has tried to keep the sector alive, as a subsidy being paid by all regulated power consumers is set to expire in 2027.
The proposal calls for unspecified financial incentives for Brazil's coal-fired thermal plants to be put under contract through auctions for the regulated power market. Currently, most of the country's energy is already contracted in this kind of auction, in which the government follows its energy policy to determine which kinds of plants should be considered. The last time a coal-powered thermal plant was hired in an auction was in 2014.
The program also proposes that the government should invest in the modernization of Brazil's coal-fired plants, making them more sustainable, while also making them more attractive during auctions. It also proposes government help in searching for new powerplant financing or retrofitting of existing ones, including using public funding.
The proposal also suggests auction contracts with due dates that extend until 2050, Brazil's current deadline for the decarbonization of its energy grid. The ordinance argues that this is a cheaper alternative to Brazil's risk of an electrical blackout, as coal is an "indigenousfuel, not dollar-denominated."
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Start-ups to help Total keep output stable in 2Q
Start-ups to help Total keep output stable in 2Q
London, 26 April (Argus) — TotalEnergies said it expects its oil and gas production to hold broadly steady in the second quarter as planned maintenance is partially offset by rising output from new projects in Brazil and Denmark. The company expects to average 2.4mn-2.45mn b/d of oil equivalent (boe/d) in April-June, compared with 2.46mn boe/d in the previous three months and 2.47mn boe/d in the second quarter of 2023. Production is being supported by the restart of gas output from the redeveloped Tyra hub in Denmark late last month and the start of the 180,000 b/d second development phase of the Mero oil field on the Libra block in Brazil's Santos Basin at the beginning of the year. TotalEnergies first-quarter output was flat compared with the previous three months but 2pc lower than a year earlier as a result of Canadian oil sands divestments. The company reported a robust set of first-quarter results today, broadly in line with analysts' expectations. Profit for the first three months of 2024 was $5.7bn, compared to $5.6bn in the same period last year. Adjusted profit — which takes into account inventory valuation effects and special items — came in at $5.1bn, down by 22pc on the year but slightly ahead of the consensus of analysts' estimates of $5bn. Adjusted operating profit from the firm's Exploration & Production business was down by 4pc year-on-year at $2.55bn, driven in part by lower natural gas prices. The Canadian oil sands asset sales weighed on the segment's production but this was partly compensated by start-ups. As well as Mero 2, the Akpo West oil project in Nigeria started production during the first quarter. TotalEnergies' Integrated LNG segment saw a 41pc year-on-year decline in its adjusted operating profit to $1.22bn in January-March. The company said this reflects lower LNG prices and sales. But while its LNG sales for the quarter fell by 3pc in year-on-year terms, its LNG production was greater by 6pc. TotalEnergies achieved an average $78.9/bl for its liquids sales in the first quarter, an improvement on $73.4/bl a year earlier. But the average price achieved for its gas sales was 43pc lower on the year at $5.11/mn Btu. In the downstream, the company's Refining & Chemicals segment's first-quarter adjusted operating profit was $962mn in January-March, down by 41pc on the year but 52pc higher than the preceding quarter. TotalEnergies attributes the quarter-on-quarter rise to higher refining margins and a rise in refinery throughput . For the second quarter, it expects refinery utilisation rates to be above 85pc, compared with 79pc in the first quarter, boosted by the restart of 219,000 b/d Donges refinery in France. Total's Integrated Power segment continued to improve, registering a quarter-on-quarter and year-on-year increased of 16pc and 65pc respectively in its adjusted operating profit to €611mn. Net power production increased 14pc year-on-year to 9.6 TWh, while the company's portfolio of installed power generation capacity grew 54pc to 19.5GW. Total's cash flow from operations, excluding working capital, was down by 15pc on a year earlier at $8.2bn in the first quarter. The company has decided to raise its dividend for 2024 by 7pc to €0.79/share and plans a $2bn programme of share buybacks for the second quarter. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
MDBs, parties must deliver on finance: Cop 29 president
MDBs, parties must deliver on finance: Cop 29 president
Edinburgh, 25 April (Argus) — Cop 29 president-designate Mukhtar Babayev pointed to insufficient action from multilateral development banks (MDBs) despite encouraging discussions, and urged all countries to play their part to deliver on climate finance negotiations this year. Climate finance discussions will be an important part of climate negotiations this year, having been "one of the most challenging climate diplomacy topics over the years", Babayev said today at the 15th Petersberg climate dialogue in Berlin — a forum for multilateral discussions. The meeting is a key milestone in climate discussions, paving the way for Cop 29 negotiations. The topic will be key as countries must decide on a new global finance goal to replace the $100bn/yr by 2020 pledge to developing countries made in 2009 and missed by developed countries. Babayev said he was working with a range of actors including MDBs, which have a "special role" as "multilateral public finance contributed the single largest part of the [$100bn/yr] target". Babayev said progress from the MDBs was essential, but while he "had many encouraging engagements during the World Bank and IMF spring meetings in Washington last week , we heard a great deal of concern and worry that we did not yet see adequate and sufficient action". "That must change," he said. He also warned that there is no single initiative able to unlock and increase climate finance flows to trillions of dollars, and instead pointed to "many interconnected elements" that countries will need to consider to set this new finance goal — the so-called NCQG. He added that the NCQG working group has already identified many options. "We know that [there are] strong and well-founded views on all sides," he said. "We are listening to all parties to understand their concerns and help them refine official landing zones based on a shared vision of success so we can deliver a fair and ambitious new goal," he added. "We need everyone to play their part so that we can build up unstoppable momentum where everyone is confident that their contribution is fairly matched by the contributions of others". Germany's foreign minister Annalena Baerbock said industrialised countries need to live up to their responsibilities. "Financial contributions from developed countries and multinational development banks will remain the basis of our efforts," she said, confirming that Germany has a €6bn climate goal for 2025. But she also said that "the world has changed" since the UN climate body the UNFCCC established a list of climate finance donors in 1992. The list has just 24 countries, plus the EU, as contributors. "In 1992, the two dozen countries that provided international climate finance made up 80pc of the world's economy. Now, that share is down to 50pc, and the share of all other countries has more than doubled," she said. She urged other countries in the G20, including China, "to join our effort". She pointed out that the donor base was broader for the loss and damage fund — to tackle the unavoidable and irreversible effects of climate change. Cop 28 host the UAE, which is not part of the 1992 list of donors, was the first contributor of the new fund created in Dubai last year. Babayev said that finance will not be the only important topic discussed at Cop 29 and that work must be done to get "the loss and damage fund up and running". Finalising the Article 6 negotiations will also be a key issue. "We cannot leave everything to market mechanisms," he said. By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US-led carbon initiative misses launch date
US-led carbon initiative misses launch date
Houston, 23 April (Argus) — The Energy Transition Accelerator (ETA), a global initiative to use voluntary carbon market revenue to speed the decarbonization of developing countries' power sectors, has missed its planned Earth Day launch but continues to prepare for doing business. At the Cop 28 climate conference in Dubai last year, the initiative's leaders said they hoped to formally launch the program on 22 April 2024 . That didn't happen, but the program's leaders last week announced that the US climate think tank Center for Climate and Energy Solutions will serve as the ETA's new secretariat and that former US special presidential envoy for climate John Kerry will serve as the honorary chair of an eight-member senior consultative group that will advise the ETA's design and operations. The ETA plans to spend 2024 "building" on a framework for crediting projects they released last year. ETA leaders said the initiative could ultimately generate tens of billions of dollars in finances through 2035. The ETA also said the Dominican Republic had formed a government working group to "guide its engagement" as a potential pilot country for investments and that the Philippines would formally participate as an "observer country" rather than as a direct participant immediately. The ETA is still engaging Chile and Nigeria as potential pilot countries too, the initiative told Argus . The ETA is being developed by the US State Department, the Rockefeller Foundation, and the Bezos Earth Fund and would be funded with money from the voluntary carbon market. The initiative's ultimate goal is to allow corporate and government offset buyers to help developing countries decarbonize their power sectors through large projects that accelerate the retirement of coal-fired power plants and build new renewable generation. As of now, the ETA's timeline for future changes and negotiations with countries and companies is unclear. The program's goals are ambitious, especially at a time when scrutiny of some voluntary carbon market projects from environmentalists has weighed on corporate offset demand. By Mia Westley Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan’s Higashidori No.1 reactor faces further delays
Japan’s Higashidori No.1 reactor faces further delays
Osaka, 23 April (Argus) — Japanese utility Tohoku Electric Power has confirmed a further delay in reinforcement works at its 1,100MW Higashidori No.1 nuclear reactor, with its completion date unknown. The postponement in restarting the Higashidori reactor in northern Aomori prefecture would encourage Tohoku to secure replacement thermal fuels — such as LNG and coal — for an extended period, although the company is planning to resume another reactor in September. Tohoku previously aimed to complete the reinforcement work at Higashidori in the April 2024-March 2025 fiscal year. But the company needs more time to clear all the procedures for the assessment of basic earthquake ground motions and tsunamis, and to prepare for the plant inspection. It is still unclear when the company will complete the safety measures. The Higashidori reactor is undergoing inspections by Japan's nuclear regulation authority (NRA), based on stricter safety rules following the 2011 Fukushima nuclear disaster. The reactor will need to pass the safety checks and secure approval from local governments before restarting. Tohoku has three commercial reactors, including two at Onagawa in Miyagi prefecture and the Higashidori No.1 reactor, of which it applied to restart two. The 825MW Onagawa No.2 reactor has already cleared the NRA's safety inspections and obtained permission from local authorities to restart. The company is now planning to restart the Onagawa No.2 reactor in September . The possible return of the Onagawa No.2 reactor will help Tohoku reduce consumption of thermal fuels. The company used 2.76mn t of LNG in April-December 2023, up by 12pc from a year earlier, in the absence of all its nuclear reactors. But its coal consumption fell by 12pc to 5.68mn t during the period. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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