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Ecuador cuts power as heavy rains hurt hydro

  • Market: Electricity, Oil products
  • 18/06/24

Ecuador restarted daily two-hour power outages this week across the country because of issues in the 1.5GW Coca-Codo Sinclaire, 156MW Agoyan and 230MW San Francisco hydroelectric plants.

Heavy rainfalls near Coca-Codo Sinclair have increased sediments in the Coca river that feeds the plant, forcing six of its eight turbines out of operation. The plant is the largest generator in the country and is in the provinces of Napo and Sucumbios, in the northeast of the country.

In addition, Agoyan's engine house flooded also because of the massive rainfalls and landslides in the central highlands of the country where the plant is located. And the San Francisco plant, downstream of Agoyan, stopped generating as well because it uses the same water supply as Agoyan.

Ecuador has lost about 1.5GW-1.9GW of power capacity in recent days because of these issues and 400MW of power capacity available for imports from its northern neighbor Colombia were not enough to prevent the need for rolling outages.

The energy ministry will update its plans for outages this week based on the status of the three hydroelectric plants.

Ecuador implemented 2–8-hour blackouts for 12 days from 16-30 April because of a lack of rain in the main hydroelectric plants after dry conditions also led to 35 days of blackouts from October-December 2023.


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Von der Leyen faces new Green Deal challenges


19/07/24
News
19/07/24

Von der Leyen faces new Green Deal challenges

The president promises a ‘clean industrial deal', but will need to make compromises over climate policy, writes Dafydd ab Iago Brussels, 19 July (Argus) — Ursula von der Leyen's re-election by the European Parliament as president of the European Commission on 18 July promises to see a doubling down on climate and energy policy, with her 2024-29 mandate stipulating greenhouse gas (GHG) emissions cuts of at least 90pc by 2040 compared with 1990. "I have not forgotten how [Russian president Vladimir] Putin blackmailed us by cutting us off from Russian fossil fuels. We invested massively in homegrown cheap renewables and this enabled us to break free from dirty Russian fossil fuels," von der Leyen says, promising to end the "era of dependency on Russian fossil fuels". She has not given an end date for this, nor specified if this includes a commitment to ending Russian LNG imports. Von der Leyen went on to detail political guidelines for 2024-29. She has pledged to propose a "clean industrial deal" in the first 100 days of her new mandate, albeit without giving concrete figures about how much investment this would channel to infrastructure and industry, particularly for energy-intensive sectors. The clean industrial deal will help bring down energy bills, she says. Von der Leyen told parliament that the commission would propose legislation, under the European Climate Law, establishing a 90pc emissions-reduction target for 2040. Her political guidelines also call for scaling up and prioritising investment in clean technologies, including grid infrastructure, storage capacity, transport for captured CO2, energy efficiency, power digitalisation and a hydrogen network. She plans to extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials, and notes the dangers of dependencies and fraying supply chains — from Putin's energy blackmail to China's monopoly on battery and chip raw materials. Majority report Passing the necessary legislation to implement her stated policies will now require approval from EU states and parliament. Unless amplified by Germany's election next year, election victories by far-right parties in France and elsewhere appear not to threaten EU state majorities for specific legislation. Parliament's political centre-left S&D and liberal Renew groups, as well as von der Leyen's own centre-right European People's Party (EPP), have elaborated key policy requests. These broadly call for the continuation of the European Green Deal — a set of legislation and policy measures aimed at 55pc GHG emissions reductions by 2030 compared with 1990. A symbolic issue for von der Leyen to decide on — or compromise on — is that of internal combustion engine (ICE) vehicles. EPP wants to stick to technological neutrality and revise the current mandate for sales of new ICE cars to be phased out by 2035, if they cannot run exclusively on carbon-neutral fuels. The EPP wants an e-fuel, biofuel and low-carbon fuel strategy. Von der Leyen's guidelines reflect the need to gain support from centre-right, centre-left and greens. She says the 2035 climate neutrality target for new cars creates investor and manufacturer "predictability" but requires a "technology-neutral approach, in which e-fuels have a role to play". She has not mentioned carbon-neutral biofuels. It will be impossible for von der Leyen to satisfy all demands in her second mandate. This includes policy requests put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen and market rules for carbon capture and storage, to postponing the EU's deforestation regulation. EU member states are expected to propose their candidates for commissioners in August, including for energy, climate and trade policy, with von der Leyen's new commission subject to a final vote in parliament in late October. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Trump vows to target 'green' spending, EV rules


19/07/24
News
19/07/24

Trump vows to target 'green' spending, EV rules

Washington, 19 July (Argus) — Former president Donald Trump promised to redirect US green energy spending to other projects, throw out electric vehicle (EV) rules and increase drilling, in a speech Thursday night formally accepting the Republican presidential nomination. Trump's acceptance speech, delivered at the Republican National Convention, offered the clearest hints yet at his potential plans for dismantling the Inflation Reduction Act and the 2021 bipartisan infrastructure law. Without explicitly naming the two laws, Trump said he would claw back unspent funds for the "Green New Scam," a shorthand he has used in the past to criticize spending on wind, solar, EVs, energy infrastructure and climate resilience. "All of the trillions of dollars that are sitting there not yet spent, we will redirect that money for important projects like roads, bridges, dams, and we will not allow it to be spent on the meaningless Green New Scam ideas," Trump said during the final night of the convention in Milwaukee, Wisconsin. Trump and his campaign have yet to clearly detail their plans for the two laws, which collectively provide hundreds of billions of dollars worth of federal tax credits and direct spending for renewable energy, EVs, clean hydrogen, carbon capture, sustainable aviation fuel, biofuels, nuclear and advanced manufacturing. Repealing those programs outright could be politically difficult because a majority of spending from the two laws have flowed to districts represented by Republican lawmakers. The speech was Trump's first public remarks since he was grazed by a bullet in an assassination attempt on 13 July. Trump used the shooting to call for the country to unite, but he repeatedly slipped back into the divisive rhetoric of his campaign and his grievances against President Joe Biden, who he claimed was the worst president in US history. Trump vowed to "end the electric vehicle mandate" on the first day of his administration, in an apparent reference to tailpipe rules that are expected to result in about 54pc of new cars and trucks sales being battery-only EVs by model year 2032. Trump also said that unless automakers put their manufacturing facilities in the US, he would put tariffs of 100-200pc on imported vehicles. To tackle inflation, Trump said he would bring down interest rates, which are controlled by the US Federal Reserve, an agency that historically acts independently from the White House. Trump also said he would bring down prices for energy through a policy of "drill, baby, drill" and cutting regulations. Trump also vowed to pursue tax cuts, tariffs and the "largest deportation in history," all of which independent economists say would add to inflation. The Republican convention unfolded as Biden, who is isolating after testing positive for Covid-19, faces a growing chorus of top Democratic lawmakers pressuring him to drop out of the presidential race. Democrats plan to select their presidential nominee during an early virtual roll-call vote or at the Democratic National Convention on 19-22 August. By Chris Knigh t Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Q&A: Aviation may pull feeds away from marine: BV


19/07/24
News
19/07/24

Q&A: Aviation may pull feeds away from marine: BV

London, 19 July (Argus) — Biofuel feedstocks could be routed away from marine fuels to meet demand from the aviation sector if the latter is willing to pay higher prices associated with sustainable aviation fuel (SAF), Bureau Veritas (BV) Marine & Offshore's global market leader for sustainable shipping Julien Boulland told Argus. Edited highlights follow: Marine biodiesel has been the largest alternative fuel uptake, with over 1mn t sold in Rotterdam and Singapore last year. But with Argus assessments showing premiums above $225/t to VLSFO dob ARA, how do you see marine biodiesel demand in the medium- to long-term? Shipowners and ship operators have to run an individual cost-analysis on whether the premiums could be offset by potential savings under EU emissions trading system (ETS) and FuelEU Maritime regulations, as well as any future regulations such as the International Maritime Organisation (IMO) economic pricing mechanism . In terms of emissions, biofuels still emit CO2 on a tank-to-wake basis, but less on a well-to-wake basis compared to their fossil equivalents. This will also vary depending on the feedstock for the biofuel as well as the production process. Under the current IMO regulations for energy efficiency, including the Ship Energy Management Plan (SEEMP) and its requirements for fuel reporting (DCS), there might be some indirect commercial benefits for owners, too. For example, a better CII (Carbon Intensity Indicator) score may make a vessel more appealing to charterers and help its owner secure more favourable rates. There are also other factors to consider, such as Scope 3 emissions rights, which can influence demand, as we currently see from voluntary demand from cargo owners seeking those documents. But this will also have a geographic impact on demand, as larger container liner companies usually utilise the east-west route and they might prefer to opt for bunkering the marine biodiesel blend in Singapore due to lower prices. What are the risks associated with bunkering marine biodiesel in relation to conventional ship engines? How significant is the recent FOBAS report that implied a correlation between the use of "unidentified" biofuels and engine pump injector damage? We have supported our shipowner clients in numerous pilots to trial biofuels such as fatty acid methyl ester (Fame) and hydrotreated vegetable oil (HVO) in variable blends. Overall, these trials have gone smoothly, but we have learned a few things along the way. Firstly, engines do not need to be modified, but since biofuels have slightly different physical properties, it is necessary to find the right engine adjustments. 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News

Weather sparks uncertainty for Vietnam’s bitumen demand


19/07/24
News
19/07/24

Weather sparks uncertainty for Vietnam’s bitumen demand

Mumbai, 19 July (Argus) — Expectations of Vietnam's bitumen consumption in July-August are mixed, given an easing in the monsoon season in some regions but an upcoming typhoon season in other parts. The mixed expectations will likely keep importers uncertain about future seaborne purchases. Consumption in Vietnam has been lower than normal in the last quarter because of unfavourable weather, political uncertainties, a lack of new paving projects and delays in disbursement of project funds, according to market participants. The lower consumption kept inventories higher and weighed on demand for spot seaborne volumes, with many importers only focused on taking delivery of their term contract shipments. Some importers in Vietnam are cautious and did not report consumption rising noticeably as weather in the key consuming south and central regions continues to be wet and not suitable for road paving, while the country is also set to experience typhoons next month. Consumption will stay low until September because the typhoon season starts next month, and the first region to get hit is the north before moving towards the south, a key importer told Argus . It is raining in the south and central regions, according to the importer. "The north is alright now but there is no good pick up [in consumption]," the importer said, adding that imported cargo inventories in the region are still notably higher. This is in contrast to expectations from other Vietnamese importers and some Asian traders, which said that consumption and demand for seaborne bitumen are expected to be higher in July and August as compared to previous months this year, given favourable weather in north Vietnam and more enquiries for Singapore cargoes, to restock in August. Consumption in the south and central regions are stable-to-weak, but overall demand in July and August are set to pick up as some new road projects are in the pipeline, a market participant said. Inventories are falling in some parts of the region and there is a need to replenish stocks now, while the domestic selling price is also expected to increase, participants said. "Demand in Haiphong and north Vietnam is good, and we are able to sell more than last month," another importer told Argus . "If the weather continues to be good, then demand will improve further in the coming weeks and that can increase import appetite." Vietnam is a net importer and typically secures most of its seaborne volumes from Singapore, Thailand, Taiwan, and China. Vietnam imported 1.04mn t of bitumen in 2023, up by 20pc from 866,000t imported in 2022, according to GTT data. Singapore cargoes accounted for about 32pc of Vietnam's total imports last year, while Thailand, Taiwan, and China together accounted for about 35pc of the total imports, the data showed. This compared to a 33pc and 40pc share, respectively, in 2022. Middle East penetration Some importers are worried that domestic prices are unlikely to rise in the near term, because of increased availability of relatively cheaper Middle East-origin cargoes in the region. They noted that this would cut domestic appetite for Asian cargoes and would in turn weigh on imports. Vietnam imported about 252,000t of bitumen from the Middle East in 2023, accounting for about 24pc of the total imports, show GTT data. This compared to 135,000t imported in 2022, which accounted for about 16pc of the total imports. Imports from the Middle East totalled 156,000t over January-May, nearly tripling from 55,000t imported during the same period last year. The region's imports from Singapore during the five-month period this year totalled 135,000t, down from 150,000t a year earlier. Imports from the Middle East increased as the inter-regional price arbitrage with Singapore was wide open. The Argus assessed ABX 1 fob Singapore prices averaged $421.50/t for the week of 12 July, while fob Iran bulk prices averaged $294.50/t for that week. Vietnam importers noted that Middle East-origin bulk cargoes were priced at low-$400s/t on a cfr basis, which was still lower than prevailing fob Singapore levels during the period. By Sathya Narayanan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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