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CPC to import Taiwan's first SAF for 2025 trial

  • Market: Biofuels, Emissions
  • 24/06/24

Taiwan will supply its airlines with sustainable aviation fuel (SAF) for the first time in first-half 2025, as part of a pilot project to hasten carbon emissions reductions in aviation and meet its net zero goals.

There are plans for state-owned refiner CPC to import and supply SAF to national airlines at Taoyuan International Airport and Taipei Songshan Airport during January-June 2025. The volumes and airlines have not been confirmed, said a company source.

Taiwan's Civil Aviation Administration (CAA) also encourages Taiwanese airlines to target 5pc SAF use by 2030, given the International Civil Aviation Organisation's (ICAO) aim of achieving a 5pc cut in carbon dioxide emissions in international aviation by 2030 compared with a business as usual scenario.

The CAA said it has been working with the relevant ministries, oil companies, airlines and airports to understand their needs regarding domestic supplies of SAF. It is also in the process of ensuring facility certification and implementing supporting measures in airlines and aircraft.

The SAF used in trials next year must have been certified by an ICAO-authorised agency, including details such as oil pipelines, its import sources, oil storage tanks, vessels and tanker trucks transporting the oil. CPC is now settling certification work for each step of the import process. The SAF will also be certified by the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), a global scheme to reduce international aviation emissions, which airlines can directly use it to reduce their carbon emissions.

The CAA has strategies to decarbonise Taiwan's aviation sector. These are reducing fuel consumption through measures like optimising flight routes and encouraging airlines to replace old aircraft with new models. It also aims to step up energy conservation and carbon emissions reductions in airport operations and management, encourage airlines to use SAF and promote compliance with Corsia's emissions requirements.

The CAA updated Taiwan's civil and general aviation regulations last year to include laws on carbon emissions reporting in compliance with Corsia. Taiwan's airlines this year reported their carbon emissions for the first time for the year 2023, which the administration is also currently reviewing.


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19/07/24

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

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. A very good knowledge of the fuel properties is key in determining the right adjustments, and the new revision of ISO 8217 on marine fuel specifications is crucial in supporting this process. Another key finding is the importance of receiving full information on fuel characteristics from the supplier. Finally, BV plays a key role in ensuring full fuel certification on several aspects, including sustainability and physical properties. Used cooking oil (UCO) can also feed into SAF and with potentially greater refining margins. Do you think some feedstocks will be pulled away from marine? When it comes to methanol, we believed marine would take up more of the feedstock compared with the chemicals industry due to greater willingness to pay larger premiums. But with biofuels, it seems to be the other way around where aviation could end up pulling biofuel feedstocks away from maritime. In terms of fuel consumption, the marine and aviation industries are comparable but if aviation are willing to pay more, then it will likely get more of the feedstocks required to produce SAF. What are the implications of the new ISO specifications, what are the key takeaways for marine biodiesel uptake? More has to be done, but now we have parameters for assessing biofuel blend specifications. It was very well accepted by the industry, and now operators and shipowners have a standard to rely on. But it doesn't resolve the question around feedstock cross-industry competition. However, it does also open the door for off-spec Fame residue blends to become ISO-certified — depending on further testing. With IMO aiming for "global regulations for a global market", how do you see conflicts between different regulations affecting the market? We are closely following the IMO development process for a global economic pricing mechanism. IMO has assigned a working group of technical experts to look at this mechanism from an apolitical perspective. In terms of potential regulatory conflicts , we have the example of the Netherlands, where the Dutch emission authority requires the delivery of Proof of Sustainability (PoS) certificates for applying to the scheme of Dutch renewable tickets (HBE-G) which can be traded, but this PoS cannot be used for other purposes, such as the EU ETS. To circumvent this hiccup, we may see the development of new digital certificates, such as an accompanying ISCC-certified Proof of Compliance (PoC). By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Urgent action needed for UK to hit net zero goals: CCC


18/07/24
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18/07/24

Urgent action needed for UK to hit net zero goals: CCC

London, 18 July (Argus) — The UK increased the rate at which it reduced greenhouse gas (GHG) emissions last year, but "urgent action" is needed for the country to meet its targets in 2030 and beyond, independent advisory body Climate Change Committee (CCC) said in its progress report published today. The report assesses the UK's progress towards its net zero goals against policy set out by the previous Conservative government. The new Labour government, which has been in power since 5 July, has already set the scene for a stronger decarbonisation agenda , but it "will have to act fast to hit the country's commitments", the report says. The committee tracked progress on 28 key indicators. Of the 22 that have a benchmark or target, only five are assessed as being "on track". The UK's GHG emissions last year stood at 393mn t/CO2 equivalent (CO2e), down on the year by 5.4pc, or 22mn t/CO2e, provisional data show. This estimate excludes contributions from international aviation and shipping, as these are not included in the UK's 2030 target of a 68pc cut in GHG emissions from a 1990 baseline. And last year's reduced emissions resulted primarily from a drop in gas demand, the CCC says. Combined gas demand in 2023 averaged 156mn m³/d, down from nearly 175mn m³/d a year earlier. While progress has been made, the previous administration "signalled a slowing of pace and reversed or delayed key policies", the report says. The reduction in emissions last year is "roughly in line with the annual pace of change needed" to reach the 2030 target, but the average annual rate over the previous seven years is "insufficient", the committee says. The new government has placed strong focus on decarbonising electricity in its first days in office, but this is "not enough on its own", CCC acting chief executive James Richardson said. The average annual rate of GHG reduction outside the electricity supply sector over the previous seven years was 6.3mn t/CO2e, but this will need to more than double until 2030 if the UK is to meet its targets, the CCC says. In order to reach targets, "annual offshore wind installations must increase by at least three times, onshore wind installations will need to double and solar installations must increase by five times" by 2030. By comparison, oil and gas use should be "rapidly" reduced and the expansion of the production of fossil fuels should be limited, according to the report. The CCC also recommended that about 10pc of UK homes will need to be heated by a heat pump by 2030, in comparison with about 1pc today. The committee criticised the exemption of 20pc of properties from the 2035 phase-out gas boiler plan, saying it is "unclear" how the exemption would reduce costs as fewer consumers would have to pay to maintain the distribution grid. Gas-fired power generation in recent months has dropped on the back of high wind output and brisk power imports. Power-sector gas burn was 25mn m³/d in March-June, roughly half of the three-year average for the period. But if UK power demand increases with electrification, gas-fired power generation could maintain its role in the country's power mix, particularly if it is combined with carbon capture, use and storage technology, for which fast development and scale-up will need to happen this decade, the CCC says. "Biases" towards the use of natural gas or hydrogen must be removed where electrification is the most economical decarbonisation solution in an industry sector. Power prices need to be reduced "to a level that incentivises industrial electrification". Oil, gas industry to meet climate goals The UK's oil and gas sector "is on track to meet its own climate goals and is not slowing down", offshore industries association OEUK said today in reaction to the CCC's report. The UK needs a plan for reducing oil and gas demand and cutting its reliance on imports, according to OEUK chief executive David Whitehouse. "We should be prioritising our homegrown energy production," he said. The sector reduced its emissions by 24pc in 2022 from 2018, meaning it met its target to reduce emissions by 10pc by 2025 early. The industry halved its flaring and venting and cut methane emissions by 45pc in 2022 compared with 2018, Whitehouse said. OEUK plans to reduce emissions by a quarter by 2027 and by half by 2030 against 2018 levels. And it aims to achieve net zero by 2050. By Georgia Gratton and Jana Cervinkova Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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EU’s von der Leyen re-elected as Commission president


18/07/24
News
18/07/24

EU’s von der Leyen re-elected as Commission president

Brussels, 18 July (Argus) — The European Parliament today approved Ursula von der Leyen's re-election as president of the European Commission. Nominated by EU states in June, von der Leyen received 401 votes, by secret ballot, from parliament's 720 newly elected members. Von der Leyen called for continuing climate and energy policy in her 2024-29 mandate to achieve greenhouse gas (GHG) cuts of at least 90pc by 2040 from 1990 levels. "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," said von der Leyen, promising to end the "era of dependency on Russian fossil fuels". She did not give an end date for this, nor did she specify if this includes a commitment to end Russian LNG imports. Von der Leyen went on to detail political guidelines for 2024-29. In the first 100 days of her new mandate, she pledged to propose a "clean industrial deal", 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 said. Von der Leyen told parliament the commission would propose legislation, under the European Climate Law, establishing a 90pc emission-reduction target for 2040. Her political guidelines also call for scaling up and prioritising clean-tech investment, including in grid infrastructure, storage capacity, transport infrastructure for captured CO2, energy efficiency, power digitalization, and deployment of a hydrogen network. She will also extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials. Her political guidelines note the dangers of dependencies or fraying supply chains, from Putin's "energy blackmail" or 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 from 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 EPP, have elaborated key policy requests . These broadly call for the continuation of von der Leyen's Green Deal, the set of legislation and policy measures aimed at 55pc GHG emission reduction by 2030, compared with 1990 levels. A symbolic issue for von der Leyen to decide, or compromise on, is the internal combustion engine (ICE). Her EPP group wants to stick to technological neutrality and to revise the phase-out, by 2035, of new ICE cars if they cannot run exclusively on carbon-neutral fuels. The EPP wants an EU 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. For the ICE phase-out, she said 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 made no mention of carbon-neutral biofuels. It will be impossible for von der Leyen to satisfy all demands in her second mandate. That includes policy asks put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen, market rules for carbon capture and storage, postponing the EU's deforestation regulation, to catering more for farmers, even by scrapping EU wildlife protection for wolves and bears. EU member states are expected to propose their candidates for commissioners in August, including those responsible for energy, climate, and trade policies. When parliament has held hearings for candidates in late October, von der Leyen's new commission would then be subject to a final vote. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Urgent action needed for UK to hit net zero goals: CCC


17/07/24
News
17/07/24

Urgent action needed for UK to hit net zero goals: CCC

London, 17 July (Argus) — The UK increased the rate of reduction in its greenhouse gas (GHG) emissions in 2023, but "urgent action" is needed if the country is to hit its targets in 2030 and beyond, the independent advisory Climate Change Committee (CCC) found today. The report assessed the UK's progress towards its net zero goals against policy set out by the previous Conservative government. The new Labour government, which has been in power since 5 July, has already set the scene for a stronger decarbonisation agenda . But it "will have to act fast to hit the country's commitments", the CCC said. The committee tracked progress on 28 key indicators. Of the 22 that have a benchmark or target, just five are assessed as "on track". The UK's GHG emissions stood at 393mn t/CO2 equivalent (CO2e) in 2023, down by 5.4pc, or 22mn t/CO2e, on the year, provisional data show. This estimate excludes contributions from international aviation and shipping, as these are not included in the UK's 2030 target of a 68pc cut in GHG emissions, from a 1990 baseline. The UK's GHG emissions including the country's share of international aviation and shipping were 423.3mn t/CO2e in 2023, preliminary data show, 49.5pc lower than in 1990. The drop in GHGs has largely been driven by the decrease in coal-fired power generation over that time span. Although progress has been made, the previous administration "signalled a slowing of pace and reversed or delayed key policies", the CCC noted. The reduction in GHG emissions in 2023 is "roughly in line with the annual pace of change needed" to hit the 2030 target, but the average annual rate over the previous seven years is "insufficient", the committee added. The UK's 2030 emissions reduction goal is the first in line with reaching net zero by 2050. The new government has placed strong focus on decarbonising electricity in its first days in office, but this is "not enough on its own", CCC acting chief executive James Richardson said. The average annual rate of GHG reduction outside the electricity supply sector over the previous seven years was 6.3mn t/CO2e, but this will need to more than double to 2030 if the UK is to meet its targets, the CCC found. The committee found that in order to reach targets, "annual offshore wind installations must increase by at least three times, onshore wind installations will need to double and solar installations must increase by five times" by 2030, while oil and gas use should be "rapidly" reduced. The CCC also recommended that around 10pc of UK homes will need to be heated by a heat pump by 2030, in comparison to approximately 1pc today. And the market share of new electric cars needs to increase to "nearly 100pc" by 2030, from a current share of 16.5pc. Labour pledged in its manifesto to restore the 2030 phase-out date for sales of new gasoline or diesel-fuelled cars, while it has set ambitious targets for renewable energy installations and pledged zero-carbon power by 2030. It has also committed to no new oil, gas or coal licences. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Climate finance goal is top priority: Cop 29 president


17/07/24
News
17/07/24

Climate finance goal is top priority: Cop 29 president

London, 17 July (Argus) — Addressing and aiming to finalise a new climate finance goal will be the "centrepiece" of the UN Cop 29 climate summit, the event's president, Mukhtar Babayev said today. Cop 29 is scheduled to take place in Baku, Azerbaijan, on 11-22 November. Babayev — officially Cop president-designate until the summit begins — is the country's ecology and natural resources minister. The Cop 29 presidency's "top negotiating priority is agreeing a fair and ambitious" new climate finance goal — known as the new collective quantified goal (NCQG) — Babayev wrote in a letter to countries and other stakeholders. He had previously been clear that finance will be a key topic at Cop 29. The NCQG represents the next stage of the $100bn/yr of climate finance that developed countries agreed to deliver to developing countries over 2020-25. But much is still up for discussion and must be finalised at Cop 29, including the amounts involved and timeframe. Babayev noted "disagreements", flagging that "the politically complex issues will not be solved by negotiators alone". The Cop 29 presidency has appointed Egyptian environment minister Yasmine Fouad and Danish climate minister Dan Jorgensen to lead consultations on the NCQG, Babayev said today. Announcements on ministerial pairs for other issues are expected in September, he said. "Adopting the NCQG will be a pivotal moment for whether parties can make progress on the means of implementation and support, and the Paris Agreement more broadly", Babayev said. Climate finance needs a "substantial increase", and the presidency "will spare no efforts to act as a bridge between the developed and developing nations", he added. Babayev also called for more financial pledges to the loss and damage fund , which countries agreed at Cop 27 to establish, to address the unavoidable effects of climate change in vulnerable countries. He encouraged all countries to submit national climate plans — known as nationally determined contributions (NDCs) — aligned with the Paris agreement, which seeks to limit the rise in global temperature to "well below" 2°C above pre-industrial levels, and preferably to 1.5°C. "The Cop 29 presidency will lead by example", Babayev said. Azerbaijan and its "Troika" partners, Cop 28 host the UAE and Cop 30 host Brazil, are working on 1.5°C-aligned NDCs, he said. The Article 6 mechanism of the Paris agreement, which relates to international carbon trading, will also be a priority at Cop 29, Babayev said. The presidency "is committed to finalising the operationalisation of Article 6 this year", he added. Cop 28 ended without a deal on Article 6, but "in recent months… there was clear will to advance work" on the topic, Babayev said. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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