Germany's Landwärme declares insolvency
German biomethane supplier Landwärme has today declared insolvency under the country's self-administration procedure and has initiated restructuring measures "to overcome the consequences of the ongoing decline in prices of German greenhouse gas (GHG) emission reduction quota".
Self-administration proceedings are a proven legal framework in German restructuring law analogous to the US' Chapter 11 bankruptcy proceedings. They allow businesses to reorganise structures and financing while operations continue.
Landwärme attributed the price decline of German GHG tickets to an influx of imported, falsely-labelled biodiesel since the start of last year, as well as other alleged fraud cases regarding upstream emission reduction (UER) projects. Fake UER projects have caused the biofuel industry around €4.5bn in damages, according to the company.
Argus' Other GHG credits, GHG certificates which do not fall under caps for crop-based and Annex Part B biofuels, averaged €100/t CO2e in July, down from around €400/t CO2e in January 2023.
Landwärme is also looking to bring a "financially strong partner on board" to regain the necessary stability, it said, and intends to complete the restructuring as quickly as possible.
"This procedure could have been avoided if politicians and authorities had been more consistent in prosecuting and combating the alleged fraud cases in biodiesel and UER projects", managing director Zoltan Elek said.
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Western Australia to allow some onshore gas exports
Western Australia to allow some onshore gas exports
Darwin, 19 September (Argus) — Western Australia's (WA) state government will allow onshore developers of gas fields to export about 20pc of their output as LNG during a five-year window, in response to a growing failure to bring on new supplies for the domestic market. WA previously banned onshore gas exports, except in the case of Australian independent Beach Energy's 250 TJ/d (6.7mn m³/d) Waitsia stage 2 project . Beach may be required to share its infrastructure with fellow Perth basin firms, the WA government said, to expedite market access for new projects. Australian mining firm Mineral Resources, which has argued for permission to export 85pc of the gas from its Lockyer project as LNG and fellow WA-based firm Strike Energy may benefit from the changes, as both hold significant reserves in the Perth basin. The changes apply to new onshore developments or existing projects seeking to expand production. Developers are required to reserve 80pc of gas produced for WA, with this rising to 100pc from 2031 onwards. The policy shift follows dire outlooks for WA's gas supplies as the state attempts to wean itself off coal-fired power generation. It currently contributes about a third of the electricity into the state's largest power grid. A parliamentary report last month warned WA cannot rely on sporadic appeals for more gas to meet demand. "These policy changes are sensible responses that balance the need for Western Australia to secure its energy future while encouraging onshore producers to bring on more gas supply as and when it is needed," mines and petroleum Minister David Michael said on 19 September. The 15pc reservation for offshore LNG projects will continue, while WA has promised more transparency on the policy with the publication of a yearly WA Domestic Gas Statement to reveal how producers are meeting obligations, with a review to take place after two years. An interim parliamentary report tabled earlier this year showed about 8pc of the state's offshore gas output has reached WA consumers since 2006, representing just over half the required volumes. Following public criticism of LNG producers' contributions, Australian independent Woodside Energy has since pledged an extra 32PJ (854mn m³) of domestic supplies by the end of 2025 . WA will also seek to strengthen laws designed to prevent companies banking prospective onshore oil and gas tenements, with a review into the "use it or lose it" policy to be led by the state's energy department. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US Fed cuts rate by half point, signals more: Update
US Fed cuts rate by half point, signals more: Update
Adds chairman Powell comments, economic projections. Houston, 18 September (Argus) — The US Federal Reserve cut its target interest rate by 50 basis points today, the first rate cut since 2020, with policymakers signaling they expect to make another half-point worth of cuts by the end of 2024. The Fed's Federal Open Market Committee (FOMC) lowered the federal funds rate to 4.75-5pc from the prior range of 5.25-5.5pc, which was a 23-year high. The Fed had kept the target rate unchanged since July 2023 after hiking it for more than a year in the most intense rate-tightening campaign in four decades to quash inflation, which peaked at 9.1pc in mid-2022. "The committee has gained greater confidence that inflation is moving sustainably toward 2pc, and judges that the risks to achieving its employment and inflation goals are roughly in balance," the FOMC said in its statement after the two-day meeting. "Job gains have slowed, and the unemployment rate has moved up but remains low." In their latest economic projections, the Fed board and policymakers expect the target rate range will end 2024 near a midpoint of 4.4pc compared with an end of year midpoint of 5.1pc projected in June, which implies further cuts amounting to 50 basis points by the end of 2024. Policymakers also penciled in another 100 basis points of cuts over the course of 2025. "We're recalibrating policy down over time to a more neutral level and we're moving at the pace that we think is appropriate given developments in the economy," Fed chair Jerome Powell told a press conference after the meeting. "The economy can develop in a way that will cause us to go faster or slower. The US economy is in a good place and our decision today is designed to keep it there." The Fed's economic projections see core Personal Consumption Expenditures inflation — the Fed's favorite measure of inflation — ending 2024 at a median rate of 2.6pc, down from a prior forecast of 2.8pc. Policymakers see core PCE inflation falling to a median of 2.2pc by the end of next year. The outlook for the unemployment rate for the end of 2024 climbed to 4.4pc from 4pc penciled in at the June meeting. Policymakers expect gross domestic product (GDP) growth to end 2024 at an annual 2pc, slightly down from a prior 2.1pc projection. The latest policy meeting comes as the Consumer Price Index (CPI) eased to an annual 2.5pc in August , down from 2.9pc in July, the Labor Department reported on 11 September. Inflation had ticked up to 3.5pc in March from 3.1pc in January, prompting the Fed to turn more cautious about beginning its rate cuts. US job growth has recently slowed sharply, falling to an average 116,000 in the three months through August from 211,000 for the prior three months. The jobless rate rose to 4.3pc in July, the highest in three years, before edging down to 4.2pc in August. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Volatile energy prices risk the transition: IEF
Volatile energy prices risk the transition: IEF
Houston, 18 September (Argus) — High or volatile energy prices risk undermining emissions reductions efforts, International Energy Forum (IEF) secretary-general Joseph McMonigle said today at the Gastech conference in Houston, Texas. "If the public starts to connect high prices and volatility to the energy transition, we're in big trouble and we risk losing public support for the transition and climate policy," he said. McMonigle made his comments on a panel with several energy ministers, who discussed the issues of balancing energy security concerns with transitioning to cleaner fuel sources for electricity. When asked what he would consider a "call to action" for the global energy sector, McMonigle suggested investments in emerging technologies. "I think to allow trading of carbon credits is really important to accelerate the transition," he said. "Also, to provide financing for CCS (carbon capture and storage), which I think is one of the technologies that does not have enough investment behind it." By David Haydon Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US Fed cuts rate by half point, signals more to come
US Fed cuts rate by half point, signals more to come
Houston, 18 September (Argus) — The US Federal Reserve cut its target interest rate by 50 basis points today, the first rate cut since 2020, with officials signaling they expect to make another half point worth of cuts by the end of 2024. The Fed's Federal Open Market Committee (FOMC) lowered the federal funds rate to 4.75-5pc from the prior range of 5.25-5.5pc, which was a two-decade high. The Fed had kept the target rate unchanged since July 2023 after hiking it for more than a year in the most aggressive increase campaign in four decades to quash inflation, which peaked at 9.1pc in mid-2022. "The committee has gained greater confidence that inflation is moving sustainably toward 2pc and judges that the risks to achieving its employment and inflation goals are roughly in balance," the FOMC said in its statement after the two-day meeting. "Job gains have slowed, and the unemployment rate has moved up but remains low." The Fed board and policymakers, in their latest economic projections, expect the target rate range will end 2024 near a midpoint of 4.4pc compared with an end of year midpoint of 5.1pc projected in June, which implies further cuts amounting to 50 basis points by the end of 2024. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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