UK to set up green infrastructure bank
The UK will set up a bank aimed at investing in green infrastructure, chancellor Rishi Sunak said today during his 2021 budget announcement.
The bank will be able to deploy £12bn of equity and debt capital and issue up to £10bn of guarantees. It should support up to £40bn of total investment, Sunak said.
The institution, which will be based in Leeds, will begin operating in an interim form later in spring 2021, the budget statement said.
Sunak also said the government would aim to position to city of London as the leading market for voluntary carbon offsets. A new working group will be established to this end.
The carbon price support will remain at £18/t of CO2 equivalent until 2022-23. The tax has accelerated the UK power sector's shift from coal to gas, and keeps the UK power market at a wide premium to continental European markets. The government will also set out additional proposals for expanding the scope of the UK emissions trading system scheme over 2021.
And it was confirmed the UK will issue its first sovereign green bond this summer and look to quickly build out a green yield curve. Green gilt issuances will be a minimum of £15bn in 2021-22, to finance projects aimed at tackling climate change and other environmental challenges.
The government's pledge of funding for new port infrastructure in Teeside and Humberside "to support the next generation of offshore wind projects" was welcomed by industry association RenewableUK as a "gamechanger." Teeside and the Humber were also announced as two of eight "freeports" that will have different customs rules and taxes than the rest of the country. This should drive investment in offshore wind manufacturing, RenewableUK said.
The budget included some smaller green initiatives, including the launch of a £20mn programme to support the development of floating offshore wind technology across the UK, the launch of a new £68mn UK-wide competition to implement several first-of-a-kind energy storage prototypes or technology demonstrators, and a £4mn UK-wide competition for the first phase of a biomass feedstocks programme.
Government advisory body the climate change committee's chief executive, Chris Stark, said there was "not much to say about this budget — a comment in itself."
Related news posts
La deuda de Pemex sobresale en el panorama electoral
La deuda de Pemex sobresale en el panorama electoral
Mexico City, 15 April (Argus) — La campaña presidencial de México termina en menos de dos meses, pero aunque ambas candidatas proponen una revolución verde en el sector de la energía, ninguna de ellas ha propuesto un plan viable para evitar la implosión financiera de la empresa estatal Pemex. Claudia Sheinbaum, candidata de continuidad para la política energética nacionalista del Presidente Andrés Manuel López Obrador, anunció el mes pasado su estrategia energética, comprometiéndose a aumentar la producción de petróleo y gas de Pemex, aumentar el rendimiento de las refinerías y la producción petroquímica, desarrollar una industria nacional de litio y buscar un nuevo enfoque en la generación de energía renovable. La antigua jefa de gobierno de la Ciudad de México no ha proporcionado detalles sobre ninguna de estas políticas, pero es difícil conciliar su compromiso con una ampliación de las energías renovables con un límite en la inversión del sector privado sin depender en gran medida del aumento de la financiación de la estatal de electricidad CFE. La política de Sheinbaum en materia de energías renovables es la única desviación de la agenda energética de López Obrador, aunque las agencias de calificación, los inversores y los analistas coinciden en que es probable que Pemex incurra en impago sin una amplia reforma estructural. Pemex tenía una deuda total de $106,100 millones a finales de 2023 y se enfrenta a $10,000 millones en vencimientos de deuda este año. El impulso del gobierno para aumentar el rendimiento de las refinerías ha generado pérdidas de miles de millones de dólares para Pemex. Solo en 2023, la división de refinación de Pemex reportó una pérdida de $4,400 millones, una mejora con respecto a una pérdida de $11,000 millones el año anterior. De 2019 a 2023, la división de refinación de la empresa registró más de $46,000 millones en pérdidas. López Obrador puso el rescate de Pemex y sus refinerías en el centro de su administración. Pero a pesar de no detener la espiral de deuda de la empresa, la disminución de la producción de crudo, el empeoramiento del récord de seguridad y el aumento de las emisiones de gases de efecto invernadero, sus políticas han tenido un coste que Sheinbaum no ha querido refutar públicamente. En su lugar, se compromete a lanzar el proyecto de la refinería Olmeca de 340,000 b/d de la empresa, que ya tiene dos años de retraso y ha costado al menos el doble del presupuesto original de $8,000 millones, dinero que las agencias de calificación afirman que debería haberse dirigido al negocio principal de Pemex en la exploración y producción. El apoyo gubernamental a Pemex, por un total de más de $52,000 millones entre 2019 y 2023, ha sido incapaz de mover la aguja en sus métricas financieras u operativas, y ahora amenaza la calificación crediticia soberana de México. Sheinbaum ha evitado abordar públicamente la carga de la enorme deuda de Pemex, proponiendo únicamente "niveles de deuda aceptables en el sector de la energía". Pero dada la importancia de Pemex para el proyecto político del partido Morena, además los cientos de miles de puestos de trabajo que dependen de Pemex, no se puede permitir que la empresa incumpla. Por otro lado, la candidata de oposición Xóchitl Gálvez pide poner fin al "caos financiero" en Pemex, diversificar su negocio hacia iniciativas de bajas emisiones de carbono, políticas rigurosas de emisiones, el cierre de sus refinerías más contaminantes, un nuevo enfoque en renovables y una reapertura de la industria energética a la inversión del sector privado. Sin embargo, a pesar de su perspectiva más favorable para la inversión privada, Gálvez aún no ha ofrecido una solución detallada para la situación financiera de Pemex. Sus planes para Pemex pueden ser demasiado radicales para los votantes, especialmente dentro del importante sindicato de trabajadores del petróleo, que repudió rápidamente sus llamados el mes pasado para cerrar dos refinerías. Incluso si ganara, la oposición que representa podría tener dificultades para acordar un camino a seguir para Pemex. Si la próxima administración vuelve a abrir la puerta a la inversión del sector privado, el nuevo gobierno se enfrentará a un esfuerzo lento para reconstruir los reguladores de la energía que han sufrido de baja inversión en los últimos seis años. Pero será el tamaño de la posible victoria de Sheinbaum lo que determinará el futuro del sector de la energía mexicano. Una mayoría convincente podría permitirle aprobar las grandes reformas energéticas que eludieron a López Obrador y seguir limitando la participación del sector privado en el sector energético, justo cuando la inversión directa extranjera en México está en auge en otras industrias. Por Rebecca Conan Producción de crudo en México Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
German power spot index to deliver above expectations
German power spot index to deliver above expectations
London, 15 April (Argus) — The German power spot index has delivered below over-the-counter (OTC) expectations in April as wind and solar output have averaged above seasonal norms. But forward prices suggest that the spot index is on track to deliver above OTC expectations on declining wind generation in the second half of the month. The German spot index averaged €50.49/MWh over 1-16 April, below the April OTC contract's expiry of €54.90/MWh. But the index is on track to deliver at around €58.46/MWh across the month, based on the weighted-average of the expiry of week 16 at €65.70/MWh and the latest assessments of weeks 17 and 18 at €71.20/MWh and €59.50/MWh, respectively, and the spot index in April. Combined onshore and offshore wind generation has climbed to 19.65GW this month, well above the 13.4GW average for April 2019-23. And solar output has averaged above 8.6GW, a new high for April. Rising renewable output has weighed on thermal generation, with combined gas, coal and lignite-fired output down to 10.5GW, the lowest of any month in over seven years. Working day-ahead clean dark spreads for 40pc-efficient plants have averaged minus €28.46/MWh for delivery on 1-15 April from minus €13.88/MWh in March. Clean spark spreads for plants with 55pc efficiency have fallen by €14.68/MWh on the month and into negative territory at minus €11.17/MWh. And clean lignite spreads for 36pc-efficient plants have averaged minus €13.51/MWh from €0.29/MWh last month. The seasonal rise in temperatures has also lowered demand by 1.6GW on the month to 50.35GW in April, outpacing the month-on-month decline in generation by over 300MW. And Germany has been a net exporter on six days this month, compared with seven days in all of March . But wind output is forecast to remain below the 2019-23 average on most days in the second half of the month, data from analytics platform Kpler show, while peak-load solar output is expected to remain below a load factor of 30pc — or 16GW — over 16-21 April, which could support the spot index and imports. And the May contract rose to its highest in almost three months on its latest assessment on 12 April at €64.60/MWh, up from under €50/MWh on its first assessment as the front month. Thermal generating margins for base and peak-load delivery in May have averaged well below zero in April, with even higher-efficiency coal, lignite and gas-fired plants priced out of the mix. Germany is likely to continue importing from its Swiss and French neighbours in May. Swiss hydropower stocks widened their surplus to the long-term average in week 14, while precipitation in Sion is forecast well above seasonal norms next month and Alpine snowpack is well above average, which could boost inflows when snowmelt picks up in May. And French nuclear unavailability is forecast to drop by 4GW on the month to 15.6GW in May, well below the 25.4GW in May last year. By Adrien Seewald German April power generation GW Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Singapore consortium to form emissions registry
Singapore consortium to form emissions registry
Singapore, 15 April (Argus) — A consortium of firms led by the Singapore Business Federation (SBF) will set up a registry to help local businesses establish more accurate emission inventories, the SBF announced today. The SBP is partnering the Agency for Science, Technology and Research, consultancy PwC and telecommunications group Singtel to set up the Singapore Emission Factors Registry (SEFR). The first phase of the registry is targeted to be ready by the end of this year. The SEFR will consist of an emission factors (EFs) database that is reflective of local conditions, according to the SBF. The EFs will allow for the conversion of business activities into greenhouse gas emissions. More details on how this conversion will be carried out were not provided, although the SEFR "supports existing reporting tools and solutions in the ecosystem that help enterprises automate their sustainability reporting process," said the SBF. Singapore businesses are currently using EFs from international sources such as the US Environmental Protection Agency and UK Department for Environment, Food and Rural Affairs in their carbon emissions reporting, especially for scope 3 emissions. The "localised" EFs will be developed in phases, and the initial base load for the first phase will be made up of data from various government agencies, in relation to transportation, water, general waste and energy. EFs for additional categories will be developed and released based on demand and after industry consultations. Three-quarters of local businesses have already implemented or plan to implement environmental, social and governance (EGS) practices into their operations, according to a survey by the SBF. But 60pc of businesses stated they require support in areas of funding, greater clarity on EGS reporting metrics and access to ESG tracking and measurement technology. "With the development of localised EFs, local businesses will be able to report their emissions more accurately," said SBF chief executive Kok Ping Soon. "The SEFR is part of a broader suite of programmes that SBF will progressively be rolling out to support businesses in their net zero transition," he added. This is the latest in a series of moves Singapore has taken to create a carbon market as part of its decarbonisation efforts. The country in June last year launched a spot trading platform for carbon credits . It subsequently in December published a list of eligible international carbon credits under the International Carbon Credit framework, which companies can use to offset up to 5pc of their carbon tax liability , in lieu of paying the carbon tax. Singapore's carbon tax has been set at S$25/t ($18/t) for 2024-25 and will subsequently be raised to S$45/t in 2026-27. The tax will be reviewed with a long-term view of increasing it to S$50-80/t by 2030. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Australia’s Origin buys 1.5GW wind, battery project
Australia’s Origin buys 1.5GW wind, battery project
Sydney, 15 April (Argus) — Australian upstream and utility firm Origin Energy has entered an agreement with renewables developer Virya Energy to acquire the 1.5GW wind, 800MWh battery Yanco Delta project in New South Wales (NSW). Origin will pay up to A$300mn ($194mn) for the project, starting with an upfront payment of A$125mn and an additional payment of up to A$175mn dependent on Yanco Delta achieving some development milestones. Yanco Delta — one of the largest and most advanced wind and energy storage projects in NSW — will allow Origin to bring a "material volume of renewable energy supply into the market relatively quickly", chief executive officer Frank Calabria said. Yanco Delta received development approval from the NSW government last December and federal approval under the Environment Protection and Biodiversity Conservation (EPBC) Act in February, with grid connection rights expected to be the next major milestone for the project. "Securing transmission access rights is a key near term priority for the project, which subject to the timing of the access rights tender process, we anticipate occurring before the end of the 2024," an Origin spokesperson told Argus on 15 April. "Timing for development will ultimately be confirmed once we have all aspects of the project finalised, EPC contractors engaged, and a final investment decision is taken." The Australian Energy Market Operator (Aemo) manages access rights via a competitive tender process. Virya Energy previously said it expected the final investment decision and the start of construction for 2025-26, with completion between 2027-29. Yanco Delta will be located some 10km northwest of Jerilderie in the Riverina district, in NSW's South West Renewable Energy Zone (REZ). It could be one of the biggest renewable plants helping to replace ageing coal-fired plants in NSW, with three of the four remaining facilities in the state — Origin's 2,880MW Eraring, utility AGL's 2,640MW Bayswater and utility Delta Electricity's 1,320MW Vales Point — expected to close over the next decade. Virya Energy estimates Yanco Delta could avoid between 3.3mn-4.5mn t/yr of greenhouse gas (GHG) emissions. Origin was the fourth largest GHG emitter in the 2022-23 fiscal year to 30 June, according to the Clean Energy Regulator (CER). The utility has been in talks with the NSW government to extend Eraring's operations beyond its planned August 2025 closure , while stepping up renewable investments in recent months. It in February acquired developer Walcha Energy, which is developing the Ruby Hills wind and Salisbury solar projects with more than 1.3GW of combined capacity. By Juan Weik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more