Australia to tighten gas, coal emissions rules
The Australian federal Labor government has secured the support of the Greens party in passing its reform to the safeguard mechanism, which is central to a target of reducing greenhouse gas emissions by 43pc of 2005 levels by 2030.
The Greens backed down on calls to ban all new coal and gas projects but secured an amendment that all new gas developments must have net zero scope 1 emissions. This has derailed the planned onshore wells in the Beetaloo basin and Australian firm Santos' offshore Barossa gas field by increasing cost of development, according to Greens leader Adam Bandt.
This could disrupt the planned refurbishment and restart of the 3.7mn t/yr Darwin LNG project in the Northern Territory. The Barossa field, which underpins the restart of Darwin LNG, is already facing delays because of culturally significant underwater sites. Tamboran Resources, which was also considering supplying gas to the plant, is developing a gas venture in the Beetaloo basin.
The safeguard mechanism also now has a hard cap on emissions, so that they cannot go up, even if industries like coal and gas production grow. This will mean about half of the 116 new coal and projects will be stopped from going ahead, according to Bandt.
The environmental approvals of new projects will now include an assessment of whether they will meet their emissions obligations under the safeguard mechanism, which could lead to fewer coal and gas projects being approved in Australia. The government's Climate Change Authority will seek to update methane measurement, verification and reporting in time for implementation by 1 July 2024. Methane is a major greenhouse gas emission from coal and gas projects.
The support of the Greens and two independent MPs will allow the safeguard mechanism to come into effect from 1 July 2023. The revised mechanism will require emissions-intensive trade-exposed (EITE) entities to explain to the regulator if they are using more than 30pc offsets to meet their requirements to cut net emissions.
Australian Carbon Credit Units (ACCUs) cost around A$38/t ($26/t) on 27 March and will be capped at A$75/t under the scheme. ACCUs peaked around A$57/t in January 2021 before returning to trade between A$25/t and A$35/t since late February 2021, according to the Clean Energy Regulator.
EITEs other than coal and gas will be eligible for up to A$1bn in funding, with A$400mn targeted at industries like steel, aluminium and cement that are needed for renewable energy.
Canberra will also review the feasibility of an Australian carbon border adjustment mechanism similar to the one in place in the EU and focused on the steel and cement sectors.
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G20 seeks to ease climate funding to cities
G20 seeks to ease climate funding to cities
Sao Paulo, 21 May (Argus) — Climate funds need to make it easier for countries and especially individual cities to access resources, a G20 working group said in Brazil today. Experts, representatives of G20 member countries and financial organizations gathered in Rio de Janeiro to discuss ways to leverage financing to face extreme climate events. The two-day event was hosted by the G20 — which Brazil presides over this year — the country's finance minister, global network Finance in Common (FiCS) and the Brazilian NGO climate and society institute (iCS). Delegates agreed that climate funds — especially the green climate fund, the adaptation fund, the global environment facility fund and the special climate change fund, which will hold a combined $30bn in the next five years — need to allow better access for cities to combat climate change. That means easing bureaucracies and identifying bottlenecks, according to Ivan Oliveira, deputy secretary for sustainable development at Brazil's finance ministry. Guaranteeing funding for climate projects can take many years, Oliveira said. But "climate change requires climate funds to deliver quickly," he added. FiCS' chairman Remy Rioux — who is also the chief executive of France's development agency — pointed to the different accreditation processes for different climate funds as hindering climate financing. A single accreditation process would ease access, he added. "We will do our best to find innovative financial solutions for climate resilience and resilient infrastructure," he said. Climate projects should also be able to tap into multiple funds more easily, Oliveira said. Rioux also called for the creation of an international guarantee fund to back individual national banks should they need resources to combat climate change. Additionally, local governments should be able to deal directly with climate funds, instead of having to work through the federal government, he added. The director of Brazil's development bank Nelson Barbosa also noted that a lack of financial guarantees and exchange rate volatility hinder banks and country's ability to access climate funds. The G20 working group will present a report with suggestions to address these issues in July, in Belem — the capital of northern Para state — Oliveira said. The city will also host Cop30 in 2025. Rio Grande do Sul Brazil's federal government is discussing a line of credit to southern Rio Grande do Sul state, which has been hit by heavy rainfall and historic flooding since late April, Barbosa said. "A special line of credit will be needed for reconstruction," he said. "We already have lines for adaptation and mitigation and now we have to think about lines to take care of losses and damages. Reality has arrived, and development banks have to deal with the effects of the climate." But he did not give further specifics on the measures. On Monday, President Luiz Inacio Lula da Silva called for the creation of an international fund backed by "people that pollute the planet" to aid Rio Grande do Sul. He has in the past called on rich nations to fund global efforts to mitigate climate change. Rains in Rio Grande do Sul have left 161 people dead, 85 missing and over 581,600 people displaced, according to the state's civil defense. Rebuilding the state will cost over R19bn ($3.7bn), according to the state government. By Lucas Parolin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Brazil biomethane parity prices R2.43-2.79: Correction
Brazil biomethane parity prices R2.43-2.79: Correction
Corrects CNG truck round-trip freight rates in 8th paragraph. Sao Paulo, 21 May (Argus) — Biomethane parity prices in Sao Paulo and Rio de Janeiro states, Brazil's two largest hubs, ranged between R2.43-2.79/m³ (49-56¢/m³) on 23 February, according to the market's first price indicators launched by Argus . That represents the marginal price that can be charged by biomethane producers from gas distributors, reflecting daily Cbio carbon credits assessments and weighted averages of natural gas prices in Rio de Janeiro and Sao Paulo. It is the first specifically calculated Brazilian biomethane price indicator in a market that has often lacked transparency. Biomethane producers traditionally have determined their prices on a case-by-case basis, depending on a series of factors such as the consumer's need for the green attribute, which fuel the biomethane gas will substitute and logistics costs. Initially, the biomethane sector looked to LPG prices for reference, as industry machinery only needs small alterations to substitute one fuel for the other. But the LPG market is much more consolidated and stable in its supply than biomethane. The international crude industry and Brazilian real-dollar exchange rates also influence the market, leading to distortions that do not reflect the renewable natural gas (RNG) market's true conditions. Market participants are still learning the ropes of the biomethane sector, as all of its production and supply structures are new in Brazil, according to Hugo Nery, chief executive of landfill company Marquise Ambiental, part of the joint venture that controls the 110,000 m³/d GNR Fortaleza biomethane plant. All biomethane plants certified by hydrocarbons regulator ANP within Brazil's national biofuels Renovabio policy are eligible to issue Cbio carbon credits, which is a compliance market for fossil fuel distributors to compensate their sales' impact. But this segment is still much smaller than it could be for biomethane manufacturers, according to biomethane producer Gas Verde's chief executive Marcel Jorand. Still, Cbios are the most liquid alternative to pricing the green attribute of biomethane in Brazil, with other certification models still in preliminary stages and not openly traded. Producers are adopting their own solutions to biomethane transportation challenges. Marquise Ambiental's strategy is to build its new biomethane plants near distribution networks, Nery said. GNR Fortaleza was the first plant in Brazil to inject biomethane directly into a distribution network and supplies 20pc of Ceara state's gas demand. On the other hand, biomethane generators Gas Verde and Zeg Biogas supply their customers through CNG truck deliveries. Argus ' CNG truck freight rates, based on Sao Paulo costs, show that each cubic meter of gas delivered on a 150km (93.2-mile) round trip cost R0.005/km on 23 February. Gas Verde and Zeg Biogas eye opportunities for longer-distance deliveries, using LNG trucks that have more range compared with CNG truck freights, or injecting gas into pipelines. Biomethane producers are finding demand for RNG outstripping supply available to the market. Zeg Biogas expects to start up a 30,000 m³/d biomethane plant in Minas Gerais state on the second half of the year. The company aims to explore the off-grid market in the region and expects to sign four additional contracts this year and increase its production capacity, according to chief executive Eduardo Acquaviva. Gas Verde, which owns Brazil's largest biomethane plant in Seropedica, Rio de Janeiro state, with 204,000 m³/d of capacity, also expects to expand. The company will transform nine biogas-fired thermal power plants into biomethane generators in the next 18-24 months. By Rebecca Gompertz Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UK will not bank ‘surplus’ from third carbon budget
UK will not bank ‘surplus’ from third carbon budget
London, 21 May (Argus) — The UK overachieved on emissions reduction targets under its third carbon budget, but it will not carry forward the emissions ‘surplus' to the next carbon budget, the government said today. A carbon budget is a cap on emissions over a certain period. The UK's third carbon budget covered 2018-22, while the fourth carbon budget covers 2023-27. UK emissions over 2018-22 stood at 2.15bn t/CO2 equivalent (CO2e) — 319mn t/CO2e below the third carbon budget cap. Emissions on average over the period were 47pc lower than emissions in 1990 — the baseline year. "By the end of the period in 2022, UK net greenhouse gas emissions were 50pc lower than base year emissions", the government said. The country is also on track to overachieve during the fourth carbon budget, it added. "The government decision not to carry forward the surplus keeps the UK within its ambitious target with no additional headroom to emit greenhouse gases over the coming years", the government said. The UK has made progress on cutting emissions, including phasing out coal. But the surplus was largely down to external factors, including the Covid-19 pandemic, the independent advisory Climate Change Committee (CCC) found previously. The UK has a legally-binding target to reach net zero emissions by 2050. It also has targets to cut emissions by 68pc by 2030 and 77pc by 2035, both from the 1990 base level. The CCC warned in February that the government should not carry forward any surplus from the third carbon budget, to avoid weakening action on decarbonisation. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
States have duty to cut GHGs, protect oceans: Court
States have duty to cut GHGs, protect oceans: Court
London, 21 May (Argus) — States that are party to the UN Convention on the Law of the Sea (Unclos) have an obligation to reduce their greenhouse gas (GHG) emissions to protect oceans, the International Tribunal for the Law of the Sea said today in an advisory opinion. The opinion was requested by the Commission of Small Island States on Climate Change and International Law in December 2022. The tribunal found unanimously that states party to Unclos "have the specific obligation to take all measures necessary to ensure that anthropogenic GHG emissions under their jurisdiction or control do not cause damage by pollution to other states and their environment". The group of small island states welcomed the outcome, and said they saw it as a victory. Small island states are extremely vulnerable to the effects of climate change. Unclos has 169 parties — including the EU, China and almost all G20 nations. But the US — the second-highest emitter — is not a party to the convention. Countries must submit new national climate plans — known as nationally determined contributions (NDCs) — by early next year to UN climate body the UNFCCC. "Today's outcome will be instrumental to push the countries most responsible for the climate crisis to ramp up their ambition", lawyer at environmental law firm ClientEarth Lea Main-Klingst said. "And because business must follow where governments lead, companies and financial institutions are going to feel a knock-on effect from this development, too", Main-Klingst added. Similar cases, focused on climate change, are awaiting an advisory opinion or ruling from various international courts. The Inter-American Court is hearing arguments on how climate change is affecting human rights this month, while the International Court of Justice will consider a similar question later this year. The European Court of Human Rights ruled last month that signatories to the European Convention on Human Rights (ECHR) must protect their citizens from the "serious adverse effects of climate change", in a landmark ruling for climate litigation. The ocean is the world's biggest carbon sink, capturing emissions and much of the excess heat generated by GHGs. Sea surface temperatures have hit record highs in recent months, while the global temperature was in 2023 on average 1.45°C higher than pre-industrial levels , the World Meteorological Organisation said earlier this year. 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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