Emissions must peak by 2025 for 1.5°C: IPCC

Spanish Market: Crude oil, Electricity, Emissions, Hydrogen, Natural gas, Oil products
04/04/22

Global greenhouse gas (GHG) emissions must peak before 2025 to keep global warming within Paris climate agreement limits, the Intergovernmental Panel on Climate Change (IPCC) said today, entailing a rapid shift away from unabated fossil fuel use.

Global GHG emissions must peak before 2025 at the latest in scenarios aiming to limit global warming to 1.5°C or 2°C compared with pre-industrial levels, the IPCC finds in its latest working group report on climate change mitigation. The 2015 Paris climate agreement aims to limit global warming to well below 2°C and preferably to 1.5°C.

GHG emissions must be reduced by 43pc and methane by a third by 2030 to meet the 1.5°C target, while GHG emissions would need to be cut by a quarter by the end of the decade to meet 2°C, the IPCC says, with "rapid and deep and in most cases immediate" reductions needed across all sectors for both targets. In either case it is "almost inevitable" that the temperature threshold will be breached temporarily, but it could be brought back below the limit by 2100.

The IPCC recognises that progress has been made in climate action. But policies implemented by the end of 2020 would still see emissions peak later than 2025, and lead to global warming of between 2.2-3.5°C by the end of the century, its report finds. They are also projected to yield higher GHG emissions than those implied by National Determined Contributions (NDCs), pointing to an "implementation gap", according to the report.

CCS to limit stranded assets

A "substantial reduction" in fossil fuel use in the energy sector is needed to meet either the 1.5°C or 2°C target, alongside widespread electrification, deployment of alternative fuels such as hydrogen, and improvements to energy efficiency.

Limiting global warming to these levels will lead to the stranding of fossil fuel assets, as soon as this decade in the case of coal installations and towards the middle of the century for oil and gas. The economic impact could reach trillions of dollars.

But the use of carbon capture and storage (CCS) would reduce the risk of stranded assets by prolonging the potential use of fossil-fuel installations. Without CCS, the world's coal-fired power plants would be forced to retire 23 years earlier than their expected lifetimes, and gas plants 17 years earlier, if the temperature targets to be met. New investments in coal-fired electricity without CCS are inconsistent with the targets, the report finds.

Beyond the energy sector

Achieving net zero emissions in industry — which produces around a quarter of global emissions — is "challenging but possible", the IPCC said. This will require coordinated action throughout value chains, including new production processes using electrification, hydrogen and "where necessary" CCS. Efficiency, reuse and recycling can also minimise industry emissions.

Established, new and rapidly growing cities all present options for emissions cuts, the IPCC finds, whether through the use of low-emission energy sources, zero-carbon buildings, or the electrification of transport. Electric vehicles using low-emission power "offer the largest decarbonisation potential for land-based transport on a lifecycle basis", the report concludes.

Demand-side mitigation through lifestyle and behavioural changes represents "untapped potential" which could cut emissions by 40-70pc by mid-century, provided the necessary policy, infrastructure and technology are in place, the IPCC said.

Land use mitigation can significantly reduce emissions, as well as removing and storing CO2 from the atmosphere. But this should not be used to compensate for delays in emissions cuts in other sectors, the IPCC warns.

It expects the use of carbon removals to be "unavoidable" to address hard-to-abate residual emissions. But the scale and timing of their deployment will be subject to the progress of emissions cuts in individual sectors.

By Victoria Hatherick

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23/10/26

Mexico's clean energy rollout still lags Latam

Mexico City, 23 October (Argus) — Mexico plans to nearly double its solar and wind power capacity to about 7.1GW by 2030, according to state utility CFE's sustainability plan, though it will still likely trail regional peers. The targeted asset push expands CFE's wind and solar footprint by 92pc against its combined wind and solar generation capacity baseline at the end of 2025, but dominant natural gas-fired generation is set to surge as well. Mexico's regulatory framework seeks to pivot from higher-emission fuels by targeting 15.2GW of total new clean energy capacity additions by 2030. This buildout ensures that clean energy accounts for 40pc of the total 38GW in new generation capacity slated to come on line under the current administration, according to the sustainability plan. Utility-scale solar and wind installations anchor the expansion. CFE's five-year development portfolio features nine solar plants totaling 4.67GW and seven wind farms totaling 2.47GW. The state also holds a 9.1GW pool of unallocated capacity under the plan. This includes 4.5GW of solar, 2.2GW of wind, 1.7GW of cogeneration and 0.8GW split across geothermal, solar thermal and hydrogen technologies. Despite the multi-GW solar and wind additions, total generation from all renewable and clean sources will grow by only 9pc by 2030 from a 2025 baseline, according to the sustainability plan. Slowing the curve This low growth rate reflects near-term fiscal tightening. The proposed federal budget places an inflation-adjusted 8.5pc cut on CFE's physical investment cap, Mexican public policy think tank (IMCO) said in an analysis. The federal proposal restricts CFE's direct physical investment budget to Ps61bn ($3.05bn), forcing the utility to shift approximately 55pc of its generation and grid capital expenditures to private-sector financing mechanisms. To preserve the required 54:46 public-private equity split, CFE will rely on $16.7bn in mixed-participation contracts with the private sector to shoulder utility-scale renewable deployment outside the federal budget. This reliance on complex financing structures slows the deployment curve of renewable energy. Gross clean energy output is projected to rise to 40.3TWh next year from 39.9TWh this year, according to the sustainability plan. Output will then climb to 44.5TWh two years later and peak at 46.6TWh in three years before dropping to 46.2TWh at the end of the decade, according to CFE's five-year plan. The state utility projects the drop-off will even out as construction delays push commercial start dates for a portion of the asset pool beyond 2030. The data baseline does not account for future tenders. But resulting lag widens the gap against regional peers chasing green manufacturing capital. Mexico targets a 36pc clean energy share in its total power matrix by 2030, according to the five-year plan. In contrast, Brazil already operates an electricity matrix that is 86.5pc from renewable energies today, while Colombia sits at 70pc, both replete with massive hydropower capacity, respective government plans show. Chile's is at 61pc, about split between hydropower and variable renewable energy. But by 2030, frameworks may have pushed Brazil to 92.5pc, Colombia to 84.1pc and Chile to 80pc cleaner power. Gas-fired generation endures To support this transition, state-owned Pemex is also coordinating with CFE to switch traditional thermal generation to natural gas-fired combined cycle technology from petroleum. This includes at CFE's Tula power plant, a major pollution contributor for nearby Mexico City, and its Salamanca, Altamira and Mazatlan plants. While traditional coal and fuel oil are scaled back, the net surge in natural gas generation outpaces the 15.2GW clean energy additions. Under the sustainability plan, combined-cycle gas turbine generation surges by 72pc over its 2025 baseline by 2030, representing 115.08 TWh of output. Clean energy generation rises only 9pc/yr, demonstrating that the grid remains structurally anchored to gas infrastructure. By James Young Share of generation from renewable energies % Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

China's climate influence faces coal test

23/10/26

China's climate influence faces coal test

Expectations of greater Chinese climate leadership may run ahead of Beijing's own ambitions Beijing, 24 October (Argus) — China's growing dominance in clean-energy manufacturing and deployment is increasing its influence over the global energy transition. But its expanding coal-fired power fleet sits at odds with expectations that Beijing could assume a larger leadership role at future UN climate conferences. The US' Paris agreement exit and concerns about economic growth in Europe have put the spotlight on China, with global climate goals in peril. Global renewable capacity more than doubled between 2016 and 2025, while renewable generation rose by 67pc, according to the International Renewable Energy Agency. China accounted for more than half of global solar capacity and nearly half of global wind capacity in 2025 — its solar capacity reached 1,202GW and wind capacity 641GW — underscoring its central role in the energy transition. China's climate contribution extends beyond its emissions trajectory. Its firms are central to supply chains for solar modules, batteries, electric vehicles and renewable fuels, and its manufacturing scale has helped lower the cost of clean tech. But it also operates the world's largest coal-fired power fleet and critics argue that industrial influence alone is not enough. Climate leadership ultimately requires a credible pathway to reducing fossil fuel use and emissions, observers say. But Beijing has shown little desire for a larger political role in climate governance. While speculation over a bid to host a future Cop has surfaced, China's official messaging still emphasises its developing-country status and the principle of common but differentiated responsibilities. The key test for China is whether clean power growth is sufficient to displace fossil fuel-based generation rather than simply meeting rising energy demand, UK-based think-tank Ember says. Clean energy met all China's incremental power demand in 2025 and coal-fired output fell, according to the Finland-based Centre for Research on Energy and Clean Air and US-based Global Energy Monitor. But China still added the most coal capacity in a decade, and the expansion continued in 2026, with 30GW commissioned in January-June, up by 43pc on the year. Work began on another 25.4GW, while just 2.7GW was retired, according to the two organisations. But rapidly retiring coal assets would create economic and reliability challenges. Beijing's path Beijing's response is not to pursue a European-style coal-retirement strategy. Instead, policymakers are looking to retain a substantial coal fleet while expanding renewables, storage and grid infrastructure. China's 2025-27 coal-fired power upgrade plan calls for greater flexibility to accommodate renewables, and another low-carbon transformation plan promotes biomass and ammonia co-firing and carbon capture, utilisation and storage. Questions remain over whether this pathway is a credible route to decarbonisation, as some analysts warn that ammonia co-firing and other retrofits could prolong the life of coal assets. Rather than pursuing leadership through international rule-setting or a fossil fuel phase-out agenda, China has sought to shape the transition through investment, industrial capacity and technology deployment. But for some western governments and climate groups, leadership is increasingly measured by political commitments, fossil fuel policies and international diplomacy. These competing visions in an era where technology deployment, industrial capability and diplomatic ambition do not always move at the same pace may help explain China's lack of enthusiasm for a greater political part. As China's role in the transition expands, the question may not be whether it can become a climate leader without a coal phase-out, but whether it is actually seeking the kind of climate leadership that much of the world increasingly expects it to assume. Top 5 solar producers 2025 Top 5 wind energy producers 2025 Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Energy security backs stalled fossil fuel shift

23/10/26

Energy security backs stalled fossil fuel shift

The Hormuz crisis has sparked interest in quick wins that could also have long-term benefits, writes Caroline Varin Edinburgh, 23 October (Argus) — Talks on transitioning from fossil fuels are unlikely to progress in official UN Cop 31 summit negotiations in Antalya, Turkey. But energy security concerns resulting from the US-Iran war are keeping the topic firmly on the international agenda. Initiatives such as a global roadmap to move away from fossil fuels, which the Brazilian UN Cop 30 presidency will present at this year's Cop 31 summit, will largely be dealt with outside of negotiations where decisions are taken by consensus. Major fossil fuel producers, which pushed back on the topic in Brazil last year, argue the transition was sufficiently addressed at Cop 28 in 2023 and that negotiations should focus on cutting emissions and not their sources. Discussions have stalled since Cop 28 concluded with a historic agreement on fossil fuels . This year may not be the time for transition discussions to be included in official Cop negotiations, International Institute for Sustainable Development (IISD) senior policy advisor Natalie Jones says. Such talks would "toxify" agenda items and probably result in more deadlock, she says. "That is not to say that formal negotiations are devalued, but it's a realistic assessment of where we are at." Phasing out fossil fuels remains critical and will be discussed at Cop 31, Dutch climate minister Stientje van Veldhoven said, adding that more countries will announce plans in Antalya. But this will happen as part of the informal summit's action agenda, where stakeholders meet to advance implementation. Turkey and Australia — presiding over Cop 31 — highlighted the importance of transitioning away from fossil fuels, but have yet to lead by example. Australia is the world's second-largest coal exporter after Indonesia, while Turkey is the seventh-largest coal importer, according to the IEA. "It makes sense to strategically start to plan to overcome the issue of demand decline," IISD's Jones says. "Turkey and Australia could help to show the way. If there are no leaders that step up in this regard, I think it's going to be a real problem." Umit Sahin, head of climate change studies at the Istanbul Policy Centre, does not expect a push from Turkey towards major producers on the question of transitioning away from fossil fuels. "Turkey appears to have decided that [the topic] itself is not a place to go in the formal Cop negotiations and has decided to approach it through electrification — from an end-use point of view," he said. Energy crisis/opportunity But the energy security crisis stemming from the US-Iran war is supporting clean energy development because this field offers quick solutions that will ultimately benefit climate action, IEA executive director Fatih Birol says. Economies reliant on Middle East oil and gas scrambled to secure supplies and implement measures to mitigate disruption — energy conservation, direct subsidies and tax cuts, for example. The crisis has also sharpened political focus on electrification. The crisis is a lesson for consuming countries , and the resulting shift towards electrification will affect oil demand, TotalEnergies chief executive Patrick Pouyanne has said. The IEA puts the global demand reduction since the start of the conflict at more than 1bn bl, driven by steep declines in China . There will be no more turning back from clean energy, utility EDF UK's non-executive chair, Alex Chisholm, told the FT Energy Transition Summit earlier this month. This will not be enough to meet the Paris goals, Birol warned, although he said he is hopeful about an agreement on electrification at Cop 31. Turkey set a goal for its action agenda to increase electricity's share of final energy demand worldwide to 35pc by 2035 . But the call sits outside of formal negotiations. Arab countries have signalled that they see no need for a "universal" agreement under the informal action agenda. Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Q&A: HGV fuel costs up by over a quarter: Logistics UK

23/10/26

Q&A: HGV fuel costs up by over a quarter: Logistics UK

London, 23 October (Argus) — Logistics UK outlines the increasing fuel costs borne by its members, who make up around half of all lorries on British roads, and how increases in fuel prices are being passed on to customers. But hauliers still see structural problems preventing them from electrifying fleets in the face of higher fuel costs. Its chief executive Ben Fletcher spoke to Argus , and edited highlights follow. What is Logistics UK's call to action in the context of the fuel price crisis facing its members? The Middle East conflict has impacted logistics and supply chains significantly, pushing up the price of fuel and increasing costs associated with managing supply chain disruptions. Since the conflict broke out in February, filling up an HGV has risen from around £750 to well over £1,000, and may go even higher. As logistics costs are embedded in everything we buy, from food and medicine to construction materials, increased costs for businesses directly translate into higher prices for consumers and communities. To reduce the risk of an inflationary impact and drive growth, Logistics UK is urging the Chancellor to maintain the current rate of Fuel Duty and the 5p cut and confirm this will continue into next year. The logistics sector already pays over £5bn a year in Fuel Duty, and even a 1p rise would cost £82.97mn. We are also calling for the reform of business rates, a significant fixed cost for the sector, and explicit recognition of logistics in the British Industrial Competitiveness Scheme. Doing so will be a significant step towards addressing the UK's high electricity rates, which will become more important as the decarbonisation transition gets underway. High rates risk dissuading operators from switching to electric fleets and must be addressed urgently. How have Logistics UK members been reacting to the rise in fuel prices? Have commercial operations had to adapt, and have driving behaviours changed? Has this meant that ultimately fewer miles are being driven? The logistics sector is resilient. Even as fuel prices have surged, it has continued to maintain customer service reliability and ensured the delivery of essential goods. Some businesses have responded to the rise in prices by adapting their procurement strategies and monitoring the market more closely. However, as logistics businesses operate on narrow profit margins, and any increases are likely to be passed onto customers, an increase in fuel prices results in higher prices for everyone. Beyond rising prices, are members experiencing any problems obtaining diesel, and how prepared are operators for a physical supply disruption or rationing? The primary issue with fuel is one of price, not supply. The government has reassured industry that the UK benefits from a strong and diverse security of fuel supplies, that it is monitoring stocks and sales closely and that production and imports are continuing across the UK as normal. The government has also confirmed that contingency planning in this area is well established, and that it has a range of measures it can use in the event that supply chains are disrupted. Logistics UK has stressed the importance of timely and clear communication with the sector when required. And are members changing how they buy fuel, for example through longer-term contracts, bulk purchasing or hedging, to reduce their exposure to price volatility? Businesses are adapting to volatile fuel costs through measures including fuel surcharges, more frequent monitoring of fuel prices and lead times and passing additional costs on to customers where possible, although not all businesses have the capacity to do so. But the conflict is not over, and the logistics sector will have to continue managing fuel price volatility, which makes it essential that the government maintains the current rate of Fuel Duty and focuses on keeping the cost of doing business down. Is Logistics UK aware of any fleet operator rationalisations or closures among its own members or elsewhere in the industry because of rising fuel costs? What percentage of overheads do fuel costs now represent? The slim margins the logistics sector operates on make this a very challenging time. Fuel represents one third of a business' operating costs, so increases in fuel drive up overall operating costs. What movements towards electrification has Logistics UK seen among its members, and does the group encourage them to consider integrating electric-powered vehicles into their fleets? The logistics sector is committed to decarbonisation, with operators making significant investments in battery electric vehicles. The light commercial vehicles (LCVs) segment has been particularly successful during the transition, registering 1.17mn on UK roads in 2024, a 34pc increase in the last decade. Major investments in charging infrastructure for electric HGVs has led to the opening of major hubs this year available for the public, alongside dedicated charging at businesses' depots. The first electric HGV crossed the English Channel on a freight train this year, demonstrating its operational viability over long distances, and how eHGVs can play a greater role in the movement of goods between the UK and EU in a safe, sustainable and efficient way. However, major barriers remain that are impeding progress. According to Logistics UK's decarbonisation survey, conducted in 2025, nearly 80pc of respondents are not confident that the government's phase out dates for diesel LCVs and HGVs will be met. This is due to barriers such as insufficient charging infrastructure, long grid waiting times and the absence of a co-owned industry and government roadmap that outlines clear timelines for the transition. Any decarbonisation approach taken will need to recognise the multimodal nature of the logistics network, as different transport modes are facing the same challenges of cost, technology readiness, infrastructure delays and fuel availability. Business group Logistics UK champions the logistics sector, the backbone of the UK economy and global trade, providing a unique, authoritative voice for its members. As the only trade association representing the whole industry, it supports more than 22,000 members, operating in road, rail, waterways, sea and air freight, in ports, airports and warehousing, as well as the customers of freight services such as retailers and manufacturers. The group delivers industry representation, services and thought leadership to support a sector that is critical to economic growth, employing 8pc of the UK workforce, contributing £175bn in annual GVA and enabling over £1 trillion of international trade. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Q&A: Grid projects key for western Balkans integration

23/10/26

Q&A: Grid projects key for western Balkans integration

London, 23 October (Argus) — Investing in upgrading and expanding interconnection capacity in the western Balkans is key for adding renewables, boosting energy security and integrating these markets with EU markets. The European Investment Bank (EIB) is playing a key role in facilitating such projects, including the first cross-border interconnector between Montenegro and Croatia, EIB's head of representation to Montenegro Davor Kunc told Argus' Apostolos Tsarikas in an interview. Edited highlights follow: How important are interconnection projects for the western Balkans and the region's further integration with European markets? Is the EIB currently involved in supporting such projects? Interconnection projects and grid modernisation are essential for the western Balkans' energy security and renewables integration. As the region's power systems are relatively small, stronger cross-border links enable electricity trading, sharing of balancing resources and more efficient use of storage, helping to reduce costs and improve system resilience. Projects such as the Trans-Balkan electricity corridor connect and strengthen multiple national systems, while making the market more attractive to investors by promoting common standards, greater competition and more efficient procurement. At the same time, regional co-operation should complement, not replace, national responsibility for project implementation and delivery. It should therefore focus on planning, prioritisation, interoperability, market rules and aggregation. Strengthening physical connections with the EU and aligning the region's electricity systems more closely with the European market also supports the western Balkans' broader path towards EU integration. The EIB is financing grid modernisation projects in Serbia and Bosnia and Herzegovina. Most recently, the EIB and Montenegrin transmission system operator [TSO] CGES jointly submitted a proposal for a WBIF [Western Balkans Investment Framework] technical assistance grant to support a pre-feasibility study for an electricity interconnection between Croatia and Montenegro. Montenegro already has 12 interconnectors with neighbouring countries, but none with Croatia. We hope this will become the 13th — and that 13 will prove a lucky number. What steps should western Balkan countries take to attract foreign capital and accelerate renewable investment? The main bottlenecks remain the project preparation, permitting and implementation capacity rather than a lack of funding. The priority is to bring projects to a mature, bankable stage. This means having robust feasibility studies, permits, environmental and social assessments, land acquisition arrangements and procurement plans in place before seeking financing. When these elements are addressed too late, projects often face redesigns, procurement delays and financing that cannot be deployed effectively. Importantly, a modern, fit-for-purpose and consistent regulatory environment provides the predictability investors need to make informed decisions. To help bring projects to a bankable stage, the EIB can combine long-term financing with advisory support under the Team Europe approach. EU grants are particularly valuable for project preparation, affordability measures and capacity building. They can also address the lack of funding. International financial institutions such as the EIB can provide long tenors, rigorous due diligence, high standards, guarantees and risk-sharing instruments. Moreover, as we never finance the total project cost, our role is to leverage further investments from both the private and public sectors. The EU's WBIF provides a proven platform for co-ordinating these resources. Examples include the Poklecani wind farm project in Bosnia and Herzegovina, which benefits from a €42mn ($47mn) EU grant alongside an EIB loan support. What characteristics make a renewable or interconnection project particularly attractive for EIB financing in the region? Several factors are critical. First, a project must address a clear energy system need and align with national or regional energy plans. It should be supported by a capable promoter with strong implementation capacity, clear accountability and robust governance arrangements. A stable and sustainable regulatory framework is equally important. Regulatory methodologies should allow prudent investment and operating costs to be recovered over time while ensuring vulnerable consumers are protected through targeted support measures. For public-sector projects, transparent and competitive procurement processes are essential. All projects financed by the EIB must also meet the bank's environmental, social and climate standards, and be supported by a credible delivery plan, including realistic costs, timelines and funding sources. Effective reporting, monitoring and risk-management mechanisms should be established from the outset. Our support extends beyond traditional lending. We also invest in well-structured equity funds that can help mobilise private capital for renewables. For example, the EIB has invested alongside Team Europe and other international partners in funds managed by Alcazar Energy. Through Alcazar Energy Partners II, this investment is expected to support the Bijela wind farm near Savnik in Montenegro, where construction could begin in the first quarter of 2027. This demonstrates how the EIB can work with partners to channel investment and accelerate the western Balkans' energy transition. Has the implementation of the Carbon Border Adjustment Mechanism (CBAM) affected project financing in the region? Have you observed any changes in foreign investor sentiment since its introduction? CBAM should be seen less as a cost and more as an investment signal. As European industry decarbonises, western Balkan companies that move early can strengthen their position in EU supply chains and attract new capital. The challenge is developing a sufficient pipeline of bankable projects. We are already seeing investors become more selective. Carbon exposure, regulatory predictability and alignment with EU climate rules increasingly influence investment decisions. At the same time, demand is growing for renewables, storage, grids and industrial decarbonisation projects that can reduce future carbon costs and strengthen energy security. The financing landscape is also evolving. Proven technologies can often attract commercial funding, while more innovative projects typically require a blend of grants, guarantees, concessional financing and long-term debt. This is where financial institutions like the EIB can play a key role by sharing risk, supporting project preparation and mobilising private investment. The EIB's Innovation and Green Transformation Facility is one example, combining credit lines, EU grants and advisory support for companies investing in innovation, digitalisation and green technologies. We have already launched the facility with commercial banks in Serbia and Albania and are keen to expand it across the region. However, many companies still lack the technical studies, emissions baselines, transition plans and implementation capacity needed to bring projects to a bankable stage. Access to affordable clean energy is another critical factor, as industrial decarbonisation increasingly relies on electrification and renewable power. Ultimately, investor confidence will depend on the pace of reforms. Stable regulation, credible carbon-pricing frameworks and robust emissions monitoring and reporting systems are becoming increasingly important for attracting capital. Through EIB Advisory, we are already supporting the development of green taxonomies in countries such as Albania and North Macedonia, helping establish clear definitions of sustainable investment and providing greater certainty for investors. Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

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