California RD plant signals later start up

Spanish Market: Biofuels, Emissions
12/11/24

An long-delayed project to convert a Bakersfield, California, oil refinery to produce renewable diesel (RD) has been given another extension for start up.

Global Clean Energy Holdings, working to open a 15,000 b/d RD refinery, and trading house Vitol agreed last week to adjust the terms of a supply and offtake deal singed in June. The initial agreement said that Vitol could exit the agreement if the refinery was not producing at least 5,000 b/d of renewable diesel by the end of October, but that deadline has now been moved to 15 December.

Global Clean Energy told Argus last month that it still has "plans in place to complete the remaining work and start up the facility" despite recently cancelling an agreement with its principal contractor.

Vitol, after an initial three-year term, can now request up to three one-year extensions of the contract, up from two in the initial deal. The agreement, which cleared the way for former business partner ExxonMobil to exit, stipulates that Vitol will be the exclusive supplier of feedstocks to the plant and exclusive marketer of all fuel and environmental attributes.

The revised agreement also says that if Global Clean Energy modifies its credit agreement to allow for more than $330mn in debt financing, then the renewable fuels producer will have to pay Vitol an additional fee that increases as more funds are borrowed. Global Clean Energy declined to clarify whether it had already triggered the obligation to pay Vitol the excess fee, saying that it could not provide more information ahead of filing its quarterly investor report "in the near future."

If the plant begins operations as planned, it will have to contend with a challenging investment environment for biorefineries given recently low environmental credit prices and uncertainty around how president-elect Donald Trump will enforce a new federal clean fuels tax credit.

At the same time, California regulators agreed last week to update the state low-carbon fuel standard, including by setting stricter carbon intensity targets that start next year. The regulatory updates lifted the prices of credits used for program compliance, which are a crucial source of revenue for companies bringing lower-carbon fuels like renewable diesel into the state.

By Cole Martin

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17/06/25

Brazil's Amazon Fund approves over R1bn in 1H

Sao Paulo, 17 June (Argus) — Brazil's Amazon Fund has approved about R1.19bn ($215mn) to finance projects submitted in the first half of 2025, about 25pc more than it financed in all of last year and double the financing in 2023. The fund — which issues grants to projects that prevent, monitor and combat deforestation while promoting conservation and sustainable development in the Amazon forest — invested more in the first six months of the year than it has in any year since project funding started in 2009, according to Brazil's development bank Bndes and environment ministry (MMA). The fund approved over R947mn last year and R584mn in 2023. The government reactivated the fund in 2023 — initially launched in 2008 — after four inactive years, when the administration of former president Jair Bolsonaro stopped backing new projects. The fund has released R2.7bn since 2009. The fund so far this year has directed R825mn to the Fortfisc deforestation program and R360mn to diverse projects aiming to combat and prevent deforestation. The most recent funding follows new approval standards on structuring and strategic projects. The Amazon Fund has R5.6bn under management in 133 assets, such as the Restaura Amazonia, which has been backing ecological and productive restoration projects for 16 years. Payments have also picked up in the first half this year, as it released R158mn from current approved programs to combat deforestation and boost revenue generation in traditional communities. This amount represents 75pc of last year's payments of R209mn and triple the 2023 payment of R51mn. Norway is the fund's largest donor, having pledged R3.5bn, followed by German development bank KfW with around R388mn and the US with R291mn. Other donors include the UK, Switzerland, Japan, Ireland and Denmark . Brazil is working to eliminate deforestation — both legal and illegal — by 2030, to meet its emissions reductions targets under the Paris climate agreement. Deforestation is one of Brazil's flagship issues for the UN Cop 30 summit, which it will host in northern Para state in November. By João Curi Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Countries adopt agenda at UN climate talks after delay

17/06/25

Countries adopt agenda at UN climate talks after delay

London, 17 June (Argus) — Countries have adopted the agenda of the UN Bonn climate talks after an extra day of negotiations, following disagreements over the inclusion of items on climate finance and climate-related trade measures, which caused delays. The adopted agenda was a compromise, in which the two agenda items were not included, but will be addressed in other ways. The topic of trade measures — in effect carbon border adjustment mechanisms (CBAM) — will be discussed under other relevant agenda items. For the climate finance topic, which refers to developed countries' obligations to provide climate finance to developing nations, Bonn chairs will hold consultations and report back at the UN Cop 30 climate summit, set for November. The Bonn technical negotiations — halfway-point talks before Cop conferences each year — were scheduled to begin on 16 June, but the plenary was suspended as parties failed to agree on the agenda. The outgoing Azeri Cop 29 presidency oversaw further negotiations on the agenda. In the talks' opening plenary, which re-started today, India's representative said that the country was "extremely disappointed" with developed countries' "reluctance" to discuss "legal obligations" for climate finance. India will return to the topic at Cop 30, the country's representative said — echoed by Tanzania. The EU's representative welcomed the agenda's adoption. "It is hard to remain silent when our positions and our motivations are mischaracterised by our partners. This is a multilateral process in which the views of all parties must be respected… we work here together to reach compromises to allow us to move forward", he added. Finance remains a central issue in climate negotiations. At Cop 29 last year, almost 200 countries agreed on a new goal to provide $300bn/yr in climate finance to developing nations by 2035. The Cop 29 finance outcome was significantly lower than the trillions of dollars sought by developing countries, which expressed frustration at the time. But the text also called on "all actors… to enable the scaling up of financing to developing country parties for climate action from all public and private sources to at least $1.3 trillion/yr by 2035". Consultations on a roadmap to achieve that level will take place in Bonn. The EU's CBAM was a point of contention during the Cop 28 and 29 talks, with countries such as China and Brazil raising concerns about its impact on developing countries. The European Commission expects the CBAM, when fully phased in, to capture more than half of the emissions covered by the bloc's ETS. The scheme's full implementation starts on 1 January 2026, but its impact is already starting to be felt . By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

UN Bonn climate talks delayed by agenda disagreements

17/06/25

UN Bonn climate talks delayed by agenda disagreements

Edinburgh, 17 June (Argus) — The start of UN climate talks in Bonn, Germany, has been delayed as a result of agenda disagreements over finance and trade measures. The Bonn technical negotiations — halfway-point talks before the UN Cop 30 conference in Brazil — were scheduled to begin on 16 June, but the plenary was suspended as parties failed to agree on an agenda. The opening meeting is due to restart later today. Bolivia — acting on behalf of the Like-Minded Group of Developing Countries (LMDC) negotiating group — proposed two additional items to the provisional agenda. The LMDC group also includes countries such as China, Saudi Arabia, Cuba and Vietnam. The group's first proposed agenda item seeks to add a line on the implementation of Article 9.1 of the Paris Agreement relating to the provision of climate finance to developing countries from developed nations. The EU opposed the agenda item as proposed by the LMDC, and asked for references to Article 9.2 and 9.3, which relate to the provision of finance by "other parties" and sources of finance. The LMDC rejected this counterproposal. Finance remains a central issue in climate negotiations. At Cop 29 last year, almost 200 countries agreed on a new goal to provide $300bn/yr in climate finance to developing nations by 2035. The Cop 29 finance outcome was significantly lower than the trillions of dollars sought by developing countries, which expressed frustration at the time. But the Cop 29 text also called on "all actors… to enable the scaling up of financing to developing country parties for climate action from all public and private sources to at least $1.3 trillion/yr by 2035". Consultations on a roadmap to achieve that level will take place in Bonn. The second agenda item proposed by the LMDC relates to "promoting international co-operation and addressing the concerns with climate change related trade-restrictive unilateral measures" — namely the EU's carbon border adjustment mechanism (CBAM). The CBAM was a point of contention during the Cop 28 and 29 talks, with countries such as China and Brazil raising concerns about its impact on developing countries. The mechanism aims to create a level playing field by imposing an effective carbon price on imports to the EU in sectors covered by the bloc's emissions trading system (ETS). This is to prevent EU-based firms from moving carbon-intensive production to non-EU jurisdictions with lower carbon costs, and to avoid EU products being replaced by more carbon-intensive imports. The European Commission expects the CBAM, when fully phased in, to capture more than half of the emissions covered by the bloc's ETS. The scheme's full implementation starts on 1 January 2026, but its impact is already starting to be felt . Six emissions-intensive industries are included under CBAM's scope at present — cement, fertilizers, iron and steel, aluminium, electricity and hydrogen. By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Australian safeguard credit transfers total 3mn in 1Q25

17/06/25

Australian safeguard credit transfers total 3mn in 1Q25

Sydney, 17 June (Argus) — Australia's safeguard mechanism credits (SMCs) changed hands 32 times for a combined 3mn units in the first quarter of 2025, following the first issuances early this year, the Clean Energy Regulator (CER) said. SMCs were first issued into the CER's new unit and certificate registry in January. The first transactions in the over-the-counter (OTC) market were reported by climate solutions and markets firm Core Markets in the end of February, when it claimed 190,000 SMCs sold at A$34/t CO2 equivalent ($22.24/t CO2e). Very few further transactions were reported by brokers over the rest of the quarter. The 32 transactions the CER recorded in the new unit registry may include both brokered reported trades as well as non-reported trades, it told Argus . They include any internal transfer of SMCs from one account to another, excluding surrender transactions. "This could include any transactions where a parcel of SMCs has been transacted more than once," the regulator said on 16 June in response to queries about the data. The relatively small volumes of SMC trades were in line with the CER's expectations that most entities will surrender or bank their own SMCs in the early periods of the reformed safeguard mechanism to manage future obligations, the regulator said in its quarterly carbon market report released in June. The SMCs are allowances that are issued to facilities that reduce emissions below their baselines, with each unit representing 1t of CO2e below the baseline. A total of 138 facilities out of 219 covered under the scheme surrendered 7.05mn Australian Carbon Credit Units (ACCUs) and 1.38mn SMCs for 2023-24 , up sharply from 1.22mn units of ACCUs a year earlier. Around 8.3mn SMCs were issued to 63 facilities in 2023-24. SMCs consistently traded at a discount to ACCUs in the first quarter, the CER noted. This likely reflects that the latter have alternative uses, including cancellation for voluntary purposes and corporate emissions reporting, while SMCs may only be surrendered for safeguard compliance purposes, the regulator added. Argus assessed SMC prices at A$34.95/t CO2e on 17 June, at a A$0.75/t CO2e discount to generic no avoided deforestation (No AD) ACCUs. By Juan Weik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Australia backs expanded NeoSmelt green iron group

17/06/25

Australia backs expanded NeoSmelt green iron group

Sydney, 17 June (Argus) — The Australian government has awarded domestic green iron consortium NeoSmelt — comprising five major metals and energy producers — a A$19.8mn ($13mn) grant to support its development of an electric smelter in Western Australia. The grant will support the project's A$48.8mn engineering study, Australian climate change and energy minister Chris Bowen said today. NeoSmelt will make a final investment decision on the project next year. It expects to produce 30,000-40,000 t/yr of low-carbon direct reduction iron at the plant from 2028. The consortium will initially power the site using natural gas, but may later transition to renewable hydrogen. NeoSmelt includes many of Australia's largest resource producers. Its founding members are Australian metals producers BlueScope Steel and BHP, and UK-Australian metals producer Rio Tinto. Japanese producer Mitsui and Australian energy producer Woodside Energy joined the consortium today, BlueScope chief executive for Australian steel products Tania Archibald said in a statement announcing the grant. The Australian government will also support the project through its A$14bn green hydrogen subsidy scheme , which will enable producers to claim tax credits worth A$2/t of low-carbon hydrogen produced from 2027. It is also supporting other low-carbon iron producers through its A$1bn green iron investment fund , which is designed to support early-stage projects and attract private-sector investment. By Avinash Govind Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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