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EU agrees negotiating mandate for Cop 29

Brussels, 15 October (Argus) — EU ministers have agreed a general negotiating mandate for the UN Cop 29 climate conference, calling for a new climate finance goal, but without mentioning a concrete amount or range of figures for this. The main point of the EU's mandate remains that of obtaining an "ambitious and balanced" agreement at Cop 29, to be held on 11-22 November in Baku, Azerbaijan. The deal should still hold out hope of maintaining global temperatures within 1.5°C of pre-industrial levels in the "light of the best available science", according to the EU position. The bloc's environment and climate ministers want a Baku text to move "us all forward towards long-term resilience". The text sticks to language in a previous draft , underlining the need for "transitioning away from fossil fuels", tripling renewable energy capacity, and doubling annual energy efficiency gains by 2030 — all points agreed at last year's Cop 28. Countries, and especially major economies, should significantly enhance their national climate plans — known as nationally determined contributions (NDCs) — with greenhouse gas (GHG) emissions peaking before 2025, EU ministers said. NDCs should contain "economy wide absolute emission reduction targets" for all GHGs, they added. The EU will push for a global approach to carbon pricing. The bloc will "encourage" all jurisdictions to introduce or improve their own domestic carbon pricing mechanisms. And ministers stressed the need to "explore" innovative options for widening the sources of climate finance, including "carbon pricing, levies for implementing climate action" and the "scaling down of harmful incentives". That mirrors language in EU finance ministers' conclusions on international climate finance . Finance will be the key topic at Cop 29, where countries must finalise the details of a new climate finance goal . Funding needs for this are "in the space of… trillions" of dollars, Azerbaijan's lead negotiator Yalchin Rafiyev said this week. But a "realistic goal for what the public sector could directly provide and mobilise seems to be in the hundreds of billions", he said. The Cop 29 presidency hosted a series of 'pre-Cop' meetings on 8-12 October, including ministerial dialogues. Some progress was made, the presidency said. Ministers "must now return to their capitals to secure the mandates they need for the breakthroughs they must deliver. There is no excuse for anyone to arrive at Cop 29 without clear political support to make progress", incoming Cop 29 president Mukhtar Babayev said this week. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan's 2MW Susono biomass plant starts construction

Japan's 2MW Susono biomass plant starts construction

Tokyo, 15 October (Argus) — Japan's 2MW Susono biomass-fired power plant in Shizuoka prefecture has started construction today, with the aim to begin commercial operations in October 2025. The Susono plant will burn 27,000 t/yr of wood chips secured in Shizuoka to generate around 15 GWh/yr of electricity. Operating company Susono Biomass Power is held 50pc by Japanese utility Chubu Electric Power, 40pc by energy company ML Power, which is a subsidiary of financing firm Mizuho Leasing, and 10pc by renewable energy developer Prospec AZ. Those companies plan to build three other biomass-fired power plants in Gunma, Nagano, and Niigata prefectures. Each plant is expected to come on line in November 2025, April 2026, and May 2027. The three 2MW plants will burn 27,000-29,000 t/yr of locally gathered wood chips to generate around 15 GWh/yr. Chubu has invested in a number of biomass-fired power plants, including the 112MW Tahara in Aichi prefecture , which is currently under construction and aims to start commercial operations in September 2025. By Takeshi Maeda Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Chinese steel investment needs to avoid lock in: CBI

Chinese steel investment needs to avoid lock in: CBI

Singapore, 15 October (Argus) — Chinese investment in steel assets needs to be aligned with a Paris-compatible scenario to avoid locking in emissions and stranded assets, according to a report by non-profit Climate Bonds Initiative (CBI). Almost 80pc or 730.8mn t/yr of China's existing coal-based blast furnace capacity will need to be retired or require reinvestment by 2030, CBI said in its report released last week. Steel asset lifetimes often exceed 40 years, so "investment decisions made today can lock in billions of tons of emissions and potentially billions of dollars in stranded assets", CBI added. Steel production currently accounts for around 8pc of global CO2 emissions, and almost 50pc of global steel output is from China, CBI said. China's steel sector is estimated to require at least 1.6 trillion yuan ($226bn) in fixed asset investment for decarbonisation by 2050, according to a joint report by CBI and US-based Rocky Mountain Institute (RMI) earlier this year. Of the Yn1.6 trillion, 33pc should go to energy efficiency, 23pc for electric arc furnaces, 18pc for direct iron reduction (DRI), 14pc for carbon capture, utilisation and storage (CCUS), 7pc for blast furnace hydrogen injection, and 5pc for pellet manufacturing. Green bonds Steel companies can obtain financing through labelled green bonds from various categories at the project level, including energy efficiency, heat recycling, waste and resource recycle, green hydrogen, biomass, and CCUS. A total of Yn4.46 trillion of labelled green bonds had originated from China in domestic and overseas markets as of the end of 2023, according to CBI. But Chinese steel firms had only issued 23 green bonds totalling Yn3.5bn and six sustainability-linked bonds totalling Yn1.6bn by the end of last year, representing 0.1pc of the total Chinese labelled bond market. This Yn5.1bn falls very short of the estimated Yn1.6 trillion needed to decarbonise the Chinese steel sector. CBI asserts that the labelled bond and loan market can supply the required capital, but issuers operating in the steel sector must be encouraged to price deals with the recommended transparency and credibility. Recommendations Several Chinese provinces have already issued provincial-level transition finance guidance, including major steel-producing Hebei province this year. But China's national-level transition finance guidance remains under development. CBI thus recommends that the national transition taxonomy further align provincial guidelines and "enhance interoperability" between Chinese and international transition taxonomies, incentivise low-carbon production methods, customise financing for small-to-medium companies, and enhance entity-level transition plans. CBI also suggests that banks incentivise companies to enhance the quality of their information disclosure and integrate such incentives into their transition frameworks. The non-profit also urged steel companies to issue credible transition plans, which should include Paris-aligned emission-reduction targets and clear capital expenditure plans. Lastly, CBI notes that policies should support hydrogen infrastructure and supply chain development to accelerate green hydrogen deployment for high-emitting sectors. This is especially as current financing to decarbonise heavy industrial sectors have mainly been for mature technologies, such as raising energy efficiency. But green hydrogen can reduce over 90pc of steel production emissions, and steady development in hydrogen infrastructure and supply chain will cut costs and accelerate the steel transition. CBI also flagged public sector steel procurement as an avenue through which the country can boost demand for green steel, especially since Chinese public authorities buy about 350mn t/yr of steel, which causes around 689mn t/yr of CO2 emissions. Green public procurement (GPP) policies in China would also have a global impact, with steel public procurement demand in China three times that of India's total steel demand of 100mn t/yr. CDI suggests that the Chinese government accelerate adopting national-level standards to ensure consistent embodied emissions reporting, as GPP policies will only be effective when implemented with standardised methodologies. By Tng Yong Li Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

China's Hubei releases hydrogen development draft plan

China's Hubei releases hydrogen development draft plan

Mumbai, 14 October (Argus) — China's Hubei province has released a draft plan to accelerate development of its hydrogen industry by 2027, and is seeking industry feedback. The province seeks to double the scale of its hydrogen industry by that time, with a target output value of 100bn yuan ($13.7bn), according to the draft. The plan aims to promote technological breakthroughs, enhance industrial and supply chains and build a hydrogen storage and transportation network. It envisions the city of Wuhan as the core of Hubei's hydrogen industry, and it aims to establish a national hydrogen equipment centre focused on electrolysers and fuel cells. It promotes renewable hydrogen technologies, such as biomass-based hydrogen production. Hubei plans to explore pilot projects for hydrogen-blended pipelines and pure hydrogen pipelines, while prioritising construction of hydrogen refuelling stations. For transportation-related hydrogen projects, the province will provide subsidies covering up to 20pc of equipment costs, with a maximum of Yn10mn per project. The province already has 100 hydrogen refuelling stations and hydrogen production capacity of 1.5mn t/yr, according to the draft, although the vast majority, if not all, of this will be from fossil fuels with unabated emissions. To support innovation, the province offers a one-time subsidy of Yn10mn for hydrogen-related technology centres and Yn5mn for national labs and research centres. Additionally, it plans to establish a provincial hydrogen energy innovation project database, focusing on technologies like solid-state hydrogen storage and solid oxide fuel cells. For major projects, a subsidy of up to 10pc of investment is offered, capped at Yn5mn per project. The plan does not specify what counts as a major project. The province will also support key manufacturers of fuel cell components and promote fuel cell use in vehicles, ships, and power stations, according to the draft. Hubei plans to establish a provincial hydrogen energy industry alliance and encourage stakeholders to participate in setting industry standards. By Akansha Victor Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

India industries confident of 2030 renewable energy aim