Viewpoint: Australia sets basis for energy transition
Australia's energy transition is expected to broaden in 2023 with Canberra to unveil its electric vehicle (EV) strategy, set baselines for facilities with the largest greenhouse gas (GHG) emissions, as well as tighten rules on firms to ensure they are not making false claims about their emissions cuts.
These policies build on the advances made in 2022 for the country's energy transition, which will affect domestic coal and gas consumption as utilities pledged to close coal and gas base-load power plants earlier than previously planned. The federal government in May ushered in deeper GHG emissions cut targets and imposed a renewable energy target of 82pc by 2030. Most of the GHG emissions reduction initiatives are related to Australia's electricity generation sector, which is the country's largest single source of emissions and represent a third of total emissions.
The coal-fired power plant closures and the increase in renewables is projected to cut GHG emissions from electricity generation by 50pc to 79mn t of carbon dioxide equivalent (CO2) by the end of the decade from 158mn t of CO2e in 2021. The fall in power generation emissions puts Australia on track to reduce emissions by 40pc by 2030, just short of its target of a 43pc cut.
The latest Australian emissions projections show CO2 to continue to rise for the transport, agriculture and the fugitive emissions from extracting coal, oil and gas. Canberra also has its sights on transport emissions, which account for around 20pc of Australia's emissions.
Canberra has released a discussion paper on EVs, aiming to align polices at the federal and state level to stimulate EV sales. These possible new policies include setting emissions target for the light vehicle market, improving fuel standards for gasoline cars and providing financial incentives to purchase EVs. The latest national vehicle sales data for November 2022 showed EV sales accounted for 4.7pc of total sales in the month, up from an average of 0.49pc in 2021 of the 1.05mn vehicles sold in 2021.
Australian independent Santos is building a 1.7mn t/yr carbon capture and storage (CCS) unit in the onshore Cooper basin in South Australia, which it intends to capture scope one and two GHG emissions that includes fugitive emissions from the extraction process, but is reliant on carbon credits to fund the venture.
A review of Australia's carbon credit market is to be done in 2023, which may influence the construction of further CCS projects as the carbon credit market requires tighter validity rules given the scale of questionable credits in the market.
The federal government plans to reform the safeguard mechanism, which imposes emissions caps on all facilities emitting over 100,000 t/yr of CO2e, covering around 215 facilities.
Hydrogen future
Australian federal and state governments have been promoting hydrogen from renewable sources as a possible way to decarbonise heavy industry such as steel production and other industrial processes that will be subject to the safeguard mechanism. Few hydrogen projects have been sanctioned beyond the concept stage but 2023 will see the expected opening of the country's first electrolyser facility in Gladstone, Queensland by Fortescue Futures Industries (FFI).
FFI plans to use the electrolysers for the conversion of the Gibson island ammonia plant in Queensland to be run on green hydrogen, with a final investment decision to be made in 2023. This makes 2023 an important year for making inroads into reducing emissions from the industrial processes sector.
All sectors will be affected by Canberra's plans to introduce new climate risk disclosure rules for all firms to provide greater transparency, boost investor confidence particular for investment funds with environment, social and governance mandates and ensure Australia's regulations are up to date with other jurisdictions.
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India’s NTPC tests 20pc torrefied biomass co-firing
India’s NTPC tests 20pc torrefied biomass co-firing
Singapore, 13 May (Argus) — India's state-owned generator NTPC has demonstrated 20pc torrefied biomass-coal co-firing at a 110MW unit at its Tanda power plant in the northern state of Uttar Pradesh. The test was part of NTPC's efforts to expand biomass co-firing across its coal-fired fleet as it aims to lower emissions. Each percentage point of biomass co-firing has the potential to reduce carbon emissions by approximately the same percentage, while also helping in mitigating air pollution caused by direct burning of agricultural waste in farmlands, NTPC said. The generator currently conducts 7-10pc non-torrefied biomass co-firing at NTPC's Dadri power plant, near Delhi. Torrefied biomass was found suitable for higher co-firing percentages without significant system modifications, NTPC said. The torrefied biomass was produced by heating biomass in the absence of oxygen to exhibit characteristics akin to high-quality coal. The gross calorific value and cost of torrefied biomass pellets were currently equivalent to imported coal, it added. Costs could be reduced with the maturity of technology and market in the long run, NTPC said. India's push to cut coal reliance NTPC's efforts are part of India's broader goal of cutting emissions as the country aims to trim reliance on coal in the coming years and attain net zero by 2070. Delhi had initially asked Indian utilities to adopt co-firing of at least 5pc biomass pellets by October 2022. But only a fraction of utilities followed the directives, which eventually prompted the federal power ministry to review the biomass co-firing policy. The ministry amended the policy in June last year and delayed the start date of co-firing, asking all coal-based thermal power plants with bowl mills to use a minimum 5pc blend of biomass pellets made primarily from agricultural residue, with effect from the start of India's 2024-25 fiscal year on 1 April. The threshold would increase to 7pc from the start of 2025-26, the ministry said. Plants with ball and race mills should co-fire the same percentages of torrefied biomass pellets made from agricultural residue during the same time frame, it said. India has surplus biomass supplies of about 230mn t/yr, largely from agricultural residue, the power ministry previously said. NTPC tenders NTPC has awarded biomass supply contracts totalling about 5.2mn t for 20 power plants operated by NTPC, and a joint venture plant. Out of which, it has so far co-fired 316,657t of biomass pellets at 13 NTPC power plants and at the joint venture plant. The generator is setting up biomass pellet plants at various locations to ensure a steady supply of pellets for co-firing. It has set up a 22 t/d non torrefied pellet plant at Lehra Mohabbat, Bhatinda in Punjab state. It is building a 100 t/d torrefied and 100 t/d non-torrefied pellet plant at joint ventureAravali Power's Jhajjar plant. It is also building a 50 t/d non-torrefied pellet plant at the Dadri plant. By Saurabh Chaturvedi Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
APA defers FID for Australian gas pipeline's stage 3
APA defers FID for Australian gas pipeline's stage 3
Sydney, 13 May (Argus) — Australian pipeline operator APA has deferred a final investment decision (FID) for stage 3 of its planned east coast grid expansion, given potential rule changes for the South West Queensland pipeline (SWQP). APA is pushing back the FID by about 6-12 months to the first-half of 2025, and was likely initially planning to make the FID this year. The operator postponed the FID because of recent action by the Australian Energy Regulator (AER), which said it might recommend rule changes for the SWQP. A review was announced in February and is not expected to be completed until November at the earliest, APA said. The firm opposes any further regulation of the SWQP , maintaining that it does not return excessive profits. APA said the lack of a single arbitration case involving the facility since such a regime was instituted in 2017 is evidence that its customers accept present arrangements. "We've probably got around six to 12 months at the very most for us to work through and hopefully there's no change to regulation, but basically the time frame is we need to get started pretty much early next year on building stage 3," APA's chief executive Adam Watson said on 9 May. If the AER decides to make the lightly regulated SWQP subject to reference price regulation, an access arrangement would need to be determined which will take 2-3 years to complete, APA said. This means any changes would be instituted in the fiscal year to 30 June 2028. The SWQP can carry 440 TJ/d (11.75mn m³/d) in a westerly direction from Wallumbilla to the Moomba hub, from where gas can enter the APA-operated Moomba-Sydney and Epic Energy-owned Moomba-Adelaide pipelines for transport to southeastern facilities. Expanding the capacity of pipelines allowing the north-south transit of gas is considered critical to avoiding shortfalls owing to the depletion of Gippsland basin fields this decade. Stage 1 of APA's east coast grid expansion was completed in 2023, with stage 2 also now operational in line with guidance. These two stages increased capacity by 25pc, allowing about 50 TJ/d more gas to flow on the SWQP to southern markets, with similar increased volumes expected from stages 3 and 4. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan’s Idemitsu invests in US e-methanol producer HIF
Japan’s Idemitsu invests in US e-methanol producer HIF
Osaka, 13 May (Argus) — Japanese refiner Idemitsu is investing in US synthetic fuel (e-fuel) producer HIF Global to develop a supply chain of e-methanol, as part of a strategy to achieve net zero emissions by 2050. Idemitsu said on 13 May that it has agreed to spend $114mn to secure an undisclosed stake in HIF after the US firm issued new shares. HIF is expected to produce around 4mn t/yr of e-methanol equivalent by 2030 at its production sites in Australia, North America and South America. E-methanol is typically made from green hydrogen and carbon dioxide (CO2). This is used as an alternative bunker fuel and as a feedstock for synthetic fuels, including gasoline, sustainable aviation fuel (SAF) and diesel, as well as synthetic chemicals. Idemitsu is focusing on e-methanol, along with blue ammonia and SAF, as its investment targets to achieve net zero by 2050. The company aims to set up 500,000 t/yr of e-methanol supplies in domestic and overseas markets in 2035 by using its existing oil supply and sales networks. The target includes unspecified volumes from HIF, possible production in the Middle East and domestic output, Idemitsu said. The deal follows Idemitsu's initial agreement with HIF in March 2023 to work on production and promotion of e-fuels, along with a decision to buy e-methanol from HIF and jointly study the possible development of the fuel. Idemitsu also agreed an initial deal with HIF and Japanese shipping firm Mitsui OSK Line to explore opportunities to develop an e-fuel and e-methanol supply chain between Japan and where HIF's e-fuel and e-methanol production plants are located, including CO2 transportation from Japan to HIF's production sites. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
China, US pledge joint methane action at climate talks
China, US pledge joint methane action at climate talks
San Francisco, 13 May (Argus) — The US and China have pledged to further co-operate on methane reduction, among other topics, following a first meeting between the countries' new climate envoys in Washington during 8-9 May. The meeting follows video conferencing between the two sides in January under their "working group on enhancing climate action in the 2020s" initiative. China and the US reaffirmed their 2021 agreement to co-operate on reducing carbon emissions in the power generation sector, cutting methane emissions and boosting renewable energy in the " Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis " last November in San Francisco. China confirmed the appointment of Liu Zhenmin to replace Xie Zhenhua as the country's climate advsior in January. Liu's US counterpart John Podesta replaced John Kerry in January. Liu and Podesta discussed co-operation "on multilateral issues related to promoting a successful COP 29 in Baku, Azerbaijan" at the latest talks, the US state department said on 10 May. They also discussed issues identified in the Sunnylands statement, including energy transition, methane and other non-CO2 greenhouse gases, the circular economy and resource efficiency, deforestation,as well as low-carbon and sustainable provinces, states and cities. They plan to co-host a second event on reducing methane and other non-CO2 greenhouse gases in Baku and "conduct capacity building on deploying abatement technologies". It remains to be seen how the two new climate advisors will bring the two countries closer in climate negotiations. The Sunnylands statement and the close relationship of their predecessors were instrumental in bringing consensus at last year's Cop 28 UN climate summit in Dubai. China released a much anticipated methane plan last November, although Xie has flagged challenges with data monitoring in the sector. But China and the US have agreed to develop and improve monitoring to "achieve significant methane emissions control and reductions in the 2020s". China has also not signed on to the Global Methane Pledge to cut methane emissions by 30pc by 2030, from 2020 levels. The country's emissions may also rise more than expected after it redefined its meaning of energy intensity, according to the Helsinki-based Centre for Research on Energy and Clean Air. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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