Deforestation in Brazil's Amazon plunges 31pc

: Emissions
24/11/07

Deforestation in Brazil's Amazon biome plunged by around 31pc over the 12 months ending in July — the sharpest decline in over 15 years — bringing the country closer to meeting its target of eliminating deforestation in the region by 2030.

Brazil lost 6,288km² (2,404mi²) of Amazon rainforest from August 2023-July 2024, a 31pc decline from 9,064km² in August 2022-July 2023, according to the science and technology ministry's national space institute INPE. The fall in deforestation marks the third consecutive decline in deforestation in the Amazon, after devastation in the region reached a multi-year high of 13,038km² in 2020-21.

With the decline, deforestation in the biome reached its lowest level since 2015, when the region recorded losses of 6,207km².

Deforestation fell steeply in all of the largest states in the legally defined Amazon region — known as Legal Amazon — except for Roraima, according to data compiled by the Amazon deforestation satellite monitoring system (Prodes).

The Legal Amazon contains the nine states in the Amazon basin: Acre, Amapa, Amazonas, Para, Rondonia, Roraima and Tocantins, as well as most of Mato Grosso and Maranhao states. It contains all of Brazil's Amazon biome, 37pc of the cerrado tropical savanna biome and 40pc of the pantanal biome.

Para state continued to lead in deforestation with 2,362km², accounting for 37.5pc of total deforestation in the biome. But this year's figure was 28pc lower than the 3,299km² in the prior period.

Amazonas state posted the second largest deforestation in the period, with losses reaching 1,143km², accounting for 18pc of the total area of forest lost. Deforestation there fell by 29pc in the 2023-24 cycle from a year earlier.

Mato Grosso, Brazil's largest grain-producing state, cut 1,124km² of forests, down by 45pc from the 2,048km² in the previous cycle.

The government attributed the decline to increased oversight in the region, with the number of fines issued for illegal deforestation nearly doubling from 1 January 2023 — when president Luiz Inacio Lula da Silva took office — and October this year, compared with the period between January 2019-December 2022.

The government also highlighted that deforestation was down in 78pc of the 70 municipalities that were declared priority regions by the administration earlier this year. The government announced R730mn ($129mn) in funding to reduce environmental devastation in these municipalities in April.

The government also reduced deforestation in the cerrado by nearly 26pc to 8,174km² in the period. That is the lowest level since 2019 and the first time deforestation in the biome has declined in four years.

With the reduction in deforestation, Brazil's 2023 emissions fell by 12pc to 2.3bn tons of CO2 equivalent (t CO2e) from 2.6bn t CO2e in 2022, according to Brazilian climate think tank Observatorio do Clima.

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24/12/06

Republicans weigh two-step plan on energy, taxes

Washington, 6 December (Argus) — Republicans in the US Congress are considering trying to pass president-elect Donald Trump's legislative agenda by voting first on a filibuster-proof budget package that revises energy policy, then taking up a separate tax cut bill later in 2025. The two-part strategy, floated by incoming US Senate majority leader John Thune (R-South Dakota), could deliver Trump an early win by putting immigration, border security and energy policy changes into a single budget bill that could pass early next year without Democratic support. Republicans would then have more time to debate a separate — and likely more complex — budget package that would focus on extending a tax package expected to cost more than $4 trillion over 10 years. The legislative strategy is a "possibility" floated among Senate Republicans for achieving Trump's legislative goals on "energy dominance," the border, national security and extending tax cuts, Thune said in an interview with Fox News this week. Thune said he was still having conversations with House Republicans and Trump's team on what strategy to pursue. Republicans plan to use a process called budget reconciliation to advance most of Trump's legislative goals, which would avoid a Democratic filibuster but restrict the scope of policy changes to those that directly affect the budget. But some Republicans worry the potential two-part strategy could fracture the caucus and cause some key policies getting dropped, spurring a debate among Republicans over how to move forward. "We have a menu of options in front of us," US House speaker Mike Johnson (R-Louisiana) said this week in an interview with Fox News. "Leader Thune and I were talking as recently as within the last hour about the priority of how we do it and in what sequence." Republicans have yet to decide what changes they will make to the Inflation Reduction Act, which includes hundreds of billions of dollars of tax credits for wind, solar, electric vehicles, battery manufacturing, carbon capture and clean hydrogen. A group of 18 House Republicans in August said they opposed a "full repeal" of the 2022 law. Republicans next year will start with only a 220-215 majority in the House, which will then drop to 217-215 once two Republicans join the Trump administration and representative Matt Gaetz (R-Florida) resigns. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Treasury eyes 45Z guidance before Biden exit

24/12/03

Treasury eyes 45Z guidance before Biden exit

New York, 3 December (Argus) — The US Department of Treasury said it still plans to issue guidance before president Joe Biden leaves office next year clarifying how refiners can qualify for a new tax credit for clean fuels. The agency "anticipates issuing guidance" around the Inflation Reduction Act's 45Z credit before 20 January to "enable producers to claim the 45Z credit for 2025", disputing a report today that the Biden administration planned on punting implementation to president-elect Donald Trump. The credit, set to kick off regardless on 1 January, will differ from some prior federal incentives by offering greater subsidies to fuels that produce fewer greenhouse gas emissions. Treasury did not commit to any definitive timeline for releasing guidance, and it did not immediately clarify how thorough any eventual rule would be. Companies in the biofuel supply chain say the current lack of clarity from Treasury — particularly on how it will calculate carbon intensities for various fuels and feedstocks — has slowed first quarter dealmaking. Government guidance could make or break the economics of certain plants, particularly for relatively higher-carbon fuels like soy biodiesel or jet fuel derived from corn ethanol. The US Department of Agriculture's timing for releasing a complementary rule to quantify the climate benefits of certain agricultural practices, envisioned as a way to reward refineries sourcing feedstocks from farms taking steps to reduce their emissions, is unclear. The agency said today that a "rulemaking process" in response to its request for information on climate-smart farm practices is "under consideration" but did not elaborate. Agriculture secretary Tom Vilsack had insisted earlier this year that his department would release some package before the end of Biden's term. Some industry groups remain pessimistic that the Biden administration will answer all of the thorny questions still lingering around the 45Z credit, especially given signals earlier this year that other Inflation Reduction Act programs would take priority. The Renewable Fuels Association, which represents ethanol producers, says final regulations around 45Z "seem highly unlikely" before the end of Biden's term but that it hopes Treasury releases at least some "basic information" or safe harbor provisions. Delays getting credit guidance could prod Congress to extend expiring biofuel incentives for another year, including a $1/USG credit for blenders of biomass-based diesel. Some formerly skeptical lobbying groups have recently come on board in support of an extension, fearing that biofuel production could slump next year given the lack of 45Z guidance and uncertainty about how Trump will implement clean energy tax credits. But four lobbyists speaking on background told Argus today that the proposal still faces long odds. Congress has various other priorities for its relatively brief lame duck session, including government funding and disaster aid, that take precedence over biofuels. A staffer with the Democratic-controlled US Senate Finance Committee said last month that Republicans have been reluctant to negotiate tax policy in a divided Congress this year when they are planning a far-reaching tax package under unified Republican control next year. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Africa attempts to surmount clean cooking obstacles

24/12/03

Africa attempts to surmount clean cooking obstacles

Financial backing and carbon credits could be vital for making LPG more affordable as a clean cooking fuel, writes Elaine Mills Cape Town, 3 December (Argus) — Sub-Saharan Africa still has many of the same intractable challenges to overcome if it is to come close to achieving universal clean cooking access, delegates heard at LPG Week in Cape Town, South Africa. But government support, public-private collaboration, grassroots movements and carbon credits could pry open markets. The IEA is spearheading momentum behind the drive to clean cooking adoption in sub-Saharan Africa, expecting 45pc of the transition to be to LPG. A global transition would result in a net reduction of 1.5bn t of CO2 equivalent by 2030, of which sub-Saharan Africa alone would account for 900mn t, it says. "We can't imagine a more important global initiative in terms of our objectives of development, poverty alleviation, health and prosperity," the IEA's head of sustainable transitions, Daniel Wetzel, said during the World Liquid Gas Association event. Sub-Saharan Africa consumes less than 4kg/capita of LPG per year, according to South Africa's Department of Mineral and Petroleum Resources. This compares with north Africa's 35kg/yr, including Morocco, which has the highest in the world at 73kg/yr, Argus Consulting data show. The IEA estimates Africa requires investment of $4bn/yr to facilitate clean cooking. The continuing challenge for LPG penetration in southern Africa is "affordability, availability and acceptability", the International Finance Corporation's (IFC's) regional industry manager for manufacturing, Bambo Kunle-Salami, said. An average household needs to spend about $300-400/yr on LPG, while GDP per capita is just over $1,000/yr, he said. Government backing is essential, as "no LPG has grown on its own organically or reached desired levels [without] government intervention", the UN-backed Global LPG Partnership's East Africa director, Elizabeth Muchiri, said. Subsidies can solve cost barriers but many African governments cannot afford them, Kunle-Salami said. It might also encourage cross-border smuggling, so if used they must be targeted to low-income homes with a clear end goal, he said. Some countries have struggled to scale back their LPG subsidies, Wetzel said. But the IEA expects LPG prices to drop sharply later this decade as global demand peaks, allowing markets to reduce subsidies and emerging markets to expand. Kenya has distributed subsidised cylinders to low-income homes, scrapped LPG taxes and introduced mandates on new homes to include LPG infrastructure, Muchiri said. Some banks and retailers have offered microfinancing and pay-as-you-go smart meters on cylinders, she said. Ghana has also provided free cylinders and stoves to those most in need, its National Petroleum Authority director Akua Kwakye said. A cylinder recirculation model was introduced so consumers do not own the cylinders, which improves safety and reduces costs, she said. Logistics and their cost impact are a significant problem in Africa, Kunle-Salami said. "In a healthy market [logistics costs] should be 10-20pc, but in many African countries it is as high as 40-50pc," he said. A lack of storage infrastructure to protect from supply shocks is another issue. This requires significant investment that needs private-public collaboration, Wetzel said. But centralised solutions can only go so far — only grassroots initiatives create trust and acceptance, he added. Credits where they're due The IEA thinks carbon credits have huge potential in making LPG more affordable as a clean cooking fuel owing to the emissions savings and certainty of the verification. Such schemes might yield higher-quality credits than many other carbon-offsetting projects, Wetzel said. Many of the firms IFC finances struggle to understand, let alone access, the carbon market, Kunle-Salami said. But agreements on Article 6 at the UN's Cop 29 climate summit on establishing a global carbon market, and inclusion of clean cooking at the G7 and G20 summits, provide more hope such credits can become important, delegates heard. Nigeria LPG residential demand. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Brazil eyes Cbios, CGOBs integration

24/12/02

Brazil eyes Cbios, CGOBs integration

Sao Paulo, 2 December (Argus) — Brazil is considering integrating its biomethane certificate of guarantee of origin (CGOB) to Cbio decarbonization credits, as biomethane plants will be eligible to generate both. The fuel of the future bill's approval established a mandatory biomethane blend into natural gas pipelines, which can be fulfilled either with the physical molecule or by buying the newly proposed CGOBs. As a result, natural gas producers and importers will have to reduce greenhouse gas (GHG) emissions by 1pc in 2026 through the mandate that starts at 1pc and may increase to up to 10pc in subsequent years. Oil and gas regulator ANP is now leading regulatory discussions on the law. As biomethane producers are eligible to issue Cbios once authorized under the biofuels carbon credit Renovabio program — also mandatory in Brazil but aimed at motor fuel distributors — there are discussions on how to prevent double counting. Brazilian biogas producers association Abiogas points out that Cbios and CGOBs represent different concepts: the first acts as a carbon credit, while the latter is a guarantee of origin, so there is no risk of double counting. Additionally, Cbios are not used in companies' GHG emissions reports. "This would not be any different from what happens in the US," Abiogas' president Renata Isfer said. "The low-carbon fuel standard, which is similar to Cbios, is not counted in the inventories, while the US Renewable Fuel Standard, like the CGOB, is." Abiogas said there could be transparency to consumers, so they can opt to buy CGOBs from plants that do not issue Cbios if that concerns them. Critics worry this can lead to double counting and less international acceptability. The market is also debating whether this certificate will need to be retired to satisfy mandatory buying, as is the case with Cbios, or if buyers will be able to resell CGOBs after purchasing them. Participants again worry this might lead to double counting, as producers and importers would be reselling a credit that has been accounted for in the voluntary market. "Motor fuels distributors will want to do the same with Cbios," a market participant said. ANP will also have to define biomethane volumes necessary for the target, determine which gas producers and importers are big enough to be a part of the compulsory market and specify how much biomethane a CGOB will represent. By Rebecca Gompertz Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Denmark pledges DKr150mn to Brazil's Amazon fund

24/11/29

Denmark pledges DKr150mn to Brazil's Amazon fund

Sao Paulo, 29 November (Argus) — Denmark will donate 150mn Danish kroner ($21.3mn) to Brazil's Amazon fund, adding the Nordic country to a growing list of nations supporting the South American country's efforts to preserve the Amazon forest. The Amazon fund issues grants to projects that prevent, monitor and combat deforestation while promoting conservation and sustainable development in the Amazon. The fund was created in 2008 and is managed by Brazil's Bndes development bank. It has R4.5bn ($750mn) under management and has supported 114 projects to date. Norway is the fund's largest donor, having pledged R3.5bn, followed by German development bank KfW with R388mn and the US with R291mn. Other donors include the UK, Switzerland and Japan. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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