Low Carbon Pulse Edition 29
01 November 2021
01 November 2021
Please click here for Edition 28 of Low Carbon Pulse, and click here for the Anniversary Edition of Low Carbon Pulse, which reflected on the 12 months since the publication of Edition 1 on October 6, 2020, and looking forward to the next 12 months. Click here and here for the sibling publications of Low Carbon Pulse, the Shift to Hydrogen (S2H2): Elemental Change series and here for the first feature in the Hydrogen for Industry (H24I) features.
After the weeks beginning September 20, 2021 (in New York), and September 27, 2021 (in Milan), the great and the good continued to prepare for the 26th session of the Conference of Parties (COP-26) of the United Nations Framework Convention on Climate Change opening this coming Sunday, October 31, in Glasgow, Scotland. The great and the good have been gathering in Glasgow for the last few days, and en route many of the great and good have been making announcements and caucusing.
As US Special Climate Change Envoy, Mr John Kerry, said in Milan: "The bottom line is, folks, as we stand here today, we believe we can make enormous progress in Glasgow, moving rapidly towards new goals that science is telling us we can achieve".
President of COP-26, Mr Alok Sharma, set out the UK Government Goals for COP-26, the fourth of those Goals including the finalisation of the Paris Rulebook. Mr Sharma has been quoted as saying that reaching agreement of the Paris Rulebook will be more difficult that achieving agreement of the Paris Agreement.
One senses that Mr Sharma is right, and yet just because something is difficult does not mean that it is not pursued. Third time lucky with the Paris Rulebook!
During this week-beginning October 25, 2021, five Low Carbon Pulse – COP-26 Countdown features were published covering the four key goals outlined for COP-26 by the UK Government as the host of COP-26 (the Four Pillars).
This Edition 29 of Low Carbon Pulse does not repeat the Four Pillars or the subject matter of them.
It is a little over 30 years since the United Nations Intergovernmental Panel on Climate Change (IPCC) released its First Assessment Report in 1990. In a little over 30 years, the mass of GHGs present in the climate system has doubled. Among other things, this increase in GHG emissions reflects increasing population, prosperity and urbanisation.
The bottom line is that by 2030, GHG emissions need to be reduced by 45% (at least) to ensure that average increases in global temperatures stay within the bottom end of the responsible range between the Stretch Goal and the Stabilisation Goal i.e., between 1.5OC to 2OC (Responsible Range), and a reduction of 50% is required to achieve the Stretch Goal. This analysis is drawn from the UNFCCC NDC Synthesis Report which synthesises information from the 164 latest nationally determined contributions (NDCs) communicated by the 191 Parties to the Paris Agreement as at July 30, 2021. While it is known that GHG emissions must be reduced, GHG emissions are projected to increase. It is the Synthesis Report that projects the Catastrophic Pathway.
In the week leading up to COP-26, the Commitment and Production Gap has probably received more concerned coverage in news feeds and opinion pieces than any other matter.
The United Nations Environment Programme (UNEP) publishes a production gap report annually. On October 20, 2021, the UNEP published the 2021 Production Gap Report (PGR) annually. Each production gap report assesses the gap between NDCs and the planned and projected fossil fuel production. The authors of the PGR note that as countries have made NZE commitments and increased their NDCs, they, "… have not explicitly recognised or planned for the rapid reduction in fossil fuel production that these targets will require".
The PGR notes that given current plans and projections, by 2030, the production of fossil fuels will exceed levels that are consistent with achieving the Stretch Goal; by 240% more in the case of coal, by 57% more in the case of oil and by 71% more in the case of natural gas. The "policy setting hand" and the practical, real world hand, are not coordinated. As a result, there is a gap.
If the gap is not bridged or narrowed, it is expected that the current bottom line (as projected) will result in at least a 16% increase in GHG emissions by 2030. This is not consistent with the Stretch Goal, rather it aligned with what United Nations Secretary General, Mr Antonio Guterres has termed a Catastrophic Pathway.
United Nations Secretary General, Mr Antonio Guterres, pulled no punches in his address to the United Nations General Assembly in September. Mr Guterres expressed extreme concern, critically, that the world is on a catastrophic pathway to a 2.7OC increase in average global temperatures compared to pre-industrial times (Catastrophic Pathway) without significant and immediate increases in the rate of GHG emission reductions. As is readily apparent from the science based reports: greater GHG emission reductions are needed, and the rate of those reductions needs to increase. No matter the direction from which discussion is approached, the discussion needs to coalesce around "greater and faster reductions".
The First Pillar (of the Four Pillars) for COP-26 contemplates staying within the Responsible Range, while "keeping in touch" with the Stretch Goal.
Earlier in 2021, Mr Thomas Bach, President of the Olympic Committee, suggested the addition of the word "Together" to the Olympic motto, Faster, Higher, Stronger. The rate of reduction in, and the rate of removal of, GHG emissions need to be faster and higher, and the commitments stronger.
More than this, Article 2.2 of the Paris Agreement provides: "This Agreement will be implemented to reflect equity and the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances".
Increased GHG reduction commitments (through increased NDCs) will bridge or narrow the gap in concept, but equally important as NDCs is the use of an accepted and common monitoring and reporting framework in compliance with which reductions in GHG emissions will be monitored, and, through that monitoring, measurement, and those determinations, GHG emission will be verified.
This will be achieved by the bolstering of the 2018 Paris Rulebook (developed but not finalised at COP-24 in Katowice, Poland, and COP-25 in Madrid, Spain) with the bolstered Rulebook being the Paris / Glasgow Rulebook. The 2018 Paris Rulebook was agreed in part in December 2018 at COP-24, and provides guidelines for countries to achieve the outcomes provided for under the Paris Agreement. Given that the 2018 Paris Rulebook was agreed in part, it is incomplete, critically around key elements of accounting and accountability for NDCs.
As has been noted by many commentators, because the Paris Agreement is a bottom-up agreement, Parties to the Paris Agreement set their own targets (i.e., their NDCs), set policies as the means of achieving those targets, set the standards used to account for them, and as such to monitor and to report on their achievement. Ideally, the Paris Rulebook will provided for standardisation.
For the author, while not headline grabbing, progress on the Paris Rulebook is the the most pressing outcome in achieving progress to NZE, along with increased NDCs and commitments to development and deployment of renewable electrical energy, critically, to monitor achievement to respond to circumstances in which progress is not being made, and to verify what progress has been made.
At the moment, the 2018 Paris Rulebook does not require countries to narrow or to bridge the gap between projected fossil fuel use and their NDCs. It is possible to see some folk seeking to "paper over the gap" by use of International Market Mechanisms under Article 6 of the Paris Agreement. Papering over a crack is not advisable. Papering over a gap, even less so.
One of the most debated areas, if not the most debated area, is the use of carbon credits (and cross-border emissions trading), including to bridge or to narrow the gap. This debate appears set to take centre stage.
The point of reference for the author continues to be the IPCC Sixth Assessment Report – Climate Change, The Physical Science Basis (2021 Report). It is understood that the 2021 Report is in the Final Government Distribution phase, a phase that is to end on November 26, 2021, being a date after COP-26 finishes.
During the weeks leading up to COP-26, a number of news outlets reported on "leaks" of correspondence arising from the consultation process as part of the Final Government Distribution phase. While the author has not seen any of the correspondence, given the nature of the Final Government Distribution phase, the author does not read too much into the reported correspondence: the science will not change; how to achieve NZE is the subject of debate, validly so.
By mid-February 2022, the Summary for Policymakers will be pretty much finalised. (The 2021 Report comprised a Summary of Policymakers in draft – see Edition 24 of Low Carbon Pulse.)
The 2021 Report continues to be the oracle, providing the range of outcomes from which COP-26 has to choose.
While frequent readers of Low Carbon Pulse will be familiar with the key provisions of the Paris Agreement, for convenience they are set out below:
|KEY PROVISIONS OF THE PARIS AGREEMENT FOR COP-26|
This Agreement … aims to strengthen the global response to the threat of climate change … including by:
In order to achieve the long-term temperature goal set in Article 2, Parties aim to reach global peaking of greenhouse gas emissions as soon as possible, … and to undertake rapid reductions thereafter in accordance with best available science, so as to achieve a balance between anthropogenic emissions by sources and removals to sinks in greenhouse gas in the second half of this century … .
1. Parties recognise that some Parties choose to pursue voluntary cooperation in the implementation of their nationally determined contributions to allow for higher ambition in their mitigation and adaptation actions and to promote sustainable development and environmental integrity.
2. Parties shall, where engaging on a voluntary basis … promote sustainable development, and ensure … integrity and transparency … and shall apply robust accounting … to ensure .. avoidance of double counting consistent with guidance adopted by the Conference of Parties … .
As noted above, during this week beginning October 25, 2021, Low Carbon Pulse – published five COP-26 Countdown features dealing with the four key goals outlined for COP-26 by the UK Government as the host of COP-26 (the Four Pillars).
The Four Pillars are as follows:
It follows from the Four Pillars, and related matters the agenda items at or towards the top of folks' lists are likely to be:
NDCs and Paris Rulebook:
Commitments to NDCs, or commitments to increased NDCs, accompanied by the Paris Rulebook to provide a clear, monitorable and verifiable pathway towards NZE, are key to the success of COP-26. Progress on these matters will be a clear indication of the success of COP-26.
Commitments to, or commitments to increased NDCs, represent the first step for some countries, and longer strides for others. To avoid miscalculation of progress to achieving NDCs and NZE, the Paris Rulebook is needed, both to monitor (and to provide the basis for measurement and determination) and to verify reductions in GHG emissions, and to achieve efficient deployment of technologies and initiatives on a basis that recognises and responds to any non-achievement of GHG emission reduction commitments.
Also the Paris Rulebook is needed to provide a clear basis to monitor and to verify the use of carbon credits to offset compliance or mandatory obligations or to allow corporations to use carbon credits to manage their progress towards NZE.
Defined commitments to the development of: (i) Carbon Capture and Storage (CCS), and Carbon Capture Use and Storage (CCUS) including to allow the development of Blue Hydrogen production capacity are needed; and, (ii) renewable electrical energy capacity, solar and wind (off-shore and on-shore), to develop sufficient renewable electrical energy to allow the production of Green Hydrogen as soon as practicable, is needed. (See Editions 26 and 27 of Low Carbon Pulse, including under Government needed to guide to achieve timely development.)
The ever declining cost of photovoltaic solar electrical energy may be regarded as a function of markets working at their best, and critically, to lower the cost of producers of equipment, supplying domestic and international markets, allowing the deployment of photovoltaic solar at a scale that results in the lowest electrical energy costs in history, and the increasing development of battery electric storage systems (BESSs). Click here for a graphic entitled Electricity from Renewable Energy Sources is Now Cheaper than Ever.
In some markets, these outcomes have been achieved before use of photovoltaic solar has been incentivized.
As a result of these dynamics, the Levelized Cost of Energy (LCOE) for photovoltaic solar electrical energy has become the lowest of any source of electrical energy in many markets.
From COP-26, it is hoped that developing countries, including those in Africa, East Asia, South East Asia and the Pacific Islands, will emerge with funding support programs to maximise deployment of photovoltaic solar development, both roof-top and utility. Further, it is hoped that President Xi Jinping's proposal for a global high voltage direct current (HVDC) renewable energy network receives the "air-play" that it deserves.
It is clear that a number of countries and organisations attending COP-26 will seek to focus on carbon credits and trading in them, including to allow off-set against emission reduction commitments and liabilities, and the development of carbon credit trading. As noted above (and below), increased carbon credits, in theory, will narrow the gap between the projected increase in GHG emissions and the NDCs of some countries.
It is critical to keep in mind that the use of carbon credits, while important, will not achieve the level of GHG emission reductions required to achieve NZE. The effective use of carbon credits, and the development of trading platforms for high-quality carbon credits, will "buy time" for the corporations purchasing them and for the rest of us by slowing the rate of increase in GHG emissions.
The slowing of the rate of increase in GHG emissions will slow the rate at which we deplete the global carbon budget, but ultimately decarbonisation of activities giving rise to GHGs is required.
A number of commentators have suggested that a global price on carbon should be on the COP-26 agenda.
While a global price on carbon would link directly to the market for carbon credits, the author does not consider that a price on carbon is an appropriate agenda item for COP-26 or any Conference of Parties.
This is not because a price on carbon is not a good idea in the right setting, but because the imposition of a global price on carbon would have to take account of current policy settings (including current customs and excise duties and taxes on fossil fuels) in each country, and is "a third rail" that is best left untouched.
A carbon price is a tool used to encourage participants in markets to move to lower, low or no carbon technologies. In some countries a carbon price makes sense, but it makes sense only if it is set at a level that encourages the development and deployment of lower, low or no carbon technologies (and those technologies are available or on the horizon) – this is the logic for any carbon price, whether set through an emissions trading scheme or as a carbon tax, or both.
The "price on carbon versus technology" debate is one that the Federal Government of Australia has been sharing for a while: technology, not a carbon price (or in Australian parlance, a carbon tax), will result in progress to achieving NZE. The Federal Government of Australia is committing tax-payer money to support the development of technologies which the Government hopes will find a market.
The debate that the Federal Government of Australia shared is incomplete in that it ignores the rate at which reductions in GHG emissions need to be achieved, and that a price on carbon provides a benchmark for the cost of a lower, low or no carbon technology displacing carbon. This debate will no doubt continue.
On October 6, 2021, S&P Global Platts reported on the assessment of the US EIA (the US Energy Information Administration). The S&P Global Platts report notes that the projection of the US EIA in its International Energy Outlook (IEO) is that global energy demand will grow by 47% by 2050, and oil and natural gas will remain the largest source of energy.
The assessment of the US EIA "underscores the stark challenges ahead for transitioning away from fossil fuels and curbing global warming emissions".
The IEO is stark. It is the counterfactual to the aspirational NZE, and emphasises the importance of the reduction of GHG emissions by 45% (or more) by 2030, if not sooner. As noted in previous editions of Low Carbon Pulse, leaving decarbonisation to markets will not result in NZE.
As noted above, there is a Commitment and Production Gap. COP-26 will not resolve the Commitment and Production Gap, but this gap needs to be discussed, and the Paris Rulebook needs to address how Parties to the Paris Agreement will address this gap.
As noted above , and to provide emphasis, in the week leading up to COP-26, the Commitment and Production Gap has received more concerned coverage than any other matter.
Throughout 2021 the mass of and the speed at which publications have been released has increased, in part in anticipation of COP-26. This has been the case, in particular, since May 18, 2021.
Since May 18, 2021, in addition to the 2021 Report, the following reports have been published, earliest first, most recent last (all summarised in Low Carbon Pulse):
In the lead up to COP-26, many papers, reports and studies have been published. In the context of COP-26 the following seem the most relevant:
On October 5, 2021, the International Energy Agency (IEA) continued its prolific year with the publication of its Global Hydrogen Review 2021 (IEA GH2R).
As always with IEA publications, the IEA GH2R is both helpful and informative, and as such well-worth a read, and continues the consistent engagement of the IEA in respect of hydrogen (see The Future of Hydrogen Report). Of particular interest to the author is the Hydrogen Projects Database.
The key message from the IEA GH2R, in particular for the purposes of COP-26, is one that will be familiar to readers of Low Carbon Pulse: the role of Government is central to the development of both the Blue Hydrogen and Green Hydrogen industries, and as such the associated development of hydrogen-based fuels.
This key message is consistent with the messaging from the IEA since well before Edition 1 of Low Carbon Pulse. Edition 27 of Low Carbon Pulse (under A role for Government in the development of supply and demand for hydrogen) referenced an opinion piece from Wood Mackenzie: "… [COP-26] must go far far beyond setting new emission targets. Ensuring that hydrogen is not just a "fuel of the future", but a fuel that needs to be … implemented into global society from today [and] should be top of the agenda".
The IEA GH2R will be considered in detail in the October Report on Reports (in the Appendix to Edition 30 of Low Carbon Pulse).
On October 6, 2021, the US EIA published its International Energy Outlook (IEO). As noted above, the IEO may be regarded as an assessment of what supply and demand will be given current policy settings, and as such without material and significant initiatives that change this direction of travel. (The October Report on Reports will consider the IEO in detail.)
This IEO is a read for the positive realist, determined to press for progress on the basis of higher and faster GHG emissions, and stronger enforcement, together. This said, the positive realist needs to understand that the US IES may be regarded as plotting a demand / consumption curve above those plotted by others in the recent past.
On October 7, 2021, the IEA published its Curtailing Methane Emissions from Fossil Fuel Operations (CCH4R). It will be no surprise to readers of Low Carbon Pulse that the headline from the CCH4R is that the reduction in methane (CH4) emissions is "among the most impactful ways to combat near-term climate change".
As noted in the Anniversary Edition of Low Carbon Pulse, one of the areas of progress since October 2020 has been the recognition of the need to address CH4 emissions, culminating in the Global Methane Pledge, signed by the European Commission (EC) and the US on September 17, 2021. As at noon on October 29, 2021, 24 countries have committed since then, including Argentina, Indonesia, Italy, Mexico, and the UK, with New Zealand considering joining, and the Kingdom of Saudi Arabia has committed to joining.
The IEA has been advocating consistently for a focus on CH4 emissions for some time, and will no doubt continue to do so.
The CCH4R notes (as it has noted on a number of occasions), that: "Methane has contributed around 30% of the global rise in temperature to date … Emissions from fossil fuel operations present a major opportunity [to limit global warming in the near term] since the pathways to reduction are both clear and cost-effective".
The CCH4R will be covered in detail in the October Report on Reports (in the Appendix to Edition 30 of Low Carbon Pulse).
In passing, it is important to note that while the focus of the CCH4R is CH4 arising from the extraction, production and transportation of fossil fuels, CH4 arises from agriculture, forestry and other land use (AFOLU) and waste and waste water. At the same time as CH4 emissions from fossil fuel operations are being targeted, CH4 emissions from waste and waste water need to be addressed (see below A role for Government in decarbonising AFOLU and A role for Government in the development of Bioenergy).
As noted in other editions of Low Carbon Pulse, AFOLU is challenging, but addressing waste, in particular landfill, and waste water should be alongside addressing CH4 emissions from fossil fuel production. This requires policy settings and implementation from Government to align with the waste management system.
On October 13, 2021, the IEA published its World Energy Outlook 2021 (IEA WEO). The key message from the IEA WEO is that the world is in energy transition but the rate of progress towards energy transition, and the achievement of progress towards NZE, needs to increase.
The IEA WEO will be covered in detail in the October Report on Reports (in the Appendix to Edition 30 of Low Carbon Pulse).
On October 13, 2021, the International Renewable Energy Agency (IRENA) published its A Pathway to Decarbonize the Shipping Sector by 2050 (DESS Roadmap).
The DESS Roadmap notes that currently the shipping sector uses fossil fuels, and that it is necessary to displace fossil fuels so as to reduce CO2 emissions. The DESS Roadmap provides a description of the ways and means to the displacement of fossil fuels so as to achieve an 80% reduction in CO2 emissions by 2050.
Director General of IRENA, Mr Francesco La Camera provides a clear picture: "[The DESS Roadmap] clearly shows that cutting CO2 emissions in such a strategic, hard to abate sector, is technically feasible through [the use of] green hydrogen fuels."
IRENA contemplates that up to 70% of the fuels used in the shipping sector by 2050 will be hydrogen-based fuels. Without necessarily wanting to pick winners, IRENA suggests that the use of e-ammonia could provide close to 45% of the energy demand from the shipping sector by 2050.
In some ways, the DESS Roadmap may be regarded as conservative given the initiatives already "on the water", critically, the progress that the shipping industry is making in the use of hydrogen-based fuels (see Editions 26 and 27 of Low Carbon Pulse).
The shipping sector is increasing, some might say intensifying, efforts to reduce the GHG emissions arising from the sector. By way of a reminder, the shipping sector gives rise to up to 3% of global GHG emissions (expressed in CO2-e terms), with the International Maritime Organisation suggesting 2.9% and IRENA suggesting around the same. A recent article (entitled Enduring waves of climate change: Maritime Decarbonization, a tempest before the calm) from the ever accurate S&P Global Platts provides a balanced perspective, noting the scale of the task, balanced with the achievability of the task.
The October Report on Reports (contained in Appendix to Edition 30 of Low Carbon Pulse) will consider the DESS Roadmap in detail.
On October 19, 2021, the IEA published its paper Phasing Out Unabated Coal – Current status and three case studies (UAC Paper). The UAC Paper carries forward one of the key findings in the IEA WEO – critically, the need to end investment in new unabated coal-fired power plants, and to retrofit, and to repurpose, existing coal-fired capacity.
As is typical in IEA publications, the UAC Paper contains a number of recommendations: 1. Allow sufficient time for consultation and implementation of phase out plans; 2. Provide support for affected communities, including workers; 3. Ensure that security of electrical energy supply is maintained as "a cornerstone of phase-out policies"; 4. Implement carbon pricing; 5. Improve the climate for investment in clean electricity and the necessary infrastructure; and 6. Consider conversion of coal generation assets.
Recommendations 1 to 3, and 5 and 6 will come as no surprise.
The implementation of recommendation 4 (Implementing carbon pricing) may come as a surprise given the need to accelerate the retirement of coal-fired power generation is more about development of new renewable electrical energy capacity as soon as practicable, than use of a carbon price.
On October 20, 2021, the IEA published its report Achieving Net-Zero Electricity Sectors in G7 Members (NZE ES Report). The NZE ES Report was requested by the UK (which holds the G7 this year). As might be expected, the NZE ES Report builds on the finding from the IEA Roadmap published on May 18, 2021.
The NZE ES Report will be considered in detail in the October Report on Reports (in the Appendix to Edition 30 of Low Carbon Pulse).
In the October 9, 2021 edition of The Economist, the venerable publication reflected on the size of the current hydrogen industry, at 90 million metric tonnes per annum (mmtpa) and USD 150 billion.
Given current technologies (steam methane removing, grey hydrogen production and gasification, black or brown hydrogen production), around 6% of the natural gas and 2% of coal production is used each year to produce this 90 mmtpa of hydrogen.
The production of the 90 mmtpa gives rise to between 850 and 900 mmtpa of GHG emissions, or around 1.8% of the 50 Giga-tonnes CO2-e GHG emissions arising each year.
As such, hydrogen produced using these technologies is not going decarbonise the production of energy carriers to displace hydrocarbons; rather CCS / CCUS to produce Blue Hydrogen and electrolysers and renewable electrical energy will do this.
The Economist notes the degree of difficulty and the scale of the endeavour. To remind the reader of the various colours of hydrogen, the Ashurst Hydrogen Rainbow is included below.
Ashurst Hydrogen Rainbow:
The Ashurst Hydrogen Rainbow (a creation of the author of Low Carbon Pulse), is intended to provide an aide memoire to the reader. It is noted that the author of Low Carbon Pulse took liberties with both the colour coding of hydrogen and the spectrum: adding Red Hydrogen (at the top of the Rainbow) to represent the difficulty of making a return on any early stage clean or low hydrogen project, and adding Grey, Brown, Black and White (at the bottom of the Rainbow) for completeness of the colours that are used to describe hydrogen.
On October 4, 2021, UK Prime Minister, Mr Boris Johnson announced that by 2035 all electrical energy dispatched to satisfy load in the UK would be matched by renewable electrical energy. This is the perfect response to the impact of the shortage of natural gas on the electrical energy prices in the UK: the best cure for higher prices is higher prices, resulting in increased supply or in a switch to another technology or increased use of an existing technology.
Stating the obvious, the switch to an existing technology is occurring, and needs to accelerate. Until the switch reaches a tipping point, the UK Government, like many countries around the world, needs an energy security policy (sufficient supply side to avoid sustained higher prices). While an inconvenient truth, the UK and EU countries may need more gas-fired power stations to provide required energy supply, and those gas-fired power stations will have to be developed with CCS / CCUS. As frequent readers of Low Carbon Pulse, and sister publications of Low Carbon Pulse, will know, this is a long-standing perspective of the author of Low Carbon Pulse.
On October 7, 2021, the United Arab Emirates (UAE) committed to reduce its GHG emissions to NZE by 2050 – see below (under GCC Countries update) for more detail.
Edition 28 of Low Carbon Pulse noted the good news arising from the United National General Assembly during the week beginning September 20, 2021, that Turkey had committed to ratify the Paris Agreement. The commitment had to be ratified by the parliament of Turkey. On October 8, 2021, the parliament of Turkey ratified the accession of Turkey to the Paris Agreement.
On October 18, 2021, the Republic of Korea (ROK) increased its NDC from 26.3% to 40% by 2030, compared to 2018. This is considered in more detail below under Republic of Korea (ROK) News.
On October 24, 2021, the Kingdom of Saudi Arabia (KAS) committed to reduce its GHG emissions to NZE by 2060. The commitment of the KAS, and the associated steps to implementation (see below under GCC Countries update) for more detail demonstrate in the clearest of terms the economic, environmental and social transformation that is upon us.
As note in Edition 28 of Low Carbon Pulse, the Federal Government of Australia has been the subject of scrutiny by the international community and its own citizens because it had not committed to the achievement of NZE by 2050.
On October 26, 2021, the Federal Government of Australia announced its commitments to NZE. (see below under Australia – Weighted Progress for the reported perspectives on the commitment)
The UK Government hosted the UK Global Investment Summit (GIS), on October 19, 2021.
Notable announcements from the GIS are captured in the following press release – click here – from the UK Government providing a high level overview of the outcomes and commitments from the GIS.
During the week of GIS, the UK Government announced two strategies – Net Zero Strategy:
Build Back Greener and Heat and Building Strategy. These strategies will be considered in detail in the October Report on Reports.
As foreshadowed in previous editions of Low Carbon Pulse, ahead of COP-26, current and relevant matters would be considered, including the roles to be played by key players.
Edition 28 of Low Carbon Pulse contemplated that Edition 29 would cover the Role of Government in decarbonising Agriculture Forestry and other Land Use (AFOLU) and the development of bio-energy. It contemplated also that the Role of Carbon Credits and Coal would be considered. We have covered Carbon Credits, but not Coal. (the LIAC Paper does this effectively)
Edition 28 of Low Carbon Pulse noted that AFOLU is hard to decarbonise. In many countries, some may say in most countries, agriculture has cultural, political and social significance. In the interests of food security and political expediency, in many countries agriculture receives direct and indirect funding support, including policy settings intended to ensure maintenance of the value of certain crops.
Given these dynamics, the decarbonisation of the AFOLU sector is best regarded, and is best calibrated, on a country by country, area by area, basis.
In this context, there is a role for Government in ensuring that it "does no harm" having regard to the areas within a country in which it seeks to set policies that will result in a reduction in GHG emissions. In the context of "doing no harm", there is a role for Government at a number of levels. In the collection of waste, rather than crop burning (over 3.5% of GHG emissions expressed in CO2-e terms), and providing value to landholders to avoid deforestation (close to 2.5% of GHG emissions). In these areas alone, there is close to 7% of the total mass of CO2-e GHG emissions "in play".
In addition, Governments can encourage afforestation and reforestation and wilding of land, and practices to reduce GHG emissions arising, including to provide value for these forms of land use, including by use of carbon credits. These activities have value in that they remove GHG emissions from the climate system. The removal of GHG emissions from the climate system means that the rate at which our global carbon budget is being depleted will slow. Governments are now acting on the ability of certain trees and crops to absorb CO2.
The most potent GHG emission arising from agriculture is CH4, including raising livestock (around 5.8% of GHG emissions expressed in CO2-e terms) and growing certain crops (up to 2.2%). (CH4 is more potent than CO2 (see Edition 27 of Low Carbon Pulse)).
As noted above, initiatives to collect waste, to change land use and to remove GHG emissions from the climate system will allow progress to decarbonising the AFOLU sector, but given the potency of CH4, more needs to be done. What needs to be done in terms of CO2 removal activities needs to be determined and planned by Governments. And countries that export products that have given rise to CH4 need to do more still.
A key part of planning needs to consider the trees, and other vegetation (green carbon), that can achieve the highest levels of CO2 absorption (sequestration capacity) on a sustainable basis within areas of countries. Governments are ideally placed to map and to monitor trees and other vegetation to assess the sequestration capacity of trees and vegetation, above and below ground.
In addition, the use of coastlines and the nearshore in certain regions of the world offer potentially vast sequestration capacity (blue carbon). For example, mangrove forests and swamps, and areas with sea-grasses and tidal marshes, provide ecosystems that can absorb CO2. For Government, the task is to assess how much of the coastlines and the nearshore can be used to progress the development of blue carbon sequestration capacity.
It is estimated that one mangrove tree will absorb 12.4 kg of CO2 a year on average. Taking the benchmark of the Kingdom of Saudi Arabia to plant 50 billion trees (see Edition 13 of Low Carbon Pulse), 50 billion mangrove trees will absorb 620 million metric tonnes (mmt) per annum (mmtpa). It is possible to plant 5,000 mangrove trees per hectare, with each hectare absorbing 62 metric tonnes (mt) per annum (mtpa) of CO2. 50 billion mangrove trees could be planted on 10,000,000 hectares.
In contrast, a palm tree will absorb around 2.3 kg of CO2 a year. On October 25, 2021, the US State of Florida announced plans to replace palm trees with native canopy trees, which absorb a greater mass of CO2. Palm oil trees are different, and the data on their ability to absorb CO2 has quite a spread. Taking the highest estimate of the spread at 57.6 mtpa per hectare, palm oil trees appear comparable with mangrove swamps. This is not to suggest deforestation and planting of palm oil trees (the broader challenges with palm oil are well known and beyond the scope of this Edition 29 of Low Carbon Pulse), rather it is to provide a point of comparison.
By way of further comparison, a pine free will absorb around 10 kg of CO2 a year. On the basis that there are approximately 1,000 trees per hectare, the pines trees in that hectare will absorb 10 mtpa of CO2.
"Higher, Faster, Stronger" is a good description for bamboo: bamboo is a super-absorber of CO2, storing CO2 in its biomass, particularly its root system (its extensive root system being good for soil quality, preventing soil erosion and assisting in the restoration of soil-depleted areas). For these reasons, the planting of bamboo may be regarded as integral to long-term agricultural redevelopment and agroforestry.
As with the reporting on the capacity of palm oil to absorb CO2, the reporting on the capacity of bamboo to absorb CO2 varies somewhat. At the higher end, one hectare of bamboo is reported to be able to absorb between 17 and 20 mtpa of CO2. Bamboo is fast growing, and mature groves of bamboo can be established within two to three years. Bamboo is an effective above ground carbon and below ground carbon absorber.
For every 10 million hectares of land used to grow bamboo, between 170 and 200 mmtpa of CO2 will be absorbed each year. India is estimated to have around 12.4 million hectares of bamboo groves.
For each country, an immediate focus should be the assessment and analysis of the use of trees, other vegetation and crops, best suited to the environment in which they are grown, including the return of land to the wild (and paying for the benefit of doing so). An assessment of this kind will yield an understanding of optimal land use, from both an economic and environmental perspective, and a means to realise value from carbon credits.
The IEA Roadmap and the IRENA WETO both identified the development of bio-energy capacity as key to achieving NZE under the scenarios outlined in them. As noted in previous editions of Low Carbon Pulse, bio-energy is energy derived or produced from biomass, whether that energy is in gaseous, liquid or solid form. Bio-energy is derived from organic matter, but not fossilised organic matter.
The sources of biomass for use as feedstock or fuel are many and varied, but in the context of GHG emissions, the organic waste stream arising from human activities provides a renewable resource that, if collected, processed and used, can reduce GHG emissions, avoiding or reducing CH4 (and CO2) on the decomposition of that organic matter, and the displacement of fossil fuels with that bio-energy.
The importance of the reduction in CH4 emissions in explained in Edition 27 of Low Carbon Pulse. Reflecting this, the EU and US have recently committed (in the Global Methane Pledge) to reduce CH4 emissions by a third within the next decade (see Edition 27 of Low Carbon Pulse).
For the production of bio-energy to be carbon-neutral, it must be combined with carbon capture and storage, BECCS, or with carbon capture and use or storage, BECCUS. For bio-energy production using BECCS to make a contribution to a reduction in GHG emissions, it must displace another electrical energy source or energy carrier source, and, in any event, it must result in a carbon neutral outcome (rather than a carbon removal outcome) so as not to give rise to an increase in GHG emissions.
This is where Government has a role to play. As has been noted in respect of CCS / CCUS in the context of carbon clusters (invariably located around ports and the hinterlands of ports), the storage of CO2 is likely to require Government funding support, and also Government risk support. It is no surprise that both the IEA Roadmap and the IRENA WETO contemplate tying the development of the bio-energy to CCS / CCUS to capture and to store the CO2 arising from the production of bio-energy.
Progress towards achievement of NZE is not a zero sum game. More than that, it is to be expected that there will be increased scrutiny of the life-cycle and GHG emission footprint of asset and infrastructure life, and responsibility for recovery and recycling of organic matter giving rise to GHG emissions (in the same way as with metals and mineral and plastics, which is a topic for another edition of Low Carbon Pulse).
Across all human activities, waste arises and GHG emissions arise. Globally, Government has a role to play in the development of waste management systems from the point of the waste arising to the point of recycling, re-use, or disposal, including in this context, the recycling and re-use of biomass, and the disposal into storage of CO2.
The broader AFOLU, waste and waste water sectors are estimated as giving rise to up to 95% of anthropogenic CH4 emissions globally. Given the impact of CH4 emissions on climate change, there is an immediate and present reason to capture the life-cycle of carbon in the broader AFOLU and waste and waste water cycles. Organic matter in waste and waste water decomposes. The rate of decomposition varies. On decomposition, CH4 and CO2 arise.
Capturing the life-cycle of carbon is best framed and achieved through Government collection and consolidation initiatives. These will include the derivation and production of biogas, and biomethane for pipeline gas, from waste to displace natural gas over time. Further, if CO2 arising on the production and use of biogas or any other biofuel is captured and used, and matched by new growth biomass to absorb an equivalent mass of CO2 arising on oxidation / use of that biogas or other biofuel, the promise of bio-energy will realised.
In the agricultural sector, the implementation of policy settings of this kind would become the core of an environmentally and economically sustainable sector, including by use of the digestate arising from the derivation and production of bio-gas, and the use of cover crops and perennial crops.
While this piece is intended to identify the role of the Government in the development of bio-energy, the author thought that it may be helpful to outline the role of Government more broadly in the waste sector as progression is made towards the achievement of NZE, and as such outline the policy settings that are emerging and likely will emerge.
As progress towards NZE is made, the mass of waste arising on the extraction of metals and minerals, on the manufacture of equipment and infrastructure, on the transportation and installation of that equipment and infrastructure, and at the end of the life-cycle of that equipment and infrastructure, will increase. The most prominent waste streams from progress towards the achievement of NZE are solar panels and wind-turbines, Net-Zero Waste if you will (not to be confused with the existing use of this phrase as to describe another policy setting – Net-Zero Waste to landfill).
More broadly, the policy settings for the management of E-Waste and Net-Zero Waste are very much in the process of being re-based in the context of E-Waste and formulated in the context of Net-Zero Waste. The phrase E-Waste is used to describe waste that arises from electronic equipment used for business, domestic, industrial or scientific use, including equipment needed for Information and Communications (ICE). In a recent report, it is estimated that between 2.1 and 3.9% of global GHG emissions arise from equipment that becomes E-Waste. In part, this reflects that the production of ICE gives rise to GHG emissions (including some of the more potent), housed in plastics that are not designed for recycling, using heavier metals, the life-cycle of which needs to be understood and captured. Ultimately, all residual materials needs to be captured for safe and sustainable recycling or disposal.
Improved and new policy settings are needed if extraction and manufacturing is to be decarbonised in the case of ICE, and if GHG emissions are to be avoided in the case of equipment and infrastructure manufactured and developed, for the purposes of achieving progress towards NZE.
Policy setting for recovery, recycling and disposal of materials arising at the end of life-cycle needs to be contemplated sooner rather than later, and the means of recovery, recycling and disposal developed by Government or with its support, and its use mandated.
Net-Zero Waste is not yet a concept, but for present purposes it includes waste that arises from the extraction, manufacture, transportation and use of equipment and infrastructure developed for the purposes of reducing GHG emissions, including on the extraction of metals and minerals used in the manufacture of solar panels and wind towers and turbines, and energy storage systems (including BESSs) on the manufacture of those panels, towers and turbines, and systems, and on recovery and recycling of resources from them at the end of their life-cycles, and the means of disposal of any material that cannot be recovered or recycled.
There has been considerable coverage around the role of carbon credits in achieving NZE, not least because of the record high prices being paid for carbon credits in both compliance / mandatory markets (Mandatory Markets) and in voluntary markets (Voluntary Markets).
In Mandatory Markets (typically, in the context of an emissions trading scheme structured as a-cap-and-trade), carbon credits have value if they can be used to acquit, i.e. can be used to offset, an obligation to match the GHG emissions arising from the activities of a corporation with emissions trading permits (ETPs) that organisation is required to acquire under that emissions trading scheme. In this context, the value of carbon credits will be a function of the operation of the Mandatory Market, including the market price of ETPs and the consequences (including liability) under that emissions trading scheme for not acquitting or being able to offset.
In Voluntary Markets, carbon credits have value to corporations that have committed to achieving GHG emission reductions (and in the longer term NZE on the basis of carbon neutrality). Previous editions of Low Carbon Pulse have covered the uses of words and phrases in this context, but ultimately, decarbonisation takes time, and needs to be achieved across Scopes 1, 2 and 3 emissions. To buy the time, while still reducing GHG emissions on a net-basis, corporations buy carbon credits. In this context, the value of carbon credits is less well-defined than in a Mandatory Market and will tend to depend on the position of the corporation buying the carbon credits, and whether the carbon credits are going to underpin a transaction (for example, the sale of carbon neutral cargo of liquified natural gas or oil or an investment).
Acknowledging that some folk will debate this, the perspective of the author is that ultimately decarbonisation of activities is the only means of achieving NZE, and as such the role of carbon credits is to place a value on activities that remove CO2 from the climate system: the value is quantified in mass, with one metric tonne of CO2 having a value. As NZE is achieved, the carbon sinks absorbing CO2 the subject of the carbon credits should be used to remove CO2 in the climate system on an absolute basis.
The benefit of the removal of CO2 from the climate system is that it reduces the rate at which the global carbon budget is depleted, and in the case of CO2 that is removed from the climate system that is not subject to a carbon credit scheme, that removal of CO2 gives rise to a net-reduction in the GHG emissions.
Generally the challenge with carbon credits is the monitoring, measurement and determination, and auditing and verifying (accounting and accountability) the mass of CO2 actually removed from the climate system and sequestered in a carbon sink.
As noted in Edition 16 of Low Carbon Pulse, it is thought that the mass of GHG emissions assumed to being sequestered in carbon sinks is greater than the actual CO2 that actually sequestered, and is being sequestered, in those sinks. This is important, because they need to be the same. If they are not the same, the purpose of carbon credits is not being achieved.
Specifically, the challenge with some carbon credits issued in some countries (developed and developing) is that carbon credits are issued in respect of activities that do not remove CO2 emissions from the climate system. Further, the basis of accounting and accountability in some countries does not provide a level of assurance that CO2 is being removed. For those purchasing carbon credits, this matters. The fact that there is an increasingly segmented market for carbon credits tends to reflect that this matters.
Carbon credits are issued by Governments, reflecting the policy settings of those Governments. It is hoped that at COP-26, there is discussion and progress as to the basis upon which carbon credits should be issued so as to provide a level of consistency globally.
Further, it is hoped that the basis of standards of accounting and accountability to be applied are developed, and that those standards are carried forward in the laws and regulations of each country issuing carbon credits, and compliance with those standards will be required so as to access the higher prices that are being paid for high-quality carbon credits.
The Visual Capitalist provides a Voluntary Markets 101 outline, among other things, outlining the four key participants in the voluntary carbon credit markets, project developers, standards bodies, brokers and end buyers. The link is accessed with a click. The link has an accompanying descriptive narrative. In passing, it is noted that Governments are key, both as framers and as possible participants in voluntary carbon credit markets.
In addition to the Visual Capitalist, Shell has recently published Exploring the Future of the Voluntary Carbon Market, developed by it in collaboration with BCG. The publication is well-worth a read, providing a balanced perspective. The October Report and Reports will consider the publication in more detail.
At this point in recent Editions of Low Carbon Pulse, sections have been included on Climate change reported and explained and Visualisation and Listening Platforms and Tools, and useful materials. To manage the length of this Edition 29 of Low Carbon Pulse, these sections are not included, but will return in future Editions.
On October 6, 2021, the United Arab Emirates (UAE) became the first Gulf Cooperation Council (GCC) country to commit to achieving NZE. This is a materially significant commitment in a global context, and for the UAE it will spark a once in a generation, or possibly even, as some have noted, a one-of-a-kind shift in the economy of the UAE, driven and effected by the level of investment required to effect the shift to what will be a photovoltaic solar and Blue Hydrogen and Green Hydrogen economy.
The UAE is ahead of the curve in many ways, having already realised capital through its program selling interests in infrastructure assets and selling down interests in operating businesses, including on listing of them.
In Arab News on October 9, 2021, Chief Executive of Engie in the Kingdom of Saudi Arabia (KAS), Mr Turki Al-Shehri, expressed considerable enthusiasm around the development of Green Hydrogen, contrasted with caution around the development of Blue Hydrogen projects because these projects have become "much more difficult" to finance.
While a number of commentators may have questioned the development of Green Hydrogen, those at the forefront of the development of Green Hydrogen projects are convinced of the need and that progress is occurring: " … it's a global energy changer. Green hydrogen is coming. Even before it was a buzzword, [Engie has been spending roughly] €60 million a year on green hydrogen research around the world".
The KAS has some of the best renewable electrical energy resources globally, and as a result, some of the world's lowest cost electrical energy: KAS has reliable sunshine rates during the day, and reliable winds at night. This was proved up further on October 18, 2021 as the KAS announced the Round 3 of the NREP (see KAS shortlists bidders on Round 3 of renewables below).
On October 10, 2021, Masdar (Abu Dhabi Future Energy Company) announced that it had signed a strategic agreement to explore renewable energy opportunities in the Republic of Turkmenistan. This builds on the commitment that Masdar has demonstrated regionally. As noted previously in Low Carbon Pulse, Masdar is a member of the elite club of global "go to investors" in the renewable energy sector.
Consistent with the role of Masdar as a member of the elite club of global "go to investors", Masdar has obtained a credit rating to assist in its facilitation of, and investment in, projects.
On October 14, 2021, it was announced that Fertiglobe (a joint venture between ADNOC and OCI Chemical (world leading producer of soda ash)) and Scatec (a leading renewable electrical energy producing corporation) have entered into an agreement with the Sovereign Wealth Fund of Egypt (SFE) to develop a 50 – 100 MW electrolyser to produce Green Hydrogen as feedstock for the production on Green Ammonia.
The Green Hydrogen production facility is to be located near Ain Sokhna, close to existing facilities of a subsidiary of Fertiglobe, EBIC. Under the agreement, Scatec is to build, operate and own (a majority interest) the Green Hydrogen facility, with the Green Hydrogen to be supplied to EBIC to produce Green Ammonia.
See: Scatec partners with Fertiglobe and the Sovereign Fund of Egypt to develop green hydrogen as feedstock for ammonia production in Egypt; Fertiglobe Partners with Scatec and the Sovereign Fund of Egypt to Develop Green Ammonia Project in Egypt
On October 11, 2021, the Saline Water Conversion Corporation and Cummins announced that they intend to develop a hydrogen production facility in the KAS.
See: Cummins website; Saline Water Conversion Corporation website
On October 16, 2021, Huawei Digital Power (HDP) and SEPCOIII (EPC contractor for the Red Sea Project as part of the development of NEOM (see Update on NEOM below)) signed a contract under which HDP is to supply a 400 MW / 1,300 MWh BESS.
See: Huawei to Power the World's Largest Energy Storage Project
On October 17, 2021, it was reported widely that OQ (the Omani state-owned energy company) had signed a Joint Development Agreement with Dutco, Linde and Marubeni to undertake feasibility studies to assess the development of a 400 MW Green Hydrogen and Green Ammonia production facility (SalalahH2 Project) within the Salalah Free Zone in Oman. The SalalahH2 Project will make use of OQ's existing ammonia production plant at Salalah.
As reported in previous editions of Low Carbon Pulse (see Editions 18, 20 and 26), OQ is progressing a Green Hydrogen within the Duqm Special Economic Zone with DEME (leading Belgian corporation).
Edition 14 of Low Carbon Pulse reported on the Round 2 of the National Renewable Energy Program (NREP). At the inauguration for the Sakaka IPP on April 8, 2021, Crown Prince Mohammad bin Salman bin Abdulaziz announced the results of the tenders for seven large-scale solar capacity projects under. The seven new projects are to be located in Jeddah, Madinah, Quarayyat, Rafha, Rebigh, Al Shuaiba and Sudair.
The 600 MW Al Shuaiba photovoltaic solar project was being awarded on the basis of a world record low bid price for electrical energy of USD 0.0104 kWh (a little over 1 cent per kWh, or USD 10.40 per MWh). The Sudair photovoltaic solar project was awarded with the second lowest bid price of USD 0.01239 (1.239 cents per KWh or USD 12.39 MWh). On development, the Sudair photovoltaic solar project will be the Kingdom's largest solar project, comprising around 1.5 GW of installed capacity. Approximately 3.6 GW of energy was contracted under Rounds 1 and 2 of the NREP.
On October 18, 2021, it was reported widely that KAS' Renewable Energy Project Development Office (Repdo) had shortlisted bidders for Round 3 of the NREP, with 1.2 GW to be contracted under Round 3. There two categories of project in Round 3, Category A and Category B.
Category A projects are the 120 MW Wadi al-Dawasir PV IPP (WADIPP) and the 80 MW Layla PV IPP (LIPP). It is understood that TotalEnergies and Tamasuk Holding Company and the Acwa Power Consortium (comprising Acwa Power, SPIC (Huamghe Hydropower Development Company) and WEHC (Water and Electric Holding Company) ranked first and second on the WADIPP and Acwa Power Consortium and Alfanar ranked first and second on the LIPP.
Category B projects are the 700 MW Al-Rass PV IPP (ARIPP) and the 300 MW Saad PV IPP (SIPP). It is understood that the Acwa Power Consortium and Jinko Power ranked first and second on the ARIPP and that Jinko and Masdar ranked first and second on the SIPP.
As noted above, the Round 2 of the NREP resulted in a world record low bid price. Round 3 of the NREP has not quite resulted in the same outcome, but the pricing is nevertheless at a level that continues the narrative about low photovoltaic solar costs. It is reported that the levelized cost of electricity (LCOE) bids have tariffs at the following: WADIPP US cents 1.9 kWh, LIPP US cents 3 kWh, ARIPP US cents 1.5 kWh and SIPP US cents 1.5 kWh.
On October 19, 2021, on the sidelines of the UK Global Investment Summit (see section entitled G20 activity and commitments in the lead up to COP-26 above), Qatar Energy (formerly Qatar Petroleum, the state owned leading international energy corporation) and Shell (leading global international energy corporation) signed an agreement under which they will pursue jointly a Blue Hydrogen and Green Hydrogen project in the UK in which they can invest jointly.
On October 24, 2021, Crown Prince Bin Salman announced that the KAS would reduce its GHG emissions to NZE by 2060, with a reduction of 278 million metric tonnes per annum (mmpta) of GHG emissions by 2030. The financial capacity of the KAS makes the achievement of NZE by 2060 a high probability.
For these purposes, the Crown Prince announced that the KAS would invest USD 186 billion, join the Global Methane Pledge (see Edition 27 of Low Carbon Pulse), plant 450 million trees by 2030 and rehabilitate 8 million hectares of land. It is estimated that the planting of trees and the rehabilitation of land will reduce the CO2 emissions by 200 mmtpa. This initiative of itself will make a meaningful contribution to progress towards NZE.
On October 24, 2021, the world's largest corporation, Saudi Aramco, announced that it would target the reduction in GHG emissions to NZE by 2050.
On October 27, 2021, Saudi Aramco announced that it had signed a memorandum of understanding with InterContinental Energy and Modern Industrial Investment Holding Group to develop Green Hydrogen and Green Ammonia production facilities in Saudi Arabia. As readers of Low Carbon Pulse will be aware, InterContinental Energy is involved in large scale renewable electrical energy and Green Hydrogen and Green Ammonia projects in Australia and in the UAE.
On October 27, 2021, Abu Dhabi National Oil Company (ADNOC) and Emirates Water & Electric Company (EWEC) formed a clean energy partnership under which ADNOC is to be supplied by EWEC with clean energy matching 100% of ADNOC's electrical energy load.
EWEC will supply clean energy from nuclear and photovoltaic solar sources to ADNOC under an off-take agreement. This establishment of the partnership, underpinned by the off-take agreement, is aligned to achieving NZE by 2050.
The development of NEOM, the smart city, in Tabuk Province, on the coast bordering the Red Sea is progressing, and it is understood that visitors (including tourists) will be welcome from 2024. Key to the development of NEOM is that it is to be powered by 100% renewable electrical energy, including the use of Green Hydrogen. On October 30, 2021, fuelcellsworks.com provided a helpful update.
Recent editions of Low Carbon Pulse have outlined the policy settings and the private and public sector investment initiatives in India. On October 7, 2021, pv magazine, reported on a study from Lappeenranta-Lahti University (often mentioned in Low Carbon Pulse) and Wärtsilä.
The headline from the study is that using an all renewable electrical energy system (with 76% photovoltaic solar), and appropriate levels and location of BESS, the cost of electrical energy in India could be reduced by up to 50% by 2050, while at the same time making a major contribution to progress towards NZE.
The study (and other publications) tend to feed confidence that in respect of the development, the renewable electrical energy progress is likely to be made to achieve NZE across the electrical energy sector. This should not be taken for granted, but it is possible for the optimist to conclude that we will get there. The electrical energy sector is however the easiest part of the global economy to decarbonise. The difficult to decarbonise sectors (including cement, chemical and petrochemical, glass and iron and steel) and the transport sector (aviation, road freight and shipping) remain.
On October 28, 2021, pv-magazine, noted that India is expected to install 14 GW of photovoltaic solar capacity in calendar year 2021, having installed 8.8 GW of capacity in the first nine months. As noted in previous editions of Low Carbon Pulse, the development and deployment of roof-top photovoltaic solar in India is highly prospective. It would appear that this assessment is being realised with 2 GW of the 8.8 GW installed in the first nine months of 2021 being roof-top photovoltaic solar.
On October 29, 2021, pv-magazine, noted that scientists at the KPR Institute of Engineering and Technology have developed a process to recycle silicon from solar panels at the end of their life-cycle. If the process is scalable, it seems to the author to be a significant shift in process technology.
On October 29, 2021, pv-magazine reported that tenders have been invited for the development of "advanced-chemistry battery cell manufacturing units in India". The tender is open to applications until December 31, 2021. It is reported that bidders must commit to setting up a minimum of 5 GWh of capacity to qualify for subsidies.
Edition 19 of Low Carbon Pulse reported that on June 1, 2021, India and the UK had enhanced their existing partnership to provide for cooperation in sharing thinking around policy settings, which in turn will respond to, and drive, technology development and investment as both countries progress to electrified and hydrogen economies, driven by the development of renewable electrical energy. More broadly, and in the context of specific outcomes, the provision and sourcing of sustainable finance will be a key part of electrification and the development of a hydrogen economy, in particular clean energy and clean transport technologies and solutions, and the shift to green and to greened businesses.
On October 11, 2021, h2-view.com, reported that India and the UK intend to build on, or rather refine further, their collaboration, through a Government-to-Government agreement so as to contribute to the acceleration of progress towards the development clean energy capacity. The Government-to-Government agreement was formalised at a meeting of India's Minister for Power and New & Renewable Energy, Mr Raj Kumar Singh, and UK Energy Secretary, Mr Kwasi Kwarteng on October 8, 2021. It is understood that in the context of COP-26, the ministers discussed the launch of the India and UK Government Global Green Grid – One Sun One World One Grid Initiative.
The Government-to-Government agreement with the UK follows the announcement from the meeting of the Quad countries (US, India, Japan and Australia) in late September as which it was agreed: 1. to cooperate to allow the development of a green-shipping network, with each country to work with each other country to reduce GHG emissions arising from the shipping value chain; 2. to establish a Clean Hydrogen Partnership, including for the purposes of technology development and scaling up of hydrogen production on an efficient basis, with the intention to stimulate demand to accelerate trade in clean hydrogen in the Indo-Pacific region; and 3. to increase the Indo-Pacific region's resilience to climate change by improving climate change information sharing and disaster-resilient infrastructure.
Edition 3 of Low Carbon Pulse reported on the commitment of ROK to achieving NZE by 2050. Since the commitment to NZE made on October 28, 2020, there has been expectation that ROK would increase its NDC from 26.3% by 2030 compared to 2018.
On October 18, 2021, the ROK increased its NDC to 40% by 2030 compared to 2018. As with the increased NDC to which Japan committed in April 2021, this may be regarded as a challenging target for ROK. Nevertheless, it is a target that ROK will able to achieve.
On October 22, 2021, DFC agreed with Korea West Power and KEPCO to develop a Pure Biogas (Hydrogen) fuel cell R&D project.
On October 25, 2021, it was announced that Bloom Energy and SK are to expand their blooming partnership to fortify their market leadership in the use of fuel cell technology to generate electrical energy and to establish leadership in the hydrogen economy. The budding and then growing nature of the relationship between Bloom Energy and SK has been covered in Low Carbon Pulse (see Editions 4, 17 and 22).
Leaving the poor puns to one side, the expansion of the partnership is good for each corporation and more broadly – both organisations are at the forefront of early adoption of fuel cell technology and first movers in the development and deployment of it. The arrangements underpinning the expansion include SK contracting for equipment supply and service provision (estimated at USD 4.5 billion), and a further equity investment by SK in Bloom Energy.
See: Bloom Energy's announcement
On October 26, 2021, it was reported widely that Korean Southern Power (KOSPO) had opened the new Incheon Bitdream Fuel Cell Power Plant (Bitdream FCPP). The Bitdream FCPP uses fuel cell technology supplied by POSCO Energy and Doosan Fuel Cell. The Bitdream FCPP is reported to have capacity of 78.96 kWh, which can be used to supply electrical energy to up to 250,000 households and hot water for up to 40,000 households. The Bitdream FCPP is reported to have capacity of 78.96 kWh, which output can be used to supply electrical energy to up to 250,000 households and hot water for up to 40,000 households.
The opening of Bitdream FCPP is further realisation of the use of the power companies to use fuel cell technology (see Edition 2 of Low Carbon Pulse).
Edition 28 of Low Carbon Pulse included a piece entitled, Australia – A Curate's Egg. This description appears unlikely to be revised any time soon.
On October 13, 2021, the IMF released its Word Economic Outlook. In addition to the role of Australia as a key producer of iron ore, the IMF noted the importance of the cobalt, nickel and lithium resources of Australia for the purposes of the required expansion of resources to supply the global battery industry.
The IMF notes that demand for the supply of these key metals will increase dramatically as the scale of the renewable electrical energy industry increases, and an associated increase for battery storage arises, principally for battery electric vehicles (BEVs) and battery electric storage systems (BESSs).
By way of background or as a reminder, the five key metals in the "battery age" (at least for the time being) are aluminium, copper, cobalt, nickel and lithium. It is anticipated that demand for: 1. aluminium will increase to allow "light-weighting" to occur, particularly across the transport sector; 2. copper will increase, with demand for BEVs and grids and infrastructure (distribution and transmission) and machinery generally; 3 cobalt is less certain, with its demand profile dependent on technology development; 4. nickel will increase, with increased supply of nickel effectively responding to the new demand, and in the context of increased demand for (and therefore use of) nickel, stainless steel production will be the primary driver; and 5. lithium will increase to satisfy demand for lithium-ion batteries, in particular in the stationary energy sector, critically for BESSs.
As noted in Edition 22 of Low Carbon Pulse (in a feature on Form Energy), iron (using iron-air technology) could soon be joining these five metals as key metals in the "battery age". If this potential is realised, Australia will continue its role, and even enhance its role, as a key source of metals and minerals as raw materials to support progress towards the achievement of NZE.
In Edition 28 of Low Carbon Pulse, it was reported that the Federal Government of Australia had yet to commit to meaningful GHG emission targets or to NZE by 2050. As a result, for some time, the Federal Government of Australia has been under scrutiny by the international community and its own citizens: at once both the lucky country and the recalcitrant country, a country that could lead but a country that chooses not to do so.
On October 26, 2021, the Federal Government of Australia committed to achieving NZE by 2050. This commitment was not accompanied by meaningful GHG emissions targets on route to NZE. The approach manifest in the commitment to NZE by 2050 is consistent with the technology versus carbon tax debate that the Federal Government of Australia has been sharing in support of the approach that it has been taking (see section above entitled A price on carbon).
The commitment to NZE has been criticised from all sides. For those in favour of the commitment to NZE, the means of achieving NZE has been described as more "prayer than policy" due a lack of meaningful commitments to GHG emission reductions before 2030, and an absence of a staged pathway to achieving NZE by 2050. For those not in favour the commitment to NZE, the criticism is best described as variable, and none of it capable of withstanding reasoned scrutiny.
On October 13, 2021, Premier Annastacia Palaszczuk committed her State of Queensland to progressing to NZE by 2050. This commitment followed a vote the Queensland Parliament on October 12, 2021. This commitment came in a week packed full of announcements about the development of the Green Hydrogen industry across Queensland.
During the week beginning October 25, 2021, the State of South Australia, continued its progress towards becoming a 100% renewable electrical energy State. The State Government of South Australia is committed to achieving net 100% renewables by 2030. The events of the last week tend to indicate that the State of South Australia will achieve this target as early as 2025 at the current rate of progress.
On October 25, 2021, ElectraNet announced the installation of four synchronous condensers (in effect acting as spinning reserve). The installation of the synchronous condensers means that the restrictions on the dispatch of renewable electrical energy across the ElectraNet grid are not as stringent as previously under certain conditions: the restrictions providing a limit to the dispatch of variable renewable electrical energy sources to the grid so as to be assured of continued integrity and stability.
As reported in previous editions of Low Carbon Pulse, the State of South Australia has been a stellar performer, but during the last week it has eclipsed previous achievements with photovoltaic solar and wind reaching 81% at the start of the week, and 85% over three days of the last part of the week.
On October 29, 2021, the State of Victoria reported that it achieved a 25% reduction in GHG emissions compared to 2005, between 2005 and 2019. The State Government of Victoria has delivered on its pledge to reduce GHG emissions by 20% by 2020 (in fact it is has exceeded it), and is well on the way to delivering on its pledges to reduce GHG emissions by between 28% to 33% by 2025, and to between 45% to 50% by 2030.
As has been noted previously in Low Carbon Pulse, the eight States and Territories of Australia are both ambitious and progressive in reducing GHG emissions and progress towards achieving NZE. The ambition and that progressiveness are not static.
Edition 28 reported on the publication by the Australian Hydrogen Council of its Unlocking Australia's hydrogen opportunity. On October 29, 2021, a Wood Mackenzie publication outlined further the scale of the opportunity for Australia.
Previous editions of Low Carbon Pulse have covered the policy settings for energy transition in PRC. On October 10, 2021, the visualcapitalist.com, published five graphics that allow the viewer to visualise the transition from now to 2060 (the year by which the PRC has committed to achieve NZE).
On October 12, 2021, President Xi Jinping made a speech to the fifteenth conference of the parties to the Convention of Biological Diversity. President Xi confirmed the commitment of the PRC to achieve peaking of GHG emissions by 2030, and NZE by 2060. (Edition 30 of Low Carbon Pulse will include a one page summary of the outcomes from COP-15 to the Convention of Biological Diversity.)
To deliver on these commitments, President Xi said that it would be necessary to introduce policy settings (named "l+n") to achieve peaking of GHG emissions and then NZE. For these purposes, President Xi noted the need to increase the installation of photovoltaic solar and wind in desert areas of the PRC.
This is not new (having been noted in Edition 21 of Low Carbon Pulse, and confirmed in the next piece), but it may be regarded as further demonstration of the commitment of the PRC to mobilise sufficient renewable energy resources to achieve peaking and NZE, and consistent with the prospect of use of High Voltage Direct Current (HVDC) cables to deliver renewable electrical energy.
On October 29, 2021, it was reported widely that the PRC's National Development and Reform Commission (NDRC) confirmed that the development of a number of renewable electrical energy projects was proceeding across a number of provinces in the north and north-west of the PRC – Gansu (12.85 GW), Inner Mongolia (2 GW of photovoltaic solar), Ningxia, Qinghai (10.9 GW), Shaanxi (2 GW), and Xinjiang (GW). Once completed, the projects will have combined installed capacity in the region of 30 GW. It is understood that ultra-high voltage connection will be used for the purposes of transmission from generation to load, with some projects to deploy hydrogen energy storage systems (HESS).
As noted in previous editions of Low Carbon Pulse (and touched on above, under A role for Government in the development of Bioenergy), bio-energy is energy derived or produced from biomass, whether that energy is in gaseous, liquid or solid form. Bio-energy is derived from organic matter, but not fossilised organic matter.
Note: For the production of bio-energy to be carbon-neutral, it must be combined with BECCS or BECCUS. For BECCS / BECCUS to make a contribution to a reduction in GHG emissions, it must displace another electrical energy source or energy carrier source, and, in any event, it must result in a carbon neutral outcome (rather than a carbon removal outcome) so as not to give rise to an increase in GHG emissions.
On October 5, 2021, a report entitled CCUS Development Pathway for the EfW Sector, produced by Eunomia Research & Consulting, commissioned by waste company, Viridor, notes the ability of the EfW sector to help underpin the continued development of the CCS / CCUS sector in the UK, effectively BECCS and BECCUS.
On October 7, 2021, rechargenews.com, Repsol (world leading oil and gas corporation, head-quartered in Spain) announced plans to develop 200 MW of biogas / biomethane steam reforming capacity (to derive hydrogen from biomass itself derived from biomass) to produce Blue Hydrogen, and 350 MW of electrolyser capacity, powered by renewable electrical energy from 1.8 GW of photovoltaic solar and wind, to produce Green Hydrogen. It is anticipates that this clean hydrogen capacity will be developed by 2025, with around USD 1.5 billion earmarked for these initiatives alone.
On October 18, 2021, the-eic.com, reported that this was part of broader initiatives involving the development of 20 GW of renewable electrical energy by 2030, and an investment of €2.5 billion to develop a hydrogen chain by 2030, as part of its renewable hydrogen strategy, with 550 MW to be developed and deployed by 2025 (200 MW of Blue Hydrogen and 350 of Green Hydrogen capacity, as noted above).
See: Repsol will invest €2.549 billion to boost renewable hydrogen
On October 17, 2021, biofueldigest.com, reported that Haldor Topsoe (leading technology provider, including electrolysers and its eSMR technology) has commenced operation of a demonstration plant that derives methanol from biogas (a combination of CO2 and CH4 for the most part, derived from biomass). It is stated that the plant produces sustainable methanol, and has the capacity to produce 10,000 litres of CO2 neutral methanol.
On October 29, 2021, it was reported widely, that a site had been secured by CHBC (a member of Yosemite Clean Energy) to develop a carbon-negative renewable hydrogen and renewable natural gas (RNG) production facilities in Oroville, California. As reported, 31,000 kgs (31 metric tonnes) a day of RNG and 12,200 kgs (12 metric tonnes) a day of renewable hydrogen will be produced.
A rechargenews.com article notes that: "Because biomethane is produced from plant matter that absorbed CO2 from the air as it grew, the gas which is produced in large tanks known as anaerobic digesters – it is said to be carbon neutral when burned or cracked". As readers of Low Carbon Pulse will know, this is not incorrect, but it is important to add that CO2 and CH4 arises from the production of biogas / biomethane, and from the production of hydrogen from it, and that CO2 and CH4 needs to be captured. Of course, the hydrogen gives rise to no GHG emissions at the point of use other than water vapour which, while is a GHG emission, does not remain in the atmosphere in the same way that CO2 and CH4 (and other GHGs) do.
The purpose of repeating these dynamics is to ensure that it is understood that the use of bio-energy as an integral part of progress to achieving NZE is about effective collection systems for bio-energy feedstocks (all of which are carbon intensive), the capture and storage of CO2 arising from the production of those feedstocks, and ensuring, through monitoring and verification, that the CO2 arising on use of bio-fuels is absorbed by renewable biomass growth. This is the basis of achieving carbon-neutrality in fact, rather than in concept.
There are many sources of biomass. One of the most fertile grounds is waste arising from the growth of crops, the rearing of livestock, waste arising in the food supply chain (from field to fork) and waste and waste water.
Continuing a narrative and a theme (commenced in previous editions of Low Carbon Pulse, added to above under A role for Government in decarbonising AFOLU), one of the means of achieving negative GHG emissions is through the development of new growth, or the regeneration / restoration, of mangrove swamps and the restoration of wetlands generally (being a generic phrase that includes mangrove swamps, estuaries, and mud-flats), in particular in the tropical areas of the world.
Certain countries have the ideal climates and coastlines to develop carbon sinks to sequester carbon. It is estimated that, since 1900, a little over 50% of the global coasted wetlands have been removed.
In addition to the negative GHG emission benefits, the restoration of wetlands will provide protection against storm damage as noted in a recent report from James Cook University, which considers land use in 71 countries that had wetlands in the path of storms.
As such, there are two benefits of the new growth and regeneration / restoration: the absorption of CO2 and the absorption of the impact of storms (and as such, adaptation to climate change, aligned with Article 2.1(b) of the Paris Agreement).
In the context of the development of markets for carbon credits (in particular voluntary carbon markets or VCMs), discussion around Article 6 of the Paris Agreement has become more pressing. There is a great opportunity for certain countries, in particular those in the tropical regions of the world, to add to the global carbon budget by the development of new growth and the regeneration / restoration carbon sinks. While this discussion relates to both Blue Carbon and Green Carbon, it is included here for convenience.
To do this effectively, i.e., in a manner that results in the issue of high-quality carbon credits from the sale of which those countries realise appropriate value, the focus of the discussion around Article 6 and the Paris Rulebook needs to be on the assessment of existing carbon sinks and new growth or regeneration / restoration carbon sinks, and accounting and accountability, and the funding of the three A's (assessment, accounting and accountability) by developed countries and policy banks.
As noted above, in respect of the UNFCCC NDC Synthesis Report, a Catastrophic Pathway awaits unless GHG emission reductions are slowed, reduced and balanced. A key means to slowing, reducing and balancing is the use of carbon credits and allowing their use to off-set GHG emission obligations.
In an article published in October 29, 2021, the Independent Commodity Intelligence Services (ICIS) outline the current dynamics surrounding Article 6 of the Paris Agreement and the VCM. The article is well-worth a read – it is balanced and clear.
On October 27, 2021, SciTech Daily , reported (under Marine Carbon Sequestration: New Research Delves Into Fate of Ocean Carbon), on new research undertaken by the oft mentioned Lawrence Livermore National Laboratory (LLNL), with the work published in the Proceedings of the National Academy of Sciences. Edition 27 of Low Carbon Pulse reported on a study from CSIRO (Commonwealth [of Australia] Scientific and Industrial Research Organisation) which found that up to 80% of the 715 million tonnes of CO2 released to the climate system from Australian bush fires over the southern hemisphere summer 2019/2020 has been absorbed by ocean algal blooms in the Pacific Ocean.
The LLNL research builds on concepts arising from CSIRO findings. Both studies recognise that algae and plankton are one of the many natural carbon sinks in the blue carbon setting, and that understanding them is critical.
As renewable electrical energy is developed and deployed, BESS (and HESS) will be required to ensure that renewable electrical energy is stored to allow dispatch of electrical energy from storage to maintain grid integrity and stability, and to provide electrical energy as the variable nature of renewable electrical energy dispatch necessitates dispatch from BESS to match load.
As the scale of development and deployment of renewable electrical energy becomes clearer, so does the scale of the development and deployment of BESS (and HESS). The analysts as Wood Mackenzie have been assessing and quantifying how much BESS may be required.
In Wood Mackenzie's Global Energy Storage Outlook (published on October 7, 2021), it is estimated that up to 1 TWh of storage may be required. This assessment is underpinned by reasonably consistent assessments that during 2021, around 12 GW of BESS will be installed globally, and an anticipated acceleration of development and deployment of BESS, including, in the near term, acceleration in the PRC. The question that is yet to be firmed is the extent to which BESS will be utility, sometimes referred to as in-front of the meter, and off-grid (including to store from roof-top photovoltaic solar), more often than not referred to as behind the meter.
On October 5, 2021, the Director General of the Petroleum Directorate, Ms Ingrid Solvberg, indicated that the continental shelf of Norway had the capacity (in theory at least) to store 1,000 years of GHG emissions arising from Norway. As part of the operation of natural gas fields, the two largest two CCS projects, at Sleipner and Snovhit, are operated in Norway.
Edition 27 of Low Carbon Pulse reported on the applications process currently underway for two CCS sites on the continental shelf of Norway. The deadline for the submission of applications is December 9, 2021. As noted in previous editions of Low Carbon Pulse, the Norway continental shelf is the location of the Equinor, Shell and TotalEnergies Northern Lights project (as part of the Longship Project), and the proposed location of CCU for the CO2 arising from the Barents Blue (Blue Ammonia) project (see Edition 27 of Low Carbon Pulse).
Previous editions of Low Carbon Pulse have covered the progress being made by the Acorn Project, and its importance to the Scottish Cluster (see Editions 14, 16, 17, 21 and 22).
Edition 21 of Low Carbon Pulse noted that the Acorn Project was contracting with a number of corporations for the provision of carbon storage services. Edition 21 of Low Carbon Pulse reported ExxonMobil, Royal Dutch Shell and North Stream Midstream Partners (NSMP, owned jointly by the Kuwait Investment Authority and JPMorgan Infrastructure Fund) had signed provisional deals (under memorandums of understanding) with the Acorn Project. The underlying business case for the Acorn Project is that CO2 captured from natural gas processing terminals at St Fergus, Peterhead (and Grangemouth) will be stored by it. The provisional deals with ExxonMobil and Shell are in respect of their terminal and in respect of the NSMP owned terminal (with NSMP also the owner of the main feeder lines to it).
On October 6, 2021, ExxonMobil announced that it had signed an expression of interest to study the storage of CO2 from its Fife Ethylene Plant. The progression to expression of interest in respect of the Fife Ethylene Plant may be regarded as further stride for the Acorn Project.
On October 12, 2021, it was reported widely that the Acorn Project had agreed to provide carbon storage services in respect of CO2 captured at a new Blue Hydrogen facility in the Thames Estuary (Project Cavendish), and then transported, using a CO2 carrier from the Thomas Estuary to Peterhead Port (owned and operated by the Peterhead Port Authority), and then on to the Acorn Project.
As noted in previous editions of Low Carbon Pulse, the Acorn Project is the key element of the Scottish Cluster – see Edition 23 of Low Carbon Pulse. Project Cavendish is likewise covered in Edition 23 of Low Carbon Pulse.
For Storegga Geotechnologies, this is another step in progress towards the realisation of its landmark, market defining, CCS project. CEO of Storegga, Mr Nick Cooper, noted that the signing of a memorandum of agreement with Project Cavendish and the Peterhead Port Authority, "demonstrates how the Scottish Cluster can decarbonise not only Scottish emitters but those throughout the UK and Europe".
As noted below, the UK Government selected the East Coast Cluster (comprising Net Zero Teesside and Zero Carbon Humber) and HyNet North West as the two CCS projects that were to receive government support in the Track 1 CCS Programme (see Edition 23 of Low Carbon Pulse): the policy setting provided for the selection of two CCS projects (as outlined in Edition 23).
Notwithstanding the decision of the UK Government in respect of the CCS projects is receive Track 1 government support, it is understood that the Scottish Cluster, with the Acorn Project at its core, will continue to progress.
In Edition 28 of Low Carbon Pulse, it was reported that Wood Mackenzie provided an update on the cost of CCS in an opinion piece entitled Carbon capture and storage: how far can costs fall? which provides access to the proprietary report. Having re-read the Wood Mackenzie piece for the September Report on Reports, the author commends the piece to all readers again. As reported in previous editions of Low Carbon Pulse, Wood Mackenzie's view is that between 4 and 6 Gtpa of CO2 needs to be captured and stored for these purposes. For the potential of CCS / CCUS to be realised, it is important to realise its potential! Up to 30% of the required reduction in GHG emissions could be achieved by effective CCS / CCUS.
On October 10, 2021, it was reported widely that Equinor (global leading international energy company) intends to invest up to USD 12 billion in the production of Blue Hydrogen using CCS technology. Equinor intends to use natural gas as the feedstock for the production of Blue Hydrogen.
As noted in previous editions of Low Carbon Pulse (and as noted in this Edition 29), natural gas gives rise to fugitive GHG emissions, and on its use to produce Blue Hydrogen, gives rise to CO2 which needs to be captured and stored. As noted above, if CO2 is not captured, the production of hydrogen using natural gas as the feedstock gives rise to around 10 metric tonnes of CO2 for each 1 metric tonne of hydrogen produced. While this is a rule of thumb, it is a helpful rule of thumb. Given that Equinor is aiming to have a 10% share of the global hydrogen market by 2030, this is going to equate to avoidance of CH4 fugitive emissions and capture and storage of significant mass of CO2.
On October 10, 2021, the Oil and Gas Authority in the UK granted a carbon storage licence (CSL) to Harbour Energy (HE). The CSL will cover an area in the Southern North Sea 140 km off the coast of Immingham, Lincolnshire. HE proposes to store CO2 in the depleted Rotliegend gas fields, Victor and Viking (the V Net Zero Project).
The geological formations in which the CO2 will be stored are around 2743 metres (9000 ft) below the sea-bed of the North Sea. CO2 to be injected into the V Net Project will be transported using the existing pipeline to the Victor / Viking fields. A new pipeline will transport CO2 from the point source of capture to the on-shore connection point on the existing pipeline, for transportation into storage.
On October 13, 2021, Repsol outlined its plan to develop a CCS project as part of the Sakakemang natural gas development project, off the coast of Sumatra, Indonesia. It is understood that the CCS project will store up to 2 million metric tonnes per annum (mmtpa).
As understood, the CCS project will involve the use of the depleted Gelam and Dayung natural gas fields to effect enhanced gas recovery from the Sakakemang project.
Edition 28 of Low Carbon Pulse reported that Hansen Cement had produced clinker using a 100% net zero mix of heat-temperature fuels in its cement kiln. Also Edition 28 of Low Carbon Pulse reported that California Governor, Mr Gavin Newsom, signed SB 596 which mandates the reduction of carbon emissions per ton of cement produced by 40% by 2035, compared to 2019. In addition, the California Air Resources Board is to develop a NZE strategy to decarbonise the production of cement completely by 2050.
On October 12, 2021, global cement and concrete makers outlined steps to reduce CO2 emissions by "an additional 25%" by 2030, and to progress to NZE by 2050; conservatively a reduction of this magnitude would result in a 5 Giga tonne reduction in CO2 emissions assuming a linear rate of reduction. It is reported that the cement and concrete industry will transition to carbon-free technologies for the high-heat temperatures required to produce clinker, carbon capture to capture the CO2 arising on the use of limestone to produce clinker, and new chemistry and manufacturing technology.
The second article in the Shift to Hydrogen (S2H2) series provides details on the mass of GHG arising from the production of cement and concrete globally. Edition 28 of Low Carbon Pulse noted that the cement production industry needed to decarbonise the production of clinker as the process of producing clinker releases CO2. Decarbonisation of the production of clinker can be achieved by the use of high-heat temperature non-fossil fuels and the capture of CO2 arising naturally from the limestone used to produce the clinker.
CO2 arises from the production of clinker as follows: CO2 arises from both the use of fossil fuels or carbon intensive fuels and the production of clinker from limestone, i.e., calcium carbonate (CaCO3) – for every molecule of CaCO3 used to produce cement, one molecule of CO2 arises. As such cement requires both the reduction in carbon intensive fuels and the capture of CO2. Stated another way, for each metric tonne of cement produced, one tonne of CO2 emissions arise.
This graphic is the best summary that the author has seen of explaining the anatomy of what is required to achieve NZE across the cement and concrete industry.
The Global Cement and Concrete Association estimates that around 14 billion m3 of concrete is poured to cast each year (1 m3 of concrete has a mass of approximately 2.41 metric tonnes). The mass of cement produced and concrete poured to case is going to increase as urbanisation increases globally.
The production of cement alone give rise to between 7% and 8% of GHG emissions. As noted above, one metric tonne of cement gives rise to one metric tonne of CO2 .
Edition 23 of Low Carbon Pulse outlined the industrial carbon clusters and hydrogen hubs around the UK which are in the process of being developed, and a number of them awaiting the outcome of applications for government support in Track 1 of the CCUS Programme. The CCUS Programme is consistent with key outcomes in the Ten Point Plan for a Green Industrial Revolution (10 Point Plan).
On July 30, 2021, the UK Government announced five eligible projects for its CCUS (cluster sequencing) Programme, detailed below:
On October 19, 2021, the UK Government announced the results of applications for government support in Track 1 of the CCUS Programme. The East Coast Cluster and the HyNet North West projects were selected for government support. It is clear that the quality of each of the five eligible projects was very high. Had all five eligible projects proceeded, they would have provided production capacity for up to 9.7 GW of low-carbon hydrogen by 2030, 4.7 GW more than the 5 GW contemplated in the Ten Point Plan.
(From earlier communications, the announcement had been expected on October 25, 2021.)
Shortly after announcing the outcome of Track 1 of the CCUS Programme, the UK Department for Business, Energy and Industrial Strategy announced new investment in the Net Zero Strategy, noting in the period since the announcement of the Ten Point Plan (see Edition 4 of Low Carbon Pulse), the UK Government has "mobilised GBP 26 billion of government capital investment for the green industrial revolution".
On October 21, 2021, Natural Gas World reported the Exxon Mobil Corporation (leading global international energy corporation) is to expand its CCS capacity at the LaBarge natural gas field in Wyoming. It is understood that the expansion will increase CCS capacity by 1 million metric tonnes per annum (mmtpa) of CO2 .The LaBarge field is known for its high level of CO2 at about 65%, with 21% CH4, 7% N and 5% H2S and 0.6% He.
On October 25, 2021, Channel News Asia, reported that ExxonMobil Corporation (leading global international energy corporation) is considering the development of CCS Hubs in South East Asia (SEA). Edition 27 of Low Carbon Pulse reported on the plans of ExxonMobil Corporation to develop a CCS Hub in the Gulf of Mexico to store up to 50 million metric tonnes per annum (mmtpa) of CO2.
It is understood that ExxonMobil is "studying the concept of placing CO2 capture hubs in some of Asia's heavy industrial areas such here in Singapore and then connecting them to CO2 storage locations elsewhere in the region". While this concept is not new, the fact that ExxonMobil is considering the concept is encouraging: there is no organisation as expert at assessing the capacity of depleted fields.
Editions 20 and 21 of Low Carbon Pulse reported that Singapore does not have suitable sub-surface structures (under land or sea) suitable to allow use for CCS, and as such the ExxonMobil study is aligned with these findings.
Editions 20, 21 and 26 of Low Carbon Pulse have reported on initiatives of Rio Tinto to green its smelters. On October 20, 2021, Rio Tinto announced plans to invest in the development and deployment of up to 5 GW of photovoltaic solar and wind capacity to provide renewable electrical energy for its Boyne Island and Tomago smelters.
In addition, Rio Tinto has announced that it will develop and deploy a further 1 GW of renewable capacity to provide electrical energy for its iron ore mines in the Pilbara region of Western Australia. The development and deployment of renewable energy is part of the commitment of Rio Tinto to reduce its GHG emissions by 15% by 2025, and 50% by 2030. The accompanying price tag of achieving this reduction is estimated to be AUD 7.5 billion, and is stated to focus on the decarbonisation of its aluminium and iron ore divisions.
On October 27, 2021, Rio Tinto announced that it had signed a memorandum of understanding with Carbix, under which Carbix is to use land surrounding Rio Tinto's ISAL smelter in Straumsvik, Iceland to store carbon captured from industrial facilities and plants around Europe.
The carbon captured will be liquified at the point source of capture, and transported by vessel to the Coda Terminal, Iceland, with the CO2 to be re-gasified at the Coda Terminal, and dissolved into water (creating carbonated water). The carbonated water is to be injected into rocks underground. On injection into the rocks, the rocks will release cations (being an ion (atom or atoms) with a positive charge), including calcium, iron and magnesium. These elements combine with the CO2 dissolved in the carbonated water to produce carbonates that are stored within the rocks. The carbonates are stable, and this process can be regarded as storing CO2 permanently.
On October 8, 2021, Hz-Inova (HZI) announced that it has contracted with CO2 Energie AG to develop a plant to separate and to liquefy CO2 from an existing biogas facility. The biogas (and biomethane) is derived from biomass processed at a digestion facility (presumably using anaerobic digestion technology). The capture and the liquefaction of the CO2 will allow the CO2 to be transported and used or possibly stored.
On October 10, 2021, it was announced that the Northern Lights Joint Venture has awarded contracts for the construction of two dedicated CO2 carriers. The construction contract has been awarded to Dalian Shipbuilding Industry Co., Ltd (located in Dalian, Liaoning province, the PRC.)
Each CO2 carrier has 7,500 m3 of containment capacity (to carry liquefied CO2 under pressure), with delivery scheduled for mid-2024. The CO2 carriers are to be Norwegian flagged, and classified by leading international classification society, DNV.
The procurement of the two CO2 carriers represents further progress in the realisation of the Northern Lights Project (as part of the Longship Project) reported on in previous editions of Low Carbon Pulse (see Editions 2, 3, 11, 16, 17, 19 and 20).
The use of captured CO2 to produce methanol (CH3OH) is being undertaken. The use of CO2 to produce CH3OH will give rise to clean or e-methanol if renewable electrical energy is used to provide the required electrical energy. The production of methanol using CO2 involves the use of electrical energy to combine CO2 with H2 to produce CH3OH.
As noted in previous editions of Low Carbon Pulse, the combustion of methanol will give rise to CO2, and as such it is not a no / non carbon fuel. If however the CO2 is captured from the processing of biomass (for example on bio-fuel production, using BECCS or BECCUS), in theory at least, if biomass is grown that will absorb and equivalent mass of CO2, that bio-methanol may be characterised as carbon neutral.
Edition 17 of Low Carbon Pulse (under Yara and JERA leading the way from WA to Tokyo Bay) reported on the signature of a memorandum of understanding between JERA Co, Inc (the largest power generation company in Japan, being a joint venture between Tokyo Electric Power and Chubo Electric Power) and Yara International ASA (world leader in ammonia production) to work together in the production and delivery of, and supply chain development, for Blue Hydrogen and Green Hydrogen.
On October 5, 2021, it was reported widely that JERA, Yara and Idemitsu Kosan have signed a memorandum of understanding (MOU) to explore the establishment of a domestic distribution network for ammonia from Idemitsu Kosan's Tokuyama Complex, the establishment of a bunkering business at the Tokuyama Complex and the optimisation of the use of ammonia. Given the parties to the MOU, it may be expected that it will result in the development of discussion around the production and use of fertiliser for the agriculture and power sectors, using the refining capacity and existing infrastructure and refining capacity of Idemitsu.
As has been reported in earlier editions of Low Carbon Pulse, JERA is at the forefront of the use of ammonia to transition to "zero-emission thermal power plants".
In addition to the Yara / JERA news, Edition 18 of Low Carbon Pulse reported (under IHI and JERA granted means to commence co-firing) that IHI Corporation (IHI) and JERA had received notice of acceptance of their joint grant application to undertake a demonstration project to co-fire ammonia in the generation of thermal power using Units 4 and 5 of JERA's 1 GW Hekinan Thermal Power Station.
On October 6, 2021, it was reported widely that IHI and JERA had commenced co-firing of coal and ammonia at the Hekinan Thermal Power Station. The commencement of co-firing is part of a program (scheduled to complete in March 2025), with the objective of co-firing ammonia (20%) and coal (80%). As noted in Edition 17 of Low Carbon Pulse, Unit 5 is being used to develop the co-firing burner, with Unit 4 to be used as the co-firing burner is scaled up.
Reflecting on activity in GCC countries, JERA is opening an office in the UAE. This is significant because JERA is the largest electrical energy generator in Japan, and it is an early adopter of hydrogen-based fuels, including in its blending of ammonia for use in thermal power stations. It is to be expected that JERA will procure Blue Hydrogen and Blue Ammonia in the near term, and Green Hydrogen and Green Ammonia in the medium to longer term.
See: JERA announcements here, here and here
On October 5, 2021, it was reported widely that ADX Energy and Windkraft Simonsfeld have agreed to develop Green Hydrogen production and storage facilities to be located in the Northern Vienna basin. The Green Hydrogen will be produced using a PEM electrolyser, with the renewable electrical energy from wind power and with the Green Hydrogen to be stored underground to act as a HESS to be used to maintain grid integrity and stability.
See: ADX Energy website; Windfraft Simonsfeld website
As readers of Low Carbon Pulse will know, the activities of Plug Power, Inc., are reported reasonably consistently, which is a function of the activity of Plug Power. For example, Edition 28 of Low Carbon Pulse reported that: "one of the first movers in the development of supply side Green Hydrogen, Plug Power Inc., is continuing its roll-out of Green Hydrogen production capacity in the US with the development of a production facility in Fresno County, California (Fresno Facility)".
Within the news cycle for this Edition 29 of Low Carbon Pulse, even by the standards of Plug Power, it has been busy:
Edition 5 of Low Carbon Pulse reported that on January 7, 2021, Plug Power Inc. and SK Group intended to form a strategic alliance with the objective of accelerating the development of the hydrogen economy in the Republic of Korea, and Asian markets more broadly. In January 2021, Low Carbon Pulse described, "Plug Power, Inc. is a clear leader in fuel cell technology, Green Hydrogen production and distribution", and that "the SK Group is active in the fuel cell technology, fixed and mobile uses of fuel cell technology, including working with Bloom Energy on a number of fixed fuel cell technology projects."
On October 6, 2021, it was reported widely that Plug Power and SK Group (leading Republic of Korea chaebol, and leader in progress towards NZE) had entered into a joint venture to develop and deploy technology so as to accelerate the development of the hydrogen economy across Asian markets. Given the expertise Plug Power and SK Group, it is to be expected that they will work together to develop electrolysers, fuel cell systems and technologies, and hydrogen refuelling infrastructure. It is understood that Plug Power and SK Group intend to develop a giga-factory so as to allow the production of electrolysers and fuel cell systems and technologies at scale.
See: Plug Power website; SK Group website
Dr Andrew Forrest, AO (founder of Fortescue Metals Group, one of the Big Three Australian iron ore producers, and before that the driving force behind the development of the enduring Murrin Murrin Nickel Project) knows the "real deal" when he sees it. Dr Forrest established Fortescue Future Industries (FFI), and is chair of it.
As noted below, on October 10, 2021, Dr Forrest announced the development of a giga-factory at Gladstone, Queensland. On October 14, 2021 Dr Forrest announced that the giga-factory would be developed in a 50 / 50 joint venture with Plug Power, with the giga-factory to develop proton exchange membrane (PEM) electrolysers.
See: FFI website; Plug Power website
On October 12, 2021, Plug Power Inc announced a collaboration with Airbus SE, under which they would work together to mobilise the use of Green Hydrogen across the airport and aviation sector, with Airbus providing insight in respect on the use of Green Hydrogen to power and to propel aircraft, and Plug Power to design, develop and deploy hydrogen infrastructure at airports.
See: Airbus website; Plug Power website
On October 12, 2021, Plug Power announced that it had signed a memorandum of understanding with Phillips 66 to advance Green Hydrogen across the mobility / transport sector. Phillips 66 and Plug Power are going to work together to develop low carbon hydrogen technology to be designed, developed and deployed across the operations of Phillips 66.
See: Phillips 66 website; Plug Power website
On October, 26, it was reported widely that Plug Power had commenced construction of its Green Hydrogen production facility in the Town of Alabama, Genesee County, New York, as part of the Science, Technology and Advanced Manufacturing Park (STAMP).
Previous editions of Low Carbon Pulse have noted on STAMP (see Editions 11, 13, and 26).
On October 27, 2021, it was reported widely that Plug Power and Lhyfe has agreed to pursue jointly the development of Green Hydrogen facilities across Europe, with the intention to develop and to deploy 300 MW Green Hydrogen facilities by 2025, and to develop a 1 GW production site.
On October 7, 2021, Sunfire announced plans to develop and deploy a 500 MW alkaline electrolyser by 2023 to allow it to respond to projected increased demand for Green Hydrogen. This represents continued progress by Sunfire, with the announcement accompanied by news of further fund raising.
See: Sunfire website
On October 7, 2021, Air Products (one of the big three industrial gas producers globally, with Air Liquide and Linde) announced that it had started to liquefy 30 metric tonnes of hydrogen a day at its La Porte facility, with the hydrogen being liquefied sourced from the existing Gulf Coast Hydrogen Pipeline, with the liquified hydrogen (LH2) gas. The LH2 gas will be delivered from the La Porte facility to industrial customers using tanker-trailers.
See: Air Products website
Edition 23 of Low Carbon Pulse reported that:
On October 8, 2021, it came as no surprise to read that Horisont Energi and Koole Terminals intend to combine to develop an ammonia terminal and storage facility within the Port of Rotterdam.
At the risk of banging the private sector drum too loud and too long, this is another instance of the private sector combining to develop infrastructure ahead of the supply and demand for hydrogen and hydrogen based fuels.
See: Horisont energi website; Koole Terminal BV website
On October 10, 2021, it was reported widely that Itochu Corporation (leading Japanese trading house) and NEL ASA (leading electrolyser technology supplier) had entered into a strategic partnership in the hydrogen sector. NEL is a manufacturer of both alkaline and proton exchange membrane (PEM) electrolysers, each used in the production of Green Hydrogen. The purpose of the strategic partnership is to identify hydrogen businesses that Itochu and NEL may develop, including production, transportation and distribution.
See: Itochu website; NEL ASA website
On October 12, 2021, it was reported widely that CS Energy (Queensland government owned generation company) and IHI Corporation (IHI) are to proceed with the development of the Kogan Hydrogen Demonstration Plant (KH2DP) located at CS Energy's Kogan Creek Power Station. The KH2DP electrolyser is to be powered by renewable electrical energy at a co-located solar farm with the solar farm utilising BESS, and is to deploy a hydrogen fuel cell.
See: CS Energy website; IHI Corporation website
On October 13, 2021, it was announced that CleanCo Queensland (Queensland Government owned renewable energy corporation) had signed an agreement with Sumitomo Corporation to join in the development of Green Hydrogen production capacity in Queensland.
On October 12, 2021, French President Emmanuel Macron outlined plans to invest €30 billion (USD 35 billion) in the development and support of French corporations to become champions and lead in innovation. To President Macron it is necessary to "… wage the battle of innovation and industrialisation at the same time … to re-industrialise" France.
In addition to the development of the hydrogen industry in France, the package will allow the development of smaller scale nuclear reactors, providing renewable electrical energy, and the means to the production of hydrogen from that energy or steam from that energy, or both.
As will be apparent from the Ashurst Hydrogen Rainbow (see above) the use of nuclear electrical energy to electrolyse water to produce hydrogen is said to give rise to Pink Hydrogen, and the use of steam arising from cooling in the context of nuclear energy gives rise to Purple Hydrogen.
See: French Government website
On October 12, 2021, VoltH2 announced that it is to commence construction of a 25 MW Green Hydrogen production facility. The Green Hydrogen production facility is to be located in the North Sea Port of Vlissingen, is capable of producing 3,500 metric tonnes per annum (mtpa) of Green Hydrogen, and is scalable on modular basis up to 100 MW and 14,000 mtpa.
As is the case with many other Green Hydrogen production facilities (and Blue Hydrogen production facilities for that matter), the facility is located in an industrial area / carbon cluster, in proximity to high-voltage power and gas transmission and distribution infrastructure, and adjacent to the European Hydrogen Backbone.
See: VoltH2 website
Edition 28 of Low Carbon Pulse reported that New South Wales (NSW), Australia's most populous State, has released a report entitled Development of a hydrogen industry in New South Wales on September 30, 2021.
On October 13, 2021, the recently appointed Premier of NSW, Mr Dominic Perrottet, outlined a AUD 3 billion hydrogen strategy for the State of New South Wales. (The September Report on Reports will consider the report and the hydrogen strategy for NSW.)
On October 14, 2021, it was reported widely that Air Products is to develop a USD 4.5 billion Blue Hydrogen Clean Energy Complex (BH2CEP).
The BH2CEP was announced jointly by Governor of Louisiana, Mr Jon Bel Edwards, and Air Products Chair, Chief Executive Officer and President, Mr Seifi Ghasemi.
Air Products is to build, own and operate BH2CEP that will produce Blue Hydrogen, with the Blue Hydrogen to be supplied to customers across Air Products' Gulf Coast hydrogen pipeline network. Key to the BH2CEP will be the CCS of CO2 arising from the use of technology provided by Haldor Topsoe. Air Products and Haldor Topsoes are working together on the NEOM project in KAS, and Haldor Topsoe is providing technology for Air Products Blue Ammonia facility in Texas City (producing 3,600 metric tonnes a day of Blue Ammonia).
As reported in previous edition of Low Carbon Pulse, Air Products is one of the Big Three industrial gas corporations, with Air Liquide and Linde.
On October 14, 2021, Protium announced the development of a 40 MW Green Hydrogen production facility, with the facility to include HESS. The development of the Protium Green Hydrogen production facility adds further to the hydrogen hub forming part of Net-Zero Teesside (See Edition 23 of Low Carbon Pulse).
On October 14, 2021, Octopus Energy and RES announced plans to invest GBP 3 billion by 2030 to develop and deploy Green Hydrogen production capacity across the UK.
Previous editions of Low Carbon Pulse (see Editions 22 and 23 and Edition 28 for most recent coverage) have reported on the commitments made by INEOS (UK based international conglomerate) and PetroChina International, including commitments to capture at least 1 million metric tonnes of CO2 from activities at Grangemouth petrochemical and refining facilities (Grangemouth Facilities) in Scotland.
These activities are significant of themselves, and because of their importance to the Scottish Cluster (see Edition 23 of Low Carbon Pulse), including the Acorn Project. The carbon capture and other initiatives are intended to reduce GHG emissions from the Grangemouth Facilities by 60% by 2030.
As noted in Edition 28 of Low Carbon Pulse, on September 22, 2021, INEOS announced plans to augment the Grangemouth Facilities to allow use of hydrogen as a feedstock and fuel. This augmentation will require the investment of GBP 1 billion. INEOS's stated intention is to progress to NZE by 2045, in line with the policy setting of the Scottish Government.
On October 18, 2021, INEOS announced plans to invest €2 billion (USD 2.3 billion) in the development of Green Hydrogen production facilities across Europe. INEOS announced plans to develop and deploy electrolyser plants across Europe, Belgium, Germany and Norway within the next 10 years, with plants in France and the UK also planned. The first of the electrolyser plants will be a 20 MW electrolyser plant be co-located at INEOS' petrochemical complex at Rafnes, Norway, followed by a 100 MW electrolyser plant at INEOS' existing facilities in Cologne, Germany.
On October 19, 2021, it was reported that Hy Stor Energy has plans to develop a Clean Hydrogen Hub, working with Connor, Clark & Lunn Infrastructure. It is proposed that the MCH2H produce 110,000 metric tonnes (mt) per annum (mtpa) of hydrogen (or 110,000,000 kilograms). It is understood that up to 70,000 mt of hydrogen will be stored in salt caverns. As noted in previous editions of Low Carbon Pulse, the storage of hydrogen will be key to its use.
On October 20, 2021, Air Liquide increased its stake in H2V Normandy, renaming it Air Liquide Normand'Hy, so as to accelerate the 200 MW Green Hydrogen production facility at Port-Jerome, using a proton-exchange membrane (PEM) electrolyser. The Green Hydrogen production facility is located within the Normandy carbon cluster / industrial basin, with Air Liquide intending to supply Green Hydrogen to industrial customers and to the mobility / transport sector. The Green Hydrogen production facility will connect to Air Liquide's existing hydrogen pipeline network in Normandy.
On October 25, 2021, it was reported widely that the Woodside Energy Limited (leading energy corporation) intends to develop a clean-ammonia production facility (H2 Perth project). The H2 Perth project is to be located in a carbon cluster in an industrial precinct in the southern metropolitan region of Perth, and will produce up to 15,000 metric tonnes of clean-hydrogen a day, with the clean-hydrogen to be used to produce clean-ammonia and hydrogen for export. A final investment decision in respect of the project may be expected in 2024.
On October 25, 2021, H2-view.com, reported that PowerChina International and Oracle Power had signed a co-operation agreement to develop a 400 MW Green Hydrogen production facility in Pakistan. It is understood that the electrolysers at the production facility will source renewable electrical energy from photovoltaic solar and wind sources.
On October 25, 2021, it was reported widely that Aberdeen City Council (ACC) had selected BP as its preferred bidder on its procurement of a Green Hydrogen Hub in Aberdeen, Scotland. It is understood that the first stage of the development of the Green Hydrogen Hub is the development of a Green Hydrogen production facility. ACC has demand for the supply of Green Hydrogen produced at the production facility to enable it to fuel its fleet of Fuel Cell Electric Vehicle technology buses.
On October 29, 2021, ENEOS (leading hydrocarbon importer into, and refiner in, Japan) announced that it is undertaking a study jointly with Fortescue Future Industries to assess the development of a Japan-Australia CO2 free Hydrogen Supply Chain, sourcing CO2 free hydrogen from Western Australia.
As readers of Low Carbon Pulse will recall, ENEOS is active in the development of hydrogen and hydrogen-based fuel supply chains: Edition 27 of Low Carbon Pulse reported that ENEOS and Petronas (the national oil company of Malaysia) signed a memorandum of understanding for the development, jointly, of a clean hydrogen supply chain between Malaysia and Japan; Edition 26 of Low Carbon Pulse reported on the study of a hydrogen and hydrogen-based energy carrier supply chain starting at the Origin Energy Green Hydrogen facility at Gladstone, Queensland, Australia, and terminating at the ENEOS refineries in Japan (with ENEOS considering the use of Green Hydrogen to produce methylcyclohexane (MCH)); and Edition 10 of Low Carbon Pulse reporting on the ground-breaking Hydrogen Energy Supply Chain Project in the Latrobe Valley, Victoria, Australia, in which ENEOS participates with Kawasaki Heavy Industries, Electric Power Development Co., Ltd (J-Power), Iwatani Corporation, Marubeni Corporation, Sumitomo Corporation, A
GL Energy Limited, Shell, and Kawasaki Kisen Kaisha, Ltd (K-Line).
On October 29, 2021, it was reported widely that Linde had signed a memorandum of understanding for the development of a Green Hydrogen production facility as part of the Pecem Industrial and Port Complex (CIPP). As readers of Low Carbon Pulse will recall, up to 12 memorandums of understanding have been signed in respect of the development of infrastructure at CIPP.
Earlier in 2021, FMG (driven on by the force of nature that is its founder, Dr Andrew Forrest, AO), committed to achieving NZE across its Scope 1 and 2 GHG emissions by 2030, if not earlier.
On October 5, 2021, FMG announced its intention to achieve NZE across its Scope 3 GHG emissions by 2040. For those who have worked with Dr Forrest, the apparently impossible becomes the everyday. It has to be said that the world needs a few more folk like Dr Forrest; folk who believe in the need for acceleration, and who have the energy and will to achieve that acceleration.
The Australian Broadcasting Corporation (funded the Federal Government of Australia and its own commercial revenue), reported that FMG's Scope 1 and 2 emissions in 2019/2020 were around 2.2 million metric tonnes (mmt) of GHG emissions. It is estimated that the Scope 3 GHG emissions to June 30, 2021, were 252 mmt, with 246 mmt arising from the production of iron and steel.
|SCOPE OF GHG EMISSIONS|
|Scope 1||GHG emissions arising directly from activities and assets controlled or owned by the corporation.|
|Scope 2||GHG emissions arising indirectly from supply of energy to the corporation, including electrical energy and heat by the corporation.|
|Scope 3||GHG emissions arising indirectly in the supply chain of the corporation, including use of energy.|
On October 29, 2021, it was reported widely, that BlueScope Steel Limited (BSL) and Rio Tinto are to explore the various pathways to low-carbon iron and steel production, focussing on the use of high quality Pilbara iron ore and clean-hydrogen so as to displace the use of metallurgical coal at BlueScope Steel's Port Kembla Steelworks. It is understood that the use of Green Hydrogen (as a clean hydrogen) will be prioritised.
Edition 25 of Low Carbon Pulse reported on BSL's commitment to achieve NZE in respect of its Scope 1 and Scope 2 emissions. BSL was to achieve this NZE commitment using renewable electrical energy, and Green Hydrogen, rather natural gas (CH4), whether alone or blended with hydrogen.
Edition 21 of Low Carbon Pulse reported that Rio Tinto and POSCO had entered into a memorandum of understanding (MoU) to develop, explore, demonstrate and deploy technologies to accelerate the transition of the iron and steel sector to lower, low and no carbon. At that time, Rio Tinto's Chief Commercial Officer, Mr Alf Barros, noted that "The [MoU] … complements Rio Tinto's partnerships with other customers as the industry focus" on Scope 3 emissions. For Rio Tinto, the MoU is a clear demonstration of its commitment to NZE (including in respect of Scope 3 emissions).
On October 7, 2021, Hyundai Mobis announced plans to develop two new fuel cell plants in ROK. It is understood that the two new plants (one west of Seoul towards Incheon, and one at Ulsan), costing USD 1.1 billion to develop, will be operational during 2023. The increased fuel cell production capacity, will provide the means to accelerate the development of the hydrogen economy in ROK and globally.
On National Hydrogen and Fuel Cell Day (October 8, 2021), HMC North America and SH2 announced plans to develop and deploy 48 new hydrogen refuelling stations, and to upgrade 2 more, across the US State of California (Project Neptune). As is becoming increasingly typical, the private sector HMC North America and SH2 is developing Project Neptune with the funding support from Government, in this case the California Energy Commission.
This initiative, combining the means to supply and demand, and allowing efficient development, has become a model globally. (See Editions 17, 23 and 27 of Low Carbon Pulse.)
See: Hyundai Motor Company website; Shell website
On October 8, 2021, h2-view.com reported that global mining giant, Anglo American, the Department of Science and Innovation (DSI), South Africa, the South African National Development Institute (SANEDI), Engie (leading global energy corporation) and Bambili Energy (manufacturer of fuel cell stacks), released the findings from a feasibility study into the development of a hydrogen valley. The feasibility study finds that there is potential for the development of a hydrogen valley along the commercial and industrial corridor between Durban and Johannesburg. The hydrogen valley would have three hubs, Joburg to Pretoria, Durban and Richards Bay, and the Limpopo province centred around the Anglo American Mogalakwena platinum Group metals mine.
One of the dynamics in Australia (noted in previous editions of Low Carbon Pulse) is the forward looking perspective of the Australian private sector and Australian State and Territory Governments.
On October 10, 2021, this was again in evidence. Queensland Government Premier Annastacia Palaszcuk and Dr Andrew Forrest, AO (founder of FMG, parent company of FFI, and chair of FFI) announced the development of an electrolyser manufacturing facility at Aldoga within the Gladstone State Development Area (GEM). As noted above, Plug Power is joint venturing with FMG / FFI, and it appears likely that FFI and projects in which FMG and FFI invest will be one of the cornerstone customers of the joint venture.
See: Queensland Government website; FFI website
On October 10, 2021 it was reported that thyssenkrupp is to scale up electrolyser production to 5 GW a year, from the current 1 GW a year. For all manufacturers of electrolysers these are momentous times, and for thyssenkrupp, leading the H2Giga Flagship, it is as well-placed as any.
See: thyssenkrupp website
On October 12, 2021, energy-storage.news, reported that Koch Strategic Platforms and FREYR Battery have established a joint venture (KFJV) to develop 50 GWh battery cell factories in the US. The KFJV is stated to be considering the use of 24M Technologies' SemiSolid battery technology to achieve higher-energy density. The intention is to progress to development by 2030 to produce batteries for electric vehicles and for energy storage systems.
It has been the plan for a while to include a feature on giga-factories in an edition of Low Carbon Pulse. Given the space and word count taken by outlining trends and matters of policy ahead of COP-26 Editions 25, 26 and 27, and 28 of Low Carbon Pulse have been weighty. A future edition of Low Carbon Pulse will include a feature on both giga factories and charging and refuelling infrastructure.
On October 5, 2021, it was reported widely that the World Bank had released Key Factors For Successful Development of Offshore Wind in Emerging Markets (WB OWF).
The WB-OWF is the work of the Energy Sector Management Assistance Program (ESMAP) of the World Bank, and is intended to provide guidelines for Governments in emerging countries as to how best to develop their resources.
The headline from the WB OWF is that there is up to 16,000 GW of off-shore wind field capacity capable of development globally in emerging markets, with this capacity seemingly located in 48 countries. The split between fixed-bottom and floating is 5,500 GW and 10,100 GW.
On October 6, 2021, it was reported widely that RenewableUk's Project Intelligence team had released a report (OWF Report) outlining the global off-shore wind field project profile. The OWF Report identifies 413 GW of off-shore wind field projects. Click here for the country breakdown in relations to fully operational offshore wind capacity in MW.
[Note: The author of Low Carbon Pulse has not verified the basis for the reported GW of off-shore wind field capacity the subject of the OWF Report, but it appears consistent with the information that the author has read.]
On October 6, 2021, it was reported that the Netherland Enterprise Agency (RVO) is procuring the undertaking of metocean campaigns in respect of two off-shore areas (Lots 1 and 2) in the Dutch sector of the North Sea, within the Ijmuiden Ver Investigation Area (IVIA). The IVIA is one of three off-shore areas identified in the Dutch Offshore Wind Energy Roadmap 2030. The IVIA is 62 kms off the west coast of the Netherlands, having an area of 400 km2. The IVIA has four lots in all, with IVOA I and II to be tendered in to 2023, and IVOA III and IV to be tendered in to 2025.
As noted consistently in Low Carbon Pulse (most recently in Edition 28 of Low Carbon Pulse), Australia has world class off-shore wind resources. As has become typical in the news cycle of each edition of Low Carbon Pulse, another major off-shore wind field project is announced off Australia. On October 8 2021, Alinta (one of Australia's largest integrated energy corporations) announced plans to develop a 1 GW off-shore wind field off the East Coast of Australia and a 300 MW on-shore wind farm in the Pilbara Region of Western Australia.
An article in The Guardian (Australian Edition), entitled "Good seas, good grids and good wind": Australia's tentative first steps towards an offshore wind industry provides a snap shot of the current state of play.
See: Alinta Energy website
On October 7, 2021, ANCAP (the national oil company of Uruguay) and the Ministries of Environment and Industry for Uruguay unveiled a plan for the development of Green Hydrogen production facilities using renewable electrical energy from off-shore wind fields – the H2U Offshore program. It is understood that the current thinking is to schedule a tender by the end of 2023.
See: ANCAP website
Both Denmark and Germany are developing green power islands in their sectors of the North Sea. On October 8, 2021, the New Scientist reported that the UK's National Grid company, the owner and operator of the high-voltage transmission network across the UK, is discussing the development of an energy island. The discussions are said to be three-way, with the National Grid not revealing the other two parties as yet. If the energy island discussions progress, the suggestion is that the renewable electrical energy dispatched from the energy island will match load in the north west region of Europe.
Editions 14, 18 and 21 of Low Carbon Pulse have reported on the off-shore wind field development plans for the Polish sector of the Baltic Sea. Ahead of the commencement of the auction process for the off-shore sea-bed leases, consortiums are starting to come together. On October 14, 2021, Ørsted announced that it was partnering with ZE PAK in respect of the upcoming auction.
See: Ørsted website; ZE PAK website
On October 14, 2021, the Biden Administration announced plans to allow the development of seven off-shore wind fields along the East, Gulf and West Coasts of the US: Gulf of Maine, New York Bight (between Long Island and New Jersey), Central Atlantic, the Carolinas, the Gulf of Mexico, California and Oregon.
On October 18, 2021, offshorewind.biz reported that Lithuania had completed the environment impact assessment in respect of its proposed first off-shore wind field in its sector of the Baltic Sea. Adopting tried and tested project structures, Lithuania intends to develop the proposed off-shore wind field project using contracts for difference, with the obligation to connect resting with the transmission system operator.
Edition 28 of Low Carbon Pulse reported that Falck Renewables (leading Italian renewable energy developer) and BlueFloat Energy (leading off-shore wind developer) had announced that they have entered into a 50:50 joint venture for the purposes developing off-shore wind field (OWF) projects off the coast of Italy.
The first project was the 1.2 GW OWF project off Brindisi (Kailia Energia Project), with projected annual generation dispatch of up to 3.5 TWh.
On October 26, 2021, it was reported widely that the joint venturers are not seeking a permit in respect of a further 1.3 GW of OWF projects off the southern coast of the province of Lecce. For the projects to proceed, authorisations will have to be obtained from the Ministero per la Transizione Ecologica and maritime concessions granted by the Ministero delle Infrastructurre and the Port Authority of the Southern Adriatic Sea.
In addition to other news items covered above in respect of solar and sustainable energy, the following news items may be regarded as noteworthy within the news cycle of this Edition 29 of Low Carbon Pulse.
On October 29, 2021, pv-magazine, reported on the outcome of the fifth round of the Renewable Independent Power Producer Procurement Program (REIPPP).
It is reported that the Department of Mineral Resources and Energy awarded concessions in respect of 25 projects having a combined installed capacity of 2.583 GW, with the projects being within a range of 75 MW to 140 MW. Given the size of the projects, the bids may be regarded as highly competitive, with the lowest bid reported for a 124 MW wind-farm of US cents 2.279 per kWh.
To manage the length of this Edition 29 of Low Carbon Pulse, the usual features on Land Transport (automobiles, buses, trains and trucks) round-up, Ports and Shipping Forecast and Aviation and Airports will be the subject of a standalone special feature.
As noted above, at the end of future editions of Low Carbon Pulse, reports that have been reviewed for the purpose of that edition of Low Carbon Pulse will be listed, by organisation, title / subject matter, and link.
|ORGANISATION||TITLE / SUBJECT MATTER|
|Airbus||Hydrogen: An energy carrier to fuel the climate-neutral aviation of tomorrow|
|BloombergNEF||New Energy Outlook, 2021|
|Euromia Research & Consulting||CCUS Development Pathway for the EfW Sector|
|IEA||Global Hydrogen Review 2021|
|Curtailing Methane Emissions from Fossil Fuel Operations|
|World Energy Outlook 2021|
|Net Zero by 2050 – A Roadmap for Global Energy Sector|
|Achieving Net-Zero Electricity Sectors in G7 Members|
|Phasing Out Unabated Coal – Current status and three case studies|
|IMF||Word Economic Outlook|
|IRENA||A Pathway to Decarbonize the Shipping Sector by 2050|
|World Energy Transitions Outlook|
|James Cook University||The global value of coastal wetlands for storm protection|
|Lancaster University and Small World Consulting||The real climate and transformative impact of ICT: A critique of estimates, trends, and regulations|
|New South Wales Legislative Council||Development of a hydrogen industry in New South Wales|
|S&P Global Platts||Platts Global Integrated Energy Model – Strategic Planning for a world in transition|
|Shell||Exploring the Future of the Voluntary Carbon Market|
|Shell and Deloitte||Decarbonising Aviation: Cleared for Take-off, Industry Perspectives|
|United Nations||UNFCCC NDC Synthesis Report|
|2021 Production Gap Report|
|US EIA||International Energy Outlook|
|World Bank||Key Factors For Successful Development of Offshore Wind in Emerging Markets|
|Wood Mackenzie||How to scale up carbon capture and storage|
|Global Energy Storage Outlook|