Energy in the new era

Egypt's presidency of the UN Climate Change Conference starting in November will focus on climate change adaptation and the technology to enable this, the special representative for COP27 Wael Aboulmagd said Sept. 28, urging countries to put aside differences in what he acknowledged was a testing geopolitical environment. COP27 is seen as a critical meeting to check progress towards the Paris climate agreement to limit global temperature rises to 2 C above pre-industrial levels, and ideally to 1.5 C. However, just 18 countries had so far submitted enhanced nationally determined contributions (NDCs) to set out how they are to reduce emissions further, ahead of a deadline on Sept. 23. Egypt's special representative for COP27 was still hopeful that more countries would enhance their commitments in the coming weeks. Countries are seeking further clarity around the Article 6 rules of the Paris agreement that govern carbon markets. Some developing countries have announced plans to ban the export of domestically produced carbon credits, to ensure they have enough carbon offsetting capacity to meet their own NDCs. COP27 could set out more detail on how the use of voluntary offsets by companies will be treated. Platts, part of S&P Global Commodity Insights, assessed CORSIA-eligible credit prices at $4.15/mtCO2e Sept. 28, down from an all-time high of $8.72/mtCO2e on Nov. 23, 2021. India and Indonesia are among countries already planning to impose carbon credit export bans, with more countries expected to follow suit. Strained negotiations Aboulmagd said the war in Ukraine would have a direct impact on negotiations, acknowledging the food and resource stress that has resulted from the conflict in Europe, and the strains it puts on climate diplomacy between the major world powers. However, Russia's invasion of Ukraine must not be used as an "pretext for backsliding" on climate commitments, he said in a press briefing ahead of COP27 which starts in Sharm el-Sheikh on Nov. 6. The challenges to progress on climate accords were reducing emissions fast enough, limited progress on adaptation and a persistent funding gap, Aboulmagd said. Countries must now move from negotiation to implementation, and from pledges to action, he said. Debt in developing countries must also be addressed, he added. Developing countries had the least historic responsibility for CO2 emissions and were already suffering the worst effects of climate change, he said. As such, finance for adaptation, loss and damage must include concessional finance and grants, not just loans, he said. Just 6% of funding was in the form of grants, and not all of this was for developing countries, he added. Aboulmagd said there were already "bankable" models for financing CO2 reductions, such as renewable energy sources, and emissions reduction technology. Financing, particularly from philanthropies, should focus on adaptation and the technology to enable this, he said, noting climate change was already a reality the world would have to live with. Philanthropies should not "follow what private money is doing," he said. Instead, they should be strategic and aim to unlock new technology and provide financing for smaller businesses. The negotiations between parties at COP27 was only part of the process, Aboulmagd said, noting that initiatives outside the formal negotiation process, such as the "race to zero" campaign supported by businesses and cities, were also critical to meeting climate goals.

A ban on the exports of carbon credits announced by India's Minister for Power and New and Renewable Energy R K Singh Aug. 8 has led carbon credit buyers to pay less for credits issued by India than other countries, market sources said. The minister did not specify when the ban will go into effect and the credits that will be affected. The trend is particularly evident in the renewable energy sectors of the voluntary carbon markets. India is one of the world's biggest producers of carbon credits issued by renewable energy power plants. Other producers include Turkey, China, and Latin America. Market players are concerned that credits issued by Indian projects will struggle to find domestic buyers when the ban is implemented and probably have to be sold at a lower price. "With the statement by the minister, the market for Indian credits has been very affected," an Indian based developer said. "Clients are bothered about the ban and are avoiding credits from India." A Europe based marketer and developer said that the ban puts Indian carbon credit exports at risk. "Every risk has to be matched up with price," the developer said. Market sources said, at the end of September, Verified Carbon Standard-certified solar and wind credits issued by India were at a $1/mtCO2e discount to equivalent credits issued by Turkey. The Turkish premium is likely attributable to lower supply in Turkey compared with India, an India-based developer of renewable energy carbon credits said. Renewable energy credits issued by China have always traded at a discount to Indian and Turkish equivalents due to high volumes produced in China and integrity concerns. Renewable credits sourced from Latin America have always traded at a premium to India and Turkey due to a lack of supply.

You're committed to a low-carbon future. Getting there is as critical as it is complicated. For residual emissions that can't be reduced with today's technology, efficiency gains, and fuels options, the world turns to offsetting.Fortunately, the voluntary carbon market infrastructure now includes transparent, liquid spot and futures markets, and robust market data to enable market participants to model, trade, and hedge their emissions exposures with clarity and confidence.  S&P Global Commodity Insights together with Xpansiv and CME Group came together recently with our Navigating the Voluntary Carbon Markets Trade Ecosystem Webinar to provide you with deep insight into how the voluntary carbon market is evolving and will continue to grow in the coming yearsWatch this video series today if you're interested in turning your commitments into carbon action as we provide a clear path to progress toward your net-zero goals.Topics discussed:The role of price transparency in Voluntary Carbon Markets - Paula Vanlaningham, Global Head of Carbon, S&P Global Commodity InsightsScaling Up: Current Market Trends and How New Standardized Contracts are Reshaping Voluntary Carbon Markets - Rene Velasquez, Head of Global Carbon, Xpansiv Market CBLManage climate risk using voluntary carbon offset futures - Peter Keavey, Global Head of Energy and Environmental Products, CME Group

Voluntary carbon markets have seen significant growth in recent years and are expected to surge in the years ahead. But they have traditionally been seen as opaque, complex and niche. That is rapidly changing as a large range of companies start to engage with them.In the latest Platts Future Energy podcast, Jonty Rushforth is joined by Paula Vanlaningham and Jeff Berman to discuss the ‘beauty' of carbon credit markets.

As the US ethanol industry pursues carbon capture and sequestration projects, producers are looking at the effects of lower carbon intensities in markets with low carbon fuel standards and in future industries like sustainable aviation fuel produced from ethanol. The voluntary carbon credit market for technology-based carbon capture could also attract interest given high prices but hurdles could keep ethanol producers focused on regulated markets. S&P Global Commodity Insights' Americas biofuels manager Josh Pedrick talks through the evolving CCS interest in US ethanol with low-carbon lead Arsalan Syed and biofuel analytics manager Corey Lavinsky. This Future Energy podcast was produced by Felix Fernandez in London.More listening options:

Workshop — Voluntary Carbon MarketsModerated By: Paula Vanlaningham, Global Head of Carbon Silvia Favasuli, EMEA Editor, Carbon Michael Evans, EU/UK Compliance Analyst Deb Ryan, Head of Low Carbon Market Analytics

In this episode of the Platts Future Energy podcast, Varaleka Pant and Arsalan Syed discuss with Deb Ryan the importance of evaluating the carbon intensity for crude and some of the major global crude grades, and explain the need for standards in this space to ensure consistency in low carbon crude trading.More listening options:Explore and identify low-carbon crude grades with our Periodic Table of Oil™

Texas is one of the largest emitting states in the US and stands to become ground zero of the carbon management industry. But unlike other states, Texas law provides no clarity on ownership rights of pore space -- the empty underground cavities where companies can pump and permanently store captured CO2. While surface rights and mineral rights are crystal clear, Texas hasn't defined who owns those underground pore spaces. Carbon Neutral Coalition Executive Director John Colyandro joined S&P Global reporter Brandon Mulder on the podcast to share his insights on the issues surrounding pore space ownership, how it could be holding back the industry, and ways it could be resolved in the upcoming legislative session. Stick around after the interview for Jeff Mower with the Market Minute, a look at near-term oil market drivers.Related content:Texas seeks regulatory authority from EPA over CO2 injection wells45Q, financial uncertainties hinder capital flow for CCS deployment: panelS&P Global Market Intelligence: Natural gas plants with carbon capture could save industry billions – think tankMore listening options:

Hydrogen's role in long-distance transmission of energy amid concerns about energy security from the pandemic and Russia's invasion of Ukraine, the impact of rising inflation on projects and how subsidiarity can help with shifting regulatory constraints are among the topics discussed by Daryl Wilson, Executive Director of the Hydrogen Council, in conversation with Beth Evans, Global Director of News with S&P Global Commodity Insights. 

Australia has accelerated its climate ambitions with a new commitment to cut emissions by 43% by 2030, which translates into having about 82% renewable power in its energy mix. Alongside that, the 2019 National Hydrogen Strategy aims to position the country as a top global exporter of the energy carrier. Demonstrations, pilot projects and hubs are being developed around the country, such as the first international pilot to export hydrogen.In this episode of the Platts Future Energy podcast, Ruchira Singh discusses the contours of the Australian government's climate policy measures, and the considerations around hydrogen for the nation's decarbonization journey with Mendo Kundevski, Ankit Sachan and Anton Ferkov.Price assessments featured in this episode:Hydrogen Western Australia SMR with CCS (inc. CAPEX) A$/kg(HYAAZ00)Hydrogen Western Australia Alkaline Electrolysis $/kg (HYAES00)Hydrogen Queensland PEM Electrolysis (inc. CAPEX) $/kg (HYABR00)Hydrogen South Australia PEM Electrolysis A$/kg (HYABW00)Japan Hydrogen Alkaline Electrolysis (incl CAPEX) $/Kg (IGYFU00)More listening options:

September 20-21, 2022 | 8:00 am - 15:30 pm CEST Novotel, Amsterdam City, NetherlandsCreating building blocks for Hydrogen to take off as its own marketIn a rush to replace Europe's dependence on Russian Oil and Gas, the drive for Hydrogen has never been stronger. This year's event looks to answer two big questions: can Hydrogen ensure Europe's energy independence and if it can, how can we grow demand for Hydrogen enabling global scale up? With the price of electrolyzers and renewable energy increasing, now is the time to scale up on Hydrogen volume to lower the costs. Join this year's Hydrogen Market's Europe Conference to find out how we can get there.S&P Global Commodity Insights are delighted to announce our Hydrogen Markets Europe Conference, 2022, as part of the global move to launch a Hydrogen economy. This event is part of a global series organized by S&P Global Commodity Insights with parallel events in the US and Asia and attendees will include hydrogen producers, midstream natural gas companies, infrastructure investors, developers, electric power companies, regulators, and policy-makers, among many others.REGISTER NOW

What are Platts Hydrogen Assesments? See Factsheet for more Hydrogen Assessment Information >Building on the world's first-to-market hydrogen assessments launched in December 2019, we expanded in April 2020 on our North American and European assessments and launched its first hydrogen assessments in Asia, following by adding Australian pricing in August 2021.Our daily price assessments include 10 US regional set of prices, one Canadian set of prices, prices in the Netherlands, Japan and the UK.The daily price assessments demonstrate the production cost of hydrogen for Steam Methane Reforming (SMR) production methods, including some regions Carbon Capture and Storage (CCS), along with prices for Proton Exchange Membrane (PEM) Electrolysis, Alkaline Electrolysis, Auto Thermal Reforming (ATR), Coal Gasification and Lignite Gasification production pathways, depending on the production hubs.The calculated prices reflect both the commodity production cost and the capital expenditure (CapEx) associated with building a hydrogen facility.The assessments include a commodity price as well as a commodity plus production cost, for the following hydrogen production hubs:Canada— Alberta (SMR w/o CCS, Alkaline Electrolysis, PEM Electrolysis, excluding and including CapEx)United States(SMR w/o CCS, Alkaline Electrolysis, and PEM Electrolysis, all excluding and including CapEx)— Appalachia— Gulf Coast— Midcontinent— Northeast— Northern California— Northwest— Rockies— Southeast— Southern California— Upper MidwestThe Netherlands— SMR w/o CCS— SMR with CCS— PEM Electrolysis— Alkaline ElectrolysisJapan— SMR w/o CCS— PEM Electrolysis— Alkaline ElectrolysisUnited Kingdom(all include and exclude CapEx)— ATR with CCS— PEM Electrolysis— Alkaline ElectrolysisAustralia(all are published in A$/kg, $/MMBtu, $/kg, both including and excluding CapEx)— New South Wales - Coal Gasification w/CCS, PEM Electrolysis, Alkaline Electrolysis— Queensland - Coal Gasification w/CCS, PEM Electrolysis, Alkaline Electrolysis— Victoria - Lignite Gasification w/ CCS, PEM Electrolysis, Alkaline Electrolysis— Western Australia - SMR w/ CCS, PEM Electrolysis, Alkaline Electrolysis— South Australia - PEM Electrolysis, Alkaline Electrolysis— Tasmania - PEM Electrolysis, Alkaline ElectrolysisMiddle East— Saudi Arabia - PEM Electrolysis, Alkaline Electrolysis, SMR w/ CCS— UAE - PEM Electrolysis, Alkaline Electrolysis, SMR w/ CCS— Oman - PEM Electrolysis, Alkaline Electrolysis, SMR w/ CCS— Qatar - PEM Electrolysis, Alkaline Electrolysis, SMR w/ CCS

LAUNCH REPORT

When Putin invaded Ukraine in February, the industry wondered whether it would set back Europe's ambition to develop a low-carbon hydrogen market. Already, we have seen quite the opposite. The EU member states and other countries are doubling down on clean energy commitments, with hydrogen at their heart.S&P Global Commodity Insights' James Burgess discusses recent developments with pricing specialist Jeff McDonald and analyst Matthew Hodgkinson.Learn more about our Hydrogen Markets Europe Conference in Amsterdam this September on: https://plattsinfo.spglobal.com/HydrogenMarketsEurope2022.htmlTell us more about your podcast preferences so we can keep improving our shows. Take our two-minute survey here: https://bit.ly/plattspod22More listening options: