After a period of open consultation, S&P Global Platts will make several changes to its hydrogen assessments that will refine its treatment of capital expenses,…
Feb 16, 2021
After a period of open consultation, S&P Global Platts will make several changes to its hydrogen assessments that will refine its treatment of capital expenses, as well as adjust some operational parameters of the various production pathways.
These changes stem from Platts’s quarterly methodology review of its hydrogen assessments, as well as industry feedback and a review of the assessment methodology by an independent energy consultant. Chief among these changes is the adoption of a fixed charge rate for the calculation of capital expenses, which is the product of a capital recovery factor and a project finance factor. This change will more accurately incorporate inflation, depreciation, return on equity, debt service, insurance as well as income and property taxes.
In addition, the capital costs ($/KW) for the electrolysis production pathways proton exchange membrane (PEM) electrolysis and alkaline electrolysis will be increased, from $900/KW for PEM electrolysis to $1,382/KW; and from $702/KW for alkaline electrolysis to $891/KW. These changes will more closely align with the technology-specific capital costs listed in the International Energy Agency’s 2019 Future of Hydrogen report (IEA FoH).
This change will directly affect the Netherlands and US Gulf Coast electrolysis assessments, and indirectly affect Japan and the remainder of the North American electrolysis assessments.
Other changes include an adjustment for plant efficiencies, based on technology-specific assumptions listed in the IEA FoH report, as follows: steam methane reforming (SMR), from 70% to 76%; SMR with carbon capture (CCS), from 63% to 69%; and alkaline electrolysis, from 65% to 66.5%.
The cost of stack refurbishment as a percent of capital cost will also be increased from 15% to 35% for PEM electrolysis, and from 15% to 45% for alkaline electrolysis, based on technology-specific production costs cited in the IEA FoH report.
Platts will also adjust the percentage of Dutch peak and base electricity prices used in the Netherlands hydrogen assessments from the current 80% base and 20% peak, to 50% peak and 50% base.
In addition, Platts will change its method for calculating carbon dioxide emissions, with relevance to the Netherlands (SMR, and SMR w CCS) and California (SMR) assessments, by using the emission factor of 8.9 kg CO2/kg H2, as listed in the IEA FoH report.
Finally, Platts will adjust the cadence of its methodology review from quarterly to annual, to accommodate the annual release of the US National Renewable Energy Laboratorys Annual Technology Baseline report, which contains a number of the financial assumptions used in the revised hydrogen methodology as proposed.
The changes will take effect on April 1, 2021.
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LONDON, Feb. 22, 2021 /PRNewswire/ — S&P Global Platts (“Platts”), the leading independent provider of information and benchmark prices for the commodities and energy markets,…
Feb 22, 2021
Silvina Aldeco Martinez, Chief Product Officer, S&P Global Platts said: “The global Energy Transition presents major challenges for today’s business leaders. Changes in policy, technology and consumer preferences will determine vastly different levels of supply and demand across multiple commodity markets. These factors combined with the threat of climate change could present a dramatic opportunity or a catastrophic business risk for various market participants. With over 15 years history in the low carbon and renewables energy space, S&P Global Platts offers clients the insights they need to navigate the market shifts associated with the Energy Transition through a seamlessly integrated offering to help users make strategic investments decisions and manage risk”.
Key elements of the Energy Transition offering on The Platts Platform include:
– Future Energy Outlooks: Market leading insights from S&P Global Platts Analytics into the future of energy covering all energy sources and regions, providing outlooks covering emissions, alternative transport, hydrogen, power storage, renewables as well as policy & technology tracking by sector.
– Global Integrated Energy Model: Analysis of future energy demand and supply from S&P Global Platts Analytics that models 143 countries across nine sectors and 30 fuel types with historic data spanning 30 years and forecasts through to 2040.
– Energy Transition Price Assessments: S&P Global Platts market leading benchmark prices including market-first hydrogen price assessments, European Guarantees of Origin and more.
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Stan Guzik, Chief Technology & Innovation Officer at S&P Global Platts added: “Building on our vision to help power the commodity markets of the future, the integration into the Platts Platform of unmatched Energy Transition pricing data, proprietary forecasts and contextual News will help our customers know today’s energy transition so they can shape tomorrow”.
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London — S&P Global Platts has announced a partnership with environmental investment company Viridios Capital to use artificial intelligence to bring transparency to the voluntary…
Feb 24, 2021
The move aims to drive price transparency in the rapidly-growing market for greenhouse gas emissions credits — particularly where projects deliver benefits that are additional to the underlying emissions reductions.
“The complex voluntary carbon markets are evolving at a rapid rate,” said Jonty Rushforth, head of price group at Platts, in a statement Feb. 24.
“Combining Platts robust and trusted price assessment data insight alongside Viridios Capital’s proven environmental AI technology will provide market participants with greater transparency into the market value of voluntary carbon credits and their associated co-benefits,” he said in a statement.
The co-benefits relate to 17 United Nations Sustainable Development Goals, for example gender equality, clean water and biodiversity.
Carbon credits are generated by specific projects that avoid, reduce or remove greenhouse gas emissions, and are verified and validated by a set of independent standards that have been created by coalitions of non-governmental organizations and market participants over the last few decades.
The large number of differentiating factors associated with emissions reduction or removal projects — such as project technology, geography and the UN’s SDGs — present significant challenges in determining the value of the credits they generate.
A robust AI-modelled approach will bring a new level of clarity to voluntary carbon market participants, Platts said.
The two companies signed a memorandum of understanding that will involve a series of AI-driven carbon indices to enhance transparency into the co-benefits that projects deliver, providing market participants with a greater understanding of their market value.
The new indices will leverage environmental AI expertise provided by Viridios Capital, which has been trained on over 20,000 data points representing transactions from across the range of carbon projects around the world.
The model will also include daily inputs from a range of Platts price assessment data to produce evaluations for sets of credits with specified co-benefits including project types, vintages, locations and standards.
The new indices will complement Platts’ growing suite of voluntary carbon price assessments including the Platts CEC, launched in January 2021, which reflects the daily value of CORSIA-eligible carbon credits from the UN’s global aviation carbon offsetting program.
Global demand for carbon offset credits is expected to increase significantly as a growing number of companies and governments are setting targets to cut greenhouse gas emissions to net-zero by 2050.
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