Green Markets - August 16, 2024

Aug 17, 2024

Green Markets is a daily series dedicated to highlighting events of interest that could impact investments within environmental markets.

SpaceX is set to launch the Tanager-1 satellite, developed by Carbon Mapper and Planet Labs PBC, to track methane emissions from specific sources like oil wells and landfills. This satellite, funded by Bloomberg Philanthropies and other donors, aims to identify and monitor "super emitters" of methane. The data collected will help enhance oversight and accountability for significant methane sources.
The EPA is moving forward with disbursing funds from the Inflation Reduction Act’s $27 billion "Green Bank," including $14 billion for the National Clean Investment Fund and $6 billion for the Clean Communities Investment Accelerator, which are available immediately for climate-friendly projects. The $7 billion Solar for All program will release some of its funds now, with the remainder accessible next year after finalizing work plans. Despite Republican efforts to repeal this funding, the disbursement process could make such actions more challenging.
The Biden-Harris Administration has announced a $775 million investment to help 21 states clean up orphaned oil and gas wells, part of the broader Investing in America agenda. Through the Bipartisan Infrastructure Law, this funding primarily aims to reduce methane emissions. Since the law's enactment, over $1 billion has been distributed to plug more than 8,200 orphaned wells. The new funding will advance these efforts further:

BHP's Escondida copper mine in Chile has reached an agreement with its main union, suspending a strike that began over a wage dispute. The deal includes a sweetened offer from BHP, which increased worker bonuses to around $32,000 plus an additional $2,000 in soft loans. The strike had driven up copper prices, but the agreement is expected to stabilize the market.

Be8 has started constructing an ethanol plant in Rio Grande do Sul, Brazil, with a planned annual production capacity of 220 million liters. This versatile facility will produce both anhydrous ethanol for mixing with gasoline and hydrated ethanol for direct use, with operations set to begin in 2026. Funded by R$729.7 million from Brazil’s National Bank for Economic and Social Development, the plant will produce bran for animal feed, gluten for human consumption, and generate electricity from biomass.
The renewable fuel industry is shifting as many established projects are canceled, primarily due to high costs, with major firms like BP and Shell being recent examples. From September 2023 to July 2024, nearly 1 billion gallons per year of planned capacity were paused or abandoned, while almost 2 billion gallons per year of new projects emerged. Many of these new projects involve power-to-liquid technologies, which produce e-fuels from green hydrogen and CO2 capture, avoiding issues with biogenic feedstock supply. The new projects increasingly focused on sustainable aviation fuel (SAF) rather than renewable diesel.

Rivian has temporarily suspended production of its electric delivery vans for Amazon due to a parts shortage but expects to recover the lost output. The company did not provide details on the specific part or supplier involved. The halt does not impact the production of Rivian's other vehicles, such as the R1S SUV and R1T pickup. Amazon, Rivian's largest investor, acknowledged the issue but does not expect significant consequences for its operations.

FortisBC has signed an agreement with VulcanX Energy to develop hydrogen pyrolysis technology, which will produce zero-emission hydrogen and solid carbon from natural gas. VulcanX, which spun out from the University of British Columbia, will use the funding for the engineering and design of a facility to produce up to one tonne of hydrogen per day.

Related Stock List(s): Hydrogen Stocks

Spain's Cepsa has agreed to sell its liquefied gas division, Gasib, in Spain and Portugal to a subsidiary of Chile's Empresas Copec for 275 million euros ($302.42 million). This sale aligns with Cepsa's strategic shift toward low-carbon businesses, where it plans to invest up to 8 billion euros by 2030.

Related Stock List(s): LNG Stocks

Sweden is considering borrowing up to $28.5 billion to finance a new fleet of nuclear reactors. The proposed model includes government borrowing and a 40-year contract-for-difference (CfD) to guarantee revenue for investors, inspired by the Czech Republic’s financing approach. The plan would involve funding up to 6,000 MW from new reactors, with the government covering 75% of investment costs.

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