Green Markets is a daily series dedicated to highlighting events of interest that could impact investments within environmental markets.
Biofuels/Chemicals
Shell has warned investors of an impending impairment charge of up to $2 billion due to halting work on Europe's largest biofuel project and selling a Singapore refinery. The company expects a non-cash writedown of between $600 million and $1 billion in its second-quarter results because of issues with the Rotterdam biofuel project, which has faced technical delays. Additionally, Shell anticipates a loss of between $600 million and $800 million from the sale of its Singapore refining and chemicals hub.
SABIC Agri-Nutrients Company has received approval from Saudi Arabia's Ministry of Energy for feedstock allocation to establish a blue (low carbon) ammonia project in Jubail Industrial City. This plant will produce 1.2 million metric tons per annum (MMTA) of blue ammonia and 1.1 MMTA of urea and specialized agri-nutrients.
Carbon Capture
Running Tide, a carbon removal startup known for its ocean-based carbon capture technology, is shutting down after failing to secure additional financial backing. Despite securing 25 customers, including Microsoft, Shopify, and Stripe, the company could not attract the necessary funding to scale up its operations. CEO Martin Odlin announced the closure on LinkedIn, citing insufficient demand in the voluntary carbon market to support large-scale carbon removal projects.
Voluntary Carbon Markets (VCMs)
Over 80 nonprofits, including ClientEarth, ShareAction, Oxfam, Amnesty International, and Greenpeace, are renewing their opposition to the market for carbon credits. These groups argue that carbon offsets undermine genuine net-zero efforts and are calling for their exclusion from climate regulations and guidelines.
Liquified Natural Gas (LNG)
Abu Dhabi National Oil Company (ADNOC) has designated a 40% stake in its Ruwais liquefied natural gas (LNG) project to Shell, TotalEnergies, BP, and Japan's Mitsui, with each company receiving a 10% stake. The project aims to more than double the UAE's LNG output, producing about 9.6 million metric tons per annum (mtpa) by late 2028.
Recycling Technology
In Serbia, a 103 MW waste-to-energy facility at the Waste Management Center in Vinča has officially started operating on July 1st. Local firm Beo Čista Energija is rehabilitating the old landfill and constructing a new one near Belgrade. The facility began waste incineration in February 2023 during its final testing phase and is now fully operational under a public-private partnership with the City of Belgrade.
Renewable Energy
South Africa's new environment minister, Dion George, aims to expedite the country's use of billions of dollars in climate finance to boost renewable energy development. His primary focus will be on implementing the $9.3 billion Just Energy Transition Partnership (JETP) with wealthy nations, accelerating the construction of renewable energy plants, and connecting them to the national grid.
Investment
The climate tech sector is facing a funding crunch, particularly for growth-stage companies aiming to scale up commercial operations. Investment dropped 20% in the first half of 2024 compared to the previous year, with growth-stage startups receiving significantly less funding. Investors are hesitant due to the high risks associated with emerging technologies like advanced nuclear and hydrogen, preferring more established sectors like solar and wind. Despite these challenges, startups with clear paths to revenue generation and commercial scale, such as Fervo Energy and Sila Nanotechnologies, continue to attract significant investments in the sector. The age of higher interest rates and shrinking political support is starting to take its toll on unproven business models.