Green Markets - June 18, 2024
News in environmental markets.
Green Markets is a daily series dedicated to highlighting events of interest that could impact investments within environmental markets.
Government/Regulatory
The Californian government is set to propose a new $10B climate resilience bond in the November 2024 ballot. If approved, this would be the largest voter-approved climate investment in U.S. history. Its key proposals are listed below, from ESG News:
Increase access to safe drinking water and enhance flood protection.
Improve wildfire prevention and forest health.
Restore wetlands, reintroduce salmon, and improve habitat connectivity.
Boost community resilience to extreme heat events.
Protect and restore coastal and tidal habitats.
Incentivize farmers and ranchers to improve soil health and carbon sequestration.
Expand the Equitable Building Decarbonization Program for air quality and renewable energy projects.
Battery Metals
Italy is set to adopt new legislation to boost the procurement and reuse of critical raw materials, simplifying the permitting process for mining concessions. This is just another addition to a long line of countries seeking to reduce their reliance on the Chinese supply of raw materials.
Biofuels/Chemicals
Comstock and RenFuel have amended an agreement to develop RenFuel’s pre-existing biorefinery project at a pulp and paper mill in Sweden. The amendment expands the partnership's scope to additional European markets.
Bharat Petroleum Corp, an Indian state-owned O&G company, is planning to start producing sustainable aviation fuels in its three refineries.
Solugen, a bio-based chemicals technology developer, has received a $214M loan guarantee from the U.S. DOE to construct a new organic acids production facility in Minnesota.
OXCCU, a climate-tech startup, and px Group, an engineering and construction firm, are teaming up to build a new SAF demonstration plant in the U.K.
Carbon Capture
CORMETECH and Ozona CCS have entered into a memorandum of understanding (MoU) to construct and operate a full-scale carbon capture system capturing carbon dioxide from flue gas via natural gas engines. The project is expected to be operational by the end of 2025.
Equatic, a carbon capture startup, has commenced engineering work on its first large-scale commercial carbon dioxide removal (CDR) plant in Canada. This is through a partnership with CDR developer Deep Sky.
Piñon Midstream has received approval from the U.S. EPA for its MRV plan to sequester carbon dioxide at its two acid gas injection wells in Lea County, New Mexico.
GRTgas and Equinor have signed an agreement to develop a carbon capture and transport project in the North Sea. Description from Energy News:
The network will include a 30 km onshore pipeline to transport the captured CO2 to a compressor station. The CO2 will then be transported via an offshore pipeline to safe geological sequestration sites under the sea off Norway. The project, scheduled for 2029, is part of France’s 2030 carbon capture and storage (CCUS) strategy.
Voluntary Carbon Markets (VCMs)
Microsoft has entered the largest CDR transaction ever with BTG Pactual Timberland Investment Group. The firm expects to receive 8M carbon credits from BTG Pactual’s $1B reforestation efforts in Latin America.
Grosvenor Partner and Terraformation have partnered to sell carbon credits from reforesting mangroves in Ghana. The partnership will deliver 15,000 tons of carbon credits by 2030.
Kita, a carbon market insurance provider, has announced the first-ever insurance policy on carbon market buffer pools, in coordination with Wilder Carbon.
A carbon credit buffer pool is a defined percentage of the total carbon credit output a carbon project generates that needs to be saved in case of carbon leakage. In the scenario that some carbon credits are invalidated from a project, the buffer pool acts as additional supply that can replace those credits.
Electric Vehicles
Fisker (FSRN), a prominent electric vehicle startup, has filed for bankruptcy protection. Supply chain issues and rapid capital expenditures have led to the company’s ultimate failure.
Polestar is expanding into seven new global markets to expand its retail footprint. The company is looking for local distribution partners in France, the Czech Republic, Slovakia, Hungary, Poland, Thailand, and Brazil.
Energy Efficiency
The US energy storage sector has reached a total capacity of 1,265 MW of storage deployed across all segments. This represents an 84% increase from Q1 2023. While this is a year-over-year increase, storage capacity dropped 29% in comparison to Q4 2023.
The California Energy Commission has approved nearly $27M of funding for three energy storage projects in development by Redflow, RedoxBlox, and Noon Energy.
BASF, a global battery materials and recycling giant, has entered an agreement with WHW Recycling to process cathode and anode waste.
Lithion Technologies has begun operations at its new commercial-scale battery recycling plant in Canada. The company plans to expand its total capacity to around 20,000 tonnes of material per year.
Hydrogen
Mitsubishi and Eneos Corporation have signed a memorandum of understanding (MoU) to study the implementation of hydrogen and other decarbonized fuels. This partnership expands on an ongoing feasibility study into sustainable aviation fuels (SAF) fuels.
ACWA Power and Sinopec Guangzhou Engineering have signed a memorandum of understanding (MoU) to collaborate on green hydrogen and green ammonia projects in the Middle East, North Africa, Central Asia, and Southeast Asia.
Towngas, a Hong Kong and Chinese gas company, is entering a partnership with Veolia, a French waste and energy group, to build Hong Kong’s first green hydrogen project. It will convert biogas from a nearby landfill into more sustainable fuels.
Technology company Wärtsilä Energy has developed and launched the first 100% large-scale hydrogen engine power plant. The system can also use natural gas, so these engines can be used until hydrogen is available, if it isn’t already.
Liquified Natural Gas (LNG)
Shell, an O&G giant, has finalized its acquisition of Pavilion Energy’s assets from Temasek to solidify its position in the LNG market. This move has increased Shell’s LNG capacity by approximately 10%.
Recycling Technology
Solvay and Cyclic Materials have signed an agreement to supply mixed rare earth oxide for Solvay to begin recycling, beginning in late 2024.
Renewable Energy
Germany’s solar power installation numbers are up 35% year-over-year for the first four months of 2024. New solar capacity has grown by more than 5 GW so far this year.
Vestas, a wind turbine manufacturer, has secured a conditional agreement to supply wind turbines to BASF’s Nordlicht 1 and 2 offshore wind projects.
Hydro Quebec just signed a 30-year power purchase agreement for 150 MW of wind power from a project led by Pattern Energy, part of the company’s $22B plan to tripe wind capacity by 2035.
British rail sector pension fund Railpen has acquired a 50% stake in renewable energy developer AGR Power. Under this arrangement, Railpen will contribute capital to AGR’s new solar power, battery storage, and greenhouse projects.
African Infrastructure Investment Managers (AIIM), a $2.8B African private equity fund, is in talks with BlackRock to sell its stake in its renewable energy business.