Green Markets - September 25, 2024

Sep 26, 2024

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

A recent Morningstar survey revealed that over two-thirds of asset owners believe ESG factors have become increasingly material to their investment processes, with 67% reporting heightened importance over the past five years. The survey, which involved 500 asset owners managing $18 trillion in assets, indicated that APAC investors showed the highest increase in ESG materiality at 71%. In response to this trend, asset owners have allocated an average of 42% of their assets to ESG-focused strategies.
In her opening speech with Canadian Prime Minister Justin Trudeau, EU President von der Leyen stressed the importance of carbon pricing in combating climate change. She highlighted the success of the EU's Emissions Trading System (EU ETS), which has reduced emissions by 50% while generating over €200 billion in revenues that were reinvested into climate initiatives. Von der Leyen reiterated calls for a global carbon price. She also advocated for creating a market for "nature credits" to reward environmental restoration efforts.

Drax plans to invest up to $12.5 billion in developing biomass power plants with carbon capture and storage (BECCS) in the United States over the next decade. While maintaining its commitment to the UK, Drax sees significant opportunities for its BECCS technology in the US, with its new Houston-based business, Elimini, exploring over 20 potential project sites. The first US project is expected to begin operations by the end of 2030, requiring a $2.5 billion investment.

Related Stock List(s): Carbon Capture Stocks

New York has announced that it will join the Western Climate Initiative (WCI), which will serve as its registry and auction platform for its upcoming cap-and-trade emissions program. The state will join the initiative’s existing members: California, Quebec, and Washington.

Jaguar Land Rover (JLR) announced a £500 million ($669.6 million) investment to upgrade its Halewood facility for parallel electric vehicle (EV) production as part of its broader electrification strategy. This move supports JLR’s commitment to investing £18 billion in EVs by 2028, including the launch of a new electric Jaguar in 2025. The Halewood plant will be JLR's first all-electric production site, equipped with new EV build lines, autonomous robots, and cloud-based management systems.

Copenhagen Infrastructure Partners (CIP) has acquired a 1GWh battery energy storage project in Arizona from developer Strata Clean Energy.
Octopus Energy Generation has acquired Exagen Group, a British developer of solar and battery storage projects. Exagen has over 2.4 GW of generation capacity in development and has received planning consent for 520 MW of battery storage projects in England over the past year.

ECL announced the construction of the world’s first off-grid, hydrogen-powered 1 GW AI Factory data center in Texas. This $8 billion project, with an initial phase costing $450 million, will provide 50 MW of capacity by summer 2025, with a full 1 GW potential to be achieved later.
Avina Clean Hydrogen has secured permits to build a hydrogen production and refueling facility in southern California, expected to produce 1,400 tonnes of compressed hydrogen annually. The plant is scheduled to begin operations in the first half of 2025.

Related Stock List(s): Hydrogen Stocks

Novatek, Russia's leading independent natural gas producer, has suspended its Murmansk and Ob LNG projects due to increasing Western sanctions. The European Union's sanctions have restricted investments and essential services, significantly impacting Novatek's operations. In response, Novatek is considering alternative approaches, such as utilizing its natural gas reserves for fertilizer production to mitigate the effects.

Related Stock List(s): LNG Stocks

Centrus Energy is urging the U.S. government to direct $3.4 billion in federal funding toward domestic nuclear technology to reduce reliance on foreign nuclear fuel, particularly from Russia. Centrus is currently expanding its production of HALEU (High-Assay, Low-Enriched Uranium) for new-generation reactors and stresses the need for public-private partnerships to achieve large-scale production.

Cyclic Materials has raised $53 million in an oversubscribed Series B funding round. The round was led by ArcTern Ventures, with support from BDC Capital’s Climate Tech Fund and Microsoft’s Climate Innovation Fund. The funding will enable Cyclic to expand its rare earth recycling infrastructure in the US and Europe. Cyclic Materials aims to provide a sustainable alternative to traditional mining by recovering critical materials from recycling technological waste.

Related Stock List(s): Recycling Stocks

Macquarie Group's asset management division plans to acquire a "significant minority stake" in DE Shaw Renewable Investments for up to $1.73 billion. This investment will provide Macquarie access to a platform with 6 GW of operational onshore wind, solar, and battery storage assets, along with a 25 GW development pipeline.

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