Energy transition highlights: Our editors and analysts bring you the biggest stories from the industry this week, from renewables to storage to carbon prices.
Europe’s steel industry is set to be a significant consumer of renewable hydrogen and German steelmakers in particular have some of the most advanced plans in the region to tap the new green energy source.
Potential future demand from the German steel sector could amount to 850,000 metric tons per year by 2030, according to German steel association WV Stahl, with producers planning to connect to a national hydrogen pipeline network now under construction, as well as producing their own green hydrogen from electrolyzers onsite, saving 28 t of CO2 per metric ton of hydrogen.
The German government expects total hydrogen demand of 95-130 TWh (2.85 million-3.90 million t/y) by 2030, with 40-75 TWh from new demand. Carbon-accounted hot-rolled coil steel commanded a Eur120/t premium to the Platts conventional HRC assessment of Eur615/t ex-Ruhr.
Orsted has ceased the development of its pioneering FlagshipONE eMethanol project under construction in northern Sweden, citing slow market progress and an inability to sign long- term offtake contracts. The company took a final investment decision on the project in 2022 after acquiring it from Liquid Wind and was targeting emerging demand in the marine fuel sector.
The carbon market is on life support due to slow progress in resolving integrity issues for offsets and ideological differences among oversight groups, which are also choking off much needed decarbonization funding for developing countries, Peter Zaman, partner with specialist commodities and resources industries law firm HFW, said in an interview.
The US Bureau of Land Management will hold a competitive lease sale on Oct. 8 to explore nearly 220.000 acres in Nevada for geothermal power production. The agency’s announcement came as artificial intelligence companies like Google increasingly look to advanced geothermal technology as a round-the-clock carbon-free source of electricity to power datacenter operations.
Article 6 carbon credits, despite being backed by the UN and governments, may face the same skepticism as the private sector’s voluntary carbon credits around integrity and effectiveness in reducing emissions, experts said Aug. 15 at the Singapore Carbon Market & Investor Forum. Industry executives said the UN-backed market is subject to the same criticism, as countries could claim emissions reductions by purchasing offsets from overseas, instead of taking steps to incentivize actual emissions cuts domestically.
California carbon allowance costs are expected to clear at the lowest levels so far this year in the Aug. 14 third quarter auction, S&P Global Commodity Insights analysts project, as the market experiences volatility from rulemaking delays. Commodity Insights expects the Q3 auction to clear between $33.00-$33.50 per California carbon allowance, down at least 5% on the year as a delay in implementing program cuts weighed on the market.
Source: Platts
