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7 September 2022

The world of renewables this week

By Bogdan Avramuta

Russia will not resume natural gas supplies to Europe through the Nord Stream 1 pipeline unless sanctions are lifted, according to statements made this week. The pipeline is the single biggest pipeline for gas from Russia to Europe and has the capacity to deliver 55 billion cubic meters of gas a year, amounting to 10% of total demand.

Oil prices fell more than $1 per barrel on Wednesday to their lowest in over 7 months, largely driven by fears of rising interest rates and the impact a. broader global economic recession will have on fuel demand. Brent crude futures fell 1.2% to $92 per barrel. The move counteracted the rise seen on Monday as the OPEC+ cartel decided to cut output by 100,000 barrels per day in October.

Oil companies in the US are rallying against a government plan to tax methane emissions. Part of the new Inflation Reduction Act 2022, the law will come into place in 2024, putting a price of $900 for every ton of methane emitted into the atmosphere. After two years, the fee will rise to $1,500 per ton, acting to reduce the greenhouse gas which has an 80-times greater warming effect than CO2.

Germany has become the latest country to impose a windfall tax on its electricity producers, helping to fund a €65 billion relief package to alleviate the cost of energy bills. Proceeds will go towards an electricity price break, allowing each German household to consume a basic volume of power at reduced prices.

Liz Truss was sworn in as the UK Prime Minister on Tuesday, and will come into power under more pressure than almost all of her predecessors. As the country grapples with its energy crisis, Truss is expected to place a £2,500 cap on annual household bills.

Germany will keep two of its remaining three nuclear power stations on standby up until April, to provide backup power generation over winter. The country had been planning to phase out nuclear entirely by the end of this year but is facing particular strain due to its previous dependency on Russian natural gas. The move comes as Russia indefinitely suspended the flow of gas through Nord Stream 1, the pipeline under the Baltic Sea that is the main conduit for Russian gas into Germany and the rest of Europe.

Fortescue Future Industries has announced plans to build a 2 GW electrolyzer factory in Queensland, Australia, adding to the swelling pipeline of gigafactories worldwide. The company already has a joint venture for a Gigafactory in the US, with Plug Power, but has outlined that this is going to be too small to meet its own demand for capacity. Fortescue has plans to produce 15 million tons of green hydrogen per year by 2030, having already secured supply agreements in place with E.ON and JCB.

China’s state-owned oil giant Sinopec is planning to produce more than two million tons of green hydrogen per year by 2025, with ambitions of securing 60% of its hydrogen from renewable source in that timeframe. Much of this will be used to reduce the sulfur content of the company’s diesel fuel, which is currently achieved using ‘grey’ hydrogen – produced using natural gas.

American airline Delta will purchase 385 million gallons of green hydrogen-derived sustainable aviation fuel (SAFs) from DG Fuels. The fuel will be made by the Fischer-Tropsch (FT) process, which chemically pairs carbon monoxide and hydrogen to produce synthetic hydrocarbons. Hydrogen for the fuel will be produced through an 839 MW electrolyzer in the state of Louisiana, which is expected to come online in late 2026.

Five states in New England, USA are exploring new the idea of a new transmission system, which could connect up to 8.4 GW of offshore wind capacity over the next two decades. Under the request for information that was released on Thursday, states including Connecticut, Massachusetts, Maine, New Hampshire, and Rhode Island, specified that eligible solutions should be “scalable, cost-effective, and sufficiently flexible to accommodate up to 8.4 GW from current and future New England leaseholds.” Solutions would come online in 1.2 GW increments through 2040.

The first hydrogen railway has been given the go-ahead in Germany. State-owned transport agency LNVG plans to replace all its 15 diesel passenger trains on its Cuxhaven to Buxtehude route in the north of the country with 14 hydrogen fuel cell trains manufactured by French industrial giant Alstom by the end of this year. Refueling will take place halfway along the 79 kilometer route, at a newly build hydrogen refueling station. The facility can dispense 1,600 kilograms of compresses hydrogen per day. Although the hydrogen used at the beginning of this project won’t all come from renewable sources, the desire is for the trains to operate only on green hydrogen as soon as possible.

NuScale Power has signed a MOU (memorandum of understanding) with Fermi Energia, an Estonian energy company that is looking to adopt clean energy power sources to meet the country’s ambitious climate goals. Under the agreement, Fermi Energia will evaluate NuScales’s small modular reactor (SMR) design for deployment in Estonia.

Amazon has signed an agreement with Plug Power, an electrolyzer manufacturer, for 10,950 tons of green hydrogen per year from January 2025. The commerce giant has been using hydrogen powered forklifts, fitted with Plug Power fuel cells, in its warehouses since 2016 but the machines have been so far powered by grey hydrogen from natural gas. Amazon aims to achieve net-zero status by 2040 across all of its operations and thus is looking to cut down on the 8 to 12 tons of CO2 emitted for every ton of grey hydrogen it uses.

Bosch will invest $200 million in its auto parts factory in South Carolina to produce fuel cell stacks to supply an emerging market for zero-emission trucks powered by hydrogen. The production site is expected to become operational in 2026. Electric truck manufacturer, Nikola, which Bosch has invested in, will not only be a key customer for the power devices but also a distributor to other companies in North America.

Jacob Rees-Mogg has been announced as the UK energy secretary under new cabinet. Rees-Mogg has previously been a proponent for full and continued extraction of North-Sea oil. Rees-Mogg has also been quoted on numerous occasions with anti-renewable views.

Lithium bisulfonamide can theoretically replace lithium hexafluorophosphate, according to Yongtai Lithium. The company has claimed that lithium bisulfonamide has high conductivity, high thermal stability, and is not easily hydrolyzed.

First Solar has finally decided, in the wake of the Inflation Reduction Act, to invest $1.2 billion in 3.5 GW of fully-verticalized Cadmium-Telluride solar manufacturing capacity in the southeastern US. This is the company’s fourth and largest factory within the US, and a further $185 million will go to expansion of its three existing facilities in Ohio state. The company expects to sell 10 GW a year to US projects from 2025.

China has installed its largest offshore wind booster station so far at Bozhong Offshore Wind Power Site A, near Haiyang, Shandong Province. The booster station weighs 3,500 tons and stands 17 meters high from a 37-by-34-meter base.

Indian solar manufacturing has advanced with multiple major announcements. Chinese player Arctech has opened a 3 GW tracker factory in Mundra, Gujarat, while Reliance Industries now states that it will begin production at its 10 GW cell and module facility in Jamnagar by 2024. Bharat Electronics and NHPC, two state-owned companies, have signed a memorandum of understanding, intending to jointly establish a GW-scale solar factory. All told the Indian Government’s “Approved List of Models and Manufacturers” – which identifies domestic manufacturers – has now grown to 66 separate registered entities which boast 18 GW of cell and module production capacity, up from 8.2 GW in March 2021, according to analysis from JMK Research, which says that 18 GW will be fully operational by the end of 2023.

Iberdrola has said it will invest from $2 billion to $3 billion into Australian renewables in the coming years. Compare to its existing $2 billion of renewable assets in the country. Meanwhile the state of New South Wales has reached applications for fully 17 GW of renewables in its Illawarra Renewable Energy Zone, complete with battery energy storage for a total investment cost of $29.6 billion.