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COP29 Breakthrough: UN-Backed Global Carbon Market Takes Shape

Jennifer L
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0
COP29 Breakthrough: UN-Backed Global Carbon Market Takes Shape

COP29, held in Baku, made a major breakthrough in global climate action during its opening day. Nearly 200 governments agreed on a framework under Article 6.4 of the Paris Agreement. This deal sets up a UN-led global carbon market, allowing countries and companies to trade carbon credits more efficiently. The goal is to create a stronger demand for carbon credits, especially to fund climate projects in developing nations.

COP29 President Mukhtar Babayev called the agreement a “game-changing tool” to support climate action in less wealthy countries. He also urged all nations to continue working together to make more progress during the summit, noting that:

“By matching buyers and sellers efficiently, such markets could reduce the cost of implementing NDCs [Nationally Determined Contributions] by 250 billion dollars a year.”

A New Era for Carbon Trading

Article 6 of the Paris Agreement outlines how countries can work together to reduce greenhouse gas emissions. Article 6.4 introduces a global carbon trading system, managed by a UN body. This system will let countries and companies trade emissions reduction credits generated from projects worldwide.

The new system replaces the older Clean Development Mechanism (CDM) from the Kyoto Protocol. It aims to be more transparent and effective, ensuring that carbon credits are credible and valuable.

In October 2024, Article 6.4 Supervisory Body finalized rules for how projects will work under this system. These include standards for carbon removal projects and emissions reduction methods. The system will let companies in one country earn credits for reducing emissions and sell them to companies in another country, fostering global cooperation.

Challenges and Pushback

Despite the breakthrough, reaching an agreement wasn’t easy. Some countries and groups raised concerns about how decisions were made. The Coalition for Rainforest Nations (CfRN), representing several developing countries, argued that Article 6.4 Supervisory Body bypassed proper procedures.

Kevin Conrad, CfRN’s Executive Director, said the body adopted rules without first getting approval from the Conference of the Parties (CMA), which oversees the Paris Agreement. As a compromise, the final text used softer language, like “take note,” to acknowledge the rules without fully endorsing them. This wording sends a message that future decisions must follow proper processes.

Despite these issues, Babayev assured participants that more discussions on Article 6.4 would continue. Negotiations will also focus on Article 6.2, which deals with how countries trade carbon credits directly.

Strengthening Carbon Markets With New Rules

The new global carbon market aims to solve problems that have plagued carbon trading in the past. Older systems often faced criticism for lacking transparency and effectiveness, which led to low demand and falling prices for carbon credits. 

The chart below shows the quarterly credit retirements, which represent demand, falling and are lower this year than prior years.

quarterly carbon credit retirements Viridios AI
Chart from Viridios AI report

With clear rules and a centralized structure, Article 6.4 hopes to restore confidence in carbon markets. Sebastien Cross, Chief Innovation Officer at BeZero Carbon, called the agreement a major win for COP29. “This framework provides the tools we need to make carbon markets work better,” he said.

The carbon finance sector is optimistic that this move will help revitalize trading. 

The agreement also benefits project developers by giving them clear guidelines to follow. Countries can align their climate policies with international standards, making it easier to meet their emission reduction goals. 

Economic and Environmental Benefits

A global carbon market could bring significant economic and environmental gains. For one, it will provide new funding opportunities for climate projects, especially in developing countries that need financial support.

By creating a market-driven system, Article 6.4 encourages businesses to reduce emissions in cost-effective ways. Companies that reduce more emissions than required can sell their extra credits for profit. Meanwhile, those struggling to meet their targets can buy carbon credits to make up the difference.

This system not only helps cut global emissions but also supports sustainable development in poorer regions. It also allows countries struggling to meet their target by purchasing carbon credits.

What’s Next?

The Article 6.4 framework is just the beginning. The next steps include registering project methodologies and establishing operational guidelines, expected to be in place by mid-2025. During this period, the Supervisory Body will focus on finalizing details to ensure the system operates smoothly.

However, significant work remains to address concerns about market integrity and inclusivity. Some stakeholders worry that a centralized system could disadvantage smaller or less-developed markets. Policymakers must ensure the system is fair and accessible to all participants.

While there are still challenges ahead, this agreement sets the stage for stronger international cooperation. By establishing a UN-backed carbon market, the deal promises to boost demand for carbon credits and direct funding to critical climate projects.

As COP29 continues, leaders will work to refine this system and tackle other important climate issues.

U.S. DOE Greenlights Oklo’s First Commercial Nuclear Fission Plant at Idaho

Saptakee S
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0
U.S. DOE Greenlights Oklo’s First Commercial Nuclear Fission Plant at Idaho

Oklo, the California-based nuclear technology company recently announced that it has received clearance from the U.S. Department of Energy (DOE) and Idaho National Laboratory (INL) to proceed with site characterization for its first commercial fission power plant in Idaho.

The completion of the environmental compliance process is a significant milestone for Oklo as it can now initiate work for its fission power plant.

Jacob DeWitte, CEO and Co-Founder of Oklo noted,

“These approvals represent pivotal steps forward as we advance toward deploying the first commercial advanced fission plant. With this process complete, we can begin site characterization. Our unique business model of selling power directly to customers rather than power plants, combined with our early mover advantage, positions us to respond to a growing order book effectively and meet diverse energy needs across data centers, industrial processes, defense, and off-grid communities.”

Oklo Signed MOA with DOE for its Advanced Fission Power Plant

Oklo is dedicated to delivering clean, reliable, and affordable energy at a large scale. The company secured a site use permit in September through a Memorandum of Agreement with the DOE. This paved the way for its first commercial advanced fission power plant in Idaho, U.S. Interestingly, it’s the only advanced commercial fission company in the U.S. with a DOE site use permit.

The MOA will enable Oklo to conduct key site evaluations, including geotechnical studies, environmental surveys, and infrastructure planning. Additionally, it will also help maintain a schedule, manage costs, and support timely deployment.

On October 15, the company’s press release explained that they had also received DOE approval for its Conceptual Safety Design Report for the Aurora Fuel Fabrication Facility, which will recycle nuclear fuel material at Idaho National Laboratory (INL).

Subsequently, the Aurora Fuel Fabrication Facility will produce fuel for Oklo’s Aurora power plant at the Idaho National Laboratory (INL). It will essentially deploy high assay low enriched uranium recovered from spent Experimental Breeder Reactor-II fuel.

With a secured fuel supply, site use permit, and strong regulatory progress, Oklo is ready to launch its Aurora reactor. Its developed supply chain will further support the first deployment.

Now that the final clearance is approved by both the DOE and INL, CEO Jacob DeWitte is confident in the collaboration. He expects to bring Oklo’s first commercial nuclear fission plant online within the next few years.

From Waste to Power: Oklo’s Aurora Reactor Sets New Standards in Clean Energy

We discovered from World Nuclear News some unique features of the Aurora powerhouse, which are illustrated below:

  • It is a fast neutron reactor that generates electricity by moving heat from its core to a supercritical carbon dioxide power conversion system.
  • Designed to run on either fresh HALEU or recycled nuclear fuel, Oklo’s reactors can transform used nuclear fuel into clean energy.
  • It can generate 15 MWe, scale up to 50 MWe, and operate for over a decade before needing refueling.

The fission pioneer also explained that they use advanced recycling techniques to keep transuranic materials together as fuel. This avoids the need to create pure material streams, which is a unique feature of fast reactors.

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Uranium Royalty Corp.: Powering Decarbonization with Nuclear Efficiency

The only pure-play uranium royalty company is focused on capturing value from uranium price shifts through strategic investments. These include royalties, streams, debt, equity in uranium companies, and even physical uranium holdings. Notably, the company is growing with the rising demand for uranium.

  • IEA revealed that in the U.S. alone, nuclear energy supplied roughly 19% of total electricity in 2022 and accounted for 55% of the nation’s carbon-free electricity.
  • This nuclear output mitigated around 482 MMT of CO₂ emissions, which is equivalent to taking 107 million gasoline-powered vehicles off the roads.

More Power per Punch: Nuclear Energy Outshines Fossil Fuels

carbon credits

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Why Oklo’s Advanced Nuclear Fission is Just One of A Kind

Oklo’s advanced fission powerhouse has unique advantages over traditional power generation technologies. In short clean, resilient, reliable, and affordable are the four features that truly make it one of a kind.  

The reactors produce zero carbon emissions which makes them an environmentally friendly option. Oklo has stressed the fact that the energy density of nuclear fuel is a million times more than fossil fuels, hence it requires less land for mining. This attribute is significant for environmental preservation.

Moreover, unlike coal and gas plants that require frequent refueling, Oklo’s reactors can run for decades on a single load. This is how the nuclear company ensures long-term fuel reliability and independence.

Check out the landscape view of Oklo’s preferred site in Idaho

okloImage Source: Oklo Inc

Talking about the cost-effective factor, the immense energy density of its fuel makes it an economical alternative to fossil fuels. Also, nuclear fuel has fewer resource requirements and lower operational costs.

Most importantly Oklo’s reactors deliver consistent, clean energy, and heat with minimal refueling—sometimes as infrequently as every 20 years. This long-term reliability supports steady power output that’s ideal for critical energy needs.

Thus, starting with Aurora, Oklo is developing unique kinds of next-generation reactors. Furthermore, with the collaboration with DOE and INL, the company is just on the right path to establishing nuclear fission as an abundant, affordable, and clean energy source across the world.

China and Indonesia Bolster Ties with $10B Deal in Strategic Sectors. How will it Impact Indonesia’s Nickel Industry?

Saptakee S
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0
China and Indonesia Bolster Ties with $10B Deal in Strategic Sectors. How will it Impact Indonesia’s Nickel Industry?

China and Indonesia partnered for a series of business agreements worth $10 billion during the Indonesia-China Business Forum in Beijing on Sunday. This high-level forum followed a Saturday meeting between China’s President Xi Jinping and Indonesia’s President Prabowo Subianto. Reuters revealed that the leaders expressed their plans for strategic economic growth across sectors like food, clean tech, biotechnology, and pressing issues related to water conservation, maritime resources, and mining, particularly nickel.

Notably President Prabowo Subianto said,

“We must give an example that in this modern age, collaboration — not confrontation — is the way for peace and prosperity.”

The joint statement further explained their plans to expand cooperation across new energy vehicles, lithium batteries, photovoltaic projects, and the digital economy. They also committed to advancing the global energy transition, securing mineral resources, and stabilizing supply chains.

Indonesia Nickel

Indonesia’s Nickel Surge: Fresh Billion-Dollar Deals from China

Indonesia’s nickel industry was a significant topic of discussion during the meeting. The country, which leads global nickel production always has been a major investment hub for Chinese firms.

In this regard, the latest news is that Chinese battery materials producer GEM Co., Ltd striking a groundbreaking deal with Indonesia’s PT Vale to build a high-pressure acid leaching (HPAL) plant in Central Sulawesi. The agreement with a deal value of $1.42 billion, will ensure the nickel plant maintains nickel supplies which is crucial for battery-grade materials.

Moving on, Tsingshan Holding Group and Zhejiang Huayou Cobalt, the two major Chinese companies, continue to dominate Indonesia’s nickel industry. Their investments reflect faith in Indonesia as a prominent supplier of raw materials for EVs, lithium-ion batteries, and other green technologies.

Elaborating this further, Bloomberg reported that Zhejiang Huayou Cobalt Co. is pursuing $2.7 billion in financing for its battery-nickel plant in Indonesia. The financing deal, backed by Ford Motor Co., is being coordinated by HSBC Holdings Plc and Standard Chartered Plc, who are inviting additional banks to participate.

The Pomalaa plant, located in Southeast Sulawesi, will use high-pressure acid leaching (HPAL) technology to produce battery-grade nickel for electric vehicles. Notably, it will have a capacity of 120,000 tons of nickel annually, making it one of Indonesia’s largest HPAL projects. 

Both nations consider the timing of these deals a boon to the slump nickel market. Currently, nickel prices are weak due to low demand in the stainless-steel market and slow growth of the EV sector.

The Ever-Expanding Indonesian Nickel Industry

Indonesia has always attracted foreign investment to boost its domestic nickel production. The country sees this as essential for boosting and adding value to its vast natural resources. Despite these market pressures, Indonesia and China remain committed to their long-term goals, with Indonesia flagging its nickel industry as an integral part of its economic strategy.

As one of the top producers of metallic commodities—including gold, copper, cobalt, and especially nickel—Indonesia produced over half of the world’s mined nickel in 2023. Indonesia’s cost-effective nickel industry spurred major shifts in the nickel market. While nickel prices have dropped since last year, the country still maintained a resilient and steady production.

According to S&P Global Commodity Insights, Indonesia’s mined nickel production is expected to reach 2.1 million metric tons in 2024. This value is more than 50% of the anticipated global output and more than 2X its 2020 levels.

Indonesia Nickel

Source: S&P Global Commodity Insights

However, the rapid increase could eventually result in a global supply shortage, pushing prices back up to $28,000 per metric ton.

New Ventures in Tech, Travel, and Trade

China and Indonesia are not limiting their partnerships to the resources sector. Credible media agencies reported that GoTo Gojek Tokopedia, a prominent Indonesian technology company, signed agreements with China’s Tencent and Alibaba to bolster Indonesia’s digital infrastructure.

These partnerships can advance cloud services and foster local digital talent. It also signals a long-term investment in Indonesia’s digital economy and improving digital literacy and infrastructure at large.

Notably, President Subianto envisions transforming Indonesia’s tech landscape with investments in the most advanced sectors like AI and cloud computing.

Reuters reported, in addition to high-level industry deals, China and Indonesia agreed to streamline travel and visa policies, introducing measures like multi-entry long-term visas. This will enable more bilateral exchanges, business trips, and tourism.

Furthermore, the nations also agreed to deepen trade in agricultural products, including fresh coconuts. Interestingly, President Subianto also secured export agreements during his visit. This expansion of agricultural exports creates new opportunities for Indonesian farmers while fulfilling China’s demand for tropical produce.

Overall, it is evident that President Subianto’s decision to choose China as its first state visit shows the nation’s strong intention to deepen ties with Beijing.

Source: China, Indonesia seal $10 billion in deals focused on green energy and tech | Reuters

The G-20’s $1.1 Trillion Fossil-Fuel Subsidy and Carbon Pricing Initiatives

Jennifer L
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0
The G-20’s $1.1 Trillion Fossil-Fuel Subsidy and Carbon Pricing Initiatives

As the world gears up for the upcoming UN climate summit, COP29, in Baku, Azerbaijan, the G-20 governments face the challenge of crafting more ambitious climate plans. These plans must balance bold climate commitments with economic realities like budget constraints, a cost-of-living crisis, and the push for energy independence. The situation is further complicated by recent election outcomes.

However, not all G-20 countries are moving at the same pace. The latest Climate Policy Factbook by BloombergNEF, commissioned by Bloomberg Philanthropies, evaluates G-20 progress in three crucial policy areas:

  • Fossil-fuel subsidies,
  • Carbon pricing, and
  • Climate-risk policies.

Here’s our key takeaways from the report. 

Fossil-Fuel Subsidies Surge Despite Climate Goals

In 2022, G-20 countries provided a staggering $1.1 trillion in fossil-fuel support, the highest in over a decade. This spike was driven by the global energy crisis, as governments aimed to shield consumers from soaring energy costs. 

G-20 fossil-fuel subsidy 2018 - 2023

However, $500 billion of this went to producers and utilities, some of which reported record profits.

Despite global climate goals, the G-20 is expanding its coal power capacity. From 2019 to 2023, coal-fired capacity grew by 3%, adding up to 2 terawatts (TW) of operational capacity, with another 0.6 TW in development. Coal remains the largest contributor to climate change. 

The distribution of fossil-fuel support by type has remained largely unchanged in recent years. Although coal represents a small portion, its share is significant due to the high overall fossil-fuel support in 2022. G-20 governments allocated $49 billion to coal, the most emissions-intensive fuel.

Remarkably, OECD members reduced coal capacity by 22% since 2019. Conversely, non-OECD economies increased their coal capacity by 6%.

Country Progress

Australia is showing improvement by reducing coal-fired capacity and lowering fossil-fuel support in 2022. Meanwhile, China and Japan are labeled as making insufficient progress while Canada and the UK were downgraded to “mixed progress.”

Preliminary 2023 data suggests fossil-fuel subsidies fell to $945 billion, a 19% decrease from 2022 but still above pre-crisis levels. Reforming these subsidies is politically sensitive, as it could raise consumer prices. 

Canada offers a potential pathway by defining and eliminating inefficient fossil-fuel subsidies.

Carbon Pricing Gains Traction, But Is It Enough?

Carbon pricing is becoming more widespread across the bloc. It now account for about 25% of global greenhouse gas emissions and 29% of G-20 emissions through taxes or trading schemes, per BNEF analysis. This share is expected to grow as more programs roll out.

Share of global emissions covered by a carbon price

Currently, 14 G-20 economies, including the EU, have economy-wide carbon pricing mechanisms. Russia and the US have subnational schemes, while South Africa remains the only African Union member with a carbon tax in place.

value of major compliance carbon markets in the G20

While some G-20 countries, like Australia, China, and South Africa, have seen rising carbon prices, others, particularly in Europe, experienced declines. Only the EU’s Emission Trading Scheme (ETS) currently operates within the price range necessary to limit global warming to 2°C by 2030.

Expanding Carbon Markets

Canada, France, Germany, and Mexico lead the pack with multiple national-level carbon taxes or markets. 

Brazil, India, and Turkey are designing compliance carbon markets while Indonesia and Japan are considering additional carbon pricing programs. And all EU members will see another carbon market with the 2027 launch of the road transport and buildings ETS.

Notably, China’s carbon market, the largest globally by covered emissions, is set to expand to aluminum, steel, and cement sectors. The EU ETS leads in traded value, driven by higher prices and trading volumes, whereas Canada and California are on track to meet their targets by the end of the decade.

Carbon Market Valuations

The combined value of G-20 compliance carbon markets exceeded $800 billion in 2023, BNEF Factbook shows. Price increases across these markets stemmed from policy reforms aligning with climate goals, though trading volumes dipped in some due to economic impacts from Russia’s invasion of Ukraine.

As G-20 members strengthen their carbon markets, they create powerful incentives for emission reductions and sector-specific adaptation. As such, they can contribute significantly to the transition toward a low-carbon global economy.

Climate-Risk Policy: Who’s Leading and Who’s Lagging

G-20 members are at varying stages of implementing climate-risk regulations. Some, like the EU, Brazil, and the UK, lead the charge with comprehensive frameworks. 

However, others, including Argentina, Saudi Arabia, and Russia, lag behind, lacking even basic regulations. Other remarkable recent developments in this area include:

  • Turkey and the US made notable strides in climate-risk policy.
  • Nine G-20 countries have adopted or are developing regulations aligned with the International Sustainability Standards Board (ISSB).

The ISSB framework promotes consistency in climate-risk reporting. However, its effectiveness could be undermined by local variations and relatively low stringency.

What COP29 Means for G-20 Climate Action 

The G-20’s progress is uneven, with some countries advancing robust policies while others remain stuck in outdated systems. COP29 presents a crucial opportunity for world leaders to reassess their commitments and bridge these gaps.

Based on BNEF’s Climate Policy Factbook data, to accelerate the transition to a low-carbon economy, countries must:

  • Phase out fossil-fuel subsidies, starting with inefficient ones.
  • Strengthen carbon pricing mechanisms to provide real incentives.
  • Implement stringent climate-risk policies to build a more resilient economy.

Ultimately, meaningful climate action requires global cooperation and bold leadership, particularly from the G-20, which holds the key to the planet’s future.

Energy Efficiency Hits $660 Billion in 2024: The World’s Best Bet for Cutting GHG Emissions

Jennifer L
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0
Energy Efficiency Hits $660 Billion in 2024: The World’s Best Bet for Cutting GHG Emissions

Most industrial greenhouse gas (GHG) emissions come from energy use. By improving energy efficiency, the world can cut energy consumption, lower emissions, and save on costs. It’s a smart and cost-effective first step toward decarbonization and businesses are continuing to pour funds into energy efficiency initiatives and technologies worldwide as the International Energy Agency (IEA) reported. 

The IEA’s Energy Efficiency 2024 highlights key trends in energy intensity, demand, prices, and policies. It also offers insights into system-wide themes including investment, which this article will delve into in detail.

Driving Change: What Leads the Energy Revolution?

The report shows that energy efficiency investments could remain resilient in 2024, with total spending projected to reach around $660 billion. This level matches the record set in 2022 and highlights the steady commitment to sustainable energy use. These investments span sectors like transport, buildings, and industry, driven by the need to reduce emissions and enhance energy efficiency amid fluctuating economic conditions.

Energy efficiency investment in the buildings, transport and industrial sectors, 2019

Since 2019, global energy efficiency investments have surged by 45%, fueled by the energy crisis and significant government spending post-Covid-19. The transport sector has seen the highest growth, with a 77% rise, followed by buildings at 34% and industry at 13%. 

Global investment in energy efficiency by sector and region 2019-2024
Source: IEA 2024 Report

However, from 2022 to 2024, the trend shifted. Investments in buildings dropped by 7%, while transport saw a 14% rise, and industry remained steady.

A key driver for the trend is the push for efficient electrification, especially in the electric vehicle (EV) sector across China, Europe, and North America. EV sales, particularly in emerging markets, have supported this trend. 

However, as energy prices stabilize and government stimulus wanes, overall global investment has plateaued. Rising inflation and interest rates also pose challenges for financing efficiency upgrades.

Emerging Markets Take the Spotlight in Efficiency Investments

The growth of efficiency-related investments in 2024 is uneven across regions. Emerging markets and developing economies (EMDEs) are expected to lead. 

Africa is projected to see a 60% rise, the Middle East 40%, and Central and South America over 20%. China will also witness nearly 10% growth.

Annual energy efficiency investment by selected country and region, 2019-2024e

Conversely, advanced economies are stabilizing after years of crisis-driven spending. Europe is set for a slight decline, while North America will see a modest 5% increase. 

Despite slower growth in these regions, they still account for the bulk of global energy efficiency investments—95% of total spending occurs in Europe, Asia Pacific, and North America, regions responsible for about 75% of global energy demand.

Transport Electrification: A Surge in EV Sales

Globally, the electrification of transport has gained momentum. By 2024, around one in five new cars sold will be electric. 

EV sales reached 14 million in 2023, making up 18% of total car sales, and this figure is expected to grow to 17 million in 2024. The bulk of these sales occurred in China, Europe, and North America, which accounted for 95% of global EV sales.

In EMDEs, the focus remains on two- and three-wheelers. These vehicles dominate markets in regions like Southeast Asia and Latin America. China leads in two-wheeler sales, though global sales in this category dropped 18% in 2023 due to supply chain disruptions. 

India, however, saw a 40% increase in electric two-wheeler sales and continued growth in three-wheelers, spurred by government initiatives like the Electric Mobility Promotion Scheme.

EV sales forecast to 2028
Source: S&P Global

According to S&P Global data represented by the chart below, global passenger plug-in EV sales could reach over 33 million units by 2028. That’s almost a 104% increase in EV units sold. China is set to take the biggest growth in sales.

The number of people projected to use EVs for the same period (penetration rate) will also double by 2028 compared to 2024.

Source: S&P Global

Building Smarter: A Post-Crisis Slowdown

Investment in energy-efficient buildings boomed during the energy crisis, driven by technologies like heat pumps. In 2022, heat pump sales peaked, particularly in Europe, where they are central to long-term climate goals. 

Energy efficiency investment spending in the buildings sector

However, this momentum slowed in 2023 due to high electricity prices and reduced government support. For instance, Italy’s Superbonus program, which heavily subsidized energy-saving renovations, was phased out in 2024. This program alone accounted for more than half of Italy’s building sector investments in 2023. 

Meanwhile, heat pump deployment in China has seen modest growth. These trends highlight the critical role of government policies in sustaining investment in building efficiency.

ESCOs and the Power Players Behind the Efficiency Boom

The energy service company (ESCO) market experienced a slight decline in 2023, dropping by 2.2%. Despite this, the market size remains robust at over $35 billion, supported by strong policies in regions like the U.S. 

Federal programs, such as the Federal Energy Management Program, have bolstered ESCO activities, which grew by 54% between 2021 and 2023 in the U.S.

Total investment by energy service companies, 2015-2023

China leads the global ESCO market, with investments exceeding $20 billion in 2023, accounting for half the global total. The majority of ESCO investments target the buildings sector, followed by industrial applications and energy storage.

Among the major players in the ESCO market, some of the interesting companies making waves in the sector include:

  • Johnson Controls is a global leader in smart building solutions, offering advanced technologies and services to enhance building performance and sustainability. In energy efficiency, Johnson Controls has made significant progress by implementing high-capacity heat pumps and optimizing energy use in various industries. They have contributed to over $6 billion in customer projects worldwide, driving sustainability and reducing carbon footprints​.
  • Ameresco is a leading cleantech integrator that specializes in energy efficiency, renewable energy, and infrastructure modernization. In 2023, its renewable energy projects and assets helped avoid around 16 million metric tons of CO₂ emissions, contributing to over 110 million metric tons of cumulative carbon reductions since 2010. Ameresco has received numerous awards for its sustainability efforts and continues to drive innovation in clean energy​.
  • Trane Technologies, through its flagship brand Trane, provides innovative HVAC solutions designed for energy efficiency and sustainability. The company delivers services such as Energy Savings Performance Contracting (ESPC) to optimize energy consumption and reduce operational costs for buildings. Trane emphasizes sustainability, helping clients meet carbon reduction goals through electrification, energy monitoring, and renewable energy integration​.
  • NORESCO is specializing in energy and infrastructure solutions for government, institutional, and commercial clients. The company has a strong track record in improving energy efficiency, managing over $2.75 billion in federal energy projects. It helps clients achieve sustainability goals through advanced technologies like microgrids, battery storage, and renewable energy systems. 

Scaling Up: What’s Needed for 2030?

To meet net-zero targets, energy efficiency investments must triple by 2030, reaching $1.9 trillion annually, per the report. The IEA’s NZE Scenario underscores the importance of a comprehensive strategy tailored to each country’s needs.

In emerging economies, efforts focus on improving building performance and electrifying transport. In sub-Saharan Africa, the transition to clean cooking fuels is a top priority. Advanced economies, meanwhile, focus on retrofitting older infrastructure, deploying heat pumps, and scaling up EV infrastructure.

Ultimately, energy efficiency investment is vital for meeting global climate goals and expanding investment to underrepresented regions will be key to accelerating progress.

Lithium Market Lows: How Are Albemarle and Pilbara Minerals Adapting?

Saptakee S
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0
Lithium Market Lows: How Are Albemarle and Pilbara Minerals Adapting?

From the latest news from CarbonCredits, you can see that the lithium market has entered a period of price decline. This is mainly because of weaker demand conditions and an oversupply of lithium carbonate in key regions. However, this trend doesn’t favor the top lithium miners and producers across the globe. Recently Albemarle and Pilbara have taken some drastic steps to counter the lithium market lows.

Let’s see how they are navigating the challenges…

Albemarle’s Strategy for Surviving the Lithium Market Slump

As a consequence of dropping lithium prices, Albemarle Corporation is set to reduce its global workforce by between 6% and 7%, which will save around $300 million to $400 million annually as reported by S&P Global Commodity Insights.

Despite being the world’s largest lithium producer, the company reported a net loss of $1.07 billion for the third quarter. The company released its earnings report on November 6.

Kent Masters, Albemarle’s president and CEO expressed himself by saying,

“Right now we’re focused on making sure that we put the cost structure in place to compete through the bottom of the cycle. We’re trying to create the flexibility to pivot up if the market returns.”

The New Approach

The earning report revealed how the company is planning to streamline its organization by adopting a more integrated and functional model. In purview, it will reduce its 2025 capital expenditures by about 50% compared to 2024 to bring spending down to between $800 million and $900 million.

The company noted that this quarter’s results sharply contrast with the $302 million net income earned in the same period last year.

CEO Kent Masters emphasized that China has scaled back high-cost lepidolite production, while Australian miners have reduced output and laid off employees in response to market conditions. Still, these trimming measures are insufficient to stabilize lithium prices.

According to him, the surprising factor is that “African supply has filled Chinese cuts.”

On the demand side, CFO Neal Sheorey highlighted a 36% increase in demand for lithium in grid storage this year, driven by U.S. and Chinese projects, along with a 23% rise in global electric vehicle registrations.

Albemarle estimates that around 25% of the lithium industry is currently operating at a loss. The reason is again the oversupplied market. However, the top lithium producer wants to stay competitive over the long term. This is why they have conducted a thorough review of their costs and operating structure.

Albemarle

Broadly speaking, they revealed their potential future actions to address ongoing market challenges. Masters said that, while rising demand could help restore balance further production cuts will be essential to stabilize prices effectively. In response to the lingering low lithium prices, the company plans to adopt a conservative growth strategy to ensure long-term reliance.

Notably, In July, Albemarle halted expansion plans at its Kemerton lithium hydroxide refinery in Australia to manage costs more effectively.

Li-FT Power: Exploring & Developing Hard Rock Lithium Deposits In Canada

Li-FT Power Ltd. (TSXV: LIFT) recently announced its first-ever National Instrument 43-101 (NI 43-101) compliant mineral resource estimate (MRE) for the Yellowknife Lithium Project (YLP), located in the Northwest Territories, Canada.

An Initial Mineral Resource of 50.4 Million Tonnes at Yellowknife.

This maiden estimate is a major milestone for the company and marks a significant step forward in the project’s development. Li-FT Power’s upcoming mineral resource is expected to further solidify Yellowknife as one of North America’s largest hardrock lithium resources.

Click to learn more about lithium and Li-FT Power Ltd. >>

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Pilbara’s Strategic Move to Overcome Lithium Price Dip

On October 30, Pilbara Minerals announced its decision to pause construction of their Mid-Stream Demonstration Plant Pilgangoora lithium mine in Western Australia citing weak lithium prices as the main reason. The project is a JV with environmental technology company Calix Ltd formed in November 2022.

The smaller Ngungaju plant will be placed on temporary care and maintenance from December 1 which will allow the company to manage current price pressures more efficiently.

Pilbara Minerals highlighted that spodumene concentrate prices, ranging from US$750 to $800 per ton, remain below the sustainable industry benchmark of US$1,400 per ton.

  • In the September quarter, the company sold lithium at an average of US$682 per ton, a decrease from US$840 per tonne in the previous quarter.

The demonstration plant at Pilgangoora that would produce lithium salts using Calix’s advanced calcination technology was 60% completed by the end of September this year. Pilbara anticipates these measures will contribute about A$200 million in cash flow improvements for fiscal 2025.

pilbara

Cutting Capital Expenditure

  • MINING.com reported: Pilbara Minerals also revised its production guidance for fiscal 2025 to a range of 700,000 to 740,000 dry metric tonnes (dmt). It’s down from an earlier target of 800,000 to 840,000 dmt.

Meanwhile, it has cut its capital expenditure forecast to between A$565 million and A$610 million, down from a previous estimate of A$615 million to A$685 million.

Managing Director and CEO Dale Henderson said,

“Given current lithium price environment, this pause enables the joint venture to time expenditure with improved market conditions. We remain fully supportive of the midstream strategy and our joint venture, recognising the Project’s potential to transform the lithium supply chain through lower emissions and value-added processing. Our commitment to our joint venture with Calix remains. We will assess with Calix resuming the Project as market conditions improve or further government support is received.”

Lithium Glut Lingers, Even as Demand Surges

According to S&P Global Commodity Insights, the lithium market is expected to face a supply surplus until at least 2027. However, this excess supply will maintain low lithium prices until demand rises to balance out the excess.

Data Source: S&P Global

Analyzing the market condition further, the lithium scenario is quite vivid. This rapidly growing demand has attracted new lithium players, but major producers are yet to make significant production cuts.

Explore here to learn everything about what’s happening with lithium now: The Lithium Paradox: Price Plummet, Supply Surge, and Demand Dip – What’s Happening Now?

How Did the EU Cut Over 8% of GHG Emissions in 2023?

Jennifer L
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How Did the EU Cut Over 8% of GHG Emissions in 2023?

The European Commission’s (EC) 2024 Climate Action Progress Report highlights significant strides in reducing greenhouse gas (GHG) emissions across the EU, with an 8.3% decrease in 2023. This marks one of the largest non-COVID-related declines in recent history, driven largely by a 24% reduction in emissions from electricity production and heating. 

Trading Carbon, Saving the Planet: How EU ETS Drives Climate Action

What makes such a significant reduction in EU emissions possible is the bloc’s Emissions Trading System (ETS). The ETS is a key policy tool that slashes GHG emissions across several high-emitting sectors. It applies the polluter pays principle, holding companies accountable for their emissions in these key sectors:

  • Electricity and heat generation,
  • Industrial manufacturing, 
  • Aviation, and 
  • Maritime transport

Together, these sectors account for about 40% of the EU’s total emissions. 

Launched in 2005, the ETS has been a cornerstone of the EU’s climate strategy and 2050 net zero goals. 

Achievements of the EU ETS

According to the report, by 2023, the EU ETS had significantly driven down emissions in its covered sectors. Key accomplishments include:

  • 47.6% emissions reduction in electricity, heat generation, and industrial manufacturing compared to 2005. 
  • Raised over €200 billion through allowance auctions, with €43.6 billion generated in 2023. Member States have used these funds to:
    • Support renewable energy projects.
    • Improve energy efficiency.
    • Develop low-emission transport solutions.

The 2023 revision of the EU ETS Directive introduced significant updates. As of June 2023, Member States are now required to direct all ETS revenue (or an equivalent amount) toward climate action and energy transformation. This includes measures to address the social impacts of the green transition.

Non-ETS sectors like buildings, agriculture, transport, and waste saw modest reductions, driven by a 5.5% decrease in building sector emissions. The EU’s carbon sinks in the Land Use, Land Use Change, and Forestry (LULUCF) sector increased by 8.5%. This raise reverses a decade-long decline, though further efforts are needed to meet long-term targets.

The Transition Powering Europe’s Emissions Drop

Provisional 2023 data of the EC report shows that the region is on track to meet its goal of cutting GHG emissions by at least 55% by 2030, compared to 1990 levels. To stay on target, the EU needs to reduce emissions by an annual average of 134 million tonnes of CO₂ until 2030. That is slightly more than the 120 million tonnes reduced annually between 2017 and 2023. 

EU GHG net emissions, projections and targets
Source: EU Climate Action Progress Report 2024

Achieving this goal will require fully enforcing climate policies and increasing investments. After 2030, the focus will shift to tougher industries and boosting carbon removal to reach net zero by 2050.

In 2023, greenhouse gas emissions saw their largest annual drop in decades, apart from the COVID-19 pandemic year of 2020. By the end of the year, total net emissions were 37% lower than in 1990, while the economy grew by 68% over the same period. This highlights the ongoing decoupling of emissions from economic growth, showing it’s possible to reduce emissions while expanding the economy.

EU GHG Net Emissions (EU Target Scope) and By Sector

EU GHG net emissions (EU target scope) and by sector
Source: EU Climate Action Progress Report 2024

The report attributes the 8.3% emissions drop to a strong transition to renewable energy sources, particularly wind and solar, which now supply nearly 45% of EU electricity. Moreover, electricity and heat supply fell slightly by 3.1% and 2.3%, respectively. 

Preliminary data shows renewables became the top electricity source, generating 44.7%, compared to 32.5% from fossil fuels and 22.8% from nuclear. Hydropower and nuclear energy also rebounded.  

Additionally, gas has replaced coal in many cases, resulting in a 20% reduction in fossil fuel-generated electricity compared to 2022.

The EU’s ambitious climate goals are embedded in the European Green Deal and the 2021 European Climate Law. Its 2050 net zero goal includes a binding target of a 55% reduction in GHG emissions by 2030 relative to 1990 levels. This target is supported by the “Fit-for-55” legislative package, which includes expanding the EU ETS to cover more carbon-intensive sectors. The goal is to create further economic incentives to reduce emissions.

Economic Growth and Climate Action, Together

While the EU has already achieved a substantial emissions reduction, the report underscores ongoing challenges. 

For instance, emissions from the EU ETS-covered aviation sector rose by 9.5% while other sectors showed slow progress in reductions. Agricultural emissions dropped by 2% and transport emissions by less than 1%. These figures indicate areas where the EU will need to accelerate efforts to meet future targets.

Looking ahead, the EU is contemplating a new emissions target for 2040, with the Commission recommending a 90% GHG reduction. Achieving this target would require an estimated €660 billion annually for energy systems and €870 billion per year in the transport sector. 

Priority investments would focus on decarbonizing industrial processes, enhancing energy efficiency, shifting towards electrification, and developing sustainable fuels for the transport sector.

As the EU prepares for global climate talk, COP29, Wopke Hoekstra, Commissioner for Climate Action, emphasized that the EU’s efforts showcase how economic growth and climate action can coexist. 

The report stresses the importance of climate resilience and international cooperation, particularly through the upcoming COP29. The bloc aims to lead in global climate finance and development assistance, contributing a third of global public climate funding.

Navigating the Green Hydrogen Hype: IRENA’s Take on the “Silver Bullet” vs. “Champagne” Strategies

Saptakee S
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0
Navigating the Green Hydrogen Hype: IRENA’s Take on the “Silver Bullet” vs. “Champagne” Strategies

From combating climate change to boosting economic competitiveness, green hydrogen offers multiple solutions to some of today’s biggest challenges. Significantly, it’s a zero-emission fuel that has the potential to transform the automobile industry.

As more countries embark on their hydrogen journey, there’s stiff competition riding for every nation. Governments are apprehensive about not missing out on anything. This means each nation wants to set ambitious goals and is under pressure to keep up.

However, a rush to adopt hydrogen policies without careful consideration can lead to misguided investments. This phenomenon named “siren call,” by IRENA, has a high risk of policy failure if pursued without a realistic assessment of local capabilities and requirements.

Therefore, countries that align their hydrogen strategies with specific policy drivers are most likely to succeed in a robust and resilient hydrogen sector.

Green Hydrogen Strategy: “Silver Bullet” vs. “Champagne” Approach

IRENA has decoded an interesting way to explain the diverse national hydrogen strategies that are in place. The two major perspectives are the “silver bullet” and the “champagne” approaches. Each approach represents a distinct stance on the role of hydrogen in achieving decarbonization goals and informs how policy and investments shape the sector.

The “Silver Bullet” Approach: Hydrogen Everywhere, All at Once

The “silver bullet” approach positions hydrogen as a flexible, wide-reaching solution, with applications spanning from heavy industry to residential heating. Nations that support this approach view climate change as a pressing issue that demands exploring all possible pathways to cut emissions.

IRENA emphasized that this strategy leans on a “free-market mindset”, where policymakers are involved in the following roles:

  • balance supply and demand
  • set up market structures
  • support the development of necessary infrastructure.

Furthermore, the “silver bullet” approach encourages early investments in hydrogen transport and storage. This is because such nations consider adopting these two mechanisms broadly across all sectors.

For example, countries like Australia, Canada, and the United Kingdom often embrace the “silver bullet” approach. These nations, which produce fossil fuels, see potential in developing and exporting blue hydrogen and are already investing in decarbonization across industries.

Having production-based economies and access to advanced technologies, these countries support hydrogen as a key driver of their sustainability goals. All the more, they aim to decarbonize areas like building heating and transportation with the “silver bullet” approach.

The “Champagne” Approach: Hydrogen for Specific High-Value Uses

In contrast, the “champagne” approach is a more cautious way of viewing green hydrogen. Simply put it is considered costly and risky compared to other established solutions. This approach advocates using hydrogen selectively in areas where alternatives are limited or cannot be accessed. The purpose is to avoid diverting resources from the proven technologies that are already being used.

Countries with strong renewable energy resources, such as Austria and Kenya, generally favor this view. For them, the hydrogen strategy focuses on decarbonizing high-energy industries or sectors like aviation and maritime, where electrification remains a challenge.

Elaborating further, the “champagne” approach is a reflection of the industrial policy mindset, with policymakers playing an active role in shaping hydrogen development. In this, investments mainly focus on applications where other decarbonization options aren’t viable.

IRENA revealed that Austria prioritizes hydrogen for high-temperature industrial processes and aviation. The country optimizes hydrogen use within a broader energy transition strategy, making the shift to green energy both practical and sustainable.

A quick summary of these two approaches is below:

hydrogen IRENASource: IRENA

Key Drivers Fueling Green Hydrogen Development

As mentioned at the beginning, various drivers are pushing governments to support green hydrogen. So, what are the main motivators behind hydrogen’s growing role?

hydrogen IRENA

The Hard-to-Abate Sectors

While electrification can lower emissions in some areas, certain industries, like steel, cement, and chemicals, are challenging to decarbonize and involve energy-intensive processes. This is why these “hard-to-abate” sectors need alternatives beyond direct electrification. Notably, green hydrogen offers a promising low-carbon solution for this sector.

However, beyond industry use, there are many more economic opportunities through the production of hydrogen-related components, like compressors and control units, etc.

The countries focused on green industrialization- be it through the “silver-bullet” or “champagne” approach are keen to use green hydrogen in their national strategies.

 A Sustainable Economy

Countries that depend on fossil fuels are now looking to green hydrogen as a way to sustain their economies. By using renewable resources, these nations can develop new export markets focused on green hydrogen. Even countries without a long history in fossil fuels are also exploring hydrogen exports to meet rising global demand and diversify their revenue sources.

Subsequently, this shows the flexible nature of hydrogen- meaning it can be produced worldwide. This diversification reduces geopolitical risks and gives nations more control over their energy future.

Another significant thing is energy security, especially for nations reliant on imported fuels. Therefore, developing a robust domestic green hydrogen supply can help these countries reduce imports, stabilize energy prices, and lower their vulnerability to global market changes.

Long-Term Renewable Energy Storage

As renewable energy usage increases, seasonal fluctuations can create power supply issues. Hydrogen offers a solution for large-scale, long-term storage, helping balance renewable power systems.

When energy production exceeds demand, the surplus electricity can be used to produce hydrogen which can be stored for the future. This capability is essential for countries transitioning to renewables, as it helps avoid power waste and reduces risks associated with variable renewable energy supplies.

Image: Common uses of long-term energy scenarios

hydrogen

Improving Urban Air Quality

As hydrogen fuel cell vehicles emit no pollutants they offer a cleaner alternative to diesel and gasoline vehicles. This is especially valuable in cities with high pollution levels.

Apart from the U.S., U.K., and Australia, China is also promoting hydrogen in mobility projects to cut oil dependence and reduce air pollution. This has a direct benefit on public health and the environment.

As these drivers create interest in hydrogen, each country designs its strategy to match its unique energy needs, resources, policy goals, and most importantly its budget. However, the final aim is to create sustainable and resilient hydrogen ecosystems.

Source: IRENA Green Hydrogen Strategy Design 2024

Canada’s Emissions Cap for Oil & Gas: Will It Cut Carbon or Curb Production?

Jennifer L
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0
Canada’s Emissions Cap for Oil & Gas: Will It Cut Carbon or Curb Production?

Canada’s upcoming emissions cap on the oil and gas sector aims to cut greenhouse gas emissions by 37% by 2030 from 2022 levels. However, the energy industry and provinces like Alberta are strongly opposing it. 

The plan, unveiled Monday, introduces a cap-and-trade system designed to encourage higher-polluting firms to invest in emissions-reduction projects while recognizing better-performing companies. The intent to cap the oil and gas industry was first revealed during the COP28 last year in Dubai. 

Beyond Black Gold: A Green Transition?

Environment Minister Steven Guilbeault clearly emphasized the importance of this move, stating that:

“Every sector of the economy in Canada should be doing its fair share when it comes to limiting our country’s greenhouse gas pollution, and that includes the oil and gas sector. We are asking oil and gas companies who have made record profits in recent years to reinvest some of that money into technology that will reduce pollution in the oil and gas sector and create jobs for Canadian workers and businesses. ”

Canada’s oil and gas sector contributed 31% of the country’s total emissions in 2022, per the latest National Inventory Report. It is the largest emitting sector, followed by the transportation and buildings sectors.

Canada GHG emissions by sector 2022

High Stakes in the Oil Sands

In 2022, Canada’s oil sands led to oil and gas emissions of 87 megatonnes or 40% of the sector’s total. The sector’s emissions have largely been driven by increased production. 

Since 1990, Canada’s total crude oil output surged by 193%, primarily fueled by oil sand operations, which grew over 800% and accounted for 80% of this production increase. This growth underscores the oil sands’ significant impact on Canada’s total emissions.

change in Canada oil and gas sector GHG emissions
Source: National Inventory Report

These major carbon emitters are largely concentrated in the provinces of Alberta and Saskatchewan, where oil sands and natural gas production are prevalent. Here are a few key players, with their latest GHG emissions reported and net zero goals. 

Suncor Energy Inc.

One of Canada’s largest integrated energy companies, Suncor operates in Alberta’s oil sands, where its extraction and processing activities generate significant emissions. The oil major’s GHG emissions totaled almost 35 million metric tons of carbon dioxide equivalent (MtCO₂e) in 2022. 

Suncor aims to achieve net zero in its operations by 2050 and cut emissions by 10 megatonnes across the value chain by 2030. The company has been actively pursuing emissions reduction initiatives, including investments in carbon capture and renewable energy.

Canadian Natural Resources Limited (CNRL)

CNRL is among Canada’s top oil sands producers and one of the largest carbon emitters in the country, releasing over 23 million MtCO₂e in 2022. They are a key member of the Pathways Alliance, along with Suncor, which aims to build carbon capture and storage (CCS) networks to reduce sector emissions.

The energy firm commits to reducing its carbon footprint by 40% in Scope 1 and 2 GHG emissions by 2035m compared with the 2020 baseline. It also targets to reach net zero emissions by 2050. 

Imperial Oil Limited

A major player in the oil sands and petrochemical industries, Imperial Oil operates facilities with large carbon footprints, including open-pit mining and in-situ extraction operations. It has also partnered with CCS initiatives to cut emissions.

The oil major aims to hit net-zero scope 1 and 2 emissions, from operated assets by 2050. Its emissions totaled 8.9 million MtCO₂e in 2021.

Cenovus Energy Inc.

Known for its oil sands and conventional oil operations, Cenovus has significant emissions, especially from its steam-assisted gravity drainage (SAGD) operations. Cenovus is also part of the Pathways Alliance, focusing on long-term decarbonization.

The company aims to slash GHG emissions to net zero by 2050, with 18.2 million MtCO₂e produced in 2022. 

How Canada’s Emissions Cap Could Redefine Oil & Gas

Canada’s proposed emissions cap for the sector focuses on emissions rather than limiting production. These regulations are informed by discussions with industry, Indigenous communities, provinces, territories, and other stakeholders and are designed to align with achievable technical measures, per the government’s statement. This approach allows for production growth, with Environment and Climate Change Canada projecting a 16% production increase by 2030-2032 from 2019 levels, assuming companies implement decarbonization measures.

The pollution cap will regulate upstream oil and gas facilities—including offshore and liquefied natural gas (LNG) production—which account for roughly 85% of the sector’s emissions. Activities covered include: 

  • oil sands extraction and upgrading, 
  • conventional oil production, natural gas processing, and 
  • LNG production. 

As the world’s 4th-largest oil and 5th-largest gas producer, Canada aims to stay competitive in a decarbonizing global market. With demand for low-pollution fuels expected to grow, the emissions cap is positioned to help Canadian oil and gas producers adapt to shifting global demand while supporting national emissions targets.

As Canada targets a 40-45% emissions reduction below 2005 levels by 2030, it’s clear that the energy sector, which accounts for over a quarter of all emissions, is key to achieving its climate goal. 

Tug of War Over Emissions Limits

The cap on emissions, however, is being criticized by Alberta and the Canadian Association of Petroleum Producers (CAPP), who argue it’s essentially a production cap. They contend the policy could drive up prices, eliminate up to 150,000 jobs, and cost Canada’s economy up to C$1 trillion (US$720 billion). 

Alberta’s opposition reflects broader industry concerns that Canada could become the only major oil and gas-producing country capping emissions. They noted that this could potentially harm the nation’s competitiveness.

Greenpeace Canada’s Keith Stewart expressed that oil companies haven’t invested enough in pollution-reducing measures, underscoring the need for a strict cap. Conversely, Deloitte’s June analysis suggests that the cap may drive companies to cut production rather than adopt costly technologies like CCS, a solution proposed by some as a way to curb emissions without reducing output.

As the debate intensifies, it highlights the tension between ambitious climate policies and economic impacts on the energy sector and provincial economies. The final plan and its reception will be pivotal in shaping Canada’s climate and energy future.

Will Trump’s Re-Election Threaten Global Climate Progress Ahead of COP29 Talks?

Jennifer L
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0
Will Trump’s Re-Election Threaten Global Climate Progress Ahead of COP29 Talks?

Donald Trump’s recent election win has cast doubt over global climate efforts, with his victory sending ripples through the international community just a few days before the COP29 climate talks in Baku. Trump, who previously pulled the U.S. out of the Paris Agreement, has hinted at doing the same again. This is especially true given his pro-oil and gas stance in climate policy. 

His victory speech highlighted America’s vast reserves of “liquid gold,” emphasizing the country’s oil and gas resources over renewable energy alternatives. This move has caused climate activists to be concerned about how the world’s largest economy will respond to the climate crisis.

America’s “Drill, Baby, Drill” Resurgence with Trump’s Victory

Donald Trump’s victory signals a shift in U.S. climate policy, as he aims to undo numerous environmental actions implemented under Biden. In Dan Eberhart words, CEO of Canary LLC, Trump as the new president means: 

“You are looking at, overall, a ‘drill baby drill’ philosophy.” 

Bloomberg reported that Trump’s plans include reversing EV subsidies, limiting EPA pollution rules, and boosting fossil fuel production. Moreover, Trump could challenge Biden’s Inflation Reduction Act by modifying tax credits for clean energy, potentially making them harder to access or more favorable to fossil fuels. 

Internationally, Trump may withdraw the U.S. from the Paris Agreement and the upcoming UN Framework Convention on Climate Change (COP29). This would also mean sidelining the nation from climate negotiations while encouraging other countries to weaken their own emission goals. 

Meanwhile, some U.S. states and local governments are preparing alternative strategies to uphold climate progress, including discussions with Chinese officials to maintain subnational climate cooperation. Climate activists and leaders are also strategizing around Trump’s presidency to mitigate potential setbacks to climate action globally.

Will the EU Rise to the Challenge and Take Charge?

Many are now eyeing the European Union (EU) to fill the leadership void with the U.S. potentially stepping back. Climate Action Network Europe’s director, Chiara Martinelli, stressed the EU’s moral responsibility to address climate issues head-on. 

She also pointed out that the EU must support climate action in vulnerable regions, especially in the Global South. Countries in this region suffer the most from climate impacts despite contributing the least to the crisis.

  • COP29 is expected to focus heavily on establishing a new financial framework to assist poorer nations with their climate adaptation and transition efforts. 

COP29 Baku Azerbaijan

Laurence Tubiana, a former French climate diplomat who played a key role in the 2015 Paris Agreement, said the situation is reminiscent of Trump’s first withdrawal. However, she noted that today’s landscape is more favorable for renewable energy and environmental policy. This could help keep the momentum going, even without full U.S. involvement.

With Trump’s victory, the EU faces a renewed call to step up as the world’s climate leader. Patrick ten Brink, head of the European Environmental Bureau, noted that Trump’s administration has a record of environmental rollbacks, from weakening protections to supporting fossil fuels. With this, Brink remarked that: 

“With Donald Trump’s re-election, the EU must recognize the urgency of stepping up and scaling up as the global leader in climate and environmental policy.”

To solidify its stance, the EU must maintain a visible presence at COP29 to ensure that it actively participates and leads in policy discussions. Brink emphasized that Europe should also bolster its efforts to move forward with climate initiatives like Fit-for-55 and the European Green Deal. They aim to slash greenhouse gas emissions by 55% by 2030 and achieve net-zero emissions by 2050.

How Does Trump’s Climate Stance Could Impact COP29?

In light of Trump’s apparent opposition to climate action, there are fears that other countries might also avoid commitments if they see the U.S. walking away from the Paris Agreement again. Already, there are reports that leaders from major emitters will not attend COP29, while some may not attend.

Europe’s lawmakers hope the U.S. stance will not derail global climate ambitions. Trump’s influence might inspire some hesitation, but the global shift toward green technology and renewables provides an economic and environmental incentive that is difficult to ignore. 

Adding to these concerns, the recent announcement that European Commission President Ursula von der Leyen will not attend COP29 has sparked debates about EU leadership. French President Emmanuel Macron is also notably absent from the attendee list. 

Nonetheless, the EU Parliament plans to send a delegation, including Dutch lawmaker Mohammed Chahim. He commented on the “troubling signals” from the U.S. but encouraged climate policy advocates not to lose hope.

Chahim pointed out that the U.S. is not monolithic in its climate stance. Despite Trump’s previous exit from the Paris Agreement, American cities, states, and non-governmental organizations continued to engage in climate diplomacy. With green technologies now more affordable and financial incentives linked to emissions reductions, the U.S. may find it challenging to resist the green agenda, Chahim noted. 

With COP29 just around the corner, there’s renewed urgency for the participating nations to act decisively. The conference will attempt to strengthen financial commitments and establish a new goal to support the global south. 

Despite the uncertainty surrounding the U.S. involvement, COP29 organizers hope to secure meaningful agreements, with or without the backing of the world’s largest economy.

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