Green Markets - June 26, 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
Canada has enacted new rules under amendments to the Competition Act aimed at curbing greenwashing. The amended law prohibits public representations regarding a product's environmental benefits or a business's environmental impact unless these claims are substantiated by adequate and proper testing or internationally recognized methodologies. Penalties for violations are substantial, including fines up to $10 million or 3% of annual revenues, whichever is greater.
The Biden administration has allocated $275 million in funding via the Powering Affordable Clean Energy (PACE) program for renewable energy projects, primarily through the Inflation Reduction Act (IRA).
The U.S. Department of Agriculture is distributing $100 million in grants and loans through the Rural Energy for America Program (REAP) across multiple states, supporting energy efficiency projects like heating mats and LED lighting in Missouri and an energy-efficient grain dryer in New York.
Agritech/Agriculture
Denmark's coalition government has approved the world's first carbon emissions tax on agriculture, targeting dairy and pork farmers with an annual tax of 672 krone ($96) per cow beginning in 2030. Agriculture, the country's largest emitter, will face new levies as part of a broader initiative to invest 40 billion krone ($3.7 billion) in climate measures, including reforestation and wetlands establishment.
Battery Metals
Chile's state mining giant Codelco, one of the world's largest copper producers, faced challenges in May as it fell 8.6% short of its production target, according to an internal document obtained by Reuters. The company produced 103,100 metric tons of copper in May, below its target of 112,800 tons, highlighting difficulties in increasing output from a 25-year low.
Biofuels/Chemicals
Companhia Paranaense de Gás (Compagas) will invest €86.6 million from 2024 to 2029 to expand its operations in Paraná, Brazil. The investment plan, announced by Governor Carlos Massa Ratinho Junior, includes extending services to new regions, integrating biomethane into the gas network, and developing sustainable corridors with natural gas and biomethane supply.
Hygenco Green Energies, a green hydrogen plant operator, has signed a term sheet with Ameropa for potential supply from an upcoming plant in India. The first phase of that new plant in Odisha is expected to produce 600 tonnes per day of green ammonia. Commercial operations are anticipated to begin by 2027.
Braskem Siam, a joint venture between Brazil’s Braskem and Thailand’s SCG Chemicals PCL, has received approval from the Thailand Board of Investment (BOI) for a $1.54 billion investment to build a bio-ethylene plant. This plant, located in Map Ta Phut Industrial Estate, Rayong province, will produce up to 200,000 tons/year of bio-ethylene
ClearSky Global Corp. (ClearSky) has secured $168 million in funding from a private international ESG investment group advised by Tailwind Ventures. ClearSky intends to use the funds to implement its ECOGY® technology, which aims to produce high-quality, low-carbon aviation and transportation fuels that are economically viable.
Carbon Capture
Shell Canada Products, a subsidiary of Shell, has committed to developing the Polaris carbon capture project in Alberta, Canada. This project aims to capture 650,000 tonnes per year of CO2 from Shell's Scotford refinery and chemicals complex. Shell has also approved the Atlas Carbon Storage Hub in partnership with ATCO EnPower (50%), which will provide underground storage for CO2 captured by Polaris. Operations for both Polaris and the Atlas hub are expected to commence by the end of 2028.
Voluntary Carbon Markets (VCMs)
The UAE Carbon Alliance has signed a non-binding Letter of Intent (LOI) with the Africa Carbon Markets Initiative (ACMI)’s Advance Market Signal. This agreement pledges an indicative purchase of $450 million in African carbon credits by 2030. ACMI, incubated by Sustainable Energy for All (SEforALL), Global Energy Alliance for People and Planet (GEAPP), and The Rockefeller Foundation, aims to foster high-integrity carbon credits in Africa and enhance transparency throughout the voluntary carbon markets.
Liquified Natural Gas (LNG)
Saudi Aramco has signed a non-binding agreement with US LNG exporter Sempra to purchase 5 million tonnes per annum of liquefied natural gas (LNG) for 20 years from the second phase of Sempra's Port Arthur LNG export project in Texas. The agreement also includes Aramco potentially acquiring a 25% equity stake in the project's second phase.
Export Development Canada (EDC) has approved financing for the Cedar LNG facility near Kitimat, British Columbia, despite objections from environmental groups. The financing, part of a larger $5.5 billion project announced by Kitimat, includes an EDC loan estimated between $400 and $500 million.
Nuclear Energy
Ontario Power Generation (OPG) has launched a new Sustainable Finance Framework, replacing its 2021 Green Bond Framework, to broaden the scope of its green financing. This framework now allows proceeds from sustainable bonds to fund not only renewable energy projects but also new nuclear initiatives, including small modular reactors (SMRs) and large new nuclear projects. OPG, which issued over C$3 billion in green bonds to date, aims to support clean energy technologies and climate resilience projects.
Megha Engineering & Infrastructures (MEIL), an Indian multi-sector infrastructure firm, secured a $1.53 billion contract from the Nuclear Power Corporation of India (NPCIL). The contract involves constructing two 700 megawatts (MW) electrical reactors at Kaiga in Karnataka, marking NPCIL's highest-valued tender.
Renewable Energy
Avangrid (AGR) and Copenhagen Infrastructure Partners (CIP) have announced that the Vineyard Wind 1 project, located offshore Massachusetts, is now generating more than 136 MW of electricity. This milestone makes Vineyard Wind 1 the largest operating offshore wind project in the United States, with 10 turbines currently operational
VSB Group, a renewable energy developer, has announced that its subsidiary VSB Finland has obtained planning permission for the Puutionsaari wind project in the north Ostrobothnia region of northern Finland. This project will combine a 350 MW wind farm with a 100 MW solar array.
Investment Funds
H2O Innovation and Cycle Capital have launched the Cycle H2O Fund, a C$30 million venture capital initiative. It supports seed and early-stage watertech companies primarily in Québec and Eastern Canada, with a focus on sustainable agriculture, green chemistry, and digital water treatment technologies for industrial processes and conservation.
Start-Up Investments
Samsara Eco, a plastics recycling startup, has secured $100 million in a Series A+ funding round aimed at expanding its technology into Asia. The startup's process converts waste plastics into raw materials like nylon and polyester. Lululemon was one of the investors in this funding round.
Queens Carbon, a green startup in the cement industry, has been awarded $14.5 million by the U.S. Department of Energy’s ARPA-E under its SCALEUP program. This funding will support Queens Carbon in piloting its innovative low-temperature, zero CO2 technology in collaboration with a commercial partner within the cement sector.
Be.EV, an electric vehicle charging network, has secured £55 million in debt financing from NatWest and the German KfW IPEX-Bank. Be.EV plans to use the funds to expand its network, aiming to operate over 1,000 rapid and ultra-rapid charge points across the UK by the end of 2024.
Climate X, a climate risk intelligence company, has raised $18 million in a Series A funding round led by Google Ventures (GV). The funding round also included participation from Pale Blue Dot, CommerzVentures, A/O, Blue Wire Capital, PT1, Unconventional Ventures, and Western Technology Investment (WTI).