Carbon emission prices in the US Regional Greenhouse Gas Initiative (RGGI) have soared to unprecedented highs due to more stringent emission rules and fears that US President Biden will enact a fracking ban. In the latest RGGI quarterly auction, held on March 3, the clearing price hit $7.60 per ton of CO2.
A cross-section of 30 US shale oil and gas producers shows the industry has enjoyed the first full year of positive free cash flows since the fracking boom began. Energy Economics and Financial Analysis (IEEFA) found the 30 producers generated $1.8 billion in free cash flows in 2020 after slashing capital spending by $20 billion.
Japanese and Australian partners – J-POWER, Iwantani Corp, Kawasaki HI, Marubeni, AGL and Sumitomo – have launched the HESC Pilot plant that uses coal from Australia’s Latrobe Valley to produce hydrogen, destined for the Japanese market. The aim is to scale up the output of the HESC produce to 225,000 tonnes of hydrogen annually with CCS.
The Electric Highway Coalition – made up of American Electric Power, Dominion, Duke Energy, Entergy, Southern Co., and the Tennessee Valley Authority – plan to establish a network of electric vehicle (EV) charging stations to enable seamless travel between Gulf Coast, Midwest and Atlantic State destinations. Over 18 million EVs are estimated to be on US roads by 2030.
Italy’s gas network operator Snam will become Europe’s first TSO to test the injection of a hydrogen blend into its gas grid through a cooperation with UAE-based Mubadala Investment. Snam imports LNG via the FSRU Toscana and the onshore Panigaglia regas facility near Genoa, where carriers with the hydrogen-LNG blend from Abu Dhabi are likely to berth.
Withdrawals from US gas storage kept falling this week, with analysts attributing the storage-build to mild weather in South Central regions and a subsequent rise of gas injection into salt cavern storage. South Central was badly hit by the mid-February ‘Big Freeze’ in Texas but temperates already sprung back to a 10% warmer-than-normal March to-date.
Gazprom is reviewing its options to produce and utilize hydrogen in Russia, and export the fuel through its existing gas pipeline infrastructure. Grey hydrogen is cheaper to make for large natural gas producers such as Gazprom, and the Russian gas major is already in talks with Germany to add hydrogen to its gas deliveries through the North Stream-2 pipeline.
Joe M. Kang, President of the International Gas Union (IGU), has highlighted the role of natural gas as an enabler of the energy transition. Speaking at the 50th GECF Gas Lecture Series, he criticised the “lack of a global approach” on how to ensure clean, secure and affordable energy given that “renewables cannot yet replace hydrocarbons.”
Raising the Social Cost of Carbon (SCC) is seen as a tool for US Democrats to obstruct upstream gas projects, notably fracking leases. Energy Aspects believes the bar for federal approval of new fossil fuel infrastructure will rise once the Democrats gain majority of the Federal Energy Regulatory Commission (FERC) in July.