Regulation & Policy

Angela Merkel is under growing pressure to end her support for the German-Russian Nord Stream 2 pipeline project. Leading CDU party members and the Green party want the German Chancellor to halt construction after the poisoning of Russian opposition leader Alexei Navalny, especially because economists say the pipeline is “unnecessary” for ensuring supply security.

Germany’s federal and state governments have sealed a deal to make official the 40 billion Euros in state support for mining regions. The funding is dedicated to companies and regions worst affected by the landmark plan to exit coal-fired power generation by 2038 at the latest.

Northern Powergrid has become the UK’s first distribution network operator to release a strategy paper on how it can contribute to the country’s ‘green recovery’. The TSO, serving 8 million customers in the North East and Yorkshire, submitted its 2023-28 business plan in line with Ofgem’s ED2 price control regulatory period.

Utilities’ rising use of artificial intelligence (AI) accelerates Europe’s green energy transition. The greatest potential, according to Germany's energy agency (dena) lies in forecasting as well as optimising operations and inventories. dena CEO Andreas Kuhlmann said AI can “drive new business models, accelerate innovation and increase efficiency.”

The German government prepares to launch green ‘twin bonds’ with a volume of eleven billion Euros in a bid to attract investors to sustainable finance and raise funds for emissions reduction projects. From September, investors can swap government bonds with the new green bonds.

High costs of renewable electricity in Germany prevent the realisation of green hydrogen projects, says Nils Aldag, CCO of the Dresden-based startup Sunfire. In Norway, one of Sunfire’s electrolysis plant pays less than a quarter of German prices for using renewable energy as the basis of hydrogen production.

Latest ‘Future Energy Scenarios’ (FES 2020), published by UK’s National Grid strike a more confident tone that enough fossil and new technologies can be deployed to achieve the Government’s Net Zero by 2050 targets. At least two of four scenarios show pathways to accomplish this.

Exelon Corp has accused ISO New England of putting Boston’s power supply security at risk by “hastily” eliminating the out-of-market retention of Mystic Generating Station. Exelon filed to the Federal Energy Regulatory Commission (FERC) to bar ISO NE from making these changes.

Williams has received approval from the U.S. Federal Energy Regulatory Commission (FERC) to move forward with the Leidy South Project. The pipeline expansion will allow for further supplies, produced by Cabot Oil & Gas and Seneca Resources in Marcellus and Utica Shale, to be transported to the Mid-Atlantic region by winter 2021/22.

German Energy Agency dena has advised the Government to support households by lowering the renewable surcharge they pay with their power bills, also known as the EEG levy, to zero by 2021. The resulting lower electricity prices would help stimulate private consumption.

Global Reporting Initiative (GRI) has launched a 90-day public comment period for its 2020 Oil and Gas Sector Standard as momentum to replace fossil fuels is gaining traction. GRI standards focus on sustainability, widely seen as the industry’s “single biggest challenge”.

The German Parliament has adopted a law that ensures the phase-out of coal power by no later than 2038. Several reviews throughout the 2020s will assess progress on the build-out of wind and solar power as the end date for burning lignite could be brought forward to 2035.

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News in Brief

Mitsubishi produces methanol in Trinidad

Jan 20 – Mitsubishi Gas Chemical Company has launched commercial operations of a methanol and dimethyl ether plant in Trinidad and Tobago. The plant has an annual production capacity of one million tons of methanol and 20,000 tons of dimethyl ether, which can be used as an alternative fuel for cars and power generation.

First 8-cylinder B36:45 engine delivered

Jan 19 – Rolls-Royce has delivered the first 8-cylinder variant of its Bergen B36:45 gas engine to a tomato producer in Belgium. The medium speed genset is planned for delivery this spring and will drive an onsite power plant that generates 4700 kW electricity and 5520 kW heat. The new engine offers a 20% increase in power per cylinder and will replace an existing Bergen 12-cylinder B35:40 genset.

Moody’s upgrades Enel to Baa1

Jan 18 – Moody’s Investors Service has upgraded Enel’s long-term rating to Baa1, with a stable outlook. The upgrade reflects Enel’s progress in reducing its risk profile, analysts said, pointing at the Italian utilities ongoing investment in networks and renewables, growing geographical diversification and focus on centralised financing.

GE sues Siemens Energy

Jan 15 – General Electric has sued its German rival Siemens Energy over the alleged use of stolen trade secrets to win gas turbine contracts worth several billion dollars. GE told the US district court in Virginia that Siemens received the secret information from a Dominion Energy employee.

Orbital Energy launches Eclipse

Jan 14 – Nasdaq-listed Orbital Energy Group has launched a new subsidiary, Eclipse Foundation, a drilled shaft construction company. The new company specialises in providing services for power transmission and substations, communication tower and a disaster restoration through emergency power.

S’Korean coal and LNG imports slide

Jan 13 – South Korea’s imports of thermal coal and LNG have fallen 12% and 11%, respectively, as the government cracks down on fossil fuel usage to curb air pollution. Customs data shows that coal imports amounted to 10.2 million tons in December, down 1.4 million tons from the same month last year but up from November’s imports of 9.5 million tons.

SMC builds 1.7 GW CCGT in Batangas

Jan 13 – Excellent Energy Resources, part of SMC Global Power Holdings, is building a 1,700 MW combined cycle gas power plant in Barangay Dela Paz and Ilijan in Batangas City with investments of about 67.863 billion Philippine Pesos ($1.41bn). The project is estimated to be completed in 36 to 40 months.

UK’s National Grid issues supply warning

Jan 12 – Natural gas prices in the UK surged as National Grid issued warnings on supply deficit as LNG cargoes are being diverted to North Asia. Prices at the British NBP gas trading hub soared to the equivalent of $8.95 per MMBtu, while the JKM price for North Asian spot LNG cargoes for February 2021 was last at $19.700 per MMBt.

Fortistar invests in hydrogen

Jan 11 – Fortistar, a privately-held fund, has joined an equity investment of up to $157 million in hydrogen producer BayoTech. Cottonwood Technology Funds and the New Mexico State Investment Council also participated in the latest financing round. BayoTech’s systems produce local hydrogen close to the application, serving end users in the industrial gas and petrochemical segment as well as those who use of hydrogen to power fuel cells.

Ashtead appoints new CFO

Jan 5 - Ashtead Technology has appointed a chief financial officer (CFO) and five managers for newly created roles across its international team. The appointments are meant to cement the company’s position in the offshore energy market, including offshore wind and decommissioning of thermal power plants

NFE secures LNG for Puerto Rico, Mexico and Nicaragua

Dec 23 – New Fortress Energy (NFE) has agreed to purchase Henry-Hub-indexed LNG for its integrated gas and power businesses in Puerto Rico, Mexico and Nicaragua. The New York-based project developer said it now has covered 80% of its expected needs throughout Latin America, thus reducing its need for spot purchases and its exposure to changes in the market price for LNG.

China and Korea mandate coal-to-gas switch

Dec 22 – The Chinese government has launched a coal-to-gas boiler switching programme, targeting 7.1 million homes, which makes gas demand more weather-sensitive this winter. Similarly, South Korea mandated the closure of 15 coal-fired plants since the start of December in an effort to reduce air pollution. Analysts expect this will accelerate the drawdown of LNG terminal inventories going into Q1-2021.

GE repowers oil field in Brazil

Dec 21 – GE Power Conversion has been awarded a contract by Sulzer Pumps UK to supply motors for four water injection pumps of a Floating Production Storage and Offloading (FPSO) vessel. The 8,000 kW, two pole motors will run at 3,600 rpm with a limitation of the starting current at 300%, enabling the oil and gas field operator to optimise the generator which supplies electricity on the FPSO.

VELO distributes Sapphire Metal 3D-Printers in the US

Dec 18 – California-based VELO3D has formed a distribution partnership with GoEngineer for Flow pre-print software, Sapphire metal AM printer, and Assure quality assurance and controls. GoEngineer will be VELO’s only distributor in the United States.

Indian electric boats to achieve zero emissions

Dec 17 – Cochin Shipyard, India’s largest shipbuilder, has asked Siemens Energy to equip India’s first fleet of 23 boats with electric propulsion drive train, integrated with batteries and vessel automation. Combining the electric propulsion drive trains, energy storage, and automation systems is expected to significantly reduce fuel consumption.

Terna BESS auction six times oversubscribed

Dec 16 – A pilot auction, held by the Italian TSO Terna, for battery energy storage systems (BESS) to provide reserve grid services has been six times oversubscribed. The auction was held with an expectation that around 230 MW would be on offer, but Terna received 1,327 MW worth of bids and eventually awarded contracts for 249.9 MW.

New £150m link to UK’s Easington terminal

Dec 15 – National Grid has completed a gas pipeline under the River Humber, build in 18 months and at a cost £150 million, as new link to the import terminal at Easington. Following commissioning, the pipeline is now operational and can now transport between 70 to 100 million cubic metres - around a quarter of Britain's gas needs.

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