Austria’s Verbund is looking to import Masdar’s green hydrogen to Central Europe

Good morning, lovely people, and welcome to the end of a fairly quiet week on the climate front.

THE BIG CLIMATE STORY- Austrian utilities company Verbund has inked an agreement with UAE’s Masdar to co-develop green hydrogen production in a bid to line up more exports of the green fuel for Central Europe. This comes a few short weeks after signing a similar agreement with KSA’s Acwa Power. We have chapter and verse on this story in the news well below.

THE BIG CLIMATE STORY OUTSIDE THE REGION- France and Germany go to Washington, as the endless EU-US debate over green subsidies continues: Meetings this week between France and Germany’s economy ministers and US Treasury Secretary Janet Yellen, Commerce Secretary Gina Raimondo and White House officials have yielded few concrete results, but a general willingness to engage over EU concerns about US President Joe Biden’s Inflation Reduction Act (IRA) and its impact on Europe’s green energy transition.

Few signs of concrete progress: Both sides agreed on the need for transparency about competing EU-US green subsidies, noted France’s Bruno Le Maire and Germany’s Robert Habeck. A commitment was also made for the US-EU Trade and Technology Council (TTC) to develop shared standards for green products, along with an agreement to look at ways of reducing reliance on China for minerals used in batteries, Habeck said.

But US officials remain non-committal: The US has indicated no major concessions following the meetings, with Raimondo reportedly noting that the IRA is a “key tool” for the US and its most significant climate legislation to date.

The story is attracting widespread coverage: Financial Times | Deutsche Welle | Le Figaro | Bloomberg | Wall Street Journal | Reuters | Politico

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WATCH THIS SPACE #1- Aramco works towards direct air capture tech at ＜USD 100/ ton of CO2 in green fuel production: Saudi Aramco is working on reducing the carbon intensity of green fuels through direct air capture (DAC) technology — with a target of bringing down the cost to below USD 100 per ton of CO2, Arab News quotes the firm’s transport Chief Technologist Amer Amer as saying at the International Association for Energy Economics (IAEE). USD 100/ ton of CO2 is the price at which DAC becomes economically viable, though it currently stands at an estimated two-six times higher. Tech development, regulation, and fiscal incentives or subsidies are all needed to develop greener transport, according to stakeholders speaking at the conference.

WATCH THIS SPACE #2- KSA’s chemical manufacturing company SABIC is sinking USD 1.3 bn into the second stage of its green transition, Arab News quotes VP of Energy Efficiency and Carbon Management Fahad Al-Shereby as saying at the IAEE. The funds will go towards tech innovation for energy efficiency aimed at reducing costs and advancing decarbonization, he added. SABIC saw a 10% decrease in carbon emissions during the USD 1 bn first phase of its energy transition, Al-Shereby said.

WATCH THIS SPACE #3– Egypt pitches projects to the EIB: Egypt’s Environment Minister Yasmine Fouad met with European Investment Bank Director Lionel Rapaille to explore potential climate-centered projects for the country’s private sector, according to a cabinet statement. Fouad and Raphael discussed waste-to-energy, waste management, and environmental and marine conservation projects and potential pathways for developing the local banking industry’s sustainable financing capacity.

WATCH THIS SPACE #4- The shift to EVs can’t meet the emissions threshold laid out in the Paris Agreement: Auto manufacturers are likely to create emissions surpassing the Paris-agreed 1.5°C global warming threshold by 2035, a report by EV automakers Rivian, Polestar, and consulting firm Kearney finds. The carbon emissions generated by passenger vehicles globally amounts to some 6 gigatons annually when accounting for total life cycle CO2 emissions leading to a total wallet of some 80 gigatons of CO2 equivalent by 2050, the report notes, with carmakers almost doubling warming levels by the same year relative to the current Paris-agreed target.

How did they come to that conclusion? The three companies collaborated on the development of a simulation test measuring emissions generated by the automobile industry against projections of CO2 levels that would lead to the overshoot of the 1.5°C warming threshold, and found the automakers would have to charge EVs entirely using renewables by 2033 and use clean energy across their operations — including in manufacturing and charging infrastructure production — to maintain warming levels below the Paris climate target.

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Exports and foreign direct investment (FDI) have never been more important to our economy — or our businesses — than in the wake of the float of the EGP. We think we have a once-in-a-lifetime chance to build an export-led economy that makes us a magnet for FDI and all the benefits that will come with it for our nation.

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CIRCLE YOUR CALENDAR-

Egypt will host the Egypt Petroleum Show from Monday, 13 February to Wednesday 15 February in Cairo. Under the theme “Supporting Sustainable Global Energy Supply and Demand,” the event will host talks on sustainable development, how climate change impacts oil and gas production, and decarbonization for net zero targets.

The UAE will host the International Conference on Effective Nuclear and Radiation Regulatory Systems from Monday, 13 February to 26 February in Abu Dhabi. This conference will host discussions on improving the effectiveness of nuclear and radiation regulatory systems and building resilience and agility in response to emerging challenges.

Egypt will host the CSR Forum from 2-5 March at Somabay, Hurghada. The event aims to further discussions put forth during COP27 and boost private and public sector cooperation on climate action. You can register for the event here.

The Arabia CSR Awards is accepting applications until Friday, 30 June. The awardwinners will be announced during a ceremony on Wednesday, 4 October.

The first MENA Solar Conference is accepting applications from published researchers specialized in PV technology until Sunday, 30 April. The Dubai Electricity and Water Authority will be hosting the conference from 15 to 18 November, in conjunction with the Water, Energy, Technology, and Environment Exhibition and the Dubai Solar Show 2023. Researchers can submit their papers here.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

Austria’s Verbund taps Masdar for green hydrogen imports: UAE renewables developer Masdar inked an MoU with Austrian utilities company Verbund to co-develop green hydrogen for Central Europe, according to a statement. The two companies will work together to produce and export green hydrogen to Central European countries, with a focus on Austria and Southern Germany.

The second GCC company tapped by Verbund for hydrogen imports: Tadawul-listed Acwa Power signed an MoU with the Austrian firm three weeks ago to explore the developments of green hydrogen projects in MENA for export. The green hydrogen produced would be distributed by Verbund in Central Europe, also with a specific focus on Austria.

One of many Masdar green hydrogen export plans to Europe: The Mubadala-owned firm signed an agreement with Germany’s Uniper last December to develop a green hydrogen plant in the UAE powered by 1.3 GW of solar energy. The plant is expected to generate green hydrogen by 2026 and the EU wants to import the clean fuel the facility will generate. The UAE-based firm also signed an agreement with the Port of Amsterdam, and Dutch firms SkyNRG, Evos Amsterdam, and Zenith Energy to explore the possibilities of green fuel exports to Europe on the sidelines of the Abu Dhabi Sustainability Week.

Where’s all that green hydrogen coming from? The renewables developer is aiming for a renewable energy capacity of at least 100 GW by 2030 with a production quota of up to 1 mn tons of green hydrogen. It ultimately plans to expand its renewable energy portfolio to over 200 GW, a company statement notes, without giving a time frame for this target.

About Verbund: The company operates hydroelectric plants in Austria and Germany — collectively handling some 130 facilities in both countries — and sourcing some 95% of their energy from renewable hydroelectric power, according to a company statement.

Saudi’s Kaust launches first mobile wastewater treatment unit: KSA-based water recycling firm Al Miyah Solutions — a subsidiary of Saudi’s King Abdullah University of Science and Technology (Kaust) — installed a first-of-its-kind mobile off grid waste water treatment unit at the NWC Wastewater Treatment Plant in Rabigh, Saudi Gazette reports. The new plug-and-play unit will treat and convert wastewater into reusable water for areas not connected to the centralized sewer network, filtering some 150 cubic meters of sewage water at half the energy consumption rate of traditional treatment methods, the news outlet notes.

How does it work? The new tech uses an aerobic granulation method that mobilizes toxins like phosphate and ammonium and transforms them into large blocks that can be easily separated from clean water, reducing operational costs compared to conventional separation processes that see the usage of microorganisms to remove pollutants from wastewater, Al Miyah’s founders told Saudi Gazette.

Who will it benefit? Some 40% of households in Saudi Arabia lack access to centralized sewage networks and Al Miyah aims to recycle their wastewater for horticulture, irrigation, and industry-driven applications in line with the Saudi Vision 2030 target to reuse 70% of water resources.

Kaust has more sustainability and decarbonization plans up its sleeve: The university signed an agreement with the Saudi Electricity Company last November to co-develop cryogenic carbon capture plants in KSA’s 605 MW integrated solar combined cycle power plant Green Duba, and signed a similar agreement in December with Neom’s water and energy subsidiary Enowa to develop a plant with a carbon capture capacity of 30 tons per day in Neom. It is also exploring the use of geothermal energy — a renewable source of energy that generates heat within the earth — with a series of experimental wells being dug on its premises.

Almost all growth in electricity demand in the next three years will be covered by low-emissions sources and nuclear power, the International Energy Agency (IEA) forecasts in a new report (pdf). Global electricity demand is expected to grow at an average annual clip of 3% through to 2025, with over 70% of demand increase coming from Asia, while CO2 emissions are likely to remain the same between 2022 and 2025. IEA Executive Director Fatih Birol said that renewables and nuclear power will meet most of the additional appetite, suggesting the world is close to a tipping point for power sector emissions.

The Middle East’s appetite for gas-fueled generation isn’t waning: Renewables will represent 35% of the global power mix in 2025 — a six percentage point increase from 2022 — and while the EU is seeing a decrease in natural gas-dependent power generation, there is still significant growth in gas-dependency in the Middle East. Gas accounted for 72% of electricity generation in the region in 2022 and is expected to rise to 77% in 2025. Similarly, declines in coal-fired power generation in Europe and the Americas are offset by increased coal usage in the Asia-Pacific region, even as nuclear power deployment rises in the latter. Emissions from Europe’s power generation are expected to decrease by c.10% annually until 2025.

The upside? The region’s CO2 intensity will decrease: Oil’s share of the region’s energy mix is expected to decrease to 14% from 21%, while coal is expected to drop to less than 0.3% from 1% — largely attributed to the conversion of the UAE’s Hassyan power plant from coal to gas and Israel’s decision to phase out coal by 2025. Nuclear power generation will almost double to account for 3.5% of the power mix between 2022 and 2025, with the expectation that it will reach 50 TW by 2025 — partly attributable to the UAE’s Barakah nuclear plant reaching full capacity in that time frame.

And the region’s renewable power generation will increase by half: Renewable power — led by solar developments in Saudi Arabia, Israel, Oman, and the UAE — will increase by 50% between 2023 and 2025, in spite of slow renewables expansion in other countries. Power generation emissions will fall by 2% in the forecast period with the UAE, Saudi Arabia and Israel seeing the largest emission declines due to decreased oil-fired generation and increased renewables and nuclear energy.

Countries across MENA and the GCC will experience a growth in electricity demand: Kuwait and Morocco’s electricity consumption is expected to grow at 2% annually from 2023-2025. In Qatar, demand is expected to grow by 3% while Jordan and Oman will both see a 2.6% increase in demand. Egypt’s demand for electricity is expected to increase 2.4% annually in the forecast period. Tunisia (3%) and Algeria (5%) top the list with the highest expected increase in demand between 2023 and 2025.

But UAE + Saudi will see demand growing at a softer pace: Saudi Arabia’s demand is expected to increase by 1% between 2023 and 2025 — a slower pace than the 2% recorded in 2022 — while forecasted electricity demand growth in the UAE is 2%, down from 3% in 2022. In the UAE, nuclear energy will lead alternative energy generation, while gas will make up 64% of the energy mix, renewables will make up 10%, and nuclear energy 26% by 2025.

The region is engaging in a renewables race: Renewable power generation in Kuwait accounted for just 0.3% but the country has plans to add 5 GW of solar capacity by 2030. In Israel, renewables are expected to reach 15% of the generation mix with coal-powered generation dropping to zero. Qatar expects solar energy to represent 4% of the mix by 2025 and Oman plans to generate 39% of its energy needs from renewables by 2040. Jordan aims to fulfill 50% of its energy needs from renewables by 2030 and announced plans last month to build small nuclear reactors for electricity production and water desalination

And North Africa wants to invest in renewables and export surplus: Egypt has 3.1 GW of installed wind and solar capacity, 2.8 GW of hydropower and 2.8 GW of planned renewable capacity being commissioned at the end of this year and plans to export electricity surplus to the Eastern Mediterranean, fulfilling local demand with diesel and renewables instead. Algeria is developing 15 GW of renewables’ capacity by 2035, with plans to export surplus to North Africa and Southern Europe.

Ford and Red Bull Powertrains are partnering up to develop a hybrid power unit engine for two Formula 1 racing teams ahead of the 2026 season, according to a company statement. Ford will contribute its expertise in battery cell, electric motor technology, power unit control software, and analytics, the statement notes.

The details: The unit will include a 350 kW electric motor and combustion engine that can be run fully on sustainable fuels, according to the statement. The power units will be used by the Oracle Red Bull Racing and Scuderia AlphaTauri teams from 2026 until at least 2030.

Racing to net zero: Formula 1 plans to be net zero by 2030 by switching to sustainable fuels and energy recovery systems for race cars and powering offices, facilities and factories with 100% renewable energy.