Good Morning. This is the Sunya Scoop. The newsletter that takes energy transition news and turns it into an easy-to-read email for you.
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HYDROGEN
Just when we thought Chevron would have the largest deal this week, the Saudi’s said…
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NEOM Green Hydrogen Company (NGHC) has achieved financial close on the world’s largest green hydrogen production facility, with a total investment value of $8.4 billion.
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NGHC is an equal joint venture between ACWA Power, Air Products, and NEOM, aiming to produce green ammonia at scale by 2026.
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The project is being financed through $6.1 billion non-recourse financing from 23 local, regional, and international banks and financial institutions.
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NGHC has secured an exclusive 30-year off-take agreement for all the green ammonia produced at the facility.
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The engineering, procurement, and construction (EPC) agreement for the project, valued at $6.7 billion, has been concluded with Air Products.
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The project will integrate up to 4GW of solar and wind energy to produce up to 600 tonnes per day of carbon-free hydrogen in the form of green ammonia.
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The financial close has been certified as adhering to green loan principles and is one of the largest project financings under the green loan framework.
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NGHC’s project aims to accelerate the adoption of green hydrogen and contribute to Saudi Vision 2030’s sustainable development goals.
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The construction of the facility is well underway, with production scheduled to begin by the end of 2026.
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Air Products will be the exclusive off-taker of the green ammonia produced, supporting decarbonization efforts in the transportation and industrial sectors.
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ACWA Power sees this project as a significant step toward accelerating the shift to clean energy and supporting Saudi Arabia’s decarbonization goals.
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NGHC’s financial agreements involve a diverse mix of local, regional, and international banks and financial institutions.
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NGHC was awarded its first industrial operating license by Saudi Arabia’s Ministry of Industry and Mineral Resources in January 2023.
CARBON REMOVAL
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JPMorgan Chase plans to invest over $200 million to purchase carbon removal credits, including a preliminary 15-year agreement to purchase about 450,000 tons from CO280.
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Climeworks, a Swiss company, will receive over $20 million from JPMorgan for carbon removal, aiming to remove 25,000 metric tons over nine years.
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Charm Industrial, a startup turning plant waste into a carbon-rich liquid, has removed about 6,000 tons to date, and JPMorgan is buying nearly 30,000 metric tons of removal from them over five years.
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JPMorgan commits to matching its operational emissions from consuming natural gas and other fuels with equivalent carbon removals by 2030.
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The bank aims to reduce its emissions by 40% by 2030 from 2017 levels.
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JPMorgan’s commitment to funding about 800,000 tons of removal is the second-largest purchase in the market’s history.
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Microsoft, in a separate deal, plans to pay for about 2.8 million tons of removal through a wood-chip-fired power station in Denmark operated by Ørsted.
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Removal credits can cost 100 times more than conventional carbon credits, and JPMorgan is willing to pay hundreds of dollars per ton for each removal credit.
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JPMorgan’s commitment includes providing clients with access to up to $25 million in carbon removal credits through the Frontier alliance and committing $50 million in purchases to neutralize its own emissions.
POWER AND UTILITIES
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California’s electric grid operator, CAISO, has approved a plan for 45 new power transmission projects expected to cost $7.3 billion over the next decade.
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The projects will support the development of over 40 gigawatts (GW) of new generation resources, including solar, wind, geothermal, and battery storage projects.
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The majority of the transmission projects will be built in California, with some in neighboring Arizona.
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CAISO will prioritize connecting power plants to the grid in specific geographical zones where it makes economic and operational sense.
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The grid operator is also implementing reforms to account for increasing levels of net load forecast uncertainty as the generation fleet evolves towards a cleaner, more variable resource mix.
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CAISO projects the need to add 70 GW of new power to the grid by 2033 and 120 GW by 2045 to achieve a carbon-free power system in line with the state’s goals.
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The vulnerability of power supply in the U.S. West to extreme heat was highlighted by the North American Electric Reliability Corp (NERC) due to reliance on regional energy transfers and solar output fluctuations.
ELECTRIC VEHICLES
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Volvo Group’s unit, Volvo Trucks, has secured a record order from Swiss building solutions provider Holcim for 1,000 electric trucks.
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This order marks the largest commercial order to date for Volvo electric trucks.
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The delivery of the trucks will take place over the next seven years, with the first 130 trucks, including the Volvo FH and Volvo FM models, scheduled for delivery in late 2023 and throughout 2024.
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The exact value of the order has not been disclosed.
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The trucks will be deployed in various European markets, including France, Germany, Switzerland, and Britain, to support Holcim’s operations.
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Volvo Trucks aims for 50% of its truck sales to be electric by 2030 and has experienced increased demand for electric trucks in recent quarters.
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To meet rising demand, Volvo Trucks is scaling up production at its plants in Sweden, France, and the U.S., with plans to start production at a Belgian factory in Q3 2023.
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All trucks in the Holcim order will be battery electric trucks (BEV).
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In addition to BEVs, Volvo Trucks, like other manufacturers, is also developing hydrogen-powered fuel cell trucks expected to enter the market in the latter half of the decade.
I guess they didn’t like the Tesla design…
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