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BNP Paribas sets out rules for coal financing phase out

BNP Paribas sets out rules for coal financing phase out

In a string of new measures unveiled yesterday, the bank has tightened its rules on providing finance to companies invested in coal, giving European firms until 2021 to align their coal strategies with a 2030 exit date.

Companies planning to build new coal-fired power plants will no longer be able to get financing from BNP Paribas, following the banking giant's introduction of a string of new policies aimed at eliminating its exposure to coal-fired electricity projects.

In an update to its coal sector policy published earlier this week, the French bank has vowed to stop financing companies this year that would contribute to new coal-fired electricity plants - whether through purchasing, the expansion of existing plants, or the construction of new ones.

South-Korea's KEPCO, Japan's Marubeni and Indonesia's PLN, which received $600m, $299m, and $65m respectively from the bank between 2017 and September 2019 according to campaign group CoalExit, will soon no longer be eligible for support.

Under its new rules, BNP Paribas will only provide financing to companies that have adopted a clear coal exit strategy with a timeline that wil lead them to no longer possess or operate coal-fired assets in EU and OECD countries before 2030, and in all other countries before 2040.

The bank confirmed it would start excluding companies planning new coal capacity or without a publicly-defined coal exit date from this year. It has given other firms until 2021 to reconsider their coal exit dates and align them with 2030 or 2040 goals.

In other words, in order to be eligible for continued financing from BNP Paribas, European energy companies now have until 2021 to adopt a full coal power exit plan in line with BNP Paribas' 2030 objective.

Kaarina Kolle, senior coal finance and utility coordinator at green campaign group Europe Beyond Coal, applauded the news. "BNP Paribas has been one of the staunchest supporters of European coal power utilities over the years," she said. "Finally, we can close that chapter as the bank's former clients RWE, CEZ and Fortum/Uniper will no longer be benefitting from financial services unless they commit to closing their coal business by 2030."

BNP Paribas granted €185m to Germany's RWE, €150m to Czechia's ČEZ, and €1,263m to Finland' Fortum between November 2018 and December 2019, according to research set to be published by Europe Beyond Coal campaign this month.

The bank said under its new policy it will monitor companies' exit strategies annually to ensure they are still on track to meet their coal exit timeline.

Lucie Pinson, founder and executive director of Reclaim Finance, commended the ambition contained in BNP Paribas' new policies and urged the bank to ensure they were implemented effectively.

"We applaud the immense progress made by BNP Paribas today and call international banks to follow," she said. "However, we will remain extremely cautious when looking at the implementation of the bank's new policy. A failure to effectively translate the policy into clear actions could neutralise its impact. Last but not least, it's now time to adopt similar criteria on coal mining and infrastructures in order to make its coal exit complete".

Reclaim Finance warned that BNP Paribas has not adopted any immediate or strict inclusion criteria for its existing clients, and noted that the new policies' success depended on the bank's efforts to diligently follow through on its commitment to suspend all new financial services to companies that fail to adopt a credible coal exist strategy.

Centrica throws weight behind UK heat electrification drive amid hydrogen cost fears

Centrica throws weight behind UK heat electrification drive amid hydrogen cost fears

British Gas owner says UK should target one million heat pumps by 2025 as it fears hydrogen domestic heating may be a decade away

British Gas owner Centrica has called for a national heat pump installation drive over the next decade in order to meet the UK's 2050 net zero target, arguing that a "proven technology [that is] available today" compares favourably with longer term and potentially costly plans to switch the gas network to green hydrogen.

The energy giant yesterday set out its top priorities for delivering net zero emissions by 2050, offering the stark assessment that the UK is "not on course to meet our fourth carbon budget commitments to decarbonise homes and transport emissions". As such it called for a raft of new green policy interventions that could help accelerate decarbonisation efforts and boost the economy as it seeks to recover from the coronavirus crisis.

In a briefing note, Centrica called for the UK to set a goal to install one million heat pumps and hybrid electric-gas heat pumps by 2025, backed by a scrappage scheme for oil boilers, which it described as the "most polluting heating systems".

It also called for the Future Homes Standard - which is expected to ensure all new homes are fossil fuel free from 2025 - to be brought forward to next year, and argued that there should be an increase in support for green heating schemes and closer links between energy efficiency schemes and low carbon heating policies.

The government this week extended a deadline under the Renewable Heat Incentive scheme that will give households and businesses more time to install green heat systems under the subsidy scheme. But many within the industry have warned the government's current support mechanisms with the sector remain badly underpowered when compared to the UK's decarbonisation goals.

Centrica's new paper argued the government's promised £9.2bn investment in energy efficiency over the coming parliament should support a wide range of green home upgrades to being them up to EPC band C, including making households "heat pump ready where appropriate".

Backing low carbon heating - such as heat pumps - as well as energy efficiency efforts would be a "no-regret intervention" for customers, while also delivering cost savings, driving momentum into the nascent low carbon heating market, and providing new job opportunities, the firm argued.

The company also waded into the debate over whether the UK should seek to decarbonise heating systems through the widespread use of heat pumps and other technologies or through a shift to hydrogen as the main source of gas for households. Centrica argued that ploughing money into transforming the UK's gas grid to run on green hydrogen in order to provide low carbon heating "is likely more than 10 years away, with the costs to customers as yet unknown".

It marks a significant intervention from the energy firm, which as the parent company of British Gas, is arguably seen as having a strong interest in maintaining the existing gas network in the UK.

Decarbonising the UK's heating systems remains a major challenge for delivering net zero, and the Energy Networks Association (ENA) recently set out a £900m plan with a major focus on transforming existing fossil fuel gas infrastructure to enable the wider use of hydrogen and biomethane to heat homes and businesses.

But Centrica argued the short term focus, particularly in the wake of the economic disruption wrought by Covid-19, should be on installing heat pumps to provide low carbon domestic heating backed by efforts to bring the UK's 19 million fuel poor homes up to scratch on energy efficiency over the coming decade.

"We must drive momentum into the low carbon heating market to deliver cost savings and provide job opportunities," the firm's policy briefing states. "We need to demonstrate that heat pumps can be both cheaper and greener for customers, with the right support and in the right homes."

"Heat pumps are a proven technology, and available today - progress must be made," it continues. "Our British Gas business has the customer knowledge and relationships, engineering workforce, training facilities, and know-how to get heat pumps right for customers. We are already progressing plans to trial hybrid heat pumps with our customers."

Centrica also called for the sale of new petrol and diesel cars to be phased out by 2030, bringing forward the UK's current target of 2035 in a move that should be backed by continued funding to support the rollout of much needed EV charging infrastructure over the next decade.

Moreover, it urged the UK government to come publish its long awaited Energy White Paper, which it said should prioritise grid flexibility, arguing EVs, heat electrification, and renewable generation "all require system flexibility if they are to operate at least cost for customers".

The briefing comes as Chancellor Rishi Sunak prepares to unveil what is hoped will be a stimulus package with a strong focus on supporting the growth of the green economy next week, following Boris Johnson's speech on Tuesday promising £5bn of support for the economy, including funding for a 'Jet Zero Council', tree planting, and direct air carbon capture technology.

The Prime Minister also revealed that the Energy White Paper and National Infrastructure Strategy would both be published in the autumn, sparking criticism from green groups who have argued the government now needs to urgently fast track a host of properly funded climate policy interventions to help drive a 'green recovery'.

Centrica's briefing paper joins a stack of reports and proposals in recent weeks calling on governments around the world to prioritise climate action in their economic stimulus packages as a means of driving an effective and sustainable recovery from the coronavirus pandemic.

Just today two new studies highlighted how green policy measures and programmes could create millions of jobs in the UK, while yesterday Gita Gopinath, economic counsellor at the International Monetary Fund, urged MPs to "do public investment that also addresses the need for a greener planet, and at the same time [deliver] a jobs-rich recovery".

Vattenfall gets green light for 1.8GW Norfolk Vanguard offshore wind farm

Vattenfall gets green light for 1.8GW Norfolk Vanguard offshore wind farm

BEIS gives nod to huge 1.8GW wind farm proposed by Swedish energy company, as it delays approval for Ørsted's Hornsea Three project for the fourth time

Vattenfall has been given the all clear to build the mammoth 1.8GW Norfolk Vanguard offshore windfarm off the east coast of England.

Planning consent was granted earlier this week by Business Secretary Alok Sharma, following a decision in June to postpone the decision by a month.

The Swedish energy giant intends to install between 90 and 180 turbines across an area of just under 600 square kilometres located 47 kilometres from the Norfolk coast. The project is expected to generate enough power for roughly 1.95 million homes.

Gunnar Groebler, senior vice-president for Vattenfall's wind business, said the firm was delighted to clinch planning consent for the development, which is scheduled to come online in the mid-2020s.

"This decision justifies the confidence that we have in the offshore wind sector in Britain, and we're looking forward to developing the project and benefiting the local community," he said.

"Decarbonising our economies starts with one of the most essential resources - electricity," he added. "Today's news sends a strong signal that the UK is serious about its climate ambitions and is open for business to power a green economic recovery." 

Vattenfall had previously questioned the government's plans for the offshore wind sector after suffering a second round of delays to the Norfolk Vanguard project last month.

Norfolk Vanguard's sister project, the proposed 1.8GW Norfolk Boreas farm, has also been stung by significant delays to the government consenting procedure. In May, the Department for Business, Energy, and Idustrial Strategy (BEIS) extended the examination period by five months to October, citing the cancellation of hearings due to the coronavirus.

Danielle Lane, country manager and head of offshore wind for Vattenfall in the UK, urged the government to speed up its approvals process. "It's now vital that other shovel-ready renewable and low-carbon projects are also given the go-ahead as soon as possible," she said. "Delays of even just a month or so can set back big infrastructure developments by years in some cases. The UK has to go much further, much faster, if it's going to reach its net zero targets."

Lane stressed that the offshore wind projects promised to deliver a significant boost to the local economy. "Today is also great news for people living locally, who we've been working with over the last four years to develop this project," she said. "They can look forward to a multi-billion pound economic boost, bringing with it hundreds of new long-term jobs, driving forward a green revolution and helping to level up UK opportunities."

The developer expects Norfolk Vanguard to generate more than 400 jobs in the onshore construction phase and a further 150 jobs once operational, once combined with Norfolk Boreas' workforce.

Hugh McNeal, chief executive at trade body RenewableUK, commended government's decision to approve Norfolk Vanguard and urged it to reach a similar conclusion for Ørsted's 2.4GW Hornsea Three project, which was subjected to further planning delays this week.

"Investments in major clean energy projects like these are great examples of how we can get the economy moving again, and the Secretary of State's announcement will boost our ability to meet the government's 2030 target of 40GW of offshore wind," McNeal said. "The landmark decision on Norfolk Vanguard means the UK is taking a significant step closer towards our net zero emissions target, and confirmation of a positive decision on Hornsea Three will get us there even faster."

In a blow for the Danish energy developer, BEIS extended the deadline for its decision on the 300-turbine Hornsea Three project to 31 December 2020 for the fourth time on Tuesday.

Sharma confirmed, however, that he was "minded to approve" the project, subject to further information being submitted by the Danish energy company by the end of September. The new decision date, BEIS said, would allow time for further consultations with interested parties after the new information was provided.

Carbon Clean Solutions closes $22m funding round

Carbon Clean Solutions closes $22m funding round

Carbon capture and separation technology pioneer pulls in backing from oil and gas giant Equinor in second major funding round

UK-based carbon capture specialist Carbon Clean Solutions Limited (CCSL) has today announced that it has closed a new funding round, pulling in $22m of investment from Equinor Ventures and ICOS Capital.

The Series B funding round sees the two new investors join WAVE Equity Partners, Chevron Technology Ventures, and Marubeni Corporation, who injected $16m into CCSL in February.

The latest funding marks a further vote of confidence in CCSL, which is working to commercialise what it describes as an affordable carbon capture and separation technology.

The firm has developed a carbon capture system that has been deployed at demonstration scale in over 10 locations, including the UK, US, Germany, India, Norway, and the Netherlands, and is currently in use at the world's largest industrial-scale carbon capture and utilisation plant in Tuticorin, India.

The company said the new funds would be used to grow the team and deliver its technology for carbon capture, utilisation and storage (CCUS) projects across the steel, cement, waste management and refining and petrochemicals sectors.

It is also working on a new "containerised" solution that it predicts could achieve $30/tonne cost of CO2 capture not including carbon credits by 2021.

"As the world tries to recover from an unprecedented pandemic, achieving net zero ambitions remains a top priority for a green recovery," said Aniruddha Sharma, CEO of CCSL. "This investment demonstrates the need felt by major industrial companies for break-through technology in the carbon capture space. We look forward to working with our investors and partners to support a number of CCUS projects in the coming months to limit the climate impact of the use of fossil fuels."

He added that carbon capture technologies had a critical role to play in enabling a net zero emission economy. "While renewable energy is growing exponentially, decarbonising heavy industry will be equally or more challenging," he said. "That is exactly where our innovative and modularised technology will play a fundamental role."

The deal was also welcomed by Gareth Burns, VP Equinor Ventures, who said the investment underlined the energy giant's commitment to the clean energy transition, despite the impact of the coronavirus pandemic and falling oil prices.

"We are pleased to invest in CCSL as it supports Equinor's journey towards carbon neutrality," he said. "CCSL is well positioned to further drive down cost ensuring CCUS is a viable option for more industrial players… People are concerned that Covid-19 and the oil-price drop may push Equinor to delay climate action. The reality is rather the opposite; Equinor is committed to accelerating emission reduction and using CCUS to decarbonise multiple industrial sectors. This investment confirms and supports this commitment."

As unemployment mounts, research points to 1.6 million green jobs opportunity

As unemployment mounts, research points to 1.6 million green jobs opportunity

Prioritising green homes, tree planting, and charge points could help tackle mounting job losses, according to new reports from IPPR and REA

Investing in a green recovery could create as many as 1.6 million jobs in the UK as the country strives to bounce back from the coronavirus crisis, delivering greener homes, cutting greenhouse gas emissions, and restoring nature in the process, according to a new study from the Institute for Public Policy Research (IPPR).

A fresh analysis today from the think tank examines a range of low carbon jobs and industries it suggests can help kick-start the UK economy after Covid-19, arguing that supporting green jobs up and down the country could stave off the worst of the impending recession in the UK.

Without government intervention, it warned, unemployment could surge by more than 2.1 million in the coming months, amounting to almost 10 per cent of the UK workforce. But it estimated investing in green jobs could help tackle around three-quarters of these projected job losses.

Joining the growing chorus of calls for the government to prioritise investment in energy efficiency in its forthcoming stimulus package, IPPR said renovating draughty homes and preparing them for low carbon heat pumps and district heating systems, while also building new zero carbon social homes, could generate 560,000 jobs alone.

Moreover, investing in green public transport systems, such rail upgrades, electric buses, electric vehicle charging networks, and cycling infrastructure, could create more than 230,000 jobs, while tree planting and peatland restoration could add another 46,000 jobs.

And, supporting the growing need for social and healthcare over the next decade could deliver another 700,000 jobs, it said, in total opening up opportunities for 1.6 million new jobs as the recession kicks in.

It follows research earlier this week estimating up to 2.2 million Britons may need retraining or reskilling to prepare the workforce for the transition to a net zero economy by 2050.

Meanwhile, the government's furlough scheme, which has effectively paid the wages of millions of British workers unable to do their jobs during the pandemic, is set to come to an end in October, fuelling fears that a surge in unemployment is imminent.

This week Prime Minister Boris Johnson promised a £5bn economic stimulus that included a raft of investments in the green economy, but concerns remain that the range of stimulus measures unveiled by the government to date does not match up to the scale of the impending crisis. More measures are expected to be announced by the Chancellor, Rishi Sunak, next week with speculation mounting that new funding for energy efficiency programmes, green transport, and low carbon industrial projects could be in the pipeline.

Carys Roberts, IPPR executive director, called on the government to increase its investment commitments in order to safeguard the economy in the short term and set the foundations for decarbonisation in the long term.

"The UK faces an unprecedented economic crisis," she said. "As well as protecting businesses and workers, it is vital that the government sets out a plan for the economy of the future. Tackling the climate and nature emergency must be at the heart of this plan, so that we don't leave one crisis to plunge headlong into another.

"Our report sets out the clean jobs that could provide good-quality, well-paid work over the next decade, if the government acts - from retrofitting houses to be energy efficient, to social care."

The analysis comes alongside the results of a new survey of 2,100 UK adults released by IPPR today, which pointed to significant public backing for investments in green jobs and industry going forward in order to tackle the climate crisis.

Carried out by Savant ComRes, the poll found 74 per cent agreed actions to address climate change could help create jobs and opportunities for the UK, while 67 said the same for their local community.

In addition, 71 per cent said the government should spend less on actions that worsen climate change, while 65 per cent supported loans or grants being offered to help people buy electric cars, and 66 per cent favoured subsidies to help make public transport cheaper.

The report came as renewable energy trade body the REA separately released its own blueprint for a green recovery, which also called for energy efficiency to be a major focus of the government's stimulus package.

In order to build a net zero economy, the REA said low carbon heating and home retrofits should be the immediate focus in the government's recovery plans, as well as reforms to the tax system such as business rates and VAT to support green products and services.

It also urged the government to take actions locally to meet net zero goals, by funding local authorities to upgrade local government buildings such as schools, hospitals, and care homes.

These efforts alone - reforming the tax system and delivering greener homes - could create as many as 176,000 new jobs, while also saving consumers £270 on bills every year and boosting the UK economy to the tune of £7.5bn, it estimated.

REA chief executive Nina Skorupska slammed the government's announcements so far as "underwhelming" and lacking in details, arguing it was "no longer enough to support a net zero economy in rhetoric alone".

"As 2050 approaches, the window to meaningfully address climate change becomes smaller and smaller," she warned. "We ask the government to recognise this and adopt the policies outlined in the report during the Chancellor's update next week."

With thousands more job losses announced just yesterday by a handful of major UK firms as the economy reels from the impacts of the recession, it is clear that livelihoods up and down the country are already taking a major hit even before the furlough scheme is wound up in the autumn.

Yet at the same time, compelling evidence continues to mount from business groups, think tanks, and MPs that investing in the green economy and 'shovel-ready' infrastructure projects such as housing renovation, EV charge points, and tree planting programmes could deliver a much-needed jobs boost up and down the country at a time when it is needed most.

Few details have yet emerged from the government's proposed stimulus package beyond plans for a 'Jet Zero Council', investing in direct air carbon capture technology, and a reiteration of a pledge to plant 75,000 acres of trees every year by 2025.

But as job losses begin to mount, hopes are high that the public support for green investment underlined by today's IPPR poll will be heard loud and clear at the Treasury before the Chancellor delivers his crucial update next week.

Lucozade Ribena Suntory targets net zero emissions across entire value chain

Lucozade Ribena Suntory targets net zero emissions across entire value chain

Company strengthens 2050 environmental vision with pledge to work with suppliers to slash emissions

Lucozade Ribena Suntory has extended its emissions target, with the announcement yesterday of a new target to achieve net zero greenhouse gas emissions across its entire value chain by 2050.

The company said it already has a science based target for 2030 for the European arm of its businesses - Suntory Beverage and Food Europe (SBFE) - but it will now work to slash emissions from its suppliers.

SBFE said that it would "implement renewable energy solutions, use next-generation infrastructure options and work together with supply chain stakeholders to contribute to realising a carbon-free society".

In addition, it stressed that it would continue with its internal emissions reduction efforts, which have seen the company invest in new energy efficient production lines, use more sustainable packaging materials, and switch to renewable energy purchase agreements.

"The drive toward zero carbon across our entire value chain by 2050 requires not only commitment and innovation, but also a willingness to challenge accepted wisdom," said Michelle Norman, director of external affairs and sustainability at Lucozade Ribena Suntory. "We see a key role for sustainable packaging in helping us meet our net zero carbon ambition, knowing that CO2 emissions from recycled plastic (rPET) production are approximately 50 per cent lower than those from manufacturing virgin plastic.

"We are determined to go further, with the elimination of all fossil-fuel based plastic from our bottles by 2030, which is just one key milestone on the route to net zero carbon emissions by 2050."

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