2025-01-10 20:37
Guidance lacks critical details for biofuel producers, says biofuel trade association CEO Climate model to be released soon, excludes climate smart agriculture practices Trump plans to repeal Inflation Reduction Act, needs congressional support Jan 10 (Reuters) - The U.S. government on Friday released short-term guidance on how companies can secure clean fuel tax credits under the Inflation Reduction Act, but fell short of finalizing the program's key details. Biofuels groups are eager for clarity on the tax credits for fuels that combat climate change, which they hope will ultimately provide a pathway for corn-based ethanol to expand its market as a feedstock for sustainable aviation fuel. The U.S. Treasury Department issued the guidance , opens new tab, saying it provides new details on how to ensure fuels meet certain emissions-reductions criteria to access the subsidy, and adding that a crucial climate model upon which the program relies will be available in the coming days. "This guidance will help put America on the cutting-edge of future innovation in aviation and renewable fuel while also lowering transportation costs for consumers," said Deputy Secretary of the Treasury Wally Adeyemo. "Decarbonizing transportation and lowering costs is a win-win for America." Biofuels groups were less enthusiastic, saying the guidance left several final decisions to President-elect Donald Trump's administration. "This long-overdue guidance is far from complete - it still lacks the critical details that are needed to help ensure that American biofuel producers and their farm partners can lead the world in clean fuel production," said Growth Energy CEO Emily Skor. Reuters reported earlier on Friday that the administration intends to release the program's climate model next week, but that it will not include adjustments for so-called climate smart agriculture practices - like no-till farming - which the ethanol industry hoped it could use to meet lifecycle emissions requirements. "While we appreciate the work of (U.S. Agriculture) Secretary (Tom) Vilsack to champion our issues on behalf of rural America, today’s announcement falls short of providing the information that our industry and its farm partners need, including a model for an expanded number of eligible decarbonization technologies and guidance on climate smart agriculture (CSA) practices," Skor said. "We look forward to working with the next Administration to fill in the gaps left by today’s announcement," she said. Trump has vowed to repeal Biden's 2022 Inflation Reduction Act, which launched the program, to pay for the extension of his tax cuts, but doing so would require support from Congress. Biden’s administration set a target to generate 3 billion gallons of sustainable aviation fuels by 2030. Air travel contributes around 2.5% of global greenhouse gas emissions, making it a big target in the fight against climate change. Sign up here. https://www.reuters.com/sustainability/climate-energy/us-issues-partial-guidance-clean-fuel-subsidies-chafing-ethanol-makers-2025-01-10/
2025-01-10 20:29
C3S confirms first year above 1.5C since pre-industrial times Climate change impacts, severe weather visible globally Political will to curb emissions wanes despite rising climate disasters BRUSSELS, Jan 10 (Reuters) - Global temperatures in 2024 exceeded 1.5 Celsius above the pre-industrial era for the first time, bringing the world closer to breaching the pledge governments made under the 2015 Paris climate agreement, scientists said on Friday. The World Meteorological Organization confirmed the 1.5C breach, after reviewing data from U.S., U.K., Japan and EU scientists. "Global heating is a cold, hard fact," United Nations Secretary-General António Guterres said in a statement. "There's still time to avoid the worst of climate catastrophe. But leaders must act – now." The bleak assessment came as wildfires charged by fierce winds swept through Los Angeles, with 10 people dead and nearly 10,000 structures destroyed so far. Wildfires are among the many disasters that climate change is making more frequent and severe. The European Union's Copernicus Climate Change Service (C3S) said climate change was pushing the planet's temperature to levels never before experienced by modern humans. Scientists have linked climate change to greenhouse gas emissions, mainly from burning fossil fuels. The planet's average temperature in 2024 was 1.6 degrees Celsius higher than in the 1850-1900 pre-industrial period, C3S said. The last 10 years are the 10 hottest years on record, the WMO said. Climate change is worsening storms and torrential rainfall, because a hotter atmosphere can hold more water, leading to intense downpours. Atmospheric water vapour reached a record high in 2024, and the U.S. National Oceanic and Atmospheric Administration said it was the third-wettest year on record. In 2024, Bolivia and Venezuela suffered disastrous fires, while torrential floods hit Nepal, Sudan and Spain, and heat waves in Mexico and Saudi Arabia killed thousands. While climate change now affects people from the richest to the poorest on Earth, political will to address it has waned in some countries. Governments promised under the 2015 Paris Agreement to try to prevent the average global temperature rise from exceeding 1.5C above pre-industrial levels. U.S. President-elect Donald Trump, who takes office on Jan. 20, has called climate change a hoax, dismissing the global scientific consensus. During his first term in office he withdrew Washington from the Paris Agreement, and he has vowed to push greater fossil fuel production and roll back President Joe Biden's push toward alternative energy. Recent European elections have shifted political priorities towards industrial competitiveness, with some European Union governments seeking to weaken climate policies they say hurt business. Matthew Jones, a climate scientist at the University of East Anglia in Britain, said climate-linked disasters will grow more common "so long as progress on tackling the root causes of climate change remains sluggish". EU climate commissioner Wopke Hoekstra said the 1.5C breach last year showed climate action must be prioritised. "It is extremely complicated, in a very difficult geopolitical setting, but we don't have an alternative," he told Reuters. The 1.5C milestone should serve as "a rude awakening to key political actors to get their act together," said Chukwumerije Okereke, a professor of climate governance at Britain's University of Bristol. Britain's Met Office confirmed 2024's likely breach of 1.5C above pre-industrial levels, while estimating a slightly lower average temperature of 1.53C for the year. Buontempo noted that 2024 did not breach that target since it measures the longer-term average temperature, but added that rising greenhouse gas emissions put the world on track to blow past the Paris goal soon. Countries could still rapidly cut emissions to avoid temperatures from rising further to disastrous levels, he added. "It's not a done deal. We have the power to change the trajectory," Buontempo said. Concentrations in the atmosphere of carbon dioxide, the main greenhouse gas, reached a fresh high of 422 parts per million in 2024, C3S said. Zeke Hausfather, a research scientist at U.S. non-profit Berkeley Earth, said he expected 2025 to be among the hottest years on record, but likely not top the rankings. He noted that temperatures in early 2024 got an extra boost from El Niño, a warming weather pattern now trending toward its cooler La Nina counterpart. "It's still going to be in the top three warmest years," he said. Sign up here. https://www.reuters.com/business/environment/2024-was-first-year-above-15c-global-warming-scientists-say-2025-01-10/
2025-01-10 20:24
GEORGETOWN, Guyana, Jan 10 (Reuters) - Guyana's government on Friday signed a $526 million loan agreement with the U.S. Export-Import Bank (EXIM) to finance an energy project aimed at doubling the South American nation's power generation capacity and cutting oil imports. Guyana is trying to take advantage of its vast offshore natural gas reserves and increasing production to secure enough power generation capacity for its fast-paced economic growth. The project includes a gas separation plant, a 300-megawatt power plant, and a pipeline. The initiative is expected to reduce carbon emissions in the country by over 460,000 tonnes per year, according to the EXIM. The agreement was signed in Georgetown by the bank's president, Reta Jo Lewis, and Guyana's finance minister Ashni Singh. "This project will double the country's installed electrical capacity, providing cleaner, more reliable and more affordable energy for families and businesses," Lewis said. The loan will support firms Lindsayca and CH4 Systems, which are in charge of building the project, with U.S. major ExxonMobil (XOM.N) , opens new tab providing services. Local environmental groups criticized the move, saying it contradicts U.S. President Joe Biden's commitments to phase out support for fossil fuels under international agreements. Sign up here. https://www.reuters.com/business/energy/guyana-signs-526-million-loan-with-us-exim-bank-energy-project-2025-01-10/
2025-01-10 20:05
Canadian dollar weakens 0.2% against the greenback For the week, the loonie gains 0.2% Price of U.S. oil settles 3.6% higher 10-year yield touches a seven-week high TORONTO, Jan 10 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Friday as the greenback notched broad-based gains, but the loonie still notched a modest weekly advance as domestic jobs data cooled bets on a Bank of Canada rate cut this month. The loonie was trading 0.2% lower at 1.4425 to the U.S. dollar, or 69.32 U.S. cents, after moving in a range of 1.4376 to 1.4442. For the week, the currency was up 0.2%, after six straight weekly declines. It touched a near five-year low of 1.4467 on Dec. 19. "It's not Canada's fault," said Marc Chandler, chief market strategist at Bannockburn Global Forex LLC. "I'd say the real theme is U.S. exceptionalism, or U.S. outperformance." The U.S. dollar (.DXY) , opens new tab rallied across the board after data showed the American economy created more jobs than expected last month, reinforcing expectations the Federal Reserve will pause its rate-cutting cycle. Market participants are trying to determine whether the sideways pattern for USD-CAD since mid-December is a sign of a top or the base from which the pair takes another leg higher, Chandler said, adding "I think we're going to get another leg up." Canada's economy added 90,900 jobs in December, eclipsing forecasts for a 25,000 increase. Investors see a roughly 60% chance of a BoC interest rate cut at a policy decision on Jan. 29, down from 71% before the data. For the full year, the amount of expected easing was slashed to 46 basis points from 61 basis points. The price of oil, one of Canada's major exports, settled 3.6% higher to $76.57 a barrel after the Biden administration imposed fresh sanctions targeting Russian energy revenue. The Canadian 10-year bond yield rose 9.6 basis points to 3.445%, after earlier touching its highest level since Nov. 22 at 3.461%. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-snaps-weekly-losing-streak-after-jobs-gain-2025-01-10/
2025-01-10 20:03
SAO PAULO, Jan 10 (Reuters) - The Brazilian Supreme Court is ready to rule on a request challenging a state law that ends tax breaks for grain traders banning soy purchases from deforested areas of the Amazon rainforest after a cut-off date. The legislation was passed by the country's top soy-producing state Mato Grosso but was prevented by Justice Flavio Dino from going into effect on Jan. 1 until a final decision is made. The top court will rule on the matter between Feb 14-21, according to a notice released on Friday. The voluntary pact among major grain traders, known as soy moratorium, bans the purchase of soy from deforested areas of the Amazon rainforest after 2008. Though it is praised by conservationists, it has been under growing pressure. On Friday, Mato Grosso farmer lobby Aprosoja-MT, which is not a party to the Supreme Court proceedings, said it would request admission as "amicus curiae" to offer information relevant for the case. In December, the farmer group asked Brazil's antitrust agency CADE to investigate soy moratorium signatories, claiming they behave as a "purchasing cartel to practice a collective boycott... against soy farmers." Soy lobby group Abiove dismissed such a claim, saying the moratorium strengthens Brazilian agriculture. Abiove said it defends the soy moratorium while "striving to balance the demands of both farmers and consumers, including updates to the current model to ensure its effectiveness." However, it conceded state lawmakers have pushed legislation "that significantly harm the signatories of the Soy Moratorium." Under Brazil's forestry rules, Amazon landowners can clear up to 20% of their property. But while some farmers are still eligible to suppress vegetation, they feel constrained by the moratorium. Last month, it emerged grain traders could loosen the moratorium by distinguishing between individual soy fields, letting growers sell to exporters from one part of a farm while planting soy on newly deforested areas nearby. Sign up here. https://www.reuters.com/markets/commodities/brazils-soy-moratorium-faces-test-supreme-court-ruling-looms-2025-01-10/
2025-01-10 19:08
NEW YORK, Jan 10 (Reuters) - The U.S. is expected to release by next week a climate model for clean fuel tax credits that will sharply reduce the ability of ethanol producers to access subsidies for production of sustainable aviation fuel, three sources familiar with the matter told Reuters. The exclusion of climate-smart agricultural practices, which the biofuel industry were hoping to rely on, represents a reversal from the last update of the climate model. U.S. Treasury is expected to issue a notice for proposed rulemaking on the broader program, known as 45Z, later on Friday, leaving further decisions on the plan to President-elect Donald Trump's administration. The updated climate model would also limit the pathways for credits for used cooking oil imports, two of the sources said. Both used cooking oil and ethanol can be used in production of SAF, which is made from non-petroleum feedstocks and has a smaller carbon footprint than traditional jet fuel. President Joe Biden has planned to generate 3 billion gallons in production of sustainable SAF by 2030. Air travel contributes around 2.5% of global greenhouse gas emissions, making it a big target in the fight against climate change. The Biden administration previously updated the climate model, called the GREET model, last year for a stopgap tax credit under the clean fuel program that expired on Jan 1. The new update will likely anger ethanol producers who want access to the credits, as SAF production can be lucrative for companies that have access to subsidies but is expensive to make without credits. Climate-friendly farming practices include not tilling the soil, planting cover crops and using higher-efficiency fertilizers. As the Biden administration is leaving further decisions to Trump's administration, industry investment plans will likely be delayed as well. CBOT soyoil futures traded up more than 6% on Friday after Reuters reported on the recent developments around the short-term tax credit guidance and climate model. "Whatever he (Biden) has in mind, I think we are factoring it in today," said Jack Scoville, vice president at the Price Futures Group. Sign up here. https://www.reuters.com/sustainability/climate-energy/biden-administration-release-clean-fuel-tax-credit-model-that-limits-ethanol-2025-01-10/
