2024-03-21 21:00

WASHINGTON, March 21 (Reuters) - The Biden administration says its recent decision to scale back new climate regulations meant to force emissions cuts from cars and power plants will have a negligible impact on its overarching goal to halve greenhouse gas pollution this decade. But whether that is true hinges on whether the U.S. succeeds in its parallel strategy - to use lucrative taxpayer subsidies to fuel a massive deployment of solar, wind and other renewable energy installations that Biden hopes will ultimately power America’s fleet of electric vehicles, along with its homes and businesses, according to researchers. "I think it will require an extraordinary, coordinated effort to meet the clean energy share that is necessary to hit the (U.S. target)," said Mike O'Boyle, senior director for electricity at research firm Energy Innovation. The United States is the world’s biggest historical emitter of carbon dioxide and President Joe Biden has promised the international community that it will push hard to decarbonize as part of global efforts to fight climate change, using a combination of regulation and subsidies. But the recent decisions by his administration to ease auto emissions standards and to remove existing natural gas-fired power plants from CO2 curbs show how Biden’s administration is under industry pressure over the plans ahead of the November election. The transport and power sectors together account for half of the country’s greenhouse gas emissions, but the perception of heavy-handed regulation of those industries risks hurting Biden's reelection bid against rival and former President Donald Trump. Climate researchers told Reuters they agree with official projections from the Environmental Protection Agency (EPA) that the changes to the rules may not have much impact on the U.S. goal to halve national emissions by 2030 from 2005 levels. Amanda Levin, director of policy analysis at the Natural Resources Defense Council, said the weakening of the EPA vehicle rule, for example, would still achieve at least 90% of the emissions reductions of the more stringent initial proposal, while the removal of existing gas plants from the EPA power plant rule would deliver 80% of the initial proposal. More important to the US decarbonization target, however, is how fast developers can build zero-emissions power generation and hook it up to the grid - efforts crucial to supporting the EV fleet and which would render the power plant regulation moot. Biden is attempting to spur those industries along by using lucrative subsidies for wind, solar and electric vehicles embedded in the roughly $400 billion Inflation Reduction Act. "The EPA rules serve more as the as a backstop (to the IRA)," said O'Boyle. Before the IRA passed in 2022, the U.S. was only on track to reduce its emissions 25%-28% by 2030, according to NRDC's Levin. Both NRDC and energy consultancy the Rhodium Group found in separate analyses that the U.S. is now on track to reduce its greenhouse gas emissions by 42% by 2030. Still, filling the remaining gap could be tricky. Both the U.S. solar and offshore wind manufacturing industries are pushing the Biden administration for more support, in addition to what is included in the IRA, to ensure they have the financing and economics needed to follow through with their investment plants. O'Boyle and others said additional challenges include permitting and constructing transmission lines required to connect new power generation to consumers. Around 2,000 GW of mainly renewable generation and energy storage are in regional grid interconnection queues across the United States, with recent announced projects - many incentivized by the IRA's tax credits - taking upwards of five years to connect. The Federal Energy Regulatory Commission and the Energy Department are working on reforms aimed at speeding up the interconnection backlog and expanding transmission. Levin of the NRDC said states can also help fill the gap with strengthened renewable energy targets and EV policies, especially as IRA-driven investments hit the ground from California to Texas to Pennsylvania. "That is a huge piece of the puzzle," she said. Get weekly news and analysis on the U.S. elections and how it matters to the world with the newsletter On the Campaign Trail. Sign up here. https://www.reuters.com/world/us/bidens-softer-climate-regulation-shows-big-us-bet-subsidies-decarbonize-2024-03-21/

2024-03-21 20:56

NEW YORK, March 21 (Reuters) - Crypto exchange FTX said it expects to negotiate U.S. government claims in its bankruptcy down to $3 billion to $5 billion, leaving no money for shareholders and contradicting a "reckless and false" claim by founder Sam Bankman-Fried that FTX's collapse caused no harm. FTX revealed those estimates in court documents on Wednesday in response to founder Sam Bankman-Fried's claims that he should receive a light prison sentence because FTX will be able to repay its customers "in full". Bankman-Fried was convicted in November of stealing $8 billion from FTX customers. FTX's current CEO John Ray said in court filings in Delaware bankruptcy court that Bankman-Fried had distorted the company's recent statements about its ability to repay customers in bankruptcy to argue that there was "zero" harm to FTX customers, lenders and investors. "All of these statements are both reckless and false," Ray wrote. "Even the best conceivable outcome in the Chapter 11 proceeding will not yield a true, full economic recovery by all creditors and non-insider equity investors as if the fraud never happened," he said. FTX estimates that it will have $13.7 billion in assets to pay $31.4 billion in legitimate claims, including $9.2 billion in customer claims and $17 billion in claims asserted by the U.S. Commodity Futures Trading Commission and the Internal Revenue Service. FTX said in January that it expects to pay customers "in full," but that statement came with a major caveat: It will value customer claims based on the price of crypto in November 2022, and customers will receive no benefit from a significant rise in crypto prices since that date. Many FTX customers are "extremely unhappy" with FTX’s proposed repayment, Ray wrote. FTX proposed bankruptcy repayment still faces significant obstacles, including ongoing negotiations over the $17 billion in claims asserted by the U.S. government. FTX is working towards a settlement that would allow FTX to repay its customers before the government and reduce the total government claims to between $3 billion and $5 billion. The U.S. government has agreed to prioritize customer repayment in recent crypto bankruptcies, including the BlockFi and Genesis Global cases. If the government does not agree to prioritize FTX customers, its claims could significantly dilute the amount available to repay customers, FTX said. One group that will definitely be harmed by Bankman-Fried’s fraud are FTX investors and shareholders, who have little hope of recovering any money from the company's bankruptcy, according to FTX. FTX will not have enough money to pay shareholders, who are last in line for repayment after the company’s customers, its lenders and the U.S. government. The Technology Roundup newsletter brings the latest news and trends straight to your inbox. Sign up here. https://www.reuters.com/technology/ftx-expects-us-reduce-bankruptcy-claim-3-billion-5-billion-2024-03-21/

2024-03-21 20:44

March 21 (Reuters) - Offshore wind energy development presents an opportunity to add transmission capacity to the U.S. East Coast's power system that could ensure reliability for electric grid, according a study released by the U.S. Department of Energy (DOE) on Thursday. "This would allow offshore wind transmission to provide energy to areas of high demand and reduce grid congestion, increase system reliability, lower curtailment, and flow power from lower-price regions to higher price regions, reducing costs for consumers," DOE said in the release citing the Atlantic Offshore Wind Transmission Study , opens new tab. The study noted that after 2030, strategically linking wind energy projects via offshore transmission networks will help lower electricity production costs and reduce dependence on fossil fuels. Offshore wind energy is projected to be a key part of achieving a low-carbon future for Atlantic states and offshore transmission networks contribute to grid reliability by enabling resource adequacy and helping manage the unexpected loss of grid components, the DOE added in the release. "Offshore wind energy is already powering more than one hundred thousand homes along the east coast, with the potential to grow and further enhance grid reliability and reduce even more fossil fuels," said U.S. Secretary of Energy Jennifer M. Granholm. The findings from the study support the government's goal of reaching 30 gigawatts of offshore wind energy by 2030 and unlocking a pathway to 110 GW or more by 2050. Last year, U.S. President Joe Biden’s goal to deploy 30,000 megawatts of offshore wind along U.S. coastlines this decade was seen unattainable due to soaring costs and supply chain delays, according to forecasters and industry insiders. DOE had said earlier that U.S. needs to more than double the capacity of power grid to realize President Joe Biden's climate goals, including reaching 100% clean electricity by 2035. Get weekly news and analysis on the U.S. elections and how it matters to the world with the newsletter On the Campaign Trail. Sign up here. https://www.reuters.com/world/us/us-offshore-wind-energy-development-could-ensure-east-coast-grid-reliability-2024-03-21/

2024-03-21 20:33

HOUSTON, March 21 (Reuters) - The government of Trinidad and Tobago has begun talks with the U.S. for a license that would allow the joint development of a natural gas project shared with Venezuela that also involves BP (BP.L) , opens new tab, Energy Minister Stuart Young said on Thursday. The Manakin-Cocuina areas are part of the Plataforma Deltana massive gas project on the Venezuela side of the maritime border, which remains idled. On Trinidad's side, BP operates the field, and is moving toward a financial decision to develop it in keeping with U.S. sanctions against Venezuela. Venezuela's government and BP last week confirmed talks to revive the joint development of Manakin-Cocuina, which had remained suspended for years upon imposition of U.S. sanctions in 2019. Venezuela said it was considering granting a separate long-term license for the project. Trinidad has been pressing producers in recent years, especially offshore, to speed up gas projects so that the production of liquefied natural gas (LNG) recovers, boosting exports and petrochemical production. Minister Stuart Young said he hopes Washington will grant the license for Manakin-Cocuina this year, similar to a 2023 authorization it extended to the Dragon gas project in Venezuela, which is being planned by Shell (SHEL.L) , opens new tab and Trinidad's National Gas Company (NGC). "The government of Trinidad and Tobago is dealing with the government of Venezuela, and bringing BP along, as we did with Shell. So there is a precedent, a template for getting it done. And we have seen very, very fast progress and very productive progress," he told Reuters on the sidelines of the CERAWeek conference in Houston. BP declined to comment on government to government matters. The U.S. license for Dragon is set to expire in October next year, so talks for a possible extension are already taking place, Young said. Shell and NGC have started preparations for Dragon's pre-FEED (Front-End Engineering and Design), a pivotal stage to ensures economical feasibility. Trinidad's government expects Shell will be ready to make a final investment decision on that project next year, Young said. The Reuters Power Up newsletter provides everything you need to know about the global energy industry. Sign up here. https://www.reuters.com/business/energy/ceraweek-trinidad-talks-with-us-bp-gas-project-shared-with-venezuela-min-2024-03-21/

2024-03-21 20:13

CHICAGO, March 21 (Reuters) - As Iowa heads toward its fourth year of drought, grain farmers prepping for planting next month are facing mandatory water restrictions and livestock producers are searching for supplies. The nation's top corn-producing state is seeing one of its driest periods going into a growing season, according to Thursday's update from U.S. Drought Monitor. Such dry conditions will allow farmers to plant quickly this season, a bearish move for grain futures that have already been trending downward this year. The U.S. last year harvested a record corn crop despite drought conditions in some areas, and corn prices have hovered around the lowest in more than three years due to plentiful global supply. Iowa had enough sub-soil moisture that farmers were able to produce a bountiful yield last fall with timely rains, said Don Roose, president of Iowa-based U.S. Commodities. "This year, we're running on empty, moisture-wise," Roose said. About 23% of Iowa's corn acres and 19% of its soybean acres are in an extreme drought, according to Gro Intelligence, a New York-based data and analytics firm that analyzed Thursday's drought update and U.S. Department of Agriculture data for Reuters. In comparison, less than 2% of the state's corn and soybean acres were in an extreme drought during the same time a year earlier, Gro Intelligence found. Though forecasts for spring rains could temporarily improve Iowa's situation, weather models predict that drought conditions in northern and eastern parts of the state will intensify going into the summer, said Brad Pugh at the National Weather Service's (NWS) Climate Prediction Center. Drought concerns prompted Iowa's Poweshiek Water Association to issue a mandatory water conservation order this month to customers in eight counties and surrounding areas. Among other things, it warned that, starting April 1, crop farmers wanting to spray diluted chemicals or other inputs on their fields may need to source water from private wells or outside the service area. That order will impact Cordt Holub. Last year, his cattle were able to drink at a nearby stream - until it ran dry. Water restrictions could mean shifting his crop farming practices later this season, which may impact yields. "Come summertime, if the water isn't there, we're going to have to skip on a fungicide pass, maybe an insecticide pass," Holub said. "We need water to farm." NWS scientists also are tracking how a potential shift to a La Nina weather pattern this summer may impact interior river levels this fall - when U.S. grain harvests hit the global markets. Get weekly news and analysis on the U.S. elections and how it matters to the world with the newsletter On the Campaign Trail. Sign up here. https://www.reuters.com/world/us/iowas-drought-conditions-have-farmers-budgeting-water-use-2024-03-21/

2024-03-21 20:00

MEXICO CITY, March 21 (Reuters) - The Bank of Mexico, as expected, cut its benchmark interest rate by 25 basis points to 11.00% on Thursday, in a four-to-one decision by its governing board, marking the first rate reduction since the bank embarked on a tightening cycle in 2021. Banxico, as the Mexican central bank is known, said it will thoroughly monitor inflationary pressures and that at its next monetary policy meetings, "it will make its decisions depending on available information." Voting in favor of the rate cut were Banxico governor Victoria Rodriguez and deputy governors Galia Borja, Jonathan Heath, and Omar Mejia. Deputy governor Irene Espinosa voted to hold the rate at 11.25%. Analysts polled by Reuters had overwhelmingly predicted the board would cut the rate by 25 basis points after holding it steady for seven straight policy meetings. "In our opinion, the 4-1 vote significantly reduces the probability of a rate pause in May," said analyst Luis Adrian Muniz at Vector Analisis. "In this sense, continuous cuts seem most likely, at least during the next two quarters." Banxico said that headline inflation is still forecast to converge to its target of 3%, plus or minus a percentage point, in the second quarter of 2025. Its forecast for year-end headline inflation was revised upwards to 3.6%, from 3.5% previously. Goldman Sachs analyst Alberto Ramos in a note to clients that Banxico's "inflation forecasts for end-2024 are still too optimistic." Mexico's rate cut contrasts with the stance of the U.S. Federal Reserve, which on Wednesday left interest rates unchanged, though Fed Chair Jerome Powell underscored that recent high inflation readings had not changed the underlying "story" of slowly easing price pressures in the U.S. as the central bank stayed on track for three interest rate cuts this year. In Latin American regional powerhouse Brazil, the central bank on Wednesday cut its benchmark interest rate by 50 basis points at a sixth straight policy meeting, while flagging it may change the course of the current easing cycle after its next decision in May. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/world/americas/bank-mexico-cuts-key-interest-rate-25-basis-points-11-2024-03-21/