2023-11-15 18:51

HOUSTON, Nov 15 (Reuters) - A U.S. court has removed an emissions permit for Sempra's (SRE.N) Port Arthur LNG export terminal in Texas, but the company said construction of the facility will continue for now. The approximately 13.5 million-metric-tons-per-annum (mtpa) Port Arthur plant has approval to export LNG to both Free Trade Agreement (FTA) and non-FTA countries, including Europe, and is part of the U.S. LNG expansion to meet growing global demand for the superchilled gas. In its decision, the U.S. Court of Appeals for the Fifth Circuit on Tuesday found that the Texas Commission on Environmental Quality (TCEQ) failed to impose the same emissions limits on the Port Arthur plant as on other projects, including the Rio Grande LNG project which is now under construction. In a statement on Wednesday, Sempra said construction is continuing on the project under existing permits and it remains committed to working with the TCEQ. "We will continue to actively evaluate options to mitigate any potential impacts of the decision on project schedule and cost", said Sempra. "The Commission is not forever bound to the emissions limits that it set for Rio Grande LNG for all subsequent permits ... But in making those individualized determinations, the Commission must demonstrate that it is treating permit applications consistently" the court held. The decision sends the Port Arthur LNG permit application back to the TCEQ for new evaluation. "We are committed to meeting or exceeding the expectations of our regulators and other stakeholders and will continue to work with TCEQ and are confident that the agency will act quickly and appropriately to resolve this matter", said Sempra. Sempra Infrastructure retains a 28% indirect stake in the plant's Phase 1, while oil and gas company ConocoPhillips (COP.N) owns 30%. Investment firm KKR (KKR.N) owns a 20% stake in Sempra Infrastructure while Sempra Energy owns 70% and Abu Dhabi Investment Authority owns 10%. John Beard, executive director of the Port Arthur Community Action Network, which brought the lawsuit challenging TCEQ, said of the ruling: “We’ve won by standing up for Port Arthur communities of color to breathe free from toxic pollution. When attacked, we fight back – and win!” The court's decision is in keeping with increased pressure being placed on regulators and the Biden administration to limit the expansion of LNG projects in the US, said Alex Munton, director of Global Gas & LNG Research at Rapidan Energy Group. "This creates additional risk, that are already high due to the difficulties the industry faces from building several large scale projects at the same time," Munton said. https://www.reuters.com/business/energy/us-appeals-court-decision-scraps-sempras-port-arthur-lng-emissions-permit-2023-11-15/

2023-11-15 18:47

Nov 15 (Reuters) - San Francisco Federal Reserve President Mary Daly warned against calling time on rate-rising cycle too soon, in an interview to Financial Times on Wednesday. Daly refused to rule out another interest rate increase, given uncertainty about whether the central bank has done enough to push consumer price growth back down to its 2 per cent target. She indicated little concern about the recent sharp fall in US government bond yields, which has loosened financial conditions, according to FT. https://www.reuters.com/markets/rates-bonds/fed-president-daly-warns-against-calling-time-rate-rising-cycle-too-soon-ft-2023-11-15/

2023-11-15 17:05

NEW YORK, Nov 15 (Reuters) - U.S. developers building renewable energy projects and power storage for grids are scrambling to procure critical components, leading to rising costs and project delays. Supply chain problems have tightened supply of high-voltage transformers necessary to connect wind and solar farms and batteries to the grid, projects that are key to the energy transition. The long lead-time for delivery of the transformers, which can be the size of a large truck and need to be custom built, has forced some project developers to order equipment before commercial agreements to sell power from the projects are in place, said Vanessa Witte, senior energy storage analyst at Wood Mackenzie. That and the higher prices they are paying for the equipment means developers are having to take a big bet on getting all the deals and approvals they need to make a project viable, she added. "It's incredibly risky," she said. The delivery time for transformers and other associated equipment has grown from 50 weeks a year ago to 150 weeks now, said Ben Pratt, CEO of Nova Clean Energy, a utility-scale project developer based in Chicago. "We just have to be open and honest with the off-takers about the impact of delays as we move along," Pratt said, referring to buyers of power from renewable projects. "We realistically can't hit the original commercial operation date we've been discussing." Some large developers stockpiled transformers and associated equipment before measures to accelerate the deployment of renewable energy in the government's Inflation Reduction Act (IRA) triggered another spike in demand. "It was a situation that was easily predictable... but the IRA accelerated something that was already in process," said Reagan Farr, CEO of Silicon Ranch, a solar farm developer. Silicon Ranch spent over $100 million stockpiling transformers and switchgears, Farr said. Developers that did not pre-order equipment are paying a lot more for large transformers and have a lead time for delivery of at least three years, he said. The IRA, signed into law in August 2022, provides billions in green energy tax credits to accelerate and increase the installation and deployment of renewable energy. LONGER LEAD TIMES Large-scale battery projects to store energy on grids and to smooth out the variance of wind and solar power are also seeing longer lead times. They are taking around 12 to 18 months to complete, around six months longer than they would take without the supply issues, said Andrew Waranch, chief executive of battery energy storage system developer Spearmint Energy. That has improved since the summer, when completion time reached about 100 weeks, he said. "The biggest bottleneck I face today, and most developers face today is (procuring) transformers, substation equipment ... simple, old-fashioned electrical engineering equipment," Waranch said. Developers added a record 1,510 megawatts (MW) of grid-scale battery storage in the second quarter, according to a report from Wood Mackenzie and the American Clean Power Association. That, however, was lower than anticipated because of the supply chain problems. For the full year, developers and power plant owners plan to add 9,400 MW of battery storage capacity to the existing total of 8,800 MW, according to the U.S. Energy Information Administration. The capacity is expected to nearly double again to reach 30,000 MW by 2025. Swiss-based Energy Vault, which provides equipment and other services to power producers in the U.S., has started to bake in longer timelines and higher costs for storage projects to minimize the impact of delays, said Marco Terruzzin, chief commercial and product officer. Utility AES Corp (AES.N) has stockpiled supplies of the equipment it needs to build battery storage projects through 2025, a company spokesperson said. A shortage of raw materials that has contributed to transformer supply delays is unlikely to ease soon, manufacturers said. Electrical steel supplies have been tight since the pandemic due to factory shutdowns in China, said Doug Banty, president and chief operating officer at MGM Transformer, a California-based transformer manufacturer. "This is an industry that is not accustomed to rapid production expansion ... most of us are playing catch up," Banty said. Export restrictions imposed on Russia after it invaded Ukraine exacerbated the shortages, said Banty. The supply-demand dislocation has worsened with the rapid scale-up of wind, solar and storage projects. U.S. producers have been slow to expand capacity due to the expense, John Darby, president of Niagara Transformer, a New York-based manufacturer. https://www.reuters.com/business/energy/us-renewable-grid-battery-projects-battle-transformer-shortage-2023-11-15/

2023-11-15 15:05

LONDON, Nov 15 (Reuters) - The head of the International Monetary Fund has urged countries to make a more proactive push to develop central bank digital currencies (CBDC). Eleven countries, including a number in the Caribbean, and Nigeria, have already launched CBDCs. Around 120 others are exploring them, although progress and approaches differ widely and a few have even abandoned the idea altogether. "We may be at a point where the public sector needs to offer a little more guidance," IMF Managing Director Kristalina Georgieva said in a speech in Singapore. "Not to crowd out, not to disrupt," she added. "But to act as a catalyst, to ensure safety and efficiency - and to counter fragmentation." She made her remarks as the IMF published the first instalment of a "virtual handbook" on CBDCs, designed to help countries with the design and set-up process and ensure that the new technologies are globally interoperable. Supporters say CBDCs will modernise payments with new functionality and provide an alternative to physical cash, which seems in terminal decline. But questions remain as to why they represent an advance when current systems are already capable of many of the proposed benefits, and countries such as Nigeria that have already launched CBDCs are seeing very low uptake among the public. Georgieva said that with technology advancing so rapidly, countries needed to push ahead with development now to avoid getting caught out in future. "If anything, we need to raise another sail to pick up speed," she said, likening the efforts to a nautical journey. "The world is changing faster than most imagined". https://www.reuters.com/business/finance/imf-chief-urges-more-proactive-push-central-bank-digital-currencies-2023-11-15/

2023-11-15 14:54

Nov 15 (Reuters) - Commerzbank AG (CBKG.DE) on Wednesday said it has received a crypto custody licence in Germany, which it said will allow it to launch a "broad range" of digital asset services, with a focus on crypto assets. The services will be aimed at institutional and corporate clients, and the first product will be a custody service for the cryptocurrencies bitcoin and ether, a spokesperson for Commerzbank said via email. https://www.reuters.com/technology/commerzbank-receives-crypto-custody-licence-germany-2023-11-15/

2023-11-15 13:32

BUENOS AIRES, Nov 15 (Reuters) - Argentina's central bank allowed the peso to weaken slightly on Wednesday to 353 per dollar, traders said, reactivating its 'crawling peg' for the currency that has been frozen at 350 per dollar since a primary election in mid-August. The currency, devalued sharply after the Aug. 13 primary, opened down 1.4% at 355 per dollar, though quickly adjusted slightly to 353, traders said. The embattled currency has been shackled by varying degrees of capital controls since 2019. The Secretary of Economic Policy, Gabriel Rubinstein, had said last month on social network X, previously Twitter, that from Nov. 15 the peso would be put back on a crawling peg, ultimately allowing it to devalue by around 3% monthly. Argentines will go to the polls on Sunday to elect a new president between Peronist Economy Minister Sergio Massa and ultra-liberal outsider Javier Milei, who has proposed dollarizing the economy and shutting the central bank. https://www.reuters.com/markets/currencies/argentina-restarts-crawling-peg-let-currency-weaken-first-time-since-august-2023-11-15/