Plus: LNG trucks in China; Offshore wind out of favour; AI data centers hungry for power; Big battery in Philippines; Lithium-sulfur EV batteries
Hi everyone,
Here we are near the end of 2024 with my final newsletter of this year. Thank you for sticking with me and I hope you have found my posts differential and informative. Please continue to forward this on to others and encourage them to subscribe.
*|FNAME|*, I wish you and your family the very best for this Christmas season and a prosperous 2025.
Sincerely,
Peter
Peter’s take: North American Urbanism and China
The end of a year is a good time to pause and reflect. I’ve written a lot recently on many urbanism topics. Some of you might be thinking: what’s the deal, Peter – how does this matter to the global energy system? The overarching point is that if we are to solve for climate change in places like the US, Canada and Australia, we must look at reducing end use emissions, which means – yes – reducing demand for oil and gas. Solving for end use emissions necessarily means looking at energy use in cities. And of course, the energy-related emissions in places like China and India matter for addressing climate change, but I believe it is important to also consider energy-related emissions wherever we find ourselves – and for many of you reading this, that means looking at your city.
We need to get better at changing how we design and build cities to be more energy efficient – whether that is building codes, zoning reform to allow densification, mode shifting transportation from cars to bikes and mass transit, etc., etc. Even building streets with narrower lanes to deliberately slow cars down to make it safer for pedestrians and cyclists. Which also means reconsidering the design of fire trucks (often the ones wanting wide lanes). All these measures are smart economic policy for cities too.
Without relying on densification, growth is forced outwards to new far-flung suburbs. Such an approach burdens cities with the extra cost to build out more car-dependent infrastructure and then maintain and service that infrastructure. Very, very costly. Conversely, gentle densification costs cities nothing as developments rely on existing infrastructure. Plus, the resulting higher property values means considerably higher property tax revenue. And that isn’t even counting any multiplier effects such as provoking new businesses to serve denser existing neighbourhoods or promoting healthier lifestyles. Lastly, these approaches should be thought of as sound municipal economic development policy as it has been proven that cities that are more bikeable, walkable and with good transit are attractive to prospective new employers. And all of these approaches lead to less energy-related emissions.
But now let’s have a look at China. I created the graph below from one prepared by the International Energy Agency (IEA). I had to alter it to keep the scales consistent, so we could truly see the magnitude of what China has been up to in the last two years, relative to the rest of the world. And sure, the cumulative investment in clean energy is not yet at the level recommended, though it is worth reflecting on just how much progress is being made.
Source: Modified from IEA 2024; Renewables 2024, License: CC BY 4.0
And that is not the only remarkable thing happening in China….
China’s LNG truck fleet has almost tripled since 2019, with their number expected to reach over 1 million in 2025.
Credit: FT
Over January-May, sales of LNG-fueled heavy-duty trucks rose 127% year on year to 92,562 units. And from January to August, natural gas trucks represented a staggering 42% of all heavy-duty truck sales in China. Presently, natural gas is 23% cheaper than diesel. This lower cost in fuel helps owners quickly recoup the higher cost of LNG trucks. The net result: the growth of LNG-fueled trucks is slowing overall oil demand growth in the world’s top crude oil importer. Not surprisingly, India has draft plans to use LNG for a third of its fleet within 5-7 years.
Finance & Sentiment
Goldman Sachs Exits Net Zero Banking Alliance
Chalk this up to a strategic recalibration by the bank as it reassesses ESG commitments. Plus, some likely pressure from US Republican politicians.
Insurers’ Climate Losses Almost Match Fossil-Fuel Premiums
Asset owners with $9.5trn urge mandatory Scope 3 emissions disclosures
The Net-Zero Asset Owner Alliance (NZOA) says investors don’t have quality information to be able to compare companies. Even though Scope 3 reporting is rife with double counting, they want it anyways.
Technology
Hydrogen
Remarkable that I found no headlines worth sharing, a signpost in itself.
Carbon Capture & Removal
Direct Air Capture Provider Heirloom Raises $150 Million to Scale Carbon Removal Technology
Heirloom’s carbon removal customers include Microsoft, JP Morgan, McKinsey, Stripe, and Shopify.
Google Signs Carbon Removal Deal to Capture CO2 in Crushed Rocks and Soil
The Grid
Australian Grid Wants Ability to Tame a World-Beating Solar Boom
Imagine that: with solar panels on one in three households – the most of any jurisdiction globally, demand for power is so low at times that the grid operator needs the ability to remotely switch off home systems.
Free Green Power in Sweden Is Crippling Its Wind Industry
Sweden’s wind industry is somewhat a victim of its own success. Electricity prices are predicted to be near zero for the next couple of years, making it difficult to attract new investment. Plus, the country is making it harder to get approvals. Growing demand could be met with nuclear, given the government subsidies. Makes for an interesting jurisdiction to keep an eye on.
Denmark gets no bids in largest-ever offshore wind tender
Likewise with Sweden, low electricity prices and higher costs are combining to stifle investment. Plus, there were no subsidies on offer. Assuming nothing changes, proportion of green power on the grid may go down, as other non-renewable sources meet growing demand.
BP and Shell cut offshore wind spending; focus on oil & gas
In keeping with the themes of the preceding stories, we are seeing a notable shift away from offshore wind developments. Frankly, they simply don’t compete for investment, given the higher costs, NIMBY opposition, elusive grid connections and high interest rates all combine to represent higher risk and lower and uncertain returns.
Google plans to build gigawatts of clean power and data centers together
With grid connections hard to come by, co-locating data centers to generation is an obvious choice. Batteries are regularly paired with renewables to meet peak consumer demand for 2-4 hours in the evening. But using batteries to back up renewables for the 24/7 power needed by data centers hasn’t been done before, as far as I know.
US Midwest grid signs off on record $21B transmission ‘backbone’
Nuclear
Meta Turns to Nuclear Energy to Decarbonize AI Buildout
Big Tech is the nuclear industry’s new best friend: Amazon, Microsoft and Google rush to sign deals
Energy Storage
Hawthorne permitting 300MW PV co-located with a 300MW/1,200MWh battery in Grant County, Washington
TagEnergy and Tesla launching construction on France’s largest BESS at 480MWh
Trina Solar lodges planning application for 1GWh BESS in Victoria, Australia
Macquarie-Shell Energy completes 200MW/400MWh battery in Victoria, Australia
Huawei to provide 4.5GWh BESS for Philippines Terra Solar project
Lithium-ion battery pack prices fall 20% in 2024 amidst ‘fight for market share’
Solar and Wind
Australia announces 6.4 GW of renewable energy projects under national tender
Japan’s Jera, UK’s BP to invest $5.8B in new offshore wind power JV
South Australia has the most wind and solar and no baseload: So why is it the only state not fretting about a vulnerable grid?
At 72%, the proportion of renewable generation is impressive. It is why I am watching this jurisdiction closely. Interesting to hear how they are making it work: gas peakers and “four synchronous condensers – spinning machines that do not burn fuel”.
11 Boston-area institutions partner on renewable energy virtual power purchase agreements
New York finalizes contracts with 23 renewables projects totaling 2.3 GW
That’s enough for 700,000 homes.
TotalEnergies Acquires Renewable Energy Developer VSB for $1.7 Billion
Meta signs quartet of solar purchase agreements with Invenergy totaling 760MW
Transportation
EV batteries may last up to 40% longer than expected – Stanford
One interesting tidbit: “short, sharp accelerations in EVs actually slow down battery degradation. That flips the script on what researchers – including this study’s own team – had assumed for years: that acceleration spikes were a battery’s worst enemy.”
Jeep, Dodge maker developing lithium-sulfur EV batteries promising to cut costs in half
If the halving in costs can be achieved, we’d next need to see how the batteries perform.
EVs/hybrids reach 25% of new car sales in Britain
A 1.2GW solar project in Oregon gets approval; comes with 1.2GW battery
Policy
Canada sets new 45–50% emissions reduction goal for 2035
All the targets set by Canada going back decades have never been met. Add this one to the heap.
EU Commission Commits €4.6 Billion to Support Cleantech Projects