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Shipping Tries to Tackle Emissions // US to Remain LNG Top Dog // EPA Kicks Can on Ozone Rules

Welcome to Grid Brief! Here’s what we’re looking at today: the shipping industry is trying to tackle net zero challenges, the US is likely to remain the world’s top LNG exporter, the EPA kicks the can down the road on new ozone restrictions, and more.

Shipping Tries to Tackle Emissions

As the shipping sector tries to cut its emissions to net zero by 2050, several strategies emerge.

Cargill, the world’s largest agricultural shipper, moves 225 million tons of cargo around the globe every year on hundreds of gargantuan vessels. The company now has a ship carried forth by colossal sails.

“The Pyxis Ocean, an 80,000-ton bulk carrier chartered by commodity giant Cargill Inc., just finished her maiden voyage from Shanghai to Singapore after the installation of two massive steel and composite-glass ‘sails.’ It’s the first ship to be retrofitted with two WindWings, each 37.5 meters (123 feet) high,” reports Bloomberg. “They can cut the vessel’s fuel use by roughly a fifth, designer BAR Technologies says. If the trial goes well, Cargill hopes to add sails to as many as 10 more vessels.”

Others are looking at different fuel types. Maersk, which has its own net zero by 2040 goal, is pursuing renewable methanol-powered vessels.

“The first green methanol-fuelled container ship, owned by A.P. Moller-Maersk, sailed from South Korea in July. The number of such vessels is expected to exceed 200 by 2028, up from 30 this year, consultancy DNV forecasts,” reports Reuters. “Maersk said methanol-powered ships with dual-fuel options cost about 10%-12% more than conventional ships, but the price difference should become insignificant in the longer run once developers achieve economies of scale.”

Several other shipping companies are setting even more aggressive emissions reduction targets. Three shipowners—Hong Kong-based tanker and bulker firm Wah Kwong, Veer Voyage, a Bahamas-headquartered containerline and OSV operator North Star Shipping—are aiming for absolute zero emissions by 2043, according to Splash.

The three companies will present their ambitions at an international shipping conference next month.

US to Remain LNG Top Dog

America looks to remain the world’s most dominant LNG provider over the next four years in terms of additional capacity, which accounts for 60% of new capacity in North America.

“This is according to GlobalData, which forecast recently that North America will in 2027 have some 284.1 million tons of annual LNG liquefaction capacity. The United States will account for close to 76% of that total,” reports Oilprice.com. “Global liquefaction capacity, meanwhile, is seen swelling from 487.3 million tons annually now to 958 million tons annually.”

Greater growth in LNG capacity will be music to the ears of poorer countries, which have been priced out of the LNG market by Europe since the outbreak of the Ukraine war. According to Oilprice, a global shift from coal to gas should also spur enduring demand for LNG capacity.

Second to America in LNG capacity is Russia, which is boosting its total by 67.5 million tons per year. Third is Qatar with 48 million tons annually.

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EPA Kicks Can on Ozone Rules

The Environmental Protection Agency has decided to take another look at a critical determination regarding ground-level ozone standards, upending the chance of immediate measures to beef up restrictions on the pollutant.

“Like a similar move by then-President Barack Obama in 2011, the delay could allow EPA to avoid a politically difficult decision until after next year’s presidential election,” reports E&E News.

EPA Administrator Michael Regans explained in a letter that the panel’s assessment has noticed several issues “that warrant additional evaluation and review” to the National Ambient Air Quality Standards for ozone.

“I have instructed my staff to immediately announce a new review of the ozone NAAQS, as well as the underlying air-quality criteria,” Regan wrote, “and to complete this review as expeditiously as possible, while also upholding the scientific integrity and rigor of the NAAQS review process and providing opportunities for public input and engagement.”

Environmentalists and public health advocates pushing for stricter standards weren’t happy with Regan’s decision, as they’ve been arguing for a reconsideration of the Trump era’s laxer ozone limits.

Conversation Starters

  • Hawaii Electric, whose negligence cost over a hundred lives in the Maui wildfires, considers filing for bankruptcy. “Hawaiian Electric is seeking advice about possibly restructuring in bankruptcy in the wake of devastating wildfires on Maui as part of ‘prudent scenario planning,’ the utility and its parent company Hawaiian Electric Industries said on Friday in a U.S. Securities and Exchange Commission filing,” reports Utility Dive. “Whether Maui Electric, a Hawaiian Electric subsidiary that serves Maui, is financially ring-fenced from its parent is ‘a complex legal question that will take time to work through,’ the utility and HEI, a holding company, said.”

  • Mongolia and the US open the door to collaborating on rare earth metals. “U.S. and Mongolian officials this week discussed ‘creative ways’ to ensure the landlocked country, dependent on goodwill from its neighbors China and Russia, could get critical minerals onto the world market, a U.S. State Department official said on Friday,” reports Reuters. “Prime Minister L. Oyun-Erdene told Reuters on Wednesday after meeting U.S. Vice President Kamala Harris in Washington that Mongolia would deepen cooperation with the United States on mining rare earths and other minerals with high-tech applications.”

  • North Carolina blocks offshore wind leases. “The Bureau of Ocean Energy Management (BOEM) has recently announced that two offshore wind sites located in Eastern North Carolina will not be leased due to objections from The Department of Defense,” reports the Carolina Journal. “"Democratic Governor Roy Cooper responded by calling the decision ‘extremely disappointing.’ The sites in question are referred to as area ‘D’ and ‘F.’ Area D, situated approximately 30 miles off the coast, is in close proximity to an already leased site near Kitty Hawk, spanning 191 square miles. Area F would have been located around 50 miles offshore.”

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