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As Maine considers building a new toll highway to improve commutes in and out of Portland, a state climate working group is drafting strategies to reduce driving in the state.
State officials say the two efforts are not inherently at odds, but experts and advocates caution that continued highway expansion could reverse climate progress by encouraging more people to drive.
The parallel discussions in Maine raise a question that few states have yet grappled with: can governments keep expanding car infrastructure without putting climate goals out of reach?
Transportation is the largest source of greenhouse gas emissions in Maine and many other states. Electric vehicle adoption is growing, but not fast enough to solve the problem on its own, which is why an updated state climate plan is expected to include a new emphasis on public transit, walking, biking, and other alternatives to passenger vehicles.
Zak Accuardi, the director for mobility choices at the Natural Resources Defense Council, said the best way for states to invest in their road systems in the era of climate change is to not build new roads, but maintain and upgrade existing ones to accommodate more climate-friendly uses.
“The states who are taking transportation decarbonization really seriously are really focused on reducing driving, reducing traffic,” Accuardi said, pointing to Minnesota and Colorado as examples. “Strategies that help support more people in making the choice to walk, bike or take transit — those policies are a really important complement to … accelerating the adoption of zero-emissions vehicles.”
Electric vehicles have been Maine’s primary focus to date in planning to cut back on transportation emissions. Goals in the state’s original 2020 climate plan included getting 41,000 light-duty EVs on the road in Maine by next year and 219,000 by 2030. The state is far behind on these targets. The climate council’s latest status report said there were just over 12,300 EVs or plug-in hybrid vehicles in Maine as of 2023.
A 2021 state clean transportation roadmap for these goals recommended, among other things, the adoption of California’s Advanced Clean Cars II and Advanced Clean Trucks rules, which would require an increasing proportion of EV sales in the coming years.
Maine regulators decided not to adopt Clean Cars II earlier this year in a 4-2 vote. A subsequent lawsuit from youth climate activists argued the state is reneging on its responsibility to meet its statutory climate goals by choosing not to adopt such rules.
The original climate plan also aimed to cut Maine’s vehicle miles traveled (VMT), which measures how much people are driving overall, by 20% by 2030. The plan said getting there would require more transit funding, denser development to improve transit access, and broadband growth to enable remote work, but included little detail on these issues. It did not include the words “active transportation” at all.
That appears poised to change in the state’s next four-year climate plan, due out in December. Recommendations from the state climate council’s transportation working group have drawn praise from advocacy groups like the Bicycle Coalition of Maine.
The group’s ideas include creating new state programs to support electric bike adoption, including in disadvantaged communities; paving 15 to 20 miles of shoulders on rural roads per year to improve safe access for cyclists and pedestrians; and, depending on federal funds, building at least 10 miles of off-road trails in priority areas by 2030.
The group also recommended the state “develop targets related to increased use of transit, active transportation, and shared commuting that are consistent with Maine’s statutory emissions reduction goals.”
In unveiling the recommendations, working group co-chair and Maine Department of Transportation chief engineer Joyce Taylor noted community benefits from road safety upgrades to accommodate these goals.
“I think this also gets at housing and land use,” she said. “If you can get people to want to live in that community, that village, I think we could all say that it’s more economically vibrant when people are able to walk and bike in their village and feel like they can get around and it’s safe.”
The Gorham Connector project would offer a new, tolled bypass around local roads as an alternative to upgrading those existing routes, an option that’s also been studied. State officials say the new road would smooth the flow of local traffic, including public transit.
Towns like Kittery, in southern Maine, have tried to focus on a more inclusive array of transportation strategies in their local work to cut emissions from passenger vehicles.
Kittery town manager Kendra Amaral is a member of the climate council’s transportation group. She couldn’t comment on the state’s approach to the Gorham Connector, which is outside her region. But she said her town’s climate action plan, adopted this past May, “threads together” public transit, housing growth and emissions reductions.
Stakeholders who worked on the plan, she said, strongly recommended ensuring that housing is in walkable or transit-accessible places.
Amaral said the town has invested in new bus routes, commuter shuttles and road improvements to promote traffic calming and create safer bike and pedestrian access, as well as in EV growth. And she said Kittery was a model for parts of a new state law that enables denser housing development.
“We can’t expect people to reduce (emissions) resulting from transportation without giving them options,” she said. But, she added, “there is no ‘one size fits all’ solution” for every community. “I believe we have to avoid the ‘all or nothing’ trap and work towards (the priorities) that get the best results for each community,” she said.
The Maine Turnpike Authority acknowledges the proposed Gorham Connector project in the Portland area would increase driving. But paired with improvements to transit and land-use patterns, they say the proposed limited-access toll road would decrease emissions overall — though research and other cases cast doubt on this possibility.
“It’s possible for a project like this to be designed in a way that does produce favorable environmental outcomes,” Accuardi said, but “the devil is really in the details.”
For example, he said the new road’s tolls should be responsive to traffic patterns in order to effectively reduce demand. If they’re too low, he said, the road will become jammed with the kind of gridlock it aimed to avert. But set the tolls too high, and the road won’t get used enough.
He said it’s true that this kind of new access road can lead to denser housing development in the surrounding area — but the road will need to be tolled carefully to account for that increased demand.
And the proceeds from those tolls, he said, should ideally go toward new clean transportation alternatives — such as funding additional transit service or safe walking and biking infrastructure around the new toll road, helping to finance subsidized affordable housing in transit-served areas, or allocating revenues to surrounding towns that make “supportive land-use changes” to lean into transit and decrease driving.
Maine has indicated that it expects to use tolls from the Gorham Connector primarily, or at least in part, to pay for the road itself and avoid passing costs to other taxpayers.
But Accuardi said alternative strategies should see more investment than road expansions in the coming years if states like Maine want to aggressively cut emissions.
He said on average, across the country, states spend a quarter of their federal transportation funding on “expanding roads or adding new highway capacity.”
“That’s more money than states tend to spend on public transit infrastructure, and that really needs to be flipped,” he said. “We need to see states really … ramping down their investments in new highway capacity. Because, again, we know it doesn’t work.”
China’s carbon dioxide (CO2) emissions fell by 1% in the second quarter of 2024 in the first quarterly fall since the country re-opened from its “zero-Covid” lockdowns in December 2022.
The new analysis for Carbon Brief, based on official figures and commercial data, shows China remains on track for a decline in annual emissions this year.
This annual outlook depends on electricity demand growth easing in the second half of the year, as expected in projections from sector group the China Electricity Council.
However, if the latest trends in energy demand and supply continue – in particular, if demand growth continues to exceed pre-Covid trends – then emissions would stay flat in 2024 overall.
Other key findings from the analysis include:
A slew of recent policy developments, summarised below, hint at a renewed focus in Beijing on the country’s energy and climate targets.
Yet the precise timing and height of China’s CO2 emissions peak, as well as the pace of subsequent reductions, remain key uncertainties for global climate action.
China’s CO2 emissions fell by 1% in the second quarter of 2024, the first quarterly fall since the country re-opened from zero-Covid, as shown in the figure below.
Within the overall total, power sector emissions fell by 3%, cement production fell by 7% and oil consumption by 3%.
The reduction in CO2 emissions was driven by the surge in clean energy additions, which is driving fossil fuel power into reverse. (See: Clean energy additions on track to top 2023 record.)
However, rapid energy demand growth in sectors such as coal-to-chemicals diluted the impact of changes in the electricity sector. (See: Rapid energy demand growth.)
The additions of new clean power capacity in China have continued to boom this year.
China added 102 gigawatts (GW) of new solar and 26GW of wind in the first half of 2024, as shown in the figure below. Solar additions were up 31% and wind additions up 12% compared with the first half of last year, so China is on track to beat last year’s record installations.
As a result of the strong capacity growth – and despite poor wind conditions – solar and wind covered 52% of electricity demand growth in the first half of 2024 and 71% since March. (The fall in wind speeds can be seen from NASA MERRA-2 data averaged for all of China.)
Indeed, the increase in power generation from solar and wind reported by the National Energy Administration in the first half of the year, at 171 terawatt hours (TWh), exceeded the UK’s total electricity supply of 160TWh in the first half of 2023.
Rapid demand growth in January–February, at 11%, had outpaced even the clean energy additions. But combined with a rebound in hydropower generation, the increase in non-fossil electricity supply exceeded power demand growth in the March to June period.
These shifts are shown in the figure below, illustrating how clean power expansion started to exceed electricity demand growth in recent months, pushing coal and gas power into reverse.
After stopping the publication of capacity utilisation data by technology in May, the National Energy Administration released data in July on power generation by technology for renewable sources – solar, wind, hydro and biomass.
The NEA’s data shows renewable electricity generation covering 35% of demand in the first half of 2024 and growing 22% year-on-year. This is much higher than the previously-published National Bureau of Statistics numbers – which under-report wind and particularly solar power generation – but is closely aligned with estimates previously published by Carbon Brief.
In terms of other clean energy technologies, the production of electric vehicles, batteries and solar cells – the so-called “new-three” due to their recently acquired economic significance – continued to grow strongly in the first half of the year, at 34%, 18% and 37%, respectively.
This growth in production indicates strong demand from China and overseas. The growth of solar cell production halted in June, however.
While clean technologies continue to surge in China, energy consumption has also continued to grow at a fast rate relative to GDP. This indicates that the energy-intensive growth pattern that China followed during zero-Covid is continuing.
In the second quarter of 2024, total energy consumption increased by 4.2%, while GDP grew by 4.7%, marking an energy intensity gain of only 0.5%. This energy demand growth is much faster than the pre-Covid trend.
China’s target is an annual improvement of 2.9%, a rate that was exceeded consistently until Covid-era economic policies shifted the country’s growth pattern. Economic growth during and after zero-Covid has been reliant on energy-intensive manufacturing industries.
The main structural drivers of recent energy consumption growth were the coal-to-chemicals industry, and industrial demand for power and gas.
The coal-to-chemicals industry produces petrochemical products from coal instead of oil, supporting China’s energy security goals but at a great cost to climate goals, as the coal-based production processes have far higher carbon footprints.
China’s energy security drive and falling coal prices relative to oil prices have driven a boom in this industry. When coal supply was tight in 2022–23, the government was controlling coal use by the chemical industry to increase supply to power plants. As the coal supply situation has eased in 2024, this has enabled coal-to-chemicals plants to increase production, with coal consumption in the chemical industry growing 21% in the first half of the year.
Gas consumption increased 8.7% in the first half of the year, with industrial and residential gas consumption rising strongly, even as power generation from gas fell. Residential demand was driven up by extreme cold in the winter, however, rather than by structural factors.
On the flipside, the demand for oil products continued to fall, with a 3% drop in the second quarter that accelerated in the summer.
There are multiple factors driving the reduction: the shift to electric vehicles is contributing to the drop, with the share of EVs in cumulative vehicle sales over the past 10 years – an indicator of the mix of vehicles on the road – reaching 11.5% in June, up from 7.7% a year ago. This means that the increase in EVs cut the demand for transport fuels by approximately 4%.
The ongoing contraction in construction volumes, which is apparent in the fall in cement production, also affects oil demand, as the construction sector is a major source of demand for oil products for freight and machinery.
Another key driver is weak demand for oil as a petrochemical feedstock, which the rapidly increasing coal-to-chemicals production attempts to displace with the use of coal, albeit at a cost of increased CO2 emissions.
The contraction in construction volumes, caused by a slowdown in real estate that began in 2021, is weighing on the demand for cement and steel. Besides the direct effect of less real estate construction, local government revenues are dragged down by a fall in land sales, affecting their ability to spend on infrastructure construction.
These changes in demand for energy can been seen in the figure below, which shows contributions to the change in China’s CO2 emissions in the second quarter of this year.
While CO2 emissions did fall in the second quarter, the rate of CO2 intensity improvements fell short of the level needed to meet China’s 2025 carbon intensity commitment.
The country’s goal is to reduce emissions relative to GDP by 18% from 2020 to 2025, with progress until 2023 falling far short of the target.
As reported GDP growth slowed to 4.7% in the second quarter, and CO2 emissions fell by 1%, CO2 intensity improved by 5.5%, short of the 7% annual improvement needed in 2024-25 to get back on track.
Improvements are also easier to achieve this year than they will be in 2025, as the rebound of hydropower from the low availability in 2022–23 helps reduce emissions. This is a one-off tailwind that is not likely to be present in 2025.
One part of the energy-intensive industry that China has been relying on to drive economic growth is the manufacturing of clean energy technologies. In response, some commentators have exaggerated the CO2 impact of Chinese factories making solar panels, EVs and batteries.
In reality, however, the manufacturing of these goods was responsible for 1.6% of China’s electricity consumption and 2.9% of its emissions in the first half of 2024, based on calculations using publicly available data.
The same calculations show that their CO2 emissions and electricity consumption increased by approximately 27% in the same period, contributing a 0.6% increase in China’s total fossil CO2 emissions and 0.4% increase in electricity consumption.
Looking ahead to the rest of this year, energy consumption growth is expected to cool. The China Electricity Council projects electricity demand growth of 5% in the second half of the year, compared with 8.1% in the first half, and the National Energy Administration expects full-year gas demand growth to moderate to 6.5–7.7%, from 8.7% in the first half.
If these projections are accurate, then the continued growth of clean energy consumption would be sufficient to push China’s CO2 emissions into decline this year.
However, the faster-than-expected energy demand growth in the first half of the year dilutes the emission reductions from the country’s record clean energy additions, and adds uncertainty to whether China’s emissions will indeed fall in 2024 compared with 2023.
If the growth rates of energy demand, by fuel and sector, seen in the second quarter of this year continue into the third and fourth quarter, with similar continuity in the growth rates of non-fossil electricity generation, then China’s emissions would stay flat in 2024 overall.
Energy consumption growth could also be moderated by a renewed policy focus on energy and climate targets. In May of this year, the State Council, China’s top administrative body, issued an action plan on energy conservation and CO2 emission reductions in 2024–25.
This plan is notable both for the unusual time period, covering the last two years of the five-year plan period, and for its high-level nature – energy conservation would normally fall under the jurisdiction of the energy and environmental regulators, rather than the State Council.
This suggests that the government recognises the shortfall against the 2025 carbon intensity and energy intensity targets. The action plan calls for meeting both of these targets, and lists numerous measures to be undertaken in response.
Yet the plan did not set numerical targets for 2024 that would be consistent with meeting the 2025 targets, which could be seen as taking a hedged approach of pushing for more action but not guaranteeing that sufficient results will be achieved.
Another State Council plan, released in late July, calls for speeding up the creation of a “dual control system” to control total CO2 emissions and emissions intensity. (Historically, China has never set numerical targets for total CO2 emissions, only aiming to limit CO2 intensity.)
According to the July release, the 15th five-year plan will set a binding carbon intensity target in the 2026-30 period, in line with previous five-year plans. For the first time, there will also be a non-binding, “supplementary” target for China’s absolute emissions level in 2030. Then, for each of the following five-year periods, there will be a binding absolute emissions target.
After the shortfall against the 2025 intensity target, the 15th five-year plan period would need to set a demanding intensity target to fulfil China’s 2030 commitments under the Paris Agreement.
The most important political meeting of the year, the “third plenum” of the Central Committee of the Communist Party, took place in July. The readout of the meeting mentioned carbon emissions reduction for the first time, but did not signal a shift to stimulating consumption. This could have driven less emissions-intensive economic growth, reducing reliance on higher-carbon manufacturing or infrastructure expansion.
The key focus of the meeting was promoting “new quality productive forces”, meaning advanced manufacturing and innovation. In practice, this likely implies a continued emphasis on manufacturing, with the potential for the energy-intensive economic growth pattern to continue.
Another indication that carbon emissions are receiving more policy emphasis is that the government appears to have stopped permitting new coal-based steelmaking projects since the beginning of 2024.
Hundreds of coal-based “replacement” projects were permitted in previous years, preparing to replace up to 40% of China’s existing steelmaking capacity with brand-new furnaces.
The shift away from new coal-based capacity is consistent with China’s target of increasing the use of electric arc furnaces – but progress towards that target had been lagging.
On coal-fired power, the government issued a new policy on “low-carbon transformation” of coal plants, aiming to initiate “low-carbon” retrofitting projects of a batch of coal power plants in 2025, with the target of reducing the CO2 emissions of those plants 20% below the average for similar plants in 2023, and another batch in 2027 aiming for emission levels 50% below 2023 average.
Under this transformation plan, emissions reductions at targeted coal plants are supposed to be achieved by “co-firing” coal with either biomass or “green” ammonia derived from renewables-based hydrogen, or by adding carbon capture, utilisation and storage (CCUS).
However, there are no targets for how many coal plants should be retrofitted, or what the incentives will be to do that, which will obviously determine the direct impact of this policy.
The impact could be small as biomass supply is limited, while the costs of ammonia and CCUS are high. For example, the International Energy Agency – among the more optimistic on power generation from biomass – sees its share rising from 2% in 2022 to 4.5% in 2035, if China meets its pledges on energy and climate IEA’s.
Furthermore, much of China’s coal-fired generation is already unprofitable, with almost half of the firms in the sector operating at a loss – even before taking on costly new measures.
The policy does however constitute Beijing’s first attempt at reconciling the recent permitting spree of new coal-fired power plants with its CO2 peaking goal for 2030, and looking for alternatives to early closure or under-utilisation of at least a part of the coal power fleet.
China’s emissions fell year-on-year in March and in the second quarter, as expected in my analysis for Carbon Brief last year.
Faster-than-expected growth in coal demand for the chemical industry, however, as well as industrial demand for power and gas, has diluted the emission reductions from the power sector, making the fall in emissions smaller than expected.
Nevertheless, China is likely still on track to begin a structural decline in emissions in 2024, making 2023 the peak year for CO2 emissions.
In order for this projection to bear out in reality, clean energy growth would need to continue and the expected cooling in energy demand growth in the second half of the year would need to materialise, with the new policy focus on energy savings and carbon emissions proving lasting.
The trends that could upset this projection include the economic policy focus on manufacturing, and the expansion of the coal-to-chemicals industry.
The surge in coal use for coal-to-chemicals is also a demonstration that even if power sector emissions begin to fall, as long as China’s climate commitments allow emissions to increase, there is the potential for developments that increase emissions in other sectors.
China has committed to updating its climate targets for 2030 and releasing new targets for 2035 early next year. These targets will be key in cementing the emissions peak and specifying the targeted rate of emission reductions after the peak – both of which have seismic implications for the global emissions trajectory and the level at which temperatures can be stabilised.
Data for the analysis was compiled from the National Bureau of Statistics of China, National Energy Administration of China, China Electricity Council and China Customs official data releases, and from WIND Information, an industry data provider.
Wind and solar output, and thermal power breakdown by fuel, was calculated by multiplying power generating capacity at the end of each month by monthly utilisation, using data reported by China Electricity Council through Wind Financial Terminal.
Total generation from thermal power and generation from hydropower and nuclear power was taken from National Bureau of Statistics monthly releases.
Monthly utilisation data was not available for biomass, so the annual average of 52% for 2023 was applied. Power sector coal consumption was estimated based on power generation from coal and the average heat rate of coal-fired power plants during each month, to avoid the issue with official coal consumption numbers affecting recent data.
When data was available from multiple sources, different sources were cross-referenced and official sources used when possible, adjusting total consumption to match the consumption growth and changes in the energy mix reported by the National Bureau of Statistics for the first quarter and the first half of the year. The effect of the adjustments is less than 1% for all energy sources, and the conclusion that emissions fell in the second quarter holds both with and without this adjustment.
CO2 emissions estimates are based on National Bureau of Statistics default calorific values of fuels and emissions factors from China’s latest national greenhouse gas emissions inventory, for the year 2018. Cement CO2 emissions factor is based on annual estimates up to 2023.
For oil consumption, apparent consumption is calculated from refinery throughput, with net exports of oil products subtracted.
The bulk of steelmaking around the world still relies on coal-based blast furnaces.
As a result, the steel and iron industry is responsible for 7% of greenhouse gas emissions and 11% of carbon dioxide emissions globally, according to the consultancy firm Global Efficiency Intelligence.
This is more than the total emissions from all the world’s cars and vans.
With steel critical to the building out of decarbonised energy infrastructure, production is expected to continue to rise over the coming years, meaning the potential for decarbonisation is “enormous”, according to not-for-profit data organisation Global Energy Monitor (GEM).
GEM’s annual “Pedal to the Metal” report reveals that 93% of new steelmaking capacity announced thus far in 2024 promises to use lower emission electric arc furnaces (EAFs).
It also shows that 49% of the world’s steelmaking capacity under development now uses EAFs, up from just 43% in 2023 and 33% in 2022.
Of this, nearly all of the capacity announced since the beginning of 2024 operates using EAFs, the non-governmental organisation’s Global Steel Plant Tracker (GSPT) shows.
The tracker covers 2,207m tonnes per year (mtpa) of operating steelmaking capacity and an additional 774mtpa of steelmaking capacity under development globally, across 1,163 individual plants in 89 different countries, analysis of which is captured in its annual report.
However, while the report suggests a positive progression towards lower emission technologies in the sector, the increase in the announced projects is not yet leading to a construction of EAF overtaking coal-based production methods.
Coal-based blast furnace-basic oxygen furnaces (BF-BOFs) – where blast furnaces are used to produce iron from ore and oxygen converters then turn this, with some additional elements, into steel – continue to dominate the projects under construction, meaning “pressure must be maintained all the way through to project completion if real progress is to be seen”, the report finds.
Incoming steelmaking capacity is more heavily EAF-based than ever before, according to GEM’s new report.
There is currently 774mtpa of steelmaking capacity under development, of which 223mtpa is in the advanced development stage.
Based on data from April 2024, the GSPT shows that nearly half of the capacity under development (337mtpa) is EAFs.
Just 36% of steelmaking capacity announced in 2020 with a known production route used EAFs, while in 2023 that number had increased to 92% according to GEM. This grows to 93% of capacity when looking at steelmaking capacity under development announced in 2024.
This “indicates a significant shift toward electric arc furnace steelmaking in the years to come”, the report notes.
Meanwhile, of the 212mtpa of steelmaking capacity slated for retirement, 88% if BOF-based.
However, a net increase in BOF-based capacity is expected over the coming years. If all planned developments and retirements take effect, an additional 171mptpa of BOFs is expected to be added to the global fleet, along with 310mtpa of EAF and 80mtpa of unknown technologies.
Despite this growth in BOFs, the surge of EAF means the steel sector is getting increasingly close to meeting the International Energy Agency’s (IEA) suggested 2030 target.
In its net-zero by 2050 roadmap, the IEA suggests that the share of steel produced by EAF should grow from 24% in 2020, to 37% by 2030 and then 52% by 2050.
Considering all planned capacity and retirements, GEM now estimates that the global steel fleet is expected to reach 36% EAF by 2030, noting: “This is still not sufficient to meet the IEA [net-zero] climate target, but with heightened momentum the goal is increasingly attainable.”
While EAF-steelmaking is being announced at “record rate”, GEM finds that less than 14% of this potential capacity has moved into construction.
Of those that have moved into construction, around 46% are still BOF-based. As such, “while we may be within reach of net-zero targets based on proposed electric arc furnace capacity, actually achieving these goals requires follow-through”, the report notes.
Caitlin Swalec, program director for heavy industry at GEM, said in a statement:
“The progress is promising for a green steel transition. Never before has this much lower-emissions steelmaking been in the pipeline. At the same time, the buildout of coal-based capacity is concerning. What the industry needs now is to make these clean development plans a reality, while backing away from coal-based developments.”
As well as the buildout of new coal-based capacity being out of alignment with a net-zero future, it poses a threat of carbon lock-in and stranded assets, GEM notes.
Blast furnaces are becoming riskier investments given the limited options to mitigate emissions from both the furnaces themselves and the upstream emissions from the metallurgical coal mining, it adds.
Estimating an investment of $1-1.5bn per mtpa capacity at an integrated BF-BOF site, GEM found that the future stranded-asset risk could be as high as $554bn in 2023, falling to $400bn in 2024 due to the continued fall in BOF capacity under development.
Astrid Grigsby-Schulte, project manager for steel at GEM tells Carbon Brief:
“As we grow closer to key decarbonisation milestones, coal-based developments get further out of alignment with the direction the industry is moving and present a greater risk of stranded assets to steelmakers. Coal-based, emissions-intensive blast furnaces represent significant investments that often require decades to recoup. This makes them extremely risky for developers, particularly in countries with stated net zero commitments.”
The limited options for mitigating the climate impact of BOF-steelmaking was also highlighted within a recent report from the thinktank Sandbag.
While carbon capture, utilisation and storage (CCUS) is often touted as a “catch all” solution, its effectiveness varies widely across applications, Sandbag’s “Steel & CCS/U” report finds.
For steel production, BF-BOFs with carbon capture are unlikely to be cost-competitive with EAFs, the report finds. Although given the slow pace of technological and market development, Sandbag anticipates capturing carbon will play a limited role in the steel industry.
India has now replaced China as the top steel developer globally, with a pipeline of 258mtpa of capacity, of which 177mtpa is BOFs, according to GEM.
China has a pipeline of 150mtpa meaning, collectively, China and India are responsible for 53% of all developments globally.
Asia operates 68% of all steelmaking capacity (1,508mtpa), the majority of which is in China (1,075mtpa), India (123mtpa) and Japan (109mtpa).
When looking specifically at emissions-intensive BOF production, Asia’s share of total operating capacity increases to 80% (1,181mtpa), of which 918mtpa is in China.
Currently, China has 157mtpa of operating EAFs (22% of the global capacity), followed by the US, Turkey, Iran and then India.
According to a new report from the Centre for Research on Energy and Clean Air (CREA), China did not issue any new permits for coal-based steelmaking in the first half of 2024. This is the first time this has happened since the nation’s “dual carbon goals” were announced in September 2020.
During the first six months of 2024, Chinese provincial governments permitted 7.1mtpa of steelmaking capacity, all of which were EAFs marking a “turning point” for the country’s steel industry, CREA notes.
Xinyi Shen, researcher at CREA and the report’s lead author, tells Carbon Brief: :
“China’s EAF steelmaking has been developing rather slowly in the past few decades, mainly due to the constraint of scrap supply. However, as China’s steel demand reaches its peak and more scrap becomes available, a major opportunity arises to reduce emissions in the next 10 years. The government has accelerated plans to expand the national ETS to include the steel sector by the second half of 2024. By implementing carbon pricing on carbon-intensive products, EAF steelmaking would become more economically competitive and continue the growth.”
Despite India now overtaking China in terms of announced steelmaking capacity, China remains the biggest developer of EAF capacity overall, GEM’s report states. And while India has the most steel in development, 84% has not moved into construction.
As such, there is still an opportunity for India’s plans to change, with the percentage of BOFs to EAFs less set.
Chris Bataille, adjunct research fellow at the Columbia University Center on Global Energy Policy and lead author at the global Net Zero Steel project tells Carbon Brief:
“India’s core demand for steel is set to increase from 125mtpa to ~450mtpa by 2050, especially to meet key building and infrastructure needs. Our modelling suggests EAFs consistently rise from ~35 to 150mtpa by 2050. So the +250mtpa BF-BOFs is just barely feasible, but only over ~25 years and with some exports of BF-BOF steel.
“The difference will be between a world where strong climate policy succeeds and fails. If it fails and coal based BF-BOFs are built, then the +258mtpa looks barely feasible. If it succeeds, India is short on the necessary gas and especially clean electricity to power this amount of steel production. While the country does build a lot of EAFs, it builds up to 250mtpa of clean iron making over time, making the short term shortfall with clean HBI iron imports.”
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ELECTRIC VEHICLES:
NUCLEAR: The success of a newly signed law boosting small nuclear will depend on the makeup of the Nuclear Regulatory Commission, which hinges on the next president, industry experts say. (E&E News)
HYDROGEN: U.S. Senate Democrats call on the Treasury secretary to relax rules for federal hydrogen industry subsidies, which require the use of only clean energy generated at the same time as the hydrogen fuel. (The Hill)
CLEAN ENERGY:
GRID:
CLIMATE: A Baltimore City Circuit Court judge throws out the city’s climate accountability lawsuit against several major oil companies, saying the case sought to go “beyond the limits of Maryland state law.” (Reuters; E&E News, subscription)
HYDROPOWER: An Oregon university begins construction of the nation’s first utility-scale wave power testing site along the state’s central coast. (KOIN)
COAL: Coal-fired power plants are becoming increasingly unreliable because of deferred maintenance, increased cycling and other factors, according to the North American Electric Reliability Corp. (Utility Dive)
CLIMATE:
OIL & GAS: In New Mexico, oil and gas giants partnered with environmentalists and politicians to develop an abandoned well cleanup bill, but turned against the final product and claimed it would “destroy” the state. (ProPublica)
ELECTRIFICATION:
SOLAR: A Wyoming economic development official proposes installing solar arrays on reclaimed Powder River Basin mines to replace lost coal tax revenue and jobs but runs into opposition from residents loyal to fossil fuels. (Inside Climate News)
GRID:
EFFICIENCY: Honeywell debuts a plug-level energy monitor that could help offices realize the energy savings of unplugging devices when they’re not being used. (Utility Dive)
WIND:
ELECTRIC VEHICLES: An organization representing gas station chains calls on Florida officials to begin taking applications for funding to build electric vehicle charging stations. (Tampa Bay Times)
POLITICS: Observers expect West Virginia’s longstanding influence on federal energy policy to fade this fall as Sen. Joe Manchin steps down and is likely replaced by a pro-fossil fuel Republican. (Inside Climate News)
TRANSPORTATION: Illinois health and environmental groups call on the state’s pollution control agency to phase out sales of most gas- and diesel-powered vehicles by 2035. (Chicago Sun-Times)
CLEAN ENERGY:
AIR POLLUTION: The U.S. Supreme Court sides with Ohio and Indiana by pausing enforcement of the Biden administration’s “good neighbor” rule aimed at preventing downwind air pollution crossing state borders. (Associated Press)
SOLAR: A Chicago-based nonprofit offers 10- to 13-week courses that equip disadvantaged workers with job skills for the state’s growing solar industry. (Chicago Sun-Times)
RENEWABLES: Americans’ support for renewable energy and electric vehicles is declining with older Republicans driving the drop in support since 2020, according to a new Pew survey. (Bloomberg)
NUCLEAR:
COAL: Coal plants in Ohio and Indiana have lost hundreds of millions of dollars so far this year as the costs to operate plants grow compared to cheaper alternatives. (Checks & Balances Project)
GRID: New research suggests utility customers could see bill savings of up to 40% when rooftop solar, battery storage and other demand-reducing technologies are deployed. (Inside Climate News)
ELECTRIFICATION: A $2.2 billion hospital under development in Detroit will include a $235 million electric heating and cooling system that would make it just the second all-electric hospital in the country. (Crain’s Detroit, subscription)
COMMENTARY: The head of a biogas advocacy group says capturing methane from landfills, agricultural waste and other sources to produce electricity could help meet growing power demand. (Utility Dive)
The operators of the decades-old energy systems that heat and cool buildings in downtown Minneapolis and St. Paul have ambitious plans underway to reduce emissions.
The mostly hidden networks of insulated pipes connected to centralized heating and cooling equipment are known as district energy systems. They’ve long been championed as an energy efficient way to heat and cool campuses or downtowns, especially in cooler climates.
Many, though, are connected to fossil fuel facilities, and the systems’ high efficiency alone won’t be enough to help schools, cities, and companies meet their goals of eliminating greenhouse gas emissions by midcentury or sooner. Climate pledges by these institutional customers are now driving efforts to repower district energy systems with clean energy.
University district energy systems began initiatives to reduce emissions years ago and “now in the last five years we’re seeing a lot of emphasis on this from cities and towns,” said Rob Thornton, president and CEO of the International District Energy Association.
In Minneapolis, Cordia Energy, the private company that operates the largest downtown district energy system, is replacing natural gas boilers with electric models. And in downtown St. Paul, officials are seeking federal funding for a project to recover heat from a wastewater treatment plant and reduce energy use for a system currently powered by electricity and biomass.
“We’re doing decarbonization at the rate that our customer base is asking for and we can economically withstand,” said Jacob Graff, Cordia Energy’s north region president. Customers connected to its downtown Minneapolis system range from stadiums and high rises to apartments and medical facilities.
The concept of district heating has been around for centuries, with its roots in the networks of hot water pipes built in ancient Rome. Some of the first modern steam-based systems were built in New York in the 1880s. Today, the United States has more than 700 district energy systems heating and cooling buildings in downtowns, universities, medical campuses, towns and communities.
Cordia Energy’s Minneapolis system opened in 1972 to serve the 57-story IDS Center, still the tallest building in Minneapolis. Today, the steam and chilled water system manages seven plants that heat and cool the IDS and more than 100 other buildings, including U.S. Bank Stadium, Target Center, and the convention center.
Hennepin County owns and operates a much smaller district energy system, connected to a downtown trash incinerator, that primarily serves county buildings and Minneapolis City Hall.
District Energy St. Paul began in the early 1980s after then-Mayor George Latimer hired Swedish engineer Hans Nyman to replace the aging steam system with a hot-water central heating system. Latimer wanted to create a national model of district energy and he largely succeeded. District Energy St. Paul has the largest hot water system in the country, with more than 200 buildings.
Together, the two systems serve some of the state’s biggest buildings, which have emerged as the largest source of greenhouse gas emissions in both cities. In Minneapolis, 65% of the emissions are from commercial, multifamily and industrial buildings. St. Paul’s data is similar.
Cordia plans to reduce emissions from its Minneapolis system by 30% by 2030 before reaching net zero by 2050. Xcel Energy’s green tariff program will offset around half the electricity Cordia uses this year, and it wants to buy more credits if they become available.
The company is replacing older engine-driven chillers with electric models at the former Dayton’s department store, where it has operations. Chillers modulate the temperature inside buildings and can be powered by electricity or natural gas. Geothermal is another potential solution being studied.
A potential geothermal project “hasn’t cleared the economic hurdles yet,” Graff said. “I think we’ll eventually get there.”
Minneapolis customers are not alone in seeking to reduce emissions from district energy systems, Graff said. San Francisco will be Cordia’s first system to decarbonize using hydropower from a dam the company owns in Yosemite National Park.
Downtown St. Paul’s district heating system is owned and operated by a company called District Energy, which recently worked with the city and the regional planning agency on a $152 million U.S. EPA grant application to tap heat from a regional wastewater plant for the city’s system. It would include a project with Xcel Energy to pay for an electric boiler and hot water storage.
District Energy president and CEO Ken Smith said half the system already has been decarbonized through biomass, solar thermal and renewable energy credits. An analysis showed that recovering heat from the Metro Wastewater Treatment Plant, which manages 170 million gallons of water daily, could produce 60 megawatts of thermal energy, and heat pumps could lift the temperature up to the system average.
If District Energy receives the Climate Pollution Reduction Grant, the system would go live in 2028 and allow District Energy to provide 92% of energy from carbon-free or carbon-neutral sources, far ahead of its goal of net zero by 2050.
“This certainly would be able to accelerate that by 30 years,” Smith said. “From everything we’ve seen, there’s nothing like this, certainly not in the United States, and I don’t believe there’s anything like it at this scale in Canada, either.”
St. Paul Resilience Officer Russ Stark said District Energy’s emissions represent a small portion of the total greenhouse gases in the city. Still, around 50,000 tons of carbon would be eliminated annually, and that’s “very impactful,” he said.
The wastewater project would allow District Energy St. Paul to expand to more buildings, decarbonizing them in the process, Stark said. Adding clients “is not a simple process but we’ve been talking a lot about that being an exciting part of the project,” he said. “I don’t know how many major city downtowns there are where there’s an opportunity to largely decarbonize most of the downtown in the way that we can.”
A one-size-fits-all solution for decarbonizing district energy systems doesn’t exist, as most are unique based on customers and geography. Not all can be inexpensively retrofitted for electricity, and the ongoing office and commercial real estate fallout from the Covid-19 pandemic adds risk to financing projects.
Thornton, of the district energy association, said electricity pricing can escalate quickly, especially in summer, creating uncertainty in the market. New technology may require more space, different controls and significant staff training. Federal policy remains unclear about what parts of a district energy system would qualify for tax incentives, he said.
Graff ticks off many challenges in decarbonizing Cordia’s Minneapolis operations. Geothermal works well on campuses and in low-slung neighborhoods where the problem of sending steam to the 50th floor of a skyscraper does not exist, Graff said.
There’s not a simple clean power source like natural gas that has the energy density to create and push steam through a network, he said. To illustrate the point during a tour of Cordia’s downtown plant, he pointed to a pipe with a modest circumference and said the natural gas flowing through it provided the heating for much of the system.
Electrification may be a goal of heating and cooling, but offsetting it with clean power is daunting. Cordia would have to install heat pumps capable of drawing more than 400 megawatts from a clean energy source, which would be no small feat, Graff said.
Hydrogen sounds promising but has no track record yet for supplying an entire downtown district energy system, Graff said. Biomass has potential, too, but sourcing enough it to service a sprawling district energy system reliably remains difficult.
Battery storage, microgrids and other technologies could all play a role, but each brings issues ranging from cost to a lack of testing in a district energy environment, at least at the size of the downtown Minneapolis system.
“We have the economy of Minneapolis in our hands, and regional economics depend on downtown Minneapolis,” Graff said “We need a reliable infrastructure that people can count on that can be delivered economically, and it’s our responsibility to do that.”
CLIMATE: Hawaii recognizes children’s constitutional right to a life-sustaining climate and steps up efforts to reach a goal of net-negative emissions by 2045 to settle a youths’ lawsuit targeting the state’s fossil fuel-friendly policies. (Associated Press)
HYDROPOWER: A rural Alaska community prepares to use federal funding to construct a run-of-the-river hydropower project aimed at reducing the village’s reliance on diesel generators. (KTOO)
ELECTRIFICATION: A study finds California utilities could save about $20 billion over the next two decades by electrifying clusters of buildings instead of replacing their aging natural gas pipelines. (Utility Dive)
STORAGE:
UTILITIES:
ELECTRIC VEHICLES:
OIL & GAS:
PUBLIC LANDS: A federal Bureau of Land Management plan to expand protections on some public lands in western Colorado while leaving 855,300 acres open to oil and gas leasing draws mixed reviews from advocates. (news release)
GRID: California’s grid operator begins shifting governance of its extended day-ahead power market to an independent entity. (RTO Insider, subscription)
BIOFUELS: Nevada researchers find prickly pear cactus fruit are a climate-resilient source of biomass for fuel production. (news release)
COAL: A Wyoming explosives maker says declining Powder River Basin coal production has driven down its sales by 19% this year. (Cowboy State Daily)
COMMENTARY: A California editorial board calls on state lawmakers to require cooling equipment in residential rental units to keep occupants safe during increasingly frequent climate change-exacerbated heat events. (Los Angeles Times)
Biogas projects at wastewater plants serving Columbus and Cincinnati will offset roughly 50,000 metric tons of greenhouse gas annually, according to city officials.
The Columbus Department of Public Utilities estimates biogas cogeneration projects for its Southerly and Jackson Pike plants will reduce greenhouse gas emissions by about 34,000 and 13,000 metric tons of carbon dioxide equivalents, respectively. That’s the equivalent of taking 10,100 passenger vehicles off the road, said Robert Priestas, administrator for the department’s division of sewers and drains.
The utilities also can get back millions under the Inflation Reduction Act if they meet conditions by the end of this year.
“Climate change is upon us, right? And so we have an opportunity to actually make a difference,” said Stacia Eckenwiler, who serves as assistant administrator for the division. She spoke at the Ohio State Bar Association’s Environmental Law Institute in April.
Columbus’s wastewater utility accounts for a significant chunk of the city’s greenhouse gas emissions, she noted. A 2019 inventory report shows water and wastewater accounted for about 9% of nearly 11 million metric tons of carbon dioxide equivalents from community-wide emissions that year.
The Metropolitan Sewer District of Greater Cincinnati is also planning to use biogas to make electricity and provide heating for its Little Miami Wastewater Treatment Plant. The facility still needs to add equipment to generate and capture the biogas to shift some greenhouse gas emissions away from where wastes are now landfilled, and offset some fossil fuel emissions from energy otherwise used at the plant.
Sewage treatment plants remove solids and harmful pollutants from wastewater. Most often, the cleaned-up water goes into a river, lake or other water body near the treatment plant, generally pursuant to permits issued under the Clean Water Act. Leftover sludge containing biosolids has generally ended up in incinerators or at landfills.
Burning of biosolids releases carbon dioxide to the air, and landfilling biosolids likewise releases greenhouse gas emissions. Both options cost sewer plants money to dispose of the wastes.
Anaerobic digestion is another option. Basically, it composts the biosolids to speed up their chemical breakdown. Solids left at the end can generally be added to soil or used in other ways. The process also produces biogas, which is primarily a mix of flammable methane and carbon dioxide. Burning the methane can power an electric generator and also provide heat energy.
In contrast to methane from natural gas, which is a fossil fuel that contributes to human-caused climate change, the methane from wastewater sludge is generally considered clean energy when it’s used for electricity and heating.
The gas is generated anyway, explained Karine Rougé, CEO of Veolia North America’s Municipal Water services. So, using it works as “a perfect substitute” for fossil fuels, she said. Veolia is not involved in the Cincinnati or Columbus projects.
Beyond that offset, “the methane in natural gas is extracted from subsurface rock formations from a depleting source that cannot be replenished,” said Diana Christy, the director of the Metropolitan Sewer District of Greater Cincinnati. In contrast, biogas is renewable, “in the sense that humans always will produce waste.”
Columbus already has a composting program, which began several years ago after stricter regulations meant it could no longer use old incinerators. Now, “all of the biosolids that are produced by our facilities go back to the earth and get used again,” Eckenwiler said. Uses include compost and fertilizer for tree farms.
So far, however, the city has just burned the biogas with a flare. “It’s a wasted resource overall,” she says. That’s set to change.
Biogas projects at the Southerly and Jackson Pike wastewater treatment plants will provide “about half the energy that is necessary at each of our facilities, so it’s a pretty significant amount,” Eckenwiler said. “And that will take that reliance off the grid,” which can help at times of peak demand.
Besides advancing sustainability and the cities’ decarbonization goals, sewer utilities for Columbus and Cincinnati see the projects as a way to reduce costs and respond to shifts in regulatory requirements.
The technology for anaerobic digestion has been around for years, but it has improved recently, Christy said. “Most simply for us, the ‘why now’ is it was an economic decision and the changes in requirements for incineration that we were facing previously.”
Eckenwiler estimated Columbus’s biogas projects will save the city roughly $1 million for the two plants’ energy costs — about half of what they currently spend while biogas is otherwise vented to the air.
She also noted the federal government’s efforts to reduce emissions from the oil and gas industry. “It’s only a matter of time before wastewater utilities are going to be part of that as well,” she said.
The Inflation Reduction Act provides an added economic incentive through its changes to the federal Investment Tax Credit. Previously the credit benefited only people and organizations that paid taxes. The changes now let government units and nonprofits get money back as a reimbursement when projects are finished.
The 2022 law also expanded the Investment Tax Credit to more types of energy projects, including biogas. To qualify, biogas projects must begin construction by the end of this year. The law also provides a “safe harbor” if there’s a commitment to buy at least 5% of the necessary equipment and it is in significant fabrication by or before December 31, Eckenwiler said.
The Jackson Pike project is already under construction and should finish up by sometime next year, Eckenwiler said. The Southerly project is on track to start construction this year and should be complete by 2028.
Cincinnati plans to start construction at the Little Miami plant this year under a design-build contract that lets construction begin while various details are finalized, Christy said. The district is also evaluating the safe harbor provision and considering a purchase of equipment for $11 million before the end of this year, with expected delivery before April of 2024.
The Jackson Pike project for Columbus is estimated to cost about $30 million, Eckenwiler said. “The project at Southerly is part of a much larger project, but the cogeneration portion is about $79 million.” The Investment Tax Credit could provide rebates up to 50%. That includes bonuses for paying prevailing wages and using domestic content, as well as a bonus for projects in or next to an “energy community.”
Parts of Cincinnati’s project that qualify for the Investment Tax Credit could provide up to $50 million in reimbursements, Christy said. Whatever the amount is, “the impact of a direct cash payment from the federal government will serve to reduce the cost burden on local ratepayers as the sewer district reinvests in infrastructure to maintain levels of service and to improve the sewer system in order to better serve the community and to comply with the Clean Water Act.”
Rougé sees a broader trend towards wastewater plants using biogas for energy. In Europe, a prolonged drought and the war in Ukraine have ramped up interest in local energy production, she said. And energy costs have been a major driver in the United States, she said. A desire to boost resilience also weighs in favor of adding biogas or other onsite generation, particularly in states where grid issues already present problems, she added.
Onsite biogas projects may not be cost-effective for some smaller sewer utilities. Yet the Inflation Reduction Act’s deadline is sparking lots of conversations with Veolia’s clients, Rougé said. And even if a wastewater authority doesn’t begin a project yet, other funding support could be available, such as state revolving funds under the Clean Water Act, she said.
Wastewater treatment plants are “complex and technical places,” Eckenwiler said. “They’re also very, very cool resource recovery facilities.”
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