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Good morning, nice people. We have a bumper issue this morning with news piling in from every corner of the region across a range of subsectors, but first, a fizzle and pop happened at the UN plastic waste treaty talks…
THE BIG CLIMATE STORY OUTSIDE THE REGION- Plastic waste treaty talks end with no agreement: Negotiators failed to reach an agreement yesterday on how to curb plastic pollution after week-long negotiations — in what was slated to be the last round of talks — ended. A coalition of 102 nations — led by the Pacific Small Island Developing States, Panama, the European Union, and 38 African countries — are pushing for legally binding plastic production caps, while oil-producing nations, including Russia and Saudi Arabia, prefer to focus on the end-side of the plastics lifecycle by tackling waste management.
What went down: Disagreements on the approach lingered until the last minute when the meeting’s chair Luis Vayas Valdivieso presented a revised document (pdf) on Sunday that highlighted the wide divide on key issues such as production caps, managing plastic products, and financing for developing countries. The latest draft includes various options for key sections, including targeted bans on a few materials, a compromise to set production targets at a future conference or to drop the idea altogether. A reconciled text was not reached, with the anti-production-caps bloc holding ground on the argument that caps fell outside the mandate of the treaty. The Saudi delegation argued that capping production “penalizes industries without addressing the actual issue of plastic pollution.” Both the US and China were absent from the stage on the last day leaving their stance unknown.
What now? The delegates agreed to meet again next year at an unspecified time for another round of talks and negotiations.
The story made headlines in the international press: Reuters | AP | Bloomberg | The Guardian | The Financial Times | The New York Times | Politico
HAPPENING THIS WEEK-
The Conference of the Parties (COP16) to the United Nations Convention to Combat Desertification will kick off today in Riyadh and run through to Friday, 13 December. The summit will convene leaders and officials from 196 member-states and territories to advance actions and hold ministerial dialogues on resilience and finance, focusing on policies, tech and innovative funding mechanisms.
The World Energy Storage Conference will open its doors tomorrow in Doha and run through to Thursday, 5 December. The event will gather scientists, researchers, engineers, policymakers, and industry experts to discuss advancements and challenges in energy storage technology. The full agenda can be found here.
WATCH THIS SPACE-
#1- Egypt is seeking the EU’s technical and financial support to address the impact of the bloc’s imminent Carbon Border Adjustment Mechanism (CBAM), according to a statement released on Saturday. CBAM is the world’s first CO2 border tax and will require firms exporting steel, cement, aluminum, electricity, fertilizers, and hydrogen into the EU to report CO2 emitted during manufacturing and eventually charge pollution fees on those products by 2026.
REMEMBER- The CBAM will have a big impact on Egyptian industry and export revenues: The EU is Egypt’s largest trading partner, accounting for 31.1% of the country’s exports in the 2022-2023 fiscal year, according to data (pdf) from the central bank. EU-bound exports of aluminum accounted for 79% of Egypt’s total aluminum exports in 2022, along with 36.7% of iron and steel exports, 30.6% of fertilizer exports, and 4.1% of cement exports, according to World Bank data.
ICYMI- Egypt is already preparing for EU exports: Egypt’s Export and Import Control Authority has set up a lab to measure carbon emissions from the biodegradation of various exported products, the launch of which was revealed at a February meeting with EU officials to discuss the impacts of the CBAM on Egyptian exports to the EU.
IN OTHER EGYPT NEWS- Egypt’s Arab Contractors held talks with Algerian Energy and Mines Minister Mohamed Arkab to explore cooperation in energy, mining, and renewable energies, according to a statement published last week. The talks explored avenues for collaboration and investment between Algerian and Egyptian companies including Sonatrach, Sonelgaz, and Sonarem in areas including the development of minerals processing facilities, and electricity interconnections and production.
#2- The UAE to get one or two large-scale solar projects every year until 2030, the National reported last week citing Energy Minister Suhail Al Mazrouei. The country is now seeing “probably the highest demand” for energy as the economy continues to grow, Al Mazrouei said. The push is also part of an overall effort to achieve net zero by 2050 and 30% energy from renewables by 2030. UAE currently generates around 6 GW of renewable energy and targets to increase this to at least 15 GW by 2030.
UAE’s solar capacity is rising: The Emirates Water and Electricity Company (Ewec) invited developers and consortiums to submit an Expression of Interest (EOI) for the development of the 1.5 GW Zarraf solar PV IPP in Abu Dhabi’s Al Dhafra Region in October. This followed previous projects, including the now-operational 2 GW Al Dhafra solar PV, the under-development 1.5 GW Al Ajban solar PV, and 1.5 GW Khazna solar PV, which is still in the tendering process.
ALSO- The UAE’s Green Coast is mulling a USD 50 mn renewables and infrastructures investment push in Egypt over the next three years, CEO Mohamed Abdulghaffar Hussein told Asharq Business on Thursday. The Dubai-based company specializes in renewable energy and sustainability, as well as real estate and investment management by forging international partnerships.
#4- We are one step closer to a common Arab electricity market: Arab nations are set to sign two agreements to establish a common Arab electricity market during a two-day session of the Arab Ministerial Council for Electricity that kicked off yesterday at Egypt’s new administrative capital, according to a statement released on Saturday. The agreements will cover the founding principles of the joint market and its institutions and the legislative framework for its enforcement, including harmonizing national laws to ensure proper governance of the market.
The unified market aims to connect and harmonize the energy systems of 22 Arab countries by 2038, with phased implementation starting 2025, Arab League Energy Director Jamila Matar previously said. The market is expected to operate on a commercial mechanism, enabling energy exchange by utilizing surplus electricity from member states. The initiative, Matar added, could draw on the Gulf electricity interconnection project as a model for success.
There’s more on regional cooperation: Also on the agenda is a document outlining a green hydrogen strategy for the Arab region as well as the launch of an Arab Green Hydrogen Network, according to a separate statement. The meeting will also discuss supporting the localization of the manufacturing of electricity transmission and distribution equipment in the Arab world. Lastly, the meetings will see the pilot launch of the energy exchange project between Jordan, Saudi Arabia, and Egypt.
#5- ICJ to hold hearings on states’ climate obligations: The International Court of Justice (ICJ) is beginning hearings (pdf) today on the obligations of countries to combat climate change, Reuters reported on Friday. The process, driven by small island states, aims to address the consequences for nations contributing to global warming. The court’s opinion, expected in 2025, will provide a non-binding advisory opinion on the responsibilities of states to protect the climate under international law and the potential liability of large emitters for damages to smaller nations.
What to expect? Starting today and until 13 December, the ICJ will hear from 98 countries and 12 international organizations, including major greenhouse gas emitters like the United States, China, and the OPEC group. Vanuatu — a Pacific island nation severely affected by climate change — will be the first to present its arguments. The ICJ’s advisory opinions are non-binding, but they hold significant legal and political weight and are expected to influence climate litigation globally, Reuters reports.
#6- Carbon markets could be looking up: Trading firm Trafigura Group is gearing up for growth in the carbon credits market on the back of new global regulatory frameworks set to make the financing instrument go mainstream, Trafigura’s global head of carbon trading Hannah Hauman told Bloomberg last week. The company is already working on new offset projects, including a recently-announced USD 500 mn carbon credits investment to restore African woodlands.
The outlook: Despite a recent slump in the voluntary carbon market due to greenwashing allegations, lack of regulations, and declining prices, regulatory developments in Europe, the US, and Asia are creating a more structured market. COP29’s recently advanced rules for a new UN-guided market also provided a clearer framework for countries to participate, burnishing an increasing regulatory clarity that could drive demand for carbon credits, particularly those based on emissions removals.
Some experts are still wary: Inconsistent definitions and the potential for an “anything goes” market under Article 6.2 could undermine climate action, Kleinman Center for Energy Policy’s senior fellow Danny Cullenward told Bloomberg. Commenting on the COP29 agreement, Carbon Market Watch policy expert described the rules as “weak,” blasting the approach as one that defers “consequences” for later rather than “preventing them.”
WORTH READING-
Northvolt’s recent bankruptcy proves overcoming China’s EV dominance needs more than substantial public subsidies and strong market demand, Semafor wrote last week. That could mean that the survival of European and American battery manufacturers needs a new strategy, Semafor wrote.
What went wrong? Northvolt aimed to differentiate itself from Chinese competitors by attempting to reach a competitive edge in emerging battery technologies like recycling and sodium-ion batteries instead of the China-dominated lithium-ion battery market. To do this while also maintaining its current clients, the company recklessly burnt through money, overextending itself with multiple facilities and technologies, clean tech investment firm Generate Capital president Bill Sonneborn told Semafor.
An underrated ‘pervasive mistake’: Another fatal mistake was not investing enough in the human resources necessary to sustain the massive operational expansion and focusing instead on the “nerdier pursuit of intellectual property,” Sonnebord said. This mistake is “pervasive” in the climate tech sector, he added.
ICYMI- Northvolt filed for Chapter 11 bankruptcy protection in the US last month, citing a dire liquidity situation after failing to secure rescue funding, leaving it with enough cash to support operations for only a week. Northvolt secured USD 100 mn in new financing from its customer — Volkswagen-owned Swedish truck maker Scania — to support the bankruptcy process and has USD 5.84 bn of debt on the books.
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CIRCLE YOUR CALENDAR-
UAE will host the International Mangrove Conservation and Restoration Conference from Tuesday, 10 December to Thursday, 12 December in Abu Dhabi. The conference — happening in parallel to Riyadh’s COP16 on desertification — will gather global scientists and conservation experts dedicated to mangrove and coastal ecosystem restoration, seeking to share research, innovative approaches, and best practices for holistic restoration, including habitat diversity, connectivity, and climate resilience.
The UAE will host the World Energy Summit from Tuesday, 14 January to Thursday, 16 January in Abu Dhabi. The summit will host over 350 speakers including energy industry leaders and policymakers with discussions ranging from eco-waste to sustainable cities. An exhibition will also be held for showcasing green products.
Saudi Arabia will host the Future Minerals Forum from Tuesday, 14 January to Thursday, 16 January in Riyadh. The forum will gather stakeholders from over 170 countries to discuss mineral technology and exploration. Speakers will include senior government officials and CEOs from renowned mining companies Vale, Rio Tinto, and Manara.
Bahrain will host the Sustainability Forum Middle East from Tuesday, 28 January to Wednesday, 29 January in Manama. Climate experts and decision-makers will convene to discuss a number of issues ranging from decarbonization to supporting SMEs on their path to net zero. Speakers will include GCC government officials and industry leaders from the banking and industrial sectors.
Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.
