Good morning, friends. It’s a quiet morning for the climate industry in our region, but we have a compact issue with some interesting developments in EV battery tech and good news regarding our green steel export capacity.

THE BIG CLIMATE STORY- OCI-Adnoc JV Fertiglobe has sent its first green ammonia shipment to India from its green hydrogen plant in Egypt. The green ammonia shipment was the world’s first to carry an ISCC Plus certification applicable to circular economies

^^ We have the details on this story and more in the news well, below.

THE BIG CLIMATE STORY OUTSIDE THE REGION- The world has a 14% chance of meeting the 1.5°C warming limit at best, according to the UN’s Emissions Gap report released yesterday. The report assessed the Nationally Determined Contribution of countries around the world, and found that if current unconditional pledges — promises with no strings attached — to limit carbon output are met, the world’s temperatures would rise by 2.9°C above pre-industrial levels by the end of the century. Meeting conditional pledges would lead to a 2.5°C increase in global temperature by 2100, the UN added. Though the world has made progress since the Paris agreement in 2015, this year’s forecast is higher than 2022’s projections of 2.4- 2.6°C hike by 2100. Under a 3°C warming scenario, the Amazon rainforest could dry out and ice sheets would melt at exponential rates. To meet the Paris-agreed 1.5°C warming threshold, countries will need to push down their greenhouse gas (GHG) output by 42% from current levels by 2030, the UN says.

The story made headlines in the international press: Reuters | The Washington Post | CNN | ABC News | Deutsche Welle | The Guardian | France 24 | Bloomberg

WATCH THIS SPACE #1- Egypt’s MPs back hydrogen incentives: The Egyptian parliament’s Energy and Environment Committee has given preliminary approval for a draft law on boosting green hydrogen incentives, Youm7 reports. According to the provisional bill, the state would offer between 33% to 55% of tax breaks on revenues generated from local green hydrogen projects, while also exempting producers from real estate tax, stamp tax, and a number of administrative fees. Storage, transport, renewables, and desalination projects accommodating the green hydrogen plant will also be eligible for the tax breaks if the bill is approved. The draft law would enable green fuels developers to establish more than one subsidiary beyond their locally incorporated business to manage varying operations across the hydrogen value chain, the news outlet notes.

Who’s eligible for the tax breaks? Companies will need to have their projects up and running within five years and obtain at least 70% of their financing from foreign lenders. They will also be expected to source at least 20% of their inputs from local suppliers as part of the country’s initiative to reduce reliance on imports.

REMEMBER- Egypt is expected to release its hydrogen strategy soon: In September, Egypt completed drafting its national hydrogen strategy,which is currently under review by the country’s Supreme Council of Energy. The Egyptian government signed several framework agreements for green hydrogen projects during COP27, which are expected to have a combined USD 83 bn investment ticket and produce up to 7.6 mn tons of green ammonia annually from 2.7 mn tons of hydrogen, pending financing and regulations. Egypt is targeting 8% of the global hydrogen market by 2040.

WATCH THIS SPACE #2- UN is in talks to deliver plastic treaty next year: UN negotiators are in a third round of talks to reach an agreement on controlling plastic pollution by the end of 2024, Reuters reports. While major oil and petrochemical exporters — including Saudi Arabia and Russia — as well as the global plastic industry are advocating that the agreement should promote recycling and re-use of plastic, environmental groups on the other hand are pushing for a reduction in plastic production in parallel to recycling initiatives. Switzerland and Uruguay headed a proposal curbing harmful polymers and chemicals, which has been backed by more than 100 countries. Environmental group Greenpeace also called for the US and the EU to show more initiative for a successful agreement.

REMEMBER- Some want plastic polymers phased-out: Countries including Japan, Canada, and Kenya are lobbying for a treaty with “binding provisions” on the phaseout of virgin plastic polymers derived from petrochemicals, and other toxic plastics. The global output of plastic production currently totals some 400 mn tons annually, with 10% of the volume being recycled, exacerbating oceanic plastic pollution and overwhelming landfill capacity.

WATCH THIS SPACE #3- The EU is issuing 244 mn carbon permits next year: European governments will auction 244 mn EU carbon permits from mid-January until August 2024 under their Emissions Trading System (ETS), Reuters reports, citing a statement by the European Commission. The Commission will decide on the number of permits to be sold in the next round of auctions that will take place from September to December 2024 by July. Next year will see the bloc auction 97 mn permits for the Modernization Fund, 87 mn for the Recovery and Resilience Facility, and 35 mn for the Innovation Fund.

The EU has been working on setting effective carbon prices: The European Parliament approved sweeping reforms to carbon markets earlier this year cracking down on European countries’ access to free CO2 permits by 2034 and adding shipping emissions to the carbon market starting 2024. Some analysts have lowered price forecasts for EU carbon permits on expectations of lower demand to around EUR 84 per metric ton in 2024 and EUR 89 in 2025. However many experts point to the real cost of carbon being above USD 100 (c. EUR 91.5), higher than the EU’s current benchmark of EUR 85 per ton.

REMEMBER- The region is setting up some carbon markets of its own: Saudi's Regional Voluntary Carbon Market Company is planning to establish a carbon trading exchange early next year. Saudi also plans to issue a greenhouse gas scheme as well to allow firms to offset their emissions. The carbon credit market could see CO2 trading of 100-150 mn tons by the end of the decade.

DANGER ZONE- Top companies are contradicting their net zero lobbying activities: 58% of the world’s largest corporations are at risk of “net zero greenwash” due to their lobbying against climate action policies, according to a new report (pdf) by non-profit think tank InfluenceMap. The research assesses companies’ performance based on the UN High-Level Expert Group (HLEG) Integrity Matters guidance, which highlights the necessity of aligning policy engagement with net-zero commitments.

Who are the top greenwashing contenders? The think tank assessed 293 firms with net-zero targets from the Forbes 2k list. ExxonMobil, Stellantis, Chevron, and Repsol are among the 21.5% of companies that are at “significant risk” of net zero greenwash due to their lobbying efforts against climate-focused legislation and their support for fossil fuel expansions, the research notes. ExxonMobil — which has set a 2050 net-zero target — is lobbying for increased oil and gas drilling in the US and has opposed the country’s Environmental Protection Agency's proposal for fossil fuel power plant CO2 curbs, InfluenceMap said. Repsol lobbied the Spanish government to reverse its ban on oil and gas expansions, and automaker Stellantis contested the EU’s planned ban on combustion engine vehicles by 2035 in spite of its carbon neutrality target by 2038, the think tank notes.

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CIRCLE YOUR CALENDAR-

The UAE will host the World Green Economy Summit from Tuesday, 28 November through to Wednesday, 29 November in Dubai. The event will bring together green tech developers and policymakers to explore pathways to accelerate the transition to net-zero sources and meet the Paris-agreed 1.5 °C warming threshold.

The UAE will host the Abu Dhabi Finance Week (ADFW) from Monday, 27 November to Thursday, 30 November in Abu Dhabi. The event will gather government officials, banks, financial institutions, and VCs to delve into today’s most pressing economic, technological, and sustainability issues.

The UAE will host the Conference of the Parties (COP28) from Thursday, 30 November through to Tuesday, 12 December in Dubai. COP28 will be divided into Blue and Green zones with the former reserved for heads of states, government delegations, and UN bodies. The green zone — which will be open to the public — will serve as a central hub where developers, industry leaders, NGOs, and climate activists come together to explore pathways to accelerate the transition to clean energy. The zone will host over 300 talks tackling the climate crisis and showcase climate-focused interactive exhibits.

Oman will host its Green Hydrogen Summit from Tuesday 12, December through to Thursday, 14 December in Muscat. The two-day event will bring together green fuels developers, renewables companies, and policy makers in a bid to chart a course toward carbon-neutrality by 2050. Aside from the conference, the summit will also include masterclasses delving into the specifics of the green hydrogen value chain, from green electricity production to H2 production, distribution and storage. You can register for the event here.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

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