Good morning, friends. The news cycle has picked up today with significant EV industry updates coming in from Egypt and the UAE. There’s also a world first in the ammonia shipping sector grabbing headlines, but first let’s head across the pond as major rumblings emerge from the White House…

THE BIG CLIMATE STORY OUTSIDE THE REGION- Biden hits Chinese EVs with 100% tariffs: The US has gone on the offensive in the brewing trade war with China by announcing a raft of tariff increases on USD 18 bn worth of Chinese imports that will each begin taking effect between 2024 and 2026. Tariffs on Chinese EVs will quadruple to 100%, those on lithium-ion EV batteries to more than triple to 25%, those on solar cells to double to 50%.

Biden’s tough talk seems to be directed to US voters in equal measure to China, warning the world’s factory yesterday that “when you make tactics like this, you’re not competing, it’s not competition, it’s cheating. And we’ve seen damage here in America” (watch, runtime: 22:30). The US is a minor market for Chinese EVs today.

The Chinese issued a sharp but vague response calling the move “political manipulation” ahead of the US election. “China will take resolute measures to safeguard its own rights and interests,” the Chinese Ministry of Commerce said in a statement yesterday. “The US should immediately correct its wrong actions and cancel the additional tariff measures against China.”

The story is grabbing headlines everywhere this morning: Reuters | AP | Bloomberg | The New York Times | The Wall Street Journal | The Financial Times | CNN | CNBC | The Guardian | BBC

WATCH THIS SPACE-

#1- Belgian consulting firm Elia Grid is set to complete a study on the costs and methods of connecting green hydrogen and other renewables to Egypt’s national grid, a source at Egypt’s Ministry of Electricity told Enterprise Climate. The final draft will take into account global pricing policies, production expectations, and the predicted cost of electricity production in the next five years. It is scheduled to be sent to the Egyptian Electricity Transmission Company (EETC) by the end of this month, government sources told Al Arabiya.

More details: The report assesses the implementation of up to 126 GW of renewable energy including 100 GW of green hydrogen and 26 GW of wind power, how to link them to the national grid, and provides the estimated technical and financial needs for connecting those projects, according to Al Arabiya. Egypt’s Electricity Ministry had already received an initial draft of study and has provided amendment suggestions in the technical, legal and financial issues.

The EETC is in on Egypt’s green hydrogen projects: The EETC will have a 7.5% share (or an equivalent fee) in Egypt’s hydrogen projects, according to signed MoUs that Al Arabiya reviewed.

Green hydrogen projects are expected to move forward in the coming period: Interest in green hydrogen projects was sparked once again in light of the recent devaluation and stabilization of the exchange rate, our source said, adding that foreign partners are predicted to bring their agreements into force in the coming period. Investments are expected to reach USD 29 bn in the medium term, up from the current USD 12 to 15 bn, they added, with investors set to receive 33-50% tax exemptions and a value-added tax exemption to incentivize hydrogen production.

REMEMBER- The study is critical for Egypt’s green certifications: Assurances electricity purchased from the state will be generated from renewable sources remains unclear, and remain critical with EU exports in sight. Ensuring that the electricity is renewable-sourced is still being determined, Hydrogen Egypt CEO Khaled Naguib told Enterprise Climate last year. “Developers are going to be looking for commitments from the government on what type of electricity will be used from the grid,” he said, “this is still an open discussion, because the grid and electricity will need to be certified [to be labeled green].” Other questions lingering include whether the existing grid will be used for the prospective green hydrogen projects or whether there will be a “dedicated grid” for the facilities, Naguib added.

#2- We have an update on Tanzania’s Julius Nyerere hydropower project: The Julius Nyerere Hydropower Plant And Dam in Tanzania — developed by Egyptian firms Arab Contractors and El Sewedy Electric — is nearly 98% complete, according to statement by the Egyptian Ministry of Housing, Utilities and Urban Communities. Major components like the main dam, turbines, intake works, and distribution station are already finished or nearing completion. This comes a few months after Tanzania’s Energy and Minerals Ministry recently connected the first of nine hydroelectric turbines for the 2.15 GW plant, which is located at the UN World Heritage site and has thus sparked concern from conservationists in the country.

Background: The Tanzanian government kicked off the first filling of the USD 2.9 bn project late in 2022, and after successful testing, the consortium achieved a rotating speed of 150 rpm with a 50 hertz frequency from operations on the first turbine, which had a capacity of 235 MW.

#3- Green economy challenges unpacked at Cairo’s Green Growth Summit: The Green Growth Summit, organized by Netherlands-based international cooperation organization Hivos, laid out the biggest trends and challenges in Egypt and the wider region’s green sector. Enterprise Climate attended the event, which gathered private sector players, financial institutions, investors, donors, and policymakers.

Tackling supply chain issues: To trigger a greening of the supply chain, parties from the input side of the chain all the way to the end users would benefit greatly from both regulation and finance to address the challenges faced in nascent sectors, industrial development expert at Unido Annachiara Scandone said. Having a greener supply chain would help increase competition, trade balance, climate resilience, and food and water security, she added.

Financing was a sticking point: The importance of scaling up and commercializing green tech faces challenges with unlocking finance, Changelabs Founder Karim Samra said. The banking sector needs more climate risk education and exposure to green portfolios in order to boost investment in early startups, he added. Offering differentiated financing — including revenue-based finance, subordinated debt, and working capital finance — is also advantageous, DisrupTech Ventures Managing Partner Mohamed Okasha added.

#4- EU cancels probe into Chinese bids for Romanian solar project: The EU said it will close probes into bids made by Chinese companies for a 110 MW Romanian solar park tender after the firms announced their withdrawal, Bloomberg reports. The Chinese bidders that withdrew included Longi Green Energy Technology, Shanghai Electric UK, and Shanghai Electric Hong Kong International Engineering. Longi submitted its bid through its German subsidiary. The investigation was launched by the European Commission (EC) in the beginning of April.

What was the EU investigating? The EU accused the Chinese firms of distorting the market in the public procurement procedure for the solar bid in Romania on the back of receiving foreign subsidies, according to an EC statement published last month. The Commission intended to assess whether the “economic operators concerned did benefit from an unfair advantage to win public contracts in the EU,” the statement explains.

The probe was made possible by the bloc’s new Foreign Subsidies Regulation: The European bloc launched the Foreign Subsidies Regulation (FSR) in January to help prevent “state-funded companies from abusing their financial muscle to fend off EU rivals,” the statement explains. The FSR applies to all economic activities in the EU, including M&As.

DANGER ZONE-

Climate change has adverse impacts on education: Climate change is predicted to impact education outcomes negatively as a result of increased school closures, disease, stress, and conflict, according to a World Bank (WB) report (pdf). During extreme weather events such as heat waves or flooding, schools close around 75% of the time and sometimes for prolonged periods when infrastructure is affected or evacuation is needed, the report found. Sudden temperature and rainfall change has shown to increase violence and conflict amongst students by 14% according to the report’s finding. These negative impacts translate into lower future earnings and productivity, especially for lower income students. Damages from tropical cyclones in the Philippines alone resulted in USD 4 bn in losses.

The increased risk of declining education due to climate change is still not on policymaker’s radar: 61% of policy makers in 28 low and middle income countries deemed climate adaptation in education as a least priority, despite the large threat that climate change poses for education, the report noted. The WB called for governments to increase adaptation measures in the education sector through education management, school infrastructure, student and teacher advocacy, and bolstering learning continuity.

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The goal: To provide an early, actionable roadmap for those who are “long Egypt.”

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CIRCLE YOUR CALENDAR-

Saudi Arabia will host the Saudi Energy Convention from Sunday, 19 May to Tuesday, 21 May in Riyadh. The convention will see energy and utilities industry leaders advance collaborative decarbonization efforts and identify innovation areas. It will also host the Saudi Utilities Convention and Saudi Hydrogen Convention to address the role and challenges of rolling out hydrogen, water and utility projects that are in line with the global energy transition. Over 10k energy professionals and 200 industry speakers will be present at the event.

The UAE will host The Electric Vehicle Innovation Summit from Monday, 20 May to Wednesday, 22 May in Abu Dhabi. The event will see industry leaders come together to discuss sustainable mobility and tapping into groundbreaking advancements in electric vehicles while engaging with key decision-makers.

Saudi Arabia will host the Future Aviation Forum from Monday, 20 May to Wednesday, 22 May in Riyadh. The event, organized by the General Authority of Civil Aviation, will see the Kingdom showcasing some USD 100 bn worth of investment options in the aviation and logistics sector at large.

The UAE will host the Bonds, Loans & Sukuk Middle East event from Tuesday, 4 June to Wednesday, 5 June in Dubai. Billed as the Middle East's largest corporate and investment banking event, it serves as a key meeting point for those active in the region's capital markets. Over 1.4k governments, corporates, investors, banks, law firms, regulators and service providers as well as more than 75 expert speakers will be in attendance.

Turkey will host the International Conference on European Energy Market, from Monday, 10 June to Wednesday, 12 June in Istanbul. The three-day event will gather experts from scientific, industry, and policy sectors for discussions on various energy market-related topics. The conference covers themes including energy modeling, market design, regulatory policies, and climate change.

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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