How MENA is on its way to becoming a green hydrogen hub

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WHAT WE’RE TRACKING TODAY

TODAY: The green subsidies debate rolls on

Good morning, friends. After a flurry of climate news and updates from our neck of the woods over the weekend, we have a much calmer morning today — but not without plenty of interesting reads and developments to keep our eyes on.

THE BIG CLIMATE STORY- Saudi Arabia, Oman, Egypt, and Morocco are currently the region’s leaders in the push towards green hydrogen, giving MENA massive potential to become a green hydrogen production hub. The four countries have taken substantial steps towards developing the clean energy source, but continue to face some country-specific challenges, according to research.

^^ We have chapter and verse on this in the news well below.

THE BIG CLIMATE STORY OUTSIDE THE REGION- France and Germany are set to weigh in on Europe-US green subsidies debate: France and Germany’s economy ministers will reiterate EU concerns about US President Joe Biden’s landmark climate bill — the Inflation Reduction Act (IRA) — and ask that no “aggressive” moves be made to tempt European companies to cross the Atlantic in search of subsidies, when they meet with White House officials today as part of a visit to Washington. Representatives of several US economic bodies have recently visited Europe promoting the incentives for US manufacture that form a key part of the USD 370 bn IRA package.

Germany’s Habeck is optimistic: German Economy Minister Robert Habeck sees the visit as a chance to explore ways for the “problematic” parts of the IRA to “perhaps be resolved,” he told Reuters. While the European Commission — which recently unveiled its proposal for a new plan to increase green industry investment in Europe — is taking the lead on resolving the trade dispute, he and Le Maire “want to lend support,” he added.

WATCH THIS SPACE #1- Abu Dhabi will track the emissions of vehicles on its roads: Abu Dhabi will use space technology to remotely monitor vehicle emissions on its roads in a three-week test carried out in six locations, Wam said in a statement. The Environment Agency Abu Dhabi will use patented technology from NASA that will detect and quantify on-road emissions from the tailpipes of moving vehicles using laser-based overhead detectors, the statement said. The technology will allow it to identify the vehicle’s license plate number to acquire information about the vehicle’s brand, model, fuel type and emission standards.

WATCH THIS SPACE #2- Abdul Latif Jameel-backed EV maker Rivian is developing an electric bike, CEO RJ Saringe told staff on Friday, unnamed sources from Rivian told Bloomberg.

What we know: Very few details have been revealed about the product, and officials declined to comment when asked by Blomberg. The company first expressed interest in micro mobility at an October conference, when Rivian’s CEO “hinted” at the company’s interest in developing an e-bike. The company has patents for bicycle designs and parts, but it remains unclear whether the company intends to produce an electric bicycle or motorcycle, reports Bloomberg.

WATCH THIS SPACE #3- Honda and General Motors will start producing a new hydrogen fuel cell system to power fuel cell EVs in 2023, Honda’s Senior Managing Executive Director Shinji Aoyama said, according to Reuters. The automaker plans to sell some 2k units of the system by 2025, and up to 60k units by 2030, according to the newswire. It also aims to use the hydrogen fuel cell tech for heavy duty trucks, construction machines, and stationary fuel cells, Aoyama is quoted as saying.

DATA POINT #1- At least 5% of cars on Jordan’s streets are electric vehicles, Mohamad Khawaja, head of energy engineering at the German Jordanian University, told SciDevNet. In Egypt, some 3% of EnterpriseAM and Enterprise Climate readers said they own EVs. Jordan was the first country in the region to import EVs back in 2015, Khawaja said, adding that nearly a decade later, battery warranties are nearing expiration and EV owners still lack awareness about the proper disposal of potentially toxic and flammable batteries, he added. This poses an issue that should be addressed in Jordan’s policies on EVs, which as they stand, do not provide clear guidance for disposal procedures, Khawaja said.

DATA POINT #2- Dubai reached more than 620 operational electric vehicle charging stations across the emirate by the end of 2022, helping to encourage low-carbon vehicle use, according to a Wam statement. The emirate currently has 1.5k EVs and 13.5k hybrid cars on its roads.

WORTH READING- The emissions gap between social classes within individual countries is now greater than that between countries: Higher-income classes account for a much larger share of individual countries’ emissions than lower classes, according to a report (pdf) from the World Inequality Lab. The report, which tracked carbon emissions data across different countries and regions, found that the correlation between higher wealth and higher carbon emissions is applicable both within individual countries and when comparing countries or regional clusters to each other. However, while the disparity in the volume of emissions between countries across the world is substantial, overall inequality in global emissions can be better explained and understood by looking at inequalities within individual countries, the report suggests.

What does this mean? Governments must address these inequalities through more equitable domestic tax systems that can redistribute some of the windfalls of rich companies into projects that can help boost these countries’ clean energy transition, the report argues.

THE DANGER ZONE- Single-use plastic waste hit an all-time high in 2021 — and is likely to continue rising for a few more years: Some 6 mn tons of single-use plastic production — around the same weight as the Great Pyramid of Giza — has been added to the global volume of plastic waste in 2021, Australia’s Minderoo Foundation revealed in its 2023 Plastic Waste Makers Index (pdf). This brings total waste from single-use plastic in 2021 to a record 139 mn tonnes, which the report predicts will rise by another 17 mn tonnes by 2027. “The plastic waste crisis is intensifying and is going to get significantly worse before we see an absolute year-on-year decline in virgin single-use plastic consumption,” the report says.

Spotlight on oil and gas: The vast majority of single-use plastics are produced by oil, gas and petrochemical industries, the report notes, adding that those industries have made “little progress” to tackle the problem and boost recycling efforts.

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HAPPENING TODAY-

The International Association for Energy Economics’ International Conference is on its fourth day in Riyadh, Saudi Arabia. The five-day event wraps on Thursday.

Also in Riyadh: The Saudi International Marine Exhibition and Conference is on its penultimate day.

Meanwhile in Egypt, the one-day Cairo Forum for Sustainable Maritime Transportation Funds kicks off in Cairo today.

CIRCLE YOUR CALENDAR-

Egypt will host the CSR Forum from 2-5 March at Somabay, Hurghada. The event aims to further discussions put forth during COP27 and boost private and public sector cooperation on climate action. You can register for the event here.

The Arabia CSR Awards is accepting applications until Friday, 30 June. The awardwinners will be announced during a ceremony on Wednesday, 4 October.

The first MENA Solar Conference is accepting applications from published researchers specialized in PV technology until Sunday, 30 April. The Dubai Electricity and Water Authority will be hosting the conference from 15 to 18 November, in conjunction with the Water, Energy, Technology, and Environment Exhibition and the Dubai Solar Show 2023. Researchers can submit their papers here.

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

Four countries are leading MENA’s green hydrogen development

How Morocco, KSA, Egypt, and Oman — MENA’s big green hydrogen players — are attracting investment and where bottlenecks remain: North Africa could become the top global producer of green hydrogen, aided by abundant solar and wind power, lots of uninhabited land, and its existing pipeline networks, US think tank Atlantic Council argued recently. MENA is often hailed as a potential green hydrogen hub, with Morocco, Egypt, KSA and Oman having the most advanced hydrogen strategies, according to a 2022 IRENA report (pdf). So what are these countries doing to attract investment and what could slow things down?

Morocco and KSA are among the most promising producers globally: Morocco and KSA are among five countries best placed to become major clean hydrogen producers by 2050, IRENA notes. Morocco could capture up to 4% of the global market for green hydrogen and its derivatives by 2030, according to Swiss foundation Green Hydrogen Organization (GHO).

Egypt is another potential hub: Africa could produce 50 mn tons of green hydrogen per year by 2035, by harnessing renewable energy from three hubs: Morocco and Mauritania, Egypt, and South Africa and Namibia, according to a recent report (pdf) supported by the European Investment Bank (EIB). By 2035, Egypt could produce 20 mn tons of green hydrogen per year, with 12.5 mn tons exported, while Mauritania could produce 12.5 mn tons of green hydrogen per year, with 7.5 mn tons exported, the report predicts.

All four countries are developing national hydrogen strategies:

Egypt: Egypt’s low-carbon hydrogen strategy, unveiled at COP27, should ultimately cover the whole hydrogen value chain — supply, demand, and infrastructure — though details have been scarce so far. In practice, the government has called for export-focused projects ahead of projects aimed at local energy offtakers.

Morocco: Morocco’s hydrogen roadmap (pdf), issued in 2021, focuses on market and demand (green hydrogen export and storage); technology (aiming at cost reduction and local industrial integration; and investment. In the short-term (2020-2030), it’s planning local use and export to targeted markets. Medium-term (2030-2040), it’s targeting lower production costs and possible usage in Morocco’s electricity sector. Long-term (2040-2050), green hydrogen could be used in residential heat production and mobility — including for heavy vehicles and aviation.

KSA: In 2022, KSA was developing a national hydrogen strategy, outlining its production, export and domestic uses. This included “essential aspects” of the production process for green and blue hydrogen, eyeing transportation of hydrogen for domestic use and its integration into products for export.

Oman: Oman’s strategy, announced in October, invites project developers to produce green hydrogen for export, convert it to ammonia or methanol, or use it to power “hard-to-abate” industries.

Major projects are in the pipeline: Egypt signed framework agreements for green hydrogen and ammonia plants worth USD 83 bn at COP27 last November. KSA is launching a USD 5 bn project in NEOM — potentially the world’s largest utility-scale green hydrogen facility, while Morocco recently received EUR 38 mn from Germany to finance its first plant, amid a flurry of private sector interest. Out of the USD 180 bn worth of regional projects that had been announced as of October 2022, USD 63.8 bn worth were in Egypt, USD 48.9 bn in Oman, USD 16.85 bn in Morocco, USD 10.5 bn in KSA, and USD 10.3 bn in the UAE.

And plans to spur investment, like upping renewables use and partnerships: Morocco is aiming for renewables to form a 52% share of its energy mix by 2030, 70% by 2040 and 80% by 2050. Egypt and Morocco are both members of the African Green Hydrogen Alliance, launched in May 2022 to encourage collaboration on everything from regulation to capacity building, financing and certification.

For GCC economies, blue hydrogen export has already begun: Saudi Aramco is earmarking “multiple bns of USD” to become a major blue hydrogen exporter and plans to begin selling blue ammonia to Asia by 2027. Having sold several test shipments of blue ammonia to Japan in 2021 the UAE sent its first low-carbon ammonia shipment to Europe in September.

They’re gearing up for green to follow: Oman aims to become a “large-scale exporter” of green hydrogen or green ammonia, the IRENA report notes. And South Korea plans to import green hydrogen from the UAE by 2027, its government announced in January.

Existing fossil fuel infrastructure could help: Countries that repurpose existing pipeline infrastructure designed for natgas and liquified petroleum gas to carry hydrogen will have a distinct advantage in the notoriously-challenging field of hydrogen transportation, notes Atlantic Council. Oman is already looking into this, we’ve noted previously.

But bottlenecks still need to be overcome to get this industry off the ground:

Water scarcity: Green hydrogen production is a water-intensive process. And because globally some 70% of planned electrolyzer projects are in water-stressed regions, over 85% of planned green hydrogen projects may need to use desalination — a fossil fuel-reliant process that increases production costs — to get fresh water for production, the IRENA report notes.

In-country infrastructure and energy trade routes — which impact supply and demand: Factors affecting a country’s ability to effectively produce green hydrogen include existing infrastructure (which determines the ease of transport by sea or pipeline), the cost of capital, access to key electrolyzer technology, supportive national and international policy frameworks, and its investment climate, the IRENA report notes. With many net importers now eyeing green hydrogen export, existing energy trade systems could also be in for a radical shake-up — meaning initial supply could well exceed global demand, it adds.

The cost of tech: Once green hydrogen production falls below USD 2/KG, it will be extremely cost competitive, the EIB report notes. But as of last year, green hydrogen cost some USD 5-6/KG to produce, while gray hydrogen cost less than USD 2/KG.

And certification for export to Europe: The need to prove the green credentials of any green hydrogen destined for Europe — by tracing and certifying that it was produced by new renewable energy sources — is likely to prove an impediment to export, at least in the short-term.

Volvo’s biogas truck can reduce CO2 emissions on long-haul transport

Volvo has launched a long-haul biogas truck that runs on renewable fuel and can reduce CO2 emissions by up to 100%, the company said in a statement. The Volvo FH and FM, which are powered by bio-liquefied natural gas (LNG), are 4% more fuel-efficient and have a gas tank with a capacity that is 10% larger than previous trucks.

The specs: The Volvo FH and FM have 500 horsepower, compared to previous trucks which had 420 and 460 horsepower, and have fuel tanks that are 10% bigger, giving them a range of up to 1k km. They can be fueled almost as fast as diesel trucks from a network of more than 600 stations for bio-LNG and LNG in Europe. The new models can be run on both bio-LNG and LNG, using a small diesel injection to ignite the gas.

What is biogas? Biogas, biomethane, or bio-LNG, is a renewable liquified biogas that is produced from organic waste. This includes food waste, manure, sludge from treatment plants and other residual products. It is increasingly being seen as a substitute for fossil fuel-based LNG. In order to be liquified, all LNG is cooled to -162°C so that it takes up less space for storage on vehicles.

The EU wants to increase biogas production 10-fold by 2030. The European Commission’s energy transition program, REPower EU, includes plans to shift from fossil fuel-based LNG to bio-LNG, with the target of producing 35 bn cubic meters by the end of the decade. The bloc has confirmed that 78 bio-LNG plants will be ready by next year.

Carbon captured in concrete by California startup

California-based startup Heirloom Carbon Technologies is using concrete to mineralize carbon in concrete, reports Reuters. Heirloom has partnered with Canadian concrete technology company CarbonCure to deliver c. 30 kg of CO2 collected from the San Francisco Bay area using direct air capture (DAC), the company reported in a press release.

So how does it work? Heirloom placed pre-heated and crushed limestone on large trays, which then absorbed CO2 over the course of three days. According to the company, limestone naturally absorbs CO2 from the atmosphere, and by heating it, the company catalyzed the absorption process. Concrete technology company CarbonCure then mixed the CO2 with concrete ingredients, strengthening the concrete and cutting the need for carbon-intensive cement. CarbonCure also conducted an experiment where it integrated leftover CO2 with water and used it for a new batch of concrete.

Why does it matter? Carbon, the most commonly used building material in the world, accounts for c. 8% of CO2 emissions globally. The technology used by CarbonCure cuts concrete-related emissions by c. 5%, with an additional 5-10% cut through its wastewater treatment process.

MENA needs to work especially hard to cut its building emissions. MENA’s CO2 output per ton of cement is 35% higher than the global average, World Cement Association CEO Ian Riley said last year, stressing that the region’s cement and construction industries need medium-term targets for 2030, and not just 2050 and 2060 net zero targets. He noted that adopting sustainable processes at cement plants, which will not require significant additional capex, coupled with sustainability policies, could potentially halve the region’s carbon footprint.

Dubai’s Taka Solutions launches cooling-as-a-service model + The UAE’s taxi fleet is going green by 2027

Dubai-based energy services company Taka Solutions launched a pay-per-use cooling service to cut carbon emissions and AED mns, according to a company statement released last week. The cooling-as-a-service (CaaS) model ensures better efficiency and reliability, and allows users to eliminate the cost of equipment, operational expenses, and liabilities by paying a pre-agreed charge. Taka signed its first CaaS project with Green Coast Real Estate for one of its residential projects, where it is projected to save over AED 2 mn in utility costs.

OTHER STORIES WORTH KNOWING ABOUT THIS MORNING-

The UAE is planning to transform its taxi fleet to be run entirely with hybrid, electric or hydrogen-powered vehicles by 2027, the Roads and Transport Authority announced. (Zawya)
Oman's Hydrom has extended the deadline for bid submissions for the Phase A Round 1 of its tender for green hydrogen projects in Duqm to Wednesday, 15 March. Two blocks will be awarded next April. (Statement)
Egypt received USD 3 mn-worth of grants from the UNDP in 2022 for its 30 GW/h, USD 13 mn Egypt-PV project. (Egyptian Cabinet statement)
Morocco established an intersectoral professional association for electric mobility last week to work on completing the standardization of electric mobility equipment, and to study the specifications for connecting charging facilities. (Archyde)

Dubai-based architecture firm URB is designing a 93 km long climate-controlled cycle, complete with vertical farms in Dubai. (Khaleej Times)

India’s green energy transition will cost USD 10 tn

India’s net-zero pledge for 2070 will require a USD 10 tn investment, the country’s secretary of power told Reuters, without disclosing the plans to mobilize the capital. The country is allocating USD 4.25 bn in 2023’s budget bolster the transition to renewables and low-carbon energy sources, meanwhile India’s top oil and gas producer Indian Oil Corporation (IOC) plans to invest over USD 25 bn to reach net-zero by 2046, as we noted in August. IOC is looking at using renewables to power its planned refining capacity expansion and is also setting up green hydrogen plants at some of its refineries.

It’s climate change, Jim, but not as we know it

Sick of feeling powerless in the face of climate doom and gloom? Try a climate-themed board game: The USD 11 bn board game and puzzle industry has started producing a new genre of climate-themed games, to meet the growing desire by the general public to engage on climate change — while keeping disaster fatigue to a minimum, the Guardian reports. High-profile climate-themed games to emerge recently include Daybreak — co-created by Pandemic designer Matt Leacock — which will see four players (representing the US, China, Europe and the “Majority World”) cooperate to reach net-zero. Other recent releases include Kyoto, where players operate as climate negotiators; Renature, which focuses on restoring a polluted valley; and Tipping Point, where players have to adapt cities to a warming climate.

MENA is producing its own game: UAE publishing company Cation Arts is developing its own game, One Earth, with Emirati clean energy firm Masdar partnering on content, Masdar revealed last year. One Earth will see players compete to build projects, set policies and develop technology to boost their nation’s prosperity — but the rising emissions that accompany these activities threaten all players, Cation Arts founder Mohamed Al Qadi explains. If emissions reach a certain level, everyone loses. “So this is exactly like real life,” Al Qadi adds. You can give the game a try on its Tabletop Simulator, support its crowdfunding campaign, or check in for updates on its release date.

CALENDAR

FEBRUARY 2023

5-7 February (Sunday-Tuesday) G20 Energy Transition Working Group Meeting, Bangalore, India.

4-9 February (Saturday-Thursday) International Association for Energy Economics’ International Conference, Riyadh, Saudi Arabia.

6-8 February (Monday-Wednesday): Saudi International Marine Exhibition and Conference, Riyadh, Saudi Arabia.

7 February (Tuesday): Cairo Forum for Sustainable Maritime Transportation Funds, Cairo, Egypt.

13-15 February (Monday-Wednesday): World Government Summit 2023, Madinat Jumeirah, Dubai, UAE.

21-23 February (Tuesday-Thursday): World Environment, Social and Governance (ESG) Summit, Dubai, UAE.

MARCH 2023

7-9 March (Tuesday-Thursday) Middle East Energy Exhibition, Dubai World Trade Center, Dubai, UAE.

15-19 March (Wednesday-Sunday): Qatar International Agricultural and Environmental Exhibition, Doha, Qatar.

22-24 March (Wednesday-Friday): UN 2023 Water Conference, New York, NY, United States.

APRIL 2023

6 April (Thursday): Arabia CSR Awards 2022 Clinic (online).

MAY 2023

1-4 May (Monday-Thursday): Arabian Travel Market, Dubai, UAE.

2-7 May (Tuesday-Sunday): Salon International de l’Agriculture au Maroc (SIAM), Meknes, Morocco.

16-18 May (Tuesday-Thursday): Seatrade Maritime Logistics Middle East, Dubai, UAE.

29-31 May (Monday-Wednesday): Electric Vehicle Innovation Summit, Abu Dhabi, UAE.

JUNE 2023

Bloomberg New Economy Gateway Africa Conference, Marrakesh, Morocco.

1-3 June (Thursday-Saturday): Envirotec and Energie Expo, Tunis, Tunisia.

13-14 June (Tuesday- Wednesday) The Arab Green Summit, Palazzo Versace Dubai, Dubai, UAE.

SEPTEMBER 2023

Chariot Limited and Total Eren’s feasibility study on a 10 GW green hydrogen plant in Mauritania to be completed.

OCTOBER 2023

2-4 October (Monday-Wednesday): WETEX and Dubai Solar Show, Dubai, UAE.

4 October (Wednesday): Arabia CSR Gala Awarding Ceremony, UAE.

NOVEMBER 2023

30 November - 12 December: Conference of the Parties (COP 28), Dubai, UAE.

EVENTS WITH NO SET DATE

End-2022

KSA’s Neom wants to tender three concrete water reservoir projects to up its water storage capacity by 6 mn liters.

2023

Early 2023: Egypt’s KarmSolar to launch KarmCharge, the company’s EV charging venture.

1Q2023: Oman will award two blocks of land for green hydrogen projects in Duqm, Oman.

Mid-2023: Sale of Sembcorp Energy India Limited to consortium of Omani investors to close.

Phase C of the 900-MW of the Mohammed bin Rashid Al Maktoum Solar Park in Dubai to be completed.

Saudi Basic Industries Corporation (Sabic) steam cracker furnace powered by renewable energy to come online.

4Q2023: Oman to award four blocks of land for green hydrogen projects in Thumrait, Oman.

2024

End-2024: Emirati Masdar’s 500 MW wind farm in Uzbekistan to begin commercial operations.

QatarEnergy’s industrial cities solar power project will start electricity production.

First 1.5 GW phase of Morocco’s Xlinks solar and wind energy project to be operational.

2025

Second 1.5 GW phase of Morocco’s Xlinks solar and wind energy project to be operational.

UAE to have over 1k EV charging stations installed.

2026

1Q 2026: QatarEnergy’s USD 1 bn blue ammonia plant to be completed.

End-2026: HSBC Bahrain to eliminate single-use PVC plastic cards.

Iraq’s Mass Group Holding wants to invest EUR 1 bn on its thermal plant Mintia in Romania to have 62% of run on renewable energy, while expanding its energy capacity to at least 1.29k MWh.

2027

MENA’s district cooling market is expected to reach USD 15 bn.

2030

UAE’s Abu Dhabi Commercial Bank (ADCB) wants to provide AED 35 bn in green financing.

UAE targets 14 GW in clean energy capacity.

Tunisia targets 30% of renewables in its energy mix.

Qatar wants to generate USD 17 bn from its circular economy, creating 9k-19k jobs.

Morocco’s Xlinks solar and wind energy project to generate 10.5 GW of energy.

2035

Qatar to capture up to 11 mn tons of CO2 annually.

2045

Qatar’s Public Works Authority’s (Ashghal) USD 1.5 bn sewage treatment facility to reach 600k cm/d capacity.

2060

Nigeria aims to achieve its net-zero emissions target.

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