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Sonatrach signs MoU to conduct feasibility studies to join SoutH2 Corridor project

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WHAT WE’RE TRACKING TODAY

TODAY: Algeria wants in on the SoutH2 Corridor project

Good morning, ladies and gents. The news cycle is experiencing a mid-week lull, but we have the latest on Algeria’s interest to join the SoutH2 Corridor project along with a deep dive into the global outlook on renewable energy deployment meeting the target set by COP28. Shall we?

WATCH THIS SPACE-

#1- Test flights for the eVTOL aircrafts Saudi Airlines purchased from Germany’s Lilium are set for February 2025, a Saudi Airlines official spokesperson told Asharq Al-Awsat. The tests will be followed by training pilots and developing infrastructure until deliveries begin to trickle in by 2H 2026, spokesperson Abdullah Al-Shahrani said during the Global Logistics Forum in Riyadh. Delivery of the entire fleet will take over six years, Al-Shahrani added.

ICYMI- Saudi Airlines is getting 100 eVTOLs: The company finalized an agreement with Lilium in July to purchase 100 eVTOL aircraft. This transaction includes 50 confirmed orders and 50 optional ones, with the first deliveries expected in 4Q 2026.

A maintenance agreement is also in the works: Saudi Airlines is scheduled to sign a deal with Lilium’s customer service organization Lilium POWER-ON for aircraft fleet maintenance and other support services.

#2- Another wind energy breakthrough by Dongfang: China’s Dongfang Electric has developed a mega offshore wind turbine with a record-breaking capacity of 26 MW, surpassing the previous record of 18 MW, Bloomberg reports. The new turbine is 31% larger than its predecessor, and its blades span 310 meters in diameter. This development is part of a broader trend among turbine manufacturers to increase the size of offshore equipment, aiming to reduce costs by generating more power from fewer units. China’s CRRC also revealed last week its production of the largest floating offshore wind turbine, with a capacity of 20 MW.

The company is active in the region: Dongfang – which developed what was dubbed last summer as the world’s largest semi-direct drive offshore wind turbine – partnered with Saudi’s SEP Fab Plant last year to localize renewable energy technology.

KUDOS-

Forbes names Middle East’s 2024 Sustainability Leaders: Forbes has released its Middle East Sustainability Leaders 2024 list featuring leading individuals and companies. The UAE came out on top with 54 companies on the list, followed by Saudi Arabia and Egypt with 20 and 10 companies each. Qatar came fourth with eight companies, followed by Bahrain and Kuwait with five each, and three in Oman. The assessment criteria involved an analysis of sustainability and ESG reporting across the region, and looked at improvements in emission reductions, renewable energy and energy efficiency, and management of waste, water, and other resource.

Who made the list? The top spots from each sector included Masdar’s Mohamed Jameel Al Ramahi, Jasim Husain Thabet of Taqa Group, PIF’s Yasir Othman Al-Rumayyan, Aramco’s Amin H. Nasser, Neom’s Nadhmi Al-Nasr, and DP World’s Sultan Ahmed bin Sulayem.

DANGER ZONE-

Earth’s natural carbon sinks are under threat as temperatures rise: Last year’s hottest year recorded saw a significant breakdown in land carbon absorption due to increasing temperatures, droughts, and wildfires, The Guardian reports, citing new research (pdf). Ocean carbon uptake is also slowing as Arctic ice melts and temperatures rise, disrupting the ecosystem of carbon-capturing algae-eating marine organisms, such as zooplankton. The research warns that the possible collapse of natural carbon sinks is not factored into most climate models, raising the alarm that we could even see more accelerated global heating.

What does this mean for climate goals? Without nature’s ability to absorb carbon, achieving net-zero emissions becomes nearly impossible, the newspaper writes. At least 118 countries rely on natural sinks to meet their climate goals, and weakening these systems could accelerate global warming beyond current projections. Events like Canada’s recent wildfires – which released as much carbon as six months of US fossil emissions – are not factored into climate models, raising concerns about future predictions.

Urgent action is needed: “We shouldn’t rely on natural forests to do the job. We really, really have to tackle the big issue: fossil fuel emissions across all sectors,” Exeter University’s Professor Pierre Friedlingstein, who oversees the annual Global Carbon Budget calculations, told The Guardian.

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CIRCLE YOUR CALENDAR-

Egypt will host the World Urban Forum from Monday, 4 November to Friday, 8 November in Cairo. The forum, established by the UN and one of its largest non-legislative events, will center around the effect of rapid urbanization on communities, economies, climate change, and policies and will bring together government representatives, academics, business people, urban planners, and more.

South Africa will host the Critical Mineral Africa Summit from Wednesday, 6 November to Thursday, 7 November in Cape Town. The summit aims to attract critical minerals investment to the continent and will be held alongside African Energy Week. The summit will be held in partnership with the Southern African-German Chamber of Commerce Partners representing Germany’s increasing investments in southern Africa.

Azerbaijan will host the United Nations Climate Change Conference or Conference of theParties (COP29) from Monday, 11 November to Friday, 22 November in Baku. The annual conference brings together governments, world leaders, and other stakeholders to advance the Paris Agreement and negotiate ways to fight climate change. The United Nations Framework Convention on Climate Change’s objective is to “stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system”.

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

This publication is proudly sponsored by

Opening up a world of opportunity
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GREEN HYDROGEN

Sonatrach signs MoU to conduct feasibility studies to join SoutH2 Corridor project

SoutH2 Corridor feasibility studies are underway: Algeria’s state-owned Sonatrach signed an MoU with Germany’s VNG, Italy’s Snam and Sea Corridor, and Austria’s Verbund to conduct feasibility studies for the implementation of the SoutH2 Corridor pipeline, according to a press release (pdf). The parties are set to jointly study the green hydrogen value chain of green hydrogen if Algeria is included in the project as a hydrogen producer and exporter to Europe. No timeline or financial details were disclosed for the studies.

That’s not all: Sonatrach also signed an MoU with Mubadala-owned Spanish oil refiner Cepsa to jointly explore establishing a project to produce green hydrogen and its derivatives in Algeria, according to a press release (pdf). The two phases of the MoU include assessing the project’s viability in the first and then developing it in the second. No timeline or financial details were disclosed for this project as well.

We knew this was coming: Plans for the SoutH2 Corridor project MoU were announced last July by the companies after a meeting involving company executives that discussed the project’s goal to supply the EU with nearly four mn tons of green hydrogen annually from Algeria to Germany via Italy and Austria.

About the project: The SoutH2 Corridor is a 3.3k km hydrogen pipeline connecting North Africa, Italy, Austria, and Germany. The project is set to use over 70% repurposed infrastructure, with new pipeline segments only where necessary. The project’s website boasts governments’ “political endorsement” and “support” from companies involved in hydrogen production and offtake along the corridor.

Cepsa is also playing a role in Europe’s hydrogen network: The company signed agreements with Norwegian ammonia producer and shipper Yara Clean Ammonia and Dutch energy network operator Gasunie to facilitate transportation of green hydrogen to Germany and neighboring European countries last year. The agreement was to have the two parties establish a green hydrogen maritime corridor between the Spanish port of Algeciras, near Cepsa’s green hydrogen hub, and the Dutch port of Rotterdam.

REMEMBER- Major companies are planning to use the corridor: Saudi renewables giant Acwa Power signed an MoU with the Tunisian government in June to develop a USD 6.2 bn renewables-powered green hydrogen project capable of producing 200k tons of green hydrogen, which will be exported to Europe via the SoutH2 Corridor pipeline. TE H2 — a JV between French energy giant TotalEnergies and Luxembourg’s EREN Groupe — and Austrian utilities company Verbund also signed an agreement with Tunisia in May to study the production of 200k tons of green hydrogen for export annually using the pipeline.

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The Macro Picture

Renewables growth to exceed expectations, still to fall short of COP28 target to triple by 2030

Global renewable energy capacity is set to grow by 2.7x by 2030, falling short of COP28 targets to triple renewables by the end of the decade, according to a recently released International Energy Agency (IEA) report (pdf) which outlines the progress made on COP28 targets of tripling renewables and doubling energy efficiency and hydrogen by 2030. The projected 2.7x growth surpasses countries’ own 25% growth goals.

Solar PV is leading the charge: New solar capacity added up until 2030 will represent 80% renewable energy capacity growth globally. The energy source is gaining popularity due to decreasing costs, faster permit approvals, and social and political support, reinforcing its popularity among households and companies wanting to lower costs.

But PV investment might die down: An oversupply-induced price drop is expected by 2025 as global solar production reaches double the projected PV demand at over 1.1 TW. As a result, prices have more than halved since 1H 2023.

Wind to recover despite earlier woes: The global wind sector has been experiencing supply chain and financial issues but is expected to be on track to recover. Global policy changes, streamlining auctions and grid connections will likely make wind more attractive and see the industry double by 2030 compared to the period between 2017 and 2023, IEA finds.

Hydrogen and biofuels are struggling: Only 4% of renewables capacity in 2030 will be derived from clean hydrogen fuel. There needs to be more than increased policy support for the green fuel to offset the impact of projected insufficient demand creation, the report predicts. Renewable fuels — which the IEA deemed “essential to energy transitions” — are set to grow by only 20% while their share in energy demand will remain at less than 6% by 2030. The report highlights the urgent need for policy support to double the growth of renewable fuel if net zero is to be achieved.

What about other renewables? Hydropower’s growth is to remain steady, but bioenergy, geothermal, and concentrated solar power’s shares in the renewables growth are set to decline due to insufficient policy support.

Salvaging COP28 Pledges: In an accelerated transition scenario, the report says China, Europe, India, and the United States collectively could provide 80% of total installed capacity and put the world back on track to meet the tripling goal. Under this optimistic scenario, China will have addressed its grid challenges, solar PV systems will be installed faster, and EU and US governments will streamline permit processes and boost investments.

How did MENA fare? The region’s countries are expected to succeed in tripling their renewable capacity to around 150 GW, but would fall short of achieving its target to expand renewable capacity to 201 GW by 2030 due to “significant implementation challenges.” Saudi Arabia, Egypt, and Algeria would account for almost 60% of that capacity goal but are among those off track to meet their ambitious targets. UAE, Oman, and Morocco, however, are on track to hit their expansion targets.

What can be done to boost MENA’s performance? The entire region has the potential to push growth to 60% above projections by speeding up auctions, improving regulation and policy for solar PV that “allow self-consumption and introduce remuneration for excess electricity generation,” and developing industrial electrification while removing barriers to entry.

Solar PV is also leading the charge in MENA: Solar PV is set to account for over 85% of renewables expansion in MENA. The technology is attractive economically due to solar resources in the region, scalability, more accessible financing, and attractive cheaper-than-global-average bids.

Hydrogen was another driver of regional growth, accounting for 10% of growth capacity by 2030, which stands in contrast to the overall negative trends facing clean hydrogen growth elsewhere, like Europe.

China is coming out on top: China will be responsible for 60% of the growth. The country has gone beyond its 1.2k GW of solar PV and wind six years ahead of schedule with the help of eliminating feed-in tariffs in 2020, quadrupling solar PV, and doubling wind.

And expected to continue its reign: China is predicted to account for over 80% of global PV manufacturing capacity by 2030. The US and India’s renewable capacity is set to almost triple by 2030, but Chinese products will still cost about two to three times less, and China’s competitive advantage is projected to remain for the foreseeable future.

The EU, US, and India are also doing well: The EU and the US are on track to double renewable capacity growth between 2024 and 2030 on the back of competitive auctions and private power purchase agreements (PPA) and Inflation Reduction Act subsidies, respectively. The EU is close to achieving its 600 GW solar PV target for 2030 but is still falling behind on wind. In India, auctions and financial support have also helped renewables expansion, putting the country on track to be the fastest-growing renewable energy market amongst global large economies through 2030.

Developing countries have potential: Developing countries have high potential when it comes to renewables but struggle with high financing costs. On top of that, these economies tend to be put at a disadvantage with insufficient grid infrastructure. Policy support can help overcome these challenges by reducing risks associated with renewables investment, setting clear, reliable regulatory frameworks, and pushing for fossil fuel phaseouts.

More flexibility is needed in general: Several countries have struggled with grid capacity not keeping up with renewables deployment, forcing them to turn to curtailment. Wind and solar PV curtailment reached between 5 and 15% in Chile, Ireland, and the UK. Increasing battery storage and grid capacity will be necessary to address the issue. At present, there is at least 1.65 GW of renewable capacity that is nearing deployment readiness but awaiting grid access.

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STARTUP WATCH

Egypt’s e-scooter startup Rabbit Mobility closes USD 1.3 mn round

Rabbit Mobility closes USD 1.3 mn round: Egyptian e-scooter startup Rabbit Mobility raised USD 1.3 mn in a new investment round led by VC firm 500 Global and Untapped Global, according to a press release (pdf). The round also saw participation from a group of angel investors and sustainable mobility experts.

About the scooters: Rabbit’s recently deployed Gen 2 scooters are locally assembled in Egypt and have swappable batteries that average 29 days of use, cofounder and CEO Kamal ElSoueni told EnterpriseAM.

Where is the money going? The funds will “fuel Rabbit’s rapid growth and expansion plans across Egypt and other North African markets,” according to the press release. The funds will also help the company expand its fleet of electric vehicles, enhance user experience, and make micromobility more accessible locally.

Rabbit is heading to Morocco: Rabbit plans to deploy its first fleet of light EVs in Morocco next year, ElSoueni told us. “We’re interested in expanding to other North African markets starting with Morocco. We believe the Moroccan market is similar to the Egyptian market where cities have high population densities, high traffic congestions, and are not exposed to severe weather,” he said.

Rabbit Mobility? Rabbit Mobility is a cleantech transport company and a micromobility platform that offers day rentals of its fleet of electric vehicles — scooters, bikes, and others. Since it kicked off operations in 2019, the startup saw over 450k users complete over 1 mn rides. The startup expects to achieve profitability by year end.

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CLIMATE DIPLOMACY

KSA + the Philippines sign MoU to boost energy cooperation

Saudi, Philippines to cooperate on energy: Saudi Arabia and the Philippines inked an agreement to enhance cooperation in the energy sector, with a focus on renewable energy and energy efficiency, SPA reports. The agreement also includes collaboration in carbon capture and circular economy technologies aimed at reducing climate change impacts. The MoU also highlights opportunities for cooperation in other fields, including oil, digital transformation, innovation, cybersecurity, and artificial intelligence.

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ALSO ON OUR RADAR

Qatar boosts recycling sector through private tenders

RECYCLING-

Qatar taps private sector to boost recycling: Qatar’s Ministry of Municipality has awarded several tenders to private companies to boost waste management, treatment, and recycling in the Al Ajfa recycling hub in Mesaieed, The Peninsula Qatar reports.

What we know: The tenders awarded include one to operate a waste treatment center to recycle 2.3k tons of waste daily, another to develop a new landfill using sustainable technologies, and four waste transfer stations to transport waste to Mesaieed.

OTHER STORIES WORTH KNOWING ABOUT THIS MORNING-

  • FDO + AquaBioTech partner on aquaculture: Fisheries Development Oman(FDO) and Malta’s AquaBioTech signed an advisory contract to advance Oman’s sustainable aquaculture and fisheries sectors. AquaBioTech will provide strategic business development and technical due diligence services to FDO, which is backed by a USD 1.2 bn investment from the Omani government. (Statement)
  • UAEV and RAKTA partner to boost EV infrastructure in Ras Al Khaimah: UAEV – a JV between the UAE Ministry of Energy and Etihad Water and Electricity – inked an agreement with Ras Al Khaimah Transport Authority (RAKTA) to install and operate EV charging stations across the emirate. The initiative aims to promote sustainability, reduce carbon emissions, and advance economic growth. UAEV set a target to install 100 chargers in 2024 and 1k chargers by 2030 across the UAE. (Statement)
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AROUND THE WORLD

China sees its carbon prices surge ahead of compliance deadline

China’s carbon prices surged to a record CNY 103.49 (USD 14.62) per ton as industries face an impending compliance deadline next year, Bloomberg reports, citing the National Carbon Trading Agency. The recent 2.5% hike brings the prices to a total of 35% increase since the new rules were announced earlier this year.

REFRESHER- The new regulations require that power utilities secure sufficient emissions permits by year-end to cover their 2023 emissions, leading to concerns over a supply shortfall. They also expand the carbon market to include steel, cement, and aluminum, requiring around 1,500 industrial enterprises to buy carbon emission allowances (CEAs) to cover CO2 emissions from fossil fuel consumption. However, the initial phase from 2024 to 2026 will allow big amounts of gratuitous credits which could limit market participation.

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ON YOUR WAY OUT

Unprecedented rainfall partially floods the Sahara desert in Morocco

Unprecedented rainfall last month in southeastern Morocco led to flooding in the Sahara desert for the first times in decades, CBS reports. Considered one of the driest regions in the world, the area experienced more rain in two days than it typically sees in a year. In Tagounite, over 3.9 inches of rain fell in just 24 hours, contrasting the usual annual average of less than 10 inches. The heavy rains filled Lake Iriqui, which had been dry for 50 years.

Respite for drought-plagued Morocco: This rainfall is particularly significant for Morocco, which has faced six consecutive years of drought, forcing farmers to abandon fields and communities to ration water. The recent rains have begun to refill groundwater aquifers and reservoirs, offering a glimmer of hope for the drought-stricken region.

Better times ahead? “It’s been 30 to 50 years since we’ve had this much rain in such a short space of time,” an official from Morocco’s General Directorate of Meteorology told CBS. The rainfall may signal a shift in the weather patterns. Increased moisture in the air could lead to more frequent storms in the future, the official added.

It wasn’t without consequences: More than 20 people lost their lives in Morocco and Algeria, and the floods damaged crops, prompting the government to allocate emergency relief funds. Despite the immediate benefits of the rainfall, it remains uncertain if it will alleviate the conditions created by long-term drought.


OCTOBER 2024

13-17 October (Sunday-Thursday): Cairo Water Week, Cairo, Egypt.

15-16 October (Tuesday-Wednesday): Solar & Storage Live KSA, Riyadh, Saudi Arabia.

16-17 October (Wednesday-Thursday): Upscaling Investment on Small-Scale Renewable Energy in Rural Areas Forum, Tunis, Tunisia

17-19 October (Thursday-Saturday): Africa Solutions Week 2024, Rabat, Morocco.

25-27 October (Friday-Sunday): Al Sidr Environmental Film Festival, Abu Dhabi, UAE.

NOVEMBER 2024

4-7 November (Monday-Thursday): Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC), Abu Dhabi, UAE.

4-8 November (Monday-Friday): World Urban Forum, Cairo, Egypt.

4-8 November (Monday-Friday): AfricanEnergy Week, Cape Town, South Africa.

6-7 November (Wednesday-Thursday): Renewable Energy Forum Africa, Tunis, Tunisia.

6-7 November (Wednesday-Thursday): Critical Mineral Africa Summit, Cape Town, South Africa.

11-22 November (Monday-Friday): United Nations Climate Change Conference or Conference of the Parties (COP29), Baku, Azerbaijan.

11-14 November (Monday-Thursday): Abu Dhabi International Petroleum Exhibition & Conference, Abu Dhabi, UAE.

18-19 November (Monday-Tuesday): G20 Summit, Rio de Janeiro, Brazil.

19-22 November (Tuesday-Friday) Aquaculture Africa 2024, Hammamet, Tunisia.

26- 27 November: (Tuesday – Wednesday): World Food Security Summit, Abu Dhabi, UAE.

26-28 November (Tuesday-Thursday): Future Power Expo, Riyadh, Saudi Arabia.

26-28 November (Tuesday-Thursday): Egypt Energy Show, Cairo, Egypt.

27-28 November (Wednesday-Thursday): RAK Energy Summit, Ras Al Khaimah, UAE.

DECEMBER 2024

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nation Convention to Combat Desertification, Riyadh, Saudi Arabia.

3-4 December (Tuesday-Wednesday): MSGBC Oil, Gas & Power 2024 conference, Dakar, Senegal.

3-5 December (Tuesday-Thursday): World Energy storage Conference, Doha, Qatar.

4-6 December (Wednesday-Friday): International Conference on Smart Power & Internet Energy Systems, Abu Dhabi, UAE.

10-12 December (Tuesday to Thursday): International Mangrove Conservation and Restoration Conference, Abu Dhabi, UAE.

16-18 December (Monday-Wednesday): Saudi Arabia Smart Grid Conference, Riyadh, Saudi Arabia.

22-24 December (Sunday-Tuesday): Renewable & Sustainable Energies And Green Processes Conference, Sousse, Tunisia.

JANUARY 2025

12-15 January (Sunday-Wednesday): World Renewable Energy Congress, Manama, Bahrain.

14-16 January (Tuesday-Thursday): World Energy Summit, Abu Dhabi, UAE.

15-16 January (Wednesday-Thursday): Future Minerals Forum, Riyadh, Saudi Arabia.

18-19 January (Saturday-Sunday): Libya Energy & Economic Summit, Tripoli, Libya.

28-29 January (Tuesday-Wednesday): Sustainability Forum Middle East, Riyadh, Saudi Arabia.

FEBRUARY 2025

17-19 February (Monday-Wednesday): Egypt Energy Show, Cairo, Egypt.

23-25 February (Sunday- Tuesday): Global Water Energy and Climate Change Congress, Manama, Bahrain.

24-26 February (Monday-Wednesday): Connecting Hydrogen MENA, Dubai, UAE.

24-27 February (Monday-Thursday): Oman Climate Week, Muscat, Oman.

JUNE 2025

17-20 June (Tuesday-Friday): Mediterranean Water, Irrigation and Photovoltaic Exhibition, Tunisia.

EVENTS WITH NO SET DATE

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.

November: Arab Forum for Renewable Energy and Energy Efficiency, Amman, Jordan.

2025

International Union for Conservation of Nature World Conservation Congress, Abu Dhabi, UAE.

UAE to have over 1k EV charging stations installed.

Middle East Electric Vehicle Show, Sharjah, UAE.

2026

26-29 October (Monday-Thursday): World Energy Congress, Riyadh, Saudi Arabia.

UITP Global Public Transport Summit, Dubai, UAE.

Annual Meetings of the World Bank and the International Monetary Fund, Bangkok, Thailand.

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

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

2027

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

World Water Forum, Riyadh, Saudi Arabia.

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.

2050

Tunisia’s carbon neutrality target.

2060

Nigeria aims to achieve its net-zero emissions target.

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