Essar enters pact with Brazil's Vale Intl for Saudi Arabi green steel project

Posted By: Preeti Dabar Posted On: Sep 07, 2023
Essar is looking at investing about $4.5 billion in setting up an integrated steel plant in Ras Al Khair, Saudi Arabia. (File Photo)

Mumbai: The Essar Group, founded by the Ruia brothers, on Thursday signed a deal with Brazilian mining company Vale International to supply iron ore agglomerates for Essar's Green Steel Arabia (GSA) project.

“Essar is looking at investing about $4.5 billion in setting up an integrated steel plant in Ras Al Khair, Saudi Arabia," said Naushad Ansari, country head, Essar Group, in Saudi Arabia. “Through this letter of intent with Vale, and the previous LoI with Bahrain Steel, we will have secured 100% of the raw material supply of iron ore feed for the Saudi Steel Plant."

The plant will likely start production in 2027.

Ansari said Essar is confident of replacing the flat steel imports into Saudi Arabia and the GCC region with its bouquet of products.

As per the terms of the agreement, Vale will supply Essar with 4 million tonne per annum (mtpa) of DR grade pellets and briquettes.

Andre Figueiredo, Vale's regional director, emphasized that the LoI represents the company's long-term commitment to support the growing demand for raw materials in the steel sector. Figueiredo also noted that Vale's high-grade iron ore products would offer advantages such as price competitiveness and a potential reduction in carbon footprint, particularly in the Middle East.

Figueiredo believes this could prompt the growth of the low CO2 emission steel industry.

According to an Essar press release, the GSA project aims to be the region's first green steel initiative, setting global standards in CO2 emission reduction. The release outlined the project's planned capacities: 5.0 mtpa for direct reduced iron (DRI), 4.0 mtpa for hot strip, and 1.0 million tonnes for cold rolling, along with galvanizing and tin plate lines.

Source: Live Mint
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After Saudi Arabia

Posted By: Pawan George Posted On: Sep 15, 2023
United Arab Emirates has evinced interest in having grid connectivity with India. (File Photo: Bloomberg)

New Delhi: Days after India signed an energy agreement with Saudi Arabia, Union minister for new and renewable energy (MNRE) R.K. Singh on Friday said that the United Arab Emirates (UAE) has also evinced interest in having grid connectivity with India.

On 10 September, India and Saudi Arabia signed a Memorandum of Understanding on cooperation in the field of energy, which also included cooperation in grid connectivity.

Singh said that connecting India's power grid with that of Saudi Arabia and the UAE would help India supply power to Europe as the European grid would also be connected to the grid in the West Asian region.

The minister said that the energy pact would encourage cooperation in the field of renewable energy, green hydrogen, good ammonia, among others. He said that finance from Saudi funds may be cheaper for India projects and the pact would also help Indian green energy companies to set up plants in Saudi Arabia.

The pact would help boost bilateral investment in the field of hydrogen and storage, and oil and gas, according to a statement released on 11 September. Carbon capture, utilization and storage were also covered under the MoU.

Both the countries would also cooperate in promoting digital transformation, innovation and cyber-security and artificial intelligence in the field of energy and develop qualitative partnerships to localize materials, products and services related to all sectors of energy, supply chains and its technologies.

"The MoU will develop a stronger partnership between India and Saudi Arabia in the field of energy. The MoU will support India's efforts for energy transition and transformation of global energy system towards combating climate change," the statement had said.

Source: Live Mint
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The Gulf’s boundless ambition to change the world

Posted By: Aditya Gogoi Posted On: Sep 09, 2023
The Gulf economies are among the richest and most vibrant on the planet, helped by a Brent crude oil price that rose back to over $90 per barrel this week. (File Photo: AFP)

If you thought the Middle East was stagnant, think again. The Gulf economies are among the richest and most vibrant on the planet, helped by a Brent crude oil price that rose back to over $90 per barrel this week. A $3.5trn fossil-fuel bonanza is being spent on everything from home-grown artificial intelligence models and shiny new cities in the desert, to filling the coffers of giant sovereign-wealth funds that roam the world’s capital markets looking for deals.

As the cash flows in, the chaos shows signs of receding, thanks to the biggest burst of diplomacy for decades. Saudi Arabia and Iran have negotiated detente in a rivalry that has lasted since the Iranian revolution in 1979. Civil wars in Syria and Yemen are killing fewer people, as their sponsors seek de-escalation. Following the Abraham accords between Israel and some Arab governments, Saudi Arabia is considering recognising the Jewish state, 75 years after its creation. The region's global clout is rising—four countries are about to join the brics club of non-aligned powers that want a less Western-dominated world.

As our Briefing explains, these shifts begin a new chapter in the Middle East marked by fresh opportunities and new dangers. The region's leaders are testing ideas that have caught on in much of the world, including embracing autocratic pragmatism as a substitute for democracy, and multipolar diplomacy instead of the post-1945 American-led order. The Middle East is also a place where threats that will menace the world in the 2030s may play out early, including nuclear proliferation, extreme weather and even greater inequality, as weak countries fall further behind.

Many occupants of the White House have left office wishing they could forget all about the Middle East. But whether you run a superpower or a small business, it matters as much as ever. Although it has only 6% of the world's people, it has a chokehold on the global economy. As the lowest-cost oil producer, its share of crude exports is 46% and rising. Its share of exports of liquefied natural gas, in great demand since Russia's pipelines to Europe shut down, is 30% and going up, too. Thanks to its location, 30% of all container trade and 16% of air cargo passes through the region. With $3trn of assets, its sovereign-wealth funds are among the world's largest. Its wars and disorder often spill across borders; its refugees affect politics as far away as Europe.

The past two decades have been miserable in the Middle East. Democratic projects ended in failure and bloodshed, in Iraq after the American-led invasion of 2003 and in several countries after the Arab spring in 2011. Islamic State sought to kill its way to creating a caliphate, while in Syria Bashar al-Assad doused his own people in chlorine and nerve agents.

Yet now, as the fighting ebbs, three big changes are visible. First, the region is having to take more responsibility for its own security, as America's appetite to intervene militarily has evaporated. Alongside this, trade patterns have become multipolar: the imf reckons 26% of Middle Eastern goods exports go to China and India, almost double the level in 2000 and roughly twice the share headed for America and Europe. Recently, this geopolitical realignment has led to a desire to de-escalate conflicts.

Second, the energy transition creates an urgent need to escape the familiar pattern of oil booms and busts. Instead there is a powerful incentive for the Gulf to lift fossil-fuel production in the next decade before demand dwindles permanently, and spend the proceeds on diversifying local economies.

The final shift is a weariness in public opinion. Political experiments, whether democratic or Islamist, are tarnished. Instead, people across the Middle East yearn for economic opportunity. Forget Canada or Sweden: polls show the country young Arabs admire most is the uae, with its stability and thriving economy under iron-fisted dynastic rule. At the same time, less Western involvement in security and trade also means less pressure for human rights or democracy.

Some of the region's changes invite ridicule—think of a vanity project like neom, a gaudy new city being built for an estimated $500bn by Muhammad bin Salman, Saudi Arabia's de facto ruler. But other changes are durable and profound. More women are working in the Gulf. Israeli tourists are thronging to Dubai. Across the region, the non-oil economy is growing at a healthy annual rate of 4% and cross-border multinational investment is rising. It is possible to imagine how a virtuous cycle of stability and peace might lead to more investment and trade that raises living standards and broadens prosperity, reversing a long-lasting spiral of failure in a part of the world with some 500m people.

Yet to achieve that, the Middle East will have to overcome some big problems. Many of these are familiar. The region's more enlightened autocrats argue that they face a kind of “performance accountability" to improve the lot of their populations. But regimes with absolute rule tend towards decay. Other dangers are new—or, rather, looming more menacingly than ever. Now that Iran is on the threshold of becoming a nuclear-armed state, proliferation is a grave worry. Climate change means that one of the world's hottest, driest places faces even more extreme weather. Only some countries can afford the investments, such as redesigned cities and desalination projects, that they need to remain habitable.

80:20 rule

Most starkly, the new Middle East is more lopsided than in recent memory. The success stories, the Gulf and Israel, account for only 14% of the population but 60% of gdp, 73% of goods exports and 75% of inward multinational investment. From Israel and the West Bank to Saudi Arabia and Yemen, modern economies border places trapped in despair. Lebanon is mired in financial crisis; Egypt could be heading the same way. The new Middle East's winners embody a transactional mindset that may yet make them richer. Its losers are a reminder that in a world with fewer rules and principles, no one is coming to the rescue. As you fill up your car or wait for your air-freighted parcel, remember they depend on a region that is an economic and political laboratory—and hope the experiment does not blow up.

© 2023, The Economist Newspaper Limited. All rights reserved.

From The Economist, published under licence. The original content can be found on www.economist.com

Source: Live Mint
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Avaada to set up green hydrogen plant at Tata's Gopalpur Industrial Park

Posted By: Ramesh Sharma Posted On: Sep 07, 2023
The green hydrogen space in India has gained momentum after the government rolled out the national green hydrogen mission earlier this year. (Photo: Bloomberg)

New Delhi: Renewable energy company Avaada Group on Thursday announced setting up a green hydrogen and ammonia manufacturing unit at Gopalpur Industrial Park of Tata Steel SEZ Ltd in Odisha.

The announcement follows Avaada's signing of a memorandum of understanding (MoU) with Tata Steel Special Economic Zone Ltd (TSSEZL).

Earlier, TSSEZL had signed an MoU with ACME Clean Energy.

"The MoU is a crucial milestone in our journey towards the fruition of our green ammonia venture," said Vineet Mittal, chairman, Avaada Group.

The project is slated to generate around 1,600 direct and 4,000 indirect job opportunities, a company statement said, and will aim to curtail annual carbon dioxide emissions by nearly 2 million tonne.

The green hydrogen space in the country has gained momentum after the government rolled out the national green hydrogen mission earlier this year.

The renewable energy group has set ambitious targets to achieve 11GW of operational projects by 2026 and 30GW by 2030.

It has an operational renewable energy capacity of 4GW, and 3GW under construction. Apart from investing in solar and wind energy projects and green hydrogen projects, the company has ventured into solar module manufacturing, as well as manufacturing of electrolyzers.

Mint recently reported that the company is set to expand its workforce by nearly 3,000 employees in the next two years. At present, Avaada employs nearly 700 people. The expansion is aligned with its increasing activities in solar module manufacturing as well as green hydrogen operations.

In June, the company secured the largest funding in India's renewable energy sector worth $1.3 billion. While Brookfield Global Transition Fund invested $1 billion, existing shareholder Global Power Synergy Public Co. raised its stake in Avaada Energy Pvt Ltd through an infusion of $233 million.

Source: Live Mint
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Roberto Mancini Looks to Get Saudi Arabian Job Off to Positive Start in International Friendlies

Posted By: Preeti Dabar Posted On: Sep 06, 2023

Roberto Mancini will this week start his bid to make Saudi Arabia's national team as much of an international discussion topic as its big-spending professional league.

Just two years after leading Italy to the European title, Mancini left Rome for Riyadh in August.

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His first game in charge of the Saudi team is Friday against Costa Rica at the home of Newcastle United, the English Premier League club owned by Saudi Arabia's Public Investment Fund.

That organization is also funding the arrival of top-class talents such as Cristiano Ronaldo, Karim Benzema and Neymar to Saudi clubs in Riyadh and Jeddah.

“I believe this is a great opportunity for me to experience football in a new country, especially with the growing popularity of football in Asia,” Mancini, who has signed a four-year contract, said. “The presence of top players in the Saudi Pro League indicates the potential for growth in the national football scene.”

While the headlines have been on the famous imports, there is homegrown talent in the country. Saudi Arabia's shocking win over eventual champion Argentina last year was one of the biggest upsets ever at the World Cup. But the team has not played since coach Herve Renard left in March to take over the women's national team of France.

As well as the start of preparations for January's Asian Cup, which Saudi Arabia hasn't won since 1996, Mancini also has the start of qualification for the 2026 World Cup in November.

The same is true of another Inter Milan alumni on Thursday as Jurgen Klinsmann's South Korea takes on Wales in Cardiff, five days before the Koreans meet Saudi Arabia in Newcastle.

Klinsmann, the former coach of the Germany and the U. S. teams, has failed to win any of the four games South Korea has played — all at home — since he took over February.

There has also been criticism expressed in the Korean media with reports that the 1990 World Cup winner has spent just 67 days in the country in the six months since his appointment.

In August, he held a news conference via zoom from his Los Angeles home.

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“Maybe it's something new to people that are used to doing it differently. I don't blame anybody when they say, ‘Where is he?'” Klinsmann told reporters, adding that the work of a national team coach is international. “I am a workaholic. I love to work like Koreans love to work. If I'm not maybe 24/7 in the country, I still work 24/7.”

Japan is Asia's highest-ranked team at No. 20 and takes on Germany in Wolfsburg on Saturday, less than eight months after defeating the European team at the World Cup. There is also a game against Turkey in Belgium on Tuesday, with English Premier League stars Kaoru Mitoma of Brighton and Hove Albion and Liverpool's Wataru Endo featuring.

“We'll be out to figure out where we stand now by playing these teams with strength,” Japan coach Hajime Moriyasu said. “We hope to share and broaden our tactics ahead of the second round of World Cup qualifiers and the Asian Cup."

Source: News18
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Oil Prices Surge as Saudi Arabia and Russia Extend Global Production Cut Published 1 hour ago

Posted By: Pawan George Posted On: Sep 06, 2023

Saudi Arabia and Russia agreed Tuesday to extend their voluntary oil production cuts through the end of this year, trimming 1.3 million barrels of crude out of the global market and boosting energy prices. The dual announcements from Riyadh and Moscow pushed benchmark Brent crude above $90 a barrel in trading Tuesday afternoon, a price unseen in the market since November.

The countries' moves could increase inflation and the cost for motorists at gasoline pumps. It also puts new pressure on Saudi Arabia's relationship with the United States, as President Joe Biden last year warned the kingdom there would be unspecified “consequences” for partnering with Russia on cuts as Moscow wages war on Ukraine.

Saudi Arabia's announcement, carried by the state-run Saudi Press Agency, said the country still would monitor the market and could take further action if necessary. “This additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets,” the Saudi Press Agency report said, citing an unnamed Energy Ministry official.

State-run Russian news agency Tass quoted Alexander Novak, Russia's deputy prime minister and former energy minister, as saying Moscow would continue its 300,000 barrel a day cut. The decision “is aimed at strengthening the precautionary measures taken by OPEC+ countries in order to maintain stability and balance of oil markets,” Novak said.

Benchmark Brent crude traded Tuesday above $90 a barrel after the announcement. Brent had largely hovered between $75 and $85 a barrel since last October. A barrel of West Texas Intermediate, a benchmark for America, traded around $87 a barrel.

White House national security adviser Jake Sullivan declined to comment on the market impact of the decision, though he said U.S. officials had regular contact with the kingdom. He added that Biden would look to utilize “everything within his toolkit” to assist American consumers.

“The thing that we ultimately stand for is a stable, effective supply of energy to global markets, so that we can in fact deliver relief to consumers at the pump, and we do this in a way that is consistent with the energy transition over time,” Sullivan said.

Bob McNally, the founder and president of the Washington-based Rapidan Energy Group and a former White House energy adviser, said Saudi Arabia and Russia had “demonstrated their unity and resolve to proactively manage" the risk of oil prices potentially dropping in tougher economic conditions with their announcement Tuesday.

“Barring a sharp economic downturn, these supply cuts will drive deep deficits into global oil balances and should propel crude oil prices well above $90 per barrel,” McNally said.

The average gallon of regular unleaded gasoline in the U.S. stands at $3.81, according to AAA, just under the all-time high for Labor Day of $3.83 in 2012. However, gasoline demand typically drops for U.S. motorists after the holiday so it remains unclear what immediate effect this could have on the American market, AAA spokesman Andrew Gross said.

“I'm more concerned about what the rest of hurricane season may hold,” Gross told The Associated Press. “A big storm along the Gulf coast could move prices dramatically here.”

Hurricane Idalia just plowed through Florida and U.S. forecasters said Tuesday that Tropical Storm Lee in the Atlantic Ocean will become an “extremely dangerous” hurricane by Friday. Meanwhile, higher gasoline prices can increase transportation costs and ultimately push the prices of goods even higher at a time when the U.S. and much of the world is already raising interest rates to combat inflation.

“The impact these cuts will have on inflation and economic policy in the West is hard to predict, but higher oil prices will only increase the likelihood of more fiscal tightening, especially in the U.S., to curtail inflation,” said Jorge Leon, a senior vice president at Rystad Energy.

The Saudi reduction, which began in July, comes as the other OPEC+ producers have agreed to extend earlier production cuts through next year.

A series of production cuts over the past year has failed to substantially boost prices amid weakened demand from China and tighter monetary policy aimed at combating inflation. But with international travel back up to nearly pre-pandemic levels, the demand for oil likely will continue to rise.

The Saudis are particularly keen to boost oil prices in order to fund Vision 2030, an ambitious plan to overhaul the kingdom's economy, reduce its dependence on oil and to create jobs for a young population. The plan includes several massive infrastructure projects, including the construction of a futuristic $500 billion city called Neom.

But Saudi Arabia also has to manage its relationship with Washington. Biden campaigned on a promise of making the kingdom's powerful Crown Prince Mohammed bin Salman a “pariah” over the 2018 killing of Washington Post columnist Jamal Khashoggi.

In recent months, tensions eased slightly as Biden's administration sought a deal with Riyadh for it to diplomatically recognize Israel. But those talks include Saudi Arabia pushing for a nuclear cooperation deal that includes America allowing it to enrich uranium in the kingdom — something that worries nonproliferation experts, as spinning centrifuges open the door to a possible weapons program.

Prince Mohammed already has said the kingdom would pursue an atomic bomb if Iran had one, potentially creating a nuclear arms race in the region as Tehran's program continues to advance closer to weapons-grade levels. Saudi Arabia and Iran reached a détente in recent months, though the region remains tense amid the wider tensions between Iran and the U.S.

Higher oil prices would also help Russian President Vladimir Putin fund his war on Ukraine. Western countries have used a price cap to try to cut into Moscow's revenues. But those sanctions have seen Moscow be forced to sell its oil at a discount to countries like China and India.

Source: News18
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Indian Oil to invest $30 billion towards energy transition

Posted By: Anita Mamgai Posted On: Aug 25, 2023
IOC recently secured the 23rd position among global oil and gas enterprises in Bloomberg NEF's 2023 Energy Transition Score.t. Photographer: Amit Bhargava/Bloomberg News.

New Delhi: State-run Indian Oil Corporation (IOC) will invest $30 billion in its green initiatives, said chairman and managing director Shrikant Madhav Vaidya at the company's 64th annual general meeting,

This investment will be strategically allocated to fuel an array of comprehensive environmental sustainability measures across the corporation's vast operations, IOC said.

Vaidya's announcement “underscores IOC's unwavering commitment to aligning with India's ambitious green energy objectives and tackling climate change head-on."

A substantial portion of these funds will be channeled into cutting-edge research and development efforts aimed at pioneering breakthrough technologies. These innovations will play a pivotal role in substantially curtailing carbon emissions, showcasing IOC's determination to spearhead sustainable energy solutions on a global scale.

Crucially, this investment initiative will bolster Indian Oil's renewable energy portfolio, with a particular focus on expanding its footprint in the rapidly growing solar and wind energy sectors. By harnessing the inexhaustible potential of renewable resources, Indian Oil aims to cater to India's burgeoning energy demands while significantly reducing its ecological footprint.

Indian Oil's commitment goes further, with a resolute aspiration to achieve zero operational emissions by 2046. This goal encompasses a strategy to address both Scope 1 and Scope 2 emissions.

Indian Oil's resolute commitment to green practices has earned it international acclaim, the company said. The company recently secured the 23rd position among global oil and gas enterprises in Bloomberg NEF's 2023 Energy Transition Score.

Source: Live Mint
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What does the perfect carbon price look like

Posted By: Anita Mamgai Posted On: Aug 18, 2023
According to the World Bank, there are now 73 carbon-pricing schemes across the world, covering 23% of global emissions, up from just 7% a decade ago (Source: HT)

To most economists, putting a price on greenhouse-gas emissions is the best way to tackle climate change. It is efficient, allowing society to identify the cheapest unit of carbon-dioxide equivalent to forgo. It is fair: polluters pay; the proceeds can be redistributed. And it aids other forms of decarbonisation: complying with a carbon price forces companies to track their emissions and investors to work out which of their assets are the dirtiest.

According to the World Bank, there are now 73 carbon-pricing schemes across the world, covering 23% of global emissions. That is up from just 7% a decade ago. The bank's tally includes both emissions-trading schemes, where polluters can trade permits in a market, and carbon taxes, where a government sets a price directly. The largest scheme is in China and was launched in 2021. It covers the country's energy industry, and therefore 9% of global emissions. Even in America, which is immune to the charms of carbon pricing at a federal level, an increasing number of states are setting their own prices. Washington state, the latest convert, launched its emissions-trading scheme in January.

Yet a growing number of centre-left economists, who might be expected to be vociferous supporters of carbon prices, have soured on the policy. These critics focus on two points. The first is that carbon prices are not aggressive enough. The EU's emissions-trading scheme, one of the most comprehensive, nevertheless excludes buildings and transport. Allowances are given to airlines and heavy industry in the name of competitiveness. Prices are relatively high in Europe, reaching a record €100 ($107) a tonne of carbon-dioxide equivalent in February, but too low elsewhere. The World Bank reckons less than 5% of emissions are priced at or above the level that would be required, by 2030, in order for temperature increases to be limited to 2°C above pre-industrial levels.

This tentative action reflects the critics' second worry: equity. They argue that rather than ensuring polluters pay, the cost of carbon prices falls too heavily on the poor. Such initiatives raise energy prices—usually the only area of the economy that is entirely subject to them—and push industrial jobs overseas, beyond the reach of emissions-trading schemes. Anticipating pushback on these grounds, politicians water down the schemes. Therefore the promised emissions cuts never materialise.

These are the arguments. How does the evidence stack up? Measuring the impact of carbon prices is challenging. Carbon prices, like interest rates, both affect and are affected by the economy. All else being equal, a higher carbon price will lower economic activity and raise consumer prices. But a stronger economy will also raise the price of a carbon permit. Politicians may also be more comfortable raising carbon taxes when the economy is booming. They might take steps to cut them in bad times. For instance, in May last year the European Commission announced an auction of surplus permits during the energy crisis that followed Russia's invasion of Ukraine, in order to bring down prices

Thankfully, there are ways to disentangle cause and effect. Marion Leroutier of the Stockholm School of Economics uses a “synthetic control" method to examine a top-up tax on the eu's emission-trading scheme that was introduced by Britain in 2013. To see the effect of this higher carbon price, Ms Leroutier employs data from other eu countries to fashion a hypothetical version of Britain that did not introduce the tax—akin to a control group in an experiment. In reality, interconnectors allow Britain to import electricity from neighbours, potentially making the control group also subject to the treatment. But having included an estimate of such “spillovers", Ms Leroutier estimates that the tax led to a 20-26% reduction in emissions from the energy industry.

In a forthcoming paper Gilbert Metcalf of Tufts University and James Stock of Harvard University attempt to account for the broader economic context. They look at 31 European countries, controlling for past emissions and economic growth, in order to isolate variation in carbon prices that is unexplained by the state of the economy. The authors find that carbon taxes reduce greenhouse-gas emissions much as economists have previously predicted. Significantly, they also find virtually no effect, either positive or negative, on economic growth and employment, perhaps because there was more innovation than anticipated.

A final method of disentangling cause and effect is to employ an “event study". These are often used to assess the impact of monetary-policy decisions. By looking at the near-instantaneous reaction of carbon prices to a policy announcement, it is possible to remove the effects of background economic conditions, which do not change at the same speed. The impact of the change in price can then be tracked through the economy. In a recent working paper Diego Känzig of Northwestern University did just this, finding that higher carbon prices lower emissions and encourage green innovation. Yet these gains come at a cost. The higher prices raise energy costs and thus reduce the incomes of the poor.

Get the green right

Carbon prices have successfully cut emissions when used. They could be more palatable, however. In another paper, Mr Känzig compares the EU's emissions-trading scheme and national carbon prices. Although national taxes are more likely to lead to leakage, where polluting activity shifts across borders, they are less of a drag on the economy, helping neutralise criticism from centre-left critics. This is because revenues are often recycled using tax cuts, which can be aimed at the poor.

The World Bank estimates that carbon taxes and emissions-trading schemes will raise $100bn for governments this year. As carbon-pricing schemes expand, the amount will only grow. By itself, this will help tackle one criticism: that the measures are insufficiently aggressive. To tackle the other—that they harm the poor—policymakers must embrace the importance of recycling.

Read more from Free exchange, our column on economics: 

What performance-enhancing stimulants mean for economic growth

(May 25th) Robert Lucas was a giant of macroeconomics (May 18th)

A new world order seeks to prioritise security and climate change (May 11th)

For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter.

© 2023, The Economist Newspaper Limited. All rights reserved. From The Economist, published under licence. The original content can be found on www.economist.com

Source: Live Mint
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Iran's Foreign Minister Meets Saudi Crown Prince Mohammed bin Salman in Jeddah Updated 21 minutes ago

Posted By: Aditya Gogoi Posted On: Aug 18, 2023

Iran's foreign minister met Saudi Arabia's de facto ruler on Friday during his first visit since the Middle East rivals announced a surprise rapprochement, officials said. Hossein Amir-Abdollahian, who travelled to Riyadh on Thursday, held talks with Crown Prince Mohammed bin Salman in Jeddah, the Saudi foreign ministry announced, after extending what had been scheduled to be a one-day visit.

The two reviewed relations between the countries, “future opportunities for cooperation… and ways to develop them, in addition to discussing developments in the situation on the regional and international arenas", the foreign ministry posted on X, formerly known as Twitter.

Iran's official IRNA news agency said it was the first time a senior Iranian official had met with Prince Mohammed, 37, who has ushered in a series of reforms.

Shiite Muslim-majority Iran and Sunni-ruled Saudi broke off ties in 2016, but they agreed to restore diplomatic relations in a Chinese-brokered deal in March.

The announcement sparked optimism as the two regional heavyweights have backed opposing sides in conflict zones across the Middle East for years, including in Yemen, Saudi's impoverished neighbour.

On Thursday, Amir-Abdollahian said ties “are progressing in the right direction" as he appeared in front of the media with his Saudi counterpart, Prince Faisal bin Farhan. His visit would “be a prelude to the meeting of the heads of the two countries", he said, without specifying when Iran's President Ebrahim Raisi would travel to Saudi Arabia at King Salman's invitation.

Iran's top diplomat hailed economic and security cooperation between the two countries, but announced no new agreements. He was accompanied by Iran's new ambassador to Saudi, Alireza Enayati. “We are sure that these meetings and cooperation will help the unity of the Islamic world," Amir-Abdollahian added, proposing a “regional dialogue" without giving details.

Since the March deal, Saudi Arabia has ramped up a push for peace in Yemen, holding direct talks with Huthi leaders in the Yemeni capital Sanaa, and championed the return of key Iran ally Syria to the Arab League.

Source: News18
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Sucking a carbon-neutral fuel out of thin air

Posted By: Pawan George Posted On: Aug 08, 2023
For Porsche, cars powered by e-fuels will be a sideline rather than its main business (Photo: Reuters)

When in March the European Union approved a law requiring all new cars to have zero carbon emissions from 2035, Germany managed to wangle an exemption for vehicles running on “e-fuels". Some saw it as a charter for producers to continue flogging internal-combustion engined cars to petrol-heads. While it does, indeed, mean some petrol-powered sports cars are likely to remain in production in the future, the hope is they can be powered without overheating the planet.

E-fuels get their name because they are made synthetically, using electricity. The process involves combining hydrogen with carbon to produce various hydrocarbon fuels, such as diesel, petrol or jet fuel.

The hydrogen can be made by using electrolysis to split water into its constituent elements. The carbon comes from carbon dioxide, perhaps captured from an industrial chimney-stack, or even sucked directly out of the atmosphere via so-called direct-air capture systems. Provided both processes are powered by zero-carbon electricity, e-fuels are carbon neutral. After all, the carbon released back into the air when the fuels are burned is the same that was used to make them in the first place.

Although a handful of big plants already make e-fuels for aviation, most obtain their carbon from old cooking oil, animal fat and biomass. Some aim to use direct-air capture, although the technology is still largely at the prototype stage. One such plant is in southern Chile. It is run by a group of companies that includes Porsche, part of the German Volkswagen group. Chile is a windy place, so the factory is powered by a wind turbine. Until its direct-air capture system is ready, the plant is getting carbon dioxide from a brewery, where yeast produces it during fermentation.

For Porsche, cars powered by e-fuels will be a sideline rather than its main business. The firm aims to have more than 80% of its vehicles running on batteries by 2030. Karl Dums, the firm's head of e-fuels, readily agrees that an electric car will always be inherently more efficient than one that runs with e-fuels. (This is because of the extra steps involved in turning electricity into synthetic fuel, rather than just charging a battery directly.) But, he says, there will still be plenty of internal-combustion vehicles on the road after 2030. These could be made greener by filling them with e-fuels.

Dr Dums reckons economies of scale could make e-fuels competitive with fossil ones, perhaps by the end of the decade. And, he says, they offer a convenient way to store surplus renewable energy, or to make it suitable for export. Chile has the potential to produce huge amounts of renewable power. But the wind and the sun are unpredictable, and on some days could produce more electricity than necessary. Chile lacks the long-range grids to transmit that surplus elsewhere. If it were turned into a liquid, though, it could be shipped abroad using existing infrastructure designed for fossil fuels.

“In the end," says Dr Dums, Porsche's business is “fulfilling dreams for our customers." Although electric cars are both smooth and nippy, some of those customers might miss the growl and thunder of a petrol-powered engine. If you do fancy a petrol-powered 911 in the future, e-fuels might allow Porsche to sell you one.

For more coverage of climate change, sign up for The Climate Issue, our fortnightly subscriber-only newsletter, or visit our climate-change hub.

© 2023, The Economist Newspaper Limited. All rights reserved. From The Economist, published under licence. The original content can be found on www.economist.com

Source: Live Mint
Related Posts: CLEAN ENERGY,EFUELS,ZERO CARBON EMISSIONS,EUROPEAN UNION,PORSCHE,ELECTRIC VEHICLES,EVS,RENEWABLE ENERGY,VOLKSWAGEN,CLIMATE CHANGE,CARBON EMISSIONS

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Ukraine Conflict

Posted By: Tarun Kumar Posted On: Aug 05, 2023

India's National Security Advisor Ajit Doval is currently in Jeddah participating in a Saudi-led peace effort to end the Ukraine crisis. Repeated invitations for India to attend such significant events related to global peace underscore its escalating status as an international powerhouse. Previously, India was a guest at the G7 summit in Tokyo, where the Ukraine issue was a central topic.

Prime Minister Modi has consistently stressed the need for peace and dialogue as the solution to the Ukraine conflict. His statement to Russian President Vladimir Putin — “this is not an era for war” — aligns with this stance.

Throughout the ongoing Ukraine crisis, India's diplomatic finesse has been prominently visible. It swiftly engaged with both conflicting parties at the onset of the war to ensure the safe evacuation of Indian citizens from the conflict zone.

Following this, India has managed to strike a balance between its relationships with both Russia and Ukraine, while also safeguarding its national interests. India's approach has been characterised by a commitment to peace, while at the same time upholding dignity of both parties.

India has preserved its longstanding alliance with Russia, as evidenced by its abstention from the UN Security Council resolution condemning Ukraine's invasion. However, India has also acknowledged Ukraine's sovereignty and territorial integrity.

PM Modi has interacted equally with both Vladimir Putin and Ukrainian President Zelenskyy. India has consistently called for an end to hostilities, aligning itself with the wider international community's plea for peace.

Simultaneously, India has sustained its trade relations with Russia, escalating its petroleum product purchases to unprecedented levels. Concurrently, India has extended humanitarian aid to Ukraine, including food and medicines.

India's role in the G20 discussions on the Ukraine war has been widely lauded. Despite the ultimate failure to arrive at a joint statement on Ukraine, its diplomats worked tirelessly, navigating intricate diplomatic channels.

India's capacity to maintain this equilibrium can be attributed to its independent foreign policy, which prioritizes its national interests. This is a clear manifestation of India's ‘Vasudhaiva Kutumbakam' philosophy.

India's place at the high table of international relations is a result of its adept diplomacy, robust economy, and formidable military. India has now firmly established itself as a significant player in global affairs and is poised to assume an even larger role in the coming years.

The head of Ukraine's presidential office, Andriy Yermak, confirmed last week that a Ukrainian-organized peace summit would take place in Saudi Arabia.

Ukraine, the United States, Brazil, India, South Africa and several other countries were expected to take part.

Ukraine has in the past described its 10-point peace plan as including the restoration of Ukraine's territorial integrity, the withdrawal of Russian troops, the release of all prisoners, a tribunal for those responsible for the aggression and security guarantees for Ukraine.

Source: News18
Related Posts: UKRAINE,RUSSIA,G20,SAUDI ARABIA,AJIT DOVAL

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