January 2024 Global Energy Regulation Round-Up

The “Global Energy Regulation Roundup” is dedicated to capturing and understanding emerging climate, energy, and reporting measures. Currently, international governments are increasingly establishing stricter policies on emissions reporting, trade, and energy. The purpose of this monthly blog is to highlight approaching regulations and educate key stakeholders about their effects on a range of industries.

The European Union 

Lawmakers in the European Parliament adopted a new anti-greenwashing law banning certain commercial practices. These practices include the use of unproven generic product claims, such as “environmentally friendly,” or “climate neutral,” or marketing a product as having a reduced environmental impact based on the use of emissions offsetting schemes. A recent study completed by the EU Commission found that more than half of green claims by companies in the EU were vague or misleading, and 40% of the statements were not backed up with real facts or corresponding data. 

Key aspects of the new law include rules aimed at making product labels clearer by banning the use of generic environmental claims not backed up with proof, and the regulation of sustainability labels to allow only the use of those based on official certification schemes or established by public authorities. The law will also ban the use of claims based on offsetting schemes that indicate that a product has a neutral, reduced, or positive impact on the environment.

The new legislation must now be approved by the EU Council, which reached a provisional agreement in September with Parliament on the proposals, before passing into law. Once published in the EU’s Official Journal, member states will have 2 years to integrate the rules into national law.

Additionally, The European Commission is set to recommend the EU reduce its net greenhouse gas emissions by 90% by 2040, from 1990 levels, to ensure the bloc can reach net zero emissions a decade later. This will be the EU’s first 2040 target and its current target aims to reach net zero by 2050 and 55% by 2030.  

United States 

In the United States, President Biden announced a pause in approvals for pending and future applications for exporting liquefied natural gas (LNG) from new projects. The DOE will use this time to conduct a review that looks at the economic and environmental impacts of projects seeking approval in Europe, Asia, and where fuel is in hot demand. Administration officials vowed that the pause would not hurt allies, as it has an exemption for national security should they need more LNG.

The US became the top LNG exporter after the Ukrainian war to offset the loss of Russian imports to EU countries. Over the past two years, more than 60 percent of U.S. LNG exports ended up in Europe. Currently, there are over 10 billion cubic feet of natural gas pipeline infrastructure under construction. 

The last review of LNG export projects was in 2018 when export capacity was 4 billion cubic feet per day (bcfd). That capacity has tripled and is set to shoot higher by 2030 with projects under construction. Administration officials vowed that the pause would not hurt allies, as it has an exemption for national security should they need more LNG. 

China

China has issued its first set of proposed standards for recycling retired onshore wind turbines, laying the foundation for tackling supply chain sustainability challenges arising from renewable energy generation. The country will generate an estimated 13 million tonnes of wind turbine waste by 2050. 

The proposed standards prioritize the reuse and recycling of wind blades while banning landfilling and burning, according to the report published by the National Energy Administration. The standards will be open for public consultation until the end of next month. The country will generate an estimated 13 million tonnes of wind turbine waste by 2050. For other components, such as blade hubs, towers, and nacelles, recycling should involve physically blasting and cutting them into small pieces and using magnetic sorting to extract recoverable metals.

“Recycling of decommissioned equipment is essential [as] it reduces waste, improves resource efficiency, [and] prevents pollution and ground or surface water contamination,” said Li Jiatong, project leader in Greenpeace East Asia’s Beijing office, noting the United States and the European Union have similar guidelines.