Today’s ESG Updates
- Grid Bottlenecks Threaten Growth: Increased electricity demand from AI, EVs, and electrification is straining power grids and slowing economic growth.
- U.S. Pushes Back on EU Methane Rules: Washington is seeking exemptions from the EU’s methane emissions law for U.S. oil and gas exports.
- Google Signs Malaysian Solar Agreement: Google signed a long-term power agreement for a 30MW solar project in Malaysia.
- China’s Fossil Power Declines: China is on track for its first annual drop in fossil fuel power generation in a decade as wind and solar output grow.
Increase in grid stress slows economic expansion
Global electricity consumption has outpaced expectations as electrification, AI data centers, and electric vehicles rapidly expand. Grids are becoming overwhelmed by this increase in use. ASML Holding NV, a Dutch chip machine manufacturer, is facing setbacks as a direct result of the Netherlands’ stressed grid. The company is one of 12,000 Dutch companies seeking electric grid connections. Debby Dröge, a communications strategist for the grid operators association Netbeheer Nederland, said, “The Netherlands is already using as much electricity as was originally projected for the year 2030. The physical grid cannot keep pace with societal ambitions and developments — unless we fundamentally change how we design and use it.” Without faster grid expansion, countries risk losing critical AI and industrial investments that will shape growth for decades.
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Further reading: Electricity Is Now Holding Back Growth Across the Global Economy
US demands exemption from EU methane emissions law
The European Union’s methane emissions law is set to take effect this year, requiring importers of gas and oil to report methane emissions. The U.S. is demanding exemptions for its oil and gas exports until 2035. In a document seen by Reuters, the U.S. government said, “The EU Methane Regulations is a critical non-tariff trade barrier that imposes an undue burden on U.S. exporters and our trade relationship.” While EU lawmakers have simplified the law, they refuse to weaken its core requirements. The U.S. also asked the EU to allow U.S. exporters to automatically comply with the law by making U.S. requirements equivalent to those of the EU. It is unlikely that the United States will be awarded equivalent requirements.
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Further reading: US demands EU exempt its gas from methane emissions law, document shows
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Google invests in Malaysian solar power, partnering with Shizen Energy
Google has invested in clean energy in Malaysia by signing a solar power purchase agreement. Under the agreement, Google will buy power from a 30-megawatt solar farm located in Malaysia’s Kedah state. Alongside Japan’s Shizen Energy, Google hopes to decarbonize by expanding clean energy operations. The agreement highlights how major technology companies are using long-term power purchase agreements to meet decarbonisation goals, despite Asia being one of the most challenging areas to decarbonize. The project is expected to begin operations in 2027 and is part of the country’s green power expansion under Malaysia’s Corporate Green Power Programme. The government aims to have 70% renewable power capacity by 2050. Companies looking to decarbonize operations should use ESG solutions.
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Further reading: Google signs solar power pact in Malaysia with Shizen Energy
China sees decrease in fossil fuel output for the first time in 10 years
As renewables expand across China, the country expects to see its first decline in fossil fuel use since 2015. Power generation from oil, gas, and coal-fired plants decreased by 0.7% this year, according to data published by the National Bureau of Statistics. Unless there is a sharp rebound in December, this would mark the first annual drop in a decade. China’s coal plants are the world’s leading source of greenhouse gases, but their use is declining as renewables meet energy demand. Solar power saw an increase of 23% output this year, with wind power following closely behind with a 22% increase. While emissions from the power sector are decreasing, this improvement is largely offset by growth in China’s plastics and chemicals industries. While coal production has declined for five straight months, oil and gas output continues to increase.
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Further reading: China’s Fossil Fuel Power Output Set for First Drop in a Decade
Editor’s Note: The opinions expressed here by the authors are their own, not those of impakter.com — In the Cover Photo: Power lines. Cover Photo Credit: Roger Starnes Sr
