2024-02-16 editor

The progress towards decarbonization has had several disruptions in supply chains and energy provision, primarily due to three key factors:

  1. Retractions in climate mitigation policies and an increase in carbon reliance through the further development of fossil fuel infrastructure and policy decisions.
  2. Diminishing prospects for continued cost reductions in renewable energy technologies.
  3. Heightened macroeconomic instability amid growing geoeconomic fragmentation and the resulting policy responses.

In 2024, 80 regions (contributing to 67% of global GDP) will be holding elections. The outcomes of these elections will determine the trajectory of the energy transition within their respective jurisdictions until 2030, with significant implications for energy trade, spanning from the export of oil and gas to the localization of clean-energy supply chains. For instance:

  • In the US presidential election, a Republican presidential victory could result in the rollback of existing measures, such as revised definitions of clean hydrogen or local content requirements established under the Inflation Reduction Act. Conversely, a Democratic presidential victory is more likely to signal continuity in current policy directions.
  • In the EU, the parliamentary elections signify the commencement of the Green Deal.
  • In the UK, the victor of the election will redefine the nation’s clean energy strategies, particularly on offshore wind auction levels and directing investments towards subsidy-dependent technologies such as new-build nuclear power and carbon capture and storage capabilities.

Political uncertainty is poised to increase investment uncertainty in the upcoming year. This may lead some companies to halt major project decisions until after election outcomes are determined. Emerging technologies such as hydrogen or carbon capture and storage, along with projects in sectors heavily reliant on government support—such as steel, cement, and petrochemicals—are particularly vulnerable.

Geo-economic fragmentation and the potential decoupling of trade multilateralism pose risks for short-term scenarios

A decline in economic and technological cooperation driven by geopolitical tensions could impede global decarbonization efforts, particularly amid the escalating trade disputes between the United States and China.

The intensifying trade war between the United States and China may lead to costly trade-offs for businesses. For example, Korean auto companies heavily invested in the US could lose eligibility for tax credits under the US Inflation Reduction Act if their electric vehicles continue to utilize battery components or critical minerals sourced from China. Similarly, Japanese firms face increased scrutiny over their expansion plans in the US due to their business dealings in China, presenting a trade-off for Japanese corporations.

Domestic fiscal policies can have cross-border spillover effects. This includes instances where incentives for creating electric vehicle supply chains outside of key manufacturing hubs are driven by geopolitical rather than economic factors. Additionally, responses of trading partners to international spill overs resulting from significant climate-related subsidies, such as those outlined in the US Inflation Reduction Act, could lead to market access disputes and retaliation. Subsidies may also prompt trading partners to adjust their climate policies to maintain industrial competitiveness.

Outlook to watch:

While geopolitical tensions, trade disputes, and permitting obstacles may present hurdles, there are also clear signs of progress for advancement. The momentum towards cleaner energy solutions underscores the importance of continued efforts. For 2024, we expect to observe the following development:

Climate Technologies:

  • Acceleration in commercialization or large-scale deployment. Expected in the energy transition in 2024, with advancing progress in technologies like carbon capture, hydrogen, and sustainable aviation / maritime fuel.
  • Anticipating a utility-scale pilot of liquid metal batteries and other emerging battery storage technologies supporting grid efforts. Energy storage additions are anticipated to rise by a third in 2024 compared to the previous year, reaching a record 57 gigawatts or 136 gigawatt-hours.
  • Global installations of wind, solar, and storage are forecasted by Bloomberg’s analysis to exceed 680 gigawatts in 2024, indicating a 22% increase from 2023.
  • Green infrastructure developments such as charging networks and hydrogen hubs continues to grow.


  • Anticipating loose gas balances in the US with healthy storage levels driven by production.
  • Limited growth in China’s LNG demand due to higher pipeline imports from Russia and robust domestic gas production.
  • Continuation of LNG resales from China driven by growth in contracted volumes surpassing gas demand expansion.
  • Expectation of lower gas demand in power generation in Japan and South Korea due to increased nuclear and coal generation.

EV Charging:

  • Expecting uptake of time-of-use tariffs by charging operators globally.
  • Contracts between utilities and energy developers to provide renewable energy and mitigate impacts on electricity systems.
  • Growth of public charger installations in China projected to continue.
  • Substantial EV infrastructure and energy projects underway in the UK and Europe signal positive momentum.
  • Focus in 2024 will be on incorporating new technologies to reduce the cost of EV batteries, enabling companies to lower prices and devise flexible pricing strategies for the mass market.
  • Megawatt charging emerges as a pivotal technology for commercial vehicle electrification, with deployment expected to begin in 2024.

Carbon Capture and Storage (CCS):

  • Due to IRA tax credits, CCS projects targeting highly concentrated CO2 streams from sources like natural gas, ethanol, and ammonia have become profitable. Economics have also improved for less-concentrated industries such as cement and steel, with technology advancements contributing to cost reductions. It is estimated that these efforts could lead to significant cost reductions of 30% to 50% in the next five years.
  • Chemical absorption with liquid solvents is the most commercialized type of carbon capture technology, with cost reduction efforts focused on developing more durable solvents and re-engineering absorbers.
  • Infrastructure investment is on the rise, yet companies hesitate to invest in storage facilities without assurance of sufficient capture and transport infrastructure. Permitting and development processes for CCS infrastructure can be lengthy, taking up to four years for pipelines and storage facilities.
  • Nonetheless, progress has been made in transportation infrastructure in the US, exemplified by Exxon’s acquisition of Denby, a company with access to the largest CO2 pipeline in the US, as part of Exxon’s plan to develop a large-scale CCS hub in Houston.


  • Disappointment in hydrogen projects in previous years, but 2023 policies expected to spur more investment in 2024.
  • Policymakers worldwide signals support in hydrogen growth, with 52 markets already having a hydrogen strategy as of October 2023.
  • BloombergNEF estimates that 21,000TWh of electricity will be required for green hydrogen production by 2050 under its Net Zero scenario, equivalent to three-quarters of the world’s current power demand.
  • Many electrolyser manufacturers are not yet profitable and will require increased demand to achieve profitability and generate cash flow. Nonetheless, rise in electrolyser shipments is supported by EU quotas, US tax credits clarity, and Japan’s subsidy programs.
  • Challenges including technical issues with electrolyzers and delayed policies affecting growth.
  • Key markets to watch in 2024 include the US, Europe, Japan, South Korea, and China in the hydrogen sector.

GLy ecosystem update:

Volvo Cars is evaluating a potential adjustment to its shareholding in Polestar, with plans to transfer its 48% in Polestar to Geely. As a result, Volvo Car will not provide further funding to Polestar while Geely will continue to provide full operational and financial support to Polestar going forward. Under the new arrangement, Volvo Cars will extend the repayment period for the existing convertible loan by 18 months to the end of 2028. Volvo Cars and Polestar will also continue their operational collaboration across R&D, manufacturing, and commercial efforts.

Also, a first look at Polestar Phone

L Catterton Asia Acquisition (LCAA) has filed the final prospectus for its merger with Lotus Technology. The merged entity will list on the Nasdaq with an enterprise value of approximately $6.1 billion. Lotus Technology is owned by Geely Holding and Etika Automotive, and following the merger, these shareholders, along with NIO Capital, will retain their shares in the combined company, owning about 78.7% of the equity.

Renault and Geely’s joint venture for ICE powertrain technology is expected to be finalized by the end of February. The two automakers signed an agreement in July to launch a powertrain technology company, with each holding a 50% stake. Saudi Arabia’s Aramco is also set to announce an investment in the venture, following a letter of intent signed with Renault and Geely in March 2023. The new company will encompass 17 engine plants and 5 R&D centers across three continents.

Methanol-Hydrogen Technology, a Geely owned entity, provider and developer of methanol-hydrogen electric vehicles, raised $100mm of venture funding at a $1.1bn post-money valuation from undisclosed investors

Geely Group recorded significant sales increase for 2023, up 20% YoY in overall sales to 2.79 million units in 2023, setting a new record for the Group. The Group has seen sales of electrified and clean alternative fuel passenger and commercial vehicles grew over 51% YoY to approximately 980,000 units and accounting for 35% of Group aggregate sales. Geely’s SEA platform plays critical role with the Group’s continued focus on electrification, next-generation technologies and synergies in sustainability. During 2023, the Group’s core advantages in synergy building and technology sharing was highlighted with the launch of several new electric models across Geely’s brand portfolio developed on Geely’s SEA and its derivatives.

What We’ve Been Reading This Month:

Volkswagen is in discussion with French company Blue Solutions to develop solid-state EV batteries, aiming to finalize a joint development agreement in the coming months. Blue Solutions plans to adapt the technology for passenger cars, potentially offering longer ranges and shorter charging times than traditional lithium-ion batteries.

Kia signed MoU with Uber to jointly develop and deploy electric Purpose Built Vehicles (PBVs) specifically designed for ride-hailing, with plans to launch in 2025.

BMW plans to increase its all-electric sales share from 15% to 33% by 2026 and aims to sell 3 million vehicles by 2030 with an 8-10% margin in its automotive segment. However, BMW expects combustion engine and all-electric car margins to reach parity no earlier than 2026 due to higher costs associated with new battery technologies.

Northvolt has secured a $5 billion non-recourse project financing deal to support the expansion of its facility in northern Sweden. This funding, the largest green loan raised in Europe to date, will enable the expansion of cathode production, cell manufacturing, and the adjacent recycling plant.

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