This Week in Environmental & Energy Markets

Momentum around climate finance, nuclear power, and carbon pricing defined this week’s developments, while new challenges emerged across renewable deployment and marine fuel regulation. From evolving language in China’s coal policy to the launch of Portugal’s national carbon credit platform, energy markets and climate policy remain closely intertwined as COP30 draws nearer.

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Macroeconomics & Geopolitics

EU Public Climate Finance Reaches €31.7 Billion in 2024

The European Union contributed €31.7 billion in public climate finance to developing countries in 2024, representing a 10.8% year-on-year increase. A further €11 billion in private finance was mobilised. Approximately half of the public funding supported adaptation or cross-cutting projects. The announcement comes ahead of COP30, where a $1.3 trillion annual climate finance roadmap will be introduced to meet the 2035 target of $300 billion per year for developing nations.

US Commits $80 Billion to Nuclear Expansion

The Trump administration has pledged over $80 billion to acquire nuclear reactors from Westinghouse Electric Co., as part of a broader strategy to reinforce US energy infrastructure and bolster AI-driven industrial capacity. The move reflects a more interventionist industrial policy and forms part of a wider agreement that includes a $330 billion Japanese investment in US energy projects.

Mexico Pauses Tariffs After Bilateral Call

Following a call between President Claudia Sheinbaum and US President Donald Trump, Mexico has confirmed a pause on new tariffs scheduled to take effect on 1 November. The two governments will continue discussions regarding 54 pending non-tariff trade barriers. The announcement helps ease tensions after the US raised concerns earlier this year over alleged USMCA violations.

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Carbon Markets

Singapore Reaffirms Maritime Net Zero Commitment

Singapore’s Maritime and Port Authority has reaffirmed its commitment to maritime decarbonisation, clarifying that its proposal to defer the IMO’s Net Zero Framework vote was intended to strengthen consensus among member states. The delay, supported by countries including Saudi Arabia and Liberia, is not expected to impede Singapore’s domestic decarbonisation efforts. Demand for green marine fuel remains underpinned by EU regulatory drivers.

EU to Promote Carbon Pricing at COP30

EU Climate Commissioner Wopke Hoekstra has announced the EU’s intention to advance carbon pricing frameworks at COP30, highlighting alignment with Brazil, Mexico, Chile, and China. The EU Emissions Trading System (ETS) has reduced covered emissions by 50% over the past 20 years and generated €230 billion in public revenues. The Commission will also advocate for high-integrity voluntary carbon markets through its global task force.

Portugal Launches National Voluntary Carbon Market

Portugal has launched its national voluntary carbon market, alongside a digital platform for the registration of credits, verifiers, and transactions. The initial methodology focuses on forest carbon sinks, designed to enhance transparency and support domestic carbon offset initiatives. This development places Portugal among a growing group of countries formalising national VCM infrastructure.

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Renewables & Biofuels

UK Offshore Wind Auction Falls Short of Expectations

The UK’s latest offshore wind auction awarded £900 million to fixed-bottom projects and £180 million to floating installations. WindEurope described the outcome as disappointing, warning that it could jeopardise progress towards the UK’s 2030 offshore wind target of 50 GW. Analysts estimate the auction may only deliver 5–6 GW of new capacity, posing risks to future investment and employment growth.

Netherlands to Classify Marine UCOME as Fossil Fuel

The Dutch Emissions Authority will classify used cooking oil methyl ester (UCOME) as a fossil-equivalent fuel within the maritime sector under RED III implementation. This change excludes UCOME from generating compliance units under the maritime mandate, though it remains eligible for use in road and inland waterway transport. Suppliers may continue offering UCOME blends, but at a premium reflecting reduced compliance value.

Honeywell Launches Waste-Based SAF Technology

Honeywell has unveiled new technology to convert agricultural and forestry waste into sustainable fuels, including SAF, marine fuel, and petrol. The system enables biocrude to be processed into high-performance fuels using existing refining infrastructure, offering a more scalable and cost-effective pathway to low-carbon transport fuels.

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Corporate Sustainability & Regulation

United Airlines Expands SAF Usage Across US Airports

United Airlines has signed a new agreement with Neste to supply SAF at three major US airports, Houston, Newark, and Washington D.C. This aligns with United’s wider strategy to achieve net-zero greenhouse gas emissions by 2050 without relying on offsets. Deliveries are being integrated into existing fuel systems and will continue through 2025.

UK Introduces ESG Ratings Regulation

The UK Parliament has introduced legislation to regulate ESG ratings providers, bringing them under the supervision of the Financial Conduct Authority. The move aligns with IOSCO recommendations and aims to enhance transparency, governance, and conflict-of-interest standards within ESG data services. Both domestic and foreign providers offering ratings in the UK will be required to obtain FCA authorisation.

China’s Coal Policy Signals Flexibility on Peak Consumption

A new government communiqué indicates that China may allow coal and oil consumption to peak as late as 2030, a subtle shift from President Xi Jinping’s 2021 pledge to begin phasing down use during the 2026–2030 period. The adjustment offers greater flexibility to support economic and energy security goals but raises questions about global progress on coal phase-out efforts.

Banks Earn More from Green Bonds Than Fossil Fuel Loans

For the fourth consecutive year, global banks have generated higher revenues from underwriting green bonds and climate-focused loans than from financing fossil fuel projects. As of last week, climate-related underwriting brought in $3.5 billion, compared with $2.6 billion from fossil energy deals. European banks continue to dominate the green segment, while US banks remain prominent in fossil lending.

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Outlook

With COP30 fast approaching, this week’s developments underscore the deepening intersection of global climate finance, regulatory change, and geopolitical strategy. Carbon pricing, clean energy investment, and voluntary markets remain essential instruments, though uncertainty surrounding coal and renewable deployment targets continues to challenge long-term climate objectives.