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CARBON FORWARD ASIA
Countries in a position to export carbon credits, especially in the Asia-Pacific region, are increasingly willing to participate in international carbon trading under the Paris Agreement but will need assistance with the complex rules as well as how to go about their implementation, panellists at the Carbon Forward Asia conference said on Tuesday.
Chinese regulators will likely prioritise nature-based solutions (NBS) and small-scale renewable energy projects once the national offset programme is brought back to life given growing concerns over additionality, experts told a conference in Singapore Tuesday.
India’s forthcoming carbon market will have little problem on the supply side, but demand for carbon credits could be an issue as the world’s third-largest emitter makes moves towards a fully operational market around the middle of the decade, panellists told the Carbon Forward Asia conference on Tuesday.
Governments seeking to regulate corporate climate claims in a bid to clamp down on greenwashing risks creating conflicting messages from global companies that span different jurisdictions, VCM panellists told the Carbon Forward Asia conference in Singapore on Tuesday.
Additional sales of EU Allowances from the Innovation Fund for the bloc’s REPowerEU plan will only start in 2024 after the auctioning regulation is updated, a source at the European Commission told Carbon Pulse on Tuesday, thereby withholding up to 40 million tonnes in additional market supply that had been anticipated by experts this year.
EUAs jumped substantially on Tuesday morning after the European Commission said auctions of some allowances from the Innovation Fund to help finance the REPowerEU initiative would be delayed, triggering a price increase of as much as 5.8% in busy trading, before the afternoon brought some selling back into the market.
The European Parliament’s initial response to the bloc’s carbon removals bill doesn’t fix the controversial proposal and keeps flaws, green groups in Brussels claimed on Tuesday.
A cross-stakeholder group on Tuesday announced new timelines for its Claims Code to guide corporates’ use of voluntary carbon credits, aiming to tackle environmental integrity in the demand side of the market.
Voluntary carbon market trade was brisk over the past week, after REDD avoided deforestation prices turned a corner to edge higher after 2016 vintages (V16) from a well-known project struck $2 to attract a flurry of transactions.
A carbon offset project developer said it has notched an jump in its forward sales of more than €1 mln, drawing from an estimated 40 mln credits in its project pipeline.
As the world’s largest standard body Verra expedites new rules on how to measure GHG improvements from forest protection, experts at a carbon credit ratings agency have pointed out strengths and risks to the proposed approach.
An asset management company has partnered with a fintech firm to invest in a Cambodian biochar facility that will then advance purchase the resulting 16,000 carbon removal units in the project’s first phase, the firms said in a release.
A Canadian carbon credit investment firm launched a new offset programme on Tuesday for building owners to generate revenue from emissions reduction initiatives.
ESG commodities platform Xpansiv expects to post pre-tax profits at the end of this financial year after halving losses in 2022 and almost doubling revenue, the company said in a statement on Thursday, as it shrugged off concerns from its auditor that ongoing operations were in doubt if financiers withdrew support.
Finnish carbon offset firm Compensate Operations Ltd announced a significant scaling down of its operations due to difficulties in securing additional funding.
A US-based forest carbon tech firm is stepping back from project development and shifting strategic focus, laying off nearly half of its remaining workforce after making similar cuts last year amid the global voluntary carbon market downturn.
New York lawmakers dropped virtually all programme design-related elements for the state’s economy-wide cap-and-trade system in a revised budget package presented Monday, instead merely detailing how the Empire State will distribute allowance revenues via rebates or climate investments.
The Northeast and Mid-Atlantic US RGGI power sector cap-and-trade system saw its permit glut decline in 2022 in tandem with the programme’s bank adjustment, according to a report published Tuesday, while updated data showed year-on-year CO2 output slid even further in Q1.
Power generators regulated by Massachusetts’ Global Warming Solutions Act (GWSA) cap-and-trade saw their CO2 output drop to the lowest since 2020 over the January-March period, according to data updated Tuesday.
UAE climate envoy Ahmed Al Jaber on Tuesday backed a move to phase out “fossil fuel emissions” ahead of his country’s hosting of the UN COP28 summit later this year, as well as a tripling of global renewable capacity.
BIODIVERSITY (FREE TO READ)
The UK government has launched a new bid to boost biodiversity recovery in its overseas territories, with large-scale projects funded for the first time to tackle nature loss, it said in a release.
A nature capital alliance in partnership with a UK-government fund, has opened a call for applicants from ocean-based projects, as it aims to drive investment of over $500 million into the space by 2030.
The independent Papua New Guinea Biodiversity and Climate Fund has issued a second funding call for projects aiming to earn protected area status and help the megadiverse country reach its international biodiversity commitments.
Analysts have raised their short-term forecasts for EU carbon prices, but warned of coalescing bearish pressures including from increasing permit supply and weakening fundamentals.
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Grow to Zero! – June 26-27, London: Insightful discussions on carbon market evolution? Thought leadership on blended finance for impact? Networking with impact investors and sustainability professionals? Find it all at Gold Standard’s Conference, Grow to Zero! 26-27 June 2023 at Kings Place, London. Tickets and agenda details available here: www.growtozero.co.uk
BITE-SIZED UPDATES FROM AROUND THE WORLD
Carbon Pulse has teamed up with CME Group to provide its clients with regular updates on the global carbon markets. Check out these briefs for the latest insights on pressing trends and events impacting markets, published every other week. Registration required
Climate dialogue – International targets to expand renewable energies and increase energy efficiency are needed to put the global economy back on a path towards limiting the global temperature rise to 1.5C, Germany’s foreign minister Annalena Baerbock said at the Petersberg Climate Dialogue in Berlin. Key stakeholders had suggested that such topics would be high on the agenda in Germany, as Carbon Pulse had reported prior to the event. At the two-day climate talks, Baerbock also said that donor countries are finally on track to live up to their promise of providing $100 bln in climate finance to developing economies. A three-year delay had eroded trust between richer and poorer nations and held up international progress in recent years, said designated UN climate conference COP28 President Sultan Al Jaber at the same conference. He also called for a definitive assessment by donor countries ahead of the UN climate talks in Dubai which begin at the end of November. (Clean Energy Wire)
Falling behind – Israel is set to reduce its global warming emissions by just 12% by 2030, far below the 27% it promised the UNFCCC, a report published Monday predicted. If current trends continue, only 19% of energy will be generated by renewable sources by the end of the decade, compared with an official goal of 30%, the document prepared by the Israeli government showed. The annual report reviewed progress up to the end of 2021 on official emissions reduction targets, both across the economy and within various sectors. (Times of Israel)
Always sunny – An analysis of solar power markets in Europe has declared Germany the leading solar PV market in the region. According to the analysis conducted by Aurora Energy Research and reported in Tagesspiegel Background, strong political support and a large market have helped the country top the list ahead of Spain. In 2022, Germany was ranked second behind Spain. The main reason for the change is the German government’s ambitious target of installing 215 GW of solar capacity by 2030, and the enormous tender volumes associated with this. The country is also the largest market in Europe and has good grid access. However, it scored low for land availability, and it also lacks financial incentives to expand solar power in a way that is as gentle on the grid as possible. Other European countries with strong political backing for solar are France and Poland. Spain and Italy are the largest markets behind Germany, and Denmark, Sweden and Finland top the list for land availability. (Clean Energy Wire)
Highway to hydrogen – The German government and gas operators are putting together detailed plans for a nationwide hydrogen network, the country’s economy minister Robert Habeck has said. The Green politician said the final plans will be unveiled before the summer, public broadcaster NDR reported. Habeck added that the government would plan the network and tell the respective operators when to implement it step by step, though it has not yet been decided who will pay for it. Grid operators are being asked to build infrastructure for a fuel that is not produced in large quantities yet, so they need to make advance payments, said Habeck, adding that said state support could also be an option. (Clean Energy Wire)
So when would be a good time then? – Nigerian Vice President Yemi Osinbajo this week said that while the global call for a transition to cleaner fuels may be valid, it would be unreasonable for Nigeria to abandon its fossil fuel deposits at the moment. Osinbajo highlighted that in recent months, natural gas has taken the centre stage in global politics, especially with the war in Ukraine going on, and that this was a strong reminder of the complexity of energy security concerns that nations now face. He noted that as gas prices skyrocketed, countries have been forced to confront the vulnerabilities of their energy supply strategies, including Europe and America. Osinbajo also said the push to phase out fossil fuels quickly and discourage new investments in related projects is fast gaining momentum, stressing that Nigeria must take the call to action seriously, not just for the sake of the environment, but also for the economy and her people. (This Day)
High stakes – The US Supreme Court will hear a commercial fishing regulations case with implications about ‘Chevron deference’ – the doctrine that agencies deserve leeway in writing regulations if statutes are vague or silent on a topic – and the opposing ‘major questions’ doctrine – that regulations require clear authorisation by Congress, Axios reported on Tuesday. After the high court’s 2022 6-3 ruling limiting the EPA’s authority to reduce emissions from power plants, the upcoming Chevron deference case could impact the future regulating power of federal agencies.
Disclosure delays – US President Joe Biden’s administration is struggling over rules that would force American corporations to disclose more information about their climate risks and GHG emissions. As the administration leans into the climate disclosure campaign – led by the Securities and Exchange Commission, the General Services Administration, and the Treasury Department’s Federal Insurance Office – it is facing broad opposition from companies, as well as House Republicans and industry-funded groups that oppose Biden’s climate agenda. Supporters of the new rules fear that the agencies, facing the likelihood of lawsuits, might end up watering down or delaying their disclosure actions. Robert Jackson a former SEC commissioner and now a law professor at New York University, said Thursday that the SEC might wait months to finalise climate disclosure rules, delaying from April until the fall. (Washington Post)
Investor investigation – Thirty of the 318 Members of Parliament in Canada disclosed to the ethics commissioner as of Feb. 2023 active investments of over C$10,000 in fossil fuel companies made by themselves or their spouses, a joint investigation from The Narwal and the Investigative Journalism Foundation found Monday. Among the investors were 15 Conservatives, 14 Liberals, and 1 New Democrat Party member. However, Conservative MP Candice Bergen, who was among the investors, has resigned since the disclosure. While ministers are forbidden to own stocks apart from blind trusts, their spouses can purchase shares like a private citizen. Five ministers’ spouses in Justin Trudeau’s Liberal cabinet own stocks in fossil fuel companies, and seven Liberal members of the House of Commons standing committee on natural resources are among the investors.
Moe problems – Saskatchewan Premier Scott Moe says the province may not go along with an incoming federal emission policy that he believes would make it difficult to keep the lights on. Moe did not provide details Tuesday on what he might do to potentially block Ottawa’s clean electricity standards, but said more information is to be shared in the coming weeks. “We’re going to continue to chart Saskatchewan’s path,“ he told reporters after speaking at the Williston Basin Petroleum Conference in Regina. ”It may not necessarily be Canada’s path, and we’ll have more details on that in the coming weeks,.“ Moe said Saskatchewan can’t meet potential requirements that may be set out through the federal government’s clean electricity standards. The standards say emissions from electrical generation should be net-zero by 2035 and that conventional coal be phased out by 2030. (Canadian Press)
Washington offset talk – The Washington Department of Ecology on Tuesday announced it will hold two upcoming trainings for business and individuals that want to utilise offsets in the state’s WCI-modelled cap-and-invest programme. A May 10 training session will walk through the process and considerations for using offsets for compliance in the cap-and-invest programme, and a May 24 training will walk through the process, timeline, and requirements for developing an offset project.
2-CO2 storage deals – Carbon TerraVault Holdings (CTV), a subsidiary of energy management company California Resources Corporation (CRC) announced two CO2 storage agreements with bioenergy firm Yosemite Clean Energy, and gasification firm InEnTec for 40,000 t/yr and 100,000 t/yr respectively. Additionally, the agreement with Yosemite includes carbon capture and transport services for a facility that is estimated to produce 24,000 kg/day of H2, with the project expected to be commercial by 2026, the press release noted. CTV also submitted a Class IV permit to the US EPA for 34 MtCO2 storage, raising the firm’s total potential permitted storage to 174 Mt.
How to do it – The Ministry of Natural Resources and Environment has issued a plan on solutions to realise Vietnam’s commitment to cutting emissions to net zero by 2050 announced at the 26th UN Climate Change Conference (COP26) in the UK in 2021, VietnamPlus reports. The ministry will make amendments to legal documents, including contents concerning Vietnam’s commitments at COP26; reviewing and perfecting mechanisms, policies, and laws related to the implementation of commitments and international treaties in response to climate change. It will be also responsible for integrating climate change response into strategies and plans; reviewing and updating development strategies and master plans in line with the goals that Vietnam committed at COP26.
Hydrogen is the key – It is efficient, plentiful and might just be the quickest route to cleaning up Malaysia’s gas-and-coal heavy energy mix, but experts warn the march of green hydrogen is hindered by the spectacular costs of set-up in a country already lagging behind on its climate goals, South China Morning Post reports. Malaysia has set an ambitious target of raising its share of renewable energy in its total installed capacity to 40% by the end of the next decade, as it looks to hasten its energy transition from fossil fuels and meet its commitments made at the UN’s Climate Change Conference. This week, the Asian Development Bank added fresh urgency to Asia’s quest to avoid climate calamity, in a report warning that the region needs to virtually double the cash it spends on renewables and slash subsidies to its dirty energy producers.
Drive down emissions — The New Zealand government has estimated its Clean Car rebate programme will reduce 50% more emissions than originally estimated by 2035, and 230% more by 2025, it announced Tuesday. It said the scheme was exceeding industry and government projects, with 20% of new passenger car sales being electric in 2022, up from 8% the year before. The government announced it would strengthen the scheme by targeting rebates for new and used imports emitting less than 100 grams of CO2 per kilometre, compared to 146 grams under the original scheme. The scheme is now forecast to reduce emissions by 3.4 MtCO2e by 2035. Emissions from light vehicles are the single largest source of transport emissions in New Zealand.
Not anytime soon – China’s transition towards a unified national ETS may take place no sooner than 2030, based on the current policy developments, according to a report released Tuesday by Veyt. Currently, the Chinese ETS is limited to only the power sector and the plan for sector expansion was postponed in light of data-quality constraints. Given the lack of a clear policy roadmap, the full-scope expansion of the trading scheme might only be realised by the end o the fifteenth Five-Year Plan period (2026-2030). That means it is most likely that the phaseout of the ETS pilots and subsequently the establishment of the unified national ETS will take place no sooner than 2030, according to the Veyt report.
High-level help – Offset standard developer and manager Verra on Tuesday said it is now publishing high-level summaries of VCS methodologies, modules, and tools currently under development on its website in order to increase transparency around its methodology development process. By making this information available earlier on in the methodology development process, Verra said it is seeking to streamline that process, avoid duplication, and expedite the development of new projects.
Stocks secured – Toronto-headquartered project developer Base Carbon on Monday announced a deal with an unnamed broker to buy back up to 8.7 mln shares by June 16, according to a press release. That works out to 7% of the shares issued by the company in June 2022 on the NEO Exchange, a stock market specialising in purpose-driven innovation economy owned by Cboe Global Markets. Base Carbon’s stock price closed at 5.5 Canadian cents per share at the end of the trading day Tuesday following the news, up 12.4% from Monday’s close. If that price holds, the 8.7 mln shares would work out to just over C$479,000.
Greening the pitch – Legendary football team FC Barcelona travelled to their match against Madrid’s Getafe CF by train on Apr. 16, in an effort to curb the male football club’s emissions. The women’s football team by the same name already travels substantially more by train and bus than the male organisation, as do the male futsal, male handball, male basketball, and to a lesser extent, the male field hockey teams under the FC Barcelona flag. (Bloomberg)
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