CP Daily: Friday November 16, 2018

Published 01:33 on November 17, 2018  /  Last updated at 01:33 on November 17, 2018  /  Newsletter  /  No Comments

A daily summary of our news plus bite-sized updates from around the world.

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TOP STORY

California punts endorsement of Tropical Forest Standard to 2019

California regulator ARB on Friday postponed a decision until next spring on whether to approve the Tropical Forest Standard (TFS) that could allow jurisdictions to link their sector-based offset programmes to the state’s carbon market, with stakeholders warning of the standard’s environmental and social ramifications.

EMEA

EUA price rise will facilitate German coal phase-out, says industry

EU carbon prices will soon rise to levels that will force the closure of a number of German coal plants, according to a member of an industry association represented on the country’s coal exit commission.

Brussels orders Romania to recoup millions it gave utility to cover EUA costs

The EU has ordered Romania to recover over €60 million from utility CE Hunedoara, deeming illegal the government loans given to help the company meet its EU carbon market obligations.

It’s complicated: Modelling the relationship between EU carbon and fossil fuel prices

While EU carbon futures prices are increasingly seen as driving fossil fuel forward prices, researchers have found a looser relationship in the spot market and differing ones when it comes to the inverse, namely how each fuel affects EUAs.

EU Market: EUAs hold above €19 as power spreads hit 4-year high

EU carbon prices ended above €19 on Friday as the UK government stuck to its efforts to pass a Brexit deal, while a huge drop in coal prices boosted the prospects for coal generators to ramp up EUA buying.

ASIA PACIFIC

Australia issues 246k carbon credits to ERF-contracted projects

Australia’s Clean Energy Regulator this week issued 246,157 offsets to six projects that are all under contract with the government’s Emissions Reduction Fund (ERF).

NZ Market: NZU slump unlocks higher volumes after long lull

New Zealand carbon allowances suffered a third straight day of losses on Friday, with the increasing gap to the de facto price ceiling spurring sellers to come forward after months of near-zero trading.

Guangdong offsets sell at premium to allowances in small auction

China Southern Power Grid Co. on Friday auctioned off a small batch of offsets eligible for use in the Guangdong ETS that cleared 39% above the secondary market price for allowances.

CN Markets: Pilot market data for week ending Nov. 16, 2018

Below is a table of the closing prices, ranges and volumes for China’s regional pilot carbon markets this week. All prices are in RMB, and volumes in tonnes of CO2e. Data sourced from local exchanges.

AMERICAS

Nodal Exchange, IncubEx launch environmental trading products

Nodal Exchange and IncubEx launched their first tranche of environmental products in North American carbon, renewable energy, and other environmental markets on Friday, adding another player offering futures contracts in the market.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

**#OCTT – Carbon Pulse is helping to pioneer a new Twitter hashtag for tweets and discussion surrounding the world’s carbon markets. Starting today, we are using #OCTT in such tweets. Borrowing from the oil markets’ #OOTT, our acronym stands for the Organisation of Carbon-Trading Tweeters. Please join us in mainstreaming this new hashtag to further discussion of carbon markets on social media. Once it picks up steam, we can consider regionalising it based on the various schemes.**

Urgenda again – The Netherlands on Friday made good on its pledge to appeal to the country’s supreme court to overturn a 2015 case brought by citizen pressure group Urgenda that ordered it to set a deeper emission reduction goal. The judgement potentially establishes a global precedent in holding a state responsible for taking necessary steps to prevent dangerous climate change. The government said it is merely challenging the principle, and will abide by the deeper target, having already set policies to achieve it. (See Carbon Pulse’s article here)

Kicking them while they’re down – The EBRD has said it will not finance the construction of any new coal plants, including one in Kosovo that had its funding withdrawn by the World Bank last month. “We have issued a draft Energy Sector Strategy saying that we will not finance coal. This remains a draft and is subject to a final vote and approval by our Board in December,” an EBRD official said in a statement emailed to SeeNews. However, the official said the EBRD is as committed as ever to support Kosovo in securing sustainable, reliable, and affordable energy.

Here to stay – US EPA Acting Administrator Andrew Wheeler will stay on as the permanent head of the agency, President Trump announced on Friday. The former coal lobbyist was confirmed by the Senate as deputy administrator under Scott Pruitt in April and took over the EPA when Pruitt resigned in July. Although Wheeler’s time as acting administrator was initially limited to 210 days under a federal vacancies law, that clock gets paused if and when Trump nominates Wheeler for the head position, meaning he could stay as acting administrator for up to two years while the nomination is pending. (Bloomberg)

That was the old me – President Trump’s nominee to the US Federal Energy Regulatory Commission told senators Thursday he would preserve the agency’s independence if confirmed, despite previously helping craft a coal and nuclear bailout that FERC rejected early this year. According to Utility Dive, Bernard McNamee pledged to be an “independent arbiter” on FERC and to separate his decisions as a regulator from his previous role at the Department of Energy, where he worked on the bailout plan. He declined, however, to say if he would recuse himself from similar issues at FERC.

Pipeline pass – US federal regulators have declined to seek penalties for about 90% of interstate pipeline explosions since 2010, according to a new investigation from E&E News. Of the 137 fires or explosions over the past eight years, the news agency found that fines from the Pipeline and Hazardous Materials Safety Administration, which regulates interstate pipelines, have totalled just $5.4 million. This is less than a days’ worth of profits for Keystone XL owner TransCanada. (Climate Nexus)

Cheque, mate – Canada’s Yukon might not be sending rebate cheques from the federal ‘backstop’ carbon tax to businesses, but rather may give the companies tax credits, according to leaked documents obtained by CBC. While the territorial government has promised rebates to Yukoners once they start paying the carbon tax next July, meeting minutes from the “low carbon stakeholder committee” – comprised of several business organisations and trade groups – showed the government may prefer to gather data from these entities through corporate income tax filings and then rebate the money the following year as a tax credit. Opposition MLAs hit back at Premier Sandy Silver for withholding details about the carbon tax, while Silver said the documents prove the government is doing its job of consulting before deciding on how to distribute the rebates.

Join the fun – The Colorado Air Quality Control Commission on Friday voted unanimously to adopt California’s low-emissions vehicle standard, which the Trump administration is seeking to eliminate. For the time being, Colorado will join California and roughly a dozen other states in setting higher vehicle fuel economy standards for model years 2021-2026 set by California regulator ARB and the Obama administration in 2012. However, the Trump administration has proposed revoking California’s waiver under the Clean Air Act to set its own higher standard. (The Colorado Sun)

Gulping hot air  – Setting the right limits on international emissions trade could prevent most ‘hot air’ from nations transferring credits deriving from Paris pledges that already correspond to higher levels of emissions than independent projections, according to an article in the journal Climate Policy. Given the high stakes, the authors recommend governments consider several safeguards as well as such limits under Article 6 UN climate negotiations.

And finally… You spin me right round, baby – A spinning turbine that can capture wind travelling in any direction and could transform how consumers generate electricity in cities has won its inventors a prestigious international award and £30,000 ($38,500) prize. Nicolas Orellana and Yaseen Noorani, MSc students at Lancaster University, scooped the James Dyson award for their O-Wind Turbine, which takes advantage of both horizontal and vertical winds without requiring steering. Conventional wind turbines capture wind travelling only in one direction, and are notoriously inefficient in cities where wind trapped between buildings becomes unpredictable. Separately, an initiative that transforms air pollution into ink is turning heads in Asia. Developed by MIT Media Lab, AIR-INK is made out of captured air pollution particulate matter – namely the unburned carbon soot you see coming out of the exhaust pipe of cars, chimneys, generators, and more. It takes just 45 minutes worth of vehicular emissions to produce 1 fluid ounce of ink, which is enough to fill one of the pens being offered through the inventors’ Kickstarter campaign.

Got a tip? Email us at news@carbon-pulse.com

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