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The Saskatchewan Court of Appeals ruled Friday that Ottawa has the authority to impose its ‘backstop’ CO2 tax and output-based pricing system (OBPS) on the province, upholding the legality of the Canadian federal government’s landmark climate policy.
RGGI allowance (RGA) prices dropped in early trading on Friday as market participants reacted to Virginia Governor Ralph Northam’s (D) decision to sign a budget proposal that bars the state’s participation in the northeast US carbon market.
Washington state Governor Jay Inslee (D) unveiled the first major climate policy announcement of his campaign for the US presidency on Friday, building on emissions reduction strategies that he pushed to varying levels of success during his state’s 2019 legislative session.
A summary of legislative and regulatory action on carbon pricing and clean energy at the US subnational level taken this week, including Maine’s governor unveiling a 100% clean energy bill, movement on New Hampshire’s legislative proposal to adopt the post-2020 RGGI Model Rule, the passage of new GHG reduction targets in Colorado, and the California state assembly signing off on an offset bill.
Analysts have raised their near-term EU carbon price forecasts as a result of the Brexit delay and as new EUA supply will be more spread out than previously thought.
EUAs clawed back above the €25 mark on Friday to limit losses for the week, as a reversal in slumping gas prices lent support amid a post-compliance lull.
New Zealand carbon allowances fell to 7-week lows in Friday trade as emitters were seen selling off permits to raise cash to pay the NZ$25/tonne fixed price option.
Closing prices, ranges and volumes for China’s regional pilot carbon markets this week.
BITE-SIZED UPDATES FROM AROUND THE WORLD
Distressed assets – British Steel has won approval from a French court to buy Vallourec/Ascometal’s ailing Ascoval steel mill in northern France, Reuters reports, a day after the UK government said it had lent the firm £120 million from the UK government to help it meet EU ETS compliance. British Steel said it plans to invest £40.7 mln in the facility as part of “ongoing plans to re-establish British Steel as a leader in the steel industry”, with the French local and central government matching that funding. The deal raises questions about the UK’s decision to provide the emergency loan to British Steel, which business minister Greg Clark said was an “exceptional” case to avoid placing the company under “significant financial strain”. Read Carbon Pulse’s article about the British Steel ETS bailout loan, including details on how the funding may avoid running into EU state aid infringement proceedings.
Taxing times – German chancellor Angel Merkel’s co-governing CDU party will not push to introduce a carbon tax in non-ETS sectors as part of ongoing negotiations around a domestic climate protection legislation, news magazine Der Spiegel reported on Friday. Party leader Annegret Kramp-Karrenbauer urged the tax proposal to be dropped from the party’s climate position paper as centre-right party chiefs were divided on the issue.
Arts and Crafts – President Trump officially nominated Kelly Craft, the current US ambassador to Canada, to be his next UN ambassador on Thursday, with a contentious confirmation process likely to follow. Her husband Joe Craft is an active player in Washington energy policy as CEO of Oklahoma-based coal empire Alliance Resource Partners. Craft stumbled in her first Canadian TV interview when asked about the Trump administration’s plan to pull out of the Paris climate accord, saying it was important to listen to “both sides” of the science on climate change. (Politico)
Credit comments – The US Internal Revenue Service (IRS) on Thursday issued a long-awaited request for comments on implementation of the heightened ‘45Q’ tax credit for carbon capture, utilisation, and storage (CCUS) projects agreed in Feb. 2018. The reformed credit allows eligible projects that sequester CO2 underground to receive up to $50 per tonne of carbon sequestered in 2026 and $35/tonne for enhanced oil recovery (EOR) projects. The deadline for comments is 45 days after the IRS posts this notice in its bulletin.
And finally… Financial alchemists – The Green Climate Fund can become a “completely unprecedented” tool to ramp up action on climate change in developing nations, allowing states, companies and communities to experiment more – as long as its coffers are refilled this year, its new head said Yannick Glemarec in his first interview since starting a month ago. He described the fund as the “financial alchemists of climate change”, because it can design funding to meet needs. (Thomson Reuters Foundation)
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