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California regulator ARB should not endorse its Tropical Forest Standard (TFS) next month because sector-based REDD offsets lack environmental and social integrity and fail to address the root causes of deforestation, a state senator said, potentially opening a bicameral rift over the already divisive issue.
China should set an absolute cap on carbon emissions from 2025 to ensure the nation meets its Paris goals, a government think-tank said in a report published on Wednesday, though observers expect resistance from the leadership on climate issues amid larger political and economical concerns.
South Korean carbon allowances hit a new record high on Wednesday as emitters continued to acquire whatever little volume was available in the market, although the afternoon’s government auction settled well below the secondary market.
German-based utility RWE slowed its hedging rate slightly over Q2 to leave it with a marginally lagged hedged position compared to recent years, it said in financial results Wednesday, giving a modestly bullish signal for EUAs.
EUAs slipped back below €27 early on Wednesday in volatile trade as a weak auction and bearish economic data dented sentiment.
California regulator ARB dished out over 3.1 million California Carbon Offsets (CCOs) this week in the second largest issuance of 2019, as the number of credits without invalidation periods climbed by over 10%.
California Low Carbon Fuel Standard (LCFS) futures contracts saw renewed activity this week as participants looked to move positions further out on the curve, ending a recent lull.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Mind your own business – Australia is showing up at the Pacific Islands Forum in Tuvalu with a A$500 million climate package but is rejecting calls from its neighbours to reign in its coal consumption and cut carbon emissions, Bloomberg reports. Coal is not going to make it into the communique from the meeting, and is a “red-line” issue for Australia, according to Alex Hawke, the minister for Pacific affairs.
Long-term play – A carbon trading system is better than a tax for steering Germany towards climate neutrality in the long run, German Chancellor Angela Merkel said Tuesday. “In the beginning, the effect is similar, but the precision in reaching the target is better with allowances”, as the exact amount available could be stipulated at any given moment. Her ruling CDU/CSU party is due to present its climate strategy next month, which is expected to extend carbon pricing to non-ETS sectors, facilitate the country’s coal phaseout, and help reach national emission reduction targets for 2030 and 2050. (Ostsee-Zeitung, Clean Energy Wire)
Thanks but no thanks – The Trump administration is readying a plan to end direct US federal regulation of methane leaks from oil and gas facilities, Bloomberg reports, even as some energy companies insist they don’t want the relief. A draft proposal from the EPA would prevent the government from directly targeting the potent GHG as it restricts emissions from oil wells and infrastructure, despite fears that time is running out to avert catastrophic consequences of climate change. The proposal threatens to undermine the oil industry’s sales pitch that natural gas is a climate-friendly source of electricity. Dozens of companies have made voluntary pledges to keep methane in check, and some have warned the Trump administration that federal regulation specifically targeting it is essential for natural gas to maintain that reputation.
Clean bonus – US carbon pricing and renewables mandates imposed primarily to tackle climate change can have health benefits from cleaner air that exceed economy-wide costs, according to a paper from researchers at MIT and the University of Washington. It found that the health co-benefit of current Renewable Portfolio Standards (RPSs) in the US Rust Belt is $94 per ton of CO2. For a cap-and-trade system in the same region, it found a co-benefit of $211 – far higher than most estimates of the social cost of carbon. (Environmental Research Letters)
Tree village – Burlington, Vermont city councillors this week approved a contract to sell carbon offsets from tree planting. The contract, which passed by a 7-4 margin, will see the city earn $135,000 over the next two years as marketer Urban Offsets aims to sell the resulting credits. According to the contract, Urban Offsets will prioritise selling the credits to non-profit organisations, education institutions, certified “B-corporations”, or public entities. (WAMC)
Join the club – The Public Utilities Commission of Nevada on Tuesday became the fourth state to join the Western Public Utility Commissions’ Joint Action Framework on Climate Change, first established in 2006 with California, Oregon, and Washington. The joint action framework affirms participating utility commissions’ shared commitments to reducing emissions, expanding clean energy, keeping energy rates low, improving energy system reliability, and sharing best practices for renewable and low-carbon energy technologies. The framework also includes steps that states will take to meet those goals, including researching the pros and cons of regional transmission markets as they impact ratepayers and resource efficiency, exploring the development and use of low-carbon energy power, and sharing analyses and ideas with one another. (Las Vegas Sun)
The message – There is no general recipe for a successful carbon pricing scheme, but its introduction should feature open and targeted communication, according to Germany-based think-tank Adelphi. Emphasis should be placed on the positive environmental effects to counter the negative connotation of the term ‘tax’. The researchers advise that good communication be tailored to stakeholders and internally consistent, messaging tested, revenue directed towards the goal of the policy, and concerns around fairness and carbon leakage convincingly addressed.
And finally… Just another billion or two – A decade-long University of Edinburgh satellite study shows 1-1.5 billion tonnes of carbon being emitted annually from a region in northern tropical Africa. The theory is that the emissions are caused by degraded soil from droughts or land-use change in the region, especially in western Ethiopia. Scientists say further study is needed to provide a definitive explanation. (Phys.org)
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