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TOP STORY
Incoming EU presidency will aim for 55% GHG target, says German economy minister
Germany is striving to ensure EU nations agree by year-end on a collective 2030 emissions target of 55%, the country’s economy minister told EU lawmakers on Thursday – a level representing the higher end of ambition currently under consideration.
EMEA
EU Market: EUAs crash 10% from session high as supply boost sees rally unravel
EU carbon prices tumbled to a two-week low on Thursday after buyers struggled to absorb extra auction supply and amid weakness in wider financial markets.
EU lawmakers urge leaders to earmark ETS revenues to the bloc’s budget
Members of the European Parliament’s environment committee are keeping pressure on EU leaders to use ETS funds to finance the bloc’s seven-year budget ahead of a key summit on Friday.
AMERICAS
NA Markets: RGGI rises to 14-month high as WCI allowances plod along
RGGI allowance (RGA) prices surged to a 14-month high on the benchmark contract this week with increased compliance buying on the secondary market, while California Carbon Allowances (CCAs) ticked up despite new COVID-19 restrictions taking effect across the state.
British Columbia eases this year’s LCFS target as it extends programme to 2030
British Columbia fuel suppliers will face a less stringent Low Carbon Fuel Standard (LCFS) benchmark in 2020 due to the coronavirus pandemic, but the sector will still see the transportation programme’s emissions reduction target double by the end of the decade, the province’s Ministry of Energy, Mines, and Petroleum Resources announced Wednesday.
Colorado LCFS feasibility study expected by end of the month
A Colorado government agency will likely finalise by the end of the month a study assessing how a transportation sector low-carbon fuel standard (LCFS) could help the state meet its enhanced GHG reduction targets, an official said Thursday.
INTERNATIONAL
Investors call on ICAO to deliver net zero aviation emissions goal with minimal offsetting
ICAO and national governments must set a long-term and binding GHG goal for global air travel ahead of COP26 next year, while countries should consider a market mechanism for afforestation and other measures in their net zero-aligned COVID-19 recovery plans, said a report from a UN-convened group of investors released Wednesday.
ASIA PACIFIC
US investment firm buys stake in Australian offset developer
A major US investment firm has bought a minority stake in Australia’s biggest developer of carbon offset projects, seeking to expand the firm’s activities and enter new markets.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Rigging up – A group of the world’s top oil companies, including Saudi Aramco, China’s CNPC, and ExxonMobil, have for the first time set goals to cut their emissions as a proportion of output, as pressure on the sector’s climate stance grows. But the target, set by the 12 members of the Oil and Gas Climate Initiative (OGCI), still means absolute emissions can rise as production increases. The OGCI goal is eclipsed by more ambitious plans set individually by the consortium’s European members, including Royal Dutch Shell, BP, and Total. (Reuters)
Picking losers – A BNP Paribas SA fund has gained 35% this year by wagering on winners in the renewable energy industry, and now its managers plan to bet against the losers. Ulrik Fugmann and Edward Lees will run a new long/short fund, allowing them to bet against companies that are getting left behind in the transition to greener forms of energy. The pair will start with $50 mln of assets under management, with the capacity for that to rise to $1 bln, Lees said in an interview with Bloomberg. The BNP Paribas Environmental Absolute Return Thematic fund, which started Wednesday, will “short companies that are either sitting with significant transition-risk assets or stranded assets, or indeed have technologies that are either outdated or insufficient to address climate change,” Fugmann said. “Those companies will go down over time.” The managers’ long-only BNP Paribas Energy Transition fund is outperforming 99% of its peers this year, they added. (Bloomberg)
Up for comment – Germany’s Federal Ministry for the Environment (BMU) has published the drafts of regulations implementing the country’s fuel emissions trading act. The states and organisations can comment on the draft regulations until Aug. 11. Reporting Ordinance 2022 regulates emissions reporting in fuel emissions trading for the period 2021-22, while the Fuel Emissions Trading Ordinance regulates the sale of emission certificates under the country’s domestic ETS for transport and heating (nEHS).
Back to basics – A US federal judge Wednesday reinstated an Obama-era rule meant to limit methane pollution from oil and gas extraction. The ruling is the latest in a series of setbacks for the Trump administration’s efforts to repeal the rule after it failed to undo it via the Congressional Review Act in early 2017 and a federal court threw out an attempt to delay implementing the rule in October of that year. The venting and flaring rule, also known as the methane waste rule, established leak detection and repair requirements for oil and gas extraction on federal lands. Judge Yvonne Gonzalez Rogers found the Trump administration failed to properly account for the repeal’s cumulative impacts on climate change and public health, especially in tribal communities, and “systematically ignored the basics of rulemaking and steamrolled over the [Administrative Procedure Act] and [National Environmental Policy Act] framework to advance certain special interests.” The ruling came just hours after President Trump weakened NEPA in order to speed up permitting for pipelines, power plants, and freeways. (Climate Nexus)
Here we go again? – A group of Northern California residents and businesses have filed a lawsuit against Pacific Gas & Electric (PG&E) for damages caused by the Oct. 2019 Kincade Fire, just a week after the utility emerged from a bankruptcy caused by a series of earlier wildfires. State investigators have not determined the cause of the Kincade Fire, but PG&E – which settled its previous wildfire liabilities and exited Chapter 11 bankruptcy earlier this month – has stated that it could face a $600 mln loss related to the blaze. The implications for PG&E will depend on the extent of damages plaintiffs are seeking, which are not specified in the lawsuit, according to Steven Weissman, a lecturer at the Goldman School of Public Policy, University of California, Berkeley. “If it’s just a few million dollars, then a company the size of PG&E can probably work its way around that. If it’s a multi-billion dollar suit, then it’s a very different story,” Weissman told Utility Dive.
Gap year – The US EPA on Thursday posted six additional pending requests for so-called “gap filling” retroactive small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS), bringing the grand total to 58 such requests for waivers for compliance years 2011 through 2018. The agency posted 52 gap filling requests last month, which observers believe are designed to sidestep a court ruling this year that vacated three previous SREs because the facilities in question had not received compliance relief from the EPA consistently in prior years. (DTN Progressive Farmer)
Logging off – Canada’s ambitious climate goals are threatened by a “logging loophole” that allows industrial logging to clearcut the carbon-rich boreal forest, unleashing emissions neither adequately counted nor regulated under current law, according to analysis released Thursday by Nature Canada, Environmental Defence Canada, and NRDC. The report calls on the Canadian environment ministry to stop undercounting industrial logging’s emissions and exempting them from regulation, to integrate the sector’s carbon output under the national Greenhouse Gas Pollution Pricing Act, to protect intact forests, and to prioritise Indigenous-led land management.
Soil sell – US farmer-owned cooperative Land O’Lakes and tech giant Microsoft have announced a multi-year strategic alliance to pioneer new innovations in agriculture and enhance the supply chain, noting that soils are largely absent from global carbon markets. The companies say they are working together to change that by developing a technology suite to help farmers improve their profit potential and generate new revenue in carbon markets. The new alliance will develop capabilities to quickly and effectively predict the carbon benefits of regenerative practices like no-till agriculture, precision nutrition management, and planting cover crops, ultimately helping generate soil carbon credits and connecting markets to sell certified offsets to buyers. (Successful Farming)
Consumer carbon – Consumer goods firm Procter & Gamble (P&G) said it will halve its Scope 1-2 emissions by 2030 and invest in nature-based projects to offset the rest. As part of the strategy, P&G will fund offset programmes that aid reforestation in Brazil, tree-planting in California and Germany, and protection of mangroves in Philippines, which are run by WWF, Arbor Day Foundation, and Conservation International, respectively. However, over 98% of P&G’s emissions come from its Scope 3 footprint in the products it sells, which are not covered by the new commitment. Separately, competitor Unilever announced it will begin adding carbon footprint labels to its packaging, as it works to achieve CO2 neutrality from all its merchandise by 2039 (Bloomberg, Editorials360).
Boreal baking – A record-breaking heatwave in Siberia would have been almost impossible without human-caused climate change, a study has found. The Russian region’s temperatures were more than 5C above average between January and June of this year. Temperatures exceeded 38C in the Russian town of Verkhoyansk on June 20 – the highest temperature ever recorded north of the Arctic circle. An international team of climate scientists, led by the UK Met Office, found the record average temperatures were likely to happen less than once every 80,000 years without human-induced climate change. That makes such an event “almost impossible” had the world not been warmed by GHGs, they concluded. (BBC)
Crossing the line – Indigenous people living in the Amazon have called for an immediate halt of Brazilian government plans to build a power line through the tropical rainforest without any consultation with those living there, in breach of human rights legislation, according to UK-based non-profit Christian Aid. Right-wing President Jair Bolsonaro’s government has claimed the survey is impossible due to the COVID-19 pandemic and so issued a construction permit without conducting a consultation with affected community members required by law or even informing them of the decision. More than 70 organisations that work with the Quilombola people have called this trampling of their rights and the destruction of the rainforest under the cover of the pandemic an outrage.
And finally… Run the jewels – Vodka and diamonds are being enlisted in the fight climate change, as both can be made by manipulating CO2 that’s been captured from the air, meaning their production could actually help stem global warming. The market for such products is promising enough that a group of clean-tech incubators is on the hunt for start-ups that can create them. New York University’s Urban Future Lab is working with Greentown Labs and Fraunhofer USA to help grow businesses that have figured out how to turn CO2 into luxury goods and more. The group’s “Carbon to Value Initiative” offers start-ups a home for initial development, access to venture capital, and manufacturing partners. Technology to produce goods from CO2 has been around for a while, but the products themselves have gained little traction because they’re more expensive than similar ones manufactured in traditional ways. The incubator group is hoping to change that by focusing on high-value items, as consumers may be willing to pay a premium for luxury goods that combat climate change. (Bloomberg)
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