CP Daily: Monday October 19, 2020

Published 00:38 on October 20, 2020  /  Last updated at 00:47 on October 20, 2020  /  Newsletter  /  No Comments

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

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TOP STORY

China ETS set to start out with 8-8.5 billion allowances -analysts

China is likely to hand out 8-8.5 billion allowances for 2019 and 2020 when its emissions trading scheme eventually gets off the ground, starting off with a soft scheme that could be ramped up fairly quickly given the government’s recently announced climate ambitions, analysts said Monday.

EMEA

Poland’s PGE to quickly spin off coal assets under 2050 zero emissions plan

Poland’s largest utility PGE will spin off its coal assets into a separate company by the end of 2021 to help secure access to loans to build new renewables facilities, its CEO confirmed on Monday, unveiling plans to reach zero emissions in 2050.

EU Market: EUAs touch new 4-mth low below €25 as supply, COVID pressures persist

EUAs inched down to a new four-month low on Monday, as technical selling backed by supply- and pandemic-linked pressures held benchmark prices under €25 for a third straight session.

AMERICAS

Trump admin. appeal against California-Quebec ETS linkage won’t progress until late Dec.

The US Department of Justice’s (DOJ) appeal on constitutional challenges to the California-Quebec cap-and-trade linkage will not progress until shortly before Christmas, with the fate of the Nov. 3 presidential election set to weigh heavily on the case.

RFS Market: RIN prices bubble to one-month high on import buying

US biofuel credit (RIN) values rose to a one-month high at the end of last week on reports of fuel importers covering their Renewable Fuel Standard (RFS) obligations after booking shipments of European gasoline.

VOLUNTARY

CARBON FORWARD 2020: Voluntary developers bullish despite Paris-era warnings

(Updates to clarify that consultancy Perspectives advises buying “high legitimacy” carbon credits)

Voluntary carbon project developers are optimistic about their growth prospects, regardless of warnings that the onset of the Paris Agreement era may drastically shrink supply.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Face the facts(heet) – A “factsheet” published by China’s ministry of foreign affairs on Monday slammed the US’ environmental and climate record two weeks before the American election, describing the US as being “widely viewed as a consensus-breaker and a troublemaker”. It accused Washington of having “seriously undermined global climate governance and cooperation” for failing to ratify the Kyoto Protocol and withdrawing from the Paris Agreement, and lashed out at President Trump for calling climate change a hoax and undermining the multilateral order that underpinned climate policy progress in forums such as the G20. But the document suggested that even if former Vice President Joe Biden wins the election on Nov. 3, a Democratic administration would have to face up to the consequences of the US retreat from climate action. (Climate Home)

Working it out – The European Commission on Monday presented its work programme for 2021, confirming plans to update the whole EU climate legislative framework by June next year to make it fit for a bloc-wide 55% emissions reduction target by 2030. As expected, the Commission will review the EU ETS Directive to add in new sectors, “including maritime, aviation, and CORSIA, as well as a proposal for ETS as own resource” to finance the €750 bln recovery fund from the COVID-19 crisis. Check Carbon Pulse’s EU Legislative Guide and Calendar to stay up-to-date with all key dates.

Greener than green – The European Commission will unveil new EU-wide regulations this autumn to ensure that batteries manufactured or imported into Europe are “the greenest on this planet,” the Commission’s Vice President Maros Sefcovic told Euractiv. The new bloc-wide rules will aim to ensure that EU-made batteries use raw materials that are traceable and follow strict ecological and labour norms. Moreover, foreign battery manufacturers that fail to comply with the new rules will face a carbon border tax to ensure they do not undercut European makers. “We want to give our trading partners a choice: either you introduce carbon pricing at home, like we have done here in Europe with the ETS, or there will be a carbon adjustment mechanism to level up the price of CO2,” Sefcovic warned.

Kiwi control – After a thumping better-than-expected election win, New Zealand’s Prime Minister Jacinda Ardern said on Sunday that she would form a government within three weeks, but declined to say whether she would rule alone as her majority allows or form a coalition, Reuters reported. Ardern’s Labour won 64 of the 120 seats in the country’s unicameral parliament, which had little effect on New Zealand carbon allowance prices on Monday. Read Carbon Pulse’s take on what the election result could mean for the country’s ETS.

Sea capture – The OGCI coalition of oil and gas majors is eyeing up the potential to capture emissions from ships out at sea by teaming up with global tanker owner and operator Stena Bulk to evaluate the feasibility of technology. The move would extend member Saudi Aramco’s research, which it claims has successfully demonstrated carbon capture on board heavy-duty trucks on roads. (BusinessGreen)

Tree troop – UK conservation charity Woodland Trust plans to plant 50 million trees by 2025 in a bid to put the UK on track to meet its 2050 net zero emission target. The campaign will see the charity send more than 600,000 free trees to community groups and schools over the next few weeks. It also urged individuals to help the charity reach the tree planting goal by donating money or by lobbying the devolved governments of the UK to significantly raise their tree planting ambition. (BusinessGreen)

The loan and short of it – Roughly half of syndicated loans among major US banks – the large loans issued to one borrower from multiple lenders – are vulnerable to an economic shift away from carbon-intensive goods and industries, according to a new report from business sustainability group Ceres. Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, and Goldman Sachs are the top five US banks facing that transition risk, which envisions a scenario where new government policies make emitting GHGs prohibitively expensive, devaluing assets like fossil fuel reserves or sectors such as heavy manufacturing. Under that scenario, the banks would experience “substantial losses from direct exposure in the months following a major sentiment shift,” the report found, putting financial institutions that remain highly leveraged in emissions-intensive investments at risk of taking a hit. Losses in the fossil fuel and utility sector could amount to 3% of syndicated loans, though including climate-adjacent sectors such as real estate, heavy manufacturing, transportation, and agriculture could drive those losses up to 18%. (Politico)

Wholesale changes – Five states in the US Northeast are calling for changes to the region’s wholesale electricity market design, transmission planning process, and the governance of its grid operator ISO New England (NE ISO). In a “vision statement” released by the New England States Committee on Electricity (NESCOE) on Friday, the states call for a “regionally-based market framework” that meets their decarbonisation mandates, maintains resource adequacy at the lowest cost, and establishes mechanisms to accommodate existing and future long-term contracts for clean energy resources. The current system “has actively hindered our efforts to decarbonise the grid,” Connecticut Governor Ned Lamont (D), said in a joint statement with the governors of Maine, Massachusetts, Rhode Island, and Vermont. New Hampshire was the only NESCOE member to not join. (Utility Dive)

Shifting views – Americans are now nearly four times more likely to say they’re alarmed about the climate crisis than to be dismissive of it, the highest ratio since Yale University first began gathering data on American attitudes about climate change back in 2008. According to survey data collected in April and released Friday, more than a quarter of the US adult population now thinks global warming and its attendant consequences are alarming. That’s more than double the 11% who were alarmed back in 2015, and almost four times the 7% who currently say the climate isn’t changing. (Grist)

And finally… Just zap it – From the yellowed bottles in landfills to the jellyfish-like bags clogging the oceans, plastics pollution is an apparently intractable problem. Yet, chemists lament, it shouldn’t be. Within this waste there is something extremely useful, if only we could access it: hydrogen. Now a British team of scientists believes it has found a way to get at it, and do so cheaply, thanks to tiny particles of iron and microwaves. If their system works at scale they hope it could be a way of cheaply converting useless plastic into hydrogen fuel and carbon. (The Times, $)

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