CP Daily: Wednesday December 16, 2020

Published 01:20 on December 17, 2020  /  Last updated at 01:20 on December 17, 2020  /  Newsletter  /  No Comments

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

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TOP STORY

Washington governor restarts pursuit of cap-and-trade, LCFS programmes

Washington Governor Jay Inslee (D) on Tuesday outlined his climate policy package for the 2021-23 legislative session, teaming up with Democratic lawmakers to pursue emissions trading and low-carbon fuel standard (LCFS) proposals that have repeatedly fallen short in the state in recent years.

EMEA

EU Market: EUAs pull back after hitting fresh record of €32.50, as more investors enter market

EUAs extended their record high for a fourth straight day on Wednesday amid buoyant financial markets, bullish technicals, and data showing record investor interest, before profit-taking pulled prices back.

CORRELATIONS: EUA, coal price ties strengthen during dual rallies

The correlation between EU carbon and coal prices has strengthened in recent days as both have rallied on a mix of higher demand and constrained supply.

INTERNATIONAL

NGO call to end use of international offsets meets with resistance

An NGO proposal to replace international offsetting with climate finance in order to avoid double claiming has been met with resistance from some in the voluntary carbon market, who fear a lack of corporate interest.

S&P Global Platts to launch CORSIA offset price assessment

Commodity price reporting agency S&P Global Platts on Wednesday announced it will begin assessing prices for carbon credits approved for use in ICAO’s global aviation offset system CORSIA, as interest in the voluntary market grows.

BP acquires majority stake in US offset developer Finite Carbon

Oil major BP has acquired a majority stake in carbon offset developer Finite Carbon, deepening its interest in the forestry-focused company and targeting a major expansion internationally.

ASIA PACIFIC

Government-commissioned report clears ground for Taiwan carbon tax

Taiwan should introduce an economy-wide carbon tax of around $10/tCO2e that could transition to an emissions trading scheme over time, according to a report commissioned by the Taiwan EPA, just before the agency is expected to publish a proposal to adjust the country’s 2015 GHG Reduction Act.

Japan minister pushes for doubling renewables target

Japan should aim for getting more than 40% of its energy from renewable sources by 2030, around double the current government target, according to Environment Minister Shinjiro Koizumi, who is also backing a domestic price on carbon.

Senior carbon trader leaves NZ energy firm

A veteran emissions trader has left one of the biggest emitters participating in New Zealand’s carbon market.

AMERICAS

British Columbia sets 2025 GHG reduction target, though 2030 goal further off track

The British Columbia government on Wednesday announced a new interim emissions reduction target for 2025 to help the province reach its medium- and long-term climate goals, although an accompanying report shows more work to be done to hit the 2030 target.

RFS Market: RIN prices approach year high as market awaits 2021 quotas

US biofuel credit (RIN) values edged toward a new 2020 high on Wednesday as the EPA prepares to publish next year’s long-delayed Renewable Fuel Standard (RFS) quotas by the end of the month.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

New plan – Papua New Guinea has become the latest country to submit an updated NDC to the UN, promising to cut GHG emissions from deforestation and forest degradation from agricultural expansion and commercial logging by 10 MtCO2e by 2030, compared to 2015 levels. It also said it would reduce the area of forest degradation by 25% over the same time period, in part through promoting REDD+.

No plan – Despite growing awareness of pressure to slash GHG emissions, Australia’s resources companies are falling short in designing strategies for how to address a decarbonising world, and are also not setting out plans for reducing their carbon output, found a new report from ClimateWorks, as reported by RenewEconomy.

Not for everyone – This year has seen global momentum grow for the financial industry’s planned exit from coal, and while that’s mostly welcomed, it isn’t always the case. In Australia, the government is launching an inquiry into why banks and regulators are pulling back on lending and insuring to mining projects amid fears of the impact it might have on the domestic fossil fuel industry. (Sydney Morning Herald)

Uncharted waters – Representatives from the 54 signatories of the Energy Charter Treaty – a multilateral agreement on cross-border energy investments – are meeting on Wednesday and Thursday to reach common ground on the reform of the little-known treaty. One of the EU’s key objectives in the negotiation is to align the charter with the Paris Agreement and scrap the special protection granted to fossil fuel investments. EU lawmakers, environmental groups, and renewable energy associations alike have called on the 27-nation bloc to withdraw from the treaty if the ECT does not scrap its fossil fuel support. (Euractiv)

Citizens for climate – The European Commission on Wednesday kicked off the European Climate Pact, an EU-wide initiative inviting people, communities, and organisations to participate in climate action. The Commission’s climate chief Frans Timmermans presented the Climate Pact in a launch event with former UN climate chief Christiana Figueres and the 2016 Formula 1 world champion Nico Rosberg, among other guests. The Climate Pact will join forces with global climate campaign Count Us In to mobilise EU citizens to take concrete steps to reduce their carbon pollution and catalyse rapid action from leaders.

Gives you wings – The UK supreme court has overturned a February judgment that a third runway at London’s Heathrow airport was illegal and the project can now seek planning permission, even though the ultimate completion of the runway remains uncertain. The February decision was seen as historic by environmental campaigners, as it was the first significant ruling in the world to be based on the Paris Agreement, and related cases were subsequently brought against plans to build more roads and gas-fired power plants in the UK. Last week, the government’s climate advisors said there should be no airport expansion unless emissions from flights could be reduced to compensate. Even PM Boris Johnson has opposed the runway, saying in 2015 that he would “lie down in front of those bulldozers and stop the construction”. (Guardian)

Fed joins – The US Federal Reserve has become one of eight new members to the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), an international group of central banks supporting the international climate targets and focusing on climate change risk. For years, the bank has stayed on the sidelines on the issue, though last month for the first time the Fed included climate change in its regular assessment of financial stability vulnerabilities. (FT)

Nothing’s shocking – A new Princeton University-led analysis concludes there’s a range of economically beneficial and technologically feasible options for the US to reach net zero emissions by 2050, but big investments and supportive policies would need to begin now. The analysis envisions $2.5 trillion in “additional capital investment into energy supply, industry, buildings, and vehicles over the next decade relative to business as usual.” However, the researchers found the country’s total annualised energy expenditures would increase by less than 3% over the 2021-30 timeframe. Overall, “the cost of oil shocks exceed the costs of this net-zero transition,” Princeton University assistant professor Jesse Jenkins, a co-author, told reporters. (Axios)

Hydrogen reliance – A strong Canadian hydrogen sector will require C$5-C$7 bln in public and private investment over the next five years and will largely rely on hydrogen derived from the country’s vast natural gas reserves, according to a new federal government strategy. The long-awaited Hydrogen Strategy for Canada, released Wednesday by Natural Resources Minister Seamus O’Regan, sets the stage for the development of a robust domestic hydrogen market that Ottawa hopes could be worth C$30 bln and create 350,000 jobs by 2050. But the strategy’s focus on hydrogen derived from natural gas – not renewables – will likely draw the ire of some environmental groups, who argue promoting so-called ‘blue’ hydrogen amounts to subsidies for the oil and gas sectors. (Globe and Mail)

Shipped out – The consensus for an effective carbon price for the maritime sector appears to fall somewhere in the $100 to $150 per tonne CO2e range, according to a paper by Channoil Consulting in collaboration with Gibson Shipbrokers, offering analysis of shipping’s route to 2050 and crunching the numbers of fuel prices. It thinks it unlikely that a carbon price in the EU ETS would move high enough to support the introduction of biofuels at any significant level for marine use and that the sector would require its own separate approach. (Splash)

Eye in the sky – Satellite data could play a role in monitoring, reporting and verifying compliance with emissions trading systems also known as cap and trade, Stephanie La Hoz Theuer, a member of the International Carbon Action Partnership (ICAP) Secretariat, said at the virtual American Geophysical Union fall meeting. Currently, 21 ETS’ are operating, with another 24 either under consideration or in the process of being established, La Hoz Theuer said. However, to date satellite data has not been widely applied to the task of supporting those systems. “The current use of satellite data is happening primarily in New Zealand and California and in the sector of forestry,” La Hoz Theuer said, adding other jurisdictions are interested in learning whether satellites could provide useful data particularly in the area of offsets related to forestry. (Space News)

Hy in the sky – Aviation firm ZeroAvia has secured £12.3m in UK government funding to deliver a breakthrough 19-seat hydrogen-electric powered aircraft that is market-ready by 2023. The grant for the HyFlyer II project will see ZeroAvia develop a certifiable hydrogen-electric powertrain that can power airframes carrying up to 19 passengers. To do this, it will collaborate with two partners – the European Marine Energy Centre and Aeristech. The company has also secured over $21 mln from backers including the Bill Gates-led Breakthrough Energy Ventures, Amazon, and Shell.

And finally… Eighteen and up – Emissions may have warmed the planet 18% more than previously thought, “raising the prospect of the world having less time than expected to meet the goals of the Paris Agreement”, according to New Scientist. The article is based on a new paper from scientists at the UK Met Office, which brings the world’s three key temperature datasets “in line” and suggests the temperature increase so far is towards the upper end of previous ranges. According to the magazine, the global temperature is thought to have increased around 1.07C since pre-industrial times, up from a previous estimate of 0.91C. (Carbon Brief)

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