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TOP STORY
EU Market: EUAs rebound to new high above €40 after intervention panic fades
EUAs rebounded to hit a new record above €40 on Friday, clawing back ground lost late yesterday and this morning as traders dismissed the prospects of regulators curbing speculative trade anytime soon.
AMERICAS
Key California agency heads, IEMAC members to discuss cap-and-trade improvements next week
Two California environmental agency officials and a pair from an independent market watchdog group will discuss improvements to the state’s WCI-modelled cap-and-trade programme at a Senate oversight hearing next week, but some advocates are seeking to delay the meeting, regulatory sources said.
WCI speculators add current vintage length in front of February auction
Financial entities continued to ramp up their California Carbon Allowance (CCA) holdings ahead of next week’s WCI auction, as regulated entities cut their holdings amid rising secondary market prices, according to US Commodity Futures Trading Commission (CFTC) data published Friday.
US Carbon Pricing and LCFS Roundup for week ending Feb. 12, 2021
A summary of legislative and regulatory action on carbon pricing, clean fuel standards, and clean energy at the US subnational and federal level this week, including developments in Oregon and Massachusetts.
EMEA
Carbon pricing will support Balkan coal phaseout, report finds
Introducing carbon pricing across the six Western Balkan nations will support a coal power phaseout “within a reasonable timeframe”, despite lingering coal subsidies and expansion plans, a report showed on Friday.
ASIA PACIFIC
Australia Market Roundup: Shell, Terra Carbon projects collect ACCUs as fossil lobby embraces net zero
Australia’s Clean Energy Regulator has released a second batch of carbon credits this week with Shell and Terra Carbon projects among the beneficiaries, while the nation’s lead oil and gas industry lobby group on Friday embraced a 2050 net zero emissions target with broad access to offsets.
INTERNATIONAL
New cattle feed ingredient can boost carbon credit generation four times higher -study
A methane inhibitor given to cattle can reduce methane emissions by up to 80% and increase the supply of carbon offsets from related protocols, according to a new study released Friday.
COMMENT
Brussels gets twitchy about EU ETS speculation
EUAs endured a boisterous day on Thursday, first reaching a new record of €40.12 and then plunging more than 3% in the last 20 minutes on news the European Commission was considering limiting speculative positions. It’s not the first time the Commission or member states have reacted to price volatility in the market, and I’m sure it won’t be the last. But something doesn’t quite add up here.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
INTERNATIONAL
Tariff talk – Canadian PM Justin Trudeau’s government is examining the merits of carbon tariffs, as his UK counterpart Boris Johnson wants G7 countries to discuss the idea of carbon border adjustments on imported goods. Trudeau’s trade chief Mary Ng said in an interview with Bloomberg on Wednesday that the Canadian government is “working on” the idea, as part of broader efforts to find areas where economic goals align with climate change objectives. “One has to look at it,” the minister said of Johnson’s efforts to forge an alliance on the issue. “My overarching answer to this is that we’re always going to be looking at it from the interests of Canada and to create that competitive advantage where it is.”
AMERICAS
Down a notch – S&P Global has lowered its credit ratings for US oil majors Exxon Mobil, Chevron, and ConocoPhillips, as the ratings agency highlights the challenges to oil majors posed by climate change. S&P warned earlier this year that oil explorers risked downgrades due to heavy levels of debt and the coming transition away from fossil fuels. The latest downgrades reflect “growing risks from energy transition due to climate change and carbon/GHG emissions, weak industry profitability, and greater expected volatility in hydrocarbon fundamentals.”
Taking responsibility – Chairman of the US Federal Energy Regulatory Commission (FERC) Richard Glick on Thursday said the panel will create a senior position on environmental justice to make sure new energy projects, such as pipelines and LNG facilities, do not unfairly harm minority communities. While the panel is required to consider green justice issues under the National Environmental Policy Act, Glick said in recent years it has not always emphasised its responsibility. Glick said FERC would be spending more time considering whether fossil fuel projects would expose nearby residents to a lot of particulate pollutants such as nitrogen oxide, and added the body should consider whether pollution impacts on communities could be mitigated by moving the projects or installing more pollution controls. (Reuters)
Sustainable Siemens – Siemens Energy has announced a series of measures to promote sustainable development and gradually eliminate GHG emissions from its Brazilian operations by 2030. The German-based company has created an internal investment fund for CO2 neutralisation projects, which will be fed back based on the pricing of emissions from its activities in the country. Within the scope of Siemens’ internal carbon pricing, each business area will contribute to the fund with a value proportional to the emissions of its operations at US$40/tonne. In addition, energy efficiency solutions are being implemented at company’s locations, such as the use of renewable energy at its headquarters in Brazil and the gradual replacement of the use of polluting fuels with alternatives that are less harmful to the environment. (CanalEnergia)
What’s your Engle? – Climate Finance Partners (CLIFI), the sub-advisor to the KFA Global Carbon Exchange Traded Fund (ticker: KRBN), announced Thursday that Robert Engle has been named chairman of the Climate Finance Partners Advisory Board. Engle is the 2003 recipient of the Nobel Prize in Economics and a pre-eminent expert in volatility measurement within financial markets. He replaces John Kerry, who left the group to become President Joe Biden’s (D) international climate ‘czar’. KRBN is the first US-listed ETF to combine the largest carbon markets – the EU ETS, WCI, and RGGI – into a single investable fund, with pricing based on a weighted average of benchmark allowance futures in the world’s most liquid, accessible, and mature cap-and-trade schemes.
EMEA
Room for gas – The EU’s mammoth post-pandemic recovery fund, which is intended to exclude projects that worsen climate change or harm the environment, could in some circumstances be used for investment in gas, the European Commission said. The Commission on Friday published guidelines to help countries assess whether their spending plans do no significant harm to efforts to curb climate change and protect biodiversity, among others. However, “limited exceptions” can be made for natural gas projects “on a case by case basis”. (Reuters)
Colour-blind H2 – It is critical that EU legislation on hydrogen is colour-blind, Polish Climate Minister Michal Kurtyka told Euractiv in an interview. Poland’s ambition is to have 2 GW of electrolyser capacity for renewable hydrogen installed by 2030, but as the country wants to increase gas capacity to shift away from coal, Kurtyka said the EU must “not discriminate between different types of hydrogen”.
AND FINALLY…
Musk you insist? – Elon Musk, CEO of Tesla and SpaceX, revealed that he approached the Biden administration about implementing a carbon tax, but that the new government wasn’t really receptive. In a new episode of Joe Rogan’s podcast, Musk revealed that he while he pitched the idea of CO2 tax, the response he got was that the policy was “too politically difficult”. Musk suggested that the tax be applied at the point of consumption, especially for electricity and gasoline, but he also suggested making it a non-regressive tax so as not to affect low-income people. (Electrek)
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