CP Daily: Friday March 19, 2021

Published 00:13 on March 20, 2021  /  Last updated at 00:13 on March 20, 2021  /  Newsletter  /  No Comments

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

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TOP STORY

Three standards vie for eligibility in third round of CORSIA aviation offset scheme approvals

Three mainly forestry-related offset standards are seeking eligibility in the third round of applications under ICAO’s CORSIA aviation carbon trading scheme.

INTERNATIONAL

Latest carbon market ETF sees managed assets more than triple year-to-date

(Free read) – Total assets under management by the newest carbon market ETF have more than tripled since the start of the year, in a further sign of investors rushing to gain exposure in this burgeoning asset class.

AMERICAS

Canada could emerge as green hydrogen supplier for Japan, others -panel

Canada has the potential to become a net exporter of green hydrogen by sparking domestic demand through the development of bus and truck fleets and entering into cooperative agreements with countries like Japan, panellists heard at a virtual conference this week.

California carbon prices to hit $40 in 2030 as annual deficits grow -analysts

California Carbon Allowance (CCA) prices will more than double this decade as emissions reductions cannot keep pace with more ambitious cap-and-trade allowance budgets, analysts with a major US investment bank said Friday.

WCI auction volume for May sale surges 30% on higher consignment, unsold allowances

The California-Quebec Q2 cap-and-trade auction will include more allowance supply than the previous quarter due to the reintroduction of unsold carbon permits and higher consignment, according to an auction notice published Friday.

WCI emitters cut carbon holdings for sixth consecutive week, as speculators hold firm

WCI compliance entities slightly cut their California Carbon Allowance (CCA) holdings over the previous week, while speculators largely maintained their permits over the period, according to US Commodity Futures Trading Commission (CFTC) data published Friday.

US Carbon Pricing and LCFS Roundup for week ending Mar. 19, 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 in California and the US Department of Agriculture.

Carbon market veteran joins US-based offset developer C-Quest Capital

A carbon market veteran who co-founded a major offset investment group nearly two decades ago has joined US-based project developer C-Quest Capital, Carbon Pulse has learned.

EMEA

High EU carbon prices slowing down Poland’s energy transition, PGE warns

Higher EU carbon allowance prices risk putting coal-relying Polish energy companies in even further debt and derailing their investments in renewables, an official from the country’s largest utility said Friday.

EU Market: EUAs sink to one-week low, notch 2.1% weekly dip despite new record

EU carbon prices slipped to a one-week low near €41 on Friday, as speculators took profits following another fresh all-time high, wider markets fell, and European power generation margins worsened.

ASIA PACIFIC

China traders’ association moves to tighten quality in carbon neutral bond market

The China interbank market dealers’ association has released new guidelines for issuers of carbon neutral bonds, seeking to root out dodgy practices in the emerging market.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Carbon Pulse has teamed up with CME Group to provide its clients with regular updates on the global carbon markets. Check out these briefs for the latest insights on pressing trends and events impacting markets, published every other week. Registration required.

AMERICAS

Judgment day – Canada’s Supreme Court says it will issue its ruling on the fate of the national carbon pricing strategy on Mar. 25, in a judgement that is expected to determine the fate of the central pillar of the Liberal government’s climate change plan. In the aftermath of Canada enforcing its ‘backstop’ CO2 levy on fossil fuels and output-based pricing system (OBPS) on recalcitrant provinces in 2019, the conservative-led provinces of Saskatchewan, Ontario, and Alberta all went to court to argue the Liberals’ Greenhouse Gas Pollution Pricing Act was unconstitutional because Ottawa was stepping into provincial jurisdiction. Appeals courts in Saskatchewan and Ontario in 2019 determined the policy was constitutional, while in Feb. 2020 the Alberta Court of Appeal said it was not. The cases were all appealed to the Supreme Court, which heard the cases together in two days of hearings last September. (Canadian Press)

NAAQS attack – Climate advocates have renewed hope for an ambitious US federal rule to limit GHG using the same type of mechanism that penalises states for exceeding air pollution thresholds, E&E News reports. The Clean Air Act sets national air quality standards to lower pollutants that cause smog, acid rain, and other health dangers. It’s never been used for GHGs, but environmental groups now hope EPA might finally use it after ignoring the option for 11 years. The Centre for Biological Diversity and 350.org initially petitioned EPA in December 2009 to use the landmark environmental law to set National Ambient Air Quality Standards, or NAAQS, for GHGs. Doing so could potentially open the door for a more ambitious and all-encompassing climate programme than EPA achieved under former President Barack Obama, as it would require states to hold their climate-warming emissions to a specific level.

Not ready to com-Mitt – Utah Senator Mitt Romney is “interested” in passing a carbon tax to address climate change, making him the most prominent active Republican in Congress to consider the policy. Romney is not quite ready to introduce or sign on to a specific bill, but he told the Washington Examiner in a recent interview that he is seriously considering and reviewing the merits of a carbon tax that would return the revenue to taxpayers. Specifically, Romney said he is enticed by a proposal developed by former Republican Secretaries of State James Baker and George Shultz as part of the Climate Leadership Council that would impose a carbon tax beginning at $40 per tonne, increasing 5% every year, and return the revenue to households through equal quarterly payments.

No longer a pipe dream – The US Federal Energy Regulatory Commission included an official assessment of a pipeline’s GHG in its evaluation of a proposed project on Thursday. Two Democrats – Chair Richard Glick and Allison Clements – and former GOP Chair Neil Chatterjee voted over the objections of the two other Republican commissioners to approve a relatively minor 84-mile gas pipeline replacement project. The trio found the project would not cause a significant increase in new emissions. The two Republicans opposed approving the project because they objected to the consideration of GHG impacts, while both sides of the majority saw the determination as a strategic victory. Glick has pushed for greater consideration of climate change in FERC’s considerations, while Chatterjee saw an opportunity to get Glick on the record approving a gas pipeline project. (Climate Nexus)

Partying like it’s 1949 – Coal dropped to the lowest proportion of US electricity generation since 1949, but the US Energy Information Administration doesn’t expect it to last. US coal-fired electricity generation fell to 774 mln MWh in 2020, dipping below natural gas- and nuclear-powered generation, according to an EIA analysis released Thursday. According to the EIA, low natural gas prices spurred lower utilisation of remaining coal capacity. With natural gas prices expected to recover this year, the EIA anticipates that coal generation will rebound for a time, but the source will then begin a slow decline through 2050. (Utility Dive)

ASIA PACIFIC

Throwing money at it, part I – Japan’s Oil, Gas, and Metals National Corp. and Mitsubishi and Indonesia’s Bandung Institute of Technology and ammonia initiative Panca Amara Utama (PAU) have signed a memorandum of understanding (MOU) to work together on a feasibility study on potential CCS and CO2 utilisation at PAU’s ammonia plant in Central Sulawesi, the parties announced Friday. The project will hope to carve out a path to capturing carbon emissions from the ammonia production process, and then transport that to Japan to use for energy.

Throwing money at it, part II – Another major Japanese company, Sumitomo, on Friday said it had signed an MOU with Australia’s port of Gladstone, the local city council, Australian Gas Networks, and the Central Queensland University to conduct a joint study on establishing Gladstone as a hub for production and export of hydrogen. Japan is ramping up efforts to deploy hydrogen in its domestic energy market, while Australia has plans to establish itself as a ‘hydrogen superpower’.

EMEA

Batteries under scrutiny – EU environment ministers expressed concern Thursday that the European Commission’s sustainable battery proposal sets unworkable targets and deadlines and would increase bureaucratic costs for battery producers, raising the prospect that the legislation will require significant changes before entering into law. The EU proposed to set a minimum share of recycled cobalt, lithium, nickel, and lead that must be used in batteries produced in Europe from 2030. The proposal would also make the environmental effect of batteries more transparent, forcing producers to flag the carbon footprint of each battery from 2024. While the objective of a more circular approach to batteries was widely welcomed by member states, some environment ministers raised fears that moves towards harmonised standards simply glossed over the differences in capacity among EU countries. (Euractiv)

INTERNATIONAL

CBD TBD – The UN Convention on Biological Diversity (CBD) on Friday said in a statement that COP15, the biggest biodiversity summit in a decade, had been moved to October due to delays related to the COVID-19 pandemic. The negotiations in Kunming, China had been scheduled for May after they were moved from Oct. 2020. Countries are expected to reach an agreement over targets to protect the natural world, including proposals to conserve 30% of the world’s oceans and land by 2030, introduce controls on invasive species, and reduce plastics pollution. (The Guardian)

AND FINALLY…

Friday feeling – Youth climate movement Friday for Future returned to the streets and the screens today after a coronavirus-induced break. “No more empty promises” is their rallying cry, in a mix of physical and digital protests planned in more than 700 locations in 50 countries. In Germany, protests will include bike demonstrations, small sit-ins, and online art and photo stunts, all in the run-up to this autumn’s election. The diverse and youthful cohort contrasts sharply with the old boys’ club running global climate diplomacy. A spokesperson for one of these power-brokers — US climate envoy John Kerry — told us he was aware of the “tragic irony” that his generation was passing on a climate in such poor shape to their grandchildren. (Politico)

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