CP Daily: Wednesday July 28, 2021

Published 01:26 on July 29, 2021  /  Last updated at 01:35 on July 29, 2021  /  Newsletter  /  No Comments

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

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TOP STORY

Brussels publishes 5-year national EUA allocation tables after months of delay

The EU on Wednesday released its national allocation tables determining free carbon allowance allocations for 2021-25 after several months of delays, revealing quotas of permits to be given to emitters in most of the countries participating in the EU ETS.

EMEA

Euro Markets: EUAs, UKAs rise amid energy gains as market absorbs UK auction

Carbon on Wednesday consolidated its gains from earlier in the week, as a strong auction result and firm energy prices bolstered sentiment ahead of the annual reduction in auction supply.

Norway’s Equinor defends oil output hike plans as analysts question ambition

Norway’s Equinor on Wednesday defended its plans to extract more oil and gas, fending off analyst questions about whether the company risked legal action over a lack of climate ambition.

Wizz Air flags summer rebound after pandemic, slams EU’s jet fuel tax plans

Hungary-based airline Wizz Air expects its passenger capacity to reach pre-pandemic levels this summer, it said on Wednesday while criticising Brussels’ proposals for an EU-wide tax on jet fuel.

UK government consults on technical fixes to ETS legislation

The UK government has opened a consultation into proposed amendments to its emissions trading legislation in order to correct “outstanding technical issues identified during the development and legislation of the scheme”.

ASIA PACIFIC

Chinese provinces to pilot CO2 assessment in new project approvals

Seven Chinese provinces will pilot a system that requires governments to take CO2 emissions into account when approving new projects in energy-intensive industries, most of which are on the list to be brought into the national emissions trading scheme.

Oil and gas majors stoke Australian offset demand, analysts say

Large oil and gas companies are behind most of the recent increase in demand for Australian carbon credits, which has seen prices rise by more than a quarter this year, according to analysts.

AMERICAS

California grants 1 mln new offsets, as wildfires near another forestry project

California minted almost 1 million new compliance-grade offsets over the past two weeks, but these issuances came as a new West Coast wildfire appeared to impact another existing forestry project registered under the WCI-linked cap-and-trade programme, state data and researchers reported this week.

RGGI speculative firm opens new account, eyes California offset market

A Texas-based hedge fund opened a RGGI CO2 Allowance Tracking System (COATS) account on Wednesday, with the firm having been linked to two previous speculative accounts under a different name.

VOLUNTARY

REDD developer Biofilica targets tenfold carbon credit growth following merger

Brazilian offset developer Biofilica announced its acquisition by a multinational environmental management firm on Tuesday, with the purchase aimed at generating 10 times as many voluntary emissions reductions (VERs) compared to current volumes and expanding into more nature-based project types.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

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INTERNATIONAL

Deliverance duo – Canadian environment minister Jonathan Wilkinson has accepted an invitation from UK COP26 President Alok Sharma to co-lead a process to further build trust that developed countries stand by their commitments and deliver on the US$100 bln climate finance goal through 2025. Minister Wilkinson and German State Secretary Jochen Flasbarth will lead the development of a plan in the lead-up to COP26 UN climate summit in collaboration with the COP Presidency.

AMERICAS

Vehicle values – President Joe Biden’s administration will as soon as next week propose rules increasing federal tailpipe GHG standards by ramping up annual targets through model year 2026, the AP reports, citing auto industry and government officials. (Politico) Specifically, the AP said the joint EPA-NHTSA rules will apply the standard adopted in California’s 2019 deal, around 3.7%, starting with 2023 vehicles. That will ramp up through 2025 to roughly Obama-era 5% improvements, and in 2026 go even higher, potentially up to 7%. The EPA also seems poised to revive extra credit granted for electric vehicle sales, the AP said, which automakers say will boost EV adoption but that environmentalists argue waters down the programme and obscures emissions from gas guzzler sales. (Politico)

Closer on disclosure – The top US financial regulator said on Wednesday it may require publicly traded companies to report on GHG emissions by suppliers and partners, as part of an expected climate risk disclosure rule. US Securities and Exchange Commission Chair Gary Gensler said the rule would likely be influenced by existing international standards but would be “appropriate” for American markets. Gensler said he expects to propose the new rule by year end. (Reuters)

What a waste – Mexico’s methane leak rate from oil and gas operations is twice as high as that of the world’s top oil producer, the United States, a group of researchers found in a report due to be released this week. To blame for Mexico’s poor record are mostly high emissions at midstream facilities that gather, compress, and process the gas, Environmental Defense Fund (EDF) said. Another culprit is venting, the practice of releasing gas from oil wells without capturing it. A third source is flaring, or burning gas at the wells. Roughly 4.7% of gas produced in the country is released into the atmosphere – by global standards a very high leak rate. The Mexican results compare with a rate of 2.3% for all of the US and 3.7% in the Permian basin. Reuters was unable to determine whether the problem has improved or worsened under Mexican President Andres Manuel Lopez Obrador, who took office at the end of 2018. But the study estimates 1.3 Mt of methane is wasted in Mexico per year, about one third of the nation’s natural gas imports and equivalent to $200 mln.

Brookfield bucks – Toronto-based Brookfield Asset Management on Tuesday closed $7 bln for its Global Transition Fund that aims to scale clean energy and help carbon-intensive industries cut emissions. The fund, with founding partners Ontario Teachers’ Pension Plan Board and Singapore-based investment heavyweight Temasek, has a cap of $12.5 bln. (Axios)

Canary in the canola mine – The Alberta government is supporting Canary Biofuels, an Alberta-based biofuel producer, with a C$4.7 mln grant through the province’s Technology Innovation and Emissions Reductions (TIER) fund. In total, the facility in Lethbridge County will cost C$28.6 mln and will be capable of producing roughly 70 mln L of renewable fuel each year while cutting more than 220,000 tonnes of emissions. The plant plans to purchase more than C$375 mln worth of feedstock from Alberta farmers over the next five years. (CTV News)

EMEA

Help for H  – The UK government is considering adding a new levy to household gas bills as a subsidy to hydrogen producers in a bid to boost the fledgling industry. The government is set to publish its long-awaited hydrogen strategy next week, which will set out ways to increase the use of the gas as a part of the UK’s plan to reach its 2050 net zero emissions target. Part of the plan will be a consultation on a new mechanism, similar to contracts for difference used in the energy sector, to ensure that hydrogen companies can receive a predictable price for future sales. (FT)

Mandate moves – A cross-party group of UK MPs has joined a growing chorus of calls from think-tanks, former ministers, and climate advisers for the British government to introduce a zero-emission vehicle (ZEV) mandate. The transport select committee say to boost supply and demand of electric cars there should be regulatory requirements for carmakers to sell a minimum proportion of these vehicles which increases over time, or to purchase credits from other manufacturers if they cannot reach the targets. The government’s transport decarbonisation plan published earlier this month included plans to hold a consultation over potentially introducing a ZEV mandate. (BusinessGreen)

Dismantling justice – The British High Court has agreed to hear a case by environmental campaigners claiming that the UK government’s support of North Sea oil and gas companies conflicted with its net zero plans. The legal challenge revolves around tax breaks oil and gas producers receive in order to help cover decommissioning costs. The UK Oil and Gas Authority said in a statement its strategy “which includes net zero requirements on industry, is its primary tool” to hold industry to account on emission reductions. Shell and BP paid no paid no UK taxes in 2019 due to decommissioning tax relief. (Reuters)

Guinea NDC – The Republic of Guinea is the latest country to submit an updated NDC under the Paris Agreement. The West African nation has pledged to unconditionally cut its GHG emissions by 9.7% below BAU levels by 2030. The government added that with international assistance estimated at $13.8 billion, the country could achieve a 17% cut in that timeframe. The NDC forecasts that national emissions will rise under a BAU scenario from 11.8 Mt in 2018 to 12.9 Mt in 2020, to 17 Mt in 2025, and then to 23.2 Mt in 2030.  The unconditional and conditional goals translate into 2030 targets of 21.1 Mt and 19.2 Mt respectively.  Guinea also reiterated its interest in tapping international carbon markets to help achieve its objectives. The LDC previously pledged to cut its emissions by 13% below BAU by 2030 at an international aid cost of $8.2 bln just for funding adaptation and the decarbonisation of the energy sector.

ASIA PACIFIC

Canberra call-up – European, British, and American diplomats have met up to three times in Canberra over recent months to discuss how to encourage Australia to consider stronger cuts to its GHG emissions ahead of November’s COP26 summit, The Guardian reported, citing unnamed diplomatic sources. In addition to pursuing engagement with the Australian government, possible options include outreach to business associations and farming groups.

VOLUNTARY

Biochar offsets – The Climate Action Reserve is launching the development process for a biochar offset protocol. Biochar production provides an opportunity for the productive use of a variety of feedstocks that are otherwise considered waste biomass, including non-merchantable residues from timber harvests and fuel thinnings. Funding support for the protocol development is provided by a Wood Innovations Grant from the USDA Forest Service and a Forest Health Grant from CAL FIRE as part of the California Climate Investments Program. The development of the protocol will be accompanied by a market analysis evaluating the potential scale and anticipated demand for biochar credits and several pilot projects to test viability of offset project requirements. Protocol development is expected to be completed in the summer of 2022. CAR is hosting a biochar protocol V1.0 kickoff webinar on Thursday, Aug. 12. Register here

SCIENCE & TECH

For its game-changing solution to extract CO2 from seawater and sequester it in carbonates, cleantech firm SeaChange won over judges at The Liveability Challenge 2021 to clinch the top place at the global sustainability innovation competition. Emerging out of 450 applications from over 60 countries this year, SeaChange won project grant funding of SGD $1 mln ($737,000) from the Temasek Foundation to develop their project in Singapore. The Liveability Challenge is a global platform that hunts for and accelerates the adoption of innovative solutions to some of the greatest sustainability challenges facing cities in the tropics. (Eco-business.com)

AND FINALLY…

By royal request – Lawyers for the UK’s Queen Elizabeth secretly lobbied Scottish ministers to change a draft law to exempt her private land from a major initiative to cut carbon emissions, The Guardian reported, citing documents obtained by a Scottish lawmaker that suggest the interventions occurred as recently as February. The exemption means the Queen, one of the largest landowners in Scotland, is the only person in the country not required to facilitate the construction of pipelines to heat buildings using renewable energy. The move appears at odds with the royal family’s public commitment to tackling the climate crisis, with Prince William recently joining his father Charles in campaigning to cut emissions and protect the planet. The documents also suggest Nicola Sturgeon’s government failed to disclose the monarch’s lobbying this year when a Scottish politician used a parliamentary debate to query why the Queen was securing an exemption from the green energy bill.

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