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TOP STORIES

No progress this week on US House vote for infrastructure bill, leaving climate funding in limbo

Delayed legislative votes caused by Democrat wrangling are raising questions over how the US will move forward with its climate change policies ahead of COP26, with both the proposed infrastructure and reconciliation bills seen as crucial for climate action.

US lawmaker deal to boost carbon capture and storage tax credit to $85/tonne -reports

The White House and Democratic lawmakers have reached agreement to boost the US tax credit for carbon capture and storage (CCS) to $85/tonne, according to media reports, a level that could see more industrial emitters adopting the technology while also providing a boost to the country’s oil and gas sector.

EMEA

Despite snub, EU lawmakers may yet call for carbon market speculation curbs

A European Parliament resolution to seek restrictions on speculation in the bloc’s carbon market could still be tabled in the coming weeks, EU sources told Carbon Pulse on Friday, despite an initial rejection by political leaders.

Euro Markets: EUAs halt quarter-end losses, still post modest weekly decline

EUA prices declined 1.4% on the week after a day of moderate volume on Friday, while energy prices were mixed as the new quarter began.

UK ETS on track to be world’s third carbon market to trigger price curbs

The UK’s carbon market faces the prospect of being the third ETS in the world to inject additional permits to try to restrain soaring prices, as the cost of permits in the nascent scheme has risen more than 40% above its Cost Containment Mechanism’s current trigger level.

Replace UK climate policies with a single carbon tax, think-tank recommends

The UK government should consider replacing its raft of climate policies and carbon pricing schemes with a single tax to help it more easily reach its mid-century net zero emissions target, a think-tank said early Saturday.

ASIA PACIFIC

AU Market: ACCUs jump 10% to new record high on thin volume

Australian spot carbon offsets rose 10% late on Friday afternoon, as bullish sentiment and scarce supply continue to push the market north, although on small volumes.

Australia approves carbon offset method for CCS

Australia has approved a method that allows carbon capture and storage (CCS) projects to generate offset credits, the world’s first nation to do so, in a move the government said will allow Australia to increase its LNG production.

AMERICAS

Speculator WCI net length sees largest draw in 18 months, CFTC data shows

Speculator net length in WCI allowances suffered its largest draw since Sep. 2020, according to US Commodity Futures Trading Commission (CFTC) data published Friday, while compliance entities held fast to their net short positions over the past week.

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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

INTERNATIONAL

Don’t leave me stranded – Western fossil fuel companies investing in Africa face a significant risk of regulatory and financial climate action that’s getting more explicit, a US climate envoy Jonathan Pershing said on Friday during a virtual media briefing while in South Africa as part of a continental trip. “There’s an increasing implicit (and) explicit price on carbon … If you’re a company looking to make an investment in oil and gas, you have to ask yourself … am I going to be left with a stranded asset?” he asked. (Reuters)

Join the alliance – The UK government is working to launch a coalition of countries and financial institutions committed to end public funding for fossil fuels abroad at UN climate talks in Glasgow this November. The COP26 host has repeatedly said it wants the summit to “consign coal to history” and has been working with Italy to seek agreement among major economies to end unabated coal power. But the UK’s ambition goes beyond coal. It is seeking to build an alliance of nations and institutions willing to commit to end the financing of oil and gas projects internationally. The UK is working with the EIB to convince both developed and developing countries along with large financial institutions such as multilateral development banks to sign a statement on aligning public finance with accelerating the clean energy transition. They are asking donors and lenders to prioritise support for clean energy, to end public finance for fossil fuels and to press others to do the same. Climate Home understands the UK is hoping to launch the statement on the energy-themed day at COP26 on Nov. 4.

Double agents – A new analysis shows how many prominent US companies that claim to support action to address the climate crisis are supporting business groups fighting to scuttle the landmark climate legislation being negotiated on Capitol Hill, The Guardian reports. Apple, Amazon, Microsoft, and Disney are among the major corporations either supporting or actively directing lobbying groups like the US Chamber of Commerce and Business Roundtable that are trying to kill the $3.5 trillion budget known as the Build Back Better Act – also known as the “reconciliation package”. “Major corporations love to tell us how committed they are to addressing the climate crisis and building a sustainable future,” Kyle Herrig, president of watchdog group Accountable.US, which compiled the analysis, told The Guardian. “But behind closed doors, they are funding the very industry trade groups that are fighting tooth and nail to stop the biggest climate change bill ever.” Separately, groups backed by the oil and gas industry and the Koch network are allegedly deluging American politics with millions of dollars to sink President Biden’s domestic policy agenda, including major efforts to address the climate crisis. A new report from InfluenceMap reveals the American Petroleum Institute, and its front group Energy Citizens, spent more than $2 mln on lobbying in the first half of 2021, and just since Aug. 11 API’s Facebook ads have been viewed at least 21 mln times. That’s in addition to the seven-figure TV ad campaign API is running against the reconciliation package currently hanging in the balance. Meanwhile, Rolling Stone reports the Koch network is spending millions to undermine the Build Back Better Act. (Climate Nexus)

All rise – Vanuatu is asking the International Court of Justice in The Hague to issue an opinion on the rights of present and future generations to be protected from the adverse impacts of climate change. Vanuatu, with a population of some 280,000 people spread across roughly 80 islands, is among more than a dozen Pacific island nations facing rising sea levels and more regular storms that can wipe out much of their economies. “In response to the catastrophic levels of climate change loss and damage faced by this small Pacific nation, Vanuatu recognises that current levels of action and support for vulnerable developing countries within multilateral mechanisms are insufficient,” the government said in a statement last week. Vanuatu said it will route the initiative through the United Nations General Assembly. While advisory opinions by the court are not legally binding, they carry legal weight and moral authority given its status as the highest U.N. court for disputes between states. Its opinions can inform the development of international law. (Reuters)

EMEA

Claws out – Spanish power firms Iberdrola, Enel unit Endesa and the Spanish unit of Portugal’s EDP, along with European electricity industry associations and the Global Infrastructure Investor Association, have written to the European Commission asking it to immediately start an analysis of the Spanish government’s plans to claw back company profits and channel them to consumers hit by high energy prices, Reuters reported, citing the letter. The firms say the move jeopardises EU climate plans by breaking investors’ confidence and undermining confidence in the bloc’s electricity market and ETS.

Carbon competition – Britain has temporarily exempted parts of the CO2 producing industry from competition law to help provide further security of supplies to businesses in the country amid fears that a spike in energy prices could lead to shortages. Last week, the country suspended competition laws to allow fuel suppliers to share information and coordinate their response to petrol shortages. The government said major supplier Ensus has restarted its CO2 production operations, while CF Fertilisers’ plant was now operating at full capacity following an agreement last week. (Reuters)

Too stiff – Germany’s current climate policies rely too much on rigid sectoral targets for emissions reduction and on blanket regulations and requirements that make climate protection unnecessarily expensive, according to the president of the Institute for Economic Research (ifo), writing in Handelsblatt. Instead, the incoming government should put more emphasis on the CO2 price and the EU ETS as instruments to reduce emissions, he said. (Clean Energy Wire)

Only 8? That’s great – Environmental regulations aimed at cutting the carbon footprint of aviation will increase the cost of flying by around 8% by 2050, according to the European Commission. The EU executive tabled a package of energy and climate laws in July this year, aiming to halve the EU’s carbon emissions by the end of the decade before reaching net zero by 2050. Several of those are focused on the aviation sector, such as plans to scrap the tax-free status of kerosene, and phasing out free CO2 permits for flights covered by the EU ETS. Another flagship measure is a mandate that jets refuelling at EU airports uplift a set percentage of sustainable aviation fuels (SAFs). “It’s clear that there is going to be a price impact” from EU proposals to green the aviation sector, said Filip Cornelis, aviation director at the European Commission’s transport department. “We’ve calculated that the SAF mandate on its own will increase the fuel cost for airlines by about 3% by 2030, with an impact on ticket prices of about 1%,” said Cornelis who was speaking at a online event hosted by Euractiv on Tuesday. “And this is simply because sustainable fuels continue to be more expensive than kerosene, between two and five times more expensive,” he told participants at the event. By the middle of the century, the Commission expects an 8% impact on the price of tickets from the SAF mandate, he added.

AMERICAS

NiCe work – North Carolina legislative leaders and governor this week reached a bipartisan agreement on a major energy bill that would put into law the greenhouse gas reduction goals outlined in Roy Cooper’s (D) Clean Energy Plan. In return, the legislation would give Duke Energy, the state’s dominant utility, a win it has long sought on multi-year rate-making despite the concerns of many of the state’s most prominent businesses and energy advocates. The revised version of House Bill 951 requires the NC Utilities Commission to follow the least cost pathway in reducing carbon emissions by 70% by 2030 and achieving carbon neutrality by 2050 without sacrificing reliability. It requires 45% of solar power to come from a competitive bidding process among independent power producers and 55% from public utilities, which will help reduce costs and encourage innovation. It also requires public utilities to use securitization at 50% to retire coal-fired power plants resulting in lower cost to consumers. Earlier versions of HB 951 that focused primarily on which coal-fired power plants to close would have resulted in a 61% reduction, short of that goal. Under the revised legislation, regulators from the NC Utilities Commission would guide how Duke reaches the emissions targets by developing carbon reduction plans every two years. The first version of the plan would be due by the end of 2022. The Utilities Commission would be able to push the greenhouse gas targets back by as much as two years in most situations and further if the delays are due to permitting or grid modifications necessitated by the construction of a nuclear power plant or wind farm. Some parts of the bill that the House passed that were not included in the compromise version were a provision allowing Duke Energy to charge ratepayers $50 million to try to find a location for an experimental nuclear reactor and another prohibiting North Carolina from entering RGGI. The compromise legislation is expected to move through committees next week and receive a floor vote in the Senate on Thursday. Due to the changes, the House would also need to approve the revised legislation. (News Observer)

Cold calling – Alaska Governor Mike Dunleavy (R) is eyeing generating carbon offsets from state forestlands, CoastAlaska reports. It’s requested proposals from prospective consultants “to investigate the potential for a carbon offset credit programme based on carbon sequestration on state lands,” according to a document that went up this month on a state website. “What we are looking for is to establish a programme that enables the state of Alaska to communicate to the public that responsible development and management of our lands exists,” said state Revenue Commissioner Lucinda Mahoney. “And we expect that we especially want to communicate this to many of the banks on Wall Street that prohibit investment in the Alaska Arctic oil and gas projects,” she added, was referring to pressure by major lenders that have effectively ruled out investments in new Arctic fossil fuel projects over concerns about impacts on the environment, Indigenous peoples and climate change.

ASIA PACIFIC

Cabinet reshuffle – Australia’s minister for energy and emissions reduction, Angus Taylor, has been granted expanded ministerial responsibilities, with the industry portfolio added to his existing responsibilities, Reneweconomy reports. Tim Wilson, a member of parliament and a former climate policy director of the right-wing Institute of Public Affairs, has been appointed as assistant minister for industry, energy and emissions reduction. The appointments, among others, were made in a ministerial shake-up announced by Australian Prime Minister Scott Morrison on Friday. Taylor this week also approved a method that will allow CCS projects to generate offset credits, making Australia the world’s first nation to do so.

AND FINALLY…

Raise the temp like a vandal – Korean tech giant Samsung enlisted 90s US rapper Vanilla Ice for an energy conservation campaign, this week dropping a video of a new version of his main hit called “Reduce Your Ice, Ice Baby.” It calls on listeners to slightly raise the temperatures on their refrigerators to save the climate and, of course, to buy a new Samsung refrigerator. Engadget reports that the concept is based on study Samsung did using EU data that found that if every household in Europe alone increased its freezer’s temperature by 1C, it would lower the world’s CO2 emissions by more than 1 Mt a year.

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