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TOP STORY
Brussels ‘toolbox’ avoids EU ETS intervention, asks for trading probe
The European Commission avoided calls for EU ETS intervention in its ‘toolbox’ of suggested measures for member states to tackle surging energy prices published on Wednesday, ruling out speculation as a major driver of higher carbon prices but still tasking officials to investigate further.
INTERNATIONAL
Energy transition going too slowly for net zero emissions pathway, IEA warns
Clean energy progress is not going fast enough to put global emissions into a sustained decline towards net zero by mid-century, the Paris-based International Energy Agency (IEA) warned on Wednesday.
Governments commit to enhance landscapes, say no trade-off for GHG cuts
Governments met virtually this week for the first part of a UN summit tasked with developing a global framework to protect biodiversity, with implications on how forest and land protection plays into climate mitigation and how funders can claim credit.
Switzerland agrees bilateral crediting deals with Georgia, Dominica
Switzerland has approved bilateral agreements with Georgia and Dominica, enabling the two nations to sell it carbon credits to help meet its Paris Agreement emissions pledge.
ASIA PACIFIC
SK Market: Korean CO2 auction clears a shade below secondary market, but interest much improved
South Korea’s monthly carbon auction Wednesday followed the secondary market north and cleared 1% below spot prices, while selling over 90% of the allowances on offer.
Australia Market Roundup: ACCUs surge to new record high, as landfill gas projects near completion of big ERF contracts
Australian carbon credits traded at a record A$31 ($22.74) on Wednesday, while some landfill gas developers are close to fulfilling large ERF contracts, potentially freeing up more supply for the secondary market.
New South Wales unveils multi-billion dollar hydrogen plan
New South Wales, Australia’s most populous state, has released a new hydrogen plan to attract tens of billions of dollars of investment and boost the state’s role in Australia’s emerging renewable hydrogen sector, the government announced on Wednesday.
AMERICAS
California doles out year-high offset issuance weeks from WCI deadline
California regulator ARB distributed the largest number of offsets since December this week in the penultimate issuance before the third full compliance deadline of the WCI cap-and-trade programme, state data showed Wednesday.
WCI floor price expectations increase for 2022 in penultimate inflation reading
California’s WCI-linked carbon market floor price expectations for 2022 rose again in September as inflation inched up and bucked two months of declines, federal data published Wednesday showed.
EMEA
Russia’s VTB Group to launch carbon finance and trading business
Russian financial services company VTB Group is launching a division that will focus on carbon finance and trading, it announced Wednesday, four months after unveiling a partnership to develop a emissions marketplace.
Euro Markets: EUAs range-bound as energy prices advance
Carbon was little changed in early Wednesday trade, with participants describing a “range-bound” market even as energy prices advanced.
Carbon Pulse hires new Brussels-based Climate and Energy Correspondent
Carbon Pulse has hired a new Climate and Energy Correspondent to cover what is a crucial time in Brussels.
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CONFERENCE
Prospero Events’ Carbon Trading and Markets 2021 virtual conference takes place Nov. 8-9. This virtual conference will gather C-level experts responsible for carbon & power trading, carbon markets & pricing, climate policy, ETS and market analysis from leading European energy companies as well as banks and other financial institutions. The conference will focus on discussing the ongoing challenges and trends in carbon markets and carbon trading insights. You can expect presentations and case studies from MOL Group, Enel, HeidelbergCement AG, Fortum, Berenberg, and more. Up to 90 minutes of Q&A and networking time.
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
EMEA
Bond besting – The sustainable finance market has passed another record, with the European Commission launching this week the largest ever green bond offering in a €12 bln 15-year bond sale, eclipsing the record-setting £10 bln inaugural Green Gilt issuance by the UK last month. The EU deal is the first green bond offering under its landmark €250 bln NextGenerationEU green bond COVID recovery programme, almost of third of which is set to be raised from green bonds. (ESG Today)
Tempus trap – The EU’s second-highest court has upheld the legality of the European Commission’s 2018 decision to approve Poland’s capacity market, dismissing a claim brought by demand response provider Tempus Energy. The court found that Brussels had correctly assessed the scheme, despite Tempus being successful in a 2018 challenge to Britain’s equivalent market where it claimed the market design amounted to subsidies for fossil fuel generators and discriminated against technology designed to cut electricity demand during peak times. The ruling on the British scheme suspended UK capacity market for several months while the EU regulators made further investigations and ultimately found the programme to be compatible with state aid rules.
Dear Germany – Twenty-five leading foreign and domestic writers, journalists, and intellectuals have written the German government in a joint letter, warning that dropping nuclear power would only increase the country’s emissions. In the letter, published by Welt on Wednesday, the authors, including environmental columnist George Monbiot and former editor-in-chief at Die Zeit, Theo Sommer, called upon Germany to utilise nuclear power to help the country meet its climate targets. “Germany is in danger of missing its 2030 climate target, despite all its efforts,” the authors wrote. They said that exiting nuclear power would increase emissions and result in Germany missing its 2030 climate target to slash GHGs by 65% relative to 1990 levels. Nuclear power has long been a contentious issue in Germany. The country agreed to accelerate the 2022 nuclear phaseout following the Fukushima disaster. (Euractiv)
Like my ride? – The tax cuts for company cars in Germany are undermining the country’s efforts to get a grip on its stubbornly high emissions from the transport sector, think-tank Agora Verkehrswende said in an analysis of the scheme that costs the federal budget an estimated €3-6 bln per year. About half of the tax cuts benefits the 20% of households with the highest income, while the poorer half of households only receives one-fifth. And most of the supported company cars are particularly damaging to the climate as they tend to have bigger engines and weigh more than privately-owned cars, the analysis conducted by the Institute for Applied Ecology (Oeko-Institut) found. A steering effect towards fully or partially electric cars could not be detected as the 8% share of new electric company cars was only half of that for private cars in the first half of 2021. Two in three newly registered cars in Germany are company-owned and the vehicles usually quickly move on to the used car market. Comfortable company cars are often used as an asset by employers in wage negotiations with high-earning employees and also often come with a flat-rate for gasoline, meaning they effectively incentivise a high utilisation rate of inefficient cars, the think-tank concluded. Germany has exceptionally high emissions from newly-registered cars compared to other EU member states, which at 140g of CO2 per km is much higher than in second-placed Netherlands, where new cars emit 98 gCO2/km on average. (Clean Energy Wire)
ASIA PACIFIC
Providing the coin – The Asian Development Bank has announced it will spend at least $100 bln on climate issues over 2019-30, up from $80 bln in previous plans. The additional $20 bln will be spread across five priority areas, including one for mitigation (energy storage, energy efficiency, transport) and one for propping up private-sector initiatives.
Head east – China Eastern Airlines on Tuesday carried out the country’s first carbon neutral flight, according to Sina news. A flight from Shanghai to Beijing offset its emissions using offsets the airline bought when a trio of Chinese firms last month announced a “carbon neutral” crude oil shipment from Angola. Korean Air has previously claimed a carbon neutral flight, while Australia’s VIVA Energy is marketing carbon neutral jet fuel.
The Tasmanian level – The Australian state of Tasmania plans to legislate a “nation-leading” target of net zero carbon emissions from 2030, the Canberra Times reports. But opposition parties say the move is not ambitious enough, pointing to the fact the island state has achieved the feat six of the past seven years. “This target will be nation-leading and one of the most ambitious in the world,” Tasmania’s Premier Peter Gutwein said on Wednesday, the same day federal cabinet debated details of a plan to achieve net zero emissions by 2050. The Tasmanian government says the state’s emissions have fallen 108.6% since 1990, while the economy has nearly doubled. The island has reached net zero in recent years on the back of adopting hydroelectric power and changes in land use as forestry declines.
Nex in line– NexWafe, a German manufacturer of monocrystalline silicon wafers for solar panels, said it has received a $28.8 mln investment from a unit of Indian refining conglomerate Reliance Industries, Renewables Now reports. Reliance New Energy Solar Limited was a strategic lead investor in the German firm’s $45 mln Series C funding round. The funds from the Indian firm’s participation will help NexWafe speed up the development of its products and technology and complete the commercial development of its solar products on prototype lines in Freiburg, it said. The list of other investors in the funding round includes InnoEnergy, Lynwood, Saudi Aramco Energy Ventures.
AMERICAS
Negative positives – None of the US’ largest “climate positive” corporations are fully supporting the country’s biggest legislative opportunity in over a decade to address the climate crisis and move toward alignment with the Paris Agreement, a new report shows. The report, a collaboration of ClimateVoice and InfluenceMap, found none of the top 20 climate positive companies have endorsed the climate policies of the Build Back Better Act, supported its revenue raising provisions, and opposed lobbying against the bill by trade associations; 12 met none of those requirements. Those companies – 3M, Cisco Systems, Coca-Cola, Google, HP, Johnson & Johnson, McDonald’s, Nike, PepsiCo, Pfizer, Qualcomm, and Tesla — are “missing the moment”, the report said. (Climate Nexus)
Down low on disinfo – The CEOs of six major fossil fuel companies and trade associations will testify at a blockbuster Congressional hearing this month about their role in spreading climate disinformation, US Rep. Ro Khanna confirmed to The Climate 202. Khanna and House Oversight Chairwoman Carolyn Maloney sent letters last month to the executives of ExxonMobil, BP, Chevron, Shell, the American Petroleum Institute, and the US Chamber of Commerce asking them to testify about their reported efforts to mislead the public about climate change. Oil company executives previously declined invitations from Sen. Bernie Sanders and Rep. Katie Porter to testify before the Senate Budget Committee and the House Natural Resources Committee, respectively. But Khanna has threatened to subpoena the executives this time around.
AND FINALLY…
You’re doing it all wrong – Fewer than one in ten companies are measuring their GHG emissions correctly, according to Boston Consulting Group, highlighting a major hurdle in the race to net zero. Only 9% of companies have the ability to count their emissions frequently and accurately, the business strategy firm said in a study released Wednesday. The research showed that 81% of companies don’t report emissions related to their own activities, while 66% omit emissions from their suppliers and customers. Over half of firms acknowledged an error rate of as much as 40%. “If you were off by 40% on your financials, you would be put in jail,” said Mike Lyons, BCG managing director and partner. “If you’re so far off, that will catch the eye of shareholders and board members. You will get people fired and activists will say that you are not credible.” The 1,290 organisations in the survey spanned Europe, Asia, North America and South America, covering industries from healthcare to finance. The companies had employee counts ranging from 1,000 to more than 100,000, and revenues from under $100 mln to over $10 bln. An alcohol company involved in the research failed to measure emissions related to their glass bottles, such as suppliers, materials, and countries of origin. When they did, they found that emissions were 45% higher than initially measured. In another case, emissions at a US housewares retailer were more than double than originally estimated once usage for ovens and microwaves were included. (Bloomberg)
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