CP Daily: Thursday November 11, 2021

Published 00:38 on November 12, 2021  /  Last updated at 11:46 on November 15, 2021  /  Newsletter  /  No Comments

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

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COP26

Brazil seen likely to compromise on Article 6 emissions trade accounting

UN negotiations on Article 6 rules to govern international emissions trade took a step forward on Thursday when Brazil appeared to accept a compromise on accounting rules, two sources close to the process told Carbon Pulse.

Egypt, UAE confirmed as next UN climate summit hosts

Egypt was confirmed as the next host of the UN climate summit for late 2022, with the United Arab Emirates selected to host the meeting for the following year, current COP26 President Alok Sharma announced on Thursday.

COP26 Roundup: Day 10 – Nov. 11

Climate talks in Glasgow carry on, with negotiators having just two more full days to agree on texts before entering the more or less obligatory overtime. Check in here for the latest news and updates throughout the day.

ASIA PACIFIC

Chevron to buy more than 5 mln carbon credits to make up for CCS shortfall

Chevron Australia will buy 5.23 million carbon offsets to compensate for failing to capture and store the required amount of CO2 emissions from its Gorgon LNG CCS project in Western Australia.

Chinese emitters forced to chase scarce supply after ignoring CO2 verification requirements

A number of Chinese power plants unexpectedly face a shortage of allowances in the national CO2 trading scheme after neglecting to finalise the verification process for their 2019 emissions, according to market participants.

INTERNATIONAL

UK, Indonesia eye carbon trading partnership

The UK and Indonesia are eyeing a joint carbon trading partnership, which could help facilitate the flow of land-based offsets from east to west.

Australia’s FFI signs green hydrogen deal for aviation with US firm

Fortescue Future Industries (FFI), the green energy subsidiary of Australian iron ore giant Fortescue Metals Group, has signed a memorandum of understanding (MOU) with US-based Universal Hydrogen to promote green hydrogen use in the aviation sector.

AMERICAS

NA Markets: New records set as CCAs target $34, RGGI eclipses $13

North American carbon prices continued to torch their recent all-time highs this week, with California Carbon Allowances (CCAs) failing to slow down before next week’s quarterly auction and RGGI Allowances (CCA) surpassing this year’s Cost Containment Reserve trigger level.

EMEA

Euro Markets: Low-volume technical buying, gas supply threat send EUAs to new 5-week high

EUAs climbed to a new five-week high on Thursday on what traders called “unconvincing” low-volume technical buying, which was helped by other energy markets rising on a Belarusian threat to Europe’s gas supplies.

VOLUNTARY

Evolution Markets introduces consulting arm to assist in net zero plans

New York-based carbon brokerage Evolution Markets on Thursday announced the launch of a new consulting arm to help companies establish and meet emissions reduction objectives and procure environmental credits.

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CONFERENCE

Prospero Events’ Carbon Trading and Markets 2021 virtual conference now takes place on Dec. 6-7. 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

INTERNATIONAL

Virtual emissions – Cryptocurrency miners would need to plant nearly 404 mln trees to offset their emissions in 2021, according to a study by digital currency site Forex Suggest. The eight leading currencies, including Bitcoin, Ethereum, Dogecoin, and Ripple, are projected to emit more than 80 MtCO2e this year, with Bitcoin accounting for 70% of the total. Bitcoin is also the most carbon-intensive currency, with each transaction requiring 707 kWh. Offsetting the oldest digital currency’s total energy use would require 284 mln trees. At the other end of the scale, Dogecoin needs just 0.12 kWh per transaction and total mining activity could be offset with just 7117 trees, the study said.

EMEA

Green book – EU climate chief Frans Timmermans gave the clearest signal yet that the bloc is considering a role for natural gas under its green rulebook for investments, setting up a clash with some national governments. According to Bloomberg, Timmermans said that an exit from coal for some member states would require an “intermediary stage” using natural gas. It would be subject to strict conditions, including pre-fitting pipelines so that they can carry hydrogen and de-carbonised gases after the transition from natural gas ends. “We will have to also invest in natural gas infrastructure … As long as we do it with an eye of only doing this for a period, then I think this is a justified investment,” he said at COP26. Environmental groups have criticised the potential inclusion of natural gas in the EU’s so-called taxonomy, the set of rules determining whether certain investments can be classified as green. They say that it would result in the bloc avoiding its responsibility to keep global warming below 1.5C, and that it may open the door to also include nuclear energy. But in a joint statement issued during COP26, environment ministers from Germany, Denmark, Portugal, Austria, and Luxembourg warned against classifying nuclear power as green in the EU’s sustainable investment rulebook.

Capacity boost – UK-based hydrogen energy solutions provider ITM Power has secured a site for its second UK gigafactory about 3.2 km from its existing facility, which is located in Sheffield, Renewables Now reports. The company said it has agreed heads of terms to purchase a site from the University of Sheffield for £13.4 mln ($18.2 mln). It plans to build a factory with an annual capacity of 1.5 GW there, with full operations now targeted by the end of 2023. ITM Power stated readiness to invest in a second gigawatt-scale polymer electrolyte membrane PEM electrolyser factory in April. Recently, the company raised £250 mln to scale up its electrolyser manufacturing capacity to 5 GW by 2024 by adding a second UK factory and a first facility abroad. The second UK factory will complement ITM Power’s existing 1 GW capacity at Bessemer Park, officially opened in August, and will serve as a template for its first international plant, which is expected to have an annual capacity of 2.5 GW.

ASIA PACIFIC

Renewable zone – The New South Wales (NSW) government has officially established Australia’s first dedicated Renewable Energy Zone (REZ), making a formal declaration of the Central-West Orana zone in the state that will host at least 3 GW of solar, wind and storage, Renew Economy reports. The new zone, centred around the regional hub of Dubbo, is the first of at least five REZs to be created in NSW as part of its infrastructure plan to replace its rapidly ageing fleet of coal fired power stations. The declaration kick-starts the official process of establishing the zone, which will ultimately see a series of auctions to see which projects, among at least 27 GW proposed for the area, will be included. NSW energy minister and treasurer Matt Kean said the dedicated zone would attract at least 3 GW of new renewable energy and energy storage capacity, along with A$5.2 bln ($3.8 bln) of new investment.

AMERICAS

OCFP rulemaking – The Oregon Department of Environmental Quality (DEQ) on Wednesday announced its advisory committee for its 2022 rulemaking to increase the ambition of the Clean Fuels Program’s (OCFP) annual carbon intensity (CI) reduction targets after 2025. The committee will review the technical issues and fiscal impacts related to the proposed rules, with the appointed members reflecting the range of fossil fuel suppliers and retailers, biofuel companies, environmental organisations, and others that are both directly and indirectly affected by proposed changes to the OCFP. The first advisory committee meeting will take place Dec. 9, with three more scheduled through May.

VOLUNTARY

Too much of a good thing? – The Science Based Targets initiative, the non-profit organisation that assesses whether climate promises that companies make are ambitious enough to help keep global warming in check, is experiencing growth pains more often associated with Silicon Valley startups, WSJ reports. Already under pressure to cater to a lengthening queue of companies that want its seal of approval on their climate plans, SBTi also wants to help track their progress – a challenge, given the lack of standardised emissions data. SBTi co-founder and managing director Alberto Carrillo Pineda said it took five years for the number of companies in its pipeline – those that had at least said they would seek SBTi’s endorsement – to reach 1,000. The next 1,000 took one year. Last week, SBTi said it raised $37 mln of grant funding, with the Bezos Earth Fund and the IKEA Foundation providing $18 mln each over three years and a foundation funded by the Netherlands’ Brenninkmeijer family providing $1 mln. The funding will let SBTi expand, but won’t take the pressure off, Pineda said. The group has publicly approved the targets of 1,006 companies, with another 1,116 in the pipeline, according to its website. SBTi says its adoption rate has to keep growing exponentially to help bring down emissions. SBTi has around 45 staff, but the targets are assessed by just eight analysts. They are currently approving around 60 targets a month, Pineda said, adding that SBTi’s review process, with multiple analysts endorsing each decision, means the greater workload isn’t affecting the reliability of SBTi’s decisions.

Expansion abounds – Canada-based carbon markets consultancy Radicle is expected to grow to at least 500 employees in the next few years, up from 85 currently, CEO Ed Alfke told SustainableBiz.ca. Alfke noted the company is already present in the US and Brazil, and will be acquiring a company in a fourth country by year-end. Meanwhile, Eric Dinger is joining US-based non-profit organisation Arbor Day Foundation as president of its new carbon market venture, Arbor Day Carbon, the company announced Thursday. In a press release, Arbor Day Carbon said Dinger will work with investors to help drive the creation of quality carbon credits to meet current market demand, support developers and landowners to maximise the impact of their carbon projects, and partner with companies who seek to incorporate verified forestry carbon credits into their sustainability programmes.

AND FINALLY…

Rap attack – What was scheduled as a UN side event at COP26 titled “REDD+ Rainforest Carbon Credits: A Buyer’s Guide” was instead broadcast virtually as a Canadian rap artist’s hour-long performance. Rapper Baba Brinkman’s show covered all things climate, including digging deep into the IPCC reports, climate negotiations, markets, and technologies available to address the climate crisis. Brinkman’s career began in 2004 and has spanned literary, science, and environmental rap. His performances have been recast as educational tools, and supported by sponsors such as Cambridge University. In 2015, Brinkman’s play ‘Rap Guide to Climate Chaos’ premiered at the Edinburgh Fringe, followed by performances at COP21, the conference that established the Paris Agreement.

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