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TOP STORY

Key EU lawmaker seeks quicker introduction of carbon border measures

The EU’s proposed Carbon Border Adjustment Mechanism (CBAM) should fully replace free EUA allocations by no later than 2028 if the bloc is serious about meeting its 2030 climate goals, the European Parliament’s lead lawmaker on the issue said in a draft report on Wednesday.

ASIA PACIFIC

Kazakhstan energy price uprising risks another blow to carbon pricing

Unprecedented protests in Kazakhstan over a gas price hike this week have seen the government quickly roll back energy policy reforms, endangering the development of one of the region’s carbon markets in a further example of the political challenges of the clean energy transition.

AMERICAS

Financial services company acquires US consultancy Emission Advisors

A hedging management firm announced on Wednesday it has acquired Houston-based environmental credit brokerage and consultancy Emission Advisors, continuing the trend of consolidation and mergers in the booming carbon trading industry.

LCFS Market: California prices regain $150 as some see further increases ahead

California Low Carbon Fuel Standard (LCFS) credit values bubbled up over the year-end stretch to reach $150 this week, as some traders thought renewable diesel capacity problems and compliance buying could push prices higher in the near future.

EMEA

Euro Markets: EUAs continue to make gains as energy markets lift

EU carbon prices maintained this week’s upward trajectory on Wednesday, gaining as much as 4.3% in relatively light trading as energy markets rallied in the afternoon.

COMMENT

MARC(U) MY WORD: Key issues in EU ETS review

Observers and stakeholders generally agree that the revision to the EU ETS needs to ensure that the transition results in a prosperous and decarbonised, but not deindustrialised Europe.

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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

Reinventing the Wheeler – Virginia Republican Gov.-elect Glenn Youngkin announced Trump US EPA chief and former coal lobbyist Andrew Wheeler as his pick for the state’s next secretary of natural and historic resources. Youngkin said Virginia needs a “diverse energy portfolio” in announcing Wheeler’s appointment, as well as his intention to replace long-standing Department of Environmental Quality Director David Paylor with wetland restoration firm head Michael Rolband. Wheeler, who served as administrator of the US EPA from 2019 until the end of President Donald Trump’s administration, was an outspoken proponent of environmental deregulation during his tenure, ruffling feathers even among his own agency scientists. Among the actions taken during his tenure were the rollback of President Barack Obama’s never-enacted Clean Power Plan to reduce emissions from coal plants as well as the Obama administration’s stricter fuel efficiency standards for automobiles. Wheeler would be tasked with making good on Youngkin’s promise last month to withdraw Virginia from the RGGI cap-and-trade programme, though Democrats maintain a 21-19 edge in the state Senate and could conceivably block an appointment such as Wheeler’s. (Virginia Mercury)

Manchin Wednesdays, part I – US Senator Joe Manchin voiced support for climate provisions in the Democratic Party’s Build Back Better Act Tuesday, telling reporters, “The climate thing is one that we probably can come to an agreement much easier than anything else.” Manchin, who has made millions from the coal company his family owns and has received more campaign donations from the fossil fuel industry this election cycle than any other senator, also said “as we move from a fossil dependency to more of a cleaner, and you do that by using fossils in cleaner ways.” Last fall, Manchin effectively gutted the Build Back Better Act of a key climate provision that would have incentivised utilities to provide cleaner electricity to their customers, before nuking the entire reconciliation package in December. (Climate Nexus)

Manchin Wednesdays, part II – Meanwhile, the power plant that buys coal from Manchin’s family business won’t have a second life powering cryptocurrency mining. The Public Service Commission of West Virginia rejected a proposal late last week by the owners of the Grant Town power plant to buy out of a power purchase contract with a subsidiary of utility giant FirstEnergy. The plan to convert the plant to a source of power for energy-intensive cryptocurrency mining carried the risk of permanent closure, FirstEnergy claimed in PSC filings. If the plant closes, it would affect Manchin’s personal finances. A company Manchin founded in 1988, now called Enersystems, has sold Grant Town the bulk of its coal for decades. Manchin earned $500,000 from Enersystems in 2020, according to Senate disclosure records. (E&E News)

EMEA

Credit lines – German utility Uniper has secured additional funds to shield itself from risks in a volatile trading environment. It said it can now access a €2 bln credit facility provided by the German state-owned KFW-bank as back-up “in case of further extreme commodity market developments”. The move comes a month after the firm revealed it could draw on up to €8 bln from its Finnish majority shareholder Fortum having already drawn on the full €1.8 bln from its core banks, Uniper said. (Montel)

Emissions money – Revenue of €4.7 bln generated through the first year of Germany’s nEHS transport/buildings carbon pricing measure was used to lower the country’s Renewable Energy Act surcharge, reducing electricity prices for consumers by €1.37/kWh, Clean Energy Wire reports. This income came as the German government raked in €5.3 bln from EU ETS auctions, double the amount raised in 2020.

Flight favour – Denmark’s Prime Minister Mette Frederiksen has pledged to make all internal flights “completely green” by 2030, arguing the Scandinavian country could play a pioneering role in the shift towards zero-emission air travel. In her new year address, Frederiksen said the government would also work to ensure that all Danes would have the opportunity to fly green on a domestic route by 2025 and confirmed that 2022 would be the year where Denmark would decide on a “new and ambitious” carbon tax for polluting companies. (BusinessGreen)

Green v green – The new government in Berlin aims to build between 1,000 and 1,500 new wind towers a year — breaking a red tape logjam that had blocked many projects as a result of local resistance often couched in terms of protecting the environment, birds, or beautiful views. That means up to 2% of the country will be covered by new wind projects. Politico profiles the job of new environment minister Steffi Lemke of balancing the need to swiftly build up renewable energy while also preserving nature.

ASIA PACIFIC

Tapping offset market – Singapore is considering to allow emitters covered by its carbon tax to use international offsets to meet some of its obligations, according to the Straits Times. The tax is currently just S$5 ($3.68) per tonne of CO2, but the government is reviewing it and is expected to increase the tax level to help drive deeper emissions reductions. Companies might be allowed to use international carbon credits to keep the cost down, though if the government opts to allow that, the units must be subject to corresponding adjustments in line with Article 6 of the Paris Agreement.

AND FINALLY…

Cleaner coal – The world’s largest coal port – Australia’s Newcastle – has announced it will now be powered entirely by renewable energy. Though the port continues to export an average of 165 Mt of coal a year, the move is part of a plan to decarbonise the business by 2040, and to increase the non-coal portion of its business so that coal only makes up half its revenue by 2030. It has signed a deal with Iberdrola, which operates the nearby Bodangora windfarm, for a retail power purchase agreement that provides the port with large scale generation certificates. (Guardian)

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