CP Daily: Friday March 4, 2022

Published 23:13 on March 4, 2022  /  Last updated at 23:20 on March 4, 2022  /  Newsletters  /  No Comments

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

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TOP STORY

Chinese province slams brakes on forestry offset projects for the international voluntary market

One of China’s provinces has said it will not approve carbon forest projects for the international voluntary market this year, sparking concerns among developers that the same policy will spread to other regions.

EMEA

EU plans to uphold carbon market’s MSR survive early lawmaker test

EU lawmakers snubbed efforts to weaken the EU carbon market’s supply-curbing MSR in a preliminary vote this week, though multiple hurdles remain as politicians increasingly focus on energy security concerns amid Russia’s brutal attack on Ukraine.

Euro Markets: EUAs post 26% weekly fall amid widespread liquidations on fears of widening conflict

EUAs gave up modest early gains on Friday for a 26% weekly loss in relatively calm trade after three days of extreme volatility, while energy prices rose strongly amid Russian attacks around nuclear reactors in Ukraine and reports that sanctions against Moscow may soon include some energy products.

ASIA PACIFIC

CN Markets: China sees spike in volumes as late-comers finish compliance

Volumes spiked in China’s emissions market over the past week as a number of emitters carried out OTC deals to belatedly finalise their 2019 and 2020 compliance, but price levels remained largely unmoved.

India must speed up clean shift in finance, report says

Ongoing financing of coal fired-power construction in India will make it harder for the country to meet its stated target to reduce the carbon intensity of its economy by 45% by 2030, and in turn keep its climate pathway unaligned with Paris Agreement goals, a report has found.

VOLUNTARY

Experts expect slow start for blue carbon offsets despite heightened interest

Blue carbon projects are unlikely to see a rapid scale-up in credit issuance volumes due to long-lead times for some activities and difficulty in designing verifiable methods in other areas, a conference heard Friday.

Canada-based VCM investor taps former UNEP chief, Trump administration lawyer

A Canadian alternative ESG investor financing carbon projects has hired as strategic advisors the controversial former head of the UN Environment Programme and a lawyer who served multiple US Republican presidents and a climate sceptic organisation, the company announced Friday.

AMERICAS

Compliance entities, financials pare back California carbon holdings

Emitters and speculators under the WCI cap-and-trade programme saw their California Carbon Allowance (CCA) positions dwindle this week amid the February contract expiry and the beginning of a massive price decrease, according to US Commodity Futures Trading Commission (CFTC) data published Friday.

US Carbon Pricing and LCFS Roundup for week ending March 4, 2022

A summary of legislative and regulatory action on carbon pricing, clean fuel standards, and clean energy at the US subnational and federal level this week, including the near-final passage of a cap-and-trade related bill in Washington state.

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CONFERENCES

North American Carbon World (NACW) 2022 – Apr. 6-8 in Anaheim, California – presented by the Climate Action Reserve: Learn, collaborate, and network on carbon markets and climate policy at NACW, North America’s largest carbon event. NACW features comprehensive and up-to-date information, key thought leaders advancing innovative climate solutions, and the best networking opportunities with colleagues in the business, government, nonprofit, and academic sectors. NACW will dive into the status and future of North American carbon markets, climate policies, innovative solutions, natural climate solutions, net zero pledges and beyond, transportation and LCFS markets. www.nacwconference.com

City Week 2022: Resetting Priorities for a Better Future – Apr. 25-27 at London Guildhall: Now in its 12th year, City Week is the premier gathering of the international financial services community. Organised in partnership with the UK Government and leading City institutions, City Week brings together industry leaders and policy makers from around the globe to consider the future of global financial markets. Each day will address a specific theme, with Day 1 focussing on “Meeting the climate change challenge – the role of financial services in achieving net zero”. www.cityweekuk.com

Reuters Events: Global Energy Transition 2022 – June 14-15 in New York City: The conference unites CEOs and changemakers from the energy, industrial, and government ecosystems to shed light on the defining issue of our time, and help companies meet a uniquely difficult challenge. Over two days and five critical themes, we will define the future of energy, inspire a decade of action, and prepare the sector for challenges still to come, with diverse voices from around the world bringing passion and expertise to deliver a new path forward. Find out more by visiting the website today: https://bit.ly/35H7cgb

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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

Renewables run – 2021 was a landmark year for renewable energy in the US, with a record-breaking $105 bln private investment in clean energy technologies and electric vehicles, according to a report released Thursday by BloombergNEF and the Business Council for Sustainable Energy. Total US investments last year included over 8 GW of announced hydrogen-compatible power turbines, positioning the country to be a hydrogen industry leader in the next decade. In 2021, developers also built 37 GW of wind and solar capacity, while year-to-year sales for electric vehicles doubled from 2020. (Utility Dive)

Fossil future – However, CO2 emissions would fall just 1.8% through 2050 under current US laws and regulations despite renewable energy nearly doubling its share of the nation’s energy mix, the Energy Information Administration said Thursday. That’s because the boom in carbon-free energy would not be enough to replace natural gas and petroleum, which would remain the top US fuel sources. EIA projected renewable energy would account for 16% of the US energy picture by mid-century, up from 8% today, while petroleum and natural gas would remain relatively constant at 37% and 32%, respectively. Electric vehicles would compose 21% of the car market, up from 3% now. But overall US oil and gas consumption will still grow even if it doesn’t increase market share, EIA’s analysis showed. Those numbers would not get the US anywhere near President Joe Biden’s goal of hitting net zero emissions on the power grid by 2035 and economywide by 2050, although he is banking on new policies to get it done. (Politico)

Displacement down low – The Alberta Environment and Parks ministry on Friday announced it has conducted its scheduled review of the Electricity Grid Displacement Factor (EGDF), which is now available for a 30-day public comment period. The department said parameters related to emission offset credit generation for renewable projects initiated on or after Jan. 1, 2024 will be looked at during 2022 as part of the renewal process for the Technology Innovation and Emissions Reduction (TIER) regime, or subsequently as part of normal operational review. It added that emission offset project developers should be aware that it is unlikely that 10-year crediting periods will be considered by the department for renewable emission offset projects initiated on or after Jan. 1, 2023, contingent upon the outcome of the TIER review to be undertaken this year.

EMEA

Electric ’26 – A study has found that the Netherlands could have electric-powered short-range commercial flights by 2026. The study commissioned to investigate the feasibility of electric aircraft has concluded that commercial services by small, short-range e-planes could begin by the middle of the decade. The investigation focused on operations within the Netherlands, and between the Caribbean islands of Aruba, Bonaire and Curaçao. It concluded that a nine-seat electric aircraft could be operated by 2026, while a 19-seat electric aircraft could be in service by 2030. For electric aircraft to enter commercial service however, airport and energy infrastructure would require a significant upgrade, the report also found. The Netherlands has committed to a decarbonisation of its air transport sector, through 2030 initiatives including a 15% cut in domestic flight emissions compared to 1990, electric taxiing of aircraft, and the introduction of hybrid-electric planes of up to 50 seats. The country aims to transition to zero emission flights on all domestic routes and fully-electric aircraft on flights of up to 500 km by 2050. (Green Air)

Deutsche Book – Deutsche Bank on Friday laid out the scale of emissions connected to its loan book in several carbon-intensive sectors ahead of publishing formal targets to cut them later this year. Under Chief Executive Officer Christian Sewing, the bank is making a big push to help finance companies as they attempt to become more sustainable. Germany’s largest lender said that the majority of its financed GHG emissions were bunched into three sectors – oil and gas, utilities, and steel, metals and mining. As of the end of 2021, lending to those sectors was €17 bln, 16% of its loan book for corporations and 3.5% of total loans, Deutsche said. Banks are increasingly signing up to get to net-zero carbon emissions by 2050 and are now having to come up with shorter-term targets that will get them there. Deutsche said that it would publish targets by the end of this year. (Reuters)

ASIA PACIFIC

Blowing in the wind – The Australian state of Victoria has announced an ambitious new plan to accelerate the rollout of offshore wind energy generation projects in the state, setting rolling targets of 2 GW installed by 2030, 4 GW by 2035, and 9 GW by 2040, Renew Economy reports. Victoria’s Labor Premier Daniel Andrews announced the “new and even more ambitious” renewable energy goals for the state, which he said his government planned to “meet and exceed.” In a release detailing the new targets, the state government said the first power from offshore wind was expected as soon as 2028 following a competitive process. “For the first time anywhere in Australia, we will set a minimum target for offshore wind power generation,” Andrews said.

AND FINALLY…

You reap what you don’t sow – Fifty-five of the largest US-based corporates are failing to set science-based climate goals, let alone deliver them, according to a report published this week by non-profit organisation As You Sow. The organisation was looking for target plans including a net zero goal for 2050 at the latest, applicable to all emissions scopes, and underpinned with verified, 1.5C-aligned interim targets. Twenty of the companies assessed had no public goal to reduce emissions, and only one-fifth had set a net zero target for 2050 or sooner, covering both indirect and direct emissions. Less than half (20) of the firms reported all relevant indirect (Scope 3) emissions, and just two firms – Microsoft and Apple – were deemed to have goals to reduce Scope 3 emissions that are 1.5C-aligned. Even weaker reporting was recorded around carbon offsetting, as just one in five of the companies assessed disclosed the number of carbon offsets purchased, a description of the types of carbon offsets projects, and the verification status of these offsets. (edie)

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