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EU watchdog finds no “major deficiencies” in carbon market workings, but identifies possible improvements including position limits
The EU’s securities market regulator has found “no current major deficiencies” in the functioning of the bloc’s carbon market, it said in its final report on the matter published Monday, though it suggested several measures to improve the ETS including possible trading position limits.
The EU must deliver its Fit for 55 (FF55) climate policy package in the face of a month-long Russian invasion in Ukraine that has further exacerbated high energy prices, the EU’s top climate official Mauro Petriccione said on Monday, rebuffing industry calls for reflection.
EUAs advanced the most in two weeks after EU finance watchdog ESMA said its investigation into trading and price action in the ETS had found “no major deficiencies”, while energy markets were mixed as Russia and Ukraine prepared for more talks as the war in Ukraine entered its second month.
Companies have been slow to commit to climate action that doesn’t involve claims on the resulting abatement, a panel heard on Monday, despite rapid growth in corporate commitments and a drive to encourage such private sector finance as a more credible alternative to international offsetting.
Prices for exchange-traded, standardised voluntary emissions reduction (VER) contracts continued to consolidate over the last week as carbon credits across the board struggled to find clear direction with traded volumes weak amid wider macroeconomic uncertainty.
Canadian e-commerce firm Shopify will invest an $13.5 million into a further nine carbon removal tech firms, the company announced on Monday, taking its total investment to $32 mln despite minimal direct emissions reductions potential.
Singapore-based AirCarbon Exchange (ACX) has signed a Memorandum of Understanding with carbon asset developer CarbonX to build a carbon marketplace in Indonesia, the two companies jointly announced on Monday.
Many of the accusations directed at Australia’s carbon offset market in recent days are “sensational” and not backed up by research, the lead industry body said on Sunday, though calls are picking up pace to reform the market and the role of the Clean Energy Regulator.
A Rio Tinto subsidiary has sold over 90,000 carbon credits to the government’s Emissions Reductions Fund (ERF) at fixed low prices despite no longer having to, regulator data showed Monday, while secondary market prices are showing signs of falling after recent controversies.
An individual in southwestern China’s Guizhou province received milder sentencing after agreeing to purchase forestry-based offsets as compensation for the damage that illegal logging caused.
California Carbon Allowance (CCA) prices on Monday jumped to their highest level since the Q1 WCI auction results were published, with traders attributing the upward movement to a variety of factors.
The International Emissions Trading Association will set up a Task Force to produce guidelines for the development of digital technologies for the carbon offset industry, including tokenised carbon credits, aiming to bolster the environmental integrity and transparency of the emerging digital carbon sector.
Job listings this week
- *Assistant Portfolio Manager/Trader, Carbon Cap – London
- *Carbon Markets Analyst, Carbon Cap – London
- *Climate Change and Energy Advisor, Mineral Products Association – London
- *Senior Technical Specialist, Blue Carbon Climate & Nature Linkages, Fauna & Flora International – Cambridge/Remote (UK)
- *Director, Plastics and Sustainable Development Markets, Verra – Remote
- *Northeast Director, Family Forest Carbon Program, American Forest Foundation – Northeast US
- *Carbon Project Developer, ClimatePartner – Munich
- *Carbon Project Developer, Nature-Based Solutions, ClimatePartner – Munich
- *Senior Consultant Carbon Market Mechanisms, Carbon Limits – Oslo/Remote
- *Portfolio Manager, Carbon Compliance Markets, Lombard Odier Asset Management – New York/London/Geneva
- *Manager, REDD+ Technical Innovation, Verra – Remote
- Vice President, Global Carbon Markets, Climate Finance Partners – Remote (Global)
- Junior Regional Marketing Specialist, DACH, South Pole – Berlin
- Senior Adviser, Climate and the Environment, Abt Australia – Canberra
- Manager/Senior Manager, Energy Sales & Origination – Commodities Markets and Finance – Commodities and Global Markets, Macquarie – Sydney
- Manager, Commodities & Carbon Risk, Commonwealth Bank – Sydney
- Carbon Consultant, Foxi – Melbourne
- Senior Climate Policy Manager EU, Climeworks – Brussels
- Senior Climate Policy Manager USA, Climeworks – Washington DC
- Policy Manager, Carbon Gap – Remote (UK, London preferred)
- Forest Carbon Project Manager, The Climate Trust – Remote
- Forest Carbon Analyst, The Climate Trust – Remote
- Lawyer, Climate Change Policy & In-House Counsel, Bioeconomy – Remote
- Forest Carbon Project Manager, Carbon Project Development Team, Bioeconomy – Remote
- Senior Carbon Technical Expert, Forest Carbon Team, Bioeconomy – Remote
- Social/Community Expert, Project Development Team, Bioeconomy – Remote
- Junior Carbon Portfolio Analyst, Quadriz – Madrid/Las Palmas/Remote (Spain)
Or click here to see all our listings
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
BITE-SIZED UPDATES FROM AROUND THE WORLD
Manchin Mondays – US Sen. Joe Manchin (D), who blocked the passage of his own party’s Build Back Better (BBB) climate and social spending policy package in December, has re-engaged in discussions with President Joe Biden administration on a new slimmed-down version of the bill, CNN reported Friday. But Manchin on Monday reiterated his opposition to the budget reconciliation scheme, disputing the report that he is ready for a new round of negotiations. In an interview with radio network West Virginia MetroNews, Manchin called an E&E news report that he and his Democratic colleagues could work by the end of May on a new, slimmer version of BBB “complete fiction.” Manchin questioned the report’s sourcing and said any plan to bypass typical Senate procedure for new welfare programmes is out of the question. The senator said his primary focus remains on US fossil fuel independence in the wake of Russia’s invasion of Ukraine. (Free Beacon)
Budget breakdown – Biden released his Fiscal Year 2023 budget on Monday, requesting $11.9 bln for work at the EPA. The budget would invest an additional $110 mln in grants to states and Tribes to support on-the-ground GHG reduction efforts, and an additional $35 mln to phase out high global-warming potential HFC gases under the American Innovation and Manufacturing Act. The budget request comes less than a month after the passage of the FY 2022 package, which included increased appropriations for the Energy and Interior departments as well as the EPA. But partisan fighting over topline spending meant several newly authorised programmes under the bipartisan infrastructure package didn’t get appropriated, and spending levels fell far below Biden’s initial requests to the chagrin of environmentalists. While renewable energy, energy efficiency, and low-carbon transportation investments got a $338 mln boost in the recent spending package relative to fiscal 2021, it was 32% less than Biden’s request last year. (Politico)
Crypto consultation – The White House science office is seeking input about climate harm from expanding use of cryptocurrencies and ways to tackle the problem. The Office of Science and Technology Policy (OSTP) on Friday issued a formal “request for information” that solicits feedback by May 9. OSTP wants info on “protocols, hardware, resources, economics, and other factors that shape the energy use and climate impacts of all types of digital assets.” OSTP is also interested in ways crypto can help battle global warming, such as how digital assets can provide new opportunities in natural asset and carbon accounting, and greater trust in carbon measurement. (Axios)
Bad timing – The premiers of Canada’s prairie provinces are calling on Prime Minister Justin Trudeau to skip this week’s raising of the federal carbon tax. “This is the worst possible time to increase energy costs on Canadians,” Alberta Premier Jason Kenney tweeted on Monday. He co-signed a letter to Trudeau along with Saskatchewan Premier Scott Moe and Manitoba Premier Heather Stefanson urging the PM to postpone the increase in light of the soaring cost of living. The federal backstop carbon tax is due to rise by C$10/tonne on Apr. 1 to reach C$50, resulting in higher prices on natural gas bills and at the pump.
Having a cow – California regulator ARB on Monday released its Final Analysis of Progress toward Achieving the 2030 Dairy and Livestock Sector Methane Emissions Target. SB-1383 sets a 2030 methane emissions reduction target for this sector of 40% below 1990 levels, or a drop of 9 MtCO2e. The analysis shows the sector is projected to achieve just over half of the annual reductions necessary to achieve the 2030 target through modifications to manure management systems – primarily using anaerobic digesters – and additional reductions through decreases in animal populations. To meet the 2030 target, the dairy and livestock sector will need to achieve considerable emissions reductions from additional manure management projects, proven enteric mitigation strategies, or a combination of both over the next few years, the report added.
Rvo, rvo, rvo your boat – US-headquartered International Continental Exchange (ICE) on Monday announced the launch of two Renewable Volume Obligation futures contracts. The US EPA’s Renewable Fuel Standard (RFS) mandates the incorporation of renewable fuels into transportation fuel. Each year, the EPA outlines the volume requirements for each renewable fuel category and sets those volumes through the annual renewable volume obligation (RVO). As a result, obligated RFS refiners and importers need a means to hedge their RVO exposure, and ICE has launched the RVO (OPIS) Current Year Future & Argus RVO Current Year Future, based on the OPIS and Argus daily price assessments. Each futures contract is equivalent to 50,000 gallons.
The humblest of beginnings – Japanese trading house Marubeni has purchased credits from an eelgrass and sargassum bed project under Japan’s fledgling blue carbon programme, it said Monday. The credits will be used to sell shipments of so-called “carbon neutral” chemicals, including ethylene, propylene, and butadiene. However, the Yokohama-based project was only issued with 19.4 credits, of which Marubeni bought 9.7, meaning the vast majority of credits backing those carbon neutral shipments will have to come from other projects.
Foiled funding – The Australian Senate has delivered a pre-election blow to the coalition government’s energy policies, cancelling out controversial regulations that sought to redirect funds from renewable energy technologies to those it preferred, including carbon capture and storage, Renew Economy reports. Notably, for the Morrison government, the blow was delivered by one its own, a conservative senator who had threatened to cross the floor in what would have been a humiliating outcome. The controversial regulations for the Australian Renewable Energy Agency (ARENA), issued by federal energy and emissions reduction minister Angus Taylor, attempted to expand the responsibilities of ARENA and redirect its funds to carbon capture and storage projects, and a range of non-renewable energy policies. This included the ‘Future Fuels’ fund, soil carbon, and a range of grants to improve freight transport productivity. ARENA will revert to an earlier set of regulations that limited the agency to only using its funding to support the development of new renewable energy projects and technologies.
Aem chat – California-based renewable fuels company Aemetis on Friday announced an agreement with Finnair for 17.5 mln gal (66.2 mln L) of blended sustainable aviation fuel (SAF) over a seven-year term. The blended fuel to be supplied to the Finnish airline under the agreement will be 40% SAF and 60% Petroleum Jet A to meet international blending standards.
Saving race – The European Commission is revising the economic assumptions behind its energy and climate laws package presented last year, saying sky-high gas prices fuelled by the war in Ukraine have strengthened the case for more ambitious energy efficiency goals. Brussels tabled a revision of the energy efficiency directive last year, introducing new targets to reduce primary (39%) and final (36%) energy consumption by 2030, becoming legally binding at the EU level. The current target – of 32.5% overall by 2030 – is non-binding, leading to criticism that the EU was being too soft on enforcement. Discussion on the recast directive is currently ongoing in the European Parliament and the EU Council of Ministers, sources said. Previous estimates found that the economic potential of energy efficiency gains were 5% lower than the technical potential, meaning it was too costly to aim higher. But with gas prices now likely to remain high long-term, Commission officials aid those assumptions need to be revised. In the European Parliament, there is an appetite to aim higher, with lawmakers proposing “a reduction of 43% for final and 45.5% for primary energy consumption, respectively,” higher than the Commission’s initial proposal. Experts say every percentage point gained in energy efficiency cuts Europe’s gas imports by 2.6%. (Euractiv)
Clean start – Renewable power installations covered more than half of Germany’s power consumption in the first two months of 2022. Figures released by energy industry association BDEW and the Centre for Solar Energy and Hydrogen Research Baden-Wurttemberg (ZSW) showed that wind turbines, solar panels and other renewables contributed 54% of power consumption in January and February. These installations produced about 25% more electricity than in the same period a year before. “The increase is mainly due to favourable weather conditions for power production with wind and sunshine,” BDEW and ZSW said. With an output of 20.6 bln kWh, February 2022 also ended up being a new record month for wind power production in the country. In that month alone, renewables covered 62% of total electricity consumption. (Clean Energy Wire)
Brit blocks – The UK government plans to take a 20% stake in a £20 bln large-scale nuclear plant at Sizewell, with developer EDF taking another 20%, the BBC reports. Ministers hope the confirmation of the two cornerstone investors will encourage infrastructure investors and pension funds to take up the remaining 60%. However, the FT reports that the UK’s upcoming energy strategy is likely to be delayed again from this Wednesday as PM Boris Johnson clashes with finance minister Rishi Sunak, who continues to hold out against big new spending commitments. Officials close to the process said they did not expect an announcement this week and that Apr. 4 was now the earliest date. Separately, the UK’s National Grid has agreed to sell a controlling stake in its gas transmission network to Australian bank Macquarie, the FT reports. The bank will pay £4.2 bln for the stake and has promised “significant” investment to “upgrade it for a green economy”.
Webinars – The UK ETS Authority will be hosting a series of workshops to provide a high-level overview of the recently published consultation. The aim of the workshops will be to:
- Provide an overview of each of the nine chapters in the consultation.
- Run through next steps (how to use Citizen Space and future engagement).
- Provide an opportunity for stakeholders to ask questions and share feedback (noting that more in-depth sessions will be held in due course).
These workshops will take place on Microsoft Teams, and each session will have a maximum capacity of 45 attendees. Each workshop will be the same. Register here
Where’s the (carbon-neutral) beef? – Brazil meatpacker Minerva said on Monday it has signed an agreement with Biofilica Ambipar Environmental Investments to develop a joint venture on carbon projects. The initiative aims to implement carbon projects in the meat supplier chains in South America, and the projects will result in carbon credits that could be traded in appropriate markets, the company said in a securities filing. (Reuters)
SCIENCE & TECH
Off the shelf – Another massive ice shelf has collapsed in Antarctica, satellite imagery shows, following record high temperatures in the region. The Conger ice shelf, now identified as iceberg C-38, broke off in the Wilkes Land region, the US National Ice Center said on Mar. 17 after temperatures hit a record high of 11 F (-11.8 C) at Concordia station, more than 40 degrees Celsius above normal. It is believed to have been about 1,200 square km, around the size of Los Angeles, and hit a tipping point during a mid-month heatwave and atmospheric river, NASA scientist Catherine Colello Walker tweeted. It is viewed as a significant event, but unlikely to have ripple effects that are widely felt. (Bloomberg)
Not ok, boomer – Baby boomers, or those born between 1946 and 1965, are the world’s worst polluters with the biggest carbon footprint, The Times reports, citing research from the Norwegian University of Science and Technology. It says that boomers are the most likely age group to take overseas holidays, live in large houses, and spend more on technology and gas-guzzling cars. In 2005 the over-60s accounted for 5% of GHGs, but by 2015 that proportion had grown to 33%.
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