CP Daily: Thursday June 23, 2022

Published 04:13 on June 24, 2022  /  Last updated at 04:13 on June 24, 2022  /  Newsletter  /  No Comments

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

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TOP STORY

EU nations seek to delay ETS2, discard ‘diversified’ approach -leaked draft

EU nations are sticking to their line that the proposed carbon market for transport and buildings should be delayed by a year to 2027, according to the latest leaked draft seen by Carbon Pulse on Thursday, a week ahead of when the governments are due to reach a united position on several climate bills.

EMEA

Germany’s recourse to coal to raise EU power sector emissions by 5% in 2023 and 2024 -analysts

Germany’s decision to delay the retirement of coal plants scheduled to close and re-activate reserve capacity could push EU power sector emissions 5% higher over the next two years, according to a modelled report from analysts at an energy consultancy.

Euro Markets: Carbon claws back Wednesday’s losses amid renewed hedging demand after options expiry

EU carbon prices broke out of a very narrow morning range on Thursday as utilities resumed forward hedging after the previous day’s expiry of options contracts, while energy prices surged as Germany announced plans to reward industry for cutting gas use amid further tightening in Russian supplies.

Norway awards $112 mln to build hydrogen maritime hub as part of green growth push

The Norwegian government has upped plans to create a hydrogen maritime hub along Norway’s eastern seaboard, awarding grants of 1.12 bln NOK ($112 mln) to 12 initiatives, it announced Thursday as part of a 60 bln NOK economy-wide roadmap for green industrial growth.

AMERICAS

California public hearing on Scoping Plan runs over amid protests

The California Air Resources Board (ARB) held a public hearing on Thursday on the proposed 2022 Scoping Plan as well as on its draft environmental analysis, with the meeting running over its scheduled time following a brief disruption from environmental campaigners.

NA Markets: CCAs continue to trade with macro sentiment, RGGI market immune

Similar to last week, California Carbon Allowance (CCA) prices continued to trade in line with broader macroeconomic weak sentiment across financial markets, while RGGI Allowances (RGAs) remained fairly immune to market gyrations.

Bahamas govt drafts exchange legislation in drive to become global centre for carbon trading

The Bahamian government is drafting legislation to establish a carbon exchange on the archipelago, in its campaign to become a “global centre” for emissions trading.

ASIA PACIFIC

BHP wants offsets for carbon stored in mine waste dams, but additionality questions loom large

Australia’s Clean Energy Regulator is investigating the possibility of making the capture and storage of carbon in minerals eligible to earn Australian Carbon Credit Units (ACCUs), championed by miner BHP, as early as 2023.

Green group sues consultants caught faking China ETS data

The China Environmental Protection Foundation has filed a civil lawsuit against a Beijing-based consultancy caught faking ETS data twice, accusing the company of maliciously reducing the cost of emitting carbon and negatively impacting China’s efforts to meet its climate change ambitions.

INTERNATIONAL

Over $1 trillion of oil and gas assets at risk of being “stranded” by energy transition, report says

Global stock markets are financing energy companies that own three times more coal, oil, and gas reserves than can be burned without breaking the Paris climate agreement’s target to limit global warming to 1.5C, raising the risk of stranded assets for the financial sector, a report released on Thursday claimed.

VOLUNTARY

Crypto carbon firms decry Verra delays to consultation on tokenisation

Crypto carbon firms are voicing their disappointment with Verra over a delay to consultations on tokenising retired credits, with the hold-up already stretching for more than two weeks following the standard manager’s effective ban on the practice.

Finance firm offers developer profit share for rising carbon credit prices

A carbon financing company is offering project developers a guaranteed floor price for their carbon credits and a profit share if market prices start to rise, in a move that could counter criticism of profiteering in the voluntary carbon market.

US-headquartered forest restoration OS firm raises $17 mln in seed funding

A US-based firm that has developed an ‘operating system’ for forest restoration efforts has raised $17 million in seed funding.

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CONFERENCES

Climeworks’ DAC Summit – June 30 in Zurich/online: Carbon removal and Direct Air Capture technologies have been experiencing a watershed moment in recent months.   Scientists have deemed them indispensable in the latest IPCC report, governments have stepped up their funding and policy efforts, and investors have committed large amounts to scale up. Where does the industry stand today, and what are its recent most promising developments? What are the requirements and immediate next steps for scaling up at the required speed? And when the industry works together, what could the future look like? The Summit provides a unique opportunity to get answers to these questions from DAC insiders and experts. Register here

Argus Carbon Markets and Regulation Conference – June 30-July 1 in Lisbon, Portugal: The event will deliver critical updates on regulation, the future of the EU ETS, and key developments in the voluntary carbon markets space, amongst other topics that will be tailored for the European and global audience. Featuring panel discussions, fireside chats, presentations, and collaborative problem-solving sessions. Participates will gain knowledge and insight from expert opinions and take advantage of the opportunity to network and discuss with their industry peers in-person for the first time in two years. CP Daily subscribers can get a 15% discount by registering with the code CARBONPULSE15: https://bit.ly/3t4CmH6

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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

INTERNATIONAL

Cement increments – CO2 emissions from cement making have doubled in the last 20 years, according to global data from the CICERO and the Global Carbon Project. It says cement emissions reached nearly 2.6 bln tonnes of CO2 in 2021, up from 1.2GtCO2 in 2002. China is key because it produced more than half of the world’s cement in 2021, with India a distant second at about 9%. (Associated Press)

EMEA

Cut it Agricole – Credit Agricole will cut its financing of emissions produced by the oil and gas sector and some other highly polluting industries and is expanding its advisory services around new forms of energy, even as the Ukraine war sparks a pivot back to fossil fuels. France’s second-biggest listed bank issued a strategy update on Tuesday that warned of an “opaque” and unsettling environment in the short term, marked by multiple crises including supply chain chaos and high energy prices. But the group said it would focus more than ever on decarbonisation strategies, including investing in renewable sources of power and rolling out services to help companies switch to less carbon intensive forms of energy. It did not outline a specific budget or hiring plan. Emissions produced in the oil and gas sector and financed by Credit Agricole will fall 30% by 2030, while the intensity of the emissions it finances in the car industry will drop by half. It said it was examining its strategy in aviation, real estate, agriculture and shipping too. (FT)

Rebate runovers – The uniform “climate money” payments to every German citizen promised in the coalition agreement from revenue raised via Germany’s nEHS carbon pricing programme for buildings and road transport will not come until 2024 at the earliest and only then provided there is any money left in the climate and transformation fund, according to German finance minister Christian Lindner. The programme was launched in 2021 but the lack of payment method is the basic problem: so far there is no transfer mechanism through which the state can pay out such climate money to all 83 million citizens. (Die Welt)

High-grade baking soda – Tata Chemicals Europe this week opens the UK’s largest carbon capture plant at its site in Northwich following a £20 mln investment, including £4 mln from the government. CO2 emissions from a power plant in Cheshire are being used to make sodium bicarbonate for kidney dialysis after being processed at Britain’s first industrial-scale carbon capture and usage plant. Tata’s existing gas-fired combined heat and power plant at the site generates steam and electricity for its factories that produce sodium carbonate, used in glass manufacturing, and sodium bicarbonate, also known as baking soda. Tata makes sodium bicarbonate from its sodium carbonate through a process that involves adding CO2, and the high-grade end product is used in dialysis for kidney patients and pharmaceutical applications. (The Times)

But green light for UK coal – An article by BBC News picks out a brief response from British PM Boris Johnson in parliament yesterday, regarding a proposed new coal mine in Cumbria. It quotes Johnson saying: “We can all be proud of the way in which we reduced CO2 emissions in this country, but plainly it makes no sense to be importing coal, particularly for metallurgical [steelmaking] purposes, when we have our own domestic resources.” (Carbon Brief)

ASIA PACIFIC

Jakarta jam – Indonesia’s carbon tax, due to take effect next month, could be delayed until later this year due to global economic conditions and to give authorities time to prepare for it, Febrio Kacaribu, the head of the finance ministry’s fiscal policy office, told Reuters. Indonesia had already delayed the tax to July from June, and before that from April. Read Carbon Pulse’s analysis on Indonesia’s carbon tax and pilot ETS.

Billions needed – India will need $223 billion of investment to meet its goal of wind and solar capacity installations by 2030, according to a new report by research company BloombergNEF, Economic Times reports. The government has set a target of increasing non-fossil power capacity to 500 GW by 2030. It wants non-fossil fuel power sources to provide half of its electricity supply by 2030. “To achieve this target, India needs to massively scale up funding for renewables,” the report said, adding that $223 billion is required over the next eight years just to meet the solar and wind capacity targets.

Combating corrosion – Petronas and Curtin University in Western Australia have entered into a research partnership to jointly address one of the costliest forms of corrosion in the oil, gas, and petrochemical industries, it was announced by both partners. In line with both parties’ sustainability goals, the collaboration strives to discover innovative solutions for corrosion mitigation to reduce carbon footprint and operational expenditure. Corrosion Under Insulation (CUI) is often said to be among the costliest forms of corrosion in the industry. Studies have shown that the petrochemical industry spends about 10% of its total maintenance and repair budget on piping systems and pressure vessels for insulation-related corrosion.

Doing its bit – The Western Australian state government is taking the next step in achieving net zero greenhouse gas emissions by committing to a whole-of-government 2030 reduction target of 80% below 2020 levels, the premier, Mark McGowan said on Thursday. This interim target of 80% below 2020 levels applies to emissions from all government agencies across the state, including transport, health and education, and emissions generated by government trading enterprises.

Hydrogen for the red dot – Industrial gas supplier Linde is working with data centre company STT and utility YTL to explore the use of hydrogen energy in Singapore. Linde, which has a multi-billion dollar hydrogen business, has signed the agreement to work on a hydrogen energy proof of concept to boost Singapore’s sustainability efforts, Datacentredynamics reports. Singapore’s goal to be a digital hub is in conflict with its lack of renewable energy. Data centers using more than 7% of the nation’s electrical power, which is almost entirely generated from fossil fuels. From 2019, Singapore had a moratorium on new data centers, which was formally lifted in January 2022, although only small amounts of new capacity will be allowed for now.

Coal aid cut – Japan will stop providing yen loans for the construction of coal-fired power plants in Indonesia and Bangladesh, the government announced on Wednesday. The Nikkei Asia reports that the Japanese government was funding the Indramayu plant in Indonesia and the Matarbari plant in Bangladesh, but has reversed that decision following criticism that it was exacerbating global warming. Indonesia and Bangladesh were conducting surveys for the projects with Japan’s backing, but neither cases had reached construction. A government spokesperson said Japan would continue to assist developing countries in the quest for a decarbonised society.

VOLUNTARY

Commod bods – Certifier Gold Standard has released guidance aiming to unlock climate action in supply chains and boost the value of low-carbon commodities. It said the guidance informs proper greenhouse gas accounting that allows standards like the Forestry Stewardship Council and Better Cotton to embed carbon value in certified commodities and enables corporate buyers to reduce supply chain emissions and make concrete progress toward Net Zero targets.

You want offsets with that? – Energy decarbonisation software provider WattCarbon has partnered with carbon credit marketplace Cloverly to enable its customers to more easily source offsets for their operations. WattCarbon provides automated hourly carbon emissions reporting for buildings and energy assets and the partnership will enable its clients to achieve net-zero status immediately via Cloverly’s API feed, the companies said in a press release.

AVIATION/SHIPPING

SAF deal – Finnair will be using Sustainable Aviation Fuel (SAF) to power its flights from Califonia. The Oneworld Alliance member has signed a new agreement with Colorado-based renewable fuels producer Gevo to provide the fuel on the carrier’s flights departing from Los Angeles. The agreement will come into effect in 2027 and provide for the purchase of seven million gallons of SAF annually for the following five years. The deal is expected to be valued at $192 mln over the five years and result in reduced emissions during production and consumption compared to traditional jet fuel. The move is part of a more extensive campaign by Oneworld to realise net zero emissions by 2050. The alliance has previously announced a plan to purchase up to 200 mln gallons of sustainable aviation fuel annually from Gevo. The SAF will go to fuel oneworld aircraft operating from California airports for five years. (Simply Flying)

SCIENCE & TECH

Power-to-liquids partnership – German aircraft manufacturer Deutsche Aircraft and South African chemicals and energy company Sasol have signed a MoU on advancing technology for green hydrogen-based Power-to-Liquids-SAF (PtL-SAF) in aviation, Asia One reports. Sasol ecoFT and Deutsche Aircraft have both recognised the urgency in transitioning towards climate neutral aviation. The two companies thus plan to foster the certification of sustainable drop-in and non-drop-in jet fuels, more particularly the ramp-up of PtL-SAF for aviation.

AND FINALLY…

Uninsurable sunshine – On June 29, FedNat Insurance Co. will cancel 68,200 Florida homeowners’ insurance policies, in just one in a series of coverage drops that is threatening the state’s economy and leaving Floridians scrambling to insure their homes as hurricane season ramps up. The 2022 Atlantic hurricane season is expected to be busier than normal with at least three major hurricanes. “This is not a survivable market. Homeowners cannot find coverage,” Mark Friedlander, of the Insurance Information Institute, said in a recent webinar. Four insurance companies have gone into receivership since February and at least one more has failed to secure required reinsurance backing. The flight of private insurers from the state has pushed 883,000 homeowners to buy insurance from Citizens Property Insurance Corp., the state’s insurer of last resort. That’s more than twice as many as three years ago. Nearly half of Citizens’ exposure is in three hurricane-prone southeast Florida counties and a major hurricane could potentially wipe out the programme’s reserves and force millions of residents to pay an insurance surcharge. (Climate Nexus)

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