One week until Carbon Forward 2022 – Europe’s leading environmental markets conference. Taking place in London and online from Oct. 12-14, don’t miss the chance to hear about the risks and opportunities presented by the world’s largest carbon markets – compliance and voluntary. Or come network with your industry peers and meet our sponsors and exhibitors.
In-person passes are limited and going fast, so Register Now!
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Presenting CP Daily, Carbon Pulse’s free newsletter. It’s a daily summary of our news plus bite-sized updates from around the world. Subscribe here
TOP STORY
Nord Stream methane leak threatens to blow hole in EU emissions coverage
The methane leaks from the Nord Stream pipelines may escape EU emissions coverage amid uncertainty surrounding the alleged sabotage, experts suggested this week, meaning GHGs estimated as equivalent to the annual emissions of Denmark may evade accountability.
EMEA
EU nations seek to raise 75% of €20 bln-worth REPowerEU from Innovation Fund, torpedo MSR sale idea
EU finance ministers on Tuesday endorsed a unified stance to partly finance the REPowerEU strategy by sourcing the greatest chunk of the €20 billion from the Innovation Fund and the remaining portion from frontloaded member state auctions, in turn finally discarding the idea of MSR-held sales.
Euro Markets: EUAs post €1 gain in thin trading as market mulls opposing REPowerEU funding proposals
EU carbon prices posted a €1 gain on Tuesday after trading mostly higher as the market considered reports that suggested EU institutions remain at odds over how to fund the REPowerEU initiative.
Utility RWE confirms bringing forward phaseout of lignite generation by 2030
German utility RWE on Tuesday confirmed plans to end its lignite-based power generation in 2030, reaching a deal with Berlin to align with the government’s coal phaseout date even as the company receives state funding to bring coal operations out of reserve in the meantime.
Removals may be EU ETS “blind spot” with 2040 zero emissions target coming into sight -experts
Integrating carbon removals into the EU ETS will be essential to meet the current near-zero emissions goal by 2040, with the issue a “blind spot” in light of its current lack of attention ahead of crunch reforms due by the end of the year, an event heard on Tuesday.
VOLUNTARY
No time to waste: Curbing garbage can cut CO2, methane emissions -report
Introducing zero waste systems in cities around the world would be one of the quickest and most affordable ways to reduce CO2 and methane emissions, a report published on Tuesday found, with the potential to save 1.4 billion tonnes of CO2e from the waste sector alone.
Puro.earth opens consultation for rock CO2 storage crediting methodology, unveils removals insurance partnership
Nasdaq’s carbon removals platform Puro.earth has opened a consultation on a methodology to earn carbon credits from accelerating the process of CO2 being stored by rocks, while it also this week announced a new removals insurance partnership.
Carbon standards body set to issue first credits, rolls out new ARR methodology
A certifier expects to issue its first credits in the voluntary carbon market (VCM) this month, it revealed Tuesday as it rolled out a new methodology for forestry conservation that will quantify greenhouse gas removal.
Offset ratings firm awards high grade to urban forestry project
One of the world’s few urban forestry offset projects to date has been awarded high marks by a ratings agency this week, while two cookstove schemes have had their ratings reaffirmed.
ASIA PACIFIC
AU Market: ACCU traded volume surges, price slides
Traded volumes in Australian Carbon Credit Units (ACCUs) surged in the September quarter, while the carbon credit price came off as the market waits for the outcome of the government review and Safeguard Mechanism reforms.
Australian ACCU reforms must prepare for maturing market, industry body says
An industry body has called on the Australian government to prepare its carbon market for greater activity and demand, while at the same time emphasising it should be treated as just one integral piece of the larger puzzle of cutting emissions.
INTERNATIONAL
Renewables generation growth flattens H1 ’22 global power sector emissions -report
Steady year-on-year growth in renewables generation was enough to meet the rise in global electricity demand in the first half of 2022, enabling global power sector emissions to be unchanged from the same period last year, according to analysis from an energy and climate think-tank released on Wednesday.
Shift from coal to gas-fired power threatens global climate policy goals, report says
Efforts to decarbonise the power sector by shifting away from coal-fired generation are at risk due to an apparent pivot towards gas, with nearly 90 GW of gas plant capacity in the global development pipeline being coal-to-gas conversions or replacements, according to a report released on Tuesday.
AMERICAS
EV charging station owner to appeal fraud allegations in Oregon Clean Fuels Program
The CEO and owner of an electric vehicle company recently charged with committing Oregon Clean Fuels Program (OCFP) fraud by the Department of Environmental Quality (DEQ) and facing a multi-million-dollar penalty – the largest in agency history – said on social media Tuesday that he plans to file an appeal.
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CONFERENCE
One week until Carbon Forward 2022 – Europe’s leading environmental markets conference. Taking place in London and online from Oct. 12-14, don’t miss the chance to hear about the risks and opportunities presented by the world’s largest carbon markets – compliance and voluntary. Or come network with your industry peers and meet our sponsors and exhibitors. In-person passes are limited and going fast, so Register Now!
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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
Funding spat – A landmark $8.5 bln deal to help wean South Africa off its dependence on coal is hanging in the balance amid fraught negotiations with rich donor countries over how the funds should be spent, Bloomberg reports. The climate finance deal, unveiled at COP26 last year, was hailed as a prototype for helping other coal-dependent developing countries transition to cleaner energy sources. Its success or failure could have a knock-on effect at next month’s COP27 summit in Egypt, which is expected to focus on the financing needs of poorer countries adapting to a warming atmosphere. South Africa, which relies on coal for more than 80% of its power and is the world’s 13th-biggest source of GHGs, is pushing for cheaper money in the form of grants and low-interest loans, people familiar with the talks said, declining to be named as negotiations are private and ongoing. One key factor holding back the deal is the lack of detail South Africa has given on how it will spend the money its partners – the US, UK, France, Germany and the EU – will invest, the people said. Negotiators have been aiming for the UN summit as a deadline, mindful that climate deals often come down to the wire. Key stakeholders are privately expressing confidence that some version of the South African finance plan will be ready.
EMEA
Going off the rails – Record-breaking electricity prices across Europe are damaging the continent’s attempts to build a reliable low-carbon supply chain and reach its decarbonisation targets, as solar and battery manufacturers face mounting costs. Rystad Energy research shows that 35 GW of solar PV manufacturing and more than 2,000 GWh of battery cell manufacturing capacity could be mothballed unless power prices quickly return to normal levels. The energy intensive nature of these manufacturing processes is leading some operators to temporarily close or abandon production facilities as the cost of doing business escalates, the company said. Unless prices turn around soon, Europe’s plans to cut dependence on imported fossil fuels by boosting installed renewable generation capacity and EV usage could be derailed, Rystad added.
ASIA PACIFIC
On track — Fortescue Future Industries has announced an agreement with Deutsche Banh to work together on using green hydrogen and ammonia-based fuels in rail applications. FFI said Tuesday that it would participate in Deutsche Banh’s research and development into a carbon free internal combustion engine, which could ramp up its Green Fleet rail delivery programme. The agreement follows a MoU signed between the two companies which focussed on working together on decarbonisation tech opportunities. Earlier this year the two companies announced they would work together to develop the world’s first battery electric iron ore train, with FFI noting that pre-feasibility studies are “progressing”, with the first train expected to be delivered in 2027. FFI CEO Andrew Forrest said he wanted to decarbonise the rail industry through developing multiple technologies.
AMERICAS
More SCOTUS – The US Supreme Court on Monday asked the Justice Department to weigh in on whether state and local climate lawsuits against giant oil companies should be heard in federal courts, Axios writes. The requested brief from the Solicitor General “would offer the Biden Administration’s official position” on the question, ClearView Energy Partners said in a note. Exxon and Suncor have asked the high court to take up the question of venue in local Colorado officials’ suit seeking damages for the effects of global warming. Many similar lawsuits against oil companies are unfolding nationwide. State and city officials have filed in state courts, which are considered a friendlier venue. Oil companies contend the lawsuits should be heard in federal courts, arguing climate policy is a matter for Congress and the executive branch. “Ad hoc and unpredictable decisions of individual state courts, seeking to govern the worldwide conduct of a handful of individual defendants, are not a sensible way to address issues of this scope and magnitude,” the American Petroleum Institute said in a filing supporting the Exxon-Suncor petition. (Axios)
Greening ethanol – Carbon capture and sequestration (CCS) project developer Carbon America announced an agreement on Monday with ethanol producer Bridgeport Ethanol to develop a CCS project capturing 175,000 tonnes of CO2/year, or 95% of total emissions, from an ethanol production facility in Nebraska. According to a company press release, this project is Carbon America’s third CCS agreement in 2022. The sequestration site near the Nebraska ethanol plant will be rigorously designed to comply with Federal Class VI and California Air Resource Board Low Carbon Fuel Standard Permanency requirements, the company stated. Carbon America is working closely with the US EPA and multiple Nebraska regulatory agencies to ensure the project meets all environmental regulations. The first CO2 injection is expected to begin in 2024.
VOLUNTARY
The magic number – Carbon removal service buyers and sellers are focused on one metric: $100 per tonne, Protocol reports. It’s one of Frontier’s stated criteria that the fund uses to evaluate its advance purchases. In a survey of the long-duration carbon removal community, CarbonPlan found that stakeholders are focused on the $100 benchmark. The US Department of Energy even announced that it would be investing in carbon removal research to bring the cost of the technology down to $100/t. But where did that number come from? In short, it’s the cost per tonne of removal services that it would take for the CDR industry to reach commercial viability. And it’s based on a handful of factors, including being the point at which carbon removal becomes affordable at the scale needed to make it a meaningful tool to reach net zero. It also evolved from modelling and policy conversations, and is aligned with other existing costs, like the EU carbon price and the US social cost of carbon. But another reason could be much simpler: the climate community could just be taking its cue from the DOE, anchoring its own targets to the agency’s 2021 Carbon Negative Shot target, which was set for $100/t, CarbonPlan’s Danny Cullenward said. So far, no one has come anywhere close to reaching that target, with existing initiatives costing well above that, although the Inflation Reduction Act’s updated 45Q tax credit of up to $180/t for direct air capture could help some startups get closer to achieving that target.
Blockchain exposure – A tech startup has launched a new blockchain marketplace for high quality offset credits with 23 initial partners. Thallo, a web3 climate startup, has named crypto payment firm Ripple and venture capitalist firm Climate Collective among its founding partners. “Together, we will help make the voluntary carbon market more effective, helping funds go toward high quality projects and making it easier for companies to achieve their sustainability goals in a transparent and verifiable way,” said Joseph Hargreaves, Thallo co-founder.
SCIENCE & TECH
Carbon capture extravaLanza – Chicago-based LanzaTech has formed a funding partnership with Brookfield Renewable, and its institutional partners, to co-develop and build new commercial-scale production plants that will employ LanzaTech’s CCT (Carbon Capture and Transformation) technology. The funding partnership commits an initial $500 mln to be invested by Brookfield Renewable in constructing and operating new CCT projects that have achieved certain pre-agreed milestones. Brookfield will be LanzaTech’s preferred capital partner for LanzaTech CCT opportunities in Europe and North America. Following initial investments totalling $500 mln, Brookfield could commit to making an additional $500 mln available for investments in the strategic partnership if sufficient projects are available at the agreed milestones. Brookfield will also invest $50 mln in LanzaTech to support further corporate development. (Reuters)
AND FINALLY…
I don’t like the sound of that Class VI – Texas is asking the US EPA for authority to issue permits for CO2 wells for geologic storage, in a bid to turn the nation’s largest emitter into a hub for the growing carbon capture industry. The Texas Railroad Commission, which oversees the state’s oil and gas industry, plans to submit an application to EPA to obtain primary enforcement authority, or “primacy,” over wells that are used to inject CO2 deep into underground formations. If successful, the Lone Star State would join just two other states, North Dakota and Wyoming, to have that authority over so-called Class VI wells. Louisiana also applied for primacy last year. The move comes as EPA, which maintains primacy in all other states and territories, faces criticism for the lengthy permitting process for Class VI wells, which are used for long-term geologic storage of CO2). Supporters of carbon capture believe that granting more states primacy could help speed up the process – especially as more companies seek to build such wells to take advantage of expanded tax incentives in the new Inflation Reduction Act. (E&E News)
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