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COP27
China eyes Article 6 credits to boost ETS offset supply -govt advisor
China is open to using international carbon credits generated under the Paris Agreement’s Article 6, predominantly from Belt and Road Initiative (BRI) countries, to boost the supply of offsets in its national emissions trading scheme, a key carbon market advisor to the Chinese government told a side event at COP27 Tuesday.
INTERVIEW: NZ seeks to form “bespoke” bilateral partnerships to meet NDC gaps, minister says
New Zealand will look to secure bilateral partnerships with Asia Pacific nations for the purchase carbon credits to count towards its national climate targets in a move that could see the country source as many as 100 million credits under such agreements, but its climate minister says arrangements are still in the early stages.
Cambodia secures deals with corporates for 10 mln REDD+ credits
Cambodia’s ministry of environment has signed contracts with a group of international corporate buyers for over 10 million tonnes of verified emission reductions from three REDD+ projects.
Bahamas targets 9 Mt in blue carbon sales by 2030, to seek new route to market after FTX collapse
The Bahamas could sell up to 9 million blue carbon credits by 2030, but the country’s route to market will need to change as it has previously planned to sell units on now-collapsed cryptocurrency exchange FTX.
Is CBAM bad for climate multilateralism?
The EU’s proposed carbon border measure was discussed at several events on the sidelines of the COP27 UN climate negotiations on Tuesday, with experts debating whether the policy aligns to the multilateralism spirit of the Paris Agreement.
Canada, Chile announce initiative to triple CO2 pricing coverage by 2030
Canada and Chile have launched a new initiative that aims to triple carbon pricing emissions coverage across the globe, the environment ministers from each country announced at a COP27 side event on Tuesday.
Italy wants to achieve its renewables ramp-up in half the time
The newly appointed Italian minister of the Environment and Energy Security, Gilberto Pichetto, has declared his goal to accelerate the country’s green transition in his first appearance at a climate UN summit.
EU confirms to UN talks that it will raise climate ambition
The EU’s climate chief Frans Timmermans to the COP27 summit on Wednesday that the 27-nation bloc will be able to increase the ambition of its NDC, confirming a stance set out by ministers last month.
Turkey to bid to host COP31, Czechia and Brazil reported to seek 2024-25 climate summits
Turkey has emerged as a bidder to host the COP31 global climate summit, putting up a challenge to Australia and the Pacific Islands, which were thought to have been the sole contender to hold the talks in 2026 up until now, while Czechia and Brazil are reported to be respective candidates for COP29 and 30.
Turkey announces higher emissions goal and peak year in revised NDC
*Updates Monday’s article in CPD with further details from official announcement*
Turkey announced an updated NDC on Tuesday, with the government pledging to the UNFCCC a 41% emissions cut target beneath business as usual levels by 2030 and for the first time declaring a year when its emissions will peak.
Roundup for Days 9 – Nov. 15
It’s Tuesday of week two at COP27 in Sharm el-Sheikh, and Carbon Pulse rounds up today’s other news and announcements from the summit. Timestamps in local time (EEST, GMT+2).
AMERICAS
PREVIEW: Q4 WCI auction result geared for fewer surprises
Market participants’ expectations coalesced around a narrow range for the last WCI cap-and-trade market auction for the year, with few expecting the auction to harbour too much of a surprise reminiscent of either last quarter or Nov. 2021.
ANALYSIS: In growing British Columbia’s offset market, new premier faces unmet potential, obstacles
The new premier-designate of British Columbia (BC) could boost carbon offset generation from protecting old growth forests, but doing so would run up against questions about buyer demand and environmental integrity, experts told Carbon Pulse.
Colombia lawmakers advance carbon tax reform bill to throttle offset usage, phase in coal
The Colombian legislature is poised to pass into law sweeping changes to the nation’s roughly $4/tonne carbon fee as part of a historic tax reform package, with provisions to sharply curb the use of offsets in the compliance market and expand the scope of coverage to include coal.
LCFS Market: California prices head to five-year low amid supply glut, PG&E sale
California Low Carbon Fuel Standard (LCFS) credit prices on Tuesday receded back to the lowest since 2017, which traders attributed to the market’s large oversupply and a massive credit sale by utility Pacific Gas & Electric.
ASIA PACIFIC
Indonesia to receive $20 bln to accelerate shift from coal in finance deal at G20 summit
A group of rich countries led by the US and Japan has launched a Just Energy Transition Partnership (JETP) agreement with Indonesia, whereby the Southeast Asian nation will receive $20 billion to shift away from coal generation and target an earlier and lower peak in its power generation emissions, they announced at the G20 summit in Bali on Tuesday.
NZ Market: NZUs rise to new record high on bullish expectations for govt decision
New Zealand carbon allowances have traded at an all-time high over the past two days amid persisting expectations that the government will agree to ETS recommendations made by the independent Climate Change Commission (CCC).
Australia Market Roundup: Regulator approves 11 soil carbon projects as ACCU prices climb
Australia’s Clean Energy Regulator has approved 13 new offset projects, most of them soil carbon schemes, as Australian Carbon Credits Unit (ACCU) prices gather momentum amid an uptick in buying interest and record volume.
China issues sectoral guidelines for non-ferrous metals to peak emissions by 2030
China has published a roadmap for its non-ferrous metals sector to top out carbon emissions by 2030, making the ETS-destined industry the latest in a growing line of similar sectoral guidelines.
China thermal power generation increases in October, despite slower power demand growth
China’s thermal power generation in October was up by 3.2% from a year ago, outpacing a 1.3% gain in overall power output, government data showed Tuesday, though the country’s power demand grew at a slower pace amid gradual economic recovery.
EMEA
Euro Markets: EUAs post robust afternoon gains on macro bullishness ahead of REPowerEU talks
European carbon prices wiped out losses from the last week after an afternoon surge that appeared to be a response to firmer global markets rather than speculative buying ahead of Wednesday’s trilogue negotiations over the REPowerEU initiative, while energy prices rose for a second day as speculative traders covered short positions after a North Sea gas field outage.
Dutch heavy industry “hardly” improving its carbon intensity, says NEa
Dutch heavy industry’s carbon intensity is “hardly” improving compared to European benchmarks, the country’s emissions authority said Tuesday.
VOLUNTARY
Online spat about REDD project over-crediting may be defused by jurisdictional switch
A major project developer is considering ditching a site specific static methodology for a 21-year old REDD+ project in Africa that sparked an online spat last week over the prickly issue of over-crediting.
INTERNATIONAL
Most global coal use covered by net zero pledges but policy action needed to guarantee transition, IEA says
Almost all global coal consumption is now in countries that have committed to a net zero target, but use of the fuel has been stable at near record highs for a decade and immediate policy action is required to mobilise the financing necessary to kickstart a transition to clean energy alternatives worldwide, the International Energy Agency (IEA) urged on Tuesday.
SHIPPING
China, Europe, and US could decarbonise shipping without IMO -study
China, Europe and the US could decarbonise most of the shipping emissions in the world without measures from the International Maritime Organisation (IMO), according to fresh analysis that points to a bypassing of the UN shipping body in taking climate action for the sector.
ICYM
EXCLUSIVE: Brazil’s most forested states preparing to sell hundreds of millions of carbon credits
At least three of Brazil’s most forested states are preparing to bring what could be hundreds of millions of credits to the global voluntary carbon market, Carbon Pulse has confirmed.
Carbon Pulse hires first product director, doubles Brussels reporting team amid major growth push
FREE READ – Carbon Pulse has hired its first product director, as the world’s leading carbon markets news service focuses on developing its non-editorial content, while it has also doubled its Brussels-based reporting team amid a major growth push.
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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
EMEA
Green Sines – Canadian renewable energy company Neogreen Hydrogen and Portuguese developer of photovoltaic solar parks Frequent Summer announced on Monday plans to invest more than $1 bln in a green hydrogen plant in Portugal, Reuters reports. Green hydrogen, produced using renewable electricity such as wind and solar, is seen as a key power source that can reduce pollution from long-haul heavy transport, steel and chemical industries, and power generation, the companies noted. The plant will be built in the port city of Sines, 150 km south of Lisbon, and will include a 500 MW electrolyzer “for the production of ‘green’ hydrogen and derived fuels,” the companies said in a statement. Separately, the German government is setting up two new funds with a total of €550 mln to support the development of the global hydrogen economy through cooperation, especially with emerging and developing countries.
Connecting countries – Irish and French energy regulators confirmed that the Celtic Interconnector will be completed by 2027, despite a substantial re-evaluation of the project’s costs, Euractiv reports. The French grid operator also confirmed the partial launch of the Savoy-Piedmont electricity interconnection btween France and Italy. The network operators behind the Celtic Interconnector project, an electricity connection between France and Ireland, informed the respective energy regulators on Sep. 30 that the completed project costs will be more than €1.6 bln, an increase of 75% on the initial 2019 estimates of €930 mln. Following their reassessment of the project, French energy regulator CRE and their Irish counterpart CRU confirmed last week that the project will be going ahead, due to be completed in 2027.
Quick fix – Germany has finished construction of its first import terminal for LNG, a crucial milestone in its efforts to end its energy dependency on Russia, the FT reports. The completion of the terminal, at Wilhelmshaven on the North Sea, will ease fears that Europe’s largest economy might face gas rationing this winter. Germany has been striving to build new import infrastructure for gas since Moscow’s full-scale invasion of Ukraine on Feb. 24, which led to a sharp decline in Russian gas supplies to Europe. Earlier this year it chartered five floating storage and regasification units, one of which will be installed at Wilhelmshaven and the other at nearby Brunsbuttel by the end of the year. The first LNG tankers are due to dock at the two sites early next year. German economy minister Robert Habeck pointed out that the Wilhemshaven terminal had taken just 200 days to build – a major achievement for a country where construction projects can drag on for years.
ASIA PACIFIC
Greening up – Shareholders of Australian utility AGL have voted in favour of all four candidates nominated for board positions by tech billionaire Mike Cannon-Brookes, in a landmark vote, RenewEconomy reports. In the vote, Mark Twidell, Kerry Schott, Christine Holman, and John Pollaers had all been elected as independent directors. The four were nominated by Galipea Partnership, an entity associated with Grok Ventures, the investment vehicle of Cannon-Brookes and his family that has amassed an 11.28% share in AGL. It’s a landmark victory for Grok and Cannon-Brookes, and will likely help accelerate the country’s biggest coal generator and polluter exit from fossil fuels.
Work together – A number of Chinese companies have jointly launched a new initiative to explore opportunities around alternative fuel for shipping, Riviera reports. Initiated by China Classification Society (CCS), the project aims to conduct research on different aspects of alternative fuels for the sector, such as regulations, fuel availability, and market mechanism. Participants of the initiative include China Petrochemical Corp, COSCO Shipping, China Merchants Energy Shipping, and ICBC Financial Leasing.
More – South Korea’s major listed companies saw their assets and liabilities related to emission rights increase last year along with trading volume in the local carbon market, data showed on Tuesday, according to Pulse News. Top 30 listed businesses’ allocated rights held a total of 746.4 bln won ($566.4 mln) in assets related to emission rights as of the end of 2021, up by 42.5% from a year earlier, according to data from the Financial Supervisory Service (FSS). The companies’ liabilities related to carbon emissions also grew 17.8% to 835.7 bln won during the same period.
A first – The New Zealand government’s debt management office issued its first ever green bond on Tuesday to fund efforts to meet its net zero carbon target by 2050, Reuters reports. The government said in a statement that it had issued NZ$3 bln ($1.83 bln) of 2034 sovereign green bonds at a yield to maturity of 4.35%. The bonds carry a coupon of 4.25%.
AMERICAS
Brazil forest alliance – Biomass, a partnership between Brazilian mining company Vale and a few large multinationals including Itau Unibanco, Marfrig, Rabobank, Santander, and Suzano was launched at COP27 to restore and protect 4 mln ha of Brazil’s native forests over the next 2o yrs, Canadian Mining Journal reports. Each partner is expected to commit $5 mln to support Biomass activities. The restoration of 2 mln ha of degraded forests with the planting of 2 mln native trees and the preservation of another 2 mln ha of existing trees were among the projects expected to attain carbon credits. The first stage of the project will consist of identifying areas, creating nurseries for native species, engaging with communities, advocating for public land concessions, and working on carbon credits certification.
Gas goners – US state and federal decarbonisation policies, combined with efforts to electrify many end-use appliances, threaten the long-term competitiveness of natural gas local distribution companies, or LDCs, Moody’s Investors Service warned in a research note issued Monday. Emissions reduction targets could shrink LDCs and drive up their costs while electrification “poses an existential threat” to their business model, the ratings agency said. The use of alternative fuels such as hydrogen and renewable natural gas can reduce emissions but come with higher costs, the firm said. To adapt to mounting decarbonization pressures, the gas sector must press for supportive regulatory policies and emphasize the fuel’s ability to help integrate renewable generation and resilience of the natural gas system, according to a report prepared by Guidehouse and published Monday by the American Gas Foundation. (Utility Dive)
A sight for store eyes – After months of pandemic-induced delays, an enormous wave of US energy storage assets is approaching shore. In Q3 2022, developers added more than 1,200 MW of large-scale battery power capacity, tripling from a year ago and pushing total non-hydro storage resources to about 9,200 MW, according to new S&P Global Market Intelligence data and analysis. Most battery facilities completed to date are designed to provide between one and four hours of energy storage. Of the 18 projects completed in the third quarter, eight have power capacities of at least 100 MW and 10 are tied to solar farms.
AND FINALLY…
Savvy shopping – Digital-credit company Bip customers will now be able to see the carbon footprint of their spending on their credit card account when they access the Bip app. Purchases are classified into different categories such as travel and fashion, which the algorithm then uses to calculate the emissions of each purchase, based on the carbon intensity of the particular retailer, or the broader operations of the relevant industry. The service has been made possible through provider NewDay and carbon footprint management company Cogo. “Every month the UK spends nearly £20 bln in credit account transactions. This represents a large chunk of purchasing decisions for which customers previously had no way to understand their carbon impact and make more eco-friendly choices,” said Emma Kisby, EMEA CEO of Cogo.
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