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COP27
Nations set to postpone even more carbon market decisions for a year, draft suggests
Most decisions on a new UN carbon credit mechanism are set to be delayed for a year as time runs out at COP27 talks, according to draft text released on Wednesday that includes a divisive loophole to double claiming provisions that is seen as likely to grind the negotiations to a halt.
Dozens of countries sign on to Japan’s push to boost Article 6 emissions trade
More than 60 countries have joined Japan’s Article 6 Implementation Partnership at COP27 in Sharm-el-Sheikh, as the country seeks to spearhead a global effort to spur international emissions trade.
LEAF Coalition eyes first issuances of jurisdictional REDD credits in H1 2023
The public-private LEAF Coalition expects the first issuances of jurisdictional REDD credits under the ART TREES standard in the first half of next year, a programme coordinator told a COP27 side event on Wednesday, adding that four more Brazilian states are due to sign up aiming to supply units in future.
Singapore seals talks to implement carbon credit agreement with Ghana, signs MoU with Papua New Guinea
Singapore and Ghana have concluded negotiations on an implementation agreement to cooperate on carbon credits in alignment with guidelines set out in Article 6, the Singaporean ministry of trade and industry has announced while the island state is eyeing a separate market collaboration partnership with Papua New Guinea.
Singapore adds third global offset standard to basket of eligible credits for domestic market
Singapore has added a third global carbon offset standard to supply carbon credits that domestic companies can buy to count towards their carbon tax obligations.
EU and Egypt sign deal on renewable hydrogen development
The EU and Egypt signed a memorandum of understanding (MOU) to develop and produce renewable hydrogen and its derivatives, it was announced at a COP27 joint press conference on Wednesday.
Antigua partners with consultancy to develop blue carbon projects
Antigua and Barbuda has partnered with a blue carbon consultancy, aiming to unlock millions of dollars in financing for the climate transition by restoring and protecting the nation’s coastal habitats.
Roundup for Day 10 – Nov. 16
It’s Wednesday – Biodiversity Day – 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
California weighs stronger cap-and-trade programme in final Scoping Plan
California regulator ARB will commence a public process to evaluate the annual allowance caps and other elements of its WCI-linked cap-and-trade programme, as the state’s final 2022 Scoping Plan published Wednesday aims to hit more ambitious GHG reduction targets.
Protracted Pennsylvania RGGI lawsuit could prevent Q1 auction participation
The Pennsylvania Commonwealth Court heard oral arguments on Wednesday challenging the validity of the state’s power sector cap-and-trade regulation, but the lengthy timeline of outstanding decisions on the case and expected appeals could jeopardise its potential to participate in next year’s first RGGI auction, according to experts.
California’s ARB announces workshop to evaluate forest offset protocol
California regulator ARB will hold a workshop this month to gather input on its compliance forest offset protocol, the first step in the agency’s forthcoming cap-and-trade rulemaking process.
EMEA
EU ditches ‘jumbo’ trilogue of ETS-related bills for separate negotiations
EU legislators are hoping to finalise negotiations on three ETS-related bills over three separate days in December, ditching plans to hold a single ‘jumbo’ trilogue over one day, an EU source said on Wednesday.
Euro Markets: Buyers defend EUAs after 4% drop to leave market poised ahead of REPowerEU talks
EUAs dropped by as much as 4.7% as traders appeared to suffer jitters ahead of this evening’s trilogue meeting to negotiate a compromise package on the REPowerEU package, which is expected to involve bringing forward EUA auctions to raise funds, while gas markets weakened amid forecasts that EU storages will be higher than normal at the end of the coming winter.
EU court quashes Brussels’ approval of compensation for early coal plant closure
The EU’s second-highest court on Wednesday annulled a decision of the European Commission to approve compensation for early closure of coal fired power plant in the Netherlands.
ASIA PACIFIC
China likely to include petrochemicals in national ETS in 2024 -industry group
China is likely to bring in the petrochemical sector into its national emissions trading scheme (ETS) in 2024, a move that would add around 2,300 companies to the world’s biggest compliance market, according to a top official at the national industry association.
Food & drink giant teams up with developers to launch Australian forest carbon project
A global food and drink conglomerate has partnered with project developers to plant a biodiverse mix of 10 million trees in Australia by 2025.
VOLUNTARY
Carbon credit demand should be based on ability to pay, not amount to offset -report
Companies should consider purchasing carbon removal credits, or investing in climate projects, commensurate with their ability to pay, not their emissions levels, according to a report published on Wednesday, that found that emissions intensive sectors are amongst the least likely buyers under this approach.
UAE takes stake in AirCarbon Exchange to bolster VCM ambitions
The United Arab Emirates (UAE) stepped up plans Wednesday to become a hub for voluntary carbon market (VCM) trading, after the country’s sovereign investment company, Mubadala, took a strategic stake in the Singapore-based marketplace AirCarbon Exchange (ACX).
German-based carbon project developer invests in another
A German-headquartered project development firm has acquired an ownership stake in another, they announced Tuesday.
Verra to start piloting digital MRV platform for nature-based projects
Verra, the largest certifier body in the voluntary carbon market, will pilot a digital monitoring, reporting and verification (MRV) platform that promises to slash the time and cost of traditional carbon accounting methods, it announced at COP27 on Wednesday.
INTERNATIONAL
G20 commitment to climate goals amid geopolitical uncertainty can set example for COP27, green groups say
G20 leaders agreed to pursue efforts to limit the global average temperature to 1.5C at this year’s summit in Bali, with the world’s largest economies also agreeing to address the issue of loss and damage from climate change and reaffirming broadly-termed commitments to phase down unabated coal use and phase out fossil fuel subsidies, in moves that were generally welcomed by climate groups on Wednesday.
Countries not doing enough to address trade-embodied GHGs –report
Roughly 25% of global GHG output is occurring through international trade, and nations must consider carbon border adjustment mechanisms (CBAMs) and other measures in order to adequately mitigate these emissions, according to a report published Tuesday.
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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
Renewables rankings – The latest Renewable Energy Country Attractiveness Index (RECAI 60), published by consultancy EY, shows that energy transition and renewables deployment continue to be of paramount concern to global governments in the face of market volatility and an emphasis on decentralised grids. The US retains the top spot following the passage of the Inflation Reduction Act (IRA), which allocated US$369 bln in tax credits and investment for domestic renewables. China stayed in second place, having deployed a record 156 GW of wind and solar capacity so far this year and continuing to lead the global renewables manufacturing market. The top four solar PV manufacturers recorded 114 GW of module shipments in Q1-3 of 2022, despite increased demand domestically in China. Third and fourth places – Germany and the UK – swapped since last year after the UK lost its position as the world leader in offshore wind deployment capacity to China. However, the country continues to boast the ‘largest’ pipeline for offshore wind. (PV Tech)
EMEA
Energy spotlight – The world’s energy sector needs to be reformed to prevent countries from using energy as a weapon, Italian Prime Minister Giorgia Meloni said at the G20 summit in Bali. Meloni criticised “speculators” for having too much influence before calling for reform of the world energy market, Euractiv reports. Supplier countries must not be allowed to take advantage of consumer countries, and, in the meantime, Italy is working on a plan to be the energy hub of Europe, she added. According to the electoral programme of the coalition parties, Meloni’s government plans to make southern Italy an energy centre for the entire continent, exploiting its strategic position in the centre of the Mediterranean.
Feeling the heat – German industry can achieve gas savings worth around 90 TWh by 2030 if it electrifies process heat up to 500C, a study by Agora Industry finds. This corresponds to three-quarters of German industry’s share of fossil gas savings under the European REPowerEU plan to reduce dependence on Russian fossil fuels. At the same time, the use of heat pumps and electric boilers avoids 12.5 Mt, which equals to around one-fifth of the target for the industrial sector by 2030 under the German Climate Change Act.
AMERICAS
Pension promise – The head of Canada’s Pension Plan Investment Board (CPPIB) said he is willing sell assets in companies that aren’t committed to net zero targets. While the CPPIB as a whole does not believe divestment is the right path forward, it will do so if other efforts fail, CEO John Graham said on Wednesday’s Bloomberg New Economy panel in Singapore. The CPPIB manages $400 bln (C$533 bln) and only last year increased its stake in Canadian oil sands firms. On the other hand, Dilhan Pillay, the CEO of Singapore’s state-owned investment firm Temasek, said on the same panel that he preferred to pull companies along towards ESG goals, rather than divest. (Bloomberg)
Hydrogen hysteria – The developer of a $4.5 bln hydrogen project in Louisiana is in a legal battle with local lawmakers in a case that analysts say could preview conflicts around the country, E&E News reports. Air Products and Chemicals Inc., the developer, announced a year ago that it would build its sprawling Louisiana Clean Energy Complex across multiple parishes in the Baton Rouge area. This October, the council of rural Livingston Parish threw Air Products’ plans in doubt by approving a one-year moratorium on well-drilling and seismic testing on its territory. On Oct. 18, Air Products sued the parish in US District Court, arguing that the moratorium was preempted by state and federal law and demanding a permanent injunction against its enforcement.
Not so green fashion? – Fashion giant H&M is facing a class action lawsuit over allegations that its Conscious Choice collection amounts to greenwashing, reports Charged Retail, a news service. A claim filed in a federal court in Missouri in the US is suing the retailer for “misleadingly, illegally, and deceptively” seeking to capitalise on consumer ‘green’ trends, where H&M customers are led to believe that Conscious Choice products are an environmentally responsible purchase. The plaintiffs are claiming that consumers have been “hoodwinked into paying a premium for green products which weren’t green at all. “Basing sustainability strategies on the idea that consumers can continue to consume disposable plastic goods (because they can be recycled into more products) is highly problematic,” noted the filing. “This method of ‘green’ marketing does not address the fundamental issue of perpetuating disposable solutions and overconsumption of natural resources.”
ASIA PACIFIC
Transition division – Indonesian state-owned utility PLN has created an energy transition and sustainability division to oversee the development of strategic policies as the country pushes to lower its GHG emissions and switch to cleaner energy resources, ArgusMedia reports. Indonesia’s power sector currently accounts for over 50% of the country’s GHG emissions, largely because of the country’s reliance on coal-fired power for its electricity needs. PLN, the country’s sole transmission company and a major power generator, said that a fully fleshed out strategic framework for energy transition is key for a smooth transition process. Indonesia is targeting net zero emissions by 2060. The new division will be directly supervised by PLN’s board of directors, the company said. The new division will be responsible for tracking the implementation of energy transition initiatives, in addition to the development of corporate strategies. This is expected to help the company manage energy transition risks and integrate them into PLN’s overall corporate risk management strategy, the company said.
VOLUNTARY
Soil carbon sales – Two US Midsouth farmers working with AgriCapture’s Soil Enrichment Project have received carbon credits for regenerative agricultural practices under the Climate Action Reserve’s Soil Enrichment Protocol. The recently-expanded Soil Enrichment Project becomes the second-ever to achieve carbon credit issuance through CAR’s protocol in less than a year. AgriCapture has arranged to sell the credits to their buyer network while exploring offtake agreements for the full project credit issuance, expected in June 2023. AgriCapture said it has received strong interest for credit purchases and offtake agreements at $30 per credit, $10 lower than competitor Indigo Ag arranged for its own soil carbon offsets from the CAR protocol. (Delta FarmPress)
Startup shuts – Planetly, a carbon-management software company, is shutting down and laying off all 200 employees roughly one year after it was purchased by OneTrust, according to Axios. OneTrust, an Atlanta-based enterprise compliance-software company, made the decision to wind down Planetly in favour of merging its carbon accounting and ESG software products into OneTrust’s primary Trust Intelligence product, Planetly co-founder Anna Alex said in a LinkedIn post. OneTrust bought Berlin-based Planetly in December 2021 for an undisclosed amount. Prior to the acquisition, Planetly provided carbon accounting for roughly 170 companies, including BMW, HelloFresh, and the Economist Group.
SCIENCE & TECH
Virtual SAF flight – The first net zero flight powered entirely by Sustainable Aviation Fuel (SAF) Book and Claim as well as direct emissions reductions has landed in Abu Dhabi after taking off from Dulles airport in the US. Etihad Airways did not use any SAF in the flight, but displaced about 26,000 gal (98,000 L) of petroleum-based jet fuel through the use of net zero equivalent gallons at World Energy’s SAF at Low Angeles International Airport. Alongside using contrail-reducing technology, the net zero flight reduced CO2 emissions by 250 metric tonnes. With SAF in short supply globally, shifting barrels around the world to various airports adds to the carbon footprint. Using Book and Claim instead, net zero claims can be made from any airport. Under current rules, SAF can be blended with conventional jet fuel only up to 50%, meaning the remaining 50% as well as any residual emissions would need to be addressed through a Book and Claim system.
AND FINALLY…
Skin deep – A Berlin-based startup is to renovate apartment buildings in the German city of Bochum, giving them a tailored wooden “second skin” to make them more energy efficient. The project by Ecoworks reflects growing demand for climate-friendly and energy saving renovations in response to Germany’s energy crisis that has caused a surge in heating costs, Reuters reported. Before the crisis, landlords saw renovations to make residential buildings more energy efficient as a nice to have, rather than essential in a sector that missed its CO2 targets in Germany last year. Now that is changing because of the rising energy prices and a new law that splits a CO2 levy between tenants and landlords depending on buildings’ efficiency.
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