CP Daily: Thursday April 28, 2016

Published 21:16 on April 28, 2016  /  Last updated at 21:26 on April 28, 2016  /  Newsletter  /  No Comments

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

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EU court declares invalid ETS free allocation for 2013-2020

Europe’s highest court has ordered a recalculation of free ETS allocations to 2020, a move expected to raise costs for heavy industry by cutting its share of Phase 3 allowances by as much as 105 million tonnes or 1.6%, while also having implications for the way the units are handed out in the future.

Vattenfall clinches deal with EPH over massive EUA hedging book

Vattenfall has agreed to transfer its large EU carbon allowance portfolio associated with its German lignite operations to new owner EPH, dispelling uncertainty over a hedging book estimated to be equivalent to around 8% of last year’s total ETS emissions.

Washington state readies revised CO2 market plan, mulls limiting use of external credits

The US state of Washington will next month unveil its revised CO2 market plan, with officials considering whether to put limits on the use of out-of-state credits, exclude power generators and set intensity-based targets for heavy industries export to curb carbon leakage.

NZ Market: NZUs break through NZ$14 on review expectations, Huntly news

New Zealand carbon allowances rose to their highest levels since Sep. 28, 2011 in early Thursday trade on prevailing expectations of government rule changes and news that the Huntly coal-fired power station will be extended to 2022.

EU Market: EUAs retreat on power price drop, bearish auction

EU carbon prices retreated by as much as 8.3% on Thursday after hitting a near three-month high in the previous session, pulled lower by falling power prices and a very poor auction turnout.

Free 2015 utility EUA allocations complete following Bulgaria approval

Bulgaria has been given the go-ahead from the European Commission to hand out 8.3 million free EU carbon allowances to its utilities for 2015, completing last year’s allocation approvals under article 10c of the ETS Directive.

Italy completes bulk of 2016 free EUA allocation to industry

Italy handed out nearly 63 million free EUAs to industry for 2016 in the past fortnight, the European Commission said late Thursday, bringing this year’s distribution of carbon allowances near completion.

BITE-SIZED UPDATES FROM AROUND THE WORLD

Ontario’s overhaul – The Ontario government plans to make the majority of the province’s buildings emissions-free and slash the use of cars to just 20% of commuter trips by 2050 as part of a dramatic plan to meet its climate change goals, the Globe & Mail reported, citing a confidential draft of the province’s Climate Change Action Plan obtained by the newspaper.  It is expected to be formally announced next month.  To achieve these aims, the province will establish a “new ultra-low-carbon utility” – an agency with a sweeping mandate to change everything about how Ontarians use energy to reduce emissions drastically.  The strategy, which wants to put “a zero emission or hybrid electric vehicle in every multi-car household driveway within eight years,” is meant to supplement the province’s upcoming carbon market, and envisions making the government carbon-neutral from next year through the purchase of offsets.

Don’t look down – The Korea ETS remains the world’s only carbon market where prices have never gone down. Despite recent indications that the market may be long in 2015, traders keep pushing the price up. KAUs went up 3% on Thursday to 19,000 won ($16.64), although no trades were reported.

Toughen up – New Zealand’s parliamentary commissioner for the environment, Jan Wright, on Thursday released her submission to the second tranche of the government’s ETS review. Joining the growing choir of voices calling for a more ambitious climate policy she said the government should establish a schedule for phasing out free NZU allocation. NZ should also cancel its surplus of Kyoto units and limit access to international offsets in the market after 2020, she said.

And finally… Same same but different – The Australian opposition Labor party’s ETS proposal this week has been met with scorn by Liberal party ministers, who claim it is a deliberate ploy to increase electricity prices but won’t do anything to cut emissions. But economist Danny Price with Frontier Economics on Thursday said Labor’s proposal is almost identical to an ETS he designed for Malcolm Turnbull in 2009, when Turnbull was last Liberal party leader. Back then, Turnbull described the scheme as “cheaper, greener, smarter”. Ironically, Labor at the time dismissed it as “magic pudding”. (Guardian)

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