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TOP STORY

Washington state inaugural cap-and-invest auction sells out near $50

The first auction of Washington state’s WCI-modelled cap-and-trade programme sold out, with the clearing price coming well above secondary market levels and close to the scheme’s lowest reserve tier trigger, according to results published Tuesday.

AMERICAS

PREVIEW: RGGI Q1 auction primed for lower clear as warm winter, speculative disenchantment weigh

Traders have largely coalesced around the March RGGI auction clearing either below or in line with secondary market pricing, as weak demand from compliance entities following a warmer winter and a lack of speculative enthusiasm threatens to overwhelm potentially bullish drivers on the horizon.

Pennsylvania governor, undecided on RGGI membership, earmarks $663 mln of its funds

Pennsylvania’s new governor included RGGI revenues in Tuesday’s release of his first state budget for fiscal year 2023–24, even as he remained non-committal on supporting the state’s participation in the power sector emissions trading programme embroiled in legal logjam.

EMEA

EU member states more than half way through 2023 free EUA allocations

EU member states have handed out more than half of their 2023 quotas of free carbon allowances under the ETS, according to data released by the European Commission.

EU gathers experts to help steer the bloc’s course on carbon removals 

The European Commission convened its first expert group meeting for carbon removals on Tuesday, aiming to steer the EU’s development of methodologies deemed crucial for the bloc to meet its goal of reaching net zero emissions by 2050.

EU carbon border tariffs could slow green hydrogen uptake, warns industry

The inclusion of hydrogen in the EU’s carbon border adjustment mechanism (CBAM) could delay the uptake of green hydrogen and favour usage of blue hydrogen by the bloc’s heavy industry, representatives from various energy intensive sectors said on Tuesday at an event in Brussels.

Euro Markets: EUAs climb 2.9% as bullish sentiment builds, traders eye return to €100

European carbon posted robust early gains before stabilising on Tuesday as bullish sentiment gained further ground among market participants, supported by positive technical factors, while energy markets were little changed as prices have entered fuel-switching territory.

Analytics firm rebrands and outlines bullish outlook for EUAs

European carbon prices will remain strong out to 2030 despite a recent correction, according to analysts at an energy consultancy that announced its rebranding in a statement Tuesday.

Iceland to buy carbon units to meet UN climate obligations

Iceland’s environment ministry has decided to buy carbon units to meet a shortfall to its legally-binding emissions target under the UN Kyoto Protocol, according to local media.

ASIA PACIFIC

New Zealand forecasts NZU supply to significantly tighten

The annual supply of NZUs in New Zealand’s emissions trading scheme is expected to fall significantly in coming years, according to new data by the country’s environment ministry, with the predicted unit demand-supply gap expected to widen considerably.

Australia Market Roundup: Senate inquiry report fails to push needle on Safeguard Mechanism, as ACCU issuance remains modest

A Senate committee on Tuesday released its inquiry report into the Safeguard Mechanism without shifting the debate much as opposition parties published their own dissenting reports, while new Australian Carbon Credit Issuance (ACCU) remained modest.

Japan backs Australian coal to hydrogen export project with over A$2 bln from green fund

The Japanese government has committed A$2.35 billion ($1.6 bln) to develop a controversial hydrogen supply chain project that utilises a process known as brown coal gasification combined with CCS, to produce and liquefy the fuel for shipping from Australia to Japan, it was announced on Tuesday.

Sinopec backs inclusion of CCUS in China carbon offset scheme

China should accelerate the research and application of carbon capture, utilisation, and storage (CCUS) technologies and include such projects in the national offset programme, a top official at oil giant Sinopec has called for.

VOLUNTARY

Blockchain group plans “game changer” voluntary carbon credit marketplace

A blockchain venture is launching a new voluntary carbon market marketplace to list over 20 million verified tokenised carbon credits at the outset, charging no fees to developers listing their projects.

US developer of nature-based offsets raises $3.2 mln for global expansion

A Colorado-based offset project developer on Tuesday announced a $3.2 mln fundraise that it will utilise to expand its portfolio pipeline abroad.

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CONFERENCES

Argus Asia Carbon Conference – Mar. 14-16, Sarawak, Malaysia: Organised by Argus Media in collaboration with the Ministry of Energy and Environmental Sustainability Sarawak (MEESty), and with host sponsor Samling Group, the Asia Carbon Conference will take place on Mar. 14-16 in Kuching, Sarawak, Malaysia. Join us for the first industry leadership conference for carbon offsetting and trading in Asia to get ahead of your competitors in a rapidly growing global market. This is your opportunity to interact, learn, and network, for the answers you need on fundamental questions about carbon offsets: how do they work, and how might they impact Asia? Find out more

North American Carbon World (NACW) 2023 – Mar. 21-23, Anaheim: For 20 years, the NACW conference has been the place for carbon professionals working in North American carbon markets and climate policy to learn, collaborate, and network. Taking place Mar. 21-23 in Anaheim, California, NACW 2023 will dive into new policies and developments that will shape and scale carbon markets and climate solutions with integrity, ambition, and equity. Register now to gain actionable insights for bold climate solutions and participate in premier networking opportunities with an active and engaged audience to strengthen your organization’s strategy for navigating the carbon landscape.

European Climate Summit (ECS 2023) – Mar. 28-30, Lisbon: Registration for the 5th edition of the European Climate Summit organised by IETA and partners is open. The ECS brings together leading private sector experts and policymakers from both the carbon and energy world, to analyse and discuss the current developments and pressing challenges. The summit provides a discussion and networking forum for policymakers, business leaders, and innovators involved in building, scaling, and collaborating on markets for net zero. The event will feature high-level plenaries, cross-cutting deep dives, interactive side events, and quality networking opportunities. Registration here

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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

Transatlantic ties – Canada’s prime minister Justin Trudeau hosted European Commission chief Ursula von der Leyen for a two-day visit. In a joint statement, the leaders committed to accelerate work towards climate resilient, nature-positive, circular, net-zero emissions economies, and to create good jobs for workers on both sides of the Atlantic, recognising the importance of tackling the interlinked climate and biodiversity crises together. Trudeau also welcomed the European Commission’s intention to work towards participating in the Global Carbon Pricing Challenge, an initiative launched by the Prime Minister at the 2021 UN climate talks in Glasgow, which aims to triple the percentage of global emissions covered by carbon pollution pricing to 60% by 2030. The leaders also committed to further deepen their climate, environmental, and energy engagement, working towards the establishment of a Green Alliance between the EU and Canada. They looked forward to the High Level Dialogue on Climate this year and committed to exploring how Canada and the EU can improve collaboration in advancing low-carbon manufacturing, including of steel and aluminum, through bilateral and multilateral forums. Von der Leyen is set to met US President Joe Biden on Friday in Washington for talks on the US IRA climate plan.

Not a cop out on climate – In a new roadmap launched Tuesday by the International Copper Association (ICA), members announced that they have aligned on an ambition to reach net zero in Scope 1 and Scope 2 emissions by 2050, and work toward the same goal for Scope 3 emissions. As copper demand is set to double by 2050, the roadmap, Copper — The Pathway to Net Zero, sets out a clear ambition for ICA’s members — among the largest producers of refined copper in the world — to reduce Scope 1 and 2 emissions by 30% – 40% by 2030 and by 70% – 80% by 2040. Regarding Scope 3 emissions, members will work with value chain partners to reduce emissions 10% by 2030, 30% – 40% by 2040, and 60% – 70% by 2050. These collective ambitions show a clear trajectory to achieving defined emissions reductions of up to 85% by 2050, with the balance to be addressed through advanced technologies and enhanced collaboration with value chain partners.

EMEA

Power price lock-in – The EU wants to expand the use of contracts for difference, a draft electricity market reform proposal seen by Reuters showed, to shield European consumers from big price swings. The draft of the proposal due to be published on March 16, steered clear of the deep redesign of the electricity market that some member states have called for, suggesting instead limited changes to nudge countries towards more predictable, fixed-price power contracts. The draft said EU countries should also make it easier for power buyers to sign PPAs and governments should also make sure consumers have access to fixed-price electricity contracts.

Cold on coal – The UK’s GHG emissions fell by 3.4% in 2022, according to Carbon Brief analysis, ending a post-covid rebound. Emissions from coal and gas fell in 2022, due to strong growth in clean energy, above-average temperatures and record-high fossil fuel prices suppressing demand. The 15% reduction in coal use means UK demand for the fuel is now the lowest it has been for 266 years. Emissions from oil increased, as road traffic returned to pre-covid levels and air traffic doubled from a year earlier. However, this was outweighed by the reductions from coal and gas. UK emissions have now fallen in nine of the past 10 years, even as the economy has grown. The drop in 2022 puts UK emissions 49% below 1990 levels, while the economy has grown 75% over the same period. Carbon Brief’s analysis, based on preliminary government energy data, shows UK emissions fell by 14 MtCO2e in 2022. Emissions will need to fall by a similar amount every year – for the next three decades – to reach net-zero by 2050.

Coal cover – Britain’s power grid operator called on a new back-up coal-fired reserve to generate power for the first time, after the market failed to provide enough electricity during the worst supply crunch this winter and triggered a market warning. Tuesday’s conditions of low wind, high demand and a dearth of imports due to strikes by power-station workers in France left the grid struggling to maintain a safe buffer, also known as an operational margin. Wind generation has dropped to less than half its usual level, as freezing temperatures are forecast for London on Wednesday morning. (Bloomberg)

Fight the competition – Berlin is planning to introduce a special industrial electricity tariff ranging between €0.05 and €0.09/kWh in order to boost the country’s competitiveness and push back against US and Chinese subsidies, EurActiv reports. While the EU supports companies in making capital intensive expenditures – or CAPEX – the US has decided to support OPEX, energy minister Habeck said. Until sufficient quantities of renewable energy is available, the German government is currently considering a cap on industrial electricity prices.

The full package – Germany’s postal service Deutsche Post has called for mandatory labelling of the CO2 footprint of parcels sent by parcel services to inform customers, the country’s news agency dpa reports. Such a regulation is designed to make the CO2 emissions of parcels transparent to people, said Ole Nordhoff, the responsible business unit manager at the firm. The label could be introduced as part of a larger postal law reform planned for the end of the year. Deutsche Post in particular could benefit compared to its rivals, because the company has invested significantly more in electric mobility than for example Hermes, DPD, and GLS and therefore has a comparatively low GHG footprint per parcel, the agency reports. Deutsche Posts has a fleet of around 23,000 electric vans in use, more than its competitors. (Clean Energy Wire)

ASIA PACIFIC

Blue carbon – Star Garments Group, a leading global apparel manufacturer headquartered in Sri Lanka, extended its support to the country’s Blue Carbon stock restoration, local media reports. Via the signing of an MoU with the Wildlife and Nature Protection Society, Star agreed to naturally regenerate mangroves across 3 hectares of land, located at Anawilundawa Ramsar wetland on Mar. 1, in commemoration of ‘World Seagrass Day’. In partnership with the Wildlife and Nature Protection Society, the Department of Wildlife Conservation, and the University of Wayamba, Star’s collaboration was a seamless match as the company is the largest in Sri Lanka to have achieved carbon neutral status and the only apparel manufacturer with a complete group of factories to have done so. The natural mangroves regeneration project at Anawilundawa Ramsar wetland marks Star Garments Group’s first step in its journey towards biodiversity restoration of at least 50% of its physical footprint.

EAF investment – China Steel Corporation (CSC), Taiwan’s largest steelmaker, is planning to invest NTD 40 bln ($1.31 bln) in the construction of a large-scale electric arc furnace (EAF) to replace an existing blast furnace, as part of the company’s effort to realise its carbon goals, Economic Daily News reports. The new facility, with an annual capacity of 1.5 mln tonnes of steel, is expected to become operational in 2030 and help reduce emissions from crude steel production by 80%, CSC said.

AMERICAS

Persistent permitting problems – The Biden administration’s climate law, which provides hundreds of billions of dollars in clean energy incentives to fight global warming, won’t be fully effective without permitting reform, executives told the CERAWeek energy conference on Monday. US President Joe Biden last year approved the Inflation Reduction Act (IRA), which extends tax credits to wind, solar, and other clean energy projects, but a parallel effort to speed up environmental permitting – which can take years to complete – has stalled in Congress. Renewable energy companies and utilities have long complained about the time it takes to secure permits for power generation projects and transmission lines required to move the power to markets. White House Energy Adviser John Podesta told the conference permitting reform was high on the administration’s agenda. Biden officials are using all available tools to accelerate permitting and are also supportive of legislative efforts to streamline regulation, he said. (Reuters)

Losses adding up – US Treasury Secretary Janet Yellen on Tuesday warned that climate change is already taking a significant economic toll in the US and could cause extensive losses to the financial system in the coming years, Reuters reported. Yellen made the remarks during the first meeting with the Climate-related Financial Risk Advisory Committee (CFRAC), an advisory board that was set up last year by the Financial Stability Oversight Council in an effort to bolster US action to minimise climate risk to the economy. “A delayed and disorderly transition to a net zero economy can lead to shocks to the financial system as well,” she said during the meeting. Climate-related disasters have caused economic losses through infrastructure damage, disruptions in critical services, and losses in property values, according to a federal government report released last year. The US experienced an average of nearly eight $1 bln disasters every year over the past four decades. In the past five years, that number has jumped to nearly 18 events annually.

A bigger Bayou Bend – Oil producers Chevron and Talos Energy on Monday said they have tripled the size of a proposed CCS hub for the Gulf Coast, Hydrocarbon Processing reported on the same day. Their joint venture, which includes Carbonvert, plans to collect and bury GHGs from clients in the petrochemical, cement, steel, and other industrial businesses along the Texas coast. The cost of the acquisition was not disclosed. The so-called Bayou Bend hub is one of Chevron’s top global bets for CCS, a potentially multi-trillion-dollar market by 2050. The first injection is expected around 2026. Timing will depend on the regulatory process and client needs, said Robin Fielder, chief sustainability officer for Talos. The group will start to seek long-term customers, including those looking to use CCUS associated with hydrogen production, the executives said. The expanded area could store more than 1 bln tonnes of GHGs.

VOLUNTARY

Masting impact – Climate tech company Mast, the newly-formed parent company of DroneSeed, on Tuesday announced its acquisition of California-based Cal Forest Nurseries, which supplies the majority of the seedlings used for reforestation in the state. In a press release, Mast said the acquisition will allow it to execute more high-quality carbon removal credit projects, with the company last year having sold over 150,000 future removal credits from the Henry Creek reforestation project in western Oregon. Mast said its 2023 reforestation projects will include a site in Montana to expand the elk habitat corridor around Yellowstone National Park.

Striking out carbon – 1PointFive, a CCS company, and the Houston Astros, announced Tuesday that the team has agreed to purchase CO2 removal credits from 1PointFive’s DAC plant under construction in Ector County, Texas. For this agreement with the Astros, CO2 captured by DAC will be sequestered in saline reservoirs not associated with oil and gas production. Over the next three years, the Astros will utilise the removal credits across a number of activities throughout the ballpark as they work towards a carbon neutral footprint. In January, the NFL’s Houston Texans agreed to buy carbon credits from 1PointFive.

Have your forest and harvest it too – Maine forests already absorb about 70% of the state’s annual fossil fuel emissions. Now, a new study shows that Maine’s commercial forest landowners could increase annual carbon storage by at least 20% over the next 60 years while maintaining timber harvest levels, Maine Public reported Tuesday. The findings are timely as the demand for carbon offset projects accelerates. The forest modeling study across 7.6 mln acres of mostly privately-owned commercial forest lands in northern Maine was conducted by researchers from the University of Maine, the New England Forestry Foundation and the US Forest Service. Under current management practices, the forestlands are expected to remove 36 Mt/yr of CO2. But, if climate smart strategies such as increased planting, thinning, and selective harvesting were widely adopted, the study suggests even more carbon could be stored without decreasing harvest levels.

SCIENCE & TECH

Nobody puts carbon in the corner – The 4 Corners Carbon Coalition, a network of local US governments committed to addressing the climate crisis with carbon removal, on Tuesday announced it has awarded $150,000 to develop the world’s first on-site, fully-integrated direct air capture (DAC)-to-concrete manufacturing facility. The project will be developed by ultra-low carbon concrete technology developer CarbonBuilt, modular DAC technology developer Aircapture, and concrete products manufacturer Block-Lite. In a press release, the coalition said the process is expected to reduce the embodied carbon of the resulting concrete blocks by 70% compared to traditional concrete.

Radical battery – The Argonne National Laboratory in Lemont, Illinois claims to have cracked the battery technology for electric vehicles, discovering a way to raise the future driving range of standard EVs to a thousand miles or more, reports the Daily Telegraph. It promises to do so cheaply without exhausting the global supply of critical minerals in the process. The joint project with the Illinois Institute of Technology (IIT) has achieved a radical jump in the energy density of battery cells. The typical lithium-ion battery used in the car industry today stores about 200 watt-hours per kilo (Wh/kg). Their lab experiment has already reached 675 Wh/kg with a lithium-air variant. This is a high enough density to power trucks, trains, and arguably mid-haul aircraft. The team believes it can reach 1,200 Wh/kg.

AND FINALLY…

Mutant seed space race – Hurtling around the Earth at more than 20 times the speed of sound, some of the tiniest life forms aboard the International Space Station are on a mission to feed people on a warming planet. Seeds of sorghum and cress launched into orbit by the International Atomic Energy Agency are tethered to the capsule via a thin metal box. That’s exposing them to more-intense solar radiation in a trial to induce genetic mutations so they can survive hotter temperatures, drier soils, spreading pestilence and rising sea levels. (Bloomberg)

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