CP Daily: Monday March 20, 2023

Published 02:12 on March 21, 2023  /  Last updated at 02:12 on March 21, 2023  / Carbon Pulse /  Newsletters

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

**Carbon Forward Asia is coming – May 2-3, Singapore**

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ANALYSIS: Do offset registry revenue models offer perverse incentives to over-credit?

Recent allegations of widespread over-crediting in the voluntary carbon market (VCM) have raised questions of whether the dominant revenue model of offset standards bodies financially incentivises those involved to maximise issuance while compromising integrity.


Euro Markets: EUAs end with modest gain after early fall to seven-week low amid macro weakness

EUAs posted a modest gain on Monday after early losses drove the market to its lowest in more than seven weeks, amid weakness in energy and rallying financial markets after Switzerland engineered the takeover of stricken Credit Suisse by UBS, while compliance demand continued to pick up but not sufficiently to outweigh speculative selling.

EU nations advance 2023 EUA allocation to 62% of total, seven states yet to issue any

EU member states have made modest progress in issuing EU emissions allowances for 2023 in the past fortnight, though a quarter of the bloc has still not started handing out permits, according to an update from the European Commission.


New York Senate budget proposal bans trading in cap-and-invest programme, enables RGGI linkage

The New York Senate put forth an annual budget last week that prevents allowance trading in Governor Kathy Hochul’s (D) proposed economy-wide carbon market and fosters linkage to the RGGI programme, though it is unclear if the executive branch and Assembly will agree to the language as end-month negotiations ensue.

RGGI Market: RGAs escape market volatility driven by bank failures

RGGI Allowance (RGA) values were relatively stable compared to the volatile global markets in the face of bank failures on either side of the Atlantic last week, which generated a risk-off tone across asset classes.


Japan faces pushback on fossil fuel promotion at upcoming G7 ministers’ meeting

Fissures have emerged between G7 member states over the approach towards climate policy in the run-up to the group’s meeting of energy, climate, and environment ministers to be held in Sapporo, Japan next month.

South Korea government sued over backsliding allegations on renewables

The government of South Korea has been sued for backtracking on 2030 renewable energy commitments in its latest electricity plan, which has prompted concerns over the progress towards the country’s carbon neutrality goals.

Independent MPs propose amendments to Australia’s Safeguard Mechanism bill

Australian independent MPs have proposed a raft of amendments to the Safeguard Mechanism legislation currently before the lower house before it goes to the Senate, where it is still unclear if the government has the support it needs to pass it.

Start-up sells first kelp reforestation credits, eyes registration under leading carbon standards

An Australian start-up has sold its first batch of Kelp Reforestation Credits to a commercial fishing company and has begun the process of developing a carbon credit methodology for kelp reforestation under two well-established carbon offset standards.


Rich countries must hit net zero by 2040 as UN warns world will imminently breach 1.5C

Developed nations must carry out rapid GHG reductions and build out removals to hit net zero emissions by 2040 for the world to avoid “blasting through” temperature limits in the next decade, according to the authors of a major UN-backed scientific report, who warned that global warming of at least 1.5C above pre-industrial levels is now very likely over the next decade.


Verra bins UN rice farming carbon credit blueprint after review

Verra has permanently inactivated the use of a popular UN rice farming carbon credit methodology, it said on Monday, several weeks after halting activity and conducting a review following the raising of integrity concerns.

VCM Report: CORSIA-eligible prices dip lower amid financial markets turmoil

Prices for CORSIA-eligible offsets slid lower over the past week, although most standardised offsets barely budged amid turmoil in financial markets after the near collapse of Credit Suisse that could still have wider repercussions.

Mercuria unveils $500 million nature carbon and biodiversity venture

Commodity trading house Mercuria unveiled plans on Monday to invest $500 million in a new nature-based business to fund carbon and biodiversity projects.

New algae methodology receives nod of approval from standards body

A carbon credit standard body has approved the first methodology for dealing with harmful algae blooms in freshwater while at the same time sequestering carbon dioxide.


Including high-quality J-REDD+ can help the ICVCM accelerate a just transition, integrity, and scale in the voluntary carbon market

Jurisdictional REDD+ (J-REDD+) programmes can be a critical means for the Integrity Council for the Voluntary Carbon Market (ICVCM) to achieve its objectives of scale, integrity, and a just transition, argue Mark Moroge, Breanna Lujan, and Julia Paltseva of the Environmental Defense Fund.


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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

Carbon Forward Asia – May 2-3, Singapore/Online: Carbon Forward is coming to Asia! Join us in Singapore or watch the conference online, and gain valuable insights into the trends and developments in carbon pricing throughout the Asia Pacific region. We will discuss investment opportunities across compliance and voluntary carbon markets, as well as transport initiatives such as CORSIA and SAF for aviation and shipping sector programmes, the impact of the EU’s carbon border adjustment mechanism (CBAM), CCS crediting, developments under Article 6 of the Paris Agreement, corporate climate goals, and other exciting topics. We are curating a high-level programme for this rapidly-evolving region, with the agenda and speaker line-up to be released soon. Early Bird tickets are now available. Purchase yours now



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


Plane claim – Rising airline traffic is expected to trigger offset demand under the UN body ICAO’s CORSIA programme for some carriers as early as next year when activity is expected to rebound to pre-pandemic levels, airline association IATA told Reuters, without giving further details. Read Carbon Pulse’s reporting on how ICAO expects most flight activity to return to pre-pandemic levels this year and therefore some carriers participating in the CORSIA 2021-23 pilot phase could face some compliance obligations.


Flying high – The UK’s eight biggest airports have plans to fly almost 150 mln more passengers a year, the equivalent of 300,000 extra jumbo jets, in a bet that climate targets will not hold back the industry. A Financial Times analysis of their expansion projects found that combined they would be able to handle 387 mln passengers annually, a more than 60% increase on the 240 mln travellers who used the airports in 2019. The figures highlight how airports are planning for a period of breakneck growth despite significant financial losses during the pandemic. They also demonstrate how the industry believes that transformational growth is still possible in the lead-up to the deadline in 2050 for the UK to reach net zero GHG emissions.


Green corridor – The government of Japan and the California State Transportation Agency have signed a letter of intent (LoI) to reduce pollution at seaports and establish green shipping corridors, Seatrade Maritime reports. The two parties signed the document during a weeklong US trade mission to Japan. The LoI is based on a partnership to improve trade and climate activities between the two economies. It will also focus on the implementation of zero-emission transportation through the $1.2 bln Port and Freight Infrastructure Programme. The Japanese ministry will share expertise as well as better practices to lower port-related pollution with the Governor’s Office of Business and Economic Development (GO-Biz), the California Air Resources Board, and the California Energy Commission. They will also form strategies for offshore wind development, as well as zero-emission fuels and infrastructure.

Fewer imports – Indian Minister of Renewable Energy and Power R. K. Singh informed the Rajya Sabha that the government aims to reduce a total of $12 bln worth of fossil fuel imports by 2030, following the targets set under the National Green Hydrogen mission, MercomIndia reports. The minister said nearly 50 MtCO2 is likely to be mitigated through the production and use of green hydrogen. In January this year, the Union Cabinet approved the National Green Hydrogen Mission with an initial outlay of $2.3 bln. Singh said the government would support the infrastructural development of electrolysers to accelerate green hydrogen production. He said the government would facilitate the demand creation of green hydrogen by encouraging exports and domestic utilisation and added that the government has initiated efforts to launch green hydrogen pilot projects in the steel, mobility, and shipping sectors.

Farmers for climate – Australian independent MP Helen Haines has moved a motion in parliament to support farmers to cut GHG emissions and access carbon markets. The MP has previously called on the government to fund a network of 200 agricultural extension officers across 20 regional centres to support farmers to achieve Carbon Neutral certification, as well as implement new technologies and practices to reduce emissions. Hains said farmers needed to be at the forefront of government planning for action on climate change, and that farmers were already feeling the effects of climate change. The Parliamentary Budget Office has estimated the cost of the programme would be A$33 mln ($22 mln) a year, or $128 mln over four years. Haines added that the benefits would not only include reducing emissions, but also improving soil quality, increasing water retention, and improving biodiversity.


ESG veto – President Joe Biden on Monday afternoon vetoed a resolution against the Department of Labor’s environmental, social, and governance investing rule. The rule makes it easier for retirement plans to consider ESG factors when considering investments. Republicans in Congress — with support from some Democrats — were able to approve a Congressional Review Act (CRA) resolution to undo the new guidelines. The veto is the president’s first since taking office. Because of the resolution’s vote margins in both the House and Senate, critics of the ESG rule won’t be able to overturn the veto, though the House GOP will try anyway. Republicans have seen some success this year invoking the CRA to put vulnerable Democrats on the spot over controversial rulemakings. House Republicans already passed legislation to undo a Clean Water Act rule, with the Senate expected to act soon. (E&E News)

CCS funding wanted – International Petroleum Corp. (IPC), the first foreign oil company to sanction a project in Canada’s oil sands in more than a decade, could add CCS to the plant if more government financial incentives become available, its CEO told Reuters. Geneva-based IPC, part of Sweden’s Lundin Group, sanctioned phase one of the 30,000 bbl/day Blackrod thermal project in northern Alberta last month. The company joins Canada’s biggest oil producers in urging policymakers to boost public funding for the costly technology that is seen as key to cutting emissions from the carbon-intensive oil sands. Industry says CCS projects need more government support to be financially viable, while Ottawa and the oil-rich province of Alberta are at odds over who should provide increased funding. (Reuters)

License to operate – A planned CCS hub in Calcasieu Parish, Louisiana could potentially sequester a total of 300 MtCO2 over the lifespan of the project, according to a report from the Louisiana State University’s Center for Energy Studies. The report, prepared in partnership with Gulf Coast Sequestration (GCS), assessed the planned hub located near an important industrial corridor that includes some of the largest fuel and petrochemical manufacturers in the US. “Under current technologies, this is a realistic pathway for the region to achieve rapid decarbonisation over the next decade,” one of the report authors said. GCS has submitted two applications for Class VI Underground Injection Control permits from the US Environmental Protection Agency (EPA) and is prepared to move forward to construction once permits are received, the press release noted.


Steer says – The US-proposed Energy Transition Accelerator jurisdictional power sector carbon credit initiative met recently to begin setting up a framework to attract corporate buyers to the scheme. The FT reported that Bezos Earth Fund chief executive Andrew Steer said the ETA could dovetail with the Just Energy Transition Partnership (JETP) deals struck between rich countries and a number of poorer nations, including most recently in Vietnam and Indonesia, since the first programme in South Africa. This would represent a shift in its concept, as US officials had originally envisaged the ETA as distinct, if complementary, to the JETPs. Read Carbon Pulse’s reporting and analysis on the ETA.

New listing – ProMEX, a Hong Kong-based fintech startup, has listed its first batch of voluntary carbon credits for trading, allowing users to retire or transfer such credits easily on its app, Mondo Visione reports. The first batch of listed units, certified and registered with Gold Standard, is offered by Climate Finance Asia, an established ESG firm with offices in Hong Kong and Singapore, according to the report.

Room to grow – Just 1% of US farmers have signed contracts to dedicate land to carbon farming, according to the latest Ag Economy Barometer from Purdue University’s Center for Commercial Ag. The number of farmers in discussion with companies around carbon contracts has risen 2% since 2021. Farmer optimism about the future has also risen, though high interest rates and uncertainties around farm profitability remain. Farmer interest in leasing land for carbon sequestration has been “relatively consistent” since Purdue first included questions about it in 2021. In the first quarter of 2021, roughly 7% of respondents said they were in discussions about getting paid to do carbon capture on their farms. That number increased to 9% in Jan. 2023. Few have actually signed a contract, according Purdue — just 1%, as of Jan. 2023. (AFN)


Wet and fret –  Global methane emissions from wetlands have risen faster this century than in even the most pessimistic climate scenarios, according to research published in the journal Nature Climate Change. Wetlands encompass around 6% of the planet’s surface and are the planet’s largest natural source of the potent GHG. As climate change bites, wetlands are releasing methane into the atmosphere more rapidly – a phenomenon known as the “wetland methane feedback”, with 2020-21 marking “exceptional” growth in wetland methane emissions and tropical wetlands “hotspots”. (Carbon Brief)

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