**Carbon Forward Asia is coming – May 2-3, Singapore**
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TOP STORY
POLL: EU ETS emissions seen edging up in 2022 as dirtier power gains trump industrial pain
Emissions from stationary installations covered under the EU ETS probably rose marginally last year, according to a survey of analysts, as a rise in CO2 from dirtier power generation was partially offset by a drop in industrial output.
SHIPPING
Negotiations run aground over 2030 and 2040 targets for global shipping sector
Discussions on introducing 2030 and 2040 greenhouse gas (GHG) emission targets for the global shipping sector at this week’s International Maritime Organisation (IMO)’s closed-door working meeting reached an impasse as the session broke on Friday.
EMEA
Euro Markets: Macro sentiment reversal triggers steep sell-off, wiping out week’s gains
European carbon prices ended Friday little-changed from the prior week as the market plunged the most in more than two months after the weekly German EUA sale, with attention switching back to the resilience of Europe’s banking sector amid growing concerns about the future of Deutsche Bank.
ASIA PACIFIC
South Korea may fail to align with 1.5C target with current power policy -report
South Korea’s latest electricity policy is not ambitious enough for the country to get itself aligned with the Paris Agreement’s 1.5C target, given its planned slow fossil phase-out, a report has found.
CN Markets: CEA volume remains near zero amid bearish sentiment
China’s emissions market saw a second straight week of barely any trades amid lingering negative sentiment, with observers saying the world’s largest carbon market by tonnes of CO2 covered might repeat the late-rush pattern of the previous compliance cycle.
INTERNATIONAL
Think-tank calls for $300 bln per year in grants to phase out coal and scale removals
Low and middle-income countries should receive $300 billion in concessional payments by 2030 to phase out coal power, scale engineered removals, and stop deforestation, with the money potentially stemming from corporates via the voluntary carbon market (VCM), according to an international think-tank.
VOLUNTARY
Start-up tech company offers online ‘start to finish’ project development service
A start-up tech company plans to target small to mid-sized project developers with an online service that streamlines and structures the process needed to attract upfront investment in one platform.
AMERICAS
US Carbon Markets and LCFS Roundup for week ending Mar. 24, 2023
A summary of legislative, regulatory, and policy action on carbon, clean fuel standard, and clean energy markets at the US federal and subnational levels this week, including the failure of several state low-carbon fuel standard (LCFS) bills and a discussion of how California’s programme might be negatively influencing these proposals.
Producers lift CCA, RGA holdings in mid-March, while financials trim positions across the board
Compliance entities picked up California Carbon Allowance (CCA) holdings and RGGI Allowances (RGA) over a two-week stretch in March, while financial players eased net length across the North American carbon markets over the period, data from the US Commodity Futures Trading Commission (CFTC) showed this week as the agency caught up with backlogged Commitments of Traders (COT) reports.
BIODIVERSITY (FREE TO READ)
World governments deliver water action agenda in response to global crisis
The UN Water Conference in New York wrapped up late Friday with billions of dollars pledged by governments and companies and a Water Action Agenda counting over 700 global commitments on water, including nearly 300 related to biodiversity.
Australia next in line to adopt OECM framework to meet biodiversity targets
The Australian government has launched a process to recognise so-called other effective area-based conservation measures (OECMs) in a bid to increase available options to meet its biodiversity targets, a move considered by many nations worldwide as they ponder how to comply with the 30×30 target in the Kunming-Montreal Global Biodiversity Framework.
Biodiversity becoming more crucial to investor policies, survey finds
Biodiversity is becoming an issue of increasing importance to investors, a global survey released this week has found, with nearly half stating that addressing the issue was either at the centre of, or a significant factor in, their respective investment policies.
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Premium job listings
- Technical Director, Climate Action Data Trust – Singapore
- Global Project Partnerships Coordinator, NatureCo – Australia (Remote)
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CONFERENCES
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
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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
Free pass – The US has asked for its steel and aluminium exports to be exempt from the EU’s carbon border adjustment mechanism, Bloomberg reported, citing unnamed sources, complicating work on a broader metals accord that could lead to the allies reimposing billions of dollars in tariffs and retaliatory measures on each other’s goods. It’s unlikely the EU will agree to the American request since the bloc’s legislation doesn’t easily provide for this kind of provision and such a move would likely run afoul of WTO rules, according to people familiar with the situation. President Joe Biden’s administration and the EU are working on a global arrangement on sustainable steel and aluminum, called the GSA, after the two sides agreed to temporarily suspend tariffs that had been imposed by the former US President Donald Trump on national security grounds.
Bank brouhaha – Banks are divided over how to account for carbon emissions linked to their capital markets business, sources told Reuters, with some riled by a proposal that 100% would be attributed to them rather than to investors who buy the financial instruments. An industry-wide methodology was due to be announced in late 2022, but four sources with direct knowledge of the process said this has been stalled by the row over how much of the carbon emissions associated with a deal should be booked by each bank. Reaching an agreement is seen as a crucial step for the financial industry as pressure grows on it to do more to help with the transition to net zero. Without a methodology in place, investors are being hampered in tracking the carbon footprint of individual banks, which is an increasingly important part of their shareholder remit. Most banks are yet to reflect the emissions associated with the deals they do, which are known as “facilitated emissions”, in their targets, making it hard to track their progress towards pledges to reach net-zero emissions by 2050. At present, many banks’ pledges to reduce emissions refer solely to their financed emissions. But between 2016 and 2021, 57% of the financing provided by Europe’s largest 25 banks to the top 50 companies expanding oil and gas production was through capital markets underwriting, according to ShareAction, a responsible investment NGO.
EMEA
Deals on wheels – Germany reached an agreement with the EU on a landmark regulation that requires new cars to be carbon neutral by 2035, Bloomberg reports, resolving a dispute that threatened to undermine the bloc’s ambitious blueprint to reduce greenhouse gas emissions. The government in Berlin said it won key assurances that the EU’s rules would be technology-neutral that would leave space for so-called e-fuels to be used in a zero-emissions framework. “This paves the way for vehicles with combustion engines that only use CO2-neutral fuels to be newly registered after 2035,” German Transport Minister Volker Wissing said Saturday in a statement. The breakthrough came after weeks of talks with the European Commission and pressure from Germany’s EU partners irritated at a last-minute move by the government in Berlin to block the legislation. The deal means that Germany can formally approve an agreement reached in October that requires new cars to be zero-emissions, a key pillar in the EU’s plans to reach climate neutrality by 2050. A vote this month, which was expected to be a simple procedure, was delayed due to objections from Wissing’s pro-business FDP party, the junior member of Chancellor Olaf Scholz’s governing alliance. That vote, which is now expected to take place on Tuesday when energy ministers meet in Brussels, should pass with Germany’s backing as the countries opposing will be unable to reach a sufficient enough minority to block the progress. Italy wanted further assurances, including how cars using biofuels could also be exempted. The deal with Germany doesn’t change the text of the regulation that was agreed between representatives of member states and the European Parliament last year. After ministers sign off on it, the commission will provide more details on the next steps to implement the provision on e-fuels, according to an EU official. Read more on Germany’s last-minute pushback and what a deal with France would look like.
Not zero – The UK government is planning to launch its revamped net zero strategy from the UK’s oil and gas capital, Aberdeen, in a clear signal of its intention to boost the fossil fuel industry while cutting key green measures, the Guardian reports. Next week’s launch was originally called “green day” in Whitehall, but has been rebranded as “energy security day” and will now focus on infrastructure. Environmental campaigners have called the move a travesty. Plans to extend offshore drilling for oil and gas will be cited as necessary and justified by investment in nascent CCS technology, which is as yet untested at scale.
No cargoes – Spain, the biggest European buyer of LNG from Russia, is urging importers not to sign new contracts with Moscow as it seeks to cut ties following the invasion of Ukraine, Bloomberg reports. LNG importers in Spain received a letter from the government recommending that companies don’t sign up to new purchases from Russia. The Spanish government’s request reportedly isn’t binding as there are no sanctions in place, and only refers to signing new contracts. Naturgy Energy Group SA, Repsol SA, TotalEnergies SE, Axpo Holding AG, Pavilion Energy, Enagas SA, Met Energy, Enet Energy, Energias de Portugal SA, Compania Espanola de Petroleos SA, and BP Gas & Power Iberia were sent a letter on March 14 by Deputy Prime Minister Teresa Ribera who heads up Spain’s energy policy.
Strategic nukes – European Commission President Ursula von der Leyen outlined limits to EU backing for nuclear power under the bloc’s Net-Zero Industry Act, which seeks to support home-made production of clean technologies like batteries and solar panels, EurActiv reports. “Nuclear can play a role in our decarbonisation effort – this is important,” von der Leyen said after the first day of an EU summit in Brussels where leaders discussed the EU’s response to US green subsidies. “In our Net-Zero Industry Act, a wide set of net-zero technologies – including cutting-edge nuclear – have access to some simplified rules and incentives,” she said at a press conference on Thursday evening. “But only the net-zero technologies that we deem strategic for the future – like solar panels, batteries and electrolysers, for example – have access to the full advantages and benefits,” she added.
ASIA PACIFIC
Green breakthrough — Hydrogen development company, Fortescue Future Industries, has successfully processed “green iron” ore that it says marks a breakthrough technology and a major step away from using fossil fuels in the steel-making process, RenewEconomy reports. FFI revealed on Friday that the company’s iron ore is being converted to metallic iron using electrolysis, where an electric current is used directly to remove oxygen from the iron oxide ore at a low temperature, removing the need to use coal. The technology has now come out of the lab and graduated to a pilot plant. The focus for FFI’s R&D team is now on increasing scale and decreasing costs of the technology to enable it to compete with traditional steelmaking processes. The company has ambitions to use green hydrogen technology to decarbonise its parent company, Fortescue Metals Group’s mining operations. It is also looking to produce 15 mln tonnes of green hydrogen per year by 2030.
Co-fire this – IHI Corporation announced that it has concluded a memorandum of understanding with PT PLN Nusantara Power (PLN NP), a wholly owned subsidiary of Indonesian state-owned power company PLN, and the Indonesia Fuel Cell and Hydrogen Energy (IFHE) company, in a press release. The three parties will discuss the feasibility of building a local production and consumption-based power system that employs green energy. The announcement is in keeping with efforts of the Asia Zero Emissions Community’s public-private investment forum, or AZEC. Japan’s Ministry of Economy, Trade and Industry set up that body to foster joint efforts in Asia to eliminate CO2 emissions. Other wide-ranging explorations of decarbonisation issues under this initiative will include jointly looking into co-firing or mono-firing ammonia and biomass at PLN NP thermal power plants and enhancing performances at existing thermal power plants. IHI will draw largely on its domestic experience in providing information on these decarbonisation-related technologies, leveraging the expertise of PLN NP and IFHE in pushing ahead with the above studies in Indonesia.
AMERICAS
Unleashing investment – US President Joe Biden’s landmark clean-energy law will cost roughly $1.2 trillion — three times more than the official government forecast — and spur trillions more in private-sector investments, according to Goldman Sachs Group. The Inflation Reduction Act passed last year is intended to encourage investment in renewable-energy sources and efficiency technology. As such, it is crucial to one of the Biden administration’s fundamental priorities: decarbonising the economy to forestall the worst effects of climate change. Goldman’s analysts estimate that the $1.2 trillion in government outlays will unleash another $3 trillion in investment by businesses and individuals to build and expand climate-friendly ventures. (Bloomberg)
How-to CCUS – The White House Council on Environmental Quality (CEQ) announced on Friday members of two new task forces that will provide input to the federal government on responsible development of Carbon Capture, Utilization, and Sequestration (CCUS). One task force will focus on CCUS permitting and development issues on federal lands and the outer continental shelf, while the other will focus on CCUS permitting and development issues on non-federal lands, the press release noted. The task forces, which are required by the Utilizing Significant Emissions with Innovative Technologies (USE IT) Act, will provide recommendations on how to ensure that CCUS projects, including CO2 pipelines, are permitted in an efficient manner, reflect the input and needs of a wide range of stakeholders, and deliver benefits rather than harms to local communities. Task force members will be formally appointed once the task forces are chartered under the Federal Advisory Committee Act.
VOLUNTARY
Pole-sitter – Bloomberg published a feature article profiling carbon project developer and intermediary South Pole, outlining many of the over-crediting and revenue distribution issues surrounding the company’s huge Kariba REDD+ project in Zimbabwe that were raised by outlet Follow the Money in January. The article also suggested that some of South Pole’s biggest customers have either used up their Kariba credits or had no plans to buy more, and questioned the additionality of Agropecuaria Santa Genoveva’s Teakmex ARR project in Mexico (VCS ID:1740). South Pole defended the project’s additionality attributes, and published a response to the article that defended the company’s role in the market and in efforts to tackle climate change.
From beyond – The Science Based Targets initiative (SBTi) has launched a survey through Mar. 31 for corporations and financial institutions on the state of their beyond value chain mitigation engagement, including buying carbon credits and engaging in other activities that avoid or reduce GHG emissions, and those that remove and store GHGs from the atmosphere. The initiative said this is an opportunity to inform SBTi’s upcoming guidance on investment beyond the value chain. Read Carbon Pulse’s reporting on SBTi’s guidance for carbon credit purchases.
LNG GHG certification – MiQ, a global non-profit leader in methane emissions certification, announced the launch of what it describes as the world’s first certification program that enables a complete assessment of all GHG emissions from the LNG supply chain. Until now, importers have not had a transparent or credible way to quantify the level of emissions from purchases, despite rocketing global demand for LNG. MiQ’s new framework tracks 100% of methane, CO2, and nitrous oxide emissions from every segment of the LNG supply chain – including production, gathering and boosting, processing, pipeline, liquefaction, shipping, and regasification. “Our comprehensive GHG framework signifies significant progress toward reducing unnecessary upstream and Scope 1 and 2 LNG emissions to near zero, as we transition to a renewable energy future,” said Georges Tijbosch, CEO of MiQ. The company built the standard on emissions accounting data for production, which already exists on MiQ’s digital registry. The GHG Standard gives importers the power to compare exporters using one common framework. Ultimately, buyers can reduce their Scope 3 emissions while driving pricing signals needed to incentivise investments from producers and exporters. Founded on the mission to solve methane this decade, MiQ’s methane performance standard has been used to independently certify nearly 20% of US natural gas production.
AND FINALLY…
Green gold – UBS Asset Management has launched a new physically backed gold ETF in Europe designed to satisfy climate-conscious investors by holding only gold bars that have been certified carbon-neutral. The UBS FS-Carbon Compensated Gold ETF has been listed on SIX Swiss Exchange in US dollars. UBS has partnered with precious metals refinery MKS PAMP which has developed large cast gold bars that have been certified carbon-neutral by climate consultancy Carbon Trust and meet the requirements to be used in physically backed Swiss-domiciled investment funds. The carbon-neutral label reflects that the CO2 emissions generated across the product’s entire value chain, from mining to refining to vaulting, have been independently measured and committed to being reduced each year. Any outstanding emissions are compensated by financing carbon offset projects with positive environmental impacts. In addition to the carbon-neutral certification, each gold bar is produced in accordance with the London Bullion Market Association’s responsible sourcing guidelines. (ETF Strategy)
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