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TOP STORIES
German court rules against oil firm’s climate neutrality claim, as provider shifts course
An oil major claiming climate neutrality on certain products derived from carbon credits purchases lacks sufficient credibility to justify the label, a German court has ruled, with the provider of the offsets on Wednesday signalling a long-planned move away from such claims in its advice to clients.
ANALYSIS: Experts warn Big Oil against using high prices, energy security narrative to ignore long-term transition risks
Oil companies shouldn’t lose sight of the long-term implications for their business models of an eventual peak in fossil fuel demand, despite their citing of energy security concerns and record-high profits on the back of high energy prices prompting sentiment to maintain robust oil and gas production levels, analysts have told Carbon Pulse.
EMEA
Euro Markets: EUAs give up some gains but end higher as UKAs fall to biggest discount after weak auction
EU carbon prices resumed their upward trend on Wednesday, briefly hitting a new three-week high as the market edged towards the €100 mark in increasingly thin trading ahead of the Easter break, while UK allowances dropped to their biggest-ever discount against EUAs after the weakest auction result this year.
EU nations agree softer stance on F-gases to tee up talks to finalise bill
EU nations agreed on Wednesday a united line on fluorinated gases (F-gases) and ozone depleting substances (ODS), allowing the Swedish presidency to start negotiations to finalise regulations that aim to phase down substances that cause greenhouse gas emissions and deplete the ozone layer.
European Commission seeks expert advice on EU ETS expansion to buildings, road transport
The European Commission is seeking experts to provide advice on the implementation of emissions trading in the EU’s buildings and road transport sectors.
Vitol’s UK subsidiary to install 349 MW of new ‘flexible’ gas power generation
One of the UK’s largest emitters is building 349 MW of new gas power generation capacity to meet peaks in demand, while also advancing CCS plans for its existing thermal output.
VOLUNTARY
Voluntary carbon market heading into a storm without an overhaul, panel warns
The voluntary carbon market (VCM) is primed for a difficult stretch without more regulation, an overhaul of methodologies, and a process of continuous improvement to create high quality credits, a panel heard Wednesday.
Vitol and Nigerian sovereign fund ink deal to develop carbon projects
Swiss commodity trading firm Vitol and Nigeria’s sovereign wealth fund (NSIA) have completed a joint venture to invest in a range of carbon avoidance and removals projects in the oil-producing African nation, with an initial $50 million pledged, according to a release on Wednesday.
Salesforce releases nature-positive strategy, commits to blue carbon credit purchase
US software giant Salesforce released its Nature Positive Strategy on Wednesday, including details around strengthening its nature-related disclosure metrics as well as a $10-million spend on blue carbon credits.
Web3 startup raises $3.5 mln to remove CO2 through selling collectible NFTs
A San Francisco-based startup focused on carbon removals through collectible non-fungible tokens (NFTs) has raised $3.5 million in funding.
AMERICAS
WCI Q1 surplus expands on offset issuances, as allowance glut dwindles
The WCI compliance instrument surplus bank expanded only slightly in the first quarter as offset issuances outweighed allowance retirements, according to programme data published Wednesday.
Oregon allocates emission permits for second year after winning lawsuit
Oregon’s Department of Environmental Quality (DEQ) proceeded with distributing free compliance instruments to covered entities as part of the state’s market-based emissions reductions scheme, after the agency prevailed in one of the legal challenges facing the programme.
LCFS Market: California prices tick up to 6-week high amid rising financial involvement
California Low Carbon Fuel Standard (LCFS) credit values this week increased towards levels not seen since late February to the bewilderment of some traders, as federal data showed financial players have steadily increased their presence in the futures market in recent months.
ASIA PACIFIC
Australian bank announces transaction with fintech firm to tokenise ACCUs
One of Australia’s “Big Four” banks has tokenised Australian Carbon Credit Units (ACCUs) and issued it as a stablecoin on the blockchain as part of a pilot run with a carbon credit tech company.
Australia Market Roundup: Industrials commit to decarbonisation following Safeguard Mechanism passage, WA EPA releases GHG guide
Companies with industrial operations in Australia have announced new investment in decarbonisation tech following the passage of the strengthened Safeguard Mechanism through parliament, while the Western Australian EPA has published its final GHG guidance for heavy emitters.
Carbon services provider launches low-volume online platform
An Australian carbon credit provider has launched an online platform specifically catering for smaller volume transactions, in a bid to provide organisations with lower carbon footprints access to high quality credits.
INTERNATIONAL
Viable pathway exists for accelerating green steel projects with concerted policy action, report says
A viable investment case for near-zero emission steel projects is within reach in Europe and North America, opening up the possibility to put the steel sector on a Paris-aligned emissions pathway by 2030, according to a report released on Wednesday.
BIODIVERSITY (FREE TO READ)
Brazil, China, Indonesia top biodiversity funding priority list, analysts say
Large middle-income countries like Brazil and China should top the priority list of biodiversity funding, analysts at BloombergNEF said Wednesday as they laid out options and priorities for the world to scale up nature finance to the required $1 trillion per year by 2030.
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CONFERENCES
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
EMEA
CAKE conflagrations – The Centre for Climate and Energy Analyses (CAKE) – part of Poland’s National Centre for Emissions Management (KOBiZE) – has published a report presenting possible configurations of the recently-agreed ETS reform under the ETS’s Fit for 55 package, which adds shipping to the current ETS and sets up a parallel scheme for road transport and buildings later in the decade. The report presents possible configurations of the policy up to 2050, which encompasses emission allowances trading, including various options of extending it to cover new sectors and their impact on the economy, which will be a key part of the debate and decision making process towards the end of this decade.
German handouts – For the 2021 accounting year, the German Emissions Trading Authority (DEHSt) received applications from 351 companies for subsidies for the indirect CO2 costs of emissions trading and eventually gave €806 mln in aid to 341 companies across 676 plants. The EUA price used to calculate the aid was €25.09. The aid handed out for the 2020 accounting year was slightly higher at €832 mln.
AMERICAS
Standing no challenge – The US Court of Appeals for the Fifth Circuit on Wednesday threw out a Republican state-led challenge to the interim social cost of GHG (SC-GHG) metric introduced by President Joe Biden’s administration in Jan. 2021. The court ruled the GOP states, led by Louisiana, had no standing to bring the case forward, as they could not prove they had been harmed by the interim metric, which does not impose any requirements on states. A Louisiana district court in Feb. 2022 issued a preliminary injunction that prevented the Biden administration from using the interim SC-GHG, though the Fifth Circuit just a month later stayed the injunction. The Eighth Circuit court also reached a similar conclusion in a case against the interim SC-GHG brought by Missouri.
20 stays – New York Governor Kathy Hochul (D) will no longer seek to alter how the state accounts for emissions in budget negotiations, Basil Seggos, commissioner at the Department of Environmental Conservation, and Doreen Harris, president and CEO of New York State Energy Research and Development Authority (NYSERDA) said in an interview with Politico. A deal on cap-and-invest remained a priority for the governor in budget talks, the officials said, but other elements such as the emissions accounting would be considered at a later time. New York is one of two jurisdictions to use a 20-year time horizon to account for emissions instead of 100 years.
Pension fund press – New York City pension leaders on Wednesday pressed external fund managers, including private market fund managers, for details on their plans to cut GHG emissions, officials said. Public, and private market managers that have faced less pressure on climate issues to date, run most of the roughly $240 bln in New York City pension fund assets. Boards overseeing the majority of that money have approved new expectations for those managers, New York City Comptroller Brad Lander said. Lander told Reuters in an interview the hope is that the new requirements by one of the largest US pension funds will lead the investment firms themselves to adopt more aggressive steps to reach net zero emissions from portfolio companies.
Coal to clean – US President Joe Biden’s administration is channelling hundreds of millions of dollars from recent legislation into its efforts to turn coal communities into clean energy hubs, the White House said Tuesday. The administration gave an update on its push across agencies to kick-start projects nationwide with funding Congress approved during Biden’s first two years in office. The effort includes $450 million from the Bipartisan Infrastructure Law that the Department of Energy will allocate to an array of new clean energy demonstration projects on former mine lands. (CNBC)
SAF significance – The US Inflation Reduction Act is setting up a fight over the climate footprint of biofuels for aviation, with significant implications for the nation’s emissions trajectory, the transportation sector, and rural communities. In coming weeks, the Treasury Department will unveil a new sustainable aviation fuel (SAF) tax credit called for in the climate law last summer. It will give up to $1.75 to producers for each gallon of sustainable fuel, based on the amount of carbon reductions in the product compared to conventional jet fuel. The push for sustainable aviation fuel unites both producers and environmentalists, who say it will slash emissions. But the two camps disagree on how best to measure the GHG reductions of individual SAF gallons, raising questions about how the tax credit will be implemented and whether it can help achieve Biden’s climate goals. The debate echoes those of other fuels like hydrogen and natural gas, where analysts disagree on what is defined as “clean”. (E&E News)
No relief – The US Third Circuit Court of Appeals ruled that United Refining must participate in the EPA’s Renewable Fuel Standard (RFS) programme as the company did not merit a hardship exemption, Bloomberg Law reported on Wednesday. The RFS programme allows small refiners with average crude oil input no greater than 75,000 barrels per day to be fully or partially exempt from annual renewable fuel obligations (RVOs) if the facilities could demonstrate that compliance caused them to suffer disproportionate economic hardship. Last week, another federal court issued a stay on EPA’s denial of RFS compliance relief to a small refinery Sinclair Oil Corporation, pending court review.
Funding cement CCUS – The Government of Canada announced signing a memorandum of understanding and the start of negotiations toward an agreement with Heidelberg Materials to support the company’s C$1.36 bln ($1.01 bln) project to build a CCUS system and a combined heat and power (CHP) system at its Edmonton cement facility. This CCUS system, a first of its kind in North America, would enable the company to produce carbon-neutral cement reducing GHG emissions by up to 1 Mt annually, the Wednesday press statement noted.
ASIA PACIFIC
Hydrogen boost – Japan plans to set a new target for the country’s hydrogen supply in 2040, to further spur usage of the fuel and achieve its carbon neutral goal by 2050, Argus reports. The proposed hydrogen target for 2040 is 12 mln tonnes per year, sixfold that of the current target (2 mln tonnes per year), according to a draft framework to revise the country’s hydrogen strategy which was revealed at a ministerial meeting. Japan has already set a goal of 3mln tonnes per year in 2030 and 20 mln tonnes per year in 2050. The intermediate 2040 target is aimed at establishing a more stable investment environment and driving more investments in hydrogen-related projects. The revised strategy will also include Japan’s new target for Japanese companies to introduce water electrolysis facilities with a total capacity of around 15 GW globally by 2030, which would account for around 10pc of the international capacity projected for the same year.
Block Barossa – A group of Australian Indigenous people has lodged human rights grievances with a dozen banks urging them to withdraw a $1 bln loan to Santos for its Barossa offshore gas project, Reuters reports. Environmental and Indigenous groups have been campaigning for years against the $3.6 bln project off northern Australia, and a top court order in December asked Santos to consult Indigenous people on the Tiwi Islands about the project’s environmental plan. Six Tiwi Islands Traditional Owners and one Larrakia Traditional Owner filed human rights grievances with 12 Australian and international banks, with the assistance of Equity Generation Lawyers, a law firm active in climate-related cases, the group said in a statement. Santos did not immediately respond to a request for comment. The complainants are calling on the banks to pull out from the $1 billion loan to the Barossa project, and not to participate in a proposed loan for the related Darwin LNG project.
Bad apples — Global tech giant Apple has cancelled its power purchase agreement with the Upper Burdekin wind farm in Queensland, RenewEconomy reports. The 400 MW project is being developed by Windlab, which is majority-owned by iron ore billionaire Andrew Forrest’s private company, Squadron Energy. There are suggestions that Apple pulled the pin on the deal after Windlab’s public environmental impacts assessment showed that a new design would still have “unavoidable significant residual impact” on local populations of endangered, and critically endangered native wildlife, including koalas and red goshawks. Windlab however asserts that the PPA was cancelled due to a milestone miss, with a company spokesperson saying the project’s development has taken longer than originally anticipated. An Apple spokesperson told the Australian Financial Review that the company “will continue to explore renewable energy projects in Australia”. It was Apple’s first renewable energy project to address and offset customer energy use in Australia, as part of a goal to be completely carbon neutral by 2030, a target that includes customer use of its devices.
AND FINALLY…
The gravity of climate change – An Australian senator has attempted to undermine the entire theory of the greenhouse effect with a bizarre viral claim that scientists have been ignoring gravity’s role in heating the planet, The Guardian reports. The tweet from the Queensland senator Gerard Rennick, a member of the conservative Liberal-National party, which is part of the main opposition Coalition, has gone viral this week and has been met with scorn, derision, and plenty of corrections from high-profile climate scientists. Professor Michael Mann, a leading climate scientist at the University of Pennsylvania, for example wrote in response to the senator’s claim that Rennick should be thankful that he couldn’t get impeached for ignorance. In a tweet, made last month and viewed more than 850,000 times, Rennick posted a video saying that scientists ignore the fact that gravity plays a role in heating the earth, and that’s why net zero CO2 emissions won’t stop climate change. The video features Rennick appearing in a session of parliament where he asked a bemused head of a government science agency whether gases in the atmosphere trap convection. Rennick, who once accused the country’s weather bureau of engaging in a conspiracy to alter climate records, said it was categorically false that CO2 trapped heat like a greenhouse, because a greenhouse or blanket traps convection because it a solid object. However, Chris Colose, a climate scientist at Nasa, replied to the senator on Twitter that Rennick’s question “do gases trap convection”, doesn’t even make sense as a statement, and nor does it discount the importance of greenhouse gases. Meanwhile, Andrew King, a climate scientist at the University of Melbourne, said both gravity and convection were included in climate modelling, and to suggest they were ignored was complete nonsense.
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