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TOP STORY

Australia to finance Article 6 demonstration carbon credit projects under IPCOS, action plan says

Australia will fund demonstration Article 6 eligible carbon credit projects in Papua New Guinea as part of the Indo Pacific Carbon Offset Scheme (IPCOS), although the government has said it will only focus on capacity building in the initial phase of the scheme, Carbon Pulse has learned.

ASIA PACIFIC

AU Market: ACCU price flat as industry body calls on govt to provide clarity on market to-do list

The Australian Carbon Credit Unit (ACCU) price has been trading largely sideways for the better part of a month, as an industry body urged the government to provide detail on key policy decisions facing the market.

South Korean carmaker builds blue carbon partnership with government bodies

A major carmaker in South Korea has teamed up with two government bodies to help preserve the country’s marine ecosystems in a bid to achieve greenhouse gas reductions, generate blue carbon credits, and enhance biodiversity.

VOLUNTARY

Carbon credit Investor pumps $15 mln into US wildfire ARR projects

A carbon financier is investing $15 million into post-wildfire restoration projects in the US that are expected to generate carbon credits more valuable than typical afforestation, reforestation and revegetation (ARR) projects.

Dutch startup raises €1.2 mln to fund carbon-negative food production

A Netherlands-based startup has raised €1.2 million in pre-seed funding to help finance its mission to produce carbon-negative food and make factory farming obsolete.

AMERICAS

California approves intentional reversal of over 100,000 compliance offsets

A Virginia-based improved forest management (IFM) offset project must submit over 100,000 compliance instruments under California’s cap-and-trade programme to account for an intentional reversal, according to state data published Wednesday.

EMEA

Euro Markets: EUAs advance steadily amid short-covering as funds seen holding near-record net short

European carbon extended its gains for a fourth day as traders covered short positions and Commitment of Traders data showed that investment funds had built the second-largest net short position since records began, while prompt natural gas extended its losses to the lowest in nearly two years.

EU launches cross-stakeholder partnership to aid energy-intensive industries transition

The European Commission has launched a partnership with 25 stakeholders across energy-intensive industries to help their workforce adapt to the green transition.

BIODIVERSITY (FREE TO READ)

Ecuador secures record debt-for-nature swap for the Galapagos

The government of Ecuador has closed the world’s biggest debt-for-nature swap arrangement to date that establishes a $656-million bond linked to conservation of the biodiversity-rich Galapagos Islands.

European Commission advisors call for exclusion of biodiversity offsets from taxonomy

A body advising the European Commission on rules as to how the bloc classifies green activities has recommended that biodiversity offsets are not included within the scope of the legislation.

S&P Global launches nature and biodiversity risk data set

Analysis firm S&P Global Sustainable1 on Wednesday launched a data set analysing nature and biodiversity risk for more than 17,000 companies, as it released research showing 85% of the world’s biggest companies depend significantly on nature for their operations.

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CONFERENCES

Grow to Zero! – June 26-27, London: Insightful discussions on carbon market evolution? Thought leadership on blended finance for impact? Networking with impact investors and sustainability professionals? Find it all at Gold Standard’s Conference, Grow to Zero! 26-27 June 2023 at Kings Place, London. Tickets and agenda details available here: www.growtozero.co.uk

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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

Copping out – The organisers of this year’s UN climate talks in the UAE have hired a former advisory to ex-UK prime minister Boris Johnson, prompting concern among some environmentalists due to the aide’s pro-fossil stance when he held the position, the FT reports. Lobbyist David Canzini, who advised the Johnson in his last few months in office, is working for COP28 on communications ahead of the climate summit in December in Dubai, according to several people briefed on the matter, the newspaper reports. Canzini opposed a windfall tax on oil and gas companies and pushed Johnson to take a less positive stance on onshore wind farms. Canzini is working on COP28 alongside other staffers seconded from CT Group, a lobbying company set up by Australian political strategist Lynton Crosby, which offers advice to industries including the oil and gas sector.

Green steel – Brazilian miner Vale SA signed an agreement with French sustainable iron ore company GravitHy to seek solutions to produce carbon neutral steel, mining.com reports. The agreement will focus on studies to build a factory to produce briquettes from Vale’s high-grade iron ore through direct reduction, a steel making method. Vale’s briquette is an iron ore agglomerate that reduces emissions in the steelmaking process in the blast furnace route and emits less CO2 when compared to pellets. The product is part of the company’s plans to achieve its commitment to reduce scope 3 net emissions by 15% by 2035. The briquette factory would be located in Fos-sur-Mer, France, next to GravitHy’s first Direct Reduction Iron (DRI, also known as sponge iron) plant. GravitHy’s plant is designed to produce DRI using hydrogen as a reducing fuel, substantially cutting CO2 emissions in the steelmaking chain when compared to the blast furnace route, and is set to be traded globally in the form of hot-briquetted iron (HBI).

AMERICAS

Bipartisan border – US Congressional lawmakers on both sides of the aisle are discussing how to pass carbon border adjustment mechanism (CBAM) legislation that would put tariffs on Chinese manufactured technology, E&E News reported Wednesday. Democrats in the Senate are planning on introducing a bill that would follow up on last year’s bipartisan semiconductor legislation, which funded domestic manufacturing of computer chips, and that bill could include CBAM language. There are currently four separate CBAM proposals in the US Senate, two from Democrats and two from Republicans.

Fusion deal – Tech giant Microsoft has signed a power purchase agreement with nuclear fusion energy startup Helion for at least 50 MW of electricity beginning in 2028, the companies announced Wednesday. Helion plans to locate its fusion plant in Washington state, home to both companies, and sell power directly into the grid via Constellation. Microsoft plans to use the electricity to power its data centres, Chief Sustainability Officer Melanie Nakagawa told Axios in an interview. The agreement is being billed as the world’s first such deal for a fusion firm, and comes as money and interest pours into the much heralded, yet-to-be-realised clean energy source.

Sustainable Sound – Puget Energy, the parent company of Washington state utility Puget Sound Energy, on Wednesday announced a Sustainable Financing Framework to allow any of its subsidiaries to issue green bonds or other financial instruments for investment in new and existing projects. In a press release, the company said sustainable financing proceeds will be allocated to eligible project categories including renewable energy, energy efficiency, clean transportation, and more. The investments are aligned with and driven by Washington’s WCI-modelled cap-and-trade programme and clean fuel standard.

Quebec climate cash – Canadian environment minister Steven Guilbeault on Wednesday announced up to C$187 mln from the Leadership stream of the Low Carbon Economy Fund to support Quebec projects. Up to C$127 mln will support initiatives that will result in GHG reductions by 2030 and align with Canada’s and Quebec’s goals for net zero by 2050, and up to C$60 mln will help low-income households in the province move away from home heating oil to more efficient and affordable options.

EMEA

Correcting mistakes – German energy policy in the Baltic Sea region has been a major failure that will now have to be corrected through a rigorous pivot towards offshore wind power, foreign minister Annalena Baerbock said at the Baltic Offshore Wind Forum in Berlin on Tuesday, Clean Energy Wire reports. Germany’s insistence on the Nord Stream 2 pipeline to import natural gas from Russia despite the often-vocal rejection of the project by its neighbours in the region had been a severe mistake that cost Germany dearly, she added. She added that Germany has paid for every cubic metre of Russian gas by giving up its security “twice and three times over,” after gas trading came to a halt following Russia’s attack on Ukraine. Instead of Nord Stream, the focus should now be to build up offshore wind in the Baltic Sea together with partner countries. The foreign minister added that there is a potential for building as much as 93 GW of offshore wind power production capacity in the Baltic Sea, but cautioned that it will not be easy, requiring massive investments in infrastructure and security, as the attacks on the Nord Stream pipelines in 2022 had shown. Germany was among several European nations that recent signed pledges to massively scale up offshore wind capacity in the North Sea.

Getting away with it – Shell won its fight at the UK’s Supreme Court over a lawsuit into one of the largest oil spills off the coast of Nigeria after Britain’s top judges dismissed arguments that the oil giant could still be held responsible over a decade later, Bloomberg reports. The Bonga oil leak in 2011 – said to be the largest spill in the Niger Delta for at least 20 years – was an environmental “catastrophe” that caused billions of dollars of damage, a group of almost 28,000 Nigerian people has argued. Lawyers for two of the claimants said that the spill of some 40,000 barrels of oil, which happened during a transfer of oil between two vessels, wreaked havoc across communities. The two had attempted to argue that the oil spill could be considered a “continuing nuisance” allowing for statutory time limits to legal action to be extended. But the panel of five judges rejected those arguments Wednesday.

Cold feet – German utility RWE is drawing up plans to pull out of a controversial LNG project on the Baltic Sea island of Ruegen, deterred by political rows including about the location of the project. The firm had been lined up to build the floating terminal and at the end of last month. RWE said talks were still ongoing with the government, but a lack of agreement between local and federal officials who are stalling on key decisions about the facility is causing the company to consider exiting the project, according to people familiar with the matter who asked not to be identified as the matter is private. Germany has embraced LNG as way to fill the energy gap after Russia cut pipeline supplies in the wake of its invasion of Ukraine. Three floating terminals are already operational, with six potentially in place by the end of this year and plans underway for a seventh. There are concerns among some lobby groups that the nation is building too many terminals, wasting money and locking in fossil fuels for longer. (Bloomberg)

Cementing profits – German cement producer Heidelberg Materials recorded sales of €4.9 bln during the first quarter of 2023, up by 13% year-on-year. The company said that energy prices in the quarter eased slightly, but remained “volatile”, and were still well above previous years. The firm has upgraded its outlook for the year to a moderate rise in sales, with earnings of €2.5-2.65 bln, compared to €2.35-2.65 bln in its previous outlook, in signs of robust demand and easing energy costs. (Global Cement)

Not Messer around – Family-owned industrial gas major Messer will start up a new CO2 recovery plant in Austria in early 2024, Gas World reports. The plant will use BASF’s OASE blue technology to capture CO2 from the flue gas of industrial processes. Recovered CO2 will be refined by Messer up to food grade quality in addition to being used to increase supply reliability in Western Austria, South Tyrol, Eastern Switzerland, and Bavaria. When used in the food industry, CO2 is typically obtained as a by-product from ammonia production. By utilising captured CO2, Messer aims to diversify supply to meet its customer demand. BASF’s OASE blue was developed initially as an optimised large-scale carbon capture technology. According to the company, it supplies customers with a customised technology package along with highly stable, low-maintenance innovative solvent solutions for various carbon capture applications.

ASIA PACIFIC

Let it flow – Malaysia is removing its ban on trading renewable energy and stepping up its efforts to move the country to become more green and energy efficient, Malay Mail reports. Economic Affairs Minister Rafizi Ramli said the ban — imposed a year-and-a-half ago — had put a crimp on job opportunities and economic opportunities locally that could have helped local businesses grow. He added that it was time to find ways to reduce Malaysias reliance on fossil fuels and be more energy efficient. Rafizi said the government will need an estimated 637 bln ringgit ($143 bln) until 2050 to ensure Malaysia has sound infrastructure, solid power grids, and a good energy storage system that will all be integrated seamlessly.

Making methanol – Marubeni has entered into an agreement with MFE Shanghai Environmental Engineering and Technology Co. (MFES) to acquire marketing rights in Asia, excluding China, for low-carbon emission methanol, the company announced in a press release. The product will be manufactured by Anyang Shunli Environmental Technology Co., a company in which MFES has invested and for which it also has sales rights. In recent years, various measures to reduce greenhouse gases (GHGs) have been under consideration in a range of industries. One of these measures is the development of CCU (Carbon Capture and Utilisation), which involves the use of CO2 recovered from exhaust gases as raw material for chemicals and fuels, with this product also falling under the category of CCU. Marubeni will contribute to the reduction of GHG emissions by promoting sales of the product while also satisfying customer demand for environmentally-friendly products, the company stated (Marubeni).

Not aligned — HSBC Global Asset Management, alongside the Australasian Centre for Corporate Responsibility, and Amundi Asset Management have submitted a joint shareholder resolution to Japanese utility J-Power, calling on the company to publish a business plan on how it intends to reach net zero emissions by 2050, ACCR said. It called for the plan to include science-based short- and medium-term GHG emissions reduction targets aligned with the Paris Agreement. ACCR said the company’s targets are not yet aligned with the goals of the Paris Agreement. In particular, the J-Power has presented no indicative schedule for the retirement of its coal-fired power assets and has instead presented a plan that involves capital expenditure into speculative technology prolonging the life of these assets, it said. J-Power’s current plan presents a range of material financial risks to shareholders, ACCR said, including the risks arising from anticipated changes in GHG emissions-related public policy.

VOLUNTARY

Aye Ey – Accountancy firm EY has launched the EY OpsChain ESG, developed on the Ethereum blockchain, that will tokenise credits to equate with a company’s product emissions, and provide transparency to consumers, partners and regulators. The EY OpsChain ESG will report on an enterprise’s current CO2 emissions, which will also be independently verified. Companies will be able to demonstrate the authenticity of the carbon credits used to decarbonise. “Detailed traceability allows for tracking of emissions inventory through tokenization including the ability to link carbon output to specific product output,” said Paul Brody, EY Global Blockchain leader. “By using carbon credit tokens, either created or sourced on the market, enterprises can now have visibility into both their actions towards decarbonization.” EY OpsChain ESG will be available on the EY Blockchain SaaS platform.

Risky business – Finnish tech company Solid World has launched a carbon risk assessment tool, called CRISP, that will evaluate a project’s integrity to investors, such as the likelihood of credit yield, the impact and chances of climate events on the project, policy and legal risk, financial risk and the viability of the project developer. CRISP calculates net forward risk scored based on the weighted sum of the risk factors, running them into ratings from AAA, which is prime, to D, which is junk.

AND FINALLY…

Goodbye glacier – Unaccounted-for melting has been occurring on a glacier in Greenland, according to a study from the University of California, Irvine and NASA’s Jet Propulsion Laboratory. A 204-metre hole was discovered by the scientists in the glacier. The ice could be melting faster than the sea level is rising, the study found. The ice sheet is also shifting back and forth across 2-6 km from where it extends out on top of the ocean. (CNN)

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