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New Zealand will gradually phase out the 2-for-1 rule in its emissions trading scheme over the next three years, the government announced Thursday, a move observers say could push market prices up further but failed to address supply-side issues.
Countries will likely agree a global market-based offset mechanism for the aviation sector this autumn, but it will probably be years until airlines have clarity on what types of credits will be eligible under it, a European Commission official involved in the negotiations said.
A number of Chinese provinces are falling behind in preparing for next year’s launch of the national emissions trading scheme, sowing doubts as to whether the world’s biggest-emitting nation will be able to launch the market on time.
UK MEP Ian Duncan is due to publish his report on post-2020 ETS reforms next week after taking more time to consider newly-emerged data that calls into question how many free carbon allowances cement firms should receive.
Non-compliance entities like banks and hedge funds should be barred from participating in Europe’s carbon allowance auctions because they bring unneeded volatility, a trader from Spanish energy firm Repsol said Thursday.
Volume in the voluntary carbon market rose 10% last year, but prices fell amid over-supply to cause the market’s value to fall to its lowest levels in a decade, a report said.
EU carbon prices rose for a third straight day on Thursday, bolstered by no fresh EUA supply coming to market through government auctions over the past two days.
The California Air Resources Board has issued more than 147,000 new offsets for its cap-and-trade programme, an update on its website said.
Germany has extended its contract with EEX, allowing the Leipzig-based energy exchange to continue to host the country’s EU carbon allowance auctions for another two years.
BITE-SIZED UPDATES FROM AROUND THE WORLD
EU hardens opposition to price controls – The European Commission will not support a proposal to introduce a price floor or corridor in the EU ETS and prefers supply controls to strengthen the system, senior official Jos Delbeke told Bloomberg, adding that such price measures ran counter to the ETS’s role as a market instrument and may cause all kinds of unwanted side effects. Carbon Pulse last month reported Delbeke’s political master, Climate Commissioner Arias Canete, signalling his disapproval of the price corridor idea floated by France. Such a corridor requires a change to the ETS law that would need endorsement by the Commission, qualified-majority support from national governments in the Council of the EU and a majority of the European Parliament.
Steady RGGI – Allowance prices in the northeastern US carbon market, which took a big hit in March, are expected to remain steady around the next RGGI auction on June 1, according to several experts from academia, environmental groups and the industry interviewed by Bloomberg BNA. Among the key factors expected to influence the auction are an oversupply of allowances, a program review currently under way by the nine member states, the potential retirement of nuclear power plants in the region and the continued low cost of natural gas.
Emissions in 2050? Fuhgeddaboudit – A dozen New York lawmakers have introduced a bill aimed at codifying Governor Andrew Cuomo’s climate change goals, including a 100% reduction in GHG emissions from 1990 levels by 2050, Utility Dive reports. The bill would require electric utilities in the state to source 27% of their generation capacity from renewables in 2017, 30% by 2020, 40% by 2025, and 50% by 2030. Environmental advocates have interpreted the goal as a de-facto mandate for 100% renewables. Under the bill, the state would have to cut GHG emissions 25% below 1990 levels by 2025, 50% by 2030, and 80% by 2045 on the way to a complete phase-out by 2050.
Diplomats trump tree-huggers – Foreign ministry officials are gradually crowding out their environment ministry counterparts at international climate negotiations, Reuters reports. This shift signals a higher profile for the issue and improved chances for more coordination to fight it as foreign ministries usually wield more clout and have more experience in coordinating issues as varied as politics, pollution, health, finance and diplomacy.
Climate bonds down under – Australia’s Clean Energy Finance Corporation (CEFC), a government lender to clean energy projects and low-carbon technologies, has committed A$90 million ($65m) as a cornerstone investor in Westpac’s first climate bond, it said. The bond, one of the first of its kind in Australia and certified by the Climate Bonds Initiative, aims to finance a clean energy portfolio worth A$1 billion.
China, the eco-civilization? – Almost one quarter of China will be covered in forest by 2020 if the country succeeds in its mission towards building an “eco-civilization”, a report by UNEP found.
And finally… Not you too, Netanyahu – Israel’s attorney general has been asked to look into allegations that PM Benjamin Netanyahu accepted around €1 million in donations from alleged French carbon fraudster Arnaud Mimran, according to the Times of Israel. Mimran, who is currently on trial for evading hundreds of millions of euros in tax, earlier this week said he gave the cash to Netanyahu in 2001, EurActiv reports. Netanyahu has denied the claim.
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