**Due to public holidays in Europe and the US, CP Daily will not be sent out on Monday, May 29**

Presenting CP Daily, Carbon Pulse’s free newsletter. It’s a daily summary of our news plus bite-sized updates from around the world. Subscribe here

TOP STORY

ANALYSIS: EU steel rebound limited to short term as risks dominate outlook

Signs of recovery for EU steel are likely to remain restricted to the short-term, analysts told Carbon Pulse, with macroeconomic headwinds and energy cost risk, as well as long-term decarbonisation policy, seen keeping sectoral demand and therefore emissions limited.

EMEA

EU lawmakers push to force companies to disclose carbon footprint in milestone vote

The European Parliament is set to back measures to force EU companies to disclose their carbon footprint and take steps to reduce it as part of corporate sustainability requirements to be voted on next week.

Euro Markets: EUAs post 8% weekly loss to new four-month low despite late rally

European carbon prices ended the week down 8.4% after a modest decline on Friday, as selling pressure eased ahead of the weekend, before a surge of buying after the settlement window unwound the day’s losses, even as energy prices extended their week-long decline.

Nigeria under pressure to start carbon credit scheme after touting $50 bln of fossil fuel investment

Pressure is mounting on Nigeria to start its carbon credit scheme with the nation’s lawmakers this week calling for the federal government to act immediately following a motion of urgent public concern.

EU member states hand out minimal quantity of free 2023 carbon allowances in May

EU member states barely handed out any free 2023 carbon allowances to heavy industry this month, according to data released late Friday.

VOLUNTARY

Two more firms drop use of offsetting claims amid German court cases -NGO

Two more companies have agreed to drop their climate neutrality claims on certain products they sell this week, opting to settle rather than face rulings by German courts in cases brought by an NGO alleging that the carbon credits backing the claims lack sufficient credibility.

Coastal ecosystems’ CO2-absorbing abilities offset by other GHG emissions, study finds

New research led by Australia’s Southern Cross University reveals that while coastal ecosystems worldwide play a pivotal role in absorbing CO2, they also emit methane and nitrous oxide, offsetting their overall greenhouse gas sequestering effects.

ASIA PACIFIC

CN Markets: CEA prices and trading volume both drop amid bearish sentiment, CCER liquidity stable

Allowance prices in China’s carbon market inched down marginally over the past week with a plunge in trading volume, while the offset market saw relatively sustained liquidity amid renewed market confidence.

Australian Indigenous carbon body lays down rules of engagement with industry

An Indigenous carbon industry network has called for clearer rules for how co-benefits on carbon credits sold in the market are labelled, and that carbon method design must value Indigenous intellectual property rights.

Thailand oil company partners with local bank on carbon credit investment programme

A major Thai oil and gas company has joined forces with a local bank to launch an investment scheme with the goal of using the proceeds to spend on high quality carbon credits and GHG reduction activities.

AMERICAS

First DEBs-tagged California Carbon Offset futures trade at premium to other credits

The first futures contract for California Carbon Offsets (CCOs) with direct environmental benefits to the state (DEBs) and no invalidation risk changed hands on Nodal Exchange Friday morning, according to a press release from product developer IncubEx, coming in at the steepest price point yet for WCI-eligible credits.

US Carbon Markets and LCFS Roundup for week ending May 26, 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 Minnesota budget language to study a clean transportation fuel standard.

Speculators raise RGGI net position to 5-mth high, compliance shores up across North American cap-and-trade markets

Financial players closed out short positions in RGGI Allowances (RGAs) while compliance entities continued to bolster net holdings across North American carbon markets, as WCI prices inched higher following last week’s auction of California Carbon Allowances (CCAs), data from the US Commodity Futures Trading Commission (CFTC) showed Friday.

BIODIVERSITY (FREE TO READ)

Tiger study shows climate benefits from biodiversity conservation

India’s tiger protection programme has brought with it significant carbon benefits in the form of avoided deforestation, and shows that allowing carbon crediting can pay for a substantial part of the costs associated with species conservation projects even when they take place in a protected area, according to a study published this week.

Orsted to join work on biodiversity blueprint for UK offshore wind power sites

Danish renewable energy firm Orsted and UK-based marine consultants Bluedot Associates have teamed up to develop a biodiversity framework to apply to the planned offshore floating wind power leasing round the UK is planning in the Celtic Sea.

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CONFERENCES

Carbon Fast Forward Mediterranean 2023 – June 22, Athens: Following the pandemic and the energy crisis in Europe, the environmental markets in the Mediterranean have gained momentum as a central tool for companies in the region to achieve their emissions reductions targets, through transparent carbon pricing and a robust cap-and-trade mechanism. The increased ambition that the European Commission has announced as part of its Fit for 55 package will bring the shipping sector into the EU ETS market and increase compliance costs for industrial installations and airlines operating in the region. Join us for this one-day, regionally-focussed event geared towards Mediterranean installation operators and shipowners. Register now, since spaces are very limited.

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

Argus Carbon Markets & Regulation Conference – July 5-7, Lisbon: In the wake of new legislative reforms to the EU ETS being confirmed, and as voluntary carbon markets continue to shift and evolve, the Argus Carbon Markets & Regulation Conference returns to Portugal to provide necessary insights for your company to remain competitive and aware of the upcoming opportunities within Europe and globally. This is your opportunity to stay up to date on the latest market dynamics through panel discussions, fire side chats, and presentations with industry peers and policy makers in-person. Join market-makers in defining both the compliance and voluntary carbon market by booking your place today. Carbon Pulse readers can enjoy a 10% discount with the code PULSE10. To find out more and to book your place, click here

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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

It’s confirmed – The UN has accepted Brazil’s bid to host the COP30 climate summit in 205, President Luiz Inacio Lula da Silva said Friday, according to Argus. The event will be held in Para state’s capital Belem, on the edge of the Amazon forest, he said in a video posted on social media. The president had proposed hosting the event during his visit to COP27 last year, when he vowed that combating climate change would have “the highest profile” in his administration. Separately, Lula has summoned his environmental and Indigenous affairs ministers for “emergency talks after a congressional committee passed a bill gutting the ministries’ environmental oversight powers”, Reuters reports. The measure, which requires approval on the lower house floor and the Senate to pass, represents Lula’s first major clash with a newly conservative Congress following significant gains by right-wing lawmakers in last year’s election. Lula is under pressure to generate jobs in a long-lagging economy that has grown more dependent on environmentally threatening agricultural exports. Yet, he has staked his international reputation on slowing deforestation which surged under his predecessor, far-right former president Jair Bolsonaro.

Not good enough – A high-level UN conference on Wednesday raised less than $1 bln of the more than $5 bln organisers were hoping for to help over 30 mln people in the Horn of Africa cope with a major climate crisis and mass displacement after years of conflict, a major disappointment to aid agencies. The UN appealed for $7 bln this year to provide food and other humanitarian assistance for the three Horn of Africa countries – Somalia, Ethiopia and Kenya, and had only received $1.6 bln. After pledges were tallied, the UN humanitarian office said the total funding for 2023 now stands at $2.4 bln. That means only $800 mln in new funding was announced Wednesday – over 60% from the US, which made an additional donation of $524 mln. That brought its total to more than $1.4 bln for the fiscal year ending Sept. 30. (AP)

Do better – Just over 30% of Glencore’s investors rejected the company’s climate progress report at its annual meeting on Friday, demanding more clarity on how the global miner will meet its commitments to cut emissions. Around 29% of shareholders also backed a shareholder resolution seeking more disclosure on progress in scaling back thermal coal production. Glencore mines and trades thermal coal, used to generate electricity, and has said it plans to run down its mines by the mid-2040s, closing at least 12 by 2035. Its strategy to responsibly phase out the fossil fuel signalled a divergence from peers Anglo American and Rio Tinto, which had sold or spun out coal assets, and had been welcomed by shareholders in 2021. But some have expressed concern this year over how much Glencore is disclosing about its thermal coal output plans. Britain’s largest asset manager Legal & General Investment Management and the fund arm of lender HSBC were among investors to file a request for more information to assess the company’s alignment with global climate goals. Influential proxy advisers ISS, Glass Lewis and PIRC had in the run-up to the AGM advised investors to support the motion. ISS and PIRC also advised against the climate progress report. Glencore’s climate progress plan had received support from 76% of voting shareholders at its 2022 AGM. (Reuters)

EMEA

TotalChaos – TotalEnergies shareholders rejected an activist resolution on Friday urging faster cuts to the oil major’s GHG emissions programme after police intervened to stop climate protesters disrupting its annual general meeting. The resolution, filed by climate group Follow This and 17 institutional investors with a total €1.1 trillion under management, obtained 30.44% of votes, up from a 17% vote share result in 2020, the last time a similar resolution was put forward. Outside the venue in central Paris, the smell of tear gas from earlier clashes hung in the air and police used pepper spray as they dragged some protesters away to free a path for shareholders through several hundred climate activists. (France24)

We quit – Three of Europe’s biggest insurers and large Japanese and Australian insurers have quit the Net-Zero Insurance Alliance (NZIA) as growing US political pressure and legal fears plunge the climate initiative into crisis, the FT reports. Axa, the group’s former chair, Allianz, and Scor, as well as Japan’s Sompo Holdings, said this week that they were leaving the group, which is one part of Mark Carney’s umbrella group Glasgow Financial Alliance for Net Zero (GFANZ), created by the former Bank of England governor ahead of the UN climate summit held in Glasgow in 2021. The Australian insurer QBE slso said it had also left the climate club, after joining in Feb. 2022. The departures bring the total number of large insurers which have left the NZIA to at least nine, severely curbing its collective power and posing a question over its future, with its website listing 22 members on Friday. GFANZ and its members have come under attack from Republican politicians in the US, who are targeting collective climate action groups they perceive to be unfairly hitting the oil and gas industry.

They have the (Portu)gal – Portugal has submitted a request to the European Commission to modify its recovery and resilience plan and add a REPowerEU chapter, the EU executive announced on Friday. It includes six reforms and 18 investments, focusing on energy efficiency in buildings, renewables and biogas, sustainable transport, wind turbines, photovoltaic panels, and heat pumps. In addition, Portugal also proposed to include 31 new or scaled up investments and five new reforms to simplify the tax benefit and social benefit systems, incentives for circular economy and further enhancing digital access to public services. The submitted overall modified plan is worth €22.2 bln. The Commission now has up to two months to assess the request before it passes to the Council.

Redispatch resources – German energy companies have called for the introduction of a new incentive mechanism to trigger the construction of new gas power plants, which the country plans to use as a back-up for renewable energy, reports Clean Energy Wire. Transmission grid operator TransnetBW and the power plant operators Steag and GKM proposed a new-build advance in the form of guarantees for future payments for so called redispatch measures to stabilise the grid. This mechanism would ensure incentives to build power plants exactly where they are needed, and investors could include the payments in their financing calculations without a risk discount. The economy ministry is working on a power plant strategy to stimulate new construction, but so far details are unknown.

Lending a hand – UK banking giant Natwest has announced a new lending push as it ramps up efforts to at least halve the climate impact of its financing activity by 2030, BusinessGreen reports. The bank unveiled plans to provide an additional £1 bln in loans to the UK manufacturing sector by the end of 2030 in a bid to accelerate the roll out of clean technologies in support of net zero targets. The funds would be made available to assets, activities, and companies that are aligned with its sustainable criteria, which underpin its efforts to at least halve the climate impact of its financing activity by 2030 and deliver a net zero emission portfolio by 2050 at the latest.

Clip their wings – Austria, France, Ireland, and the Netherlands have called on the EU to toughen laws to curb the impact of private jet travel on the climate, Reuters reported. The countries are home to some of the busiest airports in Europe, including Amsterdam’s Schiphol and Charles de Gaulle airport in Paris. Schiphol said in April it will ban private jets and small business aviation, which the airport said causes 20 times more CO2 emissions than a commercial flight, while France this week banned certain short-haul commercial domestic flights on routes where sufficient train services are available. In a document shared with EU countries ahead of a meeting of their transport ministers next week, the four countries said the “excessive” per capita carbon footprint of private jet travel should spur the EU to act. Private jet flights in Europe increased by 64% in 2022, and emitted more than 5.3 Mt of CO2, according to research by Dutch consultancy CE Delft, commissioned by Greenpeace. EU countries’ transport ministers will discuss the four states’ paper on June 1.

ASIA PACIFIC

Cannon-hooks Sun Cable — Australia billionaire Mike Cannon-Brookes has claimed control of Sun Cable, and its Australia Asia Powerlink solar export project, winning a bidding ware after falling out with former project partner Andrew Forrest, the ABC reports. The pair, who are among Australia’s richest men, have been in a closed door bidding process to wrestle control of the Northern Territory project. Andrew Forrest’s entity Squadron said it made an initial offer for the project, but then withdrew from the final bidding process. Sun Cable’s administrators say the company has now entered into a sale agreement with an entity connected to Mr Cannon-Brookes’s Grok Ventures. Under his control, it is likely the project will still pursue its original goal of exporting solar power from the outback of Australia to the island nation of Singapore. The project will involve some 17-20 GW of solar being generated, firmed up with a 36-42 GWh battery, with the electricity generated being exported through Darwin, and then up to Singapore via a 4,200 kilometre undersea cable. Forrest’s failed bid was aiming to get rid of the cable part of the project, and instead use the solar to produce green hydrogen.

Microsoft makes Contact — New Zealand’s Contact Energy and Microsoft have signed a 10-year renewable attribute purchase agreement that is supporting the development of new renewable energy capacity in the country, Contact announced. The arrangement will see Contact provide Microsoft with all the renewable energy attributes generated by Contact’s new 51.4 MW Te Huka Unit 3 geothermal power station. This contract supported Contact’s investment decision to begin construction of the new renewable electricity generation facility at Te Huka, Contact said. Contact CEO, Mike Fuge, sees long-term commitments to the purchase of renewable energy attributes as a way to bring a new generation of renewables online faster while directly connecting a company’s environmental aspirations with physical solutions.

CQ-H2 — The Australian Renewable Energy Agency has committed A$20 mln to fund Stanwell Corporation’s front-end engineering and development study for a large scale hydrogen project in Gladstone, Queensland, the agency announced. The A$117 mln project will finalise the development stage of the Central Queensland Hydrogen (CQ-H2) project, which will initially involve the installation of up to 640 MW of electrolysers to produce hydrogen for commercial operations commencing in 2028. The hydrogen production facility will produce gaseous renewable hydrogen that will be purchased by offtakers and converted to renewable ammonia and liquefied hydrogen for export. The study will also investigate the development of a hydrogen liquefaction facility based at the Port of Gladstone that will produce 400 tpd of liquefied hydrogen for export by the end of 2030. The project involves a consortium of partners including Stanwell, Iwatani Corporation, Kansai Electric Power, Keppel Infrastructure, and Marubeni Corporation.

Extended — Queensland’s Land Restoration Fund has extended its third investment round until Jun. 16, the Fund announced. A total of A$50 mln is available through Round 3 for high quality carbon farming projects, with up to A$10 mln funding available per project. The LRF also said in response to recent market feedback, the LRF will consider proposals to vary an LRF contracted project where the project proponent wishes to transfer their project to an updated carbon method. This is as long as the proposed variation only applies to an update of the method administered by the Clean Energy Regulator, and does not involve any change to the contracted ACCU volume, contract ACCU price, or contracted co-benefit activities and outcomes.

On the MoUve – Shell Pilipinas Corporation, the Philippines unit of oil giant Royal Dutch Shell, is seeking more integrated carbon and development opportunities in the country to complement its sustainability thrust. The company announced on Thursday that it recently signed a MoU with the country’s Department of Environment and Natural Resources to kick off a joint identification and development of nature-based solutions. The deal aims to document processes and activities that they can use as a reference to develop programmes, policies, and regulations related to nature-based carbon projects, including activities related to the protection and enhancement of natural ecosystems, such as forests, grasslands, wetlands, and coastal zones. Shell has a target of becoming a net zero business by 2050. (Daily Tribune)

AMERICAS

Poorly performing Peru – Forest conservation initiatives in Peru in the past decades have had little to no effect, as deforestation continues to skyrocket in the country, according to a new study by the International Forestry Research Center (CIFOR). Peru has attracted millions of dollars in forest conservation initiatives and has 254 public and private parks and protected areas, yet deforestation has been rising steadily since 2001 by more than 132 ha per year. In 2020, forest loss peaked, reaching 203,200 ha of tropical forest, the equivalent of 379 football fields. CIFOR’s research also included a literature review of 17 studies evaluating the impact of conservation initiatives in the country over the years. REDD+ mechanisms consistently performed poorly, having the least effect both on forest cover and community economic situations. (Mongabay)

Triple appeal – The governors of three US states – Iowa, Missouri, and Nebraska – penned a joint letter on Thursday to the US Environmental Protection Agency (EPA) to increase biofuel quotas for 2023, 2024, and 2025 under the Renewable Fuel Standard (RFS) rules that the agency proposed in December and is due to finalise before June 15. The governors noted that domestic production for biomass-based diesel had topped 3 bln gallons (11.4 bln litres) in 2022, yet the agency had proposed a quota below 3 bln gal by 2025, which put $5 bln in planned investments made in the three states to expand or build new facilities by biodiesel and renewable diesel producers, oilseed processors, and farmers at risk. The governors also pointed out that the US Energy Information Agency (EIA) had estimated that US renewable diesel production would reach 5.9 bln gal by 2025, urging the EPA to raise RFS biomass-based diesel and advanced biofuel volumes without decreasing market space for other renewable fuels.

Bioenergy bankruptcy – North America’s largest organic waste-to-energy digester announced Thursday it was declaring bankruptcy after losing money on operations. The Rialto Bioenergy facility blamed a lack of feedstock caused by the City of Los Angeles’ delay in implementing regulations to divert waste from landfills. The Canadian-owned anaerobic digester in California had the capacity to turn 1,000 tonnes of organic waste per day into 1 MMBtu of carbon negative renewable gas (RNG). (Renewables Now)

FortisBC scorecard – Utility company FortisBC reduced 776,000 tCO2e emissions in 2022, up 34% from 2021’s avoided emissions, through its Clean Growth Pathway strategy launched in 2018, the company announced in a press release on Thursday. The company achieved emissions reductions through four areas: renewable or low-carbon gas, low- and zero emission transportation, energy efficiency, and displacing marine shipping industry emissions with LNG. Over half of the emissions reductions were from a heating fuel switch to gas from heating oil and energy efficiency measures. Increasing supply of renewable natural gas (RNG) from 13 RNG suppliers accounted for 208,000 tCO2e avoided last year, with 20 more suppliers signed up throughout 2023 and 2024. Transportation fuel switching avoided emissions made up 10% of total share of 2022 emissions reductions, while marine shipping fuel use of LNG instead of diesel or fuel oil cut 27% of GHG emissions, the company detailed.

VOLUNTARY

Dynamite – Toronto-based DynaCERT has announced a purchase order for 3,000 units of its HydraGEN technology from Bristol & Bristol Incorporated, an oil and gas logistics company in Georgetown, Guyana. This technology, which decreases fuel consumption and GHG emissions in diesel engines, also allows for tracking and potentially creating future voluntary carbon credits. Bristol & Bristol has paid in full for an initial 93 units with a staggered delivery schedule planned for the remaining units. The deal’s terms were not divulged. DynaCERT’s technology forms part of the growing global hydrogen economy, creating hydrogen and oxygen on-demand to enhance combustion in various diesel engines, thereby lowering carbon emissions and improving fuel efficiency.

SCIENCE & TECH

H2 8Reakthrough – Technology firm 8 Rivers Capital announced a breakthrough in its 8RH2 technology that captures more than 99% of CO2 in the production of hydrogen, that can be converted to ultra-low carbon ammonia used for fertilizers, maritime fuel, and as feedstock replacing coal in existing power infrastructure, the company announced in a press release on Wednesday. Ammonia produced from the 8RH2 technology is a more transportable form of hydrogen that can be easily converted back to hydrogen after reaching the end user. While many carbon capture technologies target a 90-96% capture rate, the 8RH2 oxy-combustion process will eliminate virtually all direct CO2 emissions, the company stated. Furthermore, unlike standard hydrogen production, 8RH2 uses natural gas and pure oxygen, utilising the CO2 produced in the combustion process as a heat transfer medium in a proprietary reformer before sequestering the CO2. 8RH2‘s advanced process thereby eliminates the need for costly amine or cryogenic-based CO2 separation processes that are normally required to capture CO2, as carbon separation is inherent to the process itself, the company detailed.

AND FINALLY…

Free rein to passions – A new Ipsos poll finds less than half of the American public believe climate change is human-driven, the lowest share reported over several years of polling. Twenty-seven percent believe climate change is natural, 7% think the climate isn’t changing, and other respondents say they aren’t sure whether humans are causing climate change. The lingering disconnect between the established science that explains anthropogenic climate change and public opinion can be traced to the fossil fuel industry. “Virtually all of climate science is on one side of this issue because they’re actually looking at the evidence,” Edward Maibach, distinguished professor and director of the Center for Climate Change Communication at George Mason University told the Hill. “The other side of the issue is driven, essentially, by the fossil fuel industry, and their friends in the conservative media, and their friends in conservative politics.” A partisan divide also remains, with 75% of Democrats believing climate change is mostly caused by humans while only 22% of Republicans believing the same. (Climate Nexus)

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