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TOP STORY
UKA prices surge even as government opts for least ambitious ETS cap cut option in net zero trajectory reforms
The UK government will opt for the least ambitious suggested option for tightening its ETS cap to align with a 2050 net zero emissions trajectory and will further mitigate this by adding unallocated allowances to the market, while committing to include carbon removals following further consultation.
ASIA PACIFIC
Chinese steel, cement speeding up work for national ETS expansion
Leaders in China’s steel and cement sectors have accelerated their research work on emissions accounting and allowance allocation plans in preparation for the expansion of the national emissions trading scheme (ETS), amid rising pressures stemming from the introduction of the EU’s carbon border tax.
Korean investor eyes Mongolian Article 6 projects
A South Korean investor has signed a Memorandum of Understanding (MoU) with a provincial government in Mongolia and other participants to pave the way for projects that can generate carbon credits under Article 6 of the Paris Agreement.
Environment group calls for review of Australia’s Climate Active scheme as it increasingly becomes out of date
An environmental group has urged the Australian government to hold an independent review into its Climate Active certification scheme and consider scrapping it, as it becomes increasingly out of step with international practices.
Japanese firm to launch agriculture carbon credit registry, eyes international expansion
A Japanese agritech company plans to launch the country’s first private-sector carbon registry by the end of the year, ahead of expanding to more methodologies, overseas markets from 2024.
India hands out responsibilities for domestic carbon market
India has published institutional responsibilities for its domestic carbon market in the national gazette, marking a significant step towards the establishment of what has the potential to be one of the world’s biggest emissions trading programmes.
Australia releases guidelines on Safeguard facility decarbonisation funding
Australia has published guidelines on its A$600 million ($400 mln) fund designed to provide funding to facilities covered under the reformed Safeguard Mechanism to help them decarbonise, as the mechanism itself came into effect this week.
Beijing to auction off 1.5 mln permits under local ETS in August
The Beijing municipal government will auction 1.5 million carbon allowances under its pilot emissions trading scheme (ETS) at the beginning of August, with a price floor for the sale to be set later.
INTERNATIONAL
UN leader urges high ambition in setting global shipping GHG targets at decisive IMO meeting
UN Secretary General Antonio Guterres on Monday urged the global shipping sector and world leaders to keep levels of ambition high at a key UN shipping meeting this week by setting a 2050 net zero target, a 2030 target, and introduce a carbon levy.
Going viral: Introducing carbon pricing can increase odds of adoption elsewhere, study finds
Adoption of carbon pricing in one country significantly increases the likelihood of similar policy adoption in other countries, especially neighbouring ones, a study has found.
VOLUNTARY
ACR standard methodology gets face-lift after three years
Voluntary carbon market standards body American Carbon Registry published its revised crediting methodology on Monday, updating a prior version of project-based carbon credit issuance guidelines from December 2020.
VCM Report: Nature credit prices roll higher, and GEO-eligible contract prices boosted by VCMI buyers guide
Standardised nature credits started to tick higher last week as the market waited for the much anticipated roll of the Xpansiv CBL N-GEO contract into new vintage eligibility years, but the voluntary carbon market overall was little changed in a week when the VCMI rolled out its claims code for corporate buying that aims to end allegations of greenwashing.
Guyana fielding interest for remaining REDD+ carbon credits -VP
Guyana is reportedly attracting interest for the sale of the remaining 70% of its REDD+ credits, after a landmark deal with US energy company Hess.
EMEA
Euro Markets: EUAs slide amid light volume as UKA market sparks to life after UK issues reform proposals
EU carbon prices drifted in the afternoon in low-key trading as Q3 got under way but most attention on Monday appeared to focus on the UK ETS, with prices jumping sharply after the British government published proposals to tighten the market from 2024.
Eastern Europe plays key role in continental carbon uptake, but absorption rate is declining, study shows
Eastern Europe, including Western Russia, accounts for around 78% of the continent’s carbon sink, but the rate is decreasing due to changing land use and management and increasing natural disturbances, a new study reveals.
AMERICAS
Analysts lift CCA price forecasts, leave RGGI unchanged
Analysts raised their California Carbon Allowance (CCA) average price forecasts for the second half of the year on expected policy developments attracting speculative interest, while maintaining RGGI Allowance (RGA) price estimates despite annual deficits seen over the next three years.
RGGI Market: RGA prices ease as spread trades dominate
RGGI Allowance prices softened this week amid heavy spread trading and as a major exchange-traded fund drew down RGGI holdings, though some participants noted the market was still holding up well.
BIODIVERSITY (FREE TO READ)
INTERVIEW: The emergent forum helping British firms to integrate biodiversity into business models
A forum established to aid British companies to better understand their impact on nature and biodiversity expects 2023 to be a pivotal year for the organisation, a senior member told Carbon Pulse, as it aims to ramp up both membership with a focus on informing firms in the country about upcoming ‘net gain’ legislation, the opportunities around crediting outcomes, and dealing with global nature disclosure rules.
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Carbon Pulse is hiring!
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- *Director, Africa Carbon Markets Initiative (ACMI), Global Energy Alliance for People and Planet (GEAPP) – Nairobi
- *Sales Trader, Voluntary Carbon Markets, AFS Energy – Amsterdam
- *Senior Manager, Climate Policy and Strategy, International Climate Policy, Verra – Remote (Worldwide)
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- Senior Business Developer, Carbon Offset Certification – Remote
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CONFERENCES
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
VOLUNTARY
Getting in on the EcoAct – Atos Group has announced exclusive negotiations with Schneider Electric for the potential sale of climate consultancy EcoAct. The proposed transaction excludes Atos’ digital Net Zero Transformation practice, which will remain within Atos. The deal would also establish a strategic partnership between Atos and Schneider Electric on decarbonisation, allowing the companies to build products and solutions for customers’ net zero transitions. This move aligns with Atos’ commitment to achieving net zero carbon emissions by 2039, the company said. If the transaction is successful, it would complete Atos’ divestment programme ahead of schedule, with the deal expected to close in H2 2023. However, it remains subject to agreement and signing of definitive documentation, regulatory approvals, and consultation with relevant employee representative bodies.
Challenger’s challenge – Challenger Energy Group (CEG), formerly known as the Bahamas Petroleum Company, is seeking to renew its exploration licences and potentially monetise its assets in the Bahamas through carbon credits, according to its recent annual report. The company, which holds four offshore exploration licences in the region, drilled an unsuccessful exploration well earlier in 2021. CEG’s CEO Eytan Uliel revealed that his company has had preliminary discussions and made a formal proposal to the government, and is awaiting active engagement. Uliel stated that the company has invested considerable effort to understand the carbon credit market, which has been promoted by the PM as a solution to avoid oil drilling. While it remains unclear how CEG’s oil exploration licences and the government’s carbon credit ambitions align, Uliel insists that an agreement with CEG is necessary if the government plans to leverage knowledge of oil existence as an asset for carbon credits, especially after CEG’s $150 mln investment in the country. (Nassau Guardian)
EMEA
Speed the mandate – More than 40 leading figures from across the UK’s energy and investment sectors have urged the government to move quickly to give regulator Ofgem a specific legal duty to support the net zero transition, in light of the magnitude of the task faced by Britain’s energy regulator as it works to help deliver a near fully decarbonised grid, Business Green reports. In a letter to the government last month, 44 senior figures from firms such as Centrica, SSE, Kensa Group, and Royal London Asset Management, welcomed the government’s recent decision to grant Ofgem a mandate for supporting the transition to net zero as part of the Energy Bill, which is currently making its way through the British parliament. The move was confirmed by the government last month, following years of calls from industry, lawmakers, and Ofgem itself for the watchdog to be given a clearer requirement for it to enable and accelerate the net zero transition.
Greener aviation costs – Achieving net zero will come at a net extra cost of over €820 bln ($900 mln) for European aviation, a cost no sector can bear on its own, said Javier Marin, President of ACI Europe, at the airport body’s annual congress in Barcelona, GreenAir News reports. The EU’s Fit for 55 package will increase airfares and reduce demand, possibly by up to 20%, and with intra-European routes being the most impacted, regional airports and the communities would be most at risk of losing out on air connectivity, Marin said. He called for additional policy and financial support to boost production of sustainable aviation fuels in Europe and access to green energy to support the deployment of hydrogen and electric/hybrid-powered aircraft.
Iranian ambition – The CEO of Iran Energy Exchange has announced plans to launch a carbon market, Financial Tribune reports. In an interview with IRNA, Ali Naqavi listed the bourse’s priorities for the current fiscal year, including the introduction of new financial instruments, further development of electricity markets, and the launch of a carbon market. Few details were provided. Naqavi said his bourse was cooperating with the country’s environment ministry to develop the market, which they hope to complete “as soon as possible”. The concept is not new. Iran’s Fuel Conservation Organization (IFCO) in 2014 announced plans to set up a carbon trading market in the country to reduce industrial emissions – something that never transpired.
Return of the chop – Kenya’s government has announced plans to lift a six-year ban on logging in national forests, sparking criticism from environmental campaigners. The Kenya Forest Service (KFS) stated that nearby communities would economically benefit from the harvesting of trees, despite increasing concerns about climate change impacts. President William Ruto affirmed that the government will ensure only mature trees are felled – a maximum 5,000 hectares per year – and more trees are planted in their place. The decision also comes after a tax on imported timber products was imposed, designed to bolster the local industry and job creation. (Xinhua)
Metal scam – In the face of new carbon taxes on exports to the EU, Mozambique’s biggest industrial employer is making big claims about its hydro-powered “green aluminium”. But researchers doubt how green Mozambique’s aluminium really is and whether it will be able to stay green. If it can’t, analysts told Climate Home, the EU’s carbon border tax could have catastrophic ripple effects through one of the world’s poorest economies. The aluminium sector is Mozambique’s biggest industry and the its largest industrial employer, a source of income to nearly 3,000 people and an indirect boost to many more. But as EU rules approach the sector, some companies have rushed to green claims. Yet, there is skepticism on the part of some over the accuracy of those claims.
ASIA PACIFIC
Slowly but surely — Papua New Guinea’s Climate Change Management Act (2021) amendment is now set before the country’s National Executive Council for endorsement, the Post Courier reports. The amendment provides for the regulation of carbon markets in the country. Climate Change Development Authority Acting Managing Director William Lakain said this will also make way for revenue generation through the sale of carbon credits. He said it would establish the National Climate Change Board, which will provide overall direction in ensuring transparency and accountability over the CCDA. Last month, the country’s Environment Minister told Carbon Pulse the regulation would be made publicly available, but this has not occurred.
Not the same – It is impossible to ask China to set the same carbon price as the EU, as the prices in the two markets were set under different development conditions and emission goals, said Xu Huaqing, a climate policy veteran, Global Times reports. China’s national ETS has been mostly hovering around 55 yuan ($7.72) since the start of this year, compared to the average price of roughly 80 euros ($87.12) in the EU’s carbon market. The concept of carbon leakage is not aligned with China’s ideas behind operating a carbon market, and the EU’s proposed carbon tariff is “unscientific, irrational and unfair,” Xu said at a forum on Saturday.
AMERICAS
Matching for Microsoft – Microsoft has signed an agreement with nuclear power producer Constellation Energy, to bring a data center in Boydton Virginia closer to operating on 100% carbon-free energy round the clock, reports DatacenterDynamics. The Boydton facility will receive up to 35% in “environmental attributes” based on Constellation’s nuclear power production, which will complement Microsoft’s recent wind and solar energy purchases to put the data center very close to 100% carbon-free electricity 24/7. Microsoft has previously signed a nuclear carbon credits deal with Ontario Power Generation for its operations in Canada, and recently signed an energy agreement deal with nuclear fusion startup Helion.
AND FINALLY…
Ein prosit – The largest beer tents at Munich’s famous Oktoberfest are to become “climate-neutral” within five years at the latest, reports newswire dpa. The association of Oktoberfest innkeepers said the target might even be reached by 2026. Operators of the 15 large tents will first determine their total CO2 output in order to then reduce it, with offsetting being considered. Reforestation in the region around Munich should create an Oktoberfest forest in the next few years, the association said. This year’s Oktoberfest takes place from Sep. 16 to Oct. 3. Only 3 of the 15 large regular tents are so far considered climate neutral operations, and four participate in compensation projects, the association said. The innkeepers also said that every tent should offer at least one vegan dish, and increase the proportion of vegetarian dishes. Bavarian state premier Markus Soder of the conservative CSU recently decried initiatives to reduce meat consumption by insisting that “a forced veganisation of Germany and Bavaria makes no sense. A life without roast pork may be possible, but it’s pointless”. (Clean Energy Wire)
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