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TOP STORY

UN carbon crediting body targets end of August for draft removals guidance

The UN body with a mandate to shape carbon crediting under Article 6 of the Paris Agreement has signalled that draft recommendations on removals are to be prepared by the end of August as it scrambles to ready guidance before the UN’s main COP28 climate summit at the end of the year.

INTERNATIONAL

COP28 boss urges use of every tool available to decarbonise hard-to-abate industries

Governments should use all means necessary for decarbonisation, said the president of the upcoming COP28 UN climate summit, Sultan al-Jaber said on Thursday while unveiling his long-awaited plan for the meeting.

ASIA PACIFIC

NZ government admits fault on current ETS price controls, agrees in court to remake them

The New Zealand government has agreed to reconsider the current price settings and controls of its ETS, after it admitted in the High Court that it made a mistake leaving them largely unchanged at the end of last year.

Green growth could secure $400 billion a year for Indonesia, including as a potential “frontrunner” in nature carbon projects -report

Indonesia could earn as much as $400 billion annually by 2030 in industry revenue and carbon credit sales if it optimises its massive green growth potential, according to a report released Thursday.

SK Market: First monthly auction for KAU-23 fails to sell out with clearing price reaching new low

South Korea’s first monthly CO2 auction for the current compliance cycle sold less than 40% of the permits on offer, with the clearing price dropping to a new low amid continued bearish market sentiment due to a lack of policy direction.

South Korea secures bilateral carbon credit deal with Laos

South Korea this week signed a number of bilateral deals with Laos on the development of large-scale solar and landfill projects, as Seoul is seeking to leverage the Article 6 mechanism of the Paris Agreement.

Australia should drop bill to allow international CO2 transport and storage, think-tank says

New analysis has warned against Australia adopting legislation to allow the transboundary transport and underground storage of CO2, claiming it will encourage more investment in CCS, which the analysts argue is a failed technology that must be abandoned.

AMERICAS

WCI Markets: CCAs rip higher after unexpected ARB workshop announcement, WCAs relatively silent

A flurry of activity after the close of the secondary market on Wednesday and into Thursday trade, in light of the ARB announcing the next cap-and-trade public workshop date, lifted California Carbon Allowance (CCA) prices to year-to-date highs, while Washington Carbon Allowances (WCAs) rose slightly in light transaction activity through the week.

Green groups, utilities advocate for Emissions Containment Reserve in California cap-and-trade reforms

California regulator ARB during the forthcoming cap-and-trade rulemaking should implement an Emissions Containment Reserve (ECR) to help address allowance oversupply in a predictable manner, a collection of environmental organisations, business groups, and utilities said in public comments.

Washington state lawmaker regrets 10% compliance purchase limit in carbon market auctions, hopes to change rule

A Washington lawmaker on Thursday said New York should not emulate the Evergreen State’s 10% allowance purchase limit for compliance entities at cap-and-trade auctions, noting he hopes to revisit the rule in the next legislative session.

Virginia regulator approves Dominion RGGI rider reinstatement

A Virginia regulatory agency granted the reinstatement of utility Dominion Energy’s request to recoup the costs of tens of millions of RGGI allowances on Wednesday via an extra charge on customers’ bills before the state’s planned exit from the power sector carbon market this year.

Brazil ETS legislation will pass Congress before COP30, govt official says

Brazil’s national cap-and-trade legislation will pass Congress by the time the country hosts the COP30 UN climate summit in 2025, a government official said Wednesday.

ExxonMobil pays $4.9 bln for CO2 pipeline owner

Oil major ExxonMobil announced on Thursday it has purchased a US-headquartered carbon capture, utilisation, and storage (CCUS) solutions company with a vast network of CO2 pipelines across the South.

Canadian carbon credit investor seeks Nasdaq listing via merger

A Vancouver-headquartered environmental asset investor on Thursday announced it is aiming to combine with another company in order to pursue a listing on the US-based Nasdaq Stock Exchange.

More than 3/4 of US Gulf of Mexico oil and gas production displays lower-than-average GHG intensity for basin -analysts

More than three-quarters of all oil and gas production in the US Gulf of Mexico features lower greenhouse gas intensity than the average for the basin, according to a new analysis.

VOLUNTARY

Verra publishes carbon credit methodology for food loss and waste

Carbon credit certifier Verra released a new methodology on Thursday to quantify emissions reductions from activities that avoid food loss and waste (FLW) by keeping food in the human supply chain.

Direct air capture costs of $100/tonne to remain elusive without further support -paper

Strategic deployment of direct air capture and storage (DACS) technology can help bring costs down from current levels, though they are unlikely to drop below $100/tonne of CO2 without strong policy support like integrating removals into carbon markets, according to a journal article published Thursday.

CTX partners with Zimbabwe to build pan-African carbon trading registry

Carbon Trade Exchange (CTX) is partnering with Zimbabwe to build a pan-African emissions trading registry to support the continent’s carbon market aspirations.

UAE developer, exchange set eyes on rolling out regional carbon markets in Middle East and North Africa

A Dubai-based carbon project developer and a Singapore-headquartered exchange have partnered with the ambition to develop Paris-aligned Article 6 carbon markets across the Middle East and North Africa.

Making water from carbon: Big investors pledge over $80 mln towards California firm’s hybrid DAC technology

A California-based startup that produces water from removed CO2 has signed strategic partnerships with ConocoPhillips, JetBlue Ventures, and Shell Ventures, securing more than $80 million in multi-year investments towards developing its innovative technology.

EMEA

EU awards €3.6 bln from ETS-financed Innovation Fund, increases pot for the next call

The European Commission on Thursday announced the results of the third call for large-scale projects under the bloc’s EU ETS-financed Innovation Fund, with €3.6 billion being disbursed to 41 clean tech activities.

Europe’s shipping emissions rise 3% to hit three-year high -report

European shipping emissions rose 3% year-on-year in 2022 though remained below pre-pandemic levels, according to analysis published on Thursday that shows LNG-carriers and cruise ships to be the main drivers of the increase for the sector due to face ETS obligations from next year.

Euro Markets: EUAs give up midday gains as energy prices rise

European carbon prices resumed their week-long rally on Thursday morning as traders began to factor in the annual reduction in auction supply due next month and continued to shrug off bearish fundamentals highlighted in recent analyst reports, before giving up almost all their gains in the afternoon even as energy markets made a modest advance.

AVIATION

Asiana Airlines partners with local NGO to provide carbon offsetting programme for passengers

South Korea’s second-largest airline has partnered with a domestic NGO to provide a voluntary carbon trading platform for its passengers, a move that it expects to help reduce emissions in the aviation sector.

BIODIVERSITY (FREE TO READ)

FEATURE: NZ biodiversity market needs careful consideration, groups say, but have little faith in the govt to deliver it

Stakeholders are reacting cautiously to the government’s proposal to establish a national biodiversity market in New Zealand, saying that it is a good idea in principle, but the government’s handling of the existing carbon emissions trading scheme gives some little faith in Wellington to administer such a programme.

Biodiversity Pulse Weekly: Thursday July 13, 2023

A weekly summary of our biodiversity news plus bite-sized updates from around the world. All articles in this edition are free to read (no subscription required).

COMMENT

Viridios AI analysis reveals voluntary carbon price drivers

It’s been a rollercoaster ride for carbon markets over the past 12 months, with policy changes and ongoing scrutiny seeing some of the most historically stable voluntary carbon credits facing price pressure. The latest analysis from Viridios’ AI-powered carbon credit pricing platform VAI shows that despite some  negative market sentiment certain methodologies and geographies continue to trade at a premium.

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Premium job listings

• Senior Engineer, Oil & Gas Sector with Carbon Market and Upstream Emission Reduction Project Expertise, ICA-Finance – Oslo
• Senior Program Officer, REDD+ Remote Sensing and GIS Analysis, Verra – Remote (Worldwide)
• Senior carbon/commodities trading analyst, RepuTex Energy – Melbourne
• Carbon Development Director, Impact Carbon – Remote/Flexible Location
• Manager, Energy and Industrial Innovation, Verra – Remote (Worldwide)
• Senior Program Officer, Industrial Innovations, Verra – Remote (Worldwide)
• Senior Program Officer, VCS Methodologies, Verra – Remote (Worldwide)
• Director, Africa Carbon Markets Initiative (ACMI), Global Energy Alliance for People and Planet (GEAPP) – Nairobi

Or click here to see all listings

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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 gonna cost you – The introduction of a carbon border adjustment mechanism in the EU may result in a 0.17% decrease in Russia’s GDP, the highest among Eurasian Economic Union countries and Uzbekistan, according to an analysis. Experts predict that the GDP of Kazakhstan, Armenia, and Uzbekistan will decline by 0.01%, and Belarus by 0.03%. Losses are expected to occur from the tax, set to begin from 2026 following a transitional period from Oct. 2023 till the end of 2025. The study also predicts higher losses if the EU implements more drastic measures: Russia’s losses could increase to 0.47% of GDP, Kazakhstan to 0.73%, Belarus to 0.22%, Uzbekistan to 0.11%, and Armenia to 0.1%. The proposed carbon tax in the EU was initially aimed at cement, electricity, fertilisers, ferrous metals, and aluminum supplies, but was expanded last year to include imports of hydrogen, organic chemical compounds, plastics, and products made from them into the EU. (Rosbalt)

Separation of powers – Shell is exploring options for its global renewable power operations, including a potential stake sale to outside investors, people with knowledge of the matter told Bloomberg. The UK energy giant is working with advisers to study a range of possibilities that could also include separating the business into a more independent unit. It has approached a number of international investors to gauge their interest in buying a stake, according to the sources. Discussions are still at an early stage, and there’s no certainty they will lead to a transaction.

No later – World nations must agree to phase out unabated fossil fuels “no later than 2050” and earlier if possible, says Steven Guilbeault, Canada’s minister of environment and climate change – with any residual oil and gas emissions mitigated thanks to carbon capture and storage technology, he told Euractiv in an interview. Guilbeault said Canada aligns with Europe’s objective to accelerate the deployment of renewables, increase energy efficiency, and reduce dependency on fossil fuels at the COP28 summit in Dubai. He added that Ottawa will soon table regulations for a net zero electricity grid by 2035, and that the country has “a more agnostic view” than the European Commission about which sectors should or shouldn’t use CCS technology.

EMEA

Blow me down! – Oil majors BP and TotalEnergies pledged to pay a combined €12.6 bln for the right to build wind farms in the North and Baltic seas in the world’s largest ever offshore wind auction, Clean Energy Wire reports. Environmentalists hailed the result as a “quantum leap” for the technology, as it showed how cheap renewables had become. The surprisingly high entry fee – described as “obscene” by an industry source – in the first tender of this kind in Germany reflects strong industry demand for green power, observers noted. But it also triggered concerns that German industry might end up paying more than it would hope for the electricity generated in the new wind farms, and that fossil fuel giants with deep pockets could harm competition in the offshore market.

Industry woes – German chemicals firm BASF this week cut its full-year earnings guidance, the latest in a string of chemical companies caught out by weak demand from industrial clients and higher interest rates, Reuters reports. In an unscheduled statement, BASF said earnings before interest and tax (EBIT) and adjusted for special items would be €4-4.4 bln in 2023. It had previously projected adjusted EBIT of €4.8-5.4 bln for the year, down from €6.9 bln in 2022. Analysts have recently pointed to weak EU industrial demand as a key bearish signal for carbon prices in the bloc.

Stricter ESG, if you please – Nearly 100 European asset managers, in partnership with ESG fund associations and a UN-supported network of financial companies, have urged the European Commission to revise the European Sustainability Reporting Standards (ESRS). The group argues that current ESRS proposals don’t provide the necessary data for making informed ESG decisions, impacting around 50,000 companies that disclose ESG data to investors. The coalition, which includes the European Sustainable Investment Forum, UNEP Finance Initiative, and investors like Fidelity and Nordea, sees the move from mandatory key disclosure indicators to those subject to materiality assessment as a significant decrease in ambition. They are calling on the Commission to maintain crucial climate disclosure indicators, require explanations for immaterial sustainability topics, reconsider optional disclosures on non-employees and biodiversity plans, and ensure ESRS compatibility with ISSB and GRI Standards. (CityWire)

ASIA PACIFIC

Green finance opportunity – HSBC is reportedly building up its green finance and bond teams in China despite geopolitical tensions, according to Reuters. The lender is planning to make key investments in its asset management arm in China this year, including the introduction of new teams dedicated to green assets and fixed income, the report said. HSBC is exploring offering carbon-offsetting products to customers, given the rising demand from Western multinational companies.

On track – Indonesia’s Financial Services Authority held a closed-door meeting with the House of Representatives Commission this week to discuss the implementation of the country’s carbon exchange, CNBC Indonesia reports. Inarno Djajadi, OJK chief executive overseeing capital markets, derivative finance and carbon exchanges, said the carbon exchange would still be launched according to the expected schedule of September this year, with OJK regulation to be issued as a rule before then. Estimates by the Indonesian Coal Mining Association say that the potential value for carbon trading in Indonesia could be $300 bln per year.

Pacific pledge – The International Fund for Agricultural Development (IFAD) and New Zealand have signed a $3.5 mln agreement to support Pacific communities to ensure sustainable access to water and health diets, IFAD announced. The small island and water project will reach 50,000 people – or 17% of the population – in the Federated States of Micronesia, Kiribati, the Marshall Islands, and Tuvalu, the announcement said. The project has seen a total of $19 mln invested so far, and is designed to strengthen the climate change resilience of small island communities by improving their food, nutrition and water security, and livelihood opportunities. Measures include composting, using renewable energy for poultry incubators, driers and pumps, and installing water supply infrastructure.

Working together – South Korea’s environment ministry has agreed to work with the country’s major trade group, the Korea Chamber of Commerce and Industry (KCCI), to establish a voluntary market, though the timeline for the new platform remains unclear, according to a statement released by the ministry on Thursday. The two parties said they will exchange information, develop demo projects, and conduct research and investigation activities to enhance the reliability of the voluntary market. KCCI is reportedly working on the establishment of a voluntary credit trading platform, which will be launched in the second half of this year at the earliest.

One step closer – Woodside Energy’s North West Shelf LNG facility is one step closer to having its life extended for nearly 50 years to 2070 after the Western Australia EPA dismissed appeals it should be stopped on climate science and cultural grounds, the Guardian reports. The facility which is one of Australia’s most polluting facilities, had applied to have its operating licence extended. Scientists and activists said in submissions to the EPA that if the extension was allowed it could lead to the opening of new gas fields to provide gas to keep the processing plant running until late this century. Woodside’s estimate of the annual emissions from the project suggest about 4 bln tCO2e could be released across all scopes – equivalent to about 10 years of Australia’s total carbon pollution. The EPA’s dismissal of the appeals lodged by interested parties does not give the project the green light, but is considered influential advice. The Perth-based head of clean energy transition at Greenpeace Australia Pacific, Jessica Panegyres, said the EPA had only a narrow mandate to consider the development’s impact, and called on the federal environment minister, Tanya Plibersek, to conduct her own assessment.

Leading edge –  Australian cattle industry group Meat and Livestock Australia is launching a new training programme, designed to provide information to grassfed beef, sheep and goat producers on the practices and technologies to help reduce and avoid emissions. MLA Program Manager for Adoption Sally Legio said in a statement that the Carbon Edge training package would address the current knowledge and skill gap by providing producers across Australia with the knowledge and skills required to generate and interpret a carbon account and formulate a customised plan to address emissions and production benefits at an enterprise level.” MLA Manager Margaret Jewell said the workshops would respond to the enquiries that MLA receive from the industry about what this all means at an individual business level. Five pilot workshops will be delivered from August, with the full programme to roll out in 2024.

AMERICAS

Carbon class – The Canadian federal government announced C$9 mln ($6.86 mln) for three Ontario universities to transition away from polluting energy sources in a press release on Thursday. The funds come from proceeds of the federal carbon price allocated for the Decarbonization Incentive Program. Western University will receive C$4.7 mln for installation of electric boilers, McMaster University will receive C$2.1 mln for the same upgrade, and York University will receive C$2.1 mln for an energy retrofit. The projects are expected to cut 35,000 tonnes of CO2 by 2030.

VOLUNTARY

Impact assessment – Carbon credit developer and intermediary South Pole was on Thursday the subject of a another article by Dutch investigative journalism outfit Follow the Money (FTM), several months on from FTM’s investigation on the extent of over-crediting at the company’s Kariba REDD forest protection project in Zimbabwe. Again drawing on anonymous current and former South Pole staff sources and leaked internal correspondence, FTM reported that more than 80 of the company’s 1,000+ staff in February wrote to South Pole’s management expressing deep concerns about the direction of the company’s business and proposed setting up a task force to “re-centre purpose and impact in South Pole’s decision-making”. It said employees were questioning whether the company’s priority “is still impact over profit” amid concerns over carbon project environmental integrity and high margins when reselling carbon credits. South Pole was reported as having acknowledged receiving the letter, which, according to them, “demonstrates the attachment of staff to our organisation and the will to maximize South Pole’s drive to create climate impact”, but the company noted that it doesn’t comment on private internal conversations to the media.

Kicking goals – Players in the Women’s World Cup in Australia and New Zealand are taking responsibility for their flights’ emissions, donating money to a combination of climate resilience and carbon offsetting initiatives. The projects the 44 players are supporting include the Koalas Forever project by WWF Australia, which involves drone seeding koala food and shelter tress to repair landslides in koala habitats in NSW, the Coastal Habitat Restoration project by WWF New Zealand, which helps protect sand dunes, and a Uganda Tree Planting project by DanChurchAid. The campaign was facilitated by Common Goal, a social and environmental collective movement in global football, and Football For Future, a UK-based climate advocacy football non-profit. While understanding that donating to climate resilience, carbon offsetting and adaptation initiatives are not the solutions to solve the climate crisis, the campaign recognises that these are short-term tools to compensate for players’ flights to and from the World Cup, a statement announcing the initiative said.

INVESTMENT

AVIATION

SCIENCE & TECH

AND FINALLY…

It all starts here – A team of geologists has identified Crawford Lake in Ontario, Canada, as the ideal site to mark the commencement of the Anthropocene epoch, characterised by significant human influence on Earth, New Scientist reports. However, the site must pass three more votes before official ratification by the International Union of Geological Sciences. The current geological epoch, the Holocene, began around 11,700 years ago after the last glacial period. Some scientists propose that the human impact since the mid-20th century, referred to as the Great Acceleration, signals the start of a new epoch dominated by human activity. The Anthropocene Working Group has been exploring various natural environmental archives to find the best evidence for this proposed epoch. Anthropocene is used to describe how humans have changed the Earth so much that their impact, from climate change to wildlife losses, will be visible in geological records, such as sediment and fossils, for millennia. The geologists have spent five years scouring the globe for signs of this impact, from sardine fish scales in a Japanese bay to fingerprints of climate change in the stalagmites of an Italian cave.

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