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TOP STORY

FEATURE: Property developers face growing pressure to account for carbon, boosting interest in credits

The slow-moving real estate sector is likely to have to increasingly turn to purchasing carbon credits, as it faces growing pressure to offset the residual emissions of developments and to operate in more emissions-regulated environments, even as many in the industry are sceptical about the credibility of carbon credit projects today.

INTERNATIONAL

Nations to consider Clean Development Mechanism future at Dubai climate summit, UN confirms

The future of the Kyoto-era Clean Development Mechanism (CDM) is to be discussed by governments at the upcoming COP28 climate summit in Dubai, a UN spokesperson told Carbon Pulse on Wednesday while confirming that it will still be possible to transfer and cancel CDM credits beyond a looming deadline, clearing up a point of confusion among stakeholders.

AMERICAS

Amazon countries agree on cooperation, highlight need for financing in efforts to protect rainforest

Eight countries home to the Amazon rainforest have agreed to advance innovative financing options to help protect the massive territory, according to a joint declaration issued late on Tuesday that failed to include a pledge to end deforestation by 2030.

California offset issuance exceeds 250 mln with new large forestry project, as DEBs credit spread blows out past $10

All-time California Carbon Offset (CCO) issuances surged past the 250 million mark this week as a new improved forest management (IFM) project earned a significant credit batch, according to state data published Wednesday, while the price premium credits with direct environmental benefits to the state (DEBs) rose into the double digits.

US govt awards $13 mln to support carbon removal projects

US President Joe Biden’s administration on Wednesday announced it has invested over $13 mln in nearly two dozen carbon dioxide removal (CDR) projects across a variety of different technologies.

CAR publishes draft low-carbon cement protocol for US concrete producers

Carbon market standards body Climate Action Reserve (CAR) released its draft cement crediting methodology on Wednesday for public consultation.

Canadian oil sands absolute emissions hold steady in 2022, despite increase in production

Reductions in GHG intensity and modest production growth contributed to a maintenance of the absolute emissions of Canadian oil sands last year, even amidst an increase in output, according to new analysis released Wednesday.

Canadian companies announce carbon removal pilot facility in southern Quebec

Two Canada-based firms will construct a pilot carbon capture facility to sequester up to 1,000 tonnes of CO2 annually and support a wide rollout of removal technology across Canada, the companies announced Wednesday.

Canadian bank poaches emissions trader from competitor after string of exits

One of Canada’s largest financial institutions has hired a carbon trader from a competitor after recent turnover on the environmental markets desk, Carbon Pulse has learned.

ASIA PACIFIC

Indonesia’s sovereign wealth fund teams up with global climate, carbon advisory to invest in NBS projects

Indonesia Investment Authority (INA) has partnered with a global climate change advisory and investment firm to explore nature-based solutions investment and strategic opportunities in the Southeast Asian country, they announced Wednesday.

AU Market: ACCU price jumps 5% after patchy July period

The price of Australian Carbon Credit Units (ACCUs) jumped 5% on Wednesday as traders were made to pay higher in order to unlock supply.

SK Market: Monthly KAU auction fails to sell out again, with clearing price hitting new low

South Korea on Wednesday sold fewer than 40% of the allowances on offer in its monthly CO2 permit auction amid dwindling buy interest, with the clearing price crashing to a new all-time low.

Australian energy company sued over ‘carbon neutral’ electricity and gas claims

A group of climate activists has sued one of Australia’s biggest energy companies over what it claims to be greenwashing, as the firm offers “carbon neutral” electricity and gas to customers based on the purchase of carbon credits.

Pollination CEO gets tapped to chair Australia’s A$15 bln National Reconstruction Fund

The head of a global climate investment and advisory firm has been appointed chair of Australia’s A$15 billion ($9.8 bln) National Reconstruction Fund.

EMEA

Euro Markets: EUAs surge early on position data but rally fizzles despite rocketing natural gas prices

European carbon prices rose sharply mid-morning on Wednesday after weekly Commitment of Traders data showed that investment funds had turned a net long position into net short, but gave up all the day’s gains in the afternoon even though natural gas prices rocketed by as much as 40%.

Poland persists in legal fight against EU climate policies with fresh filings on ETS2 and CBAM

Poland has filed legal challenges to the EU’s highest court against the bloc’s planned second carbon market and carbon border adjustment mechanism (CBAM), the government said on Wednesday, the latest in a series of cases Warsaw has submitted over the EU’s Fit for 55 climate policy package.

German government agrees compromise on hike of domestic carbon price -Bloomberg

Germany’s coalition government has agreed to raise its domestic carbon price for buildings and transport but to a level still below its pre-energy crisis upward trajectory, Bloomberg reported on Wednesday, citing anonymous sources.

Another EU steelmaker flags weak economic outlook in quarterly results

A steelmaker headquartered in the EU has signalled its outlook for production in the region is the weakest across its global portfolio, joining other members of European heavy industry in a pessimistic economic view for the continent for the remainder of 2023.

VOLUNTARY

Rating agency forges links with Brazilian scientists to bolster nature project scrutiny

A carbon credit rating agency has partnered with Brazilian scientists to improve its assessments of the South American country’s many forestry projects.

Californian carbon credit developer touts for nature-based initiatives after investment

A California-based carbon credit developer is seeking out opportunities to invest in both project-level and larger scale jurisdictional avoided deforestation after earlier having secured up to $640 million in financing.

BIODIVERSITY (FREE TO READ)

Biodiversity poised to become more important selection criteria in offshore wind power projects -industry

As lower costs and less need for government subsidies are sparking rapid growth in the offshore wind power sector, biodiversity considerations are likely to become decisive factors in the project selection process, according to industry stakeholders.

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Premium job listings

• Carbon Development Director, Impact Carbon – Remote/Flexible Location
• Compliance Officer, Verra – Remote (Worldwide)
• Land Use Methodology Development Manager, GreenCollar Group – Australia/US
• Senior Program Officer, Forest Carbon Innovation Operations, Verra – Remote (Worldwide)
• Senior Engineer, Oil & Gas Sector with Carbon Market and Upstream Emission Reduction Project Expertise, ICA-Finance – Oslo

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CONFERENCES

Argus North American Biofuels, LCFS & Carbon Markets Summit – Sep. 11-13, Monterey, CA: Join 600+ key government representatives and industry stakeholders from across the entire biofuels value chain and carbon markets sector for three days of networking and knowledge exchange. Hear from leading policy makers from California, Oregon, Washington, Canada’s ECCC, Alberta, and British Columbia and industry experts from LanzaJet, BMW of North America, Morgan Stanley, Chevron, Southwest, Mercuria, Radicle, Phillips 66 and more. Take advantage of this opportunity to gather the latest policy and market insights and reconnect with industry peers. Learn more here.

North America Climate Summit – Sep. 19-21, New York City: The International Emissions Trading Association (IETA) looks forward to welcoming delegates to our flagship North America Climate Summit (NACS) 2023, an official accredited event of New York Climate Week 2023 and the UN General Assembly 2023. The Summit is the ideal forum to take stock of the world’s evolving net zero landscape and clean growth opportunities, and a zoom into North America. Hear from policymakers, business leaders and innovators who are leading the pack in building, scaling and collaborating on carbon pricing and markets for net zero. Register 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

Soaring CDR – Almost 3.4 mln tonnes of carbon dioxide removal (CDR) credits were bought in the first half of 2023, bringing the total volume to date to 4.1 mln, according to the tracker website CDR.FYI, it announced on X (formerly Twitter). But the top four advance purchases accounted for the bulk of the volume.  Microsoft announced a 2.76 mln credit purchase of CDR credits from Danish company Orsted. This was followed by purchases by NextGen, a joint venture between South Pole and Mitsubishi Corporation, buying 193,125 credits from three projects, including the Direct Air Capture project in Texas developed by 1PointFive,  a biomass removal project in the US called the Summit Carbon Solutions, and also Carbo Culture’s biochar project in Finland. Then Frontier, a foundation which includes founders Stripe, Alphabet, Shopify, Meta, McKinsey Sustainability, and members Autodesk, H&M Group, and Workday, purchased 1120,000 credits from Charm’s waste biomass project. Finally, JPMorgan Chase bought 800,000 credits of CDR commitments. The bulk of the bank’s commitment, as much as 450,000 credits, was through a 15-year deal with a little-known Vancouver-based firm CO280. The bank also agreed to buy 25,000 credits from Swiss direct air capture (DAC) firm Climeworks, and 28,500 credits from Charm. Despite the jump in purchases in 2023, only 33,636 credits were delivered in the first half of the year.

Not worth the money – Most airline passengers are still not willing to pay to offset carbon emissions from their flights, two of Brazil’s largest carriers have said, as the sector searches for ways to fulfill its goal of reaching net zero emissions by 2050, Reuters reports. Initial experiments by Gol and Azul saw only a tiny proportion of their flyers engage in voluntary carbon reduction projects, the firms said, suggesting passengers do not wish to spend their own money to offset emissions.

Kelp sinking credits – Ocean carbon removal company Running Tide has completed the first ever carbon removal for its first customer, Shopify, delivering 100 credits, it announced Wednesday. The company, which was founded in 2017, raised $54 mln in Series B funding in January 2022, helping it expand into a 120-strong team to operate removal project in the sea south off Iceland. The US-based company develops floating kelp farms in the North Atlantic. The fast-growing macroalgae eventually sinks to the ocean floor, storing away thousands of tons of carbon dioxide in the process. Running Tide plans to scale to be able to remove 1 bln tCO2e a year.

Blockchain bolster – Carbon trading company Changeblock has received a $250,000 investment from Emurgo Africa, the Africa and Middle East-focused venture arm of Emurgo, a prominent founding entity behind the Cardano blockchain. Emurgo Africa plans for the investment to contribute to the growth of Changeblock’s innovative solutions and strengthen the company’s position in the carbon market technology space. It also aligns with Emurgo Africa’s overarching vision of advancing blockchain adoption and fostering economic growth and social progress in Africa and the Middle East.

EMEA

Polls of polls – Right-wing and Eurosceptic parties are set to surge in the next European election at the expense of centrist parties, polling analysis by Politico shows. If elections were held today, the right-wing European Conservatives and Reformists (ECR) would become the third-biggest group in the European Parliament, tied with the centrist Renew, with 89 seats. That would mean an increase of 23 seats from the 2019 elections for the ECR, which includes Poland’s ruling nationalist Law and Justice party and Italian prime minister’s Giorgia Meloni’s far-right Brothers of Italy.

Sicilian bonus – A new aid, known as “Sicilian Energy Bonus”, got the EU green light on Wednesday. Taking the form of direct grants, the €150 mln Italian scheme will support companies active in the region of Sicily, in all sectors with a number of exceptions, such as primary agriculture, fishery and banking. The purpose of the scheme is to compensate eligible beneficiaries for part of the cost increase of gas and electricity incurred during 2022, compared to 2021, and to help them overcome their financial difficulties linked to the current crisis. In particular, the aid will not exceed €2 mLn per company and  will be granted no later than 31 December 2023.

Mining in Sevilla – A €27 mln Spanish measure will help Cobre Las Cruces (CLC) upgrade its refinery in Gerena, Sevilla, the Commission also announced. The measure will help CLC transform its mono-metallurgical refinery, exclusively extracting and producing copper to date, into a poly-metallurgical refinery. The upgraded single integrated refinery will be capable of extracting and producing copper, zinc, lead and silver. According to the executive vice-president Margrethe Vestager, the state aid will allowing CLC “to produce various key metals necessary for the transition to a decarbonised economy”.

South Africa delays – South Africa’s government will need another two to three months to complete an energy transition implementation plan, further delaying the flow of funds from its $8.5 bln JETP climate finance agreement with some of the world’s richest countries, reports Bloomberg. Ensuring that works in coal-dependent regions are re-skilled as coal plants close down is one of the hold-ups, while a government decision that state utility Eskom Holdings would be limited in its ability to take on further loans and government debt guarantees has further complicated matters. France, Germany, the US, UK and the EU offered the finance to help South Africa transition away from coal, which is currently the source of more than 80% of the country’s power.

No need to lecture – Germany should stop trying to impose its views on nuclear power on the rest of the EU, the head of one of Europe’s largest utilities has warned, as he stressed its importance in the region’s clean energy transition, the FT reports. Leonhard Birnbaum, CEO of German energy provider E.ON, said Berlin should accept differences of opinion as he signalled his desire for a compromise with France to break a deadlock over energy reforms. Germany this year shut down its final three nuclear power plants as it followed through on a long-held promise to drop the use of the energy source, while Paris has made it a priority to modernise its nuclear power plants. E.ON also reported quarterly results on Wednesday.

ASIA PACIFIC

More sun and wind in Maharashtra – Tata Power signed a Memorandum of Understanding (MoU) with the Government of Maharashtra to develop two pumped hydro storage projects with a combined capacity of 2,800 MW. The projects worth 13,000 crore rupees will be situated in Pune and Raigad districts of Maharashtra and will generate employment for over 6,000 people, Mint reported on Wednesday. Praveer Sinha, CEO & MD, Tata Power said that pumped hydro storage is a reliable and efficient way to store energy, and these projects will support the renewable solar and wind projects to ensure reliable, 24/7 consistent power supply. Tata Power already operates three hydro power projects in the state, Khopoli Hydro Generating Station, Bhivpuri Hydro Generating Station, and Bhira Hydro Generating Station.

Ready for CBAM – Jindal Stainless, stainless steel manufacturer, is preparing for the EU’s Cross Border Adjustment Mechanism (CBAM) by reducing its Scope 3 emissions, Financial Express reported on Wednesday. The company’s managing director Abhyuday Jindal said that Jindal Stainless has already invested in renewable power and is now going for hydrogen power as well. Jindal added that while the EU’s carbon tax is a challenge for the whole industry, the company, which is already 95% scrap based, is focusing on Scope 3 emissions by bringing all its suppliers on a technological automated platform.

Support cut – The Commonwealth Bank of Australia (CBA), the country’s biggest bank, has vowed to cut funding of fossil fuel projects, the Canberra Times reports. In its updated climate policy, released Wednesday, the bank has ruled out directly financing new and expanded oil and gas extraction projects, and from 2025 will require fossil fuel clients to publish independently verified plans to cut emissions. Financing key infrastructure, such as pipelines to new oil field, will also be precluded. However the bank has not ruled out financing new LNG processing plants, and will continue to fund metallurgical coal mines if deemed in line with the Paris Agreement. CBA reduced the emissions intensity of its portfolio by 23% from 2020 to June, 2022 and decreased lending exposures to oil and gas customers by 56% since 2021. Climate and activist shareholder groups said CBA’s new policy was far better than its Australian peers, but there were still major gaps to be addressed.

National hydrogen standards –  Chinese regulators have released the country’s first national-level guidelines for establishing standards for the hydrogen energy sector, South China Morning Post reports. The country aims to introduce a system that includes more than 30 national and industry-level standards covering the full value chain of hydrogen by 2025, from production and storage to transport and usage, government documents showed. China, the largest hydrogen supplier in the world, is capable of producing 33 mln tonnes of hydrogen every year, accounting for about 30% of global production, according to Xinhua.

Government support – Japan’s New Energy and Industrial Technology Development Organization (NEDO) has launched a project to help decarbonise thermal processes in the manufacturing sector, with a total budget of 30.41 bln yen ($212 mln), the state-backed agency announced Wednesday. NEDO plans to develop basic technology for carbon-neutral industrial furnaces by FY2026 and establish 50% co-firing industrial furnaces using natural gas and ammonia until FY2031, it said. As part of the country’s ‘green growth’ strategy, the Japanese government has established a fund totalling 2 trillion yen with NEDO to support the development of green innovations.

AMERICAS

Rules review – Conservative Democratic US Senator Joe Manchin of West Virginia says the Federal Energy Regulatory Commission (FERC) has agreed to his request to review the impact of proposed EPA power plant rules. The EPA is looking to regulate coal- and natural gas-powered plants under the Clean Air Act, but opponents of the plan argue that the proposed rules would shut down plants and endanger the reliability of the electrical grid. As Chairman of the Senate Energy and Natural Resources Committee, Manchin’s questioning of the rules puts him in a position more closely aligned with the 39 Republican Senators calling for the proposed rules to be withdrawn than with the Biden administration. Opponents have also argued that the proposed rules violate last year’s Supreme Court ruling that limited the power of the EPA to regulate emissions from power plants (Bluefield Daily Telegraph).

You Wynne some, you lose some – Wynnewood Refining is challenging the US EPA’s final action denying the company’s request for a small refinery exemption under the Renewable Fuel Standard for the 2022 compliance year. The Oklahoma-based small crude oil refinery filed the petition for review with the US Court of Appeals for the Fifth Circuit on Tuesday under the Clean Air Act. The EPA had denied its request because “the individual small refineries have failed to demonstrate that compliance with their RFS obligations would cause disproportionate economic hardship,” according to the agency. (Bloomberg Law)

Municipal RNG resistance — FortisBC, a regulated utility company in British Columbia, faces increasing pressure from local municipalities regarding its proposal to provide newly built homes with 100% RNG, first filed in 2020. The project, currently subject to regulatory approval by the BC Utilities Commission, is opposed by the cities of Vancouver, Surrey, Victoria, and Richmond. The interveners claim that most of the contracted RNG would come from outside BC, with customers to receive a mostly fossil gas mix alongside payment of international RNG suppliers for offsets. The City of Richmond is pressuring the provincial government to instead accelerate the phase-out of gas heating. (North Shore News) 

AND FINALLY…

Speedy sailors – Researchers keen to better understand the health of the seas are calling upon competitive sailing crews to carry sensors on their vessels to detect acidity levels, temperatures or microplastic concentrations in locations that vessels rarely, if ever, traverse. Boats in The Ocean Race, Vendee Globe and the Clipper Round the World Race are taking part in the plight to measure how much CO2 has dissolved in seawater surfaces. Their impact isn’t insignificant either. From Nov. 2020 to Jan. 2021, Vendee Globe racers provided about half the global observations on dissolved CO2 during that period. Sailors also choose to sacrifice some speed in doing so, because adding a 20-kilogram sensor adds unwanted weight, which sailors usually go out of their way to minimise. (Bloomberg Green)

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