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CARBON FORWARD 2023

First integrity-tagged voluntary carbon credits delayed to early next year

The first batch of credits to be tagged with the Integrity Council for the Voluntary Carbon Market’s (ICVCM) label of quality will now be seen in “early 2024”, rather than the previous end-of-year target, the head of the cross-stakeholder initiative said on Friday.

VCM deemed a poor fit for institutional investors, while airline says has little option

The voluntary carbon market (VCM) is too small-scale and volatile to meet the needs of institutional investors for now, with some asset owners looking to bypass it altogether and invest directly into tree planting projects, according to a multinational asset management company.

Analysts bullish for carbon credits in the long term

Analysts painted a bullish long-term picture for the voluntary carbon market (VCM) on Friday, stating that they expect to see a premium for the ICVCM’s Core Carbon Principle (CCP) labelled credits that are due to appear from next year.

ASIA PACIFIC

FEATURE: One market to rule them all – ASEAN single carbon market seen far off, but interoperability the goal

A carbon credit fungible across all Southeast Asian markets would be a “brilliant” idea, according to a Singapore-based veteran carbon market expert, though much must happen before that can become reality.

Australia Market Roundup: Regulator issues 1.3 mln ACCUs, NSW looks to legislate emissions reduction targets

Australia’s Clean Energy Regulator (CER) has issued 1.3 million Australian Carbon Credit Units (ACCUs) in its latest update, over 400,000 of which went to projects owned by fossil fuel companies.

CN Markets: CEA price touches all-time high amid compliance demand, surge in trading volume

Allowances in the Chinese carbon market this week rose to their highest level since the market launched two years ago, with analysts expecting the carbon price to climb to above 85 yuan ($11.63) later this month due to strong compliance demand.

Taiwan updates offset rules to encourage voluntary project development

Taiwan has updated its management rules to streamline the development process of voluntary greenhouse gas (GHG) reduction projects, as the island is gearing up for a domestic carbon levy scheme as part of its Paris-aligned climate targets.

India needs more than $600 bln to decarbonise its steel, cement sector -report

India will need to spend $627 billion in order to decarbonise its steel and cement sectors so the country can realise its goal of reaching net zero, according to a report published this week.

EMEA

Senior EU lawmakers agree on way forward for carbon removal bill

Party coordinators in the European Parliament have preliminarily agreed on a united stance on what to count as a carbon removal as part of the bloc’s framework for certifying carbon removals, according to sources close to the matter.

Euro Markets: EUAs hit 6-week high amid volatile energy markets as price direction debate continues

EUAs jumped to a six-week high on Friday amid rising energy prices, as traders debated whether price direction reflected current or future fundamentals, or was subject to pressure from technical signals and natural gas; meanwhile UKAs posted an 18% weekly gain.

EU ministers to adopt bloc’s position for COP28 next week

The EU’s 27 environment ministers will meet in Luxembourg next Monday to agree a negotiating position for the upcoming COP28 UN climate summit, taking place in Dubai from Nov. 30.

AMERICAS

US unveils plans for seven clean hydrogen hubs to receive $7 bln

US President Joe Biden on Friday announced his administration would fund seven regional clean hydrogen hubs using $7 billion from the Bipartisan Infrastructure Law to create a national market.

Emitters ramp up V23 CCA and RGA holdings, financials accumulate V24s as spread trades dominate

Compliance players took on significant V23 California Carbon Allowance (CCA) and RGGI Allowance (RGA) length and parted with V24 units this week, while speculators did the opposite as traders rolled positions further out on the curve en masse, US Commodity Futures Trading Commission (CFTC) data showed Friday.

VOLUNTARY

Verra introduces new retirement reason for carbon credits within its registry

Carbon credit standards body Verra announced Thursday that it is introducing a “corporate emissions inventory accounting” option as an interim measure to increase transparency and reduce the risk of double counting.

BIODIVERSITY (FREE TO READ)

EU provides cash to launch Finland’s largest-ever biodiversity project

Finland will use EU funding to boost target habitats and garner private-sector funding to make biodiversity projects more financially sustainable, the government announced.

Businesses sign EU nature charter for singular approach for corporate nature actions

A group of 37 businesses and environmental organisations have signed the European Business Nature Commitment, following the EU’s Business and Nature Summit in Milan this week.

EU’s top environment official backs development of biodiversity credit methodologies

‘Greenwashing’ through biodiversity credits must be avoided via the development of robust methodologies, the director general for the environment at the European Commission has said.

Nature-related target guidance for finance to launch this year

Two guidance documents for financial institutions on setting nature-related targets will launch this year, led by the UN Environment Programme Finance Initiative (UNEP FI) and the Finance for Biodiversity foundation (FfB).

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CONFERENCES

Private Land Conservation Conference | Unite for Nature – Oct. 16-18, Canberra: Nature has been elevated to the world stage and the Australian Land Conservation Alliance’s Private Land Conservation plays a crucial role in exploring the challenges and solutions as we navigate the transition to a nature positive future. Featuring Australian and international conservation practitioners, policy experts, business, finance and industry leaders, landholders, and First Nations groups on the frontlines of conservation, the conference explores pathways to reversing nature loss. To register: www.alcaconference.org.au/registration

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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

Negative nations – India is planning to push for developed nations to become carbon negative rather than carbon neutral by 2050 at COP28, Reuters reports. Two Indian government officials explained that developed countries becoming carbon negative emitters would allow emerging economies to use fossil fuels to fulfill their development needs and enable the world to achieve the global net zero target by 2050. Meanwhile, India favours reducing overall carbon emissions through abatement and mitigation technologies, and plans to resist developed nations’ calls to finalise a deadline for fossil fuel phase down.

Banking bounce – The World Bank has officially expanded its mission to include climate change as it pushes reforms that could provide additional funding and friendlier loans to green projects, Climate Home reports. On Thursday, the World Bank’s governing body approved new language that its historical objective to “end poverty” should now be accomplished “on a liveable planet”. The new objective will give the lender a mandate to tackle a whole new range of issues, including climate change, and could allow the bank to increase lending by as much as 15.7 bln annually. The change came a year after a group of some of the largest shareholders, led by the US and Germany, called for a fundamental shift to increase climate finance. As opposed to the injection of new funding, the reforms largely centre around financial tweaks to make existing capital reach further, particularly concerning the International Bank for Reconstruction and Development (IBRD), the lending arm for middle-income countries. 

AMERICAS

Federal step back – Canada’s Supreme Court on Friday ruled in a majority opinion that the federal Liberal government’s Impact Assessment Act (IAA) is largely unconstitutional, affecting the mechanisms through which federal regulators can consider the potential environmental and social impacts of various resource and infrastructure projects. The IAA, previously known as Bill C-69, was enacted in 2019 and has been subject to strong dissent from conservative politicians who look to uphold provincial authority and jurisdiction over environmental issues in the face of federal powers. The federal Supreme Court decision was welcomed by Alberta Premier Danielle Smith and Ontario Premier Doug Ford. (CBC)

Uncertain operations – The largest US refinery conversion to renewable diesel (RD) production must resolve permitting issues before it can operate, a California judge clarified Thursday. The 67,000 barrels/day Rodeo Renewed project, headed by Phillips 66, still faces three issues raised by environmental groups that were not suitably addressed in the company’s approved permit in 2022, according to the Superior Court of Contra Costa County. While the facility plans for commercial operations to begin in the first quarter of 2024, the judgment leaves this earmark uncertain. However, construction on the facility can still continue in the meantime. (Argus)

EMEA

Green houses – Trilogue negotiations on the energy performance of buildings (EPBD) between the EU Commission, Council of member states, and Parliament took place last night, although the co-legislators failed to reach an agreement. Talks were “generally good”, within a “positive atmosphere”, and “there has been progress”, a spokesperson for the Council told Carbon Pulse. The same source said they have found a “common ground on important issues”. However, some points still require follow-up, and a final trilogue is expected in the next few months.

More nuclear now – The nationalist Sweden Democrats, who provide key support to the country’s three-party government, are stepping up pressure on Vattenfall to expand nuclear power production in order to meet growing demand for electrification. Sweden Democrats Leader Jimmie Akesson told Bloomberg that a separate company could be formed for such a purpose if the state-run utility doesn’t speed up. Vattenfall operates five of Sweden’s six reactors, which supply about a third of the country’s power, and is also studying the use of quick-to-build small modular reactors. Nuclear reactors are extremely expensive to build and often entail risks of delays due to their complicated design. The Swedish government has pledged credit guarantees of 400 bln Swedish kronor ($36 bln) for nuclear projects.

ASIA PACIFIC

Grand opening – Indonesia opened its inaugural green hydrogen production facility at the Muara Karang gas power plant in Jakarta this week, the Ministry of Energy and Mineral Resources announced. The plant is operated by PLN Nusantara Power, and is capable of producing 51 tonnes of hydrogen per year. PLN will use a solar PV array at the facility and the purchase of RECs to ensure the hydrogen produced is 100% renewable. The Ministry said green hydrogen features in its national action plan as part of efforts to reach net zero emissions by 2060 or earlier.

Not ready – A majority of Hong Kong-listed companies are not yet ready for more challenging climate-related reporting requirements set to be introduced next year, South China Moring Post reports, citing a survey by audit and consulting firm PwC. Companies will need to state the upstream and downstream activities that give rise to Scope 3 emissions, as early as next year, under a proposed rules change awaiting formal adoption by Hong Kong’s bourse. Despite the tight timeline, only a quarter of 300 companies PwC studied voluntarily made disclosures of their Scope 3 emissions in their 2022 financial year reports, and merely 2% of them have disclosed the value or percentage of their assets exposed to climate risks and opportunities.

AND FINALLY…

Danger of disappearing – As much as 40% of Antarctica’s ice shelves have reduced in size since the late 1990s, primarily on the western edge of the continent where the ocean is warmer, a new study published in the journal Science Advances has found. Of the continent’s 162 ice shelves, 72 of them lost mass in the period and although losing ice during calving is part of the natural life cycle of an ice shelf, the pattern of rapid ice loss of some of the shelves—including the Thwaites Glacier, which has shrunk by 70% since 1997—is troubling, say scientists. Ice shelves are huge pieces of ice that extend out over the ocean, serving as a buttress for the ice sheets on land. Without the protection of ice shelves, it’s possible that Antarctica’s massive glaciers could melt more quickly into the ocean and accelerate sea level rise.

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