Newsletters > CP Daily: Monday March 11, 2024

CP Daily: Monday March 11, 2024

Published 04:28 on March 12, 2024  /  Last updated at 04:28 on March 12, 2024  / /  Newsletters

A daily summary of our news plus bite-sized updates from around the world.

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TOP STORIES

US 2025 budget requests additional $27 bln in climate funding

The Biden administration’s $7.3 trillion fiscal 2025 budget plan requests an increase of $26.9 bln for climate programmes across US agencies, as well as funding for international climate finance, according to documents released Monday.

ANALYSIS: Washington carbon allowance holdings in limbo as fate of cap-and-invest scheme heads to November ballot

With voters set to decide the fate of Washington state’s cap-and-invest programme this November, market participants are highlighting the uncertainty surrounding hundreds of millions of dollars in carbon allowance holdings that could be rendered worthless if the scheme is scrapped.

ASIA PACIFIC

NZ Climate Commission warns of material NZU oversupply, calls for large cuts to auction volumes  

The volume of NZUs available at auction must be dramatically reduced to cut a surplus in New Zealand’s ETS that threatens to undermine its effectiveness, the country’s Climate Change Commission (CCC) said Tuesday.

Korean non-profit establishes council for voluntary market engagement

A South Korean non-profit dedicated to sustainable development has established a special council led by a climate policy veteran to facilitate the engagement of domestic companies in the voluntary carbon market.

Major Korean utility to pursue energy efficiency projects for Paris-aligned carbon credits

A subsidiary of South Korea’s largest power company has partnered with a domestic cement producer to conduct international energy efficient projects in the Asia-Pacific that can generate Paris-aligned carbon credits.

China urged to provide more support for CCS, carbon markets

China should provide policy support for the development of offshore carbon capture and storage (CCS) and accelerate the construction of its national carbon market, domestic business leaders have called for during the annual parliamentary session.

DAC developer partners with NZ Future Energy Centre on pilot project

A Direct Air Capture (DAC) project developer is partnering with New Zealand’s Future Energy Centre (Ara Ake) to help develop the first pilot project of its kind in the country, it announced Monday.

AMERICAS

PREVIEW: RGGI Q1 sale expected to trigger additional volumes

Market participants coalesced around expectations for the first RGGI allowance auction of 2024 to clear around the Cost Containment Reserve (CCR) trigger, with secondary market prices converging towards that level over the last month.

Reducing banked allowances in tightening cap-and-trade on the table at California joint committee hearing

ARB staff and a stakeholder panel discussed with lawmakers at a joint committee public hearing on Monday the option of reducing the pool of banked allowances, trimming free allocation, or lowering California’s emissions cap to increase cap-and-trade programme stringency, as well as the future of the scheme post 2030.

US DOE offers $425 mln towards clean energy production, decarbonisation in former coal communities

The US Department of Energy (DOE) announced $425 million in a second round of funding to support clean energy manufacturing, while reducing industrial emissions in former coal communities.

Oregon sets 2024 rulemaking timeline to re-establish scrapped Climate Protection Program

The Oregon Department of Environmental Protection (DEQ) on Monday announced a new rulemaking schedule to reinstate its market-based GHG reduction programme that a state court dismissed in December.

New York reconsiders sovereign debt rules as emerging economies push for relief to fund nature, climate

New York’s state legislature is advancing parallel bills to rewrite the rules of sovereign debt restructuring, in a potential hit to private creditors worldwide but a win for developing countries.

Voluntary registry releases draft North American biochar project protocol

A voluntary carbon market registry has released a North American biochar protocol for board consideration following a draft proposal accompanied by a public comment period.

VOLUNTARY

Just 6% of past voluntary carbon credit issuances likely to meet ICVCM’s CCP label -analysts

A little over 6% of historical credit issuances have a strong chance of receiving the CCP label by the Integrity Council for Voluntary Carbon Markets (ICVCM), with the tag potentially a more stringent marker of quality than CORSIA-eligible credits, according to market analysts.

VCM Report: KSET liquidation sparks sell off in voluntary carbon spots and futures

Standardised voluntary carbon spot contracts for old CORSIA and related futures tumbled this week from already low levels, in the wake of asset manager KraneShares announcing it will liquidate its KSET exchange-traded fund.

Experts underscore supply-demand imbalance across new generation of voluntary carbon credits

There is a strong imbalance between demand for a new generation of voluntary carbon credits, eligible for international mechanisms or with integrity labels, and expected supply, analysts told a conference last week.

Exchange to imminently launch CORSIA, REDD+ voluntary carbon futures

A Singapore-based exchange is expected to be ‘weeks away’ from launching two physically-settled voluntary carbon futures contracts, one focused on units eligible for the current phase of CORSIA, and the second on jurisdictional REDD+ credits.

Carbon utilisation and removal firm launches new DAC unit for agriculture

An Amsterdam-based climate tech company launched its second direct air capture unit for onsite carbon capture and utilisation in large greenhouses and vertical farms.

EMEA

Europe unprepared to face climate risks -report

Europe is not prepared for all the climate risks it will face in the coming years, despite being the fastest-warming continent in the world, according to the first-ever EU Climate Risk Assessment Report published on Monday by the European Environment Agency (EEA).

UK govt buys land for new nuclear power projects

The UK’s state-owned nuclear energy and fuels company is buying land for future developments, as part of the government’s plans for a “revival” in the technology that includes developing a new large-scale reactor and mini plants.

BofA eyes EU carbon trading growth -Bloomberg

Bank of America (BofA) plans to expand its carbon trading business and sees significant growth in the European markets, members of the firm told Bloomberg.

Euro Markets: EUAs drop most in three weeks on weaker gas, short-covering trend seen ending

European carbon prices fell by the biggest margin in three weeks on Monday, led lower by weakening natural gas prices that shrugged off an unplanned outage in the North Sea and suggestions that traders may be starting to unwind long positions ahead of the March options contract expiry, with the spate of short covering seen last week also said to be ending.

BIODIVERSITY (FREE TO READ)

Russia-Ukraine war to trigger cropland expansion worldwide, study says

The Russian invasion of Ukraine could lead to cropland expanding over eight million hectares worldwide, driving biodiversity loss as far away as the Americas, a study has estimated.

Overlooked umbrella species could better inform conservation programmes, study finds

Rethinking the monitoring criteria of umbrella species will enhance biodiversity conservation efforts, leading to more efficient and cost-saving programmes, researchers have found.

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MEDIA ROUNDTABLE

Corporate views on voluntary carbon markets revealed – A new survey of more than 180 executives and managers will uncover private sector perspectives on voluntary carbon markets in corporate climate action. The survey results, coordinated by the We Mean Business Coalition, will identify the barriers and opportunities for companies, and will offer a number of recommendations for improving market infrastructure to unlock more corporate climate finance. Journalists can register here for an embargoed online roundtable on Wednesday, March 13 at 1400 CET (0800 EST) to discuss the results with the authors.

CONFERENCES

North American Carbon World (NACW) 2024 – March 19-21, San Francisco: Attend NACW 2024 to learn, collaborate, and network with the North American carbon community and provide a stronger, unified force in advancing climate solutions. Hosted by the Climate Action Reserve, NACW will dive into major new policies, innovations, and developments that will shape and scale carbon markets and climate solutions with integrity and ambition. In addition to outstanding speakers, discussions, and insights, NACW provides premier networking opportunities with an active and engaged audience of leading climate and carbon professionals from all sectors of the economy. www.nacwconference.com

European Climate Summit – April 16-18, Florence: To kick off its annual regional climate summit series this year, IETA looks forward to welcoming delegates to its flagship ECS2024 event, taking place in Italy. ECS comes at a key inflection point for the region’s carbon market. How will the European carbon market evolve in its next phase, which starts in 2031? Around the world, carbon markets are emerging at the fastest ever pace, with new emissions trading systems being developed from Brazil to Vietnam. More markets may mean more opportunities for international cooperation and linking, and some of these could come to Europe. The health of the voluntary carbon market is also a hot topic this year, as the market works to overcome challenges. Environmental integrity and robust quality assurance are at the top of everyone’s mind, and IETA’s ECS2024 will address these issues as well. To register, simply click HERE to join as a delegate. In-person event.

Next steps for the UK Emissions Trading Scheme – April 22, Online: Hosted by Westminster Energy, Environment & Transport Forum, stakeholders and policymakers will explore priorities for implementation and maximising the carbon market’s contribution toward the UK’s net zero strategy. Discussion will consider policy priorities, challenges for industries, and plans to expand the scheme to include domestic shipping and energy from waste. Sessions will also explore the auction reserve price, the forthcoming CBAM, and strategies to enhance the UK ETS’s efficacy while mitigating negative impacts. Book your place

Carbon Forward Turkiye – May 9-10, Izmir: With the launch of the pilot ETS in Q4 and a burgeoning voluntary carbon market in the country, this event will give attendees an understanding of the significant impact these schemes, as well as the EU’s CBAM, will have on your business. Full conference agenda coming soon. Secure your spot

Argus Asia Carbon Conference – May 13-15, Kuala Lumpur: Join over 200 industry leaders and senior government officials at the Argus Asia Carbon Conference in Kuala Lumpur on 13-15 May 2024. Connect with key players and explore new opportunities in the region as we discuss innovations in carbon technology, advances in voluntary and compliance markets, the impact of CBAM, financing, nature-based project developments, and more. With ministerial addresses and keynote sessions from Petronas and SaraCarbon, this is your opportunity to gain valuable insights on pan-Asia’s evolving carbon markets. Register

Argus Europe Carbon Conference – May 21-23, Nice: Plan your carbon strategy through market-driven decarbonisation solutions at the at the Argus Europe Carbon Conference on 21-23 May in Nice, France, as we examine the EU ETS and other global compliance structures, voluntary carbon markets and their intersection with carbon abatement industries. This year’s agenda covers the integration of the maritime sector into the EU ETS, the impact of Europe’s exported carbon price through CBAM, developments in carbon removal technologies, voluntary certification methods, and developments around diverse, high-quality credits from Verra and many other leading standards. Register your place to explore new opportunities within Europe and globally.

Carbon Forward North America – June 11-12, Toronto: Join us in the Great White North to hear about the evolving carbon pricing and climate policy landscape in North America. Whether you are an emitter, investor, developer, or a new participant in any of the continent’s carbon markets – compliance or voluntary – Carbon Forward North America offers you the opportunity to gain knowledge on both present and future policy developments and market opportunities. Explore the chance to meet the right people or source the right solutions to help you enhance your business prospects or minimise your risk. Come meet the region’s world-leading carbon market experts, compliance players, government officials, investors, project developers, analysts, brokers, and other stakeholders. Agenda to be released soon. To express an interest in speaking or sponsoring, please email michelle@carbon-forward.com

Carbon Forward Expo – October 8-10, London and Online: Save the date! More info coming soon…

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BITE-SIZED UPDATES FROM AROUND THE WORLD

EMEA

Cold on ICE – The EU’s decision to ban new vehicles running on Internal Combustion Engines (ICE) as of 2035 is the least popular climate policy measure among voters in Germany, France, and Poland, according to a survey published last week, Euractiv reports. The survey, carried out by the Hertie School’s Jacques Delors Centre in Berlin, ranked climate policies according to their popularity among 15,000 respondents in the three countries. Of all policy proposals, bans were the least popular among respondents in all three countries, regardless of their political affiliation. “Banning combustion engine-powered cars, for example, constitutes the most unpopular measure in all three countries,” the survey says. “Similarly, regulatory curbs on gas and oil heaters are highly disliked, especially in Germany and Poland. Voters are also sceptical of carbon pricing, echoing findings from earlier studies,” the researchers add. On the other hand, the most popular options are government investments in green infrastructure like the electricity grid and public transport, green industrial strategies such as subsidies to help energy-intensive industries decarbonise, or support for the production of clean tech such as solar panels and wind turbines. The full survey is available here.

Removals backing – Agreement by most EU member states on a draft for an EU-wide standardised and voluntary certification framework for CO2 removal and carbon farming marks an important step for the bloc towards reaching international climate targets, the German economy and climate action ministry (BMWK) has said. GHG reduction must continue to be the priority, but a ramp-up in carbon removals will be necessary to achieve Paris Agreement targets, said state secretary Sven Giegold, adding that carbon removals could be a new income source for farmers and forest owners. In February, the European Parliament, the EU Council, and the Commission reached a provisional agreement on carbon removal standards, which must now be formally confirmed by the EU Parliament before certification methods and regulations for MRV for the various types of activity can be developed. Certifiable activities include DAC, BECCS, and potentially removals from farming. (Clean Energy Wire)

Aviation off track – The European aviation industry is likely to miss its target of reaching net zero emissions by 2050, the recently departed head of Amsterdam’s Schiphol airport, Ruud Sondag, told the Financial Times. Sondag said he fears governments in Europe will intervene to limit the industry’s growth with higher taxes or caps on flights unless it reduces its emissions in line with the Paris Agreement. European airlines and airports agreed in 2021 to reach net zero by 2050.

Some good news – The UK’s GHGs fell by 5.7% in 2023 to their lowest level since 1879, according to new Carbon Brief analysis. The research, based on preliminary government energy data, shows emissions fell to just 383 MtCO2e in 2023. This is the first time they have dropped below 400 MtCO2e since 1879. The UK’s emissions are now 53% below 1990 levels, while GDP has grown by 82%, with a YoY fall largely due to an 11% fall in gas demand. Coal use also fell by 23% in 2023 to its lowest level since the 1730s, as all but one of the UK’s remaining coal-fired power stations closed down.

Billions for batteries – NatPower UK, the UK arm of global energy transition developer NatPower Group, has pledged over £10 bln in the UK’s green energy market, including nationwide deployment of battery storage projects. The company has committed to rolling out more than 60 GWh of battery storage capacity by 2040, claiming to provide 15-20% of UK energy storage. The first three of its ”GigaParks” are set to enter planning permission this year, followed by 10 next year, said NatPower UK. Some £600 mln has also been earmarked for the development of substations in the initial phase, helping to overcome grid bottlenecks and connection delays. Last November, National Grid said it would accelerate the connection of about 10 GW of battery energy storage in England and Wales.

Humbersome – Drax Group has signed an MoU with Viking CCS, led by Harbour Energy and partnered with BP, to explore CO2 transportation and storage solutions in the UK’s Humber region. This collaboration will initiate an early pipeline study to assess the feasibility of connecting Drax Power Station to the Viking gas fields in the southern North Sea for CO2 storage. The Viking CCS project aims to capture and store up to 10 Mt of UK emissions annually by 2030 and potentially 15 Mt by 2035. This initiative is part of Drax’s ambition to implement BECCS technology at its power station, potentially removing 4 Mt of CO2 each year, aligning with the UK’s net zero goals and the government’s target for engineered GHG removals by 2030.

Moroccan power diverted – A £16 bln project to export solar and wind energy from Morocco may deliver power to Germany instead of the UK, Bloomberg reported. The developer, Xlinks, is now looking at three options — delivering power to the UK, delivering it to both the UK and Germany, or only to Germany. The addition of the German option is a remote possibility, Bloomberg reported, but it could put pressure on the UK to provide backing for the project. The project, which includes a large solar and wind farm in Morocco and batteries, had been slated to deliver power to 7 million homes in the UK.

Race to Rabat – The Moroccan government will allocate 1 mln hectares of land to green hydrogen projects and offer unspecified incentives to investors, according to a government statement on Monday covered by Reuters. Phase 1 will involve 300,000 ha. The offer from the solar- and wind-rich North African country applies to integrated projects covering the stages of electricity generation from renewable energy sources, renewables-powered electrolysis to glean hydrogen from water, and conversion of green hydrogen into ammonia, methanol, and synthetic fuel. The off-take will be both for export and for domestic use. Approximately 100 investors have reportedly already expressed interest in producing green hydrogen in Morocco.

One step closer – The Vice President of Nigeria last week inaugurated the carbon market activation plan committee to create a blueprint for driving “an efficient sustainable carbon market ecosystem” in the country, a statement released by the government said. The committee formed will work closely with the African Carbon Market Initiative to harness Nigeria’s vast carbon potential which exceeds $2 bln, it added. By the formation of this committee, the African nation hopes to attract investments into the country, which will lead to reduction in emissions and foster sustainable development. The country had already announced it would assemble the team to implement its carbon markets policies.

ASIA PACIFIC

Ammonia amigos – Vopak, a Dutch fossil fuel-infrastructure provider and Air Liquide, an international supplier of industrial gases have signed an agreement to develop low-carbon ammonia supply chains in Singapore, Reuters reported. Vopak Singapore said that the companies will work on developing infrastructure for ammonia import, cracking, storage, and hydrogen distribution in the city state, in order to help the industry shift to lower carbon feedstock.

AMERICAS

Whistleblower – The Washington State Department of Transportation (WSDOT) and the Governor’s Office of Financial Management (OFM) face a lawsuit from the Citizen Action Defense Fund filed Mar. 5 on behalf of retired WSDOT economist Scott Smith, who claims that he was improperly pressured to change his estimates of fuel costs, which he alleges forecasted that the cap-and-invest programme would have a significant impact on gas prices and gas tax revenue. Smith claims that he was then forced out of state service when he refused to change the numbers. He first filed a complaint in Dec. 2023, to which Governor Jay Inslee’s office responded that it receives its gasoline price and revenue information from the state Department of Ecology (ECY), not WSDOT. Further, the governor’s office added that the Washington State Legislature directed ECY to develop, implement, and conduct the cap-and-invest programme, not WSDOT. Lastly, the governor’s office said that the appropriate OFM official does not recall discussing the matter with Smith nor recall declaring that his work needed to be reviewed by OFM; that the Legislature eliminated Smith’s position, with functions transferred to the state’s Economic Revenue Forecast Council; and that WSDOT was considering Smith’s request to work remotely but he did not finish the process for decision-making.

Greenwashing risks – Two subcommittees of the Commodity Futures Trading Commission (CFTC) – the Future of Finance Subcommittee and Climate-Related Market Risk Subcommittee – will hold public meetings on Mar. 15 from 0930 to 1230 Eastern (1330-1630 GMT), the agency announced Monday. One of the workstreams each subcommittee will continue to discuss separately involves risks that arise in connection with carbon derivatives markets with a particular focus on fraud and greenwashing, market integrity, product design, and disclosure, the CFTC press release noted.

Uber e-savings – Ride-hailing service Uber announced app features that give customers data on CO2 emissions avoided if they use electric or hybrid vehicle options to encourage greener choices, Axios reported Monday. The “Emissions Savings” feature calculates CO2 savings when using Uber Green or Uber Comfort Electric cars versus UberX or Uber Comfort trips of the same distance, and is also available to teen account holders. The selection will be initially available in 15+ cities in the US and Canada.

Mexico blue carbon – A feasibility study assessing the commercialisation of blue carbon credits will be carried out in the Mexican state of Quintana Roo, announced nonprofit Friends of Sian Ka’an. The study’s aim is to analyse the viability of carbon market participation resulting from protected areas of seagrasses, wetlands, mangroves, and coastal aquatic areas in the southern Quintana Roo, reported La Jornada Maya on Sunday. The assessment will also investigate the volume of carbon stored in wetland restoration projects along the state’s coast. The overarching project, facilitated by Friends of Sian Ka’an, is supported by the European Commission and nonprofit International Slow Food Organization to allow the Maya Ka’an, a destination in central Quintana Roo, to better adapt to climate change.

VOLUNTARY

Code of conduct – Sylvera has voluntarily applied ICMA’s Code of Conduct for ESG ratings, it said Monday. The ICMA remains a voluntary application that some hope will ensure a minimum bar for governance standards, boosting confidence in ratings as a tool to navigate the VCM among participants, according to a release. The Code could serve as the foundation for oversight of carbon credit ratings firms in the future, Sylvera added, to help increase market trust. The UK recently announced it will regulate ESG ratings this week as part of a financial statement in March. It is expected that regulation will be built on the same principles laid out in the ICMA Code.

Desert crops – HyveGeo, a climate tech startup headquartered in the UK and with operations in the UAE, has grand plans to transform large areas of the desert into arable land for crops like wheat and maize. The company developing microalgae technology for carbon removal and soil regeneration is currently at the pilot stage but it is hoped that by the end of 2025 it will be at the commercial stage and starting to produce desert crops. HyveGeo aims to sell carbon credits through converting microalgae into both biofertilisers and biochar, with those products to be used on the land to enable its use for crops. At one megatonne capacity of algae production, HyveGeo expects to regenerate around 12,000 hectares of desert per year.

Too much risk – Over 200 companies had their net zero commitments “removed” by the Science-Based Targets initiative (SBTi) last week, including some of the best-known names in corporate sustainability. Among the 239 firms to have missed the deadline to set full net zero targets or to have chosen not to use the SBTi standard are Diageo, Vestas, Innocent Drinks, Unilever, and Proctor & Gamble. Some 60% of the 239 companies still have verified near-term targets, SBTi has pointed out. Nearly a quarter of those who missed the January deadline said they were not sure they could achieve net zero, with some expressing concerns about the risk of litigation if they failed to meet their promises.

AND FINALLY…

Game on – Lioness Games, led by founder Leonie Grundler, has launched its debut board game, Biome, amassing over $200,000 in Kickstarter orders swiftly. The nature-themed strategy game, designed for 1-4 players, incorporates card placement and tableau building around the seasons, focusing on biodiversity and strategic adaptation. With 120+ different plants and animals, Biome offers a dynamic gameplay experience, which Lioness said reflects Grundler’s passion for board games and nature, honed during her time in Berlin and her tech career at Airbnb. The game has received praise for its engaging mechanics and thematic depth, with portions of its profits dedicated to the Wildlife Conservation Network.

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