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TOP STORY
WCI Markets: CCAs plunge to near March lows in four-day aggressive sell-off
California Carbon Allowance (CCA) prices in the secondary market stumbled for the fourth consecutive day on Tuesday while recording large daily ICE volumes, with heightened options activity exacerbating the technical sell-off, market participants said.
EMEA
Farmers stage last protest in Brussels ahead of EU elections
Some 500 tractors descended in Brussels on Tuesday to protest against green regulations and EU bureaucracy ahead of the European elections on 6-9 June, but with fewer participants than expected and amid accusations of politicisation by the far-right.
INTERVIEW: Polish government moving ahead with plans to create separate coal entity, PGE vice-president says
Poland’s state-owned power company has said the country’s government is moving forward with mooted plans to transfer coal assets to a state-backed entity, adding ageing and highly emitting coal plants are causing losses for the utility.
UK clean energy investments rise, but private finance worldwide still lags -report
UK financial institutions nearly tripled their investment in clean energy project between 2022 and 2023 to $2.3 billion, although gaps in commitments and transparency persist, according to a report published this week.
Malawi finance ministry says time is now for carbon market investment -media
Malawi’s finance ministry has said that the country is ready to ramp up investment in carbon markets days after finalising key legislation, according to local media reports.
Euro Markets: EUAs drop to two-week low amid aggressive selling as gas prices unwind gains
European carbon allowances weakened steadily on Tuesday afternoon after a volatile morning as the market tracked developments in gas, where prices fell sharply on news that an outage in the North Sea may be resolved quicker than had been expected, while UKAs also fell but trimmed their discount to EUAs to the narrowest in 15 months.
AMERICAS
PREVIEW: Market expects record RGGI Q2 auction clear, but still at discount to front-month futures
Market participants expect the second RGGI auction of the year to set another historic clearance price, albeit at a discount to secondary market valuations, with many traders projecting a wide range of outcomes in light of regulatory uncertainty in the market.
PREVIEW: Traders largely expect Q2 Washington carbon permit auction to clear near floor
Traders anticipate Washington’s upcoming second quarter current vintage auction to clear near the scheme’s floor and well below front-month futures prices, expecting the sale to sell all permits despite the looming possibility of the carbon market’s repeal.
LATAM debuts homegrown measures to spur carbon markets in 2024
Latin American governments are looking inward, developing domestic carbon pricing instruments in 2024, in hopes of kickstarting market development where international actors have failed, according to regional experts speaking Tuesday at the Argentina Carbon Forum in Buenos Aires.
ASIA PACIFIC
Vietnamese, German firms team up for developing large forestry project
A Vietnamese forestry and biodiversity company has partnered with a German carbon offset developer for implementing a project that will see trees planted across 1 million hectares of land in Vietnam.
NZ Market: NZU price rises 10% as speculator-driven bounce continues
New Zealand carbon allowances climbed 10% in Tuesday trade amid continued speculator demand and as the market digests what little there was for it in last week’s budget.
Rio Tinto debuts novel, clean steelmaking process
Australian mining giant Rio Tinto announced Tuesday it will spend $143 million on an R&D facility to assess the effectiveness of its novel low-carbon ironmaking process, dubbed BioIron, that it says could cut up to 95% of the emissions associated with steelmaking.
Australia explores Guarantee of Origin scheme to encourage green metals development
The Australian government is looking at its Guarantee of Origin scheme (GO) as a potential demand-side driver of green metals development in the country alongside a raft of other measures, according to a consultation paper released Tuesday.
Pollination launches A$150-mln Australian-focused climate and nature fund
Investment and advisory firm Pollination has launched a venture capital fund it says will drive new investment into Australian climate and nature technology and solutions.
Report calls for more Indigenous blue carbon opportunities in Australia
Analysis released this week has found Australian Indigenous peoples hold legal right or consent to develop carbon projects along 66% of Australia’s coastline, but are unable to do so due to a lack of applicable methods.
INTERNATIONAL
Integrate carbon removals into compliance markets to scale demand -Oxford
More robust policy to support carbon removals (CDR) and integration into compliance markets will be needed to boost demand to the levels needed to meet the Paris Agreement goal, say University of Oxford scientists.
Renewables targets need to be stronger for 1.5C world, IEA says
Countries are on track to fall well short of the goal of tripling renewable penetration by the end of this decade, and even if all planned new capacity gets installed by the end of the decade it will still be insufficient to align with the 1.5C target, the International Energy Agency (IEA) said Tuesday.
VOLUNTARY
Guardian ‘open’ to writing positive stories about VCM, when they emerge
“Good projects” have been caught up in the controversy about the voluntary carbon market exposed by the Guardian, acknowledged one of the journalists who wrote the stories, adding that editors at the UK-based newspaper were committed to write about “good examples” when they emerge.
FEATURE: Paris Olympics to use range of voluntary carbon credits in bid to be ‘Greenest Games’
The Paris Olympics is purchasing credits from a variety of carbon projects in the local region and abroad to offset its residual emissions, while striving to halve emissions compared to previous Games to reach a total of around 1.5 million tonnes of CO2 emissions.
Voluntary market needs paradigm shift, must embrace carbon finance for transition, says ex-Verra boss
Voluntary carbon markets require a paradigm shift that moves beyond treating a tonne of carbon as an ultimate end and must embrace finance for adopting a transitional approach, the ex-CEO of Verra said in a report published Tuesday.
Scientist warns against voluntary carbon scandals slowing rainforest conservation
A scientist featured as part of media reporting on scandals in the voluntary carbon market has warned against letting the pervasive negative criticism impact rainforest conservation, outlining a ‘medium term’ role for REDD+ credits.
Carbon capture firm unveils new technology in bid to slash costs 50% by 2030
A direct air capture (DAC) company has unveiled a new iteration of its technology as it aims to scale carbon removal capacity globally and slash costs, also announcing that Australia represented its ‘next frontier’ as it signalled investment interest in the country.
Record number of companies set to release data on climate disclosure platform
A record number of companies are expected to release their data on a new climate disclosure platform, which has been designed to simplify corporate sustainability reporting and aid firms in aligning with emerging global standards.
European energy firm pre-buys 5 mln nature based carbon credits from platform
A European energy company has bought 5 million nature-based credits from a climate finance company in a bid to lock in fixed prices across the 2030s, according to a release Tuesday.
Carbon markets could unlock private green finance, but greater integrity needed
The perception of risk remains a significant roadblock to scaling private climate finance – especially in developing countries – but stronger policies and international standards for carbon pricing would help to unlock bigger and faster flows, a conference heard.
AVIATION
Air transport association estimates 2024 CORSIA carbon credit costs at $600 mln
An international group representing air transport providers has estimated industry costs this year of purchasing carbon credits for CORSIA compliance at $600 million, in a report published during its annual general meeting.
BIODIVERSITY (FREE TO READ)
Scotland backs standard for community benefits in nature projects
The Scottish government has backed a project to produce a certification standard for community participation in nature projects, with a wide net of collaborators spanning the private and public sectors.
Governments must leverage private sector’s interest in nature to take action on biodiversity, study says
Government-led mandatory schemes and voluntary market-based instruments must be combined to effectively protect biodiversity, a study published Tuesday said, calling on countries to harness the private sector’s growing interest in engaging on nature positive.
A fifth of Japan’s market capitalisation exposed to nature-related risks, study says
Nearly 20% of Japan’s market capitalisation is highly dependent on nature, with the energy, food, beverage, and tobacco sectors facing the highest risks, a study has found.
Dutch asset manager raises €12 mln to launch biodiversity fund
A Dutch investment manager has launched a fund seeking to finance innovative solutions to tackle the biodiversity crisis, with seed capital of €12 million, Carbon Pulse has learned.
PCX releases updated plastic credit standard, mandates third-party verification
Philippines-headquartered credit standard PCX Solutions has released an updated version of its plastic credit programme, formally mandating third-party verification and ruling out landfill activities of eligible projects.
SBTN flags challenges with setting nature-based targets for cities
The Science Based Targets Network (SBTN) highlighted challenges in its development of nature-based targets for cities including skills, data, and geographical differences on Tuesday.
Biodiversity Pulse: Tuesday June 4, 2024
A twice-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).
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BIOCHAR REPORT
Supercritical’s latest report reveals a 30x surge in biochar supply over the next four years, however 88% of this growth comes from low-quality credits. “Boom or Bust? 2024 Biochar Market Outlook” delves into the pressing challenges buyers face, offering exclusive data and trends from Supercritical’s own marketplace which covers 80% of the market. Discover why high-quality biochar commands premium prices and how savvy buyers secure long-term agreements amidst the scarcity. This essential report equips you with the insights needed to navigate the evolving biochar landscape and make informed decisions in this burgeoning market. Download the report
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WEBINAR
Surprises from analyzing over 500+ carbon projects – June 12th, 9AM BST: Join carbon market experts from Morgan Stanley, BCG, and Calyx Global as they discuss insights gained from evaluating carbon credit quality. The speakers will review the surprising project types with higher GHG integrity, due diligence best practices, and how to consider beyond carbon impacts. Learn what key factors play a critical role in assessing GHG integrity – helping you make more informed decisions. Register for the webinar here. You will receive an on-demand recording after the webinar if you register but cannot attend live.
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CONFERENCES
Carbon Forward North America – June 11-12, Toronto and Online: 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. To express an interest in speaking or sponsoring, please email michelle@carbon-forward.com
FREE PASSES: We have allocated a limited number of free passes for Carbon Forward North America to attendees representing medium and large companies that currently buy and retire voluntary carbon credits or are looking to do so in the future. If your organisation is an end user of carbon offsets or wants to learn more about offsetting, and is not from the energy or financial sectors, contact us to apply for a free pass. Maximum one per company.
Carbon Forward Expo – October 8-10, London and Online: Save the date! More info coming soon…
Argentina Carbon Forum – June 4-5, Buenos Aires: The Argentina Carbon Forum, a key initiative to strengthen carbon markets in the country, seeks to mobilise local actors and promote intensive climate action. This event opens doors for public-private sector organisations to leverage economic and environmental benefits by financing projects that mitigate climate change. It also offers business visibility, networking and access to valuable information, discussing issues such as markets and negotiations, implementation of emissions trading systems, and decarbonisation strategies. The Argentina Carbon Forum fosters collaboration and the development of innovative solutions for a sustainable future. Register here
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Premium job listings
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BITE-SIZED UPDATES FROM AROUND THE WORLD
INTERNATIONAL
Tax the rich – Rich individuals around the world must pay more to tackle the climate crisis, whether through taxes or charges on consumption, said Laurence Tubiana, one of the architects of the Paris Agreement. There is growing consensus around concepts such as a global wealth tax, a frequent flyer levy, or a carbon tax on international shipping, for example. The richest 1% of people globally are responsible for more GHG emissions than the 66% at the other end of the scale, yet they experience little of the vulnerability to climate shocks that are causing suffering and death, mainly among poorer people. While poor countries struggle to raise the estimated $1 trillion a year of external finance to help them cut emissions and deal with climate change. To avoid real conflict will require putting the social justice element upfront, Tubiana told the Guardian. She said she hoped the very rich would cooperate with governments on paying for the climate crisis and that it was “legitimate to talk about taxation” in the arena of climate. (the Guardian)
Al Jaber’s oil and gas pursuits – the Abu Dhabi National Oil Company (ADNOC) sought close to $100 bln worth of oil, gas, and petrochemical deals at last year’s COP28 summit, chaired by the company’s CEO Sultan Al Jaber, according to a report by the NGO Global Witness published on Wednesday. It found that ADNOC pursued 20 major international fossil fuel deals in 2023. Their total value, around $100 bln, is five times higher than the value of deals the company pursued in 2022 and 40% higher than in the previous four years combined, it said. The deals were negotiated with entities in or owned by this year’s COP29 host Azerbaijan, next year’s COP30 host Brazil, and recent COP27 host Egypt and COP26 host UK.
EMEA
Incentivising emissions reduction – French manufacturers cut CO2 emissions by an estimated 15% during the first eight years of the EU ETS (2005-2012), at around 5.4 mln tonnes a year. In total that equates to the CO2 emissions that Sweden emits in a year, for example. Output was unaffected by the costs of complying with this policy, according to the study by the EPoS Economic Research Center at the Universities of Bonn and Mannheim. Researchers found that French companies invest in energy saving production technologies to offset the buying of ETS allowances. “Pricing emissions is apparently a good way to make companies aware of potential cost savings and efficiency gains through green technologies,” said Ulrich Wagner from the EPoS Economic Research Center.
Coal compensation – Germany’s government has received approval in principle from Brussels to allocate subsidies worth €1.75 bln to coal major LEAG but with the payout of one-third of the sum contingent upon future power and CO2 prices, Euractiv reports. The payment to LEAG would come under the €40 bln package to smoothen Germany’s coal exit by 2038, providing support to the majors to shut down power plants. Germany required state aid approval from the European Commission before the funds could be disbursed. LEAG will get two tranches of money: €1.2 bln guaranteed for restoring the damage done to the environment by decades of open cast mining and paying pensions and the remaining €550 mln contingent upon the profitability of coal power until 2038. However, if the plants are unprofitable due to cheap renewables and high CO2 prices and would shut down anyway, then the government would end up not having to compensate the plant owners.
Italian innovation – The European Commission has given the green light to an Italian scheme to support a total of 4,590 MW of new capacity for electricity production from renewable energy sources, with approval given under EU State Aid rules. The scheme contributes to the objectives of the European Green Deal while helping to end dependence on Russian fossil fuels, it said in a communication. The measure, running Dec. 31, 2028, will be financed through a levy included in the electricity bills of final consumers. The scheme will focus on supporting new plants running on innovative, immature technologies like geothermal, offshore wind, floating solar, tidal, and wave. The aid will be provided by way of a two-way contract for difference for each kWh produced and projects will be selected through a transparent and non-discriminatory bidding process, where beneficiaries will bid on the incentive tariff (the strike price) needed to carry out each individual project. The purpose is to ensure long-term price stability for renewable energy producers.
‘Future of EU ETS’ group launched – The European Roundtable on Climate Change and Sustainable Transition (ERCST), a Brussels-based think tank, announced on Tuesday the launch of a new project on the EU ETS. “The ‘Future of the EU ETS’ project aims to provide original analytical insights, pinpoint challenges, and propose solutions for the evolution of the EU ETS during the second Phase of phase IV (2025-2030) and post-Phase IV,” the think-tank said in an emailed statement. The project’s advisory group includes industry groups like the European Chemical Industry Council (CEFIC), European steel association Eurofer, power industry association Eurelectric, Fertilizers Europe, Enel, ExxonMobil, and French utility EDF, among others. Governments represented in the group include the French Ministry of Energy Transition, the Danish Ministry of Climate, Energy and Utilities, and the Polish Ministry of Climate and Environment.
Footballers flying – Europe’s leading national football teams competing in Germany this summer under Euro 2024 could cut their travel emissions by nearly 60% if they avoided flying, according to new analysis by Travel Smart and Transport & Environment (T&E). In contrast, UEFA (Union of European Football Associations) and the hosts Germany, have made big efforts to promote train travel for fans. For example, Deutsche Bahn is offering fans with a Euro 2024 ticket reduced prices for travel around the country. But the football teams themselves have yet to set a clear goal on curbing transport emissions — Germany and Switzerland are the only national teams to commit to not flying during the group phase. In doing so, Germany will save up to 98% of CO2e. The study finds that elite footballers will pollute seven to nine times more through their transport alone over the month-long period than the average person emits over a whole month.
Saving mangroves in Ogoniland – The Hydrocarbon Pollution Remediation Project (HYPREP) in Ogoniland, Nigeria, has announced plans to link Ogoni communities to carbon credits by the preservation and restoration of mangroves. The pilot involves 560 hectares of mangrove restoration. Ogoni is an ethnic group located in southern Nigeria. When linked, these communities will be able to sell carbon credits and will also have access to international funding and support for sustainable livelihoods. HYPREP is already building capacity of Ogoni communities by enabling them to develop skills and expertise in carbon project development and monitoring.
ASIA PACIFIC
Bonds – Australia priced about A$7 bln ($4.7 bln) in green bonds Tuesday, maturing 2034, Bloomberg reports. Money raised from the green bond will go towards projects like green hydrogen hubs, community batteries and clean transport, as well as programs to conserve biodiversity, among others, the government said. However, some investors may be hesitant to buy the bond given Australia remains among the highest per-capita carbon emitters in the world and plans on developing new natural gas fields. Australia however is prohibiting the bond’s use on projects where fossil fuels may be involved. The Australian Office of Financial Management will issue the bonds on behalf of the Australian government, while the Treasury will remain responsible for annual allocation and impact reporting. Australia’s issuance adds to a record $294 bln worth of green bonds sold globally by governments and corporates this year, up 12% over the same period last year.
Platform – Australian freight logistics company Ofload has raised A$31 mln ($20 mln) from investors to start a carbon emissions tracking platform for clients’ fleets, the company said in a statement. The platform can measure emissions based on several different factors including the age of the vehicle, its route, and the time of day it travelled. The cash raising now values the company at A$350 mln, representing 200% growth in just under two years. The round was opened in December last year and was led by Yarra Capital Management, with other investors including King River Capital and Jungle Ventures, with all three firms on boarded with the new platform.
Added value – A court in Beijing’s Tongzhou district this week began hearing a case market participants hope will clarify once and for all tax issues related to domestic carbon credits, CCERs. The case involves Qinghai Chemical, who at an undisclosed date bought CCERs on the Beijing Green Exchange from sellers Environmental Protection Technology Co. and Low Carbon Technology Co. The deal was worth around 4.5 mln yuan ($621,500). Qinghai Chemical claims the sellers should issue a special value-added tax invoice, but the defendants say there is nothing in current legislation saying they have the obligation to do so. The exchange, too, rejects having any such obligation. The case is watched closely by market participants, as it will clarify how MVA and taxes related to CCER trading will be treated.
Cuts – New Zealand’s Ministry for the Environment is proposing to slash more than 300 jobs as part of wider public sector cost-cutting measures, Radio New Zealand reports. The Ministry said 303 roles would be gone by July next year, taking its headcount down to 700 from about 1,000. There will also be voluntary and proposed redundancies of permanent employees. It follows the coalition government’s budget handed down last week, which saw cuts to the public sector in order to fund tax cuts.
AMERICAS
Seeking relief – Oil and gas companies have petitioned the US Supreme Court to block dozens of lawsuits from state and local governments seeking to hold the industry liable for billions of dollars in climate change-related costs. The industry’s lawyers are asking the justices to decide the underlying question that affects all the pending cases: Does federal law and the Clean Air Act override or preempt states and their courts from punishing the oil industry for the harm caused by greenhouse gases? Over the last four years, the Court has turned away procedural appeals from the oil and gas industry seeking to transfer the cases from state to federal courts. If the Court votes to hear the cases, the justices would hear arguments this fall. (Los Angeles Times)
Kid safe climate – A group of Canadian youth revised a lawsuit Friday that claims the national government is interfering with their right to safe climate. In Dec. 2023, the Federal Court of Appeals unanimously ruled that courts should be allowed to determine whether the country is failing to provide its residents with a healthy environment. The amended filing by young residents in La Rose v. His Majesty the King argues that the government’s action, or sometimes inaction, violates human rights under the Canadian Charter of Rights and Freedoms.
VOLUNTARY
Capturing biogenic carbon – Capsol Technologies has announced the installation of one of its mobile carbon capture demonstration units at Vaxjo Energi’s (VEAB) Sandvik biomass plant in Vaxjo, Sweden. The unit, branded CapsolGo, will commence operations in June under a rental agreement with partner Sumitomo SHI FW. A full-scale plant could reduce emissions by about 260,000 tonnes of CO2 each year, starting in 2028, Capsol said. The resulting carbon capture would be classed as carbon removals as installed at a biomass plant with biogenic emissions.
Better together – Riverse, a certifier of industrial greentech projects, has partnered with Patch in what it says will democratise access to the widest network of high-integrity carbon credits within the industrial and circular economy sectors. More than 10 projects certified by Riverse are now available on the Patch platform, including biochar, IT, and construction projects.
Connecting on carbon – Tide has partnered with carbon measurement company Connect Earth to develop a range of carbon accounting tools that will help its SME customers reduce their carbon footprint. Small businesses currently account for half of the UK’s business GHG emissions and around 90% of them say they face barriers to taking climate action. Tide will roll out free access to to the first batch of its 600,000 UK members to Connect Earth’s carbon dashboard, Connect Insights. This dashboard offers a user-friendly platform to increase awareness and understanding of sustainability practices and provides carbon data estimates for every business transaction. The two partners plan to add further tools like automated carbon accounting for bank transactions, invoices, and accounting data, more insights and recommendations, and ways to enhance business efficiency.
AND FINALLY…
Brazilian flooding fault – Climate change made historic flooding in Rio Grande do Sul in late April and early May more than twice as likely and 6-9% more intense, according to research published Monday by the World Weather Attribution. The floods displaced more than half a million people, led to over 150,000 being injured, and, as of May 29, 169 fatalities and 44 cases people still missing, according to the report. It also disrupted basic services, like power, phone, and internet service, across dozens of municipalities in the state. The historic rainfall was determined to be extremely rare, with a return period of 100-250 years. In particular, deforestation driven by agricultural activity has increased flooding risk in the state, the report read.
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