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TOP STORY
ANALYSIS: Open interest rises on EUA futures as analysts point to utility hedging, new compliance deadline, speculators
Aggregate open interest across all European carbon futures contracts has this year risen significantly above 2023 and 2022 levels, driven largely by stronger liquidity on the August and December 2024 contracts, as analysts point to a likely recovery in utility hedging, the shift in compliance deadline to September, and hedge fund interest as behind the trend.
EMEA
REPowerEU revenues from EUA auctions falling behind target amid EUA price slump
REPowerEU revenue has fallen more than €300 million behind the EU’s target after the first a year of sales under the initiative, raising the prospect that even more EUAs will need to be sold into the market to raise the €20 billion in funding that has been promised from the bloc’s carbon market to pay for the switch away from Russian energy supplies.
BRIEFING: EU to offer fast-track permitting for green industry frontrunners
The European Commission wants to speed up approval of emerging green and low-carbon technologies, saying it will promote faster permitting for those identified as the most promising by its new Innovation Centre for Industrial Transformation (INCITE) in Seville.
Italian authorities investigate CO2 emissions fraud at country’s largest steel plant -media
Ten individuals are being investigated by the Italian authorities for submitting manipulated CO2 emissions data while administering Italy’s largest steel factory, which then affected the facility’s EU carbon permit compliance requirements, according to multiple national media sources.
Ukraine business group urges govt to slow its ETS rollout and plan for CBAM, EU linkages
An influential business group in Ukraine has outlined its proposals for how best to roll out an ETS in the country, requesting a slower implementation to help affected sectors ready for eventual linkage with the EU market, and demanding that work on a domestic CBAM begins next year.
No end in sight for EU’s high energy prices under net zero plans -lobby
The EU will continue to endure markedly higher energy prices than the US and China even in a scenario where it meets its climate goals, due to its continued reliance on imports and growing demand, said the bloc’s business lobby.
Brussels pledges to do ‘whatever is necessary’ to support CCS
The European Commission will take all the necessary steps to make carbon capture and storage (CCS) technology available to large industrial emitters and remove barriers to its development, a senior EU official said on Wednesday.
Gambia introduces draft carbon trading bill
The government of Gambia has introduced a draft carbon trading bill in an effort to regulate project activity and credit transactions in the emerging market.
Euro Markets: Carbon edges lower after rangebound trading as activity thins with US holiday
EUAs weakened modestly as activity dwindled in the afternoon with the US market were closed for Independence Day, prices spending much of the day see-sawing in a well-defined range, while UKAs rose late in the day as the country voted in a general election.
VOLUNTARY
INTERVIEW: Momentum for LPG cookstoves fuelled by health, emissions impact
Carbon finance can accelerate the adoption of cleaner cooking with LPG in developing countries, with a number of credit-generating projects underway, though infrastructure rollout remains a core challenge, say experts.
Voluntary carbon trading platform pushes back auction of 1.5 mln Article 6 credits from Malawi cookstoves
A voluntary carbon trading platform has delayed its sale to July 16 of 1.5 million Internationally Transferred Mitigation Outcomes (ITMOs) at a minimum of $10 each generated by clean cooking projects in Malawi, according to a Wednesday press release.
Carbon removals platform updates fee structure to open door to fresh supply
A voluntary carbon crediting platform for engineered removals has unveiled plans to update its service fee structure later this year to make market entry more accessible for carbon removal suppliers, it said this week.
Lego pushes suppliers to quickly cut their emissions
Danish toy maker Lego Group is putting pressure on its suppliers to cut emissions in the next two years, as part of its efforts to reach net zero emissions by 2050.
ASIA PACIFIC
Taiwan carbon exchange likely to see first domestic offset transaction in September
A government-backed carbon exchange in Taiwan is likely to see the first transaction of domestically issued emissions reductions by late September or early October, according to local media reports.
Palm oil land speculation major driver of Indonesian deforestation, satellite study finds
Speculation and land banking by the palm oil industry is a major contributor to Indonesia’s massive historical deforestation rates, according to a study published this week.
Australia confirms GHG reporting rule changes that think tank says could cover up millions of tonnes of coal mine emissions
Australia has announced updates to national emissions reporting rules that a climate think tank warns will let coal companies dramatically under-report their emissions and undeservedly be issued Safeguard Mechanism Credits (SMCs).
Japan considers government procurement of DAC carbon credits, draft methodologies for project development
Japan is considering government procurement of direct air capture (DAC) carbon credits in a bid to boost demand, while several relevant methodologies under the domestic offset programme are being developed.
AMERICAS
Washington Clean Fuel Standard cumulative surplus nears 1 mln through 2023
The net credit surplus in Washington’s Clean Fuel Standard (WCFS) soared towards the 1-million mark in the fourth quarter of 2023, with growth in electricity surpassing ethanol crediting, accompanied by declines in gasoline and diesel volumes, state data showed.
Quebec government advisory committee calls for cap-and-trade changes to increase cost of carbon
The cost of a carbon allowance in Quebec’s carbon market is too low to limit global temperature increase to 2C, a government advisory committee said in a report published Wednesday, as they called for revisions to the province’s cap-and-trade programme to encourage further emissions reductions and increase the cost of carbon.
AVIATION/SHIPPING
American Airlines looks to SAF first for CORSIA compliance, British Airways to raise prices to cover CO2 costs
American Airlines will prioritise sustainable aviation fuel (SAF) to fulfill its obligations under UN’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) but also expects to use carbon offsets, according to its 2023 sustainability report, while the Financial Times (FT) reported Wednesday that British Airways will raise its prices to cover the cost of reducing its CO2 emissions.
BIODIVERSITY (FREE TO READ)
International panel releases survey results on biodiversity credit market models
Many companies believe mandatory offsetting requirements would be critical for the biodiversity market to scale, according to submissions to the International Advisory Panel on Biodiversity Credits’ (IAPB) second round of consultation with market participants.
UK developer hopes to sell biodiversity credits worth over $14 mln within months
Biodiversity credits worth over $14 million in total across two projects could be sold within the next three months to multiple-buyer groups, according to the head of credit developer RePlanet.
French nature tech startup to develop ESA-funded biodiversity monitoring tool
A French nature tech startup has secured undisclosed funding from the European Space Agency (ESA) to develop a biodiversity monitoring tool for potential use in nature-related disclosures and the biodiversity credit market, Carbon Pulse has learned.
Restoring 11 key EU rivers can help achieve 10% of freshwater biodiversity target, WWF says
Restoring key EU rivers can help achieve 10% of the bloc’s biodiversity targets under the Nature Restoration Law while strengthening countries’ resilience to the climate crisis, a new report has shown.
Nature framework for investors launches with three target types
The Finance for Biodiversity Foundation (FfB) launched the second edition of its nature target-setting framework for asset managers and owners on Wednesday with three target types.
Biodiversity Pulse: Thursday July 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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MARKETPLACE LAUNCH
Supercritical launches a world-first in carbon removal: a multi-pathway marketplace with live pricing and availability data for 80% of the biochar market. This launch brings radical transparency to a traditionally opaque market. Underpinned by a rigorous 118-point vetting process, the marketplace ensures quality across biochar and other removal pathways. Real-time data empowers buyers to make informed decisions and transact effectively. Trusted by 1/3 of all corporate buyers, including The Economist Group and Virgin Atlantic, Supercritical is redefining carbon removal procurement. For companies committed to climate action, Supercritical offers a single place to navigate the carbon removal market. FIND OUT MORE
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CONFERENCES
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
Labour landslide – Britain welcomes a new party in power after 14 years of Conservative rule. Sir Keir Starmer’s Labour party is headed for a huge majority of about 170 seats in the House of Commons after PM Rishi Sunak conceded defeat in the UK general election. With the final results still streaming in, a national exit poll suggests Starmer will become prime minister with 410 out of 650 Commons seats, with the Tories holding 131 seats, the party’s worst result in its 190-year history. Most Conservative cabinet ministers lost their seats but Sunak won his, and said he took “responsibility for the loss”. A victorious Starmer had earlier declared: “The change begins right here. It’s now time for us to deliver”. As of 0500 GMT, Labour had won 389 – well above the 326 required for a majority. The Tories will remain the official opposition, but were on 98 seats compared to the Lib Dems at 56. Reform has won at least four, and the Greens three. Brexiteer and far-right Reform Party leader Nigel Farage won his first seat in a general election on his eighth attempt. Read Carbon Pulse’s election preview: Five climate policy changes expected under a UK Labour government, and Data Dive: The impact on climate of 14 years of Conservative rule in Britain. (FT)
Serbia’s CO2 – Serbia is working to assess the most acceptable option for taxing CO2 in light of the EU’s Carbon Border Adjustment Mechanism (CBAM), where importers of goods from certain industrial sectors into the bloc will be charged a tax from 2026 related to their GHG emissions arising from production. Serbia’s Minister of Mining and Energy Dubravka Dedovic Handanovic said that one of the more acceptable options is to tax CO2 on the national level as such a system, with a fixed price, would secure predictability for companies in their adaptation period. Another consideration is to form a Western Balkans regional just transition fund that the EU would support. Serbia’s amendments to the Law on Energy will be adopted by the end of the year, setting the regulatory conditions for integrating with the single European electricity market. The country also belongs to a regional energy exchange with EU members Hungary and Slovenia.
Origin of the energies – EEX and IncubEx will launch a new suite of Guarantees of Origin (GO) futures contracts on Sep. 2, they said Thursday. EEX will list four new GO contracts: EEX European Renewable Power GO Future (any technology GOs: Hydro/Wind/Solar/Biomass); EEX European Hydro GO Future; EEX European Wind GO Future; EEX European Solar GO Future. GOs provide tracking of origins of renewable energy within the EU and help facilitate investment into renewable energy projects. The verified certificates, each representing 1 MWh from renewable energy sources, can be traded and used across Europe.
Emissions fraud – Allegations of fraudulent emission reduction projects in China used by fossil fuel giants like Shell and TotalEnergies to fulfil climate protection requirements in Germany have led German environment minister Steffi Lemke to demand clarification from the Federal Environment Agency (UBA). The body is currently examining 40 out of a total of 69 projects that it approved in China and that had been validated and verified by German inspection bodies, but were possibly based on false information. Public broadcaster ZDF claims that more than a quarter of the so-called upstream emission reduction projects (UER) are fake, and estimates the value of the allegedly fraudulent schemes at over €600 mln. Oil companies can use UER certificates to meet GHG reduction quotas in Germany by reducing CO2 emissions during oil production.
EUA shopping for shipping – A new digital service for shipping companies is designed to streamline the process of purchasing allowances on the EU ETS, as the sector prepares to begin trading on the market next year, SeatradeMaritime reported. The service was created by Zero44, a two-year-old Berlin-based software company that aims to help the maritime industry decarbonise. Shipping was added to the EU ETS this year and companies will have to surrender their first batch of EUAs by Sep. 2025, for 2024 emissions. The software covers all of the processes required by the ETS, including emissions measurements, cost calculations, and execution and controlling of ETS clauses from charter and ship management contracts. Companies will be able to choose a preferred trading partner and purchase EUAs through that trader. The first companies to trade through the Zero44 platform are: ACT Group, AFS Group, Aither, Berenberg, Carlton Carbon, CFP Energy, Grey Epoch, and Targray.
Power in Angola – Commodities company Trafigura and engineering company ProMarks have signed a memorandum of understanding with the Angolan government to assess the technical and economic viability of a regional power transmission and supply project in the country, they announced on Thursday. The project is to build a 2,000-megawatt high-voltage interconnector to carry surplus renewable power from hydroelectric dams in the north of Angola to the Democratic Republic of Congo Copperbelt and Zambia, integrating with the Southern Africa Power Pool. The renewable power would be purchased from Angola’s National Electricity Transmission Network, and the energy would be sold to customers such as mining companies in the Copperbelt. The new joint venture between Trafigura and ProMarks would develop, finance, build, and operate the interconnector, using equity capital and third-party debt. Planning, approvals, and construction would take about four years after the final investment decision.
High emitters – High-income households in Germany emit twice as much CO2 as their low-income counterparts primarily due to their travel habits, a report by the German Institute for Economic Research (DIW) has found. “A single long-haul flight causes more emissions per capita than housing and food-related emissions in an entire year combined,” said Sandra Bohmann, co-author of the report. At 6.5 tonnes per capita per year, carbon emissions in residential energy use, nutrition, and transport are twice as high as required to achieve the target specified in the Paris climate agreement, it found. The report calls for energy-efficient building retrofits, banning short-haul flights, and promoting sustainable eating habits in a bit to achieve the 2045 carbon neutrality goal.
CBAM support – CarbonChain has released new updates to help metals and energy leaders stay on top of demand for carbon emissions disclosure across Scope 1-3 and report in line with the EU’s Carbon Border Adjustment Mechanism (CBAM). The updates include a free tool to measure, track, and submit data for CBAM, as well as automated supplier engagement and enhanced product carbon footprinting. The self-service end-to-end CBAM declaration offering is free to access for eligible companies until Oct. 2024.
ASIA PACIFIC
Transition phase – Bhutan’s Dagachhu Hydropower Project has traded 781,653 carbon emission reduction credits (CERs), generating $7.77 mln in revenue between 2015 and 2023, the government announced this week. The Himalayan nation has registered three hydropower projects under the Clean Development Mechanism (CDM) out of which only the Dagachhu project has participated in carbon trading thus far. Further, Druk Holding and Investments (DHI), the commercial arm of Bhutanese government is exploring carbon trading opportunities and is currently collaborating with Singapore to facilitate Bhutan’s entry into the carbon market, Business Bhutan reported. As of now, the country has no projects under Article 6 of the Paris Agreement yet, but has begun the transition of its registered CDM projects.
Save the sloths – Environmentalists have written to the India’s environment ministry to stop the construction of a proposed 1600 MW coal-based thermal power plant in Mirzapur in the state of Uttar Pradesh by the Adani Group. The area is part of a proposed Sloth Bear Conservation Reserve and is a habitat for rich and threatened wildlife of the Vindhyan-Kaimoor ecosystem. The industrial conglomerate has claimed that the project site is not forest land, which contradicts claims of previous forest officers that the area in question is a part of the land transferred to the state forest department, making it a ‘Recorded Forest’ land, according to Debadiyo Sinha, a climate expert. The same site was earlier proposed for Welspun Energy’s 1320-MW plant but was cancelled by the country’s National Green Tribunal (NGT).
Three to tango – US-based NetZero Global, has partnered with Hydrogen Refinery and Maharlika Carbon to address the critical issues of waste management, energy security, and decarbonisation in the Philippines. Under the partnership, the entities will use British military technology to convert municipal, agricultural, and industrial waste into clean hydrogen fuel and other low-carbon transition fuels. Other than green hydrogen production and regenerative waste management, the partnership will focus on enhancing the Philippines’ energy independence by reducing reliance on imported fossil fuels, creating jobs, stimulating the local economy, and supporting the Southeast Asian country in meeting its Nationally Determined Contribution (NDC) under the Paris Agreement, a press statement said.
Municipal awakening – The Thiruvananthapuram city corporation in the Indian state of Kerala, is set to explore the concept of carbon credit trading with an aim to reduce the city’s carbon footprint, promote sustainable development, and generate revenue by trading credits, the New Indian Express reported. The civic body will soon invite Expressions of Interest (EoI) for implementing the initiative and is encouraging innovative ideas to reduce carbon footprints across sectors, including public transportation, construction, agriculture, and waste management.
Sourcing materials – IKEA’s parent company, Ingka Investments, has acquired some 23,500 hectares of farmland to convert to forestry and existing forestry blocks since Aug. 2021, Radio NZ reported. Data from the Overseas Investment Office shows the company has been given approval for 25 sales in New Zealand, while one application is awaiting a decision. Existing forestry blocks cover 4,290 ha, while 19,205 ha of farmland has been bought to turn into rotational pine forests. An Ingka Investments spokesperson told the outlet that while the company did not have a specific land acquisition target, it did intend to make further investments. The spokesperson emphasised that the forests were not part of the country’s Emissions Trading Scheme, and it had no intention of generating and selling carbon credits in the future.
Coral project – The soft drinks arm of Japanese beverage maker Asahi Group has teamed up with Irabujima Environmental Association to kick off a coral transplantation project using CO2 collected from ‘CO2-eating vending machines’ in Okinawa prefecture in early July, in order to promote coral reef conservation activities, according to a company statement. Asahi Soft Drinks has implemented a number of special vending machines containing a powder-like material made from calcium compounds to absorb CO2 across the country. Under the project, the base for the coral transplantation will be made of carbon-negative concrete, and the use of Asahi’s CO2-absorbent material is expected to further support coral growth.
AMERICAS
By any means – The government of Saskatchewan has filed for an injunction to prevent the federal government from collecting its missed carbon tax payments, the Canadian Press and the Regina Leader-Post reported Thursday. Provincial Justice Minister Bronwyn Eyre said the Canada Revenue Agency’s efforts to audit Saskatchewan this spring are “unconstitutional”. In withholding payment of the federal carbon price, Saskatchewan has broken federal emissions law, from which the province may be responsible for payment or fines or potential jail time for the responsible minister.
Canadian CCS continued – Canadian Natural Resources Minister Jonathan Wilkinson said this week that he expects 20-25 commercial-scale CCS projects to break ground in the country in the next decade. The federal government recently passed guidance for CCUS tax credits, which Wilkson said was important in oil major Shell’s Canadian subsidiary reaching a final decision to invest in two CCS projects in Alberta. So far, Canada only has a handful of CCS projects in operation, but there are currently more than 40 individual carbon capture and storage projects proposed by companies in Canada, according to an International Energy Agency database. (Canadian Press)
Provincial CCS continued – Nonprofit industrial solutions hub Carbon Management Canada will receive almost C$1.2 mln ($881,300) in funding from PrairiesCan, Canada’s economic development arm for the prairies, the federal government announced Thursday. The funding will enhance the firm’s emissions management technology validation facility, where small- and medium-sized businesses can test, refine, and commercialize carbon capture products and technologies.
Brazil green hydrogen law – The Brazilian Senate approved on Wednesday a law establishing a national green hydrogen framework. Accepted amendments included those to expand the definition of green hydrogen to inclusion that created by all renewable energies and set limits on tax credits. The bill will now return to the Chamber of Deputies, where it originated, for continued consideration.
VOLUNTARY
Advise the advisors – Carbon ratings agency BeZero Carbon has announced its new advisory board, brought together to provide independent advice and guidance. Members include Rhian-Mari Thomas, chief executive of the Green Finance Institute and a senior adviser to the Taskforce on Nature-related Financial Disclosures. She currently chairs the National Wealth Fund Taskforce for the UK Labour Party. Cameron Hepburn, of the University of Oxford, also joins. He was a former adviser to a UK Secretary of State for Energy and Climate Change and is part of the Academic Panel within the Departments for Environment, Food and Rural Affairs, and of Energy and Climate Change. Pernille Holtedahl, research fellow at Imperial College London’s Centre for Climate Finance and Investment, and a current senior consultant at S&P Global, will form part of the group. Alicia Seiger also joins, who is Managing Director of the Sustainable Finance Initiative out of the Standard Doerr School of Sustainability, and a lecturer at Stanford Law School. Finally, Laura-Marie Topfer, currently serving as the Chief Sustainability Officer and Sustainability Area Leader for Western Europe at Microsoft, completes the lineup.
Nepalese cooking – Project developer Imperative has launched a clean cooking project in Nepal that will target a new high-quality benchmark for improved biomass cookstove projects, following some of the recent criticism levelled against the market, according to a LinkedIn post. No further details were given. In a bid to lend credibility to the cookstove sector and boost investor confidence, the Clean Cooking & Climate Consortium (4C), led by the Clean Cooking Alliance (CCA), recently released a new methodology for crediting emissions reductions from cooking projects. It’s intended to apply to all clean cooking projects, including under Article 6 of the Paris Agreement.
Cement CO2 – Verra has published a new methodology applicable to the production of low-carbon cement that displaces traditional Portland cement in concrete. Verified Carbon Standard (VCS) Methodology Revision VMR0012 Production of Geopolymer Cement, v1.0 is a revision to the CDM methodology AM0125: Production of geopolymer cement, v1.1. However, it strengthens its integrity by inserting a discount factor for upstream emission reductions that result from reduced use of virgin materials. The update will enable a wider range of cement projects to generate carbon credits, said Verra.
Greener farming – Agricultural technology company Dimitra has launched Dimitra Carbon, a new initiative aiming to supply high-quality carbon credits generated from sustainable agriculture and traceable on blockchain. Every credit will be traceable back to its origin at the farmer level, makes the carbon market accessible to approximately 500 mln small-scale farmers worldwide, said Dimitra. The first projects under the initiative are already underway in Africa.
SCIENCE & TECH
Questioning Amazon – Claims by Amazon Web Services (AWS) that it can almost eliminate AI emissions by moving clients’ workloads from on-premises infrastructure to its data centres have been questioned by cloud experts, who say that claims of a 99% reduction in carbon footprint are based on a best-case, optimised scenario. A recent report by AWS and Accenture says that when AI workloads are optimized on AWS, the associated carbon footprint can be reduced by up to 99%. Critics of cloud greenwashing say that measuring emissions ‘in totality’ is not easy to do and they also point to a reliance on carbon offsets, in addition to rising carbon emissions from cloud providers due to the AI boom. (The Stack)
AND FINALLY…
Fake weather – Social media users have been wrongly blaming the UK’s erratic weather on manipulation and geoengineering and accusing weather presenters of hiding the truth, BBC Verify reported. The country saw temperatures around 2C lower than average for much of June, and even a short heatwave at the end of the month was still 0.4C colder than average. This came after one of Britains’ wettest winters in recent years. For some on social media, the recent cool spell suggests that climate change may not be real and is fuelling a theory that the government is controlling both the weather and climate. Mentions of #GeoEngineering on X, for example, more than doubled worldwide between the last six months of 2023 and first half of 2024. The thousands of tweets often lump together different processes, such as weather modification – such as cloud seeding – and geoengineering. The UK’s Met Office has said it is not aware of any weather modification activities in the country in recent years.
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