CP Daily: Tuesday February 14, 2017

Published 22:56 on February 14, 2017  /  Last updated at 22:59 on February 14, 2017  /  Newsletter  /  No Comments

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

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EU ETS reform: A guide to the European Parliament vote

The 751-strong EU Parliament is due to vote in Strasbourg on Wednesday on a post-2020 ETS revision bill that is set to substantially scale up ambition from the European Commission’s proposal.

Advisors back cap-and-trade extension for California

California’s Legislative Analyst’s Office (LAO) has recommended the state legislature authorise its cap-and-trade programme to continue after 2020, although with certain changes such as a stronger price ceiling and less strict guidelines on how to spend auction revenues.

EU Market: Short-covering helps EUAs recover previous day’s losses ahead of key vote

European carbon prices jumped in late trade on Tuesday as short-sellers covered positions ahead of tomorrow’s key European Parliament vote.

NZ Market: NZUs climb to 3-month high as demand returns

New Zealand carbon allowances on Tuesday rose to their highest level since November as the market slowly returns from its holiday slumber and the government reaffirmed its intention to tighten up the emissions trading scheme.

China’s Gansu province seeks to get foot in carbon trading door

China’s northwestern Gansu province has released a raft of climate policies and ambitions to underpin a bid to host trading in the national carbon market, which opens later this year.

COMMENT: Should the UK stay or should it go? The consequences of a divorce with the EU ETS

As the UK prepares for Brexit, its future participation in the EU ETS is unclear. At least one MEP doesn’t think the country has a future in the market, while the British government says the issue is still part of ongoing negotiations. What alternatives does the UK have? Researchers at LSE’s Grantham Research Institute on Climate Change and the Environment outline a few of them.

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**Argus Emissions Markets 2017: Prague, Feb. 28-Mar.2 – Join Ian Duncan, Rapporteur of the EU ETS and MEP, the European Commission, CEZ, Commerzbank, BP, SinoCarbon and other industry leaders, compliance buyers, global experts, regulators and market facilitators in a discussion on the development of emissions trading systems and climate finance. Visit the website**

** Navigating the American Carbon World (NACW) 2017: San Francisco, Apr. 19-21 – NACW brings together the most active and influential players in North American climate policy and carbon markets to address the most pressing topics in domestic and international policy, subnational leadership, carbon markets, climate finance, and carbon management initiatives. Visit the website**

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Special relations – The UK government is seeking to convince Donald Trump to support the landmark Paris climate, Bloomberg reports, with officials touting the economic benefits of clean energy while steering clear of the debate about climate science, according to a person familiar with the discussions.

Meanwhile in Trumpland – US Senate Majority Leader Mitch McConnell is teeing up votes on Trump nominees as Republicans try to end a Democratic slow walk of the president’s picks, The Hill reports.  Votes are expected to be held in the next week over Scott Pruitt to lead the Environmental Protection Agency, Ryan Zinke to be the Interior Secretary, Rick Perry to be Energy Secretary.  But Senate Democrats are urging Republican leadership to delay an imminent floor vote on Oklahoma Attorney General Pruitt’s nomination, saying senators should wait until after an Oklahoma court holds an “emergency” hearing on a suit seeking documents from his tenure as AG, InsideEPA reports ($). Separately, Trump is reported to be planning to visit EPA headquarters to sign executive orders aimed at scaling back the agency’s climate change and other work, but is waiting until after the expected confirmation and swearing in of agency Administrator-nominee Scott Pruitt, an administration source told InsideEPA ($).

Brexit and beyond – While the first option for Britain should be to stay in the EU ETS and agitate to improve it, aligning with China, Canada and California might be among alternatives if the UK leaves. That’s according to a cross-party committee of the UK’s non-elected upper legislature seeking to influence the process. (Bloomberg)

EU cargo flexes its BICEPS – European cargo companies want shipping covered under the EU ETS, and a letter from the BICEPS Network of companies in the industry is urging MEPs to support the measure, which was adopted in December by the parliament’s environment committee, when they vote on it on Wednesday.  The organisation has also written to the presidents of the European Commission and Malta, which holds the rotating presidency of the EU, asking to be governed by the system.

Droppin’ like it’s hot – The US EPA published its 606-page draft 2015 GHG inventory for submission to the UNFCCC on Tuesday, reporting that the country emitted 6.219 bilion tonnes of CO2e that year, marking a 2.2% year-on-year drop and equivalent to 11% below 2005 levels – the US’ established baseline year.  The agency notes that the fall was driven in large part by a decrease in CO2 emissions from fossil fuel combustion, mainly linked to coal-to-gas switching, a slight drop in power demand and warmer winter temperatures in Q1 2015.

Ex-post it! – Setting emission caps for China’s planned national carbon market is difficult due to the rapid and unpredictable economic growth rate. However, by using ex-post adjustments, the cost of cutting emissions can be reduced and the influence of uncertainties minimised, researchers found in a new article published in Climate Policy.

Mittal’s not perfect – Steel magnate Lakshmi Mittal’s preference for an EU border tariff is not perfect but good enough, say Oxford University academics Dieter Helm and Cameron Hepburn in a letter responding to Mittal’s op-ed in the Financial Times. They say that it could be made less complex by focusing on the few big emitting sectors and taxing upstream to approximate emission levels.  Only applying it to those nations without a carbon price would also incentivise the expansion of these policies worldwide.

Indonesia top JCM host country – An energy conservation project in west Java in Indonesia using technology provided by Toyota Tsusho Corp. has been registered under the Joint Crediting Mechanism (JCM). It is only the 16th project to be approved under the mechanism, but the seventh in Indonesia, which also hosts the first project ever to be issued JCM credits. Japan has signed JCM partnerships with 17 countries, with the Philippines the latest to join last month.

And finally… Get your skis shined up – In an attempt to save their national pastime of skiing from climate change, Norwegian researchers are developing a machine that simultaneously heats homes and produces snow. Read more from Climate Home.

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