CP Daily: Thursday September 14, 2017

Published 23:53 on September 14, 2017  /  Last updated at 23:36 on September 26, 2017  / Carbon Pulse /  Newsletters

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

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EU Market: EUAs crash back to earth after hitting new 20-mth high on 9% daily rise

European carbon tumbled on Thursday afternoon to end flat after a volatile session that saw prices leap nearly 9% to a new 20-month high on a surging energy complex and ETS reform talk progress.


ICE Futures Europe to continue auctioning UK’s EUAs amid Brexit fears

The British government will continue to use ICE Futures Europe to auction EU carbon allowances after renewing its agreement with the London-based exchange operator, Carbon Pulse has learned.

EU energy trader group EFET urges lawmakers to rethink ETS Brexit-proof plan

An EU plan to safeguard its carbon market against an uncoordinated UK exit creates considerable contractual and trading risks and should be rethought, European energy traders group EFET said Thursday.

French court jails 12 carbon fraudsters, with 36 more to face trial

A Paris court on Wednesday sentenced 12 people to prison for their part in a €146-million tax fraud and money laundering ring that profited through the EU carbon market, while a related €385-million case involving 36 people advanced in the south of France.


Companies need 3-5 years to bed in climate risk disclosures, laws ultimately needed -FSB Task Force

Companies will need three-to-five years to refine how they disclose their climate risks in their mainstream financial reporting, but the voluntary practice will eventually need to be made mandatory, according to a key advisor to the Task Force on Climate-Related Financial Disclosures (TCFD).


Australia PM pulled both ways on clean energy, carbon price

Australia’s ex-Prime Minister Tony Abbott on Thursday piled more pressure on current PM Malcolm Turnbull to move away from a clean energy target to more coal, as yet another mining firm came out in favour of carbon pricing.

NZ Market: NZUs soften as election outcome becomes hard to call

New Zealand carbon permits closed slightly weaker on Thursday as next week’s hard-to-call election has injected some caution into the market.


NA Markets: Prices drift on thin interest despite strong Ontario auction

Prices for carbon permits on North America’s east and west coasts drifted this week as the impact of the recent auctions faded.


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Compliance check – The states participating in the RGGI third control period (2015-2017) today released materials for CO2 budget source compliance and will hold a compliance webinar for CO2 budget sources on Oct 3. Each RGGI budget source must provide allowances equal to 50% of their emissions over the period for its first two years and 100% of their remaining emissions at the end of the period’s third year (11.59pm Mar. 1 2018).

Still going for it – German Chancellor Angela Merkel said her government was still committed to reaching the country’s 2020 target to reduce emissions by 40% despite GHG emissions in Germany having increased. Asked if she thinks the government would succeed, Merkel said: “I’m working on making it happen, yes. We have committed to it.” In German broadcaster ARD’s town hall election campaign TV show, the chancellor added: “There’s still a lot to be done. Because we have advanced the energy transition relatively fast, we have a situation in which we export a lot of lignite power, for example to Poland. It’s still produced cleaner than maybe in the country itself. But, anyway, emissions have increased.” European climate goals were “not the problem”, said Merkel. “We already reach them.” (Clean Energy Wire)

A different direction – Drax, formerly the UK’s largest coal-fired power station, could build one of the world’s largest batteries at 200 MW, and the UK’s largest gas plant at up to 3,600 MW, report the Times and others. The plans announced yesterday could see the site stop burning coal as soon as 2020, the Times adds. Half the coal units at Drax have already been converted to burn biomass, the Financial Times notes. The shift at Drax is in response to government plans to phase out unabated coal by 2025, it says, noting that “the economics of large gas plants were called into question this week by the results of the government’s latest energy subsidy auction…[with offshore wind] cheaper than power from…the forecast cost of…new large gas plants”. (Climate Brief)

No country for coal gen – Phasing out inefficient coal plants would save US consumers up to $10 billion annually by 2021, according to a new report from Carbon Tracker. Constructing CCGT gas plants would be more cost-effective by the mid-2020s than continuing to operate 78% of the nation’s current coal fleet, it found. Around 30 GW of coal capacity has been retired over the last three years, with coal generation declining by 13% over the same period. “The economics of US coal power could not be starker: new coal capacity is not remotely competitive, while in the next few years it will be the exception rather than the rule for the operating cost of existing coal to be lower than the levelized cost of new gas and renewables.”

Mixed messages – US House Republicans overwhelmingly endorsed two attacks on Obama-era climate policies on the floor yesterday, Axios reports. The chamber passed a pair of amendments to a major spending package that would thwart funding for EPA regulation of methane from oil-and-gas operations, and block regulatory use of the Obama administration’s tally of the social cost of carbon.  And handful of Republicans crossed the aisle to vote with nearly all Democrats on the measures. “The largely symbolic votes come two months after a much wider group of House Republicans – 46 to be exact – sided with Democrats to maintain a provision in defense programs legislation that calls climate change a ‘direct threat’ to national security and requires new Defense Department analysis of its effect on the military,” Axios noted. Yesterday’s votes, which GOP leadership did not whip, show that despite signs of growing interest among some Republicans in preparing for and addressing climate change, there remains much less appetite in the party for climate regulations.

Up, but only a little – India’s greenhouse gas emissions have increased 1.8% in the first eight months of 2017, a considerably slower rate than usual, according to a blog post by CICERO researcher Robbie Andrew. The slowing economy, which has led to a decline in coal consumption, appears to be the main reason, although indications are that emissions growth will speed up again in the remainder of the year.

Big changes in the Big Apple – New York City Mayor Bill de Blasio on Thursday announced plans to force thousands of ageing buildings there to become more energy efficient, The Washington Post reported, a first-of-its-kind initiative intended to make the Big Apple a national leader in reducing GHG emissions. The initiative would mandate that owners of existing buildings larger than 25,000 square feet invest in more efficient heating and cooling systems, insulation and hot water heaters in the years ahead. If approved by the City Council, the requirements would apply to about 14,500 private and municipal buildings, which the mayor’s office says collectively account for nearly a quarter of NYC’s emissions. Most buildings would need to comply with new efficiency targets by 2030 or their owners would face penalties.

And finally… On a quantifiable mission – After he and his family were displaced by Hurricane Irma, the head of the $1.4 billion Voloridge Investment Management – one of the world’s most successful hedge funds – has refocused efforts on his pet quantitative project: helping to prove that climate change is real and made by humans, and getting people to do something about it. (Bloomberg)

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