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Australia’s conservative Coalition government on Tuesday outlined its post-2020 energy policy plan, saying it would impose a low-carbon standard on utilities but ruling out a market-based approach.
China’s pilot emissions trading schemes have ignored energy and commodity fundamentals as regulatory intervention has been the chief price driver, highlighting a major challenge to turn the national cap-and-trade programme into an effective mechanism.
The incoming Dutch coalition government will set the country’s new carbon floor price at €18/tonne in 2020, media reported on Tuesday.
European carbon closed at its highest level in 21 months on Tuesday as prices were boosted by a strong auction and bullish fundamentals.
Governments have rejected a move by UN aviation agency ICAO to set non-binding goals for biofuel use by planes starting in 2025, with some arguing that there must first be agreement on what fuels are sustainable.
Korean CO2 allowances on Tuesday rose 0.7% to reach a seven-month high on rising expectation that allocation next year will be tightened once the environment ministry regains control of managing the scheme.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Cash climb – EU climate finance to developing countries amounted to €20.2 billion in 2016, with the EU Council saying the latest figure amounts to a significant increase on the previous year, though it did not give a like-for-like comparison. It demonstrates the gap to the $100 billion/year goal set for developed countries by 2020 and through until 2025. The contributions for mitigation and adaptation are from a wide variety of public and private sources including ETS auction revenue to each member state.
Solar scramble – The average price of new solar power installations in Germany has fallen below five cents/KWh for the first time ever. Since the introduction of auctions in 2015, prices have declined by more than 40%, prompting calls from the solar industry to remove all caps on its expansion. The issue is likely to become a bone of contention in upcoming coalition talks for Germany’s new government, which are scheduled to start this week. German Chancellor Angela Merkel told journalists that she expects talks over possibilities for a new government coalition to last several weeks before actual negotiations begin. (Clean Energy Wire)
The price is right – An “effective CO2 price” of about €30 per tonne across all sectors and in as many European countries as possible is indispensable for climate protection, according to consultancy Energy Brainpool, which analysed Germany’s aspiring government coalition parties’ manifestos on their energy policy positions. Also, sectoral integration will “lead demand away from burning fossil fuels to an optimised use of renewable energy”, while a more flexible composition of the power price allowed for more rapid electrification of energy markets. Moreover, a focus on digital processes can boost efficiency in the energy sector and European integration maximises the effect of these measures. (Clean Energy Wire)
The price is not right – The UK’s current carbon price won’t be enough to facilitate its planned coal generation phase-out, according to new analysis from Aurora Energy Research. The firm says the UK’s current carbon price of around £23/tonne (carbon price floor + EUAs) was responsible for almost 75% of the decline in coal generation since the price floor was introduced in 2013. But the government faces “a tough decision” on whether to cut, raise or keep frozen its carbon price in the upcoming Autumn Budget. (edie)
How to spend it – In 2016, $22 billion in public revenues were generated with carbon pricing initiatives, and two-thirds of this came from carbon taxes. On the use of these revenues, while each jurisdiction made clear choices, no trend emerges at the global level. Read more in I4CE’s 2017 global landscape of carbon prices.
Give nature a chance – Nature could cost-effectively deliver over a third (37%) of GHG reductions required by 2030 to prevent dangerous levels of global warming, according to a new study published today by scientists from The Nature Conservancy and 15 other institutions. This is equivalent to a complete stop on the burning of oil worldwide. The study found that natural climate solutions such as planting more trees, improving soil health, and protecting mangrove and peatlands could reduce global GHGs by 11.3 billion tonnes per year by 2030. The UK could cut its GHGs by 9% by implementing cost-effective reforestation in areas such as The Highlands and The Peak District, the equivalent to taking 10 million cars off the road. The scientists found that full implementation of reforestation measures would reduce emissions by 28.7%, the equivalent to taking 32.8 million cars off the road.
Pipe dreaming – The Trump administration approved Monday an extension to an oil sands pipeline across the Canadian border from North Dakota after the permit stalled for five years under former President Obama. The permit will allow Enbridge Energy’s Line 67 pipeline, also known as the Alberta Clipper Pipeline, to double its capacity at the border crossing to nearly 900,000 barrels per day. (Reuters)
And finally… The problem with Poland – The biggest US backer of Polish wind farms is accusing the east European nation of undermining its investment by deliberately depressing renewable energy prices and unlawfully terminating electricity supply contracts, Bloomberg reports. Invenergy LLC said that the government orchestrated the cancellation of long-term energy contracts that the Chicago-based company signed with state-controlled power utilities in 2010, adding that Warsaw’s, which caused $700 million in damages to Invenergy, were “tantamount to an expropriation” and violate a US-Poland bilateral investment agreement. The company said it will take the case to international arbitration if a settlement isn’t reached in six months. The clash comes as Poland has moved to the top of Europe’s political agenda amid the European Union’s first-ever investigation of a member state’s respect for the rule of law. The European Commission said last month that the ruling Law & Justice party’s attack on judicial independence has given foreign investors jitters about the credibility of the Polish legal system.
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