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RGGI’s final quarterly auction of 2017 cleared at $3.80/short ton, retreating from the last sale’s 4.5-year high as market participants showed less interest amid a sharp drop in the power-only scheme’s emissions this year and as the end of the current compliance phase nears.
EU carbon prices slipped to their lowest in five weeks on Friday as another weak auction and technical support breach knocked sentiment in a jittery market approaching major contract deliveries.
The UK government has opened a consultation on the agreed amendments to the aviation EU ETS, measures it forecasts could carry a net cost of as much as £945 million to carriers, government, and society.
Offset issuance in Australia has slid to a near-halt so far this month as this week’s Emissions Reduction Fund (ERF) auction has taken centre stage.
Below is a table of the closing prices, ranges and volumes for China’s regional pilot carbon markets this week. All prices are in RMB, and volumes in tonnes of CO2e. Data sourced from local exchanges.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Brexit booster – The UK and EU struck a deal a deal on Britain’s divorce bill and immediate responsibilities, opening the way for talks to begin about the nature of the post-Brexit future. Progress in the overall Brexit negotiations increases the chances that the UK can achieve its aim of striking a two-year implementation phase that would effectively maintain its EU relationships for around two years after its EU exit day of Mar. 29 2019. This implementation phase would keep UK emitters in the EU ETS throughout the current trading phase until end-2020. Beyond that, the UK is still exploring all options with no stated preference. (Bloomberg)
Replacement coming – US EPA boss Scott Pruitt on Thursday said his agency planned to propose a replacement for the Obama-era Clean Power Plan, after previously only committing to consider replacing the regulations that are in the process of being repealed. He said the EPA could launch its public “red team, blue team” debate about climate change as soon as January, which is aimed at giving the public a “real-time review of questions and answers around this issue of CO2.” Pruitt also criticised the process that led to the EPA’s 2009 endangerment finding, but did not commit to attempting to revisit the rule, at least for now. (Reuters)
Shipping off – A declaration to align shipping emissions with the goals of the Paris Agreement is set to pressure the industry on the sidelines of the high level OnePlanet summit in Paris next week. It will call on the sector to do its bit to hold temperature rises “well below 2C” and aim for 1.5C, according to a copy of the statement. That means peaking emissions “in the short term” and reaching carbon neutrality “towards the second half of this century”. The language is significantly stronger than the “aspirational” targets proposed by industry groups ahead of UN shipping agency IMO’s April meeting tasked with producing an initial climate strategy for shipping. (Climate Home)
Lignite of the living dead – Over half of the EU’s 619 coal power plants are losing money, according to a report by environmental think-tank Carbon Tracker. It said higher carbon prices and stricter air pollution rules will push even more stations to financial losses, and the industry’s slow plans for shutdowns will lead to €22bn in losses by 2030 if the EU fulfils its climate target. The falling costs of renewables are on track to make building new solar and wind farms cheaper than running existing coal power stations, by 2020. Nearly all European coal-fired plants will be loss-making by 2030, leaving utilities will little option but to rely on government support or abandon the assets.
Best buddies – Coal magnate Bob Murray met with US Energy Secretary Rick Perry in March, where he pitched an “action plan” to save the coal industry, In These Times reported. Photos of the previously unreported meeting, which depict Perry embracing Murray and the secretary reviewing the proposal from Murray Energy, come days before the Federal Energy Regulatory Commission may decide on a rule proposed by the DOE that would bail out the coal and nuclear industries. The narrowly-written proposal would benefit Murray Energy in particular, providing a potential windfall for the company. While Murray Energy spokespeople have acknowledged the company has “a vital and critical interest in the outcome” of the rule, Murray told Greenwire last week that he “had nothing to do” with Perry’s proposal. FERC was supposed to rule on the proposal on Monday, but the agency’s new chairman, Kevin McIntyre, asked DOE for a 30-day extension on the decision in a letter sent late Thursday. (Climate Nexus)
Miga offering – Helena Wright of environmental think-tank E3G profiles the Multilateral Investment Guarantee Agency (MIGA), which she says is one World Bank institution which has hardly made any progress on greening its finance or investing in clean energy. It has the mission of promoting foreign investment by providing guarantees to protect investors against non-commercial risks such as political risks. But none of the guarantees supported by MIGA in 2016 went to solar, wind or geothermal energy. (Climate Home)
Another lawsuit – The UK arm of a US-based lawfirm is being sued by an investment fund manager over claims of fraudulent misrepresentation and breach of fiduciary duty. The claimant, David Gorton, alleges that two former McDermott Will & Emery London lawyers advised him to invest in carbon credit trading schemes in which they had undisclosed personal financial interests. The claim states that they provided tax advice to Gorton in 2005, and advised him to invest in a series of LLPs that created and traded carbon credits and were managed by Carbon Capital Limited (CCL). Gorton invested £38 mln ($51.2 mln) in five LLPs, including £7.6 mln in cash. He claims the two lawyers stood to receive a share of the LLPs’ profits but did not disclose their financial interests in the scheme. Then in 2007, UK tax authorities launched a fraud investigation into CCL, with Gorton’s claim stating that “it currently appears that the claimants will lose the entirety of their initial capital contributions.” (Law.com)
And finally… One climate change benefit: better chocolate – A new study from Swiss researchers takes a look into the future of the Bolivia’s famed chocolate, finding that with higher temperatures and less moisture in the soil, the cocoa beans showed significantly higher phenolic (flavour) and antioxidant levels, as well as a lower fat content. (Modern Farmer)
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