CP Daily: Friday March 2, 2018

Published 23:45 on March 2, 2018  /  Last updated at 00:05 on March 3, 2018  /  Newsletter  /  No Comments

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

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TOP STORY

ARB gives early insight into design of post-2020 California cap-and-trade

California regulator ARB held a public workshop Friday on preliminary post-2020 updates to the state’s cap-and-trade programme, addressing potential changes regarding overallocation, offsetting, and other elements of the scheme’s new possible design.

EMEA

Updated EU analysis ups pressure to go further on clean energy

Rapidly falling renewables costs mean the EU can set more ambitious 2030 clean energy goals without harming its economy, according to updated Brussels figures likely to exert further pressure on member states to agree tougher targets, which without further safeguards, will be bearish for carbon prices.

EU Market: EUAs creep back above €10 as warmer temperatures loom

EU carbon prices climbed back above €10 on Friday for a 3.4% weekly gain, keeping EUAs within reach of Wednesday’s six-year high reached after the bloc’s lawmakers gave the final nod to post-2020 ETS reforms.

Barclays parts ways with EU carbon and utilities research director

Barclays’ managing director for EU carbon and European utilities research has parted ways with the investment bank, Carbon Pulse has learned.

ASIA PACIFIC

China industry group urges parliament to pass ETS legislation

The All-China Federation of Industry and Commerce on Friday urged the country’s parliament to push legislation underpinning the national emissions trading scheme ahead of its annual congressional session, which begins next week.

Australia’s Santos earns first carbon credits

Santos, Australia’s second-biggest independent oil and gas producer, this week received its first carbon credits under the government’s offset programme.

CN Markets: Pilot market data for week ending Mar. 2, 2018

Closing prices, ranges and volumes for China’s regional pilot carbon markets this week.

AMERICAS

Alberta utility TransAlta sees offset revenue drop alongside GHG emissions in 2017

Calgary-based power generator TransAlta reported a decline in its carbon offset revenue in 2017, while the company’s GHG also shrank year-on-year.

ECOSYSTEM MARKETPLACE

Can the World Bank model show us how to de-risk US environmental markets?

Given the regulatory risk that environmental markets can be altered or ended with the “stroke of a pen” from policy makers, lenders are generally unwilling to value revenue from environmental markets when underwriting projects. With this heavy, or complete, discounting of environmental market revenues, these markets fail to entice the level of investment needed for projects to generate environmental credits and provide verifiable conservation benefits. How can we reduce the risks associated with environmental credits and keep these critically important projects moving forward?

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CARBON FORWARD 2018

SAVE THE DATE: Carbon Forward 2018 – Survive and thrive in the global carbon markets

Don’t miss the 3rd annual Carbon Forward conference and training day. Spend two days with top experts, players, and decision-makers from the global carbon markets as they address today’s most attractive opportunities and pressing challenges. And join us for the EU ETS pre-conference training day organised by carbon market experts Redshaw Advisors, where you will learn how to effectively manage your carbon risk ahead of the looming overhaul of the bloc’s emissions trading scheme.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Trolls on parade – Russian trolls used social media platforms to “inflame US political debate over energy policy and climate change”, according to a new report from the House Science, Space and Technology Committee, covered by the Washington Post. Russians created posts on topics such as fracking, the Dakota Access pipeline and government efforts to curb global warming, which are contentious political issues in the US. The posts were designed to appeal to either liberal or conservative audiences: for example, some posts expressed concern about climate change, while others mocked it. “This report reveals that Russian agents created and spread propaganda on U.S. social media platforms in an obvious attempt to influence the U.S. energy market,” said committee Chairman Lamar Smith, a longtime advocate for increased oil and gas drilling in the country. (Carbon Brief)

All dressed up but nowhere to go – The German federal government has said that the country’s security standby of lignite power plants with a total capacity of 2.7 GW has not yet been used, but operators are paid a total of €234 million in 2017 and 2018 to keep them at the ready, according to Frankfurter Rundschau. In order to reduce CO2 emissions in the power sector, the government agreed with utilities to put old and inefficient plants with a total capacity representing around 13% of Germany’s total lignite capacity on temporary security standby for four years, before they are eventually shut down permanently. The plants would only be called upon as a very last resort, for example in the case of long-lasting, extreme weather events. “The federal government rewards the coal industry with hundreds of millions of euros for doing nothing. Climate-harmful coal can be handsomely rewarded, while the federal government steps on the brakes regarding renewables,” said Oliver Krischer, deputy leader of the Greens’ parliamentary group. (Clean Energy Wire)

Under pressure – Global investors worth $84 billion have joined together to file a shareholder motion calling on Australian miner Rio Tinto to rethink its membership of the Minerals Councils of Australia, NSW Minerals Council (NSWMC) and the Queensland Resources Council (QRC), the Guardian reported. Coordinated by the Australian Centre for Corporate Responsibility, the investors seek to push the company to end memberships in coal lobby groups. A similar action towards BHP Billiton saw that company leave the World Coal Association and delivered an ultimatum to the MCA, saying it would leave unless the group changes its lobbying tactics.

Ain’t no thang – Climate change is critical to future energy markets but its effect on Chevron’s oil and gas business will be minimal for decades to come, according to a company report. With the prospect of tighter emission controls, carbon pricing and growth in renewable energy, some investors and activists are pushing companies to reveal the potential impact on their businesses. The risk for shareholders is that some projects become loss-making as the demand for oil and gas ebbs. (Bloomberg)

Secret problems – Executives at the world’s most ambitious CCS plant knew for years about serious design flaws and budget problems but sought to withhold key information from regulators before their plans collapsed, according to documents obtained by the Guardian. The Kemper plant in Mississippi – held up as the global model for a new generation of “clean coal” power plants – was the most expensive fossil fuel power plant in US history, with a $7.5bn price tag. But the documents uncovered evidence that the company had information showing that the project would blow through state-imposed budget limits five years before the company decided to reverse course and become an exclusively gas-fired energy plant.

Taxed taxiing – Taxing jet kerosene and applying a value added tax to plane tickets within Europe could raise €26.5 billion ($32bn) a year that could be used to plug an EU budget gap, reduce labour taxes and help meet climate targets, says a position paper by campaign group Transport & Environment. With the EU currently drafting its post-2020 budget and looking for alternative sources of revenue to make up for the UK’s Brexit departure, including taking a cut of EUA auction revenues, this is an opportunity to raise revenue from transport for both EU and national budgets while helping to tackle rising emissions from the sector, argues T&E. It calls for reforms of the 2003 Energy Taxation Directive (ETD) and rescinding of the exemption for the taxation of aviation and marine fuels, and require jet fuels on domestic and intra-EU routes to be subject at least to the EU minimum rate of fuel tax, which is currently €0.33 per litre. Value added tax (VAT) should also be levied on airline tickets for domestic, intra-EU and even extra-EU flights, says the Brussels-based NGO. (GreenAir Online)

And finally… Lions and humans and climate change, oh my! – The number of clashes between people and African lions could increase as temperatures rise, a new study suggests. The research shows that global warming could lead to changes in the geographical range of a disease carried by the tsetse fly – which can be deadly to cattle. It finds that, although the overall range of the disease is likely to increase, it could vanish from parts of eastern and southeastern Africa that support large numbers of lions. In turn, this could lead to cattle ranchers moving their animals into these areas. This could bring people and lions into close proximity, the lead author tells Carbon Brief, which may put herders in danger and trigger further declines in lion numbers.

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