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TOP STORIES
EU carbon prices set to double by 2021, could hit €55 before 2030 -report
EU carbon prices are set to double from current levels by 2021 and could quadruple to €55 before 2030 if lawmakers align the ETS’ emissions reduction trajectory with the goals of the Paris Agreement.
Productivity Commission backs agriculture in NZ ETS, urges ramped-up carbon price
New Zealand’s Productivity Commission on Friday urged the government to bring agriculture into the emissions trading scheme, and pave the way for carbon prices to grow almost tenfold over the next three decades in case new technologies are slow to emerge.
AMERICAS
California’s ARB says supply glut will not hamper 2030 emissions goals
California regulator ARB does not expect tens of millions of unsold allowances in its cap-and-trade programme to jeopardise the state’s 2030 GHG target, according to the agency’s estimates.
Mexican senate approves bill to bolster emissions trading plans
Mexico’s Senate passed a bill late Wednesday that gives a clearer mandate to the country’s planned carbon market and to align national emission reduction goals with Paris Agreement targets.
New Jersey expects RGGI revenues to start flowing in mid-2020
The New Jersey Department of Environmental Protection (DEP) expects to start earning revenue from RGGI allowance auctions in fiscal year 2020, consistent with the department’s thinking outlined at a presentation last month.
NA Markets: WCI prices tread water near auction floor, though pre-sale selling notably absent
North American carbon prices stabilised over the last week as both the east and west coast markets began to focus on the spring auctions.
EMEA
EUA prices could dip towards €11 if investor interest cools -analysts
EU carbon prices could dip back to as low as €11, some 22% below recent highs, if investors cool their recent interest or opt to take profits from selling EUAs bought at much lower prices, ICIS analysts said on Thursday.
EU Market: EUAs jump to 1-week high on massive auction premium
EU carbon prices jumped to a one-week high on Thursday after the day’s auction cleared at the largest premium to the secondary market in nine months.
ETS emissions ticks higher at Finnish utility Fortum
Finnish utility Fortum emitted 1.1 million tonnes of CO2 from its EU ETS-regulated facilities over the first quarter, up 22% year-on-year, it said in financial results on Thursday.
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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
Beast of burden – German Environment Minister Svenja Schulze wants a discussion “about the existing models for CO2 pricing that do not put an additional burden on citizens, but still provide an incentive to reduce CO2,” she said in a parliamentary debate. Schulze said that the reform of the EU ETS was beginning to show effects with higher prices, and that now it was “logical” to think about other ways of CO₂ pricing in sectors not covered by the ETS, like transport and heating. In light of the increased integration of all sectors (sector coupling), “it makes little sense to burden electricity with taxes and levies, while not putting a reasonable CO₂ price on fossil energy sources,” she said. But Georg Nuesslein (CSU), deputy leader of the conservative CDU/CSU parliamentary group, said that a price on CO2 would lead to additional burdens on citizens. Climate protection was an international topic that called for international solutions, so “we do not want national solo efforts,” he said. (Clean Energy Wire)
Attack the tax – US Republican House of Representatives members Steve Scalise and David McKinley introduced an anti-carbon tax resolution on Thursday. The proposal, H. Con. Res. 119, was described by House Majority Whip Scalise as preventing against a carbon tax that “would run counter to the goals of American energy dominance and national security.” The resolution was backed by a coalition of 24 conservative groups, led by Americans for Tax Reform, which said that a carbon tax would produce less income and jobs for American families. Thursday’s measure follows a 2016 House vote that saw the GOP majority approve a non-binding resolution in opposition to a carbon tax, despite President Obama not having proposed one at the time.
Flexible nukes – A new study in Applied Energy finds that US nuclear plants can shift to flexible output levels in a way that complements the increasing penetration of renewables, Axios reports. As the study notes, US nukes are often portrayed as only behemoth baseload resources that inflexibly generate huge amounts of power. But that doesn’t have to be true and isn’t in some other countries, according to researchers with MIT and Argonne National Laboratory. The researchers explore a way in which greatly expanded use of variable wind and solar can pair with flexible nuclear power in order to help decarbonise the power grid. A separate study conducted by Energy Brainpool and commissioned by power supplier Greenpeace Energy found that renewable, controllable power supply would be less expensive than producing electricity in new nuclear power plants in eastern Europe.
Swift growth – Global wind energy capacity could increase by more than half over the next five years as costs continue to fall and the market returns to growth at the end of this decade, the Global Wind Energy Council (GWEC) says. In its annual report on the status of the global wind industry, the GWEC said cumulative wind energy capacity stood at 539 GW at the end of last year, 11% higher than the previous year. That should increase by 56% to 840 GW by the end of 2022 as countries cut emissions and prices continue to fall. (Carbon Brief)
Getting by with less help from my friends – A new US EIA report takes stock of subsidies for various energy sources in recent years, Axios reports, showing a substantial decline between fiscal years 2013 and 2016. Subsidies for many categories dropped during that period, when spending related to American Recovery and Reinvestment Act was at or near its highest levels. Direct federal financial interventions and subsidies in the energy market fell by nearly half – from $29.3 billion in 2013 to $15 billion in 2016.
Coal cuts – India’s newest power-sector blueprint, the National Electricity Plan 2018, reinforces the government’s commitment to transforming the Indian electricity sector, retaining a core target of 275 GW of renewable energy by 2027, according to IEEFA. And taking into account plant retirements and new construction totaling 94.3 GW into account, the NEP sees India’s coal power capacity hitting 238 GW in 2027, 11 GW lower than the 2016 forecast. Separately, a court Russia’s main coal-producing region of Kuzbass has overturned a permit granting a private company proposing a new coal mine the right to compulsorily acquire agricultural lands. The decision has been welcomed by the environmental group Ecodefense as being the first time a Russian court has overturned a permit for a coal mine. (CoalWire)
Probe time – The Canadian federal finance department is now under investigation by the Office of the Information Commissioner for its refusal to release data about the estimated costs of carbon taxes on consumers. Responding to a complaint made by Conservative finance critic Pierre Poilievre, the OIC has begun looking into whether the department violated sections 21 and 18 of Canada’s Access to Information Act. Poilievre had filed an access request asking for government documents that explain the projected annual costs per household of the Liberal government’s planned pan-Canadian C$50/tonne carbon tax in 2022, but the documents reportedly had all the pertinent information redacted. (Canoe)
Just transition – The Canadian federal government has created a new team of leaders from the labour and environmental movements, as well as industry, to help shape the transition plan for thousands of coal workers who will soon be out of work, the National Observer reports. The new task force is developing new policies nearly two years after Ottawa promised to create a “just transition” plan to help coal workers and communities cope with the phase-out of coal-fired power plants across the country. It will be co-chaired by Canadian Labour Congress President Hassan Yussuff, who had publicly pushed for the body at COP-23 last year, and Conservation Council of New Brunswick executive director Lois Corbett.
New joiners – The REDD+ Business Initiative (RBI) has welcomed three new members: international energy company Shell, energy provider Greenchoice, and clothing brand DutchSpirit. Established by a group of companies in 2017, the RBI is designed to help corporates integrate the conservation of tropical forests into their strategy to tackle climate change. Members of the RBI jointly invest in forest management and sustainable agriculture in the tropics, based on the UN’s global forest conservation scheme, REDD+.
And finally… Are we in trouble? – More companies are seeking advice about how to combat climate change litigation should the kinds of heavyweight suits launched in New York emerge abroad. Martijn Wilder, an Australia-based partner at Baker & McKenzie in charge of global environmental markets and climate change, said the firm hadn’t done much climate litigation in the past, but the pace of inquiries from companies seeking reassurance about any potential liability had quickened. “For the first time we are starting to be asked by clients who think they have got a threat of this litigation what the likelihood and the probability of it is,” Wilder told the Australian Financial Review. “That litigation is now a real risk and could become like tobacco litigation,” he added, echoing the comparison recently championed by former California Governor Arnold Schwarzenegger.
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