Presenting CP Daily, Carbon Pulse’s free newsletter. It’s a daily summary of our news plus bite-sized updates from around the world. Subscribe here
Almost 265 million EU carbon allowances will be withdrawn from the over-supplied EU ETS in the first eight months of 2019 and inserted into the MSR when it launches early next year, the European Commission announced late on Tuesday.
European utilities were relatively quiet in the rallying EUA market over Q1, company results suggest, representing potentially bullish news for prices as generators may now need to accelerate their EUA buying.
The EU’s efforts to decarbonise heavy industry are being undermined by ETS benchmarking rules that systematically block cleaner industrial alternatives from getting a foothold, according to environmental campaigner group Sandbag.
EU carbon prices slumped on Tuesday after extending a recent seven-year high in early trade and following another weak auction.
A former Deutsche Bank sales manager has been jailed by Germany’s federal supreme court for three years for his role in facilitating tax fraud through the EU carbon market.
South Korea has pledged to meet a third of its Paris target through buying international carbon credits, and is now considering pushing that responsibility over to companies in its emissions trading scheme rather than spending taxpayer funds.
Coal-fired power generation in China rose 7.3% year-on-year in April, outpacing overall power output amid an ongoing manufacturing boom and threatening to derail efforts to curb carbon emissions.
Market participants should expect an under-subscribed WCI auction this quarter along with more modest price increases in the medium-to-long term, according to analysts.
IBM and Veridium Labs have teamed up to launch a blockchain-based platform to transform carbon offsets into digital tokens for trade on a decentralised exchange, the companies announced on Tuesday.
CARBON FORWARD 2018
Don’t miss the 3rd annual Carbon Forward conference and training day – Oct. 16-18, 2018 in London.
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.
BITE-SIZED UPDATES FROM AROUND THE WORLD
Not cool – Global energy demand from air conditioners is expected to triple by 2050, requiring new electricity capacity the equivalent to the combined electricity capacity of the US, EU and Japan today, according to new analysis by the International Energy Agency that stresses the urgent need for policy action to improve cooling efficiency. Using air conditioners and electric fans to stay cool already accounts for about a fifth of the total electricity used in buildings around the world – or 10% of all global electricity consumption today, the IEA said. It estimates the global stock of air conditioners in buildings will grow to 5.6 billion by 2050, up from 1.6 billion today – which amounts to 10 new ACs sold every second for the next 30 years, according to the report. Today, less than a third of global households own an air conditioner. In countries such as the US and Japan, more than 90% have air conditioning, compared to just 8% of the 2.8 billion people living in the hottest parts of the world.
Another brick – China’s Jiangxi province has released its annual climate and energy plan, pledging to draw up an allocation plan for 180 local carbon emitters as the landlocked region, home of some 44 mln people, is gearing up for the launch of the national ETS. The provincial government said it has done checks on CO2 emissions data for power and cement producers. It is also pushing a low-carbon urbanisation programme for its six main cities, including the capital Nanchang.
Zero progress – The energy consumption level of buildings in Germany was stagnant between 2010 and 2016, a report prepared by the German Energy Agency (dena) reveals. The trend of improving energy efficiency, which saw energy consumption drop by 20% between 2002-10, “seems to be over,” the agency said. “The current efforts in the area of energy efficiency are not enough to meet the climate targets and the associated reduction in greenhouse gas emissions in the building sector.” Heating and power consumption in buildings accounts for more than one third of Germany’s total energy demand, which is why more efficient use of energy in the sector could contribute substantially to achieving the country’s emissions reduction goals, the agency says. (Clean Energy Wire)
CCS cash injection – Norway has announced around €8 million in new funding for its CCS demonstration project. In a revised budget proposal released Tuesday, Norway agreed to allocate the cash towards engineering and design studies for CO2 capture at the Norcem cement facility, with further studies required at the Klemetsrud waste-to-energy plant. No funding was earmarked for fertiliser-maker Yara’s ammonia plant in the country after the country decided to withdraw from the initiative. It brings total funding for the CCS project in 2018 to almost €30 million, including funds transferred from 2017. (BusinessGreen)
Clean Air appeal – The Washington state Department of Ecology (ECY) has filed an appeal to the state’s Supreme Court over a lower court’s decision to stay the agency’s Clean Air Rule. A series of rulings in the Thurston County Superior Court, the most recent of which came in March, has prevented ECY from regulating Washington state emitters with annual outputs over 100,000 tCO2e, saying that the department does not have the legislative authority to implement the policy. This comes after an ECY spokesperson told Carbon Pulse in March that the agency would take their appeal of the ruling all the way to the federal Supreme Court if necessary, though it remains unclear whether or not ECY would go that far should their state-level filing be rejected. The Clean Air Rule was developed in 2016 as a way of getting around the state legislature’s defeat of Governor Jay Inslee’s cap-and-trade proposal in 2015, and the appeal comes after subsequent failures of carbon tax ballot initiatives and legislative proceedings in 2016 and 2018 respectively.
Not by a long shot – Oil giant Shell has a long way to go in creating a climate plan that steers well clear of avoiding a 2C rise in global temperatures, according to research director Greg Muttitt of advocacy organisation Oil Change International. Speaking at a press briefing on Tuesday, Muttitt critiqued Shell’s “Sky Scenario” released in March, which would see the company reduce the energy intensity of its products and operation by 50% in 2050. However, Muttitt noted that Shell still plans on increasing its oil and gas output over that timeframe, while also saying that the scenario does not mention the 1.5C goal contained in the Paris Agreement. The briefing comes ahead of Shell’s annual shareholder meeting on May 22, in which investors will vote on a resolution that would see the company set climate targets in line with the 2015 UN accord. Shell has advised its shareholders to oppose the measure, saying it is not in the best interests of the company.
Green gains – Green employment opportunities spurred by the Paris Agreement well help create 24 million jobs by 2030, according to a report released Tuesday by the UN’s labour body. The International Labour Organisation (ILO) expects opportunities low-carbon sectors like in building efficiency and renewable energy to offset jobs losses in areas like coal mining and oil drilling, leading to a net gain of 18 mln. Moreover, heat stress will cause a job loss in hours worked of 2% in 2030 due to sickness. While the regions of Asia-Pacific, Europe, and the Americas will see job gains, the dependency of workers on fossil fuel production in the Middle East and North Africa could lead to small job losses in those areas. (Climate Home)
Probably illegal – The American Petroleum Institute is no fan of Trump’s effort to make administrative changes to the Renewable Fuel Standard (RFS), Politico reports. The Trump administration is working on a memo laying out a series of administrative changes, including allowing year-round sale of 15% ethanol fuel, and possibly allowing exported ethanol to qualify for Renewable Identification Numbers (RINs) under the RFS. API opposes allowing broader sales of E15, saying it agrees with EPA’s prior declarations that the agency does not have the authority to allow it. Ultimately, API wants Congress to enact major changes to the program, and its top priority is having the program shut down rather than tinkering around the edges, Politico reports.
Might as well be illegal – Iowa Senator and prominent RFS advocate Chuck Grassley (R) told a conference call with reporters on Tuesday that he will call for the resignation of EPA Administrator Scott Pruitt if the agency does not curtail its issuance of biofuels waivers for small refineries under the RFS. Grassley and other agriculture-state senators have vociferously opposed the waivers – granted by the EPA in private – that they said have killed demand for ethanol and sunk the price for RINs by creating a supply glut. Grassley is notably one of the only Republicans to call for Pruitt’s resignation in recent months, with Democrats having largely beaten the drum to oust the EPA head over controversies related to high spending, travel, and security. (Reuters)
And finally… Talkin’ bout my generation – Young Republicans are far less likely to support the continued use of fossil fuels than their older counterparts, a new survey from Pew published this week reveals. This year’s version of Pew’s regular environmental survey shows a large gap between Millennial and Boomer Republicans on several issues, including a 30 percentage point gap between the two generations on support for offshore drilling. The poll also shows that 87% of GOP Millennials support expanding wind farms, while 83% support expanding solar farms. Nearly 60% of young Republicans think climate change is having at least some effect on the US, and nearly 50% think the government is not doing enough to reduce its effects. (Climate Nexus)
Got a tip? Email us at email@example.com