CP Daily: Monday September 24, 2018

Published 23:52 on September 24, 2018  /  Last updated at 23:53 on September 24, 2018  /  Newsletter  /  No Comments

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

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TOP STORY

California offset developers still holding out hope for removal of buyer liability

While the latest proposed California cap-and-trade regulations are seen doing little to impact offset issuance timelines, project developers are hopeful that future measures could tackle, and possibly eliminate, buyer liability or invalidation risk.

EMEA

EU Carbon: EUAs recover more lost ground as energy market surges

European carbon prices added 1.3% on Monday, recovering more of the ground lost earlier this month but shying away from the larger gains posted by the wider energy complex to start the week.

Some green power contracts may be void under no-deal Brexit, UK warns

Some types of Guarantees of Origin (GOs) trades between the EU and Britain may be rendered invalid under a no-deal Brexit, as British-sourced units would no longer be recognised on the continent, the UK said Monday.

AMERICAS 

Exempt RGGI units to make up bulk of GHG reductions under New York CO2 price -analysts

Applying a carbon charge to New York’s wholesale electricity markets would stimulate GHG cuts from generators exempt from the northeast US RGGI programme, while bigger in-state units covered by the carbon market would see an increase in emissions, according to new analysis presented on Monday.

Quebec carbon fund ventures into Alberta offsets programme

The Quebec-based Inlandsis Fund has partnered with Bluesource to expand the carbon offset developer’s methane reduction programme in Alberta, the two companies announced Monday.

ASIA PACIFIC

Sydney Opera House gives high-profile boost to Australia’s voluntary carbon market

Australia’s voluntary carbon market saw a high-profile boost on Monday when the Sydney Opera House announced it would turn its famous sails green to show that it had achieved carbon neutral status under the government’s National Carbon Offset Standard after buying carbon credits.

NZ Market: NZUs stuck in range-bound trade as buyers keep feet off gas

Trade in New Zealand carbon allowances has slowed to a trickle within a tight price range as emitters are reluctant to pay much above the fixed price for permits.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

WIN A TESLA! – Massachusetts-based Climate XChange is raffling off three new Teslas on New Year’s Day. The organisation – a small team with big ambitions of putting a price on carbon emissions and securing a healthier future for communities and local economies – his holding the draw to fundraise for its activities. Working from an American Revolutionary–era church in downtown Boston, Climate XChange is helping advocates from across the country follow its lead and spark campaigns to pass carbon pricing legislation at the state level.

So much to lose – The United States stands to lose a lot more from climate change than it realises. In a study published Monday, scientists estimate for the first time how much each country around the world will suffer in future economic damage from each new tonne of CO2 pumped into the atmosphere. What they found may come as a surprise: the future economic costs within the US borders are the second-highest in the world, behind only India. Some smaller countries will lose significantly larger portions of their economies to climate change. But the authors found, after modelling hundreds of scenarios, that the US consistently faces among the costliest damages, as measured by the social cost of carbon. (Inside Climate News)

Justice postponed – A lawsuit challenging the Ontario government’s decision to cancel the province’s cap-and-trade programme without public input or a replacement proposal will not be heard until later this year or next year, officials said. Ecojustice, in conjunction with the University of Ottawa-Ecojustice Environmental Law Clinic, filed the lawsuit in September on behalf of Greenpeace Canada. The group had sought an urgent court hearing on the issue, but Ecojustice said they are no longer seeking a speedy hearing after the government opened public consultation on the cap-and-trade cancellation bill. The organisation said the lawsuit will likely be heard later this year or in 2019.

Oops, forgot about that – Electricity generator and retailer AGL is Australia’s biggest carbon emitter, but has pledged to phase out all its coal plants by 2050. However, in the shorter term the company is struggling with environmental compliance. AGL has been fined A$3 mln ($2.2 mln) for failing to surrender enough certificates under Victoria’s state energy efficiency scheme, the only company to fail 2017 compliance. The shortfall was an oversight, the company said. (RenewEconomy)

Le status quo – The French government will barely increase spending on renewable energy next year, with a planned rise of 1.3% effectively flat after taking inflation into account, France’s ecology ministry draft’s budget showed on Monday. According to Reuters, spending on renewables projects will total €7.3 billion euros next year and will mostly go towards wind and solar projects. France is lagging its European rivals in renewables, and falling behind its long-term target to develop renewables which could help it to curb its dependence on nuclear power that currently accounts for over 75% of its needs. According to the draft budget, France will maintain its plans for a increases in its domestic carbon tax, which covers transport and heating fuels. The tax will increase to €55/tonne in 2019 from €44.60 per tonne this year. The government said last year the tax would then increase to €65.40 in 2020, €75.80 in 2021, and €86.20 in 2022.

Heroes to zero – The Marshall Islands became the latest nation to pledge that it would achieve net zero carbon emissions by 2050. The small island nation, which has been a strong voice for global climate action for years, released an economy-wide plan to reduce its GHG output and said it would embed the strategy in national legislation subject to five-yearly reviews, similar to that in the UK. The strategy was announced at the beginning of the Climate Week in NYC.

Fresh climate cash, of sorts – New Zealand Prime Minister Jacinda Ardern delivered a speech at Climate Week and announced a fresh NZ$300 mln ($200 mln) in climate change funding, which will specifically go towards adaptation measures in Pacific islands. The contribution will more than double New Zealand’s funding, which so far amounts to NZ$200 mln, according to the foreign affairs and trade ministry. Only NZ$3 mln of that will be channelled through the Green Climate Fund though. The money will also come out of New Zealand’s Overseas Development Assistance fund, which poor countries say is against the spirit of the Paris Agreement because it then comes at the expense of other aid initiatives rather than being new and additional funding. (Stuff)

Mongolia mechanism – The Asian Development Bank’s Japan Fund for the Joint Crediting Mechanism (JFJCM) has awarded a $6 mln grant to help fund a distributed renewable energy system project in western Mongolia. The 41MW project will also receive a $40 mln loan from the ADB, a $14.6 mln grant from the bank’s Strategic Climate Fund, and $5.6 mln from the Mongolian government. It is expected to generate just over 6,000 JCM carbon credits per year that Japan and Mongolia will use towards their Paris targets. Japan has contributed more than $51 mln to the JFJCM.

Here we go again – Washington DC Councilmember Mary Cheh introduced the Clean Energy DC Act on Monday, following her original introduction of the 100% RPS bill prior to the council’s summer recess. The legislation, which would see the US capital source all of its energy from renewables by 2032, also includes sweeping building efficiency standards and raises the fee on “dirty energy” the city already has in place. Mayor Muriel Bowser has pledged to halve the District’s GHG emissions from 2006 levels by 2032, and an August analysis from the Department of Energy and Environment found that the bill would see cuts of 49.4% below the baseline over the next 14 years. (Think Progress)

Here we go again, part 2 – The Trump administration is set to announce a policy change in the coming weeks that will allow for the year-round sale of 15% ethanol blends (E15), reports Bloomberg. The change, which has been widely rumoured this year as a potential remedy in the ongoing battle between biofuel and refiner interest groups over the direction of the federal Renewable Fuel Standard (RFS), would overturn a ban on the sale of E15 from June 1 – Sep. 15 currently enforced due to concerns about smog. Pacific Ethanol saw its shares gain as much as 17% on the news, with fellow biofuels producer Green Plains seeing a 4.6% increase.

Here we don’t go – Quebec’s environment ministry announced on Monday that it will not hold a mutual agreement carbon allowance sale on Oct. 3 due to low demand. The regulator had originally designated over 39 million WCI-eligible allowances for sale, but the lowest tier of C$53.38 was well above current secondary market prices closer to C$20.

Take the high road – Scotland needs to take more rigorous action on emissions from farming and transport in order to meet its ambitious climate targets, according to a new report from the UK Committee on Climate Change (CCC). The analysis found that Scotland’s progress with renewable energy has “masked” a lack of progress in areas including agriculture, transport, and domestic heating. However, the report reconfirms that Scotland is outperforming the rest of the UK in reducing its GHGs. The committee recommended that Scotland renewed focus on tree-planting and peatland restoration – as targets for both have been repeatedly missed. Transport accounted for more than a third of Scotland’s overall emissions of 41.5 MtCO2e in 2016. To achieve Scotland’s post-2020 target to cut emissions by 66% by 2032 and by 90% by 2050, tougher transport measures must be introduced, according to the CCC. These could include free parking and special lanes for electric cars. (Carbon Brief)

Pull punches – Key messages from the upcoming IPCC Special Report on Global Warming of 1.5C have been “watered down” to make them more “palatable” to countries that are reluctant to cut their fossil fuel emissions. Report reviewer Bob Ward, policy director at the Grantham Research Institute, said “downplaying the worst impacts of climate change has led the scientific authors to omit crucial information from the summary for policymakers.” He said edits have been made to the summary for policymakers – the document that will act as a guideline for politicians – to omit “any mention that temperature rises of above 1.5C could lead to increased migrations and conflict”. An IPCC spokesperson told the Observer that member governments would work to ensure the summary for policymakers was consistent with the findings in the main report. “

Promoting pricing – Introducing a systematic price on carbon would be a “powerful way” to fight climate change, according to Philippe Le Houerou, CEO of the IFC, the World Bank’s private sector-focused unit. “IFC itself is actively engaging with our clients on many climate-related issues. We strongly believe, though, that the specific step of putting a price on carbon will create more climate business opportunities and accelerate progress in emerging markets toward a low-carbon future.” (Financial Times)

Do as I say, not as I fly – The globe-trotting travels of the UN’s environment chief have been sharply criticised in a draft internal audit as “contrary to the ethos of carbon emission reduction”. Erik Solheim, executive director of UN Environment, was travelling for 529 out of the 668 days audited, spending $488,518 (£370,380), according to the report. The audit also said he had “no regard for abiding by the set regulations and rules” and claimed unjustified expenses. The development comes amid growing concern among some UN Environment officials, with sources claiming his “haphazard and dictatorial management style” has “already made us dysfunctional in many respects”. Solheim told the Guardian he had already paid back money for instances of oversight and made changes where other rules had been broken. He said he could not comment in detail on the audit until it was completed and published: “If any other mistakes are found, we will immediately correct them.”

And finally… Book club – It was only a matter of time. With the emergence of the so-called ‘cli-fi’ genre of fiction, carbon trading murder mystery novel was bound to be written. Paul Schueller is the founder and CEO of Wisconsin-based Franklin Energy, a company that works to help utilities become more energy efficient and save consumers money. He’s also a writer, and his first published novel “The Squeeze” features an intricate plot involving partners in a carbon trading business, a possible murder, and underhanded business dealings that Schueller said are based on real-life fraudulent activity involving himself and the Chicago Climate Exchange (CCX). Schueller told WUWM his career in the energy industry has given him more than enough insights – on how things could go wrong – to formulate a mystery novel.

Separately, US carbon market expert Mike Taylor of Emission Advisors, Inc. has written a book on strategies for reducing carbon compliance costs. Appropriately named ‘Reduce Carbon Compliance Costs: Strategies for California and Quebec facilities to reduce their compliance cost in the Carbon Cap and Trade Program’, the book targets environmental professionals or those responsible for managing carbon cap-and-trade compliance for their facilities, and helps them navigate the rules, which he says “are complex and change almost yearly”. “In these pages, you will find real-life trading strategies that will reduce the cost of compliance and, depending on the size of your facility, the savings could shave millions of dollars off your compliance costs which adds directly to the bottom line of the company’s profitability.” (Amazon paperback, $11.71)

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