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The UK government’s cabinet of senior ministers has backed a Brexit text crafted by negotiators, Prime Minister Theresa May said late Wednesday, increasing the chances that lawmakers will endorse the EU divorce deal that keeps the country in the EU ETS until the end of 2020.
The Nova Scotia environment ministry published regulations Wednesday that outline the annual emissions cap for its carbon market that would begin in Jan. 2019 and allowance sale procedures that would start the following year.
The European Commission has cautioned stakeholders over their suggestion that the EU carbon market is being manipulated, as participants called for more transparency.
European carbon allowances are forecast to remain above €20 even in the case of a massive sell-off by the investors who helped prices triple in the past year, analysts said.
German utility RWE advanced its EUA hedging over Q3, albeit at a slower rate than the previous quarter, the company said Wednesday, providing a mixed signal for carbon.
EU carbon prices slipped back below €20 in another wavy session on Thursday, closing down nearly 2% despite a bullish auction result.
California’s 2019 cap-and-trade price floor should rise to $15.62 after year-over-year inflation increased slightly to 2.5% during October, data showed on Wednesday.
A mounting allowance surplus spurred by declining fuel sales in the WCI cap-and-trade programme should result in smaller price gains than previously expected following Wednesday’s auction and into the next decade, according to analysts.
California regulator Air Resources Board (ARB) issued more than 835,000 offsets over the past three weeks, including roughly 51,000 credits before the WCI market’s Nov. 1 compliance deadline, state data showed Wednesday.
RGGI prices and trading activity increased significantly on the secondary market during the third quarter, but the ETS saw fewer transfers between unaffiliated companies, according to a report published Wednesday.
Thailand is expecting to put in place over the next eight months a number of the elements that will make up its national carbon market, but the lengthy process of imposing a national climate change act means the programme won’t launch until after 2020.
New Zealand carbon allowances on Wednesday fell below the NZ$25 fixed price option for the first time since Aug. 29 as bids retreated to NZ$24.90 ($16.89).
BITE-SIZED UPDATES FROM AROUND THE WORLD
**#OCTT – Carbon Pulse is helping to pioneer a new Twitter hashtag for tweets and discussion surrounding the world’s carbon markets. Starting today, we are using #OCTT in such tweets. Borrowing from the oil markets’ #OOTT, our acronym stands for the Organisation of Carbon-Trading Tweeters. Please join us in mainstreaming this new hashtag to further discussion of carbon markets on social media. Once it picks up steam, we can consider regionalising it based on the various schemes.**
Slowing down – The rapid growth in Chinese energy demand seen earlier this year continued to slow down in October, data from the National Bureau of Statistics showed Wednesday. Total power generation in October rose 4.8% YoY, compared to 7.2% over Jan-Oct. Thermal power output was up 3% YoY in Oct., and 6.6% in the first ten months of the year. While the demand growth is slowing down, China remains on track to see significant carbon emissions growth this year, after GHG output stood more or less still in the previous three years.
Will they/won’t they – A plan to revive a select a US Congressional committee on climate change is generating pushback on day one from both liberal activists who say Democrats need to do more and from at least one member of the old establishment. Rep. Frank Pallone, who is in line to lead the powerful Energy and Commerce Committee, dismissed a new panel as a waste of time because it would duplicate the oversight responsibilities of existing committees without being able to produce new legislation, Politico reports. “I don’t think it’s necessary,” the New Jersey Democrat said. But Rep.-elect Alexandria Ocasio-Cortez, the liberal rising star, pushed in the opposite direction. She is calling for a “Select Committee For A Green New Deal” that would be empowered to write legislation aimed at achieving 100% renewable energy in 10 years, among other lofty goals, and said members who accepted contributions from the fossil fuel industry should not serve on the panel. It’s unclear if those ideas will catch on with most Democrats, but Rep. Ro Khanna, a member of the Progressive caucus, endorsed the proposal in a tweet Tuesday.
Future coal – The US Energy Department is funding research to develop “coal plants of the future,” it announced Tuesday. The department plans to issue three competitively funded research and development efforts in fiscal 2019 to ultimately result in the design, construction, and operation of a coal-based pilot-scale power plant.
No price – Australia’s energy minister, Angus Taylor, on Wednesday dismissed Woodside Petroleum’s Tuesday call for a carbon price and radical new climate policy, claiming the company was simply talking up its book. Taylor said Australia is already moving too fast on climate by investing too much in renewable energy, and added for good measure that no other country in the world has done as much as Australia to reduce emissions. That’s despite government data showing that the country’s emissions have increased every quarter since Mar. 2014. (Renew Economy)
Not sure – Meanwhile, Australia Environment Minister Melissa Price was confronted with those rising emissions during an ABC radio interview, but said she was unable to pinpoint exactly when Australia’s emissions would start falling, the Guardian reported, claiming both that the government was reviewing its climate policies and that those policies were good enough. In the same interview, Price defended herself against remarks from within her own party that she was a minister on “L-plates”.
Please explain – The UK government and Environment Minister Claire Perry are under pressure to provide more details on how a no-deal Brexit would affect power prices, carbon markets, and Irish energy-sharing, Climate Home reports. In a letter to Perry published Wednesday, Liberal Democrat Lord Robin Teverson, chair of the sub-committee on EU energy and environment, said the panel wants more answers on how an abrupt departure from the EU ETS would affect carbon pricing in the country and on the continent. The government said in its 2018 budget late last month that it would immediately impose a domestic tax of £16 per tonne on CO2 emitted from all stationary installations that currently trade on the EU market. “On what basis was that value selected?” Teverson asked. “And is there any intention for it to be adjusted over time to mirror the EU ETS carbon price?” He also expressed concerns about a letter the Scottish and Welsh governments wrote to London in October, saying they would object to replacing a carbon market with a tax and asking for ministerial talks. “This disregard strikes us as extremely concerning,” Teverson said, and asked if further discussions with Cardiff, Edinburgh, and Belfast have taken place and whether there is progress on reaching a deal.
Truck stop – The EU Parliament backed the region’s first ever curbs on CO2 emissions from trucks, calling for a cut of at least 35% by 2030, tougher than the 30% proposed by the EU executive but still requiring negotiation early next year with harder-line member states yet to come up with their own view. (Reuters)
Forest fortitude – France has set out plans to tackle world deforestation, saying it would look to curb imports of products such as palm oil, soy, and beef. It proposed 17 measures aimed at putting a halt to deforestation caused by imports by 2030. These include financial aid to encourage developing countries, the launch of a “zero deforestation” label for consumers by 2020, and a push next year for a European policy on imports posing a risk for forests. (Reuters)
Early peak – The government of Jinan, the capital of China’s Shandong province with a population of some 7 mln, has released its low-carbon strategy, pledging to peak GHG emissions in 2025 – five years earlier than the national government’s Paris goal. The plan also said Jinan would contribute to building the national ETS and explore setting up a unified platform for trading energy consumption rights as well as CO2 allowances and offsets.
Fuel economy meeting yesterday – California and Trump administration officials held a meeting on Tuesday – their first of its kind in over six weeks – regarding ongoing negotiations over federal vehicle fuel economy standards. In response to the Trump administration’s proposed rollback of the fuel economy standards for model years between 2021 and 2026, California officials reportedly submitted a “counter-proposal” to the federal plan, and Acting EPA Administrator Andrew Wheeler told reporters that it was his understanding the meeting was “positive”. California regulator ARB approved changes in September to maintain higher fuel economy standards, though the federal government is planning to revoke California’s waiver under the Clean Air Act to authorise a separate mandate. (InsideEPA/Climate).
Cap-and-trade meeting tomorrow – California’s ARB will hold its first meeting Thursday about proposed cap-and-trade amendments slated for approval early next year. The amendments would install a price ceiling in 2021 and set post-2020 Allowance Price Containment Reserve (APCR) price points to conform to the requirements of last year’s AB-398, which extended the programme through 2030. The package would also reduce the offset usage limit to 4% in 2021 and require half of those credits to have a direct environmental benefit to the state. The ARB delayed the board meeting until November after getting a flood of comments from stakeholders about the proposed changes.
And finally… King of the batteries – Germany’s economy and energy minister, Peter Altmaier, has announced the target of covering 30% of global battery cell demand with production “in Germany and Europe” by 2030 to make the continent more independent from Asian imports. At a mobility conference in Berlin, Altmaier said batteries were a “game changer” technology that would profoundly affect entire value chains in the car industry and beyond. “It’s not too late yet, but we have to hurry up.” He said the government had set aside €1 billion to support company alliances for battery cell production until 2021, adding that Europe must produce the world’s best and most sustainable batteries using renewable power and achieving high recycling rates. “We might not win the race for the cheapest battery, but the race for the best batteries remains undecided. Germany takes on the challenge,” Altmaier said, adding that funding decisions will be announced around the turn of the year, followed by concrete investment decisions at various locations at the end of Q1 2019 so that production can start in 2021. He said the location of battery cell factories was also a topic for Germany’s coal exit commission, suggesting that they could be built in regions that will be hit by that sector’s impending phase-out. (Clean Energy Wire)
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