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EU carbon prices have surged by around 15% so far this week on the back of bullish buying stoked by Brexit optimism and supported by a rising energy complex, but some have questioned whether the sharp gains are warranted or sustainable, especially in light of worsening fundamentals.
California and Quebec entities continued to stretch the joint cap-and-trade programme’s vast permit surplus even further after picking up additional unsold allowances during the first quarter of 2019, according to WCI data.
New speculators are continuing to drive California Carbon Allowance (CCA) prices ever higher on the secondary market, while RGGI allowances (RGAs) found their own support after levelling off the previous week, numerous traders said.
Virginia GOP lawmakers are using the budget process to prevent the state from joining the northeast US RGGI market in 2020, after Governor Ralph Northam (D) vetoed bills this year attempting to block that linkage.
Switzerland’s carbon credit procurement agency has opened its first call for proposals for GHG-cutting activities, with the aim of tying up its first emission trade agreements under the Paris Agreement.
More than 40% of electricity sold by China’s grid companies this year is likely to go through its recently-established power markets, according to the China Electricity Council (CEC), marking further progress in the ongoing power market reform seen as crucial for the success of the national carbon market.
Germany cut its greenhouse gas emissions by 4.5% in 2018, its government announced on Thursday, recording a significant reduction after almost a decade of stagnation.
BITE-SIZED UPDATES FROM AROUND THE WORLD
Downplaying risk – Asset manager BlackRock finds US investors are underestimating the risks that extreme weather poses to their portfolios, and that the industry needs to drastically alter how it considers climate change in its risk management processes. The lack of robust data had meant the extent of the underpricing of these risks had not been clear until now, BlackRock said. (Financial Times)
Monetary mandates – Climate change is increasingly affecting the world’s central banks and their monetary policies. Awareness is growing among currency guardians that weather disruptions, carbon emissions, and green finance will demand significant attention. Freak weather events largely risk becoming serious impediments to economic management in the future and could even require a rethink of central bank mandates at some point. The banks’ policies to support growth also have the potential to contribute to a greener planet. (Bloomberg)
Free rider – Nobel Prize economics laureate Joseph Stiglitz is calling on Europe and China to join forces against the US at the WTO, saying America has become a “free-rider” on climate change under the Trump administration, in violation of global free trade rules. (EurActiv)
Are we there yet? – Average CO2 emissions from new vehicles sold in the EU were well below their 2017 target, according to final data published Thursday by the European Environment Agency. However, for the first time emissions from new passenger cars rose year-on-year, though the decreasing trend continued for vans. Average CO2 from new cars sold in 2017 was 118.5 grams/km, which was 0.4 g higher than 2016 but below the current target of 130 g. Since monitoring began in 2010, average CO2 from new cars in the EU has fallen by 22 g or 15.5%. Manufacturers have work to do to further reduce emissions to meet the EU target of 95 g/km before 2021. The average CO2 per new van was 156.1 g/km, or 7.5 g below 2016. Emissions will also have to be cut further to hit the 2020 EU target of 147 g/km. Also, for the first year since 2009, more petrol cars (53% of the new fleet) were sold than diesel ones (45%). New registrations of electric vehicles increased significantly in 2017, but overall they represent less than 1.5% of new car registrations (compared to 1% in 2016). Carmakers are on course to be hit with EU fines of between €2.4-11.2 billion euros for failing to meet the bloc’s 2021 goals, ratings agency Moody’s said on Thursday. (Climate Home)
Lofty ambitions – Pakistan has set itself a target of generating 60% of its energy mix from renewable sources by 2030. Half of that will be large hydro and the other half a mix of wind, solar, small hydro, and biomass. The latter category accounted for only 2% of the energy mix in 2017, EnerData reports.
Offsetting 101 – In the interest of facilitating further engagement by academic institutions, the Carbon Institute has partnered with offset exchange Cool Effect to produce a guide to help universities purchase high quality carbon credits. In the guide, the organisations describe steps to engage university communities, measure carbon footprints, find high quality carbon offset projects to support, and purchase offsets that match university missions and preferences.
Salad days – Home retail giant IKEA is preparing to serve lettuce grown in LED-powered containers outside its stores as part of efforts to improve its environmental profile. Circular or hydroponic farming is fed by nutrients extracted from organic waste, including leftovers from IKEA’s restaurants. It means the plants need no soil or pesticides, and use 90% less water and less than half of the area of conventional farming, with the LED lights to be powered by renewable energy. (Reuters)
And finally… Poo-valanche! – A massive 66 tonnes of human poo could be exposed at North America’s tallest mountain as the threat of climate change takes a disgusting turn. According to Michael Loso, a National Park Service glaciologist who’s been studying the problem of climber excrement on Alaska’s Denali, the mountain’s surface is melting at a quicker pace and the thawing ice could expose a nasty surprise. Previous generations did not have anywhere to defecate when making their way up the mountain and went where they pleased, leaving a trail of faeces all the way to the top. This changed in the 1970s to accommodate the growing numbers of hikers, where three stopping points – which included holes to do your business – were created. (Daily Express)
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