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European carbon prices jumped to a one-month high on Monday, breaking out of their recent narrow trading range on technical buying and as energy prices extended their rebound from last week’s lows.
New speculators trimmed some length off their California Carbon Allowance (CCA) holdings over the past week, but the group’s large position remained relatively unchanged despite significant price decreases in the WCI cap-and-trade market, according to US Commodity Futures Trading Commission (CFTC) data.
California Low Carbon Fuel Standard (LCFS) prices have continued their steady increase over the month of June as compliance buying has persisted, but some participants have questioned how much further the bull run will last.
Prices for biofuel credits (RINs) under the Renewable Fuel Standard (RFS) have climbed in recent days after a news outlet reported President Trump ordered a review of the EPA’s compliance waiver programme for refiners.
Spot exchange operator CBL Markets will merge with commodity data firm Xpansiv, the companies announced on Monday.
New Zealand Climate Change Minister James Shaw has said he is “not keen” to shift the emissions trading scheme’s de facto price cap level up from the current NZ$25 level until the full market reform package is ready, the clearest indicator yet the cap will stay where it is and weigh further on NZUs.
Organisers of the 2022 Winter Olympics in Beijing have released a plan to minimise the event’s greenhouse gas footprint, including a goal to buy or ensure donations of local carbon offsets and ETS allowances to make up for any emissions that can’t be avoided.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Hiding the evidence – The Trump administration has refused to publicise dozens of government-funded studies that carry warnings about the effects of climate change, defying a long-standing practice of touting such findings by the Agriculture Department’s acclaimed in-house scientists. According to Politico, the studies range from a ground-breaking discovery that rice loses vitamins in a carbon-rich environment – a potentially serious health concern for the 600 million people world-wide whose diet consists mostly of rice – to a finding that climate change could exacerbate allergy seasons, to a warning to farmers about the reduction in quality of grasses important for raising cattle. All of these studies were peer-reviewed by scientists and cleared through the non-partisan Agricultural Research Service, one of the world’s leading sources of scientific information for farmers and consumers. None were focused on the causes of global warming, but rather they examined the wide-ranging effects of rising CO2, increasing temperatures, and volatile weather.
Don’t bother – Separately, the White House on Friday proposed that federal agencies no longer have to take a project’s long-term climate impacts into account when assessing how they will affect the environment, reversing a major Obama administration policy, the Washington Post reports. The draft guidance, issued by the White House Council on Environmental Quality (CEQ), would change the way the US government evaluates activities ranging from coal mining to gas pipelines and oil drilling by limiting the extent to which agencies can calculate their GHG emissions. In Apr. 2016, CEQ finalised a directive that agencies quantify to what extent they will contribute to climate change, a move that threw approval of those projects into doubt. Now, according to the new directive, agencies conducting reviews under the National Environmental Policy Act (NEPA) only have to calculate an action’s GHGs when “a sufficiently close causal relationship exists” between a project and greater carbon emissions. It also tells agencies they can opt not to assess a project’s climate impact if they decide it “would be overly speculative,” and they can put any projected emissions in the context of the local, regional, or national carbon output.
German pressure – German Chancellor Angela Merkel’s ruling CDU/CSU appears increasingly divided on climate policy depending on whether their constituencies are contested by the Greens or right wing ADP. Germany should bring forward its planned exit from coal generation to 2030 rather than 2038, the date agreed by a specially designated commission earlier this year, according to Bavarian CSU leader Markus Soeder. But Saxony CDU state premier Michael Kretschmer says the government should focus on implementing what it has agreed rather than set new targets. Public pressure is building, as utility RWE is counting the cost of 6,000 climate protesters that targeted its lignite mining assets and supply lines in North Rhine-Westphalia. Damage included arson attacks on vehicles but it did not impact its power output. (Clean Energy Wire, various)
Fossil fuels finale – US Democratic presidential candidate and Washington state Governor Jay Inslee on Monday unveiled his “Freedom from fossil fuels” plan, the latest installment in his climate-centred campaign pledges. The strategy includes ending tax breaks and other incentives for petroleum and coal companies, imposing a national ban on fracking, and re-imposing a ban on crude oil exports. It also calls for legislation to impose a “climate pollution fee” of an unspecified amount on various industries, as well as buying out and decommissioning fossil fuel assets. (Axios)
Left shift – Inslee’s plan comes as this week’s US Democratic presidential debates are poised to showcase just how far left the party has moved in the last several years – especially on energy and climate change. According to Axios, the Democrats’ eventual nominee is likely to be the most progressive in decades. Proposed policies could cripple oil and natural gas, direct trillions of dollars to renewable energy, and reassert US leadership abroad on climate change. It remains an open question whether most Americans would support them. Democratic candidates will appear in Miami on Wednesday and Thursday for the first two debates in the 2020 cycle.
Still missing – Oregon Republican Senators remain on the lam, hiding from law enforcement sent to round them up as the lawmakers continue to thwart a vote on the state’s cap-and-trade bill. The statehouse reopened Monday after a right-wing militia protest threat closed it over the weekend. Activists are planning a Tuesday rally outside Oregon’s statehouse in an effort to call the truant Senators back to vote on this and other bills.
Think before you tax – A properly designed revenue-neutral carbon tax can comply with US World Trade Organization (WTO) obligations, according to conservative think-tank Alliance for Market Solutions. In a new report commissioned by the group and authored by law firm Mayer Brown LLP, the analysis provides five potential approaches to designing the international features of a carbon tax and evaluates them according to the environmental impact of the tax, the impact on competitiveness, and the administrability of a carbon tax programme.
Don’t blow it, guys – The average CO2 emissions of new light-duty vehicles registered in the EU and Iceland in 2018 stayed well below the applicable targets, according to provisional data published by the European Environment Agency on Friday. However, average emissions of both new passenger cars and new vans rose YoY. Manufacturers will have to significantly reduce emissions of their fleet to meet the upcoming 2020 and 2021 targets. The data shows that the average emissions, measured in laboratory tests, of new passenger cars in 2018 were 120.4 grams of CO2 per kilometre, which is below the current target of 130 g/km. However, average emissions increased by 2 g/km compared to 2017. Average emissions from new vans was 158.1 g/km, which is below the current target of 175 g/km. For the first time, average emissions of vans increased year-to-year, rising by 2 g/km.
And finally… War of words – Seventy people were arrested outside the New York Times building in Manhattan on Saturday amid protests to call attention to how news outlets cover climate change. The action included unfurling a banner that encouraged the use of the phrase “climate emergency” instead of “climate change”. (The Guardian)
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