CP Daily: Thursday September 5, 2019

Published 23:25 on September 5, 2019  /  Last updated at 23:25 on September 5, 2019  / Carbon Pulse /  Newsletters

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

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China’s carbon emissions up 4% despite no growth in power sector -analyst

China’s greenhouse gas emissions from fossil fuel use and cement production rose by 4% in the first six months of 2019, despite carbon output from power production standing still, analysis showed Thursday.


California ETS advisor to seek ARB input on updated allowance tracking proposal

California’s Independent Emissions Market Advisory Committee (IEMAC) will request feedback from regulator ARB before endorsing a possible metric for tracking the amount of surplus allowances in the state’s WCI-linked ETS, members said Thursday.

TCI states could release ETS design outline this month -source

Transportation and Climate Initiative (TCI) jurisdictions could release a draft carbon market design framework this month, but that document could lack substantive details, such as price levels or potential annual caps, a regulatory source told Carbon Pulse.

NA Markets: RGGI rises ahead of Q3 auction, California allowances slide on higher spread activity

RGGI allowances (RGAs) rose by double digits this week ahead of the September auction results, as California Carbon Allowance (CCA) prices dipped on the secondary market amid increased spread trading.

Washington Clean Air Rule decision could be catalyst for ETS plans -advocates

An upcoming court decision on Washington state’s blocked Clean Air Rule could spark further debate on progressing a WCI-modelled cap-and-trade bill in the legislature next year, stakeholders said.

ROUNDUP: US Democratic presidential candidate climate town hall

The crowded 2020 Democratic presidential field outlined their ideas for decarbonising the US economy on Wednesday night, with the candidates’ presentations revealing a split on carbon pricing and on when the country should hit net-zero emissions.


EU Market: EUAs steady as bullish sentiment offset by bearish pressures

European carbon prices ended little changed on Thursday, with bullish sentiment from a second consecutive auction-free day and optimism surrounding Brexit being offset by bearish economic data and energy and supply pressures.

Low-cost EU airline emissions edge up in August

Carbon emissions from two of Europe’s biggest low-cost airlines rose slightly in August, keeping both on track to record higher CO2 output and face costlier EU ETS bills this year.


Australian offset issuance drops off in quiet week

After issuing an unusually high amount of carbon credits last week, Australia’s Clean Energy Regulator this week distributed offsets to only one market participant as many project owners are holding their applications after receiving credits during the end-of-year rush in June.


Where next for EU carbon prices?

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Burial at sea – Oil majors Equinor, Shell, and Total, and their partners in the Northern Lights underground CO2 storage project off Norway’s coast, have signed preliminary agreements with big-emitting potential customers including steelmaker ArcelorMittal, Heidelberg Cement, refiner Preem, and energy firm Fortum. The deals could be crucial in securing the Norwegian government’s investment in the $800 mln, 5 Mt/year project that foresees transporting CO2 by ship to the site from 2023/2024. (Reuters)

Pricing divide – Germany’s centre-left SPD appears to be closely aligned to its centre-right CDU/CSU coalition partner on a domestic climate law due by year-end, though carbon pricing could be one key difference. Both parties support climate neutrality by 2050 and a carbon price for transport and buildings. However, while the CDU/CSU largely supports an ETS, the SPD believes this would be too complex to implement in the short-term. (Clean Energy Wire)

Phase-out one – The German government plans a first capacity auction on June 1, 2020 to cut hard coal-fired power capacity, according to a working group level draft law seen by Montel. The draft aims to transpose the report of the cross-stakeholder coal commission, which recommended phasing out by 2038.

Cash tap runs dry – The German economy ministry plans to hold tenders to remunerate hard coal plant operators for taking units off the grid early, but only until 2030, reports Tagesspiegel Background. After that date, operators would receive no compensation and hard coal plants would be shut down step-by-step according to their age, the agency reports, based on a draft law on Germany’s coal exit and talks with ministry officials. This would push even operators of younger plants to partake in the tenders to profit from the remuneration and avoid lawsuits with uncertain outcome. The draft does not discuss important decisions, such as the upper price limit for the tenders, and it does not yet cover the exit from lignite. It is supposed to be finalised for inter-ministerial coordination by the end of September. (Clean Energy Wire)

Asian ambition – Asian countries must set more ambitious climate goals to avoid their heavy and expanding reliance on coal power cancelling out global progress, said the UN’s deputy climate chief Ovais Sarmad. “Radical, transformative and highly ambitious actions need to happen at all levels – we have very little time,” he added. (Reuters)

Lagarde pitch – The ECB could not exclusively invest its €2.6 trillion portfolio in green bonds because there is not enough of a market, but if the ECB signals that it will be increasing and will be intensively looking at green bond investments then it’s also something for the market to register. That’s according to Christine Lagarde, seeking the EU Parliament’s endorsement to become the bank’s first female president. (Climate Home)

Offset market – China’s island province Hainan is planning to set up its own carbon offset market for major emitters, according to local news media (story in Chinese via CarbonVision) The plan lacks details for the time being, though it appears to be part of the provincial government’s strategy to tighten cooperation with Guangdong, Hong Kong, and Macao – an initiative that also includes the prospects of setting up an international carbon exchange.  It’s unclear who exactly would be involved in the offset market as Hainan has very little emissions-intensive industry. Its economy is among the smallest in China with a 2018 GDP of just over $70 billion, roughly the same size as Oman.

Gas spoofer – UK energy regulator Ofgem has fined Engie Global Markets £2.1 mln after one of its traders engaged in ‘spoofing’ to manipulate wholesale gas prices between June and August 2016, Bloomberg reports. Spoofing involves manipulating prices by placing bids or offers to trade with no intention of executing in order to buy or sell at a higher or lower price and increase trading profits. Engie agreed to settle early and has taken measures to prevent this happening again, Ofgem said in statement

DAC deal – Switzerland’s Climeworks and Dutch firm Antecy have joined forces to advance direct air capture (DAC) technology, or “removing climate-relevant amounts of CO2 from the atmosphere”. The two DAC companies on Thursday announced that they have been discussing a collaboration since mid-2018, and in Apr. 2019 an agreement was reached to fully merge teams, technology development, brands and business activities. Climeworks has been capturing CO2 from ambient air since 2009 and has developed a portfolio of different sorbent materials, process technology, and plant designs. Antecy has been developing non-amine based sorbent materials for CO2 capture since 2010. Antecy’s relevant assets have been acquired by Climeworks and the business activities of both Antecy and Climeworks will be conducted through Climeworks. Separately, a new report published today emphasised the need for investment and policies to support markets for the use of captured carbon. The report, by the Center for Climate and Energy Solutions (C2ES), identifies policy changes needed over the coming decade to grow a diverse mix of markets for captured CO2.

And finally… You gotta believe – A majority of Canadians in every single riding believe the climate is changing, according to The Conversation. The highest percentage is in Halifax with 93% of the public. And a majority of Canadians in all but three ridings think their province has already experienced the impacts of climate change, with Quebec coming in top at 79%. Canadians also want to see the government take the climate threat seriously, with a majority of voters supporting emissions trading. Carbon taxation is more divisive though, yet more people support carbon taxation than don’t in 88% of Canadian ridings.

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