CP Daily: Tuesday October 1, 2019

Published 00:18 on October 2, 2019  /  Last updated at 00:28 on October 2, 2019  /  Newsletter  /  No Comments

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

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TOP STORY

China flags tough coal power standards in draft ETS allocation plan

China has released a draft allocation plan for its power sector emissions trading scheme trial run, proposing strict efficiency levels for coal-fired plants that analysts say would force changes at old, inefficient facilities despite the lack of an overall CO2 cap for the market.

AMERICAS

TCI jurisdictions targeting spring 2020 cut-off for ETS participation

The Transportation and Climate Initiative (TCI) is aiming for member jurisdictions to commit by spring 2020 to develop a regional cap-and-invest programme for the US Northeast and Mid-Atlantic region, while planning to auction off nearly all carbon allowances in the future ETS.

ANALYSIS: California offset demand weakens as allowance prices dip

California Carbon Offset (CCO) demand has retraced on the secondary market following the slide in WCI allowance prices after the May auction, removing some incentives for compliance entities to procure credits early.

Mexico publishes final regulation for pilot carbon market

The Mexican environment ministry (SEMARNAT) published a final regulation for its pilot cap-and-trade programme on Tuesday, with the agency yet to determine the market’s annual CO2 caps and free allowance totals for the Jan. 2020 start date.

California sets November meeting to adopt LCFS price cap, borrowed credits mechanism

California regulator ARB will hold a meeting on Nov. 21 to consider amendments to install a price cap and a borrowed credits mechanism in the state’s low-carbon fuel standard (LCFS) in response to concerns about cost containment.

EMEA

Brussels prepares to take fresh look at carbon border measures

EU lawmakers are prepared to examine with fresh eyes whether to deploy the carbon border measures they once rejected, as the bloc’s higher carbon prices and escalating international trade conflicts raise the stakes.

EU Market: After plumbing 4-mth low, EUAs rebound back above €25

European carbon prices climbed back above €25 on Tuesday, spurred by bargain-hunting buyers, after plumbing a new four-month low earlier on carry-through selling following yesterday’s late technical sell-off.

Air France to offset all domestic flight emissions from 2020

Air France will from next year offset the emissions from all of its nearly 500 daily domestic flights, the airline’s CEO announced late Monday.

INTERNATIONAL

EZ does it: Declining CO2 price trajectory necessary to counter climate uncertainty -study

Carbon prices should start high and decline over time to combat the environmental and economic cost of long-term inaction, according to research published Tuesday, advocating turning the conventional approach on its head.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Shutting down coal – China will shut down 8.66 MW worth of obsolete coal-fired generation capacity by the end of the year, according to the National Energy Administration. The move is part of China’s strategy to make its domestic coal production more efficient, though with some 200 MW of new capacity under construction it is unclear how much it will help. (Reuters)

Carbon cash – The German government expects CO2 pricing in the buildings and transport sectors to bring in €18.8 billion by 2023 for its climate action package, writes business daily Handelsblatt. Finance minister Olaf Scholz wants to ensure the package’s implementation through a supplementary budget to be approved by the federal cabinet on Oct. 2. A main part of the draft budget, seen by Clean Energy Wire, is an economic plan for the country’s Energy and Climate Fund, which is set to grow from €6.1 bln this year to €11.75 bln in 2023. EU ETS allowance sales are expected to raise an additional €14 billion, according to the draft. In all, the German government’s climate package decided on Sep. 20 is estimated to raise a total €54.4 bln between 2020 and 2023, while not incurring any new debt.

Carbon tariffs – Separately, Germany’s ruling Christian Democrats (CDU) want to examine “border adjustment measures” to avoid carbon leakage in case a global CO2 price cannot be agreed quickly, the party leadership said in a resolution for its national conference on Nov. 22-23 in Leipzig. The CDU stopped short of explicitly calling for a carbon border tax, which European Commission President-elect Ursula von der Leyen has said she plans to introduce. France has long called for such a tax and the French and German governments announced they support looking into it after joint consultations in September. A spokesperson this week said that before the German government would decide a position on such a tax “various questions of climate policy, trade policy, commercial law [and] practicability” have to be addressed. (Clean Energy Wire)

Well I’ll be Dan’d – President Trump on Monday night tapped James Danly, general counsel for the US Federal Energy Regulatory Commission (FERC), for the open Republican seat at the agency. Trump did not name a Democrat to fill the open seat left by Cheryl LaFleur, bucking the decades-old tradition of pairing Republican and Democrat nominees. If confirmed, Danly would further tilt the makeup of the commission, bringing it to three Republicans and one Democratic commissioner. (Politico)

Man the mangroves – Australia’s mangroves, tidal marshes, and seagrass meadows are absorbing about 20 MtCO2 every year, according to a major new study that is the first to measure in detail the climate benefits of the coastal ecosystems. But the study, published in the journal Nature Communications, warns that degradation of these “vegetated coastal ecosystems” was already seeing 3 MtCO2 per year being released back into the atmosphere. The study reveals Australia’s vast coastlines represent between 5% and 11% of all the so called “blue carbon” locked up in mangroves, seagrasses, and tidal marshes globally. (Guardian)

And finally… Close the loop – Thousands of ships are using devices that enable them to cheat on emissions measurements by dumping pollution directly into the ocean, the Independent reports. According to the report, global shipping companies have spent more than $12 billion outfitting more than 3,750 ships with open-loop scrubber devices, which extract sulphur from ship exhaust and expel it into the sea. The International Council on Clean Transportation estimates that for every tonne of fuel burned, each ship creates around 45 tonnes of contaminated, acidic ocean water, filled with carcinogens and heavy metals. “Imagine how far $12bn could have gone if it was applied towards developing and deploying technologies for zero-emission vessels,” ICCT researcher Bryan Comer said. “Worse, scrubbers increase fuel consumption by about 2%, increasing carbon dioxide emissions.” (Climate Nexus)

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