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- Canadian election, Alberta TIER programme spur optimism for offset investors
- Germany proposes coal phaseout start next year but stays mum on EUA cancellations
- EU Market: EUAs slide to 1-mth low as German coal exit law stokes selling
- EU utilities CEZ, Uniper advance hedging amid coal power drops
- Oregon floats delaying fuel sector entrance for proposed ETS -sources
- South Korean CO2 prices could reach $45/t in 2020-21, analysts say
- NZ Market: Stationary NZUs unable to lose FPO shackles
Canada’s federal and provincial compliance offset markets have received a boost from the re-election of Prime Minister Justin Trudeau and Alberta’s proposed new emissions-cutting mechanism, but industry stakeholders believe several outstanding issues must be resolved before investment can take off.
Germany will next year begin the process of phasing out its hard coal-fired power plants, according to draft legislation, with a decision on cancelling a corresponding number of EUAs appearing to be postponed until at least 2022.
EU carbon crashed by more than a euro to a one-month low below €24 on Tuesday as bearish reactions to a lack of firm EUA cancellation plans in Germany’s coal phaseout bill triggered selling.
Utilities CEZ and Uniper advanced their hedging considerably over the third quarter, but the amount of EUA buying is likely to have been lower in absolute terms amid coal generation declines.
Oregon politicians are debating the postponement of compliance obligations for the state’s fuel sector for five years under a future WCI-aligned ETS, but it remains to be seen whether that option has support among Democrats, regulatory sources told Carbon Pulse.
South Korean CO2 allowances could climb to as high as 52,000 won ($44.71) by the latter part of next year as the market’s shortage is expected to deepen, analysts at Ecoeye said Tuesday.
NZUs remain rangebound near the NZ$25 fixed price option (FPO) level where prices have been stuck for over two months, as many buyers are reluctant to pay a premium for compliance.
BITE-SIZED UPDATES FROM AROUND THE WORLD
The darkest hour – In Australia, New South Wales and Queensland are suffering from massive bushfires that so far have claimed three lives and 150 homes. The fires are unprecedented in that they are arriving early in the season, sparking many to sound the climate change alarm. The debate is now raging over whether or not it is appropriate to discuss climate policy while people are running for their lives. But some of those that have lost their homes are asking if this isn’t the right time to talk about action on climate change, then when is? (AAP)
Credit criticism – California Attorney General Xavier Becerra has weighed in on the County of San Diego’s appeal of its blocked offset plan, arguing the jurisdiction’s strategy could undermine the state’s GHG reduction strategy. In a strongly worded amicus brief recently submitted to the 4th District Court of Appeal in San Diego, Becerra argued that the county’s offset strategy would perpetuate current sprawling development patterns, which will impede the ability of the region and state to reach their long-term climate objectives. But lawyers for San Diego County rejected that claim, arguing that the plan would help meet the states’ GHG reduction targets. A ruling on the case could come as early as spring 2020. See Carbon Pulse’s most recent article on the lawsuit between seven environmental groups and San Diego County over the offset plan. (Los Angeles Times)
Rebuffed to Regina – Saskatchewan Premier Scott Moe left Ottawa empty-handed Tuesday after his first meeting with Prime Minister Justin Trudeau after the October federal election, the Toronto Star reports. Moe, one of the loudest voices of Western provinces’ frustration with Trudeau’s Liberals, wanted a one-year reprieve for his province from the federal carbon tax, as well as changes to the federal equalisation system and a commitment from the PM to help boost Saskatchewan’s exports. Moe told reporters outside the Trudeau’s office he was “disappointed” with the meeting.
Steel solution – German steelmaker Thyssenkrupp has launched tests into the upstream use of hydrogen aimed at reducing CO2 emissions from steel production by 20%. Thyssenkrupp has set itself a 2050 target of cutting its emissions to zero, after emitting around 24 million tonnes of CO2 in the 2017-2018 fiscal year. Following the upstream conversion, the company plans to use hydrogen for its feedstock plants from the mid-2020s. (Clean Energy Wire)
Paint me a troubling picture – The US Court of Appeals for the District of Columbia on Tuesday rejected on procedural grounds trade group Advanced Biofuels Association’s (ABFA) challenge to the US EPA’s accelerated granting of compliance waivers under the Renewable Fuel Standard (RFS). In an unpublished opinion, while the court said there was no final agency action at the time the ABFA petition that would allow for a review, the judges noted the EPA’s briefing and oral argument in the case related to the RFS small refinery exemptions granted under the Trump administration “paint a troubling picture of intentionally shrouded and hidden agency law that could have left those aggrieved by the agency’s actions without a viable avenue for judicial review”.
Bourse bundle – Germany-based EEX Group and US-based Nasdaq Futures, Inc. (NFX) have successfully reached an agreement to sell NFX’s futures and options exchange business to EEX group, the companies announced in a press release Tuesday. EEX will acquire the core assets of NFX, including the portfolio of open interest in NFX contracts. The terms and details of the deal were not released. The transaction involves the transfer of existing open positions in US Power, US Natural Gas, Crude Oil, Ferrous Metals and Dry Bulk Freight futures and options contracts to EEX Group’s clearing houses Nodal Clear and European Commodity Clearing (ECC). The deal complements EEX and Nodal’s existing markets and bolsters their trade offering in the battle over US energy and emissions market share with ICE.
Race for sponsors – World-leading car race competition Formula One has pledged to become carbon neutral by 2030, making plans to cut its current scope one and two annual output of 256,000 tonnes by 20-50%, while offsetting the rest. But it is not abandoning internal combustion engines, despite owner Liberty Media’s struggles to raise sponsorship revenue while EV rival Formula E strikes several new deals. (Financial Times)
And finally… Anchor up – Swedish climate activist Greta Thunberg is heading to Madrid for next month’s COP25 climate talks, catching a ride on a catamaran with Riley Whitelum and Elayna Carausu, a YouTube celebrity couple known as Sailing La Vagabonde who live on the boat with their baby. They have heating, solar panels, and a water turbine, with the journey from Hampton, Virginia to Spain expected to take around three weeks, depending on weather. After Chile pulled out of hosting this year’s climate summit, Thunberg asked for help getting to Spain on social media, and said she got only a few responses because of the time of year. And as the teenage campaigner says goodbye to North America, she is leaving behind a simple message for those who care about the climate crisis: you must vote. “My message to the Americans is the same as to everyone – that is to unite behind the science and to act on the science,” Thunberg told the Guardian on Tuesday. “We must realise this is a crisis, and we must do what we can now to spread awareness about this and to put pressure on the people in power. And especially, the US has an election coming up soon, and it’s very important that for everyone who can vote, vote.”
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