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TOP STORY
UN thins Article 6 text as markets talks get underway
UN officials produced a slightly thinner new version of text for an international emissions trade rulebook under the Paris Agreement’s Article 6 on Wednesday, though negotiators showed few signs of compromise in initial exchanges.
AMERICAS
Ontario climate plan falls short on GHG targets, emitter programme -gov’t watchdog
Premier Doug Ford’s government will not meet its emission goals through its suite of environmental policies revealed last year, with Ontario’s proposed output-based pricing system (OBPS) revealed to be even weaker than previously expected, the Canadian province’s watchdog said Wednesday.
California’s difficult path to 2030 emissions goal could increase CCA volatility -analysts
Analysts expect further price volatility in the WCI-linked ETS as California’s existing suite of environmental policies is unlikely to hit the state’s long-term emissions goals.
California fuel consumption remains slightly above 2018 levels
California’s cumulative fuel consumption maintained its slight edge above last year’s levels through August, but transportation emissions are likely to remain on par with 2018, state data showed.
ASIA PACIFIC
China’s Shanxi launches forest carbon pilot programme
Shanxi has become the latest Chinese province to launch a programme for generating forest carbon credits, local media reported, a move that could see its offsets gain eligibility in the nation’s ETS and even eventually in ICAO’s CORSIA aviation scheme as part of China’s new voluntary programme.
EMEA
EU Market: EUAs rebound back towards €25 on stronger auction, energy
EUAs rose sharply on Wednesday on a much stronger auction result and a pause in energy market losses.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
COP25: Not a dealbreaker – China has added its voice to calls seeking a longer life for CDM carbon credits via a transition from the Kyoto to Paris eras. “We hope the transition of the CDM regime could be agreed on and CDM projects could be transferred to the Paris agreement,” Ma Aimin, deputy director of China’s National Center for Climate Change Strategy and International Cooperation, told reporters Wednesday at climate talks in Madrid. “It will not be a dealbreaker if they don’t transition.” Envoys at COP25 are talking about how to structure international carbon trading after 2020 as part of Paris’ Article 6, with part of those discussions focussing on how or whether to transfer CDM projects or CERs to the new post-2020 regime. “A few years back, several countries decided to withdraw their support to CDM projects in China and many have already made the transition from international projects into locally supported projects,” Ma Aimin said. On Tuesday, Brazil said envoys at the talks should find a way to revive credits generated under the CDM, as killing existing CERs would limit the private sector’s appetite for the Paris markets. (Bloomberg)
COP25: Russian roulette – Russian public apathy about climate change mirrors indifference in the Kremlin even as Russian scientists say parts of the country’s Arctic are heating up faster than anywhere else in the world, and vast swaths of Siberia were ravaged by flooding and forest fires this summer. But while President Vlaidimir Putin in September finally decided to ratify the Paris Agreement after years of foot-dragging, he says he doesn’t believe global warming is caused by human activity, and Russia isn’t making any proposals to cut its carbon output. (Bloomberg)
Gaps and shortcomings – German state energy ministers have criticised the federal government’s climate package for being full of “gaps and shortcomings” and have called for measures to ensure that renewables expansion and emissions reduction can make sufficient progress. They are urging for a “massive expansion” of onshore and offshore wind power, with “at least” 5 GW of onshore wind power capacity added every year, and the removal of the current cap on solar power support. They propose several measures to facilitate the expansion of renewable energy sources, such as a “rooftop programme” for solar power or regulatory changes to remove hurdles for wind posed by the country’s aviation authorities. Moreover, the ministers call for increasing the planned €10/tonne starting price under the country’s domestic ETS for transport and heating when it launches in 2021. “And it is not at all clear if the planned €54 billion in the government’s financing scheme will be enough,” they said, adding that the distribution of costs between the states and the federal government has to be clarified well in advance.
Workin’ like Landsvirkjun – Landsvirkjun, the national power company of Iceland – will introduce plans to become carbon neutral by 2025, RÚV reports. According to Hörður Árnarson, CEO of Landsvirkjun, the company has monitored its GHGs closely over the past 10 years. Landsvirkjun’s initiative forms a part of the government’s plans to become carbon neutral by 2040. Árnason said Landsvirkjun’s emissions have halved from 2005, when they were approximately 45,000 tonnes per year. Most of its current emissions can be traced to geothermal power stations.
Banking limits – Christine Lagarde has called the fight against climate change “mission critical” for the European Central Bank but she will struggle to match those words because the bank’s narrowly defined mandate of fighting inflation will limit what it can actually do. (Reuters)
See you in ’22 – Canadian Environment Minister Jonathan Wilkinson says there will be no decision made about hiking the national backstop carbon price beyond $50 a tonne for at least another two years. Wilkinson says Canada must get much more aggressive in cutting GHGs, but any increases to the carbon price won’t be decided until after the promised review is completed in 2022. He said his priority as the new minister in charge of Canada’s climate action plan is to figure out how Canada will hit its 2030 target of a 30% cut on 2005 levels. After that, he will turn his attention to addressing a Liberal election promise to exceed the target. Wilkinson will go to the COP25 next week to say Canada will live up to that promise, but specifics about how it will get there won’t likely be revealed until the fall of 2020. (Canadian Press)
The Moody blues – Alberta’s credit rating was downgraded to Aa1 negative from Aa2 stable by Moody’s on Tuesday, with the agency citing the volatility in the Canadian province’s dependence on oil and continued fiscal pressures. The downgrade, the agency states, reflects Moody’s “opinion of a structural weakness in the provincial economy that remains concentrated and dependent on non-renewable resources.” It added that Alberta’s GHGs are the highest among Canada’s jurisdictions, and that wildfires and floods could lead to significant mitigation costs. (CBC)
Could it be true? – A comment piece by Washington Post national correspondent Philip Bump examines some of US President Donald Trump’s recent statements about climate change in the context of previous remarks he has made on the matter. While emphasising that climate change is important to him, the president explained that he had done many environmental impact statements and that clean air and water are crucial, explaining: “That’s a big part of climate change”. “As we’ve noted before, Trump instead conflates ‘climate change’ with ‘environmentalism’ broadly and embraces a distinctly 1970s-era argument for what environmentalism entails,” writes Bump, noting that clean air and water were once the key focal points of the US environmental movement, leading to some important legislation. He says Trump’s statements are accurate only with a “remarkably generous interpretation of his comments”. When viewed alongside past speeches the president has made in which he has mentioned the topic, Bump conclude there is considerable “uncertainty that Trump knows what climate change is, what it constitutes and what powers it”. (Carbon Brief)
Kud it? – White House economic adviser Larry Kudlow is developing a new plan to strengthen the US Renewable Fuel Standard’s (RFS) blending requirements after advocates complained the current proposal doesn’t do enough to compensate for waivers exempting some small refineries from the mandates. Kudlow’s involvement was described by five people familiar with the matter who asked not to be named discussing the administration’s private deliberations, according to Bloomberg. The EPA already missed its Nov. 30 statutory deadline for finalising next year’s RFS quotas as it mulls a supplementary proposal to the 2020 volumes, and will reportedly look to release them on Dec. 20.
And finally… COP shop – A grand total of 26,706 participants are registered for the Madrid COP25 summit, based on the provisional list published by the UNFCCC. That includes 13,643 people representing specific parties, 9,987 from observer organisations – such as scientists, business groups and various non-governmental organisations – and 3,076 journalists. By far the largest delegation belongs to Cote d’Ivoire, which has brought 348 people, 55 more than the second placed country – the DRC, which brought 293. Cote D’Ivoire also brought the largest delegation to COP23 in Bonn in 2017 – with 492 participants – and the fourth largest to COP24 in Katowice in 2018 with 208. Despite the US’ recent decision to start the formal process of withdrawing from Paris Agreement, its delegation for COP25 (78 people) is much larger than at COP24 (48) and its largest since the Paris COP itself in 2015 (124). It’s also 2 more than China’s 76. The EU’s delegation (125) is around 40 people larger than at COP24. On average, party delegations at COP25 are divided 60% male to 40% female, which is a slightly more equal split than at COP23 in Bonn (62%-38%) and at COP24 in Katowice (63-37%). (Carbon Brief)
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