— COMING IN FEBRUARY: Carbon Fast Forward – Manchester —
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TOP STORIES
Germany agrees plan to phase out lignite, cancel EU carbon permits
The German government has mapped out a tentative plan to phase out the country’s lignite plants, also agreeing a strategy to cancel freed up EU carbon allowances and compensate affected companies, regions, and workers.
AMERICAS
Washington state can implement Clean Air Rule on stationary sources, court rules
The Washington Department of Ecology (ECY) can enforce its market-based carbon rule on stationary emitters after the state Supreme Court partially overturned a lower court’s decision on Thursday, but the ruling still bars the agency from implementing GHG limits on fuel suppliers and natural gas distributors.
California needs to further strengthen its climate policies to reach 2030 goal -report
California’s current suite of climate policies may not reduce emissions in line with the state’s 2030 goal, but the adoption of six new or enhanced mechanisms could ensure it hits that mark, according to a report released Thursday.
NA Markets: California price drop reverses early year rally, RGGI takes off on higher demand
California Carbon Allowance (CCA) prices dropped on the secondary market after rising toward programme highs to start 2020, while RGGI Allowance (RGA) prices rose double-digits amid increased buying.
LCFS Market: California prices pull within records, BC deficit grows
California Low Carbon Fuel Standard (LCFS) prices flirted with all-time highs this week, while data showed British Columbia’s credit deficit for its own clean fuels programme rose in 2018.
ASIA PACIFIC
Korean developers lukewarm about China CDM opportunities
Major South Korean carbon project developers are dubious to opportunities in China, amid efforts to drum up Korean interest in earning carbon credits from China-based N2O projects.
EMEA
EU Market: EUAs lift above €25 as Germany confirms EUA cancellations for lignite closures
EUAs climbed above €25 for the first time this week on Thursday as auction demand continued to be strong, while Germany confirmed its emission-busting lignite phaseout and EUA cancellation plans.
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Climate and Energy Correspondent – Brussels
Carbon Pulse is looking for a Climate and Energy Correspondent to help us bolster and expand our coverage of the EU ETS and other energy and environmental markets, as well as climate and energy policy at a national, EU, and international level.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Doing Bill proud – US computer giant Microsoft has announced plans to be carbon negative by 2030 and hopes to have removed enough CO2 by 2050 to account for all the direct emissions ever spewed by the company. Microsoft wants to reach its goal to cut its carbon for its supply and value chain by more than half by 2030 through a portfolio of negative emission technologies, potentially including reforestation, soil carbon sequestration, bioenergy with CCS, and direct air capture. The company said it would fund the efforts by expanding its internal carbon fee, which it has applied since 2012 to its direct emissions, electricity use, and air travel, among other activities, to cover all Microsoft-related emissions. The company’s plan also includes the creation of a climate innovation fund that will invest $1 bln over the next four years to speed up the development of carbon removal technology. (The Guardian)
Clean cash jump – Global green bond and loan issuance climbed 49% last year to a record high of $254.9 bln as more investors sought to raise capital to support efforts to combat climate change, an analysis by non-profit Climate Bonds Initiative (CBI) shows. The bonds still make up a small but growing fraction of the overall bond market, with CBI expecting $350-400 bln in 2020. (Reuters)
Surge success – Investment in renewable energy capacity worldwide was $282.2 billion last year, after a late surge in offshore wind financings helped 2019 investment overtake 2018 by 1%. The world’s biggest market China slipped back 8% to $83.4 bln – the lowest since 2013. The US, the second-largest market, hit a new record at $55.5 bln, up 28% on 2018, according to new figures published by BloombergNEF (BNEF).
Big benefactors – Poland and Germany will be the biggest beneficiaries of the EU’s new €100 bln Just Transition fund designed to help coal-dependent regions move towards a greener economy, European Commission data showed on Thursday, with the pair set to receive about 40% of the total. All EU countries except Poland agreed last month to aim for net zero emissions by 2050. In a attempt to get Warsaw on board, the European Commission announced the details of the fund earlier this week. (Reuters)
Cementing their plans – The European cement industry has said it will revise its GHG greenhouse gas reduction plans to become carbon neutral by 2050, in line with the EU’s European Green Deal, but said it required “more encompassing” regulation to support it. Cembureau, the association representing the sector, said on Wednesday it will publish a revised carbon reduction roadmap this spring, making a “decisive contribution” to the European Commission’s plan. The industry still expects to achieve the largest reduction through carbon capture, although the technology is only available at demonstration level at present, a spokesperson told ENDS. ($)
Bloomberg for buildings – Former New York City Mayor and US Democratic presidential candidate Michael Bloomberg unveiled a plan Wednesday for all new buildings in the country to achieve zero-carbon and “hyper-efficient” performance by 2025. According to Politico, the proposal is part of Bloomberg’s overall goal for cutting US carbon pollution economy-wide 50% by 2030 in order to hit full decarbonisation before mid-century. The clean buildings plan unveiled Wednesday prioritises low-income and middle-class minority communities, including rebates, tax credits, and low-cost financing for both appliances and building renovation. It would also set zero-carbon high-efficiency standards for new construction, while ramping up energy efficiency standards and health-related pollution restrictions. Then on Thursday, Bloomberg unveiled a plan that he claims will halve property losses and deaths from catastrophic wildfires within four years. He pledged to double the federal government’s fire budget to $10 billion a year to boost forest restoration, fire prevention, and firefighting, his campaign told Reuters.
You may proceed – Two Oregon clean energy ballot initiatives will move forward after a Marion County Judge ordered the the state to allow the measures to proceed. Judge David Leith ruled today Initiative Petitions 48 and 49 satisfy the constitutional “single-subject” requirement for initiatives and legislation. Contrary to the conclusion by Secretary of State Bev Clarno, he found the measures encompass a single subject – a transition to renewable energy power system, with labour and equity provisions included in the measures connected to that subject to guide the transition. IP’s 48 and 49 are two versions of a statewide initiative petition to require Oregon to produce all of its electricity using renewables and carbon-free sources by 2045. They also require standards for labour practices to ensure that jobs created during construction and other projects resulting from the petitions are high quality jobs. Clarno had ruled the initiative petitions violated the Oregon Constitution by addressing more than a single issue – specifically with prevailing-wage and other labour requirements for renewable energy construction projects used to comply with the 100% standard. (Renew Oregon)
Bless up – Indiana utilities may be prevented from retiring their coal plants early, or even reducing operations, unless explicitly blessed by the Trump administration under a bill introduced Wednesday by the state House of Representatives. House Bill 1414 would only allow the state’s utility regulators to permit a premature plant retirement if the utility is given a direct mandate from the federal government, excluding the US EPA. The bill also specifies a utility may not “materially and adversely affect the operation, safety, capacity, economic useful life, or any other aspect of the electric generation facility,” which policy analysts say could impact a broad array of practices that would reduce a power plant’s operations. (Utility Dive)
Let it go – Although the New York attorney general’s office spent more than three years investigating Exxon for deceiving investors over the climate risks to its business, the state will not appeal a New York Supreme Court decision that cleared Exxon of wrongdoing, Climate Liability News reports. AG Letitia James said that while she disagrees with the ruling, she believes huge strides were made in the trial, forcing Exxon to own up to climate change and its role in the global crisis. “The oil giant has never taken seriously the severe economic impact that climate change regulations will have on the company, and that truth was laid bare at trial,” James said. The trial also has also served as a roadmap of sorts for a similar but broader suit being pursued by the state of Massachusetts, experts say.
Trafigura trailblazer – Global commodities trader Trafigura is looking to take a lead in the industry to tackle climate change and will set a target to reduce the intensity of its emissions this year, the company said in its annual responsibility report. The privately-held, Geneva-based firm said it made significant strides to improve the accuracy of its GHG reporting to meet increasingly detailed data requests from banks and other stakeholders. Its total emissions rose by 26% to 8 Mt of CO2e in 2019 from 6.38 Mt in 2018, with seaborne trade accounting for 89%. Trafigura saw a sharp rise of 119% to just over 1 Mt in its Scope 1 and Scope 2 emissions largely due to the 39 ships that joined its fleet. Scope 1 includes direct emissions, while Scope 2 includes indirect ones such as electricity purchases. (Reuters)
Davos direction – Climate featured in all the top 5 positions of the World Economic Forum’s annual risks report for the first time in its 15-year history”, the think-tank said ahead of its annual meeting in Davos, Switzerland, next week. The summit is attended by the chief executives of some of the world’s biggest and powerful companies.
Carney in charge – British Prime Minister Boris Johnson has appointed outgoing Bank of England Governor Mark Carney as a key adviser for the COP26 climate talks in Glasgow this November. Johnson met today with Carney in Downing Street where he confirmed his new role as the PM’s Finance Adviser for COP26. Carney will help the UK government mobilise ambitious action from across the financial system ahead of the UK-hosted summit.
Becoming a bigger bird – San Francisco-based carbon offset start-up Wren recently raised $1.5 mln in venture capital funding to build its subscription service. The company allows users to pay a monthly fee based on their calculated carbon footprint, which then goes to funding projects around that world that would generate a corresponding reduction in their emissions. The seed round was led by Union Square Ventures, with participation from Y Combinator (YC) co-founder Paul Graham and others. (Forbes)
And finally… Fallen star – Commodity hedge fund Northlander Commodity Advisors suffered a 50.6% plunge last year, a spectacular reversal from its 2018 position as a darling of the industry. AUM at the fund run by Ulf Ek shrank to $310 mln after it posted its first annual loss since inception in 2012, according to people familiar with the matter. The fund had gained prominence on the strength of its bets on gas, power, and EU emissions, and it finished 2018 with almost $500 mln in assets. Northlander rose to fame with double-digit gains every year from 2013-18, including a 53.6% return in 2018. Despite the large loss last year, the fund has returned 83.6% since inception eight years ago. In an update memo to investors seen by Bloomberg, Ek said the firm had a “miserable end to a miserable 2019.” The fund has significantly reduced its exposure to the emissions market, where it made a large chunk of its money in 2018, he said. “We have restructured the portfolio significantly” in emissions, he wrote in the note, saying the exposure was now lower “than it has been over the last two years.” Ek told investors that he believes that carbon will climb in 2020, and said he was also bullish on coal prices.
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