CP Daily: Wednesday February 5, 2020

Published 23:04 on February 5, 2020  /  Last updated at 23:27 on February 5, 2020  /  Newsletter  /  No Comments

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

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TOP STORY

EU power sector emissions plummet a record 12% in 2019 on huge coal output declines -report

Carbon emissions from the EU’s power sector fell by a record 120 million tonnes or 12% in 2019 thanks to a sharp decline in generation output from coal-fired plants, a report published Wednesday found.

EMEA

Brussels to set out climate law plans on Mar. 4

A law to bind the EU to a 2050 net zero emissions goal is due to be proposed by the European Commission on Mar. 4, the bloc’s executive said Wednesday, a date that was a week later than had been widely expected.

Vattenfall’s 2019 thermal power output drops as hydro levels recover

Swedish utility Vattenfall saw its fossil-based production dip 1.6% in 2019 as hydro reservoirs filled from very low levels earlier in the year, the company said in its annual results on Wednesday.

EU Market: EUAs climb towards €24 as virus cure hopes lift markets

EUAs continued their recovery on Wednesday from a four-month low hit this week, as the prospect of a breakthrough in tackling the coronavirus lifted oil and wider financial markets.

Second senior EU carbon and power analyst exits ICIS

A senior EU carbon and power analyst has left based ICIS to join Swedish utility Vattenfall, marking the second such departure from the German-headquartered analytics firm this year.

ASIA PACIFIC

South Korea ministry approves 2050 emission target well off net zero path

South Korea’s environment ministry on Wednesday finalised its proposal for the nation’s long-term emissions strategy, aiming for 40-75% cuts from 2017 levels by 2050.

Australia to offer optional offset contracts at ERF auctions

Australia will let participants in future Emissions Reduction Fund (ERF) auctions sign an optional contract that allow let them to sell contracted carbon credits to the secondary market instead if they can achieve higher prices there, in a bid to attract more participation.

NZ Market: NZUs see modest rebound as ETS reform grips sentiment

NZUs have halted last week’s slide and regained some lost ground the last two days amid limited supply and traders fixing their gaze on expectations of higher prices in the longer term.

AMERICAS

California fuel emissions through October slip under 2018 totals, as power reverses trend

California’s fuel consumption through Oct. 2019 slipped slightly below the previous year’s total, potentially resulting in stagnant ETS-covered emissions compared to 2018, state data published Wednesday suggested.

Pennsylvania GOP, fossil fuel groups claim few environmental benefits to joining RGGI

Energy industry speakers urged lawmakers on Wednesday to advance legislation that would prohibit Governor Tom Wolf (D) from joining the RGGI ETS without the General Assembly’s approval, citing the large economic impact and meagre GHG reductions from doing so.

RFS Market: RIN prices continue climbing after court decision on waivers

US biofuel credit prices continued to tick up this week after a recent federal court ruling questioned the US EPA’s granting of Renewable Fuel Standard (RFS) compliance waivers, but other factors were also thought to have added to the bullish sentiment.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Don’t bully me – Australian PM Scott Morrison vowed Wednesday he would not be bullied into taking action on climate change, adding he was listening to people from all over the country, not just those in the “inner city”. The statement came as his government is under increasing pressure to act following the catastrophic bushfires across Australia in recent months. It also followed a proposal from Liberal MP Katie Allen to appoint a dedicated minister for climate change issues – not in order to do more, but to communicate the government’s position more clearly. (Guardian)

Gimme half – Meanwhile, the South Australian state government is now aspiring to cut carbon emissions by as much as 50% below 2005 levels by 2030, according to Governor Hieu Van Le. The Liberal-led state expects to achieve the cuts by continuing to roll out new renewable energy capacity, launching an electric vehicle strategy, and developing a hydrogen programme, he said as he opened the state parliament for 2020. (RenewEconomy)

French fun facts – France’s recent industrial history may have a lesson for governments balancing climate change and economic demands: carbon taxes can cut GHG emissions and are not that bad for jobs either. Analysing 15 years of data from 8,000 French manufacturers, OECD economists found that when energy costs rise 10%, emissions decline 9%. Crucially for governments worried about the political costs of climate policies, even if carbon taxes cause job losses at individual firms, there is no net loss of employment in the sector. President Macron’s 2018 fuel tax increase sparked the yellow vest protests over the cost of living, ultimately forcing him to backtrack and implement billions of euros of tax cuts to restore calm. But according to the OECD paper, the carbon tax on French industry at €45 per tonne of CO2 meant 2018 emissions were 5% lower compared with a no-tax scenario. The net effect on jobs is much smaller and may even be positive at about 0.8%, said Damien Dussaux, lead author the OECD working paper. A further increase in carbon tax to €86 a tonne would reduce carbon emissions 8.7%, according to simulations. (Bloomberg)

Biding time – The US Department of Justice (DOJ) filed a brief late Tuesday opposing a motion by California to delay a future hearing on the government’s constitutionality challenge to the state’s ETS linkage with Quebec. The move was widely expected as the DOJ had voiced opposition in emails included in California’s filing earlier in the week. In the DOJ brief, the Trump administration argued that the US District Court for the Eastern District of California should reject California’s request to shift a future hearing to Apr. 20 because state officials had made a similar motion in December. “This court should not tolerate such manipulation of its schedule,” the DOJ wrote. California had argued that additional time was necessary because two pending motions could substantially alter the case. The DOJ offered a compromise of shifting a future Sacramento hearing from Feb. 24 to Mar. 9. There currently is no timetable for the court to rule on the issue.

Wistful for WCI? – Two of the Ontario Liberal Party’s six leadership candidates have considered bringing back a form of cap-and-trade, the National Observer reports. Candidates Brenda Hollingsworth and Alvin Tedjo both floated the idea of implementing a cap-and-trade programme, which was established by Kathleen Wynne’s former Liberal government before the Progressive Conservative administration of Premier Doug Ford abruptly cancelled the WCI-linked carbon market in summer 2018. The responses of all six candidates included sticking with the federal ‘backstop’ CO2 pricing regime, implementing a provincially-run version, and reviewing emissions data available in 2022 before deciding.

Fund fun – Revenues from New Brunswick’s proposed CO2 tax will flow into the Canadian province’s climate change fund, not be distributed back to residents as under the current federal ‘backstop’ system, Minister of Environment and Local Government Jeff Carr said Tuesday. During the inaugural meeting of the Maritime province’s Standing Committee on Climate Change and Environmental Stewardship, the Progressive Conservative party minister said the carbon revenue could go towards purposes such as adaptation plans, flood mitigation projects, and energy efficiency initiatives. Ottawa approved New Brunswick’s provincially-administered CO2 levy to start in Apr. 2020. (Global News)

And finally… Got meat beat – An EU tax on meat to cover its environmental damage could raise billions to help farmers and consumers produce and eat better food, according to a report by researchers CE Delft for the Tapp Coalition of NGOs. It estimates that covering these costs would increase the price of beef, pork and chicken by 40 UK pence (€0.47), 31p and 14p per 100g, respectively and would “increase the cost of a supermarket steak by about 25%”. (The Guardian)

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