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EU ETS emissions could be 24.4% lower than previous projections in 2020 because of the impact of the coronavirus, according to ICIS analysts’ preliminary assessment of the sweeping changes occurring as governments take drastic measures to contain the deadly bug.
Speculators slashed their California Carbon Allowance (CCA) holdings for the second consecutive week as several firms were forced to liquidate positions amid fears of a global recession and spreading coronavirus pandemic, according to US Commodity Futures Trading Commission (CFTC) data.
The California Independent System Operator (CAISO) is seeing a reduction in power usage due to the statewide shelter-in-place order announced last week to combat the coronavirus outbreak, likely cutting entities’ compliance obligations for the sector in the WCI-linked ETS.
Manitoba will delay the introduction of its proposed flat carbon levy and large emitter programme as the COVID-19 outbreak has caused the Canadian province to reassess its financial situation, Premier Brian Pallister said Thursday.
The US EPA on Friday afternoon postponed next week’s deadline for small refineries to surrender biofuel credits against their Renewable Fuel Standard (RFS) obligations in light of the COVID-19 pandemic, while also addressing a recent court decision on the policy’s compliance waiver programme.
Australia’s Clean Energy Regulator this week issued its second-ever batch of carbon credits to a soil carbon project and registered two others, while the overall number of new offsets and deliveries to the ERF fell.
Woodside Energy will defer until next year investment decisions on three major LNG projects in Western Australia, for which the company has said it expects to have to buy tens of millions of carbon offsets over the next few decades.
Closing prices, ranges and volumes for China’s regional pilot carbon markets this week.
EUAs slipped back below €17 on Friday to notch a slight weekly gain as markets fretted that the spiralling coronavirus was eclipsing any government efforts to stimulate economies.
BITE-SIZED UPDATES FROM AROUND THE WORLD
Grey linings – The drop off in greenhouse gases due to the worldwide coronavirus lockdown might seem a silver lining to what is an extremely dark cloud. But that would depend on their being sustained when things return to normal. Unfortunately, not only is that unlikely to happen, but the response to the crisis could easily make things worse. While global emissions dropped during the recent global recession, a subsequent rise in emissions occurred due to the rapid growth in certain large emerging economies, notably those of China and India and stimulus packages deliberately intended to promote carbon-intensive areas of business, such as construction. (The Economist)
All aboard – The European Commission will deliver its proposal to include shipping emissions to the EU ETS in 2021, the EU’s executive stated in a consultation for greening the maritime sector launched on Friday. Besides extending the scope of its carbon market to include ships, the EU is set to present a proposal for a directive to promote the uptake of sustainable fuels in the shipping sector. The EU’s system for monitoring, reporting and verifying emissions from ships is currently under discussion in the European Parliament, with a resolution to be adopted this summer, although analysts agree that EU member states will be a stumbling block when raising the ambition for the maritime sector. Check Carbon Pulse’s briefing on the EU’s MRV regulation for ships.
Equinor exit – Norwegian oil major Equinor on Friday said it’s leaving the industry grade group Independent Petroleum Association of America due to differences over climate policy. Equinor cited the group’s lack of support for the Paris Agreement and carbon pricing, though the company said it will stay in the influential American Petroleum Institute despite “some misalignment” on climate. (Axios)
Cut correlation – The rise of primary energy use and CO2 emissions over four decades across 70 countries is not closely correlated with increases in life expectancy, a new study finds, suggesting that increased fossil fuel use is not a key determinant of increased life expectancy. The analysis, published in the journal Environmental Research Letters, found that greater access to electricity in the home was much more closely associated with a longer life expectancy. However, increases in access to home electricity were not highly correlated with increases in CO2 emissions, the study notes – suggesting that fossil fuels are not fundamental to access. (Carbon Brief)
And finally… Virus vacation – The US EPA issued a sweeping suspension of its enforcement of environmental laws Thursday, telling companies they would not need to meet environmental standards during the coronavirus outbreak. The temporary policy, for which the EPA has set no end date, would allow any number of industries to skirt environmental laws, with the agency saying it will not “seek penalties for noncompliance with routine monitoring and reporting obligations.” However, an Obama-era agency official and environmental groups castigated the EPA’s move, calling it a moratorium on enforcing the nation’s environmental laws and an abdication of the agency’s duty. That culminated in EPA chief Andrew Wheeler labelling The New York Times’ article on the suspension as “FAKE NEWS” and misleading the public. (The Hill)
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