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Airlines are urging governments to alter the UN’s international CORSIA aviation offsetting mechanism to account for the drastic cut in flights due to the coronavirus, changes that would likely greatly reduce offset demand.
EU carbon prices stable after virus selloff, but more weakness, big emissions drop seen ahead -analyst
After cratering due to COVID-19 over the past few weeks, EU carbon prices have now stabilised and are trading at levels representative of decreased emissions demand caused by the crisis, an analyst said, estimating that figure to be around 80-100 million tonnes.
EUAs failed to hold on to midday gains above €18 on Friday but still notched a near-10% weekly rise as spiking oil prices outweighed wider market concerns over the global coronavirus epidemic.
EU member states and the UK handed out more than 54 million additional free carbon allowances to industrial emitters over the past two weeks, according to updated data released late Friday by the European Commission.
The coronavirus crisis is introducing a number of problems for South Africa and its new carbon tax, including preventing emitters from registering to pay it, experts say.
California Carbon Allowance (CCA) cratered to $12.00 on Friday morning on more brisk selling, though bargain hunters quickly brought values back close to the previous day’s settlement.
A bulk of the Q1 WCI auction volume remained in entities’ general accounts amid uncertainty in the secondary market, while regulated parties continued to deposit allowances into compliance accounts for future obligations, according to the California-Quebec programme’s Compliance Instrument Tracking Service System (CITSS) report released on Friday.
Speculators pared back their California Carbon Allowance (CCA) positions for a third straight week, as compliance entities also saw their holdings decrease amid the March contract expiry date, US Commodity Futures Trading Commission (CFTC) data showed Friday.
Washington’s Puget Sound Clean Air Agency (PSCAA) will halt approval of a low-carbon fuel standard (LCFS) for the greater Seattle area, with the potential of reevaluating the draft clean fuels programme in the future, the regional body announced Thursday.
(Updates with VCS credit usage figures) – Colombia has prolonged temporary verification requirements for domestic offsets eligible for use against the South American nation’s carbon levy as the federal government continues work on its accreditation programme for in-country projects.
Australia’s Clean Energy Regulator paid a record A$16.14/tonne in the latest Emissions Reduction Fund (ERF) auction, but volumes remained low and most of it was signed as optional contracts.
South Korean CO2 prices have not budged during the coronavirus crisis, with allowances consistently trading above 40,000 won ($32.46) despite a worsening economic outlook.
Australia’s Clean Energy Regulator this week issued 710,000 new carbon credits, a big increase from recent weeks despite agency staff mostly working from home due to the COVID-19 outbreak.
Closing prices, ranges and volumes for China’s regional pilot carbon markets this week.
Prior to the onslaught of COVID-19, a quick scan of the news each day would reveal that climate change is on the minds of customers and corporates worldwide. Warmer winters with rain where there was once snow, colder weather anomalies due to destabilization of the polar vortex, and summers punctuated by raging fires in both hemispheres make the topic impossible to ignore. And, while new regulatory regimes are cropping up across the globe, voluntary action is on the rise, writes environmental project developer Bluesource.
BITE-SIZED UPDATES FROM AROUND THE WORLD
Taking advantage – Corporate lobbying groups have been accused of “taking advantage” of the chaos caused by the coronavirus outbreak, with oil and gas groups and automotive coalitions found to have been calling for relaxed or postponed environmental regulations as a response. UK-based thinktank InfluenceMap has begun assessing lobbying that is responding to the COVID-19 crisis by calling for a rollback of climate policies. The group claims that lobbyists have been “highly active” in this chaos, namely those in carbon-intensive sectors. The oil and gas sector is the “most active” by lobbying for both financial report and deregulation of environmental policies. A new briefing paper claims that US-based think-tanks with ties to fossil fuel lobbyists including the Koch brothers are opposing green energy programmes in response to coronavirus. Groups such as the Texas Public Policy Institute and the Competitive Enterprise Institute, under the umbrella of newly formed Life:Powered project, have called for the US congress to delay and deregulate parts of the programme. Notably, the new umbrella coalition claimed that “climate change is not an immediate threat to humanity”. (edie)
Carbon plea – German business association DIHK wants the country’s non-ETS carbon pricing scheme for the transport and heating sectors to be delayed by two years to 2023 to take pressure off companies that are trying to stay afloat amid the COVID-19 outbreak. It said the expected drop in emissions this year would make further climate policy measures unnecessary for the time being, arguing that regulatory relief during a “transitional period” would help the industrial sector to cope with the virus fallout. (Clean Energy Wire)
One down, five to go – Spain submitted to the European Commission on Thursday its final National Energy and Climate Plan (NECP), three months after the deadline, and confirming that the country will ditch coal power by reducing its current capacity of nearly 8 GW to just 2 GW in 2025, ahead of a full phaseout by 2030. There are still five EU members states that have not submitted their NECPs – France, Germany, Ireland, Luxembourg and Romania, as well as exiting UK – which may all be postponing their final plans further amid the coronavirus outbreak. The Commission would, however, need the final NECPs in the coming weeks as it intends to publish its assessment of the final national strategies by June 3. (EurActiv)
Irresponsible – The Estonian Government decided to allocate €125 million in aid to the state-owned company Eesti Energia for the construction of a shale oil plant. CAN Europe called the decision “irresponsible” in light of the ongoing pandemic, Estonia’s future, and EU’s climate goals. “Much better uses could be found for this money in the current crisis – either in the healthcare sector or to support long-term economic solutions. At the moment, providing a sense of security to oil shale workers with a new oil plant is like trying to build a new hotel for those who are unemployed in the hotel industry,” said climate expert at the Estonian Fund for Nature Piret Vainsalu.
Making demands – Santos, one of Australia’s biggest oil and gas companies, is seeing a sharp increase in demand from shareholders to take more action on climate change. As many as 43% of shareholders at Friday’s annual investor meeting voted for a resolution backing a stronger emission reduction target, including Scope 3 emissions, the Sydney Morning Herald reports. No other Australian company has ever seen such strong backing for a climate resolution, which was also supported by the Australasian Centre for Corporate Responsibility.
Corona cash – The California Public Utilities Commission (CPUC) is proposing to split up residents’ twice-a-year rebate from the state’s WCI-linked cap-and-trade programme in order to offset rising utility bills during the coronavirus pandemic. The credit, ranging from about $20 to $60 based on the utility, usually appears on bills for most customers in April and October. However, with most Californians under orders to remain home during the virus pandemic, utility regulators have proposed splitting the October credit in two and moving it up to May and June, as residential electricity use has risen 15-20% in recent weeks. (Bloomberg Green)
In memoriam – New York-based utility Consolidated Edison (ConEd) has now had 170 employees test positive for COVID-19 and three perish, as electricity sector workers face mounting risks from the coronavirus pandemic. New York has become the epicentre for the virus outbreak in the US, registering nearly 103,000 positive cases and almost 3,000 deaths as of Friday. Essential employees including utility workers come into contact with the public in a variety of ways when restoring power or providing essential services during the outbreak, with Massachusetts-based utility Eversource also reporting that 12 of its employees have tested positive for COVID-19, 10 of whom are field workers. (Utility Dive)
And finally… Don’t mention the war – CO2 emissions could fall by the largest amount since World War Two this year as the coronavirus outbreak brings economies to a virtual standstill, according to the Global Carbon Project network of scientists. Network chair Rob Jackson said carbon output could fall by more than 5% year-on-year – the first dip since the 1.4% reduction that followed the financial crisis. However, experts warn that without structural change, declines caused by coronavirus could be short-lived and have little impact on the concentrations of CO2 that have accumulated in the atmosphere over decades. (Reuters)
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