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TOP STORY
China to end overseas investment in coal plants in major shift
China will end funding for new coal-fired power plants abroad, President Xi Jinping announced at the UN General Assembly on Tuesday, signalling a massive shift for the world’s largest public financier of overseas coal.
AMERICAS
Canadian climate policy to maintain status quo as Liberals hang onto minority govt
Canadian Prime Minister Justin Trudeau’s Liberal Party hung onto a minority government during Monday’s snap election, with more of the same for the country’s existing carbon pricing and climate policies and new announcements requiring parliamentary compromise to come into fruition.
GWSA September auction sets new all-time high as prices surge above RGGI levels
Massachusetts Global Warming Solutions Act (GWSA) allowance prices surged nearly 30% in the final auction of the 2021 compliance year, with the settlement eclipsing the most recent quarterly auction price in the Northeast US RGGI cap-and-trade programme.
California gasoline consumption edges down in July as demand narrows to 2019 levels
California gasoline demand per day declined slightly in July even as Governor Gavin Newsom (D) removed all COVID-19 restrictions, but the Golden State’s fuel consumption still narrowed against historic levels, according to federal data.
Mexican offset market struggling with supply ahead of full ETS launch
Pre-compliance carbon offset trading has started under Mexico’s pilot cap-and-trade programme, but a dearth of supply and lack of regulatory clarity are serving as headwinds for further development, a panel heard Tuesday.
VOLUNTARY
Voluntary offset taskforce names governance board, promises indigenous representation
The private sector Taskforce on Scaling Voluntary Carbon Markets (TSVCM) announced its governance body on Tuesday, adding that it was on track to deliver next year standardising tools being designed to help dramatically increase the volume of carbon credit transactions.
National oil companies join pledge to reach net zero operational emissions
Brazil’s Petrobras and Saudi Aramco have joined ten other oil and gas companies in aiming for net zero Scope 1 and 2 emissions, though the pledge did not include setting a date for when the goals would be reached.
EMEA
Euro Markets: Carbon rangebound as traders eye Wednesday options expiry
EU carbon allowances were relatively rangebound on Tuesday as the market stabilised after Monday’s volatility, with traders looking ahead to tomorrow’s expiry of the Sep-21 options contract.
RWE in line for windfall EUA profit if German coal plant closures advanced -report
German utility RWE’s early hedging of its EUA exposure for the period to 2030 may earn it significant financial rewards if the country’s coal phaseout is brought forward from its scheduled 2038 deadline, according to media reports.
ASIA PACIFIC
Japanese shipping firm buys stake in Australian offset developer
Shipping firm NYK Line has taken a minority stake in an Australian offset developer to expand its carbon credit business and gain know-how that can be used in other markets, it said Tuesday.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Carbon Pulse has teamed up with CME Group to provide its clients with regular updates on the global carbon markets. Check out these briefs for the latest insights on pressing trends and events impacting markets, published every other week. Registration required
INTERNATIONAL
Double double – The US will double its climate finance contribution to $11.4 bln a year by 2024, President Joe Biden announced at the UN General Assembly on Tuesday. During a speech at the UN in New York, Biden said his administration would work with Congress to double its April pledge of $5.7 bln and “make the US a leader in international climate finance”. The new pledge is a significant increase on previous US climate finance contributions and in line with some green groups’ demands, but does not single handedly close the global funding gap. Rich countries are thought to have missed a collective target to deliver $100 bln annually by 2020 to help vulnerable countries reduce their emissions and cope with climate impacts. (Climate Home)
VOLUNTARY
38% of the world’s largest companies have set a target for significant climate action by 2030, up 8% from last year, according to the latest report into the Fortune Global 500 from Natural Capital Partners. The report, which is the third annual analysis of the commitments to carbon neutrality, net zero, 100% renewable energy, and Science-Based Targets, found that there has been a three-fold increase in net zero targets, a 50% increase in the number of companies that have either achieved carbon neutrality or are targeting it by 2030, and a 25% increase in Science-Based Targets. But still more than 60% of companies in the Fortune Global 500 are not committed to deliver a meaningful climate milestone by 2030 the ‘Reality Check’ report found.
Turning over a new LEAF – US-headquartered Delta Air Lines and London-based professional services firm PwC on Tuesday became the latest companies to the Lowering Emissions by Accelerating Forest finance (LEAF) Coalition, which seeks to raise $1 bln in private capital for jurisdictions that reduce deforestation emissions under the Architecture for REDD+ Transactions (ART) programme. The coalition, launched at the Leaders Climate Summit in April with initial participation from the governments of Norway, the UK, and the US, now counts 12 private sector entities among its participants. In a press release, the coalition said participants are aiming to announce the first set of results-based payment agreements by year-end.
Bezos billion – Amazon founder Jeff Bezos has pledged to give away $1 bln in grants this year to focus on efforts around conservation. The pledge is a part of his previously announced the Bezos Earth Fund, which the Amazon founder started last year to execute his $10 bln commitment to fund scientists, activists, and non-profit organisations in the fight against climate change. (Reuters)
High Express-tations – Global payments company American Express on Tuesday announced it has committed to net zero emissions by 2035, and will follow the Science Based Targets initiative methodology to set goals over the coming two years for its global operations and supply chain. American Express will also join the ‘Business Ambition for 1.5C’ commitment and Race to Zero, and will provide at least $10 mln in new philanthropic funding towards organisations and initiatives that drive action on climate change through 2025. In a press release, the company said it is also setting goals to enhance the management of climate-related risks and opportunities across its business and pilot low-carbon product innovations, including solutions to track and offset emissions by 2022.
Agri addition – Carbon offset management company AgriCapture on Tuesday announced it has listed its nearly 21,000-ha project with offset registry Climate Action Reserve’s soil enrichment protocol. After collecting data on 888 tracts of farmland over 2018-21, the initial project will quantify, monitor, report, and verify climate-friendly agricultural practices on these row-crop acres. AgriCapture will also continue to add additional acres to the project.
That’s life – UK-based Standard Life Investments Property Income Trust announced it has purchased over 1,400 ha of upland rough grazing and open moorland in the Cairngorm national park for £7.5 mln. The company said it is not investing in commercial forestry, but is acquiring a “gold standard carbon offset” at a fixed price, and that the purchase forms part of a wider strategy to achieve net zero emissions on the trust, based primarily on reducing operational carbon at the investment property assets with offsets for residual carbon that cannot be eliminated. (ESG Clarity)
EMEA
Bond bind – Europe’s green taxonomy effort from next year to prod investors to the front lines of the climate change fight is hitting a snag: confusion over how to treat $15 trillion of central government debt, the biggest slice of the bond market. The taxonomy doesn’t address government services, leaving the regulators to debate whether the final disclosure requirement should exclude sovereign bonds from the outset. (Bloomberg)
Gilty pleasure – Britain sold £10 bln of its first ‘green’ government bond on Tuesday after attracting over £100 bln ($137 bln) of demand from investors, a record high. Proceeds from the sale of the ‘gilts’ will be ring-fenced for projects such as clean energy. Britain has lagged behind other European countries such as Germany, Italy, and Spain in issuing this type of debt, partly because of concern that investors would want higher interest rates to compensate for a relative lack of liquidity. But the activity represents the largest single sale by a sovereign issuer. (Reuters)
Green flag, green debt – Saudi Arabia’s $430 bln sovereign wealth fund plans to announce its first green debt issuance as it looks to increase the role that ESG principles play in its investments. The Public Investment Fund will announce the green issuance “very soon,” Governor Yasir Al-Rumayyan said in a virtual event on Tuesday. The PIF, as the fund is known, is also working with BlackRock on developing an ESG framework, said Al-Rumayyan, who is also chairman of Saudi Aramco, the world’s biggest oil company. A green borrowing by the PIF would be the first for a sovereign wealth fund and comes as the kingdom, one of the world’s largest oil exporters, looks to reshape its reputation on environmental issues. The government is set to announce details of its own environmental plans at a conference next month. (Bloomberg)
Green planning – Russian Prime Minister Mikhail Mishustin underscored the importance of preparing the country for a fossil fuel phase down, committing to develop an economic plan that aligns to a global clean energy transition. “The world economy is aimed at a gradual transition to low-carbon energy, and this is already a new reality,” Mishustin said at a meeting with the deputy prime ministers on Monday. “It is necessary to prepare for a step-by-step reduction in the use of traditional fuels: oil, gas, coal,” he added while announcing that the government will develop and approve a related action plan by the end of the year. The plan will be based on an economic forecast that builds-in falling global fossil fuel demand to the principle scenario, and will help Russian government decision-makers assess related opportunities and risks through 2050. (TASS)
Christmas is saved! – British Business Secretary Kwasi Kwarteng today announced an agreement with CF Fertilisers to ensure the continued supply of CO2 to UK businesses. The exceptional short-term arrangement with CF Fertilisers – the details of which were not revealed – will allow the company to immediately restart operations and produce CO2 at its Billingham plant. The government will provide limited financial support for CF Fertilisers’ operating costs for three weeks while the CO2 market adapts to global gas prices. CF Fertilisers produces around 60% of UK’s CO2, used primarily by the food sector. The company closed two of its plants last week in response to soaring gas costs.
AMERICAS
Texas-sized deal – Royal Dutch Shell and ConocoPhillips announced a $9.7 bln cash deal on Monday for 225,000 acres (91,500 ha) in the oil-rich Permian Basin in West Texas, with ConocoPhillips also unveiling a 2030 GHG emissions intensity reduction goal for Scope 1 and 2 emissions of 40-50% below a 2016 baseline on a net equity and gross operated basis. In its announcement, Conoco said the deal would bring “more low GHG intensity barrels” into the company’s mix, and the deal would meet all the objectives of its climate mandate.
Look sharp – EDP Renewables and pipeline company TC Energy on Monday announced they have executed a 15-year power purchase agreement for 100% of the output of the 297MW Sharp Hills Wind Farm in Alberta. TC Energy will receive all environmental attributes from the project, which is slated for completion in 2023.
ASIA PACIFIC
Net zero bid – Philippines geothermal energy major Energy Development Corp. has announced the launch of a multi-sectoral movement aimed at attaining net zero carbon emissions among businesses in the Philippines, thinkgeoenergy reports. The Net Zero Carbon program is strategically developed to provide partners with a roadmap to attain carbon neutrality through the sharing of best practices and scaling up of carbon emission offsetting and tracking, as well as assistance in obtaining third-party certification of carbon emissions and offsets, and access to “green” financing. EDC’s guidance will be based on its experience as a carbon negative company through its 100% renewables operations and protection and restoration of the forests within its geothermal project sites. With EDC’s established de-carbonisation mechanisms, partners can adopt these practices and leverage them toward carbon offsetting and sequestration. EDC is the country’s biggest renewables company that accounts for over 40% of the Philippines’ renewables output and serves about 10% of the country’s overall electricity demand with installed capacity of 1,500 MW. Its 1,181MW geothermal portfolio accounts for 62% of the country’s total installed geothermal capacity.
AND FINALLY…
Idiots of the past – US Special Presidential Envoy on Climate John Kerry called out former President Donald Trump on Tuesday during a New York Climate Week event, saying “sheer idiocy and lack of scientific rationale” led to the past administration to pull out of the Paris Agreement. However, he refused to believe the damage done was irreparable. Instead, Kerry said the impacts of climate change are becoming more tangible, and the world has less time to prevent long-term impacts for global warming. (CNBC)
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