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TOP STORY

FEATURE: Redirecting emissions – why so much of the EU’s carbon cash is funding CCUS

Carbon capture, storage, and utilisation (CCUS) projects have taken the lion’s share of grants awarded by the EUs flagship decarbonisation fund so far, raising concerns as to whether one technology should be receiving such a high share of carbon revenue funding ahead of other clean energy initiatives.

EMEA

EUA push to €100 reflects fundamentals as well as speculative activity -observers

The current EUA price rise towards €100 reflects a variety of fundamental factors as much as it does speculative activity, but the rally seems unlikely to attract the attention of politicians as previous price spikes have done, according to a senior market participant.

Euro Markets: EUAs rally for third day as funds continue to build net long position

European carbon extended its rally for a third day, pushing the week-to-date’s gains to 4.7% as traders continued to back up bullish sentiment with steady buying in relatively low volume, while energy prices were mixed as the current cold snap was forecast to end this week, and concerns grew for French nuclear reliability.

UK govt selects London consultancy to evaluate first phase of ETS

The UK government has awarded a £737,000 tender contract to a London-based consultancy to evaluate the first phase of the country’s domestic cap-and-trade scheme.

ASIA PACIFIC

Korean trade group to build voluntary marketplace in H2 -media

South Korea’s major trade group plans to establish a voluntary carbon market (VCM) trading platform, which will be launched in the second half of this year at the earliest as a supplement to the domestic mandatory emissions trading scheme, local media reported.

SK Market: KAU auction fails to sell out again, as 2023 outlook bleak

South Korea on Wednesday sold fewer than 70% of the allowances on offer in its monthly CO2 permit auction amid dwindling buy interest, which observers expect to be sustained this year despite a possible rebound in the country’s emissions.

Malaysia to inject over $2 mln to kickstart carbon market, PM says

The Malaysian government will commit RM10 million ($2.2 mln) to help kickstart the country’s newly-formed carbon market by providing finance for local projects that generate carbon credits, Prime Minister Anwar Ibrahim announced at a conference in Kuala Lumpur on Wednesday.

Australia scientific agency launches A$20 mln CDR programme

Australia’s peak scientific body has launched a A$20 million ($13 mln) research programme to develop new and innovative ways to remove carbon from the atmosphere and permanently lock it away.

AMERICAS

California compliance offset generation drops by more than half from prior issuance

California reduced the number of offsets minted over the past two weeks by over 60% compared to its prior issuance, with the share of credits with direct environmental benefits to the state (DEBs) also trending lower, data from regulator ARB published Wednesday showed.

LCFS Market: California credits withstand voluminous PG&E auction, as another CCO project seeks fuel pathway

California Low Carbon Fuel Standard (LCFS) prices ticked up this week despite utility Pacific Gas & Electric holding a massive auction, while a dairy digester in the state applied to generate credits under the transportation sector programme instead of the compliance offset market.

VOLUNTARY

Mexican offset platform to kick start launch with pre-sale from unique blue carbon project

A new offset platform for Mexican nature-based projects is set to commence pre-selling credits from a blue carbon project, before greatly expanding its portfolio over the coming year.

BIODIVERSITY (FREE TO READ)

On track for initial goals, $1-bln conservation fund launches incubation offshoot

The Rimba Collective is on course to deliver $1 billion for private sector-enabled forest protection and restoration to more than 500,000 hectares in Southeast Asia and is launching an incubation vehicle to kickstart projects to go beyond that, a conference heard this week.

Impact fund, Kenyan bank team up to drive biodiversity, climate friendly agriculture in sub-Saharan Africa

Luxembourg-based eco.business Fund and Kenya’s Absa Bank have signed a $10-million financing deal for sustainable agriculture in the East African country, with a view to expanding their cooperation across the sub-Saharan region.

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CONFERENCES

Argus Asia Carbon Conference – Mar. 14-16, Sarawak, Malaysia: Organised by Argus Media in collaboration with the Ministry of Energy and Environmental Sustainability Sarawak (MEESty), and with host sponsor Samling Group, the Asia Carbon Conference will take place on Mar. 14-16 in Kuching, Sarawak, Malaysia. Join us for the first industry leadership conference for carbon offsetting and trading in Asia to get ahead of your competitors in a rapidly growing global market. This is your opportunity to interact, learn, and network, for the answers you need on fundamental questions about carbon offsets: how do they work, and how might they impact Asia? Find out more

North American Carbon World (NACW) 2023 – Mar. 21-23, Anaheim: For 20 years, the NACW conference has been the place for carbon professionals working in North American carbon markets and climate policy to learn, collaborate, and network. Taking place Mar. 21-23 in Anaheim, California, NACW 2023 will dive into new policies and developments that will shape and scale carbon markets and climate solutions with integrity, ambition, and equity. Register now to gain actionable insights for bold climate solutions and participate in premier networking opportunities with an active and engaged audience to strengthen your organization’s strategy for navigating the carbon landscape.

European Climate Summit (ECS 2023) – Mar. 28-30, Lisbon: Registration for the 5th edition of the European Climate Summit organised by IETA and partners is open. The ECS brings together leading private sector experts and policymakers from both the carbon and energy world, to analyse and discuss the current developments and pressing challenges. The summit provides a discussion and networking forum for policymakers, business leaders, and innovators involved in building, scaling, and collaborating on markets for net zero. The event will feature high-level plenaries, cross-cutting deep dives, interactive side events, and quality networking opportunities. Registration here

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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

Climate stalemate – US climate envoy John Kerry told Axios his work with China has stalled amid wider tensions between the world’s two largest GHG emitters. “Regrettably, in the last year … what was not supposed to happen has happened, which is the climate issue has gotten mixed up into all the other tensions that exist between our countries,” Kerry said in an interview at the CERAWeek conference by S&P Global. “And so they’ve kind of pulled back a little bit, expressing the feeling that all we’re doing is bashing them and bashing them,” he said. The two countries made a surprise joint declaration on climate ambition in late 2021, but the relationship – already tense – has deteriorated after China’s anger at then-House Speaker Nancy Pelosi’s visit to Taiwan and, more recently, the Chinese spy balloon incident.

CCS collaboration – Chevron New Energies, a division of Chevron USA, and JERA announced Tuesday that they have signed an MOU that provides a framework for their collaboration on CCS projects located in the US and Australia. This MOU has the potential to expand the significant LNG relationship that Chevron and JERA have today, and further demonstrates the commitment and dedication both companies have to advancing lower carbon solutions. The MOU furthers the collaboration between the companies in the lower carbon space, following the Nov. 2022 announcement of their collaboration on the potential co-development of lower carbon fuel in Australia and the study of liquid organic hydrogen carriers (LOHC) in the US.

AMERICAS

Canada climate risk reporting – Canada’s financial industry regulator published a set of guidelines for banks, insurance companies, and other regulated firms to assess and disclose climate risks. Financial firms will need to release climate-related financial disclosures at least once a year, the guidance from the Office of the Superintendent of Financial Institutions said. The principles come into effect at the end of fiscal 2024 for larger banks and insurers and in 2025 for smaller firms, the regulator said in a statement. The Canadian regulator is going ahead with its first climate framework as global financial bodies raise pressure on the industry to prepare for the risks associated with global warming. Banks must make assessments of clients’ environmental risks a part of their credit-granting process, the Basel Committee on Banking Supervision said in December. (Bloomberg)

Disposed to disclose – Nearly all US public companies may begin complying with the Securities and Exchange Commission’s (SEC) upcoming climate-related disclosure rules regardless of when they become law, yet most companies admit that they face technology, staffing, and budget challenges in meeting the rules’ requirements, according to a new survey by global professional services firm PwC and business data and reporting solutions provider Workiva. For the study, PwC and Workiva commissioned a survey of 300 senior-level corporate executives at US-based public companies with at least $500 mln in revenues. The SEC released its proposed climate disclosure rules in Mar. 2022, which would require US companies to provide information on climate risks facing their businesses, and plans to address those risks, along with metrics detailing the companies’ operational climate footprint, and in some cases emissions emanating across their value chains. With nearly 15,000 comments received on the proposals, the release of the finalised rules has been delayed, and are now scheduled to be released in April, with adjustments expected. (ESG Today)

Hydrogen demo plant – Hydrogen production has commenced at the nation’s first 1 MW demonstration scale, nuclear-powered clean hydrogen production facility at Constellation’s Nine Mile Point Nuclear Plant in Oswego, New York, an advancement that will help demonstrate the potential for hydrogen to power a clean economy, according to a company announcement. When produced at scale, clean hydrogen can be used to make next-generation energy for otherwise hard-to-decarbonise industries like aviation, long haul transportation, steelmaking, and agriculture. Last year, the US Department of Energy approved moving forward with construction and installation of an electrolyser system at Nine Mile Point with an award of $5.8 mln. The clean Hydrogen Generation System operating at Nine Mile Point uses 1.25 MW of zero-carbon energy per hour to produce 560 kilograms of clean hydrogen per day, more than enough to meet the plant’s operational hydrogen use. It will also help set the stage for possible large-scale deployments at other clean energy centers in Constellation’s fleet that would couple clean hydrogen production with storage and other on-site uses.

NJ offshore wind – The New Jersey Board of Public Utilities (NJBPU) has given the green light on the state’s third solicitation of offshore wind capacity. This third solicitation seeks to award between 1.2 GW and 4 GW of offshore wind capacity, building on the previously awarded 3.75 GW. The application window opened on 6 March and bids will be accepted by 23 June. NJBPU anticipates making a decision on the submitted applications by the end of 2023. This represents a significant milestone toward achieving Governor Phil Murphy’s (D) goal of 11 GW of offshore wind energy in New Jersey by 2040, which could power 3.2 mln homes with renewable energy, NJBPU said. (Offshore WIND)

EMEA

In the pipeline – Ukraine has denied any involvement in September’s attack on the Nord Stream pipelines, which were built to carry Russian natural gas to Germany, the BBC reports. The denial follows reporting across several media outlets which cites anonymous US intelligence officials who suggest a pro-Ukrainian group was to blame. Mykhailo Podolyak, an adviser to the Ukrainian president, said Ukraine “was absolutely not involved”. Moscow questioned how the US could make assumptions without an investigation. Russia has blamed the Ukraine and its allies for the explosions and called on the UN Security Council to independently investigate them. German investigators said they had searched a ship in January which was suspected of transporting the explosives used to sabotage the gas pipelines. There was at this stage no evidence to suggest a foreign state was involved, they said. The methane emissions from the pipeline sabotage has been estimated to stand at the equivalent of the annual GHGs of a medium-sized country.

Greve danger – Up to 1.3 mln people took to the streets across France to protest proposed forms to state pensions in the country, with unions in the energy sector threatening to bring the country to a standstill, EurActiv reports. The energy sector, which is at the protests’ helm, is promising the government a “hell week” due to ‘les greves’, with workers across all nuclear plants voted in favour of continuous rolling strikes for the whole of this week. Electricity production was down 5 GW over the weekend. Meanwhile, oil firm TotalEnergies’ fuel distribution plants also announced blockages would roll over to Wednesday, according to trade union officials. The company made it clear that there were no fuel shortages in sight for the time being. At the same time, France’s four LNG terminals announced they would stop all activity until March 13, while workers in all 14 gas storage facilities will vote on whether to remain closed on a daily basis. The energy sector overall has said it might not get the energy supply it needs to function appropriately. Protestors are against raising the legal retirement age from 62 to 64, which it deems to have unequal effects across society. Italy, Spain, the UK, and Germany all have retirement ages of 65 or above.

Cough up for peatlands – A UK tech startup that is targeting peatland restoration, including creating a new standard, is turning to crowdfunding to finance development. ClimaFi is currently in pre-registration on the Seedrs crowdfunding site with an aim to go public on Mar. 22 and raise between £400,000 and £750,000. The year-old company plans to build a range of satellite, artificial intelligence and blockchain tools, including a carbon credits trading platform, a new peatland restoration standard and a data aggregation platform for monitoring the success of restorations. “Our aim is to help restore the stock of degraded peatlands around the world,” said founder Tim De Rosen. “Peatlands are amazing carbon sinks when in a pristine state and are capable of absorbing over twice as much C02 as all the world’s forests, combined. Regrettably, 80% of the world’s peatlands are in a degraded state.”

ASIA PACIFIC

E-methane to go – Japanese gas distributor Osaka Gas and Australian independent Santos plan to produce e-methane from green hydrogen in Australia and export it to Japan from 2030, Argus Media reports. Osaka Gas and Santos will build facilities to produce green hydrogen and e-methane as part of the project. The plan is to ship 60,000 tonnes per year of e-methane from an existing LNG export terminal in Australia. The synthetic methane is to be produced from carbon-free hydrogen and CO2 that is captured from local factories and natural gas liquefaction plants. The companies will look into things like procurement of renewable energy and CO2, as well as a location for the facility, from April, aiming for a basic design of the project in 2024, an investment decision in 2025 and eventually exports to start in 2030.

CCS to go – Pertamina and Chevron have signed a Joint Study Agreement (JSA) to examine the feasibility of carbon capture storage and carbon capture utilisation and storage (CCS/CCUS) in East Kalimantan, Indonesia, Hydrocarbon Engineering reports. The agreement was signed on the sidelines of oil and gas industry conference, CERAWeek 2023, and is the second joint study agreement to come from the collaboration between Chevron and Pertamina that was announced in Washington, DC, in May 2022, to explore potential lower carbon business opportunities in Indonesia. The first was in November between Chevron, Pertamina Power Indonesia, and Keppel Infrastructure, and was aimed at exploring the development of selected green hydrogen and green ammonia projects using renewable energy in Indonesia. Meanwhile, Chevron also signed a Memorandum of Understanding (MoU) with Japanese power company Jera that provides a framework for their collaboration on carbon capture and storage (CCS) projects located in the US and Australia, according to a press release from the US company. This MoU furthers the collaboration between the companies in the lower carbon space, following the November announcement of their collaboration on the potential co-development of lower carbon fuel in Australia and the study of liquid organic hydrogen carriers in the US.

Green bid – SK earthon, the petroleum development subsidiary of energy company SK innovation, is aiming to become a carbon neutral company by focusing on two core pillars, petroleum development and environmental sustainability, Pulse News reports. According to SK earthon’s chief executive, Myeong Seong, the company will work towards realising its “carbon to green” financial story by generating tangible results and solidifying its position as a carbon solutions provider. The company plans to lead the way in achieving carbon neutrality by 2050, starting with securing a storage capacity of 2 million tonnes per year in 2030 to process CO2 generated by SK Group and other companies at home and abroad.

Windy state — Wind farms in Western Australia topped the performance charts in February, a month where the nation’s wind assets helped drive a 12% jump in power generated by renewables, YoY, according to RenewEconomy. The latest monthly data from Rystad Energy reveals all Australian utility solar and wind assets generating 3751 GWh, up from 3347 GWh in Feb. 2022. Rystad said the best performing wind assets for the month were all located in WA, including APA Group’s Badgingarra wind farm, with a capacity of 54.7%. In terms of new capacity, Rystad said Victoria was the only state to chart any any “meaningful growth” in wind generation, with an increase of 17% or 111 GWh.

VOLUNTARY

Ethical enhancement – Connecticut-based offset investment firm EthicStream is raising funds in a pre-initial public offering, hoping to raise $10 mln at $10 per share, the company announced in a press release Wednesday. Using the Dealmaker.tech platform, investors can purchase shares on the company’s website. Back in mid-February, EthicStream said it was intending to secure a 10-year offtake agreement in what would be the largest forest offset project in the Western Hemisphere, in partnership with its sister company and developer CarbonEthic.

On the ledger – Canada-based VER investment firm DevvStream on Tuesday announced an exclusive carbon credit management agreement with AgriLedger, a global advisement and consultative service specialising in carbon offset strategy, renewable energy development, and Ag-DLT value-chain optimisation solutions for industrial, agricultural, and municipal clients. Under the agreement, DevvStream acquires exclusive rights and title to carbon credits resulting from projects developed by AgriLedger, and will additionally manage the creation, validation, certification, registration, storage, security and liquidation of project credits.

Sustainable ships – The technology group Wartsila has received its first order for CCS-Ready scrubbers the company announced Wednesday. The order was booked in Wartsila’s order intake in November 2022 and the delivery is expected to take place in 2023. Four 8,200 twenty-foot equivalent unit (TEU) container vessels, being built at an undisclosed Asian based yard, will be fitted with Wärtsilä’s CCS-Ready 35MW scrubber in an open loop configuration. The scrubbers are termed CCS-Ready because, as part of their installation, Wartsila will perform additional design and engineering work to ensure that future retrofits for a full CCS system on the vessels have already been accounted for during the newbuilding construction stage.

AND FINALLY…

Chatbot says – The Chat Generative Pre-trained Transformer (ChatGPT) chatbot, developed by technology firm OpenAI and launched last November, suggested that public policy such as a carbon tax or a cap-and-trade system supported environmental sustainability efforts in the Washington DC region, the DC region publication Greater Greater Washington reported. The chatbot has become popular because of its often surprisingly insightful AI-powered responses to questions users have posed to it, however the bot does not always answer accurately, as Carbon Pulse recently found out.

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