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TOP STORY

POLL: Analysts lift EU carbon price forecasts, but expect enduring bearish factors to cap any gains

Analysts have nudged up their short- and medium-term forecasts for EU carbon allowances, though most repeated expectations that any prices rises will remain limited by weak demand from emitters and ample supply.

VOLUNTARY

DATA DIVE: Why the VCM might only recover in 2026

The voluntary carbon market is in a slump, characterised by low trade volumes and largely sluggish prices, as a consistent flow of bad press around projects has put off potential buyers.

Concerns raised about huge soil carbon project in Kenya after founder resigns in protest at Board’s behaviour

The abrupt resignation of the founder of Kenya’s National Rangeland Trust (NRT) in protest against alleged inappropriate behaviour by the Board has triggered an informal review by Verra on whether there should be implications for the huge soil carbon project in the country, the standard body told Carbon Pulse Friday.

INTERNATIONAL

Asia driving global surge in electricity demand as EU industrial slump drags on -IEA

Global demand for electricity is on track to be among the highest in two decades this year, driven by EVs and a solar boom in China, while demand in Europe remains depressed in the aftermath of the 2022 energy crisis, according to the International Energy Agency (IEA).

DATA DIVE: Why the steel industry may have turned a corner on net zero

The steel sector has potentially turned a corner on net zero, says a new report, after years of being considered a laggard in emissions reduction pathways.

Green Climate Fund approves $1 billion in fresh funding

The board of the world’s largest dedicated climate fund, the Green Climate Fund, approved $1 billion in fresh funding at its meeting this week, it announced Friday.

Azerbaijan launches Climate Finance Action Fund with initial target of $1 bln

Azerbaijan has today announced the launch of the Climate Finance Action Fund (CFAF), initially targeting $1 billion in financing from fossil fuel producing countries and companies, and half of the capital to go towards climate projects in developing countries.

Miners want coal to make steel, money men think otherwise -report

Investors believe steel can be made cleanly and are willing to spend on it, whilst also being increasingly sceptical about the long-term financial viability of the metallurgical coal used to make the vast majority of steel, an Australian activist investor group said Friday in a report based on a survey of 500 respondents from 34 nations with cumulative billions of dollars under management.

Olympics sponsor Toyota emits much more CO2 than host nation, says think tank

Toyota has been awarded the gold medal for being the highest emitting sponsor of this year’s Olympics, responsible for much higher CO2 emissions than host nation France, in an ironic twist for the event claiming to be the ‘greenest games yet’.

UNIDO issues call for African JCM projects

The UN Industrial Development Organization (UNIDO) has issued a call for African projects interested in registering to generate carbon credits under Japan’s bilateral Joint Crediting Mechanism (JCM).

EMEA

BRIEFING: EU’s CBAM violates Paris Agreement principles, raises cost of decarbonisation in Global South, panellists say

The European Union’s Carbon Border Adjustment Mechanism (CBAM) is in “clear violation” of the Paris Agreement’s principle of common but differentiated responsibilities (CBDR) and places the burden of decarbonising heavy industrial sectors on the Global South, panellists told a webinar this week.

Turkish parliament approves law to start taxing ship emissions

The Turkish parliament has passed a law requiring ships to pay for the greenhouse gas emissions released when entering and departing from the country’s ports.

Algeria sets sights on CCS to lower national carbon footprint -media

Algeria’s government and private sector are looking to carbon capture and storage (CCS) to counterbalance emissions from oil and gas production, with an eye to minimising the impact of the EU’s Carbon Border Adjustment Mechanism (CBAM), according to local media sources.

Euro Markets: EUAs post second weekly loss as bearish trend outweighs pre-weekend short covering

European carbon recorded a second weekly decline with prices falling to an 11-week low amid very light volume, as the market shrugged off a late short-covering rally ahead of the weekend, while energy markets also saw a quiet end to the week as the summer holiday season neared its peak.

ASIA PACIFIC

India releases updated compliance carbon market regulations

The Indian government has released detailed compliance carbon market regulations, under the Carbon Credit Trading Scheme (CCTS) 2023, following months of extensive stakeholder consultations across all major cities in the country.

CN Markets: CEA price continues to drop, trading volumes remain steady

China’s national carbon market saw its price continue to fall this week amid slightly decreased liquidity, though some believe that the price effect of a new carryover mechanism will not appear until next year.

Marubeni takes stake in Danish biochar tech firm

Japanese trading house Marubeni has taken a stake in a Danish company whose biochar technology can reduce carbon emissions from sewage sludge treatment by 80%.

China CCER registry system sees surge in account registration

More than 4,500 participants in China’s voluntary carbon market have opened accounts on the national registry platform since the restart of the domestic offset programme earlier this year.

South Korea national trust teams up with climate tech firm to develop nature-based credits

South Korea’s National Nature Trust (NNT) has teamed up with a climate tech company to work on the creation of technology-backed carbon credits by utilising its environmental assets.

AMERICAS

US appeals court dismisses request to pause EPA power plant rule

A US federal appeals court on Friday rejected another request for a temporary pause on controversial Environmental Protection Agency (EPA) power plant standards as they are being challenged on merit.

Colorado proposes rules to facilitate trading between industrial, EITE facilities under in-state carbon market

Colorado has unveiled recommendations to broaden its embryonic, in-state carbon market by facilitating trading between the largest industrial manufacturing facilities and energy-intensive and trade-exposed (EITE) sectors such as cement and steel.

Iowa lawmakers, local governments, landowners ask state to reconsider CO2 pipeline approval

Iowa state Republican lawmakers, counties, and landowners filed separate motions on Monday requesting the Iowa Utilities Board (IUB) to reconsider its issuance of a construction permit to a proposed CO2 pipeline.

COT report shows CCA traders reposition to 2025, RGA compliance demand remains robust

Stakeholders shifted their California Carbon Allowance futures and options holdings to vintage 2025 in the aftermath of ARB’s cap-and-trade workshop fallout, while the month-long trend of strong compliance demand for RGGI Allowances (RGA) continued, weekly data from the Commitment of Traders’ report released Friday showed.

Canada pours another C$71 mln into 2 Billion Trees programme despite past shortfalls

Canada’s ministry of natural resources on Friday announced more than C$71 million ($51.7 mln) in additional funding to support its 2 Billion Trees (2BT) initiative, which was previously deemed unlikely to meet its target without significant changes.

NY Governor announces $100 mln to decarbonise the Empire State Plaza

New York Governor Kathy Hochul (D) on Friday unveiled $100 million to decarbonise the Empire State Plaza, targeting a 20% GHG reduction in its operations.

BIODIVERSITY (FREE TO READ)

Multiple indexes required to properly quantify biodiversity loss, French bank says

Combining several indexes largely focused on species abundance and diversity is the most efficient way for companies to assess biodiversity risks and impacts, according to French-headquartered bank BNP Paribas.

First assessment of groundwater-dependent ecosystems flags high protection gaps

Less than a quarter of worldwide ecosystems reliant on groundwater are in protected lands or regions with policies aimed at conserving them, a paper has found.

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CONFERENCES

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• Director Carbon Procurement, KliK Foundation – Zurich
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BITE-SIZED UPDATES FROM AROUND THE WORLD

AMERICAS

Bye bye Biden – President Joe Biden on Sunday announced he will not seek re-election and has endorsed his VP Kamala Harris as the Democratic nominee. His decision, revealed on social media and pending a more detailed upcoming speech, has not solidified Democratic leadership support around Harris, with significant figures and former President Obama suggesting the party’s next steps are still undecided. Biden’s announcement has opened the possibility for an open convention if no clear nominee emerges before the Democratic National Convention on Aug. 19. The situation remains fluid, with potential for various candidates to emerge, reflecting ongoing debates within the party about future directions and policy priorities, especially in relation to energy and environmental regulations.

Report cards – The upcoming US election is critical for climate action, CleanTechnica said in its US Presidential Climate Policy Report Card, noting that the Biden-Harris administration has advanced climate initiatives significantly, contrasting sharply with Trump’s first term that saw major setbacks like withdrawing from the Paris Agreement and stalling the Kigali Amendment. Biden’s policies have been aimed at transforming the energy landscape, targeting ambitious goals like achieving a carbon-free power sector by 2035 and significantly boosting renewable energy production through federal initiatives. However, these efforts are challenged by protectionist policies that may elevate costs and slow the deployment of renewable technologies, such as tariffs on Chinese solar panels. Biden’s efforts have also faced structural hurdles in transportation, where the US’ car-centric urban design and outdated public transit systems hinder swift adoption of greener alternatives like electric vehicles. Trump’s campaign, on the other hand, signals another regression in climate policies. His previous term saw significant environmental rollbacks, and his future plans include withdrawing from Paris again and possibly the UNFCCC as a whole, cutting renewable energy incentives, and pushing fossil fuel usage and production, which could exacerbate climate issues. In terms of land use and agriculture, the Biden administration has emphasised conservation and sustainable practices, proposing extensive tree planting and climate-smart agricultural methods, compared to Trump’s favouring of oil and gas exploration and deregulation of environmental protections. The US military, a major federal energy consumer, also reflects these divergent paths. Biden aims for net zero military emissions by 2050, integrating zero-CO2 vehicles and requiring federal contractors to disclose and reduce emissions. Conversely, Trump’s approach in his previous term did not prioritise climate considerations, focusing instead on increasing military strength without environmental stipulations. In their report cards, Biden-Harris received grades ranging from B+ to C+, while Trump, based on his campaign pledges, received all F’s – failing grades across the board.

“Green new scam” – Former President Donald Trump led chants of “drill, baby, drill” and pledged to get rid of the Biden administration’s “green new scam” in a speech Thursday night that capped the four-day Republican National Convention. Trump gave the longest presidential nomination acceptance speech in US history, using much of the time to detail last weekend’s assassination attempt, rail about illegal immigration and insult Democrats. Trump vowed to end support for electric vehicles and “bring auto jobs back to our country” through the proper use of taxes, tariffs, and incentives, while not allowing auto manufacturing plants to be built in Mexico, China, or other countries. He pledged to redirect money from the “green new scam”, referring to Biden’s policies to fund renewable energy projects, to infrastructure projects like bridges and dams. The former president also made clear that the party’s energy platform centers on boosting fossil fuel production and repealing the Inflation Reduction Act, President Joe Biden’s landmark climate law. “We have more liquid gold under our feet than any other country by far,” he said. “We are a nation that has the opportunity to make an absolute fortune with its energy. We have it, and China doesn’t.” The US is already the world’s top oil and LNG producer. Trump, however, asserted that his plan to increase domestic energy production would help the US overcome hostile nations — and solve inflation. (E&E News, Bloomberg)

CCS regulation – Illinois governor JB Pritzker (D) signed CCS bill SB 1289 into law Thursday. Recognised as the Safety and Aid for the Environment in Carbon Capture and Sequestration Act, the new law outlines administrative protocols required of prospective CCS operators and places a moratorium on CO2 pipelines in-state until July 1, 2026, unless the federal Pipeline and Hazardous Materials Safety Administration adopts final revisions sooner to its pipeline safety rules relating to the transport of CO2.

Comment on minimum price – Massachusetts Department of Environmental Protection (MassDEP) is accepting written comments on the minimum auction reserve price for allowance auctions under its electricity generator emissions limits regulation through Sep. 12. MassDEP has concluded that the minimum reserve price should be raised to $9 per allowance from $0.50 presently. Comments and questions may be submitted via email to MassDEP.

Cap-and-trade concerns – A recent poll by the Public Policy Institute of California revealed that 59% of California residents would vote for the $10 bln climate bond heading to the ballot in November, E&E News reported. Dubbed Proposition 4, the bond would borrow the sum to pay for water resilience, wildfire response, and clean energy programmes. California Governor Gavin Newsom (D) this month approved Senate Bill 867 (SB 867) after Assemblymembers voted 66-6 in favour of the bill. The largest share of the total – some $3.8 bln – will be allocated to support safe drinking water, drought, flood, and water resilience initiatives, followed by $1.5 bln for efforts to tackle wildfires in the region.

Another lawsuit – A class-action lawsuit against American Airlines by employees challenges the use of ESG funds in their pension plans, Inside Climate News reports. Filed in Texas, the lawsuit is spearheaded by pilot Bryan Spence and targets the airline’s investment strategies, which he claims favour “leftist political agendas” rather than prioritising financial returns. The suit, which could impact up to 100,000 plan members, contends that American Airlines breached its duty by choosing fund managers like BlackRock that focus on socio-political outcomes. This case, reflecting broader national debates over sustainable investing, questions the integration of ESG factors by fund managers and could redefine employer approaches to ESG investing in employee retirement plans.

EMEA

Consultation coming – South Africa’s National Treasury plans to propose regulations for carbon markets within the next few months, Bloomberg reports. A consultation paper on the industry is expected to be published around the time of the Medium Term Budget Policy Statement in October. The Treasury’s consultation paper aims to clarify the legal status of carbon credits, determining whether they are a security, derivative, or commodity. This classification will impact exchange controls, regulation, and reporting requirements. The paper will also address the prevention of credit duplication and reissuance, ensuring consistent treatment across voluntary carbon markets, the UN’s Article 6 Policy Framework, and South Africa’s carbon tax.

Sneaky buggers – The German government’s energy tax reduction on fuels from June to August 2022, intended to alleviate rising energy costs, was not fully passed on to customers, according to an analysis by the RWI economic research institute. The fuel rebate initially lowered diesel prices by 14 cents per litre and gasoline by 29.5 cents per litre, but this effect diminished significantly over the next two months and varied regionally. RWI noted that the rebate was nearly fully passed on in the first month but decreased thereafter. Factors such as low water levels in the Rhine, affecting fuel transport, contributed to higher prices in July. The analysis also found that the rebate was less effective in higher-income regions and at gas stations without nearby competitors. These stations passed on only 84% of the diesel rebate and 80% of the E10 gasoline rebate, compared to national averages of 87% and 71%, respectively. RWI suggested that declining media interest and individual price-setting by gas station operators influenced the rebate’s effectiveness. The fuel discount, promoted by finance minister Christian Lindner of the Free Democrats (FDP), faced criticism for potentially encouraging fossil fuel use, benefiting higher-income consumers, and allowing oil companies to profit excessively. (Clean Energy Wire)

Linkage savings – Improved electricity trading and joint efforts on North Sea clean energy could save £11 bln for both the UK and EU in reaching their offshore wind goals, according to trade association Energy UK in its report “The Power of Partnership: UK-EU Energy Cooperation for a Clean and Secure Future”. However, it warns that a failure to link emissions trading systems and harmonise trading rules could lead to higher costs and hinder progress. Failing to link the EU ETS and UK ETS might result in higher energy export costs for the UK and increased fossil fuel imports for the EU, which could also deter investment in clean energy projects, said the report, which calls for greater energy sector collaboration. It also noted that over a quarter of Europe’s gas supply lost due to the Ukraine conflict was replaced by UK exports and that linking the two ETSs could save the EU €2 bln annually by reducing the need for gas imports. (Energy Live News)

Jailed protestors – Roger Hallam, the founder of Just Stop Oil, has ­received the longest ever jail sentence for non-violent protest under laws designed to crack down on public ­disruption, reports the Times. The 58-year-old was jailed for five years for coordinating the protests that disrupted the M25 in London over four days in 2022, whereby 45 protesters climbed gantries on the motorway, forcing police to stop the traffic. While another four of the protestors were each sentenced to four years after being found guilty of conspiring to cause a public nuisance. The sentences, handed down at Southwark crown court in London, were longer than those given to Just Stop Oil activists who scaled the Queen Elizabeth II Bridge over the Dartford Crossing in Oct. 2022, and were condemned by environmental campaigners, though backed by Keir Starmer, now UK Prime Minister. The UN human rights commissioner condemned the sentencing as ‘deeply troubling’ and ‘disproportionate’. A 13-week campaign by Just Stop Oil last summer cost the Metropolitan Police more than £7.7 mln, the equivalent cost of 23,500 officer shifts, according to the newspaper.

Tender time – The European Commission has launched a tender seeking analytical services to support the revision of the ETS Directive for aviation. Specifically, it involves reviewing the implementation of the ICAO’s CORSIA by third countries as stipulated in the Directive 2003/87/EC. The review will also encompass an analysis of the environmental, climate, and social impacts of various flight types, including short-haul, private, and business jet flights, along with their connectivity implications, especially considering Iceland. Furthermore, the tender addresses the need for the EU’s aviation sector to align with the Paris Agreement’s temperature goals and the EU’s broader 2030 and 2050 climate targets. The analysis will contribute to a report due by July 1, 2026, on the environmental integrity of CORSIA and will inform potential legislative amendments to the ETS, aiming to enhance its effectiveness and uphold the environmental integrity of the EU’s climate actions.

ASIA PACIFIC

Methodologies approved – The committee steering Japan’s J-Credit programme have added two new methodologies to the domestic voluntary programme, encouraging industrial companies to shift towards greener manufacturing processes. As previously flagged, two energy efficiency methodologies are now considered eligible for project developers to pursue the creation of J-Credits: the adoption of solvent-free lamination equipment and membrane separation devices.

Soon, sooner, soonest? – India and Japan are planning to enter into a Joint Crediting Mechanism (JCM) deal with an aim to share emission reduction credits mutually, according to an Indian cabinet note prepared in July, Hindu businessline reported. As per the note, carbon credits will be allocated through a structured process and there will also be a registry to track these credits. The credits will be used towards the Nationally Determined Contributions (NDCs) of both the countries. The two countries have been in talks over the JCM for a long time, initially announcing their intentions early last year.

Biogas lobbying – In a recent meeting with the Indian government officials, compressed biogas (CBG) producers and key stakeholders in the country requested the government to introduce the system of carbon credit trading in the CBG sector. The stakeholders shared their concerns about the excessive use of chemical fertilisers, which has led to the deficiency of carbon in soil and the role of bio fertilisers in restoring the carbon balance. The industry group also highlighted how the carbon credit mechanism could prove to be a substantial revenue earner and urged the government to establish the system soon in order to incentivise the fledging sector.

Partnership – Singapore-based asset manager Keppel has signed an agreement with Japanese trading firm Sojitz to jointly pursue decarbonisation and clean energy business opportunities in the Asia Pacific region. Under the partnership, both firms will jointly identify and develop multiple projects in bioenergy and resource recovery, and invest in energy solutions supporting energy transition in the region.

VOLUNTARY

Trialling biofuels – Singapore’s Global Centre for Maritime Decarbonisation (GCMD) has completed its final trial of biofuels for powering ships with German container firm Hapag-Lloyd and energy major BP, Reuters reports. This was the fifth and final trial in an $18 mln project the GCMD began in 2022 with various companies to test different biofuel blends to reduce carbon emissions. During the final trial, BP supplied 4,500 metric tonnes of a B30 biofuel, a blend consisting of 30% neat fatty acid methyl esters (FAME) and 70% very low sulphur fuel oil (VLSFO), to a container vessel operated by Hapag-Lloyd at Rotterdam port.

B gone – B Lab has revoked the B Corp certification of four Havas advertising agencies – Havas London, Havas Lemz, Havas New York, and Havas Immerse – because France-based parent company Havas Media recently secured a contract with oil major Shell. This decision comes after months of scrutiny, prompted by complaints from climate-focused groups and other B Corp-certified agencies, arguing that working with major fossil fuel producers contradicts the values necessary for B Corp certification. Despite Havas’ assertion that the specific agencies involved do not work directly with Shell, B Lab’s regulations on agency affiliations led to the decertification. The outcome is celebrated by environmental advocates and seen as a pivotal moment for enforcing stringent ethical standards in the creative industry. Havas has expressed commitment to sustainability, noting their recent achievements in environmental certifications and plans, but says it accepts B Lab’s decision to withdraw their B Corp status. (Adweek)

Scrutiny all around – A well-regulated carbon market, alongside aggressive emission reductions, could aid Malaysia in lowering emissions, protecting natural environments, and alleviating poverty, project developers Permian Global write in an online piece. Forest-based carbon projects, which prevent emissions from deforestation, are increasingly pivotal to Malaysia’s climate strategy, they said, with these initiatives aligning with the international demand for high-quality carbon credits while facing challenges from disinformation spread by critics of market-based solutions. There’s a vital need for meticulous scrutiny of carbon projects to ensure they deliver tangible climate benefits and support for local communities, Permian writes. Misinformation in the media, based on flawed analyses or misinterpretations, risks undermining the effectiveness of these projects and the broader goals of environmental conservation and poverty reduction, they add. In response to media criticism, some companies have retreated from using carbon credits, although many still recognise their value in climate mitigation, Permian notes. In response to these challenges, the carbon market is evolving with initiatives aimed at ensuring the integrity and quality of carbon credits. This includes setting stringent standards and conducting independent evaluations of projects.

INVESTMENT

Efficient engines – Japanese shipping firm MOL on Friday announced it will be investing in UK-based tech startup Carnot, which develops technology for efficient engines using heat-resistant materials. Some 30% of the combustion energy in steel and aluminium engines is used for cooling, to avoid over-heating. However, the Carnot tech will eliminate energy loss during the cooling process, potentially increasing energy efficiency by 20-40% and slashing GHG emissions in the process.

SCIENCE & TECH

Show some Phlair – Phlair, a Munich-based climate tech company, this week announced the launch of Electra 01, a new direct air capture (DAC) plant in Rotterdam, set to start operations in 2025. Utilising Phlair’s patented Hydrolyzer technology, the plant will remove hundreds of tonnes of CO2 from the atmosphere annually, supported entirely by renewable electricity and an electrolyte solution. In collaboration with Paebbl, a company specialising in carbon-negative construction materials, the captured CO2 will be transformed into a supplementary cementitious material for the construction industry, ensuring its permanent storage and adding value. Electra 01 has secured a €2.5 mln grant from the European Innovation Council and SMEs Executive Agency (EISMEA) and is expected to generate carbon removal credits.

Cryocap is chosen – Stockholm Exergi has selected Air Liquide’s innovative Cryocap LQ technology for its bio-energy with carbon capture and storage project. This technology, a major development in Air Liquide’s low-carbon technology portfolio, facilitates the liquefaction and long-distance transportation of CO2, thereby enhancing the feasibility of CCS projects. The Cryocap LQ unit, to be installed at Stockholm’s bio-cogeneration plant, will have a capacity of 3,500 tonnes per day, making it one of the largest globally. It is designed to capture approximately 8 Mt of biogenic CO2 over 10 years. Funded by the EU’s Innovation Fund, the project not only supports significant CO2 storage but also contributes to a low-carbon society by integrating with Stockholm’s district heating network, improving energy efficiency and safety. (Carbon Herald)

AND FINALLY…

Prime Minister Tubiana? The French Socialist party’s candidate to head up the next French government is a familiar face in climate circles – veteran diplomat and advocate Laurence Tubiana, Bloomberg reported. The Socialists, backed by the Greens and Communists, backed Tubiana because of her reputation as an economist focused on green and social issues, and her work on taxing corporate profits in Europe to finance the climate transition, Socialist leader Olivier Faure told France Inter radio. French lawmakers are trying to cobble together a governing majority after elections earlier this month left the parliament split into three blocs. Tubiana was France’s top climate diplomat during the 2015 COP21 summit in Paris, and is now CEO of the European Climate Foundation, which funds and supports a wide network of climate advocacy and research work. However, she is divisive within the left-wing bloc, while other parties may be looking for a more politically high-profile prime minister.

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