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TOP STORY

FEATURE: What do the German elections have in store for climate policy?

Climate experts see a new Conservative-led government in Germany staying the course on climate action, albeit with a greater focus on carbon pricing and removals that some warn risks backfiring politically.

AVIATION/SHIPPING

US airlines to carry big demand for Phase 1 CORSIA credits

The US stands to be the country with the largest demand from its airlines for Phase 1 of the UN’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), according to analyst forecasts.

ASIA PACIFIC

Indian govt releases draft methodologies for voluntary carbon market, seeks feedback

India’s Bureau of Energy Efficiency (BEE) has released 12 draft methodologies to be adopted for its voluntary offset mechanism under the country’s Carbon Credit Trading Scheme (CCTS) and has opened them for public consultation, it announced this week.

China finalises steel sector emissions accounting rules

China has finalised emissions accounting rules for domestic steelmakers, in order to prepare mills for their entry into the national emissions trading scheme.

CN Markets: CEAs move in narrow range ahead of holidays, CCER liquidity continues to dwindle

China continued to see trading activity muted in its national emissions market over the past week, while the country’s under-supplied voluntary also experienced draining liquidity.

EKI executives resign to set up own carbon consulting company

Three executives have resigned from India’s largest offset developer EKI Energy to co-found their own carbon market firm, they told Carbon Pulse Friday.

EMEA

UK Climate and Nature Bill stalls as Labour government blocks progress on binding targets

A proposed UK law to make climate and environmental targets legally binding amid a more joined-up approach has been delayed after a contentious debate in parliament.

Zambia publishes carbon market framework in step towards Article 6 trade

Zambia has published a carbon market framework, which establishes a fee structure for international credit trade, the institutional arrangements for managing markets in the country, and the functions of its national registry, as it moves a step closer towards Article 6 readiness.

EU’s leaked ‘competitiveness compass’ puts focus on regulatory simplification

The European Commission says it will deliver an “unprecedented simplification effort” in a leaked draft of its ‘competitiveness compass’ seen by Carbon Pulse on Friday, which also includes a decarbonisation roadmap.

No ETS2 revision planned before 2028, EU sources say

There is no planned revision of the EU’s Emissions Trading System for road transport and heating fuels (ETS2) until 2028, EU sources told Carbon Pulse in response to calls from national governments to address social acceptability concerns before the scheme kicks off two years from now.

BRIEFING: The Swiss roll out ‘leading’ carbon removal targets in climate act

Switzerland has set the carbon removal sector alight after bringing into force bold new climate legislation at the start of the year, offering millions in funding for carbon capture projects.

FEATURE: UK ETS can nudge shipping towards decarbonisation, but won’t suffice on its own

Adding shipping to the UK ETS could help push the sector towards decarbonisation — but there are concerns that the carbon price is still too low to make a dent and that it creates a patchwork of regulations in a market where international measures are also in the pipeline.

BRIEFING: UK Woodland Carbon Code standard to apply for ICVCM, trialling digital MRV

UK-focused forestry standard the Woodland Carbon Code (WCC) plans to apply in April for approval under the Integrity Council for the Voluntary Carbon Market (ICVCM)’s CCP-quality label, and is carrying out trials to digitise project measurement, reporting, and verification, according to a manager.

Euro Markets: EUAs settle at 15-month high above technical level as bulls protect 3% weekly gains

European carbon prices settled at their highest in 15 months on Friday, capping a 3% weekly gain as bullish positioned traders protected the recent rally by driving prices up by close to €2/tonne in the afternoon, and generating a settlement price above a key technical level.

AMERICAS

Canada’s CFR alternate compliance credit prices for 2024 face as much as 2.2% inflation

Credit prices used towards alternate compliance options in Canada’s Clean Fuel Regulations (CFR) programme for 2024 increased 2.2% compared to last year, according to a notice from the environment ministry on Friday.

CFTC: Investors reroute to V26 CCAs on ARB rulemaking hiccups, derisk across US carbon markets

Financial entities moved focus to V26 California Carbon Allowances (CCA), while continuing to derisk across V25 CCAs, RGGI Allowances (RGA), Low Carbon Fuel Standard (LFS), and Washington Carbon Allowance (WCA) holdings as credit prices in the secondary market weakened, latest figures from the US Commodity Futures Trading Commission (CFTC) showed Friday.

California diesel sales decrease in October, while gasoline consumption rises

California diesel consumption in October declined month-on-month (MoM) following two months of gains, while gasoline volumes rose from September levels as retail gas prices decreased, state data published this week showed.

CO2 pipeline developer demands recusal of South Dakota commissioner from permit review

An Iowa-based CO2 pipeline project developer filed legal action Thursday against a commissioner on the South Dakota Public Utilities Commission (PUC), demanding she be recused from reviewing the company’s permit application due to an alleged conflict of interest.

Global energy investment firm scoops US power plant

A global alternate energy investment firm is adding a Virginia natural gas power plant to its portfolio.

US DOE-funded projects should adopt legally binding community agreements -report

US DOE-funded carbon management and clean energy projects should consider legally binding community agreements to build long-term trust in low-carbon projects, a national think tank suggested Friday.

INTERNATIONAL

Article 6 body should establish ownership rights to attract financial sector -industry group

The Supervisory Body (SBM) of the Article 6.4 mechanism should weigh in on property rights concerning UN-approved credit issuances at its February meeting, according to an emissions trading industry group.

ICE sees record environmental contracts trade in 2024

The ICE exchange on Friday said it saw a record number of environmental contracts trade in 2024, and confirmed the launch of new EU ETS2 futures in May.

Net zero asset owners initiative opens call for carbon removal expertise

The UN-convened Net Zero Asset Owner Alliance (NZAOA) has published a request for information as it seeks to ramp up to capacity building, knowledge sharing, and investment in carbon removal.

VOLUNTARY

Global Carbon Council submits application for programme-level assessment to ICVCM

The Global Carbon Council (GCC) announced Friday it has submitted its programme-level assessment application to the Integrity Council for the Voluntary Carbon Market (ICVCM).

BIODIVERSITY (FREE TO READ)

All our nature and biodiversity articles remain free to read (no subscription required). However, we now require that all readers have a Carbon Pulse login to access this content in full. To get a login, sign up for a free trial of our news. If you’ve already had a trial, then you already have a login.

INTERVIEW: Acoustic indices unfit for monitoring species richness in biodiversity markets, expert says

Acoustic indices used in biodiversity monitoring often fail to accurately reflect species richness, representing a potential challenge for the nascent biodiversity credit market, a conservation expert told Carbon Pulse.

Afforestation, bioenergy projects may do more harm than good to nature, study says

Nature-based solutions (NbS) designed to curb climate change, such as afforestation and bioenergy cropping projects, could lead to unintended consequences for biodiversity, as they alter vast areas of land and habitat, according to a new paper.

Australian state commits almost A$120 mln to protect land, sea, and biodiversity

Queensland’s newly elected conservative government on Friday promised A$117.84 million ($74.44 mln) for natural resource protection over the next four years.

UK non-profit launches urban biodiversity credit standard

A UK non-profit has launched a global crediting standard for measuring urban biodiversity and ecosystem services, in a bid to tackle urban crises such as air pollution, flooding, and the heat island effect.

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EVENTS

Calyx Webinar: 5 Ways to Minimize Environmental and Social Risk – Jan. 29 – As a carbon credit buyer you want to maximize your impact and minimize your risk. Join sustainable development experts as they share strategies for decreasing environmental and social risks in carbon projects so you can make informed purchasing decisions and investments. Register now!

Carbon Forward Asia – Mar. 4-5, Singapore – Our third annual Asian conference will once again be held in Singapore. Like at our past events, we’re excited to bring together experts from Asia Pacific to talk ASEAN markets, regional opportunities, developments in local and global carbon pricing, and all the topics you need to hear about across a stimulating two days. Register here

North American Carbon World (NACW) – Mar. 25-27, Los Angeles – The annual NACW conference addresses the most pressing issues in climate policy and carbon markets to the largest gathering of climate professionals in North America. NACW 2025 will dive into major new policies and developments that will shape and scale carbon markets and climate solutions with integrity and ambition. In addition to outstanding speakers, discussions, and insights, NACW provides premier networking opportunities with an active and engaged audience of carbon professionals. Join us for the content, community, and connections for successfully navigating the low-carbon landscape and advancing market-based climate solutions. www.nacwconference.com

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ADVERTISING BROCHURE

Carbon Pulse has published its 2025 advertising brochure and media pack, featuring updated offerings and prices. With that, bookings are now open for advertising on our website and in our newsletters.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

INTERNATIONAL

Methane mayhem –  A little-known set of EU rules designed to fight climate change is creating a looming hurdle between Europe and any effort to buy more US gas, industry experts and politicians are warning. President Trump has said that if the EU doesn’t want to face crippling tariffs on trade, “the one thing they can do quickly is buy our oil and gas.” But while EU officials have confirmed they are open to negotiating with the White House, experts are pointing out that upcoming emissions rules may get in the way. In 2027, EU countries will start penalising companies when they import fuel that doesn’t comply with new methane emissions rules. Those measures were developed in partnership with the Biden administration. But Trump appears keen to reverse the requirements on his end. If US firms use that as an opening to scale back methane efforts, that could create extra fees when their gas is sold into the EU market. The situation creates “potential tension,” said Matteo Mazzoni, director of Energy Analytics at commodities intelligence firm ICIS — especially for someone like Trump, who sees things through a tariff lens. (E&E News)

AMERICAS

Tech bros for Trump – Tech leaders, who vehemently criticised Donald Trump’s 2017 decision to withdraw the US from the Paris climate agreement, have largely remained silent after a similar move this week, reflecting a stark change in the industry’s stance. In 2017, executives like Mark Zuckerberg, Tim Cook, and Sundar Pichai publicly opposed Trump’s withdrawal, calling it harmful to the environment and economy. Today, their silence is notable, amid growing emissions, worsening climate disasters, and rising energy demands from AI-related data centres. The shift coincides with Trump’s alignment of fossil fuel expansion with AI development, a strategy aimed at competing globally, particularly with China. Trump’s administration has attracted tech giants like OpenAI, SoftBank, and Oracle for a $500 bln AI project, despite uncertainties over its energy sources. While firms like Amazon, Apple, and Google maintain public decarbonisation commitments, critics argue their muted response reflects a prioritisation of profit and government favour over climate advocacy. Analysts suggest the industry’s dependency on federal support for AI and other technologies has tempered its climate criticism, even as emissions from tech giants continue to rise due to AI’s energy intensity.  Tech companies’ environmental progress under Biden were also offset by tensions over antitrust actions, labour issues, and taxes.  Observers expect Silicon Valley to continue its climate initiatives, though with reduced enthusiasm during Trump’s presidency, as executives navigate political dynamics while pursuing energy-intensive AI advancements. (E&E News)

Save the IRA – At least eight Republicans on Wednesday urged lawmakers at the House Ways and Means Committee to preserve some tax credits expanded under the Inflation Reduction Act (IRA), E&E News reported Thursday. The testimony by GOP lawmakers at the committee’s member day hearing sheds light into challenges facing Republicans as they finalise a tax package to be passed via reconciliation, which could repeal parts of the IRA, said E&E. GOP can only afford to lose a handful of votes given their thin majority of 218–215 over Democrats in the US House. Most of the testimonies on Wednesday came from the 18 lawmakers who wrote to House Speaker Mike Johnson (R) in support of energy tax credits under IRA in August.

Farming funding freezes – US President Donald Trump’s administration has temporarily frozen funding for predecessor Joe Biden administration’s Partnerships for Climate-Smart Commodities initiative, aimed at creating a more climate-friendly food system. The programme, funded with $3 bln in grants from the Commodity Credit Corporation (CCC), supports projects to lower methane emissions in rice production, reduce the carbon footprint of beef, and promote cover crops. The CCC, traditionally used for disaster relief and farm commodity purchases, was previously utilised during Trump’s first term to assist farmers impacted by tariffs. The freeze halts all grant-related actions, including those under this initiative. (E&E)

Leave no trace – The US Energy Department’s website looks very different than it did on the eve of President Trump’s inauguration, E&E News reports. The department’s home page now includes a banner titled “Restoring Energy Dominance” and declares that Trump’s “Day One Actions will Return the Department to Regular Order.” It’s just one of the many aspects of the federal government’s websites that have gotten makeovers in the days since the Trump team took office. It’s typical for new administrations to put their own stamp on official government websites and communications, but the early overhauls are one piece of the Trump team’s broader plans to erase the Biden administration’s climate and energy work across the government.

Hochul nominates Lefton – Governor Kathy Hochul (D) of New York is set to nominate Amanda Lefton, a former official from the Biden administration, as the new head of the state Department of Environmental Conservation, E&E reported. Lefton, who has a background in Albany and is currently employed by an offshore wind developer, is expected to receive the nomination, pending Senate confirmation. Should she be approved, Lefton will replace Sean Mahar, the interim commissioner, who stepped in after Basil Seggos departed the role in April, following almost nine years in the position.

Six-hour ARB marathon – California regulator ARB will host a virtual workshop on potential updates to methodologies used to calculate carbon stocks in the Natural and Working Lands Carbon Inventory on Feb. 7 from 0900-1500 PST (1700-2300 GMT). ARB staff are evaluating potential updates to methods for estimating ecosystem biomass and soil carbon stocks and stock change, and are looking for feedback on the methods and data sources that staff will use to update the inventory in the future. Staff will also discuss requirements of SB 901, which requires ARB to report on the carbon impacts associated with forest management and wildfires, and presented the methods used to estimate wildfire emissions. The latest SB 901 report was in 2020 and the next report will be issued this year, as required by law every five years.

Building a greener Georgetown – The Government of Guyana has partnered with The King’s Foundation and Qatar Foundation’s Earthna Center to support sustainable urban development as part of Guyana’s Low Carbon Development Strategy (LCDS) 2030. The collaboration includes constructing a sustainable building in Georgetown, combining local materials and expertise with international knowledge to create a model for environmentally conscious urban planning. Insights from the project will be shared globally with countries facing similar climate challenges, including Qatar. Announced on Jan. 20 in an event in Scotland, the partnership builds on discussions led by President Irfaan Ali in 2024 and aims to integrate traditional knowledge into modern sustainability practices. The project will be showcased at the second edition of the Earthna Summit in Doha, Qatar, from Apr. 22-23, 2025. (Stabroek News)

Cash for the climate – On Thursday, the Canadian government announced over $4.5 mln in funding for nine climate adaptation projects in southern Ontario and nationwide under Natural Resources Canada’s Climate Change Adaptation Program (CCAP). The funding, part of a broader $39.5 mln investment announced in Nov. 2024, supports initiatives increasing resilience against wildfires, floods, and rising sea levels. The newly funded projects aim to equip professionals, businesses, and communities with tools, training, and resources to adapt effectively. According to the government, every dollar spent on adaptation can save up to $15 in long-term costs of mitigating climate change impacts.

Moe coal power – Saskatchewan Premier Scott Moe has announced plans to potentially extend the operation of the province’s coal-fired power plants to ensure affordable and reliable electricity. In a social media post, Moe emphasised that decisions on power generation will prioritise Saskatchewan families and the economy, rejecting federal Clean Electricity Regulations, which initially targeted a renewable energy grid by 2030, later extended to 2050. The province is also exploring small modular nuclear reactors and enhanced renewable energy sources as part of its long-term energy strategy. (Regina Leader-Post)

Not a clean getaway – Argentinian President Javier Milei is considering a withdrawal from the Paris Agreement just days after US President Donald Trump announced the same, FT reports. This follows the South American country’s impromptu departure from the COP29 UN climate negotiations in November. At the time, the Argentinian foreign minister stated that Argentina would not withdraw from the Paris accord and was simply reevaluating its stances on international environmental policy. Now, a withdrawal could affect the EU-Mercosur trade agreement concluded in December. The deal, which Milei welcomed, specifies that parties may suspend terms if a signatory leaves the Paris Agreement. Exiting the accord would technically require the approval of Argentina’s National Congress. However, Milei has at times bypassed this process through emergency decrees.

EMEA

Our Azeri friends – Ukrainian President Volodymyr Zelenskyy on Saturday announced Ukraine’s readiness to transit gas from Azerbaijan to Europe, excluding Russian gas, following discussions with Azerbaijan’s President Ilham Aliyev. Zelenskyy highlighted Azerbaijan’s significant export capacity of 25 bln cubic metres and proposed using Ukraine’s infrastructure to address European gas needs, particularly for Slovakia and Moldova’s Transnistrian region, amid Russian gas supply disruptions. Russia ceased gas flows through Ukraine this month, causing disputes with Slovakia and Hungary, which previously relied on these supplies. Zelenskyy reaffirmed Ukraine’s refusal to renew a gas transit deal with Russia, emphasising opposition to allowing Russian profits during the ongoing war. Experts, however, question Azerbaijan’s ability to supply sufficient volumes, with some suggesting potential volume swaps involving rebranded Russian gas. Discussions on the matter are intensifying, particularly as EU diplomats prepare to meet to address sanctions against Russia. Hungarian Prime Minister Viktor Orban has threatened to veto sanctions unless Ukraine reopens Russian gas transit, raising tensions within the bloc. (Politico)

FDP policies – Germany’s liberal FDP party has set out their energy and climate policies as part of their manifesto ahead of the Feb. 23 federal election.  Among them are pledges to:

• Extend the EU’s climate targets to include the bloc’s negative emissions goals, and expand the carbon market to cover more aviation emissions and all GHGs
• Replace Germany’s 2045 net-zero target with the EU’s 2050 goal
• Introduce a climate dividend that is paid to citizens, while also “drastically” reducing energy taxes
• Enable CCS and CCU technologies “without discrimination”
• Base state funding on actual CO2 cuts, “not theoretical figures”
• Achieve the transition to climate-friendly vehicles through market-based incentives rather than engine bans
• Reform the EU’s CBAM and replace it in the long term with a global carbon pricing mechanism

FDP is far behind in the polls though. The most likely outcomes of the election at the moment would see the CDU/CSU forming a coalition either with the Greens or the Social Democrats (SPD), who are leading the outgoing government alliance with the FDP and Greens.

No more coal – EDP may use the land under its soon-to-be-decommissioned coal plants in Spain to build new data centres, as artificial intelligence drives demand for new computing capacity, Bloomberg reports. The Portuguese utility previously had plans to build hydrogen and battery projects at some of the locations. But with the rise in AI, the firm is now considering to house data centres as the grid connection is so valuable, CFO Rui Teixeira said in an interview at the World Economic Forum in Davos. EDP aims to be coal free by the end of this year. In 2023, it requested authorisation from Spain’s electricity system operator to close its remaining coal-fired power plants in the country. It is converting the Abono II plant to run on gas. The firm also owns the Abono I, Soto 3, and Los Barrios coal plants.

More bad news – A third of the European steel industry could vanish if the EU does not take action against unfair competition from imports, the chairman of ArcelorMittal France said during a hearing at the Economic Affairs Committee of the French National Assembly. Alain Le Grix de la Salle said that there is no certainty of French steel plants’ uninterrupted operation. Large-scale imports of cheap steel from countries that don’t have environmental standards are harming the competitiveness of EU producers. High energy costs in Europe are also an obstacle for the bloc’s steel sector. ArcelorMittal has already halted decarbonization investments at its Dunkirk plant due to unfavourable conditions. (GMK Center)

ASIA PACIFIC

Fostering fossil fuel ties – A statement from Greenpeace Indonesia criticised the visit by newly-appointed Japanese Prime Minister Shigeru Ishiba to Malaysia and Indonesia, saying it highlighted its business as usual agenda of promoting fossil fuels under the guise of the Asia Zero Emissions Community (AZEC) initiative. The statement, like previous findings, said Japan is using AZEC to prioritise development of LNG, ammonia co-firing at coal-fired power plants, as well as cross border CCS, which the NGO decried as a false solution, at the expense of renewables. Greenpeace noted Ishiba chose Malaysia and Indonesia as his first overseas destinations in his new role.

Italo-Viet carbon credit deal – Vietnamese province Quang Tri has signed with Italian oil company Eni for carbon credit development potential, wire service VNS reported this week. Eni Natural Energies signed a Memorandum of Understanding with the People’s Committee of the central Quang Tri, the most heavily bombed of all provinces during what is locally referred to as ‘the American War’. Eni holds permits in the offshore Phu Khanh Basin and was looking to drill last year. How the credits will be generated, their number, and what market they may head into was not disclosed. Rather, the MoU outlines hopes for further cooperation, according to VNS. 

VinFast speeds EV charge – The car marking arm of Vietnamese conglomerate Vin Group, VinFast, has signed a non-binding agreement with Taiwan’s eTreego to deploy over 100,000 EV charging stations across Vietnam, Indonesia, and the Philippines. In addition to its homebase in Vietnam, Indonesia and the Philippines are seen as key areas for the carmaker, which ventured into EVs several years ago, to mixed reviews. The project will run until 2030, with a pilot phase this year of just 200.  

Renewables subsidiary – Tokyo-listed trading company Takashima has acquired all outstanding shares of Sanwa Holdings, which has a nationwide network specialising in solar power generation systems, according to a statement released this week. Takashima has set an investment target of 15 billion yen ($96 mln) by the fiscal year ending March 31, 2026, and is promoting investment in strategic areas to transform its business structure.

VOLUNTARY

New methane credit insurance – Well Done Foundation (WDF), a national nonprofit, whose mission is to plug orphaned oil and gas wells across the United States, has helped design an insurance product for its first crop of methane reduction credits, according to Reinsurance News. AgriCap Group has launched the new “Insured Carbon” programme, which includes a custom-structured parametric insurance programme by AXA, to ensure the realness, permanence, and exclusivity of the carbon credits. It provides insurance against devaluation, degradation, deterioration, or invalidation for the life of verified carbon credits. In December, WDF offered 268,626 credits for sale from the 778,000 credits to be issued as part of the non-profits 2023 Montana Legacy Project. The credits have been certified by CarbonPath, which uses the Celo blockchain to create its tokens. There are aggregated emissions of 276,000 Mt of methane per year (6.9 MtCO2e per year) from the 2,203,057 O&A wellbores in the US, the certifier claims.

INVESTMENT

MERP contract – Kuva Systems, a Massachusetts-based methane reductions technology provider, has won a $5 mln contract with the US DOE’s Methane Emissions Reduction Program (MERP). The agreement will support Kuva in refining and demonstrating its remote emissions investigation system across 175 oil and gas sites in the US. The award was part of DOE’s $850 mln in federal funding to reduce methane emissions in oil and gas announced last June.

AND FINALLY…

Ash and oceans don’t mix – Wildfires in Los Angeles have had significant secondary effects on the nearby marine ecosystem, according to new research from UC San Diego’s Scripps Institute of Oceanography and NOAA Fisheries. Ash and debris, including toxic materials such as heavy metals, microplastics, and polycyclic aromatic hydrocarbons, were found up to 160 km offshore, potentially threatening marine life and fisheries. The team aboard NOAA Ship Reuben Lasker collected water and ash samples to assess their spread, toxicity, and effects on organisms such as anchovy eggs. The research, part of the long-running California Cooperative Oceanic Fisheries Investigations (CalCOFI) programme, aims to understand the ecological consequences of these urban wildfires and their implications for coastal ecosystems.

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