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TOP STORY
EU nations approve revised ETS Brexit-proofing measure to accommodate UK
EU member state officials on Thursday endorsed a revised Brussels plan to protect the ETS from an uncoordinated UK exit, with the agreed measure echoing Britain’s proposed approach and seeking to avoid disrupting and bifurcating the market.
ASIA PACIFIC
China ponders voluntary ETS verification after poor CO2 data brings headaches
China may exempt ETS participants from having to undergo mandatory third-party verification on their emissions output after inaccurate data submitted by local auditing agencies has brought headaches for the country’s top decision-makers.
NZ minister sets sights on carbon price above NZ$25
New Zealand’s carbon price needs to be above NZ$25 ($17.11), the nation’s climate change minister said Thursday, further fuelling the upwards trend in the country’s emissions trading scheme.
Low volume, higher prices expected in Australia ERF auction
Low volumes are expected to be offered into Australia’s sixth Emissions Reduction Fund auction next week, likely leading to slightly higher prices than in the previous round, according to analysts.
EMEA
EU Market: EUAs stumble as member states agree less restrictive ‘Brexit shield’ plan
European carbon prices fell on Thursday as EU lawmakers reached agreement over a less restrictive ‘Brexit-proofing’ amendment that is unlikely to cut usable EUA supply or lead to a partitioned market.
AMERICAS
Ontario publishes final cap-and-trade regulation, making final market tweaks
Ontario this week published its final cap-and-trade programme regulation, which cemented the scheme’s upcoming emissions caps to 2030 and aligned its other rules to those of California and Quebec.
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BITE-SIZED UPDATES FROM AROUND THE WORLD
Pompeo and circumstance – The Trump administration is poised to replace Rex Tillerson as the US’ top diplomat with Mike Pompeo, the New York Times reported on Thursday. That would see a former oil chief who paid lip service to climate action swapped for a major beneficiary of oil money who was a vocal opponent of the Paris climate agreement. According to Climate Home, as Republican congressman for a Kansas district 2010-17, Pompeo described the 2015 Paris pact as a “costly burden” to the US. “Congress must also do all in our power to fight against this damaging climate change proposal and pursue policies that support American energy, create new jobs, and power our economy,” he said in a statement at the time.
Devastating – A new provision in the US tax cut bill that is headed for a vote in the Senate could undercut the financing mechanism that has been a major driver in the rapid growth of renewable energy projects, Utility Dive reports. Four trade organisations representing a broad swath of the renewable energy industry sent an urgent letter to members of the Senate asking them to reconsider the Base Erosion Anti-Abuse Tax (BEAT) provision, which they say could have a “devastating” effect on renewable energy projects. The BEAT provision is designed to make it harder for corporations to dodge taxes, but it would also sweep up tax credits – such as the renewable energy Production Tax Credit for wind power projects and the Investment Tax Credit for solar projects – making the credits more difficult to monetize.
A new lease on life – The largest coal plant in the western US will keep operating through 2019 after its owners received approval from the federal Bureau of Reclamation and Bureau of Indian Affairs to extend its lease. According to Utility Dive, the plant’s owners, including Reclamation and a group of utilities, had planned to close the 2,250MW Navajo Generating Station in 2018. The Navajo Nation, which owns the land on which the plant sits, voted to extend its lease until 2019, but needed final approval from the federal agency. Arizona utility Salt River Project and other owners still plan to shutter the facility after its lease expires, citing competitive pressures from cheap natural gas. The Navajo Nation and coal supplier Peabody Energy are working to find a new owner for the plant.
Tax on the floor – A German CO2 tax in combination with a European carbon floor price would be a very effective means to protect the climate, according to a study by consultancy Energy Brainpool commissioned by the German Renewable Energy Federation (BEE). This model would largely avoid both shifting emissions abroad and electricity imports to Germany, and would lower the renewable power surcharge paid for by consumers, according to a BEE press release (in German). (Clean Energy Wire)
We want a refund – Peugeot maker PSA Group, which paid General Motors €1.3 billion for German subsidiary Opel, now wants about half of the money back after discovering that Opel is set to miss EU CO2 emissions targets by a wide margin, sources told Reuters. The French carmaker intends to pursue a legal claim on the grounds that it was misled about Opel’s emissions strategy, said two people familiar with the matter. (Clean Energy Wire)
How do you like your aluminium? – Norwegian aluminium producer Norsk Hydro launched a low-carbon brand on Thursday and predicted that customers ranging from carmakers to packaging firms will pay a premium to help slow climate change. According to Reuters, under the scheme Hydro will guarantee that a tonne of aluminium needed a maximum of 4 tonnes of CO2 emissions to produce, from mining of the raw material bauxite to smelting and casting. That would be half the world average of 8 tonnes and far less than 18 tonnes coal-fired smelters in China and Australia. Hydro’s average carbon footprint is now 5.8 tonnes. Rivals Alcoa, Rio Tinto and Rusal have previously started to seek higher prices for aluminium made at smelters run on renewable hydro-power, rather than high-emissions fossil fuels.
Brazil trading – Brazil is set to have a law next year for the RenovaBio national carbon credits programme to spur the use of renewable fuels after congress passed a bill to create it this week. Similar to the US Renewable Identification Numbers (RINs), the credits, called CBIOs, will be tradeable financial instruments issued by biofuel producers when they finalise ethanol or biodiesel sales and calculated based on individual CO2 emissions during the production process. Fuel distributors must meet their targets by demonstrating the possession of CBIOs or face sanctions. (Platts)
And finally… Self censorship – Scientists in the US appear to be self-censoring by omitting the term “climate change” in public grant summaries, according to NPR analysis of grants awarded by the National Science Foundation. NPR found a “steadily decreasing number with the phrase ‘climate change’ in the title or summary, resulting in a sharp drop in the term’s use in 2017. At the same time, the use of alternative terms such as ‘extreme weather’ appears to be rising slightly”. NPR adds: “The change in language appears to be driven in part by the Trump administration’s open hostility to the topic of climate change.”
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