COMMENT: A Brave New (Article 6) World
Last week’s UN agreement on Article 6 is bullish for the role of market-based mechanisms in supporting global climate action. But the new dawn comes with added complexities, write Sebastien Cross and Tommy Ricketts of BeZero Carbon.
Read MoreCOMMENT: Switzerland’s bilateral agreements set a poor precedent for ambition ahead of COP26
Switzerland’s recent bilateral crediting deals send no signal for decarbonisation at home, while for the countries hosting the emission reductions the agreements close some of their best available options to implement their NDCs and raise ambition in the future, according to researchers at NewClimate Institute.
Read MoreECOSYSTEM MARKETPLACE – Shades of REDD+: Managing expectations for Glasgow
Glasgow is likely to produce a decision on the implementation modalities for market mechanisms under the Paris Agreement. However, those expecting that such a decision would lead to a flurry of investments into Article 6 transactions may see their hopes frustrated by governments’ and corporates’ lack of appetite for such transactions. But closing the Paris Rulebook will still be important, if only to put voluntary carbon markets on stable ground.
Read MoreECOSYSTEM MARKETPLACE – Shades of REDD+: Filling an Urgent Need – New Guidance for ‘Nested REDD+’ Published
Over the last months, several companies have announced an aggregate of more than two billion dollars of investments – in particular trading houses or major emitters – in voluntary carbon market projects that champion nature-based solutions. At the same time, the LEAF coalition is encouraging the development of jurisdictional REDD+. For such initiatives to peacefully coexist, there is an urgent need for countries to build “nested” REDD+ systems.
Read MoreCOMMENT: High anxiety in the EU ETS
Summer seems a long time ago now. Back in August and September, EU carbon was setting almost weekly records, European gas was nicely positioned at the top of the merit order, the European Commission was talking about climate ambition, and all was right with the world. And just three weeks later, the EU ETS finds itself in a time of high volatility and of high anxiety.
Read MoreCOMMENT: “Nothing surpasses the beauty and elegance of a bad idea”
It hasn’t taken long for governments to notice the EU ETS, spitting out revenue at the rate of half a billion euros a week, and get the idea that here is a mechanism ready-made to be exploited at a time of crisis. But a new Greek proposal marks a “forehead-smacking moment” that betrays a worrying lack of understanding about the market and how it works.
Read MoreCOMMENT: Is the EU carbon price rally over?
So the latest peak in European carbon prices is over. EUAs climbed to a record of €63.35 on September 8 and have settled back at around €60 over the past week. I suppose the question is: is that it? Are we done for the year, or are prices going to stage yet another rally?
Read MoreCOMMENT: What does the current price of EUAs actually represent?
Despite all the excitement around EUA prices topping €60 for the first time and moving on to a new record above €63.19 this week, let’s remember that coal-fired power generation is actually more profitable in the near term than natural gas.
Wait, what? How did *that* happen?
Read MoreCOMMENT: Putting China’s carbon market in perspective
China’s recently launched national emissions trading system (ETS) has been both lauded and loathed by pundits. Some see it as hugely important, while others see it as little more than virtue signalling. The reality is somewhere in the middle, writes TransitionZero’s Matthew Gray.
Read MoreCOMMENT: Playing with fire – the EU carbon market for buildings
EU plans for an upstream cap on emissions from buildings and transport are both welcome and worrying, says Sanjeev Kumar of the European Geothermal Energy Council.
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