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*TOP STORY* ANALYSIS: Traders expect scant buying interest at WCI Q2 auction amid COVID-19 pandemic
WCI participants anticipate limited demand for California Carbon Allowances (CCAs) at Wednesday’s joint sale after prices crashed on the secondary market this spring, which allowed compliance entities to pick up permits at a much cheaper rate than the auction floor price.
*ASIA PACIFIC* Australia confirms major reform plans for ERF, Safeguard Mechanism
Australia on Tuesday confirmed it is planning major changes to its market-based climate policy package, which would include reforms such as crediting Safeguard Mechanism entities, awarding credits to carbon capture and storage projects, and allowing the use of renewable energy credits for voluntary offsetting. ANALYSIS: Australia’s carbon market reforms please big industry, but for experts concerns linger
Big emitters have welcomed Australia’s plans to fund bigger emission cuts through the country’s carbon market mechanisms, though analysts warned the far-reaching changes could cause a huge influx of low-quality offsets without addressing the market’s stunted demand. New Zealand won’t clarify fixed price option level ahead of ETS compliance
New Zealand will not clarify whether the fixed price option in its emissions trading scheme will rise to NZ$35 this year until after 2019 compliance has been completed, the government has confirmed.
*AMERICAS* California seeks judgement on WCI ETS linkage, rebukes federal government’s final challenge
California officials are urging a federal court to dismiss the final argument against its ETS linkage with Quebec, while arguing that the Department of Justice’s (DOJ) challenge under the US Constitution’s Foreign Affairs Doctrine represented a significant expansion of power over states. Oregon unable to sell allowances under proposed cap-and-reduce programme
Oregon’s Environmental Quality Commission (EQC) does not have the legal authority to auction permits under the state’s potential carbon reduction policy, but alternative compliance pathways such as trading should not face a similar barrier, a state agency said Monday. PJM electricity generators differing in views of CO2 border adjustment
PJM stakeholders expressed various opinions Tuesday on whether a carbon border adjustment in the wholesale power grid is best for lowering emissions within the 14-jurisdiction region.
*EMEA* Swedish govt, businesses push proposals to strengthen EU market-based climate measures
The EU ETS must be urgently strengthened to help achieve the Paris Agreement’s 1.5C global warming limit goal, the Swedish government and a network of businesses in the country including McDonald’s and Coca Cola said this week, laying out a number of proposals to beef up the bloc’s market-based climate measures. Next EU budget must consistently raise share of climate spend, says senior lawmaker
The next seven-year EU budget must aim to raise the share of the total spending on climate action, potentially gradually increasing it to 30%, a member of the European Parliament’s negotiating team said on Tuesday. EU Market: EUAs extend May peak, stick near €20 to consolidate gains
EUAs dipped on Tuesday but kept close to €20 to consolidate much of the previous session’s major gains, as an auction supply dip looms.
*BITE-SIZED UPDATES FROM AROUND THE WORLD*
*COVID effect -* Daily global CO2 emissions fell 17% year-on-year
*It’s a gas* – Pressure is mounting worldwide to make a clean recovery from the coronavirus crisis, but Australia’s National COVID-19 Co-ordination Commission has different plans, according to the Australian Financial Review
*Ostroleka is gas, too* – Deemed as ‘Poland’s last coal plant’
*Testing negative* – Germany’s controversial new Datteln 4 coal plant in the state of North Rhine-Westphalia is running at full capacity in test operation despite the low demand for electricity on the market, resulting in negative electricity prices and causing losses for green power producers, Tageszeitung reports. German hard coal and lignite-fired power plants saw output drop in April to their lowest in decades due to the significant decline in electricity consumption from the coronavirus lockdown and the above-average production of wind and solar power. Datteln 4, which is scheduled to go online this summer, was the only coal plant still running at full capacity for many days in April, as it began test operations despite the federal government’s decision to phase out coal amid massive protests. It was repeatedly tested at full power, usually on days when there was already plenty of electricity. As a result, the electricity exchange price plunged sharply into the red. On Apr. 21 at midday, it reached -€80/MWh, resulting in no remuneration for renewables producers. (Clean Energy Wire)
*Cross-border -* The European Commission has launched a public consultation
*Integrated *- Simson also announced on Tuesday to EU lawmakers from the ITRE committee that the Commission will present a new strategy on Energy System Integration in June
*Charged up *- The European Investment Bank on Tuesday confirmed it will mobilise €1 bln in support for a “strong, independent” European battery industry in 2020
*Permit pull – *Presumptive Democratic presidential nominee Joe Biden would rescind the cross-border permit granted by Donald Trump that allows the controversial Keystone XL pipeline to cross into the US, effectively killing the project that the current president has made central to his administration. Biden’s statement is the first commitment on how he’d handle the project that has been stalled for over a decade, with President Barack Obama having blocked the pipeline in 2015 while Biden served as vice president. The White House and Alberta government both criticised Biden’s pledge. (Politico)
*Chatterjee chatter* – US Federal Energy Regulatory Commission (FERC) Chairman Neil Chatterjee is considering running for governor in Virginia next year, Politico reports. A Facebook group titled “Hypothetical: Draft Neil Chatterjee for Virginia Governor 2021” was formed over the weekend, featuring a photo of Chatterjee wearing a Washington Nationals baseball cap while holding a gavel. Chatterjee, a Republican tapped by President Trump to lead the commission in 2018, told Politico he was “just playing around” when he created the group, and plans to finish out his term, which ends in June of next year. “My focus from now until June 30, 2021 is on my duties at FERC,” he told Politico. “Only after my term is complete will I start to give any thought to what I do next in life.” The state’s gubernatorial primary, however, is scheduled for June 8 next year, which would force Chatterjee to make the decision before the end of his FERC term.
*Farming clean -* The European Commission is mulling 2030 targets to cut EU fertiliser use
*And finally… Size isn’t everything -* Freshwater fish could end up with bigger brains because of climate change
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