ICAO decides that most probably emissions units generated from mechanism established under the UNFCCC and the Paris Agreement will be eligible for use in CORSIA
The Council of the International Civil Aviation Organization (ICAO), the UN body responsible for global aviation, approved the Emissions Unit Eligibility Criteria (EUC) for Carbon Offsetting and Reduction Scheme for International Aviation, CORSIA. This means what offsets can be used under the new aviation pollutions scheme. And emissions units generated from mechanism established under the UNFCCC and the Paris Agreement most probably will be eligible for use in CORSIA (pending of final approval) among others.
About Carbon Offset Credit Integrity Assessment Criteria, there are a number of generally agreed principles that have been broadly applied across both regulatory and voluntary offset credit programs to address environmental and social integrity. These principles hold that offset credit programs should deliver credits that represent emissions reductions, avoidance, or sequestration that:
– Are additional.
-Are based on a realistic and credible baseline.
-Are quantified, monitored, reported, and verified.
– Have a clear and transparent chain of custody.
-Represent permanent emissions reductions.
-Assess and mitigate against potential increase in emissions elsewhere.
-Are only counted once towards a mitigation obligation.
-Do no net harm.
Also there are criteria for emissions unit programme design elements:
-Clear methodologies and protocols and their development process
-Offset credit issuance and retirement procedures
-Identification and tracking
-Legal nature and transfer of units
-Transparency and public participation provisions
-Sustainable development criteria
-Avoidance of double counting, issuance and claiming
More information here: https://icao.int/environmental-protection/Documents/Resolution_A39_3.pdf
Carbon prices staged a rally late in the month to end February down by just 1.4% at €21.69. EUAs had fallen by as much as 17% at one point during the month as speculative traders unloaded long positions and short-term power plant economics leaned towards natural gas.
Prices have declined by more than 13% since the start of the year as shifting spark and dark spreads have kept utility buying to the sidelines, and the uncertainty of Brexit has held the threat of a UK-based sell-off over the market.
The UK is now entering the final four weeks before Brexit Day, and there is little clarity over whether the country will quit the EU with a negotiated withdrawal agreement — that would keep UK installations in the EU ETS until the end of Phase 3 — and a no-deal scenario, which would see UK installations fall out of the market on March 28.
In the final week of February, UK Prime Minister Theresa May caved in to pressure from lawmakers and confirmed that Parliament will vote in mid-March on whether or not to delay Brexit.
At the same time, energy minister Claire Perry confirmed this week that the UK’s “preferred option” for the post-EU age is to have a stand-alone UK ETS, linked to the EU market. This option is seen as the most likely outcome whether or not the UK leaves the EU under a negotiated settlement.
The energy minister said the government will issue a consultation document on a future UK ETS at the end of April.
Beyond Brexit, the relative profitability of coal and gas-fired power continued to move in favour of natural gas over the course of the month. RWE confirmed it was bringing a number of gas-fired plants out of mothballs this year, suggesting the company had managed to lock in an acceptable margin for the period until 2021.
Market analysts concurred that the clean spark spread is in the money for the front-month and quarter, while coal is competitive on a year-ahead basis.
The outcome is that utility demand for carbon from utilities has been depressed this month, leaving the market vulnerable to volatility generated by speculative traders and options hedging in particular.
Some participants have called the underlying market somewhat thin this month, even though average daily screen volume has been more than 20 million EUAs a day, the most since October, and the third-most since the start of 2018. Options hedging tends to exaggerate price movements and inflate trading volume, so the likely inference is that utilities are very comfortably covered at the moment.
The outlook for March is dominated by issuance of 2019 EUAs, annual compliance and Brexit. UK installations have until March 15 to surrender EUAs matching their 2018 emissions, while the rest of Europe works to a March 31 deadline.
Since the UK is not issuing or auctioning any 2019 EUAs “until further notice”, UK installations may not borrow from future allocation for compliance, There are reports that some UK installations have been caught out by this, but this is not likely to be a major market factor.
Issuance of 2019 EUAs has already begun, and the process should be largely completed by the end of March. The injection of fresh supply may depress prices slightly as industrials decide to borrow for 2018 compliance rather than pay prices on excess of €20, but this is a risky strategy.
Finally, decisions on Brexit may generate some short term volatility as the end of March approaches. A no-deal Brexit risks seeing a surge of selling of surplus EUAs, while a vote in favour of the withdrawal agreement may be met with a relief rally
World’s food supply under ‘severe threat’ because of some factors such as changes in land and water use and management, pollution and climate change
A report launched by FAO, Food and Agriculture Organization of the United Nations, presents mounting and worrying evidence that the biodiversity that underpins our food systems is disappearing – putting the future of our food, livelihoods, health and environment under severe threat.
Biodiversity for food and agriculture is all the plants and animals – wild and domesticated – that provide food, feed, fuel and fibre. It is also the myriad of organisms that support food production through ecosystem services – called “associated biodiversity”. This includes all the plants, animals and micro-organisms (such as insects, bats, birds, mangroves, corals, seagrasses, earthworms, soil-dwelling fungi and bacteria) that keep soils fertile, pollinate plants, purify water and air, keep fish and trees healthy, and fight crop and livestock pests and diseases.
“Biodiversity is critical for safeguarding global food security, underpinning healthy and nutritious diets, improving rural livelihoods, and enhancing the resilience of people and communities. We need to use biodiversity in a sustainable way, so that we can better respond to rising climate change challenges and produce food in a way that doesn’t harm our environment,” said FAO’s Director-General José Graziano da Silva.
The report points to decreasing plant diversity in farmers’ fields, rising numbers of livestock breeds at risk of extinction and increases in the proportion of overfished fish stocks.
The driver of biodiversity for food and agriculture loss cited by most reporting countries is: changes in land and water use and management, followed by pollution, overexploitation and overharvesting, climate change, and population growth and urbanization.
The report also highlights a growing interest in biodiversity-friendly practices and approaches. Eighty percent of the 91 countries indicate using one or more biodiversity-friendly practices and approaches, such as: organic agriculture, integrated pest management, conservation agriculture, sustainable soil management, agroecology, sustainable forest management, agroforestry, diversification practices in aquaculture, ecosystem approach to fisheries and ecosystem restoration.
But, while the rise in biodiversity-friendly practices is encouraging, more needs to be done to stop the loss of biodiversity for food and agriculture. These are often inadequate or insufficient.
You can read the full report here
The European Union passed rules to reduce carbon emissions from trucks for the first time. Under this agreement, emissions from new trucks will have to be 30% lower in 2030 compared to the 2019 emissions.
There is also an interim 15 percent reduction target for 2025 and incentives for manufacturers to make low and zero-emission trucks. The 2030 target is also subject to a review in 2022.
The new legislation will help Member States’ emission targets, incentivise innovation, promote clean mobility solutions, strengthen the competitiveness of EU industry and stimulate employment, while reducing fuel consumption costs for transport operators and contributing to better air quality.
Commissioner for Climate Action and Energy Miguel Arias Cañete said: “With the first-ever EU emission standards for trucks agreed, we are completing the legal framework to reach the European target of cutting greenhouse gas emissions by at least 40% by 2030. The European Parliament and Council have reached an ambitious and balanced agreement. The new targets and incentives will help tackle emissions, as well as bring fuel savings to transport operators and cleaner air for all Europeans. For the EU industry, this is an opportunity to embrace innovation towards zero-emission mobility and further strengthen its global leadership in clean vehicles.”
Tackling emissions from road transport is a key building block of the EU’s efforts to achieve its target to reduce greenhouse gas emissions by at least 40% by 2030 compared to 1990 levels. The CO2 emission standards for trucks complete the EU’s economy-wide legislative framework for achieving this target. They are part of the EU’s contribution to fighting climate change under the Paris Agreement and the Juncker Commission’s priority of a resilient Energy Union and a forward-looking climate change policy.
Global targets to limit climate change are unlikely to be met due to delays in changing the way people use land, according to new research.
Nearly 100 countries pledged to make their use of land less damaging to the climate, mainly by limiting deforestation rates and boosting forest restocking, when they signed the Paris Agreement in 2015.
Many countries planned to prevent deforestation or establish new forests over large areas to absorb carbon dioxide from the air, and to reduce greenhouse gas emissions from agriculture, changes which would remove up to 25% of the greenhouse gases released by human activity every year.
However, the new research shows that such changes in land use usually take decades to happen, far too slowly to help slow climate change to the agreed level.
Dr Calum Brown of KIT, lead author of the study, said: “Our research suggests that many of the plans for mitigation in the land system were unrealistic in the first place and now threaten to make the Paris target itself unachievable.”
Brazil increased deforestation by 29% between 2015 and 2016 despite reductions in the decade before the Paris Agreement was signed, the study says, essentially making the country’s emission promises impossible to meet.
Palm oil cultivation in Indonesia and Peru has also scuppered deforestation efforts and led to increased emissions rates, it says.
“Richer countries have not been leading the way, either in reducing their own emissions or in reducing the pressure on developing nations. And we need to find rapid but realistic ways of changing human land use if we are to meet our climate change targets”, authors say.
You can download the study here
People around the world agree that climate change poses a severe risk to their countries, according to a 26-nation survey conducted by Pew Research Center in the spring of 2018. In 13 of these countries, people name climate change as the top international threat.
There have been substantial changes over time on many of the eight international threats asked about in the 2018 survey. For example, in 2013, well before the Paris climate agreement was signed, a median of 56% across 23 countries surveyed said global climate change was a major threat to their country. That climbed to 63% in 2017, and in 2018 it stands at 67%.
Since 2013, worries about the climate threat have increased significantly in 13 of the countries where data are available. The biggest increases have been in France (up 29 percentage points) and Mexico (up 28 points), but there have been double-digit rises in the U.S., UK, Germany, Spain, Kenya, Canada, South Africa and Poland as well.
Another interesting data is that in seven countries, women are more concerned about climate change than are men. In Poland, 61% of women name it as a major threat, compared with 48% of men.
The last result that we can highlight is that among the three Latin American countries surveyed, global climate change continues to rank as the top concern, extending an established trend. Eight-in-ten Mexicans say climate change is a major threat, marking an 8-percentage-point increase from 2017 and a 28-point increase since the question was first asked in 2013. Almost three-quarters of Argentines (73%) and Brazilians (72%) name climate change as a major threat.
You can download the full report here
Since the COP 21 and the signing of the Paris Agreements, global warming and sustainable development have never been put forward.
While there is no doubt that the number of signatories is history, the Paris Agreement is the result of a 43-year-old gestation.
In 1972, the publication of “Limits to Growth,” a report commissioned by the Club of Rome and prepared by a team from the Massachusetts Institute of Technology, produced for the first-time impact on the issue of sustainability.
Twenty years later, the Rio Earth Summit delivers a first consensus with the adoption of Agenda 21; a 21st century action plan outlining the areas where sustainable development is to be applied in the context of local governments.
It makes recommendations in areas as diverse as poverty, health, housing, pollution, marine, forest and mountain management, desertification, water and sanitation management, agriculture management and waste management.
All these topics that make our daily news … 27 years ago now.
Parallel to this action plan, a declaration on the environment and development is adopted. It lists 27 principles to follow in implementing Agenda 21.
In order to give substance to these compromises, the COP 1 took place in Berlin in 1995. The world is then divided between rich and poor countries, which refuse to bear the responsibility of global warming. Berlin will pave the way for Kyoto, where CO2 reduction targets will be taken two years later, alas with little success.
Twenty years later, COP 21 or the Paris Conference resulted in a new international climate agreement, applicable this time to all countries and aimed at keeping global warming below the 2 ° C threshold, in line with recommendations of the Intergovernmental Panel on Climate Change (IPCC).
Historical by the number of participants and the strength of the commitments made, the Paris Agreement is unprecedented in the negotiations on climate change, the related threats and this in a context of sustainable development and the fight against poverty.
It is accompanied by the adoption of 17 Sustainable Development Goals, the three pillars of which are Economy, Environment and Society (description in the box opposite).
Three years later, however, if multilateral rules for the implementation of the Paris Agreement were finally ratified during COP 24, no short-term measures were imposed.
Despite this, the number of private actors – of any size and sector – committed to tangible sustainability goals in the short and medium term has never been more numerous.
Sustainable development, beyond the climate issue, deals with the management of resources, production methods, consumption and holistic equity. It calls into question our non-regenerative economic model, fruit of the Industrial Revolution which since 1750 exhausts all resources, human included.
A profound paradigm shift is underway in today’s organizations. Companies around the world are boldly leading the transition from a dead-end tactic “to the status quo” to transformative strategies essential for creating a flourishing and sustainable world.
Beyond the demand of consumers more and more attached to values than products, these changes respond to a desire for performance.
Given the requirements, a study conducted by Elan Edelman, a specialist in brand communication, “shows that 65% of French people choose to buy or boycott, according to their perception of the values they defend”.
In terms of performance, today’s most innovative leaders recognize that for the sake of our businesses and our world, we must implement revolutionary – not just progressive – changes in the way we live and work. Let’s go to work.
Imagine a world in which excess energy from one company would be used to heat another. Where buildings need less energy in the world and where “regenerating” commercial buildings – those that produce more energy than they use – are designed. A world in which environmentally sound products and processes would be more profitable than wasteful waste.
All these solutions exist today, fruit of daring innovations from multinational or SME, scientific research or common sense. There is a multitude of strategies that individuals and organizations can use because The Paris Agreements certainly will make history, it is up to the private sector – fully empowered – to write it down.
17 Sustainable Development Goals – United Nations.
“The SDGs came into effect in January 2016, and they will continue to guide UNDP policy and funding until 2030. As the lead UN development agency, UNDP is uniquely placed to help implement the Goals through our work in some 170 countries and territories.
Our strategic plan focuses on key areas including poverty alleviation, democratic governance and peacebuilding, climate change and disaster risk, and economic inequality. UNDP provides support to governments to integrate the SDGs into their national development plans and policies. This work is already underway, as we support many countries in accelerating progress already achieved under the Millennium Development Goals.
Our track record working across multiple goals provides us with a valuable experience and proven policy expertise to ensure we all reach the targets set out in the SDGs by 2030. But we cannot do this alone.
Achieving the SDGs requires the partnership of governments, private sector, civil society and citizens alike to make sure we leave a better planet for future generations.”
At least a third of the ice in the Hindu Kush Himalaya region, an area that includes the world’s highest peaks Mount Everest and K2, could melt by the end of this century according to the authors of a new report titled The Hindu Kush Himalaya Assessment: Mountains, Climate Change, Sustainability and People.
Glaciers have been retreating and thinning in the area since the 1970s, the report says, but there’s been an accelerating rate of retreat since then. This loss has caused severe economic damage and floods, landslides and deadly epidemics. Global warming has also reduced snow cover and degraded permafrost.
Climate change will reduce how much food farmers will be able to produce in this part of the world. About 70% of the population of this region are farmers, and there is already great food insecurity there.
Also, warmer water temperatures will encourage the growth of invasive species. Extreme floods and droughts may “destroy the food production base of the region,” the report said. Rivers that farmers and energy companies rely on, like the Ganges, Yangtze, Mekong and Indus, will also be hurt by glacier melt.
Ultimately, climate change will probably increase the risk of violent conflict and add to the political instability.
The report says that “in spite of its importance, relatively less is known” about the region and its ecosystems. The authors hope it will be used to encourage cross-border cooperation among the regions leaders to find ways to prevent the potential devastation that climate change can bring.
You can read the report here
Earthquakes and tsunamis accounted for the majority of the 10,733 lives lost in disasters last year while extreme weather events accounted for most of 61.7 million people affected by natural hazards, according to analysis of 281 events recorded by the Centre for Research on the Epidemiology of Disasters (CRED) in its EM-DAT (International Disaster Database).
Seismic activity including earthquakes, tsunamis and volcanic activity disrupted the lives of 3.4 million people last year and claimed more lives than any other hazard type.
Floods continued to affect the largest number of people, 35.4 million people. Storms affected 12.8 million people last year and caused a recorded 1,593 deaths. It is anticipated that storms, particularly due to hurricanes Florence (14 billion USD) and Michael (16 billion USD) and typhoon Jebi (12.5 billion USD), will be the costliest type of disaster of 2018 once final economic losses are compiled.
Wildfires in Europe and North America claimed a record number of lives as Greece (126) had the deadliest European wildfire on record, and the United States (88) had its deadliest wildfire in over a century, and costliest wildfire on record (estimated 16.5 billion USD).
The CRED statistics highlight that 9.3 million people were affected by drought worldwide. Debarati Guha-Sapir, head of CRED at UCLouvain, said: “The impact of all disasters, particularly drought and extreme temperatures are notoriously poorly reported, especially from low-income countries. The human impact of these events, are difficult to quantify, but it needs to be done urgently, especially in order to report on specific SDG target indicators. Therefore, innovative approaches that measure progress in resilience and the adaptive capacity of communities needs to be addressed by appropriate UN agencies.”
UN member States are committed to reducing disaster losses and implementing the Sendai Framework for Disaster Risk Reduction (2015-2030), the global plan for reducing disaster losses which has a clear focus on reducing mortality and the numbers of disaster affected people, as well as reducing associated economic losses and damage to critical infrastructure.
More information here
The carbon market’s strong rally into the end of 2018 came to a sharp stop in January, as EUAs failed three times to breach the September high of €25.79. The December 2019 futures contract ended the month down almost 11% from the December 31 close at €23.30.
The extreme volatility of the fourth quarter, mainly the result of options hedging, gave way to a slightly calmer environment, though traders were quick to exploit opportunities to drive prices higher mid-month. The failure to top the existing ten-year high then triggered selling as speculative traders liquidated positions.
The market was also characterised by a growing flow of bearish news and sentiment. The ongoing trade disputes between the US and various countries appears to be making itself felt in worsening economic prospects: US and German business confidence took a knock this month, while the US Federal Reserve displayed a new-found caution in its interest rates policy, preferring to hold rates stable and wait for further data.
Fundamentals in the carbon market also shifted this month. In 2018 coal-fired power was the more profitable choice in the benchmark German market, but as the new year started, natural gas prices have fallen back amid plentiful global LNG supply, and this has rendered gas-fired power competitive for calendar 2020 and 2021.
Coal prices, too, have not helped. API2 calendar 2019 coal prices rose into the $90s in October last year, but fell back to the low-mid $80s quickly after that, and there has been little reason for them to rise since.
As a result, utilities are reluctant to sell forward power from coal plants, and this has damped demand for EUAs. There may also be an element of reduced demand ever since RWE announced that it was financially covered for carbon until 2023: other utilities will no doubt have followed suit.
Weather has also been a factor in January. Temperatures have not dropped to significant below-average levels, and this has hurt demand for heating. The weather outlook for February is still fluid, but there remain chances of a prolonged cold snap, meteorologists say.
Supply in February will be boosted by the resumption of weekly German EUA auctions, which will increase total February availability to 51.6 million EUAs compared to 38.8 million in January.
Despite the additional auction supply, there are some participants who hold a slightly bullish outlook for the month, however. Analysts calculate the market balance as short by more than 10 million EUAs in February, which could boost prices. At the same time, compliance buyers will be on the look-out for opportunities to buy cheap carbon, and this may mitigate downward price potential.