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In April, the Korean parliament passed legislation to establish a carbon emissions trading system starting on January 1, 2015. Unlike in Australia, there was almost no public debate about the reform. Although the main business group, the Korean Federation of Industry, opposed it, lawmakers on all sides of the legislature combined to vote for it – 151 ‘yes’ votes and three abstentions. Why is this story so different from Australia’s torturous route to a carbon price? Basically, it’s down to good political management and the integration of the carbon emissions trading concept into a much broader industrial policy. Here is how it happened...
Bavaria's stock exchange will abandon its carbon emissions certificate trading operations in the EU-traded CO2 market on June 30 after volumes in Europe "plunged to practically zero" in recent months, it said on Tuesday.The EU's emissions trading scheme (EU ETS) limits the carbon dioxide emissions of the 27-nation bloc's factories and power plants and covers nearly half of EU emissions. Bavaria's stock exchange will abandon its carbon emissions certificate trading operations in the EU-traded CO2 market on June 30 after volumes in Europe "plunged to practically zero" in recent months, it said on Tuesday. Prices in the ETS have shed around 60 percent of their value over the past year due to market worries about the growing supply glut and weak demand. "Emissions trading will never find its feet again without radical political action," said Christine Bortenlaenger, the head of the exchange, in a statement. "To actually achieve the original goal of reducing carbon emissions, trading prices must be boosted by drastically reducing the number of certificates. Only then will companies perceive investment in carbon reduction technologies as worthwhile," she added. The bourse cited the uncertainty caused by the euro zone debt crisis which hampers industrial activity and hence the need to hedge or bring down carbon emissions output.
By a vote of 148-0 South Korean lawmakers have just approved a national emissions trading program to reduce the global warming pollution from its largest sectors by 2015. South Korea is the world’s eighth largest emitter of carbon pollution from fossil fuel burning so this is an important signal from one of the world’s largest players. This program would mark an important step in South Korea following through on the commitment it made in Copenhagen to cut its global warming pollution to 4 percent below 2005 levels. This announcement follows on the heels of the passage of national global warming legislation in Mexico.
The UK government has unveiled draft legislation to reform the country’s electricity market to incentivise renewable energy, nuclear power and carbon capture and storage. Its long-awaited Electricity Market Reform (EMR) bill is intended to deliver the UK’s climate change goals, at least cost, while ensuring a diverse mix of generating capacity, Ed Davey, Secretary of State for Energy and Climate Change, told reporters today. “We’re trying to create a system where low-carbon power can compete in the market,” he said.
Shea Homes is pushing energy efficiency in Brentwood, where it is constructing homes that it says will come with no electric bills, the Contra Costa Times reports. The homes are being built with solar power installed, as well as energy-efficient heating, ventilation and air-conditioning systems. The company says the program is limited, since it relies on state solar rebates for builders.
American drivers will face higher gasoline prices if the Keystone XL Tar Sands pipeline from Canada to the Gulf of Mexico were built, according to a new analysis by the Natural Resources Defense Council. That finding adds to the long list of reasons why the proposed pipeline should not be built, said the study, released today. “The pipeline’s proponents say it’s the solution to high gas prices. The truth is exactly the opposite —the pipeline would raise gas prices,’’ said Anthony Swift, NRDC attorney. “This is one of the most misunderstood issues surrounding this misguided Canadian project.” If built, the Keystone XL pipeline daily would transport up to 830,000 barrels of the world’s dirtiest oil through America’s heartlands and breadbasket—diverting oil from Midwestern refineries, which now produce more gasoline per barrel than any other region in the United States. “The result would be less gasoline for American drivers—and higher prices at the pump,’’ Swift said.
By June 15 gasoline-powered augers will have drilled 100 holes in the corn, cotton and peanut fields of the Lower Flint River Basin in southwest Georgia. Into the holes, scientists from the University of Georgia (U.G.A.) will slip half-meter-long PVC pipes filled with sensors for soil moisture and temperature topped with a flexible antenna that can be run over by a tractor and spring back into place. Over the course of the next two years, these sensors will continuously relay soil conditions from 20, 40 and 60 centimeters deep to a computer. Combined with more accurate weather forecasts, the data will help farmers decide where and when to use their irrigation systems.
Companies covered by the EU emissions trading scheme (EU ETS) are racing to hand in so-called "grey credits" generated by plants destroying industrial gas before their use is banned. The 12,000 participating installations can meet their carbon targets using EU Allowances (EUAs) or import a certain number of UN-backed offsets, known as Certified Emission Reduction credits (CERs) or Emission Reduction Units (ERUs). Around 179 million CERs were submitted last year out of an overall total of just under 255 million UN-backed offsets, which represents an 86 per cent increase on 2010, new research by Thomson Reuters Point Carbon revealed yesterday. However, 84 per cent of the CERs handed in were from HFC and N2O adipic acid projects, which will be excluded from EU ETS from 2013 amidst concerns over the credibility of some industrial gas emission reduction projects. The EU was moved to take action following claims some Chinese project developers were deliberately manufacturing and then destroying the gases to generate credits, which can be sold for 70 times the actual cost of destroying HFC-23.
Camco International reported on Tuesday a 2011 loss of 29.2 million euros ($37 million), compared with a profit of 10.1 million euros in 2010, as the value of the company's carbon portfolio got hit by record low carbon prices. Camco, a developer of low-carbon and clean technology projects in North America, Europe, Asia and Africa said its results were adversely affected by a sharp drop in carbon prices due to flagging demand for carbon credits and a glut of supply. The carbon credits, called certified emission reductions, lost around two thirds of their value last year, as a record number of credits were issued in the face of an economic slump in the European Union, the biggest market for those credits. "For the short term, the price shock has put pressure on our business to adjust to a new environment," chief executive Scott McGregor said in a statement. "In the medium to long term we continue to believe that as action is taken by regulators and governments, market inefficiencies will be corrected," he said, referring to EU officials reviewing ways to tackle the oversupply of carbon units in the world's biggest carbon market.
Britain introduced its electricity market reform proposals to Parliament on Tuesday, a crucial legislative step to push through new rules to reduce carbon emissions, keep the lights on and shelter consumers from extortionate bills. Secretary of State for Energy and Climate Change, Edward Davey, on Tuesday confirmed the new power market mechanisms the government had outlined late last year, such as guaranteeing a minimum electricity price to producers of low-carbon energy, including nuclear, and creating a back-up capacity system to complement intermittent renewable energy.
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