This Week In V-Carbon: UN Negotiators Consider “Nesting” of Current Forest Carbon Projects

The Sochi 2014 Organizing Committee announced this month that next year’s Olympics will be the first to mitigate not only direct emissions from the Games, estimated at 360,000 tCO2e, but also emissions from spectator and media travel, estimated at 160,000 tCO2e. Dow Chemical Company, the “Official Carbon Partner” of the Games, will pay for the offset purchases, sourced from the Bikin Tiger project in Russia as well as projects in Brazil and South Korea, where the next two Olympics will be held. Nick Nuttall, communications director at the United Nations Environment Programme, said highly visible sports events like the Olympics provide an opportunity to “push the barriers” of climate neutrality.

– Read more about how the Olympics is going carbon neutral
– Read remarks by Nick Nuttall

An enhanced carbon emissions calculator released this month will allow United Airlines customers to more easily calculate their shipping emissions, based on origin and destination of flights and shipment weight. United Cargo says that the calculator will help them efficiently respond to shipping request-for-proposals, which more and more often require emissions data. After calculating their emissions, customers can choose to offset them through United’s current project portfolio, which includes a forest conservation project in California’s redwoods, a wind project in Texas, and an avoided deforestation (REDD+) project in Belize.

– Read more in the Wall Street Journal

A pilot project in North Dakota will store carbon under the newly approved Avoided Conversion of Grassland and Shrublands Methodology by the American Carbon Registry (ACR). The project brings together 114 landowners to employ no-till practices across 50,000 acres of land, though grazing and haying may continue. “Basically, you’re farming carbon while running a normal diversified agricultural operation,” said Adam Chambers, of the US Department of Agriculture’s (USDA) Natural Resources Conservation Service, one of the project partners, along with Ducks Unlimited. The pilot project is funded by a $161,000 USDA grant, though the hope is that it will lead to carbon finance to stop grasslands conversion and its associated emissions of 20-75 MtCO2e per acre.

– Read more from the USDA
– Read more from Ducks Unlimited

The UK government’s Insolvency Service has closed down 19 companies involved in a carbon credit scam that duped more than 1,500 people out of 24 million pounds (US$38 million). The victims – many of them elderly people investing their retirement savings – were told that their money was going towards carbon credits that would then be purchased at a premium by companies like British Airways and Marks & Spencer (who were not actually involved), yielding up to 40% returns. In fact, the volumes of credits they held were too modest to trade. Eco Global Markets Limited, Aglo-Capital Partners Ltd and Cavendish Jacobs Ltd were among the scammers.

– Read more from BBC

In concurrence with the opening of the UN climate negotiations in Warsaw, the Gold Standard yesterday announced its Land Use & Forests Framework and Requirements for afforestation and reforestation projects. “Rather than just paying people to stop cutting forests, this approach recognises that for genuine and long-lasting success, governments and other buyers of carbon must consider and address the drivers of deforestation and the nexus of energy, water, land use and development – reflecting the integrated nature of human activity,” the press release explains. Forest projects in Uganda, Panama, and Costa Rica have already transitioned to the land-use approach, with five new projects – in Honduras, Peru, China, Nicaragua, and Hawaii – currently being developed under the framework.

– Read more about the Framework
– Check out the Gold Standard’s COP19 side event

– Read the press release
– Read the article in GreenBiz

The International Emissions Trading Association (IETA) today released its annual publication, IETA Greenhouse Gas Markets 2013, that analyzes major developments in carbon markets worldwide. Under current projections, within a couple of years almost a quarter of the world’s emissions will occur in jurisdictions where there is a carbon pricing policy in place, the report finds. Its chapters, all written by different authors, examine existing and emerging domestic carbon markets; the design of these markets, including ideas on how to align them; and current tools for financing low carbon development. Contributors included Shell, Rio Tinto and the US government.

– Read the press release
– Download the report

Mexico’s stock exchange, the Bolsa Mexicana de Valores (BMV), last Friday announced the launch of an electronic platform to trade carbon credits. The exchange will offer United Nations Certified Emissions Reductions (CERs) as well as voluntary market-certified offsets. The move comes on the heels of the fiscal reform bill that passed in the Mexican Senate last week, introducing a new carbon tax on fossil fuels which, if changes pass the lower house, will go into effect in 2014. Companies with shares in the BMV will also be invited to set emissions reductions targets outside of the tax. An upcoming presentation in Mexico City on Nov. 26 will offer more details on the carbon exchange.

– Read more

US President Barack Obama issued an Executive Order that directs government agencies to draft plans to prepare for the impacts of climate change. Federal money in the past has covered replacing structures after storms but not “upgrades,” but the Executive Order may make it easier for states and communities to design infrastructure like roads, bridges and flood control with future climate conditions in mind. A high-level task force of governors, mayors and other local leaders will help identify hurdles to building resilience. Though the focus on adaptation marks a shift in federal policy, the United States remains committed to its goal of reducing greenhouse gas emissions 17% under 2005 levels by 2020.

– Read more in the New York Times

Yeb Sano, the head of the Philippines delegation at the UN climate talks, announced that he will stop eating until negotiators make “meaningful” progress. He says his fast is in solidarity with the thousands of Filipinos struggling to find food and water after Typhoon Haiyan made landfall on Nov. 8. Preliminary estimates are that 10,000 people died in the storm, which was the strongest tropical cyclone on record to hit land. The Philippines government has connected the typhoon with climate change. “The energy that is stored in the waters off the Philippines will increase the intensity of typhoons and the trend we now see is that more destructive storms will be the norm,” Sano said.

– Read more about Typhoon Haiyan
– Read more about Sano’s fast

John Kilani, director of the sustainable development mechanisms division of the UNFCCC, says that many governments’ proposals for a 2015 agreement mention the use of CERs. Despite crashing CER prices, parties to the Convention are moving beyond the “rigid view” that the Clean Development Mechanism (CDM) is tied to the Kyoto Protocol, Kilani says. However, as the pipeline for emissions reductions projects slows, the CDM board called for a $5.5 million budget cut for 2014, putting their budget at $32.9 million.

– Read more about the CDM after Kyoto
– Read more about the CDM budget cut

EU member states tentatively agreed on Friday to withhold 900 million CERs from the market until later this decade. The “backloading” provision is meant to address the oversupply of credits on the European Union Emissions Trading Scheme (EU ETS). Member states still need to formally ratify the proposals, with a final agreement expected in the next two weeks. Poland and Cyprus are reportedly the only two countries that still opposed backloading at last week’s talks. Former skeptics such as Greece have come around to the idea. However, analysts say that it may be years until European carbon prices rise to 40 euros per tCO2e, the estimated price level needed to incentivize companies to switch to renewable energy or invest in energy efficiency.

– Read more

After launching its carbon market in Shenzhen in June, China plans to expand emissions trading to Beijing, Shanghai and Guangdong province as early as the end of the year. Planned carbon markets in Tianjin, Chongqing and Hubei are farther behind. So far, the Shenzhen market, which covers 635 industrial facilities, has traded fewer tonnes than anticipated – 113,000 tCO2e, worth a total of 7.25 million yuan (or US$9.16 million). The Shenzhen market is considered a pilot and will inform China’s national emissions trading scheme, expected to begin as early as 2016. Chinese credits are expected to trade at $5/tCO2e, at least at first.

– Read more about emissions trading in China
– Read more about credit prices in China

The British government has allocated 250 million pounds (US$400 million) over the next two years to help companies pay for indirect costs associated with carbon policies; 16 million pounds (US$25.5 million) have been paid out so far. Tata Steel, Celsa Steel and chemical company Ineos Chlor Vinyls are among the 17 companies that have received payments. Britain’s domestic carbon tax is 4.94 pounds per tonne, set to rise to 18.08 pounds per tonne in 2015 and then again to 30 pounds per tonne in 2020. The tax is meant to drive investment in low-carbon power generation, while the compensation is meant to shield industrial facilities from higher energy bills.

– Read more

Documentation from September’s workshop on domestic offset schemes, held in Zí¼rich, Switzerland, is now available for download – just in time for the UN Climate Talks in Warsaw. The workshop featured presentations about domestic offset programs in Switzerland, France, Spain, Australia, and California and considered offset programs of varying scale and stringency. “With the declining importance of the two multilateral flagship schemes – the Clean Development Mechanism and the Joint Implementation Tracks – the focus of the offset market rapidly shifts towards the domestic offset schemes,” a press release about the workshop states.

– Check out conference documentation

Just because something is invisible doesn’t mean it doesn’t have implications for investment. This is the gist of a recent op-ed by former vice president Al Gore and senior partner David Blood, both now of Generation Investment Management, in the Wall Street Journal. The op-ed explains that a “carbon asset bubble” has formed as investors confuse unquantifiable “uncertainty” with quantifiable “risk,” – incorrectly assuming that climate change impacts fall into the former category. The authors argue that investors should consider at least two-thirds of fossil fuel reserves to be “stranded carbon assets”…lest we be left cleaning up a popped carbon bubble mess.

– Read more

“Tax” is often seen as a dirty word. But a recent Organisation for Economic Co-operation and Development (OECD) study finds that market-based mechanisms such as carbon taxes and emissions trading are the cheapest ways to reduce CO2 emissions. And yet, higher-cost policy measures – such as subsidies and feed-in tariffs – are often used instead simply because their costs are less obvious. For example, the study found that feed-in tariffs reduce emissions at 169 euros per tonne while emissions trading systems produce the same result for a fraction of the price – about 10 euros per tonne. “Countries are pricing carbon in a multitude of ways, not always the most effective,” said OECD Secretary-General Angel Gurrí­a.

– Read more

The thousands of scientists on the International Panel on Climate Change (IPCC) try to keep their work under wraps until the official release date of their report, now in its fifth edition. But with drafts flying back and forth over the interweb, sometimes things get leaky. This is just what happened earlier this month, when a draft of the impacts and adaptation section slipped out before its scheduled March 2014 publication. The draft suggests that global warming could reduce agricultural production by 2% every decade, even as demand rises as much as 14% per decade. These findings have serious implications for global land use and could further threaten the forests that remain the few remaining sinks of carbon dioxide.

– Read more

A study by researchers at MIT and Tsinghua University compares provincial cap-and-trade programs in China (which is what the country is currently developing) to a national scheme (a future possibility). Published in Energy Economics this month, the study found that either method could get China to its goal of reducing CO2 intensity 17% by 2015, relative to 2010 levels. However, a national emissions target, with trading across provinces, would result in a 20% lower welfare cost by allowing industry to pursue the lowest cost abatement measures across the entire country. Future research by the MIT/Tsinghua group will compare different designs for emissions trading programs.

– Read more about the study
– Download the study

Based anywhere, the two new members of the Technical Advisory Committee will provide expert advice and strategic input to The Gold Standard, with a specific focus on climate-smart agriculture and land use & forestry. Candidates must have 5-10 years experience in applied agricultural science; experience with Fairtrade Standards is an asset. Committee members are expected to commit at least 5% of their time to Gold Standard activities.

– Read more about the position here

– Read more about the position here

Based in Malawi, the MRV Specialist will manage the implementation of carbon development work plans for the USAID-funded integrated REDD Demonstration Program. The position requires managing field surveys, collecting and analyzing spatial data, coordinating training sessions in communities, and communicating with the Terra Global Capital team in San Francisco. Candidates must have an advanced degree in a relevant field, 8 years of work experience in the natural resources sector, at least 5 of which must be in Africa, preferably Malawi.

– Read more about the position here

Based in Quebec, Canada, the Executive Director will provide overall strategic leadership to the Global Call for Climate Action, a network of more than 400 national and international organizations. Key responsibilities include managing relationships with partners and decision-makers, overseeing a $3 million annual budget, and leading powerful communications initiatives. The successful candidate must have a track record of providing visionary leadership, and be politically savvy and internationally minded.

– Read more about the position here

Based in India, the consultant will provide research and analytical support to the Climate Policy Initiative’s India program, working with government and business to design practical, implementable policy options. The position requires rigorous quantitative evaluation of national and international climate and energy policies, an understanding of financial models, and strong writing and editing skills. The ideal candidate will have a master’s degree in a relevant field and 5+ years of experience analyzing the economics of policy choices.

– Read more about the position here

Based in London, the Carbon Markets Analyst intern will work with IDEAcarbon’s publication team starting in December. The position involves delivering the core content for IDEAcarbon’s daily and weekly carbon markets investment research products. The successful candidate will have degree-level education, knowledge of climate change policy, advanced Excel skills, and IT literacy.

– Read more about the position here