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V-Carbon Lets a Hundred Flowers Blossom…

…this week propagating developments along the path to the Next Big Thing. Latin America sprouted a new climate exchange while its northern neighbors branch into the Canadian carbon market. Not everything is coming up roses Down Under, though, as one company is caught in the thorns of a carbon neutral controversy.

NOTE: This article has been reprinted from Ecosystem Marketplace’s Voluntary Carbon newsletter. You can receive this summary of global news and views from the world of voluntary carbon automatically in your inbox by clicking here.

25 April 2011 | Spring has again sprung for voluntary carbon as players sow seeds of market maneuverings while waiting for greater clarity around the California market.

According to Point Carbon’s weekly carbon market newsletter, the California market for compliance offsets has been slow growing (bid/ask prices were virtually unchanged last week at US$10.75/$11.5). This is partly due to concerns that the credits’ holders – not the original project owners – are liable for offsets deemed unacceptable for compliance use post-purchase.  

The International Emissions Trading Association hopes to fertilize debate around the issue. IETA, along with other groups, is making an effort to convince the California Air Resources Board to introduce an insurance pool to protect offset owners who have no control over the projects.

Elsewhere, climate exchanges new and current are trying out some new varieties. For VER spot trading platform Carbon Trade Exchange, this meant transplanting its headquarters from London to Australia, in hot pursuit of an Aussie carbon price.

Celfin Capital and Fundacií³n Chile also launched the Santiago Climate Exchange (SCX), hoping to propagate new demand for carbon credits in Latin America from a popular model. Climex’s Jeroen van de Kletersteeg meanwhile informed Ecosystem Marketplace of Climex’s plans to stick with its garden variety auction platform – as “a great hybrid between brokerage and trading platforms or exchanges.”

Australia-based Shift2Neutral sowed discontent down under, reaping bad press around an allegedly fraudulent carbon neutrality deal, while neighbor Brokers Carbon sprouted a new search-based platform for brokering credits from a variety of project types and stages.

As Ecosystem Marketplace brings you these and other stories in this huge issue of V-Carbon News, it is also in process of harvesting the biggest stories from 2010 for the State of the Voluntary Carbon Markets 2011 report.

Through the end of the month, Ecosystem Marketplace continues to assemble its coalition of sponsors for the headline report. This year, we’ve captured an unprecedented response rate and data quantity (thanks to suppliers!) to offer the most accurate assessment yet of the voluntary carbon market’s size and trends.

Read more about sponsorship opportunities for both the State of the Voluntary Carbon Markets and State of the Forest Carbon Markets 2011 reports, and contact Molly Peters-Stanley (voluntary carbon) or David Diaz (forest carbon) for more information.
—The Editors

For comments or questions, please email: vcarbonnews@ecosystemmarketplace.com.


V-Carbon News

Voluntary Carbon

Climex renews vows to credit auctions

When Climex announced it was shuttering its spot-trading platform in March, many thought it was the end of the line for this Amsterdam-based carbon trading platform. New boss Jeroen van de Kletersteeg, however, says the exchange will continue hosting auctions – including a VER auction to be held in June. Climex, says Van de Kletersteeg, will not seek to renew spot trading, but will instead focus exclusively on hosting auctions for both buyers and sellers of credits in both the voluntary and compliance markets. In the the next VER auction in June, a large corporate buyer of voluntary carbon offsets will be purchasing Voluntary Carbon Units (VCU) via the platform.

Read more at Ecosystem Marketplace


ODS are in their favor

Cargill has joined forces with EOS Climate to take the climate battle to the California streets – in search of buyers for their climate and ozone-friendly credits. Cargill will act as a financial and primary marketing partner to EOS, a San Francisco-based project developer generating emission reduction credits for the voluntary and emerging Californian carbon markets by destroying ozone-depleting substances (ODS) found in old equipment and infrastructure. Says EOS Climate CEO, Joe Madden, “This partnership validates our model and this credit type, and strengthens our ability to address the global environmental threat posed by refrigerants at or near end-of-life.”

Read the press release
Read more from the Minneapolis/St. Paul Business Journal


O Canada, we stand on guard for trees

Just two weeks after announcing their landmark carbon offset deal in the DRC, ERA Ecosystem Restoration Associates Inc. (ERA) has come out with another partnership that could generate up to 450,000 made-in-Canada VERs. ERA will team up with CSQ Environmental Technologies Ltd. to develop the forest carbon project, phase one of which will involve the restoration of 199 ha of degraded bare land to native white spruce forest near Fort St. John, BC. The reestablishment of a native forest ecosystem in the area is expected to enhance watershed protection while increasing habitat for birds and other wildlife. Delivery for the VERs is expected to be 150,000 per year in 2011, with an option for ERA to acquire 150,000 more in both 2012 and 2013.

Read the press release


Norse sense reinventing the wheel

A thousand years after Lief Erickson, the Climate Action Reserve is “discovering” Canada again – this time for the True North’s potential for carbon projects under Reserve protocols. By the end of 2011, CAR plans to adapt three of its existing protocols – for livestock, organic waste digestion and organic waste composting projects – to the Canadian situation. The Reserve is also has plans to adapt for Canadian use two protocols currently under development, involving cropland management and nutrient management projects. RFP’s from practitioners seeking to assist in protocol development are due to the Reserve on May 13, 2011. It is also seeking a Canada-based contractor to coordinate protocol adaptation – applications are due for that position on May 6, 2011.

Read more from CAR


Carbon Trade Exchanges places

Carbon Trade Exchange (CTX) is taking cues from the Aussie government’s pledge to price carbon – and moving its headquarters accordingly. The online platform for spot trading VERs is relocating its headquarters down under, from London to Sydney, along with its sister company Ventura Carbon – a move expected to create at least 106 jobs over five years. The change comes as the Australian government prepares to put a price on emissions, which many expect could turn Sydney into a regional trading hub for carbon. “Australia’s transition to a low carbon economy over the next decade will present opportunities for businesses specializing in carbon reduction technology, consulting services, research and trading, creating hundreds of new jobs in multiple sectors,” said CTX CEO Wayne Sharpe.

Read the Bloomberg article


Don’t take candy from strangers

Shift2Neutral is once again accused of some, ah, shifty business – this time over an allegedly fraudulent deal with a Sydney school. Oakhill College decided to go carbon neutral last year, in part by offsetting its unavoidable emissions with forest carbon credits from a Malaysian REDD project. But concerns are being raised over the legitimacy of the certificates provided by the company. According to founder Brett Goldsworthy, the offsets were generated through partnerships with a Korean waste management company, Giant Star, and a logging company, Forest Enterprises Australia. While Giant Star has yet to be located, Forest Enterprises Australia is in receivership – but no mention of financial transactions between the two companies has been found.

Read the Sydney Morning Herald article


Carbon trading: take it or leave it

“X” marks the spot for John Melby, who Green Exchange (“GreenX”) announced as its new Managing Director for North American Markets. Melby joins GreenX at a time when both the exchange and his former employer, APX (now NYSE Blue), are in hot pursuit of a leg up on the California compliance market – with GreenX aiming to launch compliance offset contracts later this year. In other news, CarbonDesk brokers based in Geneva mentioned to Thompson Reuters’ Point Carbon reporters their intention to abandon the relatively new office at the end of the month – just six months after it opened.

Read more about Melby’s appointment


FTSE-100 plays footsie with offsets

Low intensity emitters in Britain’s FTSE-100 Index are small enough to dodge the region’s regulatory bullets – but may find that flirting with offsetting emissions isn’t enough to escape the scrutiny of CSR reporting. A report recently released by allowance-based offset supplier Carbon Retirement found that FTSE-100 companies offset 0.1 percent of company emissions. Most companies buying offsets were in the non-carbon intensive sectors (90 percent) – particularly financial institutions. The report reviewed publicly available data and companies’ CSR reporting to conclude that some of the UK’s most highly capitalized companies could make a real dent in global voluntary emissions reductions by following the lead of those sectors that have gone public with their affection for offsetting.

Read more from Reuters
Read more from BusinessGreen
Read the report


UK takes an offset gamble

Climate finance hits jackpot in the UK, which will later this month launch the world’s first carbon offsetting lottery. The web-based scheme is designed to incentivize green behavior by offering businesses and individuals the chance to offset their emissions while getting a chance to win a weekly £3.5 million jackpot. Players choose their numbers online, calculate their carbon footprint, and are then told how many £2 tickets they need to offset their emissions. Worth 100kg/CO2 each, the average UK resident would need to buy two tickets a week to be carbon neutral. A quarter of each ticket price goes to support VCS-verified projects in the developing world. If successful in this test market, other European countries could soon roll the dice on similar schemes.

Read the BusinessGreen article


TreeHugger embraces Carbonfund.org, Terrapass

The votes are in and the readers have spoken – and they love Carbonfund.org. The Maryland-based offsets provider came first among carbon offset providers in TreeHugger’s Best of Green: Reader’s Choice awards, garnering 35 percent of the vote. Terrapass came in a close second with 28 percent – despite being selected as the overall winner by the TreeHugger team – followed by Native Energy, Clear Offset, ClimateCare and the Climate Trust. The annual awards aim to showcase excellence in sustainability in more than 200 categories across eight topics.

Read more about the reader’s choice awards
Read more about the overall winner


Religiously green

Right on sisters! Quebec’s Soeurs de l’Assomption de la Sainte Vierge are now the first religious organization recognized by the Vatican to preach the gospel of (and sell!) carbon credits. The 9,358 credits were generated though an energy switching project and the implementation of other energy efficiency measures. The Congregation has modernized its heating system using geothermal energy to replace the oil light system – an endeavor which involved drilling 88 wells. “By investing in the environment, we wish to leave a better world to future generations” explains Sister Huguette Moreau, responsible for the project. The credits were sold to L2I Financial Solutions and then to the Greening Canada Fund, which purchases community-based Canadian offsets for its investors.

Read the Benzinga article


Online offsets off the hook

Melbourne-based Brokers Carbon are taking supplier consolidation to a whole new level with their recently launched online portal for carbon offset projects. Not to be confused with a trading platform, the portal allows users to search projects by the market in which they’re sold (compliance vs. voluntary), the project’s status (early stage to issued) and then deal directly with sellers or developers as an investor, offset buyer or developer. “What makes this portal so unique in the carbon market is that we already have the ability to list every type of environmental project, in every carbon market, at any stage of development… worldwide,” said founder Nathan Dale. “What we are trying to do is put relevant project information in the hands of the people who can do something useful with it.”

Read the NewsMaker article


Don’t spend it all in one place

After four years of work on the The Proyecto Mirador efficient cookstove project, the accolades – and the VERs – are rolling in. Last week, the Honduran project announced all at once its Gold Standard certification, sale of its first VERs and receipt of two awards from the US government. “Although it took 4 years of hard work, the sale of these VERs has transformed the economics of our project,” said Richard Lawrence, Director of Proyecto Mirador. In related news, the Gold Standard recently released a new methodology for technologies and practices to displace decentralized thermal energy consumption. Building on the current cookstove and biodigester methodologies, the new methodology extends the scope to include GHGs from non-domestic appliances.

Read the press release
Read more about the new methodology


Keeping emissions at Bay

In early April, tireless volunteers got down and dirty on the shores of the Chesapeake Bay, slogging through the mud in an effort to plant over 2,300 carbon-sequestering trees on a former farm. The effort was funded by Washington Gas Energy Services Inc. (WGES) and Sterling Planet, who have collectively donated US$150,000 to the Chesapeake Bay Foundation’s (CBF) Carbon Reduction Fund. WGES has been working with Sterling Planet on its CleanSteps Carbon Offsets program, which allows consumers to buy greener energy and support other carbon reduction efforts – an investment they expect to generate US$250,000 per year for CBF projects. According to the groups, the trees planted represent the equivalent of burning 77,503 fewer gallons of gasoline over the 30 year lifespan of a tree.

Read more from TradersHuddle.com
Read more from the Capital


Poles vaulting into afforestation

Carbon Friendly Solutions (CFS) hopes to clear the verification bar for its Northern Poland Afforestation Offset Project PDD – in a region with only a handful of offset projects according to the web-based Carbon Catalog. The forest carbon project was submitted for review under ISO 14064-2 by Conestoga-Rovers & Associates. CFS plans to plant over 24 million trees on a 3,599 ha portion of privately owned lands in post-agricultural, degraded conditions. The project is expected to increase carbon stocks through biomass growth and soil organic carbon, generating roughly 37,500 tCO2 per year – 1.5 million tCO2 over the 40 year crediting period.

Read the Cleantech Poland article


Reduce & Retire: The Latest on Carbon Neutral

2011’s Asia-inspired runway look

Fashion trends may come and go faster than you can say H&M – but sustainability could become a classic for the the clothing retail giant. H&M has set an ambitious environmental strategy that includes a commitment to reducing emissions by at least 5 percent every year. In order to meet this goal for 2010, H&M is offsetting 67,000 tCO2e of its unavoidable emissions – an amount exceeding its annual target – through the purchase of Gold Standard CDM credits from Tricorona. The credits are sourced from a biomass power plant project in India and two wind energy projects in China.

Read more from Triconora
Read more from the Gold Standard


H2Orange you into carbon neutral school pride?

H2Orange is already pretty unique as far as bottled water companies go – not only do they sell their product in a bottle that is a scale-model replica of the University of Texas at Austin Tower (really), but also fund academic scholarships, fellowships and internships at the school. Now H2Orange is going green, announcing its continued partnership with Green Mountain Energy Company in order to offset 100 percent of its carbon emissions through 2012 by purchasing Green-e Energy certified Renewable Energy Certificates (RECs) and methane capture carbon offsets certified by the Verified Carbon Standard (VCS) and Climate Action Reserve (CAR). So far the company has offset roughly 1,220 tCO2e.

Read the press release


Not the regulatory signal they hoped for

Architects and builders behind the UK’s £2.8 million Shrewsbury Exemplar Village were dealt a harsh reminder to always read the fine print when they took a close look at last month’s Budget. Shropshire Constructing Excellence discovered a major-U turn in the national housing policy – instead of developers having to ensure a totally eco-friendly building process from 2016, the new rules would only require emissions from energy use like heating and lighting to be carbon neutral. With the legal requirements for super-eco homes scrapped, so is the project. The initiative was originally designed to develop up to 10 carbon neutral homes in an effort to see whether the government’s eco-friendly building requirements were economically viable.

Read the Shropshire Live article


Climate North America

Koch heads up the East Coast

 

New Jersey Governor Chris Christie has been accused of governing under the influence – of powerful climate opposition groups, that is. Much like New Hampshire and Maine, Christie is re-evaluating NJ’s participation in the RGGI initiative. But some observers blame pressure from GOP legislators and campaigns funded by the billionaire brothers Charles and David Koch – including the RGGI opposition groups Americans for Prosperity (AFP) and the American Legislative Executive Council (ALEC). AFP also recently backed a bill to withdraw Maine from RGGI.

 

A recently released (and hotly debated) report from American University professor Matthew Nisbet – Climate Shift: Clear Vision for the Next Decade of Public Debate – asserts that proponents of climate action are closing the gap on media spending by opposing special interest lobbies like AFP. Skeptics of the report’s findings suggest, however, that Nisbet’s estimates of environmentalists’ spending was based on the total lobbying budgets of companies that engage in some environmental lobbying – including GE and ConocoPhillips.

 

Read more from Reuters
Read more from Delawareonline
Read the Climate Shift report (.pdf)


United we stand…

… divided we reduce emissions. That’s the message that a group of states, power companies and advocacy groups are sending to the EPA about climate change regulations. The coalition has joined forces to urge the EPA to allow states to meet federal climate change rules with their own initiatives, such as the cap-and-trade programs adopted California and the 10 Northeastern RGGI states. The EPA must set new limits on GHGs from the utility sector this year, and is planning to create New Source Performance Standards (NSPS) under the Clean Air Act. “The methodology should be flexible enough to accommodate state plans that differ in manner of regulation from those described by EPA in its emissions guidelines,” the coalition said in comments to the EPA.

Read the New York Times article


The Current Market Reserve Price is right

Price discovery is the name of the game for RGGI states that are now investigating the use of a Current Market Reserve Price (CMRP) in future allowance auctions. The reserve price, or minimum bid, is the higher of the minimum reserve price (currently set at US$1.89) and the CMRP – 80 percent of the “current market” price. But what is the current market price for RGGI allowances? A consultant’s report released by RGGI on April 8 recommends that a volume weighted CMRP should be calculated using data from past auction and recent futures prices. The report is available for review and written comments by RGGI stakeholders until May 2. The next RGGI auction will take place on June 8, with participating states offering for sale 44.2 million CO2 allowances.

Read more about the CRMP
Read more from Bloomberg
Read more about the auction


“From small things, mama…”

“…Big things one day come”? That’s the hope for a regional carbon market between Western Climate Initiative (WCI) partners California and several Canadian provinces, which is set to kick off next year – albeit smaller than expected. Assuming that AB32 implementation is not impeded, California and the province of Quebec aim to start on January 1, 2012. The province of British Columbia also aims to begin in the same year, but the start date and its commitment to the program remain uncertain. Manitoba and Ontario have committed to joining at a later date. Offsets will feature prominently in the cap-and-trade system, and in this capacity BC appears to be ready for action. According to James Tansey, Executive Director of Vancouver’s ISIS research centre and founder of Offsetters, the province has a bank of carbon credits valued at more than CA$1 billion approved for sale.

Read more from Reuters
Read more from Bloomberg
Read more from the Vancouver Sun


Kyoto & Beyond

Highway to the Safe Zone

The European Commission has finally announced the end of a 3-month suspension on EU carbon registries following January’s high-profile cyber attacks. In an effort to move forward and protect against theft, Paris-based emissions exchange BlueNext SA will launch on May 3rd a new trading system that only trades units whose chain of title can be traced back to their source. According to BlueNext CEO Francois-Xavier Saint Macary, several banks and compliance buyers – including Barclays Plc, GDF Suez, Enel SpA and Orbeo – have already committed to starting the Safe Zone market. International insurance group Kiln has also launched the first insurance product designed to cover carbon credit eligibility risk – underwritten for a major international bank last week.

Read more from Bloomberg
Read more from Post Online
Read more from BusinessGreen


When in doubt, deny everything

The controversy over industrial gas credits continues in China, with officials recently rejecting claims from a confidential document indicating that chemical factories may have adjusted levels to maximize carbon credits – an action prohibited under the Clean Development Mechanism (CDM). According to the document obtained by Bloomberg, 9 out of 11 chemical plants in China that receive emission credits for cutting hydrofluorocarbon-23 (HFC-23) slowed down production after reaching their caps – an indication that they may have been ramping up production to generate credits rather than filling demand. Credits from HFC-23 destruction projects, which have produced about half of the credits in the UN emissions market since 2005, will be banned in the EU Emissions Trading Scheme (ETS) starting in May 2013.

Read the Bloomberg article


Decouple to be

New data from the European Commission shows that even though emissions increased across the EU in 2010, the ETS is doing its job of gradually decoupling carbon pollution and economic growth. The increase in emissions – up 3.3 percent in 2010 – was less than the overall industrial output and power demand. BarCap estimates that the ETS is nevertheless net long on allowances, to the tune of 440 MtCO2e allowances. Outside of the power sector, which experienced a shortage of allowances in 2010, BarCap’s Trevor Sikorski blames this oversupply for the currently bearish market activity in non-power industrial sectors.

Read more from Platts
Read more from Bloomberg


Global Policy Update

Schemes rise in East, set in West

In what seems to be a global trend, South Korea has given in to industry pressure over its planned carbon emissions trading scheme, increasing the share of free allowances to 95 percent and softening penalties for non-compliance in an effort to get parliamentary approval. The country is expected to begin emissions trading between 2013 and 2015 – and they are not alone. Taiwan is currently paving the way for an emissions trading platform, six regions in China are also expected to begin trialing emissions trading by 2013 (Beijing, Chongqing, Guangdong, Hubei, Shanghai and Tianjin), and India is looking to enforce environmental regulations in a more “market-friendly manner”, according to environment minister Jairam Ramesh. EU climate official Jos Delbeke recently praised China and other emerging nations for engaging in efforts to curb GHGs – while criticizing the US for “walking away.”

Read more from Reuters
Read more from Bloomberg
Read more from Carbon Positive


Opinions on climate controls vary to a degree

Australia is moving ahead as planned with its carbon scheme, but may not be out of the woods just yet. The government is facing mounting opposition from the public and business groups over the carbon tax and potential cost rises. A recent poll found that 59 percent of respondents opposed the plan – up 3 points from the last survey in March. Business groups have sent a series of letters to Prime Minister Julia Gillard voicing their concerns about commodity prices and competitiveness. But Treasurer Wayne Swan has defended the proposals, insisting that the government will protect vulnerable industries. “I’m not surprised by the vigor that we’ve seen in the debate at the moment,” he told Sky Television. “There’s no doubt that trade-exposed industries do deserve assistance and we’re engaged with that sector in discussions.”

Read more from Reuters
Read more from BusinessGreen


Carbon Finance

SCX sells (carbon credits)

The carbon markets wined and dined a new carbon exchange ahead of last week’s Climate Change and Wine Conference (now that’s a great pairing)! The newly-launched Santiago Climate Exchange will enlist several member companies to start – including wine giant Concha y Toro and Chilean wood pulp and forestry company Arauco – that forecast trading volumes at 5 MtCO2e by 2015. Initiated by Celfin Capital and Fundacií³n Chile, the exchange will be internationally accessible and market observers claim that the exchange will also trade international carbon credits, both voluntary and compliance. í¡lvaro Fischer, president of Fundacií³n Chile, says that the early exchange has convened “the best science… combined with the best business models, the best entrepreneurs and the willingness to lead.”

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