Carbon Pulse

Recent allegations of widespread over-crediting in the voluntary carbon market (VCM) have raised questions of whether the dominant revenue model of offset standards bodies financially incentivises those involved to maximise issuance while compromising integrity.

Commodity trading house Mercuria unveiled plans on Monday to invest $500 million in a new nature-based business to fund carbon and biodiversity projects.

EU member states have made modest progress in issuing EU emissions allowances for 2023 in the past fortnight, though a quarter of the bloc has still not started handing out permits, according to an update from the European Commission.

EUAs resumed their downtrend on Monday morning amid widespread weakness in energy and financial markets after the Swiss government engineered the takeover of stricken Credit Suisse by UBS, as compliance demand continued to pick up but not sufficiently to outweigh speculative selling.

An Australian start-up has sold its first batch of Kelp Reforestation Credits to a commercial fishing company and has begun the process of developing a carbon credit methodology for kelp reforestation under two well-established carbon offset standards.

Fissures have emerged between G7 member states over the approach towards climate policy in the run-up to the group’s meeting of energy, climate, and environment ministers to be held in Sapporo, Japan next month.

The government of South Korea has been sued for backtracking on 2030 renewable energy commitments in its latest electricity plan, which has prompted concerns over the progress towards the country’s carbon neutrality goals.

Australian independent MPs have proposed a raft of amendments to the Safeguard Mechanism legislation currently before parliament before it goes to the Senate, where it is still unclear if the government has the support it needs to pass it.

A daily summary of our news plus bite-sized updates from around the world.

A group of Paraguay senators has put forth legislation that would set up a national carbon offset registry and help track the transfer of credits abroad, with the country required to hold back a portion of these units to meet its own Paris Agreement target.

Financial players boosted their net long California Carbon Allowance (CCA) holdings but shed RGGI Allowances (RGA) over a two-week stretch into early March, while compliance entities offloaded permits across North American carbon markets, data from the US Commodity Futures Trading Commission (CFTC) showed this week as the agency continued publishing backlogged Commitments of Traders (COT) reports.

Clean fuel producers and one high-profile electric car manufacturer this week expressed their support for more stringent GHG reduction targets in an upcoming California Low Carbon Fuel Standard (LCFS) rulemaking, but industry groups opposed a proposed phase-out of avoided methane crediting, according to public comments.

California and Quebec will offer slightly fewer carbon allowances at the May auction compared to the first 2023 sale last month, according to a government notice published Friday.

A summary of legislative, regulatory, and policy action on carbon, clean fuel standard, and clean energy markets at the US federal and subnational levels this week, including a sponsorship memorandum for a Republican-led Pennsylvania low-carbon fuel standard (LCFS).

The Nova Scotia government has approved several changes to its outgoing cap-and-trade programme to provide emitters with compliance pathways, including giving millions of free permits to the Canadian province’s utility and letting entities purchase more allowances than usual, according to a government order seen by Carbon Pulse.

EU legislation for a certification scheme for voluntary carbon removals should also give clarity on whether removals should be included in the EU ETS, a handful of the bloc's environment ministers said this week. 

A new carbon project developer has raised $2 million in seed funding from trading and supply chain logistics company Kemexon, and opened offices in Mexico City and Geneva.

European carbon prices rose for the first time in a week on Friday, peaking after the daily auction cleared at the smallest discount in nearly two weeks amid the strongest participation in four months, even as traders described a market taking a rest after some of the most volatile trading in months.

The body responsible for determining which project types will be issued with UN-backed emissions credits under Article 6 of the Paris Agreement opened a call for inputs on Thursday, seeking outside help after struggling to reach consensus on topics such as permanence, additionality, and overall ambition.

Safeguard Mechanism entities needing Australian Carbon Credit Units (ACCUs) to comply with the scheme may face insufficient supply as issuance growth is slowing down while demand is accelerating, the Clean Energy Regulator (CER) said on Friday.