Climate 411

Nature is more important than ever to realizing climate goals at COP28

Aerial view: Corcovado National Park, Costa Rica

Natural climate solutions include conserving tropical forest and ocean ecosystems. Photo: Eisenlohr, iStock

This blog was co-authored by Britta Johnston, Senior Policy Analyst for Natural Climate Solutions at EDF.

Heading into COP28, nature as a climate solution has been making headlines, and rightfully so. Sustainably conserving, restoring, and managing the world’s ecosystems is one of the most powerful tools we have to meet global climate goals.

A recent study finds that restoring global forests where they occur naturally could potentially capture 226 gigatons of carbon, and 61 percent of the carbon storage could come from protecting existing forests.

We are beginning to realize the promise of protecting forests. Another report finds that deforestation in the Brazilian Amazon has dropped by 22.3 percent as a result of active intervention to curb forest loss – the lowest it has been since 2018.

Moreover, advancements in policies and practices to build resilience in boreal and temperate forest ecosystems, along with strategies for mitigating catastrophic wildfire, can ensure these ecosystems remain net greenhouse gas sinks.

Oceans also have climate mitigation potential. New evidence suggests that organisms in the mesopelagic zone, a region of ocean between 200 and 1,000 meters deep containing 95 percent of ocean biomass, may trap millions of tons of carbon each year by feeding in surface waters at night and diving back down in the day.

We have better science than ever before about nature’s role as a climate solution, and signs of progress on very important fronts. That’s why nature must be at the heart of conversation and action at COP28, both inside and outside the negotiation rooms.

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Posted in Carbon Markets, Forest protection, Indigenous People, International, Paris Agreement, REDD+, United Nations / Leave a comment

The latest on climate change in the U.S. – from the Fifth National Climate Assessment

A wildfire in California, 2021

The U.S. government recently released the Fifth National Climate Assessment, a comprehensive report that shows the harmful impacts of extreme weather and other climate hazards are increasing for people across the United States.

The Fifth National Climate Assessment confirms messages in previous reports but brings the details into sharper focus for U.S. regions.

Climate change is increasingly expensive. The direct cost of exacerbated disasters costs the country a whopping $150 billion a year. But there are additional costs as well, including missed workdays from wildfires and heat when the air is so unhealthy that it is too dangerous to work outside.

Scientists can now confidently attribute worsening extreme weather in the U.S. to climate change, including heatwaves, droughts, heavy downpours like those that caused dangerous flooding in New York City in September, and  the deadly wildfires in Hawaii and the West.

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Posted in Basic Science of Global Warming, Extreme Weather, Greenhouse Gas Emissions, Health, News, Science / Leave a comment

Article 6 moves to implementation, at COP28 and beyond

This blog was authored by Pedro Martins Barata, AVP for Carbon Markets and Private Sector Decarbonization at the Environmental Defense Fund.

Since the Glasgow COP two years ago, there have been growing expectations to transform the market-based cooperation approaches outlined in Article 6 of the Paris Agreement into practical, effective actions for reducing global emissions. Article 6 is not just another clause in an international treaty; it serves as a practical framework for cooperative climate action that has the potential to unlock higher ambition for reducing carbon emissions and adaptation actions. As COP28 unfolds, it is set to complete the development stage of these mechanisms, paving the way for tangible, impactful action in the near future. 

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Posted in Carbon Markets, Forest protection / Comments are closed

The Regional Greenhouse Gas Initiative is at a critical juncture. Here are 3 ways it can put states on the path to meet our climate goals

Since the Regional Greenhouse Gas Initiative (RGGI) began well over a decade ago, this group of Eastern states has successfully slashed climate pollution from power plants in half, generated substantial health benefits and raised $3 billion in proceeds that have been invested back into states.

Now this program, which puts a declining cap on power sector pollution, is at a crucial juncture that will determine its impact this decade.

Since February of 2021, RGGI Inc, the organization that oversees RGGI has been conducting its third program review — a process meant to assess RGGI’s successes, impacts and potential design changes. Given the opportunities offered by major investments in the Inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL), along with the fast-approaching 2030 deadline for the U.S. to reduce emissions by at least 50%, the stakes for the current program review are high.

EDF submitted public comment on the review, urging RGGI Inc to take several key steps as it plans the trajectory of RGGI through 2030 and beyond. First, RGGI Inc should align the program’s emissions cap with national and state climate commitments. Second, RGGI should include an interim target of at least 80% emissions reductions by 2030 to ensure that states take near-term action that lines up with where the power sector needs to be to achieve climate targets. Third, RGGI Inc should create a pathway to cover imported electricity as a means to mitigate emissions leakage (a situation where emissions from non-RGGI states may increase).

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Posted in Carbon Markets, Cities and states, Greenhouse Gas Emissions / Comments are closed

As Washington state considers linking carbon market with California-Quebec, this cost-containment tool ensures that its program continues to run smoothly

Fall foliage over a Washington lake

Today, the Washington State Department of Ecology (Ecology) released the results from Washington’s second Allowance Price Containment Reserve (APCR) auction, held on November 8th. At this auction, all 5 million available APCR allowances were sold at the Tier 1 price of $51.90. This auction, along with three previous sold-out cap-and-invest auctions, continues to show strong demand for allowances in Washington’s cap-and-invest program and illustrates the important role of the APCR in providing predictability and stability in allowance prices.

APCRs: A Recap

An APCR is a price containment mechanism that was designed into Washington’s cap-and-invest program as a way to keep allowance prices stable and predictable. It functions similar to a soft price ceiling by ensuring that, if a certain price is reached in a quarterly auction, a separate number of allowances set aside for this purpose become available at a separate APCR auction. Importantly, these allowances are set aside ahead of time and are still part of the overall allowance budget set by Ecology to keep Washington on track to meet its climate targets. By making these allowances available at a transparent and predetermined point, an APCR auction helps to stabilize prices in the market overall.

Want more information about how Washington’s APCR works? Check out our blog from earlier this summer explaining this key program feature.

APCR auction results

At last week’s auction, participating entities submitted bids for APCR allowances at the Tier 1 price of $51.90. All allowances were offered at the Tier 1 price, with none available at the Tier 2 price of $66.68.

Here are the results, released today:

  • Tier Price 1: 5,000,000 allowances sold at a price of $51.90 per allowance.

In this auction, Ecology offered all APCR allowances at the Tier 1 price, rather than dividing them between Tier 1 and Tier 2 prices. There were also more allowances available at this APCR auction than at August’s APCR auction, with 5 million made available this month compared with just over 1 million in August. Ecology determined that this is an important strategy for increasing market stability by putting downward pressure on compliance costs early in the program, while many covered entities are still developing their strategies for compliance and decarbonization.

What these results mean

This was Washington’s second APCR auction and its implementation shows just how important this feature is as a price-stabilizer. In the first year of this program, covered entities are still in the early stages of figuring out and implementing their plans to reduce their emissions. As these early auctions play out, businesses are inclined to out-bid each other for allowances sooner rather than later — with the expectation that allowances will get more expensive over time. This drives strong demand in these early auctions, illustrating the utility of a cost containment mechanism like the APCR. As covered entities reduce their emissions, they’ll need fewer allowances to cover their pollution — which will lower demand and keep prices low in turn.

An APCR might not be triggered at every quarterly auction, but it was designed into the program from the beginning to keep it functioning smoothly. In doing so, Ecology created a more stable and durable program while utilizing allowances that are still part of the planned allowance budget.

Cutting costs through linkage

Earlier this month, Ecology announced its decision to pursue market linkage with the joint California-Quebec carbon market. This is great news for long-term cost containment and stabilization for Washington and, if also pursued by California and Quebec, could bring about significant advantages for all participating markets. A broader, linked market could drive deeper and faster cuts in climate pollution, lower the cost of compliance for Washington companies and support a more stable, predictable market overall. Ecology’s decision is the start of a process in Washington and we’ll be watching for further developments in the Evergreen State as well as in California and Quebec.

Posted in California, Carbon Markets, Cities and states, Economics, Energy, Greenhouse Gas Emissions, Policy / Comments are closed

A decade in, California’s cap-and-trade has slashed climate pollution and generated investments — where does it go from here?

Sunset on the Mohave Desert

This year, California marked the 10th anniversary of its landmark cap-and-trade program, and the Golden State has good reason to celebrate: California saw reduced year-on-year emissions from nearly every sector covered by the program. On top of delivering on critical emissions reductions, cap-and-trade has generated revenue resulting in $9.3 billion implemented through California Climate Investments programs that contribute to emission reductions, support climate equity and improve public health outcomes. And yet, there’s still much more work to be done to ensure that this program delivers reductions at the scale and speed required to avert the worst impacts of climate change while meaningfully supporting overburdened communities.

With a rulemaking in progress to make further necessary improvements to cap-and-trade, here’s what you need to know about what’s coming up through the end of the year and what to pay attention to in the new year.

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Posted in California, Carbon Markets, Cities and states, Energy, Greenhouse Gas Emissions, Policy / Comments are closed