Climate 411

Latest Western Climate Initiative auction sells out; still space for more climate ambition from cap and trade

Yosemite National Park

Yosemite National Park

The latest California-Quebec auction was fully subscribed, based on results released today. This is the second quarter in a row where all allowances sold, which is good news for the state’s Greenhouse Gas Reduction Fund. There is still opportunity, however, for more ambition in the program moving forward.

Today’s results, by the numbers

  • All 54,773,607 current vintage allowances were offered for sale. This is the second consecutive auction where all current allowances sold. It should also be noted that there were just under 2 million more allowances offered in November compared to February, mainly due to the annual decline of the emissions cap.
  • Current vintage allowances cleared at $17.80, 9 cents above the floor price of $17.71. This is 87 cents above the November 2020 settlement price of $16.93.
  • All of the 8,306,250 future vintage allowances offered for sale sold, just as 100% sold in the previous auction. These allowances may not be used for compliance until 2024.
  • Future vintage allowances sold at $18.01, 30 cents above the floor price of $17.71, and 66 cents above the $17.35 settlement price from November 2020.
  • California raised almost $650 million for the Greenhouse Gas Reduction Fund, some of which the Legislature may allocate during the ongoing budget process for priorities such as the Community Air Protection Program and the Safe and Affordable Drinking Water Program.
  • Quebec raised just over $150 million (just over $190 million CAD) to invest in their own climate priorities.

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Also posted in Cities and states, Greenhouse Gas Emissions / Comments are closed

It’s time to unite behind next-generation clean car standards

The broad coalition defending America’s clean car standards is gaining key allies as Americans unite to build a pollution-free transportation future.

Led by Ford, automakers representing nearly half of the U.S. market have committed to working with California and the incoming Biden-Harris administration to enact ambitious policies that will create high-quality domestic jobs, protect our health, and confront the climate crisis. This is a good start, but we need all automakers to ditch the Trump administration’s clean cars rollback and advocate for next-generation standards that will make new light duty vehicles 100% pollution-free by 2035.

America’s clean car standards are among our most effective policies for reducing pollution exposure, cutting climate emissions, and creating good jobs. By driving innovation and cutting fuel costs, the model year 2017-to-2025 Clean Car Standards were projected to add hundreds of thousands of jobs and save Americans tens of billions of dollars at the gas pump each year. But the Trump administration rolled back the national standards and undermined longstanding state authority to set more protective standards. The Trump administration’s rollback would cost jobs and have devastating public health and environmental impacts, including an additional 18,500 premature deaths, 250,000 asthma attacks, and 1.5 billion tons of climate pollution — as much as running 68 coal plants for five years — by mid-century.

This is not what Americans want. A recent Pew Research Center poll showed that 71% of Americans support strengthening vehicle standards, not rolling them back.

EDF has joined a broad coalition of businesses, states, cities, experts, and environmental and public health groups in defending our clean car standards in court. We filed a lawsuit challenging the Trump administration’s attack on state authority and a second suit challenging its rollback of the national standards. (You can find all the legal briefs in the clean cars cases on our website.)  Leading transportation companies such as Lyft, Tesla, and Rivian have formed a key part of our coalition. But some automakers, including Toyota, Fiat Chrysler, GM, and Nissan, entered the litigation on the Trump administration’s side.

GM and Nissan have recently withdrawn their support of the administration’s attack on state authority, and GM has expressed its support for President-elect Biden’s vision of a zero emission transportation future. This is a welcome development, but it’s just a start. We need the entire industry to embrace ambitious policies, such as next-generation clean car standards that will create a million jobs and equitably transition the U.S. to 100% pollution-free new cars by 2035. These policies must prioritize eliminating pollution in environmental justice communities, and ensure that pollution-free vehicles and charging infrastructure are available to people of all colors and income levels.

And the automakers who are still backing Trump’s attack on state authority — looking at you, Toyota and Fiat Chrysler — need to follow their peers’ lead, for the sake of the climate, their customers, their employees, and their bottom line. Customer opinions of Toyota have dropped sharply in response to its stance on the clean car standards. This could have a big impact on sales if the company doesn’t shift out of reverse soon. Over 200 state and local officials from 26 states, and over 285,000 petitioners, have called on Toyota and Fiat Chrysler to do just that by investing in clean transport innovation, not litigation trying to prop up the Trump administration’s rollback.

If automakers need an example to follow, they should look no further than Ford, Honda, Volkswagen, BMW, and Volvo, who have been out in front supporting strong clean car standards and states’ authority to adopt them. In August, these five manufacturers entered bilateral agreements with California that recognize the state’s clean car authority and will prevent hundreds of millions of tons of climate pollution. The agreements earned the highest possible rating in EDF’s new Climate Authenticity Meter. One company that has taken its commitment a step further is Ford, which recently supported California’s bold commitment to make all new cars sold in the state zero-emitting by 2035.

As the growing support for transformative clean car standards shows, we face an incredible opportunity. Together, we can put a million Americans to work building the pollution-free cars that will make our air safer to breathe and steer us away from the climate cliff. We hope that all automakers will join us in pursuit of these shared goals.

Also posted in Cars and Pollution, Cities and states, Economics, EPA litgation, Green Jobs, Greenhouse Gas Emissions, Health, Jobs, Partners for Change, Policy / Read 1 Response

Emissions are down and cap-and-trade revenue is up, but California’s Scoping Plan must accelerate climate ambition

Downtown Los Angles at sunset. Chad Ehlers / Alamy

Downtown Los Angles at sunset. Chad Ehlers / Alamy

Recent California climate news is about the past, present, and future of climate policy. Last month the state released their 2018 emissions inventory, showing a decline in transportation emissions. Today, results of the most recent Western Climate Initiative cap-and-trade auction were released and show a rebound in demand for allowances despite the ongoing COVID-19 crisis, and an increase in revenue for the Greenhouse Gas Reduction Fund. But as the California Air Resources Board previews priorities for the Climate Change Scoping Plan updated, set to begin in early 2021, it is clear that the state needs to ramp up its emission reductions.

Let’s start with today’s auction news.

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Also posted in Carbon Markets, Cars and Pollution / Comments are closed

Western Climate Initiative auction strengthens as state has opportunity to increase its climate ambition

Caption: Solar farm in the Mojave Desert, California

Solar farm in the Mojave Desert, California

The results of the latest Western Climate Initiative cap-and-trade auction were announced today and showed stronger demand for allowances than in the May auction. This meant significantly higher revenue for California’s Greenhouse Gas Reduction Fund.

While the auction was still undersubscribed for the second quarter in a row, this is not a surprising outcome due to the ongoing COVID-19 crisis, the renewed closures in parts of California’s economy, and the overall economic uncertainty.

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Also posted in Carbon Markets / Comments are closed

Western Climate Initiative auction results show resilience of cap and trade and benefit of long-term climate investment strategy

Yosemite National Park, California. iStock.

The results of the latest joint California-Quebec cap-and-trade auction were released today. As expected, the auction was significantly undersubscribed, something not seen since February 2017. The low revenue from this auction points to a need for California to develop a diversified, long-term strategy to fund critical climate programs, even as the state works to balance many important fiscal priorities. At the same time, the resilience of the cap and trade program even during periods of instability provides a critical backstop, ensuring California’s targets for reductions in climate pollution are achieved.

Here’s a quick recap of the results:

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Also posted in Carbon Markets / Comments are closed

California’s experience with buyer liability shows how aviation can help ensure environmental integrity

https://www.flickr.com/photos/140970794@N06/30345941512

Airplane flying at sunset. Adam Clark, Flickr

The International Civil Aviation Organization is preparing to stand up its market-based emissions reduction program, the Carbon Offsetting and Reduction Scheme for International Aviation, or CORSIA. As it does so, ICAO must maintain CORSIA’s environmental integrity.

To that end, airlines should not be allowed to count, for CORSIA compliance, carbon credits that have been found to be invalid, e.g., fraudulently issued or otherwise not meeting CORSIA’s standards for credit quality. To ensure that all credits represent actual emission reductions, such substandard credits should be invalidated – even if the fraud isn’t exposed until after airlines have canceled the credits in CORSIA. The emissions for which the credits had been tendered have occurred, and still need to be covered by valid reductions in order to meet CORSIA’s promise of “carbon neutral growth.”

California offers one approach to how CORSIA can do this. In its market-based climate program, California has developed a way to cover the emissions from invalidated credits to uphold the integrity of its program and encourage emitters to invest only in high-integrity offsets. It’s known as “buyer liability,” which means that if the California Air Resources Board (CARB), the regulatory body, invalidates offset credits, then those who purchased the credits for compliance with California’s emissions limit must replace the invalidated credits. This ensures that emitters meet their full compliance obligations and that they are more diligent in selecting offsets.

Early on, California’s buyer liability approach caused some uncertainty among offset project developers. But seven years of experience demonstrates that buyer liability has worked in California’s carbon market. Here’s how we know:

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Also posted in Aviation, Carbon Markets / Comments are closed