The Australian government launched a consultation on its proposed policy framework to overhaul the Safeguard Mechanism, a scheme that covers emissions generated by the country’s biggest GHG polluters. The proposal would impose a cap on annual emissions from facilities, in aggregate, at 100 MtCO2e by 2030, compared with 137 MtCO2e in 2020-21, while setting a cumulative emissions limit of 1,233 MtCO2e for the period 2021-30, in line with the government’s target to cut GHG emissions 43% by 2030 from 2005 levels.

Prime Minister Anthony Albanese’s government also released its review into the country's carbon offset market, saying that while the Australian Carbon Credits Unit (ACCU) system was “fundamentally well-designed,” it also called for its governance structure to be broken up and for revoking one of its methodologies. Overall, the review made 16 recommendations to improve the scheme’s transparency and governance.

India’s upper house approved a bill to establish a framework for developing a carbon market in the country, mandate the use of green energy, and improve energy efficiency in buildings. The Indian government reportedly is planning for the carbon market to be fully operational by 2026 and to set up a market stabilisation fund to ensure prices don’t fall below a certain level.

Japan is set to present a bill to parliament in early 2023 that would legislate plans to launch an emissions trading scheme in 2026 and a carbon levy on fossil fuel imports two years later.

EU legislators struck a provisional deal on European Union Emissions Trading Scheme (EU ETS) bills on Dec. 18. The parties agreed to a 62% cut in ETS emissions by 2030 under 2005 levels – the midpoint between the 63% level favoured by the Parliament and the 61% sought by the Council and Commission, a major jump up from the current 43% target.

EU legislators also reached a provisional deal earlier in the month on the REPowerEU package to accelerate the bloc’s exit from Russian fossil fuels, agreeing on a €20 bln tranche of new funding financed from ETS auctions that will come from a mix of three different sources within the bloc. In a busy month for policy, Brussels also reached a provisional agreement to impose a carbon border adjustment mechanism (CBAM) on selected imported goods, though the pace of its replacement with EU ETS free allocation as a carbon leakage protection measure is yet to be determined.

EUA prices closely followed gas market movements downwards for much of December and January to move below €80/tonne to a six-week low on Jan. 6, as unseasonably mild weather and thin holiday liquidity pressured the market. Prices had reached above €90 on Dec. 20 mainly from speculative purchasing and bullish policy developments.

The Washington State Department of Ecology (ECY) will make available fewer than 10% of the state’s 2023 allowance budget at the jurisdiction’s first ever cap-and-invest sale on Feb. 28. This comes after the Washington Climate Commitment Act carbon trading programme, modelled on the linked California-Quebec market under the Western Climate Initiative, officially launched on Jan. 1.

California lawmakers should consider several changes to its cap-and-trade programme in order to meet the state’s enhanced 2030 GHG reduction target, the Legislative Analyst’s Office said in a report published on Jan. 4.

On Dec. 19, the New York Climate Action Council overwhelmingly adopted the state’s final Scoping Plan, which recommended implementation of an economy-wide cap-and-invest programme, and potentially a clean transportation standard, in order to reach the state’s GHG reduction targets.

Alberta compliance offset values climbed to new highs of C$53/tonne ($39.50) in late December as speculators boosted holdings after the provincial government set an enhanced CO2 price trajectory and increased credit usage limits under the Technology Innovation and Emissions Reduction (TIER) regime.

On Dec. 23, U.S. lawmakers passed a $1.7 trillion omnibus spending bill to fund the federal government and included establishing a programme to help rural stakeholders participate in the voluntary carbon market.

In late December, prior to leaving office, Brazilian President Jair Bolsonaro edited a provisional decree to make it easier for public forest concessions and conservation units to generate voluntary carbon credits.

The governor of Indonesia’s East Kalimantan province plans to auction emissions reduction credits reductions that have not yet been compensated for by the World Bank’s Forest Carbon Partnership Facility (FCPF) agreement with Indonesia.

The Indian Energy Exchange announced that it had established the International Carbon Exchange, a wholly owned subsidiary that will serve the nation’s emerging domestic voluntary carbon market as well as foreign carbon offset buyers.

Engie revealed that it provided the greatest proportion of carbon credits for the first MENA voluntary carbon market auction hosted by Saudi Arabia’s public investment fund (PIF) in October, selling almost 500,000 tonnes to the organisers.

Carbon removal platform Carbonfuture added its first Spanish partner VanMander to offer biochar credits from Iberia for the first time amid plans to quadruple growth this year.

Zambia and Tanzania announced that they were readying themselves for international carbon trading, developing guidelines and legislation to ramp up activity.

Brazilian President Luiz Inacio Lula da Silva reopened the country’s Amazon Fund at his Jan. 1 inauguration, prompting a release of forest protection funds from Norway and Germany while Britain suggested it could join.

The World Bank Board of Directors approved the $500 mln Brazil Climate Finance Project in collaboration with Banco do Brasil to help Brazilian companies implement credible GHG reduction practices and access “high-quality” carbon markets.

Some 96% of companies in the UK-based FTSE 350 share index increased expenditure on the voluntary carbon market over the past 24 months, of which more than 50% did so dramatically, while around half said they plan to substantially raise spending over the next 24 months, according to researchers.

ClimaFi, a tech company, meanwhile launched an exchange for trading UK woodland and peatland carbon credits in expectation of a leap in demand for the British units.

California-based tech company C+Charge plans to reward electric vehicle drivers with tokenized nature-based credits after teaming up with New York-based crypto firm Flowcarbon.

The merger of UK’s Changeblock with Canadian ESG firm Carbon12 will pave the way for a broader roll out of a blockchain-based environment credit platform for creating and trading international offsets, according to a company announcement.

Utah-based The Carbon Blockchain (TCB) acquired South African hemp producer Minerva Green for an undisclosed sum as it prepares to launch a green charcoal and biochar product later this year that will “leapfrog” traditional carbon credit generation approaches.

TCB also announced a joint venture with clean energy biomass and waste conversion firm Serengeti Energy Holdings to scale biomass cultivation throughout Africa, starting in Ghana.

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