European carbon emission allowance prices surged to a five-month high of nearly €100/tonne in the week-ended Feb. 3 amid short-covering and technical trading, before easing back to a one-week low on Feb. 6 as the recent short squeeze appeared to come to an end with milder weather conditions forecast for the weeks ahead.

EU power sector emissions rose 4% year-on-year in 2022 as weak winter demand and surging renewable output dampened the impact of much higher coal burn, according to data collated by environmental think-tank Ember.

Another report suggested that high-emitter Poland will see that coal is pushed out of its power mix by 2032 due to the falling cost of renewables and increasing carbon prices.

Washington State will make a decision this summer on whether to join the WCI-linked California-Quebec cap-and-trade market in 2025, the Department of Ecology said on Jan. 31.

New York Governor Kathy Hochul’s (D) executive budget presented Feb. 1 included language regarding a rebate fund for the state’s forthcoming economy-wide cap-and-invest programme, with officials saying the scheme could begin hosting carbon auctions in 2025 at the earliest.

The New York carbon market has the potential to link with other states, experts told Carbon Pulse, though it remains unclear if it would be with California, Washington, or through a resurrection of the regional fuel sector Transportation and Climate Initiative Program (TCI-P).

The California Independent Emissions Market Advisory (IEMAC) asked lawmakers and policymakers on Feb. 3 to clarify their legal authority on operating the state’s WCI-linked cap-and-trade system beyond 2030, as the programme’s extension is fundamental to reaching California’s climate goals.

Analysis firm Energy Aspects lowered its California Carbon Allowance (CCA) average price forecast to $31 in 2023 from $33 due to a slowdown in economic activity hurting industrial output, making it the second time the company has lowered its outlook for this year by $2.

Entities registered under the California Low Carbon Fuel Standard (LCFS) generated a quarterly record of 1.73 mln net credits in Q3 2022, government data showed on Jan. 31, as higher renewable diesel, electricity, and renewable natural gas contrasted with declining diesel and gasoline volumes. LCFS prices for prompt delivery in the physical market held near $60/tonne in the wake of the data release, approaching 5.5-year lows.

RGGI-regulated power generators’ CO2 output reached 109.5 mln short tons in 2022, according to CO2 Allowance Tracking System (COATS) data. This marked a 2.6% increase over 2021 levels, and comes far above the 11-state programme’s adjusted cap of 97 Mt.

China is considering the opportunity to let coal-fired power plants covered by the national ETS borrow permits from future years to ease the scheme’s short-term cost impacts.

South Korea has moved up the deadline by a year for finalising the fourth basic plan for the national ETS to faster align the programme with its increased ambition under the Paris Agreement, with the plan to be finalised in Dec. 2023, as opposed to Dec. 2024 as previously planned.

Taiwan has passed a revised climate bill that includes the legislation of the island’s 2050 net zero targets and the introduction of a carbon levy scheme, which is set to be launched in 2024 at the earliest.

Nearly 100 coal plants in Indonesia will begin participating in Indonesia’s newly introduced carbon trading scheme, marking the first of three phases for the sector to cut its emissions to meet the country’s NDC targets, beginning with units with over 100 MW capacity.

In Australia, a government official laid out steps the government would take to implement the recommendations of a recent review of the country’s carbon market, although it would take time to see the changes fully realised.

The 2023 slump in standardised nature-based offset prices in the voluntary carbon market (VCM) continued following claims in the media of widespread over-crediting in the REDD+ avoided deforestation sector. CBL’s nature-based standard spot contract, the N-GEO, tumbled to just $1.95 at the end of last week, down $0.66 from a week earlier. However, signs have emerged that sought-after over-the-counter (OTC) credits may have found a floor.

Carbon credit developer and intermediary South Pole said it would not immediately sell recent-vintage offsets from a major African REDD+ project as the firm reassesses the initiative’s emissions baseline, while ratings agency BeZero Carbon placed this Kariba REDD+ project on watch for a potential score change in light of the media reports of widespread over-crediting.

Carbon standard developer and manager Verra also halted the use of a popular UN methodology for generating offsets from growing rice, launching a review of the protocol after integrity concerns were raised.

Cookstoves were the most common new project in the voluntary carbon market last year, although REDD+ avoided deforestation projects still issued the most credits, according to a database compiling registry data.

Data aggregator AlliedOffsets published what it claims is the world’s first rating of corporate activity in the VCM, assigning a score to over 300 firms that have retired credits based on their share of emissions offset and the profile of units purchased.

Japan has extended J-Credit eligibility for local companies to offset their emissions from activities abroad. The country has also agreed to co-fund the development of a second third-country project under the Joint Crediting Mechanism, which aims to utilise green hydrogen produced in New Zealand.

China has a lot of work to do to facilitate the international trade in Chinese carbon credits, despite emissions reductions generated from the country’s national CCER offset programme having been deemed eligible in CORSIA’s pilot phase (2021-23), according to analysts.

South Korea has signed its first government contract to buy CDM carbon credits from a landfill gas project in Uzbekistan, while the country's SK Group has agreed to form a partnership with Mubadala Investment, a sovereign wealth fund of the UAE, to explore VCM potential.

Singapore and Malaysia signed a green economy bilateral agreement that includes closer cooperation on carbon markets, as well as low carbon solutions, renewables, ESG capacity, and technical standards for next generation mobility.

Indonesia pledged to step up its efforts to develop its blue carbon potential, while an Indonesian project developer secured a land agreement to convert land to a REDD+ project that could generate 3.7 mln VCUs annually.

Alaska Governor Mike Dunleavy (R) introduced a bill aimed at helping manage the state’s participation in generating voluntary forest carbon credits, as well as carbon capture, utilisation, and storage projects.

India committed over $4 bln on energy transition spending in its annual budget, which also included the setting up a Green Credit scheme to incentivise changes in behaviour of companies, individuals, and local agencies to help meet the country’s climate targets. The scheme will act in addition to existing carbon market schemes, and cover forest and ecosystem, air and water, and waste management credits.

Increased EU state aid will be used as a “bridge” to help fund the bloc’s decarbonisation efforts up to 2025 until a sovereignty fund is established, the European Commission has said, setting out a green industrial plan to help the region compete with the U.S. and China in clean manufacturing.

A U.S.-based green steel firm secured $120 mln of Series C fundraising led by EU-based multinational steelmaker ArcelorMittal with tech giant Microsoft also involved.

Events in 2022 have driven BP to substantially reduce its annual outlook for emissions out to 2050, with the oil major forecasting that emissions could peak earlier in the 2020s than it had previously suggested.

Ryanair became the latest low-cost EU airline, after EasyJet and Wizz Air, to point to resurgent demand in its quarterly report, stating expectations of “very robust” passenger numbers in the summer after a company record in the final quarter of 2022.

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