Issue: 18 Monday, 23 July 2018
Dear ,
This summer has already seen a series of important carbon market developments. Despite the rollback of the cap-and-trade program in Ontario, many positive steps are being taken in emissions trading around the world.
As always, we are pleased to share the ICAP newsletter, a quarterly summary of the latest developments in emissions trading around the world and activities here at the International Carbon Action Partnership. For more information on cap-and-trade programs in force and in the works around the world, please visit the ICAP Interactive ETS Map on the ICAP website. It is updated regularly as new information becomes available.
Kind regards,
On 11 July, the government of the Republic of Korea released the draft allocation plan (Korean) for the second phase (2018-2020) of the Korean Emissions Trading System (KETS). According to the plan, which is expected to be approved by the end of July, 1.796 billion Korean Allowance Units (KAUs) will be issued in the 2018-2020 period, which represents a 2.1% increase compared to the first phase (2015-2017). The draft allocation plan also expands benchmark-based allocation to include the power generation, group energy, industrial complex, petrochemical, and waste sub-sectors, in addition to grey clinker, refinery and aviation. Entities in other sectors will continue to receive free allocation based on historical emission levels. On 2 May 2018, the Republic of Korea had already amended the KETS offset rules to allow for the use of international credits for compliance. From 2018, up to 50% of offset credits surrendered for compliance can stem from international projects developed by Korean companies under the Clean Development Mechanism (CDM). In total, regulated entities can currently use offset credits to meet up to 10% of their compliance obligations.Read more on the allocation plan here, benchmarking here, offsets here, and provisions for market stability here. Recent months also saw progress on Korea's 2030 climate policy roadmap (read here).
In line with his election promise, on 3 July 2018, the new Ontario Premier Douglas Ford repealed the province’s cap-and-trade program. In addition to revoking the legislation of the cap-and-trade program, regulated entities in Ontario are also prohibited from trading emissions allowances and credits. The Premier’s actions also effectively withdraw Ontario from its link with the California and Québec cap-and-trade programs under the Western Climate Initiative (WCI), even though no formal notice has been given. Following Ford’s initial announcement to repeal the cap-and-trade system, California and Québec had immediately closed their markets to trade with Ontario entities, thus preventing a major sell-off of Ontario-owned allowances into their markets.
On 25 April 2018, the first chamber of the Mexican Congress approved amendments to the General Law on Climate Change, providing the basis to establish a mandatory ETS in Mexico. The amended law directs the Mexican Ministry of Environment and Natural Resources (SEMARNAT) to design and implement an ETS in a step-wise manner and in a way that does not negatively affect the competitiveness of covered sectors, particularly those exposed to international trade.On 28 June, Mexico concluded its first carbon market simulation exercise. The simulation brought together more than 100 Mexican companies representing two thirds of Mexico’s greenhouse gas emissions from a range of sectors, such as electric power, hydrocarbons, aviation, mining, forestry, consumer goods and financial institutions. Read more on the legal basis here and the simulation here.
On 27 June 2018, the Colombian Senate announced (Spanish) its approval of a climate bill, which is now pending presidential approval. The text of the proposed draft bill (Spanish) - the text approved by the Senate has not yet been published - includes provisions for the establishment of a 'National Program of Greenhouse Gas Tradable Emission Quotas'. While there is no specific reference to carbon markets or emissions trading, such a program might allow for the establishment of a national ETS.
Read more…
CNY 69.23 (USD 10.23)**CNY 3.62 (USD 0.54)**CNY 13.00 (USD 1.92)**CNY 39.27 (USD 5.80)**CNY 17.97 (USD 2.65)**CNY 36.25 (USD 5.35)**CNY 12.50 (USD 1.85)**CNY 19.50 (USD 2.88)**
09.07.2018
Tanjiaoyi News Service (Chinese)
KRW 22,700 (USD 20.10)**
OMF CommTradeNew Zealand
Policymakers from ICAP jurisdictions will convene with the ICAP co-chairs and members of the ICAP Secretariat to plan and discuss ICAP activities. The event, kindly hosted by the New York State Government, will also feature two technical workshops on the topics of ETS linking and companion policy interactions.
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