Environmental Markets Correspondent/Communities Editor
Michael's Feed
Jun 14, 2010

Firms abusing Kyoto carbon trading scheme: watchdog

LONDON (Reuters) – Firms participating in a Kyoto Protocol carbon scheme are abusing it by artificially inflating their greenhouse gas emissions, thereby allowing rich nations’ emissions to rise significantly, a watchdog said on Saturday.

Under Kyoto’s Clean Development Mechanism (CDM), worth $2.7 billion in 2009, companies can invest in carbon-cutting projects in emerging economies, and in return get carbon offsets that can be used against their own emissions.

Jun 9, 2010

China fossil fuel CO2 jumps as global total falls

LONDON (Reuters) – China could face increasing pressure in U.N. climate talks after data released on Wednesday showed the country’s carbon dioxide emissions from fossil fuel rose by 9 percent in 2009, bucking a global downtrend.

China’s greenhouse gases from fuels like oil and coal grew to 7.5 billion tonnes, even though global emissions fell for the first time since 1998 as industrial output and fuel consumption dropped amid a global recession, BP data showed.

Jun 2, 2010

Barclays to buy Swedish carbon trader Tricorona

LONDON (Reuters) – Barclays Plc agreed a 98 million pound ($142.4 million) cash offer for Swedish carbon credits trader Tricorona AB, giving a vote of confidence in the carbon market ahead of the expiry of the Kyoto climate pact.

Barclays said on Wednesday it was offering 8 Swedish crowns ($1.01) a share for Stockholm-based Tricorona, which specializes in sourcing, developing and trading offsets from greenhouse gas reduction projects in developing countries.

Jun 1, 2010

Carbon market players say open to self-policing

LONDON (Reuters) – Carbon market players said on Tuesday they will consider developing self-policing rules after a call to action by the UN’s new climate chief, but warned that more political will is needed by governments to spur investment.

Christiana Figueres, who officially starts her new role in July, on Friday said market participants had “seriously impaired the trust of governments, civil society and non-profits,” through several scandals that rocked the largely unregulated $144 billion market last year.

May 28, 2010

Frustrated EU carbon traders play waiting game

COLOGNE, Germany (Reuters) – Major changes proposed to the European Union’s emissions market could dramatically alter the landscape for traders, who are increasingly frustrated by regulatory uncertainty and political stalemate.

A deeper 2020 EU greenhouse gas reduction commitment, qualitative and quantitative restrictions on carbon offset eligibility and details on carbon permit auctioning in the scheme’s third phase are among the decisions expected to be made this year by the 27-nation bloc’s executive.

May 28, 2010

Japan says Kyoto support, CO2 targets in the balance

COLOGNE (Reuters) – Japan may withdraw support for the Kyoto Protocol post-2012, demanding major emitters the United States, China and India sign up to a unified plan to cut greenhouse gases, a prime ministerial climate advisor said.

“We are seeking the inclusion of China, India and the United States into a united system for global (greenhouse gas) abatement,” Mutsuyoshi Nishimura, former chief climate negotiator for Japan, told Reuters in an interview on Friday.

May 26, 2010

Govts urged to focus on climate funds risk, returns

COLOGNE, May 26 (Reuters) – Governments should focus more on generating returns and reducing risk for investors to attract the $100 billion in aid needed by developing countries to cope with climate change, a panel of experts said on Wednesday.

Rich countries are being urged to adhere to key elements of a climate accord signed in Copenhagen last year, including a promise of $10 billion a year in quick-start aid from 2010-12 for poor countries, rising to $100 billion a year from 2020.

"$100 billion sounds like a lot of money … (but) raising large amounts of money in the private sector is actually very easy," said Martin Lawless, head of environmental financial products at Deutsche Bank.

"Too much attention is focussed on who will provide the money. Instead it should be on the other side, how to increase returns and reduce risks. Once that is established, the finance will follow."

The United Nations urged rich nations on Tuesday to keep their pledge to give $30 billion to poor nations by 2012, saying it was "not an impossible call" despite budget cuts in Europe. [ID:nLDE64O1P4]

But with worries over sovereign debt also growing, the private sector may be asked to help fill more of the funding gap.

"When you have the right proposition, the financing will come," said Mohsen Khalil, global head of the International Financial Corporation’s new Climate Business Solutions Group.

"We’re at a transition phase where the public and private sectors have to align their interests because heavy subsidies will be required initially until costs come down and we can have a large-scale sustainable business."

The panel agreed that the role of carbon markets in directing funds to financing clean energy and climate change adaptation in developing countries was shrinking.

Another panel of analysts said earlier on Wednesday that market mechanisms will survive beyond 2012, but their exact shape remains unclear as international climate talks now bypass their role in favour of the wider policy picture. [ID:nLDE64P1AQ]

"Carbon credits were good for a time, but is it the only instrument (to engage the private sector)? I don’t think so," said Khalil.

"Against the background of recent economic turmoil, investors are particularly risk averse, so the private sector needs TLC: transparency, longevity and consistency," Lawless said.

He cited a unilateral carbon price floor set by China in 2007 and growing uncertainty over the $144 billion global carbon market’s future post-2012, when the first five-year leg of the Kyoto Protocol expires, as deterrents to investors.

Key ministers and climate negotiators from China to Norway have said governments are unlikely to agree a successor to Kyoto at UN talks in Cancun, Mexico later this year. [ID:nTOE64O059]

"It will never be possible to motivate substantial private sector finance if the market faces the same uncertainties every 5-10 years. Incentive mechanisms need to be assumed to be permanent," he added. (Editing by Amanda Cooper)

May 26, 2010

Ontario a sleeping clean energy giant: Trillium CEO

LONDON (Reuters) – Ontario, Canada’s most populous province, is a dormant renewable energy giant lacking the investment and government support needed to awaken it, the head of a Canadian wind power developer told Reuters.

Trillium Wind Power is developing four offshore wind farms in Canada’s Great Lakes, including the 142-turbine Wind 1 project 17-28 kilometers into Lake Ontario, which the company’s CEO said will generate up to 500 megawatts of electricity by 2014, or enough to power over 200,000 homes.

May 26, 2010

Ontario a sleeping clean energy giant, says wind CEO

LONDON, May 26 (Reuters) – Ontario, Canada’s most populous province, is a dormant renewable energy giant lacking the investment and government support needed to awaken it, the head of a Canadian wind power developer told Reuters. Trillium Wind Power is developing four offshore wind farms in Canada’s Great Lakes, including the 142-turbine Wind 1 project 17-28 kilometres into Lake Ontario, which the company’s CEO said will generate up to 500 megawatts of electricity by 2014, or enough to power over 200,000 homes.

Trillium’s four projects, once completed, are collectively expected to generate up to 3,700 megawatts.

"People don’t even realize there’s this kind of capacity in the Great Lakes … It’s completely unknown," Trillium’s John Kourtoff said in a telephone interview.

"Because of the amount of resources available and its geography, able to export power to nearly half the continental U.S., Ontario is an awakening giant for renewable energy in North America for the twenty-first century."

"We have a tremendous amount of offshore wind, but we haven’t harnessed any of it," he said, comparing it to Niagara Falls hydro power’s role in industrialising Ontario last century.

Wind 1, which Kourtoff expects will get government approval by Q1 2011 and begin construction by late 2012, could create over 2,000 jobs and displace Ontario’s greenhouse gas emissions by 1.8 million tonnes annually.

Kourtoff said the Great Lakes, four of five of which border Ontario and are among the biggest in the world, are ideal for offshore wind due to their consistent wind speeds and the lack of tides and strong waves.

"Lake Ontario’s average waves are less than a metre high and its wind is consistent at around 9 metres per second," he said.

"It’s essentially a windy, fresh water bathtub."

Kourtoff said wind turbines in the Great Lakes can also help regenerate aquatic life up to 8 times faster than normal.


Though Ontario may have great green energy potential, Kourtoff said the investment climate remains difficult. "That’s the main challenge here and it’s a bit of a sore point," he said, referring to early stage financing.

"Canadian banks have been extremely slow getting into renewables, giving the opportunity to foreign firms. The approaches we’ve had so far have been from European and Middle Eastern firms and American private equity players."

Last year the province introduced a new feed-in tariff in an effort to spur growth in renewable energy. The tariff is guaranteed for 20 years and sets offshore wind generation rates at C$0.19 ($0.177) per kilowatt hour for approved suppliers.

Kourtoff also pointed to offshore wind permitting in Ontario, guaranteed to take under 6 months compared to an average wait of 42 months in Europe.

"We’ve got no venture capital and no support from the federal government in the form of subsidies … though they’re happy to hand out billions for carbon capture and storage (CCS) for Alberta’s oil sands," he said.

The Canadian federal government has allocated around C$1.4 billion to go along with $2 billion in CCS funding from the Alberta government. These pilot projects will see only a total of some 4-5 million tonnes of carbon dioxide buried underground.

In February Trillium picked Danish wind turbine maker Vestas <VWS.CO> to supply the turbines for Wind 1. [ID:nLDE6181TI]

Kourtoff would not comment on rumours that Vestas will build a turbine plant in Ontario, but said Hamilton, the province’s steel manufacturing centre, would make an obvious choice.

"Ontario’s Great Lakes are the low-hanging fruit … and firms that come early will get the lion’s share," he added. ($1=1.072 Canadian Dollar) (Editing by James Jukwey)

May 26, 2010

Global CO2 market up in 2009 as finance falls

COLOGNE, Germany (Reuters) – The global carbon market grew 6 percent to $144 billion last year, from $135 billion in 2008, as a rise in speculative trading offset a drop in carbon finance for developing nations, the World Bank said on Wednesday.

Greenhouse gas emissions cuts in developing nations funded by rich countries under the Kyoto Protocol fell by half to 211 million tonnes of carbon dioxide (CO2) in 2009, down from 404 million in 2008, the bank said in a report.

    • About Michael

      "Michael Szabo is an environmental markets correspondent based in London, UK. His focus is on carbon emissions trading, but also looks at renewable energy and climate change policy and science. He also manages the Global Carbon Forum."
      Joined Reuters:
      June 2005
      English, French
    • More from Michael

    • Follow Michael