In a world of COVID firsts, the 195 governments represented on the IPCC are meeting online to approve the Guide for Policymakers. It will be their sixth assessment report updating physical understanding of the climate system. That Guide will be released next Monday. Offline in the real world, yet further firsts in extreme climate impacts were being wrought across the planet.
In London another innovation took place. The incoming COP26 Presidency gathered Ministers in person and online to focus on key issues in Paris Agreement Article 6 negotiations. Ministers usually come together late at the COP negotiations, often too late for political compromise, so this process 100 days out from Glasgow was welcome. Discussions reportedly focused on contested issues. These included double claiming climate action; the use of pre 2020 carbon credits, and; sharing proceeds of carbon markets, particularly to assist adaptation needs in developing countries.
A slow start but a welcome early start.
Beyond these negotiations, carbon markets continue to develop internationally and here at home. As China launched its national emissions trading scheme and the European Union announced plans for a carbon border adjustment mechanism, an Australian carbon forward trade was contracted for $23.30 a tonne. It’s the first time the spot carbon price has overtaken the starting fixed price of Australia’s 2012 Emissions Trading Scheme. The timing of the deal’s delivery — February 2023 — means the price is likely being driven by the emissions trading compliance provisions under Australia’s Safeguard Mechanism. This is Australia’s unspoken secret, we do have a remnant emissions trading scheme and carbon pricing. We just need to make it part of a coherent policy framework that doesn’t risk global investment.
There are other firsts reported below and we’ll discuss many of these in Friday’s Carbon Conversation which is a Market Update on Global Developments and Local Action. All those firsts and not an Olympic reference!
Carbon Market Institute