China ETS: Emissions prices, volumes hit new record low

Market: Emissions
03/09/21

Trading volumes and prices in China's national emissions trading scheme (ETS) have fallen to new lows, with just 658t of CO2 equivalent (CO2e) traded this week.

The average price fell by 6.6pc from a week earlier to 44.7 yuan/t ($6.93/t) in the week of 30 August to 3 September, with prices ending at Yn44.67/t today, down by 0.9pc from a week earlier. Prices settled at Yn44.66/t yesterday, the lowest since the ETS began operations in July.

No bulk agreements traded this week, compared with 455,000t a week earlier. Total open bid trading volume last week was 44,527t.

The power installations that are covered by the national ETS are allocated their emissions allowances using an output-based benchmark, while emitters receive ample, free allowances, keeping transaction volumes low.

The benchmark needs to be gradually tightened as power installations upgrade to higher efficiencies and lower emissions intensity, to avoid the risk of over-allocation, Tsinghua University professor Zhang Da said this week.

It is essential to create a solid price signal that will help push forward the decarbonisation of the coal-based power sector, Zhang said. He also called for the inclusion of an auction and an emissions cap in the ETS to increase market liquidity, as well as an incentive mechanism to phase out fossil fuels.

Weekly policy review

China's top working group for peak emissions, headed by vice-premier Han Zheng, has set up a team to focus on emissions accounting work and co-ordinate between provinces and industrial sectors. The accounting team will be led by major economic planning agency the NDRC, the environment and ecology ministry and the national statistics bureau, while industrial associations in the coal, steel, petrochemical, non-ferrous metal and electricity sectors will also be involved.

Hainan province will establish a carbon emissions trading centre to connect China's national ETS with the international market, according to a government filing on 1 September. The initiative has been included in a plan to open up Hainan's financial sector as part of its transformation into a free-trade zone.

Also this week, energy planner the NEA pledged to strengthen its oversight of the energy and environmental sector in response to government criticisms of its work. It set out a "rectification plan", including pledges to accelerate development of non-thermal energy sources and reduce coal's share of total energy consumption. A detailed plan for peak emissions from the energy sector is due by the end of this year.

China ETS volumes, prices

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19/03/25

UK study sets out Grangemouth's post-refining future

Edinburgh, 19 March (Argus) — A government-funded study has identified nine potential low-carbon and renewable options for the Grangemouth site in Scotland following the planned closure of its 150,000 b/d refinery in the second quarter this year. The nine possible projects outlined in the Project Willow study centre around waste, bio-feedstocks and industries supporting the development of offshore wind. They could benefit each other through synergies and create up to 800 direct jobs, but their success "will require significant contributions from both the public and private sector", with an initial £3.5bn ($4.5bn) in capital investments needed, the study said. The £1.5mn report, paid for by the UK and Scottish governments, was commissioned by Grangemouth refinery operator Petroineos, which announced in November 2023 that it was going to close the plant and convert it into a fuel import terminal. The UK and Scottish governments have since set aside £25mn and £200mn for Grangemouth, along with other initiatives such as Scotland's £100mn Falkirk and Grangemouth Growth Deal package. The study's 'waste' pathway comprises a hydrothermal plastic recycling project, a dissolution plastic recycling facility and a bio-refining project relying on bacterial fermentation (ABE). Under the 'bio-feedstock' pathway, the study envisages a second-generation bioethanol plant on Scottish timber feedstock and an anaerobic digestion facility using organic waste to produce biomethane. Second-generation bioethanol refers to ethanol made from non-edible resources such as biomass. This pathway also suggests a sustainable aviation fuel (SAF) plant, with production made from hydroprocessed esters and fatty acids (HEFA). UK trade union Unite has been supportive of this option , but Petroineos deemed it unviable "under current regulatory conditions". The third pathway — called conduit for offshore wind — is mostly focused on hydrogen. It includes fuel switching, producing jet from e-methanol and methanol as well as producing low-carbon ammonia for the shipping and chemicals industry. The second-generation ethanol plant and the HEFA facility, as well as the e-methanol and e-ammonia projects, would have a longer 2030-40 timeline, against a 2028-30 timeline for the other projects. The projects would benefit from existing infrastructure such as Grangemouth's port, which includes container, bulk and liquid fuel terminals. "There are also opportunities to reuse existing tank storage, ethanol facilities, and other ancillary assets at the site," the study said. Unite has criticised the study's project timelines, pointing out most would start years after the refinery had closed, by which time jobs would have been lost. Many of the projects "could be fast tracked and implemented now", including converting the refinery to SAF production, the union said. "Project Willow was created by Petroineos as a fig leaf to justify its act of industrial vandalism of shutting the refinery and axing jobs. It asked the wrong questions and then failed to provide the answers that Grangemouth refinery workers need," Unite general secretary Sharon Graham said. "There are projects like SAF production which can be swiftly enacted to protect jobs and those opportunities must not be lost. This would pave the way for the UK to become a world leader in green aviation." By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Global temp 1.34-1.41°C above pre-industrial era: WMO

19/03/25

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19/03/25

Global temp 1.34-1.41°C above pre-industrial era: WMO

London, 19 March (Argus) — Global temperatures are at around 1.34°C-1.41°C above pre-industrial levels, although 2024 was likely to have breached 1.5°C, the World Meteorological Organisation (WMO) said today in its State of the Global Climate 2024 report. The long-term 1.34°C-1.41°C range is the best estimate currently possible, but "given the uncertainty ranges, the possibility that we have already exceeded 1.5°C cannot be ruled out", the WMO said. The Paris climate agreement seeks to limit the rise in global temperatures to "well below" 2°C above pre-industrial levels, and preferably to 1.5°C. But last year was the hottest on record , at 1.55°C above the pre-industrial average, with a margin of uncertainty of 0.13°C either above or below that figure, the WMO said in January. The organisation uses datasets from six weather and science agencies. Individual years that exceed the 1.5°C level do not mean that the Paris agreement goals are out of reach, as the temperature limits sought by the accord work on a timeframe of at least 20 years. But "it is a wake-up call that we are increasing the risks to our lives, economies and to the planet", WMO secretary general Celeste Saulo said. The record-high temperatures in 2023 and 2024 were owed to "the ongoing rise in greenhouse gas emissions" (GHGs) as well as "a shift from a cooling La Nina to warming El Nino event", the WMO found. Other contributing factors may include solar cycle changes, volcanic eruptions and a decline in cooling aerosols, it added. The atmospheric concentration of CO2 in 2023 was higher "than at any time in at least 2 million years", the WMO found. Concentrations of other key GHGs methane and nitrous oxide in 2023 reached their highest in the last 800,000 years, while data show that levels of those GHGs continued to increase in 2024, it added. The concentration of CO2 in 2023 was at 420 parts per million (ppm) — 2.3ppm more than in 2022 — and at 151pc of the pre-industrial concentration. CO2 levels correspond to 3.276 trillion t in the atmosphere, the WMO said. Concentrations of methane and nitrous oxide in 2023 stood at 265pc and 125pc of pre-industrial levels, respectively. The majority of surplus heat goes into warming the ocean, which — along with ice loss on land — causes sea levels to rise. The "rate of sea level rise has doubled since satellite measurements began", from 2.1mm/yr between 1993 and 2002, to 4.7mm/yr between 2015-2024, the WMO said. The organisation also flagged the number of extreme weather events in 2024, citing wildfires, hurricanes, floods, droughts and more, which led to the "highest number of new displacements recorded for the past 16 years, contributed to worsening food crises, and caused massive economic losses". By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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German climate fund draws interest from Africa

18/03/25

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18/03/25

German climate fund draws interest from Africa

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Australian carbon credit supply rises in February

18/03/25

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18/03/25

Australian carbon credit supply rises in February

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EU prepares CBAM export scheme

17/03/25

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17/03/25

EU prepares CBAM export scheme

Brussels, 17 March (Argus) — The European Commission is preparing a "solution" for exported goods under the bloc's carbon border adjustment mechanism (CBAM), to be presented before the end of the year. The commission will also expand the scope of the CBAM to "certain" steel and aluminium-intensive downstream products. The changes to the CBAM will be announced as part of a European steel and metals plan. In a draft of the plan to be formally presented on 19 March, the commission points to the need to address the problem of carbon leakage for CBAM goods exported from the EU to non-EU countries. The draft also notes that the commission is currently "quantifying" risks, before proposing an extension of the CBAM to "certain" steel and aluminium-intensive downstream products, so as to address the risk of European producers relocating outside the bloc to avoid higher carbon costs. The metals plan also announces an anti-circumvention strategy for the CBAM to be presented in the second half of 2025. The commission points to the risk of goods from low-carbon production facilities in non-EU countries being redirected to European customers, while carbon-intensive production continues for other markets. The metals plan also points to the risk of "greenwashing" carbon accounting practices, with "electro-intensive metals production benefiting from market-based instruments to appear low-carbon". The commission put forward proposals last month to simplify the CBAM, exempting some 90pc of the firms currently covered by the mechanism. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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