Canada Carbon Rebate to Offset Carbon Pricing Costs For Millions of Canadians

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Canada’s Prime Minister, Justin Trudeau, recently announced the rollout of the carbon rebate, now known as the Canada Carbon Rebate. This rebate is designed to offset the expenses Canadians incur from carbon pricing when purchasing gasoline and is distributed quarterly on the 15th of each month, starting from April. 

The Canada Carbon Rebate Program

The Canada Carbon Rebate (CCR), formerly known as the Climate Action Incentive Payment (CAIP), is a tax-free amount designed to help eligible individuals and families offset the cost of federal carbon price. It includes a basic amount and a supplement for residents of small and rural communities.

The amount Canadians receive from the carbon rebate varies depending on their province of residence and household size. Each year, the rebate is determined based on the anticipated revenue collected by the federal government from carbon pricing in each province. 

READ MORE: Canada’s $5 Billion Carbon Pricing Revenue Sparks Debate

For instance, a single taxpaying adult in New Brunswick can expect to receive approximately $95 in each quarterly payment. In contrast, a family of four in Alberta is likely to receive $450 per deposit. 

Provinces where fossil fuels contribute more to electricity generation receive higher rebates due to the higher carbon pricing costs borne by consumers. Starting from the last payment of the year, a 10% increase in the rural supplement acknowledges the greater energy needs of rural residents and their limited access to cleaner transportation options. 

This initiative is a cornerstone of Canada’s strategy to reduce emissions and build a sustainable future, as emphasized by Steven Guilbeault, Minister of Environment and Climate Change. He highlights that pricing pollution is an effective method to cut emissions while ensuring all revenues are returned to Canadians. 

The Canada Carbon Rebate aims to provide households with extra income every three months, supporting essential expenses such as groceries and rent. 

Canadians can use an online estimator tool to gauge their potential rebate, ensuring transparency and clarity in the process.

Here are the key details to keep in mind:

Distribution and Eligibility:

The Canada Carbon Rebate returns 90% of the revenue collected from the carbon levy to households in eight provinces where it is applicable. Provinces like British Columbia and Quebec, with their own carbon pricing systems, do not receive federal rebates.

Installments and Amount:

The rebate is distributed in four instalments annually, tailored to household size and province of residence. Families of four can expect to receive between $190 and $450 in this instalment.

Factors Affecting Rebates:

Provinces where fossil fuels contribute more to electricity generation receive higher rebates, reflecting higher carbon pricing costs borne by consumers in those regions.

The announcement also marks the deadline for small businesses to file tax returns to qualify for the new automatic refundable tax credit aimed at offsetting carbon pricing costs. This initiative replaces a previous grant system that saw limited success, returning only $35 million of an owed $2.5 billion from April 2019 to March 2024.

There have been challenges with bank deposits failing to clearly identify the rebates as intended by the government. This causes confusion among recipients. Recent legislative changes now mandate banks to use the label “CdaCarbonRebate” for these deposits, aiming to enhance clarity and transparency for recipients.

RELATED NEWS: Saskatchewan Achieves Legal Win Over Canada’s Federal Carbon Tax

These developments underscore Ottawa’s ongoing efforts to manage carbon pricing impacts on both households and small businesses. Overall, it reflects broader strategies to address climate change while supporting economic resilience.

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Eureka Moment! Amazon Hits 100% Renewable Energy Goal 7 Years Ahead

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July 10 marked an extraordinary moment for Amazon, reaching its 100% renewable energy goal a stunning seven years ahead of schedule. Originally set for 2030, the rapid transition across all operations surprised the world. So how did Amazon achieve this moment of massive success? Let’s discover…

Decoding Amazon’s Journey to 100% Renewable Energy

Bloomberg NEF reported that Amazon has invested billions in installing 500 solar and wind projects globally. This is enough to power 7.6 million U.S. homes. The retail giant has been the world’s top corporate buyer of renewable energy in the last four years. They have set an example by adapting to the growing demand for AI while exploring new energy sources and approaches for achieving carbon neutrality.

Amazon’s Chief Sustainability Officer Kara Hurst has elaborately said,

“Reaching our renewable energy goal is an incredible achievement, and we’re proud of the work we’ve done to get here, seven years early. We also know that this is just a moment in time, and our work to decarbonize our operations will not always be the same each year—we’ll continue to make progress, while also constantly evolving on our path to 2040. Our teams will remain ambitious, and continue to do what is right for our business, customers, and the planet. That’s why we’ll continue investing in solar and wind projects, while supporting other forms of carbon-free energy, like nuclear, battery storage, and emerging technologies that can help power our operations for decades to come.”

MUST READ: US Corporations Ramp Up Renewable Energy, Amazon Leads the Pack

Once all projects are operational, they can remove approximately 27.8 MMT CO2 annually. Here are some remarkable achievements driving Amazon’s transition to 100% renewable energy:

Mississippi’s Wind Farm Powering Amazon Data Centers

Delta Wind, one of the Mississippi’s largest wind farms supplies carbon-free energy to power Amazon’s local operations and data centers. Apart from this, Amazon has also partnered with Entergy to develop 650 MW of new renewable energy projects in Mississippi over the next three years. It aims to reach 1.3 GW of clean energy through solar and wind farms in the state.

Amazon Leads in Offshore Wind Projects in Europe

Currently, Amazon supports 1.7 GW capacity across six offshore wind farms in Europe. It expects to power 1.8 million average European homes once they become 100% operational. This makes Amazon the top corporate purchaser of offshore wind globally.  The 750 MW Amazon-Shell HKN Offshore Wind Project which began operations last year, provides renewable energy across the Dutch coast.

Expanding Renewable Energy in Asia Pacific

Amazon has a robust grip over the Asia Pacific region. Its portfolio includes 80 renewable energy projects throughout India, Australia, China, Indonesia, Japan, New Zealand, Singapore, and South Korea. The company invested in 50 wind and solar projects with a total capacity of 920 MW in India, alone.

As the largest corporate purchaser in Japan, Amazon has enabled 20 projects, including 14 onsite solar installations and six offsite wind and solar projects. Amazon has helped Japan overcome its energy challenges. It works closely with industry groups and policy stakeholders to expand renewable energy procurement in the corporate sector.

AI Powers Solar Storage for 24/7 Energy

Energy demand for decarbonizing the grid is unstable when reliant on solar and wind power. Amazon believes incorporating AI and ML in carbon-free energy (CFE) can be a game-changer for grid stability. The company has developed a unique formula for installing battery storage systems with solar projects to ensure an uninterrupted CFE supply. A recent blog post highlights the significance of the Baldy Mesa solar farm, operated by AES, where machine learning models from Amazon Web Services (AWS) predict optimal times for the battery to charge and discharge energy. This innovation enhances the efficiency of solar-powered projects, even when sunlight is limited.

According to the International Energy Association (IEA),

“The global fleet of wind turbines generates over 400 billion data points annually. AI and ML models can use this data to enhance the efficiency of carbon-free energy projects.”

Amazon’s Net Zero Strategy and Carbon Footprint 

Amazon’s goal is to achieve net zero carbon emissions by 2040. This is a decade ahead of the Paris Climate Agreement timeline. By joining the Climate Pledge, Amazon believes in regularly measuring and reporting their GHG emissions, implementing decarbonization strategies, and using credible carbon offsets to neutralize any remaining emissions.

source: Amazon 2023 sustainability report

According to its annual sustainability report, Amazon reported a 3% reduction in overall emissions in 2023. Its total emissions fell from 70.74 MMT CO2e equivalent in 2022 to 68.82 MMT CO2e in 2023, with meeting the target of 100% renewable electricity globally.

FURTHER READING: Amazon’s Carbon Emissions Take a Green Turn with Renewables

The post Eureka Moment! Amazon Hits 100% Renewable Energy Goal 7 Years Ahead appeared first on Carbon Credits.

Wood Mackenzie Predicts $196 Billion Investment in CCUS by 2034

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Wood Mackenzie, the global leader in providing data analytics and solutions in sustainability and renewable energy has recently rolled out a media statement on cost brackets for expanding CCUS, worldwide. It has predicted an investment of around $196 billion in 2034.

What Does Wood Mackenzie’s 10-Year CCUS Market Forecast Say?

In this analysis, Wood Mackenzie has estimated that global carbon capture capacity can surge up to 440Mtpa and storage capacity will go up to 664 Mtpa. The combined process will require $196bn of total investment by 2034 out of which USD 80B is expected to come from the North American and European Governments. 

We have discovered from the report that nearly half of global investment focuses on CO2 capture. The remaining half will be distributed between the transport and storage sectors at $53B and $43B, respectively. Plans are underway to allocate 70% of the total value chain investment in North America and Europe. The report has further emphasized that increasing production projections does not mean that Wood Mackenzie expects carbon capture supply to meet immediate demands. Long-term projects anticipated for 2034 need up to 640 Mtpa of CO2 storage, but expected commissions are lacking by 200 Mtpa.

Hetal Gandhi, APAC CCUS lead with Wood Mackenzie has put her insights in the press release.

She said out of the total announced projects, 71% are in North America and Europe, backed by government incentives. The US Inflation Reduction Act, UK business models, Canada’s Investment Tax Credit, and the Netherlands SDE++ scheme are key contributors. The new EU Industrial Carbon Management Strategy is also expected to boost European projects. She highlighted that China and India are the largest emitters in the Asia-Pacific region but lack proper CCS infrastructure.

Her predictions say that the power and chemical sectors will face significant gaps between demand and supply until 2034. This region needs utmost CCUS upgradation. Notably, China, India, Latin America, the Middle East, and Africa face development constraints due to a lack of policy, regulatory frameworks, and funding support. Government funding for CCUS in key countries totals around $80 billion. The US leads with 50% of the total, followed by the UK at 33% and Canada at 10%.

MUST READ: Australia Has A US$400B Carbon Capture Opportunity, Wood Mackenzie Says

source: Wood Mackenzie

Using the Investment Effectively, A Wood Mac Study

Following the previous analysis, WoodMac has deep-dived into the role of CCUs in global decarbonization. The research wing has analyzed that some countries are investing in CCUS to decarbonize tough sectors like cement, chemicals, steel, refining, and power. On the other hand, some view CCUS as a long-term decarbonization tool.

 Hetal has schemed out some important points to effectively utilize the investment. She believes that CCUS can be most effective when the technology is affordable and sustainable infrastructure is in place for carbon capture and storage. The key focus should be on heavy emitters.

CCUS has garnered significant attention for addressing climate change. Currently, the global CCUS capacity is around 63 Mtpa, which might surge to 1,700 Mtpa by 2050. However, to keep global warming within 1.5 degrees above pre-industrial levels, capacity would need to reach 7,750 Mtpa. Presently, most CCUS projects are targeting the power and gas sector. In the future, CCUS will be crucial for the cement and steel industries, which have limited alternatives to fossil fuels. The production of blue hydrogen will also benefit significantly from CCUS.

Click here to know what 2024 looks like for CCUS, as per Wood Mac.

source: Wood Mackenzie

CCUS Future: Challenges Amid Opportunities

Wood Mac has also outlined some of the challenges of CCUS. The team analyzed that despite progress, CCUS uptake remains limited. Fauzi Said, senior research analyst at Wood Mackenzie, has developed one solution focusing on hub-based storage ecosystems. He said,

“With storage capacities more concentrated than the spread-out capture capacities, hub-based storage ecosystems will evolve especially in Europe and APAC.”

CO2 sequestering costs are high compared to current carbon prices and practically no revenue is in it. Successful projects have managed costs with incentives, but future success relies on effective policies and well-structured carbon pricing schemes. Furthermore, amine-based processes dominate CCUS, which is not enough. They need more advanced technology to capture CO2 cheaply and with scarce carbon concentration. Another challenge is carbon dioxide’s corrosive nature which makes transportation costly and storage challenging. Thus, cost is a significant factor driving the process.

source: Wood Mackenzie

However, in last month’s Wood Mac’s report, we discovered that ExxonMobil has established a strong position in the US CCUS. Wood Mackenzie made a detailed study that figured out, “The company’s US portfolio achieves a weighted average return of 20% in their base case. Some projects yield even higher returns.”

We hope Wood Mackenzie will come up with more updates on global CCUS status and developments very soon.

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Silver Lining: Soaring Demand Outstrips Supply, Pushing Prices to The Roof

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Silver is at the heart of the clean energy transition, essential for solar cells and electric vehicles (EVs) due to its unmatched conductivity. As demand from the photovoltaic industry surges, outpacing supply, silver’s pivotal role highlights both the opportunities and challenges in achieving a sustainable future.

Silver experts highlighted significant challenges in meeting global demand despite robust price signals favoring increased metal production amid the expanding energy transition. This metal plays a critical role in EVs and solar cells, with demand surpassing supply in recent years, leading to depleted inventories. 

According to the Silver Institute, photovoltaics alone are projected to account for 19% of global silver demand in 2024, equivalent to 232 million ounces. This represents almost a 20% increase from 2023 and a substantial 96% surge from 2022 levels.

Anticipating a deficit of 215.3 million ounces in 2024, the Silver Institute forecasts that industrial applications will drive 58.3% of the world’s total demand of 1.2 billion ounces. However, global silver supply primarily results from byproduct production associated with other metals. Moreover, despite high prices, there’s limited incentive for new production.

Shining Spotlight on Silver

Adrian Day from Adrian Day Asset Management emphasized the severity of the silver deficit, attributing it to surging demand from sectors like solar panels and EVs, which have seen demand triple in 3 years. He noted that inventories are critically low with no substantial stockpiles available to mitigate the shortage.

Day further underscored that only about 30% of silver production comes from primary silver mines, with the majority being sourced as a byproduct. This setup means that the supply of newly mined silver does not respond proportionately to price fluctuations. As a result, this could lead to heightened price volatility.

Silver prices have surged significantly this year, prompting speculation about their potential peak in the remaining 6 months. A crucial element to monitor is the supply and demand dynamics, as silver demand consistently exceeds supply.

Historically, silver demand was evenly split between industrial use and investment. However, industrial demand has surged recently, now accounting for 64% of global silver demand, a 19% increase from the previous year.

The World Silver Survey reports that 2024 marks the 5th consecutive year of a silver shortage. In 2023, demand exceeded supply, resulting in a market deficit of over 142 million ounces. This shortfall is projected to nearly double to 265 million ounces by the end of 2024 due to rising industrial demand.

This upward trend is expected to continue, driven primarily by the Green Energy Transition, especially solar energy. 

Photovoltaic Surge: Solar Energy’s Growing Appetite for Silver

A growing solar power industry is fueling up the surge in the demand for silver, essential for manufacturing photovoltaic (PV) panels. Due to its high electrical conductivity, thermal efficiency, and optical reflectivity, silver is integral to solar PV production. Consequently, mining companies are aiming to boost output as silver prices climb to decade highs.

Global investment in solar PV manufacturing more than doubled last year to around $80 billion, accounting for 40% of global investment in clean-technology manufacturing, according to the International Energy Agency (IEA). China significantly increased its investment in solar PV manufacturing between 2022 and 2023.

Global renewable capacity increased by 50% to nearly 510 gigawatts last year—the fastest growth rate in 3 decades. Three-quarters of this growth came from solar PV energy, as reported by the IEA.

SEE MORE: IEA’s 2023 Net Zero Roadmap: Tripling Renewables and Electrifying the Energy Transition

Demand for silver from solar PV panel manufacturers, especially in China, is forecast to increase by almost 170% by 2030. The amount could reach about 273 million ounces, which would constitute about one-fifth of total silver demand, according to investment manager Sprott.

Coeur Mining is expanding to meet the rising silver demand, completing a significant expansion of a mine in Nevada, which will become the largest source of domestically produced silver in the U.S.

London-based Hochschild Mining is also expanding its silver operations, aiming to secure permits for a silver project in southern Peru later this year. Scheduled to start production in 2027, the project is expected to add 50 million ounces of silver annually.

Some experts noted that given the underlying industrial demand dynamics and existing supply constraints, the industry may be seeing the start of a silver bull market.

Silver’s New Gold Rush

The boom in demand has led to soaring silver prices, reaching $31.3/oz as of writing. This price surge has bolstered the share prices of silver miners. 

However, rising silver prices might force solar PV panel manufacturers to increase their prices later this year.

Paul Wong, a market strategist at Sprott, predicts that silver could see a rise similar to gold, which hit eight straight sessions of record highs in April. Despite trailing gold’s popularity with central banks and sovereign institutions, silver maintains a strong correlation with gold. Wong expects substantial buying from the photovoltaic industry to drive further silver demand, noting that:

“Similar to how gold bullion has soared due to a new wave of major purchasers among central banks and sovereign entities, silver has and will likely see even more substantial buying from the photovoltaic industry.”

Discussing government influence on silver mining, industry leaders highlighted regulatory policies in major jurisdictions like Mexico. The South American nation can either stimulate or deter investment in silver projects due to lengthy permitting processes. 

As silver demand continues to soar, driven by its critical role in solar power and the clean energy transition, the industry faces significant challenges in meeting global needs. Despite robust price signals and increased production efforts, the supply constraints highlight the urgency for innovative solutions and strategic investments to sustain this pivotal resource’s future.

READ MORE: Silver’s Crucial Role in Achieving a Net Zero World

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Brick by Brick: Lego Builds a Net Zero Future With Stricter Carbon Reductions for Suppliers

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Lego, the world’s leading toy manufacturer, is taking significant steps to meet its net zero goals by mandating that its suppliers set near-term emissions reduction targets by 2026 under its new Supplier Sustainability Program. This initiative is crucial for Lego to stay on track with its commitment to reducing its carbon footprint by 37% by 2032 and achieving net zero by 2050. 

Carsten Rasmussen, Lego’s Chief Operations Officer, emphasized the importance of sustainability in business operations and supplier selection. He stated, 

“Sustainability is a license to operate and a requirement of how we do business, including how we select our suppliers. We have ideas and we have a pathway; we cannot do it alone.”

Lego’s Colorful Path to Net Zero 

The toy industry produces an estimated 26 million metric tons of greenhouse gas (GHG) emissions annually. But the industry rarely makes public commitments regarding supplier emissions, making Lego stand out with this announcement. 

The Danish toy maker’s initiative builds on a 2014 program aimed at measuring and mitigating the environmental impact of its close partners, involving 158 suppliers as of December’s sustainability progress report.

The Lego Group’s 2050 net zero emissions pledge includes Scope 1, 2, and 3 emissions. Notably, 99% of Lego’s emissions stem from Scope 3 activities, which include the entire supply chain. 

Source from Lego’s website

Setting a long-term goal helps ensure the company achieves its climate targets, with the immediate priority of meeting its 2032 carbon reduction goals. The toy manufacturer employs various initiatives to reach those goals and has increased spending on climate actions by 60% in 2023 versus 2022. 

Their major initiatives include the following and their sustainability 2023 progress:

Increasing capacity and production of renewable energy at sites:

Reduced absolute emissions across manufacturing sites, stores, and offices.
Increased production of renewable energy in factories and purchased renewable energy for factories, offices, and stores.
Commenced construction of a new factory in Vietnam and broke ground on a new factory near Richmond, Virginia, USA, both with solar facilities to match total annual energy requirements.
Increased solar capacity investments by adding 2.2 MWp, bringing peak capacity to 15.6 MWp across production sites in Denmark, the Czech Republic, Hungary, Mexico, and China (16% increase from 2022).
Planning to build a solar park in Billund, Denmark, to cover energy requirements of offices and sites in the town, expected to be operational in 2027.

Taking CO2 emissions into account across all business decisions:

Implemented shadow carbon pricing on key investments to encourage low-carbon initiatives.
Ensured emissions related to new investments are considered before financial decisions.
Established responsible travel guidelines to reduce employee travel, particularly international air travel, by 50% by 2032 compared to 2019.

Joining forces with suppliers to collectively reduce environmental impact:

Continued collaboration with suppliers through the Engage-to-Reduce program (established in 2014).
Engaged 158 suppliers in 2023, up from 138 in 2022, marking a 14.5% increase.

An Expensive Climate Commitment

Source from Lego’s website

Lego also plans to triple its investment in environmental sustainability over the next 3 years, spending over $1.4 billion. 

This investment will support designing carbon-neutral factories and buildings, increasing renewable energy production and acquisition at its plants, offices, and stores, and incorporating carbon dioxide emissions into all corporate decisions. 

This move places the company alongside industry rivals Hasbro and Mattel, who have made similar environmental pledges. In 2022, Hasbro set goals to reduce greenhouse gases by 40% by 2030 and achieve net zero emissions by 2050. Mattel committed to reducing plastic packaging by 25% per product by 2030.

SEE MORE: Barbie’s $1.3B Movie and Green Shift: Hollywood Meets Sustainability

One of the toy industry’s biggest challenges is plastic use; it uses nearly 1% of global plastic production.

Lego’s total footprint for 2022 was about 1.6 million metric tons, up from 1.5 million metric tons in 2021. Finding alternatives to plastic is a top priority for the company, though reducing plastics and cutting emissions don’t always align. 

In September, Lego backed away from a commitment to make its bricks entirely from recycled plastic as it wouldn’t significantly reduce emissions. 

To date, Lego has tested over 600 materials, including bio-polyethylene, used in botanical elements and Minifigure accessories. In 2023, 18% of the resin purchased for bricks was from renewable or recycled sources mixed with virgin materials.

From Playtime to Planet-Saving Actions

Additionally, Lego will invest in global carbon reduction initiatives, such as supporting carbon capture programs like that of Climeworks. In 2023, Lego entered an agreement with Climeworks, investing US$2.4 million in their carbon capture and storage services. 

Climeworks specializes in removing historic and unavoidable CO2 emissions from the atmosphere through direct air capture and storage facilities. The process involves drawing air into large collector containers, capturing the CO2 on a filter, and then storing the collected CO2 deep underground in Iceland with Climeworks’ storage partner, Carbfix. This CO2 is eventually transformed into stone through an accelerated natural process.

RELATED NEWS: Shell’s Polaris Project Fuels Canada’s Carbon Capture Revolution

This initiative reflects Lego’s commitment to addressing both current and historical carbon emissions, further enhancing its efforts to achieve net zero emissions by 2050.

By implementing these measures, Lego is taking a leadership role in sustainability within the toy industry, pushing for broader environmental responsibility and innovation among its suppliers and beyond.

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Rimba Raya Resumes Operations in Borneo with Epic Legal Victory

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Rimba Raya, the world’s largest carbon offset REDD+ project developer, has won a legal victory in Indonesia. This win is a significant step towards resuming operations at their expansive site in Borneo. As reported by Bloomberg on July 11, the Jakarta State Administrative Court overturned Indonesia’s Ministry of Environment and Forestry’s decision, thereby restoring the license for the Rimba Raya Conservation project.

Rimba Raya: Absorbing Carbon Emissions and Generating Carbon Credits

The Rimba Raya project in Indonesian Borneo generates carbon credits by conserving a forest area nearly the size of Las Vegas. These credits mainly come from its High Conservation Value (HCV) peat swamp forest, making it one of the world’s largest REDD+ projects. This unique area separates oil palm plantations from Tanjung Puting National Park, which hosts a vast orangutan sanctuary and has a rich biodiversity. This makes Rimba Raya an excellent conservation project.

Another notable feature of Rimba Raya is its extensive coastal tropical heath and peat swamp forest, which once blanketed much of southern Borneo. This vast swamp area actively removes approximately 130 million tonnes of carbon emissions.

Rimba Raya project was the first REDD+ initiative to be validated under the Verified Carbon Standard (VCS) and achieved triple-gold validation from the Climate Community and Biodiversity Alliance Standard (CCBA).

CarbonPlan, the climate data provider has reported that Rimba Raya has issued more than 30 million credits since 2013 and more than 25 million of those have been retired. This makes it the world’s largest single source of offsetting.

The Epic Legal Victory Fuels Rimba Raya’s Revival

The legal case continued for almost a year, after which the Jakarta State Administrative Court gave its ruling in favor of Rimba Raya. From various credible media resources, we discovered that Rimba Raya can now operate across 36,000 hectares of tropical peat swamp forest in Central Kalimantan, the largest Indonesian province by area.

Rusmin Widjaja, President of The Board of Directors at PT Rimba Raya Conservation

Rimba Raya Conservation will now focus on rebuilding its capacity and is also working to resolve a separate dispute with its partner, Hong Kong-based InfiniteEARTH Ltd.

Going Back in Time of License Revocation and Legal Battle

In April carboncredits.com reported that The Indonesian Ministry of Environment and Forestry cited three main violations by PT Rimba Raya Conservation: The main allegation was the unauthorized transfer of the permit to a third party without approval from the Minister of Environment and Forestry. The second accusation was conducting carbon trading transactions beyond its licensed area, violating its agreement with Tanjung Puting National Park. The company also faced criticism for failing to pay Non-Tax State Revenue (PNBP) as required by the law.

According to Bloomberg, this decision had put the future of the Rimba Raya project at risk. It was significantly worrisome for prominent carbon traders like InfiniteEARTH Ltd and Carbon Streaming Corps who have heavily invested in Rimba Raya’s credits. The situation showcased how complex supply chains and uncertain regulations pose challenges, even though carbon offsets are crucial for projects like Rimba Raya.

KNOW MORE: Rimba Raya REDD+ Project Revocation Rattles Carbon Market

The Future of Rimba Raya: A Bloomberg Analysis

However, the recent court ruling lets Rimba Raya restart activities, rebuild capacity, and resolve disputes with InfiniteEARTH. How will this decision affect the Indonesian carbon credit market and Rimba Raya’s investors? Let’s read the Bloomberg analysis.

Will carbon credit demand rise?

BloombergNEF predicts that demand for these credits could rise sharply, possibly reaching a market value of $1 trillion by 2050. Despite turbulence and differing opinions on credibility, the demand for carbon offset credits is expected to increase in the future. Analysts at BloombergNEF (BNEF) foresee a significant expansion in VCMs, even as companies like Alphabet Inc., Google’s parent company, reassess their involvement.

Bloomberg tried to reach the Indonesian government and the CEO of PT Rimba Raya Conservation for their views but in vain.

Impact on partners and investors

The uncertainty around Rimba Raya’s future has impacted its partners and investors. Verra has temporarily suspended InfiniteEARTH’s account while clarifying its role with PT Rimba Raya. This consequently affected the fair value of the Rimba Raya stream, nullifying it to zero on March 2024.

On May 31, 2024, the company announced major management and board changes. Christian Milau, the former CEO of Equinox Gold, has been appointed as the new interim CEO, with Olivier Garrett taking on the role of board chairman.

However, on a positive note, Carbon Streaming, which has an agreement with InfiniteEARTH for Rimba Raya credits, is evaluating the situation. They are communicating with partners and considering the legal options to protect their investment. The company promised to continue the project, despite unclear regulations in Indonesia, as noted in its Annual Information Form on the SEDAR+ platform. Meanwhile, InfiniteEARTH argued that Indonesia’s legal framework for carbon projects lacks clarity and denied any wrongdoing.

Indonesia plans to lift its ban on overseas credit sales to boost revenue, ensuring compliance with carbon trading rules and the Paris Agreement. All in all, this epic ruling on Rimba Raya is going to etch a history in Indonesia’s carbon credit market.

FURTHER READING: What Makes Forest Project a High-Quality Carbon Removal? 

Disclaimer: Data and facts have been collected primarily from Bloomberg.

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Lithium Markets in Limbo: Next Leg Up or Down?

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In the quest for electrification and cleaner energy sources, all eyes are on lithium, a.k.a. white gold, and how the market strives with battery prices continuing to fall.

According to BloombergNEF, the dramatic lithium price dropping trend will persist for several years, making battery technology economically viable for global decarbonization efforts. Benchmark Mineral Intelligence echoes this sentiment, highlighting the impending lithium market expansion driven by surging EV demand. 

What Drives Lithium Battery Prices Down?

In the past year, the price of lithium iron phosphate (LFP) battery cells in China has dropped 51% to an average of $53 per kilowatt-hour (kWh), which is significantly lower than the global average of $95/kWh last year, per BloombergNEF. 

This price decrease is driven by several factors, including:

Falling Raw Material Prices: Raw material costs, particularly for the cathode, have sharply declined. The cathode’s share of total costs for LFP cells in China dropped from 50% in early 2023 to under 30% this year.
Overproduction: China’s battery production capacity exceeds global electric vehicle (EV) demand, leading manufacturers to cut prices to maintain market share. Average capacity utilization in Chinese battery plants fell from 51% in 2022 to 43% in 2023 and is expected to decrease further.
Technological and Manufacturing Improvements: Companies like CATL and BYD are investing heavily in R&D, automation, and new factories, launching new products rapidly.

RELATED NEWS: EV Wars and Breakthroughs: BYD to Overtake Tesla, CATL’s New Battery With 1.5M KM Range

A MESSAGE FROM Li-FT POWER

One of the most essential ingredients in the production of batteries, lithium powers some of the most important devices in our everyday lives. Dramatic lithium price dropping trends will persist for several years making battery technology economically viable for global decarbonization efforts. Li-FT Power Ltd. (TSX-V: LIFT | US: LIFFF) is the fastest developing North American lithium junior. Click here to learn more about their vast lithium assets including their flagship project, a 100%-owned Yellowknife Lithium project. 

A Bright Prediction for Lithium Batteries

BloombergNEF predicts that low lithium battery prices will persist for several years, significantly impacting the automotive and power sectors. At $50/kWh, battery technology is already economically viable for decarbonizing road transport globally.

A major evidence is on point. In China, pack-level prices for the most common battery chemistries have been below the $100/kWh benchmark since October 2023. Lithium iron phosphate (LFP) pack prices are now at $75/kWh, making EVs competitive with combustion cars in most segments.

Chart from BloombergNEF website

Additionally, Chinese EVs are now the cheapest drivetrain by average transaction price, even excluding mini-city cars. This shift will gradually reflect outside China, benefiting commercial EV manufacturers and reducing the premium they pay for batteries.

Chart from BloombergNEF

With the lithium battery prices dropping fast, another market stands to gain a lot from it – energy storage. 

Turnkey energy storage systems are 43% cheaper than a year ago. Global stationary storage installations are projected to rise to 155 GWh this year, up 61% from last year, according to BNEF data.

The narrative of perpetual battery and battery metal shortages has been challenged by recent developments. For instance, Toyota’s assertion last year that there were not enough batteries to meet global demand now appears outdated as battery prices continue to fall.

In fact, the substantial drop in battery prices in China could revolutionize the global automotive market by making EVs more affordable and accelerating the transition to renewable energy storage solutions. 

More notably, it signals that the lithium market is on the verge of a significant expansion in the coming years, as what the Benchmark Mineral Intelligence highlights in its Q2 2024 Lithium Market Overview. Benchmark is a prominent provider of independent data and advisory services for the lithium-ion battery and EV supply chain. 

On the Brink of a Major Expansion

While short-term volatility is expected, long-term prospects indicate a structural deficit as the lithium supply struggles to keep pace with the accelerating EV revolution. 

READ MORE: Lithium Prices Fall to 35-Month Low Amid Surging EV Sales

According to Benchmark’s latest report, global lithium demand is projected to reach 1.15 million tonnes of lithium carbonate equivalent (LCE) by 2024, with an astounding 87% driven by batteries, particularly EVs—the dominant end-use application. 

Looking ahead, demand is forecasted to more than double, reaching 2.89 million tonnes LCE by 2030. Batteries account for a staggering 94% of consumption, while industrial uses like glass and ceramics decline to just 6% of the total.

Simon Moores, CEO of Benchmark Mineral Intelligence remarked on this trend, saying:

“The lithium market is facing a demand tsunami from the rise of EVs that will put immense pressure on supply. Every auto maker has ambitious EV targets, and lithium-ion batteries are the enabling technology.”

On the supply side, Australia led lithium production in 2023 with a 40% global market share from hard rock mines, followed by Chile at 24%. However, Chinese production is anticipated to surpass Chile by 2025 as new projects come online. 

Geographical diversification in lithium mining will increase as the market expands, yet the concentration of lithium chemical production remains high in China and South America. Significant capital investments are deemed necessary to expand current operations and meet future demand.

Benchmark’s price forecast sees spodumene concentrate, a key driver of lithium chemical prices, to average $5,000 per tonne longer-term. This translates to a lithium carbonate price of around $30,000 per tonne.

What All These Mean for Investors?

For investors, the lithium market’s growth trajectory presents opportunities across producers like Albemarle, SQM, Ganfeng Lithium, and Pilbara Minerals, as well as battery manufacturers, EV makers, and ETFs focusing on the EV supply chain. Moores emphasized that white gold is pivotal in unlocking the EV and clean energy revolution. This calls for unprecedented scaling that hinges on significantly higher prices. 

Investors must meticulously navigate opportunities and threats in this dynamic market.

LITHIUM COMPANY SPOTLIGHT: Li-FT Power: The Fastest Developing Lithium Junior 

Despite recent challenges such as oversupply and lower-than-anticipated EV sales in China, which led to substantial price declines for lithium carbonate, the long-term outlook remains optimistic. Anticipated strong rebound in demand with accelerating global EV adoption suggests potential price recovery from 2025 onwards. 

But the caveat? Sustained high prices are necessary to incentivize new supply to meet future demand for lithium through the decade.

The post Lithium Markets in Limbo: Next Leg Up or Down? appeared first on Carbon Credits.

A Carbon Scam? BP-Owned and US Largest Offset Company’s Credits Are 80% Dubious

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Some forest carbon offsets sold by Finite Carbon, the largest offsetting company in the US, offer minimal climate benefit, according to a satellite analysis by Renoster and CarbonPlan.

Finite Carbon, founded in 2009 and acquired by BP in 2020, manages over 60 projects covering 1.6 million hectares. These offset projects generate a quarter of the US’s carbon credits. 

Finite’s business model involves encouraging landowners to protect forests that are supposedly at risk of being cut down. The carbon absorbed by these protected trees generates credits, which polluters can purchase to offset their emissions. 

Since 2009, Finite claims to have offset over 70 million tonnes of emissions—more than double BP’s total emissions last year.

However, the credibility of Finite’s projects is under scrutiny amid rising concerns about the global carbon offset industry, which Barclays predicts could be worth $1.5 trillion by 2050. 

An analysis of three projects, representing nearly half of Finite Carbon’s credits valued at $334 million, revealed significant issues. Their findings were alarming: about 80% of the credits should not have been issued.

Finite’s Carbon Offsets Under the Microscope

The scrutiny of Finite Carbon’s offsets coincides with growing concerns about the carbon offset industry. US Treasury Secretary Janet Yellen recently emphasized the need to address the industry’s significant challenges.

RELATED NEWS: Google Ditches Carbon Offsets, Here’s Its New Net Zero Focus

Finite Carbon defended its offsets, stating that all projects are independently verified and developed according to California’s cap-and-trade program standards. 

The offsets developer sells most of its credits under California’s cap-and-trade system, which requires excessive polluters to buy offsets. Critics argue that flawed credits allow companies to continue polluting with impunity.

Finite’s offsetting process involves calculating a baseline of how many trees would be cut down without the project. 

Renoster, an agency used by carbon credit buyers to verify real climate benefits, found significant issues in Finite’s offset projects. 

One project in the Alaska Panhandle included trees not at risk of being cut down, resulting in about 79% of the credits being deemed invalid by Renoster.

Finite’s Sealaska project, covering 67,000 hectares, generated credits valued at over $100 million. The rating agency found that trees in the project area were unlikely to be cut down due to extensive prior logging, making the credits unjustifiable. They were in locations inaccessible to loggers, such as ravines and coastlines.

Finite’s approach of excluding logged areas and creating maps around small pockets of forest, sometimes fewer than 50 trees, may comply with technical rules but undermines the spirit of the regulations. 

Gerrymandering Credits: The Integrity Crisis in Carbon Offsetting

Thus, Renoster concluded that the project’s credits should not have been issued, labeling the practice as “cheating,” accusing them of intentionally manipulating project boundaries to maximize credits. Elias Ayrey, Renoster’s head scientist, criticized this “gerrymandering,” which makes assessing real conservation efforts impossible.

Sealaska representatives defended the credits, claiming the remaining trees had economic value and could legally be cut. Brian Kleinhenz, a former Sealaska executive, argued that there was always market value for the trees, even in difficult-to-access areas. 

The California Air Resources Board (CARB) supported the inclusion of these trees in baseline calculations. CARB spokesman Dave Clegern acknowledged concerns but maintained that projects are in compliance with all regulations.

Another Finite project analyzed is a 200,000-hectare forest in Washington state, owned by the Confederated Tribes of the Colville Reservation. It significantly overestimated the logging threat, according to CarbonPlan scientist Grayson Badgley. He noted that awarding credits for avoiding unlikely logging activities undermines the integrity of offsets.

Chart from SourceMaterial website Note: Finite Carbon timber harvest projection vs the tribe’s submitted management plan

The third project in West Virginia, covering 39,000 hectares and involving Lyme Timber, which promised to preserve trees in exchange for credits, was also found to be over-credited. Renoster concluded that many trees were in steep, inaccessible areas, making logging economically unfeasible. 

Lyme Timber president David Hoffer contested Renoster’s findings, asserting that their harvesting practices have been conservative.

A Path Forward for the Carbon Offset Industry

Finite Carbon’s controversial offset projects highlight the complexities and challenges within the carbon offset industry. The scrutiny underscores the urgent need for increased transparency and accountability in the carbon offset market. 

Amid all this turmoil, the moment represents a pivotal opportunity for the industry to evolve and enhance its credibility.

By implementing more rigorous verification processes, embracing advanced monitoring technologies like satellite analysis, and fostering collaboration among stakeholders, the carbon offset market can refine its practices and restore confidence. Ultimately, these steps will help ensure that carbon credits genuinely contribute to mitigating climate change.

READ MORE: Will This Be The End of Carbon Offsets?

The post A Carbon Scam? BP-Owned and US Largest Offset Company’s Credits Are 80% Dubious appeared first on Carbon Credits.

Truck Titans Clash: Tesla Semi vs. Nikola Hydrogen

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The battle between Tesla and Nikola in the zero-emissions trucking world is thrilling. Tesla Semi’s all-electric power goes head-to-head with Nikola’s hydrogen-fueled trucks. The clash is driving innovation, breaking tech barriers, and shaping a greener future. Who will emerge supreme in the clean transport transition? Let’s read this interesting analysis…

Tesla’s Next Gen Semi Trucks

Tesla is ramping its green goals with a $3.6 B investment to expand Gigafactory Nevada at the Truckee-Reno Industrial Center. This major expansion introduces two key additions: a 100 GWh 4680 Cell Factory for advanced batteries and a High-Volume Semi Factory for Tesla’s new electric trucks. They want to establish Gigafactory Nevada as the main for manufacturing unit for EV trucks.

Tesla disclosed that combination trucks account for approximately 18% of U.S. vehicle emissions. The new cell factory will manufacture 1.5 million batteries annually for light-duty vehicles. Media reports say that till the end of last year, Tesla manufactured 70 Semi trucks, using them mainly within the company and for its partner PepsiCo.

We can comprehend the status of the Tesla Semi from the VP of Vehicle Engineering at Tesla- Lars Moravy’s statement.

“We’re finalizing the engineering of Semi to enable like a super cost-effective high-volume production with our learnings from our fleet and our pilot fleet and Pepsi fleet, which we are expanding this year marginally. In parallel, as we showed in the shareholders’ deck, we have started construction on the factory in Reno. Our first vehicles are planned for late 2025 with external customers starting in 2026.”

Tesla Semi-All Electric Specifications

Nikola Promises Zero Emissions Class 8 Hydrogen Truck

Talking of Nikola, the company has already sold 72 units of Class 8 Hydrogen Fuel Cell Trucks through its HYLA brand. That is insanely impressive as they have exceeded their sales target of 60 units for Q2, 2024. Notably, their shares also shot high with this massive sales volume. Nikola CEO Steve Girsky exuberantly said,

“We have maintained our 2024 momentum with solid wholesale numbers, new customers such as Walmart Canada, and repeat customers like 4GEN and IMC, purchasing vehicles through our dealer network. We are firmly on the field and are continuing to secure our first-mover advantage in zero-emissions Class 8 trucks in North America, as well as with our HYLA hydrogen refueling solutions.”

READ MORE: What EV Demise? Tesla Stock Hit Highest Levels 

Nikola Class 8 Hydrogen Powered Truck Specifications

The market is supercharged with Tesla Semi and Nikola Hydrogen Class 8 competition. Some burning questions arise with these new launches…What will customers choose and what is the best model for net zero? Let’s do some comparison and analysis here. 

Who will Win the Battle of the Trucks; Hydrogen or EV for a Net Zero Future?

Michael Lohscheller, Nikola’s President and CEO, emphasized the growing demand for zero-emissions trucking solutions among customers who aim to fulfill their shipping needs and meet their ESG goals. He highlighted the shift’s significant impact. One heavy-duty zero-emission truck reduces CO2 emissions as much as removing 23 gasoline-powered cars annually.

Both Nikola and Tesla are advancing clean transport with zero emissions. The difference is Nikola’s latest trucks run on hydrogen, while Tesla Semi relies on all-electric power.

Off Infrastructure, Charging, and Refueling…

There are 76 hydrogen refueling stations in the U.S., of which 66 are installed in California. Nikola must ramp up way higher to be a long-term player. Even though, hydrogen refuels faster, locating a proximal station might be challenging.

On the contrary, Tesla’s supercharger network is extensive and the EV charging infrastructure is easily accessible. Charging time is significantly reduced with advanced battery and charging technology. This makes EVs more energy-efficient, offering a quick choice to customers. Overall, Semi wins bonus points here with Musk claiming

“Semi Trucks are about to revolutionize the road!”

While the Tesla Semi hasn’t hit the market yet, Nikola’s Class 8 Hydrogen Trucks are already cruising the roads. This gives Nikola ample time to earn the trust of its valued consumers and solidify its market position. As for Tesla’s Semi, its on-road performance remains speculative for now.

P.S. Refer to the images to compare and understand the specifications, sourced from Nikola and Tesla’s official website. 

In conclusion, both transport giants are sprinting toward achieving net zero goals. Tesla and Nikola are positioned for a win-win scenario in terms of technology and infrastructure. No wonder, both can harmoniously co-exist in the clean transport sector. As Tesla Semi makes its debut, customers will have the opportunity to determine their preferred choice.

MUST READ: New EPA GHG Standards for Trucks to Cut 60% Emissions by 2032 

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