Uncategorized – Page 58 – The Global Carbon Fund

Hot Funds for Cool Tech: Geothermal Company Fervo Energy Raises $244M

March 6, 2024/in Uncategorized /by

Geothermal startup Fervo Energy Co. secured a substantial $244 million round, led by shale oil and gas giant Devon Energy Corp. The Houston-based geothermal developer’s fundraising topped this week’s Crunchbase biggest funding rounds.

The raised funds exceeded what Fervo Energy disclosed in its recent SEC filing, aiming for $221.5M funding. The capital infusion will bolster Fervo’s drilling endeavors in Utah. The project could start supplying clean electricity to the grid by 2026.

Founded in 2017, Fervo has amassed $431 million in funding, according to Crunchbase records.

Tapping Earth’s Heat: Fervo Energy’s Geothermal Breakthrough

Fervo Energy focuses on leveraging horizontal drilling technology, originally pioneered by the oil and gas sector, to harness geothermal resources for power generation.

In collaboration with Google LLC, the company completed an enhanced geothermal system (EGS) pilot project in Nevada in November 2023. This initiative caters to some Google data centers in the state.

Fervo’s successful demonstration is the first instance of an enhanced geothermal system implemented on a commercial scale.

Geothermal energy, often dubbed the “heat beneath our feet,” currently contributes 3.7 gigawatts of electricity in the U.S. That amount could power over 2.7 million homes, but this constitutes only a fraction of its immense potential.

A considerable portion of geothermal energy remains untapped due to technological limitations, leaving vast energy reservoirs unexploited.

This is where the EGS holds promise in unlocking these resources and introducing clean, and dispatchable electricity to the grid. This geothermal system employs man-made reservoirs to facilitate fluid flow, enabling the extraction of hot water for electricity generation.

Drilling for Tomorrow

The technical potential of EGS in the US alone could meet global electricity demands.

Even harnessing a fraction of this resource through widespread deployment could feasibly power 40+ million American homes and businesses affordably. Moreover, investments in EGS will promote the proliferation of geothermal heating and cooling solutions nationwide. This, in turn, will provide exponential opportunities for sustainable energy utilization.

Currently, Fervo Energy is engaged in a drilling campaign at its 400-MW Cape Station project in southwestern Utah. Early results from this endeavor have surpassed the expectations set by the US Energy Department for enhanced geothermal systems.

The company has received a grant from the DOE for the Utah project to showcase the potential of EGS in delivering reliable and cost-effective electricity.

Before this offering, Fervo Energy had secured a combined $176.63 million across three disclosed funding rounds, according to data from S&P Global Market Intelligence. Investors in the company include oil and gas firms Devon Energy Corp., Liberty Energy Inc., and Helmerich & Payne Inc., as well as Breakthrough Energy LLC, a venture capital firm backed by Bill Gates.

DOE’s Green Push for America’s Clean Energy Future

The U.S. DOE announced a plan to allocate up to $60 million to 3 geothermal pilot projects as part of the enhanced geothermal systems pilot demonstrations funding opportunity. Fervo Energy’s project is one of them, aiming to generate at least 8 MW of power from each of 3 wells.

The initiative is spearheaded by the DOE’s Geothermal Technologies Office, a component of the Office of Energy Efficiency and Renewable Energy.

The other two selected projects include Chevron New Energies’ pilot endeavor. It will use drilling and stimulation techniques to access geothermal energy in Sonoma County, California.

Additionally, Mazama Energy LLC’s demonstration on an enhanced geothermal system near a volcano in Oregon was chosen.

US Secretary of Energy Jennifer Granholm expressed enthusiasm for the projects, noting their potential to expand geothermal power into previously untapped regions. She also noted that:

“…these pilot demonstrations will help us realize the full potential of the heat beneath our feet to reduce carbon emissions, create domestic jobs, and deliver clean, cost-effective, reliable energy to American[s] nationwide.”

The DOE plans to support further demonstrations in the eastern US in the second round of funding. With a goal to slash the cost of enhanced geothermal systems by 90% by 2035, the Biden administration aims for 100% clean electricity by that year.

RELEVANT: Transforming the American Clean Energy Landscape Under Biden’s Era

Geothermal resources currently contribute around 4 GW of electricity in the US. Still, advancing enhanced geothermal systems could potentially yield 90 GW of power by 2050, which power over 65 million households. That projection is according to a January 2023 analysis by the DOE’s National Renewable Energy Laboratory.

Fervo Energy’s groundbreaking geothermal system, fueled by a $244 million funding round, signify a pivotal shift towards sustainable energy solutions. With ambitious projects and support from industry giants, Fervo is poised to lead the charge towards a cleaner, greener future.

The post Hot Funds for Cool Tech: Geothermal Company Fervo Energy Raises $244M appeared first on Carbon Credits.

China’s Grip On Rare Earth Elements Loosens

March 6, 2024/in Uncategorized /by

Friction from the West is Loosening China’s Grip on Rare Earths Elements

As the world grapples with the urgent need for decarbonization to combat climate change, China’s top position in the production of rare earth elements (REEs) and its growing influence in the carbon credit market have had profound implications for the global energy transition

China currently dominates the market supplying over 80% of the world’s rare earth elements. Considered a monopoly in most political circles, its prominent position has raised concerns among many nations about the vulnerability of their supply chains and the geopolitical implications. But is this tension a sign of possibile future supply limitations that pose a threat to the decarbonized future?

REEs are a set of 17 metallic elements with unique electrical and magnetic properties, playing a crucial role in the mineral supply chain market. Their applications range from magnets powering electric vehicles (EVs) and wind turbines to defense systems using precision missiles, fighter jets, and submarines, energy-efficient lighting systems etc.

All these factors come down to one thing: green energy transition, because:

China leads the production of key materials for EV batteries, refining 68% of the world’s cobalt, 65% of nickel, and 60% of lithium meeting the required grade. Additionally, it holds a significant share of ~ 75% of EV batteries, and the majority of them are manufactured in China.

China maintains its position in the rare earth industry due to its comprehensive control over the entire production chain and a substantial scale in the world economies. China’s advantages extend from mining raw materials to producing high-purity rare earths, facilitated by a cost-effective labor force.

Is this enough to sustain China’s dominance in the long run? It’s indeed a matter of concern and the answer is that there are numerous loopholes in marketing strategies, political scenarios, and supply chain management.

Interdependence of global decarbonization goals and China’s REEs

The concentration of REEs in China raise concerns worldwide. Although, the US Department of Energy once said:

“the US decarbonization goals are reliant on both Chinese firms and the Chinese government”

Yet the current geopolitical scenario is slightly different. The prime issue is that no matter where the REEs are mined, they need to undergo processing in China. This grants China substantial influence over various supply chains. But in this ESG-conscious era, investors, suppliers, and consumers must be more aware of the environmental effects of their purchases.

The extraction of rare earth minerals is a complex process and has raised serious climatic concerns. A study from the Harvard International Review stated,

“Mining to produce one ton of rare earth elements results in nearly 30 pounds of dust, 9,600-12,000 cubic meters of waste gas including substances such as hydrofluoric acid and sulfur dioxide, 75 cubic meters of wastewater, and one ton of radioactive residue—2,000 tons of toxic waste altogether.”

The report also mentioned that the world’s largest rare earth element mine, Bayan-Obo in China, produced over 70,000 tons of radioactive thorium waste which is stored in a tailing pond that has leaked into groundwater.

China, being the prime market for REEs must adopt ways to make large-scale mining more sustainable and greener. Some latest technologies include:

Electrokinetic method is used by many Chinese companies to improve the leaching process and quantity of the extracted minerals. It’s mostly suitable for heavy REE with high atomic numbers like dysprosium and terbium.
Biomining is a highly sustainable process that incorporates microbes to do the leaching process. One such species is the cyanobacteria- it produces organic acid to extract the REE from recycled e-waste, ores, and wastewater.
Agromining – the process incorporates plants that have hyperaccumulation and rapid-growth capacity on REE-rich soil. Researchers say agromining works most efficiently for nickel.

However, all the sustainable alternatives mentioned above are yet to be examined deeply considering their practical values and cost effectiveness.

We can infer that China to remain in the top position in the carbon market and REEs, must operate in socially and environmentally responsible ways. The country further needs to ensure transparent supply chains free from human rights infringement and environmental damage.

On the other hand, the West is putting serious efforts to decrease dependence on China for rare earth mineral supply. They are exploring technologies to replace REEs or use fewer REEs.

For example, Tesla recently announced plans for next-generation motors using rare earths-free magnets. There’s a mixed review of this move. While some industry pundits say it would have minimal effect on the market because they believe EVs without rare earth will have a very low success rate. While others consider this to be a revolutionary move. It is further predicted that production of EVs in the coming years won’t experience a slump if they become independent of rare earth minerals. This in turn will directly push the carbon market and mitigate carbon dioxide emissions.

These are just some of the factors responsible for REE’s geopolitical conundrum and have given rise to an important question – does a fair trade agreement exist between China and the West over rare earth elements?

Will Friction from the West Loosen China’s Grip on REEs?

The US and Europe have shaken hands and signed deals without China. President Biden and his allies prioritize technology and green energy, while Global South nations, like India, push for EV adoption to boost energy independence.

One notable collaboration involves US and European rare earth companies processing monazite sands in Utah, followed by shipping rare earth carbonates to Estonia for further refinement.

In recent news, the United States Department of Defense (DoD) granted a $120 million contract to Australia’s Lynas Rare Earths to construct a heavy rare earths separation facility in Texas. Lynas USA LLC, a subsidiary of Lynas Rare Earths Ltd, will own and operate this facility. The objective of the contract is to bolster domestic industrial capacities for heavy rare earth elements (HREEs), involving metals like gadolinium, dysprosium, and ytterbium.

Japan has also fortified its rare earth supply chain by increasing investments in Lynas, securing a steady supply of heavy rare earths. According to UN Comtrade data, Japan has succeeded in this strategic move to decrease its rare earth dependence on China from over 90% to 58% within a decade.

Source: elements.visualcapitalist.com

The graph above showcases China’s share of global production of REE market is expected to go down from 92% in 2010 to 58% in 2020.

Despite the solid efforts put in by the US, Europe, and Japan, China continues to defend its monopoly. It has aggressively expanded its international market by acquiring stakes in some of the largest mining companies like MP Materials (US) and Vital’s Metals (Australia).

China’s tax system and production quota are highly meticulous. It has imposed 13% VAT on magnets, metals, and oxides. Simply put, domestic rare earth product manufacturers have a 13 % cost advantage in the supply chain over foreign competitors. Thus, if countries decide to diversify their rare earth supply chains away from China, it could result in increased costs for those nations.

Will this Geopolitical Tension be a Roadblock to the Green Energy Transition?

A survey conducted by The Oregon Group, explains that 2024 is expected to witness persistent volatility and surged prices in major commodities and rare earth minerals. Contributing factors are:

supply constraints
geopolitical tensions
long-term underinvestment

This economic contraction particularly in the US and China can potentially supress demand and supply, especially in the critical mineral sector. It’s foreseeable that in the current year and beyond, a distinct divergence in critical mineral prices between Western nations and China may not manifest. And this leads one to the conclusion that if geopolitical tensions and inefficient strategic planning persist between the leading economies of the world, then energy transition goals for sustainable low-carbon future are most likely to get hindered.

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Flying High: How Does Taylor Swift’s Eras Tour Impact the Environment?

March 5, 2024/in Uncategorized /by

Taylor Swift’s global stardom is undeniable, captivating millions of fans worldwide with her music and performances. However, behind the glitz and glamour of her Eras Tour lies a less glamorous reality: the environmental impact of her frequent air travel, particularly her flights’ carbon emissions.

Swift’s Eras Tour takes her to various destinations globally, requiring extensive air travel for herself, her crew, and equipment. This constant jet-setting contributes significantly to carbon emissions, intensifying climate change and environmental degradation.

Flying High: The Environmental Toll of Celebrity Air Travel

The aviation industry is a major emitter of greenhouse gases, particularly carbon dioxide (CO2), which is released during the burning of jet fuel. It’s one of the fastest-growing sources of CO2 emission, responsible for about 2% of the global carbon emissions. Airlines emit over 900 million tonnes of CO2 annually.

According to the International Council on Clean Transportation, a round-trip flight from New York to London emits around 1.6 metric tons of CO2 per passenger. But that emission is based on data from commercial flights, which have a much lower footprint than private jet flights.

Private jets stand out as the most environmentally harmful travel option. According to Transport & Environment, an individual flying on a private plane emits 10 to 20 times more CO2 than a passenger on a commercial airline.

Moreover, air travel’s impact extends beyond CO2 emissions. Aircraft emit other pollutants, such as nitrogen oxides, particulate matter, and water vapor, which all contribute to air pollution.

To address such environmental concerns and reduce harmful emissions, some airlines have made operational improvements and technological advancements. Examples are using low-carbon jet fuels and more energy-efficient aircraft components and technologies.

Still, the sheer volume of air travel associated with large-scale tours like Swift’s Eras Tour presents a significant environmental challenge.

Additionally, Swift’s tour involves transporting equipment, stage props, and merchandise across continents, further increasing carbon emissions through transportation logistics.

How Big is Swift’s February Tour Flight Carbon Footprint?

Focusing on the pop star’s frequent flying since her Eras Tour started in March last year, the emissions are sky-high. Let’s consider her previously completed February tour, consisting of 11 total shows in three different cities: Tokyo, Sydney, and Melbourne.

Carbon emissions data for specific flights can vary depending on factors such as route efficiency and passenger load. However, using figures based on estimated emissions data will provide a general idea of the CO2 footprint associated with Swift’s air travel between those cities.

From her home base in New York City to Tokyo, Japan, the estimated CO2 emission is around 48 metric tons (Mt) of CO2 per the Paramount Business Jets carbon footprint calculator. The company’s private jet carbon offset calculator is a tool that helps in calculating the CO2 emissions of trip using various private aircraft types and categories.

After her last show in Tokyo on February 10, Swift flew to Las Vegas to support her boyfriend Kansas City Chiefs Travis Kelce at the Super Bowl LVIII. That known flight made the singer emit 40 Mt of CO2.

Assuming that Swift went back to her Manhattan abode, her flight emitted another 17 Mt of CO2.

Then on February 16, Swift had flown to Melbourne, Australia to perform her 3-day Eras Tour show. Using the same calculator, flying on her jet to take that route emitted 147 Mt for a roundtrip back home.

Lastly, Swift went back to Australia on February 23, this time in the capital city to complete her February schedule. She performed for four days straight in Sydney until February 26. This part of Swift’s Eras Tour flight released 141 Mt of carbon emission, from New York to Sydney and back.

The Sky’s the Limit for Taylor Swift’s Eras Tour Carbon Emission

Overall, flying in her private jet to attend the 11 Eras Tour shows for February alone made Taylor Swift responsible for emitting a total of 393 Mt of CO2. Putting that into perspective, an average person in the U.S. emits around 16 tons or 14 metric tons yearly.

That’s how huge Swift’s air travel emissions are – 28x more than an average person emits in a year. That didn’t even include the emissions of the shows themselves and the fans who have traveled from various destinations, too.

Factor in the rest of her Eras Tour shows, starting from March 2023 until December 2024 and the figure explodes.

While Swift herself may not be solely responsible for the environmental impact of her tour, her high-profile status and influence could be harnessed to promote sustainability within the entertainment industry.

Artists like her could take some steps to mitigate their environmental footprint. These can be investing in renewable energy initiatives, advocating for eco-friendly touring practices, and implementing carbon offset programs. Swift’s spokesperson confirmed that she’s into carbon offsetting and has bought offsets to cover her tour travel.

In conclusion, while Taylor Swift’s Eras Tour undoubtedly entertains millions of fans worldwide, it also underscores the environmental costs associated with extensive air travel. As society increasingly grapples with the urgency of climate change, it becomes imperative for both artists and fans to consider the environmental consequences of large-scale tours and work towards more sustainable alternatives.

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US Energy Storage Rises 59% Amidst the Era of EVs and Lithium

March 4, 2024/in Uncategorized /by

Amidst a backdrop of growing electric vehicle adoption and shifting dynamics in the lithium market, the landscape of energy storage in the US is rapidly evolving. With record-breaking installations of lithium-ion battery arrays and notable reductions in lithium prices, the sector is poised for significant transformation.

Unleashing the Power of Energy Storage

Energy storage developers are forging ahead, connecting unprecedented volumes of lithium-ion battery arrays to the US power grid. About 6.8 GW of new large-scale battery capacity was added in 2023, a 59% increase from 2022, according to S&P Global Market Intelligence.

These projects store electricity primarily for one to four hours and are often co-located with renewable or fossil-fueled power plants. They include over 120 installations, with California, Texas, and the greater Southwest leading the expansion. Together, they bring total non-hydroelectric storage resources to about 17 GW.

According to Market Intelligence data, California leads with 8,179 MW of operating batteries, followed by Texas with 4,252 MW, as of Feb. 8. Arizona ranks third with 858 MW, trailed by Nevada with 758 MW and New York with 232 MW. The battery storage pipeline is also expanding in states like Oregon, Indiana, and Wisconsin, signaling broader growth beyond the Southwest-centric focus.

In 2024, an impressive 34 GW of big battery resources will come online, with over 10 GW under construction. However, development timelines often need to catch up, with delays throughout the year.

S&P Global Commodity Insights anticipates 4.2 GW of firm projects in 2024, forecasting a total installed battery power storage capacity of 23 GW by the end of 2025. This robust growth underscores the pivotal role of energy storage in America’s transition to a sustainable energy future.

Breaking Records, Building Resilience

Despite project delays, developers achieved a record-breaking quarter in the last three months of 2023. They have installed 2,332 MW for that period, doubling the previous year’s figure and surpassing the 3rd quarter’s record.

The largest completion was Terra-Gen LLC’s Edwards & Sanborn solar-plus-storage complex in Southern California. The project boasts 971 MW/3,287 MWh of storage and 800 MW of solar capacity. Other notable completions include Plus Power’s 300-MW/600-MWh Rodeo Ranch Battery Storage in Texas.

These achievements in lithium-ion battery storage installations go hand-in-hand with the optimistic growth in the plug-in electric vehicle (PEV) market.

RELEVANT: New Monthly EV Sales Record to Kickstart 2024

January saw PEV sales surge in key markets. China and the Europe-Top 4 markets recorded impressive year-over-year growth of 101.8% and 33.7% respectively. However, this growth pales in comparison to the January 2022 figures.

European policymakers have scaled back PEV incentives due to fiscal concerns, with Germany ending subsidies earlier than anticipated in 2023. In the US, stricter sourcing requirements have limited models qualifying for the EV tax credit. This negatively impacted best-selling models like the Ford Mustang Mach E and certain versions of the Tesla Model 3.

In response to subsidy cuts, automakers are shouldering subsidy costs themselves. Volkswagen AG is covering all subsidies in Germany until the end of 2024, while Stellantis NV is offering reduced subsidies in Q1 2024. Automakers are also slashing PEV prices to stimulate demand amidst reduced consumer appetite. Tesla Inc. and Ford Motor Co. have implemented price cuts in China, Europe, and the US.

Charged for Change: Challenges and Opportunities in the Lithium Market

Reduced battery costs, stemming from lower metal prices, have facilitated the price reductions. Lithium-iron phosphate cell production costs dropped by around 30% in 2023, with a further 20% reduction expected in 2024.

RELEVANT: Why Lithium Prices are Plunging and What to Expect

This environment has intensified competition, particularly in China, prompting PEV manufacturers to vie for market share aggressively. As the China Passenger Car Association notes, 2024 is pivotal for new energy vehicle companies, heralding fierce competition ahead.

As lithium prices continued to decline, reports of curtailed lithium mine operations heightened. This particularly affects junior miner-led hard-rock mines in the ramp-up phase. These projects face significant pressure due to the necessity of raising initial capital and maintaining cash flow, leaving little room for high-cost ventures.

Core Lithium halted open-pit mining at Finniss in Australia’s Northern Territory, while Liontown is delaying expansion plans at Kathleen Valley in Western Australia.

Meanwhile, Sayona Mining is reassessing its North American Lithium project in Quebec. But a junior Canadian lithium company, Li-FT Power (LIFT: LIFFF) works hard to help meet North American lithium demands.

Li-FT specializes in consolidating and advancing hard rock lithium pegmatite projects within Canada while targeting established lithium districts. The company is dedicated to advancing the exploration and development of top-tier lithium assets throughout the country.

Despite limited trading activities and the stabilizing of lithium carbonate prices, bearish sentiment persists over demand and prices. Speculation about further cuts in lepidolite mines in China boosted Australian mining stocks. It also does so with the price of the main lithium carbonate contract on the Guangzhou Futures Exchange.

As the US power grid evolves toward sustainability, the surge in energy storage installations marks a transformative step. With record-breaking battery installations and declining lithium prices, the landscape is ripe for innovation and growth.

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Rio Tinto Aims 3.5M Carbon Credit Pledge, Eni Leads with Retired Credits

March 4, 2024/in Uncategorized /by

As corporations worldwide intensify their efforts to combat climate change, commitments to carbon offsetting have become increasingly prominent. In this update, we delve into Rio Tinto’s ambitious pledge to retire 3.5 million carbon credits annually by 2030 and Eni’s remarkable achievement of already reaching this milestone.

These recent developments in the voluntary carbon market (VCM) have bolstered longer-term confidence in the market’s pivotal role in corporate net zero programs.

Rio Tinto’s Ambitious Carbon Credit Goal

Rio Tinto, the world’s second-largest miner, aims to boost its retirement of carbon credits to 3.5 million annually by 2030. This accounts for roughly 10% of its baseline emissions, according to its recent climate report.

The company plans to intensify its involvement in the VCM to meet its 2030 climate goal. This comes into light after acknowledging the necessity of offsets after likely missing interim 2025 decarbonization targets.

To achieve this, Rio Tinto will conduct feasibility studies in Guinea and South Africa while scaling up activities in priority regions. This effort will particularly focus on nature-based solutions (NBS) pilots and studies. The company pledges to disclose commercial partnerships in the VCM, along with details of its carbon credit sourcing strategy.

With annual scope 3 emissions of 578 million tonnes of carbon dioxide equivalent (tCO2e), Rio Tinto’s emissions in scopes 1 and 2 remained relatively stable at 32.6 million tCO2e in 2023.

The company has set targets of 15% reduction by 2025 and 50% by 2030 for these emissions.

From an initial aim of generating 1.7 million tonnes yearly by 2030, the miner plans to retire about 3.5 million carbon credits annually over the next decade.

Carbon credit procurement, mainly through Australian Carbon Credit Units (ACCUs), is expected to rise to around 1.7 million tCO2e by the end of the year.

The company aims to commit at least 500,000 hectares of land to high-integrity NBS programs globally by 2025.

Total decarbonization spending for 2024 is estimated at $750 million, including capital and operational expenditures, offsets, and Renewable Energy Credits (RECs). However, Rio Tinto revised its expected expenditure for meeting 2030 climate targets downward to $5-6 billion from $7.5 billion.

To lower emissions, Rio Tinto plans to increase biofuel use, procure renewable energy, enhance smelter efficiency, and introduce more LNG vessels. The mining giant will also focus its carbon credit investments in regions with substantial emissions, such as Australia and North America. Their strategy entails transitioning upstream to co-developing or co-financing carbon offset projects, ensuring long-term access to high-quality credits.

Eni’s Remarkable Feat: 3.5M Retired Credits

While the Australian miner targets to retire 3.5 million carbon credits, the Italian oil and gas producer, Eni SpA has already achieved it. Eni retired a total of about 3.5 million carbon credits from various REDD+ projects. These include the following:

Mai Ndombe REDD+ project (VCS934): 1,058,000 v2020, 600,000 v2019, 600,000 v2018, and 269,000 v2017 credits.
Ntakata Mountain REDD project (VCS1897): 650,000 credits
Kulera Landscape REDD+ project (VCS1168): 269,000 credits

The energy company aims to reach net zero emissions by 2050. For Eni, net zero means “achieving carbon neutrality of processes and products”.

The company’s interim targets include achieving net zero from exploration activities by 2030 and from operations by 2035 (Scope 1+2). Ultimately, they aim to reach Net Zero for all greenhouse gas emissions, including Scopes 1, 2, and 3 by 2050, as shown below.

To hit those goals, Eni employs various decarbonization measures in a comprehensive industrial transformation plan involving the entire company. Key components include decarbonizing the upstream portfolio, expanding into biofuels, renewables, and circular economy sectors, and providing new energy solutions.

In addition to Eni’s emissions reduction plan, they have initiated Carbon Offset Solutions projects. They aim to safeguard biodiversity, sustainably manage land through ecosystem restoration, and compensate for residual emissions that cannot be mitigated.

Signs of Market Resilience? New Credits Listed on CBL

These announcements occurred during a week marked by active corporate interest and discussions but relatively light carbon credit trading volumes. The total volume on the CBL platform was 123,721 tons, with nature-based carbon credits comprising the majority.

Notably, though, Xpansiv’s weekly environmental markets report revealed a significant number of new voluntary credits posted to the CBL central limit order book. That includes almost 100,000 I-RECs alongside various nature and technology carbon credits.

The offers listed below are firm, yet subject to execution, modification, or cancellation.

Source: Xpansiv update

Nevertheless, that bunch of new voluntary credits listed and increased retirement plans indicate continued interest and participation in the market. More interestingly, does that mean carbon prices could rebound after plummeting in the last two years? This is something to keep a close eye on.

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Singapore’s Carbon Credit Market Surging At 21% CAGR

March 1, 2024/in Uncategorized /by

Late last year, the Ministry of Sustainability, and the Environment (MSE) and the National Environment Agency (NEA) had rolled out the Eligibility Criteria under the International Carbon Credit (ICC) Framework. In accordance with Article 6 of the Paris Agreement, Singapore’s ICC Framework fosters global collaboration to attain climate sustainability objectives. Effective cooperation from international carbon markets will further boost Singapore’s goal achieve net zero emissions by 2050.

In 2023, the market size of Singapore’s Carbon Credit reached US$ 14.5 million. Current industry data shows that this is expected to jump to US$ 55.14 million by 2030, reflecting a compound annual growth rate (CAGR) of 21% from 2023 to 2030.

Take a quick look at the chart to know the market size and the major players.

Source: Coherent Market Insights

Moving on, we will deep dive into the analysis of the Singapore Carbon Credit Market, exploring its current status, key trends, and future prospects.

Singapore Carbon Credit Market – A Current Analysis

In December 2021, The Singapore Finance Minister Lawrence Wong stated:

“In many ways, we believe we are well-positioned to serve as a carbon services and trading hub for Southeast Asia and the Asia Pacific, given our foundation as a regional centre for professional services, commodity trading and financial services”.

He further added that the country is already home to more than 70 carbon services and trading firms that use Singapore as a base to serve the region and engage in carbon market activities.

Key factors fuelling the rise of Singapore’s carbon market are primarily attributed to the following:

increasing awareness on climate change
enforcement of government regulations
and a focus on corporate sustainability commitments

Singapore relies heavily on renewable energy projects like solar, wind, and hydropower to propel its carbon credit demand. The market dynamics show that the Singapore government has implemented several initiatives to achieve its projected value of its domestic carbon credit market.

Government Regulations: The Carbon Pricing Act

The Carbon Pricing Act mandates the disclosure of greenhouse gas (GHG) emissions and imposes a tax linked to these emissions. Its objective is to incentivize businesses and industries to actively diminish their carbon footprint. Early in 2019, a carbon tax was set at $5 per tonne of CO₂ equivalent (tCO₂e) but to support the net-zero target, the tax is increased to S$25/tCO₂e in 2024 and 2025, and expected to rise to S$45/tCO₂e in 2026 and 2027 and S$50- S$80 by 2030.

The taxation system applies to all businesses emitting 25,000 tonnes or more of greenhouse gas each year. This further aligns with the estimated target to achieve $55.14 Million by 2030. Not only this, the government also focuses on Energy Efficiency Programs to encourage use of clean and renewable sources of energy.

And according to recent reports, the government has set a target to cut down 50% of carbon dioxide emissions by 2030 and achieve net zero emissions at the earliest by 2050.

Further Reading: Singapore Sets Higher Standards for International Carbon Credits

ESG Policies towards Decarbonization Commitments

The long term sustainability goals are shaped by an organization’s individual goals and values and geographic context. Priority is given to energy efficient cost savings, energy security, and advance to decarbonization. This is a collective commitment of the corporate sector to achieve net zero by 2050.

As per NCCS Singapore, the city currently hosts over 70 organizations offering carbon services, marking the highest concentration in Southeast Asia. Global corporations and local settings are investing resources to establish and fortify their carbon services platforms in the country.

One notable effort was put forward by GoNetZero who launched a one-stop digital solution for renewable energy certificates, carbon credits, and carbon management. Launched with support from EDB’s Corporate Venture Launchpad programme, GoNetZero secures partnerships with big and small businesses (renewable energy companies), helping them buy carbon credits and offer innovative data driven solutions to track their net zero efforts.

To name a few, KPMG, Sembcorp Industries, Microsoft, Global Centre for Maritime Decarbonization (GCMD), etc. play a significant role towards decarbonization in Singapore.

The following infographic clearly shows how technology can leverage ESG policies:

Source: sganalytics.com

Singapore’s Robust Carbon Trading Ecosystem

Firstly, Singapore’s dedication to environmental sustainability and its initiatives to advance carbon neutrality drives it to be in the mainstream market of carbon credit trading. Simply put, solid backing from the government creates a viable trading environment for carbon exchange.

With the implementation of the National Climate Change Strategy known as the Singapore Green Plan 2030, the city is setting standards high for a favourable carbon trading market.

Second, prominent market leaders in Singapore’s carbon credit market are Climate Impact X, Carbon Credit Capital, Carbonbay, South Pole, and Triple Oxygen. For example, in September 2022, Carbonbay introduced a revolutionary carbon trading and offsetting platform tailored for the Asia Pacific markets. This cutting-edge platform enables organizations to acquire carbon credits while actively participating in the advancement of regional offset projects.

The existence of these big players in Singapore offers a multitude of possibilities to buy, sell, and store carbon credits, thereby reinforcing their carbon ecosystem.

Live Streaming: The easiest way to promote carbon credit market

Live streaming can potentially contribute to the promotion and understanding of the carbon markets. It’s a direct interactive platform for analysts to discuss market trends, and policy changes, and provide insights into carbon credit prices. Given the dynamic nature of carbon markets, live discussions on policy developments, regulatory changes, and government initiatives can keep the audience informed about the evolving landscape.

Many tech companies and start-ups have already begun hosting virtual conferences or events related to the carbon market. This provides a platform for networking, collaboration, and exchange of ideas among participants.

With all said and done, Singapore is strategically positioned to emerge as a central hub for carbon services and trading in both Southeast Asia and the wider Asia Pacific region. Therefore, the goal to achieve the target of $55.14 million by 2030 with a 21% CAGR is very likely attainable.

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Toucan Launches World’s First Liquid Market for Biochar Carbon Credits

March 1, 2024/in Uncategorized /by

Digital platform Toucan.earth is set to launch the world’s inaugural ‘liquid’ market for biochar credits, in response to escalating interest from carbon credit buyers and developers.

Toucan creates a digital infrastructure for climate finance, simplifying the process of buying, selling, and retiring carbon credits.

Why Biochar Carbon Removal Credits?

Biochar, a type of charcoal, is created through the pyrolysis process of organic matter, typically derived from plant-based sources such as wood, crop residues, or manure. This process allows biochar to store carbon for longer periods while offering multiple co-benefits beyond carbon removal.

Such is the reason why biochar has been the go-to approach companies are looking for in their carbon removal solutions. The World Economic Forum calls it a “carbon removal’s jack of all trades”.

Source: Carbonfuture

For WEF, Biochar Carbon Removal (BCR) isn’t just optional for achieving net-zero targets – it’s critical. It can remove between 0.44 to 2.62 gigatons of CO2 annually, addressing up to 35% of the Carbon Dioxide Removal (CDR) requirements in scenarios aimed at stabilizing the climate.

Notably, 94% of delivered carbon credits in 2023 are biochar while only receiving about 12% of CDR funding (CDR.fyi). Plus, biochar comes at a considerably lower cost compared to other durable CDR approaches. On average, BCR costs $179 per ton of CO2, significantly lower than the average price of $388/ton across all CDR methodologies.

Biochar Unleashes Nature’s Carbon Removal Power

Moreover, demand for biochar carbon removal credits has surged. According to the International Biochar Initiative, the industry’s main trade group, there would be a potential 6-fold increase in biochar material output within the next 2 years.

The group also found out that biochar can potentially eliminate up to 6% of global emissions annually. That’s equivalent to about 3 billion tonnes of CO2 of the total emissions produced by 800+ coal-fired power plants in a year.

BeZero, a credit rating platform, recently reaffirmed its confidence in BCR by awarding an A rating to a BCR project. This marks BeZero’s inaugural evaluation of CDR credits, highlighting the increasing recognition and reliability of BCR within the removal landscape.

However, the absence of a liquid market, one that is widely traded, has impeded many investment opportunities in BCR.

Within the broader voluntary carbon market, standardized contracts on exchanges have lost momentum due to a significant price decline. Meanwhile, over-the-counter trading for individual projects remains active but highly customized.

This VCM issue is what Toucan addresses as emphasized by its founder, Raphaël Haupt, saying:

“Everyone is trying to understand how we can have the best of the standardized and the OTC worlds…The pool is our answer.”

Toucan gained prominence in 2021 by introducing ‘tokenization‘. It’s a digital process that transforms carbon offsets into assets transferable on the blockchain, facilitating their use in various financial applications.

RELEVANT: Top 5 Carbon Crypto Companies to Watch in 2024

By seamlessly integrating with existing registries, Toucan moved over 20 million carbon offset credits into the crypto space within weeks. It is further fueled by a growing interest in the energy transition from the crypto community.

However, amid widespread adoption, concerns arose regarding the quality of transferred credits.

CHAR: Transforming Carbon Trading with Crypto Innovation

Subsequently, the practice was prohibited by the US-based registry Verra, despite the enthusiasm for crypto assets and brokers’ profit motives.

Last year, Toucan established a seamless connection with the Puro.earth registry, facilitating credit transfers between their platforms.

The digital platform has introduced an additional screening process for Puro.earth projects based on its criteria. From that, Toucan is on the brink of launching a marketplace for biochar carbon removal credits sourced from those projects.

Toucan believes that this new crypto-based carbon platform called CHAR would give buyers a low-risk process to acquire BCR credits.

CHAR by Toucan serves as a pivotal infrastructure facilitating the automated, on-demand trade of biochar carbon credits. It consolidates pre-screened credits sourced from Puro.earth called “CORCs” onto a unified platform under the banner of CHAR.

CHAR’s streamlined access to capital aligns with Toucan’s mission to alleviate significant supply bottlenecks prevalent across CDR initiatives. It aids existing and emerging projects within the nascent biochar market to liquidate their credits to finance their expanding operations.

A sneak peak into CHAR by Toucan

The pool will establish a unified price for BCR credits accessible online round the clock, enhancing transparency within the industry. A sale within Toucan’s CHAR pool will automatically trigger a payment to the original project developer in the form of ‘royalties’, offering them potential upside if a project experiences high trading activity.

The company has enlisted its initial group of project developers, including US-based Oregon Biochar Solutions, Quebec-based GECA Environnement, Exomad from Bolivia, American Biocarbon, and BC Biocarbon from Canada.

Thanks to the direct integration with Puro’s registry, buyers will also have the flexibility to permanently retire the credits, sell them into the pool, or transfer them back into their Puro account.

Toucan.earth’s innovative CHAR platform heralds a new era for carbon markets, providing a liquid marketplace for biochar credits. With surging demand and the potential to offset billions of tons of CO2 emissions annually, the crypto trading platform streamlines access to capital, fostering growth in the biochar industry while advancing carbon dioxide removal efforts.

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Spectaire Holdings’s Innovative Tech Helps Truckers Generate Carbon Credits

February 29, 2024/in Uncategorized /by

Spectaire Holdings Inc., a global leader in air quality monitoring and emissions reduction technologies, has announced a significant development in response to the mounting financial and environmental challenges posed by escalating carbon taxes in Canada.

Spectaire specializes in delivering effective solutions that help companies reduce their carbon footprint while focusing on creating high-quality carbon credits.

The company proudly unveils the successful deployment of its groundbreaking AireCore technology within several prominent Canadian trucking fleets. This strategic initiative aims to offer a sustainable solution that aligns with national objectives for carbon emission reduction. It also provides a means to alleviate the economic burden imposed by tax legislation on the trucking industry.

Driving Change: Spectaire’s AireCore Revolutionizes Carbon Monitoring

The trucking sector stands as a vital pillar in Canada’s transportation supply chain. With an extensive road network spanning the nation, trucks serve as the primary mode of transportation for shipping goods across the country. Moreover, the trucking industry plays a pivotal role in facilitating trade with the United States, Canada’s biggest trading partner.

In 2021, the transportation and warehousing sector holds significant importance within the country’s economy, contributing 3.6% to its total gross domestic product (GDP) and employing over 5.2% of its workforce. Within this GDP sector, truck transportation offers the predominant mode of goods movement, constituting over 28% of the sector’s activity.

Distribution of the Transportation and Warehousing Sector’s 3.6% Share of Canada’s GDP

Source: Library of Parliament

However, the trucking industry is also subject to Canada’s carbon pricing regulations. That could be due to the fact that within the transportation sector, recent data on Canada’s overall emissions indicates a persistent upward trend in greenhouse gas (GHG) emissions from medium- and heavy-duty vehicles (MHDVs).

These emissions account for 37% of total transportation emissions.

The country’s largest trucking alliance, the Canadian Trucking Alliance, has called on the government to suspend excise tax on diesel. CTA’s President Steve Laskowski remarked they’re doing their best to advance decarbonization in the sector. Still, the diesel engine remains to be the major method in the sector.

In the U.S., trucking companies are starting to shift to hydrogen fuel for long-haul trips. Companies like Nikola are investing in hydrogen technology to overcome infrastructure challenges and meet the growing demand for low-carbon energy. They believe that a revolution is underway where hydrogen holds the promise of a sustainable energy transition.

In Canada, CTA responded to the government’s proposal to provide a 3-year carbon tax exemption for home heating oil in specific regions, the alliance is calling for trucking-related adjustments to federal carbon pricing, too.

Addressing the Carbon Tax Surge in Trucking

As of April 2024, Canadian trucking companies experienced a notable surge in carbon pricing – a 30% increase to $65/tonne. This adjustment translates to an approximate additional carbon tax payment of 17 cents per liter of diesel fuel.

Susan Ewart, Executive Director of the Saskatchewan Trucking Association, emphasized the tangible impact of the carbon tax on truckers. She noted that a driver operating a truck equipped with a 300-gallon tank would incur an extra cost of around $193 per fill. With an average of 106 fills annually, Ewart estimated the annual carbon tax payments per truck to exceed $20,000.

Spectaire’s approach aims to facilitate industry-wide emissions reductions, aligning with the increased federal and provincial carbon taxes across Canada. The deployment of AireCore underscores Spectaire’s dedication to delivering innovative solutions for the environmental and economic challenges confronting the sector.

Brian Semkiw, CEO of Spectaire, acknowledged the financial pressures faced by the trucking industry. This is where AireCore’s ability to measure tailpipe emissions during transit offers a solution.

The technology’s capability enables companies to mitigate their emissions while providing financial relief through carbon offset programs and enhanced tax reporting mechanisms.

Watch here how the technology is installed and works.

Spectaire allows truckers to create technology-based carbon credits with both permanence and additionality with AireCore.

Clearing the Air and Transforming Trucking Industry Sustainability

Danny Bucciarelli, General Director of G&S Direct, emphasized the operational and financial advantages provided by AireCore. He further highlighted that.

“Our collaboration with Spectaire through AireCore not only signifies our dedication to environmental stewardship but also enhances our competitive positioning, facilitates potential tax benefits, and enables the generation of carbon credits.”

Carbon credits are integral to the emissions reduction infrastructure, but the market faces challenges due to insufficient precision and credit auditability. AireCore addresses this issue by enabling precise auditing of each credit, and when and where the reductions happened.

As such, it allows stakeholders to track emission changes and what specific gases were impacted. Management anticipates that the specificity and traceability of Spectaire’s carbon offsets will provide consumers with lasting value through carbon credits supported by measured results.

Spectaire emphasized the shared commitment to leveraging cutting-edge technology for meaningful emissions reduction, citing AireCore’s capability to provide precise, actionable emissions data as a cornerstone of its sustainability strategy within the trucking industry.

RELEVANT: USPS Unveils Plans for Electric Delivery Truck Fleet

The introduction of AireCore by Spectaire represents a significant advancement at the intersection of technology, environmental stewardship, and economic strategy within the Canadian trucking industry. The initiative highlights the innovative capabilities of companies in the sector. More importantly, it establishes a new benchmark for how the sector can effectively address carbon tax challenges and environmental compliance.

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Oxford Revises Principles for Net Zero Aligned Carbon Offsetting

February 29, 2024/in Uncategorized /by

A team of Oxford University researchers has released an updated version of the flagship guidance on credible and net zero-aligned carbon offsetting. First published in 2020, this guidance for high-integrity carbon credits has been widely adopted by hundreds of organizations.

The revised ‘Oxford Offsetting Principles‘ offer clarifications to the original text, incorporating the latest scientific findings while warning that the vast majority of offsetting approaches are not delivering on their promises.

They call for a significant course correction in carbon markets, warning that offsetting practices are falling short of their intended goals. The updated version emphasizes the need for offsetting to align with efforts to reach the Net Zero scenario.

Unveiling the Flaws: Why Current Offsetting Approaches Fall Short

Injy Johnstone, Research Associate at the Oxford Sustainable Finance Group in the Smith School of Enterprise and the Environment, highlights the shortcomings of current offsetting approaches saying:

“The vast majority of current offsetting approaches are not getting us any closer to net zero emissions, and trust in the concept of ‘offsetting’ has been so badly damaged that some organizations are moving away from using the term at all.”

This situation prompted the revised version of the guidance. It provides essential guide for entities to develop offsetting strategies that truly contribute to achieving net zero emissions by 2050 or sooner.

Amid mounting pledges to reach net zero, companies have increasingly turned to purchasing carbon credits to offset their carbon footprint. However, the market is currently facing significant challenges and increased scrutiny.

Carbon price have plummeted immensely. NGEO (Nature-Based Carbon Offsets) price steeply declined by 81% in trading in December last year. This sharp decline reflects the current breakdown in carbon offset markets and the erosion of confidence in them.

As companies grapple with the imperative to reduce their environmental impact, addressing the challenges facing carbon markets becomes increasingly urgent. This is where the updated Oxford carbon offsetting guidance comes in very handy.

The guide focuses on four key elements for credible net zero aligned-offsetting, explained in details below.

The Updated Oxford Offsetting Principles

Principle #1: Cut emissions as a priority, ensure the environmental integrity of credits, and regularly revise as best practice evolves.

This principle, outlined in the figure below, presents a decision tree for users considering carbon offsetting. It’s important to note that these approaches are not strictly mutually exclusive or sequential.

Principle 1 decision tree

Organizations have the flexibility to pursue multiple strategies, prioritizing emissions reduction efforts while also supporting high-integrity, net zero-aligned offsetting projects. Strategies can be continuously updated and refined as new solutions emerge.

Principle #2. Transition to carbon removal offsetting for any residual emissions by the global net zero target date

Relying solely on carbon credits from avoidance or reduction projects is inadequate as a long-term strategy to achieve net zero. Any remaining residual emissions at the net zero target date must be counterbalanced by carbon removals.

The second principle emphasizes that it’s imperative for organizations to explicitly define their carbon removal targets and regularly reassess them to align with actual progress in emission reduction efforts.

Illustrative IPCC Pathways. Adapted from Figure 3.7 from IPCC WG3, showing different scenarios for meeting net zero in which emphasis is on negative emissions (IMP-Neg), renewables (IMP-Ren), or lowering demand (IMP-LD). These demonstrate that the global demand for offsetting capacity is much smaller in scenarios that maximise demand reduction and renewables. This is important because the global capacity for effective and affordable net zero-aligned removal and storage capacity is limited and uncertain, which raises concerns about well-resourced emitters taking up the available supply

Principle #3. Shift to removals with durable storage to compensate residual emissions 

The third principle underscores the critical importance of storing carbon in a manner that ensures permanence and minimizes reversal risk.

Recognizing the inherent risk of carbon unintentionally released back into the atmosphere, any strategy aimed at achieving net zero emissions must acknowledge and address this risk accordingly. Different forms of carbon storage, including biological and geological methods, exhibit varying characteristics depending on their deployment and management.

The figure below presents an example of a Net Zero Aligned Offsetting Portfolio. It provides an illustrative breakdown of the proportion of various project types useful to address residual emissions from 2020 to 2050.

This depiction reflects what an outcomes-based portfolio on the path to net zero could look like, not a current market representation.

Principle #4. Support the development of innovative and integrated approaches to achieving net zero

This last principle underscores the importance of proactively stimulating the development of carbon removals. This principle emphasizes that actors should not solely rely on offsetting via carbon credits but should explore a range of levers to drive progress in this area.

It advocates for entities to signal and commit today to procuring carbon removals to offset residual emissions. This may involve advanced market commitments or other mechanisms aimed at fostering the development/deployment of carbon removal technologies.

Large companies are investing in various carbon removal projects to help scale it up. Tech giants, like Microsoft, Amazon, and Apple, are in the frontline, pre-purchasing carbon removal credits to develop novel CDR methods.

Nature and Governments Have Roles to Play

The revision also underscores the important role of nature-based solutions as part of carbon removal approaches. It calls for mitigation efforts to extend beyond organizational net zero targets.

Overall, the revised Oxford Offsetting Principles offer a comprehensive framework for offsetting strategies grounded in the latest scientific evidence. The authors further emphasize the urgent necessity for regulatory intervention.

They assert that governments, standard setters, and other stakeholders must swiftly implement regulations to guide the market away from low-quality credits and low-integrity offsetting strategies. This regulatory action is crucial to ensuring the integrity and effectiveness of carbon offsetting practices to meet global climate goals.

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